Corsicana Mattress receives approval of key employee incentive plan

By Sarah Lizee

Olympia, Wash., Aug. 9 – Corsicana Bedding, LLC, which does business as Corsicana Mattress, had its motion seeking approval of an up to $980,000 key employee incentive plan approved by the U.S. Bankruptcy Court for the Northern District of Texas.

As previously reported, Region 6 U.S. trustee William T. Neary had asked the court to deny the motion, because one of the 43 proposed participants in the plan is an insider.

The U.S. trustee said that since the motion indicates that it is intended as a retention bonus, the debtors should be required to put on evidence that the KEIP meets the standards of bankruptcy code for both non-insiders and the one insider.

“The proponent of a purported ‘incentive’ plan bears the burden of proving that the proposed plan is not a pay-to-stay retention plan governed by § 503(c)(1),” Neary said in his objection.

The court said in its order approving the plan that the debtors cannot make any payments under the KEIP to insiders.

The Corsicana, Tex.-based mattress company filed Chapter 11 bankruptcy on June 25 under case number 22-90016.

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