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Q2 HOLDINGS, INC. FILES (8-K) Disclosing Change in Directors or Principal Officers(Edgar Glimpses Via Acquire Media NewsEdge) Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. (e) On April 17, 2014, the Compensation Committee of the Board of Directors of Q2 Holdings, Inc. (the "Company") approved the 2014 Bonus Plan for the fiscal year ended December 31, 2014. The 2014 Bonus Plan provides for the payment of cash bonuses to certain of the Company's executive officers, including the Company's named executive officers, based upon achievement of established performance measures and payout formulas determined by the Compensation Committee. The 2014 Bonus Plan provides for a single annual payout opportunity for Messrs. Seale, Flake and Furrer, and for quarterly payout opportunities for Mr. Soukup. The target bonus payments as a percentage of the base salary for each of our named executive officers established by our Compensation Committee, are set forth in the following table: Named Executive Officer Target Bonus as % of Base Salary R.H. "Hank" Seale, III 50% Founder, Executive Chairman and Former President and Chief Executive Officer Matthew P. Flake 73% President and Chief Executive Officer William M. Furrer 36% Senior Vice President of Product and Marketing Stephen C. Soukup 89% Senior Vice President of Sales The 2014 Bonus Plan provides for the bonus amounts to be earned based on the following metrics: Weighting of Component as a % of Target Bonus Payment Bookings Gross Margin Individual Business Objectives Mr. Seale 50% 50% - Mr. Flake 50% 50% - Mr. Furrer 25% 25% 50% Mr. Soukup 80% - 20% The bookings component consists of monthly recurring bookings revenue based on committed or contracted levels in the Company's customer agreements, with an exclusion for one-time services. The gross margin component consists of the Company's gross margin calculated in accordance with generally accepted accounting principles, but excluding stock based compensation expenses, capitalization and amortization. The 2014 Bonus Plan provides that the bookings and gross margin components are to be measured against bookings and gross margin targets based on the 2014 annual budget approved by the Company's board of directors. The individual business objectives component consists of business objectives specific to the individual named executive officer and is measured based upon attainment of specified target objectives. For Messrs. Seale, Flake and Furrer, payouts under the 2014 Bonus Plan with respect to the bookings and gross margin components are to be based on performance within a range of each component's target. No incentive payment may be earned for performance below the target minimum and the maximum bonus may be earned at the target maximum. The range and target for each component applicable to Messrs. Seale, Flake and Furrer are set forth in the following table: -------------------------------------------------------------------------------- Percentage of Bookings Corresponding Weighted and Gross Margin Payout Percentage Per Achievement Level Component Attained Component Minimum 90% 50% At target 100% 100% Maximum 120% 150% The 2014 Bonus Plan provides that, Mr. Soukup is eligible for a quarterly bonus of 50% of his quarterly targeted bonus amount if the threshold of 90% of the quarterly bookings metric is attained, increasing to 100% of his quarterly targeted bonus amount at 100% achievement of the quarterly bookings metric. Mr. Soukup is eligible for overachievement bonus amounts of up to 2.5% of his quarterly targeted bonus amount for every additional 1% of attainment above 100% of the applicable quarterly bookings metric. The overachievement bonus amount for a quarter must be used first to offset any underachievement in the subsequent quarter. If there remains any overachievement bonus amount from the prior quarter after offsetting any underachievement in the subsequent quarter, such remaining amount is payable in the month following the end of the subsequent quarter. -------------------------------------------------------------------------------- |