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In his first year at The Coca-Cola Co., Deval L. Patrick earned almost as much in salary and bonuses as his predecessor in the general counsel’s office did in three years. Patrick, hired as Atlanta-based Coca-Cola’s executive vice president and general counsel a year ago, earned $1.35 million — $359,583 in salary and $995,000 in bonuses — according to the company’s 2002 proxy statement. According to Patrick’s employment contract and the proxy, the bonus includes $500,000 that is half of a $1 million “make-whole” payment to compensate him for leaving his prior job as Texaco’s general counsel. He is to get the other half of the “make-whole” payment this year. In contrast, it took his predecessor, Joseph R. Gladden Jr., three years to earn salaries and bonuses totaling $1.56 million, according to the company’s 2000 proxy. Gladden had a 25-year association with Coca-Cola, becoming general counsel in 1990 and executive vice president in 2000. In 1997, his salary was $381,833 with a bonus of $205,000. In 1998, his salary was $390,000 with a bonus of $175,000. And in 1999 he didn’t get a bonus, but earned a salary of $412,916. Gladden’s pay was not listed in the 2000 or 2001 proxies. When compared with the cash compensation of other top general counsel, Patrick’s $1.35 million pay stands up well. He’d have ranked 11th on Corporate Counsel magazine’s most recent list of the nation’s most highly paid in-house lawyers. (That list covers 2000 salaries, however, and Patrick’s pay is for 2001.) But Gladden would have ranked just 203rd for his $412,916. (Again, the list covers 2000 pay, and Gladden’s most recent public compensation dates from 1999.) Patrick brought some things to the table that his predecessor couldn’t offer, despite Gladden’s history with Coca-Cola and a decade handling the beverage giant’s work at longtime outside counsel, King & Spalding. JOINED SOON AFTER SETTLEMENT Patrick became Coca-Cola’s first-ever black general counsel, joining the soft-drink maker soon after Coca-Cola agreed to pay a record $192.5 million to settle a class action race discrimination suit brought by some of its black employees. That suit was settled during Gladden’s tenure. The settlement was modeled after a similar, $176.5 million settlement that Texaco — Patrick’s former employer — reached with its workers in 1997. Before becoming general counsel at Texaco, Patrick had headed an independent task force that monitored the implementation of the Texaco settlement. Hence, perhaps, the difference between Patrick’s first year at Coca-Cola and three of Gladden’s last years: about $210,000. If Patrick had spent a full year at Coca-Cola (he joined the company in April 2001, so his salary was pro-rated), he would have earned $475,000, and the difference between his one-year pay and Gladden’s three-year pay would have been just $94,749. After resigning, Gladden agreed to work part time between June and November 2001 at half his base pay to help Patrick with the transition, according to the 2002 proxy. After November, he agreed to consult as necessary for $1,500 per day. For an eight-hour day, that’s $187.50 per hour — kind of a bargain. But it’s not as if Gladden was poorly paid during his time at Coca-Cola. In addition to salary and bonuses, he got almost $750,000 more during those three years, primarily from the company’s long-term incentive plan. Gladden also owned at least 806,000 shares of Coca-Cola common stock, according to the 2000 proxy. If he still owns them all today, they’d be worth $43 million, based on Tuesday’s closing price of $53.35. He also had 144,500 shares of stock underlying then-unexercised options, some of which could be exercised at a price of $53.40. And he had 320,000 shares in then-restricted stock awards, which if exercisable Tuesday would have been worth $17 million. Also, it’s impossible to know how much he made in salary and bonuses during the many years when he wasn’t one of the company’s five highest-paid executives — and therefore wasn’t bound by the legal requirement to detail his earnings in public documents. PATRICK HAS STOCK, OPTIONS Patrick got his share of shares, too. He’s listed as owning 215,777 shares of stock, which were worth $11.5 million at Tuesday’s close, as well as 378,000 stock options, some of which are performance-based. Company spokesman Dwight Williams said part of those 378,000 options is restricted shares that according to the proxy were worth $9 million at year-end. The rest — whose value he won’t quantify — are part of Patrick’s thrift savings plan and 401(k) plan. Of those shares, 300,000 are exercisable at a price of $48.21, and 78,000 are exercisable at $45.26, according to the proxy. Patrick also has the potential to get a long-term incentive plan award based on his performance after three years. The target award is $494,820, but the payout could range from a low of $49,482 (or even zero if the company has a bad year) to a high of $865,935. Other benefits listed in Patrick’s employment contract include: � Coca-Cola agreed to pay after-tax travel expenses for at least one year, so that Patrick could commute to his principal residence in Milton, Mass.; � if Patrick decides to relocate to Atlanta, the company will pay moving costs plus travel expenses for his spouse; � if Patrick stays for his entire five-year contract term, he will receive 15 years of pension credit; � Patrick is entitled to a minimum of four weeks’ paid vacation, and other vacation, illness and personal time benefits; � if he is terminated for cause — which includes gross negligence in his duties, dishonesty or fraud — prior to his third anniversary as an executive with the company, he’ll get a cash payment of $1.55 million; and � if Patrick’s termination isn’t for cause, he’s eligible for a lump sum amount equal to the sum of twice his then-current base salary and the average of the incentives he’s earned over the last three years, offset by any severance pay. Of course, the company did impose some restrictions on Patrick in exchange for its largesse. Among them: He can’t reveal trade secrets, aka, the Secret Formula. But with his pay package, he shouldn’t have any trouble affording all the Coke he wants.

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