Local Rule 2016-2: Compensation of Debtor, Officers, Directors, Shareholders, Partners

Rule 2016-2 Compensation of Debtor, Officers, Directors, Shareholders, Partners

(a) General. Unless otherwise ordered by the court, except in accordance with the provisions of this rule, if the trustee or debtor-in-possession is operating a business, no compensation may be paid by the debtor or by any entity owned or controlled by the debtor, to any of the following from the date of the order of relief until the confirmation of the plan: (1) the debtor, if the debtor is an individual; (2) a partner, if the debtor is a partnership; (3) an officer, stockholder, or director, if the debtor is a corporation; (4) a manager or member, if the debtor is a limited liability company; or (5) an individual who is— [A] an insider of an individual debtor, [B] an insider of a partner of a partnership debtor, or [C] an insider of an officer, stockholder, or director of a corporate debtor.

(b) Notice of Intent to Pay Compensation. The trustee or debtor-in-possession must give notice conforming to AK LBF 26 to:

(1) United States trustee; (2) any committee appointed under the Code, or if no committee appointed, the five largest unsecured creditors; (3) all secured creditors with claims in excess of $50,000.00; and (4) parties requesting notice.

(c) Commencement of Compensation.

(1) Compensation may commence no sooner than seven (7) days after notice is given.

(2) If an objection is filed, the trustee or debtor-in-possession may continue compensation at the average monthly salary for the year preceding bankruptcy pending a hearing.

(3) The court will ordinarily schedule a hearing within fourteen (14) days of a request.

(4) Objections to compensation may be filed at any time.

(d) Limitation on Compensation. The trustee or debtor-in-possession may not pay compensation in excess of that contained in the notice, unless an amended notice is filed and served in accordance with this rule.