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TABLE OF CONTENTS
Table of Contents
As filed with the Securities and Exchange Commission on February 19, 2003.
March 17, 2017
Registration Statement No. 333-101304
================================================================================
333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
AMENDMENT NO. 2 TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
ACTIVISION, INC.
(Exact
Activision Blizzard, Inc.
(Exact name of registrant as specified in its charter)
Delaware 7372 95-4803544
(State or other jurisdiction Primary standard industrial (I.R.S. Employer
of incorporation or organization) classification code number)Identification No.)
| | | | |
Delaware
(State or other jurisdiction of
incorporation or organization) | | 7272
(Primary Standard Industrial
Classification Code Number) | | 95-4803544
(I.R.S. Employer
Identification Number) |
3100 Ocean Park Boulevard
Santa Monica, CaliforniaCA 90405
(310) 255-2000
(Address,
(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)
--------------------------
Ronald Doornink
President
Christopher B. Walther, Chief Legal Officer
Jeffrey A. Brown, Corporate Secretary and Chief Compliance Officer
Activision Blizzard, Inc.
3100 Ocean Park Boulevard
Santa Monica, CaliforniaCA 90405
(310) 255-2000
(Name,
(Name, address, including zip code, and telephone number, including area code, of agent for service)
--------------------------
Copies To:
Bryan Caveof all communications to:
Michael J. Zeidel, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
1290 Avenue of the Americas
Four Times Square
New York, New York 10104
Attention: Kenneth L. Henderson, Esq.
NY 10036
Telephone: (212) 735-3000
Facsimile: (212) 735-2000
Approximate date of commencement of proposed sale to the public:
From time to time
As soon as practicable after the effective date of this Registration Statement.registration statement becomes effective.
If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box: [ ]box. o
If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: [ ] ______________offering. o
If this form is a post-effective amendment filed pursuant to Rule 462(d)462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: [ ] ____________
offering. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
| | | | | | |
| Large accelerated filer ý | | Accelerated filer o | | Non-accelerated filer o
(Do not check if a
smaller reporting company) | | Smaller reporting company o |
If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) o
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) o
CALCULATION OF REGISTRATION FEE
| | | | | | | | |
| | | | | | | | |
| |
Title of Each Class of Securities
to be Registered
| | Amount to be
Registered
| | Proposed Maximum
Offering Price Per
Unit
| | Proposed Maximum
Aggregate Offering
Price
| | Amount of
Registration Fee
|
|---|
| |
2.300% Senior Notes due 2021 | | $650,000,000 | | 100% | | $650,000,000 | | $75,335 |
| |
3.400% Senior Notes due 2026 | | $850,000,000 | | 100% | | $850,000,000 | | $98,515 |
| |
Total | | $1,500,000,000 | | | | | | $173,850 |
|
The Registrantregistrant hereby amends this Registration Statementregistration statement on such date or dates as may be necessary to delay its effective date until the Registrantregistrant shall file a further amendment which specifically states that this Registration
Statementregistration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statementthis registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
Subject to Completion, Dated February 19, 2003
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The information in thethis prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectusProspectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any statejurisdiction where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED MARCH 17, 2017
PROSPECTUS
$250,000,000
ACTIVISION, INC.
Debt
Activision Blizzard, Inc.
Offer to exchange $650,000,000 aggregate principal amount of 2.300% Senior Notes due 2021 (the "old 2021 Notes") for $650,000,000 aggregate principal amount of 2.300% Senior Notes due 2021 (the "new 2021 Notes"); and
Offer to exchange $850,000,000 aggregate principal amount of 3.400% Senior Notes due 2026 (the "old 2026 Notes," and together with the old 2021 Notes, the "old notes") for $850,000,000 aggregate principal amount of 3.400% Senior Notes due 2026 (the "new 2026 Notes," and together with the new 2021 Notes, the "new notes").
The new notes have been registered under the Securities Preferred Stock
Common Stock
Warrants
Rights
Purchase Contracts
Units
Act of 1933, as amended (the "Securities Act").
The exchange offer will expire at 5:00 p.m., New York City time, on , 2017 (the "expiration date"), unless we extend the exchange offer with respect to one or both series in our sole and absolute discretion.
Terms of the exchange offer:
- •
- We will exchange the applicable series of new notes for all outstanding old notes that are validly tendered and not withdrawn prior to the expiration or termination of the exchange offer.
- •
- You may withdraw tenders of old notes at any time prior to the expiration or termination of the exchange offer.
- •
- The terms of the new notes are substantially identical to those of the applicable outstanding old notes, except that the transfer restrictions, payment of additional interest and registration rights relating to the old notes do not apply to the new notes.
- •
- The exchange of old notes for new notes will not be a taxable transaction for U.S. federal income tax purposes. You should see the discussion under the caption "U.S. Federal Income Tax Considerations" for more information.
- •
- We will not receive any proceeds from the exchange offer.
We issued the old notes in a transaction not requiring registration under the Securities Act, and as a result, their transfer is restricted. We are making the exchange offer to satisfy your registration rights as a holder of the old notes.
There is no established trading market for either series of the new notes.
Each broker-dealer that receives new notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such new notes. The accompanying letter of transmittal relating to the exchange offer states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, the following types of securities:
o our debt securities, in one or more series, which may be senior debt
securities or subordinated debt securities, in each case consisting of
notes or other unsecured evidences of indebtedness;
o shares of our preferred stock;
o shares of our common stock;
o warrants to purchase any of the other securities that may be sold under
this prospectus;
o rights to purchase preferred stock or common stock;
o purchase contracts to acquire any of the other securities that may be sold
under this prospectus; and
o any combination of these securities, individually or as units.
We may offer and sell, from time to time, in one or more offerings, up to
$250,000,000 of any combination of the securities we describe in this prospectus
in connection with our acquisition of the assets, business or securities of
other companies whetherused by purchase, merger, or any other form of business
combination.
Together with this registration statement, we are concurrently filing on
Form S-3 (Registration Number 333-101301) a registration statement for the sale
of up to $500 million of any combination of securities detailed in that
registration statement and a registration statement on Form S-3 (Registration
Number 333-101271) for the sale of 110,391 shares of our common stock.
If necessary, we will provide a prospectus supplement each time we issue
securities. The prospectus supplement will provide information about the terms
of that offering and also may add, update or change information contained in
this prospectus. You should read this prospectus and any prospectus supplement,
as well as the documents incorporated or deemed to be incorporated by reference
in this prospectus, carefully before you invest.
This prospectus may also be used for the resale of securities we issue in
connection with an acquisition. We have not authorized any person to use this
prospectusbroker-dealer in connection with resales of securities without our prior written
consent.
Our principal executive offices are located at 3100 Ocean Park Boulevard,
Santa Monica, California 90405, and our telephone number is (310) 255-2000.
Our common stock is traded onnew notes received in exchange for old notes where such old notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of up to 90 days after the Nasdaq National Market under the symbol
"ATVI." On February 13, 2003, the closing sale priceexpiration date, we will make this prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of our common stock as
reported by Nasdaq was $13.89 per share.
Investing in our securities involves risks that are described in theDistribution."
See "Risk Factors" section beginning on page 211 of this prospectus.
prospectus and under Part I, Item 1A "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2016 for a discussion of risks you should consider prior to tendering your outstanding old notes for exchange.
Neither the Securities and Exchange Commission (the "SEC"), nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this Prospectusprospectus is ___________, 2003.
, 2017
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ABOUT THIS PROSPECTUS ........................................................1
FORWARD LOOKING STATEMENTS ...................................................2
RISK FACTORS .................................................................2
ABOUT ACTIVISION ............................................................10
RATIOS OF EARNINGS TO FIXED CHARGES .........................................12
USE OF PROCEEDS .............................................................12
OFFERED SECURITIES ..........................................................12
DESCRIPTION OF DEBT SECURITIES ..............................................14
DESCRIPTION OF CAPITAL STOCK ................................................24
DESCRIPTION OF WARRANTS .....................................................29
DESCRIPTION OF RIGHTS .......................................................31
DESCRIPTION OF PURCHASE CONTRACTS ...........................................31
DESCRIPTION OF UNITS ........................................................32
LEGAL MATTERS ...............................................................32
EXPERTS .....................................................................32
WHERE YOU CAN FIND MORE INFORMATION .........................................32
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE .............................33
ABOUT THIS PROSPECTUS
| | | | |
SUMMARY | | | 1 | |
SUMMARY DESCRIPTION OF THE EXCHANGE OFFER | | | 2 | |
CONSEQUENCES OF NOT EXCHANGING OLD NOTES | | | 7 | |
SUMMARY DESCRIPTION OF THE NEW NOTES | | | 8 | |
RISK FACTORS | | | 11 | |
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS | | | 17 | |
USE OF PROCEEDS | | | 18 | |
RATIO OF EARNINGS TO FIXED CHARGES | | | 19 | |
THE EXCHANGE OFFER | | | 20 | |
DESCRIPTION OF THE NEW NOTES | | | 27 | |
BOOK-ENTRY, DELIVERY AND FORM | | | 56 | |
REGISTRATION RIGHTS | | | 61 | |
U.S. FEDERAL INCOME TAX CONSIDERATIONS | | | 63 | |
PLAN OF DISTRIBUTION | | | 64 | |
LEGAL MATTERS | | | 65 | |
EXPERTS | | | 65 | |
WHERE YOU CAN FIND MORE INFORMATION; INCORPORATION BY REFERENCE | | | 66 | |
This prospectus incorporates by reference important business and financial information about us that is partnot included in or delivered with this document. Copies of a registration statement that we filed withthis information are available without charge to any person to whom this prospectus is delivered, upon written or oral request. Written requests should be sent to:
Activision Blizzard, Inc.
3100 Ocean Park Boulevard
Santa Monica, CA 90405
Attn: Investor Relations
Oral requests should be made by telephoning (310) 255-2000.
In order to obtain timely delivery, you must request the Securities and Exchange Commission, or SEC, using a "shelf" registration
process. Underinformation no later than , 2017, which is five business days before the shelf process, we may, from time to time, sell in one or more
offerings up to $250,000,000 of anyexpiration date of the debt securities, preferred stock,
common stock, warrants, rights, purchase contractsexchange offer.
i
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SUMMARY
This summary contains basic information about the Company and units in connection with
the acquisitionexchange offer and highlights selected information contained elsewhere or incorporated by reference into this prospectus. This summary is not complete and does not contain all of the assets, businessinformation that is important to you and that you should consider before deciding whether or securitiesnot to invest in the new notes. For a more complete understanding of other companies whether
by purchase, merger, or any other form of business combination. Inthe Company and this exchange offer, you should read this prospectus, we will refer to the debt securities, preferred stock, common stock,
warrants, rights, purchase contracts and units collectively as the "securities."
For each acquisition, we expect to negotiate the terms with the owner(s) or
controlling person(s) of the assets, businesses, or securities we plan to
acquire. The securities issued in each acquisition will be valued at prices
which are based upon or reasonably related to market prices, or our valuation,
of the same or similar securities. Such valuation may occur at the time we agree
to the terms of an acquisition, the time of delivery of our securities, during
periods ending at or about such times based on average market prices, or
otherwise.
With our written consent, persons who have received or will receive
securities underincluding any information incorporated by reference into this prospectus, in connection with acquisitions may useits entirety. Investing in the new notes involves risks, including without limitation the risks that are described in this prospectus to sell such securities at a later date. We refer to these persons in
the prospectus as "selling security holders." Please see the information
described under the heading "Offered Securities" to find out more information
about resales of the securities by the selling security holders.
This prospectus provides you with a general description of the securities
that we may sell. If necessary, each time that we sell securities, we will
provide a prospectus supplement that will contain specific information about the
terms of that offering. The prospectus supplement also may add, update or change
information contained"Risk Factors" and in this prospectus. You should read both this prospectus
and any prospectus supplement together with additional information described
under the heading "Where You Can Find More Information." We are only selling
these securities in states where the sale is permitted.
The registration statement that contains this prospectus, including the
exhibits to the registration statement, contains additional information about us
and the securities offered under this prospectus. That registration statement
can be read at the SEC's web site or at the SEC's offices referenced under the
heading "Where You Can Find More Information."
FORWARD LOOKING STATEMENTS
We make statements in this prospectus and the documents incorporated by reference thatinto this prospectus. In this prospectus, the terms "Activision Blizzard," the "Company," "we," "our" and "us" refer to Activision Blizzard, Inc. and all of its consolidated subsidiaries collectively, in each case, except as otherwise specified or the context otherwise requires and the term "Issuer" refers to Activision Blizzard, Inc. and not to any of its subsidiaries.
Activision Blizzard Inc.'s names, abbreviations thereof, logos, and product and service designators are considered forward looking statementsall either the registered or unregistered trademarks or trade names of Activision Blizzard. All other product or service names are the property of their respective owners.
Activision Blizzard, Inc. is a leading global developer and publisher of interactive entertainment content and services. We develop and distribute content and services across all of the major gaming platforms, including video game consoles, personal computers, and mobile devices.
The Company was originally incorporated in California in 1979 and was reincorporated in Delaware in December 1992. We are the result of the 2008 business combination (the "Business Combination") by and among the Company (then known as Activision, Inc.), Vivendi S.A., and Vivendi Games, Inc., an indirect wholly-owned subsidiary of Vivendi S.A. In connection with the consummation of the Business Combination, Activision, Inc., was renamed Activision Blizzard, Inc.
The common stock of Activision Blizzard is traded on The NASDAQ Stock Market under the federal
securities laws. Such forward looking statements are basedticker symbol "ATVI."
Our principal executive office is located at 3100 Ocean Park Boulevard, Santa Monica, California, 90405, and our telephone number is (310) 255-2000. We maintain a website at http://www.activisionblizzard.com. The information on the beliefs of our management as well as assumptions madewebsite is not incorporated by and information currently available to
them. The words "anticipate," "believe," "may," "estimate," "expect," and
similar expressions, and variations of such terms or the negative of such terms,
are intended to identify such forward looking statements.
All forward looking statements are subject to certain risks, uncertainties
and assumptions. If one or more of these risks or uncertainties materialize, or
if underlying assumptions prove incorrect, our actual results, performance or
achievements could differ materially from those expressed in, or implied by, any
such forward looking statements. Important factors that could cause or
contribute to such difference include those discussed under "Risk Factors"reference in this prospectus, and you should not consider it a part of this prospectus.
On February 3, 2017, we entered into a sixth amendment to our Credit Agreement, dated October 11, 2013, as amended from time to time (the "Credit Agreement"). The amendment (i) provided for a new tranche of term loans "A" in an aggregate principal amount of $2.55 billion (the "2017 TLA") and (ii) released each of our subsidiary guarantors from their respective guarantee provided under "Business-Factors Affecting Future Performance"the Credit Agreement. The proceeds of the 2017 TLA, together with additional cash funds on hand, were used to fully prepay the existing $2.7 billion tranche of term loans "A" (the "2016 TLA") outstanding under the credit agreement immediately prior to the effectiveness of the sixth amendment, together with all accrued and unpaid interest thereon. The terms of the 2017 TLA, other than the absence of guarantees, are generally the same as the terms of the 2016 TLA.
As a result of the release of the guarantees under the Credit Agreement, the guarantees under our Indenture (as defined below) were automatically and unconditionally terminated. As used herein, the term "Credit Facilities" refers to the 2017 TLA, together with the amended revolving credit facility of $250 million provided by the Credit Agreement (the "Revolver").
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SUMMARY DESCRIPTION OF THE EXCHANGE OFFER
On September 19, 2016, we completed the private offering of two series of senior unsecured notes in an aggregate principal amount of $1,500,000,000, consisting of $650,000,000 of 2.300% Senior Notes due 2021 and $850,000,000 of 3.400% Senior Notes due 2026. As part of that offering, we entered into a registration rights agreement with the initial purchasers of each series of the old notes. Pursuant to the registration rights agreement, we agreed, among other things, to file a registration statement and deliver this prospectus to you and to use commercially reasonable efforts to complete an exchange offer of registered new notes for the old notes. Below is a summary of the exchange offer.
| | |
Old 2021 Notes | | 2.300% Senior Notes due 2021, which were issued on September 19, 2016. |
Old 2026 Notes | | 3.400% Senior Notes due 2026, which were issued on September 19, 2016. |
New 2021 Notes | | 2.300% Senior Notes due 2021, the issuance of which has been registered under the Securities Act. The form and terms of the new 2021 Notes are identical in all material respects to those of the old 2021 Notes, except that the transfer restrictions, payment of additional interest and registration rights relating to the old 2021 Notes do not apply to the new 2021 Notes. |
New 2026 Notes | | 3.400% Senior Notes due 2026, the issuance of which has been registered under the Securities Act. The form and terms of the new 2026 Notes are identical in all material respects to those of the old 2026 Notes, except that the transfer restrictions, payment of additional interest and registration rights relating to the old 2026 Notes do not apply to the new 2026 Notes. |
Exchange Offer for 2021 Notes | | We are offering to issue up to $650,000,000 aggregate principal amount of new 2021 Notes in exchange for a like principal amount of old 2021 Notes to satisfy our obligations under the registration rights agreement that was executed when the old 2021 Notes were issued in a transaction in reliance upon the exemptions from registration provided by Rule 144A and Regulation S of the Securities Act. |
Exchange Offer for 2026 Notes | | We are offering to issue up to $850,000,000 aggregate principal amount of new 2026 Notes in exchange for a like principal amount of old 2026 Notes to satisfy our obligations under the registration rights agreement that was executed when the old 2026 Notes were issued in a transaction in reliance upon the exemptions from registration provided by Rule 144A and Regulation S of the Securities Act. |
Expiration Date; Tenders | | The exchange offer will expire at 5:00 p.m., New York City time, on , 2017, unless extended with respect to one or both series in our sole and absolute discretion. By tendering your old notes, you represent to us that: |
| | • you are not our "affiliate," as defined in Rule 405 under the Securities Act; |
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| | |
| | • any new notes you receive in the exchange offer are being acquired by you in the ordinary course of your business; |
| | • neither you nor anyone receiving new notes from you has any arrangement or understanding with any person to participate in a distribution, as defined in the Securities Act, of the new notes; |
| | • you are not holding old notes that have, or are reasonably likely to have, the status of an unsold allotment in the initial offering; and |
| | • if you are a broker-dealer that will receive new notes for your own account in exchange for old notes that were acquired by you as a result of your market-making or other trading activities, you will deliver a prospectus in connection with any resale of the new notes you receive. For further information regarding resales of the new notes by participating broker-dealers, see the discussion under the caption "Plan of Distribution." |
Withdrawal; Non-Acceptance | | You may withdraw any old notes tendered in the exchange offer of a particular series at any time prior to 5:00 p.m., New York City time, on , 2017. If we decide for any reason not to accept any series of old notes tendered for exchange, the old notes of such series will be returned to the registered holder at our expense promptly after the expiration or termination of the exchange offer. In the case of the old notes tendered by book-entry transfer into the exchange agent's account at The Depository Trust Company ("DTC") any withdrawn or unaccepted old notes will be credited to the tendering holder's account at DTC. For further information regarding the withdrawal of tendered old notes, see "The Exchange Offer—Terms of the Exchange Offer; Period for Tendering Old Notes" and "The Exchange Offer—Withdrawal Rights." |
Conditions to the Exchange Offer | | The exchange offer is subject to customary conditions, which we may waive with respect to one or both series. See the discussion below under the caption "The Exchange Offer—Conditions to the Exchange Offer" for more information regarding the conditions to the exchange offer. |
Procedures for Tendering the Old Notes | | You must do one of the following on or prior to the applicable expiration of the exchange offer to participate in the exchange offer: |
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| | |
| | • tender your old notes by sending the certificates for your old notes, in proper form for transfer, a properly completed and duly executed letter of transmittal, with any required signature guarantees, and all other documents required by the letter of transmittal, to Wells Fargo Bank, National Association, as exchange agent, at one of the addresses listed below under the caption "The Exchange Offer—Exchange Agent;" or |
| | • tender your old notes by using the book-entry transfer procedures described below and transmitting a properly completed and duly executed letter of transmittal, with any required signature guarantees, or an agent's message instead of the letter of transmittal, to the exchange agent. In order for a book-entry transfer to constitute a valid tender of your old notes in the exchange offer, Wells Fargo Bank, National Association, as exchange agent, must receive a confirmation of book-entry transfer of your old notes into the exchange agent's account at DTC prior to the expiration of the exchange offer. For more information regarding the use of book-entry transfer procedures, including a description of the required agent's message, see the discussion below under the caption "The Exchange Offer—Book-Entry Transfers." |
Special Procedures for Beneficial Owners | | If you are a beneficial owner whose old notes are registered in the name of the broker, dealer, commercial bank, trust company or other nominee and you wish to tender your old notes in the exchange offer, you should promptly contact the person in whose name the old notes are registered and instruct that person to tender on your behalf. If you wish to tender in the exchange offer on your own behalf, prior to completing and executing the letter of transmittal and delivering your old notes, you must either make appropriate arrangements to register ownership of the old notes in your name or obtain a properly completed bond power from the person in whose name the old notes are registered. |
U.S. Federal Income Tax Considerations | | The exchange of the old notes for new notes in the exchange offer will not be a taxable transaction for United States federal income tax purposes. See the discussion under the caption "U.S. Federal Income Tax Considerations" for more information regarding the tax considerations of the exchange offer. |
Use of Proceeds | | We will not receive any proceeds from the exchange offer. |
Exchange Agent | | Wells Fargo Bank, National Association is the exchange agent for the exchange offer. You can find the address and telephone number of the exchange agent below under the caption "The Exchange Offer—Exchange Agent." |
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| | |
Resales | | Based on interpretations by the staff of the SEC, as set forth in no-action letters issued to third parties, we believe that the new notes you receive in the exchange offer may be offered for resale, resold or otherwise transferred without compliance with the registration and prospectus delivery provisions of the Securities Act. However, you will not be able to freely transfer the new notes if: |
| | • you are our "affiliate," as defined in Rule 405 under the Securities Act; |
| | • you are not acquiring the new notes in the exchange offer in the ordinary course of your business; |
| | • you are engaged in or intend to engage in or have an arrangement or understanding with any person to participate in the distribution, as defined in the Securities Act, of the new notes you will receive in the exchange offer; or |
| | • you are holding old notes that have or are reasonably likely to have the status of an unsold allotment in the initial offering. |
| | If you are an affiliate of ours, are engaged in or intend to engage in or have any arrangement or understanding with any person to participate in the distribution of the new notes: |
| | • you cannot rely on the applicable interpretations of the staff of the SEC; and |
| | • you must comply with the registration requirements of the Securities Act in connection with any resale transaction. |
| | Each broker-dealer that receives new notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such new notes. The accompanying letter of transmittal relating to the exchange offer states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of new notes received in exchange for old notes where such old notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of up to 90 days after the expiration date, we will make this prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution" for more information. |
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| | |
| | As a condition to participation in the exchange offer, each holder will be required to represent that it is not our affiliate or a broker-dealer that acquired the old notes directly from us. |
Registration Rights Agreement | | When the old notes were issued, we entered into a registration rights agreement with the initial purchasers of each series of the old notes. Under the terms of the registration rights agreement, we agreed to use our commercially reasonable efforts to file with the SEC and cause to become effective a registration statement relating to an offer to exchange the old notes for the new notes, and to consummate the exchange offer not later than the 365th day following the closing of the offering of the old notes (the "Exchange Date"). |
| | If neither (1) this exchange offer has been consummated on or prior to the Exchange Date with respect to a series of old notes or (2) a shelf registration statement covering resales of such series of old notes has been filed and been declared or otherwise become effective on or prior to the Exchange Date (together, a "registration default"), then additional interest will accrue on the aggregate principal amount of such series of old notes from and including the date on which such registration default has occurred to but excluding the date on which such registration default has been cured. Additional interest will accrue at a rate of 0.25% for the first 90 day period after such date and thereafter it will be increased by an additional 0.25% for each subsequent 90 day period that elapses, provided that the aggregate increase in such annual interest rate may in no event exceed 0.50% per annum over the applicable rate of such series of old notes, i.e. 2.300 and 3.400% in respect of the old 2021 Notes and the old 2026 Notes, respectively. |
| | A copy of the registration rights agreement is filed as an exhibit to the registration statement of which this prospectus forms a part. See "Registration Rights." |
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CONSEQUENCES OF NOT EXCHANGING OLD NOTES
If you do not exchange your old notes in the exchange offer, your old notes will continue to be subject to the restrictions on transfer described in the legend on the certificate for your old notes. In general, you may offer or sell your old notes only:
- •
- if they are registered under the Securities Act and applicable state securities laws;
- •
- if they are offered or sold under an exemption from registration under the Securities Act and applicable state securities laws; or
- •
- if they are offered or sold in a transaction not subject to the Securities Act and applicable state securities laws.
We do not currently intend to register the old notes under the Securities Act. Under some circumstances, however, holders of the old notes whose old notes are or were ineligible to be exchanged in the exchange offer may require us to file and cause to become effective, a shelf registration statement covering resales of old notes by these holders. For more information regarding the consequences of not tendering your old notes and our obligation to file a shelf registration statement, see "The Exchange Offer—Consequences of Exchanging or Failing to Exchange Old Notes."
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SUMMARY DESCRIPTION OF THE NEW NOTES
The terms of the new notes and those of the outstanding old notes are substantially identical, except that the transfer restrictions, additional interest and registration rights relating to the old notes do not apply to the new notes. For a more complete understanding of the new notes, see "Description of the New Notes."
Terms of the New Notes
| | |
New 2021 Notes | | Up to $650,000,000 aggregate principal amount of 2.300% senior notes due 2021. |
New 2026 Notes | | Up to $850,000,000 aggregate principal amount of 3.400% senior notes due 2026. |
Maturity Date of New 2021 Notes | | September 15, 2021. |
Maturity Date of New 2026 Notes | | September 15, 2026. |
Interest Rates; Interest Payment Dates | | March 15 and September 15 of each year after the date of issuance of the new notes, commencing September 15, 2017 (representing the interest payment date following March 15, 2017, the most recent interest payment date on the old notes). Interest will accrue from the most recent interest payment date on the applicable series of old notes, in each case, March 15, 2017, at a rate of 2.300% per annum for the new 2021 Notes and a rate of 3.400% per annum for the new 2026 Notes. |
Optional Redemption | | At our option, we may redeem some or all of the new notes of any series, at any time and from time to time. If we elect to redeem the new 2021 Notes prior to August 15, 2021 (the date that is one month prior to their maturity date), or the new 2026 Notes prior to June 15, 2026 (the date that is three months prior to their maturity date), we will pay a redemption price equal to 100% of the principal amount of the applicable series of the new notes plus a "make-whole premium" and accrued and unpaid interest, if any, to, but excluding, the redemption date. If we elect to redeem the new 2021 Notes on or after the date that is one month prior to their maturity date, or the new 2026 Notes on or after the date that is three months prior to their maturity date, we will pay a redemption price equal to 100% of their principal amount plus accrued and unpaid interest, if any, to, but excluding, the redemption date. See "Description of the New Notes—Optional Redemption." |
Guarantors | | None. |
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| | |
Priority | | The new notes will: |
| | • be unsecured senior obligations of the Issuer; • bepari passu in right of payment with all of the Issuer's existing and future senior indebtedness (including the Credit Facilities); • be effectively subordinated to all existing and future secured indebtedness of the Issuer to the extent of the value of the collateral securing such indebtedness; • be structurally subordinated to all existing and future indebtedness and other liabilities of the Issuer's subsidiaries; and • be senior in right of payment to any future subordinated indebtedness of the Issuer.
As of December 31, 2016, after giving effect to the exchange of the new notes, we would have had $4.9 billion of total indebtedness of which none would have been secured indebtedness. We would also have had $250 million of borrowings available under our Revolver, which remains undrawn as of the date hereof. |
Mandatory Offers to Repurchase | | If we experience a "Change of Control Repurchase Event" (as defined in the "Description of the New Notes"), we must offer to repurchase the new notes at a price equal to 101% of the aggregate principal amount of any new notes repurchased plus accrued and unpaid interest on the new notes, if any (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), to the date of purchase. See "Description of the New Notes—Repurchase of Notes upon a Change of Control Repurchase Event." |
Covenants | | We will issue the new notes under the same indenture (the "Indenture") that governs the old notes. The terms of the Indenture, among other things, restricts our ability, and the ability of certain of our subsidiaries, to incur liens, enter into sale and leaseback transactions and consolidate, merge or transfer all or substantially all of our assets and the assets of our subsidiaries. The covenants are subject to a number of exceptions and qualifications. For more details, see "Description of the New Notes—Certain Covenants." |
No Prior Market | | The new notes generally will be freely transferable but will also be new securities for which there is currently no market. Accordingly, a liquid market for the new notes of either series may not develop or be maintained. We have not applied, and do not intend to apply, for the listing of the new notes on any exchange or automated dealer quotation system. Accordingly, there can be no assurance as to the development or liquidity of any market for any series of new notes. |
Use of Proceeds | | We will not receive any proceeds from the exchange offer. Any old notes that are properly tendered and exchanged pursuant to the exchange offer will be retired and cancelled. |
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| | |
Risk Factors | | Tendering your old notes in the exchange offer involves risks. You should carefully consider the information set forth in this prospectus and, in particular, should evaluate the specific factors set forth in the section entitled "Risk Factors" for an explanation of certain risks of the exchange offer and investing in the new notes before tendering any old notes. For a description of risks related to our industry and business, you should also evaluate the specific risk factors described in Part I, Item 1A "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016 and the other information set forth or incorporated by reference into this prospectus. |
Governing Law | | The new notes will be and the Indenture is governed by and construed in accordance with the laws of the State of New York. |
Trustee | | Wells Fargo Bank, National Association. |
Exchange Agent | | Wells Fargo Bank, National Association. |
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RISK FACTORS
Participating in the exchange offer is subject to a number of risks. You should carefully consider the risks and uncertainties set forth below and the risks and uncertainties incorporated by reference in this prospectus, including the information included under "Risk Factors" in our Annual Report on Form 10 K10-K for the fiscal year ended MarchDecember 31, 2002. You should2016 and other documents that we subsequently file with the SEC.
Risks Related to the Exchange Offer and Holding the New Notes
Holders who fail to exchange their old notes will continue to be subject to restrictions on transfer.
If you do not place undue relianceexchange your old notes for new notes in the exchange offer, you will continue to be subject to the restrictions on such forward looking statements, which speaktransfer of your old notes described in the legend on the certificates for your old notes. The restrictions on transfer of your old notes arise because we issued the old notes under exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws. In general, you may only as
of their dates.offer or sell the old notes if they are registered under the Securities Act and applicable state securities laws, or offered and sold under an exemption from these requirements. We do not undertake any obligationplan to updateregister the old notes under the Securities Act. For further information regarding the consequences of not tendering your old notes in the exchange offer, see the discussion below under the caption "The Exchange Offer—Consequences of Exchanging or revise any
forward looking statements, whether as a resultFailing to Exchange Old Notes."
You must comply with the exchange offer procedures in order to receive freely tradable new notes.
Delivery of new information, future
eventsnotes in exchange for old notes tendered and accepted for exchange pursuant to the exchange offer will be made only after timely receipt by the exchange agent of the following:
- •
- certificates for old notes or
otherwise. Youa book-entry confirmation of a book-entry transfer of old notes into the exchange agent's account at DTC, New York, New York, as depository;
- •
- a completed and signed letter of transmittal (or facsimile thereof), with any required signature guarantees, or an agent's message in lieu of the letter of transmittal; and
- •
- any other documents required by the letter of transmittal.
Therefore, holders of old notes who would like to tender old notes in exchange for new notes should carefully considerbe sure to allow enough time for the information set forthold notes to be delivered on time. We are not required to notify you of defects or irregularities in tenders of old notes for exchange. Old notes that are not tendered or that are tendered but we do not accept for exchange will, following consummation of the exchange offer, continue to be subject to the existing transfer restrictions under the heading "Risk Factors."
RISK FACTORS
You should carefully consider the risks described below before investing in
our securities. The occurrence of anySecurities Act and, upon consummation of the following risksexchange offer, certain registration and other rights under the registration rights agreement will terminate. See "The Exchange Offer—Exchange Offer Procedures" and "The Exchange Offer—Consequences of Exchanging or Failing to Exchange Old Notes."
Some holders who exchange their old notes may be deemed to be underwriters and these holders will be required to comply with the registration and prospectus delivery requirements in connection with any resale transaction.
If you exchange your old notes in the exchange offer for the purpose of participating in a distribution of the new notes, you may be deemed to have received restricted securities and, if so, will be required to comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction.
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Our debt could harmadversely affect our business.
As of December 31, 2016, after giving effect to this exchange offer, our consolidated indebtedness would have been approximately $4.9 billion. Our debt burden could have important consequences, including: increasing our vulnerability to general adverse economic and industry conditions; limiting our flexibility in planning for, or reacting to, changes in our business and our prospects.industry; requiring the dedication of a substantial portion of any cash flow from operations for the payment of principal and interest on, our indebtedness, thereby reducing the availability of cash flow to fund our operations, growth strategy, working capital, capital expenditures, future business opportunities, and other general corporate purposes; exposing us to the risk of increased interest rates with respect to any borrowings that are at floating rates of interest; restricting us from making strategic acquisitions or causing us to make non-strategic divestitures; limiting our ability to obtain additional financing for working capital, capital expenditures, research and development, acquisitions and general corporate or other purposes; limiting our ability to adjust to changing market conditions; and placing us at a competitive disadvantage relative to our competitors who are less highly leveraged. In that event, our business may be negatively
affected, the price of our stock may decline and you may lose part or all of
your investment.
We depend on a relatively small number of brands foraddition, a significant portion of our revenuescash and profits.
A significant portion of our revenuesinvestments are derived from products based on a
relatively small number of popular brands each year. In addition, many of these
products have substantial production or acquisition costs and marketing budgets.
In fiscal 2002, 50% of our worldwide net publishing revenues (35% of
consolidated net revenues) was derived from two brands, one of which accounted
for 44% andheld outside the other of which accounted for 6% of worldwide net publishing
revenues (31% and 4%, respectively, of consolidated net revenues). In fiscal
2001, two brands accounted for 49% of our worldwide net publishing revenues (37%
of consolidated net revenues), one of which accounted for 39% and the other of
which accounted for 10% of worldwide net publishing revenues (29% and 8%,
respectively, of consolidated net revenues). We expect that a limited number of
popular brands will continue to produce a disproportionately large amount of our
revenues. Due to this dependence on a limited number of brands, the failure of
one or more products based on these brands to achieve anticipated results may
significantly harm our business and financial results.
Our future success depends on our ability to release popular products.
The life of any one game product is relatively short, in many cases less
than one year. It is therefore important for us to be able to continue to
develop many high quality new products that are popularly received. If we are
unable to do this, our business and financial results may be negatively
affected.
We focus our development and publishing activities principally on products
that are, or have the potential to become, franchise brand properties. Many of
these products are based on intellectual property and other character or
2
story rights acquired or licensed from third parties. These license and
distribution agreements are limited in scope and time,United States, and we may not be able to renew key licenses when they expireservice our debt without undergoing the costs of repatriating those funds.
The agreements governing our debt, including the new notes, contain various covenants that impose restrictions on us that may affect our ability to operate our business.
Agreements governing our indebtedness, including our Credit Agreement and the indentures governing our notes, impose operating and financial restrictions on our activities. These restrictions require us to comply with or maintain certain financial tests and ratios. In addition, under certain circumstances our, Credit Agreement and indentures may limit or prohibit our ability to, include new productsamong other things: incur additional debt and guarantees; pay distributions or dividends and repurchase stock; make other restricted payments, including without limitation, certain investments; create liens; enter into agreements that restrict dividends from subsidiaries; engage in existing
licenses. The losstransactions with affiliates; and enter into mergers, consolidations or sales of a significant numbersubstantially all of our intellectual property licensesassets. In addition, we are required to maintain a maximum total net debt ratio calculated pursuant to a financial maintenance covenant under our credit agreement. Further, various risks, uncertainties and events beyond our control could affect our ability to comply with these covenants. Failure to comply with any of the covenants in our financing agreements could result in a default under those agreements and under other agreements containing cross-default provisions. Such a default would permit lenders to accelerate the maturity of the debt under these agreements. Under these circumstances, we might not have sufficient funds or other resources to satisfy all of our relationships with licensors could have a material adverse effectobligations, including our obligations under our Credit Agreement or the indentures governing our notes. In addition, the limitations imposed by financing agreements on our ability to develop new productsincur additional debt and thereforeto take other actions might significantly impair our ability to obtain other financing. There can be no assurances that we will be granted waivers or amendments to these agreements if for any reason we are unable to comply with these agreements or that we will be able to refinance our debt on terms acceptable to us, or at all.
If we default on our business and financial
results.
Transitions in console platforms have a material impact on the market for
interactive entertainment software.
When new console platforms are announced or introduced into the market,
consumers typically reduce their purchases of game console entertainment
software products for current console platforms in anticipation of new platforms
becoming available. During these periods, sales ofobligations under our game console
entertainment software products can be expected to slow down or even decline
until new platforms have been introduced and have achieved wide consumer
acceptance. Each of the three current principal hardware producers launched a
new platform in recent years. Sony made the first shipments of its PlayStation 2
console system in North America and Europe in the fourth quarter of calendar
year 2000. Microsoft made the first shipments of its Xbox console system in
North America in November 2001 and in Europe and Japan in the first quarter of
calendar 2002. Nintendo made the first shipments of its Nintendo GameCube
console system in North America in November 2001 and in Europe in May 2002.
Additionally, in June 2001, Nintendo launched its Game Boy Advance hand held
device. We believe the next hardware transition cycle will occur in 2005. Delays
in the launch, shortages, technical problems or lack of consumer acceptance of
these platforms could adversely affect our sales of products for these
platforms.
We must make significant expenditures to develop products for new platforms
which may not be successful or released when anticipated.
The interactive entertainment software industry is subject to rapid
technological change. New technologies could render our current products or
products in development obsolete or unmarketable. We must continually anticipate
and assess the emergence and market acceptance of new interactive entertainment
software platforms well in advance of the time the platform is introduced to
consumers. New platforms have historically required the development of new
software and also have the effect of undermining demand for products based on
older technologies. Because product development cycles are difficult to predict,
we must make substantial product development and other investments in a
particular platform well in advance of introduction of the platform. If the
platforms for which we develop new software products or modify existing products
are not released on a timely basis or do not attain significant market
penetration, or if we develop products for a delayed or unsuccessful platform,indebtedness, we may not be able to recovermake payments on the new notes.
Any default under the agreements governing our indebtedness, including a default under the Credit Facilities, that is not waived by the required percentage of lenders could result in revenues our development costs whichinability to pay principal, premium and additional amounts, if any, and interest on the new notes and substantially decrease the market value of the new notes. If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any, and interest on our indebtedness, or if we otherwise fail to comply with the various covenants, including financial and operating covenants, in the agreements governing our indebtedness, we could be
significant
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in default under the terms of the agreements governing such indebtedness. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, the lenders under the Credit Facilities could elect to terminate their commitments, cease making further loans and institute foreclosure proceedings against our assets, and we may seek protection under the bankruptcy code.
If we breach our covenants under the Indenture, under the Credit Facilities or under any agreements governing future senior credit facilities or other indebtedness, we may need to request waivers from the required percentage of lenders or required percentage of holders to avoid being in default. If we are unable to obtain a waiver from the lenders or holders, we would be in default under the instrument governing that indebtedness, the lenders or holders could exercise their rights as described above, and we may seek protection under the bankruptcy code.
Because none of our subsidiaries are guaranteeing the new notes, your right to receive payment on the new notes will be structurally subordinated to the liabilities of our subsidiaries.
None of our subsidiaries will be required to guarantee the new notes on their issue date. Creditors of our subsidiaries (including trade creditors) will generally be entitled to payment from the assets of those subsidiaries before those assets can be distributed for the benefit of noteholders. As a result, the new notes will be structurally subordinated to the prior payment of all of the existing and future debt and other liabilities (including trade payables) of our subsidiaries. In the event of a bankruptcy, liquidation or reorganization of any of our subsidiaries, holders of their indebtedness and their trade creditors will generally be entitled to payment of their claims from the assets of those subsidiaries before any assets are made available for distribution to the Issuer of the Notes. For the year ended December 31, 2016, after intercompany eliminations the subsidiaries accounted for approximately 100% of our total revenue and Adjusted EBITDA. In addition, as of December 31, 2016, our subsidiaries had outstanding approximately $3.3 billion of total liabilities.
The new notes are our unsecured obligations and are effectively subordinated to our secured debt to the extent of the collateral securing such indebtedness.
The new notes will be our senior unsecured obligations. Holders of our existing and future secured indebtedness will have claims that are senior to the claims of the holders of the new notes, to the extent of the value of the assets securing such other indebtedness. As a result, in the event of any distribution or payment of our assets in any bankruptcy, liquidation or dissolution, holders of secured indebtedness will have a prior claim to those assets that constitute their collateral. In any of the foregoing events, there can be no assurance that there will be sufficient assets to pay all amounts due on the new notes.
As of December 31, 2016, after giving effect to the exchange of the new notes, we would have had $4.9 billion of total indebtedness of which none would have been secured indebtedness. We would also have had $250 million of borrowings available under our Revolver, which remains undrawn as of the date hereof.
Our ability to service and repay the new notes will be dependent on the cash flow generated by our subsidiaries, primarily our domestic subsidiaries.
Repayment of the new notes will depend on our subsidiaries' generation of cash flow, which will, in turn, depend principally upon future operating performance, and our subsidiaries' ability to make such cash available to us, by dividend, debt repayment or otherwise. As a result, prevailing economic conditions and financial, business and financial results could be significantly
harmed. An announcement by Sega Corporation in calendar 2001 that it was
discontinuing its Dreamcast platform shows that even experienced hardware
manufacturersother factors, many of which are not immunebeyond our control, will affect our ability to failure.
We are exposedmake payments on our debt. In particular, due to seasonality in the purchasesseasonal nature of our products.
Thethe interactive entertainment software industry, is highly seasonal, with the highest levels of consumer demand occurring during the year-end
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holiday buying season. As a result,season in the fourth quarter of the year, our net revenues, gross profits and operating income
have historically been highest duringsubsidiaries' cash flow in the first half of the year may be less than in the second half of the year. Additionally,
in a platform transition period, sales of game console software products can be
significantly affected by the timeliness of introduction of game console
platforms by the manufacturers of those platforms, such as Sony, Microsoft and
Nintendo. The timing of hardware platform introduction is also often tied to
holidays and is not within our control. Further, delays in development, licensor
approvals or manufacturing can alsoyear, which may affect the timing of the release of our
products, causing us to miss key selling periods such as the year-end holiday
buying season.
3
We depend on skilled personnel.
Our success depends to a significant extent on our ability to identify,
hire and retain skilled personnel. The software industry is characterized by a
high level of employee mobility and aggressive recruiting among competitors for
personnel with technical, marketing, sales, product development and management
skills. We may not be ablesatisfy our debt service obligations, including to attract and retain skilled personnel or may incur
significant costs in order to do so. If we are unable to attract additional
qualified employees or retainservice the services of key personnel, our business and
financial results could be negatively impacted.
We depend on Sony, Nintendo and Microsoft for the manufacture and approval of
products that we develop for their hardware platforms.
Generally, when we develop interactive entertainment software products for
hardware platformsnew notes offered by Sony, Nintendo and Microsoft, the products are
manufactured exclusively by that hardware manufacturer. Our hardware platform
licenses with Sony, Nintendo and Microsoft provide that the manufacturer may
change prices for the manufacturing of products.hereby. In addition, these agreements include other provisions such as approval rights
of all products and related promotional materials that give the manufacturer
substantial control over our costs and the release of new titles. Since each of
the manufacturers is alsowe earn a publisher of games for its own hardware platforms
and manufactures products for all of its other licensees, a manufacturer may
give priority to its own products or thosesignificant amount of our competitors in the event of
insufficient manufacturing capacity. Our businessoperating income, and financial results could be
materially harmed by unanticipated delays in the manufacturing and deliveryhold a significant portion of our products by Sony, Nintendocash and Microsoft. In addition,investments, in our business and
financial results could be materially harmed if Sony, Nintendo or Microsoft used
their rights under these agreements to delayforeign subsidiaries outside the manufacture or deliveryUnited States. As of our
products, limitDecember 31, 2016, the costs recoverable by us to manufacture software for their
consoles, or elect to manufacture software themselves or use developers other
than us.
If our products contain defects, our business could be harmed significantly.
Software products as complex as the ones we publish may contain undetected
errors when first introduced or when new versions are released. We cannot assure
you that, despite extensive testing prior to release, errors will not be found
in new products or releases after shipment, resulting in loss of or delay in
market acceptance. This loss or delay could significantly harm our business and
financial results.
Inadequate intellectual property protections could prevent us from enforcing or
defending our proprietary technology.
We regard our software as proprietary and rely on a combination of
copyright, trademark and trade secret laws, employee and third party
nondisclosure agreements and other methods to protect our proprietary rights. We
own or license various copyrights and trademarks. While we provide "shrinkwrap"
license agreements or limitations on use with our software, it is uncertain to
what extent these agreements and limitations are enforceable. We are aware that
some unauthorized copying occurs within the computer software industry, and if a
significantly greater amount of unauthorized copying of our interactive
entertainment software products were to occur, it could cause material harm to
our businesscash and financial results.
Policing unauthorized use of our products is difficult, and software piracy
can be a persistent problem, especially in some international markets. Further,
the laws of some countries where our products are or may be distributed either
do not protect our products and intellectual property rights to the same extent
as the lawscash equivalents held outside of the United States orby our foreign subsidiaries was $1.9 billion. If our domestic subsidiaries are poorly enforced. Legal protection ofnot able to generate sufficient cash flow to satisfy our rightsdebt service obligations, including to service the new notes, we may be ineffective in such countries,need to repatriate these funds and as we leverage our software
products using emerging technologies such as the Internet and online services,
our ability to protect our intellectual property rights and to avoid infringing
intellectual property rights of others may diminish.
4
We cannot assure you that existing intellectual property laws will provide
adequate protection for our products in connection with these emerging
technologies.
We may be subject to intellectual property claims.
As the number of interactive entertainment software products increases and
the features and content of these products continue to overlap, software
developers increasingly may become subject to infringement claims. Many of our
products are highly realistic and feature materials that are based on real world
examples, which may inadvertently infringe upon the intellectual property rights
of others. Althougha higher effective tax rate.
If we believe that we make reasonable efforts to ensure that
our products do not violate the intellectual property rights of others, it is
possible that third parties still may claim infringement. From time to time, we
receive communications from third parties regarding such claims. Existing or
future infringement claims against us, whether valid or not, may be time
consuming and expensive to defend.
Intellectual property litigation or claims could force us to do one or
more of the following:
o Cease selling, incorporating or using products or services that
incorporate the challenged intellectual property;
o Obtain a license from the holder of the infringed intellectual
property, which if available at all, may not be available on
commercially favorable terms; or
o Redesign our interactive entertainment software products, which
could cause us to incur additional costs, delay introduction and
possibly reduce commercial appeal of our products.
Any of these actions may cause material harm to our business and
financial results.
We rely on independent third parties to develop some of our software products.
We often rely on independent third party interactive entertainment software
developers to develop some of our software products. Since we depend on these
developers in the aggregate, we remain subject to the following risks:
o Continuing strong demand for developers' resources, combined with
recognition they receive in connection with their work, may cause
developers who worked for us in the past to either work for our
competitors in the future or to renegotiate our agreements with
them on terms less favorable for us.
o Limited financial resources and business expertise and inability
to retain skilled personnel may force developers out of business
prior to completing our products or require us to fund additional
costs.
o Our competitors may acquire the businesses of key developers or
sign them to exclusive development arrangements. In either case,
we would not be able to engage such developers' services for our
products.
Increased competition for skilled third party software developers also has
compelled us to agree to make significant advance payments on royalties to game
developers. If the products subject to these arrangements do not generate sufficient revenuescash flow to recover these royalty advances,satisfy our debt service obligations, including payments on the new notes, we wouldmay have to write-off unrecovered portions of these payments, which could cause material
harmundertake alternative financing plans, such as refinancing or restructuring our debt, selling assets, reducing or delaying capital investments or seeking to raise additional capital. Our ability to restructure or refinance our businessdebt will depend on the capital markets and our financial results. In a few cases, we also agree to pay
developers fixed per unit product royalties after royalty advances are fully
recouped. To the extent that sales prices of products on which we have agreed to
pay a fixed per unit royalty are marked down, our profitability could be
adversely affected.
5
We operate in a highly competitive industry.
The interactive entertainment software industry is intensely competitive
and new interactive entertainment software products and platforms are regularly
introduced. Our competitors vary in size from small companies to very large
corporations with significantly greater financial, marketing and product
development resources than we have. Due to these greater resources, certaincondition at such time. Any refinancing of our competitors can undertake more extensive marketing campaigns, adopt more
aggressive pricing policies, paydebt could result in higher fees to licensors for desirable motion
picture, television, sports and character properties and pay more to third party
software developers than we can. We believe that the main competitive factors in
the interactive entertainment software industry include: product features; brand
name recognition; compatibility of products with popular platforms; access to
distribution channels; quality of products; ease of use; price; marketing
support; and quality of customer service.
We compete primarily with other publishers of personal computer and video
game console interactive entertainment software. Significant third party
software competitors currently include, among others: Acclaim Entertainment,
Inc.; Capcom Co. Ltd.; Eidos PLC; Electronic Arts Inc.; Infogrames SA; Konami
Company Ltd.; Namco Ltd.; Midway Games, Inc.; Sega Enterprises, Ltd.; Take-Two
Interactive Software, Inc.; THQ Inc. and Vivendi Universal Publishing. In
addition, integrated video game console hardware and software companies such as
Sony Computer Entertainment, Nintendo Co. Ltd. and Microsoft Corporation compete
directly with us in the development of software titles for their respective
platforms.
We also compete with other forms of entertainment and leisure activities.
For example, we believe that the overall growth in the use of the Internet and
online services by consumers may pose a competitive threat if customers and
potential customers spend less of their available time using interactive
entertainment software and more using the Internet and online services.
We may face difficulty obtaining access to retail shelf space necessary to
market and sell our products effectively.
Retailers of our products typically have a limited amount of shelf space
and promotional resources, and there is intense competition among consumer
interactive entertainment software products for high quality retail shelf space
and promotional support from retailers. To the extent that the number of
products and platforms increases, competition for shelf space may intensifyinterest rates and may require us to increasecomply with more onerous covenants, which could further restrict our marketing expenditures. Retailers with limited
shelf space typically devote the most and highest quality shelf space to the
best selling products. We cannot assure you that our new products will
consistently achieve such "best seller" status. Due to increased competition for
limited shelf space, retailers and distributors are in an increasingly better
position to negotiate favorablebusiness operations. The terms of sale,the Indenture or any existing debt instruments or future debt instruments that we may enter into may restrict us from adopting some of these alternatives. The inability of our subsidiaries to generate sufficient cash flow to satisfy our debt service obligations, including price discounts, price
protection, marketing and display fees and product return policies. Our products
constitute a relatively small percentage of any retailer's sales volume, and we
cannot assure you that retailers will continuethe inability to purchase our productsservice the new notes offered hereby, or to providerefinance our products with adequate levels of shelf space and promotional supportobligations on acceptable terms. A prolonged failure in this regard may significantly harm
our business and financial results.
Our sales may decline substantially without warning and in a brief period of
time because we generally do not have long-term contracts for the sale of our
products.
We currently sell our products directly through our own sales force to mass
merchants, warehouse club stores, large computer and software specialty chains
and through catalogs, as well as to a limited number of distributors, in the
United States and Canada. Outside North America, we sell our products directly
to retailers as well as third party distributors in certain territories. Our
sales are made primarily on a purchase order basis without long-term agreements
or other forms of commitments. The loss of, or significant reduction in sales
to, any of our principal retail customers or distributors could significantly
harm our business and financial results. Our two largest customers, Wal-Mart
Stores, Inc. and Toys "R" Us, Inc., accounted for approximately 14% and 7%,
respectively, of our consolidated net revenues for fiscal 2002. Our five largest
retailers including Wal-Mart and Toys "R" Us,
6
accounted for approximately 35% of our consolidated net revenues for fiscal
2002. Wal-Mart and Toys "R" Us, accounted for approximately 10% and 9%,
respectively, of our consolidated net revenues for fiscal 2001. Our five largest
retailers, including Wal-Mart and Toys "R" Us, accounted for approximately 34%
of our consolidated net revenues for 2001.
We may permit our customers to return our products and to receive pricing
concessions which could reduce our net revenues and results of operations.
We are exposed to the risk of product returns and price protection with
respect to our distributors and retailers. Return policies allow select
distributors and retailers to return defective, shelf-worn and damaged products
in accordance withcommercially reasonable terms, granted. Price protection policies, when granted and
applicable, allow customers a credit against amounts they owe us with respect to
merchandise unsold by them. We may permit product returns from or grant price
protection to our customers under certain conditions. The conditions our
customers must meet to be granted the right to return products or price
protection are, among other things, compliance with applicable payment terms,
delivery to us of weekly inventory and sell-through reports, and consistent
participation in the launches of our premium title releases. We may also
consider other factors, including the facilitation of slow moving inventory and
other market factors. When we offer price protection, we offer it with respect
to a particular product to all of our retail customers; however, only those
customers who meet the conditions detailed above can avail themselves of such
price protection. We also offer a 90-day limited warranty to our end users that
our products will be free from manufacturing defects. Although we maintain a
reserve for returns and price protection, and although we may place limits on
product returns and price protection, we could be forced to accept substantial
product returns and provide price protection to maintain our relationships with
retailers and our access to distribution channels. Product returns and price
protection that exceed our reserves could significantly harm our business and
financial results.
We may be burdened with payment defaults and uncollectible accounts if our
distributors or retailers cannot honor their credit arrangement with us.
Distributors and retailers in the interactive entertainment software
industry have from time to time experienced significant fluctuations in their
businesses, and a number of them have failed. The insolvency or business failure
of any significant retailer or distributor of our products could materially harm
our business and financial results. We typically make sales to most of our
retailers and some distributors on unsecured credit, with terms that vary
depending upon the customer's credit history, solvency, credit limits and sales
history, as well as whether we can obtain sufficient credit insurance. Although
we have insolvency risk insurance to protect against our customers' bankruptcy,
insolvency or liquidation, this insurance contains a significant deductible and
a co-payment obligation, and the policy does not cover all instances of
non-payment. In addition, while we maintain a reserve for uncollectible
receivables, the reserve may not be sufficient in every circumstance. As a
result, a payment default by a significant customer could significantly harm our
business and financial results.
We may not be able to maintain our distribution relationships with key vendors.
Our CD Contact, NBG and CentreSoft subsidiaries distribute interactive
entertainment software and hardware products and provide related services in the
Benelux territories, Germany and the United Kingdom, respectively, and, via
export, in other European territories for a variety of entertainment software
publishers, many of which are our competitors, and hardware manufacturers. These
services are generally performed under limited term contracts. While we expect
to use reasonable efforts to retain these vendors, we may not be successful in
this regard. The cancellation or non-renewal of one or more of these contracts
could significantly harm our business and financial results. Sony and Nintendo
products accounted for approximately 34% and 8%, respectively, of our worldwide
net distribution revenues for fiscal 2002.
7
Our international revenues may be subject to regulatory requirements as well as
currency fluctuations.
Our international revenues have accounted for a significant portion of our
total revenues. International sales and licensing accounted for 49%, 43% and 51%
of our total net revenues in fiscal 2002, 2001 and 2000, respectively. We expect
that international revenues will continue to account for a significant portion
of our total revenues in the future. International sales may be subject to
unexpected regulatory requirements, tariffs and other barriers. Additionally,
foreign sales which are made in local currencies may fluctuate. Presently, we
engage in limited currency hedging activities. Although exposure to currency
fluctuations to date has been insignificant, fluctuations in currency exchange
rates may in the future have a material negative impact on revenues from
international sales and licensing and thus our business and financial results.
Our software may be subject to governmental restrictions or rating systems.
Legislation is periodically introduced at the local, state and federal
levels in the United States and in foreign countries to establish a system for
providing consumers with information about graphic violence and sexually
explicit material contained in interactive entertainment software products. In
addition, many foreign countries have laws that permit governmental entities to
censor the content and advertising of interactive entertainment software. We
believe that mandatory government-run rating systems eventually may be adopted
in many countries that are significant markets or potential markets for our
products. We may be required to modify our products or alter our marketing
strategies to comply with new regulations, which could delay the release of our
products in those countries.
Due to the uncertainties regarding such rating systems, confusion in the
marketplace may occur, and we are unable to predict what effect, if any, such
rating systems would have on our business. In addition to such regulations,
certain retailers have in the past declined to stock some of our products
because they believed that the content of the packaging artwork or the products
would be offensive to the retailer's customer base. While to date these actions
have not caused material harm to our business, we cannot assure you that similar
actions by our distributors or retailers in the future would not cause material
harm to our business.
Our software may be subject to legal claims.
Within the past three years, two lawsuits, Linda Sanders, et al. v. Meow
Media, Inc., et al., United States District Court for the District of Colorado,
and Joe James, et al. v. Meow Media, Inc., et al., United States District Court
for the Western District of Kentucky, Paducah Division, have been filed against
numerous video game companies, including us, by the families of victims who were
shot and killed by teenage gunmen in attacks perpetrated at schools. These
lawsuits allege that the video game companies manufactured and/or supplied these
teenagers with violent video games, teaching them how to use a gun and causing
them to act out in a violent manner. Both lawsuits referenced in this paragraph
have been dismissed and are currently undergoing various stages of the appeals
process. The dismissal of the Joe James lawsuit has been affirmed by the United
States Court of Appeals for the Sixth Circuit. While our general liability
insurance carrier has agreed to defend us in these lawsuits, it is uncertain
whether or not the insurance carrier would cover all or any amounts which we
might be liable for if the lawsuits are not decided in our favor. If either of
the lawsuits are ultimately decided against us and our insurance carrier does
not cover the amounts we are liable for, it could have a material adverse effect on our business, financial condition, results of operations, profitability, cash flows or liquidity financial and financial results. It is possible that similar additional
lawsuits may be filed in the future. Payment of significant claims by insurance
carriers may make such insurance coverage materially more expensive or
unavailable in the future, thereby exposing our business to additional risk.
We may face limitations onimpact our ability to integrate additional acquired
businessessatisfy our obligations in respect of the new notes.
Our subsidiaries will not have any obligation to pay amounts due on the new notes or to find suitable acquisition opportunities.
We intendmake funds available for that purpose. Our subsidiaries may not be able to, pursue additional acquisitionsor may not be permitted to, make distributions or debt repayments to enable us to make payments in respect of companies, propertiesthe new notes. Each such subsidiary is a distinct legal entity and may be subject to legal or contractual restrictions which, under certain circumstances, may limit our ability to obtain cash from them. While under certain circumstances our Credit Agreement and the indentures governing our notes may limit, the ability of our restricted subsidiaries to incur consensual encumbrances that include restrictions on their ability to pay dividends or make other assetsintercompany payments to us, these limitations are subject to certain qualifications and exceptions. In the event that can be purchased or licensed on acceptable terms and which we believe can be operated or exploited profitably. Some of these
8
transactions could be material in size and scope. Whiledo not receive sufficient cash from our subsidiaries, we will continually be searchingunable to make required principal, premium, if any, and interest payments on the new notes.
We may incur substantially more debt, including secured debt, or take other actions which may affect our ability to satisfy our obligations under the new notes.
Although the terms of the indentures governing our notes and the Credit Agreement governing our Credit Facilities restrict our and our restricted subsidiaries' ability to incur additional indebtedness and/or liens, such restrictions are subject to several exceptions and qualifications. Accordingly, our existing debt agreements and the Indenture allow us to incur additional indebtedness, including secured debt. Such additional indebtedness may be substantial. Our ability to recapitalize, incur additional debt and take a number of other actions that are not prohibited by the terms of the new notes could have the effect of diminishing our ability to make payments on the new notes when due, and may also require us to dedicate a substantial portion of our cash flow from operations to payments on our other indebtedness, which would reduce the availability of cash flow to fund our operations, working capital and capital expenditures. In addition, if we incur any additional indebtedness that rankspari passu in right of payment to a series of the new notes, the holders of that debt will be able to share ratably with the holders of such series of the new notes in any proceeds distributed in connection with any insolvency, liquidation, reorganization, dissolution or other winding up of us. If our subsidiaries incur any indebtedness, all of such debt will be structurally senior to the new notes, and the holders of that
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debt will benefit prior to the holders of the new notes in any proceeds distributed in connection with any insolvency, liquidation, reorganization, dissolution or other winding up of any such entity.
Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase.
As of December 31, 2016, after giving effect to this exchange offer, $2.7 billion, or approximately 54% of our total debt, would have been at variable rates of interest. Borrowings under our Credit Facilities are at variable rates of interest and expose us to interest rate risk. If interest rates were to increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for additional acquisition opportunities,servicing our indebtedness, will correspondingly decrease. For every 1.0% increase or decrease in our variable interest rate debt, our estimated annual cash interest expense is expected to change by approximately $27 million. In the future, we may enter into interest rate swaps that involve the exchange of floating for fixed rate interest payments in order to reduce interest rate volatility. However, we may not maintain interest rate swaps with respect to all of our variable rate indebtedness, and any swaps we enter into may not fully mitigate our interest rate risk.
Our credit ratings may not reflect the risks of investing in the new notes.
Our credit ratings are an assessment by rating agencies of our ability to pay our debts when due and include many subjective factors. Consequently, real or anticipated changes in our credit ratings will generally affect the value of the new notes. Also, these credit ratings may not reflect the potential impact of risks relating to structure or marketing of the new notes. Agency ratings are not a recommendation to buy, sell or hold any security and may be successfulrevised or withdrawn at any time by the issuing organization. Each agency's rating should be evaluated independently of any other agency's rating. There can be no assurance that our credit ratings will remain in identifying suitable acquisitions.effect for any given period of time or that such ratings will not be lowered, suspended or withdrawn entirely by a rating agency, if, in that rating agency's judgment, circumstances so warrant. There can also be no assurance that our credit ratings will reflect all of the factors that would be important to holders of the new notes. Actual or anticipated changes or downgrades in our credit ratings, including any announcement that our ratings are under further review for a downgrade, could affect the value of the new notes, may increase our borrowing costs and may negatively impact our ability to incur additional debt. The reports of the rating agencies do not form a part of, and are not incorporated by reference into, this prospectus.
Redemption may adversely affect your return on the new notes.
Each series of the new notes is redeemable at our option, and therefore we may choose to redeem the new notes at times when prevailing interest rates are relatively low. As a result, you may not be able to reinvest the interactive entertainment software
industry continues to consolidate, we face significant competitionproceeds you receive from the redemption in seeking
and consummating acquisition opportunities. a comparable security at an effective interest rate as high as the interest rate on your new notes being redeemed.
We may not be able to consummate
potential acquisitionspurchase the new notes upon the occurrence of a Change of Control Repurchase Event, which would result in a default under the Indenture and would adversely affect our business and financial condition.
Upon the occurrence of a "Change of Control Repurchase Event" within the meaning of the Indenture, each holder of the new notes will have the right to require us to repurchase all or an acquisitionany part of such holder's new notes at 101% of the principal amount thereof plus accrued and unpaid interest, if any, to but excluding the purchase date. We may not enhancehave sufficient funds available to make any required repurchases of the new notes, and we may be unable to receive distributions or advances from our business or may
decrease rather than increase our earnings. Insubsidiaries in the future we may issue
additional securities in connection with one or more acquisitions, which may
dilute our existing shareholders. Future acquisitions could also divert
substantial management time and result in short term reductions in earnings or
special transaction or other charges.sufficient to meet such repurchase obligation. In addition, a change of control may also accelerate obligations to repurchase amounts outstanding under our and our
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subsidiaries' indebtedness and require us (or our subsidiaries), among other things, to make similar offerings in respect of our and their outstanding indebtedness. In addition, restrictions under future debt instruments may not permit us to repurchase the new notes. If we cannot guaranteefail to repurchase new notes in that circumstance, we will be ablein default under the indenture governing the new notes. If, due to successfully integratea default, the businesses thatrepayment of related indebtedness were to be accelerated after any applicable notice or grace periods, we may acquire into
our existing business. Our shareholders may not have sufficient funds to repay such indebtedness or the opportunity to review,
vote on or evaluate future acquisitions.
Our shareholder rights plan, charter documents and other agreementsnew notes. See "Description of the New Notes—Repurchase of Notes upon a Change of Control Repurchase Event."
Some significant restructuring transactions may make it
more difficult to acquire us without the approval of our Board of Directors.
We have adoptednot constitute a shareholder rights plan under which one right entitling
the holder to purchase two three-hundredths of a share of our Series A Junior
Preferred Stock price at an exercise price of $40 per share (subject to
adjustment) is attached to each outstanding share of common stock. Such
shareholder rights plan makes an acquisitionchange of control, in which case we would not be obligated to offer to purchase the new notes.
Upon the occurrence of a transaction not
approved by our BoardChange of Directors more difficult. Our Amended and Restated
By-lawsControl Repurchase Event within the meaning of the Indenture, holders of new notes have advance notice provisions for nominations for election of nomineesthe right to require us to purchase their new notes. However, the Board of Directors which may make it more difficult to acquire control of
us. Our long-term incentive plans provide in many cases for acceleration of
stock options following a change in control, which has the effect of making an
acquisition of control more expensive. In addition, someprovisions will not afford protection to holders of our officers have
severance compensation agreements that provide for substantial cash payments and
accelerations of other benefitsnew notes in the event of certain transactions. For example, transactions such as leveraged recapitalizations, refinancings, restructurings, or acquisitions initiated by us may not constitute a change in control. These
agreements and arrangements may also inhibitof control requiring us to purchase the new notes. Further, various transactions might not constitute a change of control under the new notes but could constitute a change of control as defined under our other debt. In the event of any such transaction, the holders would not have the right to require us to purchase the new notes, even though such transaction could increase the amount of our indebtedness, or otherwise adversely affect our capital structure or any credit ratings, thereby adversely affecting the holders of new notes.
The ability of holders of the new notes to require us to repurchase new notes as a result of a disposition of "substantially all" assets may be uncertain.
The definition of change of control in controlthe Indenture includes a phrase relating to the direct or indirect sale, transfer, conveyance or other disposition of "all or substantially all" of the assets of the Issuer and its restricted subsidiaries, taken as a whole. Although there is a limited body of case law interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, the ability of a holder of new notes to require us to repurchase such new notes as a result of a sale, transfer, conveyance or other disposition of less than all of our assets and the assets of our restricted subsidiaries taken as a whole to another person or group may havebe uncertain.
Trading markets for the new notes may not develop.
The new notes are new issues of securities with no established trading markets. We do not intend to apply for listing of any of the new notes on any national securities exchange or for inclusion of any of the new notes on any automated dealer quotation system.
Therefore, a negative effect onliquid trading market may not develop for any series of the new notes. If a market develops, the new notes of any series could trade at prices that may be lower than the initial offering price of our common stock.
Our stocksuch series of the new notes. Further, if an active market does not develop or is not maintained, the price is highly volatile.
The trading priceand liquidity of our common stock hasany series of the new notes may be adversely affected. Historically, debt markets have been and could continue to be subject to wide fluctuationsdisruptions that have caused substantial volatility in response to certain factors, including:
o Quarter to quarter variations in results of operations
o Our announcements of new products
o Our competitors' announcements of new products
o Our product development or release schedule
o General conditions in the computer, software, entertainment, media or
electronics industries
o Timing of the introduction of new platforms and delays in the actual
release of new platforms
o Changes in earnings estimates or buy/sell recommendations by analysts
o Investor perceptions and expectations regarding our products, plans
and strategic position and those of our competitors and customers
In addition, the public stock markets experience extreme price and trading
volume volatility, particularly in high technology sectors of the market. This
volatility has significantly affected the market prices of securities of many
technology companies for reasons often unrelatedsimilar to the operating performancenew notes. The market, if any, for any series of the specific companies. These broad market fluctuationsnew notes may not be free from similar disruptions and any such disruptions may adversely affect the market priceprices at which holders of our common stock.
9
We do not pay cash dividends on our common stock.
We have not paidnew notes may sell their new notes. In addition, subsequent to their initial issuance, any cash dividends on our common stock and do not
anticipate paying dividends in the near future.
ABOUT ACTIVISION
We are a leading international publisher of interactive entertainment
software products. We have built a company with a diverse portfolio of products
that spans a wide range of categories and target markets and that is used on a
variety of game hardware platforms and operating systems. We have created,
licensed and acquired a group of highly recognizable brands which we market to a
growing variety of consumer demographics.
Our products cover the action/adventure, action sports, racing,
role-playing, simulation, first-person action and strategy game categories. We
offer our products in versions which operate on the Sony PlayStation, Sony
PlayStation 2, Nintendo 64, Nintendo GameCube and Microsoft Xbox console
systems, the Nintendo Game Boy Advance hand held device, as well as on personal
computers. Driven partly by the enhanced capabilitiesseries of the current generation
of platforms, we believe that in the next few years there will be continued
growth innew notes may trade at a discount from their initial offering price, depending upon prevailing interest rates, the market for interactive entertainment softwaresimilar notes, our performance and other factors.
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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
This prospectus contains, or incorporates by reference, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements consist of any statement other than a recitation of historical facts and include, but are not limited to: (1) projections of revenues, expenses, income or loss, earnings or loss per share, cash flow or other financial items; (2) statements of our plans and objectives, including those relating to releases of products or services; (3) statements of future financial or operating performance; and (4) statements of assumptions underlying such statements. Activision Blizzard, Inc. generally uses words such as "outlook," "forecast," "will," "could," "should," "would," "to be," "plan," "plans," "believes," "may," "might," "expects," "intends," "intends as," "anticipates," "estimate," "future," "positioned," "potential," "project," "remain," "scheduled," "set to," "subject to," "upcoming" and other similar expressions to help identify forward-looking statements. Forward-looking statements are subject to business and economic risks, reflect management's current expectations, estimates and projections about our business, and are inherently uncertain and difficult to predict. Our actual results could differ materially from expectations stated in forward-looking statements. Some of the risk factors that could cause our actual results to differ from those stated in forward-looking statements can be found in "Risk Factors" included in Part I, Item 1A of our Annual Report on Form 10 K for the year ended December 31, 2016, as updated by reports and documents we file from time to time with the SEC that are incorporated by reference herein. The forward-looking statements contained herein are based upon information available to us as of the date of this prospectus and we planassume no obligation to leverage our skills and resources to extend our leading position in the
industry.
Our publishing business involves the development, marketing and sale of
products, either directly, by license or through our affiliate label program
with third party publishers. In addition to publishing, we maintain distribution
operations in Europe that provide logistical and sales services to third party
publishers of interactive entertainment software, our own publishing operations
and manufacturers of interactive entertainment hardware.
Our objective isupdate any such forward-looking statements. Although these forward-looking statements are believed to be a worldwide leader in the development, publishing
and distribution of quality interactive entertainment software products that
deliver a highly satisfying consumer entertainment experience. Our strategy
includes the following elements:
Create and Maintain Diversity in Product Mix, Platforms and Markets. We
believe that maintaining a diversified mix of products can reduce our operating
risks and enhance profitability. Therefore, we develop and publish products
spanning a wide range of product categories, including action/adventure, action
sports, racing, role-playing, simulation, first-person action and strategy, and
products designed for target audiences ranging from game enthusiasts and
childrentrue when made, they may ultimately prove to mass market consumers and "value priced" buyers. Presently, we
concentrate on developing, publishing and distributing products that operate on
Sony PlayStation 2, Nintendo GameCube and Microsoft Xbox console systems,
Nintendo Game Boy Advance hand held device and the personal computer. We
typically offer our products for use on multiple platforms in order to reduce
the risks associated with any single platform, leverage our costs over a larger
installed base and increase unit sales.
Create, Acquire and Maintain Strong Brands. We focus development and
publishing activities principally on products thatbe incorrect. These statements are or have the potential to
become, franchise properties with sustainable consumer appeal and brand
recognition. These products can thereby serve as the basis for sequels, prequels
and related new products that can be released over an extended period of time.
We believe that the publishing and distribution of products based in large part
on franchise properties enhances predictability of revenues and the probability
of high unit volume sales and operating profits. We have entered into a series
of strategic relationships with the owners of intellectual property pursuant to
which we have acquired the rights to publish products based on franchises such
as Star Trek, various Disney films such as Toy Story 2 and Marvel Comics'
properties such as Spider Man, X Men, Blade, Iron Man and Fantastic Four. We
have also capitalized on the successnot guarantees of our Tony Hawk's Pro Skater productsfuture performance and are subject to sign long term agreements, manyrisks, uncertainties and other factors, some of which are exclusive, with numerous other
action-sports athletes including superstars Mat Hoffman in BMX biking, Kelly
Slater in surfing, Shaun Palmer in snowboarding, Shaun Murray in wakeboardingbeyond our control and Travis Pastrana in motorcross bikingmay cause actual results to differ materially from current expectations.
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USE OF PROCEEDS
We will not receive any proceeds from the exchange offer. Any old notes that are properly tendered and establish the "Activision O2" brand
as the dominant brand in the action-sports category.
10
Enforce Disciplined Product Selection and Development Processes. The
success of our publishing business depends, in significant part, on our ability
to develop games that will generate high unit volume sales and that can be
completed up to our high quality standards. Our publishing units have
implemented a formal control process for the selection, development, production
and quality assurance of our products. We apply this process, which we refer to
as the "Greenlight Process," to products under development with external, as
well as internal resources. The Greenlight Process includes in depth reviews of
each project at five intervals during the development process by a team that
includes several of our highest ranking operating managers and coordination
between our sales and marketing personnel and development staff at each step in
the process.
We develop our products using a strategic combination of our internal
development resources and external development resources acting under contract
with us, some of who are independent and in some of which we have a capital
investment. We typically select our external developers based on their track
record and expertise in producing products in the same category. One developer
will often produce the same game for multiple platforms and will produce sequelsexchanged pursuant to the original game. We believe that this selection process allows us to
strengthen and leverage the particular expertise of our internal and external
development resources.
Continue to Improve Profitability. We are continually striving to reduce
our risk and increase our operating leverage and efficiency with the goal of
increased profitability. We believe the key factor affecting our profitabilityexchange offer will be the success rateretired and cancelled.
Table of our product releases. Therefore, our product
selection and development process includes, as a significant component, periodic
evaluations of the expected commercial success of products under development.
Through this process, titles that we determine to be less promising are either
discontinued before we incur additional development costs, or if necessary,
corrections can be made in the development process. In addition, our focus on
cross platform releases and branded products will, we believe, contribute to
this strategic goal.
In order to further our emphasis on improved profitability, we have
implemented a number of operational initiatives. We have increased our product
development capabilities by allocating a portion of our product development
investments to experienced independent development companies working under
contract with us, thereby taking advantage of specialized third party developers
without incurring the fixed overhead obligations associated with increased
internally employed staff. Additionally, we have acquired certain experienced
and specialized developers when, in our opinion, we can enhance profitability
through the elimination of royalty obligations. Our sales and marketing
operations work with our studio resources to increase the visibility of new
product launches and to coordinate timing and promotion of product releases. Our
finance and administration and sales and marketing personnel work together to
improve inventory management and accounts receivables collections. We have
broadly instituted objective based reward programs that provide incentives to
management and staff throughout the organization to produce results that meet
our financial objectives.
Grow Through Continued Strategic Acquisitions and Alliances. The
interactive entertainment industry is consolidating, and we believe that success
in this industry will be driven in part by the ability to take advantage of
scale. Specifically, smaller companies are more capital constrained, enjoy less
predictability of revenues and cash flow, lack product diversity and must spread
fixed costs over a smaller revenue base. Several industry leaders are emerging
that combine the entrepreneurial and creative spirit of the industry with
professional management, the ability to access the capital markets and the
ability to maintain favorable relationships with strategic developers, property
owners and retailers. Through 14 completed acquisitions since 1997, we believe
that we have successfully diversified our operations, our channels of
distribution, our development talent pool and our library of titles, and have
emerged as one of the industry's leaders. We intend to continue to expand our
resources through acquisitions, strategic relationships and key license
transactions. We expect to focus our acquisition strategy on increasing our
development capacity through the acquisition of or investment in selected
experienced development firms, and expanding our intellectual property library
through licenses and strategic relationships with intellectual property owners.
11
RATIOSContents
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our unaudited historical ratiosratio of earnings to fixed charges for the periods indicated below:
Six Months
Year Ended March 31, Ended September 30,
--------------------------- -------------------
1998 1999 2000 2001 2002 2001 2002
Ratio ofpresented.
| | | | | | | | | | | | | | | | |
| | Year Ended December 31, | |
|---|
| | 2012 | | 2013 | | 2014 | | 2015 | | 2016 | |
|---|
Ratio of Earnings to Fixed Charges | | | 113.2 | | | 20.1 | | | 5.4 | | | 6.2 | | | 5.5 | (1) |
- (1)
- Total earnings used to
fixed
charges....... 3.48 4.66 A 4.00 28.95 2.73 27.51
A Due to the loss in fiscal year 2000, the ratio coverage was less than 1:1.
Additional earnings of $38.6 million must be generated to achieve coverage
of 1:1.
In calculatingcalculate the ratio of earnings to fixed charges in 2016 includes $92 million loss on extinguishment of debt recognized during 2016 a result of the extinguishment of certain term loan and senior note facilities through the Company's refinancing activities, comprised of a premium payment of $63 million and write-off of unamortized discount and financing costs of $29 million. The loss on extinguishment of debt was not included in the fixed charges.
For purposes of computing the ratios of earnings consist ofto fixed charges, earnings represent income (loss) from continuing operations before loss from equity investees, income taxes and extraordinary items, plus fixed charges.charges less interest capitalized. Fixed charges consist of interest expense, amortized premiums, discounts and rental expense representativecapitalized expenses related to indebtedness, interest capitalized and a reasonable approximation of the interest factor.
As we have no preferred stock issued, a ratiocomponent of earningsoperating lease expense.
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THE EXCHANGE OFFER
Terms of the Exchange Offer; Period for Tendering Old Notes
Subject to combined fixed
chargesterms and preferred dividends is not presented.
USE OF PROCEEDS
This prospectus relates to securities that may be offered and issued by us
from time to timeconditions detailed in connection with the acquisition of various assets,
businesses or securities. Other than the assets, business, or securities
acquired, there usually will be no proceeds to us from these offerings. When
this prospectus is used by a selling security holder in a public reoffering or
resale of securities acquired pursuant to this prospectus, we will usuallyaccept for exchange old notes which are properly tendered on or prior to the expiration date and not receivewithdrawn as permitted below. As used herein, the term "expiration date" means 5:00 p.m., New York City time, on , 2017. We may, however, in our sole discretion, extend the period of time during which the exchange offer is open with respect to one or both series of the old notes. The term "expiration date" means the latest time and date to which the exchange offer is extended.
As of the date of this prospectus, $650,000,000 aggregate principal amount of old 2021 Notes and $850,000,000 aggregate principal amount of the old 2026 Notes are outstanding.
We expressly reserve the right, at any proceeds fromtime, to extend the period of time during which the exchange offer is open with respect to one or both series of the old notes, and delay acceptance for exchange of any such saleold notes, by giving oral or written notice of such extension to the holders thereof as described below. During any such extension, all old notes of such series previously tendered will remain subject to the exchange offer and may be accepted for exchange by us. Any old notes not accepted for exchange for any reason will be returned without expense to the tendering holder as promptly as practicable after the expiration or termination of the exchange offer.
Old notes tendered in the exchange offer must be in denominations of principal amount of $2,000 and integral multiples of $1,000 in excess of $2,000.
We expressly reserve the right to amend or terminate the exchange offer, and not to accept for exchange any old notes with respect to one or both series of such old notes, upon the occurrence of any of the events specified under "—Conditions to the Exchange Offer." We will give oral or written notice of any extension, amendment, non-acceptance or termination to the holders of the applicable old notes as promptly as practicable. Such notice, in the case of any extension, will be issued by means of a press release or other public announcement no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.
Exchange Offer Procedures
The tender to us of old notes by you as set forth below and our acceptance of the old notes will constitute a binding agreement between us and you upon the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal. Except as set forth below, to tender old notes for exchange pursuant to the exchange offer, you must transmit a properly completed and duly executed letter of transmittal, including all other documents required by such letter of transmittal or, in the case of a book-entry transfer, an agent's message in lieu of such letter of transmittal, to Wells Fargo Bank, National Association, as exchange agent, at the address set forth below under "—Exchange Agent" on or prior to the expiration date. In addition, either:
- •
- certificates for such old notes must be received by the
selling security holder. However, any
proceedsexchange agent along with the letter of transmittal; or
- •
- a timely confirmation of a book-entry transfer, which we refer to as a book-entry confirmation, of such old notes, if such procedure is available, into the exchange agent's account at DTC pursuant to the procedure for book-entry transfer must be received by
usthe exchange agent, prior to the expiration date, with the letter of transmittal or an agent's message in lieu of such letter of transmittal.
The term "agent's message" means a message, transmitted by DTC to and received by the exchange agent and forming a part of a book-entry confirmation, which states that DTC has received an express acknowledgment from the offeringtendering participant stating that such participant has received
Table of securities pursuantContents
and agrees to this
prospectusbe bound by the letter of transmittal and that we may enforce such letter of transmittal against such participant. The method of delivery of old notes, letters of transmittal and all other required documents is at your election and risk. If such delivery is by mail, it is recommended that you use registered mail, properly insured, with return receipt requested. In all cases, you should allow sufficient time to assure timely delivery. No letter of transmittal or uponold notes should be sent to us.
Signatures on a letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed unless the old notes surrendered for exchange are tendered:
- •
- by a holder of the old notes who has not completed the box entitled "Special Issuance Instructions" or "Special Delivery Instructions" on the letter of transmittal, or
- •
- for the account of an eligible institution (as defined below).
In the event that signatures on a letter of transmittal or a notice of withdrawal are required to be guaranteed, such guarantees must be by a firm which is a member of the Securities Transfer Agent Medallion Program, the Stock Exchanges Medallion Program or the New York Stock Exchange Medallion Program (each such entity being hereinafter referred to as an eligible institution). If old notes are registered in the name of a person other than the signer of the letter of transmittal, the old notes surrendered for exchange must be endorsed by, or be accompanied by a written instrument or instruments of transfer or exchange, in satisfactory form as we or the exchange agent determine in our sole discretion, duly executed by the registered holders with the signature thereon guaranteed by an eligible institution.
We or the exchange agent in our or its sole discretion will make a final and binding determination on all questions as to the validity, form, eligibility (including time of receipt) and acceptance of old notes tendered for exchange. We reserve the absolute right to reject any resaleand all tenders of securitiesany particular old note not properly tendered or to not accept any particular old note which acceptance might, in our judgment or our counsel's, be unlawful. We also reserve the absolute right to waive any defects or irregularities or conditions of the exchange offer as to any particular old note either before or after the expiration date (including the right to waive the ineligibility of any holder who seeks to tender old notes in the exchange offer). Our or the exchange agent's interpretation of the terms and conditions of the exchange offer as to any particular old note either before or after the expiration date (including the letter of transmittal and the instructions thereto) will be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of old notes for exchange must be cured within a reasonable period of time, as we determine. We are not, nor is the exchange agent or any other person, under any duty to notify you of any defect or irregularity with respect to your tender of old notes for exchange, and no one will be liable for failing to provide such notification.
If the letter of transmittal is signed by a person or persons other than the registered holder or holders of old notes, such old notes must be endorsed or accompanied by powers of attorney signed exactly as the name(s) of the registered holder(s) that appear on the old notes and the signatures must be guaranteed by an eligible institution.
If the letter of transmittal or any old notes or powers of attorney are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing. Unless waived by us or the exchange agent, proper evidence satisfactory to us of their authority to so act must be submitted with the letter of transmittal.
By tendering old notes, you represent to us, among other things, that you are not our "affiliate," as defined under Rule 405 under the Securities Act, that the new notes acquired pursuant to thisthe exchange offer are being obtained in the ordinary course of business of the person receiving such new notes, whether or not such person is the holder, that neither the holder nor such other person has any arrangement or understanding with any person to participate in the distribution of the new notes, and
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that you are not holding old notes that have, or are reasonably likely to have, the status of an unsold allotment in the initial offering. In the case of a holder that is not a broker-dealer, that holder, by tendering, will also represent to us that the holder is not engaged in, and does not intend to engage in, a distribution of the new notes. However, any purchaser of old notes who is our affiliate who intends to participate in the exchange offer for the purpose of distributing the new notes or a broker-dealer that acquired old notes in a transaction other than as part of its trading or market-making activities and who has arranged or has an understanding with any person to participate in the distribution of the old notes:
- •
- cannot rely on the applicable interpretations of the staff of the SEC;
- •
- will not be entitled to participate in the exchange offer; and
- •
- must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction.
Each broker-dealer that receives new notes for its own account in exchange for old notes, where such old notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will be used for general corporate purposes, including capital expenditures,
working capital, repayment or reduction of long term and short term debt and the
financing of acquisitions and other business combinations. We may invest funds
that we do not immediately require in marketable securities.
OFFERED SECURITIES
We may issue and sell the securities offered by thisdeliver a prospectus in connection with our acquisition in the future of the assets, business or
securities of other companies whether by purchase, merger, or any other form of
business combination. The specific terms upon which we will issue securities
will be determined by negotiation with the owner(s) or controlling person(s) of
the assets, businesses, or securities we plan to acquire. The securities issued
in each acquisition will be valued at prices which are based upon or reasonably
related to market prices, or our valuation, of the same or similar securities.
Such valuation may occur at the time we agree to the terms of an acquisition,
the time of delivery of our securities, during periods ending at or about such
times based on average market prices, or otherwise.
This prospectus, as amended or supplemented if appropriate, has also been
prepared for use by selling security holders who receive our securities in
acquisitions, including securities received under this prospectus. In general,
the persons to whom we issue securities under this prospectus will be able to
resell our securities in the public market without further registration and
without being required to deliver a prospectus. However, certain persons who
receive large blocks of our securities may want to resell those securities in
distributions that would require the delivery of a prospectus. With our prior
written consent, this prospectus may be used by selling security holders who may
wish to sell securities. As used in this prospectus, "selling security holders"
may include donees and pledgees selling securities received from a selling
security holder. However, no person who receives the
12
securities covered by this prospectus will be authorized to use this prospectus
for an offerresale of such securities without first obtaining our written consent. We
may limit our consent tonew notes. See "Plan of Distribution." The letter of transmittal states that by so acknowledging and by delivering a specified time period and subject to certain
limitations and conditions, which may vary by agreement.
Selling security holders may agree that:
o an offering of securities under this prospectus, be effected in an
orderly manner through securities dealers, acting as broker or dealer,
selected by us;
o theya broker-dealer will enter into custody agreements with one or more banks with
respect to such securities; and
o that they make sales only by one or more of the methods described in
this prospectus, as appropriately supplemented or amended when
required.
Selling security holders may sell securities:
o through the Nasdaq National Market or any national securities exchange
on which our securities have been approved for listing in the future
or otherwise;
o directly to purchasers in privately negotiated transactions;
o by or through brokers or dealers, in ordinary brokerage transactions
or transactions in which the broker solicits purchasers;
o in block trades in which the broker or dealer will attempt to sell
securities as an agent but may position and resell a portion of the
block as principal;
o in transactions in which a broker or dealer purchases as principal for
resale for its own account;
o through underwriters or agents; or
o in any combination of these methods.
Securities may be sold at a fixed offering price, which may be changed, at
the prevailing market price at the time of sale, at prices related to such
prevailing market price or at negotiated prices. Any brokers, dealers,
underwriters or agents may arrange for others to participate in any such
transaction and may receive compensation in the form of discounts, commissions
or concessions from selling security holders and/or the purchasers of
securities. The proceeds to a selling security holder from any sale of
securities will be reduced by any compensation and of any expenses to be borne
by the selling security holder.
If required at the time a particular offer of securities is made by the
Securities Act and the rules of the SEC, a supplement to this prospectus will be
delivered that identifies any persons reselling securities acquired under this
prospectus and will provide information about them and describe any material
arrangements for the distribution of securities and the terms of the offering,
including the names of any underwriters, brokers, dealers or agents and any
discounts, commissions or concessions and other items constituting compensation
from the selling security holder.
Selling security holders and any brokers, dealers, underwriters or agents
that participate with a selling security holder in the distribution of
securities maynot be deemed to be "underwriters"admit that it is an "underwriter" within the meaning of the Securities Act, in which event any discounts, commissionsAct.
Acceptance of Old Notes for Exchange; Delivery of New Notes
Upon satisfaction or concessions
received by any such brokers, dealers,
13
underwriters or agents and any profit on the resalewaiver of all of the securities purchased
by them mayconditions to the exchange offer of a particular series, we will accept, as soon as practicable after the expiration date, all old notes properly tendered and will issue the new notes of such series after acceptance of the old notes. See "—Conditions to the Exchange Offer." For purposes of the exchange offer, we will be deemed to have accepted properly tendered old notes for exchange if and when we give oral (confirmed in writing) or written notice to the exchange agent.
The holder of each old note accepted for exchange will receive a new note in the amount equal to the surrendered old note. Holders of new notes on the relevant record date for the first interest payment date following the consummation of the exchange offer will receive interest accruing from the most recent date to which interest has been paid on the old notes. Holders of new notes will not receive any payment in respect of accrued interest on old notes otherwise payable on any interest payment date, the record date for which occurs on or prior to the consummation of the exchange offer.
In all cases, issuance of new notes for old notes that are accepted for exchange will be underwriting commissionsmade only after timely receipt by the exchange agent of:
- •
- certificates for such old notes or
discountsa timely book-entry confirmation of such old notes into the exchange agent's account at DTC;
- •
- a properly completed and duly executed letter of transmittal or an agent's message in lieu thereof; and
- •
- all other required documents.
If any tendered old notes are not accepted for any reason set forth in the terms and conditions of the exchange offer or if old notes are submitted for a greater principal amount than the holder desires to exchange, such unaccepted or non-exchanged old notes will be returned without expense to the tendering holder (or, in the case of old notes tendered by book entry transfer into the exchange agent's account at DTC pursuant to the book-entry procedures described below, such non-exchanged old notes
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will be credited to an account maintained with DTC as promptly as practicable after the expiration or termination of the exchange offer).
Book-Entry Transfers
For purposes of the exchange offer of a particular series, the exchange agent will request that an account be established with respect to the old notes at DTC within two business days after the date of this prospectus, unless the exchange agent has already established an account with DTC suitable for the exchange offer. Any financial institution that is a participant in DTC may make book-entry delivery of old notes by causing DTC to transfer such old notes into the exchange agent's account at DTC in accordance with DTC's procedures for transfer. Although delivery of old notes may be effected through book-entry transfer at DTC, the letter of transmittal or facsimile thereof or an agent's message in lieu thereof, with any required signature guarantees and any other required documents, must, in any case, be transmitted to and received by the exchange agent at one of the addresses set forth under "—Exchange Agent" on or prior to the expiration date.
Withdrawal Rights
You may withdraw your tender of old notes at any time prior to the applicable expiration date. To be effective, a written notice of withdrawal must be received by the exchange agent at one of the addresses set forth under "—Exchange Agent." This notice must specify:
- •
- the name of the person having tendered the old notes to be withdrawn;
- •
- the old notes to be withdrawn (including the principal amount of such old notes);
- •
- a statement that such person is withdrawing its election to have the old notes exchanged; and
- •
- where certificates for old notes have been transmitted, the name in which such old notes are registered, if different from that of the withdrawing holder.
If certificates for old notes have been delivered or otherwise identified to the exchange agent, then, prior to the release of such certificates, the withdrawing holder must also submit the serial numbers of the particular certificates to be withdrawn and a signed notice of withdrawal with signatures guaranteed by an eligible institution, unless such holder is an eligible institution. If old notes have been tendered pursuant to the procedure for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn old notes and otherwise comply with the procedures of DTC.
We or the exchange agent will make a final and binding determination on all questions as to the validity, form and eligibility (including time of receipt) of such notices. Any old notes so withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer. Any old notes tendered for exchange but not exchanged for any reason will be returned to the holder without cost to such holder (or, in the case of old notes tendered by book-entry transfer into the exchange agent's account at DTC pursuant to the book-entry transfer procedures described above, such old notes will be credited to an account maintained with DTC for the old notes as soon as practicable after withdrawal, rejection of tender or termination of the exchange offer). Properly withdrawn old notes may be retendered by following one of the procedures described under "—Exchange Offer Procedures" above at any time on or prior to the expiration date.
Conditions to the Exchange Offer
Notwithstanding any other provision of the exchange offer of a particular series, we are not required to accept for exchange, or to issue new notes in exchange for, any old notes and may
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terminate or amend the exchange offer, if any of the following events occur prior to acceptance of such old notes:
- (1)
- the applicable exchange offer violates any applicable law or is prohibited by the SEC or applicable interpretations of the staff of the SEC;
- (2)
- there is threatened, instituted or pending any action or proceeding before, or any injunction, order or decree has been issued by, any court or governmental agency or other governmental regulatory or administrative agency or commission,
- •
- seeking to restrain or prohibit the making or consummation of the applicable exchange offer or any other transaction contemplated by the applicable exchange offer, or assessing or seeking any damages as a result thereof, or
- •
- resulting in a material delay in our ability to accept for exchange or exchange some or all of the old notes pursuant to the applicable exchange offer;
- (3)
- any statute, rule, regulation, order or injunction has been sought, proposed, introduced, enacted, promulgated or deemed applicable to the applicable exchange offer or any of the transactions contemplated by the exchange offer by any government or governmental authority, domestic or foreign, or any action has been taken, proposed or threatened, by any government, governmental authority, agency or court, domestic or foreign, that in our sole judgment might, directly or indirectly, result in any of the consequences referred to in clauses (1) or (2) above or, in our reasonable judgment, might result in the holders of new notes having obligations with respect to resales and transfers of new notes which are greater than those described in the interpretation of the SEC referred to on the cover page of this prospectus, or would otherwise make it inadvisable to proceed with the exchange offer; or
- (4)
- there has occurred:
- •
- any general suspension of or general limitation on prices for, or trading in, our securities on any national securities exchange or in the over-the-counter market,
- •
- any limitation by a governmental agency or authority which may adversely affect our ability to complete the transactions contemplated by the applicable exchange offer,
- •
- a declaration of a banking moratorium or any suspension of payments in respect of banks in the United States or any limitation by any governmental agency or authority which adversely affects the extension of credit, or
- •
- a commencement of a war, armed hostilities or other similar international calamity directly or indirectly involving the United States, or, in the case of any of the foregoing existing at the time of the commencement of the exchange offer, a material acceleration or worsening thereof;
which in our reasonable judgment in any case, and regardless of the circumstances (including any action by us) giving rise to any such condition, makes it inadvisable to proceed with the exchange offer and/or with such acceptance for exchange or with such exchange.
The foregoing conditions are for our sole benefit and may be asserted by us regardless of the circumstances giving rise to any condition or may be waived by us in whole or in part at any time in our reasonable discretion. Our failure at any time to exercise any of the foregoing rights will not be deemed a waiver of any such right and each such right will be deemed an ongoing right which may be asserted at any time.
In addition, we will not accept for exchange any old notes tendered, and no new notes will be issued in exchange for any such old notes, if at such time any stop order is threatened or in effect with
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respect to the registration statement, of which this prospectus constitutes a part, or the qualification of the indenture under the Trust Indenture Act.
Exchange Agent
We have appointed Wells Fargo Bank, National Association as the exchange agent for the exchange offer. All executed letters of transmittal should be directed to the exchange agent at the addresses set forth below. Questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal should be directed to the exchange agent addressed as follows:
Wells Fargo Bank, National Association, Exchange Agent
| | |
By Registered or Certified Mail:
Wells Fargo Bank, N.A.
Corporate Trust Operations
MAC N9300-070
600 South Fourth Street
Minneapolis, MN 55402 | | By Regular Mail or Overnight Courier:
Wells Fargo Bank, N.A.
Corporate Trust Operations
MAC N9300-070
600 South Fourth Street
Minneapolis, MN 55402 |
By Facsimile:
(For Eligible Institutions only):
(612) 667-6282 |
|
In Person by Hand Only:
Wells Fargo Bank, N.A.
Corporate Trust Operations
MAC N9300-070
600 South Fourth Street
Minneapolis, MN 55402
|
For Information or Confirmation by Telephone:
(800) 344-5128
DELIVERY OF THE LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF SUCH LETTER OF TRANSMITTAL VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY OF THE LETTER OF TRANSMITTAL.
Fees and Expenses
The principal solicitation is being made by mail by Wells Fargo Bank, National Association, as exchange agent. We will pay the exchange agent customary fees for its services, reimburse the exchange agent for its reasonable out-of-pocket expenses incurred in connection with the provision of these services and pay other registration expenses, including fees and expenses of the trustee under the indenture relating to the new notes, filing fees, blue sky fees and printing and distribution expenses. We will not make any payment to brokers, dealers or others soliciting acceptances of the exchange offer.
Additional solicitation may be made by telephone, facsimile or in person by our and our affiliates' officers and regular employees and by persons so engaged by the exchange agent.
Accounting Treatment
We will record the new notes at the same carrying value as the old notes, as reflected in our accounting records on the date of the exchange. Accordingly, we will not recognize any gain or loss for accounting purposes. The expenses of the exchange offer will be expensed as incurred.
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Transfer Taxes
Holders who tender their old notes for exchange will not be obligated to pay any related transfer taxes, except that holders who instruct us to register new notes in the name of, or request that old notes not tendered or not accepted in the exchange offer be returned to, a person other than the registered tendering holder will be responsible for the payment of any applicable transfer taxes.
Consequences of Exchanging or Failing to Exchange Old Notes
If you do not exchange your old notes for new notes in the exchange offer, your old notes will continue to be subject to the provisions of the indenture relating to the old notes regarding transfer and exchange of the old notes and the restrictions on transfer of the old notes described in the legend on your certificates. These transfer restrictions are required because the old notes were issued under an exemption from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws. In general, the old notes may not be offered or sold unless registered under the Securities Act, except under an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. We do not plan to register the old notes under the Securities Act. ToBased on interpretations by the staff of the SEC, as set forth in no-action letters issued to third parties, we believe that the new notes you receive in the exchange offer may be offered for resale, resold or otherwise transferred without compliance with the registration and prospectus delivery provisions of the Securities Act. However, you will not be able to freely transfer the new notes, and, to the extent described below, you will not be entitled to participate in the exchange offer if:
- •
- you are our "affiliate," as defined in Rule 405 under the Securities Act;
- •
- you are not acquiring the new notes in the exchange offer in the ordinary course of your business;
- •
- you have an arrangement or understanding with any person to participate in the distribution, as defined in the Securities Act, of the new notes you will receive in the exchange offer; or
- •
- you are holding old notes that have, or are reasonably likely to have, the status of an unsold allotment in the initial offering.
We do not intend to request the SEC to consider, and the SEC has not considered, the exchange offer in the context of a similar no-action letter. As a result, we cannot guarantee that the staff of the SEC would make a similar determination with respect to the exchange offer as in the circumstances described in the no action letters discussed above. Each holder, other than a broker-dealer, must acknowledge that it is not engaged in, and does not intend to engage in, a distribution of new notes and has no arrangement or understanding to participate in a distribution of new notes. If you are our affiliate, are engaged in or intend to engage in a distribution of the new notes or have any arrangement or understanding with respect to the distribution of the new notes you will receive in the exchange offer, you may not rely on the applicable interpretations of the staff of the SEC, you will not be entitled to participate in the exchange offer and you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. If you are a participating broker-dealer, you must acknowledge that you will deliver a prospectus in connection with any resale of the new notes. In addition, to comply with state securities laws, the securities covered by this
prospectus will be sold in certain jurisdictions only through registered or
licensed brokers or dealers. In addition, in certain states the securitiesyou may not be sold at alloffer or sell the new notes in any state unless they have been offeredregistered or qualified for sale in those
statesthat state or anyan exemption from the registration or qualification requirement is available.
Weavailable and the selling security holders may agree to indemnify each other
and/or any such brokers, dealers, underwriters or agents against certain civil
liabilities, including liabilities under the Securities Act. We may agree to
reimburse the selling security holders for certain expenses in connection with
the offeringis complied with. The offer and sale of securities.
the new notes to "qualified institutional buyers" (as defined in Rule 144A of the Securities Act) is generally exempt from registration or qualification under state securities laws. We do not plan to register or qualify the sale of the new notes in any state where an exemption from registration or qualification is required and not available.
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DESCRIPTION OF DEBT SECURITIES
We mayTHE NEW NOTES
General
Certain terms used in this description are defined under the subheading "Certain Definitions." In this description, (i) the term"Issuer" refers to Activision Blizzard, Inc. and not to any of its Subsidiaries, and (ii) the terms"we," "our" and"us" each refer to the Issuer and its consolidated Subsidiaries.
The Issuer will issue debt securities either separately, or$650,000,000 aggregate principal amount of new 2.300% Senior Notes due 2021 (the"New 2021 Notes") and $850,000,000 aggregate principal amount of new 3.400% Senior Notes due 2026 (the"New 2026 Notes" and, together with the 2021 Notes, the"New Notes") under an indenture dated as of September 19, 2016 (the"Indenture") among the Issuer, the Guarantors and Wells Fargo Bank, National Association, as trustee (the"Trustee"). This is the same indenture under which the Old Notes were issued. Except as set forth herein, the terms of the New Notes will be substantially identical and include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act. The New 2021 Notes and the New 2026 Notes will be issued under the same Indenture, but will be separate series of notes. As a result, among other things, holders of each series of notes will have separate and independent rights to give notice of a Default or uponto direct the conversionTrustee to exercise remedies in the event of a Default or otherwise. References to the "Old Notes," "Old 2021 Notes" or "Old 2026 Notes" refer to the notes in exchange for other securities. The debt securities may
be our unsecured and unsubordinated obligations or our subordinated obligations.
We usewhich the term "senior debt securities"New Notes are being offered. References to the "Notes" refer to the unsecuredNew Notes and unsubordinated obligations. We use the term "subordinated debt securities"Old Notes, collectively. References to the "2021 Notes" refer to the subordinated obligations. The subordinated debt securities of any
series may be our senior subordinated obligations, subordinated obligations,
junior subordinated obligations or may have such other ranking as is described
inOld 2021 Notes and the relevant prospectus supplement. We may issue any of these types of debt
securities in one or more series.
Our senior debt securities may be issued from timeNew 2021 Notes, collectively. References to time under a senior
debt securities indenture with a trustee to be named in the senior debt
securities indenture. Our subordinated debt securities may be issued from time
to time under a subordinated debt securities indenture with a trustee to be
named in the subordinated debt securities indenture, which will describe the
specific terms of the debt securing series. We use the term "indenture" to"2026 Notes" refer to the senior debt securities indenture or the subordinated debt securities
indenture. We use the term "indentures" to refer both the senior debt securities
indentureOld 2026 Notes and the subordinated debtNew 2026 Notes, collectively. Any Old Notes of a series that remain outstanding after the completion of the exchange offer, together with the New Notes of such series issued in the exchange offer, will be treated as a single class of securities indenture. We useunder the term
"trustee"Indenture and are referred to referin this section as a "series" of Notes.
The following description is only a summary of the material provisions of the Indenture and does not purport to be complete and is qualified in its entirety by reference to the trustee namedprovisions of the Indenture, including the definitions therein of certain terms used below. We urge you to read the Indenture because it, not this description, defines your rights as Holders of the applicable Notes. You may request copies of the Indenture at our address set forth under the heading "Where You Can Find More Information; Incorporation By Reference."
Brief Description of New Notes
The New Notes:
- •
- will be unsecured senior obligations of the Issuer;
- •
- will bepari passu in right of payment with all existing and future senior indebtedness (including the
senior debt securities indenture
or the subordinated debt securities indenture. We use the term "trustees" to
refer to both the trustee named in the senior debt securities indentureSenior Credit Facilities and the subordinated debt securities indenture.
The following summary of selected provisions that will be in indentures and
in the debt securities is not complete. Before making an investment in our debt
securities, you should review the applicable prospectus supplement and the form
of applicable indenture, which will be filed with the Securities and Exchange
Commission in connection with the offering6.125% Senior Notes due 2023 (the"Existing Notes")) of the specific debt securities.
Some of our operations are conducted through our subsidiaries. Accordingly,
our cash flow and our ability to service our debt, including the debt
securities, are dependent upon the earnings of our subsidiaries and the
distribution of those earnings to us, whether by dividends, loans or otherwise.
The payment of dividends and the making of loans and advances to us by our
subsidiaries may be subject to statutory or contractual restrictions, are
contingent upon the earnings of our subsidiaries and are subject to various
business considerations. Our right to receive assets of any of our subsidiaries
upon their liquidation or reorganization (and the consequent right of the
holders of the debt securities to participate in those assets) Issuer;
- •
- will be effectively subordinated to all secured Indebtedness of the
claims of that subsidiary's creditors (including
trade creditors), exceptIssuer to the extent that we are recognized as a creditor of that subsidiary,the value of the assets securing such Indebtedness;
- •
- will be senior in
which case our claims would still be subordinateright of payment to any security interestsfuture Subordinated Indebtedness of the Issuer; and
- •
- will be structurally subordinated to all existing and future Indebtedness and other liabilities of the Issuer's non-Guarantor Subsidiaries.
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Guarantees
Any Restricted Subsidiaries that guarantee the Senior Credit Facilities will be required to Guarantee the Notes. The Guarantors, if any, as primary obligors and not merely as sureties, will jointly and severally irrevocably and unconditionally Guarantee, on an unsecured senior basis, the performance and full and punctual payment when due, whether at maturity, by acceleration or otherwise, of all obligations of the Issuer under the Indenture and the Notes, whether for payment of principal of or interest on the Notes, expenses, indemnification or otherwise, on the terms set forth in the assetsIndenture by executing the Indenture.
Each of the subsidiaryGuarantees of the Notes, if any, will be a general unsecured obligation of each Guarantor, will bepari passu in right of payment with all existing and anyfuture senior indebtedness of each such entity (including the subsidiaryguarantees of the Senior Credit Facilities and the Existing Notes), will be effectively subordinated to all secured Indebtedness of each such entity (to the extent of the value of the assets securing such Indebtedness) and will be senior in right of payment to all existing and future Subordinated Indebtedness of each such entity. The Guarantees will be structurally subordinated to Indebtedness and other liabilities of Subsidiaries of the Issuer that do not Guarantee the Notes.
None of the Issuer's Subsidiaries currently Guarantee the Old Notes and none of the Issuer's Subsidiaries will initially Guarantee the New Notes. In the event of a bankruptcy, liquidation or reorganization of any of these non-Guarantor Subsidiaries, the non-Guarantor Subsidiaries will pay the holders of their debt and their trade creditors before they will be able to distribute or contribute, as the case may be, any of their assets to the Issuer or a Guarantor, if any. As a result, all of the existing and future liabilities of our non-Guarantor Subsidiaries, including any claims of trade creditors, are structurally senior to the Notes. For the year ended December 31, 2016, after intercompany eliminations the subsidiaries accounted for approximately 100% of our total revenue and Adjusted EBITDA. In addition, as of December 31, 2016, our subsidiaries had outstanding approximately $3.3 billion of total liabilities.
The obligations of each Guarantor, if any, under its Guarantees will be limited as necessary to prevent the Guarantees from constituting a fraudulent conveyance under applicable law and therefore, are limited to the amount that held by us.
14
General
We can issue an unlimited amountsuch Guarantor could guarantee without such Guarantee constituting a fraudulent conveyance; this limitation, however, may not be effective to prevent such Guarantee from constituting a fraudulent conveyance.
Any entity that makes a payment under its Guarantee will be entitled upon payment in full of debt securitiesall guaranteed obligations under the indentures.
We can issue debt securities from timeIndenture to time and in one or more series as
determined by us. In addition, we can issue debt securities of any series with
terms different from the terms of debt securities of any other series and the
terms of particular debt securities within any series may differa contribution from each other all without the consentGuarantor in an amount equal to such other Guarantor's pro rata portion of the holders of previously issued series of
debt securities. The debt securities of each series will be our direct,
unsecured obligations.
The applicable prospectus supplement relating to the series of debt
securities will describe the specific terms of the debt securities being
offered, including, where applicable, the following:
o the title of the series of debt securities;
o whether the debt securities of the series will be senior debt
securities or subordinated debt securities;
o any limitsuch payment based on the aggregate principal amountrespective net assets of debt securities ofall the series;
o the name of the trustee and its corporate trust office;
o whether the debt securities of the series are to be issuable in
registered or bearer form or both and whether the debt securities of
the series may be represented initially by a debt security in
temporary or permanent global form, and, if so, the initial depositary
with respect to such temporary or permanent global debt security and
the circumstances under which beneficial owners of interests in any
such temporary or permanent global debt security may exchange such
interests for debt securities of such series of like tenor and of any
authorized form and denomination and the authorized newspapers for
publication of notices to holders of bearer securities;
o any other terms required to establish a series of bearer securities,
including, but not limited to, tax compliance procedures;
o the price or prices at which the debt securities of the series will be
issued;
o the person to whom any interest will be payable on any debt securities
of the series, if other than the person in whose name the debt
security is registered at the close of business on the regular record
date for the payment of interest;
o the date or dates on which the principal of and premium, if any, on
the debt securities of the series is payable or the method or methods,
if any, used to determine those dates;
o the rate or rates at which the debt securities of the series will bear
interest or the method or methods, if any, used to calculate those
rate or rates;
o the date or dates, if any, from which interest on the debt securities
of the series will accrue, or the method or methods, if any, used to
determine those dates;
o the stated maturities of installments of interest, if any, on which
any interest on the debt securities of the series will be payable and
the regular record dates for any interest payable on any debt
securities of the series which are registered securities;
15
o the place or places where and the manner in which the principal of and
premium, if any, and interest, if any, on the debt securities of the
series will be payable and the place or places where the debt
securities of the series may be presented for transfer and, if
applicable, conversion or exchange and the place or places where
notices and demands in respect of the debt securities of the series
may be served on us;
o our right, if any, to redeem the debt securities, and the period or
periods within which, the price or prices at which and the terms and
conditions upon which, the debt securities of the series may be
redeemed, in whole or in part;
o our obligation, if any, to redeem or purchase the debt securities of
the series pursuant to any sinking fund or analogous provisions or at
the option of a holder of such debt securities, the conditions, if
any, giving rise to such obligation, and the period or periods within
which, the price or prices at which and the terms and conditions upon
which, the debt securities of the series shall be redeemed or
purchased, in whole or part, and any provisions for the remarketing of
such debt securities;
o the denominations in which any registered securities of the series are
to be issuable, if other than denominations of $1,000 and any integral
multiple thereof, and the denominations in which any bearer securities
of the series are to be issuable, if other than denominations of
$5,000;
o the currency or currencies, including composite currencies, of payment
of principal or premium, if any, and interest, if any, on the debt
securities of the series, if other than U.S. dollars, and, if other
than U.S. dollars, whether the debt securities of the series may be
satisfied and discharged other than as provided in the applicable
indenture;
o if the amount of payments of principal of, premium, if any, and
interest, if any, on the debt securities of the series is to be
determined by reference to an index, formula or other method, or based
on a coin or currency or currency unit other than that in which the
debt securities of the series are stated to be payable, the manner in
which these amounts are to be determined and the calculation agent, if
any, with respect thereto;
o if other than the principal amount thereof, the portion of the
principal amount of the debt securities of the series which will be
payable upon declaration or acceleration of the maturity thereof
pursuant to an event of default;
o if we agree to pay any additional amounts on any of the debt
securities, and coupons, if any, of the series to any holder in
respect of any tax, assessment or governmental charge withheld or
deducted, the circumstances and procedures under which we will make
these payments, and whether those additional amounts paid by us will
be treated as interest or principal pursuant to the applicable
indenture, and whether we will have the option to redeem these debt
securities rather than pay these additional amounts;
o whether the debt securities of the series are convertible or
exchangeable into other debt or equity securities, and, if so, the
terms and conditions upon which such conversion or exchange will be
effected, including the initial conversion or exchange price or rate
and any adjustments thereto, the conversion or exchange period and
other conversion or exchange provisions;
o whether the debt securities of the series are issuable upon the
conversion or exchange of other debt or equity securities, and, if so,
the terms and conditions upon which the issuance will be effected,
including the time, manner and place for the issuance;
16
o any terms applicable to debt securities of any series issued at an
issue price below their stated principal amount, including the issue
price thereof and the rate or rates at which the original issue
discount will accrue;
o whether the debt securities of the series are to be issued or
delivered (whetherGuarantors at the time of original issuance or atsuch payment determined in accordance with GAAP.
If a Guarantee was rendered voidable, it could be subordinated by a court to all other indebtedness (including guarantees and other contingent liabilities) of the time of
exchange of a temporary securityapplicable Guarantor, and, depending on the amount of such seriesindebtedness, a Guarantor's liability on its Guarantee could be reduced to zero.
A Guarantee by a Guarantor shall provide by its terms that it shall be automatically and unconditionally released and discharged upon:
(1) (a) any sale, exchange or transfer (by merger, consolidation or otherwise) of
(i) the Capital Stock of such Guarantor (including any sale, exchange or transfer), or any
installment of principal or any premium or interest is to be payable
only, upon receipt of certificates or other documents or satisfaction
of other conditions in addition to those specified inafter which the applicable indenture;
o whetherGuarantor is no longer a Restricted Subsidiary, or (ii) all or substantially all the debt securitiesassets of such Guarantor;
(b) the release or discharge of the series, in whole or any specified
part, will not be defeasible pursuant to the applicable indenture and,
if other thanguarantee by an officers' certificate, the manner in which any
election by us to defease the debt securitiessuch Guarantor of the series will be
evidenced;
oSenior Credit Facilities, except a discharge or release by or as a result of payment under such guarantee;
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(c) the proper designation of any deletions from, modifications ofRestricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary; or additions to
(d) the events of
defaultIssuer exercising its legal defeasance option or our covenants with respect to the debt securities of the
series, whether or not these events of default or covenants are
consistent with the events of default or covenants set forth in this
prospectuscovenant defeasance option as described under "Legal Defeasance and any change in the rights of the trusteeCovenant Defeasance" or the requisite holdersIssuer's obligations under the Indenture being discharged in a manner not in violation of the debt securities of the series to declare the
principal amount of that series due and payable pursuant to the
applicable indenture;
o any special United States federal income tax considerations applicable
to the debt securities of the series; and
o any other terms of the debt securitiesIndenture; and
(2) such Guarantor delivering to the Trustee an Officer's Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in the series not inconsistent
with the provisions of the applicable indenture.
The prospectus supplementIndenture relating to any series of subordinated debt
securities being offered will also describe the subordination provisions
applicable to that series, if different from the subordination provisions
described in this prospectus. In addition, the prospectus supplement relating to
a series of subordinated debt will describe our rights, if any, to defer
payments of interest on the subordinated debt securities by extending the
interest payment period.
Debt securities may be issued as original issue discount securities to be
sold at a substantial discount below their principal amount. In the event of an
acceleration of the maturity of any original issue discount security, the amount
payable to the holder upon acceleration will be determined in the manner
described in the applicable prospectus supplement. Special United States federal
tax and other considerations applicable to original issue discount securities
will be described in the applicable prospectus supplement. In addition, special
United States federal tax considerations or other restrictions or terms
applicable to any debt securities to be issued in bearer form, offered
exclusively to non United States holders or denominated in a currency other than
United States dollars will be set forth in the applicable prospectus supplement.such transaction have been complied with.
Ranking
The above is not intended to be an exclusive list of the terms that may be
applicable to any debt securities and we are not limited in any respect in our
ability to issue debt securities with terms different from or in addition to
those described above or elsewhere in this prospectus, provided that the terms
are not inconsistent with the applicable indenture. Any applicable prospectus
supplement will also describe any special provisions for the payment of
additional amounts with respect to the debt securities.
Subordination of Subordinated Debt Securities
Except as otherwise described in the applicable prospectus supplement
relating to a series of subordinated debt securities, the payment of the principal of, premium, if any, and interest on the New Notes and the payment of any subordinated debt securitiesGuarantee will rank juniorpari passu in right of payment with all senior indebtedness of the Issuer or the relevant Guarantor, as the case may be, including the obligations of the Issuer or such Guarantor under the Senior Credit Facilities and the Existing Notes.
The New Notes will be effectively subordinated to all of the existing and future secured Indebtedness of the Issuer and each Guarantor, if any, to the prior payment in fullextent of all seniorthe value of the assets securing such Indebtedness. As of December 31, 2016, after giving effect to the exchange of the New Notes, we would have had $4.9 billion of total indebtedness of which none would have been secured indebtedness. 17
Form, Exchange, RegistrationWe would also have had $250 million of borrowings available under our Revolver, which remains undrawn as of the date hereof.
Paying Agent and TransferRegistrar for the Notes
The debt securities of a series may be issued as registered securities, as
bearer securities (with or without coupons attached) or as both registered
securities and bearer securities. Debt securities of a series may be issuable in
whole or in part in the form ofIssuer will maintain one or more global debt securities, as described
below under " Global Debt Securities." Unless otherwise indicatedpaying agents for the Notes in an
applicable prospectus supplement, registered securitiesMinnesota or New York. The initial paying agent for the Notes will be issuablethe Trustee.
The Issuer will also maintain a registrar with offices in denominations of $1,000 and integral multiples thereof, and bearer securitiesMinnesota or New York. The initial registrar will be issuable in denominations of $5,000.
At the optionTrustee. The registrar will maintain a register reflecting ownership of the holder, subjectNotes outstanding from time to time and will make payments on and facilitate transfer of Notes on behalf of the Issuer.
The Issuer may change the paying agents or the registrars without prior notice to the termsHolders. The Issuer or any of the indenturesits Subsidiaries may act as a paying agent or registrar.
Transfer and the
limitations applicable to global securities described in the applicable
prospectus supplement, the holder of the debt securities of any series can
exchange the debt securities for other debt securities in any authorized
denomination and of like tenor and aggregate principal amount.
Subject to the terms of the indentures and the limitations applicable to
global securities set forth in the applicable prospectus supplement, holders of
the debt securities of any seriesExchange
A Holder may present the debt securities for exchange
or for registration of transfer, duly endorsed or with the form of transfer
endorsed thereon duly executed if so required by us or the security registrar,
at the office of the security registrar or at the office of any transfer agent
designated by us for this purpose. Unless otherwise provided in the debt
securities of any series that the holder presents for transfer or exchange weNotes in accordance with the Indenture. The registrar and the Trustee may require a Holder to furnish appropriate endorsements and transfer documents in connection with a transfer of Notes. Holders will make no service charge for any registration ofbe required to pay all taxes due on transfer. The Issuer is not required to transfer or exchange but weany Note selected for redemption. Also, the Issuer is not required to transfer or exchange any Note for a period of 15 days before a selection of Notes to be redeemed.
Principal, Maturity and Interest
The Issuer will issue $650,000,000 aggregate principal amount of New 2021 Notes and $850,000,000 aggregate principal amount of New 2026 Notes in this offering. The New 2021 Notes will mature on September 15, 2021. The New 2026 Notes will mature on September 15, 2026. The Issuer may require paymentissue additional 2021 Notes ("Additional 2021 Notes") and/or additional 2026 Notes ("Additional 2026 Notes" and, together with the Additional 2021 Notes, the"Additional Notes") from time to time after this
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offering under the Indenture. Each of (i) the 2021 Notes offered by the Issuer and any taxes or other governmental charges.
InAdditional 2021 Notes subsequently issued under the eventIndenture and (ii) the 2026 Notes offered by the Issuer and any Additional 2026 Notes subsequently issued under the Indenture, in each case, will be treated as a single class for all purposes under the Indenture, including waivers, amendments, redemptions and offers to purchase. Unless the context requires otherwise, references to "Notes" for all purposes of the Indenture and this "Description of the New Notes" include any redemption of debt securities of any series, weAdditional Notes that are actually issued;provided that Additional Notes will not be required to:
o issue, registerissued with the transfersame CUSIP, if any, as existing Notes unless such Additional Notes are fungible with existing Notes for U.S. federal income tax purposes.
New 2021 Notes
Interest will accrue on the New 2021 Notes at a rate per annum equal to 2.300% from the Issue Date, or from the most recent date to which interest has been paid or provided for. Interest will be payable semiannually using a 360-day year comprised of or exchange debt securitiestwelve 30-day months in cash to Holders of that
series during a period beginning at the opening of business 15 days
before any selection of debt securities of that series to be redeemed
and endingrecord at the close of business on the dayMarch 1 or September 1 immediately preceding the interest payment date, on March 15 and September 15 of mailing ofeach year, commencing September 15, 2017 (representing the relevant notice of redemption;interest payment date following March 15, 2017, the most recent interest payment date on the Old 2021 Notes).
New 2026 Notes
Interest will accrue on the New 2026 Notes at a rate per annum equal to 3.400% from the Issue Date, or o registerfrom the transfer of,most recent date to which interest has been paid or exchange any debt securities of the
series or portion thereof, called for redemption, except the
unredeemed portion of any being redeemed in part.
Covenants
All covenants, if any, that will apply to a particular series of debt
securitiesprovided for. Interest will be set forthpayable semiannually using a 360-day year comprised of twelve 30-day months in the indenture relatingcash to such seriesHolders of debt
securities.
Payment and Paying Agents
Unless otherwise indicated in an applicable prospectus supplement, payment
of principal of, premium, if any, and interest, if any, on debt securities of
the series will be made at an office of the agency designated by us in
accordance with the applicable indenture, except that at our option, payment of
principal and premium, if any, or interest also may be made by check payable to
payee and mailed to the address of payee as it appears in the debt securities
registrar or by wire transfer to an account maintained by the payee. Unless
otherwise indicated in an applicable prospectus supplement, payment of any
installment of interest on debt securities of a series will be made to the
person in whose name the debt security is registeredrecord at the close of business on the regularMarch 1 or September 1 immediately preceding the interest payment date, on March 15 and September 15 of each year, commencing September 15, 2017 (representing the interest payment date following March 15, 2017, the most recent interest payment date on the Old 2026 Notes).
Mandatory Redemption; Offers to Purchase; Open Market Purchases
The Issuer is not required to make any mandatory redemption or sinking fund payments with respect to the New Notes. However, under certain circumstances, the Issuer may be required to offer to purchase Notes, including the New Notes, as described under the caption "Repurchase of Notes upon a Change of Control Repurchase Event." We may at any time and from time to time purchase Notes through open market purchases, negotiated transactions or otherwise, which may include a consent solicitation.
Optional Redemption
New 2021 Notes
Except as set forth below, the Issuer will not be entitled to redeem the New 2021 Notes at its option prior to August 15, 2021.
At any time prior to August 15, 2021, the Issuer may redeem all or a part of the New 2021 Notes upon not less than 30 nor more than 60 days' prior notice mailed by first-class mail or electronically to the registered address of each Holder or otherwise in accordance with the procedures of The Depository Trust Company ("DTC"), at a redemption price equal to 100% of the principal amount of New 2021 Notes redeemed plus the Applicable Premium as of the date of redemption (the"2021 Notes Redemption Date"), and, without duplication, accrued and unpaid interest, if any, to, but excluding, the 2021 Notes Redemption Date, subject to the rights of Holders on the relevant record date forto receive interest due on the relevant interest payment.
Global Debt Securities
The debt securitiespayment date.
Table of a seriesContents
On and after August 15, 2021, the Issuer may be issued in whole or inredeem the form of
one or more fully registered global securities. A debt security in global form
will be deposited with, or on behalf of, a depositary, which will be
18
identified in an applicable prospectus supplement. Global debt securities are
expected to be deposited with the Depository Trust Company. A global debt
security may be issued in either registered or bearer form and in either
temporary or permanent form. Unless and until a debt security is exchangedNew 2021 Notes, in whole or in part, forupon notice as described under the individual debt security represented thereby,heading "Repurchase at the Option of Holders—Selection and Notice" at a debt
security in global form may notredemption price equal to 100% of the principal amount of the New 2021 Notes to be transferred except as a wholeredeemed, plus accrued and unpaid interest thereon, if any, to, but excluding, the applicable 2021 Notes Redemption Date, subject to the depositary for the debt security or to a nominee or successorright of the depositary.
If any debt securitiesHolders of a series are issuable in global form, the applicable
prospectus supplement will describe the circumstances, if any, under which
beneficial owners of interests in a global debt security may exchange their
interests for definitive debt securities of that series of like tenor and
principal amount in any authorized form and denomination, the manner of payment
of principal of, premium, if any, and interest, if any,record on the global debtrelevant record date to receive interest due on the relevant interest payment date.
The Issuer and its affiliates may acquire New 2021 Notes by means other than a redemption, whether by tender offer, open market purchases, negotiated transactions or otherwise, which may include a consent solicitation, in accordance with applicable securities andlaws, so long as such acquisition does not otherwise violate the specific terms of the depositary arrangement with respectIndenture.
Any redemption of New 2021 Notes or notice of redemption may, at the Issuer's discretion, be subject to any global debt security.
The specific termsone or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of the depositary arrangement with respect to a series
of debt securities will be describedone or more conditions precedent, such notice shall state that, in the prospectus supplement relatingIssuer's discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied (or waived by the Issuer in its sole discretion), or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date so delayed and such redemption provisions may be adjusted to the series. We anticipate that the following provisions will generally apply to
depositary arrangements.
Upon the issuance of a global security, the depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the debt securities represented by such global security to the accounts of
institutions or persons, commonly known as participants, that have accountscomply with the depositary or its nominee.requirements of any depositary.
The accountsTrustee shall select the 2021 Notes to be credited will be designated bypurchased in the underwriters, dealers or agents. Ownershipmanner described under "Repurchase of beneficial interests inNotes upon a global security will be limited to participants or persons that may hold
interests through participants. OwnershipChange of interests in such global security
will be shown on,Control Repurchase Event—Selection and the transfer of those ownership interests will be effected
only through, records maintained by the depositary (with respect to
participants' interests) and such participants (with respect to the owners of
beneficial interests in such global security). The laws of some jurisdictions
may require that certain purchasers of securities take physical delivery of the
securities in definitive form. These limits and laws may impair the ability to
transfer beneficial interests in a global security.
So long as the depositary, or its nominee, is the registered holder and
owner of such global security, the depositary or such nominee, as the case may
be, will be considered the sole owner and holder for all purposes of the debt
securities and for all purposes under the applicable indenture.Notice."
New 2026 Notes
Except as set forth below, or as otherwise provided in the applicable prospectus supplement,
owners of beneficial interests in a global securityIssuer will not be entitled to haveredeem the debt securities representedNew 2026 Notes at its option prior to June 15, 2026.
At any time prior to June 15, 2026, the Issuer may redeem all or a part of the New 2026 Notes upon not less than 30 nor more than 60 days' prior notice mailed by such global securityfirst-class mail or electronically to the registered address of each Holder or otherwise in their
names, will not receive or be entitled to receive physical delivery of debt
securities in definitive form and will not be considered to be the owners or
holders of any debt securities under the applicable indenture or such global
security. Accordingly, each person owning a beneficial interest in a global
security must rely onaccordance with the procedures of the depositary and, if such person is
notThe Depository Trust Company, at a participant, on the proceduresredemption price equal to 100% of the participant through which such
person owns its interest, to exercise any rights of a holder of debt securities
under the applicable indenture of such global security. We understand that under
existing industry practice, in the event we request any action of holders of
debt securities or if an owner of a beneficial interest in a global security
desires to take any action that the depositary, as the holder of such global
security is entitled to take, the depositary would authorize the participants to
take such action, and that the participants would authorize beneficial owners
owning through such participants to take such actions or would otherwise act
upon the instructions of beneficial owners owning through them.
Payments of principal of and premium, if any, and interest, if any, on debt
securities represented by a global security will be made to the depositary or
its nominee, as the case may be, as the registered owner and holder of such
global security, against surrender of the debt securities at the principal
corporate trust office of the trustee. Interest payments will be made at the
principal corporate trust office of the trustee or by a check mailed to the
holder at its registered address. Payment in any other manner will be specified
in the prospectus supplement.
We expect that the depositary, upon receipt of any payment of principal,
premium, if any, of interest, if any, in respect of a global security, will
credit immediately participants' accounts with payments in amounts proportionate
to their respective beneficial interests in the principal amount of such global
securityNew 2026 Notes redeemed plus the Applicable Premium as shownof the date of redemption (the"2026 Notes Redemption Date") and, without duplication, accrued and unpaid interest, if any, to, but excluding, the 2026 Notes Redemption Date, subject to the rights of Holders on the records ofrelevant record date to receive interest due on the depositary. We expect that payments by
participants to owners of beneficial interests in a global security held
19
through such participants will be governed by standing instructionsrelevant interest payment date.
On and customary practices, as is nowafter June 15, 2026, the case with securities held forIssuer may redeem the accounts of
customers in bearer form or registered in 'street name,' and will be the
responsibility of such participant. We are not responsible or liable (and
neither is the trustee or our agent) for any aspect of the records relating to,
or payments made on account of, beneficial ownership interests in a global
security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests or for any other aspect of the relationship
between the depositary and its participants or the relationship between such
participants and the owners of beneficial interests in such global security
owning through such participants.
Unless and until it is exchangedNew 2026 Notes, in whole or in part, for debtupon notice as described under the heading "Repurchase at the Option of Holders—Selection and Notice" at a redemption price equal to 100% of the principal amount of the New 2026 Notes to be redeemed, plus accrued and unpaid interest thereon, if any, to, but excluding, the applicable 2026 Notes Redemption Date, subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date.
The Issuer and its affiliates may acquire New 2026 Notes by means other than a redemption, whether by tender offer, open market purchases, negotiated transactions or otherwise, which may include a consent solicitation, in accordance with applicable securities laws, so long as such acquisition does not otherwise violate the terms of the Indenture.
Any redemption of New 2026 Notes or notice of redemption may, at the Issuer's discretion, be subject to one or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in definitive form, a global securitythe Issuer's discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied (or waived by the Issuer in its sole discretion), or such redemption may not occur and such notice may be transferred except as a whole
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rescinded in the event that any or all such conditions shall not have been satisfied by the depositaryredemption date, or by the redemption date so delayed and such redemption provisions may be adjusted to comply with the requirements of any depositary.
The Trustee shall select the 2026 Notes to be purchased in the manner described under "Repurchase of Notes upon a Change of Control Repurchase Event—Selection and Notice."
Repurchase of Notes upon a Change of Control Repurchase Event
Change of Control
The Notes will provide that if a Change of Control Repurchase Event occurs after the Issue Date, unless the Issuer has previously or concurrently mailed a redemption notice with respect to all the outstanding Notes as described under "Optional Redemption," the Issuer will make an offer to purchase all of the Notes pursuant to the offer described below (the"Change of Control Offer") at a price in cash (the"Change of Control Payment") equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to, but excluding, the date of purchase, subject to the right of Holders of the Notes of record on the relevant record date to receive interest due on the relevant interest payment date. Within 30 days following any Change of Control Repurchase Event, the Issuer will send notice of such Change of Control Offer by first-class mail or electronically, with a copy to the Trustee, to each Holder of Notes to the address of such Holder appearing in the security register with a copy to the Trustee or otherwise in accordance with the procedures of The Depository Trust Company, with the following information:
(1) that a Change of Control Offer is being made pursuant to the covenant entitled "Change of Control," and that all Notes properly tendered pursuant to such Change of Control Offer will be accepted for payment by the Issuer;
(2) the purchase price and the purchase date, which will be no earlier than 30 days nor later than 60 days from the date such notice is mailed, unless the Change of Control Offer is conditional on the occurrence of the related Change of Control (the"Change of Control Payment Date");
(3) that any Note not properly tendered will remain outstanding and continue to accrue interest;
(4) that unless the Issuer defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest on the Change of Control Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to a nomineeChange of Control Offer will be required to surrender such Notes, with the form entitled "Option of Holder to Elect Purchase" on the reverse of such depositary or by a nominee of such
depositaryNotes completed, to such depositary or another nominee of such depositary.
Unless otherwise providedthe paying agent specified in the notice at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date. Notes held in book entry form shall be purchased in accordance with DTC's applicable prospectus supplement, debt
securities represented by a global securityprocedures;
(6) that Holders will be exchangeableentitled to withdraw their tendered Notes and their election to require the Issuer to purchase such Notes,provided that the paying agent receives, not later than the close of business on the 30th day following the date of the Change of Control Repurchase Event notice, facsimile transmission or letter setting forth the name of the Holder of the Notes, the principal amount of Notes tendered for debt
securitiespurchase, and a statement that such Holder is withdrawing its tendered Notes and its election to have such Notes purchased. Notes held in definitivebook entry form shall be withdrawn in accordance with DTC's applicable procedures;
Table of like tenor asContents
(7) that if the Issuer is redeeming less than all of the Notes, the Holders of the remaining Notes will be issued new Notes and such global securitynew Notes will be equal in denominationsprincipal amount to the unpurchased portion of $1,000 and in any greater amount that isthe Notes surrendered. The unpurchased portion of the Notes must be equal to $2,000 or an integral multiple thereof if:
oof $1,000 in excess thereof;
(8) if such notice is delivered prior to the depositary notifies usoccurrence of a Change of Control, stating that the Change of Control Offer is conditional on the occurrence of such Change of Control, and if applicable, shall state that, in the trusteeIssuer's discretion, the Change of Control Payment Date may be delayed until such time as the Change of Control shall occur, or that it is unwillingsuch redemption may not occur and such notice may be rescinded in the event that the Issuer shall determine that such condition will not be satisfied by the Change of Control Payment Date or unable to continueby the Change of Control Payment as depositary for such global security or if at any
timeso delayed; and
(9) the depositary ceases to beother instructions, as determined by the Issuer, consistent with the covenant described hereunder, that a clearing agency registeredHolder must follow.
The Issuer will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of Notes pursuant to a successor depositary isChange of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of the Indenture, the Issuer will comply with the applicable securities laws and regulations and shall not appointed by us
within 90 days;
o we, in our sole discretion, determine notbe deemed to have breached its obligations described in the Indenture by virtue thereof.
On the Change of Control Payment Date, the Issuer will, to the extent permitted by law,
(1) accept for payment all Notes issued by it or portions thereof properly tendered pursuant to the Change of the debt
securities represented by a global security and notify the trustee
thereof; or
o there shall have occurred and be continuing an event of default or an
event which,Control Offer,
(2) no later than 11:00 A.M. (Eastern time) deposit with the givingpaying agent an amount equal to the aggregate Change of noticeControl Payment in respect of all Notes or lapseportions thereof so tendered, and
(3) deliver, or cause to be delivered, to the Trustee for cancellation the Notes so accepted together with an Officer's Certificate to the Trustee stating that such Notes or portions thereof have been tendered to and purchased by the Issuer.
The Senior Credit Facilities and future credit agreements, indentures or other agreements relating to senior indebtedness to which the Issuer becomes a party may provide that certain change of time, or both,
would constitute an event of defaultcontrol events with respect to the debt
securities.
Any debt securityIssuer would constitute a default thereunder (including a Change of Control under the Indenture). If we experience a change of control that is exchangeable pursuanttriggers a default under our Senior Credit Facilities, we could seek a waiver of such default or seek to refinance our Senior Credit Facilities. In the event we do not obtain such a waiver or refinance the Senior Credit Facilities, such default could result in amounts outstanding under our Senior Credit Facilities being declared due and payable.
Our ability to pay cash to the preceding sentence
is exchangeable for debt securities registered in such names asHolders of Notes following the depositary
shall instruct the trustee. It is expected that such instructionsoccurrence of a Change of Control Repurchase Event may be based
upon directions receivedlimited by our then-existing financial resources. Therefore, sufficient funds may not be available when necessary to make any required repurchases.
The Change of Control purchase feature of the depositary from its participants with respectNotes may in certain circumstances make more difficult or discourage a sale or takeover of us and, thus, the removal of incumbent management. The Change of Control purchase feature is a result of negotiations between the initial purchasers and us. We have no present intention to ownershipengage in a transaction involving a Change of beneficial interestsControl after the Issue Date, although it is possible that we could decide to do so in such global security.the future. Subject to the foregoing,limitations discussed below, we could, in the future, enter into certain transactions, including acquisitions, refinancings or other recapitalizations, that would not constitute a global security is not exchangeable except for a global securityChange of Control under the
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Indenture, but that could increase the amount of indebtedness outstanding at such time or global securitiesotherwise affect our capital structure or credit ratings. Restrictions on our ability to incur additional Indebtedness are contained in the covenants described under "Certain Covenants—Liens" and "Certain Covenants—Sale and Lease-Back Transactions." Such restrictions in the Indenture can be waived only with the consent of the same aggregate denominations to be registeredHolders of a majority in principal amount of the Notes then outstanding. Except for the limitations contained in such covenants, however, the Indenture does not contain any covenants or provisions that may afford Holders of the Notes protection in the nameevent of a highly leveraged transaction.
We will not be required to make a Change of Control Offer following a Change of Control Repurchase Event if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by us and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. Notwithstanding anything to the contrary herein, a Change of Control Offer may be made in advance of a Change of Control, conditional upon such Change of Control, if a definitive agreement is in place for the Change of Control at the time of making of the depositary or its nominee.
EventsChange of Default
Unless otherwise indicated in an applicable prospectus supplement, each
indenture will provide that if an event of default occurs and is continuing with
respect to a series of debt securities, the trustee or the holdersControl Offer.
If Holders of not less than 25%90% in aggregate principal amount of the outstanding Notes validly tender and do not withdraw such Notes in a Change of Control Offer and the Issuer, or any third party making a Change of Control Offer in lieu of the Issuer as described above, purchases all of the Notes validly tendered and not withdrawn by such Holders, the Issuer or such third party will have the right, upon not less than 15 days nor more than 60 days' prior notice,provided that such notice is given not more than 30 days following such purchase pursuant to the Change of Control Offer described above, to redeem all Notes that remain outstanding following such purchase on a date (the"Second Change of Control Payment Date") at a price in cash equal to the applicable Change of Control Payment in respect of the Second Change of Control Payment Date.
The definition of "Change of Control" includes a disposition of all or substantially all of the assets of the Issuer to any Person. Although there is a limited body of case law interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, in certain circumstances there may be a degree of uncertainty as to whether a particular transaction would involve a disposition of "all or substantially all" of the assets of the Issuer. As a result, it may be unclear as to whether a Change of Control has occurred and whether a Holder of Notes may require the Issuer to make an offer to repurchase the Notes as described above.
The provisions under the Indenture relative to the Issuer's obligation to make an offer to repurchase the Notes as a result of a Change of Control Repurchase Event may be waived or modified with the written consent of the Holders of a majority in principal amount of the Notes, whether or not a Change of Control has occurred.
Selection and Notice
If the Issuer is redeeming less than all of the 2021 Notes and/or 2026 Notes at any time, the Trustee will select the Notes of such series to be redeemed (a) if such series of Notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which such series of Notes are listed, (b) on a pro rata basis to the extent practicable or (c) by lot or such other similar method in accordance with the procedures of The Depository Trust Company;provided that no Notes of $2,000 or less shall be redeemed or repurchased in part.
Notices of purchase or redemption shall be mailed by first-class mail, postage prepaid, or otherwise in accordance with the procedures of The Depository Trust Company, at least 30 days but not more than 60 days before the purchase or redemption date to each Holder of the applicable series of Notes at such Holder's registered address, except that redemption notices may be mailed more than 60 days
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prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction and discharge of the Indenture. If any Note is to be purchased or redeemed in part only, any notice of purchase or redemption that relates to such Note shall state the portion of the principal amount thereof that has been or is to be purchased or redeemed.
The Issuer will issue a new Note in a principal amount equal to the unredeemed portion of the original Note in the name of the Holder upon cancellation of the original Note. Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on Notes or portions of them called for redemption.
Certain Covenants
Set forth below are summaries of certain covenants that are contained in the Indenture.
Liens
The Issuer will not, and will not permit any Guarantor to, directly or indirectly, create, incur or assume any Lien (except Permitted Liens) that secures obligations under any Indebtedness or any related guarantee, on any asset or property of the Issuer or any Guarantor unless:
(1) in the case of Liens securing Subordinated Indebtedness, the Notes and related Guarantees are secured by a Lien on such property or assets that is senior in priority to such Liens; or
(2) in all other cases, the Notes or the Guarantees are equally and ratably secured.
The foregoing shall not apply to (a) Liens securing the Notes and the related Guarantees and (b) Liens securing other Indebtedness;provided that, after giving effect to the incurrence of such Indebtedness and any substantially concurrent retirement of any Indebtedness secured by Liens (other than Permitted Liens), the aggregate principal amount of all such Indebtedness secured by Liens pursuant to this subclause (b), together with all attributable debt outstanding pursuant to the second paragraph of the "—Limitation on Sale and Lease-Back Transactions" covenant described below, does not exceed 7.5% of the Issuer's Consolidated Total Assets.
Any Lien created for the benefit of the Holders of the Notes pursuant to this covenant shall be deemed automatically and unconditionally released and discharged upon the release and discharge of the applicable Lien described in clauses (1) and (2) above without any further action on the part of the Holders.
Limitation on Sale and Lease-Back Transactions
The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, enter into any Sale and Lease-Back Transaction with another Person (other than with the Issuer or the Restricted Subsidiaries) unless:
(1) such Sale and Lease-Back Transaction was entered into prior to the Issue Date;
(2) such Sale and Lease-Back Transaction involves a lease for not more than three years (or which may be terminated by the Issuer or the applicable Restricted Subsidiary within a period of not more than three years);
(3) the Lien securing the Indebtedness with respect to such Sale and Lease-Back Transaction is a Permitted Lien; or
(4) the Issuer or the applicable Restricted Subsidiary applies an amount equal to the net proceeds from the sale of such property to the purchase of other property or assets used or useful in the business of the Issuer or its Restricted Subsidiaries or to the retirement of Indebtedness that
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ispari passu in right of payment with the Notes (including the Notes) within 365 days before or after the effective date of any such Sale and Lease-Back Transaction;provided that, in lieu of applying such amount to the retirement ofpari passu Indebtedness, the Issuer may deliver Notes to the Trustee for cancellation, such Notes to be credited at the cost thereof to the Issuer.
Notwithstanding the restrictions set forth in the preceding paragraph, the Issuer and its Restricted Subsidiaries may enter into any Sale and Lease-Back Transaction which would otherwise be subject to the foregoing restrictions if, after giving effect thereto, the aggregate amount of all attributable debt with respect to all such Sale and Lease-Back Transactions (not including attributable debt with respect to Sale and Lease-Back Transactions permitted under clauses (1) through (4) above), together with all Indebtedness secured by a Lien outstanding pursuant to the second paragraph of the "—Liens" covenant described above, does not exceed 7.5% of the Issuer's Consolidated Total Assets.
Merger, Consolidation or Sale of All or Substantially All Assets
The Issuer may not consolidate or merge with or into or wind up into (whether or not such Person is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions, to any Person unless:
(1) the Issuer is the surviving Person or the Person formed by or surviving any such consolidation or merger (if other than the Issuer) or the Person to whom such sale, assignment, transfer, lease, conveyance or other disposition will have been made is organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof (such Person, as the case may be, being herein called the"Successor Company");
(2) the Successor Company, if other than the Issuer, expressly assumes all the obligations of the Issuer under the Indenture and the Notes pursuant to supplemental indentures or other documents or instruments in form reasonably satisfactory to the Trustee;
(3) immediately after such transaction, no Default exists; and
(4) the Issuer shall have delivered to the Trustee an Officer's Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indentures, if any, comply with the Indenture and constitutes the legal, valid and binding obligation of the Issuer enforceable against it in accordance with its terms..
The Successor Company will succeed to, and be substituted for, the Issuer under the Indenture, the Guarantees and the Notes, as applicable, and except in the case of a lease, the Issuer will automatically be released and discharged from its obligations under the Indenture and the Notes. Notwithstanding the foregoing:
(1) any Restricted Subsidiary may consolidate with, merge into or sell, assign, transfer, lease, convey or otherwise dispose of all or part of its properties and assets to the Issuer, or any Restricted Subsidiary; and
(2) the Issuer may merge with an Affiliate of the Issuer solely for the purpose of reorganizing the Issuer in a State of the United States, the District of Columbia or any territory thereof so long as the amount of Indebtedness of the Issuer and its Restricted Subsidiaries is not increased thereby.
Subject to certain limitations described in the Indenture governing the release of a Guarantee upon the sale, disposition or transfer of a Guarantor, no Guarantor will, and the Issuer will not permit any such Guarantor to, consolidate or merge with or into or wind up into (whether or not the Issuer or such Guarantor is the surviving Person), or sell, assign, transfer, lease, convey or otherwise dispose of
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all or substantially all of its properties or assets, in one or more related transactions, to any Person unless:
(a) such Guarantor is the surviving Person or the Person formed by or surviving any such consolidation or merger (if other than such Guarantor) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the jurisdiction of organization of such Guarantor, as the case may be, or the laws of the United States, any State thereof, the District of Columbia, or any territory thereof (such Guarantor or such Person, as the case may be, being herein called the"Successor Person");
(b) the Successor Person, if other than such Guarantor, expressly assumes all the obligations of such Guarantor under the Indenture and such Guarantor's related Guarantee pursuant to supplemental indentures or other documents or instruments in form reasonably satisfactory to the Trustee;
(c) immediately after such transaction, no Default exists; and
(d) the Issuer shall have delivered to the Trustee an Officer's Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indentures, if any, comply with the Indenture and constitutes the legal, valid and binding obligation enforceable against it in accordance with its terms.
The Successor Person will succeed to, and be substituted for, such Guarantor under the Indenture and such Guarantor's Guarantee and, except in the case of a lease, such Guarantor will automatically be released and discharged from its obligations under the Indenture and such Guarantor's Guarantee. Notwithstanding the foregoing, any Guarantor may merge into or transfer all or part of its properties and assets to another Guarantor or the Issuer.
Reports and Other Information
Notwithstanding that the Issuer may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the SEC, the Indenture requires the Issuer to file with the SEC (and make available (without exhibits) without cost to (i) Holders of the Notes, upon their request, and (ii) the Trustee, within 15 days after it files them with the SEC, in each case, to the extent not publicly available on the SEC's EDGAR system or the Issuer's public website) from and after the Issue Date,
(1) within the time period then in effect under the rules and regulations of the Exchange Act with respect to the filing of a Form 10-K by a non-accelerated filer (plus any grace period provided by Rule 12b-25 under the Exchange Act), annual reports on Form 10-K, or any successor or comparable form, containing the information required to be contained therein, or required in such successor or comparable form; and
(2) within the time period then in effect under the rules and regulations of the Exchange Act with respect to the filing of a Form 10-Q by a non-accelerated filer (plus any grace period provided by Rule 12b-25 under the Exchange Act), for each of the first three fiscal quarters of each fiscal year, reports on Form 10-Q containing all quarterly information that would be required to be contained in Form 10-Q, or any successor or comparable form;
in each case, in a manner that complies in all material respects with the requirements specified in such form;provided that the Issuer shall not be so obligated to file such reports with the SEC if the SEC does not permit such filing, in which event the Issuer will post on its website within 15 days after the time the Issuer would be required to file such reports with the SEC, if it were subject to Sections 13 or 15(d) of the Exchange Act; andprovided further, that that financial information required
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by Rule 3-10 or 3-16 (or any successor thereto) of Regulation S-X shall not be required and such reports shall not be required to comply with Sections 302, 906 and 404 of the Sarbanes-Oxley Act of 2002, as amended, or related items 307 and 308 of Regulation S-K, and the Issuer will not be required to provide financial statements in interactive data format using the eXtensible Business Reporting Language. In addition, to the extent not satisfied by the foregoing, the Issuer will agree that, for so long as any Notes are outstanding, it will furnish to Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act. Delivery of reports, information and documents to the Trustee pursuant to this covenant is for informational purposes only and its receipt of such reports shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including our compliance with any of our covenants under the Indenture or the Notes (as to which the trustee is entitled to rely exclusively on an Officer's Certificate). The Trustee shall not be obligated to monitor or confirm, on a continuing basis or otherwise, our compliance with the covenants or with respect to any reports or other documents filed with the SEC or the SEC's EDGAR system or any website under the Indenture, or participate in any conference calls.
Events of Default and Remedies
The Indenture provides that each of the following is an Event of Default with respect to a particular series of Notes:
(1) default in payment when due and payable, upon redemption, acceleration or otherwise, of principal of, or premium, if any, on such series of Notes;
(2) default for 30 days or more in the payment when due of interest on or with respect to such series of Notes;
(3) the failure by the Issuer for 90 days after receipt of written notice given by the Trustee or the Holders of not less than 25% in principal amount of the Notes then outstanding to comply with any of its obligations in the covenant described under "—Certain Covenants—Reports and Other Information";
(4) failure by the Issuer or any Guarantor for 60 days after receipt of written notice given by the Trustee or the Holders of not less 25% in principal amount of the Notes then outstanding to comply with any of its other obligations, covenants or agreements (other than a default referred to in clauses (1), (2) and (3) above) contained in the Indenture or the Notes with respect to such series of Notes;
(5) default under any mortgage, indenture or instrument under which there is issued or by which there is secured or evidenced any Indebtedness for money borrowed by the Issuer, any Guarantor or any Significant Subsidiary or the payment of which is guaranteed by the Issuer or, any Guarantor or any Significant Subsidiary, other than Indebtedness owed to the Issuer or any of its Subsidiaries, whether such Indebtedness or guarantee now exists or is created after the issuance of the Notes, if both:
(a) such default either results from the failure to pay any principal of such Indebtedness at its stated final maturity (after giving effect to any applicable grace periods) or relates to an obligation other than the obligation to pay principal of any such Indebtedness at its stated final maturity and results in the holder or holders of such Indebtedness causing such Indebtedness to become due prior to its stated maturity; and
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(b) the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness in default for failure to pay principal at stated final maturity (after giving effect to any applicable grace periods), or the maturity of which has been so accelerated, aggregate $200.0 million or more at any one time outstanding;
(6) certain events of bankruptcy or insolvency with respect to the Issuer or any Significant Subsidiary; or
(7) the Guarantee of any Significant Subsidiary shall for any reason cease to be in full force and effect or be declared null and void or any responsible officer of any Guarantor that is a Significant Subsidiary, as the case may be, denies that it has any further liability under its Guarantee or gives notice to such effect, other than by reason of the termination of the Indenture or the release of any such Guarantee in accordance with the Indenture.
If any Event of Default (other than of a type specified in clause (6) above) occurs and is continuing under the Indenture with respect to a particular series of Notes, the Trustee or the Holders of at least 25% in principal amount of the then total outstanding Notes of such series, may declare the principal, amount (or,premium, if any, interest and any other monetary obligations on all the then outstanding Notes of the debt securities
of that series are original issue discount securities, that portion of the
principal amount of the debt securities as may be specified by the terms
thereof) of the debt securities of thatsuch series, to be immediately due and payable. Under certain circumstances,payable immediately.
Upon the holderseffectiveness of such declaration, such principal and interest with respect to such series of Notes will be due and payable immediately. Notwithstanding the foregoing, in the case of an Event of Default arising under clause (6) of the first paragraph of this section, all outstanding Notes will become due and payable without further action or notice. The Indenture provides that the Trustee may withhold from the Holders notice of any continuing Default, except a Default relating to the payment of principal, premium, if any, or interest, if it determines that withholding notice is in their interest. In addition, the Trustee shall have no obligation to accelerate the Notes if in the best judgment of the Trustee acceleration is not in the best interest of the Holders of the Notes.
The Indenture provides that the Holders of a majority in aggregate principal amount of the then outstanding debt securitiesNotes of the applicable series by written notice to the Trustee may rescindon behalf of the declaration.
Under each indenture, unless otherwise specifiedHolders of all of the Notes of the applicable series waive any existing Default and its consequences under the Indenture except a continuing Default in an applicable
prospectus supplement with respect to a series of debt securities, the following
events will constitute an event of default with respect to a series of debt
securities:
o default in payment of interest on, premium, if any, or the principal of any debt securityNote of the applicable series orheld by a non-consenting Holder and rescind any required sinking fund payment;
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o default in payment of any interest or other amounts on any debt
security of the series when due, continuing for 30 days;
oacceleration and its consequences with respect to eachthe Notes. In the event of any Event of Default specified in clause (5) above, such Event of Default and all consequences thereof (excluding any resulting payment default, other than as a result of acceleration of the Notes) shall be annulled, waived and rescinded, automatically and without any action by the Trustee or the Holders, if within 30 days after such Event of Default arose:
(1) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged; or
(2) the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default; or
(3) the default that is the basis for such Event of Default has been cured.
Subject to the provisions of the Indenture relating to the duties of the Trustee thereunder, in case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the Holders of the Notes unless the Holders have offered to the Trustee indemnity or security satisfactory to the Trustee against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium (if
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any) or interest when due, no Holder of a Note may pursue any remedy with respect to the Indenture or the applicable series of debt securities, failureNotes unless:
(1) such Holder has previously given the Trustee notice that an Event of Default is continuing with respect to perform any
othersuch series of our covenants applicable to that series, which failure
continues for 60 days after written notice to us by the trustee or to
us and the trustee by the holdersNotes;
(2) Holders of at least 25% in principal amount of the total outstanding debt securities of that series specifying such
failure, requiring it to be remedied and stating that such notice is a
"Notice of Default";
o specified events of bankruptcy or insolvency; and
o any other event of default applicable to a series of debt securities
as set forth inNotes have requested the Trustee to pursue the remedy;
(3) Holders of the applicable prospectus supplement.
The trustee will give notice to holdersseries of Notes have offered the debt securities of any
continuing default knownTrustee security or indemnity satisfactory to the trusteeTrustee against any loss, liability or expense;
(4) the Trustee has not complied with such request within 9060 days after the occurrencereceipt thereof and the offer of security or indemnity; and
(5) Holders of a majority in principal amount at maturity of the default. However,total outstanding Notes of the trustee may withhold notice of any defaultapplicable series have not given the Trustee a direction inconsistent with such request within such 60-day period.
Subject to certain restrictions, under the debt securities of a series, other than a payment default, if it determines that
withholdingIndenture the notice is in the interests of the holders.
The holdersHolders of a majority in principal amount of the total outstanding debt
securitiesNotes of anythe applicable series mayare given the right to direct the time, method and place of conducting any proceeding for any remedy available to the trusteeTrustee or of exercising any trust or power conferred on the trusteeTrustee. The Trustee, however, may refuse to follow any direction that conflicts with respect to the debt securities of that
series so long as the direction does not conflict with any law or the indenture
and subjectIndenture or that the Trustee determines is unduly prejudicial to the rights of any other limitations provided for inHolder of a Note of the applicable indenture.
Before proceedingseries or that would involve the Trustee in personal liability.
The Indenture provides that the Issuer is required to exercisedeliver to the Trustee annually a statement regarding compliance with the Indenture, and the Issuer is required, within ten Business Days after becoming aware of any rightDefault, to deliver to the Trustee a statement specifying such Default.
No Personal Liability of Directors, Officers, Employees and Stockholders
No director, officer, employee, incorporator or powerstockholder of the Issuer or any Guarantor shall have any liability for any obligations of the Issuer or the Guarantors under the indenture atNotes, the directionGuarantees or the Indenture or for any claim based on, in respect of, holders,or by reason of such obligations or their creation. Each Holder by accepting Notes waives and releases all such liability. The waiver and release are part of the trustee willconsideration for issuance of the Notes. Such waiver may not be entitledeffective to receive fromwaive liabilities under the holders
reasonable security or indemnity satisfactory tofederal securities laws and it is the view of the SEC that such a waiver is against public policy.
Legal Defeasance and Covenant Defeasance
The obligations of the costs, expensesIssuer and liabilities which might be incurred by it in complying with the direction.
Unless otherwise specified in an applicable prospectus supplementGuarantors under the Indenture with respect to a series of debt securities, no holderNotes will terminate (other than certain obligations) and will be released upon payment in full of all of the Notes of such series. The Issuer may, at its option and at any time, elect to have any right to pursue any
remedyall of its obligations discharged with respect to a series of Notes and have the applicable indenture or the debt securities, unless:
o the holder has previously given the trustee written notice of a
continuing event of defaultIssuer's and each Guarantor's obligation discharged with respect to its related Guarantee("Legal Defeasance") and cure all then existing Events of Default with respect to such series except for:
(1) the debt securitiesrights of that series;
o the holdersHolders of at least 25% in aggregate principal amount of the
outstanding debt securities of theNotes with respect to such series have made a written request
to the trustee to pursue the remedy;
o the holder or holders have offered to the trustee reasonable security
or indemnity satisfactory to the trustee;
o the holders of a majority in aggregate principal amount of the
outstanding debt securities of the series have not given the trustee a
direction inconsistent with the request within 60 days after receipt
of the request; and
o the trustee has failed to comply with the request within the 60 day
period.
Notwithstanding the foregoing, the right of any holder of any debt security
or coupon to receive paymentpayments in respect of the principal of, premium, if any, and interest on such series of Notes when such payments are due solely out of the trust created pursuant to the Indenture;
(2) the Issuer's obligations with respect to such series of Notes concerning issuing temporary Notes of such series, registration of such Notes of such series, mutilated, destroyed, lost or stolen
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Notes of such series and the maintenance of an office or agency for payment and money for security payments held in trust;
(3) the rights, powers, trusts, duties and immunities of the Trustee, and the Issuer's obligations in connection therewith; and
(4) the Legal Defeasance provisions of the Indenture.
In addition, the Issuer may, at its option and at any time, elect to have its obligations and those of each Guarantor released with respect to substantially all of the restrictive covenants in the Indenture with respect to a series of Notes("Covenant Defeasance") and thereafter any omission to comply with such obligations shall not constitute a Default with respect to the Notes of such series. In the event Covenant Defeasance occurs with respect to a series of Notes, certain events (not including bankruptcy, receivership, rehabilitation and insolvency events pertaining to the Issuer) described under "Events of Default and Remedies" will no longer constitute an Event of Default with respect to such series of Notes.
In order to exercise either Legal Defeasance or Covenant Defeasance with respect to a series of Notes:
(1) the Issuer must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders of such series of Notes, cash in U.S. dollars, Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a debt security or paymentnationally recognized firm of the coupon on the date specified for
payment in the debt security or coupon representing the installment of interest
(the "stated maturity" or "stated maturities") orindependent public accountants, to institute suit forpay the
enforcement of payment may not be impaired or adversely affected without the
holder's consent. The holders of at least a majority in aggregate principal amount of, premium, if any, and interest due on such series of Notes on the outstanding debt securitiesstated maturity date or on the redemption date, as the case may be, of any series may waive an existing
default with respect to that series and its consequences, other than (i) any
default in any payment of thesuch principal of, andamount, premium, if any, or interest on such series of Notes and the Issuer must specify whether such series of Notes are being defeased to maturity or to a particular redemption date;provided, that in connection with any debt securitydefeasance to a redemption date prior to August 15, 2021, in the case of the series,2021 Notes, or (ii) any defaultJune 15, 2026, in the case of the 2026 Notes, the amount deposited in respect of the covenants
or provisions in the applicable indenture which may notApplicable Premium shall be modified
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without the consentsufficient for purpose of the holder of each outstanding debt securityIndenture to the extent that an amount is deposited with the Trustee equal to the Applicable Premium calculated as of the series affected as described in "--Modification and Waiver," below.
Unless otherwise specified in an applicable prospectus supplement, each
indenture will provide for us to deliver to the trustee within 120 days after
the end of each of our fiscal years an officers' certificate stating whether or
not the signers know of any default that occurred during the last fiscal year.
Modification and Waiver
Except as otherwise described in the applicable prospectus supplement, the
indentures will permit us and the applicable trustee to execute a supplemental
indenture without the consentdate of the holders ofdeposit, with any deficit on such redemption date (any such amount, the debt securities or any
related coupons:
o to evidence the succession of another corporation to us and the
assumption by it of our obligations under the applicable indenture and
the debt securities;
o to add to our covenants, agreements and obligations for the benefit of
the holders of all the debt securities of any series or to surrender
any right or power conferred in the applicable indenture upon us;
o to provide that bearer securities may be registrable as to principal,
to change or eliminate any restrictions (including restrictions
relating to payment in the United States) on the payment of principal
of and premium, if any, or interest, if any, on bearer securities, to
permit bearer securities"Applicable Premium Deficit") only required to be issued in exchange for registered
securities, to permit bearer securities to be issued in exchange for
bearer securities of other authorized denominationsdeposited with the Trustee on or to permit the
issuance of debt securities in uncertificated form;
o to establish the form or terms of debt securities of any series or
coupons as permitted by the applicable indenture;
o to provide for the acceptance of appointment under the applicable
indenture of a successor trustee with respect to the debt securities
of one or more series and to add to or change any provisions of that
indenture as shall be necessary to provide for or facilitate the
administration of the trusts by more than one trustee;
o to cure any ambiguity, defect or inconsistency;
o to add to, change or eliminate any provisions (which addition, change
or elimination may apply to one or more series of debt securities),
provided that the addition, change or elimination neither (a) applies
to any debt security of any series that was created prior to the execution of the supplemental indenturecorresponding redemption date, and is entitledwith any excess on such redemption date required to be returned to the benefit
of that provision nor (b) modifiesIssuer by the rights ofTrustee. Any Applicable Premium Deficit shall be set forth in an Officer's Certificate delivered to the holder of any
such debt security with respect to that provision;
o to add events of default for the benefit of all or any series of debt
securities;
o to secure the debt securities; or
o to make any other change that does not adversely affect the rights of
any holder of the debt securities.
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Each indenture will also permit us and the applicable trustee,Trustee simultaneously with the consentdeposit of the holders of not less than a majority in aggregate principal amount
of the outstanding debt securities of the series affected by the supplemental
indenture, to execute a supplemental indenture to add provisions to, or change
in any manner or eliminate any provisions of, the indenture with respect tosuch Applicable Premium Deficit that series of debt securities or modify in any manner the rights of the holders of
the debt securities ofconfirms that series and any related coupons under the applicable
indenture. However, the supplemental indenture will not, without the consent of
the holder of each outstanding debt security affected thereby:
o change the stated maturity of the principal of, or any installment of
principal or interest on, the debt securities or any premium payable
upon redemption thereof;
o reduce the amount of principal of any original issue discount
securities that wouldsuch Applicable Premium Deficit shall be due and payable upon declaration of
acceleration of maturity thereof;
o reduce the principal amount of, or premium, if any, or the rate of
interest on, the debt securities;
o change the place or currency of payment of principal and premium, if
any, or interest, if any, on the debt securities;
o impair the right to institute suit for the enforcement of any payment
on or with respect to the debt securities;
o reduce the percentage of the outstanding debt securities of any series
necessary to modify or amend the indenture;
o modify the foregoing requirements or reduce the percentage in
principal amount of outstanding debt securities of any series
necessary to waive any covenant or past default; or
oapplied toward such redemption;
(2) in the case of subordinated debt securities, amend or modify any ofLegal Defeasance, the provisions of the applicable indenture relating to subordination
of the debt securities in any manner adverse to the holders of the
debt securities.
Holders of not less than a majority of the principal amount of the
outstanding debt securities of any series may waive certain past defaults and
may waive compliance by us with certain of the restrictive covenants described
above with respect to the debt securities of that series.
Discharge and Defeasance
Unless otherwise indicated in an applicable prospectus supplement, we will
be able to discharge all of our obligations, other than administrative
obligations such as facilitating transfers and exchanges of certificates and
replacement of lost or mutilated certificates, relating to a series of debt
securities under an indenture by depositing cash and/or U.S. Government
obligations with the trustee in an amount sufficient to make all of the
remaining payments of principal, premium and interest on those debt securities
when those payments are due. We can do this only if weIssuer shall have delivered to the trustee, among other things,Trustee an opinionOpinion of counsel based on aCounsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions,
(a) the Issuer has received from, or there has been published by, the United States Internal Revenue Service a ruling, or other
(b) since the issuance of such series of Notes, there has been a change in the applicable U.S. federal income tax law,
stating
in either case to the effect that, holdersand based thereon such Opinion of Counsel shall confirm that, subject to customary assumptions and exclusions, the Holders of such series of Notes will not recognize anyincome, gain or loss for U.S. federal income tax purposes, as applicable, as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
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(3) in the case of Covenant Defeasance, the Issuer shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, the Holders of such series of Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of this deposit.
Uponsuch Covenant Defeasance and will be subject to such tax on the defeasancesame amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
(4) no Default (other than that resulting from borrowing funds to be applied to make such deposit and any similar and simultaneous deposit relating to other Indebtedness, and, in each case the granting of Liens in connection therewith) shall have occurred and be continuing on the date of such deposit with respect to such series of Notes;
(5) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under the Senior Credit Facilities or any other material agreement or instrument (other than the Indenture) to which, the Issuer or any Guarantor is a party or by which the Issuer or any Guarantor is bound (other than that resulting from borrowing funds to be applied to make such deposit and any similar and simultaneous deposit relating to other Indebtedness and, in each case, the granting of Liens in connection therewith);
(6) the Issuer shall have delivered to the Trustee an Officer's Certificate stating that the deposit was not made by the Issuer with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuer or any Guarantor or others; and
(7) the Issuer shall have delivered to the Trustee an Officer's Certificate and an Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and exclusions) each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance, as the case may be, have been complied with.
Satisfaction and Discharge
The Indenture will be discharged and will cease to be of further effect as to a series of Notes, when either:
(1) all Notes of such series theretofore authenticated and delivered, except lost, stolen or destroyed Notes of such series which have been replaced or paid and Notes of such series for whose payment money has theretofore been deposited in trust, have been delivered to the Trustee for cancellation; or
(2) (a) all Notes of such series not theretofore delivered to the Trustee for cancellation have become due and payable by reason of the making of a notice of redemption or otherwise, will become due and payable within one year or are to be called for redemption and redeemed within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuer, and the Issuer or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders of the Notes of such series cash in U.S. dollars, Government Securities, or a combination thereof, in such amounts as will be sufficient without consideration of any reinvestment of interest to pay and discharge the holdersentire indebtedness on the Notes not theretofore delivered to the Trustee for cancellation for principal, premium, if any, and accrued interest to the date of maturity or redemption;provided, that upon any redemption that requires the payment of the debt securitiesApplicable Premium, the amount deposited shall be sufficient for purpose of the series will no longer be entitledIndenture to the benefitsextent that an amount is deposited with the Trustee equal to the Applicable Premium calculated as of the applicable
indenture, exceptdate of the notice of redemption, with any Applicable Premium Deficit only required to be deposited with the Trustee on or prior to the redemption date, and with any excess on such redemption date required to be returned to the Issuer by the Trustee. Any Applicable
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Premium Deficit shall be set forth in an Officer's Certificate delivered to the Trustee simultaneously with the deposit of such Applicable Premium Deficit that confirms that such Applicable Premium Deficit shall be applied toward such redemption;
(b) no Default (other than that resulting from borrowing funds to be applied to make such deposit and any similar and simultaneous deposit relating to other Indebtedness and, in each case, the granting of Liens in connection therewith) with respect to the Indenture as it relates to such series of Notes or the Notes of such series shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under the Senior Credit Facilities or any other material agreement or instrument governing Indebtedness (other than the Indenture) to which the Issuer or any Guarantor is a party or by which the Issuer or any Guarantor is bound (other than that resulting from borrowing funds to be applied to make such deposit and any similar and simultaneous deposit relating to other Indebtedness and, in each case, the granting of Liens in connection therewith);
(c) the Issuer has paid or caused to be paid all sums payable by it under the Indenture; and
(d) the Issuer has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Notes of such series at maturity or the redemption date, as the case may be.
In addition, the Issuer must deliver an Officer's Certificate and an Opinion of Counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been satisfied.
Amendment, Supplement and Waiver
Except as provided in the next two succeeding paragraphs, the Indenture, any Guarantee and the Notes of any series may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the Notes of such series then outstanding, including consents obtained in connection with a purchase of, or tender offer or exchange offer for Notes of such series, and any existing Default or compliance with any provision of the Indenture or the Notes of such series issued thereunder may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes of such series, other than Notes of such series beneficially owned by the Issuer or its Affiliates (including consents obtained in connection with a purchase of or tender offer or exchange offer for the purposesNotes of registrationsuch series).
The Indenture provides that, without the consent of each affected Holder of Notes, an amendment or waiver may not, with respect to any Notes of a series held by a non-consenting Holder:
(1) reduce the principal amount of such series of Notes whose Holders must consent to an amendment, supplement or waiver;
(2) reduce the principal amount of or change the fixed final maturity of any such Note or alter or waive the provisions with respect to the redemption of such Notes (other than provisions relating to the covenants described above under the caption "Repurchase of Notes upon a Change of Control Repurchase Event");
(3) reduce the rate of or change the time for payment of interest on any Note of such series;
(4) waive a Default in the payment of principal of or premium, if any, or interest on the Notes of such series, except a rescission of acceleration of the Notes of such series by the Holders of at least a majority in aggregate principal amount of the Notes of such series and a waiver of the payment default that resulted from such acceleration, or in respect of a covenant or provision contained in the Indenture or any Guarantee which cannot be amended or modified without the consent of all Holders;
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(5) make any such Note payable in money other than that stated therein;
(6) make any change in the provisions of the Indenture relating to waivers of past Defaults or the rights of Holders to receive payments of principal of or premium, if any, or interest on the Notes of such series;
(7) make any change in these amendment and waiver provisions as it relates to such series of Notes;
(8) amend the contractual right expressly set forth in the Indenture of any Holder to receive payment of principal of, premium, if any, and interest on, such Holder's Notes on or after the due dates thereof or to institute suit for the enforcement of any such payment on or after such due dates;
(9) make any change to or modify the ranking of the Notes of such series that would adversely affect the Holders; or
(10) except as expressly permitted by the Indenture, modify the Guarantees of any Significant Subsidiary in any manner adverse to the Holders of the Notes of such series.
Notwithstanding the foregoing, the Issuer, any Guarantor (with respect to a Guarantee or the Indenture to which it is a party) and the Trustee may amend or supplement the Indenture and any Guarantee or the Notes without the consent of any Holder;
(1) to cure any ambiguity, omission, mistake, defect or inconsistency;
(2) to provide for uncertificated Notes of such series in addition to or in place of certificated Notes or to provide for the issuance of Additional Notes;
(3) to comply with the covenant relating to mergers, consolidations and sales of assets;
(4) to provide the assumption of the Issuer's or any Guarantor's obligations to the Holders;
(5) to secure the Notes or make any change that would provide any additional rights or benefits to the Holders or that does not materially adversely affect the legal rights under the Indenture of any such Holder;
(6) to add covenants for the benefit of the Holders or to surrender any right or power conferred upon the Issuer or any Guarantor;
(7) to comply with requirements of the SEC in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act;
(8) to evidence and provide for the acceptance and appointment under the Indenture of a successor Trustee thereunder pursuant to the requirements thereof;
(9) to provide for the issuance of exchange notes or private exchange notes, which are identical to exchange notes except that they are not freely transferable;
(10) to add a Guarantor under the Indenture or release Guarantors from Guarantees as provided by the terms of the Indenture;
(11) to conform the text of the Indenture, Guarantees or the Notes to any provision of the "Description of Notes" section of the Offering Memorandum to the extent that such provision in such "Description of Notes" section was intended to be a verbatim recitation of a provision of the Indenture, Guarantee or Notes as set forth in an Officer's Certificate; or
(12) making any amendment to the provisions of the Indenture relating to the transfer and exchangelegending of Notes as permitted by the Indenture, including, without limitation to facilitate the issuance and administration of the debtNotes or comply with the procedures of any securities
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despoitary;provided, however, that (i) compliance with the Indenture as so amended would not result in Notes being transferred in violation of the seriesSecurities Act or any applicable securities law and replacement(ii) such amendment does not materially and adversely affect the rights of lost, stolen or mutilated
debt securities and may look onlyHolders to transfer Notes.
The consent of the deposited funds or obligations for
payment.
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The TrusteesHolders is not necessary under the IndenturesIndenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance of the proposed amendment.
Notices
Notices given by publication will be deemed given on the first date on which publication is made and notices given by first-class mail, postage prepaid, will be deemed given five calendar days after mailing.
Concerning the Trustee
The trustees underIndenture contains certain limitations on the indentures, and/rights of the Trustee thereunder, should it become a creditor of the Issuer, to obtain payment of claims in certain cases, or oneto realize on certain property received in respect of any such claim as security or more of their respective
affiliates, may be lenders under our credit agreements and may provide other
commercial banking, investment banking and other services to us and/or our
subsidiaries and affiliates. Each trusteeotherwise. The Trustee will be permitted to engage in other transactions with us and/or our subsidiaries and affiliates. However,transactions; however, if any
trusteeit acquires any conflicting interest as defined in the Trust Indenture
Act, it must eliminate such conflict within 90 days, apply to the conflictSEC for permission to continue or resign.
The trusteesIndenture provides that the Holders of a majority in principal amount of the outstanding Notes of a series will perform only those dutieshave the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee, subject to certain exceptions. The Indenture provides that are specifically set forthin case an Event of Default shall occur (which shall not be cured), the Trustee will be required, in the indentures, unless an eventexercise of default occurs and is continuing. In case
an event of default occurs and is continuing, a trustee will exerciseits power, to use the same degree of care and skill asthat a prudent individualperson would exerciseuse under the circumstances in the conduct of his or her own affairs. ApplicableSubject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request of any Holder of the Notes, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.
Governing Law
The debt securitiesIndenture, the Notes and the indenturesGuarantees will be governed by and construed in accordance with the laws of the State of New York, exceptYork.
Certain Definitions
Set forth below are certain defined terms used in the Indenture. For purposes of the Indenture, unless otherwise specifically indicated, the term "consolidated" with respect to any Person refers to such Person consolidated with the Issuer and its Restricted Subsidiaries, and excludes from such consolidation any Unrestricted Subsidiary as if such Unrestricted Subsidiary were not an Affiliate of such Person.
"Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.
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"Applicable Premium" means:
(1) with respect to any 2021 Note on any redemption date, the excess, if any, of (i) the present value at such redemption date of (A) 100% of the aggregate principal amount of such 2021 Note on such redemption date, plus (B) all required interest payments due on such 2021 Note through August 15, 2021 (excluding accrued but unpaid interest to the extent that the
Trust Indenture Act is applicable.
Conversion or Exchange
If andredemption date), computed using a discount rate equal to the extent indicatedapplicable Treasury Rate as of such redemption date plus 20 basis points; over (ii) the principal amount of such 2021 Note; and
(2) with respect to any 2026 Note on any redemption date, the excess, if any, of (i) the present value at such redemption date of (A) 100% of the aggregate principal amount of such 2026 Note on such redemption date, plus (B) all required interest payments due on such 2026 Note through June 15, 2026 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the applicable Treasury Rate as of such redemption date plus 30 basis points; over (ii) the principal amount of such 2026 Note.
The Issuer shall calculate the Applicable Premium.
"Below Investment Grade Rating Event" means the occurrence of a Change of Control that is accompanied or followed by a downgrade of the Notes within the Ratings Decline Period by each of the Rating Agencies to a rating that is not an Investment Grade Rating. Notwithstanding anything to the contrary, no Change of Control Repurchase Event will be deemed to have occurred in connection with any particular Change of Control unless and until such Change of Control has actually been consummated.
"Business Day" means each day which is not a Legal Holiday.
"Capital Stock" means:
(1) in the applicable prospectus supplement,case of a corporation, corporate stock;
(2) in the debtcase of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;
(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and
(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means:
(1) United States dollars;
(2) (a) Canadian dollars, Swiss Francs, Euro, British Pounds or any national currency of any participating member state of the EMU; or
(b) in the case of any Foreign Subsidiary that is a Restricted Subsidiary, such local currencies held by them from time to time in the ordinary course of business;
(3) securities issued or directly and fully and unconditionally guaranteed or insured by the U.S. government or any agency or instrumentality thereof the securities of which are unconditionally guaranteed as a full faith and credit obligation of such government with maturities of 24 months or less from the date of acquisition;
(4) certificates of deposit, time deposits and dollar time deposits with maturities of one year or less from the date of acquisition, bankers' acceptances with maturities not exceeding one year and overnight bank deposits, in each case with any series may be convertible or exchangeable into other
securities,commercial bank having capital and surplus of
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not less than $500.0 million in the specific terms on which debtcase of U.S. banks and $100.0 million (or the U.S. dollar equivalent as of the date of determination) in the case of non-U.S. banks;
(5) repurchase obligations for underlying securities of the types described in clauses (3) and (4) entered into with any series mayfinancial institution meeting the qualifications specified in clause (4) above;
(6) commercial paper rated at least P-1 by Moody's or at least A-1 by S&P and in each case maturing within 24 months after the date of creation thereof;
(7) marketable short-term money market and similar securities having a rating of at least P-2 or A-2 from either Moody's or S&P, respectively (or, if at any time neither Moody's nor S&P shall be so
convertedrating such obligations, an equivalent rating from another Rating Agency) and in each case maturing within 24 months after the date of creation thereof;
(8) investment funds investing 95% of their assets in securities of the types described in clauses (1) through (7) above and (9) through (11) below;
(9) readily marketable direct obligations issued by any state, commonwealth or exchanged will beterritory of the United States or any political subdivision or taxing authority thereof having an Investment Grade Rating from either Moody's or S&P with maturities of 24 months or less from the date of acquisition;
(10) Indebtedness or preferred stock issued by Persons with a rating of "A' or higher from S&P or "A2" or higher from Moody's with maturities of 24 months or less from the date of acquisition; and
(11) Investments with average maturities of 24 months or less from the date of acquisition in money market funds rated AAA– (or the equivalent thereof) or better by S&P or Aaa3 (or the equivalent thereof) or better by Moody's.
Notwithstanding the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in clauses (1) and (2) above,provided that such amounts are converted into any currency listed in clauses (1) and (2) as promptly as practicable and in any event within ten Business Days following the applicable prospectus
supplement. These terms may include provisionsreceipt of such amounts.
"Change of Control" means the occurrence of any of the following:
(1) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Issuer and its Subsidiaries, taken as a whole, to any Person;
(2) the Issuer becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act), including any group acting for conversionthe purpose of acquiring, holding or exchange,disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act or any successor provision), in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase, of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of a majority or more of the total voting power of the Voting Stock of the Issuer; or
(3) the approval of any plan or proposal for the winding up or liquidation of the Issuer.
For purposes of this definition, any direct or indirect holding company of the Issuer shall not itself be considered a "Person" or "group" for purposes of clause (2) above;provided that no "Person" or "group" beneficially owns, directly or indirectly, more than a majority of the total voting power of the Voting Stock of such holding company.
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"Change of Control Repurchase Event" means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.
"Consolidated Total Assets" means, as of any date of determination, the total assets of the Issuer and its Restricted Subsidiaries on a consolidated basis as shown on or reflected in the Issuer's most recent internal consolidated balance sheet (including, without duplication, the notes related thereto) prepared in accordance with GAAP,provided that Consolidated Total Assets shall be calculated after giving pro forma effect to any investments, acquisitions or dispositions occurring subsequent to the date of such balance sheet, as well as any such transaction giving rise to the need to calculate Consolidated Total Assets.
"Contingent Obligations" means, with respect to any Person, any obligation of such Person guaranteeing any leases, dividends or other obligations that do not constitute Indebtedness("primary obligations") of any other Person (the"primary obligor") in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent:
(1) to purchase any such primary obligation or any property constituting direct or indirect security therefor,
(2) to advance or supply funds:
(a) for the purchase or payment of any such primary obligation, or
(b) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, or
(3) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.
"Default" means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.
"EMU" means economic and monetary union as contemplated in the Treaty on European Union.
"Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Capital Stock.
"euro" means the single currency of participating member states of the EMU.
"Event of Default" has the meaning set forth under "Events of Default and Remedies."
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.
"Foreign Subsidiary" means any Restricted Subsidiary that is not a Guarantor and that is not organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof and any Restricted Subsidiary of such Foreign Subsidiary.
"GAAP" means generally accepted accounting principles in the United States which are in effect on the Issue Date.
"Government Securities" means securities that are:
(1) direct obligations of, or obligations guaranteed by, the United States of America for the timely payment of which its full faith and credit is pledged; or
(2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either mandatory,
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case, are not callable or redeemable at the option of the holder, or at our option,issuers thereof, and shall also include a depository receipt issued by a bank (as defined in which case
the number of shares of other securities to be received by the holders of debt
securities would be calculated as of a time and in the manner stated in the
applicable prospectus supplement.
DESCRIPTION OF CAPITAL STOCK
The following description of our common stock and preferred stock, together
with the additional information we include in any applicable prospectus
supplements, summarizes the material terms and provisionsSection 3(a)(2) of the common stock
and preferred stock that we may offer under this prospectus. For the complete
terms of our common stock and preferred stock, please refer to our Amended and
Restated Certificate of Incorporation,Securities Act), as amended, and our Amended and Restated
Bylaws that are incorporated by reference into the registration statement which
includes this prospectus. The General Corporation Law of Delaware may also
affect the terms of these securities. While the terms we have summarized below
will apply generallycustodian with respect to any future common stocksuch Government Securities or preferred stock that we may
offer, we will describe the particular terms of any series of these securities
in more detail in the applicable prospectus supplement. If we indicate in a prospectus supplement, the terms of any common stock or preferred stock we offer
under that prospectus supplement may differ from the terms we describe below.
Under our Amended and Restated Certificate of Incorporation, as amended,
our authorized capital stock consists of 130,000,000 shares of stock, $.000001
par value per share, consisting of 125,000,000 shares of common stock, 3,750,000
shares of serial preferred stock and 1,250,000 shares of Series A Junior
Preferred Stock. As of November 12, 2002, we had 66,995,133 shares of common
stock outstanding and no shares of preferred stock outstanding. All outstanding
shares of common stock are duly authorized, validly issued, fully paid and
nonassessable.
Common Stock
Each outstanding share of common stock entitles the holder to one vote on
all matters submitted to a vote of stockholders, including the election of
directors. There is no cumulative voting in the election of directors, which
means that the holders of a majority of the outstanding shares of common stock
can elect all of the directors then
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standing for election. Subject to preferences which may be applicable to any
outstanding shares of preferred stock, holders of common stock are entitled to
such distributions as may be declared from time to time by our Board of
Directors out of funds legally available. We have not paid, and have no current
plans to pay, cash dividends on our common stock. We intend to retain all
earnings for use in our business.
Holders of common stock have no conversion, redemption or preemptive rights
to subscribe to any of our securities. All outstanding shares of common stock
are fully paid and nonassessable. In the event of any liquidation, dissolution
or winding up of the affairs of holders of our common stock will be entitled to
share ratably in our assets remaining after provision forspecific payment of liabilities
to creditors and preferences applicable to outstanding sharesprincipal of preferred
stock.
The rights, preferences and privileges of holders of common stock are
subject to the rights of the holders ofor interest on any outstanding shares of preferred
stock. At present, no shares of preferred stock are outstanding. Each share of
common stock includes a right to purchase two three-hundredths of a share of
Series A Junior Preferred Stock pursuant to a rights agreement between us and
Continental Stock Transfer & Trust Company, as rights agent. As of November 12,
2002, we had approximately 3,200 stockholders of record, excluding banks,
brokers and depository companies that are stockholders of recordsuch Government Securities held by such custodian for the account of beneficial owners.
The transfer agentthe holder of such depository receipt;provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal of or interest on the Government Securities evidenced by such depository receipt.
"guarantee" means a guarantee (other than by endorsement of negotiable instruments for our common stock is Continental Stock Transfer &
Trust Company, 17 Battery Place, New York, New York 10004.
Shareholder Rights Plan
On April 18, 2000, our board of directors approved a shareholders rights
plan. Under the rights plan, each common shareholder at the close of business on
April 19, 2000 received a dividend of one right for each share of common stock
held. Each right represents the right to purchase two three-hundredths (2/300)
of a share of our Series A Junior Preferred Stock at an exercise price of
$40.00. Initially, the rights are represented by our common stock certificates
and are neither exercisable nor traded separately from our common stock. The
rights will only become exercisable if a person or group acquires 15% or more of
our common stock, or announces or commences a tender or exchange offer which
would resultcollection in the bidder's acquiring 15%ordinary course of business), direct or moreindirect, in any manner (including letters of our common stock.
Incredit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness or other obligations.
"Guarantee" means the event thatguarantee by any person or group acquires 15% or more of our
outstanding common stock, each holder of a right (other than such person or
members of such group) will then have the right to receive, upon exercise of a
right, in lieu of shares of Series A Junior Preferred Stock, the number of
shares of our common stock having a value equal to two times the then current
exercise priceGuarantor of the right. If we are acquired in a merger or other business
combination transaction after a person has acquired 15% or more of our common
stock,Issuer's Obligations under the Indenture.
"Guarantor" means, each holder of a right will then haveRestricted Subsidiary that Guarantees the right to receive, upon exercise
of a right, a number of the acquiring company's common shares having a market
value equal to two times the then current exercise price of the right. For
persons who, as of the close of business on April 18, 2000, beneficially own 15%
or more of the our common stock, the rights plan "grandfathers" their current
level of ownership, so long as they do not purchase additional shares in excess
of certain limitations.
We may redeem the rights for $.01 per right at any time prior to
approximately the tenth day following the first public announcement of the
acquisition of 15% of our common stock. At any time after a person has acquired
15% or more (but before any person has acquired more than 50%) of our common
stock, we may exchange all or part of the rights for shares of common stock at
an exchange ratio of one share of common stock per right. The rights expire on
April 18, 2010.
Our rights agreement has anti-takeover effects. The rights may cause
substantial dilution to a person or group that attempts to acquire us without
conditioning the offer on a substantial number of rights being acquired,
redeemed or declared invalid. Accordingly, the existence of the rights may deter
acquirors from making takeover proposals or tender offers. However, the rights
are not intended to prevent a
25
takeover, but rather are designed to enhance the ability of our board of
directors to negotiate with an acquiror on behalf of all of the stockholders. In
addition, the rights should not interfere with a proxy contest.
Preferred Stock
General
Our board of directors is authorized to issue shares of preferred stock
from time to time up to an aggregate of 5,000,000 shares of our preferred stock,
which includes 1,250,000 authorized shares of Series A Junior Preferred Stock
issuable pursuant to the rights agreement described above. Our board of
directors is authorized to issue shares of preferred stock in one or more
series, and to fix or alter the dividend rights, dividend rate, conversion
rights, voting rights, rights and terms of redemption, including sinking fund
provisions, the redemption price or prices, and the liquidation preferences or
other special rights, qualifications, limitations or restrictions as are
permitted by the Delaware General Corporation Law for each series of preferred
stock.
The prospectus supplement will describe the terms of any series of
preferred stock being offered, including:
o the designation of the shares and the number of shares that constitute
the series;
o the dividend rate (or the method of calculation thereof), if any, on
the shares of the series and the priority as to payment of dividends
with respect to other classes or series of our capital stock and the
payment date of dividends;
o the dividend periods (or the method of calculation thereof);
o the date from which dividends on the preferred stock shall accumulate,
if applicable;
o the voting rights of the shares;
o the liquidation preference and the priority as to payment of the
liquidation preference with respect to other classes or series of our
capital stock and any other rights of the shares of the series upon
our liquidation or winding up;
o whether the preferred stock will rank senior or junior to or on a
parity with any other class or series of preferred stock;
o whether or not and on what terms the shares of the series will be
subject to redemption or repurchase at our option;
o whether and on what terms the shares of the series will be convertible
into or exchangeable for other securities;
o the provision of a sinking fund, if any, for the preferred stock;
o whether the shares of the series of preferred stock will be listed on
a securities exchange;
o any special United States federal income tax considerations applicable
to the series; and
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o the other rights and privileges and any qualifications, limitations or
restrictions of the rights or privileges of the series.
Dividends
Unless otherwise set forth in the applicable prospectus supplement, holders
of shares of preferred stock will be entitled to receive, when and as declared
by our board of directors out of our funds legally available therefor, an annual
cash dividend payable at the dates and at the rates, if any, per share per annum
as set forth in the applicable prospectus supplement.
Unless otherwise set forth in the applicable prospectus supplement, each
series of preferred stock will rank junior as to dividends to any preferred
stock that may be issued in the future that is expressly senior as to dividends
to that preferred stock. If we should fail at any time to pay accrued dividends
on any senior shares at the time the dividends are payable, we may not pay any
dividend on the junior preferred stock or redeem or otherwise repurchase shares
of junior preferred stock until the accumulated but unpaid dividends on the
senior shares have been paid or set aside for payment in full by us.
Unless otherwise set forth in the applicable prospectus supplement, no
dividends (other than in common stock or other capital stock ranking junior to
the preferred stock of any series as to dividends and upon liquidation) may be
declared or paid or set aside for payment, nor may any other distribution be
declared or made upon the common stock, or any of our other capital stock
ranking junior to or on a parity with the preferred stock of that series as to
dividends, nor may any common stock or any of our other capital stock ranking
junior to or on a parity with the preferred stock of that series as to dividends
be redeemed, purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the redemption of any
shares of any of that stock) by us (except by conversion into or exchange for
other capital stock of ours ranking junior to the preferred stock of that series
as to dividends) unless:
o if that series of preferred stock has a cumulative dividend, full
cumulative dividends on the preferred stock of that series have been
or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof set apart for all past dividend
periods and the then current dividend period; and
o if such series of preferred stock does not have a cumulative dividend,
full dividends on the preferred stock of such series have been or
contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof set apart for payment for the then
current dividend period.
However, any monies deposited in any sinking fund with respect to any
preferred stock in compliance with the provisions of the sinking fund may be
applied to the purchase or redemption of that preferred stockNotes in accordance with the terms of the sinking fund, regardlessIndenture.
"Hedging Obligations" means, with respect to any Person, the obligations of such Person under any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, commodity swap agreement, commodity cap agreement, commodity collar agreement, foreign exchange contract, currency swap agreement or similar agreement providing for the transfer or mitigation of interest rate or currency risks either generally or under specific contingencies.
"Holder" means the Person in whose name a Note is registered on the registrar's books.
"Indebtedness" means, with respect to any Person, indebtedness of such Person for borrowed money, if and to the extent any such indebtedness would appear as a liability upon a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with GAAP;provided, however, that notwithstanding the foregoing, Indebtedness shall be deemed not to include (a) Contingent Obligations incurred in the ordinary course of business or (b) obligations under or in respect of Receivables Facilities.
"Investment Grade Rating" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's and BBB– (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency, without regard to outlook.
"Issue Date" means September 19, 2016.
"Issuer" has the meaning set forth in the first paragraph under "General".
"Legal Holiday" means a Saturday, a Sunday or a day on which commercial banking institutions or the place of payment are not required to be open in the State of New York.
"Lien" means, with respect to any asset, any mortgage, lien (statutory or otherwise), pledge, hypothecation, charge, security interest, preference, priority or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction;provided that in no event shall an operating lease be deemed to constitute a Lien.
"Moody's" means Moody's Investors Service, Inc. and any successor to its rating agency business.
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"Obligations" means any principal (including any accretion), interest (including any interest accruing subsequent to the filing of a petition in bankruptcy, reorganization or similar proceeding at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable state, federal or foreign law), penalties, fees, indemnifications, reimbursements (including reimbursement obligations with respect to letters of credit and banker's acceptances), damages and other liabilities, and guarantees of payment of such principal (including any accretion), interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities, payable under the documentation governing any Indebtedness.
"Offering Memorandum" means the offering memorandum, dated September 14, 2016, relating to the sale of the Old Notes.
"Officer" means the Chief Executive Officer, the President, any Executive Vice President, Senior Vice President or Vice President, the Treasurer, Assistant Treasurer, the Secretary or the Assistant Secretaries of the Issuer.
"Officer's Certificate" means a certificate signed on behalf of the Issuer by an Officer of the Issuer, who must be the principal executive officer, the principal financial officer, the treasurer, the principal accounting officer or Secretary of the Issuer, which meets the requirements set forth in the Indenture.
"Opinion of Counsel" means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be an employee of or counsel to the Issuer or the Trustee.
"Permitted Liens" means, with respect to any Person:
(1) pledges, deposits or security by such Person under workmen's compensation laws, unemployment insurance, employers' health tax, and other social security laws or similar legislation or other insurance related obligations (including, but not limited to, in respect of deductibles, self-insured retention amounts and premiums and adjustments thereto) or indemnification obligations of (including obligations in respect of letters of credit or bank guarantees for the benefit of) insurance carriers providing property, casualty or liability insurance, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or U.S. government bonds to secure surety, stay, customs or appeal bonds to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, performance and return of money bonds and other similar obligations (including letters of credit issued in lieu of any such bonds or to support the issuance thereof and including those to secure health, safety and environmental obligations), in each case incurred in the ordinary course of business;
(2) Liens imposed by law or regulation, such as carriers', warehousemen's and mechanics' Liens, in each case for sums not yet overdue for a period of more than 30 days or being contested in good faith by appropriate proceedings or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review if adequate reserves with respect thereto are maintained on the books of such Person in accordance with GAAP;
(3) Liens for taxes, assessments or other governmental charges not yet overdue for a period of more than 30 days or payable or subject to penalties for nonpayment or which are being contested in good faith by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of such Person in accordance with GAAP;
(4) Liens in favor of issuers of performance, surety bonds or bid, indemnity, warranty, release, appeal or similar bonds or with respect to other regulatory requirements or letters of
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credit issued pursuant to the request of and for the account of such Person in the ordinary course of its business;
(5) minor survey exceptions, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions (including, without limitation, minor defects or irregularities in title and similar encumbrances) as to the use of real properties or Liens incidental, to the conduct of the business of such Person or to the ownership of its properties which were not incurred in connection with Indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;
(6) Liens securing Indebtedness incurred to finance the construction, acquisition (including acquisition through merger or consolidation), purchase or lease of, or repairs, improvements or additions to any property, plant or equipment of the Issuer or its Restricted Subsidiaries;provided, however, that the Lien shall not extend to any other property owned by the Issuer or any of its Restricted Subsidiaries at the time the Lien is incurred (other than property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by the Lien shall not be incurred more than 18 months after the later of the acquisition, completion of construction, repair, improvement, addition or commencement of full operation of the property subject to the Lien;
(7) Liens existing on the Issue Date;
(8) Liens on property or shares of stock of a Person at the time such Person becomes a Subsidiary;provided, however, such Liens are not created or incurred in connection with, or in contemplation of, such other Person becoming such a Subsidiary;
(9) Liens on property at the time the Issuer or a Restricted Subsidiary acquired the property, including any acquisition by means of a merger or consolidation with or into the Issuer or any of its Restricted Subsidiaries;provided, however, that such Liens are not created or incurred in connection with, or in contemplation of, such acquisition, merger or consolidation;
(10) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to the Issuer or another Restricted Subsidiary;
(11) Liens securing Hedging Obligations so long as, in the case of Hedging Obligations related to interest, the related Indebtedness is secured by a Lien on the same property securing such Hedging Obligations;
(12) Liens on specific items of inventory of other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances or trade letters of credit issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(13) leases, subleases, licenses or sublicenses (including of intellectual property) granted to others in the ordinary course of business which do not materially interfere with the ordinary conduct of the business of the Issuer or any of its Restricted Subsidiaries and do not secure any Indebtedness;
(14) Liens arising from Uniform Commercial Code (or equivalent statute) financing statement filings regarding operating leases entered into by the Issuer and its Restricted Subsidiaries in the ordinary course of business;
(15) Liens in favor of the Issuer or any Guarantor;
(16) Liens on equipment of the Issuer or any of its Restricted Subsidiaries granted in the ordinary course of business;
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(17) Liens on accounts receivable and related assets incurred in connection with a Receivables Facility;
(18) Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancing, refunding, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in clause (b) of the second paragraph under "—Certain Covenants—Liens" and in the foregoing clauses (7), (8), (9) and (17);provided, however, that (a) such new Lien shall be limited to all or part of the same property that secured the original Lien (plus improvements on such property), and (b) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (i) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (7), (8), (9) and (17) at the time the original Lien became a Permitted Lien under the Indenture, and (ii) an amount necessary to pay any fees and expenses, including premiums, and accrued and unpaid interest related to such refinancing, refunding, extension, renewal or replacement;
(19) deposits made in the ordinary course of business to secure liability to insurance carriers;
(20) Liens on property or assets incurred in connection with any transaction permitted under the first paragraph of "Certain Covenants—Limitation on Sale and Lease-back Transactions";
(21) Liens securing judgments for the payment of money so long as such Liens are adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment have not been finally terminated or the period within which such proceedings may be initiated has not expired;
(22) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods in the ordinary course of business;
(23) Liens (i) of a collection bank arising under Section 4-210 of the Uniform Commercial Code or any comparable or successor provision on items in the course of collection, (ii) attaching to commodity trading accounts or other commodity brokerage accounts incurred in the ordinary course of business, and (iii) in favor of banking or other financial institutions arising as a matter of law encumbering deposits (including the right of set-off) and which are within the general parameters customary in the banking industry;
(24) Liens deemed to exist in connection with investments in repurchase agreements;provided that such Liens do not extend to any assets other than those that are the subject of such repurchase agreement;
(25) Liens encumbering reasonable customary initial deposits and margin deposits and similar Liens attaching to commodity trading accounts or other brokerage accounts incurred in the ordinary course of business and not for speculative purposes;
(26) Liens that are contractual rights of set-off (i) relating to the establishment of depository relations with banks not given in connection with the issuance of Indebtedness, (ii) relating to pooled deposit or sweep accounts of the Issuer or any of its Restricted Subsidiaries to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business of the Issuer and its Restricted Subsidiaries or (iii) relating to purchase orders and other agreements entered into with customers of the Issuer or any of its Restricted Subsidiaries in the ordinary course of business;
(27) Liens on the Equity Interests of Unrestricted Subsidiaries that secure Indebtedness of such Unrestricted Subsidiaries;
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(28) any encumbrance or restriction (including put and call arrangements) with respect to capital stock of any joint venture or similar arrangement pursuant to any joint venture or similar agreement; and
(29) Liens on property or assets used to defease or to irrevocably satisfy and discharge Indebtedness;provided that such defeasance or satisfaction and discharge is not prohibited by the Indenture.
For purposes of this definition, the term "Indebtedness" shall be deemed to include interest on and the costs in respect of such Indebtedness.
"Person" means any individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.
"Rating Agencies" means Moody's and S&P or if Moody's or S&P or both shall not make a rating on the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Issuer which shall be substituted for Moody's or S&P or both, as the case may be.
"Ratings Decline Period" means the period commencing on the earlier of (a) the first public notice of the occurrence of a Change of Control or (b) the public announcement by the Issuer of its intention to effect a Change of Control, and ending 60 days following consummation of such Change of Control (which period shall be extended so long as the rating of the applicable series of Notes is under publicly announced consideration for a possible rating downgrade by any of the Rating Agencies on such 60th day, such extension to last with respect to each such Rating Agency until the date on which such Rating Agency considering such possible downgrade either (x) rates the applicable series of Notes below Investment Grade or (y) publicly announces that it is no longer considering such Notes for possible downgrade,provided that no such extension shall occur if on such 60th day the applicable series of Notes is rated Investment Grade by at least one of such Rating Agencies in question and is not subject to review for possible downgrade by such Rating Agency).
"Receivables Facility" means any of one or more receivables financing facilities as amended, supplemented, modified, extended, renewed, restated or refunded from time to time, the Obligations of which are non-recourse (except for customary representations, warranties, covenants and indemnities made in connection with such facilities) to the Issuer or any of its Restricted Subsidiaries (other than a Receivables Subsidiary) pursuant to which the Issuer or any of its Restricted Subsidiaries sells its accounts receivable to either (a) a Person that is not a Restricted Subsidiary or (b) a Receivables Subsidiary that in turn sells its accounts receivable to a Person that is not a Restricted Subsidiary.
"Receivables Subsidiary" means any Subsidiary formed for the purpose of, and that solely engages only in one or more Receivables Facilities and other activities reasonably related thereto.
"Restricted Subsidiary" means, at any time, each direct and indirect Subsidiary of the Issuer (including any Foreign Subsidiary) that is not then an Unrestricted Subsidiary;provided, however, that upon the occurrence of an Unrestricted Subsidiary ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of "Restricted Subsidiary."
"S&P" means Standard & Poor's, a division of The McGraw-Hill Companies, Inc., and any successor to its rating agency business.
"Sale and Lease-Back Transaction" means any arrangement providing for the leasing by the Issuer or any of its Restricted Subsidiaries of any real or tangible personal property, which property has been or is to be sold or transferred for value by the Issuer or such Restricted Subsidiary to a third Person in contemplation of such leasing.
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"SEC" means the U.S. Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.
"Senior Credit Facilities" means the credit facility under the credit agreement dated as of October 11, 2013 by and among the Issuer, the Guarantors, the lenders party thereto in their capacities as lenders thereunder and Bank of America, N.A., as Administrative Agent, as amended or supplemented from time to time.
"Significant Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" as defined in Article 1, Rule 1-02(w)(1) or (2) of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date.
"Subordinated Indebtedness" means:
(1) any Indebtedness of the Issuer which is by its terms subordinated in right of payment to the Notes, and
(2) any Indebtedness of any Guarantor which is by its terms subordinated in right of payment to the Guarantee of such entity of the Notes.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association, or other business entity (other than a partnership, joint venture, limited liability company or similar entity) of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time of the
application full dividends, including cumulative dividends, upon sharesdetermination owned or controlled, directly or indirectly, by such Person or one or more of the preferred stock outstandingother Subsidiaries of that Person or a combination thereof; and
(2) any partnership, joint venture, limited liability company or similar entity of which
(x) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof whether in the form of membership, general, special or limited partnership or otherwise, and
(y) such Person or any Restricted Subsidiary of such Person is a controlling general partner or otherwise controls such entity.
"Treasury Rate" means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the redemption date (or, if such statistical release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to August 15, 2021 (in the case of 2021 Notes) or June 15, 2026 (in the case of 2026 Notes);provided, however, that if the period from the redemption date to August 15, 2021 (in the case of 2021 Notes) or June 15, 2026 (in the case of 2026 Notes) is less than one year, the weekly average yield on actively traded United States Treasury securities adjusted to a constant maturity of one year will be used.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended (15 U.S.C. §§ 77aaa-77bbbb).
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"Unrestricted Subsidiary" means:
(1) any Subsidiary of the Issuer which at the time of determination is an Unrestricted Subsidiary (as designated by the Issuer, as provided below); and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Issuer may designate any Subsidiary of the Issuer (including any existing Subsidiary and any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns or holds any Lien on, any property of, the Issuer or any Subsidiary of the Issuer (other than solely any Subsidiary of the Subsidiary to be so designated);provided that:
(1) any Unrestricted Subsidiary must be an entity of which the Equity Interests entitled to cast at least a majority of the votes that may be cast by all Equity Interests having ordinary voting power for the election of directors or Persons performing a similar function are owned, directly or indirectly, by the Issuer; and
(2) each of:
has not at the time of designation, and does not thereafter, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable with respect to any Indebtedness pursuant to which the lender has recourse to any of the assets of the Issuer or any Restricted Subsidiary.
Any such designation by the Issuer shall be notified by the Issuer to the Trustee by promptly delivering to the Trustee a copy of the resolution of the board of directors of the Issuer or any committee thereof giving effect to such designation and an Officer's Certificate certifying that such designation complied with the foregoing provisions.
"Voting Stock" of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the board of directors of such Person.
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BOOK-ENTRY, DELIVERY AND FORM
General
The new notes will be represented by one or more global notes in registered form without interest coupons attached (the "Global Notes"). The Global Notes will be deposited with a custodian for DTC, and registered in the name of Cede & Co., as nominee of DTC.
Ownership of interests in the Global Notes (the "Book-Entry Interests") will be limited to persons who have accounts with DTC, or persons who hold interests through such participants. DTC will hold interests in the Global Notes on behalf of its participants through customers' securities accounts in their respective names on the last dividend payment date have been paid or
declared and set apart for payment. In addition, any junior or parity preferred
stock or common stock may be converted into or exchanged for our stock ranking
junior tobooks of their respective depositaries. Except under the preferred stock as to dividends.
The amountlimited circumstances described below, owners of dividends payable for the initial dividend period or any
period shorter than a full dividend period shall be computed on the basis of a
360 day year of twelve 30 day months, unless otherwise set forthbeneficial interests in the applicable prospectus supplement. Accrued but unpaid dividends will not bear
interest, unless otherwise set forth in the applicable prospectus supplement.
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Redemption
All shares of any series of preferred stock will be redeemable to the
extent set forth in the prospectus supplement relating to the series. All shares
of any series of preferred stock will be convertible into shares of common stock
or into shares of any other series of preferred stock to the extent set forth in
the applicable prospectus supplement.
Liquidation Rights
Unless otherwise set forth in the applicable prospectus supplement, in the
event of our liquidation, dissolution or winding up, the holders of shares of
each series of preferred stock are entitled to receive out of our assets
available for distribution to stockholders, before any distribution of assets is
made to holders of (i) any other shares of preferred stock ranking junior to
that series of preferred stock as to rights upon liquidation, dissolution or
winding up and (ii) shares of common stock, liquidating distributions per share
in the amount of the liquidation preference specified in the applicable
prospectus supplement for that series of preferred stock plus any dividends
accrued and accumulated but unpaid to the date of final distribution. However,
the holders of each series of preferred stockGlobal Notes will not be entitled to receive physical delivery of certificated Notes.
Book-Entry Interests will be shown on, and transfers thereof will be done only through, records maintained in book-entry form by DTC and its participants. The laws of some jurisdictions, including certain states of the liquidating distributionUnited States, may require that certain purchasers of plussecurities take physical delivery of such dividendssecurities in definitive form. The foregoing limitations may impair your ability to own, transfer or pledge Book-Entry Interests. In addition, while the Notes are in global form, holders of Book-Entry Interests are not considered the owners or "holders" of Notes for any purpose.
So long as the Notes are held in global form, DTC (or its nominee) will be considered the sole holders of Global Notes for all purposes under the Indenture. In addition, participants in DTC must rely on those shares until the liquidation preferenceprocedures of DTC and indirect participants must rely on the procedures of DTC and the participants through which they own Book-Entry Interests, to transfer their interests or to exercise any rights of holders under the Indenture.
Neither the Issuer nor the Trustee for the new notes has any responsibility or liability for any aspect of the records relating to the Book-Entry Interests.
Redemption of the Global Notes
In the event any Global Note (or any portion thereof) is redeemed, DTC (or its nominee) will redeem an equal amount of the Book-Entry Interests in such Global Note from the amount received by it in respect of the redemption of such Global Note. The redemption price payable in connection with the redemption of such Book-Entry Interests will be equal to the amount received by DTC in connection with the redemption of such Global Note (or any portion thereof). The Issuer understands that, under existing practices of DTC, if fewer than all of a series of Notes are to be redeemed at any time, DTC will credit its participants' accounts on a proportionate basis (with adjustments to prevent fractions) or by lot or on such other basis as it deems fair and appropriate; provided, however, that no Book-Entry Interest of $2,000 principal amount or less may be redeemed in part.
Payments on Global Notes
The Issuer will make payments of any shares of our capital stock ranking senior to that
seriesamounts owing in respect of the preferred stockGlobal Notes (including principal, premium, if any, and interest and all other amounts payable) to DTC or its nominee, which will distribute such payments to participants in accordance with its procedures. The Issuer will make payments of all such amounts without deduction or withholding for or on account of any present or future taxes, duties, assessments or governmental charges of whatever nature except as may be required by law. The Issuer expects that standing customer instructions and customary practices will govern payments by participants to owners of Book-Entry Interests held through such participants.
Under the rights upon liquidation, dissolution or
winding up shall have been paid (or a sum set aside therefor sufficient to
provide for payment) in full.
If upon our liquidation, dissolution or winding up,terms of the amounts payable
with respect toIndenture, the preferred stock,Issuer and any other preferred stock ranking as to
any distribution on a parity with the preferred stock are not paid in full, thenTrustee will treat the registered holders of the preferred stockGlobal Notes (i.e., DTC (or its nominee)) as the owners thereof for the purpose of receiving
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payments and for all other purposes. None of the Issuer, the Trustee or any of their respective agents has or will have any responsibility or liability for:
- •
- any aspect of the records of DTC or any participant or indirect participant relating to payments made on account of a Book-Entry Interest or for maintaining, supervising or reviewing the records of DTC, or any participant or indirect participant relating to or payments made on account of a Book-Entry Interest; or
- •
- DTC or any participant or indirect participant.
Payments by participants to owners of Book-Entry Interests held through participants are the responsibility of such participants.
Currency of Payment for the Global Notes
Except as may otherwise be agreed between DTC and any holder, the principal of, premium, if any, and interest on, and all other amounts payable in respect of, the Global Notes will be paid to holders of interests in such Notes through DTC in U.S. dollars.
Payments will be subject in all cases to any fiscal or other laws and regulations (including any regulations of the applicable clearing system) applicable thereto. None of the Issuer, the Trustee or any of their respective agents will be liable to any holder of a Global Note or any other person for any commissions, costs, losses or expenses in relation to or resulting from any currency conversion or rounding effected in connection with any such payment.
Action By Owners of Book-Entry Interests
DTC has advised the Issuer that it will take any action permitted to be taken by a holder of Notes (including the presentation of Notes for exchange as described below) only at the direction of one or more participants to whose account the Book-Entry Interests in the Global Notes are credited and only in respect of such portion of the aggregate principal amount of Notes as to which such participant or participants have or have given such direction. DTC will not exercise any discretion in the granting of consents, waivers or the taking of any other action in respect of the Global Notes. However, if there is an event of default under the Notes, DTC reserves the right to exchange the Global Notes for definitive registered Notes in certificated form (the "Definitive Registered Notes"), and to distribute Definitive Registered Notes to its participants.
Transfers
Transfers of beneficial interests in the Global Notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, which rules and procedures may change from time to time.
Any Book-Entry Interest in one of the Global Notes that is transferred to a person who takes delivery in the form of a Book-Entry Interest in any other Global Note of the same series will, upon transfer, cease to be a Book-Entry Interest in the first-mentioned Global Note and become a Book-Entry Interest in such other Global Note, and accordingly will thereafter be subject to all transfer restrictions, if any, and other procedures applicable to Book-Entry Interests in such other Global Note for as long as it remains such a Book-Entry Interest.
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Definitive Registered Notes
Under the terms of the Indenture, owners of the Book-Entry Interests will receive Definitive Registered Notes:
- •
- if DTC notifies the Issuer that it is unwilling or unable to continue as depositary for the Global Note, or DTC ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended (the "Exchange Act") and, in either case, a qualified successor depositary is not appointed by the Issuer within 90 days;
- •
- if an event of default under the applicable indenture occurred or is continuing and the
other parity preferred stock will
share ratablyowner of a Book-Entry Interest requests such exchange in any distributionwriting delivered through DTC.
In the case of assets in proportionthe issuance of Definitive Registered Notes, the holder of a Definitive Registered Note may transfer such Note by surrendering it to the full respective
preferential amountregistrar. In the event of a partial transfer or a partial redemption of a holding of Definitive Registered Notes represented by one Definitive Registered Note, a Definitive Registered Note shall be issued to which they are entitled. Unless otherwise specifiedthe transferee in respect of the part transferred, and a new Definitive Registered Note in respect of the balance of the holding not transferred or redeemed shall be issued to the transferor or the holder, as applicable; provided that no Definitive Registered Note in a prospectus supplementdenomination less than $2,000 shall be issued. The Issuer will bear the cost of preparing, printing, packaging and delivering the Definitive Registered Notes.
The Issuer shall not be required to register the transfer or exchange of Definitive Registered Notes for a period of 15 calendar days preceding (a) the record date for any payment of interest on the applicable series of preferred stock, after paymentNotes, (b) any date fixed for redemption of the full
amountapplicable series of Notes or (c) the date fixed for selection of the liquidating distributionseries of Notes to which they are entitled,be redeemed in part. Also, the holdersIssuer is not required to register the transfer or exchange of sharesany Notes selected for redemption. In the event of preferred stock will not be entitledthe transfer of any Definitive Registered Note, the transfer agent may require a holder, among other things, to furnish appropriate endorsements and transfer documents as described in the applicable indenture. The Issuer may require a holder to pay any further participation
in any distribution of our assets. Neither a consolidation or merger of us with
another corporation nor a sale of securities shall be considered a liquidation,
dissolution or winding up of us.
Voting Rights
The holders of each series or class of preferred stock we may issue will
have no voting rights, except astaxes and fees required by law and as described below or in
the applicable prospectus supplement. Our board of directors may, upon issuance
of a series or class of preferred stock, grant voting rights to the holders of
that series or class to elect additional board members if we fail to pay
dividends in a timely fashion.
Unless otherwise set forth in an applicable prospectus supplement, without
the affirmative vote of a majority of the shares of any class of preferred stock
then outstanding, we may not:
o increase or decrease the aggregate number of authorized shares of that
class;
o increase or decrease the par value of the shares of that class; or
o alter or change the powers, preferences or special rights of the
shares of that class so as to affect them adversely.
If the amendment would adversely alter or change the powers, preferences or
special rights of one or more series of a class of preferred stock, but not the
entire class, then only the shares of the affected series will have the right to
vote on the amendment.
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Miscellaneous
Unless otherwise set forth in an applicable prospectus supplement, the
holders of our preferred stock will have no preemptive rights. All shares of
preferred stock being offeredpermitted by the applicable prospectus supplement willindenture and the applicable series of Notes.
If Definitive Registered Notes are issued and a holder thereof claims that such Definitive Registered Notes have been lost, destroyed or wrongfully taken or if such Definitive Registered Notes are mutilated and are surrendered to the registrar or at the office of a transfer agent, the Issuer shall issue and the Trustee shall authenticate a replacement Definitive Registered Note if the Trustee's and the Issuer's requirements are met. The Trustee or the Issuer may require a holder requesting replacement of a Definitive Registered Note to furnish an indemnity bond sufficient in the judgment of both the Trustee and the Issuer to protect the Issuer, the Trustee or the paying agent appointed pursuant to the applicable indenture from any loss which any of them may suffer if a Definitive Registered Note is replaced. The Issuer may charge for its expenses in replacing a Definitive Registered Note.
In case any such mutilated, destroyed, lost or stolen Definitive Registered Note has become or is about to become due and payable, or is about to be fully paid and not liableredeemed or purchased by the Issuer pursuant to further calls or assessment by us. If we shouldthe provisions of the indenture, the Issuer in its discretion may, instead of issuing a new Definitive Registered Note, pay, redeem or otherwise reacquire shares of our preferred stock, then these shares
will resumepurchase such Definitive Registered Note, as the status of authorizedcase may be.
Definitive Registered Notes may be transferred and unissued shares of preferred stock
undesignated as to series, and will be availableexchanged for subsequent issuance. There
are no restrictions on repurchase or redemptionBook-Entry Interests in a Global Note only in accordance with the applicable indenture.
Information Concerning DTC
The following description of the preferred stock while
thereoperations and procedures of DTC is any arrearage on sinking fund installments exceptprovided solely as may be set forth
in an applicable prospectus supplement. Paymenta matter of dividends on any seriesconvenience. These operations and procedures are solely within the control of preferred stock may be restrictedDTC and are subject
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to changes by loan agreements, indenturesDTC. We take no responsibility for these operations and otherprocedures and urge investors to contact DTC or its participants directly to discuss these matters.
The Issuer understands as follows with respect to DTC:
DTC is:
- •
- a limited purpose trust company organized under the New York Banking Law;
- •
- a "banking organization" under New York Banking Law;
- •
- a member of the Federal Reserve System;
- •
- "clearing corporation" within the meaning of the New York Uniform Commercial Code; and
- •
- a "clearing agency" registered under Section 17A of the Exchange Act.
DTC was created to hold securities for its participants and to facilitate the clearance and settlement of transactions entered into by us. Any material contractual restrictions on
dividend payments will be described or incorporated by referenceamong its participants. It does this through electronic book-entry changes in the applicable prospectus supplement.
When we offeraccounts of securities participants, eliminating the need for physical movement of securities certificates. DTC participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. DTC's owners are the New York Stock Exchange, Inc., NYSE MKT LLC, the Financial Industry Regulatory Authority, Inc. and a number of DTC's direct participants. Others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a direct participant also have access to sellthe DTC system and are known as indirect participants.
Because DTC can only act on behalf of participants, who in turn act on behalf of indirect participants and certain banks, the ability of an owner of a series of preferred stock, we will describe the
specific terms of the seriesbeneficial interest to pledge such interest to persons or entities that do not participate in the applicable prospectus supplement. If any
particular terms of a series of preferred stock described in a prospectus
supplement differ from any of the terms described in this prospectus, then the
terms described in the applicable prospectus supplement will be deemed to
supersede the terms described in this prospectus.
No Other Rights
The shares of a series of preferred stock will not have any preferences,
voting powersDTC system, or relative, participating, optional or other special rights
except as set forth above or in the applicable prospectus supplement, our
charter or the applicable certificate of designation or as otherwise required by
law.
Transfer Agent
The transfer agent and registrar for each series of preferred stock will be
designated in the applicable prospectus supplement.
DESCRIPTION OF WARRANTS
We may issue, either separately or together with other securities, warrants
for the purchase of any of the other types of securities that we may sell under
this prospectus.
The warrants will be issued under warrant agreements to be entered into
between us and a bank or trust company, as warrant agent, all to be set forth in
the applicable prospectus supplement relating to any or all warrantstake actions in respect of which this prospectussuch interest, may be limited by the lack of a definitive certificate for that interest. The laws of some states require that certain persons take physical delivery of securities in definitive form. Consequently, the ability to transfer beneficial interests to such persons may be limited. In addition, owners of beneficial interests through the DTC system will receive distributions attributable to the Global Notes only through DTC participants.
Global Clearance and Settlement Under the Book-Entry System
The Notes are expected to trade in DTC's Same-Day Funds Settlement System and any permitted secondary market trading activity in the Notes will, therefore, be required by DTC to be settled in immediately available funds. The Issuer expects that secondary trading in any certificated Notes will also be settled in immediately available funds. Cross-market transfers of Book-Entry Interests in the Notes between the participants in DTC will be done through DTC in accordance with DTC's rules.
Although DTC is being delivered. Copiesexpected to follow the foregoing procedures in order to facilitate transfers of interests in the Global Notes among participants in DTC, it is under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. None of the formIssuer, the Trustee, the registrar, any transfer agent or any paying agent will have any responsibility for the performance by DTC or its participants or indirect participants, of agreementtheir respective obligations under the rules and procedures governing their operations.
Initial Settlement
Initial settlement for each warrant, which we refer to collectively as "warrant agreements," including
the forms of certificates representing the warrants, which we refer to
collectively as "warrant certificates" and reflecting the provisions to be
included in such agreements thatNotes will be entered into with respectmade in dollars. Book-Entry Interests owned through DTC accounts will follow the settlement procedures applicable to conventional Eurobonds in registered form. Book-Entry Interests will be credited to the particular offeringssecurities custody accounts of each typeDTC, holders on the business day following the settlement date against payment for value on the settlement date.
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Secondary Market Trading
The Book-Entry Interests will trade through participants of DTC and will settle in same day funds. Since the purchase determines the place of delivery, it is important to establish at the time of trading of any Book-Entry Interests where both the purchaser's and the seller's accounts are located to ensure that settlement can be made on the desired value date.
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REGISTRATION RIGHTS
We have been or will be filed as
exhibits to the registration statement (the "exchange offer registration statement") of which this prospectus forms a part or
as exhibits to documents which have been or will be incorporated by referenceand are conducting the exchange offer in this prospectus.
The following description sets forth certain general termsaccordance with our obligations under the registration rights agreement entered into between us and provisionsthe initial purchasers of the warrants to which any prospectus supplement may relate. The particular
termsold notes. Holders of the warrantsnew notes will not be entitled to which any prospectus supplement may relate and the
extent, if any, to which the general provisions may applyregistration rights with respect to the warrants so
offered will be describednew notes.
Pursuant to the registration rights agreement, we agreed, at our own cost, for the benefit of the holders of old notes, to use commercially reasonable efforts to file this exchange offer registration statement with respect to an offer to exchange each series of old notes for new notes with the same aggregate principal amount and terms substantially identical in all material respects to the applicable prospectus supplement. Theseries of old notes (except for the provisions relating to the transfer restrictions and payment of additional interest); to cause the exchange offer registration statement to be declared effective by the SEC under the Securities Act; and to consummate the exchange offer not later than the 365th day following summary of certain provisionsthe closing of the warrants, warrant agreements and warrant
certificates doesoffering of old notes (the "Exchange Date").
In the event that this exchange offer is not purportconsummated with respect to be complete and iseither series on or prior to the Exchange Date, we will, subject to and is qualified
in its entirety by express referencecertain conditions, at our own cost,
(1) file a shelf registration statement with the SEC with respect to all the provisionsa series covering resales of such series of the warrant
agreements and warrant certificates, including the definitions therein of
certain terms.
General
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The prospectus supplement shall set forth the terms of the warrants in
respect of which this prospectus is being delivered as well as the related
warrant agreement and warrant certificates, including the following, where
applicable:
o the principal amount of,old notes or the number of securities,new notes, as the case may be;
(2) thereafter use commercially reasonable efforts to cause such shelf registration statement to be purchasable upon exercisedeclared effective under the Securities Act; and
(3) use commercially reasonable efforts to keep the shelf registration statement continuously effective until the second anniversary of the date of issuance of the old notes of such series or such shorter period that will terminate when all notes covered thereby are disposed of in accordance therewith or cease to be outstanding.
We will, in the event a shelf registration statement with respect to a series is filed, among other things, provide to each warrantholder for whom such shelf registration statement was filed copies of the prospectus which is a part of the shelf registration statement, notify each such holder when the shelf registration statement has become effective and take certain other actions as are required to permit unrestricted resales of the initial price at
whichold notes or the principal amount or number of securities,new notes, as the case may be. A holder selling such old notes or new notes pursuant to the shelf registration statement generally would be mayrequired to be purchased upon such exercise;
onamed as a selling security holder in the designationrelated prospectus and termsto deliver a prospectus to purchasers, will be subject to certain of the securities, if other than common
stock, purchasable upon exercise thereofcivil liability provisions under the Securities Act in connection with such sales. We may require each holder of old notes or new notes to be sold pursuant to the shelf registration statement to furnish to us such information regarding the holder and the distribution of the old notes or new notes by the holder as we may from time to time reasonably require for inclusion in the shelf registration statement, and we may exclude from such registration the old notes or new notes of any securities, if
other than common stock,holder that fails to furnish us with whichsuch information within a reasonable amount of time after receiving such request.
If neither (1) the warrants are issued;
o the procedures and conditions relatingexchange offer with respect to a series of old notes has been consummated on or prior to the exerciseExchange Date nor (2) a shelf registration statement covering resales of the
warrants;
o the date, if any,such series of old notes has been filed and been declared or otherwise become effective on and after which the warrants, and any securities
with which the warrants are issued, will be separately transferable;
o the offering price of the warrants, if any;
o the date on which the right to exercise the warrants will commence and
the date on which that right will expire;
o a discussion of any material United States federal income tax
considerations applicableor prior to the exercise ofExchange Date (together, a "registration default"), then additional interest will accrue on the warrants;
o whether the warrants represented by the warrant certificates will be
issued in registered or bearer form, and, if registered, where they
may be transferred and registered;
o call provisions of the warrants, if any;
o antidilution provisions of the warrants, if any; and
o any other material terms of the warrants.
Exercise of Warrants
Each warrant will entitle the holder to purchase for cash thataggregate principal amount of or number of securities, as the case may be, at the exercise price set
forth in, or to be determined as set forth in, the applicable prospectus
supplement relating to the warrants. Unless otherwise specified in the
applicable prospectus supplement, warrants may be exercised at the corporate
trust office of the warrant agent or any other office indicated in the
applicable prospectus supplement at any time up to 5:00 p.m. New York City time
on the expiration date set forth in the applicable prospectus supplement. After
5:00 p.m. New York City time on the expiration date, unexercised warrants will
become void. Upon receipt of payment and the warrant certificate properly
completed and duly executed, we will, as soon as practicable, issue the
securities purchasable upon exercise of the warrant. If less than all of the
warrants represented by the warrant certificate are exercised, a new warrant
certificate will be issued for the remaining amount of warrants.
No Rights of Security Holder Prior to Exercise
Prior to the exercise of their warrants, holders of warrants will not have
any of the rights of holders of the securities purchasable upon then exercise of
the warrants, and will not be entitled to:
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o in the case of warrants to purchase debt securities, payments of
principal of, premium, if any, or interest, if any, on the debt
securities purchasable upon exercise; or
o in the case of warrants to purchase equity securities, the right to
vote or to receive dividend payments or similar distributions on the
securities purchasable upon exercise.
Exchange of Warrant Certificates
Warrant certificates will be exchangeable for new warrant certificates of
different denominations at the corporate trust office of the warrant agent or
any other office indicated in the applicable prospectus supplement.
DESCRIPTION OF RIGHTS
We may issue rights for the purchase of shares of preferred stock or common
stock. Eachsuch series of rights will be issued under a separate rights agreement
between us and a bank or trust company, allold notes as set forth in the prospectus
supplement relating to the particular issue of rights. The bank or trust company
will act solely as our agent in connection with the certificates relating to the
rights and will not assume any obligation or relationship of agency or trust for
or with any holders of rights certificates or beneficial owners of rights. The
rights agreement and the rights certificates relating to each series of rights
have been or will be filed as exhibits towhich the registration statement of which
this prospectus forms a part or as exhibits to documents which have been or will
be incorporated by reference in this prospectus.
The applicable prospectus supplement will describe the terms of the rights
to be issued,default pertains from and including the following where applicable:
o the date for determining the stockholders entitled to the rights
distribution;
o the aggregate number of shares of preferred stock or common stock
purchasable upon exercise of such rights and the exercise price;
o the aggregate number of rights being issued;
o the date, if any, on and after which such rights may be transferable
separately;
o the date on which the right to exercise such rights shall commence and the date on which such right shall expire;
o any special United States federal income tax consequences;registration default has occurred to but excluding the date on which such registration default has been cured with respect to the applicable series of notes. Additional interest will accrue at a rate of 0.25% for the first 90 day period after such date and othereafter it will be increased by an additional 0.25% for each subsequent 90 day period that elapses, provided that the
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aggregate increase in such annual interest rate may in no event exceed 0.50% per annum over the applicable rate of such series of old notes, i.e. 2.300% and 3.400% in respect of the old 2021 Notes and the old 2026 Notes, respectively. We will pay such additional interest on regular interest payment dates. Such additional interest will be in addition to any other terms of such rights, including terms, procedures and
limitations relating to the distribution, exchange and exercise of
such rights.
DESCRIPTION OF PURCHASE CONTRACTS
We may issue,interest payable from time to time purchase contracts, including contracts
obligating holders to purchase from us and us to sellwith respect to the holders,applicable series of the old notes and the new notes.
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U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a specified principal amountsummary of debtU.S. federal income tax considerations generally applicable to the exchange of old notes for new notes pursuant to the exchange offer, as of the date hereof. This discussion does not address specific tax considerations that may be relevant to particular persons in light of their individual circumstances (including, for example, entities treated as partnerships for U.S. federal income tax purposes or partners or members therein, banks or other financial institutions, broker-dealers, insurance companies, regulated investment companies, tax-exempt entities, common trust funds, controlled foreign corporations, dealers in securities or currencies, and persons in special situations, such as those who hold notes as part of a specified numberstraddle, synthetic security, conversion transaction, or other integrated investment comprising notes and one or more other investments). In addition, this discussion does not describe any tax considerations arising under U.S. federal gift, estate or other tax laws, or under the tax laws of sharesany state, local or foreign jurisdiction. This discussion is based upon the Internal Revenue Code of common stock or preferred stock or any1986, as amended, the Treasury Department regulations promulgated thereunder, and administrative and judicial interpretations thereof, all as of the date hereof and all of which are subject to change, possibly with retroactive effect. Each holder is urged to consult its tax advisor regarding the U.S. federal, state, local and non-U.S. income and other securitiestax considerations relating to the exchange of old notes for new notes and relating to the acquisition, ownership and disposition of the new notes.
The exchange of an old note for a new note pursuant to the exchange offer will not constitute a "significant modification" of the old note for U.S. federal income tax purposes and, accordingly, the new note received by a holder will be treated as a continuation of the old note in the hands of such holder. As a result, there will be no U.S. federal income tax consequences to a holder who exchanges an old note for a new note pursuant to the exchange offer and any such holder will have the same adjusted tax basis and holding period in the new note as it had in the old note immediately before the exchange. A holder who does not exchange its old notes for new notes pursuant to the exchange offer will not recognize any gain or loss, for U.S. federal income tax purposes, upon consummation of the exchange offer.
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PLAN OF DISTRIBUTION
Each broker-dealer that receives new notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of the new notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of new notes received in exchange for old notes where such old notes were acquired as a result of market making activities or other trading activities. We have agreed that, for a period of 90 days after the completion of the exchange offer, we may sell
underwill make this prospectus, at a future dateas amended or dates. The consideration payable upon
settlementsupplemented, available to any broker-dealer for use in connection with any such resale. During this period, we will send copies of this prospectus, as amended or supplemented, to those broker-dealers that check the purchase contractsbox on the letter of transmittal accompanying this prospectus requesting additional copies of this prospectus.
We will not receive any proceeds from any sale of new notes by broker-dealers. New notes received by broker-dealers for their own account pursuant to the exchange offer may be fixedsold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the new notes or a combination of such methods of resale, at market prices prevailing at the time the purchase
contracts are issuedof resale, at prices related to such prevailing market prices or at negotiated prices. Any such resale may be determined by a specific referencemade directly to a formula
set forthpurchasers or to or through brokers or dealers who may receive compensation in the purchase contracts. The purchase contractsform of commissions or concessions from any such broker-dealer or the purchasers of any such new notes. Any broker-dealer that resells new notes that were received by it for its own account as a result of market-making or other trading activities pursuant to the exchange offer and any broker or dealer that participates in a distribution of such new notes may be issued
separatelydeemed to be an "underwriter" within the meaning of the Securities Act and any profit on any such resale of new notes and any commission or as part of units consisting of a purchase contract and other
securities or obligations issuedconcessions received by us or third parties, including United States
treasury securities, securing the holders'
31
obligationsany such persons may be deemed to purchase the relevant securitiesbe underwriting compensation under the purchase contracts.Securities Act. The purchase contracts may require usletter of transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to make periodic paymentsadmit that it is an "underwriter" within the meaning of the Securities Act.
For a period of 90 days after the expiration date, we will send additional copies of this prospectus and any amendment or supplement to this prospectus to any broker-dealer that requests such documents in the letter of transmittal. We have agreed to pay all expenses incident to the exchange offer other than commissions or concessions of any brokers or dealers or transfer taxes, if any, and will indemnify the holders of the purchase contracts or units or vice versa, and the payments may be
unsecured or prefunded on some basis. The purchase contracts may require holders
to secure their obligationsold notes (including any broker-dealers) against certain liabilities, including liabilities under the purchase contracts.
The prospectus supplement will describeSecurities Act.
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LEGAL MATTERS
Certain matters with respect to the termsvalidity of any purchase
contracts. The description in the prospectus supplement will not necessarily be
complete andnew notes will be qualifiedpassed upon for us by Skadden, Arps, Slate, Meagher & Flom LLP, New York, New York.
EXPERTS
The financial statements and management's assessment of the effectiveness of internal control over financial reporting (which is included in its entiretyManagement's Report on Internal Control over Financial Reporting) incorporated in this Prospectus by reference to the purchase
contracts, and, if applicable, collateral arrangements and depositary
arrangements, relating to the purchase contracts.
DESCRIPTION OF UNITS
We may, from time to time, issue units comprised of one or more of the
other securities that may be offered under this prospectus, in any combination.
Each unit will be issued so that the holder of the unit is also the holder of
each security included in the unit. Thus, the holder of a unit will have the
rights and obligations of a holder of each included security. The unit agreement
under which a unit is issued may provide that the securities included in the
unit may not be held or transferred separately at any time, or at any time
before a specified date.
Any applicable prospectus supplement will describe:
o the material terms of the units and of the securities comprising the
units, including whether and under what circumstances those securities
may be held or transferred separately;
o any material provisions relating to the issuance, payment, settlement,
transfer or exchange of the units or of the securities comprising the
units; and
o any material provisions of the governing unit agreement that differ
from those described above.
LEGAL MATTERS
The validity of the securities offered by this prospectus will be passed
upon by Bryan Cave LLP, 1290 Avenue of the Americas, New York, New York 10104.
Kenneth L. Henderson, one of our directors, is a partner of Bryan Cave LLP. In
addition, Bryan Cave LLP owns approximately 14,250 shares of our common stock.
EXPERTS
Our consolidated financial statements and schedule for the year ended March
31, 2000, have been incorporated by reference herein and in this registration
statement in reliance upon the report of KPMG LLP, independent accountants,
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing.
The consolidated financial statements as of and for the years ended March
31, 2001 and March 31, 2002, incorporated in this prospectus by reference to the
Annual Report on Form 10-K for the year ended MarchDecember 31, 20022016 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent accountants,registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
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WHERE YOU CAN FIND MORE INFORMATIONINFORMATION; INCORPORATION BY REFERENCE
We are a reporting company and file annual, quarterly and specialcurrent reports, proxy statements and other information with the Securities and Exchange
Commission, or the SEC. You may read and copy such materialany document we file at the SEC's Public Reference Room maintained by the SEC at 450 Fifth100 F Street, N.W.N.E., Room 1580, Washington, D.C. 20549. Please call the 32
SEC at 1 800 SEC 03301-800-SEC-0330 for morefurther information on the operation of the Public Reference Room. YouThe SEC also maintains a website atwww.sec.gov that contains reports, proxy statements and other information regarding issuers that file electronically with the SEC, including the Issuer. These reports, proxy statements and other information can also findbe read through the investor relations section of our SEC filingswebsite at the SEC's web site at
http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" information that we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an importantinvestor.activision.com. Information on our website does not constitute part of this prospectus and information that we file latershould not be relied upon in connection with the SEC will automatically update and supersede this information.making any investment decision with respect to our securities.
We incorporate by reference into this prospectus the documents listed below, and any future filingsdocuments that we will makefile with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
of 1934:
o OurAct:
- •
- our Annual Report on Form 10-K for the fiscal year ended
March 31,
2002;
o Our Quarterly Reports on Form 10-Q for the quarterly periods ended
June 30, 2002, September 30, 2002 and December 31, 2002;
o Our2016 (as filed with the SEC on February 28, 2017);
- •
- our Current Reports on Form 8-K, filed on
May 22, 2002, June 5, 2002February 6, 2017 and June 6, 2002;February 9, 2017 (Item 8.01 only); and
o The description
- •
- the portions of our
common stock and the rights associated with our
common stock contained in our RegistrationDefinitive Proxy Statement on Form S-3,
Registration No. 333-46425, andSchedule 14A, filed April 22, 2016, that are incorporated by reference into our Registration StatementAnnual Report on Form 8-A, File No. 001-15839, filed on April 19, 2000.
We filed a registration statement10-K for the fiscal year ended December 31, 2015.
Information furnished under Items 2.02 or 7.01 in any future current report on Form S-4 to register with the SEC the
securities described in this prospectus. This prospectus is part of8-K that
registration statement. As permitted by SEC rules, this prospectus does not
contain all of the information included in the registration statement and the
accompanying exhibits and schedules we file with the SEC. You may referSEC (or corresponding information furnished under Item 9.01 or included as an exhibit), unless otherwise specified in such report, is not incorporated by reference in this prospectus, nor are there any other documents or information that is deemed to have been "furnished" and not "filed" with the registration statementSEC.
Except as provided above, no other information, including information on our website, is incorporated by reference in this prospectus.
We will provide to each person to whom a prospectus is delivered, upon written or oral request and the exhibits and schedules for more information about
us and our securities. The registration statement and exhibits and schedules are
also available at the SEC's Public Reference Room or through its web site.
You may requestwithout charge, a copy of these filings at no cost,the document(s) referred to above that we have incorporated by writingreference into this prospectus. You can request copies of such document(s) if you write or telephoningcall us at the following address:address or telephone number: Investor Relations, Activision Blizzard, Inc., 3100 Ocean Park Boulevard, Santa Monica, CaliforniaCA, 90405, (310) 255-2000
Attn: Investor Relations
You should rely only on255-3000, or you may visit the information contained or incorporated in this
prospectus or any supplement. We have not authorized anyone else to provide you
with different information. You should not rely on any other representations.
Our affairs may change after this prospectus or any supplement is distributed.
You should not assume that the information in this prospectus or any supplement
is accurate asinvestor relations section of our website at http://investor.activision.com for copies of any date other than the date on the frontsuch document.
Table of those documents.
You should read all information supplementing this prospectus.
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PartContents
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law ("DGCL"), paragraphs A
and B of Article SIXTH of the Company's Amended and Restated CertificateState of Incorporation, as amended (the "Certificate of Incorporation"Delaware ("DGCL"), and paragraph 5
of Article VII provides, generally, that a corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding (except actions by or in the right of the Company's Amended and Restated By-laws (the "By-Laws")
provide for the indemnificationcorporation) by reason of the Company's directorsfact that such person is or was a director, officer, employee or agent of the corporation against all expenses, judgments, fines and officersamounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a variety of circumstances, which may include liabilities undermanner such person reasonably believed to be in or not opposed to the Securities Act
of 1933, as amended (the "Securities Act").
Paragraph B of Article SIXTHbest interests of the Certificate of Incorporation provides
mandatory indemnification rightscorporation and, with respect to any officercriminal action or directorproceeding, had no reasonable cause to believe his or her conduct was unlawful. A corporation may similarly indemnify such person for expenses actually and reasonably incurred by such person in connection with the defense or settlement of any action or suit by or in the right of the Companycorporation,provided that such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, in the case of claims, issues and matters as to which such person shall have been adjudged liable to the corporation,provided that a court shall have determined, upon application, that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper.
Our bylaws provide that we will, to the fullest extent permitted by the DGCL, indemnify each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was one of our officers or directors or, while a director or officer, is or was serving at our request as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an officer or director ofemployee benefit plan, where the Company,
is involved in a legal proceeding of any nature. Such indemnification rights
shall include reimbursement for expenses incurred by such officer or director in
advance of the final dispositionbasis of such proceeding is alleged action in accordancean official capacity as a director, officer, employee or agent or in any other capacity while serving as a director, officer, employee or agent, against all expense, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such person in connection with the
applicable provisionssuch action, suit or proceeding; provided, however, that, except with respect to proceedings to enforce rights to indemnification, we will indemnify such person in connection with a proceeding initiated by such person only if such proceeding was authorized by our board of directors.
Section 102(b)(7) of the DGCL. Paragraph 5DGCL provides, generally, that our certificate of Article VII of the Company's
By-laws currently provides that the Company shall indemnify its directors and
officers to the fullest extent permitted by the DGCL.
Paragraph A of Article SIXTH of the Certificate of Incorporation containsincorporation may contain a provision which eliminateseliminating or limiting the personal liability of a director to the Company
andcorporation or its stockholders for certain breachesmonetary damages for breach of his or her fiduciary duty of care
as a director. Thisdirector,provided that such provision doesmay not however, eliminate or limit the personal liability of a director (i) for any breach of suchthe director's duty of loyalty to the Companycorporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under section 174 of the Delaware statutory provision making directors personally liable, under a
negligence standard, for unlawful dividends or unlawful stock repurchases or
redemptions,DGCL, or (iv) for any transaction from which the director derived an improper personal benefit. ThisNo such provision offers persons who serve onmay eliminate or limit the Boardliability of Directors of the Company protection against awards of monetary damages
resulting from negligent (except as indicated above) and "grossly" negligent
actions taken in the performance of their duty of care, including grossly
negligent business decisions made in connection with takeover proposals for the
Company. As a result of this provision, the ability of the Company or a
stockholder thereof to successfully prosecute an action against a director for a
breachany act or omission occurring prior to the date when such provision became effective. Our certificate of his dutyincorporation limits the liability of care has been limited. However,our directors to the provision does not
affectfullest extent permitted by the availability of equitable remedies such as an injunction or
rescission based upon a director's breach of his duty of care.
The Company maintainsDGCL.
We maintain a directors' and officers' insurance policy which insures theour officers and directors of the Company fromfor any claim arising out of an alleged wrongful act by such persons in their respective capacities as one of our officers and directors of the Company.or directors.
In addition, the Company haswe have entered into indemnification agreements with itscertain of our directors and officers and directors containing provisions
which are in some respects broader than the specific indemnification provisions
contained in the DGCL. The indemnification agreementsthat require the Company,us, among other things, to indemnify such officers and directorspersons against certain liabilities that may arise by reason of
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Table of Contents
their status or service as directors or officers (other than liabilities arising from willful misconduct of a culpable
nature) and, in some cases, to advance their expenses incurred by them as a result of any proceeding against them as to which they could be indemnified. The Company believes that
these agreements are necessary to attract and retain qualified persons as
directors and officers.
It is currently unclear as a matter of law what impact these provisions
will have regarding securities law violations. The Commission takes the position
that indemnification of directors, officers and controlling persons against
liabilities arising under the Securities Act is against public policy as
expressed in the Securities Act and therefore is unenforceable.
II-1
Item 21. Exhibits (a) Exhibits:
3.1 Our Amended and Restated Certificate of Incorporation, dated June
1, 2000 (incorporated by reference to Exhibit 2.5 of our Current
Report on Form 8-K, filed on June 16, 2000).
3.2 Our Certificate of Amendment of Amended and Restated Certificate
of Incorporation, dated June 9, 2000 (incorporated by reference
to Exhibit 2.7 of our Current Report on Form 8-K, filed on June
16, 2000).
3.3 Our Certificate of Amendment of Amended and Restated Certificate
of Incorporation, dated August 23, 2001 (incorporated by
reference to Exhibit 3.3 of Amendment No. 1 to our RegistrationFinancial Statement on Form S-3, Registration No. 333-66280, filed on
August 31, 2001).
3.4 Our Certificate of Designation of Series A Junior Preferred
Stock, dated December 27, 2001 (incorporated by reference to
Exhibit 3.4 of our Quarterly Report on Form 10-Q for the
quarterly period ended December 31, 2001).
3.5 Our Amended and Restated By-laws dated August 1, 2000
(incorporated by reference to Exhibit 3.2 of our Current Report
on form 8-K, filed July 11, 2001).
4.1 Rights Agreement dated as of April 18, 2000, between us and
Continental Stock Transfer & Trust Company, which includes as
exhibits the form of Right Certificates as Exhibit A, the Summary
of Rights to Purchase Series A Junior Preferred Stock as Exhibit
B and the form of Certificate of Designation of Series A Junior
Preferred Stock of Activision as Exhibit C, (incorporated by
reference to our Registration Statement on Form 8-A, Registration
No. 001-15839, filed April 19, 2000).
4.2 Form of Senior Debt Securities Indenture.*
4.3 Form of Senior Debt Securities.*
4.4 Form of Subordinated Debt Securities Indenture.*
4.5 Form of Subordinated Debt Securities.*
4.6 Form of Warrant Agreement (including form of Warrant
Certificate).*
4.7 Form of Rights Agreement (including form of Right Certificate).*
4.8 Form of Purchase Contract (including form of Purchase Contract
Certificate) and, if applicable, Pledge Agreement.*
4.9 Form of Unit Agreement (including form of Unit Certificate).*
4.10 Form of Common Stock Certificate.*
4.11 Certificate of Designation of Preferred Stock.*
4.12 Form of Preferred Stock Certificate.*
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5.1 Opinion of Bryan Cave LLP as to the legality of securities being
registered.**
10.1 Confidential License Agreement for Nintendo Gamecube (Western
Hemisphere), dated as of November 9, 2001, between Nintendo of
America Inc. and Activision Publishing, Inc.***
10.2 License Agreement for the Nintendo Gamecube System (EEA), dated
as of June 5, 2002, between Nintendo Co., Ltd. and Activision,
Inc.***
10.3 Confidential License Agreement for Game Boy Advance (Western
Hemisphere), dated as of May 10, 2001, between Nintendo of
America, Inc. and Activision Publishing, Inc.***
10.4 Confidential License Agreement for the Game Boy Advance Video
Game System (EEA, Austrailia and New Zealand), dated as of
September 14, 2001, between Nintendo Co., Ltd. and Activision,
Inc.***
10.5 Microsoft Corporation Xbox Publisher License Agreement, dated as
of July 18, 2001, between Microsoft Corporation and Activision
Publishing, Inc.***
10.6 Amendment to Microsoft Corporation Xbox Publisher License
Agreement, dated as of April 19, 2002, between Microsoft
Corporation and Activision Publishing, Inc.***
10.7 Xbox Live Distribution Amendment to the Xbox Publisher Licensing
Agreement, dated as of October 28, 2002, between Microsoft
Corporation and Activision Publishing, Inc.***
10.8 Licensed Publisher Agreement, dated as of July 13, 2002, between
Sony Computer Entertainment America Inc. and Activision, Inc.***
10.9 Amendment to Licensed Publisher Agreement, dated as of April 1,
2000, between Sony Computer Entertainment America Inc. and
Activision, Inc.***
10.10 Playstation2 Licensed Publisher Agreement, dated as of March 23,
2001, between Sony Computer Entertainment Europe Limited and
Activision UK Limited.***
12.1 Computation of Ratio of Earnings to Fixed Charges.**
23.1 Consent of Bryan Cave LLP (included as part of Exhibit 5.1).**
23.2 Consent of KPMG LLP.
23.3 Consent of PricewaterhouseCoopers LLP.
24.1 Power of attorney (included on signature page).**
25.1 Statement of Eligibility of Trustee on Form T-1.*
________________________
* To be filed, if necessary, subsequent to the effectiveness of this
registration statement by an amendmentSchedules.
The Exhibits to this registration statement or
incorporated by reference pursuant to a Current Report on Form 8-Kare listed in connection with the offering of securities registered hereunder.
** Previously filed.
*** Previously filed with registration statement on Form S-3 (333-101271).
II-3Exhibit Index following the signature pages hereto.
Item 22. UndertakingsUndertakings.
The undersigned registrant hereby undertakes:
1.
(1) To file, during any period in which offers or sales are being made, a post effectivepost-effective amendment to this registration statement:
- (i)
- To include any prospectus required by section 10(a)(3) of the Securities Act of
1933, as amended (the "Securities Act");
1933;
- (ii)
- To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post effectivepost-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission (the "Commission") pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;
- (iii)
- To include any material information with respect to the plan of distribution not previously disclosed in the registration
statement;
provided, however, that clauses (1)(i) and (1)(ii) do not apply if the
additionalstatement or any material change to such information required to be included in a post effective
amendment by such clauses is contained in periodic reports filed with
or furnished to the Commission by the registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), that are incorporated by reference in the registration statement.
2.
(2) That, for purposesthe purpose of determining any liability under the Securities Act of 1933, each such post effectivepost-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. (1) As follows: that prior to any public reoffering of the
securities registered hereunder through use of a prospectus which
is a part of this registration statement, by any person or party
who is deemed to be an underwriter within the meaning of Rule
145(c), the registrant undertakes that such reoffering prospectus
will contain the information called for by the applicable
registration form with respect to reofferings by persons who may
be deemed underwriters, in addition to the information called for
by the other items of the applicable form.
(2) That every prospectus: (i) that is filed pursuant to
paragraph (1) immediately preceding, or (ii) that purports to
meet the requirements of Section 10(a)
(3) of the Act and is used
in connection with an offering of securities subject to Rule 415,
will be filed as part of an amendment to the registration
statement and will not be used until such amendment is effective,
and that, for purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
II-4
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
4. To remove from registration by means of a post effectivepost-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
5.
(4) That, for purposes of determining any liability under the Securities Act the information omitted from the form of prospectus filed as part of this registration statement in
reliance upon Rule 430A and contained in a form of prospectus
filed by the registrant pursuant to Rule 424(b)1 or (4) or 497(h)
under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
6. That, for the purpose of determining any liability under the
Securities Act, each post- effective amendment that contains a
form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
7. To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Item 4, 10(b), 11 or 13
of this form, within one business day of receipt of such request,
and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained
in documents filed subsequent to the effective date of the
registration statement through the date of responding to the
request.
8. To supply by means of a post-effective amendment all required
information concerning a transaction, and the company being
acquired involved therein, that was not the subject of and
included in the registration statement when it became effective;
provided, however, that where the transaction in which the
securities are being offered pursuant to the registration
statement under the Securities Act would itself qualify for an
exemption from Section 5 of the Act, absent the existence of
other similar (prior or subsequent) transactions, a prospectus
supplement could be used to furnish the information necessary in
connection with such transaction.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act,1933, each filing of the registrant's annual reportreports pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act)Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is
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asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
II-5
The undersigned
(6) That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant hereby undertakespursuant to file an applicationRule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
(7) That, for the purpose of determining any liability under the eligibilitySecurities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(8) To respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the trusteeregistration statement through the date of responding to act under subsection
(a)the request.
(9) To supply by means of Section 310post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2)registration statement when it became effective.
II-3
Table of the Act.
II-6
Contents
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Amendment No. 2 to the Registration Statement on
Form S-4registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the cityCity of Los Angeles,Santa Monica, State of California, on February 19,
2003.
ACTIVISION, INC.
/s/ Ronald Doornink
By:---------------------------
Ronald Doornink, PresidentMarch 17, 2017.
| | | | |
| | ACTIVISION BLIZZARD, INC. |
|
|
By: |
|
/s/ DENNIS DURKIN
Name: Dennis Durkin
Title:Chief Financial Officer |
POWERS OF ATTORNEY
We, the undersigned officers and directors of Activision Blizzard, Inc. hereby severally constitute and appoint Robert A. Kotick, Dennis Durkin, Thomas Tippl, Christopher B. Walther and Jeffrey A. Brown, and each of them singly, our true and lawful attorneys with full power to any of them, and to each of them singly, to sign for us and in our names in the capacities indicated below the Registration Statement on Form S-4 filed herewith and any and all amendments (including post-effective amendments) to said Registration Statement under the Securities Act of 1933, as amended, in connection with said Registration Statement, and to file or cause to be filed the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, and generally to do all such things in our name and on our behalf in our capacities as officers and directors to enable Activision Blizzard, Inc. to comply with the provisions of the Securities Act of 1933, as amended, and all requirements of the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys, and each of them, or their substitute or substitutes, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this Amendment No. 2 to the Registration Statementregistration statement has been signed by the following persons in the capacities and on the dates indicated.
Name Title Date
- --- ----- ----
* Chairman, Chief Executive February 19, 2003
- ------------------------ Officer and Director
(Robert A. Kotick)
* Co-Chairman and Director February 19, 2003
- ------------------------
(Brian G. Kelly)
/s/ Ronald Doornink
- ------------------------ President, Activision, Inc.; February 19, 2003
(Ronald Doornink) Chief Executive Officer,
Activision Publishing, Inc.
(PrincipalExecutive Officer)
* Executive Vice President and February 19, 2003
- ------------------------ Chief Financial Officer
(William J. Chardavoyne) (Principal Financial
and Accounting Officer)
*
- ------------------------ Director February 19, 2003
(Kenneth L. Henderson)
* Director February 19, 2003
- -----------------------
(Barbara S. Isgur)
* Director February 19, 2003
- -----------------------
(Steven T. Mayer)
* Director February 19, 2003
- ------------------------
(Robert J. Morgado)
*By: /s/ Ronald Doornink
- ------------------------
Ronald Doornink
(Attorney-in-fact)
II-7
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Signature | | Title | | Date |
|---|
|
|
|
|
|
/s/ ROBERT A. KOTICK
Robert A. Kotick | | Director, President and Chief Executive Officer, and Principal Executive Officer | | March 17, 2017 |
/s/ DENNIS DURKIN
Dennis Durkin |
|
Chief Financial Officer and Principal Financial Officer |
|
March 17, 2017 |
/s/ STEPHEN WEREB
Stephen Wereb |
|
Chief Accounting Officer and Principal Accounting Officer |
|
March 17, 2017 |
/s/ ROBERT J. CORTI
Robert J. Corti |
|
Director |
|
March 17, 2017 |
Table of Contents
| | | | |
Signature | | Title | | Date |
|---|
|
|
|
|
|
/s/ BRIAN G. KELLY
Brian G. Kelly | | Chairman and Director | | March 17, 2017 |
/s/ HENDRIK J. HARTONG III
Hendrik J. Hartong III |
|
Director |
|
March 17, 2017 |
/s/ BARRY MEYER
Barry Meyer |
|
Director |
|
March 17, 2017 |
/s/ ROBERT J. MORGADO
Robert J. Morgado |
|
Director |
|
March 17, 2017 |
/s/ PETER NOLAN
Peter Nolan |
|
Director |
|
March 17, 2017 |
/s/ CASEY WASSERMAN
Casey Wasserman |
|
Director |
|
March 17, 2017 |
/s/ ELAINE P. WYNN
Elaine P. Wynn |
|
Director |
|
March 17, 2017 |
Table of Contents
EXHIBIT INDEX
Page Number
| | | |
Exhibit
No. | | Description |
|---|
| | 2.1 | | Transaction Agreement, dated November 2, 2015, by and among King Digital Entertainment plc, ABS Partners C.V. and Activision Blizzard, Inc. (incorporated by reference to Exhibit 2.1 of the Company's Form 8-K, filed November 3, 2015). |
| | | | |
| | 2.2 | | Appendix I to the Rule 2.5 Announcement (Conditions Appendix) (incorporated by reference to Exhibit 2.2 of the Company's Form 8-K, filed November 3, 2015). |
| | | | |
| | 3.1 | | Third Amended and Restated Certificate of Incorporation of Activision Blizzard, Inc., dated June 5, 2014 (incorporated by reference to Exhibit 3.1 of the Company's Form 8-K, filed June 6, 2014). |
| | | | |
| | 3.2 | | Third Amended and Restated Bylaws of Activision Blizzard, Inc., adopted as of February 2, 2016 (incorporated by reference to Exhibit 3.1 of the Company's Form 8-K, filed February 8, 2016). |
| | | | |
| | 4.1 | | Indenture, dated as of September 19, 2013, among Activision Blizzard, Inc., the guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Company's Form 8-K, filed September 19, 2013). |
| | | | |
| | 4.2 | | Indenture, dated as of September 19, 2016, among Activision Blizzard, Inc., the guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Company's Form 8-K, filed September 19, 2016). |
| | | | |
| | 5.1 | (1) | Opinion of Skadden, Arps, Slate, Meagher & Flom LLP. |
| | | | |
| | 10.1 | * | Activision, Inc. 1999 Incentive Plan, as amended (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended June 30, 2002). |
| | | | |
| | 10.2 | * | Amendment, dated as of September 14, 2006, to the 1999 Incentive Plan (incorporated by reference to Exhibit 10.3 of the Company's Form 8-K filed September 20, 2006). |
| | | | |
| | 10.3 | * | Activision, Inc. 2001 Incentive Plan, as amended (incorporated by reference to Exhibit 10.2 of the Company's Form 10-Q for the quarter ended June 30, 2002). |
| | | | |
| | 10.4 | * | Amendment, dated as of September 14, 2006, to the 2001 Incentive Plan (incorporated by reference to Exhibit 10.4 of the Company's Form 8-K filed September 20, 2006). |
| | | | |
| | 10.5 | * | Activision, Inc. 2002 Incentive Plan, as amended (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended June 30, 2003). |
| | | | |
| | 10.6 | * | Amendment, dated as of September 14, 2006, to the 2002 Incentive Plan (incorporated by reference to Exhibit 10.5 of the Company's Form 8-K filed September 20, 2006). |
| | | | |
| | 10.7 | * | Activision, Inc. 2002 Studio Employee Retention Incentive Plan (incorporated by reference to Exhibit 4.1 of the Company's Form S-8, Registration No. 333-103323 filed February 19, 2003). |
| | | | |
| | 10.8 | * | Amendment, dated as of September 14, 2006, to the 2002 Studio Employee Retention Incentive Plan (incorporated by reference to Exhibit 10.7 of the Company's Form 8-K filed September 20, 2006). |
| | | | |
| | 10.9 | * | Activision, Inc. Amended and Restated 2003 Incentive Plan (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended June 30, 2005). |
| | | | |
| | 10.10 | * | Amendment, dated as of September 14, 2006, to the 2003 Incentive Plan (incorporated by reference to Exhibit 10.9 of the Company's Form 8-K filed September 20, 2006). |
| |
| | |
Table of Contents
| | | |
Exhibit
No. | | Description |
|---|
| 10.11 | * | Activision, Inc. 2007 Incentive Plan (incorporated by reference to Exhibit 99.1 of the Company's Registration Statement on Form S-8, Registration No. 333-146431, filed October 1, 2007). |
| | | |
| 10.12 | * | Activision Blizzard, Inc. Amended and Restated 2008 Incentive Plan, as amended and restated (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K filed June 12, 2012). |
| | | |
| 10.13 | * | Activision Blizzard, Inc. 2014 Incentive Plan (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K filed June 6, 2014). |
| | | |
| 10.14 | * | Activision Blizzard, Inc. KDE Equity Incentive Plan, amended as of November 1, 2016 (incorporated by reference to Exhibit 10.14 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.15 | * | Form of Stock Option Certificate for grants to persons other than non-employee directors pursuant to the Activision, Inc. 1999 Incentive Plan (incorporated by reference to Exhibit 10.2 of the Company's Form 8-K, filed May 31, 2005). |
| | | |
| 10.16 | * | Form of Stock Option Agreement for grants to persons other than non-employee directors pursuant to the Activision, Inc. 2001 Incentive Plan (incorporated by reference to Exhibit 10.3 of the Company's Form 8-K, filed May 31, 2005). |
| | | |
| 10.17 | * | Form of Non-Executive Stock Option Agreement for grants to persons other than Robert A. Kotick or Brian G. Kelly and non-employee directors pursuant to the Activision, Inc. 2003 Incentive Plan (effective as of July 26, 2005) (incorporated by reference to Exhibit 10.41 of the Company's Form 10-K for the year ended March 31, 2005). |
| | | |
| 10.18 | * | Form of Notice of Share Option Award for grants to persons other than non-employee directors pursuant to the Activision, Inc. 2003 Incentive Plan (effective as of June 13, 2007) (incorporated by reference to Exhibit 10.18 of the Company's Form 10-K for the year ended March 31, 2007). |
| | | |
| 10.19 | * | Form of Notice of Restricted Share Unit Award for grants to persons other than non-employee directors pursuant to the Activision, Inc. 2003 Incentive Plan (incorporated by reference to Exhibit 10.21 of the Company's Form 10-K for the year ended March 31, 2007). |
| | | |
| 10.20 | * | Form of Notice of Restricted Share Award for grants to persons other than non-employee directors pursuant to the Activision, Inc. 2003 Incentive Plan (incorporated by reference to Exhibit 10.20 of the Company's Form 10-K for the year ended March 31, 2007). |
| | | |
| 10.21 | * | Form of Notice of Stock Option Award for grants to non-employee directors pursuant to the Activision, Inc. 2007 Incentive Plan (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
| | | |
| 10.22 | * | Form of Notice of Stock Option Award for grants to persons other than non-employee directors pursuant to the Activision, Inc. 2007 Incentive Plan (incorporated by reference to Exhibit 10.2 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
| | | |
| 10.23 | * | Form of Notice of Restricted Share Unit Award for grants to officers pursuant to the Activision, Inc. 2007 Incentive Plan (incorporated by reference to Exhibit 10.4 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
| | | |
| 10.24 | * | Form of Notice of Restricted Share Unit Award for grants to persons other than officers or directors pursuant to the Activision, Inc. 2007 Incentive Plan (incorporated by reference to Exhibit 10.8 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
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Table of Contents
| | | |
Exhibit
No. | | Description |
|---|
| 10.25 | * | Form of Notice of Restricted Share Award for grants to persons other than non-employee directors pursuant to the Activision, Inc. 2007 Incentive Plan (incorporated by reference to Exhibit 10.3 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
| | | |
| 10.26 | * | Form of Notice of Stock Option Award for grants to unaffiliated directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of November 12, 2008) (incorporated by reference to Exhibit 10.44 of the Company's Form 10-K for the year ended December 31, 2008). |
| | | |
| 10.27 | * | Form of Notice of Stock Option Award for grants to persons other than directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of November 12, 2008) (incorporated by reference to Exhibit 10.45 of the Company's Form 10-K for the year ended December 31, 2008). |
| | | |
| 10.28 | * | Form of Notice of Restricted Share Unit Award for grants to persons other than directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of November 12, 2008) (incorporated by reference to Exhibit 10.49 of the Company's Form 10-K for the year ended December 31, 2008). |
| | | |
| 10.29 | * | Form of Notice of Restricted Share Award for grants to persons other than directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of November 12, 2008) (incorporated by reference to Exhibit 10.50 of the Company's Form 10-K for the year ended December 31, 2008). |
| | | |
| 10.30 | * | Form of Notice of Restricted Share Unit Award for grants under the Company's 2008 Incentive Plan (effective as of November 12, 2008) (incorporated by reference to Exhibit 10.12 of the Company's Form 10-Q for the quarter ended March 31, 2012). |
| | | |
| 10.31 | * | Form of Notice of Performance Share Award for grants under the Company's 2008 Incentive Plan (incorporated by reference to Exhibit 10.13 of the Company's Form 10-Q for the quarter ended March 31, 2012). |
| | | |
| 10.32 | * | Form of Notice of Stock Option Award for grants to unaffiliated directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of March 6, 2013) (incorporated by reference to Exhibit 10.5 of the Company's Form 10-Q for the quarter ended March 31, 2013). |
| | | |
| 10.33 | * | Form of Notice of Stock Option Award for grants to persons other than directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of March 6, 2013) (incorporated by reference to Exhibit 10.6 of the Company's Form10-Q for the quarter ended March 31, 2013). |
| | | |
| 10.34 | * | Form of Notice of Restricted Share Unit Award for grants to affiliated non-employee directors and to unaffiliated directors upon their re-election to the board (other than in connection with 10 years of continuous service) pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of November 12, 2008) (incorporated by reference to Exhibit 10.8 of the Company's Form 10-Q for the quarter ended March 31, 2013). |
| | | |
| 10.35 | * | Form of Notice of Restricted Share Unit Award for grants to persons other than directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of March 6, 2013) (incorporated by reference to Exhibit 10.9 of the Company's Form 10-Q for the quarter ended March 31, 2013). |
| | | |
| 10.36 | * | Form of Notice of Restricted Share Award for grants to persons other than directors pursuant to the Activision Blizzard, Inc. 2008 Incentive Plan (effective as of March 6, 2013) (incorporated by reference to Exhibit 10.10 of the Company's Form 10-Q for the quarter ended March 31, 2013). |
|
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| | | |
Exhibit
No. | | Description |
|---|
| 10.37 | * | Form of Notice of Stock Option Award for grants pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of June 5, 2013) (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended June 30, 2014). |
| | | |
| 10.38 | * | Form of Notice of Restricted Share Unit Award for grants to persons other than non-affiliated directors pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of June 5, 2014) (incorporated by reference to Exhibit 10.2 of the Company's Form 10-Q for the quarter ended June 30, 2014). |
| | | |
| 10.39 | * | Form of Notice of Performance-Vesting Restricted Share Unit Award for grants pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of June 5, 2014) (incorporated by reference to Exhibit 10.4 of the Company's Form 10-Q for the quarter ended June 30, 2014). |
| | | |
| 10.40 | * | Form of Notice of Restricted Share Award for grants pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of June 5, 2014) (incorporated by reference to Exhibit 10.5 of the Company's Form 10-Q for the quarter ended June 30, 2014). |
| | | |
| 10.41 | * | Form of Notice of Restricted Share Unit Award for grants to persons other than non-affiliated directors pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of July 29, 2014) (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended September 30, 2014). |
| | | |
| 10.42 | * | Form of Notice of Restricted Share Unit Award for grants to non-affiliated directors pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of July 29, 2014) (incorporated by reference to Exhibit 10.2 of the Company's Form 10-Q for the quarter ended September 30, 2014). |
| | | |
| 10.43 | * | Form of Notice of Performance-Vesting Restricted Share Unit Award for grants pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of July 29, 2014) (incorporated by reference to Exhibit 10.3 of the Company's Form 10-Q for the quarter ended September 30, 2014). |
| | | |
| 10.44 | * | Form of Notice of Stock Option Award for grants to U.S. employees pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of November 1, 2016) (incorporated by reference to Exhibit 10.44 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.45 | * | Form of Notice of Stock Option Award for grants to non-U.S. employees pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of November 1, 2016) (incorporated by reference to Exhibit 10.45 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.46 | * | Form of Notice of Performance-Vesting Restricted Share Unit Award for grants to non-U.S. employees pursuant to the Activision Blizzard, Inc. 2014 Incentive Plan (effective as of November 1, 2016) (incorporated by reference to Exhibit 10.46 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.47 | * | Amended and Restated CEO Recognition Program (incorporated by reference to Exhibit 10.6 of the Company's Form 10-Q for the quarter ended June 30, 2014). |
| | | |
| 10.48 | * | Activision Blizzard, Inc. Corporate Annual Incentive Plan (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended September 30, 2015). |
| | | |
| 10.49 | * | Employment Agreement, dated September 9, 2005, between Thomas Tippl and Activision Publishing, Inc. (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended September 30, 2005). |
|
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Exhibit
No. | | Description |
|---|
| 10.50 | * | Amendment, dated as of December 15, 2008, to Employment Agreement between Thomas Tippl and Activision Publishing, Inc. (incorporated by reference to Exhibit 10.59 of the Company's Form 10-K for the year ended December 31, 2008). |
| | | |
| 10.51 | * | Amendment, dated as of April 15, 2009, to Employment Agreement between Thomas Tippl and Activision Publishing, Inc. (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended June 30, 2009). |
| | | |
| 10.52 | * | Amendment, dated as of March 23, 2010, to Employment Agreement between Thomas Tippl and Activision Blizzard, Inc. (incorporated by reference to Exhibit 10.5 of the Company's Form 10-Q for the quarter ended March 31, 2010). |
| | | |
| 10.53 | * | Amendment, dated as of December 5, 2013, to Employment Agreement between Thomas Tippl and Activision Blizzard, Inc. (incorporated by reference to Exhibit 10.57 of the Company's Form 10-K for the year ended December 31, 2013). |
| | | |
| 10.54 | * | Notice of Restricted Share Unit Award, dated as of February 10, 2014, to Thomas Tippl (incorporated by reference to Exhibit 10.68 of the Company's Form 10-K for the year ended December 31, 2013). |
| | | |
| 10.55 | * | Employment Agreement, dated June 30, 2012, between Brian G. Kelly and the Company (incorporated by reference to Exhibit 10.2 of the Company's Form 10-Q for the quarter ended June 30, 2012). |
| | | |
| 10.56 | * | Transition Agreement, dated November 22, 2016, between the Company and Brian G. Kelly (incorporated by reference to Exhibit 10.56 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.57 | * | Notice of Stock Option Award, dated as of August 6, 2015 to Brian G. Kelly (incorporated by reference to Exhibit 10.2 of the Company's Form 10-Q for the quarter ended September 30, 2015). |
| | | |
| 10.58 | * | Employment Agreement, dated as of December 1, 2007, between Michael Morhaime and Vivendi Games, Inc. (incorporated by reference to Exhibit 10.19 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
| | | |
| 10.59 | * | Assignment and Assumption of Morhaime Employment Agreement, dated as of July 9, 2008, between Vivendi Games. Inc. and the Company (incorporated by reference to Exhibit 10.20 of the Company's Form 10-Q for the quarter ended September 30, 2008). |
| | | |
| 10.60 | * | Amendment, dated as of December 15, 2008, to Employment Agreement between Michael Morhaime and the Company (incorporated by reference to Exhibit 10.94 of the Company's Form 10-K for the year ended December 31, 2008). |
| | | |
| 10.61 | * | Amendment, dated as of March 31, 2009, to Employment Agreement between Michael Morhaime and the Company (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended March 31, 2009). |
| | | |
| 10.62 | * | Amendment, dated as of November 4, 2009, to Employment Agreement between Michael Morhaime and the Company (incorporated by reference to Exhibit 10.92 of the Company's Form 10-K for the year ended December 31, 2009). |
| | | |
| 10.63 | * | Amendment, dated as of October 26, 2010, to Employment Agreement between Michael Morhaime and the Company (incorporated by reference to Exhibit 10.86 of the Company's Form 10-K for the year ended December 31, 2010). |
| | | |
| 10.64 | * | Notice of Stock Option Award, dated as of November 14 2014, to Michael Morhaime (incorporated by reference to Exhibit 10.66 of the Company's Form 10-K for the year ended December 31, 2014). |
|
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| | | |
Exhibit
No. | | Description |
|---|
| 10.65 | * | Notice of Restricted Share Unit Award, dated as of November 14 2014, to Michael Morhaime (incorporated by reference to Exhibit 10.67 of the Company's Form 10-K for the year ended December 31, 2014). |
| | | |
| 10.66 | * | Notice of Stock Option Award, dated as of November 13, 2015, to Michael Morhaime (incorporated by reference to Exhibit 10.85 of the Company's Form 10-K for the year ended December 31, 2015). |
| | | |
| 10.67 | * | Notice of Restricted Share Unit Award, dated as of November 13, 2015, to Michael Morhaime (incorporated by reference to Exhibit 10.86 of the Company's Form 10-K for the year ended December 31, 2015). |
| | | |
| 10.68 | * | Notice of Stock Option Award, dated as of November 7, 2016, to Michael Morhaime (incorporated by reference to Exhibit 10.68 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.69 | * | Notice of Restricted Share Unit Award, dated as of November 07, 2016, to Michael Morhaime (incorporated by reference to Exhibit 10.69 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | |
| 10.70 | * | Employment Agreement, dated as of July 6, 2010, between Eric Hirshberg and Activision Publishing, Inc. (incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q for the quarter ended March 31, 2011). |
| | | |
| 10.71 | * | Amendment, dated as of October 15, 2015, to Employment Agreement between Eric Hirshberg and Activision Publishing, Inc. (incorporated by reference to Exhibit 10.3 of the Company's Form 10-Q for the quarter ended March 31, 2016). |
| | | |
| 10.72 | * | Notice of Assignment of Hirshberg Employment Agreement to Activision Blizzard, Inc. dated December 22, 2011 (incorporated by reference to Exhibit 10.97 of the Company's Form 10-K for the year ended December 31, 2011). |
| | | |
| 10.73 | * | Notice of Stock Option Award, dated as of November 13, 2015, to Eric Hirshberg (incorporated by reference to Exhibit 10.4 of the Company's Form 10-Q for the quarter ended March 31, 2016). |
| | | |
| 10.74 | * | Employment Agreement, dated February 29, 2012, between Dennis Durkin and the Company (incorporated by reference to Exhibit 10.5 of the Company's Form 10-Q for the quarter ended March 31, 2012). |
| | | |
| 10.75 | * | Notice of Stock Option Award, dated as of March 6, 2012, to Dennis Durkin (incorporated by reference to Exhibit 10.6 of the Company's Form 10-Q for the quarter ended March 31, 2012). |
| | | |
| 10.76 | * | Notice of Restricted Share Unit Award, dated as of March 6, 2012, to Dennis Durkin (incorporated by reference to Exhibit 10.8 of the Company's Form 10-Q for the quarter ended March 31, 2012). |
| | | |
| 10.77 | * | Employment Agreement, dated November 22, 2016, between Robert A. Kotick and the Company (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed November 25, 2016). |
| | | |
| 10.78 | * | Notice of Performance Share Unit Award, dated November 22, 2016, to Robert A. Kotick (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed November 25, 2016). |
| | | |
| 10.79 | | Tax Sharing Agreement, dated as of July 9, 2008, among the Company, Vivendi Holding I Corp., Vivendi Games, Inc. (incorporated by reference to Exhibit 10.2 of the Company's Form 8-K, filed July 15, 2008). |
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| | | |
Exhibit
No. | | Description |
|---|
| 10.80 | | ASAC Stockholders Agreement, dated as of October 11, 2013, among the Company, ASAC and, for the limited purposes set forth in the ASAC Stockholders Agreement, Mr. Kotick and Mr. Kelly (incorporated by reference to Exhibit 10.4 of the Company's Form 8-K, filed October 18, 2013). |
| | | |
| 10.81 | | Amendment, dated May 28, 2015, to the ASAC Stockholders Agreement among the Company, ASAC and, for the limited purposes set forth therein, Mr. Kotick and Mr. Kelly (incorporated by reference to Exhibit 10.2 of the Company's Form 8-K filed June 2, 2015). |
| | | |
| 10.82 | | Credit Agreement, dated as of October 11, 2013, among the Company, as borrower, certain subsidiaries of the Company, as guarantors, a group of lenders, Bank of America, N.A., as administrative agent and collateral agent for the lenders, J.P. Morgan Securities LLC, as syndication agent, Bank of America Merrill Lynch and J.P. Morgan Securities LLC, as joint lead arrangers and joint bookrunners, and Goldman Sachs & Co., HSBC Securities (USA) Inc., Mistubishi UFJ Securities (USA), Inc., Mizuho Securities USA Inc., RBC Capital Markets, SunTrust Bank and U.S. Bank National Association, as co-documentation agents (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed October 18, 2013). |
| | | |
| 10.83 | | First Amendment to the Credit Agreement, dated as of October 11, 2013, by and among Activision Blizzard, Inc., the guarantors from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the several other agents party thereto (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed November 3, 2015). |
| | | |
| 10.84 | | Second Amendment to the Credit Agreement, dated as of October 11, 2013, by and among Activision Blizzard, Inc., the guarantors from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the several other agents party thereto (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed November 17, 2015). |
| | | |
| 10.85 | | Third Amendment to the Credit Agreement, dated as of October 11, 2013, by and among Activision Blizzard, Inc., the guarantors from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the several other agents party thereto (incorporated by reference to Exhibit 10.1 of the Company's form 8-K, filed December 14, 2015). |
| | | |
| 10.86 | | Fourth Amendment to the Credit Agreement, dated as of October 11, 2013, by and among Activision Blizzard, Inc., the guarantors from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the several other agents party thereto (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed April 1, 2016). |
| | | |
| 10.87 | | Fifth Amendment to the Credit Agreement, dated as of October 11, 2013, by and among Activision Blizzard, Inc., the guarantors from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the several other agents party thereto (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed August 24, 2016). |
| | | |
| 10.88 | | Sixth Amendment to the Credit Agreement, dated as of October 11, 2013, by and among Activision Blizzard, Inc., the guarantors from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the several other agents party thereto (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed February 6, 2017). |
|
| | |
Table of Contents
| | | |
Exhibit
No. | | Description |
|---|
| | 10.89 | | Registration Rights Agreement, dated as of September 19, 2016, among Activision Blizzard, Inc., the guarantors named therein and the representatives of the initial purchasers of the Notes (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed September 19, 2016). |
| | | | |
| | 10.90 | * | Non-Affiliated Director Compensation Program and Stock Ownership Guidelines, as amended and restated as of November 22, 2016 (incorporated by reference to Exhibit 10.90 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | | |
| | 10.91 | | Stipulation of Compromise and Settlement, dated as of December 19, 2014 (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K, filed December 29, 2014). |
| | | | |
| | 11.1 | | Statement Re: Computation of Per Share Earnings (incorporated by reference to Note 16 of the Notes to Consolidated Financial Statements of the Company's Form 10-K for the year ended December 31, 2016). |
| | | | |
| | 12.1 | (1) | Statement Re: Computation of Ratio of Earnings to Fixed Charges. |
| | | | |
| | 21.1 | | Subsidiaries of the Company (incorporated by reference to Exhibit 21.1 of the Company's Form 10-K for the year ended December 31, 2016). |
| | | | |
| | 23.1 | (1) | Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm for Activision Blizzard, Inc. |
| | | | |
| | 23.2 | | Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5). |
| | | | |
| | 24.1 | | Powers of Attorney (included on Signature Page). |
| | | | |
| | 25.1 | (1) | Form T-1 statement of eligibility under the Trust Indenture Act of 1939 of Trustee. |
| | | | |
| | 99.1 | (1) | Form of Letter of Transmittal. |
- *
- Indicates a management contract or compensatory plan, contract or arrangement in
Signed
Exhibit No. Description Registration Statement
- ---------- ----------- -----------------------
3.1 Our Amended and Restated Certificatewhich a director or executive officer of Incorporation, dated June 1,
2000 (incorporated by reference to Exhibit 2.5 of our Current Report
on Form 8-K, filed on June 16, 2000).
3.2 Our Certificate of Amendment of Amended and Restated Certificate of
Incorporation, dated June 9, 2000 (incorporated by reference to
Exhibit 2.7 of our Current Report on Form 8-K, filed on June 16,
2000).
3.3 Our Certificate of Amendment of Amended and Restated Certificate of
Incorporation, dated August 23, 2001 (incorporated by reference to
Exhibit 3.3 of Amendment No. 1 to our Registration Statement on Form
S-3, Registration No. 333-66280, filed on August 31, 2001).
3.4 Our Certificate of Designation of Series A Junior Preferred Stock,
dated December 27, 2001 (incorporated by reference to Exhibit 3.4 of
our Quarterly Report on Form 10-Q for the quarterly period ended
December 31, 2001).
3.5 Our Amended and Restated By-laws dated August 1, 2000 (incorporated by
reference to Exhibit 3.2 of our Current Report on form 8-K, filed July
11, 2001).
4.1 Rights Agreement dated as of April 18, 2000, between us and
Continental Stock Transfer & Trust Company which includes as exhibits
the form of Right Certificates as Exhibit A, the Summary of Rights to
Purchase Series A Junior Preferred Stock as Exhibit B and the form of
Certificate of Designation of Series A Junior Preferred Stock of
Activision as Exhibit C, (incorporated by reference to our
Registration Statement on Form 8-A, Registration No. 001-15839, filed
April 19, 2000).
4.2 Form of Senior Debt Securities Indenture.*
4.3 Form of Senior Debt Securities.*
4.4 Form of Subordinated Debt Securities Indenture.*
4.5 Form of Subordinated Debt Securities.*
4.6 Form of Warrant Agreement (including form of Warrant Certificate).*
4.7 Form of Rights Agreement (including form of Right Certificate).*
4.8 Form of Purchase Contract (including form of Purchase Contract
Certificate) and, if applicable, Pledge Agreement.*
4.9 Form of Unit Agreement (including form of Unit Certificate).*
4.10 Form of Common Stock Certificate.*
4.11 Certificate of Designation of Preferred Stock.*
4.12 Form of Preferred Stock Certificate.*
5.1 Opinion of Bryan Cave LLP as to the legality of securities being
registered.**
II-8
10.1 Confidential License Agreement for Nintendo Gamecube (Western
Hemisphere), dated as of November 9, 2001, between Nintendo of America
Inc. and Activision Publishing, Inc.***
10.2 License Agreement for the Nintendo Gamecube System (EEA), dated as of
June 5, 2002, between Nintendo Co., Ltd. and Activision, Inc.***
10.3 Confidential License Agreement for Game Boy Advance (Western
Hemisphere), dated as of May 10, 2001, between Nintendo of America,
Inc. and Activision Publishing, Inc.***
10.4 Confidential License Agreement for the Game Boy Advance Video Game
System (EEA, Austrailia and New Zealand), dated as of September 14,
2001, between Nintendo Co., Ltd. and Activision, Inc.***
10.5 Microsoft Corporation Xbox Publisher License Agreement, dated as of
July 18, 2001, between Microsoft Corporation and Activision
Publishing, Inc.***
10.6 Amendment to Microsoft Corporation Xbox Publisher License Agreement,
dated as of April 19, 2002, between Microsoft Corporation and
Activision Publishing, Inc.***
10.7 Xbox Live Distribution Amendment to the Xbox Publisher Licensing
Agreement, dated as of October 28, 2002, between Microsoft Corporation
and Activision Publishing, Inc.***
10.8 Licensed Publisher Agreement, dated as of July 13, 2002, between Sony
Computer Entertainment America Inc. and Activision, Inc. ("Playstation
license").***
10.9 Amendment to Licensed Publisher Agreement, dated as of April 1, 2000,
between Sony Computer Entertainment America Inc. and Activision, Inc.
("Playstation2 license").***
10.10 Playstation2 Licensed Publisher Agreement, dated as of March 23,
2001, between Sony Computer Entertainment Europe Limited and
Activision UK Limited.***
12.1 Computation of Ratio of Earnings to Fixed Charges.**
23.1 Consent of Bryan Cave LLP (included as part of Exhibit 5.1).**
23.2 Consent of KPMG LLP.
23.3 Consent of PricewaterhouseCoopers LLP.
24.1 Power of attorney (included on signature page).**
25.1 Statement of Eligibility of Trustee on Form T-1.*
________________________
* To be filed, if necessary, subsequent to the effectiveness of this
registration statement by an amendment to this registration statement or
incorporated by reference pursuant to a Current Report on Form 8-K in connection
with the offering of securities registered hereunder.
** Previously filed.
*** Previously filed with registration statement on Form S-3 (333-101271).
II-9
participates.
- (1)
- Filed herewith.