Directors Who Fail To Obtain A Majority Vote | Interfaith Center on Corporate Responsibility

<div class=”col-lg-9 content-page left-side”>
<section class=”section-a-single-resolutions resolutions-info top-content”>
<div class=”resolutions-contain”>
<div class=”top-content”>
<h4>Resolution Details</h4>
</div>
<div class=”bottom-content”>
<div class=”row-info”>
<strong>Company:</strong>
<p>Advance Auto Parts, Inc.</p>
</div>
<div class=”row-info”>
<strong>Year:</strong>
<p>2026 </p>
</div>
<div class=”row-info”>
<strong>Issue Area:</strong>
<p>Corporate Governance </p>
</div>

<div class=”row-info”>
<strong>Focus Area:</strong>
<p>Majority Vote </p>
</div>
<div class=”row-info”>
<strong>Status:</strong>
<p>Filed</p>
</div>

</a>
</div>
</div>
</div>
</section>

<section class=”section-b-single-resolutions content-blocks”>
<div class=”top-content editor-block”>
<div class=”content-block”>
<div class=”main-content”>
<h2>Resolution Text</h2>
<p><strong>RESOLVED</strong>: Shareholders request that the Board of Directors take the necessary steps to ensure that directors who fail to obtain a majority vote in a future uncontested shall leave the board as soon as possible but in no case shall such directors serve more than 9-months on the Board after such failed election.</p>
<p><strong>SUPPORTING STATEMENT</strong>: </p>
<p dir=”ltr”>A vote of rejection by Advance Auto Parts shareholders needs to be respected. AAP shareholders often only vote on 3 Company items a year. The least that AAP can do is to respect all shareholder votes. If AAP accepts shareholder approval of its executive pay then AAP should be prepared to accept shareholder rejection of a director.</p>
<p dir=”ltr”>9-months is adequate time for AAP to find a highly qualified replacement director. This proposal will give AAP directors more of an incentive to perform.</p>
<p dir=”ltr”>Now is a good time to improve shareholder oversight of AAP. AAP stock was at $244 in 2022 and was only at $51 in late 2025 despite a robust stock market. </p>
<p dir=”ltr”>AAP faces challenges and AAP shareholders may believe that board refreshment is a way to address challenges. AAP shareholder efforts at board refreshment could be thwarted if AAP can ignore AAP shareholders when shareholders reject a director.</p>
<p dir=”ltr”>These are some of the challenges facing AAP:</p>
<p dir=”ltr”>As part of its restructuring plan, AAP moved to close more than 700 locations (approximately 500 corporate stores and 200 independent locations) by mid-2025 to improve finances and focus on core operations. This included an exit from five Western states entirely.</p>
<p dir=”ltr”><br>In August 2025, AAP lowered its adjusted earnings-per-share (EPS) guidance for the year, a move that contributed to a stock price drop. The revised outlook accounted for higher net interest expenses from newly acquired debt.</p>
<p dir=”ltr”><br>AAP continued to report negative free cash flow through the second quarter of 2025, a significant concern for shareholders as it was 4-times worse than the prior year’s period.</p>
<p dir=”ltr”><br>AAP’s stock experienced volatility and faced analyst downgrades and a high level of short interest, reflecting persistent investor skepticism about the pace and success of its turnaround plan despite some incremental progress. Analysts expressed expressed concern about the loss of market share to competitors like O’Reilly Auto Parts and AutoZone.</p>
<p dir=”ltr”><br>A lawsuit related to a 2024 data breach was settled in July 2025, potentially involving sensitive employee and applicant information. </p>

</div>
</div>
</div>
<div class=”middle-content editor-block”>
<div class=”content-block”>
<div class=”main-content”>

</div>
</div>
</div>

</section>
</div>
<aside class=”col-xl-3 right-side”>
<div class=”column-contain”>

<h3>Lead Filer</h3>
<div class=”views-row”>
<div class=”views-field views-field-nothing”><span class=”field-content”> John Chevedden</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>Chevedden Corporate Governance</span></div>
</div>

</div>

</div>
</div>

</div>
</div>
</aside&gt