The Irvine, Calif., company said the Register and its other newspapers and magazines would continue publishing while it reorganizes its finances in Bankruptcy Court. Freedom said that a majority of its lenders would support a pre-negotiated restructuring plan that will ease the company's debt load. 'Reaching this agreement with our lenders provides us with an orderly process to re-align our balance sheet with the realities of today's media environment,' said Burl Osborne, Freedom's chief executive. He said the company has sufficient cash to fund its daily operations. As the recession and online competition chewed into newspaper profits the past two years, Freedom has struggled to manage its debt load. The debt is a legacy of the 2004 transaction in which private equity firms Blackstone Group and Providence Equity Partners paid almost $470 million for a 40 percent stake in the company. A Blackstone Group spokeswoman said the bankruptcy filing is likely to wipe out the firms' investment. One roadblock to avoiding bankruptcy apparently was an inability to craft an agreement that was acceptable to all 26 of the company's lenders. Under the plan, Freedom's lenders will swap much of what they are owed for a majority stake in the company, a spokesman said. The deal with Blackstone and Providence followed a long-running rift among the descendants of Freedom founder R.C. Hoiles, the libertarian son of an Ohio farmer who bought the Santa Ana Register in 1935. Some family members wanted to keep the company, while others wanted to sell it and cash out their holdings. A compromise was reached that gave the private equity investors a minority stake in the company for buying out those who wanted to sell, and allowed the remaining members of the Hoiles family to retain majority control. The deal failed to reconcile many of the family members who stood on opposite sides of the dispute, and the bankruptcy filing is only making matters worse. 'There are a ton of wounds in that family,' said a person who knows several family members well. If the bankruptcy pushes the family out of the business, 'It's going to be an incredibly difficult thing for them to deal with the loss of the Register,' the person said. 'And it's not a financial thing. It's, `Oh my God, what would grandpa say about this?' ' In addition to the flagship Register -- No. 30 in the nation in circulation -- Freedom owns 32 daily papers, more than 70 weekly newspapers, magazines and other specialty publications, as well as eight TV stations. In the years since the Blackstone-Providence deal, the double whammy of recession and online competition has led to steep declines in circulation and in advertising revenue, particularly for lucrative classified ads. In recent years the Register launched the OC Post and SqueezeOC, a pair of tabloids with short stories and big pictures designed to capture young, busy readers. Both failed. The paper and its owner have also experienced management turnover. Most recently, Freedom Chief Executive Scott Flanders left in June to lead Playboy Enterprises Inc. 