Hibbett Sports 2012 Annual Report Download - page 51

47
We also maintain the Hibbett Sports, Inc. Supplemental 401(k) Plan (Supplemental Plan) for the purpose of
supplementing the employer matching contribution and salary deferral opportunity available to highly compensated employees
whose ability to receive Company matching contributions and defer salary under our existing 401(k) Plan has been limited
because of certain restrictions applicable to qualified plans. The non-qualified deferred compensation Supplemental Plan allows
participants to defer up to 40% of their compensation and receive an employer matching contribution equal to $0.75 for each
dollar of compensation deferred, subject to a maximum of 4.5% of compensation and subject to Board discretion. The matching
contribution for Fiscal 2013 has been set by the Board to equal no more than $0.75 for each dollar of compensation deferred
under both the 401(k) Plan and the Supplemental Plan up to 6.0% of compensation. Contribution expense incurred under the
Supplemental Plan for Fiscal 2012, Fiscal 2011 and Fiscal 2010 was $0.2 million, $0.1 million and $0.1 million, respectively.
The Supplemental Plan is intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as
amended.
In November 2009, the Board adopted the Hibbett Sports, Inc. Executive Voluntary Deferral Plan (Voluntary Plan) that
provides key executives of the Company an opportunity to defer, on a pre-tax basis, up to 50% of their base salary and up to
100% of any bonus earned. Participants, at election, determine the date payout is to be made with payout options as either a
lump-sum payout or installment payments over 2 to 10 years. The Voluntary Plan is subject to the Employee Retirement Income
Security Act of 1974, as amended (ERISA) and was effective February 1, 2010 and is also intended to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986, as amended.
In January 2010, we introduced a Flexible Spending Account Plan (FSA) that allows employees to set aside pre-tax
amounts for out-of-pocket health care and dependent care expenses. The health care FSA is subject to ERISA, whereas the
dependent care FSA is not. Employees are eligible to participate in the FSA upon meeting eligibility requirements or upon a
defined qualifying event, and may enroll annually during an open enrollment period. Plan amounts are determined annually by
the employee in advance and are subject to IRS dollar limitations. Employee elections, in general, cannot be increased,
decreased or discontinued during the election period. Unused amounts at the end of the plan year are subject to forfeiture and
such forfeitures can be used to offset administrative expenses. The first withholdings began in February 2010.
NOTE 8. RELATED-PARTY TRANSACTIONS
The Company leases one store under a lease arrangement with AL Florence Realty Holdings 2010, LLC, a wholly-
owned subsidiary of Books-A-Million, Inc., (BAMM). One of our Directors, Terrance G. Finley is an executive officer and
stockholder of BAMM and another Director, Albert C. Johnson, is a Director and stockholder of BAMM. The Company and
BAMM were previously subject to a sublease agreement that expired in June 2008, but was renewed under a five-year term
scheduled to expire in June 2013. The sublease was amended and restated as a direct lease in Fiscal 2012 with minimum annual
lease payments of $111,000, if not in co-tenancy. The minimum annual lease payment under the sublease was $161,000 in Fiscal
2011 and $191,000 in Fiscal 2010. There are currently no minimum lease payments under this lease.
NOTE 9. INCOME TAXES
Our effective tax rate is based on our income, statutory tax rates and tax planning opportunities available in the various
jurisdictions in which we operate. Significant judgment is required in determining our effective tax rate and in evaluating our tax
positions.
A summary of the components of the provision for income taxes is as follows (in thousands):
January 28, January 29, January 30,
2012 2011 2010
Federal:
Current 30,529$ 24,924$ 19,686$
Deferred 26 (1,136) (1,741)
30,555 23,788 17,945
State:
Current 3,820 3,572 2,366
Deferred (121) (318) (510)
3,699 3,254 1,856
Provision for income taxes 34,254$ 27,042$ 19,801$
Fiscal Year Ended