Activision Blizzard (ATVI)

Grant Dates and Exercise Prices Based on Employment Service Related “Business Events” Insufficient to Support Reported Measurement Date

A large number of the grants requiring measurement date corrections were made in connection with employment service related “business events” (including employment contracts for both new hires and contract renewals for existing employees).  In many instances, the Special Subcommittee determined that the lowest price was chosen from among several alternative dates, on the theory that it was permissible to use a date that was tied to a “business event,” such as the date negotiations commenced, the date of a handshake agreement, the date that an employee began working for the Company, or the date that the contract was signed by the employee.  These grants account for approximately $34.5 million, or about 52% of the total of approximately $66.7 million in additional pre-tax stock-based compensation expense recorded by the Company in the restated financial statements reported in the Company’s Amended Annual Report on Form 10-K/A for the fiscal year ended March 31, 2006.

Grant Dates and Exercise Prices Based on Employment Service Related “Business Events” Insufficient to Support Reported Measurement Date

F-17

A large number of the grants requiring measurement date corrections were made in connection with employment service related “business events” (including employment contracts for both new hires and contract renewals for existing employees).  In many instances, the Special Subcommittee determined that the lowest price was chosen from among several alternative dates, on the theory that it was permissible to use a date that was tied to a “business event,” such as the date negotiations commenced, the date of a handshake agreement, the date that an employee began working for the Company, or the date that the contract was signed by the employee.  These grants account for approximately $34.5 million, or about 52% of the total of approximately $66.7 million in additional pre-tax stock-based compensation expense related to measurement date corrections.