Jodi Caro
Ulta BeautyAbout Jodi Caro
General Counsel, Chief Risk & Compliance Officer and Corporate Secretary of Ulta Beauty since August 2015; announced intention to retire in spring 2025. Education: JD (Chicago‑Kent College of Law, IIT) and BA in English/Law Studies (Marquette University). Age 58 (as of June 25, 2024). Tenure coincided with ULTA’s solid long‑term performance: FY2024 net sales $11.3B, operating income $1.6B; five‑year TSR 54% (fiscal 2020–2024) but one‑year TSR −18% in a tougher beauty backdrop. Annual incentives tied to EBT (fiscal 2024 Incentive EBT ~$1.58B), and LTIP based 50% on two‑year revenue growth and 50% on two‑year EBT growth with a TSR modifier.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| WEC Energy Group / Integrys | VP, General Counsel & Secretary; Chief Compliance & Ethics Officer | 2008–2015 | Led legal, compliance, governance; executed major asset transactions and Integrys Energy Services sale, strengthening portfolio risk management. |
| Jodi J. Caro, LLC | Principal | 2006–2008 | Provided general counsel/transactional support to early-stage and mature companies nationwide. |
| Looking Glass Networks | Co‑founder & General Counsel | 2000–2006 | Built facilities‑based telecom platform; managed complex regulatory compliance and growth transactions. |
| MCI/WORLDCOM | In‑house counsel | 1993–2000 | Supported corporate development amid consolidation; governance and compliance in regulated telecom. |
| Convenient Food Mart | Associate Counsel | 1991–1993 | Retail/franchise legal support. |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Retail Litigation Center | Vice‑Chair | 2019–Present | Industry legal advocacy and policy leadership. |
| Communities in Schools of Chicago | Director; Gov/Exec Committees | 2011–Present | Non‑profit governance; community impact. |
| Chicago‑Kent College of Law | Board of Advisors | Ongoing | Legal education advisory. |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 620,797 | 658,050 | 690,955 |
| Target Bonus (% of salary) | 65% (unchanged from 2022) | 65% | 65% |
| Actual Annual Bonus Paid ($) | 807,036 | 418,494 | 273,335 |
Notes:
- FY2024 payout reflected Incentive EBT achievement below target; company-wide payout 60.86% of target.
Performance Compensation
| Instrument | LT Mix (FY2024) | Metric | Target Definition | Result/Modifier | Vesting |
|---|---|---|---|---|---|
| Performance‑Based RSUs (PBSs) | 50% | Revenue growth | Two‑year cumulative revenue | For FY2023 grant: target $22.7B vs. actual $22.5B → 84% payout; TSR ≥10% can lift to 100% | Earn over 2 yrs; deliver after 3rd‑year time vest (Mar 2027 for 2024 grant) |
| Performance‑Based RSUs (PBSs) | 50% | EBT growth | Two‑year cumulative EBT | For FY2023 grant: target $3.4B vs. actual $3.3B → 84% payout; TSR ≥10% can lift to 100% | 3‑year schedule as above |
| Stock Options (NQ) | 30% | Share price appreciation | 10‑year term; grant FMV | Value only if stock rises; 25% annual vest over 4 years | 25% per year (2025–2028) |
| Time‑based RSUs | 20% | Retention | 3‑year cliff | No dividends on unearned; alignment via holding requirements | Cliff vest at 3 years (Mar 2027 for 2024 grant) |
Jodi Caro’s FY2024 grant detail:
- PBSs: 992 target shares; grant date 3/29/2024; grant date fair value $518,697.
- Stock Options: 1,973 options @ $522.88; grant date fair value $311,063.
- RSUs: 397 RSUs; grant date fair value $207,583.
Equity Ownership & Alignment
| Item | Value/Count |
|---|---|
| Beneficial Ownership (Apr 14, 2025) | 12,884 shares; <1% of outstanding (45,147,875 shares) |
| Options – Exercisable | 4,595 |
| Options – Unexercisable | 1,893 |
| Stock Awards – Not Vested (RSUs) | 1,897 shares; market value $781,849 |
| Equity Incentive Plan – Unearned Shares (PBSs) | Target counts outstanding per vest tables; subject to TSR modifier |
| Ownership Guidelines | Other NEOs: 3× base salary; retain ≥50% net shares until met; executives ≥5 years in role are in compliance |
| Hedging/Pledging Policy | Prohibited: derivatives, hedging, margin accounts, pledging |
Vesting schedule (as of Feb 1, 2025):
| Award Type | 3/15/2025 | 3/15/2026 | 3/15/2027 | 3/15/2028 |
|---|---|---|---|---|
| NQ Options (#) | 619 | 469 | 369 | — |
| PBS (#) | — | 905 | 992 | — |
| RSU (#) | 3,836 | 362 | 397 | — |
Realizations (signals of potential selling pressure):
| Year | Option Exercises (Shares) | Value Realized ($) | RSUs Vested (Shares) | Value Realized ($) |
|---|---|---|---|---|
| 2023 | 5,241 | 1,110,836 | 2,250 | 1,179,405 |
| 2024 | — | — | 3,228 | 1,730,143 |
Employment Terms
- Executive CIC & Severance Plan (double‑trigger):
- Severance multiple: 2.0× (salary + bonus; greater of termination/CIC values).
- Pro‑rated annual bonus (actual performance).
- Accelerated vesting of time‑based equity; performance‑based equity vests at greater of target or performance‑earned (subject to TSR).
- Company‑paid COBRA up to 18 months; “best‑net” excise tax cutback provision.
- Continued vesting eligibility upon qualified retirement (age+service ≥70 threshold, from 2022 grants onward).
- Robust clawback policy (SEC/Nasdaq 10D‑1 compliant), with recovery for restatements and misconduct/competitive covenant breaches.
Compensation & Incentives (Multi‑Year)
| Year | Salary ($) | Stock Awards ($) | Option Awards ($) | Non‑Equity Incentive ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|---|
| 2022 | 620,797 | 1,139,705 | 279,395 | 807,036 | 48,162 | 2,895,095 |
| 2023 | 658,050 | 691,364 | 296,189 | 418,494 | 55,369 | 2,119,466 |
| 2024 | 690,955 | 726,280 | 311,063 | 273,335 | 57,390 | 2,059,023 |
Program design highlights (company‑wide for NEOs):
- Annual incentive: single metric (EBT) with threshold/target/max at 87%/100%/110% of target; FY2024 paid 60.86% of target following Incentive EBT of $1.59B vs. $1.73B target.
- LTIP mix (PBS 50% / Options 30% / RSU 20%) to balance growth, profitability, and retention; options vest 25% annually; RSUs cliff at 3 years; PBSs have two‑year performance + TSR modifier + 3rd‑year time vest.
Performance & Track Record
- Company performance during her tenure includes: FY2024 net sales $11.3B (+0.8% YoY), operating income $1.6B (13.9% margin), and five‑year TSR 54% (FY2020–FY2024); one‑year TSR −18%.
- Strategic initiatives cited: Legal lead for Target shop‑in‑shop partnership negotiations; ESG oversight; privacy and risk governance leadership.
Compensation Committee & Peer Group
- Committee independence; use of Pay Governance (independent consultant; no conflicts) and annual risk review.
- 2024 peer group: Bath & Body Works, Burlington, Dick’s, Lululemon, PVH, Ross, Tractor Supply, Under Armour, V.F., Williams‑Sonoma.
- 2025 update: Capri removed; AutoZone and O’Reilly added to maintain robust size/revenue comparability.
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑pay approval ~89% at 2023/2024 annual meetings, affirming overall program support; continued investor engagement on compensation and ESG.
Risk Indicators & Red Flags
- No excise tax gross‑ups; no perquisite tax gross‑ups; no option repricing/buyouts; hedging/derivatives/margin/pledging prohibited.
- Robust clawback (restatements and misconduct) and double‑trigger CIC protections reduce windfall risk.
- Retirement transition disclosed (Item 5.02) — near‑term leadership/retention risk in legal, risk, and compliance functions.
Equity Ownership & Vesting Mechanics (Detail)
| Aspect | Policy/Mechanic |
|---|---|
| Ownership guidelines | 3× salary for NEOs; 50% net shares retained until met; 5‑year compliance window; executives ≥5 years in role are compliant. |
| Grant timing | Post‑earnings trading window; annual LTIP grants made after 10‑K filing; no grants near material filings. |
| Dividends on unearned awards | Not paid on PBS/RSUs until vested. |
Investment Implications
- Alignment: High proportion of at‑risk pay (EBT and two‑year revenue/EBT PBSs with TSR cap/modifier) plus ownership guidelines and anti‑hedging create solid shareholder alignment.
- Near‑term supply risk: 2023 option exercises and ongoing RSU vesting events indicate periodic insider‑related flow; 2025 retirement could prompt additional vest/settlement activity, though policies mitigate hedging/pledging.
- Governance quality: Independent comp consultant, no gross‑ups/repricing, robust clawback; double‑trigger CIC and best‑net cutback are investor‑friendly.
- Execution continuity: Legal/risk transition following her retirement warrants monitoring for policy continuity (ESG, privacy, risk governance) and any changes in compensation metrics mix or performance rigor post‑transition.