def14a

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934 (Amendment No. )

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RIGHTNOW TECHNOLOGIES, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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Dear Stockholder:

You are cordially invited to attend the 2010 Annual Meeting of Stockholders (the “Annual Meeting”) of RightNow Technologies, Inc. to be held at 12:00 p.m. (noon) Mountain Daylight Savings Time on Monday, June 7, 2010 at the Hilton Garden Inn, 2023 Commerce Way, Bozeman, Montana 59715.

Your vote at the Annual Meeting is important to us. At the Annual Meeting, the stockholders will be asked to elect three directors and to ratify the appointment of our independent registered public accounting firm for 2010. The Notice of 2010 Annual Meeting of Stockholders and Proxy Statement describe the matters to be presented at the Annual Meeting.

We are pleased to provide proxy materials to our stockholders primarily over the Internet, which we believe will lower the costs of delivering such materials while also reducing the environmental impact of printing and mailing. We have mailed beneficial owners of our stock a notice containing instructions on how to access our 2010 Proxy Statement and 2009 Annual Report on Form 10-K and vote online. The notice also includes instructions on how to receive a paper copy of annual meeting materials, including the notice of annual meeting, proxy statement and proxy card. If you received your annual meeting materials by mail, the notice of annual meeting, proxy statement and proxy card were enclosed.

Our board of directors recommends that stockholders vote in favor of the election of the nominated directors named in the attached Proxy Statement and the ratification of the appointment of our independent registered public accounting firm for 2010. Whether or not you plan to attend the Annual Meeting, please vote as soon as possible by phone, through the Internet or, if you are a record holder of our stock, by marking, signing, dating and returning the enclosed proxy card in the enclosed envelope. If you later decide to attend the Annual Meeting and wish to change your vote, you may do so simply by voting in person at the meeting. Due to recent changes in voting rules that prevent your bank or broker from voting your uninstructed shares on a discretionary basis in the election of directors, it is important that you cast your vote.

We look forward to seeing you at the Annual Meeting.

Sincerely,

Greg R. Gianforte

Chairman, Chief Executive Officer and President

RIGHTNOW TECHNOLOGIES, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD JUNE 7, 2010

TO OUR STOCKHOLDERS:

NOTICE IS HEREBY GIVEN that the 2010 Annual Meeting of Stockholders (the “Annual Meeting”) of RightNow Technologies, Inc., a Delaware corporation, will be held on Monday, June 7, 2010, at 12:00 p.m. (noon) Mountain Daylight Savings Time at the Hilton Garden Inn, 2023 Commerce Way, Bozeman, Montana 59715, as more fully described in the Proxy Statement. Matters to be voted upon at the Annual Meeting include the following:

1. To elect the three directors named in the attached Proxy Statement to serve for three-year terms ending at the 2013 Annual Meeting of Stockholders or until their successor is duly elected and qualified or until their earlier resignation or removal;

2. To ratify the appointment of KPMG LLP as our independent registered public accounting firm for 2010; and

3. To transact such other business as may properly come before the meeting, or any adjournment or postponement thereof.

We recommend that stockholders vote FOR the matters listed above. Only stockholders of record at the close of business on April 9, 2010 are entitled to notice of and to vote at the Annual Meeting and any adjournment(s) or postponement(s) thereof. Our stock transfer books will remain open between the record date and the date of the meeting. A list of stockholders entitled to vote at the Annual Meeting will be available for inspection at our principal executive offices and at the Annual Meeting.

All stockholders are cordially invited to attend the meeting in person. Whether or not you plan to attend, please vote your shares by phone, through the Internet or, if you are a record holder of our stock, by marking, signing, dating and returning the enclosed proxy card in the enclosed envelope. Due to recent changes in voting rules that prevent your bank or broker from voting your uninstructed shares on a discretionary basis in the election of directors, it is important that you cast your vote.

You may revoke your proxy at any time prior to the Annual Meeting. If you attend the Annual Meeting and vote by ballot, your proxy will be revoked automatically and only your vote at the Annual Meeting will be counted.

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to Be Held on June 7, 2010:

The Proxy Statement and Annual Report on Form 10-K are available at: http://investor.rightnow.com/annual-proxy.cfm.

Sincerely,

Alan A. Rassaby

Secretary

Bozeman, Montana

April 27, 2010

YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN. PLEASE READ THE ATTACHED PROXY STATEMENT CAREFULLY AND VOTE AS PROMPTLY AS POSSIBLE BY PHONE, THROUGH THE INTERNET OR, IF YOU ARE A RECORD HOLDER OF OUR STOCK, BY MARKING, SIGNING, DATING AND RETURNING THE ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE. PLEASE DO NOT RETURN THE ENCLOSED PAPER BALLOT IF YOU ARE VOTING OVER THE INTERNET OR BY TELEPHONE.

RIGHTNOW TECHNOLOGIES, INC.

136 Enterprise Boulevard

Bozeman, Montana 59718

PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 7, 2010

General

The enclosed proxy (the “Proxy”) is solicited on behalf of the board of directors of RightNow Technologies, Inc., a Delaware corporation, for use at the 2010 Annual Meeting of Stockholders to be held on Monday, June 7, 2010 (the “Annual Meeting”) and at any adjournment or postponement thereof. The Annual Meeting will be held at 12:00 p.m. (noon) Mountain Daylight Savings Time at the Hilton Garden Inn, 2023 Commerce Way, Bozeman, Montana 59715. These proxy materials were mailed on or about April 27, 2010 to record holders of our stock entitled to vote at the Annual Meeting.

Voting; Quorum

The specific proposals to be considered and acted upon at the Annual Meeting are summarized in the Proxy Notice and are described in more detail in this Proxy. On April 9, 2010, the record date (the “Record Date”) for determination of stockholders entitled to notice of and to vote at the Annual Meeting, there were 31,987,106 shares of our common stock (the “Common Stock”) outstanding and approximately 80 holders of record according to information provided by our transfer agent. No shares of our preferred stock are outstanding. Only stockholders of record at the close of business on the Record Date are entitled to notice of and to vote at the Annual Meeting and any adjournment(s) or postponement(s) thereof. Each stockholder is entitled to one vote for each share of Common Stock held by such stockholder on the Record Date. Stockholders may not cumulate votes in the election of directors.

The presence at the Annual Meeting, either in person or by proxy, of holders of shares of our outstanding stock entitled to vote and representing a majority of the voting power of all of such shares shall constitute a quorum for the transaction of business. In the election of the directors under Proposal One, the three nominees receiving the highest number of affirmative votes of the Common Stock present or represented by proxy and entitled to vote at the Annual Meeting, will be elected. With regard to Proposal Two, the affirmative vote of the holders of Common Stock representing a majority of the voting power present or represented by proxy and entitled to vote at the Annual Meeting is being sought.

All votes will be tabulated by the inspector of election appointed for the meeting, who will separately tabulate affirmative and negative votes, abstentions and broker non-votes (i.e., shares held by a broker or nominee that are represented at the Annual Meeting, but with respect to which such broker or nominee is not instructed to vote on a particular proposal and does not have discretionary voting power). Abstentions and broker non-votes are counted as present for purposes of determining the presence or absence of a quorum for the transaction of business. With regard to Proposal One, broker non-votes and votes marked “withheld” will not be counted towards the tabulations of votes cast on such proposal presented to the stockholders, will not have the effect of negative votes and will not affect the outcome of the election of the directors. With regard to Proposal Two, abstentions will be counted towards the tabulations of votes cast on such proposal presented to the stockholders and will have the same effect as negative votes, whereas broker non-votes will not be counted for purposes of determining whether such proposal has been approved and will not have the effect of negative votes.

Effect of Not Casting Your Vote

If your shares are held by a bank or broker in street name, it is important that you cast your vote if you want it to count in the election of directors. In the past, if your shares were held by a bank or broker in street name and you did not indicate how you wanted your shares voted in the election of directors, your bank or broker was permitted to vote those shares on your behalf in the election of directors as it deemed appropriate.

Recent changes in voting rules now prevent your bank or broker from voting your uninstructed shares on a discretionary basis in the election of directors. Accordingly, if your shares are held by a bank or broker in street name and you do not instruct your bank or broker how to vote in the election of directors, no votes will be cast on your behalf. Your bank or broker will, however, continue to have discretion to vote any uninstructed shares on the ratification of the appointment of our independent registered public accounting firm.

Proxies

If the enclosed form of Proxy is properly signed and returned to us, the shares represented thereby will be voted at the Annual Meeting in accordance with the instructions specified thereon. If the Proxy does not specify how the shares represented thereby are to be voted, the Proxy will be voted FOR the election of the directors proposed by the board of directors under Proposal One unless the authority to vote for the election of such directors is withheld and, if no contrary instructions are given, the Proxy will be voted FOR the approval of Proposal Two. You may revoke or change your Proxy at any time before the Annual Meeting by filing with our corporate secretary, at our principal executive offices at 136 Enterprise Boulevard, Bozeman, Montana 59718, a notice of revocation or another signed Proxy with a later date. You may also revoke your Proxy by attending the Annual Meeting and voting in person.

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to Be Held on June 7, 2010:

The Proxy Statement and Annual Report on Form 10-K are available at: http://investor.rightnow.com/annual-proxy.cfm.

Solicitation

We will bear the entire cost of solicitation, including the preparation, assembly, printing and mailing of this Proxy Statement, the Proxy and any additional solicitation materials furnished to the stockholders. Copies of solicitation materials will be furnished to brokerage houses, fiduciaries and custodians holding shares in their names that are beneficially owned by others so that they may forward this solicitation material to such beneficial owners. In addition, we may reimburse such persons for their costs in forwarding the solicitation materials to such beneficial owners. The original solicitation of proxies by mail may be supplemented by a solicitation by telephone, facsimile, Internet or other means by our directors, officers or employees. No additional compensation will be paid to these individuals for any such services. Except as described above, we do not presently intend to solicit proxies other than by mail.

Deadline for Receipt of Stockholder Proposals

Stockholders may present proposals for action at a future meeting only if they comply with the requirements of the proxy rules established by the Securities and Exchange Commission (“SEC”) and our Bylaws. Pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended, some stockholder proposals may be eligible for inclusion in the proxy statement for our 2011 Annual Meeting of Stockholders (the “2011 Annual Meeting”). These stockholder proposals, along with proof of ownership of our stock in accordance with Rule 14a-8(b)(2), must be received by us not later than December 28, 2010, which is 120 calendar days prior to the anniversary date of the mailing of this Proxy Statement. Stockholders are also advised to review our Bylaws which contain additional advance notice requirements, including requirements with respect to advance notice of stockholder proposals (other than non-binding proposals presented under Rule 14a-8) and director nominations. Under our current Bylaws, the deadline for submitting such stockholder

proposals or a nomination for director is not more than 90 calendar days prior to the anniversary date of the immediately preceding annual meeting.

In addition, the proxy solicited by the board of directors for the 2011 Annual Meeting will confer discretionary authority to the proxy holders to vote on any stockholder proposal presented at that meeting, unless we receive notice of such proposal not later than March 14, 2011, which is 45 calendar days prior to the anniversary date of the mailing of this Proxy Statement.

Stockholder proposals must be in writing and should be addressed to our corporate Secretary, at our principal executive offices at 136 Enterprise Boulevard, Bozeman, Montana 59718. It is recommended that stockholders submitting proposals direct them to our corporate Secretary and utilize certified mail, return receipt requested in order to provide proof of timely receipt. The Chairman of the Annual Meeting reserves the right to reject, rule out of order or take other appropriate action with respect to any proposal that does not comply with these and other applicable requirements, including conditions set forth in our Bylaws and conditions established by the SEC.

We have not been notified by any stockholder of his or her intent to present a stockholder proposal from the floor at the 2010 Annual Meeting. The enclosed Proxy grants the proxy holders discretionary authority to vote on any matter properly brought before the Annual Meeting.

Note with Respect to Forward-Looking Statements

We have made certain forward-looking statements in this Proxy Statement that relate to expectations concerning matters that are not historical facts. Words such as “projects,” “believes,” “anticipates,” “plans,” “expects,” “intends” and similar words and expressions are intended to identify forward-looking statements. Although we believe that such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from such expectations. All forward-looking statements attributable to us are expressly qualified in their entirety by such language. We do not undertake any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING

PROPOSAL ONE:

ELECTION OF DIRECTORS

General

Our certificate of incorporation provides for a classified board of directors consisting of three classes of directors, each serving staggered three-year terms and each as nearly equal in number as possible as determined by our board of directors. As a result, a portion of our board of directors will be elected each year. Our board of directors currently consists of seven persons. Messrs. Avis, Gianforte and Kendra have been designated Class I directors whose terms expire at the 2010 Annual Meeting of Stockholders. Messrs. Lansing and Snyder have been designated Class II directors whose terms expire at the 2011 Annual Meeting. Messrs. Allen and Singh have been designated Class III directors whose terms expire at the 2012 Annual Meeting.

The class whose term of office expires at the Annual Meeting currently consists of three directors. On the recommendation of the Nomination and Governance Committee, our board of directors, including its independent directors, selected and approved Messrs. Avis, Gianforte and Kendra as nominees for election in the class being elected at the Annual Meeting to serve for a term of three years, expiring at the 2013 Annual Meeting of Stockholders, or until their successors are duly elected and qualified or until their earlier resignation or removal. If the nominees are elected, our board of directors will consist of seven persons.

The nominees for election are currently members of our board of directors and have agreed to serve if elected. Management has no reason to believe that the nominees will be unavailable to serve. In the event the nominees named herein are unable to serve or decline to serve at the time of the Annual Meeting, the persons named in the enclosed Proxy will exercise discretionary authority to vote for substitutes. Unless otherwise instructed, the proxy holders will vote the Proxies received by them FOR the nominees named below.

Directors and Nominees

The names of our directors and nominees, their ages and positions as of March 31, 2010 and biographical information about them are as follows:


Name	Age		Position

Greg R. Gianforte		48	Chairman, Chief Executive Officer and President
Richard E. Allen(1)(2)		52	Director
Gregory M. Avis(1)(3)		51	Director
Thomas W. Kendra(1)(3)		55	Director
William J. Lansing(2)(3)		51	Director
S. Steven Singh		48	Director
Allen E. Snyder(2)		55	Director


(1)		Member of Audit Committee.

(2)		Member of Compensation Committee.

(3)		Member of Nomination and Governance Committee.

Nominees for Terms Ending Upon the 2013 Annual Meeting of Stockholders

Greg R. Gianforte, 48, is our founder, Chairman, chief executive officer and president. Prior to founding RightNow in September 1995, he was the vice president of North American sales of McAfee, Inc. (formerly Network Associates, Inc.), a provider of network security and tools. Before joining McAfee, Inc., Mr. Gianforte founded Brightwork Development, a developer of network management applications, in 1986, and served as president of Brightwork until 1994 when Brightwork was acquired by McAfee, Inc. Mr. Gianforte also

beneficially owns, indirectly, a membership interest in Genesis Partners, LLC, from whom we lease our principal offices. Mr. Gianforte serves on the board of directors of several privately held companies. He holds a B.E. degree in electrical engineering and an M.S. degree in computer science from Stevens Institute of Technology. We believe Mr. Gianforte’s qualifications to serve on our board of directors include his 24 years experience as a leader in the computer industry, including as a founder of Brightwork and RightNow Technologies, and as our chairman since 1995, our chief executive officer since 1999 and our president since 2003.

Gregory M. Avis, 51, has served on our board of directors since December 2000. Mr. Avis is a founding managing director of Summit Partners, a private equity and venture capital firm, since 1990. Mr. Avis currently serves on the board of directors of one privately held company. Mr. Avis holds a B.A. degree, cum laude, in political economy from Williams College and an M.B.A. degree with Distinction from Harvard University. We believe Mr. Avis’ qualifications to serve on our board of directors include his experience on over 40 boards of directors, including 15 public companies, for many of which he has served on the audit committee, and his experience as a venture capitalist by profession, which involves analyzing and critiquing financial statements.

Thomas W. Kendra, 55, was appointed to our board of directors in March 2007. He is now an executive vice president of the Enterprise Products and Solutions Business Line at CA, Inc. (formerly Computer Associates), a provider of information technology management software. From January 2004 until June 2008, Mr. Kendra held senior positions at Symantec Corporation, an international technology firm focused on protecting information and computer systems, where he served successively as group president sales and services, group president security and data management and group president security and compliance. Before joining Symantec in January 2004, he spent 26 years at International Business Machines Corp. (IBM), an information technology company, where he was a member of IBM’s senior leadership team and held executive positions including vice president of marketing and sales for the database division, vice president of worldwide server sales and vice president for the software business in Asia Pacific and Japan. Mr. Kendra currently serves on the board of directors of one privately held company and one business association. Mr. Kendra holds a B.S. degree in business administration from Indiana University. We believe Mr. Kendra’s qualifications to serve on our board of directors include his data security experience at Symantec, his merger and acquisition experience at IBM, Symantec and CA, his experience with human resources activities in organizations with over 8,000 individuals, his operations experience as an executive and his extensive experience abroad including living in Tokyo, Japan for nearly two and a half years while responsible for IBM’s Asia Pacific/Japan software business.

Continuing Directors for Term Ending Upon the 2011 Annual Meeting of Stockholders

William J. Lansing, 51, has served on our board of directors since April 2000. He is now the chief executive officer, president and a director of Infospace, Inc., a developer of metasearch products. From December 2003 until October 2007, he was chief executive officer, president and a director of ValueVision Media, Inc., a direct marketing company. Mr. Lansing was a general partner of General Atlantic Partners, LLC, a private equity investment firm from 2001 to December 2003. From March 2000 to September 2001, Mr. Lansing was the chief executive officer and a director of NBC Internet, Inc., an internet portal company. From 1998 to March 2000, Mr. Lansing served in various positions for Fingerhut Companies, Inc., a direct marketing company, including president and chief executive officer. From November 1996 to May 1998, Mr. Lansing served as vice president of corporate business development for General Electric Company and was a member of General Electric’s Corporate Executive Council. From January 1996 to October 1996, he served as chief operating officer of Prodigy, Inc., an on-line service company. From 1986 through 1995, Mr. Lansing was first an associate and later a principal at McKinsey & Company, a management consulting company. Mr. Lansing serves on the board of directors of Fair Isaac Corporation, a decision analytics company. Mr. Lansing holds a B.A. degree in English from Wesleyan University and a J.D. degree from Georgetown University. We believe Mr. Lansing’s qualifications to serve on our board of directors include his experience as a chief executive officer of multiple public companies and his financial expertise.

Allen E. Snyder, 55, was appointed to our board of directors in July 2008. Mr. Snyder has been the chief executive officer and a director of Aepona Ltd., a developer and provider of telecommunications software

since April 2008. Mr. Snyder served as the president and chief executive officer from July 2007 to February 2008 at Carrier Access Corporation, a provider of consolidated access technologies, and as president and chief operating officer from November 2006 to July 2007. He held several executive management positions at Openwave Systems, a provider of software and services in the telecommunications industry, including executive vice president and chief operating officer from 2005 to 2006, executive vice president of the server business from 2003 to 2005, senior vice president worldwide customer operations from 2002 to 2003 and senior vice president of customer advocacy from 2000 to 2002. Prior to that time he was a senior vice president of support services at Oracle Corporation, a developer and provider of information management systems software. Mr. Snyder received an associate degree in electrical engineering from the Community College of USAF and an executive management development certificate from Northeastern University. We believe Mr. Snyder’s qualifications to serve on our board of directors includes his experience on the board of directors of one public company (Carrier Access, Inc.) and three private companies (Aepona Ltd., Bubble Motion, Inc. and Storability, Inc.), his operations experience as a chief executive officer with Carrier and Aepona, 13 years experience as an executive and four years experience with the Remuneration Committee for Aepona.

Continuing Director for Term Ending Upon the 2012 Annual Meeting of Stockholders

Richard E. Allen, 52, has served on our board of directors since May 2004. Mr. Allen was the chief financial officer of J.D. Edwards (now Oracle, Inc.), an enterprise application software company, from January 1990 to September 2003, and had held several senior management positions and titles since joining J.D. Edwards in August 1985. Mr. Allen served as a member of J.D. Edwards’ board of directors from September 1991 to July 2003. Prior to joining J.D. Edwards, Mr. Allen served as controller for Luff Exploration, an oil and gas exploration and production company, from 1982 to 1985, and as a senior accountant with Coopers & Lybrand, a public accounting firm, from 1979 to 1982. Mr. Allen serves on the board of directors of two privately held companies. Mr. Allen holds a B.S. degree in business administration with a concentration in accounting from Colorado State University. We believe Mr. Allen’s qualifications to serve on our board of directors include his experience as a chief financial officer for 13 years and his experience serving as a director of several public and private companies.

S. Steven Singh, 48, has served on our board of directors since October 2009. Mr. Singh is currently the chief executive officer of Concur Technologies, Inc., which helps organizations to globally control costs by automating the processes they use to manage employee spending. Mr. Singh has served as Concur’s chief executive officer since 1996, as director since 1993 and as chairman of the board of directors since September 1999. From 1993 to 1996, Mr. Singh served as general manager of the contract management division at Symantec Corporation, an international technology firm focused on protecting information and computer systems. Mr. Singh serves as Chairman of the National Business Travel Association (NBTA) Foundation Board, serves on the board of directors of AdReady and is a member of the Washington Roundtable and the Voyager Capital Advisory Board. We believe Mr. Singh’s qualifications to serve on our board of directors include his significant expertise in managing a technology company that delivers its services in a Software-as-a-Service model and his significant sales and marketing background related to technology services.

There are no family relationships among any of our directors, nominees or executive officers.

Corporate Governance, Board Composition and Board Committees

Independent Directors. Each of our directors other than Mr. Gianforte qualifies as an independent director in accordance with the published listing requirements of The Nasdaq Stock Market LLC, or Nasdaq. The Nasdaq independence definition includes a series of objective tests, such as that the director is not also one of our employees and has not engaged in various types of business dealings with us. In addition, as further required by the Nasdaq rules, our board of directors has made a subjective determination as to each independent director that no relationships exist which, in the opinion of our board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making these determinations, our directors reviewed and discussed information provided by the directors and us with regard to each director’s business and personal activities as they may relate to us and our management, including

transactions in the ordinary course of business between us and entities with which some of our directors are associated.

Lead Independent Director. Mr. Lansing, a non-employee director, was appointed to serve in a lead independent director capacity on June 6, 2008. Mr. Lansing’s specific responsibilities as lead independent director include: (a) advising the chairman of the board as to an appropriate schedule of board meetings; (b) providing the chairman of the board with input as to the preparation of the agendas for the board and committee meetings; (c) advising the chairman of the board as to the quality, quantity and timeliness of the information submitted by our management that is necessary or appropriate for the non-employee directors to effectively and responsibly perform their duties; (d) developing the agendas for and serving as chairperson of the executive session of our board’s non-employee directors; and (e) serving as principal liaison between our non-employee directors and our chairman of the board on sensitive issues. Our chief executive officer also serves as chairman of our board of directors. In such circumstances, we believe that it is good corporate practice to appoint a lead director both to serve as a principal point of contact for communicating the views of the independent directors to the chief executive officer, and to ensure that the independent directors have significant influence on the manner in which the business of our board of directors is conducted.

Board Structure and Committees. Our chief executive officer chairs our board of directors. We believe that the combination of the two roles contributes to streamlined decision making and avoids role confusion. Our board of directors has established an audit committee, a compensation committee and a nomination and governance committee. Our board of directors and its committees set schedules to meet throughout the year, and also can hold special meetings and act by written consent from time to time as appropriate. The independent directors of our board of directors also hold separate regularly scheduled executive session meetings at least twice a year at which only independent directors are present. Our board of directors has delegated various responsibilities and authority to its committees as generally described below. The committees regularly report on their activities and actions to the full board of directors. Each member of each committee of our board of directors qualifies as an independent director in accordance with the Nasdaq standards described above. Each committee of our board of directors has a written charter approved by our board of directors. Copies of each charter are posted on our web site at http://www.rightnow.com under the Investor Relations section. The inclusion of our web site address in this proxy statement does not include or incorporate by reference the information on our web site into this proxy statement.

Audit Committee. The audit committee of our board of directors reviews and monitors our corporate financial statements and reporting and our internal and external audits, including, among other things, our internal controls and audit functions, the results and scope of the annual audit and other services provided by our independent auditors and our compliance with legal matters that have a significant impact on our financial statements. Our audit committee also consults with our management and our independent auditors prior to the presentation of financial statements to stockholders and, as appropriate, initiates inquiries into aspects of our financial affairs. Our audit committee has established procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters, and for the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters. In addition, our audit committee is directly responsible for the appointment, retention, compensation and oversight of the work of our independent auditors, including approving services and fee arrangements. In accordance with our audit committee’s charter and our policies regarding related person transactions, all related person transactions are approved by our audit committee and board of directors before we enter into them. Please see the information set forth under the heading “Policies and Procedures for Related Person Transactions” in this Proxy Statement for additional details about our policies regarding related person transactions. The current members of our audit committee are Messrs. Allen (chair), Avis and Kendra. Our audit committee held six meetings during 2009.

In addition to qualifying as independent under the Nasdaq rules, each member of our audit committee can read and has an understanding of fundamental financial statements, and each qualifies as independent under special standards established by the SEC for members of audit committees.

Our audit committee includes at least one member who has been determined by our board of directors to meet the qualifications of an audit committee financial expert in accordance with SEC rules. Mr. Allen is the independent director who has been determined to be an audit committee financial expert. This designation is a disclosure requirement of the SEC related to Mr. Allen’s experience and understanding with respect to certain accounting and auditing matters. The designation does not impose on Mr. Allen any duties, obligations or liability that are greater than are generally imposed on him as a member of our audit committee and our board of directors, and his designation as an audit committee financial expert pursuant to this SEC requirement does not affect the duties, obligations or liability of any other member of our audit committee or board of directors.

Compensation Committee. The compensation committee of our board of directors reviews and approves our compensation policies and all forms of compensation to be provided to our executive officers and directors, including, among other things, annual salaries, bonuses, stock options and other incentive compensation arrangements. Where the form of compensation is performance based, the committee approves the design and content of the compensation plan to ensure that the plan incents appropriate behavior and does not encourage excessive risk taking. In the case of the annual cash incentive plan, which applies to all employees at director level and above, including executive officers, our compensation committee has satisfied itself that financial targets proposed by management are realistic and appropriate, taken advice from its own compensation consultant and approved caps on cash incentives payable in connection with earnings targets in order to discourage unwarranted expense reductions. The regional cash incentive plans for general managers approved by the committee include incentives for achievement early in the financial year, while still providing sufficient financial incentive for performance later in the financial year. Sales policies are designed to minimize the risk of payment of commissions for contracts involving unacceptable credit risk.

The compensation committee may form and delegate any of its responsibilities to a subcommittee so long as such subcommittee consists solely of at least two independent members of the compensation committee. In addition, our compensation committee administers our stock option plans, including reviewing and granting stock options, with respect to our executive officers and directors, and from time to time assists our board of directors in administering our stock option plans with respect to all of our other employees. Our compensation committee also reviews and approves various other of our compensation policies and matters. The current members of our compensation committee are Messrs. Allen, Lansing and Snyder (chair). Our compensation committee held five meetings during 2009.

Nomination and Governance Committee. The nomination and governance committee of our board of directors reviews and reports to our board of directors on a periodic basis with regard to matters of corporate governance, and reviews, assesses and makes recommendations on the effectiveness of our corporate governance policies. In addition, our nomination and governance committee reviews and makes recommendations to our board of directors regarding the size and composition of our board of directors and the appropriate qualities and skills required of our directors in the context of the then current make-up of our board of directors. This includes an assessment of each candidate’s independence, viewpoints, personal and professional integrity, financial literacy or other professional or business experience relevant to an understanding of our business, ability to think and act independently and with sound judgment and ability to serve our long-term interests as well as those of our stockholders. These factors, and others as considered useful by our nomination and governance committee, are reviewed in the context of an assessment of the perceived needs of our board of directors at a particular point in time. As a result, the priorities and emphasis of our nomination and governance committee and of our board of directors may change from time to time to take into account changes in business and other trends and the portfolio of skills and experience of current and prospective directors. The board seeks to have a membership that is both diversified and committed to diversity. The board and the nomination and governance committee will not discriminate on the basis of race, color, age, gender, sexual orientation, national origin, religion, marital status, medical condition, physical or mental disability, military service, pregnancy, childbirth and related medical conditions or any other protected classification in selecting nominees. Our board of directors has adopted a diversity policy to ensure that the membership on our board of directors continues to maintain these standards. Our nomination and governance committee leads the search for and selects, or recommends that our board of directors select, candidates for election to our board of directors (subject to legal rights, if any, of third parties to nominate or appoint directors). Consideration of new director candidates typically involves a series of committee

discussions, review of information concerning candidates and interviews with selected candidates. Candidates for nomination to our board of directors typically have been suggested by other members of our board of directors or by our chief executive officer. From time to time, our nomination and governance committee may engage the services of a third-party search firm to identify director candidates. The members of our nomination and governance committee are Messrs. Avis, Kendra and Lansing (chair). Our nomination and governance committee held one meeting during 2009.

Although our nomination and governance committee does not have a formal policy on stockholder nominations, it will consider candidates proposed in writing by stockholders, provided such proposal meets the eligibility requirements for submitting stockholder nominations for inclusion in our next proxy statement and is accompanied by certain required information about the candidate, in accordance with the procedures set forth in Article III, Section 3.02 of our Bylaws and in the charter of our nomination and governance committee. If an eligible stockholder wishes to recommend a nominee, he or she should submit such recommendation in writing to the chair of our nomination and governance committee, care of our corporate secretary, by the deadline set forth above under “Deadline for Receipt of Stockholder Proposals.” The charter of our nomination and governance committee and Article III, Section 3.02 of our Bylaws require that such recommendation specify the following information: (a) the name and address of the nominee; (b) the name and address of the stockholder making the nomination; (c) the number of shares of our common stock entitled to vote at such meeting held by the stockholder; (d) a representation that the nominating stockholder is a stockholder of record entitled to vote at such meeting and intends to appear in person or by proxy at such meeting to nominate the person specified in the notice; (e) the nominee’s qualifications for membership on our board of directors; (f) all of the information that would be required in a proxy statement soliciting proxies for the election of the nominee as a director; (g) a description of all direct or indirect arrangements or understandings between the nominating stockholder and the nominee and any other person or persons (naming such person or persons) pursuant to whose request the nomination is being made by the stockholder; (h) all other companies to which the nominee is being recommended as a nominee for director; and (i) a signed consent of the nominee to cooperate with reasonable background checks and personal interviews, and to serve as a director, if elected. Candidates proposed by stockholders will be evaluated by our nomination and governance committee using the same criteria as for all other candidates. Our nomination and governance committee has not received any nominations from any of our stockholders in connection with this Annual Meeting. On the recommendation of our nomination and governance committee, our board of directors, including its independent directors, selected and approved the nomination of Messrs. Gianforte, Avis and Kendra for election at the Annual Meeting, all of whom are standing for re-election by our stockholders.

Annual Self-Evaluations. Each of our committees evaluates its own performance as a committee annually. The evaluations include committee effectiveness and compliance with their respective charters. The results of such evaluations and recommended changes are reported to the board of directors. The nomination and governance committee oversees an annual review of the performance of the full board and the diversity, experience and qualifications of our directors, and oversees the annual self-evaluation process of each board committee.

Director Resignation Policy. In order to ensure appropriate representation on our board of directors, our board of directors has adopted a policy regarding resignation upon a director’s retirement or change in principal occupation or business association from the position the director held on the latter of: (a) the effective date of the policy; (b) the date when the director was last elected to our board of directors; and (c) the date, if any, our board of directors last rejected an offer by the director to resign under the policy. Under the policy, upon such a change in position, a director shall offer his or her resignation as a board member to our nomination and governance committee, which committee will then recommend that our board of directors accept or reject the offer of resignation based on a review of the individual’s change in position and any effect it may have on the director’s service on our board of directors in all circumstances.

Succession Plan. The Company has a board approved succession plan for the chief executive officer and all members of its executive management team which includes identifying and developing internal candidates, wherever appropriate. If no internal candidate appears ready, one or more executive recruiting

firms may be retained to identify external candidates. The criteria for a person to succeed the chief executive officer and/or other members of the executive management team are evaluated at least annually.

Director Education. Director education is a valuable component of corporate governance. We have adopted a policy whereby directors are supported in their pursuit of education relevant to their duties and corporate governance. Mr. Singh attended Stanford Law School’s Directors’ College in 2009 prior to joining our board of directors.

Board and Committee Meetings. Our board of directors held ten meetings during 2009 and acted by written consent on four occasions in 2009. Each director other than Mr. Avis attended or participated in 75% or more of the aggregate of (i) the total number of meetings of our board of directors and (ii) the total number of meetings held by all committees of our board of directors on which such director served during 2009. All of our current directors except for Messrs. Avis, Kendra and Singh, who was not then a director, attended our annual meeting of stockholders in 2009.

Although we do not have a formal policy regarding attendance by members of our board of directors at our annual meetings of stockholders, directors are encouraged to attend, except where the failure to attend is due to unavoidable circumstances or conflicts.

Stockholder Communications. Our board of directors has implemented a process by which stockholders may send written communications to the attention of the board, any committee of the board or any individual board member, in care of our corporate secretary at 136 Enterprise Boulevard, Bozeman, Montana 59718. This centralized process will assist the board in reviewing and responding to stockholder communications in an appropriate manner. The name of any specific intended board recipient should be noted in the communication. Our corporate secretary will be primarily responsible for collecting, organizing and monitoring communications from stockholders and, where appropriate depending on the facts and circumstances outlined in the communication, providing copies of such communications to the intended recipients. Communications will be forwarded to directors if they relate to appropriate and important substantive corporate or board matters. Communications that are of a commercial or frivolous nature or otherwise inappropriate for the board’s consideration will not be forwarded to the board. Any communications not forwarded to the board will be retained for a period of twelve months and made available to any of our independent directors upon their general request to view such communications. In addition, our corporate secretary will provide all non-forwarded communications to the chairman of our nomination and governance committee at least annually. There were no changes in this process in 2009.

Code of Ethics and Business Conduct. Our board of directors has adopted a code of ethics and business conduct that applies to all of our employees, officers (including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions) and directors. Our nomination and governance committee reviews the Code of Ethics annually. The full text of our code of ethics and business conduct is posted on our web site at http://www.rightnow.com under the Investor Relations section. We intend to disclose future amendments to certain provisions of our code of ethics and business conduct, or waivers of such provisions, applicable to our directors and executive officers (including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions), at the same location on our web site identified above. The inclusion of our web site address in this proxy statement does not include or incorporate by reference the information on our web site into this proxy statement.

Required Vote

The nominees receiving the highest number of affirmative votes of the outstanding shares of the Common Stock present or represented by proxy and entitled to be voted for the nominees, shall each be elected as director. Each Proxy cannot be voted for a greater number of persons than three.

Recommendation of Our Board of Directors

Our board of directors recommends that stockholders vote FOR the election of the nominees listed above.

PROPOSAL TWO:

RATIFICATION OF APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM

Our audit committee has selected the firm of KPMG LLP, our independent registered public accounting firm during 2009, to serve in the same capacity for 2010, and we are asking stockholders to ratify this appointment. Stockholder ratification of such selection is not required by our Bylaws or other applicable legal requirement. However, our board of directors is submitting the selection of KPMG LLP to stockholders for ratification as a matter of good corporate practice. In the event that stockholders fail to ratify the selection, our audit committee will reconsider whether or not to retain that firm. Even if the selection is ratified, our audit committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if our audit committee believes that such a change would be in our and our stockholders’ best interests.

A representative of KPMG LLP is expected to be present at the Annual Meeting, will have the opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions.

Principal Accountant Fees and Services

The aggregate fees billed by KPMG LLP, our independent registered public accounting firm, for the years ended December 31, 2008 and 2009 were as follows:


Services Rendered	2008		2009

Audit Fees(1)	$	632,000	$	650,600
Audit-Related Fees(2)		—		—
Tax Fees(3)	$	204,000	$	213,000
All Other Fees(4)		—		—

Total	$	836,000	$	863,600


(1)		Fees billed for the audit of our annual financial statements for the years ended December 31, 2008 and 2009. Audit services for 2008 and 2009 include fees for the audit of annual financial statements, including internal control over financial reporting, quarterly reviews, statutory audits of foreign subsidiaries and consents on Form S-8.

(2)		None.

(3)		Tax fees for compliance, planning and expatriate tax services.

(4)		None.

Determination of Independence

Our audit committee has determined that the fees received by KPMG LLP for the non-audit services listed above are compatible with maintaining KPMG LLP’s independence.

Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors

Our audit committee pre-approves all audit and permissible non-audit services provided by our independent auditors. These services may include audit services, audit-related services, tax services and other services. Our audit committee has adopted a policy for the pre-approval of services provided by the independent auditors. Under the policy, pre-approval is generally provided at or near the beginning of the year to which the services pertain. Our audit committee may delegate pre-approval authority to one or more of its members. Such a member must report any decisions to our audit committee at the next scheduled meeting.

AUDIT COMMITTEE REPORT

The information contained in this Audit Committee Report shall not be deemed to be “soliciting material” or to be “filed” or incorporated by reference into any future filings with the Securities and Exchange Commission, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

The audit committee carries out its responsibilities pursuant to its written charter, and the members of the 2009 audit committee of RightNow’s board of directors have prepared and submitted this audit committee report. Each audit committee member is considered independent because each member satisfies the independence requirements for board members prescribed by the applicable rules of Nasdaq and Rule 10A-3 of the Securities Exchange Act of 1934, as amended.

Among other things, the audit committee oversees RightNow’s financial reporting process on behalf of the board of directors. Management has the primary responsibility for the financial statements and the reporting process, including the system of internal control over financial reporting. In fulfilling its oversight responsibilities, the audit committee reviewed and discussed with management RightNow’s audited financial statements in the Annual Report on Form 10-K for the year ended December 31, 2009, including a discussion of the quality, not just the acceptability, of the accounting principles; the reasonableness of significant judgments; the clarity of disclosures in the financial statements; and management’s assessment of RightNow’s internal control over financial reporting.

The audit committee also reviewed with the independent auditors, who are responsible for expressing an opinion on the conformity of those audited financial statements with generally accepted accounting principles, their judgments as to the quality, not just the acceptability, of RightNow’s accounting principles and such other matters as are required to be discussed with audit committees by Statement on Auditing Standards No. 61, Communication With Audit Committees, as may be modified or supplemented. In addition, the audit committee discussed with the independent auditors their independence from management and RightNow, and has received the written disclosures and the letter from the independent auditors required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor’s communications with the audit committee concerning independence. Throughout the year and prior to the performance of any such services the audit committee also considered the compatibility of potential non-audit services with the auditors’ independence.

The audit committee discussed with RightNow’s independent auditors their overall approach, scope and plans for the audit. At the conclusion of the audit, the audit committee met with the independent auditors, with and without management present, to discuss the results of their examination, their evaluation of RightNow’s internal control over financial reporting and the overall quality of RightNow’s financial reporting.

In reliance on the reviews and discussions referred to above, the audit committee recommended to the board of directors (and the board has approved) that the audited financial statements be included in the Annual Report on Form 10-K for the year ended December 31, 2009 for filing with the Securities and Exchange Commission.

The audit committee has also recommended, subject to stockholder approval, the selection of KPMG LLP to continue as RightNow’s independent auditors for 2010.

Submitted by the Audit Committee of

the Board of Directors

Richard E. Allen, Chair

Gregory M. Avis

Thomas W. Kendra

Executive Officers

The names of our executive officers, their ages and positions as of March 31, 2010 and biographical information about them are as follows:


Name	Age		Position

Greg R. Gianforte		48	Chairman, Chief Executive Officer and President
Marcus A. Bragg		35	Vice President and General Manager Americas
Joseph Brown		60	Vice President and General Manager EMEA
Susan J. Carstensen		47	Chief Operating Officer, Vice President and Assistant Secretary
Steven D. Daines		47	Vice President and General Manager Asia Pacific
Jeffrey C. Davison		45	Chief Financial Officer, Vice President and Treasurer
Jason Mittelstaedt		34	Chief Marketing Officer and Vice President of Marketing
Michael A. Myer		43	Chief Technology Officer and Vice President of Development
Alan A. Rassaby		54	Vice President of Legal and Risk Management, General Counsel and Secretary

The following is a brief description of the capacities in which each of our executive officers who is not also a director has served, and other biographical information. The biography of Mr. Gianforte appears earlier in this proxy statement under “Proposal One: Election of Directors — Nominees for Terms Ending Upon the 2013 Annual Meeting of Stockholders.”

Marcus A. Bragg, 35, has been our vice president and general manager of Americas since September 2008. Mr. Bragg joined us in 1998 as our very first employee. He has held several positions during his tenure, including customer support and solutions consulting, director of international technical operations, managing director of our United Kingdom office and, most recently, regional vice president of sales for our North American Western region. Mr. Bragg holds a B.A. degree in management and information systems from Trinity College and University.

Joseph Brown, 60, has been our vice president and general manager of Europe, Middle East and Africa since January 2007. Mr. Brown joined us in 2005 as vice president of Voice Solutions. Prior to that time, from May 1998 through February 2003, he was chief executive officer and general manager at Edify Corporation, a multi-channel contact center software company that delivered voice recognition and contact center software integrating e-mail, web, fax, voice and other communications channels. From January 1994 to February 1998, Mr. Brown was a senior vice president of Worldwide Field Operations at Auspex Systems, Inc., a company that developed, manufactured, sold and supported a line of high-performance UNIX/ Windows NT multi-protocol network file and data servers. Before that, Mr. Brown was the vice president of marketing for Unisys Corporation’s UNIX Systems Division, a worldwide information technology consulting services and solutions company. Mr. Brown has over 25 years of technology industry experience in sales and marketing organizations. Mr. Brown holds a Bachelor of Commerce degree from the University of Witwatersrand and an M.B.L. in general management from the University of South Africa.

Susan J. Carstensen, 47, has been our chief operating officer and vice president since January 2008. Prior to that time, Ms. Carstensen served as our chief financial officer and treasurer since October 1999 and has been our assistant secretary since October 2003. She served as one of our directors from October 1999 to April 2000 and as our secretary from October 1999 to October 2003. From 1995 to October 1999, Ms. Carstensen held various positions in finance and audit at Powerhouse Technologies, Inc., a diversified gaming technology company, including chief financial officer from 1997 until June 1999. Prior to joining Powerhouse, Ms. Carstensen spent three years in financial management for Martin Marietta Astronautics Group, an aerospace and defense contractor, and six years before that at Ernst & Young LLP. Ms. Carstensen holds B.S. and B.A. degrees in business and political science from Montana State University.

Steven D. Daines, 47, has been our vice president and general manager of Asia Pacific since June 2007. Since joining us in June 2000, Mr. Daines has served in the positions of vice president customer services and vice president North America sales. Prior to joining us, Mr. Daines spent 13 years with The Procter & Gamble Company (“P&G”), a provider of consumer products. He spent seven years with P&G managing U.S. operations, followed by six years based in China, leading their business expansion into greater China. Mr. Daines holds a B.S. degree in Chemical Engineering from Montana State University.

Jeffrey C. Davison, 45, has been our chief financial officer, vice president and treasurer since January 2008. Mr. Davison joined us in November 1999 as controller. In November 2000 he was appointed to vice president sales operations and served in that role until April 2006 when he was promoted to vice president finance and operations. Mr. Davison was the corporate controller for Powerhouse Technologies, a gaming technology company, from 1998 to 1999 and vice president finance and controller for United Tote Company and the Sunland Racetrack and Casino, both divisions of Powerhouse Technologies from 1995 to 1999. A CPA and graduate of Montana State University, Mr. Davison has previous experience in audit roles with KPMG LLP, an accounting firm, and PacifiCorp, a diversified utility company.

Jason Mittelstaedt, 34, has been our vice president of marketing since January 2006 and our chief marketing officer since March 3, 2008. Mr. Mittelstaedt has held several positions in marketing, including product management and corporate marketing, since joining us in 2000. Prior to 2000, Mr. Mittelstaedt held several positions at Intel Corporation, the world’s leading provider of microprocessors, including strategic planning and product marketing. He completed Harvard Business School’s General Management Program and has received his B.S. in Engineering Physics from Northwest Nazarene University.

Michael A. Myer, 43, has been our vice president of development since August 2000 and chief technology officer since July 2005. Prior to that time he served as our director of development from August 1998. From 1987 through August 1998, Mr. Myer held various positions in computer research and product development with AT&T Corp., Lucent Technologies (previously a subsidiary of AT&T Corp.) and Bell Labs Research, all telephony-related companies. Mr. Myer holds M.S. and B.S. degrees in computer science from Rutgers University and an AS degree in computer science from Penn State University.

Alan A. Rassaby, 54, has been our general counsel and secretary since October 2003 and our vice president of legal and risk management since June 2000. From 1998 to February 2000, Mr. Rassaby was the senior vice president, legal and administration for Powerhouse Technologies, Inc., a diversified gaming technology company, and senior vice president and general counsel of Anchor Gaming, after Anchor’s acquisition of Powerhouse. Prior to joining Powerhouse, Mr. Rassaby was a partner in the Australian law firm of Phillips Fox Lawyers from 1994 to December 1998. Mr. Rassaby holds Arts and Law degrees from the University of New South Wales in Australia and a Master of Laws from the London School of Economics and Political Science of London University. He is a member of the State Bars of Victoria and New South Wales in Australia, and of Oregon in the United States.

Our executive officers are elected by our board of directors on an annual basis and serve at the discretion of our board of directors until their successors have been duly elected and qualified or until their earlier resignation or removal.

Executive Compensation

Compensation Discussion and Analysis

The following discussion and analysis of our compensation practices and related compensation information should be read in conjunction with the Summary Compensation table and other tables included in this Proxy Statement, as well as our financial statements and management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2009. The following discussion includes statements of judgment and forward-looking statements that involve risks and uncertainties. These forward-looking statements are based on our current expectations, estimates and projections about our industry, our business, compensation, management’s beliefs and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as “anticipates,” “expects,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “may,” “will,” “should,” “would,” “could,” “potential,” “continue,” “ongoing,” similar expressions, and variations or negatives of these words and include, but are not limited to, statements regarding projected performance and compensation. Actual results could differ significantly from those projected in the forward-looking statements as a result of certain factors, including, but not limited to, the risk factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2009. We assume no obligation to update the forward-looking statements or such risk factors.

Introduction

Role of Compensation Committee

It is the responsibility of the compensation committee of our board of directors to oversee our general compensation policies; to determine the compensation to be paid to our chief executive officer; to make recommendations to the board of directors with respect to the compensation to be paid each year to our other executive officers; to oversee our compensation policies and practices as they relate to our risk management and to establish, review and approve director compensation. The three broad components of our executive officer compensation are base salary, cash incentive awards and long-term equity-based incentive awards. The compensation committee periodically reviews total compensation levels and the allocation of compensation among these three components for each of our executive officers in the context of our overall compensation philosophy. The compensation committee also periodically reviews the total compensation paid to each of our directors, having regard to each director’s level of contribution. Our directors are currently compensated entirely through equity-based awards. Below is a description of the policies and processes that govern the compensation paid to our executive officers and directors, as reflected in the accompanying compensation tables.

General Compensation Philosophy for Executive Officers

We operate in a highly competitive and rapidly changing sector within the high technology industry where competition for executive talent is intense. The compensation committee believes that our compensation programs for executive officers should: a) be designed to attract, motivate and retain talented executives, b) be competitive and c) reward individuals based on the achievement of designated financial performance targets and on the individual executive’s contribution. Within this philosophy, the compensation committee’s objectives are to:


	•	Offer a total compensation program that takes into consideration the compensation practices of other high technology companies of similar size with which we compete for executive talent;

	•	Provide annual cash incentive awards that take into account our overall financial performance relative to designated corporate objectives; and

	•	Strengthen the alignment of the interests of executive officers with those of stockholders by providing significant equity-based, long-term incentive awards.

Compensation Components and Process

We believe executive compensation should both reflect market changes and reward high performance. The compensation committee’s conclusions on the compensation levels for our executive officers are based in part on executive compensation data drawn from nationally recognized surveys and from peer companies, and in part from a review of individual performance during the previous year.

When evaluating market data for compensation comparison purposes, the compensation committee seeks to obtain data from organizations considered to be comparable to us from a variety of perspectives, in order to ensure comparisons include both relevant competitive labor markets for talent as well as business competitors. For 2007, 2008 and 2009, the compensation committee engaged Towers Perrin, a nationally recognized compensation consulting company, to provide data on market compensation levels for executives in comparable positions at comparable companies. Towers Perrin was engaged by, and reported directly to, our compensation committee and performed no other services for us during this period. Our compensation committee members interacted directly with representatives from Towers Perrin. During the process of determining 2009 compensation levels for our executives, our vice president and general counsel, Alan Rassaby, acted as liaison between the compensation committee and Towers Perrin, and communicated to Towers Perrin any requests made by our compensation committee for additional or refined information. Our former chief financial officer, Susan Carstensen, acted as liaison between our compensation committee and third-party compensation advisors during 2007 and part of 2008, until her appointment as our chief operating officer on January 29, 2008. Mr. Rassaby acted as liaison between our compensation committee and third-party compensation advisors during the remainder of 2008 and 2009, and we expect that he will continue to act as such a liaison between our compensation committee and third-party compensation advisors we select to use during 2010. As liaison, both Mr. Rassaby, and before that Ms. Carstensen, facilitated communications between the compensation committee and our third party compensation advisers as directed by the compensation committee.

For market data on cash compensation for 2009, which includes base salary and the annual cash incentive compensation, published survey data were considered from three sources: 1) the Culpepper 2008 Compensation Survey, scoped to include software companies with annual revenues between $100 million and $250 million; 2) Radford’s 2008 Hi-technology Compensation Survey, scoped for companies with annual revenues between $50 million and $199 million; and 3) Watson Wyatt’s 2008/2009 Industry Report on Top Management Compensation, which data was regressed at $165 million in annual sales to correlate with our approximate size. Data from each source were equally blended, resulting in a 33% weighting to general industry data and a 67% weighting to the software/high-technology industry. We considered the same published survey data sources during 2007 and 2008.

Information on long-term incentive compensation for 2009 was obtained from Towers Perrin’s Long-Term Incentive database, focusing on companies across all industries with annual sales less than $1 billion. Long-term incentive dollar values were discounted by 15%, consistent with the expected decreases in 2009 long-term incentive grant values reported by general industry (which reflected a discount of approximately 15%) and high technology companies (which reflected a discount of approximately 13%) at the time of the study. The long-term incentives were expressed as a percentage of base salary and were added to the cash compensation information from each survey to arrive at an estimate of total compensation. The totals from both surveys were averaged to arrive at an overall market estimate of total compensation. We considered the same long-term incentive compensation data source during 2007 and 2008.

In addition, in 2007, 2008 and 2009, we obtained compensation information from publicly-traded peer companies to provide a secondary data point in determining market rates for total compensation. In developing a list of 38 publicly-traded peer companies for 2009, Towers Perrin reviewed the 2008 peer company list, removed 12 companies that were no longer publicly-traded and, after consultation with the compensation

committee, added 10 companies whose businesses were considered sufficiently similar to our business to provide a reasonable basis for comparison. The 2009 peer companies consisted of:


Actuate Corp Advent Software, Inc. ANSYS, Inc. Arbitron Inc. Art Technology Group, Inc. Aspen Technology, Inc. Autobytel Inc. Computer Programs & Systems, Inc. Concur Technologies, Inc. DealerTrack Holdings, Inc. Digital Angel Corp Epicor Software Corp Interwoven Inc. LivePerson, Inc.		Macrovision Solutions Corp Manhattan Associates Inc. NetSuite Inc. Omniture, Inc. Open TV Corp Pegasystems Inc. PFSweb, Inc. Progress Software Corp Radiant Systems, Inc. Renaissance Learning Inc. S1 Corp Salesforce.com, Inc. Sapient Corp SI International Inc.		SuccessFactors, Inc. SupportSoft, Inc. Synaptics Inc. Synchronoss Technologies Inc. Taleo Corp TeleCommunication Systems Inc. Ultimate Software Group Inc. Unica Corp Vignette Corp Vocus Inc.

We believe the combination of published survey data and data from the proxy filings of peer companies allows us to assess relevant external market pay practices and to understand the range of pay practices occurring in comparable markets. These external market pay practices help inform us on the competitiveness of our compensation programs. The objective of this process is to gain a general understanding of compensation practices at other companies for the same or similar positions, rather than to identify a target or benchmark range of payment. Our compensation committee does not target compensation to fall within a specified range against the data, either for an individual officer or for the executive officers as a group (for example, we do not target the 25th to 75th percentile), as the compensation committee does not believe that this is meaningful due to the multiplicity of factors that go into the determination of compensation. Rather, the published survey data and data from the proxy filings of peer companies are inputs only into a process that is designed to ensure that our compensation is sufficiently attractive to enable us to attract, motivate and retain executives. Our compensation committee also considers the scope of each executive officer’s experience and responsibilities, the executive’s performance during the previous year, and tally sheet data showing the history of compensation and stock option awards for each executive officer. Relevant experience, broad scope of responsibility and strong performance during the previous year will likely correlate with higher compensation. The historical tally sheets provide the compensation committee with an understanding of the executive’s historical compensation progression. For example, an executive who has recently received a substantial pay increase might be progressed more slowly than an executive who has not received a compensation adjustment for some time.

In determining the amounts payable under individual components of an officer’s remuneration, the compensation committee seeks to develop a compensation package that is attractive and competitive in terms of total compensation, having regard both to cash and equity. The compensation committee also carefully considers the mix between the individual components. The compensation committee believes that a significant portion of an officer’s potential income should be at risk if the Company fails to meet its financial plan, or fails to enhance shareholder value. Accordingly, the compensation committee tries to ensure that there is an appropriate balance between base, cash incentive and long-term equity incentive components to ensure a risk/reward profile that is consistent with the Company’s compensation philosophy. Finally, in determining the mix of components, we take into account market data for each position, recognizing that some positions are more highly leveraged than others (that is, a greater portion of total compensation is at risk).

Each of our executive officers, except for our chief executive officer, undergoes an annual performance review with his or her supervisor. During such review, the executive officer and his or her supervisor assess performance during the year against objectives set at the beginning of the year, taking into account other factors that may not have been anticipated when the objectives were first set. The executive officer and his or her supervisor next agree on a personal business plan for the following year. The personal business plan is intended to align with our corporate strategic goals and is used to determine if the executive officer has met

performance objectives when determining cash incentive plan attainment. This is the same process that we follow to review the performance of all of our employees.

During 2008, our chief financial officer, chief operating officer and our general counsel reported directly to our chief executive officer, Mr. Gianforte. All of our other executive officers reported directly to our chief operating officer, Ms. Carstensen. Mr. Gianforte and Ms. Carstensen conducted a performance review with each of their reporting executive officers early in January 2009. Additionally, Mr. Gianforte met with Ms. Carstensen to review each of her reporting officers’ final performance reviews. To assist our compensation committee in reviewing executive officer performance in 2008 for 2009 compensation purposes, our chief executive officer and chief operating officer provided the compensation committee with their analyses of the 2008 performance and potential of each executive officer reporting to them, and made recommendations based on how well each executive officer executed on his or her individual performance plan while also taking into account compensation paid by our market peer companies. The compensation committee then approved the compensation paid to our executive officers. This is the same process that we followed in setting each executive officer’s 2010 compensation.

In the case of our chief executive officer, the chairman of the compensation committee obtains input annually from each board member on our chief executive officer’s performance during the previously completed year, using a multiple question format and a five point rating scale. The compensation committee also takes into account our chief executive officer’s success in meeting the corporate goals and objectives approved by the board at the beginning of the relevant year. The compensation committee then approves the compensation paid to our chief executive officer. This is the same process that we followed in setting our chief executive officer’s 2007 and 2008 compensation. We also followed this process in setting our chief executive officer’s 2010 compensation.

Summary Compensation Table


													Change in
													Pension
													Value and
													Nonqualified
											Non-Equity		Deferred
							Stock		Option		Incentive Plan		Compensation		All Other
			Salary		Bonus		Awards		Awards		Compensation		Earnings		Compensation		Total
Name and Principal Position	Year		($)		($)		($)		($)(4)		(5)		($)		($)(6)		($)

Greg R. Gianforte		2009	$	325,000	$	—	$	—	$	568,738	$	253,942	$	—	$	10,082	$	1,157,762
CEO		2008		325,000		—		—		—		160,498		—		9,231		494,729
		2007		300,000		—		—		—		88,864		—		8,758		397,622
Jeffrey C. Davison		2009		225,000		—		—		386,742		103,577		—		7,350		722,669
CFO, VP and Treasurer(1)		2008		197,846		—		—		409,410		65,799		—		9,231		682,286
		2007		170,000		—		—		40,825		65,033		—		6,471		282,329
Marcus Bragg		2009		225,000		—		—		363,992		213,019		—		2,872		804,883
VP and General Manager		2008		212,000		—		—		354,142		217,403		—		2,655		786,200
Americas(2)		2007		200,000		—		—		30,480		113,951		—		1,610		346,041
Susan J. Carstensen		2009		240,000		—		—		386,742		159,323		—		7,350		793,415
COO, VP and Former CFO(3)		2008		238,564		—		—		545,880		105,278		—		9,231		898,953
		2007		220,000		—		—		262,398		50,919		—		6,419		539,736
Alan A. Rassaby		2009		225,000		—		—		386,742		91,419		—		10,082		713,243
VP and General Counsel		2008		225,000		—		—		163,764		59,219		—		9,231		457,214
		2007		220,000		—		—		262,398		37,767		—		8,292		528,457


(1)		Mr. Davison was appointed chief financial officer, vice president and treasurer on January 29, 2008. The above figures for Mr. Davison reflect his compensation earned during 2007 as a non-executive officer.

(2)		Mr. Bragg was appointed vice president and general manager Americas on August 29, 2008. The above figures for Mr. Bragg reflect his compensation earned during part of 2008 and all of 2007 as a non-executive officer.

(3)		Ms. Carstensen served as chief financial officer, vice president, treasurer and assistant secretary for all of 2007 and was appointed chief operating officer January 29, 2008 upon resignation of her positions as chief financial officer and treasurer.


(4)		Excludes the effect of forfeiture assumptions. The fair value of option awards shown are calculated in accordance with Topic 718, Compensation-Stock Compensation and represent the aggregate grant date fair value of option awards granted during the year. See Note 1(q) and Note 10, Stock-Based Compensation, in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K filed March 9, 2010 for the relevant assumptions used to determine the valuation of our option awards.

(5)		See the discussion under Incentive Plan Awards for further description of our cash-based incentive plan awards.

(6)		Includes matching contributions by us under our 401(k) savings plan. All full-time equivalent employees are eligible for our 401(k) savings plan. Also includes airfare, meals and lodging for spouse attendance at our annual sales meeting.

Principal Elements of Executive Compensation

Base Salary. While the compensation committee did review base salaries and evaluate the 2008 performance of all executive officers, due to the downturn in the economy, the compensation committee decided with one exception not to increase the base salaries of our executive officers in 2009. The exception was our chief financial officer, Mr. Davison, who received a 12.5% increase solely to better align him with competitive rates for his position, having regard to the survey data described above.

Mr. Gianforte received an 8% increase in his base salary at the beginning of 2008. At Mr. Gianforte’s request, he received no increase in base salary in 2007. For other named executive officers, base salaries for 2008 and 2007 were increased by a range of 2% to 16% and 5% to 16%, respectively.

Discretionary Bonus. We did not award discretionary bonuses to our named executive officers during 2009, 2008 or 2007.

Annual Cash Incentive Plan. In parallel with its review of base salaries for executive officers, the compensation committee considers the design and structure of the executive officer annual cash incentive plan. To reinforce the attainment of our goals, we believe that a substantial portion of the annual compensation of each executive officer should be in the form of variable incentive pay.

Our annual cash incentive plan is heavily weighted toward the achievement of financial targets approved by our board of directors. Our compensation committee believes that the achievement of annual financial metrics serves to align our executives’ performance goals with the creation of stockholder value. For 2009, executive officers’ annual cash incentive potential was based on the following financial targets, excluding effects of acquisitions (which we exclude because they cannot be reliably factored into financial planning at the time that the Board adopts the financial targets on which the cash incentive plan is based):


	•	Sales, which is a measure of the top line growth of the business and which, we believe, to be a leading indicator of our growth potential. We defined ‘sales’ as annual recurring revenue and professional services sales.

	•	Operating earnings, which is a measure of our profitability under generally accepted operating principles that we believe directly drives stockholder value through its impact on earnings per share. For our cash incentive plan, we use operating earnings before stock-based compensation expense, because we believe the amount of stock-based compensation expense varies from period-to-period based on factors that are not, in management’s view, indicative of our underlying operating performance. We believe this measure is important because the actions of management can have a significant impact upon operating earnings.

	•	Recurring revenue per employee, which we believe assists us to focus on the profitability of our transactions.

The 2009 cash incentive plan for executive officers other than the general managers, was designed as follows:


	•	Incentive opportunities were established as designated dollar amounts, not as a percentage of salary;


	•	80% of the overall incentive opportunity was based on the attainment of corporate goals for sales, operating earnings and recurring revenue per employee for each of our four quarters, and was paid in cash after the end of each quarter;

	•	20% of the overall incentive opportunity was based on an assessment of the officer’s 2009 performance, having regard to the objectives documented in the executive’s personal business plan, and was paid in cash after the end of the year.

The 2009 cash incentive plan was structured differently from the 2008 and 2007 plans. One difference is that we replaced one of our measures, cash from operations, with recurring revenue per employee. We believe that use of this metric better assisted us to focus on the profitability of our transactions. The second difference is that the 2009 plan paid target performance at 20% per quarter, whereas in 2008 and 2007, it was paid at 15% for each of the first three quarters and 35% for annual performance. We believe this change helped us focus better on consistent quarterly performance. In 2010, to align the our objectives of accelerating growth and increasing margins, our compensation committee has selected two of the metrics that we used in the 2009 plan — sales and operating earnings.

The quarterly and annual components of the incentive plan were triggered when we achieved a minimum level of sales, operating earnings or recurring revenue per employee. The compensation committee determines the minimum, target levels and maximum for each metric, based on known or expected business trends and the perceived difficulty in attaining each goal. Achievement below the minimum target for sales, operating earnings and recurring revenue per employee resulted in a zero percent payout, while achievement at the minimum resulted in a payout of 50% of the executive officer’s designated dollar amount. Excluding the 20% individual performance portion of the incentive plan, the maximum payout was 200% of the executive officer’s designated dollar amount.

In the case of general managers, who are our executive officers responsible for regional financial performance, we adopted additional plan elements that were designed to reward the general manager for regional sales growth and profitability. We believe that the additional plan elements were necessary in order to reflect the geographical nature of each general manager’s role. 40% of the target incentive for general managers was payable on the basis of our cash incentive plan, 50% was based on the regional financial plan applicable to the general manager and 10% was based on an assessment of the general manager’s 2009 performance, having regard to the objectives documented in the general manager’s personal business plan. General managers were given both a sales and quarterly contribution margin target. A general manager who achieved both targets was to be paid 100% of available target pay. Achievement of a lower contribution target had the effect of proportionately reducing the payout while achievement of a higher contribution margin had the effect of proportionately increasing the available incentive. For the sales target, two calculations were made — one based on year-to-date performance against year-to-date target and the other based on quarterly performance against a quarterly target. The general manager was paid the higher of the two calculations. The purpose of the dual calculation was both to reward early achievement and to provide a continuing incentive throughout the year. Under the regional financial plan, the minimum payment started at zero, increased in a straight line to the target, and then accelerated without a cap for over-achievement.

In general, targeted levels of performance for 2009 were set by our compensation committee with the intention of requiring meaningful improvements in performance over 2008 actual results. In some cases, the minimum level of performance required to earn a payout represented a significant challenge. Overall, we believe performance required to achieve a minimum payout was attainable, performance required to earn a payout at the target was achievable but challenging and performance required to qualify for maximum payouts represented outstanding achievement. Actual goal achievement for 2009 under our executive officer cash incentive plan, and annual incentives earned by our named executive officers, ranged from approximately 67% to 125% of target.

Operating earnings targets before stock-based compensation during 2009 for the annual cash incentive plan were $.999 million for the first quarter of 2009, $2.386 million for the second quarter of 2009, $3.563 million for the third quarter of 2009 and $3.714 million for the fourth quarter of 2009.

We do not publicly disclose the specific performance target levels and related criteria as they relate to sales and recurring revenue per employee, because they constitute highly confidential commercial or financial information. We believe that disclosing such target levels and related criteria would provide competitors with insights into our operational strategy and would therefore cause us substantial competitive harm.

Long-Term Equity-Based Incentive Awards. The goal of our long-term, equity-based incentive awards is to serve as a long-term staff retention vehicle by aligning the interests of executive officers with stockholders and providing each executive officer with a significant incentive to manage from the perspective of an owner with an equity stake in the business. The compensation committee administers our equity-based incentive plans for executive officers, determines the size of long-term, equity-based incentives according to each executive’s position and sets a level it considers appropriate to create a meaningful opportunity for stock ownership. In addition, the compensation committee generally takes into account an individual’s recent performance, his or her potential for future responsibility and promotion, data provided by Towers Perrin on comparable awards made to individuals in similar positions at survey companies and the number of unvested options held by each individual at the time of any new grant. However, there is no set formula for determining the size of a stock option award. Our chief executive officer historically has made recommendations to our compensation committee regarding the amount of stock options and other compensation to grant to our other named executives based upon his assessment of their performance, and may continue to do so in the future. Our compensation committee takes such recommendations into account when it approves stock option grants and other compensation. We do not require a minimum stock ownership by our executive officers, but the compensation committee considers an executive officer’s existing stock holdings in determining the size of awards. Our executive officers are not permitted to hedge the economic risk of ownership of our stock.

Under our 2004 Equity Incentive Plan, we have the ability to grant different forms of equity compensation, including stock options, stock appreciation rights, restricted stock and restricted stock units, performance awards and other stock-based awards. To date, we have primarily chosen to use stock options to provide long-term incentives because we believe they best align with our objectives of providing incentives that are commensurate with total stockholder return and employee retention. Stock options provide actual economic value to the executive officer if he or she remains employed by us during the vesting period, and then only if the market price of our shares appreciates over the option term. The fair value of option awards shown for stock options in the summary compensation table are calculated in accordance with Topic 718, Compensation-Stock Compensation and represent the aggregate grant date fair value of option awards during 2009, 2008 and 2007, respectively.

Stock options motivate executive officers by providing substantial upside compensation even though the entire amount of potential compensation is at risk. The compensation committee periodically considers the use of alternative equity compensation vehicles, and is likely to continue to review its position on this issue. In the future, we may choose to grant different forms of equity compensation particularly if the use of such different forms of compensation become more prevalent at companies with which we compete or from which we intend to recruit personnel. Other factors that may lead us to provide different forms of equity compensation include, but are not limited to, the executives’ perceived value of one form of equity compensation over another, the potential effect of stockholder dilution and the financial statement cost of one form of equity compensation over the other. Under our 2004 Employee Stock Purchase Plan, we also provide all employees who work more than 20 hours per week with the ability to purchase shares of common stock, through payroll deduction, at a pre-determined discount to the closing price at the end of a six month purchase period. For the two purchase periods in 2009, our board of directors set the maximum permitted payroll deduction for the purposes of the Employee Stock Purchase Plan at 10% of salary, and set the pre-determined discount at 5% of the closing price at the end of the purchase period.

Stock options provided to executive officers are typically granted at or near the beginning of each year in conjunction with the compensation committee’s meeting to review their individual performance, unless the executive officer is a new hire or other individual performance considerations or changes in responsibility are brought to the attention of our compensation committee during the course of the year. This review takes place, and option grants are generally made, at regularly scheduled meetings of the compensation committee and board of directors. Board and committee meetings are usually scheduled well in advance. Our board of

directors and compensation committee intend to continue this practice of approving stock-based awards at regularly scheduled meetings, unless earlier approval is required for new hires, new performance considerations or retention purposes, or unless a regularly scheduled meeting needs to be rearranged for another date. We have not timed, nor do we intend to time, our release of material non-public information for the purpose of affecting the value of executive compensation. In accordance with our 2004 Equity Incentive Plan, the exercise price of all options is set at the closing price of our common stock as reported by the Nasdaq Global Market on the day of grant. Our board of directors or compensation committee may also approve stock option grants by unanimous written consent. In such cases, the date of grant is the last signature date as noted on the unanimous written consent. Option grants to non-executive employees typically occur annually in conjunction with their performance review, or shortly after hire, upon the next scheduled meeting of the board of directors. Option awards granted prior to our initial public offering in August 2004 were granted at the fair market value of our stock, based upon annual independent appraisals.

Material terms of options granted to our named executive officers in 2009 included: a) exercise price equal to the closing market value as quoted by the Nasdaq Global Market on the date of grant; b) vesting in a series of eight equal installments over a four-year period, contingent on the executive officer’s continued service to the Company; c) a term no longer than ten years; and d) vesting acceleration in the event of termination of employment without cause, or termination within 12 months following a change in control. Accordingly, options provide a return to the executive officer only if he or she remains employed by us during the vesting period, and then only if the market price of the shares appreciates over the option term.

If the board of directors determined that an executive officer has engaged in fraudulent or intentional misconduct, and if the misconduct resulted in a significant restatement of our financial results, we would, among other disciplinary action, seek reimbursement of any portion of performance-based or incentive compensation paid or awarded to the executive that is greater than would have been paid or awarded if calculated based on the restated financial results. This remedy would be in addition to, and not in lieu of, other disciplinary actions and any actions imposed by law enforcement agencies, regulators or other authorities.

All of our executive officers received stock option grants in 2009. The size of the 2009 grants to each executive reflected the compensation committee’s view of the executive’s level of responsibility and potential, and the survey data for executives in similar positions. All of our executive officers, with the exception of our chief executive officer, received stock option grants in 2008 and 2007. At its meeting on February 10, 2009, the compensation committee granted stock options to all executive officers, including a first-time stock option grant to our chief executive officer of 125,000 shares. This stock option grant was awarded to help ensure continued alignment between the interests of our chief executive officer and the interests of our stockholders.

Grants of Plan-Based Awards


									Estimated Future Payouts Under Equity Incentive Plan Awards
															All
															Other
															Stock		All
															Awards:		Other
															Number		Option				Grant
															of		Awards:		Exercise		Date
															Shares		Number		or Base		Fair
			Estimated Future Payouts Under												of		of		Price of		Value
			Non-Equity Incentive Plan												Stock		Securities		Option		of
			Awards												or		Underlying		Awards		Option
	Grant		Threshold		Target		Maximum		Threshold		Target		Maximum		Units		Options		($/Sh)		Awards
Name	Date		($)		($)		($)		(#)		(#)		(#)		(#)		(#)		(1)		($)(2)

Greg R. Gianforte		2/10/09	$	—	$	250,000	$	450,000		—		—		—		—		125,000	$	8.38	$	568,738
CEO
Jeffrey C. Davison		2/10/09		—		100,000		180,000		—		—		—		—		85,000		8.38		386,742
CFO, VP and Treasurer(3)
Marcus Bragg		2/10/09		—		175,000		N/A		—		—		—		—		80,000		8.38		363,992
VP and General Manager Americas(4)(5)
Susan J. Carstensen		2/10/09		—		160,000		288,000		—		—		—		—		85,000		8.38		386,742
COO, VP and Former CFO(6)
Alan A. Rassaby		2/10/09		—		90,000		162,000		—		—		—		—		85,000		8.38		386,742
VP and General Counsel


(1)		The exercise price of the option award is equal to the closing price of our common stock as reported by the Nasdaq Global Market on the date of grant.

(2)		See Note 1(q) and Note 10, Stock-Based Compensation, in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K filed March 9, 2010 for the relevant assumptions used to determine the valuation of our option awards.

(3)		Mr. Davison was appointed chief financial officer, vice president and treasurer on January 29, 2008.

(4)		Mr. Bragg was appointed vice president and general manager Americas on August 29, 2008.

(5)		General managers do not have a cap under our Non-Equity Incentive Plan Awards. Refer to Annual Cash Incentive section above for more details.

(6)		Ms. Carstensen was appointed chief operating officer on January 29, 2008.

Outstanding Equity Awards at Fiscal Year-End

Stock Awards

Equity

Incentive

Plan

Option Awards

Equity

Awards:

Equity

Incentive

Market or

Incentive

Plan

Payout

Plan

Awards:

Value of

Awards:

Number

Market

Number of

Unearned

Number

Value of

Unearned

Shares,

Shares or

Shares,

Units

Number of

Securities

Units of

Units

or Other

Securities

Underlying

Stock

or Other

Rights

Underlying

Unexercised

Option

That

Rights

That Have

Unexercised

Unearned

Exercise

Option

Have Not

That Have

Not

Options (#)

Options

Price

Expiration

Vested

Not

Vested

Name

Exercisable(1)

Unexercisable(1)

(#)

($)

Date(2)

(#)

($)

Vested (#)

($)

Greg R. Gianforte

15,625

109,375

—

8.38

2/10/19

—

CEO

Jeffrey C. Davison

10,000

—

13.87

10/05/15

—

CFO, VP and Treasurer

26,250

3,750

—

14.17

4/17/16

—

3,125

1,875

—

16.66

2/07/17

—

28,125

46,875

—

10.93

2/05/18

—

10,625

74,375

—

8.38

2/10/19

—


											Stock Awards
																	Equity
																	Incentive
																	Plan
	Option Awards														Equity		Awards:
					Equity										Incentive		Market or
					Incentive										Plan		Payout
					Plan										Awards:		Value of
					Awards:						Number		Market		Number of		Unearned
					Number						of		Value of		Unearned		Shares,
					of						Shares or		Shares or		Shares,		Units
	Number of		Number of		Securities						Units of		Units of		Units		or Other
	Securities		Securities		Underlying						Stock		Stock		or Other		Rights
	Underlying		Underlying		Unexercised		Option				That		That		Rights		That Have
	Unexercised		Unexercised		Unearned		Exercise		Option		Have Not		Have Not		That Have		Not
	Options (#)		Options (#)		Options		Price		Expiration		Vested		Vested		Not		Vested
Name	Exercisable(1)		Unexercisable(1)		(#)		($)		Date(2)		(#)		($)		Vested (#)		($)

Marcus Bragg		832		—		—		7.35		6/21/14		—		—		—		—
VP & General		5,000		—		—		13.75		10/27/14		—		—		—		—
Manager — Americas		10,000		—		—		13.87		10/05/15		—		—		—		—
		8,750		1,250		—		16.31		5/31/16		—		—		—		—
		2,500		1,500		—		16.66		2/07/17		—		—		—		—
		750		1,250		—		14.33		6/06/18		—		—		—		—
		250		750		—		14.51		7/23/18		—		—		—		—
		12,500		37,500		—		14.18		9/03/18		—		—		—		—
		10,000		70,000		—		8.38		2/10/19		—		—		—		—
Susan J. Carstensen		23,333		—		—		1.50		2/13/12		—		—		—		—
COO, VP and Former CFO		133,333		—		—		1.50		1/29/13		—		—		—		—
		40,000		—		—		12.81		2/09/15		—		—		—		—
		35,000		5,000		—		19.25		1/19/16		—		—		—		—
		18,750		11,250		—		16.66		2/07/17		—		—		—		—
		37,500		62,500		—		10.93		2/05/18		—		—		—		—
		10,625		74,375		—		8.38		2/10/19		—		—		—		—
Alan A. Rassaby		1,646		—		—		1.50		3/19/13		—		—		—		—
VP — General Counsel		1,935		—		—		1.50		4/30/13		—		—		—		—
		66,666		—		—		7.35		6/21/14		—		—		—		—
		30,000		—		—		12.81		2/14/15		—		—		—		—
		26,250		3,750		—		19.25		1/19/16		—		—		—		—
		18,750		11,250		—		16.66		2/07/17		—		—		—		—
		11,250		18,750		—		10.93		2/05/18		—		—		—		—
		10,625		74,375		—		8.38		2/10/19		—		—		—		—


(1)		Options become exercisable in eight equal installments every six months following the date of grant.

(2)		The expiration date of each option award is ten years after the date of grant.

Option Exercises and Stock Vested


	Option Awards				Stock Awards
	Number of				Number of
	Shares				Shares
	Acquired		Value Realized		Acquired
	on Exercise		on Exercise		on Vesting		Value Realized
Name	(#)		($)(1)		(#)		on Vesting ($)

Greg R. Gianforte		—	$	—		—	$	—
CEO
Jeffrey C. Davison		—		—		—		—
CFO, VP and Treasurer
Marcus Bragg		—		—		—		—
VP & General Manager — Americas
Susan J. Carstensen		35,660		223,588		—		—
COO, VP and Former CFO
Alan A. Rassaby		—		—		—		—
VP — General Counsel


(1)		Represents the difference between the exercise price and the fair market value of our common stock on the date of exercise.

Perquisites

Our executives are entitled to the same perquisites as all employees and generally do not receive additional perquisites because they hold executive positions. All employees that participate in our 401(k) plan receive a matching contribution from us in the amount of 50% of the employee’s first 6% of contribution. Each year, we hold a sales meeting at an off-site location for our top performers. Participants may be accompanied by their spouse or a guest, the cost of which is paid by us. In 2009, three of our named executive officers made the trip and were accompanied by their spouses. All full-time employees are eligible to participate in our Employee Stock Purchase Plan, which in 2009, 2008 and 2007 provided a 5% discount from market price on the last day of the purchase period. Our health and life insurance plans are the same for all employees. We typically offer reimbursement to newly hired executive officers for relocation costs.

Post-Employment Compensation

We do not provide pension arrangements, non-qualified deferred compensation or post-retirement health coverage for our executives or employees. All full-time employees are eligible to participate in our 401(k) contributory defined contribution plan. In any plan year, we will contribute to each participant’s account a matching contribution equal to 50% of the first 6% of the participant’s compensation that has been contributed to the plan. All of our executive officers except Mr. Bragg participated in the plan during 2009, 2008 and 2007 and received matching contributions.

Employment Contracts, Termination of Employment and Change-In-Control Agreements

Employment Contracts. We do not have employment contracts with any of our named executive officers.

Termination Without Cause or For Good Reason Following Change in Control. On April 20, 2004, our board of directors adopted a policy applicable to all of the members of our executive management in the event of a change or loss of position within 12 months following a change-in-control transaction. Under the policy, our chief executive officer will be entitled to receive a minimum of twelve months’ salary and bonus as severance and any then-unvested options that were granted to him after April 20, 2004 will be accelerated in full and become fully vested. The policy also provides that any member of executive management other than our chief executive officer will be entitled to receive a minimum of six months’ salary and bonus as severance in the form of salary continuation, and any then-unvested options that were granted to him or her after April 20, 2004, and while he or she was an executive officer, will be accelerated in full and become fully vested. Each executive officer has an employment offer letter that contains similar language to the policy. In addition, all of our option agreements with our named executive officers in respect of options under our 2004 Equity Incentive Plan provide that upon the occurrence of a change-in-control transaction, all of the executive officer’s unvested option shares will be completely vested, unless the option is assumed by the acquirer. If assumed by the acquirer, the option will become completely vested if within twelve months of the change-in-control transaction the executive officer is terminated without cause or terminates his or her employment for good reason. A change-in-control transaction includes (i) a transaction or series of transactions in which any person, entity or group becomes the beneficial owner of 50% or more of the combined voting power of our outstanding securities, (ii) a transaction in which our directors cease to constitute a majority of the board of directors, (iii) a consolidation or merger in which we are not the surviving entity or in which our stockholders do not have the same proportionate ownership in the surviving entity after the merger as they did immediately prior to the merger, the sale, lease, exchange or other transfer of all or substantially all of our assets, our liquidation or dissolution or (iv) any transaction that a majority of our directors determines constitutes a change-in-control. Cause includes termination of employment based upon (i) the willful and continued failure substantially to perform one’s duties and obligations (other than due to physical or mental incapacity or good reason), (ii) a conviction or plea bargain in connection with the actual or alleged commission of a felony or gross misdemeanor involving moral turpitude, fraud or misappropriation of funds or (iii) the willful engagement in misconduct which causes us, our employees or our clients substantial monetary or other injury. Good reason includes terminating one’s employment based upon (i) being assigned employment duties or responsibilities which are not substantially comparable in responsibility and status to the

employment duties and responsibilities held immediately prior to the change-in-control transaction, (ii) a reduction in base salary as in effect immediately prior to the change-in-control transaction or (iii) being required to relocate offices more than 50 miles from one’s office location immediately prior to the change-in-control transaction.

Terminations Without Cause — No Change of Control. Employment offer letters for Ms. Carstensen and Messrs. Bragg, Davison and Rassaby, provide that if the executive officer’s employment is terminated other than for cause, he or she will be entitled to receive six months salary and bonus as severance in the form of salary continuation, and will be entitled to a 12.5% accelerated vesting of then unvested option shares under outstanding stock options.

Summary Termination Table. The following table summarizes each executive officer’s present estimated entitlement to severance and the potential value of stock option acceleration upon a termination other than for cause, and a termination other than for cause or for good reason following a change in control, as if such termination occurred on January 1, 2010. The potential value of accelerated stock option vesting is based on the closing price of our stock on January 1, 2010 and is in addition to the value of vested stock options shown in the “Option Exercises and Stock Vested” table.


	Termination Other than for Cause —								Termination within 12 Months after
	No Change of Control								a Change in Control
					Number								Number
					of						Value		of
			Value of		Options						of		Options
			Accelerated		Subject to						Accelerated		Subject to
			Option		Accelerated						Option		Accelerated
Name	Cash		Vesting(1)		Vesting		Total ($)		Cash		Vesting(2)		Vesting		Total ($)

Greg R. Gianforte	$	N/A		—		—	$	N/A	$	575,000	$	983,281		109,375	$	1,558,281
Jeffrey C. Davison		162,500		122,980		15,859		285,480		162,500		983,837		126,875		1,146,337
Marcus Bragg		200,000		94,658		14,031		294,658		200,000		757,260		112,250		957,260
Susan J. Carstensen		200,000		134,890		18,516		334,890		200,000		1,079,119		148,125		1,279,119
Alan Rassaby		157,500		99,006		13,047		256,506		157,500		792,044		104,375		949,544


(1)		Represents the value of “in the money”, accelerated options that vest upon termination other than for cause as of January 1, 2010 as if exercised at $17.37, which was the closing price of our stock on that date.

(2)		Represents the value of “in the money”, accelerated options that vest upon termination other than for cause as of January 1, 2010 as if exercised at $17.37, which was closing price of our stock on that date. The percentage of options subject to acceleration is described above in Termination Without Cause or For Good Reason Following Change in Control for all officers.

We believe that the payment of compensation and the acceleration of unvested options in these circumstances is a common practice in comparable companies, and is justifiable from both a recruitment and retention perspective. We also believe that the amount of severance is within the range typically seen in comparable companies, and that we would experience difficulties attracting and retaining executives in the absence of severance arrangements that are at least as attractive as those that we offer.

Principal Elements of Director Compensation

Compensation of Directors

We have a policy to reimburse directors for reasonable expenses incurred in connection with their attendance at board and committee meetings, but we currently do not provide our directors with cash compensation for their services as members of our board of directors or any committee of our board of directors. Under our 2004 Equity Incentive Plan, before March 3, 2010, non-employee directors were automatically granted stock options to purchase 30,000 shares of our common stock upon appointment to our board of directors, vesting in equal quarterly installments over three years. At each annual stockholders’ meeting, each non-employee director who had not received an initial grant as described above during the same

calendar year automatically received an immediately vested option grant to purchase 15,000 shares of common stock, and each of our committee chairs who had not received an initial grant as described above during the same calendar year automatically received an additional immediately vested option grant to purchase 5,000 shares of common stock. In addition, before March 3, 2010, our lead independent director automatically received an immediately vested option grant to purchase 1,000 shares of common stock at each annual stockholders’ meeting. Each of these options that was automatically granted had an exercise price per share equal to the closing price of our common stock on the grant date as quoted by the Nasdaq Global Market, and had a maximum term of ten years. The compensation committee reviews the remuneration of directors annually. In 2009, the compensation committee retained a compensation consultant, Towers Perrin, to provide comparative information regarding cash and non-cash remuneration provided to directors of other public companies. Towers Perrin reviewed the compensation practices for directors at 38 publicly-traded peer companies as mentioned above in the section titled “General Compensation Philosophy for Executive Officers.” Towers Perrin advised the compensation committee that based on the closing price of our common stock at the end of 2009, and in the absence of any additional compensation, our directors would be compensated in 2009 below the 25th percentile when compared to our peer group. Having regard to our historical practice of non-cash remuneration of our directors, the compensation committee decided on February 10, 2009, not to make cash payments to directors, but decided instead in the interests of fairness and competitiveness that an additional discretionary stock option grant should be made to each independent director for 2009, such grant to be made immediately and to vest 25% per quarter over a one-year period, with full acceleration in the event of a change in control, and a ten year term from the date of grant. Accordingly, Messrs. Allen, Avis, Kendra, Lansing and Snyder were granted options to purchase an additional 15,000 shares of our common stock in connection with their roles as board members. In addition, Messrs. Allen, Lansing and Snyder were granted options to purchase an additional 5,000 shares of our common stock in connection with their roles as committee chairs. Mr. Lansing also was granted an option to purchase 1,000 shares of our common stock in connection with his role as lead director. The stock option grants occurred February 10, 2009, and have an exercise price of $8.38 per share, which was the fair market value of our common stock on the date of grant.

Each of Messrs. Allen, Avis, Kendra, Lansing and Snyder were automatically granted options to purchase 15,000 shares of our common stock at our annual stockholders’ meeting in June 2009. In addition, Messrs. Allen, Lansing and Snyder were automatically granted options to purchase an additional 5,000 shares of our common stock at our annual stockholders’ meeting in June 2009 in connection with their roles as committee chairs. Mr. Lansing also was automatically granted an option to purchase 1,000 shares of our common stock at our annual stockholders’ meeting in June 2009 in connection with his role as lead independent director. These options have a ten year term, are fully vested and immediately exercisable at the date of grant and have an exercise price of $9.07 per share. Mr. Singh was automatically granted an option to purchase 30,000 shares of our common stock upon his appointment to our board of directors in October 2009. This option has a ten year term, vests and becomes exercisable in twelve installments of 2,500 shares every three months from the date of grant and has an exercise price of $14.77 per share.

On March 3, 2010, our board of directors, on the recommendation of our compensation committee, amended our 2004 Equity Incentive Plan to eliminate the automatic grant program for directors. The compensation committee concluded that a grant program that automatically provides for a fixed number of options to be awarded to directors was too inflexible and unresponsive to market conditions. For 2010, the compensation committee recommended that a periodic market review take place of the total direct compensation payable to directors in peer companies, and that director compensation should be determined in light of that review. For 2010, our compensation committee determined that directors should be granted a mixture of stock options and restricted stock units according to a formula that rewards leadership of, and participation in, our board and its various committees.

Director Compensation


									Change in
									Pension Value
							Non-Equity		and
	Fees						Incentive		Nonqualified
	Earned or		Stock		Option		Plan		Deferred		All Other
	Paid in		Awards		Awards		Compensation		Compensation		Compensation
Name(1)	Cash ($)		($)		($)(2)(3)		($)		Earnings		($)		Total ($)

Richard E. Allen	$	—	$	—	$	169,250	$	—	$	—	$	—	$	169,250
Gregory M. Avis(4)		—		—		126,938		—		—		—		126,938
Thomas W. Kendra		—		—		126,938		—		—		—		126,938
William J. Lansing		—		—		177,713		—		—		—		177,713
Allen E. Snyder		—		—		169,250		—		—		—		169,250
S. Steven Singh		—		—		225,876		—		—		—		225,876


(1)		Greg R. Gianforte, the chairman of our board of directors, has been omitted from this table because he receives no additional compensation for serving on our board.

(2)		Excludes the effect of forfeiture assumptions. The fair value of option awards shown are calculated in accordance with Topic 718, Compensation-Stock Compensation and represent the aggregate grant date fair value of option awards granted during the year. See Note 1(q) and Note 10, Stock-Based Compensation, in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K filed March 9, 2010 for the relevant assumptions used to determine the valuation of our option awards.

(3)		Aggregate option awards outstanding and exercisable that have been granted to each of our non-employee directors named above, as of December 31, 2009, the last day of our most recent fiscal year, are as follows: Mr. Allen — 145,000 shares; Mr. Avis — 71,250 shares; Mr. Kendra — 68,750 shares; Mr. Lansing — 137,750 shares; Mr. Snyder — 47,500 shares; and Mr. Singh — 0 shares.

(4)		This option was granted to Mr. Avis as a part of director compensation. Mr. Avis is a member of Summit Master Company, LLC, which is the general partner of Summit Partners, L.P. Mr. Avis is deemed to hold the option for the benefit of Summit Partners, which determines when the option is to be exercised and is entitled to the shares issued upon exercise. Accordingly, Summit Partners and Summit Master Company may be deemed indirect beneficial owners of the option. Mr. Avis, Summit Partners, L.P. and Summit Master Company each disclaim beneficial ownership of the option except to the extent of its pecuniary interest therein.

Impact of Accounting and Tax Treatment of Compensation

Section 162(m) of the Internal Revenue Code disallows a tax deduction to publicly held companies for compensation paid to certain of their executive officers to the extent that such compensation exceeds $1.0 million per covered officer in any fiscal year. The limitation applies only to compensation that is not considered to be performance-based. Non-performance-based compensation paid to our executive officers during 2009 did not exceed the $1.0 million limit per officer, and we do not expect the non-performance-based compensation to be paid to our executive officers during 2010 to exceed that limit. Because it is unlikely that the cash compensation payable to any of our executive officers in the foreseeable future will approach the $1.0 million limit, we do not expect to take any action to limit or restructure the elements of cash compensation payable to our executive officers so as to qualify that compensation as performance-based compensation under Section 162(m). We will reconsider this decision should the individual cash compensation of any executive officer ever approach the $1.0 million level.

Compensation Committee Interlocks and Insider Participation

During 2009, the compensation committee of our board of directors consisted of Messrs. Allen, Lansing and Snyder. None of the compensation committee members has at any time been one of our officers or employees or an officer or employee of any of our subsidiaries. None of our executive officers has ever served

as a member of the board of directors or compensation committee of any other entity that has or has had one or more executive officers serving as a member of our board of directors or compensation committee.

Compensation Committee Report

The compensation committee of the board of directors has reviewed and discussed RightNow’s compensation discussion and analysis with management. Based on this review and discussion, the compensation committee recommended to the board of directors that the compensation discussion and analysis be included in RightNow’s definitive proxy statement on Schedule 14A for its 2010 annual meeting of stockholders, and be incorporated by reference in RightNow’s annual report on Form 10-K for the year ended December 31, 2009, each as filed with the Securities and Exchange Commission.

The foregoing report was submitted by the compensation committee of the board of directors and shall not be deemed soliciting material or filed with the Commission or subject to Regulation 14A promulgated by the Commission or Section 18 of the Securities Exchange Act of 1934.

Respectfully submitted,

Allen E. Snyder, Chair

Richard E. Allen

William J. Lansing

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table provides information concerning beneficial ownership of our common stock as of March 31, 2010 by: (a) each stockholder, or group of affiliated stockholders, that we know owns more than 5% of our outstanding common stock; (b) each of our named executive officers; (c) each of our directors; and (d) all of our directors and executive officers as a group.

The following table lists the number of shares and percentage of shares beneficially owned based on 31,985,858 shares of common stock outstanding as of March 31, 2010. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission, and generally includes voting power and/or investment power with respect to the securities held. Shares of common stock subject to options currently exercisable or exercisable within 60 days of March 31, 2010 are deemed outstanding and beneficially owned by the person holding such options for purposes of computing the number of shares and percentage beneficially owned by such person, but are not deemed outstanding for purposes of computing the percentage beneficially owned by any other person. Except as indicated in the footnotes to this table, and subject to applicable community property laws, the persons or entities named have sole voting and investment power with respect to all shares of our common stock shown as beneficially owned by them.

Unless otherwise indicated, the principal address of each of the stockholders below is c/o RightNow Technologies, Inc., 136 Enterprise Boulevard, Bozeman, Montana 59718.


	Shares Beneficially
	Owned
Name and Address of Beneficial Owner	Number		Percent

Greg R. Gianforte(1)(2)		4,409,580		13.8	%
Susan Gianforte(2)		4,378,330		13.7	%
Richard E. Allen(3)		160,000		0.5	%
Gregory M. Avis(4)		90,000		0.3	%
Marcus A. Bragg(5)		67,457		0.2	%
Joseph Brown(6)		75,954		0.2	%
Susan J. Carstensen(7)		396,076		1.2	%
Steven D. Daines(8)		80,992		0.3	%
Jeffrey C. Davison(9)		119,872		0.4	%
Thomas W. Kendra(10)		78,500		0.2	%
William J. Lansing(11)		373,333		1.2	%
Jason Mittelstaedt(12)		152,083		0.5	%
Michael A. Myer(13)		517,138		1.6	%
Alan A. Rassaby(14)		188,997		0.6	%
S. Steven Singh(15)		5,000		0.0	%
Allen E. Snyder(16)		62,750		0.2	%
All directors and executive officers as a group(15 persons)(17)		6,777,732		21.2	%
Gianforte Family Charitable Trust(18)		3,562,050		11.1	%
T. Rowe Price Associates, Inc.(19)		3,128,936		9.8	%
FMR LLC(20)		2,159,452		6.8	%
TAMRO Capital Partners LLC(21)		1,740,878		5.4	%


(1)		Includes 31,250 shares underlying options exercisable as of or within 60 days of March 31, 2010.

(2)		Includes 2,411,874 shares held by Greg and Susan Gianforte, co-trustees of the Greg Gianforte Revocable Trust dated May 23, 2005 and Greg and Susan Gianforte, co-trustees of the Susan Gianforte Revocable Trust dated May 23, 2005, Tenants in Common. Includes 513,311 shares held by the Second East Gallatin River Trust of Greg R. Gianforte, an irrevocable grantor retained annuity trust. Includes 439,566 shares held by the Gianforte Charitable Remainder Unitrust #1 and 1,013,579 shares held by the Gianforte


		Charitable Remainder Unitrust #2. Does not include 3,562,050 shares of common stock held by the Gianforte Family Charitable Trust, a tax-exempt private foundation. Mr. and Mrs. Gianforte and Richard Gianforte are trustees of such tax exempt private foundation, but disclaim beneficial ownership of the common stock registered in the name of such tax exempt private foundation.

(3)		Includes 150,000 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 10,000 shares held directly by Richard E. Allen. Mr. Allen’s principal address is 7135 Polo Ridge Drive, Littleton, CO 80128.

(4)		Includes 75,000 shares underlying options exercisable as of or within 60 days of March 31, 2010. The options were granted to Mr. Avis as a part of director compensation. Mr. Avis is a member of Summit Master Company, LLC, which is the general partner of Summit Partners, L.P. Mr. Avis is deemed to hold the option for the benefit of Summit Partners, which determines when the option is to be exercised and is entitled to the shares issued upon exercise. Accordingly, Summit Partners and Summit Master Company may be deemed indirect beneficial owners of the option. Mr. Avis, Summit Partners, L.P. and Summit Master Company each disclaim beneficial ownership of the option except to the extent of its pecuniary interest therein. Includes 15,000 shares held directly by Gregory M. Avis. The principal address of Gregory M. Avis is 499 Hamilton Avenue, Palo Alto, CA 94301 and the principal address for Summit Partners and Summit Master Company is 222 Berkeley Street #18, Boston, MA 02116.

(5)		Includes 67,457 shares underlying options exercisable as of or within 60 days of March 31, 2010.

(6)		Includes 75,954 shares underlying options exercisable as of or within 60 days of March 31, 2010.

(7)		Includes 330,416 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 65,660 shares held directly by Susan J. Carstensen and her spouse.

(8)		Includes 71,250 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 9,742 shares held directly by Steven D. Daines and his spouse.

(9)		Includes 102,503 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 17,369 shares held directly by Jeffrey C. Davison.


(10)		Includes 75,000 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 3,500 shares held directly by Thomas W. Kendra. Mr. Kendra’s principal address is 101 Kennedy Court, Los Gatos, CA 95032.

(11)		Includes 143,000 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 230,333 shares held directly by William J. Lansing and his spouse. The principal address of William J. Lansing is 601 108th Avenue NE, Suite 1200, Bellevue, WA 98004.

(12)		Includes 152,083 shares underlying options exercisable as of or within 60 days of March 31, 2010.

(13)		Includes 327,500 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 189,638 shares held directly by Michael A. Myer.

(14)		Includes 188,997 shares underlying options exercisable as of or within 60 days of March 31, 2010.

(15)		Includes 5,000 shares underlying options exercisable as of or within 60 days of March 31, 2010. The principal address of S. Steven Singh is 18400 NE Union Hill Road, Redmond, WA 98052.

(16)		Includes 57,500 shares underlying options exercisable as of or within 60 days of March 31, 2010 and 5,250 shares held directly by Allen E. Snyder. Mr. Snyder’s principal address is P.O. Box 1499, Monument, CO 80132.

(17)		Includes the information set forth in notes 1 through 16 above.

(18)		Mr. and Mrs. Gianforte and Richard Gianforte are trustees of the Gianforte Family Charitable Trust, a tax exempt private foundation, but disclaim beneficial ownership of the common stock registered in the name of such tax exempt private foundation. The principal address of the Gianforte Family Charitable Trust is 1320 Manley Road, Bozeman, MT 59715.

(19)		Based on a Schedule 13G/A filed with the Securities and Exchange Commission on February 12, 2010 and other information provided by T. Rowe Price Associates, Inc., the securities are owned by various individual and institutional investors for which T. Rowe Price Associates, Inc. (“Price Associates”) serves as investment adviser with power to direct investments and/or sole power to vote the securities. For


		purposes of the reporting requirements of the Securities Exchange Act of 1934, Price Associates is deemed to be a beneficial owner of such securities; however, Price Associates expressly disclaims that it is, in fact, the beneficial owner of such securities. T. Rowe Price Associates, Inc. is an investment advisor with a principal address of 100 E. Pratt Street, Baltimore, MD 21202.

(20)		Based solely on a Schedule 13G filed with the Securities and Exchange Commission on February 16, 2010. According to the Schedule 13G, Fidelity Management & Research Company (“Fidelity”), 82 Devonshire Street, Boston, MA 02109, a wholly-owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940, is the beneficial owner of 2,150,952 shares. Pyramis Global Advisors Trust Company (“PGATC”), 900 Salem Street, Smithfield, RI 02917, an indirect wholly-owned subsidiary of FMR LLC and a bank as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, is the beneficial owner of 8,500 shares. Edward C. Johnson 3d and FMR LLC, through its control of Fidelity and PGATC, each has sole power to dispose of the 2,159,452 shares. Neither FMR LLC nor Edward C. Johnson 3d has the sole power to vote or direct the voting of such shares owned directly by the Fidelity funds, which power resides with the Fidelity funds’ Boards of Trustees and owned by the institutional accounts managed by PGATC, respectively. FMR LLC is a financial services company with a principal address of 82 Devonshire Street, Boston, MA 02109.

(21)		Based solely on a Schedule 13G/A filed with the Securities and Exchange Commission on February 9, 2010. According to the Schedule 13G/A, TAMRO Capital Partners LLC (“TAMRO”) has sole power to vote or direct the vote with respect to 1,296,588 shares and has shared power to dispose or to direct the disposition of 1,740,878 shares. For purposes of the reporting requirements of the Securities Exchange Act of 1934, TAMRO is deemed to be a beneficial owner of such securities. TAMRO is an investment advisor with a principal address of 1660 Duke Street, Suite 200 Alexandria, VA 22314.

Securities Authorized for Issuance Under Equity Compensation Plans

The following table gives certain information as of December 31, 2009 about our equity compensation plans.

Number of Shares

Number of Shares to be

Weighted-Average

Remaining Available for

Issued Upon Exercise

Exercise Price of

Issuance Under Equity

of Outstanding

Outstanding

Compensation Plans

Options, Warrants

(Excluding Shares in

Plan Category

and Rights

Column (a))

(a)

(b)

(c)

Equity compensation plans approved by shareholders(1)

5,971,671

(2)

10.96

3,399,483

(3)

Equity compensation plans not approved by shareholders

—

Total

5,971,671

10.96

3,399,483


(1)		Consists of the 2004 Equity Incentive Plan, as amended, the 2004 Employee Stock Purchase Plan and the 1998 Long-Term Incentive and Stock Option Plan. No additional option grants are being made under the 1998 Long-Term Incentive and Stock Option Plan after August 5, 2004.

(2)		Excludes purchase rights currently accruing under the 2004 Employee Stock Purchase Plan which was approved by shareholders and had a total reserve of 850,400 shares as of December 31, 2009. Under the Purchase Plan, each eligible employee may purchase up to 5,000 shares of our common stock (through payroll deductions in an amount not to exceed 15% of their compensation for each pay period during a purchase period) on the last business day of June and December each year at a purchase price per share established by the administrator prior to the first business day of each purchase period. In no event, however, will the purchase price for any purchase period be less than the lesser of 85% of the fair market value of our common stock on the first business day and the last business day of that purchase period. For the purchase period ending June 30, 2010 the administrator has set the maximum permitted payroll


		deduction at 10% of salary and established a purchase price equal to 95% of the fair market value on June 30, 2010.

(3)		Consists of shares available for future issuance under the 2004 Employee Stock Purchase Plan and the 2004 Equity Incentive Plan, as amended. As of December 31, 2009, an aggregate of 624,987 shares of common stock were available for issuance under the 2004 Employee Stock Purchase Plan and an aggregate of 2,774,496 shares of common stock were available for issuance under the 2004 Equity Incentive Plan. The number of shares of common stock reserved under our 2004 Employee Stock Purchase Plan automatically increases on the first day of each year in an amount equal to the lesser of (a) 500,000 shares or (b) 2% of the number of shares of our common stock outstanding on the last day of the preceding year or (c) such lesser number as determined by our board of directors. The number of shares of common stock reserved under our 2004 Equity Incentive Plan will automatically be increased on the first day of each year, in an amount equal to the lesser of (a) 1,000,000 shares or (b) 4% of the number of shares of our common stock outstanding on the last day of the preceding year or (c) such lesser amount as determined by our board of directors. On January 1, 2010, the additional reserve for the 2004 Equity Incentive Plan was automatically increased by 1,000,000 shares, and the reserve for the 2004 Employee Stock Purchase Plan was automatically increased by 100 shares as determined by the board on December 2, 2009. Since the effective date of the 2004 Employee Stock Purchase Plan, 225,413 shares of common stock have been purchased thereunder. During the current purchase period up to 58,000 shares of common stock are available for purchase under the 2004 Employee Stock Purchase Plan.

Certain Relationships and Related Party Transactions

Since January 1, 2009, there has not been, nor has there been proposed, any transaction, arrangement or relationship or series of similar transactions, arrangements or relationships, including those involving indebtedness not in the ordinary course of business, to which we or our subsidiaries were or are a party, or in which we or our subsidiaries were or are a participant, in which the amount involved exceeded or exceeds $120,000 and in which any of our directors, nominees for director, executive officers, beneficial owners of more than 5% of any class of our voting securities or any member of the immediate family of any of the foregoing persons, had or will have a direct or indirect material interest, other than as described above under the heading “Compensation Discussion and Analysis” and other than the transactions described below. Each of the transactions described below was reviewed and approved or ratified by our Audit Committee.

Office Leases with Genesis Partners, LLC. We lease from Genesis Partners, LLC 29,724 square feet of office space at 40 Enterprise Boulevard, Bozeman, Montana; 12,912 square feet of office space at 110 Enterprise Boulevard, Bozeman, Montana; 9,184 square feet of office space at 77 Discovery Drive, Bozeman, Montana; and 29,148 square feet of additional office space for our principal executive offices space at 136 Enterprise Boulevard, Bozeman, Montana. Greg Gianforte, our Chairman, Chief Executive Officer and President, and Steve Daines, our Vice President and General Manager Asia Pacific, beneficially own, directly or indirectly, 50% and 25% membership interests in Genesis Partners, respectively. The remaining 25% of Genesis Partners is beneficially owned by Mr. Daines’ father, Clair Daines, who is a commercial real estate developer and builder. The 40 Enterprise Boulevard lease has a 120-month term that started April 1, 2001, with an option to extend for one additional 120-month period. We renewed the lease at 110 Enterprise Boulevard for a start date of June 13, 2010 for a term of 60 months, with an option to extend an additional 60-month term. The 136 Enterprise Boulevard lease has a 120-month term that started February 22, 2007, with two options to extend each for an additional 60-month period, and the right to terminate after 84 months of occupancy with 24 months prior written notice of termination. The 77 Discovery Drive lease has a 60-month term that started April 1, 2010, with an option to extend for an additional 60-month term. Our current rent is $40,426 per month for the 40 Enterprise Boulevard lease; $11,785 per month for the 77 Discovery Drive lease; $16,568 per month for the 110 Enterprise Boulevard lease; and $36,487 for the 136 Enterprise Boulevard lease, including insurance, taxes and common area maintenance, but excluding utilities. We believe that the terms of these leases are no less favorable to us than they would have been if obtained from unaffiliated third parties.

Indemnification Agreements. We have entered into indemnification agreements with each of our current directors and executive officers. These agreements require us to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to us and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. We also intend to enter into indemnification agreements with our future directors and executive officers.

Policies and Procedures for Related Person Transactions. Under Item 404 of SEC Regulation S-K, a related person transaction is any actual or proposed transaction, arrangement or relationship or series of similar transactions, arrangements or relationships, including those involving indebtedness not in the ordinary course of business, since the beginning of our last fiscal year, to which we or our subsidiaries were or are a party, or in which we or our subsidiaries were or are a participant, in which the amount involved exceeded or exceeds $120,000 and in which any of our directors, nominees for director, executive officers, beneficial owners of more than 5% of any class of our voting securities or any member of the immediate family of any of the foregoing persons, had or will have a direct or indirect material interest.

Pursuant to its written charter, our Audit Committee is responsible for reviewing and approving, prior to our entry into any such transaction, all related person transactions and potential conflict of interest situations involving any of our directors, nominees for director, executive officers, beneficial owners of more than 5% of any class of our voting securities or any member of the immediate family of any of the foregoing persons. In addition, our Code of Ethics and Business Conduct requires that our officers and employees use good judgment to adhere to high ethical standards with respect to situations that create an actual or potential conflict between such person’s personal interests and the interests of RightNow.

Our Audit Committee also has adopted written policies and procedures for related person transactions that require the Audit Committee to review any proposed transaction with related persons to determine if it rises to the level of a related person transaction covered by Item 404 of Regulation S-K and, if it does, then such related person transaction must be approved or ratified by the disinterested members of the Audit Committee. Our management must disclose to the Audit Committee all material information regarding actual and proposed related person transactions known to them that involve our directors, nominees for director, executive officers, beneficial owners of more than 5% of any class of our voting securities and any member of the immediate family of any of the foregoing persons. A related person will not be deemed to have a material interest in a transaction if the interest arises only: (a) from the person’s position as a director of another corporation or organization that is a party to the transaction; or (b) from the direct or indirect ownership by such person and all other related persons, in the aggregate, of less than a ten percent equity interest in another person or entity (other than a partnership) which is a party to the transaction; or (c) from a combination of both (a) and (b); or (d) from the person’s position as a limited partner in a partnership in which the person and all other related persons, have an interest of less than ten percent, and the person is not a general partner of and does not hold another position in the partnership. Additionally, our general counsel reviews our sales pipeline every three months to identify customer prospects that are associated with any of our directors, nominees for director, executive officers, beneficial owners of more than 5% of any class of our voting securities and any member of the immediate family of any of the foregoing persons, which must thereafter be approved by our Audit Committee prior to accepting any such orders if it would constitute a related person transaction.

Our Audit Committee has determined that the following categories of transactions shall be deemed preapproved by the Audit Committee, notwithstanding the fact that they are related person transactions:


	•	compensation to executive officers determined by our Compensation Committee;

	•	compensation to directors determined by our Compensation Committee or our Board of Directors; and

	•	transactions in which all security holders receive proportional benefits.

ANNUAL REPORT

We filed with the Securities and Exchange Commission an Annual Report on Form 10-K on March 9, 2010. A copy of the Annual Report on Form 10-K has been mailed concurrently with this proxy statement to all record holders of our stock entitled to notice of and to vote at the Annual Meeting, and is also posted on our web site at http://investor.rightnow.com/annual-proxy.cfm. No separate annual report to the stockholders was prepared by us. The Annual Report on Form 10-K is not incorporated into this proxy statement and is not considered proxy solicitation material. Our Annual Report on Form 10-K, as well as certain other reports, proxy statements and other information regarding us, are available on the Securities and Exchange Commission’s web site at http://www.sec.gov. In addition, we will provide without charge a copy of our Annual Report on Form 10-K to any stockholder upon written request addressed to our corporate secretary at RightNow Technologies, Inc., 136 Enterprise Boulevard, Bozeman, Montana 59718, and will furnish upon request any exhibits to the Form 10-K upon the payment by the requesting stockholder of our reasonable expenses in furnishing such exhibits.

By Order of the Board of Directors

of RightNow Technologies, Inc.

Alan A. Rassaby

Secretary

Dated April 27, 2010



		VOTE BY INTERNET - www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.


TO VOTE, MARK BLOCKSBELOW IN BLUE OR BLACK INK AS FOLLOWS:
				KEEP THIS PORTION FOR YOUR RECORDS
				DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

For
All

Withhold
All

For All
Except

To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below.

The Board of Directors recommends that you vote
FOR the following:


1.	Election of Directors
	Nominees

01	Greg R. Gianforte	02 Gregory M. Avis	03 Thomas W. Kendra

The Board of Directors recommends you vote FOR the following proposal(s):


		For	Against	Abstain
2	To ratify the appointment of KPMG LLP as the company’s independent registered public accounting firm for 2010.	o	o	o

3	In accordance with the discretion of the proxy holders, to act upon all matters incident to the conduct of the meeting and upon other matters as may properly come before the meeting, or any adjournment or postponement thereof.	o	o	o

Signature [PLEASE SIGN WITHIN BOX]

Date

Signature (Joint Owners)

Date

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement, 10K Wrap is/are available at www.proxyvote.com.

PROXY

RIGHTNOW TECHNOLOGIES, INC.

Annual Meeting of Stockholders, June 7, 2010 12:00 PM

This proxy is solicited on behalf of the Board of Directors

The undersigned revokes all previous proxies, acknowledges receipt of the Notice of the Annual Meeting of
Stockholders to be held Monday, June 7, 2010 and the Proxy Statement and appoints Alan A. Rassaby and
Jeffrey C. Davison, and each of them, the Proxy of the undersigned, with full power of substitution, to vote all
shares of Common Stock of RIGHTNOW TECHNOLOGIES, INC. (the “Company”) which the undersigned is
entitled to vote, either on his or her own behalf or on behalf of any entity or entities, at the 2010 Annual Meeting
of Stockholders of the Company to be held at the Hilton Garden Inn, 2023 Commerce Way, Bozeman, Montana
59715, on Monday, June 7, 2010 at 12:00 p.m. Mountain Daylight Savings Time (the “Annual Meeting”), and at
any adjournment or postponement thereof, with the same force and effect as the undersigned might or could do
if personally present thereat. The shares represented by this Proxy shall be voted in the manner set forth on this
proxy card.

This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of

Directors’ recommendations.

Continued and to be signed on reverse side


NOTICE OF ANNUAL MEETING OF STOCKHOLDERS			i
PROXY STATEMENT			1
General			1
Voting; Quorum			1
Effect of Not Casting Your Vote			2
Proxies			2
Solicitation			2
Deadline for Receipt of Stockholder Proposals			2
Note with Respect to Forward-Looking Statements			3
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING			4
PROPOSAL ONE: ELECTION OF DIRECTORS			4
General			4
Directors and Nominees			4
Nominees for Terms Ending Upon the 2013 Annual Meeting of Stockholders			4
Continuing Directors for Term Ending Upon the 2011 Annual Meeting of Stockholders			5
Continuing Directors for Term Ending Upon the 2012 Annual Meeting of Stockholders			6
Corporate Governance, Board Composition and Board Committees			6
Independent Directors			6
Lead Independent Director			7
Board Structure and Committees			7
Audit Committee			7
Compensation Committee			8
Nomination and Governance Committee			8
Annual Self-Evaluations			9
Director Resignation Policy			9
Succession Plan			9
Director Education			10
Board and Committee Meetings			10
Stockholder Communications			10
Code of Ethics and Business Conduct			10
Required Vote			10
Recommendation of Our Board of Directors			10
PROPOSAL TWO: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			11
Principal Accountant Fees and Services			11
Determination of Independence			11
Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors			11
Vote Sought			12
Recommendation of Our Board of Directors			12
OTHER MATTERS			13
AUDIT COMMITTEE REPORT			14
Executive Officers			15
Executive Compensation			17


Compensation Discussion and Analysis			17
Introduction			17
Role of Compensation Committee			17
General Compensation Philosophy for Executive Officers			17
Compensation Components and Process			18
Principal Elements of Executive Compensation			21
Base Salary			21
Discretionary Bonus			21
Annual Cash Incentive Plan			21
Long-Term Equity-Based Incentive Awards			23
Perquisites			27
Post-Employment Compensation			27
Employment Contracts, Termination of Employment and Change-In-Control Agreements			27
Principal Elements of Director Compensation			28
Compensation of Directors			28
Impact of Accounting and Tax Treatment of Compensation			30
Compensation Committee Interlocks and Insider Participation			30
Compensation Committee Report			31
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			32
Securities Authorized for Issuance Under Equity Compensation Plans			34
Certain Relationships and Related Party Transactions			35
Office Leases with Genesis Partners, LLC			35
Indemnification Agreements			36
Policies and Procedures for Related Person Transactions			36
Section 16(a) Beneficial Ownership Reporting Compliance			37
ANNUAL REPORT			38