Staples 2007 Annual Report Download - page 52

salary of $400,000. The supplemental long term disability plan extends such coverage generally for an
additional $200,000 of base salary. All of the named executive officers, other than Mr. Doody, have elected
supplemental long term disability coverage.
•Survivor Benefit Plan. If a named executive officer dies while actively employed by Staples, his or her
beneficiary will receive 100% replacement income (base salary and bonus) for the first year and an additional
50% for each of the following two years.
•Executive Physical and Registry Program. This is a company paid physical examination program to enhance
awareness and treatment of potential health risks faced by the named executive officers. In addition, this
program supports named executive officers and their family members with health resources in the United
States or while traveling abroad.
Executive Perquisites
Our executive compensation program is relatively free of perquisites, consistent with our egalitarian culture and
entrepreneurial spirit. To reinforce this position, the Compensation Committee adopted formal policies in 2004
regarding personal use of our leased aircraft and reimbursement for tax planning services for senior officers. The
Compensation Committee views our limited executive perquisites as reasonable and competitive.
Under our aircraft policy, our Chief Executive Officer is permitted to use our leased aircraft for personal use so
long as the incremental cost to Staples is treated as compensation income to our Chief Executive Officer. Subject to
prior approval of our Chief Executive Officer and similar compensation treatment, other named executive officers
may also use our leased aircraft for personal use. There was no personal use of our leased aircraft during our 2007
fiscal year.
We reimburse each named executive officer, other than our Chief Executive Officer, up to $5,000 each year for
tax, estate or financial planning services or advice from a pre-approved list of service providers that must not include
our outside auditors. Our Chief Executive Officer is reimbursed up to $50,000 each year for these services. All such
reimbursements are grossed up to reflect any tax a recipient must pay on the reimbursement. The Compensation
Committee annually reviews the amounts paid under this policy for compliance.
The Compensation Committee’s Processes
The Compensation Committee has established a number of processes to help ensure that our executive
compensation program meets the objectives described at the beginning of this Compensation Discussion and Analysis.
Independent Compensation Consultant
Our Compensation Committee charter authorizes the Compensation Committee to engage independent legal
and other advisors and consultants as it deems necessary or appropriate to carry out its responsibilities. Accordingly,
in our 2007 fiscal year, the Compensation Committee retained, pursuant to a written agreement, Exequity LLP as an
independent advisor reporting to the Compensation Committee to advise on and assist with executive compensation
matters. From 2002 through 2006, the Compensation Committee had engaged Hewitt Associates LLC. In early 2007,
the principal consultant to the Compensation Committee since 2002 joined Exequity, and after careful consideration
of several factors, including quality of advice, independence issues, knowledge of Staples’ practices, and cost, the
Compensation Committee decided to maintain its relationship with its principal consultant and switch service
providers to Exequity. Under the terms of Exequity’s agreement, Exequity is responsible for, among other matters:
• Reviewing total compensation strategy and pay levels for executives;
• Performing competitive analyses of outside board member compensation;
• Examining all aspects of executive compensation programs to ensure that they support the business strategy;
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