Scripps Trust Asks Court For Stock Ruling p. 13

By: Mark Fitzgerald TRUSTEES OF THE Edward W. Scripps Trust are asking an Ohio probate court to approve their interpretation of trust agreement language that requires the trust to "insure" its control of the E.W. Scripps Co.
In a pleading filed March 11 in Butler County, Ohio, the trustees are asking Probate Judge Randy T. Rogers for a declaratory ruling that the trust agreement language only requires them to hold a majority of the outstanding Common Voting shares of the company ? which are not publicly traded ? and not a majority of outstanding publicly traded Class A Common Stock or the majority of the company's total outstanding shares.
The pleading in no way affects control of the company by the Scripps family, said the trust's chairman, Charles E. Scripps, a grandson of company
"The simple question of trust interpretation that we have put before the court is not who controls the company, but simply how the trust is to maintain its control as we work to fulfill the long-term goals of the trust and the company," Charles E. Scripps said.
Right now, the trust holds 82% of Common Voting Stock and 53% of the Class A Common Stock, which is traded on the New York Stock Exchange under the symbol "SSP."
Class A shareholders are entitled to elect the greater of three, or one-third, of the company's directors but are not entitled to vote on any other matters except as required by Ohio law. Holders of the Common Voting Stock are entitled to elect all remaining directors and to vote on all other matters.
Since E.W. Scripps Co. went public in 1988, the trust has gradually reduced its holdings of outstanding Class A Common Stock from approximately 77% to the current 53%.
If the probate court upholds the trustees' interpretation of the trust language, "the trust could further diversify its assets," the company said in a statement.
Scripps also noted court approval would also make it easier for the company to use Class A stock as currency in acquisitions or mergers, even though issuance of new shares could dilute the trust's ownership of Class A shares below a 50% stake.
This is the third time in its 75-year history trustees have asked Ohio probate court to affirm their understanding of the agreement.
"In a trust of this size it is not at all unusual for it to ask the court to bless the trustees' view or interpretation," said Bruce W. Sanford, the Baker & Hostetler attorney who is the trust's counsel. "Frankly, it's a question which the trustees don't think is capable of serious controversy."
The trustees' interpretation is endorsed by Scripps management.
"The freedom to use our stock gives us much more latitude when looking at opportunities," Scripps president and chief executive officer William R. Burleigh said.
Family control of Scripps will survive the termination of the trust. Under its terms, the Edward W. Scripps Trust will terminate upon the death of the last survivor of four persons specified in the agreement.
The youngest of those persons is now 73 years old. However, when the trust terminates, more than 80% of the Common Voting Stock of the company will be subject to the terms of a Scripps Family Agreement entered into by those who will inherit the assets of the trust, other cousins and the company.
This family agreement will restrict transfer and govern voting of Common Voting shares of the company held by family members.


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