Dialing for dollars on departure at Dex One __»

May 26, 2010

For a man who led his company into bankruptcy, and back out again, David C. Swanson probably won’t have to worry about solvency for while.

Swanson, of course, has been chief executive of Dex One (DEXO), the yellow-pages company previously known as R.H. Donnelley Corp., for the last eight years, and chairman for about half that time. That means he’s the same man who led the company into a voluntary bankruptcy filing last year, a development the company blamed on ongoing economic challenges in its post-emergence 10-K this spring. On the downhill slide to bankruptcy and during the restructuring, the company cut its headcount 20% in 2008 and “continued to actively manage expenses and enacted a number of initiatives to streamline operations and contain costs” in 2009, among other things freezing pension benefits for employees. The company emerged, restructured, on Jan. 29.

Now he’s stepping down, effective Friday. Described as a retirement in the 8-K that Dexo put out on Friday, it was announced just seven days before his departure date, and the same document notes that he

“will receive severance benefits to which he is entitled under his Amended and Restated Employment Agreement dated as of December 31, 2008, as amended — in connection with a termination not for Cause following a Change of Control—”

In any case, he eased out in style. According to the Separation Agreement filed with the 8-K, he’s getting a $6.45 million lump-sum cash payment, plus unspecified accrued and unpaid vacation time, and a pro-rata annual bonus for 2010. He’ll be reimbursed for the cost of getting health, dental and life insurance through as late as May 31, 2013 — a good three years.

He gets to keep his 25,230 unvested stock appreciation rights — valued at $468,521 Tuesday night — which he can exercise between March and June next year, and he’s eligible for a long-term incentive payment of as much as $3.49 million. He gets another $5.7 million payout from a special executive pension that survived the bankruptcy process, on top of the pension he’s due under the company’s plan for all employees, which was worth $1.4 million as of Dec. 31, according to the company’s latest 10-K. He also gets his deferred-compensation account balance, which was $124,014 at the end of last year (over and above the $538,230 he collected from the deferred comp plan at the beginning of 2009.)

And last but still not insignificantly, he gets payments to make up for some of his customary perks — also continuing until as late as May 2013. Those include health-club and country-club memberships ($8,340 a year), financial planning reimbursement of up to $14,700 a year, “executive health at the annual rate of $1,585” and outplacement-services reimbursement totaling as much as $25,000.

The total haul by our calculation? As much as $17.72 million if he collects the full long-term incentive bonus and maxes out the perks, and if Dexo’s stock doesn’t change for the next year.

That would cover the bill for calling 411 to get the phone numbers of every household in New York state. Or he could let his fingers do the walking all the way to the bank.

Image source: jamiesrabbits via Flickr

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