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DETROIT - Kmart Corp. has asked a federal bankruptcy judge to approve a $1.5 million annual base salary for chief executive and chairman James B. Adamson, The Associated Press reports.
The request was a revision to Kmart's earlier proposal of $1 million a year. In its latest motion the company said Adamson's "wealth of experience in both retailing and restructurings" justified paying him the higher amount.
Attorneys Kmart told Chief Bankruptcy Judge Susan Pierson Sonderby that they would present the revised proposal for Adamson's compensation on April 23 or April 24. In addition to the $1.5 million salary, the new proposal would give Adamson a bonus equal to 125 percent of his base salary upon Kmart's emergence from Chapter 11 bankruptcy. He could receive a smaller or larger bonus, depending on the achievement of performance goals.
The motion also asked to give Adamson to a "success payment" to be determined by the development and execution of Kmart's reorganization plan. The payment would be made by Kmart stock or other Kmart securities.
Additionally, the retailer wants to pay for Adamson's salary, bonuses, incentives, benefits and perks with a $10 million letter of credit pending bankruptcy court approval of the revised employment agreement. The letter of credit in effect guarantees that Adamson will be compensated as promised, regardless of how Kmart fares in the future.