NEW YORK — An attorney for Caldor Corp. said Thursday that the discounter has pulled its controversial $20 million bonus retention plan off the table while it negotiates a more acceptable plan with its creditors.
As reported, Caldor alienated some shareholders last month with a proposal that would have paid its executives to stay with the company through the Chapter 11 period, whether or not the chain improved its financial performance.
Caldor’s new bonus plan is expected to include performance-based incentives.
Sara Chenetz, an attorney with Marcus Montgomery and counsel to some of Caldor’s shareholders, said the shareholders will soon gain an official place at Caldor’s reorganization. Marcus Montgomery helped lead the shareholder revolt against the original retention plan.
Chenetz said Thursday the U.S. Trustee’s office told her that it will appoint an official equity committee by Dec. 22. Chenetz said a consensual agreement between Caldor and creditors on a retention plan will probably be ready sometime after the committee is appointed.
The hearing Thursday came less than 24 hours after it was revealed that Caldor considered merging with rival Bradlees Inc. in April. Bradlees’ board rejected the offer, and Caldor now says a merger is no longer being discussed.
Caldor, however, noted that the chain will do whatever is in the best interests of the company and its creditors.
— Fairchild News Service

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