Avg 2016 Archives

SUMMARY TERM SHEET

The information contained in this summary term sheet is a summary only and is not meant to be a substitute for the more detailed description and information contained in this Offer to Purchase, the related Letter of Transmittal and other related materials. You are urged to read carefully the Offer to Purchase, the Letter of Transmittal and other related materials in their entirety. Parent and Purchaser have included cross-references in this summary term sheet to other sections of the Offer to Purchase where you will find more complete descriptions of the topics mentioned below. The information concerning AVG contained herein and elsewhere in the Offer to Purchase has been provided to Parent and Purchaser by AVG or has been taken from or is based upon publicly available documents or records of AVG on file with the SEC or other public sources at the time of the Offer. Parent and Purchaser have not independently verified the accuracy and completeness of such information. Parent and Purchaser have no knowledge that would indicate that any statements contained herein relating to AVG provided to Parent and Purchaser or taken from or based upon such documents and records filed with the SEC are untrue or incomplete in any material respect.

Who is offering to buy my Shares?

Avast Software B.V., or Purchaser, a direct wholly owned subsidiary of Avast Holding B.V., or Parent, is offering to purchase for cash all outstanding Shares. Purchaser is a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized under the laws of The Netherlands.

See the &#;Introduction&#; and Section 8 &#; &#;Certain Information Concerning Parent and Purchaser.&#;

Unless the context indicates otherwise, in this Offer to Purchase, we use the terms &#;us,&#; &#;we&#; and &#;our&#; to refer to Purchaser and, where appropriate, Parent. We use the term &#;Parent&#; to refer to Avast Holding B.V. alone, the term &#;Purchaser&#; to refer to Avast Software B.V. alone and the terms &#;AVG&#; and the &#;Company&#; to refer to AVG Technologies N.V.

What are the classes and amounts of securities sought in the Offer?

We are offering to purchase all outstanding Shares at a purchase price of $ per Share, in cash, without interest and less applicable withholding taxes or other taxes, upon the terms and subject to the conditions set forth in this Offer to Purchase and the Letter of Transmittal.

See the &#;Introduction&#; to this Offer to Purchase and Section 1 &#; &#;Terms of the Offer.&#;

Is there an agreement governing the Offer?

Yes. Parent, Purchaser and AVG have entered into a Purchase Agreement, dated as of July 6,  The Purchase Agreement provides, among other things, for the terms and conditions of the Offer, the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable, and the Subsequent Reorganization. If the conditions to the Offer are satisfied and we consummate the Offer, we intend to effect the Subsequent Reorganization, subject to the satisfaction of certain conditions, including, among other conditions, in the case of the Asset Sale, the Dissolution and the Liquidation Distribution, the approval of AVG shareholders of such transactions and related matters contemplated by the Purchase Agreement at the EGM.

See Section 11 &#; &#;The Purchase Agreement; Other Agreements,&#; Section 12 &#; &#;Purpose of the Offer; Plans for AVG&#; and Section 15 &#; &#;Certain Conditions of the Offer.&#;

Why are you making the Offer?

We are making the Offer because we want to acquire the entire equity interest in AVG so that we will own and control all of AVG&#;s current business. If the Offer is consummated, we intend to cause AVG to terminate the listing of the Shares on the NYSE. As a result, AVG would cease to be publicly traded. In addition, after the consummation of the Offer we intend to cause the termination of the registration of Shares under Exchange Act as promptly as practicable and expect to take steps to cause the suspension of all of AVG&#;s reporting obligations with the SEC.

Following the Expiration Time, Purchaser intends to provide for the Subsequent Offering Period of at least 10 business days in accordance with Rule 14d under the Exchange Act and in accordance with the Purchase Agreement. The Subsequent Offering Period may be extended by Purchaser in accordance with the Purchase Agreement by the Minority Exit Offering Period of at least seven business days following the announcement that Purchaser or its designee intends to effect the Asset Sale. As promptly as practicable following the closing of the Subsequent Offering Period (which includes the Minority Exit Offering Period, if applicable), Purchaser intends to complete the Subsequent Reorganization. The Subsequent Reorganization will utilize processes available to Purchaser to ensure that (a) Purchaser becomes the owner of all of AVG&#;s business operations from and after the consummation of the Subsequent Reorganization and (b) any AVG shareholders who do not tender their Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable) are offered or receive the same consideration for their Shares as those shareholders who tendered their Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable), without interest and less applicable withholding taxes (including Dutch dividend withholding tax) or other taxes. As a result of the Subsequent Reorganization, it is anticipated that AVG will be liquidated or become wholly owned by Purchaser.

See Section 12 &#; &#;Purpose of the Offer; Plans for AVG&#; of this Offer to Purchase.

How much are you offering to pay and what is the form of payment? Will I have to pay any fees or commissions?

We are offering to pay $ per Share, in cash, without interest and less applicable withholding taxes or other taxes, upon the terms and subject to the conditions set forth in the Purchase Agreement. If you are the record owner of your Shares and you tender your Shares directly to the Depositary, you will not have to pay brokerage fees, commissions or similar expenses. If you own your Shares through a broker, dealer, commercial bank, trust company or other nominee and your broker, dealer, commercial bank, trust company or other nominee

tenders your Shares on your behalf, your broker, dealer, commercial bank, trust company or nominee may charge you a fee for doing so. You should consult your broker, dealer, commercial bank, trust company or nominee to determine whether any charges will apply.

See the &#;Introduction,&#; Section 1 &#; &#;Terms of the Offer,&#; and Section 2 &#; &#;Acceptance for Payment and Payment for Shares.&#;

Will you have the financial resources to make payment?

Yes, we anticipate that we will have sufficient resources available to us. The Offer is not subject to a financing condition. We estimate that the total funds required to purchase all of the Shares pursuant to the Offer and to consummate the other transactions contemplated by the Purchase Agreement (which estimate includes, among other things, payment in respect of outstanding in-the-money options and vested and unvested restricted stock units and performance-based restricted stock units), pay related transaction fees and expenses due and payable on or prior to the consummation of the Offer, pay or refinance all Purchaser and AVG debt that is required to be paid or refinanced upon consummation of the Offer and satisfy all other payment obligations of Purchaser and AVG required to be satisfied at the closing of the Offer will be approximately $ billion. Purchaser has obtained commitments from Credit Suisse AG, Jefferies Finance LLC, UBS AG, Stamford Branch, Bank of America Merrill Lynch International Limited and Société Générale (collectively, the &#;Lenders&#;) to provide $ million in a senior secured revolving credit facility with a term of five years (the &#;Revolving Credit Facility&#;) and $1, million equivalent in senior secured term loan facilities (which will be provided as (a) a senior secured term loan facility denominated in U.S. dollars with a term of six years (the &#;Dollar Tranche Term Facility&#;) and (b) a senior secured term loan facility denominated in Euros with a term of six years, such Euro amount determined based on the spot rate of exchange on the date of allocation of commitments of the Term Loan Facilities (as defined below) in connection with primary syndication (the &#;Euro Tranche Term Facility&#; and, the Dollar Tranche Term Facility and Euro Tranche Term Facility, collectively, the &#;Term Loan Facilities,&#; and together with the Revolving Credit Facility, the &#;Debt Financing&#;). Parent and Purchaser anticipate that the Debt Financing and/or bank or other debt financings that may be entered into or issued by Purchaser in lieu of all or a portion of the Debt Financing, together with certain unrestricted cash or cash equivalents available to Purchaser (including such cash or cash equivalents of AVG that will become available to Purchaser upon the consummation of the Offer), will be sufficient to fund the purchase of all the Shares pursuant to the Offer and to pay related transaction fees and expenses due and payable on or prior to the consummation of the Offer, and pay or refinance all Purchaser and AVG debt that is required to be paid or refinanced upon consummation of the Offer, in accordance with the provisions of the Debt Financing, and satisfy all other payment obligations of Purchaser and AVG required to be satisfied upon consummation of the Offer. Credit Suisse AG (acting through such of its affiliates or branches as it deems appropriate) will act as sole and exclusive administrative agent and collateral agent in respect of the Debt Financing. Funding of the Debt Financing is subject to the satisfaction of various conditions set forth in the amended and restated commitment letter pursuant to which the Debt Financing will be provided. The documentation governing the Debt Financing has not been finalized and, accordingly, the actual terms of the Debt Financing may, subject to the prior written consent of AVG in the case of certain changes to the Debt Financing, differ from those described in this document. The parties to the documentation governing the Debt Financing are expected to include Parent, Purchaser, certain subsidiaries of Purchaser, the Lenders and/or their affiliates, and other financial institutions party thereto as lenders.

See Section 9 &#; &#;Source and Amount of Funds&#; and Section 11 &#; &#;The Purchase Agreement; Other Agreements.&#;

Is your financial condition relevant to my decision to tender my Shares pursuant to the Offer?

No. We do not think our financial condition is relevant to your decision whether to tender Shares and accept the Offer because:

However, in the Compulsory Acquisition, the Dutch Enterprise Chamber (Ondernemingskamer) of the Amsterdam Court of Appeals (Gerechtshof Amsterdam) (the &#;Dutch Court&#;) will determine the price to be paid for the Shares, which may be greater, equal to or less than the Offer Price.

See Section 5B &#; &#;Certain Dutch Tax Aspects of the Offer and Subsequent Reorganization.&#;

How long do I have to decide whether to tender my Shares pursuant to the Offer?

You will have until p.m., New York City time, on August 31, unless we extend the Offer in accordance with the Purchase Agreement or the Offer is earlier terminated. Furthermore, if you cannot deliver everything that is required in order to make a valid tender in accordance with the terms of the Offer by that time, you may still participate in the Offer by using the guaranteed delivery procedure that is described in Section 3 &#;&#;Procedures for Accepting the Offer and Tendering Shares&#; of this Offer to Purchase prior to that time.

The Purchase Agreement provides, among other things, that, subject to the terms and conditions set forth therein, Purchaser will, promptly after the Expiration Time, accept for payment all Shares validly tendered pursuant to the Offer and not properly withdrawn and, promptly after the Acceptance Time, pay for all such Shares. See Section 1 &#; &#;Terms of the Offer&#; and Section 3 &#; &#;Procedures for Accepting the Offer and Tendering Shares.&#;

Please give your broker, dealer, commercial bank, trust company or other nominee instructions with sufficient time to permit such broker, dealer, commercial bank, trust company or other nominee to tender your Shares. Beneficial owners should be aware that their broker, dealer, commercial bank, trust company or other nominee may establish its own earlier deadline for participation in the Offer. Accordingly, beneficial owners wishing to participate in the Offer should contact their broker, dealer, commercial bank, trust company or other nominee as soon as possible in order to determine the times by which such owner must take action in order to participate in the Offer.

Can the Offer be extended and under what circumstances?

Yes, subject to our rights to terminate the Purchase Agreement in accordance with its terms, we have agreed in the Purchase Agreement that we will extend the Offer under the following circumstances:

Additionally, notwithstanding anything in the Purchase Agreement to the contrary, at the Expiration Time, we may extend the Offer for up to 10 business days from the date the Marketing Period will otherwise end.

We are not, however, required to extend the Offer (a) beyond January 6, , (b) for an individual extension period of more than 10 business days or (c) at any time that we are permitted to terminate the Purchase Agreement. If we extend the Offer, such extension will extend the time that you will have to tender (or withdraw) your Shares.

See Section 1 &#; &#;Terms of the Offer.&#;

How will I be notified if the Offer is extended?

Any extension of the Offer will be followed by a public announcement of the extension no later than  a.m., New York City time, on the next business day after the day on which the Offer was otherwise scheduled to expire. Without limiting the manner in which Purchaser may choose to make any public announcement, it currently intends to make announcements regarding the Offer by issuing a press release and making any appropriate filing with the SEC.

See Section 1 &#; &#;Terms of the Offer.&#;

Will there be a subsequent offering period?

Yes, following the Expiration Time, Purchaser is obligated by the Purchase Agreement to provide for the Subsequent Offering Period of at least 10 business days in accordance with Rule 14d under the Exchange Act and in accordance with the Purchase Agreement. No withdrawal rights will apply to any Shares tendered during the Subsequent Offering Period. The Subsequent Offering Period may be extended by Purchaser in accordance with the Purchase Agreement by the Minority Exit Offering Period of at least seven business days following the announcement that Purchaser or its designee intends to effect the Asset Sale.

See Section 1 &#; &#;Terms of the Offer.&#;

What are the most significant conditions to the Offer?

The Offer is conditioned upon, among other things, the satisfaction or waiver (to the extent permitted by the Purchase Agreement and applicable law) of the following as of immediately prior to the Expiration Time: (a) the Minimum Condition, (b) the Antitrust Clearance Condition, (c) the Restraints Condition, (d) the CFIUS Clearance Condition and (e) the Termination Condition.

The Offer also is subject to a number of other conditions to the Offer set forth in Section 15 &#; &#;Certain Conditions of the Offer&#; of this Offer to Purchase. The conditions to the Offer will be in addition to, and not a limitation of, the rights of Parent and Purchaser to extend, terminate or modify the Offer in accordance with the terms and conditions of the Purchase Agreement. Subject to the applicable rules and regulations of the SEC, Purchaser expressly reserves the right at any time prior to the Expiration Time to waive, in whole or in part, any condition to the Offer and to make any change in the terms of or conditions to the Offer. However, Purchaser will not (without the prior written consent of AVG): (a) waive or change the Minimum Condition; (b) decrease the Offer Price; (c) change the form of consideration to be paid in the Offer; (d) decrease the number of Shares sought in the Offer; (e) extend or otherwise change the Expiration Time other than in accordance with the Purchase Agreement; or (f) impose additional conditions to the Offer or otherwise amend, modify or supplement any of the conditions to the Offer or terms of the Offer in a manner adverse to AVG shareholders.

See Section 15 &#; &#;Certain Conditions of the Offer.&#;

Have any AVG shareholders agreed to tender their Shares?

Yes, TA X L.P., TA Atlantic and Pacific VI L.P., TA Strategic Partners Fund II L.P., TA Strategic Partners Fund II-A L.P. and TA Investors III L.P., shareholders of AVG that together own approximately percent of the Shares, and CVP II, Inc., that owns approximately percent of the Shares (in each case based on 50,, Shares outstanding as of July 25, ), have entered into tender agreements with Purchaser, dated as of July 6, , pursuant to which each such shareholder has agreed, among other things, to tender all of the Shares held by such shareholder into the Offer. In the tender agreements, the shareholder parties have agreed to vote their Shares to, among other things, approve the Asset Sale, the Dissolution, the Liquidation Distribution, the appointment of directors designated by Purchaser and other matters relating to the transactions contemplated by the Purchase Agreement. Each tender agreement may be terminated by the applicable shareholder party upon the occurrence of certain events, including the termination of the Purchase Agreement.

See Section 11 &#; &#;The Purchase Agreement; Other Agreements &#; Tender Agreements.&#;

How do I tender my Shares?

In order for Shares to be validly tendered pursuant to the Offer, you must follow these instructions:

See Section 3 &#; &#;Procedures for Accepting the Offer and Tendering Shares.&#;

Until what time may I withdraw previously tendered Shares?

You may properly withdraw your previously tendered Shares at any time until the Expiration Time. In addition, pursuant to Section 14(d)(5) of the Exchange Act, Shares may be withdrawn at any time after September 27, , which is the 60th day after the date of the commencement of the Offer, unless prior to that date Purchaser has accepted for payment the Shares validly tendered in the Offer. There will be no withdrawal rights during the Subsequent Offering Period (which includes the Minority Exit Offering Period, if applicable); any Shares tendered will immediately be accepted and promptly paid for.

See Section 4 &#; &#;Withdrawal Rights.&#;

How do I withdraw previously tendered Shares?

To properly withdraw previously tendered Shares, you must deliver a written notice of withdrawal with the required information (as specified in this Offer to Purchase and in the related Letter of Transmittal) to the Depositary at any time at which you have the right to withdraw Shares. If you tendered Shares by giving instructions to a broker, dealer, commercial bank, trust company or other nominee, you must instruct such broker, dealer, commercial bank, trust company or other nominee to arrange for the withdrawal of your Shares and such broker, dealer, commercial bank, trust company or other nominee must effectively withdraw such Shares at any time at which you have the right to withdraw your Shares.

See Section 4 &#; &#;Withdrawal Rights.&#;

What do the AVG Supervisory Board and the AVG Management Board think of the Offer?

After due and careful discussion and consideration, including a thorough review of the Offer with their outside legal and financial advisors, the AVG Boards by unanimous vote of all directors present or represented and voting (a) approved the terms of, and the transactions contemplated by, the AVG Transaction Documents, and approved AVG&#;s entry into the AVG Transaction Documents; and (b) determined to support the Offer and to recommend that AVG shareholders accept the Offer, subject to the terms and conditions of the AVG Transaction Documents. The AVG Boards also unanimously approved (i) the Asset Sale, the subsequent Dissolution and the Liquidation Distribution and the appointment of a liquidator; (ii) the terms and conditions of the Asset Sale Agreement and the entry into the Asset Sale Agreement by AVG upon Purchaser&#;s request as set forth in the AVG Transaction Documents; and (iii) the proposed amendment of the articles of association of AVG if the Asset Sale is pursued and the proposed amendment of the articles of association of AVG and conversion of AVG into a private company with limited liability if the Asset Sale is not pursued.

The AVG Boards unanimously support the Offer and recommend that AVG shareholders accept the Offer. The AVG Boards unanimously recommend that you vote &#;for&#; each of the items that contemplate a vote of AVG shareholders at the EGM. At the EGM, AVG shareholders will be requested to vote on the Asset Sale, the Dissolution, the Liquidation Distribution, the appointment of the liquidator, the appointment of directors designated by Purchaser to the AVG Boards and other matters contemplated by the Purchase Agreement.

A more complete description of the reasons that AVG Boards approved the Offer and recommended that shareholders accept the Offer and tender their Shares pursuant to the Offer is set forth in the Solicitation/Recommendation Statement on Schedule 14D-9 of AVG that AVG is furnishing to shareholders in connection with the Offer.

If I decide not to tender, how will the Offer affect my Shares?

We anticipate that, after the consummation of the Offer, there may be so few remaining shareholders and publicly-held Shares that the Shares will no longer be eligible to be traded on the NYSE or any other securities exchange. After the consummation of the Offer, we intend to cause AVG to terminate the listing of the Shares on the NYSE. As a result, we anticipate that there will not be an active trading market for the Shares. In addition, after the consummation of the Offer we intend to cause AVG to terminate the registration of Shares under the Exchange Act as promptly as practicable and take steps to cause the suspension of its reporting obligations with the SEC. As a result, AVG would no longer be required to make filings with the SEC or otherwise comply with the rules of the SEC relating to publicly-held companies. Furthermore, the ability of &#;affiliates&#; of AVG and persons holding &#;restricted securities&#; of AVG to dispose of such securities pursuant to Rule promulgated under the Securities Act of (as amended, and together with the rules and regulations promulgated thereunder, the &#;Securities Act&#;), may be impaired or eliminated.

If a Subsequent Reorganization is consummated, it is anticipated that AVG shareholders who do not tender their Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable) will be offered or will receive the same consideration for their Shares as those shareholders who tendered their Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable), without interest and less applicable withholding taxes (including Dutch dividend withholding tax) or other taxes. However, in the Compulsory Acquisition, the Dutch Court will determine the price to be paid for the Shares, which may be greater, equal to or less than the Offer Price.

As a result of the Subsequent Reorganization, it is anticipated that AVG will be liquidated or become wholly owned by Purchaser. In addition, if the Offer and the Subsequent Reorganization are completed, another difference to you between tendering your Shares and not tendering your Shares pursuant to the Offer is that you may be paid earlier if you tender your Shares pursuant to the Offer.

The applicable withholding taxes (including Dutch dividend withholding tax) or other taxes, if any, imposed on AVG shareholders who do not tender their Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable) are likely to be different from, and greater than, the taxes imposed upon such AVG shareholders had they tendered their Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable). If in connection with the Asset Sale and the Subsequent Reorganization it is decided that AVG will be dissolved and liquidated, Dutch dividend withholding tax will (unless a shareholder qualifies for an exemption or reduction) be due at the statutory rate of 15 percent to the extent that the liquidation proceeds exceed the average paid-in capital of those Shares as recognized for purposes of Dutch dividend withholding tax purposes. As a result, the net amount received by AVG shareholders for Shares that are not tendered in the Offer is likely to be lower than the amount that they would have received had they tendered their Shares pursuant to the Offer (or during the

Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable). The amount received will depend upon each AVG shareholder&#;s individual corporate income tax or personal income tax circumstances and the amount of any required withholding or other taxes.

See the &#;Introduction&#; to this Offer to Purchase, Section 11 &#; &#;The Purchase Agreement; Other Agreements,&#; Section 12 &#; &#;Purpose of the Offer; Plans for AVG&#; and Section 13 &#; &#;Certain Effects of the Offer.&#;

What is the market value of my Shares as of a recent date?

On July 6, , the trading day before the public announcement of the terms of the Offer, the reported closing sales price of the Shares on the NYSE was $ On July 28, , the last full trading day before the commencement of the Offer, the reported closing sales price of the Shares on the NYSE was $ The Offer Price represents an approximately 33 percent premium over the July 6, closing stock price, and an approximately 1 percent premium over the July 28, stock price.

See Section 6 &#; &#;Price Range of Shares; Dividends.&#;

Will I have appraisal rights in connection with the Offer?

The AVG shareholders are not entitled under Dutch law or otherwise to appraisal rights with respect to the Offer. However, in the event that upon the Expiration Time or after the Subsequent Offering Period (which includes the Minority Exit Offering Period, if applicable), Purchaser holds 95 percent or more of the then outstanding Shares, Purchaser may acquire the remaining Shares not tendered and purchased by means of the Compulsory Acquisition. In such proceedings the Dutch Court will determine the cash price to be paid for the Shares, which may be greater than, equal to or less than the Offer Price. The non-tendering AVG shareholders do not have the right to oblige the Purchaser to buy their Shares.

See Section 17 &#; &#;Appraisal Rights.&#;

What will happen to my equity awards in the Offer?

At the Acceptance Time, each option to purchase Shares granted under the stock plans of AVG, including the Amended and Restated Option Plan and the Appendix to the Amended and Restated Option Plan &#; RSU Plan (collectively, the &#;AVG Stock Plan&#;) (such option, an &#;AVG Option&#;), whether vested or unvested, that is outstanding as of immediately prior to the Acceptance Time will be cancelled and extinguished without any further action on the part of Purchaser, AVG, or any holder of an AVG Option or any other person. To the extent that an AVG Option is vested as of the Acceptance Time (as determined in accordance with the terms of the AVG Stock Plan and the applicable award agreement) and has an exercise price per Share that is less than the Offer Price, at the Acceptance Time, such vested AVG Option will be converted into the right to receive a cash payment from Parent at the Acceptance Time (less applicable withholding taxes or other taxes) equal to the product of (a) the excess, if any, of the Offer Price over the applicable per Share exercise price of such AVG Option multiplied by (b) the number of vested Shares subject to such AVG Option. An AVG Option that is unvested as of the Acceptance Time or has an exercise price per Share that is equal to or greater than the Offer Price will be cancelled without any cash or other consideration being paid or provided therefor, except that if, as of the date of the Purchase Agreement, with respect to certain AVG Options specifically identified on the confidential disclosure schedule that AVG delivered to Parent and Purchaser concurrently with the execution of the Purchase Agreement which contain a vesting acceleration provision that can be triggered following the Acceptance Time upon a qualifying event or termination of employment, then upon the satisfaction of all of the conditions otherwise necessary for such vesting acceleration in accordance with the existing rights of the holder

of such AVG Option, Parent will, within 30 days after the date of the qualifying event or termination triggering the vesting acceleration, provide the holder of such AVG Option with a payment (less applicable withholding taxes or other taxes) equal to the product of (i) the excess, if any, of the Offer Price over the applicable per Share exercise price of such AVG Option multiplied by (ii) the number of Shares subject to such AVG Option that would have vested had the AVG Option been outstanding on the date of the event triggering the vesting acceleration right with respect to such AVG Option. No interest will be paid or accrued on any cash payable with respect to any AVG Option.

At the Acceptance Time, and without any further action on the part of Purchaser, AVG, or any holder of any outstanding performance-based restricted stock unit (an &#;AVG Performance Stock Unit&#;) or outstanding restricted stock unit (an &#;AVG Restricted Stock Unit&#;) or any other person, each AVG Performance Stock Unit or AVG Restricted Stock Unit that is vested as of the Acceptance Time (as determined in accordance with the terms of the AVG Stock Plan and the applicable award agreement) will no longer be outstanding and will automatically be cancelled and converted into the right to receive an amount in cash from Parent at the Acceptance Time (less applicable withholding taxes or other taxes) equal to the product of (a) the Offer Price multiplied by (b) the number of vested Shares subject to such AVG Performance Stock Unit or AVG Restricted Stock Unit. No interest will be paid or accrued on any cash payable with respect to any vested AVG Performance Stock Unit or AVG Restricted Stock Unit.

See Section 11 &#; &#;The Purchase Agreement; Other Agreements &#; Purchase Agreement &#; Treatment of Equity Awards.&#;

What are the material U.S. federal income tax consequences of tendering Shares for U.S. shareholders?

The receipt of cash in exchange for your Shares pursuant to the Offer (or during the Subsequent Offering Period, which includes the Minority Exit Offering Period, if applicable) (together for purposes of U.S. federal income tax discussions, the &#;Offer&#;) or the Subsequent Reorganization generally will be a taxable transaction for U.S. federal income tax purposes and may also be a taxable transaction under applicable state, local or non-U.S. income or other tax laws.

We urge you to consult your own tax advisor as to the particular tax consequences to you of the Offer and the Subsequent Reorganization.

See Section 5A &#; &#;Certain Material U.S. Federal Income Tax Consequences&#; for a more detailed discussion of the U.S. federal income tax consequences of the Offer, the Asset Sale and the Subsequent Reorganization for certain U.S. shareholders.