Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(e) On February 13, 2013, the Compensation Committee (the "Committee") of the Board of Directors (the "Board") of Shutterfly, Inc., a Delaware corporation (the "Company") approved changes to the compensation of the Company's named executive officers.

For Jeffrey Housenbold, President and Chief Executive Officer, effective March 1, 2013, the Committee increased his annual base salary from $530,000 to $560,000 (an increase of 5.7%). His 2013 annual performance-based bonus compensation target remains at 100% of his annual base salary. On February 13, 2013, the Committee awarded Mr. Housenbold a discretionary cash bonus of $250,000, bringing his full year 2012 bonus to $907,200.00.

For Brian Regan, Senior Vice President and Chief Financial Officer, who joined Shutterfly in August of 2012, effective March 1, 2013, Mr. Regan's base salary remains at $400,000. Mr. Regan's 2013 annual performance-based bonus target was increased from 30% to 40% of his annual base salary. On February 13, 2013, the Committee awarded Mr. Regan a discretionary cash bonus of $15,000, bringing his full year 2012 bonus to $75,000.

For Dwayne Black, Senior Vice President, Operations, effective March 1, 2013, the Committee increased his annual base salary from $265,000 to $295,000 (an increase of 11.3%). Mr. Black's 2013 annual performance-based bonus target was increased from 30% to 40% of his annual base salary. On February 13, 2013, the Committee awarded Mr. Black a discretionary cash bonus of $60,000, bringing his full year 2012 bonus to $158,630.

For Dan McCormick, Senior Vice President and General Manager, effective March 1, 2013, the Committee increased his annual base salary from $306,000 to $366,000 (an increase of 19.6%). Mr. McCormick's 2013 annual performance-based bonus target was increased from 30% to 40% of his annual base salary. On February 13, 2013, the Committee awarded Mr. McCormick a discretionary cash bonus of $85,000, bringing his full year 2012 bonus to $198,850.

For each named executive officer, the actual amount of their 2013 annual performance bonus may exceed the target annual bonus depending on the Committee's assessment of the named executive officer's achievement of a combination of corporate and personal objectives. The corporate objectives for 2013, which have been reviewed by the Committee and approved by the independent members of the Committee, include specific goals related to the Company's performance and financial objectives.

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