3rd Order Approving Top Executive Retention
EX-10.35 6 h08449exv10w35.txt 3RD ORDER APPROVING TOP EXECUTIVE RETENTION EXHIBIT 10.35 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION In re: ) ) Jointly Admin. Under Case No. PHILIP SERVICES CORPORATION, et al. ) 03-37718-H2-11 ) ) Debtors. ) (Chapter 11) THIRD ORDER APPROVING TOP EXECUTIVE RETENTION PORTION OF EMPLOYEE RETENTION, INCENTIVE AND SEVERANCE PLANS [DOCKET NO. 92] Upon consideration of the Debtors' Expedited Motion to Approve Employee Retention, Incentive and Severance Plans (the "Motion"), filed by Philip Services Corporation and its affiliated debtors (collectively, the "Debtors"), as debtors-in-possession, seeking approval under sections 363(b) and 105(a) of the Bankruptcy Code for the Debtors to implement the Retention, Incentive and Severance Plans as described in the Motion (the "Retention Program"); and it appearing that the Debtors have demonstrated a sound business judgment for the use of the Debtors' property in connection with the Retention Program; and it appearing that such Retention Program is in the best interest of the Debtors' estates and creditors; and it appearing that due and proper notice of the Motion has been given; and upon the proceedings had before the Court; and good and sufficient cause appearing therefor, it is hereby(1) ORDERED that the Debtors' are authorized to implement the incentive portion of the Top Executive Plan, in the form circulated to the senior secured creditors, the Term/PIK lenders and the Creditors Committee on July 19, 2003, and as reflected in Exhibit A to this Order, up to $1.3 million; it is further - ---------- (1) All capitalized terms not defined herein shall have the meaning ascribed to them in the Motion. ORDERED that any payments made pursuant to this Order shall be subject to any DIP Financing or Cash Collateral Order entered in these cases; and it is further ORDERED that this Court shall retain jurisdiction with respect to all matters arising from or related to the implementation of this Order. SIGNED this 28th day of July, 2003. /s/ Wesley W. Steen ------------------------------ UNITED STATES BANKRUPTCY JUDGE PHILIP SERVICES CORP EXECUTIVE INCENTIVE/RETENTION PLAN - ------------------------------------------------------------------------------------------------------------------------------ SINGLE TRANSACTION ASSET SALE OR PLAN VALUE - ------------------------------------------------------------------------------------------------------------------------------ Executive Sale Proceeds or Plan Value for PSC ($ Millions) $160 $170 $180 $190 $200 $210 $220 $230 ------------------------------------------------------------------------------------- Title Salary Proposed Incentive Award - --------------------------------------- ------------------------ Principal Executive Officer $ 180,000 $ 22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $ 182,533 Chief Financial Officer $ 250,000 $ 22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $ 182,533 General Counsel $ 280,000 $ 22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $ 182,533 President, ISG Group $ 230,000 $ 22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $ 182,533 President, Metals Group $ 274,000 $ 22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $ 182,533 SVP, Health, Safety, & Env. $ 155,000 $ 22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $ 182,533 - ------------------------------------------------------------------------------------------------------------------------------ TOTAL $1,369,000 $136,900 $273,800 $410,700 $547,600 $684,500 $821,400 $958,300 $1,095,200 - ------------------------------------------------------------------------------------------------------------------------------ - ----------------------------------------------------------------- - ----------------------------------------------------------------- Executive $240 $250 ------------------------ Title Salary - --------------------------------------- Principal Executive Officer $ 180,000 $ 205,350 $ 228,167 Chief Financial Officer $ 250,000 $ 205,350 $ 228,167 General Counsel $ 280,000 $ 205,350 $ 228,167 President, ISG Group $ 230,000 $ 205,350 $ 228,167 President, Metals Group $ 274,000 $ 205,350 $ 228,167 SVP, Health, Safety, & Env. $ 155,000 $ 205,350 $ 228,167 - ----------------------------------------------------------------- TOTAL $1,369,000 $1,232,100 $1,369,000 - -----------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------ MULTIPLE TRANSACTION ASSET SALE OR PLAN VALUE - ------------------------------------------------------------------------------------------------------------------------------ Executive Sale Proceeds or Plan Value for METALS ($ Millions) $64 $68 $72 $76 $80 $84 $88 $92 ------------------------------------------------------------------------------------- Title Salary Proposed Incentive Award - --------------------------------------- ------------------------ Principal Executive Officer $ 180,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 Chief Financial Officer $ 250,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 General Counsel $ 280,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 President, ISG Group $ 230,000 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 President, Metals Group $ 274,000 $22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $182,533 SVP, Health, Safety, & Env. $ 155,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $$91,267 - ------------------------------------------------------------------------------------------------------------------------------ TOTAL $1,369,000 $68,450 $136,900 $205,350 $273,800 $342,250 $410,700 $479,150 $547,600 - ------------------------------------------------------------------------------------------------------------------------------ - ----------------------------------------------------------------- - ----------------------------------------------------------------- Executive $96 $100 ------------------------ Title Salary - --------------------------------------- Principal Executive Officer $ 180,000 $102,675 $114,083 Chief Financial Officer $ 250,000 $102,675 $114,083 General Counsel $ 280,000 $102,675 $114,083 President, ISG Group $ 230,000 $ 0 $ 0 President, Metals Group $ 274,000 $205,350 $228,167 SVP, Health, Safety, & Env. $ 155,000 $102,675 $114,083 - ----------------------------------------------------------------- TOTAL $1,369,000 $616,050 $684,500 - -----------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------ MULTIPLE TRANSACTION ASSET SALE OR PLAN VALUE - ------------------------------------------------------------------------------------------------------------------------------ Executive Sale Proceeds or Plan Value for ISG ($ Millions) $96 $102 $108 $114 $120 $126 $132 $138 ------------------------------------------------------------------------------------- Title Salary Proposed Incentive Award - --------------------------------------- ------------------------ Principal Executive Officer $ 180,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 Chief Financial Officer $ 250,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 General Counsel $ 280,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 President, ISG Group $ 230,000 $22,817 $ 45,633 $ 68,450 $ 91,267 $114,083 $136,900 $159,717 $182,533 President, Metals Group $ 274,000 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 SVP, Health, Safety, & Env. $ 155,000 $11,408 $ 22,817 $ 34,225 $ 45,633 $ 57,042 $ 68,450 $ 79,858 $ 91,267 - ------------------------------------------------------------------------------------------------------------------------------ TOTAL $1,369,000 $68,450 $136,900 $205,350 $273,800 $342,250 $410,700 $479,150 $547,600 - ------------------------------------------------------------------------------------------------------------------------------ - ----------------------------------------------------------------- Executive $144 $150 ------------------------ Title Salary - --------------------------------------- Principal Executive Officer $ 180,000 $102,675 $114,083 Chief Financial Officer $ 250,000 $102,675 $114,083 General Counsel $ 280,000 $102,675 $114,083 President, ISG Group $ 230,000 $205,350 $228,167 President, Metals Group $ 274,000 $ 0 $ 0 SVP, Health, Safety, & Env. $ 155,000 $102,675 $114,083 - ----------------------------------------------------------------- TOTAL $1,369,000 $616,050 $684,500 - -----------------------------------------------------------------
Note: 1. Each executive (except Principal Executive Officer) will receive a retention award of 25% of his salary to stay through emergence from bankruptcy (whether or not a sale occurs.) 2. The retention award will vest and be paid quarterly over the year following emergence from bankruptcy. 3. The maximum award to an executive will be 25% of his salary, plus the incentive award shown in the tables above. 4. Incentive awards will be prorated for a sale price or plan value between indicated levels. 5. No incentive will be awarded for sales proceeds or plan values less than the minimums shown in the tables. 6. Incentive awards for sale proceeds or plan values greater than $250 million (aggregate), $100 million (Metals) or $150 million (ISG) will be calculated by extrapolation from the above table. 7. ISG is sold with environmental liabilities and includes the Analytical Group. 8. Entitlement to the retention award is conditioned upon emergence from bankruptcy by March 31, 2004. 9. Entitlement to the incentive award is conditioned upon sale or plan approval occurring by March 31, 2004. 10. No incentive award is payable if the purchaser or prevailing plan sponsor is Carl Icahn or any entity or entities which he controls.
