Pier 1 2010 Annual Report Download - page 112

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The board of directors unanimously recommends a vote “FOR” the election of each of the above-named
nominees as a director.
PROPOSAL NO. 2 – Proposal to Approve an Amendment of the Pier 1 Imports, Inc. Stock Purchase Plan to
Authorize an Additional 3,500,000 Shares of Pier 1 Imports’ Common Stock to the Plan and to Extend the
Term of the Plan for Five Years
The board of directors on March 26, 2010 unanimously approved an amendment of the Pier 1 Imports, Inc.
Stock Purchase Plan, subject to shareholder approval, authorizing an additional 3,500,000 shares to the plan and
extending the term of the plan for five years.
General
Pier 1 Imports established the Stock Purchase Plan to provide all eligible employees and non-employee
directors an opportunity to acquire an ownership interest in Pier 1 Imports and, as a result, provide participants with
a more direct concern about our welfare and align interest with our other shareholders. The plan provides a
voluntary method of acquiring shares of Pier 1 Imports’ common stock in convenient installments by payroll and
other compensation deductions, supplemented by matching contributions from Pier 1 Imports.
The plan has been in effect since 1980. The plan is administered by the compensation committee. A
restatement of the plan as amended was approved by our shareholders in 2008. As restated, the term of the plan was
five years and the number of shares issuable under the plan was 2,541,025 shares. Pier 1 Imports’ board of directors
on January 22, 2009 approved a suspension of the primary operational aspects of the plan after the last occurrence in
which participant contributions plus Pier 1 Imports’ matching contributions could be used to purchase shares of
common stock within the authorized amount. The suspension became effective March 28, 2009 and covered
participant compensation deductions, Pier 1 Imports’ matching contributions, enrollment of new participants and
purchases of shares of Pier 1 Imports’ common stock by the plan. Upon suspension the plan had 881,923 remaining
authorized shares. Pier 1 Imports’ board of directors on March 26, 2010 approved an amendment of the plan, subject
to shareholder approval, authorizing an additional 3,500,000 shares to the plan and extending the term of the plan
for five years. The plan is described below, and a copy of the amendment is attached to this proxy statement as
Appendix A.
Eligibility
All of our employees who have attained the age of majority of their state or province of residence and have
completed 60 days of employment with Pier 1 Imports, or one of our designated subsidiaries which has adopted the
plan, are eligible to participate in the plan. At March 1, 2009, approximately 15,000 employees were eligible to
participate in the plan, and 1,152 employees were participants in the plan. Members of our board of directors who
are not employees are also eligible to participate in the plan.
Participant Accounts
Pier 1 Imports maintains an account in the name of each participant, deducts funds from each participant’s pay
as elected and authorized by the participant and pays monthly to the plan for each participant’s account the deducted
funds plus Pier 1 Imports’ contribution on the participant’s behalf. The plan allows Pier 1 Imports as the plan
administrator to use the contributed funds to purchase shares of Pier 1 Imports’ common stock either on the open
market or directly from Pier 1 Imports. No open market purchase may be made at a price which is greater than the
fair market value for our common stock on the date of purchase. Pier 1 Imports’ compensation committee has
determined that purchases of shares from our treasury will be based on an average of the NYSE closing prices for
Pier 1 Imports’ common stock on each Friday during the month. Shares purchased are allocated to the accounts of
participants in proportion to the funds received from each respective account. The plan provides that Pier 1 Imports
pay any broker’s commissions or markups on open market purchases made by a broker.
Each participant acquires full and immediate beneficial ownership of all shares and fractional shares allocated
to his or her account. All shares are registered in the name of the plan and remain registered in the plan’s name until
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