ABINGDON, VA (WJHL) Alpha Natural Resources wants a judge to okay a plan to let 17 senior executives compete for up to $14.8 million in bonuses next year; all while the bankrupt company continues to push to suspend medical and life insurance benefits for more than 4,500 non-union retirees and their families, according to federal court filings.
Those $7.4 to $14.8 million dollars in proposed 2016 bonuses would not be guaranteed. Instead, they’d be based on performance when it comes to financial health, safety and environmental stewardship.
Alpha says the bonuses are necessary considering executive compensation dropped by 57% in 2015 and because previously agreed upon retention bonuses cannot be offered during the chapter 11 process.
“Successfully navigating Alpha’s restructuring process has been and continues to be the primary focus of our senior management team, and maintaining that strong leadership throughout this process is viewed as essential in the eyes of both the Board and Alpha’s constituencies,” the company said in a statement. “This proposal will only become effective upon a full vetting and approval by the Court.”
In court documents Alpha Board Member and Compensation Committee Chairman L. Patrick Hassey said the 17 participants are critical to the chapter 11 process and have been working “tirelessly both prior to and since” the cases.
“(The executives) will play an indispensable role in the operation and restructuring of the Debtor’s businesses during these chapter 11 cases and should be incented to maximize the value achieved,” Hassey wrote in support of the proposal.
Alpha says a market study by its consultant found the proposal to be fair and reasonable. Alpha also says performance bonuses like these are common when it comes to these kinds of situations and have been approved before by the courts.
While Alpha awaits a decision regarding this proposal, the company is also waiting for a judge to make a decision about its proposal to cut retiree benefits. A hearing is set for January 21st, according to court documents.
In response to that proposal, a judge recently allowed five retirees to form a committee, which Alpha did not oppose. The members included Rickey Simpkins, David Canterbury, Leo Harris, former CEO Michael Quillen and Clarence Whisenhunt, Jr.
As we reported last month, Alpha gave its top executives $3.5 million in bonuses in 2014, which included both retention and performance bonuses.
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