Pep Boys 2013 Annual Report Download - page 66

B-8
(ii) To the extent Restricted Stock is designated as qualified performance-based
compensation under Section 162(m) of the Code, no such Restricted Stock will be granted as an alternative to any
other award that is not designated as qualified performance-based compensation and such Restricted Stock will be
separate and apart from all other awards granted.
(iii) For any Restricted Stock designated to qualify as qualified performance-based
compensation under Section 162(m) of the Code, the performance goals will be based on pre-established, objective
business criteria and will be set forth in writing by the Committee within the period required under Section 162(m) of
the Code. The relevant business criteria will include at least one of the following: (1) return on total stockholder
equity; (2) earnings per share of Pep Boys Stock; (3) net income (before or after taxes); (4) earnings before interest,
taxes, depreciation and amortization; (5) sales or revenue targets; (6) return on assets, capital or investment; (7) cash
flow; (8) market share; (9) cost reduction goals; (10) budget comparisons; (11) implementation or completion of
projects or processes strategic or critical to our business operation; (12) measures of customer satisfaction; and/or
(13) any combination of, or a specified increase in, any of the foregoing. The performance goals established by the
Committee may be based upon the attainment of specified levels of our performance under one or more of the
measures described above relative to the performance of other entities and may also be based on the performance of
one of our business units or divisions or any subsidiary. The Committee will determine the objective business
criteria upon which the performance goals are based and the weight to be accorded each. Performance goals need
not be uniform among Participants.
(iv) The Committee shall certify the performance results for the performance period
specified in the Restricted Stock Agreement after the performance period ends. The Committee shall determine the
amount, if any, to be paid pursuant to each grant of Restricted Stock (including dividend equivalents granted with
respect to phantom units) based on the achievement of the performance goals and the satisfaction of all other terms
of the Restricted Stock Agreement. In determining the actual amount to be paid pursuant to a grant for a
performance period, the Committee may reduce or eliminate the amount of the award if, in its sole judgment, such
reduction or elimination is appropriate. The Committee shall not have the discretion to (A) grant or provide payment
in respect of an award for a performance period if the performance goals for such performance period have not been
attained or (B) increase an award above the maximum amount payable under such award.
(v) The Committee may provide in the Restricted Stock Agreement that Restricted
Stock (including dividend equivalents granted with respect to phantom units) granted under this Section 9(d) shall be
payable, in whole or in part, in the event of the Participant’s death or disability, Change of Control or under other
circumstances consistent with the Treasury regulations and rulings under Section 162(m) of the Code.
(e) Forfeiture of Shares.
(i) Except as otherwise provided by the Committee, in the event the Participant’s
employment or service with the Company terminates for any reason other than due to the Company’s termination of
the Participant due to Disability or death, or as specified in Section 10 of the Plan, any Shares subject to the
Participant’s Restricted Stock which has not Vested shall be automatically forfeited by the Participant. Shares which
are forfeited may be canceled by the Company without any action by the Participant.
(ii) Except as otherwise provided by the Committee, in the event the Participant’s
employment or service with the Company is terminated by the Company due to the Participant’s Disability or death,
any of the Participant’s Restricted Stock which has not Vested shall, if such termination occurs more than one year
after the date of the award of such Restricted Stock, vest in the prorated amount equal to the ratio of (A) the number
of whole years between the date of the Award and the date of such termination to (B) the total Restricted Period to
which the Award is subject, and the balance of the Restricted Stock shall be forfeited. If such termination occurs less
than one year after the date of grant of the Award, the Participant’s Restricted Stock shall be automatically forfeited
by the Participant and may be canceled by the Company without any action by the Participant.
(f) Transfers. During the Restricted Period, no Restricted Stock awarded under the Plan or
any interest therein may be transferred, except by will or by the laws of descent and distribution. During the lifetime