The U.S. Trustee filed with the U.S. Bankruptcy Court an objection to iHeartMedia’s motion authorizing and approving the Debtors’ 2018 Incentive Plans. The Trustee asserts, “The Debtors seek Court approval of the 2018 Incentive Plan for Insiders (‘IPI’). More specifically, the Debtors seek an order approving bonuses under the IPI to eleven (11) insiders who are members of the Debtors’ senior management team. The Court should deny approval of the IPI because it violates the strict limitations imposed by section 503(c) of the Bankruptcy Code. Despite the Debtors’ attempts to disguise the IPI as an ‘incentive’ plan, the bonuses are primarily retentive in nature and thus subject to section 503(c)(1). And even if subject to the standards in section 503(c)(3), the Debtors have not shown that the IPI is justified by the facts and circumstances of these cases. The Court should not approve the Motion under either framework.”
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