Responding to a firestorm of criticism, former Nabors Industries CEO Eugene Isenberg will give up the $100 million parting paycheck triggered by his resignation in October, the company said Monday.

Isenberg shredded an employment contract that promised him a super-size severance payout and outraged some shareholders.

Isenberg's final paycheck would have been nearly 10 times the amount he received in salary and bonuses in 2010. He stood to make more by leaving Nabors than the company earned in his final quarter as chief executive.

The board maintained that Isenberg was due the payout even though he retained his role as board chairman. Now, he'll relinquish that position, too, when his term ends in June, according to a company statement. He will be named chairman emeritus.

Isenberg, who served as chief executive of the oil and gas drilling company for 24 years and perennially ranked among Houston's top-paid executives, said he had planned to give the money to charity.

"I ultimately concluded that everyone's interests, including the company's and our shareholders', were best served by this new arrangement," Isenberg said.

"It is my hope that the company utilizes a substantial portion of these savings for worthy charitable purposes."

Isenberg, 81, was due the $100 million payment under the "constructive termination" clause of his contract, according to Nabors.

The company contends that Isenberg was constructively terminated when the board appointed Anthony Petrello, Isenberg's handpicked successor, as CEO in October.

Petrello has a similar clause in his contract, awarding him a $50 million payout if he is constructively terminated.

Another $7 million

Isenberg is also forgoing $7 million in his deferred bonus account. He still will be covered by Nabors' insurance and fringe benefits and his estate will receive $6.6 million when he dies, according to a company statement.

A company representative could not be reached for comment Monday.

Nabors has been targeted by a flurry of shareholder complaints over executive pay packages that investors call lavish and in conflict with the company's declining stock value last year.

Representatives of pension funds invested in Nabors stock said they hope Isenberg's move is a turning point in the company's strained relationship with some of its shareholders.

In recent years, Nabors has become "the poster child for excessive pay and poor corporate governance," said John Keenan, corporate governance analyst for the American Federation of State, County and Municipal Employees.

"The board has ignored shareholders for so long," Keenan said. "I think now, the board is finally listening."

Shareholders' wrath

Last year, 57 percent of voted shares opposed Nabors executives' pay packages in a nonbinding advisory vote.

In a letter last September, a group of public pension funds chastised the board for disregarding shareholder demands for changes and called for the resignation of the compensation committee chairman and two other directors.

The next month, the board announced it would heed demands that effectively give shareholders more power over who's on the board.

The directors agreed to support proposals that give board members one-year terms instead of three-year terms and require uncontested nominees to win a majority of cast votes instead of a plurality.

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By Simone Sebastian