EXHIBIT 10.14
RESTRICTED STOCK UNIT AWARD
AGREEMENT
THIS RESTRICTED STOCK UNIT 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
to Executive 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 herein, 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) a number of options specified in that
Option Award Agreement between the parties hereof dated as of the
date hereof and subject to the terms and conditions therein will be
granted to Executive in full settlement of any increased value in
the Partnership Restricted Equity Units granted to Executive prior
to the Offering 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 any Company by Executive of such failure;
provided that it is understood that this clause (A) shall
not apply if a 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.](1)
“ 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
(1)
Only include for CEO/SVP.
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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 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.](2)
[“ 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”.](3)
“ Executive ” has the
meaning specified in the Preamble .
“ Grant Date ” means the
date hereof.
“ Offering ” has the
meaning specified in the Recitals .
“ 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 .
(2)
Only include for CEO.
(3)
Only include for CEO/SVP.
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SECTION 2
ASSUMPTION, ADJUSTMENT AND
MODIFICATION
OF PARTNERSHIP RESTRICTED EQUITY UNITS INTO ORBITZ RESTRICTED STOCK
UNITS
2.1.
Assumption . Subject to the
terms and conditions hereof, effective immediately prior to the
Offering, the Partnership hereby assigns to the Company and the
Company hereby assumes and accepts assignment from the Partnership,
and Executive hereby consents to such assignment, all of the
Partnership Restricted Equity Units granted to Executive that are
then unvested. Following the Offering, the Partnership and its
affiliates (other than the Company) shall have no further
obligation in respect of any such Partnership Restricted Equity
Unit so assumed.
2.2.
Adjustment and Modification
. The Orbitz Restricted Stock Units assumed by the Company are
hereby adjusted and modified, effective immediately following the
foregoing assumption and immediately prior to the Offering, and
Executive hereby consents to such adjustment and modification, such
that:
(a)
The number of Orbitz Restricted Stock Units (which number, as
adjusted and modified herein, is specified on the signature page
hereto) shall be adjusted to equal the product of (i) the
number of unvested Partnership Restricted Equity Units held by
Executive immediately prior to the foregoing assumption multiplied
by (ii) the ratio of (A) the fair market value of a
Class A-2 Interest of the Partnership as of the Offering, as
reasonably determined by the Board, to (B) the fair market
value of a Share as of the Offering, as evidenced by the offering
price used in the Offering (such product to be rounded down to the
nearest whole number);
(b)
Each Orbitz Restricted Stock Unit will carry the right to receive
from the Company, on the terms and conditions described herein, in
the sole discretion of the Board, either (i) one Share as of the
date of vesting or (ii) cash equal to the fair market value (as
determined by the Board in good faith) of one Share as of the date
of vesting (and, as provided herein, distributions thereon) in lieu
of one Class A-2 Interest (and distributions thereon), and
Executive shall have no further rights with respect to any Orbitz
Restricted Stock Unit that is paid in Shares or cash, or that is
forfeited or terminates pursuant to this Agreement or the Plan;
and
(c)
Each Orbitz Restricted Stock Unit will be governed by the terms
hereof and the Plan, as may be amended from time to
time.
2.3.
Vested Partnership Restricted
Equity Units . For the avoidance of doubt, Partnership
Restricted Equity Units that are vested, as of the Offering, shall
not be modified in any respect under this Agreement and shall
remain subject to the terms of the Partnership Award
Agreement.
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SECTION 3
TERMS OF RESTRICTED STOCK
UNITS
3.1.
Vesting Schedule
.
(a)
Subject to the provisions of this Agreement and the Plan, 5.555% of
the Orbitz Restricted Stock Units shall vest on August 25, 2007, an
additional 8.586% of the Orbitz Restricted Stock Units shall vest
on each subsequent November 25, February 25, May 25 and August 25
thereafter through February 25, 2010, and any unvested Orbitz
Restricted Stock Units shall become fully vested on May 25, 2010
[(each, a “ Scheduled Vesting Date ”)](4);
provided, however, that no vesting shall occur after the
termination of Executive’s employment with the Company for
any reason, and any unvested Orbitz Restricted Stock Units shall be
immediately cancelled by the Company without consideration after
termination of Executive’s employment with the Company for
any reason.
(b)
[Notwithstanding the foregoing, the Orbitz Restricted Stock Units
shall become fully vested immediately prior to a Change in
Control.](5) [The Orbitz Restricted Stock Units shall be treated in
accordance with the provisions of Section 7 of the Plan in the
event of a Change in Control.](6)
(c)
[Notwithstanding the foregoing, upon any termination of
Executive’s employment with the Company by the Company
without Cause, the Orbitz Restricted Stock Units which would have
become vested had the Executive remained employed by the Company
through one year from the date of such termination shall become
immediately vested as of the date of such
termination.](7)
(d)
[Notwithstanding the foregoing, 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, the Orbitz Restricted Stock Units which
would have become vested on:
(i)
the next four Scheduled Vesting Dates shall become immediately
vested as of the date of such termination if such termination
occurs between May 26 and November 25 (inclusive);
(ii)
the next three Scheduled Vesting Dates shall become immediately
vested as of the date of such termination if such termination
occurs between November 26 and February 25 (inclusive);
and
(4) Only include for
CEO.
(5) Full and automatic
accelerated vesting for CEO/SVP/GVP.
(6) Accelerated vesting
at discretion of Board for levels below GVP.
(7) One year forward
vesting for CEO/SVP.
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(iii)
the next two Scheduled Vesting Dates shall become immediately
vested as of the date of such termination if such termination
occurs between February 26 and May 25 (inclusive).](8)
(e)
The Board may determine at any time before the Orbitz Restricted
Stock Units expire or terminate that any or all of the Orbitz
Restricted Stock Units shall become vested at any time.
3.2.
Dividends . Executive shall
be entitled to be credited with dividend equivalents with respect
to the Orbitz Restricted Stock Units, calculated as follows:
on each date that a cash dividend is paid by the Company while the
Orbitz Restricted Stock Units are outstanding, Executive shall be
credited with an additional number of Orbitz Restricted Stock Units
equal to the number of whole Shares (valued at fair market value
(as determined by the Board in good faith) on such date) that could
be purchased on such date with the aggregate dollar amount of the
cash dividend that would have been paid on the Orbitz Restricted
Stock Units had the Orbitz Restricted Stock Units been issued as
Shares. The additional Orbitz Restricted Stock Units credited under
this Section shall be subject to the same terms and conditions
applicable to the Orbitz Restricted Stock Units originally awarded
hereunder, including, without limitation, for purposes of vesting
and forfeiture and crediting of additional dividend
equivalents.
3.3.
Termination of Employment .
[Subject to Section[s] 3.1
],(9) if
Executive’s employment with the Company terminates for any
reason, the Orbitz Restricted Stock Units, to the extent not then
vested, shall be immediately canceled by the Company without
consideration.
3.4.
Limited Transferability .
The Orbitz Restricted Stock Units may not be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of or
encumbered, other than by will or the laws of inheritance following
Executive’s death.
3.5.
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 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:
(8) Forward vesting for
termination due to death, Disability and Constructive Termination
for CEO only.
(9) Insert Section
3.1(b) for GVP; Sections 3.1(b) and (c) for SVP; and Sections
3.1(b) through (d) for CEO.
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(a)
the Orbitz Restricted Stock Units, to the extent not then vested,
shall be immediately canceled by the Company without
consideration,
(b)
Executive shall repay to the Company any cash received pursuant to
the vesting of any Orbitz Restricted Stock Unit 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,
(c)
any Shares acquired pursuant to the vesting of any Orbitz
Restricted Stock Unit 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 forfeited and returned to the
Company without consideration, and
(d)
in the event Executive has sold or otherwise disposed of Shares
acquired pursuant to the vesting of any Orbitz Restricted Stock
Unit 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, 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.
SEClTION 4
NON-COMPETITION AND
CONFIDENTIALITY
4.1.
Non-Competition
.
(a)
From the date hereof while employed by the Company and for a [
-year](10)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 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.
(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 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
(10) Two years for CEO;
1 year for SVP/GVP/VP.
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