CarParts.com, Inc 8-K, filed Dec 5, 2022
CarParts.com, Inc. (PRTS)
About this 8-K
CarParts.com, Inc filed this 8-K on December 5, 2022.
Items reported
- Item 5.02: Director or officer change, or executive pay
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Michael Huffaker as Chief Operating Officer
On November 14, 2022, the Board of Directors (the “Board”) of CarParts.com, Inc. (the “Company”) appointed Michael Huffaker as Chief Operating Officer of the Company, effective December 5, 2022 (the “Effective Date”).
Mr. Huffaker, 43, previously served as Vice President, Category Leader, for Amazon Fresh Grocery from June 2014 to December 2022, where he eventually oversaw a portfolio of 57 purpose-built grocery fulfillment centers, five grocery distribution centers, forty grocery stores and a team of approximately six hundred staff. Prior to that, Mr. Huffaker was Senior Manager for Amazon Fresh from August 2011 to May 2014, and as Manager, Vendor Management, Wireless from March 2008 to July 2011. We believe Mr. Huffaker’s valuable business and leadership experience, particularly in the e-commerce and supply chain development, combined with his experience in building and overseeing successful teams in the areas of product and business management, qualifies Mr. Huffaker to serve as an officer of the Company.
In connection with his appointment, the Company and Huffaker entered into an employment agreement (the “COO Employment Agreement”), pursuant to which Mr. Huffaker will receive an annual base salary of $425,000. Beginning in 2023, Mr. Huffaker will also be eligible to receive an annual target incentive bonus of up to 50% of his annual salary, based on annual goals and other performance criteria established by the Compensation Committee of the Board. The target for such annual incentive bonus for the first calendar year of his service as Chief Operating Officer will be $212,500. He will also be eligible to receive an additional annual target incentive bonus in the form of shares of common stock or restricted stock unit awards as determined by the Compensation Committee. Mr. Huffaker will also be eligible to participate in the Company’s other employee benefits and incentive compensation programs.
The Company has also agreed to grant to Mr. Huffaker upon commencement of his service as Chief Operating Officer 110,000 time-vesting restricted stock units on the Company’s related standard form grant agreement, vesting in three equal installments on the first, second, and third anniversaries of the commencement of Mr. Huffaker’s service as Chief Operating Officer. Beginning in January 2023, the Company has also agreed to grant to Mr. Huffaker (i) 100,000 performance restricted stock units on the Company’s related standard form of grant agreement, vesting in accordance with the total shareholder return performance requirements therein, and (ii) 40,000 time-vesting restricted stock units on the Company’s related standard form of grant agreement, vesting in three equal installments on the first, second, and third anniversaries of the grant date.
While Mr. Huffaker will be employed on an at-will basis, the COO Employment Agreement provides that in the event of his termination for cause, Mr. Huffaker will be entitled to receive (i) any unpaid annual salary earned through the date of his termination, (ii) any accrued but unused vacation, (iii) any accrued reimbursable expenses, and (iv) any other payments required by law (collectively, the “Required Payments”). If Mr. Huffaker’s employment is terminated due to his death or disability, he will be eligible to receive the Required Payments, plus (i) any unpaid annual target bonus under for the year immediately prior to the year of such termination, (ii) continuation of his annual salary following such termination for a period of one year, (iii) a pro-rated share of his annual target bonus under for the year of such termination, and (iv) in the case of termination due to disability, reimbursement of his COBRA payments for his health insurance benefits for a period of one year. If Mr. Huffaker’s employment is terminated for any other reason or if he resigns for good reason, he will be eligible to receive the Required Payments, plus (i) any unpaid annual target bonus with respect to the prior year and a prorated share of his annual target bonus for the year in which such termination or resignation takes place, (ii) continuation of his annual salary for a period of twelve (12) months from his date of termination, and (iii) reimbursement of his COBRA payments for a period of twelve (12) months.
Mr. Huffaker has no family relationship (within the meaning of Item 401(d) of Regulation S-K) with any director, executive officer, or person nominated or chosen by the Company to become a director or executive officer. There has been no transaction since the beginning of the Company’s last fiscal year, and there is no currently proposed transaction, in excess of $120,000 in which the Company is or was a participant and in which Mr. Huffaker or any of his immediate family members (within the meaning of Item 404 of Regulation S-K) had or will have a direct or indirect material interest.
The foregoing description of the COO Employment Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the COO Employment Agreement, a copy of which is filed as Exhibit 99.1 hereto and is incorporated by reference herein.
Item 7.01. Regulation FD Disclosure.
On December 5, 2022, the Company issued a press release announcing Mr. Huffaker’s appointment as the Company’s Chief Operating Officer. A copy of the press release is attached hereto as Exhibit 99.2.
The information in this Item 7.01 and Exhibit 99.12attached hereto is furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such document or filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
| Description |
99.1 | Employment Agreement, dated December 5, 2022, between CarParts.com, Inc. and Michael Huffaker | |
99.2 | | |
104 | | Cover Page Interactive Data File – the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | |
Dated: December 5, 2022 | CARPARTS.COM, INC. | |
| | |
| | |
| By: | /s/ Ryan Lockwood |
| Name: | Ryan Lockwood |
| Title: | Chief Financial Officer |
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the “Agreement”) is effective December 5, 2022 (the “Effective Date”) by and between CarParts.com, Inc., a Delaware corporation (the “Company”), and Michael Huffaker, an individual (the “Executive”).
WHEREAS, the parties hereto desire to enter into a written agreement to document the terms of Executive’s employment with the Company.
Applicable Withholdings. The Company shall deduct and withhold from the compensation payable to Executive hereunder any and all applicable federal, state and local income and employment withholding taxes and any other amounts required to be deducted or withheld by the Company under applicable statutes, regulations, ordinances or orders governing or requiring the withholding or deduction of amounts otherwise payable as compensation or wages to employees.
awards (other than the RSUs) in the event of a Change in Control Termination and the period for which Executive’s stock options remain exercisable following Executive’s termination or resignation for any reason and shall supersede any provisions to the contrary in any other agreement.
the Company has provided 30 days written notice to Executive and a reasonable opportunity to cure; (iii) conviction of, or plea of nolo contendre to, any felony or misdemeanor involving dishonesty or fraud; (iv) the violation of any of the Company’s policies, including without limitation, the Company’s policies on equal employment opportunity and the prohibition against unlawful harassment; (v) the material breach of any provision of this Agreement after 30 days written notice to Executive of such breach and a reasonable opportunity to cure such breach; or (vi) any other misconduct that has a material adverse effect on the business or reputation of the Company.
in a lump sum within the “short-term deferral” period following the time the Executive obtains a vested right to such payments. For the purposes of this Agreement, “Good Reason” shall mean Executive’s voluntary resignation for any of the following events that results in a material negative change to the Executive; (i) a reduction without Executive’s prior written consent in either his level of Annual Salary or his target annual bonus as a percentage of Annual Salary, except for across-the-board salary reductions based on the Company’s financial performance similarly affecting all or substantially all senior management employees of the Company; (ii) a material reduction in the scope of Executive’s authorities, duties and responsibilities or a reduction in the authority, duties or responsibilities of the supervisor to whom the Executive is required to report, (iii) a relocation of Executive more than thirty (30) miles from the Company’s current corporate headquarters as of the date hereof, (iv) a material breach of any provision of this Agreement by the Company or (v) the failure of the Company to have a successor entity specifically assume this Agreement. Notwithstanding the foregoing, a suspension of Executive’s responsibilities, authority and/or duties for the Company during any portion of a bona fide internal investigation or an investigation by regulatory or law enforcement authorities shall not be a Good Reason for resignation. Following a Change in Control (as defined the Plan), Good Reason shall include (x) a material negative change in authority, duties or responsibilities resulting from the Executive no longer being an executive officer of a publicly-traded company and (y) the Company’s chief executive officer (immediately prior the Change in Control) no longer being the chief executive officer of the successor publicly-traded company. Notwithstanding the foregoing, the Executive shall be entitled to benefits described in this Section 7C and in Section 4B due to a resignation resulting from (x) or (y) of the preceding sentence only if such resignation occurs more than six months after the Change in Control. Notwithstanding the foregoing, “Good Reason” shall only be found to exist if prior to Executive’s resignation for Good Reason, the Executive has provided, not more than 90 days following the initial occurrence thereof, written notice to the Company of such Good Reason event indicating and describing the event resulting in such Good Reason, and the Company does not cure such event within 90 days following the receipt of such notice from Executive.
any company or other enterprise where Executive does not provide any management, consulting or other services to such company or enterprise.
To the Company:CarParts.com, Inc.
2050 W. 190th St, Suite 400,
Torrance, CA 90504
Attn: Chief Executive Officer
To Executive: | At Executive’s last residence as provided by Executive to the Company for payroll records. |
Any party may change such party’s address for the purpose of receiving notices, demands and other communications by providing written notice to the other party in the manner described in this Section 11.
unenforceable in any jurisdiction by reason of the scope, extent or duration of its coverage, then such provision shall be deemed amended to the extent necessary to conform to applicable law so as to be valid and enforceable or, if such provision cannot be so amended without materially altering the intention of the parties, then such provision will be stricken and the remainder of this Agreement shall continue in full force and effect.
It is intended that this Agreement shall comply with the requirements of Section 409A, and any ambiguity contained herein shall be interpreted in such manner so as to avoid adverse personal tax consequences under Section 409A. Notwithstanding the foregoing, the Company shall in no event be obligated to indemnify the Executive for any taxes or interest that may be assessed by the IRS pursuant to Section 409A of the Code to payments made pursuant to this Agreement. To the extent that any severance benefit payments are delayed as required by this Agreement due to the application of Section 409A, all suspended payments shall earn and accrue interest at the prevailing “Prime Rate” of interest as published by The Wall Street Journal at the time the payment is made, and any suspended payment when so made, shall be made as a lump sum payment, including accrued interest.
Notwithstanding any provision of Section 18(A) to the contrary, if the Reduction Method or the Pro Rata Reduction Method would result in any portion of the Payment being subject to taxes pursuant to Section 409A of the Code that would not otherwise be subject to taxes pursuant to Section 409A of the Code, then the Reduction Method and/or the Pro Rata Reduction Method, as the case may be, shall be modified so as to avoid the imposition of taxes pursuant to Section 409A of the Code as follows: (A) as a first priority, the modification shall preserve to the greatest extent possible, the greatest economic benefit for Executive as determined on an after-tax basis; (B) as a second priority, Payments that are contingent on future events (e.g., being terminated without Cause), shall be reduced (or eliminated) before Payments that are not contingent on future events; and (C) as a third priority, Payments that are “deferred compensation” within the meaning of Section 409A of the Code shall be reduced (or eliminated) before Payments that are not deferred compensation within the meaning of Section 409A of the Code.
If Executive receives a Payment for which the Reduced Amount was determined pursuant to clause (x) of Section 18(A) and the Internal Revenue Service determines thereafter that some portion of the Payment is subject to the Excise Tax, Executive shall promptly return to the Company a sufficient amount of the Payment (after reduction pursuant to clause (x) of Section 18(A)) so that no portion of the remaining Payment is subject to the Excise Tax. For the avoidance of doubt, if the Reduced Amount was determined pursuant to clause (y) of Section 18(A), Executive shall have no obligation to return any portion of the Payment pursuant to the preceding sentence.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.
CARPARTS.COM, INC.
By:
Name:
Title:
Date:
EXECUTIVE
/s/
[NAME]
Date:
Former Amazon Executive Joins CarParts.com as Chief Operating Officer
Omnichannel leader, Michael Huffaker, brings extensive retail and operational experience and profitable business acumen to growing executive team
TORRANCE, Calif., December 5, 2022 -- CarParts.com, (NASDAQ: PRTS) a leading e-commerce provider of automotive parts and accessories, and a one-stop shop for vehicle repair and maintenance needs, announces the hiring of tenured industry leader Michael Huffaker as Chief Operating Officer effective today.
Huffaker brings with him unparalleled e-commerce and brick-and-mortar expertise, having most recently served as Vice President, Category Leader, for Amazon Fresh Grocery. He has a history of step-change performance improvement in the businesses he has managed, including known, best-in-class retailers. Huffaker’s interest in the B2B sector also allows for an opportunity in a currently fragmented space, as he sees the potential to double down on the level of service that can be offered. Laser focused on building and scaling supply chains, product and business management, and building large, diverse teams, Huffaker’s approach aligns with the long-term strategy and vision of CarParts.com.
"As we look to the future of CarParts.com and what is needed to take our business to the next level, Michael was the obvious choice for COO,” said David Meniane, CEO. “It is clear he is a customer-centric executive with the financial discipline and operational excellence required to not only succeed but thrive within our organization. We believe he will be a great cultural fit, his skills and mindset mirror those of the company, and together we can accomplish great things.”
As COO, Huffaker is responsible for ensuring customers receive a world-class experience, from the moment they place an order to the time it arrives on their doorstep. “I’ve been following the trajectory of CarParts.com for some time now, and it’s impressive to see their growth, success, and impact on the industry,” said Huffaker. “I look forward to identifying areas of opportunity, specifically focusing on delivery speed, safety, and reliability, and applying my background to various sectors of the business. I am confident we can enhance operations, accuracy, and profitability for the company today and in the years to come.”
On the heels of its 11th consecutive quarter of double-digit revenue growth and four strategic executive appointments this year, CarParts.com remains dedicated to being a disruptive platform that is customer focused. To continuously stay ahead of the curve, the organization is regularly making strides that support the evolution of the business, focusing on positive unit economics, free cash flow generation, operational efficiencies, and delivering an outstanding customer experience.
About CarParts.com
With over 25 years of experience, and more than 50 million parts delivered, we've streamlined our website and sourcing network to better serve the way drivers get the parts they need. Utilizing the latest technologies and design principles, we've created an easy-to-use, mobile-friendly shopping experience that, alongside our own nationwide distribution network and vertically integrated supply chain, cuts out the brick-and-mortar supply chain costs and provides quality parts at competitive pricing.
Our proprietary catalog is constantly expanding, and we continue to add new products, applications, sets, and kits for house brands, as well as premium branded products.
CarParts.com is headquartered in Torrance, California.
Investor Relations:
Ryan Lockwood
IR@carparts.com
Media Relations:
Tina Mirfarsi
tina@carparts.com