EX-10.37



 





Exhibit 10.37




PHH CORPORATION




RESTRICTED STOCK UNIT

AWARD NOTICE



We are pleased to notify you that PHH Corporation (the “Company”) has awarded you Restricted Stock
Units. The Restricted Stock Units represent the Company’s unfunded and unsecured promise to issue
shares of the Company’s Stock at a future date subject to the terms and conditions of the attached
Restricted Stock Unit Award Agreement (the “Agreement”) and the PHH Corporation 2005 Equity and
Incentive Plan (the “Plan”). This Restricted Stock Unit Award Notice (the “Award Notice”)
constitutes part of and is subject to the terms and provisions of the Agreement and the Plan.
Capitalized terms used but not defined in this Award Notice shall have the meanings set forth in
the Agreement or the Plan.




	 	 	 
	Grantee:
	 	[Name]
	 
	 	[Address]
	 
	 	 
	 
	 	 
	Participant #:
	 	[_______]
	 
	 	 
	Grant Date:
	 	June 28, 2005
	 
	 	 
	Number of Restricted
Stock Units:
	 	[__________]
	 
	 	 
	Settlement Date:
	 	For each Restricted Stock Unit, except as otherwise provided by the Agreement, the date on which such Restricted Stock Unit becomes vested in accordance with the Vesting Schedule set forth below.
	 
	 	 
	Performance Goals
for Accelerated Vesting:
	 	
The Restricted Stock Units may be subject to accelerated vesting in accordance with the Vesting Schedule set forth below.  Accelerated vesting shall be conditioned on the Company’s attainment of Performance Goals, as determined and established by the Compensation Committee.
	 
	 	 
	 
	 	The Compensation Committee has established the Performance Goals relating to the Restricted Stock Units that may become vested as a result of accelerated vesting on June 28, 2006, based on PHH Corporation’s return on equity and net income growth measured for the 2005 fiscal year.
	 
	 	 
	 
	 	The Compensation Committee shall establish Performance Goals based on PHH Corporation’s return on equity and net income growth on an annual basis for the Restricted Stock Units that may






 









 






	 	 	 
	 
	 	become vested as a result of accelerated vesting on June 28, 2007, June 28, 2008 and June 28, 2009.
	 
	 	 
	Vesting Schedule:
	 	 
	 
	 	To the extent the Company attains the applicable Performance Goals, subject to the provisions of the Agreement and the Plan and provided that you remain continuously employed with the Company through the respective accelerated vesting dates, the Restricted Stock Units will be subject to accelerated vesting as follows:
	 
	 	 
	 
	 	Accelerated Vesting Date: June 28, 2006
 25% of the Restricted Stock Units shall become vested on June 28, 2006, if the Company achieves 100% of its target (29% net income growth and 7.25% return on equity) for the 2005 fiscal year.
	 
	 	 
	 
	 	Accelerated Vesting Date: June 28, 2007
 25% of the Restricted Stock Units shall become vested on June 28, 2007, if the Company achieves 100% of its target net income growth and return on equity (to be determined by the Compensation Committee) for the fiscal year ended immediately prior to June 28, 2007.
	 
	 	 
	 
	 	Accelerated Vesting Date: June 28, 2008
 25% of the Restricted Stock Units shall become vested on June 28, 2008, if the Company achieves 100% of its target net income growth and return on equity (to be determined by the Compensation Committee) for the fiscal year ended immediately prior to June 28, 2008.
	 
	 	 
	 
	 	Accelerated Vesting Date: June 28, 2009
 25% of the Restricted Stock Units shall become vested on June 28, 2009, if the Company achieves 100% of its target net income growth and return on equity (to be determined by the Compensation Committee) for the fiscal year ended immediately prior to June 28, 2009.
	 
	 	 
	 
	 	Subject to the provisions of the Agreement and the Plan, and provided that you remain continuously employed with the Company through the respective vesting dates set forth below, the Restricted Stock Units not vested as a result of the accelerated vesting provisions listed above shall become vested as follows:






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	 	Vesting Date: June 28, 2009
 33.33% of the Restricted Stock Units not previously vested due to attainment of Performance Goals shall become vested on June 28, 2009.
	 
	 	 
	 
	 	Vesting Date: June 28, 2010
 33.33% of the Restricted Stock Units not previously vested due to attainment of Performance Goals shall become vested on June 28, 2010.
	 
	 	 
	 
	 	Vesting Date: June 28, 2011
 33.33% of the Restricted Stock Units not previously vested due to attainment of Performance Goals shall become vested on June 28, 2011.
	 
	 	 
	Certification of
Performance Goals:
	 	
All performance results described above shall be subject to the certification and approval of the Compensation Committee. All decisions of the Compensation Committee regarding attainment of Performance Goals and the extent of accelerated vesting (or no accelerated vesting) in respect of all Awards with shall be final and binding on all parties.





We congratulate you on the recognition of your importance to our organization and its future.



	 	 	 	 	 
	 	PHH CORPORATION


	 
	 	By:  	 	 
	 
	 	Name:	 	 
	 	Title:	 	 
	 	Date:	 	 
	 




RETAIN THIS NOTIFICATION AND YOUR AWARD AGREEMENT WITH

YOUR IMPORTANT DOCUMENTS AS A RECORD OF THIS AWARD.





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PHH CORPORATION




RESTRICTED STOCK UNIT AWARD AGREEMENT




PHH Corporation, a Maryland corporation (the “Company”) has granted to the individual (the
“Grantee”) named in the Restricted Stock Unit Award Notice to which this Restricted Stock Unit
Award Agreement (the “Agreement”) is attached, an award consisting of restricted stock units
relating to the common stock, par value $0.01 per share, of the Company (the “Restricted Stock
Units”), subject to the terms and conditions set forth in the Award Notice and this Agreement. The
restricted stock units have been granted pursuant to the PHH Corporation 2005 Equity and Incentive
Plan (the “Plan”).



WHEREAS, the Compensation Committee of the Board of Directors of the Company (the “Committee”)
has the authority under and pursuant to the Plan to grant and establish the terms of awards to
eligible employees of the Company and its Subsidiaries; and



WHEREAS, the Compensation Committee of the Board of Directors desires to grant an award of
Restricted Stock Units to the Grantee, subject to the terms and conditions of the Plan, the Award
Notice and this Agreement.



In consideration of the provisions contained in this Agreement, the Company and the Grantee
agree as follows:



1.     The Plan. The Award granted to the Grantee hereunder is pursuant to the Plan. A copy of a
prospectus for the Plan is attached hereto and the terms of such Plan are hereby incorporated in
this Agreement. Terms used in this Agreement which are not defined in this Agreement shall have
the meanings used or defined in the Plan.



2.     Grant of Restricted Stock Units.



a.     Subject to the terms and conditions set forth in the Plan and this Agreement, the Grantee
shall acquire the number of Restricted Stock Units set forth in the Award Notice, subject to
adjustment by the Committee as provided in Section 5 of the Plan (the “Award”).



b.     The Grantee is not required to make any monetary payment (other than applicable tax
withholding, if any, and payment of the par value of the Stock, if required by law) as a condition
to receiving shares of Stock issued upon settlement of the Restricted Stock Units.



3.     Vesting of Restricted Stock Units. Subject to Paragraph 4 below, the Restricted Stock
Units granted hereunder shall vest in accordance with the Vesting Schedule set forth in the Award
Notice, attached hereto, with accelerated vesting subject to the attainment of the Performance
Goals, if applicable; provided, however, to the extent not already vested, the Restricted Stock
Units shall become 100% vested upon a Change in Control, the Grantee’s death, or the Grantee’s
termination of employment by reason of disability (as defined in the Company’s long-term disability
plan), while employed with the Company.



 









 





4.     Termination of Employment. Notwithstanding any other provision of the Plan to the
contrary, upon the termination of the Grantee’s employment with the Company and its Subsidiaries
for any reason whatsoever (other than death or Disability), the Award, to the extent not yet
vested, shall immediately and automatically terminate; provided, however, that the
Committee may, in its sole and absolute discretion, accelerate the vesting of the Award, upon
termination of employment or otherwise, for any reason or no reason, but shall have no obligation
to do so.



5.     Settlement.



a.     Issuance of Shares of Stock. The Company shall issue to the Grantee, on the Settlement
Date with respect to each Restricted Stock Unit to be settled on such date, shares of Stock that
are equal to the number of vested Restricted Stock Units after any adjustments as provided under
Section 5 of the Plan; provided, however, that the Grantee shall remain required to
remit to the Company such amount that the Company determines is necessary to meet all required
minimum withholding taxes.



b.     Certificate Registration. The certificate for the shares issued in settlement of the
Restricted Stock Units shall be registered in the name of the Grantee, or, if applicable, in the
names of the Grantee’s heirs.



c.     Restrictions on Grant of the Restricted Stock Units and Issuance of Shares. The grant of
the Restricted Stock Units and issuance of shares of Stock upon settlement of the Restricted Stock
Units shall be subject to and in compliance with all applicable requirements of federal, state or
foreign law with respect to such securities. No shares of Stock may be issued hereunder if the
issuance of such shares would constitute a violation of any applicable federal, state or foreign
securities laws or other law or regulations or the requirements of any stock exchange or market
system upon which the Stock may then be listed. The inability of the Company to obtain from any
regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to
be necessary to the lawful issuance of any shares subject to the Restricted Stock Units shall
relieve the Company of any liability in respect of the failure to issue such shares as to which
such requisite authority shall not have been obtained. As a condition to the settlement of the
Restricted Stock Units, the Company may require the Grantee to satisfy any qualifications that may
be necessary or appropriate, to evidence compliance with any applicable law or regulation and to
make any representation or warranty with respect thereto as may be requested by the Company.



d.     Fractional Shares. The Company shall not be required to issue fractional shares upon the
settlement of the Restricted Stock Units.



e.     Dividend Equivalents. As of each dividend payment date for each cash dividend on the
Stock, the Grantee shall receive additional restricted stock units, which shall be subject to the
same terms and conditions as the Restricted Stock Units granted pursuant to the Award Notice and
this Agreement. The number of additional restricted stock units to be granted shall equal: (i) the
product of (x) the per-share cash dividend payable with respect to each share of Stock on that
date, multiplied by (y) the total number of Restricted Stock Units which have



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not been settled or forfeited as of the record date for such dividend, divided by (ii) the
Fair Market Value of one share of Stock on the payment date of such dividend.




6.     Tax Obligations. As a condition to the granting of the Award and the vesting thereof, the
Grantee agrees to remit to the Company or any of its applicable Subsidiaries such sum as may be
necessary to discharge the Company’s or such Subsidiary’s obligations with respect to any tax,
assessment or other governmental charge imposed on property or income received by the Grantee
pursuant to this Agreement and the Award. Accordingly, the Grantee agrees to remit to the Company
or an applicable Subsidiary any and all required minimum withholding taxes. To satisfy such
obligation, Grantee agrees to have the Company withhold a number of whole shares of Stock otherwise
deliverable to Grantee in settlement of the Restricted Stock Units having a Fair Market Value, as
of the date on which the tax withholding obligations arise, not in excess of the amount of such tax
withholding obligations determined by the applicable minimum statutory withholding rates.



7.     No Rights to Continued Employment; Loss of Office. Neither this Agreement nor the Award
shall be construed as giving the Grantee any right to continue in the employ of the Company or any
of its Subsidiaries, or shall interfere in any way with the right of the Company to terminate such
employment. Notwithstanding any other provision of the Plan, the Award, this Agreement or any
other agreement (written or oral) to the contrary, for purposes of the Plan and the Award, a
termination of employment shall be deemed to have occurred on the date upon which the Grantee
ceases to perform active employment duties for the Company following the provision of any
notification of termination or resignation from employment, and without regard to any period of
notice of termination of employment (whether expressed or implied) or any period of severance or
salary continuation. Notwithstanding any other provision of the Plan, the Award, this Agreement or
any other agreement (written or oral) to the contrary, the Grantee shall not be entitled (and by
accepting an Award, thereby irrevocably waives any such entitlement), by way of compensation for
loss of office or otherwise, to any sum or other benefit to compensate the Grantee for the loss of
any rights under the Plan as a result of the termination or expiration of an Award in connection
with any termination of employment. No amounts earned pursuant to the Plan or any Award shall be
deemed to be eligible compensation in respect of any other plan of the Company or any of its
Subsidiaries.



8.     Rights as a Stockholder. The Grantee shall have no rights as a stockholder with respect to
any shares which may be issued in settlement of the Restricted Stock Units until the date of the
issuance of a certificate for such shares (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company). No adjustment shall be made
for dividends, distributions or other rights for which the record date is prior to the date such
certificate is issued, except as provided Section 5 of the Plan and Section 5(e) of this Agreement.



9.     Legends. The Company may at any time place legends referencing any applicable federal,
state or foreign securities law restrictions on all certificates representing shares of Stock
issued pursuant to this Agreement. The Grantee shall, at the request of the Company, promptly
present to the Company any and all certificates representing shares acquired pursuant to this
Agreement in the possession of the Grantee in order to carry out the provisions of this Section.



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10.     Nontransferability of Restricted Stock Units. Prior to the issuance of shares of Stock on
the Settlement Date, neither this Agreement nor any of the Restricted Stock Units subject to this
Agreement shall be subject in any manner to anticipation, alienation, sale, exchange, transfer,
assignment, pledge, encumbrance, or garnishment by creditors of the Grantee, except transfer by
will or by the laws of descent and distribution. All rights with respect to the Agreement shall be
exercisable during the Grantee’s lifetime only by the Grantee or the Grantee’s guardian or legal
representative.



11.     Amendments. The Committee may amend this Agreement at any time; provided, however, that
no such amendment may adversely affect the Grantee’s rights under this Agreement without the
consent of the Grantee, except to the extent such amendment is reasonably determined by the
Committee in its sole discretion to be necessary to comply with applicable law or to prevent a
detrimental accounting impact. No amendment or addition to this Agreement shall be effective
unless in writing.



12.     Notices. Any notice required or permitted under this Agreement shall be deemed given when
delivered personally, or when deposited in a United States Post Office, postage prepaid, addressed,
as appropriate, to the Grantee at the last address specified in the Grantee’s employment records,
or such other address as the Grantee may designate in writing to the Company, or the Company,
Attention: General Counsel, or such other address as the Company may designate in writing to the
Grantee.



13.     Binding Effect. This Agreement shall inure to the benefit of the successors and assigns
of the Company and, subject to the restrictions on transfer set forth herein, be binding upon the
Grantee and the Grantee’s heirs, executors, administrators, successors and assigns.



14.     Failure to Enforce Not a Waiver. The failure of the Company to enforce at any time any
provision of this Agreement shall in no way be construed to be a waiver of such provision or of any
other provision hereof.



15.     Integrated Agreement. The Award Notice, this Agreement and the Plan constitute the entire
understanding and agreement of the Grantee and the Company with respect to the subject matter
contained herein or therein and supersedes any prior agreements, understandings, restrictions,
representations, or warranties among the Grantee and the Company with respect to such subject
matter other than those as set forth or provided for herein or therein. To the extent contemplated
herein or therein, the provisions of the Award Notice and the Agreement shall survive any
settlement of the award and shall remain in full force and effect.



16.     Governing Law. This Agreement and the legal relations between the parties shall be
governed by and construed in accordance with the internal laws of the State of Maryland, without
effect to the conflicts of laws principles thereof.



17.     Authority. The Committee shall have full authority to interpret and construe the terms of
the Plan, the Award Notice, and this Agreement. The determination of the Committee as to any such
matter of interpretation or construction shall be final, binding and conclusive on all parties.



*       *       *       *       *


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