CEO golden parachute halved as Steimatzky sale stalls [Globes, Tel Aviv, Israel :: ]
(Globes (Tel Aviv) Via Acquire Media NewsEdge) June 19--Sources inform "Globes" that Steimatzky Group CEO Iris Barel will have to waive half of her $2 million golden parachute from the sale of the bookseller to a consortium led by Yafit Greenberg. At the same time, book publishers are meeting the company to discuss its debts to them, and how much they will lose.
According to one publisher, Barel agreed to forego half of the $2 million bonus in her contract with Steimatzky's owner, Markstone Capital Partners Group LLC, and that Markstone will guarantee the bonus, which will be paid over three years.
The publishers' consent is important to closing the sale, because they and their employees are Steimatzky creditors, and if it is sold without their agreement on debt payments, they can go to court to sue for repayment of the debt or its deposit in a compensation fund. If there is no agreement, the publishers and their employees can cause Steimatzky to go into a stay of proceedings.
In view of the publishers' power, it was reported on Wednesday that they were offered a 30% loss on the debt and the rescheduling of payments at much better terms than were offered two weeks ago. Then, the publishers were reportedly offered a 70% or even total loss if Steimatzky obtained a stay of proceedings.
Steimatzky's sale will only be possible with the consent of the publishers and the bookseller's employees about refilling their severance fund, which was emptied by the current management. The fund's current shortfall is NIS 18.5 million.
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