Pottery Barn 2014 Annual Report Download - page 112

our 2000 Nonqualified Stock Option Plan that expired unexercised after March 15, 2006. If this proposal is
approved, then a total of 32,309,903 shares will have been authorized for grant under the amended and restated
Incentive Plan since its inception. As of March 30, 2015, before the addition of shares pursuant to this proposal,
3,411,226 reserved shares were subject to outstanding awards and 4,379,565 reserved shares remained available
for future grant. The 1993 Stock Option Plan and the 2000 Nonqualified Stock Option Plan are no longer used to
grant awards. On March 30, 2015, the closing price of a share of our common stock on the New York Stock
Exchange was $79.11.
To the extent permitted by stock exchange regulations, awards granted or shares issued by the company in
assumption of, or in substitution or exchange for, prior awards or obligations of any company acquired by or
combined with the company or a subsidiary shall not be added to or reduce the maximum limit on shares
reserved for issuance under the Incentive Plan. In the event that a company acquired by or combined with the
company or a subsidiary has shares available under a pre-existing plan approved by stockholders that was not
adopted in contemplation of the acquisition or combination, to the extent permitted by stock exchange
regulations, the shares available for grant under that pre-existing plan (as adjusted to reflect the acquisition or
combination) may be used for awards under the Incentive Plan, and shall not reduce or be added back to the
number of authorized shares under the Incentive Plan. However, awards using such shares that are available
under any such pre-existing plan (1) shall not be made after the date awards or grants could have been made
under the terms of the pre-existing plan, absent the acquisition or combination, and (2) shall only be made to
individuals who were not eligible for awards under the Incentive Plan prior to the acquisition or combination.
Board Approval of the Amended and Restated Incentive Plan
On March 25, 2015, our Board approved the amended and restated Incentive Plan, subject to approval from our
stockholders at the 2015 Annual Meeting. Our named executive officers and directors have an interest in this
proposal because they are eligible to receive plan awards.
Summary of the Amended and Restated Incentive Plan
The following provides a summary of the principal features of the amended and restated Incentive Plan and its
operation. This summary is qualified in its entirety by the Amended and Restated 2001 Long-Term Incentive
Plan attached as Exhibit A.
Types of Awards are Available under the Incentive Plan
We may grant the following types of incentive awards under the Incentive Plan: (i) stock options; (ii) restricted
stock; (iii) restricted stock units; (iv) stock appreciation rights that are settled in shares; (v) dividend equivalents;
and (vi) deferred stock awards.
Plan Administration
A committee of at least two non-employee members of our Board administers the Incentive Plan (the
“committee”). To the extent the company wishes to qualify grants as exempt from the short-swing transaction
liability provisions of Section 16 of the Securities Exchange Act, as amended (relating to purchases and sales of
our stock within less than six months), the members of the committee must qualify as “non-employee directors.”
Further, to make grants to our officers or directors, the members of the committee must qualify as “independent
directors” under the applicable requirements and criteria of the New York Stock Exchange. Members of the
committee must also qualify as “outside directors” under Section 162(m) to the extent the company wishes to
potentially receive a federal tax deduction for certain compensation paid under the plan to our Chief Executive
Officer and the next three highest paid employees (other than our principal financial officer). The committee has
delegated its authority under the plan to two members of the Board, but only with respect to grants to certain of
our employees who are not “officers” for purposes of Section 16.
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