Sing in doorway of a closed Borders

At a hearing in New York yesterday, a U.S. Bankruptcy Court Judge sternly instructed Borders to rethink its bonus plan for leading company executives, says a Bloomberg News wire story. However, Borders lawyer Bruce Buechler persisted in arguing for the bonuses, telling the judge that since filing its second motion requesting the bonuses just Wednesday, the company had revised the plan that very day so that “the five top executives, including Chief Executive Officer Mike Edwards and Chief Financial Officer Scott Henry, would be paid based on how much they recover for creditors under a sale or restructuring by Aug. 15.” Buechler told the judge, “we need management not just to be there, but to be cheerleaders or affirmative spokespeople for the company.”

Judge Martin Glenn responded that, “If this business goes down the toilet bowl, there are a lot of full or part-time employees who face the prospect of going out of work,” before instructing the company’s attorneys to meet immediately with the U.S. Trustee in the hall outside the courtroom and negotiate a deal. The U.S. Trustee — the Justice Department‘s “bankruptcy watchdog” — had earlier voiced strong opposition to the bonus plan.

As per an earlier MobyLives report, the bonus plan would have given CEO Edwards, who has a salary of $750,000, a bonus of as much as $1.7 million. The plan called for other top executives to receive as much as 90% -150% of their base pay.