<PAGE>


-------------------------------------------------------------------------------
                         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, 1999
                         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 NUMBER)
                                   --------------
              100 PARK AVENUE
             ROCKFORD, ILLINOIS                               61101
  (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                  (ZIP CODE)

       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 _____

     100% of the voting common stock of Benedek Communications Corporation is
owned by affiliates.

     Indicate the number of shares outstanding of each of Benedek Communications
Corporation's classes of common stock, as of the latest practicable date: At
March 29, 2000, there were outstanding 7,400,000 shares of Class B common stock,
$0.01 par value, and no shares of Class A common stock, $0.01 par value.

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





<PAGE>


                           BENEDEK COMMUNICATIONS CORPORATION

                                 INDEX TO FORM 10-K

<TABLE>
<CAPTION>
     ITEM
    NUMBER                                                                                                  PAGE
    ------                                                                                                  ----
                                                            PART I

<S>                <C> <C>                                                                                  <C>
     Item          1.  Business........................................................................       1
     Item          2.  Properties......................................................................      17
     Item          3.  Legal Proceedings...............................................................      19
     Item          4.  Submission of Matters to a Vote of Security Holders.............................      19

                                                           PART II

     Item          5.  Market for Registrant's Common Equity and Related Stockholder Matters...........      20
     Item          6.  Selected Consolidated Financial Data............................................      20
     Item          7.  Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
                       Operations......................................................................      22
     Item         7A.  Quantitative and Qualitative Disclosures About Market Risk......................      31
     Item          8.  Financial Statements and Supplementary Data.....................................      31
     Item          9.  Changes in and Disagreements with Accountants on Accounting
                       and Financial Disclosure........................................................      31

                                                           PART III

     Item         10.  Directors and Executive Officers of the Company.................................      32
     Item         11.  Executive Compensation..........................................................      34
     Item         12.  Security Ownership of Certain Beneficial Owners and Management..................      37
     Item         13.  Certain Relationships and Related Transactions..................................      37

                                                           PART IV

     Item         14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K.................      39
Signatures............................................................................................       43
</TABLE>






<PAGE>

                                       PART I

ITEM 1.  BUSINESS.

     This Annual Report on Form 10-K contains forward-looking statements that
involve risks and uncertainties. Wherever possible, Benedek Communications
Corporation (the "Company") has identified these forward looking statements by
words such as "anticipates," "believes," "estimates," "expects" and similar
expressions. 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, pricing fluctuations in local and national advertising, program
ratings and changes in programming costs, among other factors. The Company
assumes no obligation to update publicly any forward looking statements, whether
as a result of new information, future events or otherwise. Discussions
containing such forward looking statements may be found in the materials set
forth under "Item 1. Business," "Item 3. Legal Proceedings" and "Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations" contained herein.

     Except as otherwise provided, the financial data set forth below is derived
from the historical consolidated financial statements of the Company, prepared
in accordance with generally accepted accounting principles. The Company is a
holding company with minimal separate operations from its operating subsidiary,
Benedek Broadcasting Corporation ("Benedek Broadcasting"). Such historical
financial data includes the results of operations of KKTV which was operated
under a time brokerage agreement (a "TBA") with the Ackerley Group, Inc. from
January 1, 1999 until the Company's acquisition of KKTV on May 1, 1999, net of
the fees associated with such TBA. The historical financial data also includes
the limited operating results and TBA fee revenue of KCOY-TV which was being
operated by the Ackerley Group, Inc. under a TBA from January 1, 1999 until the
Ackerley Group, Inc's acquisition of KCOY-TV on May 1, 1999. KCOY-TV was
exchanged for KKTV in a transaction which closed on May 1, 1999.

     As used herein, "Same Station" data refers to the historical results of
operations of all 23 television stations currently operated by the Company as if
such stations were owned by the Company throughout the periods indicated with
pro forma adjustments only for depreciation and amortization and TBA fees and
revenue. Same Station information excludes the results of Benedek Cable, Inc., a
nonrecourse subsidiary. Same Station information does not purport to represent
what the Company's results of operations would have been if such transactions
had been effected at the beginning of such periods and does not purport to
project results of operations of the Company in any future period.

     Broadcast cash flow is defined as operating income, excluding net income of
nonrecourse subsidiaries, before financial income as derived from the
consolidated statements of operations plus depreciation and amortization,
amortization of program broadcast rights, corporate expenses and noncash
compensation less payments for program broadcast liabilities and net gain on
sale of stations. The Company has included broadcast cash flow data because (i)
the information is a measurement utilized by lenders to measure the Company's
ability to service its debt and pay for capital expenditures, (ii) the
information is a measurement utilized by industry analysts to determine a market
value of the Company's television stations and (iii) the information is a
measurement industry analysts utilize when evaluating and comparing the
operating performance of the Company. 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. Broadcast cash flow is also not
reflected in the Company's consolidated statements of cash flows; but it is a
common and meaningful

                                     - 1 -




<PAGE>


measure for comparison to other companies in the broadcast industry. The amounts
excluded from broadcast cash flow are significant components in understanding
and assessing the Company's results of operations and cash flows. The term
"broadcast cash flow" may not be the same terminology utilized by other
companies in the presentation of similar information.

     Adjusted EBITDA is defined as operating income, excluding net income of
nonrecourse subsidiaries, 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 liabilities and net gain on sale of stations. The Company
has included Adjusted EBITDA data because (i) the information is a measurement
utilized by lenders to measure the Company's ability to service its debt and pay
for capital expenditures, (ii) the information is a measurement utilized by
industry analysts to determine a private market value of the Company's
television stations and (iii) the information is a measurement industry analysts
utilize when evaluating and comparing the operating performance of the Company.
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. Adjusted EBITDA is also not reflected in the Company's
consolidated statements of cash flows; but it is a common and meaningful measure
for comparison to other companies in the broadcast industry. The amounts
excluded from Adjusted EBITDA are significant components in understanding and
assessing the Company's results of operations and cash flows. The term "Adjusted
EBITDA" may not be the same terminology utilized by other companies in the
presentation of similar information.

     The Company believes that Adjusted EBITDA and broadcast cash flow
information discussed below provide meaningful information as to the performance
of the television stations owned by the Company, particularly information that
is presented on a Same Station basis. Changes from year to year indicate how the
Company has performed in its efforts to increase net sales and manage expenses
on an operating basis.

GENERAL

     The Company owns 23 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, four are affiliated with NBC, and one is affiliated
with Fox.

     The Stations are located in markets ranked in size from 85 to 199 out of
the 210 markets surveyed by A. C. Nielsen Company ("Nielsen"). The Company's
broadcast signals reach approximately 3.4 million households, representing more
than 3.4% of all television households in the United States and more than 20.0%
of all television households in the markets above 100. 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. The Company
believes that network affiliations with one of the four established networks
provide each of its Stations an established audience and reputation for national
news, sports and entertainment programming. With the established audiences
provided by network affiliations, management seeks to enhance the ratings of its
local news and non-network programming and increase revenues while maintaining
strict cost control.

                                     - 2 -






<PAGE>


     On December 30, 1998, the Company entered into an Asset Exchange Agreement
with the Ackerley Group, Inc. ("Ackerley") pursuant to which it agreed to
exchange the television broadcast assets of KCOY-TV, Santa Maria, California
owned by the Company for the television broadcast assets of KKTV, Colorado
Springs-Pueblo, Colorado owned by Ackerley. Both KCOY-TV and KKTV are CBS
affiliates. The exchange was completed on May 1, 1999 at which time the Company
paid $9.0 million to Ackerley as further consideration in accordance with the
agreement. The transaction was structured, to the extent feasible, as a tax-free
exchange pursuant to Section 1031 of the Internal Revenue Code. The exchange was
recorded as a separate sale and acquisition, with the acquisition of KKTV
recorded under the purchase method of accounting. The total purchase price for
KKTV was $33.6 million which consisted of the fair market value of KCOY-TV of
$24.3 million, cash payment of $9.0 million, and fees of $0.3 million. The
purchase price was allocated to fixed assets in the amount of $6.2 million and
intangibles in the amount of $27.4 million. A gain in the amount of $13.3
million was recorded to reflect the sale of KCOY-TV which consisted of the fair
market value of the KCOY-TV assets of $24.3 million less their book value of
$10.8 million and fees associated with the transaction. In addition, the parties
entered into a time brokerage agreement for each station, in effect from January
1, 1999 through April 30, 1999. During the time brokerage period, the revenues
and expenses of each station went to the account of the acquirer of such
station, net of applicable time brokerage fees. The net time brokerage fee
expense was $0.5 million for the year ended 1999.

     During September 1999, a loss in the amount of approximately $0.2 million
was recorded to reflect the sale of KTVS-TV, Sterling, Colorado which was a
satellite operation of KGWN-TV, the Company's station in Cheyenne, Wyoming. The
Company sold KTVS-TV to UPN. KTVS-TV is part of the Denver market.

     During October 1998, the Company transferred WMTV-TV, the Company's station
in Madison, Wisconsin to a trust (the "WMTV Trust") due to the Grade A broadcast
signal overlap between WMTV-TV and WIFR-TV, the Company's station in Rockford,
Illinois. Under the trust arrangement, the Company relinquished control of
WMTV-TV to a trustee while retaining the economic risks and benefits of
ownership. On August 5, 1999, the Federal Communications Commission (the "FCC")
approved new duopoly rules which enabled the Company to own both WMTV-TV and
WIFR-TV, and as a result the WMTV Trust was dissolved on February 29, 2000 and
all assets and liabilities were transferred to Benedek Broadcasting.

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. Management's primary operating strategy is to maximize each
Station's advertising revenue through the production of 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 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.

                                     - 3 -






<PAGE>


     Management of 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. 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 are "Wheel of Fortune," "Jeopardy," "Judge Judy" and "The Oprah Winfrey
Show." The Company broadcasts "Wheel of Fortune" on 15 of the Stations,
"Jeopardy" on 11 of the Stations, "Judge Judy" on six of the stations, and "The
Oprah Winfrey Show" on nine of the Stations. Additionally, the Company
broadcasts other highly-rated first run syndicated programs on several of the
Stations including "Live with Regis & Kathie Lee," "The Rosie O'Donnell Show"
and "Hollywood Squares." A number of the Stations also broadcast other
highly-rated off-network syndicated programs including "Home Improvement,"
"Frasier," "Mad About You" and "Seinfeld."

     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 for purchasing syndicated programming in the
small and medium-sized markets served by the Company, cash program expense as a
percentage of net revenues for the Stations was 4.7%, 4.6% and 5.3% in 1997,
1998 and 1999, respectively, as compared to approximately 7.4% for all
network-affiliated stations in 1998.

     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 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 and better maintain
consistent Adjusted EBITDA.

     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 57.0% of the Company's gross revenues in 1999 were generated from
local and regional advertisers.

     FINANCIAL PLANNING AND CONTROLS. Management emphasizes strict control of
the Company's 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 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.

                                     - 4 -






<PAGE>


     On November 19, 1999, the Company entered into an Asset Purchase Agreement
with The Chronicle Publishing Company ("Chronicle") and on December 10, 1999,
the Company entered into an Asset Exchange Agreement with WGRC, Inc. ("WGRC").
Pursuant to these agreements, WGRC will acquire the television broadcast assets
of WOWT-TV and KAKE-TV, Chronicle's television stations in Omaha, Nebraska and
Wichita, Kansas, respectively, and then immediately transfer the same to the
Company in exchange for the television broadcast assets of WWLP-TV, the
Company's station in Springfield, Massachusetts. The proposed transaction will
include an $18.0 million payment by the Company to WGRC. At December 31, 1999,
the Company had deposited $10.0 million in an escrow account related to this
transaction. The remaining $8.0 million will be funded from the proceeds related
to the sale of KOSA-TV discussed below. The transaction will be structured, to
the extent feasible, as a tax-free exchange pursuant to Section 1031 of the
Internal Revenue Code and recorded under the purchase method of accounting. The
transaction has been approved by the FCC and is expected to close in the first
quarter of 2000.

     On December 15, 1999, the Company entered into an Asset Purchase Agreement
with ICA Broadcasting I, Ltd. ("ICA") pursuant to which the Company would sell
the television broadcast assets of KOSA-TV, in Odessa, Texas to ICA for a cash
payment of $8.0 million. Accordingly, the Company recorded a lower of cost or
market adjustment of approximately $6.9 million in 1999 to write down the assets
of KOSA-TV to the sales price less estimated selling costs. This transaction was
completed on March 21, 2000.

BACKGROUND OF THE COMPANY

     The Company was incorporated under the laws of the State of Delaware on
April 10, 1996. Benedek Broadcasting was incorporated under the laws of the
State of Delaware on January 22, 1979. The principal executive offices of the
Company are located at 100 Park Avenue, Rockford, Illinois 61101. The telephone
number at the executive offices is (815) 987-5350.

                                     - 5 -




<PAGE>


THE STATIONS

     The following table sets forth certain information for each of the Stations
and the markets they serve.

<TABLE>
<CAPTION>
                                                                                             NUMBER OF
                                                                                            COMMERCIAL
                                                                                             BROADCAST    STATION
                                             MARKET      CALL                   NETWORK     STATIONS IN   RANK IN        CABLE
               MARKET AREA                  RANK (a)    LETTERS   CHANNEL (b)  AFFILIATION  MARKET (a)   MARKET (c)  PENETRATION (a)
               -----------                  --------    -------   -----------  -----------  ----------   ----------  ---------------

<S>                                            <C>      <C>           <C>         <C>            <C>         <C>          <C>
Madison, Wisconsin                             85       WMTV-TV       15          NBC            4           1            63%

Colorado Springs-Pueblo, Colorado              93       KKTV-TV       11          CBS            4           1            68%

Youngstown, Ohio                               99       WYTV-TV       33          ABC            4           3            74%

Springfield and Holyoke, Massachusetts (d)     104      WWLP-TV       22          NBC            2           1            83%

Lansing, Michigan                              107      WILX-TV       10          NBC            4           2            68%

Peoria and Bloomington, Illinois               110      WHOI-TV       19          ABC            4           3            72%

Duluth, Minnesota and Superior, Wisconsin      133      KDLH-TV        3          CBS            4           3            52%

Rockford, Illinois                             135      WIFR-TV       23          CBS            4           1            70%

Wausau and Rhinelander, Wisconsin              136      WSAW-TV        7          CBS            3           1            56%

Topeka, Kansas                                 138      WIBW-TV       13          CBS            4           1            71%

Wheeling, West Virginia and                    140      WTRF-TV        7          CBS            2           2            78%
Steubenville, Ohio

Wichita Falls, Texas and Lawton, Oklahoma      143      KAUZ-TV        6          CBS            5           2            68%

Columbia and Jefferson City, Missouri          145      KMIZ-TV       17          ABC            5           3            60%
                                               145       KO2NQ         2          FOX          5(e)         4(e)          60%
                                               145       K11TB        11          FOX          5(e)         4(e)          60%

Odessa and Midland, Texas (f)                  150      KOSA-TV        7          CBS            4           2            73%

Quincy, Illinois, Hannibal, Missouri
and Keokuk, Iowa                               161      KHQA-TV        7          CBS            2           1            62%

Dothan, Alabama                                172      WTVY-TV        4          CBS            3           1            70%
Panama City, Florida                           157      WTVY-TV        4          CBS            4           3            65%

Harrisonburg, Virginia                         180      WHSV-TV        3          ABC            1           1            74%

Bowling Green, Kentucky                        182      WBKO-TV       13          ABC            2           1            55%

Meridian, Mississippi                          183      WTOK-TV       11          ABC            3           1            54%

Parkersburg, West Virginia                     185      WTAP-TV       15          NBC            1           1            77%

Cheyenne, Wyoming and Scottsbluff,             197      KGWN-TV        5          CBS            3          1(g)         72%(g)
Nebraska                                       197    KSTF-TV(h)      10          CBS           (i)         (g)           (g)

Casper and Riverton, Wyoming                   199      KGWC-TV       14          CBS            4          2(k)         66%(k)
                                               199    KGWL-TV(j)       5          CBS           (i)         (k)           (k)
                                               199    KGWR-TV(j)      13          CBS           (i)         (k)           (k)

------------
(a)  Based on data compiled from the November 1999 Nielsen surveys.

                                     - 6 -






<PAGE>


(b)  Channels 2 through 13 are broadcast over the very high frequency band of
     the broadcast spectrum and channels 14 through 69 are broadcast over the
     ultra high frequency band of the broadcast spectrum.

(c)  Station Rank in Market is a Station's rank in the market among all
     commercial stations in a Station's market, measured by such Station's
     average rating Sunday through Saturday, 6:00 am to 2:00 am during the
     February 1999, May 1999, July 1999 and November 1999 Nielsen surveys.

(d)  The Company has entered into an agreement to exchange the broadcast assets
     of WWLP-TV for the broadcast assets of KAKE-TV, Wichita, Kansas and
     WOWT-TV, Omaha, Nebraska. See Business-Future Acquisitions and
     Opportunities and Management's Discussion and Analysis of Financial
     Condition and Results of Operations-Recent Developments.

(e)  KO2NQ and K11TB are low-power broadcast television stations operated by
     KMIZ-TV and distributed primarily via cable television. These two Stations
     began operating in September 1997 as a single entity operating from one
     facility and offering an identical programming schedule. Additionally, such
     Stations are treated as one station for purposes of determining the number
     of commercial stations in the market and rank in the market.

(f)  The Company sold the television broadcast assets of KOSA-TV on March 21,
     2000. See Business-Future Acquisitions and Opportunities and Management's
     Discussion and Analysis of Financial Condition and Results of
     Operations-Recent Developments.

(g)  Station Rank, Station Rating and Cable Penetration information for KGWN-TV
     includes data for satellite station KSTF-TV, Scottsbluff, Nebraska.

(h)  Satellite station of KGWN-TV.

(i)  Satellite stations are not considered distinct stations in this market for
     Nielsen purposes.

(j)  Satellite station of KGWC-TV.

(k)  Station Rank, Station Rating 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.

</TABLE>


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 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, in most cases, 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
Brothers Television Network were launched in 1994 as television networks. UPN
and The Warner Brothers Television Network currently supply fewer hours of
network programming than any of the four major networks.

                                     - 7 -




<PAGE>


     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 television systems were first installed in significant numbers in the
late 1960s and early 1970s and were initially used to retransmit broadcast
television programming in areas with poor broadcast signal reception. According
to the 2000 Television & Cable Factbook, cable television currently passes
approximately 91% of all television households nationwide and approximately 72%
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, 54% of all prime time television
viewing time during the 1998-1999 broadcast season, through November 1999, was
spent viewing broadcast television programming on ABC, CBS, NBC, and Fox.

     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. Television 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."

NETWORK AFFILIATION OF THE STATIONS

     Each of the Stations is affiliated with either ABC, CBS, NBC or Fox
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 the case of networks except
for Fox, 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.

     During 1999, each of the major networks publicly indicated that it is
reviewing the economic and other terms under which it provides programming to
network affiliates like the Stations. Proposed changes that have been publicly
discussed include: (i) reducing or eliminating the cash payments paid by
networks to affiliates, (ii) reducing the period of exclusivity with respect to
popular programming, (iii) changing the amount and placement of advertising time
made available for sale by affiliates during network programming and (iv)
requiring affiliates to share part of the costs of producing popular or special
programming. These changes may be implemented during the term of existing
affiliation agreements or upon renewal of the contract. In response to declining
revenues, some networks have suggested that they may search for alternative
methods of distribution for their programming, such as satellite and cable
channels. While management does not anticipate changes in the current contract
periods, certain of these changes could materially adversely affect the
Company's financial condition or results of operations.

                                     - 8 -




<PAGE>


     Each of the Stations' network affiliation agreements currently runs for a
period of two to ten years. WYTV, KIMZ-TV, WBKO-TV, WTOK-TV and WHSV-TV, all of
which are ABC affiliates, each have an affiliation agreement which expires in
2004. WHOI-TV, an ABC affiliate, currently operates under an affiliation
agreement which expires in 2005 and which does not provide for renewals. Each of
KDLH-TV, WIFR-TV, KHQA-TV, WTVY-TV, KGWN-TV, KGWC-TV, WIBW-TV, WSAW-TV, WTRF-TV,
KAUZ-TV and KOSA-TV, all of which are CBS affiliates, has 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. KKTV-TV, a CBS affiliate,
currently operates under an affiliation agreement which expires June 30, 2000
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, which notice was not received for the current term. Therefore,
the term of the KKTV-TV affiliation agreement will run through June 30, 2005.
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 six-year affiliation agreement which
expires in 2005.

     The Company also owns and operates two low-power television stations
located in Columbia and Jefferson City, Missouri under the call letters KO2NQ
and K11TB. These Stations are affiliated under a network affiliation agreement
with Fox that automatically continues until terminated by either party upon 120
days' advance notice. The primary means of distribution for these Stations is
via cable television.

     During September 1998, the Company began delivering The Warner Bros.
Television Network programming to local cable companies in 15 of the Company's
20 markets which rank above market 100 as measured by Nielsen surveys. These
local affiliates are collectively called the "WB" and are operated by Benedek
Cable, Inc. ("BCI"), a wholly-owned subsidiary of Benedek Broadcasting. The WB's
impact on the Company's operations for the years ended December 31, 1999 and
1998 was insignificant. For purposes of calculating the Company's Adjusted
EBITDA, the results of operations of BCI are excluded due to its status as a
nonrecourse subsidiary.

ADVERTISING SALES

     Television station revenues are derived primarily from local, regional and
national advertising and, to a lesser extent, from compensation paid by the
networks for broadcasting network programming and barter transactions for goods
and services. 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 57.0% of the gross revenues of the Stations in
1999 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, 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 frequently shares such information among the
Stations.

                                     - 9 -




<PAGE>


     National Sales. Approximately 30.2% of the gross revenues of the Stations
in 1999 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. Nine of the Stations are represented by Katz Television Sales, 11
Stations are represented by Petry Television, Inc., and three retain Blair
Television. The 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.

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 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 three markets, the Company owns one of three local television
stations. In 10 markets, the Company owns one of four local television stations.
In the Columbia and Jefferson City, Missouri market, the Company owns two of
five stations, one of the owned stations being the jointly operated low-power
station known in the market as Fox-11. In one other market, the Company owns one
of five 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 and DBS, have 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 in small
and medium-sized markets.

     Two major nationwide companies deliver DBS to homes from satellites. In
1999, Congress passed a new law permitting DBS systems to carry local television
stations, which will make DBS more competitive with cable. 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
licensed a 28 GHz and 31 GHz microwave cable service that will have the
potential to provide up to 100 channels of video or more. The FCC has licensed
low power television stations which are television stations with coverage areas
much smaller than those served by full power conventional television stations.

                                     - 10 -




<PAGE>


     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 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 broadcasting. This separate channel may
also be used by broadcasters for data transmission and multi-channel
transmission. The FCC has 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 in 2006, each broadcaster will 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. In late 1998, the FCC
refined its DTV rules and DTV channel assignments. The FCC's DTV decisions now
are subject to judicial review before the U.S. Court of Appeals for the District
of Columbia Circuit. Also in 1998, the FCC issued a decision to implement the
requirement of the Telecommunications Act of 1996 that it charge broadcasters a
fee for offering subscription services on the DTV channel. The FCC's decision to
impose a fee of 5% of the gross revenues generated by such services currently is
subject to petitions for reconsideration before the FCC. The FCC also is
considering whether and how to extend cable systems' obligations for mandatory
carriage of certain broadcast television signals to the DTV channel.
Deliberations on this issue include the question of whether cable systems will
be required to carry both DTV and analog channels broadcast by a television
station that multicasts on its DTV channel, and whether cable systems should be
required to retransmit DTV signals in the same definition in which originally
broadcast. 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.

     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 products (such as "The Oprah Winfrey Show," "Wheel of
Fortune" and "Jeopardy") and for off-network reruns (such as "Home Improvement,"
"Seinfeld" and "Frasier") 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, local cable systems
and internet sites. 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.

                                     - 11 -






<PAGE>


RATING SERVICE DATA

     All television stations in the United States are grouped into 210
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. Each specific market
is called a Designated Market Area ("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.

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 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 petitions to deny are filed against broadcast license renewal
applications. All of the Stations are presently operating under eight-year
licenses expiring on various dates from 1999 to 2006. Currently, WWLP-TV,
Springfield, Massachusetts has a pending application 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 WWLP-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.

                                     - 12 -




<PAGE>


     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. The FCC recently amended its local ownership
rules to permit one company to own two television stations in the same market if
there are at least eight independently owned full-power television stations in
that market (counting the co-owned stations as one) and if at least one of the
co-owned stations is not among the top four ranked television stations in the
same market. The FCC also decided to permit common ownership of stations in a
single market if there signals do not overlap and to permit common ownership of
certain failing or unbuilt stations, and it liberalized its rules on ownership
of stations in neighboring markets. These rule changes are likely to increase
concentration of ownership in medium-size and larger markets. They also will
permit some common ownership in bordering markets that was prohibited under the
prior rule. For example, the Company is now permitted to maintain ownership of
WIFR-TV, Rockford, Illinois, and WMTV-TV in Madison, Wisconsin. Under the prior
rules, the Company would have been required to dispose of one of these stations.
The Company also may have opportunities to acquire additional properties under
this rule. The ultimate effect of this rule on the Company's broadcast
operations cannot be predicted. 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 benchmark 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 majority
stockholder who owns 87.4% of outstanding stock of the Company. In the event the
Company no longer had a single majority stockholder, minority interests would be
deemed to be attributable interests.

     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.

     Qualified 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 time" 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 for a

                                     - 13 -





<PAGE>


spot of the same length and class in the same period. These requirements can
have the effect of reducing the revenues that a station might otherwise earn
during pre-election 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 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 (6
a.m. to 10 p.m.). 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.

     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 continued establishment of DBS, 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 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.

                                     - 14 -




<PAGE>


     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 "content-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. In its March 31, 1997 decision, the Supreme Court, by a 5
to 4 vote, affirmed the judgment of the district court. The Court concluded that
the record supports Congress' judgment that the must-carry provisions serve
significant governmental interests, namely preserving the benefits of free,
over-the-air local broadcast television, promoting the widespread dissemination
of information from a multiplicity of sources and promoting fair competition in
the market for television programming.

     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. Such elections are generally required every three years. By
October 1, 1999, stations were required to make their second election covering
the three-year period from January 1, 2000 to December 31, 2002.

      The Company has entered into agreements for the Stations with
substantially all of the cable system operators which carry the Stations'
signals. All of these agreements grant such cable system operators consent to
retransmit the Stations' signal. These retransmission arrangements do not
represent a significant source of revenue for the Company. 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.

     Implementation of the Satellite Home Viewer Improvement act of 1999. In
November 1999, Congress passed the Satellite Home Viewer Improvement Act, which
provides DBS operators with the ability to retransmit the broadcast signal of
local television stations to subscribers in the station's local market area.
("local-into-local" service), provided that the DBS operator has obtained the
consent of the broadcaster. By January 1, 2002, DBS providers that offer
local-into-local service will be required to carry all full-power television
stations in markets in which they have chosen to provide this service. The Act
also continues restrictions on the transmission of distant network station by
DBS operators. Under these restrictions, DBS operators are effectively
prohibited from distributing the signal of any network affiliated television
station except in areas where the over-the-air signal of the same network's
local affiliate is not available. Several lawsuits were filed beginning in late
1996 in which plaintiffs allege that certain DBS operators have not been
complying with this restriction. The plaintiffs have entered into a settlement
with DBS operator DirecTV, under which it will discontinue distant-network
service to certain subscribers and alter the method by which it determines
eligibility for this service. Litigation against DBS operator Echostar is
ongoing. The Act also provides that certain distant-network subscribers whose
service would have been discontinued by this litigation will continue to have
access to this service for a five-year period. The Act further requires the FCC
to reconsider the computer model by which DBS providers predict eligibility for
distant-signal service and to suggest recommendations to Congress on whether the
technical standard for eligibility should be changed by subsequent legislation.

     The ability of DBS operators to provide local-into-local service is
expected to increase competition between cable and DBS operators in markets
where local-into-local service is provided. DBS operators are not required to
provide local-into-local service, and some smaller markets may not receive this
service for several years. Broadcast stations in smaller markets may face
increasing competition from stations in nearby larger markets, which may be
carried under the Act's local-into-local provisions before stations in smaller
markets are carried. However, legislation is pending before Congress that would
provide loan guarantees to companies intending to offer local-into-local service
in smaller communities,

                                     - 15 -




<PAGE>


and DBS operators have stated that they intend to provide this service to a
greater number of markets in the future. Local-into-local service is not yet
offered in most markets in which the Company operates television stations, but
such services could be launched by DBS operators at any time.

EMPLOYEES

     The Company currently employs 1,247 full-time employees. Approximately 257
of the Company's employees located at WMTV-TV, WILX-TV, WHOI-TV, WTRF-TV,
KDLH-TV and WYTV-TV are represented by labor unions under collective bargaining
agreements. The collective bargaining agreements expire at various times from
2000 through 2003. 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.

                                     - 16 -




<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>
                                                       OWNED       APPROXIMATE                                EXPIRATION
 STATION, MARKET AREA AND USE                         OR LEASED      SIZE (a)                HEIGHT/POWER      OF LEASE
-------------------------------------------------    -----------   -----------              --------------    -----------

<S>                                                   <C>         <C>                     <C>                 <C>
Madison, Wisconsin WMTV-TV
    Office and Studio............................     Owned(b)    16,485 sq. ft. (c)            --               --
    Tower/Transmitter Site.......................     Owned(b)                            1,040 ft./955 kw       --

Colorado Springs and Pueblo, Colorado KKTV-TV
    Office and Studio............................     Owned(b)    30,465 sq. ft.                --               --
    Tower/Transmitter Site.......................      Leased      500 sq. ft.             350 ft./234 kw     2/01/2059

Youngstown, Ohio WYTV-TV
    Office and Studio............................     Owned(b)    18,964 sq. ft. (c)            --               --
    Tower/Transmitter Site.......................     Owned(b)                             642 ft./550 kw        --

 Springfield and Holyoke, Massachusetts WWLP-TV
    Office and Studio............................     Owned(d)    46,000 sq. ft.                --               --
    Tower/Transmitter Site.......................     Owned(b)    20,000 sq. ft.           500 ft./342 kw        --

Lansing, Michigan WILX-TV
    Office and Studio............................     Owned(b)    13,700 sq. ft.                --               --
    Tower/Transmitter Site.......................      Leased     5,000 sq. ft.            994 ft./309 kw    10/18/2003

Peoria and Bloomington, Illinois WHOI-TV
    Office and Studio............................     Owned(b)    16,900 sq. ft. (c)            --               --
    Tower/Transmitter Site.......................     Owned(b)                            640 ft./2,240 kw       --

Duluth, Minnesota and Superior, Wisconsin
 KDLH-TV
    Office and Studio............................     Owned(b)    25,000 sq. ft. (e)            --               --
    Tower/Transmitter Site.......................     Owned(b)    1,040 sq. ft.            811 ft./100 kw        --

Rockford, Illinois WIFR-TV
    Office and Studio............................     Owned(b)    13,500 sq. ft. (c)            --               --
    Tower/Transmitter Site.......................     Owned(b)                             674 ft./562 kw        --

Wausau and Rhinelander, Wisconsin WSAW-TV
    Office and Studio............................    Owned(b)     24,400 sq. ft.                --               --
    Tower/Transmitter Site.......................    Leased (f)       432 sq. ft.          650 ft./316 kw    08/01/2017

Topeka, Kansas WIBW-TV
    Office and Studio............................      Leased       18,774 sq. ft. (g)          --           02/28/2002
    Tower/Transmitter Site.......................      Leased       2,338 sq. ft.         1,249 ft./316 kw   02/14/2062
</TABLE>

                                     - 17 -




<PAGE>


<TABLE>
<CAPTION>
                                                      OWNED       APPROXIMATE                                EXPIRATION
 STATION, MARKET AREA AND USE                       OR LEASED      SIZE (a)                HEIGHT/POWER       OF LEASE
-------------------------------------------------  -----------   -----------              --------------    -----------
<S>                                                 <C>           <C>                     <C>                 <C>
Wheeling, West Virginia and Steubenville,
Ohio WTRF-TV
    Office and Studio............................   Owned(b)     43,872 sq. ft.(h)            --                 --
    Tower/Transmitter Site.......................   Owned(b)      2,000 sq. ft.          741 ft./316 kw          --

Wichita Falls, Texas and Lawton, Oklahoma
KAUZ-TV
    Office and Studio............................   Owned(b)     13,078 sq. ft.(c)            --                 --
    Tower/Transmitter Site.......................   Owned(b)                            1,028 ft./100 kw         --

Columbia and Jefferson City, Missouri KMIZ-TV
    Office and Studio............................   Owned(b)      5,993 sq. ft.               --                 --
    Tower/Transmitter Site.......................   Owned(b)        875 sq. ft.         1,030 ft./1,580 kw       --

Columbia and Jefferson City, Missouri
KO2NQ (low power)
    Tower/Transmitter Site.......................    Leased          (i)                  60 ft./30 w        09/03/2002

K11TB (low power)
    Tower/Transmitter Site.......................    Leased          (j)                  100 ft./10 w       05/15/2000

Odessa and Midland, Texas KOSA-TV

    Office and Studio............................   Owned(b)     14,222 sq. ft.               --                 --
    Tower/Transmitter Site.......................    Leased         930 sq. ft.           726 ft./316 kw      10/31/2003

Quincy, Illinois, Hannibal, Missouri
and Keokuk, Iowa KHQA-TV
    Office and Studio............................    Owned       18,000 sq. ft.               --                 --
    Tower/Transmitter Site.......................   Owned(b)      1,200 sq. ft.           804 ft./269 kw         --

Dothan, Alabama and Panama City, Florida
WTVY-TV
    Office and Studio............................    Leased      20,440 sq. ft.               --             12/31/2002
    Tower/Transmitter Site.......................   Owned(b)      2,500 sq. ft.         1,880 ft./100 kw         --

Harrisonburg, Virginia WHSV-TV
    Office and Studio............................  Leased(b)     18,000 sq. ft.               --            4/27/2018(k)
    Tower/Transmitter Site.......................    Leased       2,016 sq. ft.         337 ft./8.32 kw     12/31/2001(l)

Bowling Green, Kentucky WBKO-TV
    Office and Studio............................   Owned(b)     17,598 sq. ft.               --                 --
    Tower/Transmitter Site.......................   Owned(b)      1,175 sq. ft.          603 ft./316 kw          --

Meridian, Mississippi WTOK-TV
    Office and Studio............................   Owned(b)     13,188 sq. ft.               --                 --
    Tower/Transmitter Site.......................   Owned(b)      1,504 sq. ft.          316 ft./316 kw          --

Parkersburg, West Virginia WTAP-TV
    Office and Studio............................  Leased(b)     17,500 sq. ft.               --            04/30/2005(m)
    Tower/Transmitter Site.......................    Owned        3,600 sq. ft.          439 ft./208 kw          --
</TABLE>

                                     - 18 -




<PAGE>


<TABLE>
<CAPTION>
                                                      OWNED       APPROXIMATE                                EXPIRATION
 STATION, MARKET AREA AND USE                       OR LEASED      SIZE (a)                HEIGHT/POWER       OF LEASE
-------------------------------------------------  -----------   -----------              --------------    -----------
<S>                                                 <C>           <C>                     <C>                 <C>
Cheyenne, Wyoming KGWN-TV
    Office and Studio...........................   Owned(b)      7,500 sq. ft.                --                --
    Tower/Transmitter Site......................     (n)         2,646 sq. ft.           620 ft./100 kw         --

Scottsbluff, Nebraska KSTF-TV (satellite)
    Office and Studio...........................    Owned        2,400 sq. ft.                --                --
    Tower/Transmitter Site......................    Owned        2,457 sq. ft.           674 ft./240 kw         --

Casper and Riverton, Wyoming KGWC-TV
    Office and Studio...........................    Leased      10,000 sq. ft.                --           03/04/2007(o)
    Tower/Transmitter Site......................    Owned        1,692 sq. ft.           235 ft./60 kw          --

Lander, Wyoming KGWL-TV (satellite)
    Tower/Transmitter Site......................    Leased         768 sq. ft.           155 ft./30 kw     12/31/2007

Rock Springs, Wyoming KGWR-TV (satellite)
    Tower/Transmitter Site......................    Leased         400 sq. ft.           100 ft./12 kw     05/22/2009

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

(b)  The Company has mortgaged its interest in this property to Toronto Dominion
     (Texas), Inc., as administrative agent and collateral agent, as collateral
     for its obligations under the Company's loan agreement.

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

(d)  The Company has mortgaged its interest in this property to Chicopee Savings
     Bank, as collateral for its obligations to the bank under a construction
     loan.

(e)  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.

(f)  Leased together with Shockley Communications Corporation and the Wisconsin
     Educational Communications Board from the State of Wisconsin Department of
     Natural Resources.

(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 Communications, Inc., which owns and
     operates radio stations WIBW AM and FM. The lease will expire on the
     earlier of February 28, 2002 or when a certificate of occupancy is issued
     for a new facility the land for which was purchased by the Company on
     February 29, 2000. The new facility is expected to be built on the recently
     purchased property.

(h)  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.

(i)  The Company leases rooftop space for its tower/transmitter.

(j)  The Company leases space on a tower on which it has mounted a broadcasting
     antenna.

(k)  The Company has an option to purchase the premises at various times during
     the term of the lease. At December 31, 1999, the purchase price was
     $1,477,148.

(l)  Occupied pursuant to a Special Use Permit granted by the United States
     Department of Agriculture Forest Service.

(m)  The Company has exercised an option to purchase the premises on May 1, 2000
     for $650,000.

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

(o)  The Company has an option to purchase the premises during the term of the
     lease at purchase prices that are subject to adjustment during the lease
     term based on the date the option is exercised. The purchase price would
     have been $400,435 as of December 31, 1999.

</TABLE>

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 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.

                                     - 19 -




<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, 1999 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,
1999 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,
                                       ------------------------------------------------------------------------
                                        1995 (a)        1996 (b)          1997            1998         1999 (c)
                                       ----------      ----------     ----------      ----------     ----------
                                                    (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<S>                                      <C>              <C>          <C>             <C>             <C>
STATEMENT OF OPERATIONS DATA:
Net revenue (d)......................    $ 50,329         $96,386      $ 127,073       $ 139,833       $140,406
Operating expenses:
    Station operating expenses.......      29,049          58,603         80,003          85,509         86,594
    Depreciation and amortization....       5,041          20,220         31,380          30,830         28,520
                                       ----------      ----------     ----------      ----------     ----------
Station operating income.............      16,239          17,563         15,690          23,494         25,292
    Corporate expenses...............       1,576           2,695          3,787           4,643          4,510
                                       ----------      ----------     ----------      ----------     ----------
                                           14,663          14,868         11,903          18,851         20,782
Net gain on sale of stations (e).....           -               -              -               -          6,181
                                       ----------      ----------     ----------      ----------     ----------
    Operating income.................      14,663          14,868         11,903          18,851         26,963
                                       ----------      ----------     ----------      ----------     ----------
Financial expenses, net:
Interest expense, net (f):
    Cash interest, net...............     (14,763)        (22,559)       (28,866)        (26,485)       (25,077)
    Other interest...................        (712)         (8,130)       (19,374)        (17,043)       (19,040)
                                       ----------      ----------     ----------      ----------     ----------
                                          (15,475)        (30,689)       (48,240)        (43,528)       (44,117)
                                       ----------      ----------     ----------      ----------     ----------
Income (loss) before income tax
    benefit and extraordinary item...        (812)        (15,821)       (36,337)        (24,677)       (17,154)
Income tax benefit (g)...............           -           4,664         12,027           8,052          1,377
                                       ----------      ----------     ----------      ----------     ----------
Income (loss) before extraordinary
    item.............................        (812)        (11,157)       (24,310)        (16,625)       (15,777)
Extraordinary item (h)...............       6,864               -              -               -        (12,510)
                                       ----------      ----------     ----------      ----------     ----------
Net income (loss)....................       6,052         (11,157)       (24,310)        (16,625)       (28,287)

Preferred stock dividends and
    accretion........................           -          (9,519)       (19,037)        (30,855)       (18,987)
                                       ----------      ----------     ----------      ----------     ----------
Net income (loss) applicable to
   common stock......................     $ 6,052        $(20,676)      $(43,347)       $(47,480)      $(47,274)
                                       ==========      ==========     ==========      ==========     ==========
   Basic earnings (loss) per common
     share (i):
   (Loss) before extraordinary item..     $ (0.12)        $ (2.94)       $ (6.17)        $ (6.42)       $ (4.70)
   Extraordinary item................        0.98               -              -               -          (1.69)
                                       ----------      ----------     ----------      ----------     ----------
   Earnings (loss) per common share..     $  0.86         $ (2.94)       $ (6.17)        $ (6.42)       $ (6.39)
                                       ==========      ==========     ==========      ==========     ==========
   Weighted-average common shares
       outstanding...................   7,030,000       7,030,000      7,030,000       7,400,000      7,400,000
                                       ==========      ==========     ==========      ==========     ==========
</TABLE>

                                     - 20 -




<PAGE>

<TABLE>
<CAPTION>
                                                           1995 (a)    1996 (b)      1997       1998      1999(c)
                                                           --------    --------      ----       ----      -------
                                                              (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<S>                                                        <C>         <C>         <C>        <C>         <C>
 STATEMENT OF CASH FLOWDATA:
   Net cash provided by operating activities........        $ 3,250     $17,843     $ 8,471    $20,016     $19,302
   Net cash (used in) investing activities..........        (30,972)   (326,632)     (6,282)    (6,582)    (28,291)
   Net cash provided by (used in) financing activities       32,773     307,212      (7,632)   (11,791)      7,976

CERTAIN FINANCIAL DATA:
    Broadcast cash flow (j)1........................        $21,310     $38,864     $47,534    $54,830     $54,625
    Broadcast cash flow margin (k) 1................          42.3%       40.3%       37.4%      39.2%       39.0%

    Adjusted EBITDA (l) 1...........................        $19,734     $36,169     $43,747    $50,187     $50,115
    Adjusted EBITDA margin (m) 1....................          39.2%       37.5%       34.4%      35.9%       35.8%

    Amortization of program broadcast rights........        $ 2,162     $ 4,399     $ 6,401    $ 6,758     $ 8,127
    Payments on program broadcast liabilities.......          2,132       3,318       5,937      6,399       7,455
    Capital expenditures............................          2,008       5,003      10,833     10,147      12,784
       1Excludes BCI, a nonrecourse subsidiary

 BALANCE SHEET DATA (END OF PERIOD):
    Total assets....................................       $114,453    $495,015    $468,495   $447,462    $457,776
    Working capital.................................         13,665       3,697       2,511      3,555      20,407
    Long-term debt (n)..............................        135,767     358,234     370,917    374,816     427,579
    Redeemable preferred stock......................              -     105,519     124,556    162,644     181,631
    Stockholders' (deficit).........................       (36,564)    (51,561)    (94,908)  (147,263)   (197,494)
-------------
(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 thirteen television stations. The
     statement of operations and other data does not include information with
     respect to these acquisitions prior to June 6, 1996.

(c)  In January 1999, the Company effected a TBA in anticipation of the "Station
     Swap" of KKTV and KCOY-TV. The statement of operations and other data for
     the year ended December 31, 1999 includes information with respect to the
     TBA.

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

(e)  Net gain on sale of stations includes $13.3 million as a result of the
     "Station Swap" netted against a $0.2 million loss from the sale of KTVS-TV
     (a satellite operation of KGWN-TV) and a $6.9 million expected loss on the
     sale of KOSA-TV.

(f)  Cash interest expense, net includes cash interest paid and normal
     adjustments to accrued interest. Other interest expense includes accrued
     interest added to long-term debt balances, deferred loan cost amortization
     and write offs (except deferred loan cost write offs related to
     extraordinary debt extinguishments), financing costs not consummated, and
     accretion of discounts.

(g)  Prior to June 1996, the Company had elected to be taxed as an S Corporation
     for federal and state income tax purposes. The Company's election to be
     taxed as an S Corporation terminated on June 6, 1996. Accordingly, while
     the Company became subject to federal and state income taxes on that date,
     the then sole stockholder of the Company is responsible for the payment of
     income taxes on the Company's taxable income for any time prior to the
     termination date.

(h)  In 1995, 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. In 1999,
     the Company recorded an extraordinary loss of $12.5 million net of
     applicable taxes of $8.4 million as a result of the early extinguishment of
     debt associated with the completion of the tender offer for $135.0 million
     of outstanding notes.

(i)  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 and initial warrants has not been reflected in the
     computation since their inclusion as common stock equivalents for both
     basic and fully-diluted earnings (loss) per share was anti-dilutive.

(j)  Broadcast cash flow is defined as operating income, excluding net income of
     nonrecourse subsidiaries, before financial income as derived from the
     consolidated statements of operations plus depreciation and amortization,
     amortization of program broadcast rights, corporate expenses and noncash
     compensation less payments on program broadcast liabilities and net gain on
     sale of stations. The Company has included broadcast cash flow data because
     (i) the information is a measurement utilized by lenders to measure the
     Company's ability to service its debt and pay for capital expenditures,
     (ii) the information is a measurement utilized by industry analysts to
     determine a market value of the Company's television stations and (iii) the
     information is a measurement industry analysts utilize when evaluating and
     comparing the operating performance of the Company. 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. Broadcast cash flow is also not reflected in the
                                     - 21 -







<PAGE>


     Company's consolidated statements of cash flows; but it is a common and
     meaningful measure for comparison to other companies in the broadcast
     industry. The amounts excluded from broadcast cash flow are significant
     components in understanding and assessing the Company's results of
     operations and cash flows. The term "broadcast cash flow" may not be the
     same terminology utilized by other companies in the presentation of similar
     information.

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

(l)  Adjusted EBITDA is defined as operating income, excluding net income of
     nonrecourse subsidiaries, 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 on program broadcast liabilities and net gain on sale of stations.
     The Company has included Adjusted EBITDA data because (i) the information
     is a measurement utilized by lenders to measure the Company's ability to
     service its debt and pay for capital expenditures, (ii) the information is
     a measurement utilized by industry analysts to determine a private market
     value of the Company's television stations and (iii) the information is a
     measurement industry analysts utilize when evaluating and comparing the
     operating performance of the Company. 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.
     Adjusted EBITDA is also not reflected in the Company's consolidated
     statements of cash flows; but it is a common and meaningful measure for
     comparison to other companies in the broadcast industry. The amounts
     excluded from Adjusted EBITDA are significant components in understanding
     and assessing the Company's results of operations and cash flows. The term
     "Adjusted EBIDTA" may not be the same terminology utilized by other
     companies in the presentation of similar information.

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

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

</TABLE>

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 1999, the Company reported net revenues of $140.4 million compared to
net revenues of $139.8 million in 1998 and $127.1 million in 1997. The results
for 1998 were favorably impacted by political revenue of $12.6 million compared
to $1.1 million in 1997 and $1.5 million in 1999. The Company had a net loss of
$28.3 million for 1999 compared to a net loss of $16.6 million for 1998 and a
net loss of $24.3 million for 1997. Adjusted EBITDA for 1999 was $50.1 million
as compared to $50.2 million for 1998 and $43.7 million for 1997.

     Net revenues and operating cash flow of the Company are generally higher
during the fourth quarter of each year, primarily due to increased expenditures
by advertisers in anticipation of the holiday season, consumer spending, an
increase in viewership during this period, and political advertising
expenditures in even numbered years, and to a lesser extent, during the second
quarter of each year.

     Time sales to local/regional advertisers and national advertisers
constitute the largest concentration of the Company's operating revenues and
represent approximately 88.1% of gross revenues in 1999 as compared to 87.2% in
1998. Excluding political advertising revenue, however, the percentage of gross
revenues attributable to local/regional advertising and national advertising of
the Company in 1997, 1998 and 1999 was 85.9%, 86.1% and 88.0%, respectively.
Approximately 57.0% of the gross revenues of the

                                     - 22 -




<PAGE>


Company in 1999 were 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.

     The Company's primary operating expenses are employee compensation,
programming, 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. Under its
contract with the network, a network-affiliated station receives approximately
two-thirds of its daily programming from its network and in turn is compensated,
in most cases, by the network for carrying such programming with the network's
commercial content intact. 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 64.9% of net revenues for 1999 as compared to 64.5% for 1998 and
65.9% of net revenues for 1997.

     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.

     The Company believes that Adjusted EBITDA and broadcast cash flow
information discussed below provide meaningful information as to the performance
of the television stations owned by the Company, particularly information that
is presented on a Same Station basis. Changes from year to year indicate how the
Company has performed in its efforts to increase net sales and manage expenses
on an operating basis.

     The following table sets forth certain historical results of the operations
and operating data for the periods indicated. The table reflects the operating
effects of the TBA associated with the exchange of KCOY-TV for KKTV (the
"Station Swap") only since January 1, 1999.

<TABLE>
<CAPTION>
                                                                YEARS ENDED DECEMBER 31,
                                                      ----------------------------------------------
                                                         1997           1998             1999
                                                         ----           ----             ----
                                                                     (IN THOUSANDS)

<S>                                                      <C>             <C>              <C>
       Operating income.........................         $ 11,903        $  18,851        $  26,963
           Add:
             Amortization of program broadcast
               rights...........................            6,401            6,758            8,127
             Depreciation and amortization......           31,380           30,830           28,520
             Corporate expenses.................            3,787            4,643            4,510
             Operating loss of BCI..............                -              147              141
           Less:
              Payments on program
                broadcast liabilities...........           (5,937)          (6,399)          (7,455)
              Net gain on sale of stations......                -                -           (6,181)
                                                         --------         --------         --------
       Broadcast cash flow1.....................         $ 47,534         $ 54,830         $ 54,625
                                                         ========         ========         ========

          1 Excludes BCI, a nonrecourse subsidiary

</TABLE>

                                     - 23 -




<PAGE>


YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998

     The following table provides both historical information and Same Station
information for the year ended December 31, 1998 and 1999. The Same Station
information gives effect to the Station Swap as if the exchange was consummated
prior to January 1, 1998.

<TABLE>
<CAPTION>
                                                  HISTORICAL                          SAME STATION1
                                            YEAR ENDED DECEMBER 31,               YEAR ENDED DECEMBER 31,
                                       --------------------------------       --------------------------------
                                         1998        1999      % CHANGE        1998        1999       % CHANGE
                                       --------     -------    --------       -------     -------     --------
                                                                  (IN THOUSANDS)
<S>                                     <C>         <C>            <C>        <C>         <C>           <C>
Local/regional......................    $85,900     $92,269        7.4%       $89,160     $91,892         3.1%
National............................     41,570      48,901       17.6         45,065      48,817         8.3
Political...........................     12,551       1,476      (88.2)        11,113       1,476       (86.7)
Other...............................     20,640      19,238       (6.8)        20,581      18,355       (10.8)
                                       --------     -------     -----         -------     -------      ------
                                        160,661     161,884        0.8        165,919     160,540        (3.2)
Direct costs........................     20,828      21,478        3.1         21,727      21,344        (1.8)
                                       --------     -------     -----         -------     -------      ------
Net revenues........................   $139,833    $140,406        0.4%      $144,192    $139,196        (3.5)%
Operating expenses:
    Selling, technical and
      program expenses..............     64,651      66,793       3.3          70,091      66,553        (5.0)
    General and administrative......     20,858      19,801      (5.1)         18,115      18,101        (0.1)
    Depreciation and amortization.       30,830      28,520      (7.5)         31,306      28,676        (8.4)
    Corporate.......................      4,643       4,510      (2.9)          4,668       4,510        (3.4)
                                       --------     -------     -----         -------     -------      ------
                                        120,982     119,624      (1.1)        124,180     117,840        (5.1)

Net gain (loss) on sale of stations.          -       6,181     100.0               -     (7,142)      (100.0)
                                       --------     -------     -----         -------     -------      ------
    Operating income................   $ 18,851     $26,963      43.0%        $20,012     $14,214       (29.0)%
                                       ========     =======     =====         =======     =======      ======
Broadcast cash flow 1...............   $ 54,830     $54,625      (0.4)%       $56,328     $55,265        (1.9)%
Broadcast cash flow margin 1........      39.2%       39.0%                     39.1%       39.7%
Adjusted EBITDA 1...................   $ 50,187     $50,115      (0.1)%       $51,660     $50,755        (1.8)%
Adjusted EBITDA margin 1............      35.9%       35.8%                     35.8%       36.5%


   1 Excludes BCI, a nonrecourse subsidiary

</TABLE>

     Net revenues for the year ended December 31, 1999 increased $0.6 million or
0.4% to $140.4 million from $139.8 million for the year ended December 31, 1998.
Gross revenues excluding political advertising revenue increased $12.3 million
or 8.3% to $160.4 million from $148.1 million for the year ended December 31,
1998. On a Same Station basis, net revenues for the year ended December 31, 1999
were $139.2 million as compared to $144.2 million for the year ended December
31, 1998. Net revenues for the year ended December 31, 1999 reflected an
increase in advertising demand which offset the absence of the Winter Olympics
on the Company's 12 CBS stations and a decline in political advertising both of
which positively affected the year ended December 31, 1998. Political
advertising revenue for the year ended December 31, 1999 was $1.5 million
compared to $12.6 million for the year ended December 31, 1998.

     Operating expenses for the year ended December 31, 1999 decreased $1.4
million or 1.1% to $119.6 million from $121.0 million for the year ended
December 31, 1998. The decrease in operating expenses was attributable to a
decrease in depreciation and amortization, and payroll related costs which were
offset in part by increased costs due to the effect of the Station Swap. As a
percentage of net revenues, operating expenses decreased to 85.2% for the year
ended December 31, 1999 compared to 86.5% for the same period ending 1998. On a
Same Station basis, operating expenses for the year ended December 31, 1999
decreased $6.4 million or 5.1% to $117.8 million from $124.2 million for the
year ended December 31, 1998. The decrease in operating expenses resulted
primarily from a reduction in depreciation and amortization, promotional
expenses and decreased payroll-related costs.

                                     - 24 -




<PAGE>


     Net gain (loss) on sale of stations, includes $13.3 million as a result of
the Station Swap where the assets of KCOY-TV with a fair market value of $24.3
million were exchanged for the assets of KKTV. The book value of the KCOY-TV
assets were $10.8 million and related fees were $0.2 million. Gain on the sale
of stations also includes a $0.2 million loss on the sale of KTVS-TV (a
satellite operation of KGWN-TV) and an anticipated $6.9 million loss on the sale
of KOSA-TV.

     Operating income for the year ended December 31, 1999 increased $8.1
million or 43.0% to $27.0 million from $18.9 million for the year ended December
31, 1998. On a Same Station basis, operating income for the year ended December
31, 1999 decreased $5.8 million or 29.0% to $14.2 million from $20.0 million for
the year ended December 31, 1998.

     Financial (expenses), net for the Company for the year ended December 31,
1999 increased $0.6 million or 1.4% to $44.1 million from $43.5 million in the
year ended December 31, 1998.

     Income tax benefit for the Company for the year ending December 31, 1999
was $1.4 million compared to $8.1 million for the year ended December 31, 1998.
The decrease in income tax benefit is due in part to the $13.3 million gain on
the sale of KCOY-TV. In addition, the $6.9 million anticipated loss on the sale
of KOSA-TV was entirely nondeductible as it consisted of a write down of
nondeductible goodwill, which contributed to the decrease in income tax benefit
for the year ended December 31, 1999.

     Extraordinary loss was $12.5 million for the year ended December 31, 1999,
net of applicable income taxes of $8.4 million. The loss was reflected as a
result of the early extinguishment of debt associated with the completion of the
tender offer for $135.0 million of Benedek Broadcasting's outstanding 11 7/8%
Senior Secured Notes due 2005 (the "Notes"). Total consideration of $149.3
million (including a premium of $14.3 million), fees of the transaction and a
write-off of deferred loan costs caused the loss.

     Net loss for the Company was $28.3 million for the year ended December 31,
1999 as compared to a net loss of $16.6 million for the year ended December 31,
1998.

     Broadcast cash flow for the year ended December 31, 1999 decreased $0.2
million or 0.4% to $54.6 million from $54.8 million for the year ended December
31, 1998. As a percentage of net revenues, broadcast cash flow margin decreased
to 39.0% for the year ended December 31, 1999 from 39.2% for the year ended
December 31, 1998.

     On a Same Station basis, broadcast cash flow for the year ended December
31, 1999 decreased $1.0 million or 1.9% to $55.3 million from $56.3 million for
the year ended December 31, 1998. As a percentage of net revenues, broadcast
cash flow margin on a Same Station basis increased to 39.7% for the year ended
December 31, 1999 from 39.1% for the year ended December 31, 1998.

                                     - 25 -




<PAGE>


YEAR ENDED DECEMBER 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997

     The following table provides historical information:

<TABLE>
<CAPTION>
                                                       YEAR ENDED DECEMBER 31,
                                               --------------------------------------
                                                 1997          1998          % CHANGE
                                               --------      --------        --------
                                                         (IN THOUSANDS)

<S>                                             <C>          <C>             <C>
Local/regional.........................         $81,739      $ 85,900            5.1%
National...............................          42,284        41,570           (1.7)
Political..............................           1,103        12,551        1,037.9
Other..................................          20,440        20,640            1.0
                                               --------      --------        -------
                                                145,566       160,661           10.4
Direct costs...........................          18,493        20,828           12.6
                                               --------      --------        -------
Net revenues............................       $127,073      $139,833           10.0%
Operating expenses:
    Selling, technical and program
      expenses.........................          60,385        64,651            7.1
    General and administrative.........          19,618        20,858            6.3
    Depreciation and amortization......          31,380        30,830           (1.8)
    Corporate..........................           3,787         4,643           22.6
                                               --------      --------        -------
                                                115,170       120,982            5.0
                                               --------      --------        -------
        Operating income...............        $ 11,903      $ 18,851           58.4%
                                               ========      ========        =======

Broadcast cash flow 1..................        $ 47,534      $ 54,830           15.3%
Broadcast cash flow margin 1...........           37.4%         39.2%
Adjusted EBITDA 1......................        $ 43,747      $ 50,187           14.7%
Adjusted EBITDA margin 1...............           34.4%         35.9%


    1 Excludes BCI, a nonrecourse subsidiary

</TABLE>

     Net revenues for the year ended December 31, 1998 increased $12.7 million
or 10.0% to $139.8 million from $127.1 million for the year ended December 31,
1997. Gross revenues excluding political advertising revenue increased $3.6
million or 2.5% to $148.1 million from $144.5 million for the year ended
December 31, 1997. Net revenues for the year ended December 31, 1998 were
positively affected by political spending and the Winter Olympics shown on the
Company's 12 CBS stations. Political advertising revenue for the year ended
December 31, 1998 increased by $11.5 million to $12.6 million compared to $1.1
million in 1997. Net revenues for the second half of 1998 were adversely
affected by a General Motors Corporation strike and a continued general weakness
in revenue from national advertising. Gross revenues excluding political
advertising for the second half of 1998 decreased $3.1 million or 4.2% to $71.1
million from $74.2 million for the six months ended December 31, 1997.

     Net revenues during the year ended December 31, 1998 continued to be
adversely affected by weakness in advertising revenue for the Company's six ABC
affiliated stations. Net revenues of the Company's CBS and NBC affiliated
stations increased by 12.0% and 12.0%, respectively, while net revenues of the
Company's ABC affiliated stations increased by 5.2%.

     Operating expenses for the year ended December 31, 1998 increased $5.8
million or 5.0% to $121.0 million from $115.2 million for the year ended
December 31, 1997. The increase in expenses was due in part to increased
compensation expense as the Company expanded news operations during the first
half of 1998, and increased programming expense. As a percentage of net
revenues, operating expenses decreased to 86.5% from 90.6% in the year ended
December 31, 1997.

     Operating income for the year ended December 31, 1998 increased $7.0
million or 58.4% to $18.9 million from $11.9 million for the year ended December
31, 1997.

     Financial (expenses), net for the Company for the year ended December 31,
1998 decreased $4.7 million or 9.8% to $43.5 million from $48.2 million in the
year ended December 31, 1997 due to the lower interest rates on its credit
facility.

                                     - 26 -






<PAGE>


     Income tax benefit for the year ended December 31, 1998 for the Company was
$8.1 million compared to $12.0 million for the year ended December 31, 1997. The
tax effect of the excess of book depreciation over tax depreciation and a
current period net operating loss for tax purposes were the primary factors
resulting in the income tax benefit for the year ended December 31, 1998

     Net loss for the Company was $16.6 million for the year ended December 31,
1998 as compared to a net loss of $24.3 million for the year ended December 31,
1997.

     Broadcast cash flow for the year ended December 31, 1998 increased $7.3
million or 15.3% to $54.8 million from $47.5 million for the year ended December
31, 1997. As a percentage of net revenues, broadcast cash flow margin increased
to 39.2% for the year ended December 31, 1998 from 37.4% for the year ended
December 31, 1997.

LIQUIDITY AND CAPITAL RESOURCES

     Cash Flows from Operating Activities is the primary source of liquidity for
the Company and were $19.3 million for the year ended December 31, 1999 compared
to $20.0 million for the year ended December 31, 1998. Cash payments of interest
expense totaled $30.3 million for the year ended December 31, 1999 as compared
to $27.1 million for the year ended December 31, 1998 and resulted in the
decrease in cash flows from operating activities.

     Cash Flows from Investing Activities were $(28.3) million for the year
ended December 31, 1999, as compared to $(6.6) million for the year ended
December 31, 1998. The change in cash flows from investing activities for the
year ended December 31, 1999 was the result of a $9.4 million outlay for the
purchase of KKTV and $10.3 million in a deposit and costs of the pending
purchase of KAKE-TV and WOWT-TV.

     Cash Flows from Financing Activities were $8.0 million for the year ended
December 31, 1999 compared to $(11.8) million for the year ended December 31,
1998. On May 20, 1999, Benedek Broadcasting borrowed $275.0 million against a
new credit facility (the "Credit Facility"), which was amended June 18, 1999.
The proceeds were used to pay off the existing term loans totaling $108.3
million and redeem 100% of the Notes for $149.3 million, which consisted of
$135.0 million in principal and $14.3 million in premium. Fees and expenses
associated with the redemption were $0.6 million. The Company also repurchased a
portion of its 13 1/4% Senior Subordinated Discount Notes due 2006 (the
"Discount Notes") with a face amount of $3.0 million for $2.6 million. In
addition, the Company acquired its warrants to purchase an aggregate of 185,000
shares of Class A common stock for $3.0 million. Of the 600,000 initial warrants
issued during 1996, 365,000 warrants remain outstanding at December 31, 1999.

       For the year ended December 31, 1998, cash flows from financing
activities included $100.0 million of proceeds from the issuance of the
Company's 11 1/2% Exchangeable Senior Preferred Stock (the "Senior Preferred
Stock") issued in June 1998. The proceeds were used to redeem the Company's
15.0% Exchangeable Redeemable Senior Preferred Stock due 2007 totaling $92.8
million (including $12.1 million representing premiums relating to the
redemption) and to pay fees and expenses totaling $4.3 million associated with
the offering. Cash flows from financing activities for the year ended December
31, 1998 also included $0.5 million to acquire warrants to purchase 50,000
shares of the Company's Class A common stock.

     The Credit Facility includes an aggregate borrowing limit of $310.0 million
consisting of a $220.0 million term loan (the "Term Loan") and a $90.0 million
revolving credit facility (the "Revolver"). The Credit Facility contains certain
financial covenants, including, but not limited to, covenants related to
interest coverage, total and senior leverage ratios and fixed charge ratio. In
addition, the Credit Facility contains 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

                                     - 27 -





<PAGE>


Company) transactions with affiliates, mergers and acquisitions, sales of
assets, guarantees and investments. The Credit Facility also contains customary
events of default for highly-leveraged financings, including certain changes in
ownership or control of the Company.

     At December 31, 1999, the Company had borrowed $220.0 million under the
Term Loan and $58.5 million under the Revolver. At December 31, 1999, the
Company could have borrowed approximately an additional $4.2 million under the
Revolver. During the year ended December 31, 1999, the highest outstanding
balance under the Revolver was $58.5 million. The Company's ability to draw
funds under the Revolver is limited by its level of earnings and its ability to
meet certain financial covenants.

     The commitment under the Revolver will be permanently reduced over the
period from June 2002 to maturity in 2007, as follows: 2002 - $10.1 million;
2003 - $13.5 million; 2004 - $16.9 million; 2005 - $21.4 million; 2006 - $22.5
million; and 2007 - $5.6 million. In addition, the commitment under the Revolver
will be permanently reduced in certain circumstances including upon the sales of
certain assets and the issuance of certain debt or equity securities and from
Excess Cash Flow (as defined in the Credit Facility). The Company has the right
to pay off the Revolver without penalty in increments of $1.0 million.

     The Term Loan and the Revolver bear interest initially at the Company's
option, at a base rate plus 2.25% and 1.75%, respectively, or at a LIBOR rate
plus 3.25% and 2.75%, respectively. The margins above the base rate and the
LIBOR rate at which the Term Loan and the Revolver bear interest are subject to
reductions based on certain leverage ratios. The unused portion of the Revolver
is subject to a commitment fee ranging from 0.75% per annum to 0.375% per annum
based on certain leverage ratios.

     The Company is required to make scheduled amortization payments on the Term
Loan, as follows: 2002 - $1.7 million; 2003-$2.2 million; 2004 - $2.2 million;
2005 - $2.2 million; 2006 - $2.2 million; and 2007 - $209.5 million. In
addition, the Company is required to make prepayments on the Term Loan and the
Revolver under certain circumstances, including upon the sale of certain assets
and the issuance of certain debt or equity securities. Beginning in 2002, the
Company is required to make prepayments on the Term Loan and the Revolver in an
amount equal to 50% of Excess Cash Flow.

     The Term Loan and the Revolver are secured by certain of the Company's
present and future assets. The Company and its subsidiaries, other than BCI,
guaranteed the obligation of Benedek Broadcasting under the Credit Facility. The
ownership interest of Benedek Broadcasting in its subsidiaries, including
Benedek License Corporation ("BLC"), which holds the FCC licenses and
authorizations for the Stations, has been pledged as collateral for the loans.

     In 1996, the Company issued Discount Notes in the principal amount of
$170.0 million. The Discount 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 Discount Notes are redeemable at the
option of the Company, in whole or in part, at predetermined redemption prices
and under specified conditions. The Discount Notes are subordinated to all other
senior debt of the Company. The Discount Notes contain various restrictive
covenants.

     During July 1999, the Company retired a portion of its Discount Notes with
a face amount of $3.0 million. The Discount Notes had an accreted value of $2.4
million and were purchased for a total of $2.6, million which included a $0.2
premium payment for early retirement.

     Dividends on the Senior Preferred Stock are cumulative and payable
quarterly commencing August 15, 1998 at a rate of 11.5% of the then effective
liquidation preference per share. The Company, at its option, may pay dividends
on any dividend payment date occurring on or before May 15, 2003 either in cash
or by adding such dividends to the then effective liquidation preference. The
Company has been adding the dividends to the liquidation preference from
issuance date through December 31, 1999. The

                                     - 28 -





<PAGE>


Senior Preferred Stock is not redeemable until May 15, 2003 at which time
cash dividends are required at a rate of 11.5% of the then effective liquidation
preference per share. Thereafter, the Company has the option to redeem these
shares in whole or in part at predetermined redemption prices. The Senior
Preferred Stock contains various restrictive covenants relating to limitations
on dividends, transactions with affiliates, further issuance of debt, and the
sales of assets, among other things. Notwithstanding the foregoing, until May
15, 2001, in the event of a public equity offering, a Required Disposition (as
defined) or other specified circumstances, the Company may redeem up to 25.0% of
the initial liquidation preference at 111.50% of the then effective liquidation
preference, provided at least $75.0 million in liquidation preference remains
outstanding. The Credit Facility currently prohibits the Company from making
cash payments with respect to the Senior Preferred Stock at any time.
Accordingly, the Company currently intends not to pay cash dividends on the
Senior Preferred Stock prior to May 15, 2003.

     Dividends on the Junior Discount Preferred Stock due July 1, 2008 (the
"Junior Preferred Stock") are payable to the holders of the Junior Preferred
Stock at 7.92% per annum, cumulative June 5, 2001 and thereafter at increasing
rates up to 18%. The Junior Preferred Stock had an aggregate liquidation
preference of $59.5 million at December 31, 1999. Since the Company intends to
redeem the Junior Preferred Stock prior to June 5, 2001, dividends are being
accrued at the initial rate. The dividends on the Junior Preferred Stock are
cumulative. Prior to and including June 5, 2001, dividend payments on the Junior
Preferred Stock are not permitted to 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. For all dividend payment dates with respect to
the Junior Preferred Stock prior to and including June 5, 2001, the Company will
pay such dividends by adding the amount thereof to the then effective
liquidation preference of the Junior Preferred Stock.

     The Junior 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.

     The Company is a holding company that derives all of its operating income
and Adjusted EBITDA from its subsidiary, Benedek Broadcasting. As a holding
company, the Company's ability to pay its obligations, including its obligation
to pay interest on and principal of the Discount Notes, whether at maturity,
upon a change of control or otherwise, is 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.

     The Company anticipates that Adjusted EBITDA of the Company will be
sufficient to finance the operating requirements of the Stations, debt service
requirements of the Credit Facility and presently anticipated capital
expenditures for at least the period until the Company is required to make cash
payments in respect of the Discount Notes. The Company expects that at that time
it will be necessary to refinance the Discount Notes and the Junior Preferred
Stock. Such refinancing will also require amending or refinancing the Credit
Facility since it currently prohibits the repayment or redemption of the
Discount Notes or the redemption of the Junior Preferred Stock.

     RECENT DEVELOPMENTS

     On November 19, 1999, the Company entered into an Asset Purchase Agreement
with Chronicle and on December 10, 1999, the Company entered into an Asset
Exchange Agreement with WGRC. Pursuant to these agreements, WGRC will acquire
the television broadcast assets of WOWT-TV and KAKE-TV, Chronicle's television
stations in Omaha, Nebraska and Wichita, Kansas, respectively, and then
immediately transfer the same to the Company in exchange for the television
broadcast assets of WWLP-TV, the Company's station in Springfield,
Massachusetts. The proposed transaction will include an

                                     - 29 -




<PAGE>


$18.0 million payment by the Company to WGRC. At December 31, 1999, the Company
had deposited $10.0 million in an escrow account related to this transaction.
The remaining $8.0 million will be funded from the proceeds related to the sale
of KOSA-TV as discussed below. The transaction will be structured, to the extent
feasible, as a tax-free exchange pursuant to Section 1031 of the Internal
Revenue Code and recorded under the purchase method of accounting. The
transaction has been approved by the FCC and is expected to close in the first
quarter of 2000.

     On December 15, 1999, the Company entered into an Asset Purchase Agreement
with ICA pursuant to which the Company would sell the television broadcast
assets of KOSA-TV, in Odessa, Texas to ICA for a cash payment of $8.0 million.
Accordingly, the Company recorded a lower of cost or market adjustment of
approximately $6.9 million in 1999 to write down the assets of KOSA-TV to the
sales price less estimated selling costs. This transaction was completed on
March 21, 2000.

     In January 2000, the FCC granted its approval to assign all of the FCC
licenses and authorizations from WMTV License Co., LLC ("License Co.") to BLC.
License Co. was wholly owned by Philip A. Jones, solely in his capacity as
trustee under The WMTV Trust, which was formed to hold the assets of television
station WMTV (TV), Madison, Wisconsin to comply with FCC rules and regulations.
Effective as of February 29, 2000, The WMTV Trust transferred all of the assets
of WMTV to Benedek Broadcasting, and License Co. transferred all of the FCC
licenses and authorizations to BLC.

     The Company amended the Credit Facility as of March 23, 2000. The amendment
modified the Senior Leverage Ratio (as defined in the Credit Facility)
applicable for all fiscal quarters of the year ending December 31, 2000.

INCOME TAXES

     For the year ended December 31, 1999, the Company had an income tax benefit
of $1.4 million compared to $8.1 million for the year ended December 31, 1998.
The decrease in income tax benefit is due in part to the $13.3 million gain on
the sale of KCOY-TV. In addition, the $6.9 million anticipated loss on the sale
of KOSA-TV was entirely nondeductible as it consisted of a write down of
nondeductible goodwill, which contributed to the decrease in income tax benefit
for the year ended December 31, 1999.

     Under the provisions of the Internal Revenue Code, the Company has
approximately $26.2 million of actual net operating loss carryforwards available
to offset future tax liabilities. These net operating loss carryforwards expire
between 2007 through 2019.

PENDING ADOPTION OF ACCOUNTING STANDARD

     The FASB (Financial Accounting Standards Board) has issued FASB statement
No. 133 "Accounting for Derivative Instruments and Hedging Activities" which the
Company will be required to adopt for its fiscal year ending December 31, 2001.
This pronouncement establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, (collectively referred to as derivatives) and for hedging activities.
It requires that an entity recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those instruments
at fair value. This pronouncement is not expected to have a significant impact
on the Company's financial statements since the Company's only financial
instrument is an interest rate cap.

                                     - 30 -




<PAGE>


     ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     During August 1999, in accordance with certain covenants of the Credit
Facility, the Company entered into an interest rate cap agreement which matures
in September 2001, 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 British
Bankers' Association interest settlement rates ("settlement rate") for U.S.
dollar deposits exceeds 8.00% on a notional amount totaling $70,000,000 subject
to an amortization schedule. As of December 31, 1999, the settlement rate was
6.18%. 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.

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.

                                     - 31 -




<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......................      60    Chairman, Chief Executive Officer and Director
     K. James Yager..........................      64    President, Chief Operating Officer and Director
     Ronald L. Lindwall......................      54    Senior Vice President-Finance, Chief Financial
                                                          Officer, Treasurer, Secretary and Director
     Terrance F. Hurley......................      44    Senior Vice President of Benedek Broadcasting
     Raymond P. Maselli......................      58    Senior Vice President of Benedek Broadcasting
     Clyde G. Payne..........................      63    Senior Vice President of Benedek Broadcasting
     Raymond J. Schonbak.....................      57    Senior Vice President of Benedek Broadcasting
     Keith L. Bland..........................      44    Senior Vice President-Planning and Technology of
                                                          Benedek Broadcasting
     Mary L. Flodin..........................      44    Vice President and Controller
     Jay Kriegel.............................      59    Director
     Paul S. Goodman.........................      45    Director
</TABLE>

     Mr. A. Richard Benedek has been engaged in the television broadcasting
industry for over 20 years. Mr. Benedek is the Chairman and Chief Executive
Officer of the Company, a position he has held since the formation of the
Company in 1996. 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. 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. Benedek currently serves on the board of directors of the
ABC Affiliates Association.

     Mr. K. James Yager has been engaged in the television broadcasting industry
for over 40 years. Mr. Yager is the President and Chief Operating Officer of the
Company, positions he has held since the formation of the Company in 1996. 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 been a director of Benedek Broadcasting
since 1986. Mr. Yager was employed by Cosmos Broadcasting from 1960 until 1980,
most recently 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. Yager
was elected Chairman of the Joint Board of the National Association of
Broadcasters (NAB) in June of 1999 after serving for a year as Chairman of the
NAB's Television Board. Mr. Yager also serves on the board of directors of
Broadcast Music, Inc. and the Television Bureau of Advertising.

     Mr. Ronald L. Lindwall is the Senior Vice President-Finance, Chief
Financial Officer, Secretary and Treasurer of the Company, positions he has held
since the formation of the Company in 1996. 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 been a director of Benedek
Broadcasting since 1994. From 1982 to 1990, Mr. Lindwall was a partner at the
accounting firm of McGladrey & Pullen.

                                     - 32 -




<PAGE>


     Mr. Terrance F. Hurley has served as Senior Vice President of Benedek
Broadcasting since May 1996. From December 1995 until he became Senior Vice
President, 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 December 1995. From 1991 until May 1993, Mr. Hurley was employed
by Dix Communications as the General Sales Manager of KAAL-TV, serving
Rochester-Austin, Minnesota. Mr. Hurley currently serves on the 100 Plus
Committee of the National Association of Broadcasters and the television retail
advertising committee of the board of directors of the Television Bureau of
Advertising. He is also a member of the CBS Advisory Board.

     Mr. Raymond P. Maselli has served as Senior Vice President of Benedek
Broadcasting since March 1997. From 1989 until he became Senior Vice President,
Mr. Maselli served as Vice President, General Manager of WYTV-TV in Youngstown,
Ohio. Mr. Maselli was President and General Manager of WGRZ-TV of Buffalo, New
York from 1988-1989. He was the Vice President of Sales and Programming for
WGRZ-TV from 1983 to 1988.

     Mr. Clyde G. Payne has been engaged in the television broadcasting industry
for 40 years. Mr. Payne was promoted to Senior Vice President of Benedek
Broadcasting effective March 1997. From March 1995 until February 1997, he
served as Divisional Vice President of Benedek Broadcasting. Mr. Payne also
served as General Manager of WBKO-TV, serving Bowling Green, Kentucky, from 1970
until 1997. Mr. Payne was also part owner of WBKO-TV from 1976 until the Station
was acquired by the Company in 1983. Mr. Payne has served as chairman of the
Arbitron Television Advisory Counsel and the ABC Affiliates Association, as well
as Vice Chairman of the Television Board of the National Association of
Broadcasters.

     Mr. Raymond J. Schonbak has served as Senior Vice President of Benedek
Broadcasting since April 1997. Mr. Schonbak was the founder and President of US
Broadcast Group of Shelton, Connecticut from 1995 to 1997. He served as the
Chief Executive Officer of Triad Communications of San Francisco, California
from 1991 to 1995.

     Mr. Keith L. Bland has been engaged in the television broadcasting industry
for over 25 years. Mr. Bland has served as Senior 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 has served as Vice President and Controller of the
Company since its formation in 1996. 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. From 1983 to 1988, Ms. Flodin served in
various financial capacities as Vice President of AMCORE Financial, Inc. Ms.
Flodin currently serves as a director of the Broadcast Cable Financial Managers'
Association.

     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 Group and its predecessor firm. 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 formation in 1996.

                                     - 33 -




<PAGE>


     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.

     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. In 1999, 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 reportable family relationship
exists between any of the executive officers or directors of the Company.

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 five
most highly-compensated executives during the fiscal years ended December 31,
1999, December 31, 1998 and December 31, 1997.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                ANNUAL COMPENSATION
                                                                                --------------------
                                                                                        OTHER              ALL
                                                                                       ANNUAL             OTHER
NAME AND PRINCIPAL POSITION                      YEAR       SALARY($)   BONUS($)   COMPENSATION($)  COMPENSATION($)(a)
---------------------------                      ----       ---------   --------   ---------------  ------------------
<S>                                              <C>        <C>         <C>           <C>                 <C>
A. Richard Benedek, Chairman and                 1999       217,110        --            --               12,671
  Chief Executive Officer                        1998       916,667        --            --               11,326
                                                 1997       750,000        --            --               11,218

K. James Yager, President and Chief Operating
Officer                                          1999       585,000      55,000          --               15,172
                                                 1998       542,667        --            --               14,522
                                                 1997       415,500        --            --               14,875

Ronald L. Lindwall, Senior Vice President-       1999       219,308        --            --                6,379
  Finance, Chief Financial Officer, Secretary    1998       199,231        --            --                4,180
  and Treasurer                                  1997       174,327     25,000           --                4,555

Terrance F. Hurley, Senior Vice President        1999       258,615        --         53,479(b)            5,601
                                                 1998       218,615        --            --                4,897
                                                 1997       174,327        --            --                3,530

Raymond P. Maselli, Senior Vice President        1999       214,481        --         22,311(c)            7,883
                                                 1998       199,231        --            --                7,365
                                                 1997       174,352        --            --                7,703

Raymond J. Schonbak, Senior Vice
  President                                      1999       298,269        --            --               11,504
                                                 1998       250,000        --            --                9,504
                                                 1997       182,693        --         99,561(d)            5,544

--------------
(a)  Represents the amount of the Company's contribution under its 401(k) plan
     and life insurance premiums.

(b)  Represents relocation expenses ($24,393), amounts reimbursed for the
     payment of taxes ($11,942), living expenses ($10,047), personal use of
     company vehicle and medical insurance.

(c)  Represents relocation expenses ($10,514), amounts reimbursed for the
     payment of taxes ($5,148), personal use of company vehicle and medical
     insurance.

(d)  Represents relocation expenses ($63,554), amounts reimbursed for the
     payment of taxes ($31,116), personal use of company vehicle and medical
     insurance.

</TABLE>

                                     - 34 -





<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. In December
1998, the Company agreed with the lenders under its then existing Credit
Agreement that the amounts permitted to be paid as compensation to Mr. A.
Richard Benedek under the Credit Agreement could be paid to him as loans
instead. The Credit Facility also permits such loans. 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 was employed by Benedek Broadcasting pursuant to an employment
agreement that expired May 31, 1999. During the term of the agreement, Mr.
Lindwall was to be paid at a rate per annum of not less than $150,000. The
employment agreement required Mr. Lindwall to devote his full time to the
business of Benedek Broadcasting. Mr. Lindwall continues to be employed by
Benedek Broadcasting without an employment agreement.

     Mr. Hurley was employed by Benedek Broadcasting pursuant to an employment
agreement that expired May 31, 1999. During the term of the agreement, Mr.
Hurley was to be paid at a rate per annum of not less than $150,000. The
employment agreement required Mr. Hurley to devote his full time to the business
of Benedek Broadcasting and precluded 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. Mr. Hurley continues to be employed by Benedek Broadcasting
without an employment agreement.

1999 STOCK OPTION PLAN

     The Company's 1999 Stock Option Plan (the "Plan") provides for granting of
stock options to employees, directors, consultants and advisors of the Company
and its subsidiaries. The Plan is intended to encourage stock ownership by
employees, directors, consultants and advisors of the Company and its
subsidiaries and thereby enhance their proprietary interest in the Company.
Subject to the provisions of the Plan, the Board of Directors determines which
of the eligible directors, employees, consultants and advisors receive stock
options, the terms, including applicable vesting periods, of such options, and
the number of shares for which such options are granted.

     The total number of shares of Class B common stock that may be purchased
pursuant to options under the Plan shall not exceed 240,000. The option price
per share with respect to each such option is determined by the Board and
generally is not less than 100% of the fair market value of the Class B common
stock on the date such option is granted as determined by the Board. The Plan
terminates on December 31, 2008, unless terminated earlier by the Board.

                                     - 35 -




<PAGE>


     The following table sets forth certain information concerning the option
grants under the Plan for the Chief Executive Officer and the other five most
highly-compensated executives during the year ended December 31, 1999.

<TABLE>
<CAPTION>
                                                                                  % OF           EXERCISE
                                                             NUMBER OF            1999           PRICE PER
NAME AND PRINCIPAL POSITION                                 OPTIONS (a)          GRANTS          SHARE (b)
---------------------------                                 -----------         -------          ----------
<S>                                                            <C>                 <C>               <C>
A. Richard Benedek, Chairman and
  Chief Executive Officer                                          -                 - %          $   -

K. James Yager, President and Chief Operating
  Officer                                                          -                  -               -

Ronald L. Lindwall, Senior Vice President-
   Finance, Chief Financial Officer, Secretary
   and Treasurer                                               25,000              15.2              15

Terrance F. Hurley, Senior Vice President                      40,000              24.2              15

Raymond P. Maselli, Senior Vice President                      15,000               9.1              15

Raymond J. Schonbak, Senior Vice President                     40,000              24.2              15


--------------
(a)  Stock options were granted on January 1, 1999 with an exercise price of
     $15.00 per share. Options vest in varying increments annually beginning
     January 1, 2000, becoming fully vested on January 1, 2005. The options
     expire on December 31, 2008.

(b)  The fair market value of each option at December 31, 1999 was $6.61 per
     share using the Black-Scholes option-pricing model which was approximately
     the fair market value at the date of the grant. The following assumptions
     were used in the option-pricing model: no dividends will be paid on the
     Class B common stock; a risk-free interest rate of 4.44%; an expected life
     of five years; and an expected price volatility of 43.0%.

</TABLE>

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.

     On January 1, 1998, Mr. K. James Yager, the President, Chief Operating
Officer and a director of the Company, exercised options to purchase 370,000
shares of Class B common stock of the Company for an aggregate exercise price of
$555,000. Mr. Yager borrowed the funds necessary to pay the exercise price from
the Company, which loan is evidenced by a promissory note which bears interest
at the rate of 5.93% per annum, is secured by the shares which were issued upon
exercise of the option and is payable as and when any such shares are sold and
in any event no later than December 31, 2007.

                                     - 36 -




<PAGE>


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

     Mr. A. Richard Benedek, the Chairman and Chief Executive Officer of the
Company, owns 6,467,600 shares of Class B common stock of the Company,
representing 87.4% of its outstanding common stock.

     Mr. Stephen Benedek, the son of Mr. A. Richard Benedek, owns 562,400 shares
of Class B common stock of the Company, representing 7.6% of its outstanding
common stock. Mr. Stephen Benedek became an employee of the Company effective in
November 1999.

     Mr. K. James Yager, the President, Chief Operating Officer and a director
of the Company, owns 370,000 shares of Class B common stock of the Company,
representing 5.0% of its outstanding common stock.

     See "Management's Discussion and Analysis of Financial Condition and
Results of Operations--Liquidity and Capital Resources" for a discussion with
respect to arrangements which may result in a change in control of Benedek
Broadcasting and/or BLC.

ITEM 13.      CERTAIN RELATIONSHIPS AND
              RELATED TRANSACTIONS.

     On January 1, 1998, Mr. K. James Yager, the President, Chief Operating
Officer and a director of the Company, exercised options to purchase 370,000
shares of Class B common stock of the Company for an aggregate exercise price of
$555,000. Mr. Yager borrowed the funds necessary to pay the exercise price from
the Company, which loan is evidenced by a promissory note which bears interest
at the rate of 5.93% per annum, is secured by the shares which were issued upon
exercise of the option and is payable as and when any such shares are sold and
in any event no later than December 31, 2007.

     During June 1998, Mr. A. Richard Benedek, the Chairman, Chief Executive
Officer and a director of the Company, borrowed $65,000 from the Company for
personal purposes. The loan is unsecured, evidenced by a promissory note which
bears interest at the rate of 5.58% per annum and is payable on July 1, 2000.

     During July 1998, Mr. K. James Yager, the President, Chief Operating
Officer and a director of the Company, borrowed $150,000 from the Company for
personal purposes. The loan is unsecured, evidenced by a promissory note which
bears interest at the rate of 5.56% per annum and is payable on July 1, 2000.

     During 1999, Mr. A. Richard Benedek, the Chairman, Chief Executive Officer
and a director of the Company, borrowed a total of $720,000 from the Company in
three separate transactions for personal purposes. The loans are unsecured,
evidenced by promissory notes which bear interest at rates ranging from 4.74% to
5.32% per annum and are payable during 2002. For the year ended December 31,
1999, interest was paid in full on a quarterly basis.

                                     - 37 -




<PAGE>


     In December 1998, the Company agreed with the lenders under its then
existing Credit Agreement that the amounts permitted to be paid as compensation
to Mr. A. Richard Benedek under the Credit Agreement could be paid to him as
loans instead. The Credit Facility also permits such loans. In 2000, the Company
intends to make loans to Mr. Benedek in amounts to be determined within the
limitations set forth in the Credit Facility.

     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, 1999, the
Company paid approximately $0.9 million for legal services to Shack & Siegel,
P.C.

                                     - 38 -




<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, 1998 and 1999................................         F-3
       Consolidated Statements of Operations for the Three Years Ended
          December 31, 1999........................................................................         F-4
       Consolidated Statements of Stockholders' (Deficit) for the Three
          Years Ended December 31, 1999............................................................         F-5
       Consolidated Statements of Cash Flows for the Three Years Ended
          December 31, 1999........................................................................         F-6
       Notes to Consolidated Financial Statements..................................................         F-8

(a)(2) Supplemental Schedule

Benedek Communications Corporation and Subsidiaries
   Independent Auditor's Report....................................................................         S-1
   Schedule II--Valuation and Qualifying Accounts..................................................         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.

                                     - 39 -




<PAGE>


(a)(3) Exhibits.

<TABLE>
<S>           <C>
       3.1    --Certificate of Incorporation of the Registrant, as amended,
                incorporated by reference to Exhibit 3.1 to Benedek
                Communications Corporation'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 Benedek Communications Corporation 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 11
                1/2% Senior Exchangeable Preferred Stock Qualifications,
                Limitations and Restrictions thereof, of Benedek Communications
                Corporation, incorporated by reference to Exhibit 3.3 to Benedek
                Communications Corporation's Registration Statement on Form S-4,
                File No. 333-56367, filed on June 9, 1998 (the "1998 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 of Benedek Communications Corporation,
                incorporated by reference to Exhibit 3.4 to the S-4 Registration
                Statement.

       4.1    --Indenture dated as of May 15, 1996 between Benedek
                Communications Corporations 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 of
                Benedek Communications Corporation (included in Exhibit 4.1
                hereof), incorporated by reference to Exhibit 4.2 to the S-4
                Registration Statement.

       4.3    --Certificate of Designation, Preferences and Relative,
                Participating, Optional and Other Special Rights of 11 1/2%
                Senior Preferred Stock due 2008 and Qualifications, Limitations
                and Restrictions thereof (filed as Exhibit 3.3 hereof),
                incorporated by reference to Exhibit 4.6 to the 1998 S-4
                Registration Statement.

       4.4    --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 of Benedek Communications Corporation
                (filed as Exhibit 3.4 hereof), incorporated by reference to
                Exhibit 4.6 to the S-4 Registration Statement.

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

       4.6    --Form of Exchange Debenture relating to the 11 1/2% Exchange
                Debentures which may be issued, under certain circumstances, in
                exchange for the 11 1/2% Senior Exchangeable Preferred Stock of
                Benedek Communications Corporation incorporated by reference to
                Exhibit 4.9 to the 1998 S-4 Registration Statement.

       10.1   --Purchase Agreement dated May 30, 1996 between Benedek
                Communications Corporation 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 Benedek Communications Corporation 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   --Purchase Agreement dated May 7, 1998 among Benedek
                Communications Corporation, TD Securities (USA) and BT Alex.
                Brown Incorporated, incorporated by reference to Exhibit 10.1 of
                the 1998 S-4 Registration Statement.
</TABLE>

                                     - 40 -




<PAGE>


<TABLE>
<S>           <C>
       10.4   --Exchange and Registration Rights Agreement dated May 7, 1998
                among Benedek Communications Corporation, TD Securities (USA)
                Inc. and BT Alex. Brown Incorporated with respect to the 11 1/2%
                Senior Exchangeable Redeemable Preferred Stock of Benedek
                Communications Corporation, incorporated by reference to Exhibit
                10.2 of the 1998 S-4 Registration Statement.

       10.5   --Warrant Agreement dated as of June 5, 1996 between Benedek
                Communications Corporation and IBJ Schroder Bank & Trust Company
                (filed as Exhibit 4.8 hereof), incorporated by reference to
                Exhibit 10.5 to the S-4 Registration Statement.

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

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

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

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

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

       10.13  --Employment agreement dated as of June 6, 1996 between Benedek
                Broadcasting Corporation and Terrance F. Hurley, incorporated by
                reference to Exhibit 10.20 to the S-4 Registration Statement.

       10.14  --Trust Agreement dated as of September 21, 1998 among Benedek
                Broadcasting Corporation, Benedek License Corporation and Philip
                A. Jones, as trustee, incorporated by reference to Exhibit 10.26
                to Benedek Communications Corporation's Annual Report on Form
                10-K for the fiscal year ended December 31, 1998 (the "1998
                10-K")

       10.15  --Asset Exchange Agreement dated December 30, 1998 between
                Benedek Broadcasting Corporation and Benedek License
                Corporation, and AK Media Group, Inc., incorporated by reference
                to Exhibit 10.27 to the 1998 10-K.

       10.16  --1999 Stock Option Plan of Benedek Communications Corporation,
                incorporated by reference to Exhibit 10.28 to the 1998 10-K.

       10.17  --Time Brokerage Agreement (KKTV (TV)) dated as of December 30,
                1998 between Benedek Broadcasting Corporation and AK Media
                Group, Inc., incorporated by reference to Exhibit 10.29 to the
                1998 10-K.

       10.18  --Time Brokerage Agreement (KCOY-TV) dated as of December 30,
                1998 between Benedek Broadcasting Corporation, Benedek License
                Corporation and AK Media Group, Inc., incorporated by reference
                to Exhibit 10.30 to the 1998 10-K.

       10.19  --Letter Agreement dated January 22, 1999 between AK Media
                Group, Inc. and Benedek Broadcasting Corporation amending the
                Time Brokerage Agreement (KKTV (TV)) dated as of December 30,
                1998, incorporated by reference to Exhibit 10.31 to the 1998
                10-K.

       10.20  --Letter Agreement dated January 22, 1999 between AK Media
                Group, Inc. and Benedek Broadcasting Corporation amending the
                Time Brokerage Agreement (KCOY-TV) dated as of December 30,
                1998, incorporated by reference to Exhibit 10.32 to the 1998
                10-K.

       10.21  --Loan Agreement dated as of May 20, 1999 by and among Benedek
                Communications Corporation, as parent, Benedek Broadcasting
                Corporation, as borrower, the financial institutions signatory
                thereto, as lenders, and Toronto Dominion (Texas), Inc. as
                administrative agent and collateral agent for the lenders, with
                TD Securities (USA) Inc., as lead arranger, incorporated by
                reference to Exhibit 10.1 to Benedek Communications
                Corporation's Quarterly Report on Form 10-Q for the quarter
                ended June 30, 1999 (the "Second Quarter 1999 10-Q").
</TABLE>

                                     - 41 -






<PAGE>


<TABLE>
<S>           <C>
       10.22  --First Amendment to Loan Agreement dated as of June 18, 1999 by
                and among Benedek Communications Corporation, as parent, Benedek
                Broadcasting Corporation, as borrower, the lender (as defined)
                and Toronto Dominion (Texas), Inc., as administrative agent and
                collateral agent, incorporated by reference to Exhibit 10.2 to
                the Second Quarter 1999 10-Q.

       *10.23 --Asset Purchase Agreement dated as of November 17, 1999 between
                The Chronicle Publishing Company and Benedek Broadcasting
                Corporation.

       *10.24 --Escrow Agreement dated as of November 17, 1999 among The
                Chronicle Publishing Company, Benedek Broadcasting Corporation
                and Allfirst Bank, as Escrow Agent.

       *10.25 --Asset Exchange Agreement dated as of December 10, 1999 among
                WGRC, Inc. and Benedek Broadcasting Corporation and Benedek
                License Corporation.

       *10.26 --Assignment and Assumption Agreement dated as of December 10,
                1999 among WGRC, Inc. and Benedek Broadcasting Corporation and
                Benedek License Corporation.

       *10.27 --Guaranty dated as of December 10, 1999 made by LIN Television
                Corporation in favor of Benedek Broadcasting Corporation and
                Benedek License Corporation.

       *10.28 --Asset Purchase Agreement dated as of December 15, 1999 among
                ICA Broadcasting I, Ltd. and Benedek Broadcasting Corporation
                and Benedek License Corporation.

       *10.29 --Unwind Agreement regarding termination of the WMTV Trust and
                the related agreements dated as of February 1, 2000 amount
                Benedek Broadcasting Corporation, Benedek License Corporation,
                the WMTV Trust and WMTV License Co., LLC.

       *21    --Subsidiaries of Benedek Communications Corporation.

       *27    --Financial Data Schedule pursuant to Article 5 of Regulation
                S-X with respect to Benedek Communications Corporation.


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

</TABLE>

(b) Reports on Form 8-K

        None.

                                     - 42 -




<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 29, 2000

     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>
<CAPTION>
SIGNATURE                                CAPACITY IN WHICH SIGNED                         DATE
---------                                ------------------------                         ----
<S>                                      <C>                                              <C>
/s/ A. RICHARD BENEDEK                   Chairman and Chief Executive Officer             March 29, 2000
 .....................................    (Principal Executive Officer) and
A. RICHARD BENEDEK                       Director

/s/ K. JAMES YAGER                       President and Director                           March 29, 2000
 .....................................
K. JAMES YAGER

/s/ RONALD L. LINDWALL                   Senior Vice President-Finance, Chief             March 29, 2000
 .....................................    Financial Officer, Secretary and
RONALD L. LINDWALL                       Treasurer (Principal Financial and
                                         Accounting Officer) and Director

/s/ JAY KRIEGEL                          Director                                         March 29, 2000
 .....................................
JAY KRIEGEL

/s/ PAUL S. GOODMAN                      Director                                         March 29, 2000
 .....................................
PAUL S. GOODMAN
</TABLE>

                                     - 43 -




<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, 1998 and 1999....................................         F-3
   Consolidated Statements of Operations for the Three Years Ended
       December 31, 1999...........................................................................         F-4
   Consolidated Statements of Stockholders' (Deficit) for the Three Years Ended
       December 31, 1999...........................................................................         F-5
   Consolidated Statements of Cash Flows for the Three Years Ended
       December 31, 1999...........................................................................         F-6
   Notes to Consolidated Financial Statements......................................................         F-8
</TABLE>

                                      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, 1998 and 1999 and
the related consolidated statements of operations, stockholders' (deficit) and
cash flows for the years ended December 31, 1997, 1998 and 1999. 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, 1998 and 1999 and
the results of their operations and their cash flows for the years ended
December 31, 1997, 1998 and 1999, in conformity with generally accepted
accounting principles.

                                        /s/ McGLADREY & PULLEN, LLP

Rockford, Illinois
February 18, 2000

                                      F-2





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                            CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                                                       December 31,
                                                                                          --------------------------------------
                                                                                                 1998                  1999
                                                                                                 ----                  ----
                                         ASSETS                                                         (In thousands)

<S>                                                                                        <C>                   <C>
Current Assets
   Cash and cash equivalents............................................................         $    4,291            $   3,278
   Receivables
      Trade, less allowance for doubtful accounts of $480 and
         $683 for 1998 and 1999.........................................................             25,984               27,619
      Notes receivable-officers.........................................................                  -                  275
      Other.............................................................................              1,114                  983
   Current portion of program broadcast rights..........................................              4,878                5,844
   Prepaid expenses.....................................................................              1,623                1,979
   Deferred income taxes................................................................              1,191                1,085
                                                                                          ---------------------------------------
             TOTAL CURRENT ASSETS.......................................................             39,081               41,063
                                                                                          ---------------------------------------

Property and equipment (Note D).........................................................             62,627               62,782
                                                                                          ---------------------------------------
Intangible assets (Note E)..............................................................            335,634              335,348
                                                                                          ---------------------------------------
Other assets

   Program broadcast rights, less current portion (Note H)..............................              1,198                1,270
   Deferred loan costs..................................................................              8,475                6,060
   Deposit on and costs of acquisitions.................................................                  -               10,294
   Notes receivable-officers............................................................                275                  720
   Other................................................................................                172                  239
                                                                                          ---------------------------------------
                                                                                                     10,120               18,583
                                                                                          ---------------------------------------
                                                                                                $   447,462           $  457,776
                                                                                          ---------------------------------------
                                                                                          ---------------------------------------
                        LIABILITIES AND STOCKHOLDERS' (DEFICIT)

Current Liabilities
   Current maturities of notes payable..................................................        $    15,911            $   1,300
   Current portion of program broadcast liabilities.....................................              6,994                8,608
   Accounts payable and accrued expenses (Note I).......................................             11,977               10,169
   Deferred revenue.....................................................................                644                  579
                                                                                          ---------------------------------------
             TOTAL CURRENT LIABILITIES..................................................             35,526               20,656
                                                                                          ---------------------------------------

Long-Term Obligations
   Notes payable (Note F, G)............................................................            358,905              426,279
   Program broadcast liabilities (Note H)...............................................                891                  978
   Deferred revenue.....................................................................              2,994                2,435
   Deferred income taxes (Note K).......................................................             33,765               23,291
                                                                                          ---------------------------------------
                                                                                                    396,555              452,983
                                                                                          ---------------------------------------
Exchangeable redeemable senior preferred stock, liquidation
   preference, 1998-$106,579 1999-$119,251 (Note F).....................................            107,596              122,092
                                                                                          ---------------------------------------
Seller junior discount preferred stock (Note F).........................................             55,048               59,539
                                                                                          ---------------------------------------
Commitments (Note B, H, J)

Stockholders' (Deficit) (Note C, F, L)
   Common stock, Class A................................................................                  -                    -
   Common stock, Class B................................................................                 74                   74
   Additional paid-in capital...........................................................            (59,549)             (64,296)
   Accumulated deficit..................................................................            (87,200)            (132,651)
   Stockholder's note receivable (Note C)...............................................               (588)                (621)
                                                                                          ---------------------------------------
                                                                                                   (147,263)            (197,494)
                                                                                          ---------------------------------------
                                                                                                $   447,462           $  457,776
                                                                                          =======================================
</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,
                                                                      -----------------------------------------------------------
                                                                            1997                 1998                 1999
                                                                           (In thousands, except share and per share data)

<S>                                                                     <C>                  <C>                  <C>
Net revenues..................................................              $  127,073           $  139,833           $  140,406
                                                                      -----------------    -----------------    -----------------

Operating expenses:
   Selling, technical and program expenses....................                  60,385               64,651               66,793
   General and administrative.................................                  19,618               20,858               19,801
   Depreciation and amortization..............................                  31,380               30,830               28,520
   Corporate..................................................                   3,787                4,643                4,510
                                                                      -----------------    -----------------    -----------------
                                                                               115,170              120,982              119,624
                                                                      -----------------    -----------------    -----------------

Net gain on sale of stations (Note B).........................                       -                    -                6,181
                                                                      -----------------    -----------------    -----------------

            Operating income..................................                  11,903               18,851               26,963
                                                                      -----------------    -----------------    -----------------

Financial income (expense):
   Interest expense:  (Note A)
       Cash interest..........................................                 (28,996)             (26,979)             (25,285)
       Other interest.........................................                 (19,374)             (17,043)             (19,040)
                                                                      -----------------    -----------------    -----------------
                                                                               (48,370)             (44,022)             (44,325)

   Interest income............................................                     130                  494                  208
                                                                      -----------------    -----------------    -----------------
                                                                               (48,240)             (43,528)             (44,117)

   (Loss) before income tax benefit and extraordinary item....                 (36,337)             (24,677)             (17,154)

Income tax benefit (Note K)...................................                  12,027                8,052                1,377
                                                                      -----------------    -----------------    -----------------
   (Loss) before extraordinary item...........................                 (24,310)             (16,625)             (15,777)

Extraordinary item, loss on early extinguishment of debt less
   applicable income taxes of $8,340 (Note G).................                       -                    -              (12,510)
                                                                      -----------------    -----------------    -----------------
Net (loss)....................................................                 (24,310)             (16,625)             (28,287)

Preferred stock dividends and accretion.......................                 (19,037)             (30,855)             (18,987)
                                                                      -----------------    -----------------    -----------------

Net (loss) applicable to common stock.........................              $  (43,347)          $  (47,480)           $ (47,274)
                                                                      =================    =================    =================

Basic and diluted (loss) per common share:

   (Loss) before extraordinary item...........................               $   (6.17)           $   (6.42)           $   (4.70)
   Extraordinary item.........................................                       -                    -                (1.69)
                                                                      -----------------    -----------------    -----------------
   (Loss) per common share....................................               $   (6.17)           $   (6.42)           $   (6.39)
                                                                      =================    =================    =================

Weighted-average common shares outstanding                                   7,030,000            7,400,000            7,400,000
                                                                      =================    =================    =================

</TABLE>

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


                                      F-4




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT)
                    YEARS ENDED DECEMBER 31, 1997, 1998 AND 1999

<TABLE>
<CAPTION>
                                                         Additional                            Stockholder's
                                           Common          Paid-In         Accumulated             Note
                                           Stock           Capital           Deficit            Receivable             Total
                                         -----------    --------------    ---------------     ----------------    ----------------
                                                                              (In thousands)

<S>                                      <C>            <C>               <C>                 <C>                <C>
  Balance at December 31, 1996                $  70        $ (35,347)        $  (16,284)              $     -          $ (51,561)
     Accretion to exchangeable
       redeemable senior preferred
       stock (Note F)...............              -           (4,845)                  -                    -             (4,845)
     Dividends on preferred stock...              -                 -           (14,192)                    -            (14,192)
     Net (loss).....................              -                 -           (24,310)                    -            (24,310)
                                         -----------    -------------     --------------      ----------------    ---------------
  Balance at December 31, 1997                $  70        $ (40,192)        $  (54,786)              $     -          $ (94,908)
     Accretion to exchangeable
       redeemable senior
       preferred stock (Note F).....              -          (15,067)                  -                    -            (15,067)
     Dividends on preferred stock                 -                 -           (15,789)                    -            (15,789)
     Financial costs related to the
       sale of preferred stock......              -           (4,339)                  -                    -             (4,339)
     Repurchase and retirement of
       initial warrants.............              -             (535)                  -                    -               (535)
     Stock options exercised in
       exchange for stockholder note
       receivable (Note C)..........              4               551                  -                (555)                   -
     Accrued interest on note
       receivable...................              -                33                  -                 (33)                   -
     Net (loss).....................              -                 -           (16,625)                    -            (16,625)
                                         -----------    -------------     --------------      ----------------    ---------------
  Balance at December 31, 1998                $  74        $ (59,549)        $  (87,200)           $    (588)         $ (147,263)
     Accretion to exchangeable
       redeemable senior
       preferred stock (Note F).....              -           (1,823)                  -                    -             (1,823)
     Dividends on preferred stock                 -                 -           (17,164)                    -            (17,164)
     Purchase and retirement of
       warrants.....................              -           (2,957)                  -                    -             (2,957)
     Accrued interest on note
       receivable...................              -                33                  -                 (33)                   -
     Net (loss).....................              -                 -           (28,287)                    -            (28,287)
                                         -----------    -------------     --------------      ----------------    ---------------
  Balance at December 31, 1999......          $  74        $ (64,296)        $ (132,651)           $    (621)         $ (197,494)
                                         ===========    =============     ==============      ================    ===============

</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,
                                                                                -------------------------------------------------
                                                                                    1997              1998             1999
                                                                                    ----              ----             ----
                                                                                                 (In thousands)

<S>                                                                                 <C>              <C>               <C>
Cash flows from operating activities
   Net (loss)..............................................................         $ (24,310)        $(16,625)         $(28,287)
      Adjustments to reconcile net (loss) to net cash provided
         by operating activities:
         Amortization of program broadcast rights..........................             6,401            6,758             8,127
         Depreciation and amortization.....................................            20,971           21,178            15,695
         Amortization and write-off of intangibles and deferred loan costs.            15,779           11,657            14,609
         Amortization of note discount.....................................            13,275           15,090            17,227
         Deferred income taxes.............................................           (12,376)          (8,317)          (10,368)
         Net gain on sale of stations......................................                 -                -            (6,181)
         Loss on early extinguishments of debt.............................                 -                -            20,850
         Other.............................................................               610                -                 -
   Changes in operating assets and liabilities, net of effects of acquisitions:
         Receivables.......................................................            (2,603)            (400)           (1,504)
         Due to sellers....................................................              (153)               -                 -
         Prepaid expenses and other........................................              (206)              36              (356)
         Payments on program broadcast liabilities.........................            (5,937)          (6,399)           (7,455)
         Accounts payable and accrued expenses.............................            (2,281)          (2,157)           (2,482)
         Deferred revenue..................................................              (699)            (805)             (573)
                                                                                --------------    -------------    --------------
           Net cash provided by operating activities.......................             8,471           20,016            19,302
                                                                                --------------    -------------    --------------

Cash flows from investing activities
   Purchase of property and equipment......................................            (6,174)          (6,295)           (7,923)
   Payment for acquisition of stations.....................................                 -                -            (9,359)
   Deposit on and costs of acquisitions....................................                 -                -           (10,294)
   Disbursements on notes receivable-officers..............................                 -             (240)             (720)
   Purchase of intangibles.................................................                 -             (199)                -
   Other, net..............................................................              (108)             152                 5
                                                                                --------------    -------------    --------------
           Net cash (used in) investing activities.........................            (6,282)          (6,582)          (28,291)
                                                                                --------------    -------------    --------------

Cash flows from financing activities
   Principal payments on notes payable.....................................           (14,864)          (4,134)         (262,044)
   Proceeds from issuance of preferred stock...............................                 -          100,000                 -
   Net (payments) borrowings on long-term revolver.........................            10,000          (10,000)           58,500
   Proceeds from long-term borrowing.......................................                 -                -           220,000
   Redemption of senior preferred stock....................................                 -          (92,768)                -
   Purchase of initial warrants............................................                 -             (535)           (2,957)
   Payment of debt and preferred stock acquisition costs...................            (2,768)          (4,354)           (5,523)
                                                                                --------------    -------------    --------------
           Net cash provided by (used in) financing activities.............            (7,632)         (11,791)            7,976
                                                                                --------------    -------------    --------------
           Increase (decrease) in cash and cash equivalents................            (5,443)           1,643            (1,013)
Cash and cash equivalents:
     Beginning.............................................................             8,091            2,648             4,291
                                                                                --------------    -------------    --------------
     Ending................................................................           $ 2,648          $ 4,291            $3,278
                                                                                ==============    =============    ==============
</TABLE>

                                                          (Continued)

                                      F-6




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF CASH FLOWS-(CONTINUED)

<TABLE>
<CAPTION>
                                                                                            Years Ended December 31,
                                                                                 ------------------------------------------------
                                                                                     1997             1998             1999
                                                                                     ----             ----             ----
                                                                                                (In thousands)

<S>                                                                              <C>             <C>               <C>
Supplemental Disclosure of Cash Flow Information:
  Cash payments for interest................................................          $30,489         $ 27,055          $ 30,307
  Cash payments for income taxes............................................              432              152               679
                                                                                 =============    =============    ==============

Supplemental Schedule of Noncash Investing and Financing Activities:
  Acquisition of program broadcast rights...................................          $ 6,340         $  6,169          $  8,186
  Purchase of equipment on accounts payable.................................                -                -               500
  Notes payable incurred for purchase of property and equipment.............            4,271            2,943             4,140
  Equipment acquired by barter transactions.................................              388              909               221
  Dividends accrued on redeemable preferred stock...........................           14,192           15,789            17,164
  Stock option exercised in exchange for note receivable....................                -              555                 -
  Accrued interest on note receivable stockholder added to
     additional paid-in capital.............................................                -               33                33
  Accretion to exchangeable redeemable senior preferred stock...............            4,845           15,067             1,823
                                                                                 =============    =============    ==============

Acquisition of station:
  Property and equipment acquired at fair market value......................          $     -         $      -          $  6,238
  Intangible assets acquired ...............................................                -                -            27,376
  Program broadcast rights acquired.........................................                -                -             1,115
  Program broadcast liabilities assumed.....................................                                              (1,115)
  Other, net................................................................                -                -                17
                                                                                 -------------    -------------    --------------
                                                                                            -                -            33,631
  Less:  Fair value of assets swapped.......................................                -                -           (24,272)
                                                                                 -------------    -------------    --------------
  Cash purchase price, including fees paid..................................          $     -         $      -          $  9,359
                                                                                 =============    =============    ==============

Sale of stations:
  Property equipment sold...................................................          $     -         $      -          $  3,076
  Intangible assets sold....................................................                -                -             8,101
  Program broadcast rights sold.............................................                -                -               136
  Program broadcast liabilities transferred.................................                -                -              (145)
                                                                                 -------------    -------------    --------------
                                                                                            -                             11,168
  Gain recognized on sale of stations.......................................                -                -            13,101
                                                                                 -------------    -------------    --------------
                                                                                                                          24,269

  Less:  Fair value of assets swapped.......................................                -                -           (24,272)
  Fees on sales paid in 1998................................................                -                -                59
                                                                                 -------------    -------------    --------------
  Proceeds from sale of station net of fees paid............................          $     -         $      -          $     56
                                                                                 =============    =============    ==============


</TABLE>






   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") is a holding company
with minimal operations other than from its wholly-owned subsidiary, Benedek
Broadcasting Corporation ("Benedek Broadcasting"). Benedek Broadcasting owns and
operates twenty-three television stations (the "Stations") located throughout
the United States. The operating revenues of the Stations 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. 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. Segment information is not
presented since all of the Company's revenue is attributed to a single
reportable segment.

BASIS OF PRESENTATION

     The consolidated financial statements of the Company include the accounts
of the Company and its wholly-owned subsidiary, Benedek Broadcasting and its
wholly-owned subsidiaries, Benedek License Corporation ("BLC"), Benedek Cable,
Inc. ("BCI"), Benedek Interactive Media, Inc. and the WMTV Trust and its
subsidiary, WMTV License Co., LLC ("WMTV LLC"). All significant intercompany
items and transactions have been eliminated in consolidation.

     During 1998, BCI was formed as the entity through which Benedek
Broadcasting delivers The Warner Bros. Television Network programming to local
cable companies in 15 of its 20 markets ranked above 100 as measured by Nielsen
surveys. BCI holds minimal assets and had insignificant operations in 1998 and
1999.

     During October 1998, in order to comply with certain FCC duopoly rules,
Benedek Broadcasting transferred all assets and liabilities related to WMTV-TV,
serving Madison, Wisconsin, to the WMTV Trust, a disposition trust, and BLC
transferred the related FCC license to WMTV LLC. Since Benedek Broadcasting is
the sole beneficiary of this grantor trust, the assets, liabilities and results
of operations from this trust are included in the consolidated financial
statements of the Company. Due to changes in FCC duopoly rules, the WMTV Trust
and its subsidiary WMTV LLC were dissolved subsequent to December 31, 1999 and
all assets and liabilities related to them were transferred to Benedek
Broadcasting and BLC.

     Benedek Interactive Media, Inc. was formed in December 1999 and has minimal
assets and had no operations in 1999.

                                      F-8





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)



SIGNIFICANT ACCOUNTING POLICIES

(1)  Accounting estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the 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.

     Deferred revenues primarily relate to compensation due from the network and
national sales representatives at the inception of the network affiliation and
the national sales representative agreements, respectively. These revenues are
recognized over the life of the agreements 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.


                                      F-9




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

(6)  Deferred loan and acquisition costs

     Deferred loan costs are amounts incurred in connection with long-term
financing. The costs are amortized on the interest 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 issuances of
preferred stock are included in stockholders' 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 in 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.

(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:

<TABLE>
<CAPTION>
                                                                  Years
                                                                  -----
<S>                                                             <C>
           Buildings and improvements........................      5-40
           Towers............................................      5-12
           Transmission equipment............................      3-10
           Other equipment...................................       1-5

</TABLE>

     Gains and losses on the disposition of property and equipment are
insignificant and are 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 its 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 or discount the future cash flows
to determine fair value, and adjust the carrying value of the assets to the
estimated fair value if the fair value is less than the carrying value (Note E).

(8)  Other interest expense

     Other interest expense includes accrued interest added to long-term debt
balances, deferred loan cost amortization and write offs (except deferred loan
cost write offs related to extraordinary debt extinguishments), financing costs
not consummated, and accretion of discounts.


                                      F-10




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

(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.

     The Company and its subsidiaries file a consolidated federal income tax
return.

(10)  Employee Benefits

     The Company has defined contribution plans 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.

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

(11)  Earnings (loss) per common share

     Basic per-share amounts are computed by dividing net income adjusted for
preferred stock dividends declared and accretion (the numerator) by the
weighted-average number of common shares outstanding (the denominator). Diluted
per-share amounts assume the conversion, exercise or issuance of all potential
common stock instruments unless the effect is to reduce the loss or increase the
income per common share from continuing operations. The Company has no present
dilutive per share amounts, since the inclusion of the Initial Warrants (as
defined) and stock options would have been anti-dilutive for the periods
presented.

(12)  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.

(13)  Reclassifications

Certain amounts in the consolidated financial statements for the years ended
December 31, 1997 and 1998 have been reclassified to conform with the
classification adopted for the year ended December 31, 1999. These
reclassifications had no effect on the 1997 or 1998 net loss.


                                      F-11





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)


(NOTE B) - ACQUISITION, SALE OF STATIONS AND PENDING PURCHASE

     On December 30, 1998, the Company entered into an Asset Exchange Agreement
with The Ackerley Group, Inc. ("Ackerley") pursuant to which the Company
exchanged the television broadcast assets of KCOY-TV, in Santa Maria, California
("KCOY-TV"), for the television broadcast assets of KKTV, Ackerley's station in
Colorado Springs, Colorado ("KKTV"). Both KCOY-TV and KKTV are CBS affiliates.
The exchange was completed on May 1, 1999, upon which the Company paid
$9,000,000 to Ackerley as further consideration in accordance with the
agreement.

     The exchange was recorded as a separate sale and acquisition of stations,
with the acquisition of KKTV accounted for under the purchase method of
accounting. Accordingly, the results of the operations for KKTV are included in
the Company's consolidated financial statements since the date of acquisition,
May 1, 1999. In addition, the parties entered into a time brokerage agreement
for each station, in effect from January 1, 1999 until April 30, 1999. During
the time brokerage period, the revenue and expenses of each station went to the
account of the buyer, net of applicable time brokerage fees. The net time
brokerage fee expense was $508,000 for the year ended December 31, 1999.

     The total purchase price for KKTV was approximately $33,631,000 which
consisted of the fair market value of KCOY-TV assets of $24,272,000, cash
payment of $9,000,000, and fees of $359,000. The purchase price has been
allocated to 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 the acquisition is being amortized on the straight-line method
over a period of 40 years.

     The unaudited pro forma results of operations and earnings per share for
the years ended December 31, 1998 and 1999, assuming only the acquisition of
KKTV, and assuming both the acquisition of KKTV and disposition of KCOY-TV, had
occurred on January 1, 1998 and 1999, are presented in the table below. The 1998
pro forma adjustments for the disposition of KCOY-TV eliminate the revenues and
operating expenses of KCOY-TV as of January 1, 1998 but do not give any pro
forma effect to the gain on disposition which is reported in 1999.

<TABLE>
<CAPTION>
                                                                              Acquisition of KKTV and
                                        Acquisition of KKTV Only              Disposition of KCOY-TV
                                     --------------------------------     --------------------------------
                                         1998              1999               1998              1999
                                         ----              ----               ----              ----
                                                   (In thousands, except per share data)

<S>                                   <C>               <C>                <C>              <C>
Net revenue........................   $   149,760       $   140,406        $   144,209       $   139,613
                                     --------------    --------------     --------------    --------------
(Loss) before extraordinary
       item........................       (16,480)          (15,697)           (16,542)          (15,913)
Extraordinary item.................             -           (12,510)                 -           (12,510)
                                     --------------    --------------     --------------    --------------
Net (loss).........................   $   (16,480)      $   (28,207)       $   (16,542)      $   (28,423)
                                     ==============    ==============     ==============    ==============
Basic and diluted (loss) per
   common share ...................
   (Loss) before extraordinary
       item........................   $     (6.40)      $     (4.69)       $     (6.41)      $     (4.72)
   Extraordinary item..............             -             (1.69)                 -             (1.69)
                                     --------------    --------------     --------------    --------------
   (Loss) per common share.........   $     (6.40)      $     (6.38)       $     (6.41)      $     (6.41)
                                     ==============    ==============     ==============    ==============
</TABLE>


                                      F-12




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     The pro forma amounts include certain adjustments to reflect interest
expense, amortization of intangibles and income taxes. The pro forma information
does not necessarily reflect the actual results that would have occurred nor is
it necessarily indicative of future results of the operations of the stations.

     A gain of approximately $13,323,000 was recorded to reflect the sale of
KCOY-TV. This gain consisted of the fair market value of KCOY-TV assets of
$24,272,000 less their book value of $10,732,000 and fees of $217,000.

     During September 1999, a loss in the amount of approximately $222,000 was
recorded to reflect the sale of KTVS-TV, Sterling, Colorado ("KTVS-TV") which
was a satellite operation of KGWN-TV Cheyenne, Wyoming ("KGWN-TV"). The Company
sold KTVS-TV since KTVS-TV is outside of the KGWN-TV designated market area.

PENDING PURCHASE AND SALE OF STATIONS

     On November 19, 1999, the Company entered into an Asset Purchase Agreement
with The Chronicle Publishing Company ("Chronicle") and on December 10, 1999,
the Company entered into an Asset Exchange Agreement with WGRC, Inc. ("WGRC").
Pursuant to these agreements, WGRC will acquire the television broadcast assets
of WOWT-TV and KAKE-TV, Chronicle's television stations in Omaha, Nebraska and
Wichita, Kansas, respectively, and then immediately transfer the same to the
Company in exchange for the television broadcast assets of WWLP-TV, the
Company's station in Springfield, Massachusetts. The proposed transaction will
include an $18,000,000 payment by the Company to WGRC. At December 31, 1999, the
Company had deposited $10,000,000 in an escrow account related to this
transaction. The remaining $8,000,000 will be funded from the proceeds related
to the sale of KOSA-TV discussed below. The transaction will be structured, to
the extent feasible, as a tax-free exchange pursuant to Section 1031 of the
Internal Revenue Code and accounted for under the purchase method of accounting
in accordance with APB Opinion No. 16.

     On December 15, 1999, the Company entered into an Asset Purchase Agreement
with ICA Broadcasting I, Ltd. ("ICA") pursuant to which the Company will sell
the television broadcast assets of KOSA-TV, in Odessa, Texas to ICA for a cash
payment of $8,000,000. Accordingly, the Company recorded a lower of cost or
market adjustment of approximately $6,920,000 in 1999 to write down the assets
of KOSA-TV to the sales price less estimated selling costs. This loss is
included in "net gain on sale of stations" in the consolidated statement of
operations.

     The assets of WWLP-TV and KOSA-TV which are held for sale or to be
exchanged and their corresponding carrying values as of December 31, 1999 are as
follows:

<TABLE>
<CAPTION>
                                                                  WWLP-TV           KOSA-TV
                                                             ---------------    --------------
                                                                      (In thousands)

<S>                                                           <C>               <C>
Property and equipment...............................              $  6,728          $  1,586
Intangible assets....................................                54,520             6,174
                                                             ---------------    --------------
                                                                   $ 61,248          $  7,760
                                                             ===============    ==============
</TABLE>

     Both of the above transactions remain subject to FCC approval. It is
anticipated that both transactions will be completed in the first quarter of
2000.


                                      F-13




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)



(NOTE C) - RELATED PARTY TRANSACTIONS AND 1999 STOCK OPTION PLAN

STOCK OPTION AGREEMENTS

     In 1998, a key employee exercised all outstanding options granted to him
under a stock-based compensation plan for the employee. A total of 370,000
options had been outstanding and exercisable throughout 1997 and were all
exercised in 1998 at a price of $1.50 per share, which was reduced in 1998 from
$3.22 per share based on an independent appraisal. The Company loaned the key
employee the funds necessary to pay for the shares under a note which bears
interest at 5.93% and is due on December 31, 2007. This recourse note, which is
a personal obligation of the employee, is collateralized by the stock which was
issued upon exercise of the option, and is classified as a contra equity account
in the accompanying consolidated balance sheet.

     In December 1998, the Company's Board of Directors (the "Board") adopted
the 1999 Stock Option Plan (the "Plan") whereby from time to time on or before
December 31, 2008, options to purchase shares of Class B common stock may be
granted to employees, directors or consultants and advisors of the Company and
its subsidiaries. The aggregate number of shares of common stock which may be
purchased pursuant to options granted at any time under the Plan shall not
exceed 240,000. The purchase price per share shall be the fair market value, as
defined by the Plan, or an amount determined by the Board. If options are
granted to an employee who, at the time of the grant, owns more than ten percent
of the voting stock of the Company, the purchase price per share shall be at
least one hundred and ten percent of the fair market value, as defined by the
Plan. The vesting period of options granted under the Plan are determined by the
Board. The maximum term options may be outstanding under the plan is ten years.
A total of 165,000 options were granted during 1999 at an exercise price of
$15.00 per share, the grant date fair value, which vest in varying increments
annually starting on January 1, 2000, becoming fully vested on January 1, 2005.
No options were exercised, forfeited, or expired during 1999, thus the 165,000
options were outstanding and none were exercisable at December 31, 1999. The
remaining contractual life of the 165,000 options is nine years.

     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 prescribed in FASB Statement No. 123, the reported net (loss)
and basic and diluted (loss) per common share for the year ended December 31,
1999 would have been $(28,395) and $(6.40), respectively. In determining the pro
forma amounts, the fair value per share for each option was estimated to be
$6.61 at the grant date by using the Black-Scholes option-pricing model with the
following assumptions: no dividends will be paid on the Class B common stock; a
risk-free interest rate of 4.44%; an expected life of five years; and an
expected price volatility of 43.0%. In 1998 and 1997 there would have been no
effect on the reported net (loss) and basic and diluted (loss) per common share
determined by the fair value method.

DIRECTOR FEES

     The Company paid fees of approximately $222,000, $601,000 and $871,000
during the years ended December 31, 1997, 1998 and 1999, respectively, to the
law firm of Shack & Siegel, P.C., a partner of which serves as a director to the
Company.


                                      F-14





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)



NOTES RECEIVABLE-OFFICERS

     During 1998 and 1999 the Company issued loans to various officers of the
Company for which the total amounts receivable as of December 31, 1998 and 1999
were $275,000 and $995,000, respectively. These notes bear interest at rates
ranging from 4.74% to 5.58% and have due dates ranging from July 1, 2000 to
September 1, 2002. These notes are personal obligations of the applicable
officer and have been issued with recourse.

(NOTE D) - PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
                                                                    December 31,
                                                            -----------------------------
                                                               1998             1999
                                                               ----             ----
                                                                   (In thousands)

<S>                                                         <C>              <C>
Land and improvements................................        $    5,823       $    6,741
Buildings and improvements...........................            28,152           33,498
Towers...............................................            15,163           16,199
Transmission and studio equipment....................            75,615           77,512
Office equipment.....................................             9,298           10,269
Transportation equipment.............................             2,988            3,296
Construction in progress.............................             2,434            3,457
                                                            ------------     ------------
                                                                139,473          150,972

Less accumulated depreciation and amortization.......            76,846           88,190
                                                            ------------     ------------
                                                             $   62,627       $   62,782
                                                            ============     ============
</TABLE>

 (NOTE E) - INTANGIBLE ASSETS

     Intangible assets consist of the following:

<TABLE>
<CAPTION>
                                                                   December 31,
                                                          -------------------------------
                                                              1998              1999
                                                              ----              ----
                                                                  (In thousands)

<S>                                                        <C>              <C>
Goodwill.............................................         $ 159,057        $ 148,944
FCC licenses.........................................           117,330          127,313
Network affiliations.................................            58,206           58,348
Other................................................             1,041              743
                                                          --------------    -------------
                                                              $ 335,634        $ 335,348
                                                          ==============    =============
</TABLE>


                                      F-15





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     Intangible assets are recorded net of accumulated amortization of
$39,273,000 and $58,791,000 as of December 31, 1998 and 1999, respectively. In
addition to the $6,920,000 lower of cost or market adjustment on KOSA-TV as
discussed in (Note B), during 1999 the Company also wrote down certain stations'
goodwill and FCC licenses which were determined to have been impaired based on
the Company's estimate of fair value using discounted future cash flows. The
write down of approximately $2,762,000 is included in depreciation and
amortization on the consolidated statement of operations.

(NOTE F) - REDEEMABLE EQUITY SECURITIES AND DISCOUNT NOTES

SENIOR PREFERRED STOCK

     In 1996, the Company sold 60,000 Units in a private placement, which
generated proceeds of $60,000,000. Each Unit consisted of (i) ten shares of 15%
Exchangeable Redeemable Senior Preferred Stock due 2007 (the "Original Senior
Preferred Stock"), (ii) ten initial warrants to purchase Class A common stock of
the Company with an expiration date of July 1, 2007 (the "Initial Warrants"),
and (iii) 14.8 contingent warrants to purchase Class A common stock of the
Company.

     The Original Senior Preferred Stock and the contingent warrants were
redeemed in June 1998 from the proceeds of the Company's May 14, 1998 issuance
of 100,000 shares of 11.5% Exchangeable Senior Preferred Stock (the "Senior
Preferred Stock"), with an initial liquidation preference equal to proceeds
received of $100,000,000.

     The Company used approximately $92,800,000 of the net proceeds from the
issuance of the Senior Preferred Stock to redeem the Original Senior Preferred
Stock (including approximately $12,100,000 representing premiums relating to the
redemption). The balance of the proceeds were used to pay fees related to the
transaction and for general corporate purposes, including the reduction of a
portion of Benedek Broadcasting's Revolving Credit Facility (hereinafter
defined).

     Dividends on the Senior Preferred Stock are cumulative and payable
quarterly commencing August 15, 1998 at a rate of 11.5% of the then effective
liquidation preference per share. The Company, at its option, may pay dividends
on any dividend payment date occurring on or before May 15, 2003 either in cash
or by adding such dividends to the then effective liquidation preference. The
Company has been adding the dividends to the liquidation preference from
issuance date through December 31, 1999. The Senior Preferred Stock is not
redeemable until May 15, 2003 at which time cash dividends are required at a
rate of 11.5% of the then effective liquidation preference per share.
Thereafter, the Company has the option to redeem these shares in whole or in
part at predetermined redemption prices. The Senior Preferred Stock contains
various restrictive covenants relating to limitations on dividends, transactions
with affiliates, further issuance of debt, and the sales of assets, among other
things. Notwithstanding the foregoing, until May 15, 2001, in the event of a
public equity offering, a Required Disposition (as defined) or other specified
circumstances, the Company may redeem up to 25.0% of the initial liquidation
preference at 111.50% of the then effective liquidation preference, provided at
least $75,000,000 in liquidation preference remains outstanding.


                                      F-16




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     Since it is management's intention to redeem the Senior Preferred Stock
prior to being required to pay cash dividends, the amount of the redemption
premium payable at such time is being accreted as a constructive distribution
from May 14, 1998 to May 15, 2003. The Senior Preferred Stock is exchangeable
into debentures at the Company's option, subject to certain conditions, in whole
on any scheduled dividend payment date. The Senior Preferred Stock was exchanged
for Senior Preferred Stock registered with the Securities and Exchange
Commission pursuant to a registration statement declared effective on June 15,
1998.

JUNIOR PREFERRED STOCK

     In 1996, the Company issued 450,000 shares of Seller Junior Discount
Preferred Stock due July 1, 2008 (the "Junior Preferred Stock") with an
aggregate liquidation preference equal to the proceeds of $45,000,000. Dividends
are payable to the holders of the Junior Preferred Stock at 7.92% per annum,
cumulative until the fifth anniversary of the issuance thereof and thereafter at
increasing rates up to 18%. Since the Company intends to redeem the Junior
Preferred Stock prior to the fifth anniversary, dividends are being accrued at
the initial rate. The dividends on the Junior Preferred Stock are cumulative.
Prior to June 5, 2001, dividend payments on the Junior Preferred Stock are not
permitted to 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 Junior 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.

     The following table summarizes these activities from December 31, 1997
through December 31, 1999 as follows:

<TABLE>
<CAPTION>
                                                                 Senior            Junior
                                                                Preferred         Preferred
                                                                  Stock             Stock
                                                              --------------    --------------
                                                                      (In thousands)

<S>                                                            <C>               <C>
Balance at December 31, 1997............................           $ 73,660          $ 50,896
    Accrued dividends...................................             11,637             4,152
    Accretion of initial discount and redemption prepayment
       premium..........................................             15,067                 -
    Issuance of Senior Preferred Stock..................            100,000                 -
    Redemption of Original Senior Preferred Stock.......            (92,768)                -
                                                              --------------    --------------
Balance at December 31, 1998............................            107,596            55,048
    Accrued dividends...................................             12,673             4,491
    Accretion of redemption prepayment premium..........              1,823                 -
                                                              --------------    --------------
Balance at December 31, 1999............................           $122,092          $ 59,539
                                                              ==============    ==============
</TABLE>



                                      F-17




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

INITIAL WARRANTS

     At December 31, 1998 and 1999, there were 550,000 and 365,000 of
outstanding Initial Warrants, respectively, which expire July 1, 2007. Each
Initial Warrant entitles the holder thereof to purchase one share of Class A
common stock at an exercise price of $0.01 per share. The value of the Initial
Warrants at the date of issuance was $9,000,000 which was allocated to paid-in
capital. During October 1998 and September 1999, the Company redeemed 50,000 and
185,000 of the outstanding Initial Warrants for $535,000 and $2,957,000,
respectively.

DISCOUNT NOTES

     In June 1996, the Company issued Senior Subordinated Discount Notes due
2006 (the "Discount Notes") in the principal amount of $170,000,000. These
Discount Notes were issued at a discount of $79,822,000 which generated gross
proceeds of $90,178,000. The Discount 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 Discount Notes are
redeemable at the option of the Company, in whole or in part, at predetermined
redemption prices and under specified conditions. The Discount Notes are
subordinated to all other senior debt of the Company. The Discount Notes contain
various restrictive covenants. The Discount Notes were exchanged for Discount
Notes registered with the Securities and Exchange Commission pursuant to a
registration statement declared effective in October 1996. See (Note G) for
amount outstanding on the Discount Notes at December 31, 1998 and 1999.

     During July 1999, the Company retired a portion of its Discount Notes with
a face amount of $3,000,000. The Discount Notes had an accreted value of
$2,371,000 and were purchased for a total of $2,591,000 which includes a premium
payment for early retirement. The premium payment, totaling $220,000, is
included in other interest expense.

     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 Discount Notes, (ii) redemption of and cash
dividends on the Senior Preferred Stock, and (iii) redemption of and cash
dividends on the Junior Preferred Stock 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 legal
obligation, contingent or otherwise, to pay any amount 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, PLEDGED ASSETS AND LOSS ON
EXTINGUISHMENT OF DEBT

(1)    NOTES PAYABLE

TERM LOANS AND REVOLVER

     During 1996, Benedek Broadcasting entered into a credit agreement which
included two term loan facilities in an initial aggregate principal amount of
$128,000,000. This agreement was amended and restated on December 17, 1997 to
convert the existing term loans to new term loans, to amend and delete certain
provisions of the agreement and to replace certain parties to the agreement.
Associated with this amendment and change in lead banks, fees of $3,631,000 were
written off to other interest expense in 1997.

                                      F-18





<PAGE>


                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     On May 20, 1999, the Company borrowed $275,000,000 against a new credit
facility (the "Credit Facility"), which was amended as of June 18, 1999, with an
aggregate borrowing limit of $310,000,000. The proceeds were used by the Company
to finance the tender offer of its 11.875% Senior Secured Notes due 2005 (the
"Notes") and extinguish the existing credit agreement.

     The new Credit Facility includes a $220,000,000 term loan (the "Term Loan")
and a $90,000,000 revolver (the "Revolver") of which approximately $4,200,000
was available at December 31, 1999. The Term Loan and the Revolver bear interest
at the Company's option, at a base rate plus 2.25% and 1.75%, respectively, or
at a LIBOR rate plus 3.25% or 2.75%, respectively. The interest rates on the
Term Loan ranged from 9.41% to 9.43% and the interest rates on the Revolver
ranged from 8.68% to 8.78% at December 31, 1999. The margins above the base rate
and the LIBOR rate at which the Revolver bears interest are subject to
reductions based on certain leverage ratios. The unused portion of the Revolver
is subject to a commitment fee ranging from 0.75% per annum to 0.375% per annum
based on certain leverage ratios.

     The Company is required to make scheduled payments on the Term Loan
beginning in 2002 to maturity in 2007. In addition, the Company is required to
make prepayments on the Term Loan and the Revolver under certain circumstances,
including upon the sale of certain assets and the issuance of certain debt or
equity securities. Beginning in 2002, the Company is required to make
prepayments on the Term Loan and the Revolver in an amount equal to 50% of
excess cash flow.

     The commitment under the Revolver will be permanently reduced over the
period from June 2002 to maturity in 2007. In addition, the commitment under the
Revolver will be permanently reduced in certain circumstances including upon the
sales of certain assets and the issuance of certain debt or equity securities
and with excess cash flow. The Company has the right to pay down the Revolver
without penalty in increments of $1,000,000.

     The Credit Facility contains certain financial covenants, including, but
not limited to, covenants related to interest coverage, total and senior
leverage ratios and fixed charge ratio. In addition, the Credit Facility
contains 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, guarantees and
investments. The Credit Facility contains customary events of default for
highly-leveraged financings, including certain changes in ownership or control
of the Company. The Credit Facility is secured by the Company's present and
future property and assets and the common stock of BLC.

OTHER NOTES

   Other notes payable consist of multiple financing agreements requiring
monthly payments including interest from 2.9% to 15.6% on notes maturing from
2000 through 2024 that are collateralized by various assets of the Company.


                                      F-19





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     Notes payable consist of the following:

<TABLE>
<CAPTION>
                                                                     December 31,
                                                         --------------------------------------
                                                               1998                 1999
                                                               ----                 ----
                                                                    (In thousands)

<S>                                                      <C>                    <C>
 Senior Secured Notes..........................                $  135,000             $      -
 Revolver......................................                        -                58,500
 Term Loan.....................................                         -              220,000
 Prior year term loans.........................                   108,317                    -
 Discount Notes - see (Note F) for terms.......                   125,413              140,049
 Other.........................................                     6,086                9,030
                                                         -----------------    -----------------
                                                                  374,816              427,579
 Less current maturities.......................                    15,911                1,300
                                                         -----------------    -----------------
                                                               $  358,905           $  426,279
                                                         =================    =================
</TABLE>

     At December 31, 1999, the notes provide for annual reductions as follows:


<TABLE>
<CAPTION>
Year Ending December 31,
------------------------
                                                     (In thousands)

<S>                                                    <C>
2000.....................................              $    1,300
2001.....................................                 141,397
2002.....................................                   3,586
2003.....................................                   2,772
2004.....................................                  11,614
Thereafter...............................                 266,910
                                               -------------------
                                                       $  427,579
                                               ===================
</TABLE>

(2)    INTEREST RATE CAP

     During August 1999, in accordance with certain covenants of the Credit
Facility, the Company entered into an interest rate cap agreement which matures
in September 2001, 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 British
Bankers' Association interest settlement rates ("settlement rate") for U.S.
dollar deposits exceeds 8.00% on a notional amount totaling $70,000,000 subject
to an amortization schedule. As of December 31, 1999, the settlement rate was
6.18%. The $168,000 premium paid for this interest rate cap is being amortized
ratably to interest expense over the 24-month term of the cap, and is reported
as an other asset in the accompanying consolidated balance sheets. 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.


                                      F-20




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

(3)    LOSS ON EXTINGUISHMENT OF DEBT

     On April 16, 1999, the Company commenced a tender offer and consent
solicitation (the "Offer") for any and all of the $135,000,000 in outstanding
principal amount of the Notes. The total consideration for each of $1,000
principal of Notes was $1,105.78 which consisted of the Offer price per $1,000
principal of Notes of $1,075.78 and a consent payment of $30 per $1,000
principal amount of Notes.

     On May 20, 1999, the Company redeemed all of the outstanding Notes. The
offer was financed through the Credit Facility. A total of $12,510,000 (net of
$8,340,000 of applicable income taxes) was reflected as a loss on the early
extinguishment of debt which was comprised of prepayment premiums, consent
payments, expenses of the transaction and a write-off of unamortized fees
associated with the Notes and then existing credit agreement.

(NOTE H) - PROGRAM BROADCAST RIGHTS AND LIABILITIES

Program broadcast rights and program broadcast liabilities consist of the
        following:

<TABLE>
<CAPTION>
                                                             Program            Program
                                                            Broadcast          Broadcast
                                                             Rights           Liabilities
                                                          --------------     ---------------
                                                                   (In thousands)

<S>                                                       <C>                 <C>
Balance at December 31, 1997.........................          $  6,665            $  8,115
     Contracts acquired..............................             6,169               6,169
     Amortization....................................           (6,758)                   -
     Payments........................................                 -             (6,399)
                                                          --------------     ---------------
Balance at December 31, 1998.........................             6,076               7,885
     Contracts acquired..............................             8,186               8,186
     Net addition due to station swap (Note B).......               979                 970
     Amortization....................................           (8,127)                   -
     Payments........................................                 -             (7,455)
                                                          --------------     ---------------
Balance at December 31, 1999.........................          $  7,114            $  9,586
                                                          ==============     ===============
</TABLE>

The current maturities of program broadcast liabilities consist of the
following:

<TABLE>
<CAPTION>
                                                                   December 31,
                                                        ------------------------------------
                                                             1998                1999
                                                             ----                ----
                                                                  (In thousands)

<S>                                                     <C>                 <C>
Program contracts, due in varying installments........         $  7,885            $  9,586
Less current maturities...............................           (6,994)             (8,608)
                                                        ----------------    ----------------
Long-term portion.....................................          $   891             $   978
                                                        ================    ================

</TABLE>

                                      F-21





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)


The maturities of the contracts are as follows at December 31, 1999:

<TABLE>
<CAPTION>
Year Ending December 31,
------------------------
                                                                              (In thousands)

<S>                                                                           <C>
2000...............................................................             $    8,608
2001...............................................................                    793
2002...............................................................                    161
2003...............................................................                     19
2004...............................................................                      5
                                                                         -----------------
                                                                                $    9,586
                                                                         ==================
</TABLE>

     In addition, the Company has entered into noncancellable commitments for
future program broadcast rights aggregating approximately $19,464,000 as of
December 31, 1999 with future payments as follows:


<TABLE>
<CAPTION>
Year Ending December 31,
------------------------
                                                                              (In thousands)

<S>                                                                          <C>
2000.....................................                                       $    1,892
2001.....................................                                            6,007
2002.....................................                                            4,746
2003.....................................                                            2,443
2004.....................................                                            2,424
Thereafter...............................                                            1,952
                                                                        -------------------
                                                                                $   19,464
                                                                        ===================
</TABLE>

(NOTE I) - ACCOUNTS PAYABLE AND ACCRUED EXPENSES

     Accounts payable and accrued expenses consist of the following:

<TABLE>
<CAPTION>
                                                                               December 31,
                                                                    -----------------------------------
                                                                         1998               1999
                                                                         ----               ----
                                                                              (In thousands)

<S>                                                                  <C>                 <C>
             Trade payables...................................            $  1,073            $  3,404
             Barter, net......................................                 526                 271
             Compensation and benefits........................               3,093               3,921
             Interest.........................................               5,624                 601
             Other............................................               1,661               1,972
                                                                    ---------------    ----------------
                                                                         $  11,977           $  10,169
                                                                    ===============    ================
</TABLE>

 (NOTE J) - LEASES

     The Company leases land, office space and office and transportation
equipment under agreements which expire from 2000 through 2007 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
currently leases its premises in Parkersburg, West Virginia. The Company has
committed to exercise their option to acquire the premises on May 1, 2000 for
$650,000.



                                      F-22




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     The Company has the option to purchase its leased premises in Casper,
Wyoming upon written notice to the landlord at any time during the 10-year term
which expires March 5, 2007. At December 31, 1999, the option purchase price was
$400,435 which increases each year through 2004 by six percent and each year
thereafter by three percent of the original option purchase price.

     The approximate total minimum rental commitments at December 31, 1999 under
these leases are due as follows:

<TABLE>
<CAPTION>
Year Ending December 31,
------------------------
                                                                        (In thousands)

<S>                                                                      <C>
2000.....................................                                      $     923
2001.....................................                                            713
2002.....................................                                            557
2003.....................................                                            307
2004.....................................                                            136
Thereafter...............................                                            312
                                                                       ------------------
                                                                              $    2,948
                                                                       ==================
</TABLE>

     Total rental expense under these agreements and other monthly rentals for
the years ended 1997, 1998 and 1999 was approximately $1,416,000, $1,244,000,
and $1,127,000, 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
1997, 1998 and 1999 was approximately $1,030,000, $990,000, and $1,000,000,
respectively.

(NOTE K) - INCOME TAX MATTERS

     On June 6, 1996 when the Company changed tax status, the accumulated
deficit of $41,073,000 which existed on that date was reclassified to additional
paid-in capital.

     The deferred tax assets and liabilities consist of the following components
for the Company:

<TABLE>
<CAPTION>
                                                                          December 31,
                                                                 ---------------------------------
                                                                      1998               1999
                                                                      ----               ----
                                                                          (In thousands)
<S>                                                               <C>                <C>
Deferred tax assets:
   Loss carryforwards....................................              $  5,385           $ 10,458
   Receivable allowances and accruals....................                 1,191              1,085
   Network agreements....................................                 1,178              1,205
   Original issue discount...............................                14,094             20,585
                                                                 ---------------    ---------------
                                                                         21,848             33,333
                                                                 ---------------    ---------------
Deferred tax liabilities:
   Property and equipment................................                 7,877              6,788
   Intangibles...........................................                46,545             48,751
                                                                 ---------------    ---------------
                                                                         54,422             55,539
                                                                 ---------------    ---------------
   Net deferred tax liability............................            $ (32,574)         $ (22,206)
                                                                 ===============    ===============
</TABLE>

                                      F-23






<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     The total income tax benefit for the years ended December 31, 1997, 1998
and 1999 was $12,027, $8,052 and $9,717, respectively. Those amounts have been
allocated to the following financial statement items:

<TABLE>
<CAPTION>
                                              1997               1998                1999
                                          --------------    ----------------    ----------------
                                                              (In thousands)

<S>                                       <C>                <C>                <C>
Loss from continuing operations......          $ 12,027            $  8,052           $   1,377
Extraordinary item...................                 -                   -               8,340
                                          --------------    ----------------    ----------------
                                               $ 12,027            $  8,052           $   9,717
                                          ==============    ================    ================
</TABLE>

     The income tax benefit related to continuing operations before income taxes
and the extraordinary item for the Company consisted of the following:

<TABLE>
<CAPTION>
                                              1997               1998                1999
                                          --------------    ----------------    ----------------
                                                              (In thousands)

<S>                                       <C>                 <C>                <C>
Current tax expense..................          $  (349)            $  (265)           $   (651)
Deferred tax benefit.................            12,376               8,317               2,028
                                          --------------    ----------------    ----------------
                                               $ 12,027            $  8,052           $   1,377
                                          ==============    ================    ================
</TABLE>

     Under the provisions of the Internal Revenue Code, the Company and its
subsidiaries have approximately $26,200,000 of net operating loss carryforwards
which expire in 2007 through 2019 that are available to offset future tax
liabilities.

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

<TABLE>
<CAPTION>
                                                                      December 31,
                                                       ---------------------------------------------
                                                          1997             1998             1999
                                                       ------------     ------------     -----------

<S>                                                      <C>              <C>             <C>
Computed "expected" income tax benefit............       (35.0)%          (35.0)%         (35.0)%
Increase (decrease) resulting from:
    State income taxes, net of federal effect.....        (5.0)            (5.0)           (5.0)
    Nondeductible amortization and expenses.......         5.1              7.7            12.7
    Nondeductible write-off of intangibles
       related to sale of station.................           -                -            16.1
    Other, net....................................         1.8             (0.3)            3.2
                                                       ------------     ------------     -----------
Effective tax rate................................       (33.1)%          (32.6)%          (8.0)%
                                                       ============     ============     ===========

</TABLE>

     The tax effect  related to the  extraordinary  item (Note G) is deferred
and it approximates the statutory U.S. tax rate.


                                      F-24





<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)


 (NOTE L) - PREFERRED AND COMMON STOCK

     The Board of Directors of the Company has authorized 2,500,000 shares of
preferred stock of which 550,000 was issued and outstanding as of December 31,
1999. 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 1,950,000 unissued shares.

     The following table summarizes common stock:

<TABLE>
<CAPTION>
                                                                                       December 31,
                                                                           ------------------------------------
                                                                                 1998                1999
                                                                                 ----                ----
<S>                                                                           <C>                <C>
 Common stock, Class A par value $0.01, one vote per share
    Authorized shares............................................              10,000,000         10,000,000
    Issued and outstanding shares................................                    None               None

 Common stock, Class B par value $0.01, ten votes per share,
    convertible into Class A common stock at a ratio of 1:1
    Authorized shares............................................              10,000,000         10,000,000
    Issued and outstanding shares................................               7,400,000          7,400,000
</TABLE>


(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 and current payables 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.
The interest rate cap agreement carrying value approximates fair value due to
the relationship of the cap rate to current interest rates.

     The following table shows the carrying amounts and estimated fair values of
other financial instrument liabilities at December 31, 1998 and 1999:

<TABLE>
<CAPTION>
                                                         1998                                 1999
                                           ---------------------------------    ---------------------------------
                                             Carrying           Estimated          Carrying          Estimated
                                              Amount           Fair Value           Amount          Fair Value
                                           --------------     --------------    ---------------    --------------
                                                                      (In thousands)
<S>                                        <C>                <C>                <C>               <C>
Program broadcast liabilities                   $  7,885           $  7,461           $  9,586          $  9,081
Other notes payable.................               6,086              6,086              9,030             9,030
Notes...............................             135,000            147,150                  -                 -
Discount Notes......................             125,413            117,300            140,049           152,387
Senior Preferred Stock..............             107,596             69,000            122,092            82,000
Junior Preferred Stock..............              55,048             48,478             59,539            54,778
</TABLE>


                                      F-25




<PAGE>



                BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(CONTINUED)

     The fair value of program broadcast liabilities and other notes payable
were estimated using the discounted cash flow method.

     The fair value of the Discount Notes, Notes and Senior Preferred Stock were
estimated using readily available quoted market prices.

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

     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.

(NOTE N) - PENDING ADOPTION OF ACCOUNTING STANDARD

     The FASB (Financial Accounting Standards Board) has issued FASB statement
No. 133 "Accounting for Derivative Instruments and Hedging Activities" which the
Company will be required to adopt for its fiscal year ending December 31, 2001.
This pronouncement establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, (collectively referred to as derivatives) and for hedging activities.
It requires that an entity recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those instruments
at fair value. This pronouncement is not expected to have a significant impact
on the Company's financial statements since the Company's only derivative
financial instrument is an interest rate cap.

                                      F-26





<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 is not a part of the basic consolidated
financial statements. This schedule has been subjected to the auditing
procedures applied in our audits of the basic consolidated financial statements
and, in our opinion, is 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 18, 2000


                                       S-1





<PAGE>




                                                                     SCHEDULE II

                            BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                                     VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
                                                                               Additions
                                           Balance at         Balances         Charged to        Deductions       Balance at
                                           Beginning         Acquired in       Costs and         Described          End of
                                           of Period         Acquisition        Expenses            (1)             Period

                                          ------------------------------------------------------------------------------------
Deducted from asset account -
allowance for doubtful accounts:

<S>                                        <C>                <C>              <C>               <C>              <C>
  Year ended December 31, 1997                $483,519           $ -            $231,480          $243,347         $471,652
  Year ended December 31, 1998                 471,652             -             552,357           543,834          480,175
  Year ended December 31, 1999                 480,175             -             642,988           440,398          682,765


(1)   Uncollectible accounts written off, net of recoveries

</TABLE>

                                      S-2