Friday, April 13, 2007

New Tribune Co. ESOP participation will not be automatic for certain employees

Union employees are covered by a collective bargaining agreement (CBA) which requires the Employer to negotiate with the Union over changes to retirement benefits because it is a mandatory subject of bargaining (descriptions on Page 2). Any new retirement plan and/or participation in the ESOP are subject to a collective bargaining process between the new Tribune and it's union employees.

Alternatively, non-union employees – under certain criteria – will automatically be participants of the ESOP and subject to the terms and conditions of the ESOP as described in Exhibit 10.14 of the SEC filing (see previous post). There will be no rollover of existing benefits to the ESOP. The ESOP will be the vehicle for all future retirement benefits as described in Exhibit 10.14. In other words, Tribune won't be making any more contributions to your 401(k) but you can continue doing so if you choose. The new Tribune will establish a cash-balance pension plan that accrues interest, funded with an amount equal to 3% of your base pay (excluding OT, bonuses, etc.) and you'll get shares equal to 5% of your salary put into your ESOP account.

No comments: