Under Voyager’s “key employee retention plan” or KERP, the company will be allowed to make payments to its non-insider employees whom the company sees as key assets for their revival plans.
Troubled cryptocurrency lender Voyager Digital filed for Chapter 11 bankruptcy last month following the Q2 2022 market crash and severe liquidations. Federal court judge Michael Wiles recently signed orders allowing crypto lenders to pay up to $1.9 million as Voyager Digital’s employee retention bonuses.
Retention Bonuses for Voyager Digital’s Employees
Reportedly, there are 30 employees of Voyager eligible to receive the “retention” award. Judge Michael Wiles agreed to seal their names and titles. Voyager’s “key employee retention plan” or KERP will allow the troubled crypto lender to make payments to its non-insider employees whom the company sees as key assets for their revival plans.
Voyager said that the compensation for those employees has changed in recent months as their equity depreciated. In its request for the funds Voyager noted:
“The departure of the Debtors’ key employees during these chapter 11 cases would destroy value, harm the Debtors’ restructuring process, and adversely affect the Debtors’ ability to operate in the ordinary course upon emergence”.
Objection to Voyager’s Proposal
The troubled crypto lender Voyagel digital had filed for authorization earlier this month which was opposed by the company’s creditors last Friday. Bankruptcy watchdog US Trustee’s Office, operating under the Department of Justice, also objected to the potential recipient’s names and titles, adding that they might not be eligible to receive the bonuses. But during the hearing, Michael Slade, an attorney with Kirkland & Ellis representing Voyager, said:
“This program does not involve the senior management team, and data about these individuals would typically not exist in the public domain. We note that no creditor or shareholder or economic stakeholder has objected to the motion to seal. We provided this information to the UCC [Official Committee of Unsecured Creditors], which was the only party to ask us for it and the United States Trustee’s office. The information has not been withheld from anyone who asked for it”.
Richard Morrissey, an attorney with the US Trustee’s office has called Voyager’s concerns “speculative”. Morrissey noted that hundreds of his customers have asked his office questions about the process.
During the hearing, Voyager Digital confirmed that no senior management positions would qualify among those employees receiving the retention money. Furthermore, Slade that Voyager is implementing some cost-cutting measures over the next month. This could further results in annual savings of $4.6 million.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
Ecosystem
Research
News Network
About