Vistaprint 2012 Annual Report Download - page 128

Compensation Components for Executives
The principal elements of our compensation program for our executive officers are the following:
‰Base salary
‰Annual cash incentive awards, which reward executives based on Vistaprint’s achievement of shorter term
financial performance goals for the current fiscal year
‰Long-term incentive awards, which may include long-term cash incentives, share options, and restricted
share units, which reward executives based on Vistaprint’s achievement of longer term financial
objectives and the creation of value for our shareholders as reflected in our share price
‰Standard health and welfare benefits that are applicable to all of our employees in each executive’s geo-
graphic location
‰Expatriate benefits for our executives who are assigned to work in geographic locations outside of their
home countries
In addition, we have severance and change in control arrangements with our executives.
Under our pay-for-performance philosophy, the compensation of our employees at higher levels in the orga-
nization is generally more heavily weighted towards variable compensation based on our performance, and base
salary generally accounts for a smaller portion of these employees’ total compensation packages. Conversely,
employees at lower levels in the organization generally receive more of their compensation in the form of base
salary and less in the form of variable compensation. In accordance with this philosophy, the Compensation
Committee generally seeks to allocate the compensation of our executive officers as follows:
‰Base salary of Mr. Keane, our Chief Executive Officer, at the 25th percentile of our primary peer group
‰Base salaries of our other executive officers at the 35th percentile of our primary peer group
‰Annual cash compensation (base salary and annual cash incentive) of all executive officers including
Mr. Keane at the 50th percentile of our primary peer group
‰Total compensation (base salary, annual cash incentive, and long-term incentive awards) of all executive
officers including Mr. Keane at the 75th percentile of our primary peer group
Base Salary
The Compensation Committee determined the fiscal 2012 base salaries of our named executive officers as
follows:
‰Mr. Keane’s base salary had not increased during the previous two fiscal years (and in fact decreased from
fiscal 2010 to fiscal 2011), during which time Vistaprint’s business grew significantly, resulting in the
inclusion of larger comparable companies in our primary compensation peer group for fiscal 2012.
Accordingly, the Compensation Committee determined that Mr. Keane’s base salary was significantly
below the 25th percentile of our primary peer group and increased his base salary for fiscal 2012 by
approximately 50% to bring it up to the 25th percentile.
‰The base salaries that our other executive officers received in fiscal 2012 increased modestly from fiscal
2011, by 2–5%, to maintain their salaries at the 35th percentile of our primary peer group.
You can find more information on our named executive officers’ salaries in the Summary Compensation
Table below.
Annual Cash Incentive Awards
The Compensation Committee grants annual cash incentive awards to our executive officers to provide an
incentive to executives to achieve financial goals that are tied to the current fiscal year. For fiscal 2012, the
Compensation Committee based the annual cash incentives 50% on Vistaprint’s achievement of full-year con-
stant currency revenue goals and 50% on Vistaprint’s achievement of full-year earnings per share, or EPS, goals
determined by the Compensation Committee based on our annual budget approved by the Supervisory Board.
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