**Exhibit 10.1**

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**THE PEP BOYS —MANNY, MOE & JACK PENSION PLAN**

 

**AMENDMENT 2009-1**

 

Pursuant to the authorityreserved to it under Section 8.2 of The Pep Boys — Manny, Moe &Jack Pension Plan (the “Pension Plan”), the Administrative Committee for thePension Plan (the “Committee”) hereby amends the Pension Plan as follows:

 

1.                                       Article IXof the Plan is hereby amended to add a new Section 9.4B to read in itsentirety as follows:

 

9.4B                         Maximum Annual Retirement Allowance forLimitation Years beginning on or after July 1, 2007. Except as otherwise provided below, the provisions of this Section shallbe effective as of the first Limitation Year beginning on or after July 1,2007.  The limitations, adjustments andother requirements prescribed herein shall at all times comply with theprovisions of section 415 of the Code and the final regulations thereunder, theterms of which are specifically incorporated herein by reference.

 

(a)                                  Notwithstanding anything in the Plan tothe contrary, in no event shall the combined Annual Benefit payable withrespect to a Participant on a single life basis under this or any other definedbenefit plan maintained by the Employer or any Affiliate under which theParticipant is covered as a participant exceed the lesser of: (1) $160,000(or such other figure determined in accordance with the cost of livingadjustment procedure under section 415(d) of the Code and Treas. Reg. Section 1.415(d)-1(a),but only for the year in which such adjustment is effective); and (2) 100%of the Participant’s average annual Compensation during the three consecutiveyears (as adjusted pursuant to section 415(d) of the code and Treas. Reg.sections 1.415(d)-1(a) and 1.415(b)-1(a)) in which the Participantreceived the greatest amount of Compensation. The Plan may use any 12-month period to determine a year of service,provided that such period is determined consistently and applied uniformly toall Participants. Such 12 month period shall be the Plan Year.   For a Participant who is employed by theEmployer for fewer than three consecutive years, the period of the Participant’shigh three years of service is the actual number of consecutive years ofservice (including fractions of a year, but not less than one year).  With respect to a Participant who incurs a breakin service and is rehired by the Employer, the Participant’s high three yearsof service shall be calculated by excluding all years for which the Participantperforms no services for and receives no Compensation from the Employermaintaining the Plan and by bridging the years of service before and after thebreak in service and treating such years as if they were consecutive.

 

(b)                                 Notwithstanding subsection (a) ofthis Section, benefits up to $10,000 for a Limitation Year may be paid withoutregard to the 100% of Compensation limitation if the total retirement benefitspayable to a Participant under all defined benefit plans maintained by theEmployer and any Affiliate for the present and any prior Limitation Year do notexceed $10,000 and the Employer (or a predecessor employer) and any Affiliatehas not at any time maintained a defined contribution plan in which theParticipant was covered.  For purposes ofdetermining the $10,000 amount, the benefit payable with respect to theParticipant under a plan for a Limitation Year reflects all amounts payableunder the plan for the Limitation Year (except

 

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asotherwise provided in Treas. Reg. Section 1.415(d)-1) and are not adjustedfor form of benefit or commencement date.

 

(c)                                  If a Participant has multiple AnnuityStarting Dates, the limitations of section 415 of the Code and the regulationsthereunder must be met separately as of each of Annuity Starting Date takinginto account the benefits that have been or will be provided as of each AnnuityStarting Date.

 

(d)                                 If a Participant’s Annual Benefit (or aretirement benefit to which the Participant is entitled under any other definedbenefit plan maintained by the Employer or any Affiliate) is payable in a formother than a single life annuity or qualified joint and survivor annuity, theAnnual Benefit shall be converted to a single life annuity using the interestrate and mortality assumptions specified in the Plan for Actuarial Equivalencefor the particular form of benefit payable. The single life annuity, which has been so determined shall be comparedto the single life annuity that has the same actuarial present value as theform of benefit payable to the Participant, computed using a 5 percent interestrate assumption (or for any form of benefit subject to section 417(e)(3) ofthe Code, the Applicable Interest Rate and the Applicable Mortality Table.  The greater of these two amounts shall be theapplicable limit for the Annual Benefit payable in a form other than a singlelife annuity or qualified joint and survivor annuity.

 

Notwithstandingthe foregoing, the following shall not be taken into account: any ancillarybenefit that is not related to retirement income benefits; and the survivorannuity provided under the portion of any annuity that constitutes a qualifiedjoint and survivor annuity (as defined in section 417(b) of the Code).

 

(i)                                     For purposes of the adjustment set forthabove, for the Plan Years commencing on January 1, 2004 and January 1,2005, for any form of benefit subject to section 417(e)(3) of the Code,for purposes of the adjustment set forth in this subsection (d), the ApplicableInterest Rate above shall not be less than 5.5%.

 

(ii)                                  For Plan Years beginning on or after January 1,2006, for any form of benefit subject to section 417(e)(3) of the Code,for purposes of the adjustment set forth in this subsection (d), the interestrate shall not be less than the greatest of 5.5%, the rate specified in thePlan or the rate that produces a benefit of not more than 105% of the benefitthat would be produced using the Applicable Interest Rate.

 

(e)                                  If the benefit of a Participant beginsprior to age 62, the defined benefit dollar limitation applicable to theParticipant at such earlier age is an Annual Benefit payable in the form of asingle life annuity beginning at the earlier age that is the ActuarialEquivalent of the defined benefit dollar limitation applicable to theParticipant at age 62 (adjusted under (a) above if applicable).  The defined benefit dollar limitationapplicable at an age prior to age 62 is determined as the lesser of (1) theactuarial equivalent at such age of the defined benefit dollar limitationcomputed using a 5% interest rate and the applicable mortality table as definedin section 415(b)(2)(E)(v) of the Code; and (2) the amount determinedby multiplying the defined benefit dollar limitation by the ratio of the annualamount of the single life annuity beginning at such earlier age (computed usingthe interest rate and mortality table or other tabular factor specified forearly retirement benefits under the Plan) to the annual amount of the singlelife

 

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annuityunder the Plan commencing at age 62 (with both such amounts determined withoutapplication of the rules of section 415 of the Code).

 

Anydecrease in the defined benefit dollar limitation determined in accordance withthis subsection (e) shall not reflect a mortality decrement if benefitsare not forfeited upon the death of the Participant.  If any benefits are forfeited upon death, thefull mortality decrement is taken into account. No forfeiture shall be deemed to occur, if the Plan provides a qualifiedpre-retirement survivor annuity and does not charge the Participant for suchcoverage.

 

(f)                                    If the benefit of a Participant beginsafter the Participant attains age 65, the defined benefit dollar limitationapplicable to the Participant at the later age is an Annual Benefit payable inthe form of a single life annuity beginning at the later age determined as thelesser of (1) the actuarial equivalent at such age of the defined benefitdollar limitation computed using a 5% interest rate and the applicablemortality table as defined in section 415(b)(2)(E)(v) of the Code; and (2) theamount determined by multiplying the defined benefit dollar limitation by theratio of (A) the annual amount of the single life annuity beginning atsuch later age (computed using the interest rate and mortality assumptions fordelayed retirement benefits under the Plan, if applicable) to (B) theannual amount of the single life annuity under the Plan commencing at age 65(computed without using the interest rate and mortality assumptions for delayedretirement benefits under the Plan, if applicable) (with both such amounts in (A) and(B) determined without application of the rules of section 415 of theCode).  The amount of the Annual Benefitbeginning at such later age is the annual amount of the benefit (determinedwithout regard to section 415 of the Code) computed by disregarding theParticipant’s accruals after age 65, but including actuarial adjustments evenif such adjustments are applied to offset benefit accrual.

 

Forthese purposes, mortality between age 65 and the age at which benefits commenceshall be ignored.  No forfeiture shall bedeemed to occur if the Plan provides a qualified pre-retirement survivorannuity and does not charge the Participant for such coverage.

 

(g)                                 If the Participant has fewer than 10years of participation in the Plan, the defined benefit dollar limitation shallbe multiplied by a fraction, the numerator of which is the number of years (orpart thereof) of participation in the Plan and the denominator of which is10.  In the case of a Participant who hasfewer than 10 years of service with the Employer, the defined benefitcompensation limitation and the $10,000 minimum benefit shall be multiplied bya fraction, the numerator of which is the number of years (or part thereof) ofservice with the Employer and the denominator of which is 10.  Years of service and years of participationshall be determined in accordance with Treas. Reg. sections 1.415(b)-1(g)(1)(ii) and(g)(2)(ii).

 

(h)                                 The Annual Benefit of a Participant whowas a Participant in the Plan before the first Limitation Year that begins onor after July 1, 2007, shall not be reduced under any other provisions ofthis Section 4.09 to the extent that it does not exceed the Participant’sAnnual Benefit accrued as of the end of the Limitation Year that endsimmediately prior to the first Limitation Year that begins on or after July 1,2007 and determined in accordance with the requirements of section 415 of theCode in effect on that date and provisions of the Plan that were both adoptedand in effect before April 5, 2007.

 

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Thelimitations stated herein for a Participant who has separated from service witha non-forfeitable right to an accrued benefit shall be adjusted annually asprovided in section 415(d) of the Code pursuant to the regulationsprescribed by the Secretary of the Treasury.

 

(i)                                     The following definitions apply forpurposes of this Section 4.09:

 

(i)                                     “Affiliate” means with respect to anyEmployer (A) any corporation that is a member of the same controlled groupof corporations (within the meaning of section 414(b) of the Code) as suchcompany; (B) any member of an affiliated service group, as determinedunder section 414(m) of the Code, of which such company is a member; (C) anytrade or business that is under common control with such company, as determinedunder section 414(c) of the Code and (D) any other entity which isrequired to be aggregated with the Employer under section 414(o) of theCode, but with “more than 50%” substituted for the phrase “at least 80%” insection 1563(a)(1) of the Code, when applying sections 414(b) and 414(c) ofthe Code and in the regulations under section 414(c) (except for purposesof determining whether two or more organizations are a brother-sister groupunder common control under the rules of Treas. Reg. section1.414(c)-2(c)).

 

(ii)                                  “Annual Benefit” means a retirementbenefit which is payable annually in the form of a straight life annuity withno ancillary benefits and determined without regard to any rollovercontributions or contributions made by a Participant.  If the benefit under the Plan is payable inany other form (other than a qualified joint and survivor annuity), the annualbenefit shall be adjusted to the equivalent of a straight life annuity as setforth herein.  The annual limitationapplicable to rollover contributions, contributions made by a Participant andany transferred contributions shall be determined in accordance with Treas.Reg. section 1.415(b)-1(b)(2).

 

(ii)                                  “Applicable Interest Rate” means theinterest rate described in subsection (b) of the second paragraph of Section 2.1(d) underthe definition of “Actuarial Equivalent(ce) or Actuarially Equivalent.”

 

(iii)                               “Applicable Mortality Table” means the mortalitytable described in Section 2.1(e) under the definition of “ActuarialEquivalent(ce) or Actuarially Equivalent.”

 

(iv)                              “Compensation” means compensation asdefined in Treas. Reg. section 1.415(c)-2(b) and including those itemsspecified in Treas. Reg. sections 1.415(c)-2(e)(2), 1.415(c)-2(e)(3)(iii),1.415(c)-2(e)(4) and 1.415(c)-2(g)(5) and (g)(6).  Compensation shall not reflect compensationfor a year that is in excess of the limitation under section 401(a)(17) of theCode that applies to that year.

 

(v)                                 “Limitation Year” means the Plan Year.

 

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INWITNESS WHEREOF, and as evidence of the adoption of this amendmentset forth herein, the Committee has caused this instrument to be executed this 11thday of August, 2009.

 

 
|   | /s/  ADMINISTRATIVE COMMITTEE FOR THE  |
|--------|----------------------------------------|
|   | PEP  BOYS - MANNY, MOE & JACK |
|   | PENSION  PLAN                          |

 

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