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Orexigen Bankruptcy KEIP, KERP Approved

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The U.S. Bankruptcy Court approved Orexigen Therapeutics’ motion for entry of an order (i) authorizing implementation of a key employee incentive plan (KEIP) and a key employee retention plan (KERP) and (ii) approving the terms of the KEIP and KERP.

As previously reported, “The KERP covers 66 non-insiders with target award amounts equal to three month’s base salary of each participant. The total cost of the program is $3,115,000….In comparing the KEIP against other bankruptcy companies, the target Operational Incentive payouts for the two Participating Finance Employees at a cost of $131,250 funding was significantly lower than the 25th percentile of the market target Operational Incentive costs of $1.3M.”

In addition, “The Debtor’s Asset Sale Incentives with an aggregate cost of $1.5M at target funding (assuming $100 million asset sale value) falls between the 25th percentile ($1.05M) and the 50th percentile ($1.74M) of the market Asset Sale target aggregate costs. Based on the Debtor’s aggregate Operational Incentive target payouts falling below the 25th percentile of the market reference companies, and the Debtor’s aggregate Asset Sale target payouts falling between the 25th and 50th percentile of the market reference companies, the Debtor’s KEIP aggregate costs were found to be reasonable in comparison.”

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The post Orexigen Bankruptcy KEIP, KERP Approved appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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