<PAGE>
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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                           ---------------------------

                                    FORM 10-K

[X]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996    COMMISSION FILE NUMBER 333-09529
                           ---------------------------
                       BENEDEK COMMUNICATIONS CORPORATION

             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
                           ---------------------------

                DELAWARE                                36-4076007
      (STATE OR OTHER JURISDICTION OF                (I.R.S. EMPLOYER
       INCORPORATION OR ORGANIZATION)               IDENTIFICATION NO.)
                           ---------------------------

     100 PARK AVENUE                                               61101
    ROCKFORD, ILLINOIS                                         (ZIP CODE)
 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

        REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 815-987-5350

                           ---------------------------

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                                     NAME OF EACH EXCHANGE
        TITLE OF EACH CLASS                           ON WHICH REGISTERED:
        -------------------                          ---------------------
                NONE                                          NONE

               SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                          NONE

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934 during the  preceding  12 months,  and (2) has been  subject to such filing
requirements for the past 90 days. Yes   X     No
                                       -----      -----

     Indicate by check mark if disclosure of delinquent  filers pursuant to item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

     100% of the  voting  common  stock of the  registrant  is  owned by Mr.  A.
Richard Benedek and none of the voting common stock of the registrant is held by
non-affiliates.

     Indicate  the  number of  shares  outstanding  of each of the  registrant's
classes of common stock, as of the latest  practicable  date: At March 21, 1997,
there were outstanding 7,030,000 shares of common stock, $0.01 par value.

                   DOCUMENTS INCORPORATED BY REFERENCE: None.
--------------------------------------------------------------------------------




<PAGE>



                       BENEDEK COMMUNICATIONS CORPORATION

                               INDEX TO FORM 10-K
<TABLE>
<CAPTION>

    ITEM
   NUMBER                                                                                                           PAGE
   ------                                                                                                           ----
                                                              PART I
   <S>               <C>                                                                                             <C>
    Item           1. Business...............................................................................         1
    Item           2. Properties.............................................................................        25
    Item           3. Legal Proceedings......................................................................        28
    Item           4. Submission of Matters to a Vote of Security Holders....................................        28

                                                              PART II

    Item           5. Market for Registrant's Common Equity and Related Stockholder Matters..................        29
    Item           6. Selected Consolidated Financial Data...................................................        29
    Item           7. Management's Discussion and Analysis of Financial Condition and Results of
                      Operations.............................................................................        31
    Item           8. Financial Statements and Supplementary Data............................................        40
    Item           9. Changes in and Disagreements with Accountants on Accounting and Financial
                      Disclosure.............................................................................        40

                                                             PART III

    Item          10. Directors and Executive Officers of the Registrant.....................................        41
    Item          11. Executive Compensation.................................................................        43
    Item          12. Security Ownership of Certain Beneficial Owners and Management.........................        44
    Item          13. Certain Relationships and Related Transactions.........................................        45

                                                              PART IV

    Item          14. Exhibits, Financial Statement Schedules and Reports on Form 8-K........................        46
   Signatures................................................................................................        50

</TABLE>



<PAGE>


                                     PART I

ITEM 1.  BUSINESS.

     This Annual Report on Form 10-K contains  forward-looking  statements  that
involve risks and  uncertainties.  Actual results could differ  materially  from
those  anticipated  in these  forward-looking  statements as a result of certain
factors,  including changes in national and regional  economies,  competition in
the television business, successful integration of acquired television stations,
pricing  fluctuations  in local and national  advertising,  program  ratings and
changes in programming costs, among other factors.

     Except as otherwise provided, the financial data set forth below is derived
from the historical financial statements of Benedek  Communications  Corporation
(the  "Company")  prepared in  accordance  with  generally  accepted  accounting
principles. Such historical financial data includes the results of operations of
five  television  stations  acquired  from  Stauffer  Communications,  Inc. (the
"Stauffer  Stations")  and eight  television  stations  acquired from  Brissette
Broadcasting  Corporation  (the  "Brissette  Stations,"  and  together  with the
Stauffer  Stations,  the "Acquired  Stations")  from the date of the acquisition
thereof on June 6, 1996.  As used  herein,  "Same  Station"  data  refers to the
historical  results of operations of all 22 television  stations currently owned
by the  Company as if such  stations  were owned by the Company  throughout  the
periods with pro forma adjustments only for corporate expenses, depreciation and
amortization.  The "Benedek Stations" refers to the existing nine stations owned
by the Company before the June 6, 1996 acquisitions.

     As used herein,  "Adjusted  EBITDA" is defined as operating  income  before
financial income as derived from the consolidated  statements of operations plus
depreciation  and  amortization,  amortization of program  broadcast  rights and
noncash  compensation  less  payments for program  broadcast  rights.  "Adjusted
EBITDA" as defined in the Company's Credit Agreement excludes from the foregoing
definition  certain noncash revenues used in determining  operating  income.  As
used herein,  "broadcast cash flow" is defined as Adjusted EBITDA plus corporate
expenses.  Adjusted  EBITDA and broadcast cash flow are measures used by certain
investors to measure a company's  ability to service debt.  Adjusted  EBITDA and
broadcast  cash flow should not be  considered  as a substitute  for measures of
performance   prepared  in  accordance   with  generally   accepted   accounting
principles.

GENERAL

     The Company owns 22 network-affiliated television stations (the "Stations")
in the United  States.  The  Stations  are  diverse in  geographic  and  network
affiliation,  serve small to medium-sized  markets and, in the aggregate,  reach
communities in 24 states.  Twelve of the Stations are  affiliated  with CBS, six
are affiliated with ABC and four are affiliated with NBC.

     On June 6, 1996, the Company  acquired  substantially  all of the broadcast
television assets (including  working capital of approximately  $1.6 million) of
Stauffer   Communications,   Inc.  ("Stauffer")  consisting  of  five  principal
broadcast  television stations and four satellite broadcast  television stations
for a purchase price of $54.5 million.  The principal  stations  acquired by the
Company were KCOY-TV, Santa Maria, California; WIBW-TV, Topeka, Kansas; KMIZ-TV,
Columbia,  Missouri;  KGWC-TV, Casper, Wyoming; and KGWN- TV, Cheyenne, Wyoming.
KGWC-TV operates two satellite stations,  KGWL-TV, Lander, Wyoming, and KGWR-TV,
Rock Springs,  Wyoming,  both of which  rebroadcast  the programming of KGWC-TV.
KGWN- TV operates two satellite stations,  KSTF-TV,  Scottsbluff,  Nebraska, and
KTVS-TV, Sterling, Colorado, both

                                       -1-



<PAGE>



of which  rebroadcast the programming of KGWN-TV.  All of the Stauffer  Stations
are  affiliated  with CBS,  except for  KMIZ-TV,  Columbia,  Missouri,  which is
affiliated with ABC.

     On June 6, 1996, the Company acquired all of the capital stock of Brissette
Broadcasting Corporation  ("Brissette") for $270.0 million in cash and preferred
stock. By acquiring all of the capital stock of Brissette,  the Company acquired
eight   network-affiliated   television  stations  including  WMTV-TV,  the  NBC
affiliate  serving  Madison,  Wisconsin;  WWLP-TV,  the  NBC  affiliate  serving
Springfield,   Massachusetts;   WILX-TV,  the  NBC  affiliate  serving  Lansing,
Michigan; WHOI-TV, the ABC affiliate serving Peoria, Illinois; WSAW- TV, the CBS
affiliate  serving  Wausau,  Wisconsin;   WTRF-TV,  the  CBS  affiliate  serving
Wheeling,  West  Virginia and  Steubenville,  Ohio;  KAUZ-TV,  the CBS affiliate
serving Wichita Falls,  Texas;  and KOSA-TV,  the CBS affiliate  serving Odessa,
Texas.

     The  Company  believes  that the  television  industry  is in a  period  of
consolidation  as a  result  of  which a  relatively  small  number  of  station
operators  will emerge as the leading  television  station  group  owners in the
United   States.   Recent   telecommunications   legislation   that   eliminates
restrictions on the number of television  stations that any individual or entity
may own so long as the aggregate  audience reach does not exceed 35% of all U.S.
households is likely to accelerate this trend. The Company's growth strategy, of
which the  acquisition  of the Stauffer  Stations and  Brissette  Stations was a
part,  is to become one of the  leading  group  owners of small to  medium-sized
market television stations in the United States. The Company  believes that this
expansion  will create  economics of scale which will (i) improve its ability to
negotiate  more  favorable arrangements with program suppliers,  national  sales
representation  firms,  equipment vendors and  television networks,  (ii) enable
it to develop program consortiums for regional news and sports  programming  and
(iii) enhance its ability to attract and retain  strong  management  and  on-air
talent.

     The  Stations  are located in markets  ranked in size from 84 to 197 out of
the  211  markets  surveyed  by  A. C. Nielsen  Company ("Nielsen"). The Company
believes that broadcast  television  stations  in  small to medium-sized markets
offer  an opportunity  to generate  attractive and stable Adjusted EBITDA due to
limited competition for viewers from other over-the-air broadcasters, from other
media soliciting advertising expenditures and from other broadcasters purchasing
syndicated programming.  The Company targets small and medium-sized markets that
have stable  employment  and  population  and a diverse base of  employers.  The
markets  targeted by the Company  generally have  population  centers that share
common community  interests and are receptive to local programming.  Each of the
Stations is  affiliated  with one of the  national  television  networks,  which
provides an established  audience and  reputation for national news,  sports and
entertainment  programming.  With the established  audiences provided by network
affiliations,  management seeks to implement its strategy to enhance non-network
ratings and revenues while controlling costs.

STRATEGY

     The Company's senior  management team, led by A. Richard Benedek,  Chairman
and Chief Executive Officer,  and K. James Yager,  President and Chief Operating
Officer,  has extensive  experience in acquiring and improving the operations of
television  stations.  The Company's primary  operating  strategy is to maximize
each  Station's   advertising  revenue  through  local  news,   information  and
community-oriented  programming  that has broad audience  appeal and value-added
sales  potential,  while  maintaining  strict  cost  controls.  Key  elements of
management's strategy include:

     LOCAL NEWS LEADERSHIP AND LOCAL PROGRAMMING. Management believes that local
news and informational programming leadership contributes to higher ratings and,
therefore, increased advertising

                                       -2-



<PAGE>



     revenues.  Management's emphasis on local and ongoing community involvement
     allows the  Stations  to  maximize  the  advertising  rates they can charge
     local,  regional and national accounts,  not only for news, but for network
     and nationally-syndicated  programming which the Stations broadcast in time
     periods  adjacent to regularly  scheduled  local  newscasts  and local news
     specials.

         The Company has focused on  maintaining  and  building  each  Station's
     local  news  franchise  as the key  element  in its  strategy  to build and
     maintain    audience    loyalty.    Management    believes   that   strong,
     well-differentiated local news programming attracts high viewership levels,
     particularly  of  demographic  groups that are  appealing to both local and
     national advertisers,  thereby allowing the Company to maximize advertising
     rates.

         The Company  believes that  television  stations with a prominent local
     identity and active community  involvement can realize additional  revenues
     from  local  advertisers  through  the  development  and  sale  of  special
     promotional   programming.   The  Stations  have   developed   high-quality
     programming which highlights community events and topics of local interest.
     Locally produced  programming  includes "Our Town" segments featuring local
     news  reports,  special  promotional  announcements  and local  advertising
     focused on communities within a particular  market;  "Town Meetings," which
     provide a forum for  members of local  communities  to  discuss  and debate
     issues of local concern;  "Live Line"  programs on health,  money and legal
     matters  in which  viewers  call in to a panel of local  experts;  and home
     shopping  programs sold exclusively to local  merchants.  The Stations also
     sell promotional  advertising packages tied to various local events such as
     youth  expos,  county  fairs,  parades,  athletic  events  and other  local
     activities.  These local  programs  have proven  successful  in  attracting
     incremental  advertising  revenues and are a core element of each Station's
     local identity.

         SYNDICATED PROGRAMMING. The Company selectively purchases first run and
     off-network  syndicated  programming designed to reach specific demographic
     groups  attractive to advertisers.  Currently,  the four most  highly-rated
     syndicated  programs  in the United  States are "The Oprah  Winfrey  Show,"
     "Home  Improvement,"   "Wheel  of  Fortune"  and  "Jeopardy."  The  Company
     broadcasts  "The  Oprah  Winfrey  Show"  on seven  of the  Stations,  "Home
     Improvement" on seven of the Stations,  "Wheel of Fortune" on twelve of the
     Stations and "Jeopardy" on eight of the Stations. Additionally, the Company
     recently began broadcasting the newly syndicated "The Rosie O'Donnell Show"
     on four of the Stations and "Seinfeld" on five of the Stations. The Company
     broadcasts other highly-rated  first run syndicated  programs on several of
     the Stations  including  "Live with Regis & Kathie Lee," "Montel  Williams"
     and  "Maury  Povich."  A  number  of  the  Stations  also  broadcast  other
     highly-rated   off-network   syndicated   programming  including  "Cheers,"
     "M*A*S*H" and "Roseanne."

         The  Company  seeks  to  acquire  programs  that  are  available  on  a
     cost-effective  basis  for  limited  licensing  periods,  allow  scheduling
     flexibility,  complement each Station's overall programming mix and counter
     competitive  programming.  The Company has been able to purchase syndicated
     programming  at  attractive  rates  in  part  as a  result  of the  limited
     competition for such programming in the Company's  markets.  As a result of
     the  limited  competition  from other  broadcasters  purchasing  syndicated
     programming  in the small and  medium-sized  markets served by the Company,
     program  expense as a percentage  of net revenues for the Stations was 4.2%
     and 3.4% in 1995 and 1996, respectively.

         LOCAL SALES EMPHASIS. Management's sales strategy focuses on increasing
     the sale of local  advertising by attracting new  advertisers to television
     and increasing  the amount of  advertising  dollars being spent by existing
     local  advertisers.  Management of the Company believes that its leadership
     in local news and informational programming enhances its ability to develop
     and attract local advertising

                                       -3-



<PAGE>



     expenditures.  Management  believes that through local sales efforts it can
     stimulate local advertising  expenditures more readily than it can national
     advertising  expenditures.  This  enables the Company to react  promptly to
     changes in the national and local advertising climate.

         Trained and experienced  sales personnel sell local advertising for the
     Company in each of its markets. The Company focuses on local advertisers by
     producing their commercials,  producing news and informational  programming
     with local advertising  appeal and sponsoring or co-promoting  local events
     and activities that give local  advertisers  unique  value-added  community
     identity.  Approximately  59%  of  the  Company's  revenues  in  1996  were
     generated from local and regional advertisers.  Local and regional revenues
     for the Benedek  Stations  increased  53.5% from 1991 to 1995 compared to a
     42.7%  increase in the  national  spot  television  revenues of the Benedek
     Stations during the same period.

         FINANCIAL PLANNING AND CONTROLS.  The Company emphasizes strict control
     of  programming  and operating  costs as an important  factor in increasing
     broadcast  cash  flow.  The  Company  continually  seeks  to  identify  and
     implement cost savings  opportunities.  Management of the Company  believes
     that controlling  costs is an essential factor in achieving and maintaining
     profitability. The Company intends to continue to identify opportunities to
     increase  Adjusted  EBITDA  through  its  ongoing  strategic  planning  and
     budgeting process.

         FUTURE  ACQUISITIONS  AND  OPPORTUNITIES.  The  Company has a long-term
     strategy  to  pursue  additional   acquisitions  of  broadcast   television
     stations, primarily of network-affiliated stations in small to medium-sized
     markets  where the  Company  believes  it can  successfully  implement  its
     operating  strategy and where such stations can be acquired on  financially
     acceptable  terms.  Additionally,  a rule making  proceeding  is  currently
     pending  before  the  FCC  regarding  possible   relaxation  of  the  local
     television  duopoly  rules.  If these  rules are  implemented,  the Company
     intends to explore  opportunities to enter into local marketing  agreements
     with other  stations in markets  where it  currently  operates.  Except for
     arrangements  to acquire low power  television  licenses  in  Columbia  and
     Jefferson  City,  Missouri  which the  Company  expects to  complete in the
     second quarter of fiscal 1997, the Company does not have any understandings
     or  agreements  with  respect  to  any   acquisitions  or  local  marketing
     agreements.

INDUSTRY BACKGROUND

     Commercial television  broadcasting began in the United States on a regular
basis in the 1940's. Currently, there are a limited number of channels available
for  broadcasting  in any one  geographic  area,  and the  license  to operate a
broadcast   station  is  granted  by  the  FCC.   Television   stations  can  be
distinguished  by the  frequency on which they  broadcast.  Television  stations
which broadcast over the very high frequency ("VHF") band (channels 2-13) of the
spectrum  generally have some  competitive  advantage over  television  stations
which broadcast over the ultra-high  frequency  ("UHF") band (channels 14-69) of
the spectrum  because VHF channels  typically cover larger  geographic areas and
operate at a lower transmission cost. However,  specific market  characteristics
such as population densities, geographic features or other factors may determine
whether UHF stations are in fact at a competitive disadvantage.

     Television station revenues are primarily derived from local,  regional and
national  advertising  and, to a modest extent,  from network  compensation  and
revenues from tower rentals and commercial  production  activities.  Advertising
rates are based upon numerous factors including a program's popularity among the
viewers an advertiser wishes to attract, the number of advertisers competing for
the available time allotted to commercials,  the size and demographic make-up of
the audience and the availability of alternative

                                       -4-



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advertising  media in the market area. The extent of  advertising  expenditures,
which are sensitive to broad  economic  trends,  has  historically  affected the
broadcast industry.

     Whether or not a station is affiliated  with one of the four major networks
(ABC,  CBS, NBC or Fox) may have a significant  impact on the composition of the
station's  programming,  revenues,  expenses and  operations.  A typical network
affiliate  receives  a  significant  portion of its daily  programming  from the
network.  This  programming,  together  with cash  payments,  is provided to the
affiliate  by  the  network  in  exchange  for a  substantial  majority  of  the
advertising  time sold  during the  broadcast  of network  programming.  The Fox
network has  operating  characteristics  which are similar to ABC,  CBS and NBC,
although the hours of network  programming  produced for Fox  affiliates is less
than that produced by the other major networks. In addition,  UPN and the Warner
Bros. Network recently have been launched as new television  networks.  However,
neither produce a significant amount of network programming.

     Through the  1970's,  network  television  broadcasting  generally  enjoyed
dominance in viewership  and  television  advertising  revenues.  FCC regulation
evolved to address this dominance,  with the focus on increasing competition and
diversity of programming in the television broadcasting industry. See "--Federal
Regulation of Television Broadcasting."

     Cable and television systems were first installed in significant numbers in
the late 1960's and early 1970's and were initially used to retransmit broadcast
television programming in areas with poor broadcast signal reception.  According
to the 1996  Television & Cable  Factbook,  cable  television  currently  passes
approximately 90% of all television  households nationwide and approximately 62%
of such  households  are cable  subscribers.  Cable-originated  programming  has
emerged  as  a  significant  competitor  for  viewers  of  broadcast  television
programming.  With increased cable  penetration,  the cable programming share of
advertising revenues has increased.  Notwithstanding  increased cable viewership
and advertising,  broadcast television remains the dominant  distribution system
for mass market  television  advertising.  No single cable  programming  network
regularly attains audience levels amounting to more than a small fraction of any
single  major  broadcast   network.   Despite  the  growth  in  the  alternative
programming from cable,  according to Nielsen,  60% of all prime time television
viewing time during the 1995-1996  broadcast  season was spent viewing ABC, CBS,
NBC and Fox programming.

     Other developments have also affected television  programming and delivery.
Independent   stations  have  emerged  as  viable   competitors  for  television
viewership  share,  particularly as the result of the  availability of first run
network programming from UPN and the Warner Bros.  Network.  In addition,  there
has been  substantial  growth in the number of home satellite dish receivers and
VCRs,  which has further  expanded the number of  programming  alternatives  for
television  audiences.  Furthermore,  direct broadcast services ("DBS") to homes
from  satellites  became  available  on a  nationwide  basis  during  1994.  See
"--Competition."

BACKGROUND OF THE COMPANY

     The  Company  was  incorporated  under the laws of the State of Delaware on
April 10, 1996. Benedek Broadcasting  Corporation  ("Benedek  Broadcasting") was
incorporated  under the laws of the State of Delaware on January  22,  1979.  On
June 6,  1996, as  part of the  acquisition  of the  Stauffer  Stations  and the
Brissette Stations, Benedek Broadcasting became a wholly-owned subsidiary of the
Company.  In  March  1995,  Blue  Grass  Television,  Inc.  ("Blue  Grass")  and
Youngstown  Broadcasting  Co.,  Inc.  ("Youngstown")  were merged  into  Benedek
Broadcasting (the "Merger"). Prior to the Merger, all of the outstanding common

                                       -5-



<PAGE>



stock of Benedek  Broadcasting,  Blue Grass and  Youngstown  was owned by Mr. A.
Richard Benedek, the sole stockholder of the Company.

     Benedek Broadcasting acquired WTAP-TV in October 1979; WIFR-TV, WHSV-TV and
KHQA-TV in December  1986;  WTOK-TV in June 1988;  WTVY-TV in March  1995.  Blue
Grass  acquired  WBKO-TV in April  1983;  and  KDLH-TV in July 1985.  Youngstown
acquired WYTV in June 1983.

     The  Company's  principal executive offices are located at 100 Park Avenue,
Rockford, Illinois 61101.

NETWORK AFFILIATION OF THE STATIONS

     Each of the Stations is affiliated  with either ABC, CBS or NBC pursuant to
an  affiliation  agreement  (an  "Affiliation   Agreement").   Each  Affiliation
Agreement  provides  the  affiliated  Station  with the right to  broadcast  all
programs  transmitted  by the network with which the Station is  affiliated.  In
return,  the  network  has the  right  to  sell a  substantial  majority  of the
advertising  time during  such  broadcasts.  In  exchange  for every hour that a
Station elects to broadcast network programming,  the network pays the Station a
specified  fee,  which  varies  with  the  time  of day.  Typically,  prime-time
programming generates the highest hourly rates. Rates are subject to increase or
decrease  by the  network  during  the term of an  Affiliation  Agreement,  with
provisions  for advance  notices and the right of  termination by the Station in
the event of a reduction of rates.

     Each of the Stations' network affiliation  agreements  currently runs for a
period of five to ten years. WYTV,  WBKO-TV,  WTOK-TV and WHSV-TV,  all of which
are ABC affiliates, each have a five-year affiliation agreement which expires in
1999. KMIZ-TV, an ABC affiliate,  operates under an affiliation  agreement which
expires in 2000 and is automatically  renewed for successive  terms,  subject to
either  party's right to terminate the agreement at the end of its term upon 180
days' advance notice.  WHOI-TV,  an ABC affiliate,  currently  operates under an
affiliation  agreement  which  expires  in 2005 and which does not  provide  for
renewals.   KDLH-TV,  WIFR-TV,  KHQA-TV,  WTVY-TV,  KGWN-TV,  KGWC-TV,  KCOY-TV,
WIBW-TV, WSAW-TV, WTRF-TV, KAUZ-TV and KOSA-TV, all of which are CBS affiliates,
each  have a  ten-year  affiliation  agreement  which  expires  in  2005  and is
automatically  renewed for successive five-year terms, subject to either party's
right to terminate the agreement at the end of any term upon six months' advance
notice. WMTV-TV, WWLP-TV and WILX-TV, all of which are NBC affiliates, each have
an affiliation  agreement which expires in 2006 and is automatically renewed for
successive  five-year  terms,  subject to either  party's right to terminate the
agreement at the end of any term upon six months'  advance notice.  WTAP-TV,  an
NBC affiliate,  currently operates under a five-year affiliation agreement which
expires in 2000 and is automatically  renewed for successive  terms,  subject to
either  party's  right to terminate the agreement at the end of any term upon 12
months' advance notice.

     In  December  1995,  the Company  entered  into new  long-term  affiliation
agreements with CBS effective  retroactive to July 1, 1995 on behalf of KDLH-TV,
WIFR-TV and KHQA-TV and agreed to extend the term of the  affiliation  agreement
for WTVY from 2004 to 2005. In connection with such  arrangements,  CBS paid the
Company  bonus  payments of $2.5 million in the fourth  quarter of 1995 and $2.5
million in the first  quarter of 1996.  These  payments  will be  recognized  as
revenue by the Company at the rate of $0.5  million  per year over the  ten-year
period of the  affiliation  agreements.  The Company  also agreed with CBS that,
upon  the  consummation  of  the  Acquisitions,  the  term  of  the  affiliation
agreements of the Stauffer Stations

                                       -6-



<PAGE>



that are CBS affiliates  would be extended from 2000 to 2005 and the term of the
affiliation agreements of the Brissette Stations that are CBS affiliates will be
extended from 2004 to 2005.

     In  addition  to its  affiliation  agreements,  the  Company  entered  into
agreements  with  Fox to  broadcast  football  games  of the  National  Football
Conference  ("NFC")  of the  National  Football  League  and  certain  other Fox
programming in non-network time periods for the 1995 and 1996 broadcast seasons.
In 1996, the Company aired the NFC football  games and other Fox  programming on
KHQA-TV,  WHSV-TV, WTOK-TV, WYTV, KCOY-TV and KMIZ-TV. The Company believes that
broadcasting  NFC football games increased its audience ratings during the times
the games were broadcast.

     The  Company  recently  announced  that  it had  reached  an  agreement  in
principle  with The Warner  Bros.  Television  Network to develop a local  cable
affiliate  called the "WeB" in each of the Company's 20 markets which rank above
100. The WeB is intended to be a 24 hour,  seven day a week  television  channel
which will  broadcast  Warner  Bros.  Network  prime time  programming,  WB Kids
programming  and syndicated  programming of Warner Bros. and others.  The WeB is
scheduled  to begin  service by September  1998 in most  100-plus  markets.  The
Company will be responsible  for all local sales efforts for the new channels in
its markets.  The Company does not anticipate a significant effect on operations
during 1997 nor does it anticipate that significant capital expenditures will be
required in connection with the development of its WeB affiliates.

ADVERTISING SALES

     Television station revenues are primarily derived from local,  regional and
national  advertising  and, to a modest extent,  from network  compensation  and
revenues from tower rentals and commercial  production  activities.  Advertising
rates are based upon numerous factors including a program's popularity among the
viewers an advertiser wishes to target, the number of advertisers  competing for
the available time, the size and demographic composition of a program's audience
and the availability of competing or alternative advertising media in the market
area.  Because  broadcast  television  stations  rely  on  advertising  revenue,
declines in advertising budgets, particularly in recessionary periods, adversely
affect the  broadcast  industry and as a result may  contribute to a decrease in
the revenues of broadcast television  stations.  The Company seeks to manage its
spot inventory efficiently thereby maximizing advertising rates.

     Local  Sales.  Approximately  59% of the gross  revenues of the Stations in
1996 came from local and regional advertisers. Local and regional advertising is
sold primarily by each  Station's  professional  sales staff.  Typical local and
regional advertisers include automobile  dealerships,  retailers,  local grocery
chains,  soft drink bottlers,  hospitals,  state lotteries and restaurants.  The
Company focuses on local advertisers by producing their  commercials,  producing
news and informational  programming with local advertising appeal and sponsoring
or  co-promoting  local  events  and  activities  that  give  local  advertisers
value-added  community  identity.  The Company's  management team monitors sales
plans and promotional  activities and shares such information among the Stations
on a regular basis.

     National Sales.  Approximately 32% of the gross revenues of the Stations in
1996  came from  national  advertisers.  Typical  national  advertisers  include
automobile   manufacturers,   consumer   goods   manufacturers,   communications
companies,  fast food  franchisers,  national  retailers  and direct  marketers.
National  advertising time is sold through  representative  agencies retained by
the Company. Six of the Stations are represented by Katz  Communications,  Inc.,
eight  Stations are  represented  by Petry,  five retain  Harrington,  Righter &
Parsons, LLP as their national sales  representative,  and three are represented
by Telerep. The

                                       -7-



<PAGE>



Stations'  national  sales  coordinators  actively  assist their  national sales
representatives  to induce national  advertisers to increase their national spot
expenditures designated to the Company's markets.

RATING SERVICE DATA

     All  television  stations  in  the  United  States  are  grouped  into  211
television  markets  which  are  ranked  in  size  according  to the  number  of
television households in such markets. Nielsen periodically publishes reports on
the estimated  audience for the  television  stations in the various  television
markets throughout the country. The audience estimates are expressed in terms of
the percentage of the total potential  audience in a market viewing a particular
station (the station's  "rating") and of the  percentage of households  actually
viewing television (the station's "share").  The ratings reports provide data on
the basis of total television  households and selected demographic  groupings in
15-minute or half-hour  increments for a particular  market.  Nielsen calls each
specific  geographic market a DMA. Every county in the continental United States
is assigned to a DMA of a specific  television  market on an exclusive basis. In
larger  markets,  ratings are  determined by a combination  of meters  connected
directly to selected  television  sets (the  results of which are  reported on a
daily basis) and weekly  diaries of  television  viewing  prepared by the actual
viewers.  In smaller  markets  only  weekly  diaries are  completed  during four
separate  four-week  periods  during the course of any year.  These  periods are
commonly  knows as "sweeps  periods."  All the  Company's  markets are  measured
during these sweeps periods.

                                       -8-



<PAGE>




The following table sets forth certain  information for each of the stations and
the markets  they  serve.  Television  audience  share,  station  rank and cable
penetration are based on data compiled from the November 1996 Nielsen surveys:


<TABLE>
<CAPTION>

                                                                                         Number of
                                                                                        Commercial    Station
                                         Market       Call                    Network    Stations in  Rank In   Station      Cable
                  Market Area             Rank       Letters    Channel(c) Affiliation     Market     Market    Share    Penetration
                  -----------             ----       -------    -------     -----------     ------    ------    -----    -----------
<S>                                        <C>        <C>        <C>         <C>            <C>          <C>     <C>        <C>

Madison, Wisconsin                           84        WMTV-TV     15         NBC           4            2          16%        61.5%

Youngstown, Ohio                             95           WYTV     33         ABC           3            3          17%        73.0%

Springfield and Holyoke, Massachusetts      102        WWLP-TV     22         NBC           2            1          24%        81.8%

Lansing, Michigan                           106        WILX-TV     10         NBC           4            2          15%        66.0%

Peoria and Bloomington, Illinois            110        WHOI-TV     19         ABC           4            3          14%        72.0%

Santa Barbara, Santa Maria and              115        KCOY-TV     12         CBS           3            3          12%        84.0%
 San Luis Obispo, California

Duluth, Minnesota and Superior,
  Wisconsin                                 134        KDLH-TV     3          CBS           3            3          16%        52.7%

Rockford, Illinois                          135        WIFR-TV     23         CBS           4            2          17%        71.0%

Wausau and Rhinelander, Wisconsin           136        WSAW-TV     7          CBS           3            2          24%        50.6%

Wheeling, West Virginia and                 139        WTRF-TV     7          CBS           2            2          17%        78.0%
 Steubenville, Ohio

Topeka, Kansas                              141        WIBW-TV     13         CBS           4            1          22%        73.1%

Wichita Falls, Texas and Lawton,
  Oklahoma                                  143        KAUZ-TV     6          CBS           4            2          15%        69.0%

Columbia and Jefferson City, Missouri       145        KMIZ-TV     17         ABC           3            3          13%        61.0%

Odessa and Midland, Texas                   151        KOSA-TV     7          CBS           4            4          11%        73.5%

Quincy, Illinois and Hannibal, Missouri     158        KHQA-TV     7          CBS           2            1          24%        61.0%

Dothan, Alabama                             174        WTVY-TV     4          CBS           3            1          28%        69.0%

Panama City, Florida                        159        WTVY-TV     4          CBS           4            3          11%        68.3%

Harrisonburg, Virginia                      178        WHSV-TV     3          ABC           1            1          23%        74.0%

Bowling Green, Kentucky                     182        WBKO-TV     13         ABC           2            1          32%        56.7%

Meridian, Mississippi                       183        WTOK-TV     11         ABC           3            1          30%        52.4%

Parkersburg, West Virginia                  186        WTAP-TV     15         NBC           1            1          31%        76.4%

Cheyenne, Wyoming, Scottsbluff,             194        KGWN-TV     5          CBS           4           1(e)       17%(e)   73.0%(e)
  Nebraska and Sterling, Colorado           194     KSTF-TV(a)     10         CBS          (d)          (e)         (e)          (e)
                                            194     KTVS-TV(a)     3          CBS          (d)          (e)         (e)          (e)

Casper and Riverton, Wyoming                197        KGWC-TV     14         CBS           3           3(f)       8%(f)    67.0%(f)
                                            197     KGWL-TV(b)     5          CBS          (d)          (f)         (f)          (f)
                                            197     KGWR-TV(b)     13         CBS          (d)          (f)         (f)          (f)
---------------------------
</TABLE>

(a)  Satellite station of KGWN-TV.
(b)  Satellite station of KGWC-TV.

(c)  Channels 2 through 13 are broadcast over the very high frequency (VHF) band
     of the broadcast spectrum and channels 14 through 69 are broadcast over the
     ultra-high frequency (UHF) band of the broadcast spectrum.
(d)  Satellite stations are not considered  distinct stations in this market for
     Nielsen purposes.
(e)  Station Rank,  Station Share and Cable Penetration  information for KGWN-TV
     includes data for satellite  stations  KSTF-TV,  Scottsbluff,  Nebraska and
     KTVS-TV, Sterling, Colorado, as reported by Nielsen.
(f)  Station Rank,  Station Share and Cable Penetration  information for KGWC-TV
     includes data for satellite stations KGWL-TV,  Lander, Wyoming and KGWR-TV,
     Rock Springs, Wyoming, as reported by Nielsen.

                                       -9-



<PAGE>



WMTV-TV (NBC) MADISON, WISCONSIN

     Market Description. The Madison DMA consists of 11 counties in southwestern
Wisconsin. Recent growth in the area has increased the population in the Madison
DMA,  moving it from the 93rd largest  market in 1991 to the 84th largest market
in 1996.  Madison,  the  Wisconsin  state  capital,  is located in  southcentral
Wisconsin, 150 miles north of Chicago,  Illinois and 75 miles west of Milwaukee,
Wisconsin.  The  Madison  economy  is  a  diverse  and  stable  balance  of  the
industrial,   governmental  and  service  sectors.  Additionally,   agricultural
production of corn, alfalfa,  tobacco,  oats, eggs, cattle, hogs and, of course,
dairy  products  have  greatly  contributed  to further  stability  in the local
economy.  Many of the country's leading insurance companies,  including American
Family Mutual Insurance Group,  CUNA Mutual Insurance Group and General Casualty
have facilities in Madison.  Other prominent corporations with facilities in the
area include General Motors  Corporation,  Meriter Health Services,  Oscar Mayer
Foods Corporation, Famous Footwear, Lands' End and Rayovac Corporation.  Madison
is also home to the University of Wisconsin, with approximately 40,000 students.

     Station  History and  Characteristics.  WMTV-TV was originally  licensed in
1953 to serve  Madison,  Wisconsin.  The  Madison  market is ranked  84th in the
United States, with approximately 312,000 television households and a population
of approximately  775,000.  WMTV-TV is broadcast on UHF channel 15 and is an NBC
affiliate.  There are three other commercial  television stations in the Madison
DMA,  a CBS  affiliate  which  broadcasts  on a VHF  channel  and  ABC  and  Fox
affiliates which broadcast on UHF channels.

WYTV (ABC) YOUNGSTOWN, OHIO

     Market Description.  The Youngstown DMA consists of four counties, three of
which  are in  northeastern  Ohio and one of which is in  western  Pennsylvania.
Youngstown is situated in northeastern Ohio along the  Ohio/Pennsylvania  border
within 65 miles of Cleveland, Ohio to the northwest and Pittsburgh, Pennsylvania
to the southeast.  The Youngstown economy is historically based on processing of
pig  iron  and  steel.  While  still  part  of a  major  steel  producing  area,
Youngstown's economy has diversified to include  manufacturing,  warehousing and
distribution  companies.  Some of the major  employers  in the area  include the
Buick,  Oldsmobile  and Cadillac  Division of General  Motors  Corporation,  the
Packard  Electric  Corporation  Division  of  General  Motors  Corporation,  St.
Elizabeth's  Medical  Center,  Western Reserve Care System and LTV Steel Tubular
Products  Division  of  Republic  Steel  Works.  This  area is also  the home of
Youngstown State University with approximately 16,000 students.

     Station History and  Characteristics.  WYTV was originally licensed in 1953
to serve  Youngstown,  Ohio. The Youngstown  market is ranked 95th in the United
States,  with approximately  275,000  television  households and a population of
approximately  694,000.  WYTV  is  broadcast  on  UHF  channel  33 and is an ABC
affiliate.  The Company  acquired  WYTV in 1983.  The other local  stations with
which WYTV competes are also UHF stations,  one of which is an NBC affiliate and
the other of which is a CBS affiliate.

WWLP-TV (NBC) SPRINGFIELD AND HOLYOKE, MASSACHUSETTS

     Market Description.  The Springfield-Holyoke DMA consists of three counties
in   midwestern   Massachusetts   running   north  to  south   between  the  New
Hampshire/Vermont  and Connecticut state borders.  Springfield is located in the
Pioneer  Valley,  approximately  25 miles north of Hartford,  Connecticut and 85
miles east of Boston,  Massachusetts.  The Springfield economy has a diversified
industrial  base.  The area's most  prominent  employers  include  Massachusetts
Mutual Life Insurance Company, Milton Bradley, Inc., Monsanto Company,  Friendly
Ice Cream Corporation,  Spalding Sports Worldwide,  Stanhome,  Inc. and Baystate
Medical  Center.  Many  universities  and  colleges  are located in this region,
including  the  University  of  Massachusetts,  with  a  student  population  of
approximately 23,000,  Amherst College, Smith College and Mount Holyoke College.
Springfield is also the home of Naismith Memorial Basketball Hall of Fame.

     Station  History and  Characteristics.  WWLP-TV was originally  licensed in
1953 to serve the greater  Springfield  area.  Springfield-Holyoke  is the 102nd
largest market in the United States, with approximately

                                      -10-



<PAGE>



242,000 television households and a population of approximately 613,000. WWLP-TV
is  broadcast  on  UHF  channel  22  and is an NBC  affiliate.  The  only  other
commercial  television  station in this  market is an ABC  affiliate  which also
broadcasts on a UHF channel. WWLP-TV also competes with a CBS affiliate on a VHF
channel and, to a lesser extent,  a Fox affiliate on a UHF channel both of which
are broadcast from Hartford, Connecticut.

WILX-TV (NBC) LANSING, MICHIGAN

     Market   Description.   The  Lansing  DMA  consists  of  five  counties  in
southcentral  Michigan.  Lansing is the state capital of Michigan and is located
approximately 75 miles west of Detroit,  Michigan.  The Lansing economy,  though
recently  diversified,  is  still  a  stronghold  of  the  automotive  industry.
Prominent  employers in the area include General Motors Corporation  (Oldsmobile
Worldwide Headquarters),  Meijer, Inc., Michigan Capital Healthcare and Michigan
National  Bank.  Additionally,  there are many smaller  companies,  employing in
excess of 3,000 people,  that provide auto parts to General  Motors.  Lansing is
also home to the largest university in Michigan, Michigan State University, with
more than 40,000 students and 12,000 faculty and staff.

     Station  History and  Characteristics.  WILX-TV was originally  licensed in
1957 to  Onondaga,  Michigan.  The Lansing  market is ranked 106th in the United
States,  with approximately  231,000  television  households and a population of
approximately  589,000.  WILX-TV is  broadcast  on VHF  channel 10 and is an NBC
affiliate. WILX-TV competes with three other commercial stations in this market,
a CBS  affiliate  which  also  broadcasts  on a VHF  channel  and  ABC  and  Fox
affiliates which broadcast on UHF channels.

WHOI-TV (ABC) PEORIA AND BLOOMINGTON, ILLINOIS

     Market  Description.  The  Peoria-Bloomington  DMA  consists of 10 counties
located in central Illinois. Peoria is located approximately 150 miles southwest
of Chicago,  Illinois  and 170 miles  north of St.  Louis,  Missouri.  The major
economic sectors in the area include agriculture,  manufacturing and information
technology.  Prominent employers in the greater Peoria area include Caterpillar,
Inc.,  State Farm Insurance,  Saint Francis Medical Center,  Diamond Star Motors
and  Methodist  Medical  Center.  This  area is  also  home  to  Illinois  State
University,  with approximately 18,000 students and 3,100 employees,  as well as
Bradley University and the University of Illinois School of Medicine.

     Station  History and  Characteristics.  WHOI-TV was originally  licensed in
1953 to serve Peoria, Illinois. The Peoria-Bloomington market is ranked 110th in
the United  States,  with  approximately  225,000  television  households  and a
population of approximately 562,000.  WHOI-TV is broadcast on UHF channel 19 and
is an ABC affiliate.  There are three other commercial  stations in this market,
affiliates of CBS, NBC and Fox.  All  of  these  competitor  stations  are  also
broadcast on UHF channels.

KCOY-TV (CBS) SANTA BARBARA, SANTA MARIA AND SAN LUIS OBISPO, CALIFORNIA
     Market  Description.  The Santa Barbara - Santa Maria - San Luis Obispo DMA
consists of three counties on the southcentral coast of California.  Santa Maria
is  approximately  170 miles  north of Los  Angeles  and 270 miles  south of San
Francisco.  The region has a stable  economic base which  includes  agriculture,
transportation,  oil, tourism and  manufacturing.  Prominent  corporations  with
facilities  in the area include  Raytheon  Company,  Delco  Systems  Operations,
Chevron USA,  Santa Barbara  Research (a subsidiary of the Hughes  Corporation),
Applied  Magnetics  Corp.  and  Lockheed-Martin.  The  area is also  site of the
Vandenberg United States Air Force Base with approximately 8,400 military, civil
service and civilian  employees.  Additionally,  the University of California at
Santa Barbara and California Polytechnic  University,  with an aggregate student
population of approximately 34,000, are located within this DMA.

     Station  History and  Characteristics.  KCOY-TV was originally  licensed in
1964 to serve Santa  Maria,  California.  The Santa  Barbara - Santa Maria - San
Luis Obispo  market is ranked  115th in the United  States,  with  approximately
214,000 television households and a population of approximately 564,000. KCOY-TV

                                      -11-



<PAGE>



is  broadcast  on VHF channel 12 and is a CBS  affiliate.  There are three other
commercial  stations in this market,  ABC and NBC affiliates  which broadcast on
VHF channels and an independent station which broadcasts on a UHF channel. Until
recently, KCOY-TV was negatively impacted by the cable television retransmission
in Santa  Barbara of KCBS-TV,  Los Angeles,  California.  However,  in September
1995, KCOY-TV was granted  nonduplication  protection against KCBS-TV and is now
the only CBS affiliate whose programming is available on the Santa Barbara cable
system.

KDLH-TV (CBS) DULUTH, MINNESOTA AND SUPERIOR, WISCONSIN

     Market Description.  The Duluth-Superior DMA consists of 13 counties, seven
of  which  are in  northeastern  Minnesota,  five of which  are in  northwestern
Wisconsin  and one of which  is in the  upper  peninsula  of  Michigan.  Duluth,
Minnesota  and   Superior,   Wisconsin  are  adjacent  to  each  other  and  are
approximately  150  miles  from  Minneapolis,   Minnesota.  The  Duluth-Superior
economy,  historically based on mining and shipping,  also includes the fishing,
food products, paper, education,  medical, timber and tourism industries. Duluth
is one of the major  United  States ports from which iron ore,  taconite,  coal,
lumber,  cement,  grain, paper and chemicals are shipped.  Prominent corporation
with facilities in the area include  Minnesota  Power,  US West  Communications,
Duluth,  Missabe & Iron Range Railway Co., Louis Kemp Seafood Co., Lake Superior
Paper Industries, Potlatch Corporation, Boise Cascade, Burlington Northern Sante
Fe Railway,  Georgia-Pacific Corporation,  U.S. Steel, National Steel Pellet Co.
and  NorWest  Bank-Minnesota  North.  The  region  is also  host to a number  of
colleges and universities, including the University of Minnesota-Duluth ("UMD"),
UMD  Medical  School,  College of St.  Scholastica,  Northland  College  and the
University of Wisconsin-Superior.  In addition, the area's extensive forests and
numerous lakes have fostered a local tourism  industry and attract  thousands of
tourists  annually who camp,  hike,  ski, fish and boat in hundreds of state and
federal parks.

     Station  History and  Characteristics.  KDLH-TV was originally  licensed in
1954 to serve the Duluth,  Minnesota-Superior,  Wisconsin metropolitan area. The
Duluth-Superior  market is ranked 134th in the United States, with approximately
169,000 television households and a population of approximately 407,000. KDLH-TV
is  broadcast  on VHF channel 3 and is a CBS  affiliate.  The  Company  acquired
KDLH-TV in 1985.  KDLH-TV  competes with both an ABC and NBC affiliate which are
also broadcast on VHF channels.

WIFR-TV (CBS) ROCKFORD, ILLINOIS

     Market Description.  The Rockford DMA consists of five counties in northern
Illinois.  Rockford is  approximately  80 miles west of Chicago,  Illinois.  The
Rockford  economy   historically   centered  on   manufacturing,   has  recently
diversified  with the growth of  service-based  industries such as insurance and
financial  services.  Nevertheless,  manufacturing  still represents the largest
source of private employment in Rockford,  known as the "Fastener Capital of the
World." Prominent  corporations with facilities  located in the greater Rockford
area include Chrysler  Corporation,  Sundstrand  Corporation,  Ingersoll Milling
Machine Co.,  Barber-Colman Company,  Newell Company, Elco Industries,  Inc. and
Warner-Lambert  Company. One of the largest employers in the service industry in
this area is Rockford Memorial Hospital. Other service industry employers in the
area include Pioneer Life Insurance  Company,  AMCORE Bank,  N.A.,  Aetna Life &
Casualty and Blue  Cross/Blue  Shield of Illinois.  Additionally,  United Parcel
Service  completed  construction of a major facility at the Rockford  Airport in
late 1994, which functions as its distribution center for the entire mid-western
region of the United States.

     Station  History  and  Characteristics.  WIFR-TV  was  licensed  in 1965 to
Freeport,  Illinois to serve the greater Rockford market.  Rockford is the 135th
largest  market in the United  States,  with  approximately  166,000  television
households and a population of  approximately  422,000.  WIFR-TV is broadcast on
UHF channel 23 and is a CBS  affiliate.  The Company  acquired  WIFR-TV in 1986.
There are three other licensed  commercial  television  stations in the Rockford
market, of which two are UHF stations and one is a VHF station. Although the VHF
station's signal extends to a larger geographical area than any of the UHF

                                      -12-



<PAGE>



stations,  including WIFR-TV, such area is outside the Rockford DMA and does not
impact  audience  ratings or shares within the DMA. The other three  stations in
this market are affiliated with ABC, NBC and Fox.

WSAW-TV (CBS) WAUSAU AND RHINELANDER, WISCONSIN

     Market Description.  The  Wausau-Rhinelander DMA consists of 13 counties in
central  Wisconsin  bisected by the Wisconsin River.  Wausau is approximately 90
miles west of Green Bay, Wisconsin and 180 miles east of Minneapolis, Minnesota.
The Wausau economy,  historically based on the timber industry,  has diversified
into the farming,  manufacturing  and service sectors.  The area continues to be
one  of  the  nation's  leading  producers  of  cheese  and  ginseng.  Prominent
corporations with facilities in the greater Wausau area include Wausau Insurance
Companies,  Sentry  Insurance,  Kolbe & Kolbe Millwork,  Inc.,  Weyerhauser Co.,
Harley-Davidson, Consolidated Papers, Inc., Ore-Ida Foods, Inc., Marathon Cheese
Corp. and  Georgia-Pacific Corporation.  The area is also home to the University
of Wisconsin-Stevens Point with approximately 10,000 students and the University
of Wisconsin-Marathon Center with a student population of approximately 1,300.

     Station  History and  Characteristics.  WSAW-TV was originally  licensed in
1954 to serve Wausau,  Wisconsin. The Wausau-Rhinelander  market is ranked 136th
in the United States,  with approximately  164,000  television  households and a
population of approximately  421,000.  WSAW-TV is broadcast on VHF channel 7 and
is a CBS affiliate.  WSAW-TV  competes with  affiliates of ABC and NBC which are
also broadcast on VHF channels.

WTRF-TV (CBS) WHEELING, WEST VIRGINIA AND STEUBENVILLE, OHIO
     Market Description.  The Wheeling-Steubenville DMA consists of 12 counties,
six of which are in  northwestern  West Virginia and six of which are in eastern
Ohio.  Located in the Ohio Valley,  Wheeling and Steubenville are situated along
opposite  sides of the Ohio River  approximately  25 miles  apart.  Wheeling  is
approximately 55 miles southwest of Pittsburgh,  Pennsylvania and  approximately
120 miles east of Columbus,  Ohio.  The area's  economy,  historically  based on
heavy  manufacturing,  has  diversified  into the  manufacturing,  services  and
advanced  technology  sectors.  Prominent  corporations  with facilities in this
region include Wheeling  Pittsburgh Steel Corporation,  TIMET,  Bayer, Inc., PPG
Industries and Consolidation Coal Company. Wheeling is also home to the National
Technology  Transfer  Center,  an  independent  organization  formed to  provide
private  business and industry with a central access point for the knowledge and
data gathered by the Federal Government's 100,000 research professionals.

     Station  History and  Characteristics.  WTRF-TV was originally  licensed in
1953 to serve the Wheeling,  West  Virginia  market.  The  Wheeling-Steubenville
market  is  ranked  139th  in the  United  States,  with  approximately  158,000
television  households  and a population of  approximately  391,000.  WTRF-TV is
broadcast on VHF channel 7 and is a CBS affiliate. There is one other commercial
station in this market, an NBC affiliate also broadcast on a VHF channel.

WIBW-TV (CBS) TOPEKA, KANSAS

     Market Description.  The Topeka DMA consists of 14 counties in northeastern
Kansas.  Topeka, the capital of Kansas, is located near the geographic center of
the United States,  approximately 60 miles west of Kansas City, Missouri and 120
miles  south of  Omaha,  Nebraska.  This  area's  diversified  economy  includes
concentrations in the agriculture,  manufacturing and service industries.  Major
employers  in this  market  include  Goodyear  Tire &  Rubber  Company,  Payless
ShoeSource,  Jostons Printing and Publishing,  Hallmark Cards, Inc.,  Frito-Lay,
Inc.,  Burlington  Northern Santa Fe Railway,  Blue Cross/Blue Shield of Kansas,
Stormont-Vail  Regional  Medical  Center and  Menninger  Hospital  and School of
Psychiatric Medicine.  The region is also home to several universities including
the University of Kansas, Kansas State University, Washburn University of Topeka
and Emporia State University,  with an aggregate student population in excess of
60,000.

                                      -13-



<PAGE>



     Station  History and  Characteristics.  WIBW-TV was originally  licensed in
1953 to serve  Topeka,  Kansas.  The Topeka market is ranked 141st in the United
States with  approximately  154,000  television  households  and a population of
384,000.  WIBW-TV is broadcast on VHF channel 13 and is a CBS  affiliate.  There
are three other commercial  stations in the market,  two of which are affiliates
of ABC and NBC broadcasting on UHF channels with smaller broadcast coverage than
WIBW-TV and a Fox affiliate which broadcasts on a low power frequency.

KAUZ-TV (CBS) WICHITA FALLS, TEXAS AND LAWTON, OKLAHOMA

     Market Description.  The Wichita  Falls-Lawton DMA consists of 18 counties,
12 of which  are in  northcentral  Texas  and six of which  are in  southwestern
Oklahoma.  Wichita  Falls is located in the cross  timbers  section of the North
Central Plains of Texas,  approximately  60 miles south of Lawton,  Oklahoma and
approximately  125 miles from Dallas,  Texas and Oklahoma  City,  Oklahoma.  The
Wichita Falls-Lawton  economy,  historically based on agriculture,  ranching and
petroleum, also includes the manufacturing,  transportation, tourism and service
industries.  Prominent  corporations  with  facilities  in the area  include the
Cryovac  Division of W.R.  Grace & Co., the  Mechanics  Tool Division of Stanley
Works, Levi Strauss & Company,  PPG Industries and Goodyear Tire & Rubber Co. In
addition,  in 1995 the Texas  Department of Criminal Justice ("TDCJ") opened its
James V. Allred Unit in Wichita Falls adding approximately 875 jobs to the area.
The TDCJ has announced expansion plans for this Unit which is expected to create
an additional 200 local jobs.

     Station  History and  Characteristics.  KAUZ-TV was originally  licensed in
1953 to serve the Wichita Falls area. The Wichita  Falls-Lawton market is ranked
143rd in the United States, with approximately 153,000 television households and
a population of approximately 391,000. KAUZ-TV is broadcast on VHF channel 6 and
is a CBS affiliate.  KAUZ-TV  competes with three other  commercial  stations in
this market,  ABC and NBC affiliates  which  broadcast on VHF channels and a Fox
affiliate which broadcasts on a UHF channel.

KMIZ-TV (ABC) COLUMBIA AND JEFFERSON CITY, MISSOURI

     Market Description. The Columbia-Jefferson City DMA consists of 13 counties
in central Missouri.  Columbia and Jefferson City, approximately 30 miles apart,
are situated in the center of Missouri within 130 miles of Kansas City, Missouri
to the west and St. Louis,  Missouri to the east.  The  Columbia-Jefferson  City
economy is based  primarily on education,  health,  insurance  and  agriculture.
Additionally,  Jefferson  City is the  capital of Missouri  adding  governmental
employment  to the  economic  base of the area that has been  called a recession
resistant  community  due  to  its  diversity  and  stable  economy.   Prominent
corporations  with facilities in this market include  Toastmaster,  Inc.,  State
Farm Insurance Companies,  Shelter Insurance Companies, Quaker Oats, Oscar Mayer
Foods  Corporation,  Scholastic  Books,  ABB Power T&D Company  and A.B.  Chance
Company. The area is also home to the University of Missouri, with approximately
24,000 students and 13,000 employees.  In addition, the Fort Leonard Wood United
States Army Base and the Whitman United States Air Force Base are located within
this market.

     Station  History and  Characteristics.  KMIZ-TV  was  originally   licensed
in  1971  to   serve   the   Columbia-Jefferson   City,   Missouri   area.   The
Columbia-Jefferson  City  market  is ranked  145th in the  United  States,  with
approximately  147,000  television  households and a population of approximately
356,000. KMIZ-TV is broadcast on UHF channel 17 and is an ABC affiliate. The two
other  commercial  stations  in the  market,  affiliates  of CBS  and  NBC,  are
broadcast on VHF channels.

KOSA-TV (CBS) ODESSA AND MIDLAND, TEXAS

     Market Description.  The Odessa-Midland DMA consists of 19 counties,  18 of
which are in southwestern  Texas and one of which is in southeastern New Mexico.
Odessa,  the largest city in the Permian Basin, is approximately  275 miles east
of El Paso, Texas and 350 miles west of Dallas, Texas. The Odessa-Midland

                                      -14-



<PAGE>



economy is historically based on the oil and gas industry. The area has recently
diversified into the manufacturing and industrial service sectors, although ties
to the energy sector remain very significant. Some of the major employers in the
area include Phillips  Petroleum Company,  Exxon Corporation,  the Shell Oil Co.
Odessa  Refinery,  EVI-Highland  Pump  Company,  Rexene  Corporation,   Ref-Chem
Corporation,  Texas Instruments Inc. and Medical Center Hospital. Odessa is also
home of the  University  of Texas of the Permian  Basin,  Texas Tech  University
Health Sciences Center at Odessa and Odessa College,  with an aggregate  student
enrollment of approximately 7,000.

     Station  History and  Characteristics.  KOSA-TV was originally  licensed in
1956 to serve Odessa,  Texas. The  Odessa-Midland  market is ranked 151st in the
United States, with approximately 132,000 television households and a population
of  approximately  375,000.  KOSA-TV is  broadcast on VHF channel 7 and is a CBS
affiliate.  There are three other commercial stations in the market, ABC and NBC
affiliates  which broadcast on VHF channels and a Fox affiliate which broadcasts
on a UHF channel.

KHQA-TV (CBS) QUINCY, ILLINOIS AND HANNIBAL, MISSOURI

     Market Description.  The Quincy-Hannibal DMA consists of 18 counties, eight
of which are in western Illinois, nine of which are in northeastern Missouri and
one of which is in southeastern  Iowa. Quincy,  Illinois and Hannibal,  Missouri
are situated on opposite sides of the Mississippi River  approximately 100 miles
northwest of St. Louis, Missouri.  The Quincy-Hannibal  economy is predominantly
agricultural. This market is considered one of the largest soybean, hog and corn
producing areas in the nation.  Prominent  corporations  with facilities in this
market  include  Moorman  Manufacturing  Company,   American  Cyanamid  Company,
Pillsbury,  Inc.,  Quincy  Soybean  Co.,  Harris  Corporation,  Shaeffer Pen and
Buckhorn Rubber Products.

     Station  History and  Characteristics.  KHQA-TV was originally  licensed in
1953 to serve  the  greater  Quincy,  Illinois-Hannibal,  Missouri  market.  The
Quincy-Hannibal  market is ranked 158th in the United States, with approximately
117,000 television households and a population of approximately 286,000. KHQA-TV
is  broadcast  on VHF channel 7 and is a CBS  affiliate.  The  Company  acquired
KHQA-TV in 1986.  There is one other  station in this market,  an NBC  affiliate
carried on a VHF channel.

WTVY-TV (CBS) DOTHAN, ALABAMA AND PANAMA CITY, FLORIDA

     Market Description. WTVY-TV is one of the few stations in the United States
that serves two DMAs. The Dothan DMA consists of six counties, five of which are
in southeastern Alabama and one of which is in southwestern  Georgia.  Dothan is
located  approximately  90 miles  southeast of Montgomery,  Alabama and 85 miles
north of Panama City, Florida.  The Panama City DMA consists of nine counties in
the middle of the Florida Panhandle.

     The  Dothan  economy,   historically  agricultural,   is  currently  evenly
distributed among the service, manufacturing and agricultural sectors. Dothan is
known as the  "Peanut  Capital of the  World."  Peanuts  account for half of the
area's farm income, with cattle, poultry, corn, wheat, soybeans,  cotton, fruits
and vegetables making up the other half. Prominent  corporations with facilities
in the area include the Sony Corporation,  Perdue Farms,  Inc., General Electric
Company  and AAA  Cooper  Transport  Company.  Dothan is also home to the area's
largest  regional  shopping  mall, two regional  hospitals and five  educational
institutions  offering collegiate,  technical and vocational studies. The Dothan
DMA is also the site of the Fort Rucker United States Army Aviation Station.

     Panama City is the county seat of Bay County, Florida and is located on the
Gulf of Mexico at the mouth of St.  Andrew's  Bay.  The Panama  City  economy is
heavily  based on  year-round  tourism  as a result  of its  affordability  when
compared  to other  Florida  beach  areas.  Prominent  corporations  in the area
include Champion Paper Company and Stone Container Corporation,  as well as more
than 100 other  manufacturers.  The Panama  City DMA is the site of the  Tyndall
United  States  Air Force  Base and the  Coastal  Systems  Station of the United
States Navy.

                                      -15-



<PAGE>



     Station History and Characteristics.  WTVY-TV,  originally licensed in 1955
to serve the Dothan,  Alabama  metropolitan area,  currently serves the DMA's of
Dothan,  Alabama and Panama City, Florida.  The Dothan market is ranked 174th in
the  United  States,  with  approximately  86,000  television  households  and a
population  of  approximately  219,000,  while the Panama  City marked is ranked
159th with  approximately  110,000  television  households  and a population  of
approximately  275,000.  If combined,  these two markets would rank as the 123rd
largest market in the United  States.  WTVY-TV is broadcast on VHF channel 4 and
is a CBS  affiliate.  The Company  acquired  WTVY-TV on March 31, 1995.  WTVY-TV
competes with two other stations in the Dothan market, affiliates of ABC and Fox
which  broadcast on UHF channels.  In the Panama City market,  WTVY-TV  competes
with three other commercial stations,  affiliates of ABC and NBC which broadcast
on VHF channels and a Fox affiliate which broadcasts on a UHF channel.

WHSV-TV (ABC) HARRISONBURG, VIRGINIA

     Market Description.  The Harrisonburg DMA consists of four counties, two of
which are in  northwestern  Virginia  and two of which are in northeastern  West
Virginia.   Harrisonburg  is  located  in  the  Shenandoah  Valley  between  the
Appalachian  and  Blue  Ridge  Mountains,   approximately   110  miles  west  of
Washington, D.C. and 110 miles northwest of Richmond, Virginia. The Harrisonburg
economy has been growing rapidly over the past several years.  Several prominent
companies  have  established  regional  operations in the  Harrisonburg  market,
including the Coors  Brewing  Company and R.R.  Donnelly & Sons Co., Inc.  Other
companies in this area include Rocco Turkey, Inc., WLR Foods, Inc., Tyson Foods,
Inc.,  Hershey Co.,  Owens-Brockway  Plastics & Closures  and Merck & Co.,  Inc.
Harrisonburg  is also the home of James  Madison  University,  the largest state
university in the Virginia University system with approximately 13,000 students.

     Station History and  Characteristics.  Since its inception in 1953, WHSV-TV
has been the only VHF commercial  television  station  serving the  Harrisonburg
market.  The  Harrisonburg  market is ranked  178th in the United  States,  with
approximately  80,000  television  households and a population of  approximately
199,000.  WHSV-TV is  broadcast  on VHF channel 3 and is an ABC  affiliate.  The
Company  acquired WHSV-TV in 1986. The Station is also carried on UHF translator
on channel 64 in the adjacent Charlottesville, Virginia market. The higher costs
for  advertising in surrounding  urban areas results in a competitive  advantage
for WHSV-TV in attracting advertising revenues.

WBKO-TV (ABC) BOWLING GREEN, KENTUCKY

     Market  Description.  The Bowling  Green DMA consists of seven  counties in
southcentral  Kentucky.  Bowling  Green  is  approximately  110  miles  south of
Louisville,  Kentucky and 60 miles north of Nashville,  Tennessee. Bowling Green
lies between two different  geographic  regions:  the "Pennyroyal," a rural area
where  agriculture  and  mining  are  major  factors  in the  economy,  and  the
"Bluegrass," a region featuring rich soil and rolling hills on which some of the
most  prominent  thoroughbred  horse farms in the world are  located.  Prominent
corporations  with  facilities in this area include  Fruit of the Loom,  General
Motors Corvette  Assembly  Division,  the Holley Division of Coltec  Industries,
Eaton  Corporation,  Lord Corporation,  Pan American Mills,  Inc.,  Country Oven
Bakery Division of Kroger Stores, Inc. and Hills Pet Products.  Bowling Green is
also the home of Western Kentucky University with approximately  16,000 students
and 2,500 employees.

     Station  History and  Characteristics.  WBKO-TV was originally  licensed in
1962 to serve southcentral Kentucky. The Bowling Green market is ranked 182nd in
the  United  States,  with  approximately  70,000  television  households  and a
population of approximately 170,000.  WBKO-TV is broadcast on VHF channel 13 and
is an ABC affiliate.  The Company acquired WBKO-TV in 1983. The only other local
commercial  station  broadcasting  in  this  market  is a  Fox  affiliate  which
broadcasts  on a UHF channel.  WBKO-TV  also  competes to some extent with three
stations broadcasting from Nashville, Tennessee.

                                      -16-



<PAGE>



WTOK-TV (ABC) MERIDIAN, MISSISSIPPI

     Market  Description.  The Meridian DMA consists of seven counties,  five of
which  are in  eastern  Mississippi  and two of which  are in  western  Alabama.
Meridian is  approximately  150 miles west of  Montgomery,  Alabama and 90 miles
east of Jackson,  Mississippi. The Meridian economy,  traditionally based on the
cattle and timber industries,  has recently evolved into a medical and financial
hub for  eastern  Mississippi  and  western  Alabama.  In  addition,  Meridian's
favorable  industrial  climate  has lured over 100  manufacturing  plants to the
area,  including  Peavey  Electronics  Corporation,  James  River  Corp.,  Avery
Dennison  Stationery  Products  Division and the Delco-Remy  Division of General
Motors.  There  are also  many  large  hospitals  in the  area,  including  Rush
Foundation  Hospital,  East Mississippi State Hospital,  Riley Memorial Hospital
and Jeff Anderson  Regional  Medical  Center,  which together  employ over 3,800
individuals.  Meridian  is also site of  Meridian  Naval Air  Station,  a United
States Naval training facility.

     Station  History and  Characteristics.  WTOK-TV was originally  licensed in
1953 to serve Meridian,  Mississippi. The Meridian market is ranked 183rd in the
United States, with approximately 66,000 television  households and a population
of approximately  173,000.  WTOK-TV is broadcast on VHF channel 11 and is an ABC
affiliate.  The  Company  acquired  WTOK-TV  in 1988.  The other two  commercial
stations in the market, affiliates of NBC and CBS, are broadcast on UHF channels
with  considerably  smaller broadcast  coverage than WTOK-TV.  The CBS affiliate
recommenced  broadcasting in April 1994 after ceasing  operations in April 1992.
In  August  1995,  the CBS and NBC  affiliates  entered  into a local  marketing
agreement pursuant to which the CBS affiliate would manage the NBC affiliate.

WTAP-TV (NBC) PARKERSBURG, WEST VIRGINIA

     Market Description.  The Parkersburg DMA consists of three counties, two of
which  are in  western  West  Virginia  and one of  which  is in  eastern  Ohio.
Parkersburg  is located at the  confluence  of the Little  Kanawha  and the Ohio
Rivers, approximately 140 miles from Pittsburgh,  Pennsylvania and approximately
75 miles from  Charleston,  West  Virginia.  The  Parkersburg  economy is evenly
distributed among the manufacturing and services sectors.  A number of prominent
companies maintain facilities in the Parkersburg market, including E. I. du Pont
de Nemours & Co.,  General  Electric  Plastics,  Shell  Chemical,  Ames Company,
Nashua Photo,  Inc. and Schott  Scientific  Glass, Inc. The area is also home to
the Bureau of Public Debt, the printer for all United States  Government  Bonds,
as well as several  regional  educational  institutions  including West Virginia
University at Parkersburg, Ohio Valley College and Marietta College.

     Station  History and  Characteristics.  WTAP-TV was originally  licensed in
1953  and is the only  commercial  television  station  licensed  to  serve  the
Parkersburg market. The Parkersburg market is ranked 186th in the United States,
with   approximately   61,500   television   households   and  a  population  of
approximately  153,000.  WTAP-TV is  broadcast  on UHF  channel 15 and is an NBC
affiliate.  The  Company  acquired  WTAP-TV in 1979.  Other  network  affiliated
stations,  including one NBC affiliate, located in Charleston, West Virginia and
Columbus, Ohio, are carried on cable systems in Parkersburg, but are not part of
the Parkersburg DMA.

KGWN-TV (CBS) CHEYENNE, WYOMING
KSTF-TV (CBS) SCOTTSBLUFF, NEBRASKA
KTVS-TV (CBS) STERLING, COLORADO

     Market Description. The Cheyenne-Scottsbluff-Sterling DMA consists of three
counties, two in southeastern Wyoming and one in western Nebraska. Cheyenne, the
state capital of Wyoming,  is located  approximately  100 miles north of Denver,
Colorado.   The  Cheyenne   economy  is  supported   primarily  by   government,
transportation, tourism, services and light manufacturing. Significant employers
in the area include Union Pacific  Railroad,  United Medical  Center,  Veteran's
Administration  Hospital,  Safecard and Frontier Oil Refinery.  Cheyenne is also
home to the F. E. Warren United  States Air Force Base,  which employs more than
4,000 people in military and civilian capacities.

                                      -17-



<PAGE>



     In order to properly serve the  Cheyenne-Scottsbluff-Sterling  DMA, KGWN-TV
operates two satellite television stations, KSTF-TV in Scottsbluff, Nebraska and
KTVS-TV in Sterling,  Colorado.  Scottsbluff  is located in Scotts Bluff County,
Nebraska  approximately 100 miles northeast of Cheyenne.  Sterling is located in
Logan  County,  Colorado  approximately  100 miles  southeast of  Cheyenne.  The
satellite stations serve sparsely populated rural areas which lack the resources
to support  full-service  broadcast operations unrelated to the parent Station's
more populous communities.

     Station History and Characteristics.  KGWN-TV,  originally licensed in 1954
to serve Cheyenne,  Wyoming.  Since first going on the air, KGWN-TV has been the
only home  market  station  in the City of  Cheyenne  and  Laramie  County.  The
Cheyenne-Scottsbluff-Sterling  market is ranked 194th in the United  States with
approximately  50,000  television  households and a population of  approximately
123,000. KGWN-TV is broadcast on VHF channel 5 and is a CBS affiliate.  KSTF-TV,
broadcast  on VHF  channel  10, and  KTVS-TV,  broadcast  on VHF  channel 3, are
operated as S-2 satellites  receiving a substantial portion of their programming
from KGWN-TV.  However,  as S-2 satellites,  KSTF-TV and KTVS-TV  broadcast some
self-produced  local  programming  which is not  provided  by  KGWN-TV.  KGWN-TV
competes with two other commercial  stations in the Cheyenne market, a satellite
station of an ABC affiliate in Casper,  Wyoming which broadcasts Fox programming
in  Cheyenne,  and a  satellite  station  of an NBC  affiliate,  both  of  which
satellite  stations  broadcast on UHF channels.  KSTF-TV competes with one other
commercial  station in the  Scottsbluff  market,  a satellite  station of an ABC
affiliate  which  broadcasts on a VHF channel.  KTVS-TV  competes to some extent
with several stations broadcasting from Denver, Colorado.

KGWC-TV (CBS) CASPER, WYOMING
KGWL-TV (CBS) LANDER, WYOMING
KGWR-TV (CBS) ROCK SPRINGS, WYOMING

     Market  Description.  The  Casper-Riverton  DMA consists of six counties in
central  Wyoming.  Casper  is  located  approximately  290  miles  southeast  of
Billings,  Montana and 275 miles north of Denver,  Colorado. The Casper economy,
historically centered on oil and agriculture,  has recently diversified with the
growth of its service  sector.  Major  employers in the area include the Wyoming
Medical Center,  Wotco, Inc., Conoco, True Oil & Affiliates and Rissler McMurry.
Casper is also home to Casper College and the University of Wyoming-Casper, with
an aggregate student population of approximately 4,500.

     In  order to  properly  serve  the  vast  geographic  area  covered  by the
Casper-Riverton DMA, KGWC-TV operates two satellite television stations, KGWL-TV
in Lander,  Wyoming and KGWR-TV in Rock Springs,  Wyoming.  Lander is located in
Freemont County  approximately  140 miles  southwest of Casper.  Rock Springs is
located in Sweetwater County  approximately  220 miles southwest of Casper.  The
satellite stations serve sparsely populated rural areas which lack the resources
to support  full-service  broadcast operations unrelated to the parent Station's
more populous communities.

     Station History and Characteristics.  KGWC-TV,  originally licensed in 1980
to serve  Casper,  Wyoming.  The  Casper-Riverton  market is ranked 197th in the
United States, with approximately 50,000 television  households and a population
of  approximately  125,000.  KGWC-TV is broadcast on UHF channel 14 and is a CBS
affiliate.  KGWL-TV,  broadcast on VHF channel 5, and KGWR-TV,  broadcast on VHF
channel  13, are  operated  as S-1  satellite  stations  receiving  all of their
programming from KGWC-TV. KGWC-TV competes with two other commercial stations in
this market,  an NBC affiliate which  broadcasts on a VHF channel and an ABC/Fox
affiliate which broadcasts on a UHF channel.

COMPETITION

     The principal  methods of  competition in television  broadcasting  are the
development  of  audience  interest  through   programming  and  promotions  and
competition  in rates  charged to  advertisers.  Broadcast  television  stations
compete for advertising revenues with other broadcast stations, cable television
and all other

                                      -18-



<PAGE>



advertising  media in their  market  areas and  generally  do not  compete  with
stations  in other  markets.  The  Company has  generally  acquired  stations in
markets  where  there  are only a  limited  number  of  over-the-air  television
stations competing for local viewership and for local advertising  revenues.  In
two of its markets,  the Company owns the only local television station. In four
markets,  the Company owns one of only two local television  stations.  In seven
markets,  the  Company  owns one of three  local  television stations.  In eight
markets,  the Company owns one of four local television  stations.  In addition,
WTVY-TV competes with two other  stations  in the Dothan  market  and with three
other stations in the Panama City market.

     Audience.  Stations compete for audience on the basis of program popularity
which has a direct effect on  advertising  rates.  A significant  portion of the
Company's daily programming is supplied by the networks.  In those time periods,
the  Stations  are  totally  dependent  upon the  performance  of the  networks'
programs in attracting  viewers.  Non-network time periods are programmed by the
Stations with local news and syndicated  programs  generally  purchased for cash
and barter and, to a lesser extent,  barter-only.  The Stations also air sports,
public affairs and other entertainment programming.

     The development of methods of television  transmission of video programming
other than  over-the-air  broadcasting,  and in  particular  the growth of cable
television, has significantly altered competition for audience in the television
industry.  These other  transmission  methods  can  increase  competition  for a
broadcasting  station by bringing into its market distant  broadcasting  signals
not  otherwise  available  to the  station's  audience  and also by serving as a
distribution  system  for  non-broadcast  programming  distributed  by the cable
system.  As the  technology  of  satellite  program  delivery  to cable  systems
advanced in the late 1970's,  development  of programming  for cable  television
accelerated dramatically, resulting in the emergence of multiple, national-scale
program  alternatives  and the rapid  expansion of cable  television  and higher
subscriber  growth  rates.  Historically,  cable  operators  have not  sought to
compete with broadcast stations for a share of the local news audience.

     The FCC has authorized  several entities to construct and launch satellites
to deliver DBS to homes from satellites.  Three DBS companies provide nationwide
service and MCI  Communications  has  acquired  the right to launch a fourth DBS
satellite  service in a joint venture with the parent of Fox. In early 1997, the
Fox DBS venture and Echostar, an operating DBS company, announced a merger and a
plan to carry local broadcast stations. The FCC has also adopted rules which may
significantly  increase the number of multipoint  distribution  service stations
("MDS") (i.e., video service distributed on microwave frequencies which can only
be received by special  microwave  antennae).  These MDS stations  have launched
service in several  cities,  and one telephone  company has also begun  offering
digital MDS service.  In  addition,  the FCC has  authorized a 28 GHz  microwave
cable  service  that will have the  potential  to provide up to 100  channels of
video or more. The FCC is also licensing low power television stations which are
television  stations with coverage  areas much smaller than those served by full
power conventional television stations.

     Current  technology  offers  several  different  methods  for  transmitting
television signals with greatly improved definition,  color rendition, sound and
wider  screen  picture.  Collectively,  these  improvements  are  referred to as
digital television  ("DTV"),  with the most advanced type of transmission system
being high definition  television.  Intensive  research and development  efforts
have  achieved  forms of DTV that can be  transmitted  by  existing  terrestrial
broadcasters in the United States.  A number of such proposed  systems have been
extensively  tested by an industry test center under the auspices of an Industry
Advisory  Committee  reporting to the FCC.  Following  such  testing,  the major
proponents of the competing systems agreed to combine their efforts to provide a
single DTV system,  and these efforts resulted in technical  standards that were
submitted to the FCC in 1995. In late 1996, the FCC adopted a technical standard
for DTV. The standard will involve the broadcast of DTV on a separate television
channel from that used for conventional

                                      -19-



<PAGE>



broadcasting  and  that  channel  may  also  be used by  broadcasters  for  data
transmission and  multi-channel  transmission.  The FCC currently is determining
whether and how to assign licenses to permit television  broadcasters to provide
DTV services.  The FCC has tentatively decided to issue a second channel to each
television  broadcaster to permit it to provide DTV during a transition  period.
Although  in some  cases a DTV  channel  may  provide a  station  with a smaller
geographic service area than its current channel,  most stations are expected to
obtain DTV service areas that are consistent  with their current  service areas.
At the end of the  transition  period,  each  broadcaster  would be  required to
return to the FCC one of these two channels.  This  transition  ultimately  will
permit  broadcasters to provide higher quality services to their viewers and may
permit  broadcasters  to  compete  more  effectively  with other  digital  video
systems.  However,  constructing and operating a second television  channel will
require a substantial  capital  outlay for all of the  Stations.  The Company is
unable  to  predict  the  effect  that  technological  changes  will have on the
broadcast television industry or the future results of the Company's operations.

     In  addition,  certain  leaders in  Congress  and the  Administration  have
proposed  legislation  requiring  broadcasters  to (i)  bid at  auction  for DTV
channels,  potentially against other non-broadcast applicants, (ii) return their
analog  channels on an expedited  basis by 2005 to permit the old channels to be
reauctioned  to new  licensees  and/or (iii) pay a fee for the use of the second
channel, starting either immediately or after 2005. These proposals, if enacted,
could affect the Company.  First,  auctions for DTV channels could substantially
increase the Company's  up-front  costs of converting to DTV and would raise the
possibility  that the Company could be subject to additional  competition in its
markets  if it, or  another  licensee,  is out-bid  by a  newcomer.  Second,  an
expedited transition period could require the Company to end analog transmission
before all its  viewers  (particularly  those in the smaller  markets  which the
Company serves) have purchased DTV-compatible reception equipment.

     Programming. Competition for programming involves negotiating with national
program  distributors or syndicators  which sell first run and rerun packages of
programming. The Stations compete against local broadcast stations for exclusive
access  to first  run  product  (such as "The  Oprah  Winfrey  Show,"  "Wheel of
Fortune" and "Jeopardy") and for off-network reruns (such as "Home Improvement,"
"Seinfeld" and "Roseanne") in their respective markets.  Cable systems generally
do not compete with local stations for  programming,  although  various national
cable networks have acquired  programs that would have otherwise been offered to
local  television  stations.  Competition also occurs for exclusive news stories
and features.

     Advertising.  The  Stations  compete for  advertising  revenues  with other
television  stations  in  their  respective  markets,  as  well  as  with  other
advertising media, such as newspapers,  radio,  magazines,  outdoor advertising,
transit  advertising,  yellow  page  directories,  direct  mail and local  cable
systems.  Competition for advertising  expenditures in the broadcasting industry
occurs  primarily in  individual  markets.  Generally,  television  broadcasting
stations in one market do not compete with stations in other market areas.

     Management  cannot predict the exact nature of the competition it will face
in any market since competing  stations may change owners,  affiliations  and/or
programming focus at any time. The Company cannot predict the effect the changes
in legislation or technology,  discussed herein, will have on its operations. In
certain  markets,  construction  permits  for new  stations  have been or may be
granted.

FEDERAL REGULATION OF TELEVISION BROADCASTING

     Existing Regulation. Television broadcasting is subject to the jurisdiction
of the  FCC,  pursuant  to the  Communications  Act of  1934,  as  amended  (the
"Communications  Act").  The  Communications  Act  prohibits  the  operation  of
television  broadcasting  stations  except under a license issued by the FCC and
empowers the

                                      -20-



<PAGE>



FCC to issue,  renew,  revoke and modify  broadcasting  licenses,  regulate  the
frequency and operating power of stations,  determine station location, regulate
the equipment  used by stations,  adopt rules and  regulations  to carry out the
provisions  of the  Communications  Act  and to  impose  certain  penalties  for
violations  of the  Communications  Act. The  Communications  Act  prohibits the
assignment  of a license or the transfer of control of a licensee  without prior
approval of the FCC.

     License  Grant and Renewal.  Television  broadcasting  licenses are usually
granted or renewed for the maximum  allowable  term of eight years.  The FCC may
revoke a  license  or renew a  license  for a period  shorter  than the  maximum
allowable  term if the FCC  finds  that the  licensee  has  committed  a serious
violation of FCC rules,  has committed  other  violations  which taken  together
would constitute a pattern of abuse, or has otherwise failed to serve the public
interest.  At the  time the  application  is made for  renewal  of a  television
license,  parties in  interest  may file  petitions  to deny  renewal,  and such
parties  as well as  members of the public  may  comment  upon the  service  the
station  has  provided  during  the  preceding  term  and  urge  denial  of  the
application.  Additionally,  if an incumbent  licensee fails to meet the renewal
standard,  and if it does not show other mitigating  factors warranting a lesser
sanction,  the FCC then has the  authority to deny the renewal  application  and
consider a competing application.

     In the vast  majority of cases,  broadcast  licenses are renewed by the FCC
even when the  petitions to deny are filed  against  broadcast  license  renewal
applications.  All of the  Stations  are  presently  operating  under  five-year
licenses  expiring  on  various  dates  from 1997 to 2005.  Currently,  WTOK-TV,
Meridian,  Mississippi,  and WTVY-TV, Dothan, Alabama, have pending applications
for license renewal. The Company is not aware of any facts or circumstances that
might prevent any of the Stations from having its current license renewed at the
end of its  respective  term or which  might  prevent  the  license  renewal for
WTOK-TV or WTVY-TV from being granted.

     The  Communications  Act  prohibits  the  assignment  of a  license  or the
transfer of control of a license  without prior  approval of the FCC.  Under the
Communications  Act, no license may be held by a corporation  of which more than
20% of the  capital  stock is owned of  record,  voted or  subject to control by
aliens,  and no  corporation  may hold the capital stock of another  corporation
holding broadcast  licenses if more than 25% of the capital stock of such parent
corporation  is owned of record,  voted or subject to control by aliens,  unless
specific FCC authorization is obtained.

     Multiple Ownership Restrictions.  The FCC has promulgated a number of rules
designed  to limit the  ability of  individuals  and  entities to own or have an
ownership  interest above a certain level (an "attributable  interest,"  defined
more fully below) in broadcast  stations,  as well as other mass media entities.
These rules  include  limits on the number of  television  stations  that may be
owned both on a national  and a local  basis.  On a  national  basis,  FCC rules
generally limit any individual or entity from having  attributable  interests in
television stations with an aggregate audience reach exceeding 35% of all United
States households.

     The FCC also  limits  the  common  ownership  of  broadcast  stations  with
overlapping  service  areas,  combined  local  ownership  of a  newspaper  and a
broadcast  station and combined local ownership of a cable television system and
a broadcast  television station.  FCC rules currently allow an entity to have an
attributable  interest in only one television  station in a market. In approving
the Brissette acquisition,  the FCC granted six-month waivers of that rule as it
pertains to the transmission signal overlap of (i) WIFR-TV,  the Benedek Station
serving Rockford,  Illinois, and WMTV-TV, the Brissette Station serving Madison,
Wisconsin; (ii) WYTV, the Benedek Station serving Youngstown, Ohio, and WTRF-TV,
the Brissette  Station serving Wheeling,  West Virginia and Steubenville,  Ohio;
and (iii) WTAP-TV, the Benedek Station serving Parkersburg,  West Virginia,  and
WTRF-TV. These waivers will permit the Company to hold the

                                      -21-



<PAGE>



Stations in question for a six-month  period after closing before  divesting one
of the two Stations  that do not comply with the duopoly rule in each  instance.
The FCC has a pending  proceeding that may result in the  liberalization  of the
duopoly  rule to permit  the  Company to  continue  to own all the  Stations  it
currently  owns as well as all of those it has  received FCC consent to acquire.
The Company has requested an extension of its waiver to permit it to continue to
own these Stations pending the Commission's decision on this proceeding. The FCC
proposed  revised  duopoly  rules  during the  fourth  quarter of 1996 and it is
expected  that,  after  considering  public  comments,  new  rules  will  become
effective  during 1997 or early 1998. As a result of the limited waiver provided
by the FCC, the Company has had  discussions  concerning  exchanging  or selling
Stations   which  would   eliminate  the  duopoly   overlap.   No  agreement  or
understanding currently exists with respect to any such sale or exchange.  There
can be no assurance that the FCC will act to liberalize the rule or that it will
do so in time to avoid the Company's  being required to divest certain  Stations
in order to eliminate any signal overlap.  Expansion of the Company's  broadcast
operations in particular areas and nationwide will continue to be subject to the
FCC's ownership rules and any changes the FCC may adopt.

     Under the FCC's  ownership  rules,  if a purchaser of the Company's  common
stock  acquires an  "attributable"  interest in the Company,  a violation of FCC
regulations  could result if that  purchaser  owned or acquired an  attributable
interest in other media  properties  in a manner  prohibited by the FCC's rules.
All officers and directors of a licensee,  as well as stockholders who own 5% or
more  of  the  outstanding  voting  stock  of a  licensee  (either  directly  or
indirectly),  will  generally be deemed to have an  attributable  interest.  For
certain  institutional  investors  who  exert no  control  or  influence  over a
licensee,  the bench-mark is 10% or more of such outstanding voting stock before
attribution occurs.  Under FCC regulations,  debt instruments,  non-voting stock
and certain limited partnership  interests and voting stock held by non-majority
stockholders  in cases in which there is a single  majority  stockholder are not
generally   subject  to  attribution.   The  Company   currently  has  a  single
stockholder.  In  the  event  the  Company  no  longer  had  a  single  majority
stockholder,  minority  interests would be deemed to be attributable  interests.
The FCC has  initiated an inquiry into  modifying  several of these  attribution
standards.  It is likely that this  inquiry  will be  concluded  in late 1997 or
early 1998, and there can be no assurance that these rules will be changed.

     To the best of the Company's knowledge, no officer, director or stockholder
of the Company holds an interest in another radio or television  station,  cable
television  system  or daily  newspaper  that is  inconsistent  with  the  FCC's
ownership rules and policies.

     Regulation of Broadcast Operations.  Television broadcasters are subject to
FCC  regulation  in  several  other  areas,  including  political  broadcasting,
children's  programming,  obscene and indecent  programming and equal employment
opportunities.

     Candidates for Federal elective office have a right to buy advertising time
on television stations. Stations may also choose, but are not required, to carry
advertising by state or local candidates.  When a station carries advertising by
one candidate (whether Federal,  state or local), the station must afford "equal
opportunity" for advertising by that candidate's opponent(s). During the last 45
days of a primary campaign and the last 60 days of a general election  campaign,
stations  may not charge  political  candidates  rates any higher  than the rate
being charged to the most favored commercial  advertiser during the same period.
These  requirements  can have the effect of reducing the revenues that a station
might otherwise earn during preelection periods.

     Television  stations must serve the educational  and  information  needs of
children  in  their  overall   programming,   and  must  air  some   programming
specifically designed to serve those needs. The programming

                                      -22-



<PAGE>



obligation applies to programs originally produced and broadcast for an audience
of  children  16 years of age and  younger.  Commercial  time is limited to 10.5
minutes per hour on weekends  and 12 minutes per hour on weekdays  for  programs
originally produced and broadcast primarily for an audience of children 12 years
of age and younger.

     Television  stations may not air obscene  programming  at any time, and may
not air indecent  programming  during the morning,  afternoon and early evening.
Material is obscene if it appeals to viewers'  prurient  interests  by depicting
sexual  conduct  in a patently  offensive  manner  and lacks  serious  literary,
artistic, political or scientific value. Material is indecent if it describes in
patently offensive terms, sexual or excretory activities or organs.

     Television  stations  must  have an equal  employment  opportunity  ("EEO")
policy that prohibits  discrimination  based on race,  color,  sex,  religion or
national origin, and must establish EEO programs that encourage  recruitment and
hiring of women and  minorities.  The FCC  requires  licensees  to file  regular
employment  reports with the agency,  recruit minority or female  applicants for
vacancies, maintain records documenting the recruitment of women and minorities,
work with local  organizations  to identify  female and minority job candidates,
and examine  their  sources of job  referrals to determine if those  sources are
effective  in providing a station  with female or minority  applicants.  The FCC
recently issued a notice of proposed rulemaking regarding its EEO rules, stating
that it  hoped to make its EEO  rules  less  burdensome  (especially  for  small
stations).

     In all of the  foregoing  areas,  as well as in other  matters  that affect
operations  and  competition in the television  broadcast  industry,  regulatory
policies are subject to change over time and cannot be fully predicted.

     Proposed  Legislation  and  Regulation.  The Congress and the FCC currently
have under  consideration,  and may in the future adopt, new rules,  regulations
and  policies  regarding  a wide  variety of matters  which  could,  directly or
indirectly,  affect the operation and ownership of the Stations.  In addition to
the proposed changes set forth above,  examples of such matters include policies
concerning   eliminating   certain   cross-ownership   restrictions,   political
advertising  and  programming  practices,  flexible use of  broadcast  spectrum,
spectrum use fees, the standards to govern evaluation of television  programming
directed  toward  children and violent and indecent  programming.  Other matters
that could  affect the  Company's  broadcast  properties  include  technological
innovations  and  developments  generally  affecting  competition  in  the  mass
communications   industry,   such  as  the  initiation  of  DBS,  the  continued
establishment  of wireless cable systems and low power  television  stations and
the  participation of telephone  companies in the provision of video programming
by wire.

     Implementation  of the Cable Act of 1992.  The  Cable  Television  Consumer
Protection and  Competition Act of 1992 (the "Cable Act") was enacted on October
5,  1992.  The  Cable Act  imposes  cable  rate  regulation,  establishes  cable
ownership  limitations,  regulates the relationships between cable operators and
their program suppliers,  regulates signal carriage and  retransmission  consent
and regulates numerous other aspects of the cable television business.

     The signal carriage,  or "must carry,"  provisions of the Cable Act require
cable  operators  to carry the signals of local  commercial  and  non-commercial
television stations and certain low power television  stations.  Systems with 12
or fewer usable activated  channels and more than 300 subscribers must carry the
signals of at least three local commercial  television  stations. A cable system
with  more  than 12  usable  activated  channels,  regardless  of the  number of
subscribers, must carry the signals of all local commercial television

                                      -23-



<PAGE>



stations,  up to one-third of the aggregate number of usable activated  channels
of such system.  The Cable Act also includes a retransmission  consent provision
that  requires  cable  operators  and  other   multi-channel  video  programming
distributors to obtain the consent of broadcast  stations prior to carrying them
in certain  circumstances.  The must carry and retransmission consent provisions
are  related in that a  television  station  must elect once every  three  years
either  to waive its  right to  mandatory,  but  uncompensated,  carriage  or to
negotiate a grant of retransmission  consent to permit the cable system to carry
the station's signal.

     In April 1993, a three-judge  panel of the United States  District Court of
the  District  of  Columbia  upheld  the  constitutionality  of the  legislative
must-carry provisions. In June 1994, the Supreme Court ruled that the must-carry
provisions were  "consent-neutral" and, thus, not subject to strict scrutiny and
that  Congress's  stated  interests in preserving the benefits of free,  off-air
broadcast television, promoting the widespread dissemination of information from
a  multiplicity  of sources and  promoting  fair  competition  in the market for
television  programming  all qualify as important  governmental  interests.  The
Court,  however,  remanded to the lower federal court with  instructions to hold
further  proceedings  with  respect  to  evidence  that  lack of the  must-carry
requirements  would harm free,  off-air  broadcasting.  In 1995, the lower court
again upheld the  constitutionality  of must-carry  requirements after reviewing
the required  evidence.  The Supreme  Court  recently  agreed to review the case
again in the fall of 1996, and a decision on that case is expected by mid-1997.

     Under  rules  adopted to  implement  these  must  carry and  retransmission
consent provisions, local broadcast stations were required to make their initial
elections of must carry or  retransmission  consent by June 17, 1993,  effective
October 6, 1993.  Stations  that  failed to elect  were  deemed to have  elected
carriage  under the must carry  provisions.  Other  issues  addressed in the FCC
rules  were  market  designations,  the  scope  of  retransmission  consent  and
procedural requirements for implementing the signal carriage provisions.

     In 1993, the Company  elected and negotiated  retransmission  consents with
all of the local cable systems which carry the signals of the Benedek  Stations.
The Company has entered into  agreements  for each  Benedek  Station with all of
these cable system  operators.  All of these  agreements grant such cable system
operators to  retransmit  the Benedek  Station's  signal.  These  retransmission
arrangements  do not represent a significant  source of revenue for the Company.
The terms of these  retransmission  agreements  range from one to five years. In
1993, each of Stauffer and Brissette also elected and negotiated  retransmission
consents  with all of the local  cable  systems  carrying  the  signals of their
respective Stations and each entered into agreements for its Stations similar to
the retransmission  consent agreements entered into by the Company.  The Company
recently elected  retransmission consent with those cable systems with which the
prior  agreements  expired.  The Stations are currently  negotiating  with these
operators to enter into longer term  agreements.  The Company cannot predict the
outcome of these negotiations.  In addition,  although the Company expects to be
able to renew its current retransmission agreements when such agreements expire,
there can be no assurance that such renewals will be obtained.

EMPLOYEES

     The Company  currently  employs  approximately  1,300 full-time  employees.
Approximately  250 of the  Company's  employees  located  at  WMTV-TV,  WILX-TV,
WHOI-TV,  WTRF-TV,  KDLH-TV  and WYTV are  represented  by  labor  unions  under
collective bargaining agreements. The collective bargaining agreements expire at
various  times from 1997 through 2000.  There are no unionized  employees at the
remaining  Stations.  The Company believes that its relationship with all of its
employees, including those represented by labor unions, is satisfactory.

                                      -24-



<PAGE>



ITEM 2.  PROPERTIES.

     The Company's principal executive offices are located in leased premises in
Rockford, Illinois.

     The types of  properties  required to support each of the Stations  include
offices,  studios and tower and transmitter sites. A station's studio and office
are generally  located in business  districts while tower and transmitter  sites
are generally  located so as to provide  maximum signal coverage to each market.
The  following  table  contains  certain  information   describing  the  general
character of the properties of the Company.

<TABLE>
<CAPTION>
STATION, MARKET AREA AND USE       OWNED OR LEASED        APPROXIMATE SIZE(A)         HEIGHT/POWER       EXPIRATION OF LEASE
---------------------------------  -------------------- -----------------------  ----------------------- ----------------------
<S>                                 <C>                  <C>                       <C>                   <C>
WMTV-TV; Madison, WI

Office and Studio................         Owned             16,485 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned                   (b)               1,040 ft./955 kw              --
WYTV; Youngstown, OH

Office and Studio................         Owned             18,964 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned                   (b)                642 ft./550 kw               --
WWLP; Springfield and
  Holyoke, MA

Office and Studio................         Owned             20,000 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned                   (b)                500 ft./342 kw               --
WILX-TV; Lansing, MI

Office and Studio................         Owned             13,700 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned              5,000 sq. ft.           994 ft./309 kw               --
WHOI-TV; Peoria and
  Bloomington, IL

Office and Studio................         Owned             16,900 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned                   (b)               640 ft./2,240 kw              --
KCOY-TV; Santa Barbara,
  Santa Maria and San Luis
  Obispo, CA

Office and Studio................         Owned             18,000 sq. ft.                 --                     --
Tower/Transmitter Site...........         Leased             1,200 sq. ft.           140 ft./115 kw               (c)
KDLH-TV; Duluth, MN
  and Superior, WI

Office and Studio................         Owned           25,000 sq. ft. (d)               --                     --
Tower/Transmitter Site...........         Owned              1,040 sq. ft.           811 ft./100 kw               --
WIFR-TV; Rockford, IL

Office and Studio................         Owned             13,500 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned                   (b)                674 ft./562 kw               --
WSAW-TV; Wausau and
  Rhinelander, WI

Office and Studio................         Owned             24,400 sq. ft.                 --                     --
Tower/Transmitter Site...........       Leased (e)            432 sq. ft.            650 ft./316 kw             08/01/02
WTRF-TV; Wheeling, WV
 and Steubenville, OH

Office and Studio................         Owned           43,872 sq. ft. (f)               --                     --
Tower/Transmitter Site...........         Owned              2,000 sq. ft.           741 ft./316 kw               --


                                      -25-
</TABLE>



<PAGE>


<TABLE>
<CAPTION>
STATION, MARKET AREA AND USE       OWNED OR LEASED        APPROXIMATE SIZE(A)         HEIGHT/POWER       EXPIRATION OF LEASE
---------------------------------  -------------------- -----------------------  ----------------------- ----------------------
<S>                                <C>                 <C>                        <C>                     <C>
WIBW-TV; Topeka, KS

Office and Studio................         Leased          18,774 sq. ft. (g)               --                   08/31/98
Tower/Transmitter Site...........         Leased             2,338 sq. ft.          1,249 ft./316 kw            02/14/62
KAUZ-TV; Wichita Falls,
 TX and Lawton, OK

Office and Studio................         Owned             13,078 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned                   (b)               1,028 ft./100 kw              --
KMIZ-TV; Columbia and
  Jefferson City, MO

Office and Studio................         Owned              5,993 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned               875 sq. ft.          1,030 ft./1,580 kw             --
KOSA-TV; Odessa and
  Midland, TX

Office and Studio................         Owned             14,222 sq. ft.                 --                     --
Tower/Transmitter Site...........         Leased              930 sq. ft.            726 ft./316 kw             10/31/98
KHQA-TV; Quincy, IL
  and Hannibal, MO

Office and Studio................         Leased            13,120 sq. ft.                 --                    (h)(i)
Tower/Transmitter Site...........         Owned              1,200 sq. ft.           804 ft./269 kw               --
WTVY-TV; Dothan, AL
  and Panama City, FL

Office and Studio................         Leased            20,440 sq. ft.                 --                   12/31/02
Tower/Transmitter Site...........         Owned              2,500 sq. ft.          1,880 ft./100 kw              --
WHSV-TV; Harrisonburg, VA

Office and Studio................         Owned              6,720 sq. ft.                 --                     --
Tower/Transmitter Site...........         Leased             2,016 sq. ft.           337 ft./8.32 kw          12/31/01(j)
WBKO-TV; Bowling
  Green, KY

Office and Studio................         Owned             17,598 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned              1,175 sq. ft.           603 ft./316 kw               --
WTOK-TV; Meridian, MS

Office and Studio................         Owned             13,188 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned              1,504 sq. ft.           316 ft./316 kw               --
WTAP-TV; Parkersburg, WV

Office and Studio................         Leased            17,500 sq. ft.                 --                 04/30/05(k)
Tower/Transmitter Site...........         Owned              3,600 sq. ft.           439 ft./208 kw               --
KGWN-TV; Cheyenne, WY

Office and Studio................         Owned              7,500 sq. ft.                 --                     --
Tower/Transmitter Site...........          (l)               2,646 sq. ft.           620 ft./100 kw               --
KSTF-TV (satellite)
  Scottsbluff, NE

Office and Studio................         Owned              2,400 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned              2,457 sq. ft.           674 ft./240 kw               --


                                      -26-

</TABLE>


<PAGE>


<TABLE>
<CAPTION>

STATION, MARKET AREA AND USE       OWNED OR LEASED        APPROXIMATE SIZE(A)         HEIGHT/POWER       EXPIRATION OF LEASE
---------------------------------  -------------------- -----------------------  ----------------------- ----------------------
<S>                                <C>                   <C>                     <C>                      <C>
KTVS-TV (satellite)
  Sterling, CO
Office and Studio................         Owned              3,750 sq. ft.                 --                     --
Tower/Transmitter Site...........         Owned              2,640 sq. ft.           730 ft./60.6 kw              --

KGWC-TV; Casper and
  Riverton WY
Office and Studio................         Leased             6,827 sq. ft.                 --                   08/31/97
Tower/Transmitter Site...........         Owned              1,692 sq. ft.            235 ft./60 kw               --

KGWL-TV (satellite)
  Lander, WY
Tower/Transmitter Site...........         Leased              768 sq. ft.             155 ft./30 kw             12/31/07

KGWR-TV (satellite)
  Rock Springs, WY
Tower/Transmitter Site...........         Leased              400 sq. ft.             100 ft./12 kw             05/22/99
------------------
</TABLE>

(a)  Approximate  size is for building  space only and does not include the land
     on which the facilities are located.

(b)  Tower/Transmitter  Site is located at and  included  within the size of the
     office and studio premises.

(c)  Occupied  on a  month-to-month  basis  pursuant  to  approval of the United
     States  Department  of  Agriculture  Forest  Service.   This  property  was
     previously occupied pursuant to a Special Use Permit.  Currently the United
     States  Department  of  Agriculture  Forest  Service  is  revising  certain
     provisions  of its form of Special Use Permit  which would  otherwise  have
     been reissued to Stauffer in the ordinary  course of business.  The Company
     has applied for and anticipates that it will be issued a Special Use Permit
     with  respect  to  this  property  upon  completion  of the  aforementioned
     revisions.  However,  there can be no  assurance  that  such a Special  Use
     Permit will be issued in the future.

(d)  The Company  owns a building of  approximately  55,000 sq. ft. in which the
     offices and studio of KDLH-TV are located and of which approximately 30,000
     sq. ft. are leased to third parties.

(e)  Leased  together  with  TAK  Communications from the Wisconsin  Educational
     Board.

(f)  The Company  owns a building of  approximately  46,872 sq. ft. in which the
     offices and studio of WTRF-TV are located and of which  approximately 3,000
     sq. ft. are leased to a third party.

(g)  The Company leases a building of approximately  23,837 sq. ft. in which the
     offices and studio of WIBW-TV are located and of which  approximately 5,063
     sq. ft. are subleased to Stauffer,  which owns and operates  radio stations
     WIBW AM and FM.

(h)  Occupied on a month-to-month basis.

(i)  The Company purchased land to relocate studio and office in early 1998.

(j)  Occupied  pursuant  to a Special  Use Permit  granted by the United  States
     Department of  Agriculture  Forest Service (k) The Company has an option to
     purchase  the  premises  on each of May 1, 2000 and 2005 for  $650,000  and
     $750,000, respectively.

(l)  This  property is utilized  subject to an easement  granted by the State of
     Wyoming.

                                      -27-



<PAGE>



ITEM 3.  LEGAL PROCEEDINGS.

     The  Company  currently  and from time to time is  involved  in  litigation
incidental  to  the  conduct of its business.  The  Company  (including  in  its
capacity as  successor  of  Brissette)  is not currently  a party to any lawsuit
or  proceeding  which,  in the  opinion  of  management,  is likely  to  have  a
material adverse effect on the Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     Not applicable.

                                      -28-



<PAGE>



                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     Not applicable.

ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA.

     The following selected consolidated financial data for the five years ended
December 31, 1996  represents  the  consolidated  financial  information  of the
Company and are  derived  from the audited  Consolidated  Financial  Statements,
which Consolidated  Financial  Statements for the three years ended December 31,
1996 together with the report of McGladrey & Pullen, LLP, independent  certified
public  accountants,  are included elsewhere in this Annual Report on Form 10-K.
The selected  consolidated  financial information presented below should be read
in conjunction with the Consolidated  Financial Statements included elsewhere in
this Annual  Report on Form 10-K and  "Management's  Discussion  and Analysis of
Financial Condition and Results of Operations."

<TABLE>
<CAPTION>


                                                                                     YEAR ENDED DECEMBER 31,
                                                      -----------------------------------------------------------------------------
                                                           1992             1993          1994         1995(A)          1996(B)
                                                           ----             ----          ----         -------          -------
<S>                                                        <C>          <C>           <C>            <C>              <C>
                                                                                     (DOLLARS IN THOUSANDS)
STATEMENT OF OPERATIONS DATA:

  Net revenues(c)...................................   $    36,311    $   38,352     $    44,221   $    50,329        $   96,386
  Operating expenses:
       Station operating expenses...................        21,511        22,805          24,810        29,049            58,602
       Depreciation and amortization................         4,428         3,721           3,403         5,041            20,220
                                                      ------------  -------------   -------------  -------------      ------------
  Station operating income..........................        10,372        11,826          16,008        16,239            17,564
       Corporate....................................         1,288         1,249           1,309         1,576             2,695
      Special bonus, officer-stockholder...........             -          1,400               -             -                 -
                                                      ------------  -------------   -------------  ------------      ------------
 Operating income...................................         9,084         9,177          14,699        14,663            14,869
                                                      ------------  -------------   -------------  ------------      ------------
  Financial expenses, net:
  Interest expense, net(d):

       Cash interest, net...........................       (6,605)        (8,194)          7,740)      (14,763)          (22,559)
       Other interest...............................       (7,774)        (6,161)         (4,905)         (712)           (8,130)
                                                      ------------   -------------     ------------  -------------     ------------
                                                          (14,379)       (14,355)        (12,645)      (15,475)          (30,689)
  Other, net........................................         (310)           144            (10)            -                 -
                                                      ------------   -------------     ------------  -------------     ------------
                                                          (14,689)       (14,211)       (12,655)       (15,475)          (30,689)
                                                      ------------   -------------     ------------  -------------     ------------
  Income (loss) before income tax benefit and

    extraordinary item..............................       (5,605)        (5,034)          2,044          (812)         (15,820)
  Income tax benefit (e)............................             -             -               -             -             4,664
                                                      ------------  -------------     -------------   ------------      ------------
  Income (loss) before extraordinary item...........       (5,605)        (5,034)          2,044          (812)          (11,156)
  Extraordinary item (f)............................             -              -              -         6,864                 -
                                                      ------------  -------------     -------------  -------------      ------------
  Net income (loss).................................       (5,605)        (5,034)          2,044         6,052           (11,156)
  Preferred stock dividends and accretion...........             -              -              -            -             (9,519)
                                                      ------------  -------------     -------------  -------------      ------------
  Net income (loss) applicable to common stock......  $    (5,605)   $    (5,034)     $    2,044  $      6,052       $    20,675
                                                      ------------  -------------     -------------  -------------      ------------
                                                      ------------  -------------     -------------  -------------      ------------
  Earnings (loss) per common share (k):
    Income (loss) before extraordinary item.........  $     (0.80)   $     (0.72)     $     0.29  $      (0.12)      $     (2.94)
    Extraordinary item..............................             -             -                 -        0.98                -
                                                      ------------  -------------     -------------   -------------    ------------
    Earnings (loss) per common share................  $      (0.80) $      (0.72)     $     0.29   $      0.86       $     (2.94)
                                                      ------------  -------------     -------------  -------------      ------------
                                                      ------------  -------------     -------------  -------------      ------------

  Weighted-average common shares outstanding........     7,030,000      7,030,000      7,030,000     7,030,000         7,030,000
                                                      ------------  -------------     -------------  -------------      ------------
                                                      ------------  -------------     -------------  -------------      ------------

STATEMENT OF CASH FLOW DATA:
  Net cash provided by (used in) operating

    activities......................................     $   5,255     $    4,926         $  10,493    $    3,251      $  17,843
  Net cash (used in) investing activities...........          (375)          (864)           (2,507)      (30,972)      (326,632)
  Net cash provided by (used in) financing
    activities......................................        (1,427)        (6,951)           (7,037)       32,773        307,212



                                      -29-
</TABLE>



<PAGE>

<TABLE>
<CAPTION>


                                                                                     YEAR ENDED DECEMBER 31,
                                             -------------------------------------------------------------------------------------
                                               1992             1993              1994               1995(A)            1996(B)
                                               ----             ----              ----               -------            -------
<S>                                            <C>              <C>               <C>                <C>                 <C>
                                                                                     (DOLLARS IN THOUSANDS)
CERTAIN FINANCIAL DATA:

  Broadcast cash flow (g)....................   $ 14,728          $  15,546         $  19,627         $  21,310         $  38,865
  Broadcast cash flow margin (h).............       40.6%              40.5%             44.4%             42.3%             40.3%
  Adjusted EBITDA (i)........................     13,440             14,297            18,318            19,734            36,170
  Adjusted EBITDA margin (j).................       37.0%              37.3%             41.4%             39.2%             37.5%
  Amortization of program broadcast rights...   $  1,996         $    2,179        $    2,104         $   2,162        $    4,399
  Payment for program broadcast rights.......      2,068              2,180             1,888             2,132             3,318
  Capital expenditures.......................     14,581              1,278             1,161             2,008             5,003

BALANCE SHEET DATA (END OF PERIOD):

   Total assets..............................    $ 77,049          $  72,818         $  73,621         $114,453         $495,016
   Working capital (deficit).................         (71)             3,684             1,611           13,665            3,698
   Long-term debt (i)........................     109,439            112,874           107,607          135,767          358,234
   Redeemable preferred stock................          -                  -                 -                 -          105,519
   Stockholder's (deficit)...................     (41,004)           (44,660)          (42,615)         (36,563)         (51,561)

---------------------------
</TABLE>


(a)  On March 31, 1995, the Company acquired WTVY-TV serving Dothan, Alabama and
     Panama City,  Florida.  The statement of operations and other data does not
     include   information  with  respect  to  WTVY-TV  prior  to  the  date  of
     acquisition.

(b)  On June 6,  1996,  the  Company  acquired  the  Stauffer  Stations  and the
     Brissette  Stations.  The statement of  operations  and other data does not
     include information with respect to the Acquired Stations prior to the date
     of acquisition.

(c)  Net revenues reflect deductions from gross revenues for agency and national
     sales representative commissions.

(d)  Cash  interest  expense,   net  includes  cash  interest  paid  and  normal
     adjustments to accrued  interest.  Other interest  expense includes accrued
     interest with respect to warrants to purchase the  Company's  common stock,
     accrued interest with respect to the contingent equity value of the Company
     and long-term deferred  interest,  accrued interest added to long-term debt
     balances, deferred loan amortization and accretion of discounts.

(e)  The Company has  historically  elected to be taxed as an S Corporation  for
     federal and state income tax purposes. Accordingly, the sole stockholder of
     the Company is responsible for the payment of income taxes on the Company's
     taxable income.  Net income (loss) does not include a pro forma  adjustment
     for  income  taxes  due  to  the   availability   of  net  operating   loss
     carryforwards and a valuation allowance. The Company's election to be taxed
     as  an  S  Corporation  terminated  automatically   concurrently  with  the
     consummation of the acquisitions of the Acquired  Stations.  The Company is
     now subject to federal and state income taxes.

(f)  The Company recorded an extraordinary gain from the early extinguishment of
     debt comprised of a gain of $11.1 million reduced by losses of $2.7 million
     of  prepayment  premiums  and  contingent  payments  and  $1.5  million  of
     unamortized debt discount and deferred loan costs.

(g)  Broadcast cash flow is defined as operating  income before financial income
     as derived from the consolidated statements of operations plus depreciation
     and  amortization,  amortization  of program  broadcast  rights,  corporate
     expenses  and non-cash  compensation  less  payments for program  broadcast
     rights. The Company has included broadcast cash flow data because such data
     is used by  certain  investors  to measure a  company's  ability to service
     debt.  Broadcast  cash flow does not purport to represent  cash provided by
     operating activities as reflected in the Company's  Consolidated  Financial
     Statements,  is not a measure  of  financial  performance  under  generally
     accepted accounting principles and should not be considered in isolation or
     as a substitute  for measures of  performance  prepared in accordance  with
     generally accepted accounting principles.

(h)  Broadcast cash flow margin is defined as broadcast cash flow divided by net
     revenues.

(i)  Adjusted EBITDA is defined as operating  income before  financial income as
     derived from the  consolidated  statements of operations plus  depreciation
     and  amortization,  amortization of program  broadcast  rights and non-cash
     compensation less payments for program  broadcast  rights.  The Company has
     included  Adjusted  EBITDA  data  because  such  data is  used  by  certain
     investors to measure a company's  ability to service debt.  Adjusted EBITDA
     does not purport to  represent  cash  provided by operating  activities  as
     reflected in the  Company's  Consolidated  Financial  Statements,  is not a
     measure  of  financial  performance  under  generally  accepted  accounting
     principles and should not be considered in isolation or as a substitute for
     measures of  performance  prepared in accordance  with  generally  accepted
     accounting principles.

(j)  Adjusted  EBITDA  margin  is  defined  as  Adjusted  EBITDA  divided by net
     revenues.

(k)  Earnings  (loss) per common  share is computed by  dividing  income  (loss)
     after the deduction of preferred  dividends and accretion of the redemption
     prepayment  premium  and  amortization  of  the  initial  warrants,  by the
     weighted  average  number of common shares  outstanding.  The effect of the
     stock  options,  initial  warrants  and  contingent  warrants  has not been
     reflected  in  the  computation  since  their  inclusion  as  common  stock
     equivalents  for both primary and  fully-diluted  earnings (loss) per share
     was anti-dilutive.

(l)  Long-term  debt is defined as notes  payable  and  capital  leases  payable
     (including the current portion thereof), net of discount.

                                      -30-



<PAGE>



ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
       FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

OVERVIEW

     The operating  revenues of the Company are derived  primarily from the sale
of  advertising  time and, to a lesser  extent,  from  compensation  paid by the
networks for broadcasting  network programming and barter transactions for goods
and services.  Revenue  depends on the ability of the Company to provide popular
programming  which  attracts  audiences in the  demographic  groups  targeted by
advertisers,   thereby   allowing  the  Company  to  sell  advertising  time  at
satisfactory  rates.  Revenue also depends  significantly on factors such as the
national and local economy and the level of local competition.

     In 1996, the Company reported net revenues of $96.4 million compared to net
revenues of $50.3  million in 1995 and $44.2  million in 1994.  The  increase in
1996 net revenues was due largely to the  acquisitions of the Acquired  Stations
which represented $43.9 million. The Company had a net loss of $10.6 million for
1996 compared to a net income of $6.0 million  (after an  extraordinary  gain of
$6.9 million) in 1995 and net income of $2.0 million for 1994.  Adjusted  EBITDA
for the year ended  December  31,  1996 was $36.2  million as  compared to $19.7
million  for the year ended  December  31,  1995 and $18.3  million for the year
ended December 31, 1994.

     Local/regional  advertising and national advertising constitute the largest
categories of the Company's  operating revenues and represent  approximately 79%
of  gross  revenues  in 1996 as  compared  to 86% in 1995.  Although  relatively
constant as a total percentage of gross revenues, the mix of advertising revenue
can vary  depending on the level of  political  advertising  revenue.  Excluding
political  advertising revenue, the percentage of gross revenues attributable to
local/regional advertising and national advertising of the Company in 1994, 1995
and 1996 was 88.8%, 87.4% and 86.6%, respectively.  The decrease in 1996 was the
result of an  increase  in  network  compensation  of $4.0  million  or  126.9%,
primarily as a result of the Acquisitions, and represents 7.0% of gross revenues
(excluding political advertising revenues) for 1996 as compared to 5.6% of gross
revenues (excluding political advertising revenues) in 1995.

     Approximately  59%  of the  gross  revenues  of the  Company  in  1996  was
generated  from local and regional  advertising,  which is sold primarily by the
Stations'  sales  staff,  and  the  remainder  of the  advertising  revenues  is
comprised  primarily of national  advertising,  which is sold by national  sales
representatives  retained by the Company. The Company generally pays commissions
to  advertising  agencies on local,  regional  and national  advertising  and to
national sales  representatives  on national  advertising.  Net revenues reflect
deductions from gross revenues for commissions  payable to advertising  agencies
and national sales representatives.

     In  December  1995,  the Company  entered  into new  long-term  affiliation
agreements  with CBS effective  retroactive to July 1, 1995. In connection  with
such  arrangements,  CBS paid the Company bonus  payments of $2.5 million in the
fourth  quarter  of 1995 and $2.5  million in the first  quarter of 1996.  These
payments  are being  recognized  as revenue  by the  Company at the rate of $0.5
million  per year  over the  ten-year  term of the  affiliation  agreements.  In
connection with these payments,  the Company also agreed with CBS that, upon the
consummation  of the  acquisition  of the  Acquired  Stations,  the terms of the
affiliation  agreements for the Acquired Stations which are CBS affiliates would
be extended through 2005.

     The  Company's  primary  operating  expenses  are  employee   compensation,
programming and depreciation and amortization.  Changes in compensation  expense
result   primarily  from   adjustments  to  fixed  salaries  based  on  employee
performance  and  inflation  and,  to a lesser  extent,  from  changes  in sales
commissions paid based on levels of advertising  revenues.  Programming  expense
consists  primarily of  amortization of program  rights.  The Company  purchases
first run and off-network syndicated programming on an ongoing basis and has a

                                      -31-



<PAGE>



policy of closely  matching  payments for and  amortization of program rights in
each period. A network- affiliated station receives approximately  two-thirds of
its required daily  programming  from the network at no cost.  Depreciation  and
amortization  expense  has  generally  declined  from period to period as assets
acquired  at the time of the  acquisition  of a station  have been  depreciated.
However, for 1996,  depreciation and amortization increased $15.1 million due to
the  acquisition  of the Acquired  Stations.  Barter expense  generally  offsets
barter  revenue  and  reflects  the fair  market  value of  goods  and  services
received.   The  Company's  operating  expenses   (excluding   depreciation  and
amortization) represent approximately 63.5% of net revenues for 1996 as compared
to approximately 60.9% of net revenues for each of 1995 and 1994.

     On March 31,  1995,  the Company  acquired,  for a cash  purchase  price of
$28.7,  million  substantially  all of the assets  (including  cash and accounts
receivable) of WTVY-TV (the "Dothan Station") which is the CBS affiliate serving
both Dothan, Alabama and Panama City, Florida.

     On June 6, 1996, the Company  acquired  substantially  all of the broadcast
television assets (including  working capital of approximately  $1.6 million) of
the Stauffer Stations consisting of five principal broadcast television stations
and four satellite  broadcast  television stations for a purchase price of $54.5
million.  The principal  stations  acquired by the Company were  KCOY-TV,  Santa
Maria,  California;   WIBW-TV,  Topeka,  Kansas;  KMIZ-TV,  Columbia,  Missouri;
KGWC-TV, Casper, Wyoming; and KGWN-TV,  Cheyenne,  Wyoming. KGWC-TV operates two
satellite  stations,  KGWL-TV,  Lander,  Wyoming,  and  KGWR-TV,  Rock  Springs,
Wyoming, both of which rebroadcast the programming of KGWC-TV.  KGWN-TV operates
two satellite stations, KSTF-TV,  Scottsbluff,  Nebraska, and KTVS-TV, Sterling,
Colorado,  both of which  rebroadcast  the  programming  of KGWN-TV.  All of the
Stauffer  Stations  are  affiliated  with CBS,  except  for  KMIZ-TV,  Columbia,
Missouri, which is affiliated with ABC.

     On June 6, 1996, the Company acquired all of the capital stock of Brissette
for  $270.0  million  in  cash  and  preferred  stock.  All of  the  outstanding
indebtedness  of  Brissette  was  paid in full by the  sellers  at the  closing.
Pursuant to the  Brissette  purchase  agreement,  at the closing  Brissette  was
required  to have  working  capital of at least $8.8  million  and any amount in
excess  thereof was to be paid to the sellers.  By acquiring  all of the capital
stock of Brissette,  the Company  acquired eight  network-affiliated  television
stations  including  WMTV- TV, the NBC  affiliate  serving  Madison,  Wisconsin;
WWLP-TV, the NBC affiliate serving Springfield,  Massachusetts; WILX-TV, the NBC
affiliate serving Lansing, Michigan;  WHOI-TV, the ABC affiliate serving Peoria,
Illinois; WSAW-TV, the CBS affiliate serving Wausau, Wisconsin; WTRF-TV, the CBS
affiliate serving Wheeling,  West Virginia and Steubenville,  Ohio; KAUZ-TV, the
CBS affiliate  serving  Wichita  Falls,  Texas;  and KOSA-TV,  the CBS affiliate
serving  Odessa,  Texas.  Of the $270.0  million  paid for the capital  stock of
Brissette,  $225.0  million  was paid in cash and $45.0  million was paid by the
issuance  of the junior  preferred  stock of the  Company  to  General  Electric
Capital Corporation ("GECC").

     The Company  has  included  Adjusted  EBITDA and  broadcast  cash flow data
because such data is used by certain investors to measure a company's ability to
service debt. Adjusted EBITDA is used to pay principal and interest on long-term
debt and to fund capital  expenditures.  Adjusted EBITDA and broadcast cash flow
do not purport to represent  cash provided by operating  activities as reflected
in  the  Company's  Consolidated  Financial  Statements,  is  not a  measure  of
financial  performance under generally accepted accounting principles and should
not be  considered in isolation or as a substitute  for measures of  performance
prepared in accordance with generally accepted accounting principles.

                                      -32-



<PAGE>



     The following table sets forth certain historical results of the operations
and operating data for the periods indicated.  The table includes the results of
operations of the Acquired Stations only from the closing date of June 6, 1996.
<TABLE>
<CAPTION>

                                                       Years Ended December 31,
                                         -----------------------------------------------------
                                              1994                1995               1996
                                              ----                ----               ----
                                                        (Dollars in Thousands)
<S>                                         <C>                 <C>               <C>
Operating income........................    $    14,699         $    14,662       $     14,869
  Add:
    Amortization of program

     broadcast rights...................          2,104               2,162              4,399
    Depreciation and amortization.......          3,403               5,042             20,220
    Corporate Expenses..................          1,309               1,576              2,695
  Less:
    Payment for program

      broadcast liabilities.............        (1,888)             (2,132)            (3,318)
                                         --------------      --------------     --------------
    Broadcast cash flow.................    $    19,627         $    21,310       $     38,865
                                         --------------      --------------     --------------
                                         --------------      --------------     --------------
</TABLE>

   The following  table provides both  historical and Same Station  information.
The Same Station  information gives effect to  the  acquisition  of  the  Dothan
Station  and the  Acquired  Stations  as if such  transactions  were consummated
on January 1, 1995. The Same Station information for the  years  ended  December
31, 1995 and 1996 does not  purport to  represent  what the Company's results of
operations would have been if such  transactions had been effected at  such date
and do not purport to project results of operations of the Company in any future
period.

<TABLE>
<CAPTION>
                                                      Historical                                        Same Station
                                                Year Ended December 31,                            Year Ended December 31,
                                    ----------------------------------------------      ------------------------------------------
                                                                            %                                                  %
                                        1995             1996            Change             1995             1996           Change
                                        ----             ----            ------             ----             ----           ------
                                                                         (Dollars in Thousands)
<S>                                   <C>               <C>                  <C>            <C>              <C>             <C>
Net revenues.......................   $   50,329        $  96,386            91.5%          $120,617         $126,165        4.6%
                                    ------------      -----------      -----------      ------------     ------------     ---------
Operating expenses:
  Selling, technical and
    program expenses...............       21,199           43,759            106.4            51,842           57,332        10.6
  General and administrative.......        7,850           14,843             89.1            19,683           20,239         2.8
  Depreciation and amortization....        5,041           20,220            301.1            28,138           29,955         6.4
  Corporate........................        1,576            2,695             71.0             3,200            3,700        15.6
                                    ------------      -----------      -----------      ------------     ------------     --------
                                          35,666           81,517            128.4           102,863          111,226         8.1
                                    ------------      -----------      -----------      ------------     ------------    --------
         OPERATING INCOME..........   $   14,663        $  14,869             1.4%         $  17,754        $  14,939       (15.8)%
                                    ------------      -----------      -----------      ------------     ------------    --------
                                    ------------      -----------      -----------      ------------     ------------    --------

Broadcast cash flow................   $   21,310        $  38,865            82.4%         $  49,292        $  49,741          1.0%
Broadcast cash flow margin.........        42.3%            40.3%                              40.9%            39.4%
Adjusted EBITDA....................   $   19,734        $  36,170            83.3%         $  46,092        $  46,041         (0.1)%
Adjusted EBITDA margin.............        39.2%            37.5%                              38.2%            36.5%

</TABLE>


YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995

   Net revenues for the year ended December 31, 1996 increased  $46.1 million or
91.5% to $96.4 million from $50.3  million for the year ended  December 31, 1995
primarily  as a  result  of the  acquisition  on  June 6,  1996 of the  Acquired
Stations which increased net revenue by $43.9 million.  On a Same Station basis,
net revenues for the year ended December 31, 1996 increased $5.5 million or 4.6%
from the year ended  December  31,  1995.  On a Same  Station  basis,  political
advertising  revenue  for the year ended  December  31, 1996  increased  by $8.4
million to $9.8  million.  Gross  revenues  on a Same  Station  basis  excluding
political advertising revenue decreased $1.4 million or 1.0% from the year ended
December 31, 1995.

                                      -33-



<PAGE>



   Net revenues during the year ended December 31, 1996 were adversely  affected
by an  unexpected  weakness in  advertising  revenues  for the  Company's 12 CBS
affiliated  stations and six ABC affiliated stations which experienced a decline
in audience  shares  relative to NBC  affiliates.  On a Same Station basis,  net
revenues of the  Company's  CBS  affiliated  stations  increased by 0.9% and net
revenues of the Company's ABC affiliated  stations  increased by 5.2%, while net
revenues of the Company's NBC affiliated stations increased by 10.4%.

   Operating  expenses  for the year ended  December  31, 1996  increased  $45.9
million  or  128.5% to $81.5  million  from  $35.7  million  for the year  ended
December 31, 1995.  Of the increase in  operating  expenses,  $40.4  million was
attributable  to the  acquisition of the Acquired  Stations and $2.8 million was
attributable to depreciation  and  amortization at the Benedek Stations owned by
Benedek Broadcasting for all of 1996. As a percentage of net revenues, operating
expenses  for the  Stations  increased  to 84.6%  from  70.9% in the year  ended
December  31,  1995,  primarily  as a result of an increase of $15.2  million in
depreciation  and  amortization  expense.  On a Same  Station  basis,  operating
expenses  for the year ended  December 31, 1996  increased  $8.4 million or 8.1%
from the year ended  December  31, 1995.  Such  operating  expenses  were $111.2
million for the year ended  December 31, 1996 as compared to $102.9  million for
the  year ended  December  31,  1995.  The  increase  was  primarily  caused  by
expansion of locally-produced  news  programs  and  increased  depreciation  and
amortization.  Operating  expenses as a  percentage  of net revenues on  a  Same
Station basis increased from 85.3% for the year ended December 31, 1995 to 88.2%
for the year ended December 31, 1996.

   Operating  income for the year ended December 31, 1996 increased $0.2 million
or 1.4% to $14.9  million  from $14.7  million for the year ended  December  31,
1995.

   Financial  (expenses),  net for the year ended  December  31, 1996  increased
$15.2  million or 98.3% to $30.7  million  from $15.5  million in the year ended
December  31,  1995,  due to the  Company's  higher  debt  level  following  the
completion of the financing of the purchase  price for the Acquired  Stations in
June 1996.

   Income tax benefit  for the year ended  December  31,  1996 was $4.7  million
compared  to none  for the year  ended  December  31,  1995.  Reductions  in the
deferred  tax  liabilities  related  to the  acquisitions  and the  creation  of
deferred tax assets generated the income tax benefit for the year ended December
31, 1996. For the year ended December 31, 1995, the Company recognized no income
tax benefit due to its Subchapter S Corporation status.

   Net loss for the year ended  December 31, 1996 was $11.2  million as compared
to net income of $6.1 million for the year ended  December  31,  1995.  The year
ended  December 31, 1995 included an  extraordinary  gain of $6.9 million on the
early extinguishment of debt.

   Broadcast  cash flow for the year ended  December  31, 1996  increased  $17.6
million or 82.4% to $38.9 million from $21.3 million for the year ended December
31, 1995 primarily as a result of the acquisition of the Acquired Stations. As a
percentage of net revenues,  broadcast  cash flow margin  decreased to 40.3% for
the year ended  December  31,  1996 from 42.3% for the year ended  December  31,
1995. On a Same Station  basis,  broadcast cash flow for the year ended December
31, 1996  increased $0.4 million or 1.0% to $49.7 million from $49.3 million for
the year ended  December 31, 1995. As a percentage  of net  revenues,  broadcast
cash flow margin on a Same Station  basis  decreased to 39.4% for the year ended
December 31, 1996 from 40.9% for the year ended December 31, 1995.

                                      -34-



<PAGE>



YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994

   The following table (in thousands) sets forth certain  historical  results of
operations  and operating  data for the years ended  December 31, 1994 and 1995.
The information  does not include the results of operations of the 1996 Acquired
Stations.

<TABLE>
<CAPTION>
                                                      Year Ended December 31,
                                       -----------------------------------------------------
                                                                                        %
                                           1994                1995                   Change
                                           ----                ----                   ------

<S>                                        <C>                <C>               <C>
Net revenues..........................     $  44,221          $   50,329               13.8%
                                       -----------------------------------------------------
Operating expenses:
  Selling, technical and
    program expenses..................        17,740              21,199                19.5
  General and administrative..........         7,070               7,850                11.0
  Depreciation and amortization.......         3,403               5,042                48.2
  Corporate...........................         1,309               1,576                20.4
                                       -------------       -------------       -------------
                                              29,522              35,667                 2.8
                                       -------------       -------------       -------------
           OPERATING INCOME...........     $  14,699          $   14,662                0.3%
                                       -------------       -------------       -------------
                                       -------------       -------------       -------------

Broadcast cash flow...................     $  19,627          $   21,310                8.6%
Broadcast cash flow margin............         44.4%               42.3%
Adjusted EBITDA.......................     $  18,318          $   19,734                7.7%
Adjusted EBITDA margin................         41.4%               39.2%
</TABLE>


   Net revenues for the year ended  December 31, 1995  increased $6.1 million or
13.8% to $50.3 million from $44.2 million for the year ended  December 31, 1994.
Of this increase, $5.0 million was attributable to the acquisition in March 1995
of the Dothan Station which serves Dothan, Alabama and Panama City, Florida. For
the eight Benedek  Stations  owned by the Company for all of 1994 and 1995,  net
revenues  for the year ended  December 31, 1995  increased  $1.1 million or 2.4%
from the year ended December 31, 1994.  Gross revenues for such Benedek Stations
excluding political advertising revenue increased $2.9 million or 5.6% from 1994
to 1995. For such Benedek Stations,  political  advertising revenue for the year
ended  December  31, 1995  decreased  $1.8 million or 66.7% to $0.9 million from
$2.7 million for the year ended December 31, 1994.

   Operating  expenses  for the year ended  December  31,  1995  increased  $6.1
million or 20.8% to $35.7 million from $29.5 million for the year ended December
31, 1994. Of the increase in operating  expenses,  $4.4 million was attributable
to the  acquisition  of the Dothan  Station.  As a percentage  of net  revenues,
operating  expenses increased to 70.9% from 66.8% in the year ended December 31,
1994,  primarily as a result of an increase of $1.6 million in depreciation  and
amortization  expense.  For the eight  Stations  owned by the Company for all of
1994 and 1995, operating expenses for the year ended December 31, 1995 increased
$1.7 million or 5.9% from the year ended December 31, 1994.  Operating  expenses
as a percentage  of net revenues for the years ended  December 31, 1995 and 1994
for such Stations were 69.0% and 66.8%,  respectively,  primarily as a result of
an increase in depreciation and  amortization  from 7.7% to 8.0% of net revenues
and an increase in barter  transactions,  primarily  related to programming  and
promotion, from 4.0% to 5.0% of net revenues.

   Operating income for the years ended December 31, 1995 and 1994 remained flat
at $14.7 million as a result of the above factors.

   Financial (expenses), net for the year ended December 31, 1995 increased $2.8
million or 22.3% to $15.5 million from $12.7 million in the year ended  December
31, 1994 due to the Company's higher debt level

                                      -35-



<PAGE>



following  the offering of the  Company's 11 7/8% Senior  Secured Notes due 2005
(the "Senior Secured Notes") in March 1995.

   Net income for the year ended  December  31, 1995  increased  to $6.1 million
from $2.0 million for the year ended  December 31, 1994 primarily as a result of
a gain of $6.9 million on the early  extinguishment of debt.  This gain resulted
from  the refinancing of the Company's debt from the proceeds of the offering of
the Senior Secured Notes in March 1995.

   Broadcast  cash flow for the year ended  December  31,  1995  increased  $1.7
million or 8.6% to $21.3 million from $19.6 million for the year ended  December
31, 1994 primarily as a result of the  acquisition of the Dothan  Station.  As a
percentage of net revenues,  broadcast cash flow decreased to 42.3% for the year
ended December 31, 1995 from 44.4% for the year ended December 31, 1994.

LIQUIDITY AND CAPITAL RESOURCES

   Cash Flows from Operating  Activities is the primary source liquidity for the
Company and were $17.8 million for the year ended  December 31, 1996 compared to
$3.3 million for the year ended  December 31, 1995.  For the year ended December
31, 1996,  cash flows from operating  activities  included $2.5 million from the
bonus  payment  from  CBS  and  $2.2  million  of  collections  on net  accounts
receivable  provided  by  Stauffer.   Noncash  operating   expenses,   including
depreciation and  amortization,  increased due to the acquisition.  Depreciation
and amortization caused operating income to decrease by $21.2 million without an
effect on cash  flow.  For the year ended  December  31,  1995,  cash flows from
operating  activities  primarily  resulted from the refinancing of substantially
all of the Company's  existing  long-term  debt in March 1995 and the payment of
$4.4 million of deferred and contingent  interest and $2.7 million of prepayment
premiums. In addition,  cash used by operations in 1995 included $6.9 million of
noncash gain on early extinguishment of debt.

   Cash Flows from Investing Activities were $(326.6) million for the year ended
December 31, 1996  compared to $(31.0)  million for the year ended  December 31,
1995. For the year ended December 31, 1996, cash flows from investing activities
primarily resulted from the payment of $322.1 million for the Acquired Stations.
For the year ended  December 31, 1995,  cash flows used in investing  activities
included $26.7 million paid to acquire the Dothan Station.

   Cash Flows from Financing  Activities  were $307.2 million for the year ended
December  31, 1996  compared to $32.8  million for the year ended  December  31,
1995. For the year ended December 31, 1996, cash flows from financing activities
resulted  from the  proceeds  of  financing  the  acquisitions  of the  Acquired
Stations.  For the year ended  December  31,  1995,  cash  flows from  financing
activities  primarily resulted from the issuance in March 1995 of $135.0 million
of the Company's  Senior Secured Notes to refinance  existing  indebtedness  and
finance  the  acquisition  of the  Dothan  Station,  offset by $96.0  million of
principal payments on existing indebtedness.

THE FINANCING PLAN

   The Company, together with its subsidiary Benedek Broadcasting, implemented a
financing plan in order to finance the acquisitions of the Acquired Stations and
to pay fees and expenses  related  thereto.  The financing plan consisted of (i)
the offer and sale by the Company of the Senior Subordinated Discount Notes (the
"Notes")  to  generate  gross  proceeds of $90.2  million,  (ii) the sale by the
Company of units  consisting of Exchangeable  Redeemable  Senior Preferred Stock
and  warrants  to  generate  gross  proceeds  of $60.0  million,  (iii)  Benedek
Broadcasting  borrowing  $128.0 million  pursuant to the Term Loan Facilities of
the Credit  Agreement and (iv) the Company issuing an aggregate of $45.0 million
initial liquidation preference of Seller

                                      -36-



<PAGE>



Junior  Discount  Preferred  Stock  to GECC  and  Mr.  Paul  Brissette.  Benedek
Broadcasting currently also has  available  to  it  a  $10.0  million  revolving
credit  facility  under the Credit Agreement (the "Revolving Credit  Facility").
At  December 31,  1996, there were no outstanding borrowings under the Revolving
Credit Facility.

   The Company  believes  that the  financing  plan will provide for a long-term
financing  structure that will allow  management to  concentrate  its efforts on
maximizing results of operations.  The Company  anticipates that Adjusted EBITDA
of Benedek Broadcasting will be sufficient to finance the operating requirements
of the Stations,  debt service  requirements and presently  anticipated  capital
expenditures  until such time that the debt matures or requires  payment in full
for at least the period  until the Company is required to make cash  payments in
respect of the Notes, the Exchangeable Redeemable Senior Preferred Stock and the
Seller Junior Discount  Preferred  Stock.  The Company  anticipates that capital
expenditures  of  approximately  $7.8 million  will be  purchased in 1997.  Such
capital  expenditures  will be financed either from cash provided by operations,
borrowings under the Revolving Credit Facility or purchase money financing.

   The Notes do not bear interest  until May 15, 2001,  and the Company will not
be obligated  to pay cash  interest on the Notes until  November  15,  2001.  In
addition,  for all  dividend  payment  dates with  respect  to the  Exchangeable
Redeemable Senior Preferred Stock and interest payment dates with respect to the
Notes through and including  July 1, 2001,  the Company may, at its option,  pay
dividends  by  adding  the  amount  thereof  to the then  effective  liquidation
preference of the Exchangeable Redeemable Senior Preferred Stock or pay interest
on the Notes by issuing  additional  Notes.  For all dividend payment dates with
respect to the Seller Junior Discount  Preferred Stock prior to October 1, 2001,
the Company is required to pay such  dividends  by adding the amount  thereof to
the  then  effective  liquidation  preference  of  the  Seller  Junior  Discount
Preferred  Stock. In order for the Company to meet its debt service  obligations
after May 2001 with respect to the Notes and pay required  dividends  after July
1, 2001  with respect to the  Exchangeable Redeemable Senior Preferred Stock and
from and after  October 1,  2001  with  respect  to  the  Seller Junior Discount
Preferred Stock, the Company will need to substantially  increase broadcast cash
flow at  its stations  or  refinance.  The  Company's  debt service obligations,
including  scheduled  principal  amortization,  in the 12 month period beginning
May 15, 2001 would be approximately  $58.0  million  (assuming  that  there will
not  have  been any mandatory or voluntary prepayments of any indebtedness prior
to  that  time  and  assuming  a  blended  interest  rate  on the  amounts  then
outstanding  under  the  Credit Agreement  comparable to the rate the Company is
currently  paying).  The Company's  cash  dividend  payments  during such period
on  the  Exchangeable  Redeemable  Senior  Preferred Stock and the Seller Junior
Discount Preferred Stock would be approximately $27.0 million.

   In order to repay the Notes and Benedek  Broadcasting's  Senior Secured Notes
at maturity,  the Company will need to refinance all or a portion of such notes.
The Company's  ability to refinance the Notes and the Senior  Secured Notes will
depend upon the Company's operating performance,  as well as prevailing economic
and market  conditions,  levels of interest rates,  refinancing  costs and other
factors, many of which are beyond the Company's control.

   The Company is a holding company that will derive all of its operating income
and Adjusted EBITDA from its sole subsidiary,  Benedek Broadcasting,  the common
stock of which, together with all other assets of the Company, have been pledged
to  secure  the  Company's  senior  guarantee  of all  indebtedness  of  Benedek
Broadcasting outstanding under the Credit Agreement and in respect of the Senior
Secured  Notes.  As  a  holding  company,  the  Company's  ability  to  pay  its
obligations,  including  its  obligation to pay interest on and principal of the
Notes,  whether at  maturity,  upon a change of control  or  otherwise,  will be
dependent primarily upon receiving dividends and other payments or advances from
Benedek  Broadcasting.  Benedek  Broadcasting  is a separate and distinct  legal
entity and has no obligation, contingent or otherwise, to pay any amounts to the
Company or to make funds  available to the Company for debt service or any other
obligation.  Although the Credit Agreement does not limit the ability of Benedek
Broadcasting to pay dividends or make other payments to the Company,  the Senior
Secured Note  Indenture  does contain such  limitations.  However,  after giving
effect to the  implementation  of the financing plan on June 6, 1996  (including
the contribution to the common equity

                                      -37-



<PAGE>



of Benedek  Broadcasting  of net cash proceeds of  approximately  $188.8 million
from the sale of the Notes, the Exchangeable  Redeemable  Senior Preferred Stock
and the Seller  Junior  Discount  Preferred  Stock),  as of December  31,  1996,
Benedek Broadcasting could have distributed  approximately $188.8 million to the
Company under such limitations.

   The Credit  Agreement  entered  into by Benedek  Broadcasting  as part of the
financing plan includes Term Loan Facilities and a Revolving Credit Facility. At
June 6, 1996,  the Term Loan  Facilities  consisted  of (i) Series A Facility of
$70.0  million  and (ii)  Series B  Facility  of $58.0  million.  The Term  Loan
Facilities  generally provide for quarterly  amortization  until final maturity.
The Series A Facility  will  mature in June 2001 and the Series B Facility  will
mature in December  2002.  Benedek  Broadcasting  is required to make  scheduled
amortization  payments on the Term Loan  Facilities,  on an aggregate  basis for
Series A and Series B Facilities,  as follows: during 1997, $8.5 million; during
1998, $12.75 million;  during 1999, $15.25 million; during 2000, $21.75 million;
during 2001, $21.25 million; and during 2002, $45.5 million.

   In addition, Benedek Broadcasting will be required to make prepayments on the
Term Loan Facilities under certain  circumstances,  including upon certain asset
sales and issuance of debt or equity securities.  Benedek Broadcasting will also
be required to make  prepayments on the Term Loan  Facilities in an amount equal
to 75% of excess cash flow (as defined) so long as the  Company's  ratio of debt
to Adjusted  EBITDA  remains above 6.75 and 50% of such excess cash flow if such
ratio is at or below  6.75.  These  mandatory  prepayments  will be  applied  to
prepay, on a pro rata basis, the Series A and Series B Facilities.  The Series A
Facility bears interest, at Benedek Broadcasting's option, at a base rate plus a
spread or at a  Eurodollar  rate  plus a spread.  The  Series B  Facility  bears
interest, at Benedek Broadcasting's option, at a base rate plus a spread or at a
Eurodollar  rate  plus a  spread.  The  margins  above  the  base  rate  and the
Eurodollar rate at which the Term Loan Facilities and Revolving  Credit Facility
will bear interest are subject to  reductions at such times as certain  leverage
ratio performance tests are met.

   The Company  entered into an interest rate cap agreement which matures in May
1998 to reduce  the impact of changes  in  interest  rates on its  floating-rate
long-term  debt. That agreement  effectively  entitles  Benedek  Broadcasting to
receive  from a financial  institution  the amount,  if any, by which the London
Interbank  Offering  Rate (LIBOR)  exceeds 7.36% on a notional  amount  totaling
$125,000,000 subject to an amortization schedule.  Although Benedek Broadcasting
is exposed to credit loss in the event of  nonperformance by the counterparty on
the  interest  rate  cap,  management  does  not  expect  nonperformance  by the
counterparty.

   Benedek  Broadcasting  has the  ability,  subject  to a  borrowing  base  and
compliance with certain covenants and conditions,  to borrow up to an additional
$10.0 million for general corporate purposes  pursuant to the  Revolving  Credit
Facility. The Revolving Credit Facility has a term expiring in 2001 and is fully
revolving until final maturity. The Revolving Credit Facility bears interest, at
Benedek  Broadcasting's  option, at a base rate plus a spread or at a Eurodollar
rate plus a spread.

   The Term Loan  Facilities  and the Revolving  Credit  Facility are secured by
certain of Benedek  Broadcasting's  present and future property and assets.  The
Term Loan Facilities are also guaranteed by Benedek License Corporation ("BLC"),
a wholly-owned  subsidiary of Benedek  Broadcasting  that holds the FCC licenses
and authorizations for the Stations, and is secured by all of the stock of BLC.

   The Term Loan Facilities and the Revolving  Credit  Facility  contain certain
financial  covenants,  including,  but not limited to, covenants related to cash
interest coverage, fixed charge coverage, bank debt/Adjusted EBITDA ratio, total
debt/Adjusted  EBITDA ratio and minimum Adjusted EBITDA.  In addition,  the Term
Loan Facilities and the Revolving Credit Facility contain other  affirmative and
negative  covenants  relating to (among other things)  liens,  payments on other
debt,   restricted  junior  payments   (excluding   distributions  from  Benedek
Broadcasting  to  the  Company)   transactions  with  affiliates,   mergers  and
acquisitions, sales of assets,

                                      -38-



<PAGE>



guarantees and  investments.  The Term Loan Facilities and the Revolving  Credit
Facility contain  customary events of default for  highly-leveraged  financings,
including certain changes in ownership or control of Benedek Broadcasting or the
Company.

   As a result of the lower than  expected  increases  in net revenues on a Same
Station basis and the increases in operating expenses on a Same Station basis at
certain  of the  Acquired  Stations  during the  second  quarter  prior to their
acquisition by the Company as described  above, at September 30 and December 31,
1996, the Company did not meet certain  financial ratios contained in the Credit
Agreement.  The  lenders  under  the  Credit  Agreement  agreed  to  waive  such
noncompliance.  In connection with each such waiver,  the  Company  agreed  that
for so long as its ratio of debt to  Adjusted  EBITDA (as  defined in the Credit
Agreement)  exceeded certain levels, the Term Loan Facilities will bear interest
at varying  additional  spreads from that originally  provided for in the Credit
Agreement.  In connection with the waiver for December 1996, the Company and its
lenders revised the financial covenants applicable to the Company for the period
through  the first half of 1998 and the Company  agreed to reduce the  Revolving
Credit  Facility  from  $15.0  million  to $10.0  million  and to  increase  the
percentage  of excess  cash flow to be applied as  prepayments  of the Term Loan
Facilities  from 50% to 75% until the Company's ratio of debt to Adjusted EBITDA
is at 6.75 or lower.

RECENT DEVELOPMENTS

   In September 1996, the Company  announced that it had reached an agreement in
principle  with The Warner  Bros.  Television  Network to develop a local  cable
affiliate  called the "WeB" in each of the Company's 20 markets which rank above
100. The WeB is intended to be a 24 hour,  seven day a week  television  channel
which will  broadcast  Warner  Bros.  Network  prime time  programming,  WB kids
programming  and syndicated  programming of Warner Bros. and others.  The WeB is
scheduled to begin service in by the fall of 1998 in most 100-plus markets.  The
Company will be responsible  for all local sales efforts for the new channels in
its markets.  The Company does not anticipate a significant effect on operations
during 1997 nor does it anticipate that significant capital expenditures will be
required in connection with the development of its WeB affiliates.

   During 1996,  Benedek  Broadcasting  made  arrangements  to acquire low power
television  licenses in Columbia and Jefferson City,  Missouri which is expected
to be completed in the second quarter 1997. Benedek Broadcasting does not expect
material expenditures for the acquisition of these licenses or immediate capital
needs.

SEASONALITY

   Net revenues and Adjusted  EBITDA of the Company are generally  higher during
the fourth  quarter of each year,  primarily  due to increased  expenditures  by
advertisers in anticipation of holiday season consumer  spending and an increase
in viewership  during this period,  and, to a lesser  extent,  during the second
quarter of each year.

INCOME TAXES

   Historically,  Benedek Broadcasting had elected to be taxed as a Subchapter S
Corporation.  Therefore, for the years ended December 31, 1994 and 1995, and for
the period January 1, 1996 through June 6, 1996, income taxes were not reflected
in the consolidated financial statements, but the income, deductions, losses and
credits  were  passed  to  Benedek  Broadcasting's sole stockholder.  Concurrent
with the  completion  of the  financing  for the  acquisitions  of the  Acquired
Stations,  Benedek  Broadcasting's  election  to  be  taxed  as a  Subchapter  S
Corporation  was  terminated  and Benedek Broadcasting became subject to federal
and state  income taxes.  In  conjunction  with the acquisition of Brissette,  a
deferred tax liability of $53.3 million was recognized primarily associated

                                      -39-



<PAGE>



with the variance  between future tax deductions  allowed for  depreciation  and
amortization of intangibles and the amount of such depreciation and amortization
that will be reflected for book purposes.

   For the year  ended  December  31,  1996, a tax benefit of $5.4  million  was
recognized  consisting of a $5.6 million benefit related to the net reduction of
deferred income tax liabilities and $0.2 million of taxes currently due.

   Under  the  provisions  of  the  Internal   Revenue  Code,  the  Company  has
approximately $9.4 million of  actual net operating loss carryforwards available
to offset future tax liabilities  of the  Company,  that begin to expire in 2007
through 2011.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

   See pages F-1 and S-2.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

   Not applicable.

                                      -40-



<PAGE>



                                    PART III

ITEM 10.      DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY.

     The  following  table sets forth certain  information  with respect to each
director and executive officer of the Company:

<TABLE>
<CAPTION>
                   NAME                        AGE                             POSITION

<S>                                               <C>  <C>
A. Richard Benedek.........................       57  Chairman, Chief Executive Officer and Director
K. James Yager.............................       61  President and Director
Ronald L. Lindwall.........................       51  Senior Vice President-Finance, Chief Financial
                                                       Officer, Treasurer, Secretary and Director
Terrance F. Hurley.........................       40  Senior Vice President of Benedek Broadcasting
Keith L. Bland.............................       41  Senior Vice President-Planning and Technology of
                                                       Benedek Broadcasting
Mary L. Flodin.............................       41  Vice President and Controller
Jay Kriegel................................       56  Director
Paul S. Goodman............................       42  Director

</TABLE>

     Mr. A.  Richard  Benedek has been  engaged in the  television  broadcasting
industry for over 15 years.  Mr.  Benedek is the  Chairman  and Chief  Executive
Officer of the Company.  Mr. Benedek has served as Chairman and Chief  Executive
Officer of Benedek  Broadcasting  since its formation in January 1979.  From the
formation of Benedek  Broadcasting  until March 1995, Mr. Benedek also served as
President of Benedek Broadcasting.  Additionally, Mr. Benedek has also served as
President and Chief  Executive  Officer of Blue Grass and Youngstown  from their
formation in January 1980, and September 1982,  respectively,  until the Merger.
Prior to his activities in the television broadcasting industry, Mr. Benedek was
a partner in the investment banking firm of Bear, Stearns & Co. Inc.

     Mr. K. James Yager has been engaged in the television broadcasting industry
for over 35 years.  Mr. Yager is the  President  of the  Company.  Mr. Yager has
served as President of Benedek Broadcasting since March 1995. From 1987 until he
became  President,  Mr.  Yager  served as  Executive  Vice  President of Benedek
Broadcasting.  Mr. Yager has also served as Vice President of each of Blue Grass
and Youngstown from 1990 to 1993, respectively,  until the Merger. Mr. Yager was
employed  by Cosmos  Broadcasting  from 1960 until  1980,  including  as general
manager of its television stations in Columbia,  South Carolina and New Orleans,
Louisiana.  From 1980 until 1986,  Mr. Yager was  Executive  Vice  President and
Chief  Operating  Officer  of  Spartan  Radiocasting,  which  then  owned  three
television stations and four radio stations.

     Mr.  Ronald  L.  Lindwall  is  the  Senior  Vice  President-Finance,  Chief
Financial Officer, Secretary and Treasurer of the Company. Mr. Lindwall has also
held the same  positions  at Benedek  Broadcasting  since March 1995.  From 1990
until March 1995, Mr. Lindwall served as Senior Vice President,  Chief Financial
Officer and Treasurer of Benedek  Broadcasting.  Mr. Lindwall has also served as
Senior Vice  President,  Chief  Financial  Officer and Treasurer of each of Blue
Grass and Youngstown from 1990 until the Merger. From 1982 to 1990, Mr. Lindwall
was a partner at the accounting firm of McGladrey & Pullen.

     Mr.  Terrance F. Hurley was recently  promoted to Senior Vice  President of
Benedek Broadcasting in anticipation of the completion of the Acquisitions. From
December 1995 until his promotion,  Mr. Hurley served as Vice  President/General
Manager of KDLH-TV serving Duluth, Minnesota and Superior, Wisconsin. Mr. Hurley
also served as General  Manager of KDLH-TV from October 1994 until December 1995
and General  Sales  Manager of KHQA-TV  serving  Quincy,  Illinois and Hannibal,
Missouri from May 1993 until

                                      -41-



<PAGE>



December  1995.  From 1991  until May  1993,  Mr.  Hurley  was  employed  by Dix
Communications  as  the  General  Sales  Manager  of  KAAL-TV,  serving  Austin,
Minnesota.

     Mr. Keith L. Bland has been engaged in the television broadcasting industry
for  over  22  years.  Mr.  Bland  has  served  as Vice  President-Planning  and
Technology of Benedek  Broadcasting  since  January 1996.  From March 1995 until
January 1996, Mr. Bland served as Vice President and General  Manager of WTAP-TV
serving Parkersburg,  West Virginia. Mr. Bland also served as General Manager of
WTAP-TV  from January 1990 until March 1995,  General  Sales  Manager of WIFR-TV
serving   Rockford,   Illinois  from  September  1989  until  January  1990  and
Local/Regional Sales Manager of WIFR-TV from July 1987 until September 1989.

     Ms. Mary L. Flodin is the Vice President and Controller of the Company. Ms.
Flodin has also held the same positions at Benedek Broadcasting since 1990. From
1988 to 1990,  Ms.  Flodin served as  Controller  of Benedek  Broadcasting.  Ms.
Flodin has also served as Vice  President  and  Controller of each of Blue Grass
and Youngstown from 1990 until the Merger.  From 1983 to 1988, Ms. Flodin served
in various financial capacities as Vice President of AMCORE Financial, Inc.

     Mr. Jay L. Kriegel has been engaged in the communications industry for over
20 years.  Since March 1994,  Mr.  Kriegel has been a counselor  with the public
relations firm of Abernathy  MacGregor  Scanlon.  From 1988 to 1994, Mr. Kriegel
was Senior Vice  President of CBS Inc.  Mr.  Kriegel has served as a Director of
Benedek  Broadcasting  since May 1994 and as a Director of the Company since its
inception.

     Mr. Paul S.  Goodman  has been  corporate  counsel to Benedek  Broadcasting
since 1983 and the Company  since its formation in 1996.  Since April 1993,  Mr.
Goodman has been a member of the law firm of Shack & Siegel,  P.C.  From January
1990 to April  1993,  Mr.  Goodman  was a member  of the law firm of  Whitman  &
Ransom.  Mr.  Goodman  has served as a Director  of Benedek  Broadcasting  since
November 1994 and as a Director of the Company since its inception.

     In addition to the foregoing persons, the Company recently added two senior
executives to its corporate staff.

     Mr.  Raymond J.  Schonbak was hired  effective  April 1, 1997 to serve as a
Senior Vice President of Benedek Broadcasting.  Mr. Schonbak was the founder and
President of US Broadcast  Group of Shelton,  Connecticut  from 1995 to 1997. He
served as the CEO of Triad Communications of San Francisco, California from 1991
to 1995. Before that, he held a variety of management positions in the broadcast
field beginning in 1970.

     Mr.  Raymond P.  Maselli was  promoted to Senior Vice  President of Benedek
Broadcasting   effective   March  1997.   Mr.  Maselli  has  been  with  Benedek
Broadcasting  as Vice  President,  General  Manager of WYTV in Youngstown,  Ohio
since  1989.  He was the Vice  President  of Sales  and  Programming  for WGR of
Buffalo, New York from 1983 to 1989. He started his broadcast career in 1965.

     All  directors  hold office  until their  successors  are duly  elected and
qualify.  Executive  officers  of the  Company  are  appointed  by the  Board of
Directors and serve at the Board's discretion. Directors of the Company received
no cash  compensation  for such services to the Company during 1994. In 1995 and
1996,  the  Company  paid each  director  who is not an  employee of the Company
$2,500 per quarter and $500 per Board meeting for his services as a director. No
family relationship exists between any of the executive officers or directors of
the Company.

                                      -42-



<PAGE>



ITEM 11.      EXECUTIVE COMPENSATION.

EXECUTIVE COMPENSATION.

     The  following  table  sets  forth  certain   information   concerning  the
compensation  paid to the Company's Chief  Executive  Officer and the other four
most  highly-compensated  executives  during the fiscal years ended December 31,
1996,  December 31, 1995 and  December  31,  1994.  The amounts set forth in the
following table for 1994 include amounts paid to the listed  executive  officers
by Benedek Group,  Inc. which was owned by Messrs.  Benedek,  Yager and Lindwall
and which provided management and accounting services to the Company during part
of 1994.

                           SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
                                                                       ANNUAL COMPENSATION
                                                                       -------------------
                                                                                                                 ALL
                                                                                                                OTHER
             NAME AND PRINCIPAL POSITION                YEAR           SALARY($)          BONUS($)           COMPENSATION($)(A)
             ---------------------------                ----           ---------          --------           ------------------
<S>                                                     <C>              <C>               <C>                 <C>

A. Richard Benedek, Chairman and                        1996             525,000            --                       --
  Chief Executive Officer                               1995             475,000            --                       --
                                                        1994             450,000            --                       --

K. James Yager, President                               1996             406,586             --                    2,293
                                                        1995             344,950             --                    2,300
                                                        1994             307,550             --                    2,700

Ronald L. Lindwall, Senior Vice President-              1996             150,000         25,000                    2,293
  Finance, Chief Financial Officer, Secretary           1995             107,652         55,000                    2,310
  and Treasurer                                         1994             109,808         10,000                    1,859

Terrance F. Hurley, Senior Vice President               1996             141,114         25,000                    1,498

Douglas E. Gealy, Executive Vice President (b)          1996             161,867             --                       --
</TABLE>

---------------------------
(a)  Represents the amount of the Company's contribution under its 401(k) plan.
(b)  Mr. Gealy is no longer employed by the Company.

     The following  table sets forth the value, at December 31, 1996, of options
to purchase  common stock of the Company  held by the  President of the Company,
all of which are exercisable. No other executive officer holds any options.

                          FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
                                                Number of Securities                          Value of Unexercised
                                           Underlying Unexercised Options                    In-the-Money Options at
                                                 at Fiscal Year-End                              Fiscal Year-End
                                      -----------------------------------------  --  ---------------------------------------
                Name                       Exercisable         Unexercisable             Exercisable        Unexercisable
                ----                       -----------         -------------             -----------        -------------
<S>                                         <C>                 <C>                     <C>                   <C>
K. James Yager.......................       370,000                --                  $1,842,000(a)            --
</TABLE>

---------------------------
(a)  The value of the  options  at  December  31,  1996 is based upon a multiple
     Adjusted  EBITDA.   The  Company  believes  this  method  of  valuation  is
     reasonable  because there is no public market for the shares underlying the
     options and Adjusted  EBITDA best  represents the  underlying  value of the
     Company.  The multiple chosen by the Company is based on existing broadcast
     market conditions.  All of Mr. Yager's options are immediately exercisable.
     The foregoing options, in the aggregate,  will entitle Mr. Yager to acquire
     shares  representing  5% of the  outstanding  common  stock of the Company,
     after  giving  effect to the  issuance  thereof  but prior to any  dilution
     resulting from the exercise of any of the warrants.

                                      -43-



<PAGE>



EMPLOYMENT AGREEMENTS

     Mr. Benedek is employed by Benedek  Broadcasting  pursuant to an employment
agreement  that  expires May 31,  2000.  During the term of the  agreement,  Mr.
Benedek  is to be paid at a rate  per  annum  of not  less  than  $525,000.  The
employment  agreement  requires Mr. Benedek to devote  substantially  all of his
business time to the business of Benedek  Broadcasting and precludes Mr. Benedek
from   engaging  in  activities   competitive   with  the  business  of  Benedek
Broadcasting throughout the term of the employment agreement.

     Mr.  Yager is employed by Benedek  Broadcasting  pursuant to an  employment
agreement that expires May 31, 2000. During the term of the agreement, Mr. Yager
is to be paid at a rate per  annum of not less  than  $400,000.  The  employment
agreement  requires Mr. Yager to devote his full time to the business of Benedek
Broadcasting  and precludes  Mr. Yager from  engaging in activities  competitive
with the business of Benedek Broadcasting  throughout the term of the employment
agreement.

     Mr. Lindwall is employed by Benedek Broadcasting  pursuant to an employment
agreement  that  expires May 31,  1999.  During the term of the  agreement,  Mr.
Lindwall  is to be paid at a rate  per  annum  of not less  than  $150,000.  The
employment  agreement  requires  Mr.  Lindwall  to  devote  his full time to the
business of Benedek Broadcasting.

     Mr.  Hurley is employed by Benedek  Broadcasting  pursuant to an employment
agreement  that  expires May 31,  1999.  During the term of the  agreement,  Mr.
Hurley  is to be paid  at a rate  per  annum  of not  less  than  $150,000.  The
employment agreement requires Mr. Hurley to devote his full time to the business
of Benedek  Broadcasting  and  precludes  Mr. Hurley from engaging in activities
competitive with the business of Benedek Broadcasting throughout the term of the
employment  agreement  and for a period of one year  thereafter  with respect to
designated  market  areas then served by a television  station  owned by Benedek
Broadcasting.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     Messrs.  Benedek, Yager and Lindwall, all of whom are executive officers of
the Company, serve as Directors of the Company.  Presently, the Company does not
have  a  compensation   committee.   Compensation  for  executive   officers  is
recommended to the Board of Directors by the Chief Executive Officer.  In making
his compensation recommendations,  the Chief Executive Officer considers several
criteria, including the Company's performance and growth, industry standards for
similarly situated companies and experience and qualitative  performance of such
executive officers.

     In March 1995,  in connection  with the  formation of the LLC, Mr.  Benedek
acquired a 1% membership interest in LLC in exchange for a non-interest  bearing
promissory  note in the principal  amount of $581,200.  Mr. Benedek entered into
this transaction as an accommodation to Benedek Broadcasting in conjunction with
its issuance of the Senior Secured Notes. In connection  with the  Transactions,
the LLC was merged into BLC, and Mr.  Benedek was issued one share of BLC common
stock in exchange  for his 1% interest in the LLC,  which share was  redeemed in
exchange for cancellation of the promissory note.

ITEM 12.      SECURITY OWNERSHIP OF CERTAIN
              BENEFICIAL OWNERS AND MANAGEMENT.

     Mr. Benedek owns  7,030,000  shares of Class B common stock of the Company,
representing all of its outstanding common stock.

                                      -44-



<PAGE>



     Mr. Yager holds options to purchase  370,000 shares of Class B common stock
of the Company for an aggregate  purchase price of  approximately  $1.2 million.
All of Mr. Yager's options are immediately exercisable.

ITEM 13.      CERTAIN RELATIONSHIPS AND
              RELATED TRANSACTIONS.

     Paul S.  Goodman,  a member of the law firm of Shack & Siegel,  P.C.,  is a
director of the Company.  During the fiscal year ended  December  31, 1996,  the
Company paid approximately $1,062,000 for legal services to Shack & Siegel, P.C.

                                      -45-



<PAGE>



                                     PART IV

ITEM 14.      EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

     (a)(1)   Consolidated Financial Statements of the Company.

<TABLE>
<CAPTION>
                                                                                                                Page
                                                                                                                ----
<S>                                                                                                             <C>
Benedek Communications Corporation
  and Subsidiaries
    Independent Auditor's Report.......................................................................          F-2
    Consolidated Balance Sheets as of December 31, 1995 and 1996.......................................          F-3
    Consolidated Statements of Operations for the Three Years Ended
      December 31, 1996................................................................................          F-4
    Consolidated Statements of Stockholder's Deficit for the Years Ended
      December 31, 1994, 1995 and 1996.................................................................          F-5
    Consolidated Statements of Cash Flows for the Three Years Ended
      December 31, 1996................................................................................          F-6
    Notes to Consolidated Financial Statements.........................................................          F-8

  (a)(2) Schedule II...................................................................................          S-2
</TABLE>

     All  other  schedules  for  which  provision  is  made  in  the  applicable
regulations of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable and, therefore, have been omitted.

                                      -46-



<PAGE>


                  EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)

                                     PART IV

(a)(3)   Exhibits.

    3.1   --  Certificate  of  Incorporation  of  the  Registrant,  as  amended,
              incorporated  by  reference  to  Exhibit  3.1 to the  Registrant's
              Registration  Statement on Form S-4, File No. 333-09529,  filed on
              August 2, 1996 (the "S-4 Registration Statement").

    3.2   --  By-Laws of the Registrant, incorporated  by reference  to  Exhibit
              3.2 to the S-4 Registration Statement.

    3.3   --  Certificate  of   Designation  of  the   Powers,  Preferences  and
              Relative,  Participating,  Optional  and Other  Special  Rights of
              15.0% Exchangeable  Redeemable Senior Preferred Stock Due 2007 and
              Qualifications, Limitations and Restrictions thereof, incorporated
              by reference to Exhibit 3.3 to the S-4 Registration Statement.

    3.4   --  Certificate   of    Designation,   Preferences    and    Relative,
              Participating,  Optional  and  Other  Special  Rights  of Series C
              Junior Discount  Preferred Stock and  Qualifications,  Limitations
              and Restrictions thereof, incorporated by reference to Exhibit 3.4
              to the S-4 Registration Statement.

    4.1   --  Indenture  dated as of  May 15, 1996  between the   Registrant and
              United States Trust  Company of New York,  relating to the 13-1/4%
              Senior  Subordinated  Discount  Notes  due 2006,  incorporated  by
              reference to Exhibit 4.1 to the S-4 Registration Statement.

    4.2   --  Form  of  13-1/4%  Senior  Subordinated  Discount  Note  due  2006
              (included  in Exhibit 4.1  hereof),  incorporated  by reference to
              Exhibit 4.2 to the S-4 Registration Statement.

    4.3   --  Indenture dated as of  March 1, 1995  between Benedek Broadcasting
              Corporation  ("Benedek  Broadcasting")  and  The Bank of New York,
              relating to the 11-7/8% Senior Secured Notes  due  2005 of Benedek
              Broadcasting,  incorporated by reference to Exhibit 4.3 to the S-4
              Registration Statement.

    4.4   --  Form   of  11-7/8%  Senior  Secured  Note  due  2005  of   Benedek
              Broadcasting  (included  in Exhibit 4.3 hereof),  incorporated  by
              reference to Exhibit 4.4 to the S-4 Registration Statement.

    4.5   --  Certificate   of   Designation  of  the  Powers,  Preferences  and
              Relative,  Participating,  Optional  and Other  Special  Rights of
              15.0% Exchangeable  Redeemable Senior Preferred Stock due 2007 and
              Qualifications,  Limitations  and  Restrictions  thereof (filed as
              Exhibit 3.3 hereof),  incorporated  by reference to Exhibit 4.5 to
              the S-4 Registration Statement.

    4.6   --  Certificate   of    Designation,    Preferences    and   Relative,
              Participating, Optional  and  Other  Special  Rights  of  Series C
              Junior Discount  Preferred Stock and  Qualifications,  Limitations
              and   Restrictions   thereof   (filed  as  Exhibit  3.4   hereof),
              incorporated  by reference to Exhibit 4.6 to the S-4  Registration
              Statement.

    4.7   --  Warrant   Agreement   dated  as   of  June  5,  1996  between  the
              Registrant  and IBJ Schroder  Bank & Trust Company with respect to
              Class A Common Stock of the Registrant,  incorporated by reference
              to Exhibit 4.7 to the S-4 Registration Statement.

  10.1    -- Purchase  Agreement  dated   May  30,  1996 between the  Registrant
              and  Goldman,  Sachs & Co.,  incorporated  by reference to Exhibit
              10.1 to the S-4 Registration Statement.

  10.2    -- Exchange and  Registration  Rights  Agreement  dated  May 30,  1996
              between the  Registrant  and Goldman,  Sachs & Co. with respect to
              the 13-1/4%  Senior  Subordinated  Discount  Notes due 2006 of the
              Registrant,  incorporated  by reference to Exhibit 10.2 to the S-4
              Registration Statement.

                                      -47-



<PAGE>



  10.3    --  Placement  Agreement  dated  June 5, 1996  among  the  Registrant,
              Goldman, Sachs & Co. and BT Securities  Corporation,  incorporated
              by reference to Exhibit 10.3 to the S-4 Registration Statement.

  10.4    --  Exchange and  Registration  Rights  Agreement  dated  June 5, 1996
              among  the  Registrant,  Goldman,  Sachs & Co.  and BT  Securities
              Corporation  with  respect  to the 15.0%  Exchangeable  Redeemable
              Senior Preferred Stock due 2007 of the Registrant, incorporated by
              reference to Exhibit 10.4 to the S-4 Registration Statement.

  10.5    --  Warrant Agreement dated as of June 5, 1996 between  the Registrant
              and  IBJ  Schroder  Bank  &  Trust  Company  (filed as Exhibit 4.7
              hereof),  incorporated by reference to  Exhibit 10.5  to  the  S-4
              Registration Statement.

  10.6    --  Contingent  Warrant Escrow Agreement dated  June 5,  1996  between
              the Registrant and IBJ Schroder Bank & Trust Company, incorporated
              by reference to Exhibit 10.6 to the S-4 Registration Statement.

  10.7    --  Common Stock Registration  Rights Agreement dated  as  of  June 5,
              1996 among the Registrant,  Goldman, Sachs & Co. and BT Securities
              Corporation,  incorporated by reference to Exhibit 10.7 to the S-4
              Registration Statement.

  10.8    --  Credit Agreement dated as of June 6,  1996  among  the Registrant,
              Benedek  Broadcasting,  the Lenders listed  therein,  Pearl Street
              L.P., Goldman, Sachs & Co. and Canadian Imperial Bank of Commerce,
              New York Agency,  incorporated by reference to Exhibit 10.8 to the
              S-4 Registration Statement.

  10.9    --  Guaranty dated as of June 6, 1996  by  the  Registrant in favor of
              Canadian Imperial Bank of Commerce, New York Agency,  incorporated
              by reference to Exhibit 10.9 to the S-4 Registration Statement.

  10.10   --  Pledge Agreement dated as of June 6, 1996  between  the Registrant
              and  Canadian  Imperial  Bank   of  Commerce,  New  York   Agency,
              incorporated by reference to Exhibit 10.10 to the S-4 Registration
              Statement.

  10.11   --  Security Agreement dated as of June 6, 1996 between the Registrant
              and  Canadian  Imperial  Bank  of   Commence,  New   York  Agency,
              incorporated by reference to Exhibit 10.11 to the S-4 Registration
              Statement.

  10.12   --  Collateral Account  Agreement dated as of June 6, 1996 between the
              Registrant  and  Canadian  Imperial  Bank  of  Commerce,  New York
              Agency, incorporated  by  reference  to Exhibit  10.12 to  the S-4
              Registration Statement.

  10.13   --  Third Party Account  Agreement  dated as of June 6, 1996 among the
              Registrant, AMCORE Bank, N.A., Rockford and Canadian Imperial Bank
              of Commerce, New York Agency, incorporated by reference to Exhibit
              10.13 to the S-4 Registration Statement.

  10.14   --  Form of Indemnity Agreement between the Registrant and each of its
              executive officers and  directors,  incorporated  by  reference to
              Exhibit 10.14 to the S-4 Registration Statement.

 *10.15   --  Option Agreement dated as of June 6, 1996 between  the  Registrant
              and K. James Yager.

  10.16   --  Employment  Agreement  dated  as  of  June  6,  1996  between  the
              Registrant and A. Richard  Benedek,  incorporated  by reference to
              Exhibit 10.16 to the S-4 Registration Statement.

  10.17   --  Employment  Agreement  dated  as  of  June  6,  1996  between  the
              Registrant  and K.  James  Yager,  incorporated  by  reference  to
              Exhibit  10.17  to  the  S-4  Registration  Statement.


  10.18   --  Employment  Agreement  dated  as  of  June  6,  1996  between  the
              Registrant  and Ronald L. Lindwall,  incorporated  by reference to
              Exhibit 10.19 to the S-4 Registration Statement.

  10.19   --  Employment  Agreement  dated  as  of  June  6,  1996  between  the
              Registrant  and Terrance F. Hurley,  incorporated  by reference to
              Exhibit 10.20 to the S-4 Registration Statement.

  10.20   --  Limited Waiver and First Amendment to Credit Agreement dated as of
              October  31,  1996  among  the  Registrant,  Benedek  Broadcasting
              Corporation, Goldman Sachs Credit Partners L.P., the

                                      -48-



<PAGE>


              lenders listed therein and Canadian Imperial Bank of Commerce, New
              York Agency, as Administrative Agent, incorporated by reference to
              Exhibit 10.21 to the Registrant's  Quarterly  Report on  Form 10-Q
              for the quarter ended September 30, 1996.

 *10.21   --  Limited Waiver and Second  Amendment  to  Credit  Agreement  dated
              as  of   February   28,   1997  among  the   Registrant,   Benedek
              Broadcasting  Corporation,  Goldman Sachs  Credit  Partners  L.P.,
              the lenders listed therein and Canadian Imperial Bank of Commerce,
              New York Agency, as Administrative Agent.

 *21      --   Subsidiaries of the Company.

 *23      --   Consent of McGladrey & Pullen, LLP with respect to the Company.

 *27      --   Financial Data Schedule pursuant to Article 5 of Regulation S-X.

---------------
*Filed herewith

     (b) Reports on Form 8-K

         None.

                                      -49-



<PAGE>




                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, as amended,  the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                                           BENEDEK COMMUNICATIONS CORPORATION
                                           (REGISTRANT)

                                            By:  /s/ A. RICHARD BENEDEK
                                               .............................
                                                     A. Richard Benedek
                                            Chairman and Chief Executive Officer

                                            DATE:   March 27, 1997

     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended,  this report has been signed by the following  persons on behalf of the
Registrant and in the capacities and on the dates indicated.

<TABLE>
<S>                                      <C>                                              <C>
              SIGNATURE                       CAPACITY IN WHICH SIGNED                   DATE
        /s/ A. RICHARD BENEDEK          Chairman and Chief Executive Officer             March 27, 1997
 ....................................     (Principal Executive Officer) and
          A. Richard Benedek              Director

          /s/ K. JAMES YAGER            President and Director                           March 27, 1997
 ....................................
            K. James Yager

        /s/ RONALD L. LINDWALL          Senior Vice President-Finance, Chief             March 27, 1997
 ....................................     Financial Officer, Secretary and
          Ronald L. Lindwall             Treasurer (Principal Financial and
                                         Accounting Officer) and Director

            /s/ JAY KRIEGEL             Director                                         March 27, 1997
 ....................................
              Jay Kriegel

          /s/ PAUL S. GOODMAN           Director                                         March 27, 1997
 ....................................
            Paul S. Goodman
</TABLE>

                                      -50-



<PAGE>



                          INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
                                                                                                            PAGE
                                                                                                            ----
<S>                                                                                                         <C>
Benedek Communications Corporation
  and Subsidiaries
    Independent Auditor's Report.......................................................................     F-2
    Consolidated Balance Sheets as of December 31, 1995 and 1996.......................................     F-3
    Consolidated Statements of Operations for the Three Years Ended
      December 31, 1996................................................................................     F-4
    Consolidated Statements of Stockholder's Deficit for the Years Ended
      December 31, 1994, 1995 and 1996.................................................................     F-5
    Consolidated Statements of Cash Flows for the Three Years Ended
      December 31, 1996................................................................................     F-6
    Notes to Consolidated Financial Statements.........................................................     F-8

                                       F-1



<PAGE>



                          INDEPENDENT AUDITOR'S REPORT

To the Board of Directors

Benedek Communications Corporation and Subsidiaries
Rockford, Illinois

     We have audited the  accompanying  consolidated  balance  sheets of Benedek
Communications Corporation and subsidiaries as of December 31, 1995 and 1996 and
the related consolidated  statements of operations,  stockholder's  deficit, and
cash flows for the years ended December 31, 1994, 1995 and 1996. These financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

     We conducted  our audits in accordance  with  generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion,  the consolidated  financial  statements  referred to above
present  fairly,  in all material  respects,  the financial  position of Benedek
Communications Corporation and subsidiaries as of December 31, 1995 and 1996 and
the  results  of their  operations  and their  cash  flows  for the years  ended
December  31,  1994,  1995 and  1996,  in  conformity  with  generally  accepted
accounting principles.

                                                     /s/ McGLADREY & PULLEN, LLP

Rockford, Illinois
February 28, 1997

                                       F-2



<PAGE>



               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

</TABLE>
<TABLE>
<CAPTION>
                                                                                         December 31,                 December 31,
                              ASSETS (Note G)                                               1995                          1996
                                                                                         -------------                -------------
<S>                                                                                       <C>                          <C>
Current Assets
   Cash and cash equivalents .............................................               $   9,668,331                $   8,091,683
   Receivables
      Trade, less allowance for doubtful accounts of $249,023
          $249,023 and $483,519 for 1996 and 1996, respectively $ ........                  23,744,311
        and $483,519, for 1995 and 1996, respectively ....................                   9,918,633                   23,744,311
      Due from Network ...................................................                   2,500,000                         --
      Due from Seller ....................................................                        --                        474,011
      Other ..............................................................                     111,063                      385,063
   Current portion of program broadcast rights ...........................                   1,575,325                    4,427,832
   Prepaid expenses ......................................................                     576,697                    1,453,007
   Deferred income taxes .................................................                        --                      1,333,000
                                                                                         -------------                -------------
                  TOTAL CURRENT ASSETS ...................................                  24,350,049                   39,908,907
                                                                                         -------------                -------------
Property and Equipment (Note D) ..........................................                  20,035,715                   84,021,301
                                                                                         -------------                -------------
Intangible Assets (Note E) ...............................................                  60,420,617                  354,622,296
                                                                                         -------------                -------------
Other Assets

   Program broadcast rights, less current portion (Note H) ...............                     687,320                    2,298,365
   Deposit on acquisition ................................................                   3,000,000                         --
   Acquisition costs .....................................................                     225,359                         --
   Deferred loan costs ...................................................                   5,625,261                   13,385,766
   Land held for sale ....................................................                     109,000                      109,000
   Other .................................................................                        --                        670,605
                                                                                         -------------                -------------
                                                                                             9,646,940                   16,463,736
                                                                                         -------------                -------------
                                                                                         $ 114,453,321                $ 495,016,240
                                                                                         =============                =============
                   LIABILITIES AND STOCKHOLDER'S DEFICIT
Current Liabilities
   Current maturities of notes payable ...................................               $     318,077                $  14,015,273
   Current maturities of program broadcast rights payable ................                   2,042,643                    6,119,953
   Accounts payable and accrued expenses (Note I) ........................                   7,824,296                   15,368,581
   Deferred revenue ......................................................                     500,000                      707,347
                                                                                         -------------                -------------
                  TOTAL CURRENT LIABILITIES ..............................                  10,685,016                   36,211,154
                                                                                         -------------                -------------
Long-Term Obligations
   Notes payable (Note G) ................................................                 135,448,948                  344,219,003
   Program broadcast rights payable (Note H) .............................                     632,444                    1,592,400
   Deferred revenue ......................................................                   4,250,000                    4,435,165
   Deferred income taxes .................................................                        --                     54,600,000
                                                                                         -------------                -------------
                                                                                           140,331,392                  404,846,568
                                                                                         -------------                -------------
Exchangeable redeemable senior preferred stock (Note F) ..................                        --                     58,462,223
                                                                                         -------------                -------------
Seller junior discount preferred stock (Note F) ..........................                        --                     47,057,040
                                                                                         -------------                -------------
Commitments (Note H, J) Stockholder's Deficit (Note C, F, L)
   Common stock, Class A $0.01 par value 25,000,000
      authorized, none issued or outstanding .............................                        --                           --
   Common stock, Class B $0.01 par value 25,000,000
      authorized, 7,030,000 issued and outstanding .......................                      70,300                       70,300
   Additional paid-in capital ............................................                   2,253,229                  (35,346,586)
   Accumulated deficit ...................................................                 (38,886,616)                 (16,284,459)
                                                                                         -------------                -------------
                                                                                           (36,563,087)                 (51,560,745)
                                                                                         -------------                -------------
                                                                                         $ 114,453,321                $ 495,016,240
                                                                                         =============                =============
</TABLE>



    The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       F-3



<PAGE>



               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                             Years Ended December 31,
                                                         -----------------------------------------------------------------
                                                                  1994                    1995                   1996
                                                                  ----                    ----                   ----
<S>                                                         <C>                   <C>                      <C>
Net revenues...........................................  $       44,221,027      $       50,329,019      $      96,386,124
                                                         ------------------      ------------------     ------------------
Operating expenses:
   Selling, technical and program expenses.............          17,739,786              21,199,067             43,758,586
   General and administrative..........................           7,069,730               7,849,845             14,843,901
   Depreciation and amortization.......................           3,403,263               5,041,719             20,219,589
   Corporate (Note C)..................................           1,308,984               1,575,792              2,695,461
                                                         ------------------      ------------------     ------------------
                                                                 29,521,763              35,666,423             81,517,537
                                                         ------------------      ------------------     ------------------
      OPERATING INCOME.................................          14,699,264              14,662,596             14,868,587
                                                         ------------------      ------------------     ------------------
Financial income (expense):
   Interest expense (Note A):
      Cash interest....................................          (7,904,530)            (15,159,766)           (22,841,333)
      Other interest...................................          (4,904,834)               (711,934)            (8,129,924)
                                                         ------------------      ------------------     ------------------
                                                                (12,809,364)            (15,871,700)           (30,971,257)
   Interest income                                                  164,627                 397,460                282,289
   Other, net                                                       (10,168)                      -                      -
                                                         ------------------      ------------------     ------------------
                                                                (12,654,905)            (15,474,240)           (30,688,968)
                                                         ------------------      ------------------     ------------------
      INCOME (LOSS) BEFORE INCOME TAX BENEFIT AND
      EXTRAORDINARY ITEM...............................           2,044,359                (811,644)           (15,820,381)
Income tax benefit.....................................                   -                       -              4,663,829
                                                         ------------------      ------------------     ------------------
      INCOME (LOSS) BEFORE EXTRAORDINARY ITEM..........           2,044,359                (811,644)           (11,156,552)
Extraordinary item, gain on early
   extinguishment of debt (Note G).....................                   -               6,863,762                      -
                                                         ------------------      ------------------     ------------------
      NET INCOME (LOSS)................................           2,044,359               6,052,118            (11,156,552)
Preferred stock dividends and accretion................                   -                       -             (9,519,263)
                                                         ------------------      ------------------     ------------------
Net income (loss) applicable to common stock...........  $        2,044,359      $        6,052,118      $     (20,675,815)
                                                         ==================      ==================     ==================
Earnings (loss) per common share:
   Income (loss) before extraordinary item.............  $             0.29      $            (0.12)     $          (2.94)
   Extraordinary item..................................                   -                    0.98                     -
                                                         ------------------      ------------------     ------------------
   Earnings (loss) per common share....................  $             0.29      $             0.86      $          (2.94)
                                                         ===================     ==================     ==================
Weighted-average common shares outstanding.............           7,030,000               7,030,000             7,030,000
                                                         ===================     ==================     ==================

</TABLE>

   The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       F-4



<PAGE>



               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF STOCKHOLDER'S DEFICIT
                  YEARS ENDED DECEMBER 31, 1994, 1995 AND 1996


<TABLE>
<CAPTION>
                                                       Additional
                                               Common              Paid-In              Accumulated
                                                Stock              Capital                Deficit                 Total
                                            ------------      -----------------      -----------------     ------------------
<S>                                          <C>                 <C>                       <C>               <C>
Balance at December 31, 1993..............  .$    70,300      $       2,253,229         $  (46,983,093)      $    (44,659,564)
   Net income.............................             -                      -              2,044,359              2,044,359
                                            ------------      -----------------      -----------------     ------------------
Balance at December 31, 1994..............        70,300              2,253,229            (44,938,734)           (42,615,205)
   Net income.............................             -                      -              6,052,118              6,052,118
                                            ------------      -----------------      -----------------     ------------------
Balance at December 31, 1995..............        70,300              2,253,229            (38,886,616)           (36,563,087)
   Allocation of proceeds from sale of
      exchangeable redeemable senior
      preferred stock to initial warrants.             -              9,000,000                      -              9,000,000
   Accretion to exchangeable redeemable
      senior preferred stock
      (Note F)............................             -             (2,205,095)                     -            (2,205,095)
   Financial costs related to the sale of
      preferred stock.....................             -             (3,321,843)                     -            (3,321,843)
   Reclassification of accumulated deficit
      due to change in income tax status..             -            (41,072,877)            41,072,877                      -
   Dividends payable on preferred stock...             -                     -              (7,314,168)            (7,314,168)
   Net (loss).............................             -                     -             (11,156,552)           (11,156,552)
                                            ------------      -----------------      -----------------      -----------------
Balance at December 31, 1996..............  .$    70,300      $     (35,346,586)       $   (16,284,459)       $   (51,560,745)
                                            ============      =================      =================      =================
</TABLE>


The  accompanying  notes  are an  integral  part of the  consolidated  financial
statements.

                                       F-5



<PAGE>



               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                Years Ended December 31,
                                                              ------------------------------------------------------------
                                                                    1994                  1995                  1996
                                                                    ----                  ----                  ----
<S>                                                                <C>                  <C>                    <C>
Cash Flows From Operating Activities
   Net income (loss).........................................  $      2,044,359        $   6,052,118         $(11,156,552)
   Adjustments to reconcile net income (loss) to
      net cash provided by operating activities:
        Amortization of program broadcast rights.............         2,103,606            2,161,545             4,398,905
        Depreciation and amortization........................         2,133,940            3,268,939            13,809,443
        (Gain) on early extinguishment of debt...............                 -          (6,863,762)                     -
        Amortization of intangibles and deferred loan costs..         2,775,321            2,425,488             7,617,297
        Amortization of note discount........................                 -                    -             6,869,514
        (Gain) loss on sale of property and equipment........          (55,222)               27,535                29,851
        Payment of deferred and contingent interest..........                 -          (4,405,746)                     -
        Payment of prepayment premiums.......................                 -          (2,748,896)                     -
        Deferred income taxes................................                 -                    -           (4,758,859)
        Other................................................           166,730               31,691                     -
    Changes in operating assets and liabilities, net of
        effects of acquisitions:
        Receivables..........................................         (329,105)          (4,574,290)             (722,447)
        Due to sellers.......................................                 -                    -             2,187,723
        Prepaid expenses and other...........................         (102,858)             (48,023)             (266,267)
        Payments on program broadcast rights payable.........       (1,887,768)          (2,131,990)           (3,317,527)
        Accounts payable and accrued expenses................           357,041            4,738,408             3,566,204
        Deferred revenue.....................................                 -            4,750,000             (414,410)
        Deferred and contingent interest payable.............         3,287,331              567,533                     -
                                                              -----------------     ----------------      ----------------
        NET CASH PROVIDED BY OPERATING ACTIVITIES............        10,493,375            3,250,550            17,842,875
                                                              -----------------     ----------------      ----------------
Cash Flows From Investing Activities
   Purchase of property and equipment........................                                           (3,695,187)
   Progress payments on equipment not in service.............                 -                    -             (469,615)
   Proceeds from sale of equipment...........................            75,380              425,994               206,754
   Payment for acquisition of stations.......................                 -         (26,698,516)         (322,081,822)
   Deposit on acquisition....................................                 -          (3,000,000)                     -
   Advance to affiliate......................................       (2,000,000)                    -                     -
   Payment of acquisition costs..............................                 -            (225,359)                     -
   Purchase of other assets .................................                 -                    -             (670,605)
   Other ....................................................           (8,267)                4,504                78,834
                                                              -----------------     ----------------      ----------------
        NET CASH (USED IN) INVESTING ACTIVITIES..............       (2,507,058)         (30,972,270)         (326,631,641)
                                                              -----------------     ----------------      ----------------
Cash Flows From Financing Activities
   Principal payments on notes and capital leases payable....       (5,795,902)         (96,351,288)           (3,647,514)
   Proceeds from issuance of preferred stock.................                 -                    -           105,000,000
   Proceeds from long-term borrowing.........................                 -          135,000,000           218,178,200
   Payment of debt and preferred stock acquisition costs.....       (1,240,602)          (5,875,903)          (12,318,568)
                                                              -----------------     ----------------      ----------------
        NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES..       (7,036,504)           32,772,809           307,212,118
                                                              -----------------     ----------------      ----------------

        INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS.....           949,813            5,051,089           (1,576,648)

Cash and cash equivalents:
   Beginning.................................................         3,667,429            4,617,242             9,668,331
                                                              -----------------     ----------------      ----------------
   Ending....................................................  $      4,617,242      $     9,668,331       $     8,091,683
                                                              =================     ================      ================

                                                    (Continued)

</TABLE>

                                                        F-6



<PAGE>


                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
<TABLE>
<CAPTION>
                                                                                Years Ended December 31,
                                                              ------------------------------------------------------------
                                                                    1994                  1995                  1996
                                                                    ----                  ----                  ----
<S>                                                                <C>                  <C>                    <C>
Supplemental Disclosure of Cash Flow Information
   Cash payments for interest................................  $      7,904,530       $   13,654,225        $   20,945,188
                                                              =================     ================      ================
Supplemental Schedule of Noncash Investing and
   and Financing Activities
   Acquisition of program broadcast rights...................  $      2,044,692      $     2,558,122       $     4,629,978
   Note payable incurred for purchase of equipment...........           273,995              197,288             1,067,051
   Equipment acquired by barter transactions.................           312,965              331,843               161,114
   Dividends accrued on redeemable preferred stock...........                 -                    -             7,314,168
   Accretion to exchangeable redeemable senior
      preferred stock........................................                 -                    -             2,205,095
   Accounts payable transferred to note payable..............            88,079                    -                     -
                                                              =================     ================      ================
Acquisition of stations:
   Cash purchase price.......................................                         $   26,698,516         $ 322,081,822
                                                                                    ================      ================
   Net working capital acquired, excluding cash of $535,810
      in 1996................................................                       $                    - $     9,982,264
   Property and equipment acquired at fair market value......                              7,533,196            72,578,064
   Intangible assets acquired................................                             21,306,181           300,558,565
   Deferred income taxes assumed.............................                                      -          (58,025,859)
   Other, net................................................                              (140,861)               214,147
                                                                                    ----------------      ----------------
                                                                                          28,698,516           325,307,181
   Less: Application of advance to affiliate.................                            (2,000,000)                     -
   Less: Amount paid in 1995.................................                                      -           (3,225,359)
                                                                                    ----------------      ----------------
                                                                                      $   26,698,516         $ 322,081,822
                                                                                    ================      ================


   The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       F-7



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(NOTE A) - NATURE OF BUSINESS,  BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES

NATURE OF BUSINESS:

     Benedek Communications  Corporation (the "Company") was formed on April 10,
1996.  The Company is a holding  company that derives its  operating  income and
cash  flow  from its  subsidiary,  Benedek  Broadcasting  Corporation  ("Benedek
Broadcasting")  which owns and  operates  twenty-two  television  stations  (the
"Stations")  located throughout the United States.  These stations operate under
network affiliation contracts, which provide programs to the affiliated stations
and the stations sell commercial time during the programs to national,  regional
and local  advertisers.  The  networks  also sell  commercial  time  during  the
programs to national  advertisers.  Credit  arrangements  are  determined  on an
individual customer basis.

BASIS OF PRESENTATION:

     The consolidated  financial  statements include the accounts of the Company
and its  wholly  owned  subsidiary  Benedek  Broadcasting  and  Benedek  License
Corporation  (BLC),  a wholly  owned  subsidiary  of Benedek  Broadcasting.  All
significant  intercompany  items and  transactions  have been  eliminated in the
consolidated  financial  statements.  Benedek  Broadcasting  and the Company had
identical  stock  ownership,  so  the  capitalization  of  the  Company  by  the
stockholder  with  Benedek  Broadcasting  stock  was  accounted  for in a manner
similar  to  pooling-of-interests   accounting.   These  consolidated  financial
statements include the consolidated financial statements of Benedek Broadcasting
for the period  prior to June 6, 1996  recast to reflect the  difference  in par
value of the Company's and Benedek Broadcasting's stock.

SIGNIFICANT ACCOUNTING POLICIES:

(1)  ACCOUNTING ESTIMATES:

     The  preparation  of  financial  statements  requires  management  to  make
estimates  and  assumptions  that  affect  the  reported  amounts  in  financial
statements and the  accompanying  notes.  Actual results could differ from those
estimates.

(2)  CASH EQUIVALENTS AND CONCENTRATION:

     The Company  considers all highly liquid debt instruments  purchased with a
maturity of three months or less to be cash equivalents.

     At  various  times  during  the  periods,  the  Company  had  cash and cash
equivalents  on  deposit  with a  financial  institution  in excess  of  federal
depository  insurance limits.  The Company has not experienced any credit losses
on these deposits.

(3)  REVENUES:

     Revenue  related  to the  sale of  advertising,  network  compensation  and
contracted  time is recognized at the time of broadcast.  Net revenues are shown
net of agency and national representatives commissions.

                                       F-8



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     Deferred revenues primarily relate to compensation due from the network and
national  sales  representatives  at the  inception  of the network  affiliation
agreement and the national sales representative agreements,  respectively. These
revenues  are  recognized  over the  life of the  agreement  on a  straight-line
method.  Since  these  payments  are  earned  over  the  life of the  respective
agreements, the network affiliation payment is recognized over ten years and the
national sales representative payments are recognized over five years.

(4)  BARTER TRANSACTIONS:

     Revenue  from barter  transactions  (advertising  provided in exchange  for
goods and services) is recognized  as income when  advertisements  are broadcast
and  merchandise or services  received are charged to expense (or capitalized as
appropriate)  when received or used. The  transactions  are recorded at the fair
market value of the asset or service received.

(5)  PROGRAM BROADCAST RIGHTS AND LIABILITIES:

     Program  broadcast  rights  represent  rights for the  telecast  of feature
length motion pictures,  series produced for television and other films, and are
presented at the lower of amortized cost or net realizable value. Each agreement
is recorded as an asset and  liability  when the license  period  begins and the
program  is  available  for its first  showing.  Program  broadcast  rights  are
amortized  on a  straight-line  method over the life of the  contract,  which is
included  in  selling,  technical  and  program  expenses.  The  agreements  are
classified  between current and long-term assets according to the estimated time
of future  usage.  The  related  liability  is  classified  between  current and
long-term on the basis of the payment terms.

(6)  DEFERRED LOAN AND ACQUISITION COSTS:

     Deferred  loan costs are amounts  incurred  in  connection  with  long-term
financing.  The costs are amortized on a straight-line  method over the terms of
the related debt security. Costs incurred in connection with long-term financing
which is not  consummated are expensed at the point in time when the negotiation
on the  financing  ceases.  Costs  incurred in  connection  with the issuance of
preferred stock are included in stockholder's  deficit as a permanent  reduction
of additional paid-in capital.

     Acquisition  costs  are  amounts  incurred  in  connection  with  acquiring
additional  television stations.  Costs incurred in connection with acquisitions
which are not consummated are expensed at the point of time when the negotiation
on  the  acquisition   ceases.  The  acquisition  costs  related  to  successful
acquisitions  are treated as part of the purchase price and are allocated to the
assets purchased.

     Included in other  interest  for 1994 are costs of  approximately  $900,000
related to a financing not consummated.

                                       F-9



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(7)  PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS:

     (a) Property and equipment are recorded at cost and  depreciated  using the
         straight-line  method  over the  following  estimated  ranges of useful
         lives:

                                                                       Years
                                                                       ----
                           Buildings and improvements                  5-40
                           Towers                                      5-12
                           Transmission equipment                      3-10
                           Other equipment                             1-5

     The  Company  records  amortization  expense  on  leased  assets  with  the
depreciation  expense on owned assets.  Gains and losses on the  disposition  of
property  and  equipment  are  insignificant  and included in  depreciation  and
amortization on the consolidated statement of operations.

     (b)  Intangible  assets,  which include FCC licenses,  network  affiliation
agreements  and goodwill,  have been recorded at cost and are amortized  over 40
years using the straight-line method.

     (c) The Company  reviews  their  property  and  equipment  and  intangibles
annually to determine  potential  impairment by comparing the carrying  value of
the assets with the  undiscounted  anticipated  future cash flows of the related
property  before  interest  charges.  If the future cash flows are less than the
carrying value, the Company would obtain an appraisal on the property and adjust
the carrying value of the assets to the appraisal  value if the appraisal  value
is less than the carrying value.

(8)  OTHER INTEREST EXPENSE:

     Other  interest  expense  includes  interest due to the increase in the BBC
Warrants,  contingent  equity value,  accrued  interest  added to long-term debt
balances, deferred loan cost amortization,  financing costs not consummated, and
accretion of discounts.

(9)  INCOME TAXES:

     Deferred  taxes are  provided on a liability  method  whereby  deferred tax
assets are recognized for deductible temporary differences, operating losses and
tax credit  carryforwards.  Deferred tax  liabilities are recognized for taxable
temporary  differences.  Temporary  differences are the differences  between the
reported  amounts of assets and  liabilities  and their tax bases.  Deferred tax
assets are reduced by a valuation  allowance when, in the opinion of management,
it is more likely than not that some  portion or all of the  deferred tax assets
will not be realized.  Deferred tax assets and  liabilities are adjusted for the
effects  of changes  in tax laws and rates on the date of  enactment.  Reference
should  also be made to  (Note  K)  regarding  a change  in tax  status  and the
recording of deferred taxes upon change in status.

                                      F-10



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(10)  INTEREST RATE CAP AGREEMENT:

     Interest rate cap agreements  are used to manage  interest rate exposure by
hedging certain  liabilities.  Income and expense are accrued under the terms of
the agreement  based on the expected  settlement  payments and are recorded as a
component of interest income or expense.

(11)  EMPLOYEE BENEFITS:

     The  Company  has  a  defined   contribution  plan  covering  all  eligible
employees.  The  Company's  contribution  is at the  discretion  of the Board of
Directors.

     The Company  self-insures  for health  benefits  which are  provided to all
full-time  employees with specified  periods of service.  Insurance  coverage is
maintained by the Company for claims in excess of specific and annual  aggregate
limits.

     Benedek  Broadcasting  has elected to continue  accounting for  stock-based
compensation under Accounting Principles Board Opinion No. 25.

(12) EARNINGS (LOSS) PER COMMON SHARE:

     Earnings  (loss) per common  share is computed by  dividing  income  (loss)
after the  deduction  of preferred  dividends  and  accretion of the  redemption
prepayment   premium  and   amortization  of  the  initial   warrants,   by  the
weighted-average  number of common shares  outstanding.  The effect of the stock
options,  initial warrants and contingent warrants has not been reflected in the
computation  since their inclusion as common stock  equivalents for both primary
and fully-diluted earnings (loss) per share was anti-dilutive.

(NOTE B) - ACQUISITIONS, RELATED PARTY AND BUSINESS COMBINATIONS

     The Company was formed by the sole stockholder of Benedek Broadcasting.  On
June 6, 1996,  two  acquisition  agreements  entered into during 1995 by Benedek
Broadcasting were  consummated.  These agreements were to acquire (i) the assets
of the television broadcasting division of Stauffer Communications,  Inc., which
owned five  television  stations for a total purchase  price of $54,500,000  and
(ii) all the issued and  outstanding  capital  stock of  Brissette  Broadcasting
Corporation  which owned and operated eight  television  stations for a purchase
price  of  $270,000,000.  At  the  closing  of  these  acquisitions,   the  sole
stockholder of Benedek Broadcasting contributed all of the outstanding shares of
common stock of Benedek Broadcasting to the Company in exchange for the issuance
to him of all of the outstanding shares of common stock of the Company.

     On March 31, 1995,  the Company  acquired  substantially  all the assets of
WTVY-TV, a television station serving Dothan,  Alabama and Panama City, Florida,
for an aggregate purchase price of approximately $28,699,000.

     These  acquisitions  have been  accounted for under the purchase  method of
accounting.  Accordingly, the results of operations of the acquired stations are
included in the consolidated financial statements since the

                                      F-11



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

date of the  respective  acquisitions.  The purchase price has been allocated to
the acquired  assets and  liabilities  based on their relative fair values as of
the closing date. The excess of the purchase price over the net assets  received
from these  acquisitions  is being  amortized on a  straight-line  method over a
period of 40 years.

     The pro forma  results of  operations  and earnings per share for the years
ended December 31, 1994, 1995 and 1996,  assuming the acquisition of WTVY-TV had
taken place on January 1, 1994, and the acquisitions of Stauffer Communications,
Inc. and Brissette Broadcasting  Corporation had taken place on January 1, 1995,
are as follows:

</TABLE>
<TABLE>
<CAPTION>

                                                                             Year Ended December 31,
                                                       -------------------------------------------------------------------
                                                             1994                    1995                     1996
                                                             ----                    ----                     ----
<S>                                                    <C>                      <C>                      <C>
Net revenue..........................................  $      51,582,464       $      120,616,960       $      126,165,117
Operating expenses...................................         35,647,105              102,866,162              111,175,446
Financial expenses...................................         16,442,853               41,270,999               43,289,518
                                                       -----------------      -------------------      -------------------
   (Loss) before income tax benefit and extraordinary
        item.........................................          (507,494)             (23,520,201)             (28,299,847)
Income tax benefit...................................                  -                9,154,022                9,865,815
                                                       -----------------      -------------------      -------------------
    (Loss) before extraordinary item.................          (507,494)             (14,366,179)             (18,434,032)
Extraordinary Item...................................                  -                6,863,762                        -
                                                       -----------------      -------------------      -------------------
   Net (loss)........................................          (507,494)              (7,502,417)             (18,434,032)
Preferred stock dividends and amortization...........                  -               17,261,191               19,395,023
                                                       -----------------      -------------------      -------------------
   Net (loss) applicable to common shares............  $        (507,494)      $     (24,763,608)       $     (37,829,055)
                                                       =================      ===================      ===================
Earnings (loss) per common share:
   Loss before extraordinary item....................  $           (0.07)      $           (4.50)       $           (5.38)
   Extraordinary item................................                  -                    0.98                        -
                                                       -----------------      -------------------      -------------------
   Loss per common share.............................  $           (0.07)      $           (3.52)       $           (5.38)
                                                       =================      ===================      ===================
Weighted-average common shares outstanding...........          7,030,000                7,030,000                7,030,000
                                                       =================      ===================      ===================
</TABLE>


(NOTE C) - RELATED PARTY TRANSACTIONS

(1)     ADMINISTRATIVE SERVICES:

     The Company paid management fees of  approximately  $1,309,000 in 1994 to a
company which was  affiliated  through  common  ownership.  These  services were
terminated January 1, 1995.

(2)     BENEDEK LICENSE CORPORATION:

     On April 18,  1996,  Benedek  Broadcasting  formed  BLC for the  purpose of
holding the licenses and authorizations issued by the FCC in connection with the
operations  of the Stations.  Concurrently  with the  acquisitions  described in
(Note B), Benedek  Broadcasting  Company,  L.L.C., which had been formed in 1995
for the same  purposes  and was  holding the  licenses  of Benedek  Broadcasting
stations,  was merged into BLC with the result that all licenses of the acquired
stations were  transferred to BLC. This was accounted for in a manner similar to
that in pooling-of-interests accounting.

                                      F-12



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(3)     STOCK OPTION AGREEMENTS:

     In 1988 and 1995, the Company  granted  options  whereby a key employee can
exercise  these options to purchase  130,784 shares and 239,216 shares of common
stock,  Class B, at  exercise  prices of $1.58  per  share and $4.12 per  share,
respectively,  which was the fair market values on the  respective  grant dates.
These  options will entitle the key  employee to shares  representing  5% of the
outstanding  common stock,  Class,  B, of the Company after giving effect to the
issuance  thereof and before the  conversion  of the  initial or the  contingent
warrants.  The 1988 and 1995 options are  exercisable  at any time and expire in
1998 and 2004,  respectively.  As permitted under generally accepted  accounting
principles,  the Company  accounts for the options  under the  provisions of APB
Opinion No. 25 and its related  interpretations.  Accordingly,  no  compensation
cost has been  recognized for the grant of the options.  Had  compensation  cost
been determined based on the fair value method  proscribed in FASB Statement No.
123, the reported net income  (loss) and earnings  (loss) per common share would
have been as follows:

    Year Ended            Net Income
   December 31,             (Loss)           Per Share
   ------------             ------           ---------
       1994              $ 2,044,359          $ 0.29
       1995                5,667,500            0.81
       1996              (20,675,815)          (2.94)

     In  determining  the pro forma  amounts,  the fair value per share for each
option for the 1995 grant was  estimated to be $2.68 per share at the grant date
by using the Black-Sholes  option-pricing model with the following  assumptions:
no dividends  will be paid on the common  stock,  Class B; a risk-free  interest
rate of 6.3%; an expected life of nine years;  and an expected price  volatility
of 45%.

     No  options  have  been  exercised  to date  and all  options  granted  are
outstanding  at  December  31,  1996.  The  following   summarizes  the  options
outstanding,  exercisable  and the  average  exercise  prices at the end of each
year.

                                                                   Weighted
    Year Ended              Options               Options           Average
   December 31,           Outstanding           Exercisable     Exercise Price
   ------------           -----------           -----------     --------------
       1994                  130,784               130,784      $     1.58
       1995                  370,000               370,000            3.22
       1996                  370,000               370,000            3.22


                                      F-13



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(NOTE D) - PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
                                                                                   December 31,
                                                                   --------------------------------------------
                                                                              1995                     1996
                                                                              ----                     ----
<S>                                                                   <C>                        <C>
Land and improvements.............................................    $       1,259,938          $    5,823,110
Buildings and improvements........................................           12,183,267              25,242,538
Towers............................................................            5,786,099              14,772,011
Transmission and studio equipment.................................           23,205,748              68,156,721
Office equipment..................................................            3,024,834               7,025,892
Records and tapes.................................................               22,732                 143,853
Transportation equipment..........................................              708,152               2,236,900
Construction in progress..........................................              150,188                 469,616
                                                                   --------------------      ------------------
                                                                             46,340,958             123,870,641
Less accumulated depreciation and amortization....................           26,305,243              39,849,340
                                                                   --------------------      ------------------
                                                                        $    20,035,715           $  84,021,301
                                                                   ====================      ==================
</TABLE>

(NOTE E) - INTANGIBLE ASSETS

   Intangible assets consist of the following:

<TABLE>
<CAPTION>
                                                                                  December 31,
                                                                  ---------------------------------------------
                                                                             1995                      1996
                                                                             ----                      ----
<S>                                                                   <C>                        <C>
Goodwill........................................................     $     28,837,585           $   167,631,166
FCC licenses....................................................           15,304,138               123,538,650
Network affiliations............................................           15,998,174                61,507,881
Other...........................................................              280,720                 1,944,599
                                                                  -------------------       -------------------
                                                                     $     60,420,617           $   354,622,296
                                                                  ===================       ===================
</TABLE>

     Intangible   assets  are  recorded  net  of  accumulated   amortization  of
$13,325,299 and $19,729,105 as of December 31, 1995 and 1996, respectively.

(NOTE F) - REDEEMABLE EQUITY SECURITIES AND DISCOUNT NOTES

     Concurrent with the acquisitions described in (Note B), the Company entered
into the  following  financing  transactions,  the net  proceeds  of which  were
contributed by the Company to Benedek Broadcasting.

   (1)  The Company sold 60,000 Units in a private  placement,  which  generated
        proceeds  of  $60,000,000.  Each  Unit  consists  of (i) ten  shares  of
        Exchangeable   Redeemable  Senior  Preferred  Stock,  (ii)  ten  Initial
        Warrants, and (iii) 14.8 Contingent Warrants.

                                      F-14



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

        (i)   Exchangeable  Redeemable  Senior  Preferred  Stock  - The  Company
              issued  600,000  shares  of  15%  Exchangeable  Redeemable  Senior
              Preferred Stock due 2007, with an initial  liquidation  preference
              equal to the proceeds received of $60,000,000.  Of these proceeds,
              $9,000,000  was  allocated  to the initial  warrants  described in
              (ii). The exchangeable  redeemable senior preferred stock is being
              accreted  to its initial  liquidation  preference  of  $60,000,000
              using the effective interest method commencing on June 6, 1996 and
              ending on July 1, 2000.  Dividends  are  payable to holders of the
              outstanding  shares  at the  rate of 15%  per  annum  of the  then
              effective  liquidation  preference  per share,  payable  quarterly
              beginning July 1, 1996 and accruing from June 6, 1996. The Company
              has the  option to pay  dividends  on any  dividend  payment  date
              occurring  on or before  July 1, 2001  either in cash or by adding
              such dividends to the then effective liquidation  preference.  The
              Company also has the option to immediately redeem these shares, in
              whole or in part, at predetermined  redemption prices. The Company
              is required to redeem the outstanding  shares on July 1, 2007 at a
              redemption  price equal to 100% of the then effective  liquidation
              preference  plus any accrued and unpaid  dividends  to the date of
              redemption.  The Exchangeable Redeemable Senior Preferred Stock is
              exchangeable into debentures at the Company's  option,  subject to
              certain  conditions,  in whole on any scheduled  dividend  payment
              due. The Exchangeable  Redeemable  Senior Preferred Stock has been
              registered with the Securities and Exchange Commission pursuant to
              a registration statement declared effective in October 1996.

        (ii)  Initial  Warrants - The Company  issued 600,000  Initial  Warrants
              which  expire on July 1, 2007 each of which  entitles  the  holder
              thereof to purchase  one share of Class A Common  Stock at a price
              of $0.01 per share.  The value of the warrants at date of issuance
              was $9,000,000 which was allocated to paid-in capital.

        (iii) Contingent  Warrants  -  The  Company  issued  888,000  Contingent
              Warrants,  each  warrant  to  acquire  one share of Class A Common
              Stock at an  exercise  price of $0.01 per  share.  The  Contingent
              Warrants  were issued to an escrow agent and are not  outstanding.
              The Contingent  Warrants are not separable  from the  Exchangeable
              Redeemable Senior Preferred Stock and will not be delivered out of
              escrow unless the Exchangeable  Redeemable  Senior Preferred Stock
              is  not  redeemed  on or  prior  to  July  1,  2000.  Since  it is
              management's  intention  to  redeem  the  Exchangeable  Redeemable
              Senior  Preferred  Stock  prior to any  release of the  Contingent
              Warrants  from  escrow  subject to a 15%  redemption  premium,  no
              allocation of the proceeds was made to the Contingent Warrants and
              the amount of the redemption premium payable at such time is being
              accreted as a constructive distribution over the period commencing
              on the issue date June 6, 1996 and ending on July 1, 2000.

   (2)  Seller Junior  Discount  Preferred  Stock - The Company  issued  450,000
        shares of Seller Junior  Discount  Preferred Stock due July 1, 2008 with
        an   aggregate   liquidation   preference   equal  to  the  proceeds  of
        $45,000,000.  Dividends  are payable to the holders of the Seller Junior
        Discount  Preferred Stock at 7.92% per annum until the fifth anniversary
        of the issuance  thereof and  thereafter at increasing  rates up to 18%.
        Since the Company intends to redeem the Seller Junior Discount Preferred
        Stock prior to the fifth anniversary, dividends are being accrued at the
        initial rate. The

                                      F-15



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

        dividends on the Seller Junior  Discount  Preferred Stock are cumulative
        from  date of  issuance.  Until the fifth  anniversary  of the  issuance
        thereof, dividend payments on the Seller Junior Discount Preferred Stock
        may not be made in cash and instead will be added  automatically  to the
        liquidation  preference  and as a result will be deemed paid in full and
        will not  accumulate.  The Seller  Junior  Discount  Preferred  Stock is
        subject to mandatory redemption in whole on July 1, 2008 and the Company
        has the  option  to redeem  these  shares in whole or in part at a price
        equal to the sum of the liquidation value per share plus an amount equal
        to all  accumulated  and  unpaid  dividends  per  share  to the  date of
        redemption.

   (3)  13 1/4% Senior Subordinated Discount Notes due 2006 - The Company issued
        Senior   Subordinated   Discount  Notes  with  a  principal   amount  of
        $170,000,000. These Notes were issued at a discount of $79,821,800 which
        generated  gross  proceeds of  $90,178,200.  The Notes mature on May 15,
        2006 and yield 13.25% per annum with no cash interest  accruing prior to
        May 15, 2001.  Thereafter,  cash  interest  will accrue  until  maturity
        payable semiannually,  commencing November 15, 2001. On or after May 15,
        2000, the Notes are redeemable at the option of the Company, in whole or
        in  part,  at  predetermined   redemption  prices  and  under  specified
        conditions.  The  Notes  are  subordinated  to all  Senior  Debt  of the
        Company. These Notes contain various restrictive covenants, all of which
        the Company was in  compliance  with at December  31,  1996.  The Senior
        Subordinated Discount Notes have been registered with the Securities and
        Exchange  Commission  pursuant  to  a  registration  statement  declared
        effective in October 1996.

   The following table summarizes these activities as follows:

<TABLE>
<CAPTION>
                                         Exchangeable
                                          Redeemable                                      Seller                 13 1/4%
                                            Senior                                    Junior Discount            Senior
                                          Preferred                Initial              Preferred            Subordinated
                                            Stock                 Warrants                Stock             Discount Notes
                                     --------------------     ------------------     -----------------      -----------------
<S>                                  <C>                       <C>                    <C>                   <C>
Issuance of preferred stock......... $         51,000,000      $       9,000,000      $     45,000,000      $               -
Issuance of senior subordinated
   discount notes...................                    -                      -                     -             90,178,200
Accrued dividends...................            5,257,128                      -             2,057,040                      -
Accretion of initial warrants and
   redemption prepayment
   premium on  exchangeable
   redeemable senior preferred
   stock............................            2,205,095            (2,205,095)                     -                      -
Amortization of note discount.......                    -                      -                     -              6,869,514
                                     --------------------     ------------------     -----------------      -----------------
Balance at December 31, 1996........ $         58,462,223      $       6,794,905      $     47,057,040       $     97,047,714
                                     ====================     ==================     =================      =================
</TABLE>

     Since the Company  derives all of its  operating  income and cash flow from
Benedek Broadcasting, the Company's ability to pay its obligations including (i)
interest  on and  principal  of the senior  subordinated  discount  notes,  (ii)
redemption of and cash dividends on the exchangeable  preferred stock, and (iii)
redemption of and cash dividends on the seller junior  discount  preferred stock
will be dependent  primarily  upon  receiving  dividends  and other  payments or
advances from Benedek Broadcasting. Benedek

                                      F-16



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Broadcasting  is a separate  and distinct  legal  entity and has no  obligation,
contingent  or  otherwise,  to pay any  amounts to the  Company or to make funds
available to the Company for debt service or any other obligation.

(NOTE G) - NOTES PAYABLE,  INTEREST RATE CAP, GAIN ON EXTINGUISHMENT OF DEBT AND
SUBSEQUENT EVENT

(1)     NOTES PAYABLE

     (a)  Term  Loans  and  Revolver.  As  part  of the  financing  transactions
described in Note F, on June 6, 1996,  Benedek  Broadcasting  entered into a new
credit  agreement  which includes two Term Loan  Facilities  consisting of (i) a
Series A  Facility  of  $70,000,000  at the  bank's  base rate plus 2.25% or the
Eurodollar  rate  plus  3.25% per annum  (currently  8.81%)  and (ii) a Series B
Facility of  $58,000,000  at the bank's  base rate plus 2.75% or the  Eurodollar
rate plus 3.75% per annum (currently  9.31%).  The Term Loan Facilities  provide
for quarterly  principal payments until final maturity (except in the first year
during which  amortization will be on a semiannual basis). The Series A Facility
and  the  Series  B  Facility  mature  on May 1,  2001  and  November  1,  2002,
respectively.  Benedek  Broadcasting  is  required to make  scheduled  aggregate
amortization  payments  on the Series A and  Series B  Facilities,  as  follows:
during the first year after closing, $6.0 million;  during the second year after
closing,  $11.0  million;  during the third year after  closing,  $14.5 million;
during the fourth year after closing, $16.0 million; during the fifth year after
closing, $27.5 million;  during the sixth year after closing, $15.0 million; and
during the first half of the seventh year after closing, $38.0 million.

     The  credit   agreement  also  includes  a  Revolving  Credit  Facility  of
$15,000,000,  which  bears  interest  at the bank's  base rate plus 2.25% or the
Eurodollar  rate plus 3.25% per annum.  There were no borrowings on the revolver
as of December 31, 1996.  The unused  portion of the Revolving  Credit  Facility
bears interest at 0.5% a month.

     The credit agreement also contains several mandatory  principal  prepayment
clauses,  one of which Benedek Broadcasting was subject to at December 31, 1996.
This clause stipulated that Benedek Broadcasting prepay the Term Loan Facilities
or must permanently  reduce the Revolving Credit Facility for an amount equal to
50% of the Consolidated Excess Cash Flow, as defined by the agreement,  no later
than 100 days after the end of the year.  Since it is management's  intention to
prepay  the  Term  Loan  Facilities,  Benedek  Broadcasting  has  reflected  the
additional  $5,122,000 as a current maturity of debt at December 31, 1996 rather
than permanently reducing the Revolving Credit Facility.

     The Term Loan  Facilities and the Revolving  Credit Facility are guaranteed
by  the  Company  and   secured  by  certain  of  the   Company's   and  Benedek
Broadcasting's  present and future property and assets. The Term Loan Facilities
are also  guaranteed  by BLC and are  collateralized  by all of the stock of BLC
which  is also  collateral  on the  Senior  Secured  Notes  which  have an equal
position  in the  stock  of BLC to the  Term  Loan  Facilities.  The  Term  Loan
Facilities contain various  restrictive  covenants and requires  compliance with
certain  financial ratios and covenants.  Benedek  Broadcasting is in compliance
with or has received  waivers  with respect to certain  covenants as of December
31, 1996.

                                      F-17



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     On February 28, 1997, Benedek  Broadcasting amended the credit agreement as
it relates to certain  restrictive  covenants and financial  ratios through June
30,  1998.  As part of the  amendment,  effective  February  28,  1997,  Benedek
Broadcasting  agreed to increase the interest  rate on the Term Loan  Facilities
and Revolving Credit Facility by an additional 50 basis points. They also agreed
to  reduce  the  available   Revolving   Credit  Facility  from  $15,000,000  to
$10,000,000.

     (b)  Senior  Secured  Notes.  During  1995,  Benedek   Broadcasting  issued
$135,000,000  of 11 7/8%  Senior  Secured  Notes due 2005 (the  "Senior  Secured
Notes").  The net proceeds of the Senior Secured Notes were used,  together with
available  cash  to  (i)  refinance  certain  indebtedness,   (ii)  finance  the
acquisition of WTVY- TV ("the Dothan Station"),  and (iii) pay fees and expenses
in connection  with the offering.  The Senior Secured Notes have been registered
with the Securities and Exchange Commission in a registration statement declared
effective in November 1995.

     The Senior  Secured  Notes  bear  interest  at the rate of 11 7/8%  payable
semiannually  on March 1 and  September 1 of each year and mature in March 2005.
The Senior Secured Notes may be redeemed by Benedek  Broadcasting in whole or in
part after  March 1, 2000  subject to certain  prepayment  premiums.  The Senior
Secured  Notes  contain  various  restrictive  covenants  relating to prepayment
premiums.  The  Senior  Secured  Notes  contain  various  restrictive  covenants
relating to  limitations on dividends,  transactions  with  affiliates,  further
issuance of debt, and the sales of assets,  among others.  Benedek  Broadcasting
was in compliance with these covenants at December 31, 1996.

     The Senior  Secured  Notes are  collateralized  by all of the stock of BLC,
which  is also  collateral  on the  Term  Loan  Facilities  which  have an equal
position in the stock of BLC to the Senior Secured. The Senior Secured Notes are
also  collateralized  by certain  agreements and contract  rights related to the
Stations  which includes  network  affiliation  agreements  and certain  general
intangibles.

   Notes payable consist of the following:
<TABLE>
<CAPTION>
                                                                      December 31,
                                              ------------------------------------------------
                                                      1995                       1996
                                                      ----                       ----
<S>                                           <C>                        <C>
Senior secured notes........................  $    135,000,000           $    135,000,000
Term loan series A..........................                 -                 67,500,000
Term loan series B..........................                 -                 57,500,000
Senior subordinated discount notes-
   see (Note F) for terms...................                 -                 97,047,714
Other.......................................           767,025                  1,186,562
                                              ------------------         ------------------
                                                   135,767,025                358,234,276
Less current maturities.....................           318,077                 14,015,273
                                              ------------------         ------------------
                                                $  135,448,948           $    344,219,003
                                              ==================         ==================
</TABLE>


                                      F-18



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

   At December 31, 1996, the notes provide for annual reductions as follows:

       Year Ending December 31,
    ---------------------------------
              1997...............       $   14,015,273
              1998...............           13,039,371
              1999...............           15,447,020
              2000...............           21,874,691
              2001...............           21,431,722
           Thereafter............          272,426,199
                                   -------------------
                                         $ 358,234,276
                                   ===================
(2)     INTEREST RATE CAP

     The Company  entered into an interest rate cap  agreement  which matures in
May 1998, to reduce the impact of changes in interest rates on its floating-rate
long-term debt. That agreement  effectively entitles the Company to receive from
a  financial  institution  the  amount,  if any,  by which the London  Interbank
Offering Rate (LIBOR) exceeds 7.36% on a notional  amount totaling  $125,000,000
subject to an amortization schedule. The $207,000 premium paid for this interest
rate cap is being amortized  ratably to interest  expense over the 18-month term
of the cap, and is reported as an other asset in the  accompanying  consolidated
balance sheets. LIBOR at December 31, 1996 was 5.63%.

     Although   the   Company  is  exposed  to  credit  loss  in  the  event  of
nonperformance by the counterparty on the interest rate cap, management does not
expect  nonperformance by the  counterparty.  (Note M) describes the methods and
assumptions used in estimating the fair value of these instruments, and provides
a  summary  of the  carrying  amount  and fair  values  of all of the  Company's
financial instruments.

(3)     GAIN ON EARLY EXTINGUISHMENT OF DEBT

     In  1995,   the  Company   recognized  an   extraordinary   gain  on  early
extinguishment  of debt consisting of subordinated  capital notes issued in 1986
with detachable stock purchase warrants. The extraordinary gain of approximately
$11,128,000  reduced by losses of  approximately  $1,140,000  from  unrecognized
deferred  loan  costs,  approximately  $2,749,000  of  prepayment  premiums  and
contingent payments,  and $375,000 of unamortized debt discount,  related to the
existing debt.

                                      F-19



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(NOTE H) - PROGRAM BROADCAST RIGHTS PAYABLE

(1) Program broadcast rights and program broadcast rights payable consist of the
    following:

<TABLE>
<CAPTION>
                                                                     Program                  Program
                                                                    Broadcast                Broadcast
                                                                     Rights               Rights Payable
                                                               ------------------      --------------------
<S>                                                             <C>                        <C>
Balance at December 31, 1994..................................      $   1,772,548          $      2,169,461
     Contracts Acquired.......................................          2,651,642                 2,637,616
     Amortization.............................................        (2,161,545)                         -
     Payments.................................................                  -                (2,131,990)
                                                               ------------------      --------------------
Balance at December 31, 1995..................................      $   2,262,645          $      2,675,087
     Contracts Acquired.......................................          8,862,457                 8,354,793
     Amortization.............................................        (4,398,905)                        -
     Payments.................................................                  -                (3,317,527)
                                                               ------------------      --------------------
Balance at December 31, 1996..................................      $   6,726,197          $      7,712,353
                                                               ==================      ====================
</TABLE>

(2) The current maturities of program broadcast rights payable  consist  of  the
    following:

<TABLE>
<CAPTION>
                                                                             December 31,
                                                               ----------------------------------------
                                                                         1995             1996
                                                                         ----             ----
<S>                                                                 <C>               <C>
Program contracts, due in varying installments
  through 2000................................................      $  2,675,087    $  7,712,353
Less current maturities.......................................         2,042,643       6,119,953
                                                               -----------------    ------------
Long-term portion.............................................     $     632,444    $  1,592,400
                                                               =================    ============
</TABLE>


                                      F-20



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

   The maturities of the contracts are as follows:

     Year Ending December 31,
   ----------------------------
               1997................      $ 6,119,953
               1998................        1,252,005
               1999................          318,514
               2000................           21,881
                                    ----------------
                                         $ 7,712,353
                                    ================

     In addition,  the Company has entered into  noncancellable  commitments for
future  program  broadcast  rights  aggregating  approximately  $6,616,000 as of
December 31, 1996 with future payments as follows:

     Year Ending December 31,
   -----------------------------
               1997................      $ 1,027,131
               1998................        2,846,417
               1999................        2,100,006
               2000................          642,446
                                    ----------------
                                         $ 6,616,000
                                    ================

(NOTE I) - ACCOUNTS PAYABLE AND ACCRUED EXPENSES

   Accounts payable and accrued expenses consist of the following:

                                            December 31,
                               ---------------------------------------
                                      1995                  1996
                                      ----                  ----
Trade payables..............     $    379,901            $ 1,364,482
Barter, net.................          292,051                443,012
Compensation and benefits...        1,397,796              4,329,000
Interest....................        5,343,754              7,239,896
Other.......................          410,794              1,992,191
                             ----------------      -----------------
                                  $ 7,824,296            $15,368,581
                             ================      =================
(NOTE J) - LEASES

     The  Company  leases  land,  office  space and  office  and  transportation
equipment  under  agreements  which  expire from 1997  through  2004 and require
various  minimum annual  rentals.  The leases also require payment of the normal
maintenance,  real estate taxes and insurance on the properties. The Company has
the option to acquire one of the leased premises on each of May 1, 2000 and 2005
for $650,000 and $750,000, respectively.

                                      F-21



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The approximate total minimum rental commitments at December 31, 1996 under
these leases are due as follows:

     Year Ending December 31,
   --------------------------------
               1997................     $    903,419
               1998................          593,829
               1999................          462,577
               2000................          386,983
               2001................          300,628
            Thereafter.............          651,554
                                    ----------------
                                         $ 3,298,990
                                    ================

     Total rental expense under these  agreements and other monthly  rentals for
the years ended 1994,  1995 and 1996 was  approximately  $463,000,  $626,000 and
$1,064,000, respectively.

     The Company is a lessor of certain portions of its real property to various
organizations.  Total rental income under these  agreements  for the years ended
1994,  1995  and  1996  was  approximately  $280,000,   $324,000  and  $680,000,
respectively.

(NOTE K) - INCOME TAX MATTERS AND CHANGE IN TAX STATUS

     Prior to the consummation of the  acquisitions  and the related  financing,
Benedek Broadcasting,  with the consent of its stockholder,  elected to be taxed
under sections of federal and state income tax law, which provided that, in lieu
of corporation  income taxes, the stockholder  separately  accounted for Benedek
Broadcasting's income,  deductions,  losses and credits. Due to the structure of
the  financing  for  the  acquisitions,  the  election  to be  taxed  as an  "S"
Corporation  automatically terminated and Benedek Broadcasting became subject to
federal and state income taxes. As a result,  Benedek Broadcasting  recognized a
net deferred tax asset of approximately  $3,550,000.  Concurrent with the change
in tax status the accumulated  deficit of $41,072,877 which existed on that date
was reclassified to additional paid-in capital.

                                      F-22



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The  deferred  tax assets and  liabilities,  resulting  primarily  from the
acquisitions explained in (Note B) consist of the following components:

                                         December 31,
                                             1996
                                             ----
Deferred tax assets:
   Loss Carryforwards...............          $ 3,769,000
   Receivable allowances
      and accruals..................            1,050,000
   Network agreements...............            2,057,000
   Original issue discount..........            2,722,000
                                     --------------------
                                                9,598,000
                                     --------------------
Deferred tax liabilities:
   Property and equipment...........           14,307,000
   Intangibles......................           48,558,000
                                     --------------------
                                               62,865,000
                                     --------------------
Net deferred tax liability..........      $  (53,267,000)
                                     ====================

     Had the Company been a taxable entity at December 31, 1995, they would have
recorded a net deferred tax asset of  approximately  $3,565,000 which would have
been offset by a valuation allowance.

     The income tax  benefit  for 1996  consisted  of a deferred  tax benefit of
approximately $4,759,000 and $(95,000) of current taxes.

     Under  the  provisions  of the  Internal  Revenue  Code,  the  Company  has
approximately $9,422,000 of actual net operating loss carryforwards available to
offset future tax liabilities of the Company, which expire in 2007 through 2011.

                                      F-23



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     A reconciliation  of the statutory federal income tax rate to the Company's
effective tax rate is as follows:

<TABLE>
<CAPTION>
                                                       Years ended December 31,
                                              -----------------------------------------
                                                   1994         1995           1996
                                                   ----         ----           ----
<S>                                                <C>          <C>           <C>
Computed "expected" income tax
 expense (benefit)..........................       35.0%       (35.0)%        (35.0)%
   Increase (decrease) resulting from:
   State income taxes, net of federal
     effect.................................         -            -            (6.0)
   (Income) loss allocated to
     stockholder due to "S"
     Corporation status.....................      (50.4)        (36.2)          5.2
   Nondeductible amortization and
     expenses...............................       15.4          71.2           7.1
   Other, net...............................         -            -             0.8
                                              -----------     ---------    ----------
Effective tax rate..........................         -            -           (29.5)%
                                              ===========     =========    ==========
</TABLE>

(NOTE L) - PREFERRED STOCK

     The Board of Directors of the Company has  authorized  2,500,000  shares of
preferred stock of which 1,050,000 was issued in conjunction  with the financing
discussed  in Note F. The Board has the right and  ability  to set the terms and
preferences  of the  preferred  stock.  The  Board  has not set  the  terms  and
preferences of the remaining 1,450,000 unissued shares.

(NOTE M) - FAIR VALUE OF FINANCIAL INSTRUMENTS

     The estimated fair value of financial instruments has been estimated by the
Company  using  available   market   information   and   appropriate   valuation
methodologies as discussed below.  Considerable judgment was required,  however,
to interpret  market data to develop the  estimates of fair value.  Accordingly,
the estimates presented below are not necessarily  indicative of the amounts the
Company could realize in a current market exchange.

     Cash and cash equivalents,  current  receivables,  current payables and the
interest rate cap agreement have carrying  values which  approximate  fair value
because  of the  short-term  nature  of those  instruments.  The  floating  rate
long-term debt carrying amount approximates fair value because the interest rate
fluctuates with the bank's lending rate.

                                      F-24



<PAGE>


               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The following table shows the carrying amounts and estimated fair values of
other financial instrument liabilities and other off-balance sheet activities at
December 31, 1995 and 1996:

<TABLE>
<CAPTION>
                                                        1995                                           1996
                                       ---------------------------------------       ----------------------------------------
                                           Carrying               Estimated              Carrying               Estimated
                                            Amount               Fair Value               Amount               Fair Value
                                       -----------------      ----------------       -----------------      -----------------
 <S>                                        <C>                   <C>                     <C>                    <C>
Program broadcast rights
  payable.............................      $  2,675,087          $  2,599,361           $   7,712,353           $  7,552,460
Senior subordinated discount
  notes...............................                 -                     -              97,047,714             97,750,000
Senior secured notes..................       135,000,000           143,100,000             135,000,000            138,375,000
Seller junior discount preferred
 stock................................                 -                     -              47,057,040             31,710,700
Initial warrants......................                 -                     -               7,826,441              2,800,000
</TABLE>

     The fair value of program  broadcast rights payable was estimated using the
discounted cash flow method.

     The fair value of the Senior Subordinated Discount Notes and Senior Secured
Notes was estimated determined using readily available quoted market prices.

     The fair  value  of the  Exchangeable  Redeemable  Senior  Preferred  Stock
approximates  carrying value based upon  discounting the contractual  cash flows
including the redemption  prepayment premium related to the optional  redemption
right that the Company  intends to exercise,  using  estimated  market  discount
rates  which  reflect  the  interest  rate  and  other  risks  inherent  in  the
instrument.

     The fair value of the Seller Junior  Discount  Preferred Stock is estimated
using discounted cash flow analyses, based on the interest rate, preferences and
other risks inherent in the instrument.

     The  fair  value  of the  Initial  Warrants  was  estimated  as 7.5% of the
multiple of the Broadcast cash flow less interest  bearing debt.  Broadcast cash
flow is defined as  operating  income  before  financial  income as derived from
consolidated  statements of operations  plus  depreciation  and  amortization of
broadcast rights,  corporate expenses and noncash compensation less payments for
broadcast rights.

     The fair value of the contingent  warrants was not estimated  because it is
management's  intention to redeem the Exchangeable  Redeemable  Senior Preferred
Stock prior to any release of the Contingent Warrants from escrow.

     The above fair value  estimates were made at a discrete point in time based
on  relevant  market  information  and other  assumptions  about  the  financial
instruments.  As no  active  market  exists  for a  significant  portion  of the
Company's  financial  instruments,  fair value estimates were based on judgments
regarding  current  economic  conditions,   future  expected  cash  flows,  risk
characteristics and other factors.  These estimates are subjective in nature and
involve uncertainties and therefore cannot be calculated with precision. Changes
in assumptions could significantly affect these estimates.

                                      F-25



<PAGE>



                          INDEPENDENT AUDITOR'S REPORT

To the Board of Directors

Benedek Communications Corporation and Subsidiaries
Rockford, Illinois

     Our  audits  were made for the  purpose  of forming an opinion on the basic
consolidated   financial   statements   taken  as  a  whole.   The  consolidated
supplemental schedule is presented for purposes of complying with the Securities
and  Exchange  Commission's  rules and are not a part of the basic  consolidated
financial  statements.  These  schedules  have been  subjected  to the  auditing
procedures applied in our audits of the basic consolidated  financial statements
and, in our opinion,  are fairly stated in all material  respects in relation to
the basic consolidated financial statements taken as a whole.

                                                     /s/ McGLADREY & PULLEN, LLP

Rockford, Illinois
February 28, 1997

                                       S-1



<PAGE>



               BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
<TABLE>
<CAPTION>
                                                                                         ADDITIONS
                                               BALANCE AT         BALANCES        CHARGED TO                           BALANCE AT
                                                BEGINNING       ACQUIRED IN       COSTS AND         DEDUCTIONS           END OF
                                                OF PERIOD       ACQUISITIONS       EXPENSES         DESCRIBED (1)        PERIOD
                                             --------------    --------------   -------------     ---------------    --------------
<S>                                            <C>             <C>               <C>                <C>              <C>
Deducted from asset account --
allowance for doubtful accounts:
   Year ended December 31, 1994............    $   91,778      $        -        $   130,622       $   122,132       $  100,268
   Year ended December 31, 1995............       100,268               -            201,382            52,627          249,023
   Year ended December 31, 1996............       249,023          86,458            403,843           255,804          483,519
</TABLE>

---------------------------
(1)  Uncollectible accounts written off, net of recoveries

                                       S-2



<PAGE>


                                   EXHIBIT INDEX

<TABLE>
<CAPTION>
                                                                                     LOCATION OF
                                                                                       EXHIBIT
                                                                                    IN SEQUENTIAL
EXHIBIT                                                                                NUMBERING
  NO.                                 DESCRIPTION                                       SYSTEM
  --                                  -----------                                       -------
 <S>          <C>                                                                        <C>
    3.1 -- Certificate  of   Incorporation   of  the  Registrant,   as  amended,
           incorporated  by  reference  to  Exhibit  3.1  to  the   Registrant's
           Registration  Statement  on Form S-4,  File No.  333-09529,  filed on
           August 2, 1996 (the "S-4 Registration Statement").

    3.2 -- By-Laws of the  Registrant,  incorporated by reference to Exhibit 3.2
           to the S-4 Registration Statement.

    3.3 -- Certificate of Designation of the Powers,  Preferences  and Relative,
           Participating,   Optional   and   Other   Special   Rights  of  15.0%
           Exchangeable   Redeemable   Senior   Preferred  Stock  Due  2007  and
           Qualifications, Limitations and Restrictions thereof, incorporated by
           reference to Exhibit 3.3 to the S-4 Registration Statement.

    3.4 -- Certificate of Designation,  Preferences and Relative, Participating,
           Optional  and  Other  Special  Rights  of  Series C  Junior  Discount
           Preferred  Stock and  Qualifications,  Limitations  and  Restrictions
           thereof,  incorporated  by  reference  to  Exhibit  3.4  to  the  S-4
           Registration Statement.

    4.1 -- Indenture  dated as of May 15, 1996 between the Registrant and United
           States  Trust  Company of New York,  relating to the  13-1/4%  Senior
           Subordinated  Discount Notes due 2006,  incorporated  by reference to
           Exhibit 4.1 to the S-4 Registration Statement.

    4.2 -- Form of 13-1/4% Senior Subordinated  Discount Note due 2006 (included
           in Exhibit 4.1 hereof),  incorporated  by reference to Exhibit 4.2 to
           the S-4 Registration Statement.

    4.3 -- Indenture  dated as of March 1,  1995  between  Benedek  Broadcasting
           Corporation  ("Benedek  Broadcasting")  and  The  Bank  of New  York,
           relating  to the  11-7/8%  Senior  Secured  Notes due 2005 of Benedek
           Broadcasting,  incorporated  by  reference  to Exhibit 4.3 to the S-4
           Registration Statement.

    4.4 -- Form of 11-7/8% Senior Secured Note due 2005 of Benedek  Broadcasting
           (included  in Exhibit  4.3  hereof),  incorporated  by  reference  to
           Exhibit 4.4 to the S-4 Registration Statement.

    4.5 -- Certificate of Designation of the Powers,  Preferences  and Relative,
           Participating,   Optional   and   Other   Special   Rights  of  15.0%
           Exchangeable   Redeemable   Senior   Preferred  Stock  due  2007  and
           Qualifications,   Limitations  and  Restrictions  thereof  (filed  as
           Exhibit 3.3 hereof),  incorporated by reference to Exhibit 4.5 to the
           S-4 Registration Statement.

    4.6 -- Certificate of Designation,  Preferences and Relative, Participating,
           Optional  and  Other  Special  Rights  of  Series C  Junior  Discount
           Preferred  Stock and  Qualifications,  Limitations  and  Restrictions
           thereof (filed as Exhibit 3.4 hereof),  incorporated  by reference to
           Exhibit 4.6 to the S-4 Registration Statement.

    4.7 -- Warrant Agreement dated as of June 5, 1996 between the Registrant and
           IBJ  Schroder  Bank & Trust  Company  with  respect to Class A Common
           Stock of the Registrant,  incorporated by reference to Exhibit 4.7 to
           the S-4 Registration Statement.
</TABLE>



<PAGE>




                                  EXHIBIT INDEX
<TABLE>
<CAPTION>
                                                                                     LOCATION OF
                                                                                       EXHIBIT
                                                                                    IN SEQUENTIAL
EXHIBIT                                                                                NUMBERING
  NO.                                 DESCRIPTION                                       SYSTEM
  --                                  -----------                                       -------
 <S>          <C>                                                                        <C>
  10.1  -- Purchase  Agreement  dated May 30, 1996  between the  Registrant  and
           Goldman,  Sachs & Co.,  incorporated  by reference to Exhibit 10.1 to
           the S-4 Registration Statement.

  10.2  -- Exchange and Registration Rights Agreement dated May 30, 1996 between
           the Registrant  and Goldman,  Sachs & Co. with respect to the 13-1/4%
           Senior  Subordinated  Discount  Notes  due  2006  of the  Registrant,
           incorporated  by reference  to Exhibit  10.2 to the S-4  Registration
           Statement.

  10.3  -- Placement Agreement dated June 5, 1996 among the Registrant, Goldman,
           Sachs & Co. and BT Securities Corporation,  incorporated by reference
           to Exhibit 10.3 to the S-4 Registration Statement.

  10.4  -- Exchange and  Registration  Rights Agreement dated June 5, 1996 among
           the Registrant,  Goldman,  Sachs & Co. and BT Securities  Corporation
           with respect to the 15.0%  Exchangeable  Redeemable  Senior Preferred
           Stock  due  2007 of the  Registrant,  incorporated  by  reference  to
           Exhibit 10.4 to the S-4 Registration Statement.

  10.5  -- Warrant Agreement dated as of June 5, 1996 between the Registrant and
           IBJ  Schroder  Bank & Trust  Company  (filed as Exhibit 4.7  hereof),
           incorporated  by reference  to Exhibit  10.5 to the S-4  Registration
           Statement.

  10.6  -- Contingent  Warrant Escrow  Agreement  dated June 5, 1996 between the
           Registrant  and IBJ Schroder Bank & Trust  Company,  incorporated  by
           reference to Exhibit 10.6 to the S-4 Registration Statement.

  10.7  -- Common Stock  Registration  Rights Agreement dated as of June 5, 1996
           among  the  Registrant,  Goldman,  Sachs  &  Co.  and  BT  Securities
           Corporation,  incorporated  by  reference  to Exhibit 10.7 to the S-4
           Registration Statement.

  10.8  -- Credit  Agreement  dated as of June 6,  1996  among  the  Registrant,
           Benedek Broadcasting,  the Lenders listed therein, Pearl Street L.P.,
           Goldman, Sachs & Co. and Canadian Imperial Bank of Commerce, New York
           Agency,  incorporated  by  reference  to  Exhibit  10.8  to  the  S-4
           Registration Statement.

  10.9  -- Guaranty  dated  as of June 6,  1996 by the  Registrant  in  favor of
           Canadian Imperial Bank of Commerce, New York Agency,  incorporated by
           reference to Exhibit 10.9 to the S-4 Registration Statement.

  10.10 -- Pledge  Agreement dated as of June 6, 1996 between the Registrant and
           Canadian Imperial Bank of Commerce, New York Agency,  incorporated by
           reference to Exhibit 10.10 to the S-4 Registration Statement.

  10.11 -- Security  Agreement  dated as of June 6, 1996 between the  Registrant
           and Canadian Imperial Bank of Commence, New York Agency, incorporated
           by reference to Exhibit 10.11 to the S-4 Registration Statement.

  10.12 -- Collateral  Account  Agreement  dated as of June 6, 1996  between the
           Registrant and Canadian  Imperial Bank of Commerce,  New York Agency,
           incorporated  by reference to Exhibit  10.12 to the S-4  Registration
           Statement.

  10.13 -- Third  Party  Account  Agreement  dated as of June 6, 1996  among the
           Registrant, AMCORE Bank, N.A., Rockford and Canadian Imperial Bank of
           Commerce,
</TABLE>



<PAGE>


                                  EXHIBIT INDEX
<TABLE>
<CAPTION>
                                                                                     LOCATION OF
                                                                                       EXHIBIT
                                                                                    IN SEQUENTIAL
EXHIBIT                                                                                NUMBERING
  NO.                                 DESCRIPTION                                       SYSTEM
  --                                  -----------                                       -------
 <S>          <C>                                                                        <C>
           New York Agency,  incorporated  by reference to Exhibit  10.13 to the
           S-4 Registration Statement.

  10.14 -- Form of Indemnity  Agreement  between the  Registrant and each of its
           executive  officers  and  directors,  incorporated  by  reference  to
           Exhibit 10.14 to the S-4 Registration Statement.

 *10.15 -- Option  Agreement dated as of June 6, 1996 between the Registrant and
           K. James Yager.

  10.16 -- Employment  Agreement dated as of June 6, 1996 between the Registrant
           and A. Richard  Benedek,  incorporated by reference to  Exhibit 10.16
           to the S-4 Registration Statement.

  10.17 -- Agreement  dated as of June 6, 1996  between  the  Registrant  and K.
           James Yager,  incorporated  by reference to Exhibit  10.17 to the S-4
           Registration Statement.

  10.18 -- Employment  Agreement dated as of June 6, 1996 between the Registrant
           and Ronald L. Lindwall, incorporated by reference to Exhibit 10.19 to
           the S-4 Registration Statement.

  10.19 -- Employment  Agreement dated as of June 6, 1996 between the Registrant
           and Terrance F. Hurley, incorporated by reference to Exhibit 10.20 to
           the S-4 Registration Statement.

  10.20 -- Limited Waiver and First  Amendment to Credit  Agreement  dated as of
           October  31,  1996   among   the  Registrant,   Benedek  Broadcasting
           Corporation,  Goldman Sachs Credit  Partners L.P., the lenders listed
           therein and Canadian  Imperial Bank of Commerce,  New York Agency, as
           Administrative  Agent,  incorporated by reference to Exhibit 10.21 to
           the Registrant's  Quarterly Report on Form 10-Q for the quarter ended
           September 30, 1996.

 *10.21 -- Limited Waiver and Second  Amendment to Credit  Agreement dated as of
           February  28,   1997  among  the   Registrant,  Benedek  Broadcasting
           Corporation,  Goldman Sachs Credit  Partners L.P., the lenders listed
           therein and Canadian  Imperial Bank of Commerce,  New York Agency, as
           Administrative Agent.

 *21    -- Subsidiaries of the Company.

 *23    -- Consent of McGladrey & Pullen, LLP with respect to the Company.

 *27    -- Financial Data Schedule pursuant to Article 5 of Regulation S-X.





</TABLE>