Tribune deal calls for departure of Chandler family


NEW YORK -- Three directors representing the Chandler family will depart Tribune Co.'s board as part of a deal announced this week to take the company private, according to a regulatory filing made Thursday.

In addition, the company has set aside a cash bonus pool of $6.5 million for top executives once the deal is complete. Chairman and Chief Executive Officer Dennis FitzSimons chose not to participate in the bonus pool. The company said the bonus pool would take the place of restricted stock units which had been authorized.

The disclosures were made in a filing with the Securities and Exchange Commission late Thursday that provided details of Tribune's $8.2 billion deal announced Monday.

That deal will take the Chicago-based media company private and convert it to an employee-owned structure called an employee stock ownership plan, which functions something like a profit-sharing system.

Chicago real estate mogul Sam Zell is contributing $315 in financing to the deal and will become the company's chairman. He will also gain the right to purchase 40% of the company's stock later.

In the filing, Tribune said that 38 top executives involved in consummating the deal -- except FitzSimons -- would share the bonus pool once it is complete. Donald Grenesko, the company's finance chief, would receive $600,000; Scott Smith, head of the newspaper division, $400,000; and broadcasting division chief John Reardon would get $350,000.

As part of the deal, the three board members representing the Chandler family -- the company's largest shareholder -- would depart the board. Tribune purchased Times Mirror Co. from the Chandler family in 2000 for about $6.5 billion.

The Chandler family called for a shake-up in the company last year, setting in motion the process that resulted in the privatization by Zell that was announced Monday.