The plan was drawn up by Alan Hardy, the deputy managing director of Yorkshire-Tyne Tees, and approved at a board meeting last week. The first casualty came on Friday, when Ian Ritchie, the managing director of Tyne-Tees, resigned.
His resignation followed months of battles with Clive Leach, the managing director of Yorkshire-Tyne Tees, over the future of the company. 'Clive has been consistent about what he wants and why, but Ian thought he could make him see sense,' said one Tyne Tees insider.
Three non-executive directors of Yorkshire-Tyne Tees and two directors of Tyne Tees are understood to be considering their positions. Senior staff at Tyne Tees' Newcastle offices have also said they may resign.
In addition, Yorkshire-Tyne Tees runs the risk that the Independent Television Commission, which regulates commercial television, may review Tyne-Tees' ITV licence and could even revoke it.
Yorkshire-Tyne Tees has been told by David Glencross, chief executive of the ITC, that he will take no action until the plans are implemented, but if there is a significant change to programme quality the ITC may intervene.
A number of senior figures from Tyne Tees are also sounding out local politicians, including two senior Labour MPs, Tony Blair and Peter Mandelson, to see if they can intervene. 'The row over Tyne Tees is going to make Anne Clywd's challenge to Granada's licence sound like a storm in a teacup,' said a source close to the group.
Granada TV, which unsuccessfully bid against Tyne-Tees for the North-East franchise, is believed to be interested in picking up the pieces if the franchise is taken away from Yorkshire-Tyne Tees.
Mr Hardy's plan involves transferring all the operations of Tyne Tees' studios in City Road, Newcastle - apart from the making of local news programmes - to the group's headquarters in Leeds. This would involve the loss of up to 100 jobs, on top of the 300 redundancies implemented by Yorkshire-Tyne Tees last autumn.
The plan will end Tyne Tees' position as a separate company. Mr Hardy has also proposed that the City Road studios be closed and a smaller site in Newcastle be found. However, this has not yet been agreed.