Exhibit 10.1


 


November 18, 2005


 


Mr. Terry
Mackin


Executive
Vice President


Hearst-Argyle
Television, Inc.


888
Seventh Avenue - 27th Floor


New
York, NY  10106


 


Dear Terry:


 


Reference
is made to the Affiliation Agreement (“the Agreement”) between Hearst-Argyle Properties, Inc.,
as assignee and successor to Pulitzer Broadcasting Company (“Broadcaster”)
and CBS, dated February 6, 1995, as amended, regarding the affiliation of
television station WLKY-TV (“Station”), in Louisville, Kentucky, with the CBS
Television Network.


 


You
and we mutually agree in this Letter Agreement to the following amendments and additional
terms and conditions of the Agreement:


 


1.               In order to clarify
that Broadcaster’s “first call” rights to Network Programs extend to such
programs in digital format, you and we agree that the initial words of
Paragraph 1 of the Agreement prior to the start of Subparagraph 1(a) shall
be  deleted and replaced by the following
language:


 


“1.                                 Offer,
Acceptance and Delivery of Network Programs


 


Broadcaster
shall have a “first call”, as set forth below, on the program offerings of the
CBS Television Network (“Network Programs”). 
Such “first call” rights shall apply to Network Programs in both analog
and digital format, it being understood that, with respect to digital
broadcasting, “Network Programs” shall refer to the “Primary Network Feed”,
which during the digital transition shall mean the digital version of those
programs transmitted to CBS Affiliates for the purpose of analog broadcasting,
and not to any additional program streams that may be transmitted by the
Network (i.e., “multi-plexed” programming).”


 


In the event that CBS offers a
Network multiplexed channel, Station shall have first call rights to such
channel in Station’s DMA and CBS agrees to enter into exclusive good faith
negotiations for thirty (30) days regarding the terms pursuant to which such
multiplexed programming or ancillary data may be carried on Station.


 





















 


2.               In
order to clarify that Broadcaster’s network non-duplication protection rights  apply to digital as well as analog
broadcasting of Network Programs, you and we agree that the words “in analog
and digital formats” shall be inserted into the second line of Subparagraph 9(b) of
the Agreement after the words “network programming”, so that the beginning of
this subparagraph will read as follows:


 


“Broadcaster
shall be entitled to exercise, within Affiliated Station’s Network Exclusivity
Zone, the protection against duplication of network programming in analog and
digital formats,”


 


Also,
due to modification of the FCC’s regulations, you and we agree that the
reference in the same Subparagraph 9(b) to “Section 76.92 through
76.97 of the  FCC rules” shall be amended
to read “Sections 76.92 through 76.95 of the FCC rules.”


 


3.               In
addition, you and we agree to the following additional terms and conditions
which shall be made part of the Agreement:


 


Station will, to the same
extent as the Agreement provides for carriage of Network programs on its analog
channel, transmit on such DTV channel the digital feed of such Network Programs
in the technical format, consistent with  the ATSC standards, provided by CBS, which
shall be deemed to include the transmission by Station of all program related
material, as defined below, provided by CBS which can be accommodated within a
six MHz channel  carrying a data stream
of up to 19.39 megabits per second.  It
is expressly understood that this Agreement applies only to the Primary Network
Feed in digital format of the program provided by the Network to its affiliated
stations, together with any associated program related material, and that
Broadcaster will in no event be required to carry additional Network digital
programming (i.e., “multiplexed” programming). 
Consistent with and subject to the foregoing, the Station shall have the
right to use any available portion of its digital signal for the purpose of
transmitting local programs or any other material; provided, however, that in
the event that CBS proposes that the Station carry Network multiplexed programming
or ancillary data which is not “program related material”, Broadcaster agrees
to negotiate in good faith with CBS regarding the terms pursuant to which such
multiplexed programming or ancillary data may be carried.  As used in this paragraph, “program-related
material” shall mean (i) information and material of a  commercial or non-commercial nature which is
directly related to the subject matter or identification of, or persons
appearing in, the Network Programs, or to specific Network commercial
advertisements or promotional announcements contained in the Network Programs,
if such


 


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information or material is
transmitted concurrently or substantially concurrently with the associated
Network Program, commercial advertisement or promotional announcement,  (ii) closed-captioning information, (iii) program
identification codes, (iv) program ratings information, (v) alternative
language feeds related to the programming, (vi) video description information,
and (vii) such other  material as
may be essential to or necessary for the delivery or distribution of the
Network Programs in digital format.


 


Notwithstanding the foregoing,
it is understood by the parties that Station shall have the unfettered right to
utilize for its own purposes a data stream of up to 5 megabits per second
during the Term hereof.  It is understood
by the parties; however, that Station will use its commercially reasonable efforts
to carry the Network Programs and program-related material in the technical
format as provided by CBS.


 


4.               Subject to the FCC’s Right to Reject under Section 73.658(e) of
the FCC’s Rules, and superseding previous understandings regarding clearance of
Network Programs, Station will provide and maintain full, in-pattern clearance
of all Network Programs (or, any such program’s replacement) in all day-parts (including,
but not limited to, Weekend Sports Network Programs), in accordance with the
foregoing and the attached Schedule A. Station
agrees to broadcast such Network Program in its entirety (including but
not limited to commercial announcements, billboards, credits, public service
announcements, promotional announcements and network identification), without
interruption, alteration, compression, deletion or addition of any kind, from
the beginning of the Network Program to the final system cue at the conclusion
of the Network Program and not  to downgrade, delay, cancel or change time
periods of any Network Program  without
the written consent of CBS.  It is
understood; however, that Station may utilize commercially available
compression technology to compress the Network digital signal so long as, in
the reasonable judgment of CBS engineers, it does not degrade the audio or
picture quality detectable to viewers utilizing home digital television
receivers nor impair the functionality of any program-related material.  Further, Station agrees (i) upon CBS’
discontinuance of the “co-op version” of THE EARLY SHOW, to
provide live clearance of the “full-network” format of THE EARLY
SHOW (or its replacement), 7:00-9:00am local time, Monday-Friday; and
 (ii) to provide clearance of at
least two (2) hours per weekday of the overnight service  UP TO THE MINUTE
(or its replacement).


 


CBS agrees that Station will continue
clearance of FACE THE NATION (or its replacement) on a delay basis as set forth
in Schedule A.  Station will make
commercially reasonably efforts to provide live clearance of FACE THE NATION
(or its replacement), currently 10:30-11:00am local time Sunday, upon
cancellation


 


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or schedule change
of Station’s current programming airing 10:30-11:00am local time Sunday.


 


Broadcaster agrees to limit
one-time-only primetime preemptions to no more than 15 hours per calendar year allocated
proportionally in partial years (“the Primetime Preemption Cap”).  Any Primetime preemption beyond 15
hours annually shall be considered a breach of the Affiliation Agreement unless such
preemptions are made pursuant to Section 73.658(e) of the FCC’s rules.


 


Similarly, Broadcaster agrees
to limit one-time-only preemptions of Weekend Sports programming to no more
than 15 hours per calendar year allocated proportionately in partial years (“the
Weekend Sports Cap”).  Any Weekend
Sports preemption beyond 15 hours annually shall be considered a breach of the
Affiliation Agreement unless such preemptions are made pursuant to Section 73.658(e) of
the FCC’s rules.


 


Station will promptly notify
CBS of any preemption and payment of any Preemption Fee will be made within
sixty (60) days of the written notification from CBS of the amount due.


 


It is understood that
Station’s obligations pursuant the above provisions shall be subject to Station’s
rights under Section 73.658 (e) of the FCC’s rules and Paragraph
5 (a) of the Agreement, and that Station’s exercise of such rights shall in
no event be deemed a breach of the obligations set forth in the above paragraph
and shall not count against the Primetime Preemption Cap or the Weekend Sports
Cap as set forth above; provided, however, that nothing in the foregoing will
be construed to permit Station to preempt a program, regardless of the reason
for the preemption, in its live or agreed time period, and then broadcast such
program in a different time period, without the express written consent of CBS.  Station agrees  to makegood in a mutually agreed upon time
period all primetime preemptions made for reasons other than the Right to
Reject Rule as defined in Section  73.658(e) of the FCC rules.


 


5.               This Letter Agreement and the terms herein
shall become effective July 1, 2005  and Paragraph 3(a) of the Agreement shall
be deleted and replaced by the  following
new Paragraph 3(a):


 


“3.   Term and Termination.


 


(a)   Term.


 


The term of this Agreement shall be the period
commencing on July 1, 2005 and expiring on June 30, 2015.  Notwithstanding any


 


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provision of any offer or
acceptance under Paragraph 1 hereof, upon the expiration or any termination of
the term of this Agreement, Broadcaster shall have no right whatsoever to
broadcast over Affiliated Station any Network Program.”


 


6.               Station agrees to
participate in CBS’ Coop and Promo Swap Programs as requested by CBS provided
the elements of such Programs remain similar to the current Programs.


 


7.               Station agrees to
abide by the standard CBS Service Mark requirements specifying  acceptable ways Station may utilize the CBS
Eye Service Mark in on-air and print advertising.


 


8.               The
Affiliated Station’s Annual Net Compensation as specified in Paragraphs 2(a) through
2(c) of the Agreement will be revised to the amount shown below on the
indicated Effective Date:


 


	
  Effective

  	
   

  	
  Annual Net

  	
   

  
	
  Date

  	
   

  	
  Compensation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  July 1, 2005 – June 30, 2006

  	
   

  	
  $

  	
  660,000

  	
   

  
	
  July 1, 2006 – June 30, 2007

  	
   

  	
  $

  	
  330,000

  	
   

  
	
  July 1, 2007 – June 30, 2015

  	
   

  	
  $

  	
  0

  	
   

  



 


The foregoing represents CBS’s total financial
contribution to Station during this Term and supercedes all previous agreements
with respect thereto, including, but not limited to, all compensation,
promotion and capital contributions. It is acknowledged by the parties,
however, that CBS and Station may elect to enter into future agreements
regarding monetary contributions for promotional and other commitments.  Payments of Annual Net Compensation shall be
paid in twelve (12) equal installments and shall be due and payable monthly, in
arrears, within 20 days from the end of each calendar month during the
applicable period for which Annual Net Compensation is due.  All references in the Agreement to Network
Rate shall be deleted.


 


9.               In
order to implement new terms pertaining to the assignment of the Agreement to a
new owner in the event the Station is sold, you and we agree that Paragraph 3(b) of
the Agreement is hereby deleted and replaced by the following new Paragraph
3(b):


 


“3.                                 Term
and Termination.


 


(b)                                 Termination
on Transfer of License or Interest in Broadcaster.


 


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Broadcaster
shall notify CBS forthwith if any application is made to the Federal
Communications Commission relating to a transfer either of any interest in
Broadcaster or of Broadcaster’s license for Station.  In the event that that proposed transferee is
(i) an entity which owns, controls or has five (5) percent or greater
equity interest in either the ABC Television Network, the Fox Television
Network, the NBC Television Network or the WB Television Network, or any
successor of those networks (a “Competing Network”) or (ii) is an entity
in which any owner, parent, subsidiary or affiliated entity of a Competing
Network has a five (5) percent or greater equity interest, then CBS shall
have the right to terminate this Agreement effective as of the effective date
of any such transfer by giving Broadcaster notice thereof, within thirty (30)
days after the date on which Broadcaster gives CBS notice of such
application.  If the preceding sentence
does not apply (in which case CBS shall have no termination right), or if CBS
does not timely terminate this Agreement in accordance with the preceding
sentence, Broadcaster shall, prior to the effective date of any such transfer
of any interest in Broadcaster or of Broadcaster’s license for Station, and as
a condition precedent to such transfer, procure and deliver to CBS, in form
reasonably satisfactory to CBS, the agreement of the proposed transferee that,
upon consummation of the transfer, the transferee will unconditionally assume
and perform all obligations of Broadcaster under this Agreement.  Upon delivery of such agreement to CBS, the
provisions of this Agreement applicable to Broadcaster shall, effective upon
the date of such transfer, be applicable to such transferee, and Broadcaster
shall have no further obligation under this Agreement.”


 


10.         In
order to reflect that television markets now generally are defined with
reference to Nielsen DMAs rather than with reference to Arbitron ADIs, you and
we agree that in Subparagraph 9(a) of the Agreement the language “the Area
of Dominant Influence (ADI), as determined by Arbitron and published in the
then-current edition of its Television ADI Market Guide,” shall be stricken and
replaced with the following: “the Designated Market Area (DMA), as most
recently determined by the A.C. Nielsen Company,”.


 


11.         In
order to permit notices pursuant to the Agreement to be made by facsimile
delivery, you and we agree that the word “facsimile” shall be inserted between “personal
delivery,” and “mail” in the first sentence of Subparagraph 11(d) of the
Agreement, so that the beginning of the subparagraph will read as follows:


 


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“11(d) Unless
specified otherwise, all notices given hereunder shall be given in writing by
personal delivery, facsimile, mail,”


 


12.         The
terms of this Letter and Affiliation Agreement, and discussions related thereto,
will not be disclosed to anyone who is not either employed by the Station or
the corporate ownership of the Station or its affiliates, representatives, or
advisors (provided such parties agree to the confidentiality requirements herein);
it being understood, however, that adherence to FCC filing and disclosure requirements
or otherwise as may be required by law or the rules of any exchange or
market on which the securities of Broadcaster or its affiliates are listed, will
not constitute a violation of this provision. 
Any press release regarding the terms of this negotiation or Agreement,
shall be made jointly by the parties.


 


13.         Paragraph
7 of the Agreement is hereby amended by adding the following at the end of the
paragraph: “With respect to each
musical composition contained in the Network Programs, CBS  warrants
and represents that the performing rights in and to such musical compositions
are: (i) available for license through American Society of Composers,
Authors and Publishers (ASCAP), Broadcast Music, Inc. (BMI), or SESAC, Inc.;
or (ii) in the public domain; or (iii) controlled by CBS (or the licensor
of such Network Program) to the extent necessary to permit the broadcasts
hereunder. CBS further warrants that it (or the licensor of such Network
Program) has obtained appropriate synchronization rights from the publisher or
other entity whom owns, controls, or has the right to license such rights.


 


Further, it is hereby ratified and reaffirmed that the: (i) terms
of the September 23, 1998 and October 22, 2001 Letter Agreements
between you and us which established, among other things, Station’s NFL
Contribution and placed various program exclusivity requirements on the Network
plus any increase or renewals agreed to by the CBS Affiliate Board shall remain
in full force and effect per the terms of that Letter Agreement; (ii) Station’s
participation in the NCAA Exchange Value Program which established among other
things Station’s NCAA Contribution and minimum local Inventory requirements will
continue as set forth in the December 2, 2003 Letter Agreement; and (iii) Station’s
participation in CBS Newspath shall continue throughout the Term at the current
rate of $189,057, plus 6% an annual increase effective on  October 1, 2006, and, thereafter, by such
annual increases agreed to by the CBS Affiliate Board, and Station agrees to
the existing terms and conditions implemented by CBS Newspath with respect to
such services.  It is understood by the
parties that Station shall not be obligated to participate in Network News
Services (“NNS”) during the Term of this agreement; however, in the event
Station elects to participate, Station shall receive NNS at no charge.


 


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Following expiration of the NCAA Agreement, if CBS
reduces Station’s minimum  inventory
units guaranteed in the NCAA Agreement to a not comparable level, the Station
shall have the right to offset the loss by comparable adjustment in the
clearance of the Network Program(s). 
Furthermore, with respect to local inventory levels in day-parts not
guaranteed in the NCAA Agreement and excluding those provided in paragraph 11
of the current NFL Agreement for non-prime time day-parts, if CBS reduces
Station’s current local inventory units to a not comparable level, the Station
shall also have the right to offset the loss by comparable adjustment in the
clearance of the Network Program(s).  In
either event, the parties agree to renegotiate the clearance obligations in
good faith.


 


As herein amended, all terms and conditions of the
Agreement are ratified and confirmed. 
All individual reference herein to Station or Broadcaster shall apply to
both collectively.


 


Four originals of this Letter Agreement are
enclosed.  Please indicate your approval
by signing each original in the space provided below and return all originals to
me for counter-execution.  We will return
two fully executed originals to you.


 


	
  Accepted and agreed:

  	
   

  
	
   

  	
   

  
	
  Hearst-Argyle Properties, Inc.

  	
  CBS AFFILIATE RELATIONS

  
	
   

  	
  A Unit of CBS Broadcasting, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Terry Mackin

  	
   

  	
  By:

  	
  /s/ Peter K. Schruth

  	
   

  
	
   

  	
  Terry Mackin, Executive Vice President

  	
   

  	
  Peter K. Schruth, President

  
	
   

  	
   

  
	
  Best regards,

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  cc:  P. Schruth, D. Comisar, S. Costanzo, P.
  Farr

  	
   

  
						



 


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Schedule A WLKY - Louisville


 


Clearance
of CBS Programming on WLKY (all times local):


 


	
  Monday-Friday

  	
   

  	
   

  
	
  CBS Morning News

  	
   

  	
  4:30-5:00am

  
	
  The Early Show

  	
   

  	
  7:00-9:00am (Co-op
  format)

  
	
  Price Is Right

  	
   

  	
  11:00am-12:00pm

  
	
  Bold &
  Beautiful

  	
   

  	
  1:30-2:00pm

  
	
  As The World
  Turns

  	
   

  	
  2:00-3:00pm

  
	
  Guiding Light

  	
   

  	
  3:00-4:00pm

  
	
  Young &
  Restless

  	
   

  	
  4:00-5:00pm (Same
  day delay from 12:30pm)

  
	
  CBS Evening News

  	
   

  	
  6:30-7:00pm

  
	
  Prime Time

  	
   

  	
  8:00-11:00pm

  
	
  Late Show

  	
   

  	
  11:35pm-12:37pm

  
	
  Late Late Show

  	
   

  	
  12:37am-1:37am

  
	
  Up To The Minute

  	
   

  	
  Minimum two-hour
  clearance

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Saturday

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Sat.
  Early Show

  	
   

  	
  8:00-10:00am

  
	
  Kids Programming

  	
   

  	
  10:00am-12:00pm

  
	
  Sat. Evening
  News

  	
   

  	
  6:30-7:00pm

  
	
  Prime Time

  	
   

  	
  8:00-11:00pm

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Sunday

  	
   

  	
   

  
	
  CBS Sun. Morning

  	
   

  	
  9:00-10:30am

  
	
  Kids Programming

  	
   

  	
  11:00am-12:00pm

  
	
  Face The Nation

  	
   

  	
  12:30-1:00pm – 2nd & 3rd Qtr. (Same day delay from 10:30am)

  
	
   

  	
   

  	
  12:00-12:30am –
  1st & 4th Qtr. (Same day delay from 10:30am)

  
	
  Sun. Evening
  News

  	
   

  	
  6:00-6:30pm

  
	
  Prime Time

  	
   

  	
  7:00-11:00pm

  



 


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