Pottery Barn 2011 Annual Report Download - page 166

applied to either the Company as a whole or, except with respect to stockholder return metrics, to a region,
business unit, affiliate or business segment, and measured either on an absolute basis, a per-share basis or relative
to a pre-established target, to a previous period’s results or to a designated comparison group, and, with respect
to financial metrics, which may be determined in accordance with United States Generally Accepted Accounting
Principles (“GAAP”), in accordance with accounting standards established by the International Accounting
Standards Board (“IASB Standards”) or which may be adjusted when established to exclude any items otherwise
includable under GAAP or under IASB Standards: (i) revenue (on an absolute basis or adjusted for currency
effects); (ii) cash flow (including operating cash flow or free cash flow); (iii) cash position; (iv) earnings (which
may include earnings before interest and taxes, earnings before taxes, net earnings or earnings before interest,
taxes, depreciation and amortization); (v) earnings per share; (vi) gross margin; (vii) net income; (viii) operating
expenses or operating expenses as a percentage of revenue; (ix) operating income or net operating income;
(x) return on assets or net assets; (xi) return on equity; (xii) return on sales; (xiii) total stockholder return;
(xiv) stock price; (xv) growth in stockholder value relative to the moving average of the S&P 500 Index, or
another index; (xvi) return on capital; (xvii) return on investment; (xviii) economic value added; (xix) operating
margin; (xx) market share; (xxi) overhead or other expense reduction; (xxii) credit rating; (xxiii) objective
customer indicators; (xxiv) improvements in productivity; (xxv) attainment of objective operating goals;
(xxvi) objective employee metrics; (xxvii) return ratios; (xxviii) profit; (xxix) objective qualitative milestones; or
(xxx) other objective financial or other metrics relating to the progress of the Company or to a Subsidiary,
division or department thereof. The performance goals may differ from participant to participant, within or
between award periods and from award to award.
5.2 Award Limits. The maximum award under this Plan for each award period to any participant shall
not exceed $10,000,000. Each performance goal established under this Plan shall be established by the
Committee not later than the earlier of the date which is 90 days after the first day of the performance award
period, or the date on which 25% of the award period has elapsed.
5.3 Determination of Amount of Individual Awards. For each award period, each participant who is
or may be a Covered Employee for such award period shall receive an award equal to the specific amount
(subject to decrease as provided in this Section 5.3) determined strictly under the performance goals established
pursuant to Section 5.1. The Committee shall not have the discretion to increase, but shall have the discretion to
decrease, any award determined in accordance with this Plan. The reduction in any participant’s award for any
award period as a result of the Committee’s exercise of such discretion shall not increase the amount of an award
to any other participant (through reallocation of unutilized awards or otherwise) with respect to such award
period.
6. Award Periods; Payment of Awards.
6.1 Award Periods. All awards shall be made on the basis of an award period, which shall consist of
one or more fiscal years of the Company, or one or more quarters thereof. The award period may be different for
different awards.
6.2 Committee Certifications. As a condition precedent to the payment of any award, the Committee
shall certify, following the end of the award period, that the objective performance goal for the award has been
satisfied. The Committee shall make such determination by means of a written resolution or certification of the
Committee that is maintained in the minute book of the Company.
6.3 Payment of Awards. Awards under this Plan will be paid in cash, reasonably promptly following
the conclusion of the award period and the certification of the Committee as set forth in Section 6.2, but in no
event later than two and one-half (2
1
⁄ 2 ) months after the conclusion of the fiscal year of the Company in which
or with which the award period ends. All awards under this Plan will be subject to withholding for applicable
employment and income taxes.
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