Best Buy Co. Inc. disclosed compensation arrangements Tuesday for new CEO Hubert Joly, who was hired away from privately held Carlson, the travel and hospitality firm he's led as CEO since 2008.
Best Buy Co. Inc. disclosed compensation arrangements Tuesday for new CEO Hubert Joly, who was hired away from privately held Carlson, the travel and hospitality firm he's led as CEO since 2008. Documents filed with the Securities and Exchange Commission show Joly will receive:
Signing bonus: $20 million. Best Buy will pay Joly a $3.5 million lump sum and a $3 million stock grant. In addition, he will be get a $6 million restricted stock award; a $3.75 million stock options award, and $3.75 million in performance share units for what he may have forfeited by leaving Carlson. (The ultimate value of restricted stock, stock options and performance units will be determined by how well the company and the stock perform.)
Base salary: $1.175 million per year. That's comparable to interim CEO G. "Mike" Mikan's base salary rate and former CEO Brian Dunn's last annual salary of $1.1 million.
Annual bonus: For the 2014 fiscal year starting Feb. 1, 2013, Joly will be eligible for an annual bonus of 200 percent to 400 percent of his base salary depending on company performance, or $2.35 million to $4.7 million.
Long-term incentive compensation: $8.75 million. Joly will be eligible for a long-term incentive plan award of not less than $8.75 million starting in fiscal 2014.
Contingencies: If Joly is terminated in a change of control (for example, if founder and former CEO Richard Schulze succeeds in his buyout plan), Joly would get a severance of two times his annual salary plus a target bonus, a pro-rated annual bonus based on the company's actual performance, and his performance share units would be paid out.
If Joly, a French citizen, is unable to obtain work authorization in the United States to enable him to join Best Buy, he would be eligible for a $6.25 million payment from Best Buy.