Vistaprint 2011 Annual Report Download - page 120

Proxy Statement
Fiscal 2011 was an unusual year in that four of the six individuals listed in the Summary Compensation
Table below, to whom we refer as our named executive officers, were promoted during the fiscal year
(Ms. Blake, Ms. Cebula and Messrs. Ruotolo and Teunissen), and one of our named executive officers,
Mr. Giannetto, resigned as an executive officer in March 2011 and remained as a Vistaprint employee in a
non-executive capacity until June 30, 2011. The total cash and equity compensation of our Chief Executive
Officer, Mr. Keane, whose role did not change during fiscal 2011, was within the 75th to 80th percentiles of
our primary peer group, in line with the philosophy described above. Similarly, when determining the
compensation levels of the four executive officers who received promotions, the Compensation Committee
increased their base salaries and annual cash incentives to be in line with the base salaries and annual bonuses
that our peer companies paid for similar roles. However, each newly promoted executive officer also received
special equity compensation grants in connection with his or her promotion that resulted in total compensation
for fiscal 2011 that was above market in comparison with our peer companies. The purposes of the special
equity compensation grants were to recognize and reward each executive for his or her work that led to the
promotion and to retain each executive and align his or her interests with those of our shareholders over the
long term, through a four-year vesting schedule for each award.
Compensation Components for Executives
The principal elements of our executive compensation program for executive officers are base salary,
annual cash incentive awards, long-term cash incentive awards, share options and restricted share units. The
annual cash incentive component of the executive compensation program emphasizes Vistaprint’s achievement
of financial objectives in the then-current fiscal year, while the long-term cash incentive awards, share options
and restricted share units, to which we refer collectively as our long-term incentive program, focus on both
Vistaprint’s achievement of longer term financial objectives and the creation of value for our shareholders as
reflected in our share price. Executive officers also participate in the standard health and welfare benefits
applicable to our employees in their geographic home locations.
In accordance with our compensation philosophy, the Compensation Committee has established a
pay-for-performance model for our executive officers, with the total compensation package for fiscal year
2011 weighted heavily toward compensation based on Vistaprint’s operating and stock performance. For fiscal
2011, our named executive officers had more than 80% of their total compensation at risk through our annual
and long-term cash and equity incentive programs. Our annual and long-term cash incentive programs are
dependent on Vistaprint’s revenue and earnings per share performance, while our equity incentive programs
are dependent on the performance of our share price. Attainment of the annual and long-term cash incentives
are based on financial goals that the Compensation Committee believes are highly challenging, but achievable.
The equity incentive program is designed to incent our executives to create long-term shareholder value.
Annual Compensation
Base Salary
We use base salary to recognize the experience, skills, knowledge and responsibilities of all employees,
including our executive officers. Under our pay-for-performance philosophy, the compensation of our employ-
ees at higher levels in the organization is generally more heavily weighted towards variable compensation
based on our performance, and base salary generally accounts for a smaller portion of these employees’ total
compensation packages. Conversely, employees at lower levels in the organization generally receive more of
their compensation in the form of base salary and less in the form of variable compensation.
The Compensation Committee established base salary compensation levels for executive officers based on
external market data and our overall compensation philosophy. To establish base salaries for fiscal year 2011,
the Committee reviewed Towers Watson’s recommendations with respect to the salary compensation of officers
with comparable qualifications, experience and responsibilities at companies in the primary peer group. In
addition to external market data, the Committee also considered the executive’s role in the organization,
experience within the role, individual performance and internal equity in determining individual base salary
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