Stone Energy filed with the U.S. Bankruptcy Court a motion for an order authorizing and approving (i) an executive claims settlement agreement with senior executives and (ii) the assumption of certain amended employment agreements and a non-qualified plan.
The motion explains, “Pursuant to the terms of the Settlement Agreement, the Senior Executives will waive their claims related to the Performance Bonus Plan, and in exchange therefore, the Debtors will adopt the Stone Energy Corporation Key Executive Incentive Plan (the ‘KEIP’).”
In addition, “Pursuant to the terms of the Settlement Agreement, the aggregate amount of incentive bonus payments to the Senior Executives for the fourth quarter of 2016 would be reduced from a maximum potential of $3,012,638 (the ‘Fourth Quarter Bonus Opportunity’) to $0. Any future bonus payments to the Senior Executives under the KEIP would not be paid until the consummation of a plan of reorganization and would be limited to $2,008,425, which is equal to the target bonus under the Performance Bonus Plan for the fourth quarter of 2016. Pursuant to the terms of the Settlement Agreement, the Debtors will terminate the CIC/Severance Plan and the Beer Agreement and, as a replacement therefore, adopt the Executive Severance Plan.”
The motion continues, “By terminating the CIC/Severance Plan and the Beer Agreement, entering into the Employment Agreement Amendments, and adopting the Executive Severance Plan, the aggregate amount of the claims that the Senior Executives could assert in the Chapter 11 Cases will be reduced from $21,043,620 to $4,553,000… Finally, pursuant to the terms of the Settlement Agreement, the Debtors will amend the Non-Qualified Plan to eliminate the Debtors’ ability to make matching contributions thereunder and seek the assumption of the Non-Qualified Plan.”
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