Indalex creditor's committee objects to management bonuses

The creditors' committee for Indalex Holdings Finance Corp. is objecting to a proposed bonus program for management.

The committee says that Lincolnshire-based Indalex, the second-largest producer of soft aluminum extrusions in the U.S., filed the motion for approval of the bonuses only three days before bids were due for the sale of the assets.

The committee says that Indalex knew by then that the sale price would exceed the threshold required for paying executive bonuses. The committee contends that the program is a retention bonus prohibited by Congress for senior managers of bankrupt companies.

The issue will be decided in bankruptcy court tomorrow. The Indalex Chapter 11 petition filed March 20 listed assets of $356 million against debt totaling $456 million.

It is one of 15 investments by private-equity investor Sun Capital Partners Inc. to file in Chapter 11 since January 2006.

Sun Capital purchased Indalex in 2005 for $425 million. Indalex has almost $306 million in secured debt, including $70 million on a revolving credit and $30 million on two term loans, in addition to $198 million in second-lien notes. Annual revenue exceeds $1 billion. The case is In re Indalex Holdings Finance Inc., 09- 10982, U.S. Bankruptcy Court, District of Delaware (Wilmington).