Robert Nardelli Resigns as Chairman and Chief Executive Officer of The Home Depot and Is Succeeded by Frank Blake

Jan 03, 2007, 00:00 ET from The Home Depot

    ATLANTA, Jan. 3 /PRNewswire-FirstCall/ -- The Board of Directors of The
 Home Depot(R) and Bob Nardelli announced today that they have mutually
 agreed that Nardelli would leave his position as The Home Depot's chairman,
 president & CEO and as a Director effective January 2, 2007. Frank Blake,
 the Company's current vice chairman of the Board of Directors and executive
 vice president succeeds Nardelli, effective immediately.
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     The Home Depot's Board said, "We are very grateful to Bob for his
 strong leadership of The Home Depot over the past six years. Under Bob's
 tenure, the Company made significant and necessary investments that greatly
 improved the Company's infrastructure and operations, expanded our markets
 to include wholesale distribution and new geographies, and undertook key
 strategic initiatives to strengthen the company's foundation for the
 future. The Home Depot has delivered strong and consistent growth and
 gained market share under Bob's leadership, and we believe that the Company
 is well positioned to continue to do so. We thank Bob for his
 contributions, hard work and dedication and wish him all the best in his
 future endeavors."
     Frank Blake was elected chairman and CEO of The Home Depot and a full
 voting member of the Board of Directors.
     "The entire Board is pleased to name Frank as The Home Depot's Chairman
 and Chief Executive Officer. We are fortunate to have someone of Frank's
 caliber within our organization and believe he is the ideal candidate to
 succeed Bob," continued the Board of Directors. "While industry conditions
 remain challenging, we are confident that Frank will effectively execute on
 the Company's strategy, build upon our legacy of growth, innovation and
 superior customer service, and deliver value for our shareholders."
     Since joining The Home Depot in 2002, Blake has served as vice chairman
 of the Board of Directors and executive vice president. His
 responsibilities have included strategic business development, growth
 initiatives, real estate, store construction, credit services, and the Home
 Services business. Prior to joining The Home Depot, Blake served as deputy
 secretary for the U.S. Department of Energy (DOE). Prior to that, he served
 in a variety of executive roles at General Electric, including senior vice
 president, Corporate Business Development.
     "I am honored to lead this exceptional company and build on Bob's
 significant achievements. The Home Depot has a strong core business and
 exciting opportunities in its adjacent businesses. I believe that the
 Company continues to have tremendous potential for growth and that we have
 an exciting future ahead of us," said Frank Blake.
     "The Board and I are committed to continuing on our current strategic
 path and remain focused on enhancing performance and delivering value for
 customers, shareholders and associates."
     The Board also announced that Carol Tome, the Company's current
 executive vice president and CFO, and Joe DeAngelo, the Company's executive
 vice president, HD Supply, will be assuming additional responsibilities.
 Tome will be assuming responsibility for mergers and acquisitions, credit
 services and additional strategic responsibilities. DeAngelo was appointed
 to the newly created position of Chief Operating Officer. In this position,
 DeAngelo will continue to oversee HD Supply and will assume additional
 responsibilities for the retail business.
     "I am extremely proud of what we have accomplished at The Home Depot
 since 2000 and I believe that I leave a stronger and more resilient company
 than when I arrived, and one that is well positioned to capitalize on the
 substantial opportunities ahead of it," said Nardelli. "I've worked closely
 with Frank, Joe and Carol and have the utmost confidence in their
 abilities. I have also been lucky to work with a very talented and
 dedicated management team, which will support Frank, Carol and Joe in the
 next phase of The Home Depot's strategy. I wish The Home Depot and all of
 its associates continued success in the future."
     With the appointments of Blake, DeAngelo and Tome, the Board of
 Directors expressed its confidence in the Company's current business model,
 long-term strategy and future growth potential.
     Nardelli and the Company have agreed in principle to the terms of a
 separation agreement which would provide for payment of the amounts he is
 entitled to receive under his pre-existing employment contract entered into
 in 2000. Under this agreement, Nardelli will receive consideration
 currently valued at approximately $210 million (including amounts which
 have previously been earned or vested). This consideration will include a
 cash severance payment of $20 million, the acceleration of unvested
 deferred stock awards currently valued at approximately $77 million and
 unvested options with an intrinsic value of approximately $7 million, the
 payment of earned bonuses and long-term incentive awards of approximately
 $9 million, the payment of account balances under the Company's 401(k) plan
 and other benefit programs currently valued at approximately $2 million,
 the payment of previously earned and vested deferred shares with an
 approximate value of $44 million, the payment of the present value of
 retirement benefits currently valued at approximately $32 million and the
 payment of $18 million for other entitlements under his contract which will
 be paid over a four year period and will be forfeited if he does not honor
 his contractual obligations.
     Nardelli has also agreed not to compete with the Company for one year,
 not to solicit employees or customers of the Company for four years and
 other restrictive covenants.
     In conjunction with the management changes, the Board of Directors also
 announced that it had waived the retirement age of 72 and has asked John L.
 Clendenin, Claudio X. Gonzales and Milledge A. Hart III to stand for re-
 election at the 2007 annual shareholders meeting. This action was taken to
 retain these directors' experience, and deep knowledge of the Company's
 business and key personnel to help ensure a smooth management transition.
 This action is temporary and effective for one year.
     About The Home Depot
     The Home Depot is the world's largest home improvement specialty
 retailer, with 2,127 retail stores in all 50 states, the District of
 Columbia, Puerto Rico, U.S. Virgin Islands, 10 Canadian provinces, Mexico
 and China. Through its HD Supply(SM) businesses, The Home Depot is also one
 of the largest diversified wholesale distributors in the United States,
 with nearly 1,000 locations in the United States and Canada offering
 products and services for building, improving and maintaining homes,
 businesses and municipal infrastructures. In fiscal 2005, The Home Depot
 had sales of $81.5 billion and earnings of $5.8 billion. The Company
 employs approximately 355,000 associates and has been recognized by FORTUNE
 magazine as the No. 1 Most Admired Specialty Retailer and the No. 13 Most
 Admired Corporation in America for 2006. The Home Depot's stock is traded
 on the New York Stock Exchange (NYSE:   HD) and is included in the Dow Jones
 industrial average and Standard & Poor's 500 index. HDG
     Forward Looking Statements
     Certain statements contained herein may be "forward-looking statements"
 as defined in the Private Securities Litigation Reform Act of 1995. These
 statements are based on currently available information as of their dates
 and are subject to risks and uncertainties that may cause actual results to
 differ materially from the statements and other information contained
 herein, including risks and uncertainties associated with the effects of
 the changes in management personnel.
     Additional information regarding risks and uncertainties is contained
 in the Company's periodic filings with the Securities and Exchange
 Commission, including the Company's most recently filed Annual Report on
 Form 10-K. Forward-looking statements speak only as of their respective
 dates, and the Company specifically disclaims any obligation to update them
 except as may be required under the federal securities laws.

SOURCE The Home Depot