Document:

exv10w3

Exhibit 10.3

PETSMART, INC.

Restricted Stock Grant Notice

(2011 Equity Incentive Plan)

     PetSmart, Inc. (the “Company”), pursuant to its 2011 Equity Incentive
Plan as defined below (the “Plan”) hereby grants to Participant the right to acquire the number of
shares of the Company’s Common Stock set forth below (“Award”). This Award is “restricted stock”
granted pursuant to Section 7 of the Plan and is subject to all of the terms and conditions as set
forth herein and the Plan, which is attached hereto and incorporated herein in its entirety.
Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan.

	 	 	 	 	 

	Participant:
	 	 	 	 
	Date of Grant:

	 	 

	 	 
	Number of Shares Subject to Award:

	 	 

	 	 
	Closing Date:

	 	 

	 	 
	Email Address:

	 	 

	 	 
	 

	 	 

	 	 

Vesting Schedule: The shares subject to this Award will vest in accordance with the
following schedule:

	 	 	 
	 	 	Percentage of Shares Vesting
	Vesting Date:	 	on the Vesting Date:
	VEST_DATE_PERIOD
	 	100%

This Grant Notice and the Plan set forth the entire understanding between Participant and the
Company regarding the acquisition of stock in the Company pursuant to this Award and supersede all
prior oral and written agreements on that subject with the exception of the following agreements:

	 	 	 

	Other Arrangements or Agreements:
	 	 
	 

	 	 
	 
	 	 
	 

	 	 

By accepting any award under this Grant Notice, Participant acknowledges receipt of, and
understands and agrees to the terms of, this Grant Notice and the Plan. Participant further
acknowledges receipt of the PetSmart, Inc. 2011 Equity Incentive Plan Prospectus.

 

 

PETSMART, INC.

Restricted Stock Grant Notice

(2011 Equity Incentive Plan)

     The details of your Award under the PetSmart, Inc. 2011 Equity Incentive Plan
are set forth below.

     1. Right to Purchase. This Award represents the right to purchase from the Company,
and the Company’s agreement to sell to you, the aggregate number of shares of Common Stock
specified in your Grant Notice for the consideration set forth in Section 3 and subject to all of
the terms and conditions of the Award and the Plan. You may not purchase less than the aggregate
number of shares specified in the Grant Notice.

     2. Closing. The purchase and sale of the shares shall be consummated as follows:

          (a) You may purchase the shares by delivering your Grant Notice, executed by you in the manner
required by the Company, to the Stock Plan Administration Manager of the Company, or to such other
person as the Company may designate, during regular business hours, on the Closing Date specified
in the Grant Notice (or at such other time and place as you and the Company may mutually agree upon
in writing) along with any consideration, other than your past or future services, to be delivered
by you on the Closing Date pursuant to Section 3 and such additional documents as the Company may
then require.

          (b) The Company will direct the transfer agent for the Company to deliver to the Escrow Agent
pursuant to the terms of Section 9, below, the certificate or certificates evidencing the shares of
Common Stock being purchased by you. You acknowledge and agree that any such shares may be held in
book entry form directly registered with the transfer agent or in such other form as the Company
may determine.

     3. Payment. Unless otherwise specified in your Grant Notice, the purchase price for
the Common Stock to be delivered by you on the Closing Date shall be deemed paid, in whole or in
part, in consideration of past and future services in the amounts and to the extent required by
law.

     4. Vesting. Subject to the limitations and exceptions contained herein, the shares
you purchase will vest as provided in the Vesting Schedule set forth in this Grant Notice, provided
that vesting will cease upon the termination of your Continuous Status as an Employee, Director, or
Consultant. (The vesting pursuant to this Section 4(a) is referred to as “Regular Vesting.”) Your
Continuous Status as an Employee, Director, or Consultant shall not be considered terminated due to
a change in the capacity in which you perform services for the Company, provided you remain an
Employee, Director or Consultant of the Company.

          (a) Stock Trading Policy. In the event that you are subject to the Company’s policy on Stock
Trading by Officers, Directors and Certain Other Employees and any shares covered by your Award
vest on a day (the “Original Vest Date”) that does not occur during a “window period” applicable to
you as determined by the Company in accordance with such policy, then such shares shall not vest on
such Original Vest Date and shall instead vest on the first to occur

 

 

of the following: (a) the
first day of the next “window period” applicable to you pursuant to such policy, (b) your
termination of employment provided such termination of employment is after the Original Vest Date
and constitutes a Covered Termination as defined in the Plan, or (c) the day that is sixty (60)
days after the Original Vest Date.

          (b) Death or Disability. If your Continuous Status as an Employee, Director, or Consultant
ends due to death or Disability, vesting of the shares you purchase under this Award shall be
prorated over the vesting period by reference to the number of months of service you completed
after the Closing Date as a fraction against the number of months in the vesting period (with any
fractional or partial month eliminated), not to exceed one hundred percent (100%).

          (c) Retirement Termination. If you are an Eligible Retiree as defined below and you incur a
Retirement Termination prior to the expiration of the vesting period that commences on the Closing
Date, the vesting of the shares you purchase under this Award will automatically accelerate
pursuant to the Retirement Vesting Schedule set forth below. (The vesting pursuant to this Section
4(c) is referred to as “Retirement Vesting.”)

               (i) A “Retirement Termination” shall mean a termination of your Continuous Status as an
Employee, Director or Consultant pursuant to a voluntary termination but only if (A) such voluntary
termination has been designated by the Company, in its sole discretion, as a retirement; and (B)
you enter into a noncompetition agreement, if requested by, and in a form acceptable to, the
Company. Notwithstanding the foregoing, the Company shall not designate a voluntary termination as
a retirement if the Company determines that such termination is detrimental to the Company.

               (ii) The Retirement Vesting Schedule shall be determined as set forth in this Section
4(c)(ii). Unless and until there is a Retirement Termination, the vesting percentage for the
Retirement Vesting Schedule shall be zero. If a Retirement Termination occurs, the vesting shall
be prorated over the applicable vesting period by reference to the number of months of service you
completed after the Closing Date as a fraction against the number of months in the vesting period
(with any fractional or partial month eliminated), not to exceed one hundred percent (100%).

               (iii) You are an “Eligible Retiree” if, at the time of the termination of your Continuous
Status as an Employee, Director or Consultant, (A) you are an Employee, (B) you are at least
fifty-five (55) years of age, and (C) you have been continuously employed by the Company or an
Affiliate during the five (5) year period ending on the date of your termination.

          (d) Shares purchased by you that have vested in accordance with the Vesting Schedule set forth
in this Grant Notice are “Vested Shares.” Shares purchased by you pursuant to this Notice that are
not Vested Shares are “Unvested Shares.”

     5. Number of Shares and Cash Purchase Price per Share. The number of shares of
Common Stock subject to your Award and your Cash Purchase Price per Share referenced in this Grant
Notice may be adjusted from time to time for capitalization adjustments as set forth in the Plan.

     6. Securities Law Compliance. Notwithstanding anything to the contrary contained
herein, you may not purchase any shares of Common Stock under your Award unless the shares of
Common Stock issuable upon such purchase are then registered under the Securities Act

 

 

or, if such
shares of Common Stock are not then so registered, the Company has determined that such purchase
and issuance would be exempt from the registration requirements of the Securities Act. The
purchase of shares under your Award also must comply with other applicable laws and regulations
governing your Award, and you may not purchase such shares if the Company determines that such
purchase would not be in material compliance with such laws and regulations.

     7. Right of Reacquisition. The Company shall simultaneously with the termination of
your Continuous Status as an Employee, Director, or Consultant automatically reacquire (the
“Reacquisition Right”) for no consideration all of the Unvested Shares, unless the Company agrees
to waive its Reacquisition Right as to some or all of the Unvested Shares. Any such waiver shall
be exercised by the Company by written notice to you or your representative (with a copy to the
Escrow Agent, as defined below) within ninety (90) days after the termination of your Continuous
Status as an Employee, Director, or Consultant, and the Escrow Agent may then release to you the
number of Unvested Shares not being reacquired by the Company. If the Company does not waive its
reacquisition right as to all of the Unvested Shares, then upon such termination of your Continuous
Status as an Employee, Director, or Consultant, the Escrow Agent shall transfer to the Company the
number of Unvested Shares the Company is reacquiring. The Reacquisition Right shall expire when
all of the shares have become Vested Shares in accordance with Section 4.

     8. Certain Corporate Transactions. In the event of a corporate transaction event set
forth in Section 13(b) of the Plan, the Reacquisition Right may be assigned by the Company to the
successor of the Company (or such successor’s parent company), if any, in connection with such
transaction. To the extent the Reacquisition Right remains in effect following such transaction,
it shall apply to the new capital stock or other property received in exchange for the Common Stock
in consummation of the transaction, but only to the extent the Common Stock was at the time covered
by such right.

     9. Escrow of Unvested Common Stock. As security for your faithful performance of the
terms set forth in this Grant Notice and to insure the availability for delivery of your Common
Stock upon execution of the Reacquisition Right provided in Section 7, above, you agree to the
following “Joint Escrow” and “Joint Escrow Instructions,” and you and the
Company hereby authorize and direct the Corporate Secretary of the Company or the Corporate
Secretary’s designee (“Escrow Agent”) to hold the documents delivered to Escrow Agent pursuant to
the terms of this Notice and of your Grant Notice, in accordance with the following Joint Escrow
Instructions:

          (a) In the event of the termination of your Continuous Status as an Employee, Director, or
Consultant, the Company shall pursuant to the Reacquisition Right in Section 7, above,
automatically reacquire for no consideration all Unvested Shares, within the meaning of Section 4,
above, as of the date of such termination, unless the Company elects to waive such right as to some
or all of the Unvested Shares. If the Company (or its assignee) elects to waive the Reacquisition
Right, the Company or its assignee will give you and Escrow Agent a written notice specifying the
number of shares of stock not to be reacquired. You and the Company hereby irrevocably authorize
and direct Escrow Agent to close the transaction contemplated by such notice as soon as practicable
following the date of termination of service in accordance with the terms of this Notice and the
notice of waiver, if any.

          (b) Vested Shares shall be delivered to you upon your request given in the manner provided in
Section 19 for giving notices.

 

 

          (c) At any closing involving the transfer or delivery of some or all of the property subject
to this Award and Grant Notice, Escrow Agent is directed (a) to date any stock assignments
necessary for the transfer in question, (b) to fill in the number of shares being transferred, and
(c) to deliver same, together with the certificate, if any, evidencing the shares of Common Stock
to be transferred, to you or the Company, as applicable.

          (d) You irrevocably authorize the Company to deposit with Escrow Agent the certificates, if
any, evidencing shares of Common Stock to be held by Escrow Agent hereunder and any additions and
substitutions to said shares as specified in this Agreement. You do hereby irrevocably constitute
and appoint Escrow Agent as your attorney-in-fact and agent for the term of this escrow to execute
with respect to such securities and other property all documents of assignment and/or transfer and
all stock certificates necessary or appropriate to make all securities negotiable and complete any
transaction herein contemplated.

          (e) This escrow shall terminate upon the expiration or application in full of the
Reacquisition Right, whichever occurs first, and the completion of the tasks contemplated by these
Joint Escrow Instructions.

          (f) If at the time of termination of this escrow Escrow Agent should have in its possession
any documents, securities, or other property belonging to you, Escrow Agent shall deliver all of
same to you and shall be discharged of all further obligations hereunder.

          (g) Except as otherwise provided in these Joint Escrow Instructions, Escrow Agent’s duties
hereunder may be altered, amended, modified, or revoked only by a writing signed by all of the
parties hereto.

          (h) Escrow Agent shall be obligated only for the performance of such duties as are
specifically set forth herein and may rely and shall be protected in relying or refraining from
acting on any instrument reasonably believed by Escrow Agent to be genuine and to have been signed
or presented by the proper party or parties or their assignees. Escrow Agent shall not be
personally liable for any act Escrow Agent may do or omit to do hereunder as Escrow Agent or as
attorney-in-fact for you while acting in good faith and any act done or omitted by Escrow Agent
pursuant to the advice of Escrow Agent’s own attorneys shall be conclusive evidence of such good
faith.

          (i) Escrow Agent is hereby expressly authorized to disregard any and all warnings given by any
of the parties hereto or by any other person or corporation, excepting only orders or process of
courts of law, and is hereby expressly authorized to comply with and obey orders, judgments, or
decrees of any court. In case Escrow Agent obeys or complies with any such order, judgment, or
decree of any court, Escrow Agent shall not be liable to any of the parties hereto or to any other
person, firm, or corporation by reason of such compliance, notwithstanding any such order,
judgment, or decree being subsequently reversed, modified, annulled, set aside, vacated, or found
to have been entered without jurisdiction.

          (j) Escrow Agent shall not be liable in any respect on account of the identity, authority, or
rights of the parties executing or delivering or purporting to execute or deliver this Notice or
any documents or papers deposited or called for hereunder.

 

 

          (k) Escrow Agent shall not be liable for the outlawing of any rights under any statute of
limitations with respect to these Joint Escrow Instructions or any documents deposited with Escrow
Agent.

          (l) Escrow Agent’s responsibilities as Escrow Agent hereunder shall terminate if Escrow Agent
shall cease to be the Secretary of the Company or if Escrow Agent shall resign by written notice to
each party. In the event of any such termination, the Company may appoint any officer or assistant
officer of the Company or other person who in the future assumes the position of Secretary for the
Company as successor Escrow Agent and you hereby confirm the appointment of such successor or
successors as your attorney-in-fact and agent to the full extent of such successor Escrow Agent’s
appointment.

          (m) If Escrow Agent reasonably requires other or further instruments in connection with these
Joint Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join
in furnishing such instruments.

          (n) It is understood and agreed that should any dispute arise with respect to the delivery
and/or ownership or right of possession of the securities, Escrow Agent is authorized and directed
to retain in its possession without liability to anyone all or any part of said securities until
such dispute shall have been settled either by mutual written agreement of the parties concerned or
by a final order, decree, or judgment of a court of competent jurisdiction after the time for
appeal has expired and no appeal has been perfected, but Escrow Agent shall be under no duty
whatsoever to institute or defend any such proceedings.

          (o) By signing the Grant Notice, Escrow Agent becomes a party hereto only for the purpose of
said Joint Escrow Instructions in this Section 9; Escrow Agent does not become a party to any other
rights and obligations of the Grant Notice apart from those in this Section 9.

          (p) Escrow Agent shall be entitled to employ such legal counsel and other experts as Escrow
Agent may deem necessary properly to advise Escrow Agent in connection with Escrow Agent’s
obligations hereunder. Escrow Agent may rely upon the advice of such counsel, and may pay such
counsel reasonable compensation therefor. The Company shall be responsible for all fees generated
by such legal counsel in connection with Escrow Agent’s obligations hereunder.

          (q) These Joint Escrow Instructions set forth in this Section 9 shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and permitted assigns.
It is understood and agreed that references to “Escrow Agent” or “Escrow Agent’s” herein refer to
the original Escrow Agent and to any and all successor Escrow Agents. It is understood and agreed
that the Company may at any time or from time to time assign its rights under the Grant Notice and
these Joint Escrow Instructions in whole or in part.

     10. Execution of Documents. You hereby acknowledge and agree that the manner
selected by the Company by which you indicate your consent to your Grant Notice is also deemed to
be your execution of your Grant Notice. You further agree that such manner of indicating consent
may be relied upon as your signature for establishing your execution of any documents to be
executed in the future in connection with your Award.

 

 

     11. Irrevocable Power of Attorney.  You constitute and appoint the Company’s
Secretary as attorney-in-fact and agent to transfer said Common Stock on the books of the Company
with full power of substitution in the premises, and to execute with respect to such securities and
other property all documents of assignment and/or transfer and all stock certificates necessary or
appropriate to make all securities negotiable and complete any transaction herein contemplated.
This is a special power of attorney coupled with an interest (specifically, the Company’s
underlying security interest in retaining the shares of Common Stock in the event you do not
perform the associated services for the Company), and is irrevocable and shall survive your death
or legal incapacity. This power of attorney is limited to the matters specified in this Grant
Notice.

     12. Rights as Stockholder. Subject to the provisions of this Grant Notice, you shall
have the right to exercise all rights and privileges of a stockholder of the Company with respect
to the shares deposited in the Joint Escrow. You shall be deemed to be the holder of the
shares for purposes of receiving any dividends that may be paid with respect to such shares and for
purposes of exercising any voting rights relating to such shares, even if some or all of the shares
are Unvested Shares.

     13. Limitations on Transfer of the Common Stock. In addition to any other limitation
on transfer created by applicable securities laws, you shall not sell, assign, hypothecate, donate,
encumber, or otherwise dispose of any interest in the Common Stock while
such shares of Common Stock are Unvested Shares or continue to be held in the Joint Escrow;
provided, however, that an interest in such shares may be transferred pursuant to a qualified
domestic relations order as defined in the Code or Title I of the Employee Retirement Income
Security Act. After any Common Stock has been released from the Joint Escrow, you shall not sell,
assign, hypothecate, donate, encumber, or otherwise dispose of any interest in the Common Stock
except in compliance with the provisions herein and applicable securities laws.

     14. Restrictive Legends. The certificates representing the Common Stock shall have
endorsed thereon appropriate legends as determined by the Company.

     15. Non-transferability of the Award. Your Award (except for Vested Shares issued
pursuant thereto) is not transferable except by will or by the laws of descent and distribution and
shall be exercisable during your lifetime only by you. In the event of the termination of your
Continuous Status as an Employee, Director, or Consultant prior to the Closing Date, the Closing
shall not occur.

     16. Award not a Service Contract. Your Award is not an employment or service
contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation
on your part to continue in the employ of the Company or an Affiliate, or of the Company or an
Affiliate to continue your employment. In addition, nothing in your Award shall obligate the
Company or an Affiliate, their respective stockholders, Boards of Directors, Officers or Employees
to continue any relationship that you might have as a Director or Consultant for the Company or an
Affiliate.

     17. Withholding Obligations.

          (a) At the time your Award is granted, or at any time thereafter as requested by the Company,
you hereby authorize withholding from payroll and any other amounts payable to

 

 

you, and otherwise
agree to make adequate provision in cash for, as determined by the Company, any sums required to
satisfy the federal, state, local and foreign tax withholding obligations of the Company or an
Affiliate, if any, which arise in connection with your Award. In the Company’s sole discretion,
the Company may elect, and you hereby authorize the Company, to withhold Vested Shares in such
amounts as the Company determines are necessary to satisfy your obligation pursuant to the
preceding sentence.

          (b) Unless the tax withholding obligations of the Company or any Affiliate are satisfied, the
Company shall have no obligation to issue a certificate for such shares or release such shares from
any escrow provided for herein.

     18. Tax Consequences. You have reviewed with your own tax advisors the federal,
state, local and foreign tax consequences of this investment and the transactions contemplated by
this Grant Notice. You are relying solely on such advisors and not on any statements or
representations of the Company or any of its agents. You understand that you (and not the Company)
shall be responsible for your own tax liability that may arise as a result of this investment or
the transactions contemplated by this Notice. You understand that Section 83 of the Code taxes as
ordinary income to you the fair market value of the shares of Common Stock as
of the date any restrictions on the shares lapse (that is, as of the date on which part or all
of the shares vest). In this context, “restriction” includes the right of the Company to reacquire
the shares pursuant to its Reacquisition Right. You understand that you may elect to be taxed on
the fair market value of the shares at the time the shares are purchased rather than when and as
the Company’s Reacquisition Right expires by filing an election under Section 83(b) of the Code
with the Internal Revenue Service within thirty (30) days after the date you purchase the shares
pursuant to your Award. YOU ACKNOWLEDGE THAT IT IS YOUR SOLE RESPONSIBILITY, AND NOT THE
COMPANY’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF YOU REQUEST THE COMPANY OR
ITS REPRESENTATIVES TO MAKE THE FILING ON YOUR BEHALF. You further acknowledge that you are aware
that should you file an election under Section 83(b) of the Code and then subsequently forfeit the
shares, you will not be able to report as a loss the value of any shares forfeited and will not get
a refund of any of the tax paid.

     19. Notices. Any notice or request required or permitted hereunder shall be given in
writing to each of the other parties hereto and shall be deemed effectively given on the earlier of
(a) the date of personal delivery, including delivery by express courier, or (b) the date that is
five days after deposit in the United States Post Office (whether or not actually received by the
addressee), by registered or certified mail with postage and fees prepaid, addressed at the
following addresses, or at such other address(es) as a party may designate by ten days’ advance
written notice to each of the other parties hereto:

	 	 	 	 	 

	 

	 	Company:
	 	PetSmart Inc.
	 

	 	 	 	19601 North 27th Avenue
	 

	 	 	 	Phoenix, AZ 85027
	 

	 	 	 	Attn: General Counsel
	 
	 	 	 	 
	 

	 	You:
	 	Your address as on file with the Company’s
	 

	 	 	 	People Department at the time notice is given
	 
	 	 	 	 
	 

	 	Escrow Agent:
	 	Corporate Secretary

 

 

	 	 	 	 	 

	 

	 	 	 	PetSmart, Inc.
	 

	 	 	 	19601 North 27th Avenue
	 

	 	 	 	Phoenix, AZ 85027

     20. Miscellaneous.

          (a) The rights and obligations of the Company under your Award shall be transferable to any
one or more persons or entities, and all covenants and agreements hereunder shall inure to the
benefit of, and be enforceable by, the Company’s successors and assigns. Your rights and
obligations under your Award may only be assigned with the prior written consent of the Company.

          (b) You agree upon request to execute any further documents or instruments necessary or
desirable in the sole determination of the Company to carry out the purposes or intent of your
Award.

          (c) You acknowledge and agree that you have reviewed your Award in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully
understand all provisions of your Award.

     21. Governing Plan Document. Your Award is subject to all the provisions of the
Plan, the provisions of which are hereby made a part of your Award, and 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 Award
and those of the Plan, the provisions of the Plan shall control.

 

 

Attachment II

The Planexv10w4

Exhibit 10.4

PetSmart, Inc.

Performance Share Unit Grant Notice

(2011 Equity Incentive Plan)

     PetSmart, Inc. (the “Company”), pursuant to its 2011 Equity Incentive Plan
(the “Plan”) hereby grants to Participant the Maximum Number of Performance Share Units as set
forth below (the “PSU Grant”). This PSU Grant is a “restricted stock unit” granted pursuant to
Section 7 of the Plan and is subject to all of the terms and conditions as set forth herein and the
Plan, which is attached hereto and incorporated herein in its entirety. Capitalized terms not
otherwise defined herein shall have the meanings set forth in the Plan. Except as otherwise
expressly provided herein, in the event of any conflict between the terms in the PSU Grant Notice
and the Plan, the terms of the Plan shall control.

	 	 	 	 	 	 	 

	 

	 	Participant:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Date of Grant:
	 	                                        , 20     	 	 
	 

	 	Target Number of Performance Share Units (PSUs)	 	 	 	 
	 

	 	Minimum Number of Performance Share Units Granted
	 	 

50% of                    PSUs
	 	 
	 

	 	Maximum Number of Performance Share Units Granted
	 	150% of                    PSUs	 	 
	 

	 	Consideration:
	 	Participant’s services	 	 
	 

	 	Email Address:	 	 	 	 
	 

	 	 	 	 

	 	 

     This Grant Notice and the Plan set forth the entire understanding between Participant
and the Company regarding the PSU Grant and supersede all prior oral and written agreements on that
subject. Notwithstanding the foregoing, if the Participant is eligible to participate in the
Executive Change in Control and Severance Benefit Plan (an “Executive Participant”), the PSU Grant
shall be subject to the terms of the Executive Change in Control and Severance Benefit Plan (the
“Executive Severance Plan”) to the extent expressly herein.

     The details of your PSU Grant are as follows:

     1. PSU Grant. This PSU Grant represents the right to be awarded on a future date a
number of Performance Share Units not exceeding the Maximum Number of Performance Share Units
indicated above. This PSU Grant was granted in consideration of your services to the Company.
Except as otherwise provided herein, you will not be required to make any payment to the Company
(other than past and future services to the Company) with respect to your receipt of the PSU Grant,
the award of Performance Share Units, the vesting of the Performance Share Units, or the delivery
of common stock in respect of the PSU Grant.

     2. Number of Awarded Performance Share Units. The actual number of Performance Share
Units to be awarded to you will be determined as follows:

          (a) The actual number of Performance Share Units to be awarded to you may not exceed the
Maximum Number of Performance Share Units Granted pursuant to this Grant Notice, as indicated
above. The number of Performance Share Units awarded to you will be
determined by the Company’s Compensation Committee or its designee (the “Committee”)

 

 

subject
to the performance conditions as determined by the Committee (the “Performance Conditions”) and set
forth in writing prior to the granting of any Awards pursuant to this Notice.

          (b) No later than thirty (30) days after the receipt by the Committee of the audited financial
statements for the Performance Period applicable to the PSU Grant, the Committee shall determine
whether the established Performance Criteria for the PSU Grant were achieved, and the number of
Performance Share Units subject to the PSU Grant to be awarded to you. Performance Share Units
shall not be awarded based upon the attainment of Performance Criteria unless and until the
Committee makes such determination. The Committee shall have discretion to reduce the number of
Performance Share Units that are awarded depending on (i) the extent to which the designated
Performance Criteria are either exceeded or not met, and (ii) the extent to which other objectives,
e.g. subsidiary, division, department, unit or other performance objectives are attained. The
Committee shall have full discretion to reduce the number of Performance Share Units that are
awarded based on your individual performance or other factors as it considers appropriate in the
circumstances. The Committee shall not have discretion to increase the number of Performance Share
Units that are awarded to you.

          (c) For purposes of satisfaction of the Performance Conditions, the term “Change of Control
Transaction” means a transaction that qualifies as one or more of the following: (i) a transaction
described in Section 15(b) of the Plan, where the surviving corporation will not assume or continue
the PSU Grant, or substitute a similar award for the PSU Grant, or (ii) a “Change of Control” as
such term is defined in Section 15(b) the Plan. Additionally, if Participant is an Executive
Participant, the Performance Conditions shall be satisfied upon a “Change of Control, as defined in
Executive Change in Control and Severance Benefit Plan (“Severance Plan”); provided that the
Executive Participant is employed by the Company on any date within the three (3) month period
preceding such Change of Control. If the Performance Conditions are satisfied due to a Change of
Control Transaction or Change of Control under the Severance Plan as provided in this paragraph,
then 100% of Target Number of Performance Share Units will be awarded.

          (d) For purposes of satisfaction of the Performance Conditions, no subsequent agreement shall
be effective to amend, alter or waive satisfaction of the Performance Conditions applicable to the
PSU Grant unless such agreement specifically provides for amendment of the Performance Conditions
applicable to the PSU Grant.

          (e) The number of Performance Share Units subject to your PSU Grant (and the corresponding
number of shares of common stock issuable at a future date) may be adjusted from time to time for
capitalization adjustments as set forth in the Plan. No fractional Performance Share Units shall
be created, and the Committee shall, in its discretion, determine an equivalent benefit for any
fractional Performance Share Units that might be created by such adjustments Any Performance Share
Units subject to your PSU Grant that are not awarded to you by the Committee will be automatically
forfeited, will revert to the Plan, and you will have no rights with respect to such forfeited
Performance Share Units.

     3. Vesting. Subject to the limitations contained herein, any Performance Share
Units that are awarded by the Committee based upon satisfaction of the Performance Conditions will
vest if the “Time-Based Vesting Conditions” are satisfied. The Time-Based Vesting

2

 

Conditions for
the Performance Share Units shall be satisfied if you retain your Continuous Status as an Employee,
Director or Consultant through the earlier of (i) the expiration of the three-year period that
commences on the Date of Grant, (ii) upon any vesting acceleration of the PSU Grant provided by the
Plan pursuant to its terms, (iii) upon any vesting acceleration of the PSU Grant provided by the
terms of this Grant Notice; (iv) if you are an Executive Participant, upon any vesting acceleration
of the PSU Grant provided by the Executive Severance Plan pursuant to its terms, or (v) upon any
vesting acceleration of the PSU Grant provided for pursuant to any Company plan or any agreement
between you and the Company, whether currently in effect or adopted or entered into hereafter. For
clarity, at no time shall the vesting of the PSU Grant be greater than one hundred percent (100%).
Any awarded Performance Share Units that have vested in accordance with the vesting criteria set
forth in this Section 3 are “Vested Units.” Your Continuous Status as an Employee, Director, or
Consultant shall not be considered terminated due to a change in the capacity in which you perform
services for the Company, provided you remain an Employee, Director, or Consultant of the Company.

          (a) Death or Disability. If your Continuous Status as an Employee, Director or Consultant
ends due to death or Disability, vesting of your Performance Share Units shall be prorated over the
vesting period by reference to the number of months of service you completed after the commencement
of the vesting period as a fraction against the number of months in the vesting period (with any
fractional or partial month eliminated), not to exceed one hundred percent (100%).

          (b) Retirement Termination. If you are an “Eligible Retiree” and incur a “Retirement
Termination” prior to the expiration of the three-year period that commences on the Date of Grant,
the PSU Grant will automatically accelerate vesting with respect to the percentage of the PSU Grant
as determined pursuant to the “Retirement Vesting Schedule” set forth below:

	 	•	 	You will be an “Eligible Retiree” if, at the time of termination of your Continuous
Status as an Employee, Director or Consultant, you (i) are an Employee; (ii) are at
least fifty-five (55) years of age; and (iii) have been continuously employed by the
Company or an Affiliate during the five (5) year period ending on the date of
termination.
	 
	 	•	 	“Retirement Termination” means a termination of your Continuous Status as an
Employee, Director or Consultant pursuant to voluntary termination but only if (i) such
voluntary termination has been designated by the Company, in its sole discretion, as a
retirement and (ii) you enter into a noncompetition agreement if requested by, and in a
form acceptable to, the Company. Notwithstanding the foregoing, the Company will not
designate your voluntary termination as a Retirement Termination if the Company
determines that such termination is detrimental to the Company.
	 
	 	•	 	“Retirement Vesting Schedule” shall be determined as follows. Unless and until
there is a Retirement Termination, the vesting percentage for the Retirement Vesting
Schedule shall be zero. If a Retirement Termination occurs, vesting shall be prorated
over the applicable vesting period by reference to the number of months of service you
completed after the commencement of the vesting period as a fraction against the

3

 

	 	 	 	number
of months in the vesting period (with any fractional or partial month eliminated), not
to exceed one hundred percent (100%). If Retirement Termination occurs on or after the
end of the Performance Period, the Retirement Vesting Schedule will be applied against
the PSU Grant as modified for performance pursuant to Section 2(b) of this Notice. If
Retirement Termination occurs before the end of the Performance Period, then the
Retirement Vesting Schedule will be applied against the PSU Grant assuming that target
performance, as determined by the Committee, is achieved.

          (c) Forfeiture. Any awarded Performance Share Units that do not vest in accordance with this
Section 3 will be automatically forfeited, will revert to the Plan, and you will have no rights
with respect to such forfeited Performance Share Units.

     4. Securities Law Compliance. Notwithstanding anything to the contrary contained
herein, you may not be issued any shares of common stock in respect of your PSU Grant unless either
(i) the shares of common stock are then registered under the Securities Act; or (ii) if the shares
of common stock are not then so registered, the Company has determined that such purchase and
issuance would be exempt from the registration requirements of the Securities Act. Your PSU Grant
also must comply with other applicable laws and regulations governing your PSU Grant, and you may
not receive such shares if the Company determines that such receipt would not be in material
compliance with such laws and regulations.

     5. Date of Issuance. 

          (a) The Company will deliver to you a number of shares of the Company’s common stock equal to
the number of Vested Units subject to your PSU Grant within thirty (30) days following the
applicable vesting date(s). However, if a scheduled delivery date falls on a date that is not a
business day, such delivery date shall instead fall on the next following business day.

          (b) Notwithstanding the foregoing, in the event that (i) you are subject to the Company’s
policy permitting officers and directors to sell shares only during certain “window” periods, in
effect from time to time or you are otherwise prohibited from selling shares of the Company’s
common stock in the public market and any shares in respect of your PSU Grant are scheduled to be
delivered on a day (the “Original Distribution Date”) that does not occur during an open “window
period” applicable to you, as determined by the Company in accordance with such policy, or does not
occur on a date when you are otherwise permitted to sell shares of the Company’s common stock on
the open market, and (ii) the Company elects not to satisfy its tax withholding obligations by
withholding shares from your distribution, a) you may satisfy the tax withholding by submitting a
cash payment to the Company and such shares will be delivered to
you on the Original Distribution Date or b) such shares shall not be delivered on such
Original Distribution Date and shall instead be delivered on the first business day of the next
occurring open “window period” applicable to you pursuant to such policy (regardless of whether you
are still providing continuous services at such time) or the next business day when you are not
prohibited from selling shares of the Company’s common stock in the open market, but in no event
later than the fifteenth (15th) day of the third calendar month of the calendar year following the
calendar year in which the Original Distribution Date occurs. The form of such

4

 

delivery (e.g., a
stock certificate or electronic entry evidencing such shares) shall be determined by the Company.

     6. Dividends. You shall receive no benefit or adjustment to your PSU Grant with
respect to any cash dividend, stock dividend or other distribution that does not result from a
capitalization adjustment as provided in the Plan; provided, however, that this sentence shall not
apply with respect to any shares of common stock that are delivered to you in connection with your
PSU Grant after such shares have been delivered to you.

     7. Non-transferability of the PSU Grant. Your PSU Grant is not transferable, except
by will or by the laws of descent and distribution. In addition to any other limitation on
transfer created by applicable securities laws, you agree not to assign, hypothecate, donate,
encumber or otherwise dispose of any interest in any of the shares of common stock that may be
issued to you in respect of the PSU Grant until the shares are issued to you in accordance with
Section 5 herein. After the shares have been issued to you, you are free to assign, hypothecate,
donate, encumber or otherwise dispose of any interest in such shares provided that any such actions
are in compliance with the provisions herein and applicable securities laws. Notwithstanding the
foregoing, 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
receive any distribution of common stock to which you were entitled at the time of your death
pursuant to this Grant Notice.

     8. Restrictive Legends. The shares issued in respect of your PSU Grant shall have
endorsed thereon appropriate legends as determined by the Company.

     9. PSU Grant not a Service Contract. Your PSU Grant is not an employment or service
contract, and nothing in your PSU Grant shall be deemed to create in any way whatsoever any
obligation on your part to continue in the employ of the Company or an Affiliate, or of the Company
or an Affiliate to continue your employment. In addition, nothing in your PSU Grant shall obligate
the Company or an Affiliate, their respective stockholders, Boards of Directors, Officers or
Employees to continue any relationship that you might have as a Director or Consultant for the
Company or an Affiliate.

     10. Withholding Obligations.

          (a) On or before the time you receive a distribution of the shares in respect of your PSU
Grant, or at any time thereafter as requested by the Company, you hereby authorize any required
withholding from the common stock issuable to you and/or otherwise agree to make adequate provision
in cash for any sums required to satisfy the federal, state, local and foreign tax
withholding obligations of the Company or any affiliate which arise in connection with your
PSU Grant (the “Withholding Taxes”). Additionally, the Company may, in its sole discretion,
satisfy all or any portion of the Withholding Taxes obligation relating to your PSU Grant by any of
the following means or by a combination of such means: (i) withholding from any compensation
otherwise payable to you by the Company; (ii) causing you to tender a cash payment; or (iii)
withholding shares of common stock from the shares of common stock issued or otherwise issuable to
you in connection with the PSU Grant with a Fair Market Value (measured as of the date shares of
common stock are issued to pursuant to Section 5) equal to the

5

 

amount of such Withholding Taxes;
provided, however, that the number of such shares of common stock so withheld shall not exceed the
amount necessary to satisfy the Company’s required tax withholding obligations using the minimum
required statutory withholding rates for federal, state, local and foreign tax purposes, including
payroll taxes, that are applicable to supplemental taxable income.

          (b) Unless the tax withholding obligations of the Company or any Affiliate are satisfied, the
Company shall have no obligation to deliver to you any common stock.

     11. Unsecured Obligation. Your PSU Grant is unfunded, and as a holder of a vested
PSU Grant, you shall be considered an unsecured creditor of the Company with respect to the
Company’s obligation, if any, to issue shares pursuant to this Grant Notice. You shall not have
voting or any other rights as a stockholder of the Company with respect to the shares to be issued
pursuant to this Grant Notice until such shares are issued to you pursuant to Section 5 herein.
Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company.
Nothing contained in this Grant Notice, and no action taken pursuant to its provisions, shall
create or be construed to create a trust of any kind or a fiduciary relationship between you and
the Company or any other person.

     12. Tax Consequences. You have reviewed with your own tax advisors the federal,
state, local and foreign tax consequences of this investment and the transactions contemplated by
this Grant Notice. You are relying solely on such advisors and not on any statements or
representations of the Company or any of its agents. You understand that you (and not the Company)
shall be responsible for your own tax liability that may arise as a result of your PSU Grant

     13. Notices. Any notice or request required or permitted hereunder shall be given in
writing to each of the other parties hereto and shall be deemed effectively given on the earlier of
(a) the date of personal delivery, including delivery by express courier, or (b) the date that is
five days after deposit in the United States Post Office (whether or not actually received by the
addressee), by registered or certified mail with postage and fees prepaid, addressed at the
following addresses, or at such other address(es) as a party may designate by ten days’ advance
written notice to each of the other parties hereto:

	 	 	 	 	 

	 

	 	Company:
	 	PetSmart Inc.
	 

	 	 	 	19601 North 27th Avenue
	 

	 	 	 	Phoenix, AZ 85027
	 

	 	 	 	Attn: General Counsel
	 
	 	 	 	 
	 

	 	You:
	 	Your address as on file with the Company’s
	 

	 	 	 	Human Resources Department at the time notice is given

Notwithstanding the foregoing, the Company may, in its sole discretion, decide to deliver any
documents related to participation in the Plan and this PSU Grant by electronic means or to request
your consent to participate in the Plan by electronic means. You hereby consent to receive such
documents by electronic delivery and, if requested, to agree to participate in the

6

 

Plan through an
on-line or electronic system established and maintained by the Company or another third party
designated by the Company.

     14. Miscellaneous.

          (a) The rights and obligations of the Company under your PSU Grant shall be transferable to
any one or more persons or entities, and all covenants and agreements hereunder shall inure to the
benefit of, and be enforceable by, the Company’s successors and assigns. Your rights and
obligations under your PSU Grant may only be assigned with the prior written consent of the
Company.

          (b) You agree upon request to execute any further documents or instruments necessary or
desirable in the sole determination of the Company to carry out the purposes or intent of your PSU
Grant.

          (c) You acknowledge and agree that you have reviewed your PSU Grant in its entirety, have had
an opportunity to obtain the advice of counsel and fully understand all provisions of your PSU
Grant.

          (d) This Grant Notice shall be subject to all applicable laws, rules, and regulations, and to
such approvals by any governmental agencies or national securities exchanges as may be required.

          (e) All obligations of the Company under the Plan and this Grant Notice shall be binding on
any successor to the Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.

     15. Governing Plan Documents. Your PSU Grant is subject to all the provisions of the
Plan, the provisions of which are hereby made a part of your PSU Grant, and is further subject to
all interpretations, amendments, rules and regulations which may from time to time be promulgated
and adopted pursuant to the Plan. Except as otherwise expressly provided herein in the event of
any conflict between the terms in the PSU Grant and the Plan, the terms of the Plan shall control.

     16. Severability. If all or any part of this Grant Notice or the Plan is declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity
shall not invalidate any portion of this Grant Notice or the Plan not declared to be unlawful
or invalid. Any Section of this Grant Notice (or part of such a Section) so declared to be unlawful
or invalid shall, if possible, be construed in a manner which will give effect to the terms of such
Section or part of a Section to the fullest extent possible while remaining lawful and valid.

     17. Effect on Other Employee Benefit Plans. The value of the PSU Grant subject to
this Grant Notice shall not be included as compensation, earnings, salaries, or other similar terms
used when calculating the Employee’s benefits under any employee benefit plan sponsored by the
Company or any affiliate, except as such plan otherwise expressly provides.

7

 

The Company expressly
reserves its rights to amend, modify, or terminate any of the Company’s or any affiliate’s employee
benefit plans.

     18. Choice of Law. The interpretation, performance and enforcement of this Award and
Grant Notice will be governed by the law of the state of Arizona without regard to such state’s
conflicts of laws rules.

     19. Amendment. This Grant Notice may not be modified, amended or terminated except
by an instrument in writing, signed by you and by a duly authorized representative of the Company.
Notwithstanding the foregoing, this Grant Notice may be amended solely by the Committee by a
writing which specifically states that it is amending this Award, so long as a copy of such
amendment is delivered to you, and provided that no such amendment adversely affecting your rights
hereunder may be made without your written consent. Without limiting the foregoing, the Committee
reserves the right to change, by written notice to you, the provisions of this Grant Notice in any
way it may deem necessary or advisable to carry out the purpose of the grant as a result of any
change in applicable laws or regulations or any future law, regulation, ruling, or judicial
decision, provided that any such change shall be applicable only to rights relating to that portion
of the PSU Grant which is then subject to restrictions as provided herein.

*     *     *

8

 

Attachment I

2011 Equity Incentive Plan

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