US court gives Voyager green light Voyager Digital to pay staff members $1.9 M in retention
A New York bankruptcy court has given besieged cryptocurrency brokerage Voyager Digital the green light to pay $1.9 million in retention bonuses to key staff members to ensure the beleaguered cryptocurrency lender can continue operating through bankruptcy proceedings.
The Firm filed a motion with the United States Bankruptcy Court on Aug. 2 for approval for its Key Employee Retention Plan (KERP) to 38 key employees that have been identified as vital to the exchange’s current operation.
Creditors of the firm had firstly opposed Voyager’s KERP payments in a court filing on Aug. 19 demanding that payments to investors should be listed ahead of “well-compensated” employees.
The court filings stated an agreement was reached between Voyager and the committee of creditors to support the proposed KERP on certain conditions. Chief among these is the execution of operational cost-cutting measures to save $4.6 million. The KERP payments are worth 22.5% of the eligible employees’ annual salaries.
Voyager stated that the 38 employees are critical to business operations, performing “essential accounting, cash and digital asset management, IT infrastructure, legal, and other critical functions for the Debtors.”
The court filing also spoke to concerns raised by the U.S. Trustee’s Office, which oversees the administration of bankruptcy cases and private trustees as an element of the Department of Justice.
The U.S. Trustees protested to the KERP proposal claiming that the list of employees set for retention pay-outs may have included “insiders” and that Voyager had not provided sufficient evidence to justify the proposed bonuses.
U.S. Bankruptcy Judge Michael Wiles at last approved the motion for the KERP payouts, approving Voyagers’ legal team’s assertion that none of the beneficiaries of the bonuses were appointed, sit, or report to the board of directors and do not have managerial control of the company.
