Tar Heel Tattler - August 2005
David Singer made $854,026 last year in salary, bonuses and other compensation as chief financial officer of Coca-Cola Bottling Company Consolidated. He resigned in May to become CEO of Charlotte-based snack maker Lance, where he’ll make at least $1.1 million a year. But he’s still on the Charlotte-based bottler’s payroll. He’ll get $21,330 a month for the next 20 years. That’s $5.1 million.
The payout, disclosed in a Securities and Exchange Commission filing, will take longer than the 19 years Singer, 50, put in at Coke Consolidated. The filing says he will provide consulting services for two years. Moreover, he has promised that for five years he won’t engage in competitive activities or entice former colleagues to join his new employer. In exchange, Singer gets full benefits under Coke Consolidated’s officer-retention plan.
Michael Kennedy, managing director in the financial-services practice in the Atlanta office of executive search firm Korn/Ferry International, calls the arrangement “a little rich.” Particularly surprising, he says, is the length of the noncompete. The customary arrangement is a year.
It’s not clear what competitive infractions Singer could commit. Coke Consolidated is the nation’s second-largest Coca-Cola bottler and also bottles and distributes other beverages. Lance makes crackers, cookies, chips and other snacks under the Lance and Cape Cod brands. Kennedy says Coke Consolidated might be edgy because it plans to expand into snacks or fears Lance wants to start selling soft drinks.
Coke Consolidated’s parting gift was certainly heftier than the one Lance bestowed on Singer’s predecessor. The forced departure of Paul A. Stroup III after 31 years at Lance —- including a decade at the helm — created the vacancy Singer filled. The severance deal for Stroup, who earned $936,817 in 2004, included just under $1.5 million in a lump-sum payment. Lance says the severance for Stroup, 54, will bring after-tax charges equivalent to a nickel a share and will affect second-quarter and full-year results for 2005. Coke Consolidated declined to provide a similar calculation.
Like Singer, Stroup agreed not to tell any trade secrets. And both sides agreed not to bad-mouth each other for at least two years.