Exhibit 10.2+
FY2016 Metric Based Bonus - Employee Plan
Effective February 1, 2015 - January 31, 2016
Objectives
· Promotes team based goals/results linked to corporate goals/results.
· Provide incentives to employees to meet and exceed new product and services bookings and renewal rates, thereby increasing the value of Rally (increase shareholder value).
· All employees share in the success of Rally.
· Align employees with the primary goals of Rally.
· Aligns Rally pay with other High Tech companies.
Eligibility
· All non-commissioned regular employees are eligible.
· Employees must be employed on the first and last business day of the quarter to be eligible to receive a payout for that respective quarter.
Bonus Plan Period
FY2016:
· Q1: February 1, 2015 through April 30, 2015
· Q2: May 1, 2015 through July 31, 2015
· Q3: August 1, 2015 through October 31, 2015
· Q4: November 1, 2015 through January 31, 2016
Target Bonus
All non-commissioned employees are assigned a grade level with an associated target bonus percentage. The bonus will be calculated based on actual employee earnings for the time respective period.
* Actual earnings include actual base salary earnings only and exclude all other compensation such as bonus payments.
Bonus Plan Metrics
· MBB will be measured against three separate categories for each discrete quarter: (1) New Product Bookings, (2) Services Bookings, and (3) a Renewal Rate.
· Metric targets for New Products Bookings, Services Bookings and Renewal Rate are aligned with the Board-approved operating plan.
· Quarterly MBB payment will be paid to participants based on a preset schedule defining MBB % payment against metrics (See Below).
· Threshold payment will be set at 85% achievement against New Product and Services Bookings with a payment equal to 55% of target bonus. Threshold payment will be set at 75% achievement against the Renewal Rate with a payment equal to 55% of target bonus. MBB payment is made for a particular category if that category hits its threshold percentage (i.e. payment in one category is not dependent on a minimum threshold being met in all three categories).
· Maximum payment will be set at 110% achievement against New Product and Services Bookings with a payment equal to 150% of target bonus. Maximum payment will be set at 95% achievement against the Renewal Rate with a payment equal to 150% of target bonus.
Metrics Weighting
The metrics will be weighted in the following manner.
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New Product Booking equals 35% of total achievement, Services Bookings equals 35% of total achievement and the Renewal Rate equals 30% of total achievement.
Payout Schedule
· The New Product and Services Bookings achievement ranges are 85% to 110%. The Renewal Rate range is 75% to 95%.
NPB Bookings | | Employee NPB
Payout % | |
85% | | 55% | |
86% | | 58% | |
87% | | 61% | |
88% | | 64% | |
89% | | 67% | |
90% | | 70% | |
91% | | 73% | |
92% | | 76% | |
93% | | 79% | |
94% | | 82% | |
95% | | 85% | |
96% | | 88% | |
97% | | 91% | |
98% | | 94% | |
99% | | 97% | |
100% | | 100% | |
101% | | 105% | |
102% | | 110% | |
103% | | 115% | |
104% | | 120% | |
105% | | 125% | |
106% | | 130% | |
107% | | 135% | |
108% | | 140% | |
109% | | 145% | |
110% | | 150% | |
Services Bookings | | Employee NPB
Payout % | |
85% | | 55% | |
86% | | 58% | |
87% | | 61% | |
88% | | 64% | |
89% | | 67% | |
90% | | 70% | |
91% | | 73% | |
92% | | 76% | |
93% | | 79% | |
94% | | 82% | |
95% | | 85% | |
96% | | 88% | |
97% | | 91% | |
98% | | 94% | |
99% | | 97% | |
100% | | 100% | |
101% | | 105% | |
102% | | 110% | |
103% | | 115% | |
104% | | 120% | |
105% | | 125% | |
106% | | 130% | |
107% | | 135% | |
108% | | 140% | |
109% | | 145% | |
110% | | 150% | |
Renewal Rate % | | Employee Ren
Rate Payout % | |
75% | | 55.0% | |
76% | | 59.5% | |
77% | | 64.0% | |
78% | | 68.5% | |
79% | | 73.0% | |
80% | | 77.5% | |
81% | | 82.0% | |
82% | | 86.5% | |
83% | | 91.0% | |
84% | | 95.5% | |
85% | | 100.0% | |
86% | | 105.0% | |
87% | | 110.0% | |
88% | | 115.0% | |
89% | | 120.0% | |
90% | | 125.0% | |
91% | | 130.0% | |
92% | | 135.0% | |
93% | | 140.0% | |
94% | | 145.0% | |
95% | | 150.0% | |
MBB Bonus Calculation
The bonus payment is equal to the target bonus % for the respective grade multiplied by the New Product Bookings achievement weighted at 35% + Services Booking achievement weighted at 35% + Renewal Rate weighted at 30% multiplied by actual employee earnings:
(Target Bonus %) * ((New Product Bookings % * 35%) + (Services Bookings % * 35%) + (Renewal Rate % * 30%)) x (Actual Earnings )
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Example:
New Product Bookings Achievement (weighted at 35%) = 95%
Services Bookings Achievement (weighted at 35%) = 105%
Renewal Rate (weighted at 30%) = 82%
MBB payout percent:
New Product Bookings = 85%
Services Bookings = 125%
Renewal Rate = 86.5%
(85% * 35%) + (125% * 35%)+ (86.5% * 30%) = 99.45%
Earnings = $22,000 (assuming an annual salary of $88,000)
Target Bonus = 5%
5% * 99.45% * 22,000 = $1,093.95
Other Provisions
· Metric achievements that fall between percentages will be prorated based on the distance between those percentages. For example, if NPB achievement were 87.5%, then payout would equal 62.5%. The difference between 87% and 87.5% equals .5%. There is a 3% payout increment for every 1% increase in achievement up to 100%. The NPB metric payout would be calculated by multiplying .5% (difference between 87% and 87.5%) with 3% (step increase in NPB achievement between 87% and 88%). The result is 1.5%, which is then added to 61% payout for a total NPB payout of 62.5%.
· Part-time employees will be paid out in accordance with their reduced schedule based on their actual earnings.
· Employees on sabbatical are entitled to full MBB allocation.
· Employees on qualified FMLA leave are entitled to full MBB allocation, regardless of duration.
· Employees on personal non-medical leave will not receive a payout for the period of unpaid leave.
· Management reserves the right to interpret, change or cancel this plan at any time at its discretion.
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