SAPIENT CORP, DEF 14A, 2000-04-28

SAPIENT CORP
DEF 14A, 2000-04-28
COMPUTER INTEGRATED SYSTEMS DESIGN

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<PAGE> 1

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934

FILED BY THE REGISTRANT [X] FILED BY A PARTY OTHER THAN THE REGISTRANT [ ]

- --------------------------------------------------------------------------------

Check the appropriate box:

[ ] Preliminary Proxy Statement

[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))

SAPIENT CORPORATION
(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of securities to which transaction applies:

2) Aggregate number of securities to which transaction applies:

3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act
Rule 0-11 (Set forth the amount on which the filing fee is calculated and
state how it was determined):

4) Proposed maximum aggregate value of transaction:

5) Total fee paid:

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

2) Form, Schedule or Registration Statement No.:

3) Filing Party:

4) Date Filed:

- --------------------------------------------------------------------------------
<PAGE> 2

SAPIENT CORPORATION

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD MAY 24, 2000

NOTICE IS HEREBY GIVEN that the Annual Meeting of the Stockholders of
Sapient Corporation, a Delaware corporation (the "Company"), will be held on
Wednesday, May 24, 2000, at 9:00 a.m., at the offices of the Company, One
Memorial Drive, Cambridge, Massachusetts (the "Meeting") for the purpose of
considering and voting upon the following matters:

1. To elect two Class I Directors for the ensuing three years;

2. To approve an amendment to the Company's Amended and Restated
Certificate of Incorporation increasing the number of authorized shares
of Common Stock from 100,000,000 to 200,000,000; and

3. To transact such other business as may properly come before the Meeting
or any adjournment thereof.

The Board of Directors has no knowledge of any other business to be
transacted at the Meeting.

The Board of Directors has fixed the close of business on Thursday, March
30, 2000 as the record date for the determination of stockholders entitled to
notice of and to vote at the Meeting and at any adjournments thereof.

A copy of the Company's Annual Report to Stockholders for the year ended
December 31, 1999, which contains consolidated financial statements and other
information of interest to stockholders, accompanies this Notice and the
enclosed Proxy Statement.

By order of the Board of Directors,

JERRY A. GREENBERG
Secretary

May 5, 2000

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE PROMPTLY COMPLETE,
DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. NO
POSTAGE NEED BE AFFIXED IF THE PROXY IS MAILED IN THE UNITED STATES.
<PAGE> 3

SAPIENT CORPORATION
ONE MEMORIAL DRIVE
CAMBRIDGE, MASSACHUSETTS 02142

PROXY STATEMENT

FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 24, 2000

This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Sapient Corporation (the "Company") for use
at the Annual Meeting of Stockholders to be held on Wednesday, May 24, 2000, at
9:00 a.m., at the offices of the Company, One Memorial Drive, Cambridge,
Massachusetts, and at any adjournments thereof (the "Meeting").

All proxies will be voted in accordance with the instructions of the
stockholder. If no choice is specified, the proxies will be voted in favor of
the matters set forth in the accompanying Notice of Meeting. Any proxy may be
revoked by a stockholder at any time before its exercise by delivery of a
written revocation to the Secretary of the Company. Attendance at the Meeting
will not itself be deemed to revoke a proxy unless the stockholder gives
affirmative notice at the Meeting that the stockholder intends to revoke the
proxy and vote in person.

At the close of business on March 30, 2000, the record date for the
determination of stockholders entitled to vote at the Meeting, there were
outstanding and entitled to vote an aggregate of 58,390,239 shares of Common
Stock of the Company, $.01 par value per share (the "Common Stock"). Each share
entitles the record holder to one vote on each of the matters to be voted upon
at the Meeting.

All of the share numbers contained in this Proxy Statement reflect a
two-for-one stock split effected as a 100% stock dividend on November 5, 1999 to
stockholders of record on November 1, 1999.

THE NOTICE OF MEETING, THIS PROXY STATEMENT, THE ENCLOSED PROXY AND THE
COMPANY'S ANNUAL REPORT TO STOCKHOLDERS FOR THE YEAR ENDED DECEMBER 31, 1999 ARE
BEING MAILED TO STOCKHOLDERS ON OR ABOUT MAY 5, 2000. THE COMPANY WILL, UPON
WRITTEN REQUEST OF ANY STOCKHOLDER, FURNISH WITHOUT CHARGE A COPY OF ITS ANNUAL
REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1999, AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, WITHOUT EXHIBITS. PLEASE ADDRESS ALL SUCH
REQUESTS TO THE COMPANY, ATTENTION: INVESTOR RELATIONS, ONE MEMORIAL DRIVE,
CAMBRIDGE, MASSACHUSETTS 02142. EXHIBITS WILL BE PROVIDED UPON WRITTEN REQUEST
AND PAYMENT OF AN APPROPRIATE PROCESSING FEE.

VOTES REQUIRED

The holders of a majority of the shares of Common Stock issued and
outstanding and entitled to vote at the Meeting shall constitute a quorum for
the transaction of business at the Meeting. Shares of Common Stock present in
person or represented by proxy (including shares which abstain or do not vote
with respect to one or more of the matters presented for stockholder approval)
will be counted for purposes of determining whether a quorum exists at the
Meeting.

The affirmative vote of the holders of a plurality of the shares of Common
Stock voting on the matter is required for the election of directors. The
affirmative vote of the holders of a majority of the outstanding shares of
Common Stock is required to approve the proposed amendment to the Company's
Amended and Restated Certificate of Incorporation.

Shares which abstain from voting as to a particular matter, and shares held
in "street name" by brokers or nominees who indicate on their proxies that they
do not have discretionary authority to vote such shares as to a particular
matter, will not be voted in favor of such matter, and will also not be counted
as shares voting on
<PAGE> 4

such matter. Accordingly, abstentions and "broker non-votes" will have no effect
on the voting on a matter that requires the affirmative vote of a plurality or a
majority of the shares voting on a matter. However, because shares which abstain
and shares represented by broker non-votes are nonetheless considered
outstanding shares, abstentions and broker non-votes with respect to the
proposed amendment to the Company's Amended and Restated Certificate of
Incorporation will have the same effect as a vote against such proposed
amendment.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information as of March 1, 2000 with
respect to the beneficial ownership of shares of Common Stock by (i) each person
known to the Company to own beneficially more than 5% of the outstanding shares
of Common Stock, (ii) each director and nominee for director of the Company,
(iii) Messrs. Greenberg and Moore, the Co-Chief Executive Officers of the
Company, and the four other executive officers listed in the Summary
Compensation Table set forth under the caption "Compensation of Executive
Officers" below (the "Named Executive Officers"), and (iv) the directors and
executive officers of the Company as a group.

<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP(1)
--------------------------------
PERCENT OF
BENEFICIAL OWNER NUMBER OF SHARES CLASS
---------------- ---------------- ----------
<S> <C> <C>
5% STOCKHOLDERS
Jerry A. Greenberg.......................................... 10,451,603(2) 18.0%
Co-Chief Executive Officer
c/o Sapient Corporation
One Memorial Drive
Cambridge, Massachusetts 02142
J. Stuart Moore............................................. 10,245,657(3) 17.7%
Co-Chief Executive Officer
c/o Sapient Corporation
One Memorial Drive
Cambridge, Massachusetts 02142
Janus Capital Corporation................................... 4,358,065(4) 7.5%
100 Fillmore Street
Denver, Colorado 80206
Putnam Investments, Inc..................................... 4,350,500(5) 7.5%
One Post Office Square
Boston, Massachusetts 02109
OTHER DIRECTORS
R. Stephen Cheheyl.......................................... 27,000 *
Darius W. Gaskins, Jr. ..................................... 30,400 *
Carl S. Sloane.............................................. 13,200 *
OTHER NAMED EXECUTIVE OFFICERS
Sheeroy D. Desai............................................ 762,316 1.3%
Susan D. Johnson............................................ 84,626 *
Desmond P. Varady........................................... 192,082 *
Bruce D. Parker............................................. 30,200 *
All executive officers and directors, as a group (11
persons).................................................. 21,837,534 37.3%
</TABLE>

- ---------------
* Less than 1%

(1) Each stockholder possesses sole voting and investment power with respect to
the shares listed, except as otherwise noted. Includes the following number
of shares issuable within the 60-day period following March 1, 2000 pursuant
to the exercise of options: Mr. Cheheyl (25,000); Mr. Gaskins (25,000);

2
<PAGE> 5

Mr. Sloane (8,000); Mr. Desai (224,700); Ms. Johnson (64,340); Mr. Varady
(67,602); Mr. Parker (25,000); and all executive officers and directors as a
group (439,642). As of March 1, 2000, there were 57,982,184 shares of Common
Stock outstanding.

(2) Includes 332,388 shares held by the Jerry A. Greenberg Remainder Trust-1996,
3,175,243 shares held by the Jerry A. Greenberg Eight-Year Qualified Annuity
Trust-1996, 764,294 shares held by the Jerry A. Greenberg Three-Year
Qualified Annuity Trust-1997, and 305,576 shares held by the Jerry A.
Greenberg Charitable Lead Annuity Trust-2000, of which trusts Mr. Greenberg
is a co-trustee and over which shares Mr. Greenberg shares voting and/or
investment control.

(3) Includes (i) 3,680,496 shares held by the J. Stuart Moore Eight-Year
Qualified Annuity Trust-1996, of which Mr. Moore is the sole trustee and
over which Mr. Moore has sole voting and investment control, (ii) 575,036
shares held by the J. Stuart Moore Two-Year Qualified Annuity Trust-1998 and
755,154 shares held by the J. Stuart Moore Remainder Trust, of which trusts
Mr. Moore is a co-trustee and over which shares Mr. Moore shares investment
control, (iii) 31,138 shares held by the J. Stuart Moore Irrevocable Trust,
of which Mr. Moore's wife is a co-trustee and over which shares Mr. Moore's
wife shares voting and investment control and (iv) 537,455 shares held by
the J. Stuart Moore Gift Trust of 1995, over which shares Mr. Moore does not
have voting or investment control but in which shares Mr. Moore's children
have a beneficial interest. Mr. Moore disclaims beneficial ownership of the
shares held by the trusts except to the extent of his proportionate
pecuniary interest therein.

(4) The information reported is based on a Schedule 13G/A, dated February 15,
2000, filed with the Securities and Exchange Commission by each of Janus
Capital Corporation ("Janus") and Thomas H. Bailey. Janus is a registered
investment advisor, in which capacity it has shared voting power over
4,358,065 shares and shared dispositive power over 4,358,065 shares. Mr.
Bailey is President and Chairman of the Board of Directors of Janus. In
addition, Mr. Bailey owns approximately 12.2% of the outstanding stock of
Janus.

(5) The information reported is based on a Schedule 13G, dated February 18,
2000, filed with the Securities and Exchange Commission by Putnam
Investments, Inc. ("Putnam") and two of its subsidiaries, Putnam Investment
Management, Inc. ("PIM") and The Putnam Advisory Company, Inc. ("PAC"). PIM
and PAC are registered investment advisors, in which capacity they
collectively have shared voting power over 46,600 shares and dispositive
power over 4,350,500 shares.

3
<PAGE> 6

PROPOSAL 1 -- ELECTION OF DIRECTORS

The Company's Board of Directors is divided into three classes, with
members of each class holding office for staggered three-year terms. There are
currently two Class I directors, whose terms expire at this Meeting, two Class
II directors, whose terms expire in 2001, and two Class III directors, whose
terms expire in 2002 (in all cases subject to the election and qualification of
their successors or their earlier death, resignation or removal).

The persons named in the enclosed proxy will vote each proxy for the
election of Jerry A. Greenberg and Bruce D. Parker as Class I directors, unless
authority to vote for the election of either or both of the nominees is withheld
by marking the proxy to that effect. Messrs. Greenberg and Parker are both
currently directors of the Company.

Each Class I director will be elected to hold office until the Company's
annual meeting of stockholders to be held in 2003 and until his successor is
elected and qualified. Each of the nominees has indicated his willingness to
serve, if elected; however, if either nominee should be unable or unwilling to
stand for election, the person acting under the proxy may vote the proxy for a
substitute nominee designated by the Board of Directors. The Board of Directors
has no reason to believe that either of the nominees will be unable to serve if
elected.

All of the Company's directors are listed below with their principal
occupation and business experience for the past five years, the names of other
publicly held companies of which they serve as a director, age and length of
service as a director of the Company.

<TABLE>
<CAPTION>
Principal Occupation, Other Business
Director Experience during Past Five Years and
Name Age Since Other Directorships
---- --- -------- -------------------------------------
<S> <C> <C> <C>
NOMINEES FOR TERMS EXPIRING IN 2003 (CLASS I DIRECTORS)
Jerry A. Greenberg....... 34 1991 Mr. Greenberg co-founded the Company in 1991 and has
served as Co-Chairman of the Board of Directors and
Co-Chief Executive Officer of the Company since its
inception.
Bruce D. Parker.......... 52 1995 Mr. Parker joined the Company in December 1999 as an
Executive Vice President. Mr. Parker has been a
director of the Company since September 1995. Mr.
Parker served as Senior Vice President and Chief
Information Officer at United Airlines, Inc. from
December 1997 until December 1999. From September
1994 to December 1997, Mr. Parker was Senior Vice
President-Management Information Systems and Chief
Information Officer at Ryder System Inc., a
transportation company.
DIRECTORS WHOSE TERMS EXPIRE IN 2001 (CLASS II DIRECTORS)
Darius W. Gaskins,
Jr. ................... 60 1995 Mr. Gaskins has been a director of the Company since
September 1995. Mr. Gaskins is a founding partner of
Norbridge, Inc., formerly Carlisle, Fagan, Gaskins &
Wise, Inc., a management consulting firm. Since 1991,
Mr. Gaskins has also been a partner of High Street
Associates, Inc., which owns and manages a specialty
chemical company. Mr. Gaskins is also a director of
Anacomp Inc., Northwestern Steel and Wire Company and
RH Donnelley Corporation.
J. Stuart Moore.......... 38 1991 Mr. Moore co-founded the Company in 1991 and has
served as Co-Chairman of the Board of Directors and
Co-Chief Executive Officer of the Company since its
inception.
</TABLE>

4
<PAGE> 7

For information relating to shares of Common Stock owned by each of the
directors, see "Security Ownership of Certain Beneficial Owners and Management."

BOARD AND COMMITTEE MEETINGS

The Board of Directors met eight times (including by telephone conference)
during 1999. All directors attended at least 75% of the meetings of the Board of
Directors and of the committees on which they served.

The Company has a standing Audit Committee, which is responsible for
reviewing the results and scope of the audit and other services provided by the
Company's independent public accountants. The Audit Committee held four meetings
during 1999. The Audit Committee is currently comprised of Messrs. Cheheyl and
Gaskins, each a non-employee director.

The Company has a standing Compensation Committee, which is responsible for
reviewing the Company's overall compensation policies and approving the
compensation of the Company's executive officers. The Compensation Committee
held three meetings in 1999. The current members of the Compensation Committee
are Messrs. Gaskins and Sloane, each a non-employee director.

DIRECTOR COMPENSATION

Each non-employee director is paid $3,000 for attendance in person at each
Board meeting and $750 for attendance in person at any committee meeting that is
not held on the same day as a Board meeting. If a director participates by
telephone, rather than in person, one-half of such amount is paid. In addition,
each non-employee director is reimbursed for expenses incurred in connection
with attending meetings. Directors receive no other cash compensation for
serving as directors.

On June 15, 1999, each of the Company's four non-employee directors was
granted a stock option under the Company's 1998 Stock Incentive Plan to acquire
2,000 shares of Common Stock at an exercise price of $34.00 per share, which the
Board determined to be the fair market value of the Common Stock on such date.
Such options vest in four equal annual installments starting on the first
anniversary of the date of grant.

5
<PAGE> 8

In February 1996, the Board adopted and the stockholders approved the 1996
Director Stock Option Plan (the "Director Plan"), pursuant to which each new
non-employee director elected to the Board of Directors in the future will be
granted, upon his or her initial election as a director, an option to purchase
20,000 shares of Common Stock. All options granted under the Director Plan will
have an exercise price equal to the fair market value of the Common Stock on the
date of grant, will vest over a four year period, provided the optionholder
continues to serve as a director of the Company, and will expire ten years from
the date of grant (subject to earlier termination in the event the optionee
ceases to serve as a director of the Company). No options have ever been granted
under the Director Plan, which provides for the issuance of a maximum of 120,000
shares.

COMPENSATION OF EXECUTIVE OFFICERS

SUMMARY COMPENSATION TABLE

The following table sets forth certain information with respect to the
compensation paid in each of the last three fiscal years to the Named Executive
Officers.

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
-------------
NUMBER OF
SHARES
ANNUAL COMPENSATION(1) UNDERLYING ALL OTHER
NAME AND ----------------------- STOCK COMPENSATION
PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS(#)(2) (3)
------------------ ---- ---------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Jerry A. Greenberg................. 1999 $ 50,000 $ 0 0 $ 898
Co-Chairman of the Board and 1998 50,000 69,693 0 1,250
Co-Chief Executive Officer 1997 50,000 107,396 0 470
J. Stuart Moore.................... 1999 $ 50,000 $ 0 0 $ 938
Co-Chairman of the Board and 1998 50,000 69,693 0 1,250
Co-Chief Executive Officer 1997 50,000 107,396 0 1,250
Sheeroy D. Desai(4)................ 1999 $ 50,000 $ 0 0 $1,250
Executive Vice President and 1998 100,000 41,375 50,000 1,250
Co-Chief Operating Officer 1997 50,000 109,650 0 1,172
Susan D. Johnson(4)(5)............. 1999 $100,000 $ 0 0 $1,250
Senior Vice President 1998 100,000 70,800 10,000 1,250
1997 60,000 67,750 40,000 1,250
Desmond Varady(4).................. 1999 $ 75,000 $ 0 65,000 $1,250
Executive Vice President and 1998 100,000 111,719 10,500 1,250
Co-Chief Operating Officer
Bruce D. Parker(6)................. 1999 $ 12,500 $450,000 77,000 $ 0
Executive Vice President
</TABLE>

- ---------------
(1) In accordance with the rules of the Securities and Exchange Commission,
other compensation in the form of perquisites and other personal benefits
has been omitted because such perquisites and other personal benefits
constituted less than the lesser of $50,000 or ten percent of the total
annual salary and bonus for the Named Executive Officer for such year.

(2) The Company has never granted any stock appreciation rights.

(3) Amounts shown in this column represent the Company's matching contributions
under the Company's 401(k) Plan.

(4) Each of Messrs. Desai and Varady and Ms. Johnson were awarded a bonus in
1999 but elected to receive such bonus in the form of future grants of stock
options.

6
<PAGE> 9

(5) Ms. Johnson served as the Chief Financial Officer and Treasurer of the
Company from February 1994 through January 3, 2000. Ms. Johnson resigned as
the Chief Financial Officer and was appointed a Senior Vice President of the
Company on January 3, 2000.

(6) Mr. Parker, who has served as a member of the Company's Board of Directors
since 1995, joined the Company as an Executive Vice President on December
20, 1999. The $450,000 paid by the Company to Mr. Parker in 1999 reflects a
signing bonus paid to Mr. Parker in connection with his employment. The
Number of Shares Underlying Stock Options includes an option to purchase
2,000 shares of the Company's common stock granted to Mr. Parker in June
1999 in connection with his service as a member of the Company's Board of
Directors. See "Option Grants in Last Fiscal Year."

Each Named Executive Officer has executed agreements which prohibit them
from competing with the Company for a period of 12 months following termination
of their employment with the Company.

OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth certain information regarding options
granted during the fiscal year ended December 31, 1999 by the Company to the
Named Executive Officers.

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
------------------------------------------------
PERCENT OF
NUMBER OF TOTAL POTENTIAL REALIZABLE VALUE AT
SECURITIES OPTIONS ASSUMED ANNUAL RATES OF STOCK
UNDERLYING GRANTED TO EXERCISE PRICE APPRECIATION FOR OPTION
OPTIONS EMPLOYEES OR BASE TERM(3)
GRANTED IN FISCAL PRICE EXPIRATION -----------------------------
NAME (#)(1) YEAR ($/SH)(2) DATE 5% 10%
---- ---------- ---------- --------- ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Jerry A. Greenberg(4)... -- -- -- -- -- --
J. Stuart Moore(4)...... -- -- -- -- -- --
Sheeroy D. Desai........ 0 0 0 0 0 0
Susan D. Johnson........ 0 0 0 0 0 0
Desmond Varady.......... 65,000 .01% $ 25.81 07/22/09 $ 2,732,715 $ 4,351,392
Bruce D. Parker......... 2,000 * $ 34.00 06/15/09 $ 110,765 $ 176,374
75,000 .02% $113.00 12/20/09 $13,804,880 $21,981,965
</TABLE>

- ---------------
* Less than .01%

(1) Represents options granted pursuant to the Company's 1998 Stock Incentive
Plan. 5,000 of the options granted to Mr. Varady became exercisable
immediately. The remaining 60,000 options granted to Mr. Varady become
exercisable in five equal annual installments commencing on the first
anniversary of the first day of the month following the date of grant. All
of the options granted to Mr. Parker become exercisable in four equal annual
installments commencing on the first anniversary of the first day of the
month following the date of grant.

(2) The exercise price is equal to the fair market value of the Company's Common
Stock on the date of grant.

(3) Potential realizable value is based on an assumption that the market price
of the stock will appreciate at the stated rate, compounded annually, from
the date of grant until the end of the 10-year term. These values are
calculated based on rules promulgated by the Securities and Exchange
Commission and do not reflect the Company's estimate or projection of future
stock prices. Actual gains, if any, on stock option

7
<PAGE> 10

exercises will depend on the future performance of the Company's Common
Stock, the optionholder's continued employment through the option period and
the date on which the options are exercised.

(4) Messrs. Greenberg and Moore do not participate in the Company's stock plans.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

The following table summarizes, for each of the Named Executive Officers,
the number of shares acquired on exercise of options during the fiscal year
ended December 31, 1999, the aggregate dollar value realized upon such exercise
and the number and value of unexercised options held by such officers on
December 31, 1999.

<TABLE>
<CAPTION>
NUMBER OF SHARES
UNDERLYING
UNEXERCISED VALUE OF UNEXERCISED
NUMBER OF OPTIONS IN-THE-MONEY OPTIONS
SHARES VALUE AT FISCAL YEAR-END AT FISCAL YEAR-END
ACQUIRED ON REALIZED EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) (1) UNEXERCISABLE(#) UNEXERCISABLE(2)
---- ----------- ---------- ------------------ -----------------------
<S> <C> <C> <C> <C> <C> <C>
Jerry A. Greenberg(3)........... -- -- -- / -- -- / --
J. Stuart Moore(3).............. -- -- -- / -- -- / --
Sheeroy D. Desai................ 10,000 $ 257,655 224,700/ 187,300 $31,322,354/ 24,952,616
Susan D. Johnson................ 19,600 $ 530,950 41,000/ 97,000 $ 5,466,636/ 12,519,999
Desmond Varady.................. 56,400 $1,218,189 75,402/ 151,798 $10,362,787/ 18,684,475
Bruce D. Parker................. 0 $ 0 20,000/ 89,000 $ 2,714,000/ 3,875,688
</TABLE>

- ---------------
(1) Represents the difference between the exercise price and the fair market
value of the Common Stock on the date of exercise.

(2) Represents the difference between the last reported sale price per share
($140.9375) of the Common Stock on December 31, 1999, as reported on the
Nasdaq National Market, and the exercise price.

(3) Messrs. Greenberg and Moore do not participate in the Company's stock plans.

EMPLOYMENT AGREEMENTS AND CHANGE OF CONTROL ARRANGEMENTS

In December 1999, the Company entered into an agreement with Mr. Parker in
connection with his employment by the Company. The agreement provides for the
acceleration of certain options held by Mr. Parker and certain payments to be
made by the Company to Mr. Parker in the event of a change in control of Sapient
or termination of Mr. Parker's employment without cause. In the event of certain
unsolicited changes in control of the Company, (i) all outstanding stock options
held by Mr. Parker would vest immediately, and (ii) the Company would pay Mr.
Parker a cash amount equal to three times his then annual base salary and target
bonus. In the event of certain solicited changes in control of the Company, the
vesting of Mr. Parker's stock options would accelerate by twenty-four months.
For twenty-four months following a change in control of the Company, if Mr.
Parker's employment is terminated without cause or if he resigns for certain
stated reasons, (i) all outstanding stock options held by Mr. Parker would
immediately vest, and (ii) the Company would pay Mr. Parker a cash amount equal
to two times his then annual base salary and target bonus. Absent a change of
control, if the Company terminates Mr. Parker's employment without cause, then
the vesting of Mr. Parker's stock options would accelerate by twenty-four
months, and if Mr. Greenberg was then the co-Chief Executive Officer of the
Company, the Company would pay Mr. Parker a cash amount equal to one times his
then annual base salary and target bonus, but if Mr. Greenberg was not then the
co-Chief Executive Officer of the Company, the Company would pay Mr. Parker a
cash amount equal to two times his then annual base salary and target bonus. Mr.
Parker has also entered into a Non-Disclosure, Non-

8
<PAGE> 11

Solicitation and Non-Compete Agreement with the Company which, among other
things, prohibits Mr. Parker from soliciting the Company's employees or clients
following his employment termination or working for any competitor of the
Company for stated periods of time. Mr. Parker would not receive any cash
payments or option acceleration as described above if he violates his
Non-Disclosure, Non-Solicitation and Non-Compete Agreement. All stock options
held by Mr. Parker immediately vest upon his retirement.

REPORT ON EXECUTIVE COMPENSATION

The Compensation Committee of the Board of Directors is responsible for
reviewing the Company's overall compensation policies and, with the input of the
Company's Co-Chief Executive Officers, setting the compensation of the Company's
executive officers. Until December 1999 when Mr. Parker was appointed as an
Executive Vice President of the Company, the Compensation Committee was
comprised solely of two non-employee directors, Messrs. Parker and Sloane. When
Mr. Parker joined the Company as an employee, he resigned as a member of the
Compensation Committee and Mr. Gaskins, a non-employee director, was elected to
the Compensation Committee to fill the vacancy.

Compensation Philosophies and Goals

The Company's executive compensation program for 1999, which consisted of a
combination of base salary, cash bonuses and stock options, was designed in
large part to align executive incentives with the Company's strategic goals.
Accordingly, a significant portion of the total cash compensation of the
Company's senior executives was directly linked to the Company's and the
executive's satisfaction of specified goals. By tying compensation to the
achievement of the Company's core objectives and fundamental values, the Company
believes that a performance-oriented environment is created for its executives
and other employees.

The Company's executive compensation program for 1999 was also intended to
align executive and shareholder interests by providing executives with an equity
interest in the Company through the granting of stock options. Consistent with
this purpose, because Messrs. Greenberg and Moore, the Company's founders, each
already holds a significant equity stake in the Company, they do not participate
in the Company's stock option plans. The size of option grants was recommended
by the Co-Chief Executive Officers to the Compensation Committee for approval.
The Compensation Committee based its review of such recommended grants on
various factors, including the executive's responsibilities, the executive's
past, present and expected contributions to the Company and the executive's
current stock and option holdings.

In addition to structuring its executive compensation program in a manner
which will reward executives for the achievement of the Company's business
objectives as well as for individual performance, the Company also seeks to
attract and retain key executives through its compensation program.

Compensation in Fiscal 1999

Cash Compensation

In keeping with the Company's desire to create a performance-oriented
environment through its compensation programs, the bonus component is a
significant percentage of the overall cash compensation payable to the Company's
executive officers. Base salaries of the executive officers for 1999 were
determined by the Compensation Committee.

The Company adopted an executive bonus plan for 1999 which covered the
executive officers and other senior management of the Company. Under the bonus
plan, the Co-Chief Executive Officers recommended to the Compensation Committee
for approval the target amount of bonus compensation payable to each participant
for the year. Each participant's actual bonus compensation was determined based
on the achievement of specified goals in four key measurement areas: client
project satisfaction, employee retention

9
<PAGE> 12

and financial performance as measured by revenue, and operating margin. The
weighting of each of the four measurements varied for each participant,
depending on his or her role in the Company. Also, depending on a participant's
role in the Company, the achievement of certain goals was measured on a
Company-wide, business unit or individual office basis. All executive officers
were measured on a Company-wide basis. Each participant's actual bonus
compensation was then determined based on the following factors:

- Client Project Satisfaction. Depending on a participant's role in the
Company, zero to 40 percent of each participant's bonus compensation was
based on a weighted average of the Company's measurements of client
satisfaction, which are collected by the Company in writing throughout
the year in connection with each client project. Also depending on a
participant's role in the Company, the client satisfaction ratings used
to calculate a participant's bonus compensation were based on ratings
from clients of the individual participant or on a business unit or
Company-wide basis.

- Employee Retention. Depending on a participant's role in the Company,
zero to 50 percent of a participant's bonus compensation was based on the
achievement of organization goals relating to the retention of employees.
Also depending on a participant's role in the Company, the satisfaction
of this goal was measured on an individual office, business unit or
Company-wide basis.

- Revenue. Depending on a participant's role in the Company, zero to 60
percent of a participant's bonus compensation was based on the
achievement of specified revenue goals. Also depending on a participant's
role in the Company, the achievement of revenue targets was measured on a
Company-wide, business unit, individual office or individual participant
basis.

- Operating Margin. Depending on a participant's role in the Company, 10
to 30 percent of a participant's bonus compensation was based on the
Company's satisfaction of operating margin targets established by the
Company.

Messrs. Greenberg and Moore recommended to the Compensation Committee that
a certain percentage of the full target bonus be paid to each of the executive
officers, other than themselves, based upon the partial achievement of the
Company-wide targets. Messrs. Greenberg and Moore recommended that no bonus
payments be made to themselves because the Company had not achieved 100% of the
targets. In February 2000, the Compensation Committee reviewed the
recommendations made by Messrs. Greenberg and Moore and the Company's
performance against the factors described above. Based upon this review, the
Compensation Committee approved the recommended bonus payments to each executive
officer other than Messrs. Greenberg and Moore.

Incentive Compensation

During 1999, the Named Executive Officers received options to purchase an
aggregate of 142,000 shares of Common Stock at a weighted average exercise price
of $71.98 per share, as indicated in the Option Grants in Last Fiscal Year
table. Other than the 2,000 share option grant to Mr. Parker in June 1999 for
his participation as a Board member, the timing and size of option grants were
recommended by the Co-Chief Executive Officers to the Compensation Committee for
approval.

Compliance with Internal Revenue Code Section 162(m)

Section 162(m) of the Internal Revenue Code of 1986, as amended, generally
disallows a federal income tax deduction to public companies for certain
compensation in excess of $1 million paid to a corporation's chief executive
officer or any of its four other most highly compensated executive officers.
Qualifying performance-based compensation will not be subject to the deduction
limit if certain requirements are met. The Company has structured its stock
incentive plans to qualify income received upon the exercise of stock

10
<PAGE> 13

options granted under those plans as performance-based compensation. The
Compensation Committee intends to review the potential effects of Section 162(m)
periodically and in the future may decide to structure additional portions of
the Company's compensation program in a manner designed to permit unlimited
deductibility for federal income tax purposes.

Darius W. Gaskins, Jr.
Bruce D. Parker
Carl S. Sloane

COMPARATIVE STOCK PERFORMANCE

The following graph compares the cumulative total stockholder return on the
Common Stock of the Company from April 3, 1996 (the date the Common Stock of the
Company was registered under the Securities Exchange Act of 1934, as amended)
through December 31, 1999 with the cumulative total return on (i) the Nasdaq
Composite Index and (ii) the Goldman Sachs Technology Index -- Computer Services
Index. The comparison assumes the investment of $100 on April 3, 1996 in the
Company's Common Stock and in each of the indices and, in each case, assumes
reinvestment of all dividends.

<TABLE>
<CAPTION>
GSTI COMPUTER SERVICES
SAPIENT CORPORATION NASDAQ COMPOSITE INDEX INDEX
------------------- ---------------------- ----------------------
<S> <C> <C> <C>
4/3/96 100.00 100.00 100.00
12/31/96 131.60 115.70 102.40
12/31/97 191.40 140.40 117.20
12/31/98 350.00 196.10 146.10
12/31/99 1761.70 363.90 183.20
</TABLE>

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During 1999, the Company performed services for HealthWatch Technologies,
LLC ("HealthWatch"). HealthWatch was created by the Company and others in 1998
for the purpose of performing Medicaid fraud, abuse and overpayment detection
and collection services to state governments, including one state government
that had awarded a service contract to the Company to perform such services.
HealthWatch was created after

11
<PAGE> 14

the Company's Board of Directors determined that it would not be in the
Company's best interest to directly provide such detection and collection
services. The Company owns approximately 44% of the outstanding limited
liability company interests of HealthWatch, and certain affiliates of the
Company own approximately 12% of the outstanding limited liability company
interests of HealthWatch.

The Company's fees for the services it performed for HealthWatch during
1999, which consisted of designing, developing and implementing data storage and
reporting applications for Medicaid claims data, and support services for such
applications, were approximately $1.9 million. The Company believes that the
prices and terms of the services for HealthWatch are no less favorable to the
Company than those which the Company would have received in an arms' length
transaction with an unaffiliated third party.

During 1999, the Company also performed services for Sperry & Hutchinson
Company, Inc. ("S&H"). Messrs. Greenberg, Moore and Desai and members of Mr.
Moore's family own approximately 18% of the outstanding capital stock of S&H.
The Company's services to S&H involved the formulation and development of a
business and web strategy for implementing a multi-channel customer loyalty
program. The Company also provided creative and technical design,
implementation, and integration services for a web site relating to S&H's
customer loyalty program. The Company's fees for the services it performed for
S&H during 1999 were approximately $3.0 million.

On January 31, 2000, the Company entered into a strategic relationship with
a client which included, among other things, the Company becoming a preferred
supplier to that client and its numerous affiliated entities. As part of the
relationship, Messrs. Greenberg and Moore each issued a $10.0 million
convertible note to the client. The notes are convertible into shares of the
Company's common stock owned by Messrs. Greenberg and Moore at a conversion rate
equal to the closing price of the Company's Common Stock on the date the
convertible notes were executed. The client's ability to convert the notes is
subject to certain vesting restrictions, based upon the client's ability to
achieve certain revenue targets to Sapient within certain prescribed timeframes.
The notes cannot be converted before May 15, 2002.

PROPOSAL 2 -- APPROVAL OF AN
AMENDMENT INCREASING AUTHORIZED COMMON STOCK

On February 17, 2000, the Board of Directors of the Company approved,
subject to stockholder approval, an amendment to the Company's Amended and
Restated Certificate of Incorporation increasing the number of authorized shares
of Common Stock from 100,000,000 to 200,000,000.

THE BOARD OF DIRECTORS BELIEVES THAT THE PROPOSED AMENDMENT IS IN THE BEST
INTERESTS OF THE COMPANY AND ITS STOCKHOLDERS AND THEREFORE RECOMMENDS A VOTE
"FOR" THIS PROPOSAL.

The authorized Common Stock of the Company currently consists of
100,000,000 shares, $.01 par value, of which (i) 57,472,630 shares were
outstanding as of December 31, 1999 and (ii) 12,968,927 shares were reserved for
issuance as of December 31, 1999 pursuant to the Company's existing stock plans.

The Board believes that the authorization of additional shares of Common
Stock is desirable to provide shares for issuance in connection with the
exercise of stock options expected to be granted under the Company's option and
stock purchase plans, including the 1998 Stock Incentive Plan and the amended
1996 Employee Stock Purchase Plan, and in connection with possible future stock
dividends, financings, joint ventures, acquisitions and other general corporate
purposes. Other than as described above, however, there are no existing plans,
understandings or agreements for the issuance of any shares of Common Stock. If
the amendment is adopted by the Company's stockholders, the Board of Directors
will have the authority to issue

12
<PAGE> 15

shares of Common Stock without the necessity of further stockholder action.
Holders of the Common Stock have no preemptive rights with respect to any shares
which may be issued in the future.

Under Delaware law, stockholders are not entitled to dissenter's rights
with respect to the proposed amendment to the Company's Amended and Restated
Certificate of Incorporation.

INDEPENDENT AUDITORS

The Board of Directors has selected the firm of PricewaterhouseCoopers LLP
as independent auditors of the Company for the current fiscal year. A
representative of PricewaterhouseCoopers LLP is expected to be present at the
Annual Meeting to respond to appropriate questions, and to make a statement if
he or she so desires.

On July 21, 1999, the Company dismissed KPMG LLP as its independent
certified public accountant. The reports of KPMG LLP on the Company's financial
statements for the fiscal years ended December 31, 1998 and 1997 did not contain
an adverse opinion, or disclaimer of opinion and were not qualified or modified
as to uncertainty, audit scope or accounting principles. During the Company's
two most recent fiscal years and subsequent interim periods, there were no
disagreements with KPMG LLP on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedures, which
disagreements, if not resolved to the satisfaction of KPMG LLP would have caused
it to make reference to such disagreement in its reports. The Audit Committee of
the Company's Board of Directors recommended the change of accountants and that
action was approved by the Company's Board of Directors. The Company solicited
proposals from various accounting firms and following review of such proposals,
engaged PricewaterhouseCoopers LLC to act as the Company's independent certified
public accountant effective July 22, 1999. During the two most recent fiscal
years and subsequent interim periods, the Company has not consulted
PricewaterhouseCoopers LLP regarding the application of accounting principles to
a specified transaction, either completed or proposed, or the type of audit
opinion that might be rendered on the Company's financial statements, or any
matter that was the subject of a disagreement or a reportable event.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors, executive officers and holders of more than 10% of the
Common Stock to file with the Securities and Exchange Commission initial reports
of ownership and reports of changes in ownership of Common Stock and other
equity securities of the Company. Based solely upon a review of reports
submitted, and representations made, to the Company, the Company believes that
during 1999 its executive officers, directors and holders of more than 10% of
the Common Stock complied with all Section 16(a) filing requirements, other than
a late filing by Ms. Johnson reporting a stock option exercise in 1998 and a
late filing by Mr. Desai reporting a stock option exercise and related sale of
shares in 1999.

OTHER MATTERS

The Board of Directors knows of no other business which will be presented
for consideration at the Meeting other than that described above. However, if
any other matters are properly presented to the Meeting, it is the intention of
the persons named in the accompanying proxy to vote, or otherwise act, in
accordance with their judgment on such matters.

The Company will bear the costs of soliciting proxies. In addition to
solicitations by mail, the Company's directors, officers and regular employees
may, without additional remuneration, solicit proxies by telephone,

13
<PAGE> 16

telegraph, facsimile and personal interviews. The Company reserves the right to
retain outside agencies for the purpose of soliciting proxies. The Company will
also request brokerage houses, custodians, nominees and fiduciaries to forward
copies of the proxy material to those persons for whom they hold shares and
request instructions for voting the proxies and the Company will reimburse them
for their out-of-pocket expenses in connection with this distribution.

STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING

Any proposal that a stockholder of the Company wishes to be considered for
inclusion in the Company's proxy statement and proxy card for the Company's 2001
Annual Meeting of Stockholders (the "2001 Annual Meeting") must be submitted to
the Secretary of the Company at its offices, One Memorial Drive, Cambridge,
Massachusetts 02142, no later than January 5, 2001.

If a stockholder of the Company wishes to present a proposal before the
2001 Annual Meeting, but does not wish to have the proposal considered for
inclusion in the Company's proxy statement and proxy card, such stockholder must
also give written notice to the Secretary of the Company at the address noted
above. The Secretary must receive such notice not less than 60 days nor more
than 90 days prior to the 2001 Annual Meeting; provided that, in the event that
less than 70 days' notice or prior public disclosure of the date of the 2001
Annual Meeting is given or made, notice by the stockholder must be received not
later than the close of business on the 10th day following the date on which
such notice of the date of the meeting was mailed or such public disclosure was
made, whichever occurs first. If a stockholder fails to provide timely notice of
a proposal to be presented at the 2001 Annual Meeting, the proxies designated by
the Board of Directors of the Company will have discretionary authority to vote
on any such proposal.

By Order of the Board of Directors,

JERRY A. GREENBERG
Secretary

May 5, 2000

THE BOARD OF DIRECTORS HOPES THAT STOCKHOLDERS WILL ATTEND THE MEETING.
HOWEVER, WHETHER OR NOT YOU PLAN TO ATTEND, YOU ARE URGED TO COMPLETE, DATE,
SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. PROMPT RESPONSE
WILL GREATLY FACILITATE ARRANGEMENTS FOR THE MEETING AND YOUR COOPERATION IS
APPRECIATED. STOCKHOLDERS WHO ATTEND THE MEETING MAY VOTE THEIR STOCK PERSONALLY
EVEN THOUGH THEY HAVE SENT IN THEIR PROXIES.

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<PAGE> 17

PROXY

SAPIENT CORPORATION

ANNUAL MEETING OF STOCKHOLDERS - MAY 24, 2000

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

Those signing on the reverse side, revoking all prior proxies, hereby
appoint(s) Jerry A. Greenberg and J. Stuart Moore, and each of them, with full
power of substitution, as Proxies to represent and vote as designated hereon
all shares of stock of Sapient Corporation (the "Company") which the
undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders of the Company to be held on Wednesday, May 24, 2000,
at 9:00 p.m., Boston time, at the offices of the Company, One Memorial Drive,
Cambridge, Massachusetts and at any adjournment thereof.

PLEASE FILL IN, DATE, SIGN AND MAIL THIS PROXY
IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE.

HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?

- ----------------------------- --------------------------------

-------------
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE) SEE REVERSE
SIDE
-------------
<PAGE> 18

--------------------------------
WHEN PROXY IS OKAYED PLEASE SIGN
& DATE IT ABOVE

PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!

ANNUAL MEETING OF STOCKHOLDERS
SAPIENT CORPORATION

MAY 24, 2000

Please Detach and Mail in the Envelope Provided
<TABLE>
<S> <C>
A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE

IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE CLASS I DIRECTOR NOMINEES AND FOR PROPOSAL 2.

FOR WITHHELD FOR AGAINST ABSTAIN
1. To elect two NOMINEES: 2. To approve an amendment to the Company's
Class I [ ] [ ] Jerry A. Greenberg Amended and Restated Certificate of [ ] [ ] [ ]
Directors for Bruce D. Parker Incorporation increasing the number of
the ensuring authorized shares of Common Stock from
three years. 100,000,000 to 200,000,000.

[ ] For both nominees except at noted below In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the Meeting or any
_______________________________________ adjournment thereof.

MARK BOX AT RIGHT IF COMMENTS OR ADDRESS CHANGE [ ]
HAVE BEEN NOTED ON THE REVERSE SIDE OF THIS CARD.

Signature:___________________________________ Date: _______________ Signature: ______________________ Date: _____________________

NOTE: Please sign exactly as name appears hereon. If the stock is registered in the names of two or more persons, each should sign.
When signing as an executor, administrator, trustee, guardian, or attorney, please give full title as such. If a corporation,
please sign in full corporate name by an authorized officer. If a partnership, please sign in full partnership name by an
authorized person.
</TABLE>