--------------------------------------------------------------------------------

Exhibit 10.4
 
QAD INC. 2016 STOCK INCENTIVE PROGRAM
STOCK APPRECIATION RIGHTS AGREEMENT

This grant of stock appreciation rights (“SAR”) is made by QAD Inc. (the
“Company”) to _____________________ (the "Grantee") as of the Grant Date set
forth below, pursuant to the QAD Inc. 2016 Stock Incentive Program (the
“Program”) and this Stock Appreciation Rights Agreement (the “Agreement”).  The
Program Administrators administering the Program have selected Grantee to
receive the following SAR grant on the date specified in Section 1 (the "Grant
Date").

This Agreement entitles Grantee to receive a payment in shares of Class A common
stock of QAD Inc. (the “Class A Common Stock”) that reflects:

● the fair market value per share of Class A Common Stock on the date of
exercise (the "Exercise Value")

● less the fair market value per share of Class A Common Stock on the Grant Date
(the "Grant Price"), as specified in Section 1,

● multiplied by the number of shares of Class A Common Stock for which the SAR
has been granted (the “Grant Shares”), as specified in Section 1,

● on the terms and conditions of the Program and as set forth below, which
Grantee accepts and to which Grantee is bound by not rejecting the SARs within
thirty (30) days of the Grant Date.

1.    SAR Granted.

Grant Date
_____________________
Grant Price (U.S. dollars)
_____________________
Grant Shares
_____________________
Vesting Dates:
 
Tranche 1
_____________________
Tranche 2
_____________________
Tranche 3
_____________________
Tranche 4
_____________________
Expiration Date
_____________________

2.      Exercise.  The SAR shall be exercisable in all respects in accordance
with the terms of the Program, which are incorporated herein by this reference. 
Grantee shall have the right to exercise the SAR in accordance with the
following schedule:

(a) The SAR may not be exercised in whole or in part at any time prior to the
first anniversary of the Grant Date.

(b) Grantee may exercise the SAR on and after the Vesting Dates, as specified in
Section 1, as to one-fourth of the Grant Shares per each tranche.

(c) The right to exercise the SAR shall be cumulative.  Grantee may exercise
all, or from time to time any part, of the SAR for the maximum number of Grant
Shares that are exercisable under the SAR, but in no case may Grantee exercise
the SAR with regard to a fraction of a Grant Share, or for any Grant Share for
which the SAR is not then exercisable.

 
1

--------------------------------------------------------------------------------

3.      Payment Upon Exercise.  The payment due to Grantee upon exercise shall
be equal to a number of shares of Class A Common Stock with an aggregate fair
market value on the date of exercise equal to (i) the Exercise Value less the
Grant Price, multiplied by (ii) the number of Grant Shares being exercised.  The
payment shall be made in the form of shares of Class A Common Stock, rounded
down to the nearest whole number of shares of Class A Common Stock and subject
to applicable income and employment tax withholding.

4.      Term.  Except as otherwise provided in this Agreement or in the Program,
the SAR, to the extent not previously exercised, shall terminate on the date
specified in Section 1 (the "Expiration Date").  In no case shall the SAR and
this Agreement terminate later than the day immediately preceding the eighth
(8th) anniversary of the Grant Date.

5.     Withholding Taxes.  The SAR is subject to the condition that if at any
time the Company shall determine, in its sole and absolute  discretion, that the
satisfaction of withholding taxes or other withholding liabilities under any
federal, state, local or foreign laws is necessary or desirable as a condition
of, or in connection with, the grant, vesting or exercise of the SAR or any
portion thereof, or the delivery or purchase of shares pursuant thereto, then
such action shall not be effective unless and until such withholding shall have
been effected or obtained in a manner acceptable to the Company.  Such
withholding liabilities shall be satisfied by reducing the number of shares that
otherwise would be payable to Grantee on exercise of the SAR by a whole number
of shares having a Fair Market Value on the date of exercise equal to the
withholding liability, unless, in the Company’s sole and absolute discretion,
the Company determines to require or accept cash from Grantee.

6.      Termination of Service Other Than by Death or Disability.  If Grantee
ceases to provide continuous service in a role that is eligible to receive a SAR
under the Program (as determined in the sole and absolute discretion of the
Program Administrators) to the Company or any subsidiary (used herein as defined
in the Program), other than termination of Grantee’s employment by reason of
Grantee's disability or death, the SAR may be exercised, only to the extent it
had vested at the time of termination of such service and subject to the
Program, at any time within sixty (60) days after Grantee's termination of such
service, but not beyond the otherwise applicable term of the SAR.  Any unvested
SAR will be immediately and unconditionally forfeited without any action
required by Grantee or the Company as of the date of such termination of service
and any vested, but unexercised, SAR will be unconditionally forfeited without
any action required by Grantee or the Company as of the date sixty-one (61) days
after Grantee's termination of service, but in any case not beyond the otherwise
applicable term of the SAR.

For purposes of this Section 6, Grantee’s service relationship shall be treated
as continuing intact while Grantee is an active employee of the Company or any
of its subsidiaries, or on a bona fide leave of absence from such employment, or
is serving on the board of directors of the Company or any of its subsidiaries,
or is actively providing services as an independent contractor of the Company or
any of its subsidiaries, in each case as determined in the sole and absolute
discretion of the Program Administrators.

7.      Disability of Employee Grantee.  If Grantee ceases to be an employee due
to becoming totally and permanently disabled within the meaning of Section
22(e)(3) of the Internal Revenue Code, as determined in the sole and absolute
discretion of the Program Administrators, the SAR may be exercised, to the
extent it had vested at the time of termination of employment and subject to the
Program, at any time within one year after Grantee’s termination of employment
due to disability, but not beyond the otherwise applicable term of the SAR.

8.      Death of Employee Grantee.  If Grantee dies while an employee, the SAR
may be exercised, to the extent it had vested at the time of termination of
employment and subject to the Program, at any time within one year after
Grantee’s termination of employment due to death, by the executors or
administrators of Grantee's estate or by any person or persons who acquire the
SAR by will or the laws of descent and distribution, but not beyond the
otherwise applicable term of the SAR.
 
2

--------------------------------------------------------------------------------

9.      Rights as a Stockholder.  Grantee, or a transferee of Grantee, shall
have no rights as a stockholder of the Company with respect to any shares of
Class A Common Stock for which the SAR is exercisable until the date of the
issuance of such shares of Class A Common Stock pursuant to an exercise of the
SAR.  No adjustment shall be made for ordinary or extraordinary dividends
(whether in currency, securities or other property), distributions, or other
rights (including, but not limited to, the right to vote) for which the record
date is prior to the date such shares of Class A Common Stock are issued, except
as provided in the Program.

10.   Advisements.  Grantee shall be subject to and bound by the terms of this
Agreement and the Program. In addition, Grantee is hereby advised that the
following shall apply to the SAR:

(a)  Grantee shall be provided a copy of the Program and shall be bound by all
of the terms and provisions thereof, including the terms and provisions adopted
after the date of this Agreement, but prior to the completion of the vesting
period.  If and to the extent that any provision contained in this Agreement is
inconsistent with the Program, the Program shall govern.

(b)  As of the date of this Agreement, the Agreement and the Program set forth
the entire understanding between Grantee and the Company regarding the
acquisition of shares of Class A Common Stock underlying the SAR and supersede
all prior oral and written agreements pertaining to the SAR.

(c)  The Company and its subsidiaries hold certain personal information about
Grantee, including, but not limited to, Grantee's name, home address, telephone
number, date of birth, social security number or equivalent foreign
identification number, salary, nationality, job title and details of all SARs or
other entitlement to shares of QAD common stock awarded, canceled, exercised,
vested, unvested or outstanding, including personal information that may
constitute sensitive personal data within the meaning of applicable law
("Personal Data"). Personal Data includes, but is not limited to, the
information provided above and any changes thereto and other appropriate
personal and financial data about Grantee. The Company and its subsidiaries may
process any Personal Data and may transfer any Personal Data outside the country
in which Grantee is employed, including, but not limited to, the United States.
The legal persons for whom Personal Data is intended include, but are not
limited to, the Company, its subsidiaries and its agents.  Grantee is hereby
informed that Grantee has the right to access and make corrections to Grantee's
Personal Data by applying to the Chief People Officer of the Company or such
person’s designees.

(d)  The Company reserves the right to amend or terminate the Program at any
time, and the award of this SAR under the Program at one time does not in any
way obligate the Company or its subsidiaries to grant additional SARs in any
future year or in any given amount.  Grantee's participation in the Program is
voluntary.  This SAR and any future SARs under the Program are wholly
discretionary in nature, the value of which do not form part of any normal or
expected compensation for any purposes, including, but not limited to,
calculating any termination, severance, resignation, redundancy and end of
service payments, bonuses, long-service awards, pension and retirement benefits,
and similar payments, other than to the extent required by local law.

(e)  The future value of the shares of Class A Common Stock acquired by Grantee
under the Program is unknown and cannot be predicted with certainty and no claim
or entitlement to compensation or damages arises from the forfeiture of the SAR
or termination of the Program or the diminution in value of any shares of Class
A Common Stock acquired by Grantee under the Program.

11.   No Right to Continued Service.  Neither this SAR nor any terms contained
in this Agreement shall confer upon Grantee any express or implied right to be
retained in the service of the Company or any of its subsidiaries for any period
at all, nor restrict in any way the right of the Company or any such subsidiary,
which right is hereby expressly reserved, to terminate Grantee's service at any
time with or without cause.  Any right that Grantee may have to receive delivery
of shares of Class A Common Stock under this Agreement is earned only by
continuing as an employee or other service provider of the Company or any of its
subsidiaries at the will of the Company or such subsidiary, and satisfaction of
any other applicable terms and conditions contained in this Agreement and the
Program, and not through the act of being hired, being granted this SAR or
acquiring shares of Class A Common Stock hereunder.
 
3

--------------------------------------------------------------------------------

12.   Compliance with Laws, Regulations and Program Rules.  The award of this
SAR to Grantee and the obligation of the Company to deliver shares of Class A
Common Stock hereunder and the sale or disposition of shares of Class A Common
Stock received pursuant to the exercise of such SAR shall be subject to (a) all
applicable federal, state, local and foreign laws, rules and regulations, and
(b) any registration, qualification, approvals or other requirements imposed by
any government or regulatory agency or body which the Company shall, in its sole
discretion, determine to be necessary or applicable.  Moreover, shares of Class
A Common Stock shall not be delivered hereunder if such delivery would be
contrary to applicable law or the rules of any stock exchange.  Exercise of, and
receipt of shares under, this SAR shall be conditioned on Grantee’s compliance
with procedures established from time to time by the Program Administrators,
including, but not limited to, submission of such forms and documents as the
Program Administrators may require in their sole and absolute discretion.  The
number of shares of Class A Common Stock subject to the SAR granted hereunder
shall be adjusted as provided in the Program.

13.   Definitions.  All capitalized terms that are used in this Agreement that
are not defined herein have the meanings defined in the Program. In the event of
a conflict between the terms of the Program and the terms of this Agreement, the
terms of the Program shall prevail.

14.   Notices.  Any notice or other communication required or permitted
hereunder shall, if to the Company, be in accordance with the Program and, if to
Grantee, be in writing and delivered in person or via email or by registered
mail or certified mail or overnight courier, addressed to Grantee at Grantee's
last known email address or physical address, as applicable, as set forth in the
Company’s records.

15.   Severability. If any of the provisions of this Agreement should be deemed
unenforceable, the remaining provisions shall remain in full force and effect.

16.   Applicable Law.  This Agreement and this SAR shall be governed by and
construed in accordance with the laws of the State of Delaware.

17.   Arbitration.  Any dispute arising out of or in connection with this
Agreement and this SAR shall be submitted to binding arbitration in Santa
Barbara, California before a single arbitrator in accordance with Article 17 of
the General Provisions of the Program and the Rules referenced therein, all of
which are incorporated herein by this reference.

18.   Nontransferability.  This Agreement and this SAR may not be sold,
transferred, pledged, assigned, encumbered or otherwise alienated by either
party hereto, other than by will or by the laws of descent and distribution.

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the date of
acceptance.

 
QAD INC.
     
By:
 /s/  Daniel Lender
   
Daniel Lender
   
Chief Financial Officer

 
 
4

--------------------------------------------------------------------------------