Document:

exv10w1

 

Exhibit 10.1

PIER 1

BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

PIER 1

BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

     The Pier 1 Benefit Restoration Plan was established effective as of April 1, 1990, by the
Company. The purpose of the Pier 1 Benefit Restoration Plan is to permit select members of
management and highly compensated employees of the Company to defer current compensation. In
addition, the Company desires and intends by the adoption and maintenance of this Benefit
Restoration Plan to recognize the value to the Company of the past and present services of
employees covered by the Benefit Restoration Plan and to encourage and assure their continued
service to the Company by making more adequate provision for their future retirement security. The
Pier 1 Benefit Restoration Plan was previously amended and restated effective as of December 20,
1991 and was again amended and restated effective as of July 1, 1995. Subsequent to July 1, 1995
the Pier 1 Benefit Restoration Plan was amended six (6) times. Effective as of January 1, 2005,
the portion of the Pier 1 Benefit Restoration Plan which will not be subject to certain new
deferred compensation laws is being separated from the portion which will be subject to such laws,
is hereby renamed the Pier 1 Benefit Restoration Plan I and is hereby amended and restated as
hereinafter set forth in this instrument.

i

 

PIER 1

BENEFIT RESTORATION PLAN I

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	ARTICLE	 	 	 	PAGE	 
	 
	 	 	 	 	 	 
	I.
	 	Title and Effective Date	 	 	1	 
	 
	 	 	 	 	 	 
	II.
	 	Definitions and Construction of the Plan Document	 	 	1	 
	 
	 	 	 	 	 	 
	III.
	 	Frozen Participation	 	 	2	 
	 
	 	 	 	 	 	 
	IV.
	 	Deferrals of Compensation Discontinued	 	 	2	 
	 
	 	 	 	 	 	 
	V.
	 	Restoration Account	 	 	2	 
	 
	 	 	 	 	 	 
	VI.
	 	Distribution	 	 	2	 
	 
	 	 	 	 	 	 
	VII.
	 	Beneficiary	 	 	4	 
	 
	 	 	 	 	 	 
	VIII.
	 	Administration of the Plan	 	 	4	 
	 
	 	 	 	 	 	 
	IX.
	 	Claims Procedure	 	 	5	 
	 
	 	 	 	 	 	 
	X.
	 	Nature of Company’s Obligation	 	 	6	 
	 
	 	 	 	 	 	 
	XI.
	 	Miscellaneous	 	 	6	 

ii

 

ARTICLE I

TITLE AND EFFECTIVE DATE

     Section 1.01 Title. This Plan shall be known as the Pier 1 Benefit Restoration Plan I
(hereinafter referred to as the “Plan”).

     Section 1.02 Effective Date. The original effective date of this Plan was April 1, 1990.
The effective date of this restatement is January 1, 2005.

     Section 1.03 Purpose of Restatement. The purpose of this January 1, 2005 restatement is to
preserve separately under the Plan benefits which are not required to comply with the requirements
of Sections 409A(2), (3) and (4) of the Code. The Plan is to be construed and interpreted in
accordance with such purpose.

ARTICLE II

DEFINITIONS AND CONSTRUCTION OF THE PLAN DOCUMENT

     As used herein, the following words and phrases shall have the meanings specified below
unless a different meaning is clearly required by the context:

     Section 2.01 Beneficiary. “Beneficiary” shall mean the person or persons designated by a
Participant as being entitled to receive any benefits under this Plan.

     Section 2.02 Board of Directors. The term “Board of Directors” shall mean the Board of
Directors of Pier 1 Imports, Inc.

     Section 2.03 Code. “Code” shall mean the Internal Revenue Code of 1986, as amended.

     Section 2.04 Committee. “Committee” means the Compensation Committee of the Board of
Directors of Pier 1 Imports, Inc. or such other committee as may be designated by such board. The
Committee shall be the plan administrator for purposes of ERISA and shall manage and administer the
Plan in accordance with this document, except for the administrative functions required to be
performed by the Company as set forth in this document.

     Section 2.05 Company. “Company” shall mean and include the “Employer” and/or “Adopting
Employers”, as such terms are defined in the Pier 1 Associates’ 401(k) Plan.

     Section 2.06 ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

     Section 2.07 “401 (k) Plan” shall mean the Pier 1 Associates 401 (k) Plan, as it shall be
amended from time to time.

     Section 2.08 Participant. “Participant” means an Executive who was a Participant in the
Plan as of December 31, 2004 and who continues to have a balance in his or her Restoration Account.

     Section 2.09 Plan. “Plan” means this Pier 1 Benefit Restoration Plan I, described in this
instrument, as amended from time to time.

     Section 2.10 Plan Year. The “Plan Year” is the calendar year.

     Section 2.11 Plan Quarter. A “Plan Quarter” is one fourth (i.e. three (3) months) of a Plan Year.

PAGE 1 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

     Section 2.12 Restoration Account. “Restoration Account” is the account described in Article V
as a bookkeeping record for each Participant of this Plan and may, at the discretion of the
Company, include one or more sub-accounts to reflect the amounts credited to a Participant under
the various terms of this Plan. As of January 1, 2005, a Participant’s Restoration Account under
the Plan shall be credited with the dollar amount equal to the portion of his Restoration Account
under the Plan as in effect as of December 31, 2004 which does not constitute amounts deferred
after December 31, 2004 for purposes of Section 409A of the Code.

ARTICLE III

FROZEN PARTICIPATION

     Participation in the Plan shall be limited to those individuals who were Participants in
the Plan as of December 31, 2004. From and after December 31, 2004, no further individuals shall
be entitled to participate in the Plan.

ARTICLE IV

DEFERRALS OF COMPENSATION DISCONTINUED

     From and after December 31, 2004, Participants shall not be entitled to defer
compensation under the Plan and no further Company matching contribution credits shall be made
under the Plan.

ARTICLE V

RESTORATION ACCOUNT

     Section 5.01 Restoration Account. Each Participant’s Restoration Account shall as of
January 1, 2005 be credited with the dollar amount equal to the portion of his Restoration Account
as of December 31, 2004 which does not constitute amounts deferred after December 31, 2004 for
purposes of Section 409A of the Code.

     Section 5.02 Interest. Each Participant’s Restoration Account balance shall be credited at
least quarterly with an amount of interest at an annual rate equal to Moody’s Corporate Bond Index,
or comparable index if Moody’s Corporate Bond Index is no longer available, plus 1% where the Index
is averaged on a daily basis for a period determined by the Company from time to time.

ARTICLE VI

DISTRIBUTION

     Section 6.01 Distributions. If a Participant has not elected installment payments
pursuant to and in accordance with Section 6.03, then (i) upon the termination of a Participant’s
employment with the Company for any reason the Participant shall deliver to the Company’s Benefits
Department an account distribution form for the Participant’s Restoration Account, and (ii) the
Participant’s Restoration Account balance shall be valued and paid to him in accordance with
Section 6.03.

     Prior to termination of his employment with the Company, a Participant may at any time elect a
“cash-out” distribution of a dollar amount equal to ninety percent (90%) of the total value
(determined as of the last day of the Plan Quarter immediately preceding the Participant’s
“cash-out” distribution request) of such Participant’s Restoration Account. Any and all remaining
amounts in such Participant’s Restoration Account as of the date the “cash-out” distribution is
effected shall be forfeited as of such date, notwithstanding Section 6.02 of the Plan. A
Participant’s “cash-out” distribution shall be made as soon as administratively practical after the
Participant has submitted a request in writing to the Company that such distribution be made. The
participation under the Pier 1 Benefit Restoration Plan II of a Participant who elects a “cash-out”
distribution of his Restoration Account under this Plan pursuant to this Section 6.01 shall be
suspended for a period of twelve (12)

PAGE 2 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

months. Such suspension shall commence as of the January 1
immediately following the date such “cash-out” distribution is elected, unless guidance from the
Internal Revenue Service (“IRS”) provides that such suspension may commence as of the date such
“cash-out” distribution is elected without resulting in an adverse tax effect pursuant to Section
409A of the Code. If such suspension commences as of the date such “cash-out” distribution is
elected, then such suspension period shall not expire until the first January 1, April 1, July 1 or
October 1 following the expiration of twelve (12) full calendar months from the date that such
“cash-out” distribution was paid to such Participant. Such Participant’s Pier 1 Benefit
Restoration Plan II participation shall be automatically resumed based upon his participation
elections that were in effect as of the date of his “cash-out” distribution from this Plan unless
he has elected new Pier 1 Benefit Restoration Plan II participation elections on or before the
December 31 immediately preceding the date such automatic participation resumption would occur in
accordance with the general participation election rules of the Pier 1 Benefit Restoration Plan II.
The “cash-out” distribution provisions of this paragraph including the provisions regarding
penalties associated with such a distribution are to be interpreted and applied so as to preserve
the status of the amounts deferred under this Plan as amounts which do not constitute amounts
deferred after December 31, 2004 for purposes of Section 409A of the Code.

     Section 6.02 Nonforfeitable Right to Restoration Account. The Participant shall have a one
hundred percent (100%) nonforfeitable and vested right to the value of his Restoration Account
under the Plan.

     Section 6.03 Time and Form of Distributions. Unless a Participant has elected an installment
form of payment and such election satisfies the conditions and provisions of this Section 6.03, the
distribution of a Participant’s Restoration Account shall be made in cash only in the form of a
single lump sum payment equaling the value (determined as of the date of such Participant’s
termination of employment with the Company) of the Participant’s Restoration Account plus interest
accrued on such amount through the date of distribution. A Participant’s lump sum distribution
payment will be made approximately ninety (90) days from the end of the Plan Quarter in which the
Participant’s employment with the Company is terminated regardless of whether an account
distribution form is received from the Participant.

     The distribution of a Participant’s Restoration Account may be made to such Participant in the
form of annual installments over a period of five (5) years provided that:

	 	(1)	 	Such Participant has attained the age of fifty-five (55) as of the date of his
termination of employment with the Company for any reason;
	 
	 	(2)	 	Such Participant is fully vested in his Restoration Account under this Plan and
under the Pier 1 Benefit Restoration Plan II as of the date of his termination of
employment with the Company for any reason; and
	 
	 	(3)	 	Such Participant makes a non-revocable election in writing on a form prescribed
by the Company and filed with the Benefits Department of the Company to receive payment
of his Restoration Account in the form of installment payments and such election is
made at least three hundred sixty-five (365) days prior to the date that such
Participant’s employment with the Company is terminated for any reason.

     Provided that the above conditions are satisfied, the Participant’s Restoration Account will
be valued as of the date of such Participant’s termination of employment with the Company. The
Restoration Account as valued shall be distributed in five (5) equal annual installments to the
Participant. The first annual installment will be made approximately ninety (90) days from the end
of the Plan Quarter in which the Participant’s employment with the Company is terminated. Each
subsequent annual installment payment will be made
approximately ninety (90) days following December 31st of each year beginning with the year of
the initial distribution. The undistributed balance of a Participant’s Restoration Account shall
be credited with interest in accordance with Section 5.02 on the same basis and in the same manner
as interest is credited on the Restoration

PAGE 3 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

Accounts of Participants who are active employees of the
Company, and each annual installment shall include the interest accrued on the undistributed
balance through the date of distribution of such payment.

     Section 6.04 Loans. No loans to Participants of amounts in a Participant’s Restoration
Account shall be permitted.

ARTICLE VII

BENEFICIARY

     Section 7.01 Beneficiaries. If a Participant is participating in the 401(k) Plan, except
as otherwise provided below, at any relevant time for purposes of this Plan a Participant’s
Beneficiaries (and their respective shares and priorities) shall be those Beneficiaries (and their
respective shares and priorities) then currently designated pursuant to the 401(k) Plan or
specially designated by the Participant pursuant to the 401(k) Plan, as the case may be. To the
extent that a Participant is not participating in the 401(k) Plan, and except as otherwise provided
below, a Participant may designate a Beneficiary or Beneficiaries pursuant to a beneficiary
designation form. A beneficiary election form will be provided to a Participant who is not
participating in the 401(k) Plan upon written request by the Participant to the Company. If a
Participant fails to have a beneficiary pursuant to the 401(k) Plan or fails to deliver to the
Company a beneficiary election form for this Plan, the Company shall have the right to distribute
the vested portion of such Participant’s Restoration Account to the respective estate of such
Participant.

     Section 7.02 Proper Beneficiary. If the Company is in doubt as to the proper Beneficiary to
receive payments hereunder, the Company shall have the right to withhold such payments until the
matter is finally adjudicated. However, any payment made by the Company, in good faith and in
accordance with this Plan, shall fully discharge the Company from all further obligations with
respect to that payment.

     Section 7.03 Minor or Incompetent Beneficiary. In making any payments to or for the benefit
of any minor or an incompetent Participant or Beneficiary, the Company, in its sole and absolute
discretion may make a distribution to a legal or natural guardian of a minor or a court appointed
guardian or representative of such incompetent. The receipt by a guardian or a court appointed
guardian or representative shall be a complete discharge to the Company and Committee. Neither the
Committee nor the Company shall have any responsibility to see to the proper application of any
payments so made.

ARTICLE VIII

ADMINISTRATION OF THE PLAN

     Section 8.01 Majority Vote. All resolutions or other actions taken by the Committee
shall be made or taken according to the procedures in effect for resolutions or actions by the Plan
Administrator of the 401(k) Plan.

     Section 8.02 Finality of Determination. Subject to the Plan, the Company shall, from time to
time, establish forms and procedures for the administration of the Plan. Except as herein
otherwise expressly provided, the Committee shall have the exclusive right to interpret the Plan
and to decide any and all matters arising thereunder or in connection with the administration of
the Plan, and it shall endeavor to act, whether by general rules or by particular decisions, so as
not to discriminate in favor of or against any person. The decisions, actions and records of the
Committee shall be conclusive and binding upon the Company and all persons having or claiming to
have any right or interest in or under the Plan.

     Section 8.03 Certificates and Reports. The members of the Committee and the officers and
directors of the Company shall be entitled to rely on all certificates and reports made by any duly
appointed accountants, and on all opinions given by any duly appointed legal counsel, which legal
counsel may be counsel for the Company.

PAGE 4 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

     Section 8.04 Indemnification and Exculpation. The Company shall indemnify and save harmless
each member of the Committee against any and all expenses and liabilities arising out of his
membership and service on the Committee. Expenses against which a member of the Committee shall be
indemnified hereunder shall include, without limitation, the amount of any settlement or judgment,
costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted,
or a proceeding brought or settlement thereof. The foregoing right of indemnification shall be in
addition to any other rights to which any such member of the Committee may be entitled as a matter
of law.

     Section 8.05 Expenses. The expenses of administering the Plan shall be borne by the Company.

     Section 8.06 Cash-Out of Non-qualifying Participants. Notwithstanding anything in this Plan
or any compensation deferral agreement to the contrary, the Company may remove from participation
in the Plan any Participant whose participation, according to any regulation (whether proposed,
temporary, or final), ruling, court case or administrative interpretation, causes or may cause the
Plan, in the sole discretion of the Company, to fail to qualify as a plan described in Section
201(2) of ERISA or any successor statutory provision. Participants so removed may, notwithstanding
the Plan or any compensation deferral agreement, be distributed immediately in one lump sum the
balance of their Restoration Accounts, but only if failure to effect such cash out distribution
would, according to any regulation (whether proposed, temporary, or final), ruling, court case or
administrative interpretation causes or may cause the Plan, in the sole discretion of the Company,
to fail to qualify as a plan described in Section 201(2) of ERISA or any successor statutory
provision.

ARTICLE IX

CLAIMS PROCEDURE

     Section 9.01 Written Claim. Retirement benefits and the value of a Participant’s
Restoration Account shall be paid in accordance with the provisions of this Plan. The Participant,
or a designated Beneficiary or any other person claiming through the Participant shall make a
written request for benefits under this Plan. This written claim shall be mailed or delivered to
the Company.

     Section 9.02 Denied Claim. If the claim is denied, in full or in part, the Company shall
provide a written notice within ninety (90) days setting forth the specific reasons for denial, and
any additional material or information necessary to perfect the claim, and an explanation of why
such material or information is necessary, and appropriate information and explanation of the steps
to be taken if a review of the denial is desired.

     Section 9.03 Review Procedure. If the claim is denied and review is desired, the Participant
(or Beneficiary) shall notify the Committee in writing within sixty (60) days after receipt of the
written notice of denial (a claim shall be deemed denied if the Committee does not take any action
within the aforesaid ninety (90) day period). In requesting a review, the Participant or his
Beneficiary may request a review of the Plan or other pertinent documents, may submit any written
issues and comments, may request an extension of time for such written submission of issues and
comments, and may request that a hearing be held before the Committee, but the decision to hold a
hearing shall be within the sole discretion of the Committee.

     Section 9.04 Committee Review. The decision on the review of the denied claim shall be
rendered by the Committee within sixty (60) days after the receipt of the request for review (if a
hearing is not held) or within sixty (60) days after the hearing if one is held. The decision
shall be written and shall state the specific reasons for the decision including reference to
specific provisions of this Plan on which the decision is based.

PAGE 5 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

ARTICLE X

NATURE OF COMPANY’S OBLIGATION

     Section 10.01 Company’s Payment Obligation. The Company’s obligations under this Plan
shall be an unfunded and unsecured promise to pay. The Company shall not be obligated under any
circumstances to fund its financial obligations under this Plan.

     Section 10.02 Creditor Status. Any assets which the Company may acquire or set aside to help
cover its financial liabilities are and must remain general assets of the Company subject to the
claims of its creditors. Neither the Company nor this Plan gives the Participant any beneficial
ownership interest in any asset of the Company. All rights of ownership in any such assets are and
remain in the Company and Participants and their beneficiaries shall have only the rights of
general creditors of the Company.

     Section 10.03 No Promise of Employment. Neither this Plan nor any agreement or writing
executed pursuant hereto shall be construed to promise or guarantee future employment of any
person.

     Section 10.04 No Guarantee of Tax Deferral. Neither this Plan nor any agreement or writing
executed pursuant hereto, shall be construed as a representation or assurance that any amounts in a
Participant’s Restoration Account shall not be subject to taxation until such amounts are paid or
distributed to such Participant or any of his Beneficiaries.

ARTICLE XI

MISCELLANEOUS

     Section 11.01 Written Notice. Any notice which shall be or may be given under the Plan
or any agreement or writing executed pursuant hereto, shall be in writing and shall be mailed by
United States mail, postage prepaid. If notice is to be given to the Company, such notice shall be
addressed to the Company, Attn: Pier 1 Benefit Restoration Plan, at the address of the Company’s
principal offices. If notice is to be given to the Committee, such notice shall be addressed to the
Committee of the Pier 1 Benefit Restoration Plan, at the address of the Company’s principal
offices. If notice is to be given to a Participant, such notice shall be addressed to the address
shown for such Participant in the Company’s records.

     Section 11.02 Change of Address. Any party may, from time to time, change the address to
which notices shall be mailed by giving written notice of such new address.

     Section 11.03 Merger, Consolidation or Acquisition. The Plan shall be binding upon the
Company, its assigns, and any successor Company which shall succeed to substantially all of its
assets and business through merger, acquisition or consolidation, and upon a Participant, his
Beneficiary, assigns, heirs, executors and administrators.

     Section 11.04 Amendment and Termination. The Company retains the sole and unilateral right to
terminate, amend, modify, or supplement this Plan, in whole or in part, at any time. This right
includes the right to make retroactive amendments. However, no Company action under this right
shall reduce the amount of the Restoration Account of any Participant or his Beneficiary.

     Section 11.05 Nontransferability. Except insofar as prohibited by applicable law, no sale,
transfer, alienation, assignment, pledge, collateralization or attachment of any benefits under
this Plan shall be valid or recognized by the Company. Neither the Participant, his spouse, or
designated Beneficiary shall have any power to hypothecate, mortgage, commute, modify, or otherwise encumber in advance of any of the
benefits payable hereunder, nor shall any of said benefits be subject to seizure for the payment of
any debts, judgments,

PAGE 6 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

alimony maintenance, owed by the Participant or his Beneficiary, or be
transferable by operation of law in the event of bankruptcy, insolvency, or otherwise.

     Section 11.06 Legal Fees. All reasonable legal fees incurred by any Participant (or former
Participant) or Beneficiary to successfully enforce his valid rights under this Plan shall be paid
by the Company in addition to sums due under this Plan.

     Section 11.07 Withholding for Taxes. The Company shall be entitled to withhold from payments
due under the Plan or from other payments of compensation to a Participant any and all taxes of any
nature required by any government to be withheld from compensation paid to employees.

     Section 11.08 Acceleration of Payment. The Company reserves the right to accelerate the
payment of any benefits payable under this Plan at any time without the consent of the Participant,
his estate, his Beneficiary or any other person claiming through the Participant.

     Section 11.09 Domestic Relations Orders. All or any portion of a Participant’s Plan benefit
will be paid to an individual other than such Participant pursuant to and in accordance with the
provisions of a domestic relations order but only if such domestic relations order satisfies all of
the requirements to be a “qualified domestic relations order” within the meaning of Section 414(p)
of the Code and only if the timing of payment or payments under the order comply with the
distribution timing requirements of Section 409A of the Code.

     Section 11.10 Gender and Number. Wherever the context so requires, masculine pronouns include
the feminine and singular words shall include the plural.

     Section 11.11 Applicable Law. This Plan shall be governed by the laws of the State of Texas.

     IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly
authorized officer effective as of January 1, 2005.

	 	 	 	 	 
	 	Pier 1 Imports, Inc. for itself

and on behalf of the Company

 	 
	Date: October 9, 2006 	By:  	/s/ Gregory  S. Humenesky
 	 
	 	 	Title: Executive Vice President, Human Resources 	 
	 	 	 	 
	 

PAGE 7 OF THE BENEFIT RESTORATION PLAN I

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005exv10w2

 

Exhibit 10.2

PIER 1

BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

PIER 1

BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

     The Pier 1 Benefit Restoration Plan was established effective as of April 1, 1990, by the
Company. The purpose of the Pier 1 Benefit Restoration Plan is to permit select members of
management and highly compensated employees of the Company to defer current compensation. In
addition, the Company desires and intends by the adoption and maintenance of this Benefit
Restoration Plan to recognize the value to the Company of the past and present services of
employees covered by the Benefit Restoration Plan and to encourage and assure their continued
service to the Company by making more adequate provision for their future retirement security. The
Pier 1 Benefit Restoration Plan was previously amended and restated effective as of December 20,
1991 and was amended and restated again effective as of July 1, 1995. Subsequent to July 1, 1995
the Pier 1 Benefit Restoration Plan was amended six (6) times. Effective as of January 1, 2005, the
portion of the Pier 1 Benefit Restoration Plan which will be subject to certain new deferred
compensation taxation laws is being separated from the portion which will not be subject to such
laws, is hereby renamed the Pier 1 Benefit Restoration Plan II and is hereby amended and restated
as hereinafter set forth in this instrument.

i

 

PIER 1

BENEFIT RESTORATION PLAN II

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	ARTICLE	 	PAGE	 
	 
	 	 	 	 	 	 
	I
	 	Title, Effective Date and Purpose of Restatement	 	 	1	 
	 
	 	 	 	 	 	 
	II
	 	Definitions and Construction of the Plan Documents	 	 	1	 
	 
	 	 	 	 	 	 
	III
	 	Eligibility	 	 	3	 
	 
	 	 	 	 	 	 
	IV
	 	Deferral of Compensation	 	 	3	 
	 
	 	 	 	 	 	 
	V
	 	Restoration Account	 	 	4	 
	 
	 	 	 	 	 	 
	VI
	 	Distribution	 	 	5	 
	 
	 	 	 	 	 	 
	VII
	 	Beneficiary	 	 	7	 
	 
	 	 	 	 	 	 
	VIII
	 	Administration of the Plan	 	 	8	 
	 
	 	 	 	 	 	 
	IX
	 	Claims Procedure	 	 	9	 
	 
	 	 	 	 	 	 
	X
	 	Nature of Company’s Obligation	 	 	9	 
	 
	 	 	 	 	 	 
	XI
	 	Miscellaneous	 	 	10	 

ii

 

ARTICLE I

TITLE, EFFECTIVE DATE AND PURPOSE OF RESTATEMENT

     Section 1.01 Title. This Plan shall be known as the Pier 1 Benefit Restoration Plan II
(hereinafter referred to as the “Plan”).

     Section 1.02 Effective Date. The original effective date of this Plan was April 1, 1990.
The effective date of this restatement is January 1, 2005.

     Section 1.03 Purpose of Restatement. The purpose of this January 1, 2005 restatement is to
cause the Plan to comply with the requirements of Sections 409A(a)(2), (3) and (4) of the Code.
The Plan is to be construed and interpreted in accordance with such purpose.

ARTICLE II

DEFINITIONS AND CONSTRUCTION OF THE PLAN DOCUMENTS

     As used herein, the following words and phrases shall have the meanings specified below unless
a different meaning is clearly required by the context:

     Section 2.01 Beneficiary. “Beneficiary” shall mean the person or persons designated by a
Participant as being entitled to receive any benefits under this Plan.

     Section 2.02 Board of Directors. The term “Board of Directors” shall mean the Board of
Directors of Pier 1 Imports, Inc.

     Section 2.03 Code. “Code” shall mean the Internal Revenue Code of 1986, as amended.

     Section 2.04 Committee. “Committee” means the Compensation Committee of the Board of
Directors of Pier 1 Imports, Inc. or such other committee as may be designated by such board. The
Committee shall be the plan administrator for purposes of ERISA and shall manage and administer the
Plan in accordance with this document, except for the administrative functions required to be
performed by the Company as set forth in this document.

     Section 2.05 Compensation. “Compensation” shall mean Compensation, as defined in the 401(k)
Plan; provided, however, that (i) no limit on annual compensation, pursuant to Code Section
401(a)(17), shall apply, and (ii) “Compensation” shall not include any forms of bonus payment other
than annual Fiscal Year bonus payments.

     Section 2.06 Company. “Company” shall mean and include the “Employer” and/or “Adopting
Employers”, as such terms are defined in the Pier 1 Associates’ 401(k) Plan.

     Section 2.07 Compensation Deferral Agreement. “Compensation Deferral Agreement” means the
written form of agreement referred to in Section 3.02 hereof which is prescribed by the Company and
executed and submitted by a Participant to the Company before the relevant Election Date.

     Section 2.08 Election Date. The “Election Date” is the date established by the Company as
the date on or before which an Executive must submit a valid Compensation Deferral Agreement to the
Company. The applicable Election Dates for an Executive who has been designated by the Committee
as eligible to participate in the Plan are as follows: (i) in the case of the first Taxable Year in
which an Executive initially becomes eligible to participate in the Plan, a date which is no later
than the thirtieth (30th) day immediately following the date the Executive initially became
eligible to participate in the

PAGE 1 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

Plan, and (ii) for any Taxable Year following the first Taxable Year in which an Executive becomes
eligible to participate in the Plan, a date which is no later than the last day of the immediately
preceding Taxable Year. For purposes of the preceding sentence:

(1) A Participant who terminates employment with the Company and who is thereafter
reemployed by the Company and designated upon such reemployment or thereafter as eligible to
participate in the Plan shall upon such designation be deemed to be initially eligible to
participate in the Plan;

(2) A Participant who voluntarily suspends his deferrals of Compensation under the Plan and
who thereafter desires to resume such Compensation deferrals shall not be deemed to be
initially eligible to participate in the Plan; and

(3) A Participant who ceases to be eligible to participate in the Plan for any reason but
who remains employed with the Company and thereafter again becomes eligible to participate
in the Plan shall not be deemed to be initially eligible to participate in the Plan.

     Section 2.09 ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

     Section 2.10 Executive. “Executive” shall mean any management employee or highly compensated
employee of the Company.

     Section 2.11 Fiscal Year. “Fiscal Year” shall mean the Company’s fiscal year.

     Section 2.12 401(k) Plan. “401(k) Plan” shall mean the Pier 1 Associates 401(k) Plan, as it
shall be amended from time to time.

     Section 2.13 Participant. “Participant” means an Executive who is participating in the Plan
within the meaning of Article III hereof.

     Section 2.14 Plan. “Plan” means this Pier 1 Benefit Restoration Plan II, described in this
instrument, as amended from time to time.

     Section 2.15 Plan Year. The “Plan Year” is the calendar year.

     Section 2.16 Restoration Account. “Restoration Account” is the account described in Article V
as a bookkeeping record for each Participant of this Plan. A Participant’s Restoration Account
shall consist of amounts attributable to Compensation deferrals for Taxable Years from and after
December 31, 2004 and of amounts credited as of December 31, 2004 to their Restoration Accounts
under the Pier 1 Benefit Restoration Plan document as then in effect which for any reason are
considered as amounts deferred after December 31, 2004 for purposes of Section 409A of the Code. A
Participant’s Restoration Account may, at the discretion of the Company, include one or more
sub-accounts to reflect the amounts credited to a Participant under the various terms of this Plan.

     Section 2.17 Taxable Year. “Taxable Year” is a twelve (12) consecutive month period beginning
January 1 and ending December 31.

PAGE 2 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

ARTICLE III

ELIBIBILITY

     Section 3.01 Eligibility. Eligibility for participation in this Plan shall be determined by
the Company, in its sole discretion; provided, however, that no Executive shall be selected for
participation in this Plan unless he qualifies as a member of a select group of management or as a
highly compensated employee of the Company within the meaning of Section 201(2) of ERISA, and such
Executive has met the eligibility service requirement of the 401 (k) Plan.

     Section 3.02 Participation. An Executive, after having been notified by the Company that he
is eligible for participation, shall complete and timely return to the Company a duly executed
Compensation Deferral Agreement. No Compensation Deferral Agreement shall be effective before
acceptance by the Company.

     Section 3.03 Subsequent Eligibility. If a Participant stops, pursuant to Section 4.05 hereof,
his deferrals of Compensation hereunder, such Participant shall lose his eligibility for
participation in this Plan until he is again selected by the Company pursuant to Section 3.01
hereof.

ARTICLE IV

DEFERRAL OF COMPENSATION

     Section 4.01 Compensation Deferral. Through the timely delivery to the Company of an executed
Compensation Deferral Agreement a Participant shall defer the receipt of a dollar amount of
Compensation otherwise payable to the Participant in the future for services that have yet to be
rendered. The dollar amount of Compensation deferred may not exceed twenty percent (20%) of the
Participant’s Compensation per Plan Year. Amounts so deferred shall be credited to such
Participant’s Restoration Account.

     Section 4.02 Company Matching Contribution. With respect to Compensation deferred under
Section 4.01, the Company shall credit to a Participant’s Restoration Account an additional amount
equal to the sum of (i) one hundred percent (100%) of the first one percent (1%) of a Participant’s
elected Compensation deferral, and (ii) fifty percent (50%) of the next four percent (4%) of the
Participant’s elected Compensation deferral. The foregoing sum shall be credited to such
Participant’s Restoration Account.

     Section 4.03 Initial Compensation Deferral Agreement. An Executive selected to participate in
the Plan pursuant to Section 3.02, must submit a written Compensation Deferral Agreement to the
Company on or before the applicable Election Date following such Executive’s initial eligibility.
A valid Compensation Deferral Agreement submitted on or before the applicable Election Date
following the Executive’s initial eligibility shall cause Compensation to be deferred beginning the
first day of the first full payroll period coincident with or immediately following the date the
Compensation Deferral Agreement is submitted by the eligible Executive to the Company. An
Executive who has been selected to participate in the Plan pursuant to Section 3.02 but who
declines to participate at that time may thereafter submit a written Compensation Deferral
Agreement to the Company for a subsequent Taxable Year as his initial Compensation Deferral
Agreement provided that he is still eligible for Plan participation and provided that such
agreement is submitted prior to the beginning of such Taxable Year. Such Compensation Deferral
Agreement shall cause Compensation to be deferred beginning the first day of the first full payroll
period coincident with or immediately following the January 1 of such Taxable Year and shall be
effective for all full payroll periods beginning in such Taxable Year. In no event, however, may a
Compensation Deferral Agreement provide for deferral of Compensation that has been earned as of the
date the Compensation Deferral Agreement is executed by the Participant.

PAGE 3 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

     Section 4.04 Duration of a Compensation Deferral Agreement. A Compensation Deferral Agreement
shall remain in effect until revoked or modified by the execution of a new Compensation Deferral
Agreement by the Participant.

     Section 4.05 Compensation Deferral Agreement Changes. On or before the applicable Election
Date for a Taxable Year, a Participant may elect by a written Compensation Deferral Agreement
submitted to the Company to stop, increase or decrease the amount of Compensation deferrals for
such Taxable Year. A Compensation deferral change elected by a Participant with respect to a
Taxable Year shall be effective for all full payroll periods beginning in such Taxable Year. No
change in Compensation deferrals will be permitted for any Taxable Year after the beginning of such
Taxable Year or commencement date for such deferrals in the case of initial eligibility to
participate in the Plan except that the Company may, in its sole discretion, permit Participants to
make such Compensation deferral election changes as may be designated as permissible pursuant to
Treasury Regulations or other binding guidance issued by the Internal Revenue Service with respect
to the requirements of Sections 409A(2), (3) and (4) of the Code.

     Section 4.06 Compensation Deferral Suspension. Any Participant who elects a “cash-out”
distribution of his Restoration Account balance under the Pier 1 Benefit Restoration Plan I
pursuant to Section 6.01 thereof shall (i) forfeit that amount of deferred Compensation, Company
matching contributions and earnings under this Plan as are necessary to preserve the status of the
“cash-out” distribution provision of the Pier 1 Benefit Restoration Plan I as a benefit that has
not been materially modified for purposes of Section 409A of the Code, and (ii) have his
participation under this Plan suspended in accordance with the terms of Section 6.01 of the Pier 1
Benefit Restoration Plan I. The Participant’s participation under this Plan shall be automatically
resumed in accordance with the terms of Section 6.01 of the Pier 1 Benefit Restoration Plan I.

     Section 4.07 Annual Bonus Deferrals. Compensation deferrals for annual bonus amounts which are
payable with respect to any Fiscal Year beginning after the Taxable Year in which the Executive
first becomes eligible to participate in the Plan will be effected based upon his Compensation
deferral election made prior to the beginning of the Taxable Year in which such Fiscal Year begins.
The annual bonus amount on which Compensation deferrals are to be effected for the Fiscal Year
beginning in the Taxable Year in which an Executive first became eligible to and first elected to
participate in the Plan shall be reduced to reflect the portion of such annual bonus payment, if
any, which is based upon service completed by such Executive prior to the date of his Compensation
deferral election.

ARTICLE V

RESTORATION ACCOUNT

     Section 5.01 Restoration Account. Each Participant’s Restoration Account shall as of January
1, 2005 be credited with the dollar amount equal to the portion of his Restoration Account as of
December 31, 2004 which constitutes amounts deferred after December 31, 2004 for purposes of
Section 409A of the Code. Thereafter, Compensation elected to be deferred by a Participant under a
written Compensation Deferral Agreement and Company matching contributions shall be credited in a
dollar amount to the Restoration Account of such Participant.

     Section 5.02 Interest. Each Participant’s Restoration Account balance shall be credited at
least quarterly with an amount of interest at an annual rate equal to Moody’s Corporate Bond Index,
or comparable index if Moody’s Corporate Bond Index is no longer available, plus 1% where the Index
is averaged on a daily basis for a period determined by the Company from time to time.

PAGE 4 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

ARTICLE VI

DISTRIBUTION

     Section 6.01 Distributions. If a Participant has not elected installment payments pursuant to
and in accordance with Section 6.04, then upon the termination of a Participant’s employment with
the Company for any reason, the Participant’s vested portion of his Restoration Account balance
shall be valued and paid to him in accordance with Section 6.04 and the non-vested portion of such
Restoration Account balance plus interest earned and accrued on such amount, if any, shall be
forfeited. For purposes of the Plan, a Participant will only be deemed to have terminated
employment with the Company if the facts and circumstances are such that he has had a separation
from service with the Company pursuant to guidance issued by the Internal Revenue Service under
Section 409A of the Code.

     Section 6.02 Nonforfeitable Right to Employee Contributions. The Participant shall have a one
hundred percent (100%) nonforfeitable and vested right to the value of his Restoration Account
attributable to his Compensation deferrals under Section 4.01 hereof and the interest earned on
such deferrals under Section 5.02 hereof.

     Section 6.03 Vesting of Company Matching Contributions. A Participant is vested in any
Company matching contributions arising under Section 4.02 of this Plan (plus interest thereon
pursuant to Section 5.02) according to the provisions of the 401(k) Plan that are applicable to the
vesting of Employer matching contributions under such 401(k) Plan, irrespective of whether a
Participant is actually participating in the 401(k) Plan.

     Section 6.04 Time and Form of Distributions. Unless a Participant has elected an installment
form of payment and such election satisfies the conditions and provisions of this Section 6.04, the
distribution of the vested portion of a Participant’s Restoration Account shall be made in cash
only in the form of a single lump sum payment equaling the value (determined as of the date of such
Participant’s termination of employment with the Company) of the Participant’s vested portion of
his Restoration Account plus interest accrued on such amount through the date of distribution. A
Participant’s lump sum distribution payment will be made no later than the 15th day of
the third calendar month following the end of the calendar quarter in which the Participant’s
employment with the Company is terminated regardless of whether an account distribution form is
received from the Participant.

     The distribution of a Participant’s Restoration Account may be made to such Participant in the
form of annual installments over a period of five (5) years commencing as described below provided
that such election will be effective only if:

(1) Such Participant has attained the age of fifty-five (55) as of the date of his
termination of employment with the Company; and

(2) Such Participant is fully vested in his Restoration Account as of the date of his
termination of employment with the Company.

     Subject to the special election right described in Section 6.05 below, a Participant’s
election to receive distribution of his Restoration Account in the form of annual installments must
be made at the time that he first elects to effect Compensation deferrals under the Plan, shall be
non-revocable and shall be made in writing on a form prescribed by the Company and filed with the
Benefits Department of the Company. Provided that the above conditions are satisfied, the
Participant’s Restoration Account will be valued as of the date of the Participant’s termination of
employment with the Company. The Restoration Account as valued shall be distributed in five (5)
equal annual installments to the Participant. The first annual installment will be made
approximately ninety (90) days from the end of the calendar quarter in

PAGE 5 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

which the Participant’s employment with the Company is terminated. Each subsequent annual
installment payment will be made approximately ninety (90) days following December 31st of each
year beginning with the year of the initial distribution. The undistributed balance of a
Participant’s Restoration Account shall be credited with interest in accordance with Section 5.02
on the same basis and in the same manner as interest is credited on the Restoration Accounts of
Participants who are active employees of the Company, and each annual installment shall include the
interest accrued on the undistributed balance through the date of distribution of such payment.

     Section 6.05 Special Election Right. If a Participant failed to elect distribution of his
Restoration Account in the form of annual installments at the time described in Section 6.04, such
Participant may thereafter make a non-revocable election in writing on a form prescribed by the
Company and filed with the Benefits Department of the Company to receive payment of his Restoration
Account in the form of installment payments provided that such election will not take effect until
at least twelve (12) months after the date on which it filed with the Benefits Department of the
Company and will be effective only if:

(1) Such Participant has attained the age of fifty-five (55) as of the date of his
termination of employment with the Company; and

(2) Such Participant is fully vested in his Restoration Account as of the date of his
termination of employment with the Company.

(3) Such Participant remains employed with the Company for at least twelve (12) months after
the election is filed with the Company.

     Provided that the above conditions are satisfied, the Participant’s Restoration Account will
be valued as of the date of commencement of such Participant’s Restoration Account installment
distributions. The Restoration Account as valued shall be distributed in five (5) equal annual
installments to the Participant. The first annual installment will be made approximately ninety
(90) days from:

(1) the end of the calendar quarter in which the Participant’s employment with the Company
is terminated if such termination was by reason of death or disability within the meaning of
Section 409A(2)( C) of the Code; or

(2) the fifth anniversary of the date of the Participant’s termination of employment if such
termination was for any reason other than death or disability within the meaning of Section
409A(2)( C) of the Code.

     Each subsequent annual installment payment will be made approximately ninety (90) days
following December 31st of each year beginning with the year of the initial distribution. The
undistributed balance of a Participant’s Restoration Account shall be credited with interest in
accordance with Section 5.02 on the same basis and in the same manner as interest is credited on
the Restoration Accounts of Participants who are active employees of the Company, and each annual
installment shall include the interest accrued on the undistributed balance through the date of
distribution of such payment.

     Section 6.06 Loans. No loans to Participants of amounts in a Participant’s Restoration
Account shall be permitted.

     Section 6.07 Key Employee Distributions. Notwithstanding any other provisions of this Article
VI, in the case of any Participant who is a “key employee” as such term is defined in Section
416(i) of the Code without regard to paragraph (5) thereof, no distribution may be made from the
Plan to

PAGE 6 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

such Participant as a result of his separation from service with the Company before the date
which is six (6) months after the date of such separation from service (or, if earlier, the date of
death of the Participant following such separation from service) unless such separation from
service was by reason of any of the events described in Sections 409A(a)(2)(A)(ii), (iii), (iv),
(v) or (vi) of the Code.

     Section 6.08 Hardship Withdrawals. A Participant who has incurred an unforeseeable emergency
(as hereinafter described) may, with the consent of the Company in its sole discretion, withdraw
from his Restoration Account an amount not in excess of the amount necessary to satisfy such
emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the
distribution, which maximum amount shall be determined after taking into account the extent to
which such hardship is or may be relieved through reimbursement of compensation by insurance or
otherwise or by liquidation of the Participant’s assets (to the extent that the liquidation of such
assets would not itself cause severe financial hardship). Any such withdrawal may be requested by
submitting a written request to the Company which shall include such information as the Company may
request in order to determine if the requirements described in this Section 6.08 are satisfied such
that the withdrawal may be approved. For purposes of this Section 6.08, the term “unforeseeable
emergency” means a severe financial hardship to the Participant resulting from an illness or
accident of the Participant, the Participant’s spouse or a dependent (as defined in Section 152(a)
of the Code) of the Participant, loss of the Participant’s property due to casualty, or other
similar extraordinary and unforeseeable circumstances arising as a result of events beyond the
control of the Participant.

ARTICLE VII

BENEFICIARY

     Section 7.01 Beneficiaries. If a Participant is participating in the 401(k) Plan, except as
otherwise provided below, at any relevant time for purposes of this Plan a Participant’s
Beneficiaries (and their respective shares and priorities) shall be those Beneficiaries (and their
respective shares and priorities) then currently designated pursuant to the 401(k) Plan or
specially designated by the Participant pursuant to the 401(k) Plan, as the case may be. To the
extent that a Participant is not participating in the 401(k) Plan, and except as otherwise provided
below, a Participant may designate a Beneficiary or Beneficiaries pursuant to a beneficiary
designation form. A beneficiary election form will be provided to a Participant who is not
participating in the 401(k) Plan upon written request by the Participant to the Company. If a
Participant fails to have a beneficiary pursuant to the 401(k) Plan or fails to deliver to the
Company a beneficiary election form for this Plan, the Company shall have the right to distribute
the vested portion of such Participant’s Restoration Account to the respective estate of such
Participant.

     Section 7.02 Proper Beneficiary. If the Company is in doubt as to the proper Beneficiary to
receive payments hereunder, the Company shall have the right to withhold such payments until the
matter is finally adjudicated. However, any payment made by the Company, in good faith and in
accordance with this Plan, shall fully discharge the Company from all further obligations with
respect to that payment.

     Section 7.03 Minor or Incompetent Beneficiary. In making any payments to or for the benefit
of any minor or an incompetent Participant or Beneficiary, the Company, in its sole and absolute
discretion may make a distribution to a legal or natural guardian of a minor or a court appointed
guardian or representative of such incompetent. The receipt by a guardian or a court appointed
guardian or representative shall be a complete discharge to the Company and Committee. Neither the
Committee nor the Company shall have any responsibility to see to the proper application of any
payments so made.

PAGE 7 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

ARTICLE VIII

ADMINISTRATION OF THE PLAN

     Section 8.01 Majority Vote. All resolutions or other actions taken by the Committee shall be
made or taken according to the procedures in effect for resolutions or actions by the Plan
Administrator of the 401(k) Plan.

     Section 8.02 Finality of Determination. Subject to the Plan, the Company shall, from time to
time, establish forms and procedures for the administration of the Plan. Except as herein
otherwise expressly provided, the Committee shall have the exclusive right to interpret the Plan
and to decide any and all matters arising thereunder or in connection with the administration of
the Plan, and it shall endeavor to act, whether by general rules or by particular decisions, so as
not to discriminate in favor of or against any person. The decisions, actions and records of the
Committee shall be conclusive and binding upon the Company and all persons having or claiming to
have any right or interest in or under the Plan.

     Section 8.03 Certificates and Reports. The members of the Committee and the officers and
directors of the Company shall be entitled to rely on all certificates and reports made by any duly
appointed accountants, and on all opinions given by any duly appointed legal counsel, which legal
counsel may be counsel for the Company.

     Section 8.04 Indemnification and Exculpation. The Company shall indemnify and save harmless
each member of the Committee against any and all expenses and liabilities arising out of his
membership and service on the Committee. Expenses against which a member of the Committee shall be
indemnified hereunder shall include, without limitation, the amount of any settlement or judgment,
costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted,
or a proceeding brought or settlement thereof. The foregoing right of indemnification shall be in
addition to any other rights to which any such member of the Committee may be entitled as a matter
of law.

     Section 8.05 Expenses. The expenses of administering the Plan shall be borne by the Company.

     Section 8.06 Cash-Out of Non-qualifying Participants. Notwithstanding anything in this Plan
or any Compensation Deferral Agreement to the contrary, the Company may, in its sole discretion,
remove from participation in the Plan any Participant (and cancel such Participant’s Compensation
Deferral Agreement) (i) whose participation, according to any regulation (whether proposed,
temporary, or final), ruling, court case or administrative interpretation, causes or may cause the
Plan, in the sole discretion of the Company, to fail to qualify as a plan described in Section
201(2) of ERISA or any successor statutory provision, or (ii) who subsequent to execution of their
Compensation Deferral Agreement becomes ineligible to participate in the Plan. Participants so
removed may, notwithstanding the Plan or any Compensation Deferral Agreement, be distributed
immediately in one lump sum the vested balance of their Restoration Accounts and the unvested
portion shall be forfeited but only if failure to effect such cash out distribution and forfeiture
would, according to any regulation (whether proposed, temporary, or final), ruling, court case or
administrative interpretation causes or may cause the Plan, in the sole discretion of the Company,
to fail to qualify as a plan described in Section 201(2) of ERISA or any successor statutory
provision.

PAGE 8 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

ARTICLE IX

CLAIMS PROCEDURE

     Section 9.01 Written Claim. Retirement benefits and the value of a Participant’s Restoration
Account shall be paid in accordance with the provisions of this Plan and any applicable
Compensation Deferral Agreement. The Participant, or a designated Beneficiary or any other person
claiming through the Participant shall make a written request for benefits under this Plan. This
written claim shall be mailed or delivered to the Company.

     Section 9.02 Denied Claim. If the claim is denied, in full or in part, the Company shall
provide a written notice within ninety (90) days setting forth the specific reasons for denial, and
any additional material or information necessary to perfect the claim, and an explanation of why
such material or information is necessary, and appropriate information and explanation of the steps
to be taken if a review of the denial is desired.

     Section 9.03 Review Procedure. If the claim is denied and review is desired, the Participant
(or Beneficiary) shall notify the Committee in writing within sixty (60) days after receipt of the
written notice of denial (a claim shall be deemed denied if the Committee does not take any action
within the aforesaid ninety (90) day period). In requesting a review, the Participant or his
Beneficiary may request a review of the Plan or other pertinent documents, may submit any written
issues and comments, may request an extension of time for such written submission of issues and
comments, and may request that a hearing be held before the Committee, but the decision to hold a
hearing shall be within the sole discretion of the Committee.

     Section 9.04 Committee Review. The decision on the review of the denied claim shall be
rendered by the Committee within sixty (60) days after the receipt of the request for review (if a
hearing is not held) or within sixty (60) days after the hearing if one is held. The decision
shall be written and shall state the specific reasons for the decision including reference to
specific provisions of this Plan or a Compensation Deferral Agreement on which the decision is
based.

ARTICLE X

NATURE OF COMPANY’S OBLIGATION

     Section 10.01 Company’s Payment Obligation. The Company’s obligations under this Plan shall
be an unfunded and unsecured promise to pay. The Company shall not be obligated under any
circumstances to fund its financial obligations under this Plan.

     Section 10.02 Creditor Status. Any assets which the Company may acquire or set aside to help
cover its financial liabilities are and must remain general assets of the Company subject to the
claims of its creditors. Neither the Company nor this Plan gives the Participant any beneficial
ownership interest in any asset of the Company. All rights of ownership in any such assets are and
remain in the Company and Participants and their beneficiaries shall have only the rights of
general creditors of the Company.

     Section 10.03 No Promise of Employment. Neither this Plan nor any agreement or writing
executed pursuant hereto, including, but not limited to, any Compensation Deferral Agreement, shall
be construed to promise or guarantee future employment of any person.

     Section 10.04 No Guarantee of Tax Deferral. Neither this Plan nor any agreement or writing
executed pursuant hereto, shall be construed as a representation or assurance that any amounts in a
Participant’s Restoration Account shall not be subject to taxation until such amounts are paid or
distributed to such Participant or any of his Beneficiaries.

PAGE 9 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

ARTICLE XI

MISCELLANEOUS

     Section 11.01 Written Notice. Any notice which shall be or may be given under the Plan or a
Compensation Deferral Agreement shall be in writing and shall be mailed by United States mail,
postage prepaid. If notice is to be given to the Company, such notice shall be addressed to the
Company, Attn: Pier 1 Benefit Restoration Plan, at the address of the Company’s principal offices.
If notice is to be given to the Committee, such notice shall be addressed to the Committee of the
Pier 1 Benefit Restoration Plan, at the address of the Company’s principal offices. If notice is to
be given to a Participant, such notice shall be addressed to the address shown in such
Participant’s Compensation Deferral Agreement.

     Section 11.02 Change of Address. Any party may, from time to time, change the address to
which notices shall be mailed by giving written notice of such new address.

     Section 11.03 Merger, Consolidation or Acquisition. The Plan shall be binding upon the
Company, its assigns, and any successor Company which shall succeed to substantially all of its
assets and business through merger, acquisition or consolidation, and upon a Participant, his
Beneficiary, assigns, heirs, executors and administrators.

     Section 11.04 Amendment and Termination. The Company retains the sole and unilateral right to
terminate, amend, modify, or supplement this Plan, in whole or in part, at any time. This right
includes the right to make retroactive amendments. However, no Company action under this right
shall reduce the amount of the Restoration Account, whether vested or not, of any Participant or
his Beneficiary.

     Section 11.05 Nontransferability. Except insofar as prohibited by applicable law, no sale,
transfer, alienation, assignment, pledge, collateralization or attachment of any benefits under
this Plan shall be valid or recognized by the Company. Neither the Participant, his spouse, or
designated Beneficiary shall have any power to hypothecate, mortgage, commute, modify, or otherwise
encumber in advance of any of the benefits payable hereunder, nor shall any of said benefits be
subject to seizure for the payment of any debts, judgments, alimony maintenance, owed by the
Participant or his Beneficiary, or be transferable by operation of law in the event of bankruptcy,
insolvency, or otherwise.

     Section 11.06 Legal Fees. All reasonable legal fees incurred by any Participant (or former
Participant) or Beneficiary to successfully enforce his valid rights under this Plan shall be paid
by the Company in addition to sums due under this Plan.

     Section 11.07 Withholding for Taxes. The Company shall be entitled to withhold from payments
due under the Plan or from other payments of Compensation to a Participant any and all taxes of any
nature required by any government to be withheld from compensation paid to employees.

     Section 11.08 Acceleration of Payment. The Company reserves the right to accelerate the
payment of any benefits payable under this Plan at any time without the consent of the Participant,
his estate, his Beneficiary or any other person claiming through the Participant.

     Section 11.09 Domestic Relations Orders. All or any portion of a Participant’s Plan benefit
will be paid to an individual other than such Participant pursuant to and in accordance with the
provisions of a domestic relations order but only if such domestic relations order satisfies all of
the requirements to be a “qualified domestic relations order” within the meaning of Section 414(p)
of the Code and only if the timing of payment or payments under the order comply with the
distribution timing requirements of Section 409A of the Code.

PAGE 10 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

 

 

     Section 11.10 Gender and Number. Wherever the context so requires, masculine pronouns include
the feminine and singular words shall include the plural.

     Section 11.11 Applicable Law. This Plan shall be governed by the laws of the State of Texas.

     IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly
authorized officer effective as of January 1, 2005.

	 	 	 	 	 
	 	Pier 1 Imports, Inc. for itself and on 

behalf of the Company

 	 
	Date: October 9, 2006 	By:  	/s/ Gregory S. Humenesky
 	 
	 	 	Title: Executive Vice President, Human Resources 	 

PAGE 11 OF THE BENEFIT RESTORATION PLAN II

AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00111-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00111-of-00352.parquet"}]]