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Compensation Committee Charter

 

Pep Boys Auto

The Board of Directors (the "Board") of The Pep Boys - Manny, Moe & Jack (the "Company") has adopted this Charter for its Compensation Committee (the "Committee") effective as of June 11, 2014.

  1. Composition

    The Committee shall be comprised of at least three directors designated by the Board, all of whom, in the judgment of the Board, shall comply with the independence requirements of the New York Stock Exchange, Inc. (“NYSE”). The Committee Chair and members shall be Directors appointed by the Board upon the recommendation of the Nominating & Governance Committee. The Committee members shall serve at the pleasure of the Board, which shall have the right, at any time with our without cause, to fill vacancies on the Committee, remove Committee members or reconstitute the Committee in its entirety.

  2. Authority

    The Committee is authorized to carry out the responsibilities set forth in this Charter and any other assignments requested by the Board. The Committee shall have full access to the Company's books, records, facilities and personnel (including, without limitation, direct access to the Company's internal auditor) to carry out its responsibilities and is authorized to retain and pay, with Company funds, persons or entities having special competence, such as legal counsel, accountants, and compensation consultants, to assist the Committee in fulfilling its responsibilities. In selecting independent advisors, the Committee will review and consider various measures of “independence,” including those set forth in the Dodd-Frank Act of 2010 and rules promulgated by the Securities and Exchange Commission (the “SEC”) and the NYSE. In addition, the Committee shall have access to the Company's outside counsel for advice and information.

  3. Purpose

    The Committee shall assist the Board in fulfilling its fiduciary responsibilities with respect to the compensation of the Officer Group. The "Officer Group" shall mean (i) those Company employees meeting the definition of an "officer" as defined in Rule 16a-1(f) promulgated under the Securities Exchange Act of 1934 ("Section 16(b) Officers") and (ii) any other Company employees determined to be appropriate for inclusion in the Officer Group by the Committee in consultation with the CEO. In addition, the Committee shall (i) review and discuss with management the Company’s Compensation Discussion & Analysis (“CD&A”), and based on that review and discussion, recommend to the Board that the CD&A be included in the Company’s annual proxy statement and (ii) produce a Compensation Committee Report and any other required disclosure, in accordance with the proxy solicitation rules promulgated by the SEC, for inclusion in the Company's annual proxy statement. The Committee will represent the Board where appropriate and assist in human resource issues that directly impact the business.

  4. Meetings

    • 4.1 Number. The Committee is to meet at least four times per year, and as many other times as the Board, the Committee or the Committee Chairman deems necessary. The Committee may meet or otherwise take action in the same manner or manners as may the Board.
    • 4.2 Attendance. The Committee or the Chairman of the Committee may request that member(s) of management and representatives of the independent auditors be present at meetings of the Committee as well as outside experts or counsel, if appropriate.
    • 4.3 Quorum. A quorum for any Committee meeting shall be a majority of the Committee members.
    • 4.4 Agenda. The agenda for each meeting will be set by the Committee Chair. The chair may confer with the appropriate members of management or other members of the Committee.
    • 4.5 Minutes. Minutes of each Committee Meeting are to be prepared and sent to Committee members.
  5. Authority and Responsibilities

    In accordance with its stated purpose of assisting the Board in fulfilling its fiduciary responsibilities with respect to the compensation of the Company's Officer Group, the Committee shall have the following authority and responsibilities:

    • 5.1 Establishing and periodically reviewing and/or modifying a peer group of companies to be used as a basis of comparison for the evaluations, recommendations and approvals discussed below.
    • 5.2 Making recommendations to the Board regarding performance goals and objectives for the Officer Group for the purposes of establishing annual and long term compensation levels, including base salaries, bonus targets under the Annual Incentive Bonus Plan and target equity grants under the Stock Incentive Plan.
    • 5.3 Evaluating the performance of the CEO and the other members of the Officer Group as measured against the performance goals and objectives approved by the full Board and any other criteria deemed appropriate by the Committee.
    • 5.4 Making recommendations to the Board (or the independent directors of the Board with respect to the CEO) regarding the appropriate base salary level of the CEO and the other members of the Officer Group based upon an evaluation of the respective individual's performance and the Company's performance.
    • 5.5 Making recommendations to the Board (or the independent Directors of the Board with respect to the CEO) regarding the annual incentive bonus payouts to be made to the CEO and the other members of the Officer Group based upon the achievement of the pre-established bonus targets under the Annual Incentive Bonus Plan and any other criteria deemed appropriate by the Committee.
    • 5.6 Making recommendations to the Board (or the independent Directors of the Board with respect to the CEO) regarding the annual award grants under the Stock Incentive Plan to be made to the CEO and the other members of the Officer Group based upon the pre-established target grant model and any other criteria deemed appropriate by the Committee.
    • 5.7 Approving award grants, in the aggregate, to employees of the Company (other than members of the Officer Group) in accordance with the Stock Incentive Plan, such award grants to be disbursed according to the discretion of the CEO and SVP - Human Resources.
    • 5.8 Making recommendations to the Board with respect to changes to existing or adopting new, cash, equity or other compensation plans.
    • 5.9 Making recommendations to the Board regarding the components of offers of employment to new Section 16(b) Officers and approving the components of the offer of employment to new members of the Officer Group, other than the Section 16(b) Officers.
    • 5.10 Making recommendations to the Board regarding any warranted changes (e.g., market adjustments, retention bonuses) to the compensation level of a Section 16(b) Officer. Approving any warranted changes to the compensation level of a member of the Officer Group, other than a Section 16(b) Officer.
    • 5.11 Approving any contractual commitment to be entered into with a member of the Officer Group, including, without limitation, employment agreements, retirement arrangements and/or change-in-control agreements.
    • 5.12 Making recommendations to the Board for contingency plans to replace key officers in the case of an emergency.
    • 5.13 Assisting in the development of a succession plan for key executives, which would include development and recruiting plans as appropriate.
    • 5.14 Periodically reviewing and making recommendations to the Board regarding outside director compensation levels and components.
    • 5.15 Informing the Board on all broad human resources concerns.
    • 5.16 Preparing an annual performance self-evaluation of the Committee and delivering an overview thereof to the Board.

The Board of Directors (the "Board") of The Pep Boys - Manny, Moe & Jack (the "Company") has adopted this Charter for its Compensation Committee (the "Committee") effective as of June 11, 2014.