Chapter 11 Treatment of Executive Compensation and Bonuses
Structuring Approvable KEIPs and KERPs, Surviving Objections
Recording of a 90-minute CLE video webinar with Q&A
This CLE webinar is about key employee incentive plans (KEIPs), key employee retention plans (KERPs), and other executive compensation payments before, during, or after Chapter 11 bankruptcies. The panel will discuss the thin line between Bankruptcy Code Sections 503(c)(1) and (c)(3), how to create approvable programs, burdens of proof, and overcoming objections, taking examples from influential courts. The panel will also identify possible securities law issues for publicly traded companies.
- Options for executive compensation before and after bankruptcy filing
- The importance of timing
- KEIP vs. KERP
- Requirements for approval
- Common objections
- Evidentiary issues
The panel will review these and other pivotal issues:
- How do courts decide whether a KEIP target genuinely incentivizes insiders?
- What does "justified by the facts and circumstances of the case" in 503(c)(3) mean?
- Are bonuses justified when parties have negotiated a pre-filing sale?
- How should debtors document each person's contribution to a reorganization effort?
- How should counsel document the achievement of milestones, if needed?
- What are the methods to determine reasonable compensation amounts?
Marty L. Brimmage, Jr.
Akin Gump Strauss Hauer & Feld
Mr. Brimmage is a trial lawyer with a nationwide reputation of delivering favorable results to clients. He is... | Read More
Mr. Brimmage is a trial lawyer with a nationwide reputation of delivering favorable results to clients. He is particularly adept at developing litigation and trial strategies, and addressing matters on appeal. Mr. Brimmage is the lead litigation partner on a full range of disputes in complex Chapter 11 proceedings and other restructuring related issues for debtors, official committees of unsecured creditors, other secured and unsecured creditors, bondholders and ad hoc groups. He is also lead trial counsel for litigation teams in energy, mining, real estate and telecommunications matters across the country.Close
Alvarez & Marsal
Mr. Cumberland leads the firm's Restructuring Compensation practice. With over 30 years of... | Read More
Mr. Cumberland leads the firm's Restructuring Compensation practice. With over 30 years of experience, Mr. Cumberland provides executive compensation advice to clients, development of compensation strategies, design of annual and long-term compensation arrangements, assessments of competitive compensation, and evaluation of tax and accounting ramifications of compensation arrangements. In advising on executive compensation matters, he regularly deals with issues related to stock options, restricted stock, non-qualified retirement plans, deferred compensation, critical employee incentive programs (KEIP) and essential employee retention programs (KERP), global compensation strategies, golden parachute rules, and the one-million deduction limitation.Close
Scott D. Price, PC
Kirkland & Ellis
Mr. Price is a partner in the Firm’s Executive Compensation Practice Group. He has extensive... | Read More
Mr. Price is a partner in the Firm’s Executive Compensation Practice Group. He has extensive experience handling a wide range of executive compensation matters in complex business transactions, including domestic and international mergers, leveraged buyouts, and other acquisitions. In addition, he has represented numerous high-profile executives and management teams in negotiating employment and incentive arrangements. His practice includes structuring and implementing management equity arrangements, deferred compensation, severance, and other executive programs, advising on securities, accounting, and tax law issues regarding executive compensation arrangements.Close