Bankrupt Solyndra: Let Us Give Bonuses

Lawyers for the bankrupt Fremont, California maker of tube-shaped solar panels at the center of a half-billion-dollar taxpayer loss have asked a judge's permission to give out bonuses (boni?) to high-paid employees. 

Solyndra LLC entered bankruptcy this fall after liquidating a $518 million taxpayer-guaranteed loan. Reason's Mike Riggs earlier noted this story by Jim McElhatton in the Washington Times

The attorneys say the extra money will add motivation at a time when workers at the solar company have little job security and more responsibilities because so many of their colleagues have been fired.

The names of the bonus-eligible employees are not disclosed in the court filings that outline the bonus proposal. None of the employees is among the so-called corporate “insiders” — top officers or members of the board of directors, records show.

The proposed bonus recipients include nine equipment engineers, six general business and finance employees and up to two information technology workers.

The biggest bonus, for $50,000, would go to a Solyndra employee whose job title is listed as a senior director with a base salary of $206,499 per year. Two senior managers stand to receive bonuses of $30,000 and $32,500.

Bankruptcy attorneys said the so-called “key employee incentive plan” aims to keep important personnel from leaving the company.

The saddest part is that you can understand how this might make sense to somebody. If the needs of the bankruptcy process are best served by maintaining the Solyndra rump as a functioning business, you do need to attract top talent at competitive salaries. (And employee compensation has continued to creep up in this devastating recession of grinding poverty and brutal austerity.) 

But why, beyond fulfillment of as many existing contracts as possible, is there any value in maintaining a business? The auction of Solyndra drew very little interest. The product drew little demand in the market. Yet it maintains a sales mechanism and, according to a court filing, sales people: 

Within the last few months, the debtors have experienced a serious loss of personnel, which has made the continuation of the sales process in an orderly fashion more difficult. 

Here’s the Solyndra sales page, where you can still read up on the white-roof tax break that is available, thanks to intercession from the Department of the Treasury, to buyers of Solyndra panels. Recommended: Question 13, explaining what lease terms "may improve the likelihood" of your becoming eligible for the Internal Revenue Service's investment tax credit. 

Previous coverage: 

I, Panel

Nobel laureate Steven Chu fails to explain what a Secretary of Energy does to the House of Representatives. 

And who can forget “They about had an orgasm in Biden’s office when we mentioned Solyndra”? 

I said the Solyndra scandal seemed to be winding down a few months back, but I did reserve the right to break out the tanning mirrors and the Bermuda Shorts and continue soaking in the energy right up on glory’s own white roof. 

For my comeback, I catalogued the Solyndra bag of goodies with Allen Barton on The Front Page

All Reason Solyndra coverage.

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  • annonymous commenter some guy||

    They need a bonus as an incentive to work hard? I would think not getting laid off when the company goes completely belly-up would be incentive enough...

  • ||

    six general business and finance employees and up to two information technology workers.

    Those books won't cook themselves, you know. And getting rid of incriminating records is a lot more complicated than paying some intern to feed files into the paper shredder all the livelong day.

  • ||

    The attorneys say the extra money will add motivation...

    It would add to my motivation to pay taxes if we had the extra money invested in Solyndra back in the treasury. Oh wait...

  • CultOfPersonality||

    Hold your breath for as long as you can...Starting now.

    By the time it takes before you gask for air, I guarantee Barry has apportioned $518 million of tax-payer money.
    Small potatoes.

  • Mr Whipple||

    Are they in Chapter 11 or 7?

    Liquidate the fuckers.

  • ||

    But why, beyond fulfillment of as many existing contracts as possible, is there any value in maintaining a business?

    They have a fiduciary duty to any outstanding investors to run the business and protect the investors' investments as best as they possibly can.

    One of the best reasons I can think of not to give companies like this money is that it gives the general public and their representatives the right to weigh in on how a business is run...

    I didn't care how GM ran its business until, through a government bailout, I became financially responsible for turning that company around.

    The sick thing is that this is exactly the sort of thing Barack Obama and Co. want. Obama Inc. wants the general public to think it should have a say in how every major company runs itself. But senior investors shouldn't have to explain to the general public why they continue to fight to recoup their losses and preserve as much of their initial investment as possible.

    ...from Barack Obama's perspective, though, that's a win/win. Private companies get access to public money, and the general public starts to believe that corporate executives everywhere should have to justify their decisions to voters and their representatives in Washington.

  • ||

    Couldn't have said it better myself. This plays perfectly into the progressive rulebook, they give out subsidies encourage the things they want to encourage, can point to those tangible buildings as where they "helped create jobs." And when a so-called "capitalist" enterprise goes belly-up, we the public, get to be justifiably angry, because it was our money at stake. Such a disgusting, vile, vicious cycle, and it just programs the general public to think "yeah, I SHOULD have a say in this."

    Damnit this makes me so angry.

  • ||

    Damnit this makes me so angry.

    It should make more people angry, too!

    It bugs me that more of my fellow libertarians don't see this for what it is.

    This is very much the same playbook the Obama Administration was calling plays from when it jumped all over the investment industry. I remember when Congress made it against the law for the TARP recipients to pay their TARP money back!

    Why? Because having that TARP money was the justification Obama and Company needed for why the government should get to run your bank!

    There is nothing about a company taking taxpayer money that a progressive like Obama doesn't like. If you listened to the Occupy movement, all these years later, they were still blaming the greed of the banks for what Barack Obama did.

    How cool is that for Obama? He can squander $350 billion bailing out Wall Street and nationalizing 2/3rds of the American auto industry, and when the banks pay the TARP money back, he used it for "stimulus", which the states used to keep their state employee payrolls nice and fat!

    ...and three years later, when it's time to run for reelection, most people still blame the banks for what Obama did--and think the solution to stopping bailouts from happening again isn't tying the hands of the president or Congress. A lot of people think the solution is heaping more regulation and oversight on the banks!

    Now growing businesses aren't the solution to economic stagnation and unemployment--they're the cause of the problem?!

    Yeah, it makes me angry too.

  • wareagle||

    the Obama Administration never loses sight of the prime directive of liberalism: it cannot survive without a massively uninformed and/or apathetic populace. POTUS repeatedly spouts things that are demonstrably false, but the media simply parrots what he says without question. On the rare occasion that something IS challenged, it happens three days later when the narrative has moved on to something else. Liberalism could not survive in the presence of thinking folks willing to do some independent research and fact-check the bullshit DC shovels at them.

  • ||

    I think the worm has turned in our favor, though.

    It used to be that libertarian ideas had no forum whatsoever. If your local newspaper or one of the three major networks wasn't libertarian, then there was very little in the way of libertarian voices that were ever being heard by anybody.

    The interwebs changed that. People get their news wherever the hell they want. You can't find a chatroom anywhere where people aren't talking about some libertarian idea or other.

    I heard Mark Shields on PBS the other day talking about libertarianism in relation to Ron Paul in New Hampshire--and he got most of it right!

    As media continues to fragment on the web, too, our voices continue to get stronger. Marijuana legalization, etc. is given serious consideration by an awful lot of people these--and that's new. And I don't think all those people came to that conclusion all by themselves.

    I suspect that what we say to each other online and elsewhere is more powerful than we realize. So, I think there's still hope. Karl Marx started with a lot less than what we've got, and we've got the advantage of being right!

  • wareagle||

    and as a bonus, I heard Michael Reagan last night - in response to a question about Paul - saying that Ron was in a good spot since a lot of the issues are coming to him. In other words, what he's been talking about is hitting the mainstream, as you also said.

    There is still the O'Reilly wing that equates Paul's success with college kids wanting legalized pot, but that's becoming perceived as establishment knee-jerk BS. Huge difference between what Paul actually says and what the commentariat claims he said, far more so than with any other candidate.

    Loved the 'dangerous' chant from the other night. That rumble some may have felt was Jefferson laughing from the grave.

  • ||

    Aren't we, as taxpayer's, the largest outstanding investors?

  • ||

    That's sort of the point as to why we shouldn't corrupt the system with taxpayer money.

    Yes, having received taxpayer money, the taxpayers have a right--regardless of whether it's enshrined in law--to weigh in on how that company runs its business. It's sort of like "no taxation without representation", which wasn't enshrined in law either. It's just a general law of the jungle--that if taxpayers are footing the bill, then they get to have someone that represents them making decisions about how that money is used.

    I'm just saying that it's important not to throw the baby out with the bathwater. ...otherwise, we really will end up gravitating towards democratic socialism. I'm not willing to let Congress or the president run the economy like we're democratic socialists--just because they squander our funds on their favorite companies. If that's all it took for Congress and Obama to take over all the large corporations in America?

    They'd give all those corporations taxpayer money tomorrow--and demand seats on the board or take regulatory control of every single one of them.

    If we don't want the government running most businesses and the economy through regulators, etc., then we need to oppose the government giving these companies taxpayer money--but just because the companies have taxpayer money now, that's no reason to transition to democratic socialism either and insist that our duly elected representatives run those companies!

    In the end, it isn't about making sure our politicians have control of major corporations that receive taxpayer money--it's about making sure that corporations don't receive taxpayer money and, hence, that politicians have as little control over private corporations as possible.

  • ||

    Occupy Wall Street: "Bailouts are yet another reason why democratically elected politicians need to run corporations."

    Ken Shultz: "Democratically elected politicians running corporations is yet another reason why we need to oppose bailouts."

  • ||

    Oh I totally agree that there should be a separation of business and state. I just meant that since we are the largest group of outstanding investors, all those other people have to suck it and get in line.

    And the idea that any of those employees deserves a bonus that is more than my yearly salary is so laughable it makes me want to shoot myself.

  • ||

    I just meant that since we are the largest group of outstanding investors, all those other people have to suck it and get in line.

    Was there a contract? There should have been. It depends on what's in the docs.

    http://en.wikipedia.org/wiki/Subordination_(finance)#Equitable_subordination

    I don't know where who in the line is. If we subordinated ourselves, we may not be first in line. And, regardless, whoever is running the company, be that a bankruptcy judge or a trustee, they have the legal duty to run that company in the best interest of shareholders.

    If they're out there still trying to sell the company as an ongoing concern, which would certainly fetch a higher price than its assets, then they have a duty to try to keep that company alive as a working concern. A viable business that could potentially emerge from bankruptcy is worth a lot more than a company's liquidated assets.

    No need to be penny smart and pound foolish. I don't know anything about this industry or the value of their patents, etc., or whether they can regroup and refinance and maybe contract for manufacturing overseas, but if paying six guys a $50,000 bonus to keep the company viable is worth more than $300,000 to the taxpayers when they sell the company?

    Then paying a bonus, that may be a bit higher than the industry standard to keep crucial employees from jumping ship, could be the smart thing to do to keep the company viable.

  • ||

    If, and that's a giant "if", the company were viable.

  • ||

    the correct plural of 'bonus' is 'boners'

  • o3||

    +8"

  • AlmightyJb||

    This type of thing does sometimes happen with companies in transition. Normally it would be in the form of a future bonus. Youll get a bonus in two years provided you dont quit before that time or something along those lines. They should be paying back taxpayers with that money though.

  • ||

    Yes - I've seen it too when a company is in trouble and everyone starts jumping ships.

    Mr Whipple's question is important. Are they actually trying to re-launch this disaster of a company? Liquidation seems more appropriate.

  • Spoonman.||

    Yeah, I thought the company was being liquidated. It's hard to imagine a justification for any other course - and didn't they sell their factory?

  • Mr Whipple||

    There's no reason to give any bonuses if the company is being liquidated, right? Unless, the lawyers are getting a cut.

    You don't need upper management to liquidate a company. That's what receivership is for. All you really need is a good forensic accountant, if that.

  • James J.B.||

    Couple of points.

    1. Why is it that we need to keep the "top talent" that caused this mess in the first place?

    2. Why don't they get told what the rest of us get told - should be happy they have a job IN THIS ECONOMY (tm)?

    3. What happens if we don't pay it - will they really F things up?

    4. So every employee quits - why should that money be used to pay the tax payers back or the Soly creditors?

    I could do more...

  • ||

    How dare you question these people. Truly they are doing the lord's work....At least that's what Tony told me.

  • wareagle||

    1) the fact that this is top talent means it is beyond reproach, especially when said top talent is promoting something the left embraces. That alone renders the rest of your points null and void.

    Your Solyndra-made tinfoil hat is on the way to discourage you from questioning "top talent" whose thought processes are clearly beyond those of the common folk.

  • ||

    If this "talent" is so "top", then they must have known they were joining a very high-risk venture (a bet, basically, on (a) government support, (b) high silicon prices, and (c) slow Chinese entry into the market).

    And they took that bet. Makes me think they would have been better off taking their talent to South Beach. And that they are less than essential to an orderly liquidation.

  • Tman||

    Yeah, I don't think this will look good on your resume in terms of future employment.

    Recruiter: "So, you worked at Solyndra and managed to be a part of a company that got over a half a billion of taxpayer money and then proceeded to mismanage the company so terribly that you couldn't even liquidate anything at auction? And then you whined to the Bankruptcy courts to give you a bonus so you would continue to stick around and further mismanage this company? Yeah, no thanks.."

  • RedDragon6009||

    Who are they kidding? Are people actually buying this crappy product? Does anyone expect that they'll be around after installation of their worthless panels to honor any warranties or handle customer service complaints?

    Hell, this company is so toxic that no one is even willing to buy pieces of it at auction.

    It doesn't a "Mitt Romney" or "Bain Capital" to realize that there is no way to save Solyndra. We're better off burning the fucker down to try to collect insurance on it.

  • ||

    Maybe, but I doubt they paid their premiums.

  • Typical Liberal||

    Of course a company that NEEDED government monies to get started, NEEDS government money to pay their Top Men to stay, and produces a product that most people NEED tax incentives in order to purchase (and will certainly use them even if a customer doesn't need them) is a failure of the free market.

    Capitalism is dead, and we REALLY need to concentrate on removing corporate influence from DC.

  • ||

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  • AssetGlobe||

    Not sure why they need this people. Everything will be auctioned in February...

  • sweeterjan||

    e time it takes before you gask http://www.maillotfr.com/maill.....-3_21.html for air, I guarantee Barry has apportioned $518 million of tax-payer money.
    Small potatoes.

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