Exhibit 10.14
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FY11 Sales Compensation Plan

             
Name:
  Kevin Mosher   On Quota Date:   5/1/2010
 
           
Title:
  Senior Vice President, Worldwide Field Operations   Manager:   Tom Reilly

Revenue Target                    As provided in the ArcSight FY 2011 internal
operating plan.

                                  Revenue Commissions   Q1     Q2     Q3     Q4
 
0 - ≤90%
  $ 0     $ 0     $ 0     $ 0  
>90 - ≤95%
  $ 250     $ 250     $ 250     $ 250  
>95 - ≤100%
  $ 1,250     $ 1,250     $ 1,250     $ 1,250  
>100 - ≤105%
  $ 3,000     $ 3,000     $ 3,000     $ 3,000  
>105%
  $ 6,000     $ 6,000     $ 6,000     $ 6,000  

                                              Q1     Q2     Q3     Q4     FY11  
Quarterly Revenue Bonus
  $ 10,000     $ 10,000     $ 10,000     $ 10,000     $ 40,000  

                                  Margin Contribution Bonus   Q1     Q2     Q3  
  Q4  
100%
  $ 10,000     $ 10,000     $ 10,000     $ 10,000  
>100 - ≤105%
  $ 23,000     $ 23,000     $ 23,000     $ 23,000  
>105 - ≤115%
  $ 35,000     $ 35,000     $ 35,000     $ 35,000  
>115%
  $ 40,000     $ 40,000     $ 40,000     $ 40,000  

                                          Target Earnings   Q1     Q2     Q3    
Q4     FY11  
Salary
  $ 75,000     $ 75,000     $ 75,000     $ 75,000     $ 300,000  
Revenue Commission
  $ 30,000     $ 30,000     $ 30,000     $ 30,000     $ 120,000  
Quarterly Revenue Bonus
  $ 10,000     $ 10,000     $ 10,000     $ 10,000     $ 40,000  
Margin Contribution Bonus
  $ 10,000     $ 10,000     $ 10,000     $ 10,000     $ 40,000        
Total Compensation
  $ 125,000     $ 125,000     $ 125,000     $ 125,000     $ 500,000  

                                      % of Target   Earnings Above Quota   100%
    105%     110%     115%  
Salary
  $ 300,000     $ 300,000     $ 300,000     $ 300,000  
Revenue Commission
  $ 120,000     $ 180,000     $ 300,000     $ 420,000  
Quarterly Revenue Bonus
  $ 40,000     $ 40,000     $ 40,000     $ 40,000  
Margin Contribution Bonus
  $ 40,000     $ 92,000     $ 140,000     $ 140,000        
Total Compensation
  $ 500,000     $ 612,000     $ 780,000     $ 900,000  

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ArcSight FY11 Sales Compensation Plan
EXHIBIT A — Specific Terms and Conditions
Senior Vice President, Field Operations
CALCULATION OF COMMISSIONS1

I.   Revenue Commissions: Revenue Commissions are calculated based on
achievement by the Company of the quarterly Revenue target specified in the
Company’s fiscal 2011 internal operating plan (“Revenue Target”). The
Commissions for each percentage of achievement of the Revenue Target are
calculated as follows:

  •   provided that actual Revenues exceed 90% of the Revenue Target for the
quarter, $250 multiplied by the percentage of Revenue Target achieved up to 95%;
plus     •   $1,250 multiplied by the percentage of Revenue Target achieved in
excess of 95% up to 100%; plus     •   $3,000 multiplied by the percentage of
Revenue Target achieved in excess of 100% up to 105%; plus     •   $6,000
multiplied by the percentage of Revenue Target achieved in excess of 105%,

in each case, where the percentage of Revenue Target achieved and the
percentages defining each range of performance above are rounded down to the
nearest tenth of a percent and multiplied by 100.
II. Quarterly Revenue Bonus: Quarterly Revenue Bonuses will be paid for
achieving Revenue at least equal to Q1 Revenue Target, Q2 Revenue Target, Q3
Revenue Target, and Q4 Revenue Target. A Plan participant will be eligible for a
Quarterly Revenue Bonus only if the Plan participant was employed by ArcSight on
the last day of the applicable fiscal quarter.
 

1   The calculation of Commissions described in this Exhibit A is qualified in
its entirety by the terms and conditions of Exhibit B.

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III. Margin Contribution Bonus: Each quarter the Commission amount attributable
to operating expense/contribution margin will be determined by either incurring
actual sales operating expenses less than or equal to the sales operating
expense target specified for such quarter in the Company’s fiscal 2011 internal
operating plan or achieving actual sales contribution margins equal to or
greater than the sales contribution margin target specified for such quarter in
the Company’s fiscal 2011 internal operating plan. The quarterly bonus will vary
depending on the level of Revenue achieved relative to the year-to-date Revenue
Target. For example, in Q1 if the Revenue achieved equaled 102% of the
year-to-date Revenue Target and either the actual operating costs were less than
target or the actual contribution margin was greater than target, then the bonus
earned would be equal to the “>100 — ≤105%” amount described on the cover page
of this Plan.
IV. Stock in Lieu of Cash: On the recommendation of the Company’s Chief
Executive Officer and approval by the Compensation Committee, all or a portion
of the Revenue commissions under Section I or the margin contribution bonus
under Section III, in each case that are payable at the greater than 100% level,
may be paid in the form of a “Stock Bonus Award” under the Company’s 2007 Equity
Incentive Plan (as such term is defined therein) in lieu of payment in cash.

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ArcSight FY11 Sales Compensation Plan
EXHIBIT B — General Terms and Conditions
OBJECTIVES
This ArcSight FY11 Sales Compensation Plan (this “Plan”) describes the terms of
your sales compensation at ArcSight, Inc. (“ArcSight” or the “Company”) for the
Plan Year, which is intended to achieve the following objectives:

  •   Increase sales for the Company’s services and products.     •   Reward
consistent achievement and over plan performance on a quarterly basis.     •  
Reward sales personnel for their contribution to the achievement of Company
objectives.     •   Attract and retain an effective sales team.

DEFINITIONS

  1.   Commissions — Opportunity for compensation in addition to the base
salary. Commissions for software and appliances (“Products”), maintenance and
support (“Maintenance”) and professional services (“Services”) are based on
Revenues recognized by the Company for such Products, Maintenance and Services.
    2.   Sales Contract — Comprehensive set of legally binding documents and
required approvals and signatures associated with each Booking, generally an end
user license agreement signed by ArcSight and the customer (or, in the case of
shrinkwrap agreements, agreed to by the customer) or a flow-down agreement
between the reseller and the customer. Sales Contracts typically include the
following items:

  a.   Software License and/or Appliance Revenues — Revenues associated with
licensing of software products and/or sale of appliance products.     b.  
Service Revenues — Revenues associated with sale of consulting and installation
projects that are normally billed as time and materials. Expenses incurred in
the performance of Services are billed to the customer. These expenses are not
counted towards Booking Value for the purpose of calculating Commissions.     c.
  Maintenance Revenues — Revenues associated with Maintenance.     d.   Revenues
— Software License and/or Appliance Revenues, Services Revenues and Maintenance
Revenues.

  3.   Plan Year — FY11 (May 1, 2010 — April 30, 2011)

  A.   COMMISSION VESTING AND PAYMENTS

Plan participants are eligible to earn Commissions in addition to base salary.
All compensation (including Commissions) described herein are subject to
withholding and other applicable taxes.

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ADDITIONAL TERMS

  1.   Payout. Commissions are payable at the end of each month for all Revenues
from the prior month.     2.   Termination of Employment. Upon termination of
employment, a Plan participant will be paid only Commissions earned (as
described above under “Commission Vesting and Payments”) for Revenues recognized
by the Company through the date of termination. No Commissions will be paid for
Revenues recognized by the Company after the date of termination. Commissions
that are earned at the time of termination will be paid no later than the last
day of the month following the month in which the termination becomes effective.
    3.   Dispute Resolution. Disagreements or disputes between ArcSight and any
Plan participant arising out of or relating to interpretation or implementation
of this Plan, calculation of Commissions shall be submitted to ArcSight’s CFO
and CEO, acting together, for resolution. The CFO and CEO, acting together,
shall decide the issue in their sole discretion. Such decision will be final and
binding.     4.   Modifications. The Company can modify Exhibit A and Exhibit B
of this Plan upon 20 days’ written notice to applicable sales team members.    
5.   Reconciliation of Negative Commission Balances. If a payment by the Company
results in a negative Commission balance, the negative balance will carry
forward and will be offset against future earned Commissions until the negative
balance is eliminated.         In the event that a negative balance exists upon
termination, (i) such a balance constitutes a debt to ArcSight for which the
Plan participant remains fully responsible to repay; (ii) ArcSight will deduct
the balance from the Plan participant’s final paycheck to the extent allowed by
law; and (iii) if the deduction from the final paycheck is insufficient to cover
the balance, the Plan participant will be responsible to pay back any remaining
balance to ArcSight.     6.   Ethical and Legal Standards.

  1.   No employee may pay, offer to pay or give any of their incentive
compensation or anything else of value to any reseller, agent, customer or
representative of the customer or any other person as an inducement or reward
for assistance in obtaining a sale or retaining a customer relationship.     2.
  Gifts and entertainment above a nominal amount shall not be given to
customers, agents or representatives except in accordance with ArcSight’s
Travel, Entertainment and General Expense Policy, the Code of Business Conduct
and Ethics, the Legal Compliance Policy, the Policy Regarding Improper Influence
of Foreign Officials and the Policy and Rules of Conduct for Doing Business with
the Government.

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  3.   No ArcSight employee shall enter into any understanding, agreement, plan
or scheme, express or implied, formal or informal, with any competitor in regard
to prices, terms, or conditions of sales, distribution, territories or
customers, nor engage in any other conduct which may violate any of the
antitrust and/or trade regulation and/or practices.     4.   Sales personnel are
bound by and must comply at all times with ArcSight’s policies and procedures
for entering into business arrangements with customers, vendors, and other third
parties. ArcSight contracts with customers and other parties through formal,
written agreements. No ArcSight employee shall enter into a side agreement with
any third parties, including customers and vendors.     5.   Eligibility for
Commissions is conditioned upon full adherence by Plan participants with
ArcSight’s policies and procedures regarding conflicts of interest and ethical
and legal standards. Any failure to comply with such policies and laws will
result in the denial or recovery of a Commission, and will subject the
salesperson to further disciplinary action, up to and including termination.

  7.   No Effect on Employment. This Plan is not intended to and does not in any
way alter the at-will nature of U.S. salespersons’ employment with ArcSight or
the employment agreements in effect outside the U.S., nor does it constitute a
guarantee of employment for a specified period. Employment with ArcSight in the
U.S. is at will, which means that either the salesperson or ArcSight may
terminate the employment relationship at any time, with or without cause or
prior notice.     8.   Confidentiality. This Plan is deemed confidential
information of the Company to the fullest extent allowed by law.     9.   Entire
Agreement; Effective Date. This Plan constitutes the entire agreement between
ArcSight and the Plan participant identified herein with respect to the subject
matter hereof, and it supersedes all prior negotiations and agreements, whether
written or oral, relating to such subject matter. This Plan is effective from
the later of May 1, 2010 or a Plan participant’s start date and will apply only
to Commissions relating to Revenues that occur during the Plan Year. ArcSight
will have no obligation to pay any Commissions for Revenues that are not earned
by April 30, 2011.