Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On February 7, 2017, the Company announced that its Board of Directors (the “Board”) promoted Gregory D. Johnson, the Company’s Executive Vice President of Supply Chain, and Jeff M. Shaw, the Company’s Executive Vice President of Store Operations and Sales, to Co-Presidents, effective immediately.
Mr. Johnson will be responsible for Merchandise, Logistics, Purchasing, Inventory Management, Pricing, Advertising, Information Technology, Legal, Risk Management, Loss Prevention, Human Resources and Finance. Mr. Shaw’s areas of responsibility will include Store Operations, Sales, Distribution Operations, Real Estate, Jobber Sales and Acquisitions. Mr. Johnson and Mr. Shaw will continue to report to Greg Henslee, who will remain the Company’s Chief Executive Officer.
Gregory D. Johnson, age 51, worked for Mid-State Automotive Distributors, Inc. (“Midstate”) for 19 years prior to O’Reilly acquisition of Midstate in 2001, and he has been an O’Reilly Team Member since that time. Prior to his new role as Co-President, Mr. Johnson’s primary areas of responsibility were Distribution Operations, Logistics, Purchasing, Inventory Management, Merchandise, Pricing, and Advertising. Mr. Johnson’s career began as a part-time Distribution Center Team Member and progressed through the roles of Retail Systems Manager, Warehouse Management Systems Development Manager, Director of Distribution, Vice President of Distribution Operations, and Senior Vice President of Distribution Operations. Mr. Johnson held the position of Executive Vice President of Supply Chain since 2014.
Jeff M. Shaw, age 54, has been an O’Reilly Team Member for 28 years. Prior to his new role as Co-President, Mr. Shaw’s primary areas of responsibility were Store Operations, Sales, Real Estate, Professional Sales, Acquisitions, and Human Resources. Mr. Shaw’s career began as a Parts Specialist and progressed through the roles of Store Manager, District Manager, Regional Manager, Vice President of the Southern Division, Vice President of Sales and Operations, and Senior Vice President of Sales and Operations. Mr. Shaw held the position of Executive Vice President of Store Operations and Sales since 2013.
In connection with the promotions, the Compensation Committee of the Board recommended, and the Board approved, an annual base salary of $550,000, for both Mr. Johnson and Mr. Shaw, determined that each will be eligible to participate in the Company’s annual performance incentive compensation plan with a bonus target of 80% of his base salary, based on the Company’s performance as measured against the same criteria applied to the Company’s other executive officers, and determined that each will receive a stock option award with a fair value of $550,000, granted at the same time that annual grants for the Company’s other executive officers are awarded.