Tribune lawyers negotiate confirmation language; July ruling planned

By Jim Witters

Wilmington, Del., June 11 - Tribune Co. attorneys are negotiating furiously to resolve disputes and concerns with language in its fourth amended joint plan of reorganization to smooth the path toward confirmation.

The issues deal with preservation of rights of various parties in connection with avoidance actions and the structure of the litigation trust.

Two of three issues that were unresolved at the conclusion of a two-day plan confirmation hearing on Friday are now resolved, debtors attorney James F. Bendernagel said during a teleconference on June 11 with the U.S. Bankruptcy Court for the District of Delaware.

Remaining unresolved is a Robert R. McCormick Tribune Foundation request for language broadly affirming rights the debtors and other plan proponents say are preserved in other areas of the plan.

Judge Kevin J. Carey requested packets of documents from the plan proponents and from McCormick to allow him to decide on the proposed language changes.

Confirmation ruling

Up for confirmation is the plan proposed by the debtors, the official committee of unsecured creditors and lenders Oaktree Capital Management, LP, Angelo, Gordon & Co., LP, and JP Morgan Chase Bank, NA.

The proposed plan is commonly referred to by the parties as the DCL plan. It represents a revision of the plan rejected by Carey in October.

Throughout the three and a half years of the bankruptcy case, the DCL proponents have remained at odds with the senior noteholders and indenture trustees, who proposed their own plan of reorganization, which Carey also rejected.

The parties spent part of June 7 and all of June 8 presenting testimony and arguments to the court, and Bendernagel said he believes all the substantive issues have been resolved.

Bendernagel said that his goal is to have all the remaining documents to Carey - including the language changes, plan amendments, a chart of objections to the plan and the status of negotiations to resolve them and findings of facts and conclusions of law - by June 13.

Carey said he expects to render a written opinion on the plan confirmation motion in July.

Tribune representatives said that they believe the company could exit bankruptcy by the end of the year.

The company also is awaiting a ruling on its application with the Federal Communications Commission to transfer its broadcast licenses to a new ownership group that includes senior creditors Oaktree Capital Management, Angelo, Gordon & Co. and JPMorgan Chase.

Tribune Co. attorneys have said that $7 billion of recoveries for creditors awaits the plan confirmation and effective date.

Tribune, a Chicago-based media company, filed for bankruptcy on Dec. 8, 2008. Its Chapter 11 case number is 08-13141.

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