Document:

PETM - 2014.02.02 - EX 10.32

PETSMART, INC.
NONSTATUTORY STOCK OPTION GRANT NOTICE
(2011 EQUITY INCENTIVE PLAN) 

    
PetSmart, Inc. (the “Company”), pursuant to its 2011 Equity Incentive Plan (the “Plan”) hereby grants to Participant a stock option to purchase the number of shares of the Company’s common stock (the “Common Stock”) set forth below (the “Option”).  The Option 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. Defined terms not explicitly defined in this Nonstatutory Stock Option Grant Notice (this “Grant Notice”) but defined in the Plan shall have the same definitions as in the Plan.
Participant:               %%FIRST_NAME%-%  %%MIDDLE_NAME%-% %%LAST_NAME%-%
Date of Grant:    %%GRANT_DATE%-%
Number of Shares Subject to Option:    %%TOTAL _SHARES_GRANTED%-%
Exercise Price (per share):    %%OPTION_PRICE%-%
Vesting Commencement Date:    %%OPTION_DATE%-%
Email Address:        
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 the Option and supersede all prior oral and written agreements on that subject with the exception of Options previously granted and delivered to Participant under the Plan.  Notwithstanding the foregoing, if you are eligible to participate in the Executive Change in Control and Severance Benefit Plan (the “Executive Severance Plan”), the Option shall be subject to the terms of the Executive Severance Plan to the extent expressly provided therein.  

The details of the Option are as follows:

1.    VESTING.  Subject to the limitations contained herein, the Option will vest as follows:

(a)    Shares subject to the Option shall become vested and 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 your Continuous Status as an Employee, Director, or Consultant ceases for any reason prior to any such anniversary date.   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. 

(b)    If your Continuous Status as an Employee, Director, or Consultant ends due to your death or Disability, any unvested portion of the Option shall automatically become fully vested and exercisable.  

(c)    If you are age fifty-five (55) or older with at least five (5) years of Continuous Status as an Employee, Director, or Consultant on the date your Continuous Status as an Employee, Director, or Consultant ends and such termination is due to your voluntary retirement from the Company or an Affiliate and has been designated by the Company, in its sole discretion, as a retirement (a “Retirement Termination”), any unvested portion of the Option that has been outstanding for at least six (6) months, will continue to vest until the earlier of the Fixed Termination Date (as defined below) or the date of the third anniversary of termination of your Continuous Status as an Employee, Director or Consultant, provided (i) you were not a retirement eligible executive officer subject to Section 16 of the Securities and Exchange Commission Act of 1934, as amended, on March 22, 2011; (ii) your retirement is approved by the Company prior to your termination date; and (iii) 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.   
2.    EXERCISE PRICE.  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.  To the extent permitted by applicable statutes and regulations, you may make payment of the exercise price under one or any combination of the following alternatives:

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

(b)    Provided that at the time of exercise of the 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 classification of the Option as a liability for financial accounting purposes 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 the 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 the 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

(c)    Having the Company withhold shares of Common Stock from the shares of Common Stock otherwise issuable to you on exercise of the Option that have an aggregate Fair Market Value equal to the aggregate exercise price of the shares being purchased under the Option; or

(d)    Provided that at the time of exercise of the Option the Common Stock is publicly traded and quoted regularly in The Wall Street Journal, by delivery of a properly executed exercise agreement or notice, together with irrevocable instructions to a brokerage firm designated or approved by the Company to deliver promptly to the Company the aggregate amount of proceeds to pay the Option exercise price and any withholding obligations that may arise in connection with the exercise, all in accordance with the regulations of the Federal Reserve Board; or

(e)    Any other method permitted by the Committee.

3.    No FRACTIONAL SHARES.  The Option may not be exercised for any number of shares, which would require the issuance of anything other than whole shares.

4.    SECURITIES LAW COMPLIANCE.  Notwithstanding anything to the contrary contained herein, the Option may not be exercised unless the shares issuable upon exercise of the Option are then registered under 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 the Option must also comply with other applicable laws and regulations governing the Option, and you may not exercise the Option if the Company determines that such exercise would not be in material compliance with such laws and regulations.

      5.    OPTION TERM.  The term of the 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 seven (7) years from the Grant Date.  In no event may the Option be exercised on or after the Fixed Termination Date. The Option shall terminate on the earlier of the Fixed Termination Date or on the date that is three (3) months after your Continuous Status as an Employee, Director, or Consultant ends for any reason or for no reason unless:

(a)    termination of your Continuous Status as an Employee, Director, or Consultant is due to Disability, in which event the Option shall terminate on the earlier of the Fixed Termination Date or the date of the third anniversary of the end of your Continuous Status as an Employee, Director, or Consultant due to Disability; or

(b)    termination of your Continuous Status as an Employee, Director, or Consultant is due to your death, in which event the Option shall terminate on the earlier of the Fixed Termination Date or the date of the third anniversary of your death; or

(c)    termination of your Continuous Status as an Employee, Director or Consultant is a Retirement Termination, in which event the portion of the Option that has been outstanding for at least six (6) months, shall terminate on the earlier of the Fixed Termination Date or the date of the third anniversary of the end of your Continuous Status as an Employee, Director, or Consultant due to such retirement.

However, the Option may be exercised following such termination of your Continuous Status as an Employee, Director, or Consultant only as to that number of shares exercisable under the provisions of paragraph 1 of this Grant Notice.

6.    METHOD OF EXERCISE; TAX WITHHOLDING.

(a)    The 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 the terms of the Plan. 
    
(b)    By exercising the Option you agree that, as a condition to any exercise of the 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 the Option; or (2) the disposition of shares acquired upon such exercise. You may not exercise the Option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied.  Accordingly, you may not be able to exercise the Option when desired even though the 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.

7.    NON-TRANSFERABILITY OF THE OPTION.  The 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 the Option. 

8.    NO DIVIDENDS.  The Option does not entitle you to receive, on exercise, an amount equal to all or part of the dividends declared and paid on the number of shares of Common Stock underlying the Option between the Grant Date and the exercise date.

9.    OPTION NOT A SERVICE CONTRACT.  The Option is not an employment or other service contract and nothing in the 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.  

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

11.    BOOK ENTRY REGISTRATION OF SHARES; RESTRICTIVE LEGENDS.  The Company may issue any shares of Common Stock in respect of the Option by registering the shares in book entry form with the Company’s transfer agent in your name in which case the applicable restrictions will be noted in the records of the Company’s transfer agent in the book entry system.  Any certificates representing the shares of Common Stock issued in respect of the Option shall have endorsed thereon appropriate legends as determined by the Company.

12.    RIGHTS AS STOCKHOLDER.  You shall not have voting or any other rights as a stockholder of the Company with respect to the shares to be issued upon exercise of the Option until such shares are issued to you.  Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company.   

13.    GOVERNING PLAN DOCUMENT.  The 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 the Option, including without limitation the provisions of Section 6 of the Plan relating to Option provisions.  The 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 the Option and those of the Plan, the provisions of the Plan shall control.

14.    AMENDMENT.  No modification or amendment of this Grant Notice or waiver of any rights hereunder shall be valid unless in writing and duly signed by a party authorized by each party hereto.  

*  *  *

This Grant Notice shall be deemed to be signed by the Company and the Participant upon the Participant’s delivery, by electronic means or otherwise, of this Grant Notice to the Stock Plan Administration Manager of the Company or its designee.
    

ATTACHMENTS:

    
PetSmart, Inc. 2011 Equity Incentive Plan
PetSmart, Inc. 2011 Equity Incentive Plan Prospectus
    
    

March 18, 2014PETM - 2014.02.02 - EX 10.33

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 this Performance Share Unit Grant Notice (this “Grant Notice”) and the Plan, the terms of the Plan shall control.  
Participant:                             %%FIRST_NAME%-%  %%MIDDLE_NAME%-% %%LAST_NAME%-%
Date of Grant:                    %%GRANT_DATE%-%    
Performance Period                    February 4, 2013 to January 31, 2016
Target Number of Performance Share Units (“PSUs”)                %%TOTAL _SHARES_GRANTED%-%
Minimum Number of PSUs Granted       0 % of %%TOTAL _SHARES_GRANTED%-% PSUs
Maximum Number of PSUs Granted      200% of %%TOTAL _SHARES_GRANTED%-% 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 with the exception of PSUs previously granted and delivered to Participant under the Plan.  Notwithstanding the foregoing, if the Participant is eligible to participate in the Executive Change in Control and Severance Benefit Plan (the “Executive Severance Plan”), the PSU Grant shall be subject to the terms of the Executive Severance Plan to the extent expressly provided therein.

The details of the PSU Grant are as follows:
1.PSU GRANT.     Each awarded PSU represents the right to receive on a future date one share of the Company’s common stock (the “Common Stock”), subject to all of the terms and conditions of this Grant Notice and the Plan.   However, the number of PSUs subject to the 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 PSUs shall be created, and the Committee shall, in its discretion, determine an equivalent benefit for any fractional PSUs that might be created by such adjustments.  
2.    NUMBER OF AWARDED PSUS.  The actual number of PSUs to be awarded to you will be determined as follows:
(a)    The actual number of PSUs to be awarded to you may not exceed the Maximum Number of PSUs Granted pursuant to this Grant Notice, as indicated above.  The number of PSUs 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 Schedule A attached hereto.
(b)    No later than thirty (30) days after the receipt by the Committee of the financial results for the final fiscal year of the Performance Period applicable to the PSU Grant, the Committee shall determine whether the established Performance Conditions for the PSU Grant were achieved, and the number of PSUs subject to the PSU Grant to be awarded to you.  PSUs shall not be awarded based upon the attainment of Performance Conditions unless and until the Committee makes such determination. The Committee shall have discretion to reduce the number of PSUs that are awarded depending on (i) the extent to which the designated Performance Conditions 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 PSUs 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 PSUs 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 in Control” as such term is defined in Section 15(c) the Plan.  If you are then performing services as an Employee, Director or Consultant and the Performance Conditions are satisfied due to a Change of Control Transaction as provided in subsection (i) of this paragraph, then 100% of your target number of PSUs will be awarded immediately prior to the Change of Control Transaction, and if the Performance Conditions are satisfied due to a Change of Control Transaction as provided in subsection (ii) of this paragraph, then 100% of your target number of PSUs will be deemed earned immediately prior to the Change of Control Transaction but will not be awarded until the expiration of the Performance Period, or earlier if the acceleration provisions of Section 15(c) of the Plan apply.
(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)    Any PSUs subject to the 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 PSUs. 
3.    VESTING.   Subject to the limitations contained herein, any PSUs that are awarded by the Committee based upon satisfaction of the Performance Conditions or as otherwise provided in this Grant Notice  will be fully vested as of the date such PSUs are awarded. PSUs that have vested  as set forth in this Section 3 are “Vested Units.”  PSUs that are not Vested Units are “Unvested 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.
(a)    Death or Disability.  If your Continuous Status as an Employee, Director or Consultant ends due to death or Disability, the number of PSUs to be awarded under the PSU Grant shall be based on your target number of PSUs and shall be prorated over the Performance Period by reference to the number of months of service you completed after the commencement of the Performance Period as a fraction against 36 months (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 Performance Period, the number of PSUs to be awarded under the PSU Grant shall be determined based solely on the financial results as set forth in Section 2, and as further 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.  

		
	•
	The number of PSUs to be awarded under the PSU Grant shall be equal to the product of (i) your target number of PSUs prorated over the Performance Period by reference to the number of months of service you completed after the commencement of the Performance Period as a fraction against 36 months (with any fractional or partial month eliminated), not to exceed one hundred percent (100%) and (ii) the performance modifier achieved for the Performance Period.  

(c)    Forfeiture. Any Unvested 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 Unvested Units.
4.    SECURITIES LAW COMPLIANCE.  Notwithstanding anything to the contrary contained herein, the Company is not required to issue any shares of Common Stock in respect of the 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.  The issuance of shares under the PSU Grant also must comply with other applicable laws and regulations governing the 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.  The Company will deliver to you a number of shares of Common Stock equal to the number of Vested Units subject to the PSU Grant and a lump sum cash payment equal to any dividend equivalents credited to you pursuant to Section 6 within sixty (60) days following the end of the Performance Period. 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.  Notwithstanding the foregoing, in the event you die or become Disabled before the end of the Performance Period, issuance of the shares of Common Stock and payment in cash of your dividend equivalents shall be made within sixty (60) days following your death or Disability, as applicable. 
6.    DIVIDENDS.   The Company shall maintain a notional account pursuant to which you will be credited with a nominal amount equal to any cash dividend, stock dividend or other distribution made during the Performance Period that does not result from a capitalization adjustment as provided in the Plan based on your target number of PSUs. The amount of dividend equivalents payable, if any, shall equal the amounts credited to your notional account under this Section 6 for the Performance Period (prorated as provided in Section 3(b), as applicable) multiplied by the actual performance modifier achieved for the Performance Period, subject to any applicable withholding. Notwithstanding the foregoing, if your service with the Company terminates before the end of the Performance Period due to your death or Disability, no additional dividend equivalents shall be credited to your notional account after your death or Disability and you shall receive only the nominal amount of dividend equivalents credited to you without any adjustment based on the performance modifier. All amounts credited under this Section 6 shall be paid to you in cash at the time of issuance of shares of Common Stock under Section 5. Your dividend equivalents shall not be eligible to accrue interest at any time.
7.    NON-TRANSFERABILITY OF THE PSU GRANT.   The PSU Grant 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”).  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.    BOOK ENTRY REGISTRATION OF SHARES; RESTRICTIVE LEGENDS.  The Company may issue any shares of Common Stock in respect of the PSU Grant by registering the shares in book entry form with the Company’s transfer agent in your name in which case the applicable restrictions will be noted in the records of the Company’s transfer agent in the book entry system.  Any certificates representing the shares of Common Stock issued in respect of the PSU Grant shall have endorsed thereon appropriate legends as determined by the Company.
9.    PSU GRANT NOT A SERVICE CONTRACT.  The PSU Grant is not an employment or service contract, and nothing in the 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 the 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 the 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 the PSU Grant (the “Withholding Taxes”).  You may satisfy all or any portion of the Withholding Taxes obligation relating to the PSU Grant by any of the following means or by a combination of such means: (i) having the Company withhold from any compensation otherwise payable to you by the Company; (ii) having the Company withhold from any cash payable to you with respect to any dividend equivalents; (iii) tendering a cash payment to the Company; or (iv) having the Company withhold 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 you pursuant to Section 5) equal to the 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.  The PSU Grant is unfunded, and as a holder of Vested Units, 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.  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.    RIGHTS AS STOCKHOLDER.  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.   
13.    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 the PSU Grant.
14.    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 the 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 Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
15.    MISCELLANEOUS.
(a)    The rights and obligations of the Company under the 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 the 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 the PSU Grant.
(c)    You acknowledge and agree that you have reviewed the PSU Grant in its entirety, have had an opportunity to obtain the advice of counsel and fully understand all provisions of the 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.
16.    GOVERNING PLAN DOCUMENTS.  The PSU Grant is subject to all the provisions of the Plan, the provisions of which are hereby made a part of the 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.
17.    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.
18.    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. The Company expressly reserves its rights to amend, modify, or terminate any of the Company’s or any affiliate’s employee benefit plans.
19.    CHOICE OF LAW.  The interpretation, performance and enforcement of this Grant Notice will be governed by the law of the state of Arizona without regard to such state’s conflicts of laws rules.
20.    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 Grant Notice, 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.
*    *    *
This Grant Notice shall be deemed to be signed by the Company and the Participant upon the Participant’s delivery, by electronic means or otherwise, of this Grant Notice to the Stock Plan Administration Manager of the Company or its designee.

ATTACHMENTS:

    
PetSmart, Inc. 2011 Equity Incentive Plan
PetSmart, Inc. 2011 Equity Incentive Plan Prospectus

March 18, 2014

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