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
2
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.
3
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.
4
(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.
5
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.
6
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
|