Vistaprint 2010 Annual Report Download - page 127

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• Link the amount of variable compensation and an individual’s ability to influence performance
outcomes.
• Align executive and long-term shareholder interests by structuring compensation programs to reward
long-term shareholder value creation and mitigate the focus on short-term share price and other near-
term metrics.
• Evaluate and refine all compensation programs in light of our strategic direction and life-cycle stage,
the practices of peers and the overall affordability of compensation packages.
Compensation Committee Approach
Each year, the Compensation Committee conducts a review of our executive compensation program,
which includes a review and detailed competitive analysis performed by an independent compensation
consultant. The Compensation Committee engaged the firm DolmatConnell & Partners as its compensation
consultant in fiscal year 2010 and manages the relationship with the firm. DolmatConnell provides competitive
compensation analysis and recommendations to the Compensation Committee with respect to the compensation
of our named executive officers and also provides competitive analysis and recommendations to our
Compensation Committee and Chief Executive Officer with respect to the compensation of members of our
senior management team who are not executive officers. DolmatConnell does not provide any services to
Vistaprint other than compensation consulting services.
Under the Compensation Committee’s direction, DolmatConnell analyzed base salary, target total cash
compensation, actual total cash compensation, long-term incentive compensation, target total direct compensa-
tion and actual total direct compensation of our named executive officers as compared to two peer groups of
companies. DolmatConnell developed, with Compensation Committee oversight, a “primary” comparison peer
group consisting of publicly traded firms that have characteristics that are currently comparable to Vistaprint
or comparable to where Vistaprint expects to be in the near future: Annual revenue in the range of $600 million
to $1.7 billion, in Vistaprint’s industry, and market capitalization between $1.6 billion and $4.2 billion. For
fiscal 2010, the primary peer group consisted of 3Com, Akamai Technologies, Allscripts-Misys Healthcare
Solutions, Cadence Design Systems, Compuware, Equinix, F5 Networks, IAC/InterActive, Monster Worldwide,
Nuance Communications, Open Text, Parametric Technology, Quest Software, Rackspace Hosting, Sohu.com,
Solera Holdings, Sybase, TANDBERG, TIBCO Software and VeriSign. In addition to publicly available
compensation data about the primary peer group companies, DolmatConnell also uses published compensation
surveys as an additional frame of reference to validate the primary peer group data.
DolmatConnell also developed a second “aspirational” comparison peer group assuming annual revenues,
industry, and market capitalizations comparable to Vistaprint in the future if Vistaprint were to achieve its
current business objectives. The Compensation Committee uses this aspirational peer group to help it forecast
future compensation trends that may be applicable to us if we experience growth rates that are in line with our
expectations.
In addition, DolmatConnell conducted a detailed equity utilization analysis for the Compensation
Committee. This analysis compares the number of shares that Vistaprint grants per year pursuant to equity
compensation awards and the number of shares subject to outstanding equity compensation awards and
available for grant under our equity compensation plans with both our primary and aspirational peer group, to
assist the Compensation Committee in gauging how Vistaprint’s practices of granting equity to its employees
compares to our peer companies.
Based on its analysis of the compensation data of our primary and aspirational peer group companies and
on Vistaprint’s compensation philosophy described above, DolmatConnell made recommendations to the
Compensation Committee with respect to the compensation of our named executive officers. In determining
the compensation of our executive officers for fiscal 2010, the Compensation Committee considered the
competitive analysis and recommendations of DolmatConnell, as well as detailed tally sheets summarizing our
officers’ current and historical compensation.
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