Exhibit 10.14


 


PHASE
FORWARD INCORPORATED


 


 


2008


Global
Sales Executive Incentive


Compensation
Plan


 


 


 


 


Effective
Date January 1, 2008


 


 

















 


 


Phase
Forward


2008
Global Sales Executive


Incentive
Compensation Plan


Effective:  January 1, 2008






1)             Purpose:


 


The Phase Forward
Incorporated (“Phase Forward” or the Company”) 2008 Global Sales Executive
Incentive Compensation Plan (the “Plan”) is established to incent and reward
the Participant to achieve certain Company sales and financial goals. The base
salary and incentive opportunity outlined in this Plan are intended to reward
the Participant with total cash compensation that is equal to or above what is
paid for similar positions by similar companies upon achievement of the
expected level of performance.


 


2)             Effective Date:


 


This Plan is effective on
January 1, 2008 and applies to all Orders entered into between January 1,
2008 and December 31, 2008 and supersedes all plans and terms previously
in effect.


 


3)             Participation:


 


Global Sales Executives
who are eligible to participate (each, a “Participant”) will receive a plan
document with a personalized schedule as Attachment A.


 


4)             Definitions and Compensation
Guidelines:


 


(a) Base Salary


The Participant’s base
salary is a fixed amount that is determined by the Management Development and
Compensation Committee in its discretion who will take into consideration the
competitive market, qualifications for the position, and past performance.  The base salary is paid in accordance with
the Company’s normal payroll practices. 
No other “annual reviews” or other salary adjustments will occur for
Participants during the course of the fiscal year.


 


(b) Orders


An “Order” is defined as
a firm legal commitment for the value (amount) 
recorded (booked) in the backlog of the Company, for the delivery of
software, service, support or product with specified delivery dates, signed by
both parties and received at the Company’s headquarters.


 


(c) Bonus Eligible Orders


These are Orders that are accepted by the Company, net of pass-through
items , in the following categories:


·                  Software licenses: software fees or usage fees relating to
any Phase Forward products.


·                  Services:


o                 ASP Services: study preparation, eCRF design, server hosting, CDD
formatting, provisioning, site assessment, custom reports, and other related
services that the Company may offer from time to time.


o                 Consulting Services:  project
management, training, integration services, custom reports.


·                  Customer Support:


o                 Maintenance and customer support agreements for
software transactions.


o                 Server hosting, help desk.


 


(d) Accrued Bonus


For Bonus Eligible Orders
that are fixed in nature, a bonus is accrued upon acceptance of the Order by
the Company. For Bonus Eligible Orders that are variable in nature, such as
estimated usage fees or future 


 


 


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service commitments, bonus is accrued at the time the
Order becomes fixed (as usage occurs or committed amount is fixed and
determinable).


 


         (e) Pass-Through
Items


“Pass-through items” refer to third-party products, referral or similar
fees paid by the Company to third parties, services, hardware and associated
items provided and/or sold to a customer at cost or with minimal markup.  Pass-through items are not compensated for
under this Plan. Service fees associated with pass-through items are eligible
for compensation.


 


         (f) Negative Booking


A “Negative Booking” is a change to an Order which results in the
reduction of the net amount of an Order, the reversal of previously recognized
revenue, the uncollectability of an account receivable related to previously
recognized revenue, or an indication of hold status or suspension for a period
greater than six  months. Bonuses paid
that subsequently have events which result in a Negative Booking will have a
reversal in payment in the month or months following the year they become a
negative booking until full repayment is achieved.  Negative Bookings will be reversed at the
bonus amount that was applied at the time of the Order, and only for the
original sales executive paid.


 


5)     Sales Quota:


 


Annual quotas will be set for each Participant in this Plan. Any Orders
that will not generate revenue within six months of signing will not count
towards the quota retirement, unless such deals were envisioned in the original
annual commit list which was created in conjunction with the Company’s 2008
operating plan or were pre-approved by the Plan administrator(s).  Retirement of quotas will be based on the
value of Bonus Eligible Orders recorded, without deducting for the value of any
third party royalties.


 


6)     Incentive
Payments:


 


The payment schedule and plan components are
outlined on Attachment A.


 


7)    Termination:


 


Upon termination of
employment, voluntary or involuntary, the Participant will be paid the
applicable base salary through the agreed upon termination date.  Any additional payments will be in accordance
with the terms and conditions of any Executive Agreement or Employment
Agreement between the Participant and the Company (or a subsidiary) in effect
at the time of termination. The Participant must also return all Company
documents and property.


 


8)    Administration
and Other Matters:


 


Administration
of this policy will be the responsibility of the Vice President of Finance and
the Vice President of Human Resources of the Company in consultation with the
the CEO. In the case
of a dispute, interpretation of the terms, conditions, goals, or payments from
this Plan will be made solely by the Vice President of Human Resources after a
full review of the facts and input from affected parties. The decision of the Vice President of Human
Resources and the CEO on all matters under this policy will be final, and the
Company reserves the right to amend, modify, or terminate this policy at any
time without notice. Any change will be made in writing as far in
advance as possible, of the effective date of such change. In addition the Company reserves the right to
make adjustments to the policy in its sole discretion in specific instances
based on unusual or special circumstances.


 


If any term or condition
of this Plan is found to be in non-conformance with a given state, federal, or
country law, that term or condition will be non-enforceable but will not negate
other terms and conditions of the Plan. 
However, Phase Forward Incorporated will review and modify the overall
plan to conform to such law.


 


 


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Eligibility and
participation in this Plan in no way infers or reflects any guarantee of a
contract of employment and, except as expressly set forth in any Participant’s
agreement signed by the Company and Participant, all of the employees of the
Company and its subsidiaries are employees “at will”. Participation in this
Plan does not confer any right to continue in Phase Forward’s or its
subsidiaries’ employ or limit the right of Phase Forward or its subsidiaries to
terminate the Participant at any time, with or without cause or notice.


 


Phase Forward
Incorporated is an Equal Opportunity Employer committed to a diverse
workforce.  The Company will not
discriminate on the basis of race, color, religion, age, sexual orientation,
national origin, physical or mental disability, or veteran status.


 


9) Extraordinary Events:


 


Any event deemed
extraordinary by the Vice President of Human Resources or the CEO may result in
changes to the terms and conditions of this Plan, adjustments to quota, changes
in the payment structure and other events up to and including termination of
this Plan, and the creation of a new plan. 
It should not be expected by the Participant that events resulting in a
revenue or bookings windfall would be counted in determining performance as it
relates to the goals and quota and any payments resulting from this may be
appropriately adjusted.


 


10)             Return of Excess Distributions:


 


Notwithstanding any
provision hereof to the contrary, if the Company restates its financial results
for any period covered by this Plan, the Company will re-measure the
achievement of performance targets using the restated financial results.
Following such recalculation, if the aggregate amount of a previously paid
bonus to a Participant identified on Attachment A exceeds the aggregate
amount of his or her bonus actually earned, such excess shall be deemed to
constitute a “bonus overpayment”. The Company shall notify each Participant of
the amount of his or her bonus overpayment as soon as reasonably practical. The
amount of such bonus overpayment shall be, at the Company’s election, either (i) repaid
to the Company by the Participant within 30 days of receipt of the notice of
bonus overpayment or (ii) deducted from the Participant’s future
compensation. The provisions of this section shall survive the termination or
expiration of this Plan.


 


ACKNOWLEDGEMENT AND AGREEMENT


 


I acknowledge that I have read this document,
including the Attachment A, and agree to the terms and conditions of the
Plan.


 




	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
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Attachment
A


 


FY2008 Global Annual Bookings(1) Target
- $[REDACTED]


Steve Powell


 


Compensation Targets


 


	
  Base Salary:

  	
   

  	
  £

  	
  180,000

  	
   

  
	
  Target Bonus:

  	
   

  	
  £

  	
  130,000

  	
   

  
	
  Total Annual Earnings Potential:

  	
   

  	
  £

  	
  310,000

  	
   

  



 


 


Compensation Plan


 


	
  Weight and Component

  	
   

  	
  Earnings Potential

  	
   

  	
  Payment Terms

  
	
  50%: Annual
  Bookings

  	
   

  	
  £65,000

  	
   

  	
  Quarterly
  advance of [75% of annual target divided
  by 4], if 90% of year-to-date bookings targets specified below are
  met, measured following the end of each of the first 3 quarters. True-up will
  occur at year-end to adjust for any over- or underpayments computed in
  accordance with the payment schedule below.

  
	
  50%: Phase Forward
  Profitability

  	
   

  	
  £65,000

  	
   

  	
  Paid Annually
  (in accordance with the Phase Forward 2008 Management Incentive Plan)

  



 


Year-to-date
bookings targets for calculation of quarterly advance:


 


Q1:  [REDACTED]


Q2:  [REDACTED]


Q3:  [REDACTED]


 


Payment
Schedule Annual Bookings Component


 


	
  Achievement
  %

  	
   

  	
   

  
	
  <80%

  	
   

  	
  0

  
	
  >80% - 100%

  	
   

  	
  50% + 2.5% for each %
  achieved

  
	
  >100% -125%

  	
   

  	
  5% of targeted bookings
  comp for each % achieved over 100%

  
	
  >125%

  	
   

  	
  3% for each % achieved
  over 125%

  



 


The maximum payout on
Bookings component is 300% of Target Bonus.


 


 






(1) “Bookings”, as
used herein, refers to Bonus Eligible Orders.


 


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