Petsmart 2010 Annual Report Download - page 72

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net cash balance. The actual number of PSUs awarded to each participant was set at a minimum threshold of 50% of
his or her target number of PSUs, regardless of performance results, and could increase up to 150% based upon
performance results. Our actual performance against the end-of-year net cash target was approved by the Board in
March 2010, and qualified participants received 150% of their target awards. The PSUs are subject to time-based
vesting, cliff vesting on the third anniversary of the initial grant date, and settle in shares at that time.
Activity for PSUs in 2010 and 2009 was as follows (in thousands):
Units
Weighted-Average
Grant Date
Fair Value Units
Weighted-Average
Grant Date
Fair Value
January 30, 2011 January 31, 2010
Year Ended
Nonvested at beginning of year ...... 570 $16.97 — $ —
Granted ........................ 288 $31.77 592 $16.96
Additional units granted for
performance achievement ......... 262 $16.96 — $ —
Vested ......................... — — — $ —
Forfeited ....................... (55) $18.89 (22) $16.69
Nonvested at end of year ........... 1,065 $22.14 570 $16.97
Management Equity Units
Beginning in 2009, certain members of management receive Management Equity Units or “MEUs.” The value
of one MEU is equal to the value of one share of our common stock and cliff vests on the third anniversary of the
grant date. The payout value of the vested MEU grants will be determined using our closing stock price on the vest
date and will be paid out in cash.
Activity for MEUs in 2010 and 2009 was as follows (in thousands):
Units
Weighted-Average
Grant Date
Fair Value Units
Weighted-Average
Grant Date
Fair Value
January 30, 2011 January 31, 2010
Year Ended
Nonvested at beginning of year ...... 255 $25.75 — $ —
Granted ........................ 248 $40.17 285 $25.75
Vested ......................... — $ — — $ —
Forfeited ....................... (53) $40.17 (30) $25.75
Nonvested at end of year ........... 450 $40.17 255 $25.75
Employee Stock Purchase Plan
We have an Employee Stock Purchase Plan, or “ESPP,” that allows essentially all employees who meet certain
service requirements to purchase our common stock on semi-annual offering dates at a discount. Prior to February 2,
2009, the ESPP allowed employees to purchase shares at 85% of the fair market value of the shares on the offering
date or, if lower, at 85% of the fair market value of the shares on the purchase date. Effective February 2, 2009, the
discount rate changed to 5%, allowing participants to purchase our common stock on semi-annual offering dates at
95% of the fair market value of the shares on the purchase date. A maximum of 4.0 million shares is authorized for
F-22
PetSmart, Inc. and Subsidiaries
Notes to Consolidated Financial Statements — (Continued)