Big Lots 2011 Annual Report Download - page 52

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performance amounts were established for fiscal 2011, and the Committee did not believe that the accrual items
should have the effect of increasing the corporate performance amount for fiscal 2011 bonuses. The Committee’s
decision to exercise negative discretion was not based on corporate or individual performance factors.
The following table reflects the payout percentage for each bonus level and the corporate performance amount
required to achieve the corresponding bonus level, with the results for fiscal 2011, calculated as described above
(including the Committee’s discretionary reduction discussed in the preceding paragraph), noted:
Bonus Level
and
2011 Results
Payout Percentage
(% of salary) Corporate Performance
Amount
($)Mr. Fishman Mr. Cooper Ms. Bachmann Mr. Haubiel Mr. Martin
No Bonus 0.0 0.0 0.0 0.0 0.0 0-375,210,999
Floor 60.0 30.0 30.0 30.0 30.0 375,211,000
Target 120.0 60.0 60.0 60.0 60.0 391,212,000
Stretch 240.0 120.0 120.0 120.0 120.0 402,012,000
2011 Results 0 0 0 0 0 364,271,946
Our named executive officers did not earn a bonus for fiscal 2011 under our 2006 Bonus Plan, because our fiscal
2011 performance was lower than the corporate performance amount established for the floor bonus level. The
primary objectives in setting the corporate performance amounts for fiscal 2011 was to reward 2006 Bonus Plan
participants while encouraging strong corporate earnings growth. As a consequence of not making fiscal 2011
bonus payments, total cash compensation paid to our named executive officers for fiscal 2011 was generally
at or below the median for our peer groups. We believe lower than market average total cash compensation is
appropriate in light of our fiscal 2011 performance and furthers our objectives to motivate our executives and
reward superior performance.
Equity for Fiscal 2011
All equity awards granted to our named executive officers in fiscal 2011 were made under the 2005 LTIP and are
reflected in the Grants of Plan-Based Awards in Fiscal 2011 table. The equity compensation awarded to our named
executive officers for fiscal 2011 consisted of restricted stock awards and, with the exception of Mr. Fishman,
non-qualified stock options. The Committee believes that granting a significant quantity of restricted stock and
stock options to our named executive officers further aligns their interests with the interests of our shareholders
and provides us with a significant retention and motivation tool. Accordingly, our named executive officers’
equity interests in our organization, through restricted stock and stock options, comprise a substantial portion of
their compensation. The Committee is not tied to any particular process or formula to determine the size of the
equity awards granted to our named executive officers. The Committee instead uses its discretion to grant equity
awards and may consider the various factors discussed below. The Committee undertook the following process to
determine the size of the equity awards for our named executive officers for fiscal 2011:
• The Committee reviewed an estimate prepared by management of the number of common shares to be
granted during fiscal 2011 to all recipients other than our CEO. As it related to the EMC members other
than our CEO, this estimate was based on historical grant information, anticipated future events, and
our CEO’s evaluation of individual performance and recommendations.
• In executive session, the Committee evaluated and approved our CEO’s recommendations for equity
awards for the other EMC members and determined the equity award for our CEO. In each case, the
Committee made these determinations based on historical grant information and the Committee’s
subjective views of comparative compensation data, retention factors, corporate performance
(particularly operating profit, income from continuing operations, selling and administrative expenses
and earnings per share against planned and prior performance), individual performance, the executive’s
level of responsibility, the potential impact that the executive could have on our operations and financial
condition, and the market price of our common shares. See the introduction to the “Our Executive
Compensation Program for Fiscal 2011” section and the “Performance Evaluation” section of this
CD&A for a discussion of how our CEO and the Committee evaluate performance.