Bankruptcy Compensation Consultation

$10B Automotive Company

Background

  • The company handles car leasing for business and pleasure travel and automotive secondary market services (used car sales)
  • They also operate commercial fleet management services

Contributions

  • Provided a legally-defensible, precedent-backed, financially-sound, and socially-equitable recommendation for appropriate incentive program size, cost, and performance measure components
  • Performed extensive data mining of bankruptcy case information for the past decade, then refined that data into a logical, quantitative, and transparent framework that could serve as a compelling argument for all stakeholders

Results

  • The initial proposal was approved in partial form by the bankruptcy court
  • The portion that was rejected was not approved because the client had (in the period immediately prior to their bankruptcy petition) paid out several million dollars to executives, in addition to the proposed program
  • The company opted to pursue a new proposal for 2021 that likely has a better chance of acceptance by both the creditors and the court