Intelsat: U.S. trustee objects to $21.92 million employee bonus plan

By Sarah Lizee

Olympia, Wash., Dec. 18 – Intelsat SA’s proposed key employee incentive plan for 2021 drew an objection from the U.S. trustee overseeing the case, according to Friday filing with the U.S. Bankruptcy Court for the Eastern District of Virginia.

The maximum awards payable to the eight KEIP participants would be $21.92 million, as previously reported.

“Despite there not being a clear path to exit these proceedings, the debtors are proposing a second KEIP motion, this one seeking authority to pay up to just under $22 million in bonuses to eight of its highest compensated executives,” Region 4 U.S. trustee John P. Fitzgerald, III said.

“This is in addition to tens of millions of dollars that some of these same executives received in bonuses over the past year. In fact, six of the eight executives covered by the 2021 KEIP motion received approximately $7 million in retention bonuses shortly before the bankruptcy filing, $9,151,338 in bonuses for the second and third quarter of 2020 under the 2020 KEIP, and an are owed an unknown amount in bonus payments for the fourth quarter of 2020 under the 2020 KEIP.”

Fitzgerald said that since the fourth quarter of 2020 has not ended, and the debtors will not have the financial results until late January, the court should continue the hearing on the KEIP motion until those results have been finalized in order to permit a complete assessment of the KEIP.

Intelsat is a Luxembourg City, Luxembourg-based satellite telecommunications company. The company filed bankruptcy on May 14, 2020 under Chapter 11 case number 20-32299.

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