Even if he’s no longer running the company, the CEO of Ruby Tuesday will be earning more than he did last year.
James Buettgen, who joined the company in late 2012 after acting as the chief marketing officer at Darden restaurants, is likely to pull in upward of $3.3 million following his exit from the restaurant.
The Wall Street Journal reported earlier that the once-CEO was asked to resign due to poor performance, a person familiar said—making it more likely that Buettgen was ousted, and giving him a larger package that includes three times his yearly base pay.
Since Buettgen’s base pay is now $850,000, that gives the once-CEO $2.55 million. Additionally, Buettgen would also get some 272,000 in stock awards that fully vests on termination without cause, according to Brian Foley, of Brian Foley and Company, a firm that specializes in executive compensation.
At the price of Ruby Tuesday’s stock at the market’s close Wednesday, Buettgen’s stake would be worth some $770,000.
Buettgen though, does lose out in some ways. The food industry heavyweight can choose to exercise some 893,000 options—at values between $5.91 to $9.34, which will expire 90 days after Buettgen’s resignation—hardly enough time for Ruby Tuesday’s now $2.85 stock price to become profitable for the executive.
Buettgen is also eligible for a pro-rated performance-based bonus for this fiscal year—though given how Ruby Tuesday has done in the past few year, there’s unlikely to be one, said Foley.
That said, Buettgen may also get other extras in the form of health care benefits or life insurance, Foley said.
After all, CEOs are rarely left without a parachute after leaving a company. Michael Pearson, after he was ousted from Valeant, was allowed to stay on its board and was paid $83,000 a month as a consultant until the end of 2016. He was also offered an office, assistant, and continued benefits for him and his family over the next two years. Time Inc.’s recently departed CEO, Joe Ripp, is to be compensated some $5.2 million through 2018.
Shares of Ruby Tuesday have fallen dramatically since the financial crisis, as fewer people frequented casual dining establishments. Since then, the company has reported several consecutive quarters of declines, with same restaurant sales falling again by 2.7% in quarter ending August. It has also completed the closure of some 95 underperforming restaurants in the country.
Ruby Tuesday is likely to reveal Buettgen’s actual package sometime this week or the next.