Molycorp, Inc. (NYSE: MCP) has in place a severance policy (the “Policy”) for senior management in certain salary grades who are not also parties to an employment agreement with the Company. The members of the Company’s senior management covered by the Policy include the Company’s Chief Financial Officer.
On March 7, 2013, the Company adopted an amendment to the Policy that, among other things, lowered the minimum benefit for terminations covered under the Policy to 13 weeks of base salary and provides credit for service by a member of senior management at any entity the Company has acquired, such as Neo Material Technologies Inc., or will acquire in the future.
That would be a pointless gesture from a CEO who, thus far, has earned none of the blame for MCP's difficulties. If anything, it would say, "Look, we're in trouble." Besides, he is not even the CEO yet.
MCP will be trusted if they are transparent about financials and about all phases of operations. MCP will keep investors' trust if they show they are cutting costs, finishing projects, producing promised low cost products, securing contracts/sales for Xsorbx, and re-approaching profitability.