rather astonished. Usually paralegals didn’t speak up at meetings. “I think I know what it is. He wants your game engine. ” Sarah realized that she had spoken out of turn. “Sorry.”
Birnbaum said, “No, go on.”
“Well think about it. Gryphon World just acquired Boneset’s physics programmer for the next game in their frontline title. It stands to reason that they want a new game engine as well. Byrne likes your game engine a lot. And taking control of your company, while expensive, takes less time and money than building an engine from the ground up. Plus you have other assets he can exploit.”
Aaron looked at Sarah with new respect. “Makes sense.” Birnbaum looked at Jim. “So can we stop it?”
“Well, it’s too late t o construct a poison pill, and a Pac-Man defense won’t work either,” Jim said.
“Pac-Man defense. What’s that?” Birnbaum asked.
Jim rubbed his eyes. “That’s where you start buying up the other guy’s stock to get a majority vote in his company. You don’t have that kind of money, and I think Byrne maintains a fifty-one percent control of Gryphon World Stock. So that’s out.”
“What about a Crown Jewel Defense?” Sarah asked Jim.
Jim looked at her. He thought about it and nodded. “Painful but possible.”
Birnbaum looked expectantly at the two of them. Jim said, “It’s where you sell th e asset Gryphon World wants to someone else, preferably a friendly competitor, one who will license back your product at a reasonable price once the danger has passed. In this case, it would be your game engine.”
“Shit!” Birnbaum exploded. “ We have to sell off our most valuable asset in order to keep our company?”
“In order to try and keep your company. There may be other assets he wishes to acquire in your organization as well. Or he may have other reasons for buying you up. Selling your game engine may not be enough to put them off.” Jim read through Rainwhite’s by-laws. “How much is your game engine worth?” Birnbaum mentioned a figure. “Well then, that lies within the discretionary amount allowed by your by-laws. Your current Board of Directors has the authority to sell or exclusively lease out your game engine without a stockholder vote. But we only have forty-eight hours until the next stockholder’s meeting. I’m willing to bet that’s when Gryphon will make its move.”
The Rainwhite people looked stricken. Most were game designers, artists, programmers and writers , and few of them understood business.
Jim and Sarah looked at each other. When Jim decided to make this move and become Rainwhite’s in-house counsel, he’d done so knowing that the first order of business would have to be doing what was needed to protect the company against what appeared to be happening. Unfortunately for them all, Eamon Byrne, ha d seen their weaknesses as well and had acted before they could.
“So, is there any company who is in a position to purchase your game engine?”
Birnbaum leaned forward and put his arms on the conference table. “Perhaps.”
Gryphon World Inc.
Martin came rushing into Eamon’s office. “We have a problem.”Eamon looked up from the report he’d been study ing. When his eyes met Martin’s, his lawyer continued. “I just got a call from Tom over at Cyclone systems. Rainwhite has offered to sell him their game engine.”
Eamon winced. He leaned forward, his elbows on his desk and his hands under his chin as he mentally ran numbers in his head.
“Tom wouldn’t have called unless he was willing to deal,” he said, more to himself than to Martin. Cyclone Systems was a small sole proprietorship just getting on its feet. Buying that game engine would be tempting. The license fees would be a steady income stream, but it probably would take all of Tom’s capital and then some. He’d need financial backing. “Get Tom on the phone and let’s see what he wants.”
Eamon was connected with the owner of Cyclone Systems a