Pep Boys 2011 Annual Report Download - page 23

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17
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 officers current salary within the
market range for his position and the budgeted percentage increase for all officers as a group. For fiscal 2011, the
Compensation Committee recommended, and the full Board approved, adjustments to each of the named executive
officers’ base salaries, to reflect each executive’s performance in fiscal 2010 and to more closely align each
executive’s salary with the market range for such executive’s position. Messrs. Odell, Arthur, Shull, Webb and
Cirelli received increases of 1.5%, 3.3%, 6.7%, 10.3% and 1.3%, respectively.In addition, each named executive
officer received an $8,000 increase to their base salary to reflect the after-tax value of the executive supplemental
medical plan that was eliminated for fiscal 2011.
Short-Term Incentives. The named executive officers participate in our Annual Incentive Bonus Plan, which is a
short-term incentive plan designed to reward the achievement of pre-established goals. In order to directly align our
named executive officers’ short-term incentive compensation with that of our overall performance, these pre-
established goals consist entirely of corporate (as opposed to individual) objectives. For fiscal 2011, the named
executive officers’ annual short-term incentive opportunity was as follows:
% of Base Salary
Title Threshold Target Cash Cap(a)Maximum
President & CEO 50 100 150 200
Executive Vice President 37.5 75 112.5 150
Senior Vice Presidents 22.5 45 67.5 90
(a) Amounts achieved above the “cash cap” percentage up to the “maximum” percentage are earned and paid out over
the subsequent three years, assuming the executive remains employed by the Company.