Pep Boys 2010 Annual Report Download - page 23

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17
their presentation to the Compensation Committee. Our President & Chief Executive Officer was principally
responsible for recommendations made to the Compensation Committee with respect to the compensation of our
named executive officers (other than himself) and other officers. The Compensation Committee considered, but was
not bound to and did not always accept, management’s recommendations with respect to executive compensation.
The President & Chief Executive Officer, Senior Vice President – Human Resources and Senior Vice President –
General Counsel & Secretary regularly attended committee meetings, excluding portions of meetings where their
own compensation was discussed.
In connection with establishing compensation levels for fiscal 2010, Pay Governance advised the Compensation
Committee on the then-current competitiveness of program design and award values. Representatives of Pay
Governance regularly attended committee meetings and also communicated with the chair of the Compensation
Committee outside of meetings. Pay Governance worked with management (including the President & Chief
Executive Officer, Senior Vice President - Human Resources and Senior Vice President – General Counsel &
Secretary) from time-to-time for purposes of gathering information and reviewing and providing input to
management on recommendations, proposals and materials that management presented to the Compensation
Committee. Pay Governance was engaged directly by the Compensation Committee and did not provide any
additional services to the Company in fiscal 2010.
The Compensation Committee and the Board of Directors consider our overall compensation levels for the
named executive officers to be reasonable and appropriate and believe that our executive compensation program
achieves the objectives outlined at the beginning of this summary.
Components of Compensation.
The compensation provided to the executives listed in the Summary Compensation Table, whom we refer to as
our named executive officers, consists of base salaries, short-term cash incentives, long-term equity incentives,
retirement plan contributions and health and welfare benefits.
Base Salary. The Compensation Committee reviews base salaries annually to reflect the experience, performance
and scope of responsibility of the named executive officers and to ensure that the salaries are appropriate to retain
high quality individuals. The full Board measures the President & Chief Executive Officer’s individual performance
during the applicable fiscal year in the areas of strategic planning and execution, leadership, financial results,
management development and succession planning, key stakeholder focus, ethics and Board relations, based upon
individual assessments completed by each Director. The Compensation Committee reviews the President & Chief
Executive Officer’s assessments of each other named executive officer’s individual performance during the
applicable fiscal year in the areas of core and positional competencies. Salary adjustments are then made taking into
account the performance assessment, the relative position of the named executive officer’s current salary within the
market range for his position and the budgeted percentage increase for all officers as a group. For fiscal 2010, the
Compensation Committee determined that each of the named executive officers’ base salary was at the appropriate
level without need for adjustment, except for Mr. Cirelli who received a 1% increase.