CEO takes company from $40 a share to bankruptcy, now wants $25 MILLION severance pay!!

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Former Warnaco CEO Linda Wachner seeking dlrs 25.1 million in severance

Thu Aug 8, 7:18 PM ET

By ANNE D'INNOCENZIO, AP Business Writer

NEW YORK - Linda Wachner, the former chief executive of bankrupt apparel giant Warnaco Group Inc., is demanding dlrs 25.1 million in severance from her former employer. And the feisty executive, once highly revered on Wall Street, wants her claim to be granted ahead of those of other unsecured creditors.

In a pleading that is making its way through the U.S. Bankruptcy Court for the Southern District of New York, Wachner's lawyers said she earned the amount, and wants the claim to be treated as an administrative expense, which is entitled to top priority under bankruptcy law.

The amount was calculated according to the former CEO's employment contract that allowed for a severance payment based on multiplying Wachner's highest base salary and recent bonuses. It also includes the value of certain accrued benefits and unreimbursed expenses, according to court papers.

Wachner's attorney Kenneth H. Eckstein of the law firm Kramer Levin Naftalis & Frankel, could not be reached for comment.

When Wachner was fired in November 2001, five months after Warnaco filed for bankruptcy protection, the board decided not to pay her severance. Wachner filed a "Proof of Claim" in January 2002, and in the most recent documents, filed with the court on Aug. 2, Wachner's lawyers claim that she brought valuable contributions to the company during both the "pre-petition and post petition" period. Further, because Wachner was fired after the company filed for Chapter 11, she is entitled to that severance package.

The court papers also said that Wachner "put her money where her mouth was by remaining heavily invested in Warnaco stock throughout the last two difficult years. As a result, Wachner has seen a substantial portion of her net worth wiped out."

Doug Morris, a spokesman for Warnaco, declined to comment. In court papers, Warnaco has argued that Wachner's claim has no merit, and has teamed up with its creditors and bankers to fight the claim.

Wachner's fight in court represents a big effort to salvage her tarnished image. According to court papers, Wachner's lawyers said she "has suffered significant professional and reputational injury" as a result of being fired.

Wachner transformed a once sleep bra company into a dlrs 2.25 billion apparel machine, whose products range from Calvin Klein jeans to Olga bras and Speedo swimsuits. But since mid-1998, the company's business began to unravel, hurt by a reduction in demand for its products and fast-eroding market share.

A high profile dispute with Calvin Klein, settled in January, also hurt its core licensed Calvin Klein jeans and intimate apparel businesses. Analysts have blamed Warnaco's woes in part to what they believe was a combination of Wachner's ego and financial self-interest.

The company listed dlrs 2.37 billion in assets against dlrs 3.08 billion in liabilities in its bankruptcy filing and is now fighting for survival.

-- bwaahahaha!! (dream on @ pig. bitch), August 09, 2002

Answers

This is how Democrats do business I guess. The Booming Clinton Economy was the biggest farce ever hoisted on the public.

-- streisand (streisand@here.now), August 10, 2002.

I see nothing in the article to indicate that this woman is either a Republican or a Democrat.

I would suspect, from the way she's acting, that she was a devoted follower of Ralph Nader. I could be wrong.

-- Peter Errington (petere7@starpower.net), August 10, 2002.


You're confused Error boy, Nader opposes the greed and irresponsibility in corporations that this bitch has demonstrated so well.

-- (I'll bet my left nut @ she's. a pug), August 10, 2002.

You don't have a left nut, kiddo.

-- Peter Errington (petere7@starpower.net), August 10, 2002.

Well I guess you would know better than me, given the amount of time you spend down there.

-- (blow me again @ now. please), August 10, 2002.


Well, maybe you're not LL. Maybe we have two Nader admirers.

-- Peter Errington (petere7@starpower.net), August 10, 2002.

Nope, I don't admire politicians, I condemn corporate greed and corruption. If Nader is big enough to try to end it, I say more power to him.

-- (wrong@again.dimsung), August 10, 2002.

Yes, but consider the fact that Nader is an egomaniac. This group hasn't seen anything like that since the fool who called himself Ra the Sun God.

-- Peter Errington (petere7@starpower.net), August 11, 2002.

Peter, are you referring to the poster that used the handle, Rational 1? Havenít seen him/her in these parts for quite a spell. How did you arrive at Ra the Sun God? If we are talking about the same person then you would also be mistaken about the Ďfoolí label. Iím beginning to understand why so many folks call you Errorton.

-- Been (here@long.time), August 11, 2002.

Hmmmm, since Dumbya is an egomaniac and he's the pretzeldent, maybe Nader is on the right track. The only thing Nader needs to do now is destroy his brain so that he will be as dumb as Dumbya, then he's got a good chance.

-- (yeah @ that's. the ticket), August 11, 2002.


To "Been here":

I'm referring to Barry, who went thru a long period of calling himself just plain "Ra".

-- Peter Errington (petere7@starpower.net), August 11, 2002.


No Peter, if you are referring to Barry, his handle was Ra tion@l.1

Surprised you didnít pick that up.

-- Been (here@long.time), August 11, 2002.


He named himself "Ration"?! Ration of what? Hogshit, if you ask me.

No, I think I recall a long stretch when he was just plain Ra. Anybody with a long memory agree?

-- Peter Errington (petere7@starpower.net), August 11, 2002.


Just for the record, checking a post on the old board, one of Barry handles was: -- Ra(tion@l.1), so you're both right, sorta.

-- Aunt Bee (Aunt__Bee@hotmail.com), August 11, 2002.

Ra is still posting on this board, but he has changed his handle to the nigger-hating redneck pug known as "Free head jobs". He may also be posting as "Oink", but that is more likely the Roloboy.

-- (the@inside.scoop), August 11, 2002.


To "inside scoop":

Having recently mixed it up with the cowardly "Oink", I would bet my house against a donut that Oink is not Roland.

-- Peter Errington (petere7@starpower.net), August 11, 2002.


Oink is probably Flint.

-- (my@best.guess), August 11, 2002.

Aunt Bee, I believe you are correct and the full translation was to imply that Barry was the Ďrational oneí, in a crowd of irrational posters. Thatís how I perceived the meaning of his handle. Iíve seen many a poster using similarly clever alphanumeric combinations that will bring consternation to the Ďthick in headí folks. Peter here has taken two shots at this one and still comes up empty.

Ummmm.

-- Been (here@long.time), August 12, 2002.


Been here a long time...

Hard to tell, with that handle! You haven't been here long if you're not willing to be honest enough to tell us who you are, at least not in my book.

And, IME Peter is probably one of the most intelligent posters on this board.

Sorry HTT, you just have no credibility in my book. At least Peter says what he thinks and doesn't play troll. Just my two cents.

-- Aunt Bee (Aunt__Bee@hotmail.com), August 12, 2002.


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