Exhibit 10.3


 


ACTIVISION, INC.


 


RESTRICTED STOCK AWARD AGREEMENT


 


 


You
have been awarded restricted shares of the Company’s common stock, $0.000001
par value per share (“Restricted Stock”), subject to the following terms and
conditions:


 


	
  •                  Name of Grantee:

  	
   

  	
  Thomas Tippl

  
	
   

  	
   

  	
   

  
	
  •                  Total Number of Shares of Restricted Stock
  Awarded:

  	
   

  	
  72,534(1)

  
	
   

  	
   

  	
   

  
	
  •                  Date of Grant:

  	
   

  	
  October 3, 2005

  



 


•                  This
award of Restricted Stock is being made pursuant to and as a material
inducement for the Grantee to enter into an employment agreement dated September 9,
2005 (the “Employment Agreement”) and is governed by the terms of the
Employment Agreement and the terms of the Restricted Stock Award Terms attached
hereto as Exhibit A.  In addition,
this award of Restricted Stock is granted under and subject to the terms and
conditions of the Company’s 2003 Incentive Plan (the “Plan”), the terms,
conditions and definitions of which are hereby incorporated herein as though
set forth at length, and the receipt of a copy of which the Grantee hereby
acknowledges by his signature on the irrevocable stock attached hereto as Exhibit B.  Capitalized terms used herein shall have the
meanings set forth in the Plan, unless otherwise defined herein.


 


•                  This
award of Restricted Stock is conditioned upon your endorsement in blank of the
irrevocable stock power attached hereto as Exhibit B.  If you do not return the attached irrevocable
stock power within sixty (60) days from the Date of Grant, this award shall be
deemed forfeited.  As such, promptly
endorse and return the attached irrevocable stock power to the General Counsel
at the following address:


 


Activision, Inc.


3100 Ocean Park Boulevard


Santa Monica, CA 
90405


Attn:  General
Counsel


 


•                  If
you wish to elect a designated beneficiary to whom shares of common stock
otherwise due to you pursuant to the terms of this award shall be distributed
in the event of your death prior to distribution, please complete and return to
the General Counsel along with your irrevocable stock power the beneficiary
designation form attached hereto as Exhibit C.


 


	
  Dated: October 3, 2005

  	
  ACTIVISION, INC.

  
	
   

  	
   

  
	
  Accepted and Agreed:

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title: Sr. Vice President, General Counsel

  
	
  THOMAS TIPPL

  	
   

  
				



 










(1)  Amount equal to
$1,500,000 divided by the closing price of ATVI stock as reported on closing on
NASDAQ on October 3, 2005.


 





















 


EXHIBIT A


 


ACTIVISION, INC.


 


RESTRICTED STOCK AWARD TERMS


 


Activision, Inc., a Delaware corporation (“Company”),
has granted you (“Grantee”) an award of restricted stock pursuant to the terms
and conditions set forth in your Notice of Restricted Stock Award (“Grant
Notice”), these Restricted Stock Award Terms (“Award Terms”) and your
Employment Agreement (defined in the Grant Notice).  In addition, this award of Restricted Stock is subject to the terms and
conditions of the Company’s 2003 Incentive Plan (the “Plan”), the terms,
conditions and definitions of which are hereby incorporated herein as though
set forth at length, and the receipt of a copy of which the Grantee hereby
acknowledges by his signature on the irrevocable stock power attached to the
Grant Notice as Exhibit B. 
Capitalized terms used herein shall have the meanings set forth in the
Plan, unless otherwise defined herein.  The
text of the Plan and the Grant Notice are incorporated herein by reference and
made a part of these Award Terms.


 


1.                                       Definitions.  For purposes of this Award, the following
terms shall have the meanings set forth below:


 


“Anniversary
Date” means the annual anniversary of the Date of Grant.


 


“Award”
means this Restricted Stock Award.


 


“Board” means the Board of
Directors of the Company.


 


“Code”
means the Internal Revenue Code of 1986, as amended, and regulations
thereunder.


 


“Committee”
means the Compensation Committee of the Board or such other Board committee
designated by the Board in accordance with the Plan.


 


“Common
Stock” means the Company’s common stock, $0.000001 par value
per share.


 


“Company”
means Activision, Inc. and any successor thereto.


 


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


 


“Disability”
shall have the meaning set forth in the Employment Agreement.


 


“Grant
Notice” means the Notice of Restricted Stock Award
accompanying these Award Terms.


 


“Plan”
means the Activision, Inc. 2003 Incentive Plan, as amended from time to
time.


 


“Restricted
Shares” means shares of Common Stock subject to the Award
which are subject to the Restrictions. 
This amount shall include any additional shares of Common Stock


 


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resulting from the investment
of dividends declared on existing Restricted Shares pursuant to Section 6
hereof and additional or different securities issued as a result of any
adjustment pursuant to Section 10 hereof.


 


“Restrictions”
means the restrictions set forth in Section 3 hereof which are imposed on
shares of Common Stock subject to this Agreement prior to vesting.


 


“Vested
Shares” means the shares of Common Stock subject to this
Agreement which have become vested pursuant to Section 4 or 5 hereof and
are, therefore, no longer subject to the Restrictions.


 


2.                                       Grant
of Restricted Stock.  Pursuant to
action of the Board and in accordance with the Employment Agreement, the
Company hereby awards to Grantee the number of shares of Common Stock as set
forth on the Grant Notice.


 


3.                                       Restrictions.  From the Date of Grant until the date Grantee
obtains a vested right to shares of Common Stock subject to this Award pursuant
to Section 4, 5 or 10 hereof, neither the shares of Common Stock subject
to this Award (including any additional shares resulting from the reinvestment
of dividends declared on the original shares awarded or an adjustment of the
original shares pursuant to Section 10 hereof) nor any right or privilege
pertaining thereto may be sold, assigned, transferred, pledged, hypothecated or
otherwise disposed or encumbered in any way, otherwise than by transfer to a
trust in accordance with Section 15 hereof, and shall not be subject to
execution, attachment or similar process (collectively, the “Restrictions”).  Any attempt to sell, transfer, assign,
pledge, hypothecate or otherwise dispose of or encumber the Restricted Shares
or any right or privilege pertaining thereto, otherwise than by transfer to a
trust pursuant to Section 16 hereof, shall be null and void and of no
force and effect.  Upon the lapse of the
Restrictions with respect to any shares of Common Stock subject to this Award,
Grantee shall obtain a vested right to such shares of Common Stock.


 


4.                                      Vesting.  Except as otherwise provided in Section 5
or 10, on each Anniversary Date beginning with the third Anniversary Date
through and including the fifth Anniversary Date that Grantee remains in
continuous employment with the Company or any of its subsidiaries or
affiliates, the Restrictions shall lapse with respect to one-third of the
original number of Restricted Shares set forth on the Grant Notice, as adjusted
to account for additional shares of Common Stock resulting from dividend
reinvestment pursuant to Section 6 hereof or any adjustment pursuant to Section 9
hereof.  Fractional shares shall be
rounded up to the nearest whole share of Common Stock (for which purpose
one-half share shall be rounded up to the nearest whole share of Common
Stock).  Upon termination of Grantee’s
employment with the Company and its subsidiaries and affiliates THE FOLLOWING PROVISIONS WILL APPLY:


 


Restricted Shares will
vest ratably over the third, fourth and fifth years following the Effective
Date, with one third of the amount granted vesting at the end of each of the
third, fourth and fifth years following the Effective Date.  In
the event of Grantee’s termination, the provisions of Paragraph 9 of the
Employment Agreement will govern vesting.


 


5.                                       Tax
Withholding. Upon the lapse of the Restrictions (or any such earlier time,
if any, that an election is made under Section 83(b) of the Code, or
any successor provision thereto, to include the value of such shares in taxable
income), the Company shall be entitled to withhold from


 


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Grantee’s compensation
any required taxes, including, but not limited to, Grantee’s social security
and Medicare taxes and federal, state and local income tax with respect to the
income arising from the lapse of the Restrictions.  The Company shall have the right to require
the payment of any such taxes before delivering the stock certificate with
respect to the Vested Shares and the related stock power held by the Company in
accordance with Section 6 hereof. 
Alternatively, in lieu of such withholding, Grantee shall be entitled to
cover all or any part of the taxes arising from the lapse of the Restrictions
through a reduction of the number of Vested Shares delivered to Grantee or a
delivery, or tender, to the Company of shares of Common Stock already held by
Grantee, in each case valued in the same manner as used in computing
withholding taxes under the applicable laws. 
Additionally, to the extent it is determined by a regulatory agency or a
court of competent jurisdiction that shares of Common Stock which would otherwise
be considered Restricted Shares pursuant to the terms of the Award nevertheless
result in current federal or state taxation, (i) all Restrictions as to
such shares shall immediately lapse, (ii) such shares shall immediately
become Vested Shares and (iii) Grantee shall be entitled to cover all or
any part of the taxes through a reduction of such Restricted Shares resulting
in the taxable event.


 


6.                                       Custody,
Voting and Dividends.  Restricted
Shares shall be held in certificated form by the Company or its agent for
Grantee’s account, with appropriate notation of the Restrictions made in the
Company’s records and on the certificate for the Restricted Shares.  Additionally, the grant of Restricted Shares
is conditioned upon Grantee’s endorsement in blank of the irrevocable stock
power attached to the Grant Notice as Exhibit B.  The irrevocable stock power must be endorsed
and returned to the General Counsel within sixty (60) days from the Date of
Grant.  Failure to do so within the
prescribed time period will result in an immediate forfeiture of the Restricted
Shares.  At the option of the Grantee,
any dividends declared on Restricted Shares shall be reinvested in additional
shares of Common Stock (in accordance with such methods or procedures as shall
be established from time to time by the Committee), which shall vest
concurrently with the Restricted Shares, or shall be paid to the Grantee
concurrently with the payment of such dividends to all other record holders of
Common Stock.  To the extent the Restricted
Shares have not been forfeited, Grantee shall be entitled to voting privileges
associated with the Restricted Shares.


 


7.                                       Lapse
of Restrictions.  If, and when, the
Restrictions lapse, the Company shall distribute certificates for such Vested
Shares to the Grantee, which will not bear any restrictive legend other than
such legends as may be required pursuant to applicable securities or blue sky
laws.  Additionally, the Company will
deliver to Grantee no later than thirty (30) days following the lapse of such
Restrictions the related irrevocable stock power held by the Company pursuant
to Section 6 hereof.


 


8.                                       Committee
Discretion.  The Committee shall have
plenary authority to (a) interpret any provision of these Award Terms, (b) make
any determinations necessary or advisable for the administration of the Award,
and (c) waive any conditions or rights under the Award, or amend, alter,
accelerate, suspend, discontinue or terminate the Award; provided, however,
that, except as provided in Section 9 hereof, without the consent of
Grantee, no such amendment, alteration, suspension, discontinuation or
termination of this Award may impair the rights of Grantee with the Award or
modify the Award in any way materially inconsistent with the terms of
Employment Agreement.


 


9.                                       Adjustments.  Notwithstanding anything to the contrary
herein, in the event that the Committee shall determine that any dividend or
other distribution (whether in the form of cash,


 


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shares or other
property), recapitalization, stock split, reverse stock split, reorganization,
merger, consolidation, spin-off, combination, repurchase, or share exchange, or
other similar corporate transaction or event, affects the Restricted Shares
such that an adjustment is determined by the Committee to be appropriate in
order to prevent dilution or enlargement of the rights of Grantee under this
Award, then the Committee shall, in such manner as it may deem equitable, make
any adjustments to the Award it deems appropriate.  In addition, the Committee is authorized to
make such adjustments as it deems appropriate in the terms and conditions of,
and the criteria included in, the Award in recognition of unusual or
nonrecurring events (including, without limitation, events described in the
preceding sentence) affecting the Company or any subsidiary or affiliate or the
financial statements of the Company or any subsidiary or affiliate, or in
response to changes in applicable laws, regulations or accounting principles.


 


10.                                 Postponement;
Registration.  The Company may
postpone the issuance and delivery of Restricted Shares until (a) the
admission of such Restricted Shares to listing on any stock exchange or
exchanges on which Common Stock of the Company are then listed and (b) the
completion of such registration or other qualification of such Restricted
Shares under any state or federal law, rule or regulation as the Company
shall determine to be necessary or advisable. 
The Grantee shall make such representations and furnish such information
as may, in the opinion of counsel for the Company, be appropriate to permit the
Company, in light of the then existence or non-existence with respect to such
Restricted Shares of an effective Registration Statement under the Securities Act
of 1933, as amended, to issue the Restricted Shares in compliance with the
provisions of that or any comparable act. 
The Company shall have the right to register the Restricted Shares on a Form S-8
or S-3 to facilitate their resale by the Grantee. The Company may not postpone
the issuance and delivery of Restricted Shares up to an amount equal to the
taxes payable as a result of the vesting of Restricted Shares.


 


11.                                 Beneficiary
Designations.  Grantee shall file
with the Executive Vice President of Human Resources on the form attached to
the Grant Notice as Exhibit C,
or such other form as may be prescribed by the Company, a designation of a
primary beneficiary(ies) and a contingent beneficiary(ies) to whom shares of
Common Stock otherwise due to Grantee pursuant to the terms hereof shall be
distributed in the event of the death of Grantee prior to distribution.  Grantee shall have the right to change the
beneficiary from time to time; provided, however, that any change shall not
become effective until received in writing by the secretary of the Company or
its designee.  If any designated
beneficiary survives Grantee but dies before receiving all of Grantee’s
benefits hereunder to which he or she is entitled, any remaining benefits due
Grantee to which the deceased beneficiary is entitled shall be distributed to
the deceased beneficiary’s estate.  If
there is no effective beneficiary designation on file at the time of Grantee’s
death, or if the designated primary beneficiary(ies) and contingent
beneficiary(ies) predecease Grantee, the payment of benefits shall be made to
Grantee’s estate.


 


12.                                 Legend.  The Company may cause the following or a
similar legend to be set forth on each certificate representing Restricted
Shares or any other security issued unless counsel for the Company is of the
opinion as to any such certificate that such legend is unnecessary:


 


THE SECURITIES
REPRESENTED BY THIS CERTIFICATE 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


 


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ACT, THE AVAILABILITY OF
WHICH IS ESTABLISHED BY AN OPINION FROM COUNSEL TO THE COMPANY.


 


13.                                 No
Right to Continued Employment. 
Nothing in these Award Terms shall be deemed to create any limitation or
restriction on such rights as the Company otherwise would have to terminate the
employment of Grantee at any time for any reason.


 


14.                                 Governing
Law.  To the extent federal law does
not otherwise control, the validity, interpretation, performance and
enforcement of this Award shall be governed by the laws of the State of
California, without giving effect to principles of conflicts of laws thereof.


 


15.                                 Successors
and Assigns.  The provisions of this
Award 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
legal representative.  Grantee may transfer
Restricted Shares to the trustee of a trust only to the extent approved in
advance by the Committee (or its designee), in its sole discretion, and the
Restricted Shares are held by such trustee subject to all the terms and
conditions set forth in this Award. 
Furthermore, as a condition to transfer, the Committee (or its designee)
shall have the authority to require the trustee to execute any documentation
deemed appropriate by the Committee (or its designee) to ensure the Restricted
Shares will continue to be subject to the terms and conditions set forth in
this Award.


 


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EXHIBIT B


 


IRREVOCABLE STOCK POWER


 


FOR VALUE RECEIVED, and pursuant to the Restricted
Stock Award dated as of                                   
(the “Award”), the undersigned does hereby sell, assign, transfer and convey to


 


Activision, Inc.
(the “Company”)                                 
shares of Activision, Inc. common stock, $0.000001 par value, represented
by Certificate(s) No.                            ,
and hereby irrevocably constitutes and appoints                                           
to transfer said stock on the books of the Company, with full power of
substitution in the premises.


 


	
   

  	
   

  	
   

  	
   

  	
   

  
	
  First Name

  	
  Middle Name

  	
  Last Name

  	
   

  	
  Date

  



 


Instructions:
Please do not fill in any blanks other than the signature
line.  The purpose of this irrevocable
stock power is to enable the Company to exercise full ownership and control
over the restricted stock subject to the Award in the event of forfeiture.


 


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EXHIBIT C


 


ACTIVISION, INC.


 


Restricted Stock Award dated as of                      ,
20       


 


Designation of Beneficiary


 


	
  I,

  	
   

  	
  (“Grantee”),
  hereby designate

  
	
   

  	
   

  	
   

  	
   

  
	
  PRIMARY

  	
   

  	
   

  	
   

  
	
  (Print
  Beneficiary’s Name)

  	
  Last

  	
  First

  	
  Middle Initial

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print
  Beneficiary’s Address

  	
   

  	
   

  	
  Relationship

  
	
   

  	
   

  	
   

  	
   

  
	
  PRIMARY

  	
   

  	
   

  	
   

  
	
  (Print
  Beneficiary’s Name)

  	
  Last

  	
  First

  	
  Middle Initial

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print
  Beneficiary’s Address

  	
   

  	
   

  	
  Relationship

  
						



 


as my primary beneficiary(ies)
for purposes of the above-referenced award (“Award”). In the event of my death
prior to the distribution of all shares of Common Stock otherwise due to me
pursuant to the Award, such primary beneficiary(ies) shall receive the
remaining amount in equal shares.  If
none of the above-named primary beneficiary(ies) survive me, the remaining
amount of shares of Common Stock shall be distributed in equal shares to those
then living of the following person(s):


 


	
  SECONDARY

  	
   

  	
   

  	
   

  
	
  (Print
  Beneficiary’s Name)

  	
  Last

  	
  First

  	
  Middle Initial

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print
  Beneficiary’s Address

  	
   

  	
   

  	
  Relationship

  
	
   

  	
   

  	
   

  	
   

  
	
  SECONDARY

  	
   

  	
   

  	
   

  
	
  (Print
  Beneficiary’s Name)

  	
  Last

  	
  First

  	
  Middle Initial

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print
  Beneficiary’s Address

  	
   

  	
   

  	
  Relationship

  



 


It is understood that
this Designation of Beneficiary is made pursuant to the Award and is subject to
the conditions stated therein.  It is
further understood that all prior designations of beneficiary under the Award
are hereby revoked and that this Designation of Beneficiary may only be revoked
in writing, signed by Grantee and filed with the Company prior to Grantee’s
death.


 


	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
  Grantee

  
	
   

  	
   

  
	
  ACKNOWLEDGED
  AND ACCEPTED BY THE COMPANY:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
  Signature of
  Company Representative

  



 


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