Pottery Barn 2006 Annual Report Download - page 109

Grants of Plan-Based Awards during Fiscal 2006
This table sets forth certain information regarding all grants of plan-based awards made to the named executive
officers during fiscal 2006.
Grant
Date
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards
Estimated Future Payouts
Under Equity Incentive Plan
Awards
All
Other
Stock
Awards;
Number
of Shares
of Stock
or Units
(#)
All Other
Option
Awards;
Number of
Securities
Underlying
Options
(#)(3)
Grant Date
Fair
Value(4)
Exercise
or Base
Price of
Option
Awards
($/Sh)
Threshold
($)(1) Target($)(1)
Maximum
($)(2)
Threshold
($)
Target
($)
Maximum
($)
W. Howard Lester . . . 1/12/2007 — — $2,925,000 — — — — 400,000 $4,709,000 $34.64
Edward A. Mueller . . . — — — $2,925,000 — — — — — — —
Sharon L. McCollam . . 9/12/2006 — — $1,560,000 — — — — 40,000 $ 319,590 $30.34
Laura J. Alber ...... 9/12/2006 — — $1,800,000 — — — — 40,000 $ 319,590 $30.34
Patrick J. Connolly . . . 3/15/2006 — — $1,650,000 — — — — 50,000 $ 560,987 $40.44
David M. DeMattei . . . 9/12/2006 — — $1,650,000 — — — — 40,000 $ 319,590 $30.34
(1) This reflects the amounts payable under our 2001 Incentive Bonus Plan with respect to fiscal year 2006. This plan is
intended to qualify bonus payments as deductible performance-based compensation under Internal Revenue Code
Section 162(m), which otherwise restricts our ability to deduct certain executive compensation to $1 million per
executive per year. In accordance with Internal Revenue Service rules, our 2001 Incentive Bonus Plan payout criteria are
specified by our Compensation Committee in the first quarter of each fiscal year. Bonus amounts are not paid until the
Compensation Committee certifies that the performance objectives have been achieved. For fiscal year 2006, the
performance criteria was based upon achieving a target level of profitability. This target level, because it is based upon
profitability, is deemed substantially uncertain for purposes of Internal Revenue Code Section 162(m). When the goal
was established by our Compensation Committee, however, it was reasonably attainable based upon our historic and
expected levels of profitability. Once the target level of profitability is reached, the maximum amount payable is then
available for payment to our executive officers as fully deductible compensation. However, our Compensation
Committee is permitted to apply negative discretion in determining the actual amount to be paid to any executive officer.
In determining how (or if) to apply such negative discretion, our Compensation Committee measures company
performance against the business plan approved by the Board in our first fiscal quarter as well as individual performance.
(2) Maximum potential payment pursuant to our 2001 Incentive Bonus Plan is equal to three times the executive’s base
salary as of January 30, 2006. No payments related to fiscal 2006 were made to named executive officers pursuant to the
2001 Incentive Bonus Plan.
(3) Grants of stock-settled stock appreciation rights.
(4) Generally, the full grant date fair value is the amount that the company would expect to expense on the grant date in its
financial statements over the award’s vesting schedule. Assumptions used in the calculations of these amounts are
included in Note I to our Consolidated Financial Statements which is included in our Annual Report on Form 10-K for
the fiscal year ended January 28, 2007.
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