Pep Boys 2008 Annual Report Download - page 57

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THE PEP BOYS - MANNY, MOE & JACK
ANNUAL INCENTIVE BONUS PLAN
(as amended and restated as of June 24, 2009)
The Pep Boys - Manny, Moe & Jack, a Pennsylvania corporation (the "Company"), previously established,
effective January 29, 1989, an Annual Incentive Bonus Plan (the “Plan”) for the benefit of officers of the Company
who were eligible to participate as provided therein. The Plan has been amended and restated in its entirely as
follows and approved by the Company’s shareholders to be effective as of June 24, 2009.
1. Purpose. The Plan is intended to increase the profitability of the Company by giving employees of the
Company holding positions at the levels of officer or director (such employees being hereinafter collectively
referred to as the “Eligible Employees”) a financial stake in the growth and profitability of the Company. The Plan
has the further objective of enhancing the Company's compensation packages for Eligible Employees, thus enabling
the Company to attract and retain officers and other key employees of the highest ability. The Plan is intended to
provide Eligible Employees with incentive opportunities that: (a) provide compensation opportunities which are
competitive with other companies of similar size and industry focus; (b) focus Eligible Employees’ attention on the
accomplishment of specific Company goals; and (c) recognize different levels and types of individual contributions
by providing a portion of the incentive payout for the achievement of individual objectives. The Plan is intended to
supplement, not replace, any other bonus paid by the Company to any of its Eligible Employees and is not intended
to preclude the continuation of such arrangements or the adoption of additional bonus or incentive plans, programs
or contracts.
2. Definitions.
(a) “Applicable Performance Measures” shall mean the Company Performance Measures and/or the
Individual Performance Measures upon which a Participant’s right to receive a Bonus is based.
(b) "Award Period" shall mean a measuring period of one Fiscal Year.
(c) "Bonus" shall mean a cash payment made by the Company to a Participant after an Award Period,
based on performance against specific predetermined performance objectives for both the Company and the
Participant, as calculated in accordance with the provisions of this Plan document.
(d) "Bonus Level" shall mean the level at which a Participant shall participate in the Plan as set forth
in Paragraph 4(b) hereof.
(e) "CEO" shall mean the person elected to the office of Chief Executive Officer of the Company by
the Board of Directors.
(f) “Code” shall mean the Internal Revenue Code of 1986, as amended.
(g) "Compensation Committee" shall mean the Compensation Committee of the Board. The
Compensation Committee shall consist of two or more persons appointed by the Board, each of whom shall be an
“outside director” as defined under Code section 162(m) and related Treasury regulations.
(h) "Fiscal Year" shall mean the Fiscal Year of the Company which ends on the Saturday nearest
January 31 in each year.
(i) "Participant" shall have the meaning set forth in Paragraph 4 hereof.
(j) "Salary" shall mean the base salary of a Participant for a Fiscal Year. For purposes of the
foregoing, base salary shall include (i) amounts which the Participant elects to forego to provide benefits under a
plan which satisfies the provisions of section 401(k) or section 125 of the Code and (ii) amounts which the
Participant elects to defer under a deferred compensation plan or program, other than an equity-based deferred
compensation plan, adopted by the Company. Base salary shall not include any amount attributable to any bonus