Pep Boys 2012 Annual Report Download - page 22

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18
In connection with establishing compensation levels for fiscal 2012, Pay Governance advised the Compensation
Committee on the then-current competitiveness of our program design and total compensation levels.
Representatives of Pay Governance regularly attended committee meetings and also communicatedwith 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 2012.
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 each named executive officers and to ensure that executive salaries are appropriate to
retain highly qualified 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 the other named executive officers’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 2012, the
Compensation Committee recommended, and the full Board approved, adjustments to base salaries of Messrs. Odell
and Webb of 1.2% and 2.0%, respectively, to reflect their respective performancesin fiscal 2011. The starting
salaries for Messrs. Stern and Carey were established, in consultation with the Pay Governance, at levels believed
necessary to induce such executives to join the Company with reference to their experience and positional
responsibilities and peer group data for comparable executives.