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Noranda Aluminum Holding Program, Plans Approved

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The U.S. Bankruptcy Court approved Noranda Aluminum Holding’s senior management severance program for non-insider employees.

As previously reported, “Specifically, the Modified Senior Management Severance Program will provide severance in a lump sum payment equal to the lesser of (i) the severance such employee would have received under the Senior Management Severance Program and (ii) three months’ pay….The Debtors’ Downstream Business is currently in the midst of a sale. This process, as well as the Debtors’ restructuring efforts with respect to their Upstream Business, may result in some of the Debtors’ non-insider senior managers being without employment. Guaranteeing that all affected employees receive equal treatment in the event their employment is terminated will assist in maintaining employee morale during a challenging time.” The Court also approved Noranda Aluminum Holding’s motion for an order authorizing and approving the Debtors’ (i) key employee incentive plan (KEIP); (ii) key employee retention plan (KERP) and (iii) 2015 incentive compensation plan. As previously reported, “KEIP Tier A has a target payout equal to 50% of such employee’s base salary; KEIP Tier B has a target payout equal to 40% of base salary; and KEIP Tier C has a payout equal to 30% of base salary. For all KEIP Participants, payout is capped at 200% of target. For the fourteen (14) non-insider KEIP Participants, a payout floor of one-third of target has been set to ensure their retention throughout these Chapter 11 Cases. The KEIP Participants who are insiders are not guaranteed to receive any payout under the KEIP.”

Court-filed documents continue, “Assuming all proposed KEIP Participants are eligible to receive payments under the KEIP, the total cost of the KEIP is summarized as follows: for KEIP Insiders (5 participants), the total plan cost target is $1,028,007 with $2,050,015 in total plan cost maximum; for KEIP Non-Insiders (14 participants), the total plan cost target is $1,042,751 with $2,085,502 in total plan cost maximum; and the total (19 participants) plan cost target is $2,070,758 with $4,135,517 in total plan cost maximum….Payout at threshold performance is equal to 50% of target, while payout at maximum performance is equal to 200% of target….Assuming all KERP Participants are eligible to receive payments under the KERP proposed payments thereunder will be approximately $895,763, which amounts to approximately $26,346 per KERP Participant. In determining the amount of payments for each KERP Participants, all such participants are divided into the following tiers: (i) KERP Tier A, with payout equal to 30% of base salary; (ii) KERP Tier B, with payout equal to 20% of base salary; and (iii) KERP Tier C, with payout equal to 10% of base salary.”

Read more Noranda bankruptcy news.

The post Noranda Aluminum Holding Program, Plans Approved appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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