Vistaprint 2013 Annual Report Download - page 110

unless our shareholders reapprove it. We have updated the Performance Incentive Plan to include some addi-
tional performance criteria and exceptions to the criteria, as described below. We are asking you to reapprove the
plan, as updated, at the meeting because we believe the plan has been successful in helping us promote the long-
term interests of Vistaprint and its shareholders by providing additional incentives for participants to contribute
to improving our operating results and by rewarding outstanding performance on the part of those individuals
whose decisions and actions most significantly affect our long-term growth, profitability, and efficient operation.
The Performance Incentive Plan seeks to align the interests of participants with the interests of our share-
holders by providing for the payment of bonuses based on specific performance criteria that are designed to
increase long-term shareholder value. We are asking for your reapproval of the Performance Incentive Plan,
including the performance criteria described in the Performance Incentive Plan, because shareholder approval
will allow Vistaprint to take a U.S. income tax deduction under Section 162(m) of the United States Internal
Revenue Code of 1986, or the Code, for amounts paid under the plan to our covered employees. In addition,
granting awards under the Performance Incentive Plan has allowed us to reduce the amount of equity compensa-
tion that we would otherwise grant to participants in this plan.
The Performance Incentive Plan authorizes our Compensation Committee to grant cash incentive awards to
“covered employees” within the meaning of Section 162(m) of the Code, which term includes our Chief Execu-
tive Officer and our three other highest compensated executive officers. Although our Chief Financial Officer is
not considered a “covered employee” under the Code, the Performance Incentive Plan also authorizes the Com-
pensation Committee to grant cash incentive awards to the Chief Financial Officer and any other key employees
that the Compensation Committee may designate from time to time. In the past, the Compensation Committee
has issued awards to eligible participants under the plan providing for cash bonuses based either on annual per-
formance over a one-year period or on performance over a multiple-year period.
The Supervisory Board believes that the Performance Incentive Plan is in the best interest of Vistaprint and
its shareholders and recommends that shareholders vote for the proposal to reapprove the Performance Incentive
Plan.
Tax Issues
Section 162(m) of the Code limits the deductibility of compensation paid to “covered employees” to
$1 million per year. However, the deduction limit does not apply to amounts that satisfy specific rules to be
treated as “qualified-performance-based” compensation and are paid under a “performance-based plan” in com-
pliance with specific rules under Section 162(m) of the Code. In general, compensation constitutes qualified-
performance-based compensation made from a performance-based plan only if it satisfies each of the following
four requirements:
‰the compensation is payable on the attainment of one or more pre-established, objective performance cri-
teria;
‰the performance criteria are established by a committee composed solely of two or more outside directors;
‰the material terms of the compensation and performance criteria are disclosed to and approved by share-
holders before payment; and
‰the committee that established the performance criteria certifies that the performance criteria have been
satisfied before payment.
We are requesting shareholder approval in order to meet the third requirement listed above.
Summary of the Performance Incentive Plan
The following summary of the Performance Incentive Plan is qualified in its entirety by the text of the Per-
formance Incentive Plan, which is available on our website www.vistaprint.com or by contacting us at
Vistaprint N.V., c/o Vistaprint USA, Incorporated, Attention: Investor Relations, 95 Hayden Avenue, Lexington,
MA 02421, USA.
Proxy Statement
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