Joseph W. Cavaliere
HanesbrandsAbout Joseph W. Cavaliere
Joseph W. Cavaliere is President, Innerwear – Global and a named executive officer (NEO) at Hanesbrands. His 2024 pay mix reflects Hanesbrands’ pay‑for‑performance model: base salary raised 8.7% to $815,000 effective March 1, 2024, a 100% of salary Annual Incentive Plan (AIP) target based on company metrics, and a $2.2 million LTIP target with 60% PSAs and 40% RSUs . Company performance metrics tied to NEO pay emphasized net organic sales and adjusted operating income for 2024 AIP, and multi‑year cash flow, operating margin, and relative TSR for PSAs . Hanesbrands reported innerwear market share gains in 2024 and exited the year with YoY topline growth in Q4, supporting the AIP outcome and margin expansion narrative . Company TSR for 2024 (pay‑versus‑performance table) was $63.95 vs peer group TSR $69.98, with net organic sales of $3,507 million .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $741,667 | $750,000 | $804,167 |
| All Other Compensation ($) | $266,027 | $81,237 | $94,684 |
| Notes | Base salary raised to $815,000 effective 3/1/2024 | AIP target set at 100% of salary | AIP target $804,167; LTIP target $2,200,000 |
Performance Compensation
Annual Incentive Plan (AIP) – Company Metrics and Results (Fiscal 2024)
| Metric | Weighting | Threshold | Target | Maximum | FY2024 Result | Metric Achievement (% of Target) | Weighted Achievement |
|---|---|---|---|---|---|---|---|
| Net Organic Sales ($MM) | 50% | $3,387 | $3,565 | $3,743 | $3,507 | 75.6% | 37.78% |
| Adjusted Operating Income ($MM) | 50% | $339 | $377 | $415 | $415 | 200% | 100% |
| Debt Leverage Modifier (Net Debt/Adj. EBITDA) | +/-20% | 4.3x (‑20%) | 3.8x (0%) | 3.4x (+20%) | 3.37x | +20% | — |
| Final Total AIP Achievement | — | — | — | — | — | — | 165.34% |
AIP design changes in 2024 increased weighting of sales and operating income to 50%/50%, added a debt leverage modifier (+/‑20%), and restored 200% cap on financial metrics (240% including modifier), with payout capped at 100% if adjusted operating income threshold not met .
AIP payout for Cavaliere:
| Name | Target ($) | Actual ($) |
|---|---|---|
| Joseph W. Cavaliere | $804,167 | $1,329,585 |
Long‑Term Incentive Program (LTIP) – Grants, Metrics, and Vesting (Fiscal 2024 awards)
| Component | Weight | Grant Date | Units (#) | Fair Value ($) | Vesting |
|---|---|---|---|---|---|
| PSAs (2024–2026 cycle) | 60% | 3/26/2024 | Threshold: 61,567; Target: 246,269; Max: 492,538 | $1,471,704 | Earn 0–200% based on 3‑year metrics; vest last business day of Feb 2027 |
| RSUs | 40% | 3/26/2024 | 164,179 | $879,999 | Ratable 33%, 33%, 34% over 3 years |
PSA performance metrics and weights (2024–2026 cycle): three‑year average adjusted operating margin (40%), three‑year cumulative cash flow from operations (40%), and three‑year cumulative relative TSR vs S&P 1500 Apparel, Accessories & Luxury Goods Index (20%); TSR leg capped at 100% if absolute TSR is negative .
Prior PSAs (2022–2024 cycle) vested at 66.67% of target; Cavaliere’s award vested on Feb 28, 2025 .
Multi‑Year Compensation Summary (Total, Mix)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Stock Awards ($) | $1,699,992 | $2,200,001 | $2,351,703 |
| Non‑Equity Incentive Plan (AIP) ($) | — | $282,000 | $1,329,585 |
| Total ($) | $2,707,686 | $3,313,238 | $4,580,139 |
Equity Ownership & Alignment
- Beneficial ownership (as of Feb 24, 2025): 254,909 shares directly; 315,227 RSUs; 216 stock equivalent units; total 570,352 (less than 1% of shares outstanding) .
- Outstanding equity awards (12/27/2024; market value at $8.23 per share): RSUs 164,179 units ($1,351,193); PSAs unearned at maximum 492,538 units ($4,053,588). Cavaliere holds no stock options .
- Stock ownership guidelines: CEO 6× salary; other NEOs 3× salary; 50% of net shares retained until guideline met. Hanesbrands reports all continuing NEOs are in compliance .
- Hedging and pledging: Prohibited for directors and officers under insider trading policy .
Employment Terms
- Severance (involuntary termination not for cause): Lump‑sum equal to 12–24 months of base pay based on position and service; Cavaliere’s modeled severance equals $815,000 plus continuation of benefits ($63,737) and pro‑rated incentive for the year of termination; non‑compete, non‑solicit, confidentiality and release required .
- Change‑in‑Control (double‑trigger): Lump‑sum equal to 2× “cash compensation” (base salary plus greater of current target or average AIP for prior 3 years), plus benefits continuation and equity vesting per plan, subject to restrictive covenants; modeled CoC cash payment for Cavaliere is $3,238,333; benefits/perquisites $261,511; equity vests per plan terms (qualifying termination within 2 years or no qualifying replacement awards) .
- Clawbacks: Dodd‑Frank policy for erroneously awarded incentive compensation; supplemental clawback covers broader compensation and code‑of‑conduct violations for equity and AIP awards .
- Deferred compensation (SERP – defined contribution component, 2024): Company contribution $29,647; year‑end balance $33,183 .
Compensation Structure Analysis
- Year‑over‑year mix shifts: 2024 salary increased to market; LTIP target unchanged vs 2023; RSU/PSA split moved to 60% PSAs/40% RSUs to heighten performance linkage .
- AIP design tightened to emphasize profitability and deleveraging: equal weighting of sales and operating income and addition of leverage modifier improved alignment to margin expansion and cash generation priorities following Champion divestiture .
- Equity risk/retention: Multi‑year cliff PSAs and three‑year RSU vesting, combined with hedging/pledging prohibitions and ownership guidelines, sustain alignment and retention .
- No option repricing: Plan prohibits repricing of underwater options/SARs without shareholder approval; options not used since 2020 .
Performance & Track Record (Context)
- Innerwear momentum: Hanesbrands gained market share in innerwear in 2024, launched consumer‑led innovations (Hanes Originals SuperSoft, Hanes Moves/X‑Temp, Bali Breathe), and streamlined supply chain and e‑commerce—tailwinds for Cavaliere’s segment .
- Financial progress: Margin expansion and >$1B debt reduction in 2024 lowered leverage nearly two turns; AIP finalized at 165.34% of target on maximum adjusted operating income and favorable leverage .
- Pay‑versus‑performance: 2024 TSR $63.95 vs peer group $69.98; net organic sales $3,507 million (company‑level) .
Related Party Transactions and Governance
- Related party transactions: None requiring SEC reporting in 2024 .
- Say‑on‑Pay support: Approximately 94% support in 2024 (including abstentions, excluding broker non‑votes) .
Investment Implications
- Alignment: Cavaliere’s incentives are tied to net organic sales, operating income, cash flow, margin, and rTSR—metrics that directly drive deleveraging, margin expansion, and equity value; 2024 AIP mechanics and 60% PSA weighting strengthen pay‑for‑performance .
- Retention and potential selling pressure: Significant unvested PSAs and RSUs with multi‑year schedules and share‑retention requirements create ongoing alignment and reduce near‑term liquidity; equity deliveries on vesting could create share delivery events, but hedging/pledging prohibitions and ownership guidelines temper selling incentives .
- Downside protection/CoC economics: Double‑trigger CoC at 2× cash compensation plus benefits and equity treatment provides security amid strategic transitions without single‑trigger windfalls; severance requires non‑compete/non‑solicit, maintaining business protection .
- Execution risk: Company‑level innerwear share gains, margin expansion, and deleveraging support AIP/PSA achievement assumptions; sustaining margin and cash flow against input cost, retail mix, and macro demand remains critical for PSA realization through 2027 .