(Bloomberg) -- Whiting Petroleum Corp.’s board approved $14.6 million in cash bonuses for top executives days before the shale oil producer filed for bankruptcy.
Chief Executive Officer Brad Holly will collect $6.4 million of the total, which will be “paid immediately,” the company said in a filing Wednesday. Four other executives including Chief Financial Officer Correne Loeffler will get the rest.
The board signed off on the payouts March 26 as part of an overhaul of the company’s variable compensation program. The coronavirus pandemic, coupled with a price war between Russia and Saudi Arabia, has dealt a crushing blow to the oil and gas industry, making it “virtually impossible” to set short-term performance goals, according to the filing.
Instead, the board said employees eligible for variable compensation can receive payouts that amount to no more than their target levels. The payouts will be made quarterly. As part of the deal, the senior executives agreed to forfeit equity awards they were in line to receive this year.
The new program “is intended to ensure the stability and continuity of the company’s workforce and eliminate any potential misalignment of interests that would likely arise if existing performance metrics were retained,” the company said in the filing.
Whiting, one of the biggest producers in North Dakota’s Bakken formation, filed for Chapter 11 Wednesday after the plunge in oil prices left it unable to pay its debts, which had been a challenge even before the latest downturn.
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