Document:

exv10w1

 

Exhibit 10.1

DEMANDTEC, INC.

INDEMNIFICATION AGREEMENT

     This Indemnification Agreement (“Agreement”) is made as of                     , 2007 by and
between DemandTec, Inc., a Delaware corporation (the “Company”), and                     
(“Indemnitee”).

RECITALS

     WHEREAS, highly competent persons have become more reluctant to serve publicly held
corporations as directors, officers, or in other capacities unless they are provided with adequate
protection through insurance or adequate indemnification against risks of claims and actions
against them arising out of their service to and activities on behalf of the corporation;

     WHEREAS, there has been a substantial increase in corporate litigation, subjecting directors,
officers, employees, agents and fiduciaries to increased risks of claims and actions against them;

     WHEREAS, the Board of Directors of the Company (the “Board”) has determined that the
increased difficulty in attracting and retaining such persons is detrimental to the best interests
of the Company’s stockholders and that the Company should act to assure such persons that there
will be increased certainty of such protection in the future;

     WHEREAS, the Company and Indemnitee recognize the continued difficulty in obtaining liability
insurance for the Company’s directors, officers, employees, agents and fiduciaries, the significant
increases in the cost of such insurance and the general trend of insurance companies to reduce the
scope of coverage of such insurance;

     WHEREAS, the Restated Certificate of Incorporation of the Company (the “Charter”)
authorizes indemnification of the officers, directors of the Company and other persons to the
fullest extent permitted by applicable law, and the Bylaws of the Company (the “Bylaws”)
require indemnification of the officers and directors of the Company to the fullest extent
authorized under the General Corporation Law of the State of Delaware (“DGCL”). Indemnitee
may also be entitled to indemnification pursuant to the DGCL;

     WHEREAS, the Charter, Bylaws and DGCL provide that the indemnification provisions set forth
therein are not exclusive, and thereby contemplate that contracts may be entered into between the
Company and members of the board of directors, officers and other persons with respect to
indemnification;

     WHEREAS, Indemnitee is concerned that the protection available under the Charter, Bylaws and
DGCL and any insurance may not be adequate to protect Indemnitee, and in consideration of serving
as a director, officer or employee (as applicable), desires to be assured of adequate protection,
and the Company desires Indemnitee to serve in such capacity. Indemnitee is willing to serve,
continue to serve and to take on additional service for or on behalf of the Company on the
condition that Indemnitee be so indemnified;

 

 

     WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate
itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent
permitted by applicable law so that they will serve or continue to serve the Company free from
undue concern that they will not be so indemnified; and

     WHEREAS, this Agreement is a supplement to and in furtherance of the indemnification provided
in the Charter and Bylaws and any resolutions adopted pursuant thereto, and shall not be deemed a
substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.

     NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the
Company and Indemnitee do hereby covenant and agree as follows:

     Section 1. Services to the Company. Indemnitee agrees to serve as a director, officer or
employee (as applicable) of the Company. Indemnitee may at any time and for any reason resign from
such position (subject to any other contractual obligation or any obligation imposed by operation
of law), in which event the Company shall have no obligation under this Agreement to continue
Indemnitee in such position. This Agreement shall not be deemed an employment contract between the
Company (or any of its subsidiaries or any Enterprise) and Indemnitee. The foregoing
notwithstanding, this Agreement shall continue in force after Indemnitee’s services to the Company
have ceased.

     Section 2. Definitions. As used in this Agreement:

          (a) “Corporate Status” describes the status of a person who is or was a director,
officer, employee or agent of the Company or of any other corporation, partnership or joint
venture, trust, employee benefit plan or other enterprise which such person is or was serving at
the request of the Company.

          (b) “Enterprise” shall mean the Company and any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at
the request of the Company as a director, officer, employee, agent or fiduciary.

          (c) “Expenses” shall include all reasonable attorneys’ fees, retainers, court costs,
transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and
binding costs, telephone charges, postage, delivery service fees, and all other disbursements or
expenses of the types customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, being or preparing to be a witness in, or otherwise
participating in, a Proceeding. Expenses also shall include Expenses incurred in connection with
any appeal resulting from any Proceeding, including without limitation the premium, security for,
and other costs relating to any cost bond, supersedes bond, or other appeal bond or its equivalent.
Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of
judgments or fines against Indemnitee.

          (d) “Independent Counsel” means a law firm, or a partner (or, if applicable, member)
of such a law firm, that is experienced in matters of corporation law and neither presently is, nor
in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter
material to either such party (other than with respect to matters concerning the Indemnitee under
this Agreement, or of other indemnitees under similar

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indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim
for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall
not include any person who, under the applicable standards of professional conduct then prevailing,
would have a conflict of interest in representing either the Company or Indemnitee in an action to
determine Indemnitee’s rights under this Agreement. The Company agrees to pay the reasonable fees
and expenses of the Independent Counsel referred to above and to fully indemnify such counsel
against any and all Expenses, claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto.

          (e) The term “Proceeding” shall include any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding, whether brought in the right of
the Company or otherwise and whether of a civil, criminal, administrative or investigative nature,
in which Indemnitee was, is or will be involved as a party or otherwise by reason of Indemnitee’s
Corporate Status, by reason of any action taken by him or of any action on his part while acting in
such capacity, or by reason of the fact that he is or was serving at the request of the Company as
a director, officer, employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, in each case whether or not serving in such capacity at
the time any liability or expense is incurred for which indemnification, reimbursement, or
advancement of expenses can be provided under this Agreement; provided, however, that, other than a
Proceeding initiated by Indemnitee to enforce his or her rights under this Agreement, the term
“Proceeding” shall include a Proceeding (or part thereof) initiated by Indemnitee only if such
Proceeding (or part thereof) was authorized by the Board of Directors.

     Section 3. Indemnity in Third-Party Proceedings. The Company shall indemnify Indemnitee in
accordance with the provisions of this Section 3 if Indemnitee is, or is threatened to be made, a
party to or a participant in any Proceeding, other than a Proceeding by or in the right of the
Company to procure a judgment in its favor. Pursuant to this Section 3, Indemnitee shall be
indemnified against all Expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by Indemnitee or on his behalf in connection with such Proceeding or any claim,
issue or matter therein, if Indemnitee acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Company and, in the case of a criminal
proceeding, had no reasonable cause to believe that his conduct was unlawful. Indemnitee shall not
enter into any settlement in connection with a Proceeding without ten (10) days’ prior notice to
the Company.

     Section 4. Indemnity in Proceedings by or in the Right of the Company. The Company shall
indemnify Indemnitee in accordance with the provisions of this Section 4 if Indemnitee is, or is
threatened to be made, a party to or a participant in any Proceeding by or in the right of the
Company to procure a judgment in its favor. Pursuant to this Section 4, Indemnitee shall be
indemnified against all Expenses actually and reasonably incurred by him or on his behalf in
connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best interests of the
Company. No indemnification for Expenses shall be made under this Section 4 in respect of any
claim, issue or matter as to which Indemnitee shall have been finally adjudged by a court to be
liable to the Company, unless and only to the extent that the Delaware Court of Chancery (the

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“Delaware Court”) or any court in which the Proceeding was brought shall determine upon
application that, despite the adjudication of liability but in view of all the circumstances of the
case, Indemnitee is fairly and reasonably entitled to indemnification for such expenses as the
Delaware Court or such other court shall deem proper.

     Section 5. Indemnification for Expenses of a Party Who is Wholly or Partly Successful.
Notwithstanding any other provisions of this Agreement, to the extent that Indemnitee is a party to
or a participant in and is successful, on the merits or otherwise, in any Proceeding or in defense
of any claim, issue or matter therein, in whole or in part, the Company shall indemnify Indemnitee
against all Expenses actually and reasonably incurred by him in connection therewith. If
Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the
Company shall indemnify Indemnitee against (a) all Expenses actually and reasonably incurred by him
or on his behalf in connection with each successfully resolved claim, issue or matter and (b) any
claim, issue or matter related to any such successfully resolved claim, issue or matter. For
purposes of this Section and without limitation, the termination of any claim, issue or matter in
such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful
result as to such claim, issue or matter.

     Section 6. Indemnification For Expenses of a Witness. Notwithstanding any other provision of
this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a witness in
any Proceeding to which Indemnitee is not a party, he shall be indemnified against all Expenses
actually and reasonably incurred by him or on his behalf in connection therewith.

     Section 7. Additional Indemnification.

          (a) Notwithstanding any limitation in Sections 3, 4, or 5, the Company shall indemnify
Indemnitee to the fullest extent permitted by law if Indemnitee is a party to or threatened to be
made a party to any Proceeding (including a Proceeding by or in the right of the Company to procure
a judgment in its favor) against all Expenses, judgments, fines and amounts paid in settlement
actually and reasonably incurred by Indemnitee in connection with the Proceeding.

          (b) For purposes of Section 7(a), the meaning of the phrase “to the fullest extent permitted
by law” shall include, but not be limited to:

                    (i) to the fullest extent permitted by the provision of the DGCL that authorizes or
contemplates additional indemnification by agreement, or the corresponding provision of any
amendment to or replacement of the DGCL or such provision thereof, and

                    (ii) to the fullest extent authorized or permitted by any amendments to or replacements of the
DGCL adopted after the date of this Agreement that increase the extent to which a corporation may
indemnify its officers and directors, employees or agents.

     Section 8. Exclusions. Notwithstanding any provision in this Agreement to the contrary, the
Company shall not be obligated under this Agreement to make any indemnity with respect to any claim
made against Indemnitee:

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          (a) for which payment has actually been made to or on behalf of Indemnitee under any insurance
policy or other indemnity provision, except with respect to any excess beyond the amount paid under
any insurance policy or other indemnity provision.

          (b) for an accounting of profits made from the purchase and sale (or sale and purchase) by
Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act, as
amended, or similar provisions of state statutory law or common law; or

          (c) for which payment is prohibited by applicable law.

     Section 9. Advances of Expenses. The Company shall advance, to the extent not prohibited by law,
the Expenses incurred by Indemnitee in connection with any Proceeding, and such advancement shall
be made within ten (10) days after the receipt by the Company of a statement or statements
requesting such advances (which shall include invoices received by Indemnitee in connection with
such Expenses but, in the case of invoices in connection with legal services, any references to
legal work performed or to expenditures made that would cause Indemnitee to waive any privilege
accorded by applicable law shall not be included with the invoice) from time to time, whether prior
to or after final disposition of any Proceeding. Advances shall be unsecured and interest free.
Advances shall be made without regard to Indemnitee’s ability to repay the expenses and without
regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this
Agreement. Advances shall include any and all reasonable Expenses incurred pursuing an action to
enforce this right of advancement, including Expenses incurred preparing and forwarding statements
to the Company to support the advances claimed. The Indemnitee shall qualify for advances upon the
execution and delivery to the Company of this Agreement which shall constitute an undertaking
providing that the Indemnitee undertakes to the fullest extent required by law to repay the advance
if and to the extent that it is ultimately determined by final judicial decision from which there
is no further right to appeal that Indemnitee is not entitled to be indemnified by the Company.
This Section 9 shall not apply to any claim made by Indemnitee for which indemnity is excluded
pursuant to Section 8. The right to advances under this paragraph shall in all events continue
until final disposition of any Proceeding, including any appeal therefrom.

     Section 10. Procedure for Notification and Defense of Claim.

          (a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a
written request therefor.

          (b) The Company will be entitled to participate in the Proceeding at its own expense.

     Section 11. Procedure Upon Application for Indemnification.

          (a) Upon written request by Indemnitee for indemnification pursuant to Section 10(a), a
determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto
shall be made in the specific case by Independent Counsel chosen in accordance Section 11(b) below
in a written opinion to the Board, a copy of which shall be delivered to Indemnitee, and, if it is
so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made
as soon as practicable, but in no event later than ten (10)

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days, after such determination. Indemnitee shall cooperate with the Independent Counsel
making such determination with respect to Indemnitee’s entitlement to indemnification, including
providing to such counsel upon reasonable advance request any documentation or information which is
not privileged or otherwise protected from disclosure and which is reasonably available to
Indemnitee and reasonably necessary to such determination. Any costs or expenses (including
attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating with the Independent
Counsel shall be borne by the Company (irrespective of the determination as to Indemnitee’s
entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee
harmless therefrom.

          (b) The Independent Counsel shall be selected by Indemnitee. The Company may, within ten (10)
days after written notice of such selection, deliver to the Indemnitee a written objection to such
selection; provided, however, that such objection may be asserted only on the
ground that the Independent Counsel so selected does not meet the requirements of “Independent
Counsel” as defined in Section 2 of this Agreement, and the objection shall set forth with
particularity the factual basis of such assertion. Absent a proper and timely objection, the person
so selected shall act as Independent Counsel. If such written objection is so made and
substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and
until such objection is withdrawn or a court has determined that such objection is without merit.
If, within twenty (20) days after the later of submission by Indemnitee of a written request for
indemnification pursuant to Section 10(a) hereof, and the final disposition of the Proceeding,
including any appeal therein, no Independent Counsel shall have been selected and not objected to,
the Indemnitee may petition a court of competent jurisdiction for resolution of any objection which
shall have been made by the Company to the selection of Independent Counsel and/or for the
appointment as Independent Counsel of a person selected by the court or by such other person as the
court shall designate, and the person with respect to whom all objections are so resolved or the
person so appointed shall act as Independent Counsel under Section 11(a) hereof. Upon the due
commencement of any judicial proceeding or arbitration pursuant to Section 13(a) of this Agreement,
Independent Counsel shall be discharged and relieved of any further responsibility in such capacity
(subject to the applicable standards of professional conduct then prevailing).

     Section 12. Presumptions and Effect of Certain Proceedings.

          (a) In making a determination with respect to entitlement to indemnification hereunder, the
Independent Counsel making such determination shall presume that Indemnitee is entitled to
indemnification under this Agreement if Indemnitee has submitted a request for indemnification in
accordance with Section 10(a) of this Agreement, and the Company shall have the burden of proof to
overcome that presumption in connection with the making by the Independent Counsel of any
determination contrary to that presumption. Neither the failure of the Company or of Independent
Counsel to have made a determination prior to the commencement of any action pursuant to this
Agreement that indemnification is proper in the circumstances because Indemnitee has met the
applicable standard of conduct, nor an actual determination by the Company or by Independent
Counsel that Indemnitee has not met such applicable standard of conduct, shall be a defense to the
action or create a presumption that Indemnitee has not met the applicable standard of conduct.

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          (b) The termination of any Proceeding or of any claim, issue or matter therein, by judgment,
order, settlement or conviction, or upon a plea of guilty or nolo contendere or its
equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself
adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee
did not act in good faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had
reasonable cause to believe that his conduct was unlawful.

          (c) For purposes of any determination of good faith, Indemnitee shall be deemed to have acted
in good faith if Indemnitee’s action is based on the records or books of account of the Enterprise,
including financial statements, or on information supplied to Indemnitee by the officers of the
Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise or
the Board or counsel selected by any committee of the Board or on information or records given or
reports made to the Enterprise by an independent certified public accountant or by an appraiser,
investment banker or other expert selected with reasonable care by the Company or the Board or any
committee of the Board. The provisions of this Section 12(c) shall not be deemed to be exclusive
or to limit in any way the other circumstances in which the Indemnitee may be deemed to have met
the applicable standard of conduct set forth in this Agreement.

          (d) The knowledge and/or actions, or failure to act, of any director, officer, agent or
employee of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right
to indemnification under this Agreement.

     Section 13. Remedies of Indemnitee.

          (a) Subject to Section 13(e), in the event that (i) a determination is made pursuant to
Section 11 of this Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 9 of this Agreement,
(iii) no determination of entitlement to indemnification shall have been made pursuant to Section
11(a) of this Agreement within sixty (60) days after receipt by the Company of the request for
indemnification, (iv) payment of indemnification is not made pursuant to Section 5 or 6 or the last
sentence of Section 11(a) of this Agreement within ten (10) days after receipt by the Company of a
written request therefor, or (v) payment of indemnification pursuant to Section 3, 4 or 7 of this
Agreement is not made within ten (10) days after a determination has been made that Indemnitee is
entitled to indemnification, Indemnitee shall be entitled to an adjudication by a court of his
entitlement to such indemnification or advancement of Expenses. Alternatively, Indemnitee, at his
option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the
Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence
such proceeding seeking an adjudication or an award in arbitration within 180 days following the
date on which Indemnitee first has the right to commence such proceeding pursuant to this Section
13(a); provided, however, that the foregoing clause shall not apply in respect of a
proceeding brought by Indemnitee to enforce his rights under Section 5 of this Agreement. The
Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

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          (b) In the event that a determination shall have been made pursuant to Section 11(a) of this
Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or
arbitration commenced pursuant to this Section 13 shall be conducted in all respects as a de novo
trial, or arbitration, on the merits and Indemnitee shall not be prejudiced by reason of that
adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section
13 the Company shall have the burden of proving Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be.

          (c) If a determination shall have been made pursuant to Section 11(a) of this Agreement that
Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any
judicial proceeding or arbitration commenced pursuant to this Section 13, absent (i) a misstatement
by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for indemnification, or (ii) a
prohibition of such indemnification under applicable law.

          (d) The Company shall be precluded from asserting in any judicial proceeding or arbitration
commenced pursuant to this Section 13 that the procedures and presumptions of this Agreement are
not valid, binding and enforceable and shall stipulate in any such court or before any such
arbitrator that the Company is bound by all the provisions of this Agreement. The Company shall
indemnify Indemnitee against any and all Expenses and, if requested by Indemnitee, shall (within
ten (10) days after receipt by the Company of a written request therefor) advance, to the extent
not prohibited by law, such Expenses to Indemnitee, which are incurred by Indemnitee in connection
with any action brought by Indemnitee for indemnification or advance of Expenses from the Company
under this Agreement or under any directors’ and officers’ liability insurance policies maintained
by the Company, regardless of whether Indemnitee ultimately is determined to be entitled to such
indemnification, advancement of Expenses or insurance recovery, as the case may be, in the suit for
which indemnification or advances is being sought.

          (e) Notwithstanding anything in this Agreement to the contrary, no determination as to
entitlement to indemnification under this Agreement shall be required to be made prior to the final
disposition of the Proceeding, including any appeal therein.

     Section 14. Non-exclusivity; Survival of Rights; Insurance; Subrogation.

          (a) The rights of indemnification and to receive advancement of Expenses as provided by this
Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable law, the Charter, the Company’s Bylaws, any agreement, a vote of
stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal of this
Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this
Agreement in respect of any action taken or omitted by such Indemnitee in his Corporate Status
prior to such amendment, alteration or repeal. To the extent that a change in Delaware law, whether
by statute or judicial decision, permits greater indemnification or advancement of Expenses than
would be afforded currently under the Charter, Bylaws and this Agreement, it is the intent of the
parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by
such change. No right or remedy herein conferred is intended to be exclusive of any other right or
remedy, and every other right and

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remedy shall be cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment
of any other right or remedy.

          (b) To the extent that the Company maintains an insurance policy or policies providing
liability insurance for directors, officers, employees, or agents of the Company or of any other
Enterprise, Indemnitee shall be covered by such policy or policies in accordance with its or their
terms to the maximum extent of the coverage available for any such director, officer, employee or
agent under such policy or policies. If, at the time of the receipt of a notice of a claim pursuant
to the terms hereof, the Company has director and officer liability insurance in effect, the
Company shall give prompt notice of the commencement of such proceeding to the insurers in
accordance with the procedures set forth in the respective policies. The Company shall thereafter
take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee,
all amounts payable as a result of such proceeding in accordance with the terms of such policies.

          (c) In the event of any payment under this Agreement, the Company shall be subrogated to the
extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers
required and take all action necessary to secure such rights, including execution of such documents
as are necessary to enable the Company to bring suit to enforce such rights.

          (d) The Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable (or for which advancement is provided hereunder) hereunder if and to the
extent that Indemnitee has otherwise actually received such payment under any insurance policy,
contract, agreement or otherwise.

          (e) The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee who is
or was serving at the request of the Company as a director, officer, employee or agent of any other
corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall be
reduced by any amount Indemnitee has actually received as indemnification or advancement of
Expenses from such other corporation, partnership, joint venture, trust, employee benefit plan or
other enterprise.

     Section 15. Duration of Agreement. This Agreement shall continue until and terminate upon the
later of: (a) ten (10) years after the date that Indemnitee shall have ceased to serve as a
director, officer or employee (as applicable) of the Company or (b) one (1) year after the final
termination of any Proceeding, including any appeal, then pending in respect of which Indemnitee is
granted rights of indemnification or advancement of Expenses hereunder and of any proceeding
commenced by Indemnitee pursuant to Section 13 of this Agreement relating thereto. This Agreement
shall be binding upon the Company and its successors and assigns and shall inure to the benefit of
Indemnitee and his spouse, heirs, executors, administrators, and personal or legal representatives.
The Company shall require and cause any successor (whether direct or indirect by purchase, merger,
consolidation or otherwise) to all, substantially all or a substantial part of the business and/or
assets of the Company, by written agreement in form and substance satisfactory to the Indemnitee,
expressly to assume and agree to perform this

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Agreement in the same manner and to the same extent that the Company would be required to
perform if no such succession had taken place.

     Section 16. Severability. If any provision or provisions of this Agreement shall be held to be
invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including without limitation, each
portion of any Section of this Agreement containing any such provision held to be invalid, illegal
or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be
affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law;
(b) such provision or provisions shall be deemed reformed to the extent necessary to conform to
applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the
fullest extent possible, the provisions of this Agreement (including, without limitation, each
portion of any Section of this Agreement containing any such provision held to be invalid, illegal
or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to
give effect to the intent manifested thereby.

     Section 17. Enforcement.

          (a) The Company expressly confirms and agrees that it has entered into this Agreement and
assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director,
officer or employee (as applicable) of the Company, and the Company acknowledges that Indemnitee is
relying upon this Agreement in serving as a director, officer or employee (as applicable) of the
Company.

          (b) This Agreement constitutes the entire agreement between the parties hereto with respect to
the subject matter hereof and supersedes all prior agreements and understandings, oral, written and
implied, between the parties hereto with respect to the subject matter hereof; provided,
however, that this Agreement is a supplement to and in furtherance of the Charter of the
Company, the Bylaws of the Company and applicable law, and shall not be deemed a substitute
therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.

     Section 18. Modification and Waiver. No supplement, modification or amendment of this Agreement
shall be binding unless executed in writing by the parties thereto. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions
of this Agreement nor shall any waiver constitute a continuing waiver.

     Section 19. Notice by Indemnitee. Indemnitee agrees promptly to notify the Company in writing
upon being served with any summons, citation, subpoena, complaint, indictment, information or other
document relating to any Proceeding or matter which may be subject to indemnification or
advancement of Expenses covered hereunder. The failure of Indemnitee to so notify the Company shall
not relieve the Company of any obligation which it may have to the Indemnitee under this Agreement
or otherwise.

     Section 20. Notices. All notices, requests, demands and other communications under this Agreement
shall be in writing and shall be deemed to have been duly given if (a) delivered by hand and
receipted for by the party to whom said notice or other communication shall have been directed, (b)
mailed by certified or registered mail with postage prepaid, on the third

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business day after the date on which it is so mailed, (c) mailed by reputable overnight
courier and receipted for by the party to whom said notice or other communication shall have been
directed or (d) sent by facsimile transmission, with receipt of oral confirmation that such
transmission has been received:

          (a) If to Indemnitee, at such address as Indemnitee shall provide to the Company.

          (b) If to the Company to:

DemandTec, Inc.

One Circle Star Way, Suite 200

San Carlos, CA 94070

Attention: Chief Executive Officer

or to any other address as may have been furnished to Indemnitee by the Company.

     Section 21. Contribution. To the fullest extent permissible under applicable law, if the
indemnification provided for in this Agreement is unavailable to Indemnitee for any reason
whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount
incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to
be paid in settlement and/or for Expenses, in connection with any claim relating to an
indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in
light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits
received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving
cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors,
officers, employees and agents) and Indemnitee in connection with such event(s) and/or
transaction(s).

     Section 22. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations
among the parties shall be governed by, and construed and enforced in accordance with, the laws of
the State of Delaware, without regard to its conflict of laws rules. Except with respect to any
arbitration commenced by Indemnitee pursuant to Section 13(a) of this Agreement, the Company and
Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising
out of or in connection with this Agreement shall be brought only in the Delaware Court, and not in
any other state or federal court in the United States of America or any court in any other country,
(ii) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any
action or proceeding arising out of or in connection with this Agreement, (iii) appoint, to the
extent such party is not otherwise subject to service of process in the State of Delaware,
Incorporating Services, Ltd., Dover, Delaware as its agent in the State of Delaware as such party’s
agent for acceptance of legal process in connection with any such action or proceeding against such
party with the same legal force and validity as if served upon such party personally within the
State of Delaware, (iv) waive any objection to the laying of venue of any such action or proceeding
in the Delaware Court, and (v) waive, and agree not to plead or to make, any claim that any such
action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient
forum.

     Section 23. Identical Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall for all purposes be deemed to be an original but all of which together shall
constitute one and the same Agreement. Only one such counterpart signed by the party against whom
enforceability is sought needs to be produced to evidence the existence of this Agreement.

     Section 24. Miscellaneous. The headings of the paragraphs of this Agreement are inserted for
convenience only and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.

11

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year
first above written.

	 	 	 	 	 
	 	 	DEMANDTEC, INC.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:
	 
	 	 	 	 
	 	 	INDEMNITEE:
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:

12exv10w3

 

Exhibit 10.3

DemandTec, Inc.

2007 Equity Incentive Plan

(As
Adopted Effective                , 2007)

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE 1. INTRODUCTION
	 	 	1	 
	 
	 	 	 	 
	ARTICLE 2. ADMINISTRATION
	 	 	1	 
	2.1 Committee Composition
	 	 	1	 
	2.2 Committee Responsibilities
	 	 	1	 
	2.3 Non-Officer Grants
	 	 	2	 
	 
	 	 	 	 
	ARTICLE 3. SHARES AVAILABLE FOR GRANTS
	 	 	2	 
	3.1 Basic Limitation
	 	 	2	 
	3.2 Annual Increase in Shares
	 	 	2	 
	3.3 Shares Returned to Reserve
	 	 	2	 
	3.4 Dividend Equivalents
	 	 	2	 
	 
	 	 	 	 
	ARTICLE 4. ELIGIBILITY
	 	 	3	 
	4.1 Incentive Stock Options
	 	 	3	 
	4.2 Other Grants
	 	 	3	 
	 
	 	 	 	 
	ARTICLE 5. OPTIONS
	 	 	3	 
	5.1 Stock Option Agreement
	 	 	3	 
	5.2 Number of Shares
	 	 	3	 
	5.3 Exercise Price
	 	 	3	 
	5.4 Exercisability and Term
	 	 	3	 
	5.5 Effect of Change in Control
	 	 	3	 
	5.6 Modification or Assumption of Options
	 	 	4	 
	5.7 Buyout Provisions
	 	 	4	 
	 
	 	 	 	 
	ARTICLE 6. PAYMENT FOR OPTION SHARES
	 	 	4	 
	6.1 General Rule
	 	 	4	 
	6.2 Surrender of Stock
	 	 	4	 
	6.3 Exercise/Sale
	 	 	4	 
	6.4 Promissory Note
	 	 	4	 
	6.5 Other Forms of Payment
	 	 	4	 
	 
	 	 	 	 
	ARTICLE 7. STOCK APPRECIATION RIGHTS
	 	 	5	 
	7.1 SAR Agreement
	 	 	5	 
	7.2 Number of Shares
	 	 	5	 
	7.3 Exercise Price
	 	 	5	 
	7.4 Exercisability and Term
	 	 	5	 
	7.5 Effect of Change in Control
	 	 	5	 
	7.6 Exercise of SARs
	 	 	5	 
	7.7 Modification or Assumption of SARs
	 	 	6	 
	 
	 	 	 	 
	ARTICLE 8. RESTRICTED SHARES
	 	 	6	 
	8.1 Restricted Stock Agreement
	 	 	6	 

i

 

	 	 	 	 	 
	 	 	Page	 
	8.2 Payment for Awards
	 	 	6	 
	8.3 Vesting Conditions
	 	 	6	 
	8.4 Voting and Dividend Rights
	 	 	7	 
	 
	 	 	 	 
	ARTICLE 9. STOCK UNITS
	 	 	7	 
	9.1 Stock Unit Agreement
	 	 	7	 
	9.2 Payment for Awards
	 	 	7	 
	9.3 Vesting Conditions
	 	 	7	 
	9.4 Voting and Dividend Rights
	 	 	7	 
	9.5 Form and Time of Settlement of Stock Units
	 	 	8	 
	9.6 Death of Recipient
	 	 	8	 
	9.7 Creditors’ Rights
	 	 	8	 
	 
	 	 	 	 
	ARTICLE 10. PROTECTION AGAINST DILUTION
	 	 	8	 
	10.1 Adjustments
	 	 	8	 
	10.2 Dissolution or Liquidation
	 	 	9	 
	10.3 Reorganizations
	 	 	9	 
	 
	 	 	 	 
	ARTICLE 11. AWARDS UNDER OTHER PLANS
	 	 	10	 
	 
	 	 	 	 
	ARTICLE 12. PAYMENT OF DIRECTOR’S FEES IN SECURITIES
	 	 	10	 
	12.1 Effective Date
	 	 	10	 
	12.2 Elections to Receive NSOs, Restricted Shares or Stock Units
	 	 	11	 
	12.3 Number and Terms of NSOs, Restricted Shares or Stock Units
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 13. LIMITATION ON RIGHTS
	 	 	11	 
	13.1 Retention Rights
	 	 	11	 
	13.2 Stockholders’ Rights
	 	 	11	 
	13.3 Regulatory Requirements
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 14. WITHHOLDING TAXES
	 	 	11	 
	14.1 General
	 	 	11	 
	14.2 Share Withholding
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 15. FUTURE OF THE PLAN
	 	 	12	 
	15.1 Term of the Plan
	 	 	12	 
	15.2 Amendment or Termination
	 	 	12	 
	15.3 Stockholder Approval
	 	 	12	 
	 
	 	 	 	 
	ARTICLE 16. DEFINITIONS
	 	 	12	 
	 
	 	 	 	 
	ARTICLE 17. EXECUTION
	 	 	15	 

ii

 

DemandTec, Inc.

2007 Equity Incentive Plan

     ARTICLE 1. INTRODUCTION.

          The Board adopted the Plan effective as of the IPO Date. The purpose of the Plan is to
promote the long-term success of the Company and the creation of stockholder value by (a)
encouraging Employees, Outside Directors and Consultants to focus on critical long-range
objectives, (b) encouraging the attraction and retention of Employees, Outside Directors and
Consultants with exceptional qualifications and (c) linking Employees, Outside Directors and
Consultants directly to stockholder interests through increased stock ownership. The Plan seeks to
achieve this purpose by providing for Awards in the form of Restricted Shares, Stock Units, Options
(which may constitute ISOs or NSOs) or stock appreciation rights.

          The Plan shall be governed by, and construed in accordance with, the laws of the State of
Delaware (except their choice-of-law provisions).

     ARTICLE 2. ADMINISTRATION.

          2.1 Committee Composition. The Compensation Committee of the Board shall administer the Plan.
The Committee shall consist exclusively of two or more members of the Board, who shall be
appointed by the Board. In addition, each member of the Committee shall meet the following
requirements:

          (a) Any listing standards prescribed by the principal securities market on
which the Company’s equity securities are traded;

          (b) Such requirements as the Internal Revenue Service may establish for outside
directors acting under plans intended to qualify for exemption under section
162(m)(4)(C) of the Code;

          (c) Such requirements as the Securities and Exchange Commission may establish
for administrators acting under plans intended to qualify for exemption under Rule
16b-3 (or its successor) under the Exchange Act; and

          (d) Any other requirements imposed by applicable law, regulations or rules.

          2.2 Committee Responsibilities. The Committee shall (a) select the Employees, Outside
Directors and Consultants who are to receive Awards under the Plan, (b) determine the type, number,
vesting requirements and other features and conditions of such Awards, (c) interpret the Plan, (d)
make all other decisions relating to the operation of the Plan and (e) carry out any other duties
delegated to it by the Board under the Plan. The Committee

 

 

may adopt such rules or guidelines as
it deems appropriate to implement the Plan. The Committee’s determinations under the Plan shall be
final and binding on all persons.

          2.3 Non-Officer Grants. The Board may also appoint a single director or an additional
committee of the Board composed of two or more directors of the Company. The single director or
the members of the additional committee need not satisfy the requirements of Section 2.1. Such
director or committee may (a) administer the Plan with respect to Employees and Consultants who are
not Outside Directors and are not considered executive officers of the Company under section 16 of
the Exchange Act, (b) grant Awards under the Plan to such Employees and Consultants and (c)
determine all features and conditions of such Awards. Within the limitations of this Section 2.3,
any reference in the Plan to the Committee shall include a single director or an additional
committee to whom the Board has delegated the required authority under this Section 2.3.

     ARTICLE 3. SHARES AVAILABLE FOR GRANTS.

          3.1 Basic Limitation. Common Shares issued pursuant to the Plan may be authorized but
unissued shares or treasury shares. The aggregate number of Common Shares issued under the Plan
shall not exceed (a) 6,000,000 plus (b) the additional Common Shares described in Sections 3.2 and
3.3. The number of Common Shares that are subject to Awards outstanding at any time under the Plan
shall not exceed the number of Common Shares that then remain available for issuance under the
Plan. All Common Shares available under the Plan may be issued upon the exercise of ISOs. The
limitations of this Section 3.1 and Section 3.2 shall be subject to adjustment pursuant to Article
10.

          3.2 Annual Increase in Shares. As of the first day of each fiscal year of the Company,
commencing with fiscal year 2009, the aggregate number of Common Shares that may be issued under
the Plan shall automatically increase by a number equal to the lowest of (a) 5% of the total number
of Common Shares then outstanding, (b) 7,500,000 Common Shares or (c) the number determined by the
Board.

          3.3 Shares Returned to Reserve. If Options, SARs or Stock Units are forfeited or terminate for any other reason before
being exercised or settled, then the Common Shares subject to such Options, SARs or Stock Units
shall again become available for issuance under the Plan. If SARs are exercised, then only the
number of Common Shares (if any) actually issued in settlement of such SARs shall reduce the number
available under Section 3.1 and the balance shall again become available for issuance under the
Plan. If Stock Units are settled, then only the number of Common Shares (if any) actually issued
in settlement of such Stock Units shall reduce the number available under Section 3.1 and the
balance shall again become available for issuance under the Plan. If Restricted Shares or Common
Shares issued upon the exercise of Options are reacquired by the Company pursuant to a forfeiture
provision or for any other reason, then such Common Shares shall again become available for
issuance under the Plan.

          3.4 Dividend Equivalents. Any dividend equivalents paid or credited under the Plan shall not
be applied against the number of Common Shares that may be issued under the Plan, whether or not
such dividend equivalents are converted into Stock Units.

2

 

     ARTICLE 4. ELIGIBILITY.

          4.1 Incentive Stock Options. Only Employees who are common-law employees of the Company, a
Parent or a Subsidiary shall be eligible for the grant of ISOs. In addition, an Employee who owns
more than 10% of the total combined voting power of all classes of outstanding stock of the Company
or any of its Parents or Subsidiaries shall not be eligible for the grant of an ISO unless the
additional requirements set forth in section 422(c)(5) of the Code are satisfied.

          4.2 Other Grants. Only Employees, Outside Directors and Consultants shall be eligible for the
grant of Restricted Shares, Stock Units, NSOs or SARs.

     ARTICLE 5. OPTIONS.

          5.1 Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a
Stock Option Agreement between the Optionee and the Company. Such Option shall be subject to all
applicable terms of the Plan and may be subject to any other terms that are not inconsistent with
the Plan. The Stock Option Agreement shall specify whether the Option is an ISO or an NSO. The
provisions of the various Stock Option Agreements entered into under the Plan need not be
identical. Options may be granted in consideration of a reduction in the Optionee’s other
compensation.

          5.2 Number of Shares. Each Stock Option Agreement shall specify the number of Common Shares
subject to the Option and shall provide for the adjustment of such number in accordance with
Article 10. Options granted to an Optionee in any Limitation Period shall not cover more than
2,000,000 Common Shares, except that Options granted to a new Employee in the Limitation Period in
which his or her Service as an Employee commences shall not cover more than 4,000,000 Common
Shares. The limitations set forth in the preceding sentence shall be subject to adjustment in
accordance with Article 10.

          5.3 Exercise Price. Each Stock Option Agreement shall specify the Exercise Price, which shall
not be less than 100% of the Fair Market Value of a Common Share on the date of grant. The
preceding sentence shall not apply to Options granted pursuant to an assumption of, or substitution
for, another option in a manner that would satisfy the requirements of section 424(a) of the Code,
whether or not such section is applicable.

          5.4 Exercisability and Term. Each Stock Option Agreement shall specify the date or event when
all or any installment of the Option is to become exercisable. The Stock Option Agreement shall
also specify the term of the Option; provided that the term shall in no event exceed 10 years from
the date of grant. A Stock Option Agreement may provide for accelerated exercisability in the
event of the Optionee’s death, disability or retirement or other events and may provide for
expiration prior to the end of its term in the event of the termination of the Optionee’s Service.
Options may be awarded in combination with SARs, and such an Award may provide that the Options
will not be exercisable unless the related SARs are forfeited.

          5.5 Effect of Change in Control. The Committee may determine, at the time of granting an
Option or thereafter, that such Option shall become exercisable as to all or part of

3

 

the Common
Shares subject to such Option in the event that a Change in Control occurs with respect to the
Company or in the event that the Optionee is subject to an involuntary termination (as defined in
the applicable Stock Option Agreement) after a Change in Control. However, in the case of an ISO,
the acceleration of exercisability shall not occur without the Optionee’s written consent. In
addition, acceleration of exercisability may be required under Section 10.3.

          5.6 Modification or Assumption of Options. Within the limitations of the Plan, the Committee
may modify, reprice, extend or assume outstanding options or may accept the cancellation of
outstanding options (whether granted by the Company or by another issuer) in return for the grant
of new options for the same or a different number of shares and at the same or a different exercise
price. The foregoing notwithstanding, no modification of an Option shall, without the consent of
the Optionee, alter or impair his or her rights or obligations under such Option.

          5.7 Buyout Provisions. The Committee may at any time (a) offer to buy out for a payment in
cash or cash equivalents an Option previously granted or (b) authorize an Optionee to elect to cash
out an Option previously granted, in either case at such time and based upon such terms and
conditions as the Committee shall establish.

     ARTICLE 6. PAYMENT FOR OPTION SHARES.

          6.1 General Rule. The entire Exercise Price of Common Shares issued upon exercise of Options
shall be payable in cash or cash equivalents at the time when such Common Shares are purchased,
except that the Committee at its sole discretion may accept payment of the Exercise Price in any
other form(s) described in this Article 6. However, if the Optionee is an Outside Director or
executive officer of the Company, he or she may pay the Exercise Price in a form other than cash or
cash equivalents only to the extent permitted by section 13(k) of the Exchange Act.

          6.2 Surrender of Stock. With the Committee’s consent, all or any part of the Exercise Price
may be paid by surrendering, or attesting to the ownership of, Common Shares that are already owned
by the Optionee. Such Common Shares shall be valued at their Fair Market Value on the date when
the new Common Shares are purchased under the Plan.

          6.3 Exercise/Sale. With the Committee’s consent, all or any part of the Exercise Price and
any withholding taxes may be paid by delivering (on a form prescribed by the Company) an
irrevocable direction to a securities broker approved by the Company to sell all or part of the
Common Shares being purchased under the Plan and to deliver all or part of the sales proceeds to
the Company.

          6.4 Promissory Note. With the Committee’s consent, all or any part of the Exercise Price and
any withholding taxes may be paid by delivering (on a form prescribed by the Company) a
full-recourse promissory note.

          6.5 Other Forms of Payment. With the Committee’s consent, all or any part of the Exercise
Price and any withholding taxes may be paid in any other form that is consistent with applicable
laws, regulations and rules.

4

 

     ARTICLE 7. STOCK APPRECIATION RIGHTS.

          7.1 SAR Agreement. Each grant of an SAR under the Plan shall be evidenced by an SAR Agreement
between the Optionee and the Company. Such SAR shall be subject to all applicable terms of the
Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions
of the various SAR Agreements entered into under the Plan need not be identical. SARs may be
granted in consideration of a reduction in the Optionee’s other compensation.

          7.2 Number of Shares. Each SAR Agreement shall specify the number of Common Shares to which
the SAR pertains and shall provide for the adjustment of such number in accordance with Article 10.
SARs granted to an Optionee in any Limitation Period shall in no event pertain to more than
2,000,000 Common Shares, except that SARs granted to a new Employee in the Limitation Period in
which his or her Service as an Employee commences shall not pertain to more than 4,000,000 Common
Shares. The limitations set forth in the preceding sentence shall be subject to adjustment in
accordance with Article 10.

          7.3 Exercise Price. Each SAR Agreement shall specify the Exercise Price, which shall in no
event be less than 100% of the Fair Market Value of a Common Share on the date of grant. The
preceding sentence shall not apply to SARs granted pursuant to an assumption of, or substitution
for, another SAR in a manner that would satisfy the requirements of section 424(a) of the Code if
such section were applicable.

          7.4 Exercisability and Term. Each SAR Agreement shall specify the date when all or any
installment of the SAR is to become exercisable. The SAR Agreement shall also specify the term of
the SAR; provided that the term shall in no event exceed 10 years from the date of grant. An SAR
Agreement may provide for accelerated exercisability in the event of the Optionee’s death,
disability or retirement or other events and may provide for expiration prior to the end of its
term in the event of the termination of the Optionee’s Service. SARs may be awarded in combination
with Options, and such an Award may provide that the SARs will not be exercisable unless the
related Options are forfeited. An SAR may be included in an ISO only at the time of grant but may
be included in an NSO at the time of grant or thereafter. An SAR granted under the Plan may
provide that it will be exercisable only in the event of a Change in Control.

          7.5 Effect of Change in Control. The Committee may determine, at the time of granting an SAR
or thereafter, that such SAR shall become exercisable as to all or part of the Common Shares
subject to such SAR in the event that the Company is subject to a Change in Control or in the event
that the
Optionee is subject to an involuntary termination (as defined in the applicable SAR Agreement)
after a Change in Control. In addition, acceleration of exercisability may be required under
Section 10.3.

          7.6 Exercise of SARs. Upon exercise of an SAR, the Optionee (or any person having the right
to exercise the SAR after his or her death) shall receive from the Company (a) Common Shares, (b)
cash or (c) a combination of Common Shares and cash, as the Committee shall determine. The amount
of cash and/or the Fair Market Value of Common Shares received upon exercise of SARs shall, in the
aggregate, be equal to the amount by which

5

 

the Fair Market Value (on the date of surrender) of the
Common Shares subject to the SARs exceeds the Exercise Price. If, on the date when an SAR expires,
the Exercise Price is less than the Fair Market Value on such date but any portion of such SAR has
not been exercised or surrendered, then such SAR shall automatically be deemed to be exercised as
of such date with respect to such portion. An SAR Agreement may also provide for an automatic
exercise of the SAR on an earlier date.

          7.7 Modification or Assumption of SARs. Within the limitations of the Plan, the Committee may
modify, reprice, extend or assume outstanding SARs or may accept the cancellation of outstanding
SARs (whether granted by the Company or by another issuer) in return for the grant of new SARs for
the same or a different number of shares and at the same or a different exercise price. The
foregoing notwithstanding, no modification of an SAR shall, without the consent of the Optionee,
alter or impair his or her rights or obligations under such SAR.

     ARTICLE 8. RESTRICTED SHARES.

          8.1 Restricted Stock Agreement. Each grant of Restricted Shares under the Plan shall be
evidenced by a Restricted Stock Agreement between the recipient and the Company. Such Restricted
Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms
that are not inconsistent with the Plan. The provisions of the various Restricted Stock Agreements
entered into under the Plan need not be identical.

          8.2 Payment for Awards. Restricted Shares may be sold or awarded under the Plan for such
consideration as the Committee may determine, including (without limitation) cash, cash
equivalents, property, full-recourse promissory notes, past services and future services. If the
Participant is an Outside Director or executive officer of the Company, he or she may pay for
Restricted Shares with a promissory note only to the extent permitted by section 13(k) of the
Exchange Act. Within the limitations of the Plan, the Committee may accept the cancellation of
outstanding options in return for the grant of Restricted Shares.

          8.3 Vesting Conditions. Each Award of Restricted Shares may or may not be subject to vesting.
Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in
the Restricted Stock Agreement. The Committee may include among such conditions the requirement
that the performance of the Company or a business unit of the Company for a specified period of one
or more fiscal years equal or exceed a target determined in advance by the Committee. The
Committee shall determine such performance. Such target shall be based on one or more of the
criteria set forth in Appendix A. The Committee shall identify such target not later than the
90th day of such period. In no event shall more than 2,000,000 Restricted Shares that
are subject to performance-based vesting conditions be granted to a Participant in any Limitation
Period, except that up to 4,000,000 Restricted Shares subject to performance-based vesting
conditions may be granted to a new Employee in the Limitation Period in which his or her Service as
an Employee commences. The limitations set forth in the preceding sentence shall be subject to
adjustment in accordance with Article 10. A Restricted Stock Agreement may provide for accelerated
vesting in the event of the Participant’s death, disability or retirement or other events. The
Committee may determine, at the time of granting Restricted Shares or thereafter, that all or part
of such Restricted Shares shall become vested in

6

 

the event that a Change in Control occurs with
respect to the Company or in the event that the Participant is subject to an involuntary
termination (as defined in the applicable Restricted Stock Agreement) after a Change in Control.

          8.4 Voting and Dividend Rights. The holders of Restricted Shares awarded under the Plan shall
have the same voting, dividend and other rights as the Company’s other stockholders. A Restricted
Stock Agreement, however, may require that any cash dividends paid on Restricted Shares (a) be
accumulated and paid when such Restricted Shares vest or (b) be invested in additional Restricted
Shares. Such additional Restricted Shares shall be subject to the same conditions and restrictions
as the Award with respect to which the dividends were paid.

     ARTICLE 9. STOCK UNITS.

          9.1 Stock Unit Agreement. Each grant of Stock Units under the Plan shall be evidenced by a
Stock Unit Agreement between the recipient and the Company. Such Stock Units shall be subject to
all applicable terms of the Plan and may be subject to any other terms that are not inconsistent
with the Plan. The provisions of the various Stock Unit Agreements entered into under the Plan
need not be identical. Stock Units may be granted in consideration of a reduction in the
recipient’s other compensation.

          9.2 Payment for Awards. To the extent that an Award is granted in the form of Stock Units, no
cash consideration shall be required of the Award recipients.

          9.3 Vesting Conditions. Each Award of Stock Units may or may not be subject to vesting.
Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in
the Stock Unit Agreement. The Committee may include among such conditions the requirement that the
performance of the Company or a business unit of the Company for a specified period of one or more
fiscal years equal or exceed a target determined in advance by the Committee. The Committee shall
determine such performance. Such target shall be based on one or more of the criteria set forth in
Appendix A. The Committee shall identify such target not later than the 90th day of
such period. In no event shall more than 2,000,000 Stock Units that are subject to
performance-based vesting conditions be granted to a Participant in any Limitation Period, except
that up to 4,000,000 Stock Units subject to performance-based vesting conditions may be granted to
a new Employee in the Limitation Period in which his or her Service as an Employee commences. The
limitations set forth in the preceding sentence shall be subject to adjustment in accordance with
Article 10. A Stock Unit Agreement may provide for accelerated vesting in the event of the
Participant’s death, disability or retirement or other events. The Committee may determine, at the
time of granting Stock Units or thereafter, that all or part of such Stock Units shall become
vested in the event that the Company is subject to a Change in Control or in the event that the
Participant is subject to an involuntary termination (as defined in the applicable Stock Unit
Agreement) after a Change in Control. In addition, acceleration of vesting may be required under
Section 10.3.

          9.4 Voting and Dividend Rights. The holders of Stock Units shall have no voting rights.
Prior to settlement or forfeiture, any Stock Unit awarded under the Plan may, at the Committee’s
discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be
credited with an amount equal to all cash dividends paid on one Common Share

7

 

while the Stock Unit
is outstanding. Dividend equivalents may be converted into additional Stock Units. Settlement of
dividend equivalents may be made in the form of cash, in the form of Common Shares, or in a
combination of both. Prior to distribution, any dividend equivalents that are not paid shall be
subject to the same conditions and restrictions as the Stock Units to which they attach.

          9.5 Form and Time of Settlement of Stock Units. Settlement of vested Stock Units may be made
in the form of (a) cash, (b) Common Shares or (c) any combination of both, as determined by the
Committee. The actual number of Stock Units eligible for settlement may be larger or smaller than
the number included in the original Award, based on predetermined performance factors. Methods of
converting Stock Units into cash may include (without limitation) a method based on the average
Fair Market Value of Common Shares over a series of trading days. Vested Stock Units may be
settled in a lump sum or in installments. The distribution may occur or commence when all vesting
conditions applicable to the Stock Units have been satisfied or have lapsed, or it may be deferred
to any later date. The amount of a deferred distribution may be increased by an interest factor or
by dividend equivalents. Until an Award of Stock Units is settled, the number of such Stock Units
shall be subject to adjustment pursuant to Article 10.

          9.6 Death of Recipient. Any Stock Units Award that becomes payable after the recipient’s
death shall be distributed to the recipient’s beneficiary or beneficiaries. Each recipient of a
Stock Units Award under the Plan shall designate one or more beneficiaries for this purpose by
filing the prescribed form with the Company. A beneficiary designation may be changed by filing
the prescribed form with the Company at any time before the Award recipient’s death. If no
beneficiary was designated or if no designated beneficiary survives the Award recipient, then any
Stock Units Award that becomes payable after the recipient’s death shall be distributed to the
recipient’s estate.

          9.7 Creditors’ Rights. A holder of Stock Units shall have no rights other than those of a
general creditor of the Company. Stock Units represent an unfunded and unsecured obligation of the
Company, subject to the terms and conditions of the applicable Stock Unit Agreement.

     ARTICLE 10. PROTECTION AGAINST DILUTION.

          10.1 Adjustments. In the event of a subdivision of the outstanding Common Shares, a
declaration of a dividend payable in Common Shares or a combination or consolidation of the
outstanding Common Shares (by reclassification or otherwise) into a lesser number of Common Shares,
corresponding adjustments shall automatically be made in each of the following:

          (a) The number of Options, SARs, Restricted Shares and Stock Units available
for future Awards under Article 3;

          (b) The limitations set forth in Sections 5.2, 7.2, 8.3 and 9.3;

          (c) The number of Common Shares covered by each outstanding Option and SAR;

8

 

          (d) The Exercise Price under each outstanding Option and SAR; or

          (e) The number of Stock Units included in any prior Award that has not yet been
settled.

In the event of a declaration of an extraordinary dividend payable in a form other than Common
Shares in an amount that has a material effect on the price of Common Shares, a recapitalization, a
spin-off or a similar occurrence, the Committee shall make such adjustments as it, in its sole
discretion, deems appropriate in one or more of the foregoing. Except as provided in this Article
10, a Participant shall have no rights by reason of any issuance by the Company of stock of any
class or securities convertible into stock of any class, any subdivision or consolidation of
shares of stock of any class, the payment of any stock dividend or any other increase or decrease
in the number of shares of stock of any class.

          10.2 Dissolution or Liquidation. To the extent not previously exercised or settled, Options,
SARs and Stock Units shall terminate immediately prior to the dissolution or liquidation of the
Company.

          10.3 Reorganizations. In the event that the Company is a party to a merger or consolidation,
all outstanding Awards shall be subject to the agreement of merger or consolidation. Such
agreement shall provide for one or more of the following:

          (a) The continuation of such outstanding Awards by the Company (if the Company
is the surviving corporation).

          (b) The assumption of such outstanding Awards by the surviving corporation or
its parent, provided that the assumption of Options or SARs shall comply with
section 424(a) of the Code (whether or not the Options are ISOs).

          (c) The substitution by the surviving corporation or its parent of new awards
for such outstanding Awards, provided that the substitution of Options or SARs shall
comply with section 424(a) of the Code (whether or not the Options are ISOs).

          (d) Full exercisability of outstanding Options and SARs and full vesting of the
Common Shares subject to such Options and SARs, followed by the cancellation of such
Options and SARs. The full exercisability of such Options and SARs and full vesting
of such Common Shares may be contingent on the closing of such merger or
consolidation. The Optionees shall be able to exercise such Options and SARs during
a period of not less than five full business days preceding the closing date of such
merger or consolidation, unless (i) a shorter period is required to permit a timely
closing of such merger or consolidation and (ii) such shorter period still offers
the Optionees a reasonable opportunity to exercise such Options and SARs. Any
exercise of such Options and SARs during such period may be contingent on the
closing of such merger or consolidation.

9

 

          (e) The cancellation of outstanding Options and SARs and a payment to the
Optionees equal to the excess of (i) the Fair Market Value of the Common Shares
subject to such Options and SARs (whether or not such Options and SARs are then
exercisable or such Common Shares are then vested) as of the closing date of such
merger or consolidation over (ii) their Exercise Price. Such payment shall be made
in the form of cash, cash equivalents, or securities of the surviving corporation or
its parent with a Fair Market Value equal to the required amount. Such payment may
be made in installments and may be deferred until
the date or dates when such Options and SARs would have become exercisable or
such Common Shares would have vested. Such payment may be subject to vesting based
on the Optionee’s continuing Service, provided that the vesting schedule shall not
be less favorable to the Optionee than the schedule under which such Options and
SARs would have become exercisable or such Common Shares would have vested. If the
Exercise Price of the Common Shares subject to such Options and SARs exceeds the
Fair Market Value of such Common Shares, then such Options and SARs may be cancelled
without making a payment to the Optionees. For purposes of this Subsection (e), the
Fair Market Value of any security shall be determined without regard to any vesting
conditions that may apply to such security.

          (f) The cancellation of outstanding Stock Units and a payment to the
Participants equal to the Fair Market Value of the Common Shares subject to such
Stock Units (whether or not such Stock Units are then vested) as of the closing date
of such merger or consolidation. Such payment shall be made in the form of cash,
cash equivalents, or securities of the surviving corporation or its parent with a
Fair Market Value equal to the required amount. Such payment may be made in
installments and may be deferred until the date or dates when such Stock Units would
have vested. Such payment may be subject to vesting based on the Participant’s
continuing Service, provided that the vesting schedule shall not be less favorable
to the Participant than the schedule under which such Stock Units would have vested.
For purposes of this Subsection (f), the Fair Market Value of any security shall be
determined without regard to any vesting conditions that may apply to such security.

     ARTICLE 11. AWARDS UNDER OTHER PLANS.

          The Company may grant awards under other plans or programs. Such awards may be settled in the
form of Common Shares issued under this Plan. Such Common Shares shall be treated for all purposes
under the Plan like Common Shares issued in settlement of Stock Units and shall, when issued,
reduce the number of Common Shares available under Article 3.

     ARTICLE 12. PAYMENT OF DIRECTOR’S FEES IN SECURITIES.

          12.1 Effective Date. No provision of this Article 12 shall be effective unless and until the
Board has determined to implement such provision.

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          12.2 Elections to Receive NSOs, Restricted Shares or Stock Units. An Outside Director may
elect to receive his or her annual retainer payments and/or meeting fees from the Company in the
form of cash, NSOs, Restricted Shares or Stock
Units, or a combination thereof, as determined by the Board. Such NSOs, Restricted Shares and
Stock Units shall be issued under the Plan. An election under this Article 12 shall be filed with
the Company on the prescribed form.

          12.3 Number and Terms of NSOs, Restricted Shares or Stock Units. The number of NSOs,
Restricted Shares or Stock Units to be granted to Outside Directors in lieu of annual retainers and
meeting fees that would otherwise be paid in cash shall be calculated in a manner determined by the
Board. The terms of such NSOs, Restricted Shares or Stock Units shall also be determined by the
Board.

     ARTICLE 13. LIMITATION ON RIGHTS.

          13.1 Retention Rights. Neither the Plan nor any Award granted under the Plan shall be deemed
to give any individual a right to remain an Employee, Outside Director or Consultant. The Company
and its Parents, Subsidiaries and Affiliates reserve the right to terminate the Service of any
Employee, Outside Director or Consultant at any time, with or without cause, subject to applicable
laws, the Company’s certificate of incorporation and by-laws and a written employment agreement (if
any).

          13.2 Stockholders’ Rights. A Participant shall have no dividend rights, voting rights or
other rights as a stockholder with respect to any Common Shares covered by his or her Award prior
to the time when a stock certificate for such Common Shares is issued or, if applicable, the time
when he or she becomes entitled to receive such Common Shares by filing any required notice of
exercise and paying any required Exercise Price. No adjustment shall be made for cash dividends or
other rights for which the record date is prior to such time, except as expressly provided in the
Plan.

          13.3 Regulatory Requirements. Any other provision of the Plan notwithstanding, the obligation
of the Company to issue Common Shares under the Plan shall be subject to all applicable laws, rules
and regulations and such approval by any regulatory body as may be required. The Company reserves
the right to restrict, in whole or in part, the delivery of Common Shares pursuant to any Award
prior to the satisfaction of all legal requirements relating to the issuance of such Common Shares,
to their registration, qualification or listing or to an exemption from registration, qualification
or listing.

     ARTICLE 14. WITHHOLDING TAXES.

          14.1 General. To the extent required by applicable federal, state, local or foreign law, a
Participant or his or her successor shall make arrangements satisfactory to the Company for the
satisfaction of any withholding tax obligations that arise in connection with the Plan. The
Company shall not be required to issue any Common Shares or make any cash payment under the Plan
until such obligations are satisfied.

          14.2 Share Withholding. To the extent that applicable tax laws subject a Participant to tax
withholding obligations, the Committee may permit such Participant to satisfy

11

 

all or part of such
obligations by having the Company withhold all or a portion of any Common Shares that otherwise
would be issued to him or her or by surrendering all or a portion of any Common Shares that he or
she previously acquired. Such Common Shares shall be valued at their Fair Market Value on the date
when they are withheld or surrendered. This Section 14.2 shall apply only to the minimum extent
required by applicable tax laws.

     ARTICLE 15. FUTURE OF THE PLAN.

          15.1 Term of the Plan. The Plan, as set forth herein, shall become effective on the IPO Date.
The Plan shall remain in effect until the earlier of (a) the date when the Plan is terminated
under Section 15.2 or (b) the 10th anniversary of the date when the Board adopted the
Plan.

          15.2 Amendment or Termination. The Board may, at any time and for any reason, amend or
terminate the Plan. No Awards shall be granted under the Plan after the termination thereof. The
termination of the Plan, or any amendment thereof, shall not affect any Award previously granted
under the Plan.

          15.3 Stockholder Approval. An amendment of the Plan shall be subject to the approval of the
Company’s stockholders only to the extent required by applicable laws, regulations or rules.
However, section 162(m) of the Code may require that the Company’s stockholders approve the
performance criteria set forth in Appendix A not later than the first meeting of stockholders that
occurs in the fifth year following the year in which the Company’s stockholders previously approved
such criteria.

     ARTICLE 16. DEFINITIONS.

          16.1 “Affiliate” means any entity other than a Subsidiary, if the Company and/or one or more
Subsidiaries own not less than 50% of such entity.

          16.2 “Award” means any award of an Option, an SAR, a Restricted Share or a Stock Unit under
the Plan.

          16.3 “Board” means the Company’s Board of Directors, as constituted from time to time.

          16.4 “Change in Control” means:

          (a) The consummation of a merger or consolidation of the Company with or into
another entity or any other corporate reorganization, if persons who were not
stockholders of the Company immediately prior to such merger, consolidation or other
reorganization own immediately after such merger, consolidation or other
reorganization 50% or more of the voting power of the outstanding securities of each
of (i) the continuing or surviving entity and (ii) any direct or indirect parent
corporation of such continuing or surviving entity;

          (b) The sale, transfer or other disposition of all or substantially all of the
Company’s assets;

12

 

          (c) A change in the composition of the Board, as a result of which fewer than
50% of the incumbent directors are directors who either:

          (i) Had been directors of the Company on the date 24 months
prior to the date of such change in the composition of the Board
(the “Original Directors”); or

          (ii) Were appointed to the Board, or nominated for election to
the Board, with the affirmative votes of at least a majority of the
aggregate of (A) the Original Directors who were in office at the
time of their appointment or nomination and (B) the directors whose
appointment or nomination was previously approved in a manner
consistent with this Paragraph (ii); or

          (d) Any transaction as a result of which any person is the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing at least 50% of the total voting power
represented by the Company’s then outstanding voting securities. For purposes of
this Subsection (d), the term “person” shall have the same meaning as when used in
sections 13(d) and 14(d) of the Exchange Act but shall exclude (i) a trustee or
other fiduciary holding securities under an employee benefit plan of the Company or
of a Parent or Subsidiary and (ii) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their ownership
of the common stock of the Company.

A transaction shall not constitute a Change in Control if its sole purpose is to change the state
of the Company’s incorporation or to create a holding company that will be owned in substantially
the same proportions by the persons who held the Company’s securities immediately before such
transaction.

          16.5 “Code” means the Internal Revenue Code of 1986, as amended.

          16.6 “Committee” means the Compensation Committee of the Board, as further described in
Article 2.

          16.7 “Common Share” means one share of the common stock of the Company.

          16.8 “Company” means DemandTec, Inc., a Delaware corporation.

          16.9 “Consultant” means a consultant or adviser who provides bona fide services to the
Company, a Parent, a Subsidiary or an Affiliate as an independent contractor.

          16.10 “Employee” means a common-law employee of the Company, a Parent, a Subsidiary or an
Affiliate.

          16.11 “Exchange Act” means the Securities Exchange Act of 1934, as amended.

13

 

          16.12 “Exercise Price,” in the case of an Option, means the amount for which one Common Share
may be purchased upon exercise of such Option, as specified in the applicable Stock Option
Agreement. “Exercise Price,” in the case of an SAR, means an amount, as specified in the
applicable SAR Agreement, which is subtracted from the Fair Market Value of one Common Share in
determining the amount payable upon exercise of such SAR.

          16.13 “Fair Market Value” means the price at which Common Shares were last sold in the
principal U.S. market for Common Shares on the applicable date or, if the applicable date was not a
trading day, on the last trading day prior to the applicable date. If Common Shares are no longer
traded on a public U.S. securities market, the Fair Market Value shall be determined by the
Committee in good faith on such basis as it deems appropriate. The Committee’s determination shall
be conclusive and binding on all persons.

          16.14 “IPO Date” means the effective date of the registration statement filed by the Company
with the Securities and Exchange Commission for its initial offering of Common Shares to the
public.

          16.15 “ISO” means an incentive stock option described in section 422(b) of the Code.

          16.16 “Limitation Period” means any period of three consecutive fiscal years of the Company.

          16.17 “NSO” means a stock option not described in sections 422 or 423 of the Code.

          16.18 “Option” means an ISO or NSO granted under the Plan and entitling the holder to purchase
Common Shares.

          16.19 “Optionee” means an individual or estate holding an Option or SAR.

          16.20 “Outside Director” means a member of the Board who is not an Employee.

          16.21 “Parent” means any corporation (other than the Company) in an unbroken chain of
corporations ending with the Company, if each of the corporations other than the Company owns stock
possessing 50% or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain. A corporation that attains the status of a Parent on a date
after the adoption of the Plan shall be considered a Parent commencing as of such date.

          16.22 “Participant” means an individual or estate holding an Award.

          16.23 “Plan” means this DemandTec, Inc. 2007 Equity Incentive Plan, as amended from time to
time.

          16.24 “Restricted Share” means a Common Share awarded under the Plan.

14

 

          16.25 “Restricted Stock Agreement” means the agreement between the Company and the recipient
of a Restricted Share that contains the terms, conditions and restrictions pertaining to such
Restricted Share.

          16.26 “SAR” means a stock appreciation right granted under the Plan.

          16.27 “SAR Agreement” means the agreement between the Company and an Optionee that contains
the terms, conditions and restrictions pertaining to his or her SAR.

          16.28 “Service” means service as an Employee, Outside Director or Consultant.

          16.29 “Stock Option Agreement” means the agreement between the Company and an Optionee that
contains the terms, conditions and restrictions pertaining to his or her Option.

          16.30 “Stock Unit” means a bookkeeping entry representing the equivalent of one Common Share,
as awarded under the Plan.

          16.31 “Stock Unit Agreement” means the agreement between the Company and the recipient of a
Stock Unit that contains the terms, conditions and restrictions pertaining to such Stock Unit.

          16.32 “Subsidiary” means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company, if each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain. A
corporation that attains the status of a Subsidiary on a date after the adoption of the Plan
shall be considered a Subsidiary commencing as of such date.

     ARTICLE 17. EXECUTION.

          To
record the adoption of the Plan by the Board on May  22, 2007, the Company has caused
its duly authorized officer to execute this document in the name of the Company.

	 	 	 	 	 	 	 
	 	 	DemandTec, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Dan Fishback	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	President and Chief Executive
Officer	 	 
	 

	 	 	 	 	 	 

15

 

Appendix A

Performance Criteria for Restricted Shares and Stock Units

The Committee may establish milestones derived from the following criteria when it makes
Awards of Restricted Shares or Stock Units that vest entirely or in part on the basis of
performance:

	•	 	Backlog
	 
	•	 	Bookings (including annual or total contract value bookings)
	 
	•	 	Cash
	 
	•	 	Cash and short-term investments
	 
	•	 	Cash flow return on investment
	 
	•	 	Comparisons with various stock market indices
	 
	•	 	Deferred revenue
	 
	•	 	Earnings and earnings per share (including earnings before taxes, earnings before interest and taxes or earnings before
interest, taxes, depreciation and amortization)
	 
	•	 	Free cash flow
	 
	•	 	Free cash flow per share
	 
	•	 	Gross profits
	 
	•	 	Headcount
	 
	•	 	Implementation, completion or attainment of measurable objectives with respect to research, development, products,
projects or recruiting and maintaining personnel
	 
	•	 	Improvement in, or attainment of, expense levels or working capital levels
	 
	•	 	Market share
	 
	•	 	Net income (before or after taxes)
	 
	•	 	Operating margin or cash margin
	 
	•	 	Operating profit/loss (on a GAAP or non-GAAP basis)
	 
	•	 	Pre- or after-tax income (before or after allocation of corporate overhead and bonus)
	 
	•	 	Reductions in costs
	 
	•	 	Return on equity
	 
	•	 	Revenue
	 
	•	 	Revenue growth

16

 

	•	 	Solution delivery margin contribution
	 
	•	 	Solution delivery utilization
	 
	•	 	Stock price
	 
	•	 	Total expenses
	 
	•	 	Total stockholder return

The attainment of performance goals may be measured solely on a corporate, subsidiary or business
unit basis, or a combination thereof. Performance criteria may reflect absolute entity performance
or a relative comparison of entity performance to the performance of a peer group of entities or
other external measure of the selected performance criteria. To the extent consistent with section
162(m) of the Code, the Committee may adjust the results under any performance criterion to exclude
any of the following events that occurs during a performance measurement period: (a) asset
write-downs, (b) litigation, claims, judgments or settlements, (c) the effect of changes in tax
law, accounting principles or other such laws or provisions affecting reported results, (d)
accruals for reorganization and restructuring programs and (e) any extraordinary, unusual or
non-recurring items.

17

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