Exhibit 10.18

 

ACTIVISION BLIZZARD, INC.

 

2007 INCENTIVE PLAN

 

NOTICE OF RESTRICTED SHARE UNIT AWARD

 

You have been awarded Restricted Share Units of Activision Blizzard, Inc. (the
“Company”), as follows:

 

·                  Your name:  Brian G. Kelly

 

·                  Total number of Restricted Share Units awarded:  363,637

 

·                  Date of Grant:  July 9, 2008

 

·                  Grant ID:  07000873

 

·                  Your Award of Restricted Share Units is governed by the terms
and conditions set forth in:

 

·                  this Notice of Restricted Share Unit Award;

 

·                  the Restricted Share Unit Award Terms attached hereto as
Exhibit A (the “Award Terms”);

 

·                  your Replacement Bonus Agreement with the Company, dated
December 1, 2007 (the “Replacement Bonus Agreement”); and

 

·                  the Company’s 2007 Incentive Plan, the receipt of a copy of
which you hereby acknowledge.

 

·                  Your Award of Restricted Share Units has been made in
connection with your entering into each of the Replacement Bonus Agreement and
your Amended and Restated Employment Agreement with the Company dated as of
December 1, 2007 (the “Employment Agreement”).

 

·                  Schedule for Vesting:  Except as otherwise provided under the
Award Terms, the Restricted Share Units awarded to you will vest as follows,
provided you remain continuously employed by the Company Group:

 

Schedule for Vesting

 

Vesting Date

 

No. of Restricted
Share Units Vesting at
Vesting Date

 

Cumulative No. of
Restricted Share Units
Vested at Vesting Date

 

 

 

 

 

 

 

December 31, 2010

 

363,637

 

363,637

 

 

·                  Please sign and return to the Company this Notice of
Restricted Share Unit Award, which bears an original signature on behalf of the
Company.  You are urged to do so promptly.

 

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·                  Please return the signed Grant Notice to the Company at:

 

Activision Blizzard, Inc.
3100 Ocean Park Boulevard
Santa Monica, CA  90405
Attn:  Stock Plan Administration

 

You should retain the enclosed duplicate copy of this Notice of Restricted Share
Unit Award for your records.

 

Any capitalized term used but not otherwise defined herein shall have the
meaning ascribed to such term in the Award Terms.

 

 

ACTIVISION BLIZZARD, INC.

 

 

 

 

 

/s/ Ann E. Weiser

 

Ann E. Weiser

 

Title: Chief Human Resources Officer

 

Date: 

September 29, 2008

 

 

ACCEPTED AND AGREED:

 

 

/s/ Brian G. Kelly

 

Brian G. Kelly

 

Date: 

  October 8, 2008

 

 

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EXHIBIT A

 

ACTIVISION BLIZZARD, INC.

 

2007 INCENTIVE PLAN

 

RESTRICTED SHARE UNIT AWARD TERMS

 

1.                                      Definitions.

 

(a)                                  For purposes of these Award Terms, the
following terms shall have the meanings set forth below:

 

“Award” means the award described on the Grant Notice.

 

“Cause” has the meaning given to such term in the Employment Agreement.

 

“Common Shares” means the shares of common stock, par value $0.000001 per share,
of the Company or any security into which such Common Shares may be changed by
reason of any transaction or event of the type referred to in Section 9 hereof. 
For the avoidance of doubt, the term “Common Shares” as used in these Award
Terms shall include “Company Common Stock” as such term is used in the
Employment Agreement.

 

“Company Group” has the meaning given to such term in the Employment Agreement.

 

“Company-Sponsored Equity Account” means an account that is created with the
Equity Account Administrator in connection with the administration of the
Company’s equity plans and programs, including the Plan.

 

“Date of Grant” means the Date of Grant of the Award set forth on the Grant
Notice.

 

“Equity Account Administrator” means the brokerage firm utilized by the Company
from time to time to create and administer accounts for participants in the
Company’s equity plans and programs, including the Plan.

 

“409A Delayed Payment Date” has the meaning given to such term in the Employment
Agreement.

 

“Grantee” means the recipient of the Award named on the Grant Notice.

 

“Grant Notice” means the Notice of Restricted Share Unit Award to which these
Award Terms are attached as Exhibit A.

 

“Plan” means the Activision, Inc. 2007 Incentive Plan, as amended from time to
time.

 

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“Restricted Share Units” means units subject to the Award, which represent the
conditional right to receive Common Shares in accordance with the Replacement
Bonus Agreement, the Grant Notice and these Award Terms, unless and until such
units become vested or are forfeited to the Company in accordance with the Grant
Notice and these Award Terms.

 

“Separation from Service” has the meaning given to such term in the Employment
Agreement.

 

“Specified Employee” has the meaning given to such term in the Employment
Agreement.

 

“Vested Shares” means Common Shares to which the holder of Restricted Share
Units becomes entitled upon vesting thereof in accordance with Section 2 or 3
hereof.

 

“Withholding Taxes” means any taxes, including, but not limited to, social
security and Medicare taxes and federal, state and local income taxes, required
to be withheld under any applicable law.

 

(b)                                 Any capitalized term used but not otherwise
defined herein shall have the meaning ascribed to such term in the Plan.

 

2.                                      Vesting.  Except as otherwise set forth
in these Award Terms, the Restricted Share Units shall vest in accordance with
the “Schedule for Vesting” set forth on the Grant Notice.  Each Restricted Share
Unit, upon vesting thereof, shall entitle the holder thereof to receive one
Common Share (subject to adjustment pursuant to Section 9 hereof).

 

3.                                       Termination of Employment.  In the
event of a termination of Grantee’s employment for any reason other than a
termination by the Company for Cause, all unvested Restricted Share Units shall
immediately vest.  In the event that Grantee’s employment is terminated by the
Company for Cause prior to the vesting in full of the Restricted Share Units, as
of the date of such termination of employment all Restricted Share Units shall
cease to vest and, with the exception of any Restricted Share Units attributable
to Vested Shares that have yet to settle pursuant to Section 7 hereof, shall
immediately be forfeited to the Company without payment of consideration by the
Company.

 

4.                                       Tax Withholding.  The Company shall
have the right to require Grantee to satisfy any Withholding Taxes resulting
from the vesting of any Restricted Share Units, the issuance or transfer of any
Vested Shares or otherwise in connection with the Award at the time such
Withholding Taxes become due.  Grantee shall be entitled to satisfy any
Withholding Taxes contemplated by this Section 4:  (a) by delivery to the
Company of a bank check or certified check or wire transfer of immediately
available funds; (b) through the delivery of irrevocable written instructions,
in a form acceptable to the Company, that the Company withhold Vested Shares
otherwise then deliverable having a value equal to the aggregate amount of the
Withholding Taxes (valued in the same manner used in computing the amount of
such Withholding Taxes); or (c) with the Company’s consent, by any combination
of (a) and (b) above.  Notwithstanding anything to the contrary contained
herein, (i) the Company or any of its subsidiaries or affiliates shall have the
right to withhold from Grantee’s compensation any Withholding Taxes contemplated
by this Section 4 and (ii) the Company shall have no obligation

 

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to deliver any Vested Shares unless and until all Withholding Taxes contemplated
by this Section 4 have been satisfied.

 

5.                                       Reservation of Shares.  The Company
shall at all times reserve for issuance or delivery upon vesting of the
Restricted Share Units such number of Common Shares as shall be required for
issuance or delivery upon vesting thereof.

 

6.                                       Dividend Equivalents.  In the event
that any cash dividends are declared and paid on Common Shares to which the
holder of Restricted Share Units would be entitled upon vesting thereof, such
holder shall be paid, on the payment date for such dividend, the amount that
such holder would have received if the Restricted Share Units had vested, and
the Common Shares to which such holder was thereupon entitled had been issued
and outstanding and held of record by such holder, as of the record date for
such dividend; provided, however, that no such dividend equivalents shall be
paid if the Restricted Share Units have been forfeited to the Company in
accordance with Section 3 hereof prior to payment thereof.  Notwithstanding the
foregoing, in no event shall any such dividend equivalents be paid later than
the 45th day following the fiscal year in which the related dividends are paid. 
For purposes of the time and form of payment requirements of Section 409A of the
Code, such dividend equivalents shall be treated separately from the Restricted
Share Units.

 

7.                                       Receipt and Delivery.  Subject to
Section 12(c) hereof, as soon as administratively practicable (and, in any
event, within thirty (30) days) after the Restricted Share Units vest, the
Company shall (i) effect the issuance or transfer of the resulting Vested
Shares, (ii) cause the issuance or transfer of such Vested Shares to be
evidenced on the books and records of the Company, and (iii) cause such Vested
Shares to be delivered to a Company-Sponsored Equity Account in the name of the
person entitled to such Vested Shares (or, with the Company’s consent, such
other brokerage account as may be requested by such person); provided, however,
that, in the event such Vested Shares are subject to a legend as set forth in
Section 13 hereof, the Company shall instead cause a certificate evidencing such
Vested Shares and bearing such legend to be delivered to the person entitled
thereto.

 

8.                                       Committee Discretion.  Except as may
otherwise be provided in the Plan, the Committee shall have sole discretion to
(a) interpret any provision of the Plan, the Grant Notice and these Award Terms,
(b) make any determinations necessary or advisable for the administration of the
Plan and the Award, and (c) waive any conditions or rights of the Company under
the Award, the Grant Notice or these Award Terms.  Without intending to limit
the generality or effect of the foregoing, any decision or determination to be
made by the Committee pursuant to these Award Terms, including whether to grant
or withhold any consent, shall be made by the Committee in its sole and absolute
discretion, subject only to the terms of the Plan.  Subject to the terms of the
Plan, the Committee may amend the terms of the Award prospectively or
retroactively; however, no such amendment may materially and adversely affect
the rights of Grantee taken as a whole without Grantee’s consent.  Without
intending to limit the generality or effect of the foregoing, the Committee may
amend the terms of the Award (i) in recognition of unusual or nonrecurring
events (including, without limitation, events described in Section 9 hereof)
affecting the Company or any of its subsidiaries or affiliates or the financial
statements of the Company or any of its subsidiaries or affiliates, (ii) in
response to changes in applicable

 

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laws, regulations or accounting principles and interpretations thereof, or
(iii) to prevent the Award from becoming subject to any adverse consequences
under Section 409A of the Code.

 

9.                                       Adjustments.  Notwithstanding anything
to the contrary contained herein, pursuant to Section 12 of the Plan, the
Committee will make or provide for such adjustments to the Award as are
equitably required to prevent dilution or enlargement of the rights of Grantee
that would otherwise result from (a) any stock dividend, stock split,
combination of shares, recapitalization or other change in the capital structure
of the Company, or (b) any change of control, merger, consolidation, spin-off,
split-off, spin-out, split-up, reorganization, partial or complete liquidation
or other distribution of assets, or issuance of rights or warrants to purchase
securities, or (c) any other corporate transaction or event having an effect
similar to any of the foregoing.  Moreover, in the event of any such transaction
or event, the Committee, in its discretion, may provide in substitution for the
Award such alternative consideration (including, without limitation, cash or
other equity awards), if any, as it may determine to be equitable in the
circumstances and may require in connection therewith the surrender of the
Award.

 

10.                                 Registration and Listing.  Notwithstanding
anything to the contrary contained herein, the Company shall not be obligated to
issue or transfer any Restricted Share Units or Vested Shares, and no Restricted
Share Units or Vested Shares may be sold, assigned, transferred, pledged,
hypothecated or otherwise disposed of or encumbered in any way, unless such
transaction is in compliance with (a) the Securities Act of 1933, as amended, or
any comparable federal securities law, and all applicable state securities laws,
(b) the requirements of any securities exchange, securities association, market
system or quotation system on which securities of the Company of the same class
as the securities subject to the Award are then traded or quoted, (c) any
restrictions on transfer imposed by the Company’s certificate of incorporation
or bylaws, and (d) any policy or procedure the Company has adopted with respect
to the trading of its securities, in each case as in effect on the date of the
intended transaction.  The Company is under no obligation to register, qualify
or list, or maintain the registration, qualification or listing of, Restricted
Share Units or Vested Shares with the SEC, any state securities commission or
any securities exchange, securities association, market system or quotation
system to effect such compliance.  Grantee shall make such representations and
furnish such information as may be appropriate to permit the Company, in light
of the then existence or non-existence of an effective registration statement
under the Securities Act of 1933, as amended, relating to Restricted Share Units
or Vested Shares, to issue or transfer Restricted Share Units or Vested Shares
in compliance with the provisions of that or any comparable federal securities
law and all applicable state securities laws.  The Company shall have the right,
but not the obligation, to register the issuance or transfer of Restricted Share
Units or Vested Shares or resale of Restricted Share Units or Vested Shares
under the Securities Act of 1933, as amended, or any comparable federal
securities law or applicable state securities law.

 

11.                                 Transferability.  Except as otherwise
permitted under the Plan or this Section 11, the Restricted Share Units shall
not be transferable by Grantee other than by will or the laws of descent and
distribution.  With the Company’s consent, Grantee may transfer Restricted Share
Units for estate planning purposes or pursuant to a domestic relations order;
provided, however, that any transferee shall be bound by all of the terms and
conditions of the Plan, the Grant Notice and these Award Terms and shall execute
an agreement in form and substance satisfactory to the

 

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Company in connection with such transfer; and provided, further that Grantee
will remain bound by the terms and conditions of the Plan, the Grant Notice and
these Award Terms.

 

12.                                Section 409A.

 

(a)                                  Payments contemplated with respect to the
Award are intended to comply with Section 409A of the Code, and all provisions
of the Plan, the Grant Notice and these Award Terms shall be construed and
interpreted in a manner consistent with the requirements for avoiding taxes or
penalties under Section 409A of the Code.  Notwithstanding the foregoing,
(i) nothing in the Plan, the Grant Notice and these Award Terms shall guarantee
that the Award is not subject to taxes or penalties under Section 409A of the
Code and (ii) if any provision of the Plan, the Grant Notice or these Award
Terms would, in the reasonable, good faith judgment of the Company, result or
likely result in the imposition on Grantee or any other person of a penalty tax
under Section 409A of the Code, the Committee may, in its sole discretion,
modify the terms of the Plan, the Grant Notice or these Award Terms, without the
consent of Grantee, in the manner that the Committee may reasonably and in good
faith determine to be necessary or advisable to avoid the imposition of such
penalty tax and in a manner designed to preserve the economics of the award to
Grantee.

 

(b)                                 Neither Grantee nor any of Grantee’s
creditors or beneficiaries shall have the right to subject any deferred
compensation (within the meaning of Section 409A of the Code) payable with
respect to the Award to any anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment or garnishment.  Except as permitted
under Section 409A of the Code, any deferred compensation (within the meaning of
Section 409A of the Code) payable to Grantee or for Grantee’s benefit with
respect to the Award may not be reduced by, or offset against, any amount owing
by Grantee to the Company.

 

(c)                                  If (i) the Committee determines in good
faith that the issuance or transfer of Vested Shares to Grantee or his or her
estate or beneficiaries hereunder by reason of Grantee’s Separation from Service
with the Company or any of its subsidiaries or affiliates does not qualify for
the “short-term deferral exception” or otherwise would constitute a “deferral of
compensation” under Section 409A of the Code, (ii) Grantee is a Specified
Employee and (iii) delay of payment is required in order to avoid tax penalties
under Section 409A of the Code but is not already provided for by this Award,
the Company shall cause the issuance or transfer of such Vested Shares to
Grantee or Grantee’s estate or beneficiary upon the 409A Delayed Payment Date.

 

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13.                                 Legends.  The Company may, if determined by
it based on the advice of counsel to be appropriate, cause any certificate
evidencing Vested Shares to bear a legend substantially as follows:

 

“THE SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED FOR SALE, SOLD OR
OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE ACT.”

 

14.                                 No Right to Continued Employment.  Nothing
contained in the Grant Notice or these Award Terms shall be construed to confer
upon Grantee any right to be continued in the employ of the Company or any of
its subsidiaries or affiliates or derogate from any right of the Company or any
of its subsidiaries or affiliates to retire, request the resignation of, or
discharge Grantee at any time, with or without cause.

 

15.                                 No Rights as Stockholder.  No holder of
Restricted Share Units shall, by virtue of the Grant Notice or these Award
Terms, be entitled to any right of a stockholder of the Company, either at law
or in equity, and the rights of any such holder are limited to those expressed,
and are not enforceable against the Company except to the extent set forth in
the Plan, the Grant Notice and these Award Terms.

 

16.                                 Severability.  In the event that one or more
of the provisions of these Award Terms shall be invalidated for any reason by a
court of competent jurisdiction, any provision so invalidated shall be deemed to
be separable from the other provisions hereof, and the remaining provisions
hereof shall continue to be valid and fully enforceable.

 

17.                                 Governing Law.  To the extent that federal
law does not otherwise control, the validity, interpretation, performance and
enforcement of the Grant Notice and these Award Terms shall be governed by the
laws of the State of Delaware, without giving effect to principles of conflicts
of laws thereof.

 

18.                                 Successors and Assigns.  The provisions of
the Grant Notice and these Award Terms shall be binding upon and inure to the
benefit of the Company, its successors and assigns, and Grantee and, to the
extent applicable, Grantee’s permitted assigns under Section 11 hereof and
Grantee’s estate or beneficiary(ies) as determined by will or the laws of
descent and distribution.

 

19.                                 Notices.  Any notice or other document which
Grantee or the Company may be required or permitted to deliver to the other
pursuant to or in connection with the Grant Notice or these Award Terms shall be
in writing, and may be delivered personally or by mail, postage prepaid, or
overnight courier, addressed as follows:  (a) if to the Company, at its office
at 3100 Ocean Park Boulevard, Santa Monica, California 90405, Attn: Stock Plan
Administration, or such other address as the Company by notice to Grantee may
designate in writing from time to time; and (b) if to Grantee, at the address
shown in the Employment Agreement or such other

 

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address as Grantee by notice to the Company may designate in writing from time
to time.  Notices shall be effective upon receipt.

 

20.                                 Conflict with Replacement Bonus Agreement or
Plan.  In the event of any conflict between the terms of the Replacement Bonus
Agreement and the terms of the Grant Notice or these Award Terms, the terms of
the Grant Notice or these Award Terms, as the case may be, shall control.  In
the event of any conflict between the terms of the Replacement Bonus Agreement,
the Grant Notice or these Award Terms and the terms of the Plan, the terms of
the Plan shall control.

 

21.                                 Deemed Agreement.  By accepting the Award,
Grantee is deemed to be bound by the terms and conditions set forth in the
Replacement Bonus Agreement, the Plan, the Grant Notice and these Award Terms.

 

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