Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Executive Agreements
On July 17, 2019, Pier 1 Imports, Inc. (the “Company”) entered into an executive agreement with William H. Savage, Executive Vice President, Chief Supply Chain Officer, and on July 18, 2019, the Company entered into executive agreements with Mark R. Haley, Executive Vice President, Store Sales & Operations, and Robert E. Bostrom, Executive Vice President, Chief Legal and Compliance Officer and Corporate Secretary (collectively referred to as the “2019 Agreements”). The 2019 Agreements supersede and replace the executive agreements entered into by and between Mr. Savage and the Company, dated December 7, 2017, and Mr. Bostrom and the Company, dated January 23, 2019, filed as Exhibits 10.25.1 and 10.28.1, respectively, to the Company’s Annual Report on Form10-K for the fiscal year ended March 2, 2019 (the “Prior Agreements”). The 2019 Agreements reflect updates to certain provisions of the Prior Agreements and other executive severance arrangements and are intended to continue to support the Company’s retention strategy and align the Company’s practices with current practices in the Company’s industry and peer group. A summary of the terms and conditions of the 2019 Agreements is provided below.
Term. The 2019 Agreements have an initialtwo-year term, followed by automatic renewal on an annual basis, unless otherwise terminated by the Company or the executive by providing notification to the contrary at least 90 days prior to the date on which the additional term would have automatically began. However, if a change of control (as defined in the 2019 Agreements) occurs during the original term or an additional term, the term of the 2019 Agreements will extend until the later of the expiration of the original term or the additional term, as applicable, or the18-month anniversary of such change in control.
Benefits. If an executive’s employment terminates during the term of his 2019 Agreement, the Company will, in all cases, pay the executive all accrued but unpaid compensation earned by the executive through the date of termination.
If the employment of an executive is terminated by the Company without “cause” (as defined in the 2019 Agreements) other than as a result of death or disability, or the executive for “good reason” (as defined in the 2019 Agreements) during the term (other than during the three months prior to, or the 18 months following, a change of control of the Company) and the executive executes a release of claims acceptable to the Company, the Company will pay the following:
| | • | | salary continuation inbi-weekly installments for 12 months following the termination date; |
| | • | | apro-rated portion of the executive’s bonus under the short-term cash bonus plan of the Company in which the executive was eligible to participate in the year of the termination date, based on actual performance during the applicable bonus period and the number of days in such bonus period that elapse prior to the termination date; |
| | • | | a lump sum equal to the monthly cost (including any portion of the cost paid by the executive) to provide group medical, dental, vision and/or prescription drug plan benefits sponsored by the Company and maintained by the executive as of the termination date, multiplied by 12; and |
| | • | | reasonable outplacement services for up to 12 months following the termination date. |
If the employment of an executive is terminated by the Company without cause, due to the executive’s death or disability or by the executive for good reason during the three months prior to, or the 18 months following, a change of control of the Company and the executive executes a release of claims acceptable to the Company, the Company will pay the following:
| | • | | a lump sum equal to 24 months of the executive’s base salary in effect on the termination date; |
