Exhibit 10.28


    Exhibit
      10.28

    


    STRATUS
      PROPERTIES INC.

    


    RESTRICTED
      STOCK UNIT AGREEMENT

    UNDER
      THE 2002 STOCK INCENTIVE PLAN

    


    AGREEMENT
      dated as of ______________, 20__ (the “Grant Date”), between Stratus Properties
      Inc., a Delaware corporation (the “Company”), and ______________ (the
“Participant”).

     

    1.     (a)      Pursuant
      to the Stratus Properties Inc. 2002 Stock Incentive Plan (the “Plan”), the
      Participant is hereby granted effective the Grant Date ___________ restricted
      stock units (“Restricted Stock Units” or “RSUs”) on the terms and conditions set
      forth in this Agreement and in the Plan.

     

    (b)  Defined
      terms not otherwise defined herein shall have the meanings set forth in Section
      2 of the Plan.

     

    (c)  Subject
      to the terms, conditions, and restrictions set forth in the Plan and herein,
      each RSU granted hereunder represents the right to receive from the Company,
      on
      the respective scheduled vesting date for such RSU set forth in Section 2(a)
      of
      this Agreement or on such earlier date as provided in Section 2(b) of this
      Agreement or Section 6(b) of this Agreement (the “Vesting Date”), one share (a
“Share”) of Common Stock of the Company (“Common Stock”), free of any
      restrictions, all amounts notionally credited to the Participant’s Dividend
      Equivalent Account (as defined in Section 4 of this Agreement) with respect
      to
      such RSU, and all securities and property comprising all Property Distributions
      (as defined in Section 4 of this Agreement) deposited in such Dividend
      Equivalent Account with respect to such RSU.

     

    (d)  As
      soon
      as practicable after the Vesting Date (but no later than 2 1⁄2 months from such
      date) for any RSUs granted hereunder, the Participant shall receive from the
      Company the number of Shares to which the vested RSUs relate, free of any
      restrictions, a cash payment for all amounts notionally credited to the
      Participant’s Dividend Equivalent Account with respect to such vested RSUs
      (unless the receipt of such Shares and amounts has been deferred by the
      Participant pursuant to the provisions of Section 5(a) of this Agreement),
      and
      all securities and property comprising all Property Distributions deposited
      in
      such Dividend Equivalent Account with respect to such vested RSUs.

     

    2.     (a)       The
      RSUs
      granted hereunder are in consideration of the services to be performed by the
      Participant during the service periods indicated below and shall vest in
      installments as follows:

     

    Scheduled
      Vesting Date Service
      Period  Number
      of RSUs

     

    


    


    


    


    


    (b)  Notwithstanding
      Section 2(a) of this Agreement, at such time as there shall be a Change in
      Control of the Company, all unvested RSUs shall be accelerated and shall
      immediately vest.

     

    (c)  Until
      the
      respective Vesting Date for an RSU granted hereunder, such RSU, all amounts
      notionally credited in any Dividend Equivalent Account related to such RSU,
      and
      all securities or property comprising all Property Distributions deposited
      in
      such Dividend Equivalent Account related to such RSU shall be subject to
      forfeiture as provided in Section 6 of this Agreement.

     

    3.  Except
      as
      provided in Section 4 of this Agreement, an RSU shall not entitle the
      Participant to any incidents of ownership (including, without limitation,
      dividend and voting rights) in any Share until the RSU shall vest and the
      Participant shall be issued the Share to which such RSU relates nor in any
      securities or property comprising any Property Distribution deposited in a
      Dividend Equivalent Account related to such RSU until such RSU
      vests.

     

    4.  From
      and
      after the Grant Date of an RSU until the issuance of the Share payable in
      respect of such RSU, the Participant shall be credited, as of the payment date
      therefor, with (i) the amount of any cash dividends and (ii) the amount equal
      to
      the Fair Market Value of any Shares, Subsidiary securities, other securities,
      or
      other property distributed or distributable in respect of one share of Common
      Stock to which the Participant would have been entitled had the Participant
      been
      a record holder of one share of Common Stock at all times from the Grant Date
      to
      such issuance date (a “Property Distribution”). All such credits shall be made
      notionally to a dividend equivalent account (a “Dividend Equivalent Account”)
      established for the Participant with respect to all RSUs granted hereunder
      with
      the same Vesting Date. All credits to a Dividend Equivalent Account for the
      Participant shall be notionally increased by the Account Rate (as hereinafter
      defined), compounded quarterly, from and after the applicable date of credit
      until paid in accordance with the provisions of this Agreement. The “Account
      Rate” shall be the prime commercial lending rate announced from time to time by
      The Chase Manhattan Bank, N.A. or by another major national bank headquartered
      in New York, New York designated by the Committee. The Committee may, in its
      discretion, deposit in the Participant’s Dividend Equivalent Account the
      securities or property comprising any Property Distribution in lieu of crediting
      such Dividend Equivalent Account with the Fair Market Value
      thereof.

     

    5.    (a)    
      Notwithstanding
      the provisions of Section 1(d) of this Agreement, if, prior to December
      31st
      of the
      year prior to the beginning of the Service Period applicable to any RSUs, the
      Participant shall so elect in accordance with procedures and subject to any
      limitations established by the Committee, all or a portion of the Shares
      issuable to the Participant upon the vesting of such RSUs and all or a portion
      of the amounts notionally credited in the Dividend Equivalent Account related
      to
      such RSUs shall not be distributed on the Vesting Date but shall be deferred
      and
      paid in one or more periodic installments, not in excess of ten, beginning
      at
      such time or times elected by the Participant at such time. The deferral is
      subject to the following limitations: 

     

    (i)  If
      the
      Participant is a Key Employee, a distribution of deferred amounts triggered
      by
      the Participant’s separation from service (as that term is defined pursuant to
      Section 409A of the Code) may not occur or begin until six months after the
      date
      (the “Termination Date”) the Participant ceases to be an Eligible Individual
      (the “Termination”).

     

    (ii)  The
      deferral period with respect to any Participant shall
      end
      no later than six months after the Termination Date if the Participant’s
      Termination is for any reason other than the Participant’s Disability or
      Retirement.

     

    (iii)  The
      deferral period with respect to any Participant shall end three years after
      the
      Termination Date if the Participant’s Termination occurs by reason of the
      Participant’s Disability or Retirement. 

     

    (iv)  In
      the
      event of any Termination, a distribution of all amounts remaining unpaid shall
      be made in full to the Participant or his or her designated beneficiary as
      soon
      as administratively possible following the date of the end of the deferral
      period as set forth in Sections 5(a)(ii) and (iii). 

     

    (v)  All
      securities or property comprising Property Distributions deposited in such
      Dividend Equivalent Account related to such RSUs shall be distributed to the
      Participant as soon as practicable after the Vesting Date for such RSUs,
      irrespective of a deferral election made pursuant to this Section
      5.

     

    (vi)  The
      deferral procedures described in this Section 5 are intended to comply with
      the
      requirements of Section 409A of the Code and any related implementing
      regulations or guidance. 

     

    (b)  The
      provisions of Section 4 shall continue to apply to all such vested RSUs and
      all
      such credited amounts subject to a deferral election until paid in accordance
      with the provisions of this Agreement.

     

    6.     (a)      
      Except
      as
      set forth in Section 6(b) of this Agreement, all unvested RSUs provided for
      in
      this Agreement, all amounts credited to the Participant’s Dividend Equivalent
      Accounts with respect to such RSUs, and all securities and property comprising
      Property Distributions deposited in such Dividend Equivalent Accounts with
      respect to such RSUs shall immediately be forfeited on the Participant’s
      Termination Date. In the event of a sale by the Company of its equity interest
      in a Subsidiary following which such entity is no longer a Subsidiary of the
      Company, persons who continue to be employed by such entity following such
      sale
      shall cease to be Eligible Individuals for purposes of the Plan and this
      Agreement.

     

    (b)  Notwithstanding
      the foregoing, if the Participant ceases to be an Eligible Individual by reason
      of the Participant’s death, Disability, or Retirement, all the unvested RSUs
      granted hereunder, all amounts credited to the Participant’s Dividend Equivalent
      Accounts with respect to such RSUs, and all securities and property comprising
      Property Distributions deposited in such Dividend Equivalent Accounts with
      respect to such RSUs shall vest as of the Participant’s Termination Date. In the
      event that the Participant ceases to be an Eligible Individual by reason of
      the
      Participant’s Termination by his employer or principal without Cause, the
      Committee or any person to whom the Committee has delegated authority may,
      in
      its or his sole discretion, determine that all or any portion of the unvested
      RSUs granted hereunder, all amounts credited to the Participant’s Dividend
      Equivalent Accounts with respect to such RSUs, and all securities and property
      comprising Property Distributions deposited in such Dividend Equivalent Accounts
      with respect to such RSUs shall vest as of the Participant’s Termination Date.
      In the event vesting is accelerated pursuant to this Section 6(b) and the
      Participant is a Key Employee, a distribution of Shares issuable to the
      Participant, all amounts notionally credited to the Participant’s Dividend
      Equivalent Account, and all securities and property comprising all Property
      Distributions deposited in such Dividend Equivalent Account due the Participant
      upon the vesting of the RSUs shall not occur until six months after the
      Termination Date, unless the Participant’s Termination is due to death or
      Disability.

     

    7.  The
      RSUs
      granted hereunder, any amounts notionally credited in the Participant’s Dividend
      Equivalent Accounts, and any securities and property comprising Property
      Distributions deposited in such Dividend Equivalent Accounts are not
      transferable by the Participant otherwise than by will or by the laws of descent
      and distribution or pursuant to a domestic relations order, as defined in the
      Code.

     

    8.  All
      notices hereunder shall be in writing and, if to the Company, shall be delivered
      personally to the Secretary of the Company or mailed to its principal office,
      1615 Poydras Street, New Orleans, Louisiana 70112, addressed to the attention
      of
      the Secretary; and, if to the Participant, shall be delivered personally or
      mailed to the Participant at the address on file with the Company. Such
      addresses may be changed at any time by notice from one party to the
      other.

     

    9.  This
      Agreement is subject to the provisions of the Plan. The Plan may at any time
      be
      amended by the Board, except that any such amendment of the Plan that would
      materially impair the rights of the Participant hereunder may not be made
      without the Participant’s consent. The Committee may amend this Agreement at any
      time in any manner that is not inconsistent with the terms of the Plan and
      that
      will not result in the application of Section 409A(a)(1) of the Code.
      Notwithstanding the foregoing, no such amendment may materially impair the
      rights of the Participant hereunder without the Participant’s consent. Except as
      set forth above, any applicable determinations, orders, resolutions or other
      actions of the Committee shall be final, conclusive and binding on the Company
      and the Participant.

     

    10.  The
      Participant is required to satisfy any obligation in respect of withholding
      or
      other payroll taxes resulting from the vesting of any RSU granted hereunder
      or
      the payment of any securities, cash, or property hereunder, in accordance with
      procedures established by the Committee, as a condition to receiving any
      securities, cash payments, or property resulting from the vesting of any RSU
      or
      otherwise.

     

    11.  Nothing
      in this Agreement shall confer upon the Participant any right to continue in
      the
      employ of the Company or any of its Subsidiaries, or to interfere in any way
      with the right of the Company or any of its Subsidiaries to terminate the
      Participant’s employment relationship with the Company or any of its
      Subsidiaries at any time.

     

    12.  As
      used
      in this Agreement, the following terms shall have the meanings set forth
      below.

     

    (a)  “Cause”
      shall mean any of the following: (i) the commission by the Participant of an
      illegal act (other than traffic violations or misdemeanors punishable solely
      by
      the payment of a fine), (ii) the engagement of the Participant in dishonest
      or
      unethical conduct, as determined by the Committee or its designee, (iii) the
      commission by the Participant of any fraud, theft, embezzlement, or
      misappropriation of funds, (iv) the failure of the Participant to carry out
      a
      directive of his superior, employer or principal, or (v) the breach of the
      Participant of the terms of his engagement.

     

    (b)  “Change
      in Control” shall mean a change in the ownership of the Company, a change in the
      effective control of the Company or a change in the ownership of a substantial
      portion of the assets of the Company as provided under Section 409A of the
      Code,
      as amended from time to time, and any related implementing regulations or
      guidance.

     

    (c)  “Disability”
      shall have occurred if the Participant is (i) unable to engage in any
      substantial gainful activity by reason of any medically determinable physical
      or
      mental impairment which can be expected to result in death or can be expected
      to
      last for a continuous period of not less than 12 months, or (ii) by reason
      of
      any medically determinable physical or mental impairment which can be expected
      to result in death or can be expected to last for a continuous period of not
      less than 12 months, receiving income replacement benefits for a period of
      not
      less than 3 months under an accident and health plan covering employees of
      the
      Participant’s employer.

     

    (d)  “Fair
      Market Value” shall, with respect to a share of Common Stock, a Subsidiary
      security, or any other security, have the meaning set forth in the Stratus
      Properties Inc. 2002 Stock Incentive Plan Policies of the Committee, and, with
      respect to any other property, mean the value thereof determined by the board
      of
      directors of the Company in connection with declaring the dividend or
      distribution thereof.

     

    (e)  “Key
      Employee” shall mean any employee who meets the definition of “key employee” as
      defined in Section 416(i) of the Code.

     

    (f)  “Retirement”
      shall mean early, normal or deferred retirement of the Participant under a
      tax
      qualified retirement plan of the Company or any other cessation of the provision
      of services to the Company or a Subsidiary by the Participant that is deemed
      by
      the Committee or its designee to constitute a retirement. 

     


    IN
      WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
      day,
      month, and year first above written.

    


    STRATUS
      PROPERTIES INC.

    


    


    By:
       ____________________________________

    


    


    ____________________________________

    (Participant)

    


    ____________________________________

    (Street
      Address)

    


    


    ____________________________________

    (City)
      (State) (Zip Code)