Pep Boys 2006 Annual Report Download - page 105

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THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended February 3, 2007, January 28, 2006 and January 29, 2005
(dollar amounts in thousands, except share data)
66
For the years ended February 3, 2007, January 28, 2006 and January 29, 2005, there were 2,459,618,
4,802,970 and 1,950,980 options and restricted stock units that were not included in the computation of
diluted EPS because they were antidilutive for the periods.
NOTE 11—EQUITY COMPENSATION PLANS
The Company has a stock-based compensation plan originally approved by the stockholders on
May 21, 1990 under which it has previously granted non-qualified stock options and incentive stock options
to key employees and members of its Board of Directors. As of February 3, 2007, there were no awards
remaining available for grant under the 1990 Plan. The Company has a stock-based compensation plan
originally approved by the stockholders on June 2, 1999 under which it has previously granted and may
continue to grant non-qualified stock options, incentive stock options and restricted stock units (RSUs) to
key employees and members of its Board of Directors. As of February 3, 2007, there were 3,243,817 awards
remaining available for grant under the 1999 Plan.
Incentive stock options and non-qualified stock options previously granted under the plans (i) to non-
officers, vest fully on the third anniversary of their grant date and (ii) to officers, vest over a four-year
period, with one-fifth vesting on each of the grant date and the next four anniversaries thereof. Generally,
options granted prior to March 3, 2004 carry an expiration date of ten years and options granted on or
after March 3, 2004 carry an expiration date of seven years.
RSUs previously granted to non-officers vest fully on the third anniversary of their grant date. RSUs
previously granted to officers (i) on or prior to January 28, 2006, generally vest over a four-year period with
one-fifth vesting on each of the grant date and the next four anniversaries thereof and (ii) after January 28,
2006, generally vest over a four-year period with one-fourth vesting on each of the first four anniversaries
of the grant date.
The Company has also granted RSUs under the 1999 plan in conjunction with its non-qualified
deferred compensation plan. Under the deferred compensation plan, the first 20% of an officer’s bonus
deferred into the Company’s stock fund is matched by the Company on a one-for-one basis with RSUs that
vest over a three-year period, with one third vesting on each of the first three anniversaries of the grant
date.
The exercise price, term and other conditions applicable to future stock option and RSU grants under
the 1999 plan are generally determined by the Board of Directors; provided that the exercise price of stock
options must be at least 100% of the quoted market price of the common stock on the grant date. The
Company currently satisfies share requirements resulting from RSU conversions and option exercises from
its Treasury. The Company believes its Treasury share balance at February 3, 2007 is adequate to satisfy
such activity during the next twelve-month period.