Hezy Shaked
About Hezy Shaked
Hezy Shaked (age 70) is Co-Founder of Tilly’s, serving as Executive Chairman since inception and as President & Chief Executive Officer since September 11, 2024 (Interim CEO from January 21, 2024) . He is the controlling shareholder via Class B stock with 76.6% voting power, aligning strategic control with operating leadership . Performance context: Tilly’s reported revenue decline with net losses over the last two fiscal years; EBITDA moved negative in FY 2024–FY 2025, and pay-versus-performance disclosures show depressed TSR in FY 2024 versus prior years . See tables below for financials and compensation.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Tilly’s, Inc. | Executive Chairman; President & CEO; Interim CEO; Chief Strategy Officer; (historical) President & CEO; Co-CEO | Director since 1984; CEO roles 1982–2006, 2006–2008 (Co-CEO), 2008–2011, Jan–Sep 2024 (Interim), from Sep 2024 (CEO); CSO 2011–Jan 2024 | Founder-led continuity, deep retail operating experience, strategic direction oversight |
External Roles
No public external directorships or executive roles disclosed for Mr. Shaked in the latest proxy. Skip if not disclosed.
Fixed Compensation
| Component | FY 2024 | Notes |
|---|---|---|
| Base Salary | $764,423 | CEO base set at $1,000,000 effective Jan 21, 2024 upon Interim CEO appointment, voluntarily reduced to $650,000 effective June 1, 2024 |
| Other Compensation | $24,000 car allowance | Car allowance provided; standard benefits (health, holidays, 401(k)) |
Multi-year summary for Hezy Shaked:
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | 420,000 | 453,192 | 764,423 |
| Bonus ($) | — | — | — |
| Option Awards ($) | 248,797 | 178,754 | 147,301 |
| Non-Equity Incentive ($) | — | — | — |
| All Other Compensation ($) | 33,150 | 24,923 | 24,000 |
| Total ($) | 701,947 | 656,869 | 935,724 |
Performance Compensation
Annual cash incentive design (FY 2024):
- Metrics and weights: Operating Income (75%) and Comparable Store Sales Growth (25%) .
- CEO payout curve: 0% below minimum; 100% of base at target; 200% of base at maximum .
- FY 2024 thresholds: Comp store sales growth min/target/max = 7%/11%/14%; Operating income pre-bonus min/target/max = $5.0M/$20.0M/$27.2M .
- Actual FY 2024 result: No bonus paid; Company did not achieve minimum thresholds .
| Metric | Weighting | Target | Actual | Payout | Vesting/Timing |
|---|---|---|---|---|---|
| Operating Income (pre-bonus) | 75% | $20.0M | Below minimum | 0% | Paid after audit approval if earned |
| Comparable Store Sales Growth | 25% | 11% | Below minimum | 0% | Paid after audit approval if earned |
Equity awards (time-based stock options):
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Grant mechanics: 4-year equal annual vesting; exercise price at market on grant date; 10-year term; no repricing without shareholder approval .
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CEO grants outstanding (as of Feb 1, 2025): | Grant Date | Size (#) | Exercisable (#) | Unexercisable (#) | Exercise Price ($/sh) | Expiration | Vesting Schedule | |---|---:|---:|---:|---:|---|---| | Apr 2, 2024 | 40,000 | — | 40,000 | 6.75 | 04/02/34 | 25% annually on each Apr 2, 2025–2028 | | Jun 14, 2023 | 50,000 | 12,500 | 37,500 | 6.55 | 06/14/33 | 25% annually on each Jun 14, 2024–2027 | | Mar 23, 2022 | 50,000 | 25,000 | 25,000 | 9.45 | 03/23/32 | 25% annually on each Mar 23, 2023–2026 | | Mar 24, 2021 | 100,000 | 75,000 | 25,000 | 10.73 | 03/24/31 | 25% annually on each Mar 24, 2022–2025 | | Mar 31, 2020 | 75,000 | 56,250 | — | 4.13 | 03/31/30 | 25% annually on each Mar 31, 2021–2024 | | Mar 19, 2019 | 50,000 | 25,000 | — | 11.41 | 03/19/29 | 25% annually on each Mar 19, 2020–2023 |
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Near-term exercise pressure: At the April 17, 2025 record-date share price ($1.67), all recent strikes (6.75, 6.55, 9.45, 10.73) were out-of-the-money, reducing incentive to exercise/sell in the near term .
Equity Ownership & Alignment
| Holding Type | Shares/Units | % of Class | Notes |
|---|---|---|---|
| Class A common directly/indirectly | 103,000 | 0.5% of vote (Class A votes only) | Purchased in the open market; held in Hezy Shaked Living Trust |
| Rights to acquire Class A (vested options within 60 days) | 253,750 | N/A | Vested option tranches enumerated in footnotes |
| Class B common | 7,306,108 | 100% of Class B; 76.6% total vote | Voting control via trust; voting authority over Tilly Levine trust shares by agreement |
| Total voting power | — | 76.6% | Aggregate voting control across A and B |
Policies:
- Anti-hedging and anti-pledging: Company prohibits hedging and pledging of company securities for directors/officers/employees .
Ownership guidelines:
- Executive/director stock ownership guidelines not disclosed. Skip if not disclosed.
Employment Terms
- Appointment and salary: Interim CEO (Jan 21, 2024) with base raised to $1,000,000; subsequently appointed CEO (Sep 11, 2024) with no additional change; base voluntarily reduced to $650,000 effective June 1, 2024 .
- Incentive eligibility: Participates in annual cash bonus plan (Operating Income, Comp Store Sales) .
- Benefits/perquisites: Car allowance; standard employee benefits; 401(k) plan with discretionary matching .
- Severance/Change-in-control: No individual Shaked severance/CIC agreement disclosed; plan-level equity change-in-control terms provide double-trigger vesting if terminated without cause within 12 months post-CIC (or accelerated vesting if awards not assumed) .
- Clawback: Company has compensation recovery policy in line with SEC/NYSE rules; covers time- and performance-vesting equity .
Board Governance
- Board service: Director since 1984; Executive Chairman; dual role as CEO and Chairman since Sep 2024 .
- Independence: Company is a “controlled company”; Mr. Shaked is not independent; majority of board is independent; committees comprised of independent directors .
- Committees: Mr. Shaked serves on no standing committees; Audit (Chair: Seth Johnson), Compensation (Chair: Doug Collier), Nominating & Governance (Chair: Janet Kerr) .
- Lead Independent Director: None designated; board periodically reviews leadership structure .
- Executive sessions: Independent directors expect to hold at least two per year .
- Attendance: Board met 12 times in FY 2024; no director attended fewer than 75% of meetings; all directors attended the 2024 annual meeting .
Director compensation:
- Non-employee director retainer: $40,000 cash; committee chairs: Audit $15,000; Compensation/Nominating $12,000; committee member fees: Audit $8,000; Compensation/Nominating $5,000; annual restricted stock grant fair value $80,000 (vesting in two annual installments); Mr. Shaked received no additional compensation for board service .
Performance & Track Record
Financial performance (annual):
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Revenues ($) | 672,280,000 | 623,083,000 | 569,453,000 |
| EBITDA ($) | 25,338,100* | −14,717,000* | −32,712,000* |
| Net Income ($) | 9,677,000 | −34,492,000 | −46,229,000 |
*Values retrieved from S&P Global.
Pay vs performance (TSR reference):
- FY 2024 TSR (company $100 initial basis): $39.82 ; FY 2023: $69.16 ; FY 2021: $117.16 .
Compensation alignment observations:
- Annual bonus plan paid zero in FY 2024 and FY 2023 due to underperformance versus thresholds—evidence of pay-for-performance enforcement .
- CEO equity awards are time-vested options, not PSUs; the plan allows performance awards but none disclosed for Mr. Shaked in FY 2024 .
Major governance items:
- Say-on-pay approval ~91% at 2024 annual meeting, indicating shareholder support for compensation approach .
Related Party Transactions (Governance Red Flags)
- Headquarters & distribution center lease with Shaked Holdings: $2.1M rent in FY 2023; CPI-based escalators; lease through Dec 31, 2027 .
- E-commerce fulfillment and office/warehouse leases with Amnet Holdings: $1.5M and $0.6M rent in FY 2023; CPI/minimum escalators; leases through Oct 31, 2031 and Jun 30, 2032 .
- Charitable support: $200,000 annual board-approved donation to Tilly’s Life Center (founded/run by Ms. Levine); customer round-up donations of $1.2M in FY 2023; TLC sublease of 5,887 sq ft in company facility through Jan 31, 2027 .
Compensation Peer Group (Benchmark Context)
Peer set (Mercer study, April 2022): Boot Barn, Buckle, Build-a-Bear Workshop, Cato, Chico’s FAS, Citi Trends, Destination XL, Duluth, Express, J.Jill, Lulu’s Fashion Holdings, Torrid, Zumiez. Used for informational context, not direct benchmarking .
Say-on-Pay & Shareholder Feedback
- 2024 say-on-pay approval ~91%; Company adopted annual say-on-pay frequency per shareholder preference .
- 2023 approval ~92% .
Expertise & Qualifications
- Core credentials: Founder with over 40 years in specialty retail; deep operational knowledge and strategic relationships .
Equity Overhang and Plan Capacity (Context)
- 2025 proposal to increase share reserve under the equity plan by 2,000,000 to 8,613,900 shares; estimated overhang post-approval ~17.9% and three-to-four years of capacity at historical burn .
Investment Implications
- Alignment: Zero bonus payouts in FY 2024/FY 2023 reflect pay-for-performance rigor; however, CEO equity awards are time-based options (no PSUs), reducing direct linkage to multi-year financial outcomes .
- Control and governance: Dual role (CEO + Executive Chairman) within a controlled company lacking a lead independent director heightens governance risk, though committees are independent and executive sessions are held .
- Insider selling pressure: With the stock at $1.67 near the FY 2025 record date, all recent CEO option strikes are out-of-the-money, lowering near-term exercise/sell pressure; anti-hedging/anti-pledging policies further mitigate misalignment risk .
- Financial trajectory: Revenues have declined and net losses widened through FY 2025; sustained negative EBITDA underscores execution risk and increases importance of operational turnaround under founder-CEO leadership .
- Related party exposure: Significant leases with entities controlled by founders introduce conflicts and fixed cost risks; investors should monitor terms and any changes closely .