8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 8, 2018

Starbucks Corporation

(Exact name of registrant as specified in its charter)

Washington	0-20322	91-1325671
(State of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2401 Utah Avenue South, Seattle, Washington 98134

(Address of principal executive offices) (Zip Code)

(206) 447-1575

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).

Emerging Growth Company    ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐

Item 5.02    Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On October 8, 2018, Starbucks Corporation (the “Company”) announced the appointment of Patrick J. Grismer as executive vice president, chief financial officer, effective November 30, 2018. In this capacity, Mr. Grismer will serve as the Company’s principal financial officer and principal accounting officer, effective November 30, 2018. Mr. Grismer is expected to join the Company as executive vice president on November 12, 2018. As previously announced, Scott Maw will retire as chief financial officer of the Company on November 30, 2018 and will serve as a senior consultant through March 31, 2019.

Mr. Grismer, 56, has been Executive Vice President, Chief Financial Officer of Hyatt Hotels Corporation, a global hospitality company, since March 2016, where he is responsible for Hyatt’s global finance function. Mr. Grismer joined Hyatt following his post as Chief Financial Officer at Yum! Brands, Inc., a position he held from May 2012 to February 2016. He previously held a number of roles at Yum!, including Chief Planning and Control Officer and Chief Financial Officer for Yum! Restaurants International. Prior to Yum!, Mr. Grismer worked at The Walt Disney Company where he served in roles that included Vice President, Business Planning and Development for The Disneyland Resort and Chief Financial Officer for the Disney Vacation Club. Mr. Grismer began his career with Price Waterhouse. He earned CPA certification in the State of California (inactive status).

In connection with Mr. Grismer’s appointment, the Compensation and Management Development Committee of the Board of Directors of the Company approved an annualized base salary of $845,000, an annual bonus target under the Company’s Executive Management Bonus Plan of 100% of base salary, a new hire equity award of $7,500,000 and a new hire cash award of $1,500,000. The equity award will consist of time-vesting restricted stock units (“RSUs”). The RSUs will vest 40% on the first anniversary, and 30% on each of the second and third anniversaries, of the date of grant, subject to continued employment. The new hire cash award will be paid in full following 30 days of employment, subject to a one-year repayment agreement. The foregoing description is qualified in its entirety by reference to Mr. Grismer’s Offer Letter dated October  5, 2018, which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

There is no arrangement or understanding between Mr. Grismer and any other person pursuant to which Mr. Grismer was appointed. There are no family relationships, as defined in Item 401 of Regulation S-K, between Mr. Grismer and any of the Company’s executive officers or directors or persons nominated or chosen to become a director or executive officer. There are no transactions in which Mr. Grismer has an interest requiring disclosure under Item 404(a) of Regulation S-K.

Item 7.01    Regulation FD Disclosure.

A copy of the Company’s press release relating to the announcement described in Item 5.02, dated October  8, 2018, is furnished as Exhibit 99.1 to this Form 8-K.

Item 9.01    Financial Statements and Exhibits.

(d) Exhibits:

Exhibit No.	Description
10.1	Offer Letter dated October 5, 2018 between Starbucks Corporation and Patrick J. Grismer
99.1	Press Release dated October 8, 2018

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	STARBUCKS CORPORATION
Dated: October 9, 2018
	By:	/s/ Rachel A. Gonzalez
		Rachel A. Gonzalez
		executive vice president, general counsel and secretary

EX-10.1

Exhibit 10.1

October 5, 2018

Pat Grismer

2018 N. Dayton St.

Chicago, IL 60614

Dear Pat,

Congratulations! It is with great pleasure that I confirm your offer of employment for the position of evp, chief financial officer at Starbucks Corporation (“Starbucks” or “the Company”) reporting directly to me. I look forward to your first day as evp on November 12, 2018 and assuming the role of evp, chief financial officer on November 30, 2018.

As a new partner, you will soon be participating in various immersion activities that will provide you information about Starbucks history and culture.

Please note, this offer is contingent upon the approval of the Compensation and Management Development Committee of the Board of Directors (“Committee”) or its designee as well as meeting all pre-employment requirements listed on the last page of the offer.

Here Are The Specifics Of Your Offer:

Base Salary

You will be paid a base salary that annualizes to $845,000.

Sign-On Bonus

You will receive a one-time cash sign-on bonus of $1,500,000, less payroll taxes, payable on your next regularly scheduled pay period after 30 days of employment.

Please note, should you voluntarily leave Starbucks during your first year of employment, you will be responsible for reimbursing Starbucks for a pro-rata portion of the sign-on bonus and such reimbursement to be calculated as follows:

((365 - # days employed)/365) x $1,500,000

Your sign-on bonus is not eligible pay for purposes of making contributions into Starbucks savings plans. By accepting this position you agree that in the event you are responsible for reimbursing a prorated gross portion of the sign-on bonus, the amount may be deducted from your final pay, to the extent allowed by law. If the amount due exceeds that collected from the final pay, then you agree to pay the balance within 30 days after the effective termination date of employment with Starbucks.

Sign-On Equity Award

You will receive an equity award with an economic value of $7,500,000 (USD) under the 2005 Key Employee Sub-Plan to Starbucks Corporation Amended and Restated 2005 Long-Term Equity Incentive Plan (the “Key Employee Plan”) with 100% in the form of restricted stock units.

The grant date for your equity awards will be after you assume your new position and otherwise effective in accordance with the Company’s equity grant timing guidelines. Subject to your continued employment, the restricted stock units will vest 40% in year 1, 30% in year 2 and 30% in year 3 beginning on the first anniversary of the grant date.

To ensure processing of this grant, please sign this offer letter and email a copy to Stock Administration at stockadm@starbucks.com.

Executive Management Bonus Plan

You will be eligible to participate in the Executive Management Bonus Plan (EMBP) in fiscal 2019. Your incentive target will be 100% of your eligible base salary, prorated from your eligibility date through the end of fiscal 2019. For more information about the EMBP please talk with your Partner Resources contact. Starbucks reserves the right to review, change, amend, or cancel incentive plans at any time.

Long-Term Incentives

Starbucks Total Rewards philosophy includes long-term incentives. Each year, as determined by the Committee, you may be eligible to receive an equity award under the Leadership Stock Plan with 60% of the economic value in the form of performance restricted stock units and 40% of the economic value in the form of time-based restricted stock units. Annual awards are typically granted in November and are contingent upon Committee approval after considering a number of factors. You will be eligible for an annual long-term incentive award starting in fiscal 2020 (with an expected grant sometime in November 2019). Starbucks reserves the right to review, change, amend, or cancel long-term incentive plans at any time.

Stock Ownership

As a senior executive, the Company’s executive stock ownership guidelines will apply to you. The guidelines require covered executives to achieve a minimum investment in Starbucks stock within five (5) years. Your minimum investment as evp, chief financial officer is three (3) times your annual base salary. A copy of the guidelines will be provided to you.

Management Deferred Compensation Plan

Eligibility for the Management Deferred Compensation Plan (MDCP) is limited to certain partners on Starbucks (or a participating affiliate’s) U.S. payroll who are in the position of director level or above. The MDCP is a non-qualified deferred compensation plan that provides eligible partners with the opportunity to save a portion of their eligible pay on a pre-tax basis. If you are eligible, you will receive enrollment information at your home address as soon as administratively possible after your start date. These materials will outline the limited window in which you will have an opportunity to enroll. If you have questions about the MDCP, please contact the Starbucks Savings Team at savings@starbucks.com. Once eligible, you may also obtain more information about the MDCP online at netbenefits.fidelity.com.

If you are determined to be eligible to enroll during the MDCP open enrollment period between November 25 and December 18. Any amount that you elect to deferwill be subject to the terms and conditions of the MDCP.

Relocation Benefits

You will be eligible for relocation benefits if you accept our offer of employment. Starbucks wants your move to the Seattle, Washington area to be a positive one. Our relocation provider will support your relocation.

Your relocation benefits will be determined after you complete an assessment call with a consultant from our relocation provider. After the completion of the assessment, you will be provided with an outline of the relocation benefits that will be offered to you. Relocation benefits will not be authorized until you accept our offer of employment. Once accepted, a relocation consultant will then contact you to begin the process. You will be required to sign the Partner Relocation Repayment Agreement and return it to your relocation consultant before relocation benefits will be administered. If you have any questions in the interim, please consult your Starbucks Partner Resources contact.

401(k)

The Future Roast 401(k) Savings Plan provides eligible partners with the opportunity to save on a 401(k) pre-tax as well as a Roth after-tax basis, and to receive Starbucks Match of 100% on the first 5% of eligible pay (subject to IRS imitations) contributed each pay period. Partners will be able to enroll online at netbenefits.fidelity.com or by phone by calling Fidelity at (866) 697-1048 starting approximately 75 days prior to attainment of Plan eligibility (90 days of employment, age 18 and on the Starbucks or a participating affiliate’s U.S. payroll). Payroll contributions will start within one to two pay periods after you enroll or the date you meet the Plan’s eligibility requirements. Fidelity will mail a welcome letter containing enrollment instructions and information to your home shortly before you are expected to meet the eligibility requirements if you have not yet enrolled. These materials will outline the specific Plan provisions including eligibility for and crediting of the employer matching contributions. If after meeting the eligibility requirements, you do not receive the welcome letter, or if you have any questions about the Future Roast 401(k) Savings Plan, please contact the Starbucks Savings team via email at savings@starbucks.com. Once you are eligible to enroll, you may obtain more information about the Plan online at netbenefits.fidelity.com.

COBRA

Should you elect COBRA (continuation of health coverage) from your previous employer, Starbucks will reimburse you for your COBRA premiums less applicable taxes until you become eligible for Starbucks benefits after the mandatory waiting period. Once you have signed up for COBRA coverage (within the 60-day election period), submit proof of payment(s) to your Partner Resources contact for processing. The proof of payment must be submitted for reimbursement within 60 days of your Starbucks benefit eligibility date. The reimbursement is classified as income by the federal government and is subject to all applicable payroll taxes and deductions.

Executive Life Insurance

As an executive, you and your family have a greater exposure to financial loss resulting from your death. Starbucks recognizes this exposure and has provided for coverage greater than outlined in Your Special Blend. You will receive partner life coverage equal to three (3) times your annualized base pay, paid for by Starbucks. You may purchase up to an additional two (2) times your annualized base pay (for a total of five (5) times pay) to a maximum life insurance benefit of $2,000,000.

Executive Physical Exam

You are eligible to participate in Starbucks executive physical program. Information about the program and our program provider will be emailed to you (new participants are notified at the beginning of each calendar quarter). The program provider will contact you shortly thereafter to establish an appointment. If you have questions about this physical, please consult your Partner Resources contact.

Insider Trading

You will be prohibited from trading Starbucks securities (or, in some circumstances, the securities of companies doing business with Starbucks) from time to time in accordance with the Company’s Insider Trading Policy. A copy of the policy will be provided to you on your first day and you will be required to complete an online training and certify that you have read and understood the policy.

Coffee and Dairy Hedging

As an officer of the Company you are prohibited from trading in coffee or dairy futures, options or similar instruments for your own account. If you have further questions, please consult your Partner Resources contact.

An overview of Starbucks benefits, savings and stock programs can be found at http://www.starbucks.com/ysb. If you have questions regarding these programs or eligibility, please call the Starbucks Benefits Center at (877) SBUXBEN. Please note that although it is Starbucks intent to continue these plans, they may be amended or terminated at anytime without notice.

All Starbucks partners in the State of Washington are required to have their pay electronically deposited in a bank or financial institution of their choice within the United States or electronically loaded on a paycard. The deposits may be made to your checking, savings, paycard, or money market account or a combination thereof. Please be prepared to fill out the necessary automatic deposit information during your first week of employment with the company.

If you accept this offer it is contingent on the following conditions of hire including:

• Employment Eligibility Verification; proof of eligibility to work in the United States (All Employees)

• Background Check

• Signing a Confidentiality, Non-Solicitation and Non-Competition Agreement

• Partner Guide Acknowledgement

Your employment with Starbucks Corporation will be “at will,” meaning that either you or the Company will be entitled to terminate your employment at any time and for any reason, not prohibited by law.

On behalf of the entire team, I am excited to welcome you to Starbucks and look forward to working with you.

Warm regards,

/s/ Kevin R. Johnson

Kevin Johnson

president and ceo

Cc: Stock Administration

Executive Recruiting

Enc. MDCP Summary and Enrollment Guide

Your Special Blend

COBRA Reimbursement Information

Enrollment Guide

Future Roast 401(k) Plan Summary

Insider Trading Policy

Confidentiality, Non-Solicitation and Non-Competition Agreement

Stock Ownership Guidelines

I accept employment with Starbucks Corporation, or its wholly-owned subsidiaries, according to the terms set forth above.

/s/ Pat Grismer	10/6/2018
Pat Grismer	Date of Acceptance

Please email this signed letter to:

Stock Administration Stockadm@starbucks.com

And Executive Recruiting ExecutiveRecruiting@starbucks.com

EX-99.1

Exhibit 99.1

Starbucks Names Patrick Grismer Chief Financial Officer

SEATTLE (October 8, 2018) – Starbucks Corporation (NASDAQ: SBUX) today announced Patrick Grismer has been appointed executive vice president and chief financial officer (cfo). Reporting to Kevin Johnson, Starbucks president and chief executive officer, Grismer succeeds Scott Maw, who will retire on November 30. Maw will remain a senior consultant through March 2019 to ensure a smooth transition, with Grismer joining the company on November 12 and assuming the role of cfo on November 30.

Grismer is an accomplished finance executive, bringing to Starbucks significant leadership experience at global, consumer-facing growth companies, including more than 25 years combined at Hyatt Hotels Corporation, Yum! Brands (parent company to KFC, Pizza Hut and Taco Bell) and The Walt Disney Company.

Grismer joins Starbucks from his current position as cfo of Hyatt, which he has held since joining the company in March 2016. In this role, he was responsible for all facets of the global finance function, as well as corporate strategy, asset management, construction, procurement and shared services.

“As a seasoned cfo of multiple global, consumer-facing growth companies, Pat brings tremendous finance expertise, a customer-centric mindset and a wealth of restaurant industry experience to Starbucks,” said Kevin Johnson, Starbucks president and chief executive officer. “Pat will be a fantastic addition to the team, and I look forward to partnering with him as we continue to execute against our strategic priorities and drive strong financial performance.”

Prior to Hyatt, Grismer held a variety of leadership positions at Yum! Brands over 14 years, including cfo. Before Yum! Brands, Grismer served in a number of finance and strategy positions at The Walt Disney Company over a ten-year period, including vice president of business planning and development for The Disneyland Resort. Grismer began his career as a management consultant with Price Waterhouse.

Grismer earned a Bachelor of Science degree in Business Administration from the University of Southern California, a Master of Business Administration degree from Northwestern University’s Kellogg Graduate School of Management and became a Certified Public Accountant in the State of California.

“I am very excited to join Starbucks and feel privileged to be part of the team responsible for leading this iconic, global company. I have always admired the Starbucks brand and values, and I look forward to working with Kevin and the leadership team to help lead the company into its next phase of growth,” said Grismer.

About Starbucks

Since 1971, Starbucks Coffee Company has been committed to ethically sourcing and roasting high-quality arabica coffee. Today, with stores around the globe, the company is the premier roaster and retailer of specialty coffee in the world. Through our unwavering commitment to excellence and our guiding principles, we bring the unique Starbucks Experience to life for every customer through every cup. To share in the experience please visit us in our stores, online at Starbucks.com and through the Starbucks Newsroom.

Starbucks Coffee Company

press@starbucks.com

(206) 318 7100

Source: Starbucks Coffee Company

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