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Bankrupt Borders Execs Seek Bonuses

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Sept 5 – Sept 11, 2011 Edition Bankrupt Borders Execs Seek Bonuses

Executives of the bankrupt Borders Books will be back in the Southern District of New York Bankruptcy Court this week seeking $1.75 million in bonuses for management. The Key Employee Incentive Plan (KEIP) was approved by the court in April to encourage Borders’s senior management to stay on to either reorganize or sell the company. The severance package calls for $125,000 each for 15 managers who were terminated July 29. Included in that group is former CEO Mike Edwards and former CFO Scott Henry.

Meanwhile, employees who were laid off at the company’s Ann Arbor headquarters have filed a class action law suit asking for their severance pay. On Friday, Jared Pinsker, who was terminated on July 23, filed for 60 days of unpaid wages and benefits under WARN, the Worker Adjustment and Retraining Notification Act of 1988, for himself and 300 other employees.

Both issues are likely be reviewed at this week’s hearing on Thursday, September 8 in Judge Martin Glenn’s courtroom in New York. Also, that hearing will include approval of the bidding and auction procedures for sale of unexpired nonresidential real estate property leases.