Staples 2014 Annual Report Download - page 49

EXECUTIVE COMPENSATION AND COMPENSATION DISCUSSION AND ANALYSIS
www.staplesannualmeeting.com STAPLES 45
Legacy Long-Term Cash Award – In March 2013, the
Committee granted a one-time 2013-2014 performance-
based long-term cash award to certain officers of the
company, including the NEOs (other than Mr. Wilson). The one
time award was in recognition of the belief that the three-year
cumulative RONA goal under the outstanding 2012-2014
long term cash award was highly unlikely to be achieved as
it no longer represented the company’s priorities due to the
strategic reinvention plan. The 2013-2014 long term cash
award was contingent on achieving Sales Growth % and
RONA% goals that were more reflective of the current strategy.
One half of the target award was the target amount for each
of the two fiscal years within the performance cycle and goals
were established annually. In March 2015, at the end of the
two-year period, the Committee certified the results based
on performance in each of the two fiscal years, and cash
awards were paid in accordance with goal achievement. The
approved performance metrics, weightings and goals for the
2013-2014 award were the same as the goals (RONA% and
Sales Growth %) approved for the 2013-2015 performance
shares. The chart below shows the goals results for both
2013 and 2014 and the resulting payments that equated to
a 68.5% payout under the plan. Going forward into 2015, the
only long-term incentive vehicle for executive officers are the
performance shares.
Named Executive Officer
2 Year Performance Period
Achievement
(2013 - 2014)
Target
Award
Actual
Payout
2013
(RONA% and
Sales Growth%)
2014
(RONA% and
Sales Growth%)
Ronald L. Sargent 49.7% 87.3% $2,193,333 $1,502,433
Christine T. Komola 49.7% 87.3% $161,133 $110,376
Joseph G. Doody 49.7% 87.3% $578,467 $396,250
Demos Parneros 49.7% 87.3% $578,467 $396,250
Executive Benefits & Perquisites
Retirement & Other Benefits
We do not have a pension plan in which our NEOs participate.
However, our NEOs are eligible to participate in defined
contribution retirement income plans. These plans include a
standard 401(k) qualified plan and a Supplemental Executive
Retirement Plan (“SERP”). Both plans are fully funded by the
NEOs and supported by Staples through limited matching
contributions. Our NEOs are eligible to participate in our
401(k) qualified plan on the same basis as our other salaried
associates; however, their contributions are limited to 2% of
eligible compensation. Due to the limitations on our officers’
ability to contribute to our 401(k) plan, we maintain the SERP,
which is a non-qualified deferred compensation plan intended
to provide comparable benefits above the applicable limits of
our 401(k) qualified plan. Under the SERP, officers of Staples
may defer a total of up to 100% of their base salary, bonus,
and long term cash incentive awards and receive matching
contributions up to a maximum of 4% of base salary and bonus.
Additionally, the NEOs are eligible to participate in standard
health and welfare programs on the same basis as our
other salaried associates. These programs include medical,
dental, vision, disability, and supplemental life insurance. We
also have an Executive Benefits Program consisting of life
insurance, long term care insurance, supplemental long term
disability, a survivor benefit plan, and an executive physical and
registry program. This program was implemented to enhance
our retirement and benefit offerings for senior management
consistent with competitive practices and to further support
our efforts to attract and retain top talent. All senior officers
of Staples, including the NEOs, are eligible to participate in
this program. For each plan or policy described above that
requires payment of periodic premiums or other contributions,
we generally pay such premiums or other contributions for the
benefit of each NEO. For more information about retirement
and other benefits, see the “All Other Compensation”
table following the “Summary Compensation Table” in this
proxy statement.
Expatriate Benefits
For more information about expatriate benefits, see the “All Other Compensation” table following the “Summary Compensation
Table” in this proxy statement. Mr. Wilson received certain ex-pat benefits in connection with his assignment to the Netherlands in
his role as President Staples Europe.
Executive Perquisites
Our executive compensation program is relatively free of
perquisites. The Committee has adopted a policy prohibiting
gross up payments to cover taxes triggered by a change in
control in any future compensation, severance, or employment-
related agreement.
Aircraft Policy. Under our aircraft policy, our CEO is permitted
to use our leased aircraft for personal use so long as the
incremental cost to Staples is treated as compensation
income to our CEO. Subject to prior approval by our CEO and
similar compensation treatment, other NEOs may also use our
leased aircraft for personal use. There was no personal use of
our leased aircraft during our 2014 fiscal year.