Exhibit 10.36
CALLIDUS SOFTWARE INC.
RESTRICTED STOCK AGREEMENT
     This Restricted Stock Agreement (the “Agreement”), is made and entered into
between CALLIDUS SOFTWARE INC., a Delaware corporation (the “Company”) and
ROBERT H. YOUNGJOHNS (“Recipient”) residing at the above address. This award is
granted as an “inducement grant” under Nasdaq rules and is therefore being
granted outside the Company’s 2003 Stock Incentive Plan (as amended, the
“Plan”). However, for convenience, reference is made in this Agreement to
certain provisions of the Plan, and terms used but not defined herein have the
meaning set forth in the Plan.
     1. Notice of Grant
     Recipient has been granted shares of Common Stock of the Company (the
“Restricted Shares”), subject to the terms and conditions of this Agreement, as
follows:

     
Grant Number
   1,722
 
   
Date of Grant
   June 7, 2005
 
   
Total Number of Shares Granted
   28,000

     2. Vesting Schedule
     (a) The Restricted Shares shall become vested and nonforfeitable on May 31,
2006, subject to Recipient’s continuing to be a Service Provider on such date.
     (b) In the event Recipient’s service is terminated by the Company without
Cause (as defined in the Employment Agreement dated April 26, 2005 between
Recipient and the Company (the “Employment Agreement”) before the Vesting Date,
a portion of the Restricted Shares (determined by multiplying 28,000 by a
fraction, the numerator of which shall be the number of full months served by
Recipient since May 31, 2005 and the denominator of which shall be 12) shall
become vested and nonforfeitable.
     (c) If Recipient’s service as a Service Provider terminates for any reason
except as set forth in clause (b), then all Restricted Shares that have not
vested on or before the date of termination of employment shall automatically be
forfeited to the Company and all of Recipient’s rights with respect thereto
shall cease immediately upon termination.
     3. Tax Treatment. Any withholding tax liabilities incurred in connection
with the Restricted Shares becoming vested and non-forfeitable or otherwise
incurred in connection with the Restricted Shares shall be satisfied (i) by
either (x) Recipient paying to the Company in cash or by check an amount equal
to the minimum amount of taxes that the Company concludes it is required to
withhold under applicable law within one business day of the day the tax event
arises or (y) if allowed by the Administrator, the Company withholding a portion
of the Restricted Shares that have vested and become non-forfeitable having a
fair market value approximately equal to the minimum amount of taxes that the
Company concludes it is required to withhold under applicable law, and (ii) with
respect to any cash dividend or other distribution hereunder, by deducting
therefrom the minimum amount of taxes required to be withheld by the Company
under applicable law. Notwithstanding the foregoing, Recipient acknowledges and
agrees that he is responsible for all taxes that arise in connection with the
Restricted Shares becoming vested and non-forfeitable or otherwise incurred in
connection with the Restricted Shares.

 

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     4. Restrictions on Transfer. Recipient may not sell, transfer, pledge or
otherwise dispose of any of the Restricted Shares until after the applicable
shares have become vested and non-forfeitable on the schedule set forth above.
Recipient further agrees not to sell, transfer or otherwise dispose of any
shares at a time when applicable laws or Company policies prohibit a sale,
transfer or other disposition. Recipient agrees that, in order to ensure
compliance with the restrictions referred to herein, the Company may issue
appropriate “stop transfer” instructions to its transfer agent. The Company
shall not be required (i) to transfer on its books any Restricted Shares that
have been sold or otherwise transferred in violation of any of the provisions of
this Agreement or (ii) to treat as owner of such Restricted Shares or to accord
the right to vote or pay dividends to any purchaser or other transferee to whom
such Restricted Shares shall have been so transferred.
     5. Stock Certificates. Certificates evidencing the Restricted Shares shall
be issued by the Company and registered in the name of Recipient on the stock
transfer books of the Company. Unless otherwise determined by the Administrator,
such certificates shall remain in the physical custody of the Company or its
designee at all times until the applicable shares have become vested and
non-forfeitable.
     6. Stockholder Rights. Recipient will have the same voting and other rights
as the Company’s other stockholders with respect to each Restricted Share until
or unless such Restricted Share is forfeited pursuant to Section 2 hereof. In
the event of a stock split, a stock dividend or a similar change in Company
stock, the number of Restricted Shares will be adjusted accordingly and will be
subject to forfeiture pursuant to Section 2 hereof and the same restrictions as
the existing Restricted Shares. In the event of a cash dividend or other
distribution, such dividend or distribution will be subject to forfeiture
pursuant to Section 2 hereof and, at the discretion of the Administrator (as
defined in the Plan), the other restrictions contained herein.
     7. Representations and Acknowledgments of Recipient.
     (a) Recipient acknowledges that the Company has made available copies of
its annual report for the year ended December 31, 2004, and its most recent
quarterly report. Recipient acknowledges that he or she has had an opportunity
to ask questions of, and receive answers from, the Company regarding the terms
and conditions of the issuance of the Restricted Shares.
     (b) Recipient represents that he or she is able, without impairing his or
her financial condition, to hold the Restricted Shares for an indefinite period
and to suffer a complete loss of the value of the Restricted Shares. Recipient
understands the risk that the price at which Recipient disposes of the
Restricted Shares, if any, will be less than the amount of taxes withheld with
respect to the Restricted Shares.
     8. Spousal Consent. As a condition to the Company’s obligations under this
Agreement, the spouse of the Recipient shall execute and deliver to the Company
the Consent of Spouse attached hereto as Schedule 1.
     9. Retention Rights. The Restricted Shares and this Agreement do not give
Recipient the right to be retained by the Company or a subsidiary of the Company
in any capacity. The Company and its subsidiaries reserve the right to terminate
Recipient’s service at any time, with or without cause.
     10. Adjustments. In the event of a stock split, a stock dividend or a
similar change in Company stock, the number of shares covered by this Agreement
may be adjusted pursuant to the Plan.

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     11. Incorporation of Plan. This Option shall be subject to the authority of
the Administrator as set forth in Section 4(b) of the Plan and shall be subject
to Sections 13, 14 and 15 of the Plan, which are incorporated herein by
reference.
     12. Applicable Law. This Agreement will be interpreted and enforced under
the laws of the State of California (without regard to their choice-of-law
provisions).
     13. The Plan and Other Agreements. The text of the Plan is incorporated in
this Agreement by reference.
     This Agreement and the Plan constitute the entire understanding between
Recipient and the Company regarding this Agreement. Any prior agreements,
commitments or negotiations concerning the Restricted Shares are superseded.
This Agreement may be amended only by another written agreement, signed by both
parties.
     Recipient hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Administrator upon any questions arising
under this Agreement. Recipient further agrees to notify the Company upon any
change in the residence address indicated below.

     
RECIPIENT:
  CALLIDUS SOFTWARE, INC.
 
   
/s/ Robert H. Youngjohns
  By: /s/ Brian E. Cabrera
 
   
Signature
  Brian E. Cabrera, VP Corporate Development and General Counsel
 
   
Robert Youngjohns
 
   
Print Name
   

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Schedule 1
CONSENT OF SPOUSE
     I, Margaret Youngjohns, spouse of Robert H. Youngjohns, have read and
approve the foregoing Agreement. In consideration of granting of the shares of
Callidus Software Inc., as set forth in the Agreement, I hereby appoint my
spouse as my attorney-in-fact in respect to the exercise of any rights under the
Agreement and agree to be bound by the provisions of the Agreement insofar as I
may have any rights in said Agreement or any shares issued pursuant thereto
under the community property laws or similar laws relating to marital property
in effect in the state of our residence as of the date of the signing of the
foregoing Agreement.
     Signature: /s/ Margaret Youngjohns
     Date: June 7, 2005