Pier 1 2016 Annual Report Download - page 109

COMPENSATION
Base Salary
No across-the-board increases
Generally, Pier 1 Imports targets base salary at the 50th percentile of its peer group for comparable skills. The aspects of individual
performance that may be considered in the determination of each executive’s base salary include the individual’s contribution to
achieving operating goals, expense control and reduction, profitability and performance as compared to planned results. Pier 1 Imports
recognizes individual experience, skill, level of responsibility and performance over time to set base salary levels.
In fiscal 2016, Pier 1 Imports’ chief executive officer and human resources compensation group once again recommended to the
compensation committee only targeted increases to certain executives and no “across-the-board” base salary increases for Pier 1
Imports’ NEOs. The compensation committee supported management’s recommendation and approved targeted increases in base
salary for three of the NEOs, as shown in Table 2 below based upon the considerations described in the preceding paragraph.
Mr. Smith’s base salary is described below under the caption “Chief Executive Officer Compensation,” and no changes were made for
fiscal 2016 or 2017. Mr. Smith’s base salary has not increased since March 2013.
Table 2
NAMED EXECUTIVE OFFICER
FISCAL 2015
BASE SALARY
FISCAL 2016
BASE SALARY
PERCENTAGE
INCREASE
Alexander W. Smith $1,250,000 $1,250,000 0%
Jeffrey N. Boyer – $ 500,000 —
Laura A. Coffey* $ 325,000 $ 325,000 0%
Michael R. Benkel $ 360,000 $ 360,000 0%
Catherine David $ 430,000 $ 450,000 4.7%
EricW. Hunter $ 425,000 $ 435,000 2.4%
Sharon M. Leite $ 400,000 $ 425,000 6.3%
* Ms. Coffey was appointed executive vice president and interim chief financial officer on February 10, 2015 and served in that role until Mr. Boyer’s appointment on July 27, 2015. The fiscal 2015 salary
shown for her is the amount effective upon her appointment.
Short-Term Incentive
No short-term incentives paid for fiscal 2016
Pier 1 Imports’ short-term incentive program for its executives in fiscal 2016 provided an opportunity to receive a cash award. All NEOs
were in the same short-term incentive program in fiscal 2016. Eighty percent of the incentive was based upon achievement of the Profit
Goal. The actual amount of the Profit Goal that is achieved for the fiscal year is referred to as the “Realized Profit.” Profit Goal was selected
as a performance measure because it focuses on factors that an individual participant’s actions can affect and because it more closely
reflects cash being generated by Pier 1 Imports’ ongoing core operations. It largely eliminates the effects of financing and tax decisions as
well as unusual charges. Use of the short-term incentive Profit Goal as a measure of Pier 1 Imports’ financial and operational performance is
designed to lead to increased profitability over time. Due to increased focus on its e-Commerce initiatives, Pier 1 Imports implemented an
additional metric for the fiscal 2016 short-term incentive program aimed at growing e-Commerce sales. As a result of this focus, twenty
percent of the fiscal 2016 short-term incentive award was based on a performance measure of Pier 1 Imports’ e-Commerce sales. These
incentives and their respective weights were evaluated by the compensation committee and approved as the short-term incentive program
for fiscal 2016. The quantified performance measures at threshold, target and maximum amounts are shown in Table 3 below. The fiscal
2016 short-term incentive awards were governed by the Pier 1 Imports, Inc. 2006 Stock Incentive Plan.
Table 3
FISCAL 2016 ANNUAL SHORT-TERM INCENTIVE OPPORTUNITY
WEIGHTING COMPONENT THRESHOLD TARGET MAXIMUM
80% Profit Goal $174,500,000 $205,500,000 $246,500,000
20% e-Commerce Sales $276,500,000 $325,500,000 $390,500,000
PIER 1 IMPORTS, INC. | 2016 Proxy Statement 27