McDonald's bars former CEO from working at rival restaurant chain for two years

Key Points
  • Former McDonald's CEO Steve Easterbrook cannot take a job with one of its rivals for the next two years.
  • The ban is a part of the separation agreement with the company, which fired him after he violated company policy by having a relationship with an employee.
  • Easterbrook will receive 26 weeks of severance pay.
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Don't expect to see former McDonald's CEO Steve Easterbrook at another restaurant chain anytime soon.

The fast-food giant is barring him from working for one of its competitors for the next two years as part of his separation agreement, according to a company filing on Monday. Those companies include Chick-fil-A, Yum Brands, Coca-Cola's Costa and convenience store chains WaWa and 7-Eleven.

McDonald's board voted to oust Easterbrook on Friday after he violated company policy by having a relationship with an employee, and the company announced the decision Sunday evening. Shares of the fast-food giant fell nearly 3% in morning trading Monday.

Easterbrook will receive 26 weeks of severance. Last year, he earned $15.9 million in total compensation, including a $1.3 million base salary. His successor, Chris Kempczinski, who most recently served as head of McDonald's U.S. division, will receive the same annual base salary. Kempczinski could earn up to $2.1 million in annual bonuses.

If McDonald's hits its performance targets for 2019, Easterbrook will also be eligible for a prorated payment based on his termination date. In 2018, he earned $2.5 million from non-equity incentive plan compensation.

Easterbrook also agreed to a non-disparagement clause. For the next five years, he is barred from publishing any articles or books about McDonald's or giving interviews related to McDonald's without permission from the company's general counsel.