Exhibit 10.22
(CALLIDUS LOGO) [f28395f2839500.gif]
Executive Incentive Bonus Plan
Overview and Purpose
Callidus’ Executive Incentive Bonus Plan was created as a means to recognize and
reward the link between the achievement of Callidus’ corporate objectives and
the senior executive’s contribution to its success. The plan is designed to
motivate the senior executive team to achieve business targets by placing
compensation “at risk” based on determined target achievement. The specific
purpose of the plan is to:

  •   Align the risks/rewards for the Executive team to achieve Callidus’ top
business priorities, and     •   Motivate and retain senior executive staff by
providing a bonus structure appropriate for their level in the market and to
promote achievement of stretch goals. The plan incorporates Callidus’ annual
business strategy and a desire to motivate, retain and competitively compensate
the senior executive staff based on achievement and/or overachievement of the
annual approved Company Business Plan.

Objective
The Executive Incentive Bonus Plan supports the Callidus compensation philosophy
and guiding principles by meeting several key objectives:

  •   Provide competitive total cash opportunities that help attract, reward and
retain top executives. Target total cash with above market opportunities for
above – plan performance.     •   Create shareholder value by establishing a
direct link between achievement of the business plan and executive rewards.    
•   Create a sense of focus and accountability through the development of
specific and critical targets.     •   Align interests and objectives of
shareholders and the Executive Team to drive Callidus growth and stock
appreciation.

Performance Period
The fiscal year is divided into two, six-month performance periods, January to
June and July to December, for measuring Company performance. Payout is based on
achievement of agreed upon targets established two times each year, typically
January and July.

 

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Eligibility and Participation
Chief Executive Officer and Senior Vice Presidents who are employed at the end
of the performance period are considered eligible to participate and receive an
award under this plan. An executive must be in good performance standing to be
eligible for any award under this plan. Executives who leave during the period
are not eligible for a payout. Exceptions may be made by the CEO with
Compensation Committee’s approval.
Performance Measures
The Plan rewards performance as measured against Callidus’ financial performance
as measured against a pre-defined set of objectives (i.e. Targets) based on
revenue generation and operating income before stock based compensation and
other income. Overall Company performance for Callidus will be measured against
the targets as approved by the Compensation Committee of the Board of Directors.
The Compensation Committee of the Board will select and approve the financial
targets based on the business priorities for the fiscal year. Exhibit A attached
to the Plan provides the approved performance targets for the first operating
period under the plan.
Award Pool Funding
The first step in the process is for the Company to build a funding pool
following the measurement of the company’s performance. This pool is the amount
of total dollars that are available for incentive awards for the executive team.
The Board bases the pool on Callidus’ financial performance for the year against
the key targets approved in the business plan.
The Company must meet a minimum level of performance, referred to as the
threshold, to initiate funding of the financial related pool . Threshold
performance is met when the Company has achieved approximately 85 to 95% of plan
based on the specific financial metrics. Company performance represents 100% of
the funding pool for the plan. For clarification targets must be met after
funding the incentives.
For purposes of illustration, assume that there are 10 executives with identical
earned salaries of $200,000 for the fiscal year. Also assume that the target
award opportunity is 50% of base salary for each position, or $100,000.
Therefore, the executive bonus pool would be $1,000,000 at target Company
performance — i.e. 100% achievement of financial metrics.

  •   Funding and therefore payout is reduced on a pro-rated basis if less than
100% of target is achieved.     •   Funding and payout accelerates based on
overachievement of target.     •   No funding or payout of bonus if less than
85% of target is achieved.     •   No cap on overachievement.

 

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Award Payout by Position
Bonus payout targets are determined and approved at the beginning of the
calendar year by the Compensation Committee of the Board of Directors. The bonus
payouts generally range from 55% - 100% based on position and market analysis.
Award Approval
Upon the close of the second and fourth quarters, the CFO reviews the financial
results against established targets with the CEO and then the Compensation
Committee. Once the financial performance has been reviewed and approved for the
period and if the Company met the window of established target performance for
the period (85%-100%), awards for the 6 month period are distributed. Each
eligible executive has a specific target incentive opportunity that is used to
calculate individual awards as noted above. Calculation is applied to base
salary earned during the period.
Callidus’ Board of Directors maintain the discretion to determine any funding of
the plan if the Company’s performance does not meet the minimum threshold
Administration
Senior Executive must be with Callidus for the entire performance period, and be
in good performance standing during the entire performance period, to be
eligible for an award under the plan. New Hire bonuses would be pro-rated with
Compensation Committee and CEO approval.
Awards will be paid based on standard Payroll deadlines following when final
performance is known for the Company and the Compensation Committee has approved
a payout. Incentive awards are subject to all applicable payroll taxes.
Callidus reserves the right to modify the plan, and individual awards, at any
time. You will be notified of any plan changes.

 

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Acknowledgement
My signature below indicates that I have received a copy of the plan and that my
target incentive opportunity has been communicated to me.

               
 
  Employee Signature   Date
 
       
 
             
 
  Manager Signature   Date