Big Lots 2009 Annual Report Download - page 73

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The 2006 Bonus Plan provides for cash compensation to be paid annually when the performance goals are
achieved. No right to a minimum bonus exists under the 2006 Bonus Plan. For each performance period, the
Committee will establish an objective formula for each participant based on the achievement of the corporate
performance amounts, the outcomes of which are substantially uncertain at the time they are established. The
Committee derives the corporate performance amounts from our corporate operating plan, as approved by the
Board at the start of the fiscal year.
The 2006 Bonus Plan provides that bonus awards in any fiscal year may not exceed the maximum bonus amount
that is established annually for each participant pursuant to a predetermined objective formula, subject to the
current maximum annual limit of $3,000,000. As discussed above, we are seeking the approval of our shareholders
to increase the current maximum annual limit to $4,000,000.
After the end of the performance period, the Committee will determine the amount of the bonus award earned
by each participant under the predetermined objective formula for the performance goals. Payment of the bonus
award to the participant will be made, subject to the participant’s right to defer the same, upon certification by the
Committee, in writing, that the performance goals were satisfied (i.e., at least the corporate performance amount
for a floor bonus was attained) and the bonus award has been calculated in accordance with the predetermined
objective formula.
In the event a participant voluntarily terminates employment with us prior to the day on which payments of bonus
awards are made under the 2006 Bonus Plan for a performance period, the participant forfeits all rights to receive
a bonus award. As discussed above, we are seeking the approval of our shareholders to allow the Committee
flexibility in determining whether a participant’s termination of employment on a day prior to the payment of
bonus awards would preclude that participant from forfeiting all rights to the bonus award. At the discretion of
the Committee, prorated bonus awards may be made to participants whose employment terminates by reason
of retirement, disability or death during a performance period; provided, however, that at least the corporate
performance amount for a floor bonus must have been attained during the performance period.
Eligibility
In the Committee’s discretion, all of our and our affiliates’ employees are eligible to participate in the 2006 Bonus
Plan. Approximately 665 of those employees are participating in the 2006 Bonus Plan in fiscal 2010.
Amendment, Suspension or Termination
The Committee may amend, in whole or in part, any or all of the provisions of the 2006 Bonus Plan, except as to
those terms or provisions that are required by Section 162(m) to be approved by the shareholders, or suspend or
terminate the 2006 Bonus Plan entirely; provided, however, that no such amendment, suspension or termination
may, without the consent of the affected participants, reduce the right of participants to any payment due under the
2006 Bonus Plan.
Plan Benefits
The exact amount of the awards under the 2006 Bonus Plan, if any, that will be allocated to or received by the
participants is at the discretion of the Compensation Committee and dependent upon our future performance, and
therefore cannot be determined at this time. The annual bonuses paid under the 2006 Bonus Plan to the named
executive officers for fiscal 2007, fiscal 2008 and fiscal 2009 are set forth in the “Non-Equity Incentive Plan
Compensation” column of the Summary Compensation Table in this Proxy Statement.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL TO APPROVE THE
AMENDED AND RESTATED 2006 BONUS PLAN.
PROPOSAL FOUR: APPROVAL OF AMENDMENTS TO OUR AMENDED ARTICLES OF
INCORPORATION TO INSTITUTE MAJORITY VOTING IN UNCONTESTED DIRECTOR ELECTIONS
After careful consideration, the Board is proposing that our Amended Articles of Incorporation (“Articles”) be
further amended to require majority voting in uncontested elections of directors. The Board has adopted a policy to
assure that a nominee for director in an uncontested election who receives fewer shareholder votes “for” his or her