Big Lots 8-K 3-9-2007
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date
of
Report (Date of earliest event reported): March
9, 2007
BIG
LOTS, INC.
(Exact
name of registrant as specified in its charter)
Ohio
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1-8897
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06-1119097
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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300
Phillipi Road, Columbus, Ohio 43228
(Address
of principal executive offices) (Zip Code)
(614)
278-6800
(Registrant’s
telephone number, including area code)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Item
2.02
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Results
of Operations and Financial
Condition.
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On
March
9, 2007, Big Lots, Inc. (“Company”) issued a press release and conducted a
conference call/webcast, both of which reported the Company’s unaudited fourth
quarter and fiscal 2006 results, provided initial guidance for fiscal 2007,
communicated a three-year outlook, and announced that the Company’s Board of
Directors (“Board”) had authorized the repurchase of up to $600 million of the
Company’s common shares. Attached as exhibits to this Form 8-K are copies of the
Company’s March 9, 2007 press release (Exhibit 99.1) and the transcript of the
Company’s March 9, 2007 conference call/webcast (Exhibit 99.2), including
information concerning forward-looking statements and factors that may affect
the Company’s future results. The information in Exhibits 99.1 and 99.2 is being
furnished, not filed, pursuant to Item 2.02 of this Form 8-K. By furnishing
the
information in this Form 8-K and the attached exhibits, the Company is making
no
admission as to the materiality of any information in this Form 8-K or the
exhibits.
Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment
of
Certain Officers; Compensatory Arrangements of Certain
Officers.
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(e)
On March
9, 2007, the members of the Board who are not officers of the Company and who
are not involved in the daily affairs of the Company (“outside directors”), upon
the recommendation of the Compensation Committee of the Board (“Committee”),
took the following actions with respect to executive compensation: (i) approved
the fiscal 2007 salaries and bonus opportunities for the Company’s executives,
including the principal executive officer, principal financial officer and
the
other officers included as the named executive officers in the Company’s 2006
proxy statement (collectively, the “named executive officers”); (ii) determined
that bonuses will be paid for fiscal 2006 under the Big Lots 2006 Bonus Plan
(“2006 Bonus Plan”); (iii) approved the fiscal 2007 performance criteria (as
defined below) devised by the Committee under the 2006 Bonus Plan; (iv) approved
an amendment to the employment agreement of Steven S. Fishman, the Company’s
Chairman, Chief Executive Officer and President; and (v) approved non-qualified
stock option awards and restricted stock awards for the Company’s executives,
including the named executive officers, pursuant to the Big Lots 2005 Long-Term
Incentive Plan (“2005 Incentive Plan”). These actions are described in greater
detail below and in the applicable exhibits.
Salary
As
it
does annually, the Committee reviewed the compensation of the Company’s
executives, including the named executive officers, in light of its compensation
philosophy, practices and policies. Following its review, the Committee
recommended to the outside directors, among the other components of executive
compensation, the fiscal 2007 salaries for the Company’s executives. The table
below sets forth the fiscal 2006 and fiscal 2007 annual salaries for the named
executive officers. The fiscal 2007 salaries will become effective on March
25,
2007. The actual salary earned in fiscal 2006 will be reflected in the Summary
Compensation Table of the Company’s 2007 proxy statement.
Name
and Position
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Year
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Salary
($)
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Steven
S. Fishman
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2006
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960,000
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Chairman,
Chief Executive Officer and President
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2007
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1,025,000
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Joe
R. Cooper
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2006
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375,000
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Senior
Vice President and Chief Financial Officer
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2007
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400,000
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Brad
A. Waite
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2006
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520,000
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Executive
Vice President, Human Resources, Loss Prevention, Real Estate and
Risk
Management
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2007
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535,000
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John
C. Martin
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2006
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475,000
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Executive
Vice President, Merchandising
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2007
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500,000
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Lisa
M. Bachmann
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2006
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400,000
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Senior
Vice President, Information Technology / Merchandise Planning and
Allocation
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2007
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415,000
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Bonus
On
March
9, 2007, following a review of the Company’s performance in fiscal 2006, the
outside directors and Committee determined that the performance criteria
established under the 2006 Bonus Plan in February 2006 were satisfied at the
stretch (maximum) level. Accordingly, bonuses will be paid to the named
executive officers and other participants under the 2006 Bonus Plan for fiscal
2006.
On
March
9, 2007, the outside directors approved the fiscal 2007 performance criteria
recommended by the Committee which, if met, will provide a bonus under the
2006
Bonus Plan to certain employees, including the named executive officers. No
right to a minimum bonus exists under the 2006 Bonus Plan.
The
Committee derived the corporate performance measures (“performance criteria”)
and defined executives’ bonus performance goals (e.g., floor, target and
stretch) from the Company’s planned earnings for fiscal 2007, as established by
the outside directors. The specific performance criteria adopted for fiscal
2007
bonus determinations under the 2006 Bonus Plan are the greatest of the following
measures: (i) income from continuing operations; (ii) income (loss) from
continuing operations before extraordinary item and/or cumulative effect of
a
change in accounting principle (as the case may be); (iii) income before
extraordinary items; and (iv) net income, with each such measure being adjusted
to remove the effect of the equitable adjustments permitted by the 2006 Bonus
Plan. The Company’s performance criteria are established in the discretion of
the Committee and the outside directors.
Executives’
bonus performance goals are determined as a percentage of salary. The baseline
percentage of salary for each named executive officer has been established
by
his or her respective employment agreement. On March 9, 2007, the Committee
recommended, and the outside directors approved, the following fiscal 2007
target performance goals (expressed as a percentage of the named executive
officers’ fiscal 2007 salary), with the floor performance goals being one-half
of the target and the stretch performance goals being twice the target: Mr.
Fishman: 100%; Mr. Cooper: 50%; Mr. Waite: 75%; Mr. Martin: 60%; and Ms.
Bachmann: 50%. Except for Mr. Fishman’s performance goals, the fiscal 2007
performance goals for the named executive officers were not modified from the
fiscal 2006 performance goals. Also, on March 9, 2007, the outside directors
approved an amendment to Mr. Fishman’s employment agreement that increases his
target performance goal from 85% to 100% of his salary and increases his stretch
performance goal from 170% to 200% of his salary. This summary is qualified
in
its entirety by reference to the full text of the amendment to Mr. Fishman’s
employment agreement which is filed herewith as Exhibit 10.3.
Equity
On
March
9, 2007, the outside directors also determined, upon the recommendation of
the
Committee, the form and size of equity awards to be granted to the Company’s
executives, including the named executive officers, pursuant to the 2005
Incentive Plan. While the form and size of the awards was established on March
9, 2007, the outside directors directed that these awards not be granted until
March 13, 2007. This delayed date was established in order to allow the market
to absorb and react to the Company’s release of material nonpublic information,
and in order to avoid even the appearance that any employees, the Committee
or
the Board manipulated the terms of the equity awards.
The
non-qualified stock option awards are evidenced by the Big Lots 2005 Long-Term
Incentive Plan Non-Qualified Stock Option Award Agreement. The restricted stock
awards are evidenced by the Big Lots 2005 Long-Term Incentive Plan Restricted
Stock Award Agreement, the form of which is filed herewith as Exhibit
10.7.
The
following table sets forth the equity awards granted to each of the named
executive officers on March 13, 2007.
Name
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Common
Shares Underlying
Stock
Option Award
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Common
Shares Underlying
Restricted
Stock Award
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Mr.
Fishman
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250,000
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125,000
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Mr.
Cooper
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37,500
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12,500
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Mr.
Waite
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37,500
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12,500
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Mr.
Martin
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30,000
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10,000
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Ms.
Bachmann
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37,500
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12,500
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Item
9.01
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Financial
Statements and Exhibits.
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Exhibits
marked with an asterisk (*) are filed herewith. Exhibits 10.1 through 10.7
are
management contracts or compensatory plans or arrangements.
Exhibit
No.
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Description
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10.1
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Employment
Agreement with Steven S. Fishman (incorporated herein by reference
to
Exhibit 10.1 to the Company’s Form 8-K dated June 6,
2005).
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10.2
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First
Amendment to Employment Agreement with Steven S. Fishman (incorporated
herein by reference to Exhibit 10.2 to the Company’s Form 8-K dated
February 21, 2006).
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Second
Amendment to Employment Agreement with Steven S.
Fishman.
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10.4
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Big
Lots 2006 Bonus Plan (incorporated herein by reference to Exhibit
10.1 to
the Company’s Form 8-K dated May 25, 2006).
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10.5
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Big
Lots 2005 Long-Term Incentive Plan (incorporated herein by reference
to
Exhibit 10.1 to the Company’s Form 8-K dated May 17,
2005).
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10.6
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Form
of Big
Lots 2005 Long-Term Incentive Plan Non-Qualified Stock Option Award
Agreement
(incorporated herein by reference to Exhibit 10.4 to the Company’s Form
8-K dated February 21, 2006).
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10.7*
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Form
of Big
Lots 2005 Long-Term Incentive Plan Restricted Stock Award
Agreement.
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Big
Lots, Inc. press release dated March 9, 2007.
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Transcript
of Big Lots, Inc. conference call/webcast dated March 9,
2007.
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Signature
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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BIG
LOTS, INC.
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Dated:
March 15, 2007
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By:
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/s/
Charles W. Haubiel II
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Charles
W. Haubiel II
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Senior
Vice President, General Counsel and Corporate
Secretary
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