Krispy Kreme’s board of directors rewarded Michael Tattersfield for his seven-year term as president and chief executive by making him eligible for stock awards valued at $7.9 million during fiscal 2023.
As a result, Tattersfield’s total compensation rose from $2.1 million in fiscal 2022 to $10.2 million in fiscal 2023, the company reported in a regulatory filing Wednesday.
Tattersfield stepped down from Krispy Kreme on Dec. 31. He took over in January as chairman of Panera Bread Inc., a JAB Holding Co. affiliate along with Krispy Kreme.
Josh Charlesworth was promoted from global president and chief operating officer to succeed Tattersfield in both roles, effective Jan. 1.
Tattersfield is perhaps best known locally for his 2018 decision to move the company’s corporate headquarters to south Charlotte after 81 years in Winston-Salem, where the company was founded.
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Krispy Kreme’s provision of stock and stock-option awards have swung wildly the past three fiscal years.
Stock- and stock-option awards are valued in the annual corporate proxy filings on the day they are awarded by the company.
Although federal regulators require corporations to declare the value annually, executives typically are required to wait a specified amount of time — often one to three years — to receive those shares or exercise the options.
The prevailing theory is that executives will be more inclined to be prudent with shareholder value, potentially taking less risk, if their own compensation is weighted primarily toward share-price performance.
In fiscal 2021, the board vaulted Tattersfield into the upper levels of corporate executive compensation for at least one fiscal year with stock awards valued at $8.5 million and stock-option awards valued at $7.5 million, both on the date they were awarded.
Those were the key factors in Tattersfield’s fiscal 2021 compensation ballooning to $23.5 million.
Other members of the company’s executive-management team received proportionally similar stock and stock-option awards in fiscal 2021.
However, the company substantially shrank those awards in fiscal 2022, including Tattersfield receiving stock awards valued at $999,998 and no stock-option awards.
Tattersfield’s base salary was unchanged at $1.1 million. He received $1.1 million in incentive pay after no incentive pay in 2022.
All other compensation was $43,259, which consisted of $40,421 for personal air travel expenses and $2,838 for group life insurance premiums.
For fiscal 2023 a major income-tax expense taken in the third quarter contributed to a $37.9 million loss. Krispy Kreme reported income-tax expense of $50.3 million for the full year. Full-year revenue was up 10.2% at $1.6 billion.
Because of the substantial changes in the value of stock awards, the CEO pay ratio for Tattersfield was $460-to-$1 based on a median global employee compensation of $22,283. The ratio was $867-to-$1 in 2021 and $122-to-$1 in 2022.
Other key executives
The uptick in the value of stock and stock-option awards also drove up 2023 compensation for Krispy Kreme’s five other named executives.
Charlesworth, in his global president and chief operating officer duties, received $950,000 in base salary — up 10.5% — as well as incentive pay of $737,200, stock awards valued at $9.4 million (up from $500,006 in 2022), and total compensation of $11.1 million, compared with $1.3 million in 2022.
Krispy Kreme said in January that Charlesworth would be paid a base salary of $1 million in his new roles. He would be made eligible to receive a performance-based bonus representing 100% to 200% of his base salary.
Jeremiah Ashukian, who took over in January 2023 as chief financial officer, was listed for the first time. He was paid $650,000 in base salary, a $675,000 bonus, incentive pay of $504,400, stock- and stock-option awards valued at $4.4 million and total compensation of $6.4 million.
Matthew Spanjers, chief growth officer, received a 14.% raise in base salary to $600,000 in base salary, incentive pay of $465,600, stock awards valued at $2.7 million, and total compensation of $3.8 million, compared with $1.04 million in 2022.
Raphael Duvivier, chief development officer, also was listed for the first time. She was paid $413,304 in base salary, $293,219 in incentive pay, stock awards valued at $2.3 million and total compensation of $3.1 million.
Krispy Kreme will conduct its 2024 shareholders meeting virtually at 10 a.m. June 18. There are no shareholder proposals on the agenda.