Cosi filed with the U.S. Bankruptcy Court a motion for an order approving a key employee retention program (KERP).
The motion explains, “As a multi-unit fast- casual restaurant chain, the retention of trained employees is critical to maintaining the value of the Debtors enterprise. The remaining approximately 1081 employees are necessary and vital to ensuring that operations continue uninterrupted during the Chapter 11 period. In order to reduce the potential employee losses and the damages that such losses would do to company value, the Debtors request approval of the KERP. The KERP is designed to provide certain employees with financial incentives to remain with the Company (the ‘Retention Benefits’). Specifically, the participants in the proposed KERP identified to date are approximately 125 valuable, hard to replace employees.”
The motion continues, “Under the proposed KERP, Participants will have the ability to receive three cash ‘bonus pool’ payments, payable as follows (a) a 30 day pay- out equal to 30% of the designated bonus pool; and (c) a 90- day pay out equal to 40% of the designated bonus pool. The proposed designated bonus amounts for each Participants range from $710 to $8,000. The total proposed amount anticipated to be paid under the KERP is approximately $ 258,000.”
Read more bankruptcy KERP news.