8-K

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) February 22, 2006

AGILE SOFTWARE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	0-27071	77-0397905
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

6373 San Ignacio Avenue

San Jose, California 95119-1200

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:

(408) 284-4000

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):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

On February 22, 2006, at a meeting of the Compensation Committee (the “Committee”) of the Board of Directors of Agile Software Corporation (the “Company”), the Committee approved the executive bonus plan (the “Bonus Plan”) for the Company’s executive officers for third and fourth quarters of fiscal 2006. A description of the Bonus Plan is attached hereto as Exhibit 99.1 and incorporated herein by reference. Under the Bonus Plan each executive officer has an assigned target bonus level. Depending on corporate financial performance and individual performance, each officer may earn between zero and 200% of the target bonus. Performance under the Bonus Plan is determined based on achievement of company financial performance regarding profitability, customer success and revenue, as well as individual performance, based upon quarterly or other periodic goals.

The following table sets forth the target fiscal year 2006 bonus for the Company’s Named Executive Officers (which officers were determined by reference to the Company’s 2005 proxy statement and are likely to be Named Executive Officers in the Company’s proxy statement for its 2006 annual stockholder meeting, excluding information concerning compensation payable to Bryan D. Stolle and Jay B. Fulcher, which was disclosed in our current report on Form 8-K filed on January 25, 2006).

Name	Target Bonus
Carolyn Aver	$	175,000
Chris Wong	$	125,000
Thomas Twietmeyer	$	75,000

The Committee’s approval of the terms of the Bonus Plan shall not be deemed to create an enforceable agreement between the Company and any employee or executive officer, and the Committee retains discretion to reduce or refuse to authorize any awards under the Bonus Plan despite attainment of any specific objectives. No rights to any awards shall be deemed to exist unless and until the Committee or, with respect to non-executive officers, the Company, authorizes payment of any awards under the Bonus Plan following the completion of any applicable measurement periods.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits.

Exhibit No.	Description
99.1	Executive Bonus Plan.

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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.

Date: February 28, 2006	AGILE SOFTWARE CORPORATION
	By:	/s/ Carolyn V. Aver
		Carolyn V. Aver,
		Chief Financial Officer

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EX-99.1

EXHIBIT 99.1

Executive Staff

Performance Based Compensation (PBC) Plan Summary

Fiscal 2006

(Adopted February 22, 2006)

PLAN A – PARTICIPANTS

Chairman & CEO

President & COO

EVP & CFO

EVP & Chief Product Officer

SVP & CTO

SVP, Human Resources

SVP, Finance

VP, Marketing

and each other Section 16b Officer

PLAN A – DESCRIPTION

• Performance Objectives: Plan A comprises two performance categories as follows:

o Company performance:

• Customer Success

• Proforma Net Income

• Revenue

o Individual performance (MBOs)

• Frequency:

o Company objectives. The Company Objectives will be set annually and measured and paid quarterly or such other period as may be determined by the Compensation Committee of the Board of Directors.

o Individual objectives. Individual Objectives will be set, measured and paid quarterly.

• Special Over-Performance Provisions:

o Company Objectives. If in any given performance period more than 100% of any Company performance Objective category is achieved, the Participant will have the opportunity to earn up to 200% of the Objective target for such category.

o Individual Performance. If in any given performance period the Participant performs above 100% of set Objectives, the Participant will have the opportunity to earn up to 150% of Objectives target.

• New Hires: Unless otherwise agreed to by both the Company and the Participant, each newly hired Participant under Plan A will be eligible to participate in Plan A, during the quarter of hire, on a pro-rata basis from the date of employment.

Termination of Employment:

o Company Objectives. Unless otherwise agreed by both the Company and the Participant, each Plan A Participant must be employed at the end of a quarter to receive full payment of that quarter’s Company performance-based amount. If terminated by the Company prior to the completion of a quarter, the Participant will be eligible for a pro-rated payment under each Company performance category based on the time served in the quarter (actual amount under each category for quarter multiplied by the fraction of the quarter employed).

o Individual Objectives. Unless otherwise agreed by both the Company and the Participant, each Plan A Participant must be employed at the end of a quarter to receive full payment of that quarter’s individual performance-based amount. If terminated by the Company prior to the completion of a given quarter, the Participant will be eligible for an individual performance based payment, if and as determined by the Compensation Committee of the Board of Directors.

PLAN B – PARTICIPANTS

SVP, North America Field Operations

SVP, International Field Operations

SVP, GM Cimmetry Systems

PLAN B – DESCRIPTION

• Performance Measurements: Plan B provides for specific performance measurement based on business unit performance.

• Frequency: Plan B objectives will be set, measured and paid quarterly.

• New Hires: Unless otherwise agreed to by both the Company and the Participant, each newly hired Participant under Plan B will be eligible to participate in Plan B during the quarter of hire, on a pro-rata basis from date of employment.

• Termination of Employment: Unless otherwise agreed by both the Company and the Participant, each Plan B Participant must be employed at the end of a quarter to receive full payment of that quarter’s PBC amount. If terminated prior to the completion of a quarter, the Participant will be eligible for a pro-rated payment of such amount, based on the time served in the quarter (actual PBC amount for the quarter multiplied by the fraction of the quarter employed).