Document:

Exhibit 10.2

 

TAX SHARING AGREEMENT

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

2

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

4

 

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

 

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

 

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

 

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

 

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

 

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

 

2.                         Vivendi
Group Tax Returns.

 

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

 

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

 

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

 

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

 

2.4           Adjustments.

 

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

 

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

 

6

 

2.5           Timing of Payments.

 

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

 

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

 

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

 

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

 

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

 

5.                         Indemnification.

 

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

 

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

 

7

 

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

 

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

 

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

 

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

 

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

 

8

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

9

 

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

 

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

 

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

 

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

 

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

 

to Vivendi:

 

[local
address]

 

10

 

to Vivendi
Games:

 

[local
address]

 

to Activision
Blizzard:

 

[local
address]

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

11

 

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

 

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

 

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

 

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

 

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

 

12

 

	
   

  	
  Vivendi Holding I Corp.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E. Bushnell III

  
	
   

  	
   

  	
  Name:

  	
  George E. Bushnell III

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date: 
  July 9, 2008

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Vivendi Games, Inc.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce L. Hack

  
	
   

  	
   

  	
  Name:

  	
  Bruce L. Hack

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date: 
  July 9, 2008

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Activision Blizzard, Inc.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert. A. Kotick

  
	
   

  	
   

  	
  Name:

  	
  Robert A.
  Kotick

  
	
   

  	
   

  	
  Title:

  	
  President and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date:  July 9, 2008

  
					

 

13

 

APPENDIX A

 

[Non-US
Subsidiary Cash]

 

14Exhibit 10.1

 

SETTLEMENT AGREEMENT

 

This Settlement Agreement, dated as of July 10,
2008 (“Agreement”),  is
by and between Team Financial, Inc., a Kansas corporation (the “Company”), and Keith B.
Edquist (“Mr. Edquist”).

 

WHEREAS, the
Company and Mr. Edquist have been engaged in a proxy contest in respect of
the election of Class III directors to the Board of Directors to the
Company to be elected at the
Company’s 2008 Annual Meeting of Shareholders (the  “2008 Annual Meeting”); and

 

WHEREAS, the
Company and other shareholders of the Company known as the “Bicknell Group”
have entered into an agreement dated as of June 16, 2008 (the “Bicknell Group Agreement”), which
among other things, provides that the Company will nominate a revised slate of
nominees for Class III directors to be elected at the 2008 Annual Meeting;
and

 

WHEREAS, the
Company and Mr. Edquist (each a “Party”) desire
to enter into this Agreement which will, among other things, terminate the
pending proxy contest between the Parties for the election of directors at the
2008 Annual Meeting and provide for certain other agreements and covenants of
the Parties.

 

NOW, THEREFORE, in
consideration of the foregoing premises and the mutual covenants and agreements
contained herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties hereto, intending
to be legally bound hereby, agree as follows:

 

ARTICLE I

 

DEFINITIONS
AND CONSTRUCTION

 

Section 1.1             Certain Definitions.  As used in this Agreement, the following
terms will have the meanings specified below:

 

“Affiliate”  has the
meaning set forth in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act.

 

“Applicable
Law” means all
applicable provisions of all (a) constitutions, treaties, statutes, laws
(including common law), rules, regulations, ordinances or codes of any
governmental authority, and (b) orders, decisions, injunctions, judgments,
awards and decrees of any governmental authority.

 

“Associate”  has the meaning ascribed to such term in Rule 12b-2
of the General Rules and Regulations of the Exchange Act.

 

“Business
Day” means a day
other than a Saturday, a Sunday, a day on which banking institutions in the
State of Kansas are authorized or obligated by law or required by executive
order to be closed, or a day on which The NASDAQ Global Market is closed.

 

“Common
Stock” means the
common stock of the Company, no par value per share.

 

“Exchange
Act”  means the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder.

 

1

 

“Person”
means an individual, a partnership, an association,
a joint venture, a corporation, a limited liability company, a business, a
trust, any entity organized under Applicable Law, an unincorporated
organization or any governmental authority.

 

“SEC”  means the U.S. 
Securities and Exchange Commission.

 

“Voting
Securities” means
the Common Stock and any other securities of the Company having the right to
Vote.

 

Section 1.2             Interpretation and Construction
of the Agreement.  The definitions in
Section 1.1 herein will apply equally to both the singular and plural
forms of the terms defined.  Whenever the
context may require, any pronoun will include the corresponding masculine, feminine and neuter forms. 
The word “include” will be deemed to be followed by the phrase “without limitation.” All references herein to Articles,
Sections and Exhibits will be deemed to be
references to Articles and Sections of, and Exhibits to, this Agreement unless the context will otherwise require.  The headings of the Articles and Sections are
inserted for convenience of reference only and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.  Unless the context will otherwise require or
provide, any reference to any agreement or other instrument or statute or
regulation is to such agreement, instrument, statute or regulation as amended
and supplemented from time to time (and, in the case of a statute or regulation,
to any successor provision).

 

ARTICLE II

 

REPRESENTATIONS AND  WARRANTIES

 

Section 2.1             Representations and Warranties
of the Company.  The Company
represents and warrants to Mr. Edquist that (a) this Agreement has
been duly authorized, executed and delivered by the Company, and is a valid and
binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforcement thereof may be limited by
applicable banking, bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or similar laws generally affecting the rights of creditors and
subject to general equity principles; (b) neither the execution of this
Agreement nor the consummation of any of the transactions contemplated hereby
nor the fulfillment of the terms hereof, in each case in accordance with the
terms hereof, will conflict with, result in a breach or violation or imposition
of any lien, charge or encumbrance upon any property or assets of the Company
or any of its subsidiaries pursuant to the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition, covenant or instrument to which the Company or any of its subsidiaries is a party
or bound or to which its or their property is subject; and (c) the
Bicknell Group Agreement, in the form attached to the Company’s Current Report
on Form 8-K, as filed with the SEC on June 17, 2008, is
presently in full force and effect, has not been modified or amended since June 16, 2008,
and neither the Company nor to the Company’s knowledge, the Bicknell Group, is
in default under any provision of the Bicknell Group Agreement, nor has any
event which with the giving of notice or lapse of time, or both, would
constitute 

 

2

 

an event of default under the
terms of the Bicknell Group Agreement, occurred or is continuing.

 

Section 2.2             Representations and Warranties
of Mr. Edquist.  Mr. Edquist
represents and warrants to the Company that this Agreement has
been duly authorized, executed and  delivered by him, and is a valid and binding obligation of him,
enforceable against him in accordance with its
terms, except as enforcement thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or similar laws
generally affecting the rights of creditors and subject to general equity
principles.

 

ARTICLE III

 

2008 ANNUAL MEETING MATTERS

 

Section 3.1             Acknowledgments.  Each Party acknowledges the following:

 

(a)           Mr. Edquist has
been informed by the Company of the matters set forth in this Article III
and is basing his acknowledgment solely on the Bicknell Group Agreement and the
Company’s Current Report on Form 8-K filed with the SEC on June 17, 2008.

 

(b)           Denis Kurtenbach and
Carolyn Jacobs have informed the Company that they will not stand for election
at the 2008 Annual Meeting.  The
Nominating Committee of the Board of Directors of the Company (the “Nominating Committee”) has nominated Jeffrey L.  Renner and Richard J. Tremblay to fill the
Company’s slate of Class III director nominees for the 2008 Annual
Meeting, subject to (i) receipt of their respective written acknowledgment
of their respective willingness to serve as nominees of the Board of Directors
of the Company (the “Board”)  and
to serve as a director if elected, and (ii) any necessary non-objection to
their election by the Board of Governors of the Federal Reserve System (“Federal
Reserve Board”).  If either of these Class III
nominees decline to stand for nomination to the Board, then, the Nominating
Committee will propose different nominees (i) who possess business
experience in such areas as would reasonably be expected to enhance the Board (ii) who
will qualify as “independent”
under the listing standards of The Nasdaq Stock Market, Inc. (Marketplace  Rule 4200
and any successor thereto) and Item 407(a) of Regulation S-K promulgated
by the SEC, and (iii) who do not
have a relationship with Mr. Edquist, the Company or any of the Company’s
executive officers that would impair the independence of such director in
carrying out the responsibilities of a director of the Company.

 

(c)           Harold
G. Sevy, Jr., director, has agreed to tender his resignation as a director, effective not later than the 2008 Annual
Meeting and the Board of Directors
will concurrently amend and restate the Bylaws to fix the size of the board at
eight directors.

 

(d)           The
Company shall include the foregoing nominees for election as Class III
directors of the Company at the 2008 Annual Meeting with such persons to serve,
if elected, until their successors have been duly elected and qualified.

 

Section 3.2             Voting of Mr. Edquist’s Shares of Common Stock.  Mr. Edquist will vote all shares of
Common Stock he is entitled to vote in favor of the Company’s slate of nominees
for election as Class III directors of the Company at the 2008 Annual
Meeting by person or by proxy,
and any postponement or adjournment thereof, and not in favor of any other nominees to serve on the Board, provided
such slate consists of the director nominees selected above, i.e.,
Robert Blachly, Richard Tremblay and Jeffrey L. Renner; and
provided further that the Bicknell Group Agreement remains in effect without
modification in any material respect and provided that neither the Company nor
the Bicknell Group shall be in violation in any material respect of the terms
of the Bicknell Group Agreement.  Mr. Edquist
will not take any position, make any statements, written or oral, or take any
action inconsistent with the foregoing.  

 

3

 

Mr. Edquist will ensure that he will be
present, in person or by proxy, and will cause his Affiliates and Associates owning Common Stock to be
present, in each case, in person or by
proxy, at the 2008 Annual Meeting so that all Common Stock beneficially owned
by Mr. Edquist and his Affiliates
and Associates will be counted for purposes of determining the presence of a quorum at the 2008 Annual
Meeting.

 

ARTICLE
IV

 

COVENANTS

 

Section 4.1             Mr. Edquist’s
Covenants.

 

(a)           Mr. Edquist agrees to (i) terminate
immediately any and all activities relating to the aforementioned proxy contest
and to use his best efforts to cause Lloyd Byerhof to terminate any and all activities relating to the
aforementioned proxy contest, and (ii) that during the period beginning on the date hereof and ending immediately
following the earlier of June 30, 2010 or the 2010 Annual Meeting of
Shareholders of the Company, and on condition that the Bicknell Group Agreement
remains in effect without modification in any material respect and on condition
that neither the Company nor the Bicknell Group shall be in violation in any
material respect of the Bicknell Group Agreement except as otherwise
specifically provided herein, he will not, and he will cause each of his
Affiliates and Associates and he will use his best efforts to cause
Lloyd Byerhof not to, directly or indirectly, alone or in concert with
others, take any of the actions set forth below:

 

i.              effect, seek,
offer, propose (whether publicly or otherwise) or cause or participate in, or
assist, encourage or seek to persuade, any other person to effect, seek, offer
or propose (whether publicly or otherwise) or participate in:

 

a.                                       any tender offer or exchange offer involving Common Stock;  provided,
however, that this clause (i) will be inoperative to the extent a third party
which is not an Affiliate or Associate of Mr. Edquist commences a hostile
tender offer or exchange offer with respect to Common Stock or (ii) the
Board of Directors of the Company is recommending or otherwise supporting a
tender offer or exchange offer by a third party that is not an Affiliate or
Associate of Mr. Edquist;

 

b.                                      any merger, consolidation, share exchange, business
combination, sale of assets, recapitalization, restructuring, dividend,
distribution, self tender, stock repurchase, liquidation, dissolution or other
extraordinary transaction with or involving the Company or any of its subsidiaries or any portion of the business or the assets of the Company or any
of its subsidiaries; provided, however, that
(i) if the Company commences a process to complete any of the activities
of the Company set forth in this subsection (b), or (ii) the Board of
Directors has determined to enter into an agreement with respect to any of the
activities set forth in this subsection (b), then Mr. Edquist will have
the opportunity (x) to participate in such process under the same
procedures and guidelines established for the other participants in the process or (y) propose a similar type of transaction, respectively; or

 

c.                                       any “solicitation” of “proxies” (as such terms are
used in the proxy rules of the SEC) with respect to the Company or any 

 

4

 

action resulting in such person becoming a “participant” in any “election
contest” (as such terms are used in the proxy rules of the SEC) with
respect to the Company.

 

ii.          propose any matter for submission to a
vote of shareholders of the Company;

 

iii.         grant any proxy or rights with respect
to any Common Stock to any person not designated by the Company;

 

iv.        execute any written consent, waiver or
demand with respect to any Common Stock, including any demand to inspect books
and records of the Company;

 

v.         call or seek to have called any meeting of the holders of
the Common Stock;

 

vi.        initiate or seek to initiate any
solicitation of the holders of Common Stock;

 

vii.       take any action to seek to amend any
provision of the Articles of Incorporation or the Bylaws of the Company;

 

viii.      take any action that could reasonably be
expected to force the Company to make any public disclosure with respect to any
of the types of matters described in clauses (i) through (vii), or
announce any intention to take any action of the type described in clauses (i) through
(vii); or

 

ix.         enter into any discussions,
negotiations, arrangements or understandings with any person other than the
Company with respect to any of the foregoing, or advise, assist, encourage or
seek to persuade others to take any action with respect to any of the
foregoing.

 

(b)             Simultaneous with the execution of
this Agreement Mr. Edquist will return to the Company (i) all copies
of shareholder lists of the Company received by Mr. Edquist in connection
with the 2008 Annual Meeting, and all copies of lists of employees of the Company, lists of Company ESOP
participants and the like, if any,
including computer discs and other electronic copies, and similar information
in his possession and in the possession of his agents and Lloyd Byerhof, and (ii) destroy
any and all of such records as may be in his possession or in the possession of
his agents and Mr. Byerhof.  Within
five (5) days of the date of this Agreement Mr. Edquist shall provide
the Company with a notarized certificate that provides that Mr. Edquist
has complied with this Section 4.1(b) and has urged Mr. Byerhof
to comply with this Section 4.1(b).

 

Section 4.2  The
Company’s Covenants.  Simultaneous
with the execution of this Agreement, the Company shall tender Mr. Edquist
the sum of $22,572 in immediately available funds.  The Company shall make additional payments to
Mr. Edquist as follows:

 

5

 

	
  Date

  	
   

  	
  Amount of Payment

  	
   

  
	
  August 1, 2008

  	
   

  	
  $

  	
  22,572

  	
   

  
	
  September 1, 2008

  	
   

  	
  $

  	
  22,572

  	
   

  
	
  October 1, 2008

  	
   

  	
  $

  	
  22,572

  	
   

  
	
  November 1, 2008

  	
   

  	
  $

  	
  22,572

  	
   

  
	
  December 1, 2008

  	
   

  	
  $

  	
  22,572

  	
   

  
	
  January 1, 2009

  	
   

  	
  $

  	
  22,572

  	
   

  

 

In addition the Company shall pay to Mr. Edquist on each payment
date commencing on August 1, 2008, interest accrued on the unpaid balance,
from the date hereof, at a rate equal to the Prime Rate as published in the Wall
Street Journal on each payment date, such rate to be effective
prospectively.  The initial rate shall be
5% per annum.

 

These amounts are reimbursement by the Company to Mr. Edquist of
his reasonable expenses incurred after receipt by the Company of reasonably
satisfactory documentation thereof by him, including expenses relating to the
nomination and election of directors of the Company, the solicitation of
proxies, and acts and filings in connection there with and the negotiation and
execution of this Agreement, provided such reimbursement shall not exceed the
sum of all of the payments above, and Mr. Edquist hereby agrees that such
payments shall be in full satisfaction of any claims or rights he may have for
fees, expenses or costs related to his activities in respect of the 2008 Annual
Meeting and the proxy contest terminated by execution of this Agreement.

 

ARTICLE
V

 

Section 5.1             Covenant Not To Sue.        Except as set forth in Sections 6.3 and 6.4, Mr. Edquist
and each of his Affiliates and Associates, on one hand, and the Company, and
each of its Affiliates and Associates, on the other hand, agrees not to sue or
otherwise commence or continue in any manner, directly or indirectly, any suit,
claim, action, right or course of action relating to any acts or omissions in
connection with the 2008 Annual Meeting through the date hereof, including, the
nomination or election of directors, the solicitation of proxies or any acts or
filings in connection therewith through the date hereof; provided, however,
that no party hereto shall be prohibited from enforcing its rights under and
pursuant to this Agreement.

 

Section 5.2             Releases.

 

(a)           Except as set forth in Sections 6.3
and 6.4, the Company, on behalf of itself, its directors, officers, employees,
representatives and agents (collectively, the “Company
Releasors”), does hereby, fully and forever, release and discharge Mr. Edquist
and his attorneys, representatives and agents (collectively, the “Edquist Releasees”) from any and all actions, claims,
complaints, rights or causes of action, debts, demands or suits of any kind or
nature whatsoever, statutory, equitable or legal, foreseen or unforeseen, known
or unknown, matured or unmatured that the Company Releasors have, may have or
might claim to have against the Edquist Releasees through the date hereof
excluding any claims arising out of banking or lending relationships Mr. Edquist
may have with the Company and its Affiliates.

 

(b)           Except
as set forth in Section 6.3 and 6.4, Mr. Edquist, on behalf of
himself, his employees, representatives and agents (collectively, the “Edquist Releasors”), does hereby, fully and forever, release
and discharge the Company, its directors, officers, employees, attorneys,
representatives and agents (collectively, the “Company
Releasees”) from any and all actions, claims, complaints, rights or
causes of action, debts, demands or suits of any kind or nature whatsoever,
statutory, equitable or legal, foreseen or unforeseen, known or unknown,
matured or unmatured that the Edquist Releasors have, may have or might claim
to have against the Company Releasees through the date hereof excluding any
claims arising out of banking or lending relationships Mr. Edquist may have
with the Company and its Affiliates.  Provided
however, that in the event that the Company is in material breach of any of
the terms of this Agreement, and such material breach is not cured within
thirty (30) days after written notice thereof is given to the Company by Mr. Edquist,
then in addition to any other remedies Mr. Edquist may have under law or
this Agreement, the provisions of Sections 4.1 and 6.2 (insofar as Section 6.2
applies to Mr. Edquist) shall terminate.

 

6

 

ARTICLE VI

 

OTHER MATTERS

 

Section 6.1             Joint Press Release.  Promptly after the execution of this
Agreement, the Company and Mr. Edquist shall issue a joint press release
in the form attached to this Agreement as Exhibit A.

 

Section 6.2             Non-disparagement.  During the term of this Agreement, neither
the Company, Mr. Edquist nor their Affiliates or Associates, nor any of
their respective partners, members, directors, officers, employees or agents,
will publicly disparage any other party to this Agreement nor any of their
respective partners, members, directors, officers, employees or agents.  Any breach of the obligations under this Section 6.2
shall be considered material and thereafter the breaching Party shall not be
entitled to any further benefits of this Agreement, including any future
payments after the breach.  The foregoing
provision will be in addition to any other remedies that the non-breaching
Party may have.

 

Section 6.3             Specific Performance.  Mr. Edquist, on the one hand, and the
Company, on the other hand, acknowledges and agrees that irreparable injury to
the other Party hereto would occur in the event any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached and that such injury would not be adequately compensable in
damages.  It is accordingly agreed that Mr. Edquist,
on the one hand, and the Company, on the other hand (the “Moving Party”),  shall
each be entitled to specific enforcement of, and injunctive relief to prevent any violation of, the terms hereof and the other party hereto will not
take action, directly or indirectly, in opposition to the Moving Party seeking
such relief on the grounds that any other remedy or relief is available at law
or in equity.

 

Section 6.4             Jurisdiction; Applicable Law.  Each of the parties hereto (a) consents
to submit itself to the personal jurisdiction of the federal or state courts of
the State of Kansas in the event any dispute arises out of this Agreement or
the transactions contemplated by this Agreement, (b) agrees that it shall
not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court, (c) agrees
that it shall not bring any action relating to this Agreement or the transactions  contemplated by this Agreement in any court other
than the federal or state courts of the State
of Kansas, and each of the parties irrevocably waives the right to trial by
jury, (d) agrees to waive any bonding
requirement under any applicable law, in the case any other party seeks to enforce the terms by way of equitable relief and (e) each
of the parties irrevocably consents to service of process by first class
certified mail, return receipt requested,
postage prepaid, to the address of such party’s principal place of business or
as otherwise provided by applicable law.  THIS AGREEMENT SHALL BE GOVERNED IN ALL
RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND EFFECT, BY THE LAWS OF THE
STATE OF KANSAS APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED WHOLLY
WITHIN SUCH STATE WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES OF SUCH
STATE.

 

Section 6.5             Termination.  Except with respect to Sections 5.1, 5.2,
6.3, 6.4, 6.7, 6.8, 6.10 and
6.11, the provisions of this Agreement will terminate immediately following the earlier of the date of the 2010 Annual Meeting of
Shareholders of the Company or June 30, 2010.

 

7

 

Section 6.6             Notices.  All notices, requests and other
communications to any party hereunder will be in
writing (including prepaid overnight courier, facsimile transmission or similar writing) and will be given to such party at its address or
facsimile number set forth in this Section 6.6 or at such other address or
facsimile number as such party may hereafter specify in writing.  Each such notice, request or other
communication will be effective (a) if given by
facsimile, when transmitted to the facsimile number specified in this Section 6.6, (b) if given by mail, upon the earlier of
actual receipt or three (3) business days after deposit in the United
States Mail, registered or certified mail, return receipt requested, properly
addressed and with proper postage prepaid, (c) one (1) business day
after deposit with an internationally reputable overnight courier properly
addressed and with all charges prepaid or (d) when received, if by any
other means.

 

Communications by facsimile will also be sent
concurrently by internationally reputable overnight courier properly addressed
and with all charges prepaid, but will in any event be effective as stated
above.

 

	
  The Company:

  
	
   

  
	
  Team Financial, Inc.

  
	
  Attn: Robert J. Weatherbie, CEO

  
	
  8 West Peoria, Suite 200

  
	
  P.O.  Box 402

  
	
  Paola, Kansas 66071-0402

  
	
  Facsimile Number: 913-294-4406

  
	
   

  
	
  with a copy to:

  
	
   

  
	
  Sandra K. Hartley, LLC

  
	
  Attn: Sandra Hartley, Esq.,

  
	
  16206 West 319th Street

  
	
  Paola, Kansas 66071

  
	
  Facsimile Number: 913-557-3828

  
	
   

  
	
  and to:

  
	
   

  
	
  Jones & Keller, P.C.

  
	
  Attn: Reid A. Godbolt, Esq.

  
	
  1625 Broadway, 16th Floor

  
	
  Denver, Colorado 80202

  
	
  Facsimile Number: 303-573-0769

  
	
   

  
	
  Mr. Edquist:

  
	
   

  
	
  Keith B. Edquist

  
	
  9747 Nottingham Drive

  
	
  Omaha, Nebraska 68114

  
	
  Facsimile Number:

  

 

8

 

	
  with a copy to:

  
	
   

  
	
  Cline, Williams, Wright,
  Johnson & Oldfather, L.L.P. Attn: Robert J. Routh, Esq.

  
	
  233 South 13th Street

  
	
  1900 U.S. Bank Building

  
	
  Lincoln, Nebraska 68508-2095

  
	
  Facsimile Number: 402-474-5393

  

 

The parties will promptly notify
each other in the manner provided in this Section 6.6 of any change in
their respective addresses.  A notice of
change of address will not be deemed to have been given until received by the
addressee.

 

Section 6.7             Severability.  If at any time subsequent to the date hereof;
any provision of this Agreement shall be held by any court of competent
jurisdiction to be illegal, void or unenforceable, such provision shall be of
no force and effect, but the illegality or unenforceability
of such provision shall have no effect upon the legality or enforceability of any other provision of this Agreement.

 

Section 6.8             Further Assurances.  The parties hereto agree to execute such
further documents and instruments and to take such further actions as may be
reasonably necessary to carry out the purposes and intent of this Agreement.

 

Section 6.9             Counterparts, Facsimile/PDF
Signatures.  This Agreement may be
executed in one or more counterparts each of which when so executed and
delivered will be deemed an original but all of which will constitute one and
the same Agreement.  This Agreement may be executed and delivered by facsimile or by email in
portable document  format
(.pdf or similar format) and upon delivery of the signature by such method will
be  deemed to have the same
effect as if the original signature had been delivered to the other parties.

 

Section 6.10           Construction of this Agreement.  The Parties acknowledge that each Party was
represented by legal counsel (or had the opportunity to be represented by legal
counsel) in connection with this Agreement, and
that each of them and their counsel have reviewed
and revised this Agreement, or have had an opportunity to do so, and that any rule of
construction to the effect that ambiguities are to be resolved against the
drafting Party shall not be employed in their interpretation of this Agreement
or any amendments or any exhibits hereto or thereto.

 

Section 6.11           Entire Agreement; Amendment.  This Agreement contains the entire
understanding of the Parties hereto with respect to its subject matter and
supersedes all prior agreements between the Parties hereto.  This Agreement may be amended only by a
written instrument duly executed by the Parties hereto, or their respective
successors or assigns.  Except as
provided herein, this Agreement will be binding upon and inure to the benefit
of the Parties and their respective Affiliates and Associates, and successors
and permitted assigns.  Nothing expressed
or implied herein is intended or will be construed to confer upon or to give to
any third party any rights or remedies by virtue hereof.

 

9

 

IN WITNESS
WHEREOF, this Settlement Agreement has been duly executed and delivered by the
duly authorized signatories of the Parties as of the date hereof.

 

 

	
  KEITH B. EDQUIST

  	
   

  	
  TEAM FINANCIAL, INC.

  
	
   

  	
   

  	
   

  
	
  /s/ Keith B. Edquist

  	
   

  	
  By:

  	
    /s/ Robert J. Weatherbie

  
	
   

  	
   

  	
   

  	
    Name:

  	
  Robert J. Weatherbie

  
	
   

  	
   

  	
   

  	
    Title:

  	
  Chairman and Chief Executive

  Officer

  

 

10

 

EXHIBIT A -
PRESS RELEASE

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  FOR IMMEDIATE

  	
   

  	
   

  
	
  RELEASE

  	
   

  	
  For More Information Contact:

  
	
   

  	
   

  	
  Robert J. Weatherbie

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
  Team Financial, Inc.

  
	
   

  	
   

  	
  (913) 294-9667

  
	
   

  	
   

  	
  bob.weatherbie@teamfinancialinc.com

  
	
   

  	
   

  	
   

  

 

Team Financial, Inc. and Keith
B. Edquist Announce Settlement Agreement

 

Paola, Kansas, July 11, 2008 - Team Financial, Inc.
(the “Company”) (NASDAQ: TFIN) and Keith B. Edquist announced today that they
have reached a settlement agreement that will avoid a proxy contest between the
parties at the Company’s 2008 Annual Meeting of Shareholders scheduled to be
held in August 2008.  The originally
scheduled meeting for June 17, 2008 was postponed.

 

Under the terms of the settlement, Mr. Edquist
has agreed to terminate his efforts to nominate persons for election as Class III
directors at the Company’s 2008 Annual Meeting of Shareholders, has agreed to
vote his shares in favor of the Company’s nominees for director at the 2008
Annual Meeting (Robert M. Blachly, Jeffrey L. Renner and Richard J. Tremblay),
and has agreed to abide by certain standstill provisions until the earlier of June 30,
2010 or the Company’s 2010 Annual Meeting. 
As part of the settlement, the parties executed a mutual release as
well.

 

Mr. Edquist’s obligations are contingent on the
agreement by and between the Company and certain investors known as the
Bicknell Group, dated June 16, 2008, to remain in full force and effect.

 

The Company expects to be nominating Robert M.
Blachly, Richard J. Tremblay and Jeffrey L. Renner as nominees for election as Class III
directors at the 2008 Annual Meeting. 
Additionally, the Company has agreed to reimburse Mr. Edquist for
certain expenses related to his proxy solicitation efforts.

 

“We are pleased to move forward with Keith Edquist
in maintaining and building our shareholder value for the Company,” said Robert
J. Weatherbie, Chief Executive Officer of Team Financial, Inc.  Mr. Edquist stated, “While I was
disappointed that the annual meeting was postponed on the 17th of June I
am hopeful that the corporate governance changes embodied in the agreement
between the Company and the Bicknell Group will provide the framework for the
Company to build shareholder value.”

 

 

IMPORTANT
INFORMATION AND WHERE TO FIND IT

 

In connection with its 2008 Annual Meeting, Team
Financial, Inc. intends to file a definitive proxy statement, and other
related materials with the U.S. Securities and Exchange Commission (“SEC”). WE
URGE INVESTORS TO READ THE PROXY STATEMENT AND THESE OTHER MATERIALS CAREFULLY
WHEN THEY BECOME AVAILABLE, BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT
TEAM FINANCIAL, INC. AND THE MATTERS TO BE CONSIDERED AT ITS ANNUAL MEETING.
Investors may contact Robert J. Weatherbie at (913) 294-9667 or by email at
bob.weatherbie@teamfinancialinc.com. Investors may also obtain a free copy of
the proxy statement and other relevant documents as well as other materials
filed with the SEC concerning Team Financial, Inc. at the SEC’s website at
http://www.sec.gov. These materials and other documents may also be obtained
for free from: Secretary, Team Financial, Inc., 8 West Peoria, Suite 200,
Paola, Kansas 66071 (913) 294-9667.

 

FORWARD-LOOKING
STATEMENTS

 

This press release contains forward-looking
statements under the Private Securities Litigation Reform Act of 1995 that are
subject to certain risks and uncertainties that could cause actual results to
differ materially from historical income and those presently anticipated or
projected.  The Company cautions readers not to place undue reliance on
any such forward looking statements, which speak only as of the date of this
release.  Such risks and uncertainties include those detailed in the
Company’s filings with the Securities and Exchange Commission, risks of adverse
changes in results of operations, risks related to the Company’s expansion
strategies, risks relating to loans and investments, including the effect of
the change of the economic conditions in areas the Company’s borrowers are
located, risks associated with the adverse effects of governmental
regulation,  changes in regulatory oversight, interest rates, and
competition for the Company’s customers by other providers of financial
services, all of which are difficult to predict and many of which are beyond
the control of the Company.

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