Pep Boys 2005 Annual Report Download - page 63

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58
THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended January 28, 2006, January 29, 2005 and January 31, 2004
(dollar amounts in thousands, except share data)
The following schedule presents the calculation of basic and diluted earnings per share for net (loss) earnings from
continuing operations:
Year ended
January 28,
2006
January 29,
2005
January 31,
2004
(a) Net (loss) earnings from continuing operations before cumulative
effect of change in accounting principle $ (35,773) $ 25,455 $ (15,383)
Adjustment for interest on convertible senior notes, net of income tax
effect — — —
(b) Adjusted net (loss) earnings from continuing operations $ (35,773) $ 25,455 $ (15,383)
(c) Average number of common shares outstanding during period 54,794 56,353 52,185
Common shares assumed issued upon conversion of convertible senior
notes — — —
Common shares assumed issued upon exercise of dilutive stock options,
net of assumed repurchase, at the average market price — 1,296 —
(d) Average number of common shares assumed outstanding during period 54,794 57,649 52,185
Basic (Loss) Earnings Per Share:
Net (Loss) Earnings From Continuing Operations Before Cumulative
Effect of Change in Accounting Principle (a/c) $ (0.65) $ 0.45 $ (0.29)
Loss from Discontinued Operations, Net of Tax — (0.03) (0.31)
Cumulative Effect of Change in Accounting Principle, Net of Tax (0.04) — (0.05)
Basic (Loss) Earnings Per Share $ (0.69) $ 0.42 $ (0.65)
Diluted (Loss) Earnings Per Share:
Net (Loss) Earnings From Continuing Operations Before Cumulative
Effect of Change in Accounting Principle (b/d) $ (0.65) 0.44 $ (0.29)
Discontinued Operations, Net of Tax — (0.03) (0.31)
Cumulative Effect of Change in Accounting Principle, Net of Tax (0.04) — (0.05)
Diluted (Loss) Earnings Per Share $ (0.69) $ 0.41 $ (0.65)
NOTE 12—EQUITY COMPENSATION PLANS
Options to purchase the Company’s common stock have been granted to key employees and members of the Board of
Directors. The option prices are at least 100% of the fair market value of the common stock on the grant date.
On May 21, 1990, the stockholders approved the 1990 Stock Incentive Plan, which authorized the issuance of restricted
stock and/or options to purchase up to 1,000,000 shares of the Company’s common stock. Additional shares in the amounts of
2,000,000, 1,500,000 and 1,500,000 were authorized by stockholders on June 4, 1997, May 31, 1995 and June 1, 1993,
respectively. In April 2001, the Board of Directors amended the 1990 Stock Incentive Plan to extend the expiration date for
the grant of non-qualified stock options and restricted stock thereunder to directors, officers and employees until March 31,
2005. Under this plan, both incentive and non-qualified stock options may be granted to eligible participants. Incentive stock
options are fully exercisable on the second or third anniversary of the grant date or become exercisable over a four-year period
with one-fifth exercisable on the grant date and one-fifth on each anniversary date for the four years following the grant date.
Non-qualified options are fully exercisable on the third anniversary of their grant date or become exercisable over a four-year
period with one-fifth exercisable on the grant date and one-fifth on each anniversary date for the four years following the
grant date. Options cannot be exercised more than ten years after the grant date. As of January 28, 2006, there are no shares
available for grant.