King owners Jeffrey Sudikoff and Joseph Cohen will not be involved with the team after they sell it to Denver billionaire Philip F. Anschutz and developer Edward P. Roski Jr., a transaction expected to close in October.
Cohen, who has been the team's chairman, will join Madison Square Garden, it was announced Friday. A King spokesman said Cohen was en route to New York and unavailable for comment.
Having started his business career at the Garden in 1970, Cohen will return as an executive vice president in charge of the MSG Network, sponsorship sales and new business development.
Bankruptcy court documents state Cohen will receive one year of severance payments worth $550,000. In addition, Majestic/Anschutz Venture (MAV) will assume and pay Cohen's outstanding vacation pay of $24,000 and a bonus of $125,000.
Sudikoff, the founder of IDB Communications, remains under a cloud of legal problems.
Securities and Exchange Commission filings acknowledge an ongoing criminal investigation into the communications company's accounting methods. The U.S. Attorney's office in Los Angeles recently assigned another prosecutor to the case, and Sudikoff has retained noted defense attorney Brad D. Brian, who successfully represented former Columbia Savings & Loan chief Thomas Spiegel in a federal case last year.
Meanwhile, in a hearing Friday in U.S. Bankruptcy Court, Judge Lisa Hill Fenning approved the use of incoming income and current funds to continue the team's operations and granted a request to honor ticket refunds still remaining.
A deadline of noon on Oct. 2 was set for the deliverance of any overbid offer for the franchise, which is considered remote.