EXHIBIT 10.8

RED HAT, INC.

Red Hat, Inc. 2004 Long-Term Incentive Plan, as amended and restated

Director Deferred Stock Unit Agreement (Vested)

Cover Sheet

This Agreement evidences the grant by Red Hat, Inc., a Delaware corporation (the
“Company”), on the date set forth below (the “Grant Date”) to the person named
below (the “Director” or “Participant”) of a Deferred Stock Unit Award (the
“Award”) of the number of deferred stock units listed below (the “Deferred Stock
Units”). Each unit represents the right to receive one share of the Company’s
common stock, $.0001 par value per share (“Common Stock”). This Award is subject
to the terms and conditions specified in the Red Hat, Inc. 2004 Long-Term
Incentive Plan, as amended and restated (the “Plan”) and in the Agreement,
consisting of this Cover Sheet and the attached Exhibit A.

 

Director Name:

   <PARTICIPANT NAME>

Grant Date:

   <GRANT DATE>

Number of Deferred Stock Units:

   <Number of shares>

Payment Date:

   Payment will be made upon termination of service as director or upon certain
other events, as set forth in the Agreement.

 

  

RED HAT, INC.

100 East Davie Street

Raleigh, North Carolina 27601

(electronically accepted)

   By: /s/                    

(Director Signature)

   Name:    Title:

By accepting this Award, the Director hereby (i) acknowledges that a copy of the
Plan and a copy of the Plan prospectus have been delivered to the Director and
additional copies thereof are available upon request from the Company’s Equity
Compensation Department and can also be accessed electronically,
(ii) acknowledges receipt of a copy of this Cover Sheet, and Exhibit A
(collectively, the “Agreement”) and accepts the Award subject to all the terms
and conditions of the Plan and the Agreement; (iii) represents that the Director
has read and understands the Plan, the Plan prospectus and the Agreement, and
(iv) acknowledges that there are tax consequences related to the Award, some of
which may vary by Director, and that the Director should consult a tax advisor
to determine his or her actual tax consequences. The Director must accept this
Award electronically, within thirty (30) days following notification of the
grant, pursuant to the online acceptance procedure established by the Company;
otherwise, the Company may, in its sole discretion, rescind the Award in its
entirety.

 

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EXHIBIT A

RED HAT, INC.

Red Hat, Inc. 2004 Long-Term Incentive Plan, as amended and restated

Director Deferred Stock Unit Agreement (Vested)

Terms and Conditions

 

1. Grant of Deferred Stock Units.

The Award is granted pursuant to and is subject to and governed by the Plan and
the terms of this Agreement. Unless otherwise defined in this Agreement,
capitalized terms used herein shall have the same meaning as in the Plan. The
Shares of Common Stock that are issuable after the Deferred Stock Units have
been earned are referred to in this Agreement as “Shares.” The Deferred Stock
Units shall be granted to the Participant without payment of consideration
(other than the continued performance of services).

 

2. Deferred Stock Unit Account.

The Company shall credit to a bookkeeping account (the “Account”) maintained by
the Company for the Participant’s benefit the Deferred Stock Units, each of
which shall be deemed to be the equivalent of one Share.

Whenever any cash dividends are declared on the Shares, on the date such
dividend is paid, the Company will credit to the Account of the Participant a
number of additional Deferred Stock Units equal to the result of dividing
(i) the product of the total number of Deferred Stock Units credited to the
Participant’s Account on the record date for such dividend and the per share
amount of such dividend by (ii) the Fair Market Value of one Share, on the date
such dividend is paid by the Company to the holders of Shares. The Participant
shall have no other rights as a shareholder with respect to the Shares
underlying the Deferred Stock Units.

 

3. Vesting.

The Deferred Stock Units shall be fully vested as of the Grant Date.

 

4. Payment of the Account.

The Company shall make a payment to the Participant in Shares as provided in
Section 5 with respect to the number of vested Deferred Stock Units then
credited to the Participant’s Account on the date previously elected by the
Director, or if earlier, the Director’s death, becoming disabled (as defined in
Section 409A of the Code (“Section 409A”)), cessation of service as a director,
or upon a Change in Control (as defined in the Plan) provided that such Change
in Control is a permissible distribution event under Section 409A(a)(2)(A)(v)
(the “Payment Date”).

 

5. Form of Payment.

Payments pursuant to Section 4 shall be made in Shares equal to the number of
vested Deferred Stock Units in the Participant’s Account on the Payment Date.
Such payment shall be made as soon as practicable, but not later than 90 days,
after the Payment Date.

 

6. Beneficiary.

In the event of the Participant’s death prior to payment of the vested Deferred
Stock Units credited to the Participant’s Account, payment shall be made to the
last person or persons designated by the Participant in writing prior to the
Participant’s death (“Beneficiary”) or, if no such Beneficiary survives the
Participant, such payment shall be made to the Participant’s estate.

 

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7. Source of Payments.

The Participant’s right to receive payment under this Agreement shall be an
unfunded entitlement and shall be an unsecured claim against the general assets
of the Company. The Participant has only the status of a general unsecured
creditor hereunder, and this Agreement constitutes only a promise by the Company
to pay the value of the Account on any required payment date.

 

8. Restrictions on Transfer.

(a) The Participant shall not sell, assign, transfer, pledge, hypothecate or
otherwise encumber or dispose of any Deferred Stock Units, either voluntarily or
by operation of law. Any attempt to dispose of any Deferred Stock Units in
contravention of the above restriction shall be null and void and without
effect.

(b) The Company shall not be required (i) to transfer on its books any of the
Deferred Stock Units which have been transferred in violation of any of the
provisions set forth herein or (ii) to treat as the owner of such Deferred Stock
Units any transferee to whom such Deferred Stock Units have been transferred in
violation of any of the provisions contained herein.

 

9. Adjustments for Capital Changes.

The Plan contains provisions covering the treatment of Deferred Stock Units in a
number of contingencies such as stock split and mergers. Provisions in the Plan
for such adjustments are hereby made applicable hereunder and are incorporated
herein by reference.

10.    Data Privacy. The Participant hereby explicitly and unambiguously
consents to the collection, use and transfer, in electronic or other form, of
the Participant’s personal data as described in this Agreement and any other
Award materials by the Company, for the purpose of implementing, administering
and managing the Participant’s participation in the Plan.

The Participant understands that the Company may hold certain personal
information about the Participant, including, but not limited to, the
Participant’s name, home address and telephone number, e-mail address, date of
birth, social insurance number or other identification number, salary,
nationality, job title, any shares of stock or directorships held in the Company
or any Affiliate, details of all Deferred Stock Units or any other entitlement
to shares of stock awarded, canceled, exercised, vested, unvested or outstanding
in Participant’s favor (“Personal Data”), for the purpose of implementing,
administering and managing the Plan.

The Participant understands that Personal Data will be transferred to any stock
plan service provider which is, presently or in the future, assisting the
Company with the implementation, administration and management of the Plan. The
Participant understands that these recipients of Personal Data may be located in
the United States or elsewhere, and that the recipients’ country (e.g., the
United States) may have different data privacy laws and protections than the
Participant’s country. The Participant understands that he or she may request a
list with the names and addresses of any potential recipients of Personal Data
by contacting the Participant’s local human resources representative. The
Participant authorizes the Company and any other possible recipients which may
assist the Company (presently or in the future) with implementing, administering
and managing the Plan to receive, possess, use, retain and transfer Personal
Data, in electronic or other form, for the purpose of implementing,
administering and managing the Participant’s participation in the Plan,
including any requisite transfer of such Personal Data as may be required to a
broker or other third party with whom the Participant may elect to deposit any
Shares received upon vesting of the Deferred Stock Units. The Participant
understands that Personal Data will be held as long as is necessary to
implement, administer and manage the Participant’s participation in the Plan.
The Participant understands that he or she may, at any time, view Personal Data,
request additional information about the storage and processing of

 

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Personal Data, require any necessary amendments to Personal Data or refuse or
withdraw the consents herein, in any case without cost, by contacting in writing
the Participant’s local human resources representative. Further, the Participant
understands that he or she is providing the consents herein on a purely
voluntary basis. If the Participant does not consent, or if the Participant
later seeks to withdraw his or her consent, his or her service with the Company
will not be adversely affected; the only adverse consequence of refusing or
withdrawing the Participant’s consent is that the Company would not be able to
grant the Participant Deferred Stock Units or other equity awards or to
administer or maintain Deferred Stock Units or other equity awards granted to
the Participant prior or subsequent to such refusal or withdrawal. Therefore,
the Participant understands that refusal or withdrawal of consent may affect the
Participant’s ability to participate in the Plan. For more information on the
consequences of the Participant’s refusal to consent or withdrawal of consent,
the Participant understands that he or she may contact his or her local human
resources representative.

11. Miscellaneous.

(a) Notices. All notices hereunder shall be in writing and shall be deemed given
when sent by certified or registered mail postage prepaid, return receipt
requested, if to the Director, at the most recent address shown on the records
of the Company, and if to the Company, to the Company’s principal office,
attention of the Corporate Secretary.

(b) Entire Agreement; Modification. This Agreement (including the cover sheet)
and the Plan constitute the entire agreement between the parties relative to the
subject matter hereof, and supersede all other communications between the
parties relating to the subject matter of this Agreement. This Agreement may be
modified, amended or rescinded by the Company as it shall deem advisable,
subject to any requirement for stockholder approval imposed by applicable law,
the Plan or other applicable rules, including, without limitation, the rules of
the stock exchange on which the Shares are listed; provided that, no amendment
or modification of this Agreement shall materially impair the rights of any
Participant without such Participant’s consent. Notwithstanding the foregoing
provision, no such consent shall be required with respect to any amendment or
modification if the Committee determines in its sole discretion that (i) such
amendment or modification is not reasonably likely to significantly reduce the
benefits provided under the Award or that the Participant has received adequate
compensation for any such reduction, or (ii) such amendment or modification,
including cancellation of the Award granted under this Agreement, is necessary
or advisable in order to comply with, or avoid adverse consequences due to
changes in the laws or rules applicable to the Company or the Participant that
the Company considers significant.

(c) Plan Governs. This Agreement is subject to all terms and provisions of the
Plan. In the event of a conflict between one or more provisions of this
Agreement and one or more provisions of the Plan, the provisions of the Plan
will govern.

(d) Severability. The invalidity, illegality or unenforceability of any
provision of this Agreement shall in no way affect the validity, legality or
enforceability of any other provision.

(e) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the heirs, legatees, distributees, executors and administrators of
the Participant and the successors and assigns of the Company.

(f) Participant’s Acceptance. The Company is not providing any tax, legal or
financial advice, nor is the Company making any recommendations regarding
Participant’s participation in the Plan, receipt of this Deferred Stock Unit
Agreement or Participant’s acquisition or sale of the underlying Shares. The
Participant is urged to read this Agreement carefully and to consult with his or
her own personal tax, legal and financial advisors regarding the terms and
consequences of this Agreement and the legal and binding effect of this
Agreement. By virtue of his or her acceptance of this Agreement, the Participant
is deemed to have accepted and agreed to all of

 

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the terms and conditions of this Award and the provisions of the Plan, including
as binding, conclusive and final all decisions or interpretations of the
Committee upon any questions arising under the Plan or this Award.

(g) Section 409A. This Agreement and the Deferred Stock Units are intended to
comply with the requirements of Section 409A and shall be construed consistently
therewith and shall be interpreted in a manner consistent with that intention.
Terms defined in the Agreement shall have the meanings given such terms under
Section 409A if and to the extent required to comply with Section 409A.
Notwithstanding any other provision of this Agreement, the Committee reserves
the right, to the extent the Committee deems necessary or advisable, in its sole
discretion, to unilaterally amend the Plan and/or this Agreement to ensure that
all Deferred Stock Units are awarded and administered in a manner that complies
with Section 409A. If and to the extent any portion of any payment, compensation
or other benefit provided to the Participant in connection with termination of
service is determined to constitute “nonqualified deferred compensation” within
the meaning of Section 409A and the Participant is a specified employee as
defined in Section 409A(a)(2)(B)(i) of the Code, as determined by the Company in
accordance with its procedures, by which determination the Participant hereby
agrees that he or she is bound, such portion of the payment, compensation or
other benefit shall not be paid before the day that is six months plus one day
after the date of separation from service (as determined under Section 409A (the
“New Payment Date”)), except as Section 409A may then permit. The aggregate of
any payments that otherwise would have been paid to the Participant during the
period between the date of separation from service and the New Payment Date
shall be paid to the Participant in a lump sum on such New Payment Date, and any
remaining payments will be paid on their original schedule. Notwithstanding the
foregoing, the Company, its Affiliates, Directors, officers and agents shall
have no liability to the Participant, or any other party, if an Award that is
intended to be compliant with Section 409A is not so compliant, or for any
action taken by the Committee or its delegates.

(h) Governing Law/Choice of Venue. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of Delaware, without giving
effect to the principles of the conflicts of laws thereof. For purposes of
litigating any dispute that arises directly or indirectly from the relationship
of the parties, evidenced by this Award or the Agreement, the parties hereby
submit to and consent to the exclusive jurisdiction of the State of North
Carolina and agree that such litigation shall be conducted only in the courts of
Wake County, North Carolina, or the federal courts for the United States for the
Tenth District of North Carolina, and no other courts, where this Award is made
and/or to be performed.

(i) Administrator Authority. The Committee will have the power to interpret the
Plan and this Agreement and to adopt such rules for the administration,
interpretation and application of the Plan as are consistent therewith and to
interpret or revoke any such rules (including, but not limited to, the
determination of whether or not any Deferred Stock Units have been earned). All
actions taken and all interpretations and determinations made by the Committee
in good faith will be final and binding upon Participant, the Company and all
other interested persons.

 

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