Exhibit 10.1
Phase Forward
Incorporated
Management Incentive
Plan
Effective January 1,
2009
Phase Forward
Incorporated
Management Incentive Plan
(MIP)
Plan Document
Effective January 1,
2009
TABLE OF CONTENTS
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Section
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Page
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I.
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Purpose
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3.
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II.
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Effective Date
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3.
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III.
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Eligibility
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3.
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IV.
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Bonus
Determination
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3.
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V.
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Payment and Transition
Issues
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4.
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VI.
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Administration
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4.
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VII.
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Return of Excess
Distributions
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5.
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2
Phase Forward
Incorporated
Management Incentive Plan
(MIP)
Plan Document
I.
Purpose
This Management Incentive Plan (the
“MIP”) is intended to recognize and reward the
achievement of financial performance goals that are essential to
the success of Phase Forward. This program, in conjunction
with base salary is designed to offer designated employees of Phase
Forward Incorporated and/or its subsidiaries (the
“Company”) total cash compensation opportunities that
are fully competitive with market levels. The MIP is for the
benefit of Covered Employees (as defined below).
II.
Effective Date
The effective date for
implementation of the MIP shall be January 1, 2009. A MIP
year is equivalent to a calendar year. The MIP may be modified or
terminated at any time by the Management Development and
Compensation Committee or their designee in its or their sole
discretion, without notice or consent of the
participants.
III.
Eligibility
From time to time, the executive
management of the Company and/or the Management Development and
Compensation Committee may select certain employees (the
“Covered Employees”), whose roles and responsibilities
are deemed by executive management to be critical to operations
and/or who are at a management level in the Company, to be eligible
to receive bonuses hereunder.
IV.
Bonus Determinations
A Covered Employee may receive a
bonus payment under the MIP based upon the attainment of
performance targets which are established by executive management
of the Company and approved by the Management Development and
Compensation Committee. The performance targets will relate
to financial and operational metrics with respect to the Company or
any of its subsidiaries (the “Performance Goals”),
including the following: earnings per share, revenues, EBITDA
(earnings before interest, taxes, depreciation and amortization),
net income (loss) (either before or after interest, taxes,
depreciation and/or amortization), changes in the market price of
the Stock, economic value-added, funds from operations or similar
measure, sales or revenue, acquisitions or strategic transactions,
proforma operating income (loss), cash flow (including, but not
limited to, operating cash flow and free cash flow), return on
capital, assets, equity, or investment, stockholder returns, return
on sales, gross or net profit levels, productivity, expense,
margins, operating efficiency, customer satisfaction, working
capital, sales or market shares, bookings and number of customers,
any of which may be measured either in absolute terms or as
compared to any incremental increase or as compared to results of a
peer group.
Covered Employees will be assigned a
target payout for the MIP, expressed as a percentage of total base
salary. This percentage represents the potential dollar award
that could be earned upon achievement of Performance Goals and will
vary according to the participant’s position. Each Covered
Employee shall have a targeted bonus opportunity for each
performance period. The
3
actual dollar award may exceed the
target payout in the event of over-achievement of Performance Goals
subject to a maximum of 200% of the Covered Employee’s bonus
opportunity; provided, however, such limitation shall be 300% for
any performance targets based on bookings, sales quotas or similar
sales metrics.
The performance targets may change
as approved by the Management Development and Compensation
Committee in its sole di
