Document:

Exhibit 10.49

 

AMENDED AND RESTATED ACTIVISION BLIZZARD, INC.

 

2008 INCENTIVE PLAN

 

NOTICE OF PERFORMANCE-VESTING RESTRICTED SHARE UNIT AWARD

 

You have been awarded performance-vesting Restricted Share Units of Activision Blizzard, Inc. (the “Company”), as follows:

 

	
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Your name:
    	
 
    
	
 
    	
 
    
	
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Total number of   Restricted Share Units awarded (representing the maximum number of Restricted   Share Units which may vest hereunder):
    
	
 
    	
 
    	
 
    
	
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Target number of   Restricted Share Units awarded:
    	
 
    
	
 
    	
 
    	
 
    
	
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Date of Grant:
    	
 
    
	
 
    	
 
    	
 
    
	
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Grant ID:
    	
 
    
	
 
    	
 
    	
 
    
	
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Your Award of   Restricted Share Units is governed by the terms and conditions set forth in:
    
	
 
    	
 
    
	
 
    	
·                  this Notice of Performance-Vesting   Restricted Share Unit Award;
    
	
 
    	
 
    
	
 
    	
·                  the Restricted Share Unit Award Terms   attached hereto as Exhibit A (the “Award Terms”); and
    
	
 
    	
 
    
	
 
    	
·                  the Company’s Amended and Restated 2008   Incentive Plan, the receipt of a copy of which you hereby acknowledge.
    
						

 

·                  [Your Award of Restricted Share Units has been made in connection with your employment agreement with the Company or one of its subsidiaries as a material inducement to your entering into or renewing employment with such entity pursuant to such agreement, and is also governed by any applicable terms and conditions set forth in such agreement.]

 

·                  Schedule for Vesting:  The Restricted Share Units awarded to you will vest in accordance with Exhibit B (the “Vesting Schedule”).

 

·                  Please sign and return to the Company this Notice of Restricted Share Unit Award, which bears an original signature on behalf of the Company.  You are urged to do so promptly.

 

·                  Please return the signed Notice of Restricted Share Unit Award to the Company at:

 

Activision Blizzard, Inc.
 3100 Ocean Park Boulevard
 Santa Monica, CA 90405
 Attn:  Stock Plan Administration

 

 

·                  By accepting the Award, you are deemed to be bound by the terms and conditions set forth in the Amended and Restated 2008 Incentive Plan, this Notice of Restricted Share Unit Award and the Award Terms.

 

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You should retain the enclosed duplicate copy of this Notice of Restricted Share Unit Award for your records.

 

Any capitalized term used but not otherwise defined herein shall have the meaning ascribed to such term in the Award Terms.

 

	
 
    	
ACTIVISION   BLIZZARD, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Humam Sakhnini
    
	
 
    	
Chief   Strategy & Talent Officer
    
	
 
    	
 
    
	
 
    	
Date:
    	
 
    

 

	
ACCEPTED   AND AGREED:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
[Grantee   Name]
    	
 
    
	
 
    	
 
    
	
Date:
    	
 
    	
 
    
			

 

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EXHIBIT A

 

AMENDED AND RESTATED ACTIVISION BLIZZARD, INC.

 

2008 INCENTIVE PLAN

 

RESTRICTED SHARE UNIT AWARD TERMS

 

1.                                      Definitions.

 

(a)                                 For purposes of these Award Terms, the following terms shall have the meanings set forth below:

 

“Award” means the award described on the Grant Notice.

 

“Board” means the board of directors of Activision Blizzard, Inc.

 

“Cause” (i) shall have the meaning given to such term in Grantee’s employment agreement with any entity in the Company Group to which Grantee is then party or (ii) if Grantee is not then party to any agreement or offer letter with any entity in the Company Group or any such agreement or offer letter does not contain a definition of “cause,” shall mean a good faith determination by the Company that Grantee (A) engaged in misconduct or gross negligence in the performance of his or her duties or willfully and continuously failed or refused to perform any duties reasonably requested in the course of his or her employment; (B) engaged in fraud, dishonesty, or any other conduct that causes, or has the potential to cause, harm to any entity in the Company Group, including its business reputation or financial condition; (C) violated any lawful directives or policies of the Company Group or any applicable laws, rules or regulations; (D) materially breached his or her employment agreement, proprietary information agreement or confidentiality agreement with any entity in the Company Group; (E) was convicted of, or pled guilty or no contest to, a felony or crime involving dishonesty or moral turpitude; or (F) breached his or her fiduciary duties to the Company Group.

 

“Committee” means the compensation committee of the Board.

 

“Common Shares” means the shares of common stock, par value $0.000001 per share, of the Company or any security into which such Common Shares may be changed by reason of any transaction or event of the type referred to in Section 10 hereof.

 

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

 

“Company Group” means the Company and its subsidiaries.

 

“Company-Sponsored Equity Account” means an account that is created with the Equity Account Administrator in connection with the administration of the Company’s equity plans and programs, including the Plan.

 

 

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

 

“Employment Violation” means any material breach by Grantee of his or her employment agreement with any entity in the Company Group to which Grantee is then party for so long as the terms of that employment agreement shall apply to Grantee (with any breach of the post-termination obligations contained therein deemed to be material for purposes of this definition).

 

“Equity Account Administrator” means the brokerage firm utilized by the Company from time to time to create and administer accounts for participants in the Company’s equity plans and programs, including the Plan.

 

“Exercise Rules and Regulations” means (i) the Securities Act or any comparable federal securities law and all applicable state securities laws, (ii) the requirements of any securities exchange, securities association, market system or quotation system on which Common Shares are then traded or quoted, (iii) any restrictions on transfer imposed by the Company’s certificate of incorporation or bylaws, and (iv) any policy or procedure the Company has adopted with respect to the trading of its securities, in each case as in effect on the date of the intended transaction.

 

“Grantee” means the recipient of the Award named on the Grant Notice.

 

“Grant Notice” means the Notice of Performance-Vesting Restricted Share Unit Award to which these Award Terms are attached as Exhibit A.

 

“Look-back Period” means, with respect to any Employment Violation by Grantee, the period beginning on the date which is 12 months prior to the date of such Employment Violation by Grantee and ending on the date of computation of the Recapture Amount with respect to such Employment Violation.

 

“Plan” means the Amended and Restated Activision Blizzard, Inc. 2008 Incentive Plan, as amended from time to time.

 

“Recapture Amount” means, with respect to any Employment Violation by Grantee, the gross gain realized or unrealized by Grantee upon all vesting of Restricted Share Units or delivery or transfer of Vested Shares during the Look-back Period with respect to such Employment Violation, which gain shall be calculated as the sum of:

 

(i)                                     if Grantee has received Vested Shares during such Look-back Period and sold any such Vested Shares, an amount equal to the sum of the sales price for all such Vested Shares; plus

 

(ii)                                  if Grantee has received Vested Shares during such Look-back Period and not sold all such Vested Shares, an amount equal to the product of (A) the greatest of the following: (1) the Market Value per Share of Common Shares on the date such Vested Shares were issued or transferred to Grantee, (2) the arithmetic average of the per share closing sales prices of Common Shares as reported on NASDAQ for the 30 trading day

 

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period ending on the trading day immediately preceding the date of the Company’s written notice of its exercise of its rights under Section 13 hereof, or (3) the arithmetic average of the per share closing sales prices of Common Shares as reported on NASDAQ for the 30 trading day period ending on the trading day immediately preceding the date of computation, times (B) the number of such Vested Shares which were not sold.

 

“Restricted Share Units” means units subject to the Award, which represent the conditional right to receive Common Shares in accordance with the Grant Notice and these Award Terms, unless and until such units become vested or are forfeited to the Company in accordance with the Grant Notice and these Award Terms.

 

“Section 409A” means Section 409A of the Code and the guidance and regulations promulgated thereunder.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Vested Shares” means the Common Shares to which the holder of the Restricted Share Units becomes entitled upon vesting thereof in accordance with Section 2 or 3 hereof.

 

“Vesting Schedule” means the Vesting Schedule attached as Exhibit B to the Grant Notice.

 

“Withholding Taxes” means any taxes, including, but not limited to, social security and Medicare taxes and federal, state and local income taxes, required under any applicable law to be withheld from amounts otherwise payable to Grantee.

 

(b)                                 Any capitalized term used but not otherwise defined herein shall have the meaning ascribed to such term in the Plan.

 

2.                                      Vesting.  The Restricted Share Units shall vest in accordance with the Vesting Schedule.  Each Restricted Share Unit, upon vesting thereof, shall entitle the holder thereof to receive one Common Share (subject to adjustment pursuant to Section 10 hereof).

 

3.                                      Termination of Employment.

 

(a)                                 Cause.  In the event that Grantee’s employment is terminated by any entity in the Company Group for Cause, as of the date of such termination of employment all Restricted Share Units shall cease to vest and any outstanding Restricted Share Units and Vested Shares that have yet to settle pursuant to Section 8 hereof shall immediately be forfeited to the Company without payment of consideration by the Company.

 

(b)                                 Other.  Unless the Committee determines otherwise, in the event that Grantee’s employment is terminated for any reason other than for Cause, as of the date of such termination of employment all Restricted Share Units shall cease to vest and, with the exception of any Vested Shares that have yet to settle pursuant to Section 8 hereof, shall immediately be forfeited to the Company without payment of consideration by the Company.

 

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4.                                      Tax Withholding.  The Company shall have the right to require Grantee to satisfy any Withholding Taxes resulting from the vesting of any Restricted Share Units, the issuance or transfer of any Vested Shares or otherwise in connection with the Award at the time such Withholding Taxes become due.  The Company shall determine the method or methods Grantee may use to satisfy any Withholding Taxes contemplated by this Section 4, which may include any of the following:  (a) by delivery to the Company of a bank check or certified check or wire transfer of immediately available funds; (b) through the delivery of irrevocable written instructions, in a form acceptable to the Company, that the Company withhold Vested Shares otherwise then deliverable having a value equal to the aggregate amount of the Withholding Taxes (valued in the same manner used in computing the amount of such Withholding Taxes); (c) if securities of the Company of the same class as the Vested Shares are then traded or quoted on a national securities exchange, the Nasdaq Stock Market, Inc. or a national quotation system sponsored by the National Association of Securities Dealers, Inc., through the delivery of irrevocable written instructions, in a form acceptable to the Company, to the Equity Account Administrator (or, with the Company’s consent, such other brokerage firm as may be requested by the Grantee) to sell some or all of the Vested Shares and to thereafter deliver promptly to the Company from the proceeds of such sale an amount in cash equal to the aggregate amount of such Withholding Taxes; or (d) by any combination of (a), (b) and (c) above.  Notwithstanding anything to the contrary contained herein, any entity in the Company Group shall have the right to ensure that all Withholding Taxes contemplated by this Section 4 are satisfied by (i) withholding from Grantee’s compensation, (ii) withholding Vested Shares otherwise then deliverable (in which case Grantee will be deemed to have been issued the full number of Vested Shares), and (iii) arranging for the sale, on Grantee’s behalf, of Vested Shares otherwise then deliverable.  The Company shall have no obligation to deliver any Vested Shares unless and until all Withholding Taxes contemplated by this Section 4 have been satisfied.

 

5.                                      Deemed Agreement.  By accepting the Award, Grantee is deemed to be bound by the terms and conditions set forth in the Plan, the Grant Notice and these Award Terms.

 

6.                                      Reservation of Shares.  The Company shall at all times reserve for issuance or delivery upon vesting of the Restricted Share Units such number of Common Shares as shall be required for issuance or delivery upon vesting thereof.

 

7.                                      Dividend Equivalents.  In the event that any cash dividends are declared and paid on Common Shares to which the holder of the Restricted Share Units would have been entitled if they had been vested on the applicable record date, such dividend equivalents shall be paid (without interest) if and only to the extent the applicable Vested Shares are settled pursuant to Section 8; and any such payment shall occur as soon as reasonably practicable following the date that the applicable Vested Shares, if any, are settled pursuant to Section 8; provided, however, that no such dividend equivalents shall be paid if the Restricted Share Units have been forfeited to the Company in accordance with Section 3 hereof prior to payment thereof.  Notwithstanding the foregoing, in no event shall any such dividend equivalents be paid later than the 45th day following the year in which the related Restricted Share Units vest.  For purposes of the time and form of payment requirements of Section 409A, such dividend equivalents shall be treated separately from the Restricted Share Units.

 

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8.                                      Receipt and Delivery.  As soon as administratively practicable (and, in any event, within 30 days) after any Restricted Share Units vest, the Company shall (a) effect the issuance or transfer of the resulting Vested Shares, (b) cause the issuance or transfer of such Vested Shares to be evidenced on the books and records of the Company, and (c) cause such Vested Shares to be delivered to a Company-Sponsored Equity Account in the name of the person entitled to such Vested Shares (or, with the Company’s consent, such other brokerage account as may be requested by such person); provided, however, that, in the event such Vested Shares are subject to a legend as set forth in Section 16 hereof, the Company shall instead cause a certificate evidencing such Vested Shares and bearing such legend to be delivered to the person entitled thereto.

 

9.                                      Committee Discretion.  Except as may otherwise be provided in the Plan, the Committee shall have sole discretion to (a) interpret any provision of the Plan, the Grant Notice and these Award Terms, (b) make any determinations necessary or advisable for the administration of the Plan and the Award, and (c) waive any conditions or rights of the Company under the Award, the Grant Notice or these Award Terms.  Without intending to limit the generality or effect of the foregoing, any decision or determination to be made by the Committee pursuant to these Award Terms, including whether to grant or withhold any consent, shall be made by the Committee in its sole and absolute discretion, subject only to the terms of the Plan.  Subject to the terms of the Plan, the Committee may amend the terms of the Award prospectively or retroactively; however, no such amendment may materially and adversely affect the rights of Grantee taken as a whole without Grantee’s consent.  Without intending to limit the generality or effect of the foregoing, the Committee may amend the terms of the Award (i) in recognition of unusual or nonrecurring events (including, without limitation, events described in Section 10 hereof) affecting any entity in the Company Group or any of the Company’s other affiliates or the financial statements of any entity in the Company Group or any of the Company’s other affiliates, (ii) in response to changes in applicable laws, regulations or accounting principles and interpretations thereof, or (iii) to prevent the Award from becoming subject to any adverse consequences under Section 409A.

 

10.                               Adjustments.  Notwithstanding anything to the contrary contained herein, pursuant to Section 12 of the Plan, the Committee will make or provide for such adjustments to the Award as are equitably required to prevent dilution or enlargement of the rights of Grantee that otherwise would result from (a) any stock dividend, extraordinary dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any change of control, merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, or issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing.  Moreover, in the event of any such transaction or event, the Committee, in its discretion, may provide in substitution for the Award such alternative consideration (including, without limitation, cash), if any, as it may determine to be equitable in the circumstances and may require in connection therewith the surrender of the Award.

 

11.                               Registration and Listing.  Notwithstanding anything to the contrary contained herein, the Company shall not be obligated to issue or transfer any Restricted Share Units or Vested Shares, and no Restricted Share Units or Vested Shares may be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of or encumbered in any way, unless

 

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such transaction is in compliance with all Exercise Rules and Regulations.  The Company is under no obligation to register, qualify or list, or maintain the registration, qualification or listing of, Restricted Share Units or Vested Shares with the SEC, any state securities commission or any securities exchange, securities association, market system or quotation system to effect such compliance.  Grantee shall make such representations and furnish such information as may be appropriate to permit the Company, in light of the then existence or non-existence of an effective registration statement under the Securities Act relating to Restricted Share Units or Vested Shares, to issue or transfer Restricted Share Units or Vested Shares in compliance with the provisions of that or any comparable federal securities law and all applicable state securities laws.  The Company shall have the right, but not the obligation, to register the issuance or transfer of Restricted Share Units or Vested Shares or resale of Restricted Share Units or Vested Shares under the Securities Act or any comparable federal securities law or applicable state securities law.

 

12.                               Transferability.  Subject to the terms of the Plan and only with the Company’s consent, Grantee may transfer Restricted Share Units for estate planning purposes or pursuant to a domestic relations order; provided, however, that any transferee shall be bound by all of the terms and conditions of the Plan, the Grant Notice and these Award Terms and shall execute an agreement in form and substance satisfactory to the Company in connection with such transfer; and provided, further that Grantee will remain bound by the terms and conditions of the Plan, the Grant Notice and these Award Terms.  Except as otherwise permitted under the Plan or this Section 12, the Restricted Share Units shall not be transferable by Grantee other than by will or the laws of descent and distribution.

 

13.                               Employment Violation.  The terms of this Section 13 shall apply to the Restricted Share Units so long as Grantee is subject to an employment agreement with any entity in the Company Group.  In the event of an Employment Violation, the Company shall have the right to require (a) the forfeiture by Grantee to the Company of any outstanding Restricted Share Units or Vested Shares which have yet to settle pursuant to Section 8 hereof and (b) payment by Grantee to the Company of the Recapture Amount with respect to such Employment Violation; provided, however, that, in lieu of payment by Grantee to the Company of the Recapture Amount, Grantee, in his or her discretion, may tender to the Company the Vested Shares acquired during the Look-back Period with respect to such Employment Violation (without any consideration from the Company in exchange therefor).  Any such forfeiture of Restricted Share Units and payment of the Recapture Amount, as the case may be, shall be in addition to, and not in lieu of, any other right or remedy available to the Company arising out of or in connection with such Employment Violation, including, without limitation, the right to terminate Grantee’s employment if not already terminated and to seek injunctive relief and additional monetary damages.

 

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14.                               Compliance with Applicable Laws and Regulations and Company Policies and Procedures.

 

(a)                                 Grantee is responsible for complying with (i) any federal, state and local taxation laws applicable to Grantee in connection with the Award and (ii) all Exercise Rules and Regulations.

 

(b)                                 The Award is subject to the terms and conditions of any policy requiring or permitting the Company to recover any gains realized by Grantee in connection with the Award, including, without limitation, the Policy on Recoupment of Performance-Based Compensation Related to Certain Financial Restatements.

 

(c)                                  The Award is subject to the terms and conditions of the Executive Stock Ownership Guidelines and the limitations contained therein on the ability of Grantee to transfer any Vested Shares.

 

15.                               Section 409A.

 

(a)                                 Payments contemplated with respect to the Award are intended to comply with Section 409A, and all provisions of the Plan, the Grant Notice and these Award Terms shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A.  Notwithstanding the foregoing, (i) nothing in the Plan, the Grant Notice and these Award Terms shall guarantee that the Award is not subject to taxes or penalties under Section 409A and (ii) if any provision of the Plan, the Grant Notice or these Award Terms would, in the reasonable, good faith judgment of the Company, result or likely result in the imposition on Grantee or any other person of taxes, interest or penalties under Section 409A, the Committee may, in its sole discretion, modify the terms of the Plan, the Grant Notice or these Award Terms, without the consent of Grantee, in the manner that the Committee may reasonably and in good faith determine to be necessary or advisable to avoid the imposition of such taxes, interest or penalties; provided, however, that this Section 14 does not create an obligation on the part of the Committee or the Company to make any such modification, and in no event shall the Company be liable for the payment of or gross up in connection with any taxes, interest or penalties owed by Grantee pursuant to Section 409A.

 

(b)                                 Neither Grantee nor any of Grantee’s creditors or beneficiaries shall have the right to subject any deferred compensation (within the meaning of Section 409A) payable with respect to the Award to any anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment or garnishment.  Except as permitted under Section 409A, any deferred compensation (within the meaning of Section 409A) payable to Grantee or for Grantee’s benefit with respect to the Award may not be reduced by, or offset against, any amount owing by Grantee to the Company.

 

(c)                                  Notwithstanding anything to the contrary contained herein, if (i) the Committee determines in good faith that the Restricted Share Units do not qualify for the “short-term deferral exception” under Section 409A, (ii) Grantee is a “specified employee” (as defined in Section 409A) and (iii) a delay in the issuance or transfer of Vested Shares to Grantee or his or her estate or beneficiaries hereunder by reason of Grantee’s “separation from service” (as

 

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defined in Section 409A) with any entity in the Company Group is required to avoid tax penalties under Section 409A but is not already provided for by this Award, the Company shall cause the issuance or transfer of such Vested Shares to Grantee or Grantee’s estate or beneficiary upon the earlier of (A) the date that is the first business day following the date that is six months after the date of Grantee’s separation from service or (B) Grantee’s death.

 

16.                               Legend.  The Company may, if determined by it based on the advice of counsel to be appropriate, cause any certificate evidencing Vested Shares to bear a legend substantially as follows:

 

“THE SECURITIES REPRESENTED HEREBY 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 ACT.”

 

17.                               No Right to Continued Employment.  Nothing contained in the Grant Notice or these Award Terms shall be construed to confer upon Grantee any right to be continued in the employ of any entity in the Company Group or derogate from any right of any entity in the Company Group to retire, request the resignation of, or discharge Grantee at any time, with or without Cause.

 

18.                               No Rights as Stockholder.  No holder of Restricted Share Units shall, by virtue of the Grant Notice or these Award Terms, be entitled to any right of a stockholder of the Company, either at law or in equity, and the rights of any such holder are limited to those expressed, and are not enforceable against the Company except to the extent set forth in the Plan, the Grant Notice or these Award Terms.

 

19.                               Severability.  In the event that one or more of the provisions of these Award Terms shall be invalidated for any reason by a court of competent jurisdiction, any provision so invalidated shall be deemed to be separable from the other provisions hereof, and the remaining provisions hereof shall continue to be valid and fully enforceable.

 

20.                               Venue and Governing Law.

 

(a)                                 For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by the grant of the Restricted Share Units or these Award Terms, the parties submit and consent to the exclusive jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Los Angeles County, California or the federal courts of the United States for the Central District of California, and no other courts, regardless of where the grant of the Restricted Share Units is made and/or to be performed.

 

(b)                                 To the extent that federal law does not otherwise control, the validity, interpretation, performance and enforcement of the Grant Notice and these Award Terms shall be

 

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governed by the laws of the State of Delaware, without giving effect to principles of conflicts of laws thereof.

 

21.                               Successors and Assigns.  The provisions of the Grant Notice and these Award Terms 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 permitted assigns under Section 12 hereof and Grantee’s estate or beneficiaries as determined by will or the laws of descent and distribution.

 

22.                               Notices.

 

(a)                                 Any notice or other document which Grantee may be required or permitted to deliver to the Company pursuant to or in connection with the Grant Notice or these Award Terms shall be in writing, and may be delivered personally or by mail, postage prepaid, or overnight courier, addressed to the Company, at its office at 3100 Ocean Park Boulevard, Santa Monica, California 90405, Attn: Stock Plan Administration, or such other address as the Company by notice to Grantee may designate in writing from time to time.  Notices shall be effective upon delivery.

 

(b)                                 Any notice or other document which the Company may be required or permitted to deliver to Grantee pursuant to or in connection with the Grant Notice or these Award Terms shall be in writing, and may be delivered personally or by mail, postage prepaid, or overnight courier, addressed to Grantee at the address shown on any employment agreement or offer letter between Grantee and any entity in the Company Group in effect at the time, or such other address as Grantee by notice to the Company may designate in writing from time to time.  The Company may also, in its sole discretion, deliver any such document to Grantee electronically via an e-mail to Grantee at his or her Company-provided email address or through a notice delivered to such e-mail address that such document is available on a website established and maintained on behalf of the Company or a third party designated by the Company, including, without limitation, the Equity Account Administrator.  Notices shall be effective upon delivery.

 

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23.                               Conflict with Employment Agreement or Plan.  In the event of any conflict between the terms of any employment agreement or offer letter between Grantee and any entity in the Company Group in effect at the time and the terms of the Grant Notice or these Award Terms, the terms of the Grant Notice or these Award Terms, as the case may be, shall control.  In the event of any conflict between the terms of any employment agreement or offer letter between Grantee and any entity in the Company Group in effect at the time, the Grant Notice or these Award Terms and the terms of the Plan, the terms of the Plan shall control.

 

24.                               Imposition of Other Requirements.  The Company reserves the right to impose other requirements on Grantee’s participation in the Plan, on the Restricted Share Units and on any Common Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to facilitate the administration of the Plan, and to require Grantee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

 

25.                               Waiver.  Grantee acknowledges that a waiver by the Company of a breach of any provision of these Award Terms shall not operate or be construed as a waiver of any other provision of these Award Terms, or of any subsequent breach by Grantee or any other grantee of an equity award from the Company.

 

A-10Exhibit 10.57

 

Amendment #4 to the Employment Agreement 
 Between Thomas Tippl and Activision Blizzard, Inc.

 

This Amendment #4 to the Employment Agreement (“Amendment #4”) is entered into and is effective as of December 5, 2013, by and between Thomas Tippl (“Employee”) and Activision Blizzard, Inc. (“Employer” or “Activision Blizzard” and, together with its subsidiaries, the “Activision Blizzard Group”).  All capitalized terms shall have the same meaning set forth in the Employment Agreement (as defined below).

 

RECITALS:

 

Employee and Activision Publishing, Inc. (a subsidiary of Activision Blizzard) entered into an Employment Agreement dated as of September 9, 2005, which was amended on December 15, 2008, April 15, 2009 (which included the assignment of the Employment Agreement to Activision Blizzard), and March 23, 2010 (collectively, the “Employment Agreement”).

 

Employee and Employer desire to amend the Employment Agreement in certain respects as set forth herein.

 

AGREEMENT:

 

The parties hereby agree to amend the terms of the Employment Agreement.  Except as specifically set forth in this Amendment #4, the Employment Agreement shall remain unmodified and in full force and effect.  If any term or provision of the Employment Agreement is contradictory to, or inconsistent with, any term or provision of this Amendment #4, then the terms of this Amendment #4 shall in all events control.  The amended terms are as follows:

 

1.                                      Term of Employment:  Paragraph 1 is amended in its entirety to read as follows:

 

(a)                                 “The new term of your employment under this Employment Agreement (the “Extended Employment Period”) shall be deemed to commence on December 5, 2013 (the “New Effective Date”), and shall expire on April 30, 2016 (the “New Expiration Date”), unless earlier terminated as provided in Paragraph 9 below or as may be extended as provided in Paragraph 1(b) below.

 

(b)                                 The Employer shall once have the option to extend the Term by up to one year by notifying you in writing of its intent to do so at least six (6) months prior to the New Expiration Date.  The final date of any such extended Term shall thereafter be referred to as the “New Expiration Date” for purposes of this Agreement and the Term shall end on such date (or such earlier date on which your employment is terminated).  Except as otherwise set forth herein, upon the New Expiration Date (or such earlier date on which your employment is terminated) all obligations and rights under this Agreement shall immediately lapse.”

 

2.                                      Compensation:  Paragraph 2(a) is amended in its entirety to read as follows: “The Employee’s new annual base salary (“Base Salary”) shall be One Million, Two Hundred Fifty Thousand Dollars ($1,250,000), which shall be paid in accordance with the Employer’s payroll policies. Beginning in 2015, your Base Salary shall be reviewed annually at the regular time when the Employer conducts its periodic review of executive base salaries (which currently occurs in the first quarter of each calendar year) and may be increased (but not decreased) by an

 

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amount determined by the Compensation Committee of the Board of Directors of Activision Blizzard (“Compensation Committee”), in its sole and absolute discretion (or such other person or entity which may at the applicable time be authorized to make such determinations pursuant to the Employer’s governing documents); provided that the percentage increase shall be no less than an amount equal to the average percentage increase approved in the base salaries of the members of Activision Blizzard’s executive leadership team (i.e. Section16 officers) for that year, excluding for these purposes (i) increases that are required or guaranteed by contract and (ii) increases in base salaries in connection with a promotion or other significant modification in an executive’s duties.”

 

3.                                      Compensation:  Paragraph 2(e) of the Agreement shall be amended in its entirety to read as follows:  “You may be eligible to receive an annual discretionary bonus (the “Annual Bonus”).  Your target Annual Bonus for each calendar year shall be one hundred and fifty percent 150% of your Base Salary.  In all instances, the actual amount of the Annual Bonus, if any, shall be determined by the Compensation Committee, in its sole and absolute discretion (or such other person or entity which may at the applicable time be authorized to make such determinations pursuant to the Employer’s governing documents), and may be based on, among other things, your overall performance and the performance of all or any portion of the Activision Blizzard Group.  For purposes of evaluating your and the Activision Blizzard Group’s (and/or the applicable portion of the Activision Blizzard Group’s) performance, annual performance objectives shall be determined and evaluated by the Compensation Committee and/or the Board of Directors of Activision Blizzard (or such other person or entity which may at the applicable time be authorized to make such determinations pursuant to the Employer’s governing documents).  Employer agrees that a minimum of 70% of the performance objectives (based on target monetary value) assigned to you shall be the same as the performance objectives assigned to the Chief Executive Officer of Activision Blizzard.  In addition, the Annual Bonus, if any, shall be paid at the same time bonuses for that year are generally paid to other executives, but in no event earlier than the first day of the first month, or later than the 15th day of the third month, of the year following the year to which the Annual Bonus relates.  Except as otherwise set forth herein, you must remain continuously employed by the Activision Blizzard Group through the date on which an Annual Bonus, if any, is paid to be eligible to receive such Annual Bonus.”

 

4.                                      Compensation.  Paragraph 2(m) is hereby added to the Employment Agreement and shall read as follows:

 

“(m)                       Subject to the approval of the Compensation Committee, Activision Blizzard shall grant to you an equity award with a total grant value of approximately $25,800,000 as follows:

 

(i)                                     Activision Blizzard shall grant to you restricted share units, which represent the conditional right to receive shares of Activision Blizzard’s common stock, with a total grant value of approximately $6,000,000 (the “2013 RSU’s”).  The actual number of 2013 RSU’s awarded to you on the grant date shall be equal to $6,000,000 divided by the official closing price of Activision Blizzard’s common stock on the effective date of the grant, as reported by NASDAQ.  The number of shares awarded shall be rounded to the nearest whole number, and Activision Blizzard retains the discretion to modify the methodology for such calculations as it may determine in its sole and absolute discretion.  Finally, one-third of the

 

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2013 RSU’s shall vest on each of March 31, 2015, March 31, 2016, and March 31, 2017, subject to your remaining employed by the Activision Blizzard Group through the applicable vesting date.  The award agreement will be based on Employer’s standard restricted share unit form, which is attached as Exhibit B.

 

(ii)                                  Activision Blizzard shall grant to you performance-vesting restricted share units (“Tranche I of the 2013 Performance Share Units”), which represent the conditional right to receive shares of Activision Blizzard’s common stock, with a total grant value of approximately $9,000,000. The actual number of Tranche I of the 2013 Performance Share Units awarded to you on the grant date shall be equal to $9,000,000 divided by the official closing price of Activision Blizzard’s common stock on the effective date of the grant, as reported by NASDAQ.  The number of Tranche I of the 2013 Performance Share Units awarded shall be rounded to the nearest whole number, and Activision Blizzard retains the discretion to modify the methodology for such calculations as it may determine in its sole and absolute discretion.  A maximum of up to one-third of Tranche I of the 2013 Performance Share Units (with a value at the time of grant of approximately $3,000,000) shall vest on each of March 31, 2015, March 31, 2016, and March 31, 2017, if, and only if, you are employed by Activision Blizzard through the applicable vesting date and the Compensation Committee determines that the non-GAAP earnings per share conditions set forth in Exhibit C are satisfied with respect to the applicable year.  The percentage of Tranche I of the 2013 Performance Share Units which vest annually, if any, shall be determined as set forth in Exhibit C.

 

(iii)                               Activision Blizzard shall grant to you performance-vesting restricted share units (“Tranche II of the 2013 Performance Share Units”), which represent the conditional right to receive shares of Activision Blizzard’s common stock, with a total grant value of approximately $5,400,000. The actual number of Tranche II of the 2013 Performance Share Units awarded to you on the grant date shall be equal to $5,400,000 divided by the official closing price of Activision Blizzard’s common stock on the effective date of the grant, as reported by NASDAQ.  The number of Tranche II of the 2013 Performance Share Units awarded shall be rounded to the nearest whole number, and Activision Blizzard retains the discretion to modify the methodology for such calculations as it may determine in its sole and absolute discretion.  A maximum of up to one-third of Tranche II of the 2013 Performance Share Units (with a value at the time of grant of approximately $1,800,000) shall vest each of March 31, 2015, March 31, 2016, and March 31, 2017, if, and only if, you are employed by Activision Blizzard through the applicable vesting date and the Compensation Committee determines that the non-GAAP free cash flow conditions set forth in Exhibit C are satisfied with respect to the applicable year.  The percentage of Tranche II of the 2013 Performance Share Units which vest annually, if any, shall be determined as set forth in Exhibit C.

 

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(iv)                              Activision Blizzard shall grant to you performance-vesting restricted share units (“Tranche III of the 2013 Performance Share Units”), which represent the conditional right to receive shares of Activision Blizzard’s common stock, with a total grant value of approximately $5,400,000. The actual number of Tranche III of the 2013 Performance Share Units awarded to you on the grant date shall be equal to $5,400,000 divided by the official closing price of Activision Blizzard’s common stock on the effective date of the grant, as reported by NASDAQ.  The number of Tranche III of the 2013 Performance Share Units awarded shall be rounded to the nearest whole number, and Activision Blizzard retains the discretion to modify the methodology for such calculations, as it may determine in its sole and absolute discretion.  A maximum of up to one-third of Tranche III of the 2013 Performance Share Units (with a value at the time of grant of $1,800,000) shall vest each of March 31, 2015, March 31, 2016, and March 31, 2017, if, and only if, you are employed by Activision Blizzard through the applicable vesting date and the Compensation Committee determines that the non-GAAP operating income for Blizzard Entertainment, Inc. conditions set forth in Exhibit C are satisfied with respect to the applicable year.  The percentage of Tranche III of the 2013 Performance Share Units which vest annually, if any, shall be determined as set forth in Exhibit C.

 

Collectively, the 2013 RSU’s, Tranche I of the 2013 Performance Share Units, Tranche II of the 2013 Performance Share Units, and Tranche III of the 2013 Performance Share Units shall be referred to as the “2013 Equity Awards”.  You acknowledge that the grant of the 2013 Equity Awards pursuant to this Paragraph 2(m) is expressly conditioned upon approval by the Compensation Committee, and that the Compensation Committee has discretion to approve or disapprove the grants and/or to determine and make modifications to the terms of the grants.  The 2013 Equity Awards shall be subject to all terms of the equity incentive plan pursuant to which they are granted (the “Incentive Plan”), the Employer’s Executive Stock Ownership Guidelines (including, but not limited to, all of the limitations on equity awards described therein) which are attached as Exhibit D, and the award agreements (attached as Exhibits B & C).  In the event of a conflict between this Agreement and the terms of the Incentive Plan or award agreements, the Incentive Plan or the award agreements, as applicable, shall govern.  These 2013 Equity Awards, if and when approved by the Compensation Committee, shall be in addition to any previous equity incentive awards made to you.”

 

5.                                      Compensation.  Paragraph 2(n) is hereby added to the Employment Agreement and shall read as follows:

 

“(n)                           2013 Discretionary Bonus Payment.  The Employer shall provide you with a payment in the amount of $2,000,000 (less applicable taxes and withholdings) via wire transfer as soon as reasonably practicable, and no later than fifteen (15) days, after the execution of this Amendment #4 by both parties.  This payment shall constitute full payment of the discretionary bonus awarded to you by the Compensation Committee on March 6, 2013, and no future payments shall be due pursuant to that discretionary award, as this bonus shall be fully earned by you upon such execution.”

 

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6.                                      Other Benefits:  Paragraph 6 shall be amended to provide that Employee shall be provided during the Extended Employment Period, at Employer’s expense, with a supplemental term life insurance policy with a benefit amount of $9,375,000 through carrier of Activision Blizzard’s choice (in lieu of the $3,000,000 policy currently provided pursuant to Paragraph 6).

 

7.                                      Use of Defined Terms:  The parties agree that, with respect to the Agreement as amended by this Amendment No. 4, all references to “Restricted Shares” in Paragraph 9 of the Employment Agreement shall be deemed to include the “2013 RSUs” (in addition to the “Restricted Shares” and the “New Restricted Shares” and “RSU’s” referenced in all prior amendments).

 

8.                                      Termination of Obligations and Post Termination Payments:  The following provision is hereby added as Paragraph 9(e)(ix):  “Compensation paid pursuant to Paragraphs 9(e)(i)-(v) shall also include the following additional payment:  payment in lieu of any vacation accrued under Paragraph 7 but unused as of the Termination Date.  In addition, “Termination Date” for purposes of this Employment Agreement shall mean the effective date of your termination of employment without Cause or pursuant to Paragraphs 9 (a)-(d).”

 

9.                                      Termination of Obligations and Post Termination Payments:

 

(i)  The following provision is hereby added as Paragraph 9(e)(vii):  “Severance Conditioned Upon Release.  Certain payments and benefits described in Paragraphs (9)(e)(ii) and (iii) are conditioned upon your or your legal representative’s execution of a waiver and release in a form prepared by the Employer and that release becoming effective and irrevocable in its entirety within 60 days of the Termination Date.  Unless otherwise provided by the Employer, if the release referenced above does not become effective and irrevocable on or prior to the 60th day following the Termination Date, you shall not be entitled to any payments under Paragraphs 9(e)(ii) and 9(e)(iii) other than (x) the Base Salary through the date of your termination, (y) the reimbursement of approved expenses due to you pursuant to Paragraphs 2(h) and 5, and (z) payment in lieu of any vacation accrued under Paragraph 7 but unused as of the Termination Date.”

 

(ii) The following provision is hereby added as Paragraph 9(e)(viii):  “Termination On New Expiration Date.  In the event your employment terminates on the New Expiration Date, then you shall receive (a) the Base Salary through the New Expiration Date, (b) the reimbursement of approved expenses due to you pursuant to Paragraphs 2(h) and 5, (c) payment in lieu of any vacation accrued under Paragraph 7 but unused as of the New Expiration Date, (d) an amount equal to the Annual Bonus that the Employer determines, in its sole discretion, you would have received in accordance with Section 2(e) for any year that ended prior to the Termination Date had you remained employed through the date such bonus would have been otherwise been paid (in the event that your Termination Date occurs before such bonus would have been paid), and (e) an amount equal to the Annual Bonus that the Employer determines, in its sole discretion, you would have received in accordance with Section 2(e) for the year in which your Termination Date occurs had you had remained employed through the date such bonus would have been paid, multiplied by a fraction, the numerator of which is the number corresponding to the calendar month in which the Termination Date occurs and the denominator of which is 12, where, for purposes of calculating the amount of such bonus, any goals will be measured by actual performance.

 

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10.                               Disposition of Stock Options and Restricted Shares Upon Termination:  Paragraph 9(f) is hereby modified as follows:  The entirety of Paragraph 9(f) (including the heading) is replaced with the following text:  “Disposition of Equity Awards Upon Termination.  The following terms shall apply to the equity awards granted to you during the term of your employment upon termination of your employment as follows:

 

(i)                                     Termination by the Employer With Cause.  In the event that your employment is terminated by Employer pursuant to Paragraph 9(a), all outstanding equity awards granted to you during the term of your employment shall cease to vest and, whether or not vested, shall no longer be exercisable and shall be cancelled immediately;

 

(ii)                                  Termination by You if Employer’s Business Is Relocated More Than 25 Miles, by the Employer Without Cause or by the Employer if You Become Disabled.  In the event that your employment is terminated by you pursuant to Paragraph 9(b), or by Employer (x) without Cause, or (y) as a result of your Disability pursuant to Paragraph 9(c), all outstanding equity awards granted to you during the term of your employment shall cease to vest.  All vested RSUs and Performance Share Units shall be paid in accordance with their terms.  Any vested portion of the Option shall remain exercisable until the earlier of (x) thirty (30) days after the Termination Date and (y) the original expiration date of the Option.  Any equity awards granted to you during the term of your employment that are not vested as of your Termination Date will be cancelled immediately;

 

(iii)                               Termination as a Result of Death.  In the event that your employment is terminated by Employer as a result of your Death pursuant to Paragraph 9(c), all outstanding equity awards granted to you during the term of your employment shall cease to vest.  All vested RSUs and Performance Share Units shall be paid in accordance with their terms.  Any vested portion of the Option shall remain exercisable until the earlier of (x) one (1) year after the Termination Date or (y) the original expiration date of the Option.  Any equity awards granted to you during the term of your employment that are not vested as of your Termination Date will be cancelled immediately; or

 

(iv)                              Termination on the New Expiration Date.  In the event that your employment terminates on the New Expiration Date, all outstanding equity awards granted to you during the term of your employment shall cease to vest.  All vested RSUs and Performance Share Units shall be paid in accordance with their terms.  Any vested portion of the Option shall remain exercisable until the earlier of (x) thirty (30) days after the Termination Date and (y) the original expiration date of the Option.  Any equity awards granted to you during the term of your employment that are not vested as of your Termination Date will be cancelled immediately.

 

11.                               Venue and Jurisdiction:  Paragraph 16(h) is hereby modified as follows:  The entirety of Paragraph 16(h) (including the heading) is replaced with the following text:  “Arbitration.  Except as otherwise provided in this Agreement, both parties agree that any dispute or controversy between them will be settled by final and binding arbitration pursuant to the terms of the Dispute Resolution Agreement (attached hereto as Exhibit E).”

 

12.                               Notices:  Your address in Paragraph 17 is updated to be the address you have previously provided to the Employer.

 

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13.                               Section 280G and Section 162(m):  A new Paragraph 18 is hereby added as follows:  “Notwithstanding anything herein to the contrary, in the event that you receive any payments or distributions, whether payable, distributed or distributable pursuant to the terms of this Agreement or otherwise, that constitute “parachute payments” within the meaning of Section 280G of the Code, and the net after-tax amount of the parachute payment is less than the net after-tax amount if the aggregate payment to be made to you were three times your “base amount” (as defined in Section 280G(b)(3) of the Code), less $1.00, then the aggregate of the amounts constituting the parachute payment shall be reduced to an amount that will equal three times your base amount, less $1.00.  To the extent the aggregate of the amounts constituting the parachute payments are required to be so reduced, the amounts provided under Paragraph 9 of this Agreement shall be reduced (if necessary, to zero) with amounts that are payable first reduced first; provided, however, that, in all events the payments provided under Paragraph 9 of this Agreement which are not subject to Section 409A shall be reduced first.  Similarly, you agree that no payments or distributions, whether payable, distributed or distributable pursuant to the terms of this Agreement or otherwise, shall be made to you if the Employer reasonably anticipates that Section 162(m) of the Code would prevent the Employer from receiving a deduction for such payment.  If, however, any payment is not made pursuant to the previous sentence, the Employer shall make such payment as soon as practicable in the first calendar year that it reasonably determines that it can do so and still receive a deduction for such payment.  The determinations to be made with respect to this Paragraph 18 shall be made by a certified public accounting firm designated by the Employer.”  The company acknowledges and agrees that the foregoing provision of this Paragraph 13 of this Amendment #4 does not apply to the payment required by Paragraph 5 of this Amendment #4.

 

14.                               Indemnification:  A new Paragraph 19 is hereby added as follows:  “The Employer agrees that it shall indemnify and hold you harmless to the fullest extent permitted by Delaware law from and against any and all third-party liabilities, costs and claims, and all expenses actually and reasonably incurred by you in connection therewith by reason of the fact that you are or were employed by the Activision Blizzard Group, including, without limitation, all costs and expenses actually and reasonably incurred by you in defense of litigation arising out of your employment hereunder.”

 

15.  Exhibit A and Related Provisions:  Exhibit A, Paragraph 6 of Amendment #1 and Paragraph 7 of Amendment #2 are all deleted in their entirety.

 

16.  No Shop Clause:  Paragraph 10 is hereby modified as follows:  In the second line, “120 days,” is replaced with “180 days”.

 

17.  Performance Termination:  Paragraph 9(d) is deleted in its entirety as well as any other references to “Performance Deficiency,” “Performance Termination” and to Paragraph 9(d), including, without limitation, Paragraph 9(e)(v).

 

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AGREED AND ACCEPTED:
    	
 
    
	
 
    	
 
    
	
Employer
    	
Employee
    
	
 
    	
 
    
	
ACTIVISION   BLIZZARD, INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Chris B. Walther
    	
 
    	
/s/ Thomas Tippl
    
	
Chris B. Walther
    	
Thomas Tippl
    
	
 
    	
 
    
	
 
    	
 
    
	
Date:
    	
January 15, 2014
    	
 
    	
Date:
    	
January 15,   2014
    
						

 

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