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Item 9A. Controls and Procedures

2022-03-24 compared with 2021-04-05 · 46 added, 1158 removed, 100 unchanged (92% of the section changed)

4 unchanged sentences

Based upon this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of January 29, 2022.

Management’s Annual Report on Internal Control Over Financial Reporting

This Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of the Company’s independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

Changes in Internal Control over Financial Reporting

This Annual Report on Form 10-K does not include disclosure of changes in internal control over financial reporting due to a transition period established by rules of the SEC for newly public companies.

Limitations on the Effectiveness of Controls

3 unchanged sentences

Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

Management’s Annual Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) of the 1934 Act.

Management has assessed the effectiveness of our internal control over financial reporting as of January 29, 2022 based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

As a result of this assessment, management concluded that, as of January 29, 2022, we maintained effective internal control over financial reporting .

The effectiveness of our internal control over financial reporting as of January 29, 2022 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report that appears under Part II, Item 8 of this Annual Report on Form 10-K.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the fourth quarter of fiscal 2021 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Other Information.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

Directors, Executive Officers and Corporate Governance.

Information Regarding Executive Officers

Set forth below are the names, ages, positions and biographies of our executive officers as of the date of this Annual Report on Form 10-K:

Ronald Coughlin, Jr.

, 54, has served as our Chief Executive Officer since June 2018.

He was also appointed to serve as the Chairman of our board of directors in January 2021 in connection with our initial public offering.

Prior to that time, he served as one of our directors since June 2018.

Prior to joining us, Mr.

Coughlin served from 2014 to 2018 as President of the Personal Systems segment of HP Inc.

(then-Hewlett-Packard Company), a $33 billion global business that offers consumer and commercial products and services.

Previously, he served as Senior Vice President of Consumer PCs, Senior Vice President of LaserJet Hardware and Commercial Document Services and Solutions, and Senior Vice President of Sales, Strategy, and Marketing at HP Inc.

Prior to joining HP Inc.

Coughlin spent 13 years at PepsiCo in a range of senior executive roles, including Chief Marketing Officer of PepsiCo International Beverages.

Coughlin earned a bachelor’s degree in international marketing from Lehigh University and a master’s degree in business administration from the Kellogg School of Management at Northwestern University.

Michael Nuzzo , 50, has served as our Executive Vice President, Chief Financial Officer since May 2015, and as our Chief Operating Officer and President of our services businesses since July 2019.

Prior to joining us, Mr.

Nuzzo served from July 2014 to April 2015 as Chief Administrative Officer at 4moms, a technology and robotics startup company.

Prior to joining 4moms, Mr.

Nuzzo served as the Executive Vice President and Chief Financial Officer for GNC Holdings, Inc., a multinational health and nutrition retailer, from 2008 to 2014, playing a lead role in the company’s initial public offering in 2011.

From 1999 to September 2008, Mr.

Nuzzo served in various senior level finance, retail operations, and strategic planning roles with Abercrombie & Fitch, a specialty retailer of casual clothing for men, women, and children, including Senior Vice President of Corporate Finance from June 2008 to September 2008 and Vice President of Corporate Finance from January 2006 to May 2008.

Prior to his work in the retail sector, Mr.

Nuzzo was a senior consultant in the healthcare industry with William M.

Mercer and Medimetrix Group.

Nuzzo holds a bachelor’s degree in economics from Kenyon College and a master’s degree in finance and accounting from the University of Chicago.

Michelle Bonfilio , 50, has served as our Chief Human Resources Officer since October 2018.

Prior to joining us, Ms.

Bonfilio served from April 2017 to October 2018 as Chief Human Resources Officer for The Wine Group, LLC, the second-largest global producer of wine in the United States.

Previously, from January 2016 to April 2017 she served as Vice President, Human Resources at Delta Dental of California, a dental insurance company, and from August 2014 to August 2015 as Vice President, Human Resources at Big Heart Pet Brands.

She also held various HR leadership positions at Gap, Inc., a worldwide clothing and accessories retailer, from January 2005 to July 2014.

Bonfilio holds a bachelor’s degree in psychology from the University of California, Davis.

Ilene Eskenazi , 49, has served as our Chief Legal Officer and Corporate Secretary since September 2020.

Prior to joining us, Ms.

Eskenazi served from 2016 to 2020 as Global General Counsel and Chief Human Resources Officer at Boardriders, Inc.

(formerly Quiksilver, Inc.), a leading action sports and lifestyle company.

Previously, she served from 2013 to 2016 as Chief Legal Officer and Senior Vice President of Talent Operations and Performance at True Religion Apparel, Inc., an apparel and retail company.

True Religion subsequently filed for Chapter 11 bankruptcy in July 2017, which it exited four months later.

Before that, Ms.

Eskenazi served as the General Counsel for Red Bull North America, Inc.

between 2008 and 2013 and as the Deputy General Counsel at The Wonderful Company between 2002 and 2008.

Eskenazi started her legal career at Skadden, Arps, Slate, Meagher and Flom LLP.

Eskenazi holds a bachelor’s degree in philosophy from the University of Michigan and a J.D.

from the University of California, Los Angeles School of Law.

Tariq Hassan , 51, has served as our Chief Marketing Officer since July 2018.

Prior to joining us, Mr.

Hassan served from 2015 to 2017 as head of brand for Bank of America, a multinational investment bank and financial services holding company.

Prior to that, he held global leadership roles with HP Inc.

(then-Hewlett-Packard Company), a leading global provider of personal computing and other access devices, imaging, and printing products, and related technologies, solutions and services, between 2008 and 2012, and global executive management roles with Omnicom Group, Inc., a global marketing, media, and corporate communications holding company, between 2001 and 2008 and then again between 2012 and 2014.

Hassan holds an honors bachelor’s degree in international political science and philosophy from the University of Western Ontario and a master’s degree in integrated marketing communications from Northwestern University.

Nicholas Konat , 43, has served as our Chief Merchandising Officer since September 2018.

He joined us in 2015 as Vice President of Owned Brands, leading product innovation and design before being promoted to Senior Vice President of Owned Brands and Merchandising.

Prior to joining us, Mr.

Konat served as Director of Food and Merchandising Planning at Target Corporation, capping a more than 9 year career there where he held a range of merchandising, planning and leadership roles across the food and fashion categories.

Konat also spent six years with Accenture plc, a multinational professional services company.

Konat holds an honors bachelor’s degree in political science and government from St.

John’s University.

Darren MacDonald , 43, has served as our Chief Digital & Innovation Officer since June 2019.

Prior to joining us, Mr.

MacDonald served from February 2016 to January 2017 as Senior Vice President of Jet.com, a then e-commerce company, and from January 2017 to June 2019 as Group General Manager and Global Officer for U.S.

at Walmart Inc., a multinational retail corporation.

Prior to that, between April 2014 and February 2016, he was the Founder and CEO of Ingress Capital.

Previously, he was the CEO of The Pronto Network, an IAC company, and also held a number of roles at Avery Dennison Corporation.

MacDonald holds a bachelor’s degree from the University of California, Berkeley and a master’s degree in business administration from the University of California, Los Angeles.

Justin Tichy , 49, has served as our Chief Pet Care Center Officer since October 2018.

Prior to joining us, Mr.

Tichy served from May 2015 to October 2018 as President of Sales at Confie, one of the largest privately held insurance brokers in the United States.

Previously, he held key leadership positions at Best Buy Co., Inc., Target Corp., and Walmart Inc.

Tichy holds a bachelor’s degree in business management from Pennsylvania State University and a master’s degree in organizational management from the University of Phoenix.

John Zavada , 58, has served as our Chief Information & Administrative Officer since September 2016.

Prior to joining us, Mr.

Zavada served from 2013 to 2016 as Senior Vice President and Chief Information Officer at Restoration Hardware, a luxury home-furnishings company.

Previously, he filled Chief Information Officer roles at Guitar Center, Big Lots, Inc., Gottschalks Department Stores, and Victoria’s Secret Stores.

Zavada holds a bachelor’s degree in business information systems from California State Polytechnic University.

Information Regarding Our Directors

Set forth below are the names, ages and biographies of our directors as of the date of this Annual Report on Form 10-K:

Maximilian Biagosch , 48, has served as a member of our board of directors since 2018.

Biagosch is a Managing Director at CPP Investments, one of our Sponsors, which he joined in 2015.

Between 2007 and 2015, Mr.

Biagosch worked at Permira Advisers LLP, an international investment firm, where he was the head of Permira’s Capital Markets Group.

Prior to Permira Advisers LLP, Mr.

Biagosch worked in investment banking at Deutsche Bank and at BNP Paribas.

Biagosch received a Master of Laws (LLM) from Ludwig-Maximilians-Universität Munich.

His experience across multiple industries and with portfolio company operational performance improvement qualifies him to serve on our board of directors.

Cameron Breitner , 46, has served as a member of our board of directors since 2016.

He is a Managing Partner at CVC, the private equity and investment advisory firm that advises and manages CVC Funds, one of our Sponsors, which he joined in 2007.

He is the head of CVC’s San Francisco office and shares responsibility for overseeing CVC’s U.S.

Private Equity activities.

Prior to joining CVC, Mr.

Breitner was a Managing Director at Centre Partners, a private equity firm, where he worked from 1998 to 2007.

Prior to Centre Partners, he worked in mergers and acquisitions at Bowles Hollowell Conner & Co.

Breitner also serves on the board of directors of Advantage Solutions Inc., a leading business solutions provider to consumer goods manufacturers and retailers.

Breitner has previously served on the board of directors of BJ’s Wholesale Club Holdings, Inc.

and many other public and private companies.

Breitner received a bachelor’s degree in psychology from Duke University.

His retail industry experience qualifies him to serve on our board of directors.

Gary Briggs , 58, has served as a member of our board of directors since 2018.

Since 2019, he has served as the Chairman at Hawkfish, a data and technology firm.

He also serves on the board of directors of Etsy and Afterpay.

Previously, between 2013 and 2018, Mr.

Briggs served as the Chief Marketing Officer of Facebook, Inc.

Prior to joining Facebook, he served in various leadership roles at Google Inc.

Before then, he held a number of marketing and general management leadership roles at eBay Inc., PayPal, Inc., PepsiCo, Inc., and IBM Corp.

Earlier in his career, he was a management consultant with McKinsey and Company.

He holds a bachelor’s degree from Brown University and a master’s degree from the Kellogg School of Management at Northwestern University.

His extensive experience in marketing and brand management qualifies him to serve on our board of directors.

Nishad Chande , 45, has served as a member of our board of directors since 2016.

He is a Senior Managing Director, U.S.

Head of Consumer and Co-Head of Business Services at CVC, the private equity and investment advisory firm that advises and manages CVC Funds, one of our Sponsors, which he joined in 2016.

Prior to joining CVC, he worked at Centre Partners, a private equity firm, from 2005 to 2016, Bain & Company from 2003 to 2005, Raymond James Capital from 1999 to 2001, and Schroders from 1997 to 1999.

Chande previously served on the board of directors of BJ’s Wholesale Club Holdings, Inc.

Chande holds a bachelor’s degree in economics and mathematics from Dartmouth College and a master’s in business administration degree from the Wharton School at the University of Pennsylvania.

His experience across multiple industries qualifies him to serve on our board of directors.

Christy Lake , 47, has served as a member of our board of directors since 2018.

Since April 2020 she has served as the Chief People Officer at Twilio, a cloud communications platform.

Previously, between 2018 and 2020, Ms.

Lake served as Senior Vice President and Chief People Officer at Box, Inc., an internet company.

Prior to Box, Ms.

Lake worked at Medallia, serving as VP of People and Culture from 2016 to 2018 and VP of HRBP & HR Operations in 2016.

Lake also served as Global Head of HR for HP Inc.’s Personal Systems division from 2015 to 2016 and has held additional HR positions at HP Inc.

and The Home Depot, among other companies.

Lake holds a bachelor’s degree in political science from the University of Connecticut.

Her experience in leadership across various industries qualifies her to serve on our board of directors.

Michael (Mike) Mohan , 53, has served as a member of our board of directors since 2021.

Since June 2019, Mr.

Mohan has served as the President and Chief Operating Officer of Best Buy Co., Inc.

(“Best Buy”), a multinational consumer electronics retailer.

Prior to his current role, he served in the following roles at Best Buy:

Chief Operating Officer, U.S., from September 2018 until June 2019;

Senior Executive Vice President and Chief Merchandising and Marketing Officer from 2017 until September 2018;

Chief Merchandising Officer from 2014 to 2017;

President, Home, from 2013 to 2014;

Senior Vice President, General Manager - Home Business Group, from 2011 to 2013;

Senior Vice President, Home Theatre, from 2008 to 2011;

and Vice President, Home Entertainment, from 2006 to 2008.

Prior to joining Best Buy in 2004 as Vice President, Digital Imaging, Mr.

Mohan was Vice President and General Merchandising Manager for Good Guys, an audio/video specialty retailer in the western U.S.

Mohan also previously worked at Future Shop in Canada from 1988 to 1997, prior to Best Buy’s acquisition of the company, where he served in various merchandising roles.

Mohan also serves on the board of directors of Bloomin’ Brands, Inc., a hospitality industry company that owns several American casual dining restaurant chains, and as a national trustee for the Boys & Girls Clubs of America.

His extensive retail industry and management experience, coupled with his digital marketing acumen, qualifies him to serve on our board of directors.

Jennifer Pereira , 38, has served as a member of our board of directors since 2016.

She is a Senior Principal at CPP Investments, one of our Sponsors, which she joined in 2011 and where she currently leads consumer and retail private equity efforts in North America.

Prior to joining CPP Investments, Ms.

Pereira worked at the Boston Consulting Group from 2006 to 2009.

Pereira also serves on the board of directors of Ultimate Kronos Group and as an observer on the board of directors of Merlin Entertainments Ltd.

She holds a bachelor’s degree in engineering from the University of Toronto and a master’s degree in business administration from the Wharton School at the University of Pennsylvania.

Her experience in private equity investing and the consumer and retail industries qualifies her to serve on our board of directors.

Sabrina Simmons , 57, has served as a member of our board of directors since 2021.

She served as Executive Vice President and Chief Financial Officer of Gap, Inc., a worldwide clothing and accessories retailer, from January 2008 to February 2017.

Previously, Ms.

Simmons also served in the following positions at Gap, Inc.:

Executive Vice President, Corporate Finance from September 2007 to January 2008;

Senior Vice President, Corporate Finance and Treasurer from March 2003 to September 2007;

and Vice President and Treasurer from September 2001 to March 2003.

Prior to that, Ms.

Simmons served as Chief Financial Officer and an executive member of the board of directors of Sygen International plc, a British genetics company, and was Assistant Treasurer at Levi Strauss & Co., a clothing company.

Simmons also serves on the board of directors of Columbia Sportswear Company, as well as the board of directors and audit committee of each of Coursera, Inc., Williams-Sonoma, Inc., and e.l.f.

On March 26, 2021, Ms.

Simmons notified e.l.f.

that she will resign from its board of directors effective as of May 31, 2021.

She holds a bachelor’s degree in business administration from the University of California, Berkeley and a master’s degree in business administration from the Anderson School at the University of California, Los Angeles.

Her public company, global retail and financial experience qualifies her to serve on our board of directors.

Christopher J.

Stadler , 56, has served as a member of our board of directors since 2016.

He is a Managing Partner at CVC, the private equity and investment advisory firm that advises and manages CVC Funds, one of our Sponsors, which he joined in 2007.

Stadler is on the board of the CVC Capital Partners advisory business and is the Co-Chairman of the Europe/North America Private Equity Board.

Prior to joining CVC, he worked for Investcorp as Head of Private Equity, North America after joining as Managing Director in 1996.

Stadler previously served on the board of directors of BJ’s Wholesale Club Holdings, Inc.

He holds a bachelor’s degree in economics from Drew University and a master’s degree in business administration from Columbia University.

His experience across multiple industries qualifies him to serve on our board of directors.

Mary Sullivan , 57, has served as a member of our board of directors since 2021.

Sullivan is Senior Managing Director & Chief Talent Officer at CPP Investments, one of our Sponsors, which she joined in 2015 and where she currently is responsible for talent acquisition, organizational development, international mobility, compensation and benefits, facilities and office services, and inclusion and diversity.

Prior to joining CPP Investments, Ms.

Sullivan was Senior Vice President, People at Holt, Renfrew & Co., a Canadian luxury department store chain, from 2014 to 2015, where she was responsible for the Human Resources function.

From 2007 to 2014, she worked at Four Seasons Hotels and Resorts, ending her career at the firm in the role of Senior Vice President, Corporate Human Resources.

She also spent seven years as a leader of the Human Resources function at IMAX Corporation, ending as Senior Vice President of Human Resources.

Sullivan holds a bachelor’s degree in administrative and commercial studies from the University of Western Ontario and a master’s degree in business administration from the Rotman School of Management at the University of Toronto.

Her experience in leadership roles across the retail and hospitality industries qualifies her to serve on our board of directors.

Stockholder’s Agreement

In connection with our initial public offering, we entered into a stockholder’s agreement with our Principal Stockholder, which provides our Principal Stockholder with the right to designate a certain number of nominees for election to our board of directors and with certain committee nomination and observer rights.

Specifically, pursuant to the stockholder’s agreement, so long as our Principal Stockholder (including its permitted transferees under the stockholder’s agreement) has sold, in the aggregate, (i) 50% or less of the total outstanding shares of Class A Common Stock and Class B-1 Common Stock beneficially owned (directly or indirectly) by it upon the completion of our initial public offering, it is entitled to nominate six directors, (ii) more than 50% but less than or equal to 75% of such shares, it is entitled to nominate four directors, (iii) more than 75% but less than or equal to 90% of such shares, it is entitled to nominate two directors, and (iv) more than 90% of such shares, it is not entitled to nominate any directors.

If, with the Principal Stockholder’s prior written consent, the size of the board of directors is decreased, the Principal Stockholder is entitled to designate the same number of persons for nomination and election to our board of directors as set forth above.

If, with the Principal Stockholder’s prior written consent, the size of board of directors is increased beyond 11 directors, our Principal Stockholder is entitled to designate a proportional number of persons for nomination and election to our board of directors (rounded up to the nearest whole, even number).

In addition, subject to any requirements, including independence requirements, for committee members imposed by applicable law or by the applicable rules of any national securities exchange on which our Class A common stock may be listed or traded, our Principal Stockholder has the right to have two of its nominees appointed to serve on each committee of the board of directors for so long as our Principal Stockholder has the right to designate at least two directors for nomination and election to the board.

Our Principal Stockholder is also entitled to designate at least four non-voting observers to attend all meetings of the board of directors and its committees as long as our Principal Stockholder has nomination rights under the Stockholder’s Agreement.

For additional details, please see “Item 13.

Certain Relationships and Related Transactions, and Director Independence—Related Person Transactions—Stockholder’s Agreement” below.

The Principal Stockholder has nominated Christopher J.

Stadler, Cameron Breitner, and Nishad Chande as designees of CVC, and Jennifer Pereira, Maximilian Biagosch, and Mary Sullivan as designees of CPP Investments, for election to our board of directors.

Status as a Controlled Company

Because our Sponsors control approximately 79.1% of the voting power with respect to director elections, we are a “controlled company” under the Nasdaq rules.

A controlled company is not required to have a majority of independent directors or form an independent compensation or nominating and corporate governance committee.

As a controlled company, we remain subject to rules that require us to have an audit committee composed entirely of independent directors, subject to the “phase-in” rules applicable to newly public companies.

Under the “phase in”

rules, we must have at least three independent directors on our audit committee within one year of the effectiveness of the registration statement on Form S-1 (File No.

333-251107) that was filed in connection with our initial public offering ( as amended, the “Form S-1”).

If at any time we cease to be a controlled company, we will take all action necessary to comply with SEC rules and regulations and the Nasdaq rules, including appointing a majority of independent directors to our board of directors and ensuring that we have a compensation committee and a nominating and corporate governance committee each composed entirely of independent directors, subject to the permitted “phase-in” periods.

Committees of the Board of Directors

In connection with our initial public offering, our board of directors established an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee.

These committees are each described below.

Each of the board’s committees acts under a written charter, which was adopted and approved by our board of directors.

Copies of the committees’ charters are available on our website at ir.petco.com/corporate-governance/documents-and-charters.

Audit Committee

Sabrina Simmons, Maximilian Biagosch, and R.

Michael Mohan are members of the Audit Committee.

Simmons serves as the chair of the Audit Committee.

We are relying on the phase-in rules of the SEC and Nasdaq with respect to the independence of our Audit Committee.

These rules permit us to have an Audit Committee that has one member that is independent as of the effectiveness of the Form S-1, a majority of members that are independent within 90 days of the effectiveness of the Form S-1, and all members that are independent within one year of the effectiveness of the Form S-1.

Michael Mohan and Sabrina Simmons qualify as an “independent” director for purposes of the SEC and Nasdaq independence rules that are applicable to audit committee members.

Sabrina Simmons also qualifies as an “audit committee financial expert” as defined by the SEC rules.

Our board of directors has considered Ms.

Simmons’ temporary service on the audit committees of three other public companies until her resignation from e.l.f.

on May 31, 2021, and has determined that such simultaneous service does not impair her ability to effectively serve as a member of our Audit Committee.

Under its charter, our Audit Committee, among other things, has responsibility for:

assisting our board of directors in its oversight responsibilities regarding the integrity of our financial statements, our compliance with legal and regulatory requirements, the independent accountant’s qualifications and independence, and our accounting and financial reporting processes of and the audits of our financial statements;

preparing the report required by the SEC for inclusion in our annual proxy or information statement;

approving audit and non-audit services to be performed by the independent accountants;

performing such other functions as our board of directors may from time to time assign to the committee.

Compensation Committee

Christy Lake, Maximilian Biagosch, and Cameron Breitner are members of the Compensation Committee.

Cameron Breitner serves as the chair of the Compensation Committee.

As a controlled company, we rely upon the exemption from the Nasdaq requirement that we have a compensation committee composed entirely of independent directors.

Under its charter, our Compensation Committee, among other things, has responsibility for:

reviewing and approving the compensation and benefits of our Chief Executive Officer and other executive officers, or recommending such compensation for approval by our board of directors, as applicable;

recommending the amount and form of non-employee director compensation;

appointing and overseeing the work performed by any compensation consultant;

overseeing our strategies and policies related to human capital management, including with respect to matters such as diversity and inclusion, workplace environment and culture, and talent development and retention;

performing such other functions as our board of directors may from time to time assign to the committee.

Nominating and Corporate Governance Committee

Mary Sullivan, Cameron Breitner, and Gary Briggs are members of the Nominating and Corporate Governance Committee.

Gary Briggs serves as the chair of the Nominating and Corporate Governance Committee.

As a controlled company, we rely upon the exemption from the Nasdaq requirement that we have a nominating and corporate governance committee composed entirely of independent directors.

Under its charter, our Nominating and Corporate Governance Committee, among other things, has responsibility for:

identifying individuals qualified to become members of our board of directors, consistent with criteria approved by our board of directors;

engaging in succession planning for the board of directors;

recommending to our board of directors Petco’s director candidates for election at the annual meeting of stockholders;

developing and recommending to our board of directors a set of corporate governance guidelines and principles;

overseeing and, where appropriate, making recommendations to our board of directors regarding sustainability matters relevant to Petco’s business;

performing a leadership role in shaping our corporate governance;

performing such other functions as our board of directors may from time to time assign to the committee.

Code of Business Conduct and Ethics

In connection with our initial public offering, we adopted a Code of Business Conduct and Ethics relating to the conduct of our business by all of our employees, executive officers (including our principal executive officer and principal financial officer/ principal accounting officer (or persons performing similar functions)), and directors.

This code satisfies the requirement that we have a “code of conduct” under the Nasdaq and SEC rules and is available on our website at ir.petco.com/corporate-governance/documents-and-charters.

To the extent required under the listing rules and SEC rules, we intend to disclose future amendments to certain provisions of this code, or waivers of such provisions, applicable to any of our executive officers or directors, on our website identified above.

Procedures for Recommending Individuals to Serve as Directors

Any stockholder who wishes to propose director nominees for consideration by our Nominating and Corporate Governance Committee, but does not wish to present such proposal at an annual meeting of stockholders, may do so at any time by directing a description of each nominee’s name and qualifications for board membership to the chair of the Nominating and Corporate Governance Committee, c/o our Corporate Secretary, at 10850 Via Frontera, San Diego, California 92127.

The recommendation should contain all of the information regarding the nominee required under the “advance notice” provisions of our bylaws (which can be provided free of charge upon request by writing to the Corporate Secretary at the address listed above).

The Nominating and Corporate Governance Committee evaluates nominee proposals submitted by stockholders in the same manner in which it evaluates other director nominees.

Corporate Governance Guidelines

In connection with our initial public offering, we adopted corporate governance guidelines, which serve as a flexible framework within which our board of directors and its committees operate.

These guidelines cover a number of areas, including the role of our board of directors, board composition and leadership structure, director

independence, director selection, qualification and election, director compensation, executive sessions, CEO evaluation, succession planning, annual board assessments, board committees, director orientation and continuing education, board communication with stockholders and others.

A copy of our corporate governance guidelines are available on our website at ir.petco.com/corporate-governance/documents-and-charters.

Information responsive to this item is incorporated herein by reference to our definitive proxy statement with respect to our 2022 annual meeting of stockholders to be filed with the SEC within 120 days after the end of our fiscal year covered by this Annual Report on Form 10-K.

Executive Compensation.

Compensation Discussion and Analysis

This Compensation Discussion and Analysis, or CD&A, provides an overview of our executive compensation philosophy, objectives, and design and each element of our executive compensation program with regard to the compensation awarded to, earned by, or paid to our named executive officers (our “NEOs”), during fiscal 2020, as well as certain changes we have made to our executive compensation program since the end of fiscal 2020.

Our NEOs are employed by our subsidiary, Petco Animals Supplies Stores, Inc.

For fiscal 2020, our NEOs were:

Ronald Coughlin, Jr.

Chief Executive Officer

Michael Nuzzo

Executive Vice President, Chief Financial Officer and Chief Operating Officer

Darren MacDonald

Chief Digital & Innovation Officer

Chief Pet Care Center Officer

Ilene Eskenazi

Chief Legal Officer and Corporate Secretary (1)

Eskenazi was appointed as our Chief Legal Officer and Corporate Secretary effective September 14, 2020.

Principal Objectives of Our Compensation Program for Named Executive Officers

Our executive team is critical to our success and to building value for our stockholders.

Our executive compensation program is designed to attract and retain highly skilled, performance-oriented executives who thrive in a culture focused on delivering purpose-driven results.

We incentivize our senior leaders to deliver the highest levels of execution and business results, while also delivering on our mission of improving lives for pets, pet parents and our employees, who we refer to as our partners.

We carry out these objectives through the following attributes of our executive compensation program:

We align executive compensation with achievement of operational and financial results, increases in stockholder value, and delivering on our mission.

A significant portion of total compensation for our executives is at-risk and is subject to short-term and long-term incentive programs that are designed to align their interests with those of our stockholders.

We evaluate the competitiveness and effectiveness of our compensation programs against other comparable businesses based on industry, size, and other relevant criteria in making pay decisions.

Total compensation for individual executives is influenced by a variety of factors, including each executive’s scope of responsibility, individual performance, skill set, experience, and expected future contributions.

We focus on creating simple, straightforward compensation programs that our partners and stockholders can easily understand.

Process for Setting Executive Compensation

Role of our Compensation Committee and Management in Compensation Decisions

As described below, the primary elements of our executive compensation program are annual base salary, annual short-term cash incentives, long-term equity incentives, retirement benefits, and severance benefits.

Together, these items are intended to be complementary and serve the goals described above.

Our executive compensation program is developed and overseen by the Compensation Committee.

The purpose of the Compensation Committee is to assist our board of directors in discharging its responsibilities relating

to the compensation of our executive officers and directors, including by overseeing Petco’s overall compensation, philosophy, policies, and programs, evaluating the compensation and performance of our executive officers, reviewing, approving, and modifying the terms of our compensation and benefit p l ans and programs as appropriate.

Subject in certain circumstances to approval by our board of directors, the Compensation Committee has the sole authority to make final decisions with respect to our executive compensation program.

For more information regarding the authority and responsibilities of the Compensation Committee, please refer to the Compensation Committee Charter, which is available via Petco’s Investor Relations website at ir.petco.com/investor-relations by selecting “Governance” and then “Documents & Charters.”

In making decisions regarding the allocation of compensation between short-term and long-term compensation, between cash and non-cash compensation, and among different forms of cash and non-cash compensation, the Compensation Committee took into account the views and recommendations of management, in particular our Chief Executive Officer, or our CEO (except with respect to his own compensation).

Our CEO made recommendations about annual base salary increases, annual short-term incentive targets and long-term equity grants for our NEOs using market data and internal equity alignment while working within the parameters of our annual budget for base salary increases and the size of the equity pool.

Use of Compensation Consultants

During fiscal 2020, the Compensation Committee engaged Exequity as its independent compensation consultant.

Exequity assisted the Compensation Committee in designing the executive compensation program in connection with our initial public offering, which included the establishment of our 2020 Peer Group (as defined below), a review and analysis of our executive compensation levels and practices relative to the 2020 Peer Group, remuneration of members of our board of directors, executive officer and non-employee director ownership guidelines, and long-term incentive plan design and grant practices.

After taking into consideration the factors listed in Nasdaq Listing Rule 5605(d)(3)(D), the Compensation Committee concluded that there are no conflicts of interest with respect to the engagement of Exequity by the Compensation Committee.

2020 Peer Group

In October 2020, the Compensation Committee, with the assistance of Exequity, selected a peer group of companies in similar size and with whom we may compete for talent to inform our compensation decisions (the “2020 Peer Group”).

In determining appropriate compensation opportunities for our NEOs, the Compensation Committee reviewed competitive market data provided by Exequity regarding the compensation practices of our 2020 Peer Group.

The following 16 companies comprised our 2020 Peer Group:

The Aaron’s Company, Inc.

National Vision Holdings, Inc.

Advance Auto Parts, Inc.

PriceSmart, Inc.

American Eagle Outfitters, Inc.

Casey’s General Stores, Inc.

Sally Beauty Holdings, Inc.

Central Garden & Pet Company

Sprouts Farmers Market, Inc.

DICK’s Sporting Goods, Inc.

Tractor Supply Company

Foot Locker, Inc.

Ulta Beauty, Inc.

The Michaels Companies, Inc.

Williams-Sonoma, Inc.

Internal Pay Equity and Other Factors

In setting base salary, annual short-term cash incentives and long-term equity incentives, our board of directors, in collaboration with the CEO, has considered factors such as internal pay equity, the experience and length of service of the executive, relative responsibilities among members of our executive team, individual contributions by the executive, and business conditions.

In addition, our board of directors has also historically relied on the experience of its Sponsor-affiliated members who consider the compensation of our executive team in light of the compensation structure of other portfolio companies or private equity-backed companies in general, which typically favors a higher emphasis on long-term incentive compensation due to the nature of such businesses and their ownership.

For elements of compensation other than total direct compensation, such as severance and change in control benefits, our board of directors has relied on its own business experience and familiarity with market conditions in determining the appropriate level of protections for our NEOs.

Elements of Compensation

The main components of our executive compensation during fiscal 2020 included base salary, an annual cash incentive, long-term equity incentive awards, and other benefits and perquisites.

We pay our NEOs a base salary to provide them with a fixed, base level of compensation commensurate with the executive’s skill, competencies, experience, contributions, and performance, as well as general review of market compensation.

Base salaries are generally reviewed annually, and the Compensation Committee makes adjustments to reflect individual and Petco performance as well as any survey and peer group data provided at such time.

Our CEO and Chief Human Resources Officer make recommendations to our Compensation Committee regarding base salary adjustments for our NEOs (except with respect to their own salaries).

These recommendations are generally based upon the executive’s individual contributions to Petco for the prior fiscal year, leadership and contribution to Petco performance, internal pay considerations, market conditions and survey data, and our overall budget for base salary increases for Petco partners generally.

Our Compensation Committee takes all of these factors into account when making its decisions on base salaries but does not assign any specific weight to any one factor.

In addition to the annual base salary review, our Compensation Committee may also adjust base salaries at other times during the year in connection with promotions or increased responsibilities or to maintain competitiveness in the market.

In connection with the COVID-19 pandemic and the resulting economic downturn, our executive leaders, including our NEOs, proactively agreed to temporarily receive reduced base salaries in light of the economic uncertainties caused by the pandemic.

Effective April 19, 2020 through May 30, 2020, Mr.

Coughlin agreed to receive no base salary, while all other NEOs agreed to 25% reductions in base salary.

Effective May 31, 2020, base salaries for all NEOs returned to pre-pandemic levels.

In connection with her appointment in September 2020, Ms.

Eskenazi’s base salary was established at $490,000.

Also in September 2020, the Compensation Committee awarded each of the other NEOs a 2.25% base salary increase in accordance with our annual merit cycle.

These base salary increases were consistent with Petco-wide increases provided to all salaried partners based upon Petco’s strong performance through unprecedented times, which was accomplished as one team.

In December 2020, the Compensation Committee awarded an additional pay increase to Messrs.

MacDonald and Tichy to bring their respective base salaries to $600,000, effective upon the consummation of our initial public offering, in order to align total cash compensation and recognize the internal value and contribution currently delivered by Messrs.

MacDonald and Tichy.

Additionally, upon the consummation of our initial public offering and the effectiveness of his amended and restated employment agreement, Mr.

Coughlin’s base salary was further increased to $1,100,000 to recognize his additional duties as Chairman of our board of directors and to align his base salary with market practices based on survey data and our 2020 Peer Group.

The chart below provides the base salary for each of our NEOs as of the end of fiscal 2020.

Base Salary as of

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

Annual Cash Incentive Program

A hallmark of the transformation of our business has been the belief that annual cash incentives should be based upon actual performance measured against specified key business and financial metrics.

These metrics

typically span both company and individual performance.

However, in connection with the COVID-19 pandemic and the extraordinary circumstances and unpredictability resulting from the global economic downturn, the Compensation Committee did not approve an annual incentive plan for fiscal 2020.

Instead, the Compensation Committee determined that it would review operating performance, with a focus on our Adjusted EBITDA (which is a non-GAAP financial measure and is generally calculated consistent with the calculations shown under “Management’s Discussion and Analysis of Financial Condition and Results of Operations— Reconciliation of Non-GAAP Financial Measures to GAAP Measures ” above), and to use its discretion to determine annual incentive payouts for NEOs at the end of f iscal 2020.

Each of our NEOs participates in our Corporate Annual Performance Incentive Plan (the “Bonus Plan”) and is eligible for a target annual cash bonus that is equal to a percentage of his or her annual base salary actually earned (excluding, for fiscal 2020, the impact on earned base salary of the temporary reductions as a result of the COVID-19 pandemic described above), except for Ms.

Eskenazi, whose target annual cash bonus is based on her annualized base salary.

For fiscal 2020, the target annual bonus for each of our NEOs was as follows:

Target Annual Cash

(% of Base Salary)

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

In December 2020, based on the extraordinary efforts of eligible partners to adapt our business practices in light of the COVID-19 pandemic, including implementing store safety practices, remote working, and innovative customer solutions such as BOPUS and same day delivery, the Compensation Committee elected to pay 50% of each eligible partner’s, including each NEO’s, target annual cash incentive amount early given our company’s performance through that date and the broad-based economic impacts of the COVID-19 pandemic.

In February 2021, based on over-performance of several key financial and operational metrics, including revenue and Adjusted EBITDA, the Compensation Committee recommended, and our board of directors approved, a payout factor of 150% resulting in the following annual cash incentive awards under the Bonus Plan (which includes the portion paid in December 2020):

Annual Cash Incentive

Award for 2020

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi (1)

Per the terms of her employment letter, Ms.

Eskenazi was eligible to receive a guaranteed payout of at least $294,000, representing her target annual cash incentive award, for fiscal 2020.

Long-Term Equity Incentive Compensation

Prior to our Initial Public Offering

Prior to our initial public offering, our equity incentive program consisted of grants of Common Series C Units in Scooby LP, our indirect parent (the “C Units”).

This was the primary long-term incentive program prior to our initial public offering.

C Units are intended to qualify as “profits interests” for U.S.

income tax purposes.

The C Units are designed to align the NEOs’ interests with the interests of our equity holders and represent interests in the future profits (once a certain level of proceeds has been generated) in Scooby LP (and its operating entities) .

We historically granted C Units to new executives upon hire, or a short time thereafter, and to our existing executives from time to time.

Scooby LP and our board of directors determined the appropriate number of C Units for each grant by giving consideration to external factors (such as make-whole awards for employees forfeiting compensation opportunities from their prior employers), internal pay equity, retention needs, promotions, and the challenges facing Petco at the time of grant.

Like stock options, the C Units only generate payments to recipients if the value of Petco increases after the C Units are granted.

C Units that were granted in the past, and particularly those granted during

periods of lower company performance , typically have lower Distribution Thresholds (as defined below) and thus the greatest potential opportunity for appreciation.

Company management, including the NEOs, have driven various transformational changes in the business which resulted in accelerated financial and operational performance above expectations.

As a result, these C Units have substantially appreciated in value since the applicable dates of grant .

C Units are granted with a “Distribution Threshold,” which acts similarly to a strike price for a stock option such that the holder will only realize value following returns to investors in excess of such amount.

The Distribution Threshold has traditionally been reviewed and set on a periodic basis in conjunction with an outside valuation.

The C Units granted in fiscal 2020 to Mr.

Tichy and Ms.

Eskenazi were granted with a Distribution Threshold of $0.60 per unit pursuant to an outside valuation, and the C Units granted in fiscal 2020 to Messrs.

Coughlin and Nuzzo were granted with a Distribution Threshold of $1.00 per unit, which was in excess of such outside valuation.

C Units generally vest in equal annual installments over five years following the date of grant or vesting commencement date and are subject to accelerated vesting in connection with a change in control and certain other events, as described under “—Potential Payments Upon Termination or Change in Control—C Units” below.

The C Units remained outstanding following our initial public offering, and no additional C Units have been or will be awarded following our initial public offering.

During fiscal 2020, the following C Unit awards were granted to the NEOs:

C Units Granted (#)

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

Coughlin’s and Mr.

Nuzzo’s awards were granted in recognition for their roles and extra efforts related to the initial public offering and as a way to further align their interests with our stockholders’ interests.

Their grants were offered at a Distribution Threshold higher than other NEOs and significantly in excess of the then-fair market value of Scooby LP as determined by an outside valuation firm.

The grant for Mr.

Tichy was awarded as recognition of strong performance, retention, and internal equity alignment purposes, and the grant to Ms.

Eskenazi was made in connection with her appointment as Chief Legal Officer pursuant to the terms of her employment letter.

Following our Initial Public Offering

Prior to our initial public offering, the Compensation Committee reviewed market data provided by Exequity regarding public company equity plan practices and recommended that our board of directors adopt a broad-based equity incentive plan to align with such market practices.

In light of this recommendation, in connection with the consummation of our initial public offering, our board of directors adopted the Petco Health and Wellness Company, Inc.

2021 Equity Incentive Plan (the “2021 Plan”).

The purpose of the 2021 Plan is to promote and closely align the interests of our partners, officers, non-employee directors, and other service providers and our stockholders by providing stock-based compensation and other performance-based compensation.

The 2021 Plan allows for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), incentive bonuses, and other stock-based awards.

Our board of directors approved equity awards to our NEOs under the 2021 Plan on January 13, 2021 in the form of stock options and time-based RSUs, in each case, which vest as follows:

Award amounts were based on a combination of factors, including the annual equity award levels of similarly situated officers at companies in our 2020 Peer Group, recognition of the tremendous efforts of our NEOs in

completing our initial public offering, and to provide an initial foundation for aligning our NEOs’ interests with the interests of our stockholders through stock ownership.

In addition, the equity awards approved at the time of the public offering contemplate the fact that no annual equity award s are expected be made in fiscal 2021.

Award amounts do not reflect the size of typical annual equity grants expected in the future .

The grant date fair value of these grants for purposes of Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”) are set forth below:

Stock Options ($)

Time-Based RSUs ($)

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

Our board of directors also approved grants of performance-based RSUs (the “EBITDA PSUs”) to Mr.

Coughlin and Mr.

Nuzzo and an additional retention RSU grant to Mr.

Nuzzo on January 13, 2021, in each case, as described in further detail under “Executive Compensation Tables—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements” below.

The Compensation Committee and our board of directors intend to incorporate performance-based constructs into future grants under the 2021 Plan.

Other Benefits and Perquisites

Health and Welfare Benefits

Our NEOs are eligible to participate in our health and welfare plans on the same terms offered to all of our salaried partners, with the exception of life insurance and disability coverage—which is provided at enhanced levels for all partners who serve as Vice Presidents or above.

Retirement Benefits

We have not maintained, and do not currently maintain, a defined benefit pension plan in which our NEOs participate.

All of our NEOs are eligible to participate in our 401(k) plan, which is a broad-based tax-qualified defined contribution retirement plan in which generally all of our partners can participate.

Under the 401(k) plan, we make discretionary matching contributions, including to our NEOs, equal to 100% of the first 1% of an employee’s contributions and 50% on the next 2% of base salary deferred, subject to certain limits under the Code (as defined herein), and partners vest ratably in matching contributions over a period of three years of service.

All of our NEOs are also eligible to participate in our nonqualified deferred compensation plan, which is a non-tax-qualified retirement plan that provides eligible partners with an opportunity to defer a portion of their annual base salary and bonus.

Under the nonqualified deferred compensation plan, we make a discretionary matching contribution of 50% of an eligible partner’s contributions on the first 3% of base salary deferred (or, if the eligible partner is not yet eligible to participate in our 401(k) plan, the first 6% of base salary deferred) and on the first 6% of annual bonus deferred.

The nonqualified deferred compensation plan is described further under “—Nonqualified Deferred Compensation” below.

We believe that our retirement programs serve as an important tool to attract and retain our NEOs and other key partners.

We also believe that offering the ability to create stable retirement benefits encourages our NEOs and other key partners to make a long-term commitment to us.

Severance Benefits under Employment Agreements

We have entered into employment agreements or employment letters with each of our NEOs, which are described in more detail under “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table” and “—Potential Payments Upon Termination or Change in Control—Employment Agreements” below.

The employment agreements and employment letters provide our NEOs with severance protection, which is designed to be fair and competitive in order to aid in attracting and retaining experienced executives.

During fiscal 2020, we provided our NEOs with limited, low cost perquisites, including financial counseling services and wellness exams.

We provide these limited perquisites to ensure our compensation program, as a whole,

remains competitive with companies for which we compete for talent.

In addition, during fiscal 2020, due to security concerns generated from his position with our company, we covered the costs associated with certain security measures at Mr.

Coughlin’s personal residence.

2021 Employee Stock Purchase Plan

In connection with the consummation of our initial public offering, we adopted the Petco Health and Wellness Company, Inc.

2021 Employee Stock Purchase Plan (the “ESPP”).

The purpose of the ESPP is to encourage and enable our eligible partners to acquire a proprietary interest in us through the ownership of our Class A common stock.

The ESPP, and the rights of participants to make purchases thereunder, is intended to qualify under the provisions of Sections 421 and 423 of the Code.

Our NEOs are eligible to participate in the ESPP on the same basis as our other partners.

Other Matters

Tax and Accounting Implications of Executive Compensation Decisions

Historically, we have not previously taken the deductibility limit imposed by Section 162(m) of the Code into consideration in making compensation decisions.

However, as a public company, we may authorize compensation payments that exceed the deductibility limitation under Section 162(m) of the Code when we believe that such payments are appropriate to attract and retain executive talent.

In addition, amounts in excess of the $1 million threshold paid pursuant to our existing employment agreements, employment letters and other arrangements may be nondeductible.

We account for the C Units and equity awards under the 2021 Plan in accordance with the FASB ASC Topic 718, which requires us to estimate the expense of an award over the vesting period applicable to such award.

Risk Assessment

The Compensation Committee does not believe that our executive and non-executive compensation programs encourage excessive or unnecessary risk taking, and any risk inherent in our compensation programs is unlikely to have a material adverse effect on us.

Prohibition on Hedging and Pledging

In connection with our initial public offering, we adopted an Insider Trading Policy pursuant to which, among other things, our directors, officers, and employees, and their respective family members and controlled entities, are prohibited from (i) engaging in speculative transactions (including short sales and puts or calls), (ii) hedging of Petco securities (including through the purchase of financial instruments such as prepaid variable forward contracts, equity swaps, collars and exchange funds), and (iii) pledging Petco securities as collateral for a loan or holding Petco securities in a margin account.

Stock Ownership Guidelines

In connection our initial public offering, we adopted stock ownership guidelines applicable to our NEOs, other officers, and members of our board of directors to create alignment between our officers and directors and our long-term performance, as well as to minimize excess risk taking that might lead to short-term returns at the expense of long-term value creation.

The ownership guidelines were established at the following levels:

Ownership Level

Chief Executive Officer

5x annual base salary

Chief Financial Officer

3x annual base salary

Other NEOs and Officers

2x annual base salary

Independent Directors

5x annual cash retainer

Under the guidelines, the requisite ownership level must be achieved within the later of (i) five years following the consummation of the initial public offering or (ii) five years following the officer or director becoming subject to the stock ownership guidelines.

In determining ownership levels, we include shares of our Class A

common stock owned outright by the officer or director, unvested time-based restricted shares and restricted stock units, vested in-the-money stock options, and shares of our common stock owned by the officer or director through our retirement plan and the ESPP.

Unvested stock options, stock options that are not in-the-money, and unearned performance-based equity are not included in determining ownership levels.

Fiscal 2021 Compensation Decisions

In December 2020, after review of external benchmarking data and the internal pay alignment and scope of responsibilities of our NEOs, the Compensation Committee determined that it was appropriate to increase Mr.

Tichy’s target annual bonus for fiscal 2021 from 60% to 80% of his base salary.

The target annual cash bonuses for the other NEOs as a percentage of base salary remained unchanged for fiscal 2021.

In March 2021, with the assistance of Exequity, the Compensation Committee adopted the Bonus Plan for the 2021 fiscal year to align its annual cash incentive program with market practices of the 2020 Peer Group and public companies in general.

Annual cash incentives under the Bonus Plan for fiscal 2021 will be based on the achievement of Petco, business unit and individual performance goals.

Coughlin and Ms.

Eskenazi, Petco Adjusted EBITDA performance and Petco total revenue performance are each weighted 40%, with individual performance weighted 20%.

Nuzzo, MacDonald and Tichy, Petco Adjusted EBITDA performance and Petco total revenue performance are each weighted 20%, with individual performance also weighted 20%.

Additionally, each of Messrs.

Nuzzo, MacDonald and Tichy have a revenue and gross profits measure, each weighted 20%, specific to their applicable business unit.

Compensation Committee Report

The Compensation Committee has reviewed the Compensation Discussion and Analysis section of this Annual Report on Form 10-K and discussed that section with management.

Based on its review and discussions with management, the Compensation Committee recommended to our board of directors that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K.

This report is provided by the following members of our board of directors, who compose the Compensation Committee:

Cameron Breitner, Chairperson

Maximilian Biagosch

Executive Compensation Tables

Summary Compensation Table

The table below sets forth the compensation earned by our NEOs during fiscal 2020.

Name and Principal

Incentive Plan

Ronald Coughlin, Jr.

Chief Executive Officer

Michael Nuzzo

EVP, Chief Financial Officer and

Chief Operating Officer

Darren MacDonald

Chief Digital & Innovation

Chief Pet Care Center Officer

Ilene Eskenazi (1)

Chief Legal Officer and

Corporate Secretary

Eskenazi was appointed as our Chief Legal Officer and Corporate Secretary effective September 14, 2020.

Amounts in this column include:

(i) under the terms of his employment agreement, Mr.

MacDonald received a $675,000 retention bonus in February 2020, as described in more detail under “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements—Darren MacDonald” below;

(ii) under the terms of his employment letter, Mr.

Tichy was paid the final $12,000 installment of his sign-on bonus, (iii) under the terms of her employment letter, Ms.

Eskenazi was paid a $125,000 sign-on bonus and (iv) each NEO received an annual cash incentive award under the Bonus Plan for fiscal 2020, as described in more detail under “—Compensation Discussion and Analysis—Elements of Compensation—Annual Cash Incentive Program” above, which were paid in part in December 2020 and in part in early 2021.

Amounts in this column represent the aggregate grant date fair value of the C Units, RSUs and EBITDA PSUs granted during fiscal 2020, calculated in accordance with FASB ASC Topic 718.

For additional information regarding the assumptions underlying this calculation please read Note 13 to our consolidated financial statements for the fiscal year ended January 30, 2021.

Amounts in this column represent the aggregate grant date fair value of the stock options granted under the 2021 Plan during fiscal 2020, calculated in accordance with FASB ASC Topic 718.

For additional information regarding the assumptions underlying this calculation please read Note 13 to our consolidated financial statements for the fiscal year ended January 30, 2021.

Amount reflects Mr.

MacDonald’s digital growth award, as described under “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements—Darren MacDonald” below, earned for fiscal 2020.

The digital growth award paid in March 2021, one-half in cash and one-half through the grant of restricted stock under the 2021 Plan that vest as to 50% on each of March 30, 2022 and March 30, 2023.

Amounts reported in the “All Other Compensation” column include (i) matching contributions under our 401(k) plan made during fiscal 2020, (ii) matching contributions under our nonqualified deferred compensation plan made during fiscal 2020, (iii) life insurance premiums paid by us for the benefit of the NEOs, and (iv) additional amounts, each as set forth in the following table:

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

Additional amounts represent (i) for Mr.

Coughlin, a work from home stipend, expenses relating to financial counseling, expenses related to private security benefits, and expenses related to security improvements to his personal residence ($30,945), (ii) for Mr.

Nuzzo, a work from home stipend, and expenses relating to financial counseling benefits, (iii) for Mr.

MacDonald, a work from home stipend, and expenses relating to executive wellness benefits, (iv) for Mr.

Tichy, a work from home stipend, and (v) for Ms.

Eskenazi, a work from home stipend, and bring your own device stipend.

2020 Grants of Plan-Based Awards Table

The following table includes information regarding C Units granted to each NEO and stock options, RSUs and EBITDA PSUs granted to each NEO under the 2021 Plan, in each case, during fiscal 2020.

Estimated Future Payouts

Under Non-Equity Incentive

Estimated Future Payouts

Under Equity Incentive Plan

Ronald Coughlin, Jr.

EBITDA PSUs (3)

Stock Options (5)

Michael Nuzzo

EBITDA PSUs (3)

Stock Options (5)

Darren MacDonald

Digital Growth Award (7)

Stock Options (5)

Ilene Eskenazi

Stock Options (5)

Amounts in this column represent the aggregate grant date fair value of the C Units, stock options, RSUs, and EBITDA PSUs granted during fiscal 2020, calculated in accordance with FASB ASC Topic 718.

For additional information regarding the assumptions underlying this calculation please read Note 13 to our consolidated financial statements for the fiscal year ended January 30, 2021.

Please read “—Compensation Discussion and Analysis—Elements of Compensation—Long-Term Equity Incentive Compensation” above for more information regarding these grants.

C Units granted during fiscal 2020 vest in equal annual increments over five years following the date of grant (for Messrs.

Nuzzo and Tichy and Ms.

Eskenazi) or specified vesting commencement date (for Mr.

Coughlin, which was July 27, 2020), subject to full acceleration upon the consummation of a change in control and partial acceleration in connection with certain other events.

EBITDA PSUs granted during fiscal 2020 will vest if our earnings before interest, taxes, depreciation, and amortization (“EBITDA”), as adjusted by our board of directors, exceeds $500 million for the 2021 fiscal year, subject to the NEO’s continued employment through the end of such fiscal year.

Please read “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements” below for more information regarding these awards.

RSUs granted during fiscal 2020 will vest as to 34% on the first anniversary of the grant date and as to 16.5% at the end of each six-month period thereafter, subject to the NEO’s continued employment through each vesting date.

Stock options granted during fiscal 2020 will vest as to 34% on the first anniversary of the grant date and as to 16.5% at the end of each six-month period thereafter, subject to the NEO’s continued employment through each vesting date.

RSUs granted during fiscal 2020 will vest as to 34% on the first anniversary of the grant date and as to 33% on each of the second and third anniversaries of the grant date, subject to the NEO’s continued employment through each vesting date.

Please read “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements—Michael Nuzzo” below for more information regarding this award.

MacDonald was eligible to earn a digital growth award for fiscal 2020 based on the digital revenue and Digital EBITDA achieved during fiscal 2020, as described in more detail under “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements—Darren MacDonald” below.

The digital growth award contains threshold and maximum payouts, but it does not include a specified target payout.

Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table

Employment Agreements

Ronald Coughlin, Jr.

Effective upon our initial public offering, we entered into an amended and restated employment agreement with Mr.

Coughlin, pursuant to which he is entitled to receive a base salary of no less than $1,100,000, an annual bonus targeted at 125% of his base salary subject to the achievement of board-approved performance goals, and other customary terms and conditions.

Additionally, $2,666,667 of a previously provided stock replacement payment remains subject to repayment upon a voluntary termination or termination by us for cause prior to June 4, 2021.

In connection with the amendment and restatement, Mr.

Coughlin also received a one-time grant of EBITDA PSUs on January 13, 2021 with an aggregate value of $5,000,000, which will vest if our EBITDA, as adjusted by our board of directors, exceeds $500 million for fiscal 2021, subject to his continued employment through the end of such fiscal year.

Coughlin is eligible for certain payments upon certain terminations of employment, as described under “—Potential Payments Upon Termination or Change in Control—Employment Agreements—Ronald Coughlin, Jr.” below.

Coughlin’s agreement (and his amended and restated agreement) also subjects him to covenants regarding non-solicitation of our partners and our customers, vendors, distributors, and strategic partners while Mr.

Coughlin is employed by us and for one year thereafter.

Coughlin is also a party to our standard Employee Proprietary Information and Inventions Agreement and our standard Confidentiality and Inventions Agreement which, among other things, provide us standard protections regarding the confidentiality of our proprietary information and our ownership of intellectual property.

Michael Nuzzo

Nuzzo is party to an employment agreement with us dated April 8, 2015, as amended January 26, 2016.

Pursuant to Mr.

Nuzzo’s employment agreement, he was entitled to receive an initial base salary of $575,000, an annual bonus targeted at 80% of his base salary subject to the achievement of performance goals, and other customary terms and conditions.

Nuzzo is eligible for certain payments upon certain terminations of employment, as described under “—Potential Payments Upon Termination or Change in Control—Employment Agreements—Michael Nuzzo” below.

The agreement subjects Mr.

Nuzzo to covenants regarding non-solicitation of our partners and our customers, vendors, distributors, and strategic partners while Mr.

Nuzzo is employed by us and for one year thereafter.

Nuzzo is also a party to our standard Confidentiality and Inventions Agreement which, among other things, provides us standard protections regarding the confidentiality of our proprietary information and our ownership of intellectual property.

Nuzzo is also party to a special retention bonus agreement, dated August 31, 2018, which was amended and restated effective October 8, 2020 and further amended and restated effective December 3, 2020, that provides the opportunity for potential bonuses and awards, as described below.

Cash retention bonuses totaling $1,500,000, of which $500,000 was paid in October 2019 and $1,000,000 will be paid in April 2021.

One-time grant of EBITDA PSUs with an aggregate value of $2,000,000, which will vest if our EBITDA, as adjusted by our board of directors, exceeds $500 million for fiscal 2021, subject to his continued employment through the end of such fiscal year, which was granted on January 13, 2021.

One-time grant of 3,000,000 C Units granted in September 2020 (described above under “Compensation Discussion and Analysis—Elements of Compensation—Long-Term Equity Incentive Compensation—Fiscal Year 2020 Long-Term Equity Incentive Compensation Actions”).

To better align Mr.

Nuzzo with the interests of current equity holders, this grant utilizes a special higher Distribution Threshold of $1.00 per unit.

The award recognizes the unique role that Mr.

Nuzzo plays with respect to generating future value and provides a heightened threshold for his attainment of reward associated with any future value generated by Petco.

One-time RSUs award with an aggregate value of $3,000,000, which was granted on January 13, 2021.

The RSUs vest over three years following the date the award is issued, with 34% vesting on the first anniversary of such date and 33% vesting on each of the second and third anniversaries of such date.

Nuzzo is eligible for certain payments upon certain terminations of employment and change in control events under the Nuzzo Employment Agreement and the special retention bonus agreement, as described under “—Potential Payments Upon Termination or Change in Control—Employment Agreements—Michael Nuzzo” below.

Darren MacDonald

In connection with his appointment, we entered into an employment agreement with Mr.

MacDonald on May 25, 2019, pursuant to which Mr.

MacDonald is entitled to receive a base salary of $550,000, annual bonus targeted at 80% of his base salary subject to achievement of performance goals, relocation assistance, and other customary terms and conditions.

Pursuant to Mr.

MacDonald’s employment agreement, Mr.

MacDonald was paid a retention bonus of $675,000 in February 2020 (one-half of which is subject to repayment upon voluntary termination or a termination by us for cause prior to June 18, 2021).

In addition, Mr.

MacDonald will be entitled to a “digital growth award” based on revenues and EBITDA of our digital platform (“Digital EBITDA”) for each fiscal year through the fiscal year ending January 29, 2022, and Digital EBITDA is defined to mean (i) sales on our digital platform, less (ii) cost of goods sold attributable to such sales, less (iii) direct marketing spending on the digital platform, less (iv) any other direct expenses related to the digital platform, and subject to adjustment by our board in specified circumstances.

The amount of the bonus will be determined as follows:

Digital Revenue

Minimum Digital

Amount of Digital

Less than $538 million

At least $538 million but less than $591 million

At least $591 million but less than $619 million

At least $619 million but less than $645 million

$645 million or more

If digital revenue is in a range above the corresponding Digital EBITDA range but the minimum Digital EBITDA goal is not met, then the award will be the amount in the immediately-preceding row (e.g., if digital revenue were $600 million but Digital EBITDA were less than $43 million, the award would be $500,000).

Any earned bonus will be paid following a change in control, an initial public offering, a secondary public offering, or a cash dividend to our stockholders, subject to specified caps.

Except as described under “—Potential Payments Upon Termination or Change in Control—Employment Agreements—Darren MacDonald” below, Mr.

MacDonald must remain employed by us through the payment date in order to receive payment of any earned award.

Under the terms of the employment agreement, the digital growth award, if earned, will be settled one-half in cash and one-half in fully vested B Units.

Following the end of fiscal 2020, the Compensation Committee and our board of directors determined that Mr.

MacDonald earned a digital growth award of $2,420,000 based on the digital revenue and Digital EBITDA achieved during fiscal 2020.

In lieu of settling the digital growth award earned for fiscal 2020 in cash and fully vested B Units, the Compensation Committee recommended, and our board of directors approved, the settlement of the award one-half in cash and one-half in restricted stock under the 2021 Plan.

The restricted stock will vest as to 50% on each of the first and second anniversaries of the March 30, 2021 date of grant, generally subject to Mr.

MacDonald’s continued employment through each vesting date.

MacDonald is eligible for certain payments upon certain terminations of employment, as described under “—Potential Payments Upon Termination or Change in Control—Employment Agreements—Darren MacDonald” below.

The agreement also subjects Mr.

MacDonald to covenants regarding non-solicitation of our partners and our customers, vendors, distributors, and strategic partners while Mr.

MacDonald is employed by us and for one year thereafter.

MacDonald is also a party to our standard Confidentiality and Inventions Agreement which, among other things, provides us standard protections regarding the confidentiality of our proprietary information and our ownership of intellectual property.

In connection with his appointment, we entered into an employment letter agreement with Mr.

Tichy on September 17, 2018, pursuant to which Mr.

Tichy was entitled to an initial base salary of $480,000, an annual bonus targeted at 60% of his base salary subject to achievement of performance goals, an initial signing bonus, and other customary terms and conditions.

Pursuant to the agreement, Mr.

Tichy will receive a cash retention bonus of $500,000 in April 2021 because he remained employed by us in good standing through March 31, 2021 and a change in control event did not occur prior to such date.

Additionally, Mr.

Tichy is eligible for a bonus of $36,000, $24,000 of which was paid prior to fiscal 2020, with the remaining $12,000 installment paid in November 2020.

Tichy is eligible for certain payments upon certain terminations of employment, as described under “ — Potential Payments Upon Termination or Change in Control—Employment Agreements—Justin Tichy” below.

Tichy is also a party to our standard Confidentiality and Inventions Agreement which, among other things, provides us standard protections regarding the confidentiality of our proprietary information and our ownership of intellectual property.

Ilene Eskenazi

In connection with her appointment on September 14, 2020, we entered into an employment letter agreement with Ms.

Eskenazi on July 20, 2020, pursuant to which Ms.

Eskenazi was entitled to an initial base salary of $490,000, an annual bonus targeted at 60% of her base salary subject to achievement of performance goals, a $225,000 sign-on bonus payable $125,000 in fiscal 2020 and $100,000 payable in September 2021 subject to her continued employment, housing assistance for two years (which has not yet commenced), and other customary terms and conditions.

Pursuant to the agreement, Ms.

Eskenazi’s annual bonus for fiscal 2020 was at least $294,000 and her base salary will be increased in spring 2021 to $500,000.

Eskenazi is eligible for certain payments upon certain terminations of employment, as described under “—Potential Payments Upon Termination or Change in Control—Employment Agreements—Ilene Eskenazi” below.

Eskenazi is also a party to our standard Confidentiality and Inventions Agreement which, among other things, provides us standard protections regarding the confidentiality of our proprietary information and our ownership of intellectual property.

Outstanding Equity Awards at 2020 Fiscal Year-End

The following table reflects information regarding outstanding unvested C Units, stock options, RSUs and EBITDA PSUs held by our NEOs as of January 30, 2021.

Option Awards

Unexercisable

Units or Other

Equity Incentive

Shares, Units

or Other Rights

Ronald Coughlin, Jr.

C Units (1)(2)

Stock Options (3)

EBITDA PSUs (5)

Michael Nuzzo

C Units (1)(6)

Stock Options (3)

EBITDA PSUs (5)

Darren MacDonald

C Units (1)(8)

Stock Options (3)

C Units (1)(9)

Stock Options (3)

Ilene Eskenazi

C Units (1)(10)

Stock Options (3)

The C Units are intended to qualify as “profits interests” for U.S.

tax purposes.

They do not require the payment of an exercise price, but are economically similar to stock appreciation rights because they have no value for tax purposes as of the grant date and will obtain value only as the value of the underlying value of the security rises above its Distribution Threshold.

C Units that were granted in the past, and particularly those granted during periods of lower company performance, typically have lower Distribution Thresholds and thus the

greatest potential opportunity for appreciation.

The amounts in these rows represent the total unvested C Units that were held by our NEOs as of January 30, 2021, all of which were granted prior to our initial public offering, including as far back as 2018.

Coughlin’s unvested C Units were granted with the following Distribution Thresholds and have vested or will vest ratably on the following vesting dates subject to his continued employment with us through each vesting date:

Vesting Dates

June 4, 2021, June 4, 2022, and June 4, 2023

April 1, 2021, April 1, 2022, April 1, 2023, and April 1, 2024

July 27, 2021, July 27, 2022, July 27, 2023, July 27, 2024, and July 27, 2025

These stock options vest as to 34% on January 13, 2022 and as to 16.5% at the end of each six-month period thereafter, in each case, subject to the NEO’s continued employment with us through each vesting date.

These RSUs vest as to 34% on January 13, 2022 and as to 16.5% at the end of each six-month period thereafter, in each case, subject to the NEO’s continued employment with us through each vesting date.

The EBITDA PSUs will vest if our EBITDA, as adjusted by our board of directors, exceeds $500 million for the 2021 fiscal year, subject to the NEO’s continued employment through the end of such fiscal year.

Nuzzo’s unvested C Units were granted with the following Distribution Thresholds and will vest ratably on the following vesting dates subject to his continued employment with us through each vesting date:

Vesting Dates

January 26, 2022 and January 26, 2023

16, 2021, Sept.

16, 2022, Sept.

16, 2023, Sept.

16, 2024, and Sept.

These RSUs vest ratably on each of the first three anniversaries of January 13, 2021, in each case, subject to Mr.

Nuzzo’s continued employment with us through each vesting date.

MacDonald’s unvested C Units were granted with a Distribution Threshold of $0.50 and will vest ratably on July 1, 2021, July 1, 2022, July 1, 2023, and July 1, 2024, in each case, subject to his continued employment with us through each vesting date.

Tichy’s unvested C Units were granted with the following Distribution Thresholds and will vest ratably on the following vesting dates subject to his continued employment with us through each vesting date:

Vesting Dates

January 2, 2022, January 2, 2023, and January 2, 2024

3, 2021, Aug.

3, 2022, Aug.

3, 2023, Aug.

3, 2024, and Aug.

Eskenazi’s unvested C Units were granted with a Distribution Threshold of $0.60 and will vest ratably on September 16, 2021, September 16, 2022, September 16, 2023, September 16, 2024 and September 16, 2025, in each case, subject to her continued employment with us through each vesting date.

Other than with respect to C Units, amounts in these columns reflect the value of outstanding RSUs or EBITDA PSUs as of January 30, 2021, based on a per share price of $26.03, the closing price of our Class A common stock on January 29, 2021, the last trading day of fiscal 2020.

With respect to C Units, amounts in these columns reflect the value of outstanding C Units as of January 30, 2021 based on the distributions the C Units would be eligible to receive upon a liquidation of Scooby LP using the closing price of our Class A common stock on January 29, 2021, the last trading day of fiscal 2020 for purposes of valuing the Class A common stock held indirectly by Scooby LP.

The per C Unit value is reduced by the applicable Distribution Threshold.

Option Exercises and Stock Vested

The following table reflects the C Units held by our NEOs which vested during fiscal 2020.

Number of Shares

Value Realized on

Vesting ($)(1)

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

For vesting that occurred prior to our initial public offering, the value of the C Units is determined by reference to third party valuations, using interpolation for vesting dates that occurred between the final valuation and our initial public offering.

For vesting that occurred following our initial public offering, the value of the C Units is determined based on the distributions the C Units would be eligible to receive upon a liquidation of Scooby LP using the closing price of our Class A common stock on the applicable vesting date for purposes of valuing the Class A common stock held indirectly by Scooby LP.

In each case, the per C Unit value is reduced by the applicable Distribution Threshold.

Coughlin, each of his C Units that vested during fiscal 2020 had a Distribution Threshold in excess of the per C Unit value.

Nonqualified Deferred Compensation

The following table sets forth information regarding the value of accumulated benefits of our NEOs under our nonqualified deferred compensation arrangements as of January 30, 2021.

Contributions

in Last FY ($)(1)

Contributions

in Last FY ($)(2)

in Last FY ($)

Distributions ($)

Balance at Last

Ronald Coughlin, Jr.

Michael Nuzzo

Darren MacDonald

Ilene Eskenazi

Amounts in this column represent base salary and annual bonuses that were payable during fiscal 2020 but the receipt of which was deferred.

These amounts are included in the Summary Compensation Table under “Salary” and “Bonus” for fiscal 2020 and under “Bonus” for the 2019 fiscal year (which were paid during fiscal 2020).

Amounts in this column represent matching contributions of the NEO’s contributions, which are included in the Summary Compensation Table under “All Other Compensation” for fiscal 2020.

The aggregate balance for each NEO includes the following amounts that were included in the Summary Compensation Table in prior fiscal years:

Coughlin, $1,127,373 and (ii) for Mr.

MacDonald, $15,360.

Coughlin and MacDonald and, beginning January 2021, Mr.

Tichy have elected to participate in our nonqualified deferred compensation plan, which is an unfunded plan that is available to executives and certain key partners and directors of Petco.

Under the plan and pursuant to the terms of their employment agreements, as applicable, participants are permitted to defer a portion of their annual base salary and bonus.

We make a matching contribution of 50% of an eligible partner’s contributions on the first 3% of base salary deferred (or, if the eligible partner is not yet eligible to participate in our 401(k) plan, the first 6% of base salary deferred) and on the first 6% of annual bonus deferred.

Participants are 100% vested in matching contributions.

Participants may select among a broad range of investment alternatives under this plan, and participants’ accounts are credited with a rate of return based on the performance of the selected investments.

Petco does not provide above-market or preferential earnings on deferred compensation.

If a participant separates from service on or after reaching age 55 and attaining six years of service, the participant’s account may be paid in a single lump sum or in annual installments from two to ten years (at the participant’s election).

If a participant separates from service without meeting the age and service requirements set forth above, or as a result of his or her death or disability, the participant (or his or her beneficiaries, as applicable) will receive his or her account balance in the form of a lump sum.

We have established a rabbi trust to assist in meeting a portion of our obligations under the plan.

To the extent required to comply with Section 409A of the Code, payment upon termination of employment is subject to a six-month delay.

Potential Payments Upon Termination or Change in Control

Employment Agreements

Ronald Coughlin, Jr.

Coughlin’s amended employment agreement provides severance benefits to Mr.

Coughlin in the event he is terminated without “Cause” or he resigns for “Good Reason,” in each case, subject to his execution of a release of claims.

If such termination occurs more than three months prior to or more than 18 months following a “Change in Control”, the severance benefits include:

(i) a lump sum payment equal to 18 months of his base salary;

(ii) payment of any unpaid annual bonus from a prior fiscal year;

(iii) a pro rata annual bonus for the year of termination based on actual achievement of applicable performance goals;

(iv) pro-rata acceleration of the EBITDA PSUs if the EBITDA goal for the 2021 fiscal year is ultimately achieved;

(v) acceleration of all time-based equity awards (excluding C Units) that would have vested during the 12 months following such termination;

(vi) acceleration of all performance-based equity awards (excluding C Units and the EBITDA PSUs) for which the performance period ends during the 12 months following such termination, so long as such performance-based goals are actually achieved;

and (vii) Petco-paid continued health insurance benefits under COBRA for up to 18 months following Mr.

Coughlin’s termination.

Additionally, in the event such termination without Cause or resignation for Good Reason occurs within the three months prior to or the 18 months following a Change in Control, Mr.

Coughlin will be eligible for the following severance benefits in lieu of the severance benefits described above:

(i) a lump sum payment equal to two times the sum of his base salary and target annual bonus;

(ii) payment of any unpaid annual bonus from a prior fiscal year;

(iii) a pro rata annual bonus for the year of termination based on actual achievement of applicable performance goals;

(iv) acceleration of the EBITDA PSUs if the EBITDA goal for fiscal 2021 is ultimately achieved;

(v) accelerated vesting of time-based equity awards (excluding C Units);

(vi) all outstanding performance-based equity awards (excluding C Units and EBITDA PSUs) will remain outstanding and eligible to become earned based on achievement of the performance-based goals as if Mr.

Coughlin had remained employed;

and (vii) Petco-paid continued health insurance benefits under COBRA for up to 18 months following such termination.

Coughlin’s amended and restated employment agreement also provides for the following accelerated vesting benefits upon a termination of his employment as a result of death or “Disability”:

(i) accelerated vesting of time-based equity awards (excluding C Units);

(ii) all outstanding performance-based equity awards (excluding C Units and EBITDA PSUs) will remain outstanding an eligible to become earned based on achievement of the performance-based goals as if Mr.

Coughlin had remained employed;

and (iii) acceleration of the EBITDA PSUs if the EBITDA goal for fiscal 2021 is ultimately achieved.

Upon a Change in Control, if the benefits under Mr.

Coughlin’s amended and restated employment agreement would trigger an excise tax under Section 4999 of the Code, the amended and restated employment agreement provides that Mr.

Coughlin’s benefits will be reduced to a level at which the excise tax is not triggered, unless Mr.

Coughlin would receive a greater amount without such reduction after taking into account the excise tax and other applicable taxes.

For purposes of Mr.

Coughlin’s employment agreement:

“Cause” includes (i) Mr.

Coughlin’s material breach of his employment agreement;

(ii) the willful failure or refusal by him to substantially perform his duties;

(iii) the conviction of Mr.

Coughlin of, or the entering of a plea of nolo contendere by him with respect to, a felony or a misdemeanor involving moral turpitude;

Coughlin’s inability or failure to competently perform his duties in any material respect due to the use of drugs or alcohol;

Coughlin’s material breach of any policy or code of conduct of Petco, subject to, in the cases of clauses (i), (ii) and (v), customary notice and cure provisions.

“Change in Control” has the meaning provided under the 2021 Plan.

“Disability” means that Mr.

Coughlin is either (i) unable to engage in substantially gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or last for a continuous period of not less than 12 months or (ii) is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months Petco’s accident and health plan.

“Good Reason” means (i) the removal of Mr.

Coughlin from our board of directors;

(ii) a material diminution in his authority, duties or responsibilities;

(iii) a requirement that he report to any person or body other than our board of directors;

(iv) a material diminution in his base salary or target bonus amount;

(v) the relocation of his office by more than 30 miles;

(vi) our failure to obtain the assumption in writing of its obligation to perform the amended and restated employment agreement by any successor to all or substantially all of our assets, whether direct or indirect by a merger, consolidation, sale or similar transaction, unless such assumption occurs by operation of law;

or (vii) any other action or inaction that constitutes a material breach by us of his amended and restated employment agreement, in each case, subject to customary notice and cure provisions.

Michael Nuzzo

Nuzzo’s employment agreement provides severance benefits to Mr.

Nuzzo in the event he is terminated without “Cause” or he resigns for “Good Reason,” in each case, subject to his execution of a release of claims.

The severance benefits include:

(i) a lump sum payment equal to 18 months of base salary, and (ii) if the termination is without “Cause” and occurs within 12 months following a change in control, a pro rata bonus for the year of termination, based on actual performance immediately prior to such termination, but in no event greater than the target bonus.

For purposes of Mr.

Nuzzo’s employment agreement:

“Cause” includes (i) Mr.

Nuzzo’s material breach of his employment agreement;

(ii) the failure or refusal by Mr.

Nuzzo to perform his duties;

(iii) the conviction of Mr.

Nuzzo of, or the entering of a plea of nolo contendere by him with respect to, a felony;

Nuzzo’s violation of our code of ethics or policies against discrimination or harassment;

Nuzzo’s inability or failure to competently perform his duties in any material respect due to the use of drugs or alcohol, in the cases of clauses (i) and (ii), subject to customary notice and cure provisions.

“Good Reason” means (i) a material diminution in Mr.

Nuzzo’s authority, duties or responsibilities;

(ii) a material diminution in the authority, duties or responsibilities or the person to whom Mr.

Nuzzo reports;

(iii) a material diminution in Mr.

Nuzzo’s base compensation;

(iv) a material diminution of the budget over which Mr.

Nuzzo has authority;

(v) the relocation of his office to a location more than 50 miles from its present location other than a relocation to our San Antonio Support Center;

(vi) our failure to obtain the assumption in writing of its obligation to perform the employment agreement by any successor to all or substantially all of our assets;

or (vii) any other action or inaction that constitutes a material breach by us of Mr.

Nuzzo’s employment agreement, in each case, subject to customary notice and cure provisions.

In addition to the benefits under his employment agreement, if Mr.

Nuzzo’s employment is terminated without Cause, he will receive a pro rata portion of any unpaid retention bonuses based on the number of days Mr.

Nuzzo was employed from August 31, 2018 through the date of such termination as compared to the number of days from August 31, 2018 through March 31, 2021, the date the final portion of the retention bonus is required to be paid.

Additionally, upon the occurrence of a Change in Control (as described below under “—C Units”), any unpaid retention bonus will be paid in full.

Darren MacDonald

MacDonald’s employment agreement provides severance benefits to Mr.

MacDonald in the event he is terminated without “Cause” or he resigns for “Good Reason,” in each case, subject to his execution of a release of claims.

The severance benefits include:

(i) a lump sum payment equal to 12 months of his base salary;

(ii) a pro rata annual bonus for the year of termination based on actual performance;

(iii) if the termination is less than six months prior to a change in control, public offering, secondary public offering, or payment of any cash dividend to our shareholders, payment of any earned Digital Growth Award;

and (iv) Petco-paid continued health insurance benefits under COBRA for up to 12 months following Mr.

MacDonald’s termination.

For purposes of Mr.

MacDonald’s employment agreement:

“Cause” includes (i) Mr.

MacDonald’s material breach of his employment agreement;

(ii) the intentional and material failure or refusal by Mr.

MacDonald to substantially perform his duties;

(iii) the conviction of Mr.

MacDonald of, or the entering of a plea of nolo contendere by him with respect to, a felony or a misdemeanor involving moral turpitude;

MacDonald’s substantial inability or failure to perform the essential functions of his position even with reasonable accommodation as required by law, in the cases of clauses (i), (ii) and (iv), subject to customary notice and cure provisions.

“Good Reason” means (i) a material diminution in Mr.

MacDonald’s authority, duties or responsibilities;

(ii) a requirement that he report to any person or body other than the chief executive officer or our board of directors;

(iii) a diminution in his base salary;

(iv) the relocation of his office to a location more than 50 miles from its present location;

(v) our failure to obtain the assumption in writing of its obligation to perform the employment agreement by any buyer or successor to us upon the effective date of merger, consolidation, sale or similar transaction, unless such assumption occurs by operation of law;

or (vi) any other action or inaction that constitutes a material breach by us of Mr.

MacDonald’s employment agreement, in each case, subject to customary notice and cure provisions.

Tichy’s employment letter provides severance benefits in the event he is terminated without cause, subject to his execution of a release of claims.

The severance benefits require a lump sum payment equal to 12 months of base salary.

Ilene Eskenazi

Eskenazi’s employment letter provides severance benefits in the event she is terminated without “Cause,” subject to her execution of a release of claims.

The severance benefits are a lump sum payment equal to 12 months of base salary and six months of outplacement services.

For purposes of Ms.

Eskenazi’s employment letter, “Cause” means (i) Ms.

Eskenazi’s material and willful breach of fiduciary duty in the performance of her duties, subject to customary notice and cure, (ii) Ms.

Eskenazi’s conviction of a felony which can be reasonably expected to have a material adverse impact on Petco’s business or reputation, or (iii) Ms.

Eskenazi’s commission of any act of fraud or embezzlement with respect to Petco.

All unvested C Units will become fully vested upon the occurrence of a “Change in Control”, subject to each NEO’s continued employment through such event.

A Change in Control did not occur upon the closing of our initial public offering for purposes of the C Units.

In addition to acceleration upon a Change in Control, a portion of each NEO’s C Units may vest upon direct or indirect sales by Scooby LP of our Class A common stock, and all unvested C Units will fully accelerate in the event Scooby LP sells 90% of its direct or indirect holdings of our Class A common stock.

Upon an NEO’s termination without “Cause” (and, for Mr.

Coughlin, a resignation for “Good Reason”), (i) a pro-rata portion of the C Units that would have vested at the next regularly scheduled vesting date will be accelerated based on the number of days elapsed since the most recent vesting date as compared to the total number of days between the most recent vesting date and the next regularly scheduled vesting date;

and (ii) the NEO will continue to receive the benefit of the preceding paragraph for direct or indirect sales of our Class A common stock by Scooby LP up to 180 days following the date of termination.

For purposes of the C Units, “Cause” and “Good Reason” generally have the meaning provided in the applicable NEO’s employment agreement or employment letter or, if such agreement does not define such term, the meaning set forth in the Scooby LP partnership agreement.

Additionally, “Change in Control” generally includes (i) a third party’s acquisition of 50% or more of Scooby LP or (ii) a third party’s acquisition of all or substantially all of the assets of Scooby LP and its subsidiaries, in each case, so long as the proceeds received by the Sponsors or Scooby LP consist of cash or marketable securities.

Additionally, the C Units are subject to customary repurchase rights in favor of Scooby LP in the event of the NEO’s termination of employment.

Equity Awards

Except with respect to awards under the 2021 Plan granted to Mr.

Coughlin, which are governed by the acceleration terms set forth under his amended and restated employment agreement as described above, the award agreements governing the outstanding stock options and RSUs under the 2021 Plan provide for accelerated vesting upon certain terminations of employment.

Upon an NEO’s termination of employment as a result of death or disability, all outstanding stock options and RSUs held by such NEO will become fully vested.

Similarly, upon a termination of an NEO’s employment without “Cause” or a resignation for “Good Reason,” in each case, within 24 months following a “Change in Control,” all outstanding stock options and RSUs held by such NEO will become fully vested.

Additionally, upon an NEO’s “Retirement,” (i) prior to the first anniversary of the grant date, a pro-rated portion of all unvested stock options and RSUs held by such NEO will become vested and (ii) on or following the first anniversary of the grant date, all outstanding stock options and RSUs held by such NEO will become fully vested.

For purposes of awards under the 2021 Plan:

“Cause” has the meaning provided in the applicable NEO’s employment agreement or employment letter or, if such agreement does not define such term, generally means (i) the NEO’s material breach of any agreement with Petco, (ii) the willful failure or refusal by the NEO to substantially perform his or her duties, (iii) the commission or conviction of the NEO of, or the entering of a plea of nolo contendere by the NEO with respect to a felony or misdemeanor involving moral turpitude, (iv) the NEO’s gross misconduct that causes harm to Petco’s reputation, or (v) the NEO’s inability or failure to competently perform his or her duties in any material respect due to the use of drugs or other illicit substances.

“Change in Control” general means the occurrence of any of the following:

(i) any person becoming the beneficial owner of 50% or more of Petco’s outstanding securities, (ii) incumbent directors cease to constitute a majority of our board of directors, (iii) consummation of a merger or consolidation, other than a merger or consolidation which would result in the holders of Petco’s voting securities prior to such transaction continue to represent at least 50% of the combined voting power of the securities of Petco or surviving entity of such transaction, (iv) implementation of a plan of complete liquidation or dissolution of Petco, or (v) a sale of all or substantially all of Petco’s assets.

“Good Reason” has the meaning provided in the applicable NEO’s employment agreement or employment letter or, if such agreement does not define such term, generally means (i) a material diminution in the NEO’s authority, duties, or responsibilities with Petco, (ii) a material diminution in the NEO’s base salary, (iii) a geographic relocation by more than 50 miles, or (iv) a material breach of Petco of its obligations under the award agreement, in each case, subject to customary notice and cure provisions.

“Retirement” means an NEO’s resignation after attaining age 55 with 10 years or more of service to Petco.

Quantification of Potential Payments

The table below sets forth the aggregate amounts that would have been payable to each NEO under the employment agreements, employment letters, C Units, and award agreements under the 2021 Plan, as described above, assuming the applicable termination event or Change in Control occurred on January 30, 2021.

As of January 30, 2021, none of our NEOs were Retirement-eligible for purposes of awards granted under the 2021 Plan.

without Cause

Resignation for

Disability ($)

Termination in

Connection with a

Change in Control

Ronald Coughlin, Jr.

Cash Payments (2)

Continued Health Benefits (3)

Equity Awards (4)

Michael Nuzzo

Cash Payments (2)

Equity Awards (4)

Darren MacDonald

Cash Payments (2)

Continued Health Benefits (3)

Equity Awards (4)

Cash Payments (2)

Equity Awards (4)

Ilene Eskenazi

Cash Payments (2)

Outplacement Benefits (5)

Equity Awards (4)

Amounts in this column also include (i) severance payable upon a qualifying termination that is not in connection with a change in control for those NEOs who do not receive enhanced severance benefits upon a qualifying termination in connection with a change in control and (ii) the value of C Units that would become vested upon a change in control without regarding to any corresponding qualifying termination.

These amounts include cash severance payments under the employment agreements and employment letters, as well as any acceleration of cash bonuses.

Amounts in this row are based on premiums in effect as of February 1, 2021, which are assumed for purposes of these calculations to remain in effect throughout the duration of the period in which continued health benefits are provided.

MacDonald, although he eligible to receive continued health benefits under the terms of his employment agreement, as of February 1, 2021, he was not a participant in our health plan and thus would not have received any benefit had the applicable termination occurred on such date.

Amounts in this row reflect (i) the C Units that would become vested upon occurrence of the applicable event based on the value as of January 30, 2021 based on the distributions the C Units would be eligible to receive upon a liquidation of Scooby LP using the closing price of our Class A common stock on January 29, 2021, the last trading day of fiscal 2020 for purposes of valuing the Class A common stock held indirectly by Scooby LP, less the applicable Distribution Threshold and (ii) the stock options and RSUs that would become vested upon occurrence of the applicable event based on a per share price of $26.03, the closing price of our Class A common stock on January 29, 2021, the last trading day of fiscal 2020, less the exercise price, if applicable.

No amounts are included for the EBITDA PSUs, as such awards would have remained subject to achievement of the applicable performance goals following any of the applicable events.

Amounts in this row include the estimated value of outplacement benefits for six months.

Director Compensation

Prior to our initial public offering, we paid cash compensation to our independent, non-employee directors for their services as directors.

In connection with our initial public offering, we adopted a director compensation program pursuant to which members of our board of directors who are not employees or officers of our company, the Principal Stockholder, CVC, CPP Investments or their respective affiliates shall receive:

Annual cash retainer of $80,000;

Cash fee of $35,000 for service as chairperson or $10,000 for service other than as chairperson of the Audit Committee;

Cash fee of $25,000 for service as chairperson or $10,000 for service other than as chairperson of the Compensation Committee;

Cash fee of $20,000 for service as chairperson or $7,500 for service other than chairperson of the Nominating and Corporate Governance Committee;

Cash fee of $150,000 for service as the non-executive chair of our board of directors;

Cash fee of $50,000 for service as the lead director of our board of directors;

Annual equity grant of RSUs under the 2021 Plan with a value of approximately $150,000, subject to one-year cliff vesting on the day of the next annual stockholder meeting.

In addition, our director compensation program provides each director with reimbursement for reasonable travel and miscellaneous expenses incurred in attending meetings and activities of our board of directors and its committees.

In connection with our initial public offering, each eligible member of our board of directors received a pro-rata annual equity grant of RSUs on January 13, 2021, which will vest in connection with our 2021 annual stockholder meeting;

however, subsequently appointed members of our board of directors will not be eligible to receive pro-rata annual equity grants prior to the 2021 annual stockholder meeting.

In connection with her appointment, Ms.

Simmons also received an additional grant of RSUs under the 2021 Plan with a value of approximately $150,000, subject to cliff vesting in connection with our 2022 annual stockholder meeting.

The table below describes the compensation provided to our independent, non-employee directors in f iscal 2020.

Fees Earned or Paid

Maximilian Biagosch (1)

Cameron Breitner (1)

Nishad Chande (1)

Jennifer Pereira (1)

Sabrina Simmons

Christopher J.

Mary Sullivan (1)

These directors are not eligible for compensation under our director compensation program and did not receive any compensation from us during fiscal 2020.

Amounts in this column represent the aggregate grant date fair value of the RSUs granted during fiscal 2020, calculated in accordance with FASB ASC Topic 718.

For additional information regarding the assumptions underlying this calculation please read Note 13 to our consolidated financial statements for the fiscal year ended January 30, 2021.

As of January 30, 2021, Mr.

Briggs and Ms.

Lake each held 1,500,000 C Units originally granted in 2018 with a Distribution Threshold of $0.50, which are generally subject to the same terms as the C Units granted to our NEOs, as described under “Executive Compensation—Compensation Discussion and Analysis—Elements of Compensation—Long-Term Equity Incentive Compensation” above.

Additionally, as of January 30, 2021, each independent director held the following unvested RSUs:

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth information as of April 1, 2021 (or as of the date otherwise indicated below) regarding beneficial ownership by:

each person known to us to beneficially own more than 5% of any class of our outstanding common stock;

our directors and director nominees;

each of our named executive officers (as listed in the Summary Compensation Table above);

all of our directors and executive officers as a group.

Unless otherwise noted, the mailing address of each listed beneficial owner is 10850 Via Frontera, San Diego, California 92127.

The number of shares beneficially owned by each entity or individual is determined under SEC rules, and the information is not necessarily indicative of beneficial ownership for any other purpose.

Under such rules, beneficial ownership includes any shares as to which the entity or individual has sole or shared voting or investment power and also any shares that the entity or individual has the right to acquire as of May 31, 2021 (60 days after April 1, 2021) through the exercise of any stock options, through the vesting/settlement of RSUs payable in shares, or upon the exercise of other rights.

Beneficial ownership excludes options or other rights vesting after May 31, 2021 and any RSUs vesting/ settling, as applicable, on or before May 31, 2021 that may be payable in cash or shares at Petco’s election.

Unless otherwise indicated, each person has sole voting and investment power (or shares such power with his or her spouse, as applicable) with respect to the shares set forth in the following table.

The percentage ownership information shown in the following table is based on 226,424,140 shares of our Class A common stock, 37,790,781 shares of our Class B-1 common stock and 37,790,781 shares of our Class B-2 common stock outstanding as of April 1, 2021.

The rights of the holders of our Class A common stock and our Class B-1 common stock are identical in all respects, except that our Class B-1 common stock does not vote on the election or removal of directors.

The rights of the holders of our Class B-2 common stock differ from the rights of

the holders of our Class A common stock and Class B-1 common stock in that holders of our Class B-2 common stock only possess the right to vote on the election or removal of directors.

Certain Stockholders

Scooby Aggregator,

CVC B-2 SPV, LLC(3)(5)

9314601 B-2 SPV, LLC(6)

Directors and Named

Executive Officers

Ronald Coughlin, Jr.

Michael Nuzzo

Ilene Eskenazi

Darren MacDonald

Maximilian Biagosch

Cameron Breitner

Nishad Chande

Michael Mohan

Jennifer Pereira

Sabrina Simmons

Christopher J.

Mary Sullivan

All Directors and Executive

Officers as a group

* Represents holdings of less than 1% of any class of our common stock.

Does not include the right to vote on the election or removal of our directors.

Represents shares of our common stock directly held by Scooby Aggregator, LP, our Principal Stockholder.

The general partner of Scooby Aggregator, LP is Scooby Aggregator GP, LLC, a member managed limited liability company whose sole member is Scooby LP.

The general partner of Scooby LP is Scooby GP LLC, a member managed limited liability company whose sole members are CVC Pet LP and CPP Investments.

Both CVC Pet LP and CPP Investments have material consent rights with respect to the actions of Scooby GP LLC.

As described below under “Item 1.

Certain Relationships and Related Transactions, and Director Independence—Related Person Transactions—Note Purchase Agreement,” our Principal Stockholder entered into a Note Purchase Agreement (as defined below), pursuant to which the Notes (as defined below) were issued.

The Notes are secured by a pledge of all of our common stock held by (i) our Principal Stockholder and (ii) CVC B-2 SPV, LLC and 9314601 B-2 SPV, LLC, as guarantors under the Note Purchase Agreement.

Investment and voting power with regard to shares directly held by CVC Pet LP rests with the board of directors of its general partner, CVC Scooby Jersey GP Limited.

Certain investment funds managed by CVC Capital Partners VI Limited wholly own CVC Scooby Jersey GP Limited, and investment and voting power with regard to the shares held by such funds rests with the board of directors of CVC Capital Partners VI Limited, which consists of Carl Hansen, Victoria Cabot and Fred Watt, each of whose address is c/o CVC Capital Partners VI Limited, 27 Esplanade, St Helier, Jersey JE1 1SG, Channel Islands.

Each of these individuals may be deemed to indirectly share voting and/or investment power over the shares held of record by Scooby Aggregator, LP.

The approval of a majority of such directors is required to make any investment or voting decision with regard to any shares beneficially owned by CVC Pet LP, and as such, each such individual disclaims beneficial ownership of such shares.

Investment and voting power with regard to shares indirectly beneficially held by CPP Investments (through Scooby Aggregator, LP) rests with Canada Pension Plan Investment Board.

John Graham is the President and Chief Executive Officer of Canada Pension Plan Investment Board and, in such capacity, may be deemed to have voting and dispositive power with respect to the shares of common stock beneficially owned by Canada Pension Plan Investment Board.

Graham disclaims beneficial ownership over any such shares.

of Canada Pension Plan Investment Board is One Queen Street East, Suite 2500, P.O.

Box 101, Toronto, Ontario, M5C 2W5, Canada.

Represents shares of our Class B-2 common stock directly held by CVC B-2 SPV, LLC, a wholly owned subsidiary of CVC Pet LP.

Represents shares of our Class B-2 common stock directly held by 9314601 B-2 SPV, LLC, a wholly owned indirect subsidiary of Richard Hamm, who is unaffiliated with Canada Pension Plan Investment Board.

9314601 B-2 SPV, LLC has agreed not to vote or transfer any shares of Class B-2 common stock held by it or such subsidiary except as directed by Canada Pension Plan Investment Board, and accordingly, Canada Pension Plan Investment Board may be deemed to beneficially own such shares held by 9314601 B-2 SPV, LLC or such subsidiary for purposes of Section 13(d) of the Exchange Act.

See footnote (4) above for information regarding Canada Pension Plan Investment Board.

These shares are held in accounts for Mr.

Coughlin’s children, and Mr.

Coughlin is the custodian of the accounts.

Coughlin disclaims beneficial ownership of the shares held in the custodial accounts.

Includes 500 shares held in an account for Mr.

Hassan’s child, and Mr.

Hassan is the custodian of the account.

Hassan disclaims beneficial ownership of the shares held in the custodial account.

Equity Incentive Plan Compensation

The following table sets forth information about our Class A common stock that may be issued under equity compensation plans as of January 30, 2021.

Securities To be

Exercise Price of

Available for

Future Issuance

Column (a))(3)

Equity Compensation Plans Approved

by Security Holders

2021 Equity Incentive Plan

2021 Employee Stock Purchase Plan

Equity Compensation Plans Not Approved

by Security Holders

This column reflects all EBITDA PSUs, RSUs and stock options granted under the 2021 Plan that were outstanding as of January 30, 2021.

This column reflects the weighted-average exercise price of stock options granted under the 2021 Plan that were outstanding as of January 30, 2021.

EBITDA PSUs and RSUs reflected in column (a) are not reflected in this column as they do not have an exercise price.

This column reflects the total shares of our Class A common stock remaining available for issuance under the 2021 Plan and the ESPP as of January 30, 2021.

Certain Relationships and Related Transactions, and Director Independence .

Procedures for Review, Approval, and Ratification of Related Person Transactions

Our board of directors adopted a written policy regarding the review, approval, ratification, or disapproval by our Audit Committee of transactions between us or any of our subsidiaries and any related person (defined to include our executive officers, directors or director nominees, any stockholder beneficially owning in excess of 5% of our stock or securities exchangeable for our stock, and any immediate family member of any of the foregoing persons) in which the amount involved since the beginning of our last completed fiscal year will or may be expected to exceed $120,000 and in which one or more of such related persons has a direct or indirect material interest.

In approving or rejecting any such transaction, our Audit Committee will consider the relevant facts and circumstances available and deemed relevant to the Audit Committee.

Any member of the Audit Committee who is a related person with respect to a transaction under review will not be permitted to participate in the deliberations or vote on approval, ratification, or disapproval of the transaction.

Other than the transactions described below under the “Related Person Transactions,” there have been no other “related person transactions” that require disclosure under the SEC rules since the beginning of our last completed fiscal year.

Related Person Transactions

3.00% Senior Notes

In January 2016, we issued 0.75% Senior Unsecured Notes in an initial aggregate principal amount of $125,000,000 to Scooby LP and other noteholders.

On April 16, 2019, the notes were extended, amended, and restated with an interest rate of 3.00% (with effectiveness from January 26, 2019) (as amended, the “3.00% Senior Notes”).

The 3.00% Senior Notes were subsequently extended, amended, and restated on July 25, 2019, February 3, 2020, and September 28, 2020.

As of September 28, 2020, Scooby LP held a total principal amount of $120.4 million of the 3.00% Senior Notes.

In connection with our initial public offering, the noteholders, including Scooby LP, contributed $132 million aggregate principal amount of the outstanding 3.00% Senior Notes to us, plus accrued and unpaid interest.

In connection with the contribution, we paid Scooby LP $4 million to cover certain of its expenses.

After accounting for an offset of certain inter-company indebtedness, we cancelled the 3.00% Senior Notes and recorded the cancellation as a capital contribution to us.

For more information about the 3.00% Senior Notes, please read Note 9 to our historical consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Promissory Note

Scooby LP holds a promissory note issued by Petco Animal Supplies with an initial principal amount of $3.5 million in connection with the acquisition by Petco Animal Supplies of an online pet healthcare service on March 22, 2017.

Half of this promissory note was redeemed effective as of March 25, 2019, and the remaining half of the promissory note equal to approximately $1.9 million remained outstanding as of January 30, 2021.

Management Services Agreement

On January 26, 2016, in connection with the acquisition of our company by our Sponsors, Petco Animal Supplies entered into a management services agreement with certain affiliates and/or investment advisors of our Sponsors (the “Sponsor MSA Parties”), pursuant to which, among other things, the Sponsor MSA Parties agreed to provide certain management and financial services to us.

The services include management, consulting, and financial planning services in connection with the operation and growth of our company.

As compensation for such services, we agreed to reimburse the Sponsor MSA Parties’ costs for services rendered, including expenses related to maintaining the holding company structure through which our Sponsors own us indirectly, plus reimbursement of reasonable out-of-pocket expenses incurred in connection with the services rendered.

We also agreed to provide customary indemnification to the Sponsor MSA Parties.

We paid approximately $340,000 in fiscal year 2018, $45,000 in fiscal year 2019, and $220,000 in fiscal year 2020 in costs and reimbursements.

This agreement was terminated in connection with the closing of our initial public offering.

Registration Rights Agreement

In connection with our initial public offering, we entered into a registration rights agreement with the Principal Stockholder.

The agreement contains provisions that require us to register under the federal securities laws the offer and resale of shares of our Class A common stock held by the Principal Stockholder upon demand thereof.

The agreement grants the Principal Stockholder the opportunity to include its shares in any registration statement filed by us in connection with a public offering of our equity securities (customarily known as “piggyback rights”).

These registration rights are subject to certain conditions and limitations.

We are generally obligated to pay all registration expenses in connection with these registration obligations, regardless of whether a registration statement is filed or becomes effective.

Stockholder’s Agreement

In connection with the completion our initial public offering, we entered into a stockholder’s agreement with the Principal Stockholder.

The stockholder’s agreement gives our Principal Stockholder the right to designate a certain number of nominees for election to our board of directors and certain committee nomination and observer rights so long as the Principal Stockholder does not sell below, or beneficially owns (directly or indirectly), as applicable, a specified percentage of our outstanding Class A common stock and Class B-1 common stock.

For additional information, please see “Item 10.

Directors, Executive Officers and Corporate Governance—Stockholders Agreement” above.

Additionally, the stockholder’s agreement provides that we will not take certain significant actions specified therein without the prior written consent of our Principal Stockholder as long as our Principal Stockholder (including its permitted transferees under the stockholder’s agreement) beneficially owns (directly or indirectly) at least 25% of the outstanding shares of Class A common stock and Class B-1 common stock (as adjusted for stock splits, combinations, reclassifications and similar transactions).

Such specified actions include:

liquidation, dissolution or winding up of our company;

any material change in the nature of the business or operations of our company and our subsidiaries, taken as a whole, as of the date of the stockholder’s agreement;

hiring or terminating our CEO and his or her successors and, so long as our Principal Stockholder beneficially owns (directly or indirectly) at least 50% of the outstanding shares of Class A common stock and Class B-1 common stock (as adjusted for stock splits, combinations, reclassifications, and similar transactions), hiring or terminating any other executive officer of our company and his or her successor;

any mergers or other transaction that, if consummated, would constitute a “change in control” (as defined in the stockholder’s agreement) or entering into any definitive agreement or series of related agreements that govern any transaction or series of related transactions that, if consummated, would result in a “change in control”;

entering into any agreement providing for the acquisition or divestiture of assets or persons, in each such case, involving consideration payable or receivable by our company or any of our subsidiaries in excess of a specified monetary threshold in a 12-month period;

any incurrence by us or any of our subsidiaries of indebtedness for borrowed money (including through capital leases, the issuance of debt securities or the guarantee of indebtedness of another person), other than indebtedness incurred under an existing and previously approved revolving credit facility, in excess of a specified monetary threshold in a 12-month period or that would result in our company’s total net leverage ratio (as defined in the First Lien Term Loan and ABL Revolving Credit Facility) exceeding 4:00:1:00;

any issuance or series of related issuances of equity securities by us or our subsidiaries, other than grants of equity securities under any equity compensation plan (including an employee stock purchase plan) approved by the board of directors or a committee thereof;

any payment or declaration of any dividend or other distribution of any shares of Class A Common Stock or Class B-1 Common Stock or entering into any recapitalization transaction the primary purpose of which is to pay a dividend of shares of Class A Common Stock or Class B-1 Common Stock;

any increase or decrease in the size of the board of directors or the committees of the board;

amendments to, or modification or repeal of, organizational documents (such as our certificate of incorporation and bylaws or equivalent organizational documents of our subsidiaries) that adversely affect any of our Principal Stockholder, CVC or CPP Investments or their respective affiliates.

Note Purchase Agreement

In connection with our initial public offering, our Principal Stockholder entered into a Note Purchase Agreement (the “Note Purchase Agreement”), dated January 19, 2021, with (i) CVC B-2 SPV, LLC, as a guarantor, and 9314601 B-2 SPV, LLC, as a guarantor (collectively, the “Guarantors”), (ii) U.S.

Bank National Association, as the notes agent and calculation agent, and (iii) certain noteholders party thereto.

Pursuant to the Note Purchase Agreement, $450,000,000 in aggregate principal amount of Senior Secured Floating Rate Notes (the “Notes”) were issued.

The Notes are secured by a pledge of all existing and after-acquired assets of our Principal Stockholder and the Guarantors, including Class A and Class B-1 common shares of the company held by our Principal Stockholder and Class B-2 common shares of the Guarantors, as further set forth in a Pledge and Security Agreement, dated January 19, 2021, by and among our Principal Stockholder, the Guarantors and U.S.

Bank National Association, as the notes agent.

Director Independence

Our Nominating and Corporate Governance Committee and our board of directors have conducted their annual review of the independence of each director nominee under the applicable Nasdaq and SEC independence standards.

Based upon the Nominating and Corporate Governance Committee’s recommendation and the board’s own review and assessment, our board of directors has concluded in its business judgment that each of Gary Briggs, Christy Lake, R.

Michael Mohan and Sabrina Simmons is “independent” as defined under the Nasdaq rules and Rule 10A-3 under the Exchange Act.

Principal Accounting Fees and Services.

The following is a summary of Ernst & Young LLP’s fees for professional services rendered to us for the 2020 and 2019 fiscal years.

(in millions)

Fiscal 2020 (1)

Fiscal 2019 (1)

Audit Fees (1)

Audit-Related Fees

All Other Fees

Audit fees represent fees for professional services provided in connection with the audit of our financial statements and review of our quarterly financial statements and audit services provided in connection with other statutory or regulatory filings, and additional work performed in connection with the company’s initial public offering.

Audit fees billed in fiscal 2020 included fees for the audits of our fiscal 2020, fiscal 2019 and fiscal 2018 financial statements.

Pre-Approval of Audit and Non-Audit Services Policy

In connection with our initial public offering, the Audit Committee adopted a policy for pre-approving all audit and permitted non-audit services provided by Ernst & Young LLP.

The Audit Committee annually pre-approves a list of specific services and categories of services, subject to a specified cost level.

Part of this approval process includes making a determination as to whether permitted non-audit services are consistent with the SEC’s rules on auditor independence.

The Audit Committee has delegated authority to the chair of the Audit Committee to pre-approve audit and non-audit services in amounts up to $500,000 (1) per engagement, (2) per additional category of services, or (3) to the extent otherwise required under the policy, for services exceeding the pre-approved budgeted fee levels for the specified service.

All of the services and fees identified in the table above were approved in accordance with SEC and PCAOB requirements and, following our initial public offering, pursuant to the pre-approval policy described in this paragraph.

Exhibits, Financial Statement Schedules.

2 unchanged sentences

Financial Statement Schedules

Schedule I — Parent Company Condensed Financial Information beginning on page 95 is incorporated herein by reference and should be read in conjunction with the Financial Statements included in this Item 15.

Not applicable .

Exhibit Index

8 unchanged sentences

and Scooby Aggregator, LP (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K, filed on January 19, 2021)

Description of Securities registered pursuant to Section 12 of the Exchange Act

Description of Securities registered pursuant to Section 12 of the Exchange Act (incorporated by reference to Exhibit 4.3 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

Petco Health and Wellness Company, Inc.

3 unchanged sentences

Form of Indemnification Agreement for Directors and Certain Officers (incorporated by reference to Exhibit 10.2 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Employment Agreement between Petco Animal Supplies, Inc.

and Ronald Coughlin, Jr.

dated June 4, 2018 (incorporated by reference to Exhibit 10.3 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Amended and Restated Employment Agreement between Petco Animal Supplies Stores, Inc., Petco Health and Wellness Company, Inc., and Ronald Coughlin, Jr.

8 unchanged sentences

Employment Letter between Petco Animal Supplies Stores, Inc.

and Michelle Bonfilio dated October 3, 2018 (incorporated by reference to Exhibit 10.8 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Employment Letter between Petco Animal Supplies Stores, Inc.

and Ilene Eskenazi dated July 20, 2020

and Ilene Eskenazi dated July 20, 2020 (incorporated by reference to Exhibit 10.11 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

Form of Common Series C Unit Award Agreement (incorporated by reference to Exhibit 10.11 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Retention Bonus Agreement between Petco Animal Supplies Stores, Inc.

and Michelle Bonfilio dated April 1, 2020 (incorporated by reference to Exhibit 10.12 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Second Amended and Restated Special Retention Bonus Agreement between Petco Animal Supplies Stores, Inc., Petco Health and Wellness Company, Inc., and Michael Nuzzo dated December 3, 2020 (incorporated by reference to Exhibit 10.13 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

11 unchanged sentences

2021 Equity Incentive Plan (incorporated by reference to Exhibit 99.7 of the Company’s Registration Statement on Form S-8, filed on January 19, 2021)

Term Loan Credit Agreement, dated as of January 26, 2016, among Pet Acquisition Merger Sub LLC, as initial borrower, Petco Animal Supplies, Inc., as successor borrower, the Lenders party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.14 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Revolving Credit Agreement, dated as of January 26, 2016, among Pet Acquisition Merger Sub LLC, as initial borrower, Petco Animal Supplies, Inc., as successor borrower, the Lenders party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.15 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Term Loan Guarantee and Collateral Agreement, dated as of January 26, 2016, among Pet Acquisition Merger Sub LLC, as initial borrower, Petco Animal Supplies, Inc., as successor borrower, each other Grantor party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.16 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

ABL Guarantee and Collateral Agreement, dated as of January 26, 2016, among Pet Acquisition Merger Sub LLC, as initial borrower, Petco Animal Supplies, Inc., as successor borrower, each other Grantor party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.17 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Intercreditor Agreement, dated as of January 26, 2016, among Citibank, N.A., as ABL Agent and Initial Term Loan Agent, Pet Acquisition Merger Sub LLC, as the initial borrower under the Initial Term Loan Credit Agreement and the ABL Credit Agreement, Petco Animal Supplies, Inc., as the borrower under the Initial term Loan Credit Agreement and the ABL Credit Agreement, and each subsidiary of Petco Holdings, Inc.

that is a party thereto (incorporated by reference to Exhibit 10.18 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

First Amendment Agreement, dated as of June 17, 2016, to the Term Loan Credit Agreement, dated as of January 26, 2016, among, inter alios, Petco Holdings, Inc.

LLC (f/k/a Petco Holdings, Inc.), Petco Animal Supplies, Inc., the Lenders from time to time party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.19 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

Second Amendment Agreement, dated as of January 27, 2017, to the Term Loan Credit Agreement, dated as of January 26, 2016 (as amended by the First Amendment Agreement, dated as of June 17, 2016), among, inter alios, Petco Holdings, Inc.

LLC (f/k/a Petco Holdings, Inc.), Petco Animal Supplies, Inc., the Lenders from time to time party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.20 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

First Amendment Agreement, dated as of August 23, 2018, to the Revolving Credit Agreement, dated as of January 26, 2016, among, inter alios, Petco Holdings, Inc.

LLC (f/k/a Petco Holdings, Inc.), Petco Animal Supplies, Inc., the Guarantor signatories thereto, the Lenders from time to time party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.21 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

First Lien Credit Agreement, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., the Lenders party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed on March 5, 2021)

ABL Revolving Credit Agreement, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., the Lenders party thereto, and Citibank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed on March 5, 2021)

ABL Guaranty, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., as Borrower, the Guarantors from time to time party thereto, and Citibank, N.A., as Administrative Agent

ABL Guaranty, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., as Borrower, the Guarantors from time to time party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.31 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

First Lien Guaranty, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., as Borrower, the Guarantors from time to time party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.32 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

ABL Security Agreement, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., as Borrower, the Grantors from time to time party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.33 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

First Lien Security Agreement, dated March 4, 2021, by and among Petco Health and Wellness Company, Inc., as Borrower, the Grantors from time to time party thereto, and Citibank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.34 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

Intercreditor Agreement, dated March 4, 2021, by and among Citibank, N.A., as Revolving Credit Collateral Agent, Citibank, N.A., as Initial Term Loan Collateral Agent, as acknowledged and agreed by Petco Health and Wellness Company, Inc., and the Grantors party thereto (incorporated by reference to Exhibit 10.35 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021)

List of Subsidiaries (incorporated by reference to Exhibit 21.1 of the Company’s Registration Statement on Form S-1, filed on December 3, 2020)

6 unchanged sentences

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Filed herewith.

Executive compensation plan or agreement required to be filed as an exhibit hereto.

Furnished herewith and not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

Management contract or compensatory plan or arrangement.

Form 10-K Summary

1 unchanged sentence

P etco Health and Wellness Company, Inc.

April 5, 2021

March 24, 2022

/s/ Ronald Coughlin, Jr.

6 unchanged sentences

(principal executive officer)

April 5 , 2021

/s/ Michael Nuzzo

Michael Nuzzo

Chief Financial Officer and Chief Operating Officer

March 24, 2022

/s/ Brian LaRose

Chief Financial Officer

(principal financial and accounting officer)

April 5 , 2021

March 24, 2022

/s/ Maximilian Biagosch

Maximilian Biagosch

April 5 , 2021

March 24, 2022

/s/ Cameron Breitner

Cameron Breitner

April 5 , 2021

March 24, 2022

/s/ Gary Briggs

April 5 , 2021

March 24, 2022

/s/ Nishad Chande

Nishad Chande

April 5 , 2021

March 24, 2022

/s/ Christy Lake

April 5 , 2021

March 24, 2022

Michael Mohan

April 5 , 2021

March 24, 2022

/s/ Jennifer Pereira

Jennifer Pereira

April 5 , 2021

March 24, 2022

/s/ Sabrina Simmons

April 5 , 2021

March 24, 2022

Sabrina Simmons

/s/ Christopher J.

April 5 , 2021

March 24, 2022

Christopher J.

/s/ Mary Sullivan

April 5 , 2021

March 24, 2022

Mary Sullivan

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures