Attached files
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| EX-10.71 - CHORDIANT SOFTWARE INC | ex1071.htm |
| EX-10.72 - CHORDIANT SOFTWARE INC | ex1072.htm |
UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
____________________
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported):
November
19, 2009 (November 18, 2009)
____________________
Chordiant
Software, Inc.
(Exact
Name of Registrant as Specified in Its Charter)
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Delaware
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001-34179
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93-1051328
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification
No.)
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20400
Stevens Creek Boulevard, Suite 400
Cupertino,
California 95014
(Address
of Principal Executive Offices, Including Zip Code)
(408)
517-6100
(Registrant’s
Telephone Number, Including Area Code)
Not
Applicable
(Former
Name or Former Address, if Changed Since Last Report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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[ ]
Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
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[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item
5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On
November 18, 2009, the Board of Directors (the “Board”) of Chordiant Software,
Inc. (the “Company”) decided on fiscal year 2010 compensation for the Company’s
executive team. In light of the continued difficult economic
environment, and the Company’s performance in this environment, the Board, upon
the recommendation of the Compensation Committee, and management, took a number
of additional compensation-related actions for fiscal year 2010. These actions
included revising our peer group, which continues to consist of technology
companies primarily focused on software, to include only companies with
revenues between $50 million and $200 million, which revenue levels and range
are significantly smaller than we have historically utilized. Our CEO
voluntarily agreed to reduce his base salary by 10% and his target bonus
percentage by 5%. Each of our other executive officers who were
executives officers for the full fiscal year voluntarily agreed to reduce their
base salaries by 7.5%. In addition, those executive officers also
voluntarily agreed to reduce their target bonus amounts. In light of the above
reductions, the Board did reinstate 100% payout for 100% performance against
goals under the Company’s Fiscal Year 2010 Executive Incentive Bonus Plan, but
this is not likely to offset the compound effect of reduced base salaries and
reduced target bonuses unless the Company overachieves against the goals in that
plan. Further, the Company has suspended its 401(k) match for all
employees, including our Named Executive Officers, effective January 1,
2010.
Fiscal
year 2010 Cash Compensation Arrangements
The
following compensation arrangements for the executive officers of the Company
were approved, effective as of November 15, 2009:
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Name
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Base
Salary*
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Target
Bonus
Percentage**
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Steven
R. Springsteel
President
and Chief Executive Officer
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$495,000
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95%***
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Peter
S. Norman
Senior
Vice President and Chief Financial Officer
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$277,500
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56%***
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Prashant
K. Karnik
Senior
Vice President and General Manager, Worldwide Client
Services
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$267,100
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60%***
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David
M. Zuckerman
Vice
President, General Counsel and Secretary
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$259,000
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48.5%***
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Raymond
Gerber
Senior
Vice President, Worldwide Engineering and Chief Technology
Officer
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$250,000
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60%***
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Marchai
B. Bruchey
Senior
Vice President and Chief Marketing Officer
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$240,000
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50%***
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*Each
Base Salary (other than the base salaries for Ms. Bruchey, who was a new hire in
2009, and Mr. Gerber, who was promoted to an executive officer in 2009, and
whose compensation arrangements were already aligned with the Company’s new peer
group) has been reduced from applicable 2009 fiscal year base salary amounts as
part of the Company’s efforts to align compensation arrangements more closely to
those reflected in the Company’s new peer group.
**Actual
bonus payments will be determined under the terms of the Chordiant Software,
Inc. Fiscal Year 2010 Executive Incentive Bonus Plan (see below) for Messrs.
Springsteel, Norman and Gerber, and Ms. Bruchey; under the terms of the
Chordiant Software, Inc. Fiscal Year 2010 Senior Vice President and General
Manager Worldwide Client Services Incentive Bonus Plan (see below) for Mr.
Karnik; and under the terms of the Chordiant Software, Inc. Fiscal Year 2010
General Counsel Incentive Bonus Plan (see below) for Mr.
Zuckerman. All such payments are subject to the approval of the Board
of Directors.
***Target
Bonus Percentages (other than Messrs. Gerber’s and Karnik’s, and Ms. Bruchey’s,
target bonus percentages) have also been reduced from the 2009 fiscal year
amounts as part of the Company’s efforts to align compensation arrangements more
closely to those of the Company’s new peer group.
Equity
Grants
The
Board also approved, pursuant to the Company’s 2005 Equity Incentive Plan, the
equity grants set forth below to the executive officers of the Company, with a
grant date of November 24, 2009:
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Name
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Number
of Stock Options†
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Number
of Restricted Stock Units ††
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Steven
R. Springsteel
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135,000
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68,000
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Peter
S. Norman
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61,000
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31,000
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Prashant
K. Karnik
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49,000
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25,000
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David
M. Zuckerman
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33,000
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16,000
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Raymond
Gerber
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33,000
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16,000
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Marchai
B. Bruchey
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49,000
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25,000
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†
The stock options will vest monthly over a four year period commencing on the
first monthly anniversary of the grant date. The exercise price of
the stock options shall be the closing price of the Company’s common stock on
the grant date and will have a term of seven (7) years.
††
One fourth of the restricted stock units will vest each year on the anniversary
of the grant date over four years.
The
stock options will be documented and governed by the terms of the Company’s
standard form of stock option grant notice and stock option
agreement. The restricted stock units will be documented and governed
by the terms of the Company’s standard form of restricted stock unit grant
notice and restricted stock unit agreement approved by the Board on November 18,
2009, copies of which are attached hereto as Exhibits 10.71 and 10.72,
respectively.
Bonus
Plans
2010 Executive Incentive
Bonus Plan
The
Board of the Company approved the Chordiant Software, Inc. fiscal year 2010
Executive Incentive Bonus Plan (the “Executive Plan”), which provides that cash
bonuses will be paid to participants in the Executive Plan based on the
comparison of the Company’s actual fiscal year 2010 financial performance
against the Company’s fiscal year 2010 financial plan (“2010 Financial Plan”)
with respect to three metrics, the Company’s bookings, GAAP revenue and non-GAAP
operating income, each weighted equally.
Each
quarter, a participant is eligible to receive a bonus equal to 25% of his or her
annual target bonus, subject to the below. Payment of bonuses in any
one quarter will include any cumulative “catch up” payment to the extent of any
shortfall in prior quarters, and will be limited to a maximum of 100% of the
participant’s bonus target for the year-to-date period.
At
the end of the fiscal year, the Board will review the Company’s financial
performance for fiscal year 2010 compared to the 2010 Financial Plan and
determine any final amount payable under the Executive Plan. The
actual amount payable under the Executive Plan to each individual participant
has a maximum payment of 200% of such participant’s bonus target at 150%
achievement of plan goals. The Executive Plan provides for a payment
of 100% of a participant’s bonus target at 100% achievement of plan
goals.
For
each metric, for any payment to be made, the Company must achieve 80% of plan
goals, which would result in a payment of 50% of a participant’s bonus target
for such metric. For each 1% of the plan goal achieved above 80% (up to
100%), a participant will be paid an additional 2.5% of his or her target bonus
for such metric for the quarter. For each 1% of the plan goal
achieved above 100% (up to 120%), a participant will be paid an additional 2.5%
of his or her target bonus for such metric for the quarter. For
each 1% of the plan goal achieved above 120% (up to 150%), a participant will be
paid an additional 1.67% of his or her target bonus for such metric for the
quarter. Actual payments are subject to the approval of the
Board.
Notwithstanding
anything to the contrary above, no bonus will be paid in any quarter unless the
Company is profitable on a non-GAAP operating basis in that
quarter.
In
its discretion, the Compensation Committee of the Board may recommend, and the
Board has the authority to approve, a payment of up to 50% of a participant’s
bonus opportunity without regard to the performance criteria set forth in the
Executive Plan.
2010 Senior Vice President
and General Manager Worldwide Client Services Incentive Bonus
Plan
The
Chordiant Software, Inc. Fiscal Year 2010 Senior Vice President and General
Manager Worldwide Client Services Incentive Bonus Plan contains terms identical
to the Executive Plan except that the bonus shall be determined on the following
criteria:
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·
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46.33%
of the bonus will be based on the criteria and payment calculation
formulas established in the Executive
Plan.
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·
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32.20%
of the bonus will be based on the actual worldwide cumulative Professional
Services Directly Controllable Contribution Margin Percentage (“DCCM”)
versus the Company’s plan, as
adjusted.
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·
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21.47%
of the bonus will be based on actual maintenance renewal bookings versus
the Company’s plan.
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·
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For
each quarter, if the Company does not achieve at least 80% of its
year-to-date DCCM goal, no bonus for DCCM will be paid. If the
Company achieves at least 80% of its year-to-date DCCM goal, 50% of the
bonus target for DCCM for that quarter will be paid. For each
1% of DCCM goal achieved above 80% (up to 100%), an additional 2.5% of the
bonus target for DCCM for that quarter will be paid. If the
Company achieves at least 100% of its year-to-date DCCM goal, 100% of the
bonus target for DCCM for that quarter will be paid. For each
1% of DCCM goal achieved above 100% (up to 120%), an additional 5% of the
bonus target for DCCM for that quarter will be paid. Actual
payments are subject to the approval of the
Board.
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2010 General Counsel
Incentive Bonus Plan
The
Chordiant Software, Inc. Fiscal Year 2010 General Counsel Incentive Bonus Plan
contains terms identical to the Executive Plan except that the bonus shall be
determined on the following criteria:
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·
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72.14%
of the bonus will be based on the criteria and payment calculation
formulas established in the Executive
Plan.
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·
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27.86%
of the bonus will be determined as follows: The General Counsel
reports to the Board in his role as Chief Compliance
Officer. Each quarter the General Counsel shall submit a report
to the Audit or Compensation Committee on his activities in this role for
evaluation by the Committee(s). At year end, based upon a
performance evaluation, the Compensation Committee shall recommend a
scoring of full, partial or no payout to the Board for its final
determination. Should the quantitative metrics justify a bonus
payment above 100%, the payment under this opportunity shall be increased
proportionately.
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The
foregoing is only a brief description of the material terms of the Company’s
bonus plans, does not purport to be complete, and is qualified in its entirety
by reference to the Chordiant Software, Inc. Fiscal Year 2010 Executive
Incentive Bonus Plan, Chordiant Software, Inc. Fiscal Year 2010 Senior Vice
President and General Manager Worldwide Client Services Incentive Bonus Plan,
and Chordiant Software, Inc. Fiscal Year 2010 General Counsel Incentive Bonus
Plan.
Fiscal
year 2010 Director Compensation Arrangements
On
November 18, 2009, the Board approved a reduction of $5,000 in the annual
retainer payable to the non-employee directors of the Company, effective as of
November 15, 2009.
Appointment
of Certain Officers
On
November 18, 2009, the Board promoted Marchai B. Bruchey to Senior Vice
President and Chief Marketing Officer, Raymond Gerber to Senior Vice President,
Worldwide Engineering and Chief Technology Officer, Prashant K. Karnik to Senior
Vice President and General Manager, Worldwide Client Services, and Peter S.
Norman to Senior Vice President and Chief Financial Officer.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
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Exhibit
No.
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Description
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10.71
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Form
of Chordiant Software, Inc. 2005 Equity Incentive Plan Restricted Stock
Unit Grant Notice and Chordiant Software, Inc. 2005 Equity Incentive Plan
Restricted Stock Unit Agreement (No Holding Period).
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10.72
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Form
of Chordiant Software, Inc. 2005 Equity Incentive Plan Restricted Stock
Unit Grant Notice for Non-U.S. Employees and Chordiant Software, Inc. 2005
Equity Incentive Plan Restricted Stock Unit Agreement for Non-U.S.
Employees (No Holding Period).
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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Date:
November 19, 2009
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CHORDIANT
SOFTWARE, INC.
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By:
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/s/ STEVEN
R. SPRINGSTEEL
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Steven
R. Springsteel
Chairman,
President and Chief Executive Officer
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Exhibit
Index
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Exhibit
No.
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Description
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10.71
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Form
of Chordiant Software, Inc. 2005 Equity Incentive Plan Restricted Stock
Unit Grant Notice and Chordiant Software, Inc. 2005 Equity Incentive Plan
Restricted Stock Unit Agreement (No Holding Period).
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10.72
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Form
of Chordiant Software, Inc. 2005 Equity Incentive Plan Restricted Stock
Unit Grant Notice for Non-U.S. Employees and Chordiant Software, Inc. 2005
Equity Incentive Plan Restricted Stock Unit Agreement for Non-U.S.
Employees (No Holding Period).
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