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
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Date of Report (Date of Earliest Event
Reported):
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February
17, 2010
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Kenexa
Corporation
(Exact
Name of Issuer as Specified in
Charter)
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Pennsylvania
(State
or Other Jurisdiction of Incorporation or Organization)
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000-51358
(Commission
File Number)
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23-3024013
(I.R.S.
Employer Identification Number)
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650
East Swedesford Road, Wayne, Pennsylvania
(Address
of Principal Executive Offices)
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19087
(Zip
Code)
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(610)
971-9171
(Registrant’s
Telephone Number, Including Area
Code)
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(Former
Name or Former Address, if Changed Since Last
Report)
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Check
the appropriate box below if the Form 8-K is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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[ ]
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Written
communications pursuant to Rule 425 under the Securities
Act
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[ ]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act
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[ ]
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange
Act
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[ ]
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange
Act
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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
February 17, 2010, the Compensation Committee of the Board of Directors (the
“Compensation Committee”) of Kenexa Corporation (the “Company”) approved the
following base salaries for 2010 for certain of the Company’s executive
officers: Rudy Karsan, Chief Executive Officer and Chairman of the
Board, $500,000; Troy A. Kanter, President and Chief Operating Officer,
$500,000; Donald F. Volk, Chief Financial Officer, $300,000; Archie L. Jones,
Vice President of Business Development, $225,000; and Sarah Teten, Chief
Customer Officer, $200,000.
The
Compensation Committee of the Company also approved performance objectives for
certain of the Company’s executive officers to be used in connection with
evaluating performance and determining the annual bonus amounts payable to these
officers for 2010 pursuant to the Company’s Executive Officer Bonus
Program. Mr. Karsan, Mr. Kanter and Mr. Volk’s bonuses are calculated
based upon the non-GAAP income from operations results for the year. This
measure is defined as GAAP income from operations adjusted for share-based
compensation; amortization of intangibles associated with acquisitions,
restructuring expense, legal fees associated with restructuring and goodwill
impairment expense. Mr. Jones’ bonus is based on revenue from
acquisitions, approval of the Company’s 2011 budget and the number of new
partnership deals he is responsible for. Ms. Teten’s bonus is
primarily related to customer sign offs from willingness to give references and
reducing the implementation time of our solutions by 25%. The
executive officer earns his or her maximum bonus if the Company reaches its
upper target threshold. If the target falls between the lower and upper
threshold, the named executive officer will earn a bonus as determined based on
linear interpolation. The maximum performance bonus amounts for these executive
officers for 2010 pursuant to the Company’s Executive Officer Bonus program are
as follows: Mr. Karsan, $475,000; Mr. Kanter, $475,000; Mr. Volk,
$375,000; Mr. Jones, $250,000; and Ms. Teten, $240,000.
Each of
Mr. Karsan, Mr. Kanter, Mr. Volk, Mr. Jones and Ms. Teten also participates in
the company-wide IMM Bonus program. The IMM is an index calculated based upon
new sales contracts, sales to large customers, income as a percentage of sales
and renewal rates. The index for Mr. Karsan, Mr. Kanter, Mr. Volk and Ms. Teten
is set at a stretch level for maximum payout of $75,000, 90% of the stretch
target attains a payout of $50,000 and 80% of the stretch target attains a
payout of $25,000. The index for Mr. Jones is set at a stretch level for maximum
payout of $50,000, 90% of the stretch target attains a payout of $33,000 and 80%
of the stretch target attains a payout of $16,000. Below 80% of stretch target
for each NEO equals zero payout.
On
February 17, 2010, the Compensation Committee approved the grant of options to
purchase shares of the Company’s common stock under the Company’s 2005 Equity
Inventive Plan (the “Plan”) to the following executive officers and in the
following amounts (the “Options”): Mr. Karsan, options to purchase
100,000 shares of common stock; Mr. Kanter, options to purchase 100,000 shares
of common stock; Mr. Volk, options to purchase 40,000 shares of common stock;
Mr. Jones, options to purchase 10,000 shares of common stock; and Ms. Teten,
options to purchase 10,000 shares of common stock. Each option grant
has an exercise price equal to $10.50, the closing price of the Company’s common
stock on the Nasdaq Stock Market on February 17, 2010. In
addition, On February 17, 2010, the Compensation Committee approved the grant of
restricted stock units to purchase shares of the Company’s common stock under
the Plan to the following executive officers and in the following amounts (the
“RSUs”): Mr. Karsan, RSUs to purchase 30,000 shares of common stock;
Mr. Kanter, RSUs to purchase 30,000 shares of common stock; and Mr. Volk, RSUs
to purchase 10,000 shares of common stock.
Each
Option and RSU, will become vested and exercisable as follows: (i)
one-fourth of such grant on February 19, 2011, (ii) one-fourth of such grant on
February 19, 2012; (iii) one-fourth of such grant on February 19, 2013 and (iv)
one-fourth of such grant on February 19, 2014. Each executive will have
until 10 years from the date of the grant to exercise any vested
Option. Vested RSUs will be delivered to the executive upon
vesting.
SIGNATURES
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: February
23, 2010
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By: /s/ Donald F.
Volk
Donald F. Volk
Chief Financial
Officer
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