Energy Future Holdings Corp., the bankrupt Texas power producer, asked a judge for permission to pay some managers almost $10.5 million in bonuses, on top of an undisclosed amount to retain three top executives whose payout the company is keeping secret.
Energy Future said details about its management incentive plan must be kept from rivals in the power industry.
“Competitors could use this information to recruit and hire key management employees away,” company lawyers said in an Aug. 8 filing in U.S. Bankruptcy Court in Wilmington, Delaware.
Energy Future filed for bankruptcy in April, listing $49.7 billion in debt. A plan negotiated with senior lenders to split the Dallas-based company in two and give each piece to a different group of creditors was abandoned last month in the face of opposition by lower-ranking debt holders.
One program would pay as much as $7.93 million next year to 26 participants. The other would pay as much $2.56 million beginning later this year to 19 employees the company considers “key leaders.” The proposal needs approval from U.S. Bankruptcy Judge Christopher Sontchi.
The undisclosed executive bonuses are part of two other compensation programs. Money would be paid in February and March. While under court protection, companies must win court approval for incentive programs. The four programs affect a total of 26 people, Adam McGill, a company spokesman, said in an e-mail.
Typically, a company makes public the total amount of bonuses, while keeping secret the names of lower-ranking managers receiving the payments. Top company officials are often identified along with the amount they are being paid.
In its filing, Energy Future blacked out the total it seeks to pay, along with individual awards to the three unidentified executives.
In July, Energy Future won approval for a much bigger set of incentive programs designed to reward about 5,500 workers and managers. Those programs would pay about $100 million should all of the various thresholds be met.
The programs are similar to incentive plans that were in place before the company filed for bankruptcy.
The case is Energy Future Holdings Corp., 14-bk-10979, U.S. Bankruptcy Court, District of Delaware (Wilmington).