Document:

EX-10.67

 Exhibit 10.67 

FORM OF LTIP UNIT VESTING AGREEMENT 

LTIP UNIT VESTING AGREEMENT 

UNDER THE MORGANS HOTEL GROUP CO. 

AMENDED AND RESTATED 2007 OMNIBUS INCENTIVE PLAN 
  

			
	Name of Grantee:	  	(“Grantee”)
	No. of LTIP Units:	  	
	Grant Date:	  	(the “Grant Date”)
	Final Acceptance Date:	  	(the “Final Acceptance Date”)

 Pursuant to the Morgans Hotel Group Co. Amended and Restated 2007 Omnibus Incentive Plan (the
“Plan”) of Morgans Hotel Group Co. (the “Company”) a Delaware corporation, and the Limited Liability Company Agreement (the “LLC Agreement”) of Morgans Group LLC (the “LLC”), a Delaware limited liability
company, the LLC hereby grants to the Grantee named above an Other Stock-Based Award (as defined in the Plan, referred to herein as an “Award”) in the form of, and by causing the LLC to issue to the Grantee, the number of LTIP Units (as
defined in the LLC Agreement) set forth above (the “Award LTIP Units”) having the rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption and conversion set forth herein
and in the LLC Agreement. Upon the close of business on the Final Acceptance Date, if this LTIP Unit Vesting Agreement (this “Agreement”) is accepted, the Grantee shall receive the number of LTIP Units specified above, subject to the
restrictions and conditions set forth herein, in the Plan and in the LLC Agreement. Unless otherwise indicated, capitalized terms used herein but not defined shall have the meanings given to those terms in the Plan. 

1. Acceptance of Agreement. 

(a) Unless the Grantee is already a Member (as defined in the LLC Agreement), Grantee must sign, as a Member, and deliver to the LLC a
counterpart signature page to the LLC Agreement (attached hereto as Exhibit A). Upon signing and delivery of the signature page, to the extent required, the Grantee shall be admitted as a Member of the LLC, as of the Grant Date, with
beneficial ownership of the number of LTIP Units specified above, the LLC Agreement shall be amended to reflect the issuance to the Grantee of the Award LTIP Units and the LLC shall deliver to the Grantee a certificate of the Company certifying the
number of LTIP Units then issued to the Grantee. Thereupon, the Grantee shall have all the rights of a Member of the LLC with respect to the number of LTIP Units specified above, as set forth in the LLC Agreement, subject, however, to the
restrictions and conditions specified herein and in the LLC Agreement. 
 (b) In order to confirm receipt of this Agreement, Grantee must
sign and deliver to the Company a copy of this Agreement. 

 2. Vesting of LTIP Units. 

(a) Except as provided in Sections 2(b) and 2(c) below, the Award LTIP Units shall vest one-third (1/3) each year on each of the first
three one-year anniversaries of the Grant Date (each such date on which Award LTIP Units vest is referred to herein as a “Vesting Date”); provided that upon termination of Grantee’s employment with, cessation of consulting
relationship with or cessation of service to the Company and its Subsidiaries for any reason, the LTIP Units that have not yet vested shall, without payment of any consideration by the LLC, automatically and without notice terminate, be forfeited
and be and become null and void, and neither the Grantee nor any of his successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in such LTIP Units. In the event Grantee becomes a consultant,
advisor or Non-Employee Director, such change in status shall not be deemed a termination of employment or service with the Company at the time of such change in status or thereafter so long as the Grantee continues in one of such positions. 

(b) Notwithstanding any other term or provision of this Agreement, if a Corporate Transaction occurs and the LTIP Units subject to this
Agreement are not assumed or substituted for, or if assumed or substituted for, upon the Grantee’s Involuntary Termination within the 12 month period following the Corporate Transaction, any restrictions and conditions on all LTIP Units subject
to this Agreement shall be deemed waived by the Company and all LTIP Units granted hereby that have not previously been forfeited shall automatically become fully vested. Notwithstanding any other provision in this Agreement, if assumed or
substituted for, but subject to Section 2(c), the award will expire one year after the date of termination. 
 “Involuntary
Termination” means termination by reason of (i) the Grantee’s involuntary dismissal by the Company or its successor for reasons other than Cause; or (ii) the Grantee’s voluntary resignation for Good Reason as defined in any
applicable employment or severance agreement, plan, or arrangement between the Grantee and the Company, or if none, then as set forth in the Plan following (x) a substantial adverse alteration in the Grantee’s title or responsibilities
from those in effect immediately prior to the Corporate Transaction; (y) a material reduction in the Grantee’s annual base salary as of immediately prior to the Corporate Transaction (or as the same may be increased from time to time) or a
material reduction in the Grantee’s annual target bonus opportunity as of immediately prior to the Corporate Transaction; or (z) the relocation of the Grantee’s principal place of employment to a location more than 35 miles from the
Grantee’s principal place of employment as of the Corporate Transaction or the Company’s requiring the Grantee to be based anywhere other than such principal place of employment (or permitted relocation thereof) except for required travel
on the Company’s business to an extent substantially consistent with the Grantee’s business travel obligations as of immediately prior to the Corporate Transaction. To qualify as an “Involuntary Termination” the Grantee must
provide notice to the Company of any of the foregoing occurrences within 90 days of the initial occurrence and the Company shall have 30 days to remedy such occurrence.  

(c) Other Vesting Terms. Notwithstanding anything to the contrary in this Section 2, to the extent the Grantee is a party to
another agreement or arrangement with the Company that provides accelerated vesting of the Award LTIP Units in the event of certain types of employment terminations or any other applicable vesting-related events or provides more favorable vesting
provisions than provided for in this Agreement, the more favorable vesting terms of such other agreement or arrangement shall control. 
 3.
Distributions. Distributions on the LTIP Units shall be paid currently to the Grantee in accordance with the terms of the LLC Agreement. 

  
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 4. Rights with Respect to LTIP Units. If (i) the Company shall at any time be
involved in a merger, consolidation, dissolution, liquidation, reorganization, exchange of shares, sale of all or substantially all of the assets or stock of the Company or a transaction similar thereto, (ii) any stock dividend, stock split,
reverse stock split, stock combination, reclassification, recapitalization, significant repurchases of stock or other similar change in the capital structure of the Company, or any distribution to holders of Common Stock other than regular cash
dividends, shall occur or (iii) any other event shall occur which in the judgment of the Administrator necessitates action by way of adjusting the terms of the Agreement, then and in that event, the Administrator shall take any such action as
in its discretion shall be necessary to maintain the Grantee’s rights hereunder so that they are substantially proportionate to the rights existing under this Agreement prior to such event, including but not limited to, adjustments in the
number of LTIP Units then subject to this Agreement. 
 5. Legend. The records of the LLC evidencing the Award LTIP Units shall bear
an appropriate legend, as determined by the LLC in its sole discretion, to the effect that such LTIP Units are subject to restrictions as set forth herein, in the Plan and in the LLC Agreement. 

6. Restrictions on Transfer. None of the Award LTIP Units shall be sold, assigned, transferred, pledged, hypothecated, given away or in
any other manner disposed of, encumbered, whether voluntarily or by operation of law (each such action a “Transfer”), or converted into Membership Units in accordance with the LLC Agreement (a) prior to vesting, or
(b) unless such Transfer is in compliance with all applicable securities laws (including, without limitation, the Securities Act of 1933, as amended (the “Securities Act”)), and such Transfer is in accordance with the
applicable terms and conditions of the LLC Agreement; provided that, upon the approval of, and subject to the terms and conditions specified by, the Administrator, unvested Award LTIP Units may be Transferred to members of the Grantee’s
Immediate Family, which for purposes of this Agreement shall include family limited partnerships and similar entities which are primarily for the benefit of the Grantee and his or her Immediate Family, provided that the transferee agrees in writing
with the Company and the LLC to be bound by all of the terms and conditions of this Agreement. In connection with any Transfer of Award LTIP Units, the LLC may require the Grantee to provide an opinion of counsel, satisfactory to the LLC, that such
Transfer is in compliance with all federal and state securities laws (including, without limitation, the Securities Act). Any attempted Transfer of Award LTIP Units not in accordance with the terms and conditions of this Section 6 shall
be null and void, and the LLC shall not reflect on its records any change in record ownership of any LTIP Units as a result of any such Transfer, shall otherwise refuse to recognize any such Transfer and shall not in any way give effect to any such
Transfer of any LTIP Units. This Agreement is personal to the Grantee, is non-assignable and is not transferable in any manner, by operation of law or otherwise, other than by will, the laws of descent and distribution or the transfer provisions
specified above in this Section 6. 
 7. Incorporation of Plan. The provisions of the Plan are hereby incorporated by reference
as if set forth herein. If and to the extent that any provision contained in this Agreement is inconsistent with the Plan, this Agreement shall govern. 

  
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 8. Investment Representation; Registration. The Grantee hereby makes the covenants,
representations and warranties set forth on Exhibit B attached hereto as of the date of acceptance of this Agreement and each Vesting Date. All of such covenants, warranties and representations shall survive the execution and delivery of this
Agreement by the Grantee. The Grantee shall immediately notify the LLC upon discovering that any of the representations or warranties set forth on Exhibit B were false when made or have, as a result of changes in circumstances, become false.
The LLC will have no obligation to register under the Securities Act any LTIP Units or any other securities issued pursuant to this Agreement or upon conversion or exchange of the LTIP Units. 

9. Section 83(b) Election. The Grantee hereby agrees to make an election to include in gross income in the year of transfer the
Award LTIP Units pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended (the “Code”) substantially in the form attached hereto as Exhibit C and to supply the necessary information in accordance with the
regulations promulgated thereunder. 
 10. Amendment. The Grantee acknowledges that the Plan may be amended or discontinued in
accordance with Section 12 thereof and that this Agreement may be amended or canceled by the Administrator of the Plan, on behalf of the LLC, for the purpose of satisfying changes in law or for any other lawful purpose, provided that no such
action shall impair the Grantee’s rights under this Agreement without the Grantee’s written consent. 
 11. Withholding and
Taxes. No later than the date as of which an amount first becomes includible in the gross income of the Grantee for income tax purposes or subject to the Federal Insurance Contributions Act withholding with respect to the Award LTIP Units, the
Grantee will pay to the Company or, if appropriate, any of its affiliates, or make arrangements satisfactory to the Administrator regarding the payment of, any United States federal, state or local or foreign taxes of any kind required by law to be
withheld with respect to such amount. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company and its affiliates shall, to the extent permitted by law, have the right to deduct any
such taxes from any payment otherwise due to the Grantee. 
 12. No Obligation to Continue Employment. Neither the Company, the LLC
nor any subsidiary of any of them is obligated by or as a result of the Plan or this Agreement to continue to have the Grantee provide services to it or to continue the Grantee in employment and neither the Plan nor this Agreement shall interfere in
any way with the right of the Company, the LLC or any subsidiary of any of them to terminate its relationship with the Grantee or the employment of the Grantee at any time. 

13. Notices. Notices hereunder shall be mailed or delivered to the LLC at its principal place of business and shall be mailed or
delivered to the Grantee at the address on file with the LLC or, in either case, at such other address as one party may subsequently furnish to the other party in writing. 

14. Section 409A. If any compensation provided by this Agreement may result in the application of Section 409A of the Code
(“Section 409A”), the Company shall, in consultation with the Grantee, modify the Agreement in the least restrictive manner necessary in order to, where applicable, (a) exclude such compensation from the definition of “deferred
compensation” within the meaning of such Section 409A or (b) comply with the provisions of Section 409A, other applicable provision(s) of the Code and/or any rules, regulations or other regulatory guidance issued under such
statutory provisions and to make such modifications, in each case, without any diminution in the value of the payments to the Grantee. 

  
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 15. Governing Law. This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York, applied without regard to conflict of law principles. The parties hereto agree that any action or proceeding arising directly, indirectly or otherwise in connection with, out of, related to or from this Agreement,
any breach hereof or any action covered hereby, shall be resolved within the State of New York and the parties hereto consent and submit to the jurisdiction of the federal and state courts located within the City of New York, New York. The parties
hereto further agree that any such action or proceeding brought by either party to enforce any right, assert any claim, obtain any relief whatsoever in connection with this Agreement shall be brought by such party exclusively in federal or state
courts located within the State of New York. 
 16. Electronic Signature. All references to signatures and delivery of documents in
this Agreement can be satisfied by procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents, including this Agreement. The Grantee’s electronic signature is the
same as, and shall have the same force and effect as, Grantee’s manual signature. Any such procedures and delivery may be effected by a third party engaged by the Company to provide administrative services related to the Plan. 

(Signature Page Follows) 

  
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 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the
    day of             , 20    . 
  

					
	MORGANS HOTEL GROUP CO.
		
	By:	 	  

		 	Name:
		 	Title:
	
	MORGANS GROUP LLC
		
	By:	 	Morgans Hotel Group Co., its
		 	managing member
			
		 	By:	 	  

		 		 	Name:
		 		 	Title:
	
	GRANTEE
	
	  

	Name:
	Address:

  
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 EXHIBIT A 

FORM OF MEMBER SIGNATURE PAGE 

The Grantee, desiring to become one of the within named Members of Morgans Group LLC, hereby accepts all of the terms and conditions of, and
becomes a party to, the Limited Liability Company Agreement of Morgans Group LLC (the “LLC Agreement”). The Grantee agrees that this signature page may be attached to any counterpart of the LLC Agreement. 

Signature Line for Member: 
  

	
	  

	Name:
	Date:
	
	Address of Member:

  
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 EXHIBIT B 

GRANTEE’S COVENANTS, REPRESENTATIONS AND WARRANTIES 

The Grantee hereby represents, warrants and covenants as follows: 

(a) The Grantee has received and had an opportunity to review the following documents (the “Background Documents”): 

(i) The Company’s latest Annual Report to Stockholders that has been provided to stockholders after the Company’s
initial public offering, if available; 
 (ii) The Company’s Proxy Statement for its most recent Annual Meeting of
Stockholders following the Company’s initial public offering, if available; 
 (iii) The Company’s Report on Form
10-K for the fiscal year most recently ended following the Company’s initial public offering, if available; 
 (iv) If
any of the documents described in clauses (i) – (iii) above or (v) or (vi) below is not available, the Company’s Registration Statement on Form S-1 registering the Company’s initial public offering of its common
stock; 
 (v) The Company’s Form 10-Q for the most recently ended quarter if one has been filed by the Company with the
Securities and Exchange Commission since the filing of the Form 10-K described in clause (iii) above or, if a Form 10-K has not been filed by the Company, since the filing of the Form S-1 described in clause (iv) above; 

(vi) Each of the Company’s Current Report(s) on Form 8-K, if any, filed since the later of the end of the fiscal year most
recently ended for which a Form 10-K has been filed by the Company or the filing of the Form S-1 described in clause (iv) above; 

(vii) The LLC Agreement; 

(viii) The Plan; and 

(ix) The Company’s Certificate of Incorporation, as amended. 

The Grantee also acknowledges that any delivery of the Background Documents and other information relating to the Company and the LLC prior to
the determination by the LLC of the suitability of the Grantee as a holder of LTIP Units shall not constitute an offer of LTIP Units until such determination of suitability shall be made. 

  
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 (b) The Grantee hereby represents and warrants that 

(i) The Grantee either (A) is an “accredited investor” as defined in Rule 501(a) under the Securities Act of
1933, as amended (the “Securities Act”), or (B) by reason of the business and financial experience of the Grantee, together with the business and financial experience of those persons, if any, retained by the Grantee to represent or
advise him, her or it with respect to the grant to him, her or it of LTIP Units, the potential conversion of LTIP Units into common units of the LLC (“Common Units”) and the potential redemption of such Common Units for shares of common
stock (“Shares”), has such knowledge, sophistication and experience in financial and business matters and in making investment decisions of this type that the Grantee (I) is capable of evaluating the merits and risks of an investment
in the LLC and potential investment in the Company and of making an informed investment decision, (II) is capable of protecting his, her or its own interest or has engaged representatives or advisors to assist him, her or it in protecting his, her
or its interests, and (III) is capable of bearing the economic risk of such investment. 
 (ii) The Grantee understands that
(A) the Grantee is responsible for consulting his, her or its own tax advisors with respect to the application of the U.S. federal income tax laws, and the tax laws of any state, local or other taxing jurisdiction to which the Grantee is or by
reason of the award of LTIP Units may become subject, to his, her or its particular situation; (B) the Grantee has not received or relied upon business or tax advice from the Company, the LLC or any of their respective employees, agents,
consultants or advisors, in their capacity as such; (C) the Grantee provides or will provide services to the LLC on a regular basis and in such capacity has access to such information, and has such experience of and involvement in the business
and operations of the LLC, as the Grantee believes to be necessary and appropriate to make an informed decision to accept this Award of LTIP Units; and (D) an investment in the LLC and/or the Company involves substantial risks. The Grantee has
been given the opportunity to make a thorough investigation of matters relevant to the LTIP Units and has been furnished with, and has reviewed and understands, materials relating to the LLC and the Company and their respective activities
(including, but not limited to, the Background Documents). The Grantee has been afforded the opportunity to obtain any additional information (including any exhibits to the Background Documents) deemed necessary by the Grantee to verify the accuracy
of information conveyed to the Grantee. The Grantee confirms that all documents, records, and books pertaining to his, her or its receipt of LTIP Units which were requested by the Grantee have been made available or delivered to the Grantee. The
Grantee has had an opportunity to ask questions of and receive answers from the LLC and the Company, or from a person or persons acting on their behalf, concerning the terms and conditions of the LTIP Units. The Grantee has relied upon, and is
making its decision solely upon, the Background Documents and other written information provided to the Grantee by the LLC or the Company. The Grantee did not receive any tax, legal or financial advice from the LLC or the Company and, to the extent
it deemed necessary, has consulted with its own advisors in connection with its evaluation of the Background Documents and this Agreement and the Grantee’s receipt of LTIP Units. 

(iii) The LTIP Units to be issued, the Common Units issuable upon conversion of the LTIP Units and any Shares issued in
connection with the redemption of any such Common Units will be acquired for the account of the Grantee for investment only and not with a current view to, or with any intention of, a distribution or resale thereof, in whole or in part, or the grant
of any participation therein, without prejudice, however, to the Grantee’s right (subject to the terms of the LTIP Units, the Plan and this Agreement) at all times to sell or otherwise dispose of all or any part of his or her LTIP Units, Common
Units or Shares in compliance with the Securities Act, and applicable state securities laws, and subject, nevertheless, to the disposition of his or her assets being at all times within his or her control. 

  
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 (iv) The Grantee acknowledges that (A) neither the LTIP Units to be issued,
nor the Common Units issuable upon conversion of the LTIP Units, have been registered under the Securities Act or state securities laws by reason of a specific exemption or exemptions from registration under the Securities Act and applicable state
securities laws and, if such LTIP Units or Common Units are represented by certificates, such certificates will bear a legend to such effect, (B) the reliance by the LLC and the Company on such exemptions is predicated in part on the accuracy
and completeness of the representations and warranties of the Grantee contained herein, (C) such LTIP Units, or Common Units, therefore, cannot be resold unless registered under the Securities Act and applicable state securities laws, or unless
an exemption from registration is available, (D) there is no public market for such LTIP Units and Common Units and (E) neither the LLC nor the Company has any obligation or intention to register such LTIP Units or the Common Units
issuable upon conversion of the LTIP Units under the Securities Act or any state securities laws or to take any action that would make available any exemption from the registration requirements of such laws, except, that, upon the redemption of the
Common Units for Shares, the Company currently intends to issue such Shares under the Plan and pursuant to a Registration Statement on Form S-8 under the Securities Act, to the extent that (I) the Grantee is eligible to receive such Shares
under the Plan at the time of such issuance, (II) the Company has filed an effective Form S-8 Registration Statement with the Securities and Exchange Commission registering the issuance of such Shares. The Grantee hereby acknowledges that because of
the restrictions on transfer or assignment of such LTIP Units acquired hereby and the Common Units issuable upon conversion of the LTIP Units which are set forth in the LLC Agreement or this Agreement, the Grantee may have to bear the economic risk
of his, her or its ownership of the LTIP Units acquired hereby and the Common Units issuable upon conversion of the LTIP Units for an indefinite period of time. 

(v) The Grantee has determined that the LTIP Units are a suitable investment for the Grantee. 

(vi) No representations or warranties have been made to the Grantee by the LLC or the Company, or any officer, director,
shareholder, agent, or affiliate of any of them, and the Grantee has received no information relating to an investment in the LLC or the LTIP Units except the information specified in Paragraph (b) above. 

(c) So long as the Grantee holds any LTIP Units, the Grantee shall disclose to the LLC in writing such information as may be reasonably
requested with respect to ownership of LTIP Units as the LLC may deem reasonably necessary to ascertain and to establish compliance with provisions of the Code, applicable to the LLC or to comply with requirements of any other appropriate taxing
authority. 

  
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 (d) The Grantee hereby agrees to make an election under Section 83(b) of the Code with
respect to the LTIP Units awarded hereunder, and has delivered with this Agreement a completed, executed copy of the election form attached hereto as Exhibit C. The Grantee agrees to file the election (or to permit the LLC to file such election
on the Grantee’s behalf) within thirty (30) days after the Award of the LTIP Units hereunder with the IRS Service Center at which such Grantee files his or her personal income tax returns, and to file a copy of such election with the
Grantee’s U.S. federal income tax return for the taxable year in which the LTIP Units are awarded to the Grantee. 
 (e) The address
set forth on the signature page of this Agreement is the address of the Grantee’s principal residence, and the Grantee has no present intention of becoming a resident of any country, state or jurisdiction other than the country and state in
which such residence is sited. 
 (f) The representations of the Grantee as set forth above are true and complete to the best of the
information and belief of the Grantee, and the LLC shall be notified promptly of any changes in the foregoing representations. 

  
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 EXHIBIT C 

ELECTION TO INCLUDE IN GROSS INCOME IN YEAR OF 

TRANSFER OF PROPERTY PURSUANT TO SECTION 83(B) 

OF THE INTERNAL REVENUE CODE 

The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described
below and supplies the following information in accordance with the regulations promulgated thereunder: 
  

	 	1.	The name, address and taxpayer identification number of the undersigned are: 

Name:                       
 (the “Taxpayer”) 
 Address: 

Social Security No./Taxpayer Identification No.: 
  

	 	2.	Description of property with respect to which the election is being made: 

 The election is
being made with respect to              LTIP Units in Morgans Group LLC (the “LLC”). 
  

	 	3.	The date on which the LTIP Units were transferred is              , 20    . The taxable year to which this election relates is
calendar year 20        . 

  

	 	4.	Nature of restrictions to which the LTIP Units are subject: 

  

	 	(a)	With limited exceptions, until the LTIP Units vest, the Taxpayer may not transfer in any manner any portion of the LTIP Units without the consent of the LLC. 

 

	 	(b)	The Taxpayer’s LTIP Units vest in accordance with the vesting provisions described in the Schedule attached hereto. Unvested LTIP Units are forfeited in accordance with the vesting provisions described in the
Schedule attached hereto. 

  

	 	5.	The fair market value at time of transfer (determined without regard to any restrictions other than restrictions which by their terms will never lapse) of the LTIP Units with respect to which this election is being made
was $0 per LTIP Unit. 

  

	 	6.	The amount paid by the Taxpayer for the LTIP Units was $0 per LTIP Unit. 

  

	 	7.	A copy of this statement has been furnished to the LLC and to its managing member, Morgans Hotel Group Co. 

Dated:                     ,
20         
  

	
	  

	Name:

  
 12 

 Schedule to Section 83(b) Election -Vesting Provisions of LTIP Units 

LTIP Units are subject to time-based vesting with one-third (1/3) vesting each year on the first three one-year anniversaries of the date
of grant, provided that the Taxpayer remains an employee of Morgans Hotel Group Co. (the “Company”) or its subsidiaries through such dates, subject to acceleration in the event of certain extraordinary transactions. Unvested LTIP Units are
subject to forfeiture in the event of failure to vest based on the passage of time and continued employment with the Company or its subsidiaries. 

  
 13EX-10.1

 Exhibit 10.1 

FRANKLIN RESOURCES, INC. 

2014 KEY EXECUTIVE INCENTIVE COMPENSATION PLAN 

SECTION 1 
 ESTABLISHMENT
AND PURPOSE 
 1.1 Purpose. Franklin Resources, Inc. hereby establishes the Franklin Resources, Inc. 2014 Key Executive Incentive
Compensation Plan (the “Plan”). The Plan is intended to increase stockholder value and the success of the Company by motivating key employees (a) to perform to the best of their abilities and (b) to achieve the
Company’s objectives. The Plan’s goals are to be achieved by providing such key employees with incentive awards based on the achievement of goals relating to performance of the Company and its individual business units. The Plan is
intended to qualify as performance-based compensation under Code Section 162(m). 
 1.2 Effective Date. The Plan shall become
effective as of December 10, 2013, the date on which the Plan is adopted by the Board, provided that the Plan is approved by the affirmative vote of the holders of a majority of the shares of common stock of the Company which are present
or represented and entitled to vote and voted at the Company’s annual meeting during calendar year 2014, and if the Plan is not so approved by the Company’s shareholders, the Plan and any awards under the Plan shall not be effective, no
such awards shall be paid, and the Plan and any such awards shall thereupon be deemed null and void ab initio. From and after the effective date of the Plan, the Company’s 2004 Key Executive Incentive Compensation Plan (the “2004
Plan”) shall be terminated and no further awards shall be made under the 2004 Plan. 
 SECTION 2 

DEFINITIONS 
 The following
words and phrases shall have the following meanings unless a different meaning is plainly required by the context: 
 2.1 “Actual
Award” means as to any Performance Period, the actual award (if any) payable to a Participant for the Performance Period. An Actual Award is determined by the Payout Formula for the Performance Period, as applicable, subject to the
Committee’s authority under Section 3.6 to adjust the award otherwise determined by the Payout Formula. 
 2.2 “Award
Pool” means the total dollars (if any) designated pursuant to the Plan to fund Actual Awards payable for any Performance Period, and the amount of the Award Pool for any Performance Period shall be equal to 1.25% of PBOI for such
Performance Period. 
 2.3 “Base Salary” means as to any Performance Period, 100% of the Participant’s annualized
salary rate on the last day of such Performance Period. Such Base Salary shall be before both (a) deductions for taxes or benefits, and (b) deferrals of compensation pursuant to Company-sponsored plans. 

2.4 “Beneficiary” means the person(s) or entity(ies) designated to receive payment of an Actual Award in the event of a
Participant’s death in accordance with Section 4.5 of the Plan. The Beneficiary designation shall be effective when it is submitted in writing to and received by the Company’s human resources department during the Participant’s
lifetime on a Beneficiary Designation form provided by the Company. The submission of a new Beneficiary Designation form shall cancel all prior Beneficiary designations. 

2.5 “Board” means the Company’s Board of Directors. 

 2.6 “Code” means the Internal Revenue Code of 1986, as amended. Reference to a
specific Section of the Code shall include such Section, any valid regulation promulgated thereunder, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such Section or regulation. 

2.7 “Committee” means the committee appointed by the Board to administer the Plan. The Committee shall consist of no fewer
than two members of the Board. The members of the Committee shall be appointed by, and serve at the pleasure of, the Board. Each member of the Committee shall qualify as an “outside director” under Code Section 162(m). Notwithstanding
the foregoing, the failure of a Committee member to qualify as an “outside director” shall not invalidate the payment of any Actual Award under the Plan. 

2.8 “Company” means Franklin Resources, Inc., a Delaware corporation. 

2.9 “Determination Date” means as to any Performance Period: (a) the first day of the Performance Period, or (b) if
later, the latest date possible which will not jeopardize the Plan’s qualification as performance-based compensation under Code Section 162(m). 

2.10 “Disability” means a permanent and total disability determined in accordance with uniform and nondiscriminatory
standards adopted by the Company from time to time. 
 2.11 “Maximum Award” means as to any Participant for any Performance
Period, the amount equal to 40% of the Award Pool for such Performance Period. The Maximum Award is the maximum amount which may be paid to a Participant pursuant to the Plan for any Performance Period. 

2.12 “Participant” means as to any Performance Period, a key employee who has been selected by the Committee for
participation in the Plan for that Performance Period. 
 2.13 “Payout Formula” means as to any Performance Period, the
formula or payout matrix established by the Committee pursuant to Section 3.5, below, in order to determine the Actual Awards (if any) to be paid to Participants. The formula or matrix may differ from Participant to Participant. 

2.14 “Performance Goals” means the goal(s) (or combined goal(s)) determined by the Committee (in its discretion) to be
applicable to a Participant for a Performance Period. As determined by the Committee, the Performance Goals applicable to each Participant shall provide for a targeted level or levels of achievement using one or more measures determined by the
Committee in its discretion. 
 2.15 “Performance Period” means the 12-month period beginning on the first day of each
fiscal year of the Company, commencing with the fiscal year that began on October 1, 2013. 
 2.16 “Pre-Bonus Operating
Income” or “PBOI” means the consolidated operating income of the Company, calculated before non-operating interest, taxes and extraordinary items, and before the accrual of any Actual Awards under the Plan and any incentive
awards under Company’s Amended and Restated Annual Incentive Compensation Plan, or any successor plan, in each case determined in a manner consistent with the Company’s consolidated statement of income for the applicable Performance
Period. 
 2.17 “Retirement” means retirement from service to the Company after reaching age fifty-five (55) with at
least ten (10) years of service to the Company or a subsidiary of the Company, including service to any entity that is acquired by the Company or a subsidiary of the Company. 

2.18 “Target Award” means the target award payable under the Plan to a Participant for the Performance Period as determined
by the Committee in accordance with Section 3.4 and may be (a) expressed as a percentage of his or her Base Salary, (b) expressed as a percentage of the Award Pool, or (c) a specified amount determined by the Committee in
accordance with Section 3.4. 

 SECTION 3 

SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS 

3.1 Selection of Participants. On or prior to the Determination Date, the Committee, in its sole discretion, shall select the key
employees who shall be Participants for any Performance Period. In selecting Participants, the Committee shall choose employees who are likely to have a significant impact on the performance of the Company. Participation in the Plan is in the sole
discretion of the Committee, and on a Performance Period by Performance Period basis. Accordingly, an employee who is a Participant for a given Performance Period in no way is guaranteed or assured of being selected for participation in any
subsequent Performance Period or Performance Periods. 
 3.2 Award Pool. The funding of the Award Pool, if any, for a Performance
Period shall be dependent on the Company’s attainment of Pre-Bonus Operating Income for such Performance Period. 
 3.3
Determination of Performance Goals. The Committee, in its sole discretion, shall establish the Performance Goals for each Participant for the Performance Period. Such Performance Goals shall be set forth in writing. 

3.4 Determination of Target Awards. The Committee, in its sole discretion, shall establish a Target Award for each Participant. Each
Participant’s Target Award shall be determined by the Committee in its sole discretion, and each Target Award shall be set forth in writing. 

3.5 Determination of Payout Formula or Formulae. The Committee, in its sole discretion, shall establish a Payout Formula or Formulae
for purposes of determining the Actual Award (if any) payable to each Participant. Each Payout Formula shall (a) be in writing, (b) be based on a comparison of actual performance to the Performance Goals, (c) provide for the payment
of a Participant’s Target Award if the Performance Goals for the Performance Period are achieved, and (d) provide for an Actual Award greater than or less than the Participant’s Target Award, depending upon the extent to which actual
performance exceeds or falls below the Performance Goals. Notwithstanding any other provision of the Plan to the contrary,(i) in no event shall awards representing more than 100% of the Award Pool for a Performance Period be granted or paid to
Participants with respect to such Performance Period, (ii) no individual Participant’s Actual Award under the Plan may exceed the Maximum Award and (iii) the failure for any reason of a Participant to earn all or part of an Actual
Award or the reduction of any Participant’s Actual Award by the Committee pursuant to Section 3.6 of the Plan shall not result in any increase in any other Participant’s Actual Award. 

3.6 Determination of Actual Awards. After the end of each Performance Period, and before any Actual Award is paid to any Participant,
the Committee shall determine and certify in writing (a) the amount of Pre-Bonus Operating Income for such Performance Period, (b) the amount of the Award Pool for such Performance Period and (c) the extent to which the Performance
Goals applicable to each Participant for such Performance Period were achieved or exceeded. The Actual Award for each Participant shall be determined by the Committee by applying the Payout Formula to the level of actual performance which has been
certified by the Committee. Notwithstanding any contrary provision of the Plan, but subject to the last sentence of Section 3.5, the Committee, in its sole discretion, may increase, eliminate or reduce the Actual Award payable to any
Participant from that which otherwise would be payable under the Payout Formula. 
 3.7 Termination Prior to the Date the Actual Award
for the Performance Period is Paid. If a Participant terminates employment with the Company for any reason after the end of the applicable Performance Period but prior to the date the Actual Award for such Performance Period is paid, the
Participant shall be entitled to the payment of the Actual Award for the Performance Period subject to adjustment under Section 3.6 based on the circumstances surrounding such termination of employment. 

3.8 Termination Prior to End of the Performance Period for Reasons other than Death, Disability or Retirement. If a Participant
terminates employment with the Company prior to the end of the applicable Performance Period for any reason other than death, Disability or Retirement, the Committee shall reduce the Participant’s Actual Award proportionately based on the date
of termination (and subject to further adjustment under Section 3.6 based on the circumstances surrounding such termination of employment). 

3.9 Termination Prior to the End of the Performance Period Due to Death, Disability or Retirement. If a Participant terminates
employment with the Company prior to the end of the applicable Performance Period due 

 
to death, Disability or Retirement, the Participant (or in the case of the Participant’s death, the person who acquired the right to payment of the Actual Award pursuant to Section 4.5)
shall be entitled to the payment of the Actual Award for the Performance Period subject to adjustment under Section 3.6. 
 3.10
Leave of Absence. If a Participant is on a leave of absence at any time during a Performance Period, the Committee may reduce his or her Actual Award proportionately based on the duration of the leave of absence (and subject to adjustment
under Section 3.6). 
 SECTION 4 

PAYMENT OF AWARDS 
 4.1
Right to Receive Payment. Each Actual Award that may become payable under the Plan shall be paid solely from the general assets of the Company. Nothing in this Plan shall be construed to create a trust or to establish or evidence any
Participant’s claim of any right other than as an unsecured general creditor with respect to any payment to which he or she may be entitled. 

4.2 Timing of Payment. Payment of each Actual Award shall be made no later than March 15 of the calendar year following the
calendar year which includes the last day of the Performance Period during which the Award was earned, but in all events during such following calendar year. 

4.3 Form of Payment. Each Actual Award normally shall be paid in cash (or its equivalent) in a single lump sum. However, the Committee,
in its sole discretion, may declare any Actual Award, in whole or in part, payable in the form of a stock bonus granted under the Company’s 2002 Universal Stock Incentive Plan (the “2002 Plan”) or successor equity compensation
plan (subject to the limit on the maximum number of shares that may be issued under the 2002 Plan or successor equity compensation plan and any additional limitations on the maximum number of shares that may be awarded to any individual in any
fiscal or calendar year under the 2002 Plan or successor equity compensation plan, as applicable). The number of shares granted shall be determined by dividing the cash amount of the Actual Award by the fair market value of a share of Company common
stock on the date that the cash payment otherwise would have been made. For this purpose, “fair market value” shall be defined as provided in the 2002 Plan or successor equity compensation plan. Any shares issued pursuant to a stock bonus
granted under the 2002 Plan or successor equity compensation plan may be either fully vested or subject to vesting. 
 4.4 Other Deferral
of Actual Awards. The Committee may establish one or more programs under the Plan to permit selected Participants the opportunity to elect to defer receipt of Actual Awards. The Committee may establish the election procedures, the timing of such
elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts so deferred, and such other terms, conditions, rules and procedures that the Committee deems advisable for the administration of any such
deferral program. Any such arrangement shall be designed in a manner that is intended to be exempt from, or comply with, the requirements of Section 409A of the Code 

4.5 Payment in the Event of Death. Subject to Section 3.9, if a Participant dies prior to the payment of an Actual Award earned by
him or her for a prior Performance Period, the Actual Award shall be paid to the Participant’s Beneficiary. If a Participant fails to designate a Beneficiary or if each person designated as a Beneficiary predeceases the Participant or dies
prior to payment of an Actual Award, then the Committee shall direct the payment of such Actual Award to the Participant’s estate. 

SECTION 5 

ADMINISTRATION 
 5.1
Committee is the Administrator. The Plan shall be administered by the Committee. 
 5.2 Committee Authority. The Committee
shall have all discretion and authority necessary or appropriate to administer the Plan and to interpret the provisions of the Plan, consistent with qualification of the Plan as performance-based compensation under Code Section 162(m). Any
determination, decision or action of the Committee in connection with the construction, interpretation, administration or application of the Plan shall be final, conclusive, and binding upon all persons, and shall be given the maximum deference
permitted by law. 

 5.3 Tax Withholding. The Company shall withhold all applicable taxes from any payment,
including any non-U.S., federal, state, and local taxes. 
 5.4 Delegation by the Committee. The Committee, in its sole discretion
and on such terms and conditions as it may provide, may delegate all or part of its authority and powers under the Plan to one or more directors and/or officers of the Company; provided, however, that the Committee may delegate its authority and
powers only to the extent consistent with applicable laws (including the provisions of Section 162(m) of the Code) and the rules and regulations of the principal securities market on which the Company’s securities are listed or qualified
for trading. 
 SECTION 6 

GENERAL PROVISIONS 
 6.1
Nonassignability and Nontransferability. A Participant shall have no right to assign any interest under this Plan. No award granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than
by will, by the laws of descent and distribution, or to the limited extent provided in Section 4.5. All rights with respect to an award granted to a Participant shall be available during his or her lifetime only to the Participant. 

6.2 No Effect on Employment. The establishment and subsequent operation of the Plan, including eligibility as a Participant, shall not
be construed as conferring any legal or other rights upon any Participant for the continuation of his or her employment for any Performance Period or any other period. Generally, employment with the Company is on an at will basis only. Except as may
be provided in an employment contract with the Participant, the Company expressly reserves the right, which may be exercised at any time and without regard to when during a Performance Period such exercise occurs, to terminate any individual’s
employment with or without cause, and to treat him or her without regard to the effect which such treatment might have upon him or her as a Participant. 

6.3 No Individual Liability. No member of the Committee or the Board, or any officer of the Company, shall be liable for any
determination, decision or action made in good faith with respect to the Plan or any award under the Plan. 
 6.4 Severability; Governing
Law. If any provision of the Plan is found to be invalid or unenforceable, such provision shall not affect the other provisions of the Plan, and the Plan shall be construed in all respects as if such invalid provision has been omitted. The
provisions of the Plan shall be governed by and construed in accordance with the laws of the State of California, with the exception of California’s conflict of laws provisions. 

6.5 Affiliates of the Company. Requirements referring to employment with the Company or payment of awards may, in the Committee’s
discretion, be performed through the Company or any affiliate of the Company. 
 6.6 Indemnification. Each person who is or shall
have been a member of the Committee, or of the Board, shall be indemnified and held harmless by the Company against and from (a) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection
with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan or any award, and (b) from any and all amounts
paid by him or her in settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she shall give the Company an
opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to
which such persons may be entitled under the Company’s Certificate of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them harmless. 

 6.7 Section 409A. The Plan and any payments under the Plan are intended to comply
with or be exempt from Section 409A of the Code, and the Plan and any associated documents shall be interpreted and construed in a manner that establishes compliance with (or an exemption from) the requirements of Code Section 409A. Any
terms of the Plan that are undefined or ambiguous shall be interpreted in a manner that complies with Code Section 409A to the extent necessary to comply with Code Section 409A. If for any reason, such as imprecision in drafting, any
provision of this Plan (or of any award) does not accurately reflect its intended establishment of an exemption from (or compliance with) Code Section 409A, as demonstrated by consistent interpretations or other evidence of intent, such
provision shall be considered ambiguous as to its exemption from (or compliance with) Code Section 409A and shall be interpreted in a manner consistent with such intent. If, notwithstanding the foregoing provisions of this Section 6.7, any
provision of the Plan would cause a Participant to incur any additional tax or interest under Code Section 409A, the Company shall interpret or reform such provision in a manner intended to avoid the incurrence of any such additional tax or
interest; provided that the Company shall maintain, to the extent practicable, the original intent and economic benefit to the Participant of the applicable provision without violating the provisions of Code Section 409A. Although the Company
intends to administer the Plan so that awards and payments under the Plan will be exempt from, or will comply with, the requirements of Code Section 409A, the Company does not warrant that any award or payment under the Plan will qualify for
favorable tax treatment under Code Section 409A or any other provision of federal, state, local, or non-United States law. The Company shall not be liable to any Participant for any tax, interest, or penalties the Participant might owe as a
result of any award or payment under the Plan 
 SECTION 7 

AMENDMENT AND TERMINATION 

7.1 Amendment and Termination. The Board may amend or terminate the Plan at any time and for any reason; provided,
however, that if and to the extent required to ensure the Plan’s qualification under Code Section 162(m), any such amendment shall be subject to stockholder approval.

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