Absent emergency intervention from a federal appeals court, former managers of the Salt Lake Tribune must ante up $355.5 million this week in order to regain control of the newspaper.

U.S. District Judge Ted Stewart on Monday refused to delay a Friday closing on the option agreement that allows Salt Lake Tribune Publishing Co. (SLTPC) to buy back the newspaper it sold to Telecommunications Inc. in 1997.

The cable company later merged with AT&T, which sold the Tribune to MediaNews Group Inc. in January 2001 for $200 million.

Under the original agreement, the 120-day closing period would have ended in November 2002. However, ongoing litigation over ownership of the Tribune has resulted in nearly a year of delays.

SLTPC attorney Gary Bendinger argued Monday that allowing the Oct. 10 closing to go forward would cause irreparable harm to his clients. After his motion was denied, Bendinger said he would file an appeal with the 10th U.S. Circuit Court of Appeals as quickly as possible.

SLTPC maintains the final exercise price of the paper is unresolved, as is the question of what assets will be conveyed. Forcing a closing at this point, Bendinger said, will require SLTPC to choose between paying at least $100 million too much for the paper or forever losing its chance to regain ownership of the Tribune.

"We should not be put to that choice," he said.

Stewart, however, disputed that the Tribune's exercise price is in question. Last week, he upheld the appraisal process that set the fair market value of the newspaper at $355.5 million. Even though SLTPC intends to appeal that decision, Stewart said, that doesn't mean the issue isn't closed for the time being.

"You do not deem the court's orders to be in any respect final, obviously," Stewart said, noting that SLTPC could make the same argument if it loses before the 10th Circuit and takes the issue to the U.S. Supreme Court. "There has to be a logical and practical end for that issue."

Stewart also questioned Bendinger's arguments that the situation has left SLTPC unable to secure the necessary funding to purchase the Tribune. The management group, made up primarily of members of the McCarthey family, will need to finance between $90 million and $140 million to meet the exercise price, Bendinger said.

Principals in the management company have met with three lenders, he said, but have been hampered by a lack of details regarding which assets MediaNews would transfer to SLTPC.

The judge said SLTPC has known all along it would one day be faced with a closing.

"Why have they not put themselves in a position to abide with the contract they signed?" Stewart asked.

MediaNews attorney Kevin Baine disputed Bendinger's allegations that his clients have been evasive about their intentions at closing, citing repeated correspondence over the past year between MediaNews' transaction attorneys and SLTPC's attorneys. SLTPC attorneys have repeatedly failed to respond to MediaNews' letters and documents, he said.

Trial in the ownership dispute is scheduled to begin Nov. 3.

Sale of the Salt Lake Tribune - Read Deseret News' archive stories and see related links about the sale of the Tribune.

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E-MAIL: awelling@desnews.com