Big Lots 2009 Annual Report Download - page 46

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For fiscal 2009, the Committee believes it has taken the necessary actions to preserve the deductibility of all
payments made under our executive compensation program, with the exception of a portion of the compensation
paid to Mr. Fishman. If the IRC or the related regulations change, the Committee intends to take reasonable steps
to ensure the continued availability of deductions for payments under our executive compensation program, while
at the same time considering our executive compensation philosophy and objectives and the competitive market for
executive talent.
Our Executive Compensation Program for Fiscal 2010
At its meeting in March 2010, the Committee: (i) certified that a bonus was payable for fiscal 2009 under the 2006
Bonus Plan; (ii) reviewed the tally sheets and compensation history for all EMC members; (iii) reviewed internal
pay equity information and comparative compensation data from our retailer-only and broader peer groups; (iv)
reviewed the at-risk incentive compensation as a percentage of the total executive compensation awarded for fiscal
2009 for each named executive officer; and (v) formulated its recommendations to the other outside directors for
fiscal 2010 executive compensation (including the financial measure, corporate performance amounts and payout
percentages for bonuses, the amount of common shares underlying stock option and restricted stock awards, and
the first and second triggers for restricted stock awards). The Committee also reviewed drafts of this CD&A
and the other compensation disclosures required by the SEC. At the subsequent Board meeting, the Committee
recommended, and the outside directors approved, the following fiscal 2010 salaries, payout percentages for the
target bonus level (with floor being one-half of the target payout percentage and stretch being double the target
payout percentage) and equity awards for the named executive officers:
Name
Fiscal 2010
Salary
($)
Fiscal 2010
Target Bonus
Payout Percentage
(%)
Common Shares Underlying
Stock Option Award
(#)
Common Shares Underlying
Restricted Stock Award
(#)
Mr. Fishman 1,400,000 120 0 250,000
Mr. Cooper 500,000 60 50,000 25,000
Mr. Waite (1) 550,000 75 0 0
Mr. Martin 550,000 60 40,000 15,000
Ms. Bachmann 500,000 60 50,000 25,000
(1) Mr. Waite intends to retire during fiscal 2010; accordingly, the Committee did not increase Mr. Waite’s salary
or award him any equity compensation.
Additionally, in connection with the award of fiscal 2010 executive compensation, upon the recommendation
of the Committee and the approval of the other outside directors, we entered into a Retention Agreement with
Mr. Fishman on March 5, 2010. Under the Retention Agreement, Mr. Fishman is entitled to receive performance-
based restricted stock awards in fiscal 2010, as reflected above, and in fiscal 2011 and fiscal 2012 if he is employed
by us on the grant date in each such year. The number of common shares underlying the restricted stock awards to
be made in fiscal 2011 and fiscal 2012 is dependent on our performance relative to the prior fiscal year’s operating
profit, subject to collars established in the Retention Agreement. Each annual restricted stock award will vest
only if we achieve a corporate financial goal established at the beginning of the fiscal year in which the restricted
stock award is granted and Mr. Fishman remains employed by us until the first anniversary of the award. The
Committee and other outside directors determined that Mr. Fishman’s continued leadership is important to our
future performance, and they believed it was in our best interests and the best interests of our shareholders to enter
into the Retention Agreement to better assure the continuing undivided loyalty and dedication of Mr. Fishman. The
increases in salary awarded to Mr. Cooper and Ms. Bachmann were made in connection with each such executive’s
assumption of additional responsibilities and promotion to Executive Vice President in March 2010.