Document:

Exhibit 10.7

 

 

 

 

 

 

 

 

 

 

 

 

 

SendGrid, Inc. 
 2016 VP Bonus Plan

 

 

 

 

 

 

SendGrid, Inc. Confidential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SendGrid, Inc.
 2016 VP Bonus Plan

 

 

Adopted Effective January 1, 2016

 

PROGRAM OBJECTIVES

 

We believe it is important to tie our compensation to individual and company performance.  The 2016 VP Bonus Plan (the “Bonus Plan”) provides an opportunity whereby certain employees (a “Participant”) may be eligible to receive a bonus (a “Bonus”) based on a combination of the Participant’s Individual Performance and the Company’s Performance.

 

ELIGIBILITY

 

Participants are eligible to participate in the Bonus Plan as determined by the Chief Executive Officer. The Participant must be employed and in good standing on the date of the Target Bonus payment to be eligible for any portion of the Target Bonus and must execute the Participation Agreement attached hereto as Exhibit A.

 

BONUS PLAN CYCLE

 

The effective date of this Bonus Plan is January 1, 2016.  Participant’s Target Bonus for the full calendar year shall be as defined in the Participant’s Participation Agreement.  The Target Bonus will be paid on a regular payroll cycle no more than 75 calendar days following the end of the Bonus Period.  For purposes of this Bonus Plan, the Bonus Period is defined as the completion of calendar year 2016.

 

WEIGHTING OF AWARDS

 

Eligibility to receive a Participant’s Target Bonus is based upon a combination Individual Performance, weighted at 20% of Target Bonus, and the Company’s Performance (defined below), weighted at 80% of Target Bonus for the Bonus Period.

 

INDIVIDUAL PERFORMANCE

 

The Individual Performance Achievement of the potential Target Bonus shall consist of demonstrable activity of both competencies and responsibilities resulting in the following ratings.

 

	
Rating
    	
Description
    	
% of Target
   Bonus
    
	
1 - Insufficient
    	
Objectives were not achieved and the   outcomes were poor
    	
0%
    
	
2 - Below Expectations
    	
Objectives were not quite achieved   and the results were below expectations
    	
<10%
    
	
3 - Good
    	
Objectives were achieved and the   results were what was expected
    	
20%
    
	
4 - Great
    	
Objectives were achieved and the   results were beyond expectations
    	
Discretionary
    
	
5 - Amazing
    	
Objectives were achieved and the   results were truly outstanding
    	
Discretionary
    

 

COMPANY PERFORMANCE

 

The Company Performance Achievement of the potential Target Bonus shall consist of an array of metrics that reflect our Enduring Measures of Success to include:  1. Customer Satisfaction, 2. Employee Engagement, 3. Innovation, 4. Revenue growth and 5. Profitability. Annualized recurring revenue (“ARR”) is calculated by multiplying the Q4 2016 recurring revenue by four (4).

 

1.

 

	
Enduring Measure
   Connection
    	
Metric
    	
2016 Plan
   ($MM)
    	
 

% of Target Bonus
   @ 100%
   Achievement

 
    
	
 

Financial

 
    	
Revenue (GAAP)
    	
$76.5
    	
12.50%
    
	
 

Financial

 
    	
ARR (Q4)
    	
$85.5
    	
12.50%
    
	
 

Financial

 
    	
2H Adjusted NI
    	
$0.5
    	
25%
    
	
 

Customer

 
    	
NPS
    	
42
    	
10%
    
	
 

Employee Engagement

 
    	
Engagement %
    	
75
    	
10%
    
	
 

Innovation

 
    	
ARR from New Products
    	
$8.3MM
    	
10%
    

 

2016 REVENUE PAYOUT MATRIX

 

	
 

2016 Revenue Goals ($MM)

 
    	
 
    	
 
    	
 
    	
 
    
	
 

 

 
    	
Range
    	
Low
    	
Base
    	
High
    
	
 

Revenue   (GAAP)

 
    	
(20%)   to +20%
    	
$61.20
    	
$76.50
    	
$91.80
    
	
 

ARR   (Q4)

 
    	
(10%)   to +10%
    	
$76.95
    	
$85.50
    	
$94.05
    

 

	
 

Revenue-related Goals Payout   Matrix

 
    	
 
    	
 
    	
 
    
	
 

 

 
    	
 
    	
Revenue   (GAAP)
    
	
 
    	
 
    	
 

Low

 
    	
Base
    	
High
    
	
ARR   (Q4)
    	
 

Low

 
    	
80%
    	
85%
    	
90%
    
	
 

Base

 
    	
85%
    	
100%
    	
105%
    
	
 

High

 
    	
90%
    	
115%
    	
120%
    

 

	
 

OTHER VARIABLE COMP ELEMENTS PAYOUT MATRIX

 
    
	
 

 

 
    	
 
    	
Payout Targets
    
	
 

Goal

 
    	
Base Plan
    	
Low (-20%)
    	
Base
    	
High (+20%)
    
	
 

2H   Adjusted NI (MM)

 
    	
$0.50
    	
$0.40
    	
$0.50
    	
$0.60
    
	
 

NPS

 
    	
42
    	
36
    	
42
    	
54
    
	
 

Engagement

 
    	
75
    	
60
    	
75
    	
90
    

 

	
 

Goal

 
    	
 
    	
Payout %
    
	
 

2H   Adjusted NI

 
    	
 
    	
80%
    	
100%
    	
120%
    
	
 

NPS

 
    	
 
    	
80%
    	
100%
    	
120%
    
	
 

Engagement

 
    	
 
    	
80%
    	
100%
    	
120%
    

 

2.

 

	
Goal
    	
Base Payout
    	
Payout % of Total Variable in 2016
    
	
2H Adjusted NI
    	
25%
    	
20%
    	
25%
    	
30%
    
	
NPS
    	
10%
    	
8%
    	
10%
    	
12%
    
	
Engagement
    	
10%
    	
8%
    	
10%
    	
12%
    

 

Zero (0) payout below 80% achievement and capped payout above 120% achievement.  If results fall between levels then the respective Bonus percentage will be calculated based on linear interpolation.

 

MISCELLANEOUS

 

This Bonus Plan supersedes any and all other bonus plans that may have been discussed prior to the effective date of this Bonus Plan.

 

Eligible employees starting in their position after July 1st may or may not have their Target Bonus prorated.  Determination of proration is at the discretion of the CEO and/or the Company’s Board of Directors.

 

Participants who were on a leave of absence 30 or more days during the Bonus Plan period are eligible for a prorated Target Bonus consideration.

 

The Company reserves the right to amend, discontinue or rescind this Bonus Plan at any time and /or add, reduce or limit the amount of any Bonus payments or to limit the number of participants any time such actions are deemed appropriate and in the best interest of the Company.

 

The Bonus Plan is intended to provide a financial incentive to Participants and is not intended to confer any rights to continued employment upon Participants whose employment will remain at-will and subject to termination by either the Company or Participant at any time, with or without cause or notice.

 

The rights and obligations of a Participant under the Bonus Plan will be governed by and interpreted, construed and enforced in accordance with the laws of the State of Colorado without regard to its or any other jurisdiction’s conflicts of laws principles.

 

The Bonus Plan and the executed Participation Agreement set forth all of the agreements and understandings between the Company and Participant with respect to the subject matter hereof, and supersedes and terminates all prior agreements and understandings between the Company and Participant with respect to the subject matter hereof.

 

3.

 

EXHIBIT A

 

SENDGRID, INC.
 2016 VP BONUS PLAN
 PARTICIPATION AGREEMENT

 

This Participation Agreement (the “Participation Agreement”) is entered into by and between SendGrid, Inc., a Delaware corporation (the “Company”), and the undersigned employee of the Company (“Participant”), as of the date set forth below.

 

This Participation Agreement is attached to a copy of the 2016 VP Bonus Plan (the “Plan”).  Each capitalized term not defined in this Participation Agreement will have the meaning ascribed to such term in the Plan.

 

The Board has designated you a Participant in the Plan.  You are encouraged to read the Plan in its entirety.  The final decision as to whether you have earned any payments under the Plan will be made by the Board or the Representative in accordance with the Plan.

 

Participant’s total Target Bonus for 2016 shall be 25% of earned base salary (“Target Bonus”).

 

In consideration of your eligibility to participate in the Plan as a Participant, a benefit to which you are not otherwise entitled, you hereby agree, to the greatest extent permitted by law, and to the extent applicable, to the following terms of the Plan:

 

1.                                     You must continue to be a satisfactory performer as determined by your manager.

 

2.                                     This Participation Agreement does not constitute a guarantee of a specific period or term of employment and does not constitute an employment contract.  Your employment remains “at will”, and you continue to be subject to all company policies and guidelines.

 

3.                                     SendGrid reserves the right to change, eliminate or replace all or parts of the Plan at will at any time, with or without notice, to adjust targets, objectives, to terminate the Plan or make any other adjustments and changes deemed appropriate.

 

4.                                     This Participation Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Participation Agreement and the Participation Agreement shall not be modified or rescinded, except by a written Participation Agreement signed by SendGrid, Inc. and you.  The provisions of this Agreement supersede all prior and contemporaneous discussions, writings and understandings of the parties with respect to the subject matter of this Participation Agreement.

 

To indicate your acceptance of your designation as a Participant in the Plan, please sign a copy of this Participation Agreement in the space indicated below.

 

 

 

	
 
    	
 
    	
 
    
	
Name
    	
 
    	
Sameer   Dholakia, CEO for SendGrid, Inc.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date
    	
 
    	
Date
    

 

4.Exhibit 10.8

 

SENDGRID, INC.

 

SENIOR EXECUTIVE CASH INCENTIVE BONUS PLAN

 

1.                                      Purpose.  This Senior Executive Cash Incentive Bonus Plan (the “Incentive Plan”) is intended to provide an incentive for superior work and to motivate eligible executives of SendGrid, Inc. (the “Company”) and its subsidiaries toward even higher achievement and business results, to tie their goals and interests to those of the Company and its stockholders and to enable the Company to attract and retain highly qualified executives. The Incentive Plan is for the benefit of Covered Executives (as defined below).

 

2.                                      Covered Executives.  From time to time, the Board (as defined below) may select certain key executives (the “Covered Executives”) to be eligible to receive bonuses hereunder.

 

3.                                      Administration.  The Plan shall be administered by the Board of Directors of the Company (the “Board”) or, at the discretion of the Board, such administrative authority may be delegated to the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”).  All references herein to the “Board” shall be deemed to refer to the group then responsible for administration of the Incentive Plan at the relevant time (i.e., either the Board or the Compensation Committee, as applicable).  The Board shall have the sole discretion and authority to administer and interpret the Incentive Plan.

 

4.                                      Bonus Determinations.

 

(a)                                 Performance Goals. A Covered Executive may receive a bonus payment under the Incentive Plan based upon the attainment of one or more Performance Goals approved by the Board.  As used herein, the term “Performance Goals” means the goal(s) (or combined goal(s)) determined by the Board, in its sole discretion, to be applicable to a Covered Executive.  The Performance Goals may differ from Covered Executive to Covered Executive.

 

(b)                                 Calculation of Performance Goals. At the beginning of each applicable performance period, the Board will determine whether any significant element(s) will be included in or excluded from the calculation of any Performance Goal with respect to any Covered Executive. In all other respects, Performance Goals will be calculated in accordance with the Company’s financial statements, generally accepted accounting principles, or under a methodology determined by the Board.

 

(c)                                  Bonus Requirements; Individual Goals. Except as otherwise set forth in this Section 4(c):

 

(i)                                     any bonuses paid to Covered Executives under the Incentive Plan shall be based upon objectively determinable bonus formulas that tie such bonuses to one or more performance criteria relating to the Performance Goals,

 

(ii)                                  bonus formulas for Covered Executives shall be adopted in each performance period by the Board and communicated to each Covered Executive at the beginning of each performance period, and

 

 

(iii)                               no bonuses shall be paid to Covered Executives unless and until the Board makes a determination with respect to the attainment of the performance criteria to the Performance Goals. Notwithstanding the foregoing, the Board may adjust bonuses payable under the Incentive Plan based on achievement of one or more individual performance objectives or pay bonuses (including, without limitation, discretionary bonuses) to Covered Executives under the Incentive Plan based on individual performance goals and/or upon such other terms and conditions as the Board may in its discretion determine.

 

(d)                                 Individual Bonuses. The Board shall establish a bonus opportunity for each Covered Executive for each performance period. For each Covered Executive, the Board shall have the authority to apportion the award so that a portion of the award shall be tied to attainment of Performance Goals and a portion of the award shall be tied to attainment of individual performance objectives.

 

(e)                                  Employment Requirement. Unless otherwise expressly provided in a written agreement between the Covered Executive and the Company, the payment of a bonus to a Covered Executive with respect to a performance period shall be conditioned upon the Covered Executive’s continued employment by the Company through the end of the performance period. If a Covered Executive was not employed for an entire performance period, the Board may pro-rate the bonus based on the number of days employed during such performance period.

 

5.                                      Timing of Payment

 

(a)                                 With respect to Performance Goals established and measured on a basis more frequently than annually (e.g., quarterly or semi-annually), the Performance Goals will be measured at the end of each performance period after the Company’s financial reports with respect to such period(s) have been published. If the Performance Goals and/or individual goals for such period are met, payments will be made as soon as practicable following the end of such period, but not later 74 days after the end of the fiscal year in which such performance period ends.

 

(b)                                 With respect to Performance Goals established and measured on an annual or multi-year basis, Performance Goals will be measured as of the end of each such performance period (e.g., the end of each fiscal year) after the Company’s financial reports with respect to such period(s) have been published. If the Performance Goals and/or individual goals for any such period are met, bonus payments will be made as soon as practicable, but not later than 74 days after the end of the relevant fiscal year.

 

(c)                                  For the avoidance of doubt, bonuses earned at any time in a fiscal year must be paid no later than 74 days after the last day of such fiscal year.

 

6.                                      No Guarantee of Employment.  The Incentive Plan is intended to provide a financial incentive to Covered Executives and is not intended to confer any rights to continued employment upon Covered Executives whose employment will remain at-will and subject to termination by either the Company or Covered Executive at any time, with or without cause or notice.

 

2

 

7.                                      Recovery.  Any amounts paid under this Incentive Plan will be subject to recoupment in accordance with any clawback policy that the Company is required to adopt pursuant to the listing standards of any national securities exchange or association on which the Company’s securities are listed or as is otherwise required by the Dodd-Frank Wall Street Reform and Consumer Protection Act or other applicable law.  No recovery of compensation under such a clawback policy will be an event giving rise to a right to resign for “good reason” or “constructive termination” (or similar term) under any plan of or agreement with the Company.

 

8.                                      Amendment and Termination.  The Company reserves the right to amend or terminate the Incentive Plan at any time in its sole discretion.

 

3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00275-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00275-of-00352.parquet"}]]