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OPTION AWARD AGREEMENT

Option Agreement

OPTION AWARD AGREEMENT | Document Parties: Orbitz Worldwide, Inc | Travelport Inc You are currently viewing:
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Orbitz Worldwide, Inc | Travelport Inc

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Title: OPTION AWARD AGREEMENT
Governing Law: Illinois     Date: 11/14/2007
Industry: Recreational Activities     Sector: Services

OPTION AWARD AGREEMENT, Parties: orbitz worldwide  inc , travelport inc
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EXHIBIT 10.15

 

OPTION AWARD AGREEMENT

 

THIS OPTION AWARD AGREEMENT (“ Agreement ”) is made as of July 18, 2007 by and between TDS Investor (Cayman) L.P., a Cayman Islands limited partnership (the “ Partnership ”), Orbitz Worldwide, Inc., a Delaware corporation (“ Orbitz ”), and the executive whose name is set forth on the signature page hereto (“ Executive ”).

 

RECITALS

 

Orbitz has adopted the Orbitz Worldwide, Inc. 2007 Equity and Incentive Plan (the “ Plan ”), a copy of which is attached hereto as Exhibit A.

 

Orbitz was a wholly owned direct or indirect subsidiary of the Partnership prior to an initial public offering (the “ Offering ”) of Shares (as defined below).

 

Prior to the Offering, the Partnership granted the right to receive from the Partnership Class A-2 Interests in the Partnership (each, a “ Class A-2 Interest ”) with a hypothetical capital contribution equal to, on the grant date, $1 per Class A-2 Interest (such rights, the “ Partnership Restricted Equity Units ”), in each case subject to the terms of that certain Management Equity Award Agreement dated as of October 13, 2006 (the “ Partnership Award Agreement ”). As a result of the Offering, in accordance with Section 6(c) of the TDS Investor (Cayman) L.P. Second Amended and Restated 2006 Plan and Section 6.4 of the Partnership Award Agreement, and in connection with Executive’s employment by Orbitz or one of its Subsidiaries (collectively, the “ Company ”), the Partnership, Orbitz and Executive desire that certain Partnership Restricted Equity Units be modified as provided for herein, including that:

 

(i) Partnership Restricted Equity Units that are vested, as of the date of the Offering, will remain unchanged;

 

(ii) Partnership Restricted Equity Units that are unvested, as of the date of the Offering, will be assumed by the Company and modified to provide that such Partnership Restricted Equity Units (following such assumption, the “ Orbitz Restricted Stock Units ”) will each carry the right to receive from the Company, on the terms and conditions described in that Restricted Stock Unit Award Agreement between the parties hereof dated as of the date hereof, shares of common stock, par value $0.01 of the Company (each a “ Share ”), and the number of Orbitz Restricted Stock Units will be adjusted to reflect the relative value of a Class A-2 Interest compared to a Share, as of the date of the Offering; and

 

(iii) the number of Options (as defined below) specified herein will be granted to Executive in full settlement of any increased value in the Partnership Restricted Equity Units which may have been lost in connection with the Offering.

 

NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises set forth in this Agreement, and for other good and valuable consideration, the receipt

 



 

and sufficiency of which are hereby acknowledged, the parties to this Agreement, intending to be legally bound, agree as follows:

 

SECTION 1

 

DEFINITIONS

 

1.1.          Definitions . Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Plan. In addition to the terms defined in the Plan, the terms below shall have the following respective meanings:

 

Agreement ” has the meaning specified in the Preamble .

 

Board ” means the board of directors of Orbitz (or, if applicable, any committee of the Board).

 

Cause ” shall have the meaning assigned such term in any employment agreement entered into between the Company and Executive, provided that if no such employment agreement exists or such term is not defined, then “ Cause ” shall mean (A) Executive’s failure substantially to perform Executive’s duties to the Company (other than as a result of total or partial incapacity due to Disability) for a period of 10 days following receipt of written notice from the Company by Executive of such failure; provided that it is understood that this clause (A) shall not apply if the Company terminates Executive’s employment because of dissatisfaction with actions taken by Executive in the good faith performance of Executive’s duties to the Company, (B) theft or embezzlement of property of the Company or dishonesty in the performance of Executive’s duties to the Company, (C) an act or acts on Executive’s part constituting (x) a felony under the laws of the United States or any state thereof or (y) a crime involving moral turpitude, (D) Executive’s willful malfeasance or willful misconduct in connection with Executive’s duties or any act or omission which is materially injurious to the financial condition or business reputation of the Company or its affiliates, or (E) Executive’s breach of the provisions of any agreed-upon non-compete, non-solicitation or confidentiality provisions agreed to with the Company, including pursuant to this Agreement and pursuant to any employment agreement.

 

Class A-2 Interest ” has the meaning specified in the Recitals .

 

Company ” has the meaning specified in the Recitals .

 

[“ Constructive Termination ” shall have the meaning assigned such term in any employment agreement entered into between the Company and Executive, provided that if no such employment agreement exists or such term is not defined, then “Constructive Termination” shall mean (A) any material reduction in Executive’s base salary or target bonus (excluding any change in value of equity incentives or a reduction affecting substantially all similarly situated executives); (B) the failure of the Company to pay compensation or benefits when due, in each case which is not cured within 30 days following the Company’s receipt of written notice from Executive describing the event constituting a Constructive Termination; (C) the primary business

 

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office of the Company being relocated by more than 50 miles; or (D) a material and sustained diminution in Executive’s duties and responsibilities as of the date of the Offering.](1)

 

Disability ” shall have the meaning assigned such term in any employment agreement entered into between the Company and Executive, provided that if no such employment agreement exists or such term is not defined, then “ Disability ” shall mean Executive shall have become physically or mentally incapacitated and is therefore unable for a period of nine (9) consecutive months or for an aggregate of twelve (12) months in any eighteen (18) consecutive month period to perform Executive’s duties under Executive’s employment. Any question as to the existence of the Disability of Executive as to which Executive and the Company cannot agree shall be determined in writing by a qualified independent physician mutually acceptable to Executive and the Company. If Executive and the Company cannot agree as to a qualified independent physician, each shall appoint such a physician and those two physicians shall select a third who shall make such determination in writing. The determination of Disability made in writing to the Company and Executive shall be final and conclusive for all purposes of this Agreement and any other agreement between the Company and Executive that incorporates the definition of “Disability”.

 

Executive ” has the meaning specified in the Preamble .

 

Grant Date ” means the date hereof.

 

Offering ” has the meaning specified in the Recitals .

 

Option ” has the meaning specified in Section 2 below.

 

Orbitz ” has the meaning specified in the Preamble .

 

Orbitz Restricted Stock Units ” has the meaning specified in the Recitals .

 

Partnership ” has the meaning specified in the Preamble .

 

Partnership Restricted Equity Units ” has the meaning specified in the Recitals .

 

Share ” has the meaning specified in the Recitals .

 

SECTION 2

 

GRANT OF OPTION

 

2.1.          Grant of Option . Subject to the terms and conditions hereof, Orbitz hereby grants to Executive, as of the Grant Date, a stock option (the “ Option ”) to purchase up to the number of Shares specified on the signature page hereto. The Shares shall be purchasable from

 


(1) Only include for CEO.

 

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time to time during the term of the Option specified in Section 3.1 at the exercise price per Share specified on the signature page hereto (the “ Exercise Price ”).

 

SECTION 3

 

TERM OF OPTION AND CONDITIONS OF EXERCISE

 

3.1.          Term . Unless the Option is earlier terminated pursuant to this Agreement or the Plan, the term of the Option shall commence on the Grant Date and terminate upon the tenth anniversary of the Grant Date.

 

3.2.          Vesting Schedule .

 

(a)           Subject to the provisions of this Agreement and the Plan and Executive’s continued employment with the Company on the applicable vesting dates, 5.555% of the Option (rounded up to the next whole share) shall become vested and exercisable on August 25, 2007, an additional 8.586% of the Option (rounded up to the next whole share) shall become vested and exercisable on each subsequent November 25, February 25, May 25 and August 25 thereafter through February 25, 2010, and the balance of the Option shall become vested and exercisable on May 25, 2010 [(each, a “ Scheduled Vesting Date ”)](2).

 

(b)           Notwithstanding any other provision of this Agreement, the Option shall become fully vested and exercisable as of a Change in Control.

 

(c)           Notwithstanding any other provision of this Agreement, upon any termination of Executive’s employment with the Company by the Company without Cause, any portion of the Option which would have become exercisable had Executive remained employed by the Company through one year from the date of such termination shall become immediately vested and exercisable as of the date of such termination.

 

(d)           [Notwithstanding any other provision of this Agreement, upon any termination of Executive’s employment with the Company (A) as a result of death or Disability or (B) by Executive as a result of a Constructive Termination, any portion of the Option which would have become exercisable on:

 

(i)            the next four Scheduled Vesting Dates shall become immediately vested and exercisable as of the date of such termination if such termination occurs between August 26 and November 25 (inclusive);

 

(ii)           the next three Scheduled Vesting Dates shall become immediately vested and exercisable as of the date of such termination if such termination occurs between November 26 and February 25 (inclusive);

 


(2) Only include for CEO.

 

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(iii)          the next two Scheduled Vesting Dates shall become immediately vested and exercisable as of the date of such termination if such termination occurs between February 26 and May 25 (inclusive); and

 

(iv)          on the next Scheduled Vesting Date shall become immediately vested and exercisable as of the date of such termination if such termination occurs between May 26 and August 25 (inclusive).](3)

 

(e)           The Board may determine at any time before the Option expires that the Option or any portion thereof shall become vested and exercisable at any time.

 

3.3.          Termination of Employment . Subject to Sections 3.2(b), (c) [and (d)](4), in the event that Executive ceases to be employed by the Company, that portion of the Option that is not or does not become then exercisable shall immediately terminate and that portion of the Option that is or becomes exercisable at the time of Executive’s termination of employment shall terminate one year from the date of termination, provided that if the termination of employment occurs on or following a Change in Control, that portion of the Option that is or becomes exercisable at the time of Executive’s termination of employment shall terminate three years from the date of such termination.

 

3.4.          Limited Transferability . The Option shall be neither transferable nor assignable by Executive other than by will or the laws of inheritance following Executive’s death and may be exercised, during Executive’s lifetime, only by Executive. However, Executive may designate one or more persons as the beneficiary or beneficiaries of the Option, and the Option shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon Executive’s death while holding the Option. Such beneficiary or beneficiaries shall take the transferred Option subject to all the terms and conditions of this Agreement, including (without limitation) the limited time period during which the Option may, pursuant to Section 3.3, be exercised following Executive’s death.

 

3.5.          Exercise . The Option shall be exercised by a written notice delivered to the General Counsel of the Company at the Company’s principal executive offices in accordance with Section 5.14 below, specifying the portion of the Option to be exercised and accompanied by payment therefor. The Exercise Price for any Shares purchased pursuant to the exercise of the Option and the applicable withholding taxes due thereon shall be paid in full upon such exercise in cash, by wire transfer or certified check or by such other method as may be approved by the Board. In no event may the Option be exercised for any fractional Shares.

 

3.6.          Forfeiture . Notwithstanding anything herein to the contrary, if the Board determines in good faith that Executive has (i) willfully engaged in misconduct which is materially and demonstrably injurious to the Company; (ii) willfully and knowingly participated in the preparation or release of false or materially misleading financial statements relating to the

 


(3) One year forward vesting for CEO in the case of involuntary termination, death or Disability or constructive termination.

 

(4) Include for CEO only.

 

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Company’s operations and financial condition; (iii) committed a willful act of fraud, embezzlement or misappropriation of any money or properties of the Company or breach of fiduciary duty against the Company that has a material adverse effect on the Company; or (iv) breached any noncompetition or confidentiality covenants for the benefit of the Company applicable to Executive (including, without limitation, the covenants set forth in Section 4 below) during Executive’s employment or following termination of Executive’s employment, then:

 

(a)           any portion of the Option then held by Executive shall be automatically forfeited,

 

(b)           any Shares acquired pursuant to any exercise of the Option within five (5) years prior to the date of Board determination of (i), (ii), or (iii) above or within three (3) years prior to the date of Board determination of (iv) above and then held by Executive shall be subject to repurchase by the Company at the lower of (x) the fair market value (as determined by the Board in good faith) of such Shares as of the time of repurchase or (y) the Exercise Price paid for such Shares upon exercise of the Option, and

 

(c)           in the event Executive has sold or otherwise disposed of Shares acquired pursuant to any exercise of the Option within five (5) years prior to the date of Board determination of (i), (ii), or (iii) above or within three (3) years prior to the date of Board determination of (iv) above, Executive shall pay to the Company the greater of (x) any proceeds received from such sale or other disposition, less the Exercise Price paid for the applicable Shares, or (y) the fair market value (as determined by the Board in good faith) of such Shares as of the date of Board determination of misconduct or breach.

 

SECTION 4

 

NON-COMPETITION AND CONFIDENTIALITY

 

4.1.          Non-Competition .

 

(a)           From the date hereof while employed by the Company and for a [      -year](5) period following the date Executive ceases to be employed by the Company (the “ Restricted Period ”), irrespective of the cause, manner or time of any termination, Executive shall not use his or her status with the Company or any of its affiliates to obtain loans, goods or services from another organization on terms that would not be available to him or her in the absence of his or her relationship to the Company or any of its affiliates.

 

(b)           During the Restricted Period, Executive shall not make any statements or perform any acts intended to or which may have the effect of advancing the interest of any Competitors of the Company or any of its affiliates or in any way injuring the interests of the Company or any of its affiliates and the Company and its affiliates shall not make or authorize any person to make any statement that would in any way injure the personal or business reputation or interests of Executive; provided, however, that, subject to Section 4.2, nothing

 


(5) Two years for CEO; 1 year for SVP.

 

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herein shall preclude the Company and its affiliates or Executive from giving truthful testimony under oath in response to a subpoena or other lawful process or truthful answers in response to questions from a government investigation; provided , further, however, that nothing herein shall prohibit the Company and its affiliates from disclosing the fact of any termination of Executive’s employment or the circumstances for such a termination. For purposes of this Section 4.1(b), the term “ Competitor ” means any enterprise or business that is engaged in, or has plans to engage in, at any time during the Restricted Period, any activity that competes with the businesses conducted during or at the termination of Executive’s employment, or then proposed to be conducted, by the Company and its affiliates in a manner that is or would be material in relation to the businesses of the Company or the prospects for the businesses of the Company (in each case, within 100 miles of any geographical area where the Company or its affiliates manufactures, produces, sells, leases, rents, licenses or otherwise provides its products or services). During the Restricted Period, Executive, without prior express written approval by the Board, shall not (A) engage in, or directly or indirectly (whether for compensation or otherwise) manage, operate, or control, or join or participate in the management, operation or control of a Competitor, in any capacity (whether as an employee, officer, director, partner, consultant, agent, advisor, or otherwis












 
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