Trustee in Celsius bankruptcy case slams $3 million bonus motion for employees
The trustee objected to the retention bonus, citing a lack of sufficient information in the petition to justify such a high payment and a lack of clarity as to whether certain recipients should be considered insiders.
New
The U.S. trustee overseeing Celsius's Chapter 11 bankruptcy case, William Harrington, has opposed a motion by Celsius that would see 62 of its 275 employees paid a retention bonus totaling $2.96 million dollars.
The trustee blasted Celsius in its statement supporting the objection filed on October 27, noting:
"It defies logic, let alone the Bankruptcy Code, that a company whose majority of its functions no longer provide services now offers a multi-million dollar bonus scheme."
For the aptly named "bonus motion" to receive approval, the trustee says Celsius must show that the bonuses are reasonable based on the facts of the case. Without any identifiable action, the trustee claims Celsius failed to do so.
While the objection does not infer that Celsius employees do not deserve an essential employee retention program (KERP), it does indicate that the information provided by Celsius is insufficient to justify such a high amount.
KERPs are designed to motivate employees to drive a successful restructuring forward. While increasing executive compensation ahead of a possible restructuring may seem counter-intuitive, it can often be in the best interests of stakeholders.
Related: Quebec Pension Fund Loses Nearly All Of Its Celsius Investment In Less Than Ten Months
Unlike the
The trustee objected to the retention bonus, citing a lack of sufficient information in the petition to justify such a high payment and a lack of clarity as to whether certain recipients should be considered insiders.
New
The U.S. trustee overseeing Celsius's Chapter 11 bankruptcy case, William Harrington, has opposed a motion by Celsius that would see 62 of its 275 employees paid a retention bonus totaling $2.96 million dollars.
The trustee blasted Celsius in its statement supporting the objection filed on October 27, noting:
"It defies logic, let alone the Bankruptcy Code, that a company whose majority of its functions no longer provide services now offers a multi-million dollar bonus scheme."
For the aptly named "bonus motion" to receive approval, the trustee says Celsius must show that the bonuses are reasonable based on the facts of the case. Without any identifiable action, the trustee claims Celsius failed to do so.
While the objection does not infer that Celsius employees do not deserve an essential employee retention program (KERP), it does indicate that the information provided by Celsius is insufficient to justify such a high amount.
KERPs are designed to motivate employees to drive a successful restructuring forward. While increasing executive compensation ahead of a possible restructuring may seem counter-intuitive, it can often be in the best interests of stakeholders.
Related: Quebec Pension Fund Loses Nearly All Of Its Celsius Investment In Less Than Ten Months
Unlike the
What's Your Reaction?
