Big Lots 2014 Annual Report Download - page 35

- 23 -
Salary for Fiscal 2014
The Committee annually reviews and establishes the salary for each named executive officer. Salary serves
as a short-term retention tool. A minimum salary for Mr. Campisi and Ms. Bachmann is set forth in his or her
respective employment agreement, as described below in the “Elements of our Executive Compensation for Fiscal
2014– Employment Agreements” section of this CD&A. Salary adjustments are based on a thorough and robust
review of each named executive officer’s performance, but specific salary increases are not formally tied to any
specific accomplishment.
In reviewing the salaries of our named executive officers, the Committee considered, among other matters,
each executive’s past performance, experience, scope of responsibilities, base salary in comparison to our other
employees and anticipated future contributions. For fiscal 2014, the Committee approved the following salaries for
the named executive officers, which became effective March 30, 2014:
Name
Fiscal 2014 Salary
($)
Mr. Campisi $950,000
Mr. Johnson $510,000
Ms. Bachmann $650,000
Mr. Chene $500,000
Mr. Schlonsky $410,000
Annual Incentive Award for Fiscal 2014
Each named executive officer has the opportunity to earn an annual incentive award under the 2006 Bonus Plan.
We design our annual incentive awards to retain, motivate and reward executives on a year-to-year basis. Annual
incentive award payouts correspond to a percentage of each named executive officer’s salary (“payout percentage”)
and are based on whether we achieve certain corporate performance goals under one or more financial measures
established by the Committee when achievement of the goal is substantially uncertain. The corporate performance
goals and financial measures are set annually at the discretion of the Committee and the other outside directors
in connection with the Board’s approval of our annual corporate operating plan, subject to the terms of the 2006
Bonus Plan and, in the case or Mr. Campisi and Ms. Bachmann, their respective employment agreements.
The lowest level at which we will pay an annual incentive award under the 2006 Bonus Plan is referred to as the
“threshold.” The level at which we generally plan our performance and the associated payout under the 2006 Bonus
Plan is referred to as the “target.” The maximum level at which we will pay an annual incentive award under
the 2006 Bonus Plan is referred to as the “maximum.” If our performance in a fiscal year exceeds the minimum
corporate performance goal that earns a threshold bonus, there is a corresponding increase in the amount of the
annual incentive award (up to the maximum bonus level). Conversely, if we do not meet the minimum corporate
performance goal, executives do not receive an annual incentive award. We believe that our annual incentive
awards support our pay-for-performance philosophy and directly link the interests of our named executive
officers with those of our shareholders. See the “Bonus and Equity Plans” discussion following the Summary
Compensation Table for more information regarding our annual incentive awards.
During their annual review of executive compensation in March 2014, the Committee and other outside directors
approved the financial measure, corporate performance goals and payout percentages for the fiscal 2014 annual
incentive awards.
The Committee and the other outside directors selected operating profit as the financial measure for the fiscal
2014 annual incentive awards because they believe it is a strong indicator of our operating results and financial
condition. The Committee and other outside directors selected the corporate performance goals based on the
annual corporate operating plan established by the Board. The corporate performance goals were set at an
acceptable minimum (for the threshold annual incentive award), at (for the target annual incentive award), and
above (for the maximum annual incentive award) the projected operating profit in our annual corporate operating
plan. The Committee and other outside directors believed the selected goals provided challenging but reasonable
levels of performance that were appropriate in light of our projected corporate operating plan for fiscal 2014, and