exv10w18



 










Exhibit 10.18




NONSTATUTORY STOCK OPTION




	 	 	 
	Optionee:

	 	«First_Name» «Mid» «Last_Name»
	

	 	«Position»
	

	 	Location: «Depart»







     On «Grant_Date» (the “Grant Date”) PETsMART, Inc. (the “Company”),
pursuant to its 1997 Equity Incentive Plan (the “Plan”), granted to you, the
Optionee named above, an option to purchase shares of the common stock of the
Company (“Common Stock”). This option is not intended to qualify and will not
be treated as an “incentive stock option” within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”).



     The grant hereunder is in connection with and in furtherance of the
Company’s compensatory benefit plan for participation of the Company’s (and its
Affiliates’ as defined in the Plan) employees (including officers), directors
or consultants and is subject to the terms and conditions of the Plan. In the
event that this option is granted to you in connection with the performance of
services as a consultant or director (or you later become a consultant or
director), references to employment, employee and similar terms shall be deemed
to include the performance of services as a consultant or a director, as the
case may be, provided, however, that no rights as an employee shall arise by
reason of the use of such terms. Any reference to employment with the Company
shall also refer to employment with an Affiliate, as appropriate.



     The details of your option are as follows:



     1. The total number of shares of Common Stock subject to this option is
«Issued». The vesting commencement date for this option is «Begin». Subject to
the limitations contained herein and as otherwise provided for herein, shares
subject to this option shall become exercisable twenty-five percent (25%) per
year for four (4) years commencing one (1) year after the vesting commencement
date and on each anniversary thereafter, unless you cease to be employed by the
Company for any reason prior to any such anniversary date.



     2. (a) The exercise price of this option is $«Price» per share, provided
however, that the exercise price shall not be less than the Fair Market Value
(as defined in the Plan) of the Common Stock on the date of grant of this
option.



          (b) Payment of the exercise price per share is due in full upon exercise
of all or any part of each installment, which has accrued to you. The Company
may require you, to the extent permitted by applicable statutes and
regulations, to make payment of the exercise price under one of the following
alternatives:



               (i) Payment of the exercise price per share in cash (including check) at
the time of exercise;



               (ii) Payment pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board which results in the receipt of cash
(or check) by the Company prior to the issuance of Common Stock;



               (iii) Provided that at the time of exercise of your option the Common
Stock is publicly traded and quoted regularly in The Wall Street Journal, by
delivery of already-owned shares of Common Stock that have a Fair Market Value
(as defined in the Plan) on the date of exercise equal to the exercise price
and that qualify as Permitted Shares. For the purposes of the foregoing,
“Permitted Shares” shall mean shares of Common Stock that are owned free and
clear of any liens, claims, encumbrances or security interests and that either
(x) you have held for the period required to avoid a charge to the Company’s
reported earnings or (y) you did not acquire, directly or indirectly from the
Company. “Delivery” for these purposes, in the sole discretion of the Company
at the time you exercise your option, shall include delivery to the Company of
your attestation of ownership of such shares of Common Stock in a form approved
by the Company. Notwithstanding the foregoing, you may not exercise your
option by tender to the Company of Common Stock to the extent such tender would
violate the provisions of any law, regulation or agreement restricting the
redemption of the Company’s stock; or



1









 





               (iv) Payment by a combination of the methods of payment permitted by
subparagraph 2(b)(i) through 2(b)(iii) above.



     3. This option may not be exercised for any number of shares, which would
require the issuance of anything other than whole shares.



     4. Notwithstanding anything to the contrary contained herein, this option
may not be exercised unless the shares issuable upon exercise of this option
are then registered under the Securities Act of 1933, as amended (the
“Securities Act”), or, if such shares are not then so registered, the Company
has determined that such exercise and issuance would be exempt from the
registration requirements of the Securities Act. The exercise of your option
must also comply with other applicable laws and regulations governing your
option, and you may not exercise your option if the Company determines that
such exercise would not be in material compliance with such laws and
regulations.



     5. The term of this option commences on the Grant Date and, unless sooner
terminated as set forth below or in the Plan, terminates on the date (the
“Fixed Termination Date”) which shall be the earlier of «End_Date» or ten (10)
years from the Grant Date. In no event may this option be exercised on or
after the Fixed Termination Date. This option shall terminate prior to the
Fixed Termination Date on the date that is three (3) months after the
termination of your employment with the Company for any reason or for no reason
unless:



          (a) such termination of employment is due to disability (as defined in the
Plan), in which event the option shall terminate on the earlier of the Fixed
Termination Date or twelve (12) months following such termination of
employment; or



          (b) such termination of employment is due to your death, in which event
the option shall terminate on the earlier of the Fixed Termination Date or
eighteen (18) months after your death; or



          (c) during any part of such three (3) month period the option is not
exercisable solely because of the condition set forth in paragraph 4 above, in
which event the option shall not terminate until the earlier of the Fixed
Termination Date or until it shall have been exercisable for an aggregate
period of three (3) months after such termination of employment; or



          (d) exercise of the option within three (3) months after such termination
of employment would result in liability under Section 16(b) of the Securities
Exchange Act of 1934, in which case the option will terminate on the earlier of
(i) the Fixed Termination Date, (ii) the tenth (10th) day after the last date
upon which exercise would result in such liability or (iii) six (6) months and
ten (10) days after such termination of employment.



          However, this option may be exercised following such termination of
employment only as to that number of shares as to which it was exercisable on
the date of such termination of employment under the provisions of paragraph 1
of this option.



     6. (a) This option may be exercised, to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other
person as the Company may designate, during regular business hours, together
with such additional documents as the Company may then require pursuant to
Section 11 of the Plan.



          (b) By exercising this option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of: (1) the exercise of
this option; (2) the lapse of any substantial risk of forfeiture to which the
shares are subject at the time of exercise; or (3) the disposition of shares
acquired upon such exercise. You may not exercise your option unless the tax
withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when desired even
though your option is vested, and the Company shall have no obligation to issue
a certificate for such shares of Common Stock. In the Company’s sole
discretion, subject only to compliance with any applicable conditions or
restrictions of law, the Company may require you to satisfy your obligations as
set forth in this subparagraph 6(b) by one or more of the following:



2









 





               (i) Payment by you to the Company of cash.



               (ii) Withholding from payroll or any other amounts payable to
you.



               (iii) Pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board often referred to as a “cashless exercise program” or
a “same day sale program.”



               (iv) Withholding from fully vested shares of Common Stock otherwise
issuable to you upon the exercise of your option a number of whole shares of
Common Stock having a Fair Market Value, as determined by the Company, that is
not in excess of the minimum amount of tax required to be withheld by law. If
the date of determination of any tax withholding obligation is deferred to a
date later than the date of exercise of your option, you agree to review with
your own tax advisors the federal, state, local and foreign tax consequences of
the exercise. You will rely solely on your own advisors and not on any
statements or representations of the Company or any of its agents for advice
regarding, without limitation, whether and when to exercise your option and
whether to make a proper and timely election under Section 83(b) of the Code to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares
of Common Stock shall be withheld solely from fully vested shares of Common
Stock determined as of the date of exercise of your option that are otherwise
issuable to you upon such exercise. Any adverse consequences to you arising in
connection with such share withholding procedure shall be your sole
responsibility.



     7. This option is not transferable, except by will or by the laws of
descent and distribution or pursuant to a qualified domestic relations order as
defined in the Code or Title I of the Employee Retirement Income Security Act
(a “QDRO”), and is exercisable during your life only by you or a transferee
pursuant to a QDRO. By delivering written notice to the Company, in a form
satisfactory to the Company, you may designate a third party who, in the event
of your death, shall thereafter be entitled to exercise this option.



     8. This option is not an employment or other service contract and nothing
in this option shall be deemed to create in any way whatsoever any obligation
on your part to continue in the employ or other service of the Company, or of
the Company to continue your employment or other service with the Company.



     9. Any notices provided for in your option or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the address specified
below or at such other address as you hereafter designate by written notice to
the Company.



     10. Your option is subject to all the provisions of the Plan, a copy of
which is attached hereto, and its provisions are hereby made a part of your
option, including without limitation the provisions of Section 6 of the Plan
relating to option provisions. Your option is further subject to all
interpretations, amendments, rules and regulations, which may from time to time
be promulgated and adopted pursuant to the Plan. In the event of any conflict
between the provisions of your option and those of the Plan, the provisions of
the Plan shall control.



     11. You have thirty (30) days from the receipt by you of this Agreement to
notify the Company of any issues you have with the terms and conditions of this
option grant including the terms and conditions of this Agreement or the Plan.
If you do not notify the Company of any such issues or errors within such
thirty (30) day period, you will be deemed to have agreed to the terms and
conditions of this option grant.



     12. This Agreement, the Plan, any written agreements with the Company and
any other equity compensation plan adopted or approved by the Board of
Directors or the Compensation Committee of the Company shall constitute the
complete and exclusive agreement between the parties regarding the subject
matter hereof. No modification or amendment of this Agreement or waiver of any
rights hereunder shall be valid unless in writing and duly signed by a party
authorized by each party hereto.



     Dated effective as of the Grant Date.



Very truly yours,




PETsMART, Inc.




3









 








	 	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	Duly authorized on behalf
	

	 	 	 	of the Board of Directors







Attachments:





	 	 	PETsMART, Inc 1997 Equity Incentive Plan

PETsMART, Inc.1997 Equity Incentive Plan Prospectus




4









 











NONSTATUTORY STOCK OPTION

(Stock Option Allowing for Transferability)




	 	 	 
	Optionee:

	 	«First_Name» «Mid» «Last_Name»
	

	 	«Position»
	

	 	Department: «Depart»







     On «Grant_Date» (the “Grant Date”) PETsMART, Inc. (the “Company”),
pursuant to its 1997 Equity Incentive Plan (the “Plan”), granted to you, the
Optionee named above, an option to purchase shares of the common stock of the
Company (“Common Stock”). This option is not intended to qualify and will not
be treated as an “incentive stock option” within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”).



     The grant hereunder is in connection with and in furtherance of the
Company’s compensatory benefit plan for participation of the Company’s (and its
Affiliates’ as defined in the Plan) employees (including officers), directors
or consultants and is subject to the terms and conditions of the Plan. In the
event that this option is granted to you in connection with the performance of
services as a consultant or director (or you later become a consultant or
director), references to employment, employee and similar terms shall be deemed
to include the performance of services as a consultant or a director, as the
case may be, provided, however, that no rights as an employee shall arise by
reason of the use of such terms. Any reference to employment with the Company
shall also refer to employment with an Affiliate, as appropriate.



     The details of your option are as follows:



     1. The total number of shares of Common Stock subject to this option is
«Issued». The vesting commencement date for this option is «Begin». Subject to
the limitations contained herein and as otherwise provided for herein, shares
subject to this option shall become exercisable twenty-five percent (25%) per
year for four (4) years commencing one (1) year after the vesting commencement
date and on each anniversary thereafter, unless you cease to be employed by the
Company for any reason prior to any such anniversary date.



     2. (a) The exercise price of this option is $«Price» per share, provided
however, that the exercise price shall not be less than the Fair Market Value
(as defined in the Plan) of the Common Stock on the date of grant of this
option.



          (b) Payment of the exercise price per share is due in full upon exercise
of all or any part of each installment, which has accrued to you. The Company
may require you, to the extent permitted by applicable statutes and
regulations, to make payment of the exercise price under one of the following
alternatives:



               (i) Payment of the exercise price per share in cash (including check) at
the time of exercise;



               (ii) Payment pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board which results in the receipt of cash
(or check) by the Company prior to the issuance of Common Stock;



               (iii) Provided that at the time of exercise of your option the Common
Stock is publicly traded and quoted regularly in The Wall Street Journal, by
delivery of already-owned shares of Common Stock that have a Fair Market Value
(as defined in the Plan) on the date of exercise equal to the exercise price
and that qualify as Permitted Shares. For the purposes of the foregoing,
“Permitted Shares” shall mean shares of Common Stock that are owned free and
clear of any liens, claims, encumbrances or security interests and that either
(x) you have held for the period required to avoid a charge to the Company’s
reported earnings or (y) you did not acquire, directly or indirectly from the
Company. “Delivery” for these purposes, in the sole discretion of the Company
at the time you exercise your option, shall include delivery to the Company of
your attestation of ownership of such shares of Common Stock in a form approved
by the Company. Notwithstanding the foregoing, you may not exercise your
option by tender to the Company of Common Stock to the extent such tender would
violate the provisions of any law, regulation or agreement restricting the
redemption of the Company’s stock; or



               (iv) Payment by a combination of the methods of payment permitted by
subparagraph 2(b)(i) through 2(b)(iii) above.



5









 





     3. This option may not be exercised for any number of shares, which would
require the issuance of anything other than whole shares.



     4. Notwithstanding anything to the contrary contained herein, this option
may not be exercised unless the shares issuable upon exercise of this option
are then registered under the Securities Act of 1933, as amended (the
“Securities Act”), or, if such shares are not then so registered, the Company
has determined that such exercise and issuance would be exempt from the
registration requirements of the Securities Act. The exercise of your option
must also comply with other applicable laws and regulations governing your
option, and you may not exercise your option if the Company determines that
such exercise would not be in material compliance with such laws and
regulations.



     5. The term of this option commences on the Grant Date and, unless sooner
terminated as set forth below or in the Plan, terminates on the date (the
“Fixed Termination Date”) which shall be the earlier of «End_Date» or ten (10)
years from the Grant Date. In no event may this option be exercised on or
after the Fixed Termination Date. This option shall terminate prior to the
Fixed Termination Date on the date that is three (3) months after the
termination of your employment with the Company for any reason or for no reason
unless:



          (a) such termination of employment is due disability (as defined in the
Plan), in which event the option shall terminate on the earlier of the Fixed
Termination Date or twelve (12) months following such termination of
employment; or



          (b) such termination of employment is due to your death, in which event
the option shall terminate on the earlier of the Fixed Termination Date or
eighteen (18) months after your death; or



          (c) during any part of such three (3) month period the option is not
exercisable solely because of the condition set forth in paragraph 4 above, in
which event the option shall not terminate until the earlier of the Fixed
Termination Date or until it shall have been exercisable for an aggregate
period of three (3) months after such termination of employment; or



          (d) exercise of the option within three (3) months after such termination
of employment would result in liability under Section 16(b) of the Securities
Exchange Act of 1934, in which case the option will terminate on the earlier of
(i) the Fixed Termination Date, (ii) the tenth (10th) day after the last date
upon which exercise would result in such liability or (iii) six (6) months and
ten (10) days after such termination of employment.



          However, this option may be exercised following such termination of
employment only as to that number of shares as to which it was exercisable on
the date of such termination of employment under the provisions of paragraph 1
of this option.



     6. (a) This option may be exercised, to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other
person as the Company may designate, during regular business hours, together
with such additional documents as the Company may then require pursuant to
Section 11 of the Plan.



          (b) By exercising this option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of: (1) the exercise of
this option; (2) the lapse of any substantial risk of forfeiture to which the
shares are subject at the time of exercise; or (3) the disposition of shares
acquired upon such exercise. You may not exercise your option unless the tax
withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when desired even
though your option is vested, and the Company shall have no obligation to issue
a certificate for such shares of Common Stock. In the Company’s sole
discretion, subject only to compliance with any applicable conditions or
restrictions of law, the Company may require you to satisfy your obligations as
set forth in this subparagraph 6(b) by one or more of the following:



               (i) Payment by you to the Company of cash.



6









 





               (ii) Withholding from payroll or any other amounts payable to
you.



               (iii) Pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board often referred to as a “cashless exercise program” or
a “same day sale program.”



               (iv) Withholding from fully vested shares of Common Stock otherwise
issuable to you upon the exercise of your option a number of whole shares of
Common Stock having a Fair Market Value, as determined by the Company, that is
not in excess of the minimum amount of tax required to be withheld by law. If
the date of determination of any tax withholding obligation is deferred to a
date later than the date of exercise of your option, you agree to review with
your own tax advisors the federal, state, local and foreign tax consequences of
the exercise. You will rely solely on your own advisors and not on any
statements or representations of the Company or any of its agents for advice
regarding, without limitation, whether and when to exercise your option and
whether to make a proper and timely election under Section 83(b) of the Code to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares
of Common Stock shall be withheld solely from fully vested shares of Common
Stock determined as of the date of exercise of your option that are otherwise
issuable to you upon such exercise. Any adverse consequences to you arising in
connection with such share withholding procedure shall be your sole
responsibility.



     7. This option is not transferable, except (i) by will or by the laws of
descent and distribution, (ii) with the prior written approval of the Company,
by instrument to an inter vivos or testamentary trust, in a form accepted by
the Company, in which the option is to be passed to beneficiaries upon death of
the trustor (settlor) and (iii) with the prior written approval of the Company,
by gift, in a form accepted by the Company, to your “immediate family” as
defined in 17 C.F.R. 240.16a-1(e). The term “immediate family” is defined in
17 C.F.R. 240.16a-1(e) to mean any child, stepchild, parent, stepparent,
grantparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, sister-in-law, and includes adoptive
relationships. Your option is exercisable during your life only by you or a
transferee satisfying the above-stated conditions. The right of a transferee
to exercise the transferred portion of your option after termination of your
Continuous Status as an Employee, Director or Consultant shall terminate in
accordance with your right to exercise your option as specified in your option.
In the event that your Continuous Status as an Employee, Director, or
Consultant terminates due to your death, your transferee will be treated as a
person who acquired the right to exercise your options by bequest or
inheritance. In addition to the forgoing, the Company may require, as a
condition of the transfer of your option to a trust or by gift, that your
transferee enter into an option transfer agreement provided by, or acceptable
to, the Company. Notwithstanding the foregoing, if you have not transferred
the option prior to your death, by delivering written notice to the Company in
a form satisfactory to the Company, you may designate a third party who, in the
event of your death, shall thereafter be entitled to exercise your option.



     8. This option is not an employment or other service contract and nothing
in this option shall be deemed to create in any way whatsoever any obligation
on your part to continue in the employ or other service of the Company, or of
the Company to continue your employment or other service with the Company.



     9. Any notices provided for in your option or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the address specified
below or at such other address as you hereafter designate by written notice to
the Company.



     10. Your option is subject to all the provisions of the Plan, a copy of
which is attached hereto, and its provisions are hereby made a part of your
option, including without limitation the provisions of Section 6 of the Plan
relating to option provisions. Your option is further subject to all
interpretations, amendments, rules and regulations, which may from time to time
be promulgated and adopted pursuant to the Plan. In the event of any conflict
between the provisions of your option and those of the Plan, the provisions of
the Plan shall control.



     11. You have thirty (30) days from the receipt by you of this Agreement to
notify the Company of any issues you have with the terms and conditions of this
option grant including the terms and conditions of this Agreement or the Plan.
If you do not notify the Company of any such issues or errors within such
thirty (30) day period, you will be deemed to have agreed to the terms and
conditions of this option grant.



     12. This Agreement, the Plan, any written agreements with the
Company and any other equity compensation plan adopted or approved by the Board
of Directors or the Compensation Committee of the Company shall constitute the
complete and exclusive agreement between the parties regarding the subject
matter hereof. No



7









 




modification or amendment of this Agreement or waiver of any rights
hereunder shall be valid unless in writing and duly signed by a party
authorized by each party hereto.




     Dated effective as of the Grant Date.



	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	PETsMART, Inc.
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	Duly authorized on behalf
	

	 	 	 	of the Board of Directors







Attachments:





	 	 	PETsMART, Inc. 1997 Equity Incentive Plan

PETsMART, Inc. 1997 Equity Incentive Plan Prospectus




8









 











NONSTATUTORY STOCK OPTION




	 	 	 
	Optionee:

	 	«First_Name» «Mid» «Last_Name»
	

	 	«Position»
	

	 	Department: «Depart»







     On «Grant_Date» (the “Grant Date”) PETsMART, Inc. (the “Company”),
pursuant to its 2003 Equity Incentive Plan (the “Plan”), granted to you, the
Optionee named above, an option to purchase shares of the common stock of the
Company (“Common Stock”). This option is not intended to qualify and will not
be treated as an “incentive stock option” within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”).



     The grant hereunder is in connection with and in furtherance of the
Company’s compensatory benefit plan for participation of the Company’s (and its
Affiliates’ as defined in the Plan) employees (including officers), directors
or consultants and is subject to the terms and conditions of the Plan. In the
event that this option is granted to you in connection with the performance of
services as a consultant or director (or you later become a consultant or
director), references to employment, employee and similar terms shall be deemed
to include the performance of services as a consultant or a director, as the
case may be, provided, however, that no rights as an employee shall arise by
reason of the use of such terms. Any reference to employment with the Company
shall also refer to employment with an Affiliate, as appropriate.



     The details of your option are as follows:



     1. The total number of shares of Common Stock subject to this option is
«Issued». The vesting commencement date for this option is «Vest_Date». Subject
to the limitations contained herein and as otherwise provided for herein,
shares subject to this option shall become exercisable twenty-five percent
(25%) per year for four (4) years commencing one (1) year after the vesting
commencement date and on each anniversary thereafter, unless you cease to be
employed by the Company for any reason prior to any such anniversary date.



     2. (a) The exercise price of this option is $«Price» per share, provided
however, that the exercise price shall not be less than the Fair Market Value
(as defined in the Plan) of the Common Stock on the date of grant of this
option.



          (b) Payment of the exercise price per share is due in full upon exercise
of all or any part of each installment, which has accrued to you. The Company
may require you, to the extent permitted by applicable statutes and
regulations, to make payment of the exercise price under one of the following
alternatives:



               (i) Payment of the exercise price per share in cash (including check) at
the time of exercise;



               (ii) Payment pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board which results in the receipt of cash
(or check) by the Company prior to the issuance of Common Stock;



               (iii) Provided that at the time of exercise of your option the Common
Stock is publicly traded and quoted regularly in The Wall Street Journal, by
delivery of already-owned shares of Common Stock that have a Fair Market Value
(as defined in the Plan) on the date of exercise equal to the exercise price
and that qualify as Permitted Shares. For the purposes of the foregoing,
“Permitted Shares” shall mean shares of Common Stock that are owned free and
clear of any liens, claims, encumbrances or security interests and that either
(x) you have held for the period required to avoid a charge to the Company’s
reported earnings or (y) you did not acquire, directly or indirectly from the
Company. “Delivery” for these purposes, in the sole discretion of the Company
at the time you exercise your option, shall include delivery to the Company of
your attestation of ownership of such shares of Common Stock in a form approved
by the Company. Notwithstanding the foregoing, you may not exercise your
option by tender to the Company of Common Stock to the extent such tender would
violate the provisions of any law, regulation or agreement restricting the
redemption of the Company’s stock; or



               (iv) Payment by a combination of the methods of payment permitted by
subparagraph 2(b)(i) through 2(b)(iii) above.



9









 





     3. This option may not be exercised for any number of shares, which would
require the issuance of anything other than whole shares.



     4. Notwithstanding anything to the contrary contained herein, this option
may not be exercised unless the shares issuable upon exercise of this option
are then registered under the Securities Act of 1933, as amended (the
“Securities Act”), or, if such shares are not then so registered, the Company
has determined that such exercise and issuance would be exempt from the
registration requirements of the Securities Act. The exercise of your option
must also comply with other applicable laws and regulations governing your
option, and you may not exercise your option if the Company determines that
such exercise would not be in material compliance with such laws and
regulations.



     5. The term of this option commences on the Grant Date and, unless sooner
terminated as set forth below or in the Plan, terminates on the date (the
“Fixed Termination Date”) which shall be the earlier of «End_Date» or ten (10)
years from the Grant Date. In no event may this option be exercised on or
after the Fixed Termination Date. This option shall terminate prior to the
Fixed Termination Date on the date that is three (3) months after the
termination of your employment with the Company for any reason or for no reason
unless:



          (a) such termination of employment is due to permanent and total
disability (within the meaning of Section 422(c)(6) of the Code), in which
event the option shall terminate on the earlier of the Fixed Termination Date
or twelve (12) months following such termination of employment; or



          (b) such termination of employment is due to your death, in which event
the option shall terminate on the earlier of the Fixed Termination Date or
eighteen (18) months after your death; or



          (c) during any part of such three (3) month period the option is not
exercisable solely because of the condition set forth in paragraph 4 above, in
which event the option shall not terminate until the earlier of the Fixed
Termination Date or until it shall have been exercisable for an aggregate
period of three (3) months after such termination of employment; or



          (d) exercise of the option within three (3) months after such termination
of employment would result in liability under Section 16(b) of the Securities
Exchange Act of 1934, in which case the option will terminate on the earlier of
(i) the Fixed Termination Date, (ii) the tenth (10th) day after the last date
upon which exercise would result in such liability or (iii) six (6) months and
ten (10) days after such termination of employment.



          However, this option may be exercised following such termination of
employment only as to that number of shares as to which it was exercisable on
the date of such termination of employment under the provisions of paragraph 1
of this option.



     6. (a) This option may be exercised, to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other
person as the Company may designate, during regular business hours, together
with such additional documents as the Company may then require pursuant to
Section 12 of the Plan.



          (b) By exercising this option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of: (1) the exercise of
this option; (2) the lapse of any substantial risk of forfeiture to which the
shares are subject at the time of exercise; or (3) the disposition of shares
acquired upon such exercise. You may not exercise your option unless the tax
withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when desired even
though your option is vested, and the Company shall have no obligation to issue
a certificate for such shares of Common Stock. In the Company’s sole
discretion, subject only to compliance with any applicable conditions or
restrictions of law, the Company may require you to satisfy your obligations as
set forth in this subparagraph 6(b) by one or more of the following:



               (i) Payment by you to the Company of cash.



               (ii) Withholding from payroll or any other amounts payable to
you.



10









 





               (iii) Pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board often referred to as a “cashless exercise program” or
a “same day sale program.”



               (iv) Withholding from fully vested shares of Common Stock otherwise
issuable to you upon the exercise of your option a number of whole shares of
Common Stock having a Fair Market Value, as determined by the Company, that is
not in excess of the minimum amount of tax required to be withheld by law. If
the date of determination of any tax withholding obligation is deferred to a
date later than the date of exercise of your option, you agree to review with
your own tax advisors the federal, state, local and foreign tax consequences of
the exercise. You will rely solely on your own advisors and not on any
statements or representations of the Company or any of its agents for advice
regarding, without limitation, whether and when to exercise your option and
whether to make a proper and timely election under Section 83(b) of the Code to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares
of Common Stock shall be withheld solely from fully vested shares of Common
Stock determined as of the date of exercise of your option that are otherwise
issuable to you upon such exercise. Any adverse consequences to you arising in
connection with such share withholding procedure shall be your sole
responsibility.



     7. This option is not transferable, except by will or by the laws of
descent and distribution or pursuant to a qualified domestic relations order as
defined in the Code or Title I of the Employee Retirement Income Security Act
(a “QDRO”), and is exercisable during your life only by you or a transferee
pursuant to a QDRO. By delivering written notice to the Company, in a form
satisfactory to the Company, you may designate a third party who, in the event
of your death, shall thereafter be entitled to exercise this option.



     8. This option is not an employment or other service contract and nothing
in this option shall be deemed to create in any way whatsoever any obligation
on your part to continue in the employ or other service of the Company, or of
the Company to continue your employment or other service with the Company.



     9. Any notices provided for in your option or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the address specified
below or at such other address as you hereafter designate by written notice to
the Company.



     10. Your option is subject to all the provisions of the Plan, a copy of
which is attached hereto, and its provisions are hereby made a part of your
option, including without limitation the provisions of Section 6 of the Plan
relating to option provisions. Your option is further subject to all
interpretations, amendments, rules and regulations, which may from time to time
be promulgated and adopted pursuant to the Plan. In the event of any conflict
between the provisions of your option and those of the Plan, the provisions of
the Plan shall control.



     11. You have thirty (30) days from the receipt by you of this Agreement to
notify the Company of any issues you have with the terms and conditions of this
option grant including the terms and conditions of this Agreement or the Plan.
If you do not notify the Company of any such issues or errors within such
thirty (30) day period, you will be deemed to have agreed to the terms and
conditions of this option grant.



     12. This Agreement, the Plan, any written agreements with the Company and
any other equity compensation plan adopted or approved by the Board of
Directors or the Compensation Committee of the Company shall constitute the
complete and exclusive agreement between the parties regarding the subject
matter hereof. No modification or amendment of this Agreement or waiver of any
rights hereunder shall be valid unless in writing and duly signed by a party
authorized by each party hereto.



     Dated effective as of the Grant Date.



Very truly yours,




PETsMART, Inc.




11









 








	 	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	Duly authorized on behalf
	

	 	 	 	of the Board of Directors







Attachments:





	 	 	PETsMART, Inc. 2003 Equity Incentive Plan

PETsMART, Inc. 2003 Equity Incentive Plan Prospectus




12









 











NONSTATUTORY STOCK OPTION

(Stock Option Allowing for Transferability)




	 	 	 
	Optionee:

	 	«First_Name» «Mid» «Last_Name»
	

	 	«Position»
	

	 	Department: «Depart»







     On «Grant_Date» (the “Grant Date”) PETsMART, Inc. (the “Company”),
pursuant to its 2003 Equity Incentive Plan (the “Plan”), granted to you, the
Optionee named above, an option to purchase shares of the common stock of the
Company (“Common Stock”). This option is not intended to qualify and will not
be treated as an “incentive stock option” within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”).



     The grant hereunder is in connection with and in furtherance of the
Company’s compensatory benefit plan for participation of the Company’s (and its
Affiliates’ as defined in the Plan) employees (including officers), directors
or consultants and is subject to the terms and conditions of the Plan. In the
event that this option is granted to you in connection with the performance of
services as a consultant or director (or you later become a consultant or
director), references to employment, employee and similar terms shall be deemed
to include the performance of services as a consultant or a director, as the
case may be, provided, however, that no rights as an employee shall arise by
reason of the use of such terms. Any reference to employment with the Company
shall also refer to employment with an Affiliate, as appropriate.



     The details of your option are as follows:



     1. The total number of shares of Common Stock subject to this option is
«Issued». The vesting commencement date for this option is «Begin». Subject to
the limitations contained herein and as otherwise provided for herein, shares
subject to this option shall become exercisable twenty-five percent (25%) per
year for four (4) years commencing one (1) year after the vesting commencement
date and on each anniversary thereafter, unless you cease to be employed by the
Company for any reason prior to any such anniversary date.



     2. (a) The exercise price of this option is «Price» per share, provided
however, that the exercise price shall not be less than the Fair Market Value
(as defined in the Plan) of the Common Stock on the date of grant of this
option.



          (b) Payment of the exercise price per share is due in full upon exercise
of all or any part of each installment, which has accrued to you. The Company
may require you, to the extent permitted by applicable statutes and
regulations, to make payment of the exercise price under one of the following
alternatives:



                    (i) Payment of the exercise price per share in cash (including check) at
the time of exercise;



                    (ii) Payment pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board which results in the receipt of cash
(or check) by the Company prior to the issuance of Common Stock;



                    (iii) Provided that at the time of exercise of your option the Common
Stock is publicly traded and quoted regularly in The Wall Street Journal, by
delivery of already-owned shares of Common Stock that have a Fair Market Value
(as defined in the Plan) on the date of exercise equal to the exercise price
and that qualify as Permitted Shares. For the purposes of the foregoing,
“Permitted Shares” shall mean shares of Common Stock that are owned free and
clear of any liens, claims, encumbrances or security interests and that either
(x) you have held for the period required to avoid a charge to the Company’s
reported earnings or (y) you did not acquire, directly or indirectly from the
Company. “Delivery” for these purposes, in the sole discretion of the Company
at the time you exercise your option, shall include delivery to the Company of
your attestation of ownership of such shares of Common Stock in a form approved
by the Company. Notwithstanding the foregoing, you may not exercise your
option by tender to the Company of Common Stock to the extent such tender would
violate the provisions of any law, regulation or agreement restricting the
redemption of the Company’s stock; or



13









 





                    (iv) Payment by a combination of the methods of payment permitted by
subparagraph 2(b)(i) through 2(b)(iii) above.



     3. This option may not be exercised for any number of shares, which would
require the issuance of anything other than whole shares.



     4. Notwithstanding anything to the contrary contained herein, this option
may not be exercised unless the shares issuable upon exercise of this option
are then registered under the Securities Act of 1933, as amended (the
“Securities Act”), or, if such shares are not then so registered, the Company
has determined that such exercise and issuance would be exempt from the
registration requirements of the Securities Act. The exercise of your option
must also comply with other applicable laws and regulations governing your
option, and you may not exercise your option if the Company determines that
such exercise would not be in material compliance with such laws and
regulations.



     5. The term of this option commences on the Grant Date and, unless sooner
terminated as set forth below or in the Plan, terminates on the date (the
“Fixed Termination Date”) which shall be the earlier of «End_Date» or ten (10)
years from the Grant Date. In no event may this option be exercised on or
after the Fixed Termination Date. This option shall terminate prior to the
Fixed Termination Date on the date that is three (3) months after the
termination of your employment with the Company for any reason or for no reason
unless:



          (a) such termination of employment is due to your permanent and total
disability (within the meaning of Section 422(c)(6) of the Code), in which
event the option shall terminate on the earlier of the Fixed Termination Date
or twelve (12) months following such termination of employment; or



          (b) such termination of employment is due to your death, in which event
the option shall terminate on the earlier of the Fixed Termination Date or
eighteen (18) months after your death; or



          (c) during any part of such three (3) month period the option is not
exercisable solely because of the condition set forth in paragraph 4 above, in
which event the option shall not terminate until the earlier of the Fixed
Termination Date or until it shall have been exercisable for an aggregate
period of three (3) months after such termination of employment; or



          (d) exercise of the option within three (3) months after such termination
of employment would result in liability under Section 16(b) of the Securities
Exchange Act of 1934, in which case the option will terminate on the earlier of
(i) the Fixed Termination Date, (ii) the tenth (10th) day after the last date
upon which exercise would result in such liability or (iii) six (6) months and
ten (10) days after such termination of employment.



          However, this option may be exercised following such termination of
employment only as to that number of shares as to which it was exercisable on
the date of such termination of employment under the provisions of paragraph 1
of this option.



     6. (a) This option may be exercised, to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other
person as the Company may designate, during regular business hours, together
with such additional documents as the Company may then require pursuant to
Section 12 of the Plan.



          (b) By exercising this option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of: (1) the exercise of
this option; (2) the lapse of any substantial risk of forfeiture to which the
shares are subject at the time of exercise; or (3) the disposition of shares
acquired upon such exercise. You may not exercise your option unless the tax
withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when desired even
though your option is vested, and the Company shall have no obligation to issue
a certificate for such shares of Common Stock. In the Company’s sole
discretion, subject only to compliance with any applicable conditions or
restrictions of law, the Company may require you to satisfy your obligations as
set forth in this subparagraph 6(b) by one or more of the following:



                    (i) Payment by you to the Company of cash.



14









 





                    (ii) Withholding from payroll or any other amounts payable to
you.



                    (iii) Pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board often referred to as a “cashless exercise program” or
a “same day sale program.”



                    (iv) Withholding from fully vested shares of Common Stock otherwise
issuable to you upon the exercise of your option a number of whole shares of
Common Stock having a Fair Market Value, as determined by the Company, that is
not in excess of the minimum amount of tax required to be withheld by law. If
the date of determination of any tax withholding obligation is deferred to a
date later than the date of exercise of your option, you agree to review with
your own tax advisors the federal, state, local and foreign tax consequences of
the exercise. You will rely solely on your own advisors and not on any
statements or representations of the Company or any of its agents for advice
regarding, without limitation, whether and when to exercise your option and
whether to make a proper and timely election under Section 83(b) of the Code to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares
of Common Stock shall be withheld solely from fully vested shares of Common
Stock determined as of the date of exercise of your option that are otherwise
issuable to you upon such exercise. Any adverse consequences to you arising in
connection with such share withholding procedure shall be your sole
responsibility.



     7. This option is not transferable, except (i) by will or by the laws of
descent and distribution, (ii) with the prior written approval of the Company,
by instrument to an inter vivos or testamentary trust, in a form accepted by
the Company, in which the option is to be passed to beneficiaries upon death of
the trustor (settlor) and (iii) with the prior written approval of the Company,
by gift, in a form accepted by the Company, to your “immediate family” as
defined in 17 C.F.R. 240.16a-1(e). The term “immediate family” is defined in
17 C.F.R. 240.16a-1(e) to mean any child, stepchild, parent, stepparent,
grantparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, sister-in-law, and includes adoptive
relationships. Your option is exercisable during your life only by you or a
transferee satisfying the above-stated conditions. The right of a transferee
to exercise the transferred portion of your option after termination of your
Continuous Status as an Employee, Director or Consultant shall terminate in
accordance with your right to exercise your option as specified in your option.
In the event that your Continuous Status as an Employee, Director, or
Consultant terminates due to your death, your transferee will be treated as a
person who acquired the right to exercise your options by bequest or
inheritance. In addition to the forgoing, the Company may require, as a
condition of the transfer of your option to a trust or by gift, that your
transferee enter into an option transfer agreement provided by, or acceptable
to, the Company. Notwithstanding the foregoing, if you have not transferred
the option prior to your death, by delivering written notice to the Company in
a form satisfactory to the Company, you may designate a third party who, in the
event of your death, shall thereafter be entitled to exercise your option.



     8. This option is not an employment or other service contract and nothing
in this option shall be deemed to create in any way whatsoever any obligation
on your part to continue in the employ or other service of the Company, or of
the Company to continue your employment or other service with the Company.



     9. Any notices provided for in your option or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the address specified
below or at such other address as you hereafter designate by written notice to
the Company.



     10. Your option is subject to all the provisions of the Plan, a copy of
which is attached hereto, and its provisions are hereby made a part of your
option, including without limitation the provisions of Section 6 of the Plan
relating to option provisions. Your option is further subject to all
interpretations, amendments, rules and regulations, which may from time to time
be promulgated and adopted pursuant to the Plan. In the event of any conflict
between the provisions of your option and those of the Plan, the provisions of
the Plan shall control.



     11. You have thirty (30) days from the receipt by you of this Agreement to
notify the Company of any issues you have with the terms and conditions of this
option grant including the terms and conditions of this Agreement or the Plan.
If you do not notify the Company of any such issues or errors within such
thirty (30) day period, you will be deemed to have agreed to the terms and
conditions of this option grant.



     12. This Agreement, the Plan, any written agreements with the Company and
any other equity compensation plan adopted or approved by the Board of
Directors or the Compensation Committee of the Company



15









 




shall constitute the complete and exclusive agreement between the parties
regarding the subject matter hereof. No modification or amendment of this
Agreement or waiver of any rights hereunder shall be valid unless in writing
and duly signed by a party authorized by each party hereto.




     Dated effective as of the Grant Date.



	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	PETsMART, Inc.
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	Duly authorized on behalf
	

	 	 	 	of the Board of Directors







Attachments:





	 	 	PETsMART, Inc. 2003 Equity Incentive Plan

PETsMART, Inc. 2003 Equity Incentive Plan Prospectus




16