Document:

exv10w4

 

Exhibit 10.4

SAPIENT CORPORATION

RESTRICTED STOCK UNITS

AGREEMENT

     In recognition of the important contributions that the employee whose name appears on the
Notice attached to this Agreement and incorporated herein by this reference (the “Employee”) makes
to the success of Sapient Corporation (the “Company” or “Sapient”) and its Affiliates (together
with the Company, the “Company Group”), pursuant to the Sapient Corporation 1998 Stock Incentive
Plan (the “Plan”), the Company hereby grants to the Employee the Restricted Stock Units Award
described below.

	1.	 	The Restricted Stock Unit Award. The Company hereby grants to the Employee the number of
restricted stock units (the “Units”) set forth on the Notice, subject to the terms and
conditions of this Agreement and the Plan. An Award shall be paid hereunder, only to the
extent that such Award is Vested, as provided in this Agreement. The Employee’s rights to the
Units are subject to the restrictions described in this Agreement and the Plan in addition to
such other restrictions, if any, as may be imposed by law.

	2.	 	Definitions. The following definitions will apply for purposes of this Agreement.
Capitalized terms not defined in this Agreement are used as defined in the Plan and the
Notice.

	 	(a)	 	“Agreement” means this Restricted Stock Units Agreement granted by the
Company and agreed to by the Employee.
	 
	 	(b)	 	“Award” means the grant of Units in accordance with this Agreement.
	 
	 	(c)	 	“Common Stock” means common stock of the Company, $.01 par value.
	 
	 	(d)	 	“Fair Market Value” means the per share closing price of a share of
Sapient Common Stock on the Nasdaq trading day immediately preceding the applicable
Vesting Date.
	 
	 	(e)	 	“Grant Date” means the date designated as the Date of Grant on the
Notice.
	 
	 	(f)	 	“NASDAQ” means the Nasdaq Stock Market.
	 
	 	(g)	 	“Notice” means the Notice of Restricted Stock Units Award attached to
this Agreement and incorporated herein by reference.
	 
	 	(h)	 	“Payment Date” means, as to Vested Units, within 30 days of the date on
which the Units become Vested.

 

 

	 	(i)	 	“Unit” means a notional unit which is equivalent to a single share of
Common Stock on the Grant Date, subject to Section 4.
	 
	 	(j)	 	“Vested” means that portion of the Award to which the Employee has a
nonforfeitable right.
	 
	 	(k)	 	“Vesting Dates” means the dates listed in the Vesting Schedule on the
attached Notice.

3. Vesting.

	 	(a)	 	An Award shall become Vested only upon the Vesting Dates as set forth in the
Vesting Schedule, except as otherwise provided herein or determined by the Company in
its sole discretion. No portion of any Award shall become Vested on the Vesting Date
unless the Employee is then, and since the Grant Date has continuously been, employed
by a member of the Company Group.
	 
	 	(b)	 	In the event that the Employee’s employment terminates prior to a Vesting Date
for any reason, including without limitation (1) death, (2) disability, or (3)
termination by the Company or the Company Group, or (4) other termination of
employment, any portion of the Award that has not then become Vested will be forfeited
automatically.
	 
	 	(c)	 	In the event of a merger or acquisition of the Company in which the Company is
not the surviving entity, or a sale of substantially all of the Company’s assets, the
Company may, in its sole discretion, accelerate the Vesting of all or any portion of
any Award, unless the surviving entity agrees to assume or provide substituted awards
in respect of the portion of the Awards that have not yet become Vested.

	4.	 	Adjustments Based on Certain Changes in the Common Stock. In the event of any stock split,
reverse stock split, stock dividend, recapitalization or similar change affecting the Common
Stock, the Award shall be equitably adjusted.

	5.	 	No Voting Rights/Dividends. The Award shall not be interpreted to bestow upon the Employee
any equity interest or ownership in the Company Group prior to the Payment Date. The Employee
is not entitled to vote any Common Stock by reason of the granting of this Award or to receive
or be credited with any dividends declared and payable on any Common Stock underlying any
Award prior to any Payment Date

	6.	 	Payment of Award. On the Payment Date, the Company shall issue to the Employee that number
of shares of Common Stock as equals that number of Units which have become Vested.

	7.	 	Employment Rights. This Agreement shall not create any right of the Employee to continued
employment with the Company or the Company Group or limit the right of the Company Group to
terminate the Employee’s employment at any time and shall not create any right of the Employee
to employment with the Company Group. The Employee acknowledges and represents to the Company
that the Employee has not been

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	 	 	induced to receive any Award by expectation of employment or continued employment. Except
to the extent required by applicable law that cannot be waived, the loss of the Award shall
not constitute an element of damages or indemnity in the event of termination of the
Employee’s employment even if the termination is determined to be in violation of an
obligation of the Company Group to the Employee by contract or otherwise.

	8.	 	Unfunded Status. The obligations of the Company Group hereunder shall be contractual only.
The Employee shall rely solely on the unsecured promise of the Company and nothing herein
shall be construed to give the Employee or any other person or persons any right, title,
interest or claim in or to any specific asset, fund, reserve, account or property of any kind
whatsoever owned by the Company Group.

	9.	 	No Assignment. No right or benefit or payment under the Plan shall be subject to assignment
or other transfer nor shall it be liable or subject in any manner to attachment, garnishment
or execution.

	10.	 	Withholding. The Company’s obligation to deliver to the Employee shares of Common Stock
under an Award shall be subject to the satisfaction of all applicable federal, state and local
income and employment tax withholding requirements as determined by the Company Group
(“Withholding Taxes”). To satisfy any Withholding Taxes due upon vesting of the Employee’s
Units, the Employee agrees to pay to the Company, or make provision satisfactory to the
Company for payment of, any Withholding Taxes, no later than the Payment Date. The Company
and any Affiliate may, to the extent permitted by law, deduct any such tax obligations from
any payment of any kind due to the Employee. Such withheld amounts shall include shares
retained from the Award creating the tax obligation, valued at their Fair Market Value on the
date of retention.

Further, as a condition of receiving any Vested Award, the Employee hereby agrees to the
terms of the Irrevocable Standing Order to Sell Shares (the “Standing Order”), attached as
Exhibit A. Pursuant to the Standing Order, and in lieu of taking the actions
described in the immediately preceding paragraph of this Section 10, the Company, in its
sole discretion, may require, and, in such event the Employee agrees, to the following:

	 	(a)	 	The Employee authorizes the Company’s agent to sell, at the market price and on
each Vesting Date (or the first NASDAQ trading day thereafter if a Vesting Date is a
day in which NASDAQ is closed), the number of Vested shares that, per the Company’s
instructions to its agent, is necessary to obtain proceeds sufficient to satisfy the
Withholding Taxes. The Employee understands and agrees that the number of shares that
such agent will sell will be based on the closing price of the Common Stock on the
NASDAQ trading day immediately preceding the Vesting Date.

	 	(b)	 	The Employee agrees that the proceeds received from the sale of Vested shares
pursuant to this Section 10 will be used to satisfy the Withholding Taxes and,
accordingly, the Employee hereby authorizes the Company’s agent to pay such proceeds to
the Company for such purpose. The Employee understands that to the

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	 	 	 	extent that the proceeds obtained by such sale exceed the amount necessary to satisfy
the Withholding Taxes, such excess proceeds shall be deposited into the Employee’s
stock brokerage account with E*TRADE Financial or such other third party brokerage
under which the Employee maintains a brokerage account (the “Account”). The Employee
further understands that any remaining Vested shares shall be deposited into the
Account.

	 	(c)	 	The Employee acknowledges and agrees that, in the event that a market in the
Common Stock does not exist, the Employee shall pay to the Company amounts sufficient
to pay the Withholding Taxes and, to the extent that such payment is not made, the
Company shall have the right to make other arrangements to satisfy the Withholding
Taxes due upon the vesting of the Employee’s Shares.

	11.	 	Amendment or Termination. This Agreement may be amended by mutual written agreement of the
parties.

	12.	 	Governing Law. This Agreement shall be governed by, and construed in accordance with, the
laws of the Commonwealth of Massachusetts.

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     IN WITNESS WHEREOF, Sapient Corporation has executed this Restricted Stock Units Agreement as
of the ___day of ___, 200_.

	 	 	 	 	 
	 	SAPIENT CORPORATION

 	 
	 	By:  	 	 
	 	 	Alan J. Herrick 	 
	 	 	Chief Executive Officer 	 

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Exhibit A

IRREVOCABLE STANDING ORDER TO SELL SHARES

I have received from the Company on a voluntary basis the right to acquire shares of Sapient common
stock (the “Shares”) pursuant to the attached Restricted Stock Units Agreement between Sapient and
me.

I understand that I must maintain a securities brokerage account with E*TRADE Financial or such
other third party brokerage (each of E*TRADE Financial or such other third party brokerage is
herein defined as the “Broker”) to participate in the stock unit plan described in detail in the
Restricted Stock Units Agreement, and Sapient has informed me about this requirement as well as the
requirements for the opening of such a securities brokerage account so that the vested Shares can
be deposited into account. Furthermore, I understand that on each vesting date, the vested Shares
will be deposited into my stock brokerage account with the broker and that I will incur taxable
ordinary employment income (“Taxable Income”) upon my receipt of the vested Shares. Per the terms
of the Agreement, and if so directed by Sapient, I understand and agree to do the following as a
condition of my receipt of vested Shares:

Upon each vesting date, I must sell a number of Shares that is sufficient to
satisfy all withholding taxes, as determined by Sapient or my Sapient-affiliated
employer, which are applicable to my Taxable Income (the “Withholding Taxes”).
Accordingly, I HEREBY DIRECT THE BROKER TO SELL, ON EACH VESTING DATE LISTED ABOVE
(OR THE FIRST NASDAQ TRADING DAY THEREAFTER IF A VESTING DATE IS A DAY ON WHICH
NASDAQ IS CLOSED), THAT NUMBER OF SHARES THAT, PER SAPIENT’S INSTRUCTIONS TO THE
AGENT, IS SUFFICIENT TO OBTAIN SALE PROCEEDS SUFFICIENT TO SATISFY THE WITHHOLDING
TAXES. THE PER SHARE SALES PRICE SHALL BE CALCULATED BASED ON THE CLOSING PRICE
OF A SHARE OF SAPIENT COMMON STOCK ON THE NASDAQ TRADING DAY IMMEDIATELY PRECEDING
THE APPLICABLE VESTING DATE.

I understand that the Broker will remit the proceeds of the foregoing sale promptly to Sapient for
payment by Sapient or my Sapient-affiliated employer of the Withholding Taxes, and I authorize and
direct the Broker to pay such proceeds to Sapient for this purpose.

I acknowledge that I have not been induced to participate in any trade in return for or as an
expectation of employment or continued employment. I understand and agree that by signing below, I
am making an Irrevocable Standing Order to Sell Shares that will remain in effect until such time
as I have received all Shares to which I am entitled under this Agreement. I also agree that this
Irrevocable Standing Order to Sell Shares is in addition and subject to the terms and conditions of
any existing Account Agreement that I have with the Broker.

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Exhibit 10.5

[Amendment Approved by Stockholders

on August 16, 2007]

AMENDMENT

TO

SAPIENT CORPORATION

1998 STOCK INCENTIVE PLAN

     WHEREAS, Sapient Corporation (the “Company”) established the 1998 Stock Incentive Plan
effective March 24, 1998 and authorized the issuance of options to acquire common stock, $.01 par
value, of the Company thereunder up to a limit specified in the Plan;

     WHEREAS, on May 8, 1998 the shareholders of the Company voted to approve the Plan;

     WHEREAS, the Board of Directors of the Company delegated the administration of the Plan and
issuance of the options thereunder to the Compensation Committee of the Board of Directors (the
“Committee”);

     WHEREAS, the terms of the Plan provide that, after March 24, 2008, no further options will be
permitted to be issued under the Plan;

     WHEREAS, the Committee has not granted awards for all of the shares of common stock authorized
under the Plan;

     WHEREAS, upon recommendation of the Committee, the Board desires to amend the Plan to extend
the time during which awards can be made under the Plan for a period of up to 5 years, so that the
Committee may grant awards for shares remaining under the Plan that were authorized previously but
remain available for awards;

     WHEREAS, upon recommendation of the Committee, the Board desires to add a Plan provision that
authorizes the payment of performance-based cash bonuses to eligible employees, subject to the
limitations set forth herein; and

     WHEREAS, Section 11(d) of the Plan reserves to the Company the right to amend the Plan,
provided that no such amendment shall be effective unless and until approved by stockholders of the
Company as required by Section 162(m) of the Internal Revenue Code of 1986, as amended (the
“Code”).

     NOW, THEREFORE, the Plan is hereby amended as follows, effective as of date on which
such amendment is approved by stockholders of the Company:

 

 

1.     Section 4(b) is amended in its entirety to read as follows:

"(b) Per Participant Limit. Subject to adjustment under Section 8, the maximum
number of shares of Common Stock for which Options may be granted to any person in any
calendar year and the maximum number of shares of Restricted Stock granted to any person in
any calendar year will each be 1,000,000. The maximum number of shares subject to other
stock-based Awards granted to any person in any calendar year will be one million
(1,000,000) shares. The maximum dollar amount of any cash bonus payable to any single
Participant under Section 6A of the Plan in any calendar year shall be two million dollars
(U.S. $2,000,000). The per-Participant limits described in this Section 4(b) shall be
construed and applied consistently with Section 162(m) of the Code.

2.     A new Section 6A is hereby added to read in its entirety as follows:

“6A. BONUSES. The Board may grant cash bonus awards (“Bonus Awards”) to Participants on
the terms and conditions set forth herein. The Board shall select those Participants (each
a “Bonus Participant”) under the Plan who shall be eligible to receive a Bonus Award, which
may be a Performance Award, and the terms and conditions of each such Award, including,
without limitation, with respect to Performance Criteria.

3.     Section 11(c) of the Plan shall be amended to read in its entirety as follows:

“The Plan became effective on May 8, 1998, the date on which it was originally adopted by
stockholders, and provided that no Awards could be granted after March 24, 2008. On March
29, 2007, the Plan was amended, subject to stockholder approval, so that no Awards could be
granted after the first to occur of March 29, 2012, and the time at which no Common Stock
is available for Awards. Accordingly, no Awards may be made after that date, but Awards
previously granted may extend beyond that date in accordance with their terms. No Incentive
Stock Option may be granted under the Plan after March 24, 2008.

4.     A new Section 12 is added to read in its entirety as follows:

“12. PERFORMANCE AWARDS.

(a) GENERALLY. A Performance Award is an Award that is subject to Performance
Criteria. The Committee, in its discretion, may grant Performance Awards that are intended
to qualify for the performance-based compensation exception under Section 162(m) of the
Code and Performance Awards that are not intended so to qualify.

(b) PERFORMANCE CRITERIA. Performance criteria (“Performance Criteria”) are
specified criteria, other than the mere continuation of Employment

 

 

or the mere passage of time, the satisfaction of which is a condition for the grant,
exercisability, vesting or full enjoyment of an Award. For purposes of Awards that are
intended to qualify for the performance-based compensation exception under Section 162(m)
of the Code, a Performance Criterion will mean an objectively determinable measure of
performance relating to any or any combination of the following (measured either absolutely
or by reference to an index or indices and determined either on a consolidated basis or, as
the context permits, on a divisional, subsidiary, line of business, project or geographical
basis or in combinations thereof): sales; revenues; assets; expenses; earnings before or
after deduction for all or any portion of interest, taxes, depreciation, or amortization,
whether or not on a continuing operations or an aggregate or per share basis; return on
equity, investment, capital or assets; one or more operating ratios; borrowing levels,
leverage ratios or credit rating; market share; capital expenditures; cash flow; stock
price; stockholder return; sales of particular products or services; customer satisfaction
scores ; acquisitions and divestitures (in whole or in part); joint ventures and strategic
alliances; spin-offs, split-ups and the like; reorganizations; or recapitalizations,
restructurings, financings (issuance of debt or equity) or refinancings. A Performance
Criterion and any targets with respect thereto determined by the Board need not be based
upon an increase, a positive or improved result or avoidance of loss. To the extent
consistent with the requirements for satisfying the performance-based compensation
exception under Section 162(m) of the Code, the Board may provide, in the case of any Award
intended to qualify for such exception, that one or more of the Performance Criteria
applicable to such Award will be adjusted in an objectively determinable manner to reflect
events (for example, but without limitation, acquisitions or dispositions) occurring during
the performance period that affect the applicable Performance Criterion or Criteria. The
Board shall have the authority to exercise subjective discretion to reduce (but not
increase) awards payouts below the levels indicated by the strict application of the
Performance Criteria, based on factors it deems appropriate in its sole discretion.”

Executed this 29th day of March, 2007.

	 	 	 	 	 
	 	SAPIENT CORPORATION

 	 
	 	By:  	/s/
Jane E. Owens
 	 
	 	 	Title: Secretary

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