Pep Boys 2013 Annual Report Download - page 140

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THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended February 1, 2014, February 2, 2013 and January 28, 2012
NOTE 14—EQUITY COMPENSATION PLANS
The Company has a stock-based compensation plan (the ‘‘2009 Plan’’) under which it has
previously granted, and may continue to grant, non-qualified stock options, incentive stock options,
restricted stock units (‘‘RSUs’’), and Performance Share Units (‘‘PSUs’’) to key employees and
members of its Board of Directors. As of February 1, 2014, there were 2,738,100 awards outstanding
and 770,361 awards available for grant under the 2009 Plan.
Incentive stock options and non-qualified stock options granted to non-officers vest fully on the
third anniversary of their grant date and to officers vest in equal tranches over three or four year
periods. Generally, all 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 vest in equal tranches over three or four year periods. PSUs granted to officers vest on the
third anniversary of their grant date if, and only if, certain predetermined performance targets are
achieved.
The Company has also granted RSUs under the 2009 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 was 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. On January 31, 2014, the Company amended and restated the deferred compensation
plan to eliminate the automatic matching employer contributions effective for fiscal 2014.
The terms and conditions applicable to future grants under the 2009 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 all
share requirements resulting from RSU and PSU conversions and option exercises from its treasury
stock. The Company believes its treasury share balance at February 1, 2014 is adequate to satisfy such
activity during the next twelve-month period.
The following table summarizes the options under the plans:
Fiscal Year 2013
Weighted
Average
Exercise
Shares Price
Outstanding—beginning of year ....................... 1,678,593 $ 8.20
Granted ........................................ 308,963 11.86
Exercised ........................................ (188,652) 7.16
Forfeited ........................................ (84,514) 11.02
Expired ......................................... (55,919) 13.48
Outstanding—end of year ............................ 1,658,471 8.67
Vested and expected to vest options—end of year .......... 1,630,736 8.62
Options exercisable—end of year ...................... 1,158,960 7.53
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