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Tyson Foods interim CEO made $533,459 in 2009

By Emily Fredrix
AP Food Industry Writer / December 22, 2009

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MILWAUKEE—Leland Tollett, who left retirement to lead Tyson Foods Inc. out of an industry downturn, earned $533,459 as the company's interim CEO in 2009, according to an Associated Press calculation of figures filed with regulators.

Tollett, 72, announced his retirement in November, just after the company's fiscal year ended in October. He will receive $300,000 a year to consult with the company until his death, according to documents filed Tuesday with the Securities and Exchange Commission. If he dies within the first 10 years of the agreement, the payments will be made to his estate, guaranteeing $3 million.

In January, Tollett returned to the company he led from 1991 to 1998 to see Tyson's chicken business through a slump triggered by record high prices for key ingredients like corn, and weak restaurant demand. He is succeeded by Donnie Smith, who had been Tyson's senior group vice president of poultry and prepared foods.

Tollett's salary was $477,652. He received perks and other benefits totaling $55,753, including nearly $12,000 for matching contributions under an employee stock purchase plan, about $11,000 for contributions under a retirement savings plan, and about $14,000 for personal use of company aircraft and other items. He received no bonus and no grants of restricted stock and options, and made $54 on above market earnings on deferred compensation.

The Associated Press formula is designed to isolate the value the company's board placed on the executive's total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.

The calculations don't include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the Securities and Exchange Commission, which reflect the size of the accounting charge taken for the executive's compensation in the previous fiscal year.

Tollett replaced Richard Bond, who resigned last January after having served as CEO since 2006. Bond served as CEO of Tyson for about three months in fiscal 2009. His total compensation was about $2 million, according to an AP calculation of the filings.

Bond's base salary was $932,455, although $592,498 of that was paid according to an advisory agreement after his resignation. The filings said that Tyson is retaining Bond to advise the company for 10 years, with payment of $757,620 for the first five years and half that amount in the last five years.

He received perks and other benefits totaling $455,419, including nearly $111,000 for tax reimbursement, $141,000 for personal use of company air craft, $85,435 for executive life insurance and $55,544 for personal use of a company car and the value of that car, which he got to keep after his resignation.

Bond's pay package included grants of restricted stock and options in fiscal 2009 that were valued by the company at $645,000 the day they were made. The options have an exercise price of $4.90, while Tyson's stock price has risen since. Shares were trading Tuesday up 4 cents to $12.32.

He received no bonus and made $25,776 on above market earnings on deferred compensation.

For the year, Tyson lost $537 million, or $1.44 per share, compared with a profit of $86 million, or 24 cents per share, the year before, which included one less week.

Adjusted earnings were 6 cents per share after removing the impairment charge.

Annual sales dipped 1 percent to $26.7 billion from $26.86 billion.

The company, which is based in Springdale, Ark., has been making strides in the meat business and predicts more improvements next year, but analysts worry its all-important chicken business is lagging others in the industry.