Vistaprint 2012 Annual Report Download - page 129

The Compensation Committee believes these goals are highly challenging but achievable. For purposes of calcu-
lating these annual incentives, the Compensation Committee defines “constant currency revenue” as consolidated
net revenue for Vistaprint and its subsidiaries for the fiscal year, adjusted to use the same currency exchange
rates as set forth in Vistaprint’s budget for the fiscal year. “Earnings per share” is defined as earnings per share
on a diluted basis for the results of Vistaprint’s operations on a consolidated basis for the fiscal year, calculated
in accordance with U.S. generally accepted accounting principles with some exclusions for income or expenses
relating to certain specific events that the Committee believes would introduce inaccurate reflections of
management-driven performance. In connection with Vistaprint’s acquisition of Webs, Inc. in December 2011,
the Committee amended the fiscal 2012 annual cash incentive awards by revising the EPS calculation to exclude
certain charges and expenses relating to the acquisition and integration of Webs which resulted in an adjusted
EPS that was $0.10 higher than Vistaprint’s U.S. GAAP EPS for fiscal 2012.
As set forth in the fiscal 2012 annual award agreements with our executive officers, the calculation of the
actual amount to be paid for the annual cash incentives was as follows:
‰The annual incentive payout was a percentage of the fiscal 2012 target award for each executive, listed in
the table below, where the payout percentage equals (0.5 X Revenue Target Percentage^0.5 + 0.5 X EPS
Target Percentage^0.5)^19.2. The Revenue Target Percentage and EPS Target Percentage were calculated by
dividing the actual amounts for the fiscal year by the goals determined by the Compensation Committee.
‰If either Vistaprint’s actual constant currency revenue or actual EPS for fiscal 2012 were less than 90% of
the goal, then the total annual cash incentive payout would be zero even if the other goal were achieved.
‰The fiscal 2012 payout percentage was capped at a maximum of 250%.
Fiscal 2012 Annual Cash Incentives
For fiscal 2012, Vistaprint achieved constant currency revenue of $1.041 billion and adjusted EPS of $1.23,
as compared to our constant currency revenue goal of $1.029 billion and EPS goal of $1.17 to $1.23 (calculated
using $1.20 as the target). Although this level of achievement would have yielded a payout percentage of 119.8%
of the executives’ targets in accordance with the formula set forth above, the Compensation Committee believed
that the executives had not earned an above-target payout for fiscal 2012 because the 101.1% achievement of the
revenue goal included revenue from businesses we had acquired during the fiscal year and without that additional
revenue, Vistaprint would not have achieved the revenue goal. Accordingly, the Compensation Committee used
its right of negative discretion to reduce the payout percentage to 100% of the executives’ target levels.
The following table sets forth the target and actual annual cash incentives for our named executive officers
for fiscal 2012:
Name
Target Annual
Incentive
($)
Actual Annual
Incentive Paid
($)
Robert S. Keane ............................................ €603,000 €603,000
Katryn Blake ............................................... $270,000 $270,000
Donald R. Nelson ........................................... $180,000 $180,000
Nicholas Ruotolo ............................................ $270,000 $270,000
Ernst J. Teunissen ........................................... €210,000 €210,000
Long-Term Incentive Program
Our long-term incentive program is designed to focus our executives and employees on long-term perform-
ance and value creation for the company and our shareholders. The Compensation Committee, with recom-
mendations from our independent compensation consultant, determines the mix among our three long-term
incentive vehicles — which may include share options, restricted share units, and long-term cash incentives —
for our executives and employees.
Proxy Statement
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