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US retailer GC Penny is starting to give millions of dollars in salary bonuses to top executives, while a struggling chain of stores is on the brink of bankruptcy.
The company revealed on May 10 that CEO Jill Solto received $ 4.5 million, while Chief Financial Officer Bill Waverford, Chief Commercial Officer Michael Laszlo and Chief Human Resources Officer Brian Evanson received $ 1 million.
These payments are intended to ensure that JC Penny motivates its executives and other employees to cope with the volatile environment caused by the emerging Corona epidemic, which has affected retail sales in the United States and elsewhere.
The 118-year-old company is one of many retailers that have been forced to temporarily close as the coronavirus spreads across the United States, “sending it more than a step into bankruptcy,” according to CBC News.
For its part, Reuters reported that the company plans to file a Chapter 11 bankruptcy with authorities, which could lead to the closure of nearly a quarter of its 850 US stores permanently.
Chapter 11 of the United States bankruptcy law allows companies to reorganize under the law.
This procedure is available to all types of companies that cannot pay debts or pay creditors, as companies or creditors can file for bankruptcy protection under Federal Chapter 11.
Sources told Reuters that, under one of the plans under discussion, JC Penny would emerge from bankruptcy as two separate companies.
GC Penny’s online sales were not enough to offset the huge losses she incurred while keeping stores closed across the United States in response to closings aimed at slowing the spread of the coronavirus.
While the company has enough cash to survive in the coming months, it faces debt payments of $ 105 million maturing in June and some $ 300 million in annual interest expenses, along with more than $ 2 billion in debt maturing in a year. 2023.
