SECTION 1 -

The Club Deal and the Bilateral Lines have variable interest rates, plus a margin based on a
leverage ratio (consolidated net debt/consolidated EBITDA).
The Bridge to Bonds has a variable interest rate, plus a margin based on the length of time
since the first borrowing.
The Company expects to apply for a credit rating which it will disclose in the supplement to
the prospectus that will be issued in the first half of the month of June 2010 (see section 9.6 of this
prospectus). The terms of the financing agreements assume that such rating will be “solid investment
grade”. The margin level, as well as the possible inclusion of a leverage ratio requirement
(consolidated net debt/consolidated EBITDA greater than or equal to 3.00), will depend on the rating
of the Group at the time the financing agreements are executed. In any case, these financing
agreements will not contain any acceleration clause that could be triggered by future changes in the
Group’s rating (see section 3.4 of this prospectus, “Credit rating sensitivity risks”).
The pro forma financial statements included in section 10.2.1 of this prospectus were
prepared assuming financing costs that would apply at a BBB+ rating. If the Company’s rating falls
below BBB+ but remains “solid investment grade”, it would have an effect of 25 basis points on the
cost of financing.
Each of the lenders in the Club Deal, the Bridge to Bonds and each of the Bilateral Lines
would be able to accelerate the repayment of amounts due in the case of a change of control of the
Company, meaning that a person or group of persons acting in concert, as defined in Article L. 233‐10
of the French Commercial Code, acquires more than 50% of the voting rights of the Company.
2.6.7 Equity
The Group had pro forma negative equity of €1,137 million at December 31, 2008 and €1,187
million at December 31, 2009. This results from the fact that the assets contributed by the Accor
group as part of the Transaction are recorded at their historic value.
The contributions and sales which are part of the Transaction, carried out by the Accor group
in favor of the Company and resulting in net pro forma indebtedness of €303 million as of December
31, 2009 (for an estimate of the targeted net debt as of June 30, 2010, see section 2.6.6.1 of this
prospectus), do not constitute reorganization transactions falling within the scope of IFRS 3.
Regardless of the legal form of the transactions used to create the Group, these transactions
do not change the scope of the Group as defined in the combined historic financial statements. The
contributions are analyzed as an internal restructuring of the Group, which has no impact on the
Group’s historical combined financial statements, as the contributed entities were already within the
scope of the historic combined financial statements. In addition, the legal transactions involving sales
between the Accor group and the entities of the Group are not treated as acquisition transactions
from the Group’s perspective since all of the entities involved in the sales were also included within
the scope of the Group’s historic combined financial statements prior to the sale transactions.
In contrast, these sales are reflected in the Group’s financial statements as a cash transfer in
favor of the shareholder Accor, recorded as a distribution that reduces shareholders’ equity.
The negative consolidated shareholders’ equity does not affect either the Group’s refinancing
ability or the stability of its financial position (neither the Company nor its subsidiaries will have a
legal obligation to increase capital). Since the unconsolidated financial statements are not affected,
the Company’s dividend distribution capacity is also not affected.
2.6.8 Off‐balance sheet commitments
All of the Group’s off‐balance sheet commitments are guarantees given by the Group. These
generally consist of legally required guarantees given to public authorities in respect of its employee
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