Big Lots 2012 Annual Report Download - page 142

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BIG LOTS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 7 — Share-Based Plans (Continued)
During 2012, 2011, and 2010, the following activity occurred under our share-based compensation plans:
(In thousands) 2012 2011 2010
Total intrinsic value of stock options exercised ......................... $29,350 $ 8,747 $32,537
Total fair value of restricted stock vested .............................. $21,907 $11,618 $31,150
The total unearned compensation cost related to all share-based awards outstanding at February 2, 2013 was
approximately $28.3 million. This compensation cost is expected to be recognized through January 2017 based
on existing vesting terms with the weighted-average remaining expense recognition period being approximately
2.2 years from February 2, 2013.
Note 8 — Employee Benefit Plans
Pension Benefits
We maintain the Pension Plan and Supplemental Pension Plan covering certain employees whose hire date was
on or before April 1, 1994. Benefits under each plan are based on credited years of service and the employee’s
compensation during the last five years of employment. The Supplemental Pension Plan is maintained for certain
highly compensated executives whose benefits were frozen in the Pension Plan in 1996. The Supplemental Pension
Plan is designed to pay benefits in the same amount as if the participants continued to accrue benefits under the
Pension Plan. We have no obligation to fund the Supplemental Pension Plan, and all assets and amounts payable
under the Supplemental Pension Plan are subject to the claims of our general creditors.
The components of net periodic pension expense were comprised of the following:
(In thousands) 2012 2011 2010
Service cost - benefits earned in the period .......................... $ 2,171 $ 2,211 $ 2,433
Interest cost on projected benefit obligation .......................... 3,292 3,496 3,254
Expected investment return on plan assets ........................... (3,089) (4,627) (4,249)
Amortization of prior service cost ................................. (34) (34) (34)
Amortization of transition obligation ............................... 13 13 13
Amortization of actuarial loss ..................................... 2,345 1,796 2,217
Settlement loss ................................................ 298 298 1,785
Net periodic pension cost ..................................... $ 4,996 $ 3,153 $ 5,419
In 2012, 2011, and 2010, we incurred pretax non-cash settlement charges of $0.3 million, $0.3 million and
$1.8 million, respectively. The settlement charges were caused by lump sum benefit payments made to plan
participants in excess of combined annual service cost and interest cost for each year.
The weighted-average assumptions used to determine net periodic pension expense were:
2012 2011 2010
Discount rate ............................................................ 5.0% 5.7% 5.7%
Rate of increase in compensation levels ....................................... 3.5% 3.9% 3.5%
Expected long-term rate of return ............................................ 5.5% 8.0% 8.0%
The weighted-average assumptions used to determine benefit obligations were:
2012 2011
Discount rate ................................................................. 4.6% 5.0%
Rate of increase in compensation levels ............................................ 3.5% 3.5%