EXHIBIT 10.1

 

HIRERIGHT, INC.

 

2008 EXECUTIVE SHORT-TERM INCENTIVE PLAN

Revised Feb 13, 2008

 

HireRight’s objective with respect to executive compensation is to establish
programs which attract, retain and motivate talented and qualified executives
and align their compensation with our overall business strategies, values and
performance. The primary objective of the Executive Short-term Incentive Plan
(“Plan”) is to drive and reward increased stockholder value achieved through
meeting or exceeding the 2008 financial and customer satisfaction objectives.

 

Eligibility

 

Participants in the Plan are the Chief Executive Officer (“CEO”) and those
HireRight executives reporting directly to the CEO in a leadership capacity over
a HireRight department or division and other key executives as approved by the
Compensation Committee of the HireRight Board of Directors (“Committee”).

 

HireRight executives must have commenced work in an eligible position prior to
the beginning of the fourth quarter and remain employed with HireRight until the
day the bonus is paid to be eligible.  Bonuses for associates who become
eligible during the year will be adjusted on a pro-rated basis.  Bonuses for
executives who receive a promotion to a position with a higher bonus target
during the year will be adjusted on a pro-rated basis consistent with the time
in each position.  Bonuses for executives who are on medical, family or other
leave during the year will be adjusted on a pro-rata basis consistent with their
time worked during the year.

 

ADMINISTRATION

 

THE COMMITTEE WILL APPROVE THE PLAN.  THE COMMITTEE WILL APPROVE THE ANNUAL
FINANCIAL TARGETS UNDER THE PLAN.

 

Bonuses under the Plan, if any, will be paid after the end of the 2008 fiscal
year and between January 1, 2009 and March 15, 2009.  Bonus payments will be
based on HireRight’s achievement of its financial goals and customer
satisfaction results.  All payments under the Plan are subject to the sole
discretion of, and must be approved by, the Committee.  Accordingly, each
individual’s subjective personal contribution may be taken into account by the
Committee, based upon input from the CEO. The Committee, with input from the
full HireRight Board of Directors, will determine the CEO’s bonus payment.

 

The Committee will evaluate the Plan for effectiveness and modify as
appropriate.  The Plan is subject to change or cancellation from quarter to
quarter at the sole discretion of the Committee.

 

Target Incentives

 

Short-term Incentive Targets are determined based on a percentage of base salary
consistent with competitive market variable compensation targets.  The following
bonus targets are applicable under the Plan:

 

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Position

 

Annual Target as % 
of Base Salary

 

CEO

 

80

%

VP, Worldwide Sales

 

60

%

Other Plan Participants

 

35

%

 

Metrics

 

The potential bonus for all participants will be based on HireRight’s results
for the following metrics:  40% on operating income, 25% on fully diluted
earnings per share, 20% on service revenue, and 15% on customer satisfaction.

 

Metrics Definitions and Targets

 

THE FOLLOWING DEFINITIONS DESCRIBE THE METRICS UPON WHICH THE PLAN IS BASED.

 

Operating Income – Operating Income is measured by the extent to which HireRight
has met its stated operating income plan for the quarter and the year as
described in HireRight’s annual operating plan.  The Board of Directors and
executive management establish the operating income plan at the beginning of
each fiscal year.

 

Earnings per Share – Earnings per share is measured by the extent to which
HireRight has met its stated fully diluted earnings per share plan for the
quarter and the year as described in HireRight’s annual operating plan.  The
Board of Directors and executive management establish the earnings per share
plan at the beginning of each fiscal year.

 

Revenue – Revenue is measured by the extent to which HireRight has met its
stated service revenue plan for the quarter and the year as described in
HireRight’s annual operating plan.  The Board of Directors and executive
management establish the revenue plan at the beginning of each fiscal year.

 

Overall Customer Satisfaction - An outside firm will conduct a quarterly survey
of a sampling of HireRight’s customer base to measure customer satisfaction. 
The areas addressed in the survey are developed in consultation with our survey
provider and are focused on supporting our objective of customer retention.

 

Bonus Pool Funding

 

Operating Income:  The operating income portion may be funded to the extent
HireRight can still meet its planned operating income for the quarter.

 

Earnings per Share:  The earnings per share portion may be funded to the extent
HireRight can still meet its planned earnings per share plan for the quarter.

 

Revenue:  The revenue portion of the Plan may be funded as follows:

 

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Revenue Plan 
Achievement

 

100%

 

98% to 
99.9%

 

96% to 
97.9%

 

94% to 
95.9%

 

Less 
than 
94%

 

Funding %

 

100

%

75

%

50

%

25

%

0

%

 

Overall Customer Satisfaction:  The overall customer satisfaction portion may be
funded based on the results of the quarterly customer satisfaction survey.

 

Provided that HireRight achieves its annual targets, the Committee may, in its
sole discretion, make up any quarterly funding shortfall at the time of the
annual bonus payment.

 

Over Achievement Bonus

 

In the event HireRight exceeds its annual operating income target, up to 15% of
the excess operating income may be granted to the participants in the Plan at
the discretion of the Committee.  The amount of the over achievement bonus
payable to each participant is completely discretionary and is recommended by
the CEO (for participants other than himself) and subject to the approval of the
Committee.  The Committee, with input from the full HireRight Board of
Directors, will determine the CEO’s over achievement bonus payment.  In no event
will an individual’s over achievement bonus exceed two times his or her annual
target bonus amount.

 

Bonus Calculation

 

The final bonus calculation and payment amount, if any, will be determined once
HireRight’s annual results are finalized.  The bonus will not be deemed earned
until after the end of the fiscal year, and the participant must be an active
employee at the time bonus is paid in order to be eligible for the payment.

 

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