John Simons, former president and chief executive officer of Greeley-based Swift & Co., left the company with a severance package worth more than $7.16 million.
Details of the package were included in a filing with the U.S. Securities and Exchange Commission by S&C Holdco 3 Inc., of which Swift & Co. is a part.
The Wednesday filing detailed three payments that include almost $2.5 million in cash and unpaid salary, more than $3.4 million in payment for options Simons had to purchase for 4 million shares of Swift stock, and about $1.25 million paid to Simons for the nearly 1.24 million shares of Swift that he owned. In addition, he was given a six-month consulting contract worth $226,000.
Jim Herlihy, spokesman for Swift & Co., said the "filing speaks for itself."
Simons resigned from Swift on April 14 in a surprise announcement by the company. Simons did not comment on his leaving, but some industry sources indicated it was not his decision.
Steve Kay, publisher of California-based Cattle Buyers Weekly, said the package doesn't surprise him in terms of the money. In fact, it may put the whole situation in a new light.
"It really puts a new light onto his departure," Kay said. "There was a lot of conjecture that somehow the owners of Swift & Co. potentially wanted to make a change or were dissatisfied with his leadership. But he wouldn't have been given a consulting contract" if they were unhappy.
Simons' departure came on the heels of the company's most recent earnings statement Feb. 27, which showed a 6.2 percent increase in companywide sales from the previous year. Just before Christmas, the company laid off 800 employees in preparation for a new second shift to further produce the meat slaughtered from the Greeley beef plant's first shift. Since the announcement, the company has rehired about 400 of the workers based on their seniority.
Also, the company negotiated hard last fall to cut benefits and wages when a contract with the United Food and Commercial Workers Local No. 7 expired. The employees won out in the end with a base-pay raise and benefits package.
Though many employees have returned to work, Simons' "golden parachute" is hard to swallow, said Dave Minshall, spokesman for the UFCW.
"From Local 7's point of view, it is ludicrous for Swift to come in and say they can't afford to pay decent wages and benefits and lay people off when the guy who runs the place walks off with a $7 million nest egg," Minshall said. "That defies reason."
Simons had been in Greeley since 1999 when he was named CEO of ConAgra Beef Co., Swift's predecessor.
During his tenure, Swift & Co. built and moved into new headquarters at Promontory, was involved in a new contract for union workers at its Greeley beef-packing plant and dealt with dropping beef sales following the single case of mad cow disease in Washington state that closed the Japanese and several other borders to U.S. beef.