Outgoing Peloton CEO Barry McCarthy has entered into a “transition agreement” with Peloton, serving in an advisory role until the end of the calendar year on December 31, 2024. During this time McCarthy will receive $50,000 per month for the first three months (May through July) and $5,000 for the remaining five months (August through December) – equating to $175,000 for the remainder of the year.
In case you missed it, yesterday Peloton announced that McCarthy was stepping down as CEO, President, and board member. In addition, Peloton is laying off approximately 400 employees – about 15% of their workforce. Yesterday was also Peloton’s FY Q3 2024 earnings call. You can read all of the details via our overview article.
In a regulatory filing Peloton sent to the SEC, it reveals that in addition to the transition pay, McCarthy will also receive “a stock option award with a fair value of $3 million to purchase shares of Class A common stock that will vest in equal monthly increments through the Transition Date.”
Moreover, McCarthy will receive a payment of $1.25 million at the end of the transition period, along with the cash equivalent of a years’ worth of healthcare, “contingent on a timely execution of a release of claims.” This is the same amount as McCarthy’s annual salary, as around this same time last year we shared that McCarthy had received a pay raise.
Finally, “McCarthy also will receive one year of accelerated vesting on all outstanding stock options (other than the Advisor Award), which will remain exercisable until December 31, 2027.”
Peloton’s two new interim CEOs, Karen Boone and Chris Bruzzo, will each receive $150,000 per month until a new CEO is found – equating to a $1.8 million annual salary. In addition, each will receive “an award of $450,000 restricted stock units, which will vest in equal monthly increments over a three month period.” Neither individual will receive compensation for their service as board members while they serve in the interim CEO roles.
Check out our site for all of the latest news related to the CEO change, layoffs, and Q3 earnings call.
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