Exhibit 10.1

 

 

 

 

Aspen Technology, Inc.

 

 

 

 

 

Executive Annual Incentive Bonus Plan

 

 

 

FY 2016

 

For

 

“NAME”

 

I.                    Purpose

 

The purpose of Aspen Technology’s (“Company”) Executive Annual Incentive Plan
(the “Plan”) is to motivate and reward performance that results in the
achievement of key Company objectives.  Awards made pursuant to this Plan are
intended to constitute Performance Cash Awards under the 2010 Equity Incentive
Plan.

 

II.                Effective Date of Plan

 

The Plan operates on a fiscal year basis (“Plan Year”), and is effective from
the first business day of the fiscal year, through the last business day of the
fiscal year.

 

III.            Eligibility

 

Eligibility is afforded to those Executives whose positions are determined by
Aspen Technology to have significant impact on the operating results of the
Company.

 

Eligibility for the Plan does not guarantee payment of an award and does not
guarantee continuation of employment.  If employment ends prior to the end of
the performance period any payment eligibility is subject to the Executive
Retention Agreement then in force. Should an Executive voluntarily resign after
the completion of the performance period, he/she is eligible to receive the
earned bonus in accordance with the Plan.

 

In FY 2016, there is potential for a mid-year payment as well as a final
year-end payment. To qualify for a mid-year payout, Executives must have been
employed prior to October 1, 2015.  Executives who start employment after
October 1, 2015 will not receive a mid-year payment, but will receive a
pro-rated bonus payment calculated based on the months worked for the fiscal
year if final year end payments are made to all employees. To qualify for a
year-end payout, executives must have been employed continuously since prior to
April 1, 2016. Payment will be calculated on the number of months worked for the
entire fiscal year if final year end payments are made to all employees. If the
Executive works for 15 or more days of the month, he/she will receive credit for
time worked for that month for any bonus payout. If he/she works for less than
15 days of the month, they will not receive credit for time worked for that
month.

 

 

 

 

1

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

IV.           Target Award

 

The Plan is based on the “Target Award” concept, which bases the award on the
Company’s overall performance.  In order to achieve the Target Award amount, the
Company must achieve 100% of its pre-established objectives by the end of the
Plan Year. The actual award paid to the participant, if any, for a given Plan
Year will be based on the Company’s overall performance, as adjusted for the
overall level of bonus pool funding.

 

The Target Award for each position is the incentive award as defined when 100%
of all Plan objectives are met and the Company attains the necessary level of
performance to fund the bonus pool at 100%.

 

V.               Components of Award

 

“Company Metric Performance” for Plan purposes is based on the accomplishment of
one or more predetermined annual Company financial objectives, selected each
year based on their critical importance to the Company’s success.  Company
Metric Performance for FY 2016 will be measured based on the achievement of the
FY 2016 Growth in License Annual Spend “GLAS”, and Corporate Operating Income.

 

The following summarizes the weighting for the various incentive components for
FY 2016.

 

 

 

 

 

 

 

FY 2016 Plan Components

Overall Bonus 
Weighting

On Target Metric

 

 

 

 

Growth in License Annual Spend

50%

Determined by the Board

 

 

 

 

Corporate Operating Income

50%

Determined by the Board

 

 

 

 

Company Metric Performance (Growth in License Spend & Corporate Operating
Income)

 

The achievement level will then correspond to a bonus plan funding/weighting
percentage by individual metric according to the following table:

 

 

 

 

Company Metric
Performance

Funding Level of Metric
Based on Performance

 

 

 

 

< 70% of Target

0%

 

 

 

 

70% of Target

50%

 

 

 

 

80% of Target

70%

 

 

 

 

90% of Target

90%

 

 

 

 

100% of Target

100%

 

 

 

 

The funding is based on a minimum achievement of 70% of the target metric.  At
70% achievement, the plan funds at 50% of target and increases at a 2:1 ratio
until 89% achievement.  Achievement between 90% and 100% funds at a 1:1 ratio. 
Each metric is measured and funded independently. This Plan is capped at 100%
funding.

 

VI.           Plan Funding Allocation and Achievement

 

For FY 2016, Plan funding is based on the attainment of Board-approved specified
levels of Growth in License Annual Spend and Corporate Operating Income.  In
FY16 there is a potential for a mid-year payment. The mid-year payment is based
on mid-year performance against mid-year targets and will not exceed 25% of the
annual bonus target.

 

 

 

 

2

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

The year-end payment is based on total annual performance against the annual
performance targets less any payment received at mid-year.

 

Should the mid-year bonus earned be less than the target of 25% of bonus
potential, the unrealized difference (up to the 25% mid-year potential) can be
made up at year-end based on annual achievement against annual goals.

 

VII.  Bonus Calculation

 

A.           Bonus calculation takes into account three components:

·                  Growth in License Annual Spend and corresponding funding
percentage (Section V);

·                  Corporate Operating Income  and corresponding funding
percentage (Section V); and

·                  Target Bonus ($) level (as defined in Appendix A).

 

B.           The bonus will be measured on first half performance at mid-year
and on annual performance at year end.

 

First Half (H1) Calculation (Maximum payout of 25% of annual bonus target)

 

 

 

 

 

 

Growth in License Annual Spend

 

 

Annual Bonus Target

X

Metric Weighting 50%

X

Maximum Payout 25%

X

Mid-Year Funding Level Based on Performance (%)

=

H1 Growth in License Annual Spend Bonus Payout

 

 

Corporate Operating Income

 

 

Annual Bonus Target

X

Metric Weighting 50%

X

Maximum Payout 25%

X

Mid-Year Funding Level Based on Performance (%)

=

H1 Corporate Operating Income Bonus Payout

 

 

Total H1 Bonus

 

 

H1 Growth in License Annual Spend Bonus Payout

 

+

 

H1 Corporate Operating Income Bonus Payout

=

Total H1 Bonus Payout

 

 

 

 

End of Year (YE) Calculation

 

 

 

Growth in License Annual Spend

 

 

Annual Bonus Target

X

Metric Weighting 50%

X

Full Year Funding Level Based on Performance (%)

-

H1 Earned

=

YE Growth in License Annual Spend Earned Bonus

 

 

Corporate Operating Income

 

 

Annual Bonus Target

X

Metric Weighting 50%

X

Full Year Funding Level Based on Performance (%)

-

H1 Earned

=

YE Corporate Operating Income Earned Bonus

 

 

YE Bonus Funding

 

 

Growth in License Annual Spend Earned

+

YE Corporate Operating Income Earned

=    Total YE Bonus Payout

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

Illustration

 

The following illustrations demonstrate sample calculations for determining
potential bonus payments using an annual bonus potential of $100,000.

 

H1 Bonus Calculation

 

 

Category

Metric

Weighting

Annual

Bonus

Target

Maximum

Payout %

H1 Target

Award

Mid-Year

Company

Metric

Performance

Mid-Year

Funding Level

Based on

Performance

(%)

H1

Bonus

Payout

 

 

Growth in License Annual Spend

50%

$50,000

25%

$   12,500

90%

90%

$11,250

 

 

Corporate Operating Income

50%

$50,000

25%

$   12,500

70%

50%

$ 6,250

 

 

H1 Total

 

 

 

 

 

 

$17,500

 

 

 

End of Year Calculation

 

 

Category

Metric

Weighting

Annual

Bonus

Target

Full Year

Company

Metric

Performance

Full Year Funding

Level Based on

Performance (%)

Full Year

Bonus

Achievement

Minus H1

Payout

YE

Bonus

Payout

 

 

Growth in License Annual Spend

50%

$50,000

80%

70%

$35,000

$11,250

$23,750

 

 

Corporate Operating Income

50%

$50,000

100%

100%

$50,000

$6,250

$43,750

 

 

 

 H2 Total

$67,500

 

 

 

 H1 Total

$17,500

 

 

 

Full Year Total

$85,000

 

 

 

% of Annual Bonus Target

85.00%

 

 

 

Note: All Actual Plan awards will be adjusted up/down based on Company bonus
pool funding levels.

 

VIII. Discretionary Variation

 

In addition to awards based on the performance metrics established herein and
notwithstanding any limitations (including caps) set forth elsewhere herein, the
Compensation Committee of the Board of Directors may make discretionary awards
to eligible employees in such amounts as the Committee determines are
appropriate and in the best interests of the Company.

 

In addition, the CEO (in the case of his direct reports) and the Compensation
Committee (in the case of the CEO) may reduce any award otherwise payable
hereunder by up to 10 percent in his or its discretion to any of said direct
reports or to the CEO, as the case may be.

 

 

 

 

 

 

4

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

IX.           Administration

 

Administration of this Plan will be the responsibility of the CEO and the
Compensation Committee of the Board of Directors. Any interpretation of the
terms, conditions, goals, or payments from this Plan required because of a
dispute will be made by the CEO and the Compensation Committee in the case of a
dispute relating to employees other than the CEO, and by the Compensation
Committee in the case of a dispute relating to the CEO.

 

If any term or condition of this Plan is found to contravene applicable law,
that term or condition will be interpreted such that it comports with applicable
law to the extent possible.

 

Eligibility and participation in this Plan in no way implies or reflects any
guarantee or contract of employment, except as may be provided by applicable
law.  The Company reserves the right to amend, modify, or terminate this Plan
and the procedures set forth herein at any time.  Any change to the terms of the
Plan will be communicated to participants in advance of the effective date of
such change, and will be subject to acceptance by the affected participant.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

[g162001kq05i001.gif]

Appendix A

 

 

 

 

Employee’s Name:

Manager’s Name:

Antonio Pietri 

Organization:

Date Prepared:

FY16 Compensation

Base Salary: $

Bonus Target: $

OTE: $

 

 

 

 

 

 

Employee

 

 

Signature :

 

 

Date:

 

 

 

 

 

CEO

 

 

Signature :

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6

 

 

 

 

--------------------------------------------------------------------------------