BlackBerry could pay $250 million break fee in event of better offer: filing
TORONTO (Reuters) - BlackBerry Ltd will pay up to $250 million to a group of debtors including Prem Watsa's Fairfax Financial Holdings if another deal succeeds, according to a regulatory filing on Thursday detailing the debt deal.
The filing also showed that incoming interim chief executive and executive chairman John Chen will receive a base salary of $1 million and a bonus of up to $2 million. Chen will also receive 13 million restricted stock units, with half of them vesting only after five years with the company.
BlackBerry on Monday abandoned plans to sell itself and instead opted to raise $1 billion by selling convertible notes to a group of investors. The company had said Fairfax, its largest shareholder, was buying $250 million of the offering.
Chen is the second straight chief executive at Canada's most prominent technology company to receive a lucrative pay package for what could be a short stint of work. Thorsten Heins, who left the company after the failed sale, could also receive millions in severance after two years in the job, although the exact amount will depend on the terms of his departure.
Should Chen be fired without cause, he will be paid up to $6 million, according to the filing.
In the filing, BlackBerry said Canso Investment Counsel Ltd is buying $300 million, while Mackenzie Financial, Markel Corp, Qatar Holding, and Brookfield Asset Management, are buying the remainder.
The $250 million break fee would come due the day after control changes at Blackberry, according to the filing. If Fairfax and its partners agree to go ahead with the deal even after a change of control, Blackberry would still have to pay the group $135 million.