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EXCO Bankruptcy KERP Filed

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EXCO Resources filed with the U.S. Bankruptcy Court a motion for entry of an order authorizing and approving the Debtors’ key employee retention plan (KERP) for non-insider employees.

The motion explains, “By this motion, the Debtors seek entry of an order, approving and authorizing the Debtors to continue the KERP for approximately 144 of the Debtors’ non-insider employees, providing for an award pool of approximately $3.3 million in the aggregate, approximately $1.8 million of which was earned and paid to participating employees prior to the Petition Date on account of the third and fourth quarters of 2017 and approximately $1.5 million of which may be earned by participating employees on account of continued employment with the Debtors through the first and second quarters of 2018.”

In addition, “The Debtors respectfully request that the Court grant this motion for three independent reasons. First, the KERP should be permitted under section 363(c) of the Bankruptcy Code because it is a continuation of the Debtors’ prepetition practices and thus is an ordinary course transaction entitled to significant deference from the Court. Second, continuing the KERP is a reasonable exercise of the Debtors’ business judgment and is also appropriate under section 363(b) of the Bankruptcy Code. Third, the KERP is not subject to section 503(c)(1) of the Bankruptcy Code because no insiders are participants in the program. The KERP is justified by the ‘facts and circumstances’ of these cases and is therefore authorized under section 503(c)(3) of the Bankruptcy Code.”

The Court scheduled a February 22, 2018 hearing to consider the KERP motion.

Read more EXCO Resources bankruptcy news.