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Item 9A. Controls and Procedures

2021-02-17 compared with 2020-02-12 · 68 added, 59 removed, 84 unchanged (60% of the section changed)

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OTHER INFORMATION

On February 12, 2021, Pegasystems Inc.

(the “Company”) executed the Lease Termination Agreement with Charles Park Owner LLC to accelerate the lease termination date for the Company’s corporate headquarters in Cambridge, Massachusetts to October 1, 2021.

Under the terms of the Lease Termination Agreement, the Company will receive a payment of $18 million.

The Company is obligated to make rent payments outlined in the existing lease agreements until October 1, 2021, the new lease termination date.

The foregoing description of the Lease Termination Agreement does not purport to be complete and is qualified in its entirety by reference to the Lease Termination Agreement, a copy of which is attached as Exhibit 10.17 hereto.

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Except as set forth below, information required by this item is incorporated herein by reference from the information contained in our proxy statement for our 2021 annual stockholders meeting (the “2021 proxy statement”) under the headings Executive Compensation, Election of Directors, Corporate Governance, Executive Officers, and Delinquent Section 16(a) Reports, which will be filed with the Securities and Exchange Commission within 120 days after the close of the fiscal year.

We have adopted a written code of conduct that applies to our Board of Directors and all of our employees, including our principal executive officer, principal financial officer, principal accounting officer, and persons performing similar functions.

We have adopted a written code of conduct that applies to our Board of Directors and employees, including our principal executive officer, principal financial officer, principal accounting officer, and persons performing similar functions.

A copy of our code of conduct can be found on our website, www.pega.com.

We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K and under the applicable the NASDAQ Global Select Market rules by posting such information on our website in accordance with such requirements.

We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K and the applicable the NASDAQ Global Select Market rules by posting such information on our website in accordance with such requirements.

EXECUTIVE COMPENSATION

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The information required by this item is incorporated herein by reference from the information contained in the 2021 proxy statement under the headings “Certain Relationships and Related Transactions” and “Determination of Independence” and is incorporated herein by reference.

PRINCIPAL ACCOUNTING FEES AND SERVICES

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item is incorporated herein by reference from the information contained in the 2021 proxy statement under the heading “Independent Registered Public Accounting Firm Fees and Services” and is incorporated herein by reference.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) The following are filed as part of this Annual Report:

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Consolidated Statements of Cash Flows for the years ended December 31, 2020, 2019, and 2018

Agreement and Plan of Merger, dated as of October 9, 2013, by and among Pegasystems Inc., Aries Merger Sub, Inc., Antenna Software, Inc., and Shareholder Representative Services LLC, solely in its capacity as representative of Stockholders thereunder.

(Filed as Exhibit 2.1 to the Registrant’s October 11, 2013 Form 8-K and incorporated herein by reference.)

3.1 Restated Articles of Organization of the Registrant and Amendments thereto.

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3.2 Amended and Restated Bylaws of Pegasystems Inc.

(Filed as Exhibit 3.2 to the Registrant’s September 8, 2017 Form 8-K and incorporated herein by reference.)

(Filed as Exhibit 3.2 to the Registrant’s June 15, 2020 Form 8-K and incorporated herein by reference.)

4.1 Specimen Certificate Representing the Common Stock.

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333-03807) or an amendment thereto and incorporated herein by reference.)

Description of Common Stock

2004 Long-Term Incentive Plan (as amended and restated) (Filed as Exhibit 10.1 to the Registrant’s December 31, 2017 Form 10-K and incorporated herein by reference)

4.2 Indenture, dated as of February 24, 2020, between Pegasystems Inc.

Bank National Association, as trustee.

(Filed as Exhibit 4 .1 to the Registrant’s February 24 , 2020 Form 8-K and incorporated herein by reference)

4.3 Form of certificate representing the 0.75% Convertible Senior Notes due 2025 (included as Exhibit A to Exhibit 4.1 to the Registrant’s Form 8-K filed February 24 , 2020 and incorporated herein by reference)

4.4 Description of Common Stock ( Filed as Exhibit 4.2 to the Registrant ’ s 2019 Form 10-K and incorporated herein by reference ) .

10.1++ 2004 Long-Term Incentive Plan (as amended and restated) (Filed as Exhibit 10.1 to the Registrant’s June 2 4 , 2020 Form 8 -K and incorporated herein by reference)

10.2++ Restricted Stock Unit Sub-Plan of the Registrant’s 2004 Long-Term Incentive Plan for French Participants (Filed as Appendix B within the Registrant’s 2016 Proxy Statement, filed April 18, 2016 and incorporated herein by reference.)

+10.3++ 2006 Employee Stock Purchase Plan, as amended on October 29, 2020.

10.4++ Form of Employee Stock Option Agreement, as amended.

(Filed as Exhibit 10.3 to the Registrant’s March 31, 2017 Form 10-Q and incorporated herein by reference.)

+10.5++ Form of Global Stock Option Agreement

10.6++ Form of Restricted Stock Unit Agreement, as amended.

(Filed as Exhibit 10.4 to the Registrant’s March 31, 2017 Form 10-Q and incorporated herein by reference.)

+10.7++ Form of Global Restricted Stock Unit Agreement

10.8++ Form of Non-Employee Director Stock Option Agreement.

(Filed as Exhibit 10.2 to the Registrant’s September 30, 2004 Form 10-Q and incorporated herein by reference.)

Offer Letter between the Registrant and Douglas I.

Kra dated October 19, 2004.

(Filed as Exhibit 10.20 to the Registrant’s 2004 Form 10-K and incorporated herein by reference.)

10.9++ Form of Director Indemnification Agreement.

(Filed as Exhibit 99.1 to the Registrant’s April 11, 2005 Form 8-K and incorporated herein by reference.)

Lease Agreement dated June 29, 2011 between Charles Park One, LLC and Pegasystems Inc.

for premises at One Charles Park (Filed as Exhibit 99.1 to the Registrant’s Form 8-K/A filed on July 6, 2011 and incorporated herein by reference.)

2006 Employee Stock Purchase Plan, as amended on October 25, 2012.

10.10++ Offer Letter between the Registrant and Douglas I.

Kra dated October 19, 2004.

(Filed as Exhibit 10.20 to the Registrant’s 2004 Form 10-K and incorporated herein by reference.)

2016 Section 16 Officer/FLT Member Corporate Incentive Compensation Plan.

(Filed as Exhibit 99.1 to the Registrant’s February 24, 2016 Form 8-K and incorporated herein by reference.)

2016 Section 16 Executive Officers Base Salaries and Target Bonus Payments.

(Filed as Exhibit 99.1 to the Registrant’s March 15, 2016 Form 8-K and incorporated herein by reference.)

Compensation program for non-employee members of the Registrant’s Board of Directors.

(Filed as Exhibit 10.1 to the Registrant’s June 30, 2014 Form 10-Q and incorporated herein by reference.)

2017 Section 16 Officer/FLT Member Corporate Incentive Compensation Plan.

(Filed as Exhibit 99.1 to the Registrant’s March 8, 2017 Form 8-K and incorporated herein by reference.)

2015 Section 16 Executive Officers Base Salaries and Target Bonus Payments.

(Filed as Exhibit 99.2 to the Registrant’s February 3, 2015 Form 8-K and incorporated herein by reference.)

Compensation program for non-employee members of the Registrant’s Board of Directors, effective August 6, 2015.

(Filed as Exhibit 10.1 to the Registrant’s September 30, 2015 Form 10-Q and incorporated herein by reference.)

First Amendment to Lease Agreement dated November 11, 2014 between Charles Park One, LLC and Pegasystems Inc.

(Filed as Exhibit 10.2 to the Registrant’s September 30, 2015 Form 10-Q and incorporated herein by reference.)

10.11++ Offer Letter, dated April 27, 2020, between Pegasystems Inc.

and Hayden Stafford.

(Filed as Exhibit 10.

3 to the Registrant’s June 30, 2020 Form 10-Q and incorporated herein by reference )

10.12++ Offer Letter between the Registrant and Kenneth Stillwell dated June 1, 2016.

(Filed as Exhibit 99.1 to the Registrant’s June 14, 2016 Form 8-K and incorporated herein by reference.)

Compensation program for non-employee members of the Registrant’s Board of Directors, effective May 18, 2016.

(Filed as Exhibit 10.1 to the Registrant’s June 30, 2016 Form 10-Q and incorporated herein by reference.)

2018 Section 16 Officer/FLT Member Corporate Incentive Compensation Plan.

(Filed as Exhibit 99.1 to the Registrant’s December 27, 2017 Form 8-K and incorporated herein by reference.)

2018 Section 16 Officer/FLT Member Executive Officers Base Salaries and Target Bonus Payments.

(Filed as Exhibit 99.1 to the Registrant’s March 9, 2018 Form 8-K and incorporated herein by reference.)

2019 Section 16 Officer/FLT Member Corporate Incentive Compensation Plan.

(Filed as Exhibit 99.1 to the Registrant’s February 8, 2019 Form 8-K and incorporated herein by reference.)

Credit Agreement dated as of November 5, 2019 with PNC Bank, National Association (Filed as Exhibit 10.1 to the Registrant’s September 30, 2019 Form 10-Q and incorporated herein by reference.)

2019 Section 16 Officer/FLT Member Executive Officers Base Salaries and Target Bonus Payments.

(Filed as Exhibit 99.1 to the Registrant’s March 8, 2019 Form 8-K and incorporated herein by reference.)

10.13++ Compensation program for non-employee members of the Registrant’s Board of Directors, effective August 5, 2019 (Filed as Item 1.01 of the Registrant’s August 9, 2019 Form 8-K and incorporated herein by reference.)

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(Filed as Exhibit 99.1 to the Registrant’s February 7, 2020 Form 8-K and incorporated herein by reference.)

10.15 2020 Section 16 Officers/FLT Member Executive Officers Base Salaries and Target Bonus Payments (Filed as Exhibit 99.1 to the Registrant’s March 9, 2020 Form 8-K and incorporated herein by reference)

2021 Section 16 Officers/FLT Member Corporate Incentive Compensation Plan (Filed as Exhibit 99.1 to the Registrant’s February 8 , 2021 Form 8-K and incorporated herein by reference.

Lease Agreement dated June 29, 2011 between Charles Park One, LLC and Pegasystems Inc.

for premises at One Charles Park (Filed as Exhibit 99.1 to the Registrant’s Form 8-K/A filed on July 6, 2011 and incorporated herein by reference.)

First Amendment to Lease Agreement dated November 11, 2014 between Charles Park One, LLC and Pegasystems Inc.

(Filed as Exhibit 10.2 to the Registrant’s September 30, 2015 Form 10-Q and incorporated herein by reference.)

+10.18 Lease Termination Agreement, dated February 12, 2021, between Charles Park One, LLC and Pegasystems Inc.

Credit Agreement dated as of November 5, 2019 with PNC Bank, National Association (Filed as Exhibit 10.1 to the Registrant’s September 30, 2019 Form 10-Q and incorporated herein by reference.)

10.20 Amendment to Loan Documents, dated February 18, 2020, between Pegasystems Inc.

and PNC Bank, National Association.

(Filed as Exhibit 10 .

3 to the Registrant’s Form 8-K filed February 24 , 2020 and incorporated herein by reference)

10.21 Amendment 2 to Loan Documents, dated July 22, 2020, between Pegasystems Inc.

and PNC Bank, National Association.

(Filed as Exhibit 10.

2 to the Registrant’s June 30, 20 20 Form 10-Q and incorporated herein by reference.)

10.22 Amendment to Loan Documents, dated as of September 30, 2020, between Pegasystems Inc.

and PNC Bank, National Association (Filed as Exhibit 10.

3 to the Registrant’s September 30, 2020 Form 10-Q and incorporated herein by reference.)

10.23 Form of Side Letter to Base Call Option Transaction (Filed as Exhibit 10 .1 to the Registrant’s September 30, 2014 Form 10-Q and incorporated herein by reference.)

10.24 Form of Side Letter to Additional Call Option Transaction (Filed as Exhibit 10 .

2 to the Registrant’s September 30, 20 20 Form 10-Q and incorporated herein by reference.)

10.25 Form of Confirmation of Base Call Option Transaction.

(Filed as Exhibit 10 .1 to the Registrant’s Form 8-K filed February 24 , 2020 and incorporated herein by reference)

10.26 Form of Confirmation of Additional Call Option Transaction.

(Filed as Exhibit 10 .

2 to the Registrant’s Form 8-K filed February 24, 2020 and incorporated herein by reference)

+21.1 Subsidiaries of the Registrant.

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Section 1350 of the Chief Executive Officer and the Chief Financial Officer.

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104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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Pegasystems Inc.

February 12, 2020

February 17, 2021 By:

/s/ KENNETH STILLWELL

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Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below on February 17, 2021 by the following persons on behalf of the Registrant and in the capacities indicated.

Signature Title

/s/ ALAN TREFLER

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(Principal Executive Officer)

/s/ KENNETH STILLWELL

Chief Financial Officer and Chief Administrative Officer

/s/ KENNETH STILLWELL Chief Financial Officer and Chief Administrative Officer

(Principal Financial Officer)

Kenneth Stillwell

/s/ EFSTATHIOS KOUNINIS

Chief Accounting Officer, Vice President of Finance and Treasurer

/s/ EFSTATHIOS KOUNINIS Chief Accounting Officer, Vice President of Finance, and Treasurer

(Principal Accounting Officer)

Efstathios Kouninis

/s/ PETER GYENES

/s/ RONALD HOVSEPIAN

/s/ PETER GYENES Director

/s/ RONALD HOVSEPIAN Director

Ronald Hovsepian

/s/ RICHARD JONES

/s/ RICHARD JONES Director

Richard Jones

/s/ CHRISTOPHER LAFOND

/s/ CHRISTOPHER LAFOND Director

Christopher Lafond

/s/ DIANNE LEDINGHAM

/s/ DIANNE LEDINGHAM Director

Dianne Ledingham

/s/ JAMES O’HALLORAN

James O’Halloran

/s/ SHARON ROWLANDS

/s/ SHARON ROWLANDS Director

Sharon Rowlands

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures