Quarterly Report — Form 10-Q Filing Table of Contents
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THIS
AGREEMENT(the “Agreement”), made as of the day of
,
20 , by and between Take-Two
Interactive Software, Inc.(the “Company”)
and
(the “Participant”).
W I T N E S S E T H:
WHEREAS, the Company has adopted the Take-Two
Interactive Software, Inc. 2009 Stock Incentive Plan (the “Plan”), a copy of which has been delivered
to the Participant, which is administered by the Compensation Committee (the “Committee”) of the Company’s Board of
Directors (the “Board”); and
WHEREAS, pursuant to Section 8.1
of the Plan, the Committee may grant to Non-Employee Directors shares of the
Company’s common stock, par value $0.01 per share (“Common Stock”); and
WHEREAS, such shares of Common Stock
granted to the Participant hereunder are to be subject to certain restrictions
prior to the vesting thereof.
NOW, THEREFORE, for and in consideration
of the mutual promises herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:
1. Grant of
Shares. Subject to the restrictions, terms and
conditions of this Agreement, the Company granted to the Participant on
,
20 (the “Grant
Date”)
[ ]
shares of duly authorized, validly issued, fully paid and non-assessable Common
Stock (the “Shares”). If the Participant is a new director, to the
extent required by law, the Participant shall pay to the Company the par value
($0.01) for each Share awarded to the Participant simultaneously with the
execution of this Agreement. Pursuant to
Sections 2, 3(c) and 3(d) hereof, the Shares are subject to certain
transfer restrictions and possible risk of forfeiture. While such restrictions are in effect, the
Shares subject to such restrictions shall be referred to herein as “Restricted
Stock.”
2. Restrictions
on Transfer. The Participant shall not sell, transfer,
pledge, hypothecate, assign or otherwise dispose of the Restricted Stock,
except as set forth in the Plan or this Agreement. Any attempted sale, transfer, pledge,
hypothecation, assignment or other disposition of the Restricted Stock in
violation of the Plan or this Agreement shall be void and of no effect and the
Company shall have the right to disregard the same on its books and records and
to issue “stop transfer” instructions to its transfer agent.
3. Restricted
Stock.
(a) Retention of Certificates. Promptly after the date of this Agreement,
the Company shall issue stock certificates representing the Restricted Stock
unless it elects to recognize such ownership through book entry or another
similar method pursuant to Section 8 herein. The stock certificates shall be registered in
the Participant’s name and shall bear any legend required under the Plan or Section 4(a) of
this Agreement. Unless held in book
entry form, such stock certificates shall be held in custody by the Company (or
its designated agent) until the restrictions thereon shall have lapsed. Upon the Company’s request, the Participant
shall deliver to the Company a duly signed stock power, endorsed in blank,
relating to the Restricted Stock. If the
Participant receives a stock dividend or extraordinary cash dividend on the
Restricted Stock or the shares of Restricted Stock are split or the Participant
receives any other shares, securities, moneys or property representing a
dividend on the Restricted Stock (other than regular cash dividends on and
after the date of this Agreement) or representing a distribution or return of
capital upon or in respect of the Restricted Stock or any part thereof, or
resulting from a split-up, reclassification or other like changes of the
Restricted Stock, or otherwise received in exchange therefor, and any warrants,
rights or options issued to the Participant in respect of the Restricted Stock
(collectively “RS Property”), the Participant will also immediately deposit
with and deliver to the Company any of such RS Property, including any
certificates representing shares duly endorsed in blank or accompanied by stock
powers duly executed in blank, and such RS Property shall be subject to the same
restrictions, including that of this Section 3(a), as the Restricted Stock
with regard to which they are issued and shall herein be encompassed within the
term “Restricted Stock.”
(b) Rights with Regard to Restricted Stock. The Participant will have the
right to vote the Restricted Stock, to receive and retain any dividends payable
to holders of Shares of record on and after the transfer of the Restricted
Stock (although such dividends shall be treated, to the extent required by
applicable law, as additional compensation for tax purposes if paid on
Restricted Stock and stock dividends will be subject to the restrictions
provided in Section 3(a)), and to exercise all other rights, powers and
privileges of a holder of Common Stock with respect to the Restricted Stock set
forth in the Plan, with the exceptions that:
(i) the Participant will not be entitled to delivery of the stock
certificate or certificates representing the Restricted Stock until the
Restriction Period shall have expired; (ii) the Company (or its designated
agent) will retain custody of the stock certificate or certificates
representing the Restricted Stock and the other RS Property during the
Restriction Period; (iii) no RS Property shall bear interest or be
segregated in separate accounts during the Restriction Period; and (iv) the
Participant may not sell, assign, transfer, pledge, exchange, encumber or
dispose of the Restricted Stock during the Restriction Period.
(c) Vesting.
(i) The Restricted
Stock shall become vested and cease to be Restricted Stock, and accordingly,
the restrictions contained in Sections 2, 3(a) and 3(b) shall no
longer apply (but the Shares shall remain subject to Section 5) pursuant
to the following schedule, which shall be cumulative; provided that the Participant
has not had a Termination at any time prior to the applicable vesting date:
Vesting Date
Number of Shares
2
(ii) There shall be no proportionate or
partial vesting in the periods prior to each vesting date and all vesting shall
occur only on the appropriate vesting date; provided that no Termination has
occurred prior to such date.
(iii) In the event of a Change in Control or in the event that the
Participant ceases to be a member of the Board for any of the following
reasons: (x) the Participant runs for re-election as a director at an
Annual Meeting of the Company’s stockholders and is not re-elected or (y) the
Participant is willing to stand for re-election at an Annual Meeting of the
Company’s stockholders and is not nominated by the Board to run for
re-election, then all unvested Shares shall immediately vest upon the happening
of any such events.
(iv) When any Shares
of Restricted Stock become vested, the Company shall promptly issue and
deliver, unless the Company is using a book entry or similar method pursuant to
Section 8, in which case the Company shall upon the Participant’s request
promptly issue and deliver, to the Participant a new stock certificate
registered in the name of the Participant for such Shares without the legend
set forth in Section 4(a) hereof and deliver to the Participant such Shares and any related other RS
Property (all of which is included in the term Restricted Stock), in each case free of all liens, claims and
other encumbrances (other than those created by the Participant),
subject to applicable withholding taxes.
(d) Termination. Except as set forth in Section 3(c)(iii) or
unless otherwise provided in a written agreement between the Participant and
the Company or any of its Affiliates in effect on the date hereof, upon a
Termination for any reason the Participant shall forfeit to the Company,
without compensation, other than repayment of any par value paid by the
Participant for such Shares (if any), any and all Restricted Stock (but no
vested Shares) and RS Property.
(e) Withholding. The Participant shall be solely responsible
for all applicable foreign, federal, state, provincial and local taxes with
respect to the Restricted Stock; provided, however, that at any time the
Company is required to withhold any such taxes, the Participant shall pay, or
make arrangements to pay, in a manner satisfactory to the Company, an amount
equal to the amount of all applicable federal, state and local or foreign taxes
that the Company is required to withhold at any time. In the absence of such arrangements, the
Company or one of its Affiliates shall have the right to withhold such taxes
from any amounts payable to the Participant, including, but not limited to, the
right to withhold Shares otherwise deliverable to the Participant
hereunder. In addition, any statutorily
required withholding obligation may be satisfied, as determined in the
Committee’s sole discretion, in whole or in part, at the Participant’s election,
in the form and manner prescribed by the Committee, by delivery of Shares of
Common Stock to the Company (including Shares issuable under this Agreement)
equal to the statutorily required withholding obligation.
(f) Section 83(b). If the Participant properly elects (as
permitted by Section 83(b) of the Code) within 30 days after the
Grant Date of the Restricted Stock to include in gross income for federal
income tax purposes in the year of issuance the fair market value of all or a
portion of such Restricted Stock, the Participant shall pay to the Company or
make arrangements
3
satisfactory to the Company to pay to the
Company upon such election, any federal, state or local taxes required to be withheld
with respect to the applicable Restricted Stock. If the Participant shall fail to make such
payment, the Company shall, to the extent permitted by law, have the right to
deduct from any payment of any kind otherwise due to the Participant any federal,
state or local taxes of any kind required by law to be withheld with respect to
the Restricted Stock, as well as the rights set forth in Section 3(e) hereof. The Participant acknowledges that it is the
Participant’s sole responsibility, and not the Company’s, to file timely and
properly the election under Section 83(b) of the Code and any
corresponding provisions of state tax laws if the Participant elects to utilize
such election.
(g) Delivery Delay. The delivery of any certificate representing
the Shares or other RS Property may be postponed by the Company for such period
as may be required for it to comply with any applicable foreign, federal or
state securities law, or any national securities exchange listing requirements
and the Company is not obligated to issue or deliver any securities if, in the
opinion of counsel for the Company, the issuance of such Shares shall
constitute a violation by the Participant or the Company of any provisions of
any applicable foreign, federal or state law or of any regulations of any
governmental authority or any national securities exchange.
4. Legend. All certificates representing
the Restricted Stock shall have endorsed thereon the following legends:
(a) “The anticipation,
alienation, attachment, sale, transfer, assignment, pledge, encumbrance or
charge of the shares of stock represented hereby are subject to the terms and
conditions (including forfeiture) of the Take-Two Interactive Software, Inc.
(the “Company”) 2009 Stock Incentive Plan (as the same may be amended or
supplemented from time to time, the “Plan”) and an agreement entered into
between the registered owner and the Company evidencing the award under the
Plan. Copies of such Plan and agreement
are on file at the principal office of the Company.”
(b) Any legend required to be
placed thereon by applicable blue sky laws of any state.
Notwithstanding
the foregoing, in no event shall the Company be obligated to issue a
certificate representing the Restricted Stock prior to the vesting dates set
forth above.
5. Securities
Representations. The Shares are being issued to the
Participant and this Agreement is being made by the Company in reliance upon
the following express representations and warranties of the Participant.
The
Participant acknowledges, represents and warrants that:
(a) the Participant has been
advised that the participant may be an “affiliate” within the meaning of Rule 144
under the Securities Act of 1933, as amended (the “Act”), currently or at the
time the Participant desires to sell the Shares following the vesting of the
Restricted Stock, and in this connection the Company is relying in part on the
Participant’s representations set forth in this section.
4
(b) If the Participant is deemed
an affiliate within the meaning of Rule 144 of the Act, the Shares must be
held indefinitely unless an exemption from any applicable resale restrictions
is available or the Company files an additional registration statement (or a “re-offer
prospectus”) with regard to such Shares and the Company is under no obligation
to register the Shares (or to file a “re-offer prospectus”).
(c) If the Participant is deemed
an affiliate within the meaning of Rule 144 of the Act, the Participant
understands that the exemption from registration under Rule 144 will not
be available unless (i) a public trading market then exists for the Common
Stock of the Company, (ii) adequate information concerning the Company is
then available to the public, and (iii) other terms and conditions of Rule 144
or any exemption therefrom are complied with; and that any sale of the Shares
may be made only in limited amounts in accordance with such terms and
conditions.
6. No
Obligation to Continue Service. This Agreement is not an agreement of
employment or consulting services. This
Agreement does not guarantee that the Company or its Affiliates will retain, or
continue to retain the Participant as a director or in any other capacity
during the entire, or any portion of the, term of this Agreement, including but
not limited to any period during which the Restricted Stock is outstanding, nor
does it modify in any respect the Company or its Affiliate’s right to terminate
or modify the Participant’s service or compensation.
7. Power of
Attorney.The Company, its successors and assigns, is
hereby appointed the attorney-in-fact, with full power of substitution, of the
Participant for the purpose of carrying out the provisions of this Agreement
and taking any action and executing any instruments which such attorney-in-fact
may deem necessary or advisable to accomplish the purposes hereof, which
appointment as attorney-in-fact is irrevocable and coupled with an
interest. The Company, as
attorney-in-fact for the Participant, may in the name and stead of the
Participant, make and execute all conveyances, assignments and transfers of the
Restricted Stock, Shares and property provided for herein, and the Participant
hereby ratifies and confirms all that the Company, as said attorney-in-fact,
shall do by virtue hereof. Nevertheless,
the Participant shall, if so requested by the Company, execute and deliver to
the Company all such instruments as may, in the judgment of the Company, be
advisable for the purpose.
8. Uncertificated
Shares. Notwithstanding anything else herein, to the
extent permitted under applicable foreign, federal or state law, the Company
may, issue the Restricted Stock in the form of uncertificated shares. Such uncertificated shares of Restricted
Stock shall be credited to a book entry account maintained by the Company (or
its designee) on behalf of the Participant.
If thereafter certificates are issued with respect to the uncertificated
shares of Restricted Stock, such issuance and delivery of certificates shall be
in accordance with the applicable terms of this Agreement.
9. Rights as a
Stockholder. The
Participant shall have all rights of a stockholder with respect to the
Restricted Stock, except with respect to the right to Transfer any shares of
Restricted Stock during the Restriction Period or except as otherwise
specifically provided for in this Agreement or the Plan.
5
10. Provisions
of Plan Control. This
Agreement is subject to all the terms, conditions and provisions of the Plan,
including, without limitation, the amendment provisions thereof, and to such
rules, regulations and interpretations relating to the Plan as may be adopted
by the Committee and as may be in effect from time to time. The Plan is incorporated herein by
reference. By signing and returning this
Agreement, the Participant acknowledges having received and read a copy of the
Plan and agrees to comply with it, this Agreement and all applicable laws and
regulations. Capitalized terms in this
Agreement that are not otherwise defined shall have the same meaning as set
forth in the Plan. If and to the extent
that this Agreement conflicts or is inconsistent with the terms, conditions and
provisions of the Plan, the Plan shall control, and this Agreement shall be
deemed to be modified accordingly. This
Agreement and the Plan contains the entire understanding of the parties with
respect to the subject matter hereof and supersedes any prior agreements
between the Company and the Participant with respect to the subject matter
hereof.
11. Notices. Any notice or communication
given hereunder (each a “Notice”)
shall be in writing and shall be sent by personal delivery, by courier or by
United States mail (registered or certified mail, postage prepaid and return receipt
requested), to the appropriate party at the address set forth below:
If
to the Participant, to the address for the Participant on file with the
Company;
or
such other address or to the attention of such other person as a party shall
have specified by prior Notice to the other party. Each Notice will be deemed given and
effective upon actual receipt (or refusal of receipt).
6
12.Acceptance. As required by Section 8.2(b) of
the Plan, the Participant shall forfeit the Restricted Stock if the Participant
does not execute this Agreement within a period of 60 days from the date the
Participant receives this Agreement (or such other period as the Committee
shall provide). In the event that the
Restricted Stock is not accepted within such time period, this Agreement shall
be null and void ab initio and
this award of Restricted Stock shall not be valid.
13.Governing
Law. All questions concerning the construction,
validity and interpretation of this Agreement will be governed by, and
construed in accordance with, the domestic laws of the State of Delaware,
without giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Delaware.
14.Consent to
Jurisdiction. In the event
of any dispute, controversy or claim between the Company or any Affiliate and
the Participant in any way concerning, arising out of or relating to the Plan
or this Agreement (a “Dispute”),
including without limitation any Dispute concerning, arising out of or relating
to the interpretation, application or enforcement of the Plan or this
Agreement, the parties hereby (a) agree and consent to the personal
jurisdiction of the courts of the State of New York located in New York County
and/or the Federal courts of the United States of America located in the
Southern District of New York (collectively, the “Agreed Venue”) for resolution of any such Dispute, (b) agree
that those courts in the Agreed Venue, and only those courts, shall have
exclusive jurisdiction to determine any Dispute, including any appeal, and (c) agree
that any cause of action arising out of this Agreement shall be deemed to have
arisen from a transaction of business in the State of New York. The parties also hereby irrevocably (i) submit
to the jurisdiction of any competent court in the Agreed Venue (and of the
appropriate appellate courts therefrom), (ii) to the fullest extent
permitted by law, waive any and all defenses the parties may have on the
grounds of lack of jurisdiction of any such court and any other objection that
such parties may now or hereafter have to the laying of the venue of any such
suit, action or proceeding in any such court (including without limitation any
defense that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum), and (iii) consent to service of
process in any such suit, action or proceeding, anywhere in the world, whether
within or without the jurisdiction of any such court, in any manner provided by
applicable law. Without limiting the
foregoing, each party agrees that service of process on such party pursuant to
a Notice as provided in Section 11 hereof shall be deemed effective
service of process on such party. Any
action for enforcement or recognition of any judgment obtained in connection
with a Dispute may enforced in any competent court in the Agreed Venue or in
any other court of competent jurisdiction.
15.Amendment. The Board or the Committee may, subject to the terms of the Plan, at any
time and from time to time amend, in whole or in part, any or all of the
provisions of this Agreement and may also suspend or terminate this Agreement
subject to the terms of the Plan. Except
as otherwise provided in the Plan, no modification or waiver of any of the provisions
of this Agreement shall be effective unless in writing by the party against
whom it is sought to be enforced.
7
16.Counterparts. This Agreement may be executed (including by
facsimile transmission) with counterpart signature pages or in separate
counterparts each of which shall be an original and all of which taken together
shall constitute one and the same agreement.
17.Miscellaneous.
(a) This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
heirs, legal representatives, successors and assigns.
(b) The failure of any party
hereto at any time to require performance by another party of any provision of
this Agreement shall not affect the right of such party to require performance
of that provision, and any waiver by any party of any breach of any provision
of this Agreement shall not be construed as a waiver of any continuing or
succeeding breach of such provision, a waiver of the provision itself, or a
waiver of any right under this Agreement.
(c) Although the Company makes
no guarantee with respect to the tax treatment of the Restricted Stock, the award of Restricted Stock pursuant to this
Agreement is intended to be exempt from Section 409A of the Code. With respect to any dividends and other RS
Property, however, this Agreement is intended to comply with the applicable
requirements of Section 409A of the Code relating to “short-term deferrals”
thereunder, and shall be limited, construed and interpreted in a manner so as
to comply therewith.
[Remainder of page intentionally left blank — signature page follows]
8
IN WITNESS WHEREOF, the parties have executed
this Agreement on the date and year first above written.
