Exhibit 10.3

  

Execution Version

 

 

 

ASSET PURCHASE AGREEMENT

 

for

 

the SALE of TELEVISION STATION

 

WJCL(TV), SAVANNAH, GEORGIA

 

by and among

 

MEDIA GENERAL, INC.

 

MERCURY NEW HOLDCO, INC.

 

LIN TELEVISION CORPORATION

 

LIN LICENSE COMPANY, LLC 

 

WJCL HEARST TELEVISION LLC

 

and

 

HEARST TELEVISION INC.

 

 

 

 

 

Dated as of August 20, 2014

 

 

 
 

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Table of Contents 

 

  Page    

ARTICLE I DEFINITIONS  

1

Section 1.1.

Definitions

1

     

ARTICLE II PURCHASE AND SALE OF PURCHASED ASSETS  

12

Section 2.1.

Purchase and Sale of Purchased Assets

12

Section 2.2.

Excluded Assets

15

Section 2.3.

Assumption of Liabilities

16

Section 2.4.

Closing Date

19

Section 2.5.

Purchase Price

19

Section 2.6.

Determination of Estimated Purchase Price; Payment on Closing Date

19

Section 2.7.

Determination of Closing Date Working Capital and Purchase Price

19

Section 2.8.

Closing Date Deliveries

21

Section 2.9.

Further Assurances

22

Section 2.10.

Purchase Price Adjustment

23

Section 2.11.

Allocation of Purchase Price

23

     

ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES  

23

Section 3.1.

Organization and Qualification

23

Section 3.2.

Authority of the Seller Parties; No Conflict; Required Filings and Consents

24

Section 3.3.

Financial Statements

25

Section 3.4.

Operations Since Balance Sheet Date

25

Section 3.5.

No Undisclosed Liabilities

26

Section 3.6.

Taxes

26

Section 3.7.

Sufficiency of Assets; Title to Purchased Assets

27

Section 3.8.

Governmental Permits; FCC Matters

27

Section 3.9.

Real Property; Real Property Leases

27

Section 3.10.

Intellectual Property

30

Section 3.11.

Tangible Personal Property

31

Section 3.12.

Employees

32

Section 3.13.

Employee Relations

32

Section 3.14.

Contracts

32

Section 3.15.

Status of Contracts

33

Section 3.16.

No Violation, Litigation or Regulatory Action

34

Section 3.17.

Insurance

34

Section 3.18.

Employee Plans; ERISA

34

Section 3.19.

Environmental Protection

36

Section 3.20.

MVPD Matters

36

Section 3.21.

Certain Business Practices

37

Section 3.22.

Transactions with Related Parties

37

Section 3.23.

No Finder

37

 

 
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ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE BUYER  

38

Section 4.1.

Organization

38

Section 4.2.

Authority of the Buyer

38

Section 4.3.

Litigation

39

Section 4.4.

No Finder

39

Section 4.5.

Qualifications as FCC Licensee

39

Section 4.6.

Financial Capacity

40

     

ARTICLE V ACTION PRIOR TO THE CLOSING DATE  

40

Section 5.1.

Access to the Business

40

Section 5.2.

Notification of Certain Matters

40

Section 5.3.

FCC Consent; Other Consents and Approvals

41

Section 5.4.

Operations of the Station Prior to the Closing Date

42

Section 5.5.

Public Announcement

45

Section 5.6.

Multi-Station Contracts

45

     

ARTICLE VI ADDITIONAL AGREEMENTS

46

Section 6.1.

Taxes

46

Section 6.2.

Employees; Employee Benefit Plans

48

Section 6.3.

Control of Operations Prior to Closing Date

52

Section 6.4.

Bulk Transfer Laws

52

Section 6.5.

Use of Names

52

Section 6.6.

Accounts

53

Section 6.7.

Correspondence

53

Section 6.8.

Exclusivity

53

Section 6.9.

Non-Solicitation

54

     

ARTICLE VII CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SELLER PARTIES  

55

Section 7.1.

No Breach of Covenants and Warranties

55

Section 7.2.

No Restraint

55

Section 7.3.

Certain Governmental Approvals

55

Section 7.4.

Mergers

55

Section 7.5.

Deliveries

55

     

ARTICLE VIII CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BUYER  

56

Section 8.1.

No Breach of Covenants and Warranties

56

Section 8.2.

No Restraint

56

Section 8.3.

Certain Governmental Approvals

56

Section 8.4.

Closing Deliveries

56

Section 8.5.

Consents

57

Section 8.6.

Title Insurance

57

Section 8.7.

No Material Adverse Effect

57

     

ARTICLE IX INDEMNIFICATION

57

Section 9.1.

Indemnification by the Seller Parties

57

Section 9.2.

Indemnification by the Buyer

58

 

 
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Section 9.3.

Notice of Claims; Determination of Amount

58

Section 9.4.

Third Person Claims

59

Section 9.5.

Limitations; No Subrogation; Exclusive Remedies

61

Section 9.6.

No Special Damages; Mitigation

61

Section 9.7.

Effect of Knowledge

61

     

ARTICLE X TERMINATION  

62

Section 10.1.

Termination

62

Section 10.2.

Withdrawal of Certain Filings

63

     

ARTICLE XI GENERAL PROVISIONS  

63

Section 11.1.

Survival of Representations, Warranties and Obligations

63

Section 11.2.

Confidential Nature of Information

64

Section 11.3.

Governing Law

64

Section 11.4.

Exclusive Jurisdiction; Court Proceedings

65

Section 11.5.

Notices

65

Section 11.6.

Successors and Assigns; Third Party Beneficiaries

66

Section 11.7.

Access to Records after Closing

66

Section 11.8.

Entire Agreement; Amendments

67

Section 11.9.

Interpretation

67

Section 11.10.

Waivers

68

Section 11.11.

Expenses

68

Section 11.12.

Partial Invalidity

68

Section 11.13.

Execution in Counterparts

68

Section 11.14.

WAIVER OF JURY TRIAL

68

Section 11.15.

Specific Performance

69

Section 11.16.

Sealed Instrument

69

Section 11.17.

Guarantee

69

 

 
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EXHIBITS

Exhibit A   -  

Form of Bill of Sale and Assignment and Assumption Agreement

Exhibit B    -  

Form of Assignment of Seller FCC Authorizations

Exhibit C    -  

Form of Transition Services Agreement        

SCHEDULES

 

 
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 ASSET PURCHASE AGREEMENT

 

ASSET PURCHASE AGREEMENT, dated as of August 20, 2014 (this “Agreement”), by and
among (i) Media General, Inc., a Virginia corporation (“Media General”), (ii)
Mercury New Holdco, Inc., a Virginia corporation (“New Media General”), (iii)
LIN Television Corporation, a Delaware corporation and wholly-owned subsidiary
of LIN (“LIN TV”), (iv) LIN License Company, LLC, a Delaware limited liability
company (“Licensee” and together with Media General, New Media General, LIN, and
LIN TV, each a “Seller Party” and collectively, the “Seller Parties”), on the
one hand, and (v) WJCL Hearst Television LLC, a Delaware limited liability
company (the “Buyer”), and (vi) Hearst Television Inc., a Delaware corporation
(the “Buyer Guarantor”), on the other hand.

 

W I T N E S S E T H :

 

WHEREAS, LIN, New Media General and Media General are among the parties to the
Merger Agreement, pursuant to which Media General and LIN, and their respective
direct and indirect subsidiaries will become direct and/or indirect subsidiaries
of New Media General;

 

WHEREAS, on the date of this Agreement, LIN, together with certain of its direct
and indirect wholly-owned subsidiaries, own and operate the television broadcast
station WJCL(TV), Savannah, Georgia (the “Station”), pursuant to certain
authorizations issued by the Federal Communications Commission (the “FCC”);

 

WHEREAS, following the closing of the Mergers (as hereinafter defined), the
Buyer desires to purchase substantially all of the assets and assume certain of
the liabilities, and the Seller Parties desire to sell to the Buyer
substantially all of the assets and transfer certain of the liabilities, related
to, or used in the conduct and operation of the Station, on the terms and
subject to the conditions hereinafter set forth; and

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, it is hereby agreed among the parties as follows:

 

ARTICLE I

DEFINITIONS

 

Section 1.1.     Definitions. As used in this Agreement, the following terms
have the meanings specified or referred to in this Section 1.1:

 

“Active Employees” has the meaning specified in Section 6.2(a).

 

“Affiliate” means, with respect to any Person, any other Person which directly
or indirectly controls, is controlled by or is under common control with such
Person.

 

“Agreed Accounting Principles” means GAAP, as used in the preparation of the
Balance Sheet, applied on a consistent basis.

 

“Agreed Adjustments” has the meaning specified in Section 2.7(b).

 

 

 
 

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“Agreement” has the meaning specified in the introductory paragraph hereof.

 

“Allocation” has the meaning specified in Section 2.11.

 

“Ancillary Agreements” means any certificate, agreement, document or other
instrument to be executed and delivered in connection with the transactions
contemplated by this Agreement.

 

“Arbitrator” has the meaning specified in Section 2.7(c).

 

“Assignment of the Seller FCC Authorizations” has the meaning specified in
Section 2.8(a)(ii).

 

“Assumed Contracts” has the meaning specified in Section 2.1(i).

 

“Assumed Liabilities” has the meaning specified in Section 2.3(a).

 

“Balance Sheet” has the meaning specified in Section 3.3.

 

“Balance Sheet Date” has the meaning specified in Section 3.3.

 

“Bill of Sale and Assignment and Assumption Agreement” has the meaning specified
in Section 2.8(a)(i).

 

“Business” means the business of owning and operating the Station.

 

“Business Day” means any day on which the principal offices of the Securities
and Exchange Commission are open to accept filings and on which banks in the
City of New York are not required or authorized to close.

 

“Buyer” has the meaning specified in the introductory paragraph hereof.

 

“Buyer Guarantor” has the meaning specified in the introductory paragraph
hereof.

 

“Buyer’s 401(k) Plan” has the meaning specified in Section 6.2(b).

 

“Buyer Ancillary Agreements” has the meaning specified in Section 4.2(a).

 

“Buyer Group Member” means the Buyer, its Affiliates, and each of their
successors and assigns, and their respective directors, officers, employees,
partners, stockholders, representatives and agents, and each of their heirs,
executors, successors and assigns.

 

“Cap” has the meaning specified in Section 9.1.

 

“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. §§ 9601 et seq., and any regulations promulgated
thereunder.

 

“Claim Notice” has the meaning specified in Section 9.3(a).

 

 

 
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“Closing” has the meaning specified in Section 2.4.

 

“Closing Date” has the meaning specified in Section 2.4.

 

“Closing Date Balance Sheet” has the meaning specified in Section 2.7.

 

“Closing Date Payment” has the meaning specified in Section 2.6(b).

 

“Closing Date Working Capital Amount” means the amount, if any, by which (i) the
Current Assets as of the Cutoff Time exceed (ii) the Current Liabilities as of
the Cutoff Time; provided that if such Current Assets are equal to or less than
such Current Liabilities, then the Closing Date Working Capital Amount shall be
zero.

 

“Closing Date Working Capital Deficit” means the amount, if any, by which (i)
the Current Liabilities as of the Cutoff Time exceed (ii) the Current Assets as
of the Cutoff Time; provided that if such Current Liabilities are equal to or
less than such Current Assets, then the Closing Date Working Capital Deficit
shall be zero.

 

“Code” means the Internal Revenue Code of 1986, as amended, and the applicable
Treasury Regulations issued thereunder.

 

“Communications Act” means the Communications Act of 1934, as amended, the
Telecommunications Act of 1996, the Children’s Television Act of 1992, and the
rules, regulations, Orders, and policies or other Laws of the FCC promulgated
under the foregoing, in each case, as in effect from time to time.

 

“Compensation Arrangement” has the meaning specified in Section 3.18.

 

“Confidential Information” has the meaning specified in Section 11.2.

 

“Confidentiality Agreement” has the meaning specified in Section 5.1.

 

“Contract” shall mean any written or oral contract, agreement, lease, license,
understanding or other arrangement or commitment (including any amendment or
modification thereto) to which a Person is a party, by which a Person is bound
or by which any of the assets or properties of a Person is bound.

 

“Current Assets” means the current assets of the Business determined in
accordance with the Agreed Accounting Principles, but excluding any Excluded
Assets.

 

“Current Liabilities” means current liabilities of the Business determined in
accordance with the Agreed Accounting Principles, but excluding any Excluded
Liabilities.

 

“Cutoff Time” means 11:59 P.M. (central time) on the date immediately prior to
the Closing Date.

 

“Deductible” has the meaning specified in Section 9.1.

 

“Disputed Items” has the meaning specified in Section 2.7(c).

 

 

 
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“DOJ” means the U.S. Department of Justice.

 

“DOJ Consent” means the consent, waiver, authorization or approval of, or a
filing, declaration or registration with the DOJ with respect to this Agreement
and the transactions contemplated hereby.

 

“DOJ Final Judgment” has the meaning specified in Section 3.2(c)(ii).

 

“Electing Party” has the meaning specified in Section 6.1(e).

 

“Employment Agreement” means any Contract of any of the Seller Parties or any of
their Affiliates with any individual Employee pursuant to which such Seller
Party or any of their Affiliates has an actual or contingent liability to
provide compensation and/or benefits in consideration for past, present or
future services.

 

“Employment Commencement Date” has the meaning specified in Section 6.2(a).

 

“Employees” means the individuals employed by any of the Seller Parties or any
of their Affiliates who are listed on Schedule 3.12 and any full-time, part-time
and per diem employees who become employed by any of the Seller Parties or any
of their Affiliates after the date hereof in accordance with Section 5.4
primarily in connection with the Business; provided, however, that no such
Person shall be considered an “Employee” if he or she is not employed by the
Seller Parties or any of their Affiliates immediately prior to the Closing. For
purposes of the foregoing, an individual shall not be considered “not employed”
by virtue of the fact that he or she is on authorized leave of absence, sick
leave, short term disability leave or military leave.

 

“Employee Plan” means each (i) pension, retirement, profit sharing, deferred
compensation, stock bonus or other similar plan, (ii) medical, vision, dental or
other health plan, (iii) life insurance plan and (iv) other employee benefit
plan, whether written or oral, in each case, to which a Seller Party or any of
their Affiliates or any ERISA Affiliate of the Seller Parties or their
Affiliates is required to contribute, or has any liability, whether actual or
contingent, or which a Seller Party or any of their Affiliates or any ERISA
Affiliate of the Seller Parties or their Affiliates sponsors for the benefit of
any of the Employees or any current or former employee, director, or independent
contractor of the Station or the Business, or under which Employees (or their
beneficiaries) or any current or former employee, director, or independent
contractor of the Station or the Business are eligible to receive benefits,
including any “Employee Benefit Plan” (as defined in Section 3(3) of ERISA),
including any Compensation Arrangement.

 

“Encumbrance” means any lien, claim, charge, security interest, mortgage,
encumbrance, pledge, option, right of first refusal, right of first offer,
attachment, easement, conditional sale or other title retention agreement,
defect in title, covenant or other restrictions of any kind, other than any
license of, option to license, or covenant not to assert claims of infringement
or misappropriation with respect to, Intellectual Property.

 

“Environmental Law” means all Laws relating to or addressing (i) the prevention
of pollution, the environment, natural resources, or occupational health or
safety, or (ii) the production, generation, release, discharge, emission,
disposal, transportation, containment or storage, clean up or remediation of any
condition involving any Hazardous Material, and the licensing, permitting or
regulation of any of the foregoing, including but not limited to CERCLA, OSHA
and RCRA and any state equivalent thereof.

 

 

 
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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“ERISA Affiliate” has the meaning specified in Section 3.18.

 

“Estimated Purchase Price” means the Purchase Price, as defined herein, but
determined on an estimated basis by the Seller Parties in good faith and as
reflected in the certificate referred to in Section 2.6(a).

 

“Event of Loss” means any loss, taking, condemnation or destruction of, or
damage to, any of the Purchased Assets.

 

“Excluded Assets” has the meaning specified in Section 2.2.

 

“Excluded Liabilities” has the meaning specified in Section 2.3(b).

 

“Excluded Taxes” means (i) all Taxes relating to the Business and the Purchased
Assets that are the responsibility of the Seller Parties or their Affiliates
pursuant to Section 6.1 of this Agreement, (ii) all Taxes relating to the
Excluded Assets or Excluded Liabilities for any period; and (iii) all Taxes owed
by the Seller Parties or any of their Affiliates for any period.

 

“Expenses” means any and all expenses incurred in connection with investigating,
defending or asserting any claim, action, suit or proceeding incident to any
matter indemnified against hereunder (including court filing fees, court costs,
arbitration fees or costs, witness fees, and reasonable fees and disbursements
of legal counsel, investigators, expert witnesses, consultants, accountants and
other professionals).

 

“FCC” means the Federal Communications Commission.

 

“FCC Applications” has the meaning specified in Section 5.3(a).

 

“FCC Consent” means action by the FCC (including action by staff acting on
delegated authority) granting its consent to the FCC Applications.

 

“Fee Title Documents” has the meaning specified in Section 3.9(b).

 

“Final Allocation Schedule” has the meaning specified in Section 2.11(c).

 

“Final Order” means an action or order of the FCC granting the FCC’s Consent in
writing (i) that has not been vacated, reversed, stayed, enjoined, set aside,
annulled or suspended; (ii) with respect to which no protest, request for stay,
reconsideration or review by the FCC on its own motion or by any third party,
petition for FCC reconsideration or for rehearing, application for FCC review,
or judicial appeal of such action or order is pending; and (iii) as to which the
period provided by Law for initiating such protest, request for stay,
reconsideration or review by the FCC on its own motion, petition for FCC
reconsideration or for rehearing, application for FCC review, or judicial appeal
of such action or order has expired.

 

 

 
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“Financial Statements” has the meaning specified in Section 3.3.

 

“FTC” means the U.S. Federal Trade Commission.

 

“Fundamental Representations” has the meaning set forth in Section 11.1.

 

“GAAP” means United States generally accepted accounting principles and
practices.

 

“Governmental Body” means any foreign, federal, state, local or other
governmental authority, or judicial or regulatory body.

 

“Governmental Permits” means registrations, licenses, permits, approvals,
consents, certificates, Orders, and authorizations of or from a Governmental
Body and all applications therefor, together with any renewals, extensions, or
modifications thereto.

 

“Hazardous Materials” means any waste, pollutant, hazardous substance, toxic
substance, hazardous waste, special waste, regulated or defined as “hazardous,”
“toxic” or words of similar import pursuant to any Environmental Law, including
asbestos, asbestos containing material, petroleum or petroleum-derived substance
or waste, or any constituent of any such substance or waste.

 

“Inactive Employees” has the meaning specified in Section 6.2(a).

 

“Included Proceeds” has the meaning specified in Section 2.1(j).

 

“Income Statement” has the meaning specified in Section 3.3.

 

“Indebtedness” means, for any Person without double counting, (a) all
indebtedness or other obligations of such Person (i) for borrowed money and/or
(ii) evidenced by notes, bonds or similar instruments, (b) obligations of such
Person for the deferred purchase price of property or services, conditional sale
obligations or title retention policies (excluding trade accounts payable), (c)
all obligations under leases that are or should be, in accordance with GAAP,
recorded as capital leases in respect of which such Person is liable as lessee,
(d) all obligations owed pursuant to any letter of credit or interest rate,
currency swap or hedging agreement or transaction, or other interest bearing
obligation, (e) any of the foregoing obligations which is secured by an
Encumbrance on the property or assets of such Person, (f) all accrued and unpaid
interest on, and applicable prepayment premiums, breakages costs, penalties or
similar contractual charges arising as a result of the discharge at Closing of,
any such foregoing obligations, and (g) any of the foregoing for which such
Person is liable as an obligor, guarantor, surety or otherwise; provided, that
Indebtedness shall not include accounts payable to trade creditors, accrued
expenses, deferred revenues arising in the ordinary course of business, and
capitalized lease obligations or liabilities, in each case only to the extent
included in the Closing Date Working Capital Amount or the Closing Date Working
Capital Deficit.

 

 

 
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“Indemnified Party” has the meaning specified in Section 9.3(a).

 

“Indemnitor” has the meaning specified in Section 9.3(a).

 

“Intellectual Property” means all (a) patents, patent applications and
inventions and discoveries that may become patentable, (b) Trademarks, (c)
copyrights (registered and unregistered), (d) registrations and applications for
registration of any of the foregoing in (a)-(c), (e) trade secrets, including
advertising customer lists, mailing lists, processes, and know-how, (f) moral
rights, publicity rights, data base rights and any other proprietary or
intellectual property rights of any kind or nature that are not covered by
(a)-(e) above, and (g) intellectual property rights arising from or associated
with the foregoing in (a)-(f) above.

 

“Knowledge of the Seller Parties” means, as to a particular matter, the actual
knowledge, after reasonable due inquiry, of the following persons: Vincent L.
Sadusky, Richard J. Schmaeling, Denise M. Parent and the Station Manager,
Business Manager and Station Chief Engineer for the Station.

 

“Laws” means any and all domestic (federal, state or local) or foreign or
provincial laws, statutes, ordinances, rules, regulations, judgments, Orders,
ordinances, injunctions, awards, or agency policies, procedures, requirements or
decrees promulgated by any Governmental Body.

 

“Leased Real Property” means all land, buildings, structures, towers,
improvements, fixtures, or other interests in real property that are leased or
licensed by any of the Seller Parties or their Affiliates as tenant, subtenant,
licensee or sublicensee, and used or held for use primarily in the Business,
together with any rights, title and interest of the Seller Parties and their
Affiliates as tenant or subtenant pursuant to a Real Property Lease therefor.

 

“liabilities” or “liability” means any and all direct or indirect Indebtedness,
liabilities, obligations, costs, expenses, claims, losses, damages, deficiencies
or responsibilities, whether known or unknown, accrued or fixed, absolute or
contingent, liquidated or unliquidated, choate or inchoate, subordinated or
unsubordinated, matured or unmatured, secured or unsecured or determined or
determinable, whether or not of a kind required by GAAP to be set forth on a
financial statement, including those arising under any applicable Law and those
arising on account of governmental, regulatory or administrative charges or
lawsuit brought, under any Contract or otherwise.

 

“Licensee” has the meaning specified in the introductory paragraph hereof.

 

“Like-Kind Exchange” has the meaning specified in Section 6.1(e).

 

“LIN” means LIN Media LLC, a Delaware limited liability company.

 

“LIN TV” has the meaning specified in the introductory paragraph hereof.

 

“Loss” means any and all losses, costs, obligations, liabilities, settlement
payments, claims, awards, judgments, fines, penalties, damages, expenses,
interest, deficiencies or other charges.

 

 

 
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“Market” means, with respect to the Station, the “Designated Market Area,” as
determined by The Nielsen Company, of the Station.

 

“Material Adverse Effect” means any event, change, occurrence, or effect that
would have a material adverse effect on (i) the ability of the Seller Parties to
perform their obligations under this Agreement, or (ii) the business,
properties, assets, liabilities, results of operations or condition (financial
or otherwise) of the Business, taken as a whole; provided, however, that for
purposes of determining whether there has been or is reasonably likely to be a
“Material Adverse Effect” for purposes of clause (ii), the results and
consequences of the following events, occurrences, facts, conditions, changes,
developments or effects shall not be taken into account (except in the case of
clauses (a), (c), (d), (e), (f) and/or (g), that such change or development
shall be taken into account to the extent, and only to the extent, that they
have adversely affected the Business, taken as a whole, in a manner that is
disproportionate to the degree that they have affected other television
broadcast companies): (a) any changes to general economic conditions, or to the
television broadcasting industry, in each case including such changes in any
such conditions occurring in the Market of the Station, (b) the execution and
delivery of this Agreement, the announcement of this Agreement (including the
identity of the Buyer and its Affiliates) and the transactions contemplated
hereby, the consummation of the transactions contemplated hereby, the compliance
with the terms of this Agreement or the taking of any action expressly required
by, or the failure to take any action expressly prohibited by, this Agreement or
consented to by Buyer in writing (including in each case the impact thereof on
relationships, contractual or otherwise, with agents, customers, suppliers,
vendors, licensees, licensors, lenders, partners, employees or regulators,
including the FCC), (c) any failure of the Business to meet internal or external
projections or forecasts or any estimates of earnings, revenues or other metrics
for any period (provided, however, that any event, occurrence, fact, condition,
change, development or effect giving rise to such failure or change may be taken
into account in determining whether there has been, or is reasonably likely to
be, a Material Adverse Effect, except to the extent otherwise excluded
hereunder), (d) any changes in the capital, financial or securities markets in
the United States, (e) changes in Laws or generally accepted accounting
principles (or the interpretation thereof), (f) the commencement, escalation or
worsening of any war or armed hostilities or the occurrence of acts of terrorism
or sabotage occurring after the date hereof affecting the United States, and (g)
earthquakes, hurricanes, floods or other natural disasters affecting the United
States.

 

“Media General” has the meaning specified in the introductory paragraph hereof.

 

“Merger Agreement” means that certain Agreement and Plan of Merger, dated as of
March 21, 2014, as it may be amended from time to time, by and among Media
General, New Media General, Mercury Merger Sub 1, Inc., a Virginia corporation
and a wholly-owned subsidiary of New Media General, Mercury Merger Sub 2, LLC, a
Delaware limited liability company and a wholly-owned subsidiary of New Media
General and LIN.

 

“Mergers” means (i) the merger of Mercury Merger Sub 1, Inc. with and into Media
General with Media General being the surviving company and (ii) the merger of
Mercury Merger Sub 2, LLC with and into LIN, with LIN being the surviving
limited liability company, in each case pursuant to the Merger Agreement.

 

 

 
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“MVPD” means any multi-channel video programming distributor, including cable
systems, telephone companies and direct broadcast satellite systems.

 

“New Media General” has the meaning specified in the introductory paragraph
hereof.

 

“Non-Fundamental Representations” has the meaning set forth in Section 11.1.

 

“Objection Notice” has the meaning specified in Section 2.7(b).

 

“Order” means any decree, order, judgment, injunction, awards, stipulations,
decrees or writs, temporary restraining order or other order in any suit or
proceeding by or with any Governmental Body.

 

“OSHA” means the Occupational Safety and Health Act, 29 U.S.C. §§ 651 et seq.,
and any regulations promulgated thereunder.

 

“Owned Real Property” means all land, together with all buildings, structures,
towers, improvements and fixtures located thereon, including all electrical,
mechanical, plumbing and other building systems, fire protection, security and
surveillance systems, telecommunications, computer wiring, and cable
installations, utility installations, water distribution systems, and
landscaping, together with all easements and other rights and interests
appurtenant thereto (including air, oil, gas, mineral, and water rights), owned
by any of the Seller Parties or their Affiliates and used or held for use
primarily in the Business.

 

“Permitted Encumbrance” means (a) liens for Taxes, assessments or other
governmental charges which are not yet due and payable or Taxes being contested
in good faith by appropriate proceedings and for which the Seller Parties
maintain adequate reserves on their books (which Taxes being contested, if any,
are listed on Schedule 1.1), (b) terms and conditions of any leases assumed by
Buyer, (c) zoning laws and ordinances and similar Laws that are not materially
violated by any existing improvement or that do not prohibit the use of the Real
Property as currently used in the operation of the Business; (d) any right
reserved to any Governmental Body to regulate the affected property; (e) in the
case of any leased asset, (i) the rights of any lessor under the applicable
lease agreement or any Encumbrance granted by any lessor, (ii) any statutory
lien for amounts that are not yet due and payable or are being contested in good
faith by appropriate proceedings and for which appropriate reserves have been
created in accordance with GAAP, (iii) any subleases listed in any Schedule
hereto and (iv)  the rights of the grantor of any easement or any Encumbrance
granted by such grantor on such easement property; (f) easements, rights of way,
restrictive covenants and other encumbrances, encroachments or other similar
matters affecting title that do not materially adversely affect title to the
property subject thereto and do not materially impair or interfere with (and are
not materially violated by) the continued use of the property in the ordinary
course of the Business as currently conducted; (g) inchoate materialmens’,
mechanics’, workmen’s, repairmen’s or other like liens arising in the ordinary
course of the Business for amounts that are not yet due and payable or that are
being contested in good faith by appropriate proceedings and for which
appropriate reserves have been created in accordance with GAAP; (h) Encumbrances
that will be discharged prior to or simultaneously with Closing; and (i) any
other Encumbrance designated as Permitted Encumbrances on Schedule 1.1 hereto
under the heading “Permitted Encumbrances”, if any.

 

 

 
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“Person” means any person, employee, individual, corporation, limited liability
company, partnership, trust, or any other non-governmental entity or any
governmental or regulatory authority or body.

 

“Preliminary Allocation Schedule” has the meaning specified in Section 2.11(a).

 

“Preliminary Closing Date Balance Sheet” has the meaning specified in Section
2.7(a)(i).

 

“Preliminary Closing Date Working Capital Calculation” has the meaning specified
in Section 2.7(a)(iii).

 

“Preliminary Purchase Price” has the meaning specified in Section 2.7(a)(ii).

 

“Proceeding” means any suit, litigation, arbitration, mediation, alternative
dispute resolution, claim, action, proceeding, hearing, audit, inquiry,
examination or investigation.

 

“Purchased Assets” has the meaning specified in Section 2.1.

 

“Purchased Intellectual Property” the meaning specified in Section 2.1(h).

 

“Purchase Price” has the meaning specified in Section 2.5.

 

“RCRA” means the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et
seq., and any regulations promulgated thereunder.

 

“Real Property” has the meaning specified in Section 3.9(c).

 

“Real Property Leases” means Contracts granting the Seller Parties or their
Affiliates the right of use or occupancy of any portion of the Leased Real
Property, or any Contract to which one of the Seller Parties or their Affiliates
is a party and granting any other Person the right of use or occupancy of any
portion of the Owned Real Property or Leased Real Property, together with any
amendments, modifications or supplements thereto.

 

“Receivables” means all receivables (including accounts receivable, loans
receivable and advances) arising from or related to the Business.

 

“Related Party” with respect to any specified Person, means: (i) any Affiliate
of such specified Person and (ii) any director, executive officer, general
partner or managing member of such specified Person or that Person’s Affiliates;
and (iii) for Person’s covered by (i) or (ii) such Person’s family members to
the extent such familial relationship is known to the Knowledge of the Seller
Parties.

 

 

 
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“Release” means any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
indoor or outdoor environment or into or out of any property, building,
structure, facility or fixture, including the movement of Hazardous Materials
through or in the ambient or indoor air, soil, land surface, subsurface strata,
surface water, groundwater or property.

 

“Required Consents” has the meaning specified in Section 5.3(c).

 

“Resolution Period” has the meaning specified in Section 2.7(b).

 

“Retained Names and Marks” means all (a) Trademarks containing or incorporating
the terms “Media General” or “LIN,” (b) other Trademarks owned by any Seller
Party (other than Trademarks included in the Purchased Intellectual Property),
(c) variations or acronyms of any of the foregoing (other than Trademarks
included in the Purchased Intellectual Property), and (d) Trademarks confusingly
similar to or dilutive of any of the foregoing (other than Trademarks included
in the Purchased Intellectual Property).

 

“Review Period” has the meaning specified in Section 2.7(b).

 

“Seller Expenses” means, without duplication, all of the fees, expenses, costs,
charges, payments and other obligations that are incurred by or on behalf of the
Seller Parties and/or their Affiliates or for which the Seller Parties and/or
their Affiliates are otherwise liable in connection with the transactions
contemplated by this Agreement and the Ancillary Agreements (whether incurred or
to be paid prior to, at or after Closing), including (i) the fees and expenses
of the Seller Parties’ and/or their Affiliates’ respective bankers, counsel,
accountants, advisors, agents and representatives, and (ii) any success, change
of control, special or other bonuses or similar amounts payable by the Seller
Parties and/or their Affiliates to any employee, officer or director upon or in
connection with the consummation of the transactions contemplated by this
Agreement and the Ancillary Agreements.

 

“Seller FCC Authorizations” means those Governmental Permits issued by the FCC
with respect to the Station’s operations.

 

“Seller Group Member” means the Seller Parties, their Affiliates, and each of
their successors and assigns, and their respective directors, officers,
employees, partners, stockholders, representatives and agents and each of their
heirs, executors, successors and assigns.

 

“Seller Parties” has the meaning specified in the introductory paragraph hereof.

 

“Station” has the meaning specified in the first recital hereof.

 

“Station Agreements” has the meaning specified in Section 3.15.

 

“Straddle Period” has the meaning specified in Section 6.1(a).

 

“Tangible Personal Property” has the meaning specified in Section 2.1(h).

 

 

 
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“Tax” means any federal, state, local or foreign net income, alternative or
add-on minimum, gross income, gross receipts, estimated, franchise, real
property, personal property, sales, use, transfer, gains, license, employment,
severance, payroll, capital stock, escheat, environmental, franchise, social
security, unemployment, disability, excise, stamp, registration and value-added
taxes, withholding or minimum tax, or any other tax of any kind, whether
calculated on a separate or consolidated, unitary or combined basis or in any
other manner, together with any interest or any penalty, addition to tax or
additional amount imposed by any Governmental Body.

 

“Tax Return” means any return, declaration, report, claim for refund,
information return or statement, or other document relating to Taxes, including
any schedule or attachment thereto, and amendment thereof.

 

“Termination Date” has the meaning specified in Section 10.1(a)(v).

 

“Third Person Claim Notice” has the meaning specified in Section 9.4(a).

 

“Trademarks” means, whether registered or unregistered, trademarks, service
marks, domain names and other Internet addresses or identifiers, trade dress,
trade names, call signs, call letters, and corporate names, all applications and
registrations for the foregoing, and all common law rights and goodwill
connected with the use thereof and symbolized thereby.

 

“Transfer Taxes” means all transfer, documentary, excise, sales, value added,
goods and services, use, stamp, registration and other similar taxes, and all
conveyance fees, recording charges and other fees and charges, incurred in
connection with the consummation of the transactions contemplated by this
Agreement.

 

“Transferred Employees” has the meaning specified in Section 6.2(a).

 

“Transition Services Agreement” has the meaning specified in Section 2.8(a).

 

“Treasury Regulations” means the income tax regulations promulgated under the
Code, as such regulations may be amended from time to time.

 

“WARN Act” has the meaning specified in Section 6.2(i).

 

“WVTM Asset Purchase Agreement” means that certain Asset Purchase Agreement,
dated as of the date hereof, by and among Media General, Birmingham Broadcasting
Co., Inc., Media General Communications Holdings, LLC, WVTM Hearst Television
Inc. and Hearst Television Inc.

 

ARTICLE II

PURCHASE AND SALE OF PURCHASED ASSETS

 

Section 2.1.     Purchase and Sale of Purchased Assets. Upon the terms and
subject to the conditions of this Agreement, at the Closing, the Seller Parties
shall, or shall cause their Affiliates to, sell, transfer, assign, convey and
deliver to the Buyer, and the Buyer shall purchase from the Seller Parties and
their Affiliates, pursuant to this Agreement, free and clear of all Encumbrances
(except for Permitted Encumbrances), all of the right, title and interest of the
Seller Parties and their Affiliates to the assets, properties and business
(excepting only the Excluded Assets) of every kind and description, wherever
located, real, personal or mixed, tangible or intangible, used or held for use
primarily in the Business (herein collectively referred to as the “Purchased
Assets”), including, all right, title and interest of the Seller Parties and
their Affiliates as of Closing to the following (excepting only the Excluded
Assets):

 

 

 
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(a)     All assets recorded or reflected on the Balance Sheet (including assets
such as Contracts to which no value was attributed);

 

(b)     All assets acquired by the Seller Parties or their Affiliates since the
date of the Balance Sheet, which, had they been held by the Seller Parties or
their Affiliates on such date, would have been recorded or reflected on the
Balance Sheet in accordance with the Agreed Accounting Principles (including
assets such as Contracts to which no value would have been attributed);

 

(c)     The Receivables;

 

(d)     Any and all prepayments, prepaid rentals, deposits (including on
leasehold interests and utilities), and prepaid expenses outstanding at the
Closing and primarily relating to the Business, the Purchased Assets or the
Assumed Liabilities;

 

(e)     (x) The Seller FCC Authorizations and (y) all other assignable
Governmental Permits issued to, or required to be obtained or maintained by, the
Seller Parties or their Affiliates by a Governmental Body with respect to the
conduct or operation of the Business as currently conducted or the ownership or
use of the Purchased Assets;

 

(f)     All Owned Real Property and Leased Real Property, together with any and
all Real Property Leases;

 

(g)     All machinery, equipment (including cameras, computers, servers, and
office equipment and supplies), auxiliary and translator facilities,
transmitting towers, antennae support structures, guy anchors, guy wires,
transmitters, broadcast equipment, antennae, transmission lines, transmission
equipment, transmission facilities, antennae systems, cables, supplies,
inventory (including all films, programs, records, tapes, recordings, compact
discs, cassettes, spare parts and equipment), vehicles, furniture, furnishings,
fixtures, electrical devices, tools and other tangible personal property owned
or leased by the Seller Parties or any of their Affiliates and used or held for
use primarily in the Business (“Tangible Personal Property”);

 

(h)     All Intellectual Property owned by or licensed to the Seller Parties or
any of their Affiliates and used or held for use primarily in the Business,
including the call signs WJCL, WJCL-TV, WJCL(TV), WJCL-DT, and WJCL(DT)
(collectively, the “Purchased Intellectual Property”);

 

(i)     Subject to Section 5.6, (i) all Contracts that in their entirety relate
to the operation or conduct of the Business or the Station and (ii) that portion
of any other Contract to the extent it relates to the operation or conduct of
the Business or the Station. The foregoing shall include, but not be limited to
(w) all Contracts of the Seller Parties or any of their Affiliates to the extent
such Contracts are for the sale or barter of broadcast time on the Station for
advertising or other purposes; (x) all Contracts of the Seller Parties or any of
their Affiliates to the extent such Contracts are for the purchase or lease, as
applicable, of merchandise, supplies, equipment or other personal property, or
for the receipt of services, in each case used primarily in the Business; (y)
all Contracts listed or described in Schedule 3.14 designated therein as an
“Assumed Contract;” and (z) any other Contract entered into by any Seller Party
or any of its Affiliates primarily for the Business which (A) is of the general
nature described in Section 3.14, but which, by virtue of the threshold amounts
or other specific terms set forth therein, is not required to be listed in
Schedule 3.14 or (B) is entered into after the date hereof consistent with the
provisions of Section 5.4 of this Agreement (all Contracts described in this
Section 2.1(i), other than any Contracts that are Excluded Assets, are referred
to as the “Assumed Contracts”);

 

 

 
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(j)     All claims, causes of action, counterclaims, credits, choses in action,
rights of recovery, rights of set-off, rights of indemnification, and rights of
recoupment, including all claims for refund and indemnity claims, of the Seller
Parties or any of their Affiliates, as applicable, against third parties to the
extent such claims, causes of action, counterclaims, credits, choses in action,
and rights arise out of or relate to the Purchased Assets, the Assumed
Liabilities or the Business, including: (i) all rights under any Assumed
Contract, including all rights to receive payment for products sold and services
rendered thereunder, to receive goods and services thereunder, to assert claims
and to take other rightful actions in respect of breaches, defaults and other
violations thereof; (ii) all rights under or in respect of any Purchased
Intellectual Property, including all rights to sue and recover damages for past,
present and future infringement, dilution, misappropriation, violation, unlawful
imitation or breach thereof, and all rights of priority and protection of
interests therein under the Laws of any jurisdiction; (iii) all rights,
including rights to proceeds, under all guarantees, warranties, indemnities
arising from or related to the Business, the Purchased Assets or the Assumed
Liabilities and (iv) all proceeds and rights to insurance proceeds that relate
to an Event of Loss with respect to the Purchased Assets arising before the
Closing that has not been repaired or cured prior to the Closing Date (such
proceeds, the “Included Proceeds”);

 

(k)     All deposits made or held for the benefit of any of the Seller Parties
or any of their Affiliates under or pursuant to Contracts included in the
Purchased Assets;

 

(l)     All management and other systems (including computers, servers,
networking equipment, telecommunications equipment, and peripheral equipment),
databases, computer software, disks and similar assets owned or leased by the
Seller Parties or any of their Affiliates which are used or held for use
primarily in the Business, and all licenses of the Seller Parties or any of
their Affiliates to the extent relating thereto;

 

(m)     All books, records, ledgers, files, literature, or other similar
information of the Seller Parties or any of their Affiliates that relate
primarily to the Business (in any form or medium), including all logs,
programming information and studies, proprietary information, schematics,
technical information and engineering data, news and advertising studies or
consulting reports and sales correspondence, client lists, vendor lists,
correspondence, mailing lists, revenue records, invoices, advertising materials,
brochures, records of operation, standard forms of documents, manuals of
operations or business procedures, photographs, blueprints, research files and
materials, data books, the FCC required logs, files, and records, including the
Stations’ complete public inspection files, Intellectual Property disclosures
and information, media materials and plates, accounting records, Tax Returns and
litigation files primarily relating to the Business (but excluding the
organization documents, minute and stock record books and corporate seals of the
Seller Parties);

 

 

 
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(n)     All goodwill and going concern value relating to the Station and/or the
Business, and all other intangible property rights primarily relating to the
Business; and

 

(o)     All petty cash held at the Station.

 

Section 2.2.     Excluded Assets. Notwithstanding the foregoing, the Purchased
Assets shall not include the following (herein referred to as the “Excluded
Assets”):

 

(a)     Any cash or cash equivalents (including any marketable securities or
certificates of deposit) of the Seller Parties or any of their Affiliates, other
than petty cash held at the Station or Included Proceeds;

 

(b)     All bank and other depository accounts of the Seller Parties or any of
their Affiliates;

 

(c)     All claims, rights and interests of the Seller Parties or any of their
Affiliates in and to any refunds of Taxes or fees of any nature whatsoever for
periods (or portions thereof) ending on or prior to the Closing Date;

 

(d)     Any rights, claims or causes of action of the Seller Parties or any of
their Affiliates against third parties relating to the assets, properties or
operations of the Business arising out of transactions occurring prior to the
Closing Date, except to the extent that any such rights, claims or causes of
action are Current Assets or otherwise arise out of the Purchased Assets or
Assumed Liabilities (provided that the Seller Parties shall retain all amounts
payable to the Seller Parties, if any, from the United States Copyright Office
or such arbitration panels as may be appointed by the United States Copyright
Office that relate to the Business prior to the Closing and have not been paid
as of the Closing);

 

(e)     All bonds held, contracts of insurance or policies of insurance and
prepaid insurance with respect to such contracts or policies; and all insurance
claims and proceeds thereunder including relating to the Purchased Assets or the
Business other than the Included Proceeds;

 

(f)     The Seller Parties’ or their Affiliates’ minute books, stock transfer
books, records relating to formation or incorporation, Tax Returns and related
documents and supporting work papers and any other records and returns relating
to Taxes, assessments and similar governmental levies (other than real and
personal property Taxes, assessments and levies imposed on the Purchased Assets)
and any books and records not exclusively relating to the Business;

 

 

 
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(g)     All records prepared in connection with or relating to the sale or
transfer of the Station, including bids received from others and analyses
relating to the Station and the Purchased Assets;

 

(h)     The Contracts of the Seller Parties or their Affiliates listed in
Schedule 3.14 and not designated on such Schedule as an “Assumed Contract”, and
any Contracts between or among any one or more of the Seller Parties or their
Affiliates, on the one hand, and any one or more of their Related Parties, on
the other hand, relating to the Station or the Purchased Assets unless listed in
Schedule 3.14 as an “Assumed Contract”;

 

(i)     The items designated in Schedule 2.2(i) as “Excluded Assets”;

 

(j)     The Retained Names and Marks;

 

(k)     All Intellectual Property owned by the Seller Parties or any of their
Affiliates (other than the Purchased Intellectual Property);

 

(l)     All records and documents relating to Excluded Assets or to liabilities
other than Assumed Liabilities;

 

(m)     Other than as set forth in Section 6.2 with respect to flexible spending
accounts, all of the pension, profit sharing, welfare or employee benefit
agreements, plans or arrangements of the Seller Parties or their Affiliates
(including, without limitation, all Employee Plans) and any assets of any such
agreement, plan or arrangement;

 

(n)     Any intercompany receivables of the Business from the Seller Parties or
any of their Affiliates; and

 

(o)     Any rights of or payment due to the Seller Parties or their Affiliates
under or pursuant to this Agreement, any Ancillary Agreement or the
Confidentiality Agreement.

 

Section 2.3.     Assumption of Liabilities.

 

(a)     Upon the terms and subject to the conditions of this Agreement, as of
the Closing, the Buyer shall assume the following obligations and liabilities of
the Seller Parties related to the Business, whether direct or indirect, known or
unknown (except to the extent such obligations and liabilities constitute
Excluded Liabilities):

 

(i)     the liabilities arising out of or relating to the operation of the
Station on or after the Closing or the owning or holding of the Purchased Assets
on or after the Closing, to the extent such liabilities arise after the Closing
and do not relate to the operation of the Station or the owning or holding of
the Purchased Assets prior to the Closing;

 

(ii)     all liabilities recorded on the Balance Sheet;

 

 

 
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(iii)     all liabilities (including accounts payable and accrued expenses)
incurred by the Business subsequent to the Balance Sheet date in the ordinary
course of the Business consistent with past practice;

 

(iv)     subject to Section 5.6, all liabilities of the Seller Parties under the
Assumed Contracts to be performed after, or in respect of periods following, the
Closing (except to the extent that such liabilities were required by the terms
thereof to be discharged prior to the Closing);

 

(v)     all liabilities for Taxes that are the responsibility of the Buyer or
its Affiliates pursuant to Section 6.1 hereof; and

 

(vi)     all liabilities with respect to the Transferred Employees to be assumed
by the Buyer or its Affiliates pursuant to Section 6.2 hereof, if any.

 

All of the foregoing in this Section 2.3(a) to be assumed by the Buyer hereunder
are referred to herein as the “Assumed Liabilities.”

 

(b)     Except for the Assumed Liabilities, the Buyer shall not assume or be
obligated to pay, perform, or otherwise discharge any liability or obligation of
the Seller Parties or their Affiliates, and the Seller Parties and their
Affiliates, as applicable, shall solely retain, pay, perform, defend and
discharge (without recourse to Buyer) all of their liabilities and obligations
of any and every kind whatsoever, direct or indirect, known or unknown, absolute
or contingent (herein referred to as “Excluded Liabilities”). All of the
following shall be “Excluded Liabilities” for purposes of this Agreement, and
notwithstanding anything to the contrary in Section 2.3(a), none of the
following shall be “Assumed Liabilities” for purposes of this Agreement:

 

(i)     all liabilities that do not primarily relate to the Business or the
Purchased Assets;

 

(ii)     all liabilities arising out of the operation of the Station before the
Closing, or the owning or holding of the Purchased Assets before the Closing
(excluding any liability expressly assumed by the Buyer under Section 2.3(a));

 

(iii)     all liabilities arising out of the operation, owning or holding of the
Excluded Assets;

 

(iv)     all liabilities for Indebtedness of the Seller Parties or their
Affiliates;

 

(v)     all liabilities for Excluded Taxes;

 

(vi)     all liabilities for Seller Expenses;

 

(vii)     all liabilities arising from or solely related to any noncompliance
with any Law by the Seller Parties or their Affiliates;

 

 

 
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(viii)     all liabilities to the extent arising from or related to any
Proceedings against the Seller Parties or their Affiliates, the Business or the
Purchased Assets pending as of the Closing or based upon any action, event,
circumstance or condition arising prior to the Closing Date;

 

(ix)     all liabilities (x) arising out of any Contract that is not an Assumed
Contract or (y) relating to any breach, default or non-performance prior to
Closing by any of the Seller Parties or their Affiliates under any Assumed
Contract;

 

(x)     all liabilities of the Business pursuant to, under, or in respect of any
Environmental Law arising from or related to any action, event, circumstance or
condition occurring or existing prior the Closing Date;

 

(xi)     other than as set forth in Section 6.2, any of the liabilities under
the pension, profit sharing, welfare or employee benefit agreements, plans or
arrangements of the Seller Parties or their Affiliates (including, without
limitation, all Employee Plans) and any assets of any such agreement, plan or
arrangement;

 

(xii)     all liabilities (x) of the Seller Parties or their Affiliates under or
relating to the WARN Act and any similar state statutes and Laws, or (y)
relating to the termination by the Seller Parties or their Affiliates of the
Employees and independent contractors of the Seller Parties or their Affiliates
other than liabilities relating to the termination of Transferred Employees if
such termination occurred after the date of transfer;

 

(xiii)     all liabilities under Code Section 4980B or Sections 601-608 of ERISA
or other applicable Laws for any employee or independent contractor (and their
dependents) with respect to any group health plan of any of the Seller Parties
or their Affiliates;

 

(xiv)     all intercompany payables of the Business owing to any of the
Affiliates of the Seller Parties;

 

(xv)     all liabilities of the Business owing to any Related Parties of the
Seller Parties or any of their Affiliates except as set forth on Schedule 3.22;

 

(xvi)     all liabilities to indemnify, reimburse or advance amounts to any
present or former officer, director, employee or agent of the Seller Parties or
their Affiliates (including with respect to any breach of fiduciary obligations
by any such party);

 

(xvii)     all of the Seller Parties' and their Affiliates liabilities or
obligations under this Agreement or the Ancillary Agreements; and

 

(xviii)     all liabilities or obligations under any Contract between any Seller
Party or any Affiliate of the Seller Parties and the FCC, or any fines or
sanctions imposed by the FCC resulting from the operation of the Station prior
to the Closing Date.

 

 

 
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Section 2.4.     Closing Date. The purchase and sale of the Purchased Assets
provided for in Section 2.1 (the “Closing”) shall be consummated effective as of
12:00 A.M. (central time) five (5) Business Days after the conditions set forth
in Articles VII and VIII are satisfied or, if legally permissible, waived (other
than those conditions that by their nature are to be satisfied (or validly
waived) at the Closing, but subject to such satisfaction or waiver) (the
“Closing Date”). The Closing will be held at the offices of Fried, Frank,
Harris, Shriver & Jacobson LLP, One New York Plaza, New York, New York 10004, at
9:00 A.M., New York time, unless such time or date is changed by mutual
agreement of the Seller Parties and the Buyer.

 

Section 2.5.     Purchase Price. The purchase price for the Purchased Assets
(the “Purchase Price”) shall be equal to:

 

(i)     Four Million Five Hundred Thousand Dollars ($4,500,000) (the “Base
Purchase Price”), plus

 

(ii)     the Closing Date Working Capital Amount, or minus

 

(iii)     the Closing Date Working Capital Deficit.

 

Section 2.6.     Determination of Estimated Purchase Price; Payment on Closing
Date.

 

(a)     At least two (2) Business Days prior to the Closing Date, the Seller
Parties shall deliver to the Buyer a certificate executed on behalf of the
Seller Parties by an authorized officer thereof, dated the date of its delivery,
setting forth the Seller Parties’ good faith estimate of (i) the Closing Date
Working Capital Amount or the Closing Date Working Capital Deficit, as the case
may be, and (ii) the Estimated Purchase Price, all of which shall be derived
from an unaudited balance sheet of the Business, which includes the Current
Assets and Current Liabilities as of the Closing Date, prepared by the Seller
Parties in accordance with the Agreed Accounting Principles, which balance sheet
shall be attached to such certificate.

 

(b)     On the Closing Date, the Buyer shall pay the Seller Parties an amount
equal to the Estimated Purchase Price (the “Closing Date Payment”), by bank wire
transfer of immediately available funds to such bank account or accounts
designated by the Seller Parties for such purpose not less than one (1) Business
Day before the Closing Date.

 

Section 2.7.     Determination of Closing Date Working Capital and Purchase
Price.

 

(a)     As promptly as reasonably practicable following the Closing Date (but
not later than sixty (60) days after the Closing Date), the Buyer shall:

 

(i)     prepare, in accordance with the Agreed Accounting Principles, an
unaudited balance sheet of the Business, which includes the Current Assets and
Current Liabilities, as of the Cutoff Time (the “Preliminary Closing Date
Balance Sheet”);

 

 

 
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(ii)     determine the Purchase Price in accordance with the provisions of this
Agreement (such Purchase Price as determined by the Buyer being called the
“Preliminary Purchase Price”); and

 

(iii)     deliver to the Seller Parties a certificate executed by the Buyer
setting forth or attaching the Preliminary Closing Date Balance Sheet and the
Buyer’s calculation of the Closing Date Working Capital Amount or the Closing
Date Working Capital Deficit, as the case may be (the “Preliminary Closing Date
Working Capital Calculation”) derived therefrom and the Preliminary Purchase
Price.

 

(b)     The Seller Parties shall have sixty (60) days following receipt of the
certificate referenced in Section 2.7(a) (the “Review Period”) in which to
review the Preliminary Closing Date Balance Sheet, the Preliminary Purchase
Price and the Preliminary Closing Date Working Capital Calculation. In the event
the Seller Parties do not object to the Preliminary Closing Date Balance Sheet,
the Preliminary Purchase Price or the Preliminary Closing Date Working Capital
Calculation prior to expiration of the Review Period, the Preliminary Purchase
Price and the Preliminary Closing Date Working Capital Calculation shall become
(i) the “Purchase Price” and (ii) the “Closing Date Working Capital Amount” or
the “Closing Date Working Capital Deficit,” as the case may be, respectively,
for all purposes of this Agreement, including for purposes of determining the
adjustment payment (if any) specified in Section 2.10. In the event the Seller
Parties object to the Preliminary Closing Date Balance Sheet, the Preliminary
Purchase Price or the Preliminary Closing Date Working Capital Calculation, the
Seller Parties shall give a written notice to the Buyer specifying their
objections in reasonable detail and the basis therefor, prior to expiration of
the Review Period (“Objection Notice”). During the thirty (30) Business Day
period following the Buyer's receipt of the Objection Notice (the “Resolution
Period”), the Buyer and the Seller Parties shall attempt to resolve the
differences specified in the Objection Notice and any resolution by them
(evidenced in writing) of such differences (the “Agreed Adjustments”) shall be
final, binding and conclusive. In the event the Buyer and the Seller Parties
resolve all disputed items set forth in the Objection Notice by the conclusion
of the Resolution Period, the Preliminary Purchase Price and the Preliminary
Closing Date Working Capital Calculation, in each case as adjusted by the Agreed
Adjustments, shall become (x) the “Purchase Price” and (y) the “Closing Date
Working Capital Amount” or the “Closing Date Working Capital Deficit,” as the
case may be, respectively, for all purposes of this Agreement, including for
purposes of determining the adjustment payment (if any) specified in Section
2.10.

 

(c)     If at the conclusion of the Resolution Period any objections raised by
the Seller Parties remain unresolved, then the amounts so in dispute (the
“Disputed Items”) shall be submitted to a firm of independent public accountants
in the United States of national recognition with industry experience which does
not have a relationship with the parties (the “Arbitrator”) selected by the
Buyer and reasonably acceptable to the Seller Parties as promptly as possible
after the expiration of the Resolution Period. The Arbitrator shall determine
and resolve, based solely on presentations by the Buyer and the Seller Parties,
and not by independent review, the Disputed Items, in accordance with the Agreed
Accounting Principles. In resolving the Disputed Items, the Arbitrator’s
determination shall be no higher or lower than the respective amounts proposed
by the Buyer and the Seller Parties. The Arbitrator’s determination shall be
made within thirty (30) Business Days of its selection, shall be set forth in a
written statement delivered to the Buyer and the Seller Parties and shall be
final, binding and conclusive on the parties hereto. The Preliminary Purchase
Price and the Preliminary Closing Date Working Capital Calculation shall be
adjusted to reflect all Agreed Adjustments and the resolution of all Disputed
Items by the Arbitrator and, as so adjusted, shall be (i) the “Purchase Price”
and (ii) the “Closing Date Working Capital Amount” or the “Closing Date Working
Capital Deficit,” as the case may be, respectively, for all purposes of this
Agreement, including for purposes of determining the adjustment payment (if any)
specified in Section 2.10.

 

 

 
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(d)     The parties hereto shall make available to the Buyer, the Seller Parties
and, if applicable, the Arbitrator, such books, records and other information
(including work papers) as any of the foregoing may reasonably request to
prepare or review the Preliminary Closing Date Balance Sheet, the Preliminary
Purchase Price and the Preliminary Closing Date Working Capital Calculation or
any matters submitted to the Arbitrator. The fees and expenses of the Arbitrator
shall be paid by the Buyer, on the one hand, and the Seller Parties, on the
other hand, in inverse proportion as they may prevail on the matters submitted
to the Arbitrator pursuant to Section 2.7(c), which proportional allocations
shall also be determined by the Arbitrator at the time the determination of the
Arbitrator is rendered on the matters submitted.

 

Section 2.8.     Closing Date Deliveries.

 

(a)     At the Closing, the Seller Parties shall deliver or cause to be
delivered to the Buyer: (i) a bill of sale and assignment and assumption
agreement duly executed by the Seller Parties and, if applicable, their
Affiliates in substantially the form of Exhibit A (the “Bill of Sale and
Assignment and Assumption Agreement”), providing for the conveyance of all of
the Purchased Assets (other than the Owned Real Property and the Seller FCC
Authorizations) and the assumption of all of the Assumed Liabilities, (ii) an
assignment of the Seller FCC Authorizations duly executed by the appropriate
Seller Parties and their Affiliates, in substantially the form of Exhibit B (the
“Assignment of the Seller FCC Authorizations”), assigning to the Buyer the
Seller FCC Authorizations, (iii) a transition services agreement duly executed
by the appropriate Seller Parties and their Affiliates, in substantially the
form of Exhibit C (the “Transition Services Agreement”), (iv) special or limited
warranty deeds (in the customary form for such jurisdiction and in form and
substance reasonably acceptable to Buyer), duly executed by the appropriate
Seller Parties and their Affiliates, conveying to the Buyer the Owned Real
Property, (v) all of the documents and instruments required to be delivered by
the Seller Parties and/or their Affiliates pursuant to Article VIII, including
the Required Consents, (vi) certified copies of the certificate of incorporation
and bylaws of the Seller Parties, (vii) certified resolutions of the Board of
Directors and shareholders (if applicable) of the Seller Parties authorizing the
transactions contemplated by this Agreement and the Ancillary Agreements, (viii)
a duly executed certificate of the secretary of each of the Seller Parties as to
incumbency and specimen signatures of officers of the Seller Parties executing
this Agreement and the Ancillary Agreements, (ix) a certificate of non-foreign
status from each of the Seller Parties (and Affiliates, as applicable) in
compliance with Treasury Regulations Section 1.1445-2, (x) specific assignment
and assumption agreements duly executed by the appropriate Seller Party or their
Affiliates (as applicable) relating to any Contracts included as Purchased
Assets that the Buyer or the Seller Parties have determined to be reasonably
necessary to assign such Contracts to the Buyer and for the Buyer to assume the
Assumed Liabilities thereunder (if any), in form and substance reasonably
acceptable to the Buyer, (xi) satisfactory evidence that any Encumbrances to be
discharged prior to or simultaneous with Closing have been discharged, and (xii)
such other documents and instruments as the Buyer has determined to be
reasonably necessary to consummate the transactions contemplated hereby.

 

 
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(b)     At the Closing, the Buyer shall deliver to the Seller Parties (i) the
Closing Date Payment, (ii) the Bill of Sale and Assignment and Assumption
Agreement, (iii) the Transition Services Agreement, (iv) all of the documents
and instruments required to be delivered by the Buyer pursuant to Article VII,
(v) specific assignment and assumption agreements duly executed by the Buyer
relating to any Contracts included as Purchased Assets that the Buyer or the
Seller Parties have determined to be reasonably necessary to assign such
Contracts to the Buyer and for the Buyer to assume the Assumed Liabilities
thereunder (if any), and (vi) such other documents and instruments as the Seller
Parties have determined to be reasonably necessary to consummate the
transactions contemplated hereby.

 

Section 2.9.     Further Assurances.

 

(a)     From time to time following the Closing, the appropriate Seller Party
shall execute and deliver, or cause to be executed and delivered, to the Buyer
such other instruments of conveyance and transfer as the Buyer may reasonably
request or as may be otherwise necessary to carry out the provisions of this
Agreement and the transactions contemplated hereby, to effectively convey and
transfer to, and vest in, the Buyer and put the Buyer in possession of, any part
of the Purchased Assets, and, in the case of licenses, certificates, approvals,
authorizations, agreements, contracts, leases, easements and other commitments
included in the Purchased Assets which cannot be transferred or assigned
effectively without the consent of third parties, which consent has not been
obtained prior to the Closing, to reasonably cooperate with the Buyer at its
reasonable request in endeavoring to obtain such consent.

 

(b)     Without limiting Sections 5.3(c), to the extent that any Assumed
Contract cannot be assigned without consent and such consent is not obtained
prior to the Closing, the Seller Parties shall use all commercially reasonable
efforts to provide the Buyer the benefits of any such Contract and the Buyer
shall perform or discharge on behalf of the applicable Seller Party the
obligations and liabilities under such agreement that constitute Assumed
Liabilities, if any. In addition to the Buyer’s obligation pursuant to the
foregoing sentence, as to any Assumed Contract included as a Purchased Asset
that is not effectively assigned to the Buyer as of the Closing Date but is
thereafter effectively assigned to the Buyer, the Buyer shall, from and after
the effective date of such assignment, assume, and shall thereafter pay, perform
and discharge as and when due, all Assumed Liabilities of any Seller Party or
its Affiliates, as applicable, arising under such Assumed Contract.

 

(c)     From time to time following the Closing, the Buyer shall execute and
deliver, or cause to be executed and delivered, to the Seller Parties such other
undertakings and assumptions as the Seller Parties may reasonably request or as
may be otherwise necessary to effectively evidence the Buyer’s assumption of and
obligation to pay, perform and discharge the Assumed Liabilities.

 

 

 
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Section 2.10.     Purchase Price Adjustment. Promptly (but not later than five
(5) Business Days) after the determination of the Purchase Price pursuant to
Section 2.7 that is final and binding as set forth herein:

 

(i)     if the Purchase Price as finally determined pursuant to Section 2.7
exceeds the Estimated Purchase Price, the Buyer shall pay to the Seller Parties,
by wire transfer of immediately available funds to such bank accounts of the
Seller Parties as the Seller Parties shall designate in writing to the Buyer,
the amount by which the Purchase Price exceeds the Estimated Purchase Price; or

 

(ii)     if the Purchase Price as finally determined pursuant to Section 2.7 is
less than the Estimated Purchase Price, the Seller Parties shall pay to the
Buyer, by wire transfer of immediately available funds to such bank accounts of
the Buyer as the Buyer shall designate in writing to the Seller Parties, the
amount by which the Estimated Purchase Price exceeds the Purchase Price.

 

Section 2.11.     Allocation of Purchase Price. The Purchase Price (and any
adjustments thereto) and any Assumed Liabilities shall be allocated among the
Purchased Assets in accordance with the provisions of Section 1060 of the Code
(“Allocation”). Within one-hundred eighty (180) days after the Closing, the
Seller Parties shall prepare the Allocation and submit such Allocation to the
Buyer for their review. The Buyer shall provide the Seller Parties with any
comments to such allocation within thirty (30) Business Days after the date of
receipt by the Buyer. The Buyer and the Seller Parties agree to act in
accordance with the Allocation of the Purchase Price established pursuant to
this Section 2.11 in the preparation and filing of all Tax Returns, including
Form 8594, and shall take no position inconsistent with such Allocation in any
proceeding before any Governmental Body or otherwise, provided, however, if the
parties are unable to mutually agree to such Allocation then the parties shall
have no further obligation under this Section 2.11, and each party shall make
its own determination of such allocation for financial and tax reporting
purposes, which determination, for the avoidance of doubt, shall not be binding
on the other party.

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES

 

As an inducement to the Buyer to enter into this Agreement and to consummate the
transactions contemplated hereby, the Seller Parties jointly and severally
represent and warrant to the Buyer as follows as of the date hereof and as of
the Closing Date (except to the extent expressly made as of specific date or
time, and then as of such specified date or time):

 

Section 3.1.     Organization and Qualification.

 

(a)     Each of the Seller Parties is organized, validly existing and in good
standing under the laws of its state of incorporation. Each of the Seller
Parties has the requisite organizational power and authority to operate the
Station as now operated by it, to use the Purchased Assets as now used by it and
to carry on the Business as now conducted by it.

 

 

 
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(b)     Each of the Seller Parties is duly qualified or licensed as a foreign
corporation to do business, and is in good standing, in each jurisdiction where
the ownership or operation of the Purchased Assets or the conduct of the
Business makes such qualification or licensing necessary, except for any such
failures to be so qualified or licensed and in good standing that, individually
or in the aggregate, have not had and would not reasonably be expected to have a
Material Adverse Effect.

 

Section 3.2.     Authority of the Seller Parties; No Conflict; Required Filings
and Consents.

 

(a)     Each of the Seller Parties has the requisite organizational power and
authority to execute and deliver this Agreement and the Ancillary Agreements to
be executed and delivered by it pursuant hereto, to consummate the transactions
contemplated hereby and thereby and to comply with the terms, conditions and
provisions hereof and thereof.

 

(b)     The execution, delivery and performance of this Agreement and the
Ancillary Agreements by each of the Seller Parties (to the extent a party
thereto) have been duly authorized and approved by all necessary organizational
and shareholder or equity owner action on the part of the Seller Parties or
their Affiliates and do not require any further authorization or consent on the
part of the Seller Parties or their Affiliates. This Agreement is, and each
other Ancillary Agreement when executed and delivered by each of the Seller
Parties party thereto or their Affiliates, as applicable, will be, a legal,
valid and binding agreement of such Seller Party or its Affiliates party
thereto, as applicable, enforceable in accordance with its respective terms,
except in each case as such enforceability may be limited by applicable
bankruptcy, moratorium, insolvency, reorganization or other similar laws
affecting or limiting the enforcement of creditors’ rights generally and except
as such enforceability is subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

 

(c)     Except for the FCC Consent, the DOJ Consent and as set forth in Schedule
3.2, none of the execution, delivery and performance by the Seller Parties of
this Agreement or by any of the Seller Parties or any of their Affiliates, as
applicable, of the Ancillary Agreements to which it is a party, the consummation
by the Seller Parties or their Affiliates, as applicable, of the transactions
contemplated hereby or thereby or compliance by the Seller Parties or their
Affiliates, as applicable, with or fulfillment by the Seller Parties of the
terms, conditions and provisions hereof or thereof will:

 

(i)     conflict with, result in a breach of the terms, conditions or provisions
of, or constitute a default (or an event that, with notice or lapse of time or
both, would become a default), an event of default or an event creating rights
of acceleration, termination, cancellation, revocation, payment or a loss of
rights under, or result in the creation or imposition of any Encumbrance upon
any of the Purchased Assets under, (A) the certificate of incorporation, bylaws
or other organizational documents of the Seller Parties, (B) any Station
Agreement in any material respect, (C) any material Governmental Permit, (D) any
material judgment, Order, award or decree to which such Person is a party or any
of the Purchased Assets is subject or by which such Person is bound, or (E) any
material indenture, note, mortgage, lease, guaranty or material Contract to
which any of the Seller Parties and any of their Affiliates is a party;

 

 

 
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(ii)     conflict with or violate any Law applicable to the Seller Parties, the
Business or any of the Purchased Assets or by which the Seller Parties, the
Business or any of the Purchased Assets may be bound or affected, except, in any
case, as would not, individually or in the aggregate, be reasonably likely to
have a Material Adverse Effect; or

 

(iii)     require the approval, consent, authorization or act of, or the making
by any Seller Party, or any of their Affiliates of any declaration, notice,
filing or registration with, any third Person or any foreign, federal, state or
local court, governmental or regulatory authority or body, except for any
approval by the DOJ as required by the proposed final judgment entered in
connection with or as a result of the transactions contemplated by the Merger
(the “DOJ Final Judgment”), except, in any case, as would not, individually or
in the aggregate, be reasonably likely to have a Material Adverse Effect.

 

Section 3.3.     Financial Statements. Schedule 3.3 contains (a) the unaudited
balance sheets of the Business as of December 31, 2013 and December 31, 2012,
respectively, and the related statements of income for the years then ended (the
“Financial Statements”) and (b) the unaudited balance sheet (the “Balance
Sheet”) of the Business as of June 30, 2014 (the “Balance Sheet Date”) and the
related statement of income for the six months ended June 30, 2014 (the “Income
Statement”). Each of the Financial Statements, the Balance Sheet and Income
Statement (i) are correct and complete in all material respects and have been
prepared in accordance with the books and records of the Seller Parties and
their Affiliates pertaining to the Business, (ii) present fairly, in all
material respects, the financial position and results of operations of the
Business as of their respective dates and for the respective periods covered
thereby, and (iii) except as set forth in Schedule 3.3, have been prepared in
conformity with GAAP applied on a consistent basis throughout the periods
involved. The books of account and financial records of the Seller Parties and
their Affiliates pertaining to the Business have been maintained in accordance
with customary business practice. Except as set forth on Schedule 3.3, none of
the Seller Parties and their Affiliates has, between December 31, 2012 and the
date of this Agreement, made or adopted any material change in its accounting
methods, practices or policies in effect on December 31, 2012.

 

Section 3.4.     Operations Since Balance Sheet Date.

 

(a)     Except as set forth in Schedule 3.4(a), from the Balance Sheet Date,
there have been no events, changes or occurrences or state of facts, including
any change in the financial condition or the results of operations of the
Business, which, individually or in the aggregate, have had or would be
reasonably likely to have a Material Adverse Effect.

 

(b)     Except as set forth in Schedule 3.4(b), from the Balance Sheet Date
through the date of this Agreement, the Seller Parties and their Affiliates have
operated the Business in the ordinary course of the Business consistent with
past practice other than in connection with the Mergers and the process relating
to the sale of the Business.

 

 

 
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Section 3.5.     No Undisclosed Liabilities. Except as set forth in Schedule
3.5, the Seller Parties and their Affiliates have no liabilities with respect to
the Business (including unasserted claims, whether known or unknown), whether
absolute, contingent, accrued or otherwise, except for liabilities which are (a)
reflected or reserved for on the Balance Sheet, (b)  liabilities incurred in the
ordinary course of the Business consistent with past practice since the Balance
Sheet Date, or (c) liabilities to be performed in the ordinary course of the
Business consistent with past practice pursuant to the Assumed Contracts.

 

Section 3.6.     Taxes.

 

(a)     Each of the Seller Parties and/or its Affiliates, as applicable, has
filed with the proper Governmental Body all material Tax Returns with respect to
the Business and the Purchased Assets required to be filed prior to the date
hereof and all such Tax Returns were true, correct and complete in all material
respects. Each of the Seller Parties and/or its Affiliates, as applicable, has
paid or caused to be paid all material Taxes (whether or not reflected on any
such Tax Returns) that are due and owing with respect to the Purchased Assets
and the Business, or has set aside on the Balance Sheet adequate reserves
(segregated to the extent required by GAAP). No deficiencies for material Taxes
with respect to the Purchased Assets and the Business have been claimed,
proposed or assessed in writing by any Governmental Body for which the Seller
Parties or their Affiliates may have any liability or that may attach to the
Purchased Assets. Each of the Seller Parties and/or its Affiliates, as
applicable, is in compliance in all material respects with the provisions of the
Code relating to the withholding and payment of Taxes with respect to the
Business and the Purchased Assets and has, within the time and in the manner
prescribed by Law, withheld and paid over to the proper Governmental Body all
Taxes required to be have been withheld and paid in connection with amounts paid
or owing to any employee, independent contractor, creditor, or other third party
with respect to the Business. There are no liens for Taxes on any of the
Purchased Assets other than Permitted Encumbrances. To the Knowledge of the
Seller Parties, (i) no Tax Return relating to the Business or the Purchased
Assets is currently under audit or examination by any Governmental Body, and
(ii) there are no suits, actions, proceedings or investigations pending with
respect to any material Taxes relating to the Business or the Purchased Assets.

 

(b)     In each case as it pertains to the Purchased Assets and the Business,
none of the Seller Parties or their Affiliates (i) has received any written
notice that it is being audited by any Taxing authority which audit has not yet
been completed; (ii) has granted any presently operative waiver of any statute
of limitations with respect to, or any extension of a period for the assessment
of, any Tax other than as the result of extending the due date of a Tax Return;
and (iii) has availed itself of any Tax amnesty or similar relief in any Taxing
jurisdiction.

 

(c)     As it pertains to the Purchased Assets and the Business, none of the
Seller Parties or their Affiliates is bound by any Tax sharing agreement or
similar arrangements (including any indemnity arrangements), other than
Contracts entered into in the ordinary course of the Business the principal
subject of which is not Taxes.

 

(d)     Each of the Seller Parties and its Affiliates who own any Purchased
Assets is a “United States person” within the meaning of Section 7701 of the
Code.

 

 

 
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(e)     None of the Seller Parties and its Affiliates is, or has been, a party
to, or a promoter of, a “reportable transaction” within the meaning of Section
6707(c)(1) of the Code and Treasury Regulations Section 1.6011-4(b) with respect
to the Business or the Purchased Assets.

 

(f)     No written claim has ever been made by a Governmental Body in a
jurisdiction where any of the Seller Parties or their Affiliates has not filed a
Tax Return with respect to the Purchased Assets or the Business that any of the
Seller Parties or their Affiliates is or may be subject to taxation by that
jurisdiction, which claim has not been fully paid or settled.

 

Section 3.7.     Sufficiency of Assets; Title to Purchased Assets.

 

(a)     Except for the Excluded Assets, the Purchased Assets (i) constitute all
the assets and properties whether tangible or intangible, whether personal, real
or mixed, wherever located, that are used or held for use by the Seller Parties
and their Affiliates primarily in the operation of the Station and (ii) with
respect to the Tangible Personal Property, Real Property, Purchased Intellectual
Property, Seller FCC Authorizations and Assumed Contracts, are sufficient to
conduct the operation of the Station in the manner in all material respects
which the Station is conducted on the date hereof except for matters of the
nature covered by the Transition Services Agreement. Except as set forth on
Schedule 3.7 or as provided in the Transition Services Agreement or in any
Multi-Station Contract to the extent the benefits thereunder are not made
available to Buyer after Closing, none of the Excluded Assets is necessary to
operate the Business in substantially the same manner as such operations have
heretofore been conducted.

 

(b)     The Seller Parties have good and valid title to or a valid leasehold
interest in all of the Purchased Assets, free and clear of any Encumbrance,
other than Permitted Encumbrances (it being understood that until the
consummation of the Mergers only LIN TV holds such title).

  

Section 3.8.     Governmental Permits; FCC Matters.

 

(a)     As of the date of this Agreement, the Seller Parties or their Affiliates
own, hold or possess all material Governmental Permits that are reasonably
necessary to entitle them to own or lease, operate and use the assets of the
Station and to carry on and conduct the Business substantially as currently
conducted. Schedule 3.8(a) sets forth a list as of the date of this Agreement of
each of the Seller FCC Authorizations and other material Governmental Permits,
held by the Seller Parties and pending applications filed by the Seller Parties
with the FCC with respect to the Station. The Seller FCC Authorizations
constitute all Governmental Permits issued by the FCC to the Seller Parties and
their Affiliates in respect of the Station and held by the Seller Parties and
their Affiliates as of the date of this Agreement.

 

(b)     Each Seller Party and its Affiliates has fulfilled and performed its
obligations under each of the Governmental Permits except for noncompliance
that, individually or in the aggregate, has not had and would not be reasonably
likely to have a Material Adverse Effect. Each of the Seller FCC Authorization
and the material Governmental Permits is valid, subsisting and in full force and
effect and has not been revoked, suspended, canceled, rescinded or terminated.

 

 

 
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(c)     The Station is being operated in accordance with the Seller FCC
Authorizations and in compliance in all material respects with the
Communications Act and all other Laws applicable to the Station (including
Federal Aviation Administration Laws), except for such noncompliance that,
individually or in the aggregate, has not had and would not be reasonably likely
to have a Material Adverse Effect. Except as disclosed in Schedule 3.8(c), there
is not (i) pending, or, to the Knowledge of the Seller Parties, threatened, any
action or legal proceeding, other than actions or proceedings affecting
broadcast television stations generally, by or before the FCC to revoke,
suspend, cancel, rescind, terminate, materially adversely modify or refuse to
renew in the ordinary course any Seller FCC Authorization (other than, in the
case of modifications, proceedings to amend the FCC rules of general
applicability), (ii) issued or outstanding, by or before the FCC, any (A) order
to show cause, (B) notice of violation, (C) notice of apparent liability or (D)
order of forfeiture, in each case, against the Station, or any Seller Party or
any of its Affiliates with respect to the Station that has resulted or would
reasonably be expected to result in any action described in the foregoing clause
(i) with respect to such Seller FCC Authorizations, or (iii) pending or, to the
Knowledge of the Seller Parties, threatened any petition, investigation,
inquiry, complaint, notice of violation, notice of apparent liability, or notice
of forfeiture against the Station or against the Seller Parties or their
Affiliates with respect to the Station, and, to the Knowledge of the Seller
Parties, there are no facts that would reasonably be expected to result in any
of the above. The Seller FCC Authorizations have been issued by the FCC for full
terms customarily issued by the FCC for each class of Station, and the Seller
FCC Authorizations are not subject to any restriction or condition except for
those restrictions or conditions appearing on the face of the Seller FCC
Authorizations and conditions applicable to broadcast licenses generally or
otherwise disclosed in Schedule 3.8(a). Except as set forth on Schedule 3.8(a),
the Seller Parties have completed the construction of all facilities or changes
authorized by any of the Seller FCC Authorizations or construction permits
issued by the FCC to modify the Seller FCC Authorizations. Other than with
respect to the FCC or the Federal Aviation Administration, this Section 3.8 does
not relate to Governmental Permits for environmental, health and safety matters
which are the subject solely of Section 3.21.

 

(d)     All material returns, reports, and statements which the Station is
currently required to have filed with the FCC, with any other Governmental Body,
or in the Station’s public inspection file, have been timely filed, all FCC
regulatory fees due and payable from each Seller Party or its Affiliates with
respect to the Station have been paid, and all material reporting requirements
of the FCC and other Governmental Bodies having jurisdiction over the Station
have been complied with, in each case, in all material respects.

 

(e)     Except for the Mergers or as otherwise disclosed in Schedule 3.8(c), to
the Knowledge of the Seller Parties, no fact or circumstance exists relating to
Seller Parties or the Station that could reasonably be expected to (i) prevent
or delay the FCC’s grant of the FCC Consent, (ii) otherwise disqualify the
Licensee as the licensee, owner, or operator of the Stations, or (iii) cause the
FCC to impose a material condition or conditions on its granting of the FCC
Consent.

 

 

 
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Section 3.9.     Real Property; Real Property Leases.

 

(a)     Schedule 3.9(a) contains a brief description of all Owned Real Property
as of the date of this Agreement. The Seller Parties are the sole owners of, and
have, and immediately prior to the Closing will have, good, valid and marketable
title (free and clear of any Encumbrances other than Permitted Encumbrances) to
all Owned Real Property (it being understood that until the consummation of the
Mergers only LIN TV holds such title).

 

(b)     The Seller Parties have delivered or otherwise made available to the
Buyer true, correct and complete copies of all deeds, title insurance reports
and policies, exception documents, Real Property Leases and related documents
and information and surveys for the Owned Real Property (collectively, the “Fee
Title Documents”) in Seller Parties’ possession. To the Knowledge of the Seller
Parties, no party to any reciprocal easement agreement or other Fee Title
Document affecting or relating to the Owned Real Property is in material default
under any of the terms and conditions of any such reciprocal easement agreement
or other Fee Title Document.

 

(c)     Schedule 3.9(c) sets forth a list of each Real Property Lease under
which any Seller Party or any of its Affiliates is a lessee or sublessee of, or
occupies or uses, any Leased Real Property (such Leased Real Property together
with the Owned Real Property, the “Real Property”) that is in effect as of the
date of this Agreement, and identifies the applicable Real Property Lease, and
the lessor, sublessor, or licensor as the case may be, thereof. Except as
permitted in any Real Property Lease, to the Knowledge of the Seller Parties,
none of the Seller Parties or their Affiliates, nor any other Person has granted
any oral or written right to any Person other than the Seller Parties or their
Affiliates to lease, sublease, license or otherwise use or occupy any of the
Leased Real Property beyond the end of the applicable periods of the applicable
Real Property Lease. The Seller Parties have delivered or otherwise made
available to the Buyer true, correct and complete copies of (i) the Real
Property Leases (and all amendments and modifications thereto), and (ii) all
title insurance reports and policies, underlying title exception documents,
surveys, related documents and information pertaining to such Leased Real
Property in the Seller Parties’ possession.

 

(d)     A Seller Party or one of its Affiliates has a good, valid, existing and
enforceable leasehold interest in, sub leasehold interest in, or other occupancy
right with respect to, all Leased Real Property, in each case free and clear of
any Encumbrances other than Permitted Encumbrances (it being understood that
until the consummation of the Mergers only LIN TV holds such interest).

 

(e)     Neither the whole nor any part of the Owned Real Property nor, to the
Knowledge of the Seller Parties, any Leased Real Property is subject to (i) any
pending or, to the Knowledge of the Seller Parties, threatened suit for
condemnation or other taking by any public authority, or (ii) any private
restrictive covenant or governmental use restriction (including zoning) that
prohibits or materially interferes with the current use of the Real Property,
and none of the Seller Parties or their Affiliates has received any written
notice of the intention of any Governmental Body or other Person to take or use
all or any part thereof.

 

 

 
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(f)     There are no outstanding options or rights of first refusal or other
contractual rights to purchase all or a portion of the Owned Real Property. All
buildings, structures, fixtures, building systems and equipment, and all
components which are part of the Owned Real Property and, to the Knowledge of
the Seller Parties, the Leased Real Property are in all material respects in
good operating condition, subject to normal wear, and are in all material
respects sufficient for the operation of the Business as presently conducted. No
portion of any facility, building, improvement or other structure located on any
of the Owned Real Property or, to the Knowledge of the Seller Parties, the
Leased Real Property has suffered any material damage by fire or other casualty
within the past two (2) years which has not been substantially repaired or
restored.

 

(g)     Schedule 3.9(g) contains a list, as of the date hereof, of all Real
Property Leases pursuant to which any Seller Party or any of its Affiliates
leases, subleases, licenses, sublicenses or otherwise grants a right of use or
occupancy to a third party with respect to all or any portion of any Real
Property. Except for the foregoing, none of the Seller Parties and their
Affiliates has assigned, pledged, leased, subleased, licensed, transferred,
conveyed, mortgaged, deeded in trust or otherwise encumbered in any way any
interest in the Real Property or the leasehold, subleasehold, license or
sublicense created by any Real Property Lease.

 

(h)     The Real Property constitutes all interests in real property which are
necessary for continued operation of the Station as currently operated. The
Seller Parties own, lease or have the legal right to use in the ordinary course
of business all easements, rights of entry and rights-of-way which are material
to the Business. All of the towers, guy anchors, guy wires, cables, driveways,
parking lots, ground systems, transmitting equipment, buildings and other
buildings, fixtures, and improvements, relating to the Station’s operations are
located entirely on and wholly within the lot limits and metes and bounds of the
Real Property, comply in all material respects with all set-back laws and
requirements, and comply in all material respects with all license and permit
requirements.

 

(i)     To the Knowledge of the Seller Parties, all material improvements on the
Real Property conform in all material respects to applicable Laws and all use
restrictions, and all Real Property is zoned for the various purposes for which
the Real Property and any improvements thereon are presently being used. Within
the past two (2) years, none of the Seller Parties and their Affiliates has
received any written notice of any material violation of any material Law
affecting the Real Property or the Seller Parties’ and their Affiliates’ use
thereof. All material Governmental Permits required for the occupancy and
operation of the Real Property as presently being used have been obtained and
are in full force and effect and, none of the Seller Parties and their
Affiliates has received any written notice of violation in connection with such
Permits. To the Knowledge of the Seller Parties, there are no studies or reports
which indicate any material defects in the design or construction of any of the
improvements located on any of the Real Property.

 

Section 3.10.     Intellectual Property.

 

(a)     Schedule 3.10(a) contains a true and complete list as of the date of
this Agreement of all patents and patent applications, registered and material
unregistered Trademarks and registered copyrights, in each case, that are
included in the Purchased Intellectual Property, including any pending
applications to register any of the foregoing, identifying for each whether it
is owned by or exclusively licensed to the Seller Parties. The Seller Parties
exclusively own, free and clear of any and all Encumbrances other than Permitted
Encumbrances, all Purchased Intellectual Property identified on Schedule 3.10(a)
and all other Purchased Intellectual Property, except for Purchased Intellectual
Property that is licensed to the Seller Parties by a third party licensor
pursuant to a written license agreement that remains in effect.

 

 

 
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(b)     Except as would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect, to the Knowledge of the Seller
Parties, the Business is not infringing, misappropriating or otherwise violating
any Intellectual Property owned by any third party. To the Knowledge of the
Seller Parties, no third party is materially misappropriating or infringing any
Purchased Intellectual Property. The Buyer acknowledges that the representations
and warranties set forth in this Section 3.10 are the only representations and
warranties the Seller Parties make in this Agreement with respect to any
activity that constitutes, or otherwise with respect to, infringement,
misappropriation or other violation of Intellectual Property.

 

(c)     There are no actions, suits or proceedings by or before any court or any
Governmental Body which are pending or, to the Knowledge of Seller Parties,
threatened regarding or disputing the ownership, registrability or
enforceability, or use by the Seller Parties or any of their Affiliates, of any
Purchased Intellectual Property, other than the review of pending patent and
trademark applications by applicable Governmental Bodies, nor to the Knowledge
of the Seller Parties is there a reasonable basis for any claim that it does not
so own any of such Purchased Intellectual Property except for Purchased
Intellectual Property that is licensed to the Seller Parties by a third party
licensor pursuant to a written license agreement that remains in effect. Neither
Seller Party nor any of its Affiliates is a party to any outstanding Order that
restricts, in a manner material to the Business, the use or ownership of any
Purchased Intellectual Property.

 

(d)     The Seller Parties have taken all reasonable steps in accordance with
standard industry practices to protect their rights in the Purchased
Intellectual Property and at all times have maintained the confidentiality of
all information that constitutes or constituted a trade secret included therein.

 

Section 3.11.     Tangible Personal Property.

 

(a)     The Seller Parties and their Affiliates have good and valid title or a
valid right to use all of the material Tangible Personal Property included in
the Purchased Assets free and clear of all Encumbrances, except for Permitted
Encumbrances.

 

(b)     All of the material Tangible Personal Property has been maintained in
all material respects in accordance with past practice and generally accepted
industry practice. Each material item of the Tangible Personal Property is in
all material respects in good operating condition and repair, ordinary wear and
tear excepted, and is adequate for the uses to which it is being put. All leased
material Tangible Personal Property is in all material respects in the condition
required of such property by the terms of the lease applicable thereto.

 

 

 
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Section 3.12.     Employees. Schedule 3.12 contains: (a) a complete and accurate
list of all full-time, part-time and per diem employees of the Seller Parties
and their Affiliates as of the date of this Agreement whose employment relates
primarily to the Business, including each of their job titles, dates of hire,
rates of pay and other compensation entitlements, and whether they are Active or
Inactive Employees; and (b) the current rate of annual base salary provided by
the Seller Parties and their Affiliates to such employees as of the date hereof.

 

Section 3.13.     Employee Relations.

 

(a)     None of the Seller Parties or their Affiliates is a party to any labor
or union agreement or collective bargaining agreement in respect of the Station
or covering any Employee as of the date hereof.

 

(b)     Except as disclosed on Schedule 3.13, as of the date of this Agreement,
no unfair labor practice charge against any of the Seller Parties or any of its
Affiliates in respect of the Station is pending or, to the Knowledge of the
Seller Parties, threatened before the National Labor Relations Board, any state
labor relations board or any court or tribunal. The Seller Parties are and
during the past five years have been in compliance in all material respects with
all applicable Laws respecting employment, including discrimination or
harassment in employment, terms and conditions of employment, termination of
employment, wages, overtime classification, hours, occupational safety and
health, employee whistle-blowing, immigration, employee privacy, employment
practices and classification of employees, consultants and independent
contractors, in connection with the Business.

 

(c)     As of the date of this Agreement there are no, and since January 1,
2013, there have not been any, organizing activities, lockouts, strikes,
slowdowns or other work stoppages or material labor disputes pending or, to the
Knowledge of the Seller Parties, threatened in respect of the Station.

 

Section 3.14.     Contracts. Schedule 3.14 sets forth as the date hereof a list
of the following Contracts primarily relating to the Business or the Purchased
Assets:

 

(a)     any Contract for the purchase, sale, license or lease of assets used or
to be used primarily in the Business, or for the provision of services primarily
used in the Business, with a value in excess of $25,000;

 

(b)     any programming Contract or film or program license Contract for rights
to broadcast television programs or shows as part of the Station’s programming;

 

(c)     any retransmission Contract with any MVPDs with more than 1,000 paid
subscribers with respect to the Station;

 

(d)     any Contract that is a “local marketing agreement” or time brokerage
agreement, joint sales agreement, shared services agreement, management services
agreement, local news sharing agreement or similar Contract;

 

(e)     any partnership, shareholder, joint venture, or other similar Contract;

 

 

 
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(f)     any affiliation Contract with a national television network;

 

(g)     any Contract for capital expenditures in excess of $10,000 for any
single item and $25,000 in the aggregate;

 

(h)     any Employment Agreement or other Contract with any individual Employee,
independent contractor or consultant;

 

(i)     any Contract pursuant to which a Seller Party is the lessee or lessor
of, or holds, uses, or makes available for use to any Person, (A) any real
property or (B) any Tangible Personal Property and, in the case of clause (B),
that involves an aggregate future or potential liability or receivable, as the
case may be, in excess of $25,000;

 

(j)     any Contract relating to or evidencing Indebtedness of the Business or
any of the Seller Parties or their Affiliates in connection with the Business,
including mortgages, other grants of security interests, guarantees or notes in
excess of $25,000;

 

(k)     any Contract with any Governmental Body;

 

(l)     any Contract with any Related Party of a Seller Party;

 

(m)     any Contract that limits, or purports to limit, the ability of a Seller
Party or the Business to compete in any line of business or with any Person or
in any geographic area or during any period of time, or that restricts the right
of a Seller Party or the Business to sell to or purchase from any Person or to
hire any Person, or that grants the other party or any third person “most
favored nation” status or any type of special discount rights;

 

(n)     any Contract related in whole or in part to any Purchased Intellectual
Property other than licenses of off-the-shelf software with a replacement value
or aggregate annual license and maintenance fees of less than $20,000;

 

(o)     any Contract (other than any Contract of the type described in clauses
(a) through (n) above) that primarily relates to the Business that is not
terminable by a Seller Party without penalty on ninety (90) days’ notice or less
and which is reasonably expected to involve the payment by the Seller Parties
after the date hereof of more than $100,000 per annum; and

 

(p)     any other Contract that is material to the Business, taken as a whole.

 

Schedule 3.14 also indicates (i) whether each Contract listed therein is to be
deemed an “Assumed Contract” and (ii) for any Assumed Contract, whether the
consent of a third Person is required in order to assign the Contract as
contemplated by this Agreement and the Ancillary Agreements.

 

Section 3.15.     Status of Contracts. Except as set forth in Schedule 3.15 or
in any other Schedule hereto, each of the Contracts listed in Schedule 3.14 and
indicated to be an “Assumed Contract” (collectively, the “Station Agreements”)
is a legal, valid and binding obligation of a Seller Party and, to the Knowledge
of the Seller Parties, the other parties thereto, and is in full force and
effect (in each case, subject to applicable bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors’
rights generally and except as such enforceability is subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law)). The Seller Parties and their Affiliates are
not in breach of, or default under, any Station Agreement and, to the Knowledge
of the Seller Parties, no other party to any Station Agreement is in breach of,
or default under, any Station Agreement, and (ii) to the Knowledge of the Seller
Parties, no event has occurred which would result in a breach of, or default
under, any Station Agreement (in each case, with or without notice or lapse of
time or both). True and complete copies of each of the Station Agreements,
together with all amendments thereto, have heretofore been made available to the
Buyer by the Seller Parties.

 

 

 
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Section 3.16.     No Violation, Litigation or Regulatory Action. Except as set
forth in Schedule 3.16 and 3.8(c):

 

(a)     Each Seller Party is in compliance in all material respects with all
Laws which are applicable to the Purchased Assets, the Station, the Business or
the Assumed Liabilities;

 

(b)     Since December 31, 2012 and through the date of this Agreement, no
Seller Party has received any written notice from a Governmental Body of a
material violation of any applicable Laws.

 

(c)     As of the date of this Agreement, except for threatened actions, suits
or proceedings in connection with the transactions contemplated by the Mergers
and for Orders relating to conditions to be approved by Governmental Bodies of
the Mergers, there are no Proceedings which are pending or, to the Knowledge of
the Seller Parties, threatened against any Seller Party or any of their
Affiliates in respect of the Purchased Assets, the Assumed Liabilities, the
Station or the Business or the ownership or operation thereof.

 

Section 3.17.     Insurance. A Seller Party or one of its Affiliates currently
maintains, in respect of the Purchased Assets, the Stations and the Business,
policies of fire and extended coverage and casualty, liability and other forms
of insurance in such amounts and against such risks and losses as are in the
judgment of the Seller Parties prudent for the Business. The Seller Parties have
not received notice of, nor to the Knowledge of the Seller Parties is there
threatened, any cancellation, termination, reduction of coverage or material
premium increases with respect to any such policy. Except as set forth in
Schedule 3.17 with respect to the Business, there are no outstanding claims
under any insurance policy or default with respect to provisions in any such
policy which claim or default, individually or in the aggregate, would be
reasonably likely to have a Material Adverse Effect.    

 

Section 3.18.     Employee Plans; ERISA.

 

(a)     Schedule 3.18 sets forth a list of each Employee Plan in effect as of
the date of this Agreement. A true and correct copy of each such Employee Plan,
including all amendments thereto, has been delivered to the Buyer.

 

(b)     “ERISA Affiliate” means with respect to any entity (i) a member of any
“controlled group” (as defined in section 414(b) of the Code) of which that
entity is also a member, (ii) a trade or business, whether or not incorporated,
under common control (within the meaning of section 414(c) of the Code) with
that entity, or (iii) a member of an affiliated service group (within the
meaning of section 414(m) of the Code) of which that entity is also a member.
“Compensation Arrangement” means any Employment Agreement, bonus, deferred
compensation, incentive compensation, stock purchase, stock option, severance or
termination pay, or profit sharing plan, program, agreement, or arrangement for
the benefit of any current or former Employee, director, or independent
contractor of the Station.

 

 

 
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(c)     Each Employee Plan has been operated and administered in material
compliance and currently is in material compliance, both as to form and
operation, with its terms and all applicable Laws, including the requirements of
ERISA and the Code, except where noncompliance would not result in a liability
to Buyer. Each Employee Plan intended to be “qualified” within the meaning of
Section 401(a) of the Code has received a favorable determination letter, or
with respect to a prototype plan, can rely on an opinion letter from the
Internal Revenue Service to the prototype plan sponsor, to the effect that such
qualified plan is so qualified and that the plan and the trust related thereto
are exempt from federal income taxes under Sections 401(a) and 501(a),
respectively, of the Code, and to the Knowledge of the Seller nothing has
occurred subsequent to the date of such favorable determination letter that
could adversely affect the qualified status of any such plan. There have been no
statements or communications made or materials provided to any employee or
former employee of the Seller Parties or their Affiliates that is, was or could
be construed as a contract or promise by the Buyer to provide for any pension,
welfare, or other compensation or benefit to any such employee or former
employee, whether before or after retirement.

 

(d)     No Employee Plan: (i) is subject to Section 412 of the Code, Section 302
of ERISA or Title IV of ERISA, (ii) is a “multiemployer plan” (within the
meaning of Section 3(37) or Section 4001(a)(3) of ERISA) or (iii) provides for
post-termination welfare benefits (other than as required by Code Section 4980B
or any state law counterpart). None of the Seller Parties or any of its
Affiliates or any ERISA Affiliate of the Seller Parties or their Affiliates has
any liability (contingent or otherwise) relating to the withdrawal or partial
withdrawal from a multiemployer plan within the meaning of Sections 4201 and
4204 of ERISA.

 

(e)     Neither the execution and delivery of this Agreement nor the
transactions contemplated by this Agreement (either solely as a result thereof
or as a result of such transaction in conjunction with another event) could (i)
result in any payment (including severance, unemployment, compensation, golden
parachute, “excess parachute” (within the meaning of Section 280G of the Code),
bonus or otherwise) becoming due to any Transferred Employee; (ii) increase any
compensation or benefits otherwise payable to any Transferred Employee; (iii)
result in the acceleration of the time of payment or vesting of any compensation
or benefits; or (iv) result in any acceleration of funding of any compensation
or benefit.

 

(f)     Each Compensation Arrangement and all grants, awards, or benefits
thereunder or under any Employee Plan that is subject to Section 409A have, in
form and operation, met the requirements of Section 409A(a)(2), Section
409A(a)(3) and Section 409A(a)(4) of the Code.

 

 

 
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Section 3.19.     Environmental Protection.

 

(a)     Except as set forth in Schedule 3.19:

 

(i)     The Business and each Seller Party and its Affiliates in respect of the
Business are in material compliance with all Environmental Laws;

 

(ii)     Each Seller Party and its Affiliates has, in respect of the Business,
obtained all material Governmental Permits required under Environmental Law
necessary for its operation. Each Seller Party and its Affiliates is in
compliance in all material respects with all terms and conditions of such
Governmental Permits;

 

(iii)     As of the date of this Agreement, none of the Seller Parties or any of
its Affiliates, with respect to the Business, or the Station or the Real
Property is the subject of any pending or, to the Knowledge of the Seller
Parties, threatened action, claim, complaint, investigation or notice of
noncompliance or potential responsibility or other proceedings alleging any
material failure of the Business or such Persons with respect to the Business to
comply with, or material liability of the Business or such Persons with respect
to the Business under, any Environmental Law;

 

(iv)     To the Knowledge of the Seller Parties, there has been no Release or
threatened or pending Release of Hazardous Materials at, under, to, about, on,
or from any Real Property or any other property currently or formerly owned,
licensed, leased, occupied, used or operated by any of the Seller Parties or
their Affiliates with respect to the Business, the Purchased Assets, the Assumed
Liabilities or the Station that would reasonably be expected to require any
Seller Party to conduct any material investigation, remediation or other
response action, or incur material Losses;

 

(v)     To the Knowledge of the Seller Parties, no Hazardous Materials are
generated, disposed, or present in, on, or under any of the Real Property except
for such Hazardous Materials as are (i) reasonably necessary for the customary
operation of the Station and the Business, and (ii) used, stored, handled and
disposed in material compliance with Environmental Laws; and

 

(vi)     The Seller Parties have made available to the Buyer true, complete and
correct copies of all environmental assessments, audits, inspections,
investigations, surveys or other similar environmental reports relating to the
Station, the Real Property, the Business or the Purchased Assets that are in the
possession, custody or control of the Seller Parties.

 

(b)     Other than as provided in Section 3.8, the representations and
warranties contained in this Section 3.19 are the sole and exclusive
representations and warranties relating to Environmental Law or Hazardous
Materials.

 

Section 3.20.     MVPD Matters. Schedule 3.20 contains, as of the date hereof,
(i) a list of each Station retransmission consent Contract existing as of the
date hereof to which any Seller Party or any of its Affiliates is a party with
any MVPD that has more than one thousand (1,000) paid subscribers in the
Station’s Market, and (ii) a list of the MVPDs that, to the Knowledge of the
Seller Parties, carry the Station and have more than one thousand (1,000) paid
subscribers with respect to the Station outside of the Station’s Market. The
applicable Seller Party or one of its Affiliates has entered into retransmission
consent contracts with respect to each MVPD that has more than one thousand
(1,000) paid subscribers in the Station's Market. To the Knowledge of the Seller
Parties, as of the date of this Agreement, no MVPD is retransmitting the signal
of the Station without the authorization of a Seller Party. Since December 31,
2013 and except as set forth on Schedule 3.20, as of the date hereof (x) no MVPD
with more than one thousand (1,000) paid subscribers in the Station’s Market has
provided written notice to the Seller Parties or their Affiliates of any
material signal quality issue or has failed to respond to a request for carriage
or, to the Knowledge of the Seller Parties, sought any form of relief from
carriage of the Station from the FCC and (y) none of the Seller Parties or their
Affiliates has received any written notice from any MVPD with more than one
thousand (1,000) paid subscribers in the Market of such MVPD’s intention to
delete a Station from carriage or to change a Station’s channel position.

 

 

 
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Section 3.21.     Certain Business Practices. Neither the Business (including
any of the Seller Parties or their Affiliates with respect to the Business),
nor, to the Knowledge of the Seller Parties, any representative of the Business
(including any of the Seller Parties or their Affiliates with respect to the
Business), acting in such capacity, has, directly or indirectly, (a) offered,
paid, promised to pay, or authorized a payment, of any money or other thing of
value (including any fee, gift, sample, travel expense or entertainment) or any
commission payment, or any payment related to political activity, to any
government official or employee, to any employee of any organization owned or
controlled in part or in full by any Governmental Body, or to any political
party or candidate, to influence the official or employee to act or refrain from
acting in relation to the performance of official duties, with the purpose of
obtaining or retaining business or any other improper business advantage or (b)
taken any action which would cause them to be in violation of the Foreign
Corrupt Practices Act of 1977 or any other anti-corruption or anti-bribery Law
applicable to them (whether by virtue of jurisdiction or organization or conduct
of business).

 

Section 3.22.     Transactions with Related Parties. Except as set forth on
Schedule 3.22, no Related Party of any Seller Party has: (a) borrowed money from
or loaned money to the Business or any of the Seller Parties or their Affiliates
with respect to the Business that remains outstanding or that will not be
discharged in accordance with this Agreement; (b) or has had any business
dealings or a financial interest in any transaction with the Business or with
the Seller Parties involving the Business or any of the Purchased Assets, other
than business dealings or transactions conducted in the ordinary course of
business at prevailing market prices and on prevailing market terms; (c) any
contractual or other claim, express or, to the Knowledge of the Seller Parties,
implied, of any kind whatsoever against or in respect of the Business; or (d)
any interest in any Purchased Assets.

 

Section 3.23.     No Finder. None of the Seller Parties, any of their Affiliates
or any party acting on any Seller Party’s or any of their Affiliates’ behalf has
paid or become obligated to pay any fee or commission to any broker, finder or
intermediary for or on account of the transactions contemplated by this
Agreement for which the Buyer may become liable.

 

 

 
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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE BUYER

 

As an inducement to the Seller Parties to enter into this Agreement and to
consummate the transactions contemplated hereby, the Buyer represents and
warrants to the Seller Parties as follows as of the date hereof and as of the
Closing:

 

Section 4.1.     Organization. Each of the Buyer and the Buyer Guarantor is
organized, validly existing and in good standing under the laws of the state of
its organization. Each of the Buyer and the Buyer Guarantor has the requisite
organizational power and authority to own, lease and operate the properties and
assets used in connection with its business as currently being conducted or to
be acquired pursuant hereto.

 

Section 4.2.     Authority of the Buyer.

 

(a)     Each of the Buyer and the Buyer Guarantor has the requisite
organizational power and authority to execute and deliver this Agreement and all
of the other agreements and instruments to be executed and delivered by the
Buyer or the Buyer Guarantor, as applicable, pursuant hereto (collectively, the
“Buyer Ancillary Agreements”), to consummate the transactions contemplated
hereby and thereby and to comply with the terms, conditions and provisions
hereof and thereof.

 

(b)     The execution, delivery and performance of this Agreement and the Buyer
Ancillary Agreements by each of the Buyer and the Buyer Guarantor have been duly
authorized and approved by all necessary organizational action on the part of
the Buyer and the Buyer Guarantor and do not require any further authorization
or consent on the part of the Buyer, the Buyer Guarantor or any of their
Affiliates. This Agreement is, and each other Buyer Ancillary Agreement when
executed and delivered by the Buyer or the Buyer Guarantor, as applicable, and
the other parties thereto will be, a legal, valid and binding agreement of the
Buyer or the Buyer Guarantor, as applicable, enforceable in accordance with its
respective terms, except in each case as such enforceability may be limited by
bankruptcy, moratorium, insolvency, reorganization or other similar laws
affecting or limiting the enforcement of creditors’ rights generally and except
as such enforceability is subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

 

(c)     Except for the FCC Consent, the DOJ Consent, as my be required by the
WARN Act or other similar Laws, and as set forth in Schedule 4.2, none of the
execution, delivery and performance by the Buyer or the Buyer Guarantor of this
Agreement, or by the Buyer or the Buyer Guarantor, as applicable, of the Buyer
Ancillary Agreements to which it is a party, the consummation by the Buyer or
the Buyer Guarantor, as applicable, of the transactions contemplated hereby or
thereby or compliance by the Buyer or the Buyer Guarantor, as applicable, with
or fulfillment by the Buyer or the Buyer Guarantor, as applicable, of the terms,
conditions and provisions hereof or thereof will:

 

(i)     conflict with, result in a breach of the terms, conditions or provisions
of, or constitute a default, an event of default or an event creating rights of
acceleration, termination or cancellation or a loss of rights under, or result
in the creation or imposition of any Encumbrance upon any assets of the Buyer
under, (A) the certificate of incorporation, bylaws or other organizational
documents of the Buyer or the Buyer Guarantor, as applicable, or (B) any
material indenture, note, mortgage, lease, guaranty or agreement, or any
material judgment, Order, award or decree, to which the Buyer or the Buyer
Guarantor, as applicable, is a party; or

 

 

 
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(ii)     require the approval, consent, authorization or act of, or the making
by the Buyer or the Buyer Guarantor, as applicable, of any declaration, filing
or registration with, any third Person or any foreign, federal, state or local
court, governmental or regulatory authority or body, except for any approval by
the DOJ, as required by the DOJ Final Judgment, except, in any case, as would
not, individually or in the aggregate, be reasonably likely to have a material
adverse effect on the ability of the Buyer to perform its obligations under this
Agreement.

 

Section 4.3.     Litigation. None of the Buyer, the Buyer Guarantor or any of
their Affiliates is a party to any action, suit or proceeding pending or, to the
knowledge of the Buyer, threatened which, if adversely determined, would
reasonably be expected to restrict the ability of the Buyer to consummate
promptly the transactions contemplated by this Agreement. There is no Order to
which the Buyer, the Buyer Guarantor or any of their Affiliates, is subject
which would reasonably be expected to restrict the ability of the Buyer or the
Buyer Guarantor to consummate promptly the transactions contemplated by this
Agreement.

 

Section 4.4.     No Finder. None of the Buyer, the Buyer Guarantor or any of
their Affiliates, or any party acting on any of their behalf has paid or become
obligated to pay any fee or commission to any broker, finder or intermediary for
or on account of the transactions contemplated by this Agreement for which the
Seller Parties or their Affiliates may become liable.

 

Section 4.5.     Qualifications as FCC Licensee.

 

(a)     The Buyer is legally, financially and otherwise qualified to be the
licensee of, and to acquire, own, operate and control, the Station under the
Communications Act, including the provisions relating to media ownership and
attribution, foreign ownership and control, and character qualifications. To the
Buyer’s knowledge, there are no facts or circumstances with respect to the Buyer
or Buyer Group Members that would (i) disqualify the Buyer as the assignee of
the Seller FCC Authorizations or as the owner and operator of the Station, (ii)
delay the FCC’s processing of the FCC Applications, or (iii) cause the FCC to
impose a material condition or conditions on its granting of the FCC Consent. No
waiver of or exemption from, whether temporary or permanent, any provision of
the Communications Act, or any divestiture or other disposition by the Buyer or
any of their respective Affiliates of any asset or property, is necessary for
the FCC Consent to be obtained under the Communications Act.

 

 

 
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Section 4.6.     Financial Capacity. The Buyer has, as of the date of this
Agreement, and will have, as of the Closing Date, on hand (or access through
committed credit facilities to) adequate funds to perform all of its obligations
under this Agreement.

 

ARTICLE V

ACTION PRIOR TO THE CLOSING DATE

 

The respective parties hereto covenant and agree to take the following actions
between the date hereof and the Closing Date:

 

Section 5.1.     Access to the Business. Upon the written request of the Buyer,
the Seller Parties shall use reasonable efforts to afford to the officers,
employees and authorized representatives of the Buyer (including independent
public accountants, attorneys and consultants) reasonable access during normal
business hours, and upon reasonable prior notice, to the offices, properties,
employees and business and financial records of the Business to the extent
reasonably necessary for Buyer’s transition planning and shall furnish to the
Buyer or its authorized representatives such additional information concerning
the Business as shall be reasonably requested to the extent reasonably necessary
for Buyer’s transition planning; provided, however, that the Seller Parties or
their Affiliates shall not be required to violate any obligation of
confidentiality or other obligation under applicable Law to which the Seller
Parties or any of their respective Affiliates are subject in discharging their
obligations pursuant to this Section 5.1. The Buyer agrees that any such access
shall be conducted in such a manner as not to interfere unreasonably with the
operations of Business, the Seller Parties or their Affiliates. Notwithstanding
the foregoing, none of the Seller Parties or their respective Affiliates shall
be required to (i) take any action which would constitute a waiver of
attorney-client or other privilege or would compromise the confidential
information of the Seller Parties or their Affiliates not related to the
Business, (ii) supply the Buyer with any information which, in the reasonable
judgment of the Seller Parties, the Seller Parties or any of their Affiliates
are under a contractual or legal obligation not to supply or (iii) permit the
Buyer or any of its Affiliates to conduct any sampling of soil, sediment,
groundwater, surface water or building material. Any information disclosed to
the Buyer by the Seller Parties under this Section 5.1 shall be held in
accordance with the Confidentiality Agreement, dated as of June 19, 2014 (the
“Confidentiality Agreement”), by and between Media General, LIN and Buyer
Guarantor.

 

Section 5.2.      Notification of Certain Matters.

 

(a)     The Buyer or the Buyer Guarantor, on the one hand, and the Seller
Parties, on the other hand, shall promptly notify the other upon becoming aware
of any material breach of any of their own respective representations or
warranties contained in this Agreement.

 

(b)     Each party shall promptly notify the other of any action, suit or
proceeding that shall be instituted or threatened against such party to
restrain, prohibit or otherwise challenge the legality of any transaction
contemplated by this Agreement. The Seller Parties shall promptly notify the
Buyer, and the Buyer shall promptly notify the Seller Parties, of any lawsuit,
claim, proceeding or investigation that is threatened, brought, asserted or
commenced against the other which would have been listed in Schedule 3.16 or
would be an exception to Section 4.3 if such lawsuit, claim, proceeding or
investigation had arisen prior to the date hereof.

 

 

 
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Section 5.3.     FCC Consent; Other Consents and Approvals.

 

(a)     As promptly as practicable after the date hereof, but in any event no
later than five (5) Business Days hereafter, the Seller Parties, the Buyer and
their respective Affiliates, as applicable, shall file with the FCC the
necessary applications requesting its consent to the Assignment of the Seller
FCC Authorizations to the Buyer, as contemplated by this Agreement (the “FCC
Applications”). The Seller Parties and the Buyer shall, or shall cause their
respective Affiliates to, cooperate in the preparation of such applications and
will diligently take, or cooperate in the taking of, all necessary, desirable
and proper steps, provide any additional information required by the FCC and
shall use reasonable best efforts to obtain promptly the FCC Consent; provided,
however, that the parties hereto acknowledge and agree that Seller Parties or
their Affiliates may take various actions solely related to obtaining necessary
approvals for the Mergers and to consummate the Mergers, including amending the
Seller Parties’ portion of the FCC Applications (which may affect the timing of
FCC action with respect to the FCC Applications), and such actions shall not be
deemed a violation of this obligation except to the extent such actions would be
reasonably likely to result in the return, dismissal, or withdrawal of the FCC
Applications or denial of the FCC Consent. The Seller Parties, on the one hand,
and the Buyer, on the other hand, shall bear the cost of FCC filing fees
relating to the FCC Applications equally. The Buyer and the Seller Parties shall
oppose any petitions to deny or other objections filed with respect to the FCC
Applications to the extent such petition or objection relates to any such party.
Neither Seller Parties nor Buyer shall, and each shall cause its Affiliates not
to, take any intentional action that would, or intentionally fail to take such
action the failure of which to take would, reasonably be expected to have the
effect of preventing the successful prosecution of the FCC Applications or
materially delaying the receipt of the FCC Consent; provided, however, that the
parties hereto acknowledge and agree that the Seller Parties and their
respective Affiliates may take various actions solely related to obtaining
necessary approvals for the Mergers and to consummate the Mergers, including
amending the FCC Applications (which may affect the timing of FCC action with
respect to the FCC Applications), and such actions shall not be deemed a
violation of this obligation except to the extent such actions would be
reasonably likely to result in the return, dismissal, or withdrawal of the FCC
Applications or denial of the FCC Consent. The parties agree that they will
cooperate to amend the FCC Applications as may be necessary or required to
reflect the consummation of the Mergers or to otherwise obtain the timely grant
of the FCC Consent.

 

(b)     The Seller Parties and the Buyer shall, use their respective reasonable
best efforts to consummate and make effective the transactions contemplated
hereby and to cause the conditions set forth in Article VII and Article VIII to
be satisfied as promptly as reasonably practicable after the date hereof,
including (i) in the case of the Buyer, the obtaining of all necessary approvals
under any applicable communications or broadcast Laws required in connection
with this Agreement, (ii) the obtaining of all necessary actions or nonactions,
consents and approvals from Governmental Bodies or other persons necessary in
connection with the consummation of the transactions contemplated by this
Agreement and, in the case of the Seller Parties, the Mergers (including, but
not limited to, the DOJ Consent and consents and approvals required pursuant to
the DOJ Final Judgment) and the making of all necessary registrations and
filings (including filings with Governmental Bodies if necessary) and the taking
of all reasonable steps as may be necessary to obtain an approval from, or to
avoid an action or proceeding by, any Governmental Body or other persons
necessary in connection with the consummation of the transactions contemplated
by this Agreement, (iii) the defending of any lawsuits or other legal
proceedings, whether judicial or administrative, challenging this Agreement or
the consummation of the transactions performed or consummated by such party in
accordance with the terms of this Agreement, including seeking to have any stay
or temporary restraining order entered by any court or other Governmental Body
vacated or reversed and (iv) the execution and delivery of any additional
instruments necessary to consummate the transactions to be performed or
consummated by such party in accordance with the terms of this Agreement and to
fully carry out the purposes of this Agreement; provided, however, that the
Seller Parties and their respective Affiliates may take various actions solely
related to obtaining necessary approvals for the Mergers and to consummate the
Mergers, including amending the FCC Applications, and such actions shall not be
deemed a violation of this obligation except to the extent such actions would be
reasonably likely to result in the return, dismissal, or withdrawal of the FCC
Applications or denial of the FCC Consent. Notwithstanding any provision to the
contrary in this Agreement, none of the Buyer or its Affiliates shall be
obligated to divest or agree to divest any station or assets in connection with
or relating to obtaining any consent or approval of any Person, notifying or
making any filings with any Person concerning the transactions contemplated by
this Agreement, or attempting to consummate and make effective the transactions
contemplated by this Agreement or cause the conditions in Articles VII and VIII
to be satisfied.

 

 

 
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(c)     The Seller Parties and the Buyer shall, and shall cause their respective
Affiliates to, use reasonable best efforts to obtain all consents, approvals and
amendments from the parties to the Station Agreements which are required by the
terms thereof or this Agreement for the consummation of the transactions
contemplated by this Agreement; provided, however, that none of the Seller
Parties, the Buyer or any of their Affiliates shall have any obligation to offer
or pay any consideration in order to obtain any such consents or amendments,
including, any obligation to accept or agree to any restrictions, limitations,
Encumbrances, to incur any obligation, liability, or to amend, modify or
otherwise alter the terms of any contract or agreement with any such party that
is not included in the Purchased Assets or, insofar as any Multi-Station
Contract relates to Other Seller Stations (as such terms are defined in Section
5.6), the terms thereof relating to Other Seller Stations; and provided,
further, that the parties acknowledge and agree that such third party consents
are not conditions to Closing, except for the certain third party consent set
forth on Schedule 5.3(c) (the “Required Consents”). All such consents and
amendments shall be in writing and executed copies thereof shall be delivered to
the Buyer and Seller Parties promptly after receipt thereof by the applicable
parties. None of the Seller Parties and Buyer shall, and the Seller Parties and
Buyer shall cause their Affiliates not to, agree to any modification of any
Station Agreements in the course of obtaining any consent or amendment where
such modification would materially adversely affect the Business.

 

Section 5.4.     Operations of the Station Prior to the Closing Date.

 

(a)     Subject to Section 6.3, prior to the Closing Date, except as approved by
the Buyer in writing (which approval shall not be unreasonably withheld, delayed
or conditioned), the Seller Parties shall cause the Business to be conducted in
the ordinary course of the Business consistent with past practice, and to the
extent consistent therewith:

 

 

 
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(i)     continue to promote and conduct advertising on behalf of the Station at
levels substantially consistent with past practice;

 

(ii)     keep and maintain the Purchased Assets in good operating condition and
repair (wear and tear in ordinary usage excepted);

 

(iii)     maintain the business organization of the Station intact;

 

(iv)     preserve the Business and the goodwill of the suppliers, contractors,
licensors, employees, customers, distributors and others having business
relations with the Business;

 

(v)     maintain the Station’s MVPD carriage in the Market existing as of the
date of this Agreement, and timely make retransmission consent elections (and
not elect must carry) with all MVPDs in the Market having one thousand (1,000)
or more subscribers;

 

(vi)     maintain in full force and effect the Seller FCC Authorizations and
other material Governmental Permits required to carry on the Stations Business,
including promptly filing renewal applications, timely filing required FCC
reports, and timely paying annual regulatory fees;

 

(vii)     deliver to the Buyer, within ten (10) days after filing, copies of any
applications or responses to the FCC related to the Station that are filed
during such period;

 

(viii)     notify the Buyer of any action, proceeding, or matter that occurs
after the date hereof that would have had to be disclosed in Schedule 3.8(c) had
such action, proceeding, or matter occurred prior to the date hereof; and

 

(ix)     operate in all material respects in accordance with, and comply with,
the Communications Act and with all other Laws applicable to the Business or the
Purchased Assets.

 

(b)     Notwithstanding Section 5.4(a) and subject to Section 6.3 regarding
control of the Station, except (w) as expressly contemplated by this Agreement,
(x) as set forth in Schedule 5.4(b), (y) as required by applicable Laws or by
any Governmental Body of competent jurisdiction, or (z) with the prior written
consent of the Buyer (which consent shall not be unreasonably withheld, delayed
or conditioned), the Seller Parties shall not, and shall cause their Affiliates
not to, in respect of the Station, the Business or the Purchased Assets:

 

(i)     enter into any Contract or commitment that (x) involves the payment or
potential payment of more than $25,000 per annum or $75,000 in the aggregate,
(y) has a term in excess of one year, or (z) would be required to be listed on
Schedule 3.14 were the Seller Parties or their Affiliates a party thereto as of
the date of this Agreement, other than in the ordinary course of the Business
and consistent with past practice;

 

 

 
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(ii)     amend, waive, modify or consent to the termination of any Assumed
Contract, or amend, waive, modify or consent to the termination of any material
right of the Seller Parties’ or their Affiliates’ thereunder, in each case,
other than in the ordinary course of the Business and consistent with past
practice; or notwithstanding Section 5.4(b)(i), enter into, amend, or renew any
Contract with the Rentrak Corporation or its Affiliates;

 

(iii)     other than those capital expenditures listed in Schedule 5.4(b)(iii),
make or authorize any new capital expenditures in excess of $25,000 in the
aggregate, other than in the ordinary course of the Business and consistent with
past practice or emergency repairs necessary for the continued operation of the
Business;

 

(iv)     sell, lease (as lessor), transfer or otherwise dispose of or mortgage
or pledge, or impose or suffer to be imposed any Encumbrance on, any of the
material assets or properties relating to the Purchased Assets, other than the
sale, lease (as lessor), transfer or other disposal of property in the ordinary
course of the Business or pursuant to existing contracts or commitments, and
other than Permitted Encumbrances;

 

(v)     hire any Person that would be an Employee as a department head or anchor
or chief on-air talent (provided that the Seller Parties may hire any Person to
be an Employee as a department head or anchor or chief on-air talent as long as
the applicable Seller Party reasonably consults the Buyer with respect to such
Person’s employment prior thereto); and other than in the ordinary course of the
Business, hire any Person that would be an Employee, or terminate any Employee
other than for cause as determined in good faith by any of the Seller Parties,
who earns base compensation at an annual rate exceeding $100,000;

 

(vi)     make, revoke or change any Tax election or settle or compromise any Tax
liability, in each case relating to the Business, other than on a basis
consistent with past practice;

 

(vii)     take or fail to take any action that could reasonably be expected to
cause the FCC or any other Governmental Body to institute proceedings for the
suspension, revocation or adverse modification of any of the Seller FCC
Authorizations in any material respect;

 

(viii)     other than in the ordinary course of the Business, enter into any
new, or materially modify the terms of any existing, Employment Agreement with
any Employee other than as required by Law;

 

(ix)     materially increase the cash compensation of the Employees, other than
changes made in accordance with normal compensation practices and consistent
with past compensation practices or as required by Law or by the terms of
existing Contracts or Employee Plans;

 

 

 
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(x)     enter into any Contract with any Related Party of a Seller Party;

 

(xi)     incur any liability that would constitute an Assumed Liability, except
in the ordinary course of the Business consistent with past practice or as
required by Law or by the terms of existing Contracts or Employee Plans;

 

(xii)     settle any litigation, claims or Proceedings to the extent arising out
of or related to the Purchased Assets, the Assumed Liability or the Business,
other than in the ordinary course of the Business and consistent with past
practice;

 

(xiii)     establish, adopt, enter into or amend in any material respect any
collective bargaining agreement or Employee Plan other than as required by Law
or by the terms of existing Contracts or Employee Plans;

 

(xiv)     adversely modify any of the Seller FCC Authorizations;

 

(xv)     apply to the FCC for any FCC license, construction permit,
authorization or any modification thereto that would restrict the Business after
the Closing, it being expressly understood and acknowledged that one or more of
the Seller Parties or their Affiliates with the FCC may enter into commitments
or agreements with Governmental Bodies that contain restrictions applicable to
the business of the Seller Parties after the Closing, including commitments by
the Seller Parties or their Affiliates not to enter into sharing agreements with
the Buyer or any of its Affiliates, and that this Agreement in no way restricts
the ability of the Seller Parties or their Affiliates to do so; or

 

(xvi)     agree or commit to do any of the foregoing.

 

Section 5.5.     Public Announcement. None of the Seller Parties, the Buyer or
any of their Affiliates shall, without the approval of the other, make any press
release or other public announcement concerning the transactions contemplated by
this Agreement, except as and to the extent that any such party shall be so
obligated by Laws or by the rules, regulations or policies of any national
securities exchange or association.

 

Section 5.6.     Multi-Station Contracts. Schedule 5.6 contains a list as of the
date hereof of Contracts which are included in the Purchased Assets and to which
one or more television stations of any of the Seller Parties or any of their
Affiliates (an “Other Seller Station”) is party to, or has rights or obligations
thereunder (any such contract or agreement, a “Multi-Station Contract”). The
rights and obligations under the Multi-Station Contracts that are assigned to
and assumed by Buyer (and included in the Purchased Assets and Assumed
Liabilities, as the case may be) shall include only those rights and obligations
under such Multi-Station Contracts that are applicable to the Station. The
rights of each Other Seller Station with respect to such contract or agreement
and the obligations of each Other Seller Station to such contract or agreement
shall not be assigned to and assumed by Buyer (and shall be Excluded Assets and
Excluded Liabilities, as applicable). For purposes of determining the scope of
the rights and obligations of the Multi-Station Contracts, the rights and
obligations under each Multi-Station Contract shall be equitably allocated among
(1) the Station, on the one hand, and (2) the Other Seller Stations, on the
other hand, in accordance with the following equitable allocation principles:

 

 

 
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(a)     any allocation set forth in the Multi-Station Contract shall control;
and

 

(b)     if there is no allocation in the Multi-Station Contract as described in
clause (a) hereof, then any reasonable allocation (to be determined by mutual
good faith agreement of the Seller Parties and Buyer) shall control.

 

(c)     Subject to any applicable third-party consents, such allocation and
assignment with respect to any Multi-Station Contract shall be effectuated, at
the election of the Buyer, by termination of such Multi-Station Contract in its
entirety with respect to the Station and the execution of new contracts with
respect to the Station or by an assignment to and assumption by Buyer of the
related rights and obligations under such Multi-Station Contract. The parties
shall use commercially reasonable efforts to obtain any such new contracts or
assignments to, and assumptions by, Buyer in accordance with this Section 5.6;
provided, that, completion of documentation of any such allocation under this
Section 5.6 is not a condition to Closing.

 

ARTICLE VI

ADDITIONAL AGREEMENTS

 

Section 6.1.     Taxes.

 

(a)     The Seller Parties shall prepare and timely file all Tax Returns with
respect to the Business and the Purchased Assets for taxable periods ending
prior to the Closing Date, and shall pay all Taxes reflected on such Tax
Returns. The Buyer shall prepare and timely file all Tax Returns with respect to
the Business and the Purchased Assets for taxable periods beginning on or after
the Closing Date, and for all periods beginning before and ending after the
Closing Date (each such period, a “Straddle Period”) and shall pay all Taxes
reflected on such Tax Returns. Notwithstanding this Section 6.1(a), (i) in the
case of all real property Taxes, personal property Taxes and similar ad valorem
obligations with respect to the Business or any of the Purchased Assets for any
Straddle Period, such property Taxes, personal property Taxes and similar ad
valorem obligations shall be apportioned between the Seller Parties, on the one
hand, and the Buyer, on the other hand, based on the number of days of such Tax
period up to and including the day prior to the Closing Date and the number of
days of such Tax period including and after the Closing Date, and the Seller
Parties shall be liable for the proportionate amount of such Taxes that is
attributable to the portion of the Tax period up to and including the day prior
to the Closing Date, and the Buyer shall be liable for the proportionate amount
of such Taxes that is attributable to the portion of the Tax period including
and after the Closing Date, and (ii) in the case of all other Taxes with respect
to the Business or any of the Purchased Assets for any Straddle Period (other
than federal, state and local income Taxes arising out of, or attributable to,
or resulting from the sale of the Purchased Assets and the Business or the
transactions contemplated by this Agreement), such Taxes shall be apportioned
between the Seller Parties, on the one hand, and the Buyer, on the other hand,
based on a “closing of the books” basis as if the relevant Tax period ended on
the day prior to the Closing Date, and the Seller Parties shall be liable for
the amount of such Taxes that is attributable to the portion of the Tax period
up to and including the day prior to the Closing Date, and the Buyer shall be
liable for the amount of such Taxes that is attributable to the portion of the
Tax period including and after the Closing Date.

 

 

 
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(b)     The Seller Parties shall, and shall cause their Affiliates to, pay all
federal, state and local income Taxes of the Seller Parties or their Affiliates,
as applicable, arising out of, or attributable to, or resulting from the sale of
the Purchased Assets and the Business contemplated by this Agreement.

 

(c)     Any Transfer Taxes shall be borne fifty percent (50%) by the Buyer and
fifty percent (50%) by the Seller Parties. The Seller Parties and the Buyer
shall reasonably cooperate in the preparation, execution and filing of all Tax
Returns, questionnaires, applications or other documents regarding any such
Transfer Taxes and in seeking or perfecting any available exemption from
Transfer Taxes.

 

(d)     The Seller Parties or the Buyer, as the case may be, shall promptly
provide reimbursement for any Tax paid by the other party which is the
responsibility of the Seller Parties or the Buyer, as the case may be, in
accordance with the terms of this Section 6.1. Within a reasonable time prior to
the payment of any such Tax, the party paying such Tax shall give notice to the
other party of the Tax payable and the portion which is the liability of each
party, although failure to do so will not relieve the other party from its
liability hereunder. The Buyer shall promptly notify the Seller Parties in
writing upon receipt by the Buyer or any of its Affiliates of notice of any
pending or threatened Tax audits, examinations or assessments which may affect
the Tax liabilities for which the Seller Parties would be liable pursuant to
this Section 6.1. The Seller Parties shall have the sole right to control any
Tax audit or administrative or court proceeding relating to taxable periods
ending before the Closing Date, and to employ counsel of their choice at their
expense. In the case of any Straddle Period, the Seller Parties shall be
entitled to participate at their expense in any Tax audit or administrative or
court proceeding relating in whole or in part to Taxes attributable to the
portion of such Straddle Period ending on the day prior to the Closing Date, and
at the sole expense of the Seller Parties, may assume control of such audit or
proceeding as to Taxes attributable to the portion of the Straddle Period ending
on the day prior to the Closing Date. Regardless of which party assumes the
defense of any such Tax audit or administrative or court proceeding, the parties
hereto agree to cooperate fully with each other in connection with the defense,
negotiation or settlement of any such Tax audit or administrative or court
proceeding. Such cooperation shall include providing records and information
that are relevant to such Tax audit or administrative or court proceeding, and
making each parties’ employees and officers available on a mutually convenient
basis to provide additional information and explanation of any material provided
hereunder and to act as a witness or respond to legal process. The Buyer may
not, and shall cause its Affiliates not to, settle any Tax claim for any taxable
period ending prior to the Closing Date (or for the portion of any Straddle
Period ending on the day prior to the Closing Date) without the prior written
consent of the Seller Parties, which consent shall not be unreasonably withheld,
delayed or conditioned.

 

 

 
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(e)     Each of the Seller Parties and the Buyer shall have the right to assign
its respective rights under this Agreement (but without release of its
respective obligations herein and without release of the other party’s
obligations herein) to a third party who may act as a “qualified intermediary”
or an “exchange accommodation titleholder” with respect to this Agreement in
accordance with the provisions of Section 1031 of the Code, the Treasury
Regulations promulgated thereunder, and any corresponding state or local income
Tax Laws (such assignment and related transactions, a “Like-Kind Exchange”);
provided that such assignment does not materially hinder or delay the
consummation of the transactions contemplated by this Agreement or the
prosecution of the FCC Applications. If either party elects to engage in a
Like-Kind Exchange, the party so electing (the “Electing Party”) shall notify
the other party of its election in writing no later than five (5) days prior to
the Closing. The Electing Party shall bear its own expenses in connection with
any such election to engage in a Like-Kind Exchange. Each of the Seller Parties
and the Buyer, as the case may be, shall cooperate fully with the Electing
Party, and take any action reasonably requested by the Electing Party, in
connection with enabling the transactions to qualify in whole or in part as a
Like-Kind Exchange; provided, however, that such actions do not impose any
liabilities, including any unreimbursed monetary obligations or costs, on the
Seller Parties or the Buyer, as the case may be, and that the Electing Party
shall promptly reimburse the other party for any third-party costs reasonably
incurred in connection with such election, including as the result of any
subsequent review of such election by any Governmental Body or any attendant tax
consequences.

 

Section 6.2.     Employees; Employee Benefit Plans

 

(a)     Employment. The Seller Parties shall provide an updated Schedule 3.12 to
the Buyer no later than thirty (30) days prior to the Closing (provided that the
Buyer provides the Seller Parties with reasonable advance written notice of the
Closing Date). As of or before the Closing, the Buyer shall offer employment to
each Employee who (i) is not then on authorized leave of absence, sick leave,
short or long term disability leave, military leave or layoff with recall rights
(“Active Employees”); or (ii) is then on authorized leave of absence, sick
leave, short term disability leave, military leave or layoff with recall rights
and who returns to active employment immediately following such absence and
within six (6) months of the Closing Date, or such later date as required under
applicable Laws (“Inactive Employees”) it being understood that Buyer shall not
be obligated to offer employment to any Employee whose principal work location
is not at the Station or whose employment responsibilities relate substantially
to the corporate operations of the Seller Parties or their Affiliates or the
business of one or more of the other stations owned by the Seller Parties or
their Affiliates, and such Persons shall not be deemed Transferred Employees for
any purpose. For the purposes hereof, all Active Employees, or Inactive
Employees who accept an offer of employment from the Buyer and commence
employment on the applicable Employment Commencement Date are hereinafter
referred to collectively as the “Transferred Employees,” and the “Employment
Commencement Date” as referred to herein shall mean (x) as to those Transferred
Employees who are Active Employees, the Closing Date, and (y)  those Transferred
Employees who are Inactive Employees, the date on which the Transferred Employee
begins employment with the Buyer. The Buyer shall employ at-will those
Transferred Employees who do not have employment agreements with any of the
Seller Parties initially at a salary and position and on terms and conditions
determined by the Buyer but with monetary compensation (consisting of base
salary, and, as applicable, commission rate and normal bonus opportunity)
substantially the same as those provided by the applicable Seller Party
immediately prior to the Employment Commencement Date. The initial terms and
conditions of employment for those Transferred Employees who have Employment
Agreements with the Seller Parties shall be as set forth in such Employment
Agreements, which shall, to the extent permitted under the applicable
agreements, be assigned to Buyer and assumed by Buyer. The Buyer agrees that it
or one of its Affiliates shall, for at least one (1) year after the Closing
Date, provide each Transferred Employee who remains employed with the Buyer with
employee benefits that are substantially similar to the employee benefits (but
not pension benefits) provided to similarly situated employees of Hearst
Properties Inc. The Buyer agrees that it and its Affiliates, for at least one
(1) year after the Closing Date, shall provide severance benefits to the
Transferred Employees on terms that are substantially similar to those provided
to similarly situated employees of Hearst Properties Inc. With respect to all
Employees, the Seller Parties shall be responsible for all liabilities,
compensation, and any benefits (including severance) arising prior to or in
connection with or as a result of the termination by the Seller Parties or their
Affiliates of such Employees (in accordance with Seller Parties’ and their
Affiliates’ employment terms) or with respect to any Employee who does not
accept Buyer’s offer for employment.

 

 

 
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(b)     Service Credit. From and after the Closing Date, for purposes of
determining eligibility to participate and vesting only under any plan
maintained by the Buyer or its Affiliates in which Transferred Employees are
eligible to participate, the Buyer shall, and shall cause its Affiliates to,
recognize or cause to be recognized each Transferred Employee’s service with the
Seller Parties or any of their Affiliates, and with any predecessor employer, to
the same extent recognized by the Seller Parties, as service with the Buyer or
any of its Affiliates to the same extent such service was recognized immediately
prior to the Closing under a comparable benefit plan in which such Transferred
Employee was eligible to participate immediately prior to the Closing, except
that such service need not be recognized to the extent such recognition would
result in the duplication of benefits for the same period of service.

 

(c)     401(k) Plan. The Buyer shall cause a tax-qualified defined contribution
plan established or designated by the Buyer or any of its Affiliates (“Buyer’s
401(k) Plan”) to accept rollover contributions from the Transferred Employees of
any account balances distributed to them as a result of the transactions
contemplated by this Agreement by the existing tax-qualified defined
contribution plan established or designated by the Seller Parties or any of
their Affiliates. The Buyer shall, and shall cause its Affiliates to, allow any
such Transferred Employees’ outstanding plan loan to be rolled into Buyer’s
401(k) Plan. The distribution and rollover described herein shall comply with
applicable Laws, and the Buyer and the Seller Parties shall, and shall cause
their respective Affiliates to, make all filings and take any actions required
of each such Person by applicable Laws in connection therewith. The Buyer shall
cause Buyer’s 401(k) Plan to credit Transferred Employees with service credit
for eligibility and vesting purposes for service recognized for the equivalent
service under Seller’s 401(k) Plan.

 

(d)     Welfare Plans. The Seller Parties shall retain responsibility for and
continue to pay all medical, life insurance, disability and other welfare plan
expenses and benefits for each Transferred Employee with respect to claims
incurred under the terms of the Employee Plans by such employees or their
covered dependents prior to the Employment Commencement Date and shall retain
responsibility for any and all liability or other obligation under Code Section
4980B or Sections 601-608 of ERISA or other applicable Laws in connection with
the transactions contemplated by this Agreement with respect to any group health
plan of any of the Seller Parties or their Affiliates. Further, the Seller
Parties shall not commit any act or omission which would directly or indirectly
give rise to any liability or other obligation on the part of the Buyer or any
of its Affiliates (or any group health plan relating to the Buyer or any of its
Affiliates) as or in relation to a “successor employer” (i) under Code Section
4980B or Sections 601-608 of ERISA or other applicable Law in connection with
the transactions contemplated by this Agreement or any group health plan
relating to the Seller Parties or their Affiliates, or (ii) in connection with
any Employee Plan. With respect to any welfare benefit plans maintained by the
Buyer or any of its Affiliates for which the Transferred Employees are eligible
to participate on and after the Employment Commencement Date, to the extent
permitted by Laws and the terms of those welfare benefit plans, the Buyer shall,
and shall cause its Affiliates to (a) cause there to be waived any eligibility
requirements or pre-existing condition limitations to the same extent waived
generally by the Buyer and its Affiliates with respect to their employees and
(b) give effect, in determining any deductible and maximum out-of-pocket
limitations, amounts paid by such Transferred Employees with respect to similar
plans maintained by the Seller Parties or their Affiliates.

 

 

 
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(e)     Vacation. The Buyer shall assume as of Closing all liabilities for
unpaid, accrued vacation of each Transferred Employee as of the Employment
Commencement Date, giving service credit under the vacation policy of the Buyer
for service with the Seller Parties, and shall permit Transferred Employees to
use their vacation entitlement accrued as of Closing in accordance with the
policy of the Seller Parties as of Closing for carrying over unused vacation.
Notwithstanding any provision in this Agreement to the contrary, no Transferred
Employee shall be entitled to receive duplicate credit for the same period of
service.

 

(f)     Sick Leave. The Buyer shall grant credit under the policy of the Buyer
to Transferred Employees for all unused sick leave accrued by Transferred
Employees on the basis of their service during the current calendar year as
employees of the Seller Parties and their Affiliates.

 

(g)     Flexible Spending Accounts. Effective as of Closing, the Buyer shall
establish flexible spending accounts for medical and dependent care expenses for
Transferred Employees covered by that type of account in an Employee Plan as of
immediately prior to the Closing. The Buyer shall credit such accounts with the
amount (positive or negative) credited as of the Closing Date to such
Transferred Employees under the Employee Plan. The existing flexible spending
account elections for such employees as of the Closing Date shall apply under
the Buyer’s post-Closing flexible spending account plan year in which the
Closing Date occurs. As soon as practicable after the Closing Date, (i) the
Seller Parties shall pay to the Buyer in cash the amount, if any, by which the
aggregate contributions made by covered employees to the Seller Parties’
flexible spending accounts exceeded the aggregate benefits provided to such
employees as of the Closing Date or (ii) the Buyer shall pay to the Seller
Parties in cash the amount, if any, by which aggregate benefits provided to such
employees under the Seller Parties’ flexible spending accounts exceeded the
aggregate contributions made by such employees as of the Closing Date.

 

 

 
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(h)     Payroll Matters.

 

(i)     The Seller Parties and the Buyer shall follow the “standard procedures”
for preparing and filing Internal Revenue Service Forms W-2 (Wage and Tax
Statements), as described in Revenue Procedure 2004-53 for Transferred
Employees. Under this procedure, (i) the Seller Parties shall provide all
required Forms W-2 to (x) all Transferred Employees reflecting wages paid and
taxes withheld by the Seller Parties prior to the Employment Commencement Date,
and (y) all other employees and former employees of the Seller Parties who are
not Transferred Employees reflecting all wages paid and taxes withheld by the
Seller Parties, and (ii) the Buyer (or one of its Affiliates) shall provide all
required Forms W-2 to all Transferred Employees reflecting all wages paid and
taxes withheld by the Buyer (or one of its Affiliates) on and after the
Employment Commencement Date.

 

(ii)     The Seller Parties and the Buyer shall adopt the “alternative
procedure” of Revenue Procedure 2004-53 for purposes of filing Internal Revenue
Service Forms W-4 (Employee’s Withholding Allowance Certificate) and W-5 (Earned
Income Credit Advance Payment Certificate). Under this procedure, the Seller
Parties shall provide to the Buyer all Internal Revenue Service Forms W-4 and
W-5 on file with respect to each Transferred Employee and any written notices
received from the Internal Revenue Service under Reg. § 31.3402(f)(2)-1(g)(5) of
the Code, and the Buyer will honor these forms until such time, if any, that
such Transferred Employee submits a revised form.

 

(iii)     With respect to garnishments, tax levies, child support orders, and
wage assignments in effect with the Seller Parties on the Employment
Commencement Date for Transferred Employees and with respect to which the Seller
Parties have notified the Buyer in writing, the Buyer shall, and shall cause its
Affiliates to, honor such payroll deduction authorizations with respect to
Transferred Employees and shall, or shall cause its Affiliates to, continue to
make payroll deductions and payments to the authorized payee, as specified by a
court or order which was filed with the Seller Parties on or before the
Employment Commencement Date, to the extent such payroll deductions and payments
are in compliance with applicable Laws, and the Seller Parties will continue to
make such payroll deductions and payments to authorized payees as required by
Laws with respect to all other employees of the Business who are not Transferred
Employees. The Seller Parties shall, as soon as practicable after the Employment
Commencement Date, provide the Buyer with such information in the possession of
the Seller Parties as may be reasonably requested by the Buyer and necessary for
the Buyer or its Affiliates to make the payroll deductions and payments to the
authorized payee as required by this Section 6.2(i).

 

(i)     WARN Act. The Buyer and the Seller Parties agree to cooperate in good
faith to determine whether any notification may be required under the Worker
Adjustment and Retraining Act of 1988, as amended (the “WARN Act”) or other
similar Laws, as a result of the transactions contemplated under this Agreement
and, if such notices are required, to provide such notice in a manner that is
reasonably satisfactory to each of the parties hereto.

 

 

 
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(j)     Without limiting the generality of Section 11.6, nothing in this Section
6.2, express or implied, is intended to confer on any Person (including any
Transferred Employees and any current or former employees of the Seller Parties
or any of their Affiliates) other than the parties hereto and their respective
successors and assigns, any rights, benefits, remedies, obligations or
liabilities under or by reason of this Section 6.2. Accordingly, notwithstanding
anything to the contrary in this Section 6.2, the parties expressly acknowledge
and agree that this Agreement is not intended to create a contract between the
Buyer, the Seller Parties or any of their respective Affiliates, on the one
hand, and any employee of the Seller Parties on the other hand, and no employee
of the Seller Parties or any of their Affiliates may rely on this Agreement as
the basis for any breach of contract claim against the Buyer, the Seller Parties
or any of their respective Affiliates.

 

Section 6.3.     Control of Operations Prior to Closing Date. Notwithstanding
anything contained herein to the contrary, the sale of the Purchased Assets
contemplated hereby shall not be consummated prior to the grant by the FCC of
the FCC Consent. The Seller Parties and the Buyer acknowledge and agree that at
all times commencing on the date hereof and ending on the Closing Date, (x)
nothing in this Agreement, including Section 5.4, shall be construed to give the
Buyer any right to, control, direct or otherwise supervise, or attempt to
control, direct or otherwise supervise, any of the management or operations of
the Station and (y) the Seller Parties shall have complete control and
supervision of the programming, operations, policies and all other matters
relating to the Station.

 

Section 6.4.     Bulk Transfer Laws. The Buyer hereby waives compliance by the
Seller Parties or their Affiliates with the provisions of any so-called bulk
sales or bulk transfer Law of any jurisdiction in connection with the sale of
the Purchased Assets to the Buyer hereunder; provided, however, that, the Seller
Parties will be liable and indemnify the Buyer for any liability arising from
the Seller Parties’ non-compliance with any such Law.

 

Section 6.5.     Use of Names. The Seller Parties are not conveying ownership
rights or granting the Buyer a license to use any of the Retained Names and
Marks and, after the Closing, the Buyer shall not and shall not permit any of
its Affiliates to use in any manner the Retained Names and Marks or any word
that is similar in sound or appearance to such names or marks. In the event the
Buyer violates any of its obligations under this Section 6.5, the Seller Parties
may proceed against the Buyer in law or in equity for such damages or other
relief as a court may deem appropriate. The Buyer acknowledges that a violation
of this Section 6.5 may cause the Seller Parties irreparable harm, which may not
be adequately compensated for by money damages. The Buyer therefore agrees that
in the event of any actual or threatened violation of this Section 6.5, any of
such parties shall be entitled, in addition to other remedies that they may
have, to a temporary restraining order and to preliminary and final injunctive
relief against the Buyer or any such Affiliate of the Buyer to prevent any
violations of this Section 6.5, without the necessity of posting a bond.

 

 

 
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Section 6.6.     Accounts.

 

(a)     Effective as of the Closing Date, the Seller Parties hereby irrevocably
constitute and appoint the Buyer as their true and lawful attorney-in-fact with
full power of substitution (i) to collect in a reasonable manner consistent with
reasonable past practice for the account of the Buyer any Purchased Assets and
(ii) to institute and prosecute all proceedings that the Buyer may in its sole
discretion deem proper in order to enforce any right, title or interest in, to
or under the Purchased Assets, and to defend or compromise any and all actions,
suits or proceedings in respect of the Purchased Assets.

 

(b)     All payments and reimbursements received by the Seller Parties or their
Affiliates in connection with or arising out of the Purchased Assets or the
Assumed Liabilities after the Closing shall be held by the Seller Parties in
trust for the benefit of the Buyer and, promptly upon receipt by the Seller
Parties or their Affiliates of any such payment or reimbursement, the Seller
Parties shall pay over to the Buyer the amount of such payment or reimbursement
without right of setoff.

 

(c)     All payments and reimbursements received by the Buyer in connection with
or arising out of the Excluded Assets or the Excluded Liabilities after the
Closing Date shall be held by the Buyer in trust for the benefit of the Seller
Parties and, promptly upon receipt by the Buyer of any such payment or
reimbursement, the Buyer shall pay over to the Seller Parties the amount of such
payment or reimbursement without right of setoff.

 

Section 6.7.     Exclusivity. The Seller Parties shall not, and shall cause any
of their Affiliates not to, (i) solicit, initiate, or encourage the submission
of any proposal or offer from any Person relating to the acquisition, directly
or indirectly, of the Station, the Business or the Purchased Assets, or (ii)
participate in any discussions or negotiations regarding, furnish any
information with respect to, assist or participate in, or facilitate in any
other manner any effort or attempt by any Person to do or seek any of the
foregoing. The Seller Parties will notify the Buyer immediately if any Person
makes any proposal, offer, inquiry, or contact with respect to any of the
foregoing, and will provide the Buyer with all details in the possession of the
Seller Parties or their Affiliates concerning such proposal, offer, inquiry, or
contact.

 

Section 6.8.     Non-Solicitation.

 

(a)     For a period of one year following the Closing, the Seller Parties shall
not, and shall cause its Affiliates not to, directly or indirectly through any
Person or contractual arrangement: solicit, recruit or hire any person who at
any time on or after the date of this Agreement is a Business Group Employee;
provided, that the foregoing shall not prohibit (A) a general solicitation to
the public of general advertising or similar methods of solicitation by search
firms not specifically directed at Business Group Employees or (B) the Seller
Parties or their Affiliates from soliciting, recruiting or hiring any Business
Group Employee who replies to such general solicitations described in (A) above,
has ceased to be employed or retained by the Seller Parties, the Buyer or any of
their respective Affiliates for at least six (6) months, or otherwise contacts
the Seller Parties, or their Affiliates on his or her own initiative. For
purposes of this Section 6.8, “Business Group Employee” means the Transferred
Employees and any employee of the Buyer or its Affiliates who is employed
primarily in connection with the Station.

 

 

 
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(b)     The Seller Parties acknowledge that the covenants of the Seller Parties
set forth in this Section 6.8 are an essential element of this Agreement and
that any breach by the Seller Parties of any provision of this Section 6.8 will
result in irreparable injury to the Buyer. The Seller Parties acknowledge that
in the event of such a breach, in addition to all other remedies available at
law, the Buyer shall be entitled to seek equitable remedies available at law in
accordance with Section 11.16. The Seller Parties have independently consulted
with its counsel and after such consultation agrees that the covenants set forth
in this Section 6.8 are reasonable and proper to protect the legitimate interest
of the Buyer.

 

(c)     If a court of competent jurisdiction determines that the character,
duration or geographical scope of the provisions of this Section 6.8 are
unreasonable, it is the intention and the agreement of the parties that these
provisions shall be construed by the court in such a manner as to impose only
those restrictions on the Seller Parties’ conduct that are reasonable in light
of the circumstances and as are necessary to assure to the Buyer the benefits of
this Agreement. If, in any judicial proceeding, a court shall refuse to enforce
all of the separate covenants of this Section 6.8 because taken together they
are more extensive than necessary to assure to the Buyer the intended benefits
of this Agreement, it is expressly understood and agreed by the parties that the
provisions hereof that, if eliminated, would permit the remaining separate
provisions to be enforced in such proceeding, shall be deemed eliminated, for
the purposes of such proceeding, from this Agreement.

 

Section 6.9.     Title Insurance. The Seller Parties shall, and shall cause
their respective Affiliates to use their respective commercially reasonable
efforts to, prior to Closing and thereafter to the extent applicable, facilitate
Buyer in obtaining, in form and substance reasonably satisfactory to it, for
each Owned Real Property: (A) a 2006 ALTA Extended Coverage Form Policy of Title
Insurance (together with all endorsements and affirmative coverages required by
the Buyer) issued by one or more title insurance companies selected by the Buyer
and (B) a currently dated, in-place survey prepared by a surveyor approved by
the Buyer and registered or licensed in the state in which such real property is
located in accordance with the 1999 Minimum Standard Detail Requirements for
ALTA/ASCM Land Title Surveys and such other standards as the title company may
require as condition to the removal of the standard survey exception from the
title policy for such property and certified to the Buyer and any of its
designees. Buyer shall provide the Seller Parties with copies of the title
policies and surveys promptly upon receipt. The Buyer shall pay the fees, costs
and expenses with respect to the title policies and surveys.

 

 

 
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ARTICLE VII

CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SELLER PARTIES

 

The obligations of the Seller Parties under this Agreement to consummate the
sale of the Purchased Assets contemplated hereby shall be subject to the
satisfaction, fulfillment or, where legally possible, waiver, on or prior to the
Closing Date, of the following conditions:

 

Section 7.1.     No Breach of Covenants and Warranties. (a) The Buyer shall have
performed and complied in all material respects with its covenants and
agreements contained herein required to be performed or complied with by it as
of or prior to the Closing; and (b) each of the representations and warranties
of the Buyer contained in this Agreement shall be true and correct on the
Closing Date as though made on the Closing Date (except to the extent that they
expressly speak as of a specific date or time other than the Closing Date, in
which case they need only have been true and correct as of such specified date
or time), except where the failure of such representations and warranties to be
true and correct (without giving effect to any qualifiers or exceptions relating
to “materiality” set forth in such representations and warranties), individually
or in the aggregate, has not had and would not be reasonably likely to have a
material adverse effect on the ability of the Buyer to perform its obligations
under this Agreement. In addition, the Buyer shall have delivered to the Seller
Parties a certificate, dated as of the Closing Date, signed by an executive
officer of the Buyer and certifying as to the satisfaction of the conditions
specified in this Section 7.1.

 

Section 7.2.     No Restraint. There shall not be in effect any preliminary or
permanent injunction or other Order, decree or ruling by a court of competent
jurisdiction that restrains, enjoins or otherwise prohibits the consummation of
the sale and purchase of the Purchased Assets and/or the assumption of the
Assumed Liabilities contemplated hereby.

 

Section 7.3.     Certain Governmental Approvals.

 

(a)     The FCC Consent shall have been granted and shall be effective; and

 

(b)     Prior written approval by the DOJ of the terms of the transactions
contemplated by this Agreement as prescribed in the DOJ Final Judgment and DOJ
Consent shall have been obtained.

 

Section 7.4.     Mergers. The Mergers shall have been consummated.

 

Section 7.5.     Deliveries. The Buyer shall have made, or stands ready at the
Closing to make, the deliveries contemplated by Section 2.8(b) to the Seller
Parties.

 

Section 7.6.     WVTM-TV Transaction. The transactions contemplated by the WVTM
Asset Purchase Agreement shall have been consummated prior to or simultaneously
with the Closing.

 

 

 
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ARTICLE VIII

CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BUYER

 

The obligations of the Buyer under this Agreement to consummate the purchase of
the Purchased Assets and the assumption of the Assumed Liabilities contemplated
hereby shall, be subject to the satisfaction, fulfillment or, where legally
possible, waiver on or prior to the Closing Date, of the following conditions:

 

Section 8.1.     No Breach of Covenants and Warranties. (a) The Seller Parties
shall have performed and complied in all material respects with their respective
covenants and agreements contained herein required to be performed or complied
with by them as of or prior to the Closing; and (b) each of the representations
and warranties of the Seller Parties contained in this Agreement shall be true
and correct on the Closing Date as though made on the Closing Date (except to
the extent that they expressly speak as of a specific date or time other than
the Closing Date, in which case they need only have been true and correct as of
such specified date or time), except where the failure of such representations
and warranties to be true and correct (without giving effect to any qualifiers
or exceptions relating to “materiality” or “Material Adverse Effect” set forth
in such representations and warranties), would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect. In addition,
the Seller Parties shall have delivered to the Buyer a certificate, dated as of
the Closing Date, signed by an executive officer of the Seller Parties and
certifying as to the satisfaction of the conditions specified in this Section
8.1.

 

Section 8.2.     No Restraint. There shall not be in effect any preliminary or
permanent injunction or other Order, decree or ruling by a court of competent
jurisdiction that restrains, enjoins or otherwise prohibits the consummation of
the sale and purchase of the Purchased Assets and/or the assumption of the
Assumed Liabilities contemplated hereby.

 

Section 8.3.     Certain Governmental Approvals.

 

(a)     The FCC Consent shall have been granted and shall be effective, and in
the event any petition to deny, application for review, or other objection has
been filed with respect to the FCC Applications or the FCC Consent, at Buyer’s
option, the FCC Consent shall have become a Final Order; provided, however, that
if the Closing occurs before the FCC Consent shall become a Final Order, Buyer
and Seller Parties shall have entered into a mutually acceptable unwind
agreement providing for the unwinding of the Closing in the event the FCC
Consent is reversed, rescinded, vacated, set aside or annulled; and

 

(b)     Prior written approval by the DOJ of the terms of the transactions
contemplated by this Agreement as prescribed in the DOJ Final Judgment and DOJ
Consent shall have been obtained.

 

Section 8.4.     Closing Deliveries. The Seller Parties and their Affiliates
shall have made, or stand ready at the Closing to make, the deliveries
contemplated by Section 2.8(a) to the Buyer.

 

 

 
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Section 8.5.     Required Consents. The Required Consents shall have been
obtained and delivered to the Buyer without any modification, amendment, or
conditions to the underlying Assumed Contract except as expressly approved by
Buyer (such approval not to be unreasonably withheld, conditioned or delayed).

 

Section 8.6.     No Material Adverse Effect. Since the date of this Agreement,
there shall not have occurred any change, event or development that,
individually or in the aggregate, has had or is reasonably likely to have a
Material Adverse Effect.

 

Section 8.7.     WVTM-TV Transaction. The transactions contemplated by the WVTM
Asset Purchase Agreement shall have been consummated prior to or simultaneously
with the Closing.

 

ARTICLE IX

INDEMNIFICATION

 

Section 9.1.     Indemnification by the Seller Parties. From and after the
Closing and subject to Section 11.1, the Seller Parties agree jointly and
severally to indemnify, defend and hold harmless the Buyer Group Members from
and against any and all Losses and Expenses imposed upon, or incurred or
suffered by, any Buyer Group Member as a result of or arising out of or relating
to or caused by:

 

(i)     any breach by any of the Seller Parties of, or any other failure of any
of the Seller Parties to perform, any of their covenants, agreements or
obligations pursuant to this Agreement or any Ancillary Agreements;

 

(ii)     any breach of or inaccuracy of any representation or warranty of any of
the Seller Parties contained in this Agreement or any certificate delivered by
or on behalf of any of the Seller Parties pursuant hereto;

 

(iii)     the Excluded Liabilities; or

 

(iv)     a Seller Party’s failure to comply with the terms and conditions of any
bulk sales or bulk transfer or similar Laws of any jurisdiction that may be
applicable to the sale or transfer of any or all of the Purchased Assets to the
Buyer.

 

provided, however, that in respect of the Non-Fundamental Representations, the
Seller Parties shall not be required to indemnify and hold harmless pursuant to
clause (ii) of this Section 9.1 with respect to Losses and Expenses imposed
upon, or incurred or suffered by, the Buyer Group Members until, and then only
to the extent that, the aggregate amount of all such Losses and Expenses exceed
one percent (1%) of the Purchase Price (the “Deductible”); and, provided,
further, that the aggregate amount of Losses and Expenses that the Seller
Parties shall be required to indemnify and hold harmless pursuant to clause (ii)
of this Section 9.1 in respect of Non-Fundamental Representations shall not
exceed the Cap. For purposes of this Agreement, the “Cap” means (a) an amount
equal to ten percent (10%) of the Purchase Price. For purposes of clarity, the
Deductible and the Cap shall not apply to the Fundamental Representations. Any
qualification of the representations and warranties of the Seller Parties or
their Affiliates by reference to materiality or Material Adverse Effect, where
applicable, relating to the matters stated therein, or words of similar effect,
shall be disregarded in determining the amount of Losses and Expenses arising
therefrom; provided that the foregoing shall not apply to Section 3.4(a).

 

 

 
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Section 9.2.     Indemnification by the Buyer. From and after the Closing and
subject to Section 11.1, the Buyer agrees to indemnify and hold harmless each of
the Seller Parties from and against any and all Losses and Expenses imposed
upon, or incurred or suffered by, any Seller Group Member as a result of or
arising out of or relating to or caused by:

 

(i)     any breach by the Buyer of, or any other failure of the Buyer to
perform, any of its covenants, agreements or obligations in this Agreement;

 

(ii)     any breach of or inaccuracy of any representation or warranty of the
Buyer contained or in this Agreement or any certificate delivered by or on
behalf of the Buyer pursuant hereto; or

 

(iii)     the Assumed Liabilities.

 

provided, however, that in respect of the Non-Fundamental Representations only,
the Buyer shall not be required to indemnify and hold harmless pursuant to
clause (ii) of this Section 9.2 with respect to Losses and Expenses imposed
upon, or incurred or suffered by, Seller Group Members until, and then only to
the extent that, the aggregate amount of all such Losses and Expenses exceed the
Deductible; and, provided, further, that the aggregate amount of Losses and
Expenses that the Buyer shall be required to indemnify and hold harmless
pursuant to clause (ii) of this Section 9.2, other than in respect of the
Non-Fundamental Representations, shall not exceed the Cap. Any qualification of
the representations and warranties of the Buyer or its Affiliates by reference
to materiality or Material Adverse Effect, where applicable, relating to the
matters stated therein, or words of similar effect, shall be disregarded in
determining the amount of Losses and Expenses arising therefrom.

 

 

 

Section 9.3.     Notice of Claims; Determination of Amount.

 

(a)     Any party seeking indemnification hereunder (the “Indemnified Party”)
shall give promptly to the party or parties, as applicable, obligated to provide
indemnification to such Indemnified Party (the “Indemnitor”) a written notice (a
“Claim Notice”) describing in reasonable detail the facts giving rise to the
claim for indemnification hereunder and shall include in such Claim Notice (if
then known) the amount or the method of computation of the amount of such claim,
and a reference to the provision of this Agreement or any certificate delivered
hereunder upon which such claim is based. Subject to Section 11.1, the failure
of any Indemnified Party to give the Claim Notice as required by this Section
9.3 shall not affect such Indemnified Party’s rights under this Article IX
except to the extent such failure is actually materially prejudicial to the
rights and obligations of the Indemnitor.

 

 

 
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(b)     In calculating any Loss or Expense there shall be deducted (i) any net
amount actually recovered by the indemnified party under insurance policies or
from any other third Person (and no right of subrogation shall accrue hereunder
to any such insurer or other third Person) and (ii) any net Tax benefit actually
realized. The Indemnitor shall not be entitled to require that any action be
made or brought against any other Person before action is brought or claim is
made against it hereunder by the Indemnified Party.

 

Section 9.4.     Third Person Claims.

 

(a)     In order for a party to be entitled to any indemnification provided for
under this Agreement in respect of, arising out of or involving a claim or
demand made by any third Person against the Indemnified Party, such Indemnified
Party shall notify the Indemnitor in writing, and in reasonable detail, of the
third Person claim promptly, but in any event within ten (10) days, after
receipt by such Indemnified Party of written notice of the third Person claim,
which such notification must include a copy of the written notice of the third
Person claim that was received by the Indemnified Party (the “Third Person Claim
Notice”). Thereafter, the Indemnified Party shall deliver to the Indemnitor,
promptly, but in any event within five (5) Business Days, after the Indemnified
Party’s receipt thereof, copies of all notices and documents (including court
papers) received by the Indemnified Party relating to the third Person claim.
Notwithstanding the foregoing, should a party be physically served with a
complaint with regard to a third Person claim, the Indemnified Party must notify
the Indemnitor with a copy of the complaint promptly, but in any event within
five (5) Business Days, after receipt thereof and shall deliver to the
Indemnitor promptly, but in any event within seven (7) Business Days, after the
receipt of such complaint copies of notices and documents (including court
papers) received by the Indemnified Party relating to the third Person claim.
Subject to Section 11.1, the failure of any Indemnified Party to promptly
provide a Third Person Claim Notice as required by this Section 9.4 shall not
affect such Indemnified Party’s rights under this Article IX except to the
extent such failure is actually materially prejudicial to the rights and
obligations of the Indemnitor.

 

(b)     In the event of the initiation of any legal proceeding against the
Indemnified Party by a third Person that is exclusively for civil monetary
damages at law, if the Indemnitor acknowledges in writing its obligation to
indemnify the Indemnified Party against any and all Losses and Expenses that may
result from such claim, the Indemnitor shall have the sole and absolute right
after the receipt of a Third Person Claim Notice, at its option and at its own
expense, to be represented by counsel of its choice and to control, defend
against, negotiate, settle or otherwise deal with any proceeding, claim, or
demand which relates to any loss, liability or damage indemnified against
hereunder; provided, however, that the Indemnified Party may participate in any
such proceeding with counsel of its choice and at its expense. The parties
hereto agree to cooperate fully with each other in connection with the defense,
negotiation or settlement of any such proceeding, claim or demand. Prior to the
time the Indemnified Party is notified by the Indemnitor as to whether the
Indemnitor will assume the defense of such proceeding, claim or demand, the
Indemnified Party shall use commercially reasonable efforts to take actions
reasonably necessary to timely preserve the collective rights of the parties
with respect to such proceeding, claim or demand, including responding timely to
legal process. To the extent the Indemnitor elects not to defend such
proceeding, claim or demand (or fails to confirm its election) within thirty
(30) days after the giving by the Indemnified Party to the Indemnitor of a Third
Person Claim Notice, the Indemnified Party may retain counsel reasonably
acceptable to the Indemnitor, at the expense of the Indemnitor, and control the
defense of, or otherwise deal with, such proceeding, claim or demand. Regardless
of which party assumes the defense of such proceeding, claim or demand, the
parties agree to cooperate with one another in connection therewith. Such
cooperation shall include providing records and information that are relevant to
such proceeding, claim or demand, and making each parties’ employees and
officers available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder and to act as a
witness or respond to legal process. Whether or not the Indemnitor assumes the
defense of such proceeding, claim or demand, the Indemnified Party shall not
admit any liability with respect to, or settle, compromise or discharge or
consent to a settlement of, or the entry of any judgment arising from, any such
proceeding, claim or demand without the Indemnitor’s prior written consent
(which consent shall not be unreasonably withheld, conditioned or delayed)
unless such settlement or judgment includes as an unconditional term thereof the
release of the Indemnitor from all liability with respect to such proceeding,
claim or demand, in which event no such consent shall be required. The
Indemnitor shall not consent to a settlement of, or the entry of any judgment
arising from, any such proceeding, claim or demand without the Indemnified
Party’s prior written consent (which consent shall not be unreasonably withheld,
conditioned or delayed) unless such settlement or judgment (a) relates solely to
monetary damages for which the Indemnitor shall be responsible and (b) includes
as an unconditional term thereof the release of the Indemnified Party from all
liability with respect to such proceeding, claim or demand, in which event no
such consent shall be required. After any final judgment or award shall have
been rendered by a court, arbitration board or administrative agency of
competent jurisdiction and the time in which to appeal therefrom has expired, or
a settlement shall have been consummated, or the Indemnified Party and the
Indemnitor shall arrive at a mutually binding agreement with respect to each
separate matter alleged to be indemnified by the Indemnitor hereunder, the
Indemnitor shall pay all of the sums so owing to the Indemnified Party by wire
transfer, certified or bank cashier’s check within ten (10) days after the date
of such notice.

 

 

 
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(c)     The party that has assumed the control or defense of any such
proceeding, claim or demand made by a third Person against the other party shall
(a) provide the other party with the right to participate in any meetings or
negotiations with any Governmental Body or other third Person and reasonable
advance notice of any such meetings or negotiations, (b) provide the other party
with the right to review in advance and provide comments on any draft or final
documents proposed to be submitted to any Governmental Body or other third
Person, and (c) keep the other party reasonably informed with respect to such
proceeding, demand or claim, including providing copies of all documents
provided to, or received from, any Governmental Body or any other third Person
in connection with such proceeding, demand or claim. The Buyer Group Members, on
the one hand, and the Seller Group Members, on the other hand, covenant and
agree to maintain the confidence of all such drafts and comments provided by the
other.

 

To the extent of any inconsistency between this Section 9.4 and Section 6.1(d)
with respect to Taxes, the provisions of Section 6.1(d) shall control.

 

 

 
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Section 9.5.     Limitations; No Subrogation; Exclusive Remedies.

 

(a)     In any case where the Indemnified Party recovers from third Persons any
amount in respect of a matter with respect to which the Indemnitor has
indemnified it pursuant to this Article IX, the Indemnified Party shall promptly
pay over to the Indemnitor the amount so recovered (after deducting therefrom
the full amount of the expenses incurred by it in procuring such recovery), but
not in excess of any amount previously so paid by the Indemnitor to or on behalf
of the Indemnified Party in respect of such matter.

 

(b)     From and after the Closing, none of the Seller Parties or their
Affiliates or any of their respective employees or agents (as applicable) shall
have any right of contribution, right of indemnity or other right or remedy
against the Purchased Assets or any Person who owns, controls or operates the
Business after the Closing, in connection with any indemnification obligation or
any other liability to which such Seller Parties or their Affiliates or any of
their respective employees or agents, may become subject under this Agreement..

 

(c)     Except for remedies that cannot be waived as a matter of law and
injunctive, equitable and provisional relief, if the Closing occurs, this
Article IX shall be the exclusive remedy for breaches of this Agreement
(including any covenant, obligation, representation or warranty contained in
this Agreement or in any certificate delivered pursuant to this Agreement) or
otherwise relating to the subject matter of this Agreement, including any claims
arising under any Environmental Laws; provided, however, that nothing contained
in this Agreement shall relieve or limit the liability of any party for Losses
and Expenses arising out of or resulting from such party’s fraud, criminal
activity, intentional misrepresentation, or willful misconduct in connection
with the transactions contemplated by this Agreement or the Ancillary
Agreements.

 

Section 9.6.     No Special Damages; Mitigation. Notwithstanding anything to the
contrary contained in this Agreement, none of the parties hereto shall have any
liability under any provision of this Agreement for any punitive, incidental,
consequential, special, or indirect damages, except to the extent such damages
are payable to a third Person. Each of the parties agrees to take all reasonable
steps to mitigate their respective Losses and Expenses upon and after becoming
aware of any event or condition which could reasonably be expected to give rise
to any Losses and Expenses that are indemnifiable hereunder, including using its
commercially reasonable efforts to obtain insurance proceeds or other recoveries
from third Persons in respect thereof.

 

Section 9.7.     Effect of Knowledge. The right to rely on the representations,
warranties, covenants and agreements in this Agreement or any Ancillary
Agreement and the right to indemnification or any other remedy based on
representations, warranties, covenants and agreements in this Agreement or any
Ancillary Agreement shall not be affected by any investigation conducted at any
time, or any knowledge or information acquired or capable of being acquired at
any time, whether before or after the execution and delivery of this Agreement,
with respect to the accuracy or inaccuracy of or compliance with, any such
representation, warranty, covenant or agreement.

 

 

 
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ARTICLE X

TERMINATION

 

Section 10.1.     Termination.

 

(a)     Notwithstanding anything contained in this Agreement to the contrary,
this Agreement may be terminated at any time prior to the Closing:

 

(i)     by the mutual written consent of the Seller Parties and the Buyer;

 

(ii)     by the Seller Parties, if a breach or failure to perform any of the
covenants or agreements of the Buyer contained in this Agreement shall have
occurred, or there shall be any breach of or inaccuracy of any of the
representations or warranties of the Buyer contained in this Agreement, and such
breach, failure to perform or inaccuracy would, if occurring or continuing on
the Closing Date, give rise to the failure of a condition set forth in Section
7.1, and such breach, failure to perform or inaccuracy (x) cannot be cured prior
to the Termination Date or (y) if curable, is not cured on or before the earlier
of the Termination Date or thirty (30) days following receipt by the Buyer of
written notice of such breach, failure to perform or inaccuracy; provided,
however, that the Seller Parties shall not have the right to terminate this
Agreement pursuant to this Section 10.1(a)(ii) if any of the Seller Parties is
then in breach of any of its respective covenants or agreements contained in
this Agreement or any of the representations or warranties of the Seller Parties
contained in this Agreement shall be inaccurate, and, in any such case would
give rise to the failure of a condition set forth in Section 8.1;

 

(iii)     by the Buyer, if a breach or failure to perform any of the covenants
or agreements of the Seller Parties contained in this Agreement shall have
occurred, or there shall be any breach of or inaccuracy of any of the
representations or warranties of the Seller Parties contained in this Agreement,
and such breach, failure to perform or inaccuracy would, if occurring or
continuing on the Closing Date, give rise to the failure of a condition set
forth in Section 8.1, and such breach, failure to perform or inaccuracy (x)
cannot be cured prior to the Termination Date or (y) if curable, is not cured on
or before the earlier of the Termination Date or thirty (30) days following
receipt by the Seller Parties of written notice of such breach, failure to
perform or inaccuracy: provided, however, that the Buyer shall not have the
right to terminate this Agreement pursuant to this Section 10.1(a)(iii) if the
Buyer is then in breach of any of its covenants or agreements contained in this
Agreement or any of the representations or warranties of the Buyer contained in
this Agreement shall be inaccurate, and, in any such case would give rise to the
failure of a condition set forth in Section 7.1;

 

(iv)     by the Seller Parties or the Buyer, if any court of competent
jurisdiction shall have issued a final and non-appealable Order, decree or
ruling permanently restraining, enjoining or otherwise prohibiting the
consummation of the sale of the Purchased Assets contemplated hereby;

 

 

 
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(v)     by the Seller Parties or the Buyer, if (i) the Closing shall not have
occurred on or before 5:00 p.m., local New York time, on the one-year
anniversary of the date hereof (the “Initial Termination Date” and the Initial
Termination Date as extended as set forth below, the “Termination Date”) and
(ii) the party seeking to terminate this Agreement pursuant to this Section
10.1(a)(v) shall not have breached or failed to fulfill, as applicable, any of
its covenants or other obligations under this Agreement which were the cause of,
or resulted in, the failure of the Closing to occur prior to such time; or

 

(vi)     by the Seller Parties or the Buyer, upon the termination of the Merger
Agreement for any reason.

 

(b)     The party desiring to terminate this Agreement pursuant to Section
10.1(a) (other than pursuant to Section 10.1(a)(i)) shall give written notice of
such termination to the other party or parties, as applicable.

 

(c)     Subject to Section 10.1(d) below, in the event that this Agreement shall
be terminated pursuant to Section 10.1 (a), all further obligations of the
parties under this Agreement (other than Section 5.5, this Article X and Article
XI, and, for the avoidance of doubt, the Confidentiality Agreement, which, in
each case, shall remain in full force and effect) shall be terminated without
further liability of any party; provided that, subject to Section 10.1(d) below,
nothing herein shall relieve any party from liability for any breach of this
Agreement.

 

Section 10.2.     Withdrawal of Certain Filings. In the event of termination
under the provisions of this Article X, all filings, applications and other
submissions relating to the transactions contemplated by this Agreement as to
which termination has occurred shall, to the extent practicable, be withdrawn
from the Governmental Body or other Person to which made.

 

ARTICLE XI

GENERAL PROVISIONS

 

Section 11.1.     Survival of Representations, Warranties and Obligations. All
representations and warranties of the parties hereto contained in this Agreement
or any certificate delivered pursuant hereto shall survive the Closing and
remain in full force and effect for a period of fifteen (15) months following
the Closing Date (at which time the right to indemnification with respect
thereto shall terminate, subject to any notice of claim provided prior to such
time as described below); provided, however, that the representations and
warranties in Sections 3.1(a) (Organization), 3.2(a) and (b) (Authority of the
Seller Parties), 3.6 (Taxes), 3.7(b) (Title to Purchased Assets), 3.23 (No
Finder), 4.1 (Organization), 4.2(a) and (b) (Authority of the Buyer), and
Section 4.4 (No Finder) (such representations and warranties, collectively, the
“Fundamental Representations”) shall each survive the Closing and remain in full
force and effect until the fifth (5th) anniversary of the Closing Date (at which
time the right to indemnification with respect thereto shall terminate, subject
to any notice of claim provided prior to such time as described below) and the
representations and warranties in Section 3.19 (Environmental Protection) shall
survive the Closing and remain in full force and affect until the fifth (5th)
anniversary of the Closing Date (at which time the right to indemnification with
respect thereto shall terminate, subject provided prior to such time as
described below. Other than the Fundamental Representations, all representations
and warranties of the Seller Parties and their Affiliates contained herein or in
any certificate or other instrument or document delivered by the Seller Parties
or their Affiliates to the Buyer pursuant to this Agreement are collectively
referred to as the “Non-Fundamental Representations”. All of the covenants,
agreements or obligations in this Agreement (including those to be performed
prior to the Closing) shall survive the consummation of the Closing indefinitely
or for the period explicitly specified herein. No claim may be brought under
this Agreement unless written notice describing in reasonable detail the facts
giving rise to the claim is given on or prior to the last day of the applicable
survival period. In the event such notice is given, the right to indemnification
with respect thereto shall survive the applicable survival period until such
claim is finally resolved and any obligations with respect thereto are fully
satisfied.

 

 

 
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Section 11.2.     Confidential Nature of Information. Each party agrees that it
will treat in confidence all documents, materials and other information which it
shall have obtained regarding the other party or parties during the course of
the negotiations leading to the consummation of the transactions contemplated
hereby (whether obtained before or after the date of this Agreement), the
investigation provided for herein and the preparation of this Agreement and
other related documents, and, in the event the transactions contemplated hereby
shall not be consummated, each party will return to the other party or parties
all copies of nonpublic documents and materials which have been furnished in
connection therewith. Without the consent of the Buyer, from and after the
Closing until the second (2nd) anniversary of the Closing Date, the Seller
Parties shall not, and shall cause their Affiliates not to, disclose to any
Person any information concerning the Business that is not already generally
available to the public (“Confidential Information”) for any reason or purpose
whatsoever, except as compelled by applicable Law, as reasonably required to
exercise or enforce any rights under this Agreement or any Ancillary Agreements
(provided that, the Seller Parties shall, and shall cause their Affiliates to,
use their commercially reasonable efforts, at the Buyer’s expense, to limit
public disclosure of any Confidential Information in connection with exercising
its rights, including disclosing such Confidential Information to the court in
chambers or in court in a non-public session or in pleadings filed under seal
where it is reasonably feasible and would not materially prejudice the Seller
Parties or their Affiliate’s rights), or as contemplated by this Agreement or
any Ancillary Agreements. Without limiting the right of either party to pursue
all other legal and equitable rights available to it for violation of this
Section 11.2 by the other party, it is agreed that other remedies cannot fully
compensate the aggrieved party for such a violation of this Section 11.2 and
that the aggrieved party shall be entitled to injunctive relief to prevent a
violation or continuing violation hereof.

 

Section 11.3.     Governing Law. This Agreement and the transactions
contemplated hereby shall be governed by and construed in accordance with the
laws of the State of Delaware without reference to its choice of law rules.

 

 

 
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Section 11.4.     Exclusive Jurisdiction; Court Proceedings. Any claim, action,
suit or proceeding against any party to this Agreement arising out of or in any
way relating to this Agreement shall be brought exclusively in any federal or
state court located in the State of Delaware in New Castle County and each of
the parties hereby submits to the exclusive jurisdiction of such courts for any
such purpose; provided, that a final judgment in any such claim, action, suit or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by Law. Each party
irrevocably and unconditionally agrees not to assert (a) any objection which it
may ever have to the laying of venue of any such claim, action, suit or
proceeding in any federal or state court located in the State of Delaware in New
Castle County, (b) any claim that any such claim, action, suit or proceeding
brought in any such court has been brought in an inconvenient forum and (c) any
claim that such court does not have jurisdiction with respect to such claim,
action, suit or proceeding.

 

Section 11.5.     Notices. All notices and other communications in connection
with this Agreement shall be in writing and shall be deemed given (a) on the
date of delivery if delivered personally or if sent via facsimile (with
confirmation and same day dispatch by express courier utilizing next-day
service), (b) on the earlier of confirmed receipt or the third (3rd) Business
Day following the date of mailing if mailed by registered or certified mail
(return receipt requested), (c) on the first (1st) Business Day following the
date of dispatch if delivered utilizing next-day service by an express courier
(with confirmation) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice) or (d) on the date
such notice is transmitted by e-mail to the e-mail addresses previously provided
to the other parties:

 

If to the Seller Parties:

 

Media General, Inc.
333 E. Franklin Street
Richmond, VA 23219
Attention: President

With a copy to: attention: General Counsel
Facsimile: (804) 887-7021

 

with a copy (which shall not constitute notice) to:

 

Fried, Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
New York, New York 10004
Attention: Philip Richter
Facsimile: (212) 859-4000

 

If to the Buyer, to:

 

WJCL Hearst Television LLC 

c/o Hearst Television Inc.

300 West 57th Street

New York, New York 10019

Attention: President

Facsimile No.: 212-887-6855

 

 

 
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with a copy (which shall not constitute notice) to:

 

The Hearst Corporation

Office of the General Counsel
300 West 57th Street
New York, New York 10019

Attention: General Counsel

Facsimile: (646) 280-2041

 

and

 

Brooks, Pierce, McLendon, Humphrey & Leonard, LLP
150 Fayetteville Street, Suite 1600
Raleigh, NC 27601
Attention: Wade H. Hargrove
Facsimile: 919-839-0304

 

Section 11.6.     Successors and Assigns; Third Party Beneficiaries.

 

(a)     This Agreement and all of its terms shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assigns, including any successor by a merger or conversion referenced below.
Except as expressly provided in this Section 11.6(a), or in Section 6.1(e), this
Agreement shall not be assigned by any party hereto. Any party (including, for
this purpose, any Seller Party) may assign or transfer any of its rights and
obligations under this Agreement to any of its Affiliates upon written notice to
the other party, provided that such assignment is made before the filing of the
FCC Applications and no such assignment or transfer would be reasonably expected
to delay the approval by the DOJ pursuant to the DOJ Final Judgment, and,
provided further, that no such assignment or transfer shall operate to relieve a
party of any of its liabilities or obligations hereunder.

 

(b)      Nothing in this Agreement, expressed or implied, is intended or shall
be construed to confer any right, remedy or claim under or by reason of this
Agreement upon any Person other than the parties hereto and their successors and
assigns permitted by this Section 11.6, and any Persons entitled to
indemnification under Article IX.

 

Section 11.7.     Access to Records after Closing.

 

(a)     For a period of six (6) years after the Closing Date, the Seller Parties
and their representatives shall have reasonable access to all of the books and
records of the Business transferred to the Buyer hereunder to the extent that
such access may reasonably be required by the Seller Parties in connection with
matters relating to or affected by the operations of the Business prior to the
Closing Date. Such access shall be afforded by the Buyer upon receipt of
reasonable advance notice and during normal business hours. The Seller Parties
shall be solely responsible for any costs or expenses incurred by it pursuant to
this Section 11.7(a). If the Buyer shall desire to dispose of any of such books
and records prior to the expiration of such six (6) year period, it shall, prior
to such disposition, give the Seller Parties a reasonable opportunity, at the
Seller Parties' expense, to segregate and remove such books and records as the
other party may select.

 

 

 
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(b)     For a period of six (6) years after the Closing Date, the Buyer and its
representatives shall have reasonable access to all of the books and records
relating to the Business which the Seller Parties or any of their Affiliates may
retain after the Closing Date (including, but not limited to Tax Returns solely
to the extent related to the Purchased Assets or the Business). Such access
shall be afforded by the Seller Parties and their Affiliates upon receipt of
reasonable advance notice and during normal business hours. The Buyer shall be
solely responsible for any costs and expenses incurred by it pursuant to this
Section 11.7(b). If the Seller Parties or any of their Affiliates shall desire
to dispose of any of such books and records prior to the expiration of such
six-(6) year period, such party shall, prior to such disposition, give the Buyer
a reasonable opportunity, at the Buyer’s expense, to segregate and remove such
books and records as the other party may select.

 

Section 11.8.     Entire Agreement; Amendments. This Agreement, the Exhibits and
Schedules referred to herein, the Ancillary Agreements, the Confidentiality
Agreement, and the other documents delivered pursuant hereto contain the entire
understanding of the parties hereto with regard to the subject matter contained
herein or therein, and supersede all prior agreements, understandings or intents
between or among any of the parties hereto. The parties hereto, by mutual
agreement in writing, may amend, modify and supplement this Agreement. No
amendment of any provision of this Agreement shall be valid unless the same
shall be in writing and signed by the parties.

 

Section 11.9.     Interpretation. Article titles and headings to Sections herein
are inserted for convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this Agreement. The Schedules
and Exhibits referred to herein shall be construed with and as an integral part
of this Agreement to the same extent as if they were set forth verbatim herein.
For purposes of this Agreement, (i) the words “include,” “includes” and
“including” shall be deemed to be followed by the words “without limitation,”
(ii) the word “or” is not exclusive, (iii) the words “herein”, “hereof”,
“hereby”, “hereto” and “hereunder” refer to this Agreement as a whole, (iv) the
defined terms in this Agreement shall apply equally to both the singular and
plural forms of the terms defined, and (v) a reference to a Person includes its
agents, successors and permitted assigns. Unless the context otherwise requires,
references herein (a) to Articles, Sections, Exhibits and Schedules mean the
Articles and Sections of, and the Exhibits and Schedules attached to, this
Agreement and (b) to an agreement, instrument or other document means such
agreement, instrument or other document as amended, supplemented and modified
from time to time to the extent permitted by the provisions thereof and by this
Agreement. This Agreement, the Buyer Ancillary Agreements and the Ancillary
Agreements shall be construed without regard to any presumption or rule
requiring construction or interpretation against the party drafting an
instrument or causing any instrument to be drafted. References to a “party
hereto” or the “parties hereto” or similar phrases shall refer to the Seller
Parties and the Buyer.

 

 

 
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Section 11.10.     Waivers. Any term or provision of this Agreement may be
waived, or the time for its performance may be extended, by the party or parties
entitled to the benefit thereof. The failure of any party hereto to enforce at
any time any provision of this Agreement shall not be construed to be a waiver
of such provision, nor in any way to affect the validity of this Agreement or
any part hereof or the right of any party thereafter to enforce each and every
such provision. No waiver of any breach of this Agreement shall be held to
constitute a waiver of any other or subsequent breach.

 

Section 11.11.     Expenses. Except as otherwise expressly provided herein, each
of Seller Parties and the Buyer will pay all of its own respective costs and
expenses incident to its negotiation and preparation of this Agreement and to
its performance and compliance with all agreements and conditions contained
herein on its part to be performed or complied with, including the fees,
expenses and disbursements of its counsel and accountants.

 

Section 11.12.     Partial Invalidity. Wherever possible, each provision hereof
shall be interpreted in such manner as to be effective and valid under
applicable law, but in case any one or more of the provisions contained herein
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provisions of this Agreement, and this Agreement shall be construed as if
such invalid, illegal or unenforceable provision or provisions had never been
contained herein.

 

Section 11.13.     Execution in Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall be considered an original
instrument, but all of which shall be considered one and the same agreement, and
shall become binding when one or more counterparts have been signed by each of
the parties and delivered to each of the Seller Parties and the Buyer.

 

Section 11.14.     Disclaimer of Warranties. No Seller Party makes any
representations or warranties with respect to any projections, forecasts or
forward-looking information provided to the Buyer. There is no assurance that
any projected or forecasted results will be achieved. EXCEPT AS TO THOSE MATTERS
EXPRESSLY COVERED BY THE REPRESENTATIONS AND WARRANTIES IN THIS AGREEMENT AND
THE ANCILLARY AGREEMENTS, THE SELLER PARTIES DISCLAIM ALL OTHER WARRANTIES,
REPRESENTATIONS AND GUARANTIES WHETHER EXPRESS OR IMPLIED. The Buyer
acknowledges that none of the Seller Parties or any of their representatives or
Affiliates nor any other Person has made any representation or warranty, express
or implied, as to the accuracy or completeness of any memoranda, charts,
summaries or schedules heretofore made available by the Buyer or its
representatives or Affiliates or any other information which is not included in
this Agreement or the Schedules hereto, and none of the Seller Parties or any of
their representatives or Affiliates nor any other Person will have or be subject
to any liability to the Buyer, any Affiliate of the Buyer or any other Person
resulting from the distribution of any such information to, or use of any such
information by, the Buyer, any Affiliate of the Buyer or any of their agents,
consultants, accountants, counsel or other representatives. The Buyer disclaims
that it is relying upon or has relied upon any representation or warranty not
included in this Agreement or the Ancillary Agreements that may have been made
by any Person, and acknowledges and agrees that the Seller Parties disclaim any
such other representations and warranties.

 

 

 
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Section 11.15.     WAIVER OF JURY TRIAL. EACH OF THE PARTIES TO THIS AGREEMENT
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

 

Section 11.16.     Specific Performance. The parties agree that irreparable
damage would occur in the event that any provision of this Agreement was not
performed in accordance with its specific terms or was otherwise breached or the
Closing was not consummated, and that money damages would not be an adequate
remedy, even if available. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions, or any other appropriate form of
specific performance or equitable relief, to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof (including the
parties’ obligations to consummate the Closing) in any court of competent
jurisdiction, this being in addition to any other remedy to which they are
entitled at law or in equity. Each of the parties agrees that it will not oppose
the granting of an injunction, specific performance and other equitable relief
on the basis that any other party has an adequate remedy at law or that any
award of specific performance is not an appropriate remedy for any reason at law
or in equity. Any party seeking an injunction or injunctions to prevent breaches
of this Agreement and to enforce specifically the terms and provisions of this
Agreement shall not be required to post any bond or other security in connection
with any such order or injunction.

 

Section 11.17.     Guarantee. As consideration for the benefits that Buyer and
the Buyer Guarantor will receive as a result of Buyer entering into this
Agreement, the Buyer Guarantor hereby agrees that it shall be responsible for
all of the obligations of Buyer (and any Person to whom Buyer assigns any of its
rights or delegates any of its obligations under this Agreement, in whole or in
part) under any of the provisions of this Agreement, and the Buyer Guarantor
hereby guarantees to each of the Seller Parties the due and punctual performance
and payment in full of the Purchase Price, any purchase price adjustment and any
other amounts payable by Buyer or its assignee hereunder. This guaranty by the
Buyer Guarantor is an absolute, unconditional, present and continuing guaranty
of payment and performance (as opposed to a guaranty only of collection) and
each of the Seller Parties (or any of them acting without the other) may enforce
their rights under this guaranty without notice of default or undertaking any
proceeding or filing any cause of action against Buyer (or any Person to whom
Buyer assigns any of its rights or delegates any of its obligations under this
Agreement, in whole or in part). The Buyer Guarantor hereby waives any and all
defenses applicable to a guarantor or a surety under applicable Law in
connection with its obligations under this guaranty and, without limiting the
foregoing, the terms and conditions of the obligations of Buyer (or any Person
to whom Buyer assign any of its rights or delegates any of its obligations under
this Agreement, in whole or in part) under this Agreement may be modified,
amended or supplemented without the consent or approval of the Buyer Guarantor
and the guaranty of the Buyer Guarantor shall continue in full force and effect
as so modified, amended or supplemented.

 

 

 

[Signatures on following page]

 

 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written.

 

 

SELLER PARTIES

 

 

 

 

 

 

 

 

 

 

MEDIA GENERAL, INC.

 

                  By: /s/ James F. Woodward       Name: James F. Woodward      
Title:   Senior Vice President & Chief Financial Officer                    
MERCURY NEW HOLDCO, INC.                     By: /s/ James F. Woodward      
Name: James F. Woodward       Title:   Treasurer                     LIN
TELEVISION CORPORATION                     By: /s/ Richard J. Schmaeling      
Name: Richard J. Schmaeling       Title:   CFO  

 

 

 

 

          LIN LICENSE COMPANY, LLC                     By: /s/ Richard J.
Schmaeling       Name: Richard J. Schmaeling       Title:   CFO  

 

 

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  BUYER                     WJCL HEARST TELEVISION LLC                     By:
/s/ Jordan M. Wertlieb       Name: Jordan M. Wertlieb       Title:   President  
                          BUYER GUARANTOR                     HEARST TELEVISION
INC.                     By: /s/ Jordan M. Wertlieb       Name: Jordan M.
Wertlieb       Title:   President