Document:

Exhibit 10.4

 

PHASE FORWARD INCORPORATED

AMENDED AND RESTATED 2004
EMPLOYEE STOCK PURCHASE PLAN

 

Article 1
- Purpose.

 

This
2004 Employee Stock Purchase Plan (the “Plan”) is intended to encourage stock
ownership by all eligible employees of Phase Forward Incorporated (the “Company”), a Delaware corporation, and its
participating subsidiaries (as defined in Article 17) so that they may
share in the growth of the Company by acquiring or increasing their proprietary
interest in the Company.  The Plan is
designed to encourage eligible employees to remain in the employ of the Company
and its participating subsidiaries.  The
Plan is intended to constitute an “employee stock purchase plan” within the
meaning of Section 423(b) of the Internal Revenue Code of 1986, as
amended (the “Code”).  Purchase options
are to be granted under the Plan only to employees of the Company or its
subsidiaries as provided in Article 3.

 

Article 2
- Administration of the Plan.

 

This
Plan shall be administered by the Board or by a committee appointed by the
Board (the “Committee”). In the event the Board fails to appoint or refrains
from appointing a Committee, the Board shall have all power and authority to
administer this Plan. In such event, the word “Committee” wherever used herein
shall be deemed to mean the Board. The Committee shall, subject to the
provisions of the Plan, have the power to construe this Plan, to determine all
questions hereunder, and to adopt and amend such rules and regulations for
the administration of this Plan as it may deem desirable. No member of the
Board or the Committee shall be liable for any action or determination made in
good faith with respect to this Plan or any option granted under it.

 

The Committee may delegate to one or more individuals
the day-to-day administration of the Plan. 
Without limitation, subject to the terms and conditions of this Plan,
the President, the Chief Financial Officer of the Company, and any other
officer of the Company or committee of officers or employees designated by the
Committee (collectively, the “Plan administrators”), shall each be authorized
to determine the methods through which eligible employees may elect to
participate, amend their participation, or withdraw from participation in the
Plan, and establish methods of enrollment for employees of the Company and its
participating subsidiaries.  The Plan
administrators are further authorized to determine the matters described in Article 11
concerning the means of issuance of Common Stock and the procedures established
to permit tracking of disqualifying dispositions of shares or to restrict
transfer of such shares.

 

Article 3
- Eligible Employees.

 

All employees of the Company or any of its
participating subsidiaries whose customary employment is more than
20 hours per week and for more than five months in any calendar
year and who have completed at least 90 days of employment with us on or
before the first day of any Payment Period (as defined in Article 5) shall
be eligible to receive purchase options under

 

 

the
Plan to purchase common stock of the Company, and all eligible employees shall
have the same rights and privileges hereunder. 
Persons who are eligible employees on the first business day of any
Payment Period  shall receive their
purchase options as of such day.  Persons
who become eligible employees after any date on which purchase options are
granted under the Plan shall be granted purchase options on the first day of
the next succeeding Payment Period on which purchase options are granted to
eligible employees under the Plan.  In no
event, however, may an employee be granted a purchase option if such employee,
immediately after the purchase option was granted, would be treated as owning
stock possessing five percent or more of the total combined voting power or
value of all classes of stock of the Company or of any parent corporation or
subsidiary corporation, as the terms “parent corporation” and “subsidiary
corporation” are defined in Section 424(e) and (f) of the
Code.  For purposes of determining stock
ownership under this paragraph, the rules of Section 424(d) of
the Code shall apply, and stock which the employee may purchase under
outstanding purchase options shall be treated as stock owned by the employee.

 

Article 4
- Stock Subject to the Plan.

 

The
stock subject to the purchase options under the Plan shall be shares of the
Company’s authorized but unissued common stock,
par value $0.01 per share (the “Common Stock”), or shares of Common Stock
reacquired by the Company, including shares purchased in the open market.  The aggregate number of shares which may be
issued pursuant to the Plan is three hundred twenty thousand (320,000), subject
to adjustment as provided in Article 12. 
If any purchase option granted under the Plan shall expire or terminate
for any reason without having been exercised in full or shall cease for any
reason to be exercisable in whole or in part, the unpurchased shares subject
thereto shall again be available under the Plan.

 

Article 5
- Payment Period and Purchase Options.

 

The
first Payment Period during which payroll deductions will be accumulated under
the Plan shall commence on such date as is determined by the Board (or
Committee) and shall end on November 30, 2004 (the “First Payment Period”).  For the remainder of the duration of the
Plan, Payment Periods shall consist of the six-month periods commencing on December 1
and June 1 and ending on the last days of November and May of
each calendar year.

 

Twice
each year, on the first business day of each Payment Period, the Company will
grant to each eligible employee who is then a participant in the Plan a
purchase option to purchase on the last day of such Payment Period, at the
Option Price hereinafter provided for, a maximum of 5,000 shares, on
condition that such employee remains eligible to participate in the Plan
throughout the remainder of such Payment Period.  The participant shall be entitled to exercise
the purchase option so granted only to the extent of the participant’s
accumulated payroll deductions on the last day of such Payment Period.  If the participant’s accumulated payroll
deductions on the last day of the Payment Period would enable the participant
to purchase more than 5,000 shares except for the 5,000-share limitation, the
excess of the amount of the accumulated payroll deductions over the aggregate
purchase price of the 5,000 shares shall be promptly refunded to the
participant by the Company, without interest. 
The Option Price per share for each Payment Period shall be 95% of the
average market price of the Common Stock

 

 

on the last business day
of the Payment Period, in either event rounded up to the nearest cent.  The foregoing limitation on the number of
shares subject to purchase option and the Option Price shall be subject to adjustment
as provided in Article 12.

 

For
purposes of the Plan, the term “average market price” on any date means (i) the
average (on that date) of the high and low prices of the Common Stock on the
principal national securities exchange on which the Common Stock is traded, if
the Common Stock is then traded on a national securities exchange; or (ii) the
last reported sale price (on that date) of the Common Stock on the NASDAQ
National Market, if the Common Stock is not then traded on a national
securities exchange; or (iii) the average of the closing bid and asked
prices last quoted (on that date) by an established quotation service for
over-the-counter securities, if the Common Stock is not reported on the NASDAQ
National Market; or (iv) if the Common Stock is not publicly traded, the
fair market value of the Common Stock as determined by the Committee after
taking into consideration all factors which it deems appropriate, including,
without limitation, recent sale and offer prices of the Common Stock in private
transactions negotiated at arm’s length.

 

For
purposes of the Plan, the term “business day” means a day on which there is
trading on the NASDAQ National Market or the aforementioned national securities
exchange, whichever is applicable pursuant to the preceding paragraph; and if
neither is applicable, a day that is not a Saturday, Sunday or legal holiday in
the Commonwealth of Massachusetts.

 

No
employee shall be granted a purchase option which permits the employee’s right
to purchase stock under the Plan, and under all other Section 423(b) employee
stock purchase plans of the Company and any parent or subsidiary corporations,
to accrue at a rate which exceeds $25,000 of fair market value of such stock
(determined on the date or dates that purchase options on such stock were granted)
for each calendar year in which such purchase option is outstanding at any
time.  The purpose of the limitation in
the preceding sentence is to comply with Section 423(b)(8) of the
Code.  If the participant’s accumulated
payroll deductions on the last day of the Payment Period would otherwise enable
the participant to purchase Common Stock in excess of the Section 423(b)(8) limitation
described in this paragraph, the excess of the amount of the accumulated
payroll deductions over the aggregate purchase price of the shares actually
purchased shall be promptly refunded to the participant by the Company, without
interest.

 

Article 6
- Exercise of Purchase Option.

 

Each
eligible employee who continues to be a participant in the Plan on the last day
of a Payment Period shall be deemed to have exercised his or her purchase
option on such date and shall be deemed to have purchased from the Company such
number of full shares of Common Stock reserved for the purpose of the Plan as
the participant’s accumulated payroll deductions on such date will pay for at
the Option Price, subject to the 5,000-share limit of the purchase option and
the Section 423(b)(8) limitation described in Article 5.  If the individual is not a participant on the
last day of a Payment Period, he or she shall not be entitled to exercise his
or her purchase option and the amount of his or her aggregate payroll
deductions for that period will be refunded without interest.  Only full shares of Common Stock may be
purchased under the Plan.  Unused payroll
deductions remaining in a participant’s account at the end of a Payment Period
by reason of the inability to purchase a fractional share shall be carried
forward to the next Payment Period.

 

 

Article 7
- Authorization for Entering the Plan.

 

An
employee may elect to enter the Plan by filling out, signing and delivering to
the Company an authorization in a form specified by the Company:

 

A.                                   Stating
the percentage to be deducted regularly from the employee’s pay;

 

B.                                     Authorizing
the purchase of stock for the employee in each Payment Period in accordance
with the terms of the Plan; and

 

C.                                     Specifying
the exact name or names in which stock purchased for the employee is to be
issued as provided under Article 11 hereof.

 

Such authorization must
be received by the Company before the first day of the next succeeding Payment
Period and shall take effect only if the employee is an eligible employee on
the first business day of such Payment Period, provided, however,
that with respect to the First Payment Period, a purchase option shall be
granted to each eligible employee and such authorization to participate in the
plan must be received no more than three weeks following the first day of the
First Payment Period.

 

Unless
a participant files a new authorization or withdraws from the Plan, the
deductions and purchases under the authorization the participant has on file
under the Plan will continue from one Payment Period to succeeding Payment
Periods as long as the Plan remains in effect.

 

The
Company will accumulate and hold for each participant’s account the amounts
deducted from his or her pay.  No
interest will be paid on these amounts.

 

Article 8
- Maximum Amount of Payroll Deductions.

 

An
employee may authorize payroll deductions in an amount (expressed as a whole
percentage or fixed amount) not more than ten percent (10%) of the
employee’s total compensation, including base pay or salary and any overtime,
bonuses or commissions.

 

Article 9
- Change in Payroll Deductions.

 

Deductions
may not be increased or decreased during a Payment Period.  However, a participant may withdraw in full
from the Plan in which event the Company will refund the amount of the
participant aggregate payroll deductions for that period will be refunded
without interest.

 

Article 10
- Withdrawal from the Plan.

 

A
participant may withdraw from the Plan (in whole but not in part) at any time
prior to the last day of a Payment Period by delivering a withdrawal notice to
the Company in the form specified by the Company.

 

 

To
re-enter the Plan, an employee who has previously withdrawn must file a new
authorization before the first day of the next Payment Period in which he or
she wishes to participate.  The employee’s
re-entry into the Plan becomes effective at the beginning of such Payment
Period, provided that he or she is an eligible employee on the first business
day of the Payment Period.

 

Article 11
- Issuance of Stock.

 

Certificates
for stock issued to participants shall be delivered as soon as practicable
after each Payment Period by the Company’s transfer agent.  Certificates may be issued in paper or
electronic form at the discretion of the Company.

 

Stock
purchased under the Plan shall be issued only in the name of the participant.

 

Article 12
- Adjustments.

 

Upon
the happening of any of the following described events, a participant’s rights
under purchase options granted under the Plan shall be adjusted as hereinafter
provided:

 

A.                                   In
the event that the shares of Common Stock shall be subdivided or combined into
a greater or smaller number of shares or if, upon a reorganization, split-up,
liquidation, recapitalization or the like of the Company, the shares of Common
Stock shall be exchanged for other securities of the Company, each participant
shall be entitled, subject to the conditions herein stated, to purchase such
number of shares of Common Stock or amount of other securities of the Company
as were exchangeable for the number of shares of Common Stock that such
participant would have been entitled to purchase except for such action, and
appropriate adjustments shall be made in the purchase price per share to
reflect such subdivision, combination or exchange; and

 

B.                                     In
the event the Company shall issue any of its shares as a stock dividend upon or
with respect to the shares of stock of the class which shall at the time be
subject to a purchase option hereunder, each participant upon exercising such a
purchase option shall be entitled to receive (for the purchase price paid upon
such exercise) the shares as to which the participant is exercising his or her
purchase option and, in addition thereto (at no additional cost), such number
of shares of the class or classes in which such stock dividend or dividends
were declared or paid, and such amount of cash in lieu of fractional shares, as
is equal to the number of shares thereof and the amount of cash in lieu of
fractional shares, respectively, which the participant would have received if
the participant had been the holder of the shares as to which the participant
is exercising his or her purchase option at all times between the date of the
granting of such purchase option and the date of its exercise.

 

Upon
the happening of any of the foregoing events, the class and aggregate number of
shares set forth in Article 4 hereof which are subject to purchase options
which have been or may be granted under the Plan and the limitations set forth
in the second paragraph of Article 5 shall also be appropriately adjusted
to reflect the events specified in paragraphs A and B above.

 

 

Notwithstanding the
foregoing, any adjustments made pursuant to paragraphs A or B shall be
made only after the Committee, based on advice of counsel for the Company,
determines whether such adjustments would constitute a “modification” (as that
term is defined in Section 424 of the Code).  If the Committee determines that such
adjustments would constitute a modification, it may refrain from making such
adjustments.

 

If the
Company is to be consolidated with or acquired by another entity in a merger, a
sale of all or substantially all of the Company’s assets or otherwise (an “Acquisition”),
the Committee or the board of directors of any entity assuming the obligations
of the Company hereunder (the “Successor Board”) shall, with respect to
purchase options then outstanding under the Plan, either (i) make
appropriate provision for the continuation of such purchase options by
arranging for the substitution on an equitable basis for the shares then
subject to such purchase options either (a) the consideration payable with
respect to the outstanding shares of the Common Stock in connection with the
Acquisition, (b) shares of stock of the successor corporation, or a parent
or subsidiary of such corporation, or (c) such other securities as the
Successor Board deems appropriate, the fair market value of which shall not
materially exceed the fair market value of the shares of Common Stock subject
to such purchase options immediately preceding the Acquisition; or (ii) terminate
each participant’s purchase options in exchange for a cash payment equal to the
excess of (a) the fair market value on the date of the Acquisition, of the
number of shares of Common Stock that the participant’s accumulated payroll
deductions as of the date of the Acquisition could purchase, at a purchase option
price determined with reference only to the first business day of the
applicable Payment Period and subject to the 5,000-share, Code Section 423(b)(8) and
fractional-share limitations on the amount of stock a participant would be
entitled to purchase, over (b) the result of multiplying such number of
shares by such purchase option price.

 

The
Committee or Successor Board shall determine the adjustments to be made under
this Article 12, and its determination shall be conclusive.

 

Article 13
- No Transfer or Assignment of Employee’s Rights.

 

A
purchase option granted under the Plan may not be transferred or assigned,
except by will or the laws of descent and distribution, and may be exercised,
during the participant’s lifetime, only by the participant.

 

Article 14
- Termination of Employee’s Rights.

 

Whenever
a participant ceases to be an eligible employee because of retirement,
voluntary or involuntary termination, resignation, layoff, discharge, death or
for any other reason, his or her rights under the Plan shall immediately
terminate, and the Company shall promptly refund, without interest, the entire
balance of his or her payroll deduction account under the Plan.  Notwithstanding the foregoing, eligible
employment shall be treated as continuing intact while a participant is on
military leave, sick leave or other bona fide leave of absence, for up to
90 days, or for so long as the participant’s right to re-employment is
guaranteed either by statute or by contract, if longer than 90 days.

 

 

Article 15
- Termination and Amendments to Plan.

 

Unless
terminated sooner as provided below, the Plan shall terminate on May 31,
2014.  The Plan may be terminated at any
time by the Company’s Board of Directors but such termination shall not affect
purchase options then outstanding under the Plan.  It will terminate in any case when all or
substantially all of the unissued shares of stock reserved for the purposes of
the Plan have been purchased.  If at any
time shares of stock reserved for the purpose of the Plan remain available for
purchase but not in sufficient number to satisfy all then unfilled purchase
requirements, the available shares shall be apportioned among participants in
proportion to the amount of payroll deductions accumulated on behalf of each
participant that would otherwise be used to purchase stock, and the Plan shall
terminate.  Upon such termination or any
other termination of the Plan, all payroll deductions not used to purchase
stock will be refunded, without interest.

 

The
Committee or the Board of Directors may from time to time adopt amendments to
the Plan provided that, without the approval of the stockholders of the
Company, no amendment may (i) increase the number of shares that may be
issued under the Plan; (ii) change the class of employees eligible to
receive purchase options under the Plan, if such action would be treated as the
adoption of a new plan for purposes of Section 423(b) of the Code; or
(iii) cause Rule 16b-3 under the Securities Exchange Act of 1934
to become inapplicable to the Plan.

 

Article 16
- Limits on Sale of Stock Purchased under the Plan.

 

The
Plan is intended to provide shares of Common Stock for investment and not for
resale.  The Company does not, however,
intend to restrict or influence any employee in the conduct of his or her own
affairs.  An employee may, therefore,
sell stock purchased under the Plan at any time the employee chooses, subject
to compliance with the Company’s insider trading policy, as amended and in
effect from time to time, any applicable federal or state securities laws and
subject to any restrictions imposed under Article 22 to ensure that tax
withholding obligations are satisfied.  THE EMPLOYEE ASSUMES THE RISK OF ANY MARKET FLUCTUATIONS IN THE PRICE
OF THE STOCK.

 

Article 17
- Participating Subsidiaries.

 

The
term “participating subsidiary” shall mean any present or future subsidiary of
the Company, as that term is defined in Section 424(f) of the Code,
which is designated from time to time by the Board of Directors to participate
in the Plan.  The Board of Directors
shall have the power to make such designation before or after the Plan is
approved by the stockholders.

 

Article 18
- Optionees Not Stockholders.

 

Neither
the granting of a purchase option to an employee nor the deductions from his or
her pay shall constitute such employee a stockholder of the shares covered by a
purchase option until such shares have been actually purchased by the employee.

 

 

Article 19
– No Right to Employment or Other Status.

 

Participation
in the Plan shall not be construed as giving a participant the right to
continued employment or any other relationship with the Company.

 

Article 20
- Application of Funds.

 

The
proceeds received by the Company from the sale of Common Stock pursuant to
purchase options granted under the Plan will be used for general corporate
purposes.

 

Article 21
- Notice to Company of Disqualifying Disposition.

 

By
electing to participate in the Plan, each participant agrees to notify the
Company in writing immediately after the participant transfers Common Stock
acquired under the Plan, if such transfer occurs within two years after
the first business day of the Payment Period in which such Common Stock was
acquired.  Each participant further agrees
to provide any information about such a transfer as may be requested by the
Company or any subsidiary corporation in order to assist it in complying with
the tax laws.  Such dispositions
generally are treated as “disqualifying dispositions” under Sections 421 and
424 of the Code, which have certain tax consequences to participants and to the
Company and its participating subsidiaries.

 

Article 22
- Withholding of Additional Income Taxes.

 

By
electing to participate in the Plan, each participant acknowledges that the
Company and its participating subsidiaries are required to withhold taxes with
respect to the amounts deducted from the participant’s compensation and
accumulated for the benefit of the participant under the Plan, and each
participant agrees that the Company and its participating subsidiaries may
deduct additional amounts from the participant’s compensation, when amounts are
added to the participant’s account, used to purchase Common Stock or refunded,
in order to satisfy such withholding obligations.  Each participant further acknowledges that
when Common Stock is purchased under the Plan the Company and its participating
subsidiaries may be required to withhold taxes with respect to all or a portion
of the difference between the fair market value of the Common Stock purchased
and its purchase price, and each participant agrees that such taxes may be
withheld from compensation otherwise payable to such participant.  It is intended that tax withholding will be
accomplished in such a manner that the full amount of payroll deductions elected
by the participant under Article 7 will be used to purchase Common
Stock.  However, if amounts sufficient to
satisfy applicable tax withholding obligations have not been withheld from
compensation otherwise payable to any participant, then, notwithstanding any
other provision of the Plan, the Company may withhold such taxes from the
participant’s accumulated payroll deductions and apply the net amount to the
purchase of Common Stock, unless the participant pays to the Company, prior to
the exercise date, an amount sufficient to satisfy such withholding
obligations.  Each participant further
acknowledges that the Company and its participating subsidiaries may be
required to withhold taxes in connection with the disposition of stock acquired
under the Plan and agrees that the Company or any participating subsidiary may
take whatever action it considers appropriate to satisfy such withholding
requirements, including deducting from compensation otherwise payable to such
participant an amount sufficient to

 

 

satisfy such withholding
requirements or conditioning any disposition of Common Stock by the participant
upon the payment to the Company or such subsidiary of an amount sufficient to satisfy
such withholding requirements.

 

Article 23
- Governmental Regulations.

 

The
Company’s obligation to sell and deliver shares of Common Stock under the Plan
is subject to the approval of any governmental authority required in connection
with the authorization, issuance or sale of such shares.

 

Government
regulations may impose reporting or other obligations on the Company with
respect to the Plan.  For example, the
Company may be required to identify shares of Common Stock issued under the
Plan on its stock ownership records and send tax information statements to
employees and former employees who transfer title to such shares.

 

Article 24
- Governing Law.

 

The
validity and construction of the Plan shall be governed by the laws of
Delaware, without giving effect to the principles of conflicts of law thereof.

 

Article 25
- Approval of Board of Directors and Stockholders of the Company.

 

The
Plan was adopted by the Board of Directors on March 11, 2004 and was
approved by the stockholders of the Company on April 20, 2004.  The Plan was amended and restated by the
Board of Directors, without the need for stockholder approval, on August 2,
2004.  The Plan was amended and restated
by the Management Development and Compensation Committee of the Board of
Directors, without the need for stockholder approval, on August 31, 2004
and November 22, 2005.

 

Article 26
- Rules for Foreign Jurisdictions.

 

Notwithstanding
anything in the Plan to the contrary, the Company may, in its sole discretion,
amend or vary the terms of the Plan in order to conform such terms with the
requirements of each non-U.S. jurisdiction where a “participating subsidiary”
is located or to meet the goals and objectives of the Plan.  The Company may, where it deems appropriate
in its sole discretion, establish one or more sub-plans for these purposes. The
Company may also, in its sole discretion, establish administrative rules and
procedures to facilitate the operation of the Plan in such non-U.S.
jurisdictions.Exhibit 10.19

 

Phase
Forward Incorporated

 

Summary
of Cash Compensation Practices for Non-Employee Directors

(Effective January 1, 2006)

 

Annual retainer for Board
membership: $18,000

 

Audit and Finance
Committee

Annual retainer for
committee membership:  $12,000

Additional retainer for
committee chair:  $6,000

 

Management Development
and Compensation Committee

Annual retainer for
committee membership:  $7,000

Additional retainer for
committee chair:  $3,000

 

Governance, Nominating
and Compliance Committee

Annual retainer for
committee membership:  $7,000

Additional retainer for
committee chair:  $4,000

 

Annual retainer fees will
be paid quarterly in arrears.  All
directors are reimbursed for reasonable out-of-pocket expenses incurred in
attending meetings of the Board of Directors.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00099-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00099-of-00352.parquet"}]]