Big Lots 2010 Annual Report Download - page 57

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Rights Under Post-Termination and Change in Control Arrangements
Under each employment agreement, if a named executive officer is terminated for cause or due to his or her
voluntary resignation, we have no further obligation to pay any unearned compensation or to provide any future
benefits to the executive. Generally, under the terms of each named executive officer’s employment agreement,
cause for termination would exist upon the executive’s:
• failure to comply with our policies and procedures which we reasonably determine has had or is likely
to have a material adverse effect on us or our affiliates;
• willful or illegal misconduct or grossly negligent conduct that is materially injurious to us or our
affiliates;
• violation of laws or regulations governing us or our affiliates or a violation of our codes of ethics;
• breach of any fiduciary duty owed to us or our affiliates;
• misrepresentation or dishonesty which we reasonably determine has had or is likely to have a material
adverse effect on us or our affiliates;
• breach of any provision of the executive’s obligations under his or her employment agreement with us;
• involvement in any act of moral turpitude that has a materially injurious effect on us or our affiliates; or
• breach of the terms of any non-solicitation or confidentiality clauses contained in an employment
agreement with a former employer.
If terminated without cause, Mr. Fishman would continue to receive his salary for two years and each of the
other named executive officers would continue to receive his or her respective salary for one year. Each named
executive officer would receive a lump sum payment equal to two times his or her respective salary if terminated in
connection with a change in control (as discussed below). Additionally, each named executive officer (i) is eligible
(based on our achievement of at least the corporate performance amount corresponding to the floor bonus level)
to receive a prorated bonus for the fiscal year in which his or her termination is effective if he or she is terminated
without cause or in connection with his or her death or disability, and (ii) will receive two times his or her stretch
bonus if terminated following a change in control.
Upon a change in control, all outstanding stock options become exercisable to the full extent of the original
grant and all unvested restricted stock vests. Upon the named executive officer’s termination of employment, all
exercisable stock options then held may be exercised until the earlier of the stock option award expiration date
or one year after termination of employment. Additionally, if termination of employment results from death or
disability, then (i) unvested stock options awarded in fiscal 2010 and after will vest on the day such event occurred,
provided such event occurred at least six months following the grant date, and (ii) unvested restricted stock awards
will vest in increments of 20% for each consecutive year of employment completed since the grant date if the first
trigger is met while employed. Any restricted stock awards not vested at termination of employment, for reasons
other than death or disability, shall be forfeited.
Each named executive officer is entitled to receive continued healthcare coverage for up to two years following
a termination without cause or if terminated in connection with a change in control, plus the amount necessary
to reimburse him or her for the taxes he or she would be liable for as a result of such continued healthcare
coverage (“Tax Gross-Up Amount”). Upon a change in control, each participating named executive officer will
receive a lump sum payment of all amounts (vested and unvested) under the Supplemental Savings Plan. (See the
“Nonqualified Deferred Compensation” section above for more information regarding the Supplemental Savings
Plan and our named executive officers’ aggregate balances under such plans at the end of fiscal 2010.) Additionally,
if terminated without cause, Mr. Fishman is entitled to continue receiving an automobile or automobile allowance
for two years, and the other named executive officers are entitled to continue receiving an automobile or
automobile allowance for one year.
If the payments received by a named executive officer in connection with a change in control constitute an “excess
parachute payment” under Section 280G of the IRC, the named executive officer is entitled to reimbursement for
any excise tax imposed under Section 4999 of the IRC, or the executive’s benefits under his or her employment
agreement will be reduced to the extent necessary to become one dollar less than the amount that would generate