hhgregg filed with the U.S. Bankruptcy Court a motion for authority approving a key employee retention program ((KERP) for certain non-insiders.
The motion explains, “The KERP is structured to ensure the retention of 38 of the Debtors’ non-insider employees (the ‘KERP Participants’) whose efforts will be critical to completing the Debtors’ wind-down both during and after the conclusion of the Debtors’ store closing sales process and to maximizing stakeholder value in connection therewith. In addition to residual store closing work, this wind-down will include, among other things, transitioning the Debtors’ existing information technology systems so as to ensure the Debtors can vacate their corporate headquarters in a timely and orderly fashion (and retain critical records); disposing of any inventory and equipment that remains after the store closing sales; selling the Debtors’ intellectual property; collecting Debtors’ accounts receivable and “vendor credits”; prosecuting estate avoidance actions; and administering residual employee benefits and payroll.”
In addition, “In order to accomplish a successful post-closing wind-down, the Debtors seek to retain 12 of the 38 KERP Participants until at least June 30, 2017 (the ‘June 30 Group’), and an additional 21 until at least July 31, 2017 (the ‘July 31 Group’). The Debtors seek to retain one additional KERP Participant until August 31, 2017 (the ‘August 31 Group’), and the remaining four participants until March 31, 2018 (the ‘March 31 Group’). The KERP seeks to retain only a small percentage of the approximately 4,700 individuals employed by the Debtors as of March 2017. The Debtors propose to award KERP Participants the aggregate sum of up to $500,000 in bonuses.”
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