Document:

Form of Restricted Stock Grant for Officers

 Exhibit 10.20 
  

			
	Callaway Golf Company	 	Recipient:
	Restricted Stock Grant	 	Effective Grant Date:
	 	 	Number of Shares:
	 	 	Plan:                      2004 Equity Incentive Plan

  
 CALLAWAY GOLF COMPANY,
a Delaware corporation (the “Company”), has elected to grant to you, the Recipient named above, an award of stock subject to the restrictions and on the terms and conditions set forth below. Terms not otherwise defined in this
Restricted Stock Grant will have the meanings ascribed to them in the Plan identified above (the “Plan”). 
  

	1.	Governing Plan. The Recipient hereby acknowledges receipt of a copy of the Plan and a Prospectus for the Plan (the “Plan Prospectus”).
This Restricted Stock Grant is subject in all respects to the applicable provisions of the Plan, which are incorporated herein by this reference. In the case of any conflict between the provisions of the Plan and this Restricted Stock Grant, the
provisions of the Plan will control. 

  

	2.	Grant of Restricted Stock. Effective as of the Effective Grant Date identified above, the Company has granted and issued to the Recipient the Number of Shares of the
Company’s Common Stock identified above (the “Restricted Stock”), subject to the terms, conditions and restrictions set forth in this Restricted Stock Grant. 

  

	3.	Restrictions on the Granted Stock. The Restricted Stock is subject to the following restrictions: 

  

	 	(a)	No Transfer. The shares of Restricted Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of or encumbered until the restrictions
set forth in this paragraph lapse or expire as provided in paragraph 4, and any additional requirements or restrictions contained in this Restricted Stock Grant have been satisfied, terminated or waived by the Company in writing.

  

	 	(b)	Cancellation of Unvested Shares. In the event Recipient ceases to be an employee of the Company or its subsidiary for any reason before the restrictions set forth in
this paragraph have lapsed or expired as provided in paragraph 4, the Company will cancel and void all shares of Restricted Stock for which such restrictions have not lapsed or expired (i.e. unvested shares); provided, however, that
the Board of Directors or its designee may, in its discretion, determine not to cancel and void all or part of such unvested shares, in which case the Board of Directors or designee may impose whatever conditions it considers appropriate on any
shares that are not cancelled or voided. 

  

	 	(c)	Certificate. The certificate(s) representing the Restricted Stock will remain in the physical custody of the Company or its designated agent until the restrictions set
forth in this paragraph lapse or expire as provided in paragraph 4, and any additional requirements or restrictions contained in this Restricted Stock Grant have been satisfied, terminated or expressly waived by the Company in writing.
Notwithstanding the foregoing, the Company may elect to maintain the shares in book-entry form with its transfer agent unless and until the Company is required to deliver the certificates hereunder. 

  

	 	(d)	Restrictive Legend. The certificate(s) representing the Restricted Stock may bear a legend making reference to any restrictions (or other terms and conditions)
imposed by this Restricted Stock Grant as the Company deems necessary or appropriate to enforce such restrictions (or other terms and conditions). 

	4.	Lapse of Restrictions. The restrictions imposed under paragraph 3 will lapse and expire, and the shares of Restricted Stock will vest, in accordance with the
following: 

  

	 	(a)	Vesting Schedule. Subject to earlier cancellation, and subject to the accelerated vesting provisions, if any, set forth in any employment agreement between Recipient
and the Company or its subsidiary, as the same may be amended, modified, extended or renewed from time to time, the restrictions imposed under paragraph 3 will lapse and be removed with respect to the number of shares of Restricted Stock set
forth below in accordance with the vesting schedule set forth below (the “Vesting Schedule”): 

  

			
	 Number of Shares

	 	 Date Restrictions Lapse

	 	 	 

  
 The Board of
Directors or its designee, however, may, in its discretion, accelerate the Vesting Schedule (in which case, the Board of Directors or designee may impose whatever conditions it considers appropriate on the accelerated portion). In addition, the
restrictions imposed under paragraph 3 will automatically lapse and be removed immediately prior to any Change in Control, if the Recipient is an employee or consultant of the Company or its subsidiary at that time, provided, however,
that the Board of Directors, or appropriate committee thereof, in its sole discretion, may provide that such restrictions do not automatically lapse immediately prior to any such Change in Control, and instead provide that the Restricted Stock shall
continue under the same terms and conditions or shall continue under the same terms and conditions with respect to shares of a successor company that may be issued in exchange or settlement of such Restricted Stock in connection with a Change in
Control. Notwithstanding the foregoing, if the Committee elects to provide that such restrictions do not lapse in connection with a Change in Control and Recipient’s employment is terminated for any reason within one year following such Change
in Control, then such restrictions shall lapse and be removed immediately upon such termination of employment. For purposes hereof, “Change in Control” shall have the meaning set forth in Exhibit A attached hereto. 
  

	 	(b)	 Payment of Taxes. Upon the lapse of the restrictions in accordance with the foregoing, Recipient must pay in the form of a check or cash or other cash
equivalents to the Company such amount as the Company determines it is required to withhold under applicable laws as a result of the lapse of such restrictions. In this regard, you authorize the Company and/or its subsidiary to withhold all
applicable tax-related items legally payable by you from your wages or other cash compensation paid to you by the Company and/or its subsidiary or from proceeds of the sale of shares of Restricted Stock. Alternatively, or in addition, if permissible
under local law, the Company may (1) sell or arrange for the sale of shares of Restricted Stock that you acquire to meet the withholding obligation for tax-related items, and/or (2) withhold from the shares of Restricted Stock for which
the restrictions have lapsed that number of shares having an aggregate Fair Market Value (as defined in the Plan), determined as of the date the tax withholding obligation arises, equal to the amount of the total withholding tax obligation;
provided, however, that, the number of shares so withheld shall not have an aggregate Fair Market Value in excess of the minimum required withholding. You acknowledge that the ultimate liability for all tax-related items legally due by you is and
remains your responsibility and that Company 

  

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and/or its subsidiary (a) makes no representations or undertakings regarding the treatment of any tax-related items in connection with any aspect of the
Restricted Stock, including the grant or vesting or and subsequent sale of shares of Restricted Stock or the receipt of any dividends; and (b) do not commit to structure the terms of the grant or any aspect of the Restricted Stock to reduce or
eliminate your liability for tax-related items. 

  

	 	(c)	Release of Certificate. As soon as practicable after the lapse and removal of the restrictions applicable to all or any portion of the Restricted Stock as provided in
this paragraph, the Company will release (or cause to be issued) certificate(s) representing such Restricted Stock to the Recipient, provided that the Recipient has paid to the Company, by cash or check or by any other method permitted by
paragraph 4(b), an amount sufficient to satisfy any taxes or other amounts required by any governmental authority to be withheld and paid over to such authority for the Recipient’s account, or otherwise made arrangements satisfactory to
the Company for the payment of such amounts through withholding or otherwise. 

  

	5.	Voting and Other Rights. Notwithstanding anything to the contrary in the foregoing, during the period prior to the lapse and removal of the restrictions set
forth in paragraph 3, except as otherwise provided herein, the Recipient will have all of the rights of a shareholder with respect to all of the Restricted Stock, including without limitation the right to vote the Restricted Stock and the
right to receive all dividends or other distributions with respect to the Restricted Stock. In connection with the payment of such dividends or other distributions, the Company will be entitled to deduct any taxes or other amounts required by any
governmental authority to be withheld and paid over to such authority for the Recipient’s account. 

  

	6.	Section 83(b) Election. The Recipient will be entitled to make an election pursuant to Section 83(b) of the Internal Revenue Code, or comparable provisions
of any state tax law, to include in the Recipient’s gross income the amount by which the fair market value of the Restricted Stock the Recipient acquires exceeds the consideration paid for such shares only if, prior to making any such
election, the Recipient (a) timely notifies the Company in writing of the Recipient’s intention to make such election by delivering to the Company a copy of a fully-executed Section 83(b) Election Form approved by the Company and
(b) pays to the Company an amount sufficient to satisfy any taxes or other amounts required by any governmental authority to be withheld or paid over to such authority for the Recipient’s account, or otherwise makes arrangements
satisfactory to the Company for the payment of such amounts through withholding or otherwise. Recipient hereby acknowledges that (i) the foregoing does not set forth all the requirements for effecting a valid 83(b) election, (ii) that
Recipient will need to take additional action, including making certain filings with the Internal Revenue Service to make a valid 83(b) election and (iii) that the Company has no responsibility for ensuring that Recipient satisfies the
requirements for a valid 83(b) election. 

  

	7.	Taxable Event. The Recipient acknowledges that the Restricted Stock will have significant tax consequences to the Recipient and Recipient is hereby advised
to consult with Recipient’s own tax advisors concerning such tax consequences. A general description of the U.S. federal income tax consequences related to restricted stock awards is set forth in the Plan Prospectus.

  

	8.	 Severability. The provisions of this Agreement shall be deemed to be severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any person or any circumstance, is held to be invalid or unenforceable under present or future laws 

  

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effective during the term of this Agreement, such provision shall be fully severed, and in lieu thereof there shall automatically be added as part of this
Agreement a suitable and equitable provision in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid or unenforceable provision. 

  

	9.	Governing Law. This Restricted Stock Grant will be governed by and construed in accordance with the laws of the State of Delaware and applicable federal law.

  

	10.	Irrevocable Arbitration of Disputes. 

  
 (a) You and the Company agree that any dispute, controversy or claim arising hereunder or in any way related to this Agreement, its
interpretation, enforceability, or applicability, that cannot be resolved by mutual agreement of the parties shall be submitted to binding arbitration. The parties agree that arbitration is the parties’ only recourse for such claims and hereby
waive the right to pursue such claims in any other forum, unless otherwise provided by law. Any court action involving a dispute which is not subject to arbitration shall be stayed pending arbitration of arbitrable disputes. 
  
 (b) You and the Company agree that the arbitrator shall
have the authority to issue provisional relief. You and the Company further agree that each has the right, pursuant to California Code of Civil Procedure section 1281.8, to apply to a court for a provisional remedy in connection with an arbitrable
dispute so as to prevent the arbitration from being rendered ineffective. 
  
 (c) Any demand for arbitration shall be in writing and must be communicated to the other party prior to the expiration of the applicable statute of limitations. 
  
 (d) The arbitration shall be administered by JAMS
pursuant to its Employment Arbitration Rules and Procedures. The arbitration shall be conducted in San Diego by a former or retired judge or attorney with at least 10 years experience in employment-related disputes, or a non-attorney with like
experience in the area of dispute, who shall have the power to hear motions, control discovery, conduct hearings and otherwise do all that is necessary to resolve the matter. The parties must mutually agree on the arbitrator. If the parties cannot
agree on the arbitrator after their best efforts, an arbitrator will be selected from JAMS pursuant to its Employment Arbitration Rules and Procedures. The Company shall pay the costs of the arbitrator’s fees. 
  
 (e) The arbitration will be decided upon a written
decision of the arbitrator stating the essential findings and conclusions upon which the award is based. The arbitrator shall have the authority to award damages, if any, to the extent that they are available under applicable law(s). The arbitration
award shall be final and binding, and may be entered as a judgment in any court having competent jurisdiction. Either party may seek review pursuant to California Code of Civil Procedure section 1286, et seq. 
  
 (f) It is expressly understood that the parties have
chosen arbitration to avoid the burdens, costs and publicity of a court proceeding, and the arbitrator is expected to handle all aspects of the matter, including discovery and any hearings, in such a way as to minimize the expense, time, burden and
publicity of the process, while assuring a fair and just result. In particular, the parties expect that the arbitrator will limit discovery by controlling the amount of discovery that may be taken (e.g., the 

  

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number of depositions or interrogatories) and by restricting the scope of discovery only to those matters clearly relevant to the dispute. However, at a
minimum, each party will be entitled to at least one (1) deposition and shall have access to essential documents and witnesses as determined by the arbitrator. 
  
 (g) The provisions of this Section shall survive the expiration or termination of the Agreement, and
shall be binding upon the parties. 
  
 THE PARTIES HAVE READ SECTION 10
AND IRREVOCABLY AGREE TO ARBITRATE ANY DISPUTE IDENTIFIED ABOVE. 
  

			
	                     
(Company)
	 	                     
(Employee)

  
 IN WITNESS WHEREOF,
the Company and Recipient have executed this Restricted Stock Grant effective as of the Effective Grant Date. 
  

									
	 CALLAWAY GOLF COMPANY
	 	 	 	 RECIPIENT

				
	 By:
	 	 	 	 	 	 

  

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 EXHIBIT A 
  

A “Change in Control” means the following and shall be deemed to occur if any of the following events occurs: 
  
 (a) Any person, entity or group, within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) but excluding the Company and its subsidiaries and any employee benefit or stock ownership plan of the Company or its subsidiaries and also excluding
an underwriter or underwriting syndicate that has acquired the Company’s securities solely in connection with a public offering thereof (such person, entity or group being referred to herein as a “Person”) becomes the beneficial owner
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either the then outstanding shares of Common Stock or the combined voting power of the Company’s then outstanding securities entitled to vote generally in
the election of directors; or 
  
 (b) Individuals
who, as of the effective date hereof, constitute the Board of Directors of the Company (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of Directors of the Company, provided that any individual
who becomes a director after the effective date hereof whose election, or nomination for election by the Company’s shareholders, is approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be
considered to be a member of the Incumbent Board unless that individual was nominated or elected by any Person having the power to exercise, through beneficial ownership, voting agreement and/or proxy, 20% or more of either the outstanding shares of
Common Stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors, in which case that individual shall not be considered to be a member of the Incumbent Board
unless such individual’s election or nomination for election by the Company’s shareholders is approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board; or 
  
 (c) Consummation by the Company of the sale, lease, exchange
or other disposition (in one transaction or a series of related transactions) by the Company of all or substantially all of the Company’s assets or a reorganization or merger or consolidation of the Company with any other person, entity or
corporation, other than 
  
 (i) a reorganization
or merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto (or, in the case of a reorganization or merger or consolidation that is preceded or accomplished by an acquisition or series
of related acquisitions by any Person, by tender or exchange offer or otherwise, of voting securities representing 5% or more of the combined voting power of all securities of the Company, immediately prior to such acquisition or the first
acquisition in such series of acquisitions) continuing to represent, either by remaining outstanding or by being converted into voting securities of another entity, more than 50% of the combined voting power of the voting securities of the Company
or such other entity outstanding immediately after such reorganization or merger or consolidation (or series of related transactions involving such a reorganization or merger or consolidation), or 
  
 (ii) a reorganization or merger or consolidation effected to
implement a recapitalization or reincorporation of the Company (or similar transaction) that does not result in a material change in beneficial ownership of the voting securities of the Company or its successor; or 
  
 (d) Approval by the shareholders of the Company or an order
by a court of competent jurisdiction of a plan of complete liquidation or dissolution of the Company.Form of Performance Unit Grant for Officers

 Exhibit 10.21 
  

					
	Callaway Golf Company	  	Recipient:	  	 
	Performance Unit Grant	  	Effective Grant Date:	  	 
	 	  	Number of Units:	  	 
	 	  	Plan:	  	2004 Equity Incentive Plan

  
 CALLAWAY GOLF COMPANY,
a Delaware corporation (the “Company”), has elected to grant to you, the Recipient named above, a performance share unit award subject to the restrictions and on the terms and conditions set forth below. Terms not otherwise defined
in this Performance Unit Grant will have the meanings ascribed to them in the Plan identified above (the “Plan”). 
  

	1.	Governing Plan. The Recipient hereby acknowledges receipt of a copy of the Plan and a Prospectus for the Plan (the “Plan Prospectus”). This
Performance Unit Grant is subject in all respects to the applicable provisions of the Plan, which are incorporated herein by this reference. In the case of any conflict between the provisions of the Plan and this Performance Unit Grant, the
provisions of the Plan will control. 

  

	2.	Grant of Performance Unit. Effective as of the Effective Grant Date identified above, the Company has granted and issued to the Recipient the Number of Performance
Units with respect to the Company’s Common Stock identified above (the “PSUs”), subject to the terms, conditions and restrictions set forth in this Performance Unit Grant. 

  

	3.	Restrictions on the PSU. The PSU is subject to the following restrictions: 

  

	 	(a)	No Transfer. The PSU and the shares of Common Stock it represents may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of or encumbered
until shares are actually issued when the restrictions set forth in paragraph 4 expire, and any additional requirements or restrictions contained in this Performance Unit Grant have been satisfied, terminated or waived by the Company in
writing. 

  

	 	(b)	Cancellation of Unvested Shares. In the event Recipient ceases to be an employee of the Company or its subsidiary for any reason before the restrictions set forth in
paragraph 4 expire, this award shall be cancelled and no additional shares of Common Stock shall be issued pursuant hereto; provided, however, that the Compensation and Management Succession Committee of the Board of Directors (the
“Committee”) or its designee may, in its discretion, determine not to cancel and void all or part of such unvested award, in which case the Committee or its designee may impose whatever conditions it considers appropriate.

  

	4.	Lapse of Restrictions. The restrictions imposed under paragraph 3 will lapse and expire, and the PSU will vest, in accordance with the following:

  

	 	(a)	 Vesting Schedule. Subject to earlier cancellation, and subject to the accelerated vesting provisions, if any, set forth in any employment agreement
between Recipient and the Company or its subsidiary, as the same may be amended, modified, extended or renewed from time to time, the restrictions imposed under paragraph 3 will lapse and be removed in accordance with the vesting schedule set
forth in Exhibit B attached hereto (the “Vesting Schedule”). 

	 	 
The Board of Directors or its designee, however, may, in its discretion, accelerate the Vesting Schedule (in which case, the Committee or designee may impose
whatever conditions it considers appropriate on the accelerated portion). In addition, the restrictions imposed under paragraph 3 will automatically lapse and be removed immediately prior to any Change in Control, if the Recipient is an
employee or consultant of the Company or its subsidiary at that time, provided, however, that the Committee, in its sole discretion, may provide that such restrictions do not automatically lapse immediately prior to any such Change in
Control, and instead provide that the PSUs shall continue under the same terms and conditions or shall continue under the same terms and conditions with respect to shares of a successor company that may be issued in exchange or settlement of such
PSUs in connection with a Change in Control. Notwithstanding the foregoing, if the Committee elects to provide that such restrictions do not lapse in connection with a Change in Control and Recipient’s employment is terminated for any reason
within one year following such Change in Control, then such restrictions shall lapse and be removed immediately upon such termination of employment. For purposes hereof, “Change in Control” shall have the meaning set forth in Exhibit
A attached hereto. 

  

	 	(b)	Effect of Vesting. Unless deferred under a deferred compensation plan sponsored by the Company, effective as of the date each PSU vests, the Company shall deliver to
the Recipient the number of shares of Common Stock represented by the PSU that vest on such date in accordance with Exhibit B attached hereto. 

  

	 	(c)	Payment of Taxes. Upon issuance of Common Stock in accordance with the foregoing, Recipient must pay in the form of a check or cash or other cash equivalents to the
Company such amount as the Company determines it is required to withhold under applicable laws as a result of such issuance. In this regard, Recipient authorizes the Company and/or its subsidiary to withhold all applicable tax-related items legally
payable by Recipient from his or her wages or other cash compensation paid to Recipient by the Company and/or its subsidiary or from proceeds of the sale of shares of Common Stock. Alternatively, or in addition, if permissible under local law, the
Company may (1) sell or arrange for the sale of shares of Common Stock that Recipient acquires to meet the withholding obligation for tax-related items, and/or (2) withhold from the shares of Common Stock otherwise issuable to Recipient
upon the vesting of the PSU that number of shares having an aggregate Fair Market Value (as defined in the Plan), determined as of the date the withholding tax obligation arises, equal to the amount of the total withholding tax obligation; provided,
however, that the number of shares so withheld shall not have an aggregate Fair Market Value in excess of the minimum required withholding. Recipient acknowledges that the ultimate liability for all tax-related items legally due by Recipient is and
remains Recipient’s responsibility and that Company and/or Recipient’s employer (a) make no representations or undertakings regarding the treatment of any tax-related items in connection with any aspect of the PSU grant, including the
grant or vesting of the PSU, the subsequent sale of shares of Common Stock acquired pursuant to such vesting and the receipt of any dividends; and (b) do not commit to structure the terms of the grant or any aspect of the PSU to reduce or
eliminate Recipient’s liability for tax-related items. 

  

	 	5.	Voting and Other Rights. Notwithstanding anything to the contrary in the foregoing, until the issuance of shares of Common Stock pursuant to Section 4(b), the
Recipient shall not have any right in, to or with respect to any of the shares of Common Stock (including any voting rights or rights with respect to dividends paid on the Common Stock) issuable under this Agreement until the shares are actually
transferred to the Recipient following the applicable vesting date. 

  

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	 	6.	Taxable Event. The Recipient acknowledges that the PSU will have significant tax consequences to the Recipient and Recipient is hereby advised to consult
with Recipient’s own tax advisors concerning such tax consequences. A general description of the U.S. federal income tax consequences related to awards under the Plan is set forth in the Plan Prospectus. 

  

	 	7.	Severability. The provisions of this Agreement shall be deemed to be severable and the invalidity or unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any person or any circumstance, is held to be invalid or unenforceable under present or future laws effective during the term of this
Agreement, such provision shall be fully severed, and in lieu thereof there shall automatically be added as part of this Agreement a suitable and equitable provision in order to carry out, so far as may be valid and enforceable, the intent and
purpose of such invalid or unenforceable provision. 

  

	 	8.	Governing Law. This Performance Unit Grant will be governed by and construed in accordance with the laws of the State of Delaware and applicable federal law.

  

	 	9.	Irrevocable Arbitration of Disputes. 

  
 (a) You and the Company agree that any dispute, controversy or claim arising hereunder or in any way related to this Agreement, its
interpretation, enforceability, or applicability, that cannot be resolved by mutual agreement of the parties shall be submitted to binding arbitration. The parties agree that arbitration is the parties’ only recourse for such claims and hereby
waive the right to pursue such claims in any other forum, unless otherwise provided by law. Any court action involving a dispute which is not subject to arbitration shall be stayed pending arbitration of arbitrable disputes. 
  
 (b) You and the Company agree that the arbitrator shall
have the authority to issue provisional relief. You and the Company further agree that each has the right, pursuant to California Code of Civil Procedure section 1281.8, to apply to a court for a provisional remedy in connection with an arbitrable
dispute so as to prevent the arbitration from being rendered ineffective. 
  
 (c) Any demand for arbitration shall be in writing and must be communicated to the other party prior to the expiration of the applicable statute of limitations. 
  
 (d) The arbitration shall be administered by JAMS
pursuant to its Employment Arbitration Rules and Procedures. The arbitration shall be conducted in San Diego by a former or retired judge or attorney with at least 10 years experience in employment-related disputes, or a non-attorney with like
experience in the area of dispute, who shall have the power to hear motions, control discovery, conduct hearings and otherwise do all that is necessary to resolve the matter. The parties must mutually agree on the arbitrator. If the parties cannot
agree on the arbitrator after their best efforts, an arbitrator will be selected from JAMS pursuant to its Employment Arbitration Rules and Procedures. The Company shall pay the costs of the arbitrator’s fees. 
  
 (e) The arbitration will be decided upon a written
decision of the arbitrator stating the essential findings and conclusions upon which the award is based. The 

  

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arbitrator shall have the authority to award damages, if any, to the extent that they are available under applicable law(s). The arbitration award shall
be final and binding, and may be entered as a judgment in any court having competent jurisdiction. Either party may seek review pursuant to California Code of Civil Procedure section 1286, et seq. 
  
 (f) It is expressly understood that the parties have
chosen arbitration to avoid the burdens, costs and publicity of a court proceeding, and the arbitrator is expected to handle all aspects of the matter, including discovery and any hearings, in such a way as to minimize the expense, time, burden and
publicity of the process, while assuring a fair and just result. In particular, the parties expect that the arbitrator will limit discovery by controlling the amount of discovery that may be taken (e.g., the number of depositions or interrogatories)
and by restricting the scope of discovery only to those matters clearly relevant to the dispute. However, at a minimum, each party will be entitled to at least one (1) deposition and shall have access to essential documents and witnesses as
determined by the arbitrator. 
  
 (g) The
provisions of this Section shall survive the expiration or termination of the Agreement, and shall be binding upon the parties. 
  
 THE PARTIES HAVE READ SECTION 9 AND IRREVOCABLY AGREE TO ARBITRATE ANY DISPUTE IDENTIFIED ABOVE. 
  

			
	              (Company)
	  	            
(Employee)                    

  
 IN WITNESS WHEREOF,
the Company and Recipient have executed this Performance Unit Grant effective as of the Effective Grant Date. 
  

									
	 CALLAWAY GOLF COMPANY
	 	 	 	 RECIPIENT

				
	 By:
	 	 	 	 	 	 

  

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 EXHIBIT A 
  

A “Change in Control” means the following and shall be deemed to occur if any of the following events occurs: 
  
 (a) Any person, entity or group, within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) but excluding the Company and its subsidiaries and any employee benefit or stock ownership plan of the Company or its subsidiaries and also excluding
an underwriter or underwriting syndicate that has acquired the Company’s securities solely in connection with a public offering thereof (such person, entity or group being referred to herein as a “Person”) becomes the beneficial owner
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either the then outstanding shares of Common Stock or the combined voting power of the Company’s then outstanding securities entitled to vote generally in
the election of directors; or 
  
 (b) Individuals
who, as of the effective date hereof, constitute the Board of Directors of the Company (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of Directors of the Company, provided that any individual
who becomes a director after the effective date hereof whose election, or nomination for election by the Company’s shareholders, is approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be
considered to be a member of the Incumbent Board unless that individual was nominated or elected by any Person having the power to exercise, through beneficial ownership, voting agreement and/or proxy, 20% or more of either the outstanding shares of
Common Stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors, in which case that individual shall not be considered to be a member of the Incumbent Board
unless such individual’s election or nomination for election by the Company’s shareholders is approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board; or 
  
 (c) Consummation by the Company of the sale, lease, exchange
or other disposition (in one transaction or a series of related transactions) by the Company of all or substantially all of the Company’s assets or a reorganization or merger or consolidation of the Company with any other person, entity or
corporation, other than 
  
 (i) a reorganization
or merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto (or, in the case of a reorganization or merger or consolidation that is preceded or accomplished by an acquisition or series
of related acquisitions by any Person, by tender or exchange offer or otherwise, of voting securities representing 5% or more of the combined voting power of all securities of the Company, immediately prior to such acquisition or the first
acquisition in such series of acquisitions) continuing to represent, either by remaining outstanding or by being converted into voting securities of another entity, more than 50% of the combined voting power of the voting securities of the Company
or such other entity outstanding immediately after such reorganization or merger or consolidation (or series of related transactions involving such a reorganization or merger or consolidation), or 
  
 (ii) a reorganization or merger or consolidation effected to
implement a recapitalization or reincorporation of the Company (or similar transaction) that does not result in a material change in beneficial ownership of the voting securities of the Company or its successor; or 
  
 (d) Approval by the shareholders of the Company or an order
by a court of competent jurisdiction of a plan of complete liquidation or dissolution of the Company. 

 Exhibit B 
  

Performance Units: 
  
 The performance units vest on January 27, 2009. Subject to achievement of the performance metrics described below, upon vesting, the recipient will
be entitled to the number of shares determined under the payout levels described below. For example, 1,000 performance units would equal 500 shares at Threshold performance; 1,000 shares at Target performance and 1,500 shares at Maximum performance.
There are no shares awarded below Threshold performance and no additional shares for exceeding Maximum performance. 
  
 Performance Metric: 
  

	 	•	 	Average Economic Profit Spread over 3-year period (i.e. 2006-2008) 

  
 Definitions: 
  

	 	•	 	Economic Profit Margin = Return on Invested Capital (ROIC) less Weighted Average Cost of Capital (WACC) 

  

	 	•	 	ROIC = Net Operating Profit After Tax (NOPAT) divided by Average Invested Capital 

  

	 	•	 	NOPAT excludes one time charges and stock option/restricted stock/performance share expenses and deferred compensation expenses 

  

	 	•	 	Invested Capital = Shareholders Equity plus Interest Bearing Debt 

  

	 	•	 	Invested Capital will be calculated as a five quarter average each year 

  

	 	•	 	WACC = Weighted Average Cost of Debt and Equity 

  

	 	•	 	WACC will be set at the beginning of each 3-year period and remain fixed over the performance period 

  
 Payout Levels: 
  

	 	•	 	Target (100% payout of performance shares) 

  

	 	•	 	Average Economic Profit Spread = 0.75% 

  

	 	•	 	Average ROIC = 11.25% 

  

	 	•	 	WACC = 10.50% 

  

	 	•	 	Threshold (50% payout of performance shares) 

  

	 	•	 	Average Economic Profit Spread = 0.00% 

  

	 	•	 	Average ROIC = 10.50% 

  

	 	•	 	WACC = 10.50% 

  

	 	•	 	Maximum (150% payout of performance shares) 

  

	 	•	 	Average Economic Profit Spread = 1.50% 

  

	 	•	 	Average ROIC = 12.00% 

  

	 	•	 	WACC = 10.50% 

  
 Performance between payout levels will be interpolated.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}]]