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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K/A
(Amendment
No. 1)
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the
fiscal year ended February 2, 2008
Commission
file number 1-8897
BIG
LOTS, INC.
(Exact
name of registrant as specified in its charter)
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Ohio
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06-1119097
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(State
or other jurisdiction of
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(I.R.S.
Employer
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incorporation
or organization)
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Identification
No.)
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300
Phillipi Road, P.O. Box 28512, Columbus, Ohio
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43228-5311
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(Address
of principal executive offices)
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(Zip
Code)
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(614)
278-6800
(Registrant’s
telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Act:
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Title of each
class
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Name of each exchange
on which registered
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Common
Shares $0.01 par value
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New
York Stock
Exchange
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Securities
registered pursuant to Section 12(g) of the Act: None.
Indicate
by check mark if the Registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes x No o
Indicate
by check mark if the Registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes o No x
Indicate
by check mark whether the Registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes x No o
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of the Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. o
Indicate
by check mark whether the Registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated
filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2
of the Exchange Act. (Check one):
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Large
accelerated filer x
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Accelerated
filer o
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Non-accelerated
filer o
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Smaller
reporting company o
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Indicate
by check mark whether the Registrant is a shell company (as defined by Rule
12b-2 of the Act). Yes o No x
The
aggregate market value of the Common Shares held by non-affiliates of the
Registrant (assuming for these purposes that all executive officers and
directors are “affiliates” of the Registrant) was $2,506,932,554 on August 4,
2007, the last business day of the Registrant’s most recently completed second
fiscal quarter (based on the closing price of the Registrant’s Common Shares on
such date as reported on the New York Stock Exchange).
The
number of the Registrant’s Common Shares outstanding as of March 28, 2008 was
81,370,433.
Documents Incorporated by
Reference
Portions
of the Registrant's Proxy Statement for its 2008 Annual Meeting of Shareholders
are incorporated by reference into Part III of the Annual Report on Form
10-K.
EXPLANATORY
NOTE
On April
1, 2008, Big Lots, Inc. (“we,” “us,” and “our”) filed our Annual Report on Form
10-K for the fiscal year ended February 2, 2008 (“Form 10-K”). We
unintentionally omitted Exhibit 10.30 from our Form 10-K filing. We
are filing this amendment to the Form 10-K (“Amendment No. 1”) to file Exhibit
10.30. As required by Rule 12b-15 under the Securities Exchange Act
of 1934, as amended (“Exchange Act”), we have set forth the complete text of
Item 15(a)(3) as amended.
In
addition, as required by Rule 12b-15 under the Exchange Act, new certifications
by our principal executive officer and principal financial officer are filed as
exhibits to this Amendment No. 1. This Amendment No. 1 does not
otherwise update information in the Form 10-K to reflect events occurring
subsequent to the date of the Form 10-K. Except as described above, no
other amendments are being made to the Form 10-K.
PART
IV
ITEM
15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
(a)(3)
Exhibits. Exhibits
marked with an asterisk (*) were filed with the Form 10-K. Exhibits
marked with two asterisks (**) are filed with this Amendment No.
1. Copies of exhibits will be furnished upon written request and
payment of our reasonable expenses in furnishing the
exhibits. Exhibits 10.1 through 10.33 are management contracts or
compensatory plans or arrangements.
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Exhibit
No.
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Document
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2
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Agreement
of Merger (incorporated herein by reference to Exhibit 2 to our Form 10-Q
for the quarter ended May 5, 2001).
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3.1
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Amended
Articles of Incorporation (incorporated herein by reference to Exhibit
3(a) to our Form 10-Q for the quarter ended May 5,
2001).
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3.2
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Code
of Regulations (incorporated herein by reference to Exhibit 3(b) to our
Form 10-Q for the quarter ended May 5, 2001).
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4
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Specimen
Common Share Certificate (incorporated herein by reference to Exhibit 4(a)
to our Form 10-K for the year ended February 2, 2002).
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10.1
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Big
Lots, Inc. 1996 Performance Incentive Plan (incorporated herein by
reference to Exhibit 10 to our Post-Effective Amendment No. 1 to Form
S-8).
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10.2
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Amendment
to the Big Lots, Inc. 1996 Performance Incentive Plan (incorporated herein
by reference to Exhibit 10.3 to our Form 8-K dated August 17,
2005).
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10.3
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Form
of Non-Qualified Stock Option Grant Agreement under the Big Lots, Inc.
1996 Performance Incentive Plan (incorporated herein by reference to
Exhibit 10.2 to our Form 8-K dated September 9, 2004).
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10.4
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Form
of Restricted Stock Award Agreement under the Big Lots, Inc. 1996
Performance Incentive Plan (incorporated herein by reference to Exhibit
10.3 to our Form 8-K dated January 6, 2005).
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10.5
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Form
of Restricted Stock Award Agreement under the Big Lots, Inc. 1996
Performance Incentive Plan (incorporated herein by reference to Exhibit
10.1 to our Form 8-K dated July 11,
2005).
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10.6
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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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10.7
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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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10.8
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Form
of Big Lots 2005 Long-Term Incentive Plan Restricted Stock Award Agreement
(incorporated herein by reference to Exhibit 10.5 to our Form 8-K dated
February 21, 2006).
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10.9
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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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10.10
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Big
Lots, Inc. Amended and Restated Director Stock Option Plan (incorporated
herein by reference to Exhibit 10 to our Post-Effective Amendment No. 1 to
Form S-8).
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10.11
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First
Amendment to Big Lots, Inc. Amended and Restated Director Stock Option
Plan (incorporated herein by reference to Exhibit 10(d) to our Form 10-Q
for the quarter ended August 3, 2002).
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10.12
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Form
of Option Award Agreement under the Big Lots, Inc. Amended and Restated
Director Stock Option Plan (incorporated herein by reference to Exhibit
10.1 to our Form 8-K dated September 9, 2004).
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10.13
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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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10.14
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Big
Lots Savings Plan (incorporated herein by reference to Exhibit 10.8 to our
Form 10-K for the year ended January 29, 2005).
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10.15
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Big
Lots Supplemental Savings Plan, as amended and restated effective January
1, 2008 (incorporated herein by reference to Exhibit 10.1 to our Form 8-K
dated August 28, 2007).
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10.16
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Big
Lots Defined Benefit Pension Plan (incorporated herein by reference to
Exhibit 10.10 to our Form 10-K for the year ended January 29,
2005).
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10.17
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Big
Lots Supplemental Defined Benefit Pension Plan, as amended and restated
effective January 1, 2008 (incorporated herein by reference to Exhibit
10.2 to our Form 8-K dated August 28, 2007).
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10.18
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Big
Lots Executive Benefit Plan (incorporated herein by reference to Exhibit
10(m) to our Form 10-K for the year ended January 31,
2004).
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10.19
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Big
Lots, Inc. Non-Employee Director Compensation Package, effective August
15, 2006 (incorporated herein by reference to Exhibit 10.1 to our Form 8-K
dated August 15, 2006).
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10.20
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Employment
Agreement with Steven S. Fishman (incorporated herein by reference to
Exhibit 10.1 to our Form 8-K dated June 6, 2005).
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10.21
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First
Amendment to Employment Agreement with Steven S. Fishman (incorporated
herein by reference to Exhibit 10.2 to our Form 8-K dated February 21,
2006).
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10.22
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Second
Amendment to Employment Agreement with Steven S. Fishman (incorporated
herein by reference to Exhibit 10.3 to our Form 8-K dated March 9,
2007).
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10.23
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Employment
Agreement with John C. Martin (incorporated herein by reference to Exhibit
10 to our Form 10-Q for the quarter ended November 1,
2003).
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10.24
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Employment
Agreement with Brad A. Waite (incorporated herein by reference to Exhibit
10(s) to our Form 10-K for the year ended January 31,
2004).
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10.25
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Employment
Agreement with Donald A. Mierzwa (incorporated herein by reference to
Exhibit 10(r) to our Form 10-K for the year ended January 31,
2004).
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10.26
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Employment
Agreement with Charles W. Haubiel II (incorporated herein by reference to
Exhibit 10.2 to our Form 10-Q for the quarter ended April 30,
2005).
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10.27
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Employment
Agreement with Joe R. Cooper (incorporated herein by reference to Exhibit
10.1 to our Form 10-Q for the quarter ended April 30,
2005).
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10.28
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Employment
Agreement with Lisa M. Bachmann (incorporated herein by reference to
Exhibit 10.1 to our Form 8-K dated August 29, 2005).
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10.29
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Employment
Agreement with Norman J. Rankin (incorporated herein by reference to
Exhibit 10.1 to our Form 10-Q for quarter ended April 29,
2006).
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Employment
Agreement with Robert S. Segal.
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10.31
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Form
of Executive Severance Agreement (incorporated herein by reference to
Exhibit 10(r) to our Form 10-K for the year ended January 30,
1999).
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10.32
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Form
of Senior Executive Severance Agreement (incorporated herein by reference
to Exhibit 10(s) to our Form 10-K for the year ended January 30,
1999).
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10.33
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Form
of Retention Package Memorandum (incorporated herein by reference to
Exhibit 10.2 to our Form 8-K dated January 6, 2005).
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10.34
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Credit
Agreement among Big Lots Stores, Inc., as borrower, the Guarantors named
therein, and the Banks named therein (incorporated herein by reference to
Exhibit 10.1 to our Form 8-K dated October 29, 2004).
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10.35
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First
Amendment to Credit Agreement among Big Lots Stores, Inc., as borrower,
the Guarantors named therein, and the Banks named therein (incorporated
herein by reference to Exhibit 10.2 to our Form 8-K dated October 25,
2005).
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10.36
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Second
Amendment to Credit Agreement among Big Lots Stores, Inc., as borrower,
the Guarantors named therein, and the Banks named therein (incorporated
herein by reference to Exhibit 10.36 to our Form 10-K for the year ended
February 3, 2007).
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10.37
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Security
Agreement between Big Lots Stores, Inc. and Big Lots Capital, Inc.
(incorporated herein by reference to Exhibit 10.2 to our Form 8-K dated
October 29, 2004).
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10.38
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Stock
Purchase Agreement between KB Acquisition Corporation and Consolidated
Stores Corporation (incorporated herein by reference to Exhibit 2(a) to
our Form 10-Q for the quarter ended October 28, 2000).
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21*
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Subsidiaries.
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23*
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Consent
of Deloitte & Touche LLP.
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24*
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Power
of Attorney for Sheldon M. Berman, David T. Kollat, Brenda J. Lauderback,
Philip E. Mallott, Jeffrey P. Berger, Russell Solt, James R. Tener, and
Dennis B. Tishkoff.
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31.1*
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Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
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Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
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31.2*
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Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
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Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
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32.1*
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Certification
of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
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32.2*
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Certification
of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
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SIGNATURE
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this Amendment No. 1 to its Annual Report
on Form 10-K to be signed on its behalf by the undersigned, thereunto duly
authorized, on this 9th day of April 2008.
BIG LOTS,
INC.
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By:
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/s/ Joe R. Cooper
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Joe
R. Cooper
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Senior
Vice President and
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Chief
Financial Officer
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EXHIBIT
31.1.1
CERTIFICATION
OF CHIEF EXECUTIVE OFFICER
PURSUANT
TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I,
Steven S. Fishman, certify that:
1.
I have reviewed this Amendment No. 1 to the Annual Report on Form 10-K of Big
Lots, Inc.; and
2.
Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report.
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Dated:
April 9, 2008
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By:
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/s/ Steven S. Fishman
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| Steven S. Fishman | ||
| Chairman of the Board, Chief Executive Officer | ||
| and President | ||
EXHIBIT
31.2.1
CERTIFICATION
OF CHIEF FINANCIAL OFFICER
PURSUANT
TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Joe R.
Cooper, certify that:
1. I have
reviewed this Amendment No. 1 to the Annual Report on Form 10-K of Big Lots,
Inc.; and
2. Based
on my knowledge, this report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report.
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Dated:
April 9, 2008
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By:
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/s/ Joe R. Cooper
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Joe
R. Cooper
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Senior
Vice President and
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Chief
Financial Officer
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||
EXHIBIT
10.30
EMPLOYMENT
AGREEMENT
BETWEEN
BIG
LOTS
AND
ROBERT
S. SEGAL
This
employment agreement (“Agreement”) by and between Big Lots Stores, Inc. and its
parent, affiliates, predecessor, successor, subsidiaries and other related
companies (the “Company”) and Robert S. Segal (the “Executive”),
collectively, the “Parties,” is effective as of the date signed (“Effective
Date”) and supersedes and replaces any other oral or written employment-related
agreement between the Executive and the Company.
1.00 Duration
This
Agreement will remain in effect from the Effective Date until it terminates as
provided in Section 5.00. Any notice of termination required to be
given under this Agreement must be given as provided in Section 6.00 and will be
effective on the date prescribed in Section 5.00.
2.00 Executive’s
Employment Function
2.01 Position. The
Executive agrees to serve as the Company’s Vice President, Divisional
Merchandise Manager (or other appropriate title as designated by the Company in
its sole discretion) with the authority and duties customarily associated with
this position. The Executive agrees at all times to observe and be
bound by all Company rules, policies, practices, procedures and resolutions
which apply to Company employees and which do not conflict with the specific
terms of this Agreement.
2.02 Place of
Performance. The Executive’s duties will principally be
performed in Columbus, Ohio, except for required travel on the Company’s
business, unless the Company requires the Executive to perform duties at another
location.
3.00 Compensation
The
Company will pay the Executive the amounts described in this Section 3.00
as compensation for the services described in this Agreement and in exchange for
the duties and responsibilities described in Section 4.00. In
addition, on the first day of employment, the Executive will receive a grant of
an option to acquire 30,000 shares of Big Lots, Inc. common stock in accordance
the terms and conditions of the Big Lots, Inc. 1996 Performance Incentive
Plan.
3.01 Base Salary. The
Company will pay to the Executive an annualized base salary of $300,000, which
may be adjusted at the Company’s discretion (“Base Salary”). The
Executive’s Base Salary will be paid in installments that correspond with the
Company’s normal payroll practices. The Base Salary may be adjusted
from time to time in a manner that is consistent with the Company’s compensation
policies in effect for executives in the same or similar job classification at
the discretion of the Company, but will not be adjusted to any amount lower than
$300,000.
3.02 Bonus. The
Executive shall be eligible to receive bonus compensation (“Bonus”), for the
fiscal year beginning January 30, 2005, and for each subsequent fiscal year of
employment completed during the term of this Agreement. The
Executive’s bonus shall be an amount equal to the Base Salary at the end of such
fiscal year multiplied by the Bonus Payout percentage as determined by the Bonus
Program set each fiscal year by the compensation committee of Big Lots, Inc.’s
Board of Directors. The Bonus Program is based upon the achievement
of the Company’s annual financial plan. The target bonus for the
Executive is 40% of Base Salary and the Stretch Bonus for the Executive is 80%
of Base Salary, both of which are defined in the Bonus Program and are subject
to adjustment by Big Lots, Inc.’s Board of Directors; provided, however, the
Executive’s target bonus shall never fall below 40% of Base Salary and the
Executive’s Stretch Bonus shall never fall below 80% of Base
Salary.
[1] Payment. Any
bonuses described herein will be paid at a time consistent with payment of
bonuses to Executives in the same or similar job classifications.
[2] Continuous
Employment. In order to receive any bonus as provided herein,
Executive must remain continuously employed by the Company pursuant to the terms
and conditions of this Agreement.
[3] Fiscal Year. The
term “fiscal year” shall mean the period commencing on the Sunday next following
the Saturday closest to January 31st in a
calendar year and ending the next following calendar year on the Saturday
closest to January 31st.
3.03 Bonus Upon Commencement of
Employment. Within 30 days after the Executive’s commencement
of employment under this Agreement, the Company will pay to the Executive a
one-time sign on bonus of $100,000.
3.04 Benefit
Plans. Subject to their terms, the Executive may participate
in any Company-sponsored employee pension or welfare benefit plan at a level
commensurate with the Executive’s title and position.
3.05 Vacation and Sick
Leave. The Executive shall be entitled to such periods of
vacation and sick leave each year as provided under the Company’s vacation and
sick leave policy at a level commensurate with the Executive’s title and
position.
3.06 Expenses. The
Executive is entitled to receive reimbursement for all normal and reasonable
expenses incurred while performing services under this Agreement, including
reasonable travel expenses. Reimbursement for these expenses will be
made as soon as administratively feasible after the date the Executive submits
appropriate evidence of the expenditure and otherwise complies with the
Company’s business expense reimbursement policies.
3.07 Automobile
Allowance. The Company will provide the Executive with an
automobile or a monthly automobile allowance in accordance with applicable
Company policies for executives of the same or similar title and
position.
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2
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Initials
RS Date
11-08-04
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3.08 Termination
Benefits. The Company will provide the Executive with only
those termination benefits described in Section 5.00.
4.00 Executive’s
Obligations
The
amounts described in Sections 3.00 and 5.00 of this Agreement are provided by
the Company in exchange for (and have a value to the Company equivalent to) the
Executive’s performance of the obligations described in this Agreement,
including performance of the duties and the covenants made and entered into by
and between the Executive and the Company in this Agreement.
4.01 Scope of
Duties. The Executive will:
[1] Devote
all available business time, best efforts and undivided attention to the
Company’s business and affairs; and
[2] Not
engage in any other business activity, whether for gain, profit or other
pecuniary benefit.
[3] However,
the restriction described in Subsections 4.01[1] and [2] will not preclude
the Executive from:
[a] Making
or holding passive investments in outstanding shares in the securities of
publicly-owned companies or other businesses (other than organizations described
in Section 4.05), regardless of when and how that investment was made;
or
[b] Serving
on corporate, civic, religious, educational and/or charitable boards or
committees but only if this activity [i] does not interfere
with the performance of duties under this Agreement and [ii] is approved in
writing by the Company.
4.02 Confidential
Information.
[1] Obligation to Protect Confidential
Information. The Executive acknowledges that the Company, its
parent, affiliates, predecessor, successor, subsidiaries and other related
companies (collectively, “Group” and separately, “Group Member”) have a
legitimate and continuing proprietary interest in the protection of Confidential
Information (as defined in Subsection 4.02[2]) and have invested, and will
continue to invest, substantial sums of money to develop, maintain and protect
Confidential Information. The Executive agrees [a] during and after
employment with the Company and as to all Group Members [i] that any Confidential
Information will be held in confidence and treated as proprietary to the Group,
[ii] not to use or
disclose any Confidential Information except to promote and advance the Group’s
business interests and [b] immediately upon
termination for any reason from employment with the Company, to return to the
Company any Confidential Information.
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3
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Initials
RS Date
11-08-04
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[2] Definition of Confidential
Information. For purposes of this Agreement, Confidential
Information includes any confidential data, figures, projections, estimates,
pricing data, customer lists, buying manuals or procedures, distribution manuals
or procedures, other policy and procedure manuals or handbooks, supplier
information, tax records, personnel histories and records, information regarding
sales, information regarding properties and any other Confidential Information
regarding the business, operations, properties or personnel of the Company or
the Group (or any Group Member) which are disclosed to or learned by the
Executive as a result of employment with the Company, but will not include [a] the Executive’s
personal personnel records or [b] any information that
[i] the Executive
possessed before the date of initial employment (including periods before the
Effective Date) with the Company that was a matter of public knowledge, [ii] became or becomes a
matter of public knowledge through sources independent of the Executive, [iii] has been or is
disclosed by any Group Member without restriction on its use or [iv] has been or is
required to be disclosed by law or governmental order or
regulation. The Executive also agrees that, if there is any
reasonable doubt whether an item is public knowledge, to not regard the item as
public knowledge until and unless the Company’s General Counsel confirms to the
Executive that the information is public knowledge or an arbitrator, acting
under Section 9.00, finally decides that the information is public
knowledge.
[3] Intellectual
Property. The Executive expressly acknowledges that all right,
title and interest to all inventions, designs, discoveries, works of authorship,
and ideas conceived, produced, created, discovered, authored, or reduced to
practice during the Executive’s performance of services under this Agreement,
whether individually or jointly with the Company or any Group Member (the
“Intellectual Property”) shall be owned solely by the Company or the Group, and
shall be subject to the restrictions set forth in Subsection 4.02[1]
above. All Intellectual Property which constitutes copyrightable
subject matter under the copyright laws of the United States shall, from the
inception of creation, be deemed to be a “work made for hire” under the United
States copyright laws and all right, title and interest in and to such
copyrightable works shall vest in the Company or the Group. All
right, title and interest in and to all Intellectual Property developed or
produced under this Agreement by the Executive, whether constituting patentable
subject matter or copyrightable subject matter (to the extent deemed not to be a
“work made for hire”) or otherwise, shall be assigned and is hereby irrevocably
assigned to the Company or the Group by the Executive. The Executive
shall, without any additional consideration, execute all documents and take all
other actions needed to convey the Executive’s complete ownership interest in
any Intellectual Property to the Company or the Group or the Executive is
directed so that the Company or the Group may own and protect such Intellectual
Property and obtain patent, copyright and trademark registrations for
it. The Executive agrees that any Group Member may alter or modify
the Intellectual Property at the Group Member’s sole discretion, and the
Executive waives all right to claim or disclaim authorship.
4.03 Solicitation of
Employees. The Executive agrees that during employment, or for
two years after terminating employment with the Company [1] not, directly or
indirectly, to solicit any employee of the Company or of any Group Member to
leave employment with the Group, [2] not, directly or
indirectly, to employ or seek to employ any employee of the Company or any Group
Member and [3] not
to cause or induce any of the Company’s or the Group’s (or Group Member’s)
competitors to solicit or employ any employee of the Company or any Group
Member.
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4
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Initials
RS Date
11-08-04
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4.04 Solicitation of Third
Parties. The Executive agrees that during employment, and for
two years after terminating employment with the Company not, directly or
indirectly, to recruit, solicit or otherwise induce or influence any customer,
supplier, sales representative, lender, lessor, lessee or any other person
having a business relationship with the Company or the Group (or any Group
Member) to discontinue or reduce the extent of that relationship except in the
course of discharging the duties described in this Agreement and with the good
faith objective of advancing the Company’s or the Group’s (or any Group
Member’s) business interests.
4.05 Non-Competition. The
Executive acknowledges that the principal business of the Company includes the
operation of its Big Lots retail outlets, the inventories of which are acquired
primarily through special purchases such as overstocks, close-outs,
liquidations, bankruptcies, wholesale distribution of overstock, distress,
liquidation and other volume inventories, the operation of its Big Lots
Furniture stores, and its wholesale operations all of which comprise the
Company’s business (the “Company Business”); that Company is one of the limited
number of entities which has developed such business; that the Company Business
is national in scope and the Executive’s work for the Company will give him
access to the confidential affairs of the Company and the Group as defined in
Subsection 4.02[2]; and the agreements and covenants of the Executive contained
in Section 4.00 are essential to the business and the good will of the
Company. Accordingly, the Executive covenants and agrees
that:
[1] During
the term of the Executive’s employment with the Company and for a period of one
year (the “Restricted Period”) following the termination of his employment in
any manner, the Executive shall not in any location where the Company’s retail
stores are located throughout the United States [a] engage in the Company
Business for the Executive’s own account, [b] render any services
to any person engaged in the Company Business (other than to the Company); or
[c] become employed
in any manner by, or consult with, Wal-Mart, Sam’s Club, Kmart, Target, Dollar
General, Family Dollar, Dollar Tree, Value City/Schottenstein Stores
Corporation, Fred’s, 99¢ Stores, Canned Foods, Tuesday Morning, TJX Corporation,
Rooms To Go, Office Depot, Costco, Staples, American Signature, Ashley
Furniture, HomeStores, Art Van, Office Max, Value City Furniture or Nationwide
Furniture Warehouse, or any grocery or furniture store chain regardless of
size. Further, the Executive agrees to not become employed in any
manner or to act as consultant to any parent or subsidiary of the above-listed
entities. In the event of a change of control as defined in
Subsection 5.07[2] of this Agreement, the restricted period shall be for a
period of six (6) months.
[2] Acknowledgement. The
Executive acknowledges that the non-competition agreement is reasonable in light
of the nature of the Company Business; that the Company has legitimate business
reasons for requiring the Executive’s agreement to all provisions of Section
4.00; and that he understands the restrictions, has had an opportunity to fully
discuss these restrictions with the Company and accepts the
restrictions.
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[3] Maximum Enforceable
Restriction. In the event that any or all of the covenants set
forth in this Section 4.05 are determined by a court of competent jurisdiction
to be unenforceable by reason of the temporal restrictions being too great, the
geographic areas covered too great, the range of activities too great or for any
other reason, then the Court is authorized and shall interpret them to extend
over the maximum period of time, the maximum geographic area and the maximum
range of activities or, as to any provision, in such a manner that all
provisions may be given maximum restrictive effect in accordance with applicable
law.
[4] Tolling. The
Executive agrees that if any of the obligations to the Company under this
Subsection 4.05 are breached, then the restricted period shall be extended
for the length of time that the Executive failed to fulfill his obligations
under Subsection 4.05.
4.06 Post-Termination
Cooperation. As is required of the Executive during
employment, the Executive agrees that during and after employment with the
Company and without additional compensation (other than reimbursement for
reasonable associated expenses), to cooperate with the Company in the following
areas:
[1] Cooperation With the
Company. The Executive agrees [a] to be reasonably
available to answer questions for the Company’s officers regarding any matter,
project, initiative or effort for which the Executive was responsible while
employed by the Company and [b] to cooperate with the
Company or any Group Member during the course of all third-party proceedings
arising out of the Company Business about which the Executive has knowledge or
information. For purposes of this Agreement, [c] ”proceedings”
includes internal investigations, administrative investigations or proceedings
and lawsuits (including pre-trial discovery and trial testimony) and [d] ”cooperation”
includes [i] the
Executive’s being reasonably available for interviews, meetings, depositions,
hearings and/or trials without the need for subpoena or assurances by the
Company or any Group Member; [ii] providing any and
all documents in the Executive’s possession that relate to the proceeding; and
[iii] providing
assistance in locating any and all relevant notes and/or documents.
[2] Cooperation With Third
Parties. Unless compelled to do so by lawfully-served subpoena
or court order, the Executive agrees not to communicate with, or give statements
or testimony to, any opposing attorney, opposing attorney’s representative
(including private investigator) or current or former employee relating to any
matter (including pending or threatened lawsuits or administrative
investigations) about which the Executive has knowledge or information (other
than knowledge or information that is not Confidential Information as defined in
Subsection 4.02[2]) except in cooperation with the Company and Group
Members. The Executive also agrees to notify the Company’s General
Counsel immediately after being contacted by a third party or receiving a
subpoena or court order to appear and testify with respect to any matter
affected by this section.
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[3] Cooperation With
Media. The Executive agrees not to communicate with, or give
statements to, any member of the media (including print, television or radio
media) relating to any matter (including pending or threatened lawsuits or
administrative investigations) about which the Executive has knowledge or
information (other than knowledge or information that is not Confidential
Information as defined in Subsection 4.02[2]) except in cooperation with
the Company or any Group Member. The Executive also agrees to notify
the Company’s General Counsel immediately after being contacted by any member of
the media with respect to any matter affected by this section.
4.07 Non-Disparagement. The
Executive and the Company agree that neither will make any disparaging remarks
about the other and the Executive will not make any disparaging remarks about
the Company, the Company’s Chairman, Chief Executive Officer or any of the
Company’s executives or any Group Member or their
executives. However, this section will not preclude [1] any remarks that may
be made by the Executive under the terms of Subsection 4.06[2] or that are
required to discharge the duties described in this Agreement or [2] the Company or Group
Members from making (or eliciting from any person) disparaging remarks about the
Executive concerning any conduct that may lead to a termination for Cause, as
defined in Subsection 5.04[3] (including initiating an inquiry or
investigation that may result in a termination for Cause).
4.08 Notice of Subsequent
Employment. The Executive agrees to notify the Company of any
subsequent employment during the Restricted Period after employment
terminates.
4.09 Remedies. The
Executive agrees that any breach of any of the terms of this Section 4.00 would
result in irreparable injury and damage to the Company for which the Company
would have no adequate remedy at law; the Executive therefore also agrees that
in the event of a breach or any threat of breach, the Company shall be entitled
to an immediate injunction and restraining order to prevent such breach and/or
threatened breach and/or continued breach by the Executive and/or any and all
persons and/or entities acting for and/or with the Executive, without having to
prove damages. The Executive agrees that no bond shall be required of
the Company and further agrees not to defend any action seeking injunctive or
other equitable relief on the basis that the Company has an adequate remedy at
law in money damages or otherwise. The terms of this Section 4.09
shall not prevent the Company from pursuing any other available remedies for any
breach or threatened breach hereof including, but not limited to, the recovery
of damages from the Executive or specific performance. In addition to
any other available remedies, the Company may require the Executive to account
for and pay over to the Company all compensation, profits, accruals, increments
or other benefits derived or received by the Executive as a result of any
transaction constituting a breach of any provision of
Section 4.00. The Company may set off any amounts finally
determined by a court of competent jurisdiction to be due under this section
against any amount which may be owed to the Executive under this
Agreement. The Parties agree that any action for breach of any of the
provisions of Section 4.00 and/or injunctive relief shall be venued in the
Court of Common Pleas, Franklin County, Ohio.
4.10 Return of Company
Property. Upon termination of employment, the Executive agrees
to promptly return to the Company all property belonging to the Group or any
Group Member.
4.11 Effect of
Termination. The provisions of Section 4.00 shall survive any
termination of this Agreement, and the existence of any claim or cause of action
by the Executive against the Company, whether predicated on this Agreement or
otherwise, shall not constitute a defense to the enforcement by the Company of
the covenants and agreements of this Section 4.00; provided, however, that this
Section 4.11 shall not, in and of itself, preclude the Executive from
defending himself against the enforceability of the covenants and agreements of
Section 4.00.
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5.00 Termination
and Related Benefits
This
Agreement will terminate upon the occurrence of any of the events described in
this section.
5.01 Rules of General
Application. The following rules apply generally to the
implementation of Section 5.00:
[1] Method of
Payment. The Company, at its option, may elect to pay, as a
lump sum, any installment payments due under Section 5.00. If the
Company decides to accelerate payment of any installment obligation due under
Section 5.00, the amount paid will be reduced to reflect the value of the
accelerated payment. This reduction will be based on the rate paid
under 90-day U.S. Treasury Bills issued on the first issue date after this
Agreement terminates.
[2] Application of Pro
Rata. Any pro rata share required to be paid under
Section 5.00 will be based on the number of days between the first day of
the fiscal year during which the Executive terminates employment and the date
that the Executive terminates employment divided by the number of days in the
fiscal year during which the Executive terminates employment.
5.02 Termination Due to Executive’s
Death. This Agreement will terminate automatically on the date
the Executive dies. As of that date, and subject to
Subsection 5.04[6], the Company will make the following payments to the
person the Executive designates on the attached Beneficiary designation
form.
[1] Base Salary. The
unpaid Base Salary the Executive earned to the date of termination.
[2] Bonus. The pro rata
share of any Bonus that would have been paid to the Executive had the Executive
not died. The pro rata share shall be determined after the close of
the fiscal year in which the termination because of death occurs and paid when
other eligible executives are paid a Bonus.
[3] Other. Any rights
accruing to the Executive under any employee benefit plan, fund or program
maintained by the Company will be distributed or made available as required by
the terms of the plan, fund or program or as required by law.
5.03 Termination Due to Executive’s
Disability. The Company may terminate this Agreement after
ascertaining that the Executive is Disabled (as defined below - “Disability”) by
delivering to the Executive a written notice of termination for Disability that
includes the date termination for Disability is to be effective. If
all requirements of this Agreement are met (including those imposed under
Section 7.00), the Company will make the following payments to the
Executive:
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[1] Base Salary. The
unpaid Base Salary the Executive earned to the date of termination.
[2] Bonus. The pro rata
share of any Bonus that would have been paid to the Executive had the Executive
not become Disabled. The pro rata share shall be determined after the
close of the fiscal year in which the termination for Disability occurs and paid
when other eligible executives are paid a Bonus.
[3] Other. Any rights
accruing to the Executive under any employee benefit plan, fund or program
maintained by the Company will be distributed or made available as required by
the terms of the plan, fund or program or as required by law.
[4] Definition of
Disability. For these purposes, “Disability” means that, for
more than six consecutive months, the Executive is unable, with a reasonable
accommodation, to perform the duties described in Section 4.01 on a
full-time basis due to a physical or mental disability or
infirmity.
5.04 Termination for
Cause. The Company may terminate the Executive’s employment
for Cause (as defined below - “Cause”) by delivering to the Executive a written
notice describing the basis for this termination and the date the termination
for Cause is to be effective. If the Executive is terminated for
Cause and if all requirements of this Agreement are met, the Company will make
the following payments to the Executive:
[1] Base Salary. The
unpaid Base Salary the Executive earned to the date of termination.
[2] Other. Any rights
accruing to the Executive under any employee benefit plan, fund or program
maintained by the Company will be distributed or made available as required by
the terms of the plan, fund or program or as required by law.
[3] Definition of
Cause. For these purposes, Cause means the Executive’s [a] failure to comply
with Company’s policies and procedures, but only if [i] before issuing the
notice of termination for Cause, the Company makes a written demand upon the
Executive for compliance and specifically describes the basis for this demand
and [ii] if the failure is one that can be cured, the Executive does not comply
within 10 days after receiving the demand; [b] willful or illegal
misconduct or grossly negligent conduct that is injurious to the Company
monetarily or otherwise; [c] violation of laws or
regulations governing the Company or violation of the Company’s code of ethics;
[d] breach of any
fiduciary duty owed to the Company; [e] misrepresentation or
dishonesty which the Company determines has had or is likely to have a material
adverse effect upon the Company; [f] breach of any
provision of Section 4.00 of this Agreement; [g] involvement in any
act of moral turpitude that has an injurious effect on the Company or its
reputation; or [h] breach of the terms
of any non-solicitation or confidentiality clauses contained in an employment
agreement(s) with a former employer.
[4] Subsequent
Information. The terms of Section 5.04 will apply if, after
the Executive terminates under any other provision of Section 5.00, the Company
learns of an event that, had it been known before the Executive terminated
employment, would have justified a termination for Cause. In this
case, the Company will be entitled to recover (and the Executive agrees to
repay) any amounts (other than legally protected benefits) that the Executive
received under any other provision of Section 5.00 reduced by the amount the
Executive is entitled to receive under Section 5.04.
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5.05 Voluntary Termination by
Executive. The Executive may voluntarily terminate employment
with the Company at any time, in which case the Company will make the following
payments to the Executive if all requirements of this Agreement are
met:
[1] Base Salary. The
unpaid Base Salary the Executive earned to the date of termination.
[2] Other. Any rights
accruing to the Executive under any employee benefit plan, fund or program
maintained by the Company will be distributed or made available as required by
the terms of the plan, fund or program or as required by law.
5.06 Involuntary Termination Without
Cause. The Company may terminate the Executive’s employment at
any time Without Cause (as defined below) by delivering to the Executive a
written notice specifying the date termination is to be effective. If
all requirements of this Agreement are met (including those imposed under
Section 7.00), the Company will make the following payments to the
Executive as of the effective date of termination Without Cause:
[1] Base Salary. For 12
months beginning on the date of termination Without Cause, the Company will
continue to pay the Executive’s Base Salary at the rate in effect on the date of
termination Without Cause.
[2] Other. Any rights
accruing to the Executive under any employee benefit plan, fund or program
maintained by the Company will be distributed or made available as required by
the terms of the plan, fund or program or as required by law.
[3] Definition of Without
Cause. For purposes of this Agreement, “Without Cause” means
termination of the Executive’s employment by the Company for any reason other
than those set forth in Sections 5.02, 5.03, 5.04 or 5.05.
5.07 Termination After Change of
Control.
[1] Termination of
Employment. If there is a Change of Control (as defined
herein) or within two (2) years following a Change of Control (as defined
herein), the Company terminates the Executive’s employment Without Cause, the
provisions of this Section 5.07 shall be applicable, instead of the
provisions of Section 5.06. To the extent that the provisions of
this Section 5.07 are applicable, the Executive shall be entitled to the
following payments and benefits:
[a] Base Salary. A
single lump sum payment equal to two (2) times the Executive’s Base Salary at
the rate in effect on the date of termination.
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[b] Bonus. A single
lump sum payment equal to two (2) times the Executive’s Stretch Bonus in effect
under the Bonus Program for the year in which the Executive’s employment is
terminated.
[c] Health Care. The
Company will reimburse the Executive for the cost of continuing health coverage
under COBRA for a period of no more than 12 months following the date of
termination, less the amount the Executive is expected to pay as a regular
employee premium for such coverage. Such reimbursements will cease if
the Executive becomes eligible for similar coverage under another benefit
plan.
[d] Other. Any rights
accruing to the Executive under any employee benefit plan, fund or program
maintained by the Company arising from either a Change of Control or termination
of employment will be distributed or made available as required by the terms of
the plan, fund or program or as required by law.
[2] Definition of Change of
Control. For purposes of this Agreement, the term “Change of
Control” means [a] any person or group
[as defined for purposes of Section 13(d) of the Securities Exchange Act of
1934] that becomes the beneficial owner of, or has the right to acquire (by
contract, option, warrant, conversion of convertible securities or otherwise),
20% or more of the outstanding equity securities of Big Lots, Inc. (“BLI”)
entitled to vote for the election of directors; [b] a majority of the
Board of Directors of BLI is replaced within any period of two years or less by
directors not nominated and approved by a majority of the directors of BLI in
office at the beginning of such period (or their successors so nominated and
approved), or a majority of the Board of Directors of BLI at any date consists
of persons not so nominated and approved; [c] the stockholders of
BLI approve an agreement to reorganize, merge or consolidate with another
corporation (other than Big Lots Stores, Inc. or an affiliate); [d] the stockholders of
BLI adopt a plan or approve an agreement to sell or otherwise dispose of all or
substantially all of BLI’s assets (including without limitation, a plan of
liquidation or dissolution), in a single transaction or series of related
transactions. The effective date of any such Change of Control shall
be the date upon which the last event occurs or last action is taken such that
the definition of such Change of Control (as set forth above) has been
met. For purposes of this Agreement, the term “affiliate” shall
mean: [i] any person or entity
qualified as part of an affiliated group which includes BLI pursuant to Section
1504 of the Internal Revenue Code of 1986, as amended (the “Code”); or [ii] any person or entity
qualified as part of a parent-subsidiary group of trades and businesses under
common control within the meaning of Treasury Regulation Section
1.414(c)(2)(b). Determination of affiliate shall be tested as of the
date immediately prior to any event constituting a Change of
Control. The other provisions of this Section 5.07
notwithstanding, the term “Change of Control” shall not mean any transaction,
merger, consolidation or reorganization in which BLI exchanges or offers to
exchange newly issued or treasury shares in an amount less than 50% of the
then-outstanding equity securities of BLI entitled to vote for the election of
directors, for 51% or more of the outstanding equity securities entitled to vote
for the election of at least the majority of the directors of a corporation
other than BLI or an affiliate thereof (the “Acquired Corporation”), or for all
or substantially all of the assets of the Acquired Corporation.
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[3] Treatment of
Taxes. If payments under this Agreement, when combined with
payments and benefits under all other plans and programs maintained by the
Company, constitute “excess” parachute payments as defined in
Section 280G(b) of the Code, the Company, subject to
Subsection 5.07[4], will either:
[a] Reimburse
the Executive for the amount of any excise tax due under Code §4999, if this
procedure provides the Executive with an after-tax amount that is larger than
the after-tax amount produced under Subsection 5.07[3][b]; or
[b] Reduce
the Executive’s benefits under this Agreement so that the Executive’s total
“parachute payment” as defined in Code §280G(b)(2)(A) under this and all other
agreements will be $1.00 less than the amount that would be an “excess”
parachute payment if this procedure provides the Executive with an after-tax
amount that is larger than the after-tax amount produced under
Subsection 5.07[3][a].
This
comparison will be made as of the date of the corporate event generating the
“parachute payments” although any reimbursement provided under
Subsection 5.07[3][a] will be made when the parachute payment is actually
made or distributed.
Within 10
days of the date the Company determines that Subsection 5.07[3][b] should
be applied, the Company will apprise the Executive of the amount of the
reduction (“Notice of Reduction”). Within 10 days of receiving that
information, the Executive may specify how (and against which benefit or payment
source) the reduction is to be applied (“Notice of Allocation”). The
Company will be required to implement these directions within 10 days of
receiving the Notice of Allocation. If the Company has not received a
Notice of Allocation from the Executive within 10 days of the date of the Notice
of Reduction or if the allocation provided in the Notice of Allocation is not
sufficient to fully implement Subsection 5.07[3][b], the Company will apply
Subsection 5.07[3][b] proportionately based on the amounts otherwise
payable under this Agreement or, if a Notice of Allocation has been returned
that does not sufficiently implement Subsection 5.07[3][b], on the basis of
the reductions specified in the Notice of Allocation.
[4] Effect of Subsequent Tax
Claim. The Company will establish procedures that will apply
to any inquiries regarding the treatment of tax payments under this
Section 5.07. Within 30 days following the termination of the
Executive’s employment under Section 5.07, the Company will provide the
Executive with a copy of such procedures.
6.00 Notice
6.01 How Given. Any
notice permitted or required to be given under this Agreement must be given in
writing and delivered in person or by registered, U.S. mail, return receipt
requested, postage prepaid; or through Federal Express, UPS, DHL or any other
reputable professional delivery service that maintains a confirmation of
delivery system. Any delivery must be addressed to the Company’s Vice
President and General Counsel with a copy to the Company’s Chief Executive
Officer at the Company’s then-current corporate offices and to the Executive at
the Executive’s address as contained in the Executive’s personnel
file.
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6.02 Effective Date. Any
notice permitted or required to be given under this Agreement will be effective
on the date it is delivered, in the event of personal delivery, or on the date
its receipt is acknowledged, in the event of delivery by registered mail or
through a professional delivery service described in
Section 6.01.
7.00 Execution
of Release
The
Executive agrees that as a condition of receiving any post-termination benefit
as set forth in Section 5.00 except for earned but unpaid Base Salary to
the date of termination, along with any accrued rights the Executive has under
any employee benefit plan of the Company, he must execute a comprehensive
release in the form as may be determined from time to time by the Company in its
sole discretion. Generally, the release will require the Executive
and the Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, legatees and assigns
to release and forever discharge the Company (and all Group Members) and its
executives, officers, directors, agents, attorneys, successors and assigns from
any and all claims, suits and/or causes of action that grow out of or are in any
way related to the Executive’s recruitment to or employment with the Company,
other than any claim that the Company has breached this
Agreement. This release will include, but not be limited to, any
claim that the Company violated the Employee Retirement Income Security Act of
1974; the Age Discrimination in Employment Act; the Older Worker’s Benefit
Protection Act; the Americans with Disabilities Act; Title VII of the Civil
Rights Act of 1964 (as amended); the Family and Medical Leave Act; any state,
federal law or local ordinance prohibiting discrimination, harassment or
retaliation in employment; any claim for wrongful discharge in violation of
public policy, claims of promissory estoppel or detrimental reliance,
defamation, intentional infliction of emotional distress; or the public policy
of any state; or any federal, state or local law. Upon termination,
the Executive will be presented with a release and if the Executive fails to
execute the release, the Executive agrees to forego any payment from the Company
other than payments as if the Executive had terminated employment voluntarily
under Section 5.05. The Executive acknowledges that the
Executive is an experienced senior executive knowledgeable about the claims that
might arise in the course of employment with the Company and knowingly agrees
that the payments upon termination (except those payable in accordance with
Sections 5.02, 5.04 and 5.05) provided for in this Agreement are satisfactory
additional consideration for the release of all possible claims.
8.00 Insurance
To the
extent permitted by law and its organizational documents, the Company will
include the Executive under any liability insurance policy the Company maintains
for employees of comparable status. The level of coverage will be at
least as favorable to the Executive (in amount and each other material respect)
as the coverage of other employees of comparable status. This
obligation to provide insurance for the Executive will survive termination of
this Agreement with respect to proceedings or threatened proceedings based on
acts or omissions occurring during the Executive’s employment with the Company
or with any Group Member.
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9.00 Arbitration
9.01 Acknowledgement of
Arbitration. Unless stated otherwise in this Agreement, the
Parties agree that arbitration is the sole and exclusive remedy for each of them
to resolve and redress any dispute, claim or controversy involving the
interpretation of this Agreement or the terms, conditions or termination of this
Agreement or the terms, conditions or termination of the Executive’s employment
with the Company, including any claims for any tort, breach of contract,
violation of public policy or discrimination, whether such claim arises under
federal or state law.
9.02 Scope of
Arbitration. The Executive expressly understands and agrees
that claims subject to arbitration under this section include asserted
violations of the Employee Retirement Income Security Act of 1974; the Age
Discrimination in Employment Act; the Older Worker’s Benefit Protection Act; the
Americans with Disabilities Act; Title VII of the Civil Rights Act of 1964 (as
amended); the Family and Medical Leave Act; any law prohibiting discrimination,
harassment or retaliation in employment; any claim of promissory estoppel or
detrimental reliance, defamation, intentional infliction of emotional distress;
or the public policy of any state, or any federal, state or local
law.
9.03 Effect of
Arbitration. The Parties intend that any arbitration award
relating to any matter described in Section 9.00 will be final and binding on
them and that a judgment on the award may be entered in any court of competent
jurisdiction, and enforcement may be had according to the terms of that
award. This section will survive the termination or expiration of
this Agreement.
9.04 Location of
Arbitration. Arbitration will be held in Columbus, Ohio, and
will be conducted by a retired federal judge or other qualified
arbitrator. The arbitrator will be mutually agreed upon by the
Parties and the arbitration will be conducted in accordance with the National
Rules for the Resolution of Employment Disputes of the American Arbitration
Association. The Parties will have the right to conduct discovery
pursuant to the Federal Rules of Civil Procedure; provided, however, that the
arbitrator will have the authority to establish an expedited discovery schedule
and cutoff and to resolve any discovery disputes. The arbitrator will
have no jurisdiction or authority to change any provision of this Agreement by
alterations of, additions to or subtractions from the terms of this
Agreement. The arbitrator’s sole authority will be to interpret or
apply any provision(s) of this Agreement or any public law alleged to have been
violated. The arbitrator has the authority to award damages and such
other relief as expressly provided by law.
9.05 Time for Initiating
Arbitration. Any claim or controversy not sought to be
submitted to arbitration, in writing, within 60 days of the date the Party
asserting the claim knew, or through reasonable diligence should have known, of
the facts giving rise to that Party’s claim, will be deemed waived and the Party
asserting the claim will have no further right to seek arbitration or recovery
with respect to that claim or controversy. Both Parties agree to
strictly comply with the time limitation specified in Section
9.00. For purposes of this section, a claim or controversy is sought
to be submitted to arbitration on the date the complaining Party gives written
notice to the other that [1] an issue has arisen
or is likely to arise that, unless resolved otherwise, may be resolved through
arbitration under Section 9.00 and [2] unless the issue is
resolved otherwise, the complaining Party intends to submit the matter to
arbitration under the terms of Section 9.00.
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9.06 Costs of Arbitration and Attorney’s
Fees. The Company will bear the arbitrator’s fee and other
costs associated with any arbitration, unless the arbitrator, acting under
Federal Rule of Civil Procedure 54(d)(1), elects to award these fees to the
Company. Attorney’s fees may be awarded to the prevailing party if
expressly authorized by statute, or otherwise each party shall bear its own
attorney’s fees and costs.
9.07 Arbitration Exclusive
Remedy. The Parties acknowledge that, because arbitration is
the exclusive remedy for resolving issues arising under this Agreement, neither
Party may resort to any federal, state or local court or administrative agency
concerning breaches of this Agreement or any other matter subject to arbitration
under Section 9.00, except as otherwise provided in this Agreement, and that the
decision of the arbitrator will be a complete defense to any suit, action or
proceeding instituted in any federal, state or local court before any
administrative agency with respect to any arbitrable claim or
controversy.
9.08 Waiver of Jury. The
Executive and the Company each waive the right to have a claim or dispute with
one another decided in a judicial forum or by a jury, except as otherwise
provided in this Agreement.
10.00 General
Provisions
10.01 Representation of
Executive. The Executive represents and warrants that the
Executive is not under any contractual or legal restraint that prevents or
prohibits the Executive from entering into this Agreement or performing the
duties and obligations described in this Agreement.
10.02 Modification or Waiver; Entire
Agreement. No provision of this Agreement may be modified or
waived except in a document signed by the Executive and the Company’s Chief
Executive Officer or other person designated by the Company’s Board of
Directors. This Agreement, and any attachments referenced in the
Agreement, constitute the entire agreement between the Parties regarding the
employment relationship described in this Agreement, and any other agreements
are terminated and of no further force or legal effect. No agreements
or representations, oral or otherwise, with respect to the Executive’s
employment relationship with the Company have been made or relied upon by either
Party which are not set forth expressly in this Agreement.
10.03 Governing Law;
Severability. This Agreement is intended to be performed in
accordance with, and only to the extent permitted by, all applicable laws,
ordinances, rules and regulations. If any provision of this
Agreement, or the application of any provision of this Agreement to any person
or circumstance, is, for any reason and to any extent, held invalid or
unenforceable, such invalidity and unenforceability will not affect the
remaining provisions of this Agreement of its application to other persons or
circumstances, all of which will be enforced to the greatest extent permitted by
law and the Executive and the Company agree that the arbitrator (or judge) is
authorized to reform the invalid or enforceable provision [1] to the extent needed
to avoid the invalidity or unenforceability and [2] in a manner that is
as similar as possible to the intent (as described in this
Agreement). The validity, construction and interpretation of this
Agreement and the rights and duties of the Parties will be governed by the laws
of the State of Ohio, without reference to the Ohio choice of law
rules.
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10.04 No Waiver. Except
as otherwise provided in Section 9.05, failure to insist upon strict compliance
with any term of this Agreement will not be considered a waiver of any such
term.
10.05 Withholding. All
payments made to the Executive under this Agreement will be reduced by any
amount:
[1]
That the Company is required to withhold in advance payment of the Executive’s
federal, state and local income, wage and employment tax liability;
and
[2] To
the extent allowed by law, that the Executive owes (or, after employment is
deemed to owe) to the Company.
However,
application of Subsection 10.05[2] will not extinguish the Company’s right
to seek additional amounts from the Executive (or to pursue other appropriate
remedies) to the extent that the amount that may be recovered by application of
Subsection 10.05[2] does not fully discharge the amount the Executive owes
to the Company and does not preclude the Company from proceeding directly
against the Executive without first exhausting its right of recovery under
Subsection 10.05[2].
10.06 Survival. Subject
to the terms of the Executive’s Beneficiary Designation form, the Parties agree
that the covenants and promises set forth in this Agreement will survive the
termination of this Agreement and continue in full force and
effect.
10.07 Miscellaneous.
[1] The
Executive may not assign any right or interest to, or in, any payments payable
under this Agreement; provided, however, that this prohibition does not preclude
the Executive from designating in writing one or more beneficiaries to receive
any amount that may be payable after the Executive’s death and does not preclude
the legal representative of the Executive’s estate from assigning any right
under this Agreement to the person or persons entitled to it.
[2] This
Agreement will be binding upon and will inure to the benefit of the Executive,
the Executive’s heirs and legal representatives and the Company and its
successors.
[3] The
headings in this Agreement are inserted for convenience of reference only and
will not be a part of or control or affect the meaning of any provision of the
Agreement.
10.08 Successors to
Company. This Agreement may and will be assigned or
transferred to, and will be binding upon and will inure to the benefit of, any
successor of the Company, and any successor will be substituted for the Company
under the terms of this Agreement. As used in this Agreement, the
term “successor” means any person, firm, corporation or business entity which at
any time, whether by merger, purchase or otherwise, acquires all or essentially
all of the assets of the business of the Company. Notwithstanding any
assignment, the Company will remain, with any successor, jointly and severally
liable for all its obligations under this Agreement.
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IN
WITNESS WHEREOF, the Parties have duly executed and delivered this Agreement,
which includes an arbitration provision, and consists of 19 pages.
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BIG
LOTS STORES, INC.
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By:
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/s/ Brad A. Waite
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Signed: Nov.
9, 2004
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ROBERT
S. SEGAL
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/s/ Robert S.
Segal
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Signed: Nov.
8, 2004
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