Exhibit 10.2


 


TAX SHARING AGREEMENT


 


This Tax
Sharing Agreement (this “Agreement”), dated as of July 9, 2008, is entered
into by and among Vivendi Holding I Corp., a Delaware corporation (“Vivendi”),
Vivendi Games, Inc., a Delaware corporation (“Vivendi Games”), Activision
Blizzard, Inc., a Delaware corporation (the “Company”) and any other
person who becomes a party to this Agreement in accordance with the terms
hereof.


 


WHEREAS,
Vivendi is the United States parent of the Vivendi Group, and has filed, and anticipates
to continue filing, Vivendi Group Tax Returns;


 


WHEREAS, on December 1,
2007, Vivendi S.A., VGAC LLC, Vivendi Games, the Company and Sego Merger
Corporation entered into a Business Combination Agreement (the “Combination
Agreement”), which provides for, among other things, the combination of the
respective businesses of the Company and Vivendi Games;


 


WHEREAS,
following the consummation of the transactions contemplated by the Combination
Agreement, Vivendi will directly or indirectly own a majority of issued and
outstanding shares of common stock, par value $0.000001 per share of the
Company;


 


WHEREAS,
Vivendi anticipates that, subsequent to the combination of the businesses of
the Company and Vivendi Games pursuant to the Combination Agreement, the
Company, Vivendi Games, and other members of the Company Group may be eligible,
or required, to join with the Vivendi Group in the filing of Vivendi Group Tax
Returns during one or more taxable periods ending on or after the Closing Date
(as defined below); and


 


WHEREAS, the
parties wish to provide for an allocation and indemnification of Tax
liabilities associated with (A) any taxable period during which Company,
Vivendi Games, or other members of the Company Group join with the Vivendi
Group in the filing of Vivendi Group Tax Returns or (B), in the case of Vivendi
Games, any taxable period commencing prior to the combination of the businesses
of the Company and Vivendi Games.


 


NOW,
THEREFORE, in consideration of the foregoing premises and of the mutual
covenants and agreements contained herein, the parties agree as follows:


 


1.                         Definitions.  For purposes of this Agreement, the terms set
forth below shall be defined as follows:


 


(a)           “Adjusted Repatriation Amount” shall have the meaning set
forth in Section 8(d) hereof.


 


(b)           “Adjusted Repatriation Offset” shall have the meaning set
forth in Section 8(d) hereof.


 


(c)           “Adjusted Separate Return Tax Liability” shall have the meaning set
forth in Section 2.4(a) hereof.


 


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(d)           “Closing Date” shall mean July 9,
2008.


 


(e)           “Code” shall mean the Internal Revenue Code of 1986, as amended.


 


(f)            “Company” shall mean Activision Blizzard, Inc., as
defined in the Preamble hereto and any predecessor or successor corporation.


 


(g)           “Company Controlled Tax
Issue” shall have the meaning set forth in Section 6 hereof.


 


(h)           “Company Group” shall mean
the Company and its subsidiaries.


 


(i)            “Company Subgroup” shall mean, in the case of any particular
Determination Year, members of the Company Group that join with the Vivendi
Group in the filing of a Vivendi Group Tax Return.


 


(j)            “Company Subgroup Related Tax Issue” shall have the meaning
set forth in Section 6 hereof.


 


(k)           “Company US Group” shall
mean Company and all United States persons, as defined in Section 7701(a)(3) of
the Code, directly and indirectly wholly-owned by Company.


 


(l)            “Determination Year” shall mean, for any particular member of the
Company Group that joins with the Vivendi Group in the filing of a Vivendi Group
Tax Return for any particular taxable year, the taxable period beginning on or
after the Effective Date for such Company Group member and ending on the
earlier of (i) the last day of such taxable year or (ii) the
Termination Date for such Company Group member.


 


(m)          “Dividend” shall mean a distribution of cash or cash
equivalents that is a “dividend,” as defined in Section 316 of the Code,
and that is includible in the gross income of the recipient for United States
Federal income tax purposes.


 


(n)           “Effective Date” shall mean the later of (A) the date on
which any member of the Company Group commences to be includible in a Vivendi
Group Tax Return and (B) the Closing Date.


 


(o)           “Final Determination” shall mean a final “determination” as
defined under section 1313 of the Code or under any similar provision for state
or local Tax law purposes.


 


(p)           “Group Tax Return” shall mean any consolidated, unitary, or
combined income or franchise Tax Return.


 


(q)           “Investor Agreement” shall mean that “Investor Agreement”
dated as of the date hereof among Vivendi S.A., VGAC LLC, Vivendi Games and
Company.


 


(r)            “Non-Company Vivendi
Group” shall mean all members of the Vivendi Group other than the members of
the Company Group.


 


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(s)           “Non-US Subsidiary” shall mean a foreign corporation for
United States Federal income tax purposes that is directly or indirectly
wholly-owned by Vivendi Games on the Closing Date.


 


(t)            “Non-US
Subsidiary Cash” shall mean, with respect to a Non-US Subsidiary,  the cash and cash equivalents held by the
Non-US Subsidiary on the Closing Date.


 


(u)           “Post-Closing
Earnings” shall mean, with respect to a Non-US Subsidiary as of any particular date upon which such earnings are required to be determined hereunder, an amount equal the aggregate current and accumulated
earnings and profits accumulated from the Closing Date up to and including such
date, without adjustment for any portion of any distribution that qualifies as
Repatriation Amount (or Adjusted Repatriation Amount, as the case may be) hereunder.


 


(v)           “Post-Termination Taxable Period” shall mean any taxable period beginning on or after the Termination Date.


 


(w)          “Pre-Termination Taxable Period” shall mean any taxable period beginning before the Termination Date.


 


(x)            The “Repatriation Amount” attributable to a Dividend shall mean, in
respect of any Non-US Subsidiary, an amount equal to the lesser of (i) the
excess, if any, of (A) the amount of such Dividend, over (B) the
Post-Closing Earnings of such Non-US subsidiary as determined on the date immediately
preceding the distribution date of such Dividend and (ii) the Repatriation
Balance as determined immediately prior to the payment of such Dividend.


 


(y)           The “Repatriation Balance”  shall mean, with respect to a Non-US
subsidiary as of any particular time when a determination of a Repatriation
Balance is required to be made hereunder, the excess, if any, of (i) the
Non-US Subsidiary Cash associated with such Non-US Subsidiary over (ii) the
sum of (A) the aggregate Repatriation Amount (or Adjusted
Repatriation Amount, as the case may be)
attributable to Dividends made by such Non-US Subsidiary after the Closing Date
and immediately prior to such determination, (B) any amount paid by the
Non-US Subsidiary after the Closing Date to acquire an equity interest in any
entity, (C) the net aggregate amount contributed by the Non-US Subsidiary
after the Closing Date as equity to any other entity, (D) the aggregate
amount lent by the Non-US Subsidiary to any other Non-US Subsidiary after the
Closing Date, and (E) any other amount invested by the Non-US Subsidiary
after the Closing Date that is an investment in a capital asset or otherwise
capitalizable for United States Federal income tax purposes.


 


(z)            “Repatriation Cutoff” means the fifth (5th) anniversary of the
Closing Date.


 


(aa)         The “Repatriation Offset”
attributable to a Dividend shall mean an amount equal to fifty percent (50%) of
the Repatriation Tax attributable to such Dividend.


 


(bb)         The “Repatriation Tax” attributable to a Dividend shall mean the
excess, if any, of (i) the aggregate actual or hypothetical (as the case
may be) United States Federal income Tax liability (net of any foreign tax
credits associated with the Repatriation Amount (or Adjusted 


 


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Repatriation Amount, as the case
may be) attributable to such Dividend under sections 901, 902 or 903 of the
Code and allowable to the Company US Group, regardless of whether such credits
are actually claimed) of the Company US Group, determined on an actual or pro
forma basis as if Company were not part of a consolidated group of which it is
not the parent, over (ii) the aggregate hypothetical United States Federal
income Tax liability, determined in the same manner as under clause (i), that
the Company US Group would have incurred if the Repatriation Amount
(or Adjusted Repatriation Amount, as the case may be) attributable to the Dividend had not been distributed.


 


(cc)         “Resolution Accountant” shall have the meaning set forth in Section 7
hereof.


 


(dd)         “Separate Return Tax Liability” shall mean, in the case of any
particular Determination Year, the hypothetical Federal, state, local, or
foreign income or franchise Tax liability, as the case may be, of the Company
Subgroup determined (i) on a pro forma basis, in accordance with Section 2.3
hereof, as if such Company Subgroup had filed their own Group Tax Return for
such year, (ii) taking into account the Tax Items for each previous
Determination Year in respect of which a Separate Return Tax Liability was
determined for such members, and, (iii) if applicable, as adjusted
pursuant to Section 8(a) hereof.


 


(ee)         “Tax” or “Taxes” shall mean
all federal, state, local, foreign and value-added taxes, and other assessments
of a similar nature (whether imposed directly, through withholding, or in the
nature of a sales or value added tax), including any interest, additions to
Tax, or penalties applicable thereto, imposed by any Tax Authority.


 


(ff)           “Tax Contest” shall mean
any audit, assessment of Tax, other examination by any Taxing Authority, or any
proceeding or appeal of such proceeding.


 


(gg)         “Tax Items” shall mean any item
of income, gain, loss, deduction, expense, Tax credit, Tax basis, capitalized
cost, or any related carryover or carryback Tax Items or other Tax attributes
that may have the effect of increasing or decreasing the determination of the
Tax liability of a person for any particular taxable period.


 


(hh)         “Tax Return” shall mean any return, report, or information
statement (including all exhibits and schedules thereto), in respect of any
Tax, that has been, or is required to be, filed with a Taxing Authority.


 


(ii)           “Taxing Authority” shall
mean any governmental authority having jurisdiction over the imposition,
determination, assessment, or collection of any Tax.


 


(jj)           “Termination Event” shall mean, for any particular member of the
Company Group that has joined with the Vivendi Group in the filing of a Vivendi
Group Tax Return, any event pursuant to which such member ceases to be
includible in a Vivendi Group Tax Return.


 


(kk)         “Termination Date” shall mean, for any particular member of the
Company Group that has joined with the Vivendi Group in the filing of a Vivendi
Group Tax Return, the date on which a Termination Event occurs.


 


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(ll)           “Vivendi” shall mean Vivendi Holding I Corp., as defined in the
Preamble hereto and any predecessor or successor corporation.


 


(mm)       “Vivendi Controlled Tax Issue” shall have the meaning set forth in Section 6
hereof.


 


(nn)         “Vivendi Games” shall mean
Vivendi Games, Inc., as defined in the Preamble hereto and any predecessor
or successor corporation.


 


(oo)         “Vivendi Group” shall mean, for any particular taxable year, Vivendi and any
other corporation that has joined, or will join, with Vivendi in the filing of
a Vivendi Group Tax Return.


 


(pp)         “Vivendi Group Tax Return”
shall mean any Group Tax Return of the Vivendi Group.


 


(qq)         “Vivendi Group Taxable Year”
shall mean each taxable year commencing after, or including, the Closing Date,
in respect of which (i) a Vivendi
Group Tax Return is permitted or required to be filed and (ii) such
Vivendi Group Tax Return includes one or more members of the Company Group.


 


2.                         Vivendi
Group Tax Returns.


 


2.1           Filing
by Vivendi.  For each taxable period
during which a member of the Company Group is eligible, or required, to join
with the Vivendi Group in the filing of a Vivendi Group Tax Return, Company
shall, and shall cause each relevant Company Group member to, (A) consent
to and join with the Vivendi Group in the filing of any Vivendi Group Tax
Return as Vivendi may elect or be required to file, (B) become a party to
this Agreement, and (C) execute such documents and take such actions as
Vivendi may reasonably request in connection with such filing.  For each such Vivendi Group Taxable Year,
Vivendi shall file the Vivendi Group Tax Return on a timely basis.


 


2.2           Payment
of Tax Liability.  Company shall
timely pay to the appropriate Taxing Authority or discharge any Taxes required
to be paid by any member of the Company Group. 
For each Vivendi Group Taxable Year, Vivendi shall timely pay or
discharge, or cause to be timely paid or discharged, the Tax liability of the
Vivendi Group for such taxable year to the extent such liability is not
required to be paid or discharged by Company pursuant to this Section 2.2.


 


2.3           Separate
Return Tax Liability.  At least 60
days prior to the due date (taking into account any applicable extensions) for
the filing of a Vivendi Group Tax Return in respect of which a member of the
Company Group is included in such filing, Company shall furnish to Vivendi a
written calculation in reasonable detail setting forth the amount of the
Separate Return Tax Liability for the Company Subgroup, which calculation shall
be subject to the reasonable review and approval of Vivendi.  In the case of estimated payments of Tax, the
Company Subgroup shall make a reasonable estimate of the Separate Return Tax
Liability (the “Estimated Separate Tax Return Liability”) for the Company
Subgroup after good faith consultation with Vivendi and pay such estimated
amount to Vivendi at the time specified in 


 


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Section 2.5 hereof.  Any
dispute with respect to such calculations shall be ultimately resolved in
accordance with the determination of Company’s independent public accountants; provided, however,
that if Company’s independent public accountants determine that making any such
recommendation may conflict with their status of remaining independent, such
dispute shall be ultimately resolved in accordance with the determination of
the tax group of another independent accounting firm of national reputation
with expertise in the area of tax law relevant to such dispute selected by
Company.  In the
case of any particular Determination Year, Company shall pay Vivendi or Vivendi
shall pay to Company, as the case may be, an amount equal to the difference
between (A) the Separate Return Tax Liability for the Company Subgroup, as
determined in this Section 2.3 for such year, and (B) the aggregate
of (i) the amount actually paid by Company to any Taxing Authorities for
such year, plus, (ii) without duplication of the amounts described in
clause (B)(i) of this sentence, the total payments in respect of the
Estimated Separate Tax Return Liability for such year.


 


2.4           Adjustments.


 


(a)       Subject to Section 6 hereof, if (I) as
a result of any Final Determination, the Tax of the Vivendi Group for a Vivendi
Group Taxable Year is subsequently increased or decreased from the amount shown
on a return, amended return, or refund claim or (II) as a result of any
change in any Tax Item that affects the calculation under Section 2.3
hereof, the Vivendi Group files an amended Vivendi Group Tax Return, then a
recalculation of the Separate Return Tax Liability shall made (the “Adjusted
Separate Return Tax Liability”).  Company
(or the relevant member of the Company Subgroup) shall pay to Vivendi, or
Vivendi shall pay to Company (or the relevant member of the Company Subgroup),
as the case may be, an amount equal to the difference between the Separate
Return Tax Liability and the Adjusted Separate Return Tax Liability, as the
case may be.


 


(b)       Any out-of-pocket expenses incurred in
connection with an adjustment described in Section 2.4(a) hereof shall be
borne by the party incurring such expense. 
Any interest or penalties arising from any such adjustment shall be
equitably allocated between the Vivendi Group and the relevant Company Subgroup
to reflect the extent to which such interest or penalties are associated with
the Tax Items of the members of the Vivendi Group or the Company Subgroup.  Company, or the relevant member of the
Company Subgroup, shall pay to Vivendi an amount equal to a portion of such
interest or penalties allocable to the Company Subgroup.


 


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2.5           Timing of Payments.


 


(a)       In the case of any amount required to be
paid by Company, or the relevant member of the Company Subgroup, to Vivendi
pursuant to Sections 2.3 and 2.4 hereof, (i) Vivendi shall furnish to
Company written notice of its intention to make a corresponding payment
(including estimated payments of Tax) to the relevant Taxing Authority or, in
the case of an out-of-pocket expense, the relevant service provider, no earlier
than seven (7) business days prior to the date upon which Vivendi intends
to make such corresponding payment, and (ii) Company shall make payment to
Vivendi no later than three (3) business days after receipt of such
written notice from Vivendi.


 


(b)       Any amount required to be paid by Vivendi
to Company, or the relevant member of the Company Subgroup, pursuant to Section 2.3
hereof shall be made no later than the date of the filing of the relevant Vivendi
Group Tax Return.  Any amount required to
be paid by Vivendi to Company, or the relevant member of the Company Subgroup,
pursuant to Section 2.4 shall be made no later than two (2) business
days following the date upon which Vivendi receives a corresponding payment or
credit from the relevant Taxing Authority.


 


(c)       The parties hereto intend that all
amounts required to paid by one party to the other party hereunder shall be
paid in full when due.  In the event that
any such amount is not paid on or prior to the due date hereunder, such amount
shall bear interest, during the period that such amount remains due and owing,
at a rate equal to the short-term applicable Federal rate for such period as
defined under section 6621(a)(2) under the Code and determined by the
Internal Revenue Service from time to time.


 


3.                         Termination
Event.  Upon a Termination Event,
Vivendi and Company shall cooperate in determining an equitable allocation of
any Tax Items between the Vivendi Group and the member of the Company Subgroup
relevant to the Termination Event.  To
the extent permitted by applicable law, Tax Items shall be allocated to such
Company Subgroup member to the extent that such member bears, or has borne, the
Tax liability associated with such Tax Item under Sections 2.3 or 2.4 hereof
or, in the case where no party is required hereunder to bear such liability,
the party that incurred the cost or burden associated with the creation of such
Tax Item.


 


4.                         Continuing
Covenants.  Unless otherwise required
by applicable law, each of Vivendi (for itself and for the Non-Company Vivendi
Group) and Company (for itself and the Company Group) agrees not to take any
action in connection with any Tax Return or settlement of any Tax Contest that
is reasonably expected to result in an increased Tax liability to the other, a
reduction in a beneficial Tax Item of the other or an increased liability to
the other under this Agreement.


 


5.                         Indemnification.


 


(a)       Vivendi shall be liable for, and shall
indemnify, defend, and hold harmless the members of the Company Group from and
against all Taxes imposed on the Company Group as a result of a failure of
Vivendi to pay or discharge an amount required to be paid by Vivendi pursuant
to Sections 2.2, 2.3 or 2.4, but such liability shall be reduced and offset by
any amounts owed by Company to Vivendi pursuant to Sections 2.3 and 2.4.


 


(b)       Vivendi shall be liable for, and shall
indemnify, defend, and hold harmless the members of the Company Group from and
against all Taxes in respect of Vivendi Games arising from, in connection with,
or


 


7



















 


related to any Tax
period commencing prior to the combination of the businesses of Company and
Vivendi Games, in excess of the amount specifically designated as a reserve for
any such Tax as set forth on the Vivendi Games 6/30/08 Balance Sheet; provided,
however, Vivendi does not make any representation as to or warrant or
guarantee the existence or value of any net operating losses, credits, or other
tax attributes of any member of the Vivendi Group (including Vivendi Games and
any of its subsidiaries).


 


(c)       Vivendi shall be liable for, and shall
indemnify, defend, and hold harmless the members of the Company Group from and
against all Taxes arising from, in connection with, or related to the
application and effect of the preclusion, or subsequent disallowance by the
Internal Revenue Service or other Tax authority, of any deduction as an “excess
parachute payment” under section 280G of the Code (or similar state or local
Tax law), and any withholding Tax liability associated therewith under section
4999 of the Code (or similar state or local Tax law), relating to any payment
or benefit (a) in effect on or prior to the Closing Date and provided
under any Vivendi or Vivendi Games compensatory or similar arrangement and (b) arising
by virtue of the consummation of the transactions contemplated by the
Combination Agreement.


 


(d)       Company shall be liable for, and shall
indemnify, defend, and hold harmless the members of the Non-Company Vivendi
Group from and against all Taxes imposed on the Non-Company Vivendi Group as a
result of a failure of Company to pay or discharge an amount required to be
paid by Company pursuant to Sections 2.2, 2.3 or 2.4, but such liability shall
be reduced and offset by any amounts owed by Vivendi to Company pursuant to Section 2.3
and 2.4.


 


Any indemnification payment required to be
made pursuant to this Section 5 shall be due and payable promptly upon
receipt of delivery of written notice thereof.


 


6.                         Tax
Contests.  In the case of any Tax
Contest pertaining to any Vivendi Group Tax Return which includes one or more
members of the Company Group, Vivendi shall (i) keep Company reasonably
informed of the material issues arising during the course of such contest that
could be reasonably anticipated to affect the determination of the Tax
liability of any member of the Company Subgroup under Section 2.4 hereof
(a “Company Subgroup Related Tax Issue”) and furnish to Company a copy of all
written communications, documents, and other material writings related to such
issues and (ii) have the right to control the course of such contest (a “Vivendi
Controlled Tax Issue”); provided, however, that in the case of
any Company Subgroup Related Tax Issue which focuses primarily on a Tax Item of
a member of the Company Subgroup, Company shall have the right to control the
course of such contest (a “Company Controlled Tax Issue”).  Vivendi shall not settle a Vivendi Controlled
Tax Issue and Company shall not settle a Company Controlled Tax Issue without
the consent of the other party, which consent shall not be unreasonably
withheld; provided, however, that (A) Vivendi may elect to
settle a Vivendi Controlled Tax Issue without the consent of Company, in which
case Vivendi shall have no right to receive any payment from Company in
connection with such settlement pursuant to Section 2.4 hereof in excess
of any amount to which Company has consented pursuant to this sentence, and (B) Company
may elect to settle a Company Controlled Tax Issue without the consent of
Vivendi, in which case Company shall have no right to receive 


 


8

















 


any payment from Vivendi in connection with such settlement pursuant to
Sections 2.4 or 5(b) hereof in excess of any amount to which Vivendi has
consented pursuant to this sentence.


 


7.                         Dispute
Resolution.  Except as provided in Section 2.3
hereof, in the event that Vivendi and Company disagree as to the determination
of amount of any payment, or any other determination or calculation, permitted
or required to be made under this Agreement, the parties shall attempt in good
faith to resolve such dispute.  If the
parties cannot resolve the dispute within sixty (60) days following the
commencement of the dispute, Vivendi and Company shall jointly retain a
nationally recognized accounting firm mutually agreeable to the parties (the “Resolution
Accountant”), to resolve the dispute. 
The Resolution Accountant shall determine the correct amount, or any
other matter, that is the subject of the dispute which determination shall be
final.  The fees payable to the
Resolution Accountant shall borne by each of Vivendi and Company as equitably
determined by the Resolution Accountant.


 


8.                         Cash
Repatriation.  If a Non-US Subsidiary
makes a Dividend to a member of the Company US Group after the Closing Date and
before the Repatriation Cutoff, the following rules shall apply:


 


(a)       If the Dividend is made on a date that is
included in a Determination Year of Vivendi Games, the amount of Separate
Return Tax Liability (or Adjusted Separate Tax Return Liability,
as the case may be) for such Determination Year
shall be reduced by the amount of the Repatriation Offset attributable to such
Dividend.  The parties hereto agree to treat
any reduction of the Separate Return Tax Liability made pursuant to this Section 8(a) for
Tax purposes as an adjustment to the purchase price of the Company shares
acquired by Vivendi and its affiliates pursuant to the Combination Agreement.


 


(b)       If the Dividend is made on a date that is
not included in a Determination Year of Vivendi Games, Vivendi shall pay (or
cause a subsidiary of Vivendi that is not Company or a subsidiary of Company to
pay) to Company an amount equal to the Repatriation Offset attributable to such
Dividend no later than ten (10) business days after Vivendi receives
notice from Company of the amount of the Repatriation Offset.  The parties hereto agree to treat any payment
made pursuant to this Section 8(b) for Tax purposes as an adjustment
to the purchase price of Company shares acquired by Vivendi S.A. and its
affiliates pursuant to the Combination Agreement.


 


(c)       In the case of any particular
distribution paid, or proposed to be paid, by a Non-US Subsidiary to the
Company in respect of which the Company is, or would become, entitled to
receive a Repatriation Offset hereunder, the Company shall furnish to Vivendi a
written description of the determination of such Repatriation Offset, setting
forth in reasonable detail the computation of such Repatriation Offset, which
calculation shall be subject to the reasonable review and approval of
Vivendi.  Any dispute with respect to
such calculation shall be ultimately resolved in accordance with Section 7
hereof.


 


(d)       With respect to any Dividend
made on a date that is not included in a Determination Year of Vivendi Games,
if, prior to the third anniversary of the Repatriation Cutoff, (I) as a
result of any Final Determination, the amount of the Repatriation Tax
associated with such Dividend is subsequently increased or decreased from the
amount determined at the 


 


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time of the payment of the amount of the
Repatriation Offset or (II) as a result of any change in any Tax Item that
affects the calculation of the Repatriation Tax associated with such Dividend,
Vivendi Games (or the parent of the consolidated group of which Vivendi Games
is not the parent) files an amended Tax Return for the taxable year that
includes such Dividend; then a recalculation of the Repatriation Amount
attributable to such Dividend shall be made (the “Adjusted Repatriation Amount”)
and a recalculation of the Repatriation Offset attributable to such Dividend
shall be made (the “Adjusted Repatriation Offset”).  As soon as reasonably practicable after such
determination is made, Company shall pay to Vivendi, or Vivendi shall pay (or
cause a subsidiary of Vivendi that is not Company or a subsidiary of Company to
pay) to Company, as the case may be, an amount equal to the difference between
the Repatriation Offset and the Adjusted Repatriation Offset, as the case may
be.


 


(e)       With respect to any
Dividend made before the earlier of (i) the Repatriation Cutoff and (ii) the
time when the Repatriation Balance is reduced to zero, the Company hereby
agrees that (1) it shall be entitled to a reduction of its Separate Return
Tax Liability (or Adjusted Separate Return Tax Liability, as the case may be)
pursuant to subsection (a) hereof by, or the receipt of, a Repatriation
Offset (or Adjusted Repatriation Offset, as the case may be) in respect of any
Dividend only if it would have made such Dividend, with respect to both amount
and timing, regardless of the availability of a reduction by or receipt of the
Repatriation Offset, including in connection with any reorganization,
restructuring transaction, sale of substantially all assets or similar
transaction; and (2) it shall be entitled to a reduction of its Separate
Return Tax Liability (or Adjusted Separate Return Tax Liability, as the case may
be) pursuant to subsection (a) here of by, or the receipt of, a
Repatriation Offset (or Adjusted Repatriation Offset, as the case may be) in
respect of any transaction or series of transactions only if, and to the extent
that, such transaction or series of transactions that gives, or is deemed to
give, rise to a Dividend for United States Federal income Tax purposes also
results in a reduction in the net asset value of the relevant Non-US
Subsidiary.


 


9.                         Non-US
Subsidiary Cash.  Attached as
Appendix A to this Agreement is a schedule of the estimated Non-US Subsidiary
Cash of each Non-US Subsidiary.  As soon
as practicable after the Closing Date, the actual Non-US Subsidiary Cash of
each Non-US Subsidiary shall be determined, and the schedule in Appendix A
shall be replaced with a schedule showing the actual Non-US Subsidiary Cash of
each Non-US Subsidiary.


 


10.                       Term.  This Agreement shall continue in full force
and effect until such time that the parties hereto agree in writing to
terminate this Agreement.


 


11.                       Notices.  All payments, notices, demands, or
communications required or permitted to be given hereunder shall be effective
upon delivery and may be delivered via personally delivery, email transmission,
facsimile transmission, Federal Express or a similar courier service, certified
mail, or in the case of payment, wire transmission.  A form of delivery based upon a street
addressed, may be directed to the following addresses:


 


to Vivendi:


 


[local
address]


 


10

















 


to Vivendi
Games:


 


[local
address]


 


to Activision
Blizzard:


 


[local
address]


 


or to such other address or to the attention of such other person as a
party may, from time to time, designate by written notice to the other party.


 


12.                       Amendment
of Agreement.  This Agreement may not
be amended, supplemented or discharged, except by an instrument in writing
signed by all parties hereto.


 


13.                       Successors
and Assigns.  This Agreement shall be
binding upon, and inure to the benefit of Vivendi, Vivendi Games, Company, and
their respective successors and assigns and any reference herein to Vivendi,
Vivendi Games, and Company shall be deemed to include their respective
successors and assigns.


 


14.                       Severability.  If any term, provision, covenant, or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, void, or unenforceable, (i) the remainder of the terms,
provisions, covenants, and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired, or invalidated and (ii) the
parties hereto shall use their best efforts to find and employ an alternate
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant, or restriction.


 


15.                       Further
Assurances.  The parties hereto shall
make, execute, acknowledge, and deliver such other instruments and documents,
and take all such other actions, as may be reasonably required in order to
effectuate the purposes of this Agreement and to consummate the transactions
contemplated hereby.


 


16.                       Waivers.  No failure or delay on the part of the
parties in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power,
or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any right or
power.  No modification or waiver of any
provision of this Agreement nor consent to any departure by the parties
therefrom shall in any event be effective unless the same shall be in writing,
and then such a waiver or consent shall be effective only in the specific
instance and for the purpose for which given.


 


17.                       Setoff.  All payments to be made by any party under
this Agreement shall be made without setoff, counterclaim, or withholding, all
of which are expressly waived.


 


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18.                       Headings.  Descriptive headings are for convenience only
and shall not control or affect the meaning or construction of any provision of
this Agreement.


 


19.                       Counterparts.  For the convenience of the parties, any
number of counterparts of this Agreement may be executed by the parties hereto,
and each such executed counterpart shall be, and shall be deemed to be, an
original instrument.


 


20.                       Effect
of this Agreement.  This Agreement
and Sections 4.1(c) and (d) of the Investor Agreement shall supersede
any other Tax sharing arrangement or agreement in effect between the parties to
this Agreement.


 


21.                       Entire
Agreement.  Except as provided in
this Section 21, this Agreement constitutes the entire Agreement among the
parties relating to the allocation of the Tax liabilities of the Vivendi Group
in respect of a Determination Year. 
Notwithstanding any provision in this Agreement, (i) the allocation of any value added tax liabilities
incurred pursuant to the Cash Management Services Agreement entered into by and
among Vivendi S.A., Company and Vivendi Games Treasury S.A.S. dated on or about
the date hereof (or any successors thereto) shall be governed by such Cash
Management Services Agreement (or successor thereto) and (ii) any
payments required to be made in respect of Taxes described in the
$1,025,000,000 Credit Agreement entered into among Company and Vivendi S.A.
dated on or about April 29, 2008 hereof (or any successors thereto) shall
be governed by such Credit Agreement (or
successor thereto).


 


22.                       Governing
Law.  This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware.


 


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  Vivendi Holding I Corp.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E. Bushnell III

  
	
   

  	
   

  	
  Name:

  	
  George E. Bushnell III

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date: 
  July 9, 2008

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Vivendi Games, Inc.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce L. Hack

  
	
   

  	
   

  	
  Name:

  	
  Bruce L. Hack

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date: 
  July 9, 2008

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Activision Blizzard, Inc.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert. A. Kotick

  
	
   

  	
   

  	
  Name:

  	
  Robert A.
  Kotick

  
	
   

  	
   

  	
  Title:

  	
  President and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date:  July 9, 2008

  
					



 


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APPENDIX A


 


[Non-US
Subsidiary Cash]


 


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