Pier 1 2007 Annual Report Download - page 122

(4) Final payouts to be paid in fiscal 2008 are $5,899,262 to Mr. Girouard and $382,692 to Mr. Weatherly.
The amounts include interest accrued at the time of payment of $203,230 and $13,320, respectively.
Mr. Girouard and Mr. Weatherly were fully vested in Pier 1’s Supplemental Executive Retirement Plan.
This plan is described generally in the Compensation Discussion and Analysis above. As in the case for
Mr. Weatherly, if a participant has at least 10 years of plan participation and retires from Pier 1 at or after
age 55 and before age 65, his calculated benefit prior to adjustment for Social Security benefits is reduced by
5% for each year his retirement precedes age 65. As in the case for Mr. Girouard, if a participant retires from
Pier 1 after age 65, the percentage of his pre-age 65 highest average annual salary and bonus used to calculate
his benefit is increased above 50% by 5% for each year of service after age 65, to a total not greater than
65%.
Pier 1 has established a trust for the purpose of setting aside funds to be used to settle certain obligations
under Pier 1’s Supplemental Executive Retirement Plan. The trust assets are consolidated in Pier 1’s financial
statements and consist of interest yielding investments aggregating $6,123,000 at March 3, 2007. These
investments are restricted and may only be used to satisfy retirement obligations under the indicated retirement
plan. Any future contributions to the trust will be made at the discretion of the board. During fiscal 2007,
investments from the trust were redeemed to settle Supplemental Executive Retirement Plan payouts to
Mr. Girouard and Mr. Weatherly. It is anticipated that the remaining fiscal 2008 payouts indicated in footnote 4
above will also be settled by redeeming investments from the trust.
Messrs. Jacobs, Schneider, Turner and Walker participate in Pier 1’s Supplemental Retirement Plan.
Benefits under the plan for each participant are prorated for years of credited service with Pier 1 of less than
20 years. In addition, each participant becomes vested in that benefit based on years of plan participation
under the following schedule:
Years of Plan Participation Vesting Percentage
Less than 1 ..................................................... 0
1 but less than 2.................................................. 10
2 but less than 3.................................................. 20
3 but less than 4.................................................. 30
4 but less than 5.................................................. 40
5 but less than 6.................................................. 50
6 but less than 7.................................................. 60
7 but less than 8.................................................. 70
8 but less than 9.................................................. 80
9 but less than 10 ................................................. 90
10 or more ...................................................... 100
Vesting is accelerated to 100% upon an early retirement, normal retirement, termination of employment
in certain circumstances as a result of a change in control of Pier 1, or death or disability of the participant.
The years of plan participation for Mr. Jacobs are 11 years, for Mr. Schneider are 11 years, for Mr. Turner are
11 years, and for Mr. Walker are 6 years.
None of the named executive officers qualifies for normal retirement under the plan, which requires a
participant’s attainment of age 65. A participant qualifies for early retirement if the participant has at least
10 years of plan participation and retires at or after age 55 and before age 65. If a participant retires from Pier
1 after age 55 but before age 65, the calculated benefit prior to adjustment for Social Security benefits is
reduced by 5% for each year that retirement precedes age 65. Only Mr. Schneider, age 55, has the required
age attainment and years of plan participation to be eligible for early retirement.
Refer to note #10 to the Pier 1 Imports, Inc. consolidated financial statements in the 2007 Form 10-K for
a discussion of the valuation method and material assumptions applied in quantifying the present value of the
current accrued benefit for both plans shown in the Pension Benefits Table above.
35