<PAGE>
As filed with the Securities and Exchange Commission on June 17, 1997
Registration No. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
PETsMART, INC.
----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
----------------------
Delaware 94-3024325
---------------------- ------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
----------------------
19601 N. 27th Avenue
Phoenix, AZ 85027
(602) 580-6100
----------------------------------------------------------------
(Address and telephone number of principal executive offices)
----------------------
1997 NON-OFFICER
EQUITY INCENTIVE PLAN
----------------------------------------------------------------
(Full title of the plan)
Samuel J. Parker
Chairman of the Board of Directors
and Chief Executive Officer
PETsMART, Inc.
19601 N. 27th Avenue
Phoenix, AZ 85027
(602) 580-6100
----------------------------------------------------------------
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
----------------------
Copies to:
Alan C. Mendelson, Esq.
Robert J. Brigham, Esq.
Cooley Godward LLP
Five Palo Alto Square
3000 El Camino Real
Palo Alto, CA 94306
(415) 843-5000
----------------------
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM OFFERING AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED PRICE PER SHARE PRICE REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Stock Options and
Common Stock (par value
$.0001) 1,135,000 $12.00 (1) $13,620,000.00 (1) $4,126.86
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Stock Options, Stock
Bonuses, Rights to
Purchase Restricted
Stock, Stock 665,000 $10.41 (2) $6,922,650.00 (2) $2,097.56
Appreciation Rights,
and Common Stock (par
value $.0001)
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Based on 1,135,000 options granted at exercise price of $12.00 per
share, in accordance with Rule 457(h) under the Securities Act of 1933,
as amended (the "Act").
(2) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(c) and Rule 457(h) under the Act.
The price per share and aggregate offering price are based upon the average
of the high and low prices of Registrant's Common Stock on June 11, 1997 as
reported on the Nasdaq National Market System.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
<PAGE>
PART II
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by PETsMART, Inc. (the "Company") with the
Securities and Exchange Commission are incorporated by reference into this
Registration Statement:
(a) The Company's Report on Form 10-K for the year ended February 2,
1997, (File No. 0-21888), filed on or about April 28, 1997, including all
material incorporated by reference to date.
(b) The Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended May 4, 1997, (File No. 0-21888), filed on or about June 11, 1997
including all material incorporated by reference therein.
(c) The Company's Current Report on Form 8-K/A, (File No. 0-21888), dated
December 18, 1996 and filed on or about February 14, 1997 amending the Company's
Current Report on Form 8-K, (File No. 0-21888), dated December 18, 1996 and
filed on or about December 31, 1996.
All reports and other documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part of this
registration statement from the date of the filing of such reports and
documents.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under Section 145 of the Delaware General Corporation Law the Company has
broad powers to indemnify its directors and officers against liabilities they
may incur in such capacities, including liabilities under the Securities Act.
The Company's By-laws require the Company to indemnify its directors and
executive officers, and permit the Company to indemnify its other officers,
employees and other agents, to the extent permitted by Delaware law. Under the
Company's By-laws, indemnified parties are entitled to indemnification for
negligence, gross negligence and otherwise to the fullest extent permitted by
law. The By-laws also require the Company to advance litigation expenses in the
case of stockholder derivative actions or other actions, against an undertaking
by the indemnified party to repay such advances if it is ultimately determined
that the indemnified party is not entitled to indemnification.
The Company has entered into indemnity agreements with each of its
directors and executive officers. Such indemnity agreements contain provisions
which are in some respects broader than the specific indemnification provisions
contained in Delaware law.
II-1.
<PAGE>
EXHIBITS
EXHIBIT
NUMBER
5.1 Opinion of Cooley Godward LLP.
23.1 (i) Consent of Price Waterhouse LLP.
(ii) Consent of Coopers & Lybrand L.L.P.
(iii) Consent of Deloitte & Touche LLP.
(iv) Consent of Davie, Kaplan & Braverman, P.C.
(v) Consent of Arthur Andersen LLP.
(vi) Consent of Grant Thornton.
23.2 Consent of Cooley Godward LLP is contained in Exhibit 5.1 to this
Registration Statement.
24.1 Power of Attorney is contained on the signature pages.
99.1 1997 Non-Officer Equity Incentive Plan.
99.2 Form of Nonstatutory Stock Option Grant used in connection with the
1997 Non-Officer Equity Incentive Plan.
II-2.
<PAGE>
ITEM 9. UNDERTAKINGS
1. The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) (Section 230.424(b) of this
chapter) if, in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraphs (a)(i) and (a)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the issuer pursuant to
section 13 or section 15(d) of the Exchange Act that are incorporated by
reference herein.
(b) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
2. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
II-3.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix, State of Arizona, on June 17, 1997.
PETsMART, INC.
By /s/ Samuel J. Parker
-------------------------------------------
Samuel J. Parker
Chairman of the Board of Directors
and Chief Executive Officer
(PRINCIPAL EXECUTIVE OFFICER)
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Samuel J. Parker and Susan C. Schnabel,
and each or any one of them, his true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, or any of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
II-4.
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Samuel J. Parker Chairman of the Board of June 17, 1997
- ------------------------------ Directors and Chief
Samuel J. Parker Executive Officer
(PRINCIPAL EXECUTIVE OFFICER)
/s/ Susan C. Schnabel Senior Vice President, Chief June 17, 1997
- ------------------------------ Financial Officer (PRINCIPAL
Susan C. Schnabel FINANCIAL OFFICER)
/s/ Kenneth A. Conway Vice President, Controller June 17, 1997
- ------------------------------ (PRINCIPAL ACCOUNTING OFFICER)
Kenneth A. Conway
/s/ Donna R. Ecton Chief Operating June 17, 1997
- ------------------------------ Officer and Director
Donna R. Ecton
- ------------------------------ Director
Denis L. Defforey
/s/ Philip L. Francis Director June 17, 1997
- ------------------------------
Philip L. Francis
/s/ Richard M. Kovacevich Director June 17, 1997
- ------------------------------
Richard M. Kovacevich
/s/ F. Richard Northcott Director June 17, 1997
- ------------------------------
F. Richard Northcott
II-5.
<PAGE>
SIGNATURE TITLE DATE
Director
- ------------------------------
Lawrence S. Phillips
/s/ Thomas G. Stemberg Director June 17, 1997
- ------------------------------
Thomas G. Stemberg
II-6.
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
5.1 Opinion of Cooley Godward LLP.
23.1 (i) Consent of Price Waterhouse LLP.
(ii) Consent of Coopers & Lybrand L.L.P.
(iii) Consent of Deloitte & Touche LLP.
(iv) Consent of Davie, Kaplan & Braverman, P.C.
(v) Consent of Arthur Andersen LLP.
(vi) Consent of Grant Thornton.
23.2 Consent of Cooley Godward LLP is contained in Exhibit 5.1 to this
Registration Statement.
24.1 Power of Attorney is contained on the signature pages.
99.1 1997 Non-Officer Equity Incentive Plan.
99.2 Form of Nonstatutory Stock Option Grant used in connection with the
1997 Non-Officer Equity Incentive Plan.
II-7.
<PAGE>
EXHIBIT 5.1
[LETTERHEAD OF COOLEY GODWARD LLP]
June 17, 1997
PETsMART, Inc.
19601 N. 27th Avenue
Phoenix, AZ 85027
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection
with the filing by PETsMART, Inc. (the "Company") of a Registration Statement
on Form S-8 (the "Registration Statement") with the Securities and Exchange
Commission covering the offering of up to 1,800,000 shares of the Company's
Common Stock, $.001 par value, (the "Shares") pursuant to its 1997
Non-Officer Equity Incentive Plan (the "Plan").
In connection with this opinion, we have examined the Registration Statement
and related Prospectus, your Certificate of Incorporation and By-laws, as
amended, and such other documents, records, certificates, memoranda and other
instruments as we deem necessary as a basis for this opinion. We have
assumed the genuineness and authenticity of all documents submitted to us as
originals, the conformity to originals of all documents submitted to us as
copies thereof, and the due execution and delivery of all documents where due
execution and delivery are a prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the opinion
that the Shares, when sold and issued in accordance with the Plan, the
Registration Statement and related Prospectus, will be validly issued, fully
paid, and nonassessable (except as to shares issued pursuant to certain
deferred payment arrangements, which will be fully paid and nonassessable
when such deferred payments are made in full).
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
COOLEY GODWARD LLP
/s/ Robert J. Brigham
By: Robert J. Brigham
<PAGE>
EXHIBIT 23.1(i)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 25, 1997, appearing on
page F-2 of PETsMART, Inc.'s Annual Report on Form 10-K for the year ended
February 2, 1997.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Phoenix, Arizona
June 11, 1997
<PAGE>
[LETTERHEAD]
EXHIBIT 23.1 (ii)
CONSENT OF INDEPENDENT ACCOUNTANTS
------------
We hereby consent to the incorporation by reference in the registration
statement of PETsMART, Inc. and Subsidiaries on Form S-8, Registration No. to
be assigned on or about June 13, 1997, of our report dated April 21, 1995 on
our audit of the financial statements of The Pet Food Giant, Inc., for the
year ended December 31, 1994, which report is included on Form 10-K of
PETsMART, Inc. for the fiscal year ended February 2, 1997.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Parsippany, New Jersey
June 11, 1997
<PAGE>
EXHIBIT 23.1 (iii)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of PETsMART, Inc. on Form S-8 of our report dated March 17, 1995 (June 21,
1995 as to Note 11)(which expresses an unqualified opinion and includes an
explanatory paragraph regarding a certain complaint) relating to the
consolidated financial statements of Petstuff, Inc. and subsidiaries for the
year ended January 29, 1995 appearing in the Annual Report on Form 10-K of
PETsMART, Inc. for the fiscal year ended February 2, 1997.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Atlanta, Georgia
June 11, 1997
<PAGE>
EXHIBIT 23.1 (iv)
[LETTERHEAD DAVIE, KAPLAN & BRAVERMAN]
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated June 9, 1995, appearing on page
F-26 of PETsMART, Inc.'s Annual Report on Form 10-K for the year ended
February 2, 1997.
/s/ Davie, Kaplan & Braverman, P.C.
DAVIE, KAPLAN & BRAVERMAN, P.C.
Rochester, New York
June 12, 1997
<PAGE>
EXHIBIT 23.1(v)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accounts, we hereby consent to the incorporation by
reference in this Form S-8 of our report dated March 22, 1996 on the
financial statements of State Line Tack, Inc. (the Company) as of December
31, 1994 and 1995, and for the three year period ended December 31, 1995
included in PETsMART, Inc.'s Form 10 K filed on April 28, 1997. It should be
noted that we have not audited any financial statements of the Company
subsequent to December 31, 1995 or performed any audit procedures subsequent
to the date of our report.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Boston, Massachusetts
June 11, 1997
<PAGE>
EXHIBIT 23.1 (vi)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated October 24, 1996 (except for Note O -
Subsequent Events - as to which the date is November 20, 1996) appearing on
page F-2c of PETsMART, Inc.'s Annual Report on Form 10-K for the year ended
February 2, 1997.
/s/ Grant Thornton
GRANT THORNTON
London, England
June 11, 1997
<PAGE>
Exhibit 99.1
PETsMART, INC.
1997 NON-OFFICER EQUITY INCENTIVE PLAN
ADOPTED BY THE BOARD OF DIRECTORS EFFECTIVE MAY 22, 1997
1. PURPOSES.
(a) The purpose of the Plan is to provide a means by which selected
Employees and Consultants may be given an opportunity to benefit from
increases in value of the common stock of the Company ("Common Stock")
through the granting of (i) Nonstatutory Stock Options, (ii) stock bonuses
and (iii) rights to purchase restricted stock.
(b) The Company, by means of the Plan, seeks to retain the services of
persons who are now Employees or Consultants, to secure and retain the
services of new Employees and Consultants and to provide incentives for such
persons to exert maximum efforts for the success of the Company and its
Affiliates.
(c) The Company intends that the Stock Awards issued under the Plan
shall, in the discretion of the Board, be either (i) Nonstatutory Stock
Options granted pursuant to Section 6 hereof or (ii) stock bonuses or rights
to purchase restricted stock granted pursuant to Section 7 hereof. All
Options shall be in such form as issued pursuant to Section 6.
2. DEFINITIONS.
(a) "AFFILIATE" means any parent corporation or subsidiary corporation,
whether now or hereafter existing, as those terms are defined in Sections 424(e)
and (f) respectively, of the Code, or such other parent corporation or
subsidiary corporation designated by the Board.
(b) "BOARD" means the Board of Directors of the Company.
(c) "CODE" means the Internal Revenue Code of 1986, as amended.
(d) "COMMITTEE" means a committee appointed by the Board in accordance
with subsection 3(c) of the Plan.
(e) "COMPANY" means PETsMART, Inc., a Delaware corporation.
1.
<PAGE>
(f) "CONSULTANT" means any person, including an advisor, engaged by the
Company or an Affiliate to render consulting services and who is compensated for
such services, provided that the term "Consultant" shall not include a Director.
(g) "CONTINUOUS STATUS AS AN EMPLOYEE OR CONSULTANT" means the service
relationship, whether as an Employee or a Consultant, is not interrupted or
terminated. The Board or the Committee, in that party's sole discretion, may
determine whether Continuous Status as an Employee or Consultant shall be
considered interrupted in the case of: (i) any leave of absence approved by the
Board, including sick leave, military leave, or any other personal leave or (ii)
transfers between locations of the Company or between the Company, Affiliates or
their successors.
(h) "DIRECTOR" means a member of the Board.
(i) "DISABILITY" means that an individual is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or which has lasted
for a sufficiently long period of time for the individual to be eligible under
the Company's policy of long-term disability insurance.
(j) "EMPLOYEE" means any person employed by the Company or any Affiliate
of the Company. Neither service as a Director nor payment of a director's fee
by the Company shall be sufficient to constitute "employment" by the Company.
(k) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
(l) "FAIR MARKET VALUE" means, as of any date, the value of the Common
Stock of the Company determined as follows:
(1) If the Common Stock is listed on any established stock exchange
or traded on the Nasdaq National Market or The Nasdaq SmallCap Market, the Fair
Market Value of a Share shall be the closing sales price for such Share (or the
closing bid, if no sales were reported) as quoted on such exchange or market (or
the exchange or market with the greatest volume of trading in the Common Stock)
on the last market trading day prior to the day of determination, as reported in
THE WALL STREET JOURNAL or such other source as the Board deems reliable.
(2) In the absence of such markets for the Common Stock, the Fair
Market Value shall be determined in good faith by the Board.
(m) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify as
an incentive stock option pursuant to Section 422 of the Code and the
regulations promulgated thereunder.
2.
<PAGE>
(n) "OFFICER" means a person who is an officer of the Company.
(o) "OPTION" means a Nonstatutory Stock Option granted pursuant to the
Plan.
(p) "OPTION AGREEMENT" means a written agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
Each Option Agreement shall be subject to the terms and conditions of the Plan.
(q) "OPTIONEE" means a person to whom an Option is granted pursuant to the
Plan.
(r) "PLAN" means this PETsMART, Inc. 1997 Non-Officer Equity Incentive
Plan.
(s) "SHARE" means a share of Common Stock of the Company.
(t) "STOCK AWARD" means any right granted under the Plan, including any
Option, any stock bonus and any right to purchase restricted stock.
(u) "SECURITIES ACT" means the Securities Act of 1933, as amended.
(v) "STOCK AWARD AGREEMENT" means a written agreement between the Company
and a holder of a Stock Award evidencing the terms and conditions of an
individual Stock Award grant. Each Stock Award Agreement shall be subject to
the terms and conditions of the Plan.
3. ADMINISTRATION.
(a) The Plan shall be administered by the Board unless and until the Board
delegates administration to a Committee, as provided in subsection 3(c).
(b) The Board shall have the power, subject to, and within the limitations
of, the express provisions of the Plan:
(1) To determine from time to time which of the persons eligible
under the Plan shall be granted Stock Awards; when and how each Stock Award
shall be granted; whether a Stock Award will be an Option, a stock bonus, a
right to purchase restricted stock or a combination of the foregoing; the
provisions of each Stock Award granted (which need not be identical), including
the time or times when a person shall be permitted to receive Shares pursuant to
a Stock Award and the number of Shares with respect to which a Stock Award shall
be granted to each such person.
(2) To construe and interpret the Plan and Stock Awards granted
under it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any
3.
<PAGE>
Stock Award Agreement, in a manner and to the extent it shall deem necessary
or expedient to make the Plan fully effective.
(3) To amend the Plan or a Stock Award as provided in Section 13.
(4) Generally, to exercise such powers and to perform such acts as
the Board deems necessary or expedient to promote the best interests of the
Company which are not in conflict with the provisions of the Plan.
(c) The Board may delegate administration of the Plan to a committee or
committees ("Committee") of one or more members of the Board. If administration
is delegated to a Committee, the Committee shall have, in connection with the
administration of the Plan, the powers theretofore possessed by the Board (and
references in this Plan to the Board shall thereafter be to the Committee),
subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board. The Board may
abolish the Committee at any time and revest in the Board the administration of
the Plan.
4. SHARES SUBJECT TO THE PLAN.
(a) Subject to the provisions of Section 12 relating to adjustments upon
changes in the Common Stock, the Shares that may be issued pursuant to Stock
Awards shall not exceed in the aggregate One Million Eight Hundred Thousand
(1,800,000) Shares. If any Stock Award shall for any reason expire or otherwise
terminate, in whole or in part, without having been exercised in full (or vested
in the case of restricted stock), the Shares not acquired under such Stock Award
shall revert to and again become available for issuance under the Plan.
(b) The Shares subject to the Plan may be unissued Shares or reacquired
Shares bought on the market or otherwise.
5. ELIGIBILITY.
Stock Awards may be granted only to Employees or Consultants who are not,
at the time of such grants, (i) Directors or (ii) Officers.
6. OPTION PROVISIONS.
Each Option shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. The provisions of separate
Options need not be identical, but
4.
<PAGE>
each Option shall include (through incorporation of provisions hereof by
reference in the Option or otherwise) the substance of each of the following
provisions:
(a) TERM. No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted or such longer or shorter term as may be
provided in the Option Agreement.
(b) PRICE. The exercise price of each Option shall be as determined by
the Board and shall be set forth in the Option Agreement.
(c) CONSIDERATION. The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall be
determined by the Board and may consist entirely of (i) cash or check, (ii)
promissory note (except that payment of the Share's "par value", as defined in
the Delaware General Corporation Law, shall not be made by deferred payment),
(iii) other Shares having a fair market value on the date of surrender equal to
the aggregate exercise price of the Shares as to which the Option shall be
exercised, including by delivering to the Company an attestation of ownership of
owned and unencumbered Shares in a form approved by the Company, (iv) payment
pursuant to a program developed under Regulation T as promulgated by the Federal
Reserve Board which, prior to the issuance of the Shares, results in either the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales
proceeds, (v) any combination of such methods of payment or (vi) such other
consideration and method of payment for the issuance of Shares to the extent
permitted under applicable law. In making its determination as to the type of
consideration to accept, the Board shall consider if acceptance of such
consideration may be reasonably expected to benefit the Company. In the case of
any deferred payment arrangement, interest shall be charged at the minimum rate
of interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement.
(d) TRANSFERABILITY. An Option may be transferred to the extent provided
in the Option Agreement; provided that if the Option Agreement does not
expressly permit the transfer of an Option, the Option shall not be transferable
except by will or by the laws of descent and distribution and shall be
exercisable during the lifetime of the person to whom the Option is granted only
by such person. Notwithstanding the foregoing, the person to whom the Option is
granted may, by delivering written notice to the Company, in a form satisfactory
to the Company, designate a third party who, in the event of the death of the
Optionee, shall thereafter be entitled to exercise the Option.
(e) VESTING. The total number of Shares subject to an Option may, but
need not, be allotted in periodic installments (which may, but need not, be
equal). The Option Agreement may provide that from time to time during each
of such installment periods, the Option may become exercisable ("vest") with
respect to some or all of the Shares allotted to that period, and may be
exercised with respect to some or all of the Shares allotted to such period
and/or any
5.
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prior period as to which the Option became vested but was not fully
exercised. The Option may be subject to such other terms and conditions on
the time or times when it may be exercised (which may be based on performance
or other criteria) as the Board may deem appropriate. The vesting provisions
of individual Options may vary. The provisions of this subsection 6(e) are
subject to any Option provisions governing the minimum number of Shares as to
which an Option may be exercised.
(f) TERMINATION OF EMPLOYMENT OR CONSULTING RELATIONSHIP.
(1) In the event an Optionee's Continuous Status as an Employee or
Consultant terminates (other than upon the Optionee's death or disability), the
Optionee may exercise his or her Option within such period of time designated by
the Board, which shall in no event be later than the expiration of the term of
the Option as set forth in the Option Agreement (the "Post-Termination Exercise
Period") and only to the extent that the Optionee was entitled to exercise the
Option on the date the Optionee's Continuous Status as an Employee or Consultant
terminates. The Board may at any time extend the Post-Termination Exercise
Period and provide for continued vesting during such extended period. If, as of
the date of termination, the Optionee is not entitled to exercise his or her
entire Option, the Shares covered by the unexercisable portion of the Option
shall revert to the Plan. If, after termination, the Optionee does not exercise
his or her Option within the time specified in the Option Agreement or as
otherwise determined above, the Option shall terminate, and the Shares covered
by such Option shall revert to the Plan. Notwithstanding the foregoing, the
Board shall have the power to permit an Option to vest, in whole or in part,
during the Post-Termination Exercise Period.
(2) An Optionee's Option Agreement may also provide that if the
exercise of the Option following the termination of the Optionee's Continuous
Status as an Employee or Consultant (other than upon the Optionee's death or
disability) would be prohibited at any time solely because the issuance of
Shares would violate the registration requirements under the Securities Act,
then the Option shall terminate on the earlier of (i) the expiration of the term
of the Option set forth in the first paragraph of this subsection 6(f), or (ii)
the expiration of a period of three (3) months after the termination of the
Optionee's Continuous Status as an Employee or Consultant during which the
exercise of the Option would not be in violation of such registration
requirements.
(g) DISABILITY OF OPTIONEE. In the event an Optionee's Continuous Status
as an Employee or Consultant terminates as a result of the Optionee's
Disability, the Optionee may exercise his or her Option (to the extent that the
Optionee was entitled to exercise it as of the date of termination), but only
within such period of time ending on the earlier of (i) the date twelve (12)
months following such termination (or such longer or shorter period specified in
the Option Agreement), or (ii) the expiration of the term of the Option as set
forth in the Option Agreement. If, at the date of termination, the Optionee is
not entitled to exercise his or her entire Option, the Shares covered by the
unexercisable portion of the Option shall revert to and again become available
for issuance under the Plan. If, after termination, the Optionee does not
6.
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exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to and again
become available for issuance under the Plan.
(h) DEATH OF OPTIONEE. In the event of the death of an Optionee during,
or within a period specified in the Option Agreement after the termination of,
the Optionee's Continuous Status as an Employee or Consultant, the Option may be
exercised (to the extent the Optionee was entitled to exercise the Option as of
the date of death) by the Optionee's estate, by a person who acquired the right
to exercise the Option by bequest or inheritance, but only within the period
ending on the earlier of (i) the date eighteen (18) months following the date of
death (or such longer or shorter period specified in the Option Agreement), or
(ii) the expiration of the term of such Option as set forth in the Option
Agreement. If, at the time of death, the Optionee was not entitled to exercise
his or her entire Option, the Shares covered by the unexercisable portion of the
Option shall revert to and again become available for issuance under the Plan.
If, after death, the Option is not exercised within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert
to and again become available for issuance under the Plan.
(i) EARLY EXERCISE. The Option may, but need not, include a provision
whereby the Optionee may elect at any time while an Employee or Consultant to
exercise the Option as to any part or all of the Shares subject to the Option
prior to the full vesting of the Option. Any unvested Shares so purchased may
be subject to a repurchase right in favor of the Company or to any other
restriction the Board determines to be appropriate.
(j) RE-LOAD OPTIONS.
(1) Without in any way limiting the authority of the Board to make or
not to make grants of Options hereunder, the Board shall have the authority (but
not an obligation) to include as part of any Option Agreement a provision
entitling the Optionee to a further Option (a "Re-Load Option") in the event the
Optionee exercises the Option evidenced by the Option Agreement, in whole or in
part, by surrendering other Shares in accordance with this Plan and the terms
and conditions of the Option Agreement. Any such Re-Load Option (i) shall be
for a number of Shares equal to the number of Shares surrendered as part or all
of the exercise price of such Option, (ii) shall have an expiration date which
is the same as the expiration date of the Option the exercise of which gave rise
to such Re-Load Option and (iii) shall have an exercise price which is equal to
one hundred percent (100%) of the Fair Market Value of the Shares subject to the
Re-Load Option on the date of exercise of the original Option.
(2) There shall be no Re-Load Options on a Re-Load Option. Any such
Re-Load Option shall be subject to the availability of sufficient Shares under
subsection 4(a) and shall be subject to such other terms and conditions as the
Board may determine which are not inconsistent with the express provisions of
the Plan regarding the terms of Options.
7.
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7. TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK.
Each stock bonus or restricted stock purchase agreement shall be in such
form and shall contain such terms and conditions as the Board shall deem
appropriate. The terms and conditions of stock bonus or restricted stock
purchase agreements may change from time to time, and the terms and conditions
of separate agreements need not be identical, but each stock bonus or restricted
stock purchase agreement shall include (through incorporation of provisions
hereof by reference in the agreement or otherwise) the substance of each of the
following provisions as appropriate:
(a) PURCHASE PRICE. The purchase price under each restricted stock
purchase agreement shall be such amount as the Board shall determine and
designate in such agreement. Notwithstanding the foregoing, the Board may
determine that eligible participants in the Plan may be awarded stock pursuant
to a stock bonus agreement in consideration for past services actually rendered
to the Company or for its benefit.
(b) TRANSFERABILITY. No rights under a stock bonus or restricted stock
purchase agreement shall be transferable except by will or the laws of descent
and distribution so long as stock awarded under such agreement remains subject
to the terms of any restrictive covenant (such as a repurchase option or
reacquisition option) in favor of the Company.
(c) CONSIDERATION. The purchase price of Shares acquired pursuant to a
stock purchase agreement shall be paid either: (i) in cash at the time of
purchase, (ii) at the discretion of the Board, according to a deferred payment
or other arrangement with the person to whom the Shares are sold, except that
payment of the common stock's "par value" (as defined in the Delaware General
Corporation Law) shall not be made by deferred payment, or (iii) in any other
form of legal consideration that may be acceptable to the Board in its
discretion. Notwithstanding the foregoing, the Board to which administration of
the Plan has been delegated may award stock pursuant to a stock bonus agreement
in consideration for past services actually rendered to the Company or for its
benefit.
(d) VESTING. Shares sold or awarded under the Plan may, but need not, be
subject to a repurchase option or reacquisition option in favor of the Company
in accordance with a vesting schedule to be determined by the Board.
(e) TERMINATION OF CONTINUOUS STATUS AS AN EMPLOYEE OR CONSULTANT. In the
event a Participant's Continuous Status as an Employee or Consultant terminates,
the Company may repurchase or otherwise reacquire any or all of the Shares held
by that person which have not vested as of the date of termination under the
terms of the stock bonus or restricted stock purchase agreement between the
Company and such person.
8.
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8. CANCELLATION AND RE-GRANT OF OPTIONS.
The Board shall have the authority to effect, at any time and from time to
time, (i) the repricing of any outstanding Options under the Plan and/or (ii)
with the consent of any adversely affected holders of Options, the cancellation
of any outstanding Options under the Plan and the grant in substitution therefor
of new Options under the Plan covering the same or different numbers of Shares.
9. COVENANTS OF THE COMPANY.
(a) During the terms of the Stock Awards, the Company shall keep available
at all times the number of Shares required to satisfy such Stock Awards.
(b) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell Shares under Stock Awards; provided, however, that this
undertaking shall not require the Company to register under the Securities Act
either the Plan, any Stock Award or any Shares issued or issuable pursuant to
any such Stock Award. If, after reasonable efforts, the Company is unable to
obtain from any such regulatory commission or agency the authority which counsel
for the Company deems necessary for the lawful issuance and sale of Shares under
the Plan, the Company shall be relieved from any liability for failure to issue
and sell Shares upon exercise of such Stock Awards unless and until such
authority is obtained.
10. USE OF PROCEEDS FROM SHARES.
Proceeds from the sale of Shares pursuant to Stock Awards shall constitute
general funds of the Company.
11. MISCELLANEOUS.
(a) The Board shall have the power to accelerate the time at which all or
any part of a Stock Award may first be exercised or the time during which a
Stock Award or any part thereof will vest, notwithstanding the provisions in the
Stock Award stating the time at which it may first be exercised or the time
during which it will vest.
(b) No Employee, Consultant or any person to whom an Option is transferred
in accordance with the Plan shall be deemed to be the holder of, or to have any
of the rights of a holder with respect to, any Shares subject to such Option
unless and until such person has satisfied all requirements for exercise of the
Option pursuant to its terms.
(c) Nothing in the Plan or any instrument executed or Stock Award
granted pursuant thereto shall confer upon any Employee, Consultant or other
holder of Stock Awards any right to continue in the employ of the Company or
any Affiliate or to continue serving as a Consultant
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or shall affect the right of the Company or any Affiliate to terminate the
employment of any Employee with or without notice and with or without cause,
or the right to terminate the relationship of any Consultant pursuant to the
terms of such Consultant's agreement with the Company or Affiliate.
(d) The Company may require any person to whom a Stock Award is granted,
or any person to whom a Stock Award is transferred in accordance with the Plan,
as a condition of exercising or acquiring Shares under any Stock Award, (i) to
give written assurances satisfactory to the Company as to such person's
knowledge and experience in financial and business matters and/or to employ a
purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters, and that he or
she is capable of evaluating, alone or together with the purchaser
representative, the merits and risks associated with the Stock Award, and
(ii) to give written assurances satisfactory to the Company stating that such
person is acquiring the Shares subject to the Stock Award for such person's own
account and not with any present intention of selling or otherwise distributing
the Shares. The foregoing requirements, and any assurances given pursuant to
such requirements, shall be inoperative if (i) the issuance of the Shares upon
the exercise or acquisition of Shares under the Stock Award has been registered
under a then currently effective registration statement under the Securities
Act, or (ii) as to any particular requirement, a determination is made by
counsel for the Company that such requirement need not be met in the
circumstances under the then applicable securities laws. The Company may, upon
advice of counsel to the Company, place legends on stock certificates issued
under the Plan as such counsel deems necessary or appropriate in order to comply
with applicable securities laws, including, but not limited to, legends
restricting the transfer of the Shares.
(e) To the extent provided by the terms of a Stock Award Agreement, the
person to whom a Stock Award is granted may satisfy any federal, state or local
tax withholding obligation relating to the exercise or acquisition of Shares
under a Stock Award by any of the following means or by a combination of such
means: (i) tendering a cash payment, (ii) authorizing the Company to withhold
Shares from the Shares otherwise issuable to the participant as a result of the
exercise or acquisition of Shares under the Stock Award or (iii) delivering to
the Company owned and unencumbered Shares, including by delivering to the
Company an attestation of ownership of owned and unencumbered Shares in a form
approved by the Company.
12. ADJUSTMENTS UPON CHANGES IN STOCK.
(a) If any change is made in the Shares subject to the Plan, or subject
to any Stock Award, without the receipt of consideration by the Company
(through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, stock
split, liquidating dividend, combination of Shares, exchange of Shares,
change in corporate structure or other transaction not involving the receipt
of consideration by the Company), the Plan will be appropriately adjusted in
the class(es) and maximum number of Shares subject to the Plan pursuant to
subsection 4(a), and the outstanding Stock Awards will
10.
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be appropriately adjusted in the class(es) and number of Shares and price per
Share subject to such outstanding Stock Awards. Such adjustments shall be
made by the Board, the determination of which shall be final, binding and
conclusive. (The conversion of any convertible securities of the Company
shall not be treated as a "transaction not involving the receipt of
consideration by the Company".)
(b) In the event of a Change in Control, (i) any surviving or acquiring
corporation shall assume Stock Awards outstanding under the Plan or shall
substitute similar Stock Awards for those outstanding under the Plan, or (ii) in
the event any surviving or acquiring corporation refuses to assume such Stock
Awards or to substitute similar Stock Awards for those outstanding under the
Plan, (A) with respect to Stock Awards held by persons then performing services
as Employees or Consultants, the vesting of such Stock Awards and the time
during which such Stock Awards may be exercised shall be accelerated prior to
such event and the Stock Awards terminated if not exercised after such
acceleration and at or prior to such event, and (B) with respect to any other
Stock Awards outstanding under the Plan, such Stock Awards shall be terminated
if not exercised prior to such event.
(c) In addition, with respect to any person who was providing services as
an Employee or Consultant immediately prior to the consummation of the Change in
Control, if such person's Continuous Status as an Employee or Consultant is
terminated other than for Cause within thirteen (13) months following
consummation of the Change in Control, then any Stock Awards held by such
persons shall immediately become fully vested and exercisable, and any
repurchase right by the Company with respect to Shares acquired by such person
under a Stock Award shall lapse. For purposes of the Plan, "Cause" shall mean
grossly negligent or willful conduct that is materially injurious to the
business of the person's employer, whether financial or otherwise.
(d) For purposes of this Plan, "Change in Control" means: (1) a
dissolution, liquidation, or sale of all or substantially all of the assets of
the Company, (2) a merger or consolidation in which the Company is not the
surviving corporation, (3) a reverse merger in which the Company is the
surviving corporation but Shares outstanding immediately preceding the merger
are converted by virtue of the merger into other property, whether in the form
of securities, cash or otherwise, or (4) the acquisition by any person, entity
or group within the meaning of Section 13(d) or 14(d) of the Exchange Act, or
any comparable successor provisions (excluding any employee benefit plan, or
related trust, sponsored or maintained by the Company or any Affiliate of the
Company) of the beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act, or comparable successor rule) of securities
of the Company representing at least fifty percent (50%) of the combined voting
power entitled to vote in the election of directors.
(e) In the event that any payment received or to be received by the
holder of a Stock Award ("Payment") would (i) constitute a "parachute
payment" within the meaning of Section 280G of the Code and (ii) but for this
subsection 12(e), be subject to the excise tax imposed by
11.
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Section 4999 of the Code (the "Excise Tax"), then, subject to the provisions
of subsection 12(f) hereof, such Payment shall be reduced to the largest
amount which such holder, in his or her discretion, determines would result
in no portion of the Payment being subject to the Excise Tax. The
determination by such holder of any required reduction pursuant to this
subsection 12(e) shall be conclusive and binding upon the Company. The
Company shall reduce a Payment in accordance with this subsection 12(e) only
upon written notice by such holder indicating the amount of such reduction,
if any. If the Internal Revenue Service (the "IRS") determines that a
Payment is subject to the Excise Tax, then subsection 12(f) hereof shall
apply, and the enforcement of subsection 12(f) shall be the exclusive remedy
to the Company for a failure by such holder to reduce the Payment so that no
portion thereof is subject to the Excise Tax.
(f) If, notwithstanding any reduction described in subsection 12(e) hereof
(or in the absence of any such reduction), the IRS determines that the holder of
a Stock Award is liable for the Excise Tax as a result of the receipt of a
Payment, then such holder shall be obligated to pay back to the Company, within
thirty (30) days after final IRS determination, an amount of the Payment equal
to the "Repayment Amount." The Repayment Amount with respect to a Payment shall
be the smallest such amount, if any, as shall be required to be paid to the
Company so that such holder's net proceeds with respect to any Payment (after
taking into account the payment of the Excise Tax imposed on such Payment) shall
be maximized. Notwithstanding the foregoing, the Repayment Amount with respect
to a Payment shall be zero if a Repayment Amount of more than zero would not
eliminate the Excise Tax imposed on such Payment. If the Excise Tax is not
eliminated pursuant to this subsection 12(f), such holder shall pay the Excise
Tax.
13. AMENDMENT OF THE PLAN AND STOCK AWARDS.
(a) The Board at any time, and from time to time, may amend the Plan.
(b) The Board, in its sole discretion, may submit the Plan and/or any
amendment to the Plan for stockholder approval.
(c) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide those eligible with
the maximum benefits provided or to be provided under the provisions of the Code
and the regulations promulgated thereunder.
(d) Rights and obligations under any Stock Award granted before amendment
of the Plan shall not be impaired by any amendment of the Plan unless (i) the
Company requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.
(e) The Board at any time, and from time to time, may amend the terms of
any one or more Stock Awards; provided, however, that the rights and obligations
under any Stock
12.
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Award shall not be impaired by any such amendment unless (i) the Company
requests the consent of the person to whom the Stock Award was granted and
(ii) such person consents in writing.
14. TERMINATION OR SUSPENSION OF THE PLAN.
(a) The Board may suspend or terminate the Plan at any time. Unless
sooner terminated, the Plan shall terminate when all Shares reserved for
issuance under the Plan have been issued and all such issued Shares are no
longer subject to a repurchase option or a reacquisition option in favor of the
Company. No Stock Awards may be granted under the Plan while the Plan is
suspended or after it is terminated.
(b) Rights and obligations under any Stock Award granted while the Plan is
in effect shall not be impaired by suspension or termination of the Plan, except
with the written consent of the person to whom the Stock Award was granted.
15. EFFECTIVE DATE OF PLAN.
The Plan shall become effective on May 22, 1997.
13.
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Exhibit 99.2
FORM OF NONSTATUTORY STOCK OPTION
____________________________, Optionee:
PETsMART, Inc. (the "Company"), pursuant to its 1997 Non-Officer Equity
Incentive Plan (the "Plan") has this day granted to you, the optionee named
above, an option to purchase shares of the common stock of the Company
("Common Stock"). This option is not intended to qualify and will not be
treated as an "incentive stock option" within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
The grant hereunder is in connection with and in furtherance of the
Company's compensatory benefit plan for participation of the Company's
employees (excluding officers and directors) or consultants and is subject to
the terms and conditions of the Plan.
The details of your option are as follows:
1. The total number of shares of Common Stock subject to this option is
________________ (__________). The date that vesting begins on this option is
______________________________ (the "vesting commencement date"). Subject to
the limitations contained herein, _____________________ of the total number of
shares subject to this option shall be exercisable at ________________________
____________________________ until either (i) you cease to provide services for
the Company for any reason or (ii) this option becomes fully vested.
2. (a) The exercise price of this option is ____________ ($_______) per
share.
(b) Payment of the exercise price per share is due in full upon
exercise of all or any part of each installment which has accrued to you.
You may elect, to the extent permitted by applicable statutes and
regulations, to make payment of the exercise price under one of the following
alternatives:
(i) Payment of the exercise price per share in cash
(including check) at the time of exercise;
(ii) Payment pursuant to a program developed under
Regulation T as promulgated by the Federal Reserve Board which results in the
receipt of cash (or check) by the Company prior to the issuance of Common
Stock;
(iii) Provided that at the time of exercise the Company's
Common Stock is publicly traded and quoted regularly in the Wall Street
Journal, payment by delivery of already-owned shares of Common Stock, held
for the period required to avoid a charge to the Company's reported earnings,
and owned free and clear of any liens, claims, encumbrances or security
interests, which Common Stock shall be valued at its fair market value on the
date of exercise; or
1.
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(iv) Payment by a combination of the methods of payment
permitted by subparagraph 2(b)(i) through 2(b)(iii) above.
3. This option may not be exercised for any number of shares which
would require the issuance of anything other than whole shares.
4. Notwithstanding anything to the contrary contained herein, this
option may not be exercised unless the shares issuable upon exercise of this
option are then registered under the Securities Act of 1933, as amended (the
"Securities Act"), or, if such shares are not then so registered, the Company
has determined that such exercise and issuance would be exempt from the
registration requirements of the Securities Act.
5. The term of this option commences on the date hereof and, unless
sooner terminated as set forth below or in the Plan, terminates on
_____________________ (which date shall be no more than ten (10) years from
the date this option is granted). In no event may this option be exercised
on or after the date on which it terminates. This option shall terminate
prior to the expiration of its term as follows: three (3) months after the
termination of your employment with the Company or an affiliate of the
Company (as defined in the Plan) for any reason or for no reason unless:
(a) such termination of employment is due to your disability (as
defined in the Plan), in which event the option shall terminate on the
earlier of the termination date set forth above or twelve (12) months
following such termination of employment; or
(b) such termination of employment is due to your death, in which
event the option shall terminate on the earlier of the termination date set
forth above or eighteen (18) months after your death; or
(c) during any part of such three (3) month period the option is
not exercisable solely because of the condition set forth in paragraph 4
above, in which event the option shall not terminate until the earlier of the
termination date set forth above or until it shall have been exercisable for
an aggregate period of three (3) months after the termination of employment;
or
(d) exercise of the option within three (3) months after
termination of your employment with the Company or with an affiliate would
result in liability under Section 16(b) of the Securities Exchange Act of
1934, in which case the option will terminate on the earlier of (i) the
termination date set forth above, (ii) the tenth (10th) day after the last
date upon which exercise would result in such liability or (iii) six (6)
months and ten (10) days after the termination of your employment with the
Company or an affiliate.
However, this option may be exercised following termination of
employment only as to that number of shares as to which it was exercisable on
the date of termination of employment under the provisions of paragraph 1 of
this option.
6. (a) This option may be exercised, to the extent specified above,
by delivering a notice of exercise (in a form designated by the Company)
together with the exercise price to
2.
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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 subparagraph 11(d) of
the Plan.
(b) You and the Company may agree that you may satisfy any
federal, state or local tax withholding obligation relating to the exercise
or acquisition of shares of Common Stock under this option by any of the
following means or by a combination of such means: (i) tendering a cash
payment, (ii) authorizing the Company to withhold shares of Common Stock from
the shares of Common Stock otherwise issuable to you as a result of the
exercise or acquisition of shares of Common Stock under this option or (iii)
delivering to the Company owned and unencumbered shares of Common Stock,
including by delivering to the Company an attestation of ownership of owned
and unencumbered shares of Common Stock in a form approved by the Company.
By exercising this option you hereby agree that the Company may require you
to enter an arrangement providing for the cash payment by you to the Company
of any tax withholding obligation of the Company arising by reason of the
exercise of this option, the lapse of any substantial risk of forfeiture to
which the shares are subject at the time of exercise or the disposition of
shares acquired upon such exercise.
7. This option is not transferable, except by will or by the laws of
descent and distribution or pursuant to a qualified domestic relations order
as defined in the Code or Title I of the Employee Retirement Income Security
Act (a "QDRO"), and is exercisable during your life only by you or a
transferee pursuant to a QDRO. By delivering written notice to the Company,
in a form satisfactory to the Company, you may designate a third party who,
in the event of your death, shall thereafter be entitled to exercise this
option.
8. This option is not an employment contract, and nothing in this
option shall be deemed to create in any way whatsoever any obligation on your
part to continue in the employ of the Company or on the part of the Company
to continue your employment with the Company. In the event that this option
is granted to you in connection with the performance of services as a
consultant, references to employment, employee and similar terms shall be
deemed to include the performance of services as a consultant, PROVIDED,
HOWEVER, that no rights as an employee shall arise by reason of the use of
such terms.
9. Any notices provided for in this option or the Plan shall be given
in writing and shall be deemed effectively given upon receipt or, in the case
of notices delivered by the Company to you, five (5) days after deposit in
the United States mail, postage prepaid, addressed to you at the address
specified below or at such other address as you hereafter designate by
written notice to the Company.
10. This 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 this
option, including without limitation the provisions of paragraph 6 of the
Plan relating to option provisions. This option is further subject to all
interpretations, amendments, rules and regulations which may from time to
time be
3.
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promulgated and adopted pursuant to the Plan. In the event of any conflict
between the provisions of this option and those of the Plan, the provisions
of the Plan shall control.
Dated the ____ day of __________________, 19__.
Very truly yours,
PETsMART, Inc.
By __________________________________________
Duly authorized on behalf
of the Board of Directors
ATTACHMENTS:
PETsMART, Inc. 1997 Non-Officer Equity Incentive Plan
Notice of Exercise
4.
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The undersigned:
(a) Acknowledges receipt of the foregoing option and the attachments
referenced therein and understands that all rights and liabilities with
respect to this option are set forth in the option and the Plan; and
(b) Acknowledges that as of the date of grant of this option, it sets
forth the entire understanding between the undersigned optionee and the
Company and its affiliates regarding the acquisition of stock in the Company
and supersedes all prior oral and written agreements on that subject with the
exception of (i) the options previously granted and delivered to the
undersigned under stock option plans of the Company and (ii) the following
agreements only:
NONE _____________
(Initial)
OTHER ______________________________
______________________________
______________________________
______________________________________
OPTIONEE
Address: ___________________________
___________________________
5.
