Mr. Peter
J. Bocian
1024 Whispering Pines Lane
Dayton, OH 45458
I am pleased to
offer you the position of executive vice president and cfo
designate reporting to me at Starbucks Corporation, subject to
approval by the Board of Directors. As a new partner, you have the
opportunity to help create a legacy through your valuable
contributions and you will soon be participating in various classes
and immersion activities that will provide you information about
Starbucks history, coffee, and culture. I value your passion for
the organization and look forward to you joining the team on
May 14, 2007.
In order to
allow time for you to complete your immersion before assuming the
full responsibilities of chief financial officer, you will join
Starbucks as executive vice president and cfo designate and remain
in that role until October 1, 2007. At that time you will
assume the role of executive vice president, chief financial
officer, and chief administrative officer. You will report to me in
both roles.
Here are the
specifics of your offer:
You will be
paid bi-weekly at a base salary that annualizes to
$575,000.
You are
guaranteed a one-time sign-on bonus of $500,000 less payroll taxes
paid in full 30 days after your start date. Please note,
should you voluntarily leave Starbucks during your first year of
employment, you will be responsible for reimbursing Starbucks for a
pro-rata gross share (n/12 based on number of months worked) of the
one-time sign-on bonus you received. Your sign-on bonus is not
eligible pay for purposes of making contributions into Starbucks
savings plan.
Sign-On
Stock Option Grant
You will be
granted stock options to purchase 200,000 shares of Starbucks
common stock under the Key Employee Sub-Plan to the 2005 Long-Term
Equity Incentive Plan, subject to formal approval by the
Compensation and Management Development Committee of the
Pete Bocian
March 29, 2007
Page 2
Board of
Directors. The exercise price of the options will be the regular
trading session closing price of a share of Starbucks stock on the
date of the grant. The grant date of your options will be effective
in accordance with the Company’s option grant policy. The
options will be non-qualified and will vest in equal installments
over a period of four (4) years, beginning on the first
anniversary date of the grant, subject to your continued
employment.
For fiscal year
2007, your bonus will be guaranteed at a minimum 100% payout of
$287,500 under the General Management Incentive Plan. For fiscal
year 2008, you will participate in the Executive Management Bonus
Plan for the full year. Your incentive target is 50% of your
eligible base salary. This incentive is based on achievement of
company, business unit/department, and individual performance
goals. We will provide you with more information about the bonus
plans and a copy of the plan documents. Starbucks reserves the
right to review, change, amend, or cancel incentive plans at any
time.
You will be
granted stock options to purchase shares of Starbucks common stock
with an economic value of $1,000,000 (USD) under the Key
Employee Sub-Plan to the 2005 Long-Term Equity Incentive Plan,
subject to approval by the Compensation and Management Development
Committee and the Board of Directors when it approves the
Company’s regular annual stock option grants in fiscal 2008.
The annual grant occurs on the second business day after the
Company releases its fiscal year-end earnings ( i.e. ,
currently expected to be on or about November 19, 2007). The
exercise price of the options will be the regular trading session
closing price of a share of Starbucks stock on the date of the
grant. The options will be non-qualified and will vest in equal
installments over a period of four (4) years, beginning on the
first anniversary date of the grant, subject to your continued
employment. As an executive, you are not eligible for stock option
grants under the Company-Wide Stock Option Plan (commonly referred
to as “Bean Stock” ).
As an
executive, with access to sensitive business and financial
information about the Company, you will be prohibit
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