Vistaprint 2012 Annual Report Download - page 130

Share Options and Restricted Share Units for Executives
The Compensation Committee believes that granting equity awards is an effective way to motivate our
executives to manage the company in a manner that is consistent with the long-term interests of both the com-
pany and our shareholders, with equity awards generating returns for our executives and employees as our share
price increases. Our share options and restricted share units also provide us with an important retention tool, as
the equity grants vest over a multiple-year period only if the executive continues to be employed by us on each
vest date.
In fiscal 2012, we granted restricted share units to all of our executive officers other than Robert Keane. The
restricted share units vest over four years, and each unit that vests is automatically converted into an ordinary
share of Vistaprint on a one-to-one basis.
In fiscal 2012 as part of the redesign of our long-term executive compensation program described in the Execu-
tive Overview section of this CD&A, our Compensation Committee decided to grant to our executive officers multi-
year, premium-priced share option awards designed to increase the emphasis on Vistaprint’s long-term performance
and our new five-year growth strategy using share price as the primary performance metric. The value of these
premium-priced options represents the total approximate value of all long-term incentive awards that Mr. Keane
would have received over a four-year period and the total approximate value of all traditional share options that our
other executive officers would have received over a four-year period. Accordingly, our Supervisory Board has
passed resolutions that, until fiscal 2016 at the earliest, we will not grant any additional long-term incentive award
in any form to Mr. Keane or any additional share options to our other current executive officers. We do, however,
anticipate granting long-term incentive awards, other than options, to executive officers other than Mr. Keane. You
can find more information about the premium-priced options in the Executive Overview section of this Compensa-
tion Discussion and Analysis.
In general, we grant equity awards to our executive officers annually at the regularly scheduled meeting of
the Compensation Committee held in the fourth quarter of each fiscal year. Accordingly, grants made in fiscal
2012 were approved at the May 2012 Compensation Committee meeting. We typically grant equity awards to
employees who are not executive officers during our first fiscal quarter after the conclusion of our annual per-
formance review cycle.
Long-Term Cash Incentive Compensation
For fiscal 2012, the Compensation Committee granted long-term cash incentive awards to our executive
officers. These long-term cash incentive awards reflect our pay-for-performance culture and philosophy and are
intended to enhance our ability to manage the number of shares available under our equity compensation plans
and to balance the focus on share price appreciation created through equity awards with cash awards based on the
achievement of financial metrics that drive long-term company and shareholder value creation.
Each long-term cash incentive award has a performance cycle of four fiscal years, and each executive officer is
eligible to receive 25% of his or her total award for each fiscal year in the performance cycle. At the beginning of
each four-year performance cycle, the Compensation Committee develops performance goals for each fiscal year
within that specific cycle. We granted long-term cash incentive awards to our named executive officers in fiscal
years 2010, 2011, and 2012 with performance goals based on Vistaprint’s achievement of EPS targets expressed as
dollar values in the low, medium and upper ranges. The Compensation Committee uses the same definition of EPS
for purposes of the long-term cash incentive awards as it does for the annual cash incentive awards described above,
and in connection with Vistaprint’s acquisition of Webs, Inc. in December 2011, the Committee made the same
amendment to the long-term cash incentive awards that it made to the fiscal 2012 annual cash incentive awards to
revise 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.
We measure performance on an annual basis and make payments for each fiscal year in the performance cycle
based on the level of goal achievement for that fiscal year. Actual payout levels can range from 0% to 250% of tar-
get award depending on the year.
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