Alex Holmes

I am the Chief Restructuring Officer hired to oversee Spirit Airlines' Chapter 7 liquidation. The first meeting lasted forty minutes. We approved $10.7 million in retention bonuses for senior management in the first thirty-two minutes. We eliminated 17,000 positions in the last eight. I had a Cobb salad. It was catered. The conference room on the 34th floor of Weil Gotshal's midtown office has a view of the Hudson and a credenza that costs more than a flight attendant's annual salary, which I know because I've liquidated the furnishings of six conference rooms in my career and I remember the comps. I want to be precise about the math because I've been deposed before and I'll be deposed again: $10.7 million divided among 34 executives: $314,706 each. $0 divided among 17,000 workers: $0 each. The ratio is undefined. You cannot divide by zero. Mathematically, the gap between what management received and what labor received is infinite. I thought about this in the room. While eating the salad. I found it — and I want to be careful here, because I'm under oath — I found it elegant. The way you find a proof elegant. The math has a certain cleanliness to it. The bonuses were classified as "Key Employee Incentive Payments." Key means: can sign documents. Key means: has a relationship with creditors. Key means: knows which judge to file with in the Southern District of New York. A flight attendant with nine years of service does not know which judge to file with. That is why she is not key. If she knew which judge, she would be key. But if she knew which judge, she wouldn't be a flight attendant. The category is self-selecting. That's what makes it elegant. Three of the executives who received retention bonuses had been with Spirit for less than eighteen months. They were hired during the bankruptcy. Their job was to help me wind down the company. Their bonus was for successfully eliminating their own positions. We paid them $300,000 each to fire themselves gracefully. I approved this because it is standard and because — I'll say this — the alternative is that they leave, and if they leave, I need to hire new people to fire the old people, and those new people will also need retention bonuses. The logic is circular. That's not a flaw. A circle has no loose ends. A flight attendant named — I have her letter somewhere, one moment — Daniela Reyes. Nine years. She sent a handwritten note to the court. She asked whether the $314,706 average executive bonus could instead be divided among the 2,100 cabin crew. That's $150 each. For, and I'm quoting, "transitional expenses — bus fare, interview clothes, one month of COBRA." My associate spent forty minutes reviewing her letter to confirm it contained no procedural objections requiring response. She billed that time at $1,800 an hour. Twelve hundred dollars for forty minutes. Three times what Ms. Reyes was asking for. I authorized the charge. The court noted her letter. The bonuses were approved without modification. I should mention: my engagement letter guarantees my fees are administrative priority under Section 503(b)(1)(A). I get paid before anyone. Before the executives, before secured lenders, before bondholders, before unpaid vacation time, before pension shortfalls, before Ms. Reyes' bus fare. The person who orchestrates the distribution is the first person distributed to. The 17,000 received WARN Act notices by email to their Spirit-issued accounts. The accounts were deactivated eleven days later. We checked the read receipts. 2,340 employees never opened the email informing them they no longer had a job. They learned from other sources. We logged this. We did not send a follow-up because follow-up notifications were not included in the scope of services and would have required a change order, which would have required approval from the estate, which I administer. I have done this fourteen times. Nine airlines, three retailers, two hospital systems. One of the hospital systems served a community that had previously lost employer-sponsored health coverage when I liquidated a manufacturing plant in the same zip code in 2019. I didn't know this at the time. I learned it later, at a conference. Someone presented it as a case study in cascading regional effects. I thought: that's interesting. I should note that for future pitches. Same room each time. Same catering order. Same eight minutes at the end. The salad was $42. Nobody has ever asked what the salad cost.