Time Is Running Out For Atari

Video Game Law Blog

September 12, 2006

In April of this year, we reported that Atari, Inc. risked being delisted from NASDAQ if its shares did not trade above $1.00 for more than 10 consecutive business days. That deadline ran out on August 30 and Atari failed to meet NASDAQ's continuing listing requirements, as its share has not broken the $1.00 price. However, Atari intends to request a hearing before the NASDAQ Listing Qualifications Panel, and will remain listed on The NASDAQ Global Market until the panel issues its decision.

On August 30, Atari's share traded at $0.69. In order to bring its trading price above $1.00, Atari could do a reverse split of its share. A reverse split means that the company reduces the number of issued and outstanding shares proportionally among all of the shareholders. For example, each shareholder would get one 'new"? Atari share for every three 'old"? Atari shares that they held. Thereby the trading price will increase. Historically, this has shown only to give a struggling company a short lived relief, in that the trading price often will spiralling down under $1.00 again.

Coverage at http://shorl.com/jefistimujypro (Gamasutra)

Atari's website www.atari.com