As part of the deal, they agreed to release the city and all employees of any liability in exchange for $1 each.
As part of the agreement, Robinson and Nelson will have an opportunity to provide input based on their personal experience to former US Attorney General Eric Holder as part of company's long-term diversity and equity efforts.
The men will work with the city and a nonprofit organization to develop criteria, review applications and award the $200,000 grant, Dunn said.
The details of the financial settlement that Donte Robinson and Rashon Nelson reached this week with Starbucks are confidential, the company said.
Also on Wednesday, Starbucks announced that it had reached an agreement with Nelson and Robinson that will include an undisclosed financial settlement "as well as continued listening and dialogue between the parties and specific action and opportunity". The program will be aimed at helping Philadelphia public high school students.
Screengrab of a video posted by a Starbucks client showing several uniformed police officers handcuffing the two men and leading them out of the store.
"We thought long and hard about it and we feel like this is the best way to see that change that we want to see", Robinson said, according to an Associated Press report. As the police were making their arrest, the man Nelson and Robinson were waiting for arrived.
The arrests prompted a #BoycottStarbucks campaign and protests at the store in Center City.
Mayor Kenney lauded the idea, saying pain from the incident would have resurfaced "over and over again" had litigation unfolded.
Robinson and Nelson have also been offered the opportunity to complete their undergraduate degrees through the Starbucks College Achievement Plan, a first of a kind partnership with Arizona State University otherwise available to Starbucks partners to earn their bachelor's degree with full tuition coverage.
Philadelphia police chief Richard Ross publicly apologized for the incident, admitting he "failed miserably" with his initial response. He also announced that more than 8,000 Starbucks stores in the United States would close on the afternoon of May 29 so 175,000 employees can get training in unconscious bias.
"I want to thank Donte and Rashon for their willingness to reconcile", CEO Kevin Johnson said in a statement. "And Starbucks will continue to take actions that stem from this incident to fix and reaffirm our values and vision for the kind of company we want to be", Johnson said.