Pep Boys 2012 Annual Report Download - page 106

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THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended February 2, 2013, January 28, 2012 and January 29, 2011
NOTE 13—BENEFIT PLANS (Continued)
The following table provides a summary of changes in fair value of Level 3 financial assets during
fiscal 2012:
Fair
(dollar amounts in thousands) Value
Balance, January 28, 2012 .................................... $1,334
Transfers from other investments ............................... —
Interest income and gains .................................... 116
Administrative fees ......................................... (72)
Benefits paid during the period ................................ (1,378)
Balance, February 2, 2013 .................................... $ —
DEFERRED COMPENSATION PLAN
The Company maintains a non-qualified deferred compensation plan that allows its officers and
certain other employees to defer up to 20% of their annual salary and 100% of their annual bonus.
Additionally, the first 20% of an officer’s bonus deferred into the Company’s stock is matched by the
Company on a one-for-one basis with Company stock that vests and is expensed over three years. The
shares required to satisfy distributions of voluntary bonus deferrals and the accompanying match in the
Company’s stock are issued from its treasury account.
RABBI TRUST
The Company establishes and maintains a deferred liability for the non-qualified deferred
compensation plan and the Account Plan. The Company plans to fund this liability by remitting the
officers’ deferrals to a Rabbi Trust where these deferrals are invested in variable life insurance policies.
These assets are included in non-current other assets and are considered to be a Level 2 measure
within the fair value hierarchy. Accordingly, all gains and losses on these underlying investments, which
are held in the Rabbi Trust to fund the deferred liability, are recognized in the Company’s
Consolidated Statement of Operations. Under these plans, there were liabilities of $6.7 million at
February 2, 2013 and $6.9 million at January 28, 2012, respectively, which are recorded primarily in
other long-term liabilities.
NOTE 14—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. There are 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. On June 24, 2009, the stockholders renamed the
1999 Plan to the 2009 Plan, extended its terms to December 31, 2014 and increased the number of
shares issuable thereunder by 1,500,000. As of February 2, 2013, there were 2,751,725 awards
outstanding and 984,840 awards available for grant under the 2009 Plan.
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