Embattled business aviation provider Wheels Up’s Securities and Exchange Commission (SEC) Form 8-K released on May 9 reveals that outgoing chairman and CEO Kenneth Dichter will continue to receive his $950,000 annual salary for the next two years. Dichter, who founded Wheels Up and will remain a director on its board, will also receive a lump sum payment of $3 million, “which represents an amount in lieu of a bonus payment that could otherwise be payable under the Employment Agreement, dated April 17, 2020,” according to Tuesday’s filing. Dichter will also “be eligible to receive a prorated annual bonus based on the number of days he was employed during fiscal year 2023.” A Form 8-K is defined by Wikipedia as “a very broad form used to notify investors in United States public companies of specified events that may be important to shareholders or the United States Securities and Exchange Commission.”
The outgoing executive will also continue to receive company health insurance coverage, as well as be eligible for 200 hours per year travel on Wheels Up aircraft, among other benefits.
Wheels Up is facing financial headwinds and recently announced plans for a possible reverse stock split, followed by the addition of new executives, leading up to the May 9 announcement of Dichter’s departure, included in the Form 8-K.
Aviation consultant and contributing writer Brian Foley wrote on Forbes.com that recovery options for current Wheels Up management could include securing more investment cash from its largest shareholder Delta Air Lines, a possible return to the private sector and further fundraising and/or combining with a “strategic” (long-term financial strategist). Foley wrote: “Reorganizing through bankruptcy is another possibility, and if a private equity or other acquirer ever became involved, would presumably be a prerequisite.” Though a Wheels Up spokesperson told the online news source Private Jet Card Comparisons, “We are not considering bankruptcy.” The news site also reported today that Wheels Up has just cut flight pricing up to 26 percent under new flight-services agreement.
Wow, pretty sweet job if you can get it.
Yep, he founded the company and is an entrepreneur, deserves every penny. That’s the deal when take the risk to start any company. Good for him. That’s not the reason they will go under, it will be for other reasons.
I fail to see the risk when failure means keeping your salary, bonuses, and benefits.
Whoever said you can’t get wealthy in aviation never met this guy.
Gee wiz, the airlines I worked for went bankrupt and I got nothing and the execs who trashed them got millions. It’s the American way.
A Private Jet Card Comparisons story posted in 2021 listed Wheels Up’s thirteen Chief (something) Officers and an additional Chairman of marketing. Seems very, very top-heavy.
All of this compensation on the backs of the stakeholders who put their trust in him. Dichter is a charming fellow. Tons of personality. Loved by most. He is probably the greatest salesman that ever lived. He “convinced” (salesmanship at its best) a lot of people to follow him by investing, but so did Bernie Madof.
The question you need to ask yourself is whether WUP ever intended to make money for their stakeholders, or just for the top 13 execs. I worked there for two years. I saw the absurdity of the waste and mismanagement.
You also need to ask yourself If Dichter jumped ship while there was still a few bucks in the till so he could get “his” before anyone else got “theirs”. Kenny got out while he could still bilk the stakeholders for more money. Shameful. Think about it as if he were the Captain of the Titanic. Responsible for running into the berg and then scampers for the first life-boat ahead of the women and children. There is no honor in this, only shame.
WUP(Gama) still owes me vacation pay which I earned in 2019 that I should have been paid in 2020 and Dichter leaves the ship with more than $5M.
That thing may be legal but is, undoubtedly, unethical. Period!
Wheels Up spokesperson; “We are not considering bankruptcy.” English translation: If we can’t extort more cash from Delta, we’re declaring Chapter 11. In corporate America, the first thing a CEO does when starting or joining a new company is to set up his/her severance package (aka Golden Parachute). In that regard, Dechter is small potatoes. A company I used to work for was in financial trouble, so they hired a new hot-shot CEO to “turn the company around”. In a meeting, I specifically asked him if the financial steps he was taking was setting the company up to be sold. His answer was “Absolutely not. We are here for the long run.” Less than a month later he announced we had been acquired and he was stepping down. His reward was a $35 million dollar severance package. Over half our original employees’ reward was two week’s severance. If you are looking for fair or ethical, don’t look for it in the corporate boardroom.
When the corporate spokes person says the “b” word in a press release its over….I feel for the hard working employees that don’t get a bag of cash on the way out like the slick haired CEO.
He makes almost as much as the president of AOPA.