2016 VP Bonus Plan - SendGrid Inc.
SendGrid, Inc.
2016 VP Bonus Plan
SendGrid, Inc. Confidential
Adopted Effective January 1, 2016
PROGRAM OBJECTIVES
We believe it is important to tie our compensation to individual and company performance. The 2016 VP Bonus Plan (the "Bonus Plan") provides an opportunity whereby certain employees (a "Participant") may be eligible to receive a bonus (a "Bonus") based on a combination of the Participant's Individual Performance and the Company's Performance.
ELIGIBILITY
Participants are eligible to participate in the Bonus Plan as determined by the Chief Executive Officer. The Participant must be employed and in good standing on the date of the Target Bonus payment to be eligible for any portion of the Target Bonus and must execute the Participation Agreement attached hereto as Exhibit A.
BONUS PLAN CYCLE
The effective date of this Bonus Plan is January 1, 2016. Participant's Target Bonus for the full calendar year shall be as defined in the Participant's Participation Agreement. The Target Bonus will be paid on a regular payroll cycle no more than 75 calendar days following the end of the Bonus Period. For purposes of this Bonus Plan, the Bonus Period is defined as the completion of calendar year 2016.
WEIGHTING OF AWARDS
Eligibility to receive a Participant's Target Bonus is based upon a combination Individual Performance, weighted at 20% of Target Bonus, and the Company's Performance (defined below), weighted at 80% of Target Bonus for the Bonus Period.
INDIVIDUAL PERFORMANCE
The Individual Performance Achievement of the potential Target Bonus shall consist of demonstrable activity of both competencies and responsibilities resulting in the following ratings.
|
Rating |
Description |
% of Target |
|
1 - Insufficient |
Objectives were not achieved and the outcomes were poor |
0% |
|
2 - Below Expectations |
Objectives were not quite achieved and the results were below expectations |
<10% |
|
3 - Good |
Objectives were achieved and the results were what was expected |
20% |
|
4 - Great |
Objectives were achieved and the results were beyond expectations |
Discretionary |
|
5 - Amazing |
Objectives were achieved and the results were truly outstanding |
Discretionary |
COMPANY PERFORMANCE
The Company Performance Achievement of the potential Target Bonus shall consist of an array of metrics that reflect our Enduring Measures of Success to include: 1. Customer Satisfaction, 2. Employee Engagement, 3. Innovation, 4. Revenue growth and 5. Profitability. Annualized recurring revenue ("ARR") is calculated by multiplying the Q4 2016 recurring revenue by four (4).
1.
|
Enduring Measure |
Metric |
2016 Plan |
% of Target Bonus
|
|
Financial
|
Revenue (GAAP) |
$76.5 |
12.50% |
|
Financial
|
ARR (Q4) |
$85.5 |
12.50% |
|
Financial
|
2H Adjusted NI |
$0.5 |
25% |
|
Customer
|
NPS |
42 |
10% |
|
Employee Engagement
|
Engagement % |
75 |
10% |
|
Innovation
|
ARR from New Products |
$8.3MM |
10% |
2016 REVENUE PAYOUT MATRIX
|
2016 Revenue Goals ($MM)
|
|
|
|
|
|
|
Range |
Low |
Base |
High |
|
Revenue (GAAP)
|
(20%) to +20% |
$61.20 |
$76.50 |
$91.80 |
|
ARR (Q4)
|
(10%) to +10% |
$76.95 |
$85.50 |
$94.05 |
|
Revenue-related Goals Payout Matrix
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|
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Revenue (GAAP) |
||
|
|
|
Low
|
Base |
High |
|
ARR (Q4) |
Low
|
80% |
85% |
90% |
|
Base
|
85% |
100% |
105% |
|
|
High
|
90% |
115% |
120% |
|
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OTHER VARIABLE COMP ELEMENTS PAYOUT MATRIX
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|
|
Payout Targets |
||
|
Goal
|
Base Plan |
Low (-20%) |
Base |
High (+20%) |
|
2H Adjusted NI (MM)
|
$0.50 |
$0.40 |
$0.50 |
$0.60 |
|
NPS
|
42 |
36 |
42 |
54 |
|
Engagement
|
75 |
60 |
75 |
90 |
|
Goal
|
|
Payout % |
||
|
2H Adjusted NI
|
|
80% |
100% |
120% |
|
NPS
|
|
80% |
100% |
120% |
|
Engagement
|
|
80% |
100% |
120% |
2.
|
Goal |
Base Payout |
Payout % of Total Variable in 2016 |
||
|
2H Adjusted NI |
25% |
20% |
25% |
30% |
|
NPS |
10% |
8% |
10% |
12% |
|
Engagement |
10% |
8% |
10% |
12% |
Zero (0) payout below 80% achievement and capped payout above 120% achievement. If results fall between levels then the respective Bonus percentage will be calculated based on linear interpolation.
MISCELLANEOUS
This Bonus Plan supersedes any and all other bonus plans that may have been discussed prior to the effective date of this Bonus Plan.
Eligible employees starting in their position after July 1st may or may not have their Target Bonus prorated. Determination of proration is at the discretion of the CEO and/or the Company's Board of Directors.
Participants who were on a leave of absence 30 or more days during the Bonus Plan period are eligible for a prorated Target Bonus consideration.
The Company reserves the right to amend, discontinue or rescind this Bonus Plan at any time and /or add, reduce or limit the amount of any Bonus payments or to limit the number of participants any time such actions are deemed appropriate and in the best interest of the Company.
The Bonus Plan is intended to provide a financial incentive to Participants and is not intended to confer any rights to continued employment upon Participants whose employment will remain at-will and subject to termination by either the Company or Participant at any time, with or without cause or notice.
The rights and obligations of a Participant under the Bonus Plan will be governed by and interpreted, construed and enforced in accordance with the laws of the State of Colorado without regard to its or any other jurisdiction's conflicts of laws principles.
The Bonus Plan and the executed Participation Agreement set forth all of the agreements and understandings between the Company and Participant with respect to the subject matter hereof, and supersedes and terminates all prior agreements and understandings between the Company and Participant with respect to the subject matter hereof.
3.
EXHIBIT A
SENDGRID, INC.
2016 VP BONUS PLAN
PARTICIPATION AGREEMENT
This Participation Agreement (the "Participation Agreement") is entered into by and between SendGrid, Inc., a Delaware corporation (the "Company"), and the undersigned employee of the Company ("Participant"), as of the date set forth below.
This Participation Agreement is attached to a copy of the 2016 VP Bonus Plan (the "Plan"). Each capitalized term not defined in this Participation Agreement will have the meaning ascribed to such term in the Plan.
The Board has designated you a Participant in the Plan. You are encouraged to read the Plan in its entirety. The final decision as to whether you have earned any payments under the Plan will be made by the Board or the Representative in accordance with the Plan.
Participant's total Target Bonus for 2016 shall be 25% of earned base salary ("Target Bonus").
In consideration of your eligibility to participate in the Plan as a Participant, a benefit to which you are not otherwise entitled, you hereby agree, to the greatest extent permitted by law, and to the extent applicable, to the following terms of the Plan:
1. You must continue to be a satisfactory performer as determined by your manager.
2. This Participation Agreement does not constitute a guarantee of a specific period or term of employment and does not constitute an employment contract. Your employment remains "at will", and you continue to be subject to all company policies and guidelines.
3. SendGrid reserves the right to change, eliminate or replace all or parts of the Plan at will at any time, with or without notice, to adjust targets, objectives, to terminate the Plan or make any other adjustments and changes deemed appropriate.
4. This Participation Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Participation Agreement and the Participation Agreement shall not be modified or rescinded, except by a written Participation Agreement signed by SendGrid, Inc. and you. The provisions of this Agreement supersede all prior and contemporaneous discussions, writings and understandings of the parties with respect to the subject matter of this Participation Agreement.
To indicate your acceptance of your designation as a Participant in the Plan, please sign a copy of this Participation Agreement in the space indicated below.
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Name |
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Sameer Dholakia, CEO for SendGrid, Inc. |
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Date |
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Date |
4.