Exhibit 10.1
FIRST AMENDMENT TO TAX MATTERS AGREEMENT
This First Amendment to Tax Matters Agreement (this “Amendment”) is dated as of
September 14, 2009, by and between Belo Corp., a Delaware corporation (“Belo”),
and A. H. Belo Corporation, a Delaware corporation (“A. H. Belo” and, together
with Belo, each, a “Party” and collectively, the “Parties”). Any capitalized
terms used herein for which definitions are not provided in this Amendment shall
have the same meanings assigned to such terms in the Tax Matters Agreement
between the Parties dated as of February 8, 2008 (the “Original Agreement”).
RECITALS
WHEREAS, A. H. Belo and its subsidiaries were members of the Belo Consolidated
Group;
WHEREAS, Belo distributed all of the shares of stock of A. H. Belo to the
shareholders of Belo (the “Distribution”) on February 8, 2008;
WHEREAS, as a result of the Distribution, A. H. Belo Group ceased to be included
in the Belo Consolidated Group;
WHEREAS, the Parties entered into the Original Agreement in connection with the
Distribution to allocate the Tax responsibilities, liabilities and benefits of
transactions that occurred on, prior to and after the date of the Distribution
and to address other Tax matters; and
WHEREAS, the Parties desire to make certain amendments to the Original
Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants and
agreements herein, the Parties (each on behalf of itself and each of its
Affiliates) hereby agree as follows:
1. Section 2.07 is deleted in its entirety and the following inserted in lieu
thereof:
Section 2.07 Carrybacks.
(a) Except as otherwise provided in Sections 2.07(b) and 2.07(c), A. H. Belo
shall file (or cause to be filed) on a timely basis any available election to
waive the carryback of net operating losses, Tax credits or other Tax Items by
A. H. Belo or any Affiliate from a Post-Distribution Tax Period to a Straddle
Period or Pre-Distribution Tax Period.
(b) A. H. Belo Group shall carryback its net operating loss determined for
federal, state and local Income Tax purposes for its Post-Distribution Tax
Period ending December 31, 2008 into the Pre-Distribution Tax Period of the Belo
Consolidated Group ending December 31, 2007 by not making the election pursuant
to Treasury Regulation Section 1.1502-21(b)(3)(ii)(B) (or any equivalent state
or local Income Tax authority) and not making the election pursuant to Treasury
Regulation 1.1502-

 

 

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21(b)(3)(i) (or any equivalent state or local Income Tax authority) for such
Post-Distribution Tax Period and by not otherwise relinquishing the carryback
period for which the A. H. Belo Group was a member of the Belo Consolidated
Group. A. H. Belo shall provide to Belo a copy of its Income Tax Returns for its
Post-Distribution Tax Period ending December 31, 2008 and any other materials
and information required by Belo to file the necessary Returns in order to
obtain any available Refunds (for federal, state or local Income Tax purposes)
for the Pre-Distribution Tax Period of the Belo Consolidated Group ending
December 31, 2007. Belo shall file such Returns and any Refunds resulting from
such carrybacks shall be allocated to the Parties on such basis as the Parties
shall agree in writing. Belo shall pay to A. H. Belo the portion of any Refund
to which it is entitled within ten (10) days of receiving the Refund from the
applicable Taxing Authority or if agreed to by the Parties in writing, Belo
shall hold such portion on behalf of A. H. Belo to satisfy other obligations of
A. H. Belo to Belo.
(c) If A. H. Belo and Belo agree in writing for the A. H. Belo Group to
carryback any net operating loss determined for federal, state or local Income
Tax purposes for its Post-Distribution Tax Period ending December 31, 2009 into
the Income Tax period of the Belo Consolidated Group ending December 31, 2008,
A. H. Belo shall provide to Belo a copy of its Income Tax Returns for its
Post-Distribution Tax Period ending December 31, 2009 and any other materials
and information required by Belo to file the necessary Returns in order to
obtain any available Refunds (for federal, state or local Income Tax purposes)
for the Income Tax period of the Belo Consolidated Group ending December 31,
2008. In such case, Belo shall file such Returns, and any Refunds resulting from
such carrybacks shall be divided between the Parties as the Parties shall agree
in writing. Belo shall pay to A. H. Belo the portion of any Refund to which it
is entitled within ten (10) days of receiving the Refund from the applicable
Taxing Authority or if agreed to by the Parties in writing, Belo shall hold such
portion on behalf of A. H. Belo to satisfy other obligations of A. H. Belo to
Belo. If the Parties fail to agree on the carryback of such net operating
losses, A. H. Belo shall make an election pursuant to Treasury
Regulation Section 1.1502-21(b)(3)(i) (and any equivalent state or local Income
Tax authority) not to carryback such net operating loss on its Income Tax
Returns for its Post-Distribution Tax Period ending December 31, 2009.
(d) If A. H. Belo has a Tax Item that must be carried back to any
Pre-Distribution Tax Period other than pursuant to Section 2.07(b) or
Section 2.07(c), A. H. Belo shall notify Belo in writing that such Tax Item must
be carried back. Such notification shall include a description in a reasonable
detail of the grounds for the Refund and the amount thereof, and a certification
by an appropriate officer of A. H. Belo setting forth

 

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A. H. Belo’s belief (together with supporting analysis) that the Tax treatment
of such Tax Item is more likely than not correct, and is not a Tax Item arising
from a Reportable Transaction.
(e) If Belo receives a Refund pursuant to the provisions of Section 2.07(b) or
Section 2.07(c) and pays all or a portion of the Refund to A. H. Belo (or holds
all or such portion on behalf of A. H. Belo to satisfy other obligations of A.
H. Belo to Belo) pursuant to either such Section and a Tax Contest occurs with
respect to the carryback of the net operating loss, Belo and A. H. Belo shall
jointly control such Tax Contest. Neither Party shall have the right to settle
any such Tax Contest without the consent of the other Party. All out-of-pocket
costs incurred by the Parties in obtaining the Refund, shall be borne by the
Parties on such basis as the Parties shall agree in writing. Any amount of
Refund received pursuant to Section 2.07(b) or Section 2.07(c) which is required
to be repaid pursuant to a Final Determination, together with any interest,
fines, additions to tax or additional amounts imposed by a Taxing Authority
relating to such Refund and any out-of-pocket costs incurred in handling or
contesting the Tax Contest shall be borne by the Parties on such basis as the
Parties shall agree in writing.
(f) If, notwithstanding the provisions of Section 2.07(a), A. H. Belo is
required to carryback losses or credits other than the net operating losses
described in Section 2.07(b) or Section 2.07(c), A. H. Belo shall be entitled to
any Refund of any Tax obtained by Belo or a Belo Affiliate as a result of the
carryback of losses or credits of A. H. Belo or its Affiliate from any
Post-Distribution Tax Period to any Pre-Distribution Tax Period. Such Refund is
limited to the net amount received by Belo or a Belo Affiliate, net of any Tax
cost incurred by Belo or such Affiliate resulting from such Refund. Upon request
by A. H. Belo, Belo shall advise A. H. Belo of an estimate of any Tax cost Belo
projects will be associated with any carryback of losses or credits of A. H.
Belo or its Affiliates as provided in this Section 2.07(f).
(g) If Belo pays any amount to A. H. Belo under Section 2.07(f) and, as a result
of a subsequent Final Determination, A. H. Belo is not entitled to some or all
of such amount, Belo shall notify A. H. Belo of the amount to be repaid to Belo,
and A. H. Belo shall then repay such amount to Belo, together with any interest,
fines, additions to Tax, penalties or additional amounts imposed by a Taxing
Authority relating thereto.
2. This instrument may be executed by the Parties hereto individually or in
combination, in one or more counterparts, each of which shall be an original and
all of which shall together constitute one and the same instrument.

 

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3. To the extent that any provision herein shall directly conflict with any
provision of the Original Agreement, such provision contained herein shall
control. Any provisions of the Original Agreement which do not directly conflict
with the provisions herein are hereby ratified and confirmed in all respects,
shall continue to be of full force and effect and shall bind each of the Parties
hereto.
[Signature page to follow.]

 

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IN WITNESS WHEREOF, the Parties have caused this Amendment to be duly executed
as of the date first above written.

            BELO CORP.
      By:   /s/ Dennis A. Williamson         Dennis A. Williamson       
Executive Vice President/Chief Financial Officer        A. H. BELO CORPORATION
      By:   /s/ Alison K. Engel         Alison K. Engel        Senior Vice
President/Chief Financial Officer and Treasurer   

 

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