Exhibit 10.3
CHANGE IN CONTROL RETENTION BONUS PLAN
April 27, 2006
To:      [Executive Officer Name & Title]
As previously reported, Michaels Stores, Inc. (the “Company”) is currently
exploring strategic alternatives, including the sale of the Company, to enhance
the value to its stakeholders. In your role as a key employee of the Company and
to motivate your continued employment with the Company in good standing, the
Board of Directors of the Company has approved a one-time Change in Control
bonus to you in the amount of $125,000 (“Bonus”) in connection with your
continued dedication to the Company during its ongoing review of strategic
alternatives. To receive your Bonus, you must be actively employed by the
Company at the time of the Change in Control (as defined in the Michaels Stores,
Inc. 2005 Incentive Compensation Plan). Payment of the Bonus will be made by the
Company on the one year anniversary of the Change in Control. If you are
terminated as a result of the Change in Control prior to the one year
anniversary, you will be paid a lump sum payment in the amount of your Bonus
within 10 business days of your termination date, provided that you were
employed by the Company on the date of the Change in Control.
This Bonus should be viewed as an indication of the Company’s confidence in and
appreciation of your abilities, and as an additional form of compensation to
meet a special need. The Bonus is not a guarantee of continued employment or a
permanent or recurring element of your compensation, nor will it impact any
other element of your compensation for which you may otherwise be eligible.
The terms of this Bonus are to be kept strictly confidential, until such time as
these terms are made public by the Company when required by applicable law.
Nothing shall prevent the Company from disclosing the terms of this Bonus to a
potential purchaser of the Company or otherwise.
Your rights under this Bonus shall be personal and are not subject to any
additional conditions or requirements. You may rely on the terms set forth in
this Bonus Plan, and the Company may not adversely amend or modify your rights,
or terminate your Bonus, without your prior written consent. Upon a Change in
Control, the Company shall administer the terms of your Bonus in the ordinary
course of its business, and any successor to the business or the assets of the
Company shall be bound by the terms of this Bonus Plan to the same extent that
the Company would have otherwise been obligated to you. In the event that any
successor would not be required to be bound by the terms of this Bonus Plan
under applicable law, the Company shall use its best efforts to require such
successor to expressly and unconditionally assume and agree to perform the
Company’s obligations under this Bonus Plan, in the same manner and to the same
extent that the Company would have been required to perform such obligations if
no such succession would have taken place.
Sincerely,

     
-s- Jeffrey N. Boyer [d36685d3668501.gif]
  -s- Gregory A. Sandfort [d36685d3668502.gif]
By:    Jeffrey N. Boyer
  By:     Gregory A. Sandfort
           President and Chief Financial Officer
             President and Chief Operating Officer