Daniel Sullivan
FIVE BELOWAbout Daniel Sullivan
Daniel (Dan) Sullivan is Chief Financial Officer of Five Below, appointed effective October 6, 2025, responsible for Finance, Information Technology and Asset Protection, reporting to CEO Winnie Park . He is a two-time public company CFO with ~35 years of finance and operating experience, previously CFO at Party City and Ahold USA, and CFO/COO roles at Heineken USA/International, most recently EVP/COO at Edgewell Personal Care; he holds a B.S. in Accounting from Duquesne University . Five Below’s executive pay design ties incentives to net sales and post-incentive adjusted operating income in the annual bonus and to adjusted operating income and relative TSR in PRSUs; in the last full PRSU cycle (granted 2022), awards paid at ~7% of target (AOI 0%, TSR 13.8%), signaling rigor in performance goals .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Edgewell Personal Care | EVP, Chief Operating Officer; previously CFO | 2019–2025 | Architected growth strategy delivering topline growth and margin expansion |
| Party City Holdco Inc. | Chief Financial Officer | 2016–2019 | Senior finance leadership at public retailer |
| Ahold USA | Chief Financial Officer | n/d | Led finance for major U.S. grocer |
| Heineken USA / Heineken International | CFO and COO (USA); CFO (International) | n/d | Combined finance and operating leadership in consumer sector |
External Roles
No public company board or external directorships disclosed for Sullivan in Company filings .
Fixed Compensation
| Component | Terms / Amount |
|---|---|
| Base Salary | $850,000 per year |
| Signing Bonus | $500,000; repayable if resignation or termination for cause within first 12 months |
| Annual Bonus (STIP) Target | 50% of annualized base salary for initial eligibility year; 100% of base salary thereafter |
| Relocation | Relocation assistance per policy; subject to repayment if resigns or termination for cause within 24 months |
| Severance Eligibility | Executive Severance Plan: lump-sum 12 months base salary + COBRA premium reimbursement up to 12 months upon termination without cause or resignation for good reason |
| Non-Compete / Non-Solicit | 12-month post-termination non-compete and non-solicit covenants |
Performance Compensation
- Annual Bonus Plan (company framework): Metrics are 50% net sales and 50% post-incentive adjusted operating income; each pays 0–200% with caps and threshold conditions, as used for NEOs in fiscal 2024 .
- Long-Term Incentives for Sullivan:
- New-hire RSUs: $2,000,000 grant value, vesting in three equal annual installments on each of the first three anniversaries of appointment (Oct 2026/2027/2028), subject to continued service .
- 2026 LTI awards: $1,800,000 grant value, allocated 60% PRSUs and 40% RSUs .
- Company PRSU design (context for performance alignment):
- Metrics: 50% three-year cumulative adjusted operating income; 50% relative TSR versus a defined retail peer set; payout range 0–200% .
- 2025 plan updates: mix shifted to 60% PRSUs / 40% RSUs; RSU vesting moved to 33.33% per year over three years, aligning with Sullivan’s three-year RSU vesting cadence .
Performance Compensation Structure Details
| Instrument | Metric | Weighting | Target/Payout Mechanics | Vesting |
|---|---|---|---|---|
| STIP (Cash) | Net Sales | 50% | 0–200% of component; capped at target if operating income below threshold | Annual, subject to employment terms |
| STIP (Cash) | Post-incentive Adjusted Operating Income | 50% | 0–200% of component | Annual |
| PRSUs | 3-yr Cumulative Adjusted Operating Income | 50% of PRSUs | Threshold 50%, Target 100%, Max 200% (interpolated) | Generally vest at end of performance period (3 years) |
| PRSUs | Relative TSR vs peer group | 50% of PRSUs | Threshold 25% at 30th pctile; Target 100% at 50th; Max 200% at 80th (interpolated) | Generally vest at end of performance period |
| RSUs | Time-based | Remainder | Time-vest per plan; for Sullivan new-hire: 1/3 annually over 3 years ; for 2025 awards: 33.33% annually over 3 years | Service-based vesting |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Initial Beneficial Ownership | Form 3 filed Oct 8, 2025 reported no beneficial ownership as of 10/06/2025 (no securities reported) |
| New-Hire Equity | RSUs valued at $2,000,000; 3-year equal annual vesting, creating scheduled future supply starting Oct 2026 |
| 2026 Equity | $1,800,000 with 60% PRSUs / 40% RSUs mix |
| Ownership Guidelines (CFO) | Required to hold shares equal to 3x base salary; executives generally have 5 years from hire to comply; must hold 50% of net shares from option exercises/RSU settlements until compliance |
| Hedging/Pledging | Company prohibits hedging and pledging of Company stock; short sales and derivatives are also prohibited |
| Clawback | Company clawback policy mandates recovery of erroneously awarded incentive comp in restatement or misconduct scenarios |
Employment Terms
| Term | Provision |
|---|---|
| Start Date | October 6, 2025 |
| Reporting Line | CEO (Winnie Park); scope includes Finance, IT, Asset Protection |
| Work Location | Philadelphia HQ; relocation required within 75 miles (with relocation benefits) |
| At-Will Employment | Employment is at-will; standard confidentiality and IP assignment obligations |
| Severance | Executive Severance Plan: 12 months base salary lump sum + COBRA premium reimbursement up to 12 months (without cause/for good reason) |
| Restrictive Covenants | 12-month non-compete and non-solicit post-termination |
Compensation Structure Analysis
- Cash vs Equity Mix: Initial package leans heavily to equity (new-hire $2.0M RSUs + $1.8M 2026 LTI) versus $0.85M base and modest initial bonus target, aligning payouts with long-term performance and retention .
- Performance Emphasis: 60% of 2026 LTI is PRSUs tied to AOI and relative TSR, mirroring rigorous company metrics that recently paid out well below target for prior PRSU cycles (≈7% for 2022 grants), indicating challenging goals and reduced windfall risk .
- Retention Features: Three-year RSU vesting cadence and 12-month non-compete support retention; signing bonus clawback in first year further discourages early departure .
- Shareholder Protections: Prohibitions on hedging/pledging, strict ownership guidelines (3x salary for CFO), and a robust clawback policy bolster alignment and mitigate governance risk .
Say-on-Pay & Peer Context
- Say-on-Pay: Shareholders approved executive compensation with ~96% support at the June 2024 meeting, suggesting broad endorsement of pay design .
- Peer Design Update: In 2025, Five Below increased PRSU weighting to 60% and shifted RSU vesting to three equal annual tranches to align with market practice and retention objectives, consistent with Sullivan’s award structure .
Investment Implications
- Alignment: Sullivan’s package is skewed to multi-year equity with performance-heavy PRSUs, tying upside to AOI expansion and relative TSR—key levers for value creation in value retail .
- Retention and Overhang: RSUs vest evenly over three years beginning October 2026, indicating predictable supply; hedging/pledging bans and 3x salary ownership guideline reduce adverse selling pressure and enhance alignment .
- Execution Risk: Company history of low PRSU payouts (≈7% for 2022 grants) underscores challenging hurdles; success will hinge on driving sales and operating income while achieving competitive TSR under Sullivan’s finance leadership .