Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 11, 2022, Advance Auto Parts, Inc. (the "Company") announced that its
Board of Directors ("Board") has appointed William Pellicciotti to become the
Company's Senior Vice President, Controller and Chief Accounting Officer
(Principal Accounting Officer), effective January 24, 2022.
Prior to joining the Company, Mr. Pellicciotti, age 42, served as the Vice
President, Controller - North America for The Kraft Heinz Company, a
multinational food and beverage company, since October 2020, and as Finance
Director, SEC Reporting, Accounting Policy & SOX Compliance at The
Colgate-Palmolive Company ("Colgate"), a multinational consumer products
company, from October 2019 to October 2020. Since 2009, Mr. Pellicciotti has
served in multiple leadership roles in finance at Colgate, including as the
Finance Director for the Asia-Pacific Division (based in Hong Kong) from January
2018 to September 2019 and as the Center Lead and Finance Director for Colgate
Business Services (based in Poland) from March 2013 to December 2017. Mr.
Pellicciotti began his career as an accountant at CliftonLarsonAllen, LLP, a
professional services firm, and as Manager at PricewaterhouseCoopers LLP, a
leading accounting firm. He holds a B.A. in Accounting and is a Certified Public
Accountant.
Employment Agreement
In connection with his appointment, Mr. Pellicciotti and the Company have agreed
to a compensation arrangement, which has been approved by the Compensation
Committee of the Board ("Committee"). Pursuant to the compensation arrangement,
Mr. Pellicciotti's annual base salary is $400,000, and he is eligible to
participate in the Company's annual incentive bonus plan with a bonus target of
65 percent of base salary ("Target Bonus Amount") and a maximum bonus
opportunity of 200 percent of the Target Bonus Amount, based on the Company's
performance as measured against the same bonus criteria applied to other senior
executives of the Company. He will also receive a one-time cash signing bonus in
the amount of $324,500 that he will be required to repay if he voluntarily
resigns his employment with the Company prior to completion of two years of
service.
Mr. Pellicciotti is eligible to receive annual equity grants under the Company's
2014 Long-Term Incentive Plan, as amended (the "2014 LTIP") consistent with the
Company's compensation program for other executives of the Company. The
grant-date fair value of Mr. Pellicciotti's annual equity grant for the
2022-2024 performance cycle is expected to be approximately $350,000, with a
grant-type mix determined by the Committee and will be granted at the same time
that annual grants for the same cycle are made to other newly hired executives.
In addition, Mr. Pellicciotti and the Company have entered into an employment
agreement effective January 24, 2022, which provides for an initial one year
employment term. After the initial one-year term, Mr. Pellicciotti's agreement
is extended each day for an additional day until the Company provides at least
90 days' notice of its intention not to extend the agreement.
Upon termination of employment by the Company without Cause (not in connection
with a change in control) or upon termination of employment by the Company
without Cause within 12 months after a change in control, Mr. Pellicciotti would
be entitled to:
•Severance equal to one times the sum of (a) his base salary and (b) an amount
equal to the pro rata portion of any annual bonus that would have been payable
to him, provided that the criteria for such bonus other than his continued
employment have been satisfied;
•Continued medical, dental and vision benefits for 52 weeks post-termination at
the same cost as active employees;
•Outplacement assistance, at a cost to the Company not to exceed $12,000, for a
period of up to 12 months; and
•Equity awards treated as set forth in the 2014 LTIP and the applicable award
agreements.
Any severance benefits paid would be subject to Mr. Pellicciotti's execution
(without revocation) of a general release of claims against the Company.
Pursuant to the terms of his employment agreement, Mr. Pellicciotti is subject
to certain restrictive covenants, including the following, among others:
non-disclosure of confidential information; non-disparagement; non-solicitation
of customers, suppliers, employees, agents or independent contractors, which
runs for one year following his termination of employment; and non-competition,
which runs for one year following his termination of employment.
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The foregoing summary description of the material terms of Mr. Pellicciotti's
employment agreement does not purport to be complete and is qualified in its
entirety by the actual terms of the employment agreement.
Item 7.01 Regulation FD Disclosure
A press release announcing the appointment of Mr. Pellicciotti was issued by the
Company on January 11, 2022, a copy of which is attached hereto as Exhibit 99.1
and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number
Press release, dated January 11, 2022, issued by Advance Auto Parts,
99.1 Inc.
101.1 Pursuant to Rule 406 of Regulation S-T, the cover page to this Current
Report on Form 8-K is formatted in Inline XBRL.
104.1 Cover Page Interactive Data File (embedded within the Inline XBRL document
included in Exhibit 101.1).
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