Pier 1 2008 Annual Report Download - page 116

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such fiscal year as well as in prior fiscal years, in accordance with SFAS 123R. The amounts shown
exclude the impact of estimated forfeitures related to service based vesting conditions. For time based
restricted stock awards, fair value is calculated using the closing price of Pier 1 Imports’ common stock
on the date of grant. No amount was expensed in fiscal 2008 or fiscal 2007 for the performance-based
restricted stock awards granted in fiscal 2007 because it is unlikely that the three-year cumulative EBITDA
performance goal of $331,000,000 will be met. These amounts reflect Pier 1 Imports’ accounting expense
for these awards, and do not necessarily correspond to the actual value that will be recognized by the
named executive officer.
(3) This column represents the dollar amount recognized for financial statement reporting purposes for each
fiscal year for the fair value of stock options granted in such fiscal year as well as in prior fiscal years, in
accordance with SFAS 123R. The amounts shown exclude the impact of estimated forfeitures related to
service based vesting conditions. For additional information on the valuation assumptions with respect to
the fiscal 2008 grants and grants made prior to fiscal 2008, refer to note #10 to the Pier 1 Imports, Inc.
consolidated financial statements in Pier 1 Imports’ Annual Report on Form 10-K for the fiscal year ended
March 1, 2008 (the “2008 Form 10-K”). These amounts reflect Pier 1 Imports’ accounting expense for
these awards, and do not necessarily correspond to the actual value that will be recognized by the named
executive officers.
Option 1 granted to Mr. Smith to purchase 1,000,000 shares of Pier 1 Imports’ common stock on Febru-
ary 19, 2007 vested on February 19, 2008. The grant is being expensed over two years at $2.88 per share.
If Mr. Smith fails to be employed with Pier 1 Imports between February 19, 2008 and February 28, 2009
and Mr. Smith ends such employment without good reason (as defined in Mr. Smith’s employment agree-
ment), then he forfeits 50% of the option. In accordance with SFAS 123R, no grant date fair value had
been determined as of March 1, 2008 for Mr. Smith’s Option 2 performance-based options to purchase
2,000,000 shares since performance targets related to these options had not as of that date been set by the
board of directors.
(4) This column represents the sum of the change in pension value and above market earnings on non-
qualified deferred compensation earnings for each of the named executive officers. During fiscal 2007,
Mr. Smith did not participate in a Pier 1 Imports defined benefit plan.
The change in pension value was:
Name Fiscal 2008 Fiscal 2007
Alexander W. Smith ............................................. $3,883,868 N/A
Charles H. Turner ............................................... $ 385,629 $107,259
Gregory S. Humenesky ........................................... $ 11,799 N/A
Jay R. Jacobs .................................................. $ 360,718 $ 8,877
Phil E. Schneider ............................................... $ 125,005 $ 64,024
David A. Walker................................................ $ 210,351 $173,593
See the Pension Benefits Table below for additional information.
During fiscal 2008 and 2007, Mr. Smith did not participate in a non-qualified deferred compensation plan.
The above market earnings on the non-qualified deferred compensation plan(s) in which the below named
executive officers participated were:
Name Fiscal 2008 Fiscal 2007
Charles H. Turner ................................................ $ 369 $ 518
Gregory S. Humenesky . . . ......................................... $ 235 N/A
Jay R. Jacobs ................................................... $2,672 $1,049
Phil E. Schneider ................................................ $3,023 $ 970
David A. Walker ................................................. $2,542 $ 686
Above market earnings represent the difference between 120% of the long-term applicable Federal Rate at
the time the rate for the plan was selected and the 7.03% and 7.05% annual interest credited in calendar
35