Exhibit 10.3

 

EXECUTION VERSION

 


	
MERRILL LYNCH, PIERCE, FENNER & SMITH   INCORPORATED
   BANK OF AMERICA, N.A.
   One Bryant Park
   New York, NY 10036
    	
 
    	
JPMORGAN CHASE BANK, N.A.
    270 Park Avenue
    New York, New York 10017

 

J.P. MORGAN SECURITIES LLC
    383 Madison Avenue
    New York, New York 10179
    




 

PERSONAL AND CONFIDENTIAL

 

July 25, 2013

 

Activision Blizzard, Inc.
 3100 Ocean Park Boulevard

Santa Monica, CA 90405

 

Attention:  Dennis Durkin, Chief Financial Officer

 

Project Amber
 Commitment Letter

 

Ladies and Gentlemen:

 

We are pleased to confirm the arrangements under which each of Bank of America, N.A. (“Bank of America”), Merrill Lynch (as defined below), JPMorgan Chase Bank, N.A. (“JPMCB”) and J.P. Morgan Securities LLC (“J.P. Morgan”) (together with any Additional Agents appointed in accordance with Section 1, collectively, the “Commitment Parties” or “we” or “us”) is exclusively authorized by Activision Blizzard, Inc., a Delaware corporation (the “Company” or “you”), to act as joint lead arranger and joint bookrunner, in connection with the financing for certain transactions described herein, in each case on the terms set forth in this commitment letter and the attached Annexes A, B, C, D and E hereto (collectively, this “Commitment Letter”). Capitalized terms used but not defined herein have the respective meanings given in the Annexes hereto.  For purposes of this Commitment Letter, “Merrill Lynch” shall mean Merrill Lynch, Pierce, Fenner & Smith Incorporated and/or any of its designated affiliates.

 

You have informed the Commitment Parties that the Company intends to buy back approximately 428,676,471 shares of the capital stock of the Company currently held by a wholly-owned subsidiary of Vivendi, S.A. (“Vivendi”) via the purchase of a newly-formed entity (“Newco”) that will hold such stock on or prior to the Closing Date (the “Stock Buy-Back”) pursuant to the Stock Purchase Agreement, dated as of July 25, 2013, by and among the Company, ASAC II LP, an exempted limited partnership organized under the laws of the Cayman Islands (“ASAC”) and Vivendi (together with any schedules and exhibits thereto, the “Purchase Agreement”), and the date of consummation of the Stock Buy-Back referred to herein as the “Closing Date”.  You have informed us that (a) the Stock Buy-Back and (b) the payment of fees and expenses in connection with the Stock Buy-Back will be financed from the following sources:

 

·                  available domestic cash of the Company and its subsidiaries (“Domestic Cash”);

 

·                  senior secured credit facilities in an aggregate principal amount of $2,500 million, comprised of a $2,250 million term loan B facility (the “Term B Facility”) and a $250

 











 

million revolving credit facility (the “Revolving Facility”, together with the Term B Facility, the “Senior Secured Facilities”) having the terms set forth on Annex B; and

 

·                  the issuance by the Company of $1,000 million of high yield first lien secured securities (the “Secured Notes”) and $1,500 million of high yield unsecured securities (the “Unsecured Notes”; together with the Secured Notes, the “Notes”) pursuant to a Rule 144A (without registration rights) or other private placement (the “Notes Offering”) or, in the event some or all of the (x) Unsecured Notes are unable to be issued at the time the Stock Buy-Back is consummated, borrowings by the Company of unsecured senior increasing rate bridge loans in an aggregate principal amount of $1,500 million, less the gross proceeds from the sale of Unsecured Notes issued on or prior to the Closing Date (the “Unsecured Bridge Loans”) or (y) Secured Notes are unable to be issued at the time the Stock Buy-Back is consummated, borrowings by the Company of first lien secured senior increasing rate bridge loans in an aggregate principal amount of $1,000 million, less the gross proceeds from the sale of Secured Notes issued on or prior to the Closing Date (the “Secured Bridge Loans”, and together with the borrowings under the Unsecured Bridge Loans, the “Bridge Loans”, and under the Senior Secured Facilities, the “Loans”, and the “Bridge Facilities”, together with the Senior Secured Facilities, the “Facilities”) having the terms set forth on Annexes C and D, as applicable.

 

1.                                      Commitments; Titles and Roles.

 

In connection with the foregoing, each of Bank of America and JPMCB (in such capacity, each an “Initial Lender” and collectively the “Initial Lenders”) is pleased to confirm its several, but not joint, commitment to provide 50% of the Senior Secured Facilities and 50% of the Bridge Facilities, in each case subject only to the satisfaction or waiver of the applicable conditions set forth in the sections entitled “Conditions Precedent to Initial Borrowing” in Annex B hereto, “Conditions Precedent to Borrowing” in Annex C  hereto, “Conditions Precedent to Borrowing” in Annex D  hereto and “Conditions Precedent to the Facilities” in Annex E hereto.

 

Each of Merrill Lynch and J.P. Morgan is pleased to confirm its commitment to act, and you hereby appoint each of Merrill Lynch and J.P. Morgan to act (i) as joint lead arranger and joint bookrunner for the Senior Secured Facilities (each a “Bank Lead Arranger”, and together with any Additional Arrangers appointed in accordance with this Section 1, collectively, the “Bank Lead Arrangers”) and (ii) as joint lead arranger and joint bookrunner for the Bridge Facilities (each a “Bridge Lead Arranger”, and together with any Additional Arrangers appointed in accordance with this Section 1, collectively, the “Bridge Lead Arrangers”, and together with the Bank Lead Arrangers, the “Arrangers”). In addition, you hereby appoint (x) Bank of America to act as administrative agent and collateral agent for the Senior Secured Facilities (the “Bank Administrative Agent”) and (y) JPMCB as administrative agent for the Bridge Facilities (the “Bridge Administrative Agent”, together with the Bank Administrative Agent, the “Administrative Agents”).  You agree that (x) Merrill Lynch will have “left” placement in any and all marketing materials or other documentation used in connection with the Senior Secured Facilities or other documentation used in connection with the Senior Secured Facilities and (y) J.P. Morgan will have “left” placement in any and all marketing materials or other documentation used in connection with the Bridge Facilities or other documentation used in connection with the Bridge Facilities.  You further agree that no other titles will be awarded and no compensation (other than that expressly contemplated by this Commitment Letter and the Fee Letter referred to below) will be paid in connection with the Facilities unless you and we shall so agree; provided that, you may, within 10 days following the date hereof, appoint additional agents, co-agents, lead arrangers, bookrunners, managers or arrangers or confer other titles in respect of either Facility (each such agent, co-agent, lead arranger, bookrunner, manager, arranger

 

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or titled institution, an “Additional Agent”) in a manner and with economics determined by you and acceptable to such Additional Agents; provided, further that (v) you may not appoint more than two (2) additional arrangers and bookrunners for both Facilities (such additional arrangers and bookrunners, the “Additional Arrangers”), (w) you may not allocate more than 20% of the total economics in respect of either Facility to the applicable Additional Agents (or their affiliates), (x) each such Additional Agent (or its affiliate) shall commit ratably across all of the Facilities, (y) each such Additional Agent (or its affiliate) shall assume a proportion of the commitments with respect to the relevant Facility that is equal to the proportion of the economics allocated to such Additional Agent (or its affiliates) for the relevant Facility, and (z) to the extent you appoint (or confer titles on) Additional Agents, the economics allocated to, and the commitment amounts of, the Initial Lenders, for the relevant Facility will be proportionately reduced by the amount of the economics allocated to, and the commitment amount of, each such Additional Agent (or its affiliate) for the relevant Facility, in each case upon the execution and delivery by such Additional Agent of customary joinder documentation (which may be in the form of an amendment and restatement of this Commitment Letter and the Fee Letter) reasonably acceptable to you and us and, thereafter, each such Additional Agent shall constitute a “Commitment Party,” “Initial Lender” and “Arranger,” as applicable, under this Commitment Letter and under the Fee Letter.  The commitments of the Initial Lenders and any other such Additional Agents will be several and not joint. Our fees for our commitment and for our services related to the Facilities are set forth in a separate fee letter (the “Fee Letter”) entered into by the Company and each Commitment Party on the date hereof.  You acknowledge that we may receive a benefit, including without limitation, a discount, credit or other accommodation, from any of such counsel based on the fees such counsel may receive on account of their relationship with us including, without limitation, fees paid pursuant hereto.

 

2.                                      Conditions Precedent.

 

Each Commitment Party’s commitment and agreements hereunder are subject to (i) the conditions set forth on Annex E hereto, (ii) with respect to the Senior Secured Facilities, the conditions set forth in Annex B under the heading titled “Conditions Precedent to Initial Borrowing”, (iii) with respect to the Bridge Facilities, the conditions set forth in Annexes C and D under the heading titled “Conditions Precedent to Initial Borrowing” and (iv) except as has been disclosed in the Company’s public filings with the SEC as of the date hereof (excluding any risk factor disclosures set forth under the heading “Risk Factors” or any disclosure of risks included in any “forward-looking statements” disclaimer to the extent that such disclosures are general in nature, or cautionary, predictive or forward-looking in nature), since December 31, 2012, there has not occurred any event that has had or would reasonably be expected to have a Company Material Adverse Effect (as defined below).

 

As used in this Section 2, “Company Material Adverse Effect” means any fact, effect, change, event or circumstance that (i) materially adversely affects the business, financial condition or results of operations of the Company and its subsidiaries, taken as a whole; provided, however, that any fact, effect, change, event or circumstance arising from or related to (except, in the case of clauses (a), (b), (c), (d), (e), (f) or (i) below, to the extent disproportionately affecting the Company and its subsidiaries, taken as a whole, relative to other companies in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate effect shall be taken into account): (a) conditions affecting the United States economy, or any other national or regional economy or the global economy generally, (b) political conditions (or changes in such conditions) in the United States or any other country or region in the world or acts of war, sabotage or terrorism (including any escalation or general worsening of any such acts of war, sabotage or terrorism) in the United States or any other country or region of the world occurring after the date hereof, (c) changes in the financial, credit, banking or securities markets in the United States or any other country or region in the world (including any disruption thereof and any decline in the price of any security or any market index), (d) changes required by United States generally

 

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accepted accounting principles or other accounting standards (or interpretations thereof), (e) changes in any laws or other binding directives issued by any governmental entity (or interpretations thereof), (f) changes that are generally applicable to the industries in which the Company and its subsidiaries operate, (g) any failure by the Company to meet any internal or published projections, forecasts or revenue or earnings predictions for any period ending on or after the date of the Purchase Agreement or any decline in the market price or trading volume of the Company’s stock (provided that the underlying causes of any such failure or decline may be considered in determining whether a Company Material Adverse Effect has occurred or would reasonably be expected to occur to the extent not otherwise excluded by another exception herein), (h) the public announcement or consummation of the Stock Buy-Back or any of the transactions contemplated by the Purchase Agreement (including as to the identity of the parties thereto), (i) the occurrence of natural disasters or (j) any action required by the terms of the Purchase Agreement or with the prior written consent or at the direction of the other parties thereto and the Arrangers, shall not be taken into account in determining whether a Company Material Adverse Effect has occurred or would reasonably be expected to occur, or (ii) would prevent the Company from consummating the transactions contemplated by the Purchase Agreement.

 

Each Commitment Party’s commitment and agreements hereunder are subject to the satisfactory negotiation, execution and delivery by all parties of appropriate definitive loan documents relating to the Facilities,  including, without limitation, credit agreements, guarantees, opinions of counsel and other related definitive documents (collectively, the “Facility Documentation”), based upon the terms set forth in this Commitment Letter (it being agreed that the Facility Documentation shall not contain any conditions precedent to the initial borrowing under the Facilities on the Closing Date other than the conditions precedent expressly set forth herein, in Annex B under the heading “Conditions Precedent to Initial Borrowing”, in Annexes C and D under the heading “Conditions Precedent to Borrowing” and in Annex E hereto, and the terms of the Facility Documentation will be such that they do not impair the availability of the Facilities on the Closing Date if such conditions are satisfied); provided that, to the extent any security interest in any Collateral (as defined in Annex B) is not or cannot be provided and/or perfected on the Closing Date (other than the pledge and perfection of the security interests in (1) the certificated equity securities of any material wholly owned U.S. subsidiary of the Borrower (to the extent required by Annexes B, C or D), (2) intellectual property pursuant to filings with the United States Patent and Trademark Office and the United States Copyright Office and (3) other assets with respect to which a lien may be perfected by the filing of a financing statement under the Uniform Commercial Code) after your use of commercially reasonable efforts to do so or without undue burden or expense, then the provision and/or perfection of a security interest in such Collateral shall not constitute a condition precedent to the availability of the Facilities on the Closing Date but instead shall be required to be delivered and/or perfected after the Closing Date pursuant to arrangements and timing to be mutually agreed (but, in any event, not later than 90 days after the Closing Date or such longer period as may be agreed by the Bank Administrative Agent) by the Bank Administrative Agent and the Borrower acting reasonably.  Each Commitment Party’s commitment is also subject to the Company having entered into an engagement letter with one or more investment banks (the “Investment Banks”) reasonably acceptable to the Commitment Parties, pursuant to which you engaged the Investment Banks in connection with a potential issuance of Notes or other financing.  This paragraph, and the provisions herein, shall be referred to as the “Funding Conditions Provision”. Without limiting the conditions precedent expressly provided herein to funding the consummation of the Stock Buy-Back with the proceeds of the Facilities, the Arrangers will cooperate with you as reasonably requested in coordinating the timing and procedures for the funding of the Facilities in a manner consistent with the Purchase Agreement.

 

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3.                                      Syndication.

 

The Arrangers intend, and reserve the right, to syndicate the Facilities to the Lenders promptly following the date hereof, and you acknowledge and agree that the commencement of syndication shall occur in the discretion of the Arrangers.  The Arrangers will select the Lenders in consultation with you and reasonably acceptable to you; provided that the Arrangers agree not to syndicate the Facilities to (i) certain banks, financial institutions, other institutional lenders and other entities that have been specified to the Arrangers by you in writing prior to the date hereof and (ii) any of the known affiliates reasonably identifiable by name of entities described in clause (i) (the entities described in clauses (i) and (ii), collectively the “Disqualified Lenders”) and that no Disqualified Lenders may become Lenders.  The Arrangers will lead the syndication, including determining the timing of all offers to potential Lenders, any title of agent or similar designations or roles awarded to any Lender and the acceptance of commitments, the amounts offered and the compensation provided to each Lender from the amounts to be paid to the Arrangers pursuant to the terms of this Commitment Letter and the Fee Letter.  The Arrangers will, in consultation with you, determine the final commitment allocations and will notify you of such determinations.

 

To facilitate an orderly and successful syndication of the Facilities, you agree that, until the earliest of (x) the termination of the syndication as determined by the Arrangers, (y) the consummation of a Successful Syndication (as defined in the Fee Letter) and (z) 60 days after the Closing Date, the Company and its subsidiaries will not syndicate or issue, attempt to syndicate or issue, announce or authorize the announcement of the syndication or issuance of, any debt facility or any debt security of the Company or any of their respective subsidiaries (other than (a) the Facilities and other indebtedness contemplated hereby to remain outstanding after the Closing Date and (b) the issuance of the Notes (if any)) without the prior written consent of the Arrangers (such consent not to be unreasonably withheld or delayed) if any such issuance or syndication would in the Arrangers’ reasonable judgment materially and adversely impair the primary syndication of the Facilities or the Notes Offering (it is understood the Company’s deferred purchase price obligations, ordinary course working capital facilities and ordinary course capital leases, letters of credit and purchase money and equipment financings, if any, will not be deemed to materially and adversely impair the primary syndication of the Facilities or the Notes Offering).

 

Notwithstanding the Arrangers’ right to syndicate the Facilities and receive commitments with respect thereto, it is agreed that (i) syndication of, or receipt of commitments or participations in respect of, all or any portion of each Initial Lender’s commitments hereunder prior to the date of the consummation of the Stock Buy-Back and the date of the initial funding under the Facilities shall not be a condition to such Initial Lender’s commitments; (ii) except as provided above with respect to appointment of Additional Agents, no Initial Lender shall be relieved, released or novated from its obligations hereunder (including its obligation to fund the Facilities on the Closing Date) in connection with any syndication, assignment or participation of the Facilities, including its commitments in respect thereof, until after the initial funding of the Facilities has occurred; (iii) except as provided above with respect to appointment of Additional Agents, no assignment or novation shall become effective with respect to all or any portion of any Initial Lender’s commitments in respect of the Facilities until after the initial funding of the Facilities; and (iv) unless you otherwise agree in writing, each Commitment Party shall retain exclusive control over all rights and obligations with respect to its commitments in respect of the Facilities, including all rights with respect to consents, modifications, supplements, waivers and amendments, until the Closing Date has occurred. Without limiting your obligations to assist with syndication efforts as set forth herein, it is understood that each Initial Lender’s commitments hereunder are not conditioned upon the syndication of, or receipt of commitments or participations in respect of, the Facilities and in no event shall the commencement or successful completion of syndication of the Facilities constitute a condition to the availability of the Facilities on the Closing Date.

 

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You agree to use your commercially reasonable efforts to cooperate with the Commitment Parties in connection with (i) the preparation of one or more customary information packages regarding the business, operations and financial projections of  the Company (collectively, the “Confidential Information Memorandum”), including, without limitation, all information relating to the transactions contemplated hereunder prepared by or on behalf of the Company deemed reasonably necessary by the Arrangers to complete the syndication of the Facilities and will use commercially reasonable efforts to obtain, prior to the launch of syndication, (a) a public corporate family rating from Moody’s Investors Service, Inc. (“Moody’s”) for the Company, (b) a public corporate credit rating from Standard & Poor’s Ratings Group, a division of The McGraw Hill Corporation (“S&P”) for the Company and (c) a public credit rating for the Facilities and any Notes issued in lieu thereof from each of Moody’s and S&P, and (ii) the presentation of one or more information packages reasonably acceptable in customary format and content to the Commitment Parties (collectively, the “Lender Presentation”) in meetings and other communications with prospective Lenders or agents in connection with the syndication of the Facilities (including, without limitation, direct contact between senior management and representatives, with appropriate seniority and expertise, of the Company with prospective Lenders and participation of such persons in meetings upon reasonable advance notice and at mutually agreed times).  You agree to use commercially reasonable efforts to ensure that syndication benefits from your existing lending and investment banking relationships.  You will be solely responsible for the contents of any such Confidential Information Memorandum and Lender Presentation (other than, in each case, any information contained therein that has been provided for inclusion therein by the Commitment Parties solely to the extent such information relates to the Commitment Parties) and all other information, documentation or materials delivered to the Arrangers in connection therewith (collectively, the “Information”) and you acknowledge that the Commitment Parties will be using and relying upon the Information without independent verification thereof.  You agree that Information regarding the Facilities and Information provided by the Company or its representatives to the Arrangers in connection with the Facilities (including, without limitation, draft and execution versions of the Facility Documentation, the Confidential Information Memorandum, the Lender Presentation, publicly filed financial statements, and draft or final offering materials relating to contemporaneous securities issuances by the Company) may be disseminated to potential Lenders and other persons through one or more internet sites (including an IntraLinks, SyndTrak or other electronic workspace (the “Platform”) created for purposes of syndicating the Facilities or otherwise, in accordance with the Arrangers’ standard syndication practices), and you acknowledge that neither the Arrangers nor any of their affiliates will be responsible or liable to you or any other person or entity for damages arising from the use by others of any Information or other materials obtained on the Platform, except, in the case of damages to you but not to any other person, to the extent such damages are found by a final judgment of a court of competent jurisdiction to arise from the gross negligence or willful misconduct of any Arranger or (i) any of their controlled affiliates, (ii) any of the respective directors or employees of such Arranger or its controlled affiliates or (iii) the respective advisors or agents of such Arranger or its controlled affiliates, in the case of this clause (iii), acting at the instructions of such Arranger or controlled affiliate. Notwithstanding anything to the contrary contained in this Commitment Letter or the Fee Letter or any other letter agreement or undertaking concerning the financing of the Stock Buy-Back to the contrary, neither the obtaining of the ratings above nor the compliance with any other provision of this paragraph shall constitute a condition to the commitments hereunder or the funding of the Facilities on the Closing Date or at any time thereafter.

 

You acknowledge that certain of the Lenders may be “public side” Lenders (i.e. Lenders that do not wish to receive material non-public information with respect to the Company or its affiliates or any of its or their respective securities) (each, a “Public Lender”).  At the request of the Arrangers, you agree to prepare an additional version of the Confidential Information Memorandum and the Lender Presentation to be used by Public Lenders that does not contain material non-public information concerning the Company or its affiliates or its securities.  It is understood that in connection with your assistance

 

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described above, at the request of the Arrangers, you will provide, and cause all other applicable persons to provide, authorization letters to the Arrangers authorizing the distribution of the Information to prospective Lenders containing a representation to the Arrangers that the public-side version does not include material non-public information about the Company or its subsidiaries or its or its securities.  In addition, you will clearly designate as such all Information provided to the Commitment Parties by or on behalf of the Company which is suitable to make available to Public Lenders.  You acknowledge and agree that the following documents may be distributed to Public Lenders, unless you advise the Arrangers in writing (including by email) within a reasonable time prior to their intended distributions (provided that such materials have been provided to you for review a reasonable time prior thereto) that such material should only be distributed to prospective Lenders that are not Public Lenders:  (a) drafts and final versions of the Facility Documentation; (b) administrative materials prepared by the Arrangers for prospective Lenders (such as a lender meeting invitation, allocations and funding and closing memoranda); and (c) term sheets and notification of changes in the terms of the Facilities.

 

4.                                      Information.

 

You represent and covenant that (i) all written Information (other than financial projections and information of a general economic or industry specific nature) provided directly or indirectly by the Company to the Commitment Parties or the Lenders in connection with the transactions contemplated hereunder is and will be, when furnished and when taken as a whole and giving effect to all supplements and updates thereto, complete and correct in all material respects and does not and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein, in light of the circumstances under which they were made, not materially misleading and (ii) the financial projections that have been or will be made available to the Commitment Parties or the Lenders in connection with the transactions contemplated hereunder by or on behalf of the Company have been and will be prepared in good faith based upon assumptions that are believed by the preparer thereof to be reasonable at the time such financial projections are furnished to the Commitment Parties or the Lenders, it being understood and agreed that financial projections are not a guarantee of financial performance and actual results may differ from financial projections and such differences may be material.  You agree that if at any time prior to the Successful Syndication of the Facilities, you become aware that any of the representations in the preceding sentence would be incorrect in any material respect if the Information and financial projections were being furnished, and such representations were being made, at such time, then you will promptly supplement, or cause to be supplemented, the Information and financial projections so that such representations will be correct in all material respects under those circumstances.

 

5.                                      Indemnification and Related Matters.

 

In connection with arrangements such as this, it is the Commitment Parties’ policy to receive indemnification.  You agree to the provisions with respect to our indemnity and other matters set forth in Annex A, which is incorporated by reference into this Commitment Letter.

 

6.                                      Assignments; Amendments.

 

This Commitment Letter may not be assigned by you without the prior written consent of the Commitment Parties (and any purported assignment without such consent will be null and void), is intended to be solely for the benefit of the Commitment Parties and the other parties hereto and, except as set forth in Annex A hereto, is not intended to confer any benefits upon, or create any rights in favor of, any person other than the parties hereto.  Each of the Commitment Parties, after consultation with you, may assign its commitments and agreements hereunder, in whole or in part, to any of its affiliates

 

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(provided that such affiliates agree to abide by the confidentiality provisions of Section 7 of this Commitment Letter) and, as provided above, to any Lender prior to the Closing Date. Neither this Commitment Letter nor the Fee Letter may be amended or any term or provision hereof or thereof waived or otherwise modified except by an instrument in writing signed by each of the parties hereto or thereto, as applicable, and any term or provision hereof or thereof may be amended or waived only by a written agreement executed and delivered by all parties hereto or thereto.

 

7.                                      Confidentiality.

 

Please note that this Commitment Letter, the Fee Letter and any written communications provided by, or oral discussions with, the Commitment Parties in connection with this arrangement are exclusively for the information of the Company and may not be disclosed to any third party or circulated or referred to publicly without our prior written consent except, after providing written notice to the Commitment Parties (to the extent not prohibited by applicable law), pursuant to applicable law, rule, regulation or a subpoena or order issued by a court of competent jurisdiction or by a judicial, administrative or legislative body or committee; provided that we hereby consent to your disclosure of (i) this Commitment Letter, the Fee Letter (on a redacted basis reasonably satisfactory to the Arrangers) and such communications and discussions to the Company’s, ASAC’s and Vivendi’s respective directors, employees, agents, accountants, legal counsel and other advisors, and ASAC’s investors, in each case who are directly involved in the consideration of the Facilities or the Stock Buy-Back and who have been informed by you of the confidential nature of such advice and the Commitment Letter and Fee Letter and who have agreed to treat such information confidentially, (ii) this Commitment Letter, the Fee Letter and such communications and discussions as required by applicable law, rule or regulation or compulsory legal process (in which case you agree to inform us promptly thereof to the extent not prohibited by law), (iii) the information contained in Annexes B, C and D to Moody’s and S&P, (iv) this Commitment Letter (but not the Fee Letter) to the extent that information contained herein becomes publicly available other than by reason of improper disclosure by you in violation of any confidentiality obligations hereunder and (v) after your acceptance hereof, this Commitment Letter in filings with the SEC and other applicable regulatory authorities and stock exchanges; provided that, in the cases of clauses (i) through (iii), such information is supplied only on a confidential basis.

 

Each Commitment Party agrees that it will treat as confidential all confidential information provided to it hereunder by or on behalf of you or any of your subsidiaries or affiliates; provided that nothing herein will prevent any Commitment Party from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending legal or administrative proceeding, or otherwise as required by applicable law or compulsory legal process (in which case such person agrees (except with respect to any routine or ordinary course audit or examination conducted by bank accountants or any governmental bank regulatory authority exercising examination or regulatory authority) to inform you promptly thereof to the extent not prohibited by law), (b) upon the request or demand of any regulatory authority having jurisdiction over such person or any of its affiliates, (c) to the extent that such information is publicly available or becomes publicly available other than in violation of this paragraph, (d) to such person’s affiliates and such person’s and its affiliates’ respective officers, directors, partners, employees, legal counsel, independent auditors and other experts or agents who need to know such information and on a confidential basis, (e) to potential and prospective Lenders, participants and any direct or indirect contractual counterparties to any swap or derivative transaction relating to the Borrower and its obligations under the Facilities, in each case, who agree to be bound by similar confidentiality provisions (including, for the avoidance of doubt, by means of a customary click-through or otherwise) (and, in each case, other than to a Disqualified Lender), (f) to Moody’s and S&P; provided that such information is limited to Annexes B, C, D and E and is supplied only on a confidential basis after consultation with you, (g) for purposes of enforcing its rights hereunder and under the Fee Letter and

 

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establishing a “due diligence” defense, (h) to the extent that such information is received by a Commitment Party from a third party that is not to such Commitment Party’s knowledge subject to confidentiality obligations or (i) to the extent that such information is independently developed by the Commitment Parties.  Each Commitment Party’s obligation under this provision shall remain in effect until the earlier of (i) two years from the date hereof and (ii) the date the definitive Facility Documentation is entered into by the Commitment Parties, at which time any confidentiality undertaking in the definitive Facility Documentation shall supersede this provision.

 

8.                                      Absence of Fiduciary Relationship; Affiliates; Etc.

 

As you know, each Commitment Party, together with its respective affiliates (each collectively, a “Commitment Party Group”), is a full service financial services firm engaged, either directly or through affiliates, in various activities, including securities trading, investment banking and financial advisory, investment management, principal investment, hedging, financing and brokerage activities and financial planning and benefits counseling for both companies and individuals.  In the ordinary course of these activities, each Commitment Party Group may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and/or financial instruments (including bank loans) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and/or instruments.  Such investment and other activities may involve securities and instruments of you, as well as of other entities and persons and their affiliates which may (i) be involved in transactions arising from or relating to the engagement contemplated by this Commitment Letter, (ii) be customers or competitors of you, or (iii) have other relationships with you.  In addition, each Commitment Party Group may provide investment banking, underwriting and financial advisory services to such other entities and persons.  Each Commitment Party Group may also co-invest with, make direct investments in, and invest or co-invest client monies in or with funds or other investment vehicles managed by other parties, and such funds or other investment vehicles may trade or make investments in your securities or those of such other entities.  The transactions contemplated by this Commitment Letter may have a direct or indirect impact on the investments, securities or instruments referred to in this paragraph.  Although each Commitment Party Group in the course of such other activities and relationships may acquire information about the transaction contemplated by this Commitment Letter or other entities and persons which may be the subject of the transactions contemplated by this Commitment Letter, no Commitment Party Group shall have any obligation to disclose such information, or the fact that such Commitment Party Group is in possession of such information, to you or to use such information on the Company’s behalf.

 

Consistent with their respective policies to hold in confidence the affairs of its customers, no Commitment Party Group will furnish confidential information obtained from you by virtue of the transactions contemplated by this Commitment Letter to any other companies, or use such information in connection with the performance by such Commitment Party Group of services for any other companies.  Furthermore, you acknowledge that no Commitment Party Group and none of their respective affiliates has an obligation to use in connection with the transactions contemplated by this Commitment Letter, or to furnish to you, confidential information obtained or that may be obtained by them from any other person.

 

Each Commitment Party Group may have economic interests that conflict with yours, or those of your equity holders and/or affiliates.  You agree that each Commitment Party Group will act under this Commitment Letter as an independent contractor and that nothing in this Commitment Letter or the Fee Letter or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between any Commitment Party Group and you or your equity holders or affiliates.  You acknowledge and agree that the transactions contemplated by this Commitment Letter and the Fee

 

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Letter (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between the Commitment Party Groups, on the one hand, and you on the other, and in connection therewith and with the process leading thereto, (i) no Commitment Party Group has assumed (A) an advisory or fiduciary responsibility in favor of you or your equity holders or affiliates with respect to the financing transactions contemplated hereby, or in each case, the exercise of rights or remedies with respect thereto or the process leading thereto (irrespective of whether such Commitment Party has advised, is currently advising or will advise you, your equity holders or your affiliates on other matters) or any other obligation to you except the obligations expressly set forth in this Commitment Letter and the Fee Letter and (ii) each Commitment Party Group is acting solely as a principal and not as the agent or fiduciary of you, your management, equity holders, affiliates, creditors or any other person.  You acknowledge and agree that you have consulted your own legal and financial advisors to the extent you deemed appropriate and that you are responsible for making your own independent judgment with respect to such transactions and the process leading thereto.  You agree that you will not claim that any Commitment Party Group has rendered advisory services of any nature or respect, or owes you a fiduciary or similar duty, in connection with such transactions or the process leading thereto.

 

In addition, each Commitment Party may employ the services of its affiliates in providing services and/or performing their obligations hereunder and may exchange with such affiliates information concerning you and other companies that may be the subject of this arrangement, and such affiliates will be entitled to the benefits afforded to the Commitment Parties hereunder.

 

In addition, please note that the Commitment Parties do not provide accounting, tax or legal advice.  Notwithstanding anything herein to the contrary, you (and each of your employees, representatives and other agents) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the Facilities and all materials of any kind (including opinions or other tax analyses) that are provided to you relating to such tax treatment and tax structure.  However, any information relating to the tax treatment or tax structure will remain subject to the confidentiality provisions hereof (and the foregoing sentence will not apply) to the extent reasonably necessary to enable the parties hereto, their respective affiliates, and their respective affiliates’ directors and employees to comply with applicable securities laws.  For this purpose, “tax treatment” means U.S. federal, state or local income tax treatment, and “tax structure” is limited to any facts relevant to the U.S. federal income tax treatment of the transactions contemplated by this Commitment Letter but does not include information relating to the identity of the parties hereto or any of their respective affiliates.

 

9.                                      Miscellaneous.

 

Each Commitment Party’s commitments and agreements hereunder will terminate upon the first to occur of (i) the consummation of the Stock Buy-Back, (ii) the abandonment or termination of the Purchase Agreement by you and (iii) October 18, 2013.  Subject to the last sentence of this paragraph and the terms of the Fee Letter, you may terminate this Commitment Letter and/or each Commitment Party’s commitments hereunder.  In addition, each Commitment Party’s commitments hereunder to provide and arrange the Bridge Loans will be reduced to the extent described herein by any issuance of Secured Notes and/or Unsecured Notes. The provisions set forth under Sections 3, 4, 5 (including Annex A), 7 and 8 hereof and this Section 9 hereof will remain in full force and effect regardless of whether the definitive Facility Documentation is executed and delivered.  The provisions set forth under Sections 5 (including Annex A), 7 and 8 hereof, and the fee and expense reimbursement provisions of the Fee Letter will remain in full force and effect notwithstanding the expiration or termination of this Commitment Letter or the Commitment Parties’ commitments and agreements hereunder; provided that such provisions relating to indemnification and reimbursement shall terminate and be superseded by the terms of the Facility

 

10












 

Documentation to the extent covered thereby and to the extent such Facility Documentation becomes effective.

 

Each party hereto agrees for itself and its affiliates that any suit or proceeding arising in respect to this Commitment Letter or the Commitment Parties’ commitments or agreements hereunder or the Fee Letter will be tried exclusively in the U.S. District Court for the Southern District of New York or, if that court does not have subject matter jurisdiction, in any state or federal court located in the Borough of Manhattan in the City of New York, and each party hereto agrees to submit to the exclusive jurisdiction of, and to venue in, such court.  ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING IN CONNECTION WITH OR AS A RESULT OF EITHER THE COMMITMENT PARTIES’ COMMITMENTS OR AGREEMENTS OR ANY MATTER REFERRED TO IN THIS COMMITMENT LETTER OR THE FEE LETTER IS HEREBY WAIVED BY THE PARTIES HERETO.  THIS COMMITMENT LETTER AND THE FEE LETTER WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS THAT WOULD RESULT IN THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION); PROVIDED THAT MATTERS RELATED TO THE PURCHASE AGREEMENT SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF TO THE EXTENT THAT SUCH PRINCIPLES WOULD DIRECT A MATTER TO ANOTHER JURISDICTION.

 

The Commitment Parties hereby notify you that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot Act”) the Commitment Parties and each Lender may be required to obtain, verify and record information that identifies the Borrower and each of the Guarantors, which information includes the name and address of the Borrower and each of the Guarantors and other information that will allow the Commitment Parties and each Lender to identify the Borrower and each of the Guarantors in accordance with the Patriot Act.  This notice is given in accordance with the requirements of the Patriot Act and is effective for the Commitment Parties and each Lender.

 

This Commitment Letter may be executed in any number of counterparts, each of which when executed will be an original, and all of which, when taken together, will constitute one agreement.  Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission or electronic transmission (in “pdf” or “tif” format) will be effective as delivery of a manually executed counterpart hereof.  This Commitment Letter and the Fee Letter are the only agreements that have been entered into among the parties hereto with respect to the Facilities and set forth the entire understanding of the parties with respect thereto and supersede any prior written or oral agreements among the parties hereto with respect to the Facilities.

 

[Remainder of page intentionally left blank]

 

11











 

Please confirm that the foregoing is in accordance with your understanding by signing and returning to the Commitment Parties the enclosed copy of this Commitment Letter, together, if not previously executed and delivered, with the Fee Letter on or before the close of business on July 25, 2013, whereupon this Commitment Letter and the Fee Letter will become binding agreements between us.  If the Commitment Letter and Fee Letter have not been signed and returned as described in the preceding sentence by such date, this offer will terminate on such date.  We look forward to working with you on this transaction.

 

	
 
    	
Very   truly yours,
    
	
 
    	
 
    
	
 
    	
BANK   OF AMERICA, N.A.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Daniel J. Kelly
    
	
 
    	
 
    	
Name:   Daniel J. Kelly
    
	
 
    	
 
    	
Title:   Managing Director
    


 

	
 
    	
MERRILL   LYNCH, PIERCE, FENNER & SMITH INCORPORATED
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Daniel J. Kelly
    
	
 
    	
 
    	
Name:   Daniel J. Kelly
    
	
 
    	
 
    	
Title:   Managing Director
    


 











 

	
 
    	
JPMORGAN   CHASE BANK, N.A.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Gerardo B. Loera
    
	
 
    	
 
    	
Name:   Gerardo B. Loera
    
	
 
    	
 
    	
Title:   Vice President
    


 

	
 
    	
J.P.   MORGAN SECURITIES LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Varun Rastogi
    
	
 
    	
 
    	
Name:   Varun Rastogi
    
	
 
    	
 
    	
Title:   Vice President
    


 











 

ACCEPTED AND AGREED AS OF THE DATE FIRST WRITTEN ABOVE:

 

ACTIVISION BLIZZARD, INC.

 

 

	
By:
    	
/s/   Chris B. Walther
    	
 
    
	
 
    	
Name:   Chris B. Walther
    	
 
    
	
 
    	
Title:   Chief Legal Officer
    	
 
    


 











 

Annex A

 

In the event that any Commitment Party becomes involved in any capacity in any action, proceeding or investigation brought by or against any person, including shareholders, partners, members or other equity holders of the Company in connection with or as a result of either this arrangement or any matter referred to in this Commitment Letter or the Fee Letter (together, the “Letters”), the Company agrees to reimburse each Commitment Party for its reasonable and documented out-of-pocket legal and other expenses (including the cost of any investigation and preparation) incurred in connection therewith.  The Company also agrees to indemnify and hold each Commitment Party harmless against any and all losses, claims, damages or liabilities to any such person in connection with or as a result of the transactions contemplated by this Commitment Letter (whether or not such investigation, litigation, claim or proceeding is brought by you, your equity holders or creditors or an indemnified party and whether or not any such indemnified party is otherwise a party thereto), except to the extent that such loss, claim, damage or liability (x) has been found by a final, non-appealable judgment of a court of competent jurisdiction to have resulted from (i) the gross negligence or willful misconduct of such Commitment Party in performing the services that are subject of the Letters or (ii) a material breach of the obligations of such Commitment Party under the Letters or (y) has resulted from any dispute solely among the Commitment Parties other than claims against any Commitment Party in its capacity or fulfilling its role as an agent or arranger or any similar role under the Letters or the Facilities and other than any claims arising out of any act or omission on the part of the Company or its affiliates, provided, however, that notwithstanding anything to the contrary provided herein, in no event shall (x) the Company have any liability for any indirect, consequential, special or punitive damages in connection with or as a result of the Company’s activities related to the Letters (other than in respect of any such damages required to be indemnified under this Annex A) and (y) the Company have any obligations to reimburse or indemnify any indemnified party for its out-of-pocket legal expenses other than the reasonable, documented fees, charges and disbursements of a single counsel for all indemnified parties, selected by the Commitment Parties, and of such special counsel and local counsel as the Commitment Parties may deem appropriate in their good faith discretion, except that if any indemnified party reasonably concludes that its interests conflict with those of another indemnified party and notifies the Company of such conflict, the Company shall be responsible for the reasonable documented fees, charges and disbursements of one separate counsel (and special and local counsel) for all such conflicted indemnified parties.  If for any reason the foregoing indemnification is unavailable to any Commitment Party or insufficient to hold it harmless, then the Company will contribute to the amount paid or payable by the Commitment Party as a result of such loss, claim, damage or liability (a) in such proportion as is appropriate to reflect the relative benefits of (i) the Company and its affiliates, shareholders, partners, members or other equity holders on the one hand and (ii) such Commitment Party on the other hand in the matters contemplated by the Letters or (b) if the allocation provided by clause (a) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (a) above but also the relative fault of (i) the Company and its affiliates, shareholders, partners, members or other equity holders and (ii) such Commitment Party with respect to such loss, claim, damage or liability, and any other relevant equitable considerations.  The reimbursement, indemnity and contribution obligations of  the Company under this paragraph will be in addition to any liability which  the Company may otherwise have, will extend upon the same terms and conditions to any affiliate of a Commitment Party and the partners, members, directors, agents, employees and controlling persons (if any), as the case may be, of such Commitment Party and any such affiliate (collectively with the Commitment Parties, an “indemnified party”), and will be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of  the Company, each Commitment Party, any such affiliate and any such person.  The Company also agrees that neither any indemnified party nor any of such affiliates, partners, members, directors, agents, employees or controlling persons will have any liability based on its or their exclusive or contributory negligence or otherwise to the Company or any person asserting claims on

 

Annex A - 1











 

behalf of or in right of the Company or any other person in connection with or as a result of either this arrangement or any matter referred to in the Letters, except to the extent that any losses, claims, damages, liabilities or expenses incurred by the Company or their respective affiliates, shareholders, partners or other equity holders have been found by a final, non-appealable judgment of a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of such indemnified party in performing the services that are the subject of the Letters; provided, however, that in no event will such indemnified party or such other parties have any liability for any indirect, consequential, special or punitive damages in connection with or as a result of such indemnified party’s or such other parties’ activities related to the Letters.

 

The Company will not be required to indemnify any Commitment Party for any amount paid or payable by such Commitment Party in the settlement of any action, proceeding or investigation without the Company’s consent, which consent will not be unreasonably withheld or delayed; provided, that the foregoing indemnity will apply to any such settlement in the event that  the Company was offered the ability to assume the defense of the action that was the subject matter of such settlement and elected not to so assume. The provisions of this Annex A will survive any termination or completion of the arrangement provided by the Letters.

 

Annex A - 2











 

Annex B

 

Summary of the Senior Secured Facilities

 

This Summary outlines certain terms of the Senior Secured Facilities referred to in the Commitment Letter, of which this Annex B is a part.  Certain capitalized terms used herein are defined in the Commitment Letter.

 

	
Borrower:
    	
 
    	
Activision Blizzard, Inc. (the “Borrower”).
    
	
 
    	
 
    	
 
    
	
Joint   Lead Arrangers and Joint Bookrunners:
    	
 
    	
Merrill Lynch, Pierce, Fenner &   Smith Incorporated (or any of its designated affiliates) (“Merrill Lynch”) and J.P. Morgan Securities LLC (“J.P. Morgan”), in each case in its capacity as Joint Lead   Arranger and Joint Bookrunner (together with any Additional Arrangers   appointed in accordance with Section 1 of the Commitment Letter,   collectively, the “Bank Lead Arrangers”   or, the “Arrangers”).
    
	
 
    	
 
    	
 
    
	
Syndication Agent:
    	
 
    	
J.P. Morgan Securities LLC, in its capacity   as Syndication Agent (the “Syndication Agent”).
    
	
 
    	
 
    	
 
    
	
Bank Administrative Agent:
    	
 
    	
Bank of America, N.A. (“Bank of   America”), in its capacity as sole and exclusive administrative   agent and collateral agent (the “Bank Administrative   Agent”).
    
	
 
    	
 
    	
 
    
	
Lenders:
    	
 
    	
Bank of America, JPMorgan Chase Bank, N.A.   (“JPMCB”) and/or other financial   institutions selected by the Bank Lead Arrangers in consultation with and   reasonably acceptable to the Borrower (each, a “Bank   Lender” and, collectively, the “Bank   Lenders”).
    
	
 
    	
 
    	
 
    
	
Senior Secured Facilities:
    	
 
    	
(A) A senior secured term loan facility   in an aggregate principal amount of up to $2,250 million (the “Term B Facility”; the loans thereunder, the “Term B Loans”; the Bank Lenders thereunder, the “Term B Lenders”).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(B) A senior secured revolving credit   facility in an aggregate principal amount of $250 million (the “Revolving Facility”; the commitments thereunder, the “Revolving Commitments”; the loans thereunder, the “Revolving Loans”; the Bank Lenders thereunder, the “Revolving Lenders”), of which up to an amount to be agreed   shall be available in the form of Letters of Credit (as defined below).
    
	
 
    	
 
    	
 
    
	
Swingline:
    	
 
    	
In connection with the Revolving Facility,   Bank of America (in such capacity, the “Swingline Lender”)   will make available to the Borrower a swingline facility under which the   Borrower may make short-term borrowings (on same-day notice (in minimum   amounts to be mutually agreed upon and integral multiples to be agreed upon))   of up to an amount to be agreed. Except for
    


 

Annex B - 1











 

	
 
    	
purposes of calculating the commitment fee   described on Exhibit I to this Annex B, any such swingline borrowings   will reduce availability under the Revolving Facility on a dollar-for-dollar   basis.
    
	
 
    	
 
    
	
 
    	
Upon notice from the Swingline Lender, the   Bank Lenders will be unconditionally obligated to purchase participations in   any swingline loan pro rata based upon their Revolving Commitments.
    
	
 
    	
 
    
	
 
    	
If   any Revolving Lender becomes a Defaulting Bank Lender (to be defined based on   the below and as otherwise mutually reasonably agreed) then the swingline   exposure of such Defaulting Bank Lender will automatically be reallocated   among the non-Defaulting Bank Lenders pro rata in accordance with their   Revolving Commitments up to an amount such that the revolving credit exposure   of such non-Defaulting Bank Lender does not exceed its Revolving Commitments.   In the event such reallocation does not fully cover the exposure of such Defaulting   Bank Lender, the Swingline Lender may require the Borrower to repay such   “uncovered” exposure in respect of the swingline loans and will have no   obligation to make new swingline loans to the extent such swingline loans   would exceed the commitments of the non-Defaulting Bank Lenders.
    
	
 
    	
 
    
	
 
    	
“Defaulting Bank Lender” means any Bank Lender whose acts   or failure to act, whether directly or indirectly, cause it to meet any part   of the definition of “Lender Default”.
    
	
 
    	
 
    
	
 
    	
“Lender Default” means (i) the refusal or failure of   any Bank Lender to make available its portion of any incurrence of Revolving   Loans or participations in letters of credit or swingline borrowings, which   refusal or failure is not cured within one business day after the date of   such refusal or failure; (ii) the failure of any Bank Lender to pay over   to the Bank Administrative Agent, any Issuing Lender (as defined below), any   Swingline Lender or any other Bank Lender any other amount required to be   paid by it hereunder within one business day of the date when due, unless the   subject of a good faith dispute; (iii) a Bank Lender has notified the   Borrower or the Bank Administrative Agent that it does not intend or expect   to comply with any of its funding obligations or has made a public statement   to that effect with respect to its funding obligations under the Senior   Secured Facilities; (iv) the failure by a Bank Lender to confirm in a   manner reasonably satisfactory to the Bank Administrative Agent that it will   comply with its obligations under the Senior Secured Facilities or (v) a   Distressed Person (as defined below) that has admitted in writing that it is   insolvent or such Distressed Person becomes subject to a Lender-Related   Distress Event.
    


 

Annex B - 2











 

	
 
    	
 
    	
“Lender-Related Distress Event” means, with respect to any   Bank Lender, that such Bank Lender or any person that directly or indirectly   controls such Bank Lender (each, a “Distressed Person”),   as the case may be, is or becomes subject to a voluntary or involuntary case   with respect to such Distressed Person under any debt relief law, or a   custodian, conservator, receiver or similar official is appointed for such   Distressed Person or any substantial part of such Distressed Person’s assets,   or such Distressed Person or any person that directly or indirectly controls   such Distressed Person is subject to a forced liquidation, or such Distressed   Person makes a general assignment for the benefit of creditors or is   otherwise adjudicated as, or determined by any governmental authority having   regulatory authority over such Distressed Person or its assets to be,   insolvent or bankrupt; provided that a Lender-Related Distress Event   shall not be deemed to have occurred solely by virtue of (i) the   ownership or acquisition of any equity interests in any Bank Lender or any   person that directly or indirectly controls such Bank Lender by a   governmental authority or an instrumentality thereof or (ii) an   undisclosed administration pursuant to the laws of the Netherlands.
    
	
 
    	
 
    	
 
    
	
Incremental Facilities:
    	
 
    	
The Senior Secured Facilities will permit   the Borrower to add one or more incremental term loan facilities to the   Senior Secured Facilities (each, an “Incremental Term   Facility”), and/or increase commitments under the Revolving   Facility Commitments (any such increase, an “Incremental   Revolving Increase”) and/or add one or more incremental revolving   credit facility tranches (each, an “Incremental Revolving   Facility”; the Incremental Term Facilities, the Incremental   Revolving Increases and the Incremental Revolving Facilities are collectively   referred to as “Incremental Facilities”)   in an aggregate principal amount of up to (a) $750 million plus   (b) all voluntary prepayments and voluntary commitment reductions of the   Senior Secured Facilities prior to the date of any such incurrence plus   (c) an additional amount if, after giving effect to the incurrence of   such additional amount, the Senior Secured Net Leverage (as defined below) is   equal to or less than 2.25:1.00 (assuming all such additional amounts were   secured on a first lien basis, whether or not so secured, and including for   this purpose the full amount of any Incremental Revolving Increase or   Incremental Revolving Facility (whether or not borrowed)); provided   that (i) no existing Bank Lender will be required to participate in any   such Incremental Facilities, (ii) no event of default exists, or would   exist after, giving effect thereto (except in connection with permitted   acquisitions or investments, where no payment or bankruptcy event of default   will be the standard), (iii) the final maturity date and the weighted   average maturity of any such Incremental Term Facility shall not be earlier   than, or shorter than, as the case may be, the maturity date or the
    


 

Annex B - 3











 

	
 
    	
weighted average life, as applicable, of the   Term B Facility, (iv) the pricing, interest rate margins, discounts,   premiums, rate floors, fees and amortization schedule applicable to any   Incremental Term Facility shall be determined by the Borrower and the lenders   thereunder (subject to clause (vii) below); (v) any Incremental   Revolving Facility or Incremental Revolving Increase shall be on the same   terms and pursuant to the same documentation applicable to the Revolving   Facility (including the maturity date in respect thereof (provided the   applicable margin applicable thereto may be increased if necessary to be   consistent with that for the Incremental Revolving Facility)); (vi) any   Incremental Term Facility shall be on terms and pursuant to documentation to   be determined by the Borrower, provided that, to the extent such terms   and documentation are not consistent with, in the case of an Incremental Term   B Facility, the Term B Facility (except to the extent permitted by clause   (iii) or (iv) above), they shall be reasonably satisfactory to the   Bank Administrative Agent (it being understood to the extent that any   financial maintenance covenant is added for the benefit of any Incremental   Facility, no consent shall be required from the Administrative Agent or any   Lender to the extent that such financial maintenance covenant is also added   for the benefit of any corresponding existing Facility); and (vii) for   the first 18 months following the Closing Date, the All-In Yield (as defined   below) applicable to any Incremental Term Facility will be determined by the   Borrower and the lenders providing such Incremental Term Facility, but will   not be more than 0.50% higher than the corresponding All-In Yield for the   existing Term B Facility unless the interest rate margin with respect to the   existing Term B Facility is increased by an amount equal to the difference   between the All-In Yield with respect to the Incremental Term Facility and   the corresponding All-In Yield on the existing Term B Facility minus 0.50%,   and after the first 18 months following the Closing Date, the All-In Yield   applicable to any Incremental Term Facility will be determined by the   Borrower and the lenders providing such Incremental Term Facility.
    
	
 
    	
 
    
	
 
    	
As used herein, (x) the “Senior Secured Net Leverage” means the ratio of   consolidated secured net debt for borrowed money, including capital leases   and purchase money obligations (calculated net of unrestricted cash and cash   equivalents other than the proceeds of Incremental Facilities to be drawn at   such time and provided that cash and cash equivalents held by foreign   subsidiaries will only be credited 50%, with aggregate netted cash subject to   a cap of $1.0 billion in the aggregate) to trailing four-quarter EBITDA (as   defined below) and (y) “All-In Yield”   means, as to any indebtedness, the yield thereof, whether in the form of   interest rate, margin, original issue discount, upfront fees, an Adjusted   LIBOR or ABR floor (solely to the extent
    


 

Annex B - 4












 

	
 
    	
 
    	
greater than 0.75% or 1.75%, respectively),   or otherwise, in each case, incurred or payable by the Borrower generally to   all the lenders of such indebtedness; provided that OID and upfront   fees shall be equated to interest rate assuming a 4-year life to maturity   (or, if less, the stated life to maturity at the time of its incurrence of   the applicable Indebtedness); and provided further that “All-In Yield”   shall not include arrangement fees, structuring fees, commitment fees,   underwriting fees and similar fees (regardless of whether paid in whole or in   part to one or more, but not all, lenders) or other fees not paid generally   to all lenders of such indebtedness.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Senior Secured Facilities will permit   the Borrower to utilize availability under the Incremental Facilities amount   to issue first lien notes or junior lien secured indebtedness (in each case,   subject to customary intercreditor terms to be mutually agreed and set forth   in an exhibit to the definitive documentation for the Senior Secured Facilities)   or unsecured indebtedness, with the amount of such secured or unsecured   indebtedness reducing the aggregate principal amount available for the   Incremental Facilities; provided that such secured or unsecured   indebtedness (i) does not mature on or prior to the maturity date of, or   have a shorter weighted average life than, loans under the Term B Facility,   (ii) has covenants no more restrictive (taken as a whole) than those   under the Term B Facility as determined in good faith by the Borrower (it being   understood to the extent that any financial maintenance covenant is added for   the benefit of any such debt, no consent shall be required from the Bank   Administrative Agent or any Lender to the extent that such financial   maintenance covenant is also added for the benefit of any corresponding   existing Facility), (iii) there shall be no borrower or guarantor in   respect of any such indebtedness that is not the Borrower or a Guarantor and   (iv) if secured, such indebtedness shall not be secured by any assets that   do not constitute collateral for the Term B Facility.
    
	
 
    	
 
    	
 
    
	
Use of Proceeds:
    	
 
    	
(A) The proceeds of borrowings under   the Term B Facility will be used by the Borrower, on the date of the initial   borrowing under the Senior Secured Facilities (the “Closing Date”),   together with the proceeds of the issuance of the Notes and/or borrowings of   the Bridge Loans and cash on hand of the Borrower, to fund the Stock Buy-Back   and pay fees and expenses associated therewith.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(B) The Letters of Credit and proceeds   of Revolving Loans will be used by the Borrower and its subsidiaries for   working capital and for other general corporate purposes (including to   finance the transactions related to the Stock Buy-Back).
    


 

Annex B - 5











 

	
Availability:
    	
 
    	
(A) The Term B Facility will be   available in a single drawing on the Closing Date. Amounts borrowed under the   Term B Facility that are repaid or prepaid may not be reborrowed.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(B) Up to an amount to be agreed in   Revolving Loans (exclusive of Letter of Credit usage) may be made available   on the Closing Date to finance the transactions related to the Stock Buy-Back   and fund any OID or upfront fees required to be funded on the Closing Date.   Additionally, Letters of Credit may be issued on the Closing Date in order to   backstop or replace letters of credit outstanding on the Closing Date.   Otherwise, Revolving Loans will be available at any time prior to the final   maturity of the Revolving Facility, in minimum principal amounts to be agreed   upon. Amounts repaid under the Revolving Facility may be reborrowed.
    
	
 
    	
 
    	
 
    
	
Interest Rates and Fees:
    	
 
    	
As set forth on Exhibit I to this Annex   B.
    
	
 
    	
 
    	
 
    
	
Default Rate:
    	
 
    	
With respect to overdue principal, the   applicable interest rate plus 2.00% per annum, and with respect to any other   overdue amount, including overdue interest, the interest rate applicable to   ABR loans (as described in Exhibit I) plus 2.00% per annum.
    
	
 
    	
 
    	
 
    
	
Letters of Credit:
    	
 
    	
No less than an amount to be agreed of the   Revolving Facility will be available to the Borrower for the purpose of   issuing letters of credit (the “Letters of Credit”).   Letters of Credit will be issued by Bank of America and other Revolving   Lenders reasonably acceptable to the Borrower and the Bank Administrative Agent   (each, an “Issuing Lender”). Each Letter of   Credit shall expire not later than the earlier of (a) 12 months after   its date of issuance or such longer period of time as may be agreed by the   applicable Issuing Lender and (b) the fifth business day prior to the   final maturity of the Revolving Facility except to the extent cash   collateralized or backstopped pursuant to arrangements reasonably acceptable   to the relevant Issuing Lender, provided that no Bank Lender shall be   required to fund participations in Letters of Credit after the maturity date   applicable to its commitments; provided that any Letter of Credit may   provide for automatic renewal thereof for additional periods of up to 12   months or such longer period of time as may be agreed by the applicable Issuing   Lender (which in no event shall extend beyond the date referred to in clause   (b) above, except to the extent cash collateralized or backstopped   pursuant to arrangements reasonably acceptable to the relevant Issuing   Lender, provided that no Bank Lender shall be required to fund   participations in Letters of Credit after the maturity date applicable to its   commitments). Drawings under any Letter of Credit shall be reimbursed by the   Borrower (whether with its own funds or with the proceeds of borrowings under   the Revolving Facility) within one business day after notice of such
    


 

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drawing is received by the Borrower from the   relevant Issuing Lender. To the extent that the Borrower does not reimburse   the Issuing Lender within the time period specified above, the Revolving   Lenders shall be irrevocably obligated to reimburse the Issuing Lender pro   rata based upon their respective Revolving Facility commitments. If any   Revolving Lender becomes a Defaulting Bank Lender, then the Letter of Credit   exposure of such Defaulting Bank Lender will automatically be reallocated   among the non-Defaulting Bank Lenders pro rata in accordance with their   Revolving Commitments up to an amount such that the revolving credit exposure   of any non-Defaulting Bank Lender does not exceed its Revolving Commitment.   In the event that such reallocation does not fully cover the Letter of Credit   exposure of such Defaulting Bank Lender, the applicable Issuing Lender may   require the Borrower to cash collateralize such “uncovered” exposure in   respect of each outstanding Letter of Credit and will have no obligation to   issue new Letters of Credit, or to extend, renew or amend existing Letters of   Credit to the extent Letter of Credit exposure would exceed the Revolving   Commitments of the non-Defaulting Bank Lenders, unless such “uncovered”   exposure is cash collateralized to the Issuing Lender’s reasonable   satisfaction.
    
	
 
    	
 
    	
 
    
	
Final Maturity and Amortization:
    	
 
    	
(A) The Term B Facility:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Term B Facility will mature on the date   that is seven years after the Closing Date and, commencing at least one full   fiscal quarter after the Closing Date, will amortize in equal quarterly   installments in aggregate annual amounts equal to 1.00% of the original   principal amount of the Term B Facility with the balance payable on the   seventh anniversary of the Closing Date; provided that the Senior   Secured Facilities Documentation shall provide the right of individual Term B   Lenders to agree to extend the maturity of their Term B Loans upon the   request of the Borrower and without the consent of any other Bank Lender (as   further described below).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(B) Revolving Facility:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Revolving Facility will mature, and   Revolving Commitments will terminate, on the date that is five years after   the Closing Date; provided that the Senior Secured Facilities   Documentation shall provide the right of individual Revolving Lenders to   agree to extend the maturity of their Revolving Commitments and Revolving   Loans upon the request of the Borrower and without the consent of any other   Bank Lender (as further described below).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Senior Secured Facilities Documentation   shall contain customary “amend and extend” provisions pursuant to which any
    


 

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individual Bank Lender may agree to extend   (which may include, among other things, an increase in the interest rates   payable with respect to such extended loans, which such extensions shall not   be subject to any “default stopper”, financial tests or “most favored nation   pricing provisions”) the maturity date of its outstanding commitments in   respect of the Revolving Facility or under any Incremental Revolving Facility   or in respect of any class of Term B Loans (including any Incremental Term B   Loans), in each case, upon the request of the Borrower and without the   consent of any other Bank Lender (it is understood that (i) no existing   Bank Lender will have any obligation to commit to any such extension and   (ii) each Bank Lender under the class being extended shall have the   opportunity to participate in such extension on the same terms and conditions   as each other Bank Lender under such class).
    
	
 
    	
 
    	
 
    
	
Guarantees:
    	
 
    	
All obligations of the Borrower (the “Obligations”) under (i) the Senior Secured   Facilities, (ii) interest rate protection, commodity trading or hedging,   currency exchange or other non-speculative hedging or swap arrangements   permitted under the Senior Secured Facilities Documentation (other than any   obligation of any Guarantor to pay or perform under any agreement, contract,   or transaction that constitutes a “swap” within the meaning of   Section 1a(47) of the Commodity Exchange Act (a “Swap”),   if, and to the extent that, all or a portion of the guarantee by such   Guarantor of, or the grant by such Credit Party of a security interest to   secure, such Swap (or any guarantee thereof) is or becomes illegal under the   Commodity Exchange Act or any rule, regulation, or order of the Commodity   Futures Trading Commission (or the application or official interpretation of   any thereof)) entered into with (A) the Bank Administrative Agent, any   Arranger, any Bank Lender or any affiliate of the Bank Administrative Agent   or a Bank Lender at the time entered into or (B) any entity that was, or   whose affiliate was, the Bank Administrative Agent, an Arranger or a Bank   Lender on the Closing Date (the “Hedging Arrangements”)   and (iii) cash management and treasury arrangements entered into with   the Bank Administrative Agent, any Arranger, any Bank Lender or any affiliate   of the Bank Administrative Agent, an Arranger or a Bank Lender at the time   entered into (“Treasury Arrangements”) will be   unconditionally guaranteed jointly and severally on an equal priority senior   secured basis (the “Guarantees”)   by each existing and subsequently acquired or organized direct or indirect   wholly owned U.S. restricted subsidiary of the Borrower (other than any such   subsidiary (a) that is a subsidiary of a non-U.S. subsidiary of the   Borrower that is a “controlled foreign corporation” within the meaning of   Section 957 of the Code (a “CFC”),   (b) that is a U.S. subsidiary that has no material assets other than the   equity of one or more direct or indirect non-U.S. subsidiaries that are CFCs,   (c) that
    


 

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has been designated as an unrestricted   subsidiary, (d) that is below a materiality threshold (based on assets   or revenues) to be agreed, (e) that is not permitted by law, regulation   or contract existing on the Closing Date or on the date any such subsidiary   is acquired (so long as in respect of any such contractual prohibition such   prohibition is not incurred in contemplation of such acquisition) to provide   such guarantee, or would require governmental (including regulatory) consent,   approval, license or authorization to provide such guarantee, (unless such   consent, approval, license or authorization has been received), (f) that   is a special purpose entity, (g) any restricted subsidiary acquired   pursuant to a Permitted Acquisition (to be defined in a manner consistent   with the Documentation Principles) financed with secured indebtedness not   incurred in contemplation of such Permitted Acquisition permitted to be   incurred pursuant to the Senior Secured Facilities Documentation as assumed   indebtedness (and not incurred in contemplation of such Permitted   Acquisition) and any restricted subsidiary thereof that guarantees such   indebtedness, in each case to the extent such secured indebtedness prohibits   such subsidiary from becoming a Guarantor) and (h) Newco) (the “Guarantors”; and together with the Borrower, the “Credit Parties”). In addition, certain subsidiaries may be   excluded from the guarantee requirements under the definitive documentation   related to the Senior Secured Facilities in circumstances where the Borrower   and the Bank Administrative Agent reasonably agree that the cost of providing   such a guarantee (including any adverse tax consequences) is excessive in   relation to the value afforded thereby.
    
	
 
    	
 
    	
 
    
	
Unrestricted Subsidiaries:
    	
 
    	
The Senior Secured Facilities Documentation   will contain provisions pursuant to which, subject to limitations on loans,   advances, guarantees and other investments in, unrestricted subsidiaries, the   Borrower will be permitted to designate any existing or subsequently acquired   or organized subsidiary as an “unrestricted subsidiary” and subsequently   re-designate any such unrestricted subsidiary as a restricted subsidiary so   long as, after giving effect to any such designation or re-designation,   (a) the Borrower shall be in pro forma compliance with the Financial   Covenant recomputed as of the last day of the most recently ended fiscal   quarter of the Borrower for which financial statements are available,   (b) the fair market value of such subsidiary at the time it is   designated as an “unrestricted subsidiary” shall be treated as an investment   by the Borrower at such time and (c) no event of default under the   Senior Secured Facilities Documentation has occurred or is continuing or   would exist after giving effect thereto. Unrestricted subsidiaries will be   excluded from the guarantee requirements and will not be subject to the   representations and warranties, covenants, events of default or other   provisions of the Senior Secured Facilities Documentation, and the results of   operations and indebtedness of
    


 

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unrestricted subsidiaries will not be taken   into account for purposes of calculating any financial metric contained in   the Senior Secured Facilities Documentation except to the extent of   distributions received therefrom.
    
	
 
    	
 
    	
 
    
	
Security:
    	
 
    	
Subject to the limitations set forth below   in this section, and, on the Closing Date, the Funding Conditions Provision,   the Obligations, the Guarantees and any Hedging Arrangements or Treasury   Arrangements will be secured by substantially all of the present and after   acquired assets of each of the Credit Parties (collectively, but excluding   the Excluded Assets (as defined below), the “Collateral”),   including, (a) a perfected first priority pledge of all the capital   stock of each direct, wholly owned material restricted subsidiary held by any   Credit Party (which pledge, in the case of any foreign subsidiary of a U.S.   Credit Party or a subsidiary of the type described in clause (b) under   the heading “Guarantees”) shall be limited to 65% of the voting capital stock   and 100% of the non-voting capital stock of such subsidiary) and (b) a   perfected first priority security interest in substantially all other tangible   and intangible assets of the Credit Parties (including but not limited to   accounts receivable, inventory, equipment, general intangibles, investment   property, real property, intellectual property and the proceeds of the   foregoing).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding anything to the contrary,   the Collateral shall exclude the following: (i) any fee owned real   property with a value of less than an amount to be agreed (with all required   mortgages being permitted to be delivered post-closing) and all real property   leasehold interests (including requirements to deliver landlord lien waivers,   estoppels and collateral access letters), (ii) motor vehicles and other   assets subject to certificates of title, letter of credit rights (other than   to the extent such rights can be perfected by filing a UCC-1) and commercial   tort claims below a threshold to be agreed, (iii) those assets over   which the granting of security interests in such assets would be prohibited   by applicable law or regulation (in each case, except to the extent such   prohibition is unenforceable after giving effect to applicable provisions of   the Uniform Commercial Code or other applicable law, other than proceeds   thereof, the assignment of which is expressly deemed effective under the   Uniform Commercial Code or other applicable law notwithstanding such   prohibitions) or to the extent that such security interests would require   obtaining the consent of any governmental authority (unless such consent has   been received) or would result in materially adverse tax consequences as   reasonably determined in writing by the Borrower and the Bank Administrative   Agent, (iv) any foreign collateral or credit support (iv) margin   stock and, to the extent requiring the consent of one or more third parties   (other than the Borrower or any Guarantor) or prohibited by the terms of any
    


 

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applicable organizational documents, joint   venture agreement or shareholders’ agreement, equity interests in any person   other than wholly owned material restricted subsidiaries, (v) those   assets as to which the Bank Administrative Agent and the Borrower reasonably   determine in writing that the cost of obtaining such a security interest or   perfection thereof are excessive in relation to the benefit to the Bank   Lenders of the security to be afforded thereby, (vi) any intent-to-use   trademark application prior to the filing of a “Statement of Use” or   “Amendment to Allege Use” with respect thereto, (vii) any lease, license   or other agreement or any property subject to a purchase money security   interest, capital lease obligation or similar arrangement (in each case to   the extent permitted under the Senior Secured Facilities Documentation) to   the extent that a grant of a security interest therein would violate or   invalidate such lease, license or agreement or purchase money, capital lease   or similar arrangement or create a right of termination in favor of any other   party thereto (other than the Borrower or a Guarantor) after giving effect to   the applicable anti-assignment provisions of the Uniform Commercial Code or   other applicable law, other than proceeds and receivables thereof, the   assignment of which is expressly deemed effective under the Uniform   Commercial Code or other applicable law notwithstanding such prohibition,   (viii) equity interests in Newco and (ix) other exceptions to be   mutually agreed or that are usual and customary for facilities of this type   consistent with the Documentation Principles. The foregoing described in   clauses (i) through (ix) are, collectively, the “Excluded Assets”.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
No actions in any non-U.S. jurisdiction or   required by the laws of any non-U.S. jurisdiction shall be required to be   taken to create any security interests in assets located or titled outside of   the U.S. or to perfect or make enforceable any security interests in any   assets located or titled outside of the U.S. (it being understood that there   shall be no security agreements or pledge agreements governed under the laws   of any non U.S. jurisdiction) and no control agreements or other control   arrangements shall be required with respect to letter-of-credit rights,   electronic chattel paper or any assets requiring perfection through control   agreements (including without limitation deposit accounts and other bank or   securities accounts). All the above-described pledges, security interests and   mortgages shall be created on terms in the Senior Secured Facilities   Documentation, and none of the Collateral or other assets of the Credit   Parties shall be subject to other pledges, security interests or mortgages,   subject to customary exceptions for financings of this kind consistent with   the Documentation Principles.
    
	
 
    	
 
    	
 
    
	
Intercreditor Agreement:
    	
 
    	
The relative rights and priorities in the   Collateral for the secured parties under (a) the Senior Secured   Facilities and (b) the
    


 

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Secured Bridge Loans will be set forth in a   customary intercreditor agreement as between the Bank Administrative Agent,   on the one hand, and the Bridge Administrative Agent, on the other hand (the   “Intercreditor Agreement”) and being   reasonably satisfactory to the Bank Administrative Agent, the Bridge   Administrative Agent and the Borrower pursuant to which Intercreditor   Agreement the liens on the Collateral securing the Senior Secured Facilities   will be pari passu with the liens on the Collateral securing the Secured   Bridge Loans.
    
	
 
    	
 
    	
 
    
	
Mandatory Prepayments:
    	
 
    	
The Term B Loans shall be prepaid with   (a) 100% of the net cash proceeds received from the incurrence of   indebtedness by the Borrower or any of its domestic restricted subsidiaries   (other than indebtedness permitted under the Senior Secured Facilities) and   (b) 100% of the net cash proceeds of all non-ordinary course asset sales   or other dispositions of property (including casualty and condemnation   events) by the Borrower and its restricted subsidiaries, other than any sale   or disposition of equity interests of Newco or of the shares of the capital   stock of the Company acquired in the Stock Buy-Back, and in each case subject   to the right of the Borrower to reinvest such proceeds if such proceeds are   reinvested (or committed to be reinvested) within 12 months and, if so   committed to reinvestment, reinvested within 6 months thereafter, and other   exceptions to be agreed upon. Notwithstanding the foregoing, mandatory   prepayments with respect to clause (b) above shall be limited to the   extent that the Borrower determines that such prepayments would either   (i) result in adverse tax consequences related to the repatriation of   funds in connection therewith by foreign subsidiaries or (ii) be   prohibited or delayed by applicable law. Within the Term B Facility,   mandatory prepayments shall be applied to the scheduled installments of   principal of the Term B Facility in direct order of maturity. Any Term B   Lender may elect not to accept any mandatory prepayment made pursuant to   clause (a) or (b) above (each a “Declining   Lender”). Any prepayment amount declined by a Declining Lender,   subject to any prepayment requirements of the Notes and/or Bridge Facilities,   may be retained by the Borrower.
    
	
 
    	
 
    	
 
    
	
Voluntary Prepayments:
    	
 
    	
Solely to the extent that such prepayment   (including repricings or refinancings) is made with the proceeds of new   indebtedness whose yield (taking into account any applicable interest rate   margin, original issue discount, up-front fees and any LIBOR “floor”) is   lower than the yield applicable to the Term B Facility immediately prior to   such prepayments, voluntary prepayments, repricings or refinancings of the   Term B Facility (but excluding any prepayments, repricings or refinancings in   connection with a change of control) made prior to the 6-month anniversary of   the Closing Date shall be made at 101.0% of the amount so prepaid, repaid,   repriced or refinanced.
    


 

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Subject to the above, voluntary reductions   of the unutilized portion of the Revolving Commitments and prepayments of   borrowings under the Senior Secured Facilities will be permitted at any time,   in minimum principal amounts to be agreed upon, without premium or penalty,   subject to reimbursement of the Bank Lenders’ redeployment costs actually   incurred in the case of a prepayment of LIBOR borrowings other than on the   last day of the relevant interest period. All voluntary prepayments of the   Term B Facility and any Incremental Term Facility will be applied to the   remaining amortization payments under the Term B Facility or such Incremental   Term Facility, as directed by the Borrower (and absent such direction, in   direct order of maturity thereof), including to any class of extending or   existing Loans in such order as the Borrower may designate, and shall be   applied to either the Term B Facility or any Incremental Term Facility as   determined by the Borrower.
    
	
 
    	
 
    	
 
    
	
Senior   Secured Facilities Documentation:
    	
 
    	
The definitive documentation for the Term B   Facility and the Revolving Facility (collectively, the “Senior   Secured Facilities Documentation”) will be “covenant-lite” with   incurrence-based covenants consistent with and substantially similar to the   corresponding terms of the Notes Offering (with reasonable modifications to   the mechanical and agency provisions to reflect the administrative guidelines   and practices of the Bank Administrative Agent), and will contain the terms   set forth in this Annex B and, to the extent not specified in Annex B, such   other terms as are customary for similar financings of comparable issuers as   modified to reflect the operational and strategic requirements of the   Borrower and its subsidiaries in light of their size, industries, businesses   and business practices, operations, financial accounting and projections, and   will otherwise be negotiated in good faith within a reasonable time period to   be determined based on the expected Closing Date (such requirements, the “Documentation Principles”). The Senior Secured Facilities   Documentation shall contain only those payments, conditions to borrowing,   mandatory prepayments, representations and warranties, covenants and events   of default expressly set forth in this Annex B, in each case applicable to   the Borrower and its restricted subsidiaries and with standards, definitions,   qualifications, thresholds, exceptions, baskets and grace periods consistent   with the Documentation Principles.
    
	
 
    	
 
    	
 
    
	
Conditions   Precedent to Initial Borrowing:
    	
 
    	
The availability of the initial borrowing   and other extensions of credit under the Senior Secured Facilities will be   subject solely to (i) the applicable conditions set forth in Annex D to   the Commitment Letter, (ii) accuracy of representations and warranties   in all material respects (provided that any such representations and   warranties which are qualified by
    


 

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materiality, material adverse effect or   similar language shall be true and correct in all respects),   (iii) absence of defaults or events of default and (iv) the   delivery of a customary borrowing notice.
    
	
 
    	
 
    	
 
    
	
Conditions   Precedent to All Subsequent   Borrowings:
    	
 
    	
After the Closing Date, each extension of   credit will be conditioned upon: delivery of notice, accuracy of   representations and warranties in all material respects (provided that   any such representations and warranties which are qualified by materiality,   material adverse effect or similar language shall be true and correct in all   respects) and absence of defaults or events of default, provided that   if the compliance certificate for the most recently ended fiscal quarter for   which financial statements have been delivered does not include a calculation   of the Financial Covenant (as defined below) because the Financial Covenant   was not required to be tested as of the last day of such fiscal quarter, the   making of any Revolving Loan or issuance of letter of credit shall be subject   to delivery of the calculation of the Financial Covenant as of the last day   of such fiscal quarter demonstrating compliance with the applicable Financial   Covenant level as of the last day of such fiscal quarter (on an actual, and   not a pro forma, basis).
    
	
 
    	
 
    	
 
    
	
Representations and Warranties:
    	
 
    	
Limited to the following: organizational   status; power and authority, qualification, execution, delivery and   enforceability of Senior Secured Facilities Documentation; with respect to   the execution, delivery and performance of the Senior Secured Facilities   Documentation, no violation of, or conflict with, law, charter documents or   material agreements; compliance with law; litigation; margin regulations;   material governmental approvals with respect to the execution, delivery and   performance of the Senior Secured Facilities; Investment Company Act; PATRIOT   Act; accuracy of disclosure and financial statements; since the Closing Date,   no Material Adverse Effect (as defined below) (it being understood that, for   purposes of the initial borrowing and other extensions of credit on the   Closing Date, such definition shall be Company Material Adverse Effect (as   defined in Section 2 of the Commitment Letter)); taxes; ERISA; FCPA;   OFAC; insurance; subsidiaries; intellectual property; creation, validity and   perfection of security interests; environmental laws; properties;   consolidated closing date solvency; use of proceeds; and status as senior   debt; subject, in the case of each of the foregoing representations and   warranties, to qualifications and limitations for materiality consistent with   the Documentation Principles.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“Material Adverse Effect”   shall mean a circumstance or condition that has, or would reasonably be   expected to have, a material adverse effect on (a) the business, assets,   operations, or financial condition of the Borrower and its subsidiaries,   taken as
    


 

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a whole, (b) the ability of the   Borrower and the other Credit Parties, taken as a whole, to perform their   payment obligations under the Senior Secured Facilities Documentation or   (c) the material rights and remedies of the Bank Administrative Agent   and the Bank Lenders under the Senior Secured Facilities Documentation.
    
	
 
    	
 
    	
 
    
	
Affirmative Covenants:
    	
 
    	
Limited to the following (to be applicable   to the Borrower and its restricted subsidiaries): delivery of annual and   quarterly financial statements and other information (with 90 days for   delivery of the annual financial statements and 45 days for the first three   quarterly financial statements), and with annual financial statements to be   accompanied by an audit opinion from nationally recognized auditors that is not   subject to qualification as to “going concern” or the scope of such audit   other than solely with respect to, or resulting solely from (i) an   upcoming maturity date under the Revolving Facility occurring within one year   from the time such opinion is delivered or (ii) any potential inability   to satisfy any financial maintenance covenant on a future date or in a future   period; delivery of notices of defaults and certain material events;   maintenance of organizational existence and rights and privileges; maintenance   of insurance; payment of taxes; compliance with laws; ERISA; environmental;   transactions with affiliates; changes in fiscal year; Lender calls (which can   be the same as public earnings calls); additional guarantors and collateral;   use of proceeds; changes in lines of business; inspection of books and   records; maintenance of ratings (but no specific ratings); a passive activity   covenant with respect to Newco (including no operations or assets other than   the holding of the capital stock of the Company subject to the Stock   Buy-Back, and a requirement to dividend back to the Company any dividends on   capital stock it may receive); and further assurances; subject, in the case   of each of the foregoing covenants, to exceptions and qualifications   consistent with the Documentation Principles.
    
	
 
    	
 
    	
 
    
	
Negative Covenants:
    	
 
    	
Limited to (to be applicable to the Borrower   and its restricted subsidiaries): limitations on the incurrence of debt   (which shall permit (i) incremental credit facilities,   (ii) (x) unsecured indebtedness and (y) acquired indebtedness,   in each case subject to pro forma compliance with a fixed charge coverage   ratio test of 2.25:1.00, (iii) exceptions for purchase money   indebtedness and capital leases up to an amount to be agreed and (iv) a   general basket in an amount to be agreed); liens (which shall not apply to   any margin stock); fundamental changes; restrictions on subsidiary   distributions and negative pledges (which shall not apply to any margin   stock); asset sales (which shall be permitted subject to (i) a 75% cash   consideration requirement (with the ability to designate certain non-cash   assets as cash) and (ii) a fair market value requirement and compliance   with mandatory
    


 

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prepayments); transactions with affiliates;   changes in fiscal year; and restricted payments (including dividends,   acquisitions and other investments and prepayment of subordinated debt))   (which covenant will include the following exceptions and baskets: (i) a   general basket, (ii) a carve-out permitting dividends consistent with   past practice (including an annual growth factor up to 7.5%), (iii) a   basket for investments in restricted subsidiaries that are not Guarantors and   (iv) a basket based on the sum of (a) 50% of Consolidated Net   Income, (b) 100% of qualified equity proceeds and (c) other amounts   to be determined); subject, in the case of each of the foregoing covenants,   to exceptions, qualifications and, as appropriate, baskets to be agreed upon   consistent with the Documentation Principles.
    
	
 
    	
 
    	
 
    
	
Financial Covenants:
    	
 
    	
With respect to the Term B Facility: None.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
With respect to the Revolving Facility:   Limited to the following financial maintenance covenant (the “Financial Covenant”): a maximum Senior Secured Net   Leverage Ratio.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Financial Covenant (x) will be   tested quarterly commencing with the first full fiscal quarter to occur after   the Closing Date; provided that the Financial Covenant shall be tested   only if Revolving Loans (including the aggregate amount of swingline loans   and the aggregate face amount of letters of credit then outstanding under the   Revolving Facility to the extent not cash collateralized, but excluding   (i) letters of credit existing on the Closing Date and any extensions thereof,   replacement letters of credit or letters of credit issued in lieu thereof, in   each case, to the extent the face amount of such letters of credit is not   increased above the face amount of the letter of credit being extended,   replaced or substituted (it being understood and agreed that in no event   shall the aggregate principal amount of letters of credit excluded pursuant   to this clause (i) be more than an amount to be mutually agreed) and   (ii) other non-cash collateralized letters of credit in an aggregate   amount not to exceed an amount to be mutually agreed) are or would be   outstanding in an amount exceeding 15% of the total facility amount of the   Revolving Facility and (y) will be set at a level of 2.50:1.00 for each   fiscal quarter .
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“EBITDA” shall   be defined in a manner consistent with the Documentation Principles and in   any event shall include, without limitation, add-backs, deductions and   adjustments, as applicable, without duplication, for (a) non-cash items,   (b) extraordinary, unusual or non-recurring items,   (c) restructuring charges and related charges, (d) pro forma   adjustments, pro forma cost savings, operating expense reductions and cost   synergies, in each case, related to mergers and other business combinations,   acquisitions, divestitures and other similar transactions
    


 

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(including in respect of the pro forma   adjustments and addbacks set forth in clause (c) above) consummated by   the Borrower and projected by the Borrower in good faith to result from   actions taken or expected to be taken (in the good faith determination of the   Borrower) within six fiscal quarters after the date any such transaction is   consummated so long as such pro forma adjustments, pro forma cost savings,   operating expense reductions and cost synergies are reasonably identifiable   and factually supportable, (e) “run rate” cost savings, operating   expense reductions and synergies projected by the Borrower in good faith to   result from actions either taken or expected to be taken within 18 months   after the date of determination to take such action, so long as such cash   savings and synergies are reasonably identifiable and factually supportable   and (f) adjustments and add backs reasonably agreed with the Arrangers   to be reflected in the Confidential Information Memorandum provided by the   Company.
    
	
 
    	
 
    	
 
    
	
Events of Default:
    	
 
    	
Limited to the following (to be applicable   to the Borrower and its restricted subsidiaries): nonpayment of principal,   interest or other amounts; violation of covenants; incorrectness of   representations and warranties in any material respect; cross default and   cross acceleration to material indebtedness; bankruptcy and insolvency of the   Borrower or any of its significant restricted subsidiaries; material monetary   judgments against the Borrower or any of its significant restricted   subsidiaries; ERISA events; actual or asserted invalidity of material   guarantees or security documents or any security interest purported to be   created thereunder (including failure to be perfected on a first-priority   basis subject to certain customary exceptions); and change of control,   subject to threshold, notice and grace period provisions consistent with the   Documentation Principles.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding the foregoing, (x) only   lenders holding at least a majority of the Revolving Commitments and   Revolving Loans shall have the ability to (and be required in order to) amend   the Financial Covenant and waive a breach of the Financial Covenant, and   (y) a breach of the Financial Covenant shall not constitute an event of   default with respect to the Term B Facility or trigger a cross-default under   the Term B Facility until the date on which the Revolving Loans (if any) have   been accelerated or the Revolving Commitments have been terminated, in each   case, by the Revolving Lenders in accordance with the terms of the Revolving   Facility.
    
	
 
    	
 
    	
 
    
	
Voting:
    	
 
    	
Amendments and waivers of the Senior Secured   Facilities Documentation will require the approval of Bank Lenders holding   more than 50% of the aggregate amount of the loans and commitments under the   Senior Secured Facilities held by the
    


 

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Bank Lenders (other than Defaulting Bank   Lenders) (the “Required Lenders”), except that   (i) the consent of each Bank Lender directly and adversely affected   thereby shall be required with respect to: (A) increases in the   commitment of such Bank Lender, (B) reductions of principal, interest or   fees owing to such Bank Lender, (C) extensions or postponement of final   maturity, and (D) releases of all or substantially all the value of the   Guarantees or releases of liens on all or substantially all of the   Collateral, (ii) the consent of 100% of the Bank Lenders will be   required with respect to modifications to any of the voting percentages that   result in a decrease of voting rights for Bank Lenders and   (iii) customary protections for the Bank Administrative Agent, the   Swingline Lender and the Issuing Lenders will be provided.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding the foregoing, amendments   and waivers of the Financial Covenant will be subject to the second paragraph   under “Events of Default” above.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Senior Secured Facilities shall contain   provisions permitting the Borrower to replace (i) non-consenting Bank Lenders   in connection with amendments and waivers requiring the consent of all Bank   Lenders or of all Bank Lenders directly affected thereby so long as the   Required Lenders shall have consented thereto and (ii) Defaulting Bank   Lenders.
    
	
 
    	
 
    	
 
    
	
Cost and Yield Protection:
    	
 
    	
The Senior Secured Facilities Documentation   will include tax gross-up, cost and yield protection provisions substantially   consistent with the Documentation Principles (including with respect to the   Dodd-Frank Act and the Basel Committee on Banking Regulations and Supervisory   Practices). The Senior Secured Facilities shall contain provisions regarding   the timing for asserting a claim under the cost and yield protection   provisions and permitting the Borrower to replace a Bank Lender who asserts such   claim without premium or penalty.
    
	
 
    	
 
    	
 
    
	
Assignments and Participations:
    	
 
    	
The Bank Lenders will be permitted to assign   (a) Term B Loans with the consent of the Borrower (not to be   unreasonably withheld or delayed and such consent shall be deemed to be given   after 10 business days’ notice of a failure to respond) and   (b) Revolving Commitments with the consent of the Borrower (not to be   unreasonably withheld or delayed and, in each case, such consent shall be   deemed to be given after 10 business days’ notice of a failure to respond),   the Swingline Lender and each Issuing Lender; provided that no consent   of the Borrower shall be required (i) after the occurrence and during   the continuance of a payment or bankruptcy event of default (with respect to   the Borrower) or (ii) for assignments of Term B Loans to any existing   Bank Lender or an affiliate of an existing Bank Lender or an approved fund.   All assignments will require the consent of
    


 

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the Bank Administrative Agent unless such   assignment is an assignment of Term B Loans to another Bank Lender, an   affiliate of a Bank Lender or an approved fund, not to be unreasonably   withheld or delayed. Assignments to natural persons and Disqualified Lenders   shall be prohibited. Each assignment will be in an amount of an integral   multiple of $1.0 million with respect to the Term B Facility and $5.0 million   with respect to the Revolving Facility or, in each case, if less, all of such   Bank Lender’s remaining loans and commitments of the applicable class.   Assignments will not be required to be pro rata among the Senior Secured   Facilities. The Bank Administrative Agent shall receive a processing and   recordation fee of $3,500 for each assignment (unless waived by the Bank   Administrative Agent).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Bank Lenders will be permitted to sell   participations in the Senior Secured Facilities without restriction, other   than as set forth in the next sentence, and in accordance with applicable   law. Voting rights of participants shall be limited to matters in respect of   (a) increases in commitments participated to such participants,   (b) reductions of principal, interest or fees, (c) extensions of   final maturity or the scheduled date of any principal, interest or fees and   (d) releases of all or substantially all of the value of the Guarantees   or all or substantially all of the Collateral.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Senior Secured Facilities Documentation   shall provide that Term B Loans may be purchased and assigned on a non-pro   rata basis through (a) open market purchases and (b) Dutch auction   or similar procedures to be agreed that are offered to all Lenders on a pro   rata basis in accordance with customary procedures to be agreed and subject   to customary restrictions to be agreed (including, without limitation,   (1) no default or event of default has occurred and is continuing,   (2) the Borrower and any other affiliates of the Borrower shall be   eligible assignees with respect to Term B Loans only and (3) such open   market purchases and Dutch auctions shall be subject to customary provisions   regarding the absence of material non-public information with respect to the   business of the Borrower and its subsidiaries); provided that any such   Term B Loans acquired by the Borrower or any of its respective subsidiaries   shall be retired and cancelled promptly upon acquisition thereof.
    
	
 
    	
 
    	
 
    
	
Expenses and Indemnification:
    	
 
    	
The Senior Secured Facilities Documentation   will provide customary and appropriate provisions relating to indemnity and   related matters in a form reasonably satisfactory to the Bank Lead Arrangers,   the Bank Administrative Agent and the Lenders.
    
	
 
    	
 
    	
 
    
	
Governing Law and Forum:
    	
 
    	
New York.
    
	
 
    	
 
    	
 
    
	
Counsel to the Agents:
    	
 
    	
Cahill Gordon & Reindel LLP.
    


 

Annex B - 19











 

Exhibit I to Annex B

 

	
Interest Rates:
    	
 
    	
The interest rates under the Senior Secured   Facilities will be as follows:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Revolving Facility
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
At the option of the Borrower, initially,   LIBOR plus 2.50% or ABR plus 1.50%. From and after the delivery by the   Borrower to the Bank Administrative Agent of financial statements for the   period ending at least one full fiscal quarter following the Closing Date,   the applicable margins under the Revolving Facility shall be subject to a   step-down to LIBOR plus 2.25% or ABR plus 1.25% based upon achievement of a   Senior Secured Net Leverage Ratio to be mutually agreed.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Term B Facility
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
At the option of the Borrower, initially,   LIBOR plus 2.75% or ABR plus 1.75%.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
All Senior Secured Facilities
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Borrower may elect interest periods of   1, 2, 3 or 6 months (or, if available to all relevant Bank Lenders, 12 months   or a shorter period) for LIBOR borrowings.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Calculation of interest shall be on the   basis of the actual days elapsed in a year of 360 days (or 365 or 366 days,   as the case may be, in the case of ABR loans based on the Prime Rate) and   interest shall be payable at the end of each interest period and, in any   event, at least every 3 months and on the applicable maturity date.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
ABR is the highest of (i) the rate of   interest publicly announced by the Bank Administrative Agent as its prime   rate in effect at its principal office in New York City (the “Prime Rate”), (ii) the federal funds effective rate   from time to time plus 0.50% and (iii) LIBOR (after taking account of   any applicable floor) applicable for an interest period of one month plus   1.00%.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
LIBOR is the London interbank offered rate   for dollars, for the relevant interest period; provided that, solely   with respect to the Term B Facility, LIBOR shall be deemed to be no less than   0.75% per annum.
    
	
 
    	
 
    	
 
    
	
Letter of Credit Fees:
    	
 
    	
A per annum fee equal to the spread over   LIBOR (less the fronting fee described below) under the Revolving Facility   will accrue for the account of Revolving Lenders (other than Defaulting Bank   Lenders) on the aggregate face amount of outstanding Letters of Credit,   payable in arrears at the end of
    


 

Annex B - 20











 

	
 
    	
 
    	
each quarter and upon the termination of the   Revolving Facility, in each case for the actual number of days elapsed over a   360-day year. Such fees shall be distributed to such Revolving Lenders pro   rata in accordance with the amount of each such Revolving Lender’s Revolving   Commitment. In addition, the Borrower shall pay to the relevant Issuing   Lender, for its own account, (a) a fronting fee equal to 0.125% of the   aggregate face amount of outstanding Letters of Credit or such other amount   as may be agreed by the Borrower and such Issuing Lender, payable in arrears   at the end of each quarter and upon the termination of the Revolving   Facility, calculated based upon the actual number of days elapsed over a   360-day year, and (b) customary issuance and administration fees.
    
	
 
    	
 
    	
 
    
	
Revolving Commitment Fees:
    	
 
    	
Initially, 0.375% per annum on the undrawn   portion of the Revolving Commitments, payable to non-Defaulting Bank Lenders   quarterly in arrears after the Closing Date and upon the termination of the   Revolving Commitments, calculated based on the number of days elapsed in a   360-day year.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
From and after the delivery by the Borrower   to the Bank Administrative Agent of financial statements for the period   ending at least one full fiscal quarter following the Closing Date, the   commitment fees under the Revolving Facility shall be subject to a stepdown   to 0.25% based upon achievement of a Senior Secured Net Leverage Ratio to be   mutually agreed.
    


 

Annex B - 21











 

Annex C

 

Summary of the Unsecured Bridge Facility

 

This Summary outlines certain terms of the Unsecured Bridge Facility referred to in the Commitment Letter, of which this Annex C is a part.  Certain capitalized terms used herein are defined in the Commitment Letter.

 

	
Borrower:
    	
 
    	
The Borrower under the Senior Secured   Facilities (the “Borrower”).
    
	
 
    	
 
    	
 
    
	
Joint   Lead Arrangers and Joint Lead Bookrunners:
    	
 
    	
J.P. Morgan Securities LLC (“J.P. Morgan”) and Merrill Lynch, Pierce, Fenner &   Smith Incorporated (or any of its designated affiliates) (“Merrill Lynch”), in each case in its capacity as Joint   Lead Arranger and Joint Bookrunner  (together with any Additional   Arrangers appointed in accordance with Section 1 of the Commitment   Letter, collectively, the “Bridge Lead Arrangers”   or, the “Arrangers”).
    
	
 
    	
 
    	
 
    
	
Syndication Agent:
    	
 
    	
Merrill Lynch, in its capacity as   syndication agent (the “Syndication Agent”).
    
	
 
    	
 
    	
 
    
	
Bridge Administrative Agent:
    	
 
    	
JPMorgan Chase Bank, N.A. (“JPMCB”), in its capacity as administrative agent (the “Bridge Administrative Agent”).
    
	
 
    	
 
    	
 
    
	
Lenders:
    	
 
    	
JPMCB, Bank of America, N.A. (“Bank of America”) and/or other financial institutions   selected by the Bridge Lead Arrangers reasonably acceptable to the Borrower   (each, an “Unsecured Bridge Lender” and,   collectively, the “Unsecured Bridge Lenders”   and together with the “Bank Lenders”   and the Secured Bridge Lenders, the “Lenders”).
    
	
 
    	
 
    	
 
    
	
Amounts of Bridge Loans:
    	
 
    	
$1,500 million in aggregate principal amount   of senior unsecured increasing rate loans, less the amount of gross proceeds   from any sale of Unsecured Notes received on the Closing Date (the “Unsecured Bridge Loans”). $1,000 million of Unsecured   Bridge Loans shall be designated “Eight Year Bridge Loans”,   and $500 million of the Unsecured Bridge Loans shall be designated as “Ten Year Bridge Loans”.
    
	
 
    	
 
    	
 
    
	
Availability:
    	
 
    	
The Unsecured Bridge Lenders will make the   Unsecured Bridge Loans on the Closing Date. Amounts borrowed under the   Unsecured Bridge Facility that are repaid or prepaid may not be reborrowed.
    
	
 
    	
 
    	
 
    
	
Use of Proceeds:
    	
 
    	
The proceeds of the Unsecured Bridge Loans   will be used by the Borrower on the Closing Date, together with the proceeds   of borrowings under the Senior Secured Facilities, the proceeds of borrowings   under the Secured Bridge Facility, the proceeds from
    


 

Annex C - 1











 

	
 
    	
 
    	
the issuance of Notes, and cash on hand of   the Borrower, to fund the Stock Buy-Back.
    
	
 
    	
 
    	
 
    
	
Ranking:
    	
 
    	
The Unsecured Bridge Loans, the Guarantee   and all obligations with respect thereto will be senior obligations and rank pari passu in right of payment with all of the Borrower’s   and the Guarantors’ existing and future senior obligations (including the   obligations under the Senior Secured Facilities).
    
	
 
    	
 
    	
 
    
	
Guarantees:
    	
 
    	
All obligations of the Borrower under the   Unsecured Bridge Facility will be jointly and severally guaranteed by each   Guarantor (as defined in Exhibit B to the Commitment Letter), on a   senior basis (such guarantees, the “Bridge Guarantees”).   The Bridge Guarantees will automatically be released upon the release of the   corresponding guarantees of the Senior Secured Facilities. The Bridge   Guarantees will rank equal in right of payment with the guarantees of the   Senior Secured Facilities.
    
	
 
    	
 
    	
 
    
	
Security:
    	
 
    	
None.
    
	
 
    	
 
    	
 
    
	
Conversion into Rollover Loans:
    	
 
    	
If the Unsecured Bridge Loans have not been   previously prepaid in full for cash on or prior to the Conversion Date, the   principal amount of the Unsecured Bridge Loans outstanding on the Conversion   Date may, subject to no payment or bankruptcy event of default and the other   conditions precedent set forth in this Annex C, be converted into   (i) with respect to Eight Year Bridge Loans, senior unsecured rollover   loans that will mature on the eighth anniversary of the Closing Date and   (ii) with respect to the Ten Year Bridge Loans, senior unsecured   rollover loans that will mature on the tenth anniversary of the Closing Date   (collectively, the “Unsecured Rollover Loans”).
    
	
 
    	
 
    	
 
    
	
Exchange into Exchange Notes:
    	
 
    	
At any time and from time to time, on or   after the Conversion Date, upon reasonable prior written notice and in a   minimum principal amount of at least $100.0 million, the Unsecured   Rollover Loans may be exchanged, in whole or in part, at the option of the   applicable Lender or Lenders, for senior exchange notes (the “Exchange Notes”), in a principal amount equal to the   principal amount of the Unsecured Bridge Loans so exchanged and having the   same maturity date as the Unsecured Bridge Loans so exchanged. To the extent   Eight Year Bridge Loans are exchanged, the Exchange Notes will be unsecured   and have a maturity date eight years from the Closing Date (the “Eight Year Exchange Notes”) and to the extent Ten Year   Bridge Loans are exchanged, the Exchange Notes will be unsecured and have a   maturity date ten years from the Closing Date (the “Ten Year   Exchange Notes”).
    


 

Annex C - 2











 

	
 
    	
 
    	
The Exchange Notes will be issued pursuant   to an indenture (the “Indenture”)   that will have the terms set forth on Exhibit 1 to this Annex C.
    
	
 
    	
 
    	
 
    
	
Demand Failure Event:
    	
 
    	
Any failure to comply with the terms of a   Securities Demand (as defined in the Fee Letter) for any reason will be   deemed to be a “Demand Failure Event”   (as defined in the Fee Letter) under the Unsecured Bridge Facility   Documentation.
    
	
 
    	
 
    	
 
    
	
Interest Rate:
    	
 
    	
Until the earlier of (i) the first   anniversary of the Closing Date or (ii) the occurrence of a Demand   Failure Event (such earlier date, the “Conversion Date”),   the Unsecured Bridge Loans will bear interest at a floating rate, reset   quarterly, as follows: (x) for the first three-month period commencing   on the Closing Date, (1) the Eight Year Bridge Loans will bear interest   at a rate per annum equal to LIBOR (subject   to a floor of 0.75% per annum) plus 5.50% and (2) the Ten Year Bridge   Loans will bear interest at a rate per annum equal to LIBOR (subject to a   floor of 0.75% per annum) plus 6.125%; provided that, in each case,   such interest rate spread shall increase by 25 basis points per annum if the Borrower shall have not received a public   corporate credit rating of at least BB by S&P and a public family rating   of at least Ba2 by Moody’s (in each case, with an outlook of stable or   better) and (y) thereafter, interest on the Unsecured Bridge Loans will   be payable at a floating per annum   rate equal to the interest rate applicable during the prior three-month   period, in each case plus the Bridge Spread, reset at the beginning of each   subsequent three-month period. The “Bridge Spread”   will initially be 50 basis points (commencing three months after the Closing Date)   and will increase by an additional 50 basis points every three months   thereafter. Notwithstanding the foregoing, at no time will the per annum   interest rate on the Unsecured Bridge Loans exceed the applicable Total Cap   (as defined in the Fee Letter) then in effect (plus default interest, if   any).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
From and after the Conversion Date, the   Unsecured Bridge Loans will bear interest at a fixed rate equal to the   applicable Total Cap (plus default interest, if any).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Prior to the Conversion Date, interest will   be payable at the end of each interest period. Accrued Interest shall also be   payable in arrears on the Conversion Date and on the date of any prepayment   of the Unsecured Bridge Loans. From and after the Conversion Date, interest   will be payable quarterly in arrears and on the date of any prepayment of the   Unsecured Bridge Loans.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
After the occurrence and during the   continuance of an event of default, interest on all overdue amounts then   outstanding will accrue at a rate equal to the applicable rate set forth   above, plus
    


 

Annex C - 3












 

	
 
    	
 
    	
an additional two percentage points (2.00%) per annum and will be payable on demand.
    
	
 
    	
 
    	
 
    
	
Funding Protection:
    	
 
    	
Customary for transactions of this type,   including breakage costs, gross-up for withholding, compensation for   increased costs and compliance with capital adequacy and other regulatory   restrictions.
    
	
 
    	
 
    	
 
    
	
Mandatory Prepayment:
    	
 
    	
Prior to the Conversion Date, the net   proceeds to the Borrower, from (a) any direct or indirect public   offering or private placement of any debt or equity securities (other than   issuances pursuant to employee stock plans or any sale or disposition of   equity interests of Newco or the shares of the capital stock of the Company   acquired in the Stock Buy-Back), (b) any future bank borrowings (other   than pursuant to the Senior Secured Facilities and any refinancings or   replacements thereof) and (c) subject to certain ordinary course   exceptions and reinvestment rights, any future asset sales or other   dispositions of property (including casualty and condemnation events) by the   Borrower and its restricted subsidiaries, other than any sale or disposition   of equity interests of Newco or of the shares of the capital stock of the   Company acquired in the Stock Buy-Back, will be used to repay the Unsecured   Bridge Loans, in excess of amounts either reinvested or required to be paid   to the lenders under the Senior Secured Facilities.  Any proceeds from the issuance of Notes   purchased by a Lender or one or more of its affiliates will be applied,   first, to refinance the Unsecured Bridge Loans held at that time by such   Lender, and second, in accordance with the pro rata   provisions otherwise applicable to prepayments. Notwithstanding the   foregoing, mandatory prepayments under clause (c) above shall be limited to   the extent that the Borrower determines that such prepayments may either (i)   result in adverse tax consequences related to the repatriation of funds in   connection therewith by foreign subsidiaries or (ii) be prohibited or delayed   by applicable law.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Nothing in these mandatory prepayment   provisions will restrict or prevent any holder of Unsecured Bridge Loans from   exchanging Unsecured Bridge Loans for Unsecured Exchange Notes on or after   the Conversion Date.
    
	
 
    	
 
    	
 
    
	
Change of Control:
    	
 
    	
Upon the occurrence of a Change of Control   (to be defined),  the Borrower will be   required to prepay in full all outstanding Unsecured Bridge Loans at par plus   accrued interest to the date of prepayment plus with respect to any Unsecured   Bridge Loans so prepaid on or after the Conversion Date, a 1.0% prepayment   premium.  Prior to making any such   prepayment, the Borrower will, within 30 days of the Change of Control, repay   all obligations under the Senior Secured Facilities or obtain any required   consent of the lenders under the Senior Secured
    


 

Annex C - 4











 

	
 
    	
 
    	
Facilities to make such prepayment of the   Unsecured Bridge Loans.  From and after   the Conversion Date, each holder of Unsecured Bridge Loans may elect to   accept or waive a prepayment such holder is otherwise entitled to receive   pursuant to this paragraph.
    
	
 
    	
 
    	
 
    
	
Voluntary Prepayment:
    	
 
    	
Prior to the Conversion Date, the Unsecured   Bridge Loans may be prepaid, in whole or in part, at par plus accrued and   unpaid interest upon not less than five days’ prior written notice, at the   option of the Borrower at any time.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
From and after the Conversion Date, and   prior to the maturity thereof, Unsecured Bridge Loans may be prepaid, in   whole or in part, at the option of the Borrower, at any time (except as   provided below) upon five days’ prior written notice at par plus accrued   interest to the date of repayment plus the Applicable Premium. The “Applicable Premium” will be (A) with respect to the Ten   Year Bridge Loans, (i) a make-whole premium based on the applicable treasury   rate plus 50 basis points prior to the fifth anniversary of the Closing Date,   (ii) one-half of the then-prevailing interest rate on the Ten Year Bridge   Loans from and including the fifth anniversary of the Closing Date to and   including the sixth anniversary of the Closing Date and (iii) declining to   one-quarter of the then-prevailing interest rate on the Ten Year Bridge Loans   on the sixth anniversary of the Closing Date, to one-eighth of the   then-prevailing interest rate on the Ten Year Bridge Loans on the seventh   anniversary of the Closing Date and to zero on the eighth anniversary of the   Closing Date and (B) with respect to the Eight Year Bridge Loans, (i) a   make-whole premium based on the applicable treasury rate plus 50 basis points   prior to the third anniversary of the Closing Date, (ii) three-quarters of   the then-prevailing interest rate on the Eight Year Bridge Loans from and   including the third anniversary of the Closing Date to and including the   fourth anniversary of the Closing Date and (iii) declining to one-half of the   then-prevailing interest rate on the Eight Year Bridge Loans on the fourth   anniversary of the Closing Date, to one-quarter of the then-prevailing   interest rate on the Eight Year Bridge Loans on the fifth anniversary of the   Closing Date and to zero on the sixth anniversary of the Closing Date.
    
	
 
    	
 
    	
 
    
	
Unsecured Bridge Facility

Documentation:
    	
 
    	
The Facility Documentation for the Unsecured   Bridge Facility (the “Unsecured Bridge   Facility Documentation”) shall be negotiated in good faith within   a reasonable time period to be determined based on the expected Closing Date,   shall contain the terms and conditions set forth in this Annex C and, to   the extent not specified in this Annex C, such other terms as are customarily   found in high yield indentures as modified to reflect the operational and   strategic requirements of the Borrower and
    


 

Annex C - 5











 

	
 
    	
 
    	
its subsidiaries in light of their size,   industries, businesses and business practices, operations, financial   accounting and projections, with such customary changes to reflect the   interim nature of the Unsecured Bridge Facility (collectively, the “Unsecured Bridge Documentation Principles”). The Unsecured   Bridge Facility Documentation shall contain only those payments, conditions   to borrowing, mandatory prepayments, representations and warranties,   covenants and events of default expressly set forth in this Annex C, in   each case applicable to the Borrower and its restricted subsidiaries and with   standards, definitions, qualifications, thresholds, exceptions, “baskets” and   grace periods consistent with the Unsecured Bridge Documentation Principles; provided   that, except to the extent expressly provided in this Annex C, in no event   shall such terms be more restrictive than those contained in the Senior   Secured Facilities Documentation.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding the foregoing, the only   conditions to the availability of the Unsecured Bridge Facility on the   Closing Date shall be the applicable conditions set forth in the Commitment   Letter to which this term sheet is attached, the “Conditions Precedent to   Borrowing” section below and in Annex E to the Commitment Letter.
    
	
 
    	
 
    	
 
    
	
Representations and Warranties:
    	
 
    	
The Unsecured Bridge Facility Documentation   will contain representations and warranties which are usual and customary for   financings of this kind, substantially similar to those for the Senior   Secured Facilities and consistent with the Unsecured Bridge Documentation   Principles.
    
	
 
    	
 
    	
 
    
	
Covenants:
    	
 
    	
The Unsecured Bridge Facility Documentation   will contain the following covenants:    (a) customary affirmative covenants for financings of this kind,   consistent with the Unsecured Bridge Documentation Principles; (b) customary   incurrence-based negative covenants for financings of this kind consistent   with the Unsecured Bridge Documentation Principles; provided that   prior to the Conversion Date, the restricted payments and debt incurrence   covenants in the Unsecured Bridge Facility Documentation shall be more   restrictive; provided further that, prior to the Conversion Date, the   Unsecured Bridge Facility Documentation may be more restrictive than the   Senior Secured Facilities Documentation.    There will not be any financial maintenance covenants in the Unsecured   Bridge Facility Documentation.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Unsecured Bridge Facility Documentation   will contain a covenant requiring the Borrower to comply with the terms of   the Fee Letter, including any Take-out Notice (as defined in the Fee Letter)   and any cooperation required in connection therewith.
    


 

Annex C - 6











 

	
Events of Default:
    	
 
    	
Limited to nonpayment of principal, interest   or other amounts; violation of covenants; incorrectness of representations   and warranties in any material respect; cross acceleration to material   indebtedness; bankruptcy or insolvency of the Borrower or its significant   restricted subsidiaries; material monetary judgments; ERISA events; and   actual or asserted invalidity of material guarantees, consistent in each case   with the Unsecured Bridge Documentation Principles.
    
	
 
    	
 
    	
 
    
	
Conditions   Precedent to

Borrowing:
    	
 
    	
The several obligations of the Unsecured   Bridge Lenders to make, or cause one of their respective affiliates to make,   the Unsecured Bridge Loans will be subject solely to (i) the applicable   conditions referred to in the Commitment Letter and those set forth in   Annex E to the Commitment Letter, (ii) accuracy of representations and   warranties in all material respects (provided that any such   representations and warranties which are qualified by materiality, material   adverse effect or similar language shall be true and correct in all   respects), (iii) absence of defaults or events of default and (iv) delivery   of a customary borrowing notice.
    
	
 
    	
 
    	
 
    
	
Assignments and Participations:
    	
 
    	
The Unsecured Bridge Lenders will have the   right to assign Unsecured Bridge Loans after the Closing Date without the   consent of the Borrower; provided, however, that prior to the   date that is one year after the Closing Date and so long as a Demand Failure   Event has not occurred and no payment or bankruptcy event of default shall   have occurred and be continuing, the consent of the Borrower shall be   required with respect to any assignment (such consent not to be unreasonably   withheld or delayed) if, subsequent thereto, the Initial Lenders (together   with their affiliates) would hold, in the aggregate, less than 51% of the   outstanding Unsecured Bridge Loans.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Unsecured Bridge Lenders will have the   right to participate their Unsecured Bridge Loans, before or after the   Closing Date, to other financial institutions without restriction, other than   customary voting limitations. Participants will have the same benefits as the   selling Lenders would have with regard to yield protection and increased costs,   subject to customary limitations and restrictions.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Unsecured Bridge Facility Documentation   shall provide that Unsecured Bridge Loans may be purchased by the Borrower   and assigned on a non-pro rata basis through customary Dutch auction procedures   (so long as such purchases are offered to all Unsecured Bridge Lenders on a   pro rata basis in accordance with customary procedures to be agreed and   subject to customary restrictions to be agreed (including, without   limitation, (1) no default or event of default has occurred and is continuing   and (2)
    


 

Annex C - 7











 

	
 
    	
 
    	
such Dutch auctions shall be subject to   customary provisions regarding the treatment of material non-public   information with respect to the business of the Borrower and its   subsidiaries)); provided that any such Unsecured Bridge Loans acquired   by the Borrower or any of its subsidiaries shall be retired and cancelled   promptly upon acquisition thereof.
    
	
 
    	
 
    	
 
    
	
Voting:
    	
 
    	
Amendments and waivers of the Unsecured   Bridge Facility Documentation will require the approval of Lenders holding   more than 50% of the outstanding Unsecured Bridge Loans, except that (a) the   consent of each affected Lender will be required for (i) reductions of   principal, interest rates or the Applicable Margin, (ii) extensions of the   Maturity Date, (iii) additional restrictions on the right to exchange to   Exchange Notes or any amendment of the rate of such exchange, (iv) any   amendment to the Exchange Notes that requires (or would, if any Exchange   Notes were outstanding, require) the approval of all holders of Exchange   Notes and (v) subject to certain exceptions consistent with the Unsecured   Bridge Documentation Principles, releases of all or substantially all of the   value of the Guarantees (other than in connection with any release or sale of   the relevant Guarantor permitted by the Unsecured Bridge Facility   Documentation or Senior Secured Facilities Documentation), and (b) the   consent of 100% of the Unsecured Bridge Lenders will be required with respect   to modifications to any of the voting percentages.
    
	
 
    	
 
    	
 
    
	
Cost and Yield Protection:
    	
 
    	
The Unsecured Bridge Facility Documentation   will include customary tax gross-up, cost and yield protection provisions   substantially similar to those provisions for tax gross-up, cost and yield   protection in the Senior Secured Facilities Documentation.
    
	
 
    	
 
    	
 
    
	
Indemnities:
    	
 
    	
The Unsecured Bridge Facility Documentation   will provide customary and appropriate provisions relating to indemnity and   related matters in a form reasonably satisfactory to the Bridge Lead   Arrangers, the Bridge Administrative Agent and the Lenders.
    
	
 
    	
 
    	
 
    
	
Governing Law and Jurisdiction:
    	
 
    	
The Unsecured Bridge Facility Documentation   will provide that the Borrower will submit to the exclusive jurisdiction and   venue of the federal and state courts of the State of New York and will waive   any right to trial by jury.  New York   law will govern the Unsecured Bridge Facility Documentation.
    
	
 
    	
 
    	
 
    
	
Counsel   to the Bridge Lead
    	
 
    	
Cahill Gordon & Reindel LLP.
    
	
Arrangers   and the Bridge
    	
 
    	
 
    
	
Administrative Agent:
    	
 
    	
 
    


 

Annex C - 8











 

Exhibit 1 to Annex C

 

Summary of Unsecured Exchange Notes

 

This Summary of Exchange Notes outlines certain terms of the Exchange Notes referred to in Annex C to the Commitment Letter, of which this Exhibit 1 is a part.  Capitalized terms used herein have the meanings assigned to them in Annex C to the Commitment Letter.

 

Unsecured Exchange Notes

 

At any time on or after the first anniversary of the Closing Date, upon not less than five business days’ prior notice, Unsecured Bridge Loans may, at the option of a Lender, be exchanged for a principal amount of the applicable Unsecured Exchange Notes equal to 100% of the aggregate principal amount of the Unsecured Bridge Loans so exchanged.  At a Lender’s option, Unsecured Exchange Notes will be issued directly to its broker-dealer affiliate or other third party designated by it, upon surrender by the Lender to the Borrower of an equal principal amount of Unsecured Bridge Loans.  No Unsecured Exchange Notes will be issued until the Borrower receives requests to issue at least $100.0 million in aggregate principal amount of applicable type of Unsecured Exchange Notes.  The Borrower will issue Unsecured Exchange Notes under an indenture (the “Indenture”) that complies with the Trust Indenture Act of 1939, as amended.  The Borrower will appoint a trustee reasonably acceptable to the Lenders.

 

	
Final Maturity:
    	
 
    	
Eight Year Exchange Notes will mature on the   eighth anniversary of the Closing Date and Ten Year Exchange Notes will   mature on the tenth anniversary of the Closing Date.
    
	
 
    	
 
    	
 
    
	
Interest Rate:
    	
 
    	
Each Unsecured Exchange Note will bear   interest at a fixed rate equal to the applicable Total Cap then in effect   (plus default interest, if any).    Interest will be payable semiannually in arrears.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Additional default interest on all amounts   outstanding will accrue at the applicable rate plus two percentage points   (2.00%) per annum.
    
	
 
    	
 
    	
 
    
	
Optional Redemption:
    	
 
    	
The Unsecured Exchange Notes may be   redeemed, in whole or in part, at the option of the Borrower, at any time   (except as provided below) upon 3 days’ prior written notice at par plus   accrued interest to the date of repayment plus the Applicable Premium.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The “Applicable Premium”   will be (A) with respect to the Ten Year Exchange Notes (i) a make-whole   premium based on the applicable treasury rate plus 50 basis points prior to   the fifth anniversary of the Closing Date, (ii) one-half of the   applicable Total Cap from and including the fifth anniversary of the Closing   Date to and including the sixth anniversary of the Closing Date and (iii)   declining to one-quarter of the applicable Total Cap on the sixth anniversary   of the Closing Date, to one-eighth of the applicable Total Cap on the seventh   anniversary and to zero on the eighth anniversary of the Closing Date and (B)   with respect to the Eight Year Exchange Notes (i) a make-whole premium based   on the applicable treasury rate plus 50 basis points prior to
    


 

Annex C - 9











 

	
 
    	
 
    	
the third anniversary of the Closing Date,   (ii) three-quarters of the applicable Total Cap from and including the third   anniversary of the Closing Date to and including the fourth anniversary of   the Closing Date and (iii) declining to one-half of the applicable Total Cap   on the fourth anniversary of the Closing Date, to one-quarter of the   applicable Total Cap on the fifth anniversary of the Closing Date and to zero   on the sixth anniversary of the Closing Date.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
In addition, prior to the third anniversary   of the Closing Date, up to 35% of the original principal amount of the   Unsecured Exchange Notes may be redeemed from the proceeds of a qualifying   equity offering by the Borrower at a redemption price equal to par plus the   applicable Total Cap and accrued interest.
    
	
 
    	
 
    	
 
    
	
Defeasance   Provisions of
    	
 
    	
Customary.
    
	
Unsecured Exchange Notes:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Modification:
    	
 
    	
Customary.
    
	
 
    	
 
    	
 
    
	
Change of Control:
    	
 
    	
Customary at 101%.
    
	
 
    	
 
    	
 
    
	
Registration Rights:
    	
 
    	
None.
    
	
 
    	
 
    	
 
    
	
Covenants:
    	
 
    	
The Indenture will include covenants similar   to those contained in an indenture governing publicly traded high yield debt   securities; giving due regard to, among other things, then existing market   conditions.
    
	
 
    	
 
    	
 
    
	
Events of Default:
    	
 
    	
The Indenture will provide for Events of   Default similar to those contained in an indenture governing publicly traded   high yield debt securities giving due regard to, among other things, then   existing market conditions.
    


 

Annex C - 10











 

Annex D

 

Summary of the Secured Bridge Facility

 

This Summary outlines certain terms of the Secured Bridge Facility referred to in the Commitment Letter, of which this Annex D is a part.  Certain capitalized terms used herein are defined in the Commitment Letter.

 

	
Borrower:
    	
 
    	
The Borrower under the Senior Secured   Facilities (the “Borrower”).
    
	
 
    	
 
    	
 
    
	
Joint   Lead Arrangers and

Joint Bookrunners:
    	
 
    	
J.P. Morgan Securities LLC (“J.P. Morgan”) and Merrill Lynch, Pierce, Fenner &   Smith Incorporated (or any of its designated affiliates) (“Merrill Lynch”), in each case in its capacity as Joint   Lead Arranger and Joint Bookrunner  (together with any Additional   Arrangers appointed in accordance with Section 1 of the Commitment Letter,   collectively, the “Bridge Lead Arrangers”   or, the “Arrangers”).
    
	
 
    	
 
    	
 
    
	
Syndication Agent:
    	
 
    	
Merrill Lynch, in its capacity as   syndication agent (the “Syndication Agent”).
    
	
 
    	
 
    	
 
    
	
Bridge Administrative Agent:
    	
 
    	
JPMorgan Chase Bank, N.A. (“JPMCB”), in its capacity as administrative agent (the “Bridge Administrative Agent”).
    
	
 
    	
 
    	
 
    
	
Lenders:
    	
 
    	
JPMCB, Bank of America, N.A. (“Bank of America”) and/or other financial institutions   selected by the Bridge Lead Arrangers reasonably acceptable to the Borrower   (each, a “Secured Bridge Lender” and, collectively,   the “Secured Bridge Lenders” and together   with the “Bank Lenders” and the Unsecured   Bridge Lenders, the “Lenders”).
    
	
 
    	
 
    	
 
    
	
Amounts of Bridge Loans:
    	
 
    	
$1,000 million in aggregate principal amount   of senior secured increasing rate loans, less the amount of gross proceeds   from any sale of Secured Notes received on the Closing Date (the “Secured Bridge Loans”; together with the Unsecured Bridge   Loans, the “Bridge Loans”).
    
	
 
    	
 
    	
 
    
	
Availability:
    	
 
    	
The Secured Bridge Lenders will make the   Secured Bridge Loans on the Closing Date. Amounts borrowed under the Secured   Bridge Facility that are repaid or prepaid may not be reborrowed.
    
	
 
    	
 
    	
 
    
	
Use of Proceeds:
    	
 
    	
The proceeds of the Secured Bridge Loans   will be used by the Borrower on the Closing Date, together with the proceeds   of borrowings under the Senior Secured Facilities, the proceeds of the   borrowings under the Unsecured Bridge Facility, the proceeds from the   issuance of Notes, and cash on hand of the Borrower, to fund the Stock   Buy-Back.
    


 

Annex D - 1











 

	
Ranking:
    	
 
    	
The Secured Bridge Loans, the Guarantee and   all obligations with respect thereto will be senior obligations and rank pari passu in right of payment with all of the Borrower’s   and the Guarantors’ existing and future senior obligations (including the   obligations under the Senior Secured Facilities).
    
	
 
    	
 
    	
 
    
	
Guarantees:
    	
 
    	
All obligations of the Borrower under the   Secured Bridge Facility will be jointly and severally guaranteed by each   Guarantor (as defined in Exhibit B to the Commitment Letter), on a senior   basis (such guarantees, the “Bridge Guarantees”).   The Bridge Guarantees will automatically be released upon the release of the   corresponding guarantees of the Senior Secured Facilities. The Bridge   Guarantees will rank equal in right of payment with the guarantees of the   Senior Secured Facilities.
    
	
 
    	
 
    	
 
    
	
Security:
    	
 
    	
Secured by the same assets securing the   Senior Secured Facilities, on a first priority pari secured basis.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The relative rights and priorities of the   liens in the Collateral for the secured parties under (a) the Senior Secured   Facilities and (b) the Secured Bridge Loan will be set forth in the   Intercreditor Agreement.
    
	
 
    	
 
    	
 
    
	
Conversion into Rollover Loans:
    	
 
    	
If the Secured Bridge Loans have not been previously   prepaid in full for cash on or prior to the Conversion Date, the principal   amount of the Secured Bridge Loans outstanding on the Conversion Date may,   subject to no payment or bankruptcy event of default and the other conditions   precedent set forth in this Annex D, be converted into senior secured   rollover loans that will mature on the seventh anniversary of the Closing   Date (collectively, the “Secured Rollover Loans”).
    
	
 
    	
 
    	
 
    
	
Exchange into Exchange Notes:
    	
 
    	
At any time and from time to time, on or after   the Conversion Date, upon reasonable prior written notice and in a minimum   principal amount of at least $100.0 million, the Secured Rollover Loans   may be exchanged, in whole or in part, at the option of the applicable Lender   or Lenders, for senior exchange notes (the “Secured   Exchange Notes”, and together with the Unsecured Exchange Notes,   the “Exchange Notes”), in a principal   amount equal to the principal amount of the Secured Bridge Loans so exchanged   and having the same maturity date as the Secured Bridge Loans so   exchanged.  To the extent the Secured   Bridge Loans are exchanged, the Secured Exchange Notes will be secured on a   first priority pari secured basis by the same collateral securing the Senior   Secured Facilities.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Secured Exchange Notes will be issued   pursuant to an indenture (the “Indenture”)   that will have the terms set forth on Exhibit 1 to this Annex D.
    


 

Annex D - 2











 

	
Demand Failure Event:
    	
 
    	
Any failure to comply with the terms of a Securities   Demand (as defined in the Fee Letter) for any reason will be deemed to be a “Demand Failure Event” (as defined in the Fee Letter) under   the Secured Bridge Facility Documentation.
    
	
 
    	
 
    	
 
    
	
Interest Rate:
    	
 
    	
Until the earlier of (i) the first   anniversary of the Closing Date or (ii) the occurrence of a Demand Failure   Event (such earlier date, the “Conversion Date”),   the Secured Bridge Loans will bear interest at a floating rate, reset   quarterly, as follows:  (x) for   the first three-month period commencing on the Closing Date, the Secured   Bridge Loans will bear interest at a rate per annum equal to LIBOR (subject   to a floor of 0.75% per annum) plus 4.125%; provided that such   interest rate spread shall increase by 25 basis points per annum   if the Borrower shall have not received a public corporate credit rating of   at least BB by S&P and a public family rating of at least Ba2 by Moody’s   (in each case, with an outlook of stable or better) and (y) thereafter,   interest on the Secured Bridge Loans will be payable at a floating per annum rate equal to the interest rate applicable   during the prior three-month period, in each case plus the Bridge Spread,   reset at the beginning of each subsequent three-month period.  The “Bridge Spread”   will initially be 50 basis points (commencing three months after the Closing   Date) and will increase by an additional 50 basis points every three months   thereafter.  Notwithstanding the   foregoing, at no time will the per annum interest rate on the Secured Bridge   Loans exceed the applicable Total Cap (as defined in the Fee Letter) then in   effect (plus default interest, if any).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
From and after the Conversion Date, the   Secured Bridge Loans will bear interest at a fixed rate equal to the   applicable Total Cap (plus default interest, if any).
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Prior to the Conversion Date, interest will   be payable at the end of each interest period.  Accrued Interest shall also be payable in   arrears on the Conversion Date and on the date of any prepayment of the   Secured Bridge Loans.  From and after the   Conversion Date, interest will be payable quarterly in arrears and on the   date of any prepayment of the Secured Bridge Loans.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
After the occurrence and during the   continuance of an event of default, interest on all overdue amounts then   outstanding will accrue at a rate equal to the applicable rate set forth   above, plus an additional two percentage points (2.00%) per annum   and will be payable on demand.
    
	
 
    	
 
    	
 
    
	
Funding Protection:
    	
 
    	
Customary for transactions of this type,   including breakage costs, gross-up for withholding, compensation for   increased costs and compliance with capital adequacy and other regulatory   restrictions.
    


 

Annex D - 3












 

	
Mandatory Prepayment:
    	
 
    	
Prior to the Conversion Date, the net   proceeds to the Borrower, from (a) any direct or indirect public   offering or private placement of any debt or equity securities (other than   issuances pursuant to employee stock plans or any sale or disposition of   equity interests of Newco or the shares of the capital stock of the Company   acquired in the Stock Buy-Back), (b) any future bank borrowings (other   than pursuant to the Senior Secured Facilities and any refinancings or   replacements thereof) and (c) subject to certain ordinary course   exceptions and reinvestment rights, any future asset sales or other   dispositions of property (including casualty and condemnation events) by the   Borrower and its restricted subsidiaries, other than any sale or disposition   of equity interests of Newco or of the shares of the capital stock of the   Company acquired in the Stock Buy-Back, will be used to repay the Secured   Bridge Loans, in excess of amounts either reinvested or required to be paid   to the lenders under the Senior Secured Facilities.  Any proceeds from the issuance of Notes   purchased by a Lender or one or more of its affiliates will be applied,   first, to refinance the Secured Bridge Loans held at that time by such Lender,   and second, in accordance with the pro rata   provisions otherwise applicable to prepayments. Notwithstanding the   foregoing, mandatory prepayments under clause (c) above shall be limited to   the extent that the Borrower determines that such prepayments may either (i)   result in adverse tax consequences related to the repatriation of funds in   connection therewith by foreign subsidiaries or (ii) be prohibited or delayed   by applicable law.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Nothing in these mandatory prepayment   provisions will restrict or prevent any holder of Secured Bridge Loans from   exchanging Secured Bridge Loans for Secured Exchange Notes on or after the   Conversion Date.
    
	
 
    	
 
    	
 
    
	
Change of Control:
    	
 
    	
Upon the occurrence of a Change of Control   (to be defined),  the Borrower will be   required to prepay in full all outstanding Secured Bridge Loans at par plus   accrued interest to the date of prepayment plus with respect to any Secured   Bridge Loans so prepaid on or after the Conversion Date, a 1.0% prepayment   premium.  Prior to making any such   prepayment, the Borrower will, within 30 days of the Change of Control, repay   all obligations under the Senior Secured Facilities or obtain any required   consent of the lenders under the Senior Secured Facilities to make such   prepayment of the Secured Bridge Loans.    From and after the Conversion Date, each holder of Secured Bridge   Loans may elect to accept or waive a prepayment such holder is otherwise   entitled to receive pursuant to this paragraph.
    
	
 
    	
 
    	
 
    
	
Voluntary Prepayment:
    	
 
    	
Prior to the Conversion Date, the Secured   Bridge Loans may be prepaid, in whole or in part, at par plus accrued and   unpaid
    


 

Annex D - 4











 

	
 
    	
 
    	
interest upon not less than five days’ prior   written notice, at the option of the Borrower at any time.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
From and after the Conversion Date, and   prior to the maturity thereof, Secured Bridge Loans may be prepaid, in whole   or in part, at the option of the Borrower, at any time (except as provided   below) upon five days’ prior written notice at par plus accrued interest to   the date of repayment plus the Applicable Premium. The “Applicable   Premium” will be (i) a make-whole premium based on the applicable   treasury rate plus 50 basis points prior to the third anniversary of the   Closing Date, (ii) three-quarters of the then-prevailing interest rate on the   Secured Bridge Loans from and including the third anniversary of the Closing   Date to and including the fourth anniversary of the Closing Date and (iii)   declining to one-half of the then-prevailing interest rate on the Secured   Bridge Loans on the fourth anniversary of the Closing Date and to zero on the   fifth anniversary of the Closing Date.
    
	
 
    	
 
    	
 
    
	
Secured Bridge Facility

Documentation:
    	
 
    	
The Facility Documentation for the Secured   Bridge Facility (the “Secured Bridge Facility   Documentation”) shall be negotiated in good faith within a   reasonable time period to be determined based on the expected Closing Date,   shall contain the terms and conditions set forth in this Annex C and, to   the extent not specified in this Annex C, such other terms as are customarily   found in high yield indentures as modified to reflect the operational and   strategic requirements of the Borrower and its subsidiaries in light of their   size, industries, businesses and business practices, operations, financial   accounting and projections, with such customary changes to reflect the   interim nature of the Secured Bridge Facility (collectively, the “Secured Bridge Documentation Principles”). The Secured   Bridge Facility Documentation shall contain only those payments, conditions   to borrowing, mandatory prepayments, representations and warranties,   covenants and events of default expressly set forth in this Annex C, in   each case applicable to the Borrower and its restricted subsidiaries and with   standards, definitions, qualifications, thresholds, exceptions, “baskets” and   grace periods consistent with the Secured Bridge Documentation Principles; provided   that, except to the extent expressly provided in this Annex D, in no event   shall such terms be more restrictive than those contained in the Senior   Secured Facilities Documentation.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notwithstanding the foregoing, the only   conditions to the availability of the Secured Bridge Facility on the Closing   Date shall be the applicable conditions set forth in the Commitment Letter to   which this term sheet is attached, the “Conditions
    


 

Annex D - 5











 

	
 
    	
 
    	
Precedent to Borrowing” section below and in   Annex E to the Commitment Letter.
    
	
 
    	
 
    	
 
    
	
Representations and Warranties:
    	
 
    	
The Secured Bridge Facility Documentation   will contain representations and warranties which are usual and customary for   financings of this kind, substantially similar to those for the Senior   Secured Facilities and consistent with the Secured Bridge Documentation   Principles.
    
	
 
    	
 
    	
 
    
	
Covenants:
    	
 
    	
The Secured Bridge Facility Documentation   will contain the following covenants:    (a) customary affirmative covenants for financings of this kind,   consistent with the Secured Bridge Documentation Principles; (b) customary   incurrence-based negative covenants for financings of this kind consistent   with the Secured Bridge Documentation Principles; provided that prior   to the Conversion Date, the restricted payments and debt and lien incurrence   covenants in the Secured Bridge Facility Documentation shall be more   restrictive; provided further that, prior to the Conversion Date, the   Secured Bridge Facility Documentation may be more restrictive than the Senior   Secured Facilities Documentation.    There will not be any financial maintenance covenants in the Secured   Bridge Facility Documentation.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Secured Bridge Facility Documentation   will contain a covenant requiring the Borrower to comply with the terms of   the Fee Letter, including any Take-out Notice (as defined in the Fee Letter)   and any cooperation required in connection therewith.
    
	
 
    	
 
    	
 
    
	
Events of Default:
    	
 
    	
Limited to nonpayment of principal, interest   or other amounts; violation of covenants; incorrectness of representations   and warranties in any material respect; cross acceleration to material   indebtedness; bankruptcy or insolvency of the Borrower or its significant   restricted subsidiaries; material monetary judgments; ERISA events; and   actual or asserted invalidity of material guarantees, and actual or asserted   invalidity of material security documents or any security interest purported   to be created thereunder (including failure to be perfected on a   first-priority basis subject to certain customary exceptions), consistent in   each case with the Secured Bridge Documentation Principles.
    
	
 
    	
 
    	
 
    
	
Conditions   Precedent to

Borrowing:
    	
 
    	
The several obligations of the Secured   Bridge Lenders to make, or cause one of their respective affiliates to make,   the Secured Bridge Loans will be subject solely to (i) the applicable   conditions referred to in the Commitment Letter and those set forth in   Annex E to the Commitment Letter, (ii) accuracy of representations and   warranties in all material respects (provided that any such   representations and warranties which are qualified by materiality, material   adverse effect or similar language shall
    


 

Annex D - 6











 

	
 
    	
 
    	
be true and correct in all respects), (iii)   absence of defaults or events of default and (iv) delivery of a customary   borrowing notice.
    
	
 
    	
 
    	
 
    
	
Assignments and Participations:
    	
 
    	
The Secured Bridge Lenders will have the   right to assign Secured Bridge Loans after the Closing Date without the   consent of the Borrower; provided, however, that prior to the   date that is one year after the Closing Date and so long as a Demand Failure   Event has not occurred and no payment or bankruptcy event of default shall   have occurred and be continuing, the consent of the Borrower shall be   required with respect to any assignment (such consent not to be unreasonably   withheld or delayed) if, subsequent thereto, the Initial Lenders (together   with their affiliates) would hold, in the aggregate, less than 51% of the   outstanding Secured Bridge Loans.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Secured Bridge Lenders will have the   right to participate their Secured Bridge Loans, before or after the Closing   Date, to other financial institutions without restriction, other than   customary voting limitations. Participants will have the same benefits as the   selling Lenders would have with regard to yield protection and increased   costs, subject to customary limitations and restrictions.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Secured Bridge Facility Documentation   shall provide that Secured Bridge Loans may be purchased by the Borrower and   assigned on a non-pro rata basis through customary Dutch auction procedures   (so long as such purchases are offered to all Secured Bridge Lenders on a pro   rata basis in accordance with customary procedures to be agreed and subject   to customary restrictions to be agreed (including, without limitation, (1) no   default or event of default has occurred and is continuing and (2) such Dutch   auctions shall be subject to customary provisions regarding the treatment of   material non-public information with respect to the business of the Borrower   and its subsidiaries)); provided that any such Secured Bridge Loans   acquired by the Borrower or any of its subsidiaries shall be retired and   cancelled promptly upon acquisition thereof.
    
	
 
    	
 
    	
 
    
	
Voting:
    	
 
    	
Amendments and waivers of the Secured Bridge   Facility Documentation will require the approval of Lenders holding more than   50% of the outstanding Secured Bridge Loans, except that (a) the consent of   each affected Lender will be required for (i) reductions of principal,   interest rates or the Applicable Margin, (ii) extensions of the Maturity   Date, (iii) additional restrictions on the right to exchange to Exchange   Notes or any amendment of the rate of such exchange, (iv) any amendment to   the Exchange Notes that requires (or would, if any Exchange Notes were   outstanding, require) the approval of all holders of Exchange Notes and (v)   subject to certain exceptions consistent
    


 

Annex D - 7











 

	
 
    	
 
    	
with the Secured Bridge Documentation   Principles, releases of all or substantially all of the value of the   Guarantees (other than in connection with any release or sale of the relevant   Guarantor permitted by Secured the Bridge Facility Documentation or Senior   Secured Facilities Documentation) and release of liens on all or   substantially all of the Collateral, and (b) the consent of 100% of the Secured   Bridge Lenders will be required with respect to modifications to any of the   voting percentages.
    
	
 
    	
 
    	
 
    
	
Cost and Yield Protection:
    	
 
    	
The Secured Bridge Facility Documentation   will include customary tax gross-up, cost and yield protection provisions   substantially similar to those provisions for tax gross-up, cost and yield   protection in the Senior Secured Facilities Documentation.
    
	
 
    	
 
    	
 
    
	
Indemnities:
    	
 
    	
The Secured Bridge Facility Documentation   will provide customary and appropriate provisions relating to indemnity and   related matters in a form reasonably satisfactory to the Bridge Lead   Arrangers, the Bridge Administrative Agent and the Lenders.
    
	
 
    	
 
    	
 
    
	
Governing Law and Jurisdiction:
    	
 
    	
The Secured Bridge Facility Documentation   will provide that the Borrower will submit to the exclusive jurisdiction and   venue of the federal and state courts of the State of New York and will waive   any right to trial by jury.  New York   law will govern the Secured Bridge Facility Documentation.
    
	
 
    	
 
    	
 
    
	
Counsel   to the Bridge Lead
    	
 
    	
Cahill Gordon & Reindel LLP.
    
	
Arrangers   and the Bridge
    	
 
    	
 
    
	
Administrative Agent:
    	
 
    	
 
    


 

Annex D - 8











 

Exhibit 1 to Annex D

 

Summary of Secured Exchange Notes

 

This Summary of Exchange Notes outlines certain terms of the Exchange Notes referred to in Annex C to the Commitment Letter, of which this Exhibit 1 is a part.  Capitalized terms used herein have the meanings assigned to them in Annex C to the Commitment Letter.

 

Secured Exchange Notes

 

At any time on or after the first anniversary of the Closing Date, upon not less than five business days’ prior notice, Secured Bridge Loans may, at the option of a Lender, be exchanged for a principal amount of the applicable Secured Exchange Notes equal to 100% of the aggregate principal amount of the Secured Bridge Loans so exchanged.  At a Lender’s option, Secured Exchange Notes will be issued directly to its broker-dealer affiliate or other third party designated by it, upon surrender by the Lender to the Borrower of an equal principal amount of Secured Bridge Loans.  No Secured Exchange Notes will be issued until the Borrower receives requests to issue at least $100.0 million in aggregate principal amount of applicable type of Secured Exchange Notes.  The Borrower will issue Secured Exchange Notes under an indenture (the “Indenture”) that complies with the Trust Indenture Act of 1939, as amended.  The Borrower will appoint a trustee reasonably acceptable to the Lenders.

 

	
Final Maturity:
    	
 
    	
Secured Exchange Notes will mature on the seventh anniversary of the Closing Date.
    
	
 
    	
 
    	
 
    
	
Interest Rate:
    	
 
    	
Each Exchange Note will bear interest at a   fixed rate equal to the applicable Total Cap then in effect (plus default   interest, if any).  Interest will be   payable semiannually in arrears.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Additional default interest on all amounts   outstanding will accrue at the applicable rate plus two percentage points   (2.00%) per annum.
    
	
 
    	
 
    	
 
    
	
Optional Redemption:
    	
 
    	
The Secured Exchange Notes may be redeemed,   in whole or in part, at the option of the Borrower, at any time (except as   provided below) upon 5 days’ prior written notice at par plus accrued   interest to the date of repayment plus the Applicable Premium; provided   that notwithstanding the foregoing, the Borrower may redeem up to 10% of the   aggregate principal amount of the Secured Exchange Notes in any twelve-month   period on or before the third anniversary of the Closing Date at a price   equal to 103% of the aggregate principal amount thereof plus any accrued and   unpaid interest thereon.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The “Applicable Premium”   will be (i) a make-whole premium based on the applicable treasury rate plus   50 basis points prior to the third anniversary of the Closing Date, (ii)   three-fourths of the applicable Total Cap from and including the third   anniversary of the Closing Date to and including the fourth anniversary of   the Closing date and (iii) declining to one-half of the applicable Total Cap   on the fourth anniversary of the Closing Date and to zero on the fifth   anniversary of the Closing Date.
    


 

Annex D - 9











 

	
 
    	
 
    	
In addition, prior to the third anniversary   of the Closing Date, up to 35% of the original principal amount of the   Secured Exchange Notes may be redeemed from the proceeds of a qualifying   equity offering by the Borrower at a redemption price equal to par plus the   applicable Total Cap and accrued interest.
    
	
 
    	
 
    	
 
    
	
Defeasance   Provisions of
    	
 
    	
Customary.
    
	
Exchange Notes:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Modification:
    	
 
    	
Customary.
    
	
 
    	
 
    	
 
    
	
Change of Control:
    	
 
    	
Customary at 101%.
    
	
 
    	
 
    	
 
    
	
Registration Rights:
    	
 
    	
None.
    
	
 
    	
 
    	
 
    
	
Covenants:
    	
 
    	
The Indenture will include covenants similar   to those contained in an indenture governing publicly traded high yield debt   securities; giving due regard to, among other things, then existing market   conditions.
    
	
 
    	
 
    	
 
    
	
Events of Default:
    	
 
    	
The Indenture will provide for Events of   Default similar to those contained in an indenture governing publicly traded   high yield debt securities giving due regard to, among other things, then   existing market conditions.
    


 

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Annex E

 

Conditions Precedent to the Facilities

 

This Annex E sets forth the conditions precedent to each of the Facilities referred to in the Commitment Letter, of which this Annex E is a part.  Certain capitalized terms used herein are defined in the Commitment Letter.

 

The conditions to and the initial funding under each of the Facilities shall consist only of the following (together with any other conditions to funding expressly set forth in Section 2 of the Commitment Letter):

 

1.                                      The terms of the Purchase Agreement will be reasonably satisfactory to the Arrangers; provided that the Arrangers acknowledge that the Purchase Agreement dated as of July 25, 2013 is reasonably satisfactory to the Arrangers.  No conditions precedent to the consummation of the Stock Buy-Back or other provision in the Purchase Agreement dated as of July 25, 2013 shall have been waived, modified, supplemented or amended (and no consent granted), in a manner materially adverse to the Arrangers or the Lenders in their capacities as Lenders, in each case without the consent of the Arrangers, not to be unreasonably withheld or delayed (it being understood and agreed that any increase or reduction in the purchase price shall not be deemed to be materially adverse to the Lenders; provided that (i) any increase in the purchase price shall be funded solely by Domestic Cash and (ii) any reduction shall be allocated to ratably reduce the Domestic Cash, the Bridge Facilities (and, if applicable, the Notes) and the Senior Secured Facilities in proportion to the actual percentages that the amount of Domestic Cash, the Bridge Facilities (and, if applicable, the Notes) and the Senior Secured Facilities bear to the pro forma total capitalization of the Company and its subsidiaries after giving effect to the Stock Buy-Back).

 

2.                                      The Arrangers shall have received (i) audited financial statements of the Company for each of the three fiscal years immediately preceding the initial funding ended more than 90 days prior to the Closing Date; and (ii) unaudited financial statements of the Company for any fiscal quarter ended after the date of the most recent audited financial statements of such person and more than 45 days prior to the Closing Date.

 

3.                                      To the extent invoiced at least three (3) business days prior to the Closing Date (or such later date as the Company may reasonably agree), all costs, fees, expenses (including, without limitation, reasonable and invoiced (at least two business days prior to the Closing Date) out-of-pocket legal fees and expenses) and other compensation required by the Commitment Letter and the Fee Letter to be paid to the Commitment Parties, the Arrangers, the Administrative Agent or the Lenders on the Closing Date shall have been paid to the extent due.

 

4.                                      Subject in all respects to Section 2 of the Commitment Letter, the Company shall have complied with the following closing conditions and delivered the following customary documentation relating to the Borrower and  the Guarantors:  (i) the delivery of customary legal opinions, corporate records and documents from public officials, lien searches and officer’s certificates; (ii) evidence of authority; and (iii) delivery of a solvency certificate in the form attached as Annex F from the chief financial officer of the Borrower, as to the Borrower and the Subsidiaries on a consolidated basis.

 

5.                                      The Arrangers will have received at least 5 days prior to the Closing Date all documentation and other information required by bank regulatory authorities under applicable “know-your-

 

Annex E - 1











 

customer” and anti-money laundering rules and regulations, including the Patriot Act, to the extent requested at least 10 days prior to the Closing Date.

 

6.                                      With respect to each of the Bridge Facilities, the Arrangers and the Investment Banks each shall have received no later than 15 consecutive business days prior to the Closing Date a customary offering memorandum containing all customary information, including financial statements, pro forma financial statements, business and other financial data of the type required in a registered offering of debt securities by Regulation S-X and Regulation S-K under the Securities Act (other than Rules 3-10 and 3-16 of Regulation S-X and subject to exceptions customary for private placements pursuant to Rule 144A promulgated under the Securities Act) or that would be necessary for the Investment Bank to receive customary (for high yield debt securities) “comfort” (including “negative assurance” comfort) from independent accountants in connection with the offering of the Notes, and, in the case of the annual financial statements, the appropriate auditors’ reports thereon, and concurrently with the time period provided for above, the Investment Bank shall have had a period of at least 15 consecutive business days following delivery of the offering memorandum to market the Notes (provided that if such period has not ended prior to August 19, 2013, such period shall be deemed not to have commenced until September 3, 2013 (the “Black Out Dates”)). The Company shall have caused their independent registered public accountants to render customary “comfort letters” (including customary “negative assurances”) with respect to the financial information in such offering memorandum.  With respect to the Senior Secured Facilities, the Bank Lead Arrangers will have been afforded a period of at least 15 consecutive business days (subject to the Black Out Dates) following delivery of the Confidential Information Memorandum to them.

 

7.                                      Subject in all respects to the Funding Conditions Provisions, (a) the Guarantees shall have been executed and be in full force and effect or substantially simultaneously with the initial borrowing under the Senior Secured Facilities, shall be executed and become in full force and effect, (b) with respect to the Senior Secured Facilities, all documents and instruments required to perfect the Bank Administrative Agent’s and Bridge Administrative Agent’s (as to any Secured Bridge Loans) security interest in the Collateral shall have been executed and delivered by each Credit Party party thereto and, if applicable, be in proper form for filing, and none of the Collateral shall be subject to any other pledges, security interest or mortgages, except for the liens permitted under the Senior Secured Facilities Documentation, (c) the Bridge Guarantees shall have been executed and be in full force and effect or substantially simultaneously with the initial borrowing under the Bridge Loans, shall be executed and become in full force and effect and  (d) with respect to the Secured Bridge Loans, all documents and instruments required to create and perfect the Bridge Administrative Agent’s security interest in the Collateral shall have been executed and delivered by the Borrower and each Guarantor under the Secured Bridge Loans party thereto and, if applicable, be in proper form for filing, and none of the Collateral shall be subject to any other pledges, security interest or mortgages, except for the liens permitted under the Bridge Facility Documentation.

 

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Annex F

 

[FORM OF] SOLVENCY CERTIFICATE

 

[                      ], 2013

 

The undersigned, [                      ], the Chief Financial Officer of Activision Blizzard, Inc. (“Borrower”), is familiar with the properties, businesses, assets and liabilities of the Borrower and its subsidiaries and is duly authorized to execute this certificate (this “Solvency Certificate”) on behalf of the Borrower.

 

This Solvency Certificate is delivered pursuant to Section [    ] of the Credit Agreement dated as of [          ], 2013 (the “Credit Agreement”; terms defined therein unless otherwise defined herein being used herein as therein defined) among the Borrower, each Lender from time to time party thereto, Bank of America, N.A. (“Bank of America”), and the other agents named therein.

 

  As used herein, “Company” means the Borrower and its subsidiaries on a consolidated basis.

 

1.             The undersigned certifies, on behalf of the Borrower and not in his individual capacity, that he has made such investigation and inquiries as to the financial condition of the Borrower and its subsidiaries as the undersigned deems necessary and prudent for the purposes of providing this Solvency Certificate.  The undersigned acknowledges that the Administrative Agent and the Lenders are relying on the truth and accuracy of this Solvency Certificate in connection with the making of Loans under the Credit Agreement.

 

2.             The undersigned certifies, on behalf of the Borrower and not in his individual capacity, that (a) the financial information, projections and assumptions which underlie and form the basis for the representations made in this Solvency Certificate were made in good faith and were based on assumptions reasonably believed by the Borrower to be fair in light of the circumstances existing at the time made; and (b) for purposes of providing this Solvency Certificate, the amount of contingent liabilities has been computed as the amount that, in the light of all the facts and circumstances existing as of the date hereof, represents the amount that can reasonably be expected to become an actual or matured liability.

 

BASED ON THE FOREGOING, the undersigned certifies, on behalf of the Borrower and not in his individual capacity, that, on the date hereof, before and after giving effect to the Transactions (and the Loans made or to be made and other obligations incurred or to be incurred on the Closing Date):

 

(i)            the fair value of the property of the Company is greater than the total amount of liabilities, including contingent liabilities, of the Company;

 

(ii)           the present fair salable value of the assets of the Company is greater than the amount that will be required to pay the probable liability of the Company on the sum of its debts and other liabilities, including contingent liabilities;

 

(iii)          the Company has not, does not intend to, and does not believe (nor should it reasonably believe) that it will, incur debts or liabilities beyond the Company’s ability to pay such debts and liabilities as they become due (whether at maturity or otherwise);

 

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(iv)          the Company does not have unreasonably small capital with which to conduct the businesses in which it is engaged as such businesses are now conducted (and reflected in the Projections) and are proposed to be conducted following the Closing Date; and

 

(v)           the Company is “solvent” within the meaning given to that term and similar terms under the Bankruptcy Code and applicable laws relating to fraudulent transfers and conveyances.

 

IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate as of the first date written above, solely in his capacity as the Chief Financial Officer of the Borrower and not in his individual capacity.

 

	
 
    	
Name:
    	
 
    
	
 
    	
 
    
	
Title:     Chief Financial Officer
    	
 
    


 

Annex F - 2