New York Times Adjusts Executive Compensation After Errors

By Nat Worden

Of DOW JONES NEWSWIRES

NEW YORK -(Dow Jones)- Recent cash and stock compensation plans approved by New York Times Co. (NYT) for Arthur Sulzberger Jr. and Janet Robinson, the newspaper publisher's two top executives,
exceeded limits set by its corporate governance policies, forcing the
company to rescind past awards and adjust plans for the coming years.

The admission of error, made late Friday in a regulatory filing with
the Securities and Exchange Commission, comes at an especially
sensitive time of financial distress for the publisher, as it seeks to
sell its Boston Globe newspaper after hard-nosed negotiations with its
union. It has come under fire from investors for mismanagement as well
as governance shortcomings in recent years as the newspaper business has slumped amid the rise of digital media.

The company had approved bonuses for both executives that could have
brought their total cash compensation in 2011 and 2012 up to $500,000
more than a $3 million limit set by the company's governance policies.
It has adjusted the potential rewards to fit within the limit.

The bonuses, whose actual amounts will be determined by the company's
performance, are aimed at incentivizing its leaders and supplementing
their salaries. Since their annual salaries were frozen in 2006 due to
revenue declines that have led to a plunge in the company's stock price, Sulzberger's has amounted to $1.09 million while Robinson's has been $1 million salary.

The company lost $35.4 million in the first half of the year as its
revenue dropped 29%. Its stock closed down 6 cents to $8.36 on Friday,
down nearly 80% over the last five years.

Also, the Times Co. had adopted a plan in 1991 dictating that its executives shouldn't get more than 400,000 stock options
each year. However, its 2009 compensation granted Sulzberger and
Robinson 100,000 options in excess of that limit, and last year,
Robinson was given 250,000 more than was allowed.

To correct
that, the company voided a total of 450,000 options and issued new
awards to the executives called "stock appreciation rights" that will
vest on the same schedule and have the same exercise prices as the
voided options.

The filings included no explanation of how the mistakes were made or
how they came to light. A spokeswoman for the company couldn't be
immediately reached on Friday.

The company's flawed compensation plans were made in 2008 and 2009 by a board committee chaired by venture capitalist David Liddle.

-By Nat Worden, Dow Jones Newswires; 212-416-2472; nat.worden@dowjones.com

http://www.smartmoney.com/news/ON/?story=ON-20090918-000609-2151