- The Washington Times - Friday, January 24, 2003

HOUSTON, Jan. 24 (UPI) — Enron Corp. is asking a federal bankruptcy judge to approve another $29 million in bonuses to keep workers the company says are essential to its Chapter 11 reorganization.

After more than a year in bankruptcy, the Houston company is asking Bankruptcy Judge Arthur Gonzalez in New York to authorize the bonuses for about 900 current employees, the Houston Chronicle reported Friday.

The request is in addition to a $140 million retention plan approved last April and $105 million in bonuses paid after Enron filed for bankruptcy in December 2001. A portion of that retention plan is scheduled to expire at the end of February.

Gonzalez is scheduled to hear the request Feb. 6.

"We want to have continuity going forward, and there's considerable uncertainty with the first plan ending," said Enron spokeswoman Karen Denne.

The company has the support of its creditors committee, made up of the largest unsecured creditors, she said.

At the time the $140 million retention plan was approved the company argued it would lose 87 percent of its employees in a year without help. Since the adoption of the plan, the company has gone from losing 37 workers a week to nine a week.

Some Enron creditors are questioning the need for more bonuses when many of Enron's remaining assets may be auctioned off before the February 2004 date to which the retention plan binds employees, the Chronicle reported.

"Enron has been a feast for professionals and insiders, but so far it has done nothing but have a reduced promise for any meaningful return for outside creditors," said David Bennett, a lawyer representing creditors of Enron North America.

Enron has set new records for spending on bankruptcy lawyers and accountants, racking up more than $300 million to date, according to the Chronicle.

Enron contends the current employees are needed because they have the critical knowledge needed to liquidate certain assets and respond to other demands of the Chapter 11 reorganization.

Bennett said Enron should disclose how much of the bonus money from the $140 million retention plan is still available before asking for more bonus money.

The plan included $40 million in retention payments for 1,285 employees, up to $90 million in incentive bonuses for workers who helped sell assets and conclude contracts, and $7 million in severance payments for about 842 dismissed workers.

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