Exhibit 10.1


 


Execution Copy


 


TAX MATTERS AGREEMENT


 


THIS TAX MATTERS AGREEMENT (“Agreement”), dated as of July 29,
2008, is made by CSC Holdings, Inc., a Delaware corporation (“Cablevision”), NMG Holdings, Inc.,
a newly-formed Delaware corporation and a wholly-owned subsidiary of
Cablevision (“Holdco”);
Cablevision and Holdco are collectively referred to as “Cablevision Parties”), Newsday Holdings LLC, a Delaware limited
liability company (the “Company”), Tribune Company, a Delaware corporation (“Tribune”)
and Newsday, Inc., a New York corporation and direct wholly-owned
subsidiary of Tribune.


 


WHEREAS, pursuant to the Formation Agreement, the Cablevision Parties,
Tribune and certain affiliates of Tribune that are disregarded as entities
separate from Tribune for Federal tax purposes have contributed certain assets
to the Company (or its wholly owned subsidiaries that are disregarded as
entities separate from the Company for Federal tax purposes) in exchange for
membership interests in the Company;


 


WHEREAS, for Federal income tax purposes, it is intended that the
foregoing contributions will be treated as tax-free contributions by the
members to the Company of property under Section 721 of the Code in
exchange for membership interests in the Company;


 


WHEREAS, pursuant to the Formation Agreement, the Company and the
Cablevision Parties have agreed to make certain undertakings to Tribune as
provided herein;


 


NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:


 


1.             Definitions.  All capitalized terms used and not otherwise
defined in this Agreement shall have the meaning set forth in the Formation
Agreement.  As used herein, the following
terms have the following meanings:


 


“Code” means the Internal Revenue Code of 1986, as amended, and
corresponding provisions of any successor law.


 


“Formation Agreement” means that certain Formation Agreement dated as
of May 11, 2008, by and among the Cablevision Parties, Tribune, Newsday, Inc.,
the Company and Newsday LLC.


 


“Indemnitors” means the Company and the Cablevision Parties.


 


“Indirect Owner” means, in the case of a Protected Member that is an
entity that is classified as a partnership, S corporation or disregarded entity
for Federal income tax purposes, any person owning an equity interest in such
Protected Member, and, in the case of any Indirect Owner that itself is an
entity that is classified as a partnership, S corporation or disregarded entity
for Federal income tax purposes, any person owning an equity interest in such
entity.


 

















 


“LLC Debt” means the Debt Financing and any Refinancing Debt.


 


“Make-Whole Payment” means a payment in an amount equal to the sum of
the Base Amount and the Gross-Up Amount, as those terms are defined in Section 3
hereof.


 


“Melville Contribution Agreement” has the meaning set forth in that
certain Melville Lease.


 


“Melville Debt Financing” has the meaning set forth in the Limited
Liability Company Agreement of the Company.


 


“Melville Lease” has the meaning set forth in the Formation Agreement.


 


“Melville Real Property” has the meaning set forth in the Formation
Agreement.


 


 “Membership Interests” means
membership interests in the Company.


 


“Minimum Debt Amount” means, with respect to the periods set forth on
Schedule A hereof, LLC Debt with an outstanding principal amount as set forth
on Schedule A hereof.


 


“Newsday Assets” has the meaning set forth in the Formation Agreement.


 


“Protected Member” means Newsday, Inc., a New York corporation,
Tribune and any permitted successors or assigns.


 


“Protected Period” means the period beginning on the Closing Date and
ending on January 1, 2018.


 


“Protected Properties” means each of the Newsday Assets that was owned
by Tribune and its Affiliates on December 31, 2007, and any property
acquired by the Company or any entity in which the Company holds a direct or
indirect interest in exchange for any such Protected Property that is “substituted
basis property” as defined in Section 7701(a)(42) of the Code with respect
to any such Protected Property.


 


“Refinancing Debt” means debt treated as indebtedness for Federal
income tax purposes that meets all of the following conditions:  The debt is (i) allocable under the rules of
Treasury Regulations Section 1.163-8T to payments discharging all or part
of the Debt Financing or an earlier Refinancing Debt; (ii) owed by the
Company (or an entity that is disregarded as an entity separate from the
Company for Federal income tax purposes) to a person that is not related within
the meaning of Treasury Regulations Section 1.752-4(b) to any Member
of the Company, (iii) guaranteed by Cablevision (or a permitted successor
to Cablevision’s interest in the Company) and/or one or more of its Affiliates
and not by any other person, and (iv) is subject to an indemnification
obligation substantially in the form of the Tribune Indemnification Agreement
in favor of such guarantor(s).  Any
indebtedness that would be Refinancing Debt but for Tribune’s breach of its
obligation under Section 6 hereof shall constitute Refinancing Debt.


 


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“S corporation” has the meaning ascribed thereto in Section 1361(a)(1) of
the Code.


 


“Special Distribution Amount” has the meaning set forth in the
Formation Agreement.


 


“Treasury
Regulations” means final and temporary regulations promulgated under the
Code.


 


“Trigger Event” shall have the meaning set forth in Section 3(a) hereof.


 


2.             Restrictions on Triggering Tax
Gain


 


(a)


 


(i)            At
all times throughout the Protected Period, the Company agrees, for the benefit
of each Protected Member and the Indirect Owners of such Protected Member, that
neither the Company nor any entity in which the Company holds a direct or
indirect interest will directly or indirectly sell, transfer, exchange, or
otherwise dispose of any Protected Property in a taxable transaction for
Federal income tax purposes (including for this purpose a transaction described
in Section 704(c)(1)(B) or Section 737 of the Code).


 


(ii)           Section 2(a)(i) hereof
shall not apply with respect to a sale, transfer, exchange or other disposition
of Protected Property as a result of an involuntary conversion within the
meaning of Section 1033 of the Code, and the Company shall have no
obligation to replace such Protected Property in a manner that allows the gain
to be deferred under section 1033 of the Code, but if such Protected Property
is in fact replaced in a manner that would allow the gain to be deferred under
Code Section 1033, the Company shall elect under Code Section 1033 to
defer such gain.


 


(iii)          Section 2(a) (i) hereof
shall not apply with respect to the sale, transfer, exchange or other
disposition  of inventory or other assets
in the ordinary course of operating the business of the Company and its
Subsidiaries, provided that the total amount of “recognized built-in gain”
(within the meaning of Section 1374(d)(3) of the Code) with respect
to such dispositions (other than dispositions of inventory) excluded pursuant
to this Section 2.1(a)(iii) shall not exceed One Million Dollars
($1,000,000) in any taxable year of the Company.


 


(b)           At
all times throughout the Protected Period, the Company agrees, for the benefit
of each Protected Member and the Indirect Owners of such Protected Member, to
maintain, on a continuous basis, an amount of LLC Debt equal to the Minimum
Debt Amount.


 


3.             Indemnity for Breach of
Obligations Set Forth in Section 2


 


(a)


 


(i)            In
the event that the Company breaches its obligation set forth in Section 2 hereof
to any Protected Member or an Indirect Owner thereof (a Trigger Event”), 


 


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Indemnitors shall be jointly and severally
obligated to pay to such Protected Member and Indirect Owner as damages an
amount (the “Base Amount”) equal to the aggregate Federal, state and local
income taxes incurred by such Protected Member or Indirect Owner thereof as a
result of the income and gain recognized by or allocated under Section 704(c) of
the Code (to the extent based upon the difference between fair market value and
adjusted basis of the Newsday Assets on the Closing Date, and without regard to
income or gain in excess of such built-in gain) to such Protected Member or
Indirect Owner thereof by reason of such Trigger Event plus an additional
amount (the “Gross-Up Amount”) so that, after the payment by such Protected
Member or Indirect Owner thereof of all taxes on amounts received pursuant to
this Section 3(a), such Protected Member or Indirect Owner thereof retains
an amount equal to the Base Amount.  In
the event that Indemnitors become aware of a breach of Section 2 hereof
with respect to the  Protected Member or
an Indirect Owner thereof, Indemnitors shall promptly notify such Protected
Member in writing of such Trigger Event and of the sales price or other amount
realized for income tax purposes in connection therewith, or the amount by
which the Minimum Debt Amount exceeded the outstanding principal amount of LLC
Debt and shall provide the Protected Member with copies of all operative
documents relating to the Trigger Event and such other relevant materials as
may be reasonably requested by the Protected Member.


 


(ii)           Upon
receipt of such notice, the Protected Member shall provide Indemnitors with any
information reasonably requested by Indemnitors of the Protected Member
(including information regarding Indirect Owners thereof) to enable Indemnitors
to verify the computation of the Make-Whole Payment within thirty (30) days of
such request.


 


(iii)          In
addition, the Protected Member  shall
prepare a computation of the Make-Whole Payment owing to such Protected Member
or Indirect Owner under this Section 3, which computation shall be
delivered to Indemnitors within sixty (60) days after the Protected Member
receives notice of the breach pursuant to section 3(a)(i) hereof, but in
no event earlier than thirty (30) days after the Indemnitors provide the
Protected Member with any information previously reasonably requested by the
Protected member.  Indemnitors shall make
any required Make-Whole Payment owing to the Protected Member or Indirect Owner
pursuant to this Section 3 no later than ten (10) days after delivery
by the Protected Member of such computation, or if the Indemnitors do not agree
with such computation, within ten (10) days after resolution of such
disagreement pursuant to section 3(g) hereof.


 


(b)           For
purposes of determining the amount of the Make-Whole Payment payable by
Indemnitors:


 


(i)            In
the case of a Protected Member or Indirect Owner that is an individual, (a) all
income arising from a transaction or event that is treated as ordinary income
under the applicable provisions of the Code and all payments under this Section 3
shall be treated as subject to Federal and New York state income tax at an
effective tax rate imposed on ordinary income of nonresidents of New York State
(and without regard to state-of-residence taxes), determined using the maximum
Federal rate of tax on ordinary income and the maximum New York state rates of
tax on ordinary income then in effect, adjusted to reflect the deductibility of
state taxes for federal income tax purposes, (b) all other income arising
from the 


 


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transaction or event shall be subject to
Federal and New York state income tax at the effective tax rate imposed on
long-term capital gains of nonresidents of 
New York State (and without regard to state-of-residence taxes),
determined using the maximum Federal and New York State rates on long-term
capital gains then in effect (including for this purpose with respect to any
Code Section 1245 or 1250 recapture, the maximum rate imposed on such
income), adjusted to reflect the deductibility of state taxes for federal
income tax purposes, and (c) any amounts giving rise to a payment pursuant
to section 3(a) hereof will be determined assuming that the Trigger Event
was the only transaction or event reported on the Protected Member’s or
Indirect Owner’s tax return (i.e., without giving effect to any loss carry
forwards or other deductions attributable to such Protected Member or Indirect
Owner).


 


(ii)           In
the case of a Protected Member that is a partnership or disregarded entity for
Federal income tax purposes, section 3(b)(i) hereof shall be applied
treating each Indirect Owner of such partnership or disregarded entity as if it
were directly a Protected Member, and in the case Protected Member or Indirect
Owner that is a C corporation (within the meaning of Section 1361(a)(2) of
the Code), section 3(b)(i) hereof shall be applied using the highest
marginal rate of tax applicable to corporations for Federal income tax purposes
and New York State corporate income or franchise tax purposes, adjusted to
reflect the deductibility of state taxes for federal income tax purposes.


 


(c)           If
a Trigger Event occurs in a taxable year for which Tribune is an S corporation
(within the meaning of Section 1361(a)(1) of the Code):


 


(i)            The
Base Amount payable to Tribune shall equal (a) the amount of “built-in
gains tax” under Section 1374 of the Code and payable by Tribune as a
result of such Trigger Event assuming the application of the highest Federal
tax rates applicable to such gain and that Tribune’s “net recognized built-in
gain” for such year equals the amount of “recognized built-in gain” triggered
by such event plus, (b) any state tax payable as a result of such Trigger
Event determined by applying a 6.5% state tax rate applicable to the amount of
built-in gain as determined under Section 3(c)(i)(a) hereof and
making the same assumption regarding the amount of “net recognized built-in
gain.”


 


(ii)           No
Gross-Up Amount shall be payable to the extent that the receipt of the Base
Amount by Tribune does not give rise to “recognized built-in gain” under Section 1374
of the Code.


 


(iii)          The
amount of any Make-Whole Payment payable to any shareholder or other Indirect
Owner of Tribune shall be zero.


 


(iv)          For
purposes of this section 3(c), Tribune shall be deemed to include any of its
qualified subchapter S subsidiaries as defined in Section 1361(b)(3) of
the Code.


 


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(d)           In
the case of a Protected Member or Indirect Owner that is not an
S corporation, the amount of the Make-Whole Payment shall be reduced by an
amount equal to the present value (calculated using a discount rate of  ten percent (10%) per annum, compounded
annually) as of the last day of the taxable year in which the additional tax
liability is incurred of an amount equal to the Make-Whole Payment (determined
without regard to this Section 3(d)) payable on the tenth anniversary of
the date of this Agreement.


 


(e)           Notwithstanding
anything to the contrary herein, if a Trigger Event occurs in a taxable year in
which Tribune is not the sole Protected Member or is not an S corporation
wholly-owned by one or more tax-exempt entities, the aggregate Make-Whole
Payments made to all Protected Members and Indirect Owners shall not exceed the
Make-Whole Payment that would have been due to Tribune if it were at all times
the sole Protected Member and an S corporation wholly-owned by one or more
tax-exempt entities.


 


(f)            The
sole and exclusive rights and remedies of 
a Protected Member (or Indirect Owner thereof) for a breach or violation
of the covenants set forth in Section 2 shall be a claim for money indemnification
against Indemnitors in the form of the Make-Whole Payment, computed as set
forth in Section 3, and no Protected Member (or Indirect Owner) shall be
entitled to pursue a claim for specific performance of the covenant set forth
in Section 2 or bring a claim against any person that acquires a Protected
Property from the Company in violation of Section 2.  No Protected Member or Indirect Owner shall
have any right to indemnification by Indemnitors for taxes other than as
provided in this Agreement.


 


(g)           If
the Company has breached or violated the covenant set forth in Section 2
(or a Protected Member (or Indirect Owner thereof) asserts that the Company has
breached or violated the covenant set forth in Section 2),
Indemnitors  and the Protected Member
agree to negotiate in good faith to resolve any disagreements regarding any
such breach or violation and the amount of damages, if any, payable to such
Protected Member or Indirect Owner under this Section 3, including the
amount of built-in gain under Sections 1374 and 704(c) of the Code to
report on the tax returns to be filed by the parties hereto as a result of the
Trigger Event.  If any such disagreement
as to tax and Make-Whole Payment calculations cannot be resolved by the Company
and such Protected Member within thirty (30) days after the delivery by the
Protected Member of the computation referred to in section 3(a)(iii) hereof,
Indemnitors and the Protected Member shall jointly retain a nationally
recognized independent public accounting firm (the “Accounting Firm”) to act as
an arbitrator to resolve as expeditiously as possible all points of any such
disagreement (including, without limitation, whether a breach of the covenant
set forth in Section 2 hereof has occurred and, if so, the amount of Make-Whole
Payment to which the Protected Member (or Indirect Owner thereof) is entitled
as a result thereof, determined as set forth in this Section 3).  All determinations made by the Accounting
Firm with respect to the resolution of any breach or violation of the covenant
set forth in Section 2  hereof and
the amount of damages payable to the Protected Member (or Indirect Owner
thereof) under this Section 3 shall be final, conclusive and binding on
Indemnitors and the Protected Member. The fees and expenses of the Accounting
Firm incurred in connection with any such determination shall be borne by the
Company.  In the event that Indemnitors
and the Protected Member, each 


 


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having acted in good faith and with its best
efforts to select an Accounting Firm, are unable to retain an Accounting Firm
within sixty (60) days after the thirty (30) day period mentioned above, then
following the expiration of such sixty (60) day period, any disagreement may be
settled in any court of competent jurisdiction, subject to Section 7
hereof.


 


4.             Section 704(c) Method;
Nonrecourse Liability Allocation Method. 
The Company shall use, and shall cause any other entity in which the
Company has a direct or indirect interest to use the “remedial method” under
Regulations Section 1.704-3(d) for purposes of making allocations
under Section 704(c) of the Code with respect to each of the Newsday
Assets pursuant to  Treasury Regulations
Sections 1.704-1(b)(2)(iv)(f), 1.704-1(b)(2)(iv)(g), and 1.704-3(a)(6).  Except as provided in the preceding sentence,
the Company shall use, and shall cause any other entity in which the Company
has a direct or indirect interest to use, any permissible method selected by
the Cablevision Parties for purposes of making allocations under Section 704(c) of
the Code with respect to all other property contributed to the Company and with
respect to any revaluation of property (excluding the Newsday Assets) pursuant
to Treasury  Regulations Sections
1.704-1(b)(2)(iv)(f), 1.704-1(b)(2)(iv)(g), and 1.704-3(a)(6).  “Excess nonrecourse liabilities” within the
meaning of Treasury  Regulations Section 1.752-3(a)(3) shall
be allocated in accordance with Percentage Interests (as defined in the Company
Operating Agreement).


 


5.             Certain Tax Reporting


 


(a)           For
Federal, state and local income tax purposes, the Contributions to the Company
pursuant to Section 1.1 of the Formation Agreement shall be reported by
all parties hereto as nontaxable pursuant to Section 721(a) of the
Code and the distribution of the Special Distribution Amount pursuant to Section 1.2
of the Formation Agreement shall be treated as a nontaxable distribution to a
partner pursuant to Section 731 of the Code and Treasury Regulations Section 1.707-5(b) without
separate disclosure pursuant to Section 6662(d)(2)(B)(ii) or any
other provision of the Code or Treasury Regulations or similar provisions of
state and local law except as required by a change in law after the date
hereof.


 


(b)           Pursuant
to Notice 89-35, 1989-1 C.B. 675, for purposes of applying the interest tracing
rules of Treasury Regulations Section 1.163-8T, the Company shall
treat the distribution of the Special Distribution Amount as being made from
the proceeds of the Debt Financing. Interest expense on such proceeds shall be
allocated in accordance with the general allocation rule of section V.A.
of Notice 89-35.


 


(c)           Except
with respect to any Refinancing Debt described in the last sentence of the
definition of Refinancing Debt, all tax returns filed by the Company shall
report the outstanding principal amount of all LLC Debt as a recourse liability
allocable solely to the Protected Members except as required by a change in law
after the date hereof.


 


(d)           As
promptly as practicable after the date hereof, the parties shall cooperate in
preparing schedules showing (i) the amount of net unrealized built-in gain
within the meaning of Section 1374 of the Code with respect to the
Protected Property as of December 31, 2007 and 


 


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the allocation of such built-in gain among
items of such Protected Property and (ii) the amount of built-in gain
within the meaning of Section 704(c) of the Code with respect to the
Newsday Assets as of Closing and the allocation of such built-in gain among the
Newsday Assets.  The parties shall file
their tax returns in a manner consistent with such schedule.


 


6.             Refinancing
Debt.  Tribune shall enter into an
indemnification obligation as described in paragraph (iv) of the
definition of Refinancing Debt extending at least through the end of the
Protected Period with respect to any indebtedness that meets the requirements
of paragraphs (i) through (iii) of the definition of Refinancing
Debt.


 


7.             Tax
Contests


 


(a)           In
the event that the Internal Revenue Service or any other tax authority asserts
a claim or raises an issue in the course of an audit or other tax proceeding
involving a Protected Member or Indirect Owner that could result in an
obligation of Indemnitors to make a Make-Whole Payment (or increase the amount
of any Make-Whole Payment), the Protected Member or Indirect Owner shall
promptly notify Indemnitors.  Indemnitors
shall have the right to contest, at their own expense, any such claim or issue
through appropriate administrative and judicial proceedings, and the Protected
Member or Indirect Owner shall cooperate with Indemnitors in connection with
the conduct of any such contest and shall not settle or otherwise compromise
such contest without the consent of Indemnitors.


 


In the event that the Internal Revenue Service or any other taxing
authority makes a claim or raises an issue in any partnership-level audit or
other proceeding of the Company which could result in disallowance of the tax
treatment set forth in Section 5(a) hereof, the Company shall
promptly notify Tribune.  Tribune shall
have the right to contest, at its own expense, any such claim or issue through
appropriate administrative or judicial proceedings, and the Indemnitors shall
cooperate with Tribune in connection with the conduct of any such contest and
shall not settle or otherwise compromise such contest without the consent of
Tribune.


 


8.             Governing
Law.  This Agreement and any disputes
arising hereunder or controversies related hereto shall be governed by and construed
in accordance with the laws of the State of Delaware applicable to contracts
made and performed in such State without regard to any choice or conflict of
law provision or rule (whether of the State of Delaware or any other
jurisdiction) to the extent they would result in the application of the laws of
another jurisdiction.


 


9.             Submission to Jurisdiction;
Consent to Service of Process


 


(a)           Any
Action with respect to this Agreement, any matter arising out of or in
connection with this Agreement shall be brought exclusively in the state or
federal courts sitting in the state of Delaware.  By execution and delivery of this Agreement,
each party hereto hereby accepts for itself and in respect of such party’s
property, generally and unconditionally, the sole and exclusive jurisdiction of
the aforesaid courts and appellate courts thereof.  Each party hereto hereby irrevocably and
unconditionally waives any objection which such party may now or hereafter have
to the laying of venue of any of the aforesaid actions or proceedings arising
out of 


 


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or in connection with this Agreement brought
in the courts referred to above and hereby further irrevocably waives and
agrees, to the extent permitted by applicable law, not to plead or claim in any
such court that any such Action brought in any such court has been brought in
an inconvenient forum.  Nothing herein
shall affect the right of any party hereto to serve process in any other manner
permitted by law.  Notwithstanding
anything in this Section 8(a) to the contrary, each party agrees that
a final judgment in any such Action shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law.  For purposes of this Section 8,
“Action” shall mean any pending action (at law or in equity), suit,
arbitration, or proceeding.


 


(b)           Each
of the parties hereto irrevocably consents to service of process in any of the
aforementioned courts by the mailing of copies thereof by registered or
certified mail, postage prepaid, or by recongnized overnight delivery service,
to such party at such party’s address referred to in Section 10.


 


10.           Entire
Agreement; Amendments and Waivers. 
This Agreement (including any the schedules and exhibits hereto)
contains the entire agreement by and between the parties hereto with respect to
the subject matter hereof and all prior negotiations, writings and
understandings relating to the subject matter of this Agreement, are merged in
and are superseded and cancelled by, this Agreement.  This Agreement may not be modified or amended
except by an instrument or instruments in writing signed by Cablevision,
Holdco, the Company and Tribune.  Any
party hereto may, only by an instrument in writing, waive compliance by any
other party or parties hereto with any term or provision hereof on the part of
such other party or parties hereto to be performed or complied with.  No failure or delay of any party in
exercising any right or remedy hereunder shall operate as a waiver thereof, nor
will any single or partial exercise of any right or power, or any abandonment
or discontinuance of steps to enforce such right or power, preclude any other
or further exercise thereof or the exercise of any other right or power.  The waiver by any party hereto of a breach of
any term or provision hereof shall not be construed as a waiver of any
subsequent breach.  The rights and
remedies of the parties hereunder are cumulative and are not exclusive of any
rights or remedies that they would otherwise have hereunder.  In the event any provision in any other
Transaction Agreement shall in any way conflict with the provisions of this
Agreement (except where a provision therein expressly provides that it is
intended to take precedence over this Agreement), this Agreement shall control.


 


11.           Notices.  All notices and other communications
hereunder will be in writing and given by certified or registered mail, return
receipt requested, nationally recognized overnight delivery service, such as
Federal Express or facsimile (or like transmission) with confirmation of
transmission by the transmitting equipment or personal delivery against receipt
to the party to whom it is given, in each case, at such party’s address or
facsimile number set forth below or such other address or facsimile number as
such party may hereafter specify by notice to the other parties hereto given in
accordance herewith.  Any such notice or
other communication shall be deemed to have been given as of the date so
personally delivered or transmitted by facsimile or 


 


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like transmission (with confirmation of
receipt), on the next Business Day when sent by overnight delivery services or
five days after the date so mailed if by certified or registered mail.


 


If to the Cablevision Parties or the Company,
to:


 


c/o Cablevision Systems Corporation

1111 Stewart Avenue 

Bethpage, NY  11714

Facsimile No.:  (516) 803-2577

Attention:  General Counsel


 


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


 


Hughes Hubbard & Reed LLP

One Battery Park Plaza

New York, New York  10004

Facsimile No.: (212) 422-4726

Attention: Kenneth A. Lefkowitz


 


If to any of the Tribune Parties, to:


 


Tribune Company

435 North Michigan Avenue

Chicago, Illinois

Facsimile No.:  (312) 222-4206

Attention:  General Counsel


 


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


 


McDermott Will & Emery LLP

600 13th Street, N.W.

Washington, D.C. 20005

Facsimile No.:  (202) 756-8087

Attention:          Blake D. Rubin and
                             Andrea M. Whiteway


 


12.           Severability.  Any provision hereof that is held to be
invalid, illegal or unenforceable in any respect by a court of competent
jurisdiction, shall be ineffective only to the extent of such invalidity,
illegality or unenforceability, without affecting in any way the remaining
provisions hereof, so long as the economic or legal substance of the
transaction, contemplated by this Agreement is not affected in any manner
materially adverse to any party; provided, however, that the
parties will attempt in good faith to reform this Agreement in a manner
consistent with the intent of any such ineffective provision for the purpose of
carrying out such intent.


 


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13.           Binding
Effect; Third-Party Beneficiaries. 
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.  This Agreement is not intended to confer upon
any person not a party hereto (or their successors and permitted assigns),
except with respect to Indirect Owners, who are intended third-party
beneficiaries, any rights or remedies hereunder.  No Protected Member or Indirect Owner other
than Tribune shall have any right under this Agreement (including any right to
receive Make-Whole Payments) unless such Protected Member or Indirect Owner
agrees in writing to be bound by all the provisions of this Agreement and all
Protected Members (including Tribune) and Indirect Owners agree in writing upon
the allocation among themselves of Make-Whole Payments in a manner consistent
with Section 3(e).


 


14.           Assignment.  No party hereto may assign its rights or
delegate its obligations hereunder, directly or indirectly (by operation of law
or otherwise), without the prior written approval of the other parties hereto
and any purported assignment or delegation in violation of this Agreement shall
be null and void ab initio; provided however, that a permitted assignee
or transferee of a Protected Member’s Membership Interest may be assigned such
Protected Member’s rights under this Agreement without such prior written
approval.  No transfer or assignment,
whether permitted or otherwise, of any party’s Membership Interest shall
operate to relieve any party of its obligations hereunder.


 


15.           Neutral
Construction.  With regard to each
and every term and condition of this Agreement and any and all agreements and
instruments subject to the terms hereof, the parties hereto understand and
agree that the same have been mutually negotiated, prepared and drafted, and if
at any time the parties hereto desire or are required to interpret or construe
any such term of condition of this Agreement or any agreement or instrument
subject hereto, no consideration will be given to which party hereto actually prepared,
drafted or requested any term or condition of this Agreement or any agreement
or instrument subject hereto.  Any
reference to any law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise.


 


16.           Counterparts.  This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, all
of which shall be considered one and the same agreement, and will become
effective when one or more counterparts have been signed by a party and
delivered to the other parties.  Copies
of executed counterparts transmitted by telecopy, telefax or other electronic
transmission service shall be considered original executed counterparts for
purposes of this Section 16, provided that receipt of copies of such
counterparts is confirmed.


 


17.           Waiver
of Jury Trial.  EACH PARTY HERETO,
FOR ITSELF AND ITS AFFILIATES, HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THE ACTIONS OF THE PARTIES HERETO OR THEIR RESPECTIVE AFFILIATES
PURSUANT TO THIS AGREEMENT OR IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT HEREOF.  .  


 


11

















 


THE PARTIES AGREE THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.  WITHOUT LIMITING THE FOREGOING, THE PARTIES
FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY
OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER
PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF.  THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.


 


18.           Melville
Real Property.  In the event that the
Melville Real Property is contributed to the Company pursuant to the terms
of the Melville Lease and the Melville Contribution Agreement, the Cablevision
Parties and Tribune shall cooperate in good faith to amend this Agreement to
provide that (i) the Melville Real Property is included as a
Protected Property hereunder; (ii) subject to Section 18(iii) hereof,
Tribune and the Cablevision Parties shall have rights and obligations with
respect to the Melville Real Property that are identical to the
rights and obligations that Tribune and the Cablevision Parties have with
respect to Protected Property under this Agreement as of the date hereof, and (iii) the
Minimum Debt Amount for the applicable period in which the closing on the
contribution of the Melville Real Property occurs shall be increased by the
amount of the Melville Debt Financing, and Schedule A shall be amended
accordingly, and that Schedule A shall be amended to reflect reductions in the
Minimum Debt Amount with respect to the Melville Debt Financing in an amount
and on a schedule to be agreed upon by Tribune and Cablevision Parties, each in
their sole discretion.


 


** REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
**


 


12
















 


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first written above.


 


 


	
   

  	
  CSC HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas M. Rutledge

  
	
   

  	
   

  	
  Name: Thomas M. Rutledge

  
	
   

  	
   

  	
  Title: Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NMG HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas M. Rutledge

  
	
   

  	
   

  	
  Name: Thomas M. Rutledge

  
	
   

  	
   

  	
  Title: Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NEWSDAY HOLDINGS LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas M. Rutledge

  
	
   

  	
   

  	
  Name: Thomas M. Rutledge

  
	
   

  	
   

  	
  Title: Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TRIBUNE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chandler Bigelow III

  
	
   

  	
   

  	
  Name: Chandler Bigelow III

  
	
   

  	
   

  	
  Title: Authorized Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NEWSDAY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chandler Bigelow III

  
	
   

  	
   

  	
  Name: Chandler Bigelow III

  
	
   

  	
   

  	
  Title: Authorized Officer

  



 


[Signature Page to Tax Matters Agreement]


 


13

















 


Schedule A


 


Minimum Debt Amount


 


	
  Period

  	
   

  	
  Minimum Debt Amount

  	
   

  
	
  Period from Closing through Third
  Anniversary of Closing

  	
   

  	
  $

  	
  650 Million

  	
   

  
	
  After Third Anniversary of Closing through
  Fourth Anniversary of Closing

  	
   

  	
  $

  	
  530 Million

  	
   

  
	
  After Fourth Anniversary of Closing through
  Fifth Anniversary of Closing

  	
   

  	
  $

  	
  495 Million

  	
   

  
	
  After Fifth Anniversary of Closing through
  Sixth Anniversary of Closing

  	
   

  	
  $

  	
  460 Million

  	
   

  
	
  After Sixth Anniversary of Closing through
  Seventh Anniversary of Closing

  	
   

  	
  $

  	
  425 Million

  	
   

  
	
  After Seventh Anniversary of Closing
  through Eighth Anniversary of Closing

  	
   

  	
  $

  	
  390 Million

  	
   

  
	
  After Eighth Anniversary of Closing through
  Ninth Anniversary of Closing

  	
   

  	
  $

  	
  355 Million

  	
   

  
	
  After Ninth Anniversary of Closing through
  January, 1, 2018

  	
   

  	
  $

  	
  320 Million