A&P Reveals Executives Who Received Millions before Bankruptcy Filing

by San Antonio Attorney

The full disclosure of money paid to top A&P executives just months  before the supermarket chain sought for bankruptcy protection, has brought up renewed issues regarding executives who have been suspected of enriching  themselves while their employees and creditors suffered.

Payments from a questionable $6 million trust to A&P executives was revealed several weeks ago, but particulars about these as well as other payments were not disclosed until late this week in a bankruptcy court filing.  The bankrupt company is required by law to make a list of payments to corporate insiders that were made a year before the Chapter 11 filing.

The details of financial statement revealed that A&P’s chairman Greg Mays, collected $4.6 million in consultation fees along with other payments a year before the bankruptcy filing in July 19.  The amount includes a $2.5 million payment which came from special trust.  Chief Executive Paul Hertz gained a $1.5 million trust payment plus a $225,000 bonus, based on the document.

Chief Administrative Officer Christopher McGarry collected $2.3 million, which constitutes his salary, trust payment and bonus.

Experts did not comment about the amount of the payments since they are unfamiliar with how the company compensates its employees, but for them the timing is questionable.

Union officials, who have fought A&P over severance and other issues, expressed frustration because according to them, the top executives were wasting money while the workers were fighting to get a small amount of payment.

As part of the bankruptcy plan, laid-off members of the union receive about half of the severance stated in the union contract.  The average amount is $5,000.

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