What are the main performance metrics for Cheniere's executive bonuses in 2006?

The executive bonuses for 2006 are tied to achieving either a minimum increase in Cheniere Energy's net asset value per share or a minimum total stockholder return for the period January 1, 2006, through December 31, 2006.

How were executive bonuses structured before and after the March 29, 2006, amendment?

Initially, bonuses were planned as a percentage of base salary, with potential payouts ranging up to 300% for the CEO. Following the amendment on March 29, 2006, the maximum bonus amounts were changed to a specified number of phantom stock shares, providing a different mechanism for potential compensation.

What is 'phantom stock' in this context?

Phantom stock, as defined in the filing, is a right granted to an executive that allows them to receive a share of Cheniere's common stock or cash equivalent to the value of a share of common stock at the end of the 2006 performance period, provided that the performance goals are met.

What compensation was provided to the newly elected director, Vicky A. Bailey?

Ms. Vicky A. Bailey, elected as a director on March 29, 2006, received 25,000 fully vested stock options with a ten-year term and an exercise price of $40.27. She also received a service fee of $25,000 for her service from March 29, 2006, through May 2006.

LNG 8-K: Material Agreements

Summary

Cheniere Energy, Inc. (LNG) filed an 8-K on April 3, 2006, reporting on the establishment of executive compensation plans for the 2006 fiscal year. The primary focus is on the "2006 Performance Bonus Plan," which ties executive bonuses to the company's performance, specifically a minimum increase in net asset value per share or total stockholder return. This plan outlines performance periods, maximum payout percentages based on base salary, and the flexibility to pay bonuses in cash, stock, or a combination. A significant amendment occurred on March 29, 2006, where the maximum bonus targets were shifted from a percentage of base salary to a maximum number of shares of "phantom stock." Phantom stock represents the right to receive company common stock or an equivalent cash value at the end of the performance period, contingent on achieving the set goals. The filing details the specific number of phantom stock awards for key executives, including the CEO, Vice Chairman, President, and Senior Vice Presidents. Additionally, the report notes the election of a new director, Ms. Vicky A. Bailey, and details her compensation package, which includes stock options and a service fee.

Key Highlights

1Cheniere Energy established executive performance goals and bonus structures for 2006, contingent on achieving minimum net asset value per share growth or total stockholder return.
2The 2006 Performance Bonus Plan initially set maximum payouts as a percentage of base salary (up to 300% for CEO).
3On March 29, 2006, the bonus structure was revised to award a maximum number of phantom stock shares instead of a percentage of salary.
4Phantom stock awards entitle executives to company common stock or cash equivalent upon meeting 2006 performance targets.
5Specific phantom stock award amounts are detailed for key executives, including Charif Souki (CEO) and Stanley C. Horton (President/COO).
6Vicky A. Bailey was elected as a director on March 29, 2006, and was granted 25,000 fully vested stock options with a $40.27 exercise price.
7Ms. Bailey also received a service fee of $25,000 for her tenure from March 29, 2006, through May 2006.

Cheniere Energy, Inc. 8-K Report, Material Agreement (Apr 3, 2006)

Summary

Key Highlights

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