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EXECUTIVE COMPENSATION AND COMPENSATION DISCUSSION AND ANALYSIS
www.staplesannualmeeting.com STAPLES 45
Performance Metric Percentile vs. Peer Group – 2014
Total Shareholder Return 41st
Revenue Growth 1st
EPS Growth 1st
Return on Invested Capital 21st
Conclusions
The Committee reviewed the compensation levels of our
NEOs in November 2015 and determined that overall
compensation was appropriate in view of the Company’s
relative and absolute performance. The Committee’s
determination reflected its assessment of the three-year
realized TDC for the CEO and 2014 compensation for the
other NEOs, all of which were significantly below median.
The Committee concluded that, on balance, and with respect
to our CEO, our three-year performance and corresponding
compensation for the period were aligned. The one-year target
total compensation for all the other NEOs was well below the
median of the peer group.
IV OTHER MATTERS
Termination Scenarios
The Committee regularly reviews all compensation
components for our NEOs, including salary, bonus, current
vested and unvested long term incentive compensation, the
current value of owned shares, and cost of all perquisites and
benefits. In addition, the Committee periodically examines
similar information for other senior executives. The Committee
also reviews the projected payout obligations under potential
retirement, termination, severance, and change-in-control
scenarios to fully understand the financial impact of each of
these scenarios to Staples and to the executives.
Documentation detailing the above components and
scenarios with their respective dollar amounts was prepared
by management for each of our NEOs and reviewed by the
Committee in March 2016. This information was prepared
based on compensation data as of the end of fiscal year
2015 and assumed that the various scenarios occurred at
the end of fiscal year 2015. Similar termination scenario
information with respect to our 2015 fiscal year is presented
under the heading “Potential Payments upon Termination or
Change-in-Control.” Based on this review, the Committee
found the total compensation for each of our NEOs under
these various scenarios to be reasonable. Many factors were
considered, including, but not limited to, the contributions of
the executive to Staples, the financial performance of Staples,
the marketplace, the particular contemplated scenario and
input provided by the independent compensation consultant.
Input from Management
Certain officers within our Human Resources department
regularly attend Committee meetings to provide information
and recommendations regarding our executive compensation
program, including the Executive Vice President of Human
Resources and Vice President of Compensation and Benefits.
Among other things, these officers present our CEO’s
recommendations regarding any change in the base salary,
bonus, equity compensation, goals related to performance-
based cash or equity compensation and other benefits of
other senior executives. These officers also compile other
relevant data at the request of the Committee. The CEO’s
recommendations are based in part on the results of annual
performance reviews of the other executives. The Committee
is not bound by such recommendations but generally takes
them into consideration before making final determinations
about the compensation of such executives other than our
CEO. The CEO, at the discretion of the Committee, may
be invited to attend all or part of any Committee meeting
to discuss compensation matters pertaining to the other
executives, and in fiscal 2015, he attended all four Committee
meetings. When discussing compensation matters pertaining
to our CEO, the Committee generally meets in executive
sessions with its independent compensation consultant
without any member of management present. In 2015,
management engaged its own compensation consultant,
Willis Towers Watson, separately from the Committee’s
compensation consultant, to help develop the CEO’s
recommendations to the Committee. In November 2015, the
Committee performed a conflict of interest assessment with
respect to Willis Towers Watson and no conflict of interest
was identified.