Creditors Unclear on Tribune Plans

Trade creditors say "incomprehensible" Chapter 11 proposals from financial backers of Tribune Company have left them wondering about their prospects of getting paid when the media company exits bankruptcy protection.

In a filing with the U.S. Bankruptcy Court in Wilmington, an informal group of trade creditors said it isn't happy with any of the four competing Chapter 11 plans for Tribune but would at least like a plain statement of how much they will get, and when, under each of the plans. The "when" could be the deciding point for Tribune suppliers, who have waited nearly two years to be paid. Tribune's quartet of Chapter 11 proposals all call for lawsuits to be filed after the company officially exits bankruptcy-court protection. In an effort to raise cash for creditors, the suits focus on the 2007 leveraged buyout that piled more than $8 billion in debt on Tribune. Depending on which of four plans is approved, the lawsuits could target company executives, lenders and advisers on the deal, and even major shareholders who cashed out.

Tribune's trade suppliers want their money up front before the lawsuit machinery gets into gear. They can't tell if anyone is promising to give it to them, according to papers filed Thursday by the informal trade creditors' panel. The protest from the trade creditors comes in advance of a Nov. 29 court session in which a judge will review the explanations that the four Tribune Chapter 11 plan proponents want to send out to creditors.