Michael E. Faircloth
HanesbrandsAbout Michael E. Faircloth
Michael E. Faircloth is EVP, President, Global Operations at Hanesbrands, appointed in July 2024 after serving as EVP, Supply Chain – Global since 2019; he has held senior operations and supply-chain roles at HBI since 2006 and prior to the spin-off from Sara Lee served as Vice President, Industrialization at Sara Lee . He is 59 and part of HBI’s executive team listed in FY2024, with a career focused on supply chain, manufacturing, and global operations leadership . Company performance context during his tenure includes strong 2024 AIP achievement (Adjusted Operating Income at maximum, debt leverage modifier +20%), and 2024 company TSR of 63.95 with net income of -$320.4M and net organic sales of $3,507M per Pay vs Performance disclosure .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Hanesbrands Inc. | EVP, President, Global Operations | 2024–present | Oversees global operations post-Champion divestiture and transformation to global operating company . |
| Hanesbrands Inc. | EVP, Supply Chain – Global | 2019–2024 | Led HBI’s owned/dedicated supply chain (~75% units produced) enhancing cost efficiency and flexibility . |
| Hanesbrands Inc. | Group President, Global Operations, American Casualwear & E‑Commerce | 2019–2020 | Integrated operations across categories and channels . |
| Hanesbrands Inc. | Group President, Global Supply Chain, IT & E‑Commerce | 2018–2019 | Led global supply and technology operations . |
| Hanesbrands Inc. | President, Chief Global Supply Chain & IT Officer | 2014–2017 | Drove manufacturing and sourcing efficiency and innovation . |
| Hanesbrands Inc. | Chief Global Operations Officer (formerly Chief Global Supply Chain Officer) | 2010–2014 | Managed global operations and supply chain capabilities . |
| Hanesbrands Inc. | SVP/VP, Supply Chain Support; VP Engineering & Quality | 2006–2010 | Built foundational processes for world-class manufacturing and quality . |
| Sara Lee Corporation | Vice President, Industrialization | Pre‑spin (prior to HBI formation) | Industrialization leadership supporting apparel production . |
External Roles
- None disclosed for Faircloth in public company board service or external positions .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $630,000 | $630,000 | $705,191 (actual earned); rate increased to $800,000 effective July 22, 2024 |
| Target Bonus % (AIP) | Not disclosed | 75% of base ($472,500 target) | 100% of base (pro‑rated target $705,191) |
| Actual Bonus Paid (AIP $) | — | $177,660 | $1,165,940 |
| Stock Awards Grant Date Fair Value ($) | $1,382,011 (RSUs+PSAs) | $1,381,997 (RSUs+PSAs) | $1,540,935 (PSAs $964,538; RSUs $576,397, plus July top‑up grants) |
- 2024 compensation adjustments: AIP target increased from 75% to 100%; base salary rate increased 27% to $800,000; LTIP target increased with additional RSU/PSA grants in July 2024 .
Performance Compensation
Annual Incentive Plan (AIP) – FY2024
| Metric | Weight | Threshold | Target | Max | Actual FY2024 | Metric Achievement | Weighted Achievement |
|---|---|---|---|---|---|---|---|
| Net Organic Sales ($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% |
| Initial Total Weighted Achievement | — | — | — | — | — | — | 137.78% |
| Debt Leverage Modifier | — | 4.3x (−20%) | 3.8x (0%) | 3.4x (+20%) | 3.37x | +20% | Final 165.34% |
- Faircloth FY2024 AIP: Target $705,191; Actual payout $1,165,940 .
Annual Incentive Plan (AIP) – FY2023
| Metric | Weight | Threshold | Target | Max | Actual FY2023 | Metric Achievement | Weighted Achievement |
|---|---|---|---|---|---|---|---|
| Net Organic Sales ($MM) | 40% | $5,891 | $6,201 | $6,511 | $5,645 | 0% | 0% |
| Adjusted Operating Income ($MM) | 40% | $495 | $550 | $605 | $405 | 0% | 0% |
| Net Inventory ($MM) | 20% | $1,650 | $1,500 | $1,350 | $1,368 | 188% | 37.6% |
| Total Weighted Achievement | — | — | — | — | — | — | 37.6% |
- Faircloth FY2023 AIP: Actual $177,660 .
Long-Term Incentive Program (LTIP)
- Structure: PSAs (performance shares) and RSUs; PSAs vest on third anniversary and range 0–200% based on pre-established multi-year metrics; RSUs vest 33%/33%/34% annually .
- FY2023 PSA metrics: Cash Flow from Operations growth (50%); Adjusted EPS growth (50%); threshold/target/max 1%/10%/20% CFO growth and 0.5%/4.5%/9% EPS growth; averaged across 2023–2025 cycle .
- FY2024 grants: PSAs and RSUs on Mar 26, 2024; additional RSUs and PSAs on Jul 22, 2024 due to LTIP target increase (same vesting conventions) .
Vesting and Realization
| Year | Shares Vested | Value Realized ($) |
|---|---|---|
| 2024 | 125,075 | $560,198 |
| 2023 | 42,961 | $343,213 |
- Options: No options held/exercised; Company has not granted options since 2020 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 427,155 common shares; RSUs 208,171; no SERP stock equivalents; less than 1% of shares outstanding (353,108,984) . |
| Outstanding Awards (as of Dec 27, 2024) | PSAs unearned: 309,402 units ($2,546,378 at $8.23); RSUs unvested across tranches: 103,134 ($848,793), 83,656 ($688,489), 56,050 ($461,292), 28,279 ($232,736), 14,423 ($118,701); July 2024 top-ups: 4,478 ($36,854) RSUs; 13,434 ($110,562) PSAs . |
| Ownership Guidelines | CEO 6x salary; other NEOs 3x salary; retain 50% of net shares until met; all continuing NEOs in compliance . |
| Hedging/Pledging | Prohibited for directors/officers/employees; pre-clearance required; no short sales/derivatives . |
Employment Terms
| Provision | Key Terms |
|---|---|
| Severance Agreements | Involuntary “not for cause”: 12–24 months benefits based on position and service; monthly severance based on base salary (Committee may include up to 100% target bonus for CEO and Faircloth at discretion) . |
| Change-in-Control (CIC) | Double-trigger vesting; lump sum 2x cash compensation (base + greater of current target or 3‑yr avg AIP + defined contribution plan match) for Faircloth (CEO 3x); no payments if continued employment post-CIC . |
| Potential Payments (Dec 27, 2024 valuations) | Not for cause: Severance $1,600,000; LTIP $858,737; Benefits/perqs $44,301; Total $2,503,039 . |
| CIC Termination | Severance $3,010,382; LTIP $3,715,335; Benefits/perqs $172,894; Total $6,898,610 . |
| Retirement Treatment | If age ≥55 and ≥10 years service, with notice and covenants, employment-contingent restrictions lapse and awards paid after retirement; continued compliance with non‑compete/non‑solicit/confidentiality/non‑disparagement through third anniversary of grant date . |
| Clawbacks | Dodd-Frank clawback for restatements (3-year lookback) and supplemental policy; AIP/LTIP recoupment for code violations/wrongful conduct . |
| Auto‑renewal | Agreements continue unless Company gives ≥18 months’ notice; CIC extends for two years after month of CIC . |
| Non‑Compete/Non‑Solicit | Required to receive severance; payments cease if executive joins a competitor; prohibits soliciting customers/employees and disclosure of confidential information . |
| Tax Gross‑Ups | None provided (except relocation under broad-based program) . |
Compensation Peer Group and Say‑on‑Pay
- FY2024 peer group (used for market comparisons): American Eagle Outfitters, Bath & Body Works, Capri, Carter’s, Foot Locker, Gildan, Kontoor Brands, Levi Strauss, Lululemon, Newell Brands, PVH, Ralph Lauren, Tapestry, The Gap, Under Armour, V.F. Corp, Victoria’s Secret .
- Say‑on‑Pay support: ~94% in 2024; ~93% in 2023 .
Investment Implications
- Alignment: Large RSU/PSA overhang with three-year cliff PSAs and ratable RSUs ties realizable pay to stock performance and multi-year cash/EPS metrics; hedging/pledging ban and stock ownership guidelines (3x salary for Faircloth) reinforce alignment .
- Near-term selling pressure: RSUs from Mar 26, 2024 grant vest 33% annually on Mar 26, 2025/2026/2027; July 22, 2024 top-up RSUs vest 33% annually starting Jul 22, 2025—monitor Form 4s around these dates for potential sales tied to tax withholding and diversification .
- Retention risk: Enhanced 2024 cash AIP payout and LTIP top-ups indicate market-alignment adjustments; severance/CIC economics (2x cash plus benefits) and retirement-friendly vesting reduce departure risk but enforce non-compete and clawbacks .
- Performance levers: AIP and PSAs emphasize adjusted operating income, cash flow, and EPS; 2024 AIP achieved maximum on AOI and benefited from leverage reduction (+20% modifier), supporting strong incentive payout despite modest sales; future payouts hinge on sustained margin/cash improvements post-Champion divestiture .
Appendix: Selected Quantitative Disclosures
Beneficial Ownership as of Feb 24, 2025
| Holder | Common Shares | % of Class | RSUs | SERP Stock Equivalents | Total |
|---|---|---|---|---|---|
| Michael E. Faircloth | 427,155 | * (<1%) | 208,171 | — | 635,326 |
Outstanding Equity Awards (Dec 27, 2024)
| Award Type | Units | Value (@$8.23/share) |
|---|---|---|
| PSAs (2024–2026, assumed 200% for table listing) | 309,402 | $2,546,378 |
| RSUs (Mar 26, 2024 tranche) | 103,134 | $848,793 |
| RSUs (Mar 26, 2024 tranche) | 83,656 | $688,489 |
| RSUs (Mar 26, 2024 tranche) | 56,050 | $461,292 |
| RSUs (Mar 26, 2024 tranche) | 28,279 | $232,736 |
| RSUs (Mar 26, 2024 tranche) | 14,423 | $118,701 |
| RSUs (Jul 22, 2024 top‑up) | 4,478 | $36,854 |
| PSAs (Jul 22, 2024 top‑up) | 13,434 | $110,562 |
Pay versus Performance (Company-level context)
| Year | TSR ($) | Peer Group TSR ($) | Net Income ($MM) | Net Organic Sales ($MM) |
|---|---|---|---|---|
| 2024 | 63.95 | 69.98 | (320.40) | 3,507 |
| 2023 | 34.66 | 73.42 | (17.7) | 5,645 |
| 2022 | 49.42 | 67.96 | (127.2) | 6,178 |
Pension
| Plan | Credited Service (Years) | Present Value ($) |
|---|---|---|
| Legacy Pension Plan (frozen) | 8.5833 | $155,368 |
Director/Policy Notes (alignment and governance)
- Hedging/pledging prohibited; insider pre-clearance; robust clawbacks and executive ownership requirements .
- Related party transactions: none requiring reporting in 2024 .
Notes on Vesting Dates
- RSUs granted Mar 26, 2024: vest 33%/33%/34% on each anniversary of grant (Mar 26, 2025; Mar 26, 2026; Mar 26, 2027) .
- PSAs granted Mar 26, 2024: vest last business day of Feb 2027 subject to performance .
- RSUs/PSAs granted Jul 22, 2024: RSUs vest ratably annually over three years from Jul 22, 2024; PSAs vest on third anniversary subject to performance .
Investment Implications
- Expect periodic 10b5-1/Rule 144 sales or tax-withholding around RSU vest dates; monitor SEC Form 4 filings each March and July cycle for potential supply on the tape .
- Pay-for-performance structure is intact; operational metrics and leverage reduction drove FY2024 payouts—future upside tied to sustaining margin expansion and cash generation described in 2025 proxy financial highlights .