If Los Angeles Times owner Tribune Co. doesn’t make its looming debt payment or breaks any loan covenants, media analysts say bankers could force the company to sell off assets, including television stations such as KTLA (Channel 5).

By next spring, Tribune will need to come up with at least $600 million in cash or be forced to renegotiate the terms of its $12.5 billion debt.

And that could be nearly impossible given the deepening global credit crisis, as well as a long slide in circulation and ad spending at the Times and other Tribune papers.

“They don’t even have to necessarily miss a payment for the creditors to step in and renegotiate the loan agreements. All they have to do is break one of several cash flow covenants to trigger renegotiations,” said Ken Doctor, media analyst at Outsell Inc., a Burlingame media consultancy.

Real Estate tycoon Sam Zell, who made a fortune in the real estate business, purchased Tribune in a leveraged buyout for $8.5 billion in April 2007. However, the deal left the company with $12.5 billion in debt.

Since Zell took the helm at Tribune, he has forced massive companywide layoffs topping 2,000 jobs, more than 250 of them at the Times. Zell also has fired four Times publishers since he took over, recently tapping former DirecTV chief executive Eddy Hartenstein to take the post of Publisher.

Hartenstein was reportedly given six months free reign by Zell to operate, but just last week two months into his reign there were reports that 50 to 75 newsroom employees were being offered buyouts. That generated widespread speculation the company is teetering on the financial edge.

According to several analysts, Zell had a very thin financial margin to start and now he’s facing a virtual credit freeze amid an advertising downturn that isn’t expected to turn around for at least six to nine months, if not longer.

Even if the worst happened and Zell was unable to maintain the minimum cash flows, the banks will likely work with him but could extract a heavy toll by forcing him to sell prized assets, such as L.A’s KTLA. Another possible asset that might have to go: Tribune Co.’s 31 percent stake in E.W. Scripps Food Network, a leading cable network.

“It wouldn’t be the end of the world for a large and diverse company like Tribune, but it could mean that the bankers could toss in some directives to management if they choose,” said Rick Edmonds, media analyst at the Poynter Institute.

Calming words?

Tribune officials would not comment for this story. However, Zell did talk to CNBC anchor Maria Bartiromo last week about whether he was close to breaking any loan convenants, though he failed to calm fears.

“Tell me how difficult the economic conditions are going to be, tell me how much longer we’re going to see the kind of advertising erosion we’ve seen and then I think I could give you a better analysis of the newspaper business,” Zell said.

“If our cash flows and capital resources are insufficient to fund our debt service obligations, we will likely face increased pressure to reduce or delay capital expenditures, dispose of assets or operations, further reduce the size of our work force, seek additional capital or restructure or refinance our indebtedness.”

Zell reiterated his plans to sells the Chicago Cubs baseball team this year, something that he has already said is part of his plan to make the company profitable. Analysts believe the sale of the Cubs, Wrigley Field and its related broadcast properties could top $1 billion.

Moreover, Zell may have “lucked out” when he sold Long Island-based Newsday for $650 million to Cablevision Systems Corp. in May.

“Because the timing was perfect and there were three bidders in the game and Cablevision wanted to integrate, they overpaid,” Doctor said.

However good the Newsday deal, though, the crash of the residential and commercial real estate market is likely to depress any offer he might get for the historic Chicago Times and the L.A. Times buildings both of which are on the block.

Meanwhile, the morale the Los Angeles Times appears to be slipping as more editors and reporters face layoffs or voluntary departures.

“What bothers me is that the firings appear to be random, and not based on merit or ability,” said one former Times staffer. “The editors are asked to make a list and those on the list are fired. It really comes down to a popularity contest.”

So upset were some former employees that they filed a class action lawsuit, charging Zell and his top deputies with intentionally running the company into the ground for their own personal gain.

As part of his takeover plan, Zell was able to convince Times employees to purchase the newspaper using their pension fund money in exchange for an equity stake. But some employees believe the deal ended up lining the pockets of Zell and his top lieutenants, a claim that Zell has vigorously denied.

A handful of ex-Times staffers, lead by current staffer and Pulitzer Prize winning columnist Dan Neil, filed a complaint Sept. 16 in Los Angeles federal court claiming Zell and his associates have diminished the value of the employee-owned company to benefit himself and his fellow board members.

The complaint also alleges that through their destructive management and self-dealings at the expense of employees, Zell and his co-fiduciaries have repeatedly breached their fiduciary duties to beneficiaries of the Tribune Employee Stock Ownership Plan. The case is pending class action approval.