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March 17, 2008 |
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SOLUTIA INC: Appoints New Members to the Board of Directors These individuals became members of Solutia Inc.'s board of directors by operation of the Debtors' fifth amended joint plan of reorganization: (a) Class I Directors -- Term expiring in 2009 Robert K. DeVeer, Jr. J. Patrick Mulcahy Gregory C. Smith (b) Class II Directors -- Term expiring in 2010 Eugene I. Davis James P. Heffernan W. Thomas Jagodinski (c) Class III Directors -- Term expiring in 2011 William T. Monahan Robert A. Peiser Jeffry N. Quinn On the effective date, five directors stepped down from the board of directors in connection with Solutia's emergence from Chapter 11 -- Paul H. Hatfield, Robert H. Jenkins, Frank A. Metz, Jr., Sally G. Narodick and John B. Slaughter. Rosemary L. Klein, Solutia Inc.'s senior vice president, general counsel and secretary, discloses in a regulatory filing with the U.S. Securities and Exchange Commission that the new non- employee members of Solutia's Board will receive a US$50,000 annual cash retainer, payable quarterly, and an annual stock retainer of shares with a value of US$50,000 payable once a year. Upon joining the Board, each non-employee director will receive a one-time grant of restricted shares with a value of US100,000. All shares will vest one-third annually over the three-year period following the grant. Within five years of joining the board, all directors are required to own and hold Solutia's stock with a value of US$200,000, which is equal to four years of the annual cash retainer, Ms. Klein says. The non-employee lead director will receive an additional annual cash retainer of US$30,000. Committee chairs will receive an additional cash retainer of US$15,000 while other committee members will receive an additional annual cash retainer of US$7,500. No additional fees for attendance at regularly scheduled meetings will be paid. In addition, non-employee directors may participate in Solutia's non-employee director stock compensation plan, under which various forms of stock-based compensation could be granted at the discretion of the executive compensation and development committee of Solutia's Board. A copy of the annual incentive plan, which will be effective for the next five years, at which time Solutia's shareholders will need to re-approve the plan or approve a new plan, is available for free at: http://ResearchArchives.com/t/s?28fa In a separate filing, Ms. Klein states that upon recommendation of the ECDC, the Board has granted restricted stock units and stock options to approximately 225 executives, managers and directors. The grants were effective upon the effective date. * An aggregate of 1,016,560 restricted shares and 176,800 restricted stock units, equal to 2% of total shares of new common stock outstanding. These restricted shares and restricted stock units will vest one-third annually over the three-year period following the date of grant; and * An aggregate of 3,000,000 stock options, equal to 5% of total shares of new common stock outstanding. These options have an exercise price of US$17.33. These will vest one-third annually over the three-year period following the date of grant. About Solutia Inc. Based in St. Louis, Missouri, Solutia Inc. (OTCBB: SOLUQ) (NYSE:SOA-WI) -- http://www.solutia.com/ -- and its subsidiaries, engage in the manufacture and sale of chemical- based materials, which are used in consumer and industrial applications worldwide. The company and 15 debtor-affiliates filed for chapter 11 protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-17949). When the Debtors filed for protection from their creditors, they listed US$2,854,000,000 in assets and US$3,223,000,000 in debts. Solutia is represented by Richard M. Cieri, Esq., Jonathan S. Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP, in New York, as lead bankruptcy counsel, and David A. Warfield, Esq., and Laura Toledo, Esq., at Blackwell Sanders LLP, in St. Louis Missouri, as special counsel. Trumbull Group LLC is the Debtor's claims and noticing agent. Daniel H. Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss Hauer & Feld LLP represent the Official Committee of Unsecured Creditors, and Derron S. Slonecker at Houlihan Lokey Howard & Zukin Capital provides the Creditors' Committee with financial advice. The Official Committee of Retirees of Solutia, Inc., et al., is represented by Daniel D. Doyle, Esq., Nicholas A. Franke, Esq., and David M. Brown, Esq., at Spencer Fane Britt & Browne, LLP, in St. Louis, Missouri, and Frank M. Young, Esq., Thomas E. Reynolds, Esq., R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, in Birmingham, Alabama. On Feb. 14, 2006, the Debtors filed their Reorganization Plan & Disclosure Statement. On May 15, 2007, they filed an Amended Reorganization Plan and on July 9, 2007, filed a 2nd Amended Reorganization Plan. The Bankruptcy Court approved the Debtors' amended Disclosure Statement on Oct. 19, 2007. On Oct. 22, 2007, the Debtor re-filed a Consensual Plan & Disclosure Statement and on Nov. 29, 2007, the Court confirmed the Debtors' Consensual Plan. Solutia emerged from chapter 11 protection Feb. 28, 2008. (Solutia Bankruptcy News, Issue No. 121; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/ or 215/945-7000). * * * As reported in the Troubled Company Reporter on March 4, 2008, Standard & Poor's Ratings Services raised its corporate credit rating on Solutia Inc. to 'B+' from 'D', following the company's emergence from bankruptcy on Feb. 28, 2008, and the implementation of its financing plan. S&P said the outlook is stable. S&P also affirmed its 'B+' rating and '3' recovery rating on Solutia's proposed senior secured term loan. In addition, S&P assigned its 'B-' rating to Solutia's US$400 million unsecured bridge loan facility. S&P also withdrew its 'B-' rating on the proposed US$400 million unsecured notes, which have been replaced by the bridge facility in Solutia's capital structure. |
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