8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report: March 15, 2006

Date of Earliest Event Reported: March 13, 2006

The Pep Boys - Manny, Moe & Jack

(Exact name of registrant as specified in charter)

Pennsylvania	1-3381	23-0962915
(State or other jurisdiction of	(Commission	(I.R.S. Employer ID number)
incorporation or organization)	File No.)
3111 W. Allegheny Ave. Philadelphia, PA		19132
(Address of principal executive offices)		(Zip code)

215-430-9000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01Entry Into a Material Definitive Agreement

On March 13, 2006, The Pep Boys – Manny, Moe & Jack (the “Company”) amended its Non-Competition Agreement with Hal Smith, Executive Vice President – Merchandising & Marketing, to extend the post-employment covenant period thereunder from one to two years. In exchange for such covenants against competition, Mr. Smith’s severance benefits were expanded to provide him with (i) a severance payment equal to two years base salary and (ii) the immediate vesting and exerciseability of all non-vested stock-based awards then held by him.

Item 9.01Exhibits

Exhibit 99.1Non-Competition Agreement, dated March 13, 2006, between the Company and Hal Smith

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

THE PEP BOYS - MANNY, MOE & JACK
By:	/s/ Harry F. Yanowitz
	Harry F. Yanowitz
	Senior Vice President and
	Chief Financial Officer

Date:  March 15, 2006

3

EX-99.1

Exhibit 99.1

NON-COMPETITION AGREEMENT

This Non-Competition Agreement (this “Agreement”) is made by and between The Pep Boys-Manny, Moe & Jack, a Pennsylvania corporation (the “Company”), and Hal Smith (the “Officer”), on this 13th day of March 2006 (the “Effective Date”).

WHEREAS, the parties are currently party to a Non-Competition Agreement, dated February 3, 2004 (the “Former Agreement”);

WHEREAS, the Officer currently has a severance benefit granted by the Company pursuant to that certain Offer Letter, dated July 17, 2003, between the parties (the “Offer Letter”);

WHEREAS, the parties wish to amend and restate the Former Agreement and amend the severance benefit contained in the Offer Letter in order to provide the Officer with the enhanced severance benefit provided herein; and

WHEREAS, in exchange for the enhanced severance benefit provided herein, the Officer is willing to grant the covenant against competition contained herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and incorporating the foregoing recitals, the parties agree as follows:

1.Severance Benefit.

a.(i) If the Officer’s employment shall be terminated by the Company without Cause (as defined below) on or prior to February 27, 2013, and the Officer executes, and does not revoke, the Company’s then current standard separation and release agreement, (A) the Company shall pay to the Officer, within ten days of his termination date, a lump sum equal to two times his then current base salary and (B) all non-vested stock-based awards then held by the Executive shall immediately become fully vested and exerciseable.

(ii) If the Officer’s employment shall be terminated by the Company without Cause (as defined below) after February 27, 2013, and the Officer executes, and does not revoke, the Company’s then current standard separation and release agreement, the Company shall pay to the Officer, within ten days of his termination date, a lump sum equal to one times his then current base salary.

(iii) Notwithstanding anything to the contrary contained herein, no severance benefit provided for under this Section 1 shall be payable/operable if the Officer’s employment shall be terminated during such Officer’s Employment Period (as defined in that certain Employment Agreement between the Company and the Officer (the “Change in Control Agreement”)). During the Employment Period, the Change of Control Agreement shall supercede this Agreement in its entirety.

b.For the purposes of this Agreement, “Cause” shall mean (i) the continued failure of the Officer to perform substantially his duties with the Company (other than any such failure resulting from the Officer’s incapacity due to physical or mental illness), (ii) any act by the Officer of illegality, dishonesty or fraud in connection with the Officer’s employment, (iii) the willful engaging by the Officer in gross misconduct which is demonstrably and materially injurious to the Company or its affiliates, (iv) the Officer’s conviction of or pleading guilty or no contest to a felony, or (v) a violation of Section 2 hereof.

2.Covenant Against Competition.

a.The Officer shall not, during his employment with the Company and (i) if the Officer’s employment shall be terminated on or prior to February 27, 2013, for two years thereafter or (ii) if the Officer’s employment shall be terminated after February 27, 2013, for one year thereafter, directly or indirectly, induce or attempt to influence any employee of the Company to terminate his employment with the Company or hire or solicit for hire on behalf of another employer any person then employed or who had been employed by the Company during the immediately preceding six months.

b.The Officer shall not, during his employment with the Company and (i) if the Officer’s employment shall be terminated on or prior to February 27, 2013, for two years thereafter or (ii) if the Officer’s employment shall be terminated after February 27, 2013, for one year thereafter, unless the Officer is terminated by the Company without Cause, directly or indirectly, engage in (as a principal, partner, director, officer, agent, employee, consultant or otherwise) or be financially interested in any business operating within the United States of America, if (i) such business’ primary business is the retail and/or commercial sale of automotive parts, accessories, tires and/or repair/maintenance services including, without limitation, the entities (including their franchisees and affiliates) listed on Schedule 2(b) hereto, or (ii) the retail and/or commercial sale of automotive parts, accessories, tires and/or repair/maintenance services is the primary focus of such engagement or financial interest. However, nothing contained in this Section 2b shall prevent the Officer from holding for investment up to two percent (2%) of any class or equity securities of a company whose securities are traded on a national or foreign securities exchange.

c.Officer acknowledges that the restrictions contained in this Section 2, in view of the nature of the business in which the Company is engaged, are reasonable and necessary in order to protect the legitimate interests of the Company, and that any violation thereof would result in irreparable injuries to the Company, and the Officer therefore acknowledges that, in the event of his violation of any of these restrictions, the Company shall be entitled to obtain from any court of competent jurisdiction preliminary and permanent injunctive relief (without the posting of any bond) as well as damages and an equitable accounting of all earnings, profits and other benefits arising from such a violation, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled.

d.If the Officer violates any of the restrictions contained in this

2

Section 2, the restrictive period shall be extended from the time of the commencement of any such violation until such time as such violation shall be cured by the Officer to the satisfaction of the Company.

e.The invalidity or unenforceability of any provision or provisions of this Section 2 shall not affect the validity or enforceability of any other provision or provisions of this Section 2, which shall remain in full force and effect. If any provision of this Section 2 is held to be invalid, void or unenforceable in any jurisdiction, any court or arbitrator so holding shall substitute a valid, enforceable provision that preserves, to the maximum lawful extent, the terms and intent of this Agreement and shall correspondingly modify the Company’s obligations under Section 1. If any of the provisions of, or covenants contained in, this Section 2 are hereafter construed to be invalid or unenforceable in any jurisdiction, the same shall not affect the remainder of the provisions or the enforceability thereof in any other jurisdiction, which shall be given full effect, without regard to the invalidity or unenforceability in such other jurisdiction. Any such holding shall affect such provision of this Section 2, solely as to that jurisdiction, without rendering that or any other provisions of this Section 2 invalid, illegal, or unenforceable in any other jurisdiction. If any covenant contained in this Section 2 should be deemed invalid, illegal or unenforceable because its scope is considered excessive, such covenant will be modified so that the scope of the covenant is reduced only to the minimum extent necessary to render the modified covenant valid, legal and enforceable and a corresponding reduction in the scope of the Company’s obligations under Section 1 shall also be made.

3.Miscellaneous.

a.This Agreement shall inure to the benefit of and be binding upon the Company and its successors.

b.This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania without reference to principles of conflict of laws. The parties hereto agree that exclusive jurisdiction of any dispute regarding this Agreement shall be the state or federal courts located in Philadelphia, Pennsylvania. EACH PARTY HEREBY WAIVES ITS RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY PROCEEDING OVER ANY DISPUTE ARISING UNDER THIS AGREEMENT.

c.This Agreement, together with the Change In Control Agreement, constitutes the entire agreement among the parties pertaining to the subject matter hereto, and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties, including, without limitation, the Former Agreement and the Offer Letter.

3

IN WITNESS WHEREOF, the Officer has hereunto set his hand and the Company has caused this Agreement to be executed in its name on its behalf, all as of the Effective Date.

/s/ THE PEP BOYS – MANNY, MOE & JACK

/s/ HAL SMITH

4

Schedule 2(b)

AutoZone, Advance, CSK, NAPA, Monro, Midas, Meineke, Jiffy Lube, Sears Automotive, Firestone, Goodyear, NTB, America’s Discount Tire, TBC Corp (Big O Tire), Just Tires, Les Schwab, Tire Kingdom, Tire Plus, and O’Reilly

5