Exhibit 10.16
GLOBAL HYATT
CORPORATION
RESTRICTED STOCK UNIT
AGREEMENT
THIS RESTRICTED STOCK UNIT
AGREEMENT, dated December 18, 2006 (the “ Effective
Date ”), by and between Global Hyatt Corporation, a
Delaware corporation (the “ Company ”), and Mark
S. Hoplamazian (“ Executive ”).
WHEREAS, the Company and Executive
have entered into an Employment Agreement (as amended from time to
time, the “ Employment Agreement ”) dated
November 27, 2006, pursuant to which Executive will serve as
President and Chief Executive Officer of the Company on the terms
and conditions set forth and described therein; and
WHEREAS, pursuant to the Employment
Agreement, the Company has agreed to grant to Executive an
aggregate of Two Hundred Ten Thousand (210,000) restricted
stock units (the “ RSUs ”) representing the
right to receive an equal number of shares of common stock of the
Company, par value $0.01 per share (“ Common Stock
”) on the terms set forth herein.
NOW, THEREFORE, in consideration of
the mutual covenants set forth herein, the Company and the
Executive hereby agree as follows:
1. Definitions . Capitalized
terms not otherwise defined herein shall have the meaning set forth
in the Employment Agreement, unless otherwise indicated.
2. Grant of RSUs . Pursuant
to Section 5.2 of the Employment Agreement, Executive is
hereby granted, on the Effective Date, deferred compensation in the
form of Two Hundred Ten Thousand (210,000) RSUs pursuant to
the terms of this Agreement.
3. Dividend Equivalents . To
the extent that dividends are paid on Common Stock, Executive shall
be entitled to receive with respect to the RSUs (as such RSUs may
be adjusted under Section 6), dividend equivalent amounts
equal to the regular cash dividend payable to holders of Common
Stock (to the extent regular quarterly cash dividends are paid) as
if Executive were an actual shareholder with respect to the number
of shares of Common Stock equal to his outstanding RSUs (the
“ Dividend Equivalents ”). Executive’s
rights to Dividend Equivalents shall cease upon forfeiture or
payment of the RSUs pursuant to Section 4. The aggregate
amount of such Dividend Equivalents shall be held by the Company,
without interest thereon, and paid to Executive as soon as
practicable after the RSUs to which such Dividend Equivalents
relate vest in accordance with Section 4 below. Dividends
Equivalents paid on vested RSUs shall be paid at the same time as
the dividends paid to the holders of Common Stock.
4. Vesting and Payment of
RSUs .
(a) Until vested, the RSUs shall be
subject to forfeiture in the event of Executive’s termination
of employment with the Company and all of its subsidiaries (“
Termination of Service ”). Notwithstanding the
foregoing, the RSUs will vest and no longer be subject to
forfeiture under this Agreement as follows:
(i) One-Third of the RSUs shall vest
on each anniversary of the Effective Date, with full vesting on the
third anniversary of the Effective Date;
(ii) Notwithstanding
Section 4(a)(i), if Executive’s Termination of Service
is without Cause or by Executive for Good Reason, Executive shall
be fully vested in the RSUs upon such Termination of
Service;
(iii) Notwithstanding
Section 4(a)(i), if Executive’s employment with the
Company terminates by reason of the Executive’s death or
Disability, one-third of the RSUs will vest if the
Executive’s Termination of Service is on or prior to the
first Effective Date Anniversary, two-thirds of the RSUs will vest
if such date is on or after the first but before the second
Effective Date Anniversary, and Executive shall be fully vested in
the RSUs if his Termination of Service occurs after the second
Effective Date Anniversary;
(iv) Notwithstanding Sections
4(a)(i) or (ii), if Executive’s employment with the Company
is terminated by the Company for any reason within 12 months after
a Change in Control or in contemplation of a Change in Control,
then Executive shall be fully vested in the RSUs upon such
Termination of Service; or
(v) Notwithstanding anything
contained in this Section 4(a), Executive shall forfeit all
RSUs if his Termination of Service is for Cause prior to the third
anniversary of the Effective Date.
(b) Shares of Common Stock (“
Unit Shares ”) equal to the vested RSUs shall be paid
to the Executive in settlement of the RSUs on the earlier
of:
(i) The first business day following
the third anniversary of the Effective Date;
(ii) The first business day
following his Termination of Service if such Termination of Service
is prior to an IPO; or
(iii) The first business day
following the six month anniversary of his Termination of Service
if such Termination of Service is following an IPO.
(c) All Unit Shares shall be subject
to the terms of the Global Hyatt Corporation Long-Term Incentive
Plan Stockholders’ Agreement, as amended from time to time,
(the “ LTIP Stockholders’ Agreement ”). By
execution of this Agreement, Executive agrees to become a party to
and be treated as a Stockholder (as defined in the LTIP
Stockholders’ Agreement), and for all purposes thereof the
Unit Shares shall be treated as Common Stock issued upon exercise
of a vested SAR as defined in the LTIP Stockholders’
Agreement. For purposes of clarity, the parties acknowledged and
agree that the Existing Stockholders (as defined in the LTIP
Stockholders’ Agreement) shall be third party beneficiaries
of Executive’s agreements under this Section 4(c) as
though each Existing Stockholder was a signatory hereto for the
purposes of this Section 4(c).
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(d) If the Unit Shares are delivered following
an IPO, the Company shall deposit such Unit Shares in an account
designated by Executive and maintained at a brokerage house
selected by Executive. Any such Unit Shares shall be duly
authorized, fully paid and non-assessable shares, and listed with
the principal United States securities exchange on which the Common
Stock is admitted to trading.
(e) Except as otherwise provided in
this Agreement, (i) Executive shall not be deemed to be a
holder of any Common Stock pursuant to a Unit until the date such
shares are issued to him either in book or other electronic form,
or by the issuance of a certificate to him for such shares and
(ii) Executive shall not have any rights to dividends or any
other rights of a stockholder with respect to the shares of Common
Stock underlying the RSUs until such shares of Common Stock have
been issued to him, which issuance shall not be unreasonably
delayed.
(f) The Company may require that
Executive pay to the Company, or the Company may otherwise withhold
at the time of payment of an RSU, any such amount as is required by
law or regulation to be withheld for Federal, state or local income
tax or any other taxes incurred by reason of the payment. Such
withholding may be applied by the Company against other wages or
compensation payable to the Executive or may be applied against
Unit Shares otherwise deliverable under the RSU. If withholding is
applied against Unit Shares deliverable under the RSU, the amount
of Unit Shares withheld shall be based on the Share Value (as
defined in the LTIP) if prior to an IPO or the closing price of the
Common Stock on the principal United States securities exchange on
which the Common Stock is then traded if after an IPO on the date
of withholding. Notwithstanding anything to the contrary herein, if
the tax obligation arises during a period in which the Executive is
prohibited from trading under any policy of the Company or by
reason of the Securities Exchange Act of 1934, then the tax
withholding obligation shall automatically be satisfied by the
Company withholding Unit Shares.
(g) Executive’s right to
receive payment of any amounts under this Agreement shall be an
unfunded entitlement and shall be an unsecured claim against the
general assets of the Company.
5. Registration Covenant . As
soon as practicable following an IPO the Company agrees to file a
registration statement on Form S-8 registering the RSUs and the
Unit Shares deliverable thereunder.
6. Changes in the Common Stock
and Adjustment of RSUs .
(a) In the event the outstanding
shares of the Common Stock shall be changed into an increased
number of shares, through a share dividend or a split-up of shares,
or into a decreased number of shares, through a combination of
shares, then immediately after the record date for such change, the
number of RSUs then subject to this Agreement shall be
proportionately increased, in case of such share dividend or
split-up of shares, or proportionately decreased, in case of such
combination of shares. In the event the Company shall issue any of
its shares of stock or other securities or property (other than
Common Stock which is covered by the preceding sentence) in a
reclassification of the Common Stock (including without limitation
any such reclassification in connection with a
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consolidation or merger in which the Company is
the continuing entity), the kind and number of RSUs subject to this
Agreement immediately prior thereto shall be adjusted so that the
Executive shall be entitled to receive the same kind and number of
shares or other securities or property which the Executive would
have owned or have been entitled to receive after the happening of
any of the events described above, had he owned the shares of the
Common Stock represented by the RSUs under this Agreement
immediately prior to the happening of such event or any record date
with respect thereto, which adjustment shall become effective
immediately after the effective date of such event retroactive to
the record date, if any, for such event.
(b) In the event the Company shall
distribute to all holders of the Common Stock evidences of its
ind
