Brian Niccol will likely receive a handsome salary if he becomes CEO of Starbucks.
Starbucks said in a filing with the Securities and Exchange Commission on Wednesday that it plans to pay Nicol an initial base salary of $1.6 million per year.
Details of his compensation package, which includes other incentives and company performance requirements, were revealed a day after Starbucks said Lakshman Narasimhan was stepping down and the former Chipotle CEO would lead the coffeehouse chain from Sept. 9.
In addition to his salary, Starbucks has agreed to pay Nicol a $10 million signing-on bonus “in consideration of cash incentive opportunities that he will forfeit from his current employer and stock that will vest within approximately the next six months.”
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In connection with the waiver of his Chipotle stock-based compensation, the company will give him a “replacement stock grant” worth $75 million, which “consists of 60% performance-based restricted stock units and 40% time-based restricted stock units,” according to the filing.
The Starbucks contract also includes eligibility to receive annual cash bonuses and stock awards.
Starbucks said annual cash bonuses will be “targeted at 225% of base salary, with a maximum of 450% of base salary, pro-rated in fiscal year 2024.”
According to the filing, Nicol will be eligible to receive stock-based compensation that could reach $23 million per year starting next fiscal year.
The company said he will take on the role of CEO in early September and will also become chairman of Seattle-based Starbucks.
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The offer letter Starbucks included in its SEC filing stated that Nicol “will not be required to relocate” to Seattle and that he agreed to “commute from his home to the company’s headquarters (and undertake other travel)” as necessary to perform his duties and responsibilities.
Nicol led California-based Chipotle for about six years.
“While it is difficult to leave such a great company and the talented people I have had the opportunity to work with, I leave knowing that the business is strong and poised for growth with a strong, experienced leadership team,” he said in a Chipotle press release announcing his departure from the fast-food chain.
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In a separate statement, he expressed his excitement about joining Starbucks.
“I have long admired Starbucks’ iconic brand, unique culture and commitment to strengthening connections between people around the world,” said Nicol. “As we embark on this journey, I am inspired by the tremendous potential to drive growth and further elevate the Starbucks experience for our customers and partners while staying true to our mission and values.”
