Exhibit 10.24

 

FORM OF

CHORDIANT SOFTWARE, INC.

CEO AND CFO RESTRICTED STOCK AGREEMENT

 

This CEO AND CFO RESTRICTED STOCK AGREEMENT is entered into as of October 10,
2002 (the “Exchange Date”), by and between Chordiant Software, Inc., a Delaware
corporation (the “Company”) and Steve Vogel (“Grantee”), the Chief Financial
Officer of the Company.

 

RECITALS

 

A.    The Company has offered to Grantee, and Grantee has elected to accept the
Company’s offer, to exchange certain of Grantee’s stock options for restricted
shares of the Company’s Common Stock, par value $0.001.

 

B.    As partial consideration for Grantee being issued the restricted shares of
the Company’s Common Stock, Grantee must execute this Restricted Stock
Agreement, setting forth the rights and restrictions of the Restricted Stock.

 

AGREEMENT

 

The parties, intending to be legally bound, hereby agree as follows:

 

1.    GRANT OF RESTRICTED STOCK; PAYMENT FOR SHARES.

 

(a)    Grant of Shares.  Pursuant to and subject to the terms of the Company’s
[1999 Equity Incentive Plan] / [2000 Nonstatutory Equity Incentive Plan],
attached hereto as EXHIBIT A (the “Plan”), the Company hereby grants to Grantee
as of the Exchange Date              shares of the Company’s common stock, par
value $0.001 per share, subject to the restrictions set forth below (the
“Restricted Stock”).

 

(b)    Consideration.  The Company hereby acknowledges that the surrender of
certain stock options, as set forth on EXHIBIT B (the “Tendered Options”), by
Grantee constitutes all consideration for this grant of Restricted Stock.

 

2.    RESTRICTIONS AND RELATED TERMS.

 

(a)    Restrictions Generally.  Until they expire in accordance with Section
2(d) or 2(e), the following restrictions (the “Restrictions”) shall apply to the
Restricted Stock:

 

(i)    Grantee shall have no right to sell, transfer, assign, pledge, or
otherwise encumber or dispose of the Restricted Stock (except for transfers and
forfeitures to the Company); and

 

(ii)    the Restricted Stock shall be subject to a risk of forfeiture as set
forth in Section 2(c).

 

(b)    Rights as Stockholder.  Grantee shall be entitled to receive dividends on
the Restricted Stock when, as, and if dividends are declared and paid on the
Company’s common stock, shall be entitled to vote Restricted Stock on any matter
submitted to a vote of holders of the Company’s common stock, and shall have all
other rights of a stockholder of the Company, except as otherwise expressly
provided in this Section 2. Dividends other than regular quarterly dividends,
and any securities or property resulting from an adjustment under Section 7(d)
of the Plan, shall be subject to the Restrictions to the same extent as
Restricted Stock to which they relate.

 

(c)    Forfeiture of Restricted Stock.  If Grantee ceases to be employed by or
provide services to the Company (or any of its subsidiaries) for any reason
prior to the expiration of the Restrictions, the Restricted

 

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Stock as to which Restrictions have not previously expired and/or lapsed shall
be forfeited to the Company at the time of such cessation.

 

(d)    Vesting; Expiration of Restrictions.

 

(i)    Subject to the limitations contained in subparagraphs (c)(ii), (c)(iii)
and (c)(iv) below, the Restricted Stock shall vest, and the Restrictions shall
expire (such vesting and expiration and lapse of Restrictions, the “Vesting”):

 

(1)    For all shares of Restricted Stock granted in respect of Tendered Options
that would have been vested through December 31, 2002, had such Tendered Options
not been exchanged for Restricted Stock (the “Vested Options”), in equal
installments on February 15, 2003 (the “First Installment Date”), May 15, 2003
(the “Second Installment Date”), August 15, 2003 (the “Third Installment Date”),
November 15, 2003 (the “Fourth Installment Date”), February 15, 2004 (the “Fifth
Installment Date”) and March 15, 2004 (the “Sixth Installment Date”). The First,
Second, Third, Fourth, Fifth and Sixth Installment Dates are collectively
referred to as the “Installment Dates” or individually as the “Installment
Date.”

 

(2)    All shares of Restricted Stock granted in respect of Tendered Options
that are not Vested Options and would have vested as of December 31, 2003 if
such Tendered Options had not been exchanged for Restricted Stock (the “2003
Options”), shall vest, and the Restrictions thereon shall expire and lapse, over
the same number of quarters of 2004 over which such 2003 Options would have
vested had the 2003 Options not been exchanged, and the vesting dates for each
applicable quarter shall be on the Fifth Installment Date, the Sixth Installment
Date and on August 15, 2004 and November 15, 2004.

 

(3)    All shares of Restricted Stock granted in respect of Tendered Options
that are neither Vested Options nor 2003 Options and which would have fully
vested during 2004 (the “2004 Options”) had such 2004 Options not been exchanged
for Registered Stock shall vest, and the Restrictions thereon shall expire and
lapse, in equal installments on the Fifth Installment Date, the Sixth
Installment Date and on the 15th of August 15, 2004 and November 15, 2004.

 

(4)    All shares of Restricted Stock granted in respect of Tendered Options
other than Vested Options, the 2003 Options or the 2004 Options and which would
have fully vested during 2005 (the “2005 Options”) shall vest, and the
Restrictions thereon shall expire and lapse, in equal installments on the 15th
of each February, May, August and November, starting in 2005, over the duration
of the remaining original vesting period of the exchanged or cancelled 2005
Options, such that the Restricted Stock exchanged for 2005 Options will be fully
vested as of the date such 2005 Options would have been fully vested if such
2005 Options were not exchanged or cancelled.

 

(ii)    The portion of Restricted Stock subject to Vesting on each Installment
Date (the “Conditional Vesting Amount”), shall so Vest only if the “Target EPS
Goals” or “Cumulative EPS Goals” (as each such term is defined below) have been
met by the Company for each such Installment Date.

 

(iii)    In the event that the Target EPS Goals are not met by the Company for
an Installment Date, the Conditional Vesting Amount subject to Vesting on such
date shall not Vest, and such amount shall be carried forward to the next
Installment Date (“Carried Forward Portion”). Any Carried Forward Portion
carried over to another Installment Period shall vest in such Installment Period
only if the Cumulative EPS Goals have been met for such Installment Period. All
such Carried Forward Portions may continue to be carried forward until the Sixth
Installment Date.

 

(iv)    In the event that the Target EPS Goals are not met by the Company for
the Sixth Installment Date, the Conditional Vesting Amount subject to Vesting on
such date, and the Conditional Vesting Amount carried over from any other prior
Installment Date, shall not Vest and such Restricted Stock shall be returned to
the Company for cancellation.

 

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(v)    No fractional share shall vest at any time, and any fractional shares
that are not vested as of the final vesting installment shall be combined and
shall vest at that time.

 

(vi)    Notwithstanding the foregoing, and provided the Restricted Stock has not
been forfeited pursuant to Section 2(c) of this Agreement, in the event of a
Change in Control, as defined in the Plan, the vesting of the Restricted Stock
shall be automatically accelerated immediately prior to the Change in Control
such that the Restricted Stock will be vested to the same extent as the
Restricted Stock would have been vested (in the absence of a Change in Control)
as of the date one (1) year following the date of the Change in Control.

 

(vii)    As set forth above, the Vesting of the Restricted Stock granted in
respect of Tendered Options shall be subject to the Company meeting earnings per
share goals (as defined below, the “Target EPS Goals” or the “Cumulative EPS
Goals,” together, the “EPS Goals”) for each respective Installment Date, as set
forth in the chart below. The EPS Goals shall be calculated by the Board of
Directors based on the total earnings of the Company (excluding expenses
associated with: (i) purchased in process research and development; (ii)
stock-based compensation expenses; (iii) amortization of acquired intangible
assets; (iv) integration related charges; (v) restructuring charges; and (vi)
other one time charges) divided by the number of shares then outstanding (as
reported in the latest public filing of the Company with the Securities and
Exchange Commission in the Company’s Quarterly Report on Form 10-Q, or Annual
Report on Form 10-K).

 

Quarter

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Target

EPS Goals

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Cumulative

EPS Goals

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Q3 2002

    

-0.09

    

-0.09

Q4 2002

    

-0.05

    

-0.14

Q1 2003

    

-0.05

    

-0.19

Q2 2003

    

-0.02

    

-0.21

Q3 2003

    

      0

    

-0.21

Q4 2003

    

 0.03

    

-0.18

 

In US Dollars

 

    

First

Installment

Date

Q3 2002

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Second

Installment

Date

Q4 2002

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Third

Installment

Date

Q1 2003

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Fourth

Installment

Date

Q2 2003

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Fifth

Installment

Date

Q3 2003

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Sixth

Installment

Date

Q4 2003

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The “Target EPS Goals”

  

-0.09

  

-0.05

  

-0.05

  

-0.02

  

      0

  

  0.03

The “Cumulative EPS Goals”

  

-0.09

  

-0.14

  

-0.19

  

-0.21

  

-0.21

  

-0.18

 

3.    CERTIFICATES REPRESENTING RESTRICTED STOCK.

 

(a)    Restricted Stock shall not be evidenced by issuance of certificates, and
shall remain in the custody of the Company or its designee until such time as
the Restrictions on such shares have expired. In addition, Restricted Stock
shall be subject to such stop-transfer orders and other restrictive measures as
the Company shall deem advisable under federal or state securities laws, rules
and regulations thereunder, and the rules of any national securities exchange on
which Common Stock is then quoted or listed, or to implement the Restrictions.

 

(b)    Subject to Section 2(e), upon expiration of the Restrictions on any
Restricted Stock, the Company shall promptly be deposited into your account
established with RBC Capital Markets.

 

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4.    STOCK POWERS.  Grantee agrees to execute and deliver to the Company, in
connection herewith, one or more stock powers in the form attached hereto as
EXHIBIT C authorizing the transfer of the Restricted Stock to the Company.

 

5.    TAX MATTERS.

 

(a)    Recognition of Income.  Grantee understands that under Section 83 and
other applicable provisions of the Internal Revenue Code of 1986, as amended
(the “Code”) the fair market value of the Restricted Stock on the date when the
Restrictions expire minus the fair market value of the Restricted Stock (without
regard to the Restrictions) on the Exchange Date will be reportable as ordinary
income at such time. Grantee further understands that, in lieu of the foregoing,
Grantee may elect to be taxed at the time the Restricted Stock is acquired
hereunder on a recognized income amount equal to the fair market value of the
Restricted Stock (without regard to the Restrictions) on the Exchange Date less
Grantee’s basis in the Restricted Stock, which will be the fair market value of
the Restricted Stock (without regard to the Restrictions) on the Exchange Date,
by filing an election with the Internal Revenue Service pursuant to Section
83(b) of the Code within thirty (30) calendar days after Exchange Date (an
“83(b) Election”). Grantee acknowledges that it is Grantee’s sole responsibility
to seek advice regarding Section 83(b) and to determine whether to make an 83(b)
Election.

 

(b)    Tax Withholdings.

 

(i)    If Grantee does not file an 83(b) Election, Grantee is required to pay
the employee portion of any applicable tax withholding and other payroll tax
amounts. Grantee hereby directs the Company to sell on Grantee’s behalf on each
vesting date a number of shares of the Restricted Stock that vests on a vesting
date with a value equal to the amount of the employee tax withholdings and other
payroll taxes for such shares of stock and to use the proceeds from the sale of
such shares of stock to pay for all applicable tax withholdings.

 

(ii)    If Grantee files an 83(b) Election within thirty (30) calendar days of
the Exchange Date, Grantee will be required to tender a check on the Exchange
Date in the amount of the applicable employee tax withholdings and other payroll
taxes, if any, for the grant of the Restricted Stock.

 

6.    GRANTEE BOUND BY PLAN.  Grantee hereby acknowledges receipt of the
attached copy of the Plan and agrees to be bound by all the terms and provisions
thereof (as presently in effect or hereafter amended), which are incorporated
herein by reference, and by all decisions and determinations of the Committee
thereunder. Capitalized terms not otherwise defined herein shall have the
meaning ascribed thereto in the Plan; provided, however, that in the event the
provisions hereof conflict or are inconsistent with the terms of the Plan the
provisions hereof shall govern the Restricted Stock.

 

7.    MISCELLANEOUS.

 

(a)    This Agreement shall be binding upon the heirs, executors, administrators
and successors of the parties. This Agreement constitutes the entire agreement
between the parties with respect to the Restricted Stock, and supersedes any
prior agreements or documents with respect to the Restricted Stock.
Notwithstanding the foregoing, nothing in this Agreement shall affect the
parties’ rights or obligations under any change of control agreement executed
prior to or after the effective date of this Agreement.

 

(b)    This Agreement is not an employment or other services contract and
nothing in this Agreement shall affect in any manner whatsoever the right or
power of the Company (or any subsidiary of the Company) to terminate Grantee’s
employment or services for any reason and at any time, with or without cause,
and with or without notice.

 

(c)    In addition to any other limitation on transfer imposed by applicable
securities laws, Grantee shall not assign, pledge, hypothecate, donate, encumber
or otherwise dispose of any interest in the shares of Restricted Stock while
such shares are subject to the Restrictions set forth in this Agreement. After
the Restrictions

 

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have expired with respect to any such shares of Restricted Stock, the shares
with respect to which the Restrictions have expired may be freely disposed of by
Grantee.

 

(d)    Except as permitted by the Plan, no amendment, alteration, suspension,
discontinuation, or termination of this Agreement which may impose any
additional obligation upon the Company or materially impair the rights of
Grantee with respect to the Restricted Stock shall be valid unless in each
instance such amendment, alteration, suspension, discontinuation, or termination
is expressed in a written instrument duly executed in the name and on behalf of
the Company and by Grantee.

 

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IN WITNESS WHEREOF, this CEO AND CFO RESTRICTED STOCK AGREEMENT is entered into
as of the date first set forth above.

 

CHORDIANT SOFTWARE, INC.

     

GRANTEE

By:

 

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By:

 

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Print Name:

 

Tyler Wall

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Print Name:

 

Steve Vogel

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Print Title:

 

General Counsel

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Print Title:

 

Chief Financial Officer

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