SUPPLEMENTAL GUARANTOR INFORMATION

6 Months Ended

Jul. 30, 2011

SUPPLEMENTAL GUARANTOR INFORMATION

SUPPLEMENTAL GUARANTOR INFORMATION

NOTE 17—SUPPLEMENTAL GUARANTOR INFORMATION

The Company’s Notes are fully and unconditionally and joint and severally guaranteed by certain of the Company’s direct and indirectly wholly-owned subsidiaries—namely, The Pep Boys Manny Moe & Jack of California, The Pep Boys—Manny Moe & Jack of Delaware, Inc. (the “Pep Boys of Delaware”); Pep Boys—Manny Moe & Jack of Puerto Rico, Inc.; Tire Stores Group Holding Corporation (on and after May 5, 2011); Big 10 Tire Stores, LLC (on and after May 5, 2011) and PBY Corporation (at and prior to January 29, 2011), (collectively, the “Subsidiary Guarantors”). The Notes are not guaranteed by the Company’s wholly owned subsidiary, Colchester Insurance Company.

The following consolidating information presents, in separate columns, the condensed consolidating balance sheets as of July 30, 2011 and January 29, 2011 and the related condensed consolidating statements of operations for the twenty-six weeks ended July 30, 2011 and July 31, 2010 and condensed consolidating statements of cash flows for the thirteen weeks ended July 30, 2011 and July 31, 2010 for (i) the Company (“Pep Boys”) on a parent only basis, with its investment in subsidiaries recorded under the equity method, (ii) the Subsidiary Guarantors on a combined basis, (iii) the subsidiary of the Company that does not guarantee the Notes, and (iv) the Company on a consolidated basis. The Company made an immaterial adjustment to the January 29, 2011 amounts reported for cash, intercompany receivables and intercompany liabilities to account for certain intercompany borrowing activity between Pep Boys and a subsidiary guarantor.

On January 29, 2011, The Pep Boys — Manny, Moe & Jack of Pennsylvania made a capital contribution of $264.0 million to Pep Boys of Delaware consisting of intercompany receivables due from the latter. This contribution resulted in an increase in the Pep Boys’ investment in subsidiaries and the Subsidiary Guarantors’ stockholders’ equity. On January 30, 2011, the Company merged PBY Corporation into Pep Boys of Delaware and accordingly, The Pep Boys Manny Moe & Jack of California became the wholly owned subsidiary of  Pep Boys of Delaware. This merger did not affect the presentation of the following condensed consolidating information.

On May 5, 2011, The Pep Boys — Manny, Moe & Jack acquired Tire Store Group Holdings Corporation and its subsidiary Big 10 Tire Stores, LLC. As a result of this acquisition, The Pep Boys—Manny, Moe & Jack of Pennsylvania increased its investment in subsidiaries by $9.4 million (see Note 3 - Acquisitions).

CONDENSED CONSOLIDATING BALANCE SHEET

(dollars in thousands)

(unaudited)

As of July 30, 2011	Pep Boys		Subsidiary Guarantors		Subsidiary Non- Guarantors		Consolidation/ Elimination			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	20,187	$	31,475	$	10,315	$	—		$	61,977
Accounts receivable, net	8,409		13,322		—		—			21,731
Merchandise inventories	194,605		389,692		—		—			584,297
Prepaid expenses	7,723		10,892		6,836		(5,757		)	19,694
Other current assets	872		879		54,049		(4,909		)	50,891
Total current assets	231,796		446,260		71,200		(10,666		)	738,590
Property and equipment—net	237,515		444,484		30,521		(18,778		)	693,742
Investment in subsidiaries	2,148,583		—		—		(2,148,583		)	—
Intercompany receivables	—		1,373,918		67,464		(1,441,382		)	—
Goodwill	2,549		46,035		—		—			48,584
Deferred income taxes	16,457		51,531		—		—			67,988
Other long-term assets	29,708		1,992		—		—			31,700
Total assets	$	2,666,608	$	2,364,220	$	169,185	$	(3,619,409	)	$	1,580,604
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	223,457	$	7,427	$	—	$	—		$	230,884
Trade payable program liability	61,440		—		—		—			61,440
Accrued expenses	18,860		55,362		138,162		(5,757		)	206,627
Deferred income taxes	25,984		37,750		—		(4,909		)	58,825
Current maturities of long-term debt	1,079		—		—		—			1,079
Total current liabilities	330,820		100,539		138,162		(10,666		)	558,855
Long-term debt less current maturities	294,583		—		—		—			294,583
Other long-term liabilities	31,496		44,192		—		—			75,688
Deferred gain from asset sales	63,422		101,929		—		(18,778		)	146,573
Intercompany liabilities	1,441,382		—		—		(1,441,382		)	—
Total stockholders’ equity	504,905		2,117,560		31,023		(2,148,583		)	504,905
Total liabilities and stockholders’ equity	$	2,666,608	$	2,364,220	$	169,185	$	(3,619,409	)	$	1,580,604

As of January 29, 2011	Pep Boys		Subsidiary Guarantors		Subsidiary Non- Guarantors		Consolidation/ Elimination			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	37,912	$	42,779	$	9,549	$	—		$	90,240
Accounts receivable, net	8,976		10,564		—		—			19,540
Merchandise inventories	198,062		366,340		—		—			564,402
Prepaid expenses	11,839		17,649		16,202		(17,148		)	28,542
Other current assets	2,260		936		62,655		(5,039		)	60,812
Total current assets	259,049		438,268		88,406		(22,187		)	763,536
Property and equipment—net	236,853		452,230		30,862		(18,964		)	700,981
Investment in subsidiaries	2,093,479		—		—		(2,093,479		)	—
Intercompany receivables	—		1,361,656		79,270		(1,440,926		)	—
Goodwill	2,549		—		—		—			2,549
Deferred income taxes	15,749		50,270		—		—			66,019
Other long-term assets	22,392		1,195		—		—			23,587
Total assets	$	2,630,071	$	2,303,619	$	198,538	$	(3,575,556	)	$	1,556,672
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	210,440	$	—	$	—	$	—		$	210,440
Trade payable program liability	56,287		—		—		—			56,287
Accrued expenses	23,341		62,168		167,667		(17,148		)	236,028
Deferred income taxes	23,024		38,350		—		(5,039		)	56,335
Current maturities of long-term debt	1,079		—		—		—			1,079
Total current liabilities	314,171		100,518		167,667		(22,187		)	560,169
Long-term debt less current maturities	295,122		—		—		—			295,122
Other long-term liabilities	35,870		34,176		—		—			70,046
Deferred gain from asset sales	65,522		106,317		—		(18,964		)	152,875
Intercompany liabilities	1,440,926		—		—		(1,440,926		)	—
Total stockholders’ equity	478,460		2,062,608		30,871		(2,093,479		)	478,460
Total liabilities and stockholders’ equity	$	2,630,071	$	2,303,619	$	198,538	$	(3,575,556	)	$	1,556,672

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

(dollars in thousands)

(unaudited)

				Subsidiary			Subsidiary Non-			Consolidation /
Thirteen Weeks Ended July 30, 2011	Pep Boys			Guarantors			Guarantors			Elimination			Consolidated
Merchandise sales	$	137,881		$	277,386		$	—		$	—		$	415,267
Service revenue	37,113			70,214			—			—			107,327
Other revenue	—			—			5,732			(5,732		)	—
Total revenues	174,994			347,600			5,732			(5,732		)	522,594
Costs of merchandise sales	98,345			189,785			—			(409		)	287,721
Costs of service revenue	32,886			66,815			—			(38		)	99,663
Costs of other revenue	—			—			5,830			(5,830		)	—
Total costs of revenues	131,231			256,600			5,830			(6,277		)	387,384
Gross profit from merchandise sales	39,536			87,601			—			409			127,546
Gross profit from service revenue	4,227			3,399			—			38			7,664
Gross profit from other revenue	—			—			(98		)	98			—
Total gross profit	43,763			91,000			(98		)	545			135,210
Selling, general and administrative expenses	38,562			74,698			80			(72		)	113,268
Net gain from dispositions of assets	—			(3		)	—			—			(3		)
Operating profit	5,201			16,299			(178		)	617			21,939
Non-operating (expense) income	(4,216		)	15,852			618			(11,685		)	569
Interest expense (income)	17,534			499			(521		)	(11,068		)	6,444
(Loss) earnings from continuing operations before income taxes	(16,549		)	31,652			961			—			16,064
Income tax (benefit) expense	(3,100		)	5,114			159			—			2,173
Equity in earnings of subsidiaries	27,365			—			—			(27,365		)	—
Net earnings from continuing operations	13,916			26,538			802			(27,365		)	13,891
Discontinued operations, net of tax	27			25			—			—			52
Net earnings	$	13,943		$	26,563		$	802		$	(27,365	)	$	13,943

				Subsidiary			Subsidiary Non-			Consolidation /
Thirteen Weeks Ended July 31, 2010	Pep Boys			Guarantors			Guarantors			Elimination			Consolidated
Merchandise sales	$	141,019		$	265,160		$	—		$	—		$	406,179
Service revenue	35,729			62,947			—			—			98,676
Other revenue	—			—			5,736			(5,736		)	—
Total revenues	176,748			328,107			5,736			(5,736		)	504,855
Costs of merchandise sales	99,511			183,260			—			(409		)	282,362
Costs of service revenue	31,186			56,844			—			(38		)	87,992
Costs of other revenue	—			—			5,091			(5,091		)	—
Total costs of revenues	130,697			240,104			5,091			(5,538		)	370,354
Gross profit from merchandise sales	41,508			81,900			—			409			123,817
Gross profit from service revenue	4,543			6,103			—			38			10,684
Gross profit from other revenue	—			—			645			(645		)	—
Total gross profit	46,051			88,003			645			(198		)	134,501
Selling, general and administrative expenses	41,258			72,576			89			(815		)	113,108
Net gain from dispositions of assets	2,218			231			—			—			2,449
Operating profit	7,011			15,658			556			617			23,842
Non-operating (expense) income	(4,163		)	20,313			617			(16,146		)	621
Interest expense (income)	16,306			6,393			(527		)	(15,529		)	6,643
(Loss) earnings from continuing operations before income taxes	(13,458		)	29,578			1,700			—			17,820
Income tax (benefit) expense	(5,311		)	11,663			669			—			7,021
Equity in earnings of subsidiaries	18,784			—			—			(18,784		)	—
Net earnings from continuing operations	10,637			17,915			1,031			(18,784		)	10,799
Discontinued operations, net of tax	(39		)	(162		)	—			—			(201		)
Net earnings	$	10,598		$	17,753		$	1,031		$	(18,784	)	$	10,598

				Subsidiary			Subsidiary Non-			Consolidation /
Twenty-six Weeks Ended July 30, 2011	Pep Boys			Guarantors			Guarantors			Elimination			Consolidated
Merchandise sales	$	279,262		$	544,632		$	—		$	—		$	823,894
Service revenue	75,648			136,592			—			—			212,240
Other revenue	—			—			11,466			(11,466		)	—
Total revenues	354,910			681,224			11,466			(11,466		)	1,036,134
Costs of merchandise sales	197,518			376,348			—			(816		)	573,050
Costs of service revenue	65,974			126,854			—			(76		)	192,752
Costs of other revenue	—			—			11,656			(11,656		)	—
Total costs of revenues	263,492			503,202			11,656			(12,548		)	765,802
Gross profit from merchandise sales	81,744			168,284			—			816			250,844
Gross profit from service revenue	9,674			9,738			—			76			19,488
Gross profit from other revenue	—			—			(190		)	190			—
Total gross profit	91,418			178,022			(190		)	1,082			270,332
Selling, general and administrative expenses	76,386			145,767			166			(151		)	222,168
Net gain from dispositions of assets	—			86			—			—			86
Operating profit	15,032			32,341			(356		)	1,233			48,250
Non-operating (expense) income	(8,491		)	31,921			1,234			(23,508		)	1,156
Interest expense (income)	34,859			1,400			(1,043		)	(22,275		)	12,941
(Loss) earnings from continuing operations before income taxes	(28,318		)	62,862			1,921			—			36,465
Income tax (benefit) expense	(7,714		)	17,347			536			—			10,169
Equity in earnings of subsidiaries	46,896			—			—			(46,896		)	—
Net earnings from continuing operations	26,292			45,515			1,385			(46,896		)	26,296
Discontinued operations, net of tax	19			(4		)	—			—			15
Net earnings	$	26,311		$	45,511		$	1,385		$	(46,896	)	$	26,311

				Subsidiary			Subsidiary Non-			Consolidation /
Twenty-six Weeks Ended July 31, 2010	Pep Boys			Guarantors			Guarantors			Elimination			Consolidated
Merchandise sales	$	285,444		$	529,924		$	—		$	—		$	815,368
Service revenue	72,370			127,150			—			—			199,520
Other revenue	—			—			11,472			(11,472		)	—
Total revenues	357,814			657,074			11,472			(11,472		)	1,014,888
Costs of merchandise sales	200,507			366,467			—			(816		)	566,158
Costs of service revenue	62,356			114,354			—			(76		)	176,634
Costs of other revenue	—			—			11,561			(11,561		)	—
Total costs of revenues	262,863			480,821			11,561			(12,453		)	742,792
Gross profit from merchandise sales	84,937			163,457			—			816			249,210
Gross profit from service revenue	10,014			12,796			—			76			22,886
Gross profit from other revenue	—			—			(89		)	89			—
Total gross profit	94,951			176,253			(89		)	981			272,096
Selling, general and administrative expenses	81,311			143,511			170			(252		)	224,740
Net gain from dispositions of assets	2,080			414			—			—			2,494
Operating profit	15,720			33,156			(259		)	1,233			49,850
Non-operating (expense) income	(8,413		)	40,521			1,233			(32,136		)	1,205
Interest expense (income)	32,352			12,851			(1,049		)	(30,903		)	13,251
(Loss) earnings from continuing operations before income taxes	(25,045		)	60,826			2,023			—			37,804
Income tax (benefit) expense	(9,856		)	23,905			796			—			14,845
Equity in earnings of subsidiaries	37,778			—			—			(37,778		)	—
Net earnings from continuing operations	22,589			36,921			1,227			(37,778		)	22,959
Discontinued operations, net of tax	(41		)	(370		)	—			—			(411		)
Net earnings	$	22,548		$	36,551		$	1,227		$	(37,778	)	$	22,548

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(dollars in thousands)

(unaudited)

Twenty-six Weeks Ended July 30, 2011	Pep Boys			Subsidiary Guarantors			Subsidiary Non- Guarantors			Consolidation / Elimination			Consolidated
Net earnings	$	26,311		$	45,511		$	1,385		$	(46,896	)	$	26,311
Adjustments to Reconcile Net Earnings to Net Cash (Used In) Provided By Continuing Operations	(29,167		)	23,091			471			45,663			40,058
Changes in operating assets and liabilities	15,989			(19,417		)	(11,663		)	—			(15,091		)
Net cash provided by (used in) continuing operations	13,133			49,185			(9,807		)	(1,233		)	51,278
Net cash (used in) discontinued operations	19			(63		)	—			—			(44		)
Net Cash Provided by (Used in) Operating Activities	13,152			49,122			(9,807		)	(1,233		)	51,234
Net cash used in continuing operations	(21,257		)	(57,605		)	—			—			(78,862		)
Net cash provided by discontinued operations	—			—			—			—			—
Net Cash Used in Investing Activities	(21,257		)	(57,605		)	—			—			(78,862		)
Net Cash Provided by (Used in) Financing Activities	(9,620		)	(2,821		)	10,573			1,233			(635		)
Net Increase (Decrease) in Cash	(17,725		)	(11,304		)	766			—			(28,263		)
Cash and Cash Equivalents at Beginning of Period	37,912			42,779			9,549			—			90,240
Cash and cash equivalents at end of period	$	20,187		$	31,475		$	10,315		$	—		$	61,977

Twenty-six Weeks Ended July 31, 2010	Pep Boys			Subsidiary Guarantors			Subsidiary Non- Guarantors			Consolidation / Elimination			Consolidated
Cash flows from operating activities:
Net earnings	$	22,548		$	36,551		$	1,227		$	(37,778	)	$	22,548
Adjustments to reconcile net earnings to net cash (used in) provided by continuing operations	(17,866		)	18,057			285			36,545			37,021
Changes in operating assets and liabilities	12,796			(3,933		)	(9,308		)	—			(445		)
Net cash provided by (used in) continuing operations	17,478			50,675			(7,796		)	(1,233		)	59,124
Net cash used in discontinued operations	(43		)	(1,206		)	—			—			(1,249		)
Net cash provided by (used in) operating activities	17,435			49,469			(7,796		)	(1,233		)	57,875
Net cash used in continuing operations	(13,509		)	(9,842		)	—			—			(23,351		)
Net cash provided by discontinued operations	—			569			—			—			569
Net cash used in investing activities	(13,509		)	(9,273		)	—			—			(22,782		)
Net cash provided by (used in) financing activities	41,895			(37,564		)	12,380			1,233			17,944
Net increase in cash and cash equivalents	45,821			2,632			4,584			—			53,037
Cash and cash equivalents at beginning of period	25,844			10,279			3,203			—			39,326
Cash and cash equivalents at end of period	$	71,665		$	12,911		$	7,787		$	—		$	92,363