UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13E-3
RULE 13e-3 TRANSACTION STATEMENT
UNDER SECTION 13(e) OF
THE SECURITIES EXCHANGE ACT OF 1934
ENDEAVOR
GROUP HOLDINGS, INC.
(Name of the Issuer)
Endeavor
Group Holdings, Inc.
Endeavor Operating Company, LLC
Endeavor Manager, LLC
Endeavor Executive Holdco, LLC
Endeavor Executive II Holdco, LLC
Endeavor Executive PIU Holdco, LLC
Silver Lake West Holdco, L.P.
Silver Lake West Holdco II, L.P.
Silver Lake West Voteco, L.L.C.
Wildcat EGH Holdco, L.P.
Wildcat OpCo Holdco, L.P.
Wildcat PubCo Merger Sub, Inc.
Wildcat OpCo Merger Sub, L.L.C.
Wildcat Manager Merger Sub, L.L.C.
SLP Wildcat Aggregator GP, L.L.C.
Silver Lake Partners VI, L.P.
Silver Lake Partners VII, L.P.
SL SPV-4, L.P.
Silver Lake Technology Associates VI, L.P.
Silver Lake Technology Associates VII, L.P.
SLTA SPV-4, L.P.
SLTA VI (GP), L.L.C.
SLTA VII (GP), L.L.C.
SLTA SPV-4 (GP), L.L.C.
Silver Lake Group, L.L.C.
Ariel Emanuel
Patrick
Whitesell
(Names of Persons Filing Statement)
Common Stock, par value $0.00001 per share
(Title of Class of Securities)
29260Y109
(CUSIP Number
of Class of Securities)
|
|
|
|
|
Ariel Emanuel
Patrick Whitesell
Endeavor Executive Holdco, LLC
Endeavor Executive II Holdco, LLC
Endeavor Executive PIU Holdco, LLC
c/o Endeavor Group Holdings, Inc.
9601 Wilshire Boulevard, 3rd Floor
Beverly Hills, CA 90210
(310) 285-9000 |
|
Endeavor Group Holdings, Inc.
Endeavor Operating Company, LLC
Endeavor Manager, LLC
9601 Wilshire Boulevard, 3rd Floor
Beverly Hills, CA 90210
(310) 285-9000 |
|
Silver Lake West Holdco, L.P.
Silver Lake West Holdco II, L.P.
Silver Lake West Voteco, L.L.C.
Wildcat EGH Holdco, L.P.
Wildcat OpCo Holdco, L.P.
Wildcat PubCo Merger Sub, Inc.
Wildcat OpCo Merger Sub, L.L.C.
Wildcat Manager Merger Sub, L.L.C.
SLP Wildcat Aggregator GP, L.L.C.
Silver Lake Partners VI, L.P.
Silver Lake Partners VII, L.P.
SL SPV-4, L.P.
Silver Lake Technology Associates VI, L.P.
Silver Lake Technology Associates VII, L.P.
SLTA SPV-4, L.P.
SLTA VI (GP), L.L.C. SLTA
VII (GP), L.L.C. SLTA SPV-4 (GP), L.L.C.
Silver Lake Group, L.L.C.
2775 Sand Hill Road, Suite 100
Menlo Park, CA 94025
(650) 233-8120 |
(Name, Address and Telephone Numbers of Person Authorized to Receive Notices
and Communications on Behalf of the Persons Filing Statement)
With copies to
|
|
|
|
|
Justin G. Hamill
Michael V. Anastasio Ian
Nussbaum Benjamin J. Cohen
Latham & Watkins LLP
1271 Avenue of the Americas
New York, NY 10020 |
|
Faiza J. Saeed
Claudia J. Ricciardi
Cravath, Swaine & Moore LLP
375 Ninth Ave New York,
NY 10001 |
|
Elizabeth Cooper
Christopher May Mark
Myott Simpson Thacher & Bartlett LLP
425 Lexington Avenue New
York, NY 10017 |
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THIS
TRANSACTION, PASSED ON THE MERITS OR THE FAIRNESS OF THE TRANSACTION OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
This statement is filed in connection with (check the appropriate box):
|
|
|
|
|
a. |
|
☒ |
|
The filing of solicitation materials or an information statement subject to Regulation 14A (§§ 240.14a-1 through 240.14b- 2), Regulation 14C (§§ 240.14c-1 through 240.14c-101) or Rule 13e-3(c)
(§ 240.13e-3(c)) under the Securities Exchange Act of 1934 (the Exchange Act). |
|
|
|
b. |
|
☐ |
|
The filing of a registration statement under the Securities Act of 1933. |
|
|
|
c. |
|
☐ |
|
A tender offer. |
|
|
|
d. |
|
☐ |
|
None of the above. |
Check the following box if the soliciting materials or information statement referred to in checking box (a) are
preliminary copies: ☒
Check the following box if the filing is a final amendment reporting the results of the transaction: ☐
INTRODUCTION
This Rule 13e-3 Transaction Statement on Schedule 13E-3,
together with the exhibits hereto (this Transaction Statement), is being filed with the Securities and Exchange Commission (the SEC) pursuant to Section 13(e) of the Exchange Act, by (a) Endeavor Group Holdings,
Inc., a Delaware corporation (the Company or Endeavor), (b) Endeavor Manager, LLC, a Delaware limited liability company and subsidiary of the Company (Manager), (c) Endeavor Operating Company, LLC, a Delaware
limited liability company and a subsidiary of Manager and indirect subsidiary of the Company (OpCo and, together with the Company and Manager, the Company Entities and each, a Company Entity), (d) Endeavor
Executive Holdco, LLC, a Delaware limited liability company (Executive Holdco), (e) Endeavor Executive II Holdco, LLC, a Delaware limited liability company (Executive II Holdco), (f) Endeavor Executive PIU Holdco, LLC, a
Delaware limited liability company (Executive PIU and, together with Executive Holdco and Executive II Holdco, the Executive Holdcos), (g) Silver Lake West HoldCo, L.P., a Delaware limited partnership (West
HoldCo), (h) Silver Lake West HoldCo II, L.P., a Delaware limited partnership (West HoldCo II), (i) Silver Lake West Voteco, L.L.C., a Delaware limited liability company, (j) Wildcat EGH Holdco, L.P., a Delaware limited
partnership (Holdco Parent), (k) Wildcat OpCo Holdco, L.P., a Delaware limited partnership (OpCo Parent and, together with Holdco Parent, the Parent Entities and each, a Parent Entity), (l) Wildcat
PubCo Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Holdco Parent (Company Merger Sub), (m) Wildcat Manager Merger Sub, L.L.C., a Delaware limited liability company and a wholly owned subsidiary of Company
Merger Sub (Manager Merger Sub), (n) Wildcat OpCo Merger Sub, L.L.C., a Delaware limited liability company and wholly owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Manager Merger Sub and Company Merger
Sub, the Merger Subs and each, a Merger Sub), (o) SLP Wildcat Aggregator GP, L.L.C., a Delaware limited liability company, (p) Silver Lake Partners VI, L.P., a Delaware limited partnership, (q) Silver Lake Partners
VII, L.P., a Delaware limited partnership, (r) SL SPV-4, L.P., a Delaware limited partnership, (s) Silver Lake Technology Associates VI, L.P., a Delaware limited partnership, (t) Silver Lake
Technology Associates VII, L.P., a Delaware limited partnership, (u) SLTA SPV-4, L.P., a Delaware limited partnership, (v) SLTA VI (GP), L.L.C., a Delaware limited liability company, (w) SLTA
VII (GP), L.L.C., a Delaware limited liability company, (x) SLTA SPV-4 (GP), L.L.C., a Delaware limited liability company, (y) Silver Lake Group, L.L.C., a Delaware limited liability company,
(z) Ariel Emanuel, a natural person and (aa) Patrick Whitesell, a natural person. Collectively, the persons filing this Transaction Statement are referred to as the filing persons.
This Transaction Statement relates to the Agreement and Plan of Merger, dated April 2, 2024 (the Merger Agreement), by and
among the Company, Manager, OpCo, Executive Holdco, Executive II Holdco, Executive PIU, Holdco Parent, OpCo Parent, Company Merger Sub, Manager Merger Sub and OpCo Merger Sub. Subject to the terms of the Merger Agreement, (a) OpCo Merger Sub
will merge with and into OpCo, with OpCo surviving the merger, collectively owned, directly or indirectly, by OpCo Parent, Manager and certain Rollover Holders (as defined below) (the OpCo Merger), (b) immediately following the OpCo
Merger, Manager Merger Sub will merge with and into Manager, with Manager surviving the merger, wholly owned by the Company (the Manager Merger) and (c) immediately following the Manager Merger, Company Merger Sub will merge with
and into the Company, with the Company surviving the merger, collectively owned, directly or indirectly, by Holdco Parent and certain Rollover Holders (the Company Merger and, together with the Manager Merger and the OpCo Merger, the
Mergers and, together with the other transactions contemplated by the Merger Agreement, collectively, the Transactions). In connection with the Merger Agreement, Silver Lake Partners VI, L.P. and Silver Lake Partners VII,
L.P. have entered into a limited guarantee (the Limited Guarantee) with OpCo with respect to the payment of a termination fee that may be payable by the Parent Entities to OpCo under the Merger Agreement, as well as certain reimbursement
obligations that may be owed by the Parent Entities pursuant to the Merger Agreement, in each case, subject to the terms of the Merger Agreement and the Limited Guarantee.
Concurrently with the execution and delivery of the Merger Agreement on April 2, 2024, and as a condition and inducement to the Parent
Entities willingness to enter into the Merger Agreement, the following directors
1
and/or officers of the Company (and certain of their respective affiliates) Ariel Emanuel, Patrick Whitesell and Mark Shapiro (each, a Rollover Holder) entered into a
rollover agreement (each, a Rollover Agreement) with the Parent Entities, in connection with the Transactions. Pursuant to the Rollover Agreements, each Rollover Holder agreed, among other things and on the terms and subject to the
conditions set forth in the Rollover Agreements, to designate as Rollover Units or Rollover Shares (as applicable) the following equity interests in OpCo and/or in the Company held by such Rollover Holder and their permitted
transferees, with such Rollover Units and Rollover Shares to be treated in accordance with the terms of the Merger Agreement:
|
|
|
in the case of Mr. Emanuel, a number of equity interests in OpCo and/or in the Company held by him and his
permitted transferees that are shares of Company Common Stock, OpCo Membership Interests or OpCo Profits Units (each as defined below) that collectively, using the Merger Consideration (as defined below) applicable to such interests, have a value
equal to (i) the aggregate value of all such interests (calculated using the Merger Consideration applicable to such interests) minus (ii) $200,000,000, rounded to the nearest Company Common Stock, OpCo Membership Interest or OpCo
Profits Unit, as applicable; |
|
|
|
in the case of Mr. Whitesell, a number of equity interests in OpCo and/or in the Company held by him and his
permitted transferees that are shares of Company Common Stock, OpCo Membership Interests or OpCo Profits Units that collectively, using the Merger Consideration applicable to such interests, have a value equal to (i) the aggregate value of all
such interests (calculated using the Merger Consideration applicable to such interests) minus (ii) $150,000,000, rounded to the nearest Company Common Stock, OpCo Membership Interest or OpCo Profits Unit, as applicable; and
|
|
|
|
in the case of Mr. Shapiro, a number of equity interests in OpCo and/or in the Company held by him and his
permitted transferees that are outstanding and vested shares of Company Common Stock without any restrictions on such Company Common Stock or Units of OpCo (as defined in the OpCo Operating Agreement) with a value equal to $37,187,970 (based on the
applicable Merger Consideration). |
In addition, pursuant to the Rollover Agreements, each Rollover Holder agreed, among
other things, unless consented to in writing by the Parent Entities, not to sell, dispose of, assign, pledge, collateralize, encumber or otherwise transfer any of the Rollover Shares or Rollover Units (or, prior to the final designation of equity
interests of the Company and/or OpCo held by such Rollover Holder as such, any such equity interests in the Company or OpCo, subject to certain exceptions); however, the Rollover Holders are permitted to transfer the Rollover Shares and/or Rollover
Units prior to the closing of the Transactions (the Closing) to certain permitted transferees subject to execution of a joinder to the applicable Rollover Agreement by such permitted transferee.
At the effective time of the OpCo Merger (the OpCo Merger Effective Time), as a result of the OpCo Merger, (a) each common
unit of OpCo outstanding immediately prior to the OpCo Merger Effective Time (each, an OpCo Membership Interest and, collectively, the OpCo Membership Interests) (subject to certain exceptions, including (i) each OpCo
Membership Interest owned by the Company, Manager, OpCo, or any direct or indirect wholly owned subsidiary of OpCo, the Parent Entities or any direct or indirect wholly owned subsidiary of the Parent Entities or, solely to the extent designated in
writing by the Parent Entities to the Company at least two business days prior to the Effective Time (as defined below), any affiliate of the Parent Entities so designated, immediately prior to the OpCo Merger Effective Time (collectively, the
Excluded OpCo Membership Interests) and (ii) the Rollover Units in OpCo held by the Rollover Holders that remain outstanding in the OpCo Merger pursuant to the respective Rollover Holders Rollover Agreement) will automatically
be cancelled and converted into the right to receive $27.50 in cash minus any amounts that are distributed in respect of an OpCo Membership Interest in respect of the distributions contemplated by the restructuring transactions to be
undertaken by the Company Entities prior to Closing pursuant to the Merger Agreement and in accordance with the restructuring steps plan set forth on the Companys confidential disclosure letter delivered concurrently with the execution of the
Merger Agreement (the Restructuring Steps, and such amounts, the OpCo
2
Membership Interest Distribution Amount), without interest (the OpCo Merger Consideration) and subject to applicable withholding taxes, certain deferred payments under certain
terms of the existing OpCo Membership Interests and certain rights of the holders of OpCo Membership Interests to elect to cause their OpCo Membership Interests to remain outstanding through the OpCo Merger and cause the Company to acquire such OpCo
Membership Interests following the OpCo Merger for an amount in cash equal to the OpCo Merger Consideration that would have otherwise been paid in respect of such OpCo Membership Interests and (b) each profits unit of OpCo outstanding
immediately prior to the OpCo Merger Effective Time (OpCo Profits Unit) (other than any Rollover Units) will automatically be cancelled and converted into the right to receive the OpCo Merger Consideration less the strike
price of such OpCo Profits Unit in cash, without interest (the OpCo Profits Units Merger Consideration), and subject to applicable withholding taxes, certain deferred payments under certain terms of the existing OpCo Profits Units
and certain rights of the holders of OpCo Profits Units to elect to cause their OpCo Profits Units to remain outstanding through the OpCo Merger and cause the Company to acquire such OpCo Profits Units following the OpCo Merger for an amount in cash
equal to the OpCo Profits Units Merger Consideration that would have otherwise been paid in respect of such OpCo Profits Units.
At the
effective time of the Manager Merger (which will occur immediately after the OpCo Merger Effective Time) (the Manager Merger Effective Time), as a result of the Manager Merger, each common unit of Manager outstanding immediately prior to
the Manager Merger Effective Time (each, a Manager Membership Interest) (subject to certain exceptions, including each Manager Membership Interest owned by the Company or the Manager immediately prior to the Manager Merger Effective
Time) will automatically be cancelled and converted into the right to receive $27.50 in cash without interest (the Manager Merger Consideration), and subject to applicable withholding taxes and certain deferrals to take into account
certain terms of the existing Manager Membership Interests.
At the effective time of the Company Merger (which will occur immediately
after the Manager Merger Effective Time) (the Company Merger Effective Time or the Effective Time), as a result of the Company Merger, each share of Company Common Stock outstanding immediately prior to the Company Merger
Effective Time (subject to certain exceptions, including (i) (a) shares of Company Common Stock owned by the Company, Manager or OpCo or any of OpCos direct or indirect wholly owned subsidiaries, (b) shares of Company Common Stock
owned by the Merger Subs or the Parent Entities or any of Parent Entities direct or indirect wholly owned subsidiaries, or, any affiliate of the Parent Entities designated in writing by the Parent Entities to the Company at least two business
days prior to the Company Merger Effective Time and (c) shares of Class X Common Stock and Class Y Common Stock (each as defined herein) issued and outstanding immediately prior to the Company Merger Effective Time (collectively, the
Excluded Shares), (ii) each Rollover Share that is owned by a Rollover Holder and will remain outstanding in the Company Merger in accordance with such Rollover Holders Rollover Agreement and (iii) shares of Company Common
Stock owned by stockholders of the Company who have validly demanded and not withdrawn appraisal rights in accordance with Section 262 of the General Corporation Law of the State of Delaware (the DGCL)) will automatically be
cancelled and converted into the right to receive $27.50 in cash, without interest (the Company Merger Consideration and, together with the OpCo Merger Consideration, the OpCo Profits Units Merger Consideration and the Manager Merger
Consideration, with respect to such applicable equity securities, the Merger Consideration), and subject to applicable withholding taxes.
The Company is required to, in each calendar quarter prior to the Effective Time, declare and pay a dividend in respect of each issued and
outstanding share of Class A Common Stock at a price equal to $0.06 per share (the Per Share Dividend Amount and each dividend, a Quarterly Dividend). If, on the date that all other conditions to Closing are satisfied,
at least four Quarterly Dividends have not been paid, the Company will be required to pay, within three business days (and in any case prior to the Effective Time), a dividend in respect of each issued and outstanding share of Class A Common
Stock of the Company in an amount equal to the product of (i) the Per Share Dividend Amount and (ii) four minus the number of quarters in which a Quarterly Dividend has been declared and paid (or will be paid prior to the Effective
Time).
3
Following completion of the Mergers, the shares of Company Common Stock will cease to be
listed on the New York Stock Exchange and registration of the Company Common Stock under the Exchange Act will be terminated.
The Merger
Agreement and the Transactions were unanimously approved by the Executive Committee of the Company (the Executive Committee) upon the unanimous recommendation of a special committee of the board of directors of the Company (the
Special Committee and, such recommendation, the Special Committee Recommendation)a committee comprised solely of independent and disinterested directors that was established by the Executive Committee to review,
evaluate and negotiate the Merger Agreement, make a determination as to whether the Transactions are fair to, and in the best interests of, the Company, its stockholders, and the equityholders of Manager and OpCo and make a recommendation to the
Executive Committee with respect to the Transactions.
Concurrently with the filing of this Transaction Statement, the Company is filing a
notice of written consent and appraisal rights and information statement (the Information Statement) under Section 14(c) of the Exchange Act. A copy of the Information Statement is attached hereto as Exhibit (a)(1) and a copy of the
Merger Agreement is attached as Annex A to the Information Statement. The adoption of the Merger Agreement and the approval of the Mergers and the other Transactions required the affirmative vote or written consent of the holders of Company Common
Stock representing a majority of the aggregate voting power of the outstanding shares of Company Common Stock entitled to vote thereon pursuant to Section 228 and Section 251 of the DGCL. Following execution of the Merger Agreement,
(a) Silver Lake West HoldCo, L.P. and Silver Lake West HoldCo II, L.P. (together, the SLP Holders) and (b) Ariel Emanuel and Patrick Whitesell and each of their respective personal revocable trusts that holds shares of Company
Common Stock and/or OpCo Membership Interests, and the Executive Holdcos (together, the Management Holders and, together with the SLP Holders, the Specified Stockholders), who collectively held more than a majority of the
combined voting power of the outstanding shares of Class A Common Stock, par value $0.00001 per share (the Class A Common Stock), Class X common stock of the Company, par value $0.00001 per share (the Class X
Common Stock) and Class Y common stock of the Company, par value $0.00001 per share (the Class Y Common Stock and together with Class A Common Stock and the Class X Common Stock, the Company Common
Stock), executed and delivered to the Company a written consent (the Written Consent) approving and adopting the Merger Agreement and the Transactions, including the Mergers.
Pursuant to General Instruction F to Schedule 13E-3, the information contained in the Information
Statement, including all annexes thereto, is expressly incorporated herein by reference in its entirety, and responses to each item herein are qualified in their entirety by the information contained in the Information Statement and the annexes
thereto. The cross-references below are being supplied pursuant to General Instruction G to Schedule 13E-3 and show the location in the Information Statement of the information required to be included in
response to the items of Schedule 13E-3. As of the date hereof, the Information Statement is in preliminary form and is subject to completion.
All information contained in this Transaction Statement concerning any of the filing persons has been provided by such filing person and no
filing person has produced any disclosure with respect to any other filing persons.
ITEM 1. SUMMARY TERM SHEET
The information set forth in the Information Statement under the following captions is incorporated herein by reference:
Summary
Questions and Answers about the
Mergers
4
ITEM 2. SUBJECT COMPANY INFORMATION
(a) Name and Address. The information set forth in the Information Statement under the following caption is incorporated herein
by reference:
The Parties to the Merger Agreement
(b) Securities. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
Summary
Market Information,
Dividends and Certain Transactions in the Shares of Company Common Stock
(c) Trading Market and Price. The
information set forth in the Information Statement under the following caption is incorporated herein by reference:
Market Information, Dividends
and Certain Transactions in the Shares of Company Common Stock
(d) Dividends. The information set forth in the
Information Statement under the following caption is incorporated herein by reference:
The Merger Agreement Conduct of Business by the
Company Entities Prior to Consummation of the Mergers
Market Information, Dividends and Certain Transactions in the Shares of Company Common
Stock
(e) Prior Public Offerings. The information set forth in the Information Statement under the following captions
is incorporated herein by reference:
Summary
Market Information, Dividends and Certain Transactions in the Shares of Company Common Stock
(f) Prior Stock Purchases. The information set forth in the Information Statement under the following caption is incorporated
herein by reference:
Market Information, Dividends and Certain Transactions in the Shares of Company Common Stock
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSONS
(a)(c) Name and Address; Business and Background of Entities; Business and Background of Natural Persons. The information
set forth in the Information Statement under the following captions is incorporated herein by reference:
Summary
The Parties to the Merger Agreement
Directors,
Executive Officers and Controlling Persons of the Company
Where You Can Find More Information
ITEM 4. TERMS OF THE TRANSACTION
(a)(1) Material Terms Tender Offers. Not applicable.
(a)(2) Material Terms Merger or Similar Transactions. The information set forth in the Information Statement under the
following captions is incorporated herein by reference:
Summary
5
Questions and Answers about the Mergers
The Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Required Stockholder Approval for the Mergers
The Special Factors Opinion of Centerview
The Special Factors Opinion of Kroll
The Special Factors Opinion of Houlihan Lokey
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
The Special Factors Delisting and Deregistration of Company Common Stock
The Special Factors Certain Material United States Federal Income Tax Consequences of the Company Merger
The Special Factors Regulatory Approvals
The Merger Agreement
Annex A: Agreement and
Plan of Merger
Annex C: Opinion of Centerview Partners LLC
Annex D: Opinion of Kroll, LLC
Annex E:
Opinion of Houlihan Lokey Capital, Inc.
Annex F: Voting and Support Agreement
Annex G: Emanuel Rollover Agreement
Annex H:
Whitesell Rollover Agreement
Annex I: Shapiro Rollover Agreement
Annex J: Emanuel Letter Agreement
Annex K:
Whitesell Letter Agreement
Annex L: Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
(c) Different Terms. The information set forth in the Information Statement under the following captions is incorporated herein
by reference:
Summary
Questions and
Answers about the Merger
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
The Merger Agreement Consideration to be Received in the Mergers
The Merger Agreement Treatment of Company Equity Awards and Phantom Units
Other Agreements
Annex F: Voting and Support
Agreement
Annex G: Emanuel Rollover Agreement
Annex H: Whitesell Rollover Agreement
Annex I:
Shapiro Rollover Agreement
Annex J: Emanuel Letter Agreement
Annex K: Whitesell Letter Agreement
Annex L:
Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
6
(d) Appraisal Rights. The information set forth in the Information Statement
under the following captions is incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Merger Agreement Dissenting Shares
Appraisal Rights
Annex C: Section 262 of the Delaware General Corporation Law
(e) Provisions for Unaffiliated Security Holders. The information set forth in the Information Statement under the following
captions is incorporated herein by reference:
The Special Factors Recommendation of the Special Committee; Reasons for the
Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
Provisions for Unaffiliated Stockholders
Appraisal Rights
(f)
Eligibility for Listing or Trading. Not applicable.
ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS
(a) Transactions. The information set forth in the Information Statement under the following caption is incorporated herein by
reference:
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
Market Information, Dividends and Certain Transactions in the Shares of Company Common Stock
Where You Can Find More Information
(b)(c) Significant Corporate Events; Negotiations or Contacts. The information set forth in the Information Statement
under the following captions is incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Background of the Merger
The Special Factors Recommendation of the Executive Committee; Reasons for the
Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Required Stockholder Approval for the Mergers
The Special Factors Financing
The
Special Factors Limited Guarantee
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the
Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
The Special Factors Delisting and Deregistration of Company Common Stock
The Special Factors Fees and Expenses
7
The Merger Agreement Form of Mergers
The Merger Agreement Consummation and Effectiveness of the Mergers
The Merger Agreement Consideration to be Received in the Mergers
The Merger Agreement Treatment of Company Equity Awards and Phantom Units
The Merger Agreement Dividends
The
Merger Agreement Company Sales
The Merger Agreement Written Consent
The Merger Agreement Pre-Closing Restructuring
Other Agreements
Market Information, Dividends
and Certain Transactions in the Shares of Company Common Stock
Where You Can Find More Information
Annex A: Agreement and Plan of Merger
Annex F:
Voting and Support Agreement
Annex G: Emanuel Rollover Agreement
Annex H: Whitesell Rollover Agreement
Annex I:
Shapiro Rollover Agreement
Annex J: Emanuel Letter Agreement
Annex K: Whitesell Letter Agreement
Annex L:
Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P., Silver Lake Partners VI,
L.P., Silver Lake Partners VII, L.P. and SL SPV-4, L.P., attached hereto as Exhibit (b)(1).
Preferred Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., DFO Private Investments, L.P. and Thirty
Fifth Investment Company L.L.C., attached hereto as Exhibit (b)(2).
Preferred Equity Commitment Letter, dated June 6, 2024, by and
among Wildcat EGH Holdco, L.P. and Coatue Tactical Solutions PS Holdings AIV 9 LP, attached hereto as Exhibit (b)(4).
Preferred Equity
Commitment Letter, dated July 29, 2024, by and among Wildcat EGH Holdco, L.P., and Meritage Fund Select I LLC, attached hereto as Exhibit (b)(5).
Debt Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., JPMorgan Chase Bank, N.A., Morgan Stanley Senior
Funding, Inc., Bank of America, N.A., Goldman Sachs Bank USA, Barclays Bank PLC, Deutsche Bank Securities Inc., Deutsche Bank AG New York Branch and Royal Bank of Canada, attached hereto as Exhibit (b)(3).
Limited Guarantee, dated April 2, 2024, by and among Silver Lake Partners VI, L.P., Silver Lake Partners VII, L.P. and Endeavor Operating
Company, LLC, attached hereto as Exhibit (b)(6).
(e) Agreements Involving the Subject Companys Securities. The
information set forth in the Information Statement under the following captions is incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the
Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Required Stockholder Approval for the Mergers
The Special Factors Financing
The
Special Factors Limited Guarantee
8
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the
Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
The Special Factors Delisting and Deregistration of Company Common Stock
The Special Factors Fees and Expenses
The Merger Agreement Form of Merger
The
Merger Agreement Consummation and Effectiveness of the Mergers
The Merger Agreement Consideration to be Received in the
Mergers
The Merger Agreement Treatment of Company Equity Awards and Phantom Units
The Merger Agreement Dividends
The
Merger Agreement Company Sales
The Merger Agreement Written Consent
The Merger Agreement Financing Covenant; Company Cooperation
The Merger Agreement Pre-Closing Restructuring
Other Agreements
Market Information, Dividends
and Certain Transactions in the Shares of Company Common Stock
Annex A: Agreement and Plan of Merger
Annex F: Voting and Support Agreement
Annex G:
Emanuel Rollover Agreement
Annex H: Whitesell Rollover Agreement
Annex I: Shapiro Rollover Agreement
ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS
(b) Use of Securities Acquired. The information set forth in the Information Statement under the following captions is
incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Delisting and Deregistration of Company Common Stock
The Merger Agreement Form of Mergers
The Merger Agreement Consideration to be Received in the Mergers
The Merger Agreement Treatment of Company Equity Awards and Phantom Units
(c)(1)(8) Plans. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
Summary
Questions and Answers
about the Mergers
The Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
9
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the
Mergers
The Special Factors Interests of Our Directors and Executive Officers in the Merger
The Special Factors Delisting and Deregistration of Company Common Stock
The Special Factors Fees and Expenses
The Merger Agreement
Other Agreements
Market Information, Dividends and Certain Transactions in the Shares of Company Common Stock
Annex A: Agreement and Plan of Merger
Annex J:
Emanuel Letter Agreement
Annex K: Whitesell Letter Agreement
Annex L: Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
ITEM 7. PURPOSES, ALTERNATIVES, REASONS AND EFFECTS
(a) Purposes. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
Summary
The Special Factors
Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
(b) Alternatives. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
The Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
(c) Reasons. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
Summary
The Special Factors
Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
10
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with
the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
(d) Effects. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
Summary
Questions and Answers
about the Mergers
The Special Factors Background of the Merger
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Financing
The
Special Factors Limited Guarantee
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the
Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
The Special Factors Delisting and Deregistration of Company Common Stock
The Special Factors Fees and Expenses
The Special Factors Certain Material United States Federal Income Tax Consequences of the Mergers
The Merger Agreement Form of Mergers
The Merger Agreement Consummation and Effectiveness of the Mergers
The Merger Agreement Consideration to be Received in the Mergers
The Merger Agreement Dissenting Shares
The Merger Agreement Treatment of Company Equity Awards and Phantom Units
The Merger Agreement Certificate of Incorporation; Bylaws
The Merger Agreement Continuing Employee Matters
The Merger Agreement Company Sales
The
Merger Agreement Indemnification and Insurance
Other Agreements
Appraisal Rights
Annex A: Agreement and Plan
of Merger
Annex C: Section 262 of the Delaware General Corporation Law
Annex F: Voting and Support Agreement
Annex G:
Emanuel Rollover Agreement
Annex H: Whitesell Rollover Agreement
Annex I: Shapiro Rollover Agreement
Annex J:
Emanuel Letter Agreement
Annex K: Whitesell Letter Agreement
Annex L: Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P., Silver Lake Partners VI,
L.P., Silver Lake Partners VII, L.P. and SL SPV-4, L.P., attached hereto as Exhibit (b)(1).
Preferred Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., DFO Private Investments, L.P. and Thirty
Fifth Investment Company L.L.C., attached hereto as Exhibit (b)(2).
11
Preferred Equity Commitment Letter, dated June 6, 2024, by and among Wildcat EGH
Holdco, L.P. and Coatue Tactical Solutions PS Holdings AIV 9 LP, attached hereto as Exhibit (b)(4).
Preferred Equity Commitment Letter,
dated July 29, 2024, by and among Wildcat EGH Holdco, L.P., and Meritage Fund Select I LLC, attached hereto as Exhibit (b)(5).
Debt
Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., JPMorgan Chase Bank, N.A., Morgan Stanley Senior Funding, Inc., Bank of America, N.A., Goldman Sachs Bank USA, Barclays Bank PLC, Deutsche Bank Securities Inc.,
Deutsche Bank AG New York Branch and Royal Bank of Canada, attached hereto as Exhibit (b)(3).
Limited Guarantee, dated April 2,
2024, by and among Silver Lake Partners VI, L.P., Silver Lake Partners VII, L.P. and Endeavor Operating Company, LLC, attached hereto as Exhibit (b)(6).
ITEM 8. FAIRNESS OF THE TRANSACTION
(a)(b) Fairness; Factors Considered in Determining Fairness. The information set forth in the Information Statement under
the following captions is incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the
Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Opinion of Centerview
The Special Factors Certain Company Financial Forecasts
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the Company, Manager and OpCo in Connection with the Mergers
The Special Factors Purposes and Reasons of the Director Rollover Holders in Connection with the Mergers
The Special Factors Purposes and Reasons of the SLP Entities in Connection with the Mergers
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
Annex C: Opinion of Centerview Partners LLC
The confidential discussion materials prepared by Centerview Partners LLC and provided to the Special Committee, dated March 8, 2024,
March 21, 2024, March 29, 2024, March 30, 2024, March 30, 2024, March 31, 2024 and April 2, 2024, are attached hereto as Exhibits (c)(2) through and including (c)(8), and are incorporated by reference herein.
(c) Approval of Security Holders. The information set forth in the Information Statement under the following captions is
incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Background of the Merger
The Special Factors Recommendation of the Executive Committee; Reasons for the
Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Required Stockholder Approval for the Mergers
The Merger Agreement Written Consent
(d) Unaffiliated Representative. Not applicable.
12
(e) Approval of Directors. The information set forth in the Information
Statement under the following captions is incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the
Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
(f) Other Offers. The information set forth in the Information Statement under the following captions is incorporated by
reference:
The Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Merger Agreement No Solicitation
ITEM 9. REPORTS, OPINIONS, APPRAISALS AND NEGOTIATIONS
(a)(c) Report, Opinion or Appraisal; Preparer and Summary of the Report, Opinion or Appraisal; Availability of Documents.
The information set forth in the Information Statement under the following captions is incorporated herein by reference:
Summary
The Special Factors Background
of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Opinion of Centerview
The Special Factors Opinion of Kroll
The Special Factors Opinion of Houlihan Lokey
The Special Factors Certain Company Financial Forecasts
The Special Factors Position of the Company, Manager and OpCo on the Fairness of the Mergers
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
Annex C: Opinion of Centerview Partners LLC
Annex D: Opinion of Kroll, LLC
Annex E:
Opinion of Houlihan Lokey Capital, Inc.
The confidential discussion materials prepared by Centerview Partners LLC and provided to
the Special Committee, dated March 8, 2024, March 21, 2024, March 29, 2024, March 30, 2024, March 30, 2024, March 31, 2024 and April 2, 2024, are attached hereto as Exhibits (c)(2) through and including (c)(8), and
are incorporated by reference herein.
The reports, opinions or appraisals referenced in this Item 9 are filed herewith and will be made
available for inspection and copying at the principal executive offices of Endeavor during its regular business hours by any interested holder of Company Common Stock or representative who has been designated in writing, and copies
13
may be obtained by requesting them in writing from Endeavor at the email address provided under the caption Where You Can Find More Information in the Information Statement, which is
incorporated herein by reference.
ITEM 10. SOURCE AND AMOUNTS OF FUNDS OR OTHER CONSIDERATION
(a)(b) Source of Funds; Conditions. The information set forth in the Information Statement under the following captions is
incorporated herein by reference:
Summary
Questions and Answers about the Mergers
The
Special Factors Financing
The Special Factors Limited Guarantee
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Merger Agreement Consummation and Effectiveness of the Mergers
The Merger Agreement Financing Covenant; Company Cooperation
(c) Expenses. The information set forth in the Information Statement under the following caption is incorporated herein by
reference:
The Special Factors Fees and Expenses
(d) Borrowed Funds. The information set forth in the Information Statement under the following captions is incorporated herein by
reference:
Summary
Questions and Answers
about the Merger
The Special Factors Financing
The Special Factors Limited Guarantee
The Special Factors Position of the SLP Entities and the Director Rollover Holders in Connection with the Mergers
The Merger Agreement Financing Covenant; Company Cooperation
ITEM 11. INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a) Securities Ownership. The information set forth in the Information Statement under the following caption is incorporated
herein by reference:
Security Ownership of Certain Beneficial Owners and Management
(b) Securities Transactions. The information set forth in the Information Statement under the following captions is incorporated
herein by reference:
The Special Factors Background of the Mergers
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
The Merger Agreement
Other Agreements
Market Information, Dividends and Certain Transactions in the Shares of Company Common Stock
Annex A: Agreement and Plan of Merger
Annex G:
Emanuel Rollover Agreement
Annex H: Whitesell Rollover Agreement
Annex I: Shapiro Rollover Agreement
Annex J:
Emanuel Letter Agreement
Annex K: Whitesell Letter Agreement
Annex L: Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
14
ITEM 12. THE SOLICITATION OR RECOMMENDATION
(d) Intent to Tender or Vote in a Going-Private Transaction. Not applicable.
(e) Recommendations of Others. Not applicable.
ITEM 13. FINANCIAL STATEMENTS
(a) Financial Statements. The audited financial statements set forth in Endeavors Annual Report on Form 10-K for the year ended December 31, 2023 and the unaudited balance sheets, comparative year-to-date statements of comprehensive
income and related earnings per share data and statements of cash flows set forth in Endeavors Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 are incorporated by reference
herein. The information is set forth in the Information Statement under the following caption is incorporated herein by reference:
Where You Can
Find More Information
(b) Pro Forma Information. Not applicable.
ITEM 14. PERSONS/ASSETS, RETAINED, EMPLOYED, COMPENSATED OR USED
(a) Solicitations or Recommendations. Not applicable.
(b) Employees and Corporate Assets. The information set forth in the Information Statement under the following captions is
incorporated herein by reference:
Summary
The Special Factors Background of the Mergers
The Special Factors Recommendation of the Executive Committee; Reasons for the Mergers
The Special Factors Recommendation of the Special Committee; Reasons for the Recommendation
The Special Factors Opinion of Centerview
The Special Factors Opinion of Kroll
The Special Factors Opinion of Houlihan Lokey
The Special Factors Interests of Our Directors and Executive Officers in the Merger
The Special Factors Fees and Expenses
Other Agreements
Annex C: Opinion of
Centerview Partners LLC
Annex D: Opinion of Kroll, LLC
Annex E: Opinion of Houlihan Lokey Capital, Inc.
Annex G: Emanuel Rollover Agreement
Annex H:
Whitesell Rollover Agreement
Annex I: Shapiro Rollover Agreement
Annex J: Emanuel Letter Agreement
Annex K:
Whitesell Letter Agreement
Annex L: Shapiro Employment Agreement Amendment
Annex M: Shapiro A&R Employment Agreement
15
ITEM 15. ADDITIONAL INFORMATION
(b) Golden Parachute Compensation. The information set forth in the Information Statement under the following captions is incorporated
herein by reference:
The Special Factors Interests of Our Directors and Executive Officers in the Mergers
(c) Other Material Information. The information set forth in the Information Statement, including all annexes thereto, is
incorporated herein by reference.
Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo
Holdco, L.P., Silver Lake Partners VI, L.P., Silver Lake Partners VII, L.P. and SL SPV-4, L.P., attached hereto as Exhibit (b)(1).
Preferred Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., DFO Private Investments, L.P. and Thirty
Fifth Investment Company L.L.C., attached hereto as Exhibit (b)(2).
Preferred Equity Commitment Letter, dated June 6, 2024, by and
among Wildcat EGH Holdco, L.P. and Coatue Tactical Solutions PS Holdings AIV 9 LP, attached hereto as Exhibit (b)(4).
Preferred Equity
Commitment Letter, dated July 29, 2024, by and among Wildcat EGH Holdco, L.P. and Meritage Fund Select I LLC, attached hereto as Exhibit (b)(5).
Debt Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., JPMorgan Chase Bank, N.A., Morgan Stanley Senior
Funding, Inc., Bank of America, N.A., Goldman Sachs Bank USA, Barclays Bank PLC, Deutsche Bank Securities Inc., Deutsche Bank AG New York Branch and Royal Bank of Canada, attached hereto as Exhibit (b)(3).
Limited Guarantee, dated April 2, 2024, by and among Silver Lake Partners VI, L.P., Silver Lake Partners VII, L.P. and Endeavor Operating
Company, LLC, attached hereto as Exhibit (b)(6).
ITEM 16. EXHIBITS
|
|
|
Exhibit No. |
|
Description |
|
|
(a)(1) |
|
Preliminary Information Statement of Endeavor Group Holdings, Inc. (included in the Schedule 14C filed on August 5, 2024, and incorporated herein by reference) (the Preliminary Information Statement). |
|
|
(b)(1)* |
|
Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P., Silver Lake Partners VI, L.P., Silver Lake Partners VII, L.P. and SL SPV-4, L.P. |
|
|
(b)(2)* |
|
Preferred Equity Commitment Letter, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., DFO Private Investments, L.P. and Thirty Fifth Investment Company L.L.C. |
|
|
(b)(3)*
|
|
Amended and Restated Commitment Letter, dated April 19, 2024, by and among Wildcat EGH Holdco, L.P., JPMorgan Chase Bank, N.A., BofA Securities, Inc., Morgan Stanley Senior Funding, Inc., Bank of America, N.A., Goldman Sachs Bank USA, Barclays Bank PLC, Deutsche Bank Securities Inc., Deutsche Bank AG New York Branch, Royal Bank of Canada, Wells Fargo Bank, National Association, Wells Fargo Securities, Inc., Citigroup Global Markets Inc., HSBC Bank USA, National Association and HSBC Securities (USA) Inc. |
|
|
(b)(4)* |
|
Preferred Equity Commitment Letter, dated June 6, 2024, by and among Wildcat EGH Holdco, L.P. and Coatue Tactical Solutions PS Holdings AIV 9 LP. |
|
|
(b)(5)* |
|
Preferred Equity Commitment Letter, dated July 29, 2024, by and among Wildcat EGH Holdco, L.P., and Meritage Fund Select I LLC. |
16
|
|
|
Exhibit No. |
|
Description |
|
|
(b)(6)* |
|
Limited Guarantee, dated April 2, 2024, by and among Silver Lake Partners VI, L.P., Silver Lake Partners VII, L.P. and Endeavor Operating Company, LLC. |
|
|
(c)(1) |
|
Opinion of Centerview Partners LLC to the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc., dated April 2, 2024 (included as Annex C to the Preliminary Information Statement and incorporated herein
by reference). |
|
|
(c)(2)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated March 8, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(3)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated March 21, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(4)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated March 29, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(5)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated March 30, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(6)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated March 30, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(7)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated March 31, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(8)* |
|
Confidential discussion materials prepared by Centerview Partners LLC, dated April 2, 2024, for the Special Committee of the Board of Directors of Endeavor Group Holdings, Inc. |
|
|
(c)(9) |
|
Opinion of Kroll, LLC to the to the General Partners (as defined therein) and the LPAC (as defined therein) of the Selling Funds (as defined therein), dated April 1, 2024 (included as Annex D to the Preliminary Information
Statement and incorporated herein by reference) |
|
|
(c)(10) |
|
Opinion of Houlihan Lokey Capital, Inc. to the to the GPs (as defined therein) and the Buying Funds (as defined therein), dated April 1, 2024 (included as Annex E to the Preliminary Information Statement and incorporated herein
by reference). |
|
|
(d)(1) |
|
Agreement and Plan of Merger, dated as of April 2, 2024, by and among Endeavor Group Holdings, Inc., Endeavor Executive Holdco, LLC, Endeavor Executive II Holdco, LLC, Endeavor Executive PIU Holdco, LLC, Endeavor Manager, LLC,
Endeavor Operating Company, LLC, Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P., Wildcat PubCo Merger Sub, Inc., Wildcat OpCo Merger Sub, L.L.C. and Wildcat Manager Merger Sub, L.L.C. (included as Annex A to the Preliminary Information
Statement and incorporated herein by reference). |
|
|
(d)(2) |
|
Voting and Support Agreement, dated as of April 2, 2024, by and among Endeavor Group Holdings, Inc., Endeavor Manager, LLC, Endeavor Operating Company, LLC, Silver Lake West HoldCo, L.P. and Silver Lake West HoldCo II, L.P.
(included as Annex F to the Preliminary Information Statement and incorporated herein by reference). |
|
|
(d)(3) |
|
Letter Agreement, dated as of April 2, 2024, by and among Ariel Emanuel, Endeavor Group Holdings, Inc., Endeavor Operating Company, LLC, Wildcat EGH Holdco, L.P., Wildcat Opco Holdco, L.P. and, for purposes of certain specified
sections therein, William Morris Endeavor Entertainment, LLC (included as Annex J to the Preliminary Information Statement and incorporated herein by reference). |
|
|
(d)(4) |
|
Letter Agreement, dated as of April 2, 2024, by and among Patrick Whitesell, Endeavor Group Holdings, Inc., Endeavor Operating Company, LLC, Wildcat EGH Holdco, L.P., Wildcat Opco Holdco, L.P. and, for purposes of certain
specified sections therein, William Morris Endeavor Entertainment, LLC (included as Annex K to the Preliminary Information Statement and incorporated herein by reference). |
17
|
|
|
Exhibit No. |
|
Description |
|
|
(d)(5) |
|
Amendment No. 2 to Term Employment Agreement, dated as of April 2, 2024, by and among Mark Shapiro, Endeavor Group Holdings, Inc. and Endeavor Operating Company, LLC (included as Annex L to the Preliminary Information
Statement and incorporated herein by reference). |
|
|
(d)(6) |
|
Amended and Restated Term Employment Agreement, dated as of April 2, 2024, by and among Mark Shapiro, Endeavor Group Holdings, Inc., Wildcat EGH Holdco, L.P., Wildcat Opco Holdco, L.P., Endeavor Operating Company, LLC and, for
purposes of certain specified sections therein, William Morris Endeavor Entertainment, LLC (included as Annex M to the Preliminary Information Statement and incorporated herein by reference). |
|
|
(d)(7) |
|
Rollover Agreement, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P., Ariel Emanuel, The Ariel Z. Emanuel Living Trust, dated November 13, 2017, Endeavor Executive Holdco, LLC, Endeavor
Executive Holdco II, LLC and Endeavor Executive PIU Holdco, LLC (included as Annex G to the Preliminary Information Statement and incorporated herein by reference). |
|
|
(d)(8) |
|
Rollover Agreement, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P., Patrick Whitesell, The Patrick Whitesell Revocable Trust, dated May 31, 2019, Endeavor Executive Holdco, LLC,
Endeavor Executive Holdco II, LLC and Endeavor Executive PIU Holdco, LLC (included as Annex H to the Preliminary Information Statement and incorporated herein by reference). |
|
|
(d)(9) |
|
Rollover Agreement, dated April 2, 2024, by and among Wildcat EGH Holdco, L.P., Wildcat OpCo Holdco, L.P. and Mark Shapiro (included as Annex I to the Preliminary Information Statement and incorporated herein by
reference). |
|
|
(f)(1) |
|
Section 262 of the Delaware General Corporation Law (included as Annex B to the Preliminary Information Statement and incorporated herein by reference). |
|
|
107* |
|
Filing Fee Table. |
|
Certain portions of this exhibit have been redacted and separately filed with the SEC pursuant to a request for
confidential treatment. |
18
SIGNATURES
After due inquiry and to the best of each of the undersigneds knowledge and belief, each of the undersigned certifies that the
information set forth in this statement is true, complete and correct.
Dated as of August 5, 2024
|
|
|
ENDEAVOR GROUP HOLDINGS, INC. |
|
|
By: |
|
/s/ Jason Lublin |
Name: Jason Lublin |
Title: Chief Financial Officer |
|
ENDEAVOR OPERATING COMPANY, LLC |
|
|
By: |
|
/s/ Jason Lublin |
Name: Jason Lublin |
Title: Chief Financial Officer |
|
ENDEAVOR MANAGER, LLC |
|
|
By: |
|
/s/ Jason Lublin |
Name: Jason Lublin |
Title: Chief Financial Officer |
|
ENDEAVOR EXECUTIVE HOLDCO, LLC |
|
|
By: |
|
/s/ Patrick Whitesell |
Name: Patrick Whitesell |
Title: Director |
|
ENDEAVOR EXECUTIVE II HOLDCO, LLC |
|
|
By: |
|
/s/ Patrick Whitesell |
Name: Patrick Whitesell |
Title: Director |
|
ENDEAVOR EXECUTIVE PIU HOLDCO, LLC |
|
|
By: |
|
/s/ Patrick Whitesell |
Name: Patrick Whitesell |
Title: Director |
|
SILVER LAKE WEST HOLDCO, L.P. |
|
By: SILVER LAKE WEST VOTECO, L.L.C., its general partner |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Managing Member |
19
|
|
|
SILVER LAKE WEST HOLDCO II, L.P. |
|
By: SILVER LAKE WEST VOTECO, L.L.C., its general partner |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Managing Member |
|
SILVER LAKE WEST VOTECO, L.L.C. |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Managing Member |
|
WILDCAT EGH HOLDCO, L.P. |
|
By: SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
By: SLTA VII (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
WILDCAT OPCO HOLDCO, L.P. |
|
By: SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
By: SLTA VII (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
20
|
|
|
|
WILDCAT PUBCO MERGER SUB, INC. |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: President |
|
WILDCAT OPCO MERGER SUB, L.L.C. |
|
By: WILDCAT OPCO HOLDCO, L.P., its managing member |
|
By: SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
By: SLTA VII (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
WILDCAT MANAGER MERGER SUB, L.L.C. |
|
By: WILDCAT PUBCO MERGER SUB, INC., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: President |
|
SLP WILDCAT AGGREGATOR GP, L.L.C. |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
By: SLTA VII (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
21
|
|
|
SILVER LAKE PARTNERS VI, L.P. |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VI, L.P., its general partner |
|
By: SLTA VI (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
SILVER LAKE PARTNERS VII, L.P. |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its general partner |
|
By: SLTA VII (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
SL SPV-4, L.P. |
|
By: SLTA SPV-4, L.P., its general partner |
|
By: SLTA SPV-4 (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VI, L.P. |
|
By: SLTA VI (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
22
|
|
|
|
SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P. |
|
By: SLTA VII (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
|
|
SLTA SPV-4, L.P. |
|
By: SLTA SPV-4 (GP), L.L.C., its general partner |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
SLTA VI (GP), L.L.C. |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
SLTA VII (GP), L.L.C. |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
SLTA SPV-4 (GP), L.L.C. |
|
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
23
|
|
|
SILVER LAKE GROUP, L.L.C. |
|
|
By: |
|
/s/ Egon Durban |
Name: Egon Durban |
Title: Co-CEO |
|
ARIEL EMANUEL |
|
/s/ Ariel Emanuel |
|
PATRICK WHITESELL |
|
/s/ Patrick Whitesell |
24
Exhibit (B)(1)
April 2, 2024
Wildcat EGH Holdco, L.P.
c/o Silver Lake Partners
2775 Sand Hill Road, Suite 100
Menlo Park, CA 94025
c/o Wildcat OpCo Holdco, L.P.
c/o Silver Lake Partners
2775 Sand Hill Road, Suite 100
Menlo Park, CA 94025
Re: |
Equity Financing Commitment |
Ladies and Gentlemen:
Reference is made to the
Agreement and Plan of Merger, dated as of the date hereof (as amended, supplemented or otherwise modified from time to time in accordance with its terms, the Merger Agreement), by and among Wildcat EGH Holdco, L.P., a Delaware
limited partnership (Holdco Parent), Wildcat OpCo Holdco, L.P., a Delaware limited partnership (OpCo Parent and, together with Holdco Parent, the Parent Entities and each, a Parent
Entity), Wildcat PubCo Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Holdco Parent (Company Merger Sub), Wildcat Manager Merger Sub, L.L.C., a Delaware limited liability company and wholly-owned
subsidiary of Company Merger Sub (Manager Merger Sub), Wildcat OpCo Merger Sub, L.L.C., a Delaware limited liability company and wholly-owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Company
Merger Sub and Manager Merger Sub, the Merger Subs and each, a Merger Sub), Endeavor Group Holdings, Inc., a Delaware corporation (the Company), Endeavor Manager, LLC, a Delaware limited
liability company and subsidiary of the Company (the Manager), and Endeavor Operating Company, LLC, a Delaware limited liability company and subsidiary of the Manager (OpCo and, together with the Company and the
Manager, the Company Entities and each, a Company Entity), pursuant to which, upon the terms and subject to the conditions set forth therein, among other things, the Parent Entities will acquire the Company
Entities by (i) causing Company Merger Sub to merge with and into the Company, with the Company surviving as a wholly-owned subsidiary of Holdco Parent, (ii) causing Manager Merger Sub to merge with and into the Manager, with the Manager
surviving as an indirect subsidiary of Holdco Parent and (iii) causing OpCo Merger Sub to merge with and into OpCo, with the OpCo surviving as the surviving company owned by the OpCo Parent, the Manager and the Rollover Holders (as defined
therein). Each capitalized term or other term used and not defined herein but defined in the Merger Agreement shall have the meaning ascribed to it in the Merger Agreement, except as otherwise provided. Each of Silver Lake Partners VI, L.P.
(SLP Fund VI), Silver Lake Partners VII, L.P. (SLP Fund VII) and SL SPV-4, L.P. (SLP SPV) is referred to herein as an Equity Investor and
collectively, the Equity Investors. This letter agreement is being delivered by the Equity Investors to the Parent Entities in connection with the execution of the Merger Agreement.
1. Commitment. Subject to the conditions set forth herein, each Equity Investor
hereby agrees to purchase immediately prior to the Closing, equity interests of Holdco Parent (or, to the extent designated by Holdco Parent prior to Closing, OpCo Parent) (collectively, the Subject Equity Securities) for an
aggregate purchase price equal to, or otherwise make contributions to or invest funds as equity in Holdco Parent (or, to the extent designated by Holdco Parent prior to Closing, OpCo Parent) in an aggregate amount equal to, the respective proportion
set forth opposite such Equity Investors name on Schedule A hereto (such proportion for such Equity Investor, as may be adjusted pursuant to the terms hereof, being its Respective Proportion) such that the aggregate
purchase price for all such equity interests purchased by all such Equity Investors shall equal an aggregate purchase price of $6,376,940,000 (the Equity Financing Commitment) (the allocation of the Equity Financing Commitment
between Holdco Parent and OpCo Parent to be designated in writing by the Equity Investors prior to Closing). The Equity Financing Commitment shall be used by the Parent Entities solely for the purpose of funding, along with the proceeds of the Debt
Financing, the Required Amount pursuant to and in accordance with the terms and conditions of the Merger Agreement, and not for any other purpose; provided, each Equity Investor (together with its permitted assigns, as applicable) shall not
under any circumstances be obligated under this letter agreement to fund an amount in excess of its Respective Proportion of the Equity Financing Commitment. The Equity Investors obligations to fund their Respective Proportions of the Equity
Financing Commitment is several and not joint such that each Equity Investor (together with its permitted assigns, as applicable) is only obligated to funds its Respective Proportion of the Equity Financing Commitment. The obligation of each Equity
Investor (together with its permitted assigns, as applicable) to fund its Respective Proportion of the Equity Financing Commitment is subject solely to:
(a) the satisfaction or waiver of the conditions precedent to the Parent Entities obligations to effect the Closing set forth in Sections
8.01 and 8.02 of the Merger Agreement (other than those conditions that by their nature are to be satisfied at the Closing, but subject to such conditions being able to be satisfied (or waived));
(b) the prior or substantially concurrent funding of the proceeds of the Debt Financing pursuant to the Debt Commitment Letter solely with
respect to amounts required to consummate the Mergers; and
(c) the substantially concurrent consummation of the Closing on the terms and
subject to the conditions of the Merger Agreement (including, if applicable, pursuant to an order requiring the Parent Entities to specifically perform their obligations to effectuate the Closing pursuant to the terms of the Merger Agreement).
The amount to be funded under this letter agreement may be reduced dollar for dollar (any such reduction to be allocated between the Equity Investors as
designated in writing by the Parent Entities or otherwise on a pro rata basis between the Equity Investors) solely to the extent that the Parent Entities and the Merger Subs do not require the full amount of the Equity Financing Commitment in
connection with the payment of the Required Amount, it being understood that any such reduction pursuant to this paragraph shall only occur to the extent that, after giving effect to any such reduction, the Parent Entities would still be able to
fully and timely consummate the Transactions (including, for the avoidance of doubt, payment of the Required Amount) in
2
accordance with the terms of the Merger Agreement. The amount to be funded under this letter agreement may also be reduced dollar for dollar (and such reduction to be allocated between the Equity
Investors as designated by the Parent Entities) by an amount equal to the value (based on the applicable Merger Consideration) of Shares and OpCo Membership Interests that are beneficially owned by the Equity Investors or their Affiliates and for
which the Equity Investors agree irrevocably in writing that such Shares and OpCo Membership Interests shall be Rollover Shares or Rollover Units, as applicable, pursuant to the applicable Rollover Agreements, it being understood that any such
reduction pursuant to this paragraph shall only occur to the extent that such Rollover Shares or Rollover Units, as applicable, are treated as Rollover Shares or Rollover Units under the Merger Agreement at the Company Merger Effective Time and OpCo
Merger Effective Time, as applicable.
2. Termination. This letter agreement and each Equity Investors obligation to fund its
Respective Proportion of the Equity Financing Commitment will terminate automatically and immediately upon the earliest to occur of:
(a)
the valid termination of the Merger Agreement in accordance with its terms (provided that, for the avoidance of doubt, any purported termination of the Merger Agreement that is not, or is later determined not to have been, a valid termination
shall not give rise to a termination pursuant to this Section 2(a));
(b) the filing by the Company or any of
its Subsidiaries of any Action against the Equity Investors, the Parent Entities or Merger Subs or any Parent Related Party (as defined below) in respect of this letter agreement, the limited guarantee of even date herewith of the Equity Investors
(the Guarantee) or the Merger Agreement (including in respect of any oral representations made or alleged to be made in connection therewith) other than in connection with any claims or other Actions (i) for (A) equitable
relief against the Parent Entities or the Merger Subs (or their respective permitted assignees and successors) pursuant to, and subject to any applicable limitations set forth in, Section 10.08 of the Merger Agreement and this letter agreement,
if any, (B) payment of the Parent Termination Fee and any Additional Obligations, and/or (C) other remedies (whether for equitable relief or otherwise) available to the Company Entities against the Parent Entities or the Merger Subs (or
their respective permitted assignees and successors) under the Merger Agreement, in each case in accordance with, and solely to the extent permitted under, the Merger Agreement, (ii) against the Equity Investors (or their respective permitted
assignees or successors) for (X) payment of their respective obligations under the Guarantee in accordance with, and solely to the extent permitted under, the Guarantee, (Y) specific performance of, or other equitable relief that enforces,
the Equity Investors obligations to fund the Equity Financing Commitment in accordance with, and solely to the extent permitted under, the terms hereof and the terms of the Merger Agreement, and/or (Z) other remedies available to the
Company Entities against the Equity Investors (or their respective permitted assignees and successors) under the terms of the Guarantee, in each case in accordance with, and solely to the extent permitted under, the terms thereof, (iii) against
Silver Lake Technology Management, L.L.C. (or its permitted assignees or successors) under the Confidentiality Agreement in accordance with, and solely to the extent permitted under, the terms thereunder, (iv) against the Equity Investors (or
their permitted assignees or successors), the Parent Entities (or their permitted assignees or
3
successors) or the Merger Subs (or their permitted assignees or successors) under any other agreement entered into by any such Persons and the Company or its Subsidiaries after the date hereof,
in each case, in accordance with, and solely to the extent permitted under, such agreements, and (v) to enforce the terms of the Rollover Agreements with the Management Holders and the Voting Agreement, as applicable, in accordance with, and
solely to the extent permitted by, the terms of the Rollover Agreements with the Management Holders and the Voting Agreement, as applicable (the Actions contemplated by the foregoing clauses (i), (ii), (iii), (iv) and (v), the Non-Prohibited Claims);
(c) any final,
non-appealable judgment of a court of competent jurisdiction against the Equity Investors with respect to any Non-Prohibited Claim by the Company or any of its
Subsidiaries that includes an award of the Parent Termination Fee and/or the Additional Obligations; and
(d) the Closing and the payment
of the Required Amount in accordance with the terms of the Merger Agreement (only after which the obligations hereunder shall be discharged).
Upon
termination of this letter agreement pursuant to the terms hereof, the Equity Investors shall not have any further obligations or liabilities hereunder. Sections 2 (Termination), 4 (Assignment; Amendments and Waivers;
Entire Agreement), 5 (Parties in Interest), 6 (Limited Recourse; Enforcement), 7 (Confidentiality) and 8 (Governing Law; Jurisdiction; Waiver of Jury Trial) of this letter agreement shall
survive and remain in full force and effect, notwithstanding any termination of this letter agreement. For the avoidance of doubt, upon the valid termination of this letter agreement pursuant to the terms hereof, all obligations of the Equity
Investors to fund the Equity Financing Commitment shall terminate and no surviving provision shall be deemed to require the Equity Investors to fund any portion of the Equity Financing Commitment.
3. Representations and Warranties. Each Equity Investor hereby represents and warrants (and makes no other representations or
warranties, express or implied) that:
(a) It is duly organized or incorporated, validly existing and in good standing under the laws of
its jurisdiction of organization or incorporation.
(b) The execution, delivery of and performance under this letter agreement by it is
within its organizational or corporate powers and has been duly authorized by all necessary organizational or corporate (or equivalent) action.
(c) This letter agreement has been duly executed and delivered by it and, assuming the due authorization, execution and delivery by the Parent
Entities, constitutes its valid and binding agreement, enforceable against it in accordance with its terms, subject to the Enforceability Exceptions.
(d) The execution and delivery of and performance under, this letter agreement by it do not and will not (i) violate its organizational
documents, (ii) violate any provision of applicable Law or (iii) conflict with any Contract binding upon it, except in the case of (ii) and (iii) as would not reasonably be expected to, individually or in the aggregate, materially
affect its ability to enter into this letter agreement or timely perform its obligations hereunder.
4
(e) All authorizations, consents, Orders, approvals, licenses, permits, expirations or
terminations of waiting periods, and waivers of, and all notices, reports and other filings to, all Governmental Authorities that may be or become necessary for the due execution, delivery and performance of this letter by such Equity Investor have
been obtained or made and all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with, any Governmental Authority is required in connection with the execution, delivery or performance of this letter
except as would not reasonably be expected to, individually or in the aggregate, materially affect such Equity Investors ability to enter into this letter or timely perform its obligations hereunder.
(f) From the date hereof until the termination of this letter agreement in accordance with Section 2 hereof, such
Equity Investor has, and until such time will maintain, uncalled capital commitments or unrestricted funds on hand in an amount not less than the its Respective Proportion of the Equity Financing Commitment plus the aggregate amount of all other
unfunded contractually binding commitments of such Equity Investor then outstanding.
(g) Such Equity Investors Respective
Proportion of the Equity Financing Commitment is less than the maximum amount that such Equity Investor is permitted to invest in any one portfolio investment pursuant to the terms of its organizational or governing documents.
4. Assignment; Amendments and Waivers; Entire Agreement.
(a) The rights and obligations under this letter agreement may not be assigned or delegated (whether by operation of law, merger,
consolidation or otherwise) by any party hereto without the prior written consent of the other parties and the Company (acting with the prior approval of the Special Committee) (and the Company shall be an express and intended third-party
beneficiary of this Section 4(a) and shall be entitled to grant such consent in its sole discretion), and any attempted assignment shall be null and void and of no force or effect. Notwithstanding the foregoing,
(i) the Parent Entities may assign, delegate or otherwise transfer all or a portion of their rights or obligations under this letter agreement to any assignee of the Parent Entities obligations under the Merger Agreement pursuant to an
assignment in accordance with Section 10.06 of the Merger Agreement, (ii) each Equity Investor may assign, delegate or otherwise transfer all or a portion of its obligation to fund the Equity Financing Commitment to one or more of its
Affiliated investment vehicles or any Person that is, directly or indirectly, wholly owned or otherwise controlled by or Affiliated with such Equity Investor or such Affiliated investment vehicles and (iii) each of SLP Fund VI, SLP Fund VII and
SLP SPV shall be entitled, in its sole discretion, to assign, delegate or otherwise transfer all or a portion of its obligation to fund its Respective Proportion of the Equity Financing Commitment to either or both of the other Equity Investors and,
upon any such assignment, delegation or transfer pursuant to this clause (iii), SLP Fund VI, SLP Fund VII or SLP SPV, as applicable, shall be irrevocably relieved of all such assigned, delegated or transferred obligations to fund its Respective
Proportion of the Equity Financing Commitment hereunder; provided that, (a) in each case of the foregoing clauses (i) and (ii), no such assignment, delegation or transfer shall relieve such Equity Investor of its obligations
5
hereunder, and (b) in each case of the foregoing clauses (i), (ii) and (iii), such assignment, delegation and/or transfer does not have the effect of preventing, impairing or delaying the
Transactions or the funding of the Equity Financing Commitment at the time set forth in Section 1. Following any valid assignment, delegation or transfer by an Equity Investor of its obligations hereunder pursuant to the
second sentence of this Section 4(a), such Equity Investor will provide the Parent Entities and the Company Entities written notice of such assignment, delegation or transfer. Upon any such assignment, delegation or
transfer by an Equity Investor of its obligations hereunder pursuant to the second sentence of this Section 4(a), such assignee, delegate or transferee shall be deemed to have given the representations and warranties set forth in Section 3
of this letter agreement as of the time of such assignment, delegation or transfer. Any assignment, delegation or transfer in breach of Section 3 (in respect of the representations and warranties deemed to be made as of the
time of such assignment, delegation or transfer) or in violation of this Section 4(a) shall be null and void and of no force and effect. As used herein, the term Affiliated shall have the correlative meaning of
Affiliate as defined in the Merger Agreement.
(b) This letter agreement may not be amended, and no provision hereof waived or
modified, except by an instrument duly executed by each of the parties hereto and the Company (acting with the prior approval of the Special Committee) (and the Company shall be an express and intended third-party beneficiary of this
Section 4(b) and shall be entitled to grant such consent in its sole discretion). The failure of any party or third-party beneficiary to assert any of its rights under this letter agreement or otherwise shall not constitute
a waiver of those rights.
(c) This letter agreement, including Schedule A attached hereto, the Guarantee and the Merger Agreement
constitute the entire agreement among the parties with respect to the subject matter hereof and thereof and supersedes all prior agreements and undertakings, both written and oral, between the Equity Investors or any of their Affiliates, on the one
hand, and the Parent Entities or any of their Affiliates, on the other hand, with respect to the subject matter hereof and thereof.
5.
Parties in Interest. Except to the extent set forth in Section 4(a), Section 4(b) and Section 6(b), this letter agreement shall be binding upon and inure solely to
the benefit of each party hereto and their respective successors and permitted assigns, and nothing in this letter agreement, express or implied, is intended to or shall confer upon any other Person any right, benefit or remedy of any nature
whatsoever under or by reason of this letter agreement, or any rights to enforce or cause the Parent Entities to enforce, the Equity Financing Commitment or any provisions of this letter agreement; provided, however that the Parent
Related Parties are express, intended third party beneficiaries of Section 6(a) hereto.
6. Limited Recourse;
Enforcement.
(a) Notwithstanding anything that may be expressed or implied in this letter agreement, the Guarantee, the Merger
Agreement or any document or instrument delivered in connection herewith or therewith, the Parent Entities, by their acceptance of the benefits of the Equity Financing Commitment provided herein, covenant, agree and acknowledge that no Person other
than the Equity Investors (and their successors and permitted assigns) shall have any obligations hereunder and that, notwithstanding that each Equity Investor or any of its permitted
6
assigns may be a partnership or limited liability company, no Person has any rights of recovery against, and no recourse hereunder or under any documents or instruments delivered in connection
herewith or in respect of any oral representations made or alleged to have been made in connection herewith or therewith shall be had against, any of the Parent Entities, the Merger Subs, the Equity Investors or any of their or
their respective Affiliates respective former, current or future directors, officers, employees, direct or indirect holders of any equity, stockholders, controlling persons, attorneys, members, managers, general or limited partners, assignees
(other than a permitted assignee hereunder), agents, representatives or representatives of any of the foregoing (other than, in each applicable case, the Parent Entities, the Merger Subs and the Equity Investors and their respective successors and
permitted assigns, a Parent Related Party and together, the Parent Related Parties), whether by or through attempted piercing of the corporate (or limited liability company or limited partnership) veil, by or
through a claim (whether at law or equity or in tort, contract or otherwise) by or on behalf of the Equity Investor against any Parent Related Party, by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any
applicable Law, or otherwise, it being agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any Parent Related Party for any obligations of any Equity Investor or any of its
successors or permitted assigns under this letter agreement, the Merger Agreement or under any documents or instruments delivered in connection herewith or therewith in respect of any transaction contemplated hereby or in respect of any oral
representations made or alleged to have been made in connection herewith or for any claim (whether at law or equity or in tort, contract or otherwise) based on, in respect of, or by reason of such obligations or their creation; provided,
however, that notwithstanding anything to the contrary provided herein or any document or instrument delivered in connection herewith, nothing herein (including this Section 6) shall limit the Non-Prohibited Claims or the third-party beneficiary rights made expressly available to the Company hereunder.
(b) Subject to the proviso in Section 5, this letter agreement may only be enforced by the Parent Entities, and none
of the Parent Entities creditors nor any other Person that is not a party to this letter agreement shall have any right to enforce this letter agreement or to cause the Parent Entities to enforce this letter agreement; provided,
however, that the Company is hereby made an express and intended third party beneficiary of the rights granted to the Parent Entities under this letter agreement (which third party beneficiary rights the Special Committee shall be
entitled to enforce) only for the purpose of seeking (and, if applicable, obtaining) specific performance or injunction(s) (A) to cause the Equity Investors (or their respective successors or permitted assigns), or to cause the Parent Entities
to cause the Equity Investors (or their respective successors or permitted assigns), to comply with the terms of this letter agreement, including to satisfy the Equity Investors obligation to fund the Equity Financing Commitment hereunder
(subject to the limitations set forth in this letter agreement, including Section 1 of this letter agreement), in each case subject to the conditions of the Merger Agreement, including the conditions set forth in
Section 10.08(a) of the Merger Agreement (solely to the extent that the Parent Entities can enforce the Equity Financing Commitment pursuant to the terms hereof), and for no other purpose (including, without limitation, any claim for monetary
damages hereunder or under the Merger Agreement) and (B) with respect to its express rights to notice of or consent pursuant to Sections 4(a) and 4(b). The Equity Investor acknowledges and agrees that (I) the Parent Entities
are delivering a copy of this letter agreement to the Company and that the Company is relying on the third-party beneficiary rights, representations, warranties, obligations and
7
commitments of the Equity Investor hereunder in connection with the Companys decision to enter into the Merger Agreement and consummate the Transactions, and (II) the enforcement
rights under this Section 6(b) (subject to the requirements and limitations herein and in the Merger Agreement) are an integral part of the Transactions and without those rights, the Company would not have entered into the
Merger Agreement.
(c) Concurrently with the execution and delivery of this letter agreement, the Equity Investors are executing and
delivering to OpCo the Guarantee relating to certain of the Parent Entities and the Merger Subs obligations under the Merger Agreement. Except as expressly set forth in Section 4(a),
Section 4(b) and Section 6(b) hereof or in the Confidentiality Agreement, the Companys remedies against the Equity Investors under this letter agreement and under the Guarantee are intended
to be the sole and exclusive direct or indirect remedies available to the Company Related Parties against the Equity Investors or any Parent Related Party for any liability, loss, damage or recovery of any kind in connection with, relating to,
arising out of or resulting from any breach of the Merger Agreement, the failure of the Transactions to be consummated for any reason or otherwise in connection with the transactions contemplated hereby and thereby or in respect of any
representations made or alleged to have been made in connection therewith, whether in equity or at law, in contract, in tort or otherwise (whether or not a Parent Entitys or a Merger Subs breach is caused by the breach by the Equity
Investor of its obligations under this letter agreement) and neither the Equity Investors nor any Parent Related Party shall have any further liability or obligation relating to or arising out of such matters; provided, however, that
nothing herein (including this Section 6) shall limit the Non-Prohibited Claims, the third-party beneficiary rights made expressly available to the Company hereunder or the remedies
available to the Company Entities under the Rollover Agreement or the Voting Agreement.
7. Confidentiality. This letter agreement
shall be treated as confidential and is being provided to the Parent Entities solely in connection with the Merger Agreement. This letter agreement may not be used, circulated, quoted or otherwise referred to in any document, except with the written
consent of the Equity Investor; provided that no such written consent shall be required for disclosures by the Parent Entities to the Company Entities (or their respective Representatives) so long as the Company Entities agree to (and to
cause their respective Representatives to) keep such information confidential on terms substantially identical to the terms contained in this Section 7; provided, further, that any party hereto may
disclose the existence of this letter agreement to the extent required by any applicable Law, the applicable rules of any national securities exchange, in connection with any securities regulatory agency filings relating to the transactions
contemplated by the Merger Agreement, or in connection with the enforcement of any such partys rights hereunder or under the Guarantee or the Merger Agreement.
8. Governing Law; Jurisdiction; Waiver of Jury Trial.
(a) This letter agreement shall be governed by and construed in accordance with the Laws of the State of Delaware without regard to the
principles of conflicts of law that would cause the application of law of any jurisdiction other than those of the State of Delaware.
8
(b) The parties hereto agree that any Action seeking to enforce any provision of, or based
on any matter arising out of or in connection with, this letter agreement or the transactions contemplated hereby (whether brought by any party or any of its Affiliates or against any party or any of its Affiliates) shall be heard and determined
exclusively in the Court of Chancery of the State of Delaware; provided, however, that, if such court does not have jurisdiction over such Action, such Action shall be heard and determined exclusively in any federal or state court
located in the State of Delaware. Consistent with the preceding sentence, each of the parties hereto hereby (i) submits to the exclusive jurisdiction of any federal or state court sitting in the State of Delaware for the purpose of any Action
arising out of or relating to this letter agreement brought by either party hereto, (ii) agrees that service of process will be validly effected by sending notice in accordance with Section 10.02 of the Merger
Agreement and (iii) irrevocably waives, and agrees not to assert by way of motion, defense, or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is
exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this letter agreement or the transactions contemplated hereby may not be enforced in or by any of
the above named courts.
(c) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LETTER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES HERETO
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS LETTER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS LETTER AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8(c).
9. Headings. The descriptive headings herein are inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this letter agreement. When a reference is made in this letter agreement to a Section, such reference shall be to a Section of this letter agreement unless otherwise indicated.
10. Counterparts. This letter agreement may be executed and delivered (including by facsimile transmission or other means of electronic
transmission, such as by electronic mail in pdf form) in counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall
constitute one and the same letter agreement.
[Remainder of this page intentionally left blank.]
9
|
|
|
Very truly yours, |
|
Equity Investor: |
|
SILVER LAKE PARTNERS VI, L.P. |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VI, L.P., its general partner |
|
|
By: |
|
SLTA VI (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
|
|
Name: Egon Durban |
|
|
Title: Co-CEO |
|
SILVER LAKE PARTNERS VII, L.P. |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its general partner |
|
|
By: |
|
SLTA VII (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
|
|
Name: Egon Durban |
|
|
Title: Co-CEO |
|
SL SPV-4, L.P. |
|
|
By: |
|
SLTA SPV-4, L.P., its general partner |
|
|
By: |
|
SLTA SPV-4 (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
|
|
Name: Egon Durban |
|
|
Title: Co-CEO |
[Equity Commitment
Letter]
|
|
|
Accepted and acknowledged: |
|
WILDCAT EGH HOLDCO, L.P. |
|
|
By: |
|
SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
|
By: |
|
SLTA VII (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
|
|
Name: Egon Durban |
|
|
Title: Co-CEO |
|
WILDCAT OPCO HOLDCO, L.P. |
|
|
By: |
|
SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
|
By: |
|
SLTA VII (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
|
|
Name: Egon Durban |
|
|
Title: Co-CEO |
[Equity Commitment
Letter]
Schedule A
Proportions
|
|
|
|
|
Equity Investor |
|
Respective Proportion |
|
Silver Lake Partners VI, L.P. |
|
|
12.62910 |
% |
Silver Lake Partners VII, L.P. |
|
|
70.12125 |
% |
SL SPV-4, L.P. |
|
|
17.24965 |
% |
|
|
|
|
|
Aggregate Proportion |
|
|
100.00 |
% |
|
|
|
|
|
[Equity Commitment
Letter]
Exhibit (B)(2)
CONFIDENTIAL
DFO
Private Investments, L.P.
One Vanderbilt, 26th Floor
New York, New York 10017
Thirty
Fifth Investment Company L.L.C.
Al Mamoura Building A, 5th Floor, Muroor Road and 15th Street
P.O. Box 45005, Abu Dhabi, UAE
April 2, 2024
WILDCAT EGH HOLDCO, L.P.
c/o
Silver Lake Partners
55 Hudson Yards
550 West 34th Street, 40th Floor
New York, NY 10001
Attention: Egon Durban
Project Wildcat
Preferred Equity Commitment Letter
Ladies and Gentlemen:
This letter (together
with the exhibits hereto, this Commitment Letter) sets forth the commitment of DFO Private Investments, L.P., a Delaware limited partnership (DFO), and Thirty Fifth Investment Company L.L.C., a limited liability
company incorporated in the Abu Dhabi Global Market (Mubadala and, together with DFO, we, us or the Purchasers), subject to the terms and conditions contained herein, to
provide or cause to be provided to Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (Buyer or you), all or a portion of the Preferred Financing to consummate the
Transactions described in the Transaction Description attached hereto as Exhibit A (the Transaction Description). As used herein, the Preferred Financing shall mean $500,000,000 (subject to increase as
set forth below) of aggregate preferred equity financing that will be used to consummate such Transactions. Capitalized terms used but not defined in this Commitment Letter shall have the meanings set forth in the Exhibits to this Commitment Letter.
1. |
Commitments. (x) Each of DFO and Mubadala hereby commits, severally and not jointly, subject to the
terms and conditions set forth herein, that, at (and subject to) the closing of the Acquisition (Closing), it shall provide or shall cause to be provided to Buyer, in exchange for a preferred equity interest in Endeavor Group
Holdings, Inc. (Issuer), to be issued on the terms set forth on Exhibit B, for an amount equal to $300,000,000 and $200,000,000, respectively, of the Preferred Financing (the Commitments), which
Commitment in respect of each of the Purchasers may be increased, at such Purchasers option (such option to be exercised within 10 business days of the receipt of written notice from you of a Ratings Event (as defined below)), in the event
that the Issuer has obtained a credit rating or an advisory or prospective credit rating from Moodys Investor Service, Inc. and S&P Global |
|
Ratings Inc. of B1 (or better) or B+ (or better), respectively (such event, a Ratings Event), which ratings give effect to any such increased Commitments, with the aggregate
increase of such Commitments not to exceed the lesser of (A) $100,000,000 and (B) the maximum amount of incremental Preferred Financing that may be issued by the Issuer that would still result in the occurrence of the Ratings Event, with such
aggregate increase to be allocated 50.0% to DFO and 50.0% to Mubadala, and with any amount of increased Commitments that are declined to be provided by a Purchaser to be offered to any other non-declining
Purchaser and (y) the Issuer hereby agrees, subject to the terms and conditions set forth herein, at (and subject to) the Closing, to issue the Preferred Equity, on the terms set forth in Exhibit B, to the Purchasers in accordance with
their respective Commitments hereunder. Notwithstanding anything to the contrary contained in this Commitment Letter or any other letter agreement or undertaking concerning the Transactions to the contrary, each Purchaser shall be permitted to sell,
resell, reallocate, assign or transfer all or any portion of any of their Commitments to purchase any of the Preferred Equity hereunder or the Closing Payment to (i) in the case of DFO, any affiliate of DFO, the Michael & Susan Dell
Foundation, and/or an entity managed by DFO, BDT & MSD Holdings, L.P. or their respective affiliates, and (ii) in the case of Mubadala, to one or more Affiliates or one or more members of the Abu Dhabi Group, excluding, in each case,
any portfolio company of Mubadala, its Affiliates or any member of the Abu Dhabi Group (for purposes of this letter agreement, (I) an Affiliate of Mubadala means any person Controlled, directly or indirectly, by a member of
the Mubadala Group and which has substantially the same (i.e., not partially overlapping, but rather the same) ultimate beneficial ownership as Mubadala as of the date hereof (other than beneficial interests issued to current or former employees of
Mubadala Group), where (1) Mubadala Group means Mubadala Investment Company PJSC, MDC Capital Management LLC, a United Arab Emirates limited liability company, together with its direct and indirect controlled subsidiaries, and
each of their respective Affiliates, and (2) Control (including the terms Controlled by and under common Control with) means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a non-natural person, whether through the ownership of voting securities, by contract or otherwise; provided that for the avoidance of doubt and without
limiting the foregoing, a person shall be deemed to be Controlled by the Mubadala Group if an entity in the Mubadala Group (a) has the right directly or indirectly to direct (by positive or negative action) material decisions by such person
with respect to the assets of such person or (b) acts as such persons investment adviser or investment manager), and (II) Abu Dhabi Group means any person directly or indirectly Controlled by the Government of Abu
Dhabi, including for the avoidance of doubt any third-party fund where the general partner, manager, or investment advisor of such fund is directly or indirectly Controlled by the Government of Abu Dhabi, including but not limited to Lunate);
provided that no such sale, resale, reallocation, assignment or transfer shall reduce or release such Purchaser from its respective applicable Commitment until the actual purchase and sale of the Preferred Equity on the date of the consummation of
the Acquisition by the relevant buyer, assignee or transferee. |
2. |
Information. You hereby represent and warrant that (a) all written information and written data
(such information and data, other than (i) estimates, forecasts and other projections (the Projections) and (ii) information of a general economic or industry specific nature, the Information) (in the
case of Information regarding the Target and its subsidiaries and its and their respective businesses, to the best of your knowledge), that has been or will be made |
2
|
available to the Purchasers directly or indirectly by you, the Target or by any of your or its subsidiaries or representatives, in each case, on your behalf in connection with the transactions
contemplated hereby, when taken as a whole and together with the reports and other information filed by the Target or any of its subsidiaries with the Securities and Exchange Commission (including the risk factors therein), is or will be, when
furnished, correct in all material respects and does not or will not, when furnished and when taken as a whole, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained
therein not materially misleading in light of the circumstances under which such statements are made (after giving effect to all supplements and updates thereto from time to time) and (b) the Projections that have been or will be made available
to the Purchasers by you or by any of your subsidiaries or representatives, in each case, on your behalf in connection with the transactions contemplated hereby have been, or will be, prepared in good faith based upon assumptions that are believed
by you to be reasonable at the time prepared and at the time the related Projections are so furnished to the Purchasers; it being understood that the Projections are as to future events and are not to be viewed as facts, the Projections are subject
to significant uncertainties and contingencies, many of which are beyond your control, that no assurance can be given that any particular Projections will be realized and that actual results during the period or periods covered by any such
Projections may differ significantly from the projected results and such differences may be material. You agree that, if at any time prior to the closing of the Acquisition and the funding of the Preferred Financing (the Closing
Date), you become aware that any of the representations and warranties in the preceding sentence would be incorrect in any material respect if the Information and the Projections were being furnished, and such representations and
warranties were being made, at such time, then you will (or, with respect to the Information and Projections relating to the Target and its subsidiaries, will use commercially reasonable efforts to) promptly supplement the Information and the
Projections such that such representations and warranties are correct in all material respects under those circumstances (or, in the case of the Information relating to the Target and its subsidiaries and its and their respective businesses, to the
best of your knowledge, such representations and warranties are correct in all material respects under those circumstances). |
3. |
Closing Payments; Alternative Transaction Fee; Expenses. As consideration for the Commitments hereunder,
Issuer agrees, (x) if and only if the Closing of the portion of the Preferred Financing for which a Purchaser has provided Commitments and the Transactions occurs, to pay, or cause to be paid, to such Purchaser a
non-refundable closing payment as set forth on Annex I (the Closing Payment), which such Purchaser may elect to net fund, (y) if and only if the Closing of the Acquisition by Buyer,
Silver Lake or any one or more of their affiliates occurs, and the Preferred Financing allocated to a particular Purchaser is not funded as a result of a failure of a condition to such Purchasers Commitments hereunder to be satisfied (provided
such Purchaser is not then in breach of this Commitment Letter so as to cause any of the conditions to such Purchasers Commitments hereunder not to be satisfied (or to be incapable of fulfillment)), to pay, or cause to be paid, to such
Purchaser a non-refundable alternate transaction fee as set forth on Annex I (assuming all such Commitments were funded), which the Issuer and such Purchaser agree constitutes liquidated damages payable to
compensate such Purchaser for the lost investment opportunity, and (z) if the Closing of any portion of the Preferred Financing and the Transactions occurs, to reimburse |
3
|
the Purchasers on the Closing Date for any and all out-of-pocket expenses and the fees and documented disbursements
of legal counsel to the Purchasers, incurred in connection with transactions contemplated hereby through the Closing Date, subject to an aggregate cap of $500,000 (which such amount may be allocated amongst the Purchasers in their discretion and as
they may agree). |
4. |
Conditions. The Commitments of each Purchaser hereunder shall be subject solely to conditions expressly
set forth in Exhibit C to this Commitment Letter (the Funding Conditions), and upon satisfaction (or waiver by such Purchaser in accordance with this Commitment Letter) of such conditions, the initial funding of the
Commitment of such Purchaser shall occur; it being understood that there are no conditions (implied or otherwise) to the commitments hereunder, including compliance with the terms of this Commitment Letter other than the Funding Conditions that are
expressly stated to be conditions to the issuance and sale of the Preferred Equity on the Closing Date. |
Notwithstanding
anything to the contrary in this Commitment Letter (including each of the Exhibits attached hereto) or any other letter agreement or other undertaking concerning the financing of the Transactions to the contrary, (i) the only representations
and warranties relating to you or the Target or your or their respective subsidiaries or businesses or otherwise, the accuracy of which shall be a condition to the funding of the Preferred Financing on the Closing Date shall be (a) such of the
representations and warranties (if any) made by, or with respect to, the Target and its subsidiaries in the Acquisition Agreement as are material to the interests of the Purchasers in their capacities as such, but only to the extent that you (or
your affiliate) have the right (taking into account any applicable notice and cure provisions) to terminate your (and/or its) obligations under the Acquisition Agreement or decline to consummate the Acquisition or otherwise results in a failure of a
condition precedent in the Acquisition Agreement (in each case, in accordance with the terms thereof) as a result of a breach of such representations and warranties in the Acquisition Agreement (to such extent, the Specified Acquisition
Agreement Representations) and (b) the Specified Representations (as defined below) made by the Issuer in the Preferred Equity Documentation, and (ii) the terms of the Preferred Equity Documentation and the Closing Deliverables
(as defined in Exhibit C to this Commitment Letter) shall be in a form such that they do not impair the issuance of the Preferred Equity on the Closing Date assuming the Funding Conditions are satisfied (or waived in writing by the Purchasers in
their sole discretion). For purposes hereof, Specified Representations means the applicable representations and warranties of Issuer to be set forth in the Preferred Equity Documentation relating to organizational corporate
existence of Issuer as of the Closing Date; tax status of the Issuer as a corporation; power and authority, due authorization, execution, delivery and enforceability, in each case, related to, the issuance of the Preferred Financing and performance
of the applicable definitive documentation related to the Preferred Financing; and the issuance of the Preferred Financing does not conflict with the organizational documents of Issuer; solvency as of the Closing Date (after giving effect to the
Transactions) of the Issuer and its subsidiaries on a consolidated basis (solvency to be defined in a manner consistent with the manner in which solvency is determined in the solvency certificate to be delivered in the form set forth in Annex II);
the Investment Company Act; the use of proceeds of the issuance and sale of the Preferred Financing not violating the PATRIOT Act (as defined below), OFAC or FCPA; valid issuance of the Preferred Equity and that the Preferred Equity is fully paid
and non-assessable; and status of the Preferred Equity as senior in payment priority and liquidation preference to all equity of the Issuer. This paragraph, and the provisions herein, shall be referred to as
the Limited Conditionality Provisions.
4
5. |
Limitation on Liability; Indemnity; Settlement. |
|
a. |
Limitation on Liability. |
Notwithstanding any other provision of this Commitment Letter, (i) no Indemnified Person or Related Indemnified Person shall be liable for
any damages arising from the use by others of information or other materials obtained through internet, electronic, telecommunications or other information transmission systems, except to the extent that such damages have resulted from the willful
misconduct, bad faith or gross negligence of such Indemnified Person or any Related Indemnified Person (as determined by a court of competent jurisdiction in a final and non-appealable decision) and
(ii) none of you (or any of your subsidiaries), the Investors (or any of their respective affiliates), the Target (or any of its subsidiaries or affiliates), any Indemnified Person or any Related Indemnified Person shall be liable for any
indirect, special, punitive or consequential damages (including, without limitation, any loss of profits, business or anticipated savings) in connection with this Commitment Letter, the Transactions (including the Preferred Financing and the use of
proceeds thereunder), or with respect to any activities related to the Preferred Financing, including the preparation of this Commitment Letter and the definitive documentation of the Preferred Financing; provided that nothing in this paragraph
shall limit your indemnity and reimbursement obligations to the extent that such indirect, special, punitive or consequential damages are included in any claim by a third party with respect to which the applicable Indemnified Person is entitled to
indemnification under subsection (b) of this Section 5.
To induce the Purchasers to enter into this Commitment Letter and to proceed with the definitive documentation of the Preferred Financing, you
agree to indemnify and hold harmless the Purchasers, their respective affiliates and their and their respective affiliates officers, directors, employees, agents, partners, owners, controlling persons, advisors, attorneys and other
representatives of each of the foregoing and their successors and permitted assigns under this Commitment Letter (each, an Indemnified Person), from and against any and all losses, claims, damages and liabilities of any kind or
nature and reasonable and documented or invoiced out-of-pocket fees and expenses, joint or several, to which any such Indemnified Person may become subject to the extent
arising out of, resulting from, or in connection with any actual or threatened claim, litigation, investigation or proceeding (including any inquiry or investigation) in connection with this Commitment Letter (including
Exhibit B hereto (the Term Sheet)), the Transactions or any related transaction contemplated hereby or thereby, the Preferred Financing or any use of the proceeds thereof (any of the
foregoing, a Proceeding), regardless of whether any such Indemnified Person is a party thereto, whether or not such Proceedings are brought by you, your equity holders, affiliates or creditors or any other third person, and to
promptly reimburse after receipt of a written request, each such
5
Indemnified Person for any reasonable and documented or invoiced out-of-pocket legal fees and expenses incurred in
connection with investigating or defending any of the foregoing by one firm of counsel for all such Indemnified Persons, taken as a whole and, if necessary, by a single firm of local counsel in each appropriate jurisdiction (which may include a
single firm of special counsel acting in multiple jurisdictions) for all such Indemnified Persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Person affected by such conflict notifies you
of the existence of such conflict and thereafter retains its own counsel, by another firm of counsel for such affected Indemnified Person) or other reasonable and documented or invoiced
out-of-pocket fees and expenses incurred in connection with investigating, responding to, or defending any of the foregoing; provided that the foregoing indemnity
will not, as to any Indemnified Person, apply to losses, claims, damages, liabilities or related expenses to the extent that they have resulted from (i) the willful misconduct, bad faith or gross negligence of such Indemnified Person or any
Related Indemnified Person (as defined below) (as determined by a court of competent jurisdiction in a final and non-appealable decision), (ii) a material breach of the obligations of such Indemnified Person
or any Related Indemnified Person under this Commitment Letter (as determined by a court of competent jurisdiction in a final and non-appealable decision) or (iii) any Proceeding solely between or among
Indemnified Persons not arising from any act or omission by you or any of your affiliates. The foregoing provisions in this paragraph shall be superseded, in each case, to the extent covered thereby by the applicable provisions contained in the
definitive documentation of the Preferred Financing upon execution and delivery thereof and thereafter shall have no further force and effect.
Related Indemnified Person of an Indemnified Person means (1) any controlling person or any affiliate of such
Indemnified Person, (2) the respective directors, officers, or employees of such Indemnified Person or any of its controlling persons or any of its affiliates and (3) the respective agents, advisors, attorneys and representatives of such
Indemnified Person or any of its controlling persons or any of its affiliates, in the case of this clause (3), acting at the instructions of such Indemnified Person, controlling person or such affiliate (it being understood and agreed that any
agent, advisor or representative of such Indemnified Person or any of its controlling persons or any of its affiliates engaged to represent or otherwise advise such Indemnified Person, controlling person or affiliate in connection with the
Transactions shall be deemed to be acting at the instruction of such person).
You shall not be liable for any settlement of any Proceeding effected without your written consent (which consent shall not be unreasonably
withheld, conditioned or delayed), but if settled with your written consent or if there is a final and non-appealable judgment by a court of competent jurisdiction in any such Proceeding, you agree to
indemnify and hold harmless each Indemnified Person from and against any and all losses, claims, damages, liabilities and reasonable and documented legal or other
out-of-pocket expenses by reason of such settlement or judgment in accordance with and to the extent provided in the other provisions of this Section 5. It is
further agreed that the Purchasers shall be severally liable in respect of their Commitments, on a several, and not joint basis with any other Purchaser.
6
You shall not, without the prior written consent of any Indemnified Person (which consent
shall not be unreasonably withheld, conditioned or delayed) (it being understood that the withholding of consent due to non-satisfaction of any of the conditions described in clauses (i), (ii) and
(iii) of this sentence shall be deemed reasonable), effect any settlement of any pending or threatened Proceedings in respect of which indemnity could have been sought hereunder by such Indemnified Person unless such settlement
(i) includes an unconditional release of such Indemnified Person in form and substance reasonably satisfactory to such Indemnified Person from all liability or claims that are the subject matter of such proceedings, (ii) does not include
any statement as to or any admission of fault, culpability, wrong doing or a failure to act by or on behalf of any Indemnified Person and (iii) contains customary confidentiality provisions with respect to the terms of such settlement. Each
Indemnified Person shall be severally obligated to refund or return any and all amounts paid by you under this Section 5 to the extent such Indemnified Person is not entitled to payment of such amounts in accordance with the terms hereof (as
determined by a court of competent jurisdiction in a final and non-appealable judgment).
6. |
Confidentiality. You agree that you will not disclose, directly or indirectly, prior to your acceptance
hereof, this Commitment Letter, the Term Sheet, the other exhibits and attachments hereto or the contents of each thereof, or the activities of any Purchaser pursuant hereto or thereto, to any person or entity without the prior written approval of
the Purchasers (such approval not to be unreasonably withheld, delayed or conditioned), except (a) to the Investors (as defined in Exhibit A) and to any of your or the Investors affiliates and your and their respective officers,
directors, employees, agents, attorneys, accountants, advisors, controlling persons and equity holders and to actual and potential co-investors who are informed of the confidential nature thereof, on a
confidential and need-to-know basis, (b) if the Purchasers consent in writing to such proposed disclosure or (c) pursuant to an order of any court or
administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal process or to the extent requested or required by governmental and/or regulatory
authorities, in each case based on the reasonable advice of your legal counsel (in which case you agree, to the extent practicable and not prohibited by applicable law, rule or regulation, to inform us promptly thereof prior to disclosure); provided
that (i) you may disclose this Commitment Letter and the contents hereof (other than with respect to Section 3 hereof and information with respect to fees, compensation or discounts within the Term Sheet) to the Target, its subsidiaries
and affiliates and its and their respective officers, directors, employees, agents, attorneys, accountants, advisors and controlling persons, on a confidential and
need-to-know basis, (ii) you may disclose the Commitment Letter and its contents (including the Term Sheet and other exhibits and attachments hereto) (but not the
contents of Section 3 hereof or information with respect to fees, compensation or discounts within the Term Sheet) in any syndication or other marketing materials in connection with the Credit Facilities (as defined in Exhibit A) and
Margin Bridge Facility (as defined in Exhibit A) (including any marketing materials and information memorandum used in connection therewith), (iii) you may disclose the aggregate fee amounts contained in this Commitment
|
7
|
Letter as part of Projections, pro forma information or a generic disclosure of aggregate sources and uses related to fee amounts related to the Transactions to the extent customary or required
in any marketing materials or in connection with the Credit Facilities or in connection with any public or regulatory filing requirement relating to the Transactions (and then only to the extent aggregate with all other fees and expenses of the
Transactions and not presented as an individual line item unless required by applicable law, rule or regulation), (iii) you may disclose the Term Sheet and other exhibits and attachments to the Commitment Letter, and the contents thereof, to
potential co-investors and to rating agencies in connection with obtaining public ratings for the Borrower (as defined in Exhibit A) and the Credit Facilities, (iv) you may disclose this Commitment
Letter and the contents thereof (including the Term Sheet and other exhibits and attachments hereto) to the initial lenders and any prospective lenders under the Credit Facilities and Margin Bridge Facility, the custodian and the transfer agent in
connection with the Margin Loan facility, any additional prospective investor in the Preferred Financing and to any such persons affiliates and their respective officers, directors, employees, agents, attorneys, accountants and other advisors,
on a confidential and need-to-know basis and (v) in connection with any remedy or enforcement of any right hereunder. |
Each Purchaser and its affiliates will use all non-public information provided to any of them or such
affiliates by or on behalf of you hereunder or in connection with the Acquisition and the related Transactions solely for the purpose of negotiating, evaluating and consummating the transactions contemplated hereby and shall treat confidentially all
such information and shall not publish, disclose or otherwise divulge, such information; provided that nothing herein shall prevent such Purchaser and its affiliates from disclosing any such information (a) pursuant to the order of any
court or administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal process based on the reasonable advice of counsel (in which case such
Purchaser agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory authority or governmental regulatory authority exercising examination or regulatory authority), to the extent practicable and not
prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (b) upon the request or demand of any regulatory authority having jurisdiction, or purporting to have jurisdiction, over such Purchaser or any of
its affiliates (in which case the Purchasers agree (except with respect to any audit or examination conducted by bank accountants or any self-regulatory authority or governmental regulatory authority exercising examination or regulatory authority),
to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (c) to the extent that such information becomes publicly available other than by reason of improper disclosure
by such Purchaser or any of its Related Parties (as defined below) in violation of any confidentiality obligations owing to you, the Investors, Issuer, the Target or any of your or their respective subsidiaries and affiliates, (d) to the extent
that such information is or was received by such Purchaser or any of its Related Parties from a third party that is not, to such Purchasers knowledge, subject to contractual or fiduciary confidentiality obligations owing to you, the Investors,
Issuer, the Target or any of your or their respective subsidiaries and affiliates, (e) to the extent that such information is independently developed by such Purchaser or any of its Related Parties without the use of any confidential
information, (f) to such Purchasers affiliates and to its and their respective employees, officers, partners, directors, legal counsel,
8
independent auditors, rating agencies, professionals and other experts or agents and existing and prospective limited partners and financing sources who need to know such information in
connection with the Transactions and who are informed of the confidential nature of such information and who are subject to customary confidentiality obligations and who have been advised of their obligation to keep information of this type
confidential (collectively, the Related Parties), with such Purchaser, to the extent within its control, responsible for such persons compliance with this paragraph, (g) to the extent you consent in writing to any
specific disclosure or (h) to the extent such information was already in such Purchasers possession prior to any duty or other understanding of confidentiality entered into in connection with the Transactions. In the event that the
Preferred Financing is funded, each Purchasers and its respective affiliates, if any, obligations under this paragraph shall terminate automatically and be superseded by the confidentiality provisions in the definitive documentation of
the Preferred Financing upon the initial funding thereunder to the extent that such provisions are binding on such Purchaser.
Subject to
the immediately preceding sentence, the confidentiality provisions set forth in this Section 6 shall survive the termination of this Commitment Letter and expire and shall be of no further effect after the second anniversary of the date hereof.
7. |
Miscellaneous. This Commitment Letter and the commitments hereunder shall not be assignable by any party
hereto (other than (i) any assignment occurring as a matter of law pursuant to, or otherwise substantially simultaneously with, the Acquisition on the Closing Date, in each case to the Target, Merger Sub or the Issuer or (ii) by you to
(a) Target, Merger Sub or the Issuer substantially simultaneously with the Acquisition on the Closing Date or (b) a U.S. domestically organized entity, in each case, so long as such entity is, or will be, controlled by you or the Investors
after giving effect to the Transactions and shall (directly or indirectly through one or more wholly-owned subsidiaries) own the Target and the Issuer and agrees to be bound by the terms hereof) without the prior written consent of each other party
hereto (such consent not to be unreasonably withheld, conditioned or delayed) (and any attempted assignment without such consent shall be null and void). This Commitment Letter and the commitments hereunder are intended to be solely for the benefit
of the parties hereto (and Indemnified Persons) and do not and are not intended to confer any benefits upon, or create any rights in favor of, any person other than the parties hereto (and Indemnified Persons to the extent expressly set forth
herein). The Purchasers reserve the right to employ the services of their respective affiliates or branches in providing services contemplated hereby and to allocate, in whole or in part, to their affiliates or branches certain fees payable to the
Purchasers in such manner the Purchasers and their affiliates or branches may agree in their sole discretion, and, to the extent so employed, such affiliates and branches shall be entitled to the benefits and protections afforded to, and subject to
the provisions governing the conduct of the Purchasers hereunder. This Commitment Letter may not be amended or any provision hereof waived or modified except by an instrument in writing signed by each of the Purchasers and you. This Commitment
Letter may be executed in any number of counterparts, each of which shall be deemed an original and all of which when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter
by facsimile transmission or other electronic transmission (i.e., a pdf or tif) shall be effective as delivery of a manually executed counterpart thereof. All Electronic Signatures (including, without limitation, facsimile or
..pdf) on or |
9
associated with any Communication shall be valid and binding on the applicable signatory to the same extent as a manual, original signature, and that any Communication entered into by Electronic
Signature, will constitute such signatorys legal, valid and binding obligation enforceable against such signatory in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered to the other
signatories. This Commitment Letter (including the exhibits hereto), together with any other letter agreement entered into with any of the Purchasers on or prior to the date hereof, (i) are the only agreements that have been entered into among
the parties hereto with respect to our commitments with respect to the Preferred Financing and (ii) supersede all prior understandings, whether written or oral, among us with respect to the Preferred Financing and sets forth the entire
understanding of the parties hereto with respect thereto. THIS COMMITMENT LETTER, AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER, OR RELATED TO, THIS COMMITMENT LETTER (INCLUDING, WITHOUT LIMITATION, ANY CLAIMS SOUNDING IN CONTRACT LAW OR TORT
LAW ARISING OUT OF THE SUBJECT MATTER HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; provided that, notwithstanding the foregoing, it is understood and agreed that (a) the interpretation of
the definition of Material Adverse Effect (as defined in the Acquisition Agreement) (and whether or not a Material Adverse Effect has occurred), (b) the determination of the accuracy of any Specified Acquisition Agreement Representation
and whether as a result of any inaccuracy thereof you (or your affiliate) have the right (taking into account any applicable cure provisions) to terminate your obligations under the Acquisition Agreement or decline to consummate the Acquisition and
(c) the determination of whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement, in each case shall be governed by, and construed in accordance with, the laws of the State of Delaware as applied
to the Acquisition Agreement, without regard to the principles of conflicts of law that would cause the application of law of any jurisdiction other than those of the State of Delaware.
Any Purchaser or its affiliates may, in consultation with you, place customary advertisements in financial and other newspapers and periodicals
or on a home page or similar place for dissemination of customary information on the Internet or worldwide web as it may choose, and circulate similar promotional materials, in each case, after the Closing Date, in the form of tombstone
or otherwise describing the name of the Issuer and the amount, type and closing date of the Transactions, all at the expense of such Purchaser or affiliate.
Each of the parties hereto agrees that this Commitment Letter is a binding and enforceable agreement with respect to the subject matter
contained herein, including an agreement to negotiate in good faith the Preferred Equity Documentation by the parties hereto in a manner consistent with this Commitment Letter, it being acknowledged and agreed that the commitments provided hereunder
are subject solely to conditions precedent as expressly provided herein.
EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER OR PROVIDING OF COMMITMENTS, AS THE CASE MAY BE, HEREUNDER.
10
Each of the parties hereto hereby irrevocably and unconditionally (a) submits, for
itself and its property, to the exclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York County in the State of New York, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Commitment Letter or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and agrees that all claims in respect of any such action or proceeding shall be
heard and determined in such New York State court or, to the extent permitted by law, in such Federal court, (b) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying
of venue of any suit, action or proceeding arising out of or relating to this Commitment Letter or the transactions contemplated hereby or thereby in any New York State or in any such Federal court, (c) waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and (d) agrees that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law. Each of the parties hereto agrees that service of process, summons, notice or document by registered mail addressed to you or us at the addresses set forth above shall be
effective service of process for any suit, action or proceeding brought in any such court.
We hereby notify you that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56) (signed into law October 26, 2001) (the PATRIOT Act) and the requirements of 31 C.F.R. § 1010.230 (the
Beneficial Ownership Regulation), each of the Purchasers may be required to obtain, verify and record information that identifies the Issuer and its subsidiaries, which information may include their names, addresses, tax
identification numbers and other information that will allow each of the Purchasers to identify the Issuer and its subsidiaries in accordance with the PATRIOT Act or the Beneficial Ownership Regulation, as applicable. This notice is given in
accordance with the requirements of the PATRIOT Act or the Beneficial Ownership Regulation, as applicable, and is effective for each of the Purchasers.
The survival, indemnification, compensation (if applicable), reimbursement (if applicable), jurisdiction, governing law, venue, waiver of jury
trial and confidentiality provisions contained herein shall remain in full force and effect regardless of whether the Preferred Financing shall have been issued and notwithstanding the termination or expiration of this Commitment Letter or the
Purchasers Commitments hereunder; provided that your obligations under this Commitment Letter shall automatically terminate and be superseded by the provisions of the definitive documentation relating to the Preferred Equity (to the extent
covered therein) upon the initial funding thereunder, and you shall automatically be released from all liability in connection therewith at such time. You may terminate this Commitment Letter and/or the Purchasers Commitments with respect to
the Preferred Financing (or any portion thereof) hereunder at any time subject to the provisions of the preceding sentence (any such commitment termination shall reduce the commitments of each Purchaser on a pro rata basis based on their respective
Commitments as of the date hereof).
Section headings used herein are for convenience of reference only and are not to affect the
construction of, or to be taken into consideration in interpreting, this Commitment Letter.
11
8. |
Each Purchaser represents that (i) it is an accredited investor within the meaning of
Regulation D, Rule 501(a), promulgated by the SEC under the Securities Act, as presently in effect and (ii) it is able to fend for itself, can bear the economic risk of its investment in the Preferred Financing, and has such knowledge and
experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Preferred Financing. |
9. |
Efforts. You agree that Mubadala shall not be required to provide any
non-public information with respect to itself or any of its affiliates except (i) such information that you reasonably determine is necessary to comply with any law, rule or regulation to which you and/or
Silver Lake may be subject, including, without limitation, anti-money laundering, CFIUS and/or tax laws, rules or regulations or changes to your policies or the policies of Silver Lake or its administrator designed to comply with such laws, rules or
regulations or (ii) to the extent that you and/or Silver Lake is subject to a governmental or regulatory investigation or inquiry that requires such information (in each case, Mubadala shall provide such information to you to the extent
(i) such information is available and (ii) Mubadala is not prohibited from providing such information based on the laws, regulations and public policies applicable to it; provided, that Mubadala shall use commercially reasonable efforts to
cooperate with you and Silver Lake in the provision of such information in a manner that will be compliant with such applicable law or regulation); provided, further, that Mubadala shall bear any fees, costs, fines or penalties resulting from its
failure to provide any information reasonably requested by you or Silver Lake. |
10. |
Effectiveness; Expiration. If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms of this Commitment Letter by returning to the Purchasers (or their legal counsel on behalf of the Purchasers), executed counterparts hereof not later than 11:59 p.m., New York City time, on April 3, 2024. The
Purchasers respective Commitments and obligations of the Purchasers hereunder will expire at such time in the event that the Purchasers (or their legal counsel) have not received such executed counterparts in accordance with the immediately
preceding sentence. If you do so execute and deliver to us this Commitment Letter at or prior to such time, we agree to hold our commitment to provide the Preferred Financing and our other undertakings in connection therewith available for you until
the earliest of (i) after execution and delivery of the Acquisition Agreement and prior to the consummation of the Transactions, the termination of the Acquisition Agreement by you (or your affiliate) or with your (or your affiliates)
written consent in accordance with its terms (other than with respect to provisions therein that expressly survive termination), (ii) the consummation of the Acquisition without the issuance by the Issuer of the Preferred Financing; and (ii)
11:59 p.m., New York City time on the date that is five business days after the Outside Date (as defined in and as may be extended pursuant to the Acquisition Agreement as in effect as of the date hereof) (such earliest time, the
Expiration Date). Upon the occurrence of any of the events referred to in the preceding sentence, this Commitment Letter and the commitments of the Purchasers hereunder shall automatically terminate unless the Purchasers shall, in
their sole discretion, agree to an extension in writing. The termination of any Commitment pursuant to this paragraph will not prejudice your rights and remedies in respect of any breach or repudiation of this Commitment Letter.
|
12
|
|
|
Sincerely, |
|
DFO PRIVATE INVESTMENTS, L.P. |
|
|
By: |
|
/s/ Marc R. Lisker |
Name: Marc R. Lisker |
Title: President |
|
Sincerely, |
|
THIRTY FIFTH INVESTMENT COMPANY L.L.C. |
|
|
By: |
|
/s/ Matthew Ryan |
Name: Matthew Ryan |
Title: Authorized Signatory |
|
|
By: |
|
/s/ Hani Barhoush |
Name: Hani Barhoush |
Title: Authorized Signatory |
[Signature Page to
Preferred Equity Commitment Letter]
|
|
|
Agreed and accepted as of the date first written above: |
|
WILDCAT EGH HOLDCO, L.P. |
|
|
By: |
|
SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
|
By: |
|
Silver Lake Technology Associates VII, L.P., its managing member |
|
|
By: |
|
SLTA VII (GP), L.L.C., its general partner |
|
|
By: |
|
Silver Lake Group, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: |
|
Egon Durban |
Title: |
|
Co-CEO |
[Signature Page to
Preferred Equity Commitment Letter]
Exhibit A
Project Wildcat
Transaction Description
Capitalized terms used but not defined in this Exhibit A shall have the meanings set forth in the other Exhibits to the Commitment
Letter to which this Exhibit A is attached (the Commitment Letter) or in the debt commitment letter dated as of the date hereof (the Debt Commitment Letter). In the case of any such capitalized term that
is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit A shall be determined by reference to the context in which it is used.
Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (Buyer or Holdco
Parent) and Wildcat OpCo Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (OpCo Parent), were formed at the direction of Silver Lake Partners and its affiliates (collectively, with
the funds partnerships, co-investment entities and other investment vehicles managed, advised or controlled thereby or by one or more directors thereof or under common control therewith, Silver
Lake or Sponsor). Pursuant to an Agreement and Plan of Merger, dated as of the date hereof (together with all exhibits, schedules and other disclosure letters thereto, collectively, as amended, the Acquisition
Agreement), by and among Holdco Parent, OpCo Parent, Wildcat PubCo Merger Sub, Inc., a corporation organized under the laws of the State of Delaware and wholly-owned subsidiary of Holdco Parent (Company Merger Sub),
Wildcat OpCo Merger Sub, L.L.C., a limited liability company organized under the laws of the State of Delaware and wholly-owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Company Merger Sub, the Merger
Subs and each, a Merger Sub and the Merger Subs, together with Holdco Parent and OpCo Parent, the Buyer Entities), a company previously identified to us and code-named Wildcat (the
Company or the Target), and a subsidiary of the Company (the OpCo and, together with the Company, the Company Entities and each, a Company Entity), (i)
Company Merger Sub will merge with and into the Target (the Company Merger), with the Target being the surviving entity of the Company Merger and (ii) OpCo Merger Sub will merge with and into the OpCo (the OpCo
Merger and, together with the Company Merger, the Mergers), with the OpCo being the surviving entity of the OpCo Merger, whereby (A) Holdco Parent will acquire, directly or indirectly, the equity interests of the
Company from the equity holders thereof (collectively, the Company Sellers) and, indirectly, the equity interests of OpCo owned by the Company and (B) OpCo Parent will acquire certain equity interests of the OpCo from the
equity holders thereof (collectively, the OpCo Sellers and, together with the Company Sellers, the Sellers). Other than certain Sellers who may be given the opportunity to retain, rollover or reinvest capital
stock, restricted stock units, profits interests and/or options into OpCo and/or the Company (including certain members of the management of the Company and its subsidiaries) (the Rollover Investors), the Sellers will receive cash
(the Acquisition Consideration) in exchange for their capital stock, restricted stock units, profits interests and/or options in the Company Entities. Immediately after giving effect to the Mergers and the other Transactions, the
Company will be a wholly-owned direct subsidiary of Holdco Parent and OpCo will be owned, collectively, directly or indirectly, by the Rollover Investors, Holdco Parent and OpCo Parent.
A-1
In connection with the foregoing, it is intended that:
|
a) |
The Issuer will issue to the Purchasers under that certain preferred equity commitment letter dated as of the
date hereof (the Preferred Equity Commitment Letter) newly issued shares of a class of preferred equity with an initial stated value of $1,000 per share (such shares the Preferred Equity) and in an aggregate
initial stated value of $500 million, which may be (x) increased by up to $100.0 million in certain circumstances as set forth in Section 1 of the Preferred Equity Commitment Letter and (y) further increased by up to
$150.0 million of additional preferred equity that is pari passu with the Preferred Equity (Additional Preferred Equity), so long as such Additional Preferred Equity is first offered to the Purchasers on a pro rata
basis based on their respective Commitments and with any declined amounts offered to accepting Purchasers (based on their pro rata share of such declined amounts) before such Additional Preferred Equity may be offered to third parties on terms no
more favorable to such third parties, taken as a whole, than what was offered to the Purchasers; provided that up to $150.0 million of Preferred Equity that is issued or proposed to be issued to one or more affiliates of Goldman Sachs
Asset Management, L.P. and/or funds, vehicles, clients or accounts that are managed, sponsored or advised by any of the foregoing (Goldman), which may only be offered to Goldman in the event of a Ratings Event, which ratings shall
give effect to any increase as set forth in foregoing clause (x) and any such proposed issuance to Goldman, shall not be subject to such right of first offer (it being understood, for the avoidance of doubt, that to the extent Goldman declines
such offer, then such declined amount shall continue to be subject to the right of first offer) (the Preferred Equity Issuance). |
|
b) |
The Sponsor and certain other investors (including certain Rollover Investors) arranged by and/or designated by
the Sponsor (collectively with the Sponsor, the Investors) will directly or indirectly make (X) cash equity contributions to the Buyer Entities (the foregoing cash equity contributions to the Buyer Entities, the
Common Equity Contribution and, together with the Preferred Equity Issuance, collectively the Equity Contribution), in an aggregate amount equal to, when combined with the fair market value of any capital stock
or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions (as defined below) and the proceeds of the Preferred Equity Issuance, at least 35.0% of the sum of (1) the aggregate gross
proceeds of the Facilities borrowed on the Closing Date, excluding the aggregate gross proceeds of (A) any Loans (as defined in the Debt Commitment Letter) to fund original issue discount and/or upfront fees in connection with the exercise of
the Market Flex Provisions under the Fee Letter (as defined in the Debt Commitment Letter) and (B) any Revolving Loans (as defined in the Debt Commitment Letter) to fund any working capital needs on the Closing Date and (2) the
equity capitalization of the Borrower and its subsidiaries on the Closing Date after giving effect to all of the Transactions (such sum of clauses (1) and (2), the Total Capitalization) and (Y) the Common Equity
Contribution, in an aggregate amount equal to, when combined with the fair market value of any capital stock or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions, at least 30.0% of
the Total Capitalization (the Minimum Common Equity Contribution); provided that, if applicable, to the extent any stockholder or other equity holder of the Target has
|
A-2
|
exercised appraisal rights in connection with the Transactions, then on the Closing Date the Investors may elect to issue one or more equity commitment letters and/or arrange for one or more
letters of credit to be issued on their behalf in an aggregate amount not less than the amount of consideration that would otherwise be paid under the Acquisition Agreement in respect of the shares or other equity interests subject to such appraisal
rights (the Appraisal Shares) and, for purposes of this Commitment Letter, an aggregate amount of such equity commitment letters and/or letters of credit up to, but not in excess of, the amount of consideration that would
otherwise be paid under the Acquisition Agreement in respect of the Appraisal Shares shall be included in the amount and percentage of the Equity Contribution from and after the Closing Date as if such amount was funded in cash (with it being
understood that, on or prior to the date of the final resolution of all such appraisal rights, the lesser of (a) the amount necessary to satisfy such appraisal rights in full and (b) an amount equal to the full amount committed under such
equity commitment letters and/or the face value of any such letters of credit shall be funded, directly or indirectly, in cash to a newly formed limited liability company organized under the laws of the United States or any state thereof and an
indirect subsidiary of the Target that is the borrower under the Revolving Facility and the Initial Term Facilities (the Borrower) in the form of common equity or preferred equity that ranks junior to the Preferred Equity or up to
$150.0 million (or $250.0 million, in the event that the Purchasers decline to increase their Commitments) of Additional Preferred Equity issued in accordance with paragraph (a) above); provided, further that, the Sponsor will control
a majority of the voting equity of the Issuer as of the Closing Date. |
|
c) |
The Borrower will obtain (i) up to $4,250 million under a senior secured term loan A- facility (the Initial Term A Facility) described in the Debt Commitment Letter, (ii) up to $2,750 million under a senior secured term loan B facility described in the Debt Commitment
Letter (the Initial Term B Facility), (iii) up to $250 million under a senior secured revolving credit facility described in the Debt Commitment Letter (the Revolving Facility) and (iv) a senior
secured 364-day term loan facility described in the Debt Commitment Letter (the Margin Bridge Facility and, collectively with the Initial Term A Facility and the Initial Term B Facility, the
Initial Term Facilities; the Initial Term Facilities and the Revolving Facility, collectively, the Credit Facilities) in an aggregate principal amount of up to (A) $1,500 million minus (B) the
aggregate principal amount of any loans funded under the Margin Bridge Facility on the Closing Date. |
|
d) |
The Margin Loan Borrower (as defined in the definitive documentation for the Margin Loan Facility) will seek to
obtain up to $1,500 million under a margin loan facility described in the Debt Commitment Letter (the Margin Loan Facility and, together with the Credit Facilities, the Facilities). |
|
e) |
All principal, accrued, but unpaid interest, fees and other amounts (other than contingent obligations not then
due and payable) outstanding on the Closing Date under the First Lien Credit Agreement, dated as of May 6, 2014 (as amended and restated by Amendment No. 5, dated as of May 18, 2018, and as further amended, supplemented or otherwise
modified from time to time, the Existing Wildcat Credit Agreement and, |
A-3
|
together with the Existing Tiger Credit Agreement, the Existing Credit Agreements), by and among the WME IMG Holdings, LLC, William Morris Endeavor Entertainment, LLC, as
borrower, IMG Worldwide Holdings, LLC, as co-borrower, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other parties thereto, shall be repaid in full in
connection with, and substantially concurrently with the closing of, the Transactions, and all commitments to lend and guarantees and security in connection therewith shall have been terminated and/or released or customary arrangements for such
termination and/or release have been agreed upon with the administrative agent (the Refinancing). |
|
f) |
The proceeds of the Equity Contribution (including the Preferred Equity Issuance), the Facilities and/or a
portion of the cash on hand at the Target and its subsidiaries on the Closing Date will be applied to pay (i) the Acquisition Consideration, (ii) the Refinancing and (iii) the fees and expenses incurred in connection with the
Transactions (such fees and expenses, the Transaction Costs, and the amounts set forth in clauses (i) through (iii) above, collectively, the Acquisition Funds). |
The transactions described above (including the payment of Transaction Costs) are collectively referred to herein as the
Transactions.
A-4
Exhibit B
Project Wildcat
Preferred Equity
Summary
of Principal Terms and Conditions
|
|
|
Issuer: |
|
Endeavor Group Holdings, Inc. (the Issuer) |
|
|
Purchasers of the Preferred Equity: |
|
DFO and Mubadala. |
|
|
Preferred Equity to be Purchased: |
|
An aggregate amount of 500,000 shares of a single class of Series A Preferred Stock of the Issuer (the Preferred
Equity), with the Stated Value (as defined below) of $1,000 per share and an initial aggregate Stated Value of $500.0 million.
Notwithstanding the foregoing, in the event of a Ratings Event, which ratings give effect to any such increased issuance or proposed issuance, the Preferred
Equity may be increased in accordance with the Commitment Letter to 600,000 shares of a single class of Series A Preferred Stock of the Issuer with the Stated Value of $1,000 per share and an initial aggregate Stated Value of
$600.0 million. Further, in the event of a Ratings Event, which ratings
give effect to both any increased issuance or proposed issuance pursuant to the foregoing paragraph and any issuance or proposed issuance to Goldman as contemplated in the Commitment Letter, the Preferred Equity may be further increased to 750,000
shares of a single class of Series A Preferred Stock of the Issuer with the Stated Value of $1,000 per share and an initial aggregate Stated Value of $750.0 million. |
|
|
OpCo Preferred Equity: |
|
On the Issue Date (as defined below), Endeavor Operating Company LLC (EOC) shall issue to Endeavor Manager, LLC (Manager) or reclassify existing common units of EOC held by Manager
into, in each case, a single class of preferred equity units of EOC (the Mirror Units), with the foregoing resulting in Mirror Units in the same number, amount of initial stated value and which shall otherwise have economic
terms consistent with that of the Preferred Equity. Any proceeds attributable to the Mirror Units received by the Manager shall be applied on a dollar for dollar basis to redeem the Preferred Equity and the Mirror Units may not at any time be
transferred by the Manager. |
B-1
|
|
|
|
|
Ranking: |
|
The Preferred Equity, with respect to dividend rights and rights upon the Issuers liquidation, winding up or dissolution, will rank senior to all other equity interests of the Issuer. |
|
|
Issue Date: |
|
The Preferred Equity to be purchased by the Purchaser will be issued on the closing date of the Acquisition (such date of issuance, the Issue Date). |
|
|
Dividends: |
|
Dividends will accrue and accumulate on a daily basis in arrears from the Issue Date at an annual rate equal to the Preferred Dividend Rate
(as defined below) on the Stated Value of the Preferred Equity outstanding from time to time, whether or not declared and paid, and if not declared and paid, will accrue and be compounded semi-annually in arrears (such compounded dividends, the
Compounded Dividends) on dividend payment dates to be mutually agreed upon by the Issuer and the Purchasers (each such date, a Dividend Payment Date). Unless otherwise elected by the Issuer,
dividends on the Preferred Equity will not be paid in cash and instead will continue to accrue and be compounded in arrears on each Dividend Payment Date. Dividends (other than Compounded Dividends, which will be redeemable solely in accordance with
Optional Redemptions and Mandatory Redemptions below) will be payable, at the election of the Issuer, in cash at any time, when, as and if declared by the board of directors of the Issuer or any authorized committee thereof.
For the avoidance of doubt, declared dividends can only be paid in cash.
Preferred Dividend Rate means 14.00% per annum from the Issue Date to the 8th
anniversary of the Issue Date, increasing by 100 basis points per annum beginning on the 8th anniversary of the Issue Date and an additional 100 basis points on each anniversary of the Issue Date
thereafter; provided that the Preferred Dividend Rate shall not at any time exceed 18.0% per annum (other than as a result of and upon the occurrence of an Event of Default).
Stated Value means, at any date of determination and with
respect to each outstanding share of Preferred Equity, the sum of (i) $1,000 (adjusted as appropriate in the event of any stock dividend, stock split, recapitalization or combination with respect to the Preferred Equity), plus (ii) the
aggregate Compounded Dividends with respect to such share as of the date of determination. |
|
|
Maturity: |
|
Perpetual. |
B-2
|
|
|
|
|
Optional Redemption: |
|
The Issuer may, at its option on any one or more dates after the Issue Date (any such date, a Redemption Date), redeem the Preferred Equity, in whole or in part, in cash at the Redemption
Price (as defined below). |
|
|
|
|
Redemption Price means, with respect to any share of Preferred Equity at any Redemption Date: |
|
|
|
|
(a) with respect to any Redemption Date occurring prior to the First Call Date, an amount per share equal to (A) the sum of (i) the Stated Value as of such Redemption Date and (ii) the Make-Whole Amount as of such
Redemption Date, with this clause (ii) discounted to the present value as of the Redemption Date using an annual discount rate (applied quarterly) equal to the rate on U.S. Treasury notes with a maturity closest to the First Call Date plus 50
basis points, plus (B) the aggregate accumulated and unpaid dividends (other than the Compounded Dividends) up to, but excluding, the Redemption Date; and |
|
|
|
|
(b) with respect to any Redemption Date occurring on or after the First Call Date, an amount per share equal to the (i) Stated Value, multiplied by the applicable Redemption Percentage, plus (ii) the
aggregate accumulated and unpaid dividends (other than Compounded Dividends), up to, but excluding, the Redemption Date. |
|
|
|
|
Make-Whole Amount means, with respect to any redemption of any share of Preferred Equity prior to the 24-month anniversary of the Issue Date (the
First Call Date), an amount equal to the sum of (I) the remaining dividends that would accrue on such share of Preferred Equity being redeemed from the Redemption Date to the First Call Date, plus (II) the
premium portion of the Redemption Price (i.e., such portion that is above par) that would be payable on the First Call Date in respect of the Preferred Equity being redeemed, assuming that, for purposes of calculating clauses (I) and (II), that
such share of Preferred Equity were to remain outstanding through the First Call Date (including any applicable deemed accumulation and compounding of dividends during such period), and then be redeemed on the First Call Date. |
|
|
|
|
Redemption Percentage means (a) beginning on the First Call Date and until the one-year anniversary of the First Call Date, 102.0% and (b) thereafter,
100%. |
B-3
|
|
|
|
|
Mandatory Redemption: |
|
In the event of (i) the occurrence of a Change of Control (as such term shall be defined and to be based on clause (b) of the
corresponding definition in the Credit Agreement dated as of August 18, 2016 among Zuffa Guarantor, LLC, UFC Holdings, LLC, as the borrower, Goldman Sachs Bank USA, as administrative agent, and the other parties thereto, as amended (but with
the deletion of clause (b) of the defined term Sponsor), and consistent with such definition in the credit agreement to be entered into on or around the Issue Date (the New Credit Agreement) but shall
require that the Issuer at all times (a) own, directly or indirectly, 100% of the equity interests of Manager and (b) control the majority of the voting interests of EOC), (ii) the consummation of an IPO (as defined below), or
(iii) any voluntary or involuntary bankruptcy, liquidation, dissolution or winding up of the Issuer or the Borrower, then all outstanding Preferred Equity shall be redeemed for cash at a price per share equal to the applicable Redemption Price
as of such Redemption Date. An IPO means the consummation of any
transaction resulting in the common equity interests of the Issuer, a parent entity or a subsidiary thereof, or a successor of the Issuer, on the New York Stock Exchange, the NASDAQ Global Market or other internationally recognized stock exchange or
similar market including via a consummated bona fide initial underwritten public offering, direct listing or consummation of a merger or acquisition by a publicly listed special purpose acquisition vehicle. |
|
|
Documentation: |
|
The Preferred Equity issued on the Issue Date will be purchased by the Purchasers pursuant to a purchase agreement to be mutually agreed between the Issuer and the Purchasers (the Purchase
Agreement), including representations and warranties substantially consistent with the New Credit Agreement, with such changes as are appropriate for a preferred equity purchase agreement (which shall include, among others,
representations as to the capitalization of the Issuer, no registration of the Preferred Equity, due authorization, valid issuance of the Preferred Equity, tax status of the Issuer as a corporation and
non-United States real property holding corporation status of the Issuer) and the Preferred Equity will be issued pursuant to a Certificate of Designations (together with the Purchase Agreement, the
Preferred Equity Documentation). |
B-4
|
|
|
|
|
Information Rights: |
|
The Certificate of Designations will include such information rights as is consistent with the New Credit Agreement, but with such modifications for a preferred equity security, including that (i) audited annual financial
statements of the Borrower shall be delivered within 120 days (or, in the case of the first fiscal year ending after the Closing Date, 150 days) of the last day of each fiscal year, (ii) unaudited quarterly financial statements of the Borrower
shall be delivered within 60 days (or, in the case of the first three fiscal quarters ending after the Closing Date, 90 days) of the last day of each of the first three fiscal quarters and (iii) prior to an IPO, the Borrower shall deliver an
annual budget within the time period required for delivery of audited annual financial statements; provided that the financials referred to in clauses (i) and (ii) shall include such information that explains in reasonable detail, the
material differences, if any, between the information relating to the Borrower and its consolidated subsidiaries on the one hand, and the Issuer and its consolidated subsidiaries on a standalone basis, on the other hand; |
|
|
Remedies to Holders: |
|
If an Event of Default (to be defined in a manner consistent with the New Credit Agreement as in effect on the Issue Date, but as applied to
the definitive documentation for the Preferred Equity and with customary modifications for a preferred equity security to be mutually agreed among the Issuer and the Purchasers) occurs, the Preferred Dividend Rate shall increase by 2.00%.
The Certificate of Designations shall include customary remedies in the event of any
breach, including specific performance and all other available remedies under equity and law, and nothing in the foregoing paragraph shall be deemed to limit the ability of a holder of Preferred Equity to exercise such remedies. |
|
|
Voting Rights: |
|
The holders of Preferred Equity will not have any voting or consent rights; provided, however, that so long as any Preferred Equity remains outstanding, unless a greater percentage is then required by law, the Issuer will not,
without the affirmative vote or consent of the Holder Majority (as defined below), (x) amend, restate, supplement, alter, modify, repeal, waive or change the terms, designations, preferences, rights, privileges or powers of, or the restrictions
provided for the benefit of, the Preferred Equity, (y) effect any binding exchanges, conversions or reclassifications of the Preferred Equity or the Mirror Units or (z) amend, restate modify or change the terms of (or otherwise permit the
amendment, restatement modification or change of the terms of) the organizational documents of the Issuer or EOC in a manner that results in a disproportionate and adverse effect on the holders of Preferred Equity in any material respect;
provided, for the avoidance of doubt, that after the Closing any issuance of preferred equity (including any preferred equity ranking pari passu with or senior to the Preferred Equity) made in compliance with the debt incurrence
covenant shall not require any affirmative vote or consent of any holder of the Preferred Equity. |
B-5
|
|
|
|
|
|
|
Holder Majority means holders of a majority of the outstanding Preferred Equity, provided, that each of DFO and Mubadala must be included in any such majority (on a separate and not joint basis) so long as
such Purchaser or any transferee thereof (to which the Preferred Equity has been transferred in compliance with the terms of the Preferred Equity Documentation) holds as of the applicable date of determination not less than 50.1% of the sum of
(i) the Stated Value of the Preferred Equity purchased by such Purchaser on the Closing Date less any Preferred Equity that has been redeemed by the Issuer from such Purchaser or transferee, as applicable, and (ii) the aggregate
Compounded Dividends with respect to such Preferred Equity referred to in clause (i) as of the date of determination; provided that (x) with respect to any Purchaser, only such Purchaser or any transferee thereof (but not both) shall be
required to constitute a Holder Majority at any given time and (y) there shall be no more than two holders at any given time who must be required to be included in the Holder Majority. |
|
|
Negative Covenants: |
|
The Preferred Equity Documentation will include customary negative covenants applicable to the Issuer and its restricted subsidiaries that
shall be substantially consistent with (but no more restrictive) than those contained in the New Credit Agreement as in effect on the Issue Date, with a 25% cushion for all baskets (but not for ratios) and with the following
exceptions: (a) with
respect to the debt incurrence covenant, incurrence shall be limited to (i) the Total Leverage Ratio test pursuant to which the Issuer and its restricted subsidiaries may incur or issue an unlimited amount of indebtedness and
preferred equity interests so long as pro forma for such incurrence, the Total Leverage Ratio (which shall be defined in a manner consistent with the New Credit Agreement as in effect on the Issue Date, but shall give effect to the Stated Value of
the Preferred Equity (but excluding any Compounded Dividends), and the liquidation preference of any preferred equity interests that are senior to or pari passu with the Preferred Equity or disqualified equity interests of
the |
B-6
|
|
|
|
|
Issuer and its restricted subsidiaries, in each case, excluding any compounded dividends accruing at a rate of up to 14%
per annum that are paid or payable in-kind) does not exceed 9.00:1.00 (it being understood that the foregoing shall not apply to indebtedness under a revolver or other working capital facility or any purchase
money indebtedness (including financing lease obligations)) and (ii) customary non-dollar and non-ratio based baskets (other than debt for borrowed money)
consistent with the New Credit Agreement as in effect on the Issue Date;
(b) the restricted payments covenant shall prohibit (i) any
in-kind distributions by the Issuer and its subsidiaries and (ii) the making of any dividend, distribution or redemption that is paid in cash in respect of shares of common equity, as a class,
of the Issuer or any of its subsidiaries pursuant to the builder basket, the unlimited ratio basket or the general restricted payments basket shall be subject to the requirements under the section titled RP Offer Amount;
and (c) limitations to be
mutually agreed between the Issuer and the Purchasers with respect to the Issuer or any of its subsidiaries pursuing any business activity in the gaming industry that would require the holders of the Preferred Equity or of any of their respective
affiliates or employees to comply with licensing requirements or requirements for invasive or burdensome disclosure of private financial or personal information, or that would impose any burdensome regulatory obligation or constraints on the holders
or their respective affiliates or employees. For the avoidance of doubt,
(x) except as set forth above, the restricted payments covenant shall include all baskets, ratios and exceptions as set forth in the New Credit Agreement as in effect on the Issue Date, with a 25% cushion for all baskets (but not
for ratios) and (y) the Issuer shall be permitted to designate subsidiaries as unrestricted subsidiaries subject only to certain requirements which shall be consistent with those set forth in the New Credit
Agreement. |
B-7
|
|
|
|
|
RP Offer Amount: |
|
In the event of any proposed dividend, distribution or redemption that is paid in cash with respect to shares of common equity, as a class, of the Issuer or any of its subsidiaries to be made in reliance upon the builder
basket, the unlimited ratio basket or the general restricted payments basket, the contemplated amount of such dividend, distribution or redemption (or, if less, the amount of the Stated Value of the then outstanding Preferred Equity) (the
RP Offer Amount) shall first be offered to the holders of Preferred Equity to redeem at par the then outstanding Preferred Equity at the then current Stated Value thereof on a pro rata basis; provided that (x) such
holders may elect to receive all or any part of their pro rata amount of such RP Offer Amount and (y) any declined amounts shall be offered to accepting holders (based on their pro rata share of such declined amounts) before such declined
amounts may fund any redemption, distribution, payment or transfer of value to any holder of junior equity interests of the Issuer, the Manager or EOC. |
|
|
Right of First Refusal: |
|
Each Purchaser shall, for so long as it continues to hold at least 25.0% of the Preferred Equity purchased by it on the Closing Date (for the avoidance of doubt, excluding any Compounded Dividends thereon), have a right of first
refusal with respect to any issuance of indebtedness or equity securities (other than those ranking junior to the Preferred Equity) to the Sponsor or their respective affiliates by the Issuer or any of its subsidiaries; provided that the
terms of such indebtedness or equity securities shall in each case be on an arms length basis. |
|
|
Affirmative Covenants: |
|
The Certificate of Designations will contain affirmative covenants with respect to maintenance of existence, compliance with laws and payment of taxes, which shall be substantially consistent with (but no more restrictive) than
those to be contained in the New Credit Agreement as in effect on the Issue Date, with such modifications as are customary for a preferred equity security to be mutually agreed among the Issuer and the Purchasers. If a business activity of the
Issuer as of the Closing would subject DFO, MSD Partners, L.P., or their respective affiliates to burdensome licensing, regulatory or disclosure obligations, the Issuer will at DFOs request use best efforts, at the Issuers expense, to
eliminate such obligation. |
|
|
Limits on Transferability: |
|
At any time from and after the Issue Date, Preferred Equity may be transferred only with the Issuers prior written consent, subject to customary exceptions for (i) transfers by DFO to its affiliates and related funds,
excluding in any event any portfolio company of DFO and its affiliates and related funds, (ii) transfers by Mubadala to its Affiliates and one or more members of the Abu Dhabi Group, excluding, in each case, any portfolio company of Mubadala,
such Affiliates or any members of the Abu Dhabi Group and (iii) pledges in connection with bona fide |
B-8
|
|
|
|
|
fund level indebtedness. The Purchasers shall be permitted to transfer their Preferred Equity without notice or consent being required to any
person upon any failure to comply with its obligations under Mandatory Redemption above, or any voluntary bankruptcy, liquidation, dissolution or winding up of the Issuer or the Borrower.
Notwithstanding anything to the contrary herein, from and after the fifth anniversary of
the Issue Date, the Preferred Equity may be transferred without notice or consent being required to a qualified institutional buyer as defined pursuant to Rule 144A promulgated under the Securities Act of 1933, as amended. |
|
|
Governance Rights: |
|
None pursuant to the Purchase Agreement or Certificate of Designations. The foregoing shall not impact or affect any governance rights that the Purchaser may have as set forth in any other documentation. |
|
|
Registration Rights: |
|
None. |
|
|
Preemptive Rights: |
|
None. |
|
|
Applicable Law: |
|
As to the Certificate of Designations: Delaware. |
|
|
|
|
As to the Purchase Agreement: New York. |
|
|
Tax Provisions: |
|
From and after the Closing Date, the Issuer will be treated as a domestic C corporation for U.S. federal income tax purposes and will not
take any action that would cause it not to be a domestic C corporation for U.S. federal income tax purposes or could otherwise cause any holder of the Preferred Equity (each, a Holder and, collectively, the
Holders) to own an interest in an entity that is not a domestic C corporation for U.S. federal income tax purposes, in each case without the consent of each of the Holders, which consent may be withheld in a Holders
sole discretion. The Preferred Equity Documentation will include provisions
reflecting the parties intent that (i) the Preferred Equity is intended to be treated as equity (and not debt) for U.S. federal income tax purposes, (ii) Holders shall not be required to include in income as a dividend for U.S.
federal income tax purposes any amounts in respect of the Preferred Equity unless and until such dividends are declared and paid in cash, and (iii) any redemption of the Preferred Equity from a Holder thereof, whether in part or in full,
qualifies as a sale or exchange of such Preferred Stock pursuant to Section 302 of the Code and not as a distribution for U.S. federal income tax purposes. |
B-9
|
|
|
|
|
The Issuer will, and will cause any paying agent or other agent of the Issuer to, report consistently with, and take no positions or actions
inconsistent with (including on any IRS Form 1099 or any other information return or by way of withholding), the intended tax treatment set forth in the preceding clauses (i) through (iii) (the Intended Tax Treatment)
unless otherwise required by a change in law or a final determination of a taxing authority which, in each case, is binding on the Issuer.
The Issuer will represent that it is not, and does not anticipate becoming, a United States real property holding corporation (USRPHC) within the
meaning of Section 897(c)(2) of the Code. The Issuer shall (a) provide to any Holder, within ten (10) days of such Holders written request, (i) a certification that the Preferred Equity does not constitute a United
States real property interest, in accordance with Treasury Regulations Section 1.897-2(h)(1) or (ii) written notice of its legal inability to provide such a certification and (b) in
connection with the provision of any certification pursuant to the preceding clause (a)(i), comply with the notice provisions set forth in Treasury Regulations Section 1.897-2(h). In the event the Issuer
becomes aware of any facts or circumstances that could reasonably be expected to cause it to become a USRPHC, the Issuer shall promptly notify the Holders.
The Issuer shall provide any information reasonably requested by the Holders to enable the Holders (and their direct or indirect equity owners) to comply with
their U.S. federal income tax reporting and withholding obligations, including, but not limited to, an estimate or determination (and accompanying certification in accordance with Treasury Regulations
Section 1.1441-3(c)(2)(ii)(A)) of the amount of the Issuers current and accumulated earnings and profits in any taxable year where such estimate or determination is relevant to determining the
amount (if any) of any distribution or deemed distribution received by the Holders from the Issuer that is properly treated as a dividend for U.S. federal income tax purposes.
The Purchaser will provide (i) an IRS Form
W-9 or (ii) IRS form W-8 claiming a complete exemption from U.S. withholding tax on dividends. Subject to compliance with the Intended Tax Treatment, the Issuer
(and any other applicable withholding agent) may deduct and withhold any amounts required to be deducted and withheld under applicable law with respect to the Preferred Equity (and may set off any such amounts required to be withheld against any
dividends or other payments on the Preferred Equity). |
B-10
|
|
|
|
|
Fees and Expenses: |
|
The Preferred Equity Documentation will contain expense reimbursement and indemnity provisions substantially consistent with the Commitment Letter. |
B-11
Exhibit C
Project Wildcat
Preferred Commitment Letter
Summary of Additional Conditions1
The funding of the Preferred Financing by any particular Purchaser on the Closing Date is subject solely to the satisfaction or waiver by such
Purchaser (or, solely in the case of paragraph 10, DFO) of the applicable conditions set forth in the section entitled Conditions in the body of the Commitment Letter and the following conditions (subject in all respects to the Limited
Conditionality Provisions):
1. Since the date of the Acquisition Agreement, no Material Adverse Effect (as defined in the Acquisition
Agreement as in effect on the Signing Date) shall have occurred and be continuing that would result in the failure of a condition precedent to your obligation to fund the Acquisition under the Acquisition Agreement or that would give you the right
(taking into account any notice and cure provisions) to terminate your obligations pursuant to the terms of the Acquisition Agreement.
2.
The Acquisition shall have been consummated, or substantially simultaneously with the purchase of the Preferred Financing and the initial borrowings under the Facilities, shall be consummated, in all material respects in accordance with the terms of
the Acquisition Agreement, after giving effect to any modifications, amendments, consents or waivers by Buyer (or any of its affiliates) thereto, other than those modifications, amendments, consents or waivers by Buyer (or its affiliate) that are
materially adverse to the interests of the Purchasers in their capacity as such when taken as a whole (it being understood that any modification, amendment, consent or waiver to the definition of Material Adverse Effect shall be deemed to be
materially adverse to the interests of the Purchasers), unless consented to in writing by the Purchasers (such consent not to be unreasonably withheld, delayed or conditioned); provided that the Purchasers shall be deemed to have consented to
such amendment, supplement, waiver or modification unless they shall object in writing thereto within three business days of being notified or otherwise becoming aware of such amendment, waiver, modification, consent or waiver being delivered;
provided, further, that, any dispositions permitted under the Acquisition Agreement shall not be deemed materially adverse to the interests of the Purchasers in their capacities as such, whether taken individually or in the aggregate;
provided, further, that without limiting any other rights and/or obligations of this Exhibit C, any modification, amendment or express waiver or consents by Buyer (or its affiliate) that results in (a) a reduction in the Acquisition
Consideration shall not be deemed to be materially adverse to the Purchasers if such reduction is applied (i) first to reduce the Equity Contribution to 35.0%, subject to the Minimum Common Equity Contribution of at least 30.0% and
(ii) thereafter, (I) 65.0% to reduce the Initial Term A Facility until the amount of commitments in respect of the Initial Term A Facility is $0, and thereafter to reduce the amount of commitments in respect of the Initial Term B Facility and
the Margin Bridge Facility and (II)
1 |
All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to
which this Exhibit C is attached, including Exhibits A and B thereto. In the case of any such capitalized term that is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit C shall be determined by reference
to the context in which it is used. |
C-1
35.0% to reduce the Equity Contribution, subject to the Minimum Common Equity Contribution of at least 30.0% and (b) an increase in the Acquisition Consideration shall be deemed to be
materially adverse to the Purchasers. Any reduction in the amount of the Equity Contribution shall be pro rata among the components of common equity contribution and the Preferred Equity or, at the option of the Purchasers, shall reduce only the
common equity contribution.
3. Confirmation from you that the Common Equity Contribution shall have been made, or substantially
simultaneously with the funding of the Preferred Financing, shall be made, in at least the amount set forth in Exhibit A to the Commitment Letter.
4. (a) Substantially simultaneously with the initial borrowing under the Term Facilities and the consummation of the Acquisition, the
Refinancing shall be consummated and (b) the borrowing of the Facilities shall have been made, or substantially simultaneously with the funding of the Preferred Financing, shall be made, in an aggregate amount not to exceed that which is set
forth with respect to the Facilities on Exhibit B of the Commitment Letter.
5. The Purchasers shall have received (a) audited
consolidated balance sheets of the Target and its consolidated subsidiaries as at the end of, and related consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash
flows of the Target and its consolidated subsidiaries for, the two most recently completed fiscal years ended at least 120 days prior to the Closing Date and (b) unaudited condensed consolidated balance sheets of the Target and its consolidated
subsidiaries as at the end of, and related unaudited condensed consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash flows of the Target and its consolidated
subsidiaries for, each subsequent fiscal quarter (other than the last fiscal quarter of the fiscal year) of the Target and its consolidated subsidiaries subsequent to the last fiscal year for which financial statements were prepared pursuant to the
preceding clause (a) and ended at least 60 days before the Closing Date (in the case of this clause (b), without footnotes). The Purchasers hereby acknowledge (x) receipt of the audited financial statements referred to in clause
(a) above for the fiscal years ended December 31, 2021, December 31, 2022 and December 31, 2023 and (y) that the public filing by the Target with the Securities and Exchange Commission of any required audited financial
statements on Form 10-K or required unaudited financial statements on Form 10-Q, in each case, will satisfy the requirements under clause (a) or (b), as applicable,
of this paragraph.
6. The Closing Date shall have occurred on or before the Expiration Date.
7. The Purchasers shall have received at least three business days prior to the Closing Date, all documentation and other information about
Holdings, the Borrower and the Issuer that shall have been reasonably requested by the Purchasers in writing at least ten business days prior to the Closing Date and that the Purchasers reasonably determine is required by United States regulatory
authorities under applicable know your customer and anti-money laundering rules and regulations, including without limitation the PATRIOT Act, including, if the Issuer qualifies as a legal entity customer under the Beneficial
Ownership Regulation (as defined below), a Beneficial Ownership Certification (as defined below) in relation to the Issuer. Beneficial Ownership Certification means a certification regarding beneficial ownership required by the
Beneficial Ownership Regulation (as defined below), which certification shall be substantially similar in substance to the form of Certification Regarding Beneficial Owners of Legal Entity Customers included as Appendix A to the Beneficial Ownership
Regulation. Beneficial Ownership Regulation means 31 C.F.R. § 1010.230.
C--2
8. Subject in each case to the Limited Conditionality Provisions, (a) the Specified
Representations shall be accurate in all material respects; provided that, any Specified Representations qualified by materiality shall be, as so qualified, accurate in all respects, and (b) the Specified Acquisition Agreement
Representations shall be accurate in all material respects provided that, any Specified Acquisition Agreement Representations qualified by materiality shall be, as so qualified, accurate in all respects.
9. Subject in all respects to the Limited Conditionality Provisions, (a) the execution and delivery by the Issuer of the Preferred Equity
Documentation (as defined in Exhibit B to the Commitment Letter) which shall be in accordance with the terms of the Commitment Letter and the Term Sheet and (b) delivery to the Purchasers of the following (the Closing
Deliverables): (i) customary legal opinions, customary officers closing certificates, organizational documents, customary evidence of authorization and good standing certificates in jurisdictions of formation/organization, in
each case with respect to the Issuer and (ii) a solvency certificate, dated as of the Closing Date, after giving effect to the Transactions, substantially in the form of Annex II to this Commitment Letter, of a senior financial executive or
officer of the Issuer (or, at the option of the Issuer, a third party opinion as to the solvency of the Issuer and its subsidiaries on a consolidated basis issued by a nationally recognized firm).
10. DFO shall have received the National Basketball Associations (and any other applicable affiliated or related entitys) prior
written consent (NBA Consent) to (i) DFO (and its direct and indirect owners) purchasing the Preferred Equity and (ii) DFOs and its Affiliates (as such term is defined in the Amended and Restated
Limited Partnership Agreement of SL SPV-4, L.P. (the Partnership Agreement) or other affiliated persons direct or indirect involvement as a party to the Transactions. Until the
NBA Consent is obtained, DFO will not be required to fund any portion of its Commitment and, in the event that either (a) the National Basketball Association notifies DFO that it will not provide its consent (or will only provide its consent
subject to any of the conditions specified in the penultimate sentence of this paragraph 10) or (b) the NBA Consent is not obtained prior to the Closing Date, DFO may rescind its Commitment, in which case you agree to release such Commitment,
in which case DFO will have no further obligations to you pursuant to this Commitment Letter. DFO will use good faith efforts to obtain the NBA Consent as promptly as practicable following the date hereof, including providing any information in
DFOs possession in connection therewith requested by the NBA; provided that in no event shall DFO or any of its direct or indirect owners, affiliates or other affiliated persons or entities be required to (A) divest or pledge any direct
or indirect interest in an NBA team or other asset or modify any contract relating to such interest or asset, (B) agree to modify any documents governing its direct or indirect interest in the Portfolio Company (as such term is defined in the
Partnership Agreement) or any NBA team or (C) agree to any other condition, restriction, under-taking, limitation, remedy or other requirement imposed on (or otherwise affecting) its or its Affiliates (as such term is defined in the
Partnership Agreement) current or future business activities except that DFO will be required to, or cause its direct or indirect owners and Affiliates (as such term is defined in the Partnership Agreement) to (X) cause its designee on the
Portfolio Companys Board of Directors (as such term is defined in the Partnership Agreement) and on any governing body
C-3
associated with an NBA team to be a different person and (Y) to agree that it will not be entitled to any information regarding, and to have any role in, any portion of the Portfolio
Companys business that relates to the NBA in any way and to offer written assurances to the NBA of the same if requested to do so. DFO will provide updates on the status of procuring the NBA Consent to you, from time to time, upon request. For
the avoidance of doubt, the rights and obligations set forth in this paragraph shall automatically expire following the Closing Date.
11.
All fees required to be paid on the Closing Date pursuant to the Commitment Letter and reasonable out-of-pocket expenses required to be paid on the Closing Date pursuant
to the Commitment Letter, to the extent invoiced at least three business days prior to the Closing Date (except as otherwise reasonably agreed by the Issuer), shall, upon the funding of the Preferred Financing, have been, or will be substantially
simultaneously, paid (which amounts may be offset against the proceeds of the Preferred Financing).
C-4
Annex I
Closing Payment
The Closing Payment
payable to each Purchaser shall be equal to 2.00% of the amount of such Purchasers Commitments that are funded on the Closing Date.
Annex I-1
Annex II
Solvency Certificate
[ ], 202[ ]
This Solvency Certificate (this Certificate) is delivered pursuant to Section [ ] of the Purchase Agreement,
dated as of [ ] (as amended as of the date hereof, and as it may be further amended, supplemented or otherwise modified, the Purchase Agreement), by and among [ ] (the
Issuer), DFO Private Investments, L.P., a Delaware limited partnership, and Thirty Fifth Investment Company L.L.C., a limited liability company incorporated in the Abu Dhabi Global Market. Unless otherwise defined herein,
capitalized terms used in this Certificate shall have the meanings set forth in the Purchase Agreement.
I, [ ], the
[ ] of the Issuer, in that capacity only and not in my individual capacity (and without personal liability), DO HEREBY CERTIFY on behalf of the Issuer that as of the date hereof, and based upon facts and circumstances as
they exist as of the date hereof (and disclaiming any responsibility for changes in such facts and circumstances after the date hereof), that:
1. For purposes of this certificate, the terms below shall have the following definitions:
(a) Fair Value
The
amount at which the assets (both tangible and intangible), in their entirety, of the Issuer and its subsidiaries taken as a whole would change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each
having reasonable knowledge of the relevant facts, with neither being under any compulsion to act.
(b) Present Fair Salable
Value
The amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the
Issuer and its subsidiaries taken as a whole are sold with reasonable promptness in an arms-length transaction under present conditions for the sale of comparable business enterprises insofar as such
conditions can be reasonably evaluated.
(c) Liabilities
The recorded liabilities (including contingent liabilities that would be recorded in accordance with GAAP) of the Issuer and its subsidiaries
taken as a whole, as of the date hereof after giving effect to the consummation of the Transactions, determined in accordance with GAAP consistently applied.
Annex II-1
(d) Will be able to pay their Liabilities as they mature
As of the date hereof, the Issuer and its subsidiaries on a consolidated basis taken as a whole will have sufficient assets and cash flow to
pay their Liabilities as those liabilities mature or (in the case of contingent Liabilities) otherwise become payable, in light of business conducted or anticipated to be conducted by the Issuer and its subsidiaries as reflected in the projected
financial statements and in light of the anticipated credit capacity.
(e) Do not have Unreasonably Small Capital
The Issuer and its subsidiaries on a consolidated basis taken as a whole after consummation of the Transactions is a going concern and has
sufficient capital to reasonably ensure that it will continue to be a going concern immediately following the consummation of the Transactions. I understand that unreasonably small capital depends upon the nature of the particular
business or businesses conducted or to be conducted, and I have reached my conclusion based on the needs and anticipated needs for capital of the business conducted or anticipated to be conducted by the Issuer and its subsidiaries on a consolidated
basis as reflected in the projected financial statements and in light of the anticipated credit capacity.
2. Based on and subject to the
foregoing, I hereby certify on behalf of the Issuer that after giving effect to the consummation of the Transactions, it is my opinion that (i) the Fair Value of the assets of the Issuer and its subsidiaries on a consolidated basis taken as a
whole exceeds their Liabilities, (ii) the Present Fair Salable Value of the assets of the Issuer and its subsidiaries on a consolidated basis taken as a whole exceeds their Liabilities; (iii) the Issuer and its subsidiaries on a
consolidated basis taken as a whole do not have Unreasonably Small Capital; and (iv) the Issuer and its subsidiaries taken as a whole will be able to pay their Liabilities as they mature.
3. In reaching the conclusions set forth in this Certificate, the undersigned has made such investigations and inquiries as the undersigned
has deemed appropriate, having taken into account the nature of the particular business anticipated to be conducted by the Issuer and the Subsidiaries after consummation of the transactions contemplated by the Purchase Agreement.
IN WITNESS WHEREOF, I have executed this Certificate as of the date first written above.
|
|
|
By: |
|
|
|
|
Name: |
|
|
Title: [Chief Financial Officer] |
Annex II-2
Exhibit (B)(3)
April 19, 2024
WILDCAT EGH HOLDCO, L.P.
c/o Silver Lake Partners
55 Hudson Yards
550 West 34th Street, 40th Floor
New York, NY 10001
Attention: Chip Schroeder
Project Wildcat
Amended and Restated Commitment Letter
Ladies and Gentlemen:
Reference is made to that
certain Commitment Letter, dated as of April 2, 2024 (the Original Commitment Letter and such date, the Original Signing Date by and among JPM, MSSF, BofA, Goldman Sachs, Barclays, DB and RBC
(each as defined below and, collectively, the Original Commitment Parties) and you. The Original Commitment Letter is hereby amended restated and superseded in its entirety as follows:
You have advised JPMorgan Chase Bank, N.A. (JPM), Morgan Stanley Senior Funding, Inc. (together with its designated
affiliates, MSSF), Bank of America, N.A. (Bank of America), BofA Securities, Inc. (through itself or one of its affiliates, BofA Securities, together with Bank of America,
BofA), Goldman Sachs Bank USA (together with any of its designated affiliates, Goldman Sachs), Barclays Bank PLC (Barclays), Deutsche Bank Securities Inc.
(DBSI), Deutsche Bank AG New York Branch (DBNY and, together with DBSI, DB), Royal Bank of Canada (RBC), RBC Capital Markets1 (RBCCM), Wells Fargo Bank, National Association (Wells Fargo Bank), Wells Fargo Securities, LLC (Wells Fargo
Securities), Citi (as defined below), HSBC Bank USA, National Association (HSBC Bank) and HSBC Securities (USA) Inc. (HSBC Securities and, together with JPM, MSSF, BofA, Goldman
Sachs, Barclays, DB, RBC, RBCCM, Wells Fargo Bank, Wells Fargo Securities, Citi and HSBC Bank and any commitment parties added pursuant to the terms hereof, we, us or the Commitment
Parties) that Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (Buyer or you), formed at the direction of Silver Lake Partners and its
affiliates (collectively with the funds, partnerships, co-investment entities and other investment vehicles managed, advised or controlled thereby or by one or more directors thereof or under common control
therewith, Silver Lake) and the Preferred Investors and, together with Silver Lake, the Sponsors), intends to consummate the Transactions described in the Transaction Description attached hereto as
Exhibit A (the Transaction Description). Capitalized terms used but not defined herein shall have the meanings assigned to them in the Transaction Description, the Summary of Principal Terms and Conditions attached hereto
as Exhibit B (the Credit Facilities Term Sheet), the Summary of Principal Terms and Conditions attached hereto as Exhibit C (the Margin Loan Term Sheet and, together with the Credit Facilities Term
Sheet, the Term Sheets) and the Summary of Additional Conditions attached hereto as Exhibit D (together with this commitment letter and the Term Sheets, the Commitment Letter).
For the purposes of this Commitment Letter, Citi shall mean Citigroup Global Markets Inc., Citibank, N.A., Citicorp USA, Inc.,
Citicorp North America, Inc. and/or any of their affiliates as Citi shall determine to be appropriate to provide the services contemplated herein.
1 |
RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its
affiliates. |
1. Commitments and Engagements.
In connection with the Transactions, each of JPM, MSSF, Bank of America, Goldman Sachs, Barclays, DB, RBC, Wells Fargo Bank, Citi and HSBC Bank
is pleased to advise you of its several, but not joint, commitment to provide 15.00%, 15.00%, 15.00%, 15.00%, 10.00%, 10.00%, 10.00%, 3.34%, 3.33% and 3.33%, respectively, of the aggregate principal amount of the Credit Facilities. JPM, MSSF, Bank
of America and Goldman Sachs, collectively with any initial lenders added pursuant to the terms hereof, are referred to herein as the Initial Lenders and each individually as an Initial Lender.
In connection with the Transactions, each of JPM, MSSF, BofA, Goldman Sachs, Barclays, DB (or an affiliate thereof), RBCCM, Wells Fargo
Securities, Citi and HSBC Securities is pleased to advise you of its agreement to use commercially reasonable efforts to arrange and provide the Margin Loan Facility. You agree that nothing herein shall constitute a commitment by us or any of our
affiliates to provide or underwrite any portion of the Margin Loan Facility. You further agree that any decision by us or any of our affiliates to participate in the Margin Loan Facility will be subject to committee approval, which none of us or our
affiliates has any legal obligation to obtain, and that in no event shall any failure to obtain such committee approval for any reason be deemed a breach of our legal obligations hereunder.
2. Titles and Roles.
It
is agreed that (i) each of JPM, MSSF, BofA Securities, Goldman Sachs, Barclays, DB, RBCCM, Wells Fargo Securities, Citi and HSBC Securities will act as a joint lead arranger for each of the Facilities (together with any other lead arranger for
each of the Facilities, if any, appointed pursuant to the terms hereof, each in such capacity, a Lead Arranger and, collectively, the Lead Arrangers), (ii) each of JPM, MSSF, BofA Securities,
Goldman Sachs, Barclays, DB, RBCCM, Wells Fargo Securities, Citi and HSBC Securities will act as a joint bookrunner for each of the Facilities (together with any other bookrunner for each of the Facilities, if any, appointed pursuant the terms
hereof, each in such capacity, a Joint Bookrunner and, collectively, the Joint Bookrunners) and (iii) JPM will act as administrative agent and collateral agent for the Credit Facilities (in
such capacity, the Administrative Agent). It is further agreed that (a) JPM shall have left side designation and shall appear on the top left of any Information Materials (as defined below) and all other
marketing materials in respect of the Initial Term A Facility, the Initial Term B Facility and the Revolving Facility, (b) the other Lead Arrangers will be listed in alphabetical order to the right of JPM in any Information Materials and all
other marketing materials in respect of the Initial Term A Facility, the Initial Term B Facility and the Revolving Facility, (c) MSSF shall have left side designation and shall appear on the top left of any Information Materials and
all other marketing materials in respect of the Margin Bridge Facility, (d) the other Lead Arrangers will be listed in alphabetical order to the right of MSSF in any Information Materials and all other marketing materials in respect of the
Margin Bridge Facility, (e) MSSF shall have left side designation and shall appear on the top left of any Information Materials and all other marketing materials in respect of the Margin Loan Facility and (f) the other Lead
Arrangers will be listed in alphabetical order to the right of MSSF in any Information Materials and all other marketing materials in respect of the Margin Loan Facility. Except as set forth below, you agree that no other agents, co-agents, arrangers, co-arrangers, bookrunners, co-bookrunners, managers or co-managers will
be appointed, no other titles will be awarded and, with respect to the Facilities, no compensation (other than compensation expressly contemplated by this Commitment Letter and the Fee Letter referred to below) will be paid by you or any of your
affiliates to any Lender (as defined below) in order to obtain its commitment to participate in the Credit Facilities or engagement to arrange the Margin Loan Facility unless you and the Required Lead Arrangers (as defined below) shall so agree.
2
3. Syndication.
The Lead Arrangers reserve the right, prior to and/or after the Closing Date (as defined below), to syndicate all or a portion of the Initial
Lenders respective commitments hereunder to a group of banks, financial institutions and other institutional lenders and investors identified by the Lead Arrangers in consultation with you and reasonably acceptable to the Lead Arrangers and
you (your consent not to be unreasonably withheld or delayed), including, without limitation, any relationship lenders designated by you and reasonably acceptable to the Lead Arrangers (such banks, financial institutions and other institutional
lenders and investors, together with the Initial Lenders, the Lenders); provided that any assignment or participation of, or
back-to-back arrangement with respect to, the Initial Term A Facility prior to the Closing Date shall be subject to your prior written consent or otherwise
in accordance with the terms of a coordination agreement to be negotiated in good faith and entered into within a reasonable time period after the date hereof (the Coordination Agreement) (it being understood that such Coordination Agreement shall be reasonably satisfactory to each Initial Lender). Notwithstanding the foregoing, and subject to any additional conditions set forth in
Exhibit C, the Lead Arrangers will not syndicate to those banks, financial institutions and other institutional lenders and investors (i) that have been separately identified in writing by you (x) to us prior to the date of this Commitment
Letter, (y) to us after the date of this Commitment Letter and prior to the Closing Date, that are reasonably acceptable to the Lead Arrangers holding a majority of the aggregate amount of outstanding financing commitments in respect of the
Facilities (the Required Lead Arrangers) and (z) with respect to the Credit Facilities, to the Administrative Agent after the Closing Date, that are reasonably acceptable to the Administrative Agent), (ii) those
persons who are competitors of you, the Target and your and their respective subsidiaries that are separately identified in writing by you to us from time to time, (iii) in the case of each of clauses (i) and (ii), any of their respective
affiliates (other than bona fide debt fund affiliates) that are either (a) identified in writing by you from time to time or (b) clearly identifiable on the basis of such affiliates name and (iv) any Excluded Affiliates (as
defined in the Credit Facilities Precedent Documentation but excluding Goldman Sachs Asset and Wealth Management Division)) (clauses (i), (ii), (iii) and (iv) above, collectively Disqualified Lenders); provided
that designations of Disqualified Lenders may not apply retroactively to disqualify any entity that has previously acquired an assignment or participation in any Facility.
Notwithstanding the Lead Arrangers right to syndicate the Facilities and receive commitments with respect thereto, (i) no Initial
Lender shall be relieved, released or novated from its obligations hereunder (including its obligation to fund the Credit Facilities on the date of both the consummation of the Acquisition and the initial funding under the Initial Term Facilities
(the date of such consummation and funding, the Closing Date)) in connection with any syndication, assignment or participation of the Facilities, including its commitments in respect of the Credit Facilities, until after
the initial funding of the Credit Facilities on the Closing Date has occurred, (ii) no assignment or novation shall become effective with respect to all or any portion of any Initial Lenders commitments in respect of the Credit Facilities
until after the initial funding of the Credit Facilities and (iii) unless you otherwise agree in writing, each Commitment Party shall retain exclusive control over all rights and obligations with respect to its commitments in respect of the
Credit Facilities, including all rights with respect to consents, modifications, supplements, waivers and amendments, until the Closing Date has occurred.
Without limiting your obligations to assist with the syndication efforts as set forth herein, it is understood that the Initial Lenders
commitments hereunder are not conditioned upon the syndication of, or receipt of commitments in respect of, the Credit Facilities and in no event shall the commencement or successful completion of syndication of the Credit Facilities constitute a
condition to the effectiveness of the Credit Facilities Documentation on the Closing Date or the availability or funding of the Credit Facilities on the Closing Date. The Lead Arrangers may commence syndication efforts promptly (taking into account
the expected timing of the Acquisition) after your acceptance of this Commitment Letter and
3
as part of their syndication efforts, it is their intent to have Lenders commit to the Facilities prior to the Closing Date (subject to the limitations set forth in the preceding paragraph).
Until the earlier of (i) the date upon which a Successful Syndication (as defined in the Fee Letter referred to below) of the applicable Facilities is achieved and (ii) the 30th day
following the Closing Date (such earlier date, the Syndication Date), you agree actively to assist the Lead Arrangers in completing a timely syndication that is reasonably satisfactory to us and you. Such assistance shall
include, without limitation, (a) your using commercially reasonable efforts to ensure that any syndication efforts benefit materially from your existing lending and investment banking relationships and the existing lending and investment
banking relationships of Silver Lake and, to the extent practical and appropriate and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, the Targets and its subsidiaries existing lending
and investment banking relationships, (b) direct contact between senior management, certain representatives and certain advisors of you and Silver Lake, on the one hand, and the proposed Lenders, on the other hand (and your using commercially
reasonable efforts to arrange, to the extent practical and appropriate and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, such contact between senior management, certain representatives or certain
advisors of the Target and its subsidiaries, on the one hand, and the proposed Lenders, on the other hand), in all such cases at times and locations to be mutually agreed upon, (c) your and Silver Lakes assistance (including the use of
commercially reasonable efforts to cause, to the extent practical and appropriate and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, the Target and its subsidiaries to assist) in the preparation of
the Information Materials (as defined below) and other customary marketing materials to be used in connection with the syndication, (d) using your commercially reasonable efforts to procure, at your expense, prior to the launch of the general
syndication of the Facilities, public ratings for the Initial Term B Facility from at least two of S&P Global Ratings (S&P), Moodys Investors Service, Inc. (Moodys) and Fitch
Ratings Inc. (Fitch), and a public corporate credit rating and a public corporate family rating in respect of the Borrower after giving effect to the Transactions from each of S&P and Moodys, respectively,
(e) the hosting, with the Lead Arrangers, of a reasonable number of meetings to be mutually agreed upon of prospective Lenders at times and locations to be mutually agreed upon (and your using commercially reasonable efforts to cause, to the
extent practical and appropriate and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, the relevant senior officers of the Target to be available for such meetings), (f) your using commercially
reasonable efforts to obtain the Margin Loan Facility on terms no less favorable to the Margin Loan Borrower under the Margin Loan Facility, in any respect, than those set forth in Exhibit C and (g) ensuring there being no competing issues,
offerings, placements, arrangements or syndications of debt securities or syndicated commercial bank or other syndicated credit facilities by or on behalf of you or any of your subsidiaries, and after using your commercially reasonable efforts, to
the extent practical, appropriate and reasonable and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, the Target or any of its subsidiaries, being offered, placed or arranged (other than (A) the
Facilities and (B) any indebtedness of the Target and its subsidiaries permitted to be incurred or to remain outstanding on the Closing Date under the Acquisition Agreement (including, for the avoidance of doubt, indebtedness in respect of that
certain First Lien Credit Agreement, dated as of August 18, 2016 (as amended, supplemented or otherwise modified from time to time, the Existing Tiger Credit Agreement), by and among Zuffa Guarantor, LLC
(Tiger Holdings), UFC Holdings, LLC, as the borrower, the lenders from time to time party thereto and Goldman Sachs Bank USA, as administrative agent, collateral agent, swingline lender and issuing bank) without the written
consent of the Required Lead Arrangers (such consent not to be unreasonably withheld or delayed), if such issuance, offering, placement or arrangement would materially and adversely impair the primary syndication of the Initial Term Facilities (it
is understood that the Targets and its subsidiaries deferred purchase price obligations, ordinary course working capital facilities, ordinary course capital lease, or purchase money and equipment financings (any such debt,
Ordinary Course Indebtedness) will not be deemed to materially and adversely impair the primary syndication of the Initial Term Facilities). Notwithstanding anything to the contrary contained in this Commitment Letter, the
Fee
4
Letter, the Coordination Agreement or any other letter agreement or undertaking concerning the financing of the Transactions to the contrary, none of the obtaining of the public ratings
referenced above, the obtaining of the Margin Loan Facility referenced above, any Preferred Equity Issuance referenced in this Commitment Letter or the compliance with any of the other provisions set forth in this paragraph, including in any of
clauses (a) through (g) above or the next succeeding paragraph, shall constitute a condition to the commitments hereunder or the funding of the Credit Facilities on the Closing Date.
The Lead Arrangers, in their capacities as such, will manage, in consultation with you, all aspects of any syndication of the Facilities,
including decisions as to the selection of institutions reasonably acceptable to you (your consent not to be unreasonably withheld or delayed) to be approached and when they will be approached, when their commitments will be accepted, which
institutions will participate (subject to your consent rights set forth in the third preceding paragraph and your rights of appointment set forth in the fourth preceding paragraph and excluding Disqualified Lenders), the allocation of the
commitments among the Lenders and the amount and distribution of fees among the Lenders. To assist the Lead Arrangers in their syndication efforts, you agree to promptly prepare and provide (and to cause Silver Lake to provide and to use
commercially reasonable efforts to cause, to the extent practical and appropriate and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, the Target and its subsidiaries to provide) to the Lead
Arrangers customary information with respect to Holdings, the Borrower, the Target and their respective subsidiaries and the Transactions set forth in clause (c) of the immediately preceding paragraph, the historical financial information set
forth in paragraph 5 of Exhibit D hereto and customary financial estimates, forecasts and other projections (such estimates, forecasts and other projections delivered to us by you, the Projections). For the avoidance of
doubt, you will not be required to provide any information to the extent that the provision thereof would violate any law, rule or regulation, or any obligation of confidentiality binding upon (so long as such obligations are not entered into in
contemplation of this Commitment Letter), or waive any privilege that may be asserted by, you, the Target or any of your or their respective subsidiaries or affiliates (in which case you agree to use commercially reasonable efforts to have any such
confidentiality obligation waived, and otherwise in all instances, to the extent practicable and not prohibited by applicable law, rule or regulation, promptly notify us that information is being withheld pursuant to this sentence). Notwithstanding
anything herein to the contrary, the only financial statements that shall be required to be provided to the Commitment Parties in connection with the syndication of the Facilities shall be those required to be delivered pursuant to paragraph 5 of
Exhibit D hereto.
You hereby acknowledge that (a) the Lead Arrangers will make available Projections and other customary marketing
material and presentations, including a customary confidential information memoranda to be used in connection with the syndication of the Facilities (the Information Memorandum) (such Projections, other marketing material
and the Information Memorandum, collectively, with the Term Sheet, the Information Materials) on a confidential basis to the proposed syndicate of Lenders by posting the Information Materials on Intralinks, Debt X, SyndTrak
Online or by similar electronic means and (b) certain of the Lenders may be public side Lenders (i.e., Lenders that wish to receive only information that (i) is publicly available, (ii) is not material with respect to you,
Holdings, the Borrower, the Target or your or their respective subsidiaries or securities for purposes of United States federal and state securities laws or (iii) constitutes information of the type that is included by the Target or its
subsidiaries in any filings with the Securities and Exchange Commission (the SEC) or that would be included in such filings if you, Holdings, the Borrower or your or their respective subsidiaries were public reporting
companies (as reasonably determined by you) (collectively, the Public Side Information; any information that is not Public Side Information, Private Side Information)) and who may be engaged in
investment and other market related activities with respect to you or the Target or your or the Targets respective subsidiaries or securities) (each, a Public Sider and each Lender that is not a Public Sider, a
Private Sider). You will be solely responsible for the contents of the Information Materials and each of the Commitment Parties shall be entitled to use and rely upon the information contained therein without responsibility
for independent verification thereof.
5
You agree to assist (and to cause Silver Lake to assist and to use commercially reasonable
efforts to cause, to the extent practical and appropriate and in all instances subject to the limitations on your rights set forth in the Acquisition Agreement, the Target to assist) us in preparing an additional version of the Information Materials
to be used in connection with the syndication of the Facilities that consists exclusively of Public Side Information with respect to you or the Target or your or the Targets respective subsidiaries or securities to Public Siders. It is
understood that in connection with your assistance described above, customary authorization letters executed and delivered by you or the Target (which shall include a customary negative assurance representation) will be included in any Information
Materials that authorize the distribution thereof to prospective Lenders, represent that the additional version of the Information Materials does not include any Private Side Information (other than information about the Transactions or the
Facilities) and exculpate you, the Investors (as defined below), the Target, the Borrower and us and our affiliates with respect to any liability related to the use of the contents of the Information Materials or related marketing materials by the
recipients thereof. Before distribution of any Information Materials you agree, at our reasonable request, to identify that portion of the Information Materials that may be distributed to the Public Siders as Public Information, which,
at a minimum, shall mean that the word PUBLIC shall appear prominently on the first page thereof. By marking Information Materials as PUBLIC, you shall be deemed to have authorized the Commitment Parties and the proposed
Lenders to treat such Information Materials as not containing any Private Side Information (it being understood that you shall not be under any obligation to mark the Information Materials PUBLIC). We will not make any materials not
marked PUBLIC available to Public Siders.
You acknowledge and agree that, subject to the confidentiality and other provisions
of this Commitment Letter, the following documents, without limitation, may be distributed to both Private Siders and Public Siders, unless you advise the Lead Arrangers in writing (including by email) within a reasonable time prior to their
intended distribution that such materials should only be distributed to Private Siders (provided that such materials have been provided to you and your counsel for review a reasonable period of time prior thereto): (a) administrative
materials prepared by the Lead Arrangers for prospective Lenders (such as a lender meeting invitation, bank allocation, if any, and funding and closing memoranda), (b) term sheets and notification of changes in the Facilities terms and
conditions, (c) drafts and final versions of the Credit Facilities Documentation and (d) financial statements of the Borrower, and its respective subsidiaries of a type that would be publicly filed if the Borrower, or its respective
subsidiaries were public reporting companies and publicly filed financial statements of the Target and its subsidiaries. If you advise us in writing (including by email), within a reasonable period of time prior to dissemination, that any of the
foregoing should be distributed only to Private Siders, then Public Siders will not receive such materials without your prior consent.
4.
Information.
You hereby represent and warrant that (a) all written information and written data (such information and data,
other than (i) the Projections and (ii) information of a general economic or industry specific nature, the Information) (in the case of Information regarding the Target and its subsidiaries and its and their
respective businesses, to the best of your knowledge), that has been or will be made available to the Commitment Parties directly or indirectly by you, the Target or by any of your or its subsidiaries or representatives, in each case, on your behalf
in connection with the transactions contemplated hereby, when taken as a whole and together with the reports and other information filed by the Target or any of its subsidiaries with the SEC (including the risk factors therein), is or will be, when
furnished, correct in all material respects and does not or will not, when furnished and when taken as a whole, contain any untrue statement of a material fact or omit to state a material fact necessary in order to
6
make the statements contained therein not materially misleading in light of the circumstances under which such statements are made (after giving effect to all supplements and updates thereto from
time to time) and (b) the Projections that have been or will be made available to the Commitment Parties by you or by any of your subsidiaries or representatives, in each case, on your behalf in connection with the transactions contemplated
hereby have been, or will be, prepared in good faith based upon assumptions that are believed by you to be reasonable at the time prepared and at the time the related Projections are so furnished to the Commitment Parties; it being understood that
the Projections are as to future events and are not to be viewed as facts, the Projections are subject to significant uncertainties and contingencies, many of which are beyond your control, that no assurance can be given that any particular
Projections will be realized and that actual results during the period or periods covered by any such Projections may differ significantly from the projected results and such differences may be material. You agree that, if at any time prior to the
later of the Closing Date and the Syndication Date, you become aware that any of the representations and warranties in the preceding sentence would be incorrect in any material respect if the Information and the Projections were being furnished, and
such representations and warranties were being made, at such time, then you will (or, with respect to the Information and Projections relating to the Target and its subsidiaries, will use commercially reasonable efforts to) promptly supplement the
Information and the Projections such that such representations and warranties are correct in all material respects under those circumstances (or, in the case of the Information relating to the Target and its subsidiaries and its and their respective
businesses, to the best of your knowledge, such representations and warranties are correct in all material respects under those circumstances). In arranging and syndicating the Facilities, the Lead Arrangers (i) will be entitled to use and rely
primarily on the Information and the Projections without responsibility for independent verification thereof and (ii) assume no responsibility for the accuracy or completeness of the Information or the Projections.
5. Fees.
As
consideration for the commitments of the Initial Lenders hereunder and for the agreement of the Lead Arrangers and the Joint Bookrunners to perform the services described herein, you agree to pay (or cause to be paid) the fees set forth in the Term
Sheets and in the Amended and Restated Fee Letter and each Structuring Fee Letter dated the Original Signing Date and delivered herewith with respect to the Facilities (the Fee Letter), if and to the extent payable. Once
paid, such fees shall not be refundable under any circumstances, except as expressly set forth herein or therein or as otherwise separately agreed to in writing by you and us.
6. Conditions.
The
commitments of the Initial Lenders hereunder to fund the Credit Facilities on the Closing Date and the agreements of the Lead Arrangers and the Joint Bookrunners to perform the services described herein are subject solely to (a) the applicable
conditions expressly set forth in the section entitled Conditions to Initial Borrowing in Exhibit B hereto and (b) the applicable conditions expressly set forth in Exhibit D hereto, and upon satisfaction (or waiver by the Commitment
Parties) of such conditions, the Administrative Agent, each Lender and each other party thereto will execute and deliver the Credit Facilities Documentation (together with the Margin Loan Facility Documentation, the Facilities
Documentation) to which it is a party and the initial funding of the Credit Facilities shall occur; it being understood that there are no other conditions (implied or otherwise) to the commitments hereunder, including compliance with
the terms of this Commitment Letter, the Fee Letter, the Coordination Agreement and the Credit Facilities Documentation.
7
Notwithstanding anything to the contrary in this Commitment Letter (including each of the
exhibits attached hereto), the Fee Letter, the Coordination Agreement, the Facilities Documentation or any other letter agreement or other undertaking concerning the financing of the Transactions to the contrary, (i) the only representations
and warranties relating to you, Holdings, the Borrower or the Target or your or their respective subsidiaries or businesses or otherwise, the making and accuracy of which shall be a condition to the availability and funding of the Credit Facilities
on the Closing Date shall be (a) such of the representations and warranties (if any) made by, or with respect to, the Target and its subsidiaries in the Acquisition Agreement as are material to the interests of the Lenders, but only to the
extent that you (or your affiliate) have the right (taking into account any applicable notice and cure provisions) to terminate your (and/or its) obligations under the Acquisition Agreement or decline to consummate the Acquisition or otherwise
results in a failure of a condition precedent in the Acquisition Agreement (in each case, in accordance with the terms thereof) as a result of a breach of such representations and warranties in the Acquisition Agreement (to such extent, the
Specified Acquisition Agreement Representations) and (b) the Specified Representations (as defined below) in all material respects; provided that any Specified Representations qualified by materiality shall be,
as so qualified, accurate in all respects and (ii) the terms of the Credit Facilities Documentation shall be in a form such that they do not impair the availability or funding of the Credit Facilities on the Closing Date if the applicable
conditions expressly set forth in the section entitled Conditions to Initial Borrowing in Exhibit B hereto and in Exhibit D hereto are satisfied (or waived by the Commitment Parties) (provided that, to the extent any security
interest in any Collateral (as such term is defined in the Credit Facilities Term Sheet for purposes of this paragraph) is not or cannot be provided and/or perfected on the Closing Date (other than the pledge and perfection of the security interests
(1) in the certificated equity securities, if any, of the Borrower, the Target and any wholly owned U.S. material subsidiaries of the Borrower and the Target (to the extent required by the Credit Facilities Term Sheet) and (2) in other
assets with respect to which a lien may be perfected by the filing of a financing statement under the Uniform Commercial Code; provided that any such certificated equity securities of the Target and such subsidiaries of the Target will be
required to be delivered on the Closing Date only to the extent such certificates are actually received from the Target) after your use of commercially reasonable efforts to do so or without undue burden or expense, then the provision and/or
perfection of a security interest in such Collateral shall not constitute a condition precedent to the availability of the Credit Facilities on the Closing Date, but instead shall be required to be delivered after the Closing Date pursuant to
arrangements and timing to be mutually agreed by the Administrative Agent and the Borrower acting reasonably but no later than 90 days after the Closing Date (or such longer period as may be agreed by the Administrative Agent and the Borrower acting
reasonably)). For purposes hereof, Specified Representations means, with respect to the Credit Facilities, the applicable representations and warranties of the Borrower and the Guarantors to be set forth in the Credit
Facilities Documentation relating to organizational existence of the Borrower and the Guarantors party thereto as of the Closing Date; power and authority, due authorization, execution, delivery and enforceability, in each case, related to, the
entering into, borrowing under, guaranteeing under, performance of, and granting of security interests in the Collateral pursuant to, the Credit Facilities Documentation; solvency as of the Closing Date (after giving effect to the Transactions) of
the Borrower and its subsidiaries on a consolidated basis (solvency to be defined in a manner consistent with the manner in which solvency is determined in the solvency certificate to be delivered pursuant to Exhibit D); no violation of Federal
Reserve margin regulations; the use of the proceeds of the Credit Facilities not violating the PATRIOT Act, OFAC or FCPA; the Investment Company Act; the incurrence of the loans to be made under such Credit Facilities, the provision of the
Guarantees in respect of such Credit Facilities and the granting of the security interests in the Collateral to secure such Credit Facilities, and the entering into of the Credit Facilities Documentation on the Closing Date, do not conflict with the
organizational documents of the Borrower or the Guarantors party thereto; and, subject to the provisos in clause (ii) of the immediately preceding sentence, creation, validity and perfection of security interests in the Collateral (as such term
is defined in Exhibit B). For the avoidance of doubt, the representation set forth in paragraph 1 of Exhibit D shall not be a Specified Representation. This paragraph, and the provisions herein, shall be referred to as the Limited
Conditionality Provisions.
8
7. Limitation on Liability; Indemnity; Settlement.
(a) Limitation on Liability.
Notwithstanding any other provision of this Commitment Letter, (i) in no event shall any Commitment Party, any of their respective
affiliates or their respective officers, directors, employees, agents, controlling persons, advisors, attorneys or other representatives (each an Arranger-Related Person) be liable for any damages arising from the use by
others of information or other materials obtained through internet, electronic, telecommunications or other information transmission systems, except to the extent that such damages have resulted from the willful misconduct, bad faith or gross
negligence of such Arranger-Related Person (as determined by a court of competent jurisdiction in a final and non-appealable decision) and (ii) none of you (or any of your subsidiaries), the Investors (or
any of their respective affiliates), the Target (or any of its subsidiaries or affiliates) or any Arranger-Related Person shall be liable for any indirect, special, punitive or consequential damages (including, without limitation, any loss of
profits, business or anticipated savings) in connection with this Commitment Letter, the Fee Letter, the Coordination Agreement, the Transactions (including the Facilities and the use of proceeds thereunder), or with respect to any activities
related to the Facilities, including the preparation of this Commitment Letter, the Fee Letter, the Coordination Agreement and the Facilities Documentation; provided that nothing in this paragraph shall limit your indemnity and reimbursement
obligations to the extent that such indirect, special, punitive or consequential damages are included in any claim by a third party with respect to which the applicable Indemnified Party is entitled to indemnification under subsection (b) of
this Section 7.
(b) Indemnity.
To induce the Commitment Parties to enter into this Commitment Letter and the Fee Letter and to proceed with the Facilities Documentation, you
agree (a) to indemnify and hold harmless each Commitment Party, its respective affiliates and the respective officers, directors, employees, agents, controlling persons, advisors, attorneys and other representatives of each of the foregoing and
their successors and permitted assigns (other than Lenders that are not Initial Lenders) (each, an Indemnified Person), from and against any and all losses, claims, damages and liabilities of any kind or nature and
reasonable and documented or invoiced out-of-pocket fees and expenses, joint or several, to which any such Indemnified Person may become subject to the extent arising
out of, resulting from, or in connection with any actual or threatened claim, litigation, investigation or proceeding (including any inquiry or investigation) in connection with the Original Commitment Letter, this Commitment Letter (including the
Term Sheet), the Original Fee Letter (as defined in the Fee Letter), the Fee Letter, the Coordination Agreement, the Transactions or any related transaction contemplated hereby or thereby, the Facilities or any use of the proceeds thereof (any of
the foregoing, a Proceeding), regardless of whether any such Indemnified Person is a party thereto, whether or not such Proceedings are brought by you, your equity holders, affiliates or creditors or any other third person,
and to promptly reimburse after receipt of a written request, each such Indemnified Person for any reasonable and documented or invoiced out-of-pocket legal fees and
expenses incurred in connection with investigating or defending any of the foregoing by one firm of counsel for all such Indemnified Persons, taken as a whole and, if necessary, by a single firm of local counsel in each appropriate jurisdiction
(which may include a single firm of special counsel acting in multiple jurisdictions) for all such Indemnified Persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Person affected by such
conflict notifies you of the existence of such conflict and thereafter retains its own counsel, by another firm of counsel for such affected Indemnified Person) or other reasonable and documented or invoiced out-of-pocket fees and expenses incurred in connection with investigating, responding to, or defending any of the foregoing; provided that the foregoing indemnity will not, as to any Indemnified
Person, apply to losses, claims, damages, liabilities or related expenses to the extent that they have resulted from (i) the
9
willful misconduct, bad faith or gross negligence of such Indemnified Person or any Related Indemnified Person (as defined below) (as determined by a court of competent jurisdiction in a final
and non-appealable decision), (ii) a material breach of the obligations of such Indemnified Person or any Related Indemnified Person under this Commitment Letter, the Fee Letter or the Coordination Agreement
(as determined by a court of competent jurisdiction in a final and non-appealable decision) or (iii) any Proceeding solely between or among Indemnified Persons not arising from any act or omission by you
or any of your affiliates; provided that the Administrative Agent, the Lead Arrangers and the Joint Bookrunners to the extent fulfilling their respective roles as an agent or arranger under the Facilities and in their capacities as such,
shall remain indemnified in such Proceedings to the extent that none of the exceptions set forth in any of clauses (i) or (ii) of the immediately preceding proviso apply to such person at such time and (b) to the extent that the Closing
Date occurs, to reimburse each Commitment Party from time to time, upon presentation of a summary statement, for all reasonable and documented or invoiced out-of-pocket
expenses (including but not limited to expenses of each Commitment Partys consultants fees (to the extent any such consultant has been retained with your prior written consent (not to be unreasonably withheld or delayed)), syndication
expenses, travel expenses and reasonable fees, disbursements and other charges of counsel to the Commitment Parties, the Lead Arrangers, the Joint Bookrunners and the Administrative Agent identified in the Credit Facilities Term Sheet (and, in the
case of an actual or perceived conflict of interest where the Indemnified Person affected by such conflict informs you of such conflict and thereafter retains its own counsel, of another firm of counsel for such affected Indemnified Person), and, if
necessary, of a single firm of local counsel to the Commitment Parties in each appropriate jurisdiction (which may include a single firm of special counsel acting in multiple jurisdictions) and of such other counsel retained with your prior written
consent (not to be unreasonably withheld or delayed)), in each case incurred in connection with the Facilities and the preparation, negotiation and enforcement of the Original Commitment Letter, this Commitment Letter, the Original Fee Letter (as
defined the Fee Letter), the Fee Letter, the Coordination Agreement, the Facilities Documentation and any security arrangements in connection therewith (collectively, the Expenses). You acknowledge that we may receive a
future benefit on matters unrelated to this matter, including, without limitation, discount, credit or other accommodation, from any of such counsel based on the fees such counsel may receive on account of their relationship with us, including
without limitation fees paid pursuant hereto (it being understood and agreed that, in no event, shall the Expenses include items in respect of any unrelated matter or otherwise be increased as a result of such counsels representation of us on
another matter or on account of our relationship with such counsel). The foregoing provisions in this paragraph shall be superseded, in each case, to the extent covered thereby by the applicable provisions contained in the Facilities Documentation
upon execution and delivery thereof and thereafter shall have no further force and effect.
Related Indemnified Person of an
Indemnified Person means (1) any controlling person or any affiliate of such Indemnified Person, (2) the respective directors, officers, or employees of such Indemnified Person or any of its controlling persons or any of its affiliates and
(3) the respective agents, advisors, attorneys and representatives of such Indemnified Person or any of its controlling persons or any of its affiliates, in the case of this clause (3), acting at the instructions of such Indemnified Person,
controlling person or such affiliate (it being understood and agreed that any agent, advisor or representative of such Indemnified Person or any of its controlling persons or any of its affiliates engaged to represent or otherwise advise such
Indemnified Person, controlling person or affiliate in connection with the Transactions shall be deemed to be acting at the instruction of such person).
10
(c) Settlement.
You shall not be liable for any settlement of any Proceeding effected without your written consent (which consent shall not be unreasonably
withheld, conditioned or delayed), but if settled with your written consent or if there is a final and non-appealable judgment by a court of competent jurisdiction in any such Proceeding, you agree to
indemnify and hold harmless each Indemnified Person from and against any and all losses, claims, damages, liabilities and reasonable and documented legal or other
out-of-pocket expenses by reason of such settlement or judgment in accordance with and to the extent provided in the other provisions of this Section 7. It is
further agreed that the Commitment Parties shall be severally liable in respect of their commitments to the Facilities, on a several, and not joint basis with any other Lender.
You shall not, without the prior written consent of any Indemnified Person (which consent shall not be unreasonably withheld, conditioned or
delayed) (it being understood that the withholding of consent due to non-satisfaction of any of the conditions described in clauses (i), (ii) and (iii) of this sentence shall be deemed reasonable), effect
any settlement of any pending or threatened Proceedings in respect of which indemnity could have been sought hereunder by such Indemnified Person unless such settlement (i) includes an unconditional release of such Indemnified Person in form
and substance reasonably satisfactory to such Indemnified Person from all liability or claims that are the subject matter of such proceedings, (ii) does not include any statement as to or any admission of fault, culpability, wrong doing or a
failure to act by or on behalf of any Indemnified Person and (iii) contains customary confidentiality provisions with respect to the terms of such settlement. Each Indemnified Person shall be severally obligated to refund or return any and all
amounts paid by you under this Section 7 to the extent such Indemnified Person is not entitled to payment of such amounts in accordance with the terms hereof (as determined by a court of competent jurisdiction in a final and non-appealable judgment).
8. Sharing of Information, Absence of Fiduciary Relationships, Affiliate
Activities.
As you know, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, an affiliate of MSSF, BofA Securities, Goldman
Sachs & Co. LLC, Barclays Capital Inc., DB and RBC Capital Markets LLC have each been retained by Buyer (or one of its affiliates) as financial advisor (each in such capacity, a Financial Advisor) in connection
with the Acquisition. You acknowledge such retention, and further agree not to assert any claim you might allege based on any actual or potential conflicts of interest that might be asserted to arise or result from the engagement of each Financial
Advisor, on the one hand, and such Commitment Partys or its affiliates relationships with you as described and referred to herein, on the other. Each of the Commitment Parties hereto acknowledges (i) the retention of each Financial
Advisor and (ii) that such relationship does not create any fiduciary duties or fiduciary responsibilities to such Commitment Party on the part of any Financial Advisor or its affiliates.
You acknowledge that the Commitment Parties and their respective affiliates may be providing debt financing, equity capital or other services
(including, without limitation, financial advisory services) to other persons in respect of which you, the Investors, the Target and your and their respective subsidiaries and affiliates may have conflicting interests regarding the transactions
described herein and otherwise. The Commitment Parties and their respective affiliates will not use confidential information obtained from you, the Target or any of your or their respective subsidiaries or affiliates by virtue of the transactions
contemplated by this Commitment Letter or their other relationships with you, the Target or any of your or their respective subsidiaries or affiliates in connection with the performance by them or their affiliates of services for other persons, and
the Commitment Parties and their respective affiliates will not furnish any such information to other persons, except to the extent permitted below. You also acknowledge that the Commitment Parties and their respective affiliates do not have any
obligation to use in connection with the transactions contemplated by this Commitment Letter, or to furnish to you, the Target or any of your or their respective subsidiaries or affiliates confidential information obtained by them from other
persons.
11
As you know, the Commitment Parties and their respective affiliates may be full-service
securities firms engaged, either directly or through their affiliates, in various activities, including securities trading, commodities trading, investment management, financing and brokerage activities and financial planning and benefits counseling
for both companies and individuals. In the ordinary course of these activities, the Commitment Parties and their respective affiliates may actively engage in commodities trading or trade the debt and equity securities (or related derivative
securities) and financial instruments (including bank loans and other obligations) of you (and your affiliates), the Target (and its affiliates), the Targets and your respective customers or competitors and other companies which may be the
subject of the arrangements contemplated by this Commitment Letter for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities. The Commitment Parties and their respective
affiliates may also co-invest with, make direct investments in, and invest or co-invest client monies in or with funds or other investment vehicles managed by other
parties, and such funds or other investment vehicles may trade or make investments in securities of you (and your affiliates), the Borrower, the Target (and its affiliates) or other companies which may be the subject of the arrangements contemplated
by this Commitment Letter or engage in commodities or other trading with any thereof.
The Commitment Parties and their respective
affiliates may have economic interests that conflict with those of the Target, you and the Borrower and your and their respective subsidiaries and affiliates and are under no obligation to disclose any conflicting interest to you, the Target and the
Borrower and your and their respective subsidiaries and affiliates. You agree that each Commitment Party will act under this Commitment Letter as an independent contractor and that nothing in this Commitment Letter or the Fee Letter will be deemed
to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between such Commitment Party and its respective affiliates, on the one hand, and you, the Borrower and the Target, your and their respective equity holders
or your and their respective subsidiaries and affiliates, on the other hand. You acknowledge and agree that (i) the transactions contemplated by this Commitment Letter and the Fee Letter are
arms-length commercial transactions between the Commitment Parties and their respective affiliates, on the one hand, and you, on the other, (ii) in connection therewith and with the process leading
to such transaction each Commitment Party and its applicable affiliates (as the case may be) are acting solely as principals and not as agents or fiduciaries of you, the Borrower, the Target, your and their respective management, equity holders,
creditors, subsidiaries, affiliates or any other person, (iii) each Commitment Party and its applicable affiliates (as the case may be) have not assumed an advisory or fiduciary responsibility or any other obligation in favor of you, the
Target, the Borrower or your or their respective affiliates with respect to the financing transactions contemplated hereby, the exercise of the remedies with respect thereto or the process leading thereto (irrespective of whether such Commitment
Party or any of its affiliates has advised or is currently advising you, the Borrower, or the Target or any of your or their respective affiliates on other matters) and no Commitment Party has any obligation to you, the Target, the Borrower or your
or their respective affiliates with respect to the transactions contemplated hereby except the obligations expressly set forth in this Commitment Letter, the Fee Letter and the Coordination Agreement and (iv) the Commitment Parties and their
respective affiliates have not provided any legal, accounting, regulatory or tax advice and you have consulted your own legal and financial advisors to the extent you deemed appropriate.
You further acknowledge and agree that you are responsible for making your own independent judgment with respect to such transactions and the
process leading thereto. You agree that you will not claim that the Commitment Parties or their applicable affiliates, as the case may be, have rendered advisory services of any nature or respect, or owe a fiduciary, agency or similar duty to you or
your affiliates, in connection with such transactions or the process leading thereto.
Furthermore, without limiting any provision set
forth herein, you agree not to assert, to the fullest extent permitted by law, any claims you may have with respect to such transactions or the process leading thereto against us or our affiliates for alleged breach of fiduciary duty and agree that
we and our affiliates shall have no liability (whether direct or indirect) to you in respect of such a fiduciary claim or to any person asserting a fiduciary duty claim on behalf of or in right of you, including your equityholders, employees or
creditors.
12
9. Confidentiality.
You agree that you will not disclose, directly or indirectly, the Fee Letter or the contents thereof or, prior to your acceptance hereof, this
Commitment Letter, the Term Sheet, the other exhibits and attachments hereto or the contents of each thereof, or the activities of any Commitment Party pursuant hereto or thereto, to any person or entity without the prior written approval of the
Lead Arrangers (such approval not to be unreasonably withheld, delayed or conditioned), except (a) to the Investors and to any of your or the Investors affiliates and your and their respective officers, directors, employees, agents,
attorneys, accountants, advisors, controlling persons and equity holders and to actual and potential co-investors who are informed of the confidential nature thereof, on a confidential and need-to-know basis, (b) if the Commitment Parties consent in writing to such proposed disclosure or (c) pursuant to an order of any court or administrative agency or
in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal process or to the extent requested or required by governmental and/or regulatory authorities, in each
case based on the reasonable advice of your legal counsel (in which case you agree, to the extent practicable and not prohibited by applicable law, rule or regulation, to inform us promptly thereof prior to disclosure); provided that
(i) you may disclose this Commitment Letter (but not the Fee Letter or the contents thereof) and the contents hereof to the Target, its subsidiaries and affiliates and its and their respective officers, directors, employees, agents, attorneys,
accountants, advisors and controlling persons, on a confidential and need-to-know basis, (ii) you may disclose the Commitment Letter and its contents (including the
Term Sheets and other exhibits and attachments hereto) (but not the Fee Letter or the contents thereof) in any syndication or other marketing materials in connection with the Facilities (including the Information Materials) or in connection with any
public or regulatory filing requirement relating to the Transactions, (iii) you may disclose the Term Sheets and other exhibits and attachments to the Commitment Letter, and the contents thereof, to potential Lenders, the issuer, the custodian
and the transfer agent in connection with the Margin Loan Facility and to rating agencies in connection with obtaining public ratings for the Borrower and the Initial Term B Facility, (iv) you may disclose the aggregate fee amount contained in
the Fee Letter as part of Projections, pro forma information or a generic disclosure of aggregate sources and uses related to fee amounts related to the Transactions to the extent customary or required in marketing materials for the Facilities or in
any public or regulatory filing requirement relating to the Transactions (and only to the extent aggregated with all other fees and expenses of the Transactions and not presented as an individual line item unless required by applicable law, rule or
regulation) and (v) if the fee amounts payable pursuant to the Fee Letter and the economic terms of the Market Flex Provisions in the Fee Letter, and such other portions as mutually agreed, have been redacted in a manner reasonably
agreed by us (including the portions thereof addressing fees payable to the Commitment Parties and/or the Lenders), you may disclose the Fee Letter and the contents thereof to the Target, its subsidiaries and affiliates and its and their respective
officers, directors, employees, agents, attorneys, accountants, advisors and controlling persons, on a confidential and need-to-know basis.
Each Commitment Party and its affiliates will use all non-public information provided to any of them
or such affiliates by or on behalf of you hereunder or in connection with the Acquisition and the related Transactions solely for the purpose of providing the services which are the subject of this Commitment Letter and negotiating, evaluating and
consummating the transactions contemplated hereby and shall treat confidentially all such information and shall not publish, disclose or otherwise divulge, such information; provided that nothing herein shall prevent such Commitment Party and
its affiliates from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation
or compulsory legal process based on the reasonable advice of counsel (in which case such
13
Commitment Party agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory authority or governmental regulatory authority exercising examination
or regulatory authority), to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (b) upon the request or demand of any regulatory authority having jurisdiction, or
purporting to have jurisdiction, over such Commitment Party or any of its affiliates (in which case such Commitment Party agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory authority or
governmental regulatory authority exercising examination or regulatory authority), to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (c) to the extent that such
information becomes publicly available other than by reason of improper disclosure by such Commitment Party or any of its Related Parties (as defined below) in violation of any confidentiality obligations owing to you, the Investors, the Borrower,
the Target or any of your or their respective subsidiaries and affiliates, (d) to the extent that such information is or was received by such Commitment Party or any of its Related Parties from a third party that is not, to such Commitment
Partys knowledge, subject to contractual or fiduciary confidentiality obligations owing to you, the Investors, the Target or any of your or their respective subsidiaries and affiliates, (e) to the extent that such information is
independently developed by such Commitment Party or any of its Related Parties without the use of any confidential information, (f) to such Commitment Partys affiliates and to its and their respective employees, officers, directors, legal
counsel, independent auditors, rating agencies, professionals and other experts or agents who need to know such information in connection with the Transactions and who are informed of the confidential nature of such information and who are subject
to customary confidentiality obligations and who have been advised of their obligation to keep information of this type confidential (with each such Commitment Party, to the extent within its control, responsible for such persons compliance
with this paragraph) (the persons identified in this clause (f), collectively, the Related Parties), (g) to potential or prospective Lenders, hedge providers, participants or assignees, (h) to the extent you consent in
writing to any specific disclosure or (i) to the extent such information was already in such Commitment Partys possession prior to any duty or other understanding of confidentiality entered into in connection with the Transactions;
provided that for purposes of clause (g) above, (i) the disclosure of any such information to any Lenders, hedge providers, participants or assignees or prospective Lenders, hedge providers, participants or assignees referred to above
shall be made subject to the acknowledgment and acceptance by such Lender, hedge provider, participant or assignee or prospective Lender, hedge provider, participant or assignee that such information is being disseminated on a confidential basis (on
substantially the terms set forth in this paragraph or as is otherwise reasonably acceptable to you and such Commitment Party, including, without limitation, as agreed in any Information Materials or other marketing materials) in accordance with the
standard syndication processes of such Commitment Party or customary market standards for dissemination of such type of information, which shall in any event require click through or other affirmative actions on the part of recipient to
access such information and (ii) no such disclosure shall be made by such Commitment Party to any person that is at such time a Disqualified Lender. In addition, each Commitment Party may disclose the existence of the Facilities and the
information about the Facilities to market data collectors, similar services providers to the lending industry, and service providers to the Commitment Parties in connection with the administration and management of the Facilities. In the event that
the Facilities are funded, the Commitment Parties and their respective affiliates, if any, obligations under this paragraph shall terminate automatically and be superseded by the confidentiality provisions in the Facilities Documentation
upon the initial funding thereunder to the extent that such provisions are binding on such Commitment Parties.
Subject to the immediately
preceding sentence, the confidentiality provisions set forth in this Section 9 shall survive the termination of this Commitment Letter and expire and shall be of no further effect after the second anniversary of the Original Signing Date.
14
Notwithstanding anything to the contrary contained herein, the confidentiality provisions of
the Original Commitment Letter shall remain in full force and effect with respect to the Original Commitment Letter and the Original Fee Letter (as defined in the Fee Letter) in accordance with the terms of the Original Commitment Letter.
10. Miscellaneous.
This
Commitment Letter and the commitments hereunder shall not be assignable by any party hereto (other than (i) any assignment occurring as a matter of law pursuant to, or otherwise substantially simultaneously with, the Acquisition on the Closing
Date, in each case to the Target, Merger Sub or the Borrower, (ii) by you to (a) Target, Merger Sub or the Borrower substantially simultaneously with the Acquisition on the Closing Date or (b) a U.S. domestically organized entity, in
each case, so long as such entity is, or will be, controlled by you or the Investors after giving effect to the Transactions and shall (directly or indirectly through one or more wholly-owned subsidiaries) own the Target and the Borrower and agrees
to be bound by the terms hereof and of the Fee Letter and the Coordination Agreement, (iii) subject to the second paragraph of Section 3, by the Initial Lenders in connection with the syndication of the Credit Facilities) without the prior
written consent of each other party hereto (such consent not to be unreasonably withheld, conditioned or delayed) (and any attempted assignment without such consent shall be null and void) or (iv) by Goldman Sachs to Goldman Sachs Lending
Partners LLC (GSLP) without the consent of any party hereto). This Commitment Letter and the commitments hereunder are intended to be solely for the benefit of the parties hereto (and Indemnified Persons and
Arranger-Related Persons) and do not and are not intended to confer any benefits upon, or create any rights in favor of, any person other than the parties hereto (and Indemnified Persons and Arranger-Related Persons to the extent expressly set forth
herein) and, for the avoidance of doubt, no Commitment Party may enter into any other agreements or arrangement to share any economics provided in the Commitment Letter or Fee Letter with any other parties (other than any agreement or arrangement
with an affiliate of such Commitment Party as permitted hereunder or under the Fee Letter). Subject to the limitations set forth in Section 3 above, each Commitment Party reserves the right to employ the services of its respective affiliates or
branches in providing services contemplated hereby and to allocate, in whole or in part, to their affiliates or branches certain fees payable to such Commitment Party in such manner as such Commitment Party and its respective affiliates or branches
may agree in their sole discretion and, to the extent so employed, such affiliates and branches shall be entitled to the benefits and protections afforded to, and subject to the provisions governing the conduct of, such Commitment Party hereunder.
This Commitment Letter may not be amended or any provision hereof waived or modified except by an instrument in writing signed by each of the Commitment Parties and you. This Commitment Letter may be executed in any number of counterparts, each of
which shall be deemed an original and all of which, when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission or other electronic transmission
(i.e., a pdf or tif) shall be effective as delivery of a manually executed counterpart hereof. Electronic transmission shall be deemed to include any electronic symbol or process attached to, or associated with, any contract
or other record and adopted by a person with the intent to sign, authenticate or accept such contract or record (Electronic Signatures), deliveries or the keeping of records in electronic form, each of which shall be of the
same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the
Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act. This Commitment Letter (including the
exhibits hereto), together with the Fee Letter, the Coordination Agreement and any other letter agreement entered into with any of the Commitment Parties on or prior to the Original Signing Date, (i) are the only agreements that have been
entered into among the parties hereto with respect to our commitments with respect to the Facilities and (ii) supersede all prior understandings, whether written or oral, among us with
15
respect to the Facilities and sets forth the entire understanding of the parties hereto with respect thereto. THIS COMMITMENT LETTER, AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER, OR
RELATED TO, THIS COMMITMENT LETTER (INCLUDING, WITHOUT LIMITATION, ANY CLAIMS SOUNDING IN CONTRACT LAW OR TORT LAW ARISING OUT OF THE SUBJECT MATTER HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK;
provided that, notwithstanding the foregoing, it is understood and agreed that (a) the interpretation of the definition of Material Adverse Effect (as defined in the Acquisition Agreement) (and whether or not a Material
Adverse Effect has occurred), (b) the determination of the accuracy of any Specified Acquisition Agreement Representation and whether as a result of any inaccuracy thereof you (or your affiliate) have the right (taking into account any applicable
cure provisions) to terminate your obligations under the Acquisition Agreement or decline to consummate the Acquisition and (c) the determination of whether the Acquisition has been consummated in accordance with the terms of the Acquisition
Agreement, in each case shall be governed by, and construed in accordance with, the laws of the State of Delaware as applied to the Acquisition Agreement, without regard to the principles of conflicts of law that would cause the application of law
of any jurisdiction other than those of the State of Delaware.
Any Joint Bookrunner may, in consultation with you, place customary
advertisements in financial and other newspapers and periodicals or on a home page or similar place for dissemination of customary information on the Internet or worldwide web as it may choose, and circulate similar promotional materials, in each
case, after the Closing Date, in the form of tombstone or otherwise describing the name of the Borrower and the amount, type and closing date of the Transactions, all at the expense of such Joint Bookrunner.
Each of the parties hereto agrees that this Commitment Letter is a binding and enforceable agreement with respect to the subject matter
contained herein, including an agreement to negotiate in good faith the Facilities Documentation by the parties hereto in a manner consistent with this Commitment Letter, it being acknowledged and agreed that the commitments provided hereunder are
subject solely to conditions precedent described in the first paragraph of Section 6 of this Commitment Letter.
EACH OF THE PARTIES
HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER, THE FEE LETTER OR THE COORDINATION AGREEMENT OR THE
PERFORMANCE OF SERVICES HEREUNDER OR THEREUNDER.
Each of the parties hereto hereby irrevocably and unconditionally (a) submits, for
itself and its property, to the exclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York County in the State of New York, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Commitment Letter, the Fee Letter, the Coordination Agreement or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and agrees that all claims in respect
of any such action or proceeding shall be heard and determined in such New York State court or, to the extent permitted by law, in such Federal court, (b) waives, to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter, the Coordination Agreement or the transactions contemplated hereby or thereby in any New York
State or in any such Federal court, (c) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and (d) agrees that a final judgment in any such
suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each of the parties hereto agrees that service of process, summons, notice or document by
registered mail addressed to you or us at the addresses set forth above shall be effective service of process for any suit, action or proceeding brought in any such court.
16
We hereby notify you that pursuant to the requirements of the USA PATRIOT Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)) (the PATRIOT Act) and the requirements of 31 C.F.R. § 1010.230 (the Beneficial Ownership
Regulation), each of us and each of the Lenders may be required to obtain, verify and record information that identifies the Borrower and the Guarantors, which information may include their names, addresses, tax identification numbers
and other information that will allow each of us and the Lenders to identify the Borrower, the Target, Holdings and the other Guarantors in accordance with the PATRIOT Act or the Beneficial Ownership Regulation, as applicable. This notice is given
in accordance with the requirements of the PATRIOT Act and is effective for each of us and the Lenders. You hereby acknowledge and agree that the Lead Arrangers shall be permitted to share any and all such information with the Lenders.
The indemnification, compensation (if applicable), reimbursement (if applicable), syndication, jurisdiction, governing law, venue, waiver of
jury trial and confidentiality provisions contained herein and in the Fee Letter and the provisions of Section 8 of this Commitment Letter shall remain in full force and effect regardless of whether Facilities Documentation shall be executed
and delivered and notwithstanding the termination or expiration of this Commitment Letter or the Initial Lenders commitments hereunder; provided that your obligations under this Commitment Letter (except as specifically set forth in the
third through seventh paragraphs of Section 3 and the penultimate sentence of Section 4, and other than your obligations with respect to the confidentiality of the Fee Letter and the contents thereof) shall automatically terminate and be
superseded by the provisions of the applicable Facilities Documentation (to the extent covered therein) upon the initial funding thereunder, and you shall automatically be released from all liability in connection therewith at such time. You may
terminate this Commitment Letter and/or the Initial Lenders commitments with respect to any of the Facilities (or any portion thereof) hereunder at any time subject to the provisions of the preceding sentence (any such commitment termination
shall reduce the commitments of each Initial Lender on a pro rata basis based on their respective commitments to the relevant Facility as of the date hereof); provided, that (i) in the event that one or more of the asset sales disclosed
to the Lead Arrangers prior to the Original Signing Date (the Specified Asset Sales) are consummated prior to the Closing Date, the commitments of the Initial Lenders in respect of the Initial Term A Facility shall be
reduced in an amount equal to (a) the Net Proceeds (as such term is defined in the Existing Wildcat Credit Agreement) of such Specified Asset Sales less (b) to the extent that any or all of the Net Proceeds of the Target are prohibited or
delayed beyond the Closing Date by any requirement of law or contract from being repatriated or distributed to the Target, an amount equal to the portion of such Net Proceeds so affected (it being understood that, after the Closing Date, the
provisions in the Credit Facilities Documentation with respect to mandatory prepayments with the Net Proceeds of asset sales shall apply to such affected Net Proceeds) (with such reduction to be on a pro rata basis among the Initial Lenders) and
(ii) any other reductions of the Initial Lenders commitments in respect of the Initial Term A Facility shall be on a pro rata or greater than pro rata basis with any reductions of commitments in respect of the Initial Term B Facility.
Section headings used herein are for convenience of reference only and are not to affect the construction of, or to be taken into
consideration in interpreting, this Commitment Letter.
If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms of this Commitment Letter and of the Fee Letter by returning to the Commitment Parties (or their legal counsel on behalf of the Commitment Parties), executed counterparts hereof and of the Fee Letter not later than 11:59
p.m., New York City time, on April 20, 2024. The Initial Lenders respective commitments and the obligations of the Commitment Parties hereunder will expire at such time in the
17
event that the Commitment Parties (or their legal counsel) have not received such executed counterparts in accordance with the immediately preceding sentence. If you do so execute and deliver to
us this Commitment Letter and the Fee Letter at or prior to such time, we agree to hold our commitment to provide the Credit Facilities and our other undertakings in connection with the Facilities available for you until the earliest of
(i) after execution and delivery of the Acquisition Agreement and prior to the consummation of the Transactions, the termination of the Acquisition Agreement by you in a signed writing in accordance with its terms, (ii) the consummation of
the Acquisition without the funding of the Credit Facilities and (iii) 11:59 p.m., New York City time on the date that is five business days after the Outside Date (as defined in the Acquisition Agreement as in effect as of the Original Signing
Date, but without giving effect to any extensions pursuant thereto) (such earliest time, the Expiration Date). Upon the occurrence of any of the events referred to in the preceding sentence, this Commitment Letter and the
commitments of the Commitment Parties hereunder and the agreement of the Commitment Parties to provide the services described herein shall automatically terminate unless the Commitment Parties shall, in their sole discretion, agree to an extension
in writing. The termination of any commitment pursuant to this paragraph will not prejudice your rights and remedies in respect of any breach or repudiation of this Commitment Letter.
[Remainder of this page intentionally left blank]
18
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
JPMORGAN CHASE BANK, N.A. |
|
|
By: |
|
/s/ Inderjeet Aneja |
|
|
Name: Inderjeet Aneja |
|
|
Title: Executive Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
MORGAN STANLEY SENIOR FUNDING, INC. |
|
|
By: |
|
/s/ Mara MacDonald |
|
|
Name: Mara MacDonald |
|
|
Title: Executive Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
BANK OF AMERICA, N.A. |
|
|
By: |
|
/s/ Scott Tolchin |
|
|
Name: Scott Tolchin |
|
|
Title: Managing Director |
|
BOFA SECURITIES, INC. |
|
|
By: |
|
/s/ Scott Tolchin |
|
|
Name: Scott Tolchin |
|
|
Title: Managing Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
GOLDMAN SACHS BANK USA |
|
|
By: |
|
/s/ Robert Ehudin |
|
|
Name: Robert Ehudin |
|
|
Title: Authorized Signatory |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
BARCLAYS BANK PLC |
|
|
By: |
|
/s/ Jeremy Hazan |
|
|
Name: Jeremy Hazan |
|
|
Title: Managing Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
DEUTSCHE BANK AG NEW YORK BRANCH |
|
|
By: |
|
/s/ Celine Catherin |
|
|
Name: Celine Catherin |
|
|
Title: Managing Director |
|
|
By: |
|
/s/ Manfred Affenzeller |
|
|
Name: Manfred Affenzeller |
|
|
Title: Managing Director |
|
DEUTSCHE BANK SECURITIES INC. |
|
|
By: |
|
/s/ Celine Catherin |
|
|
Name: Celine Catherin |
|
|
Title: Managing Director |
|
|
By: |
|
/s/ Manfred Affenzeller |
|
|
Name: Manfred Affenzeller |
|
|
Title: Managing Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
ROYAL BANK OF CANADA |
|
|
By: |
|
/s/ Charles D. Smith |
|
|
Name: Charles D. Smith |
|
|
Title: Co-Head, U.S. Leveraged Finance |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
WELLS FARGO BANK, NATIONAL ASSOCIATION |
|
|
By: |
|
/s/ Nicholas Grocholski |
|
|
Name: Nicholas Grocholski |
|
|
Title: Managing Director |
|
WELLS FARGO SECURITIES, LLC |
|
|
By: |
|
/s/ Marc Birenbaum |
|
|
Name: Marc Birenbaum |
|
|
Title: Managing Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
CITIGROUP GLOBAL MARKETS INC. |
|
|
By: |
|
/s/ Bechar Hamdan |
|
|
Name: Bechar Hamdan |
|
|
Title: Director |
[Signature Page to Project Wildcat Commitment Letter]
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
|
|
|
Very truly yours, |
|
HSBC BANK USA, NATIONAL ASSOCIATION |
|
|
By: |
|
/s/ David Barth |
|
|
Name: David Barth |
|
|
Title: Managing Director |
|
HSBC SECURITIES (USA) INC. |
|
|
By: |
|
/s/ David Barth |
|
|
Name: David Barth |
|
|
Title: Managing Director |
[Signature Page to Project Wildcat Commitment Letter]
|
|
|
Accepted and agreed to as of |
the date first above written: |
|
WILDCAT EGH HOLDCO, L.P. |
|
|
By: |
|
SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
|
|
By: |
|
SLTA VII (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: |
|
Egon Durban |
Title: |
|
Co-CEO |
[Signature Page to Project Wildcat Commitment Letter]
EXHIBIT A
Project Wildcat
Transaction Description
Capitalized terms used but not defined in this Exhibit A shall have the meanings set forth in the other Exhibits to the Commitment Letter to
which this Exhibit A is attached (the Commitment Letter) or in the Commitment Letter. In the case of any such capitalized term that is subject to multiple and differing definitions, the appropriate meaning thereof in this
Exhibit A shall be determined by reference to the context in which it is used.
Wildcat EGH Holdco, L.P., a limited partnership organized
under the laws of the State of Delaware (Buyer or Holdco Parent) and Wildcat OpCo Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (OpCo
Parent), were formed at the direction of Silver Lake Partners and its affiliates (collectively, with the funds partnerships, co-investment entities and other investment vehicles managed, advised
or controlled thereby or by one or more directors thereof or under common control therewith, Silver Lake) and the Preferred Investors (as defined below) (together with Silver Lake, the Sponsors).
Pursuant to an Agreement and Plan of Merger, dated as of the Original Signing Date (together with all exhibits, schedules and other disclosure letters thereto, collectively, as amended, the Acquisition Agreement), by and
among Holdco Parent, OpCo Parent, Wildcat PubCo Merger Sub, Inc., a corporation organized under the laws of the State of Delaware and wholly-owned subsidiary of Holdco Parent (Company Merger Sub), Wildcat OpCo Merger Sub,
L.L.C., a limited liability company organized under the laws of the State of Delaware and wholly-owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Company Merger Sub, the Merger
Subs and each, a Merger Sub and the Merger Subs, together with Holdco Parent and OpCo Parent, the Buyer Entities), a company previously identified to us and code-named
Wildcat (the Company or the Target), and a subsidiary of the Company (the OpCo and, together with the Company, the Company Entities
and each, a Company Entity), (i) Company Merger Sub will merge with and into the Target (the Company Merger), with the Target being the surviving entity of the Company Merger and (ii) OpCo
Merger Sub will merge with and into the OpCo (the OpCo Merger and, together with the Company Merger, the Mergers), with the OpCo being the surviving entity of the OpCo Merger, whereby
(A) Holdco Parent will acquire, directly or indirectly, the equity interests of the Company from the equity holders thereof (collectively, the Company Sellers) and, indirectly, the equity interests of OpCo owned by
the Company and (B) OpCo Parent will acquire certain equity interests of the OpCo from the equity holders thereof (collectively, the OpCo Sellers and, together with the Company Sellers, the
Sellers). Other than certain Sellers who may be given the opportunity to retain, rollover or reinvest capital stock, restricted stock units, profits interests and/or options into the Company and/or OpCo (including certain
members of the management of the Company and its subsidiaries) (the Rollover Investors), the Sellers will receive cash (the Acquisition Consideration) in exchange for their capital stock,
restricted stock units, profits interests and/or options in the Company Entities. Immediately after giving effect to the Mergers and the other Transactions, the Company will be a wholly-owned direct subsidiary of Holdco Parent and OpCo will be
owned, collectively, directly or indirectly, by the Rollover Investors, Holdco Parent and OpCo Parent.
In connection with the foregoing,
it is intended that:
|
a) |
A newly formed corporation, limited liability company or limited partnership and indirect parent of Holdings
established by Silver Lake will issue to the initial purchasers (the Preferred Investors) under that certain preferred equity commitment letter dated as of the Original Signing Date (the Preferred Equity
Commitment Letter) newly issued shares of a class of preferred equity with an initial stated value of $1,000 per share (such shares the Preferred Equity) and in an aggregate initial stated value of up to
$500 million (the Preferred Equity Issuance). |
|
b) |
The Sponsors and certain other investors (including certain Rollover Investors) arranged by and/or designated
by the Sponsors (collectively with the Sponsors, the Investors) will directly or indirectly make cash equity contributions to the Buyer Entities (provided that any such contribution to Merger Sub in a form other than
common equity shall be reasonably satisfactory to the Required Lead Arrangers and, provided, further that the Required Lead Arrangers confirm the terms of the Preferred Equity are satisfactory) (the foregoing cash equity contributions
to the Buyer Entities (which, for the avoidance of doubt, shall include any Preferred Equity Issuance), collectively, the Equity Contribution), in an aggregate amount equal to, when combined with the fair market value of
any capital stock or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions (as defined below) and the proceeds of any Preferred Equity Issuance, at least 35% of the sum of (1) the
aggregate gross proceeds of the Facilities borrowed on the Closing Date, excluding the aggregate gross proceeds of (A) any Loans (as defined in Exhibit B to the Commitment Letter) to fund original issue discount and/or upfront fees in
connection with the exercise of the Market Flex Provisions under the Fee Letter and (B) any Revolving Loans (as defined in Exhibit B to the Commitment Letter) to fund any working capital needs on the Closing Date and (2) the
equity capitalization of the Borrower (as defined in Exhibit B to the Commitment Letter) and its subsidiaries on the Closing Date after giving effect to all of the Transactions (the Minimum Equity Contribution);
provided that, if applicable, to the extent any stockholder or other equity holder of the Target has exercised appraisal rights in connection with the Transactions, then on the Closing Date the Investors may elect to issue one or more equity
commitment letters and/or arrange for one or more letters of credit to be issued on their behalf in an aggregate amount not less than the amount of consideration that would otherwise be paid under the Acquisition Agreement in respect of the shares
or other equity interests subject to such appraisal rights (the Appraisal Shares) and, for purposes of this Commitment Letter, an aggregate amount of such equity commitment letters and/or letters of credit up to, but not in
excess of, the amount of consideration that would otherwise be paid under the Acquisition Agreement in respect of the Appraisal Shares shall be included in the amount and percentage of the Equity Contribution from and after the Closing Date as if
such amount was funded in cash (with it being understood that, on or prior to the date of the final resolution of all such appraisal rights, the lesser of (a) the amount necessary to satisfy such appraisal rights in full and (b) an amount
equal to the full amount committed under such equity commitment letters and/or the face value of any such letters of credit shall be funded, directly or indirectly, in cash to the Borrower in the form of common equity, or other equity on terms
reasonably acceptable to the Required Lead Arrangers); provided, further that, the Sponsors will control a majority of the voting equity of Holdings as of the Closing Date. |
|
c) |
The Borrower will obtain (i) up to $4,250 million under a senior secured term loan A facility
described in Exhibit B to the Commitment Letter (the Initial Term A Facility), (ii) up to $2,750 million under a senior secured term loan B facility described in Exhibit B to the Commitment Letter (the
Initial Term B Facility), (iii) up to $250 million under a senior secured revolving credit facility described in Exhibit B to the Commitment Letter (the Revolving Facility) and
(iv) up to $1,500 million under a senior secured 364-day term loan facility described in Exhibit B to the Commitment Letter (the Margin Bridge Facility and, collectively
with the Initial Term A Facility and the Initial Term B Facility, the Initial Term Facilities; the Initial Term Facilities and the Revolving Facility, collectively, the Credit Facilities), which
such Margin Bridge Facility shall be reduced by the aggregate principal amount of any loans funded under the Margin Loan Facility on the Closing Date. |
|
d) |
The Margin Loan Borrower will seek to obtain up to $1,500 million under a margin loan facility described
in Exhibit C to the Commitment Letter (the Margin Loan Facility and, together with the Credit Facilities, the Facilities). |
|
e) |
All principal, accrued, but unpaid interest, fees and other amounts (other than contingent obligations not then
due and payable) outstanding on the Closing Date under the First Lien Credit Agreement, dated as of May 6, 2014 (as amended and restated by Amendment No. 5, dated as of May 18, 2018, and as further amended, supplemented or otherwise
modified from time to time, the Existing Wildcat Credit Agreement and, together with the Existing Tiger Credit Agreement, the Existing Credit Agreements), by and among the WME IMG Holdings, LLC,
William Morris Endeavor Entertainment, LLC, as borrower, IMG Worldwide Holdings, LLC, as co-borrower, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the
other parties thereto shall be repaid in full in connection with, and substantially concurrently with the closing of, the Transactions, and all commitments to lend and guarantees and security in connection therewith shall have been terminated and/or
released or customary arrangements for such termination and/or release have been agreed upon with the administrative agent (the Refinancing). |
|
f) |
The proceeds of the Equity Contribution (including any Preferred Equity Issuance), the Facilities and/or a
portion of the cash on hand at the Target and its subsidiaries on the Closing Date will be applied to pay (i) the Acquisition Consideration, (ii) for the Refinancing and (iii) the fees and expenses incurred in connection with the
Transactions (such fees and expenses, the Transaction Costs, and the amounts set forth in clauses (i) through (iii) above, collectively, the Acquisition Funds). |
The transactions described above (including the payment of Transaction Costs) are collectively referred to herein as the
Transactions.
EXHIBIT B
Project Wildcat
Credit
Facilities
Summary of Principal Terms and Conditions2
|
|
|
Borrower: |
|
A newly formed limited liability company organized under the laws of the United States or any state thereof and an indirect subsidiary of the Target. |
|
|
Transactions: |
|
As set forth in Exhibit A to the Commitment Letter. |
|
|
Administrative Agent and Collateral Agent: |
|
JPM will act as sole administrative agent and sole collateral agent (in such capacities, the Administrative Agent) for a syndicate of banks, financial institutions and other institutional lenders and
investors reasonably acceptable to the Lead Arrangers and the Borrower, excluding any Disqualified Lender (together with the Initial Lenders, the Lenders), and will perform the duties customarily associated with such
roles. |
|
|
Lead Arrangers and Joint Bookrunners: |
|
Each of JPM, MSSF, BofA Securities, Goldman Sachs, Barclays, DB, RBCCM, Wells Fargo Securities, Citi and HSBC Securities will act as a lead arranger (each in such capacity, a Lead Arranger and, together,
the Lead Arrangers), and each of JPM, MSSF, BofA Securities, Goldman Sachs, Barclays, DB, RBCCM, Wells Fargo Securities, Citi and HSBC Securities will act as a bookrunner (each in such capacity, a Joint
Bookrunner and, together, the Joint Bookrunners), in each case for the Credit Facilities, and each will perform the duties customarily associated with such roles. |
|
|
Other Agents: |
|
The Borrower may designate Lead Arrangers or their affiliates to act as syndication agent, documentation agent or co-documentation agent as provided in the Commitment Letter. |
|
|
Credit Facilities: |
|
(A) A senior secured seven-year term loan B facility (the Initial Term B Facility and together with any Incremental
Term Facility (as defined below) that is a term loan B facility, each a Term B Facility) in an aggregate principal amount of up to $2,750 million plus, at the Borrowers election, an amount sufficient to fund any
original issue discount or upfront fees required to be funded in connection with the Market Flex Provisions in the Fee Letter. The loans under the Initial Term B Facility are referred to as the Initial Term B
Loans and the loans under any Term B Facility are referred to as the Term B Loans. The Lenders holding Term B Loans are referred to as the Term B Lenders.
(B) A senior secured three-year term loan A facility (the Initial Term A
Facility and, together with any Incremental Term Facility that is a term loan A facility, each a Term A Facility) in an aggregate principal amount of up to $4,250 million. The loans under the Initial Term
A Facility are referred to as the Initial Term A Loans; the loans under any Term A Facility are referred to as the Term A Loans. The Lenders holding Term A Loans are referred to as the
Term A Lenders. |
2 |
All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to
which this Term Sheet is attached, including Exhibits A, C and D thereto. |
B-1
|
|
|
|
|
(C) A senior secured five-year revolving facility (the Revolving Facility) in an aggregate principal amount of up
to $250 million. The loans under the Revolving Facility are referred to as the Revolving Loans and, together with the Term Loans, the Loans, and the commitments under the Revolving Facility
are referred to as the Revolving Commitments. The Lenders with Revolving Commitments are referred to as the Revolving Lenders.
(D) A senior secured 364-day term loan facility
(the Margin Bridge Facility and, collectively with the Initial Term A Facility and the Initial Term B Facility, the Initial Term Facilities; the Initial Term Facilities, together with any
Incremental Term Facility, the Term Facilities) in an aggregate principal amount of up to (i) $1,500 million minus (ii) the aggregate principal amount of any Margin Loans funded on the Closing Date. The
loans under the Margin Bridge Facility are referred to as the Margin Bridge Loans, and, collectively with the Initial Term A Loans, the Initial Term B Loans and any Incremental Term Loans, the Term
Loans. The Lenders holding Margin Bridge Loans are referred to as the Margin Bridge Lenders and, collectively with the Term B Lenders and the Term A Lenders, the Term Lenders;
the Term Lenders, together with the Revolving Lenders, the Lenders. |
|
|
Incremental Facilities: |
|
The Credit Facilities Documentation will permit the Borrower or any Subsidiary Guarantor (as defined below) to add one or more incremental term loan facilities under the Credit Facilities Documentation or to increase any existing
term loan facility (each, an Incremental Term Facility and the loans under any Incremental Term Facility, the Incremental Term Loans) and/or increase any of the Revolving Commitments (any such
increase, an Incremental Revolving Increase) and/or add one or more incremental revolving credit facility tranches (each, an Incremental Revolving Facility; the Incremental Term Facilities, the
Incremental Revolving Increases and the Incremental Revolving Facilities (and, in each case, the commitments in respect thereof) are collectively referred to as Incremental Facilities) in an aggregate amount not to exceed
the sum of (A) (x) the greater of (1) $1,180 million and (2) 100% of Consolidated EBITDA (to be defined as provided under Financial Definitions below) for the last four fiscal quarters of the Borrower for which financial
statements are available (such greater amount, the Incremental Starter Amount) less (y) the aggregate amount of any Incremental Equivalent Debt (as defined below) incurred in reliance on the equivalent threshold as set
forth in this clause (A) plus (B) all voluntary prepayments of the Term Facilities (other than the Margin Bridge Facility) (including all repayments or purchases made at a discount to par (in an amount equal to the principal amount of such
repayment)) and voluntary prepayments of Revolving Loans to the extent accompanied by a permanent reduction of the Revolving Commitments thereunder, in each case, made prior to such date of incurrence and not funded with the proceeds of long-term
debt plus (C) an amount equal to the amount of indebtedness that is permitted to be incurred in reliance on the General Debt Basket (as defined below) (this clause (C), the General Debt Basket Incremental
Component) plus (D) an additional amount such that, after giving effect to the incurrence of any such Incremental Facility pursuant to this clause (D) (which shall assume that all such indebtedness was secured on a first lien
basis, whether or not so secured, and which shall be deemed to include the full amount of any Incremental Revolving Increase or Incremental Revolving Facility assuming that the full amount of such increase or Incremental Revolving Facility, as
applicable, had been drawn, and after giving effect to any acquisition consummated concurrently therewith and any other acquisition, disposition, debt incurrence, debt retirement and other appropriate pro forma adjustment events, including any debt
incurrence (but without giving effect to any amount incurred simultaneously under either (1) clause (A), (B) or |
B-2
|
|
|
|
|
(C) above or (2) the Revolving Facility) or retirement subsequent to the end of the applicable test period and on or prior to the
date of such incurrence, all to be further defined in the Credit Facilities Documentation), the Borrower would be in compliance, on a pro forma basis (and without netting any cash proceeds of such incurrence), with a First Lien Leverage Ratio (to be
defined as provided under Financial Definitions below) (recomputed as of the last day of the most recently ended fiscal quarter of the Borrower for which financial statements are available) equal to or less than either (x) (A) until
the aggregate expected net proceeds (as determined in good faith by the Borrower) of all non-ordinary course asset sales publicly announced following the Original Signing Date exceeds $2,000 million (the
Asset Sale Threshold), 4.25:1.00 and (B) thereafter, 4.75:1.00 or (y) the First Lien Leverage Ratio immediately prior to the incurrence of such Incremental Facility (the Incremental No Worse
Prong) (this clause (D), the Leverage Based Incremental Amount); provided that:
(i) no event of default (except in connection with permitted acquisitions or other investments, where no payment
or bankruptcy event of default will be the standard) under the Credit Facilities Documentation has occurred and is continuing or would exist after giving effect thereto;
(ii) the maturity date of any such Incremental Term Facility (x) prior to the date on which the
Initial Term A Facility has been repaid in full and except with respect to any customary bridge facilities, shall be no earlier than the maturity date of the Initial Term A Facility and the weighted average life of any such Incremental Term Facility
shall not be shorter than the then remaining weighted average life of the Initial Term A Facility and (y) shall be no earlier than the latest maturity date of the Initial Term B Facility and the weighted average life of any such Incremental
Term Facility shall not be shorter than the remaining weighted average life of the Initial Term B Facility, and the maturity date of any such Incremental Revolving Facility shall be no earlier than the maturity date of the Initial Revolving
Facility; provided that, at the option of the Borrower, this clause (ii)(y) shall not apply to (A) Incremental Facilities in an aggregate outstanding principal amount of up to the greater of (x) $1,180 million and (y) 100% of
Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are available of Incremental Facilities (the Incremental Maturity Carveout), (B) customary bridge facilities or
(C) Incremental Term Facilities incurred in connection with an investment or acquisition;
(iii) the currency, pricing, interest rate margins, discounts, premiums, rate floors and fees and
(subject to clause (ii) above) maturity and amortization schedule applicable to any Incremental Term Facility or Incremental Revolving Facility shall be determined by the Borrower and the lenders thereunder; provided that only during the
period commencing on the Closing Date and ending on the date that is six months after the Closing Date (the MFN Sunset Date) and only with respect to any Incremental Term Facilities in the form of broadly syndicated U.S.
dollar-denominated term B loans that are incurred pursuant to clause (A) and/or (B) above (other than Incremental Term Loans incurred in reliance on any portion of clause (B) thereof that is attributable to permanent commitment
reductions of revolving credit facilities) that are secured by liens on the Collateral ranking equal in priority with the liens on the Collateral securing the Secured Obligations and mature on or prior to the maturity date of the
Initial |
B-3
|
|
|
|
|
Term B Facility, and except (1) with respect to Incremental Term Facilities incurred in connection with an
investment or an acquisition (the MFN Acquisition/Investment Carveout) and (2) with respect to Incremental Term Facilities incurred pursuant to clause (A) and/or (B) above in an aggregate principal amount of
up to the greater of (x) $1,180 million and (y) 100% of Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are available (the MFN Amount Carveout), in the event that
the interest rate margins for any such Incremental Term Facility are higher than the interest rate margins for the Initial Term B Facility by more than 100 basis points (the MFN Cushion), then the interest rate margins for
the Initial Term B Facility shall be increased to the extent necessary so that such interest rate margins are equal to the interest rate margins for such Incremental Term Facility minus 100 basis points; provided, further, that, in
determining the interest rate margins applicable to any Incremental Term Facility and the Initial Term B Facility (A) OID or upfront fees (which shall be deemed to constitute like amounts of OID) or other fees payable by the Borrower to the
Lenders under the Initial Term B Facility or any Incremental Term Facility in the initial primary syndication thereof, if any, shall be included (with OID or upfront fees being equated to interest based on assumed four-year life to maturity), (B)
arrangement, structuring, ticking, commitment, amendment, unused line or underwriting fees or other similar fees payable in connection with the Initial Term B Facility or such Incremental Term Loans, as applicable, consent fees for an amendment (in
each case regardless of whether such fees are paid to or shared in whole or in part with any lender) and such other fees not paid to all relevant lenders generally with respect to such indebtedness shall be excluded, (C) the applicable interest
rate margins shall be deemed to include any credit spread or similar adjustment applicable to a one-month Term SOFR borrowing and (D) (1) to the extent that Term SOFR for a three-month interest period on
the closing date of any such Incremental Term Facility is less than the Term SOFR floor for the Initial Term B Facility, the amount of such difference shall be deemed added to the interest margin for the Initial Term B Facility, solely for the
purpose of determining whether an increase in the interest rate margins for the Initial Term B Facility shall be required and (2) with respect to any Incremental Term Facility, to the extent that Term SOFR applicable to such Incremental Term
Facility for a three-month interest period on the closing date of any such Incremental Term Facility is less than the interest rate floor, if any, applicable to any such Incremental Term Facility, the amount of such difference shall be deemed added
to the interest rate margins for the loans under the Incremental Term Facility solely for the purpose of determining whether an increase in the interest rate margins for the Initial Term B Facility shall be required (collectively, the
MFN Protection);
(iv) any Incremental Term Facility or any Incremental Revolving Facility shall be on terms and pursuant to
documentation to be determined; provided that, to the extent such terms and documentation are not consistent with the Initial Term Facilities or Initial Revolving Facility, as the case may be (except to the extent permitted by clause
(ii) or (iii) above), they shall be reasonably satisfactory to the Administrative Agent (it being understood that, to the extent that any financial maintenance or other covenant is added for the benefit of any (A) Incremental Term
Facility, no consent shall be required from the Administrative Agent or any of the Lenders to the extent that such financial maintenance or |
B-4
|
|
|
|
|
other covenant is (1) also added for the benefit of any existing Facility or (2) only applicable after the
latest maturity of any existing Facility); or (B) any Incremental Revolving Facility, no consent shall be required from the Administrative Agent or any of the Lenders to the extent that such financial maintenance or other covenant is
(1) also added for the benefit of the Initial Revolving Facility or (2) only applicable after the latest maturity of any existing Facility); and
(v) (a) any Incremental Facility that is secured shall only be secured by the Collateral and
(b) no Incremental Facility shall be guaranteed by entities other than the Guarantors or the Borrower.
The Borrower or the applicable Subsidiary Guarantor may (but is not obligated to) seek commitments in respect of the Incremental Facilities from existing
Lenders (each of which shall be entitled to agree or decline to participate in its sole discretion) and from additional banks, financial institutions and other institutional lenders or investors who will become Lenders in connection therewith
(Additional Lenders); provided that (i) the Administrative Agent shall have consent rights (not to be unreasonably withheld) with respect to such Additional Lender, if such consent would be required under the
heading Assignments and Participations for an assignment of loans or commitments, as applicable, to such Additional Lender, (ii) solely with respect to any Incremental Revolving Increase, the Issuing Banks (as defined in the Credit
Facilities Precedent Documentation) shall have consent rights (not to be unreasonably withheld) with respect to such Additional Lender, if such consent would be required under the heading Assignments and Participations for an assignment
of revolving loans or commitments, as applicable, to such Additional Lender and (iii) the restrictions applicable to Affiliated Lenders (to be defined in accordance with the Documentation Considerations) under Assignments and
Participations shall apply to commitments in respect of Incremental Facilities. |
|
|
Refinancing Facilities: |
|
The Credit Facilities Documentation will permit the Borrower or any Guarantor to refinance loans or commitments (including by extending the maturity) under the Facilities or loans or commitments under any Incremental Facility on
terms and conditions substantially consistent with the Credit Facilities Precedent Documentation (as defined below) after giving effect to Documentation Considerations (the Refinancing Indebtedness). |
|
|
Purpose: |
|
(A) The proceeds of borrowings under the Initial Term Facilities will be used by the
Borrower and its subsidiaries, together with the proceeds from borrowings under the Revolving Facility, the proceeds from the Margin Loan Facility and cash on hand at the Target and its subsidiaries, to pay the Acquisition Funds (including, at the
Borrowers election, to fund original issue discount (OID) or upfront fees required pursuant to the Market Flex Provisions in the Fee Letter) to the extent otherwise permitted above and may be used after
the Closing Date for working capital or other general corporate purposes and any other use not prohibited by the Credit Facilities Documentation.
(B) The letters of credit and proceeds of Revolving Loans (except as set forth below) may be used by the
Borrower and its subsidiaries for working capital and other general corporate purposes, including the financing of permitted acquisitions and other permitted investments and permitted dividends and other distributions on account of the capital stock
of the Borrower (or any direct or indirect parent company thereof) and any other use not prohibited by the Credit Facilities Documentation, and, subject to the limitations set forth under Availability below, to finance a portion of the
Acquisition Funds. |
B-5
|
|
|
|
|
(C) The proceeds of any Incremental Facility may be used by the Borrower and its
subsidiaries for working capital and other general corporate purposes, including the financing of permitted acquisitions, other permitted investments and dividends and other permitted distributions on account of the capital stock of the Borrower (or
any direct or indirect parent company thereof) and any other use not prohibited by the Credit Facilities Documentation. |
|
|
Availability: |
|
The Initial Term Facilities will be available in a single drawing on the Closing Date. Amounts borrowed under the Initial Term Facilities
that are repaid or prepaid may not be reborrowed. The Revolving Facility will be
available on (subject to the limitations set forth in the next two succeeding sentences) and after the Closing Date and at any time prior to the final maturity of the Revolving Facility. The Revolving Facility (exclusive of letter of credit usage)
will be made available on the Closing Date in an amount sufficient to fund (i) any OID or upfront fees required to be funded on the Closing Date pursuant to the Market Flex Provisions in the Fee Letter, plus (ii) any ordinary
course working capital requirements of the Borrower and its subsidiaries on the Closing Date, plus (iii) refinance any outstanding amounts under the revolving facility under the Existing Wildcat Credit Agreement, plus (iv) Acquisition
Funds in an aggregate amount, in the case of this clause (iv), not to exceed $75 million. Additionally, letters of credit issued under facilities and other credit support no longer available to the Target or its subsidiaries as of the Closing
Date may be rolled over on the Closing Date and/or new letters of credit may be issued on the Closing Date in order to, among other things, backstop or replace any such credit support outstanding on the Closing Date under such
facilities. Otherwise, letters of credit and Revolving Loans will be available at any time prior to the final maturity of the Revolving Facility, in minimum principal amounts to be agreed upon. Amounts repaid under the Revolving Facility may be
reborrowed. The Revolving Facility shall permit drawings of ABR loans (as defined in Annex I) on same day notice if received by the Administrative Agent prior to 12:00 p.m. New York time. |
|
|
Interest Rates and Fees: |
|
As set forth on Annex I hereto. |
|
|
Default Rate: |
|
During the continuance of a payment or bankruptcy event of default, with respect to overdue principal, at the applicable interest rate plus 2.00% per annum, and with respect to any other overdue amount (including overdue interest),
at the interest rate applicable to ABR loans plus 2.00% per annum, which, in each case, shall be payable on demand. |
|
|
Letters of Credit: |
|
An aggregate amount not to exceed an amount to be agreed of the Revolving Facility will be available to the Borrower for the purpose of issuing letters of credit on terms and conditions consistent with those set forth in the Credit
Facilities Precedent Documentation; provided that MSSF shall not be required to issue any letter of credit that is not a standby letter of credit. |
B-6
|
|
|
Final Maturity and Amortization: |
|
The Initial Term B Facility will mature on the date that is seven years after the Closing Date and will amortize in equal quarterly
installments in aggregate annual amounts equal to 1.00% of the original principal amount of the Initial Term B Facility, commencing with the second full fiscal quarter after the Closing Date, with the balance payable on the maturity date
thereof. The Initial Term A Facility will mature on the date that is three years
after the Closing Date and will amortize in equal quarterly installments in aggregate annual amounts equal to 2.50% of the original principal amount of the Initial Term A Facility, commencing with the second full fiscal quarter after the Closing
Date, with the balance payable on the maturity date thereof. The Margin Bridge
Facility will mature on the date that is 364 days after the Closing Date. The Margin Bridge Facility will have no required amortization.
The Revolving Facility will mature, and the Revolving Commitments will terminate, on the date that is five years after the Closing Date.
The Credit Facilities Documentation shall contain customary amend and extend
provisions pursuant to which individual Lenders may agree to extend the maturity date of their outstanding Initial Term Loans, loans under any Incremental Facility or Revolving Commitments (which may include, among other things, an increase in the
interest rate payable in respect of such extended Term Loans, loans under any Incremental Facility or Revolving Commitments, with such extensions not subject to any default stoppers, financial tests or most favored nation
pricing provisions) upon the request of the Borrower and without the consent of any other Lender (it is understood that (i) no existing Lender will have any obligation to commit to any such extension and (ii) each Lender under the class
being extended shall have the opportunity to participate in such extension on the same terms and conditions as each other Lender under such class). |
|
|
Guarantees: |
|
All obligations of the Borrower (the Credit Facilities Obligations) under the Credit Facilities and, at the election of the Borrower, all obligations of Holdings (as defined below) or any
restricted subsidiary of Holdings under any interest rate protection, foreign exchange or other swap or hedging arrangements (other than any obligation of any Guarantor to pay or perform under any agreement, contract, or transaction that constitutes
a swap within the meaning of section 1a(47) of the Commodity Exchange Act (a Swap), if, and to the extent that, all or a portion of the guarantee by such Guarantor of, or the grant by such Guarantor of a
security interest to secure, such Swap (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation, or order of the Commodity Futures Trading Commission (or the application or official interpretation of
any thereof) (collectively, Excluded Swap Obligations)) and cash management arrangements, in each case entered into with a Lender, Lead Arranger, Joint Bookrunner, the Administrative Agent, any affiliate of a Lender, Lead
Arranger, Joint Bookrunner or the Credit Facilities Administrative Agent or, upon notice to the Administrative Agent, any other person (Hedging/Cash Management Arrangements) will be unconditionally and irrevocably
guaranteed jointly and severally on a senior basis (the Guarantees) by each existing and subsequently acquired or organized direct or indirect wholly-owned U.S. restricted subsidiary of the Borrower (the
Subsidiary Guarantors) and by the direct parent company of the Borrower (Holdings and, together with the Subsidiary Guarantors, the Guarantors); provided that
Subsidiary Guarantors shall not include (a) unrestricted |
B-7
|
|
|
|
|
subsidiaries, (b) immaterial or other excluded subsidiaries (to be defined in a mutually acceptable manner), (c) any subsidiary that is prohibited by applicable law, rule or regulation or by any contractual obligation existing
on the Closing Date or on the date any such subsidiary is acquired (so long as in respect of any such contractual prohibition such prohibition is not incurred in contemplation of such acquisition), in each case from guaranteeing the Credit
Facilities or which would require governmental (including regulatory) consent, approval, license or authorization to provide a Guarantee, or for which the provision of a Guarantee would result in a material adverse tax consequence (including as a
result of the operation of Section 956 of the Internal Revenue Code of 1986, as amended (the IRS Code) or any similar law or regulation in any applicable jurisdiction) to Holdings or one of its subsidiaries (as
reasonably determined by the Borrower in consultation with the Administrative Agent), (d) any direct or indirect U.S. subsidiary of a non-U.S. subsidiary of the Borrower that is a controlled foreign
corporation within the meaning of Section 957 of the IRS Code (a CFC) and any direct or indirect subsidiary of the Borrower that has no material assets other than equity and/or indebtedness of one or more CFCs
(any such entity, a FSHCO) and (e) any not-for-profit subsidiaries, captive insurance companies, receivables subsidiaries or other special
purpose subsidiaries (including, for the avoidance of doubt, the Margin Loan Borrower and any other obligor in respect of the Margin Loan Facility). Neither the Target nor any of its subsidiaries will be Guarantors prior to the consummation of the
Acquisition and the initial funding of the Credit Facilities on the Closing Date. |
|
|
|
|
Notwithstanding the foregoing, subsidiaries may be excluded from the guarantee requirements in circumstances where the Administrative Agent and the Borrower reasonably agree that the cost of providing such a guarantee is excessive
in relation to the value afforded thereby. |
|
|
Security: |
|
Subject to the limitations set forth below in this section and subject to the Limited Conditionality Provisions, the Credit Facilities Obligations, the Hedging/Cash Management Arrangements and the Guarantees in respect of the Credit
Facilities Obligations (collectively, the Credit Facilities Secured Obligations) will be secured on a first priority basis by: (a) a perfected first-priority pledge of 100% of the equity interests of the Borrower and
the Margin Loan Borrower and 100% of the equity interests of each direct, wholly-owned material restricted subsidiary of the Borrower and of each Subsidiary Guarantor (which pledge, in the case of capital stock of any
non-U.S. subsidiary or any FSHCO, shall be limited to 65% of any voting capital stock and 100% of the non-voting capital stock of such first-tier material non-U.S. subsidiary or FSHCO) and (b) perfected first priority security interests in substantially all tangible and intangible personal property of the Borrower and each Subsidiary Guarantor (including but not
limited to accounts receivable, inventory, equipment, general intangibles (including contract rights), investment property, U.S. intellectual property, intercompany notes, instruments, chattel paper and documents, letter of credit rights, commercial
tort claims and proceeds of the foregoing) (the items described in clauses (a) and (b) above, but excluding the Excluded Assets (as defined in the Credit Facilities Precedent Documentation; provided that such definition shall be modified
to expressly include as Excluded Assets all equity interests in TKO Operating Company LLC and TKO Group Holdings, Inc. (collectively the Tiger Equity Interests)), collectively, the Collateral). The
pledges of and security interests in the Collateral granted by the Borrower and each Guarantor shall secure its own respective Credit Facilities Secured Obligations. For the avoidance of doubt, margin stock shall be an Excluded Asset. |
B-8
|
|
|
|
|
All the above-described pledges and security interests shall be created on terms substantially similar to those set forth in the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations; and
none of the Collateral shall be subject to other pledges or security interests, other than with respect to certain customary permitted encumbrances and other exceptions and baskets to be set forth in the Credit Facilities Documentation,
substantially similar to the exceptions and baskets set forth in the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations. |
|
|
Mandatory Prepayments: |
|
Loans under the Credit Facilities and, to the extent required thereunder, under any Incremental Term Facility shall be prepaid with: |
|
|
|
|
(A) solely with respect to the Initial Term B Facility, commencing with the first
full fiscal year of the Borrower to occur after the Closing Date, an amount equal to 50% of Excess Cash Flow (as defined in the Credit Facilities Precedent Documentation and as further reduced on a dollar-for-dollar basis in a manner consistent with the Credit Facilities Precedent Documentation) (the ECF Prepayment Amount), with step-downs to 25% and 0% based upon the
achievement and maintenance of First Lien Leverage Ratios equal to or less than 4.00:1.00 and 3.50:1.00, respectively; provided that any such dollar-for-dollar
reductions that have not been applied to reduce the ECF Prepayment Amount in any fiscal year may be carried over to subsequent fiscal years and applied to reduce the ECF Prepayment Amount in respect of such subsequent fiscal years until such time as
such amounts have been used to reduce any such ECF Prepayment Amount; provided, further, that prepayments shall only be required under this clause if the ECF Prepayment Amount in any fiscal year is greater than the greater of (1)
$200 million and (2) 15% of Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are available (and only amounts in excess of such amount shall be required to be prepaid) (the ECF
Sweep Threshold); |
|
|
|
|
(B) solely with respect to the Initial Term A Facility, an amount equal to 100% of
the net cash proceeds of any non-ordinary course asset sales; provided that prepayments shall only be required for individual asset sales in excess of $25 million; provided, further,
that the aggregate amount of non-ordinary course asset sales excluded from the prepayment requirements pursuant to the foregoing shall not exceed $100 million; |
|
|
|
|
(C) on and after the date on which the Initial Term A Facility has been repaid in
full, with respect to the Initial Term B Facility, an amount equal to 100% (with step-downs to 50% and 0% based upon the achievement and maintenance of First Lien Leverage Ratios equal to or less than 4.00:1.00 and 3.50:1.00, respectively (the
Asset Sale Step-downs) of the net cash proceeds (which shall be calculated in a manner consistent with the Credit Facilities Precedent Documentation) of non-ordinary course sales or
other dispositions of assets constituting Collateral by the Borrower and its restricted subsidiaries after the Closing Date (including insurance and condemnation proceeds and sale leaseback proceeds) in excess of an amount to be agreed made pursuant
to clause (b) under the heading Permitted Asset Sales below and otherwise consistent with such provisions in the Credit Facilities Precedent Documentation; in the case of asset sales or dispositions pursuant to clause (b)(x) in
Permitted Asset Sales below, subject to the rights of |
B-9
|
|
|
|
|
the Borrower and its restricted subsidiaries to reinvest 100% of such
proceeds, if such proceeds are reinvested (or committed to be reinvested) within 540 days of the receipt of such net cash proceeds and, if so committed to reinvestment, reinvested no later than 180 days after the end of such 540-day period and other exceptions to be set forth in the Credit Facilities Documentation; provided that the Borrower may elect to deem expenditures that otherwise would be permissible reinvestments that
occur up to 180 days prior to receipt of the proceeds of an asset sale to have been reinvested in accordance with the provisions hereof; |
|
|
|
|
(D) an amount equal to 100% of the net cash proceeds of issuances of debt obligations
of the Borrower and its restricted subsidiaries after the Closing Date (other than debt permitted under the Credit Facilities Documentation, except in respect of Refinancing Indebtedness); and |
|
|
|
|
(E) solely with respect to the Margin Bridge Facility, (i) to the extent that
the Margin Loan Facility is not funded on the Closing Date, an amount equal to 100% of the net cash proceeds of loans funded under the Margin Loan Facility, (ii) an amount equal to 100% of the net cash proceeds of any sales of Tiger Equity
Interests after making any payments required with respect to the Margin Loan Facility and (iii) an amount equal to 100% of the net cash proceeds of any Incremental Facilities or Incremental Equivalent Debt, other than, in each case, customary
bridge facilities or to the extent incurred in connection with an acquisition or similar investment. |
|
|
|
|
Mandatory prepayments shall be applied, without premium or penalty (i) with respect to clause (A) above, amongst the Initial Term B Facility and any Incremental Term Facility as selected by the Borrower, (ii) with
respect to clause (B) above, to the Initial Term A Facility, (iii) with respect to clause (C) above, to the Initial Term B Facilities and any Incremental Term Facility, and within each class of such Facilities as selected by the
Borrower, (iv) with respect to clause (D) above, amongst the Initial Term Facilities and any Incremental Term Facility as selected by the Borrower (except with respect to Refinancing Indebtedness), (v) with respect to clause
(E) above, to the Margin Bridge Facility and (vi) at the Borrowers direction to the amortization payments scheduled to occur under the Term Facilities and any Incremental Term Facility. |
|
|
|
|
Notwithstanding the foregoing, the Credit Facilities Documentation will provide that, in the event that any Refinancing Indebtedness or any other indebtedness, including any Incremental Equivalent Debt, that is secured on an equal
priority basis (but without regard to the control of remedies) with the liens on the Collateral securing the Facilities (collectively, Additional First Lien Debt), shall be issued or incurred, such Additional First Lien
Debt may share no more than ratably in any prepayments required by the foregoing provisions of clauses (A) and/or (C) to the extent required by the terms of the documentation for such Additional First Lien Debt. |
|
|
|
|
Prepayments attributable to non-U.S. subsidiaries Excess Cash Flow and asset sale or other disposition proceeds will be limited under the Credit Facilities Documentation to the extent
the repatriation of such amounts would result in material adverse tax consequences or would be prohibited or restricted by applicable law, rule or regulation in a manner consistent with the Credit Facilities Precedent
Documentation. |
B-10
|
|
|
|
|
Any Term Lender may elect not to accept its pro rata portion of any mandatory prepayment other than a prepayment described in clause
(D) above (each a Declining Lender). Any prepayment amount declined (such amount, a Declined Amount) by a Declining Lender under the Term Facilities (including any Incremental Term Facility)
may be retained by the Borrower and its restricted subsidiaries and shall increase the Available Amount Basket (as defined below).
The loans under the Revolving Facility shall be prepaid and the letters of credit cash collateralized to the extent such extensions of credit exceed the amount
of the commitments under the Revolving Facility. |
|
|
Voluntary Prepayments and Reductions in Commitments: |
|
Voluntary reductions of the unutilized portion of the Revolving Commitments and voluntary prepayments of borrowings under the Term Facilities
will be permitted at any time, in minimum principal amounts to be agreed, without premium or penalty (other than as set forth in the second succeeding paragraph).
All voluntary prepayments of the Term Facilities and any Incremental Facility will be applied to the remaining amortization payments under the Term Facilities
or such Incremental Facility as directed by the Borrower (and absent such direction, in direct order of maturity thereof), including to any class of extending or existing Term Loans in such order as the Borrower may designate, and shall be applied
to any of the Credit Facilities or any Incremental Facility as determined by the Borrower.
Any voluntary prepayment or refinancing (other than a refinancing of the Initial Term B Facility in connection with any transaction that would, if consummated,
constitute a change of control, initial public offering, Material Acquisition (as defined below), Material Disposition (as defined below) or an increase in the aggregate principal amount of Term B Loans (including by adding a new Class of Term
B Loans) (the Facility Upsize)) of the Initial Term B Facility with other broadly syndicated U.S. dollar-denominated term loan B financings under credit facilities with a lower Effective Yield (as defined below) than the
Effective Yield of the Initial Term B Facility, or any amendment (other than an amendment of the Initial Term B Facility in connection with any transaction that would, if consummated, constitute a change of control, initial public offering, Material
Acquisition, Material Disposition or a Facility Upsize that reduces the Effective Yield of the Initial Term B Facility, in either case that occurs prior to the date that is six months following the Closing Date (the Soft Call
Date) and the primary purpose of which is to lower the Effective Yield on the Initial Term B Facility, shall be subject to a prepayment premium of 1.00% of the principal amount of the Initial Term B Facility so prepaid, refinanced or
amended (collectively, the Soft Call Protection). For the purposes of this paragraph, (i) Material Acquisition shall mean any acquisition by the Borrower or any restricted subsidiary for
consideration (including any assumed indebtedness) in an aggregate amount equal to or greater than the lesser of $300 million and 25% of Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are
available, (ii) Material Disposition shall mean any disposition by the Borrower or any restricted subsidiary for consideration (including any assumed indebtedness) in an aggregate amount equal to or greater than the lesser
of $300 million and 25% of Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are available and (iii) Effective Yield shall mean, as of any date of determination, the
sum of (a) the higher of (A) the Term SOFR rate on such date for a deposit in dollars with a maturity of one month and (B) the Term SOFR floor, if any, with respect thereto as of such date, (b) the interest rate margins as of
such date (with such interest rate margin and interest spreads to be determined by reference to the Term SOFR rate) and (c) the amount of OID and upfront fees thereon (converted to yield assuming a four-year average life and without any present
value discount). |
B-11
|
|
|
Conditions to Initial Borrowing: |
|
Subject to the Limited Conditionality Provisions, the availability of the initial borrowing and other extensions of credit under the Credit Facilities on the Closing Date will be subject solely to (a) delivery of a customary
borrowing/issuance notice; provided that such notice shall not include any representation or statement as to the absence (or existence) of any default or event of default, (b) the accuracy of the Specified Representations in all material
respects (subject to the Limited Conditionality Provisions); provided that any representations and warranties qualified by materiality shall be, as so qualified, accurate in all respects, (c) the accuracy of the Specified Acquisition
Agreement Representations in all material respects; provided that any representations and warranties qualified by materiality shall be, as so qualified, accurate in all respects, and (d) the applicable conditions expressly set forth in
Exhibit D to the Commitment Letter. |
|
|
Conditions to All Subsequent Borrowings: |
|
After the Closing Date, the making of each extension of credit under the Revolving Facility shall be conditioned upon (a) delivery of a customary borrowing/issuance notice, (b) the accuracy of representations and
warranties in all material respects; provided that any representations and warranties qualified by materiality shall be, as so qualified, accurate in all respects and (c) the absence of defaults or events of default at the time of, and
after giving effect to the making of, such extension of credit. |
|
|
Credit Facilities Documentation: |
|
The definitive financing documentation for the Credit Facilities (the Credit Facilities Documentation) shall be under a single credit agreement and shall be initially drafted by counsel for the Sponsor and
contain the terms set forth in this Exhibit B (subject to the right of the Required Lead Arrangers, as applicable, to exercise the Market Flex Provisions under the Fee Letter) and, to the extent any other terms are not expressly set
forth in this Exhibit B, will (a) be negotiated in good faith within a reasonable time period to be determined based on the expected Closing Date in coordination with the Acquisition Agreement, and taking into account the timing of the
syndication of the Initial Term Facilities, (b) be no less favorable to the Borrower and its subsidiaries than the Existing Credit Agreements and (c) contain only those conditions, representations, events of default and covenants set forth
in this Exhibit B and such other terms (but no other conditions) as the Borrower and the Lead Arrangers shall reasonably agree; it being understood and agreed that the Credit Facilities Documentation shall be based on, and substantially consistent
with that certain Credit Agreement, dated as of June 28, 2023 (as amended, supplemented or otherwise modified through the Original Signing Date, the Credit Facilities Precedent Documentation), among Quartz
Intermediate, LLC, Quartz AcquireCo, LLC and JPMorgan Chase Bank, N.A., administrative and collateral agent, and the other banks, agents, financial institutions and other parties thereto (and the related security, pledge, collateral and guarantee
agreements executed and/or delivered in connection therewith and the forms of intercreditor agreements attached thereto), as modified by the terms set forth herein and subject to (i) materiality qualifications and other exceptions that give
effect to and/or permit the Transactions, (ii) certain baskets, thresholds and exceptions that are to be agreed in light of the Consolidated EBITDA and leverage level of the Borrower and its subsidiaries (after giving effect to the
Transactions), (iii) such other modifications to reflect the operational and strategic requirements of Holdings and its subsidiaries (after giving effect to the Transactions) in light of their size, industry (and risks and trends associated
therewith), geographic locations, businesses, business practices, operations, total assets, financial |
B-12
|
|
|
|
|
accounting and the Projections, (iv) modifications to reflect changes in law or accounting standards since the date of the Credit Facilities Precedent Documentation and (v) modifications to reflect reasonable
administrative, agency and operational requirements of the Administrative Agent, (vi) modifications to reflect the financial model provided to the Lead Arrangers on January 31, 2024 (the Sponsor Model) and the
quality of earnings report provided to the Lead Arrangers on January 18, 2024 (the QofE Report) (collectively, the Documentation Considerations). For the avoidance of doubt, the Credit
Facilities Documentation will include bail-in provisions consistent with the Credit Facilities Precedent Documentation. |
|
|
Limited Condition Transactions: |
|
For purposes of (i) determining compliance with any provision of the Credit Facilities Documentation which requires the calculation of
the First Lien Leverage Ratio, the Secured Leverage Ratio (as defined in the Credit Facilities Precedent Documentation, subject to Financial Definitions below), the Total Leverage Ratio (as defined in the Credit Facilities Precedent
Documentation, subject to Financial Definitions below) or the Interest Coverage Ratio (as defined in the Credit Facilities Precedent Documentation, subject to Financial Definitions below), (ii) determining compliance with
representations, warranties, defaults or events of default or (iii) testing availability under baskets set forth in the Credit Facilities Documentation (including baskets measured as a percentage of Consolidated EBITDA), in each case, in
connection with a Limited Condition Transaction, at the option of the Borrower (the Borrowers election to exercise such option in connection with any Limited Condition Transaction, an LCT Election), the date of
determination of whether any such action is permitted hereunder, shall be deemed to be, as applicable, the date the definitive agreements or letters of intent for such Limited Condition Transaction are entered into, or the date of delivery of
irrevocable notice or a dividend declaration with respect to, such Limited Condition Transaction (such date, the LCT Test Date), and if, after giving pro forma effect to the Limited Condition Transaction and the other
transactions to be entered into in connection therewith as if they had occurred at the beginning of the most recent test period ending prior to the LCT Test Date, the Borrower or a restricted subsidiary could have taken such action on the relevant
LCT Test Date in compliance with such ratio or basket, such ratio or basket shall be deemed to have been complied with.
Limited Condition Transaction shall mean (i) an acquisition or other investment by one or more of the Borrower and its
restricted subsidiaries of any assets, business or person permitted by the Credit Facilities Documentation, (ii) any repayment, repurchase or refinancing of indebtedness with respect to which an irrevocable notice of repayment (or similar
irrevocable notice) is required to be delivered and (iii) any dividends or distributions on, or redemptions of, equity interests not prohibited by the Credit Facilities Documentation declared or requiring irrevocable notice in advance
thereof. For the avoidance of doubt, if the Borrower has made an LCT Election and
any of the ratios or baskets for which compliance was determined or tested as of the LCT Test Date (including with respect to the incurrence of any Indebtedness) are exceeded as a result of fluctuations in any such ratio or basket (including due to
fluctuations in pro forma Consolidated EBITDA, including of the target of any Limited Condition Transaction) at or prior to the consummation of the relevant transaction or action, such baskets or ratios will not be deemed to have been exceeded as a
result of such fluctuations; however, if any ratios improve or baskets increase as a result of such fluctuations, such improved ratios or baskets may be utilized. If the Borrower has made an LCT Election for any Limited Condition Transaction, then
in connection with any subsequent calculation of |
B-13
|
|
|
|
|
any ratio or basket on or following the relevant LCT Test Date and prior to the earlier of (i) the date on which such Limited Condition Transaction is consummated or (ii) the date that the definitive agreement for such
Limited Condition Transaction is terminated or expires without consummation of such Limited Condition Transaction, any such ratio or basket shall be calculated on a pro forma basis assuming such Limited Condition Transaction and other transactions
in connection therewith (including any incurrence of debt and the use of proceeds thereof) have been consummated. |
|
|
Representations and Warranties: |
|
Subject to the Limited Conditionality Provisions, limited on the Closing Date to the Specified Representations and the Specified Acquisition Agreement Representations and thereafter to the representations and warranties set forth in
Article III of the Credit Facilities Precedent Documentation (to be applicable to Holdings, the Borrower and its restricted subsidiaries only and subject, where applicable, to qualifications and limitations for materiality consistent with those
provided in the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations). |
|
|
|
|
Material Adverse Effect shall (a) on the Closing Date, have the meaning ascribed to such term in the Acquisition Agreement, and (b) thereafter, have the meaning ascribed to such term in the Credit
Facilities Precedent Documentation. |
|
|
Affirmative Covenants: |
|
Subject in all respects to the Documentation Considerations, to be applicable to the Borrower and its restricted subsidiaries only, the same (including, for the avoidance of doubt, with respect to materiality qualifiers, exceptions
and limitations) as the affirmative covenants set forth in Article V of the Credit Facilities Precedent Documentation; provided that the Credit Facilities Documentation shall provide that (i) audited annual financial statements shall be
delivered within 120 days (or, in the case of the first fiscal year ending after the Closing Date, 150 days) of the last day of each fiscal year, (ii) unaudited quarterly financial statements shall be delivered within 60 days (or, in the case
of the first three fiscal quarters ending after the Closing Date, 90 days) of the last day of each of the first three fiscal quarters and (iii) prior to an IPO, the Borrower shall deliver an annual budget within the time period required for
delivery of audited annual financial statements. |
|
|
Negative Covenants: |
|
Limited to the following (to be applicable to the Borrower and its restricted subsidiaries): |
|
|
|
|
a) limitations on the incurrence of debt (which shall permit, among other things,
(i) the indebtedness under the Credit Facilities (including Incremental Facilities) and any permitted refinancing thereof, (ii) non-speculative hedging arrangements, (iii) indebtedness
(including indebtedness under the Existing Tiger Credit Agreement and Ordinary Course Indebtedness) of the Target and its subsidiaries incurred prior to the Closing Date which remains outstanding and is permitted to remain outstanding under the
Acquisition Agreement and any permitted refinancings of the foregoing, (iv) any secured or unsecured notes or loans issued by the Borrower or a Guarantor in lieu of the Incremental Facilities (such loans or notes, Incremental
Equivalent Debt); provided that (A) the incurrence of such indebtedness shall result in a dollar-for-dollar reduction of the amount of
indebtedness that the Borrower and the Guarantors may incur in respect of the Incremental Facilities and the other requirements related to the incurrence of the Incremental Facilities shall be satisfied (other than those set forth in the proviso to
clause (iii) and in clauses (iv) and (v) of such requirements); provided, however, |
B-14
|
|
|
|
|
that, in the case of any Incremental Equivalent Debt consisting of
junior priority secured notes or loans, in lieu of compliance with the First Lien Secured Leverage Ratio test set forth in the first paragraph under Incremental Facilities, the Borrower shall instead be in compliance, on a pro forma
basis (and without netting any cash proceeds of such incurrence), with either (x) a Senior Secured Leverage Ratio (to be defined as provided under Financial Definitions below) (recomputed as of the last day of the most recently
ended fiscal quarter of the Borrower for which financial statements are available) equal to or less than either (i) 6.50:1.00 or (ii) the Senior Secured Leverage Ratio immediately prior to the incurrence of such Incremental Equivalent Debt (the
Junior Debt Leverage No Worse Prong) or (y) an Interest Coverage Ratio of not less than either (i) 1.75:1.00 or (ii) the Interest Coverage Ratio immediately prior to the incurrence of such Incremental Equivalent
Debt (this clause (ii), the Junior Debt ICR No Worse Prong), (B) to the extent secured, such indebtedness shall be subject to any applicable intercreditor agreement and (C) the terms and conditions of such Incremental
Equivalent Debt (excluding pricing, rate floors, discounts, fees, premiums and prepayment or redemption provisions) either (I) are not materially more favorable (when taken as a whole) to the lenders or investors providing such Incremental
Equivalent Debt than the terms and conditions of the Credit Facilities Documentation (when taken as a whole) are to the Lenders (it being understood that, to the extent that any financial maintenance covenant or any other covenant is added for the
benefit of any Incremental Equivalent Debt, no consent shall be required by the Administrative Agent or any of the Lenders if such financial maintenance covenant or other covenant is either (x) also added for the benefit of any corresponding
Loans remaining outstanding after the issuance or incurrence of any such Incremental Equivalent Debt in connection therewith or (y) only applicable after the latest maturity date under the Credit Facilities Documentation at such time), (II)
include covenants or other provisions applicable only to periods after the latest maturity date under the Credit Facilities Documentation at such time or (III) reflect market terms and conditions (taken as a whole) at the time of incurrence of
such Incremental Equivalent Debt (as determined by the Borrower in good faith), (v) Refinancing Indebtedness, (vi) indebtedness assumed in connection with, or otherwise incurred to finance, Permitted Acquisitions and other investments, in each
case, on the terms set forth in the Credit Facilities Precedent Documentation, (vii) purchase money indebtedness and capital leases (x) in an amount to be agreed plus (y) an unlimited amount to finance the purchase, construction and
improvement of fixed or capital assets subject to compliance with a maximum Senior Secured Leverage Ratio (calculated as if such purchase money indebtedness and capital leases are secured by Collateral for these purposes) of no greater than
(A) prior to the date on which the Asset Sale Threshold has been achieved, 4.25:1.00 and (B) on and after the date on which the Asset Sale Threshold has been achieved, 4.75:1.00 (this clause (y), the Capital Lease Ratio
Prong), (viii) indebtedness arising from agreements providing for adjustments of purchase price or earn outs entered into in connection with acquisitions, (ix) a general debt basket in an amount to be agreed and which
may be secured to the extent permitted by exceptions to the lien covenant (the General Debt Basket) less amounts incurred under the General Debt Basket Incremental Component, (x) other senior, senior subordinated or
subordinated indebtedness that is unsecured or that is secured solely by assets that do not constitute Collateral so long as the Borrower is in compliance, on a pro forma basis (and without netting any cash proceeds of such incurrence), with either
(x) a |
B-15
|
|
|
|
|
Total Leverage Ratio (to be defined as provided under Financial
Definitions below) (recomputed as of the last day of the most recently ended fiscal quarter of the Borrower for which financial statements are available) equal to or less than either (i) 7.00:1.00 or (ii) the Total Leverage Ratio
immediately prior to the incurrence of such indebtedness (the Unsecured Debt Leverage No Worse Prong) or (y) an Interest Coverage Ratio of not less than either (i) 1.75:1.00 or (ii) the Interest Coverage Ratio
immediately prior to the incurrence of such indebtedness (this clause (ii), the Unsecured Debt ICR No Worse Prong)), (xi) a subsidiary debt basket for non-Guarantor subsidiaries in an
amount to be agreed, (xii) indebtedness in an amount equal to (A) 200% of any cash common equity contribution to Holdings or the Borrower following the Closing Date (other than Cure Amounts (as defined in the Credit Facilities Precedent
Documentation) and the proceeds of any such Cure Amount that is actually used pursuant to, or that increases, another basket under the Credit Facilities Documentation) to the extent such cash equity contribution shall not be counted for purposes of
the Available Amount Basket and without any time limitation for use of proceeds of such contribution (this clause (xii)(A), the Contribution Debt Basket) plus (B) on and after the date on which (1) the aggregate
principal amount of outstanding Initial Term A Loans is equal to or less than $1,250 million and (2) there are no Margin Bridge Loans then outstanding (the foregoing clauses (1) and (2), collectively, the TLA/MB Covenant
Threshold), the unused amount of any baskets and/or exceptions permitting dividends or distributions on, or redemptions of, the equity of the Borrower (or any direct or indirect parent company thereof) or restricted investments (which
such baskets, for the avoidance of doubt, shall be reduced by the amount of such incurrence on a dollar-for-dollar basis) (this clause (xii)(B), the RP Debt
Basket), (xiii) using the Available Amount Basket as set forth and subject to the conditions in the second succeeding paragraph, (xiv) permitted receivables financings and (xv) other customary exceptions set forth in the
Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations);
b) limitations on liens on Collateral securing indebtedness for borrowed money and on Tiger Equity
Interests (which shall permit, among other things, liens securing (i) any of the Credit Facilities and, in each case, any permitted refinancing thereof, (ii) liens on Tiger Equity Interests securing the Margin Loan Facility and any
permitted refinancing thereof; provided that, except with the consent of Term A Lenders holding a majority of the Initial Term A Loans, until the achievement of the TLA/MB Covenant Threshold, no consensual liens on the Tiger Equity Interests
other than liens permitted by this clause (ii) shall be permitted, (iii) any secured Incremental Equivalent Debt, (iv) Refinancing Indebtedness, (v) debt assumed in connection with a Permitted Acquisition or other investment on
the terms described under the heading Permitted Acquisitions below, (vi) permitted purchase money indebtedness or capital leases in each case permitted to be incurred pursuant to clause (a)(vii) above, (vii) other permitted
debt pursuant to a general lien basket in an amount equal to the General Debt Basket, (viii) permitted non-Guarantor subsidiary debt limited to the assets of
non-Guarantors, (ix) debt incurred using the Available Amount Basket and (ix) other exceptions and qualifications set forth in the Credit Facilities Precedent Documentation, after giving effect to
the Documentation Considerations with incurrence ratios consistent with the debt incurrence ratios above); |
B-16
|
|
|
|
|
c) limitations on fundamental changes;
d) limitations on asset sales
(including sales of subsidiaries) and sale and lease back transactions (which, in each case, shall be permitted (i) on the terms set forth under the heading Permitted Asset Sales below, (ii) pursuant to an annual dollar basket
in an amount equal to the greater of $250 million and 20% of Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are available, with amounts not used in any fiscal year carried forward to
succeeding fiscal years and (iii) subject to the other exceptions and qualifications set forth in the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations);
e) limitations on investments and
acquisitions (which shall be permitted on the terms set forth under Permitted Acquisitions below and, in addition, permit (i) unlimited investments in the Borrower and the restricted subsidiaries, (ii) investments in connection
with the Transactions, (iii) using the Available Amount Basket as set forth and subject to the conditions in the second succeeding paragraph, (iv) to the extent consistent with the Credit Facilities Precedent Documentation, the unused
amount of any baskets and/or exceptions permitting dividends or distributions on, or redemptions of, the equity of the Borrower (or any direct or indirect parent company thereof) or prepayments or redemptions of any subordinated indebtedness owed by
the Borrower or any Guarantor, (v) additional investments subject only to pro forma compliance with a Total Leverage Ratio of 6.00:1.00 (the Leverage Based Investment Exception), (vi) baskets for investments in
unrestricted subsidiaries and similar businesses in amounts to be agreed and (vii) other exceptions and qualifications set forth in the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations);
f) limitations on dividends
or distributions on, or redemptions of the Borrowers (or any of its direct or indirect parent companies) equity (which shall permit, among other things, (i) for any taxable period for which Borrower and/or any of its subsidiaries
are members of a consolidated, combined or unitary tax group for U.S. federal and/or applicable state, local or foreign income tax purposes, or are disregarded entities that are owned directly (or indirectly through other disregarded entities) by
any such members of a consolidated, combined or unitary tax group, in each case for U.S. federal and/or applicable state, local or foreign income tax purposes, of which a direct or indirect parent of Borrower is the common parent (a Tax
Group), distributions in an amount not to exceed the portion of any U.S. federal, state, local or foreign taxes (as applicable) of such Tax Group for such taxable period that are attributable to the income of Borrower and/or its
subsidiaries; provided that dividends or distributions made pursuant to this clause (i) shall (I) not exceed the tax liability that Borrower and/or its subsidiaries (as applicable) would have incurred were such taxes determined as if
such entity(ies) were a stand-alone taxpayer or a stand-alone group, (II) in respect of any taxes attributable to the income of any unrestricted subsidiaries of Borrower may be made only to the extent that such unrestricted subsidiaries have
made cash payments for such purpose to Borrower or its restricted subsidiaries, and (III) be reduced by any amounts paid by Borrower or any of its subsidiaries to the applicable governmental authority in respect of such taxes;
(ii) Holdings, the Borrower or any restricted subsidiary may make dividends or distributions in cash |
B-17
|
|
|
|
|
to Holdings to permit Holdings to make, and Holdings may make,
Restricted Payments in respect of any Permitted Tax Receivables Payments; which shall mean, in respect of a taxable period, cash distributions to the equity holders of Borrower in an aggregate amount that does not exceed
the sum of (x) amounts required to be paid (I) pursuant to that certain Tax Receivable Agreement dated as of April 28, 2021, by and among Endeavor Group Holdings, Inc., Endeavor Manager, LLC, Endeavor Operating Company, LLC, the
several Exchange TRA Parties (as defined therein), the several Reorganization TRA Parties (as defined therein), Representative (as defined therein), the KKR Representative (as defined therein) and SLP West Holdings, L.L.C., as the same may be
amended, restated, amended and restated, supplemented or otherwise modified from time to time (the Existing TRA) and (II) any substantially similar tax receivable agreement among any of the parties to the Existing TRA
entered into prior to the Closing Date; provided that no amounts will be paid pursuant to this clause (II) in duplication of tax attributes for which payments were made in respect of clause (I) and (y) without duplication of amounts
covered by clause (x), the ordinary course payments payable by an entity the interests of which are subsequently issued or otherwise sold pursuant to an IPO (an IPO Entity) pursuant to a customary tax receivable agreement;
provided that, for the avoidance of doubt, ordinary course payments pursuant to a tax receivable agreement means payments other than (A) any accelerated lump sum amount payable by reason of any early termination of such
agreement or otherwise, to the extent such amount exceeds the amount that would have been payable under such tax receivable agreement in the absence of such acceleration or (B) payments after a change in control to the extent in excess of
amounts that would have been payable under the tax receivable agreement if there had been no change of control, (iii) for each taxable year for which Borrower is treated as a partnership or disregarded entity that is owned by a partnership for
U.S. federal income tax purposes, in an amount equal to the sum of the following amount for each member of Holdings or, without duplication, the parent entity of Holdings (A) the taxable income of the Borrower allocated (or allocable) to (plus
any guaranteed payments for U.S. federal income tax purposes taken into account by) such member for the taxable year (in each case, determined after taking into account any tax basis step-up arising from the
Transactions, including pursuant to Section 743 or Section 734 of the Code) multiplied by (B) the maximum combined marginal U.S. federal, state and local income tax rate (after taking into account the deductibility of state and local
income tax for U.S. federal income tax purposes, deductions permitted under Section 199A of the Code, applicable limitations on the deductibility of items, and the character of the income in question (i.e., long term capital gain, qualified
dividend income, etc.)) applicable to any direct (or, where the direct equity holder is a pass-through entity, indirect) equity holder of Holdings for such period; provided that any such distributions shall be reduced by any amounts paid by
any of the Borrower, or its subsidiaries to the applicable governmental authority in respect of such taxes; provided, that for the avoidance of doubt, if the actual aggregate U.S. federal, state and/or local income tax liability of the Tax
Group attributable to the taxable income of Borrower and all associated tax attributes related thereto exceeds the portion of such distribution allocable to the Tax Group that directly or indirectly owns an interest in Borrower, then the
distribution permitted by clause (iii) shall be increased by an amount equal to such excess; provided, further, that any such distributions with respect to any such taxable year may be made in quarterly installments on an
estimated basis to |
B-18
|
|
|
|
|
allow such direct (or indirect) equity holders to pay their estimated
taxes, with any excess of aggregate quarterly distributions with respect to any such taxable year over the actual amount of distributions permitted for such period reducing any such distributions with respect to the immediately subsequent period
(and, to the extent such excess is not fully absorbed in the immediately subsequent period, the following period(s)), (iv) payment of legal, accounting and other ordinary course corporate overhead or other operational expenses of any direct or
indirect parent entity and for the payment of franchise or similar taxes required to maintain organizational existence, (v) subject to no continuing payment or bankruptcy event of default, customary distributions necessary to pay advisory,
refinancing, subsequent transaction and exit fees, and other overhead expenses of direct and indirect parents of the Borrower attributable to the ownership of the Borrower and its subsidiaries, (vi) dividends, distributions or redemptions with
the Available Amount Basket as set forth in the second succeeding paragraph, (vii) a general basket to be agreed, (viii) dividends, distributions or redemptions in connection with the Transactions (including, without limitation, as
necessary to allow any parent company to make payments contemplated or otherwise required by the Acquisition Agreement whether at or after the Closing Date), (ix) the repurchase, retirement or other acquisition or retirement for value of equity
interests (or any options or warrants or stock appreciation or similar rights issued with respect to any of such equity interests) held by any future, present or former employee, director, officer, consultant or other individual service provider (or
any affiliates, spouses, former spouses, other immediate family members, successors, executors, administrators, heirs, legatees or distributees of any of the foregoing) pursuant to any employee, management or director profit interests or equity
plan, employee, management or director stock option plan or any other employee, management or director benefit plan or any agreement with any employee, director, officer, consultant or other individual service provider or otherwise in an amount not
to exceed the greater of an amount to be agreed and a corresponding percentage of Consolidated EBITDA, in any fiscal year; provided that any unused portion for any fiscal year may be carried forward to succeeding fiscal years,
(x) additional dividends, distributions or redemptions, subject only to (A) pro forma compliance with a Total Leverage Ratio of 5.25:1.00 (the Leverage Based RP Exception) (after giving pro forma effect to such
dividend, distribution or redemption and based on the Consolidated EBITDA of the Borrower and its restricted subsidiaries for the most recently ended four fiscal quarter period for which financial statements are available) and (B) no payment or
bankruptcy event of default, (xi) after a qualified IPO, dividends, distributions or redemptions in an amount, on an annual basis, not to exceed the sum of (a) an amount equal to 7.00% of the net proceeds received by (or contributed to)
the Borrower and its restricted subsidiaries from such qualified IPO and any follow on offerings and (b) an amount equal to 8.00% of the market capitalization of Holdings at the time declared and (xii) other exceptions and qualifications
set forth in the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations (including, for the avoidance of doubt, any exceptions set forth in the Existing Credit Agreements, including the exceptions with
respect to Key Employee Distributions, Partially Management Owned Subsidiaries and EA Entity members (each as defined in the Existing Wildcat Credit Agreement); provided that any discretionary dividends or distributions on, or redemptions
pursuant to, clauses (vi), (vii), (ix), (x) and (xi) above shall not be permitted prior to achievement of the TLA/MB Covenant Threshold); |
B-19
|
|
|
|
|
g) limitations on prepayments or redemptions of any subordinated indebtedness owed by
the Borrower or any Guarantor to any entity that is not Holdings, the Borrower or any restricted subsidiary (in an aggregate principal amount exceeding the cross acceleration threshold) (Junior Debt), in each case
consummated earlier than the date that is 12 months prior to the stated maturity date of such Junior Debt, or amendments of the documents governing such Junior Debt in a manner (when taken as a whole) materially adverse to the Lenders (which shall
permit, among other things (i) refinancing or exchanges of Junior Debt for like or other junior debt or, other than in the case of subordinated indebtedness, any unsecured debt, (ii) conversion of Junior Debt to common or qualified
preferred equity, (iii) prepayments or redemptions using the Available Amount Basket as set forth in the second succeeding paragraph, (iv) to the extent consistent with the Credit Facilities Precedent Documentation, the unused amount
of any baskets and/or exceptions permitting dividends or distributions on, or redemptions of, the equity of the Borrower (or any direct or indirect parent company thereof) or restricted investments (which such baskets, for the avoidance of doubt,
shall be reduced by the amount of such incurrence on a dollar-for-dollar basis) and (v) additional prepayments or redemptions, subject only to pro forma compliance
with a Total Leverage Ratio of 5.75:1.00 (the Leverage Based Junior Debt Exception) (after giving pro forma effect to such prepayment or redemption) and based on the Consolidated EBITDA of the Borrower and its restricted
subsidiaries for the most recently ended four fiscal quarter period for which financial statements are available);
h) limitations on negative pledge clauses; and
i) limitations on
transactions with affiliates. |
|
|
|
|
For the avoidance of doubt, unless expressly specified herein, no negative covenant exception shall be subject to a cap on non-Guarantor indebtedness or investments. The
negative covenants will be subject, in the case of each of the foregoing covenants, to exceptions, qualifications and baskets to be set forth in the Credit Facilities Documentation that are substantially consistent with the exceptions,
qualifications and baskets set forth in Credit Facilities Precedent Documentation, but adjusted to reflect the Documentation Considerations, which shall, for the avoidance of doubt, permit classification and reclassification from time to
time by the Borrower among one or more available baskets and exceptions under any such covenants and contain automatic reclassification to ratio-based incurrence exceptions; provided that (x) monetary baskets in the negative covenants
will include in a manner consistent with the Credit Facilities Precedent Documentation basket builders based on a percentage of Consolidated EBITDA of the Borrower and its restricted subsidiaries equivalent to the initial monetary amount of each
such basket and (y) the amount of any basket usage (including any borrowings under any Revolving Facility or under the Incremental Facilities) or other exception not subject to a ratio test made substantially simultaneously with, or
contemporaneously with, any ratio test under the Credit Facilities Documentation will be disregarded when determining pro forma compliance with such ratio. In addition, certain negative covenants shall include an
Available Amount Basket, which shall mean a cumulative amount equal to (a) the greater of (1) $600 million and (2) 50% of |
B-20
|
|
|
|
|
Consolidated EBITDA for the last four fiscal quarters of the Borrower for which financial statements are available (such greater amount, the Starter Basket) plus (b) the greater of (i) 50% of
cumulative Consolidated Net Income (to be defined as provided under Financial Definitions below) and (ii) cumulative Consolidated EBITDA minus 1.5x cumulative Fixed Charges (as defined in the Credit Facilities Precedent
Documentation) (this clause (b), the Builder Basket), plus (c) the Declined Amounts plus (d) the portion of net cash proceeds not required to be applied to prepayments pursuant to clause (C) in
Mandatory Prepayments above as a result of the leverage-based step-downs plus (e) the cash proceeds of new public or private equity issuances of any direct or indirect parent of the Borrower or the Borrower (other than disqualified
stock) actually received in the form of qualified equity, plus (f) capital contributions to the Borrower made in cash or cash equivalents (other than disqualified stock) and the fair market value of any
in-kind contributions, plus (g) the net cash proceeds received by the Borrower and its restricted subsidiaries from debt and disqualified stock issuances that have been issued after the Closing Date and
which have been exchanged or converted into qualified equity, plus (h) returns, profits, distributions and similar amounts received in cash or cash equivalents by the Borrower and its restricted subsidiaries on investments made using the
Available Amount Basket (not to exceed the amount of such investments) or otherwise received from an unrestricted subsidiary (including the net proceeds of any sale, or issuance of stock, of an unrestricted subsidiary), plus (i) the investments
of the Borrower and the restricted subsidiaries in any unrestricted subsidiary that has been re-designated as a restricted subsidiary or that has been merged or consolidated with or into the Borrower or any of
its restricted subsidiaries in an amount equal to the fair market value (as determined in good faith by the Borrower) of the investments of the Borrower and its restricted subsidiaries in such unrestricted subsidiary at the time of such re-designation or merger or consolidation and otherwise defined in a manner consistent with the Credit Facilities Precedent Documentation, after giving effect to the Documentation Considerations. The Available
Amount Basket may be used for indebtedness, liens, investments, dividends and distributions and the prepayment or redemption of Junior Debt; provided that use of the Builder Basket for dividends and distributions shall be subject to the
absence of any continuing payment or bankruptcy event of default. |
|
|
Permitted Asset Sales: |
|
The Borrower or any restricted subsidiary will be permitted to make non-ordinary course of business asset sales or dispositions without limit so long as (a) such sales or dispositions are
for fair market value, (b) at least either (x) 75% of the consideration for asset sales and dispositions, calculated over the period since the Closing Date and through the date of such asset sale or disposition, in excess of an amount to
be agreed shall consist of cash or cash equivalents or (y) 50% of the consideration for asset sales and dispositions, calculated over the period since the Closing Date and through the date of such asset sale or disposition, in excess of an
amount to be agreed shall consist of cash or cash equivalents (in each case, subject to exceptions to be set forth in the Credit Facilities Documentation to be agreed, which shall include a basket in an amount to be agreed for non-cash consideration that may be designated as cash consideration) and (c) to the extent applicable, such asset sale or disposition is subject to the terms set forth in the section entitled Mandatory
Prepayments hereof. |
|
|
Permitted Acquisitions: |
|
The Borrower or any restricted subsidiary will be permitted to make acquisitions of the equity interests in a person that becomes a restricted subsidiary, or all or substantially all of the assets (or all or substantially all the
assets constituting a business unit, division, product line or line of business) of any person (each, a Permitted Acquisition) so long |
B-21
|
|
|
|
|
as (a) after giving effect thereto, no payment or bankruptcy event of default has occurred and is continuing, (b) the acquired company or assets are in the same or a generally related or ancillary line of business as the
Borrower and its subsidiaries and (c) subject to the limitations set forth in Guarantees and Security above, the acquired company and its subsidiaries (other than any subsidiaries of the acquired company designated as an
unrestricted subsidiary as provided in Unrestricted Subsidiaries below) will become Guarantors and pledge their Collateral to the Administrative Agent. Acquisitions of entities that do not become Guarantors will not be limited in any
additional manner. |
|
|
Financial Maintenance Covenant: |
|
With respect to the Term B Facilities and Margin Bridge Facility: None.
With respect to the Term A Facilities and the Revolving Facility: The Credit Facilities
Documentation will contain a maximum First Lien Leverage Ratio with regard to the Borrower and its restricted subsidiaries on a consolidated basis (the Financial Maintenance Covenant), at a level of (x) prior to the
date on which the TLA/MB Covenant Threshold has been achieved, 8.50:1.00, and (y) on and after the date on which the TLA/MB Covenant Threshold has been achieved, 9.50:1.00 (in each case, which First Lien Leverage Ratio shall be appropriately
adjusted to reflect any additional original issue discount or upfront fees required to be funded in connection with the Market Flex Provisions in the Fee Letter) (and with no step-downs).
The foregoing Financial Maintenance Covenant will be tested with respect to the Borrower
and its restricted subsidiaries on a consolidated basis, beginning with the second full fiscal quarter period ending after the Closing Date for which financial statements have been or are required to be delivered, quarterly on the last day of each
fiscal quarter ending after the Closing Date for which financial statements have been or are required to be delivered, and on and after the date on which the Initial Term A Facility have been repaid in full, tested only if, on the last day of such
fiscal quarter, the aggregate outstanding principal amount of Revolving Loans (excluding for the avoidance of doubt, letters of credit whether or not drawn), exceeds 40% of the total amount of the Revolving Commitments (the Testing
Condition). For purposes of determining compliance with the Financial
Maintenance Covenant, the Credit Facilities Documentation shall provide for Cure Rights (as defined in the Credit Facilities Precedent Documentation) that are the same as those set forth in the Precedent Credit Agreement (including, without
limitation, as set forth in Section 7.02 of the Credit Facilities Precedent Documentation). |
|
|
Financial Definitions: |
|
The financial definitions in the Credit Facilities Documentation shall be consistent with the equivalent definitions of such terms in the Credit Facilities Precedent Documentation, after giving effect to Documentation
Considerations, in each case as modified (a) as reasonably agreed to (i) more accurately reflect the business and financial accounting of the Borrower and its subsidiaries after giving effect to the Transactions and (ii) address
technical clarifications adjustments, (b) to include all adjustments and add-backs of the type included in the Sponsor Model (together with all updates and modifications thereto reasonably agreed with the
Required Lead Arrangers) or the QofE Report; provided that (i) there shall be an uncapped addition to Consolidated EBITDA for pro forma run rate cost savings, operating expense reductions, revenue enhancements and synergies
related to the Transactions that are reasonably quantifiable, factually supportable and projected by the Borrower in good faith to result from actions that have been taken or initiated or are expected to be taken (in the good
faith |
B-22
|
|
|
|
|
determination of the Borrower) before or after the Closing Date, (ii) there shall be an uncapped addition to Consolidated EBITDA for pro forma run rate cost savings, operating expense reductions, revenue
enhancements and synergies related to acquisitions, dispositions and other specified transactions, restructurings, cost savings initiatives and other initiatives that are reasonably quantifiable, factually supportable and projected by the Borrower
in good faith to result from actions that have been taken or initiated or are expected to be taken (in the good faith determination of the Borrower) before or after such acquisition, disposition or other specified transaction, restructuring, cost
savings initiative or other initiative and (iii) addbacks and adjustments at least as favorable to the Borrower as those in the Existing Credit Agreements, (c) to include in the Consolidated EBITDA, Consolidated Total Debt and Available
Cash of the Borrower and its restricted subsidiaries, so long as Tiger Holdings remains a Restricted Subsidiary (as such term is defined in the Credit Facilities Precedent Documentation) of the Borrower, a proportional share of the Consolidated
EBITDA, Consolidated Total Debt and Available Cash, respectively, of Tiger Holdings and its subsidiaries, based on the proportion of the economic interests in Tiger Holdings and its subsidiaries directly or indirectly owned by the Borrower (it being
understood that Consolidated First Lien Debt and Consolidated Secured Debt shall be calculated in a manner consistent with the Credit Facilities Precedent Documentation and shall not include indebtedness of Tiger Holdings and its subsidiaries). It
being understood and agreed, for the avoidance of doubt, that all references to a First Lien Leverage Ratio, a Secured Leverage Ratio, a Total Leverage Ratio or an Interest Coverage Ratio, shall be deemed to be references to such ratios as set forth
herein without regard to the amount of Consolidated EBITDA used to market and/or syndicate the Credit Facilities. |
|
|
Unrestricted Subsidiaries: |
|
The Credit Facilities Documentation will contain provisions pursuant to which, subject to limitations on loans, advances, guarantees and other investments in, unrestricted subsidiaries, the Borrower will be permitted to designate
any existing or subsequently acquired or organized subsidiary (other than the Borrower) as an unrestricted subsidiary (with any subsidiary of an unrestricted subsidiary constituting an unrestricted subsidiary) and subsequently re-designate any such unrestricted subsidiary as a restricted subsidiary so long as, after giving effect to any such designation or re-designation, (a) the fair market
value of such subsidiary at the time it is designated as an unrestricted subsidiary shall be treated as an investment by the Borrower at such time and (b) no payment or bankruptcy event of default under the Credit Facilities
Documentation has occurred or is continuing or would exist after giving effect thereto. Unrestricted subsidiaries will not be subject to the representation and warranties, affirmative or negative covenant or event of default provisions of the Credit
Facilities Documentation and the results of operations and indebtedness of unrestricted subsidiaries will not be taken into account for purposes of determining compliance with the financial maintenance covenant contained in the Credit Facilities
Documentation. |
|
|
Events of Default: |
|
The Credit Facilities Documentation will include event of default provisions on terms and conditions substantially consistent with the Credit
Facilities Precedent Documentation after giving effect to the Documentation Consideration.
Notwithstanding the foregoing, (i) only lenders holding at least a majority of the Initial Term A Loans and the Revolving Commitments and Revolving Loans
shall have the ability to (and be required in order to) amend the Financial Maintenance Covenant and waive a breach of the Financial Maintenance Covenant, (ii) a breach of the Financial Maintenance Covenant shall not constitute an event of
default with respect to the Term B |
B-23
|
|
|
|
|
Facilities or the Margin Bridge Facility or trigger a cross-default under the Term B Facilities or Margin Bridge Facility until the date on which the Revolving Commitments have been terminated or the Initial Term A Loans and the
Revolving Loans (if any) have been accelerated by the Initial Term A Lenders and the Revolving Lenders, respectively, in accordance with the terms of the Initial Term A Facility and the Revolving Facility, respectively, (iii) only lenders
holding at least a majority of the Initial Term A Loans and Margin Bridge Loans shall have the ability to (and be required in order to) amend the TLA/MB Covenant Threshold and any restriction based thereon (a TLA/MB
Restriction) and waive a breach of any such TLA/MB Restriction and (iv) a breach of any TLA/MB Restriction shall not constitute an event of default with respect to the Term B Facilities or the Revolving Facility or trigger a
cross-default under the Term B Facilities or Revolving Facility until the date on which the Initial Term A Loans and Margin Bridge Loans have been accelerated by the Initial Term A Lenders and the Margin Bridge Lenders, respectively, in accordance
with the terms of the Initial Term A Facility and the Margin Bridge Facility. |
|
|
Voting: |
|
The Credit Facilities Documentation will include voting provisions on terms and conditions substantially consistent with the Credit
Facilities Precedent Documentation after giving effect to Documentation Considerations (including with respect to the inclusion of the Revolving Facility).
Notwithstanding the foregoing, amendments and waivers of the Financial Maintenance Covenant will be subject to the second paragraph under Events of
Default above. |
|
|
Cost and Yield Protection: |
|
The Credit Facilities Documentation will include cost and yield protection provisions on terms and conditions substantially consistent with the Credit Facilities Precedent Documentation after giving effect to Documentation
Considerations. The Credit Facilities Documentation will include customary provisions with respect to taxes. |
|
|
Assignments and Participations: |
|
The Credit Facilities Documentation will include assignment and participation provisions (including with respect to affiliates of the Borrower) in accordance with the Documentation Considerations on terms and conditions
substantially consistent with the Credit Facilities Precedent Documentation after giving effect to Documentation Considerations. Goldman Sachs shall be permitted to assign its commitments and Term Loans to GSLP (and vice-versa) without any required
consents. |
|
|
Expenses and Indemnification: |
|
The Credit Facilities Documentation will include expense and indemnification provisions on terms and conditions substantially consistent with the Credit Facilities Precedent Documentation after giving effect to Documentation
Considerations. |
|
|
Governing Law and Forum: |
|
New York. |
|
|
Counsel to the Administrative Agent, Lead Arrangers and Joint Bookrunners: |
|
Davis Polk & Wardwell LLP. |
B-24
ANNEX I
|
|
|
Interest Rates: |
|
With respect to the Initial Term B Facility, at the option of the Borrower, Term SOFR plus a margin (the Applicable
Margin) of 4.00% or ABR plus an Applicable Margin of 3.00%. From and
after the delivery by the Borrower to the Administrative Agent of the financial statements for the first full fiscal quarter of the Borrower completed after the Closing Date, interest rate spreads with respect to the Initial Term B Facility shall be
subject to two 25 basis point step-downs at First Lien Leverage Ratios of 4.00:1.00 and 3.50:1.00, respectively (the Term B Leverage Step-downs).
In addition, on and after the date of any initial public offering of the Borrower, Holdings, or any parent entity thereof (an IPO),
the applicable margins at each leverage level in respect of the Initial Term B Facility shall be 25 basis points lower than the Applicable Margins set forth above. |
|
|
|
|
With respect to the Initial Term A Facility, at the option of the Borrower, Term SOFR plus an Applicable Margin of 4.25% or ABR plus an
Applicable Margin of 3.25%. From and after the date on which the TLA Repayment
Threshold is achieved, interest rate spreads with respect to the Initial Term A Facility shall be subject to one 50 basis point step-down.
TLA Repayment Threshold shall mean the termination of commitments with respect to the Initial Term A Facility and/or repayment of
Initial Term A Loans in an aggregate principal amount equal to $2,000 million.
In addition, on and after the date of any IPO, the applicable margins at each leverage level in respect of the Initial Term A Facility shall be 25 basis points
lower than the Applicable Margins set forth above. |
|
|
|
|
With respect to the Margin Bridge Facility, Term SOFR plus an Applicable Margin of 3.75% or ABR plus an Applicable Margin of 2.75%. |
|
|
|
|
With respect to the Revolving Facility, at the option of the Borrower, Term SOFR plus an Applicable Margin of 3.75% or ABR plus an Applicable
Margin of 2.75%. From and after the delivery by the Borrower to the Administrative
Agent of the financial statements for the first full fiscal quarter of the Borrower completed after the Closing Date, interest rate spreads with respect to the Revolving Facility shall be subject to two 25 basis point step-downs at First Lien
Leverage Ratios of 4.00:1.00 and 3.50:1.00, respectively. In addition, on and after
the date of any IPO, the applicable margins at each leverage level in respect of the Revolving Facility shall be 25 basis points lower than the Applicable Margins set forth above. |
|
|
|
|
The Borrower may elect interest periods of 1, 3 or 6 months (or, if agreed by all relevant Lenders, 12 or fewer months or a period of shorter than 1 month) for Term SOFR
borrowings. |
B-I-1
|
|
|
|
|
Calculation of interest shall be on the basis of the actual days elapsed in a year of 360 days (or 365 or 366 days, as the case may be, in the case of ABR loans). |
|
|
|
|
Interest shall be payable in arrears (a) for loans accruing interest at a rate based on Term SOFR, at the end of each interest period and, for interest periods of greater than 3 months, every three months, and on the applicable
maturity date and (b) for loans accruing interest based on the ABR, quarterly in arrears and on the applicable maturity date. |
|
|
|
|
ABR is the Alternate Base Rate, which is the highest of (i) prime commercial lending rate announced by the
Administrative Agent as its prime rate, (ii) the Federal Funds Effective Rate plus 1/2 of 1.0% and (iii) the one-month Term SOFR plus 1.0% per annum.
Term SOFR is the secured overnight financing rate for U.S.
dollars for the relevant interest period. For the avoidance of doubt, Term SOFR shall not include a credit spread adjustment. |
|
|
|
|
There shall be a minimum Term SOFR (i.e., Term SOFR prior to adding any applicable interest rate margins thereto) requirement of 0.00% per annum in respect of the Initial Term Facilities and the Revolving Facility. |
|
|
Letter of Credit Fees: |
|
A per annum fee equal to the Applicable Margin related to Term SOFR loans under the Revolving Facility will accrue on the aggregate face amount of outstanding letters of credit under the Revolving Facility, payable in arrears at the
end of each quarter and upon the termination of the respective letter of credit, in each case for the actual number of days elapsed over a 360-day year. Such fees shall be paid to the Administrative Agent for
distribution to the Revolving Lenders pro rata in accordance with the amount of each such Revolving Lenders Revolving Commitment, with exceptions for defaulting lenders. In addition, the Borrower shall pay to each letter of credit issuer, for
its own account, (a) a fronting fee equal to 0.125% per annum of the aggregate face amount of outstanding letters of credit, payable in arrears at the end of each quarter, at maturity and upon the termination of the respective letter of credit,
calculated based upon the actual number of days elapsed over a 360-day year, and (b) customary issuance and administration fees. |
|
|
Commitment Fees: |
|
The Borrower shall pay a commitment fee of 0.50% per annum on the average daily unused portion of the Revolving Facility, payable quarterly
in arrears, calculated based upon the actual number of days elapsed over a 360-day year. Such fees shall be paid to the Administrative Agent for distribution to the applicable Revolving Lenders pro rata in
accordance with the amount of each such Revolving Lenders applicable Revolving Commitment, with exceptions for defaulting lenders.
From and after the delivery by the Borrower to the Administrative Agent of the Borrowers financial statements for the first full fiscal quarter of the
Borrower completed after the Closing Date, the commitment fee under the Revolving Facility shall be determined by reference to a leverage-based pricing grid with step-downs to 0.375% and 0.25% per annum at First Lien Leverage Ratios of 4.00:1.00 and
3.50:1.00, respectively. |
B-I-2
|
|
|
Duration Fees: |
|
The Borrower will pay a duration fee, for the ratable benefit of the Margin Bridge Lenders, in an amount equal to 0.25% of the aggregate principal amount of Margin Bridge Loans outstanding (if any) on each of the dates which 90
days, 180 days, 270 days and 360 days after the Closing Date, due and payable in cash on such day (or, if such day is not a business day, on the next business day). |
B-I-3
EXHIBIT C
Project Wildcat
Margin
Loan Facility
Summary of Principal Terms and Conditions3
[Attached]
3 |
All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to
which this Term Sheet is attached, including Exhibits A, B and D thereto. |
C-1
Project Wildcat Margin Loan
Summary of Terms and Conditions
|
|
|
Facility |
|
Single term loan facility with multiple initial Lenders. The Facility will be secured by a separate pledge to each Lender of a pro rata portion of the pledged Units and Shares and a separate collateral account for each Lender
(each, a Collateral Account) at the Custodian. There will be a single Administrative Agent and Calculation Agent for the Facility. |
|
|
Administrative Agent |
|
[ ], which will be one of the initial Lenders or an affiliate thereof. If Administrative Agent fails to send an event of default notice, mandatory prepayment notice or a margin call notice when
required, Administrative Agent may be removed by a majority of Lenders and replaced with another original Lender. |
|
|
Calculation Agent |
|
[ ] or an affiliate thereof, as the sole Calculation Agent for the Facility. |
|
|
Custodian |
|
[Deutsche Bank Trust Company Americas] (all Collateral Accounts will be at the Custodian). |
|
|
Margin Loan Borrower |
|
A newly formed special purpose vehicle, which will be a [Delaware limited liability
company]1, formed solely for the purpose of holding the pledged Units and Shares and that has no outstanding indebtedness, liens or other obligations.
Borrowers organizational documents will include customary bankruptcy remoteness
provisions (including the appointment of an independent director); provided that there shall be no requirement to deliver a non-consolidation opinion. Borrower will be 100% owned, directly or indirectly, by
[E] (Parent). |
|
|
Issuer |
|
Tiger Operating Company, LLC and Tiger Group Holdings, Inc. (NYSE) |
|
|
Pledged Units and Shares |
|
a) LLC units in Tiger Operating Company, LLC (Units) and
corresponding non-economic Class B voting shares of Tiger Group Holdings, Inc. (Shares), in an amount sufficient to meet an initial LTV of 30%.
b) Margin Loan Borrower may, at its
option and at any time (including to cure a margin call) pledge additional Units and Shares of Tiger from time to time. Additional Units and Shares pledged after the date of closing of the Facility (the Closing Date) shall
be segregated from any Units and Shares initially pledged on any other date and subject to a 10% haircut for a period of six-months from date of pledge (or, if the Issuer is not current in its reporting, up to
a period of twelve-months from date of pledge).
c) Types and amounts of Collateral will at all times be pledged pro rata among the Lenders. Pledged Units
and Shares may not be rehypothecated.
d) Each Lender will maintain a security interest in its pro rata share of the pledged Units and Shares,
free from any transfer restrictions (other than (i) transfer restrictions relating to Borrowers status as an affiliate of Issuer and the Units and Shares being restricted securities, (ii) transfer restrictions
under Article 2 of the Governance Agreement dated as of September 12, 2023 among the Issuer, Endeavor and other parties thereto and (iii) transfer restrictions under |
1 |
Entity type and jurisdiction of formation TBD. |
C-2
|
|
|
|
|
Section 12 of the Registration Rights Agreement dated as of September 12, 2023 among the Issuer, Endeavor and the
other parties thereto) in each case held in book-entry form at the Issuer or the transfer agent (as applicable); provided that such Lender will agree with Issuer that any sales of the pledged Units and Shares on foreclosure will be effected in
transactions registered under the Securities Act or in transactions that the Lender reasonably believes to be exempt from registration under the Securities Act (subject to the Issuer Agreement). |
|
|
Issuer Agreement |
|
Issuer will enter into a customary agreement with Lenders satisfactory to each Lender. |
|
|
Maturity |
|
5 years from the Closing Date with no scheduled amortization. |
|
|
Loan Amount |
|
Lower of (i) $1.5 billion and (ii) 30% initial LTV. |
|
|
Interest |
|
Prior to Successful Margin Loan Syndication:
S+425bps of Applicable Margin
50% PIK / 50% cash pay (it
being understood that PIKd amounts do not affect Successful Margin Loan Syndication thresholds).
After Successful Margin Loan Syndication:
S+325 bps of Applicable Margin
Unlimited automatic PIK
unless Margin Loan Borrower elects to cash pay. A Successful Margin Loan
Syndication shall be deemed to have occurred when each initial Lender holds unsyndicated loans in the aggregate of not greater than $300 million of the Facility. For the avoidance of doubt, the Commitment Letter to which this term
sheet is attached does not constitute a commitment by any Lender to provide any portion of the Facility even if the definition of Successful Margin Loan Syndication is satisfied. |
|
|
Alternative Collateral |
|
a) Cash.
b) Eligible letter of credit from a commercial bank rated at least
A3/A- with combined capital, surplus and profits of at least $500m.
c) US Treasuries with maturity not greater than one year.
d) Other collateral with
Administrative Agents consent (which shall be granted only with the consent of all other Lenders). |
|
|
Loan-to-Value (LTV) |
|
As of any day, the then current Net Obligations divided by the sum of (i) the Market Value of the pledged Units and (ii) (a) 100% minus the agreed haircut (if any) multiplied by (b) the value of any other collateral
acceptable to Lenders. |
|
|
Net Obligations |
|
The amount, if any, by which the aggregate principal amount (including PIK Interest) of all outstanding loans plus accrued and unpaid interest exceeds the sum of (i) aggregate cash held in the Collateral Accounts, (ii) 99%
of the amount available to be drawn under any eligible letter of credit and (iii) 99% of the aggregate fair market value of any US treasuries held in the Collateral Accounts. |
|
|
Market Value |
|
As of any day, the closing price of the Class A common stock of Issuer on the NYSE (the Exchange) on such day (or if such day is not a trading day, the immediately preceding trading day, subject to
customary provisions with respect to disrupted days consistent with the Documentation Principles) multiplied by the number of Units constituting Collateral on such date. |
C-3
|
|
|
Margin Calls, Prepayment Events and Adjustment Events |
|
|
|
|
Margin Call Level |
|
Prior to Successful Margin Loan Syndication: If LTV is higher than 55% on any single trading day
After Successful Margin Loan Syndication: If LTV is higher than 60% on any single
trading day |
|
|
Margin Reset Level |
|
Prior to Successful Margin Loan Syndication: 45%
After Successful Margin Loan Syndication: 50% |
|
|
Cash Release Level |
|
45%
All dividends and other distributions received on the pledged Units, including any one-time dividends, shall be
credited pro rata to the Collateral Accounts and pledged as additional collateral, subject to release (following any required payments of interest as set forth in PIK Paydown below) if the LTV is less than the Cash Release Level before and
immediately after giving effect to such release, and no default, event of default, Mandatory Prepayment Event or adjustment determination period exists or would exist before and immediately after giving effect to any such release. |
|
|
Share Release Level |
|
45%. |
|
|
Margin Call Cure |
|
Borrower shall, within two (2) Business Days of receipt of any notice from the Calculation Agent of the occurrence of a Margin Call, reduce LTV to Margin Reset Level; provided that such 2 Business Day deadline shall be
extended to the thirteenth (13th) Business Day following the date of such receipt of notice following receipt of a customary capital call confirmation package from the relevant sponsor parent entities (subject to customary diligence by the
Lenders). |
|
|
Mandatory Prepayment Event |
|
Mandatory Prepayment Events will be limited to:
a) Issuer insolvency;
b) Issuer delisting;
c) Issuer trading suspension for 5 consecutive trading days (with haircuts consistent with the ML
Precedent Documentation);
d) Change of control of Margin Loan Borrower;
e) Bona fide announcement of Issuer
merger events consisting of (i) transactions where the Issuer would not be the surviving entity, (ii) reverse mergers above a specified size or (iii) tender offers in respect of 100% of the outstanding shares of the Issuer;
f) the occurrence of a Stock
Price Trigger Event; g) the
occurrence of a Facility Adjustment Event for which no adjustment can be made that would produce a commercially reasonable result.
Mandatory Prepayment Deadline: Borrower shall prepay all loans outstanding within 5 Business Days of receipt of a Mandatory Prepayment Event
Notice from Administrative Agent. |
|
|
Stock Price Trigger Event |
|
If on any trading day, the closing stock price of Issuer is equal to the greater of (i) 25% of the closing stock price of Issuer on the date of the Commitment Letter and (ii) 30% of the share price of Issuer on the Closing
Date. |
C-4
|
|
|
|
|
Collateral Terms |
|
|
|
|
Facility Adjustment Events |
|
Facility Adjustment Events to be the following, after giving effect to the Documentation Principles:
a) customary ISDA equity derivatives
definitions Facility Adjustment Events consistent with the ML Precedent Documentation;
b) imposition of a withholding tax on prospective sales of Class A common stock or exchanges of
Units and Shares for Class A common stock resulting from a change in law or change in jurisdiction of Issuer (provided that commercially reasonable steps were taken to designate another lending office in order to avoid or mitigate such
imposition); c) any change in
the rate at which Units and Shares are exchangeable for shares of Class A common stock;
d) announcement of tender offer in respect of more than 25% of the Free Float (to be defined consistent
with the ML Precedent Documentation) of Issuer;
e) announcement of an Issuer change of control (excluding any change of control resulting from sales by
Borrower or its affiliates, as long as such sales do not result in any person or group other than Parent owning more than 50% of Issuers common stock);
f) any event with a dilutive
or concentrative effect on the theoretical value of shares;
g) material status change or material uncertificated security change requirements;
h) the failure or inability by
Borrower to provide the IRS Form or certification; or
i) any announcement or proposal of any amendment, waiver or modification to the Issuer
organizational documents or the Units (or the occurrence thereof without an announcement or proposal) that could, if consummated or agreed, materially restrict, limit or impair the exercise of the right of the Borrower to exchange Units and Shares
for Class A common stock. Upon the occurrence of a Facility Adjustment Event,
the Calculation Agent may make an adjustment to any term or provision of the Facility to account for the effect thereof on the Facility, provided, that (i) the Required Lenders may propose alternative adjustments within three Business Days of
receiving any notice of the Calculation Agents proposed adjustments and no adjustments shall be made before the earlier of (x) the fifth Business Day following the occurrence of a Facility Adjustment Event and (y) receipt of notice
from Required Lenders with their proposed adjustments or confirmation that they agree with the Calculation Agents proposed adjustments. |
|
|
PIK Paydown |
|
To the extent Borrower or any of its affiliates receives any cash dividend or sale proceeds with respect to pledged Units or Shares, Borrower shall, by the (x) the immediately following Interest Payment Date in the case of
cash dividends and (y) within five (5) Business Days of receipt in the case of sale proceeds, apply such cash proceeds to first, pay accrued and unpaid interest to such day of receipt and second, prepay principal up to an amount equal to
the aggregate outstanding PIK Interest as of such day of receipt until outstanding PIK Interest is reduced to zero. |
C-5
|
|
|
Cash Release |
|
Borrower shall have the ability to release cash from the Collateral Accounts (subject to compliance with PIK Paydown above) if the LTV is less than the Cash Release Level before and immediately after giving effect to
such release and in each case if no default, event of default, Mandatory Prepayment Event or adjustment determination period exists or would exist before and immediately after giving effect to any such release. |
|
|
Permitted Sales |
|
Borrower shall have the ability at any time to release pledged Units and Shares only pro rata for the purpose of settling sales for cash
on a standard settlement cycle; provided that, if the LTV immediately following such release is greater than the Share Release Level, Borrower shall apply the cash proceeds received in connection with such sales to make required payments until the
pro forma LTV is less than the Share Release Level until all such cash proceeds are exhausted (the Prepayment Amount) (it being understood that Borrower shall have no further obligation to make required payments after
application of 100% of all such cash proceeds); provided further that no default, event of default, Mandatory Prepayment Event or adjustment determination period is continuing or would result therefrom.
To facilitate a sale of pledged Shares pursuant to the immediately preceding bullet,
each Lender shall release its liens over the pledged Units and Shares being sold immediately upon receipt of its pro rata share of the Prepayment Amount (if any) and shall if required enter into any reasonably satisfactory escrow or other
arrangement with the selling bank for these purposes. |
|
|
Other Terms |
|
|
|
|
Voluntary Prepayments |
|
Borrower may elect to prepay the loan, in whole or in part, prior to the Maturity Date without premium or penalty, subject to reimbursement for SOFR breakage costs. |
|
|
Future Financings |
|
Neither Borrower nor any affiliate of Borrower may pledge or otherwise encumber Units and Shares that do not constitute pledged Units and Shares to any person to secure any obligation of Borrower or any affiliate of
Borrower. |
|
|
Events of Default |
|
Limited to the following with customary materiality and grace periods to be consistent with the ML Precedent Documentation:
a) Borrower fails to make principal
payments when due. b) Borrower
fails to cure a Margin Call prior to the relevant deadline.
c) Borrower fails to make interest payments when due (subject to a 5 Business Day grace period).
d) Any representation or warranty
made or deemed made by Borrower or in any capital call confirmation package was incorrect in a material respect when made or deemed made.
e) Any failure by Borrower to observe or perform any term, condition or covenant of the Facility (subject
to customary grace periods consistent with the ML Precedent Documentation).
f) Bankruptcy event relating to Borrower (subject in each case to a 60 day grace period for
involuntary events). g) Any
material provision in the Loan Documentation (as defined below) ceases to be valid, binding and enforceable. |
C-6
|
|
|
|
|
h) Failure of a
Lender to have a perfected first priority (subject to permitted liens) security interest in the Collateral or of any security agreement to be in full force and effect.
i) Final judgments against Borrower in excess of $10,000,000 (in the case of monetary judgments)
or that would reasonably be expected to have a material adverse effect (in the case of non-monetary judgments), in each case subject to a 10 day grace period.
j) Borrowers assets
constitute assets of an ERISA plan, resulting in a non-exempt prohibited transaction under ERISA and subjecting Lenders to any tax or penalty.
k) Specified events with respect to
pension plans. |
|
|
Affirmative Covenants |
|
To be customary affirmative covenants consistent with the ML Precedent Documentation and consistent with the Documentation Principles. |
|
|
Negative Covenants |
|
Limited to the following:
a) limitation on the incurrence of debt and liens on its property (which shall permit customary permitted
liens); b) limitation on
business activities;
c) limitation on investments and acquisitions;
d) limitation on distributions of
Collateral or during a default or Event of Default;
e) limitation on Investment Company matters;
f) limitation on amendments
to constituent documents;
g) limitation on transactions with affiliates;
h) limitation on creation of
subsidiaries;
i) limitation on other material agreements;
j) limitation on impairment
of collateral; k) limitation of
violation of margin regulations;
l) sanctions and anti-corruption limitations;
m) limitations on changes of
tax status; n) limitations on
Future Financings;
o) limitations on certain transactions;
p) customary ERISA matters.
Each of the foregoing covenants is subject, where applicable, to exceptions and
qualifications to be provided in the Loan Documentation, which shall be consistent with the qualifications and limitations for materiality provided in the ML Precedent Documentation, after giving effect to the Documentation Principles. |
|
|
Assignments and Participations |
|
Lender may assign or participate a portion of the loan (i) with the consent of (a) Administrative Agent (not to be unreasonably withheld or delayed) and (b) so long as no hard event of default of the
type set forth in clauses (a), (b), (c) or (f) of the Events of Default section above has occurred and is continuing, Borrower in its sole discretion or (ii) if the assignee or participant is listed on a white list to be
agreed, provided that, in all cases, no Lender may make an assignment or participation to any assignee or participant that is a competitor without the consent of Borrower. |
|
|
Voting / Required Lenders |
|
To be consistent with ML Precedent Documentation. |
C-7
|
|
|
|
|
Conditions and Closing Deliverables |
|
Customary conditions and deliverables consistent with the ML Precedent Documentation, including a 30% initial LTV |
|
|
Documentation Principles |
|
The definitive financing documentation for the Facility (the Loan Documentation) will be based on the margin loan documentation for the Project V margin loan transaction (the ML
Precedent Documentation) and substantially consistent with similar equity margin financings for affiliates of top-tier private equity sponsors provided by the relevant lenders and/or other major
nationally recognized banks that typically act as lead arrangers for similar private equity margin loan financings, and will include modifications to reflect the terms contained herein as well as terms and subject to (i) materiality
qualifications and other exceptions and (ii) modifications to reflect changes in law or accounting standards since the date of the Project V documentation. |
|
|
Governing Law |
|
New York. |
|
|
Counsel to Lenders |
|
Davis Polk & Wardwell LLP. |
C-8
EXHIBIT D
Project Wildcat
Summary
of Additional Conditions4
The initial borrowings under the Credit Facilities on
the Closing Date are subject solely to the satisfaction or waiver by the Commitment Parties of the applicable conditions set forth in the section entitled Conditions in the body of the Commitment Letter, the section entitled Conditions to
Initial Borrowing in Exhibit B to the Commitment Letter and the following conditions (subject in all respects to the Limited Conditionality Provisions):
1. Since the date of the Acquisition Agreement, no Material Adverse Effect (as defined in the Acquisition Agreement) shall have occurred and be
continuing that would result in the failure of a condition precedent to your obligation to fund the Acquisition under the Acquisition Agreement or that would give you the right (taking into account any notice and cure provisions) to terminate your
obligations pursuant to the terms of the Acquisition Agreement.
2. The Acquisition shall have been consummated, or substantially
simultaneously with the initial borrowings under the Initial Term Facilities, shall be consummated, in all material respects in accordance with the terms of the Acquisition Agreement, after giving effect to any modifications, amendments, consents or
waivers by Buyer (or any of its affiliates) thereto, other than those modifications, amendments, consents or waivers by Buyer (or its affiliate) that are materially adverse to the interests of the Lenders or the Commitment Parties in their
capacities as such when taken as a whole (it being understood that any modification, amendment, consent or waiver to the definition of Material Adverse Effect shall be deemed to be materially adverse to the interests of the Lenders and the
Commitment Parties), unless consented to in writing by the Required Lead Arrangers (such consent not to be unreasonably withheld, delayed or conditioned); provided that Required Lead Arrangers shall be deemed to have consented to such
amendment, supplement, waiver or modification unless they shall object in writing thereto within three business days of being notified or otherwise becoming aware of such amendment, waiver or modification; provided, further, that any
dispositions permitted under the Acquisition Agreement shall not be deemed materially adverse to the interests of the Lenders or the Commitment Parties in their capacities as such, whether taken individually or in the aggregate; provided,
further, that any modification, amendment or express waiver or consents by Buyer (or its affiliate) that results in (a) a reduction in the Acquisition Consideration shall not be deemed to be materially adverse to the Lenders or the
Commitment Parties if such reduction is applied (i) first to reduce the Equity Contribution to 35% and (ii) thereafter, (I) 65% to reduce the Initial Term A Facility until the amount of commitments in respect of the Initial Term A Facility
is $0, and thereafter to reduce the amount of commitments in respect of the Initial Term B Facility and the Margin Bridge Facility and (II) 35% to reduce the Equity Contribution and (b) an increase in the Acquisition Consideration shall not be
deemed to be materially adverse to the Lenders or the Commitment Parties if such increase is not funded with indebtedness for borrowed money or disqualified stock of the Borrower or any of its subsidiaries.
3. Confirmation from you that the Equity Contribution shall have been made, or substantially simultaneously with the initial borrowings under
the Credit Facilities, shall be made, in at least the amount set forth in Exhibit A to the Commitment Letter. It is agreed, understood and acknowledged that the issuance of any Preferred Equity is not a condition to funding the Term Facilities, the
Revolving Facility and the Margin Bridge Facility under this Commitment Letter or the Fee Letter.
4 |
All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to
which this Exhibit D is attached, including Exhibits A, B and C thereto. In the case of any such capitalized term that is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit D shall be determined by
reference to the context in which it is used. |
4. Substantially simultaneously with the initial borrowing under the Term Facilities and the
consummation of the Acquisition, the Refinancing shall be consummated.
5. The Lead Arrangers shall have received (a) audited
consolidated balance sheets of the Target and its consolidated subsidiaries as at the end of, and related consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash
flows of the Target and its consolidated subsidiaries for, the two most recently completed fiscal years ended at least 120 days prior to the Closing Date and (b) unaudited condensed consolidated balance sheets of the Target and its consolidated
subsidiaries as at the end of, and related unaudited condensed consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash flows of the Target and its consolidated
subsidiaries for, each subsequent fiscal quarter (other than the last fiscal quarter of the fiscal year) of the Target and its consolidated subsidiaries subsequent to the last fiscal year for which financial statements were prepared pursuant to the
preceding clause (a) and ended at least 60 days before the Closing Date (in the case of this clause (b), without footnotes). The Lead Arrangers hereby acknowledge (x) receipt of the audited financial statements referred to in clause
(a) above for the fiscal years ended December 31, 2021, December 31, 2022 and December 31, 2023 and (y) the public filing by the Company with the Securities and Exchange Commission of any required audited financial
statements on Form 10-K or required unaudited financial statements on Form 10-Q, in each case, will satisfy the requirements under clause (a) or (b), as applicable,
of this paragraph.
6. Subject in all respects to the Limited Conditionality Provisions, all documents and instruments required to create
and perfect the Administrative Agents security interest in the applicable Collateral shall have been executed (if applicable) and delivered by the applicable Borrower and Guarantors and, if applicable, be in proper form for filing.
7. The Administrative Agent and the Lead Arrangers shall have received all documentation at least three business days prior to the Closing Date
and other information about the applicable Borrower and Guarantors that shall have been reasonably requested by the Administrative Agent or Lead Arranger in writing at least 10 business days prior to the Closing Date and that the Administrative
Agent and the Lead Arrangers reasonably determine is required by United States regulatory authorities under applicable know your customer and anti-money laundering rules and regulations, including without limitation the PATRIOT Act. To
the extent a Borrower qualifies as a legal entity customer under the Beneficial Ownership Regulation (as defined below), each Lender that so requests (which request is made through the Administrative Agent) shall have received a
Beneficial Ownership Certification in relation to the Borrower; provided that the Administrative Agent has provided the Borrower a list of each such Lender and its electronic delivery requirements at least five Business Days prior to the
Closing Date. Beneficial Ownership Certification means a certification regarding beneficial ownership required by the Beneficial Ownership Regulation (as defined below), which certification shall be substantially similar in
substance to the form of Certification Regarding Beneficial Owners of Legal Entity Customers included as Appendix A to the Beneficial Ownership Regulation. Beneficial Ownership Regulation means 31 C.F.R. § 1010.230.
8. The closing of the Credit Facilities shall occur on or before the Expiration Date.
D-2
9. With respect to any given Credit Facility, (a) the execution and delivery by the
applicable Borrower and the Guarantors (if any) of the Credit Facilities Documentation for such Facility (including guarantees by the applicable guarantors) which shall, in each case, be in accordance with the terms of the Commitment Letter and the
applicable Term Sheets and subject to the Limited Conditionality Provisions and the applicable Documentation Considerations and (b) delivery to the Lead Arrangers of customary legal opinions, customary officers closing certificates,
organizational documents, customary evidence of authorization and good standing certificates in jurisdictions of formation/organization, in each case with respect to the applicable Borrower and the Guarantors (to the extent applicable) and a
solvency certificate, as of the Closing Date and after giving effect to the Transactions substantially in the form of Annex I attached to this Exhibit D, of a senior financial executive or officer of the Borrower.
10. All fees required to be paid on the Closing Date pursuant to the Fee Letter and reasonable out-of-pocket expenses required to be paid on the Closing Date pursuant to the Commitment Letter, to the extent invoiced at least three business days prior to the Closing Date (except as otherwise reasonably
agreed by the Borrower), shall, upon the initial borrowings under the Initial Term Facilities, have been, or will be substantially simultaneously, paid (which amounts may be offset against the proceeds of the Facilities).
D-3
EXHIBIT D
ANNEX I
Form of Solvency
Certificate
[ ], 202[ ]
This Solvency Certificate (this Certificate) is delivered pursuant to Section [ ] of the Credit Agreement,
dated as of [ ] (as amended as of the date hereof, and as it may be further amended, supplemented or otherwise modified, the Credit Agreement), by and among [ ] (the
Borrower), [ ], the lending institutions from time to time parties thereto and [ ], as the Administrative Agent. Unless otherwise defined herein, capitalized terms used in this Certificate shall
have the meanings set forth in the Credit Agreement.
I, [ ], the [ ] of the Borrower, in that
capacity only and not in my individual capacity (and without personal liability), DO HEREBY CERTIFY on behalf of the Borrower that as of the date hereof, and based upon facts and circumstances as they exist as of the date hereof (and disclaiming any
responsibility for changes in such facts and circumstances after the date hereof), that:
1. For purposes of this certificate, the terms
below shall have the following definitions:
(a) Fair Value
The amount at which the assets (both tangible and intangible), in their entirety, of the Borrower and its subsidiaries taken as a whole would
change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any compulsion to act.
(b) Present Fair Salable Value
The amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the Borrower and its
subsidiaries taken as a whole are sold with reasonable promptness in an arms-length transaction under present conditions for the sale of comparable business enterprises insofar as such conditions can be
reasonably evaluated.
(c) Liabilities
The recorded liabilities (including contingent liabilities that would be recorded in accordance with GAAP) of the Borrower and its
subsidiaries taken as a whole, as of the date hereof after giving effect to the consummation of the Transactions, determined in accordance with GAAP consistently applied.
(d) Will be able to pay their Liabilities as they mature
For the period from the date hereof through the Maturity Date, the Borrower and its subsidiaries on a consolidated basis taken as a whole will
have sufficient assets and cash flow to pay their Liabilities as those liabilities mature or (in the case of contingent Liabilities) otherwise become payable, in light of business conducted or anticipated to be conducted by the Borrower and its
subsidiaries as reflected in the projected financial statements and in light of the anticipated credit capacity.
D-I-1
(e) Do not have Unreasonably Small Capital
The Borrower and its subsidiaries on a consolidated basis taken as a whole after consummation of the Transactions is a going concern and has
sufficient capital to reasonably ensure that it will continue to be a going concern for the period from the date hereof through the Maturity Date. I understand that unreasonably small capital depends upon the nature of the particular
business or businesses conducted or to be conducted, and I have reached my conclusion based on the needs and anticipated needs for capital of the business conducted or anticipated to be conducted by the Borrower and its subsidiaries on a
consolidated basis as reflected in the projected financial statements and in light of the anticipated credit capacity.
2. Based on and
subject to the foregoing, I hereby certify on behalf of the Borrower that after giving effect to the consummation of the Transactions, it is my opinion that (i) the Fair Value of the assets of the Borrower and its subsidiaries on a consolidated
basis taken as a whole exceeds their Liabilities, (ii) the Present Fair Salable Value of the assets of the Borrower and its subsidiaries on a consolidated basis taken as a whole exceeds their Liabilities; (iii) the Borrower and its
subsidiaries on a consolidated basis taken as a whole do not have Unreasonably Small Capital; and (iv) the Borrower and its subsidiaries taken as a whole will be able to pay their Liabilities as they mature.
3. In reaching the conclusions set forth in this Certificate, the undersigned has made such investigations and inquiries as the undersigned has
deemed appropriate, having taken into account the nature of the particular business anticipated to be conducted by the Borrower and the Subsidiaries after consummation of the transactions contemplated by the Credit Agreement.
IN WITNESS WHEREOF, I have executed this Certificate as of the date first written above.
|
|
|
By: |
|
|
|
|
Name: |
|
|
Title: [Chief Financial Officer] |
D-I-2
Exhibit (B)(4)
COATUE TACTICAL SOLUTIONS PS HOLDINGS AIV 9 LP
c/o Coatue Management, L.L.C.
9
West 57th Street, 25th Floor
New York, NY 10019
June 6, 2024
WILDCAT EGH
HOLDCO, L.P.
c/o Silver Lake Partners
55
Hudson Yards
550 West 34th Street, 40th Floor
New York, NY 10001
Attention: Egon Durban
Project Wildcat
Preferred Equity Commitment Letter
Ladies and Gentlemen:
This letter (together
with the exhibits hereto, this Commitment Letter) sets forth the commitment of Coatue Tactical Solutions PS Holdings AIV 9 LP, a Delaware limited partnership (Coatue, we, us
or the Purchaser), subject to the terms and conditions contained herein, to provide or cause to be provided to Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware
(Buyer or you), a portion of the Preferred Financing to consummate the Transactions described in the Transaction Description attached hereto as Exhibit A (the Transaction Description).
As used herein, the Preferred Financing shall mean $50,000,000 of aggregate preferred equity financing that will be used to consummate such Transactions. Capitalized terms used but not defined in this Commitment Letter shall have
the meanings set forth in the Exhibits to this Commitment Letter.
1. |
Commitment. The Purchaser hereby commits, subject to the terms and conditions set forth herein, that, at
(and subject to) the closing of the Acquisition (Closing), it shall provide or shall cause to be provided to Buyer, in exchange for a preferred equity interest in Endeavor Group Holdings, Inc. (Issuer), to be
issued on the terms set forth on Exhibit B, for an amount equal to $50,000,000 of the Preferred Financing (the Commitment). |
Ratings Event means the receipt by the Issuer of a credit rating or an advisory or prospective credit rating from
Moodys Investor Service, Inc. and S&P Global Ratings Inc. of B1 (or better) or B+ (or better), respectively, which ratings give effect to all indebtedness and preferred equity interests expected to be incurred or be outstanding at Closing
(including the Commitment).
2. |
Information. You hereby represent and warrant that (a) all written information and written data
(such information and data, other than (i) estimates, forecasts and other projections (the Projections) and (ii) information of a general economic or industry specific nature, the Information) (in the
case of Information regarding the Target and its subsidiaries and its and their respective businesses, to the best of your knowledge), that has been or will be made available to the Purchaser directly or indirectly by you, the Target or by any of
your or its subsidiaries or representatives, in each case, on your behalf in connection with the transactions contemplated hereby, when taken as a whole and together with the reports and other information filed by the Target or any of its
subsidiaries with the Securities and Exchange Commission (including the risk factors therein), is or will be, when furnished, correct in all material respects and does not or will not, when furnished and when taken as a whole, contain any untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made (after giving effect to all
supplements and updates thereto from time to time) and (b) the Projections that have been or will be made available to the Purchaser by you or by any of your subsidiaries or representatives, in each case, on your behalf in connection with the
transactions contemplated hereby have been, or will be, prepared in good faith based upon assumptions that are believed by you to be reasonable at the time prepared and at the time the related Projections are so furnished to the Purchaser; it being
understood that the Projections are as to future events and are not to be viewed as facts, the Projections are subject to significant uncertainties and contingencies, many of which are beyond your control, that no assurance can be given that any
particular Projections will be realized and that actual results during the period or periods covered by any such Projections may differ significantly from the projected results and such differences may be material. You agree that, if at any time
prior to the closing of the Acquisition and the funding of the Preferred Financing (the Closing Date), you become aware that any of the representations and warranties in the preceding sentence would be incorrect in any material
respect if the Information and the Projections were being furnished, and such representations and warranties were being made, at such time, then you will (or, with respect to the Information and Projections relating to the Target and its
subsidiaries, will use commercially reasonable efforts to) promptly supplement the Information and the Projections such that such representations and warranties are correct in all material respects under those circumstances (or, in the case of the
Information relating to the Target and its subsidiaries and its and their respective businesses, to the best of your knowledge, such representations and warranties are correct in all material respects under those circumstances).
|
3. |
Closing Payments. As consideration for the Commitment hereunder, Issuer agrees, if and only if the
Closing of the portion of the Preferred Financing for which the Purchaser has provided a Commitment and the Transactions occur, to pay, or cause to be paid, to the Purchaser a non-refundable closing payment as
set forth on Annex I (the Closing Payment), which the Purchaser may elect to net fund. |
4. |
Conditions. The Commitment of the Purchaser hereunder shall be subject solely to the occurrence of the
Ratings Event and the conditions expressly set forth in Exhibit C to this Commitment Letter (the Funding Conditions), and upon satisfaction (or waiver by the Purchaser in accordance with this Commitment Letter) of such
conditions, the initial funding of the Commitment of the Purchaser shall occur; it being understood that there are no conditions (implied or otherwise) to the commitment hereunder, including compliance with the terms of this Commitment Letter other
than the Funding Conditions that are expressly stated to be conditions to the issuance and sale of the Preferred Equity on the Closing Date. |
2
Notwithstanding anything to the contrary in this Commitment Letter (including each of the
Exhibits attached hereto) or any other letter agreement or other undertaking concerning the financing of the Transactions to the contrary, (i) the only representations and warranties relating to you or the Target or your or their respective
subsidiaries or businesses or otherwise, the accuracy of which shall be a condition to the funding of the Preferred Financing on the Closing Date shall be (a) such of the representations and warranties (if any) made by, or with respect to, the
Target and its subsidiaries in the Acquisition Agreement as are material to the interests of the Purchaser in its capacity as such, but only to the extent that you (or your affiliate) have the right (taking into account any applicable notice and
cure provisions) to terminate your (and/or its) obligations under the Acquisition Agreement or decline to consummate the Acquisition or otherwise results in a failure of a condition precedent in the Acquisition Agreement (in each case, in accordance
with the terms thereof) as a result of a breach of such representations and warranties in the Acquisition Agreement (to such extent, the Specified Acquisition Agreement Representations) and (b) the Specified Representations
(as defined below) made by the Issuer in the Preferred Equity Documentation, and (ii) the terms of the Preferred Equity Documentation and the Closing Deliverables (as defined in Exhibit C to this Commitment Letter) shall be in a form
such that they do not impair the issuance of the Preferred Equity on the Closing Date assuming the Funding Conditions are satisfied (or waived in writing by the Purchaser in its sole discretion). For purposes hereof, Specified
Representations means the applicable representations and warranties of Issuer to be set forth in the Preferred Equity Documentation relating to organizational corporate existence of Issuer as of the Closing Date; tax status of the Issuer
as a corporation; power and authority, due authorization, execution, delivery and enforceability, in each case, related to, the issuance of the Preferred Financing and performance of the applicable definitive documentation related to the Preferred
Financing; and the issuance of the Preferred Financing does not conflict with the organizational documents of Issuer, or any preemptive rights, rights of first refusal or rights of first offer (or similar rights) applicable to the Preferred
Financing, in each case, after giving effect to any written waivers obtained from any persons having such rights; solvency as of the Closing Date (after giving effect to the Transactions) of the Issuer and its subsidiaries on a consolidated basis
(solvency to be defined in a manner consistent with the manner in which solvency is determined in the solvency certificate to be delivered in the form set forth in Annex II); the Investment Company Act; the use of proceeds of the issuance and sale
of the Preferred Financing not violating the PATRIOT Act (as defined below), OFAC or FCPA; valid issuance of the Preferred Equity and that the Preferred Equity is fully paid and non-assessable; and status of
the Preferred Equity as senior in payment priority and liquidation preference to all equity of the Issuer. This paragraph, and the provisions herein, shall be referred to as the Limited Conditionality Provisions.
3
5. |
Limitation on Liability; Indemnity; Settlement. |
|
a. |
Limitation on Liability. |
Notwithstanding any other provision of this Commitment Letter, (i) no Indemnified Person or Related Indemnified Person shall be liable for
any damages arising from the use by others of information or other materials obtained through internet, electronic, telecommunications or other information transmission systems, except to the extent that such damages have resulted from the willful
misconduct, bad faith or gross negligence of such Indemnified Person or any Related Indemnified Person (as determined by a court of competent jurisdiction in a final and non-appealable decision) and
(ii) none of you (or any of your subsidiaries), the Investors (or any of their respective affiliates), the Target (or any of its subsidiaries or affiliates), any Indemnified Person or any Related Indemnified Person shall be liable for any
indirect, special, punitive or consequential damages (including, without limitation, any loss of profits, business or anticipated savings) in connection with this Commitment Letter, the Transactions (including the Preferred Financing and the use of
proceeds thereunder), or with respect to any activities related to the Preferred Financing, including the preparation of this Commitment Letter and the definitive documentation of the Preferred Financing; provided that nothing in this paragraph
shall limit your indemnity and reimbursement obligations to the extent that such indirect, special, punitive or consequential damages are included in any claim by a third party with respect to which the applicable Indemnified Person is entitled to
indemnification under subsection (b) of this Section 5.
To induce the Purchaser to enter into this Commitment Letter and to proceed with the definitive documentation of the Preferred Financing, you
agree to indemnify and hold harmless the Purchaser, its affiliates and its and its affiliates officers, directors, employees, agents, partners, owners, controlling persons, advisors, attorneys and other representatives of each of the foregoing
and their successors and permitted assigns under this Commitment Letter (each, an Indemnified Person), from and against any and all losses, claims, damages and liabilities of any kind or nature and reasonable and documented or
invoiced out-of-pocket fees and expenses, joint or several, to which any such Indemnified Person may become subject to the extent arising out of, resulting from, or in
connection with any actual or threatened claim, litigation, investigation or proceeding (including any inquiry or investigation) in connection with this Commitment Letter (including Exhibit B hereto (the
Term Sheet)), the Transactions or any related transaction contemplated hereby or thereby, the Preferred Financing or any use of the proceeds thereof (any of the foregoing, a Proceeding),
regardless of whether any such Indemnified Person is a party thereto, whether or not such Proceedings are brought by you, your equity holders, affiliates or creditors or any other third person, and to promptly reimburse after receipt of a written
request, each such Indemnified Person for any reasonable and documented or invoiced out-of-pocket legal fees and expenses incurred in connection with investigating or
defending any of the foregoing by one firm of counsel for all such Indemnified Persons, taken as a whole and, if necessary, by a single firm of local counsel in each appropriate jurisdiction (which may include a single firm of special counsel acting
in multiple jurisdictions) for all such Indemnified Persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Person affected by such conflict notifies you of the existence of such conflict and
thereafter retains its own counsel, by another firm of counsel for such affected Indemnified Person) or other reasonable and documented or invoiced out-of-pocket fees
and expenses incurred in connection with investigating, responding to, or defending any of the foregoing; provided that the foregoing indemnity
4
will not, as to any Indemnified Person, apply to losses, claims, damages, liabilities or related expenses to the extent that they have resulted from (i) the willful misconduct, bad faith or
gross negligence of such Indemnified Person or any Related Indemnified Person (as defined below) (as determined by a court of competent jurisdiction in a final and non-appealable decision), (ii) a material
breach of the obligations of such Indemnified Person or any Related Indemnified Person under this Commitment Letter (as determined by a court of competent jurisdiction in a final and non-appealable decision)
or (iii) any Proceeding solely between or among Indemnified Persons not arising from any act or omission by you or any of your affiliates. The foregoing provisions in this paragraph shall be superseded, in each case, to the extent covered
thereby by the applicable provisions contained in the definitive documentation of the Preferred Financing upon execution and delivery thereof and thereafter shall have no further force and effect.
Related Indemnified Person of an Indemnified Person means (1) any controlling person or any affiliate of such
Indemnified Person, (2) the respective directors, officers, or employees of such Indemnified Person or any of its controlling persons or any of its affiliates and (3) the respective agents, advisors, attorneys and representatives of such
Indemnified Person or any of its controlling persons or any of its affiliates, in the case of this clause (3), acting at the instructions of such Indemnified Person, controlling person or such affiliate (it being understood and agreed that any
agent, advisor or representative of such Indemnified Person or any of its controlling persons or any of its affiliates engaged to represent or otherwise advise such Indemnified Person, controlling person or affiliate in connection with the
Transactions shall be deemed to be acting at the instruction of such person).
You shall not be liable for any settlement of any Proceeding effected without your written consent (which consent shall not be unreasonably
withheld, conditioned or delayed), but if settled with your written consent or if there is a final and non-appealable judgment by a court of competent jurisdiction in any such Proceeding, you agree to
indemnify and hold harmless each Indemnified Person from and against any and all losses, claims, damages, liabilities and reasonable and documented legal or other
out-of-pocket expenses by reason of such settlement or judgment in accordance with and to the extent provided in the other provisions of this Section 5.
You shall not, without the prior written consent of any Indemnified Person (which consent shall not be unreasonably withheld, conditioned or
delayed) (it being understood that the withholding of consent due to non-satisfaction of any of the conditions described in clauses (i), (ii) and (iii) of this sentence shall be deemed reasonable),
effect any settlement of any pending or threatened Proceedings in respect of which indemnity could have been sought hereunder by such Indemnified Person unless such settlement (i) includes an unconditional release of such Indemnified Person in
form and substance reasonably satisfactory to such Indemnified Person from all liability or claims that are the subject matter of such proceedings, (ii) does not include any statement as to or any admission of fault, culpability, wrong doing or
a failure to act by or on behalf of any Indemnified Person and (iii) contains customary confidentiality provisions with respect to the terms of such settlement. Each Indemnified Person shall be severally obligated to refund or return any and
all amounts paid by you under this Section 5 to the extent such Indemnified Person is not entitled to payment of such amounts in accordance with the terms hereof (as determined by a court of competent jurisdiction in a final and non-appealable judgment).
5
6. |
Confidentiality. You agree that you will not disclose, directly or indirectly, prior to your acceptance
hereof, this Commitment Letter, the Term Sheet, the other exhibits and attachments hereto or the contents of each thereof, or the Purchasers activities pursuant hereto or thereto, to any person or entity without the prior written approval of
the Purchaser (such approval not to be unreasonably withheld, delayed or conditioned), except (a) to the Investors (as defined in Exhibit A) and to any of your or the Investors affiliates and your and their respective officers,
directors, employees, agents, attorneys, accountants, advisors, controlling persons and equity holders and to actual and potential co-investors who are informed of the confidential nature thereof, on a
confidential and need-to-know basis, (b) if the Purchaser consents in writing to such proposed disclosure or (c) pursuant to an order of any court or
administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal process or to the extent requested or required by governmental and/or regulatory
authorities, in each case based on the reasonable advice of your legal counsel (in which case you agree, to the extent practicable and not prohibited by applicable law, rule or regulation, to inform us promptly thereof prior to disclosure); provided
that (i) you may disclose this Commitment Letter and the contents hereof (other than with respect to Section 3 hereof and information with respect to fees, compensation or discounts within the Term Sheet) to the Target, its subsidiaries
and affiliates and its and their respective officers, directors, employees, agents, attorneys, accountants, advisors and controlling persons, on a confidential and
need-to-know basis, (ii) you may disclose the Commitment Letter and its contents (including the Term Sheet and other exhibits and attachments hereto) (but not the
contents of Section 3 hereof or information with respect to fees, compensation or discounts within the Term Sheet) in any syndication or other marketing materials in connection with the Credit Facilities (as defined in Exhibit A) and
Margin Bridge Facility (as defined in Exhibit A) (including any marketing materials and information memorandum used in connection therewith), (iii) you may disclose the aggregate fee amounts contained in this Commitment Letter as part of
Projections, pro forma information or a generic disclosure of aggregate sources and uses related to fee amounts related to the Transactions to the extent customary or required in any marketing materials or in connection with the Credit Facilities or
in connection with any public or regulatory filing requirement relating to the Transactions (and then only to the extent aggregate with all other fees and expenses of the Transactions and not presented as an individual line item unless required by
applicable law, rule or regulation), (iii) you may disclose the Term Sheet and other exhibits and attachments to the Commitment Letter, and the contents thereof, to potential co-investors and to rating
agencies in connection with obtaining public ratings for the Borrower (as defined in Exhibit A) and the Credit Facilities, (iv) you may disclose this Commitment Letter and the contents thereof (including the Term Sheet and other exhibits
and attachments hereto) to the initial lenders and any prospective lenders under the Credit Facilities and Margin Bridge Facility, the custodian and the transfer agent in connection with the Margin Loan facility, any additional prospective investor
in the Preferred Financing and to any such persons affiliates and their respective officers, directors, employees, agents, attorneys, accountants and other advisors, on a confidential and need-to-know basis and (v) in connection with any remedy or enforcement of any right hereunder. |
6
The Purchaser and its affiliates will use all
non-public information provided to them or such affiliates by or on behalf of you hereunder or in connection with the Acquisition and the related Transactions solely for the purpose of negotiating, evaluating
and consummating the transactions contemplated hereby and shall treat confidentially all such information and shall not publish, disclose or otherwise divulge, such information; provided that nothing herein shall prevent the Purchaser and its
affiliates from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or
compulsory legal process based on the reasonable advice of counsel (in which case the Purchaser agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory authority or governmental regulatory
authority exercising examination or regulatory authority), to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (b) upon the request or demand of any regulatory
authority having jurisdiction, or purporting to have jurisdiction, over the Purchaser or any of its affiliates (in which case the Purchaser agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory
authority or governmental regulatory authority exercising examination or regulatory authority), to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (c) to the
extent that such information becomes publicly available other than by reason of improper disclosure by the Purchaser or any of its Related Parties (as defined below) in violation of any confidentiality obligations owing to you, the Investors,
Issuer, the Target or any of your or their respective subsidiaries and affiliates, (d) to the extent that such information is or was received by the Purchaser or any of its Related Parties from a third party that is not, to the Purchasers
knowledge, subject to contractual or fiduciary confidentiality obligations owing to you, the Investors, Issuer, the Target or any of your or their respective subsidiaries and affiliates, (e) to the extent that such information is independently
developed by the Purchaser or any of its Related Parties without the use of any confidential information, (f) to the Purchasers affiliates and to its and their respective employees, officers, partners, directors, legal counsel,
independent auditors, rating agencies, professionals and other experts or agents and existing and prospective limited partners and financing sources who need to know such information in connection with the Transactions and who are informed of the
confidential nature of such information and who are subject to customary confidentiality obligations and who have been advised of their obligation to keep information of this type confidential (collectively, the Related Parties),
with the Purchaser, to the extent within its control, responsible for such persons compliance with this paragraph, (g) to the extent you consent in writing to any specific disclosure or (h) to the extent such information was already
in the Purchasers possession prior to any duty or other understanding of confidentiality entered into in connection with the Transactions. In the event that the Preferred Financing is funded, the Purchaser and its respective affiliates,
if any, obligations under this paragraph shall terminate automatically and be superseded by the confidentiality provisions in the definitive documentation of the Preferred Financing upon the initial funding thereunder to the extent that such
provisions are binding on the Purchaser.
7
Subject to the immediately preceding sentence, the confidentiality provisions set forth in
this Section 6 shall survive the termination of this Commitment Letter and expire and shall be of no further effect after the second anniversary of the date hereof.
7. |
Absence of Fiduciary Relationship. The Purchaser, together with its respective affiliates (collectively,
the Sponsor Entities), is a financial investment firm and as such from time to time may effect transactions for its own account, and hold long or short positions in debt or equity securities or loans of companies that may be the
subject of the transactions contemplated hereby. You also acknowledge that the Sponsor Entities have no obligation to use in connection with the transactions contemplated hereby, or to furnish to you, confidential information obtained from other
companies or other persons. The Sponsor Entities may have economic interests that conflict with your economic interests and those of the Target. You acknowledge and agree that (a)(i) the agreements described herein regarding the Preferred Equity are
arms-length commercial transactions between you and your affiliates, on the one hand, and the Purchaser, on the other hand, that do not directly or indirectly give rise to, nor do you rely on, any
fiduciary duty on the part of the Sponsor Entities, and (ii) you will not assert, to the fullest extent permitted by law, any claims that you may have against the Purchaser or any of its affiliates for alleged breach of fiduciary duty arising
by virtue of this Commitment Letter and (b) in connection with the transactions contemplated hereby, none of the Sponsor Entities have any obligation to you or your affiliates, except those obligations of Purchaser expressly set forth in this
Commitment Letter and any other agreement with you or any of your affiliates. |
8. |
Miscellaneous. This Commitment Letter and the commitment hereunder shall not be assignable by any party
hereto (other than (i) any assignment occurring as a matter of law pursuant to, or otherwise substantially simultaneously with, the Acquisition on the Closing Date, in each case to the Target, Merger Sub or the Issuer, (ii) by you to
(a) Target, Merger Sub or the Issuer substantially simultaneously with the Acquisition on the Closing Date or (b) a U.S. domestically organized entity, in each case, so long as such entity is, or will be, controlled by you or the Investors
after giving effect to the Transactions and shall (directly or indirectly through one or more wholly-owned subsidiaries) own the Target and the Issuer and agrees to be bound by the terms hereof or (iii) by Purchaser to affiliated investment
entities and funds, in each case, managed by Coatue Management LLC (excluding in any event any portfolio company of Coatue and its affiliates and related funds) and who shall agree to be bound by the terms hereof) without the prior written consent
of each other party hereto (such consent not to be unreasonably withheld, conditioned or delayed) (and any attempted assignment without such consent shall be null and void). This Commitment Letter and the commitment hereunder are intended to be
solely for the benefit of the parties hereto (and Indemnified Persons) and do not and are not intended to confer any benefits upon, or create any rights in favor of, any person other than the parties hereto (and Indemnified Persons to the extent
expressly set forth herein). The Purchaser reserves the right to employ the services of their respective affiliates or branches in providing services contemplated hereby and to allocate, in whole or in part, to their affiliates or branches certain
fees payable to the Purchaser in such manner the Purchaser and its affiliates or branches may agree in their sole discretion, and, to the extent so employed, such affiliates and branches shall be entitled to the benefits and protections afforded to,
and subject to the provisions governing the conduct of the Purchaser hereunder. This Commitment Letter may not be amended or any provision hereof waived or modified except by an instrument in writing signed by the Purchaser and you. This
|
8
|
Commitment Letter may be executed in any number of counterparts, each of which shall be deemed an original and all of which when taken together, shall constitute one agreement. Delivery of an
executed counterpart of a signature page of this Commitment Letter by facsimile transmission or other electronic transmission (i.e., a pdf or tif) shall be effective as delivery of a manually executed counterpart thereof. All
Electronic Signatures (including, without limitation, facsimile or .pdf) on or associated with any Communication shall be valid and binding on the applicable signatory to the same extent as a manual, original signature, and that any Communication
entered into by Electronic Signature, will constitute such signatorys legal, valid and binding obligation enforceable against such signatory in accordance with the terms thereof to the same extent as if a manually executed original signature
was delivered to the other signatories. This Commitment Letter (including the exhibits hereto), together with any other letter agreement entered into with the Purchaser on or prior to the date hereof, (i) are the only agreements that have been
entered into among the parties hereto with respect to our commitment with respect to the Preferred Financing and (ii) supersede all prior understandings, whether written or oral, among us with respect to the Preferred Financing and sets forth
the entire understanding of the parties hereto with respect thereto. THIS COMMITMENT LETTER, AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER, OR RELATED TO, THIS COMMITMENT LETTER (INCLUDING, WITHOUT LIMITATION, ANY CLAIMS SOUNDING IN CONTRACT
LAW OR TORT LAW ARISING OUT OF THE SUBJECT MATTER HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; provided that, notwithstanding the foregoing, it is understood and agreed that (a) the
interpretation of the definition of Material Adverse Effect (as defined in the Acquisition Agreement) (and whether or not a Material Adverse Effect has occurred), (b) the determination of the accuracy of any Specified Acquisition
Agreement Representation and whether as a result of any inaccuracy thereof you (or your affiliate) have the right (taking into account any applicable cure provisions) to terminate your obligations under the Acquisition Agreement or decline to
consummate the Acquisition and (c) the determination of whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement, in each case shall be governed by, and construed in accordance with, the laws of the
State of Delaware as applied to the Acquisition Agreement, without regard to the principles of conflicts of law that would cause the application of law of any jurisdiction other than those of the State of Delaware. |
The Purchaser or its affiliates may, in consultation with you, place customary advertisements in financial and other newspapers and periodicals
or on a home page or similar place for dissemination of customary information on the Internet or worldwide web as it may choose, and circulate similar promotional materials, in each case, after the Closing Date, in the form of tombstone
or otherwise describing the name of the Issuer and the amount, type and closing date of the Transactions, all at the expense of the Purchaser or affiliate.
Each of the parties hereto agrees that this Commitment Letter is a binding and enforceable agreement (except as may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer, moratorium or similar laws relating to or affecting the rights of creditors generally) with respect to the subject matter contained herein, including an agreement to negotiate in good
faith the Preferred Equity Documentation by the parties hereto in a manner consistent with this Commitment Letter, it being acknowledged and agreed that the commitment provided hereunder is subject solely to conditions precedent as expressly
provided herein.
9
EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER OR PROVIDING OF COMMITMENT, AS THE CASE MAY BE, HEREUNDER.
Each of the parties hereto hereby irrevocably and unconditionally (a) submits, for itself and its property, to the exclusive jurisdiction
of any New York State court or Federal court of the United States of America sitting in New York County in the State of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Commitment
Letter or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and agrees that all claims in respect of any such action or proceeding shall be heard and determined in such New York State court or, to
the extent permitted by law, in such Federal court, (b) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of
or relating to this Commitment Letter or the transactions contemplated hereby or thereby in any New York State or in any such Federal court, (c) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court and (d) agrees that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Each of the parties hereto agrees that service of process, summons, notice or document by registered mail addressed to you or us at the addresses set forth above shall be effective service of process for any suit, action or
proceeding brought in any such court.
We hereby notify you that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56) (signed into law October 26, 2001) (the PATRIOT Act) and the requirements of 31 C.F.R. § 1010.230 (the Beneficial Ownership Regulation), the Purchaser may be
required to obtain, verify and record information that identifies the Issuer and its subsidiaries, which information may include their names, addresses, tax identification numbers and other information that will allow the Purchaser to identify the
Issuer and its subsidiaries in accordance with the PATRIOT Act or the Beneficial Ownership Regulation, as applicable. This notice is given in accordance with the requirements of the PATRIOT Act or the Beneficial Ownership Regulation, as applicable,
and is effective for the Purchaser.
The survival, indemnification, compensation (if applicable), reimbursement (if applicable),
jurisdiction, governing law, venue, waiver of jury trial and confidentiality provisions contained herein shall remain in full force and effect regardless of whether the Preferred Financing shall have been issued and notwithstanding the termination
or expiration of this Commitment Letter or the Purchasers Commitment hereunder; provided that your obligations under this Commitment Letter shall automatically terminate and be superseded by the provisions of the definitive documentation
relating to the Preferred Equity (to the extent covered therein) upon the initial funding thereunder, and you shall automatically be released from all liability in connection therewith at such time. You may terminate this Commitment Letter and/or
the Purchasers Commitment with respect to the Preferred Financing (or any portion thereof) hereunder at any time subject to the provisions of the preceding sentence.
10
Section headings used herein are for convenience of reference only and are not to affect the
construction of, or to be taken into consideration in interpreting, this Commitment Letter.
9. |
The Purchaser represents that (i) it is an accredited investor within the meaning of
Regulation D, Rule 501(a), promulgated by the SEC under the Securities Act, as presently in effect and (ii) it is able to fend for itself, can bear the economic risk of its investment in the Preferred Financing, and has such knowledge and
experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Preferred Financing. |
10. |
Effectiveness; Expiration. If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms of this Commitment Letter by returning to the Purchaser (or its legal counsel on behalf of the Purchaser), executed counterparts hereof not later than 11:59 p.m., New York City time, on June 4, 2024. The Purchasers
Commitment and obligations hereunder will expire at such time in the event that the Purchaser (or its legal counsel) have not received such executed counterparts in accordance with the immediately preceding sentence. If you do so execute and deliver
to us this Commitment Letter at or prior to such time, we agree to hold our commitment to provide the Preferred Financing and our other undertakings in connection therewith available for you until the earliest of (i) after execution and
delivery of the Acquisition Agreement and prior to the consummation of the Transactions, the termination of the Acquisition Agreement by you (or your affiliate) or with your (or your affiliates) written consent in accordance with its terms
(other than with respect to provisions therein that expressly survive termination), (ii) the consummation of the Acquisition without the issuance by the Issuer of the Preferred Financing, (iii) 11:59 p.m., New York City time on the date that is five
business days after the Outside Date (as defined in and as may be extended pursuant to the Acquisition Agreement as in effect as of the date hereof and (iv) July 9, 2025 (such earliest time, the Expiration Date). Upon
the occurrence of any of the events referred to in the preceding sentence, this Commitment Letter and the commitment of the Purchaser hereunder shall automatically terminate unless the Purchaser shall, in its sole discretion, agree to an extension
in writing. The termination of any Commitment pursuant to this paragraph will not prejudice your rights and remedies in respect of any breach or repudiation of this Commitment Letter. |
11
|
|
|
Sincerely, |
|
COATUE TACTICAL SOLUTIONS PS HOLDINGS AIV 9 LP |
|
By: Coatue Structured Fund GP LLC, its general partner |
|
|
By: |
|
/s/ Zachary Feingold |
Name: |
|
Zachary Feingold |
Title: |
|
Authorized Signatory |
Address: |
|
c/o Coatue Management, L.L.C. |
|
|
|
|
9 West 57th Street, 25th Floor |
|
|
New York, NY 10019 |
|
|
Attention: Zachary Feingold |
|
|
Email: |
|
legal@coatue.com |
|
|
|
Agreed and accepted as of |
the date first written above: |
|
WILDCAT EGH HOLDCO, L.P. |
|
By: SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
By: SLTA VII (GP), L.L.C., its general partner
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: |
|
Egon Durban |
Title: |
|
Co-CEO |
Exhibit A
Project Wildcat
Transaction Description
Capitalized terms used but not defined in this Exhibit A shall have the meanings set forth in the other Exhibits to the Commitment
Letter to which this Exhibit A is attached (the Commitment Letter) or in the debt commitment letter dated as of the date hereof (the Debt Commitment Letter). In the case of any such capitalized term that
is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit A shall be determined by reference to the context in which it is used.
Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (Buyer or Holdco
Parent) and Wildcat OpCo Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (OpCo Parent), were formed at the direction of Silver Lake Partners and its affiliates (collectively, with
the funds partnerships, co-investment entities and other investment vehicles managed, advised or controlled thereby or by one or more directors thereof or under common control therewith, Silver
Lake or Sponsor). Pursuant to an Agreement and Plan of Merger, dated as of the date hereof (together with all exhibits, schedules and other disclosure letters thereto, collectively, as amended, the Acquisition
Agreement), by and among Holdco Parent, OpCo Parent, Wildcat PubCo Merger Sub, Inc., a corporation organized under the laws of the State of Delaware and wholly-owned subsidiary of Holdco Parent (Company Merger Sub),
Wildcat OpCo Merger Sub, L.L.C., a limited liability company organized under the laws of the State of Delaware and wholly-owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Company Merger Sub, the Merger
Subs and each, a Merger Sub and the Merger Subs, together with Holdco Parent and OpCo Parent, the Buyer Entities), a company previously identified to us and code-named Wildcat (the
Company or the Target), and a subsidiary of the Company (the OpCo and, together with the Company, the Company Entities and each, a Company Entity), (i)
Company Merger Sub will merge with and into the Target (the Company Merger), with the Target being the surviving entity of the Company Merger and (ii) OpCo Merger Sub will merge with and into the OpCo (the OpCo
Merger and, together with the Company Merger, the Mergers), with the OpCo being the surviving entity of the OpCo Merger, whereby (A) Holdco Parent will acquire, directly or indirectly, the equity interests of the
Company from the equity holders thereof (collectively, the Company Sellers) and, indirectly, the equity interests of OpCo owned by the Company and (B) OpCo Parent will acquire certain equity interests of the OpCo from the
equity holders thereof (collectively, the OpCo Sellers and, together with the Company Sellers, the Sellers). Other than certain Sellers who may be given the opportunity to retain, rollover or reinvest capital
stock, restricted stock units, profits interests and/or options into OpCo and/or the Company (including certain members of the management of the Company and its subsidiaries) (the Rollover Investors), the Sellers will receive cash
(the Acquisition Consideration) in exchange for their capital stock, restricted stock units, profits interests and/or options in the Company Entities. Immediately after giving effect to the Mergers and the other Transactions, the
Company will be a wholly-owned direct subsidiary of Holdco Parent and OpCo will be owned, collectively, directly or indirectly, by the Rollover Investors, Holdco Parent and OpCo Parent.
A-1
In connection with the foregoing, it is intended that:
|
a) |
The Issuer will issue newly issued shares of a class of preferred equity with an initial stated value of $1,000
per share (such shares the Preferred Equity) and in an aggregate initial stated value of up to $750 million (the Preferred Equity Issuance). |
|
b) |
The Sponsor and certain other investors (including certain Rollover Investors) arranged by and/or designated by
the Sponsor (collectively with the Sponsor, the Investors) will directly or indirectly make (X) cash equity contributions to the Buyer Entities (the foregoing cash equity contributions to the Buyer Entities, the
Common Equity Contribution and, together with the Preferred Equity Issuance, collectively the Equity Contribution), in an aggregate amount equal to, when combined with the fair market value of any capital stock
or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions (as defined below) and the proceeds of the Preferred Equity Issuance, at least 35.0% of the sum of (1) the aggregate gross
proceeds of the Facilities borrowed on the Closing Date, excluding the aggregate gross proceeds of (A) any Loans (as defined in the Debt Commitment Letter) to fund original issue discount and/or upfront fees in connection with the exercise of
the Market Flex Provisions under the Fee Letter (as defined in the Debt Commitment Letter) and (B) any Revolving Loans (as defined in the Debt Commitment Letter) to fund any working capital needs on the Closing Date and (2) the
equity capitalization of the Borrower and its subsidiaries on the Closing Date after giving effect to all of the Transactions (such sum of clauses (1) and (2), the Total Capitalization) and (Y) the Common Equity
Contribution, in an aggregate amount equal to, when combined with the fair market value of any capital stock or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions, at least 30.0% of
the Total Capitalization (the Minimum Common Equity Contribution); provided that, if applicable, to the extent any stockholder or other equity holder of the Target has exercised appraisal rights in connection with the
Transactions, then on the Closing Date the Investors may elect to issue one or more equity commitment letters and/or arrange for one or more letters of credit to be issued on their behalf in an aggregate amount not less than the amount of
consideration that would otherwise be paid under the Acquisition Agreement in respect of the shares or other equity interests subject to such appraisal rights (the Appraisal Shares) and, for purposes of this Commitment Letter, an
aggregate amount of such equity commitment letters and/or letters of credit up to, but not in excess of, the amount of consideration that would otherwise be paid under the Acquisition Agreement in respect of the Appraisal Shares shall be included in
the amount and percentage of the Equity Contribution from and after the Closing Date as if such amount was funded in cash (with it being understood that, on or prior to the date of the final resolution of all such appraisal rights, the lesser of
(a) the amount necessary to satisfy such appraisal rights in full and (b) an amount equal to the full amount committed under such equity commitment letters and/or the face value of any such letters of credit shall be funded, directly or
indirectly, in cash to a newly formed limited liability company organized under the laws of the United States or any state thereof and an indirect subsidiary of the Target that is the borrower under the Revolving Facility and the Initial Term
Facilities (the Borrower) in the form of common equity or preferred equity that ranks junior or pari passu to the Preferred Equity such that the aggregate initial stated value of Preferred Equity issued shall not exceed
$750 million); provided, further that, the Sponsor will control a majority of the voting equity of the Issuer as of the Closing Date. |
A-2
|
c) |
The Borrower will obtain (i) up to $4,250 million under a senior secured term loan A- facility (the Initial Term A Facility) described in the Debt Commitment Letter, (ii) up to $2,750 million under a senior secured term loan B facility described in the Debt Commitment
Letter (the Initial Term B Facility), (iii) up to $250 million under a senior secured revolving credit facility described in the Debt Commitment Letter (the Revolving Facility) and (iv) a senior
secured 364-day term loan facility described in the Debt Commitment Letter (the Margin Bridge Facility and, collectively with the Initial Term A Facility and the Initial Term B Facility, the
Initial Term Facilities; the Initial Term Facilities and the Revolving Facility, collectively, the Credit Facilities) in an aggregate principal amount of up to (A) $1,500 million minus (B) the
aggregate principal amount of any loans funded under the Margin Bridge Facility on the Closing Date. |
|
d) |
The Margin Loan Borrower (as defined in the definitive documentation for the Margin Loan Facility) will seek to
obtain up to $1,500 million under a margin loan facility described in the Debt Commitment Letter (the Margin Loan Facility and, together with the Credit Facilities, the Facilities). |
|
e) |
All principal, accrued, but unpaid interest, fees and other amounts (other than contingent obligations not then
due and payable) outstanding on the Closing Date under the First Lien Credit Agreement, dated as of May 6, 2014 (as amended and restated by Amendment No. 5, dated as of May 18, 2018, and as further amended, supplemented or otherwise
modified from time to time, the Existing Wildcat Credit Agreement and, together with the Existing Tiger Credit Agreement, the Existing Credit Agreements), by and among the WME IMG Holdings, LLC, William Morris Endeavor
Entertainment, LLC, as borrower, IMG Worldwide Holdings, LLC, as co-borrower, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other parties thereto,
shall be repaid in full in connection with, and substantially concurrently with the closing of, the Transactions, and all commitments to lend and guarantees and security in connection therewith shall have been terminated and/or released or customary
arrangements for such termination and/or release have been agreed upon with the administrative agent (the Refinancing). |
|
f) |
The proceeds of the Equity Contribution (including the Preferred Equity Issuance), the Facilities and/or a
portion of the cash on hand at the Target and its subsidiaries on the Closing Date will be applied to pay (i) the Acquisition Consideration, (ii) the Refinancing and (iii) the fees and expenses incurred in connection with the
Transactions (such fees and expenses, the Transaction Costs, and the amounts set forth in clauses (i) through (iii) above, collectively, the Acquisition Funds). |
The transactions described above (including the payment of Transaction Costs) are collectively referred to herein as the
Transactions.
A-3
Exhibit B
Project Wildcat
Preferred Equity
Summary
of Principal Terms and Conditions
|
|
|
Issuer: |
|
Endeavor Group Holdings, Inc. (the Issuer) |
|
|
Purchaser of the Preferred Equity: |
|
Coatue Tactical Solutions PS Holdings AIV 9 LP |
|
|
Preferred Equity to be Purchased: |
|
Up to an aggregate amount of 50,000 shares of a single class of Series A Preferred Stock of the Issuer (the
Preferred Equity), with the Stated Value (as defined below) of $1,000 per share and an initial aggregate Stated Value of up to $50.0 million.
The Purchased Shares shall form and be part of a single series of Preferred Equity of up
to an aggregate of 750,000 shares of Preferred Equity to be issued on the Issue Date pursuant to an existing commitment letter entered into by the Issuer and two purchasers thereof (the Existing
Purchasers). |
|
|
OpCo Preferred Equity: |
|
On the Issue Date (as defined below), Endeavor Operating Company LLC (EOC) shall issue to Endeavor Manager, LLC (Manager) or reclassify existing common units of EOC held by Manager
into, in each case, a single class of preferred equity units of EOC (the Mirror Units), with the foregoing resulting in Mirror Units in the same number, amount of initial stated value and which shall otherwise have economic
terms consistent with that of the Preferred Equity. Any proceeds attributable to the Mirror Units received by the Manager shall be applied on a dollar for dollar basis to redeem the Preferred Equity and the Mirror Units may not at any time be
transferred by the Manager. |
|
|
Ranking: |
|
The Preferred Equity, with respect to dividend rights and rights upon the Issuers liquidation, winding up or dissolution, will rank senior to all other equity interests of the Issuer. |
|
|
Issue Date: |
|
If the Closing of the portion of the Preferred Financing for which the Purchaser has provided a Commitment occurs, the Preferred Equity to be purchased by the Purchaser will be issued on the closing date of the Acquisition (such
date of issuance, the Issue Date), conditioned upon the occurrence of the Ratings Event and the satisfaction or waiver by Purchaser of the conditions set forth in Exhibit
C. |
B-1
|
|
|
Dividends: |
|
Dividends will accrue and accumulate on a daily basis in arrears from the Issue Date at an annual rate equal to the Preferred Dividend Rate
(as defined below) on the Stated Value of the Preferred Equity outstanding from time to time, whether or not declared and paid, and if not declared and paid, will accrue and be compounded semi-annually in arrears (such compounded dividends, the
Compounded Dividends) on dividend payment dates to be mutually agreed upon by the Issuer and the Purchaser (each such date, a Dividend Payment Date). Unless otherwise elected by the Issuer,
dividends on the Preferred Equity will not be paid in cash and instead will continue to accrue and be compounded in arrears on each Dividend Payment Date. Dividends (other than Compounded Dividends, which will be redeemable solely in accordance with
Optional Redemptions and Mandatory Redemptions below) will be payable, at the election of the Issuer, in cash at any time, when, as and if declared by the board of directors of the Issuer or any authorized committee thereof.
For the avoidance of doubt, declared dividends can only be paid in cash.
Preferred Dividend Rate means 14.00% per annum from the Issue Date to the 8th
anniversary of the Issue Date, increasing by 100 basis points per annum beginning on the 8th anniversary of the Issue Date and an additional 100 basis points on each anniversary of the Issue Date
thereafter; provided that the Preferred Dividend Rate shall not at any time exceed 18.0% per annum (other than as a result of and upon the occurrence of an Event of Default).
Stated Value means, at any date of determination and with
respect to each outstanding share of Preferred Equity, the sum of (i) $1,000 (adjusted as appropriate in the event of any stock dividend, stock split, recapitalization or combination with respect to the Preferred Equity), plus (ii) the
aggregate Compounded Dividends with respect to such share as of the date of determination. |
|
|
Maturity: |
|
Perpetual. |
|
|
Optional Redemption: |
|
The Issuer may, at its option on any one or more dates after the Issue Date (any such date, a Redemption Date), redeem the Preferred Equity, in whole or in part, in cash at the Redemption
Price (as defined below). |
|
|
|
|
Redemption Price means, with respect to any share of Preferred Equity at any Redemption Date: |
B-2
|
|
|
|
|
|
|
(a)with respect to any Redemption Date occurring prior to the First Call Date, an amount per share equal to (A) the sum of (i) the Stated Value as of such Redemption Date and (ii) the Make-Whole Amount as of such
Redemption Date, with this clause (ii) discounted to the present value as of the Redemption Date using an annual discount rate (applied quarterly) equal to the rate on U.S. Treasury notes with a maturity closest to the First Call Date plus 50
basis points, plus (B) the aggregate accumulated and unpaid dividends (other than the Compounded Dividends) up to, but excluding, the Redemption Date; and |
|
|
|
|
(b)with respect to any Redemption Date occurring on or after the First Call Date, an amount per share equal to the (i) Stated Value, multiplied by the applicable Redemption Percentage, plus (ii) the
aggregate accumulated and unpaid dividends (other than Compounded Dividends), up to, but excluding, the Redemption Date. |
|
|
|
|
Make-Whole Amount means, with respect to any redemption of any share of Preferred Equity prior to the 24-month anniversary of the Issue Date (the
First Call Date), an amount equal to the sum of (I) the remaining dividends that would accrue on such share of Preferred Equity being redeemed from the Redemption Date to the First Call Date, plus (II) the
premium portion of the Redemption Price (i.e., such portion that is above par) that would be payable on the First Call Date in respect of the Preferred Equity being redeemed, assuming that, for purposes of calculating clauses (I) and (II), that
such share of Preferred Equity were to remain outstanding through the First Call Date (including any applicable deemed accumulation and compounding of dividends during such period), and then be redeemed on the First Call Date. |
|
|
|
|
Redemption Percentage means (a) beginning on the First Call Date and until the one-year anniversary of the First Call Date, 102.0% and (b) thereafter,
100%. |
|
|
Mandatory Redemption: |
|
In the event of (i) the occurrence of a Change of Control (as such term shall be defined and to be based on clause (b) of the corresponding definition in the Credit Agreement dated as of August 18, 2016 among Zuffa
Guarantor, LLC, UFC Holdings, LLC, as the borrower, Goldman Sachs Bank USA, as administrative agent, and the other parties thereto, as amended (but with the deletion of clause (b) of the defined term Sponsor), and consistent with
such definition in the credit agreement to be entered into on or around the Issue Date (the New Credit Agreement) but shall require that the Issuer at all |
B-3
|
|
|
|
|
times (a) own, directly or indirectly, 100% of the equity interests of Manager and (b) control the majority of the voting interests
of EOC), (ii) the consummation of an IPO (as defined below), or (iii) any voluntary or involuntary bankruptcy, liquidation, dissolution or winding up of the Issuer or the Borrower, then all outstanding Preferred Equity shall be redeemed for
cash at a price per share equal to the applicable Redemption Price as of such Redemption Date.
An IPO means the consummation of any transaction resulting in the common equity interests of the Issuer, a parent entity or a subsidiary thereof,
or a successor of the Issuer, on the New York Stock Exchange, the NASDAQ Global Market or other internationally recognized stock exchange or similar market including via a consummated bona fide initial underwritten public offering, direct listing or
consummation of a merger or acquisition by a publicly listed special purpose acquisition vehicle. |
|
|
Documentation: |
|
The Preferred Equity issued on the Issue Date will be purchased by the Purchaser pursuant to a purchase agreement to be mutually agreed between the Issuer and the Purchaser (the Purchase
Agreement), including representations and warranties substantially consistent with the New Credit Agreement, with such changes as are appropriate for a preferred equity purchase agreement (which shall include, among others,
representations as to the capitalization of the Issuer, no registration of the Preferred Equity, due authorization, valid issuance of the Preferred Equity, tax status of the Issuer as a corporation and
non-United States real property holding corporation status of the Issuer) and the Preferred Equity will be issued pursuant to a Certificate of Designations (together with the Purchase Agreement, the
Preferred Equity Documentation). |
|
|
Information Rights: |
|
The Certificate of Designations will include such information rights as is consistent with the New Credit Agreement, but with such modifications for a preferred equity security, including that (i) audited annual financial
statements of the Borrower shall be delivered within 120 days (or, in the case of the first fiscal year ending after the Closing Date, 150 days) of the last day of each fiscal year, (ii) unaudited quarterly financial statements of the Borrower
shall be delivered within 60 days (or, in the case of the first three fiscal quarters ending after the Closing Date, 90 days) of the last day of each of the first three fiscal quarters and (iii) prior to an IPO, the Borrower shall deliver an
annual budget within the time period required for |
B-4
|
|
|
|
|
delivery of audited annual financial statements; provided that the financials referred to in clauses (i) and (ii) shall include such information that explains in reasonable detail, the material differences, if any,
between the information relating to the Borrower and its consolidated subsidiaries on the one hand, and the Issuer and its consolidated subsidiaries on a standalone basis, on the other hand; |
|
|
Remedies to Holders: |
|
If an Event of Default (to be defined in a manner consistent with the New Credit Agreement as in effect on the Issue Date, but as applied to
the definitive documentation for the Preferred Equity and with customary modifications for a preferred equity security to be mutually agreed among the Issuer and the Purchaser) occurs, the Preferred Dividend Rate shall increase by 2.00%.
The Certificate of Designations shall include customary remedies in the event of any
breach, including specific performance and all other available remedies under equity and law, and nothing in the foregoing paragraph shall be deemed to limit the ability of a holder of Preferred Equity to exercise such remedies. |
|
|
Voting Rights: |
|
The holders of Preferred Equity will not have any voting or consent rights; provided, however, that so long as any Preferred Equity remains outstanding, unless a greater percentage is then required by law, the Issuer will not,
without the affirmative vote or consent of the Holder Majority (as defined below), (x) amend, restate, supplement, alter, modify, repeal, waive or change the terms, designations, preferences, rights, privileges or powers of, or the restrictions
provided for the benefit of, the Preferred Equity, (y) effect any binding exchanges, conversions or reclassifications of the Preferred Equity or the Mirror Units or (z) amend, restate modify or change the terms of (or otherwise permit the
amendment, restatement modification or change of the terms of) the organizational documents of the Issuer or EOC in a manner that results in a disproportionate and adverse effect on the holders of Preferred Equity in any material respect;
provided, for the avoidance of doubt, that after the Closing any issuance of preferred equity (including any preferred equity ranking pari passu with or senior to the Preferred Equity) made in compliance with the debt incurrence
covenant shall not require any affirmative vote or consent of any holder of the Preferred Equity. |
B-5
|
|
|
|
|
Holder Majority means holders of a majority of the outstanding Preferred Equity, provided, that each of the Existing Purchasers must be included in any such majority (on a separate and not joint basis) so
long as such Existing Purchaser or any transferee thereof (to which the Preferred Equity has been transferred in compliance with the terms of the Preferred Equity Documentation) holds as of the applicable date of determination not less than 50.1% of
the sum of (i) the Stated Value of the Preferred Equity purchased by such Existing Purchaser on the Closing Date less any Preferred Equity that has been redeemed by the Issuer from such Purchaser or transferee, as applicable, and (ii) the
aggregate Compounded Dividends with respect to such Preferred Equity referred to in clause (i) as of the date of determination; provided that (x) with respect to the any of the Existing Purchasers, only such Existing Purchaser or any
transferee thereof (but not both) shall be required to constitute a Holder Majority at any given time and (y) there shall be no more than two holders at any given time who must be required to be included in the Holder Majority. |
|
|
Negative Covenants: |
|
The Preferred Equity Documentation will include customary negative covenants applicable to the Issuer and its restricted subsidiaries that
shall be substantially consistent with (but no more restrictive) than those contained in the New Credit Agreement as in effect on the Issue Date, with a 25% cushion for all baskets (but not for ratios) and with the following
exceptions: (a) with
respect to the debt incurrence covenant, incurrence shall be limited to (i) the Total Leverage Ratio test pursuant to which the Issuer and its restricted subsidiaries may incur or issue an unlimited amount of indebtedness and
preferred equity interests so long as pro forma for such incurrence, the Total Leverage Ratio (which shall be defined in a manner consistent with the New Credit Agreement as in effect on the Issue Date, but shall give effect to the Stated Value of
the Preferred Equity (but excluding any Compounded Dividends), and the liquidation preference of any preferred equity interests that are senior to or pari passu with the Preferred Equity or disqualified equity interests of the Issuer and its
restricted subsidiaries, in each case, excluding any compounded dividends accruing at a rate of up to 14% per annum that are paid or payable in-kind) does not exceed 9.00:1.00 (it being understood that the
foregoing shall not apply to indebtedness under a revolver or other working capital facility or any purchase money indebtedness (including financing lease obligations)) and (ii) customary non-dollar and non-ratio based baskets (other than debt for borrowed money) consistent with the New Credit Agreement as in effect on the Issue Date; |
B-6
|
|
|
|
|
(b) the restricted payments covenant shall prohibit (i) any in-kind distributions by the Issuer and its subsidiaries and (ii) the making of any dividend, distribution or redemption that is paid in cash in respect of shares of common equity, as a class, of
the Issuer or any of its subsidiaries pursuant to the builder basket, the unlimited ratio basket or the general restricted payments basket shall be subject to the requirements under the section titled RP Offer Amount; and
(c) limitations to be
mutually agreed between the Issuer and the Purchaser with respect to the Issuer or any of its subsidiaries pursuing any business activity in the gaming industry that would require the holders of the Preferred Equity or of any of their respective
affiliates or employees to comply with licensing requirements or requirements for invasive or burdensome disclosure of private financial or personal information, or that would impose any burdensome regulatory obligation or constraints on the holders
or their respective affiliates or employees. |
|
|
|
|
For the avoidance of doubt, (x) except as set forth above, the restricted payments covenant shall include all baskets, ratios and exceptions as set forth in the New Credit Agreement as in effect on the Issue Date, with a 25%
cushion for all baskets (but not for ratios) and (y) the Issuer shall be permitted to designate subsidiaries as unrestricted subsidiaries subject only to certain requirements which shall be consistent with those set
forth in the New Credit Agreement. |
|
|
RP Offer Amount: |
|
In the event of any proposed dividend, distribution or redemption that is paid in cash with respect to shares of common equity, as a class, of the Issuer or any of its subsidiaries to be made in reliance upon the builder
basket, the unlimited ratio basket or the general restricted payments basket, the contemplated amount of such dividend, distribution or redemption (or, if less, the amount of the Stated Value of the then outstanding Preferred Equity) (the
RP Offer Amount) shall first be offered to the holders of Preferred Equity to redeem at par the then outstanding Preferred Equity at the then current Stated Value thereof on a pro rata basis; provided that (x) such
holders may elect to receive all or any part of their pro rata amount of such RP Offer Amount and (y) any declined amounts shall be offered to accepting holders (based on their pro rata share of such declined amounts) before such declined
amounts may fund any redemption, distribution, payment or transfer of value to any holder of junior equity interests of the Issuer, the Manager or EOC. |
B-7
|
|
|
Affirmative Covenants: |
|
The Certificate of Designations will contain affirmative covenants with respect to maintenance of existence, compliance with laws and payment of taxes, which shall be substantially consistent with (but no more restrictive) than
those to be contained in the New Credit Agreement as in effect on the Issue Date, with such modifications as are customary for a preferred equity security to be mutually agreed among the Issuer and the Purchaser. |
|
|
Limits on Transferability: |
|
At any time from and after the Issue Date, Preferred Equity may be transferred only with the Issuers prior written consent, subject to
customary exceptions for (i) transfers by Coatue to its affiliates and related funds, excluding in any event any portfolio company of Coatue and its affiliates and related funds and (iii) pledges in connection with bona fide fund level
indebtedness. The Purchaser shall be permitted to transfer its Preferred Equity without notice or consent being required to any person upon any failure to comply with its obligations under Mandatory Redemption above, or any voluntary
bankruptcy, liquidation, dissolution or winding up of the Issuer or the Borrower.
Notwithstanding anything to the contrary herein, from and after the fifth anniversary of the Issue Date, the Preferred Equity may be transferred without notice
or consent being required to a qualified institutional buyer as defined pursuant to Rule 144A promulgated under the Securities Act of 1933, as amended. |
|
|
Governance Rights: |
|
None pursuant to the Purchase Agreement or Certificate of Designations. The foregoing shall not impact or affect any governance rights that the Purchaser may have as set forth in any other documentation. |
|
|
Registration Rights: |
|
None. |
|
|
Preemptive Rights: |
|
None. |
|
|
Applicable Law: |
|
As to the Certificate of Designations: Delaware. |
|
|
|
|
As to the Purchase Agreement: New York. |
B-8
|
|
|
Tax Provisions: |
|
From and after the Closing Date, the Issuer will be treated as a domestic C corporation for U.S. federal income tax purposes and will not
take any action that would cause it not to be a domestic C corporation for U.S. federal income tax purposes or could otherwise cause any holder of the Preferred Equity (each, a Holder and, collectively, the
Holders) to own an interest in an entity that is not a domestic C corporation for U.S. federal income tax purposes, in each case without the consent of each of the Holders, which consent may be withheld in a Holders
sole discretion. The Preferred Equity Documentation will include provisions
reflecting the parties intent that (i) the Preferred Equity is intended to be treated as equity (and not debt) for U.S. federal income tax purposes, (ii) Holders shall not be required to include in income as a dividend for U.S.
federal income tax purposes any amounts in respect of the Preferred Equity unless and until such dividends are declared and paid in cash, and (iii) any redemption of the Preferred Equity from a Holder thereof, whether in part or in full,
qualifies as a sale or exchange of such Preferred Stock pursuant to Section 302 of the Code and not as a distribution for U.S. federal income tax purposes. The Issuer will, and will cause any paying agent or other agent of the Issuer to, report
consistently with, and take no positions or actions inconsistent with (including on any IRS Form 1099 or any other information return or by way of withholding), the intended tax treatment set forth in the preceding clauses (i) through (iii)
(the Intended Tax Treatment) unless otherwise required by a change in law or a final determination of a taxing authority which, in each case, is binding on the Issuer.
The Issuer will represent that it is not, and does not anticipate becoming, a United
States real property holding corporation (USRPHC) within the meaning of Section 897(c)(2) of the Code. The Issuer shall (a) provide to any Holder, within ten (10) days of such Holders written request,
(i) a certification that the Preferred Equity does not constitute a United States real property interest, in accordance with Treasury Regulations Section 1.897-2(h)(1) or
(ii) written notice of its legal inability to provide such a certification and (b) in connection with the provision of any certification pursuant to the preceding clause (a)(i), comply with the notice provisions set forth in Treasury
Regulations Section 1.897-2(h). In the event the Issuer becomes aware of any facts or circumstances that could reasonably be expected to cause it to become a USRPHC, the Issuer shall promptly notify the
Holders. |
B-9
|
|
|
|
|
The Issuer shall provide any information reasonably requested by the Holders to enable the Holders (and their direct or indirect equity
owners) to comply with their U.S. federal income tax reporting and withholding obligations, including, but not limited to, an estimate or determination (and accompanying certification in accordance with Treasury Regulations Section 1.1441-3(c)(2)(ii)(A)) of the amount of the Issuers current and accumulated earnings and profits in any taxable year where such estimate or determination is relevant to determining the amount (if
any) of any distribution or deemed distribution received by the Holders from the Issuer that is properly treated as a dividend for U.S. federal income tax purposes.
The Purchaser will provide (i) an IRS Form W-9 or (ii) IRS form W-8
claiming a complete exemption from U.S. withholding tax on dividends. Subject to compliance with the Intended Tax Treatment, the Issuer (and any other applicable withholding agent) may deduct and withhold any amounts required to be deducted and
withheld under applicable law with respect to the Preferred Equity (and may set off any such amounts required to be withheld against any dividends or other payments on the Preferred Equity). |
|
|
Fees and Expenses: |
|
The Preferred Equity Documentation will contain expense reimbursement and indemnity provisions substantially consistent with the Commitment Letter. |
B-10
Exhibit C
Project Wildcat
Preferred Commitment Letter
Summary of Additional Conditions1
The funding of the Preferred Financing by the Purchaser on the Closing Date is subject solely to the satisfaction or waiver by the Purchaser
of the applicable conditions set forth in the section entitled Conditions in the body of the Commitment Letter and the following conditions (subject in all respects to the Limited Conditionality Provisions):
1. Since the date of the Acquisition Agreement, no Material Adverse Effect (as defined in the Acquisition Agreement as in effect on the
Signing Date) shall have occurred and be continuing that would result in the failure of a condition precedent to your obligation to fund the Acquisition under the Acquisition Agreement or that would give you the right (taking into account any notice
and cure provisions) to terminate your obligations pursuant to the terms of the Acquisition Agreement.
2. The Acquisition shall have been
consummated, or substantially simultaneously with the purchase of the Preferred Financing and the initial borrowings under the Facilities, shall be consummated, in all material respects in accordance with the terms of the Acquisition Agreement,
after giving effect to any modifications, amendments, consents or waivers by Buyer (or any of its affiliates) thereto, other than those modifications, amendments, consents or waivers by Buyer (or its affiliate) that are materially adverse to the
interests of the Purchaser in its capacity as such when taken as a whole (it being understood that any modification, amendment, consent or waiver to the definition of Material Adverse Effect shall be deemed to be materially adverse to the interests
of the Purchaser), unless consented to in writing by the Purchaser (such consent not to be unreasonably withheld, delayed or conditioned); provided that the Purchaser shall be deemed to have consented to such amendment, supplement, waiver or
modification unless they shall object in writing thereto within three business days of being notified or otherwise becoming aware of such amendment, waiver, modification, consent or waiver being delivered; provided, further, that, any
dispositions permitted under the Acquisition Agreement shall not be deemed materially adverse to the interests of the Purchaser in its capacity as such, whether taken individually or in the aggregate; provided, further, that without limiting any
other rights and/or obligations of this Exhibit C, any modification, amendment or express waiver or consents by Buyer (or its affiliate) that results in (a) a reduction in the Acquisition Consideration shall not be deemed to be materially
adverse to the Purchaser if such reduction is applied (i) first to reduce the Equity Contribution to 35.0%, subject to the Minimum Common Equity Contribution of at least 30.0% and (ii) thereafter, (I) 65.0% to reduce the Initial Term A
Facility until the amount of commitments in respect of the Initial Term A Facility is $0, and thereafter to reduce the amount of commitments in respect of the Initial Term B Facility and the Margin Bridge Facility and (II) 35.0% to reduce the Equity
Contribution, subject to the Minimum Common Equity Contribution of at least 30.0% and (b) an increase in the Acquisition Consideration shall be deemed to be materially adverse to the Purchaser. Any reduction in the amount of the Equity
Contribution shall be pro rata among the components of common equity contribution and the Preferred Equity or, at the option of the Purchaser, shall reduce only the common equity contribution.
1 |
All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to
which this Exhibit C is attached, including Exhibits A and B thereto. In the case of any such capitalized term that is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit C shall be determined by reference
to the context in which it is used. |
C-1
3. Confirmation from you that the Common Equity Contribution shall have been made, or
substantially simultaneously with the funding of the Preferred Financing, shall be made, in at least the amount set forth in Exhibit A to the Commitment Letter.
4. (a) Substantially simultaneously with the initial borrowing under the Term Facilities and the consummation of the Acquisition, the
Refinancing shall be consummated and (b) the borrowing of the Facilities shall have been made, or substantially simultaneously with the funding of the Preferred Financing, shall be made, in an aggregate amount not to exceed that which is set
forth with respect to the Facilities on Exhibit B of the Commitment Letter.
5. The Purchaser shall have received (a) audited
consolidated balance sheets of the Target and its consolidated subsidiaries as at the end of, and related consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash
flows of the Target and its consolidated subsidiaries for, the two most recently completed fiscal years ended at least 120 days prior to the Closing Date and (b) unaudited condensed consolidated balance sheets of the Target and its consolidated
subsidiaries as at the end of, and related unaudited condensed consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash flows of the Target and its consolidated
subsidiaries for, each subsequent fiscal quarter (other than the last fiscal quarter of the fiscal year) of the Target and its consolidated subsidiaries subsequent to the last fiscal year for which financial statements were prepared pursuant to the
preceding clause (a) and ended at least 60 days before the Closing Date (in the case of this clause (b), without footnotes). The Purchaser hereby acknowledges (x) receipt of the audited financial statements referred to in clause
(a) above for the fiscal years ended December 31, 2021, December 31, 2022 and December 31, 2023, (y) receipt of the unaudited financial statements referred to in clause (b) above for the three months ended March 31,
2024 and (z) that the public filing by the Target with the Securities and Exchange Commission of any required audited financial statements on Form 10-K or required unaudited financial statements on Form 10-Q, in each case, will satisfy the requirements under clause (a) or (b), as applicable, of this paragraph.
6. The Closing Date shall have occurred on or before the Expiration Date.
7. The Purchaser shall have received at least three business days prior to the Closing Date, all documentation and other information about
Holdings, the Borrower and the Issuer that shall have been reasonably requested by the Purchaser in writing at least ten business days prior to the Closing Date and that the Purchaser reasonably determines is required by United States regulatory
authorities under applicable know your customer and anti-money laundering rules and regulations, including without limitation the PATRIOT Act, including, if the Issuer qualifies as a legal entity customer under the Beneficial
Ownership Regulation (as defined below), a Beneficial Ownership Certification (as defined below) in relation to the Issuer. Beneficial Ownership Certification means a certification regarding beneficial ownership required by the
Beneficial Ownership Regulation (as defined below), which certification shall be substantially similar in substance to the form of Certification Regarding Beneficial Owners of Legal Entity Customers included as Appendix A to the Beneficial Ownership
Regulation. Beneficial Ownership Regulation means 31 C.F.R. § 1010.230.
C-2
8. Subject in each case to the Limited Conditionality Provisions, (a) the Specified
Representations shall be accurate in all material respects; provided that, any Specified Representations qualified by materiality shall be, as so qualified, accurate in all respects, and (b) the Specified Acquisition Agreement
Representations shall be accurate in all material respects provided that, any Specified Acquisition Agreement Representations qualified by materiality shall be, as so qualified, accurate in all respects.
9. Subject in all respects to the Limited Conditionality Provisions, (a) the execution and delivery by the Issuer of the Preferred Equity
Documentation (as defined in Exhibit B to the Commitment Letter) which shall be in accordance with the terms of the Commitment Letter and the Term Sheet and (b) delivery to the Purchaser of the following (the Closing
Deliverables): (i) customary legal opinions, customary officers closing certificates, organizational documents, customary evidence of authorization and good standing certificates in jurisdictions of formation/organization, in
each case with respect to the Issuer and (ii) a solvency certificate, dated as of the Closing Date, after giving effect to the Transactions, substantially in the form of Annex II to this Commitment Letter, of a senior financial executive or
officer of the Issuer (or, at the option of the Issuer, a third party opinion as to the solvency of the Issuer and its subsidiaries on a consolidated basis issued by a nationally recognized firm).
10. All fees required to be paid on the Closing Date pursuant to the Commitment Letter and reasonable out-of-pocket expenses required to be paid on the Closing Date pursuant to the Commitment Letter, to the extent invoiced at least three business days prior to the Closing Date (except as otherwise reasonably
agreed by the Issuer), shall, upon the funding of the Preferred Financing, have been, or will be substantially simultaneously, paid (which amounts may be offset against the proceeds of the Preferred Financing).
C-3
Annex I
Closing Payment
The Closing Payment
payable to the Purchaser shall be equal to 2.00% of the amount of the Purchasers Commitment that is funded on the Closing Date.
Annex I-1
Annex II
Solvency Certificate
[ ], 202[ ]
This Solvency Certificate (this Certificate) is delivered pursuant to Section [ ] of the Purchase Agreement,
dated as of [ ] (as amended as of the date hereof, and as it may be further amended, supplemented or otherwise modified, the Purchase Agreement), by and among [ ] (the
Issuer) and [ ], a [ ]. Unless otherwise defined herein, capitalized terms used in this Certificate shall have the meanings set forth in the Purchase Agreement.
I, [ ], the [ ] of the Issuer, in that capacity only and not in my individual capacity (and without personal
liability), DO HEREBY CERTIFY on behalf of the Issuer that as of the date hereof, and based upon facts and circumstances as they exist as of the date hereof (and disclaiming any responsibility for changes in such facts and circumstances after the
date hereof), that:
1. For purposes of this certificate, the terms below shall have the following definitions:
(a) Fair Value
The
amount at which the assets (both tangible and intangible), in their entirety, of the Issuer and its subsidiaries taken as a whole would change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each
having reasonable knowledge of the relevant facts, with neither being under any compulsion to act.
(b) Present Fair Salable
Value
The amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the
Issuer and its subsidiaries taken as a whole are sold with reasonable promptness in an arms-length transaction under present conditions for the sale of comparable business enterprises insofar as such
conditions can be reasonably evaluated.
(c) Liabilities
The recorded liabilities (including contingent liabilities that would be recorded in accordance with GAAP) of the Issuer and its subsidiaries
taken as a whole, as of the date hereof after giving effect to the consummation of the Transactions, determined in accordance with GAAP consistently applied.
(d) Will be able to pay their Liabilities as they mature
As of the date hereof, the Issuer and its subsidiaries on a consolidated basis taken as a whole will have sufficient assets and cash flow to
pay their Liabilities as those liabilities mature or (in the case of contingent Liabilities) otherwise become payable, in light of business conducted or anticipated to be conducted by the Issuer and its subsidiaries as reflected in the projected
financial statements and in light of the anticipated credit capacity.
Annex II-1
(e) Do not have Unreasonably Small Capital
The Issuer and its subsidiaries on a consolidated basis taken as a whole after consummation of the Transactions is a going concern and has
sufficient capital to reasonably ensure that it will continue to be a going concern immediately following the consummation of the Transactions. I understand that unreasonably small capital depends upon the nature of the particular
business or businesses conducted or to be conducted, and I have reached my conclusion based on the needs and anticipated needs for capital of the business conducted or anticipated to be conducted by the Issuer and its subsidiaries on a consolidated
basis as reflected in the projected financial statements and in light of the anticipated credit capacity.
2. Based on and subject to the
foregoing, I hereby certify on behalf of the Issuer that after giving effect to the consummation of the Transactions, it is my opinion that (i) the Fair Value of the assets of the Issuer and its subsidiaries on a consolidated basis taken as a
whole exceeds their Liabilities, (ii) the Present Fair Salable Value of the assets of the Issuer and its subsidiaries on a consolidated basis taken as a whole exceeds their Liabilities; (iii) the Issuer and its subsidiaries on a
consolidated basis taken as a whole do not have Unreasonably Small Capital; and (iv) the Issuer and its subsidiaries taken as a whole will be able to pay their Liabilities as they mature.
3. In reaching the conclusions set forth in this Certificate, the undersigned has made such investigations and inquiries as the undersigned
has deemed appropriate, having taken into account the nature of the particular business anticipated to be conducted by the Issuer and the Subsidiaries after consummation of the transactions contemplated by the Purchase Agreement.
IN WITNESS WHEREOF, I have executed this Certificate as of the date first written above.
|
|
|
By: |
|
|
|
|
Name: |
|
|
Title: [Chief Financial Officer] |
Annex II-2
Exhibit (B)(5)
Meritage Fund Select I LLC
66
Field Point Road
Greenwich, CT 06830
July 29, 2024
WILDCAT EGH HOLDCO, L.P.
c/o
Silver Lake Partners
55 Hudson Yards
550 West 34th Street, 40th Floor
New York, NY 10001
Attention: Egon Durban
Project Wildcat
Preferred Equity Commitment Letter
Ladies and Gentlemen:
This letter (together
with the exhibits hereto, this Commitment Letter) sets forth the commitment of Meritage Fund Select I LLC, a Delaware limited liability company (Meritage, we, us or the
Purchaser), subject to the terms and conditions contained herein, to provide or cause to be provided to Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (Buyer or
you), a portion of the Preferred Financing to consummate the Transactions described in the Transaction Description attached hereto as Exhibit A (the Transaction Description). As used herein, the
Preferred Financing shall mean $25,000,000 of aggregate preferred equity financing that will be used to consummate such Transactions. Capitalized terms used but not defined in this Commitment Letter shall have the meanings set
forth in the Exhibits to this Commitment Letter.
1. |
Commitment. The Purchaser hereby commits, subject to the terms and conditions set forth herein, that, at
(and subject to) the closing of the Acquisition (Closing), it shall provide or shall cause to be provided to Buyer, in exchange for a preferred equity interest in Endeavor Group Holdings, Inc. (Issuer), to be
issued on the terms set forth on Exhibit B, for an amount equal to $25,000,000 of the Preferred Financing (the Commitment). |
Ratings Event means the receipt by the Issuer of a credit rating or an advisory or prospective credit rating from
Moodys Investor Service, Inc. and S&P Global Ratings Inc. of B1 (or better) or B+ (or better), respectively, which ratings give effect to all indebtedness and preferred equity interests expected to be incurred or be outstanding at Closing
(including the Commitment).
2. |
Information. You hereby represent and warrant that (a) all written information and written data
(such information and data, other than (i) estimates, forecasts and other projections (the Projections) and (ii) information of a general economic or industry specific nature, the Information) (in the
case of Information regarding the Target and its subsidiaries and its and |
|
their respective businesses, to the best of your knowledge), that has been or will be made available to the Purchaser directly or indirectly by you, the Target or by any of your or its
subsidiaries or representatives, in each case, on your behalf in connection with the transactions contemplated hereby, when taken as a whole and together with the reports and other information filed by the Target or any of its subsidiaries with the
Securities and Exchange Commission (including the risk factors therein), is or will be, when furnished, correct in all material respects and does not or will not, when furnished and when taken as a whole, contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made (after giving effect to all supplements and updates
thereto from time to time) and (b) the Projections that have been or will be made available to the Purchaser by you or by any of your subsidiaries or representatives, in each case, on your behalf in connection with the transactions contemplated
hereby have been, or will be, prepared in good faith based upon assumptions that are believed by you to be reasonable at the time prepared and at the time the related Projections are so furnished to the Purchaser; it being understood that the
Projections are as to future events and are not to be viewed as facts, the Projections are subject to significant uncertainties and contingencies, many of which are beyond your control, that no assurance can be given that any particular Projections
will be realized and that actual results during the period or periods covered by any such Projections may differ significantly from the projected results and such differences may be material. You agree that, if at any time prior to the closing of
the Acquisition and the funding of the Preferred Financing (the Closing Date), you become aware that any of the representations and warranties in the preceding sentence would be incorrect in any material respect if the Information
and the Projections were being furnished, and such representations and warranties were being made, at such time, then you will (or, with respect to the Information and Projections relating to the Target and its subsidiaries, will use commercially
reasonable efforts to) promptly supplement the Information and the Projections such that such representations and warranties are correct in all material respects under those circumstances (or, in the case of the Information relating to the Target
and its subsidiaries and its and their respective businesses, to the best of your knowledge, such representations and warranties are correct in all material respects under those circumstances). |
3. |
Closing Payments. As consideration for the Commitment hereunder, Issuer agrees, if and only if the
Closing of the portion of the Preferred Financing for which the Purchaser has provided a Commitment and the Transactions occur, to pay, or cause to be paid, to the Purchaser a non-refundable closing payment as
set forth on Annex I (the Closing Payment), which the Purchaser may elect to net fund. |
4. |
Conditions. The Commitment of the Purchaser hereunder shall be subject solely to the occurrence of the
Ratings Event and the conditions expressly set forth in Exhibit C to this Commitment Letter (the Funding Conditions), and upon satisfaction (or waiver by the Purchaser in accordance with this Commitment Letter) of such
conditions, the initial funding of the Commitment of the Purchaser shall occur; it being understood that there are no conditions (implied or otherwise) to the commitment hereunder, including compliance with the terms of this Commitment Letter other
than the Funding Conditions that are expressly stated to be conditions to the issuance and sale of the Preferred Equity on the Closing Date. |
2
Notwithstanding anything to the contrary in this Commitment Letter (including each of the
Exhibits attached hereto) or any other letter agreement or other undertaking concerning the financing of the Transactions to the contrary, (i) the only representations and warranties relating to you or the Target or your or their respective
subsidiaries or businesses or otherwise, the accuracy of which shall be a condition to the funding of the Preferred Financing on the Closing Date shall be (a) such of the representations and warranties (if any) made by, or with respect to, the
Target and its subsidiaries in the Acquisition Agreement as are material to the interests of the Purchaser in its capacity as such, but only to the extent that you (or your affiliate) have the right (taking into account any applicable notice and
cure provisions) to terminate your (and/or its) obligations under the Acquisition Agreement or decline to consummate the Acquisition or otherwise results in a failure of a condition precedent in the Acquisition Agreement (in each case, in accordance
with the terms thereof) as a result of a breach of such representations and warranties in the Acquisition Agreement (to such extent, the Specified Acquisition Agreement Representations) and (b) the Specified Representations
(as defined below) made by the Issuer in the Preferred Equity Documentation, and (ii) the terms of the Preferred Equity Documentation and the Closing Deliverables (as defined in Exhibit C to this Commitment Letter) shall be in a form
such that they do not impair the issuance of the Preferred Equity on the Closing Date assuming the Funding Conditions are satisfied (or waived in writing by the Purchaser in its sole discretion). For purposes hereof, Specified
Representations means the applicable representations and warranties of Issuer to be set forth in the Preferred Equity Documentation relating to organizational corporate existence of Issuer as of the Closing Date; tax status of the Issuer
as a corporation; power and authority, due authorization, execution, delivery and enforceability, in each case, related to, the issuance of the Preferred Financing and performance of the applicable definitive documentation related to the Preferred
Financing; and the issuance of the Preferred Financing does not conflict with the organizational documents of Issuer, or any preemptive rights, rights of first refusal or rights of first offer (or similar rights) applicable to the Preferred
Financing, in each case, after giving effect to any written waivers obtained from any persons having such rights; solvency as of the Closing Date (after giving effect to the Transactions) of the Issuer and its subsidiaries on a consolidated basis
(solvency to be defined in a manner consistent with the manner in which solvency is determined in the solvency certificate to be delivered in the form set forth in Annex II); the Investment Company Act; the use of proceeds of the issuance and sale
of the Preferred Financing not violating the PATRIOT Act (as defined below), OFAC or FCPA; valid issuance of the Preferred Equity and that the Preferred Equity is fully paid and non-assessable; and status of
the Preferred Equity as senior in payment priority and liquidation preference to all equity of the Issuer. This paragraph, and the provisions herein, shall be referred to as the Limited Conditionality Provisions.
5. |
Limitation on Liability; Indemnity; Settlement. |
|
a. |
Limitation on Liability. |
Notwithstanding any other provision of this Commitment Letter, (i) no Indemnified Person or Related Indemnified Person shall be liable for
any damages arising from the use by others of information or other materials obtained through internet, electronic, telecommunications or other information transmission systems, except to the extent that such damages have resulted from the willful
misconduct, bad faith or gross negligence of
3
such Indemnified Person or any Related Indemnified Person (as determined by a court of competent jurisdiction in a final and non-appealable decision) and
(ii) none of you (or any of your subsidiaries), the Investors (or any of their respective affiliates), the Target (or any of its subsidiaries or affiliates), any Indemnified Person or any Related Indemnified Person shall be liable for any
indirect, special, punitive or consequential damages (including, without limitation, any loss of profits, business or anticipated savings) in connection with this Commitment Letter, the Transactions (including the Preferred Financing and the use of
proceeds thereunder), or with respect to any activities related to the Preferred Financing, including the preparation of this Commitment Letter and the definitive documentation of the Preferred Financing; provided that nothing in this paragraph
shall limit your indemnity and reimbursement obligations to the extent that such indirect, special, punitive or consequential damages are included in any claim by a third party with respect to which the applicable Indemnified Person is entitled to
indemnification under subsection (b) of this Section 5.
To induce the Purchaser to enter into this Commitment Letter and to proceed with the definitive documentation of the Preferred Financing, you
agree to indemnify and hold harmless the Purchaser, its affiliates and its and its affiliates officers, directors, employees, agents, partners, owners, controlling persons, advisors, attorneys and other representatives of each of the foregoing
and their successors and permitted assigns under this Commitment Letter (each, an Indemnified Person), from and against any and all losses, claims, damages and liabilities of any kind or nature and reasonable and documented or
invoiced out-of-pocket fees and expenses, joint or several, to which any such Indemnified Person may become subject to the extent arising out of, resulting from, or in
connection with any actual or threatened claim, litigation, investigation or proceeding (including any inquiry or investigation) in connection with this Commitment Letter (including Exhibit B hereto (the
Term Sheet)), the Transactions or any related transaction contemplated hereby or thereby, the Preferred Financing or any use of the proceeds thereof (any of the foregoing, a Proceeding),
regardless of whether any such Indemnified Person is a party thereto, whether or not such Proceedings are brought by you, your equity holders, affiliates or creditors or any other third person, and to promptly reimburse after receipt of a written
request, each such Indemnified Person for any reasonable and documented or invoiced out-of-pocket legal fees and expenses incurred in connection with investigating or
defending any of the foregoing by one firm of counsel for all such Indemnified Persons, taken as a whole and, if necessary, by a single firm of local counsel in each appropriate jurisdiction (which may include a single firm of special counsel acting
in multiple jurisdictions) for all such Indemnified Persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Person affected by such conflict notifies you of the existence of such conflict and
thereafter retains its own counsel, by another firm of counsel for such affected Indemnified Person) or other reasonable and documented or invoiced out-of-pocket fees
and expenses incurred in connection with investigating, responding to, or defending any of the foregoing; provided that the foregoing indemnity will not, as to any Indemnified Person, apply to losses, claims, damages, liabilities or related
expenses to the extent that they have resulted from (i) the willful misconduct, bad faith or gross negligence of such Indemnified Person or any Related Indemnified Person
4
(as defined below) (as determined by a court of competent jurisdiction in a final and non-appealable decision), (ii) a material breach of the obligations
of such Indemnified Person or any Related Indemnified Person under this Commitment Letter (as determined by a court of competent jurisdiction in a final and non-appealable decision) or (iii) any
Proceeding solely between or among Indemnified Persons not arising from any act or omission by you or any of your affiliates. The foregoing provisions in this paragraph shall be superseded, in each case, to the extent covered thereby by the
applicable provisions contained in the definitive documentation of the Preferred Financing upon execution and delivery thereof and thereafter shall have no further force and effect.
Related Indemnified Person of an Indemnified Person means (1) any controlling person or any affiliate of such
Indemnified Person, (2) the respective directors, officers, or employees of such Indemnified Person or any of its controlling persons or any of its affiliates and (3) the respective agents, advisors, attorneys and representatives of such
Indemnified Person or any of its controlling persons or any of its affiliates, in the case of this clause (3), acting at the instructions of such Indemnified Person, controlling person or such affiliate (it being understood and agreed that any
agent, advisor or representative of such Indemnified Person or any of its controlling persons or any of its affiliates engaged to represent or otherwise advise such Indemnified Person, controlling person or affiliate in connection with the
Transactions shall be deemed to be acting at the instruction of such person).
You shall not be liable for any settlement of any Proceeding effected without your written consent (which consent shall not be unreasonably
withheld, conditioned or delayed), but if settled with your written consent or if there is a final and non-appealable judgment by a court of competent jurisdiction in any such Proceeding, you agree to
indemnify and hold harmless each Indemnified Person from and against any and all losses, claims, damages, liabilities and reasonable and documented legal or other
out-of-pocket expenses by reason of such settlement or judgment in accordance with and to the extent provided in the other provisions of this Section 5.
You shall not, without the prior written consent of any Indemnified Person (which consent shall not be unreasonably withheld, conditioned or
delayed) (it being understood that the withholding of consent due to non-satisfaction of any of the conditions described in clauses (i), (ii) and (iii) of this sentence shall be deemed reasonable),
effect any settlement of any pending or threatened Proceedings in respect of which indemnity could have been sought hereunder by such Indemnified Person unless such settlement (i) includes an unconditional release of such Indemnified Person in
form and substance reasonably satisfactory to such Indemnified Person from all liability or claims that are the subject matter of such proceedings, (ii) does not include any statement as to or any admission of fault, culpability, wrong doing or
a failure to act by or on behalf of any Indemnified Person and (iii) contains customary confidentiality provisions with respect to the terms of such settlement. Each Indemnified Person shall be severally obligated to refund or return any and
all amounts paid by you under this Section 5 to the extent such Indemnified Person is not entitled to payment of such amounts in accordance with the terms hereof (as determined by a court of competent jurisdiction in a final and non-appealable judgment).
5
6. |
Confidentiality. You agree that you will not disclose, directly or indirectly, prior to your acceptance
hereof, this Commitment Letter, the Term Sheet, the other exhibits and attachments hereto or the contents of each thereof, or the Purchasers activities pursuant hereto or thereto, to any person or entity without the prior written approval of
the Purchaser (such approval not to be unreasonably withheld, delayed or conditioned), except (a) to the Investors (as defined in Exhibit A) and to any of your or the Investors affiliates and your and their respective officers,
directors, employees, agents, attorneys, accountants, advisors, controlling persons and equity holders and to actual and potential co-investors who are informed of the confidential nature thereof, on a
confidential and need-to-know basis, (b) if the Purchaser consents in writing to such proposed disclosure or (c) pursuant to an order of any court or
administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal process or to the extent requested or required by governmental and/or regulatory
authorities, in each case based on the reasonable advice of your legal counsel (in which case you agree, to the extent practicable and not prohibited by applicable law, rule or regulation, to inform us promptly thereof prior to disclosure); provided
that (i) you may disclose this Commitment Letter and the contents hereof (other than with respect to Section 3 hereof and information with respect to fees, compensation or discounts within the Term Sheet) to the Target, its subsidiaries
and affiliates and its and their respective officers, directors, employees, agents, attorneys, accountants, advisors and controlling persons, on a confidential and
need-to-know basis, (ii) you may disclose the Commitment Letter and its contents (including the Term Sheet and other exhibits and attachments hereto) (but not the
contents of Section 3 hereof or information with respect to fees, compensation or discounts within the Term Sheet) in any syndication or other marketing materials in connection with the Credit Facilities (as defined in Exhibit A) and
Margin Bridge Facility (as defined in Exhibit A) (including any marketing materials and information memorandum used in connection therewith), (iii) you may disclose the aggregate fee amounts contained in this Commitment Letter as part of
Projections, pro forma information or a generic disclosure of aggregate sources and uses related to fee amounts related to the Transactions to the extent customary or required in any marketing materials or in connection with the Credit Facilities or
in connection with any public or regulatory filing requirement relating to the Transactions (and then only to the extent aggregate with all other fees and expenses of the Transactions and not presented as an individual line item unless required by
applicable law, rule or regulation), (iii) you may disclose the Term Sheet and other exhibits and attachments to the Commitment Letter, and the contents thereof, to potential co-investors and to rating
agencies in connection with obtaining public ratings for the Borrower (as defined in Exhibit A) and the Credit Facilities, (iv) you may disclose this Commitment Letter and the contents thereof (including the Term Sheet and other exhibits
and attachments hereto) to the initial lenders and any prospective lenders under the Credit Facilities and Margin Bridge Facility, the custodian and the transfer agent in connection with the Margin Loan facility, any additional prospective investor
in the Preferred Financing and to any such persons affiliates and their respective officers, directors, employees, agents, attorneys, accountants and other advisors, on a confidential and need-to-know basis and (v) in connection with any remedy or enforcement of any right hereunder. |
6
The Purchaser and its affiliates will use all
non-public information provided to them or such affiliates by or on behalf of you hereunder or in connection with the Acquisition and the related Transactions solely for the purpose of negotiating, evaluating
and consummating the transactions contemplated hereby and shall treat confidentially all such information and shall not publish, disclose or otherwise divulge, such information; provided that nothing herein shall prevent the Purchaser and its
affiliates from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or
compulsory legal process based on the reasonable advice of counsel (in which case the Purchaser agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory authority or governmental regulatory
authority exercising examination or regulatory authority), to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (b) upon the request or demand of any regulatory
authority having jurisdiction, or purporting to have jurisdiction, over the Purchaser or any of its affiliates (in which case the Purchaser agrees (except with respect to any audit or examination conducted by bank accountants or any self-regulatory
authority or governmental regulatory authority exercising examination or regulatory authority), to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (c) to the
extent that such information becomes publicly available other than by reason of improper disclosure by the Purchaser or any of its Related Parties (as defined below) in violation of any confidentiality obligations owing to you, the Investors,
Issuer, the Target or any of your or their respective subsidiaries and affiliates, (d) to the extent that such information is or was received by the Purchaser or any of its Related Parties from a third party that is not, to the Purchasers
knowledge, subject to contractual or fiduciary confidentiality obligations owing to you, the Investors, Issuer, the Target or any of your or their respective subsidiaries and affiliates, (e) to the extent that such information is independently
developed by the Purchaser or any of its Related Parties without the use of any confidential information, (f) to the Purchasers affiliates and to its and their respective employees, officers, partners, directors, legal counsel,
independent auditors, rating agencies, professionals and other experts or agents and existing and prospective limited partners and financing sources who need to know such information in connection with the Transactions and who are informed of the
confidential nature of such information and who are subject to customary confidentiality obligations and who have been advised of their obligation to keep information of this type confidential (collectively, the Related Parties),
with the Purchaser, to the extent within its control, responsible for such persons compliance with this paragraph, (g) to the extent you consent in writing to any specific disclosure or (h) to the extent such information was already
in the Purchasers possession prior to any duty or other understanding of confidentiality entered into in connection with the Transactions. In the event that the Preferred Financing is funded, the Purchaser and its respective affiliates,
if any, obligations under this paragraph shall terminate automatically and be superseded by the confidentiality provisions in the definitive documentation of the Preferred Financing upon the initial funding thereunder to the extent that such
provisions are binding on the Purchaser.
Subject to the immediately preceding sentence, the confidentiality provisions set forth in this
Section 6 shall survive the termination of this Commitment Letter and expire and shall be of no further effect after the second anniversary of the date hereof.
7
7. |
Absence of Fiduciary Relationship. The Purchaser, together with its respective affiliates (collectively,
the Sponsor Entities), is a financial investment firm and as such from time to time may effect transactions for its own account, and hold long or short positions in debt or equity securities or loans of companies that may be the
subject of the transactions contemplated hereby. You also acknowledge that the Sponsor Entities have no obligation to use in connection with the transactions contemplated hereby, or to furnish to you, confidential information obtained from other
companies or other persons. The Sponsor Entities may have economic interests that conflict with your economic interests and those of the Target. You acknowledge and agree that (a)(i) the agreements described herein regarding the Preferred Equity are
arms-length commercial transactions between you and your affiliates, on the one hand, and the Purchaser, on the other hand, that do not directly or indirectly give rise to, nor do you rely on, any
fiduciary duty on the part of the Sponsor Entities, and (ii) you will not assert, to the fullest extent permitted by law, any claims that you may have against the Purchaser or any of its affiliates for alleged breach of fiduciary duty arising
by virtue of this Commitment Letter and (b) in connection with the transactions contemplated hereby, none of the Sponsor Entities have any obligation to you or your affiliates, except those obligations of Purchaser expressly set forth in this
Commitment Letter and any other agreement with you or any of your affiliates. |
8. |
Miscellaneous. This Commitment Letter and the commitment hereunder shall not be assignable by any party
hereto (other than (i) any assignment occurring as a matter of law pursuant to, or otherwise substantially simultaneously with, the Acquisition on the Closing Date, in each case to the Target, Merger Sub or the Issuer, (ii) by you to
(a) Target, Merger Sub or the Issuer substantially simultaneously with the Acquisition on the Closing Date or (b) a U.S. domestically organized entity, in each case, so long as such entity is, or will be, controlled by you or the Investors
after giving effect to the Transactions and shall (directly or indirectly through one or more wholly-owned subsidiaries) own the Target and the Issuer and agrees to be bound by the terms hereof or (iii) by Purchaser to affiliated investment
entities and funds, in each case, managed by Meritage Group LP who shall agree to be bound by the terms hereof) without the prior written consent of each other party hereto (such consent not to be unreasonably withheld, conditioned or delayed) (and
any attempted assignment without such consent shall be null and void). This Commitment Letter and the commitment hereunder are intended to be solely for the benefit of the parties hereto (and Indemnified Persons) and do not and are not intended to
confer any benefits upon, or create any rights in favor of, any person other than the parties hereto (and Indemnified Persons to the extent expressly set forth herein). The Purchaser reserves the right to employ the services of their respective
affiliates or branches in providing services contemplated hereby and to allocate, in whole or in part, to their affiliates or branches certain fees payable to the Purchaser in such manner the Purchaser and its affiliates or branches may agree in
their sole discretion, and, to the extent so employed, such affiliates and branches shall be entitled to the benefits and protections afforded to, and subject to the provisions governing the conduct of the Purchaser hereunder. This Commitment Letter
may not be amended or any provision hereof waived or modified except by an instrument in writing signed by the Purchaser and you. This Commitment Letter may be executed in any number of counterparts, each of which shall be deemed an original and all
of which when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission or other electronic transmission (i.e., a pdf or tif)
shall be effective as delivery of a manually executed counterpart thereof. All Electronic Signatures (including, without limitation, facsimile or .pdf) on or associated with any |
8
|
Communication shall be valid and binding on the applicable signatory to the same extent as a manual, original signature, and that any Communication entered into by Electronic Signature, will
constitute such signatorys legal, valid and binding obligation enforceable against such signatory in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered to the other signatories. This
Commitment Letter (including the exhibits hereto), together with any other letter agreement entered into with the Purchaser on or prior to the date hereof, (i) are the only agreements that have been entered into among the parties hereto with
respect to our commitment with respect to the Preferred Financing and (ii) supersede all prior understandings, whether written or oral, among us with respect to the Preferred Financing and sets forth the entire understanding of the parties
hereto with respect thereto. THIS COMMITMENT LETTER, AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER, OR RELATED TO, THIS COMMITMENT LETTER (INCLUDING, WITHOUT LIMITATION, ANY CLAIMS SOUNDING IN CONTRACT LAW OR TORT LAW ARISING OUT OF THE
SUBJECT MATTER HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; provided that, notwithstanding the foregoing, it is understood and agreed that (a) the interpretation of the definition of
Material Adverse Effect (as defined in the Acquisition Agreement) (and whether or not a Material Adverse Effect has occurred), (b) the determination of the accuracy of any Specified Acquisition Agreement Representation and whether as a
result of any inaccuracy thereof you (or your affiliate) have the right (taking into account any applicable cure provisions) to terminate your obligations under the Acquisition Agreement or decline to consummate the Acquisition and (c) the
determination of whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement, in each case shall be governed by, and construed in accordance with, the laws of the State of Delaware as applied to the
Acquisition Agreement, without regard to the principles of conflicts of law that would cause the application of law of any jurisdiction other than those of the State of Delaware. |
The Purchaser or its affiliates may, in consultation with you, place customary advertisements in financial and other newspapers and periodicals
or on a home page or similar place for dissemination of customary information on the Internet or worldwide web as it may choose, and circulate similar promotional materials, in each case, after the Closing Date, in the form of tombstone
or otherwise describing the name of the Issuer and the amount, type and closing date of the Transactions, all at the expense of the Purchaser or affiliate.
Each of the parties hereto agrees that this Commitment Letter is a binding and enforceable agreement (except as may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer, moratorium or similar laws relating to or affecting the rights of creditors generally) with respect to the subject matter contained herein, including an agreement to negotiate in good
faith the Preferred Equity Documentation by the parties hereto in a manner consistent with this Commitment Letter, it being acknowledged and agreed that the commitment provided hereunder is subject solely to conditions precedent as expressly
provided herein.
EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM
BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER OR PROVIDING OF COMMITMENT, AS THE CASE MAY BE, HEREUNDER.
9
Each of the parties hereto hereby irrevocably and unconditionally (a) submits, for
itself and its property, to the exclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York County in the State of New York, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Commitment Letter or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and agrees that all claims in respect of any such action or proceeding shall be
heard and determined in such New York State court or, to the extent permitted by law, in such Federal court, (b) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying
of venue of any suit, action or proceeding arising out of or relating to this Commitment Letter or the transactions contemplated hereby or thereby in any New York State or in any such Federal court, (c) waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and (d) agrees that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law. Each of the parties hereto agrees that service of process, summons, notice or document by registered mail addressed to you or us at the addresses set forth above shall be
effective service of process for any suit, action or proceeding brought in any such court.
We hereby notify you that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56) (signed into law October 26, 2001) (the PATRIOT Act) and the requirements of 31 C.F.R. § 1010.230 (the
Beneficial Ownership Regulation), the Purchaser may be required to obtain, verify and record information that identifies the Issuer and its subsidiaries, which information may include their names, addresses, tax identification
numbers and other information that will allow the Purchaser to identify the Issuer and its subsidiaries in accordance with the PATRIOT Act or the Beneficial Ownership Regulation, as applicable. This notice is given in accordance with the
requirements of the PATRIOT Act or the Beneficial Ownership Regulation, as applicable, and is effective for the Purchaser.
The survival,
indemnification, compensation (if applicable), reimbursement (if applicable), jurisdiction, governing law, venue, waiver of jury trial and confidentiality provisions contained herein shall remain in full force and effect regardless of whether the
Preferred Financing shall have been issued and notwithstanding the termination or expiration of this Commitment Letter or the Purchasers Commitment hereunder; provided that your obligations under this Commitment Letter shall automatically
terminate and be superseded by the provisions of the definitive documentation relating to the Preferred Equity (to the extent covered therein) upon the initial funding thereunder, and you shall automatically be released from all liability in
connection therewith at such time. You may terminate this Commitment Letter and/or the Purchasers Commitment with respect to the Preferred Financing (or any portion thereof) hereunder at any time subject to the provisions of the preceding
sentence.
Section headings used herein are for convenience of reference only and are not to affect the construction of, or to be taken
into consideration in interpreting, this Commitment Letter.
10
9. |
The Purchaser represents that (i) it is an accredited investor within the meaning of
Regulation D, Rule 501(a), promulgated by the SEC under the Securities Act, as presently in effect and (ii) it is able to fend for itself, can bear the economic risk of its investment in the Preferred Financing, and has such knowledge and
experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Preferred Financing. |
10. |
Effectiveness; Expiration. If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms of this Commitment Letter by returning to the Purchaser (or its legal counsel on behalf of the Purchaser), executed counterparts hereof not later than 11:59 p.m., New York City time, on July 29, 2024. The
Purchasers Commitment and obligations hereunder will expire at such time in the event that the Purchaser (or its legal counsel) have not received such executed counterparts in accordance with the immediately preceding sentence. If you do so
execute and deliver to us this Commitment Letter at or prior to such time, we agree to hold our commitment to provide the Preferred Financing and our other undertakings in connection therewith available for you until the earliest of (i) after
execution and delivery of the Acquisition Agreement and prior to the consummation of the Transactions, the termination of the Acquisition Agreement by you (or your affiliate) or with your (or your affiliates) written consent in accordance with
its terms (other than with respect to provisions therein that expressly survive termination), (ii) the consummation of the Acquisition without the issuance by the Issuer of the Preferred Financing and (iii) 11:59 p.m., New York City time on the date
that is five business days after the Outside Date (as defined in and as may be extended pursuant to the Acquisition Agreement as in effect as of the date hereof (such earliest time, the Expiration Date). Upon the occurrence of any
of the events referred to in the preceding sentence, this Commitment Letter and the commitment of the Purchaser hereunder shall automatically terminate unless the Purchaser shall, in its sole discretion, agree to an extension in writing. The
termination of any Commitment pursuant to this paragraph will not prejudice your rights and remedies in respect of any breach or repudiation of this Commitment Letter. |
11
|
|
|
Sincerely, |
|
MERITAGE FUND SELECT I LLC |
|
|
By: |
|
/s/ Travis Jordan |
Name: |
|
Travis Jordan |
Title: |
|
Chief Financial Officer |
[Signature Page to
Preferred Equity Commitment Letter]
|
|
|
Agreed and accepted as of the date first written above: |
|
WILDCAT EGH HOLDCO, L.P. |
|
By: SLP WILDCAT AGGREGATOR GP, L.L.C., its general partner |
|
By: SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its managing member |
By: SLTA VII (GP), L.L.C., its general partner |
By: SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Chip Schroeder |
Name: |
|
Chip Schroeder |
Title: |
|
Managing Director |
[Signature Page to
Preferred Equity Commitment Letter]
Exhibit A
Project Wildcat
Transaction Description
Capitalized terms used but not defined in this Exhibit A shall have the meanings set forth in the other Exhibits to the Commitment
Letter to which this Exhibit A is attached (the Commitment Letter) or in the debt commitment letter dated as of the date hereof (the Debt Commitment Letter). In the case of any such capitalized term that
is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit A shall be determined by reference to the context in which it is used.
Wildcat EGH Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (Buyer or Holdco
Parent) and Wildcat OpCo Holdco, L.P., a limited partnership organized under the laws of the State of Delaware (OpCo Parent), were formed at the direction of Silver Lake Partners and its affiliates (collectively, with
the funds partnerships, co-investment entities and other investment vehicles managed, advised or controlled thereby or by one or more directors thereof or under common control therewith, Silver
Lake or Sponsor). Pursuant to an Agreement and Plan of Merger, dated as of the date hereof (together with all exhibits, schedules and other disclosure letters thereto, collectively, as amended, the Acquisition
Agreement), by and among Holdco Parent, OpCo Parent, Wildcat PubCo Merger Sub, Inc., a corporation organized under the laws of the State of Delaware and wholly-owned subsidiary of Holdco Parent (Company Merger Sub),
Wildcat OpCo Merger Sub, L.L.C., a limited liability company organized under the laws of the State of Delaware and wholly-owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Company Merger Sub, the Merger
Subs and each, a Merger Sub and the Merger Subs, together with Holdco Parent and OpCo Parent, the Buyer Entities), a company previously identified to us and code-named Wildcat (the
Company or the Target), and a subsidiary of the Company (the OpCo and, together with the Company, the Company Entities and each, a Company Entity), (i)
Company Merger Sub will merge with and into the Target (the Company Merger), with the Target being the surviving entity of the Company Merger and (ii) OpCo Merger Sub will merge with and into the OpCo (the OpCo
Merger and, together with the Company Merger, the Mergers), with the OpCo being the surviving entity of the OpCo Merger, whereby (A) Holdco Parent will acquire, directly or indirectly, the equity interests of the
Company from the equity holders thereof (collectively, the Company Sellers) and, indirectly, the equity interests of OpCo owned by the Company and (B) OpCo Parent will acquire certain equity interests of the OpCo from the
equity holders thereof (collectively, the OpCo Sellers and, together with the Company Sellers, the Sellers). Other than certain Sellers who may be given the opportunity to retain, rollover or reinvest capital
stock, restricted stock units, profits interests and/or options into OpCo and/or the Company (including certain members of the management of the Company and its subsidiaries) (the Rollover Investors), the Sellers will receive cash
(the Acquisition Consideration) in exchange for their capital stock, restricted stock units, profits interests and/or options in the Company Entities. Immediately after giving effect to the Mergers and the other Transactions, the
Company will be a wholly-owned direct subsidiary of Holdco Parent and OpCo will be owned, collectively, directly or indirectly, by the Rollover Investors, Holdco Parent and OpCo Parent.
A-1
In connection with the foregoing, it is intended that:
|
a) |
The Issuer will issue newly issued shares of a class of preferred equity with an initial stated value of $1,000
per share (such shares the Preferred Equity) and in an aggregate initial stated value of up to $750 million (the Preferred Equity Issuance). |
|
b) |
The Sponsor and certain other investors (including certain Rollover Investors) arranged by and/or designated by
the Sponsor (collectively with the Sponsor, the Investors) will directly or indirectly make (X) cash equity contributions to the Buyer Entities (the foregoing cash equity contributions to the Buyer Entities, the
Common Equity Contribution and, together with the Preferred Equity Issuance, collectively the Equity Contribution), in an aggregate amount equal to, when combined with the fair market value of any capital stock
or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions (as defined below) and the proceeds of the Preferred Equity Issuance, at least 35.0% of the sum of (1) the aggregate gross
proceeds of the Facilities borrowed on the Closing Date, excluding the aggregate gross proceeds of (A) any Loans (as defined in the Debt Commitment Letter) to fund original issue discount and/or upfront fees in connection with the exercise of
the Market Flex Provisions under the Fee Letter (as defined in the Debt Commitment Letter) and (B) any Revolving Loans (as defined in the Debt Commitment Letter) to fund any working capital needs on the Closing Date and (2) the
equity capitalization of the Borrower and its subsidiaries on the Closing Date after giving effect to all of the Transactions (such sum of clauses (1) and (2), the Total Capitalization) and (Y) the Common Equity
Contribution, in an aggregate amount equal to, when combined with the fair market value of any capital stock or other equity interests of any of the Rollover Investors rolled over or invested in connection with the Transactions, at least 30.0% of
the Total Capitalization (the Minimum Common Equity Contribution); provided that, if applicable, to the extent any stockholder or other equity holder of the Target has exercised appraisal rights in connection with the
Transactions, then on the Closing Date the Investors may elect to issue one or more equity commitment letters and/or arrange for one or more letters of credit to be issued on their behalf in an aggregate amount not less than the amount of
consideration that would otherwise be paid under the Acquisition Agreement in respect of the shares or other equity interests subject to such appraisal rights (the Appraisal Shares) and, for purposes of this Commitment Letter, an
aggregate amount of such equity commitment letters and/or letters of credit up to, but not in excess of, the amount of consideration that would otherwise be paid under the Acquisition Agreement in respect of the Appraisal Shares shall be included in
the amount and percentage of the Equity Contribution from and after the Closing Date as if such amount was funded in cash (with it being understood that, on or prior to the date of the final resolution of all such appraisal rights, the lesser of
(a) the amount necessary to satisfy such appraisal rights in full and (b) an amount equal to the full amount committed under such equity commitment letters and/or the face value of any such letters of credit shall be funded, directly or
indirectly, in cash to a newly formed limited liability company organized under the laws of the United States or any state thereof and an indirect subsidiary of the Target that is the borrower under the Revolving Facility and the Initial Term
Facilities (the Borrower) in the form of common equity or preferred equity that ranks junior or pari passu to the Preferred Equity such that the aggregate initial stated value of Preferred Equity issued shall not exceed
$750 million); provided, further that, the Sponsor will control a majority of the voting equity of the Issuer as of the Closing Date. |
A-2
|
c) |
The Borrower will obtain (i) up to $4,250 million under a senior secured term loan A- facility (the Initial Term A Facility) described in the Debt Commitment Letter, (ii) up to $2,750 million under a senior secured term loan B facility described in the Debt Commitment
Letter (the Initial Term B Facility), (iii) up to $250 million under a senior secured revolving credit facility described in the Debt Commitment Letter (the Revolving Facility) and (iv) a senior
secured 364-day term loan facility described in the Debt Commitment Letter (the Margin Bridge Facility and, collectively with the Initial Term A Facility and the Initial Term B Facility, the
Initial Term Facilities; the Initial Term Facilities and the Revolving Facility, collectively, the Credit Facilities) in an aggregate principal amount of up to (A) $1,500 million minus (B) the
aggregate principal amount of any loans funded under the Margin Bridge Facility on the Closing Date. |
|
d) |
The Margin Loan Borrower (as defined in the definitive documentation for the Margin Loan Facility) will seek to
obtain up to $1,500 million under a margin loan facility described in the Debt Commitment Letter (the Margin Loan Facility and, together with the Credit Facilities, the Facilities). |
|
e) |
All principal, accrued, but unpaid interest, fees and other amounts (other than contingent obligations not then
due and payable) outstanding on the Closing Date under the First Lien Credit Agreement, dated as of May 6, 2014 (as amended and restated by Amendment No. 5, dated as of May 18, 2018, and as further amended, supplemented or otherwise
modified from time to time, the Existing Wildcat Credit Agreement and, together with the Existing Tiger Credit Agreement, the Existing Credit Agreements), by and among the WME IMG Holdings, LLC, William Morris Endeavor
Entertainment, LLC, as borrower, IMG Worldwide Holdings, LLC, as co-borrower, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other parties thereto,
shall be repaid in full in connection with, and substantially concurrently with the closing of, the Transactions, and all commitments to lend and guarantees and security in connection therewith shall have been terminated and/or released or customary
arrangements for such termination and/or release have been agreed upon with the administrative agent (the Refinancing). |
|
f) |
The proceeds of the Equity Contribution (including the Preferred Equity Issuance), the Facilities and/or a
portion of the cash on hand at the Target and its subsidiaries on the Closing Date will be applied to pay (i) the Acquisition Consideration, (ii) the Refinancing and (iii) the fees and expenses incurred in connection with the
Transactions (such fees and expenses, the Transaction Costs, and the amounts set forth in clauses (i) through (iii) above, collectively, the Acquisition Funds). |
The transactions described above (including the payment of Transaction Costs) are collectively referred to herein as the
Transactions.
A-3
Exhibit B
Project Wildcat
Preferred Equity
Summary
of Principal Terms and Conditions
|
|
|
Issuer: |
|
Endeavor Group Holdings, Inc. (the Issuer) |
|
|
Purchaser of the Preferred Equity: |
|
Meritage Fund Select I LLC |
|
|
Preferred Equity to be Purchased: |
|
Up to an aggregate amount of 25,000 shares of a single class of Series A Preferred Stock of the Issuer (the
Preferred Equity), with the Stated Value (as defined below) of $1,000 per share and an initial aggregate Stated Value of up to $25 million.
The Purchased Shares shall form and be part of a single series of Preferred Equity of up
to an aggregate of 750,000 shares of Preferred Equity to be issued on the Issue Date pursuant to an existing commitment letter entered into by the Issuer and two purchasers thereof (the Existing
Purchasers). |
|
|
OpCo Preferred Equity: |
|
On the Issue Date (as defined below), Endeavor Operating Company LLC (EOC) shall issue to Endeavor Manager, LLC (Manager) or reclassify existing common units of EOC held by Manager
into, in each case, a single class of preferred equity units of EOC (the Mirror Units), with the foregoing resulting in Mirror Units in the same number, amount of initial stated value and which shall otherwise have economic
terms consistent with that of the Preferred Equity. Any proceeds attributable to the Mirror Units received by the Manager shall be applied on a dollar for dollar basis to redeem the Preferred Equity and the Mirror Units may not at any time be
transferred by the Manager. |
|
|
Ranking: |
|
The Preferred Equity, with respect to dividend rights and rights upon the Issuers liquidation, winding up or dissolution, will rank senior to all other equity interests of the Issuer. |
|
|
Issue Date: |
|
If the Closing of the portion of the Preferred Financing for which the Purchaser has provided a Commitment occurs, the Preferred Equity to be purchased by the Purchaser will be issued on the closing date of the Acquisition (such
date of issuance, the Issue Date), conditioned upon the occurrence of the Ratings Event and the satisfaction or waiver by Purchaser of the conditions set forth in Exhibit
C. |
B-1
|
|
|
Dividends: |
|
Dividends will accrue and accumulate on a daily basis in arrears from the Issue Date at an annual rate equal to the Preferred Dividend Rate
(as defined below) on the Stated Value of the Preferred Equity outstanding from time to time, whether or not declared and paid, and if not declared and paid, will accrue and be compounded semi-annually in arrears (such compounded dividends, the
Compounded Dividends) on dividend payment dates to be mutually agreed upon by the Issuer and the Purchaser (each such date, a Dividend Payment Date). Unless otherwise elected by the Issuer,
dividends on the Preferred Equity will not be paid in cash and instead will continue to accrue and be compounded in arrears on each Dividend Payment Date. Dividends (other than Compounded Dividends, which will be redeemable solely in accordance with
Optional Redemptions and Mandatory Redemptions below) will be payable, at the election of the Issuer, in cash at any time, when, as and if declared by the board of directors of the Issuer or any authorized committee thereof.
For the avoidance of doubt, declared dividends can only be paid in cash.
Preferred Dividend Rate means 14.00% per annum from the Issue Date to the 8th
anniversary of the Issue Date, increasing by 100 basis points per annum beginning on the 8th anniversary of the Issue Date and an additional 100 basis points on each anniversary of the Issue Date
thereafter; provided that the Preferred Dividend Rate shall not at any time exceed 18.0% per annum (other than as a result of and upon the occurrence of an Event of Default).
Stated Value means, at any date of determination and with
respect to each outstanding share of Preferred Equity, the sum of (i) $1,000 (adjusted as appropriate in the event of any stock dividend, stock split, recapitalization or combination with respect to the Preferred Equity), plus (ii) the
aggregate Compounded Dividends with respect to such share as of the date of determination. |
|
|
Maturity: |
|
Perpetual. |
|
|
Optional Redemption: |
|
The Issuer may, at its option on any one or more dates after the Issue Date (any such date, a Redemption Date), redeem the Preferred Equity, in whole or in part, in cash at the Redemption
Price (as defined below). |
B-2
|
|
|
|
|
Redemption Price means, with respect to any share of Preferred Equity at any Redemption Date: |
|
|
|
|
(a) with respect to any Redemption Date occurring prior to the First Call Date, an amount per share equal to (A) the sum of (i) the Stated Value as of such Redemption Date and (ii) the Make-Whole Amount as of such
Redemption Date, with this clause (ii) discounted to the present value as of the Redemption Date using an annual discount rate (applied quarterly) equal to the rate on U.S. Treasury notes with a maturity closest to the First Call Date plus 50
basis points, plus (B) the aggregate accumulated and unpaid dividends (other than the Compounded Dividends) up to, but excluding, the Redemption Date; and |
|
|
|
|
(b) with respect to any Redemption Date occurring on or after the First Call Date, an amount per share equal to the (i) Stated Value, multiplied by the applicable Redemption Percentage, plus (ii) the
aggregate accumulated and unpaid dividends (other than Compounded Dividends), up to, but excluding, the Redemption Date. |
|
|
|
|
Make-Whole Amount means, with respect to any redemption of any share of Preferred Equity prior to the 24-month anniversary of the Issue Date (the
First Call Date), an amount equal to the sum of (I) the remaining dividends that would accrue on such share of Preferred Equity being redeemed from the Redemption Date to the First Call Date, plus (II) the
premium portion of the Redemption Price (i.e., such portion that is above par) that would be payable on the First Call Date in respect of the Preferred Equity being redeemed, assuming that, for purposes of calculating clauses (I) and (II), that
such share of Preferred Equity were to remain outstanding through the First Call Date (including any applicable deemed accumulation and compounding of dividends during such period), and then be redeemed on the First Call Date. |
|
|
|
|
Redemption Percentage means (a) beginning on the First Call Date and until the one-year anniversary of the First Call Date, 102.0% and (b) thereafter,
100%. |
|
|
Mandatory Redemption: |
|
In the event of (i) the occurrence of a Change of Control (as such term shall be defined and to be based on clause (b) of the corresponding definition in the Credit Agreement dated as of August 18, 2016 among Zuffa
Guarantor, LLC, UFC Holdings, LLC, as the borrower, Goldman Sachs Bank USA, as administrative agent, and the other parties thereto, as amended (but with the deletion of clause (b) of the defined term Sponsor), and consistent with
such definition in the credit agreement to be entered into on or around the Issue Date (the New Credit Agreement) but shall require that the Issuer at all |
B-3
|
|
|
|
|
times (a) own, directly or indirectly, 100% of the equity interests of Manager and (b) control the majority of the voting interests
of EOC), (ii) the consummation of an IPO (as defined below), or (iii) any voluntary or involuntary bankruptcy, liquidation, dissolution or winding up of the Issuer or the Borrower, then all outstanding Preferred Equity shall be redeemed for
cash at a price per share equal to the applicable Redemption Price as of such Redemption Date.
An IPO means the consummation of any transaction resulting in the common equity interests of the Issuer, a parent entity or a subsidiary thereof,
or a successor of the Issuer, on the New York Stock Exchange, the NASDAQ Global Market or other internationally recognized stock exchange or similar market including via a consummated bona fide initial underwritten public offering, direct listing or
consummation of a merger or acquisition by a publicly listed special purpose acquisition vehicle. |
|
|
Documentation: |
|
The Preferred Equity issued on the Issue Date will be purchased by the Purchaser pursuant to a purchase agreement to be mutually agreed between the Issuer and the Purchaser (the Purchase
Agreement), including representations and warranties substantially consistent with the New Credit Agreement, with such changes as are appropriate for a preferred equity purchase agreement (which shall include, among others,
representations as to the capitalization of the Issuer, no registration of the Preferred Equity, due authorization, valid issuance of the Preferred Equity, tax status of the Issuer as a corporation and
non-United States real property holding corporation status of the Issuer) and the Preferred Equity will be issued pursuant to a Certificate of Designations (together with the Purchase Agreement, the
Preferred Equity Documentation). |
|
|
Information Rights: |
|
The Certificate of Designations will include such information rights as is consistent with the New Credit Agreement, but with such modifications for a preferred equity security, including that (i) audited annual financial
statements of the Borrower shall be delivered within 120 days (or, in the case of the first fiscal year ending after the Closing Date, 150 days) of the last day of each fiscal year, (ii) unaudited quarterly financial statements of the Borrower
shall be delivered within 60 days (or, in the case of the first three fiscal quarters ending after the Closing Date, 90 days) of the last day of each of the first three fiscal quarters and (iii) prior to an IPO, the Borrower shall deliver an
annual budget within the time period required for |
B-4
|
|
|
|
|
delivery of audited annual financial statements; provided that the financials referred to in clauses (i) and (ii) shall include such information that explains in reasonable detail, the material differences, if any,
between the information relating to the Borrower and its consolidated subsidiaries on the one hand, and the Issuer and its consolidated subsidiaries on a standalone basis, on the other hand; |
|
|
Remedies to Holders: |
|
If an Event of Default (to be defined in a manner consistent with the New Credit Agreement as in effect on the Issue Date, but as applied to
the definitive documentation for the Preferred Equity and with customary modifications for a preferred equity security to be mutually agreed among the Issuer and the Purchaser) occurs, the Preferred Dividend Rate shall increase by 2.00%.
The Certificate of Designations shall include customary remedies in the event of any
breach, including specific performance and all other available remedies under equity and law, and nothing in the foregoing paragraph shall be deemed to limit the ability of a holder of Preferred Equity to exercise such remedies. |
|
|
Voting Rights: |
|
The holders of Preferred Equity will not have any voting or consent rights; provided, however, that so long as any Preferred Equity remains outstanding, unless a greater percentage is then required by law, the Issuer will not,
without the affirmative vote or consent of the Holder Majority (as defined below), (x) amend, restate, supplement, alter, modify, repeal, waive or change the terms, designations, preferences, rights, privileges or powers of, or the restrictions
provided for the benefit of, the Preferred Equity, (y) effect any binding exchanges, conversions or reclassifications of the Preferred Equity or the Mirror Units or (z) amend, restate modify or change the terms of (or otherwise permit the
amendment, restatement modification or change of the terms of) the organizational documents of the Issuer or EOC in a manner that results in a disproportionate and adverse effect on the holders of Preferred Equity in any material respect;
provided, for the avoidance of doubt, that after the Closing any issuance of preferred equity (including any preferred equity ranking pari passu with or senior to the Preferred Equity) made in compliance with the debt incurrence
covenant shall not require any affirmative vote or consent of any holder of the Preferred Equity. |
B-5
|
|
|
|
|
Holder Majority means holders of a majority of the outstanding Preferred Equity, provided, that each of the Existing Purchasers must be included in any such majority (on a separate and not joint basis) so
long as such Existing Purchaser or any transferee thereof (to which the Preferred Equity has been transferred in compliance with the terms of the Preferred Equity Documentation) holds as of the applicable date of determination not less than 50.1% of
the sum of (i) the Stated Value of the Preferred Equity purchased by such Existing Purchaser on the Closing Date less any Preferred Equity that has been redeemed by the Issuer from such Purchaser or transferee, as applicable, and (ii) the
aggregate Compounded Dividends with respect to such Preferred Equity referred to in clause (i) as of the date of determination; provided that (x) with respect to any of the Existing Purchasers, only such Existing Purchaser or any
transferee thereof (but not both) shall be required to constitute a Holder Majority at any given time and (y) there shall be no more than two holders at any given time who must be required to be included in the Holder Majority. |
|
|
Negative Covenants: |
|
The Preferred Equity Documentation will include customary negative covenants applicable to the Issuer and its restricted subsidiaries that
shall be substantially consistent with (but no more restrictive) than those contained in the New Credit Agreement as in effect on the Issue Date, with a 25% cushion for all baskets (but not for ratios) and with the following
exceptions: (a) with
respect to the debt incurrence covenant, incurrence shall be limited to (i) the Total Leverage Ratio test pursuant to which the Issuer and its restricted subsidiaries may incur or issue an unlimited amount of indebtedness and
preferred equity interests so long as pro forma for such incurrence, the Total Leverage Ratio (which shall be defined in a manner consistent with the New Credit Agreement as in effect on the Issue Date, but shall give effect to the Stated Value of
the Preferred Equity (but excluding any Compounded Dividends), and the liquidation preference of any preferred equity interests that are senior to or pari passu with the Preferred Equity or disqualified equity interests of the Issuer and its
restricted subsidiaries, in each case, excluding any compounded dividends accruing at a rate of up to 14% per annum that are paid or payable in-kind) does not exceed 9.00:1.00 (it being understood that the
foregoing shall not apply to indebtedness under a revolver or other working capital facility or any purchase money indebtedness (including financing lease obligations)) and (ii) customary non-dollar and non-ratio based baskets (other than debt for borrowed money) consistent with the New Credit Agreement as in effect on the Issue Date; |
B-6
|
|
|
|
|
(b) the restricted payments covenant shall prohibit (i) any in-kind distributions by the Issuer and its subsidiaries and (ii) the making of any dividend, distribution or redemption that is paid in cash in respect of shares of common equity, as a class, of
the Issuer or any of its subsidiaries pursuant to the builder basket, the unlimited ratio basket or the general restricted payments basket shall be subject to the requirements under the section titled RP Offer Amount; and
(c) limitations to be
mutually agreed between the Issuer and the Purchaser with respect to the Issuer or any of its subsidiaries pursuing any business activity in the gaming industry that would require the holders of the Preferred Equity or of any of their respective
affiliates or employees to comply with licensing requirements or requirements for invasive or burdensome disclosure of private financial or personal information, or that would impose any burdensome regulatory obligation or constraints on the holders
or their respective affiliates or employees. |
|
|
|
|
For the avoidance of doubt, (x) except as set forth above, the restricted payments covenant shall include all baskets, ratios and exceptions as set forth in the New Credit Agreement as in effect on the Issue Date, with a 25%
cushion for all baskets (but not for ratios) and (y) the Issuer shall be permitted to designate subsidiaries as unrestricted subsidiaries subject only to certain requirements which shall be consistent with those set
forth in the New Credit Agreement. |
|
|
RP Offer Amount: |
|
In the event of any proposed dividend, distribution or redemption that is paid in cash with respect to shares of common equity, as a class, of the Issuer or any of its subsidiaries to be made in reliance upon the builder
basket, the unlimited ratio basket or the general restricted payments basket, the contemplated amount of such dividend, distribution or redemption (or, if less, the amount of the Stated Value of the then outstanding Preferred Equity) (the
RP Offer Amount) shall first be offered to the holders of Preferred Equity to redeem at par the then outstanding Preferred Equity at the then current Stated Value thereof on a pro rata basis; provided that
(x) such |
B-7
|
|
|
|
|
holders may elect to receive all or any part of their pro rata amount of such RP Offer Amount and (y) any declined amounts shall be offered to accepting holders (based on their pro rata share of such declined amounts) before
such declined amounts may fund any redemption, distribution, payment or transfer of value to any holder of junior equity interests of the Issuer, the Manager or EOC. |
|
|
Affirmative Covenants: |
|
The Certificate of Designations will contain affirmative covenants with respect to maintenance of existence, compliance with laws and payment of taxes, which shall be substantially consistent with (but no more restrictive) than
those to be contained in the New Credit Agreement as in effect on the Issue Date, with such modifications as are customary for a preferred equity security to be mutually agreed among the Issuer and the Purchaser. |
|
|
Limits on Transferability: |
|
At any time from and after the Issue Date, Preferred Equity may be transferred only with the Issuers prior written consent, subject to
customary exceptions for (i) transfers by Meritage to its affiliates and related funds, excluding in any event any portfolio company of Meritage and its affiliates and related funds and (ii) pledges in connection with bona fide fund level
indebtedness. The Purchaser shall be permitted to transfer its Preferred Equity without notice or consent being required to any person upon any failure to comply with its obligations under Mandatory Redemption above, or any voluntary
bankruptcy, liquidation, dissolution or winding up of the Issuer or the Borrower.
Notwithstanding anything to the contrary herein, from and after the fifth anniversary of the Issue Date, the Preferred Equity may be transferred without notice
or consent being required to a qualified institutional buyer as defined pursuant to Rule 144A promulgated under the Securities Act of 1933, as amended. |
|
|
Governance Rights: |
|
None pursuant to the Purchase Agreement or Certificate of Designations. The foregoing shall not impact or affect any governance rights that the Purchaser may have as set forth in any other documentation. |
|
|
Registration Rights: |
|
None. |
|
|
Preemptive Rights: |
|
None. |
|
|
Applicable Law: |
|
As to the Certificate of Designations: Delaware. |
|
|
|
|
As to the Purchase Agreement: New York. |
B-8
|
|
|
Tax Provisions: |
|
From and after the Closing Date, the Issuer will be treated as a domestic C corporation for U.S. federal income tax purposes and will not
take any action that would cause it not to be a domestic C corporation for U.S. federal income tax purposes or could otherwise cause any holder of the Preferred Equity (each, a Holder and, collectively, the
Holders) to own an interest in an entity that is not a domestic C corporation for U.S. federal income tax purposes, in each case without the consent of each of the Holders, which consent may be withheld in a Holders
sole discretion. The Preferred Equity Documentation will include provisions
reflecting the parties intent that (i) the Preferred Equity is intended to be treated as equity (and not debt) for U.S. federal income tax purposes, (ii) Holders shall not be required to include in income as a dividend for U.S.
federal income tax purposes any amounts in respect of the Preferred Equity unless and until such dividends are declared and paid in cash, and (iii) any redemption of the Preferred Equity from a Holder thereof, whether in part or in full,
qualifies as a sale or exchange of such Preferred Stock pursuant to Section 302 of the Code and not as a distribution for U.S. federal income tax purposes. The Issuer will, and will cause any paying agent or other agent of the Issuer to, report
consistently with, and take no positions or actions inconsistent with (including on any IRS Form 1099 or any other information return or by way of withholding), the intended tax treatment set forth in the preceding clauses (i) through (iii)
(the Intended Tax Treatment) unless otherwise required by a change in law or a final determination of a taxing authority which, in each case, is binding on the Issuer.
The Issuer will represent that it is not, and does not anticipate becoming, a United
States real property holding corporation (USRPHC) within the meaning of Section 897(c)(2) of the Code. The Issuer shall (a) provide to any Holder, within ten (10) days of such Holders written request,
(i) a certification that the Preferred Equity does not constitute a United States real property interest, in accordance with Treasury Regulations Section 1.897-2(h)(1) or
(ii) written notice of its legal inability to provide such a certification and (b) in connection with the provision of any certification pursuant to the preceding clause (a)(i), comply with the notice provisions set forth in Treasury
Regulations Section 1.897-2(h). In the event the Issuer becomes aware of any facts or circumstances that could reasonably be expected to cause it to become a USRPHC, the Issuer shall promptly notify the
Holders. |
B-9
|
|
|
|
|
The Issuer shall provide any information reasonably requested by the Holders to enable the Holders (and their direct or indirect equity
owners) to comply with their U.S. federal income tax reporting and withholding obligations, including, but not limited to, an estimate or determination (and accompanying certification in accordance with Treasury Regulations Section 1.1441-3(c)(2)(ii)(A)) of the amount of the Issuers current and accumulated earnings and profits in any taxable year where such estimate or determination is relevant to determining the amount (if
any) of any distribution or deemed distribution received by the Holders from the Issuer that is properly treated as a dividend for U.S. federal income tax purposes.
The Purchaser will provide (i) an IRS Form W-9 or (ii) IRS form W-8
claiming a complete exemption from U.S. withholding tax on dividends. Subject to compliance with the Intended Tax Treatment, the Issuer (and any other applicable withholding agent) may deduct and withhold any amounts required to be deducted and
withheld under applicable law with respect to the Preferred Equity (and may set off any such amounts required to be withheld against any dividends or other payments on the Preferred Equity). |
|
|
Fees and Expenses: |
|
The Preferred Equity Documentation will contain expense reimbursement and indemnity provisions substantially consistent with the Commitment Letter. |
B-10
Exhibit C
Project Wildcat
Preferred Commitment Letter
Summary of Additional Conditions1
The funding of the Preferred Financing by the Purchaser on the Closing Date is subject solely to the satisfaction or waiver by the Purchaser
of the applicable conditions set forth in the section entitled Conditions in the body of the Commitment Letter and the following conditions (subject in all respects to the Limited Conditionality Provisions):
1. Since the date of the Acquisition Agreement, no Material Adverse Effect (as defined in the Acquisition Agreement as in effect on the
Signing Date) shall have occurred and be continuing that would result in the failure of a condition precedent to your obligation to fund the Acquisition under the Acquisition Agreement or that would give you the right (taking into account any notice
and cure provisions) to terminate your obligations pursuant to the terms of the Acquisition Agreement.
2. The Acquisition shall have been
consummated, or substantially simultaneously with the purchase of the Preferred Financing and the initial borrowings under the Facilities, shall be consummated, in all material respects in accordance with the terms of the Acquisition Agreement,
after giving effect to any modifications, amendments, consents or waivers by Buyer (or any of its affiliates) thereto, other than those modifications, amendments, consents or waivers by Buyer (or its affiliate) that are materially adverse to the
interests of the Purchaser in its capacity as such when taken as a whole (it being understood that any modification, amendment, consent or waiver to the definition of Material Adverse Effect shall be deemed to be materially adverse to the interests
of the Purchaser), unless consented to in writing by the Purchaser (such consent not to be unreasonably withheld, delayed or conditioned); provided that the Purchaser shall be deemed to have consented to such amendment, supplement, waiver or
modification unless they shall object in writing thereto within three business days of being notified or otherwise becoming aware of such amendment, waiver, modification, consent or waiver being delivered; provided, further, that, any
dispositions permitted under the Acquisition Agreement shall not be deemed materially adverse to the interests of the Purchaser in its capacity as such, whether taken individually or in the aggregate; provided, further, that without limiting any
other rights and/or obligations of this Exhibit C, any modification, amendment or express waiver or consents by Buyer (or its affiliate) that results in (a) a reduction in the Acquisition Consideration shall not be deemed to be materially
adverse to the Purchaser if such reduction is applied (i) first to reduce the Equity Contribution to 35.0%, subject to the Minimum Common Equity Contribution of at least 30.0% and (ii) thereafter, (I) 65.0% to reduce the Initial Term A
Facility until the amount of commitments in respect of the Initial Term A Facility is $0, and thereafter to reduce the amount of commitments in respect of the Initial Term B Facility and the Margin Bridge Facility and (II) 35.0% to reduce the Equity
Contribution, subject to the Minimum Common Equity Contribution of at least 30.0% and (b) an increase in the Acquisition Consideration shall be deemed to be materially adverse to the Purchaser. Any reduction in the amount of the Equity
Contribution shall be pro rata among the components of common equity contribution and the Preferred Equity or, at the option of the Purchaser, shall reduce only the common equity contribution.
1 |
All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to
which this Exhibit C is attached, including Exhibits A and B thereto. In the case of any such capitalized term that is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit C shall be determined by reference
to the context in which it is used. |
C-1
3. Confirmation from you that the Common Equity Contribution shall have been made, or
substantially simultaneously with the funding of the Preferred Financing, shall be made, in at least the amount set forth in Exhibit A to the Commitment Letter.
4. (a) Substantially simultaneously with the initial borrowing under the Term Facilities and the consummation of the Acquisition, the
Refinancing shall be consummated and (b) the borrowing of the Facilities shall have been made, or substantially simultaneously with the funding of the Preferred Financing, shall be made, in an aggregate amount not to exceed that which is set
forth with respect to the Facilities on Exhibit B of the Commitment Letter.
5. The Purchaser shall have received (a) audited
consolidated balance sheets of the Target and its consolidated subsidiaries as at the end of, and related consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash
flows of the Target and its consolidated subsidiaries for, the two most recently completed fiscal years ended at least 120 days prior to the Closing Date and (b) unaudited condensed consolidated balance sheets of the Target and its consolidated
subsidiaries as at the end of, and related unaudited condensed consolidated statements of operations, comprehensive income (loss), redeemable interests and shareholders/members equity and cash flows of the Target and its consolidated
subsidiaries for, each subsequent fiscal quarter (other than the last fiscal quarter of the fiscal year) of the Target and its consolidated subsidiaries subsequent to the last fiscal year for which financial statements were prepared pursuant to the
preceding clause (a) and ended at least 60 days before the Closing Date (in the case of this clause (b), without footnotes). The Purchaser hereby acknowledges (x) receipt of the audited financial statements referred to in clause
(a) above for the fiscal years ended December 31, 2021, December 31, 2022 and December 31, 2023, (y) receipt of the unaudited financial statements referred to in clause (b) above for the three months ended March 31,
2024 and (z) that the public filing by the Target with the Securities and Exchange Commission of any required audited financial statements on Form 10-K or required unaudited financial statements on Form 10-Q, in each case, will satisfy the requirements under clause (a) or (b), as applicable, of this paragraph.
6. The Closing Date shall have occurred on or before the Expiration Date.
7. The Purchaser shall have received at least three business days prior to the Closing Date, all documentation and other information about
Holdings, the Borrower and the Issuer that shall have been reasonably requested by the Purchaser in writing at least ten business days prior to the Closing Date and that the Purchaser reasonably determines is required by United States regulatory
authorities under applicable know your customer and anti-money laundering rules and regulations, including without limitation the PATRIOT Act, including, if the Issuer qualifies as a legal entity customer under the Beneficial
Ownership Regulation (as defined below), a Beneficial Ownership Certification (as defined below) in relation to the Issuer. Beneficial Ownership Certification means a certification regarding beneficial ownership required by the
Beneficial Ownership Regulation (as defined below), which certification shall be substantially similar in substance to the form of Certification Regarding Beneficial Owners of Legal Entity Customers included as Appendix A to the Beneficial Ownership
Regulation. Beneficial Ownership Regulation means 31 C.F.R. § 1010.230.
C-2
8. Subject in each case to the Limited Conditionality Provisions, (a) the Specified
Representations shall be accurate in all material respects; provided that, any Specified Representations qualified by materiality shall be, as so qualified, accurate in all respects, and (b) the Specified Acquisition Agreement
Representations shall be accurate in all material respects provided that, any Specified Acquisition Agreement Representations qualified by materiality shall be, as so qualified, accurate in all respects.
9. Subject in all respects to the Limited Conditionality Provisions, (a) the execution and delivery by the Issuer of the Preferred Equity
Documentation (as defined in Exhibit B to the Commitment Letter) which shall be in accordance with the terms of the Commitment Letter and the Term Sheet and (b) delivery to the Purchaser of the following (the Closing
Deliverables): (i) customary legal opinions, customary officers closing certificates, organizational documents, customary evidence of authorization and good standing certificates in jurisdictions of formation/organization, in
each case with respect to the Issuer and (ii) a solvency certificate, dated as of the Closing Date, after giving effect to the Transactions, substantially in the form of Annex II to this Commitment Letter, of a senior financial executive or
officer of the Issuer (or, at the option of the Issuer, a third party opinion as to the solvency of the Issuer and its subsidiaries on a consolidated basis issued by a nationally recognized firm).
10. All fees required to be paid on the Closing Date pursuant to the Commitment Letter and reasonable out-of-pocket expenses required to be paid on the Closing Date pursuant to the Commitment Letter, to the extent invoiced at least three business days prior to the Closing Date (except as otherwise reasonably
agreed by the Issuer), shall, upon the funding of the Preferred Financing, have been, or will be substantially simultaneously, paid (which amounts may be offset against the proceeds of the Preferred Financing).
C-3
Annex I
Closing Payment
The Closing Payment
payable to the Purchaser shall be equal to 2.00% of the amount of the Purchasers Commitment that is funded on the Closing Date.
Annex I-1
Annex II
Solvency Certificate
[ ], 202[ ]
This
Solvency Certificate (this Certificate) is delivered pursuant to Section [ ] of the Purchase Agreement, dated as of [ ] (as amended as of the date hereof, and as it may be further amended, supplemented or
otherwise modified, the Purchase Agreement), by and among [ ] (the Issuer) and [ ], a [ ]. Unless otherwise defined herein, capitalized terms used in this Certificate shall have
the meanings set forth in the Purchase Agreement.
I, [ ], the [ ] of the Issuer, in that capacity only and not in my
individual capacity (and without personal liability), DO HEREBY CERTIFY on behalf of the Issuer that as of the date hereof, and based upon facts and circumstances as they exist as of the date hereof (and disclaiming any responsibility for changes in
such facts and circumstances after the date hereof), that:
1. For purposes of this certificate, the terms below shall have the following
definitions:
(a) Fair Value
The amount at which the assets (both tangible and intangible), in their entirety, of the Issuer and its subsidiaries taken as a whole would
change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any compulsion to act.
(b) Present Fair Salable Value
The amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the Issuer and its
subsidiaries taken as a whole are sold with reasonable promptness in an arms-length transaction under present conditions for the sale of comparable business enterprises insofar as such conditions can be
reasonably evaluated.
(c) Liabilities
The recorded liabilities (including contingent liabilities that would be recorded in accordance with GAAP) of the Issuer and its subsidiaries
taken as a whole, as of the date hereof after giving effect to the consummation of the Transactions, determined in accordance with GAAP consistently applied.
(d) Will be able to pay their Liabilities as they mature
As of the date hereof, the Issuer and its subsidiaries on a consolidated basis taken as a whole will have sufficient assets and cash flow to
pay their Liabilities as those liabilities mature or (in the case of contingent Liabilities) otherwise become payable, in light of business conducted or anticipated to be conducted by the Issuer and its subsidiaries as reflected in the projected
financial statements and in light of the anticipated credit capacity.
Annex II-1
(e) Do not have Unreasonably Small Capital
The Issuer and its subsidiaries on a consolidated basis taken as a whole after consummation of the Transactions is a going concern and has
sufficient capital to reasonably ensure that it will continue to be a going concern immediately following the consummation of the Transactions. I understand that unreasonably small capital depends upon the nature of the particular
business or businesses conducted or to be conducted, and I have reached my conclusion based on the needs and anticipated needs for capital of the business conducted or anticipated to be conducted by the Issuer and its subsidiaries on a consolidated
basis as reflected in the projected financial statements and in light of the anticipated credit capacity.
2. Based on and subject to the
foregoing, I hereby certify on behalf of the Issuer that after giving effect to the consummation of the Transactions, it is my opinion that (i) the Fair Value of the assets of the Issuer and its subsidiaries on a consolidated basis taken as a
whole exceeds their Liabilities, (ii) the Present Fair Salable Value of the assets of the Issuer and its subsidiaries on a consolidated basis taken as a whole exceeds their Liabilities; (iii) the Issuer and its subsidiaries on a
consolidated basis taken as a whole do not have Unreasonably Small Capital; and (iv) the Issuer and its subsidiaries taken as a whole will be able to pay their Liabilities as they mature.
3. In reaching the conclusions set forth in this Certificate, the undersigned has made such investigations and inquiries as the undersigned
has deemed appropriate, having taken into account the nature of the particular business anticipated to be conducted by the Issuer and the Subsidiaries after consummation of the transactions contemplated by the Purchase Agreement.
IN WITNESS WHEREOF, I have executed this Certificate as of the date first written above.
|
|
|
By: |
|
|
|
|
Name: |
|
|
Title: [Chief Financial Officer] |
Annex II-1
Exhibit (B)(6)
LIMITED GUARANTEE
OF
SILVER LAKE PARTNERS VI, L.P. AND
SILVER LAKE PARTNERS VII, L.P
LIMITED GUARANTEE, dated as of April 2, 2024 (this Limited Guarantee), by Silver Lake Partners VI, L.P. (SLP
Fund VI) and Silver Lake Partners VII, L.P. (SLP Fund VII, and each of SLP Fund VI and SLP Fund VII, a Guarantor), in favor of Endeavor Operating Company, LLC, a Delaware limited liability company (the
Guaranteed Party).
1. Limited Guarantee. To induce the Guaranteed Party to enter into the Agreement and Plan of
Merger, dated as of the date hereof (as amended, supplemented or otherwise modified from time to time in accordance with its terms, the Merger Agreement), by and among Wildcat EGH Holdco, L.P., a Delaware limited partnership
(Holdco Parent), Wildcat OpCo Holdco, L.P., a Delaware limited partnership (OpCo Parent and, together with Holdco Parent, the Parent Entities and each, a Parent Entity),
Wildcat PubCo Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Holdco Parent (Company Merger Sub), Wildcat Manager Merger Sub, L.L.C., a Delaware limited liability company and wholly-owned subsidiary of
Company Merger Sub (Manager Merger Sub), Wildcat OpCo Merger Sub, L.L.C., a Delaware limited liability company and wholly-owned subsidiary of OpCo Parent (OpCo Merger Sub and, together with Company Merger Sub
and Manager Merger Sub, the Merger Subs and each, a Merger Sub), Endeavor Group Holdings, Inc., a Delaware corporation (the Company), Endeavor Manager, LLC, a Delaware limited liability
company and subsidiary of the Company (the Manager), and the Guaranteed Party (together with the Company and the Manager, the Company Entities and each, a Company Entity), each Guarantor
hereby absolutely, unconditionally and irrevocably guarantees to the Guaranteed Party, on the terms and conditions set forth herein, the due and punctual observance, performance and discharge of all of the payment obligations of the Parent Entities
with respect to all of (a) the Parent Termination Fee, (b) any amounts payable by the Parent Entities pursuant to Section 7.12(c) of the Merger Agreement and (c) the Additional Obligations, in each case, subject to the
limitations set forth in the Merger Agreement, including, without limitation, Section 9.03 thereof (clauses (a), (b) and (c) collectively, the Obligations); provided that, notwithstanding anything that may be
deemed to the contrary contained in this Limited Guarantee, (a) the obligations of each Guarantor under this Limited Guarantee shall be several and not joint and shall be apportioned to each Guarantor in accordance with the respective
proportion set forth opposite such Guarantors name on Schedule A hereto (such proportion for such Guarantor being its Respective Proportion), (b) in no event shall the maximum aggregate liability of the Guarantors
under this Limited Guarantee exceed $725,000,000 (such sum, the Cap) and (c) in no event shall any Guarantor be liable under this Limited Guarantee for amounts in excess of such Guarantors Respective Proportion of the
Cap. The parties agree that this Limited Guarantee may not be enforced without giving effect to the Cap or the other limitations set forth in the foregoing proviso and that the Guaranteed Party will not seek to enforce this Limited Guarantee for an
amount in excess of the Cap. Further, the Guaranteed Party hereby agrees that, to the extent the Parent Entities are relieved of all or any portion of the Obligations by the satisfaction thereof pursuant to any written agreement with the Guaranteed
Party (any amount so relieved, the Reduction Amount), the Cap shall be reduced by an amount equal to the Reduction Amount. The Guaranteed Party may, in its sole discretion,
bring and prosecute a separate Action or Actions against the Guarantors for the full amount of the Obligations (subject to the Cap), regardless of whether any Action is brought against the Parent Entities and the Merger Subs or whether the Parent
Entities and the Merger Subs are joined in any such Action or Actions. The Guaranteed Party hereby agrees that in no event shall any Guarantor be required to pay any amount to the Guaranteed Party or any other Person under, in respect of, or in
connection with this Limited Guarantee other than as expressly set forth herein. If the Parent Entities fail to pay all or any portion of the Obligations when due under the Merger Agreement, the Guarantors liability to the Guaranteed Party
hereunder in respect of such Obligations shall, at the Guaranteed Partys option, become immediately due and payable, and the Guaranteed Party may at any time and from time to time, at the Guaranteed Partys option, take any and all
actions available hereunder or under applicable Law to enforce its rights and remedies hereunder, including to collect the obligations of the Guarantors hereunder in respect of the Obligations (subject to the Cap and other limitations set forth
herein). All payments hereunder shall be made in lawful money of the United States, in immediately available funds. Each Guarantor acknowledges that the Guaranteed Party entered into the Merger Agreement and the Transactions in reliance upon the
execution of this Limited Guarantee. Each capitalized term used and not defined herein but defined in the Merger Agreement shall have the meaning ascribed to it in the Merger Agreement, except as otherwise provided.
2. Nature of Limited Guarantee. In the event that any payment to the Guaranteed Party in respect of the Obligations is rescinded or
must otherwise be returned for any reason whatsoever (other than circumstances where a Guarantor is not liable to make such payment, including in connection with the valid termination of a Guarantors obligations in accordance with
Section 8 hereof), the Guarantors shall remain liable hereunder with respect to the Obligations (subject to the terms and conditions hereof) as if such payment had not been made. This Limited Guarantee is an absolute,
unconditional and irrevocable guarantee of payment and not of collection. Notwithstanding any other provision of this Limited Guarantee, the Guaranteed Party hereby agrees that the Guarantor may assert, as a defense to any payment or performance by
the Guarantor under this Limited Guarantee, any defense to such payment or performance that the Parent Entities and the Merger Subs may have under the terms of the Merger Agreement, other than defenses arising from bankruptcy or insolvency of the
Parent Entities and the Merger Subs and other defenses expressly waived herein. This Limited Guarantee is a primary and original obligation of the Guarantors and is not merely the creation of a surety relationship, and the Guaranteed Party shall not
be required to proceed against the Parent Entities or Merger Subs first before proceeding against the Guarantors.
3. Changes in the
Obligations; Certain Waivers. Each Guarantor agrees that the Guaranteed Party (acting with the prior approval of the Special Committee) may at any time and from time to time, without notice to or further consent of such Guarantor, extend the
time of payment of the Obligations, and may also enter into any agreement with any of the Parent Entities and the Merger Subs or any other Person interested in the Transactions for the extension, renewal, payment, compromise, discharge or release
thereof, in whole or in part, or for any modification of the terms of the Merger Agreement or of any agreement between the Guaranteed Party and any of the Parent Entities and the Merger Subs or any such other Person without in any way impairing or
affecting such Guarantors obligations under this Limited Guarantee or the validity or
2
enforceability of this Limited Guarantee. Subject to the other terms and conditions set forth herein, each Guarantor agrees that the obligations of such Guarantor hereunder are absolute,
unconditional and irrevocable, and shall not be released or discharged, in whole or in part, or otherwise affected by: (i) any amendment or waiver of, or failure or delay of the Guaranteed Party to enforce any right or remedy under, any of the
Merger Agreement or the Obligations (with or without notice to such Guarantor) or the equity commitment letter to which such Guarantor is a party (the Guarantor Equity Commitment Letter); (ii) the existence of any claim, set-off or other right that such Guarantor may have at any time against the Parent Entities, the Merger Subs, the Guaranteed Party or any other Person (other than as expressly provided in herein); (iii) any
insolvency or bankruptcy (or similar event) of or relating to such Guarantor, the Parent Entities, the Merger Subs, the Guaranteed Party or any other Person; (iv) any default by the Parent Entities or the Merger Subs under the Merger Agreement;
(v) any incapacity, lack of authority or limitation of status or power of the Parent Entities or the Merger Subs; (vi) any change in Law; (vii) the adequacy of any other means the Guaranteed Party may have of obtaining payment of the
Obligations; (viii) any discharge of such Guarantor as a matter of applicable Law (other than a discharge of such Guarantor as a result of payment of the Obligations in accordance with the terms of the Merger Agreement or as a result of
defenses to the payment of the Obligations that would be available to the Parent Entities or the Merger Subs under the Merger Agreement) or (ix) any change in the corporate existence (or equivalent), structure or ownership of the Parent
Entities, the Merger Subs, the Guaranteed Party or any other Person interested in the Transactions. To the fullest extent permitted by applicable Law, each Guarantor hereby expressly waives any and all rights or defenses arising by reason of any
applicable Law which would otherwise require any election of remedies by the Guaranteed Party. Each Guarantor waives promptness, diligence, notice of the acceptance of this Limited Guarantee and of the Obligations, presentment, demand for payment,
notice of non-performance, default, dishonor and protest, notice of the Obligations incurred and all other notices of any kind (except for notices to be provided to the Parent Entities or the Merger Subs and
their counsel in accordance with the Merger Agreement or notices to be provided pursuant to express provisions of this Limited Guarantee or any agreements entered into in connection herewith or therewith), all defenses that may be available by
virtue of any valuation, stay, moratorium applicable Law or other similar applicable Law now or hereafter in effect, any right to require the marshalling of assets of any of the Parent Entities or the Merger Subs or any other Person interested in
the Transactions, and all suretyship defenses generally (other than fraud, bad faith or willful misconduct). Each Guarantor hereby waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or
proof of reliance by the Guaranteed Party upon this Limited Guarantee or acceptance of this Limited Guarantee. Each Guarantor acknowledges that it will receive substantial direct and indirect benefits from the Transactions and that the waivers set
forth in this Limited Guarantee are knowingly made in contemplation of such benefits.
The Guaranteed Party hereby covenants and agrees
that it shall not institute, and shall cause the Company, the Manager and its Subsidiaries not to institute, any Action arising under, or in connection with, the Guarantor Equity Commitment Letter, the Merger Agreement or this Limited Guarantee
(whether at law or in equity, whether sounding in contract, tort, statute or otherwise), against any Guarantor or any other Parent Related Party (as defined below), except for claims that are Non-Prohibited
Claims (as defined in the Guarantor Equity Commitment Letter).
3
Subject to the last sentence of Section 2 hereof, each Guarantor
hereby absolutely, unconditionally and irrevocably agrees not to exercise any rights that it may now have or hereafter acquire against any Parent Related Party or any other Person interested in the Transactions that arise from the existence,
payment, performance, or enforcement of each Guarantors Obligations under or in respect of this Limited Guarantee or any other agreement in connection therewith, including, without limitation, any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to participate in any claim or remedy of the Guaranteed Party or any of the Company Related Parties against any Parent Related Party or such other Person whether or not such claim, remedy or
right arises in equity or under contract, statute or common law, including, without limitation, the right to take or receive from any Parent Related Party or such other Person, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, unless and until the Obligations (subject to the Cap and the other limitations set forth herein) shall have been paid in
full in cash. If any amount shall be paid to a Guarantor in violation of the immediately preceding sentence at any time prior to the payment in full in cash of the Obligations (subject to the Cap and the other limitations set forth herein), such
amount shall be received and held in trust for the benefit of the Guaranteed Party, shall be segregated from other property and funds of the applicable Guarantor and shall forthwith be promptly paid or delivered to the Guaranteed Party in the same
form as so received (with any necessary endorsement or assignment) to be credited and applied to the Obligations (subject to the Cap and the other limitations set forth herein), in accordance with the terms of the Merger Agreement and herewith,
whether matured or unmatured, or to be held as collateral for the Obligations.
Each Guarantor acknowledges and agrees that (i) the
provisions of this Limited Guarantee are an integral and essential part of the Transactions and neither the Parent Entities or the Merger Subs nor the Guaranteed Party would have entered into the Merger Agreement without the benefit of this Limited
Guarantee and (ii) it will receive substantial direct and indirect benefits from the Transactions and that the waivers set forth in this Limited Guarantee are knowingly made in contemplation of such benefits. Nothing in this Limited Guarantee
shall limit in any way the right of the Guaranteed Party or any other Company Related Party to seek (and, if applicable, obtain) any equitable relief under, and subject to the limitations in, the Merger Agreement or the Guarantor Equity Commitment
Letter, as applicable.
4. No Waiver; Cumulative Rights. No failure on the part of the Guaranteed Party to exercise, and no delay
in exercising, any right, remedy or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by the Guaranteed Party of any right, remedy or power hereunder preclude any other or future exercise of any right,
remedy or power hereunder. Each and every right, remedy and power hereby granted to the Guaranteed Party or allowed it by applicable Law or other agreement shall be cumulative and not exclusive of any other, and may be exercised by the Guaranteed
Party at any time or from time to time. The Guaranteed Party shall not be obligated to file any claim relating to any Obligations in the event that any Parent Entity becomes subject to a bankruptcy, reorganization or similar proceedings, and the
failure of the Guaranteed Party to so file any claim shall not affect the Guarantors obligations hereunder.
When pursuing its
rights and remedies hereunder against any Guarantor, the Guaranteed Party shall be under no obligation to pursue such rights and remedies it may have against the Parent Entities or the Merger Subs or any other Person for the Obligations, and any
failure by the Guaranteed Party to pursue such other rights or remedies or to collect any payments from the Parent Entities or the Merger Subs or any such other Person shall not relieve the Guarantor of any liability hereunder.
4
5. Representations and Warranties. Each Guarantor hereby represents and warrants to
the Guaranteed Party that:
(a) such Guarantor is duly organized, validly existing and in good standing under the laws of
its jurisdiction of organization;
(b) such Guarantor has all necessary organizational power and authority to execute and
deliver this Limited Guarantee and to perform its obligations hereunder;
(c) the execution, delivery and performance of
this Limited Guarantee by such Guarantor has been duly and validly authorized by all necessary organizational action, and no other organizational proceedings on the part of such Guarantor are necessary to authorize this Limited Guarantee;
(d) all consents, approvals, authorizations, permits of, filings with and notifications to, any Governmental Authority by such
Guarantor necessary for the due execution, delivery and performance of this Limited Guarantee by such Guarantor have been obtained or made and all conditions thereof have been duly complied with, and no other action by, and no notice to or filing
with, any Governmental Authority by such Guarantor is required in connection with the execution, delivery or performance of this Limited Guarantee;
(e) this Limited Guarantee has been duly and validly executed and delivered by such Guarantor and, assuming due execution and
delivery by the Guaranteed Party, constitutes a legal, valid and binding obligation of such Guarantor enforceable against such Guarantor in accordance with its terms (as set forth herein), subject to the Enforceability Exceptions;
(f) the execution and delivery of this Limited Guarantee by such Guarantor do not, and the performance of this Limited
Guarantee by such Guarantor will not, (i) conflict with or violate the organizational documents of the Guarantor, (ii) conflict with or violate any Law applicable to such Guarantor or by which any of its properties or assets is bound or
affected, or (iii) result in any breach or violation of, or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under, or give to others any right of termination, amendment, acceleration or
cancellation of, any Contract or other instrument or obligation to which such Guarantor is a party or by which such Guarantor or any of its properties or assets is bound or affected, except, with respect to each of the foregoing clauses
(ii) and (iii), for any such conflicts, violations, breaches, defaults or other occurrences which would not reasonably be expected to, individually or in the aggregate, materially affect its ability to enter into or timely perform its
obligations under this Limited Guarantee; and
(g) such Guarantor has, and will continue to have for so long as this
Limited Guarantee is in effect, the financial capacity to pay and perform its obligations under this Limited Guarantee, and all funds necessary for such Guarantor to fulfill the Obligations under this Limited Guarantee shall be available to such
Guarantor for so long as this Limited Guarantee shall remain in effect in accordance with the terms hereof.
5
6. Assignment. The rights and obligations under this Limited Guarantee may not be
assigned or delegated (whether by operation of law, merger, consolidation or otherwise) by any party hereto without the prior written consent of the other party, and any attempted assignment without such prior consent shall be null and void and of
no force or effect. Notwithstanding the foregoing, (i) any Guarantor may assign all or a portion of its rights, interests or the Obligations hereunder to one or more of its Affiliated investment funds or any Person that is, directly or
indirectly, wholly-owned or otherwise controlled by or Affiliated with such Guarantor or such Affiliated investment funds, and (ii) each of SLP Fund VI and SLP Fund VII shall be entitled, in its sole discretion, to assign, delegate or otherwise
transfer all or a portion of its obligation to fund its Respective Proportion of the Obligations to the other Guarantor and, upon any such assignment, delegation or transfer pursuant to this clause (ii), SLP Fund VI and SLP Fund VII, as applicable,
shall be irrevocably relieved of all such assigned, delegated or transferred obligations to fund its Respective Proportion of the Obligations hereunder; provided that (a) in the case of the foregoing clause (i), no such assignment,
delegation or transfer shall relieve such Guarantor of its obligations hereunder and (b) in the case of the foregoing clauses (i) and (ii), such assignment, delegation and/or transfer does not have the effect of preventing, impairing or
delaying the Transactions or the satisfaction of the Obligations (subject to the Cap and the other limitations herein) at the time set forth in Section 1. Following any permitted assignment, delegation or transfer by the
Guarantor of its rights, interests or obligations hereunder pursuant to the second sentence of this Section 6, each applicable assigning Guarantor will provide the Guaranteed Party written notice of such assignment,
delegation or transfer and the amount thereof. Upon any such assignment, delegation or transfer by a Guarantor of its obligations hereunder pursuant to the second sentence of this Section 6, such assignee, delegate or
transferee shall be deemed to have given the representations and warranties set forth in Section 5 of this Limited Guarantee as of the time of such assignment, delegation or transfer. Any assignment or delegation in breach
of Section 5 (in respect of the representations and warranties deemed to be made as of the time of such assignment, delegation or transfer) or in violation of this Section 6 shall be null and void
and of no force and effect. As used herein, the term Affiliated shall have the correlative meaning of Affiliate as defined in the Merger Agreement.
7. Notices. All notices, requests, claims, demands and other communications under this Limited Guarantee shall be in writing and shall
be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by an internationally recognized overnight courier service (with proof of delivery), or by email (with confirmation by return email) to the
respective parties hereto at the following coordinates (or at such other coordinates for a party as shall be specified in a notice given in accordance with this Section 7):
|
(a) |
If to the Guarantors to: |
Silver Lake Partners VI, L.P
c/o
Silver Lake Partners VII, L.P.
c/o Silver Lake
2775 Sand Hill Road
6
Suite 100
Menlo Park, CA 94025
Attention: Karen King
Email:
karen.king@silverlake.com
with a copy to:
Silver Lake
55 Hudson Yards
40th Floor
New York, NY 10001
Attention: Andy Schader
Email: andy.schader@silverlake.com
with a copy (which shall not constitute notice) to:
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York,
NY 10017
Attention: Elizabeth Cooper
Christopher May
Email: ecooper@stblaw.com
cmay@stblaw.com
with a copy to:
Simpson
Thacher & Bartlett LLP
2475 Hanover Street
Palo Alto, California 94304
Attention: Mark Myott
Email: mmyott@stblaw.com
|
(b) |
If to the Guaranteed Party to: |
Endeavor Group Holdings, Inc.
9601 Wilshire Blvd, Third Floor
Beverly Hills, CA 90210
Attention: Jason Lublin
Seth Krauss
Courtney Braun
Robert Hilton
Email: jlublin@endeavorco.com
skrauss@endeavorco.com
cbraun@endeavorco.com
rhilton@endeavorco.com
7
with a copy (which shall not constitute notice) to:
Latham & Watkins LLP
1271 Avenue of the Americas
New
York, NY 10020
Attention: Justin Hamill
Michael Anastasio
Ian Nussbaum
Email: justin.hamill@lw.com
michael.anastasio@lw.com
ian.nussbaum@lw.com
and with a copy (which shall not constitute notice) to:
Cravath, Swaine and Moore LLP
Worldwide Plaza
825 Eighth
Avenue
New York, NY 10019
Attention: Faiza Saeed
Claudia Ricciardi
Email: fsaeed@cravath.com
cricciardi@cravath.com
8. Continuing Guarantee. Unless terminated pursuant to this Section 8, this Limited Guarantee shall remain in
full force and effect and shall be binding on each Guarantor, its successors and permitted assigns until the Obligations (subject to the Cap) under this Limited Guarantee have been indefeasibly paid, observed, performed and satisfied in full, at
which time this Limited Guarantee shall terminate and the Guarantors shall have no further obligations under this Limited Guarantee. This Limited Guarantee shall terminate and the Guarantors shall have no further obligations under this Limited
Guarantee automatically and immediately upon the earliest to occur of (i) the Closing and the deposit of the amounts required to be deposited in respect of the Payment Fund and Compensatory Award Fund at Closing in accordance with the terms of
the Merger Agreement and the payment of all other amounts required to be paid at or prior to the consummation of the Transactions pursuant to the Merger Agreement (only after which the obligations hereunder shall be discharged), (ii) payment in
full of the Obligations (subject to the Cap) or (iii) 60 days following the valid termination of the Merger Agreement in accordance with its terms (provided that, in the event that the Guaranteed Party or any of its successors or assigns (or
any agents acting on their behalf) shall have commenced an Action in accordance with this Limited Guarantee against the Guarantors or, in the event that any Company Entity or any of their respective Affiliates, successors or assigns (or any agents
acting on their behalf) shall have commenced an Action in accordance with the Merger Agreement against the Parent Entities, in each case, alleging that the Guarantors or the Parent Entities (as applicable) are liable for any portion of the
Obligations, then this Limited Guarantee shall not terminate and shall survive solely with respect to such amounts claimed or alleged to be so owing pursuant to this clause (iii) until the earlier of (A) the entry of a final, non-appealable order of a court of competent jurisdiction discharging the Guarantors or the Parent Entities (as applicable) of any such Obligations and (B) the termination of this Limited Guarantee by mutual
written agreement of the Guarantors and the Guaranteed Party (acting with the prior approval of the Special Committee) and, in either case, the payment by the Guarantors or the Parent Entities (as applicable) to the Company Entities of all
8
amounts payable by the Guarantors pursuant to such order or agreement). Notwithstanding the foregoing or anything in this Limited Guarantee that may be deemed to the contrary, in the event that
the Guaranteed Party or any of its Affiliates assert in any Action (a) that the provisions of Section 1 hereof limiting any Guarantors liability to the Cap or the provisions of this
Section 8 or Section 9 hereof are illegal, invalid or unenforceable in whole or in part, or (b) any theory of liability against any Guarantor or any Parent Related Party (which term, for the
avoidance of doubt, does not include the Parent Entities or the Merger Subs) with respect to this Limited Guarantee, the Guarantor Equity Commitment Letter, the Merger Agreement or any of the transactions contemplated hereby or thereby (including in
respect of any oral representations made or alleged to be made in connection therewith) (other than, solely with respect to this clause (b), any claim that is a Non-Prohibited Claim), then (x) the
obligations of the Guarantors under this Limited Guarantee shall terminate and be of no further force or effect, (y) if any Guarantor has previously made any payments under this Limited Guarantee, it shall be entitled to recover such payments
in full and (z) neither the Guarantors nor any Parent Related Party shall have any further liability to the Guaranteed Party or its Affiliates with respect to the Transactions under this Limited Guarantee, the Guarantor Equity Commitment
Letter, the Merger Agreement or any of the transactions contemplated hereby or thereby.
9. No Recourse. The Guaranteed Party
acknowledges the separate corporate (or limited liability company or limited partnership) existence of each of the Parent Entities and the Merger Subs and that, as of the date hereof, each of the Parent Entities and the Merger Subs sole
assets (if any) are a de minimis amount of cash, and that no additional funds are expected to be contributed to the Parent Entities or the Merger Subs unless and until the Closing occurs. Notwithstanding anything that may be expressed or implied in
this Limited Guarantee or any document or instrument delivered in connection herewith (including, without limitation, the Guarantor Equity Commitment Letter and the Merger Agreement) (i) in no event shall the Guaranteed Party or any of its
Affiliates or any of their respective former, current and future directors, officers, employees, direct or indirect holder of any equity, stockholders, controlling persons, Affiliates, attorneys, members, managers, general or limited partners,
assignees, agents and representatives seek any monetary damages of any kind, including consequential, indirect or punitive damages, against the Guarantors in excess of the Cap hereunder, and (ii) notwithstanding the fact that each Guarantor may
be a partnership or limited liability company, by its acceptance of the benefits of this Limited Guarantee, the Guaranteed Party acknowledges and agrees that no Person has any right of recovery against, no recourse shall be had against and no
personal liability shall attach to, the Guarantors, the Parent Entities and the Merger Subs, or any of their or their respective Affiliates respective former, current or future directors, officers, employees, holder of any
equity, stockholders, controlling persons, attorneys, members, managers, general or limited partners, assignees (other than a permitted assignee hereunder), agents, representatives or representatives of any of the foregoing (other than, in each
applicable case, the Parent Entities, the Merger Subs and any Guarantor and their respective successors and permitted assigns, a Parent Related Party and together, the Parent Related Parties), including through
the Parent Entities or the Merger Subs or otherwise, whether by or through attempted piercing of the corporate (or limited liability company or limited partnership) veil, by or through a claim (whether at law or equity or in tort, contract or
otherwise) by or on behalf of any of the Parent Entities and the Merger Subs against any Parent Related Parties, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any applicable Law, or otherwise, except for
its rights to recover from the Guarantors (but not any other Person) under and to the extent provided in this Limited
Guarantee and subject to the other limitations described herein and any other claims that are Non-Prohibited Claims; it being agreed and acknowledged that
no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any Parent Related Party for any obligation of any Guarantor or any of its successors or permitted assigns under this Limited Guarantee or any documents or
instruments delivered in connection herewith or in respect of any oral or written representations made or alleged to have been made in connection herewith or for any claim (whether at law or in equity or in tort, contract or otherwise) based on, in
respect of, or by reason of such obligation or their creation. Except for any claims that are Non-Prohibited Claims, recourse against the Guarantors under this Limited Guarantee, subject to the limitations and
conditions set forth herein, shall be the sole and exclusive remedy of the Guaranteed Party and all of its Affiliates against the Guarantors and any Parent Related Party in respect of any liabilities or obligations arising under, or in connection
with, the Merger Agreement, the failure of the Transactions to be consummated for any reason or otherwise in connection with the transactions contemplated hereby and thereby or in respect of any representations made or alleged to have been made in
connection therewith, whether in equity or at law, in contract, in tort or otherwise. Nothing set forth in this Limited Guarantee shall affect or be construed to affect any liability of the Parent Entities and the Merger Subs to the Guaranteed Party
or shall confer or give or shall be construed to confer or give to any Person other than the Guaranteed Party (including any Person acting in a representative capacity) any rights or remedies against any Person other than the Guarantors as expressly
set forth herein. Notwithstanding anything to the contrary provided herein or any document or instrument delivered in connection herewith, nothing herein (including this Section 9) shall limit the Non-Prohibited Claims. For the avoidance of doubt, (a) nothing in this Limited Guarantee shall prohibit the Company Entities from pursuing both a grant of specific performance or other equitable relief pursuant
to Section 10.08(a) of the Merger Agreement and the payment of the Obligations (subject to the limitations set forth therein) and (b) in no event shall the Company Entities be entitled to both (i) obtain an order for specific
performance or other equitable relief that enforces Parent Entities and Merger Subs obligation to consummate the Transactions and the Equity Investors obligation to provide the Equity Financing, in each case pursuant to
Section 10.08(a) of the Merger Agreement and (ii) receive the payment of the Obligations if payable hereunder pursuant to the terms hereof and the terms of the Merger Agreement (subject to the limitation set forth herein and therein).
10. Governing Law; Jurisdiction; Waiver of Jury Trial.
(a) This Limited Guarantee shall be governed by and construed in accordance with the Laws of the State of Delaware without regard to the
principles of conflicts of law that would cause the application of law of any jurisdiction other than those of the State of Delaware.
(b)
The parties hereto agree that any Action seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Limited Guarantee or the transactions contemplated hereby (whether brought by any party or any of its
Affiliates or against any party or any of its Affiliates) shall be heard and determined exclusively in the Court of Chancery of the State of Delaware; provided, however, that, if such court does not have jurisdiction over such Action,
such Action shall be heard and determined exclusively in any federal or state court located in the State of Delaware. Consistent with the preceding sentence, each of the parties hereto hereby (i) submits to the exclusive jurisdiction of any
federal or state court sitting in the State of Delaware for the purpose of any Action arising out of or relating to
10
this Limited Guarantee brought by either party hereto, (ii) agrees that service of process will be validly effected by sending notice in accordance with Section 10.02 of the Merger
Agreement and (iii) irrevocably waives, and agrees not to assert by way of motion, defense, or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt
or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Limited Guarantee or the transactions contemplated hereby may not be enforced in or by any of the
above named courts.
(c) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LIMITED GUARANTEE OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES HERETO
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS LIMITED GUARANTEE AND THE TRANSACTIONS CONTEMPLATED BY THIS LIMITED GUARANTEE, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
10(c).
11. Entire Agreement; Amendments. This Limited Guarantee, including Schedule A attached hereto, the Guarantor
Equity Commitment Letter and the Merger Agreement constitute the entire agreement among the parties with respect to the subject matter hereof and thereof and supersedes all prior agreements and undertakings, both written and oral, among the parties
hereto, or any of them, with respect to the subject matter hereof and thereof. This Limited Guarantee may not be amended, and no provision hereof waived or modified, except by an instrument duly executed by each of the parties hereto (in the case of
the Guaranteed Party, acting with the prior consent of the Special Committee), and this Limited Guarantee may not be terminated other than in accordance with Section 8 hereof.
12. Headings. The descriptive headings herein are inserted for convenience of reference only and are not intended to be part of or to
affect the meaning or interpretation of this Limited Guarantee. When a reference is made in this Limited Guarantee to a Section, such reference shall be to a Section of this Limited Guarantee unless otherwise indicated.
13. Counterparts. This Limited Guarantee may be executed and delivered (including by facsimile transmission or other means of
electronic transmission, such as by electronic mail in pdf form) in counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together
shall constitute one and the same Limited Guarantee.
[Remainder of this page intentionally left blank.]
11
IN WITNESS WHEREOF, the Guarantors have caused this Limited Guarantee to be executed and
delivered as of the date first written above by its officer thereunto duly authorized.
|
|
|
GUARANTORS: |
|
SILVER LAKE PARTNERS VII, L.P. |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VII, L.P., its general partner |
|
|
By: |
|
SLTA VII (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
Name: |
|
Egon Durban |
Title: |
|
Co-CEO |
|
|
|
|
SILVER LAKE PARTNERS VI, L.P. |
|
|
By: |
|
SILVER LAKE TECHNOLOGY ASSOCIATES VI, L.P., its general partner |
|
|
By: |
|
SLTA VI (GP), L.L.C., its general partner |
|
|
By: |
|
SILVER LAKE GROUP, L.L.C., its managing member |
|
|
By: |
|
/s/ Egon Durban |
|
|
|
Name: |
|
Egon Durban |
Title: |
|
Co-CEO |
[Signature Page to
Limited Guarantee]
IN WITNESS WHEREOF, the Guaranteed Party has caused this Limited Guarantee to be executed
and delivered as of the date first written above by its officer thereunto duly authorized.
|
|
|
GUARANTEED PARTY: |
|
ENDEAVOR OPERATING COMPANY, LLC |
|
|
By: |
|
/s/ Jason Lublin |
Name: |
|
Jason Lublin |
Title: |
|
Chief Financial Officer |
[Signature Page to
Limited Guarantee]
Schedule A
Proportions
|
|
|
|
|
Equity Investor |
|
Respective Proportion |
|
Silver Lake Partners VI, L.P. |
|
|
16.26169 |
% |
Silver Lake Partners VII, L.P. |
|
|
83.73831 |
% |
|
|
|
|
|
Aggregate Proportion |
|
|
100.00 |
% |
|
|
|
|
|
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s1g1.jpg)
Confidential Discussion Materials
Project Everest March 8, 2024 Exhibit (C)(2)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior
written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the Board of Directors of Everest (in its capacity as such) in its
consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person. Centerview will not be responsible for and has not provided any tax,
accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or
opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s3g1.jpg)
Situation Update With the authorization
of the Special Committee, Centerview has engaged with Everest management to diligence Everest’s financial forecast and business outlook In addition to a data room, the Everest team has provided a management plan and multiple calls have been
held to provide commercial context Centerview has also worked with CSM to further our collective understanding of Everest’s governance and ownership structure and their implications on a potential transaction Today’s discussion provides
a summary of key learnings and contextualizes the Everest plan based on historical performance and consensus estimates Key outstanding items remain, and further conversations with Everest management are to be conducted as Centerview continues its
diligence and financial analysis Additional updates to be shared with the Special Committee as diligence progresses
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s4g1.jpg)
Significant Progress On Diligence To
Date Centerview has engaged substantially with Everest management since the diligence commenced Provided access to Everest and Kilimanjaro Board and Executive Committee presentations Fall strategic review materials by business unit under each
segment Financial model through 2028 built by business unit Preliminary TRA detail provided by management Dataroom Diligence Calls Capitalization / Tax Management presentation with CFO, Corp Dev team and Counsel Reviewed strategic outlook and
historical performance by business unit Reviewed revenue models Diligence session on Everest Management Plan Q&A driven discussion on key trends and financial outlook by business unit and segment Discussed plan creation process Reviewed
capitalization structure and ownership dynamics Focus on implications of modified Up-C structure Close collaboration with CSM to understand implications of capitalization structure for public shareholders Preliminary discussions with CSM on
implications of Tax Receivable Agreement (“TRA”)
![Slide 5 Slide 5](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s5g1.jpg)
Key Observations From Diligence To Date
Source:Everest filings and Everest Management Plan as of February 21, 2024 per Everest Management (the “Everest Management Plan”). Everest financial historical information pro forma by excluding the effects of IMG academy and including
the full year impact of WWE, per Everest management. Recent Financial Performance 2024 Outlook Draft Everest Management Plan Everest delivered profitable growth in 2023 – +7.8% pro forma revenue growth and 21.6% pro forma Adj. EBITDA margin Up
from +3.8% reported revenue growth in 2022, driven by OSP and EE&R segments Momentum across most segments, despite impact of WGA and SAG-AFTRA strikes Everest 2024 outlook in the Everest Management Plan has been modestly lowered vs. initial
budget for previous Everest management plan Largely driven by Q4 Raw U.S. deal removal, with Netflix deal beginning in Q1 2025 Expecting +20.7% revenue growth and 21.1% Adj. EBITDA margin Revenue and topline growth buoyed by 2024 Olympics (>$1bn
revenue contribution) Management expects +11.1% revenue CAGR from 2023A-2028E +5pp Adj. EBITDA expansion assumed – from 21.6% in 2023A to 27.0% in 2028 Certain scaled contracts and material events drive some measure of variability in financial
results year-over-year Latest Everest Management Plan modestly lower vs. previous Everest management plan, accounting for impact of the Raw U.S. deal removal throughout the projection period, updated IMG Arena outlook based on renewal cycle, and
re-forecasted 2028 Olympics impact
![Slide 6 Slide 6](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s6g1.jpg)
Current Status Next Steps Pro forma
historical financials (e.g., Kilimanjaro formation, divestiture of IMG Academy) Critical tax assumptions Historical tax rates (corporate tax rates, one-time non-TRA impacting items and impact of TRA) Expected impact of TRA and/or other anticipated
one-time items on future tax expense View on normalization of underlying business: Quantifiable impacts of one-time occurrences in Everest Management Plan (e.g., Olympics, OSP deals in 2026) Further understanding of certain cash flow dynamics NWC
and Capex trends for the Olympics Capex trends for WME, IMG Media, IMG Arena, OpenBet Additional detail on cash flow items D&A (particularly perspectives on amortization from M&A and any tax-shielding implications) Detail on “Other
Cash Flow Items” Key Open Questions Continued diligence efforts under way Additional information / call requests: Special Committee updates as diligence and financial analyses progress
![Slide 7 Slide 7](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s7g1.jpg)
Evolution Of Everest Since IPO
Source:Public company filings, Everest presentations, Everest Management Plan and FactSet as of March 7, 2024. Note: Dollars in billion. Financials as publicly reported unless otherwise noted. (1) Pro forma for UFC transaction and IMG Academy
divestiture based on available information. (2) Revenue business mix excludes eliminations. EBITDA contributions exclude corporate cost allocations. Segment results presented as reported. 2022A results pro forma for Sports Data & Technology
re-segmentation. Revenue At IPO Pre-Kilimanjaro Ann. Today Business Units % Growth (LTM) Business Mix(2) Revenue Adj. EBITDA LTM Net Leverage $bn Owned Sports Properties Events, Experiences & Rights Representation Owned Sports Properties Events,
Experiences & Rights Representation Sports Data & Technology ’19-’20: (23.9%) ’18-’19: +26.5% OSP EE&R Rep. Sports Data & Tech 8.8x $5.3 +3.8% Owned Sports Properties Events, Experiences & Rights
Representation FY 2020A FY 2022A 3.8x 3.2x FY 2023A $6.7(1) +7.8% COVID impact As reported $3.5 (1)
![Slide 8 Slide 8](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s8g1.jpg)
F D H G Sep-21 – Everest
announces acquisition of OpenBet for $1.2bn Nov-21 – Everest sells controlling stake in content business for $850mm May-22 – Everest reports first quarter earnings Aug-22 – Everest to Sell Diamond Baseball Holdings to Sierra Apr-23
– Everest announces intention to combine UFC and WWE assets Aug-23 – PFL(1) receives a reportedly $100mm minority investment from SRJ (Saudi sovereign wealth fund backed sports investment vehicle) Sep-23 – Kilimanjaro begins
trading as UFC / WWE transaction closes Oct-23 – Everest announces consideration of strategic alternatives & Sierra announces potential take-private Everest Stock Price Performance Since IPO Source:Public company filings and FactSet as of
March 7, 2024. Note: Starting share price reflects first trading day closing share price. S&P500 performance indexed to Everest share price as of April 29, 2021. (1)Professional Fighters League. $25.20 +22% $24.33 (3%) Everest S&P500 Share
Price Performance Since IPO Public Market Events A B C D E F G B E H C Russian invasion of Ukraine (Feb), Fed hikes interest rates 25bps (Mar) A $17.72 share price prior to Sierra press release
![Slide 9 Slide 9](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s9g1.jpg)
$1,220 / $1,275 $5,665 / $5,815 $5,235
/ $5,475 $1,145 / $1,175 $4,800 / $4,850 Revenue $4,890 / $4,950 $5,200 / $5,450 $5,335 / $5,475 $5,235 / $5,475 $5,825 / $5,975 $5,665 / $5,815 $765 / $775 Quarterly Financial Performance Since IPO Revenue vs. Consensus Adj. EBITDA vs. Consensus
Guidance (Low / High) +$2 % Beat / Miss: % Beat / Miss: FY’21 FY’22 FY’23 EBITDA Source:Public company filings and FactSet as of March 7, 2024. Increased Guidance Guidance Suspended ($32) +$76 +$143 +$142 +$98 ($13) ($10) +$31 +$27
+$80 +$2 +$43 +$43 +$98 +$33 +$74 +$63 +$5 +$2 +$6 +$7 +$25 ($22) $835 / $845 $1,070 / $1,120 $1,100 / $1,150 $1,130 / $1,170 $1,250 / $1,305 $1,220 / $1,275 Everest has consistently beat street expectations
![Slide 10 Slide 10](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s10g1.jpg)
Selected Sell-Side Analyst
Perspectives On Everest Source: Wall Street research as of March 7, 2024. “Everest’s decision to formally evaluate strategic options … provides a catalyst for shares to move even closer to the underlying asset value”
Potential Strategic Alternatives (Nov-2023) “[Underperformance following PFL and other news] … headwinds as transitory [and] the longer term trends in EE&R, Rep. and Sports Betting should remain largely intact” Category
Tailwinds (Oct-2023) “The end of the actor's strike is a positive development for the Representation biz and non-video verticals outperformed in 3Q” Resolution of 2023 Strikes (Nov-2023) “We like the assets of UFC and WWE […]
The upcoming rights expirations for both WWE and UFC present meaningful upside opportunities” UFC and WWE Combination (Sep-2023) “While the company appears committed to lowering leverage ratio to under 4x, adverse developments could pose
a risk to equity investors” Balance Sheet (Feb-2024) “In our view, the stock has been challenged by the complexity of the Everest business model… Plus, the WWE acq. & Kilimanjaro spin further complicate the story”
Organizational Complexity (Oct-2023) “Implementation of a capital returns program [a potential catalyst] as recent and upcoming rights renewals drive significant free cash flow” Capital Return “Everest can capture synergies between
[segments]…. However, it is difficult to quantify whether these synergies represent any material value” Difficulty Quantifying Synergies Across Segment (Sep-2023) Organization / Structure Category Trends Strategy Capital Allocation
(Feb-2024)
![Slide 11 Slide 11](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s11g1.jpg)
Overview Of Strategic Review,
Everest Management Plan And Preparation Process Basis of Presentation Everest management reviewed the historical performance and go-forward strategy of sub-segments within each of its four operating segments largely from a top-down perspective Based
on these plans, management prepared a consolidated view of their best estimate of financial performance over the next five years Timing Forecast was initially prepared by Everest’s management team for the purposes of strategic review, which
review was announced in October 2023 Based on 2023A results, forecast was updated in February 2024 and included a revised view based on the latest information available to management Differences vs. Ordinary Course Management typically prepares only
a three year plan but has extended its forecast through five years in conjunction with this process 2024 figures in current Everest Management Plan reflect higher targets vs. prior 2024 budget, as reviewed with Everest’s Board Source:Everest
Management Plan.
![Slide 12 Slide 12](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s12g1.jpg)
Everest Management Plan Overview
Revenue Adjusted EBITDA Unlevered FCF Pre-Tax OSP EE&R Representation Sport Data & Tech Corporate & Elim. Source:Everest Management Plan. Note:Dollars in billions. 2023A pro forma for WWE acquisition and IMG Academy divestiture as per
Everest Management Plan. n.a. % YOY Growth +21% (7%) +15% +5% +25% % Margin 21% 25% 27% 28% 27% 22% % Conversion 90% 83% 92% 107% 79% ’23A-’28E CAGR: +11% ’23A-’28E CAGR: +16% ’24E-’28E CAGR: +12%
![Slide 13 Slide 13](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s13g1.jpg)
$8.6 $7.6 $7.9 Overview Of Everest
Consensus Estimates Source Everest Management Plan and FactSet as of March 7, 2027. Note:Dollars in billions. FactSet consensus reflects median of available estimates, including additional brokers not shown. Estimate counts may not sum due to
identical estimates across multiple brokers. Revenue ($bn) Adjusted EBITDA ($bn) 2024E 2025E 2026E N = 8 N = 8 N = 3 N = 8 N = 8 N = 3 $8.2 $7.6 $7.5 $8.5 $8.7 $2.1 $1.8 $1.9 $1.9 $1.8 $1.7 $2.3 $2.3 Everest Mgmt. Plan Broker Estimate FactSet
Consensus $2.5 $2.2 $2.0 $1.9 $9.0 $8.5 $8.0 $8.1
![Slide 14 Slide 14](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s14g1.jpg)
Everest Management Plan Vs.
Consensus Source:Everest Management Plan and FactSet as of March 7, 2024. Note:Dollars in billions. 2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management Plan. (1)Management FCF reflects Unlevered FCF before tax.
’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. +25.1% +10.8% +20.7% (7.0%) +15.3% +4.9% +17.1% +1.0% +6.9% +6.8% % YoY Growth # Estimates 8 8 3 2 2 +11.1% Adj. EBITDA Mgmt. Cons. Margin 8 8 3 2 2 Unlevered FCF(1)
Mgmt. Cons. 70.2% 89.9% 83.1% 91.8% 107.0% 78.7% 69.6% 69.0% 65.5% 66.1% Conv. 2 2 1 1 1 +8.4% +108bps +129bps 21.6% 21.1% 24.8% 26.8% 28.1% 27.0% 21.6% 23.6% 25.0% 27.6% 28.2% 28.1% Ann. Margin Exp. 90.1% 68.1% Average Conv. # Estimates # Estimates
n.a.
![Slide 15 Slide 15](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s15g1.jpg)
Overview Of Key Revenue Models By
Segment Owned Sports Properties Events, Experiences & Rights Representation Sports Data & Technology Also includes Miami & Madrid, BJAC, Frieze, Fashion Events, HPWW and Other Events Also includes EuroLeague PBR Ticket sales Sponsorship
contracts (short & multi-yr) Television contracts Licensing agreements Ann. fees & recognition of franchise fees from team sales WWE UFC Content – Multi-yr rights contracts (e.g. Raw, Smackdown) Media – Multi-yr rights contracts
and subscription Live Events – Ticket sales Licensing agreements with min. guarantees and royalties Content – PPV, Media Rights, Fight Pass Subscription Live Events – Ticket sales, site fee contracts and other (VIP experiences,
Fight Club membership) Sponsorship and digital ad sales Licensing agreements with min guarantees and royalties WME Commission and service fees Upfront & backend fees from packages 160over90 Blend of retainer and project-based fees Non- Scripted
ProdCo Fees Fashion Commission and service fees On-Location IMG Media Primarily sales of tickets / packages, travel, hospitality Includes Super Bowl & NFL, College Sports, Music Events and Olympics Rights & Distribution – Multi-yr
contracts with pre-negotiated minimum fees or commissions Sports Production – Some multi-yr contracts, mostly auto-renewing single-yr contacts and one-off services Sport 24 & IMG Replay – Multi-yr contracts with pre-negotiated rates
IMG Arena OpenBet FastPath Data – Hybrid of fixed fee and revenue sharing Live Streaming – Primarily fixed fee or % of net gaming revenue Open Services – Cost-plus pricing Open Technology – Revenue sharing and license fees
Open Content – Revenue sharing and license fees Source:Everest Management Plan.
![Slide 16 Slide 16](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s16g1.jpg)
OSP business largely comprised of
UFC and WWE assets held through Kilimanjaro stake UFC and WWE rights renewals, including with Peacock (1.5-2x current AAV expected) 70-80% contribution margin on renewal revenues expected by management Raw distribution lapses for Q4 ’24E
(before NFLX deal) Expected decrease in number of teams and split in leagues followed by anticipated sale of teams in 2027 Segment Financial Overview: Owned Sports Properties Commentary Source:Everest Management Plan. Note:Dollars in millions. 2023A
pro forma for WWE acquisition as per Everest Management Plan. A B C UFCF Adj. EBITDA Revenue A B D C D D D B D
![Slide 17 Slide 17](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s17g1.jpg)
Segment Plan vs. Consensus: Owned
Sports Properties Source:Everest Management Plan and FactSet as of March 7, 2024. Note:Dollars in billions. 2023A pro forma for WWE acquisition as per Everest Management Plan. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue
Mgmt. Cons. % YoY Growth 3 3 1 1 1 +9.6% +8.2% Ann. Margin Exp. Adj. EBITDA Mgmt. Cons. Margin 3 3 1 1 1 +147bps +219bps # Estimates # Estimates 40.3% 44.0% 46.4% 47.6% 49.8% 51.2% 40.3% 42.9% 44.8% 47.0% 47.4% 47.7% +3.6% +8.4% +14.7% +9.0% +5.6%
+3.4% +10.2% +19.7% +8.2% +7.4% Individual Broker Estimates
![Slide 18 Slide 18](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s18g1.jpg)
Segment driven by IMG Media (rights
distribution) and On Location (events coordination) Includes major tennis events, fashion & art shows, and other experiences Events with continued partners driving meaningful EBITDA Cyclical segment P&L and cash flow profile driven by
semi-regular event schedule OLE contracted as Olympics event coordinator – first ever in Games’ history Idiosyncratic timing creates variability in cash flow profile Paris and Milan Olympics ticket sales expected mostly in year of while
LA ticket sales anticipated in year prior Segment Financial Overview: Events, Experiences & Rights Commentary Source:Everest Management Plan. Note:Dollars in millions. 2023A pro forma for IMG Academy divestiture as per Everest Management Plan.
UFCF Adj. EBITDA Revenue A A C C B C C D B D B C
![Slide 19 Slide 19](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s19g1.jpg)
Segment Plan vs. Consensus: Events,
Experiences & Rights Source:Everest Management Plan and FactSet as of March 7, 2024. Note:Dollars in billions. 2023A pro forma for IMG Academy divestiture as per Everest Management Plan. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E
2028E Revenue Mgmt. Cons. % YoY Growth 3 3 1 1 1 +8.9% +15.6% Ann. Margin Exp. Adj. EBITDA Mgmt. Cons. Margin 3 3 1 1 1 +124bps +75bps # Estimates # Estimates 9.1% 14.4% 12.7% 12.5% 11.3% 12.8% 9.1% 10.7% 12.5% 13.6% 14.0% 15.3% +52.0% (33.9%)
+22.3% (5.2%) +77.4% +42.5% (24.6%) +11.0% (13.8%) +49.1% Individual Broker Estimates
![Slide 20 Slide 20](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s20g1.jpg)
Houses William Morris Agency (WME)
business 72% of ’23A segment EBITDA Shifting “package” dynamics driven by streaming distribution and guild dictated terms ’24E topline recovery from depressed ’23A due to strikes Unscripted growth supported by
particular by deals with Asylum and F45 Pressure from strikes and incremental personnel investment expected to normalize to 30%+ margins (40% in 2022) Segment with relatively stable cash flow conversion given fee-based revenue models Segment
Financial Overview: Representation Commentary Source:Everest Management Plan. Note:Dollars in millions. UFCF Adj. EBITDA Revenue A B C D E A B C D E
![Slide 21 Slide 21](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s21g1.jpg)
Segment Plan vs. Consensus:
Representation Source:Everest Management Plan and FactSet as of March 7, 2024. Note:Dollars in billions. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. % YoY Growth 3 3 1 1 1 +9.0% +9.9% Ann. Margin Exp. Adj.
EBITDA Mgmt. Cons. Margin 3 3 1 1 1 +94bps +92bps # Estimates # Estimates 25.3% 28.3% 27.3% 29.9% 29.9% 29.9% 25.3% 24.1% 25.1% 26.7% 28.2% 30.0% +15.2% +8.6% +8.7% +8.4% +8.8% +9.3% +7.5% +17.2% +6.0% +5.5% Individual Broker Estimates
![Slide 22 Slide 22](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s22g1.jpg)
Contribution is relatively small vs.
other Everest segments Operating dynamics dominated by multi-year contracts and protracted sales cycle Weakness in 2024 sales cycle readout Loss of tennis contract results in decreased revenue in 2024 License renewal cycle in Open Tech. driving
irregular growth IMG Arena margin contraction driven by loss of TDI rights, offset by improvement in Football and Basketball OpenBet margin increase driven by mix shift to Open Tech. & Open Context Higher margin vs. Open Services business
Segment Financial Overview: Sports Data & Technology Commentary Source:Everest Management Plan. Note:Dollars in millions. Adj. EBITDA Revenue UFCF B A E B C C D D A E
![Slide 23 Slide 23](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s23g1.jpg)
Segment Plan vs. Consensus: Sports
Data & Technology Source:Everest Management Plan and FactSet as of March 7, 2024. Note:Dollars in billions. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. % YoY Growth 3 3 1 1 1 +14.6% +5.3% Ann. Margin Exp.
Adj. EBITDA Mgmt. Cons. Margin 3 3 1 1 1 +58bps +142bps # Estimates # Estimates 13.3% 16.0% 18.5% 20.0% 20.3% 20.4% 13.3% 13.2% 13.9% 16.9% 15.9% 16.2% (2.8%) +9.6% +10.9% +4.2% +5.4% +19.7% +14.9% +19.6% +11.0% +8.1% Individual Broker
Estimates
![Slide 24 Slide 24](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_2s24g1.jpg)
Project Everest – Illustrative
Process Timeline Timeline contemplates four distinct phases: Phase 1: Committee formation Phase 2: Diligence and access to management Phase 3: Preliminary views on valuation and initial legal documentation drafting Phase 4: Finalizing for target
signing and announce Note:As of March 7, 2024. (1)Including calls with CEO, CFO, other principals and business unit (Owned Sports Properties, Events, Experiences & Rights, Representation and Sports Data & Technology) leaders if possible. Key
Process Items Market Holiday Reference Good Friday and Easter Weekend (1) Illustrative timeline to be modified as events unfold Today As presented February 18 Kilimanjaro: 2/27 Everest: 2/28
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s1g1.jpg)
Confidential Discussion Materials
Project Everest March 21, 2024 Exhibit (C)(3)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior
written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the Board of Directors of Everest (in its capacity as such) in its
consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person. Centerview will not be responsible for and has not provided any tax,
accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or
opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s3g1.jpg)
Situation Update Following the prior
Special Committee meeting, Centerview has continued to engage with Everest management to further diligence Everest’s financial forecast and business outlook Additional calls held and data requests submitted over the past week to provide
clarifications and answers to questions posed by members of the Special Committee Diligence framework to compare current Everest plan to (1) historical performance, (2) analyst forecasts, (3) public guidance and (4) prior Everest management plans
Previously discussed preliminary findings have been incorporated herein to provide a more fulsome perspective on Everest’s financial plan Centerview will continue to work with Everest management to fully diligence certain incremental
topics
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s4g1.jpg)
Reminder: Everest Management Plan
Overview Revenue Adjusted EBITDA Unlevered FCF (Pre-Tax) OSP EE&R Representation Sport Data & Tech Corporate & Elim. Source: Everest Management Plan as of February 21, 2024 per Everest Management (the “Everest Management
Plan”). Note:Dollars in billions. 2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management Plan. n.a. % YOY Growth +21% (7%) +15% +5% +25% % Margin 21% 25% 27% 28% 27% 22% % Conversion 90% 83% 92% 107% 79%
’23A-’28E CAGR: +11% ’23A-’28E CAGR: +16% ’24E-’28E CAGR: +12% Includes $3.0bn of Paris (’24), Milan (’26) and LA (’28) Olympics contributions ~0.4bn of Olympics cash flow delta ’27E to
’28E
![Slide 5 Slide 5](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s5g1.jpg)
Reminder: Everest Management Plan
– 2023-2028 Drivers by Segment Revenue Growth By Segment Source:Everest Management Plan. Note: Dollars in millions. (1)Other reflects corporate costs, plan M&A and intersegment eliminations. +8.2% ’23A-’28E Rev. CAGR +15.6%
+9.9% +5.3% n.m. +11.1% +7.4pp ’23A – ’28E Margin Expansion +6.2pp +4.7pp +2.9pp n.m. +5.4pp EBITDA Growth by Segment 2028E Other(1) Sports Data & Tech. Representation Events, Experiences & Rights Owned Sports Properties
2023A 2028E Other(1) Sports Data & Tech. Representation Events, Experiences & Rights Owned Sports Properties 2023A ’23A-’27E CAGR: 7.9% ’23A-’27E Exp.: +6.5pp $1,703 Olympics contribution in ’28E $214 Olympics
contribution in ’28E
![Slide 6 Slide 6](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s6g1.jpg)
Reminder: Everest Management Plan
Overview ’23A ’27E / ’28E Source: Everest Management Plan. Note:2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management Plan. Does not include corporate, eliminations or go-forward M&A. Revenue
Adjusted EBITDA Unlevered FCF (Pre-Tax) Reflects 2024E FCF Figures OSP EE&R Representation Sport Data & Tech ’28E ’27E 43% 26% 25% 6% 63% 11% 22% 3% 58% 21% 19% 2%
![Slide 7 Slide 7](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s7g1.jpg)
Reminder: Everest Management Plan Vs.
Consensus Source:Everest Management Plan and FactSet as of March 20, 2024. Note:Dollars in billions. 2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management Plan. (1)Management FCF reflects Unlevered FCF before tax.
’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. +25.1% +10.8% +20.7% (7.0%) +15.3% +4.9% +19.3% (1.7%) +11.0% +3.8% % YoY Growth # Estimates 9 9 4 2 2 +11.1% Adj. EBITDA Mgmt. Cons. Margin 9 9 4 2 2 Unlevered
FCF(1) Mgmt. Cons. 70.2% 89.9% 83.1% 91.8% 107.0% 78.7% 69.6% 69.2% 65.8% 66.1% Conv. 2 2 1 1 1 +8.4% +108bps +129bps 21.6% 21.1% 24.8% 26.8% 28.1% 27.0% 21.6% 23.1% 25.2% 26.7% 28.2% 28.1% Avg. Ann. Margin Exp. 90.1% 68.2% Average Conv. # Estimates
# Estimates n.a.
![Slide 8 Slide 8](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s8g1.jpg)
Centerview’s Framework For
Everest Financial Plan Diligence Description vs. Analyst Forecasts (Consensus) Consideration of analyst perspectives on operating performance of Everest segments Implications of Everest management plan performance vs. current analyst expectations
Key Trends in Everest Plan Understanding of key assumptions underpinning financial plan Drivers across disparate business lines, including revenue and margin risks/opportunities vs. Public Management Guidance Review of historical commentary for
consistency with current plan Limited current forward guidance, but long-term targets and expectations still applicable vs. Historical Everest Performance Consideration of one-time impacts (e.g., COVID, strikes) on historical performance and read
through to forecast period Implications of business mix changes vs. Previous Everest Plans Understanding of evolution of management perspectives on expected performance Review of key changes over relevant period, including during and following
announcement of strategic alternatives Everest Plan in Context
![Slide 9 Slide 9](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s9g1.jpg)
Everest Financial Plan Diligence: Owned
Sports Properties Observations vs. Analyst Forecasts (Consensus) Key Trends in Everest Plan ’23 –’28 revenue CAGR driven by UFC (+$578mm, +7.7%) and WWE (+$613mm, +7.9%) Strong PBR ’23 –’28 growth rate driven by
new teams (+15.6%), with dollar contribution +$140mm EBITDA growth similarly driven by UFC (+$399mm; +5.1pp margin expansion) and WWE synergy realization (+$391mm; +10.3pp margin expansion) vs. Public Management Guidance vs. Historical Everest
Performance vs. Previous Everest Plans Everest Plan in Context Historical double-digit revenue growth driven by COVID recovery (e.g., Live Events resuming) Combination of WWE and UFC into Kilimanjaro unlocked synergy opportunity (~$123mm run rate
with $111mm realized in 2024) WWE Raw rights renewal at 1.4x, while future Kilimanjaro media rights assumed to renew at 1.5x Kilimanjaro component of OSP largely in-line with consensus, driven by annual average margin expansion ~+40bps vs.
consensus, but ’23 –’28 revenue CAGR ~110bps below consensus 2028 management margin ~210bps higher vs. consensus Limited broker estimates for Kilimanjaro long-term cash flow profile Management has withdrawn Everest guidance due to
strategic review; Everest plan for UFC and WWE better than Kilimanjaro public guidance for Revenue and EBITDA Commentary historically focused on AAV step up expectations during media rights renewals Expectations of 1.0x+ increase and noting of
recent deals at 1.4x largely in-line with 1.5x in latest plan 2024 WWE revenue lower by ($75mm) vs. November LRP largely due to timing of Netflix Raw deal Instead of beginning in Q4’24, deal will begin on January 1, 2025 Rights renewed at 1.4x
AAV vs. 1.5x assumed in November 2023 LRP UFC and PBR projections are largely in-line with 3-year plan, as presented in Q4’22 Source:Everest Management Plan and FactSet as of March 20, 2024. Note: Dollars in millions.
![Slide 10 Slide 10](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s10g1.jpg)
Performance Decomposition: Owned
Sports Properties Revenue Growth By Segment ($mm) EBITDA Growth by Segment ($mm) Source:Everest Management Plan. Note:Dollars in millions. 2023A pro forma for WWE acquisition as per Everest Management Plan. +7.7% ’23A-’28E Rev. CAGR
+7.9% +15.6% (10.0%) +8.2% +5.1pp +10.3pp +14.6pp (10.6)pp +7.4pp ’23A – ’28E Margin Expansion Incremental details provided on following pages Incremental details provided on following pages
![Slide 11 Slide 11](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s11g1.jpg)
OSP business largely comprised of
UFC and WWE assets held through Kilimanjaro stake UFC and WWE rights renewals, including with Peacock (1.5-2x current AAV expected) 70-80% contribution margin on renewal revenues expected by management Raw distribution lapses for Q4 ’24E
(before NFLX deal) Expected decrease in the number of teams being sold Deferred sale of six new teams to 2027E due to league capacity in conjunction with expected conference creation EuroLeague JV autorenewal assumed in in 2026E. Everest management
fee falling from 17.5% to 12.5% of gross profit after Team Distributions on renewal Segment Financial Overview: Owned Sports Properties Commentary Source:Everest Management Plan and diligence responses provided. Note:Dollars in millions. 2023A pro
forma for WWE acquisition as per Everest Management Plan. A B C UFCF Adj. EBITDA Revenue A B D C D D D B D 1 1 Preliminary views on model Incremental findings from diligence
![Slide 12 Slide 12](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s12g1.jpg)
Segment Plan vs. Consensus: Owned
Sports Properties Source:Everest Management Plan and FactSet as of March 20, 2024. Note:Dollars in billions. 2023A pro forma for WWE acquisition as per Everest Management Plan. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue
Mgmt. Cons. % YoY Growth 3 3 1 1 1 +9.6% +8.2% Adj. EBITDA Mgmt. Cons. Margin 3 3 1 1 1 +147bps +219bps # Estimates # Estimates 40.3% 44.0% 46.4% 47.6% 49.8% 51.2% 40.3% 42.9% 44.8% 47.0% 47.4% 47.7% +3.6% +8.4% +14.7% +9.0% +5.6% +3.4% +10.2%
+19.7% +8.2% +7.4% Individual Broker Estimates Avg. Ann. Margin Exp.
![Slide 13 Slide 13](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s13g1.jpg)
Everest Financial Plan Diligence:
Events, Experiences & Rights Observations vs. Analyst Forecasts (Consensus) Key Trends in Everest Plan vs. Public Management Guidance vs. Historical Everest Performance vs. Previous Everest Plans Everest Plan in Context ’24
–’28 revenue CAGR driven largely by timing of Olympics On Location contract (+$692mm) Excluding Olympics contribution, ’24 –’28 revenue CAGR largely driven by On Location (+$159mm; +6.1% CAGR), though other events(1)
contribute +$126mm revenue growth Similar EBITDA contribution dynamics with Olympics contributing outsized growth due to timing Events business impacted by COVID shutdowns in 2020 and 2021, resulting in artificially low bases for growth Future
comparison of consolidated segment growth vs. historical performance is impacted by cyclical nature of Olympics contract Management forecast largely in-line with consensus expectations, though broker estimates for 2028 are ~$1bn lower vs. management
forecast, driven by stronger Olympics performance Management expecting margins ~370bps lower than consensus in 2024, but ~250bps higher than consensus in 2028, though limited broker coverage of Everest segments Guidance for “multiple 9-figure
profit opportunity” is in-line with ~$718mm cumulative ’24 – ’28 pre-tax FCF Near-term profit growth impacts due to scale of investment further aligned with margin expansion runway in forecast Higher costs, largely driven by
Olympics spending, results in ($60mm) less EBITDA in 2025 vs. Q4’22 3-year plan Other changes driven by lower events revenue and lower IMG media margins, but impact to EBITDA is largely mitigated Source:Everest Management Plan and FactSet as
of March 20, 2024. Note: Dollars in millions.
![Slide 14 Slide 14](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s14g1.jpg)
Performance Decomposition: Events,
Experiences & Rights Revenue Growth By Segment ($mm) EBITDA Growth by Segment ($mm) Source:Everest Management Plan. Note:Dollars in millions. Performance shown against 2024E base year for comparability, given IMG Academy sale impact to business
unit financials. (1)Other EE&R represents: HPWW, Miami, Madrid, BJAC, Frieze, Fashion Events, Event Mgmt., Streaming, Versity and Other Events businesses. +3.9% ’24E-’28E Rev. CAGR +6.1% +13.9% +4.0% +8.0% +3.2pp +2.1pp +5.8pp +8.2pp
+4.6pp (1) (1) ’24E – ’28E Margin Expansion Incremental details provided on following pages Incremental details provided on following pages ’23A EE&R Revenue: $1,999mm ’23A EE&R EBITDA: $181 mm
![Slide 15 Slide 15](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s15g1.jpg)
Segment driven by IMG Media (rights
distribution) and On Location (events coordination) Big Football expected to fully roll off in 2027E following the expiration of La Liga and Serie A in 2021 Includes major tennis events, fashion & art shows, and other experiences Events with
continued partners driving EBITDA Paris and Milan Olympics ticket sales expected mostly in year of while LA ticket sales anticipated in year prior Cyclical segment P&L and cash flow profile driven by semi-regular event schedule OLE contracted as
Olympics event coordinator – first ever in Games’ history Idiosyncratic timing creates variability in cash flow profile $13mm EFL Studios production capability expansion cost in 2024 drove Capex higher vs. historical levels Segment
Financial Overview: Events, Experiences & Rights Commentary Source:Everest Management Plan and diligence responses provided. Note:Dollars in millions. 2023A pro forma for IMG Academy divestiture as per Everest Management Plan. UFCF Adj. EBITDA
Revenue A A C B C C D B D B C 2 2 C 1 1 Preliminary views on model Incremental findings from diligence
![Slide 16 Slide 16](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s16g1.jpg)
Segment Plan vs. Consensus: Events,
Experiences & Rights Source:Everest Management Plan and FactSet as of March 20, 2024. Note:Dollars in billions. 2023A pro forma for IMG Academy divestiture as per Everest Management Plan. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E
2028E Revenue Mgmt. Cons. % YoY Growth 3 3 1 1 1 +8.9% +15.6% Adj. EBITDA Mgmt. Cons. Margin 3 3 1 1 1 +124bps +75bps # Estimates # Estimates 9.1% 14.4% 12.7% 12.5% 11.3% 12.8% 9.1% 10.7% 12.5% 13.6% 14.0% 15.3% +52.0% (33.9%) +22.3% (5.2%) +77.4%
+42.5% (24.6%) +11.0% (13.8%) +49.1% Individual Broker Estimates Avg. Ann. Margin Exp.
![Slide 17 Slide 17](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s17g1.jpg)
Everest Financial Plan Diligence:
Representation Observations vs. Analyst Forecasts (Consensus) Key Trends in Everest Plan vs. Public Management Guidance vs. Historical Everest Performance Vs. Previous Everest Plans Everest Plan in Context WME 2023 base impacted by strikes, but
growth expected to rebound over multiple years Expected revenue contribution of +$522mm; 9.6% CAGR from 2023 to 2028 Non-scripted a large area of revenue growth, driven by new hires WME margins expected to be in-line with ~35-40% long-term target by
2027 WME historical performance and resulting near-term historical results impacted by both COVID and strikes Segment growth largely driven by WME, in-line with historical performance Management plan largely in-line with consensus expectations
Long-term margin trajectory in-line with analyst view, though consensus assumes a slightly faster path to achieve long-term targets ’23 –’28 revenue CAGR +90bps vs. consensus Publicly noted expectations for growth in-line with
historical double digit revenue growth, which is largely in-line with 9.9% ’23 –’28 revenue CAGR 30%+ long-term margin target in-line with 2028E EBITDA margin of 30% Strike impacting timing to achieve long-term margin targets, as
previously disclosed Strikes resulting in ($141mm) lower revenue in 2025 vs. Q4’22 3-year plan 2024 and 2025 growth largely in-line with pre-strike expectations, given timing of Hollywood production ramp and capacity limitations on a number of
productions Launch of WME Sports a headwind to margin profile as new agents ramp productivity Source:Everest Management Plan and FactSet as of March 20, 2024. Note: Dollars in millions.
![Slide 18 Slide 18](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s18g1.jpg)
Performance Decomposition:
Representation Revenue Growth By Segment ($mm) EBITDA Growth by Segment ($mm) Source:Everest Management Plan. Note:Dollars in millions. +9.6% ’23A-’28E Rev. CAGR +9.8% +5.7% +2.5% +23.5% +9.9% +7.5pp +6.2pp +1.3pp +0.7pp +11.3pp +4.7pp
’23A – ’28E Margin Expansion Incremental details provided on following pages Incremental details provided on following pages
![Slide 19 Slide 19](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s19g1.jpg)
Houses William Morris Endeavor (WME)
business 72% of ’23A segment EBITDA Shifting “package” dynamics driven by streaming distribution and guild dictated terms Expectation of revenue neutrality from Package dynamics as commissions replace Package revenue ’24E
topline recovery from depressed ’23A due to strikes Unscripted growth supported in particular by deals with Asylum and F45 Pressure from strikes and incremental personnel investment expected to normalize to 30%+ margins (40% in 2022) Segment
with relatively stable cash flow conversion given fee-based revenue models Segment Financial Overview: Representation Commentary Source:Everest Management Plan and diligence responses provided. Note:Dollars in millions. UFCF Adj. EBITDA Revenue A B
C D E A B C D E 1 1 Preliminary views on model Incremental findings from diligence
![Slide 20 Slide 20](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s20g1.jpg)
Segment Plan vs. Consensus:
Representation Source:Everest Management Plan and FactSet as of March 20, 2024. Note:Dollars in billions. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. % YoY Growth 3 3 1 1 1 +9.0% +9.9% Adj. EBITDA Mgmt. Cons.
Margin 3 3 1 1 1 +94bps +92bps # Estimates # Estimates 25.3% 28.3% 27.3% 29.9% 29.9% 29.9% 25.3% 24.1% 25.1% 26.7% 28.2% 30.0% +15.2% +8.6% +8.7% +8.4% +8.8% +9.3% +7.5% +17.2% +6.0% +5.5% Individual Broker Estimates Avg. Ann. Margin Exp.
![Slide 21 Slide 21](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s21g1.jpg)
Everest Financial Plan Diligence:
Sports Data & Technology Observations vs. Analyst Forecasts (Consensus) Key Trends in Everest Plan vs. Public Management Guidance vs. Historical Everest Performance Vs. Previous Everest Plans Everest Plan in Context Both OpenBet and IMG Arena
expected to grow, with IMG Arena ’23 –’28 revenue CAGR of +5.8% outpacing OpenBet revenue CAGR by ~120bps, but some near-term headwinds Management expects weakness in 2024 sales cycle, with (2%) YoY declines expected at IMG Arena
and (4%) YoY declines at OpenBet, largely driven by the loss of the TDI tennis contract OpenBet acquisition in 2022 distorting historical financial performance Recent operational challenges continue to pressure growth and margin IMG Arena growth
outlook muted vs. historical performance, largely driven by insourcing of white label betting solution by key customers Management plan below analyst expectations through 2028, though small contributor to total Everest financial profile Only one
analyst providing segment-level financial projections through 2028 Margin expansion muted by lower operating leverage vs. analyst expectations Previously disclosed data costs pressuring margins and the loss of the TDI tennis contract, which may
inform near-term investor perspectives Brokers beginning to calibrate towards management EBITDA margin expansion of +2.9pp from 2023 to 2028, based on early 2024 disclosure Reduction in 2025E EBITDA ($47mm lower from IMG Arena and $29mm lower from
OpenBet) largely driven by weaker 2023/2024 sales cycle and loss of TDI tennis contract Also lower vs. November 2023 plan, driven by TDI contract loss Expected performance largely in-line with 2024 budget Source:Everest Management Plan and FactSet
as of March 20, 2024. Note: Dollars in millions.
![Slide 22 Slide 22](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s22g1.jpg)
Performance Decomposition: Sports
Data & Technology Revenue Growth By Segment ($mm) EBITDA Growth by Segment ($mm) Source:Everest Management Plan. ’23A-’28E Rev. CAGR +5.8% +4.6% +5.3% (1.4)pp +10.2pp +2.9pp ’23A – ’28E Margin Expansion Incremental
details provided on following pages
![Slide 23 Slide 23](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s23g1.jpg)
Contribution is modest vs. other
Everest segments Operating dynamics dominated by multi-year contracts and protracted sales cycle Weakness in 2024 sales cycle readout Loss of tennis contract results in decreased revenue in 2024 Go-forward IMG Arena topline weakness in rights market
as sports books are expected to lower spend License renewal cycle in Open Tech. driving irregular growth License fee revenue recognized upfront IMG Arena margin contraction driven by loss of TDI rights, offset by improvement in Football and
Basketball OpenBet margin increase driven by mix shift to Open Tech. & Open Context Higher margin vs. Open Services business Segment Financial Overview: Sports Data & Technology Commentary Source:Everest Management Plan and diligence
responses provided. Note:Dollars in millions. Adj. EBITDA Revenue UFCF B A E B C C D D A E 1 1 2 2 Preliminary views on model Incremental findings from diligence
![Slide 24 Slide 24](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s24g1.jpg)
Segment Plan Vs. Consensus: Sports
Data & Technology Source:Everest Management Plan and FactSet as of March 20, 2024. Note:Dollars in billions. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. % YoY Growth 3 3 1 1 1 +14.6% +5.3% Adj. EBITDA Mgmt.
Cons. Margin 3 3 1 1 1 +58bps +142bps # Estimates # Estimates 13.3% 16.0% 18.5% 20.0% 20.3% 20.4% 13.3% 13.2% 13.9% 16.9% 15.9% 16.2% (2.8%) +9.6% +10.9% +4.2% +5.4% +19.7% +14.9% +19.6% +11.0% +8.1% Individual Broker Estimates Avg. Ann. Margin
Exp.
![Slide 25 Slide 25](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s25g1.jpg)
Summary Of Additional Diligence
Underway Topic Description Next Steps for Discussion with Committee Tax Cash Flow Continuing discussions with management about current tax expectations and structure Includes implications on TRA payment expectations and use of NOLs Call held with
Everest tax and finance teams Current management forecast builds to unlevered, untaxed free cash flow
![Slide 26 Slide 26](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s26g1.jpg)
Everest Plan Diligence Support
Supplemental Materials
![Slide 27 Slide 27](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s27g1.jpg)
Overview Of Key Components Of
Corporate Expense Commentary $mm % Sales Commun-ications ($23) ($18) ($21) ($19) ($26) 0.3% 0.2% 0.2% 0.2% 0.2% Includes corporate communications, PR and hospitality event marketing spend with larger hospitality spend in advance of the Olympics $mm
% Sales Corp. Exec. ($66) ($68) ($70) ($72) ($74) 0.8% 0.9% 0.8% 0.8% 0.7% C-Suite costs for CEO, Executive Chair, COO and CFO Includes transportation (e.g., plane) and other costs $mm Technology ($43) ($45) ($46) ($48) ($50) 0.5% 0.6% 0.5% 0.5%
0.4% Everest IT infrastructure costs for daily operations and development of internal systems built / maintained at Everest $mm % Sales Human Resources ($28) ($26) ($27) ($28) ($29) 0.4% 0.3% 0.3% 0.3% 0.3% Personnel and infrastructure (e.g.,
Workday) costs for Everest HR department Source:Everest Management Plan and diligence responses provided. (1)Includes Kilimanjaro and Streaming management fees. Excludes Everest China. % Sales ($324) $mm ($328) ($339) ($348) ($368) 4.0% 4.3% 3.9%
3.8% 3.2% % Sales Total Corporate(1) Total corporate spend ranges from ~3% to ~4.5% percent of Everest revenue
![Slide 28 Slide 28](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s28g1.jpg)
Pro Forma Everest Revenue Growth
Profile Source:Everest Management Plan. Note: Dollars in millions. (1)Includes Miami and Madrid. n.a. (1) Historical Projection n.a.
![Slide 29 Slide 29](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s29g1.jpg)
Pro Forma Everest Adj. EBITDA Margin
Profile Source:Everest Management Plan. Note: Dollars in millions. (1)Includes Miami and Madrid. n.a. (1) Historical Projection n.a.
![Slide 30 Slide 30](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s30g1.jpg)
“[EE&R] profit growth will
continue to be impacted by our ongoing investments and On Location to IOC initiative. We are continuing to build our sales, marketing and ticketing technology functions… We anticipate multiple 9 figure profit opportunities across the 3
upcoming Olympic Games” Jason Lublin (CEO) Feb-’23 Olympic Opp. “[N]ew data costs continue to create temporary pressure on segment margins, which we anticipated. We continue to expect to monetize these data rights in the upcoming
sales cycle” Jason Lublin (CFO) Aug-’23 “We look at representation now because of where the platforms are, how important sports is…That's why we made the play that we made…the representation business has grown double
digits excluding 2020 for the last 10 years. So it's a very, very kind of predictable business” Ari Emanuel (CEO) Dec-’21 “[Recent] deals delivered an increase of more than 1.4x in AAV. Exceeding expectations on guidance” Ari
Emanuel (CEO) Feb-’24 “The increase in our aggregate AAV remains approximately 100% over prior deals since we began tracking in Q2 of 2021” A. Emanuel (CEO) Aug-’23 Everest Guidance To The Public Rights Renewal & AAV
Public Guidance Everest Margin OSP “As far as the EBITDA margins go, part of it, the 34% was the mix shift in the quarter between WME or 160over90 business and licensing. But we should be 30-plus margin for [Representation] on a go-forward
basis” Jason Lublin (CFO) Nov-’22 Growth Profile Go-Forward Margin Representation EE&R SD&T 1.5x current AAV for 2026 UFC U.S. Rights Renewal $718mm in Olympic FCF before Taxes +9.9% ’23A-28E Topline CAGR 30.0% EBITDA
Margin in 2028E +2.9pp EBITDA Margin Expansion ’23A-’28E Source:Everest Management Plan and company filings.
![Slide 31 Slide 31](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s31g1.jpg)
Evolution Of Everest Management
Long-Range Plan ’24 Budget (Feb-’24) Owned Sports Properties Events, Experiences & Rights Representation Sports Data & Tech. ’24E UFC Revenue 4% lower ($53mm) ’24E EBITDA margin 0.6pp lower ’24E Events Revenue
3% lower ($23mm) ’24E EBITDA margin in-line ’24E Non-scripted Revenue 19% higher ($42mm) ’24E Non-scripted EBITDA margin 0.5pp higher Largely in-line Everest LRP (Nov-’23) WWE Revenue lower while margins largely in-line as
new rights deal with Netflix finalized IMG Media Revenue lower with EBITDA margins ~1pp lower throughout WME Revenue and EBITDA margin higher in the front-end but lower in the out-years Arena revenue lower throughout Both Arena and Open Bet margins
lower given ’23 /’24 sales cycle weakness Q4 ’22 3Y Plan Largely in-line ’25E On Location EBITDA $60mm lower from increased digital costs ’25E WME EBITDA $141mm lower given strike impact ’25E Arena EBITDA $47mm
lower ’25E Open Bet EBITDA $29mm lower given ’23 / ’24 sales cycle weakness Source:Everest Management Plan. Note: Dollars in millions. October 2023 Orlando management meeting materials also reviewed, however management communicated
these projections were not developed for financial planning and should not be used as the basis of financial analysis. Comparison to
![Slide 32 Slide 32](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s32g1.jpg)
Comparison Of 2024 Budget Vs.
Current LRP Source:Everest Management Plan. Note: Dollars in millions. Current LRP provided February 21, 2024. ’24 Budget reflects figures in “2.11.2024 Model” as provided by Everest management. OSP EE&R Rep SD&T Revenue
EBITDA % EBITDA Margin
![Slide 33 Slide 33](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s33g1.jpg)
Revenue Comparison: Current LRP Vs.
November 2023 Plan November 2023 LRP Current LRP Delta Source:Everest Management Plan. Note: Dollars in millions. Current LRP provided February 21, 2024. November 2023 LRP provided in the “Variance Analysis (2024.02.27)” file.
![Slide 34 Slide 34](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s34g1.jpg)
EBITDA Comparison: Current LRP Vs.
November 2023 Plan November 2023 LRP Current LRP Delta Source:Everest Management Plan. Note: Dollars in millions. Current LRP provided February 21, 2024. November 2023 LRP provided in the “Variance Analysis (2024.02.27)” file.
![Slide 35 Slide 35](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s35g1.jpg)
EBITDA Margin Comparison: Current
LRP Vs. Nov. 2023 Plan November 2023 LRP Current LRP Delta Source:Everest Management Plan. Note: Dollars in millions. Current LRP provided February 21, 2024. November 2023 LRP provided in the “Variance Analysis (2024.02.27)” file.
![Slide 36 Slide 36](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s36g1.jpg)
Comparison Of Q4’22 3-Year
Plan Vs. Current LRP A OSP EE&R Rep SD&T Management Commentary B C D E F G H I J K L Teams series Slow sports production growth Frieze acquisitions / Tennis growth Higher Olympic / Digital costs Assumed sales / growth off plan Impact of
strikes and WME Sports hires Market impact of sales cycle FanDuel 3-yr Renewal in ’23 & Other Tier-1 Losses Increased Kilimanjaro mgmt. fee Assumed reduction Moved to On-Location and reduced costs General M&A bucket A B C D E F G H I J
K L Source:Everest Management Plan. Note: Dollars in millions. Current LRP provided February 21, 2024. Q4’22 Budget reflects the 3YP comparison provided in the “2025 Compare” file.
![Slide 37 Slide 37](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_3s37g1.jpg)
Kilimanjaro In Everest Management
Plan Vs. Consensus Source:Everest Management Plan and FactSet as of March 20, 2024. Note:Dollars in billions. 2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management Plan. (1)Management FCF reflects Unlevered FCF
before tax. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E 2028E Revenue Mgmt. Cons. +5.7% +2.7% +2.8% +8.3% +15.3% +7.3% +1.4% +11.1% +12.8% +6.1% % YoY Growth # Estimates 16 16 12 4 2 +7.8% Adj. EBITDA Mgmt. Cons. Margin 16 16 12 4
Unlevered FCF(1) Mgmt. Cons. n.a. 91.7% 92.5% 93.1% 93.2% 93.4% 78.6% 78.5% n.a. n.a. Conv. 1 1 0 0 0 +6.7% +154bps +197bps 41.8% 44.4% 46.4% 48.6% 49.2% 49.5% 41.8% 44.0% 46.8% 48.1% 49.2% 51.6% 92.8% 78.6% Average Conv. # Estimates # Estimates
n.a. Mgmt. plan higher than ’24E public guide of $2.575-2.65bn Mgmt. plan higher than ’24E public guide of $1.15-1.17bn Avg. Ann. Margin Exp. 2
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s1g1.jpg)
Confidential Discussion Materials
Project Everest March 29, 2024 Exhibit (C)(4)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of
its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would
create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis
described above should not be taken to be Centerview’s view of the actual value of Everest. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed
publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the
Board of Directors of Everest (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person.
Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation
does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s3g1.jpg)
Everest Management Plan Overview
Revenue Adjusted EBITDA Unlevered FCF (Pre-Tax) OSP EE&R Representation Sport Data & Tech Corporate & Elim. Source: Everest Management Plan per Everest Management (the “Everest Management Plan”). Note:Dollars in billions.
2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management. n.a. % YOY Growth +21% (7%) +15% +5% +25% % Margin 21% 25% 27% 28% 27% 22% % Conversion 90% 83% 92% 107% 79% ’23A-’28E CAGR: +11%
’23A-’28E CAGR: +16% ’24E-’28E CAGR: +12% Includes $3.0bn of Paris (’24), Milan (’26) and LA (’28) Olympics contributions ~0.4bn of Olympics cash flow delta ’27E to ’28E
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s4g1.jpg)
Everest Management Plan –
2023-2028 Drivers By Segment Revenue Growth By Segment Source:Everest Management Plan. Note:Dollars in millions. (1)Other reflects corporate costs, planned M&A and intersegment eliminations. +8.2% ’23A-’28E Rev. CAGR +15.6% +9.9%
+5.3% n.m. +11.1% +7.4pp ’23A – ’28E Margin Expansion +6.2pp +4.7pp +2.9pp n.m. +5.4pp EBITDA Growth by Segment 2028E Other(1) Sports Data & Tech. Representation Events, Experiences & Rights Owned Sports Properties 2023A
2028E Other(1) Sports Data & Tech. Representation Events, Experiences & Rights Owned Sports Properties 2023A ’23A-’27E CAGR: 7.9% ’23A-’27E Exp.: +6.5pp $1,703 Olympics contribution in ’28E $214 Olympics
contribution in ’28E
![Slide 5 Slide 5](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s5g1.jpg)
Overview Of Everest Segments Revenue
EBITDA Source:Everest Management Plan. Note:Dollars in billions.
![Slide 6 Slide 6](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s6g1.jpg)
Key Focus Areas For Cashflow To Everest
Class A Shareholders Source:Everest Management and FactSet as of March 28, 2024. Note:Reflects Everest Capitalization, per management, inclusive of 128.8mm OpCo units and 2.2mm Profit Units. EOC contractually obligated to distribute ~50% of taxable
earnings to the OpCo Unit Holders and through Everest Manager to EGH; distributions have historically been on a pro rata basis and are expected to remain as such as per Everest Management. EGH and Everest Manager, LLC are taxed on a consolidated
basis as one entity at a corporate tax rate of ~26% as per Everest Management. OpCo Unit Holders liable for tax (at various individual tax rates) on the 28% of EOC earnings attributable to the OpCo Unit Holders. Public Company Everest Class A
Shareholders Everest Group Holdings, Inc. (“EGH”) NYSE Listed Everest Manager, LLC Everest OpCo, LLC (“EOC”) Certain Pre-IPO Investors, Employees & Management (“OpCo Unit Holders”) 28% Own. 72% Own. 51% Own.
49% Own. Certain Pre-IPO Investors, Employees & Management Public Company Kilimanjaro Class A Shareholders Control maintained through Class X and Class Y Shares Kilimanjaro OpCo, LLC Control maintained through Class B Shares Everest Business
Operations Kilimanjaro Group Holdings, Inc. NYSE Listed 1 2 3 4 1 100% EOC ownership of Everest business operations excluding Kilimanjaro (pre-tax) 51% EOC ownership of Kilimanjaro (pre-tax) EOC is a passthrough (pre-tax) entity, with taxes paid by
OpCo Unit Holders and EGH(1) Corporate tax at EGH of ~26%(2) on the 72% of EOC earnings attributable to EGH (tax outflow)(3) 2 3 4
![Slide 7 Slide 7](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s7g1.jpg)
Overview Of Everest Key Shareholders
EGH Beneficial Ownership Summary (1) (2) (3) (4) (4) (5) Source:FactSet as of March 28, 2024. Note: Reflects Everest Capitalization, per management, inclusive of 128.8mm OpCo units and 2.2mm Profit Units. Shares held by Everest Executive HoldCo,
Everest Executive II HoldCo and Everest PIU HoldCo apportioned pro rata based on ownership, with Ari Emanuel holding 45% (9.6mm Class X shares, Class Y shares and OpCo Units), 46% (1.3mm Class X shares, Class Y shares and OpCo units) and 0% of each
entity’s shares and Patrick Whitesell holding 41% (8.8mm Class X shares, Class Y shares and OpCo units), 46% (1.3mm Class X shares, Class Y shares and OpCo units) and 0% of each entity’s shares, respectively. Each Class A Share is
entitled to 1 vote and 1 economic share. Each Class X Share is entitled to 1 vote (and no economic share). Each Class Y Share is entitled to 20 votes (and no economic share). Redeemable for a Class A Share if surrendered alongside a Class X (or
Class X and Class Y) share(s). Includes options on an as-converted basis under treasury stock method, RSUs, PSUs and Phantom Units.
![Slide 8 Slide 8](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s8g1.jpg)
Valuation Methodologies Illustrative
Discounted Cash Flow Analysis Discounted cash flow analysis based on Everest Management Plan Includes benefits of tax attributes under Everest’s tax receivable agreement, from NOLs and finite life D&A Selected Public Comparable Companies
Analysis Selected comparable public companies for Everest ex-Kilimanjaro and Kilimanjaro Illustrative EV / ’24E EBITDA multiples applied to respective Everest Management Plan EBITDA Analyst Price Targets Low to high range of analyst price
targets for Everest 52-Week Closing Share Price Range Low to high range of Everest trading levels over the past 52 weeks For reference only
![Slide 9 Slide 9](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s9g1.jpg)
Preliminary Everest Valuation Analysis
Low: 10/23/2023 High: 04/25/2023 Everest ex-Kili. WACC: 10.50% - 12.00% 51% Kilimanjaro WACC: 9.50% - 11.00% Everest Tax Assets WACC: 10.50% - 12.00% Source:Company filings, analyst research, Everest Management Plan, Everest Tax Asset Projection per
Everest management (the “Everest Tax Asset Projection”) and FactSet as of March 28, 2024. Note:Reflects Everest net debt of $4,112mm and $215mm of NCI as of December 31, 2023 as per company filings; adjusted for Kilimanjaro net debt as
applicable, based on subsequent analysis (see following pages for detail). Capitalization as of March 8, 2024 as provided by Everest Management: 301.1mm shares outstanding, 150.9mm OpCo and Manager Units not held by Everest Manager or EGH, 10.6mm
RSUs, 15.2mm Profit Units with a WAEP of $21.96, 4.1mm options with a WAEP of $25.49 and 0.8mm Phantom Units with a WAEP of $3.89 (the “Everest Capitalization”). Implied share price ranges rounded to the nearest $0.05. Reflects closing
prices for the 52-week period ending as of March 28, 2024. (1) $25.73 (Current Share Price) $34.80 $26.30 Excl. Tax Assets Everest ex-Kili. ($523mm ’24E EBITDA): 9.5x – 12.0x 51% of Kilimanjaro ($611mm ’24E EBITDA): 13.5x –
18.0x High Low (Aug-23) (Jan-24) Discounted Cash Flow Analysis Including Value of Tax Assets (Finite Life D&A, TRA & NOLs) Selected Public Comparable Companies Analysis (2)
![Slide 10 Slide 10](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s10g1.jpg)
C E G F Sep-21 – Everest
announces acquisition of OpenBet for $1.2bn Nov-21 – Everest sells controlling stake in content business for $850mm May-22 – Everest reports first quarter 2022 earnings Apr-23 – Everest announces intention to combine UFC and WWE
assets Aug-23 – PFL(1) receives a reportedly $100mm minority investment from SRJ (Saudi sovereign wealth fund backed sports investment vehicle) Sep-23 – Kilimanjaro begins trading as UFC / WWE transaction closes Oct-23 – Everest
announces consideration of strategic alternatives Everest Stock Price Performance Since IPO Source:Company filings and FactSet as of March 28, 2024. Note: Starting share price reflects first trading day closing share price. S&P500 performance
indexed to Everest share price as of April 29, 2021. Professional Fighters League. Kilimanjaro indexed to Everest closing share price as of September 12, 2023. $25.20 +25% $25.73 +2% Everest S&P500 Share Price Performance Since IPO Public Market
Events A B C D E F B D G Russian invasion of Ukraine (Feb), Fed hikes interest rates 25bps (Mar) A Kili. $18.57 (16%) 52W H: $25.88 52W L: $17.67 (2)
![Slide 11 Slide 11](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s11g1.jpg)
Everest Management Plan Vs.
Consensus Source:Everest Management Plan and FactSet as of March 28, 2024. Note:Dollars in billions. 2023A pro forma for WWE acquisition and IMG Academy divestiture as per Everest Management. ’23A-’28E CAGR 2023A 2024E 2025E 2026E 2027E
2028E Revenue Mgmt. Cons. +25.1% +11.8% +20.7% (7.0%) +15.3% +4.9% +14.7% +2.2% +9.7% +4.1% % YoY Growth # Estimates 9 9 5 2 2 +11.1% Adj. EBITDA Mgmt. Cons. Margin 9 9 5 3 2 +8.4% +108bps +129bps 21.6% 21.1% 24.8% 26.8% 28.1% 27.0% 21.6% 24.2%
25.3% 26.9% 26.5% 28.1% Avg. Ann. Margin Exp. # Estimates
![Slide 12 Slide 12](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s12g1.jpg)
Selected Everest Analyst Price
Targets Source:Analyst research as of March 28, 2024. TD Cowen also includes valuation by DCF (11x EV/EBITDA terminal value). Aug-23 Feb-24 Feb-24 Feb-24 Mar-24 Feb-24 Jan-24 Average PT: $31 (+22% to Current Price) Current Price: $25.73 Buy Hold
Sell (1) +40% +28% +24% +24% +21% +17% +13% +9% Feb-24 Focus on SOTP amongst brokers reflect the diversity of assets under Everest umbrella Prem. vs. Current
![Slide 13 Slide 13](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s13g1.jpg)
Selected Kilimanjaro Analyst Price
Targets Source:Analyst research as of March 28, 2024. Average PT: $108 (+25% to Current Price) Current Price: $86.41 Buy Hold Sell Feb-24 Mar-24 Mar-24 Feb-24 Mar-24 Mar-24 Mar-24 Mar-24 +39% +39% +33% +23% +19% +18% +16% +10% Prem. Vs.
Current
![Slide 14 Slide 14](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s14g1.jpg)
Comparable Companies
Sum-of-the-Parts (“SOTP”) Source:Company Filings, Everest Management Plan and FactSet as of March 28, 2024. Note: Reflects Everest Capitalization. Net debt and NCI as of December 31, 2023 as per public filings. (1)$996mm of net debt and
$204mm of NCI reflects consolidated Everest net debt and NCI less Kilimanjaro standalone balances. (2) Everest share of Kilimanjaro net debt and NCI, $1,597mm and $6mm respectively, apportioned pro rata with ownership. (3) Implied share price
rounded to nearest $0.05. A B A B + – + – + (1) (2) (3)
![Slide 15 Slide 15](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s15g1.jpg)
Everest Ex-Kilimanjaro Comparable
Companies Benchmarking Everest Ex-Kili. TEV (1) + – + + + Source:Everest Management Plan and FactSet as of March 28, 2024. Corporate costs valued on a blended basis.
![Slide 16 Slide 16](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s16g1.jpg)
Comparable Companies: OSP &
EE&R Segments EE&R OSP(1) Source:Everest Management Plan and FactSet as of March 28, 2024. Note:Reflects Everest Capitalization. Dollars in billions unless otherwise noted. Atlanta Braves and MSG Sports considered in comparable companies but
omitted from benchmarking due to non-meaningful multiple. Everest segment EBITDA includes corporate cost allocation based on revenue contribution. Reflects enterprise value including noncontrolling interest of Kilimanjaro stake and financials fully
consolidated for Kilimanjaro. (2) (2) (2) (3) (3)
![Slide 17 Slide 17](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s17g1.jpg)
Representation SD&T
Source:Everest Management Plan and FactSet as of March 28, 2024. Note:Reflects Everest Capitalization. Dollars in billions unless otherwise noted. Everest segment EBITDA includes corporate cost allocation based on revenue contribution. Reflects
enterprise value including noncontrolling interest of Kilimanjaro stake and financials fully consolidated for Kilimanjaro. Comparable Companies: Representation & SD&T Segments (1) (1) (2) (2)
![Slide 18 Slide 18](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s18g1.jpg)
Reference Only: Overview Of Selected
Transactions: Representation Segment Source:Wall street research and news articles. EV / EBITDA Multiple Acquiror EQT CAA Artemis (Pinault Family) Date Jul-22 Sep-21 Sep-23 Valuation ($mm) Not Disclosed $750 $7,000 Acquired Stake Not Disclosed 100%
Majority Includes Change of Control Premium “ ” “On the private side of the representation business, WME, CAA just bought ICM for 15x. UTA was a very small company, just got an investment at 15x” - Ari Emanuel, March 2023
![Slide 19 Slide 19](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s19g1.jpg)
Reference Only: WWE Multiple Over
Time Prior To UFC Combination Source:FactSet. Note:2-yr Average and Median multiples over the 2021 and 2022 calendar year periods prior to announcement of strategic alternatives. Reflects FactSet Enterprise Value / NTM EBITDA. EV / NTM EBITDA
Multiple 15.0x 2-yr Avg.: 15.6x 2-yr Median: 15.4x
![Slide 20 Slide 20](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s20g1.jpg)
Reference Only: Market Implied
Everest ex-Kilimanjaro Valuation Source:FactSet. Note:Reflects FactSet Enterprise Value / NTM EBITDA. (1)Reflects OSP valued at WWE EV / NTM EBITDA multiple. EV / NTM EBITDA Multiple 8.0x Avg.: 8.7x Median: 8.6x Avg.: 14.6x Median: 15.8x
Market-Implied Everest ex-OSP(1) Market-Implied Everest ex-Kili. WWE Transaction Rumored, Announced and Closed HIGHLY ILLUSTRATIVE Market-Implied Everest ex-OSP / ex-Kilimanjaro EV / EBITDA WWE EV/EBITDA Kilimanjaro EV/EBITDA 15.0x
![Slide 21 Slide 21](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s21g1.jpg)
Components Of SOTP DCF-Implied Share
Price DCF Components Low - High Reflects range of values per EGH Class A Share Source: Company filings, Everest Management Plan, Everest Tax Asset Projection and FactSet as of March 28, 2024. Note: Illustrative DCF valuation date of December 31,
2023. Reflects Everest net debt of $4,112mm as of December 31, 2023 as per company filings. Reflects Everest Capitalization. (1) Figures rounded to the nearest $0.05. Everest ex-Kilimanjaro $12.02 – $15.51 Kilimanjaro $14.31 – $19.31 TRA
Benefit $0.31 – $0.33 NOL Benefit $0.03 – $0.03 Value Per EGH Class A Share(1) $27.60 – $36.25 $0.93 – $1.05 Definite Life D&A Tax Benefit Value Per EGH Class A Share(1) (ex. Tax Assets) $26.30 – $34.80 A B D E C
Everest ex-Kilimanjaro unlevered free cash flows to EGH Class A shareholders 51% Kilimanjaro unlevered cash flows to EGH Class A shareholders Benefit of tax shield retained by EGH Class A shareholders under TRA with pre-IPO shareholders Benefit of
tax shield from NOLs Excludes NOLs included as TRA attribute Tax benefit to EGH Class A shareholders from ’29 - ’43 definite life D&A
![Slide 22 Slide 22](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s22g1.jpg)
Everest Ex-Kilimanjaro Discounted
Cash Flow Analysis Unlevered Free Cash Flow Detail Exit Multiple Sensitivity (Excludes Impact of Tax Assets and D&A) Source: Company filings, Everest Management Plan and Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF
valuation date of December 31, 2023. Assumes mid-year discounting. Reflects EGH net debt of $716mm and redeemable NCI of $147mm as of December 31, 2023 as per company filings. Excludes Kilimanjaro net debt. Corporate tax rate per Everest management.
(1) Reflects Everest Capitalization; options and units treated on an as-converted basis under treasury stock method. A (1)
![Slide 23 Slide 23](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s23g1.jpg)
Exit Multiple Sensitivity
Kilimanjaro Discounted Cash Flow Analysis Unlevered Free Cash Flow Detail Source: Company filings and Everest Management Plan and Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes
mid-year discounting. Reflects EGH share of 51% of Kilimanjaro net debt of $1,148mm and redeemable NCI of $4mm as of December 31, 2023 as per company filings. Corporate tax rate per Everest management. (1) Reflects Everest capitalization; options
and units treated on an as-converted basis under treasury stock method. B (1)
![Slide 24 Slide 24](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s24g1.jpg)
Definite Life D&A Discounted
Cash Flow Analysis Finite Life Depreciation and Amortization Schedule Net Cash Flow Benefit to EGH Present Value to EGH Source:Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes
mid-year discounting. Corporate tax rate per Everest management. (1)Reflects Everest Capitalization; options and units treated on an as-converted basis under treasury stock method. Applicable to Everest ex-Kilimanjaro only; reflects finite life
D&A outside of projection period, incremental to run-rate D&A of the business C
![Slide 25 Slide 25](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s25g1.jpg)
TRA Benefit Discounted Cash Flow
Analysis Cash Flow Benefit of Tax Receivable Agreement (TRAs) TRA Cash Flow Benefit to EGH Present Value to EGH Reflects tax benefits of asset step-up during IPO captured through Everest’s modified Up-C structure; Class A Shareholders retain
15% of TRA tax benefits D Source:Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes mid-year discounting. (1)Reflects Everest Capitalization; options and units treated on an
as-converted basis under treasury stock method.
![Slide 26 Slide 26](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s26g1.jpg)
NOL Discounted Cash Flow Analysis
Cash Flow Benefit of NOLs NOL Cash Flow Benefit to EGH Present Value of NOL Cash Flow Benefit to EGH E Source:Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes mid-year
discounting. Corporate tax rate per Everest management. (1)Reflects Everest Capitalization; options and units treated on an as-converted basis under treasury stock method.
![Slide 27 Slide 27](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s27g1.jpg)
Everest ex-Kilimanjaro WACC Analysis
Source: Company filings, Bloomberg and FactSet as of March 28, 2024. Note: Dollars in billions. (1) Reflects 2Y Adjusted Weekly Betas per Bloomberg. (2) Unlevered Beta = (Levered Beta/(1+((1-Tax Rate)*Debt/Equity)). Tax rate assumed to be 24.0% for
peers. Owned Sports Properties Events, Experiences & Rights Representation Sports Data & Technology
![Slide 28 Slide 28](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s28g1.jpg)
Everest (ex-Kilimanjaro) WACC
Analysis (10) Source: Company filings, Duff and Phelps, Bloomberg and FactSet as of March 28, 2024. Note: Dollars in millions. Reflects Everest Capitalization and net debt as of December, 31 2023 per public filings. Kilimanjaro equity capitalization
per Everest management and debt capitalization reflect public filings. (1) Reflects 2Y Adjusted Weekly Betas per Bloomberg. (2) Unlevered Beta = (Levered Beta/(1+((1-Tax Rate)*Debt/Equity)). Tax rate assumed to be 24.0% for peers and 26.0% for
Everest and Kilimanjaro per Everest management. (3) U.S. 20-year treasury yield spot rate. (4) Unlevered Beta of comparable companies. (5) Represents levering of the unlevered Beta at Everest’s target capital structure. Levered Beta =
(unlevered Beta * (1+ (1-tax rate)* debt / equity)). (6) Historical Market Risk Premium per Duff & Phelps. (7) Premium for companies with market value between $7.5 to $14.8bn per Duff & Phelps. (8) Cost of Equity as per CAPM. (9) WACC =
((Debt/Capitalization * (Cost of Debt * (1 - Tax Rate))) + (Equity / Capitalization * Levered Cost of Equity). (10) Prior to Kilimanjaro transaction reflects WWE trading.
![Slide 29 Slide 29](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s29g1.jpg)
Kilimanjaro WACC Analysis (10)
Source: Company filings, Duff and Phelps, Bloomberg and FactSet as of March 28, 2024. Note: Dollars in millions. Reflects Everest Capitalization and net debt as of December, 31 2023 per public filings. Kilimanjaro equity capitalization per Everest
management and debt capitalization reflect public filings. (1) Reflects 2Y Adjusted Weekly Betas per Bloomberg. (2) Unlevered Beta = (Levered Beta/(1+((1-Tax Rate)*Debt/Equity)). Tax rate assumed to be 24.0% for peers and 26.0% for Everest and
Kilimanjaro per Everest management. (3) U.S. 20-year treasury yield spot rate. (4) Unlevered Beta of comparable companies. (5) Represents levering of the unlevered Beta at Everest’s target capital structure. Levered Beta = (unlevered Beta *
(1+ (1-tax rate)* debt / equity)). (6) Historical Market Risk Premium per Duff & Phelps. (7) Premium for companies with market value between $7.5 to $14.8bn per Duff & Phelps. (8) Cost of Equity as per CAPM. (9) WACC = ((Debt/Capitalization
* (Cost of Debt * (1 - Tax Rate))) + (Equity / Capitalization * Levered Cost of Equity). (10) Prior to Kilimanjaro transaction reflects WWE trading.
![Slide 30 Slide 30](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s30g1.jpg)
Appendix
![Slide 31 Slide 31](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s31g1.jpg)
Premia in Select Precedent Minority
“Squeeze Out” Transactions Source:Company filings and FactSet. Note: Dollars in billions. Percent of equity owned reflects voting control. Cash, minority “squeeze out” transactions with U.S. targets and over $100mm in equity
consideration over the last ~10 years with offers from only single acquiror. Excludes transactions in real-estate, energy, financial institutions and oil and gas industries (n=15). Reflects unaffected date of first bid. Reflects 30 trading days.
Reflects unaffected date of final bid. Initial bid reflects THL Partners bid as of January 26, 2024. On June 24, 2013, Crown Media filed an amendment to its Schedule 13D disclosing it was evaluating a “short-form merger to eliminate the
minority stockholders”. Final price reflects 151% premium to share price on June 24, 2013. (6) (2) (4) (3) (3) Selected Precedent Minority “Squeeze Out” Transactions(1) (5) (5) (5)
![Slide 32 Slide 32](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s32g1.jpg)
Everest Ex-Kilimanjaro Normalized
Terminal Year Calculation Source:Everest Management Plan. Note: Dollars in millions. Revenue EBITDA Capex NWC Winter Olympics Summer Olympics
![Slide 33 Slide 33](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_4s33g1.jpg)
Everest Cash Flows Including 51% Of
Kilimanjaro & Tax Assets Unlevered Free Cash Flow Detail Source:Company filings and Everest Management Plan. Note:Dollars in millions.
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s1g1.jpg)
March 30, 2024 Discussion Materials
Project Everest Exhibit (C)(5)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of
its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would
create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis
described above should not be taken to be Centerview’s view of the actual value of Everest. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed
publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the
Board of Directors of Everest (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person.
Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation
does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s3g1.jpg)
Feedback Delivered To Sierra Following
Initial Proposal Centerview communicated the following messages regarding proposed $24.50 acquisition price October 25, 2023 Everest stock price of $17.72 does not reflect “unaffected” reference price Everest stock traded below $18 for
only three days during this period and reflects all-time low Share price declines during this time period driven by rumored Saudi PIF investment in Professional Fighters League as Kilimanjaro close date approached More than five months have passed
and several positive operational announcements have been made subsequently (e.g., $5bn WWE Raw / Netflix deal) Therefore, premiums referenced in Sierra proposal not relevant 5-Day VWAP not an appropriate time period to measure reference price
– 30, 60 and 90 days are standard practice $24.50 proposal is effectively a “take under” (5% discount to current Everest trading price of $25.73) Only one other precedent identified with initial bid below market Rationale for
$31.50 counterproposal: More consistent with analyst price targets ~22% premium to current stock price ~27-28% premium to current 30, 60 and 90-day VWAPs (~$24-24.50) Source:Company filings, FactSet and Sierra Proposal dated March 29, 2024 (the
“Sierra 3/29 Proposal”).
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s4g1.jpg)
Summary Terms of Revised Sierra Offer
Source:Sierra Proposal dated March 30, 2024 (the “Sierra 3/30 Proposal”) and Everest Management Plan per Everest Management (the “Everest Management Plan”). (1)Everest enterprise value and multiple reflect full consolidation
of Kilimanjaro. Includes $4.0bn from Sierra Flagship funds and $1.1bn in a newly raised SPV. Reflects Everest Management Plan metrics less 49% of Kilimanjaro metrics. Net debt of $2,593 and NCI of $210 based on pro rata split of Kili capitalization.
Price Proposal to acquire 100% of the outstanding equity interests of Everest, other than any equity interests that are rolled over by Sierra or management Purchase price of $25.75 per share in cash Implied equity value of $12bn Implied enterprise
value of $24bn, representing 13.8x ’24E EBITDA(1) Including only 51% of Kili, implied enterprise value of $15bn representing 13.0x ’24E EBITDA(3) Financing Committed financing of $15bn, including: $5.1bn equity from Sierra(2) $500mm
preferred equity from MSD and Mubadala $8.5bn debt financing from JP Morgan, Goldman Sachs, Morgan Stanley and Bank of America Process Considerations No further confirmatory diligence required; investment committee approval required Offer to expire
by its terms at 11:59 PM PT, Sunday March 31, 2024 Closing Conditions Draft merger agreement includes a specific performance provision for Sierra to close and no financing condition Parties must use reasonable best efforts to obtain required
approvals (other than gaming approvals) Shareholder Approvals Sierra agrees to deliver a written consent approving the transaction within 12 hours post-signing Not subject to a “majority of the minority” vote
![Slide 5 Slide 5](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s5g1.jpg)
Illustrative Analysis At Various Prices
Source:Company filings, Sierra 3/30 Proposal, Sierra 3/29 Proposal, Everest Management Plan, Bloomberg and FactSet as of March 28, 2024. Note:Dollars in millions except per share amounts. Reflects Everest net debt of $4,112mm and $215mm of NCI as of
December 31, 2023 as per company filings. Capitalization as of March 8, 2024 as provided by Everest Management: 301.1mm shares outstanding, 150.9mm OpCo and Manager Units not held by Everest Manager or EGH, 10.6mm RSUs, 15.2mm Profit Units with a
WAEP of $21.96, 4.1mm options with a WAEP of $25.49 and 0.8mm Phantom Units with a WAEP of $3.89 (the “Everest Capitalization”). (1)Reflects Everest Management Plan metrics less 49% of Kilimanjaro metrics. Net debt of $2,593 and NCI of
$210 based on pro rata split of Kili capitalization. Initial Sierra Offer (3/29/24) Revised Sierra Offer (3/30/24)
![Slide 6 Slide 6](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s6g1.jpg)
Premia in Select Precedent Minority
“Squeeze Out” Transactions Source:Company filings and FactSet. Note: Dollars in billions. Percent of equity owned reflects voting control. Cash, minority “squeeze out” transactions with U.S. targets and over $100mm in equity
consideration over the last ~10 years with offers from only single acquiror. Excludes transactions in real-estate, energy, financial institutions and oil and gas industries (n=15). Reflects unaffected date of first bid. Reflects 30 trading days.
Reflects unaffected date of final bid. Initial bid reflects THL Partners bid as of January 26, 2024. On June 24, 2013, Crown Media filed an amendment to its Schedule 13D disclosing it was evaluating a “short-form merger to eliminate the
minority stockholders”. Final price reflects 151% premium to share price on June 24, 2013. (6) (2) (4) (3) (3) Selected Precedent Minority “Squeeze Out” Transactions(1) (5) (5) (5)
![Slide 7 Slide 7](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s7g1.jpg)
Precedent Bumps in Select Minority
“Squeeze Out” Transactions 2nd Bid 3rd Bid 4th Bid 5th Bid % Increase in Bid % Increase Final Bid vs. Initial Bid n=15 n=14 n=12 n=7 n=15 25th Percentile Median 75th Percentile Maximum Source: Company filings. Note: All cash, minority
“squeeze out” transactions with U.S. targets and over $100mm in equity consideration over the last ~10 years with offers from only single acquiror. Excludes transactions in real-estate, energy, financial institutions and oil and gas
industries (n=15). +45%
![Slide 8 Slide 8](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s8g1.jpg)
Sources And Uses Of Revised Sierra
Transaction Reflects offer price of $25.75 Source:Sierra 3/30 Proposal and Everest Management Plan. Note:Dollars in millions. Represents rollover commitments at signing. Includes equity purchase consideration for all outstanding Class A common stock
and vested equity awards through 2025. Also includes equity purchase consideration for all Everest Operating Company partnership units not subject to deferral by 2025, plus 50% of holdback units. Reflects principal amount of existing First Lien Term
Loan under 2014 Credit Facilities plus other notes payable. Based on Everest Management Plan 2024E EBITDA. Does not take into account any potential add backs or rolled existing leverage. Sources Uses (1) (2) (3) Reflects 58% Debt / Capitalization
and 5.0x Net Leverage(4)
![Slide 9 Slide 9](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_5s9g1.jpg)
Sierra Revised Offer Price In Context
Selected Everest Share Price Reference Points Offer Price: $25.75 (Discount) / Premium to Offer Price ($24.50): (26.2%) (8.0%) +5.1% +5.4% +6.0% +7.3% +17.2% +19.1% +29.2% +43.4% +45.7% 30-Day 60-Day 90-Day IPO Price 90-Day 60-Day 30-Day 5-Day Low
Since IPO VWAP as of Today VWAP as of 10/25/23(2) Source:Sierra 3/30 Proposal, and FactSet as of March 28, 2024. Reflects estimated cost basis for Kilimanjaro investors per Everest Management. Reflects VWAPs based on the closing price prior to
Everest announcement of strategic alternatives review. Referenced in Sierra offer letter Kili Merger Cost Basis (1) Current +0.1% High Since IPO
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s1g1.jpg)
March 30, 2024 Discussion Materials
Project Everest Exhibit (C)(6)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of
its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would
create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis
described above should not be taken to be Centerview’s view of the actual value of Everest. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed
publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the
Board of Directors of Everest (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person.
Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation
does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s3g1.jpg)
Summary Terms of Offer Source:Sierra
Proposal dated March 29, 2024 (the “Sierra 3/29 Proposal”) and Everest Management Plan per Everest Management (the “Everest Management Plan”). (1)Everest enterprise value and multiple reflect full consolidation of
Kilimanjaro. Includes $3.5bn from Sierra Flagship funds and $1.1bn in a newly raised SPV. Reflects Everest Management Plan metrics less 49% of Kilimanjaro metrics. Net debt of $2,593 and NCI of $210 based on pro rata split of Kili capitalization.
Price Proposal to acquire 100% of the outstanding equity interests of Everest, other than any equity interests that are rolled over by Sierra or management Purchase price of $24.50 per share in cash Implied equity value of $11.4bn Implied enterprise
value of $23.1bn, representing 13.5x ’24E EBITDA(1) Including only 51% of Kili, implied enterprise value of $14.2bn representing 12.5x ’24E EBITDA(3) Financing Committed financing of $14bn, including: $4.6bn equity from Sierra(2) $500mm
preferred equity from MSD and Mubadala $8.5bn debt financing from JP Morgan, Goldman Sachs, Morgan Stanley and Bank of America Process Considerations No further confirmatory diligence required; investment committee approval required Offer to expire
by its terms at 11:59 PM PT, Sunday March 31, 2024 Closing Conditions Draft merger agreement includes a specific performance provision for Sierra to close and no financing condition Parties must use reasonable best efforts to obtain required
approvals (other than gaming approvals) Shareholder Approvals Sierra agrees to deliver a written consent approving the transaction within 12 hours post-signing Not subject to a “majority of the minority” vote
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s4g1.jpg)
Illustrative Analysis At Various Prices
Source:Company filings, Sierra 3/29 Proposal, Everest Management Plan, Bloomberg and FactSet as of March 28, 2024. Note:Dollars in millions except per share amounts. Reflects Everest net debt of $4,112mm and $215mm of NCI as of December 31, 2023 as
per company filings. Capitalization as of March 8, 2024 as provided by Everest Management: 301.1mm shares outstanding, 150.9mm OpCo and Manager Units not held by Everest Manager or EGH, 10.6mm RSUs, 15.2mm Profit Units with a WAEP of $21.96, 4.1mm
options with a WAEP of $25.49 and 0.8mm Phantom Units with a WAEP of $3.89 (the “Everest Capitalization”). (1)Reflects Everest Management Plan metrics less 49% of Kilimanjaro metrics. Net debt of $2,593 and NCI of $210 based on pro rata
split of Kili capitalization. Sierra Offer (3/29/24)
![Slide 5 Slide 5](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s5g1.jpg)
Premia in Select Precedent Minority
“Squeeze Out” Transactions Source:Company filings and FactSet. Note: Dollars in billions. Percent of equity owned reflects voting control. Cash, minority “squeeze out” transactions with U.S. targets and over $100mm in equity
consideration over the last ~10 years with offers from only single acquiror. Excludes transactions in real-estate, energy, financial institutions and oil and gas industries (n=15). Reflects unaffected date of first bid. Reflects 30 trading days.
Reflects unaffected date of final bid. Initial bid reflects THL Partners bid as of January 26, 2024. On June 24, 2013, Crown Media filed an amendment to its Schedule 13D disclosing it was evaluating a “short-form merger to eliminate the
minority stockholders”. Final price reflects 151% premium to share price on June 24, 2013. (6) (2) (4) (3) (3) Selected Precedent Minority “Squeeze Out” Transactions(1) (5) (5) (5)
![Slide 6 Slide 6](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s6g1.jpg)
Precedent Bumps in Select Minority
“Squeeze Out” Transactions 2nd Bid 3rd Bid 4th Bid 5th Bid % Increase in Bid % Increase Final Bid vs. Initial Bid n=15 n=14 n=12 n=7 n=15 25th Percentile Median 75th Percentile Maximum Source: Company filings. Note: All cash, minority
“squeeze out” transactions with U.S. targets and over $100mm in equity consideration over the last ~10 years with offers from only single acquiror. Excludes transactions in real-estate, energy, financial institutions and oil and gas
industries (n=15). +45%
![Slide 7 Slide 7](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s7g1.jpg)
Sources And Uses Of Proposed Sierra
Transaction Reflects offer price of $24.50 Source:Sierra 3/29 Proposal and Everest Management Plan. Note:Dollars in millions. Represents rollover commitments at signing. Includes equity purchase consideration for all outstanding Class A common stock
and vested equity awards through 2025. Also includes equity purchase consideration for all Endeavor Operating Company partnership units not subject to deferral by 2025, plus 50% of holdback units. Reflects principal amount of existing First Lien
Term Loan under 2014 Credit Facilities plus other notes payable. Based on Everest Management Plan 2024E EBITDA. Does not take into account any potential add backs or rolled existing leverage. Sources Uses (1) (2) (3) Reflects 61% Debt /
Capitalization and 5.0x Net Leverage(4)
![Slide 8 Slide 8](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_6s8g1.jpg)
Sierra Offer Price In Context Selected
Everest Share Price Reference Points Offer Price: $24.50 (Discount) / Premium to Offer Price ($24.50): (29.8%) (12.5%) +0.0% +0.2% +0.9% +2.1% +11.5% +13.3% +22.9% +36.4% +38.7% 30-Day 60-Day 90-Day IPO Price 90-Day 60-Day 30-Day 5-Day Low Since IPO
VWAP as of Today VWAP as of 10/25/23(2) Source:Sierra 3/29 Proposal, and FactSet as of March 28, 2024. Reflects estimated cost basis for Kilimanjaro investors per Everest Management. Reflects VWAPs based on the closing price prior to Everest
announcement of strategic alternatives review. Referenced in Sierra offer letter Kili Merger Cost Basis (1) Current (4.8%) High Since IPO
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_7s1g1.jpg)
March 31, 2024 Discussion Materials
Project Everest Exhibit (C)(7)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_7s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of
its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would
create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis
described above should not be taken to be Centerview’s view of the actual value of Everest. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed
publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the
Board of Directors of Everest (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person.
Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation
does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_7s3g1.jpg)
Observations On Sierra DCF Approach
Source:Sierra Proposal dated 3/30 and Everest Management Plan. Note:DCF as provided by Sierra. Sierra DCF Approach Observations UFCF terminal multiple is of limited comparability Terminal value implies ~6x normalized EBITDA Derivation of exit
multiple unclear Complexity in estimating cash flows for public investors Exit multiple implies a 1.5% PGR Terminal year normalization (ex. Olympics) does not account for the Company’s expectation to renew the contract Unclear treatment of
Everest’s tax assets (e.g., D&A tax shield, TRA benefit, NOL balance) Assumes Everest operates as a C-corp No visibility on Kilimanjaro valuation assumptions A B C D A B C D E E E F F
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_7s4g1.jpg)
Distribution Of Trading Volume By
Deciles Trading Volume Since IPO(1) 93.2 81.8 149.5 247.3 233.7 266.4 107.7 Shares Traded (mm) Trading Volume LTM Shares Traded (mm) Source:FactSet as of March 28, 2024. Note:Reflects trading of Class A common shares only. (1)Reflects since April
29, 2021. 37.6 171.9 51.5 32.5 35.6 166.5 179.7 216.8 83.9 – – 1% of volume has been below $18.00 since IPO (13.7mm shares) 1% of volume has been below $18.00 in the LTM period (10.8mm shares)
![Slide 1 Slide 1](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s1g1.jpg)
Confidential Discussion Materials
Project Everest April 2, 2024 Exhibit (C)(8)
![Slide 2 Slide 2](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s2g1.jpg)
Disclaimer This presentation has been
prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Everest Group Holdings Inc. (“Everest”) in connection with its evaluation of a proposed transaction
involving Everest and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Everest and publicly available information, and portions of the information contained herein may be based upon
statements, estimates and forecasts provided by Everest. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any
independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Everest or any other entity, or concerning the solvency or fair value of Everest or any other entity. With respect to financial forecasts,
Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Everest as to the future financial performance of Everest, and at your direction
Centerview has relied upon such forecasts, as provided by Everest’s management, with respect to Everest. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The
information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or
otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of
its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would
create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis
described above should not be taken to be Centerview’s view of the actual value of Everest. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed
publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the
Board of Directors of Everest (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Everest or any other person.
Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation
does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
![Slide 3 Slide 3](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s3g1.jpg)
Series of reverse triangular mergers
that are intended to preserve existing modified Up-C structure Summary Of Selected Transaction Terms Source:Draft Merger Agreement dated April 2, 2024. Price Proposal to acquire 100% of the outstanding equity interests of Everest, other than any
equity interests that are rolled over by Sierra or management Excludes certain equity awards, holdback units and EOC partnership units Excludes Class X and Class Y common shares of Everest, which are non-economic shares that will be automatically
canceled Purchase price of $27.50 per Class A share headline value plus additional value per share of at least $0.24 (representing $0.06 of dividends per quarter for at least four quarters regardless of timing to close) Financing Fully committed
financing including $8.5bn debt financing from JP Morgan, Goldman Sachs, Morgan Stanley and Bank of America and equity financing from Sierra funds Regulatory Conditions Receipt of required antitrust and FDI regulatory approvals Merger agreement
includes closing condition to Sierra’s benefit tied to receipt of gaming approvals (which condition is deemed satisfied at either 8.5 or 11.5 months from signing) and does not include a financing condition Shareholder Approvals Sierra agrees
to deliver a written consent approving the transaction within 12 hours post-signing Not subject to a “majority of the minority” vote Timing Outside Date of 12 months after signing Transaction Structure Termination Fees Everest
Termination Fee of: $289mm (2.25% of deal equity value) Sierra Termination Fee of: $706mm (5.5% of deal equity value)
![Slide 4 Slide 4](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s4g1.jpg)
Evolution of Sierra Price Proposals
Source:Company filings, Sierra 4/1 Proposal, Sierra 3/31 Proposal, Sierra 3/30 Proposal, Sierra 3/29 Proposal, Everest Management Plan per Everest Management (the “Everest Management Plan”), Bloomberg and FactSet as of March 28, 2024.
Note:Dollars in millions except per share amounts. Reflects Everest net debt of $4,112mm and $215mm of NCI as of December 31, 2023 as per company filings. Capitalization as of March 8, 2024 as provided by Everest Management: 301.1mm shares
outstanding, 150.9mm OpCo and Manager Units not held by Everest Manager or EGH, 10.6mm RSUs, 15.2mm Profit Units with a WAEP of $21.96, 4.1mm options with a WAEP of $25.49 and 0.8mm Phantom Units with a WAEP of $3.89 (the “Everest
Capitalization”). Reflects Everest Management Plan metrics less 49% of Kilimanjaro metrics. Net debt of $2,593 and NCI of $210 based on pro rata split of Kili capitalization. Reflects $27.50 per share headline value and additional value per
share of at least $0.24 (representing $0.06 per share of dividends per quarter for at least four quarters regardless of timing to close). Initial Sierra Offer (3/29/24) Revised Sierra Offer (3/30/24) Revised Sierra Offer (3/31/24) Revised Sierra
Offer (4/1/24) Final Sierra Offer (4/1/24) (2)
![Slide 5 Slide 5](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s5g1.jpg)
Everest Valuation Analysis Low:
10/23/2023 High: 04/25/2023 Everest ex-Kili. WACC: 10.50% - 12.00% 51% Kilimanjaro WACC: 9.50% - 11.00% Everest Tax Assets WACC: 10.50% - 12.00% Source:Company filings, analyst research, Everest Management Plan, Everest Tax Asset Projection per
Everest management (the “Everest Tax Asset Projection”), Sierra 4/1 Proposal and FactSet as of March 28, 2024. Note:Reflects Everest net debt of $4,112mm and $215mm of NCI as of December 31, 2023 as per company filings; adjusted for
Kilimanjaro net debt as applicable, based on subsequent analysis (see following pages for detail). Capitalization as of March 8, 2024 as provided by Everest Management: 301.1mm shares outstanding, 150.9mm OpCo and Manager Units not held by Everest
Manager or EGH, 10.6mm RSUs, 15.2mm Profit Units with a WAEP of $21.96, 4.1mm options with a WAEP of $25.49 and 0.8mm Phantom Units with a WAEP of $3.89 (the “Everest Capitalization”). Reflects closing prices for the 52-week period
ending as of March 28, 2024. Reflects $27.50 per share headline value and additional value per share of at least $0.24 (representing $0.06 per share of dividends per quarter for at least four quarters regardless of timing to close). $27.74 Sierra
Offer Value per Share(2) $34.82 $26.32 Excl. Tax Assets Everest ex-Kili. ($523mm ’24E EBITDA): 9.5x – 12.0x 51% of Kilimanjaro ($611mm ’24E EBITDA): 13.5x – 18.0x High Low (Aug-23) (Jan-24) Discounted Cash Flow Analysis
Including Value of Tax Assets (Finite Life D&A, TRA & NOLs) Selected Public Comparable Companies Analysis (1) For reference only
![Slide 6 Slide 6](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s6g1.jpg)
Appendix
![Slide 7 Slide 7](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s7g1.jpg)
C E G F Sep-21 – Everest
announces acquisition of OpenBet for $1.2bn Nov-21 – Everest sells controlling stake in content business for $850mm May-22 – Everest reports first quarter 2022 earnings Apr-23 – Everest announces intention to combine UFC and WWE
assets Aug-23 – PFL(1) receives a reportedly $100mm minority investment from SRJ (Saudi sovereign wealth fund backed sports investment vehicle) Sep-23 – Kilimanjaro begins trading as UFC / WWE transaction closes Oct-23 – Everest
announces consideration of strategic alternatives Everest Stock Price Performance Since IPO Source:Company filings and FactSet as of March 28, 2024. Note: Starting share price reflects first trading day closing share price. S&P500 performance
indexed to Everest share price as of April 29, 2021. Professional Fighters League. Kilimanjaro indexed to Everest closing share price as of September 12, 2023. $25.20 +25% $25.73 +2% Everest S&P500 Share Price Performance Since IPO Public Market
Events A B C D E F B D G Russian invasion of Ukraine (Feb), Fed hikes interest rates 25bps (Mar) A Kili. $18.57 (16%) 52W H: $25.88 52W L: $17.67 (2)
![Slide 8 Slide 8](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s8g1.jpg)
Selected Everest Analyst Price Targets
Source:Analyst research as of March 28, 2024. TD Cowen also includes valuation by DCF (11x EV/EBITDA terminal value). Aug-23 Feb-24 Feb-24 Feb-24 Mar-24 Feb-24 Jan-24 Average PT: $31 (+22% to Current Price) Current Price: $25.73 Buy Hold Sell (1)
+40% +28% +24% +24% +21% +17% +13% +9% Feb-24 Focus on SOTP amongst brokers reflect the diversity of assets under Everest umbrella Prem. vs. Current
![Slide 9 Slide 9](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s9g1.jpg)
Comparable Companies Analysis
Source:Company Filings, Everest Management Plan and FactSet as of March 28, 2024. Note: Reflects Everest Capitalization. Net debt and NCI as of December 31, 2023 as per public filings. (1)$996mm of net debt and $204mm of NCI reflects consolidated
Everest net debt and NCI less Kilimanjaro standalone balances. (2) Everest share of Kilimanjaro net debt and NCI, $1,597mm and $6mm respectively, apportioned pro rata with ownership. A B A B + – + – + (1) (2)
![Slide 10 Slide 10](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s10g1.jpg)
Everest Ex-Kilimanjaro Comparable
Companies Analysis (Cont’d) Everest Ex-Kili. TEV (1) + – + + + Source:Everest Management Plan and FactSet as of March 28, 2024. Corporate costs valued on a blended basis.
![Slide 11 Slide 11](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s11g1.jpg)
Comparable Companies: OSP &
EE&R Segments EE&R OSP(1) Source:Everest Management Plan and FactSet as of March 28, 2024. Note:Reflects Everest Capitalization. Dollars in billions unless otherwise noted. Atlanta Braves and MSG Sports considered in comparable companies but
omitted from benchmarking due to non-meaningful multiple. Everest segment EBITDA includes corporate cost allocation based on revenue contribution. Reflects enterprise value including noncontrolling interest of Kilimanjaro stake and financials fully
consolidated for Kilimanjaro. (2) (2) (2) (3) (3)
![Slide 12 Slide 12](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s12g1.jpg)
Representation SD&T
Source:Everest Management Plan and FactSet as of March 28, 2024. Note:Reflects Everest Capitalization. Dollars in billions unless otherwise noted. Everest segment EBITDA includes corporate cost allocation based on revenue contribution. Reflects
enterprise value including noncontrolling interest of Kilimanjaro stake and financials fully consolidated for Kilimanjaro. Comparable Companies: Representation & SD&T Segments (1) (1) (2) (2)
![Slide 13 Slide 13](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s13g1.jpg)
Components Of DCF-Implied Share
Price DCF Components Low - High Reflects range of values per EGH Class A Share Source: Company filings, Everest Management Plan, Everest Tax Asset Projection and FactSet as of March 28, 2024. Note: Illustrative DCF valuation date of December 31,
2023. Reflects Everest net debt of $4,112mm as of December 31, 2023 as per company filings. Reflects Everest Capitalization. Everest ex-Kilimanjaro $12.02 – $15.51 Kilimanjaro $14.31 – $19.31 TRA Benefit $0.31 – $0.33 NOL Benefit
$0.03 – $0.03 Value Per EGH Class A Share $27.58 – $36.23 $0.93 – $1.05 Definite Life D&A Tax Benefit Value Per EGH Class A Share (ex. Tax Assets) $26.32 – $34.82 A B D E C Everest ex-Kilimanjaro unlevered free cash flows
to EGH Class A shareholders 51% Kilimanjaro unlevered cash flows to EGH Class A shareholders Benefit of tax shield retained by EGH Class A shareholders under TRA with pre-IPO shareholders Benefit of tax shield from NOLs Excludes NOLs included as TRA
attribute Tax benefit to EGH Class A shareholders from ’29 - ’43 definite life D&A
![Slide 14 Slide 14](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s14g1.jpg)
Everest Ex-Kilimanjaro Discounted
Cash Flow Analysis Unlevered Free Cash Flow Detail Exit Multiple Sensitivity (Excludes Impact of Tax Assets and D&A) Source: Company filings, Everest Management Plan and Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF
valuation date of December 31, 2023. Assumes mid-year discounting. Reflects EGH net debt of $716mm and redeemable NCI of $147mm as of December 31, 2023 as per company filings. Excludes Kilimanjaro net debt. Corporate tax rate per Everest management.
(1) Reflects Everest Capitalization; options and units treated on an as-converted basis under treasury stock method. A (1)
![Slide 15 Slide 15](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s15g1.jpg)
Exit Multiple Sensitivity
Kilimanjaro Discounted Cash Flow Analysis Unlevered Free Cash Flow Detail Source: Company filings and Everest Management Plan and Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes
mid-year discounting. Reflects EGH share of 51% of Kilimanjaro net debt of $1,148mm and redeemable NCI of $4mm as of December 31, 2023 as per company filings. Corporate tax rate per Everest management. (1) Reflects Everest capitalization; options
and units treated on an as-converted basis under treasury stock method. B (1)
![Slide 16 Slide 16](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s16g1.jpg)
Definite Life D&A Discounted
Cash Flow Analysis Finite Life Depreciation and Amortization Schedule Net Cash Flow Benefit to EGH Present Value to EGH Source:Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes
mid-year discounting. Corporate tax rate per Everest management. (1)Reflects Everest Capitalization; options and units treated on an as-converted basis under treasury stock method. Applicable to Everest ex-Kilimanjaro only; reflects finite life
D&A outside of projection period, incremental to run-rate D&A of the business C
![Slide 17 Slide 17](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s17g1.jpg)
TRA Benefit Discounted Cash Flow
Analysis Cash Flow Benefit of Tax Receivable Agreement (TRAs) TRA Cash Flow Benefit to EGH Present Value to EGH Reflects tax benefits of asset step-up during IPO captured through Everest’s modified Up-C structure; Class A Shareholders retain
15% of TRA tax benefits D Source:Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes mid-year discounting. (1)Reflects Everest Capitalization; options and units treated on an
as-converted basis under treasury stock method.
![Slide 18 Slide 18](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s18g1.jpg)
NOL Discounted Cash Flow Analysis
Cash Flow Benefit of NOLs NOL Cash Flow Benefit to EGH Present Value of NOL Cash Flow Benefit to EGH E Source:Everest Tax Asset Projection. Note: Dollars in millions. Illustrative DCF valuation date of December 31, 2023. Assumes mid-year
discounting. Corporate tax rate per Everest management. (1)Reflects Everest Capitalization; options and units treated on an as-converted basis under treasury stock method.
![Slide 19 Slide 19](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s19g1.jpg)
Everest ex-Kilimanjaro WACC Analysis
Source: Company filings, Bloomberg and FactSet as of March 28, 2024. Note: Dollars in billions. (1) Reflects 2Y Adjusted Weekly Betas per Bloomberg. (2) Unlevered Beta = (Levered Beta/(1+((1-Tax Rate)*Debt/Equity)). Tax rate assumed to be 24.0% for
peers. Owned Sports Properties Events, Experiences & Rights Representation Sports Data & Technology
![Slide 20 Slide 20](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s20g1.jpg)
Everest (ex-Kilimanjaro) WACC
Analysis (10) Source: Company filings, Duff and Phelps, Bloomberg and FactSet as of March 28, 2024. Note: Dollars in millions. Reflects Everest Capitalization and net debt as of December, 31 2023 per public filings. Kilimanjaro equity capitalization
per Everest management and debt capitalization reflect public filings. (1) Reflects 2Y Adjusted Weekly Betas per Bloomberg. (2) Unlevered Beta = (Levered Beta/(1+((1-Tax Rate)*Debt/Equity)). Tax rate assumed to be 24.0% for peers and 26.0% for
Everest and Kilimanjaro per Everest management. (3) U.S. 20-year treasury yield spot rate. (4) Unlevered Beta of comparable companies. (5) Represents levering of the unlevered Beta at Everest’s target capital structure. Levered Beta =
(unlevered Beta * (1+ (1-tax rate)* debt / equity)). (6) Historical Market Risk Premium per Duff & Phelps. (7) Premium for companies with market value between $7.5 to $14.8bn per Duff & Phelps. (8) Cost of Equity as per CAPM. (9) WACC =
((Debt/Capitalization * (Cost of Debt * (1 - Tax Rate))) + (Equity / Capitalization * Levered Cost of Equity). (10) Prior to Kilimanjaro transaction reflects WWE trading.
![Slide 21 Slide 21](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s21g1.jpg)
Kilimanjaro WACC Analysis (10)
Source: Company filings, Duff and Phelps, Bloomberg and FactSet as of March 28, 2024. Note: Dollars in millions. Reflects Everest Capitalization and net debt as of December, 31 2023 per public filings. Kilimanjaro equity capitalization per Everest
management and debt capitalization reflect public filings. (1) Reflects 2Y Adjusted Weekly Betas per Bloomberg. (2) Unlevered Beta = (Levered Beta/(1+((1-Tax Rate)*Debt/Equity)). Tax rate assumed to be 24.0% for peers and 26.0% for Everest and
Kilimanjaro per Everest management. (3) U.S. 20-year treasury yield spot rate. (4) Unlevered Beta of comparable companies. (5) Represents levering of the unlevered Beta at Everest’s target capital structure. Levered Beta = (unlevered Beta *
(1+ (1-tax rate)* debt / equity)). (6) Historical Market Risk Premium per Duff & Phelps. (7) Premium for companies with market value between $7.5 to $14.8bn per Duff & Phelps. (8) Cost of Equity as per CAPM. (9) WACC = ((Debt/Capitalization
* (Cost of Debt * (1 - Tax Rate))) + (Equity / Capitalization * Levered Cost of Equity). (10) Prior to Kilimanjaro transaction reflects WWE trading.
![Slide 22 Slide 22](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s22g1.jpg)
Everest Ex-Kilimanjaro Normalized
Terminal Year Calculation Source:Everest Management Plan. Note: Dollars in millions. Revenue EBITDA Capex NWC Winter Olympics Summer Olympics
![Slide 23 Slide 23](https://www.sec.gov/Archives/edgar/data/1766363/000119312524193438/g847171exc_8s23g1.jpg)
Overview Of Everest Segments Revenue
EBITDA Source:Everest Management Plan. Note:Dollars in billions.
0001766363SC 13E-3SC 13E3EX-FILING FEESSC 14ASC 14AtruetrueEndeavor Group Holdings, Inc. previously paid $1,070,092.69 upon the filing of its preliminary information statement on Schedule 14A on August 2, 2024 in connection with the transaction reported hereby.In accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the proposed maximum aggregate value of the transaction estimated solely for the purposes of calculating the filing fee was calculated, as of June 30, 2024, based on the sum of: (a) the product of 214,625,751 shares of Company Class A Common Stock and the per share merger consideration of $27.50; (b) the product of 26,923,186 units of OpCo Membership Interest and $27.50 (which is the difference between the per unit merger consideration of $27.50 and the amount to be distributed with respect to each OpCo Membership Interest of $0.00); (c) the product of 724,465 units of OpCo Profits Unit Interest and $6.27 (which is the per unit merger consideration of $27.50 less the amount to be distributed with respect to each OpCo Membership Interest of $0.00 and less the weighted average strike price of $21.23 per unit); (d) the product of 21,051,715 units of Manager Membership Interest and the per unit merger consideration of $27.50; (e) the product of 39,720 shares of Company Class A Common Stock underlying outstanding Vested Company RSUs and Vested Company PSUs and the per share merger consideration of $27.50; (f) the product of 3,655,667 shares of Company Class A Common Stock underlying outstanding Vested Company Options and $2.39 (which is the difference between the per share merger consideration of $27.50 and the weighted average exercise price of $25.11 per share); and (g) the product of 510,645 units of Phantom Units and $27.50 (which is the difference between the per unit merger consideration of $27.50 and the Deferred Phantom Unit Payment of $0.00 per unit).Aggregate number of securities to which transaction applies: As of the close of business on June 30, 2024, the maximum number of securities of the Company to which this transaction applies is estimated to be 267,531,149, which consists of: (a) 214,625,751 issued and outstanding shares of Class A common stock, par value $0.00001 per shares, of the Company (“Company Class A Common Stock”) entitled to receive the per share merger consideration of $27.50 (which excludes any Rollover Shares and Excluded Shares); (b) 26,923,186 issued and outstanding common units (“OpCo Membership Interests”) of Endeavor Operating Company, LLC (“OpCo”) entitled to receive the per unit merger consideration of $27.50 minus any amounts that are distributed with respect to an OpCo Membership Interest in respect of the distributions contemplated by the restructuring transactions (“OpCo Merger Consideration”) (which excludes any Rollover Units and Excluded OpCo Membership Interests); (c) 724,465 issued and outstanding profits units (“OpCo Profits Unit”) of OpCo entitled to receive the per unit merger consideration of the OpCo Merger Consideration less the “strike price” of such OpCo Profits Unit (which excludes any Rollover Units); (d) 21,051,715 issued and outstanding common units (“Manager Membership Interest”) of Endeavor Manager, LLC (“Manager”) entitled to receive the per unit merger consideration of $27.50 (which excludes any Excluded Manager Membership Interests); (e) 39,720 shares of Company Class A Common Stock underlying outstanding Vested Company RSUs and Vested Company PSUs, which are entitled to receive the per share merger consideration of $27.50; (f) 3,655,667 shares of Company Class A Common Stock underlying outstanding Vested Company Options to purchase shares of Company Class A Common Stock, which are entitled to receive the per share merger consideration of $27.50 minus the applicable exercise price; and (g) 510,645 issued and outstanding phantom units of the Company (“Phantom Unit”) entitled to receive the per unit merger consideration of $27.50 less any Deferred Phantom Unit Payment. As of the close of business on June 30, 2024, there were 8,494,871 shares of Company Class A Common Stock underlying outstanding Unvested Company RSUs, 1,002,156 shares of Company Class A Common Stock underlying outstanding Unvested Company PSUs and 399,508 shares of Company Class A Common Stock underlying outstanding Unvested Company Options. Pursuant to the Merger Agreement, the treatment of each Unvested Company RSU will be determined by the Executive Committee prior to the Effective Time or, if not determined prior to the Effective Time, by the administrator of the Company Stock Plan as soon as reasonably practicable following the Effective Time. As of the close of business on June 30, 2024, the Company estimated that the Unvested Company RSUs will not vest prior to the Effective Time and has excluded the Unvested Company RSUs from the maximum number of shares of the Company’s securities to which this transaction applies in the table above. Pursuant to the Merger Agreement, each Unvested Company PSU will, at the Effective Time, automatically be cancelled and no payment will be made with respect thereto, therefore the Company has excluded the Unvested Company PSUs from the maximum number of shares of the Company’s securities to which this transaction applies in the table above. Pursuant to the Merger Agreement, each Unvested Company Option has an exercise price in excess of $27.50 and will therefore be cancelled for no consideration in accordance with the Merger Agreement, therefore the Company has excluded the Unvested Company Options from the maximum number of shares of the Company’s securities to which this transaction applies in the table above.In accordance with Section 14(g) of the Exchange Act and Rule 0-11 under the Exchange Act, the filing fee was determined by multiplying the sum calculated in the preceding sentence by 0.00014760. 0001766363 2024-08-02 2024-08-02 0001766363 1 2024-08-02 2024-08-02 0001766363 2 2024-08-02 2024-08-02 0001766363 1 2024-08-02 2024-08-02 iso4217:USD xbrli:pure
Exhibit 107
CALCULATION OF FILING FEE TABLES
(Form Type)
Endeavor Group Holdings, Inc.
Endeavor Operating Company, LLC
Endeavor Manager, LLC
Endeavor Executive Holdco, LLC
Endeavor Executive II Holdco, LLC
Endeavor Executive PIU Holdco, LLC
Silver Lake West Holdco, L.P.
Silver Lake West Holdco II, L.P.
Silver Lake West Voteco, L.L.C.
Wildcat EGH Holdco, L.P.
Wildcat OpCo Holdco, L.P.
Wildcat PubCo Merger Sub, Inc.
Wildcat OpCo Merger Sub, L.L.C.
Wildcat Manager Merger Sub L.L.C.
SLP Wildcat Aggregator GP, L.L.C.
Silver Lake Partners VI, L.P.
Silver Lake Partners VII, L.P.
Silver Lake Technology Associates VI, L.P.
Silver Lake Technology Associates VII, L.P.
SLTA VI (GP), L.L.C.
SLTA VII (GP), L.L.C.
Silver Lake Group, L.L.C.
Ariel Emanuel
Patrick Whitesell
(Exact Name of Registrant and Name of Person Filing Statement)
Table 1: Transaction Valuation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proposed Maximum Aggregate Value of Transaction |
|
|
Fee Rate |
|
|
Amount of Filing Fee |
|
Fees to be Paid |
|
$ |
7,249,950,502 |
(1)(2) |
|
|
0.00014760 |
|
|
$ |
1,070,092.69 |
(3) |
Fees Previously Paid |
|
$ |
— |
|
|
|
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Transaction Valuation |
|
$ |
7,249,950,502 |
|
|
|
|
|
|
|
|
|
Total Fees Due for Filing |
|
|
|
|
|
|
|
|
|
$ |
1,070,092.69 |
|
Total Fees Previously Paid |
|
|
|
|
|
|
|
|
|
$ |
— |
|
Total Fee Offsets |
|
|
|
|
|
|
|
|
|
$ |
1,070,092.69 |
(4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Fee Due |
|
|
|
|
|
|
|
|
|
$ |
— |
|
Capitalized terms used below but not defined herein shall have the meanings assigned to such terms in the accompanying preliminary information statement filed by Endeavor Group Holdings, Inc. (the “Company”) of which this Exhibit 107 is a part.
(1) |
Aggregate number of securities to which transaction applies: As of the close of business on June 30, 2024, the maximum number of securities of the Company to which this transaction applies is estimated to be 267,531,149, which consists of: |
|
(a) |
214,625,751 issued and outstanding shares of Class A common stock, par value $0.00001 per shares, of the Company (“Company Class A Common Stock”) entitled to receive the per share merger consideration of $27.50 (which excludes any Rollover Shares and Excluded Shares); |
|
(b) |
26,923,186 issued and outstanding common units (“OpCo Membership Interests”) of Endeavor Operating Company, LLC (“OpCo”) entitled to receive the per unit merger consideration of $27.50 minus any amounts that are distributed with respect to an OpCo Membership Interest in respect of the distributions contemplated by the restructuring transactions (“OpCo Merger Consideration”) (which excludes any Rollover Units and Excluded OpCo Membership Interests); |
|
(c) |
724,465 issued and outstanding profits units (“OpCo Profits Unit”) of OpCo entitled to receive the per unit merger consideration of the OpCo Merger Consideration less the “strike price” of such OpCo Profits Unit (which excludes any Rollover Units); |
|
(d) |
21,051,715 issued and outstanding common units (“Manager Membership Interest”) of Endeavor Manager, LLC (“Manager”) entitled to receive the per unit merger consideration of $27.50 (which excludes any Excluded Manager Membership Interests); |
|
(e) |
39,720 shares of Company Class A Common Stock underlying outstanding Vested Company RSUs and Vested Company PSUs, which are entitled to receive the per share merger consideration of $27.50; |
|
(f) |
3,655,667 shares of Company Class A Common Stock underlying outstanding Vested Company Options to purchase shares of Company Class A Common Stock, which are entitled to receive the per share merger consideration of $27.50 minus the applicable exercise price; and |
|
(g) |
510,645 issued and outstanding phantom units of the Company (“Phantom Unit”) entitled to receive the per unit merger consideration of $27.50 less any Deferred Phantom Unit Payment. |
As of the close of business on June 30, 2024, there were 8,494,871 shares of Company Class A Common Stock underlying outstanding Unvested Company RSUs, 1,002,156 shares of Company Class A Common Stock underlying outstanding Unvested Company PSUs and 399,508 shares of Company Class A Common Stock underlying outstanding Unvested Company Options. Pursuant to the Merger Agreement, the treatment of each Unvested Company RSU will be determined by the Executive Committee prior to the Effective Time or, if not determined prior to the Effective Time, by the administrator of the Company Stock Plan as soon as reasonably practicable following the Effective Time. As of the close of business on June 30, 2024, the Company estimated that the Unvested Company RSUs will not vest prior to the Effective Time and has excluded the Unvested Company RSUs from the maximum number of shares of the Company’s securities to which this transaction applies in the table above. Pursuant to the Merger Agreement, each Unvested Company PSU will, at the Effective Time, automatically be cancelled and no payment will be made with respect thereto, therefore the Company has excluded the Unvested Company PSUs from the maximum number of shares of the Company’s securities to which this transaction applies in the table above. Pursuant to the Merger Agreement, each Unvested Company Option has an exercise price in excess of $27.50 and will therefore be cancelled for no consideration in accordance with the Merger Agreement, therefore the Company has excluded the Unvested Company Options from the maximum number of shares of the Company’s securities to which this transaction applies in the table above.
(2) |
In accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the proposed maximum aggregate value of the transaction estimated solely for the purposes of calculating the filing fee was calculated, as of June 30, 2024, based on the sum of: |
|
(a) |
the product of 214,625,751 shares of Company Class A Common Stock and the per share merger consideration of $27.50; |
|
(b) |
the product of 26,923,186 units of OpCo Membership Interest and $27.50 (which is the difference between the per unit merger consideration of $27.50 and the amount to be distributed with respect to each OpCo Membership Interest of $0.00); |
|
(c) |
the product of 724,465 units of OpCo Profits Unit Interest and $6.27 (which is the per unit merger consideration of $27.50 less the amount to be distributed with respect to each OpCo Membership Interest of $0.00 and less the weighted average strike price of $21.23 per unit); |
|
(d) |
the product of 21,051,715 units of Manager Membership Interest and the per unit merger consideration of $27.50; |
|
(e) |
the product of 39,720 shares of Company Class A Common Stock underlying outstanding Vested Company RSUs and Vested Company PSUs and the per share merger consideration of $27.50; |
|
(f) |
the product of 3,655,667 shares of Company Class A Common Stock underlying outstanding Vested Company Options and $2.39 (which is the difference between the per share merger consideration of $27.50 and the weighted average exercise price of $25.11 per share); and |
|
(g) |
the product of 510,645 units of Phantom Units and $27.50 (which is the difference between the per unit merger consideration of $27.50 and the Deferred Phantom Unit Payment of $0.00 per unit). |
(3) |
In accordance with Section 14(g) of the Exchange Act and Rule 0-11 under the Exchange Act, the filing fee was determined by multiplying the sum calculated in the preceding sentence by 0.00014760. |
(4) |
Endeavor Group Holdings, Inc. previously paid $1,070,092.69 upon the filing of its preliminary information statement on Schedule 14A on August 2, 2024 in connection with the transaction reported hereby. |
Table 2: Fee Offset Claims and Sources
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Registrant or Filer Name |
|
|
Form or Filing Type |
|
|
File Number |
|
|
Initial Filing Date |
|
|
Filing Date |
|
|
Fee Offset Claim |
|
|
Fee Paid with Fee Offset Source |
|
Fee Offset Claims |
|
|
|
|
|
|
Schedule 14A |
|
|
|
001-40373 |
|
|
|
August 2, 2024 |
|
|
|
|
|
|
$ |
1,070,092.69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Fee Offset Sources |
|
|
Endeavor Group Holdings, Inc. |
|
|
|
Schedule 14A |
|
|
|
|
|
|
|
|
|
|
|
August 2, 2024 |
|
|
|
|
|
|
$ |
1,070,092.69 |
(4) |
v3.24.2.u1
X |
- DefinitionA unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityCentralIndexKey |
Namespace Prefix: |
dei_ |
Data Type: |
dei:centralIndexKeyItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityRegistrantName |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_FeeExhibitTp |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:feeExhibitTypeItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_SubmissionLineItems |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:stringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_SubmissnTp |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:submissionTypeItemType |
Balance Type: |
na |
Period Type: |
duration |
|
v3.24.2.u1
Offerings - Offering: 1
|
Aug. 02, 2024
USD ($)
|
Offering: |
|
|
Fee Previously Paid |
false
|
|
Transaction Valuation |
$ 7,249,950,502
|
[1],[2] |
Fee Rate |
0.01476%
|
|
Amount of Registration Fee |
$ 1,070,092.69
|
[3] |
Offering Note |
(1) |
Aggregate number of securities to which transaction applies: As of the close of business on June 30, 2024, the maximum number of securities of the Company to which this transaction applies is estimated to be 267,531,149, which consists of: |
(2) |
In accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the proposed maximum aggregate value of the transaction estimated solely for the purposes of calculating the filing fee was calculated, as of June 30, 2024, based on the sum of: |
(3) |
In accordance with Section 14(g) of the Exchange Act and Rule 0-11 under the Exchange Act, the filing fee was determined by multiplying the sum calculated in the preceding sentence by 0.00014760. |
(4) |
Endeavor Group Holdings, Inc. previously paid $1,070,092.69 upon the filing of its preliminary information statement on Schedule 14A on August 2, 2024 in connection with the transaction reported hereby. |
|
|
|
|
X |
- DefinitionTotal amount of registration fee (amount due after offsets).
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_FeeAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative1TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe rate per dollar of fees that public companies and other issuers pay to register their securities with the Commission.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_FeeRate |
Namespace Prefix: |
ffd_ |
Data Type: |
dtr-types:percentItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_OfferingNote |
Namespace Prefix: |
ffd_ |
Data Type: |
dtr-types:textBlockItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_OfferingTable |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:stringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_PrevslyPdFlg |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_TxValtn |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative100TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- Details
Name: |
ffd_OfferingAxis=1 |
Namespace Prefix: |
|
Data Type: |
na |
Balance Type: |
|
Period Type: |
|
|
v3.24.2.u1
X |
- DefinitionThe initial filing date of the earlier registration statement with which the earlier (offsetting) fee was paid for a claimed offset. If the offset fee was paid with an amendment, do not provide the amendment date under this element; instead, provide the date of the initial filing (i.e. the "parent" filing) .
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection b
+ Details
Name: |
ffd_OffsetClmInitlFilgDt |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:dateItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe amount of offsetting fees being claimed.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection b
+ Details
Name: |
ffd_OffsetClmdAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative1TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_OffsetClmdInd |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe fee prevoiusly paid from which an offset is being derived.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection b
+ Details
Name: |
ffd_OffsetPrrFeeAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative1TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe EDGAR File Number of the earlier registration statement with which the earlier (offsetting) fee was paid. If the offset filing for the offset has a Securities Act File Number and an Investment Company Act File Number, the Securities Act File Number should be used.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection b
+ Details
Name: |
ffd_OffsetPrrFileNb |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:fileNumberItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe name of the registrant that filed the earlier registration statement with which the earlier (offsetting) fee was paid.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection b
+ Details
Name: |
ffd_OffsetPrrFilerNm |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:filerNameItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe filing date of the earlier registration statement with which the earlier (offsetting) fee was paid in an offset.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 457 -Subsection b
+ Details
Name: |
ffd_OffsetSrcFilgDt |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:dateItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_OffsetTable |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:stringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- References
+ Details
Name: |
ffd_Rule011a2OffsetFlg |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- Details
Name: |
ffd_OffsetAxis=1 |
Namespace Prefix: |
|
Data Type: |
na |
Balance Type: |
|
Period Type: |
|
|
X |
- Details
Name: |
ffd_OffsetAxis=2 |
Namespace Prefix: |
|
Data Type: |
na |
Balance Type: |
|
Period Type: |
|
|
v3.24.2.u1
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_FeesSummaryLineItems |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:stringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_NetFeeAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
xbrli:monetaryItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_TtlFeeAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative1TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_TtlOffsetAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative1TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_TtlPrevslyPdAmt |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative1TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230
+ Details
Name: |
ffd_TtlTxValtn |
Namespace Prefix: |
ffd_ |
Data Type: |
ffd:nonNegative100TMonetary2ItemType |
Balance Type: |
na |
Period Type: |
duration |
|
Endeavor (NYSE:EDR)
過去 株価チャート
から 8 2024 まで 9 2024
Endeavor (NYSE:EDR)
過去 株価チャート
から 9 2023 まで 9 2024