Anthonys Proposes Executive Compensation Plan

Article excerpt

By Nancy Raiden Titus Journal Record Staff Reporter C.R. Anthony Co. has asked for bankruptcy court approval of a new executive compensation plan, which would reduce some salaries but would give executives incentives for early confirmation of a plan of reorganization.

If approved, certain top executives would share in a $750,000 bonus pool, which would be paid on a point system based on the date of confirmation.

The company estimated that the new plan would provide $175,000 in annual savings to the estate and would "sacrifice certainty of compensation in order to incentivize management," according to the motion filed Friday at the U.S.

Bankruptcy Court for the Western District of Oklahoma.

The company's request seeks to have the court void its previous employment contracts with its executives and replace them with the new plan, which also includes a severance plan for all Anthonys employees.

The Oklahoma City-based retailer has been under Chapter 11 bankruptcy reorganization since February. It currently employs approximately 4,800 to 5,000 people.

The court document said executive pay is "critical to the success of the reorganization."

The exact terms of the compensation plan were not revealed because of their proprietary nature, but the filing said a survey of retail compensation data showed that both the existing compensation plan and the proposed one are "well below" industry averages.

Salaries are to continue at the rates paid before the bankruptcy filing, but the effective amount of the new plan is reduced because executive health insurance and car allowances not available to rank-and-file employees are eliminated. …