Developments in the Tribune Co. Chapter 11 Process

From: Tribune Communications
Sent: Tuesday, November 01, 2011 9:10 AM
Subject: Message from Don Liebentritt/Developments in our Chapter 11 process

We now have the judge’s opinion on the competing plans for reorganization that were filed in our bankruptcy a year ago. While there was no winner, at least officially, there is a silver lining in what the judge had to say about our plan and the process going forward.

Though both plans were rejected, and our time in bankruptcy thus extended, the judge made a series of rulings very favorable to the major elements of the company’s plan. Most important, the judge indicated a decided preference for our plan provided we made a number of changes.

To address the problems the judge had with our plan, we will need the cooperation and agreement of our plan co-proponents, the Official Committee of Unsecured Creditors and the Senior Lenders (JP Morgan Chase, Angelo Gordon and Oak Tree). Our goal is to have a revised plan before the court prior to the hearing scheduled for November 22, when the judge will be looking for evidence that we’ve listened to and acted on the guidance offered in his opinion. If we’re successful, as I hope we are, we will be pushing an amended plan through what should be an accelerated confirmation process that could be concluded early next year.

Aurelius Capital and the other pre-LBO creditors did not fare as well; we’re not sure how they will respond to yesterday’s opinion and how that might affect our plan.

Finally, it has been reported that the company will have to “throw some employees under the bus” in order to correct one of the problems found with our plan. Our plan did seek to protect some employees whose Tribune stock was sold or cashed out in the LBO, in their 401k plans or for up to $100,000 for current employees. The judge found our effort laudatory, but not legally supportable. We haven’t given up yet, but the bar to overcome is quite high.

All said, we see yesterday as a delay, not a defeat. We see a path to getting out of bankruptcy, and we don’t have to start from square one. We on the restructuring team will work hard to reach that goal as quickly as possible, as hard as each of you do in what you do for the company, and that’s a whole lot.

Don Liebentritt
Chief Restructuring Officer