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Kodak executives received a total of $15.6 million in bonuses and other payments in the 12 months prior to filing for bankruptcy. That’s according to a Wall Street Journal database. CEO Antonio Perez received nearly $2 million in bonuses, stock wages and other benefits.

The WSJ looked at a number of companies that enriched executives in the months leading up to bankruptcy. The newspaper called it “Payday Before Mayday.” Hostess is among the companies that paid officials big bucks before going belly up:

To avoid running afoul of limits on bonuses that reward executives for sticking around during bankruptcy, companies craft incentive plans that compensate managers for meeting certain performance targets. But another way they can steer clear of the law’s restrictions is by paying bonuses before filing for Chapter 11.


Companies often say they are using their best business judgment when paying bonuses to executives who are working overtime to keep operations afloat. A firm’s fate often isn’t known when bonuses are paid, and companies argue they must motivate some executives to stay lest they suffer exoduses that further destabilize troubled situations.

The WSJ found more than 1,600 top-level executives at 80-plus companies got more than $1.3 billion in payments before their companies filed for Chapter 11.

Links of the Day:

– Communities are discovering the value of being walkable. Williamsville is redoing its highway-like Main Street.

– Governor Cuomo shot down a proposal to implement a booze tax and place limits on bars and liquor stores in an effort to curb problem drinking.

– Are Common Core standards sacrificing literature for nonfiction?

– Chicago is planning to raise money by installing digital billboards on city-owned land along expressways. Coming soon to a city near you?

This made my day:

7 Responses to “Payday Before Mayday”

  1. December 4, 2012 at 9:30 am Alexei Tetenov responds:

    For this link, I think that it should be “Core” instead of “Store”…

    – Are Common Store standards sacrificing literature for nonfiction?

  2. December 4, 2012 at 10:34 am Ginny Maier responds:

    And because the compensation can be treated like a capital gain instead of income, it gets taxed at a lower rate. It’s maddening that we are still fighting over whether to raise income taxes on income above $250,000, when there are so many examples of this type.

    Thanks for the photo, though. So funny!

  3. December 4, 2012 at 11:10 am theodore kumlander responds:

    the funny part is. it is the excutives that are the problem. there is no shortage of demand for Hostess products and the bakers union was negosiating a second contract of pay and benfit cuts.

    The excutives made more money bankrupting the company. Mitt Rommny would love these guys.

  4. December 4, 2012 at 7:18 pm Orielly responds:

    Funny how many in the local media cite Perez and never mention the money made by Xerox’s CEO.

    Funny how many in the local media cite Perez and never point shame on Joel Seiglman UR PREZ who is on the Board at Kodak and vote his approved these outrageous Bonuses.

    Funny how a Kodak sales person would be fired time and time again if their results matched Perez vs Him receiving a bonus.

    Perez is laughing all the way to the bank, and the Kodak board is who the media should expose…. but for some reason… they don’t?

  5. December 4, 2012 at 7:56 pm Animule responds:


    How about you get on the horn and arrange an interview with University of Rochester Prez and Kodak Board of Directors member Joel Seligman?

    I am just dying to hear why Joel would sign off on a management team and CEO that approves of such practices. It would be good to know if his professors over there at the Simon School are teaching these future business leaders to a loot a company before the declare the carcass bankrupt.

    It ought to make for one heck of an interview.

  6. Get rid of the CEO perez and preserve the retirees health care benefits.

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