ATARI MERGER DETAILS!! ---- FEBRUARY,20 1996!! =============================================================== Toad Computers brings you all of the latest up to date information concerning the Atari merger with JTS Corporation. This is a compilation of all of the information over the past month. ==================================================================== ToadNet! http://www.toad.net/ info@toad.net ftp://ftp.toad.net/ ==================================================================== Time Warner is Atari's second-biggest shareholder with some 12 percent of the outstanding stock. To help finance the deal, Atari is giving JTS a $ 25 million bridge loan. If the merger collapses, the loan could be converted to JTS preferred stock. TIMELINE FOR ATARI 1972 -- Founded by Silicon Valley pioneer Nolan Bushnell. He got the ball rolling with two of the most successful early arcade games, Pong and Pac-Man. 1975 -- Some 150,000 home versions of Pong are sold. 1976 -- Bushell sells Atari to Warner Communications for $ 28 million. 1978 -- Bushnell leaves Atari to create Chuck E. Cheese pizza parlors. 1980 -- Fueled by the success of its home video system, Atari posts sales of $ 415 million. 1980 -- Atari introduces its first personal computer, which proves to be a money loser. 1983 -- The video game business stalls, leaving Atari $ 533 million in the red. 1984 -- Warner sells Atari to Jack Tramiel, who had been chief executive of Commodore, Atari's rival in the early home computer market. 1986 -- Persistence pays off as low-cost PCs help Atari rebound with a profit of $ 25 million. 1992 -- Atari loses a lawsuit in which it accused Nintendo of monopolizing the video game market. 1993 -- The company reorganizes, stripping away its overseas operations. Revenues drop from a peak of $ 452 million in 1988 to just $ 28.8 million. Late in the year, Atari introduces Jaguar, a video game system that boasts better peformance than Nintendo and Sega systems but costs twice as much. 1994 -- Sega invests $ 40 million in Atari and gets access to the company's patent portfolio. 01/96-- Atari Interactive, a new division, is created to develop games for PCs and other platforms. 02/13-- Atari announces it will merge with JTS, a maker of computer disk drives. ------------------------------------------------------------------------------- Stay tuned to ST News for more information on the Atari/JTS merger. Atari's stock closed at 3 7/8 today -- a dramatic increase from its previous average of 1 1/2 to 2. Dave David Troy --- ToadNet Information Services [dave@toad.net] Toad Computers, Inc. (800) 448-8623 Orders America's Atari Source (410) 544-6943 Info WEB: http://www.toad.net/ (410) 544-1329 FAX FTP: ftp://ftp.toad.net/ (410) 544-6999 BBS ====================================================================== JUGI TANDON's CARTRIDGE DISK FIRM JTS TO REVERSE INTO ATARI JTS Corp, the company formed - by Jugi Tandon, it turns out - to design a very low profile 3" cartridge disk drive with capacities starting at 800Mb, is to go public by reversing into its Sunnyvale, California neighbour Atari Corp under a deal in which Atari shareholders will end up with about 60% of the enlarged company but JTS management will run the combined show. The one thing Atari still has is a significant cash balance, so it is extending a $ 25m bridge loan to JTS, and in the event that the merger is not completed, the loan will be convertible into JTS Series A preferred shares at the option of Atari or JTS. The new company will take the JTS Corp name and the Atari Jaguar games machine business and the JTS disk business will operate as separate divisions. Tom Mitchell, president and chief executive of JTS, was a co-founder of Seagate Technology Inc and president and chief operating officer of both Seagate and Conner Peripherals Inc. JTS's disk drives are to be made by IBM UK Ltd spin-out Xyratex Ltd in Havant (CI Nos 2,568, 2,658). Tandon is best known for his Tandon Corp, originally a floppy disk drive maker that moved into personal computers in pique after IBM Corp terminated a big OEM contract. The most original creation at Tandon was the Data Pac exchangeable cartridge drive: the new JTS is creating a modern successor. ================================================================================ HEADLINE: Atari & JTS To Merge 02/14/96 BODY: SUNNYVALE, CALIFORNIA, U.S.A., 1996 FEB 14 (NB) -- Atari Corp. (AMEX:ATC) and JTS Corporation have agreed to merge the two companies. Atari is the pioneer in multimedia video gaming and JTS is a manufacturer of computer disk drives. Under the terms of the agreement, the new corporation will operate under the name of JTS Corporation and the officers of JTS will become the officers of the merged company. The Atari entertainment business and the JTS disk drive business will operate as separate divisions. Atari has extended a bridge loan to JTS in the amount of $ 25 million. In the event that the merger is not finalized, the bridge loan will be convertible into shares of Preferred Stock at the option of Atari or JTS and subject to "certain conditions." As a result of the transaction, Atari stockholders will hold approximately 60 percent of the outstanding shares of the new company following the merger. The transaction is structured to qualify as a tax-free reorganization. Virginia Walker, chief financial officer for JTS, told Newsbytes, "Contrary to rumors, we do not expect to sell the video game division. It is true, that by naming the new company JTS, and putting the JTS management team in charge, we are announcing that the disk drive manufacturing is expected to be the fastest growing section of the new company." The board of directors of Atari and JTS have approved the definitive agreement. The merger is subject to "certain shareholder and regulatory approvals" and "other conditions" to closing. The parties anticipate the transaction will close toward the end of the second calendar quarter of 1996. JTS was formed in 1994 by Jugi Tandon, the company's current chairman of the board. He will keep that position in the new company. Tom Mitchell, president and chief executive officer of JTS, was a cofounder of Seagate Technology and president and chief operations officer of both Seagate and Conner Peripherals. He will continue as president and chief executive officer with the new company. Founded in 1994, JTS Corporation develops and manufactures hard disk drives for the computer industry. JTS has recently introduced its new three-inch Nordic product for the portable computer market. Headquartered in San Jose, California, with manufacturing facilities in Madras, India, JTS employees 1,300 people worldwide. (Richard Bowers/1996214/Press Contact: Virginia Walker, JTS, 408-468-1800) ================================================================================ Copyright 1996 Star Tribune, Star Tribune February 14, 1996, Metro Edition SECTION: Marketplace; Pg. 8D LENGTH: 330 words HEADLINE: Atari to merge with JTS Corp. in deal valued at $ 78 million; Game firm joins disk-drive maker SOURCE: Bloomberg Business News DATELINE: Sunnyvale, Calif. Atari Corp., the multimedia games company, said Tuesday that it has agreed to merge with JTS Corp., a privately held maker of disk drives in a deal valued at around $ 78 million. Atari, maker of the popular video game Jaguar and other titles playable on Atari's dedicated platform, has met with stiff competition from other games makers such as Sega Corp., as well as from personal computers. An Atari spokesman said the company was looking for a strategic investment. "We had $ 50 million in the bank," said spokesman August Liguori, from Atari headquarters in Sunnyvale, Calif. He said that in the past, Atari had sold computers, printers and other computer components. "To some extent we are going back into the computer business" by merging with JTS. The new entity will be known as JTS Corp., but Atari will remain as a brand name. Under terms of the deal, Atari, which has about 63 million shares outstanding, will issue an additional 40 million shares to JTS shareholders. As a result of the proposed transaction, Atari stockholders would hold about 60 percent of the new company's outstanding shares after the merger, it said. The transaction is structured to qualify as a tax-free reorganization and would be accounted for as a purchase. JTS Chairman Jugi Tandon will be chairman of the merged company. He founded JTS in 1994. Atari Chairman Jack Tramiel will become a JTS board member. Under terms of the deal, Atari has extended a $ 25 million bridge loan to JTS. In the event that the merger is not completed, the loan would be convertible into JTS Series A preferred shares. Both Atari and JTS anticipate the transaction will close toward the end of the second quarter. The Atari entertainment business and the JTS disk drive business will operate as separate divisions of the new merged company. Atari stock was up 18 cents at $ 2.06 on the American Stock Exchange. ================================================================================ More news to follow. Buy your ATC stock now -- it's going up fast! ==================================================================== ToadNet! http://www.toad.net/ info@toad.net ftp://ftp.toad.net/ ==================================================================== Contact us! Is there a product or service you're looking for? We want to know! We are: Toad Computers 570 Ritchie Highway Severna Park, MD 21146-2925 USA Info / International Orders: (410) 544-6943 FAX: (410) 544-1329 USA & Canada Orders: (800) 448-8623 (448-TOAD) Email: info@toad.net or info@toad.net@INET# (GEnie Mail) Also TOAD on Genie Check out our web site! With more than ever before!! http://www.toad.net/ Get the latest WEB BROWSER for the Atari, too! It's available via ftp at ftp://ftp.toad.net/pub/atarist/internet -- check there for the latest version!! Thanks from ALL OF US here at Toad -- Dave, Jennifer, Ray, Tanya, Jo Ann, Jaimie, Dale, Justin, Kathy, Todd, Mark, Stefan, and Zoe the dog! 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