First Magnus Financial Corporation expects to pay the employees that were terminated prior to filing bankruptcy when all is said and done.

This according to the liquidation plan and disclosure document filed last week with the bankruptcy court.

First Magnus will pay roughly $11.5 million in payroll and $903,000 in medical expenses.

However, it could be some time before the plan is approved and the payments are made.

Judge James Marlar set the confirmation hearing of the plan for Jan. 9, 2008 due to the time it will take for all creditors to submit objections and vote for the approval of the documents.

As Michael Warner, representing the unsecured creditors put it, "[the disclosure statement] is not in a state we could support today."

Under the liquidation plan and disclosure statement, the unsecured creditors will not likely get 100 percent of the money owed to them.

While the employees have priority over other unsecured creditors, they will only be paid up to $10,000 each. First Magnus figures there is roughly $12.3 million owed in wages but they deem $11.5 million in payroll priority, because of the limit.

"Most will fall into that category and be paid in full," said First Magnus attorney John Clemency.

Clemency is proposing a bar date of Dec. 3 for anyone wishing to file proof of a claim with the court against First Magnus.

The nearly 5,500 employees will not have to file a claim with the court, because they should have already been listed in the Schedule of Assets and Liabilities filed with the court Sept. 14. They would only need to file a claim if there was a dispute on the amount First Magnus set for a particular employee.

After confirmation of the plan is complete payments can be sent out and the case will be able to close.

"That’s a little over four months from filing to confermation," Marlar said. "That’s pretty good."