The old contract that has been floating around the internet is a 4 game deal over a 10 year timeline. Currently they are a year behind with regards to the original "10 year plan". I'd imagine that the 4 game deal is very similar to the music industry's "X album" deal with dead lines and penalties for missing dead lines. That contract doesn't end after ten years, it ends after the final obligation is fulfilled. I'd also imagine that the contract has been renegotiated multiple times to adjust the timelines and the penalties for missing the deadlines, especially when they had to reboot the development cycle of D2.
At this rate Bungie is Activision's ***** for at least 5 more years unless D3 fails miserably.