Transition Agreement

Transition Agreement

This Transition Agreement made as of this 1st day of August 2007 by and between Lionbridge Technologies, Inc. (the “Company”) and Stephen J. Lifshatz (“Mr. Lifshatz”).

WHEREAS Mr. Lifshatz has served as the Company’s Chief Financial Officer since January 1997;

WHEREAS , Mr. Lifshatz has indicated to the Company his desire to explore another professional opportunity which has been or may be presented to him; and

WHEREAS the Company desires to secure his continued service for a designated period of time to allow for the timely completion of his current assignments and to allow for an appropriate transition of duties to a new Chief Financial Officer, and to provide strategic advice to the Company for a period of time following selection of a successor Chief Financial Officer.

NOW, THEREFORE , in consideration of the foregoing and the mutual covenants contained herein, the parties agree as follows.

1. (a) Contractual Status . Mr. Lifshatz agrees to remain employed as the Company’s Chief Financial Officer from the date of this Transition Agreement until the earlier of the date a new Chief Financial Officer commences employment with the Company, a date mutually agreed between Mr. Lifshatz and the Company, or August 24, 2007 (“Transition Period”) and shall immediately resign from the position of Chief Financial Officer on such date. During this Transition Period, Mr. Lifshatz will continue to perform those duties and responsibilities customary and consistent with his position as Chief Financial Officer, including those activities set forth on Attachment A (the “Transition Activities”). The Company agrees that it shall make reasonable accommodations to Mr. Lifshatz in order to facilitate his efforts to explore other professional opportunities, provided that such efforts do not interfere with or impede Ms. Lifshatz’s performance of his duties as described above and in Attachment A. During this Transition Period, Mr. Lifshatz will continue to receive the same salary, fringe benefits, and restricted stock and stock option vesting to which he was entitled immediately prior to the execution date of this Transition Agreement. In addition, Mr. Lifshatz shall remain entitled to receive a pro-rata share of his incentive compensation due under the Company’s Management Incentive Plan for the portion of 2007 during which he served as CFO (i.e., determined based on the period from January 1, 2007 through the Transition Date (defined below), and determined based on achievement of the metrics set forth in the MIP, as determined by the Company and its Nominating and Compensation Committee in its sole discretion and with respect to the revenue and profit metrics of the MIP, utilizing a consistent manner of determination of achievement of such metrics as is utilized for other MIP participants), payable following the end of 2007 and after public announcement of the Company’s financial results for fiscal year 2007. The date of Mr. Lifshatz’s resignation as Chief Financial Officer is referred to herein as the “Transition Date”. Effective as of the date Mr. Lifshatz resigns as Chief Financial Officer, he shall also automatically resign as an officer or director of any subsidiary of the Company, and as Assistant Secretary and Assistant Treasurer of the Company and will execute any documentation requested by the Company to effect such resignations.

(b)  Strategic Advisor .

(i)  Duties . Effective on the Transition Date, Mr. Lifshatz shall serve as an employee of the Company in the capacity of strategic advisor to the Company, reporting to the Chief Executive Officer, for the period commencing on the Transition Date and ending on the 10 month anniversary of the Transition Date (such period to be referred to as the “Post-Transition Period”, and its end date as the “Termination Date”). During the Post-Transition Period, Mr. Lifshatz shall continue to exercise such powers and comply with and perform, faithfully and to the best of his ability, such directions and duties in relation to the business and affairs of the Company as may from time to time reasonably be vested in or requested of him, which shall include, but not be limited to, transition activities and other special strategic projects as reasonably requested by the Chief Executive Officer. Mr. Lifshatz may be employed by another entity during the Post-Transition Period provided such employment is not in violation of the non-competition obligations described in Section 3 and provided further that such activities do not diminish his ability to carry out his duties to the Company.

(ii)  Salary and Benefits . During the Post-Transition Period, Mr. Lifshatz shall be paid the same base salary level as he previously received, and receive the same fringe benefits, including health and welfare benefits as received by other U.S. employees of the company, but shall no longer be eligible for participation in the Management Incentive Plan for the remaining portion of 2007 or any subsequent year. Any and all fringe benefits that are referenced in this subparagraph shall be terminated sooner as of any date that Mr. Lifshatz commences receiving substantially similar or better benefits through another employer.

(iii)  Equity. At the end of the Post-Transition Period and upon a determination by the Board of Directors reasonably and in good faith that Mr. Lifshatz has discharged his duties in accordance with this Agreement, vesting with respect to 50% of any options and restricted stock which are unvested or not exercisable as of the last day of the Post-Transition Period shall be accelerated.

(iv)  Right of Company to Terminate for Cause . At any time during this Post-Transition Period, the Company may terminate Mr. Lifshatz’ employment with or without notice for Cause. For purposes of this agreement, the following events or conditions shall constitute “Cause” for termination: (a) fraud, embezzlement, or other act of dishonesty by Mr. Lifshatz that causes material injury to the Company or any of its affiliates; (b) conviction of, or plea of nolo contendere to, any felony involving dishonesty or moral turpitude associated with the Company; or (c) a failure by Mr. Lifshatz to take or refrain from taking any corporate action consistent with his duties as an employee of the Company as specified in written directions of the Board or the President and Chief Executive Officer following receipt by the Executive of such written directions, which failure is not cured within 30 days after written notice that failure to take or refrain from taking such action shall constitute “Cause” for purposes hereof. In addition, a breach of Section 3 of this Agreement, or the underlying agreements referenced in Section 3, is “Cause”. The date upon which the Post-Transition Period, and Mr. Lifshatz’s employment, terminates shall be referred to herein as the “Termination Date” and Mr. Lifshatz’s employment with the Company shall terminate without any further action on either party, on the Termination Date.

(v)  Indemnification and Insurance . The Company agrees that during Mr. Lifshatz’s service as Chief Financial Officer during the Transition Period, and as a Strategic Advisor during the Post-Transition Period, he shall be treated as an “officer” for purposes of determining availability of the indemnification provisions applicable to the Company under the Delaware Corporation Law, its Second Amended and Restated Certificate of Incorporate and its Restated By-Laws and with respect to the Company’s Director and Officers liability insurance, in each case in relation to acts undertaken at the request of the Company on or before the end of the Post-Transition Period.

2.  Other Agreements . Mr. Lifshatz’s Employment Agreement dated as of February 11, 1997 is expressly terminated and superseded by this Agreement. Mr. Lifshatz’s Change of Control Agreement dated as of November 2, 2006 is expressly terminated and superseded by this Agreement effective as of the Transition Date.

3.  Non-Disclosure, Non-Competition and Non-Solicitation Obligations .