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Message: [QUOTE="Bombastus, post: 91525, member: 2178"] Heidi O’Neill started as Lululemon CEO on September 8, 2026, with an initial annual base salary of $1.4 million. Her employment deal makes clear, though, that salary is only the smallest visible piece of the package. Her annual target bonus is set at 200 percent of base salary, which works out to $2.8 million at the initial rate. For fiscal 2026, the maximum payout can reach 200 percent of target, or $5.6 million before proration, if the required performance conditions are met. The timing of [B][URL='https://goldmidi.com/community/threads/heidi-o%E2%80%99neill-left-the-spotify-board-ahead-of-the-lululemon-ceo-role.76914/']her Spotify board exit before taking over Lululemon[/URL][/B] matters here because her first bonus opportunity and annual equity award are prorated from September 8. Adding every headline number together and calling it her 2026 pay would give you a distorted figure. [HEADING=2]The $10 million annual equity award carries the weight[/HEADING] Each year, O’Neill is eligible for equity awards worth about $10 million, subject to compensation committee approval. Sixty percent is designated for performance-vesting restricted stock units, while the remaining 40 percent comes through stock options. The distinction matters because neither piece behaves like salary. Performance units depend on the company meeting the applicable conditions, while options become more valuable when the share price rises above the exercise price and can lose practical value when it does not. Her fiscal 2026 annual equity opportunity is also prorated because she joined late in the year. Lululemon therefore did not promise a full $10 million annual grant for the shortened opening period, even though the continuing annual opportunity is set at roughly that level. O’Neill also received a separate one-time equity package with a stated grant-date value of $7 million. It is split between $4.2 million in stock options and $2.8 million in time-vesting restricted stock units, with half of each award scheduled to vest after one year and the other half after two years. Her old Nike base salary provides useful perspective on the cash figure. Nike reported a $1.25 million base salary for O’Neill in fiscal 2025, so the move to Lululemon lifted the stated annual salary by $150,000 rather than producing the dramatic cash jump the wider package might suggest. [HEADING=2]The $2 million retention payment comes with strings[/HEADING] Lululemon also agreed to a [B]two-year retention cash payment[/B] of $2 million, payable on the next regular payroll date after O’Neill started. The money is tied directly to her remaining employed for 24 months from September 8. If she resigns without good reason or is fired for cause before completing those 24 months, she must repay a prorated after-tax portion. The repayment falls as more of the retention period is completed, so the agreement treats the payment as something earned over time rather than an unconditional signing gift. Other exits are handled differently. If her employment ends for another reason after she has started, the retention amount is treated as fully earned under the agreement, which makes the precise reason for departure financially important. The contract also gives O’Neill substantial protection if Lululemon terminates her without cause or if she leaves for defined good reason. She is entitled to 24 months of base salary or notice, which equals $2.8 million at the initial salary rate if the company chooses payment instead of working notice. Equity treatment is unusually important in the same section. In those qualifying circumstances, outstanding awards receive the contract’s retirement treatment, which provides full vesting without proration, while performance-based awards still depend on actual performance and are paid on the normal timetable. [HEADING=2]Cross-border terms quietly add more value[/HEADING] O’Neill is primarily based at Lululemon’s Vancouver headquarters, and the agreement addresses the tax friction created by the move. For the 2026 tax year, her tax on cash compensation is calculated as though she had remained living and working only in Oregon for US federal and Oregon income-tax purposes. Lululemon covers taxes above that reference amount, with a later reconciliation after her US and Canadian returns are completed. It is a narrow benefit tied to 2026 cash compensation, but it prevents the first year’s cross-border tax position from quietly reducing the value of the deal. The company also agreed to provide relocation benefits and to pay the costs and reasonable expenses required for her Canadian work authorization. Security services may be provided at company expense when reasonably required and approved, while Canadian tax preparation and accounting support can continue during certain post-employment payment or equity periods. One final clause shapes how the equity can age with her tenure. O’Neill becomes eligible for the agreement’s retirement treatment after at least three years of service once her age plus completed years at Lululemon totals 65, giving long-held awards a more favorable path if she eventually retires under those conditions. [/QUOTE]

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