El Paso CEO Set to Receive $95 Million in Exit Pay Following Kinder Morgan Deal
El Paso Corp. Chief Executive Douglas Foshee will be receiving an exorbitant exit package of $95 million dollars after Kinder Morgan Inc. acquires El. Paso Corp. Foshee’s exit package will include severance payments and equity, according to a Wall Street Journal analysis of El Paso’s regulatory filings.
Mr. Foshee’s exit package will be one of the largest ever received by a CEO following a merger.
Most of the money, $69 million, will come from 4.27 million stock options granted over his eight-year tenure at El Paso. He has not exercised any options since arriving at El Paso and some options carry exercise prices as low as $6.34 – much lower than the $26.87-per-share value of the deal.
According to El Paso’s most recent proxy statement, filed last March, all of Mr. Foshee’s options vest if he leaves the company within two years of acquisition. As of March, he held roughly 2.9 million vested options and 1 million unvested options. According to El Paso’s filings, he was granted an additional 377,000 options.
The $21.1 billion acquisition of the El Paso Corporation will make Kinder Morgan the nation’s biggest empire of oil and gas pipelines. Kinder Morgan would own or operate 67,000 miles of pipeline that stretches across the continent and transports more than one million barrels of fuel a day. Kinder Morgan was formed by Richard D. Kinder in February 1997, and had about $300 million in enterprise value.