As to the size of the loss the usual corporate wisdom is that any loss is bad so if you have one you may as well make it a big one to get rid of all kinds of nasties lurking in the accounts and get the matte over and done with. Get your banks onside first and there is no great problem
A huge severance pay for a CEO who put them in a loss making position for the first time in twenty years and trashed their good name is little short of criminal and shows utter contempt for small shareholders staff and some customers