Pier 1 2012 Annual Report Download - page 109

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Table 1
Compensation
Component Intended Purpose
Specific Features for Pier 1 Imports
Executives
Targeted Proportion of Total
Direct Compensation
CEO Other NEO’s
Base Salary
To provide a fixed amount
of compensation that is
commensurate with
market conditions for
similar jobs and to aid in
the attraction and
retention of key
executives.
Pier 1 Imports recognizes individual
experience, skill, level of
responsibility and performance over
time to set base pay levels and
generally targets the 50th percentile
or “at market” within the context of
the national retail market.
Changes to base pay may be made
based on individual and company
performance, pay in relation to other
peers and the external labor market,
and increased responsibility.
Depending on the position, base pay
is approximately 18.5% - 42% of
total target compensation for
executive officers and is in
alignment with our philosophy of
putting the majority of pay at risk
based on corporate performance.
18.5%
42.0%
Short-Term
Incentive
To motivate executives to
achieve maximum
quarterly and annual
financial and operational
goals and to reward
executives for their
contributions when those
goals are achieved.
Annual short-term
incentives are also used to
align competitive pay
levels on an annual basis.
Provides alignment of our executive
team’s interests with our short-term
corporate operating objectives.
These annual objectives are tied to
the overall strategic mission and
long-term plan.
Design allows incentive targets for
executive officers to vary by
individual after consideration of
relevant market and peer group
compensation information,
individual job responsibilities and
other relevant information as
appropriate given the needs of the
business.
Designed to focus management on
increasing operating profitability on
a year-over-year basis, with no
payouts in fiscal 2012 unless Pier 1
Imports achieved higher results
when compared to fiscal 2011.
Annual incentive awards help Pier 1
Imports achieve quarterly financial
and operating objectives since a
portion of the total annual incentive
is tied to quarterly financial and
operating results.
18.5%
31.0%
27