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Exhibit 10.8

ShoreTel, Inc. Executive Incentive Compensation Plan
 
The purpose of the ShoreTel, Inc. (the “Company”) Executive Incentive
Compensation Plan (the “Plan”) is to incentivize Company executives, including
the CEO, to achieve key corporate objectives that maximize shareholder value.
 Executives participating in the Plan will be designated by the Compensation
Committee and may exclude sales executives. To participate in the Plan, an
executive must be employed on a regular basis and meet other requirements set
forth below.
 
Company Objectives
 
Executive Objectives.  The performance objectives for executives will consist of
corporate financial objectives, strategic objectives and/or other objectives
determined by the Compensation Committee, with the percentages allocated to each
to be determined by the Compensation Committee.  The financial objectives may
consist of pre-defined targets of revenues, non-GAAP operating profit, and any
other GAAP or non-GAAP financial or other operational measures.  In addition,
the amounts payable may be subject to a multiplier or decelerator based on the
Company’s customer satisfaction ratings or such other objectives as determined
by the Compensation Committee. The targets for these metrics will be established
by the Compensation Committee near the beginning of each fiscal year or such
other fiscal periods as determined by the Compensation Committee (“Designated
Fiscal Period:).
 
CEO Objectives.  The performance objectives for the CEO may differ from the
objectives for other executives.
 
In order to receive a bonus under this Plan, minimum achievement thresholds must
be met. The Compensation Committee has discretion to modify the objectives, key
measurement metrics and weighting thereof.
 
Bonus Pool
 
The total amount of incentive compensation available for distribution to
participants under this Plan in each Designated Fiscal Period (the “Bonus Pool”)
is equal to the product of (a) percentage achievement of the objective targets
set forth above, (b) the sum of each participant’s base salary for the
Designated Fiscal Period multiplied by a factor determined by the Compensation
Committee (which does not need to be the same for each participant ) of up to
100% (“Bonus Percentage”), and (c) any additional amount or multiplier or
decelerator determined by the Compensation Committee (“Multiplier”).
 
Individual Target Levels
 
Payments to participants are based on the size of the Bonus Pool and each
participant’s individual performance rating. The actual amount paid to a
participant is equal to the product of (a) percentage achievement of the
objective targets, (b) the participant’s base salary for the Designated Fiscal
Period, (c) the participant’s Bonus Percentage, and (d) the participant’s
performance rating, subject to any Multiplier adjustment.
 
The CEO will recommend bonus payment allocations for the executive officers
except himself, up to a maximum of 150% of the Bonus Pool. However, to prevent
total bonus payments under this Plan from exceeding the Bonus Pool, each
participant’s performance rating is subject to downward adjustment to reflect
his/her achievement relative to the achievement of other participants.
 
Plan Payout
 
Based on Company performance against the predetermined targets for the
Designated Fiscal Period, or portions thereof as the Compensation Committee may
determine, the CFO will compute the overall Bonus Pool for the executives. The
CEO will recommend allocation of the Bonus Pool for all executives other than
himself and the Compensation Committee has the authority to approve payments to
same. For the CEO, the Compensation Committee will review CEO performance
against CEO targets and recommend a bonus to the Board.  Payments will be made
in accordance with the Company’s normal payroll practices following the end of
the Designated Fiscal Period, or portions thereof as the Compensation Committee
may determine.  In addition to the foregoing, bonus payments hereunder will be
made within the short term deferral period under Internal Revenue Code Section
409A and the regulations thereunder.

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Other Provisions
 

· Participation in this plan is not an agreement (express or implied) between
the Plan participant and the Company that the participant will be employed by
the Company for any specific period of time, nor is there any agreement for
continuing or long-term employment. The Plan participant and the Company each
have right to terminate the employment relationship at any time for any reason.
This at-will employment relationship may only be modified by an agreement signed
by the participant and the CEO.

 

· Any determination of performance, payment or other matter under this plan by
the Board of Directors or Compensation Committee is binding.

 

· This summary highlights the principal features of the Plan, but does not
describe every situation that can occur. The Compensation Committee retains the
right to interpret, revise, modify or terminate the Plan at its sole discretion
at any time.

 

· The executive must be employed in a full time capacity for at least one-half
of the Designated Fiscal Period, or such other period as determined by the
Compensation Committee, to be eligible to participate in this Plan, and must be
employed at the time bonuses are paid in order to receive a bonus, unless
otherwise approved by the Compensation Committee or required pursuant to a
separate agreement with the executive.

 

· This Plan is intended to be effective commencing fiscal year 2014, and shall
remain in effect for subsequent fiscal periods until amended or terminated by
the Compensation Committee.

 
 
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