Relativity Media has named five top executives it wants to pay cash incentives for remaining at the bankrupt studio — but CEO and Chairman Ryan Kavanaugh is not listed among them, court papers filed Monday night said.
On the eve of its second bankruptcy hearing on Tuesday, the studio listed a group of “key employees” crucial to both daily operation and the tumultuous sale process underway. They include President Tucker Tooley, Managing Director Carol Genis, Co-Chief Operating Officer Greg Shamo and Chief Financial Officer Andrew Matthews.
Rounding out the list is Thomas Forman, CEO of the Relativity Television, whose retention is crucial since the TV division is the mini-major’s most profitable asset in the Chapter 11 filing.
Relativity confirms that it now counts 84 full-time employees among the film, TV and fashion divisions covered by the bankruptcy. The company once had as many as 350 full-time employees, including from enterprises in which the studio has a minority stake that are unaffected by the Chapter 11 filing: the sports management group, the for-profit Relativity Education and a joint film marketing and distribution entity with EuropaCorp.
“Relativity has created and is proposing these employee incentive and retention plans to help motivate and retain talent throughout the sale process, which will help us maximize the value of our assets,” a spokesperson for the studio said.
The terms of the Key Employee Incentive Plan (or “KEIP”) would pay out an estimated $314,868 in incentive bonuses for staying on board. The execs would be paid the day after the proposed sale closed.
A retention plan was also put forth to keep “non-insider” staff, since “attracting qualified employees at this stage in the debtors restructuring would be extremely challenging,” according to the documents. The retention plan would pay out a total of $589,126 to 80 eligible employees.
“The costs associated with the Retention Plan are significantly outweighed by the benefits that have been, and will continue to be, realized,” the documents added.
The incentives add to a long list of housekeeping that U.S. Bankruptcy Court Judge Michael Wiles will tackle on Tuesday in New York, as he will decide on matters including the expedited sale of Relativity’s assets to its sole bidder — a stalkinghorse group comprised of its senior lenders.