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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 3)
PIER 1 IMPORTS, INC.
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(Name of Issuer)
Common Stock, $1.00 Par Value Per Share
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(Title of Class of Securities)
720279108
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(CUSIP Number)
with copies to:
Jon Scheving Thorsteinsson Gregory Pryor, Esq. Mats G. Carlston
Arev White & Case LLP Nixon Peabody LLP
Bankastraeti 5 1155 Avenue of the Americas 437 Madison Avenue
101 Reykjavik New York, NY 10036 New York, NY 10022
Republic of Iceland (212) 819-8247 (212) 940-3121
+44 7843 462247
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
October 3, 2007
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[ ].
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SCHEDULE 13D
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CUSIP No. 720279108
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1 NAME OF REPORTING PERSONS
Jakup a Dul Jacobsen
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
BK (see Item 3)
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Denmark
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NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED 0
BY EACH REPORTING ----- ------------------------------------------------
PERSON WITH 8 SHARED VOTING POWER
8,594,200(1)
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9 SOLE DISPOSITIVE POWER
0
----- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
8,594,200(1)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,594,200(1)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.72%
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14 TYPE OF REPORTING PERSON
IN
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(1) Jakup a Dul Jacobsen may be deemed to be the beneficial owner of the shares
of common stock of Pier 1 Imports, Inc. reported herein by Lagerinn ehf
through his direct ownership of Lagerinn ehf. See Item 3.
2
SCHEDULE 13D
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CUSIP No. 720279108
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1 NAME OF REPORTING PERSONS
Lagerinn ehf
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
BK (see Item 3)
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Republic of Iceland
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NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED 0
BY EACH REPORTING ----- ------------------------------------------------
PERSON WITH 8 SHARED VOTING POWER
8,594,200
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9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
8,594,200
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,594,200
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.72%
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14 TYPE OF REPORTING PERSON
CO
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3
SCHEDULE 13D
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CUSIP No. 720279108
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1 NAME OF REPORTING PERSONS
Kaupthing Bank hf.
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC (see Item 3)
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Republic of Iceland
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NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED 0
BY EACH REPORTING ----- ------------------------------------------------
PERSON WITH 8 SHARED VOTING POWER
0(1)
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9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
0(1)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0(1)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [X]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
N/A
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14 TYPE OF REPORTING PERSON
BK
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(1) Kaupthing Bank hf. transferred on October 3, 2007 to Lagerinn ehf, pursuant
to the terms of certain equity swap agreements with Lagerinn ehf, all of
the common stock of Pier 1 Imports, Inc., of which it was deemed to be the
beneficial owner through such equity swap agreements. See Item 3.
4
The statement on Schedule 13D filed on February 6, 2006 (the "Schedule
13D"), relating to the common stock, $1.00 par value per share, of Pier 1
Imports, Inc., a Delaware corporation (the "Issuer"), as amended by that certain
Amendment No. 1, dated as of March 22, 2006, and that certain Amendment No. 2,
dated as of , September 21, 2006, is hereby amended as set forth below by this
Amendment No. 3 to the Schedule 13D (this "Amendment").
The information set forth in the Exhibit to this Amendment is hereby
expressly incorporated herein by reference, and the responses to each item of
this Amendment are qualified in their entirety by the provisions of such
Exhibit. Capitalized terms used herein and not otherwise defined herein shall
have the respective meanings assigned to such terms in the Schedule 13D.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Item 3 of the Schedule 13D is hereby amended and restated as follows:
Jakup a Dul Jacobsen ("Jacobsen") and Lagerinn ehf, a Republic of Iceland
corporation ("Lagerinn") beneficially own 8,594,200 shares of Common Stock of
the Issuer (the "Shares"). A total of 4,251,800 of the Shares (the "Equity Swap
Shares") were originally purchased by means of equity swap agreements (the
"Equity Swap Agreements") between Lagerinn and Kaupthing Bank hf., a Republic of
Iceland Public Limited Company ("Kaupthing"). The Equity Swap Agreements were
settled (the "Settlement") on October 3, 2007 pursuant to their terms, as
described below. Consequently, Lagerinn now directly owns all the Shares. The
original aggregate purchase price of the Equity Swap Shares was $48,110,498. The
remainder of the Shares (4,342,400 Shares) were, and currently are, directly
owned by Lagerinn and were purchased for $44,992,429. Jacobsen may be deemed to
beneficially own all the Shares because of his direct ownership of all the
shares of Lagerinn.
On October 3, 2007, Lagerinn exercised its right to close out the Equity
Swap Agreements and purchased all of the Equity Swap Shares. Kaupthing no longer
may be deemed to beneficially own the Equity Swap Shares. At the Settlement,
Lagerinn paid to Kaupthing an aggregate amount of $54,843,929 (the "Settlement
Consideration"), which Settlement Consideration was comprised of (i) an amount
of $48,110,165, which reflects the decrease in value of the Equity Swap Shares
from the effective time of the Equity Swap Agreements and until the Settlement
Date, and in addition, (ii) an amount of $6,290,902 in interest which accrued on
the purchase price of the Equity Swap Shares during the period between the
effective time of the Equity Swap Agreements and the Settlement Date and (iii)
an amount of $442,862 in fees.
Lagerinn financed the Settlement Consideration with funds borrowed through
a loan from Landsbanki Islands hf. ("Landsbanki"). Pursuant to a committed
revolving credit facility, dated October 1, 2007 between Lagerinn and
Landsbanki, Lagerinn may borrow up to $78,732,306 at a floating rate based on a
spread over LIBOR (the "Settlement Consideration Loan Agreement"). Jacobsen and
Lagerinn have pledged certain assets, including 4,251,800 Shares, to Landsbanki
to secure Lagerinn's obligations under the Settlement Consideration Loan
Agreement. The foregoing summary of the Settlement Consideration Loan Agreement
is qualified in its entirety by reference to the summary of the Settlement
Consideration Loan Agreement, which is attached as Exhibit H to this Amendment.
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Lagerinn financed the purchase of the remainder of the Shares with funds
borrowed through a loan from Landsbanki. Pursuant to a committed revolving
credit facility, dated February 6, 2006 between Lagerinn and Landsbanki,
Lagerinn may borrow up to $50,000,000 at a floating rate based on a spread over
LIBOR (the "Original Loan Agreement"). Jacobsen and Lagerinn have pledged
certain assets, including the Shares (other than the Equity Swap Shares), to
Landsbanki to secure Lagerinn's obligations under the Original Loan Agreement.
Landsbanki originally purchased 4,342,200 Shares on behalf of Lagerinn. Lagerinn
then purchased such Shares from Landsbanki with the proceeds of the loan from
Landsbanki. The foregoing summary of the Original Loan Agreement is qualified in
its entirety by reference to the Original Loan Agreement, a copy of which was
filed as Exhibit E to the Schedule 13D.
Following the Settlement, Jacobsen and Lagerinn beneficially own all of the
Shares, and Kaupthing no longer is deemed to be the beneficial owner of the
Equity Swap Shares.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
Item 5 of the Schedule 13D is hereby amended and restated as follows:
(a)-(b) Set forth in the table below is the number and percentage of shares
of Common Stock beneficially owned by Jacobsen, Lagerinn and Kaupthing
(collectively, the "Reporting Persons") as of October 3, 2007.
NUMBER OF SHARES NUMBER OF SHARES AGGREGATE
BENEFICIALLY OWNED WITH BENEFICIALLY OWNED WITH NUMBER OF SHARES PERCENTAGE OF
SOLE VOTING AND SHARED VOTING AND BENEFICIALLY CLASS BENEFICIALLY
NAME DISPOSITIVE POWER DISPOSITIVE POWER OWNED OWNED(1)
------------------------ ----------------------- ----------------------- ---------------- ------------------
Reporting Persons 0 8,594,200 8,594,200 9.72
Jakup a Dul Jacobsen (2) 0 8,594,200 8,594,200 9.72
Lagerinn ehf (2) 0 8,594,200 8,594,200 9.72
Kaupthing Bank hf. 0 0 0 0
(1) The percentages of Common Stock indicated in this table are based on the
88,389,215 shares of Common Stock outstanding as of July 3, 2007, as
disclosed in the Issuer's most recent Form 10-Q filed with the Securities
and Exchange Commission. Any Common Stock not outstanding which is subject
to options or conversion privileges which the beneficial owner had the
right to exercise on or within 60 days after the date hereof is deemed
outstanding for purposes of computing the percentage of Common Stock owned
by such beneficial owner and for the Reporting Persons but is not deemed
outstanding for the purpose of computing the percentage of outstanding
Common Stock owned by any other beneficial owner.
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(2) Jacobsen may be deemed to be the beneficial owner of the Shares reported
herein as beneficially owned by Lagerinn through his direct ownership of
Lagerinn. See Item 3.
Other than as described above, no Reporting Person, and to the best
knowledge of the Reporting Persons, none of the persons set forth on Schedule A,
beneficially owns any securities of the Issuer.
(c) Other than the Settlement of the Equity Swap Agreements described in
Item 3, the Reporting Persons have not engaged in transactions in the Common
Stock during the past sixty (60) days.
(d) To the best knowledge of the Reporting Persons, no person (other than
Jacobsen and Lagerinn) has the right to receive or the power to direct the
receipt of dividends from, or the proceeds from the sale of, the Shares.
(e) As of October 3, 2007, Kaupthing no longer may be deemed to be the
beneficial owner of more than 5% of the Common Stock.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Item 7 of the Schedule 13D is hereby amended to add the following Exhibit:
Exhibit No. Description
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H Summary of Committed Revolving Credit Facility by and between
Lagerinn ehf and Landsbanki Islands hf., dated as of October 1,
2007
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: October 8, 2007
JAKUP A DUL JACOBSEN
/s/ Jakup a Dul Jacobsen
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LAGERINN EHF
/s/ Sigurdur Berntsson
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Name: Sigurdur Berntsson
Title: Chief Financial Officer
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KAUPTHING BANK HF.
/s/ Hannes Frimann Hrolfsson
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Name: Hannes Frimann Hrolfsson
Title: Head of FX and Derivatives
Sales Treasury of Kaupthing
Bank Iceland
/s/ Bjork Thorarinsdottir
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Name: Bjork Thorarinsdottir
Title: Deputy Managing Director
Corporate Banking Treasury
of Kaupthing Bank Iceland
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SCHEDULE A
Executive Officers and Directors of Lagerinn ehf.
PRESENT PRINCIPAL
OCCUPATION OR
NAME CITIZENSHIP EMPLOYMENT BUSINESS ADDRESS
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Lagerinn ehf Executive Officers
Sigurdur Berntsson Republic of Iceland Chief Financial Officer of Sundaborg 7
Lagerinn ehf 104 Reykjavik
Republic of Iceland
Jakup a Dul Jacobsen Denmark Chairman of Lagerinn ehf Sundaborg 7
104 Reykjavik
Republic of Iceland
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EXHIBIT H
Summary of Committed Revolving Credit Facility (the "Agreement"), dated October
1, 2007, between Lagerinn ehf ("Lagerinn") and Landsbanki Islands hf.
Capitalized terms used in this summary and not otherwise defined in this summary
shall have the respective meanings set froth in the Amendment.
THE FACILITY Landsbanki agreed to make available to Lagerinn a
revolving loan facility in an aggregate amount of
US$78,732,306.17 (the "Facility").
AVAILABILITY Lagerinn may draw from the Facility in one or more
borrowings, subject to the terms of the Agreement.
The total amount of such borrowings may not exceed
the aggregate amount of the Facility.
Proceeds of borrowings under the Agreement can only
be used by Lagerinn to repay loans that were used to
facilitate the purchase of specified shares,
including 4,251,800 shares of Pier 1 Imports, Inc.
(collectively, the "Loan Shares"), as set forth in
the Agreement.
REPAYMENT AND PREPAYMENT The repayment date for all amounts drawn under the
Agreement is March 26, 2008 (the "Termination
Date"). In the event of a late payment of any
principal, interest, or other amounts due under the
Agreement, an increased interest rate will be
applied from the due date and until repayment of
such amount, in accordance with Icelandic law, and
in addition, Lagerinn will reimburse Landsbanki for
costs incurred by Landsbanki in connection with the
late payment.
Lagerinn may prepay any loan prior to the
Termination Date without being subject to any
penalty or premium, upon a two (2) days' prior
written notice to Landsbanki.
INTEREST The rate of interest applicable to the Facility is
the applicable LIBOR interest plus a 2.50% margin.
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Accrued interest on amounts drawn will be payable by
Lagerinn on the earlier of the date of repayment of
such amounts or the Termination Date.
Lagerinn has the right to elect the applicable
interest calculation period from among 1, 2, 3 and
6 months' periods. Interest will accrue from day to
day, and be computed on the basis of a year of 360
days and for the actual number of days elapsed
unless for loans in British pounds, for which the
calculation basis will be 365 days.
NEGOTIATION OF INTEREST In the event that prior to the end of an interest
RATE calculation period, Landsbanki determines that, due
to market conditions, it will not be able to finance
a loan having an interest in a rate as set forth in
the Agreement, Landsbanki must notify Lagerinn ten
(10) days prior to the expiration of the relevant
interest calculation period and the parties will
negotiate a new interest rate for a period of thirty
(30) days from Landsbanki's notice. In the event
that the parties cannot agree on an interest rate
within the thirty (30) days' negotiation period,
Landsbanki has the right to demand the repayment of
all loans under the Facility upon the expiration of
such thirty (30) days' negotiation period.
In addition, Landsbanki has the right at any time
to demand renegotiation of the interest rate. In the
event that Landsbanki so demands, the parties will
negotiate a new interest rate during a thirty (30)
days' negotiation period. In the event that the
parties agree on a new interest rate, such rate will
apply to future loans drawn under the Agreement. In
the event that the parties cannot agree on a new
interest rate during such thirty (30) days'
negotiation period, Landsbanki may require the
repayment of all outstanding amounts under the
Facility at the end of such (30) days' negotiation
period.
COVENANTS Lagerinn agreed to do the following: (i)
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maintain in full force and effect at all times,
insurance policies against such risks and in such
amounts as are customarily carried by similar
companies in similar businesses; (ii) have its
accounts audited by certified accountants; (iii)
deliver to Landsbanki its audited annual accounts
within four months of the same being prepared; (iv)
furnish Landsbanki with a copy from time to time
with reasonable promptness of such financial and
other information as to itself as Landsbanki may
reasonably require; (v) refrain from pledging the
Loan Shares; and (vi) notify Landsbanki immediately
upon the occurrence of an event of default, as set
forth in the Agreement.
SECURITY INTEREST To guarantee the full payment of the loans under the
Agreement, Lagerinn pledged in favor of Landsbanki
all of the Loan Shares.
REPRESENTATIONS AND The Agreement contains customary representations and
WARRANTIES warranties by Lagerinn, including representations
regarding Lagerinn's corporate existence, powers and
authority to enter into the Agreement, the validity
and enforceability of the Agreement and
non-contravention of the Agreement with other
agreement to which Lagerinn is a party.
EVENTS OF DEFAULT The following constitute events of default pursuant
to the Agreement:
(i) Lagerinn fails to pay any amount payable under
the Agreement by the due date;
(ii) Lagerinn breaches any provision of the
Agreement including its representations and
warranties contained in the Agreement, provided that
Lagerinn has not remedied such breach within
fifteen (15) days from the date Lagerinn receives
notice thereof from Landsbanki;
(iii) Lagerinn breaches other agreements to which it
is a party;
(iv) cessation by Lagerinn of its operations or
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the sale or other disposition of all or a
substantial portion of its assets, or a decision by
Lagerinn to cease its operations or to sell or
otherwise dispose of all or a substantial portion of
its assets;
(v) Lagerinn takes any action or any legal
proceedings are taken for Lagerinn to be adjudicated
or found bankrupt or insolvent;
(vi) a change of ownership with respect to the
majority of the shares of Lagerinn without a prior
written consent of Landsbanki (in this respect
change of ownership includes, but is not limited to
mergers, consolidations or split-ups);
(vii) failure by Lagerinn to disclose to Landsbanki
any event that has a material adverse effect on the
condition, operations, assets, liabilities and
prospects of Lagerinn; and
(viii) the members of the board of directors of SMI
ehf. grant a security interest on any of the assets
held by them.
Upon the occurrence of an event of default,
Landsbanki may declare that its obligation under the
Agreement are cancelled and that all amounts under
the Agreement will be immediately due and payable.
Landsbanki, at its option, may determine that such
amount will not be immediately due and payable, and
that instead, a punitive interest rate will be
applied in accordance with Icelandic law, from the
date of the occurrence of such event of default, and
until repayment of all amounts due under the
Agreement.
TERMINATION The Agreement will terminate on the Termination Date
and all of the amounts drawn under the Facility and
not yet repaid will be repaid at such time.
GOVERNING LAW The laws of the Republic of Iceland govern the
Agreement.
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