form8k.htm
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 5, 2008
BIG
LOTS, INC.
(Exact
name of registrant as specified in its charter)
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Ohio
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1-8897
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6-1119097
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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:
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ 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
5, 2008, Big Lots, Inc. (“we,” “us” or “our”) issued a press release and
conducted a conference call, both of which reported our unaudited fourth quarter
and fiscal 2007 results, provided initial guidance for fiscal 2008, and provided
an update on our common share repurchase activity. The press release
and conference call both included “non-GAAP financial measures” as that term is
defined by Rule 101 of Regulation G (17 CFR Part 244) and Item 10 of Regulation
S-K (17 CFR Part 229). Specifically, the following non-GAAP financial
measures were included: (i) adjusted selling and administrative expenses; (ii)
adjusted operating profit; (iii) adjusted income from continuing operations
before income taxes; (iv) adjusted income tax expense; (v) adjusted income from
continuing operations; (vi) adjusted net income; and (vi) adjusted earnings per
common share – basic and diluted – for continuing operations and net
income.
These
non-GAAP financial measures exclude from the most directly comparable financial
measures calculated and presented in accordance with accounting principles
generally accepted in the United States of America (“GAAP”) after-tax net income
to continuing operations of $6.1 million related to the receipt of: (i)
settlement amounts from the KB Toys bankruptcy trust; and (ii) proceeds from
insurance claims filed as a result of hurricanes occurring in
2005. As required by Rule 100 of Regulation G and Item 10 of
Regulation S-K, the press release, which was posted in the Investor Relations
section of our website and referred to during the conference call, contained a
presentation of the most directly comparable financial measures calculated and
presented in accordance GAAP and a reconciliation of the differences between the
non-GAAP financial measures and the most directly comparable financial measures
calculated and presented in accordance with GAAP.
Our
management believes that the disclosure of these non-GAAP financial measures
provides useful information to investors because the non-GAAP financial measures
present an alternative and more relevant method for measuring our operating
performance, excluding special items included in the most directly comparable
GAAP financial measures, that our management believes is more indicative of our
ongoing operating results and financial condition. Our management
uses these non-GAAP financial measures, along with the most directly comparable
GAAP financial measures, in evaluating our operating performance.
Non-GAAP
financial measures should not be considered in isolation from, or as a
substitute for, financial information presented in accordance with
GAAP. Non-GAAP financial measures as reported by us may not be
comparable to similarly titled items reported by other companies.
Attached
as exhibits to this Form 8-K are copies of our March 5, 2008 press release
(Exhibit 99.1) and the transcript of our March 5, 2008 conference call (Exhibit
99.2), including information concerning forward-looking statements and factors
that may affect our 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, we are making no admission as to the materiality of any information in
this Form 8-K or the exhibits.
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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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(b) Section 1.5 of
our Corporate Governance Guidelines (“Guidelines”) requires any director who
retires from his or her job while serving on our Board of Directors (“Board”) to
submit a letter of resignation from the Board. On March 5, 2008, Jeffrey P.
Berger, a member of the Board, submitted a letter of resignation in connection
with his intention to retire from H.J. Heinz Co. on May 1,
2008. Consistent with the Guidelines, the Nominating and Corporate
Governance Committee reviewed the continued appropriateness of Mr. Berger’s
ongoing Board membership in light of his planned retirement and recommended to
the Board that Mr. Berger continue to serve as a
director. Thereafter, the Board unanimously (with Mr. Berger recusing
himself) rejected Mr. Berger’s letter of resignation, and Mr. Berger agreed to
continue his service on the Board.
(e) On March 5,
2008, upon the recommendation of the Compensation Committee (“Committee”) of the
Board, the independent, non-management members of the Board (“outside
directors”) took the following actions with respect to the compensation for our
principal executive officer, principal financial officer and the other executive
officers included as named executive officers in our 2007 proxy statement
(collectively, the “named executive officers”): (i) determined that our
corporate performance in fiscal 2007 resulted in bonuses being earned under the
Big Lots 2006 Bonus Plan (“2006 Bonus Plan”); (ii) approved fiscal 2008
salaries; (iii) approved fiscal 2008 bonus opportunities under the 2006 Bonus
Plan; and (iv) approved non-qualified stock option awards and restricted stock
awards under the Big Lots 2005 Long-Term Incentive Plan (“2005 Incentive
Plan”).
Salary
The table
below sets forth the annualized salary established for each named executive
officer during the first quarter of the current and immediately prior fiscal
years. The fiscal 2008 salaries will become effective on March 23,
2008. The actual salary earned in fiscal 2007 will be reflected in
the Summary Compensation Table of our 2008 proxy statement.
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Name and
Position
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Year
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Salary ($)
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Steven
S. Fishman
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2008
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1,200,000 |
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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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2008
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440,000 |
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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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2008
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550,000 |
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Executive
Vice President, Human Resources, Loss Prevention 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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2008
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520,000 |
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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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2008
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440,000 |
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Senior
Vice President, Merchandise Planning/Allocation and Chief Information
Officer
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2007
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415,000 |
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Bonus
On March
5, 2008, as recommended by the Committee, the outside directors approved the
financial measure and corporate performance amounts that will dictate whether a
bonus is earned for fiscal 2008 under the 2006 Bonus Plan. The
financial measure and corporate performance amounts were derived from our annual
corporate operating plan for fiscal 2008, as established by the
Board. The financial measure adopted for fiscal 2008 bonus
determinations is our operating profit, as adjusted to remove the effect of the
equitable adjustments set forth in the 2006 Bonus Plan. The financial
measure and corporate performance amounts are established at the discretion of
the Committee and the outside directors, subject to the terms of the 2006 Bonus
Plan.
As
recommended by the Committee, the outside directors also approved the following
fiscal 2008 payout percentages for the named executive officers (expressed as a
percentage of each named executive officer’s fiscal 2008 salary), with the floor
payout percentages being one-half of the target and the stretch payout
percentages being twice the target: Mr. Fishman: 100%; Mr. Cooper: 60%; Mr.
Waite: 75%; Mr. Martin: 60%; and Ms. Bachmann: 60%. Except for
increases from 50% to 60% for Mr. Cooper and Ms. Bachmann, the fiscal 2008
payout percentages for the named executive officers were not modified from the
fiscal 2007 payout percentages. The lowest floor and target payout
percentages that may be set annually for each named executive officer have been
established by his or her respective employment agreement.
The 2006
Bonus Plan is filed herewith as Exhibit 10.1 and is incorporated herein by
reference.
Equity
On March
5, 2008, the outside directors approved, upon the recommendation of the
Committee, the form and size of equity awards to be granted to each named
executive officer pursuant to the 2005 Incentive Plan. The outside
directors directed that these equity awards be granted on March 7,
2008. This delayed date was established in order to allow the market
to absorb and react to our release of material non-public information on March
5, 2008, and in order to avoid even the appearance that any employee, the
Committee or the Board manipulated the terms of the equity
awards. The following table sets forth the equity awards granted to
each of the named executive officers on March 7, 2008.
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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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330,000 |
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165,000 |
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Mr.
Cooper
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48,750 |
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16,250 |
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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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37,500 |
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12,500 |
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Ms.
Bachmann
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48,750 |
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16,250 |
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The 2005
Incentive Plan is filed herewith as Exhibit 10.2 and is incorporated herein by
reference. The non-qualified stock option awards are evidenced by the
Big Lots 2005 Long-Term Incentive Plan Non-Qualified Stock Option Award
Agreement, the form of which is filed herewith as Exhibit 10.3 and is
incorporated herein by reference. 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 10.4 and is
incorporated herein by reference.
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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
10.4 are management contracts or compensatory plans or
arrangements.
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Exhibit
No.
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Description
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10.1
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Big
Lots 2006 Bonus Plan (incorporated herein by reference to Exhibit 10.1 to
our Form 8-K dated May 25, 2006).
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10.2
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Big
Lots 2005 Long-Term Incentive Plan (incorporated herein by reference to
Exhibit 10.1 to our Form 8-K dated May 17, 2005).
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10.3
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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 our Form
8-K dated February 21, 2006).
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10.4
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Form
of Big Lots 2005 Long-Term Incentive Plan Restricted Stock Award Agreement
(incorporated herein by reference to Exhibit 10.7 to our Form 8-K dated
March 9, 2007).
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Big
Lots, Inc. press release dated March 5, 2008.
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Transcript
of Big Lots, Inc. conference call dated March 5,
2008.
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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
11, 2008
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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, Legal and Real Estate
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General
Counsel and Corporate Secretary
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