**Exhibit 10.7**

 

**SOLSTICE HOLDINGS LLC**

**RETENTION AND INCENTIVE EQUITY COMPENSATIONPROGRAM**

 

**RECP Award Agreement**

 

 

WHEREAS, Solstice Holdings LLC, a Delaware limited liability company(the “Company”), has established the Solstice Holdings LLC Retention andIncentive Equity Compensation Program (the “RIECP” or the “Program”),effective as of March 8, 2006, to assist in attracting key employees of oron behalf of CenterPoint Properties Trust, a Maryland real estate investmenttrust and a Subsidiary of the Company (“CenterPoint”), and to providethe Grantee with long-term incentives and rewards for superior performance andmaximizing shareholder value;

 

WHEREAS, the Retention Equity Compensation Plan (the “RECP”) isa component of the Program governing the grant of restricted Unvested Class AUnits to key employees, other than the members of the CenterPoint ManagementTeam;

 

WHEREAS,                             (the“Grantee”) is an employee of CenterPoint****andhas made and is expected to continue to make major contributions to theshort-term and long-term profitability, growth and financial strength ofCenterPoint;

 

WHEREAS, CenterPoint, the Company and the Grantee are parties to anemployment agreement dated March **      **,2006 (the “Employment Agreement”);

 

WHEREAS, the execution of this RECP Award Agreement in the favor of theGrantee in the form hereof (this “Agreement”) has been authorizedby a resolution of the Board or, as authorized by the Board, the Committee thatwas duly adopted effective as of                 (the “Date of Grant”).

 

NOW, THEREFORE, subject to the terms and conditions of the Program, theOperating Agreement and as hereinafter set forth, the Company hereby grants tothe Grantee                     restricted Unvested Class A Units (the “RECP Unvested Class AUnits”).

 

1.                                       Vestingof the RECP Unvested Class A Units.

 

(a)                                  Subject to the termsand conditions of the Operating Agreement and this Section 1, and providedthat the Grantee remains in the continuous employ of CenterPoint, the Grantee’sRECP Unvested Class A Units awarded hereunder will be treated as Unvested Class AUnits prior to the fifth (5th) anniversary of the Effective Date, and on andafter such date, the Grantee’s RECP Unvested Class A Units will be treatedas Vested Class A Units.

 

(b)                                 Notwithstanding theprovisions of Section 1(a) hereof, upon termination of the Grantee’semployment, the Grantee’s RECP Unvested Class A Units awarded under thisAgreement shall be subject to the vesting, forfeiture and other conditions asspecified

 

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in the Grantee’s Employment Agreement. Forpurposes of the terms and conditions of the Operating Agreement, any of theGrantee’s RECP Unvested Class A Units that vest pursuant to the terms ofthe Grantee’s Employment Agreement will be treated as Vested Class A Unitsand the total number of Unvested Class A Units will be equal to zero (0). Exceptas provided in this Section 1(b), all remaining RECP Unvested Class AUnits awarded hereunder shall be immediately forfeited, will not be treated aseither Vested Class A Units or Unvested Class A Units for purposes ofthis Agreement or the terms and conditions of the Operating Agreement, will notbe entitled to any further payments or Distributions and will have no furtherrights under the Program with respect to such RECP Unvested Class A Units.

 

(c)                                  Notwithstanding theprovisions of Section 1(a) hereof, in the event of a Change inControl (as defined in the Grantee’s Employment Agreement) prior to terminationof the Grantee’s employment, all of the Grantee’s RECP Unvested Class AUnits awarded hereunder shall immediately vest and become nonforfeitable.

 

(d)                                 Notwithstanding any ofthe provisions of Section 1 hereof and in accordance with the Program, theBoard may accelerate the vesting of the Grantee’s RECP Unvested Class AUnits awarded hereunder in connection with the termination of the Grantee’semployment.

 

(e)                                  The Grantee’s Vested Class AUnits, if any, shall be subject to the terms and conditions of the OperatingAgreement and the put/call rights or required sale rights, as applicable, setforth in the Grantee’s Employment Agreement.

 

2.                                       Distributions.

 

(a)                                  During Employment.Provided that the Grantee remains in the continuous employ of CenterPoint, theGrantee shall be eligible to receive such Grantee’s allocable share ofDistributions with respect to the RECP Unvested Class A Units awardedhereunder, and such units that become Vested Class A Units as and whenprovided for hereunder and under the Operating Agreement based on the Grantee’sClass A Sharing Percentage.

 

(b)                                 FollowingTermination of Employment. Following the termination of the Grantee’semployment with CenterPoint for any reason, the Grantee shall be eligible tocontinue to receive such Grantee’s allocable share of Distributions withrespect to the Grantee’s Vested Class A Units as and when provided underthe Operating Agreement based on the Grantee’s Class A Sharing Percentage.The Grantee’s Vested Class A Units shall continue to be subject to theterms and conditions of the Operating Agreement. The Grantee will not beentitled to any further payments or Distributions with respect to any RECPUnvested Class A Units and will have no further rights under the Programor the Operating Agreement with respect to such RECP Unvested Class AUnits.

 

3.                                       Transferability.Except as provided in the Operating Agreement, the Grantee’s rights under theRECP Unvested Class A Units shall not be transferable by the Granteewithout

 

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the prior Approval of the Board (or asdelegated by the Board, the Committee) and any attempted transfer without suchApproval shall be *void ab initio*.

 

4.                                       OperatingAgreement. The Grantee acknowledges and agrees that the RECP Unvested Class AUnits awarded hereunder, and any that become Vested Class A Units, aresubject to the terms and conditions of the Operating Agreement. The Granteefurther acknowledges and agrees that, to the extent Grantee has not alreadyexecuted the Operating Agreement or an addendum thereof, the Grantee will berequired to sign the addendum to the Operating Agreement, attached hereto as Exhibit A,agreeing to be bound by the terms and conditions of the Operating Agreement asa condition to receiving the RECP Unvested Class A Units awardedhereunder.

 

5.                                       Compliancewith Law. The Company shall comply with all applicable laws and regulationsof any duly constituted authority having jurisdiction over the issuance of theRECP Unvested Class A Units to Grantee as contemplated herein; provided,however, that notwithstanding any other provision of this Agreement, theCompany shall not be obligated to issue any RECP Unvested Class A Unitshereunder if the issuance thereof would result in a violation of any such lawor regulation.

 

6.                                       WithholdingTaxes.

 

(a)                                  Tothe extent that the Company or CenterPoint is required to withhold federal,state, local or foreign taxes in connection with any issuance or transferhereunder of RECP Unvested Class A Units to the Grantee or to the Grantee’sBeneficiary, as the case may be, it shall have the right to require theGrantee or the Grantee’s Beneficiary to remit to CenterPoint or the Company anamount sufficient to satisfy all federal, state and local withholding taxrequirements in connection with any payment made or benefit realized by theGrantee or the Grantee’s Beneficiary in connection with this award. The Board may makemutually agreed-upon arrangements with the Grantee or the Grantee’s Beneficiaryfor the satisfaction of such withholding liability, which may include, butnot be limited to, the relinquishment of any RECP Unvested Class A Units.

 

(b)                                 Ifthe Company or CenterPoint is obligated to pay any amount to a governmentalagency (or otherwise makes a payment to a governmental agency) because of (A) theGrantee’s status or otherwise specifically attributable to the Grantee in hisor her capacity as a Grantee with respect to federal, state or localwithholding taxes imposed with respect to (i) any issuance of Class AUnits to the Grantee by the Company under this award or (ii) any paymentsto the Grantee or (B) the Grantee’s breach of the Operating Agreement orviolation of any law, rule or regulation in his, her or its capacity as aGrantee, then the Company shall reduce the Distributions that would otherwisebe made to such Grantee or if such Distributions are insufficient to pay suchobligation such Grantee shall, to the fullest extent permitted by law,indemnify the Company in full for the entire amount paid (including, withoutlimitation, any interest, penalties and expenses associated with suchpayments).

 

7.                                       Continuationof Employment. Neither this Agreement nor any action taken hereunder shallbe construed as giving the Grantee any right to continued employment withCenterPoint, nor shall this Agreement or any action taken hereunder beconstrued as entitling

 

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CenterPoint to the services of the Granteefor any period of time. For the purposes of this Agreement, the continuousemployment of the Grantee with CenterPoint shall not be deemed interrupted, andthe Grantee shall not be deemed to have ceased to be employed CenterPoint byreason of the transfer of his employment among CenterPoint, the Company or aSubsidiary or Affiliate of CenterPoint or of the Company which adopts theProgram.

 

8.                                       LimitedRights. Except as otherwise provided in the Operating Agreement and theGrantee’s Employment Agreement, the granting of RECP Unvested Class AUnits hereunder shall not confer upon the Grantee any right to participate inthe management of the business and affairs of the Company or any Subsidiary orAffiliate of the Company. The granting of RECP Unvested Class A Unitshereunder shall confer upon the Grantee only those rights set forth in theOperating Agreement, the Program, the Grantee’s Employment Agreement and thisAgreement.

 

9.                                       UnfundedPlan. The Program shall be unfunded and shall not create (or be construedto create) a trust or separate fund.

 

10.                                 Amendments.Any amendment to the Program shall be deemed to be an amendment to this Agreementto the extent that the amendment is applicable hereto; provided, however,that no amendment shall adversely affect the rights of the Grantee hereunderunder any Class A Units without the Grantee’s consent.

 

11.                                 Assignment.This Agreement shall be binding upon, and shall inure to the benefit of theCompany and any successor. The Company may assign and transfer thisAgreement, and delegate its duties hereunder, to a Subsidiary of CenterPoint orthe Company.

 

12.                                 Severability.In the event that one or more of the provisions of the Program or thisAgreement becomes invalid, illegal or unenforceable in any jurisdiction, orwould disqualify the Program, this Agreement or the RECP Unvested Class AUnits under any law deemed applicable by the Board, the Board shall replaceeach invalid, illegal or unenforceable provision with a valid, legal andenforceable provision which will most nearly and equitably satisfy the economiceffect of the invalid, illegal or unenforceable provision.

 

13.                                 GoverningLaw. This Agreement is made in, and shall be construed in accordance with,the laws of the State of Delaware.

 

14.                                 AgreementSubject to Program. The RECP Unvested Class A Units granted under thisAgreement and all of the terms and conditions hereof are subject to all of theterms and conditions of the Program. In the event of any inconsistency betweenthis Agreement and the Program, the terms of the Program will govern.

 

15.                                 CapitalizedTerms. Capitalized terms used herein and not otherwise defined herein havethe meanings assigned to such terms in the Program or to the extent not definedin the Program, in the Operating Agreement.

 

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This Agreement is hereby executed by theCompany on this               day of                     ,20    .

 
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This Agreement is hereby executed by theundersigned Grantee this                       day of                   20    . The Grantee hereby acknowledges receipt of anexecuted original of this Agreement and accepts this award of RECP Unvested Class AUnits, subject to the terms and conditions of the Program, the OperatingAgreement and the terms and conditions set forth above. TheGrantee further acknowledges and agrees that, to the extent Grantee has notalready executed the Operating Agreement or an addendum thereof, the Granteewill be required to sign the addendum to the Operating Agreement, attachedhereto as Exhibit A, agreeing to be bound by the terms andconditions of the Operating Agreement as a condition to receiving the RECPUnvested Class A Units awarded hereunder.

 
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