September 1, 2011
By: Mike Stetzer
Tribune Co. asked the judge in its bankruptcy case Wednesday for permission to pay 2011 management bonuses totaling a possible $42.5 million.
The bonuses would be paid out to 640 management employees and are dependent upon the media conglomerate’s operating cash flow performance this year.
The plan, approved by the court in February, calls for Tribune Co. to pay $16.4 million in bonuses if it reaches "threshold" performance, $32.4 million for "target" performance or $42.5 million for "maximum" performance. The payment amounts are slightly lower than those requested in the company’s 2010 plan.
The company reported in January that it generated $635 million in cash flow last year. In February, it revised its 2011 cash flow forecast to $497 million in order to reflect expected declines in political advertising and newspaper performance. The conglomerate’s leading papers include the Chicago Tribune and Los Angeles Times.
The $635 million cash flow in 2010 matched Tribune Co.’s maximum goal, allowing $42.9 million in management payouts.
The Chicago Tribune reported that Tribune Co. is allegedly meeting this year’s expectations, due in large part to its broadcasting division, which includes more than two dozen television stations.
The company’s senior creditors have shown support for the bonus request, but have requested tighter performance requirements and stipulations for two Tribune Co. executives.
Chandler Bigelow, chief financial officer, and Dan Kazan, senior vice president for investments are defendants in potential litigation regarding Tribune Co.’s 2007 buyout. The two executives were barred from receiving 2010 bonuses and their bonuses this year would be placed in an escrow account pending the outcome of their case.
Tribune Co. filed bankruptcy a year after the 2007 buyout by billionaire Sam Zell, loading the company with $8 billion in additional debt. The company has argued for the management bonus program every year following the bankruptcy filing.
U.S. Bankruptcy Judge Kevin Carey has passed each of the annual bonuses despite opposition from unions and creditors, which claim the payouts are too high in relation to the company’s diminished cash flow and continued layoffs.
Tribune Co. is currently awaiting Judge Carey’s decision regarding one of the two restructuring plans the company has proposed in order to emerge from bankruptcy.
PAID ATTORNEY ADVERTISEMENT: THIS WEB SITE IS A GROUP ADVERTISEMENT AND THE PARTICIPATING ATTORNEYS ARE INCLUDED BECAUSE THEY PAY AN ADVERTISING FEE. It is not a lawyer referral service or prepaid legal services plan. Total Bankruptcy is not a law firm. Your request for contact will be forwarded to the local lawyer who has paid to advertise in the ZIP code you provide. Total Bankruptcy does not endorse or recommend any lawyer or law firm who participates in the network nor does it analyze a person's legal situation when determining which participating lawyers receive a person's inquiry. It does not make any representation and has not made any judgment as to the qualifications, expertise or credentials of any participating lawyer. No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers. The information contained herein is not legal advice. Any information you submit to Total Bankruptcy does not create an attorney-client relationship and may not be protected by attorney-client privilege. Do not use the form to submit confidential, time-sensitive, or privileged information. All photos are of models and do not depict clients. All case evaluations are performed by participating attorneys. An attorney responsible for the content of this Site is Kevin W. Chern, Esq., licensed in Illinois with offices at 25 East Washington, Suite 400, Chicago, Illinois 60602. To see the attorney in your area who is responsible for this advertisement, please click here, or call 866-200-8052.
FLORIDA ONLY: Total Bankruptcy is considered a lawyer referral service in the state of Florida under the Florida Rules of Professional Conduct. By all other standards, Total Bankruptcy is a group advertisement and not a lawyer referral service.
If you live in Mississippi, Missouri, New York or Wyoming, please click here for additional information.
By an Act of Congress and the President of the United States, we are a federal Debt Relief Agency. Attorneys and/or law firms promoted through this Web site are also federally designated Debt Relief Agencies. They help people file for relief under the U.S. Bankruptcy Code. Disclosures Required Under the U.S. Bankruptcy Code.