(Corrects headline and paragraph one to show that the judge
approved only $10.8 million in incentive payouts and is yet rule
on the $4.1 million incentive payment to senior executives)
Aug 16 Residential Capital LLC, the bankrupt
mortgage lending unit of Ally Financial Inc, won court approval
on Wednesday to pay $10.8 million in incentive payments to hold
onto some key employees.
The company had sought to pay $10.8 million to 174
employees, which included people who work in the finance, legal,
origination, technology and other operations.
ResCap also sought to pay $4.1 million to 17 senior
executives, not including Chief Executive Officer Thomas Marano.
A judge is yet to rule on the incentive payment sought for
These recipients together comprise roughly 5 percent of
ResCap's 3,625-person workforce, a court filing showed.
ResCap said the payments would help maximize the value of
the company, encourage executives to take on restructuring and
sale-related duties, and help ensure that employees with
"irreplaceable knowledge" of the business do not leave.
Once part of General Motors Corp, Ally put ResCap into
Chapter 11 bankruptcy protection on May 14 as a means to address
the unit's mortgage-related liabilities. Ally is roughly 74
percent-owned by taxpayers, and did not file for court
The case is In re: Residential Capital LLC, U.S. Bankruptcy
Court, Southern District of New York, No. 12-12020.
(Reporting by Tanya Agrawal in Bangalore)