Kenneth E. Jaycox, Jr.
AUTOZONEAbout Kenneth E. Jaycox, Jr.
Senior Vice President, Commercial at AutoZone; externally hired in July 2024 as part of the leadership realignment and addition of external talent to the Executive Committee . Company performance context: FY25 revenue was $18.9B and diluted EPS was $144.87; AutoZone averaged ~20.8% TSR over the past 20 years and completed $1.5B of share repurchases in FY25 . Say‑on‑pay support improved to over 89% of votes cast in FY25, signaling shareholder alignment with the compensation program .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| AutoZone (AZO) | Senior Vice President, Commercial | 2024–present | External executive hire to strengthen the leadership bench during FY24 realignment |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (% of Salary) | Target Bonus ($) | Actual Bonus Paid ($) |
|---|---|---|---|---|
| FY2024 | 48,077 | 60.0% | 28,846 | 28,647 |
| FY2025 | 500,000 | 60.0% | 300,000 | 290,251 |
Notes:
- FY25 base salary remained $500,000 (0% increase; new‑hire competitive with market data) .
- FY25 annual incentive plan company factor resulted in a 96.75% payout of target for NEOs, including Jaycox .
Performance Compensation
Annual Incentive (Management Incentive Plan)
- Design and metrics: Annual cash incentive tied to EBIT and ROIC as drivers of Economic Profit; for FY25, the individual modifier was removed following shareholder feedback .
- FY25 payout: Company factor 96.75% of target; Jaycox’s actual payout $290,251 vs. target $300,000 .
| Metric | Weighting | FY25 Target | FY25 Actual/Payout | Vesting/Timing |
|---|---|---|---|---|
| EBIT + ROIC (Economic Profit framework) | Not disclosed | $300,000 | $290,251 (96.75% of target) | Paid October 2025 |
Long‑Term Incentives (Stock Options)
AutoZone grants non‑qualified stock options as the primary LTIP vehicle; standard terms are 10‑year life with multi‑year vesting. Beginning FY25, most executive committee options vest 50% after two years, then 25% in years three and four; earlier grants vest 25% annually over four years. Strike prices are set at fair market value; no discounting. CEO receives a portion in premium‑priced options; other NEOs, including Jaycox, receive standard options .
| Grant Date | # Options | Exercise Price ($/sh) | Grant Date Fair Value ($) | Vesting Schedule | Expiration |
|---|---|---|---|---|---|
| 7/29/2024 | 4,713 | 3,072.66 | 5,298,895 | 25% annually over 4 years (per standard schedule) | 7/29/2034 |
| 10/11/2024 | 2,917 | 3,129.78 | 3,299,639 | 50% after 2 years; 25% in years 3 and 4 (FY25 structure) | 10/11/2034 |
Additional context:
- FY25 closing price on Aug 30, 2025 was $4,198.53, indicating these grants were in‑the‑money at year‑end relative to their strikes .
- Jaycox had no option exercises and no stock vesting in FY25, limiting realized equity cash flow to date .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (10/20/2025) | 10,299 total: 9 shares + 10,290 options exercisable within 60 days; <1% of shares outstanding |
| Stock ownership guidelines | SVP requirement: 2x base salary; 5‑year transition to comply; must hold 50% of net shares acquired until compliant |
| Hedging/pledging | Prohibited from hedging, pledging, margining, and short sales; pre‑clearance and blackout periods apply |
Outstanding options at FY25 year‑end:
| Grant Date | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration |
|---|---|---|---|---|
| 7/29/2024 | 1,178 | 3,535 | 3,072.66 | 7/29/2034 |
| 10/11/2024 | — | 2,917 | 3,129.78 | 10/11/2034 |
| Total | 1,178 | 6,452 | — | — |
Source: Outstanding Equity Awards table .
Employment Terms
| Term | Jaycox (SVP, Commercial) |
|---|---|
| Start date | Hired July 2024; SVP Commercial |
| Severance framework | Covered by Severance and Non‑Compete Agreement; salary continuation 12–24 months based on service; as of 8/30/2025, involuntary not‑for‑cause scenario quantified below |
| Involuntary Not‑for‑Cause (as of 8/30/2025) | Severance pay $750,000; annual incentive $290,251; benefits continuation $26,856; total $1,067,107 |
| Change‑in‑control | No specific CIC cash severance amounts shown for Jaycox in the FY25 potential payments table |
| Death/Disability examples | Death: $1,922,980; Disability: $2,827,751 (as of 8/30/2025), including insurance and option treatment per plan |
| Non‑compete / non‑solicit | Two years post‑termination for executive officers under Severance and Non‑Compete Agreements |
| Clawback | Non‑discretionary recoupment on restatements (no‑fault) and discretionary recovery for willful misconduct; updated per SEC/NYSE rules |
| Tax gross‑ups | No tax gross‑ups for NEOs on benefits/perqs other than relocation‑related items |
Perquisites and relocation (FY25 “All Other Compensation” detail):
- Perquisites/personal benefits: $18,298; relocation: $160,195; matching charitable contributions: $5,500; imputed income: $6,999; company contributions to plans: $2,308; life insurance premiums: $1,308 .
Performance & Track Record
- Company highlights around his tenure: FY25 revenue $18.9B and diluted EPS $144.87; $1.5B buybacks; 7,657 stores; long‑term TSR ~20.8% over 20 years .
- FY25 option exercises/vestings: none by Jaycox, indicating unvested equity remains a retention lever and limiting near‑term selling pressure .
Compensation Governance, Peer Group, and Say‑on‑Pay
- Peer group used for benchmarking FY25 compensation matters: Advance Auto Parts; Bath & Body Works; Costco; Dick’s; Dollar General; Dollar Tree; Genuine Parts; LKQ; Lowe’s; O’Reilly; Sherwin‑Williams; Tractor Supply; Ulta Beauty; W.W. Grainger .
- Independent compensation consultant (Pearl Meyer) supports the Compensation Committee’s process .
- Say‑on‑pay: improved support to over 89% of votes cast in FY25 .
Compensation Structure Observations
- Cash vs equity mix: For NEOs, a significant portion of pay is variable/at‑risk; Jaycox’s FY25 compensation included base salary, annual incentive tied to EBIT/ROIC, and stock options as the sole LTIP vehicle .
- Metric changes: The individual modifier in the annual plan was eliminated effective FY25 after shareholder feedback, increasing consistency of team‑based outcomes .
- Option program design: Fixed run‑rate (≈0.9% of shares or less) with 10‑year option life; from FY25, majority vest 50% after two years (then 25%/25%), intended to lengthen performance focus and reinforce retention; CEO only receives a premium‑priced tranche—non‑CEO NEOs (including Jaycox) do not .
Investment Implications
- Alignment: Jaycox’s LTIP is 100% options with multi‑year vesting and strikes well below FY25 year‑end price ($4,198.53 vs. $3,072.66 and $3,129.78), creating levered exposure to long‑term TSR and strong alignment with shareholders .
- Retention and selling pressure: No FY25 exercises/vestings and significant unvested options (6,452) suggest retention incentives are strong and near‑term selling pressure from insider exercises is limited; watch the two‑year cliff on the 10/11/2024 grant for potential exercise windows starting in FY27 .
- Risk controls: Prohibitions on hedging/pledging, robust ownership guidelines (2x salary for SVP), and an updated no‑fault clawback mitigate governance risk and align with best practices .
- Downside/caveats: Cash severance is modest (1.5 years indicated as of 8/30/2025) and no specific CIC cash multiple shown for Jaycox, which limits shareholder cost but could be a competitive retention consideration versus peers using RSUs/PSUs or richer CIC terms .
Overall: Jaycox’s package is heavily performance‑ and stock‑price‑linked with multi‑year option vesting, strong governance guardrails, and modest severance provisions—supportive of alignment and retention, with limited immediate insider‑selling signals.