Story ID: 
Fresh Turbulence at Wheels Up 
By: Mark Huber
Caption: Ex-CEO Kenny Dichter's generous exit package raises eyebrows.
Word Count: 313
Things went from bad to worse at Wheels Up, even as interim CEO Todd Smith was assuring investors and the media that the company was positioned for a rebound. After the stock shed an additional 21 percent on the day and markets closed, financial network CNBC reported that the company is consulting with bankruptcy advisers and that Warren Buffett, whose Berkshire Hathaway conglomerate owns NetJets, said he thought “there’s a good chance” that Wheels Up customers who prepaid for block hours “are going to be disappointed later on.”
Even as Wheels Up announced a first-quarter loss of $101 million, Wall Street eyebrows were further raised by the exit package crafted for outgoing CEO and founder Kenny Dichter. According to a Form 8-K filed with the U.S. Securities and Exchange Commission (SEC) by the company on Tuesday, Dichter will receive his $80,000 monthly base salary for the next two years plus an immediate lump-sum payment of $3 million. He will also receive any additional bonus for 2023 on a pro-rata basis and 100 jet flight hours in Wheels Up aircraft and will remain in the company’s health plan. Stock options held by Dichter that would have otherwise become vested over the next 18 months will become vested and exercisable immediately. 
On Monday, several law firms announced the launch of a class-action securities fraud suit on behalf of shareholders against Wheels Up based on its restatement of 2022 financial results earlier this year due to material weaknesses in its internal control over financial reporting. According to the firms, the “defendants’ positive statements about the company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times,” generating shareholder losses. Wheels Up lost $555 million in 2022. Since its stock went public in July 2021, shares have lost more than 95 percent of their value.