Court OKs Tribune Co.'s $42.5 million 2011 management incentive plan

By Jim Witters

Wilmington, Del., Oct. 4 - The Tribune Co. received court approval on Tuesday for a 2011 management incentive plan that could pay as much as $42.5 million to 640 employees.

Judge Kevin J. Carey approved the plan during a hearing in U.S. Bankruptcy Court for the District of Delaware.

Under the plan, the disbursement would be the following:

• $16.4 million, representing a 50% of target payout, if the company achieves consolidated operating cash flow equal to 91% of its $487 million goal established in February 2011;

• $32.4 million, representing a 100% of target payout, if the company achieves target performance equal to 106% of the goal; and

• $42.5 million, representing a 130% of target payout, if the company achieves maximum performance equal to 141% of the goal.

The debtors stated in court on Tuesday that projections place end of year operating cash flow at $517 million, still short of the $525 million needed for 100% incentive plan payout.

If operating cash flow hits the $497 million target, incentive plan payout would be 81%, the debtors said.

Tribune, a Chicago-based media company, filed for bankruptcy on Dec. 8, 2008. Its Chapter 11 case number is 08-13141.

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