(Reuters) — Tribune Co. is seeking approval from a bankruptcy court to allow it to continue its management incentive plan, which seeks to pay around 640 management employees up to $42.5 million.
Under the plan, the company will pay $16.4 million if it achieves "threshold" performance of its planned consolidated operating cash flow, $32.4 million for "target" performance and $42.5 million for "maximum" performance.
Tribune, owner of the Chicago Tribune and Los Angeles Times, said the incentive plan has been a key component of its compensation structure since 1997. The payout on the current plan is lower than the court approved 2009 and 2010 plans, it said.
In a court filing in the U.S. Bankruptcy court in Wilmington, Del., the company said the approval of the plan "continues to be critically important to maintain proper incentives for the management team as the company strives to sustain its performance despite the strains of the Chapter 11 process."
Tribune Co. filed for bankruptcy protection in 2008, a year after billionaire real estate developer Sam Zell led a leveraged buyout. The deal loaded the company with about $8 billion in additional debt in a transaction financed in part by company contributions to an employee stock option plan.
The case is In Re Tribune Co., U.S. Bankruptcy Court, District of Delaware, No. 08-13141
Read more: http://www.chicagobusiness.com/article/20110831/NEWS06/110839976/tribune-seeks-ok-to-continue-management-incentive-plan#ixzz1WeuWihDu
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