Exhibit 10.1


[EXECUTION COPY]




 


AGREEMENT AND PLAN OF
MERGER





by and among


GREATBANC TRUST COMPANY,

solely as trustee of the

TRIBUNE EMPLOYEE STOCK OWNERSHIP TRUST

which forms a part of the

TRIBUNE EMPLOYEE STOCK OWNERSHIP PLAN,


TESOP CORPORATION,


TRIBUNE COMPANY


and


EGI-TRB, L.L.C.

(solely for the limited purposes of Section 8.12 hereof)


Dated as of April 1, 2007




 





















Table of Contents


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  THE MERGER

  	
  2

  
	
  Section 1.1

  	
  The Merger

  	
  2

  
	
  Section 1.2

  	
  Closing

  	
  2

  
	
  Section 1.3

  	
  Effective Time

  	
  2

  
	
  Section 1.4

  	
  Effects of the
  Merger

  	
  2

  
	
  Section 1.5

  	
  Certificate of
  Incorporation and By-laws of the Surviving Corporation

  	
  3

  
	
  Section 1.6

  	
  Directors

  	
  3

  
	
  Section 1.7

  	
  Officers

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES

  	
  3

  
	
  Section 2.1

  	
  Effect on
  Capital Stock

  	
  3

  
	
  Section 2.2

  	
  Exchange of
  Certificates

  	
  5

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

  	
  7

  
	
  Section 3.1

  	
  Qualification,
  Organization, Subsidiaries, etc.

  	
  7

  
	
  Section 3.2

  	
  Capital Stock

  	
  9

  
	
  Section 3.3

  	
  Corporate
  Authority Relative to This Agreement; No Violation

  	
  11

  
	
  Section 3.4

  	
  Reports and
  Financial Statements

  	
  13

  
	
  Section 3.5

  	
  Internal
  Controls and Procedures

  	
  14

  
	
  Section 3.6

  	
  No Undisclosed
  Liabilities

  	
  14

  
	
  Section 3.7

  	
  Compliance with
  Law; Permits

  	
  14

  
	
  Section 3.8

  	
  Environmental
  Laws and Regulations

  	
  16

  
	
  Section 3.9

  	
  Employee Benefit
  Plans

  	
  17

  
	
  Section 3.10

  	
  Absence of
  Certain Changes or Events

  	
  19

  
	
  Section 3.11

  	
  Investigations;
  Litigation

  	
  19

  
	
  Section 3.12

  	
  Proxy Statement;
  Other Information

  	
  19

  
	
  Section 3.13

  	
  Rights Plan

  	
  20

  
	
  Section 3.14

  	
  Tax Matters

  	
  20

  
	
  Section 3.15

  	
  Labor Matters

  	
  21

  
	
  Section 3.16

  	
  Intellectual
  Property

  	
  21

  
	
  Section 3.17

  	
  Real Property

  	
  22

  
	
  Section 3.18

  	
  Opinion of
  Financial Advisor

  	
  22

  
	
  Section 3.19

  	
  Required Vote of
  the Company Shareholders

  	
  22

  
	
  Section 3.20

  	
  Material
  Contracts

  	
  23

  
	
  Section 3.21

  	
  Finders or
  Brokers

  	
  23

  
	
  Section 3.22

  	
  Insurance

  	
  23

  
	
  Section 3.23

  	
  Affiliate
  Transactions

  	
  23

  
	
  Section 3.24

  	
  Indebtedness

  	
  24

  
	
  Section 3.25

  	
  Cable and
  Satellite Matters

  	
  24

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  REPRESENTATIONS AND WARRANTIES OF THE ESOP AND
  MERGER SUB

  	
  24

  
	
  Section 4.1

  	
  Qualification,
  Organization; Subsidiaries, etc.

  	
  24

  



 



 ii
 









 


	
  Section 4.2

  	
  Authority
  Relative to This Agreement; No Violation

  	
  24

  
	
  Section 4.3

  	
  Investigations;
  Litigation

  	
  25

  
	
  Section 4.4

  	
  Proxy Statement;
  Other Information

  	
  26

  
	
  Section 4.5

  	
  Capitalization
  of Merger Sub

  	
  26

  
	
  Section 4.6

  	
  Lack of
  Ownership of Company Common Stock

  	
  26

  
	
  Section 4.7

  	
  Finders or
  Brokers

  	
  26

  
	
  Section 4.8

  	
  No Additional
  Representations

  	
  26

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  COVENANTS AND AGREEMENTS

  	
  27

  
	
  Section 5.1

  	
  Conduct of
  Business by the Company

  	
  27

  
	
  Section 5.2

  	
  Investigation

  	
  31

  
	
  Section 5.3

  	
  No Solicitation

  	
  32

  
	
  Section 5.4

  	
  Proxy Statement;
  Company Meeting

  	
  35

  
	
  Section 5.5

  	
  Stock Options
  and Other Stock-Based Awards; Employee Matters

  	
  36

  
	
  Section 5.6

  	
  Reasonable Best
  Efforts

  	
  39

  
	
  Section 5.7

  	
  Takeover Statute

  	
  42

  
	
  Section 5.8

  	
  Public
  Announcements

  	
  42

  
	
  Section 5.9

  	
  Indemnification
  and Insurance

  	
  42

  
	
  Section 5.10

  	
  Control of
  Operations

  	
  44

  
	
  Section 5.11

  	
  Financing

  	
  44

  
	
  Section 5.12

  	
  Specified
  Divestitures

  	
  45

  
	
  Section 5.13

  	
  FCC Matters

  	
  45

  
	
  Section 5.14

  	
  Company Offer

  	
  46

  
	
  Section 5.15

  	
  Eagles Exchange

  	
  46

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  CONDITIONS TO THE MERGER

  	
  47

  
	
  Section 6.1

  	
  Conditions to
  Each Party’s Obligation to Effect the Merger

  	
  47

  
	
  Section 6.2

  	
  Conditions to
  Obligation of the Company to Effect the Merger

  	
  47

  
	
  Section 6.3

  	
  Conditions to
  Obligations of the ESOP and Merger Sub to Effect the Merger

  	
  48

  
	
  Section 6.4

  	
  Frustration of
  Closing Conditions

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
  TERMINATION

  	
  49

  
	
  Section 7.1

  	
  Termination or
  Abandonment

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  MISCELLANEOUS

  	
  51

  
	
  Section 8.1

  	
  No Survival of
  Representations and Warranties

  	
  51

  
	
  Section 8.2

  	
  Expenses

  	
  51

  
	
  Section 8.3

  	
  Counterparts;
  Effectiveness

  	
  51

  
	
  Section 8.4

  	
  Governing Law

  	
  51

  
	
  Section 8.5

  	
  Jurisdiction;
  Enforcement

  	
  51

  
	
  Section 8.6

  	
  WAIVER OF JURY
  TRIAL

  	
  52

  
	
  Section 8.7

  	
  Notices

  	
  52

  
	
  Section 8.8

  	
  Assignment;
  Binding Effect

  	
  54

  
	
  Section 8.9

  	
  Severability

  	
  54

  
	
  Section 8.10

  	
  Entire
  Agreement; Third-Party Beneficiaries

  	
  54

  
	
  Section 8.11

  	
  Amendments; Waivers

  	
  54

  
	
  Section 8.12

  	
  Tribune
  Acquisition Rights

  	
  55

  



 



 iii
 









 


	
  Section 8.13

  	
  Headings

  	
  55

  
	
  Section 8.14

  	
  Interpretation

  	
  55

  
	
  Section 8.15

  	
  No Recourse

  	
  55

  
	
  Section 8.16

  	
  Definitions

  	
  56

  



 


EXHIBITS


	
  Exhibit
  A – Certificate of Incorporation

  
	
  Exhibit B – By-Laws

  
	
  Exhibit C – Exchange Agreement

  



 



 iv















AGREEMENT AND PLAN OF MERGER, dated as of
April 1, 2007 (the “Agreement”), among GreatBanc Trust Company, not
in its individual or corporate capacity, but solely as trustee (the “ESOP
Fiduciary”) of the Tribune Employee Stock Ownership Trust, which forms a
part of the Tribune Employee Stock Ownership Plan (the “ESOP”), Tesop
Corporation, a Delaware corporation all of the common stock of which is owned
by the ESOP (“Merger Sub”), Tribune Company, a Delaware corporation (the
“Company”), and EGI-TRB, L.L.C., a Delaware limited liability company (“Tribune
Acquisition”) (solely for the limited purposes of Section 8.12 hereof).


W  I  T  N  E
S  S  E  T  H :


WHEREAS, the parties intend that Merger Sub be merged
with and into the Company (the “Merger”), with the Company surviving the
Merger.


WHEREAS, concurrently herewith, the Company, Tribune
Acquisition and Samuel Zell have entered into a Securities Purchase Agreement
(the “Tribune Purchase Agreement”) pursuant to which Tribune Acquisition
has,  on the terms and subject to the
conditions set forth in the Tribune Purchase Agreement, agreed to purchase
(a) 1,470,588 shares of Company Common Stock (as defined below) and an
unsecured $200,000,000 subordinated exchangeable note (the “Subordinated
Exchangeable Note”) prior to consummation of the Merger and (b) an
unsecured $225,000,000 subordinated promissory note (the “Subordinated Note”)
and a warrant (the “Warrant”) to purchase 43,478,261 shares of common
stock of the Surviving Corporation (as defined below) immediately following
consummation of the Merger.


WHEREAS, concurrently herewith, the ESOP Fiduciary, on
behalf of the ESOP, and the Company have entered into an Equity Purchase
Agreement (the “ESOP Purchase Agreement”) pursuant to which the ESOP  has,  on
the terms and subject to the conditions set forth in the ESOP Purchase
Agreement, agreed to purchase 8,928,571  shares
of Company Common Stock prior to consummation of the Merger.


WHEREAS,
concurrently herewith, the Company has entered into a Voting Agreement with
Chandler Trust No. 1 and Chandler Trust No. 2, pursuant to which Chandler Trust
No. 1 and Chandler Trust No. 2 have agreed, among other things, to vote in
favor of this Agreement and the Merger.


WHEREAS, concurrently herewith, the Company, Tribune
Acquisition and the ESOP Fiduciary, on behalf of the ESOP, have entered into an
Investor Rights Agreement (the “Investor Rights Agreement”) pursuant to
which the parties thereto will have certain rights and obligations as the
Surviving Corporation and the stockholders of the Surviving Corporation, as
applicable.


WHEREAS, the Board of Directors of the Company, acting
upon the recommendation of a special committee of independent directors of the
Company (the “Special Committee”), has (a) determined that it is in the
best interests of the Company and its shareholders, and declared it advisable,
to enter into this Agreement, (b) approved the execution, delivery and
performance of this Agreement and the consummation of the transactions



 1
 









contemplated hereby, including the Merger, and (c)
resolved to recommend to its shareholders approval and adoption of this
Agreement.


WHEREAS, the ESOP Fiduciary, on behalf of the ESOP,
and the board of directors of Merger Sub have approved this Agreement and
declared it advisable for the ESOP and Merger Sub, respectively, to enter into
this Agreement.


WHEREAS, the ESOP, Merger Sub and the Company desire
to make certain representations, warranties, covenants and agreements specified
herein in connection with this Agreement.


NOW, THEREFORE, in consideration of the foregoing and
the representations, warranties, covenants and agreements contained herein, and
intending to be legally bound hereby, the ESOP, Merger Sub and the Company
agree as follows:


ARTICLE I


THE
MERGER


Section 1.1             The
Merger.  On the terms and subject to
the conditions set forth in this Agreement, and in accordance with the General
Corporation Law of the State of Delaware (the “DGCL”), at the Effective
Time (as hereinafter defined), Merger Sub will merge with and into the Company,
the separate corporate existence of Merger Sub will cease and the Company will
continue its corporate existence under Delaware law as the surviving
corporation in the Merger (the “Surviving Corporation”).


Section 1.2             Closing.  The closing of the Merger (the “Closing”)
shall take place at the offices of Wachtell, Lipton, Rosen & Katz, 51 West
52nd Street, New York, New York at 10:00 a.m.,
local time, on a date to be specified by the parties (the “Closing Date”)
which shall be no later than the third business day after the satisfaction or
waiver (to the extent permitted by applicable Law (as hereinafter defined)) of
the conditions set forth in Article VI (other than those conditions that by
their nature are to be satisfied at the Closing, but subject to the satisfaction
or waiver of such conditions), or at such other place, date and time as the
Company and the ESOP may agree in writing.


Section 1.3             Effective
Time.  Subject to the provisions of
this Agreement, at the Closing, the Company will cause a certificate of merger
in a form reasonably satisfactory to the ESOP and Tribune Acquisition (the “Certificate
of Merger”) to be executed, acknowledged and filed with the Secretary of
State of the State of Delaware in accordance with Section 251 of the DGCL.  The Merger will become effective at such time
as the Certificate of Merger has been duly filed with the Secretary of State of
the State of Delaware or at such later date or time as may be agreed by the
Company and Merger Sub in writing and specified in the Certificate of Merger in
accordance with the DGCL (the effective time of the Merger being hereinafter
referred to as the “Effective Time”).


Section 1.4             Effects
of the Merger.  The Merger shall have
the effects set forth in this Agreement and the applicable provisions of the
DGCL.  Without limiting the generality of
the foregoing, and subject thereto, from and after the Effective Time, all
property, rights,



 2
 









privileges, immunities, powers, franchises, licenses and authority of
the Company and Merger Sub shall vest in the Surviving Corporation, and all
debts, liabilities, obligations, restrictions and duties of each of the Company
and Merger Sub shall become the debts, liabilities, obligations, restrictions
and duties of the Surviving Corporation. 
At and after the Effective Time, the officers and directors of the
Surviving Corporation shall be authorized to execute and deliver, in the name
and on behalf of the Company, its Subsidiaries or Merger Sub, any deeds, bills
of sale, assignments or assurances and to take and do, in the name and on
behalf of the Company, its Subsidiaries or Merger Sub, any other actions and
things to vest, perfect or confirm of record or otherwise in the Surviving
Corporation any and all right, title and interest in, to and under any of the
rights, properties or assets of the Company, its Subsidiaries and Merger Sub.


Section 1.5             Certificate
of Incorporation and By-laws of the Surviving Corporation.  Subject to Section 5.9, at the Effective
Time, (a) the Certificate of Incorporation of the Surviving Corporation shall
be amended to read in its entirety as the Certificate of Incorporation of
Merger Sub read immediately prior to the Effective Time, in the form attached
hereto as Exhibit A, except that the name of the Surviving Corporation
shall be Tribune Company and the provision in the Certificate of Incorporation
of Merger Sub naming its incorporator shall be omitted, and (b) the bylaws of
the Surviving Corporation shall be amended so as to read in their entirety as
the bylaws of Merger Sub as in effect immediately prior to the Effective Time,
in the form attached hereto as Exhibit B, with such changes as may be
necessary to comply with any applicable Law or the rules and regulations of any
national securities exchange, in each case, until thereafter amended in
accordance with applicable Law, except the references to Merger Sub’s name
shall be replaced by references to Tribune Company.


Section 1.6             Directors.  Subject to applicable Law, the directors of
Merger Sub as of the Effective Time shall be the initial directors of the
Surviving Corporation and shall hold office until their respective successors
are duly elected and qualified, or their earlier death, resignation or removal.


Section 1.7             Officers.  The officers of the Company as of the
Effective Time shall be the initial officers of the Surviving Corporation and
shall hold office until their respective successors are duly elected and
qualified, or their earlier death, resignation or removal.


ARTICLE
II


CONVERSION
OF SHARES; EXCHANGE OF CERTIFICATES


Section 2.1             Effect
on Capital Stock.  At the Effective
Time, by virtue of the Merger and without any action on the part of the
Company, Merger Sub or the holders of any securities of the Company or Merger
Sub:


(a)           Conversion
of Company Common Stock.  Each share
of Common Stock, par value $.01 per share, of the Company outstanding
immediately prior to the Effective Time (such shares, collectively, “Company
Common Stock,” and each, a “Share”), other than (i) Shares to
be cancelled pursuant to Section 2.1(b) and (ii) Dissenting Shares (as
hereinafter defined), shall be converted automatically into and shall
thereafter represent the right to receive



 3
 









Thirty-four Dollars ($34.00) in cash plus the Additional Per Share
Consideration (the “Merger Consideration”).  The “Additional Per Share Consideration”
shall mean an amount per share, if any, rounded to the nearest whole cent,
equal to (1) Thirty-four Dollars ($34) multiplied by (2) eight
percent (8%) multiplied by (3) the Annualized Portion (as hereinafter
defined).  The “Annualized Portion”
shall mean the quotient obtained by dividing (x) the number of days actually
elapsed from and excluding January 1, 2008 to and including the Closing
Date by (y) 365.  All Shares that
have been converted into the right to receive the Merger Consideration as
provided in this Section 2.1 shall be automatically cancelled and shall cease
to exist, and the holders of certificates which immediately prior to the
Effective Time represented such Shares shall cease to have any rights with
respect to such Shares other than the right to receive the Merger
Consideration.


(b)           ESOP
and Merger Sub-Owned Shares.  Each
Share that is owned, directly or indirectly, by the ESOP or Merger Sub
immediately prior to the Effective Time or held by the Company immediately
prior to the Effective Time (in each case, other than any such Shares held on
behalf of third parties) (the “Cancelled Shares”) shall be cancelled and
retired and shall cease to exist, and no consideration shall be delivered in
exchange for such cancellation and retirement.


(c)           Treatment
of Company Preferred Stock.  Each
share of Series E Preferred Stock of the Company that is owned immediately
prior to the Effective Time by an Eagle Entity, which shares constitute all the
outstanding shares of Series E Preferred Stock, shall remain outstanding
following the Merger in accordance with their terms.


(d)           Conversion
of Merger Sub Common Stock.  All the
shares of common stock, par value $.01 per share, of Merger Sub issued and
outstanding immediately prior to the Effective Time shall be converted into and
become, in the aggregate, 56,521,739 validly issued, fully paid and
nonassessable shares of common stock, par value $.01 per share, of the
Surviving Corporation with the same rights, powers and privileges as the shares
so converted and, together with the shares of Series E Preferred Stock referred
to above in Section 2.1(c), shall constitute the only outstanding shares of
capital stock of the Surviving Corporation. 
From and after the Effective Time, all certificates representing the
common stock of Merger Sub shall be deemed for all purposes to represent the
number of shares of common stock of the Surviving Corporation into which they
were converted in accordance with the immediately preceding sentence.


(e)           Dissenters’
Rights.  Notwithstanding any
provision of this Agreement to the contrary, if required by the DGCL (but only
to the extent required thereby), Shares that are issued and outstanding
immediately prior to the Effective Time (other than Cancelled Shares) and that
are held by holders of such Shares who have not voted in favor of the adoption
of this Agreement or consented thereto in writing and who have properly
exercised appraisal rights with respect thereto in accordance with, and who
have complied with, Section 262 of the DGCL (the “Dissenting Shares”)
will not be converted into the right to receive the Merger Consideration, and
holders of such Dissenting Shares will be entitled to receive payment of the
fair value of such Dissenting Shares in accordance with the provisions of such
Section 262 unless and until any such holder fails to perfect or effectively
waives, withdraws or loses its rights to appraisal and payment under the
DGCL.  If, after the Effective Time, any
such holder fails to perfect or effectively waives, withdraws or loses such
right, such Shares shall not be deemed Dissenting Shares and will thereupon be
treated as if they had been converted into and have become



 4
 









exchangeable for, at the Effective Time, the right to receive the
Merger Consideration, without any interest thereon, and the Surviving
Corporation shall remain liable for payment of the Merger Consideration for
such Shares.  At the Effective Time, any
holder of Dissenting Shares shall cease to have any rights with respect thereto,
except the rights provided in Section 262 of the DGCL and as provided in the
previous sentence.  Any portion of the
Merger Consideration made available to the Paying Agent pursuant to
Section 2.2 to pay for Dissenting Shares for which appraisal rights have
been perfected shall be paid to the Surviving Corporation upon demand.  The Company will give the ESOP (i) prompt
notice of any demands received by the Company for appraisals of Shares,
withdrawals of such demands, and any other instruments served pursuant to the
DGCL and received by the Company that relate to any such demand for dissenters’
rights and (ii) the opportunity to participate in and direct all negotiations
and proceedings with respect to such notices and demands.  The Company shall not, except with the prior
written consent of the ESOP, make any payment with respect to any demands for
appraisal or settle or offer to settle any such demands.


(f)            Adjustments.  If at any time during the period between the
date of this Agreement and the Effective Time, any change in the outstanding
shares of capital stock of the Company shall occur as a result of any
reclassification, recapitalization, stock split (including a reverse stock
split) or combination, exchange or readjustment of shares, or any stock
dividend or stock distribution is declared with a record date during such
period, the Merger Consideration shall be equitably adjusted to reflect such
change.


Section 2.2             Exchange
of Certificates.


(a)           Paying
Agent.  At or prior to the Effective
Time, the Company shall deposit, or shall cause to be deposited, with a U.S.
bank or trust company to act as a paying agent hereunder pursuant to an
agreement customary in form and substance (the “Paying Agent”), in trust
for the benefit of holders of the Shares, the Company Stock Options (as
hereinafter defined) and the Company Stock-Based Awards (as hereinafter
defined), cash in U.S. dollars sufficient to pay (i) the aggregate Merger
Consideration in exchange for all of the Shares outstanding immediately prior
to the Effective Time (other than the Cancelled Shares), payable upon due
surrender of the certificates that immediately prior to the Effective Time
represented Shares (“Certificates”) (or effective affidavits of loss in
lieu thereof) or non-certificated Shares represented by book-entry (“Book-Entry
Shares”) pursuant to the provisions of this Article II and (ii) the Option
and Stock-Based Consideration (as hereinafter defined) payable pursuant to
Section 5.5 (such cash referred to in subsections (a)(i) and (a)(ii) being
hereinafter referred to as the “Exchange Fund”).


(b)           Payment
Procedures.


(i)            As
soon as reasonably practicable after the Effective Time and in any event not
later than the second business day following the Effective Time, the Paying
Agent shall mail (x) to each holder of record of Shares whose Shares were
converted into the Merger Consideration pursuant to Section 2.1, (A) a
letter of transmittal (which shall specify that delivery shall be effected, and
risk of loss and title to Certificates shall pass, only upon delivery of
Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry
Shares to the Paying Agent and shall be in such form and have such other
provisions as the ESOP and the Company



 5
 









may mutually agree), and (B) instructions for use in effecting the
surrender of Certificates (or effective affidavits of loss in lieu thereof) or
Book-Entry Shares in exchange for the Merger Consideration and (y) upon
surrender of such documents as may reasonably be required by the Paying Agent,
to each holder of a Company Stock Option or a Company Stock-Based Award, a
check in an amount, if any, due and payable to such holder pursuant to Section
5.5 hereof in respect of such Company Stock Option or Company Stock-Based
Award.


(ii)           Upon
surrender of Certificates (or effective affidavits of loss in lieu thereof) or
Book-Entry Shares to the Paying Agent together with such letter of transmittal,
duly completed and validly executed in accordance with the instructions
thereto, and such other documents as may reasonably be required by the Paying
Agent, the holder of such Certificates or Book-Entry Shares shall be entitled
to receive in exchange therefor a check in an amount equal to the product of
(x) the number of Shares represented by such holder’s properly surrendered
Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry
Shares multiplied by (y) the Merger Consideration.  No interest will be paid or accrued on any
amount payable upon due surrender of Certificates or Book-Entry Shares.  In the event of a transfer of ownership of
Shares that is not registered in the transfer records of the Company, a check
for any cash to be paid upon due surrender of the Certificate may be paid to
such a transferee if the Certificate formerly representing such Shares is
presented to the Paying Agent, accompanied by all documents required to
evidence and effect such transfer and to evidence that any applicable stock
transfer Taxes (as hereinafter defined) have been paid or are not applicable.


(iii)          The
Paying Agent or the Surviving Corporation shall be entitled to deduct and
withhold from the consideration otherwise payable under this Agreement to any
holder of Shares or holder of Company Stock Options or Company Stock-Based
Awards, such amounts as are required to be withheld or deducted under the
Internal Revenue Code of 1986 (the “Code”) or any provision of
applicable Federal, state, local or foreign Tax Law with respect to the making
of such payment.  To the extent that
amounts are so withheld or deducted and paid over to the applicable
Governmental Entity (as hereinafter defined), such withheld or deducted amounts
shall be treated for all purposes of this Agreement as having been paid to the
holder of the Shares or holder of the Company Stock Options or Company
Stock-Based Awards, in respect of which such deduction and withholding were
made.


(c)           Closing
of Transfer Books.  At the Effective
Time, the stock transfer books of the Company shall be closed, and there shall
be no further registration of transfers on the stock transfer books of the
Surviving Corporation of the Shares that were outstanding immediately prior to
the Effective Time.  If, after the
Effective Time, Certificates are presented to the Surviving Corporation for
transfer, they shall be cancelled and exchanged for a check in the proper
amount pursuant to this Article II.


(d)           Termination
of Exchange Fund.  Any portion of the
Exchange Fund (including the proceeds of any investments thereof) that remains
undistributed to the former holders of Shares for one year after the Effective
Time shall be delivered to the Surviving Corporation upon demand, and any
former holders of Shares who have not surrendered their Shares in accordance
with Section 2.2 shall thereafter look only to the Surviving Corporation as
general unsecured creditors of the Surviving Corporation for payment of their
claim for the Merger Consideration, without any interest thereon, upon due
surrender of their Shares.



 6
 









 


(e)           No
Liability.  Notwithstanding anything
herein to the contrary, none of the Company, the ESOP, Merger Sub, the
Surviving Corporation, the Paying Agent or any other person shall be liable to
any former holder of Shares for any amount properly delivered to a public
official pursuant to any applicable abandoned property, escheat or similar Law.


(f)            Investment
of Exchange Fund.  The Paying Agent
shall invest all cash included in the Exchange Fund as reasonably directed by
the Company; provided, however, that any investment of such cash
shall be limited to direct short-term obligations of, or short-term obligations
fully guaranteed as to principal and interest by, the U.S. government, or
commercial paper obligations receiving the highest rating from either Moody’s
Investor Services, Inc. or Standard & Poor’s Corporation, a division of The
McGraw Hill Companies, or in certificates of deposit, bank repurchase
agreements or banker’s acceptances of commercial banks with capital exceeding
$1 billion (based on the most recent financial statements of such bank that are
then publicly available), or a combination thereof.  Any interest and other income resulting from
such investments shall be paid to the Surviving Corporation pursuant to Section
2.2(d).


(g)           Lost
Certificates.  In the case of any
Certificate that has been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the person claiming such Certificate to be lost,
stolen or destroyed and, if required by the Surviving Corporation, the posting
by such person of a bond in customary amount as indemnity against any claim
that may be made against it with respect to such Certificate, the Paying Agent
will issue in exchange for such lost, stolen or destroyed Certificate a check
in the amount of the number of Shares represented by such lost, stolen or
destroyed Certificate multiplied by the Merger Consideration.


ARTICLE
III


REPRESENTATIONS
AND WARRANTIES OF THE COMPANY


Except as disclosed in the Company SEC Documents (as
hereinafter defined) filed prior to the date hereof, other than risk factor and
similar cautionary disclosure contained in the Company SEC Documents under the
headings “Risk Factors” or “Forward-Looking Statements” or under any other
similar heading, or as disclosed in the disclosure schedule delivered by the
Company to the ESOP immediately prior to the execution of this Agreement (the “Company
Disclosure Schedule”), the Company represents and warrants to the ESOP and
Merger Sub as follows:


Section 3.1             Qualification, Organization,
Subsidiaries, etc.   Each of the
Company and its Subsidiaries and, to the knowledge of the Company, each Company
Joint Venture is a legal entity duly organized, validly existing and in good
standing under the Laws of its respective jurisdiction of organization and has
all requisite corporate or similar power and authority to own, lease, hold and
operate its properties and assets and to carry on its business as presently
conducted and is qualified to do business and is in good standing as a foreign
corporation in each jurisdiction where the ownership, leasing, holding or operation
of its assets or properties or conduct of its business requires such
qualification, except where the failure to be so organized, validly existing,
qualified or in good standing, or to have such power or authority, would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect.  As used in this
Agreement, “Company Joint Venture” means CareerBuilder,



 7
 









LLC, ShopLocal, LLC, Topix LLC, Television
Food Network, G.P., Comcast SportsNet Chicago, LLC, Eagle New Media
Investments, LLC (“Eagle New Media”), and Eagle Publishing Investments,
LLC (“Eagle Publishing” and together with Eagle New Media, the “Eagle
Entities”).  As used in this
Agreement, any reference to any facts, circumstances, events or changes having
a “Company Material Adverse Effect” means any facts, circumstances,
events or changes that are materially adverse to the business, assets,
financial condition, results of operations on an ongoing basis or continuing
operations of the Company and its Subsidiaries, taken as a whole, or
that have a material adverse effect on the ability of the Company to
perform its obligations under this Agreement, or to consummate the Merger and
the other transactions to be performed or consummated by the Company; provided,
however that “Company Material Adverse Effect” shall not include facts,
circumstances, events or changes resulting from (a) changes in general economic
or political conditions or the securities, credit or financial markets in
general, (b) general changes or developments in the industries in which
the Company and its Subsidiaries operate, including general changes in law or
regulation across such industries, (c) the announcement of this Agreement or
the pendency or consummation of the Merger, (d) compliance with the terms of,
or the taking of any action required by, this Agreement or consented to by
Tribune Acquisition and the ESOP, (e) any acts of terrorism or war (other
than any of the foregoing that causes any damage or destruction to or renders
unusable any facility or property of the Company or any of its Subsidiaries),
(f) the identity of Tribune Acquisition or the ESOP or any of their affiliates
as participants in the transactions contemplated by this Agreement or the other
agreements described in the recitals hereof or (g) changes in GAAP or the
interpretation thereof by the Financial Accounting Standards Board, the
Accounting Principles Board, the American Institute of Certified Public
Accountants and other similar organizations generally considered authoritative
with respect to the interpretation of GAAP, except, in the case of the
foregoing clauses (a) and (b), to the extent such facts, circumstances, events,
changes or developments referred to therein have a disproportionate impact on
the Company and its Subsidiaries, taken as a whole, relative to other companies
in the industries or in the geographic markets in which the Company conducts
its businesses after taking into account the size of the Company relative to
such other companies.  For the avoidance
of doubt, the parties agree that any decline in the stock price of the Company
Common Stock on the New York Stock Exchange or any failure to meet internal or
published projections, forecasts or revenue or earning predictions for any
period shall not, in and of itself, constitute a Company Material Adverse
Effect, but the underlying causes of such decline or failure shall be
considered to the extent applicable (and subject to the proviso set forth in
the immediately preceding sentence) in determining whether there is a Company
Material Adverse Effect.  The Company has
made available to the ESOP prior to the date of this Agreement a true and
complete copy of the Company’s amended and restated certificate of
incorporation and by-laws and the charter and comparable organizational
documents of each Company Joint Venture, each as amended through the date
hereof.  The amended and restated
certificate of incorporation and by-laws of the Company are in full force and
effect, and the certificate of incorporation and by-laws or similar
organizational documents of each Subsidiary of the Company and, to the
knowledge of the Company, each Company Joint Venture are in full force and
effect.  Neither the Company nor any
Subsidiary nor, to the knowledge of the Company, any Company Joint Venture is
in material violation of any provision of its certificate of incorporation or
by-laws or similar organizational documents.



 8
 









Section 3.2             Capital
Stock.


(a)           The authorized capital stock of the Company consists of
1,400,000,000 shares of Company Common Stock and 12,000,000 shares of preferred
stock, without par value (“Company Preferred Stock”), of which 6,000,000
shares are designated as Series A Junior Participating Preferred Stock and
380,972 shares are designated as Series D-1 Preferred Stock (the “Series D-1
Preferred Stock”).  At the close of
business on March 14, 2007, (i) 388,098,408 shares of Company Common
Stock were issued and outstanding (including 18,000 Restricted Shares),
(ii) 87,035,996 shares of Company Common Stock were held in treasury,
(iii) 60,671,319 shares of Company Common Stock were held by the Eagle
Entities, (iv) 32,853,240 shares of Company Common Stock were reserved for
issuance under the employee and director stock plans of the Company or of the
former Times Mirror Company (the “Company Stock Plans”) and (v) 137,643
shares of Series D-1 Preferred Stock were issued and outstanding and held by
the Eagle Entities.  All outstanding
shares of Company Common Stock and Company Preferred Stock, and all shares of
Company Common Stock reserved for issuance as noted in clause (iv), when issued
in accordance with the respective terms thereof, are or will be duly
authorized, validly issued, fully paid and non-assessable and free of
pre-emptive rights and all Liens.  As of immediately prior to the
Effective Time, there will be (i) no shares of Series D-1 Preferred Stock
issued and outstanding and (ii) issued and outstanding shares of Series E  Preferred Stock, all of which will be held by the Eagle
Entities, as contemplated by that certain Exchange Agreement by and among the
Company, Eagle New Media and Eagle Publishing (the “Exchange Agreement”).  Such Series E Preferred Stock, when issued in
accordance with the terms of the Exchange Agreement, will be fully authorized,
validly issued, fully paid and non-assessable and free of pre-emptive rights
and all Liens.


(b)           Section 3.2(b) of the Company Disclosure Schedule
sets forth as of March 14, 2007, a complete and correct list of all
outstanding Company Stock-Based Awards, Restricted Shares, Company Stock
Options and each right of any kind, contingent or accrued, to receive shares of
Company Common Stock or benefits measured in whole or in part by the value of a
number of shares of Company Common Stock granted under the Company Stock Plans,
Company Benefit Plans or otherwise (including restricted stock units, phantom
units, deferred stock units and dividend equivalents), the number of shares of
Company Common Stock issuable thereunder or with respect thereto and the
exercise price (if any) and the Company has granted no other such awards since
March 14, 2007 and prior to the date hereof.  Each grant of a Company Stock Option was duly
authorized no later than the date on which the grant of such Company Stock
Option was by its terms to be effective by all necessary corporate action,
including any required shareholder approval by the necessary number of votes or
written consents, and each such grant was made in all material respects in
accordance with the terms of the applicable compensation plan or arrangement of
the Company, the Exchange Act, and all other applicable Laws and regulatory
rules or requirements, including the rules of the New York Stock Exchange.  The per share exercise price of each Company
Stock Option was equal to the fair market value (as such term is defined in the
applicable Company Stock Plan) of a share of Company Common Stock on the
applicable grant date.  The Company has
not knowingly granted, and there is no and has been no Company policy or
intentional practice to grant, Company Stock Options prior to, or otherwise
intentionally coordinate the grant of Company Stock Options with, the release
or other public announcement of material information regarding



 9
 









the Company or its Subsidiaries or their
financial results or prospects.  No
outstanding Company Stock Option is intended to qualify as an “incentive stock
option” under Section 422 of the Code.


(c)           All outstanding shares of capital stock of, or other
equity interests in, each Subsidiary of the Company are duly authorized,
validly issued, fully paid and non-assessable, were not issued in violation of
any preemptive or similar rights, purchase option, call or right of first
refusal or similar rights, and are owned by the Company or by a wholly owned
Subsidiary of the Company, free and clear of all Liens.  To the knowledge of the Company, all of the
outstanding ownership interests in each of the Company Joint Ventures are duly
authorized, validly issued, fully paid and nonassessable, and were not issued
in violation of any preemptive or similar rights, purchase option, call or
right of first refusal or similar rights. 
All the outstanding shares of capital stock of, or other equity
interests in, each Company Joint Venture that are owned by the Company or a
wholly owned Subsidiary of the Company, are owned free and clear of all Liens.


(d)           Except as set forth in subsection (a) above, as of the
date hereof, (i) the Company does not have any shares of its capital stock or
other voting securities issued or outstanding other than shares of Company
Common Stock that have become outstanding after March 14, 2007, which were
reserved for issuance as of March 14, 2007 as set forth in subsection (a)
above with respect to awards outstanding as of such date under Company Stock
Plans, and (ii) there are no outstanding subscriptions, options, warrants,
calls, convertible or exchangeable securities, or other similar rights,
undertakings, agreements or commitments of any kind to which the Company or any
of the Company’s Subsidiaries is a party obligating the Company or any of the
Company’s Subsidiaries to (A) issue, transfer or sell, or cause to be
issued, transferred or sold, any shares of capital stock or other equity
interests of the Company or any Subsidiary of the Company or securities
convertible into or exchangeable for such shares or equity interests,
(B) issue, grant, extend or enter into any such subscription, option,
warrant, call, convertible securities or other similar right, undertaking,
agreement or arrangement, (C) repurchase, redeem or otherwise acquire any
such shares of capital stock or other equity interests, (D) provide a
material amount of funds to, or make any material investment (in the form of a
loan, capital contribution or otherwise) in, any Subsidiary or Company Joint
Venture or (E) give any person the right to receive any economic benefit
or right similar to or derived from the economic benefits and rights occurring
to holders of Company Common Stock. 
Except for the issuance of shares of Company Common Stock that were
reserved for issuance as set forth in subsection (a) above, and except for
regular quarterly cash dividends, from March 9, 2007 to the date hereof,
the Company has not declared or paid any dividend or distribution in respect of
the Company Common Stock, and has not issued, sold, repurchased, redeemed or
otherwise acquired any Company Common Stock, and its Board of Directors has not
authorized any of the foregoing.


(e)           Except for awards to acquire or receive shares of Company
Common Stock under a Company Stock Plan, neither the Company nor any of its
Subsidiaries has outstanding bonds, debentures, notes or other obligations, the
holders of which have the right to vote (or which are convertible into or
exercisable for securities having the right to vote) with the shareholders of
the Company on any matter.



 10
 









 


(f)            There are no voting trusts or other agreements or
understandings to which the Company or any of its Subsidiaries is a party with
respect to the voting of the capital stock or other equity interest of the
Company or any of its Subsidiaries.


Section 3.3             Corporate Authority Relative to
This Agreement; No Violation.


(a)           The Company has all requisite corporate power and
authority to enter into this Agreement and, subject to receipt of the Company
Shareholder Approval (as hereinafter defined) in the case of the Merger, to
consummate the Merger and the other transactions contemplated hereby.  The Board of Directors of the Company, acting
upon the recommendation of the Special Committee, at a duly held meeting has
(i) determined that it is fair to and in the best interests of the Company and
its shareholders, and declared it advisable, to enter into this Agreement,
(ii) approved the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby, including the
Merger, and (iii) resolved to recommend that the shareholders of the
Company approve the adoption of this Agreement (the “Recommendation”)
and directed that this Agreement and the Merger be submitted for consideration
of the shareholders of the Company at the Company Meeting (as hereinafter
defined).  Assuming the accuracy of the
representations and warranties of the ESOP and Merger Sub set forth in
Section 4.9, (i) the determinations, approvals and resolutions by the
Board of Directors of the Company are sufficient to render inapplicable to the
ESOP and Merger Sub and this Agreement, the Merger and the other transactions
contemplated hereby the restrictions on “business combinations” contained in
Section 203 of the DGCL and (ii) to the knowledge of the Company, no
other “fair price,” “moratorium,” “control share acquisition,” “business
combination” or other similar antitakeover statute or regulation enacted under
state or Federal laws in the United States applicable to the Company is
applicable to the ESOP and Merger Sub and this Agreement, the Merger or the
other transactions contemplated hereby. 
Except for the Company Shareholder Approval and the filing of the Certificate
of Merger with the Secretary of State of the State of Delaware, no other
corporate proceedings on the part of the Company are necessary to authorize
this Agreement or the consummation of the transactions contemplated
hereby.  This Agreement has been duly and
validly executed and delivered by the Company and, assuming this Agreement
constitutes the legal, valid and binding agreement of the ESOP and Merger Sub,
constitutes the legal, valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms.


(b)           The execution, delivery and performance by the Company of
this Agreement and the consummation of the Merger and the other transactions
contemplated by this Agreement by the Company do not and will not require any
consent, approval, license, authorization, order or permit of, action by,
filing with or notification to any Federal, state, local or foreign
governmental or regulatory agency, commission, court, body, entity or authority
(each, a “Governmental Entity”), other than (i) the filing of the
Certificate of Merger, (ii) compliance with the applicable requirements of
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR
Act”), (iii) compliance with the applicable requirements of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”),
including the filing of the Proxy Statement (as hereinafter defined) and the
Schedule 13E-3 (as hereinafter defined), (iv) compliance with the rules
and regulations of the New York Stock Exchange, (v) filings with the Federal
Communications Commission (the “FCC”), the FCC Order (as hereinafter
defined), and the state regulatory bodies (the “State Commissions”) set



 11
 









forth on Section 3.3(b) of the Company
Disclosure Schedule, (vi) compliance with any applicable foreign or state
securities or blue sky laws, (vii) such of the foregoing as may be required in
connection with the Financing, and (viii) the other consents and/or
notices set forth on Section 3.3(b) of the Company Disclosure Schedule
(collectively, clauses (i) through (viii), the “Company Approvals”), and
other than any consent, approval, authorization, permit, action, filing or
notification the failure of which to make or obtain would not reasonably be
expected to, individually or in the aggregate, (A) have a Company Material
Adverse Effect or (B) prevent or materially delay the consummation of the
Merger.  As used herein, “FCC Order”
means one or more orders or decisions of the FCC (or its staff) which grant all
consents or approvals required under the Communications Act of 1934, as amended
(the “Communications Act”) or the rules, regulations and published
policies of the FCC promulgated thereunder (the “FCC Rules”) for the
transfer of control or assignment of all FCC licenses, permits or other
authorizations held by the Company or any of its Subsidiaries to the ESOP,
Merger Sub or an affiliate of the ESOP or Merger Sub and the consummation of
the transactions contemplated by this Agreement, whether or not any (x) appeal
or request for reconsideration or review of such order is pending, or whether
the time for filing any such appeal or request for reconsideration or review,
or any sua sponte action by the FCC with similar effect, has expired or (y)
such order is subject to any condition or provision of law or regulation of the
FCC (whether such law or regulation is now existing or is proposed in any
proceeding pending at the time of receipt of the FCC Order).  There is not pending or, to the knowledge of
the Company, threatened by or before the FCC any proceeding, notice of
violation, order of forfeiture, complaint or investigation against or relating
to the Company, any of its Subsidiaries or a Company Station or, to the
knowledge of the Company, any Company Joint Venture, nor, to the knowledge of
the Company, is there any fact or circumstance related to the Company, any of
its Subsidiaries, any Company Joint Venture or a Company Station, that would
reasonably be expected to prevent the FCC from issuing the FCC Order.


(c)           The execution, delivery and performance by the Company of
this Agreement and the consummation by the Company of the Merger and the other
transactions contemplated hereby do not and will not (i) contravene or conflict
with the organizational or governing documents of the Company, any of its
Subsidiaries or any Company Joint Venture, (ii) assuming compliance with
the matters referenced in Section 3.3(b) and the receipt of the Company
Shareholder Approval, contravene or conflict with or constitute a violation of
any provision of any Law binding upon or applicable to the Company or any of
its Subsidiaries or any of their respective properties or assets,
(iii) assuming compliance with the matters referenced in Section 3.3(b),
conflict with, contravene, result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any material obligation or to the
loss of a material benefit under, or to increased, additional, accelerated or
guaranteed rights or entitlements of any person (other than employees of the
Company) under, any loan, guarantee of indebtedness or credit agreement, note,
bond, mortgage, indenture, lease, agreement, contract, instrument, permit,
concession, franchise, right or license to which the Company or any of the Company’s
Subsidiaries is a party or by which any of their respective properties or
assets is bound, or (iv) result in the creation of any liens, claims,
mortgages, encumbrances, pledges, security interests, equities or charges of
any kind (each, a “Lien”), other than any such Lien (A) for Taxes or
governmental assessments, charges or claims of payment not yet due, being
contested in good faith or for which adequate accruals or reserves have been
established on the most recent consolidated balance sheet included in



 12
 









Company SEC Documents filed prior to the date
hereof, (B) which is a carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s or other similar lien arising in the ordinary course of business,
(C) which is disclosed on the most recent consolidated balance sheet of the
Company or notes thereto or securing liabilities reflected on such balance
sheet or (D) which was incurred in the ordinary course of business since
the date of the most recent consolidated balance sheet of the Company (each of
the foregoing, a “Permitted Lien”), upon any of the properties or assets
of the Company or any of the Company’s Subsidiaries, other than, in the case of
clauses (ii) and (iii), any such items that would not reasonably be expected to
have, individually or in the aggregate, a Company Material Adverse Effect.


Section 3.4             Reports and Financial Statements.


(a)           The Company has filed or furnished all forms, documents
and reports required to be filed or furnished prior to the date hereof by it
with the Securities and Exchange Commission (the “SEC”) since December
25, 2005 (the “Company SEC Documents”). 
As of their respective dates, or, if amended, as of the date of the last
such amendment, the Company SEC Documents complied in all material respects
with the requirements of the Securities Act of 1933, as amended (the “Securities
Act”), and the Exchange Act, as the case may be, and the applicable rules
and regulations promulgated thereunder, and none of the Company SEC Documents
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.  None of the Subsidiaries of
the Company is, or at any time since December 25, 2005 has been, required
to file any form or report with the SEC.


(b)           The consolidated financial statements of the Company
included in the Company SEC Documents (including all related notes and
schedules, where applicable) fairly present in all material respects the
consolidated financial position of the Company and its consolidated
Subsidiaries, as at the respective dates thereof, and the consolidated results
of their operations and their consolidated cash flows for the respective periods
then ended (subject, in the case of the unaudited statements, to normal
year-end audit adjustments and to any other adjustments described therein,
including the notes thereto), in conformity with United States generally
accepted accounting principles (“GAAP”) (except, in the case of the
unaudited statements, as permitted by the SEC) applied on a consistent basis
during the periods involved (except as may be indicated therein or in the notes
thereto), and comply as to form with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto.  Since December 25, 2005, there has been
no material change in the Company’s accounting methods or principles that would
be required to be disclosed in the Company’s financial statements in accordance
with GAAP, except as described in the notes to such Company financial
statements.


(c)           To the knowledge of the Company, there is no applicable
accounting rule, consensus or pronouncement that, as of the date of this
Agreement, has been adopted by the SEC, the Financial Accounting Standards
Board or the Emerging Issues Task Force that is not in effect as of the date of
this Agreement but that, if implemented, could reasonably be expected to have a
Company Material Adverse Effect.



 13
 









 


Section 3.5             Internal Controls and Procedures.  The Company has established and maintains
disclosure controls and procedures and internal control over financial
reporting (as such terms are defined in paragraphs (e) and (f), respectively,
of Rule 13a-15 under the Exchange Act) as required by Rule 13a-15 under the
Exchange Act.  The Company’s disclosure
controls and procedures are reasonably designed to ensure that all material
information required to be disclosed by the Company in the reports that it
files or furnishes under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of the
SEC, and that all such material information is accumulated and communicated to
the Company’s management as appropriate to allow timely decisions regarding
required disclosure and to make the certifications required pursuant to
Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley
Act”).  The Company’s management has
completed an assessment of the effectiveness of the Company’s internal control
over financial reporting in compliance with the requirements of Section 404 of
the Sarbanes-Oxley Act for the year ended December 31, 2006, and such
assessment concluded that such controls were effective.


Section 3.6             No Undisclosed Liabilities.  Except (a) as reflected or reserved
against in the Company’s most recent consolidated balance sheet (or the notes
thereto) included in the Company SEC Documents, (b) as expressly permitted
or contemplated by this Agreement, (c) for liabilities and obligations
incurred in the ordinary course of business since December 31, 2006 and
(d) for liabilities or obligations which have been discharged or paid in
full in the ordinary course of business, as of the date hereof, neither the
Company nor any Subsidiary of the Company has any liabilities or obligations of
any nature, whether or not accrued, absolute, contingent or otherwise, that
would be required by GAAP to be reflected on a consolidated balance sheet of
the Company and its Subsidiaries (or in the notes thereto), other than those
that would not reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect.


Section 3.7             Compliance with Law; Permits.


(a)           The Company, each of the Company’s Subsidiaries, their
relevant personnel and operations and, to the knowledge of the Company, each of
the Company Joint Ventures are, and since December 31, 2006, have been, in
compliance with and are not in default under or in violation of any applicable
federal, state, local or foreign law, statute, ordinance, rule, regulation,
judgment, order, injunction, decree or agency requirement of any Governmental
Entity (collectively, “Laws” and each, a “Law”), except where
such non-compliance, default or violation would not reasonably be expected to
have, individually or in the aggregate, a Company Material Adverse Effect.  Notwithstanding anything contained in this
Section 3.7(a), no representation or warranty shall be deemed to be made
in this Section 3.7(a) in respect of the matters referenced in
Sections 3.4 or 3.5, or in respect of environmental, Tax, employee
benefits or labor Law matters, each of which matters is addressed by other
sections of this Agreement.


(b)           The Company, the Company’s Subsidiaries and, to the
knowledge of the Company, each of the Company Joint Ventures are in possession
of and have in effect all franchises, grants, authorizations, licenses, permits
(other than the Company FCC Licenses), easements, variances, exceptions,
consents, certificates, approvals and orders of any Governmental Entity
necessary for the Company and the Company’s Subsidiaries to own, lease



 14
 









and operate their properties and assets or to
carry on their businesses as they are now being conducted (the “Company
Permits”), and no non-renewal, suspension, cancellation or materially
adverse modification of any of the Company Permits is pending or, to the
knowledge of the Company, threatened, except where the failure to have any of
the Company Permits or the suspension, cancellation or materially adverse
modification of any of the Company Permits would not reasonably be expected to
have, individually or in the aggregate, a Company Material Adverse Effect, and
there has occurred no violation of, default (with or without the lapse or time
or the giving of notice, or both) under, or event giving to others any right of
termination, amendment or cancellation of, with or without notice or lapse of
time or both, any such Company Permit, except as would not reasonably be
expected to have, individually or in the aggregate, a Company Material Adverse
Effect.  All Company Permits are in full
force and effect in accordance with their terms and, to the Company’s
knowledge, there is no event which would reasonably be expected to result in
the revocation, cancellation, non-renewal or adverse modification of any such
Company Permit, except where the failure to be in full force and effect, or
where such revocation, cancellation, non-renewal or adverse modification, would
not reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect.


(c)           Section
3.7(c) of the Company Disclosure Schedule sets forth (i) all main
television and radio station licenses, permits, authorizations and approvals
issued by the FCC to the Company or any of its Subsidiaries for the operation
of the Company Stations (“Company FCC Licenses”) and the legal name of
the entity to which each such Company FCC License was issued and (ii) all
time brokerage agreements and joint sales agreements between the Company or any
of its Subsidiaries and any other broadcast licensee with respect to any
broadcast television or radio station. 
The Company FCC Licenses are in full force and effect in accordance with
their terms in all material respects and are not subject to any material
conditions except for conditions applicable to television or radio broadcast
licenses generally or as otherwise disclosed on the face of the Company FCC
Licenses.  The Company and its
Subsidiaries have constructed and operated and currently are constructing and
operating the Company Stations in material compliance with the terms of the
Company FCC Licenses, the Communications Act, the FCC Rules and applicable
requirements of the Federal Aviation Administration (the “FAA”).  Without limiting the generality of the
foregoing, the Company and its Subsidiaries have timely filed or made all
applications, reports and other disclosures required by the FCC or FAA to be
filed or made with respect to the Company Stations and have timely paid all FCC
regulatory fees with respect to the Company Stations, except for such
noncompliance, failure to file or failure to pay as would not, individually or
in the aggregate, reasonably be expected to have a Company Material Adverse
Effect.  The Company and its Subsidiaries
hold all Company FCC Licenses necessary for the Company and its Subsidiaries to
construct and operate the Company Stations as they are now being constructed
and operated, and no suspension, cancellation or adverse modification of any of
the Company FCC Licenses is pending or, to the knowledge of the Company,
threatened, except where the failure to have any of the Company FCC Licenses or
the non-renewal, suspension, cancellation or materially adverse modification of
any of the Company FCC Licenses would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect.  There is not pending or, to the knowledge of
the Company, threatened by or before the FCC any proceeding, notice of
violation, order of forfeiture, complaint or investigation against or relating
to the Company, any of its Subsidiaries, any Company Station or, to the
knowledge of the Company, any Company Joint Venture, except for



 15














any such proceedings, notices, orders, complaints or investigations
that would not, individually or in the aggregate, reasonably be expected to
have a Company Material Adverse Effect. 
There is no order of forfeiture or notice of liability issued by the FCC
with respect to the Company, any of its Subsidiaries, any Company Station or,
to the knowledge of the Company, any Company Joint Venture that has not been
satisfied.  As used herein, “Company
Station” shall mean each radio broadcast and television station currently
owned and operated by the Company or any of its Subsidiaries, including full
power radio and television broadcast stations and low power television and
television translator stations.


(d)           The
transmission towers and other transmission facilities of the Company Stations
have been maintained in a manner consistent in all material respects with
generally accepted standards of good engineering practice.  To the knowledge of the Company, no Company
Station causes interference in violation of the Communications Act or the FCC
Rules to the transmission of any other broadcast station or communications
facility.


(e)           Neither
the Company nor any of its Subsidiaries has leased, licensed, assigned,
conveyed or otherwise encumbered any portion of the digital spectrum of a
Company Station or granted rights to any party to broadcast on any portion of
the digital spectrum of a Company Station.


Section 3.8             Environmental
Laws and Regulations.


(a)           Except
as would not, individually or in the aggregate, reasonably be expected to have
a Company Material Adverse Effect, (i) the Company and its Subsidiaries
have conducted their respective businesses in compliance with all applicable
Environmental Laws (as hereinafter defined), (ii) none of the properties
owned, leased or operated by the Company or any of its Subsidiaries contains
any Hazardous Substance (as hereinafter defined) as a result of any activity of
the Company or any of its Subsidiaries in amounts exceeding the levels allowed
or otherwise permitted by applicable Environmental Laws, (iii) since
December 31, 2006, neither the Company nor any of its Subsidiaries has
received any notices, demand letters or requests for information from any
federal, state, local or foreign Governmental Entity indicating that the
Company or any of its Subsidiaries may be in violation of, or liable under, any
Environmental Law in connection with the ownership or operation of its
businesses or any of their respective properties or assets, (iv) there
have been no Releases or transportation of any Hazardous Substance at, onto, or
from any properties presently or formerly owned, leased or operated by the
Company or any of its Subsidiaries as a result of any activity of the Company
or any of its Subsidiaries during the time such properties were owned, leased
or operated by the Company or any of its Subsidiaries and (v) neither the
Company, its Subsidiaries nor any of their respective properties are subject to
any liabilities relating to any suit, settlement, court order, administrative
order, regulatory requirement, judgment, notice of violation or written claim
asserted or arising under any Environmental Law.  It is agreed and understood that no
representation or warranty is made in respect of environmental matters in any
Section of this Agreement other than this Section 3.8.


(b)           As
used herein, “Environmental Law” means any Law relating to (x) the
protection, preservation or restoration of human health or the environment
(including air, water vapor, surface water, groundwater, drinking water supply,
surface land, subsurface land, plant or 



 16
 








animal life, or any other natural resource), (y) the exposure to,
or the use, storage, recycling, treatment, generation, transportation,
processing, handling, labeling, production, Release or disposal of Hazardous
Substances, in each case as in effect at the date hereof, or (z) the protection
of worker health or safety.


(c)           As
used herein, “Hazardous Substance” means any substance, element,
compound, mixture, solution, and/or waste presently listed, defined, designated,
identified, or classified as hazardous, toxic, radioactive, or dangerous, or
otherwise regulated, under any Environmental Law.  Hazardous Substance includes any substance,
element, compound, mixture, solution and/or waste to which exposure is regulated
by any Governmental Entity or any Environmental Law, including but not limited
to any toxic waste, pollutant, contaminant, hazardous substance (including
toxic mold), toxic substance, hazardous waste, special waste, industrial
substance or petroleum or any derivative or byproduct thereof, radon,
radioactive material, asbestos, or asbestos containing material, urea
formaldehyde, foam insulation or polychlorinated biphenyls.


(d)           As
used herein, “Release” means any releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, storing, escaping, leaching,
migrating, dumping, discarding, burying, abandoning or disposing into the
environment of a Hazardous Substance, in each case, in violation of any
Environmental Law or in a manner which has or may give rise to any liability
under any Environmental Law.


Section 3.9             Employee
Benefit Plans.


(a)           Section 3.9(a)
of the Company Disclosure Schedule lists all material Company Benefit
Plans.  “Company Benefit Plans”
means all employee or director benefit plans, programs, policies, agreements or
other arrangements, including any employee welfare plan within the meaning of
Section 3(1) of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), any employee pension benefit plan within the meaning
of Section 3(2) of ERISA (whether or not such plan is subject to ERISA), and
any bonus, incentive, deferred compensation, vacation, stock purchase, stock
option or other equity-based plan or arrangement, severance, employment, change
of control or fringe benefit plan, program or agreement (other than any “multiemployer
plan” within the meaning of Section 4001(a)(3) of ERISA and any other plan,
program or arrangement maintained by an entity other than the Company or a
Company Subsidiary pursuant to any collective bargaining agreements), in each
case that are sponsored, maintained or contributed to by the Company or any of
its Subsidiaries for the benefit of current or former employees, directors or
consultants of the Company or its Subsidiaries.


(b)          
Section 3.9(b) of the Company Disclosure Schedule lists all “multiemployer
plans” (as defined in Regulation 4001.2 under ERISA) to which the Company or
any ERISA Affiliate (as defined below) is obligated to contribute currently or
has been obligated to contribute during the immediately preceding three
years.  The Company has made available to
the ESOP all material written information which it has regarding potential
withdrawal liability under such multiemployer plans, and, subject to, and in
accordance with Section 5.2, the Company will use reasonable best efforts to
assist the ESOP and Merger Sub in obtaining any additional, available material
information regarding such multiemployer plans as the ESOP or Merger Sub shall
reasonably request.



 17
 








(c)           The
Company has heretofore made available to the ESOP true and complete copies of
each of the material Company Benefit Plans and material related documents,
including (i) each writing constituting a part of such Company Benefit
Plan, including all amendments thereto, (ii) the three most recent Annual
Reports (Form 5500 Series) and accompanying schedules, if any, and
(iii) the most recent determination letter from the Internal Revenue
Services (the “IRS”) (if applicable) for such Company Benefit Plan.


(d)           Except
as would not have, individually or in the aggregate, a Company Material Adverse
Effect:  (i) each material Company
Benefit Plan has been maintained and administered in compliance with its terms
and with applicable Law, including ERISA and the Code to the extent applicable
thereto, and in each case the regulations thereunder (ii) each of the
Company Benefit Plans intended to be “qualified” within the meaning of Section
401(a) of the Code has received a favorable determination letter from the IRS or
is entitled to rely upon a favorable opinion issued by the IRS, and there are
no existing circumstances or any events that have occurred that would
reasonably be expected to adversely affect the qualified status of any such
plan, (iii) with respect to each Company Benefit Plan that is subject to
Title IV of ERISA, the present value of the accrued benefits under such Company
Benefit Plan, based upon the actuarial assumptions used for funding purposes in
the most recent actuarial report prepared for such Company Benefit Plan’s
actuary with respect to such Company Benefit Plan, did not, as of its latest
valuation date, exceed the then current value of the assets of such Company
Benefit Plan allocable to such accrued benefits, (iv) no Company Benefit Plan
provides benefits, including death or medical benefits (whether or not
insured), with respect to current or former employees or directors of the
Company or its Subsidiaries beyond their retirement or other termination of
service, other than (A) coverage mandated by applicable Law or (B) benefits
under any “employee pension plan” (as such term is defined in Section 3(2) of
ERISA), (v) no liability under Title IV of ERISA has been incurred by the
Company, its Subsidiaries or any ERISA Affiliate of the Company that has not
been satisfied in full (other than with respect to amounts not yet due), and,
to the knowledge of the Company, no condition exists that presents a risk to
the Company, its Subsidiaries or any ERISA Affiliate of the Company of
incurring a liability thereunder, (vi) all contributions or other amounts
payable by the Company or its Subsidiaries as of the date hereof with respect
to each Company Benefit Plan in respect of current or prior plan years have
been paid or accrued in accordance with GAAP, (vii) neither the Company
nor its Subsidiaries has engaged in a transaction in connection with which the
Company or its Subsidiaries reasonably could be subject to either a civil
penalty assessed pursuant to Section 409 or 502(i) of ERISA or a material Tax imposed
pursuant to Section 4975 or 4976 of the Code and (viii) there are no
pending, threatened or anticipated claims (other than routine claims for
benefits) by, on behalf of or against any of the Company Benefit Plans or any
trusts related thereto which could individually or in the aggregate reasonably
be expected to result in any liability of the Company or any of its
Subsidiaries.  “ERISA Affiliate”
means, with respect to any entity, trade or business, any other entity, trade
or business that is a member of a group described in Section 414(b), (c),
(m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes the
first entity, trade or business, or that is a member of the same “controlled
group” as the first entity, trade or business pursuant to Section 4001(a)(14)
of ERISA.


(e)           Neither
the execution, delivery and performance of this Agreement nor the consummation
of the transactions contemplated by this Agreement will, either alone or in
combination with another event, (i) entitle any current or former employee,
consultant, director 



 18
 








or officer of the Company or any of its Subsidiaries to severance pay,
unemployment compensation, forgiveness of indebtedness or any other payment,
except as expressly provided in this Agreement or as required by applicable
Law, (ii) result in any “excess parachute payment” (within the meaning of
Section 280G of the Code), (iii) materially increase any benefits
otherwise payable under any Company Benefit Plan, (iv) accelerate the time
of payment or vesting, or increase the amount of compensation due any such
employee, consultant, director or officer, except as expressly provided in this
Agreement, (v) require the funding of any such benefits or (vi) limit
the ability to amend or terminate any Company Benefit Plan or related trust.


Section 3.10           Absence
of Certain Changes or Events.


(a)           From
December 31, 2006 through the date of this Agreement, except as otherwise
contemplated, required or permitted by this Agreement, the Tribune Purchase
Agreement or the ESOP Purchase Agreement, (i) the businesses of the Company and
its Subsidiaries have been conducted, in all material respects, in the ordinary
course of business, and (ii) there has not been any event, development or state
of circumstances that has had or would reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect.


(b)           Since
the date of this Agreement, there has not been any event, development or state
of circumstances that has had or would reasonably be expected to have, individually
or in the aggregate, a Company Material Adverse Effect.


Section 3.11           Investigations;
Litigation.  As of the date hereof,
(a) there is no investigation or review pending (or, to the knowledge of the
Company, threatened) by any Governmental Entity with respect to the Company,
any of the Company’s Subsidiaries or, to the knowledge of the Company, any
Company Joint Venture which would reasonably be expected to have, individually
or in the aggregate, a Company Material Adverse Effect, and (b) there are no actions,
suits, inquiries, investigations, arbitrations, mediations or proceedings
pending (or, to the knowledge of the Company, threatened) against or affecting
the Company, any of its Subsidiaries, any of their respective properties or, to
the knowledge of the Company, any Company Joint Venture at law or in equity
(and, to the knowledge of the Company, there is no basis for any such action,
suit, inquiry, investigation or proceeding) before, and there are no orders,
judgments or decrees of, or before, any Governmental Entity, in each case which
would have, individually or in the aggregate, a Company Material Adverse
Effect.


Section 3.12           Proxy
Statement; Other Information.  The
proxy statement (including the letter to shareholders, notice of meeting and
form of proxy, and any amendments or supplements thereto, the “Proxy
Statement”) and the Rule 13E-3 Transaction Statement on Schedule 13E-3 (the
“Schedule 13E-3”)  to be filed by
the Company with the SEC in connection with seeking the adoption of this
Agreement by the shareholders of the Company will not, at the time they are
concurrently filed with the SEC, or, in the case of the Proxy Statement, at the
time it is first mailed to the shareholders of the Company or at the time of
the Company Meeting, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they
were made, not misleading.  The Company
will cause the Proxy Statement and the Schedule 13E-3 to comply as to form in
all material respects with the requirements of the 



 19
 








Exchange Act and the rules and regulations thereunder applicable
thereto as of the date of such filing. 
No representation is made by the Company with respect to statements made
in the Proxy Statement or the Schedule 13E-3 based on information supplied by
the ESOP, Merger Sub or any of their affiliates specifically for inclusion or
incorporation by reference therein.


Section 3.13           Rights
Plan.  The Board of Directors of the
Company has resolved to, and the Company promptly after the execution of this
Agreement will, take all action necessary to render the rights to purchase
shares of Series A Junior Participating Preferred Stock of the Company (“Rights”),
issued pursuant to the terms of the Rights Agreement, dated as of December 12,
1997, as amended (the “Rights Agreement”), between the Company and
Computershare Trust Company, N.A. (formerly First Chicago Trust Company of New
York), as Rights Agent, inapplicable to the Merger and the execution and
operation of this Agreement.


Section 3.14           Tax
Matters.


(a)          
Except in the case of clauses (i), (iv) or (v) as would not, individually or in
the aggregate, reasonably be expected to have a Company Material Adverse
Effect, (i) the Company and each of its Subsidiaries have prepared and
timely filed (taking into account any extension of time within which to file)
all Tax Returns required to be filed by any of them and all such filed Tax
Returns are complete and accurate, (ii) the Company and each of its
Subsidiaries have paid all material Taxes that are required to be paid by any
of them (whether or not shown on any Tax Return), except, in the case of
clause (i) or clause (ii) hereof, with respect to matters contested
in good faith or for which adequate reserves have been established in
accordance with GAAP, (iii) the U.S. consolidated federal income Tax
Returns of the Company have been examined by the IRS (or the period for
assessment of the Taxes in respect of which such Tax Returns were required to
be filed has expired), (iv) as of the date of this Agreement, there are
not pending or, to the knowledge of the Company, threatened in writing, any
audits, examinations, investigations or other proceedings in respect of Taxes
or Tax matters owed or claimed to be owed by the Company or any of its
Subsidiaries, (v) there are no Liens for Taxes on any of the assets of the
Company or any of its Subsidiaries other than Permitted Liens, (vi) none
of the Company or any of its Subsidiaries has been a “controlled corporation”
or a “distributing corporation” in any distribution occurring during the
two-year period ending on the date hereof that was purported or intended to be
governed, in whole or in part, by Section 355(a) or 361 of the Code (or
any similar provision of state, local or foreign Law) and (vii) neither
the Company nor any of its Subsidiaries has ever entered into any “reportable
transaction,” as defined in Treasury Regulation Section 1.6011-4(b), required
to be reported in a disclosure statement pursuant to Treasury Regulation
Section 1.6011-4(a) (other than transactions for which Form 8866 was filed with
the Company’s Tax Returns).


(b)           None
of the Company or any of its Subsidiaries will be required to include in a
taxable period ending after the Effective Time taxable income attributable to
income that accrued (for purposes of the financial statements of the Company
included in the Company SEC Documents) in a prior taxable period (or portion of
a taxable period) but was not recognized for tax purposes in any prior taxable
period as a result of (i) the installment method of accounting,
(ii) the completed contract method of accounting, (iii) the long-term
contract method of accounting, (iv) the cash method of accounting or
Section 481 of the Code or (v) any comparable provisions of state or
local tax law, domestic or foreign, or for any other reason, other than any 



 20
 








amounts that are specifically reflected in a reserve for taxes on the
financial statements of the Company included in the Company SEC Documents.


(c)           As
used in this Agreement, (i) “Taxes” means any and all (whether or not
disputed) domestic or foreign, federal, state, local or other taxes of any kind
(together with any and all interest, penalties, additions to tax and additional
amounts imposed with respect thereto) imposed by any Governmental Entity,
including taxes on or with respect to income, franchises, windfall or other
profits, gross receipts, property, sales, use, capital stock, payroll, employment,
unemployment, social security, workers’ compensation or net worth, and taxes in
the nature of excise, withholding, ad valorem or value added, and including
liability for the payment of any such amounts as a result of being either
(A) a member of an affiliated, consolidated, combined, unitary or
aggregate group or as a transferee or successor, or (B) a party to any tax
sharing agreement or as a result of any express or implied obligation to
indemnify any other person with respect to any such amounts, and (ii) “Tax
Return” means any return, report or similar filing (including the attached
schedules) required to be filed with respect to Taxes, including any
information return, claim for refund, amended return or declaration of
estimated Taxes.


Section 3.15           Labor
Matters.  Except for matters in the
case of clause (e) below which would not reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect, as of the
date hereof, (a) there are no strikes or lockouts with respect to any
employees of the Company or any of its Subsidiaries (“Employees”) that,
individually or in the aggregate, would reasonably be expected to have a
material adverse impact on the operations of, or result in material liability
to, the Company and its Subsidiaries taken as a whole, (b) to the knowledge of
the Company, there is no union organizing effort pending or threatened against
the Company or any of its Subsidiaries that, individually or in the aggregate,
would reasonably be expected to have a material adverse impact on the
operations of, or result in material liability to, the Company and its
Subsidiaries taken as a whole, (c) there is no unfair labor practice,
labor dispute (other than routine individual grievances) or labor arbitration
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any of its Subsidiaries that, individually or in the aggregate,
would reasonably be expected to have a material adverse impact on the
operations of, or result in material liability to, the Company and its
Subsidiaries taken as a whole, (d) there is no slowdown, or work stoppage
in effect or, to the knowledge of the Company, threatened with respect to
Employees that, individually or in the aggregate, would reasonably be expected to
have a material adverse impact on the operations of, or result in material
liability to, the Company and its Subsidiaries taken as a whole, and (e) the
Company and its Subsidiaries are in compliance with all applicable Laws
respecting (i) employment and employment practices, (ii) terms and
conditions of employment and wages and hours and (iii) unfair labor
practices.  Neither the Company nor any
of its Subsidiaries has any material liabilities under the Worker Adjustment
and Retraining Act of 1998 as a result of any action taken by the Company
(other than at the written direction of the ESOP or as a result of any of the
transactions contemplated hereby) that would reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect.


Section 3.16           Intellectual
Property.  Except as would not
reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect, either the Company or a Subsidiary of the Company
owns, or is licensed or otherwise possesses legally enforceable rights to use,
free and clear of all material Liens, all domestic and foreign trademarks 



 21
 








(including call signs), trade names, service marks, service names,
assumed names, registered and unregistered copyrights and applications for
same, domain names, patents and patent applications and registrations used in
their respective businesses as currently conducted, including all rights
associated therewith, whether registered or unregistered and however documented
(collectively, the “Intellectual Property”).  Except as would not reasonably be expected to
have, individually or in the aggregate, a Company Material Adverse Effect,
since December 31, 2006, (a) there has not been any pending or, to the
knowledge of the Company, threatened claims by any person alleging
infringement, misappropriation or other unauthorized use of Intellectual
Property by the Company or any of its Subsidiaries, or challenging any aspect
of the validity, enforceability, ownership, authorship, inventorship or use of any
of the Intellectual Property, (b) to the knowledge of the Company, the conduct
of the business of the Company and its Subsidiaries has not infringed,
misappropriated or otherwise made unauthorized use of any intellectual property
rights of any person, and neither the Company nor any of its Subsidiaries has
received an “invitation to license” or other communication from any third party
asserting that the Company or any of its Subsidiaries is or will be obligated
to take a license under any intellectual property owned by any third party in
order to continue to conduct their respective businesses as they are currently
conducted, (c) neither the Company nor any of its Subsidiaries has made
any claim of infringement, misappropriation or other unauthorized use by others
of its rights to or in connection with the Intellectual Property of the Company
or any of its Subsidiaries, (d) to the knowledge of the Company, no person has
or is currently infringing, misappropriating or otherwise making unauthorized
use of any Intellectual Property of the Company or any of its Subsidiaries and
(e) the Company and its Subsidiaries have taken commercially reasonable
actions in accordance with normal industry practice to protect, maintain and
preserve the Intellectual Property.


Section 3.17           Real
Property.  Except as would not,
individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, the Company or a Subsidiary of the Company owns and
has good and valid title to all of its owned real property and has valid
leasehold interests in all of its leased properties, free and clear of all
Liens (except for Permitted Liens and all other title exceptions, defects,
encumbrances and other matters, whether or not of record, which do not
materially affect the continued use of the property for the purposes for which
the property is currently being used by the Company or a Subsidiary of the
Company as of the date hereof).


Section 3.18           Opinion
of Financial Advisor.  The Board of
Directors of the Company has received the opinion of each of Morgan Stanley
& Co. Incorporated and Merrill Lynch & Co., Inc., dated the date of
this Agreement, substantially to the effect that, as of such date, the Merger
Consideration to be received by the holders of shares of Company Common Stock
pursuant to the Merger is fair from a financial point of view to the holders of
such shares (other than certain affiliated entities).


Section 3.19           Required
Vote of the Company Shareholders. 
Subject to the accuracy of the representations and warranties of the
ESOP and Merger Sub in Section 4.9, the affirmative vote of the holders of
outstanding shares of Company Common Stock representing at least a majority of
all the votes entitled to be cast thereupon by holders of Company Common Stock
is the only vote of holders of securities of the Company which is required to
approve this Agreement and the Merger (the “Company Shareholder Approval”).



 22
 








Section 3.20           Material
Contracts.


(a)           Except
for this Agreement, the Tribune Purchase Agreement, the ESOP Purchase
Agreement, the Company Benefit Plans or as filed with the SEC, as of the date
hereof, neither the Company nor any of its Subsidiaries is a party to or bound
by, nor are any of their properties or other assets bound by, any “material
contract” (as such term is defined in Item 601(b)(10) of Regulation S-K of the
SEC) (all contracts of the type described in this Section 3.20(a) being
referred to herein as “Company Material Contracts”).


(b)           Neither
the Company nor any Subsidiary of the Company is in breach of or default under
(nor to the knowledge of the Company does there exist any condition which upon
the passage of time or the giving of notice or both would cause such a
violation of or default under) the terms of any Company Material Contract where
such breach or default would reasonably be expected to have, individually or in
the aggregate, a Company Material Adverse Effect.  To the knowledge of the Company, no other
party to any Company Material Contract is in breach of or default under the
terms of any Company Material Contract where such breach or default would
reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect.  Each Company
Material Contract is a valid and binding obligation of the Company or the Subsidiary
of the Company which is party thereto and, to the knowledge of the Company, of
each other party thereto, and is in full force and effect, except that
(i) such enforcement may be subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar Laws, now or hereafter in effect,
relating to creditors’ rights generally and (ii) equitable remedies of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought.


Section 3.21           Finders
or Brokers.  Except for Morgan
Stanley & Co. Incorporated, Merrill Lynch & Co., Inc. and Citigroup
Global Markets Inc. (the “Company Financial Advisors”), neither the Company
nor any of its Subsidiaries has employed any investment banker, broker or
finder in connection with the transactions contemplated by this Agreement who
might be entitled to any fee or any commission in connection with or upon
consummation of the Merger.  The Company
has made available to the ESOP an accurate and complete summary of the fee
arrangements with the Company Financial Advisors.


Section 3.22           Insurance.  The Company and its Subsidiaries own or hold
policies of insurance, or are self-insured, in amounts providing reasonably
adequate coverage against all risks customarily insured against by companies
and subsidiaries in similar lines of business as the Company or its
Subsidiaries, and in amounts sufficient to comply with all Company Material Contracts
to which the Company or any of its Subsidiaries are parties or are otherwise
bound.


Section 3.23           Affiliate
Transactions.  As of the date hereof,
there are no material transactions, agreements, arrangements or understandings
between (i) the Company or any of its Subsidiaries, on the one hand, and
(ii) any affiliate of the Company (other than any of its Subsidiaries), on
the other hand, of the type that would be required to be disclosed under Item
404 of Regulation S-K promulgated by the SEC which have not been so disclosed
prior to the date hereof.



 23
 








Section 3.24           Indebtedness.  Section 3.24 of the Company Disclosure
Schedule sets forth, as of April 1, 2007, all of the outstanding
indebtedness for borrowed money of, and all the outstanding guarantees of
indebtedness for borrowed money of any person by, and all reimbursement
obligations (or guarantees thereof) with respect to letters of credit issued on
behalf of, the Company and each of its Subsidiaries.


Section 3.25           Cable
and Satellite Matters.  Section 3.25
of the Company Disclosure Schedule sets forth a list of the ten largest
multichannel video programming distributors (including cable systems, SMATV,
open video systems, MMDS, MDS, Broadband Radio Service and DBS
systems, collectively, “MVPDs”) that carry the analog and/or
digital signals of the Company Stations.  No MVPD listed on
Section 3.25 of the Company Disclosure Schedule has declined or refused to
carry a Company Station or disputed a Company Station’s right to carriage
pursuant to such Company Station’s must-carry or retransmission consent
election, as the case may be.


ARTICLE
IV


REPRESENTATIONS
AND WARRANTIES OF THE ESOP AND MERGER SUB


The ESOP and Merger Sub jointly and severally
represent and warrant to the Company as follows:


Section 4.1             Qualification,
Organization, Subsidiaries, etc.   Merger Sub is a legal entity duly organized,
validly existing and in good standing under the Laws of its respective
jurisdiction of organization and has all requisite corporate or similar power
and authority to own, lease, hold and operate its properties and assets and to
carry on its business as presently conducted and is qualified to do business
and is in good standing as a foreign corporation in each jurisdiction where the
ownership, leasing, holding or operation of its assets or properties or conduct
of its business requires such qualification, except where the failure to be so
organized, validly existing, qualified or in good standing, or to have such
power or authority, would not, individually or in the aggregate, reasonably be
expected to prevent or materially delay or materially impair the ability of the
ESOP or Merger Sub to consummate the Merger and the other transactions
contemplated by this Agreement (an “ESOP Material Adverse Effect”).  The ESOP has made available to the Company
prior to the date of this Agreement a true and complete copy of the operating
agreement of the ESOP and the certificate of incorporation and by-laws of
Merger Sub, each as amended through the date hereof.


Section 4.2             Authority
Relative to This Agreement; No Violation.


(a)           The
ESOP has all requisite power and authority to enter into this Agreement and to
consummate the transactions contemplated hereby.  Merger Sub has all requisite corporate power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby.  The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the trustee of the
ESOP, the Board of Directors of Merger Sub and by the ESOP, as the sole
shareholder of Merger Sub, and, except for the filing of the Certificate of
Merger with the 



 24
 








Secretary of State of the State of Delaware, no other organizational
proceedings on the part of the ESOP or corporate proceedings on the part of
Merger Sub are necessary to authorize this Agreement or the consummation of the
transactions contemplated hereby.  This
Agreement has been duly and validly executed and delivered by the ESOP and
Merger Sub and, assuming this Agreement constitutes the legal, valid and
binding agreement of the Company, this Agreement constitutes the legal, valid
and binding agreement of the ESOP and Merger Sub, enforceable against each of
the ESOP and Merger Sub in accordance with its terms.


(b)           The
execution, delivery and performance by the ESOP and Merger Sub of this
Agreement and the consummation of the Merger and the other transactions
contemplated by this Agreement by the ESOP and Merger Sub do not and will not
require any consent, approval, license, authorization, order or permit of,
action by, filing with or notification to any Governmental Entity, other than
(i) the filing of the Certificate of Merger, (ii) compliance with the
applicable requirements of the HSR Act, (iii) compliance with the applicable
requirements of the Exchange Act, (iv) filings with and approvals from the FCC
and the State Commissions as set forth on Section 3.3(b) of the Company
Disclosure Schedule, (v) compliance with any applicable foreign or state
competition, antitrust, securities or blue sky laws, (vi) filings under
any applicable state takeover Law and (vii) such of the foregoing as may
be required in connection with the Financing (collectively, clauses (i) through
(vii), the “ESOP Approvals”), and other than any consent, approval,
license, authorization, order, permit, action, filing or notification the
failure of which to make or obtain would not, individually or in the aggregate,
reasonably be expected to have an ESOP Material Adverse Effect.


(c)           The
execution, delivery and performance by the ESOP and Merger Sub of this
Agreement and the consummation by the ESOP and Merger Sub of the Merger and the
other transactions contemplated hereby do not and will not (i) contravene or
conflict with the organizational or governing documents of the ESOP or Merger
Sub, (ii) assuming compliance with the matters referenced in
Section 4.2(b), contravene or conflict with or result in violation of any
provision of any Law binding upon or applicable to the ESOP or Merger Sub or any
of their respective properties or assets, or (iii) result in any violation of,
or default (with or without notice or lapse of time, or both) under, or give
rise to a right of termination, cancellation or acceleration of any material
obligation or to the loss of a material benefit under, or to increased,
additional, accelerated or guaranteed rights or entitlements of any person
under, any loan, guarantee of indebtedness or credit agreement, note, bond,
mortgage, indenture, lease, agreement, contract, instrument, permit,
concession, franchise, right or license to which the ESOP or Merger Sub is a
party or by which any of their respective properties or assets is bound, or
(iv) result in the creation of any Lien (other than Permitted Liens) upon
any of the properties or assets of the ESOP or Merger Sub, other than, in the
case of clause (ii) through (iv), any such items that would not, individually
or in the aggregate, reasonably be expected to have an ESOP Material Adverse
Effect.


Section 4.3             Investigations;
Litigation.  There is no
investigation or review pending (or, to the knowledge of the ESOP, threatened)
by any Governmental Entity with respect to the ESOP or Merger Sub which could,
individually or in the aggregate, reasonably be expected to have an ESOP
Material Adverse Effect, and there are no actions, suits, inquiries,
investigations or proceedings pending (or, to the ESOP’s knowledge, threatened)
against or affecting the ESOP or Merger Sub, or any of their respective
properties at law or in equity (and 



 25
 








to the ESOP’s knowledge there is no basis for any such action, suit,
inquiry, investigation, arbitration, mediation or proceeding) before, and there
are no orders, judgments or decrees of, or before, any Governmental Entity, in
each case which could, individually or in the aggregate, reasonably be expected
to have an ESOP Material Adverse Effect.


Section 4.4             Proxy
Statement; Other Information.  None
of the information provided by the ESOP or Merger Sub to be included in the
Proxy Statement, the Schedule TO or the Schedule 13E-3 will, at the time the
Proxy Statement, the Schedule TO and the Schedule 13E-3 are concurrently filed
with the SEC, or, in the case of the Proxy Statement, at the time the Proxy
Statement is first mailed to the shareholders of the Company or at the time of
the Company Meeting, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they
were made, not misleading.  No
representation is made by the ESOP or Merger Sub with respect to statements
made in the Proxy Statement, the Schedule TO or the Schedule 13E-3 based on
information supplied by the Company, any of the Company’s Subsidiaries or any
of their respective affiliates.


Section 4.5             Capitalization
of Merger Sub.  As of the date of
this Agreement, the authorized capital stock of Merger Sub consists of 1000
shares of common stock, par value $.01 per share, 100 of which are validly issued
and outstanding.  All of the issued and
outstanding capital stock of Merger Sub is, and at the Effective Time will be,
owned by the ESOP.  Merger Sub has
outstanding no option, warrant, right, or any other agreement pursuant to which
any person other than the ESOP may acquire any equity security of Merger
Sub.  Merger Sub has not conducted any
business prior to the date hereof, other than business and operations related
to the Merger and the transactions contemplated by this Agreement, and has no
assets, liabilities or obligations of any nature other than those incident to
its formation and pursuant to this Agreement and the Merger and the other
transactions contemplated by this Agreement.


Section 4.6             Lack
of Ownership of Company Common Stock. 
Except as contemplated by the ESOP Purchase Agreement, neither the ESOP
nor any of its Subsidiaries beneficially owns or, since December 31, 2006
has beneficially owned, directly or indirectly, any shares of Company Common
Stock or other securities convertible into, exchangeable into or exercisable
for shares of Company Common Stock.


Section 4.7             Finders
or Brokers.  Except for Duff &
Phelps, LLC, the ESOP has not employed any financial advisor, investment
banker, broker or finder in connection with the transactions contemplated by
this Agreement who is entitled to any fee or any commission in connection with
or upon consummation of the Merger.


Section 4.8             No
Additional Representations.


(a)           The
ESOP acknowledges that it and its Representatives (as hereinafter defined) have
received access to such books and records, facilities, equipment, contracts and
other assets of the Company which it and its Representatives have desired or
requested to review, and that it and its Representatives have had full
opportunity to meet with the management of the Company and to discuss the
business and assets of the Company.



 26
 








(b)           The
ESOP acknowledges that neither the Company nor any person has made any
representation or warranty, express or implied, as to the accuracy or
completeness of any information regarding the Company furnished or made
available to the ESOP and its Representatives except as expressly set forth in
Article III, and neither the Company nor any other person shall be subject to
any liability to the ESOP or any other person resulting from the Company’s
making available to the ESOP or the ESOP’s use of such information, including
the presentation materials delivered to the ESOP, as subsequently updated,
supplemented or amended (the “Information Memorandum”), or any information,
documents or material made available to the ESOP in the due diligence materials
provided to the ESOP, including in the “data room,” other management
presentations (formal or informal) or in any other form in connection with the
transactions contemplated by this Agreement. 
Without limiting the foregoing, the Company makes no representation or
warranty to the ESOP with respect to (i) the information set forth in the
Information Memorandum or (ii) any financial projection or forecast relating to
the Company or any of its Subsidiaries, whether or not included in the
Information Memorandum or any management presentation.


ARTICLE V


COVENANTS
AND AGREEMENTS


Section 5.1             Conduct
of Business by the Company.


(a)           From
and after the date hereof and prior to the Effective Time or the date, if any,
on which this Agreement is earlier terminated pursuant to Section 7.1 (the “Termination
Date”), and except (i) as may be required by applicable Law,
(ii) as may be agreed in writing by the ESOP and Tribune Acquisition
(which consent shall not be unreasonably withheld), (iii) as may be
expressly required or permitted by this Agreement, the Tribune Purchase
Agreement, the Financing Commitments, the New Credit Agreements or the ESOP
Purchase Agreement, or (iv) as set forth in Section 5.1 of the Company
Disclosure Schedule, the Company covenants and agrees that (A) the
business of the Company and its Subsidiaries shall be conducted in, and such
entities shall not take any action except in, the ordinary course of business
and in a manner consistent with past practice and (B) the Company and its
Subsidiaries shall use their reasonable best efforts to preserve substantially
intact the Company’s business, to keep available the services of those of their
present officers, employees and consultants who are important to the operation
of their business; provided, however, that no action by the
Company or its Subsidiaries with respect to matters specifically addressed by
any provision of Section 5.1(b) shall be deemed a breach of this sentence
unless such action would constitute a breach of such other provision.


(b)           Subject
to the exceptions contained in clauses (i) through (iv) of Section 5.1(a),
the Company agrees, on behalf of itself and its Subsidiaries, that between the
date hereof and the Effective Time, without the prior written consent of the
ESOP, the Company:


(i)            shall
not, and shall not permit any of its Subsidiaries that is not wholly owned  to, authorize or pay any dividends on or make any
distribution with respect to its outstanding shares of capital stock or other
equity securities (whether in cash, assets, stock or other securities of the
Company or its Subsidiaries), except (A) dividends and distributions paid 



 27
 








or made on a pro rata basis by Subsidiaries and (B) that the Company
may continue to pay dividends on the Company Preferred Stock in accordance with
the terms thereof;


(ii)           shall
not, and shall not permit any of its Subsidiaries to, split, combine or
reclassify any of its capital stock or other equity securities or issue or
authorize or propose the issuance of any other securities in respect of, in
lieu of or in substitution for shares of its capital stock or other equity
securities, except (A) for any such transaction by a wholly owned
Subsidiary of the Company which remains a wholly owned Subsidiary after
consummation of such transaction and (B) as contemplated by the Exchange
Agreement;


(iii)          except
to the extent required by Law (including Section 409A of the Code) or by
Contracts in existence as of the date hereof or by Company Benefit Plans, shall
not and shall not permit any of its Subsidiaries to (A) increase in any
manner the compensation or benefits of any of its employees, directors,
consultants, independent contractors or service providers except in the ordinary
course of business consistent with past practice (the ordinary course
including, for this purpose, the employee salary, bonus and equity compensation
review process and related adjustments substantially as conducted each year),
(B) pay any pension, severance or retirement benefits not required by any
existing plan or agreement to any such employees, directors, consultants,
independent contractors or service providers, (C) enter into, amend, alter
(other than amendments that do not materially increase the cost to the Company
or any of its Subsidiaries of maintaining the applicable compensation or
benefit program, policy, arrangement or agreement), adopt, implement or
otherwise commit itself to any compensation or benefit plan, program, policy,
arrangement or agreement including any pension, retirement, profit-sharing,
bonus, collective bargaining or other employee benefit or welfare benefit plan,
policy, arrangement or agreement or employment or consulting agreement with or
for the benefit of any employee, director, consultant, independent contractor
or service provider, other than with respect to any employment, severance or
retention agreement (or amendment with respect thereto) entered into in the
ordinary course of business consistent with past practice between the Company
or one of its Subsidiaries, on the one hand, and any consultant, independent
contractor, service provider or employee of the Company or its Subsidiaries who
is not an executive officer of the Company or its Subsidiaries, or
(D) accelerate the vesting of, or the lapsing of restrictions with respect
to, any stock options or other stock-based compensation or otherwise accelerate
any rights or benefits, or make any determinations that would result in a
material increase in liabilities under any Company Benefit Plan;


(iv)          shall
not, and shall not permit any of its Subsidiaries to, change financial
accounting policies, practices or procedures or any of its methods of reporting
income, deductions or other material items for financial accounting purposes,
except as required by GAAP, SEC rule or policy or applicable Law;


(v)           shall
not, and shall not permit any of its Subsidiaries to, adopt any amendments to
its certificate of incorporation or by-laws or similar applicable
organizational documents, except pursuant to the Certificate of Designation;


(vi)          except
for transactions among the Company and its wholly owned Subsidiaries or among
the Company’s wholly owned Subsidiaries, shall not, and shall not permit any of
its Subsidiaries to, issue, sell, pledge, dispose of or encumber, or authorize
the issuance, 



 28
 








sale, pledge, disposition or encumbrance of, any shares of its capital
stock or other ownership interest in the Company or any Subsidiaries or any
securities convertible into or exchangeable for any such shares or ownership
interest, or any rights, warrants or options to acquire or with respect to any
such shares of capital stock, ownership interest or convertible or exchangeable
securities or take any action to cause to be exercisable any otherwise unexercisable
option under any existing stock option plan (except as otherwise expressly
provided by the terms of this Agreement or the express terms of any
unexercisable options outstanding on the date hereof), other than
(A) issuances of shares of Company Common Stock in respect of any exercise
of Company Stock Options and settlement of any Company Stock-Based Awards (each
as hereinafter defined) outstanding on the date hereof or as may be granted
after the date hereof as permitted under this Section 5.1(b), (B) issuances of
up to 75,000  shares of
Company Common Stock in the ordinary course of business pursuant to the Company
Benefit Plans, (C) the sale of shares of Company Common Stock pursuant to the
exercise of options to purchase Company Common Stock permitted under this
Section 5.1(b) if necessary to effectuate an optionee direction upon
exercise or for withholding of Taxes and (D) issuances of shares of
Company Common Stock and other Company securities pursuant to the Tribune
Purchase Agreement and the ESOP Purchase Agreement;


(vii)         except
for transactions among the Company and its wholly owned Subsidiaries or among
the Company’s wholly owned Subsidiaries, shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, purchase, redeem or otherwise
acquire any shares of its capital stock or other equity securities or any
rights, warrants or options to acquire any such equity securities;


(viii)        shall
not, and shall not permit any of its Subsidiaries to, incur, assume, guarantee,
prepay or otherwise become liable for any indebtedness for borrowed money
(directly, contingently or otherwise), except for (A) any indebtedness for
borrowed money among the Company and its wholly owned Subsidiaries or among the
Company’s wholly owned Subsidiaries, (B) indebtedness for borrowed money
incurred to replace, renew, extend, refinance or refund any existing
indebtedness for borrowed money (x) on materially no less favorable terms
and so long as such indebtedness is voluntarily prepayable or redeemable without
premium or penalty or (y) with borrowings under and pursuant to the
(1) Amended and Restated Credit Agreement and the Amended and Restated
Bridge Credit Agreement, each dated as of June 27, 2006, among the
Company, the banks, financial institutions and other institutional lenders
party thereto, and Citicorp North America, Inc., as administrative agent
(together, the “Existing Credit Agreements”) or the (2) definitive
credit agreements (the “New Credit Agreements”) to be entered into by
the Company pursuant to the Financing Commitments, (C) guarantees by the
Company of indebtedness for borrowed money of Subsidiaries of the Company,
which indebtedness is incurred in compliance with this Section 5.1(b),
(D) indebtedness for borrowed money in an amount necessary to effect the
exercise of the purchase option for the properties currently owned by TMCT, LLC
and leased to the Company and its Subsidiaries, (E) indebtedness for
borrowed money in an amount not to exceed $100 million in aggregate principal amount outstanding
at any time, incurred as (x) a “Revolving Credit Advance” or a “Swing
Line Advance” and “Term Advances” under and pursuant to the
Existing Credit Agreements or (y) as an advance under the revolving credit
facility to be included in the New Credit Agreements; provided that any
amount borrowed pursuant to this clause (E) shall reduce the amount of
borrowings permitted under clause (G) below, (F) indebtedness for borrowed



 29














money as required to consummate the Offer, the Merger and the
transactions contemplated hereby or by the New Credit Agreements
and (G) other unsecured indebtedness for borrowed money not to
exceed $100 million in aggregate principal amount outstanding at any time
other than in accordance with clauses (A)-(F) above, so long as such
indebtedness is voluntarily prepayable or redeemable (without premium
or penalty) upon no more than three business days’ notice; provided
that any amount borrowed pursuant to this clause (G) shall reduce the amount of
borrowings permitted under clause (E)(y) above;


(ix)           except
for transactions among the Company and its wholly owned Subsidiaries or among
the Company’s wholly owned Subsidiaries, shall not sell, lease, license, transfer,
exchange or swap, mortgage or otherwise encumber (including securitizations),
or subject to any Lien (other than Permitted Liens) or otherwise dispose of any
material portion of its properties or assets, including the capital stock or
equity securities of Subsidiaries, except (A) sales of inventory in the
ordinary course of business, (B) pursuant to existing agreements in effect
prior to the execution of this Agreement and (C) as set forth on Section
5.1(b) of the Company Disclosure Schedule;


(x)            shall
not, and shall not permit any of its Subsidiaries to, modify, amend, terminate
or waive any rights under any Company Material Contract in any material respect
in a manner which is adverse to the Company;


(xi)           shall
not, and shall not permit any of its Subsidiaries to, enter into any Company
Material Contracts;


(xii)          shall
not, and shall not permit any of its Subsidiaries to, (A) make, change or
revoke any material Tax election, (B) file any amended Tax Return, or (C)
settle or compromise any liability for Taxes or surrender any claim for a
refund of Taxes, other than in the case of clauses (B) and (C) hereof in
respect of any Taxes that have been identified in the reserves for Taxes in the
Company’s GAAP financial statements;


(xiii)         shall
not acquire, except in respect of any mergers, consolidations, business
combinations among the Company and its wholly owned Subsidiaries or among the
Company’s wholly owned Subsidiaries, including by merger, consolidation or
acquisition of stock or assets, any corporation, partnership, limited liability
company, other business organization or any division thereof, or any material
amount of assets in connection with acquisitions or investments with a purchase
price of $120 million in the aggregate; provided that without the ESOP’s
consent (which consent may not be unreasonably withheld), the Company shall not
acquire or make any investment (or agree to acquire or to make any investment)
in any entity that holds, or has an attributable interest in, any license,
authorization, permit or approval issued by the FCC;


(xiv)        shall
not adopt or enter into a plan of restructuring, recapitalization or other
reorganization (other than as contemplated in this Agreement);


(xv)         shall
not settle or compromise any claim, suit, action, arbitration, or other
proceeding, whether administrative, civil or criminal, in law or in equity,
including in connection with the Matthew Bender and Mosby Tax litigation,
except for claims that consist 



 30
 








solely of monetary damages in an amount not to exceed $20 million
individually and $75 million in the aggregate;


(xvi)        shall
not make any capital expenditures other than in accordance with the Company’s
budget consistent with past practice and other than expenditures necessary in
response to emergencies such as natural disasters or acts of terrorism, in each
case in accordance with past practice;


(xvii)       shall
not enter into any transaction, agreement, arrangement or understanding between
(A) the Company or any Subsidiary, on the one hand, and (B) any
affiliate of the Company (other than the Subsidiaries), on the other hand, of
the type that would be required to be disclosed under Item 404 of Regulation
S-K promulgated by the SEC;


(xviii)      shall
not knowingly take any action that would be reasonably likely to prevent or
cause a material delay in the satisfaction of the conditions contained in
Sections 6.1 and 6.3 or the consummation of the Merger; and


(xix)         shall
not, and shall not permit any of its Subsidiaries to, agree, in writing or
otherwise, to take any of the foregoing actions.


(c)           The
Company (on behalf of itself and its Subsidiaries and affiliates) agrees that,
between the date hereof and the Effective Time, they shall not, and shall not
permit any of their respective Subsidiaries or affiliates to enter into or consummate
any agreements or arrangements for an acquisition (via stock purchase, merger,
consolidation, purchase of assets or otherwise) of any ownership interest
attributable to the ESOP or any of its affiliates under the FCC Rules in any
radio or television broadcast licensee, or the publisher of any English
language daily newspaper of general circulation, if the ownership of such
interest would reasonably be expected (A) to result in any delay in obtaining,
or failure to obtain, the FCC Order or (B) to require the FCC to issue
additional waivers of its ownership rules in prior to granting the FCC Order.


Section 5.2             Investigation.
The Company shall afford to the ESOP and its accountants, consultants, legal
counsel, financial advisors, and agents and other representatives
(collectively, “Representatives”) reasonable access during normal
business hours, throughout the period prior to the earlier of the Effective
Time and the Termination Date, to its and its Subsidiaries’ officers,
employees, properties, contracts, commitments, books and records and any
report, schedule or other document filed or received by it pursuant to the
requirements of applicable Laws and shall furnish the ESOP with financial,
operating and other data and information as the ESOP, through its respective
officers, employees or other authorized Representatives, may from time to time
reasonably request in writing. 
Notwithstanding the foregoing, the Company shall not be required to
afford such access if it would unreasonably disrupt the operations of the
Company or any of its Subsidiaries, would cause a violation of any agreement to
which the Company or any of its Subsidiaries is a party, would cause a material
risk of a loss of privilege to the Company or any of its Subsidiaries or would
constitute a violation of any applicable Law, nor shall the ESOP or any of its
Representatives be permitted to perform any onsite procedure (including any
onsite environmental study) with respect to any property of the Company or any
of its Subsidiaries, except, with respect to any onsite procedure, 



 31
 








with the Company’s prior written consent (which consent shall not be
unreasonably withheld, delayed or conditioned if such procedure is necessary
for the Financing).


Section 5.3             No
Solicitation.


(a)           Subject
to Section 5.3(b)-(e), (i) the Company shall, and shall cause its
Subsidiaries to, and shall direct its and their respective Representatives to,
immediately cease any discussions or negotiations with any parties that may be
ongoing with respect to any Alternative Proposal and (ii) during the
period beginning on the date hereof and continuing until the Effective Time or,
if earlier, the termination of this Agreement in accordance with
Article VII, the Company agrees that neither it nor any Subsidiary of the
Company shall, and that it shall direct its and their respective
Representatives not to, directly or indirectly, (A) solicit, initiate or
knowingly facilitate or encourage any inquiry with respect to, or the making,
submission or announcement of, any Alternative Proposal (as hereinafter
defined), (B) participate in any negotiations regarding an Alternative
Proposal with, or furnish any nonpublic information regarding an Alternative
Proposal or access to its properties, books, records or personnel in connection
therewith to, any person that has made or, to the Company’s knowledge, is
considering making an Alternative Proposal, (C) engage in discussions
regarding an Alternative Proposal with any person that has made or, to the
Company’s knowledge, is considering making an Alternative Proposal, except to
notify such person as to the existence of the provisions of this
Section 5.3, (D) approve, endorse or recommend any Alternative
Proposal, (E) enter into any letter of intent or agreement in principle or
any agreement providing for any Alternative Proposal (except for
confidentiality agreements permitted under Section 5.3(b)),
(F) otherwise cooperate with, or assist or participate in, or knowingly
facilitate or encourage any effort or attempt by any person (other than the
ESOP, Merger Sub, Tribune Acquisition or their Representatives) with respect
to, or which would reasonably be expected to result in, an Alternative
Proposal, or (G) exempt any person from the restrictions contained in any
state takeover or similar laws, including Section 203 of the DGCL or otherwise
cause such restrictions not to apply. 
The Company shall promptly inform its Representatives, and shall cause
its Subsidiaries promptly to inform their respective Representatives, of the
obligations under this Section 5.3(a). 
Without limiting the foregoing, it is understood that any action of any
Subsidiary of the Company or Representative of the Company or any of its
Subsidiaries that would be a violation if taken by the Company shall be deemed
to be a breach of this Section 5.3 by the Company.


(b)           Notwithstanding
the limitations set forth in Section 5.3(a), at any time from the date
hereof and continuing until the earlier of the receipt of the Company
Shareholder Approval and the Termination Date, if the Company receives a bona
fide written Alternative Proposal that was not solicited after the execution
and delivery hereof (i) which (A) constitutes a Superior Proposal or
(B) the Special Committee or the Board of Directors of the Company
determines in good faith could reasonably be expected to result in a Superior
Proposal, and (ii) which the Special Committee or the Board of Directors
of the Company determines in good faith, after consultation with the Special
Committee’s or the Company’s outside legal counsel, that the failure of the
Special Committee or the Board of Directors of the Company to take the actions
set forth in clauses (x) and (y) below with respect to such Alternative
Proposal would be inconsistent with the directors’ exercise of their fiduciary
obligations to the Company’s shareholders under applicable Law, then the
Company may take the following actions: 



 32
 








(x) furnish nonpublic information to the third party (including
its Representatives) making such Alternative Proposal (if, and only if, prior
to so furnishing such information, the Company receives from the third party an
executed agreement having provisions requiring such party to keep such
information confidential that, subject to Section 5.3(d), are
substantially similar to the comparable confidentiality provisions of that
certain Confidentiality Agreement, dated as of November 8, 2006, by and
between the Company and Equity Group Investments, L.L.C. (the “Confidentiality
Agreement”), it being understood that such agreement with such third party
need not have comparable standstill provisions), (y) engage in discussions
or negotiations with the third party (including its Representatives) with
respect to the Alternative Proposal, and (z) approve, recommend and enter
into an agreement with the third party with respect to the Alternative Proposal
and exempt such third party from the restrictions contained in any state
takeover or similar laws, including Section 203 of the DGCL or otherwise cause
such restrictions not to apply to such Alternative Proposal, in each case in
connection with the termination of this Agreement pursuant to and in accordance
with the terms of Section 7.1(g); provided, however, that
(1) the ESOP shall be entitled to receive an executed copy of such
confidentiality agreement prior to or substantially simultaneously with the
Company furnishing information to the person making such Alternative Proposal
or its Representatives and (2) the Company shall substantially
simultaneously provide or make available to the ESOP any written material
nonpublic information concerning the Company or any of its Subsidiaries that is
provided to the person making such Alternative Proposal or its Representatives
which was not previously provided or made available to the ESOP.


(c)           Except
as provided in the next sentence, neither the Special Committee nor the Board
of Directors of the Company shall (i) withdraw or modify, or propose
publicly to withdraw or modify in a manner adverse to the ESOP, the approval or
recommendation by the Special Committee or the Board of Directors of the
Company of the Merger or this Agreement or the other transactions or agreements
contemplated by this Agreement (including the Offer), (ii) approve, adopt
or recommend, or propose publicly to approve, adopt or recommend, any Alternative
Proposal, (iii) recommend that shareholders of the Company tender their
shares in connection with any tender offer or exchange offer (other than the
Offer) or (iv) exempt any person from the restrictions contained in any
state takeover or similar laws, including Section 203 of the DGCL (each of
the foregoing, a “Change of Recommendation”).  Notwithstanding the foregoing, but subject to
Section 5.4(c), the Special Committee or the Board of Directors of the
Company may, at any time, make a Change of Recommendation if the Special
Committee or the Board of Directors of the Company has concluded in good faith,
after consultation with the Company’s or the Special Committee’s outside legal
counsel and financial advisors, that the failure of the Special Committee or
the Board of Directors of the Company to effect a Change of Recommendation
would be inconsistent with the directors’ exercise of their fiduciary
obligations to the Company’s shareholders under applicable Law; provided,
however, that no Change of Recommendation shall change the approval of
the Special Committee or the Board of Directors of the Company for purposes of
(A) causing any state takeover statute or other state law to be
inapplicable to the transactions contemplated by this Agreement or (B) rendering
the Rights issued pursuant to the Rights Agreement inapplicable to the Merger
and the execution and operation of this Agreement.


(d)           The
Company promptly (and in any event within 48 hours) shall advise the ESOP
orally and in writing of (i) any Alternative Proposal after the date
hereof or indication 



 33
 








or inquiry after the date hereof with respect to or that would
reasonably be expected to lead to any Alternative Proposal, (ii) any
request after the date hereof for nonpublic information relating to the Company
or its Subsidiaries, other than requests for information not reasonably
expected to be related to an Alternative Proposal, or (iii) any inquiry or
request after the date hereof for discussion or negotiation regarding an
Alternative Proposal, including in each case the identity of the person making
any such Alternative Proposal or indication or inquiry and the material terms
of any such Alternative Proposal or indication or inquiry (including copies of
any document or correspondence evidencing such Alternative Proposal or
inquiry).  The Company shall keep the
ESOP reasonably informed on a current basis (and in any event within 48 hours
of the occurrence of any material changes or developments) of the status
(including the material terms and conditions thereof and any material change
thereto) of any such Alternative Proposal or indication or inquiry, including
furnishing copies of any written revised proposals.  Without limiting the foregoing, the Company
shall promptly (and in any event within 48 hours) notify the ESOP orally and in
writing if it determines to begin providing information or to engage in
discussions or negotiations concerning an Alternative Proposal.  The Company shall not, and shall cause its
Subsidiaries not to, enter into any confidentiality agreement with any person
subsequent to the date of this Agreement which prohibits the Company from
providing such information to the ESOP as required by this Section 5.3(d).


(e)           Nothing
contained in this Agreement shall prohibit the Company or its Board of
Directors from (i) disclosing to its shareholders a position contemplated by
Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act, or from issuing a “stop,
look and listen” statement pending disclosure of its position thereunder, or
(ii) making any disclosure to its shareholders if the Board of Directors
determines in good faith, after consultation with the Company’s outside legal
counsel, that the failure of the Board of Directors of the Company to make such
disclosure would be inconsistent with the directors’ exercise of their
fiduciary obligations to the Company’s shareholders under applicable Law; provided,
however, that neither the Company, the Board of Directors nor the
Special Committee may effect a Change of Recommendation unless permitted by
Section 5.3(c).


(f)            As
used in this Agreement, “Alternative Proposal” shall mean any bona fide
proposal or offer (including any proposal or offer from or to the Company’s
shareholders) made by any person or group of persons prior to the receipt of
the Company Shareholder Approval (other than a proposal or offer by the ESOP,
Merger Sub and Tribune Acquisition and other than the Offer) for (i) a
merger, reorganization, share exchange, consolidation, business combination,
recapitalization, dissolution, liquidation or similar transaction involving the
Company, (ii) the direct or indirect acquisition in a single transaction
or series of related transactions by any person of assets representing twenty
percent (20%) or more of the consolidated assets, revenues or earnings of the
Company and its Subsidiaries, (iii) the direct or indirect acquisition in
a single transaction or series of related transactions by any person of twenty
percent (20%) or more of the outstanding shares of Company Common Stock or
(iv) any tender offer or exchange offer that if consummated would result
in any person beneficially owning twenty percent (20%) or more of the
outstanding shares of Company Common Stock.


(g)           As
used in this Agreement “Superior Proposal” shall mean an Alternative
Proposal (with all percentages in the definition of Alternative Proposal
increased to 50%) on terms that the Special Committee or the Board of Directors
of the Company determines in good 



 34
 








faith, after consultation with the Company’s or the Special Committee’s
outside legal and financial advisors, and considering such factors as the
Special Committee or the Board of Directors of the Company, as applicable,
consider to be appropriate (including the timing and likelihood of consummation
of such proposal, financial and regulatory aspects, and any alterations to this
Agreement agreed to in writing by the ESOP in response thereto), is more
favorable to the Company and its shareholders than the transactions
contemplated by this Agreement.


Section 5.4             Proxy
Statement; Company Meeting.


(a)           The
Company, the ESOP and Merger Sub shall each use their reasonable best efforts
to take or cause to be taken such actions as may be required to be taken under
the Exchange Act or any other federal securities Laws, and under any applicable
state securities or “blue sky” Laws, in connection with the Merger and the
other transactions contemplated by this Agreement, including the Proxy
Statement and the Schedule 13E-3.  In
connection with the Merger and the Company Meeting, the Company shall prepare
and concurrently file with the SEC the Proxy Statement and the Schedule 13E-3
relating to the Merger and the other transactions contemplated by this
Agreement, and the Company and the ESOP shall use all reasonable best efforts to
respond to the comments of the SEC and to cause the Proxy Statement to be
mailed to the Company’s shareholders, all as promptly as reasonably
practicable; provided, however, that prior to the concurrent
filing of the Proxy Statement and the Schedule 13E-3 the Company shall consult
with the ESOP with respect to such filings and shall afford the ESOP and its
respective Representatives reasonable opportunity to review and comment
thereon.  The ESOP and Merger Sub shall
provide the Company with any information for inclusion in the Proxy Statement
or the Schedule 13E-3 which may be required under applicable Law and/or which
is reasonably requested by the Company. 
The Company shall notify the ESOP of the receipt of comments of the SEC
and of any request from the SEC for amendments or supplements to the Proxy
Statement or the Schedule 13E-3 or for additional information, and will
promptly supply the ESOP with copies of all correspondence between the Company
or its Representatives, on the one hand, and the SEC or members of its staff,
on the other hand, with respect to the Proxy Statement, the Schedule 13E-3 or
the Merger.  Each of the Company, the
ESOP and Merger Sub shall use its respective reasonable best efforts to resolve
all SEC comments with respect to the Proxy Statement, the Schedule 13E-3 and
any other required filings as promptly as practicable after receipt
thereof.  Each of the Company, the ESOP
and Merger Sub agree to correct any information provided by it for use in the
Proxy Statement or the Schedule 13E-3 which shall have become false or
misleading.  If at any time prior to the
Company Meeting any event should occur which is required by applicable Law to
be set forth in an amendment of, or a supplement to, the Proxy Statement or the
Schedule 13E-3, the Company will promptly inform the ESOP.  In such case, the Company, with the
cooperation of the ESOP, will, upon learning of such event, promptly prepare
and file such amendment or supplement with the SEC to the extent required by
applicable Law and shall mail such amendment or supplement to the Company’s
shareholders to the extent required by applicable Law; provided, however,
that prior to such filing, the Company shall consult with the ESOP with respect
to such amendment or supplement and shall afford the ESOP and its
Representatives reasonable opportunity to comment thereon.  Notwithstanding the foregoing, the Company
shall have no obligation to notify the ESOP of any matters to the extent that
the Special Committee or the Board of Directors of the Company determines in
good faith, after consultation with the Company’s or the 



 35
 








Special Committee’s legal counsel, that to do so would be inconsistent
with the directors’ exercise of their fiduciary obligations to the Company’s
shareholders under applicable Law.


(b)           Subject
to the other provisions of this Agreement, the Company shall (i) take all
action necessary in accordance with the DGCL and its amended and restated
certificate of incorporation and by-laws to duly call, give notice of, convene
and hold a meeting of its shareholders as promptly as reasonably practicable
following the mailing of the Proxy Statement for the purpose of obtaining the
Company Shareholder Approval (the “Company Meeting”) (including mailing
the Proxy Statement as soon as reasonably practicable after the SEC has cleared
the Proxy Statement and holding the Company Meeting no later than 45 days after
mailing the Proxy Statement, unless a later date is mutually agreed by the
Company and the ESOP), and (ii) subject to any Change of Recommendation of the
Board of Directors or the Special Committee in accordance with Section 5.3(c),
(A) include in the Proxy Statement the recommendation of the Board of Directors
of the Company, based on the unanimous recommendation of the Special Committee,
that the shareholders of the Company vote in favor of the adoption of this
Agreement, and the written opinions referred to in Section 3.18 hereof,
dated as of the date of this Agreement (unless the Company shall have been
notified of the withdrawal of either such opinion) and (B) use all reasonable
best efforts to solicit from its shareholders proxies in favor of the approval
of this Agreement and the transactions contemplated by this Agreement.


(c)           Notwithstanding
anything herein to the contrary, unless this Agreement is terminated in
accordance with Article VII, the Company will take all of the actions
contemplated by Section 5.4(a) and Section 5.4(b) regardless of
whether the Board of Directors of the Company (acting through the Special Committee,
if then in existence) has approved, endorsed or recommended an Alternative
Proposal or has made a Change of Recommendation, and will submit this Agreement
for adoption by the shareholders of the Company at the Company Meeting.  Notwithstanding anything to the contrary
contained in this Agreement, the Company shall not be required to hold the
Company Meeting if this Agreement is terminated in accordance with
Article VII.


Section 5.5             Stock
Options and Other Stock-Based Awards; Employee Matters.


(a)           Stock
Options and Other Stock-Based Awards.


(i)            Each
option to purchase shares of Company Common Stock (each, a “Company Stock
Option”) granted under the Company Stock Plans, whether vested or unvested,
that is outstanding immediately prior to the Effective Time shall, as of the
Effective Time, become fully vested and be converted into the right to receive
at the Effective Time an amount in cash in U.S. dollars equal to the product of
(x) the total number of shares of Company Common Stock subject to such Company
Stock Option and (y) the excess, if any, of the amount of the Merger
Consideration over the exercise price per share of Company Common Stock subject
to such Company Stock Option, with the aggregate amount of such payment rounded
to the nearest cent (the aggregate amount of such cash hereinafter referred to
as the “Option Consideration”) less such amounts as are required to be
withheld or deducted under the Code or any provision of U.S. state or local Tax
Law with respect to the making of such payment.



 36
 








(ii)           At
the Effective Time, each right of any kind, contingent or accrued, to receive
shares of Company Common Stock or benefits measured in whole or in part by the
value of a number of shares of Company Common Stock granted under the Company
Stock Plans or Company Benefit Plans (including restricted stock units, phantom
units, deferred stock units, stock equivalents and dividend equivalents), other
than Restricted Shares (as hereinafter defined), any rights under the Stock
Purchase Plan, and Company Stock Options (each, other than Restricted Shares,
rights under the Stock Purchase Plan and Company Stock Options, a “Company
Stock-Based Award”), whether vested or unvested, which is outstanding
immediately prior to the Effective Time shall cease to represent a right or
award with respect to shares of Company Common Stock, shall become fully vested
and shall entitle the holder thereof to receive, at the Effective Time an
amount in cash equal to the Merger Consideration in respect of each Share
underlying a particular Company Stock-Based Award (the aggregate amount of such
cash, together with the Option Consideration, hereinafter referred to as the “Option
and Stock-Based Consideration”) less such amounts as are required to be
withheld or deducted under the Code or any provision of U.S. state or local Tax
Law with respect to the making of such payment.


(iii)          Immediately
prior to the Effective Time, each award of restricted Company Common Stock (the
“Restricted Shares”) shall vest in full and be converted into the right
to receive the Merger Consideration as provided in Section 2.1(a), less such
amounts as are required to be withheld or deducted under the Code or any
provision of U.S. state or local Tax Law with respect to the making of such
payment.


(iv)          As
soon as practicable following the date of this Agreement, the Board of
Directors of the Company (or, if appropriate, any committee of the Board of
Directors of the Company administering the Company’s Employee Stock Purchase
Plan (the “Stock Purchase Plan”)) will adopt such resolutions and take
such other actions as may be required to provide that with respect to the Stock
Purchase Plan:  (A) participants in
the Stock Purchase Plan may not increase their payroll deductions or purchase election
from those in effect on the date of this Agreement, (B) no purchase period
will be commenced after the date of this Agreement (it being understood that
any purchase period in effect on the date of the Agreement may continue in
accordance with its terms), (C) the Stock Purchase Plan shall be terminated
effective immediately prior to the Effective Time and (D) the amount of
the accumulated contributions of each participant under the Stock Purchase Plan
as of immediately prior to the Effective Time shall be refunded to such
participant as promptly as practicable following the Effective Time (without
interest).


(v)           The
Compensation & Organization Committee of the Board of Directors of the
Company shall make such adjustments and amendments to or make such
determinations with respect to Company Stock Options, Company Stock-Based
Awards, Restricted Shares and rights under the Stock Purchase Plan to implement
the foregoing provisions of this Section 5.5.


(b)           Employee
Matters.


(i)            From
and after the Effective Time, the Surviving Corporation shall honor all Company
Benefit Plans and compensation arrangements and agreements in accordance 



 37
 








with their terms as in effect immediately before the Effective Time
(without giving effect to any amendments thereto after the Effective Time
except if consented to by the affected party). 
Notwithstanding any other provision of this Agreement to the contrary,
(A) the Surviving Corporation shall provide each current and former employee of
the Company and its Subsidiaries other than such employees covered by
collective bargaining agreements (“Company Employees”) whose employment
terminates during the one-year period following the Effective Time with
severance benefits at the levels and pursuant to the terms of the Company’s
severance plans and policies as in effect immediately prior to the Effective
Time (it being understood that Company Employees whose severance benefits are
otherwise addressed in Section 5.5(b)(iv) of the Company Disclosure
Schedule will be governed thereby), and (B) during such one-year period following
the Effective Time, severance benefits offered to Company Employees shall be
determined without taking into account any reduction after the Effective Time
in compensation paid to Company Employees. 
Except as provided in the last sentence of this Section 5.5(b)(i)
or in Section 5.5(b)(iv) or (v), nothing contained in this Agreement shall
be construed as requiring the Surviving Corporation to establish, maintain or
continue any specific plans. 
Furthermore, except as provided in the last sentence of this Section 5.5(b)(i)
or in Section 5.5(b)(iv) or (v), no provision of this Agreement shall be
construed as prohibiting or limiting the ability of the Surviving Corporation
to amend, modify or terminate, any plans, programs, policies, arrangements, agreements
or understandings of the Surviving Corporation or the Company.  Without limiting the scope of
Section 8.10, nothing herein shall confer any rights or remedies of any
kind or description upon any current or former employee of the Company and its
Subsidiaries or any other Person other than the ESOP, the Company and their
respective successors and assigns; provided, however, that the
last sentence of this Section 5.5(b)(i) shall be enforceable by and on
behalf of the beneficiaries of the Company’s Transitional Compensation Plan, as
in effect as of the date hereof (the “Transitional Compensation Plan”),
and their respective successors and assigns. 
Notwithstanding anything to the contrary contained in this Agreement,
the Surviving Corporation shall honor, fulfill and discharge the Company’s
obligations under the Transitional Compensation Plan, without any amendment or
change that is adverse to any beneficiary of such Transitional Compensation
Plan.


(ii)           For
all purposes (including purposes of vesting, eligibility to participate and
level of benefits) under any new employee benefit plans of Surviving
Corporation and its Subsidiaries providing benefits to any Company Employees
after the Effective Time (the “New Plans”), each Company Employee shall
be credited with his or her years of service with the Company and its
Subsidiaries and their respective predecessors before the Effective Time, to
the same extent as such Company Employee was entitled, before the Effective
Time, to credit for such service under any similar Company employee benefit
plan in which such Company Employee participated or was eligible to participate
immediately prior to the Effective Time; provided that the foregoing
shall not apply with respect to benefit accrual under any defined benefit
pension plan or to the extent that its application would result in a
duplication of benefits with respect to the same period of service.  In addition, and without limiting the
generality of the foregoing, (A) each Company Employee shall be
immediately eligible to participate, without any waiting time, in any and all
New Plans to the extent coverage under such New Plan is comparable to a Company
Benefit Plan in which such Company Employee participated immediately before the
Effective Time (such plans, collectively, the “Old Plans”), and
(B) for purposes of each New Plan providing medical, dental,
pharmaceutical and/or vision benefits to any Company Employee, all pre-existing
condition exclusions and actively-at-work requirements 



 38
 








of such New Plan shall be waived for such employee and his or her
covered dependents, unless such conditions would not have been waived under the
comparable Old Plans of the Company or its Subsidiaries in which such employee
participated immediately prior to the Effective Time and any eligible expenses
incurred by such employee and his or her covered dependents during the portion
of the plan year of the Old Plan ending on the date such employee’s
participation in the corresponding New Plan begins shall be taken into account
under such New Plan for purposes of satisfying all deductible, coinsurance and
maximum out-of-pocket requirements applicable to such employee and his or her
covered dependents for the applicable plan year as if such amounts had been
paid in accordance with such New Plan.


(iii)          The
ESOP and the Surviving Corporation each hereby acknowledges that a “change of
control” (or similar phrase) within the meaning of the Company Stock Plans and
the Company Benefit Plans, as applicable, will occur at or prior to the
Effective Time, as applicable.


(iv)          Notwithstanding
anything to the contrary contained in this Agreement, the Surviving Corporation
agrees to the additional matters set forth on Section 5.5(b)(iv) of the
Company Disclosure Schedule.


(v)           Immediately
following the Closing, the Surviving Corporation shall adopt an incentive plan
in accordance with the term sheet set forth in Section 5.5(b)(v) of the
Company Disclosure Schedule.  This
Section 5.5(b)(v) shall be enforceable by and on behalf of the
beneficiaries of the Transitional Compensation Plan.


Section 5.6             Reasonable
Best Efforts.


(a)           Subject
to the terms and conditions set forth in this Agreement, each of the Company,
the ESOP and Merger Sub shall use (and cause its affiliates to use) its
reasonable best efforts (subject to, and in accordance with, applicable Law) to
take promptly, or cause to be taken promptly, all actions, and to do promptly,
or cause to be done promptly, and to assist and cooperate with the other
parties in doing, all things necessary, proper or advisable under applicable
Laws to consummate and make effective the Merger and the other transactions
contemplated by this Agreement, including (i) the obtaining of all necessary
actions or nonactions, waivers, consents and approvals, including the Company
Approvals and the ESOP Approvals, from Governmental Entities and the making of
all necessary registrations and filings and the taking of all steps as may be
necessary to obtain an approval or waiver from, or to avoid an action or
proceeding by, any Governmental Entity, (ii) the obtaining of all
necessary consents, approvals or waivers from third parties and all consents,
approvals and waivers from third parties reasonably requested by the ESOP to be
obtained in respect of the Company Material Contracts in connection with the
Merger, this Agreement or the transactions contemplated by this Agreement (it
being understood that the failure to receive any such consents, approvals or
waivers shall not be a condition to the ESOP’s and Merger Sub’s obligations
hereunder, except with respect to the consents set forth on Section 6.1(d) of
the Company Disclosure Schedule), (iii) the defending of any lawsuits or other
legal proceedings, whether judicial or administrative, challenging this
Agreement or the consummation of the Merger or the other transactions
contemplated by this Agreement and (iv) the execution and delivery of any
additional instruments necessary to consummate the Merger and the other
transactions contemplated by this 



 39
 








Agreement; provided, however, that in no event shall the
ESOP, Merger Sub, the Company or any of its Subsidiaries be required to pay
prior to the Effective Time any fee, penalty or other consideration to any
third party for any consent or approval required for the consummation of the
transactions contemplated by this Agreement under any contract or agreement.


(b)           Subject
to the terms and conditions herein provided and without limiting the foregoing,
the Company and the ESOP shall (i) promptly, (A) but in no event later
than fifteen (15) days after the date hereof, make their respective filings and
thereafter make any other required submissions under the HSR Act, and (B) but
in no event later than thirty (30) days after the date hereof, make their
respective filings and thereafter make any other required submissions under the
with the FCC to obtain the FCC Order (the “FCC Applications”), (ii) use
reasonable best efforts to cooperate with each other in (x) determining
whether any filings are required to be made with, or consents, permits,
authorizations, waivers or approvals are required to be obtained from, any
third parties or other Governmental Entities in connection with the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby and (y) timely making all such filings and timely
seeking all such consents, permits, authorizations or approvals, (iii) use
reasonable best efforts to take, or cause to be taken, all other actions and
do, or cause to be done, all other things necessary, proper or advisable to consummate
and make effective the transactions contemplated hereby, including taking all
such further action as reasonably may be necessary to resolve such objections,
if any, as the FCC, the United States Federal Trade Commission, the Antitrust
Division of the United States Department of Justice, state antitrust
enforcement authorities or competition authorities of any other nation or other
jurisdiction or any other person may assert under Regulatory Law (as
hereinafter defined) with respect to the transactions contemplated hereby, and
to avoid or eliminate each and every impediment under any Law that may be
asserted by any Governmental Entity with respect to the Merger so as to enable
the Closing to occur as soon as reasonably possible (and in any event no later
than the End Date (as hereinafter defined)),  including, without limitation (x) proposing, negotiating,
committing to and effecting, by consent decree, hold separate order, trust or
otherwise, the sale, divestiture or disposition of such assets or businesses of
the ESOP or its Subsidiaries or affiliates or of the Company or its
Subsidiaries and (y) otherwise taking or committing to take actions that after
the Closing Date would limit the freedom of the ESOP or its Subsidiaries’
(including the Surviving Corporation’s) or affiliates’ freedom of action with
respect to, or its ability to retain, one or more of its or its Subsidiaries’
(including the Surviving Corporation’s) businesses, product lines or assets, in
each case as may be required in order to avoid the entry of, or to effect the
dissolution of, any injunction, temporary restraining order or other order in
any suit or proceeding which would otherwise have the effect of preventing or
materially delaying the Closing, (iv) promptly inform the other party upon
receipt of any material communication from the FCC, the United States Federal
Trade Commission, the Antitrust Division of the United States Department of
Justice or any other Governmental Entity regarding any of the transactions
contemplated by this Agreement and (v) subject to applicable legal limitations
and the instructions of any Governmental Entity, keep each other apprised of
the status of matters relating to the completion of the transactions
contemplated thereby, including promptly furnishing the other with copies of
notices or other communications received by the Company or the ESOP, as the
case may be, or any of their respective Subsidiaries, from any third party
and/or any Governmental Entity with respect to such transactions.  The Company
and the ESOP shall permit counsel for the other party reasonable opportunity to
review in advance, and consider in good faith the views of the other party in
connection with, any proposed written 



 40
 








communication to any Governmental
Entity.  Each of the Company and the ESOP
agrees not to (A) participate in any substantive meeting or discussion,
either in person or by telephone, with any Governmental Entity in connection
with the proposed transactions unless it consults with the other party in
advance and, to the extent not prohibited by such Governmental Entity, gives
the other party the opportunity to attend and participate,
(B) extend any waiting period under the HSR Act without the prior written
consent of the other party (such consent not to be unreasonably withheld,
conditioned or delayed) or (C) enter into any agreement with any
Governmental Entity not to consummate the transactions contemplated by this
Agreement without the prior written consent of the other party (such consent
not to be unreasonably withheld, conditioned or delayed).


(c)           In
furtherance and not in limitation of the covenants of the parties contained in
this Section 5.6, if any administrative or judicial action or proceeding,
including any proceeding by a private party, is instituted (or threatened to be
instituted) challenging any transaction contemplated by this Agreement as
violative of any Regulatory Law, each of the Company and the ESOP shall
cooperate in all respects with each other and shall use their respective
reasonable best efforts to contest and resist any such action or proceeding and
to have vacated, lifted, reversed or overturned any decree, judgment,
injunction or other order, whether temporary, preliminary or permanent, that is
in effect and that prohibits, prevents or restricts consummation of the
transactions contemplated by this Agreement. 
Notwithstanding the foregoing or any other provision of this Agreement,
nothing in this Section 5.6 shall limit a party’s right to terminate this
Agreement pursuant to Section 7.1(b) or 7.1(c) so long as such party has, prior
to such termination, complied with its obligations under this Section 5.6.


(d)           For
purposes of this Agreement, “Regulatory Law” means the Communications
Act, the Sherman Act of 1890, the Clayton Antitrust Act of 1914, the HSR Act,
the Federal Trade Commission Act of 1914 and all other federal, state or
foreign statutes, rules, regulations, orders, decrees, administrative and
judicial doctrines and other Laws, including without limitation any antitrust,
competition or trade regulation Laws, that are designed or intended to (i)
prohibit, restrict or regulate actions having the purpose or effect of
monopolization or restraint of trade or lessening competition through merger or
acquisition, (ii) regulate media ownership or (iii) protect the national
security or the national economy of any nation.


(e)           The
ESOP and the Company acknowledge that license renewal applications (each, a “Renewal
Application”) may be pending before the FCC with respect to one or more
Company Stations (each, a “Renewal Station”).  In order to avoid disruption or delay in the
processing of the FCC Applications, the ESOP and the Company agree, as part of
the FCC Applications, to request that the FCC apply its policy permitting the
processing of license assignments and transfers in transactions involving
multiple markets, notwithstanding the pendency of one or more license renewal
applications.  The ESOP and the Company
agree to make such representations and undertakings as are reasonably necessary
or appropriate to invoke such policy, including undertakings to assume the
position of applicant with respect to any pending Renewal Application, and to
assume the risks relating to such Renewal Application.  To the extent reasonably necessary to
expedite grant of a Renewal Application, and thereby facilitate grant of the
FCC Applications, the ESOP and the Company shall enter into tolling agreements
with the FCC with respect to the relevant Renewal Application as reasonably 



 41
 








necessary or appropriate to extend the statute of limitations for the
FCC to determine or impose a forfeiture penalty against such Renewal Station in
connection with any pending complaints, investigations, letters of inquiry or
other proceedings, including complaints that such Renewal Station aired
programming that contained obscene, indecent or profane material (a “Tolling
Agreement”).  The ESOP and the
Company shall consult in good faith with each other prior to entering into any
such Tolling Agreement.  Section 5.6(e)
of the Company Disclosure Schedule sets forth each Renewal Application pending
as of the date of this Agreement and describes any challenge, petition or
investigation that, to the knowledge of the Company, is pending or threatened
by or before the FCC against such Renewal Application.


Section 5.7             Takeover
Statute.  If any “fair price,” “moratorium,”
“control share acquisition” or other form of antitakeover statute or regulation
shall become applicable to the transactions contemplated hereby, each of the
Company and the ESOP and the Board of Directors of the Company shall grant such
approvals and take such actions as are reasonably necessary so that the
transactions contemplated hereby may be consummated as promptly as practicable
on the terms contemplated hereby and otherwise act to eliminate or minimize the
effects of such statute or regulation on the transactions contemplated hereby.


Section 5.8             Public
Announcements.  The Company and the
ESOP will consult with and provide each other the reasonable opportunity to
review and comment upon any press release or other public statement or comment
prior to the issuance of such press release or other public statement or
comment relating to this Agreement or the transactions contemplated herein and
shall not issue any such press release or other public statement or comment
prior to such consultation except as may be required by applicable Law or by
obligations pursuant to any listing agreement with any national securities
exchange.  The ESOP and the Company agree
to issue a joint press release, together with Tribune Acquisition, announcing
this Agreement.


Section 5.9             Indemnification
and Insurance.


(a)           For
a period of six (6) years from the Effective Time, the Surviving Corporation
shall maintain in effect the exculpation, indemnification and advancement of
expenses provisions no less favorable than those of the Company’s and any
Company Subsidiary’s certificate of incorporation and by-laws or similar
organization documents in effect immediately prior to the Effective Time or in
any indemnification agreements of the Company or its Subsidiaries with any of
their respective directors, officers or employees in effect immediately prior
to the Effective Time, and shall not amend, repeal or otherwise modify any such
provisions in any certificate of incorporation, by-laws or similar
organizational documents, for a period of six (6) years from the Effective
Time, in any manner that would adversely affect the rights thereunder of any
individuals who at the Effective Time were current or former directors, officers
or employees of the Company or any of its Subsidiaries (it being understood
that any indemnification agreement shall remain in effect in accordance with
its terms); provided, however, that all rights to indemnification
in respect of any Action (as hereinafter defined) pending or asserted or any
claim made within such period shall continue until the disposition of such
Action or resolution of such claim.


(b)           The
Surviving Corporation shall, to the fullest extent permitted under applicable
Law, indemnify and hold harmless (and advance funds in respect of each of the 



 42
 








foregoing) each current and former director, officer or employee of the
Company or any of its Subsidiaries and each person who served as a director,
officer, member, trustee or fiduciary of another corporation, partnership,
joint venture, trust, pension or other employee benefit plan or enterprise at
the request of the Company, in and to the extent of their capacities as such
and not as shareholders and/or equity holders of the Company or its
Subsidiaries or otherwise (each, together with such person’s heirs, executors
or administrators, an “Indemnified Party”) against any costs or expenses
(including advancing attorneys’ fees and expenses in advance of the final
disposition of any claim, suit, proceeding or investigation to each Indemnified
Party to the fullest extent permitted by law), judgments, fines, losses,
claims, damages, liabilities and amounts paid in settlement in connection with
any actual or threatened claim, action, suit, proceeding or investigation,
whether civil, criminal, administrative or investigative (an “Action”),
arising out of, relating to or in connection with any action or omission
occurring or alleged to have occurred whether before or after the Effective
Time (including acts or omissions in connection with such persons serving as an
officer, director or other fiduciary in any entity if such service was at the
request or for the benefit of the Company). 
In the event of any such Action, the Surviving Corporation shall cooperate
with the Indemnified Party in the defense of any such Action.


(c)           For
a period of six (6) years from the Effective Time, the Surviving Corporation
shall cause to be maintained in effect the current policies of directors’ and
officers’ liability insurance and fiduciary liability insurance maintained by
the Company and its Subsidiaries with respect to matters arising on or before
the Effective Time; provided, however, that after the Effective
Time, the ESOP shall not be required to pay annual premiums in excess of 200%
of the last annual premium paid by the Company prior to the date hereof in
respect of the coverages required to be obtained pursuant hereto (such 200%
amount, the “Maximum Premium”), but in such case shall purchase as much
coverage as reasonably practicable for such amount.  At the Company’s option, after consultation
with the ESOP, the Company may purchase prior to the Effective Time, a six-year
prepaid “tail” policy or policies (at an aggregate cost not exceeding the
Maximum Premium times six) on terms and conditions providing substantially
equivalent benefits as the current policies of directors’ and officers’
liability insurance and fiduciary liability insurance maintained by the Company
and its Subsidiaries with respect to matters arising on or before the Effective
Time, covering without limitation the transactions contemplated hereby.  If such “tail” prepaid policy or policies has
or have been obtained by the Company prior to the Effective Time, the Surviving
Corporation shall cause such policies to be maintained in full force and
effect, for its full term, and cause all obligations thereunder to be honored
by the Surviving Corporation, and no other party shall have any further
obligation to purchase or pay for insurance hereunder.  The Company represents that the Maximum
Premium is $7,915,164.


(d)           The
Surviving Corporation shall pay all reasonable expenses, including reasonable
attorneys’ fees, that may be incurred by any Indemnified Party in enforcing the
indemnity and other obligations provided in this Section 5.9.


(e)           The
rights of each Indemnified Party hereunder shall be in addition to, and not in
limitation of, any other rights such Indemnified Party may have under the
certificate of incorporation or by-laws or other organization documents of the
Company or any of its Subsidiaries or the Surviving Corporation, any other
indemnification agreement or arrangement, the DGCL or otherwise.  The provisions of this Section 5.9 shall
survive the consummation of 



 43
 








the Merger in accordance with their terms and expressly are intended to
benefit, and are enforceable by, each of the Indemnified Parties.


(f)            In
the event the Surviving Corporation or any of its successors or assigns (i)
consolidates with or merges into any other person and shall not be the
continuing or surviving corporation or entity in such consolidation or merger
or (ii) transfers all or substantially all of its properties and assets to any
person, then, and in either such case, proper provision shall be made so that
the successors and assigns of the Surviving Corporation shall assume the
obligations set forth in this Section 5.9.


Section 5.10           Control
of Operations.  Nothing contained in
this Agreement shall give the ESOP, directly or indirectly, the right to
control or direct the Company’s operations prior to the Effective Time.  Prior to the Effective Time, the Company
shall exercise, consistent with the terms and conditions of this Agreement,
complete control and supervision over its operations.


Section 5.11           Financing.


(a)           Section
5.11 of the Company Disclosure Schedule sets forth a true, accurate and
complete copy of those certain commitment letters, letter agreements and
related fee letters (collectively, the “Debt Commitment Letters”), dated
April 1, 2007, from Merrill Lynch Capital Corporation, Citigroup Global
Markets Inc. and JPMorgan Securities Inc. to the Company (the “Financing
Commitments”) pursuant to which, and subject to the terms and conditions
thereof, certain lenders have committed to provide the Company with loans in
the amounts described therein, the proceeds of which may be used to consummate
the Merger, the Offer and the other transactions contemplated hereby (the “Financing”).  The Company shall use reasonable best efforts
to obtain the Financing on the terms and conditions described in the Financing
Commitments, including using reasonable best efforts (i) to negotiate
definitive agreements with respect thereto on the terms and conditions
contained in the Financing Commitments, (ii) to satisfy on a timely basis all
conditions applicable to the Company in such Financing Commitments, including,
without limitation, conditions related to the payment of fees and expenses of
the lead arrangers, the preparation and delivery to the lead arrangers of
offering materials related to the Senior Notes (as defined in the Debt
Commitment Letters), and the provision of information relating to the financial
and operating results of the Company, (iii) to comply with its obligations
under the Financing Commitments and (iv) to enforce its rights under the
Financing Commitments.  The Company shall
give the ESOP prompt notice upon becoming aware of any material breach by any
party of the Financing Commitments or any termination of the Financing Commitments.  Upon reasonable request, the Company shall
inform the ESOP in reasonable detail of the status of its efforts to arrange
the Financing and shall not permit any amendment or modification to be made to,
or any waiver of any material provision or remedy under, the Debt Commitment
Letter if such amendment, modification, waiver or remedy reduces the aggregate
amount of the Financing, or amends the conditions to the drawdown of the
Financing or any other terms thereof in any respect that could be reasonably
expected to affect the availability of the Financing or delay the Closing, in
each case, in any material respect.  In
the event that the Company becomes aware of any event or circumstance that
makes procurement of any portion of the Financing unlikely to occur in the
manner or from the sources



 44















substantially
consistent with the Financing Commitments, the Company shall promptly notify
the ESOP and shall use reasonable best efforts to arrange any such portion from
alternative sources.


(b)           The ESOP will and
will cause its Representatives to, at the Company’s sole expense, cooperate
reasonably with the Company and its authorized Representatives in connection
with the arrangement, negotiation and closing of the Financing and the issuance
of the Senior Notes (as defined in the Debt Commitment Letters), including (i)
participation in a reasonable number of meetings on reasonable advance notice,
(ii) furnishing information (including any financial statements)
reasonably required to be included in the preparation of offering memoranda,
private placement memoranda, prospectuses and similar documents, and (iii)
cooperation and assistance in respect of the preparation, negotiation,
execution and closing of any underwriting or placement agreements, indentures,
credit agreements, pledge and security documents, other definitive financing
documents; provided, that, without limiting the obligations of the ESOP
under this Section 5.11(b), the ESOP shall not be required to become subject to
any obligations relating to such activities prior to the Closing; and provided,
further, that any information provided to the Company pursuant to this
Section 5.11(b) shall be subject to the applicable Confidentiality Agreement
other than information included in any offering memoranda, private placement
memoranda, prospectuses and similar documents.


Section 5.12           Specified
Divestitures. The Company shall, and/or shall cause one or more of its
Subsidiaries, to: (a) promptly after the date hereof, use commercially
reasonable efforts (at the Company’s sole expense) to commence a process by
which the Company will or will cause one or more of its Subsidiaries to sell
all of the assets or equity or other ownership interests owned or held by the
Company and/or any of its Subsidiaries in the businesses identified on
Section 5.12 of the Company Disclosure Schedule (the “Divestitures”
and each a “Divestiture”), (b) coordinate with the ESOP and its
advisors on all material aspects of the sale process and strategy in effecting
the Divestitures, including any public announcements related thereto, (c) coordinate
with the ESOP and its advisors on all material terms, conditions and
obligations of a proposed Divesture, including transaction structure and
timing, price, form of consideration, tax considerations, representations and
warranties, indemnification obligations and other material terms, conditions
and obligations, and (d) provide the ESOP and its advisors with a
reasonable opportunity to review and comment upon any material transaction
documents related to a proposed Divestiture. Nothing in this Agreement shall be
deemed to require the Company to consummate any such Divestiture or to enter
into any agreement for such Divestiture that is not conditioned on the closing
of the Merger.


Section 5.13           FCC
Matters. During the period from the date of this Agreement to the Effective
Time or the date, if any, on which this Agreement is terminated pursuant to
Article VII, the Company shall, and shall cause each of its Subsidiaries
to: (i) comply in all material respects with all material requirements of
the FCC applicable to the construction or operation of a Company Station,
(ii) promptly deliver to the ESOP copies of any material reports,
applications, petitions, objections or responses filed with the FCC with
respect to a Company Station, (iii) promptly notify the ESOP of any
material inquiry, investigation or proceeding initiated by the FCC relating to
a Company Station, (iv) maintain in effect all of the Company FCC Licenses
material to the operation of a Company Station and (v) not make or revoke
any election with the FCC if such election or revocation would be material and
adverse, individually or in the aggregate, to the Company or any of its
Subsidiaries.



 45
 









Section 5.14           Company
Offer.


(a)           As promptly as
reasonably practicable after the date hereof, the Company shall commence
(within the meaning of Rule 14d-2 under the Exchange Act) a tender offer (as it
may be amended from time to time in accordance with this Agreement, the “Offer”)
to purchase up to approximately 126 million shares of Company Common Stock at a
price of $34 per share (such amount, or any different amount per share offered
pursuant to the Offer in accordance with the terms of this Agreement, the “Offer
Price”). The Offer shall be subject to the conditions set forth in
Section 5.14 of the Company Disclosure Schedule. The Company expressly
reserves the right (subject to the terms of the Tribune Purchase
Agreement) to waive any of the conditions to the Offer and to make any
change in the terms of or conditions to the Offer. Subject to the terms and
conditions of this Agreement and the Offer, the Offer shall expire at midnight,
New York City time, on the date that is 20 business days (for this purpose
calculated in accordance with Section 14d-1(g)(3) under the Exchange Act)
after the date that the Offer is commenced, unless extended.


(b)           As soon as
practicable on the date of commencement of the Offer, the Company shall (i)
file with the SEC (A) a Tender Offer Statement on Schedule TO with respect to
the Offer (together with all amendments and supplements thereto and including
exhibits thereto, the “Schedule TO”) that shall include the summary term
sheet required thereby and, as exhibits or incorporated by reference thereto,
the Offer to Purchase and forms of letter of transmittal and summary advertisement,
if any, in respect of the Offer (collectively, together with any amendments or
supplements thereto, the “Offer Documents”) and (B) a Rule 13E-3
Transaction Statement on Schedule 13E-3 (the “TO Schedule 13E-3”), if
required, and (ii) cause the Offer Documents to be disseminated to holders
of Company Common Stock. The ESOP and its counsel shall be given a reasonable
opportunity to review and comment on the Schedule TO, the Offer Documents and
the TO Schedule 13E-3 each time before any such document is filed with the SEC,
and the Company shall give reasonable and good faith consideration to any
comments made by the ESOP and its counsel.


(c)           If the Offer is not
consummated, this Agreement shall nevertheless remain in full force and effect
in accordance with the terms hereof, and the Merger shall be consummated in
accordance with the terms and subject to the conditions hereof.


Section 5.15           Eagles
Exchange. In the event that any shares of Company Common Stock or Series
D-1 Preferred Stock are owned or held by the Eagle Entities on any day that is
less than 20 business days prior to Closing, the Company shall, and the Company
shall cause the Eagle Entities to, (a) enter into an Exchange Agreement
substantially in the form attached hereto as Exhibit C, which provides
for Eagle New Media and Eagle Publishing to agree, on the terms and subject to
the conditions set forth in the form of Exchange Agreement, to exchange (the “Exchange”)
all of the outstanding Company Common Stock and Series D-1 Preferred Stock held
by them for shares of newly designated and issued Series E Preferred
Stock, without par value, of the Company (the “Series E Preferred Stock”),
with such terms and conditions as are necessary to provide for a fair value
exchange and are reflected in a form of Certificate of Designation that will be
attached as an exhibit to the Exchange Agreement (the “Certificate of
Designation”), and (b) to consummate the Exchange prior to Closing.



 46
 









ARTICLE VI


CONDITIONS TO THE MERGER


Section 6.1             Conditions
to Each Party’s Obligation to Effect the Merger. The respective obligations
of each party to effect the Merger shall be subject to the fulfillment (or
waiver by all parties) at or prior to the Effective Time of the following
conditions (provided, however, that neither the ESOP nor Merger
Sub shall be permitted to waive any condition hereunder without the express
written consent of Tribune Acquisition):


(a)           The Company
Shareholder Approval shall have been obtained.


(b)           No restraining
order, injunction or other order by any court or other tribunal of competent
jurisdiction which prohibits the consummation of the Merger shall have been
entered and shall continue to be in effect.


(c)           Any applicable
waiting period under the HSR Act shall have expired or been earlier terminated and
the FCC Order shall have been obtained.


(d)           The consents and
approvals set forth on Section 6.1(d) of the Company Disclosure Schedule shall
have been received.


(e)           The Exchange shall
have been consummated in accordance with the terms of the Exchange Agreement,
unless the Eagle Entities do not then own or hold any shares of Company Common
Stock or Series D-1 Preferred Stock as a result of a liquidation,
distribution or otherwise.


(f)            All of the
conditions precedent to the consummation of the purchase of the Subordinated
Note and the Warrant contemplated by the Tribune Purchase Agreement shall have
been satisfied or waived (other than consummation of the Merger) such that such
purchases shall occur immediately following the consummation of the Merger.


(g)           The Company shall
have obtained the Financing on the terms set forth in the Financing
Commitments, or alternative financing on substantially similar terms that are
not materially more onerous than the terms reflected in such Financing
Commitments, sufficient to consummate the Merger and the transactions
contemplated by this Agreement.


Section 6.2             Conditions
to Obligation of the Company to Effect the Merger. The obligation of the
Company to effect the Merger is further subject to the fulfillment of the following
conditions:


(a)           The representations
and warranties of the ESOP and Merger Sub set forth herein shall be true and
correct both when made and at and as of the Closing Date, as if made at and as
of such time (except to the extent expressly made as of an earlier date, in
which case as of such date), except where the failure of such representations
and warranties to be so true and correct (without giving effect to any
limitation as to “materiality” or “material adverse effect” qualifiers set
forth therein) would not have, individually or in the aggregate, an ESOP
Material Adverse Effect.



 47
 









(b)           The ESOP shall have
in all material respects performed all obligations and complied with all
covenants required by this Agreement to be performed or complied with by it
prior to the Effective Time.


(c)           The FCC Order shall
not impose any condition on the ESOP, the Company or any Subsidiary of the
Company that, individually or in combination with one or more other conditions,
would reasonably be expected to have a material adverse effect on the business,
assets, financial condition, results of operations on an ongoing basis or
continuing operations of the broadcasting business of the Company and its
Subsidiaries, taken as a whole.


(d)           The ESOP shall have
delivered to the Company a certificate, dated the Effective Time and signed on
its behalf by the ESOP Fiduciary, certifying to the effect that the conditions
set forth in Sections 6.2(a) and 6.2(b) have been satisfied.


(e)           The Company shall
have obtained an opinion from Valuation Research Corporation or another
nationally recognized firm reasonably satisfactory to the Company, in form and
substance reasonably satisfactory to the Company, as to the solvency of the
Company after giving effect to the transactions contemplated by this Agreement
(including any financing in connection with the transactions contemplated
hereby and including the closing of the transactions contemplated by the
Tribune Purchase Agreement and the ESOP Purchase Agreement).


Section 6.3             Conditions
to Obligations of the ESOP and Merger Sub to Effect the Merger. The
obligations of the ESOP and Merger Sub to effect the Merger is further subject
to the fulfillment of the following conditions (provided, however,
that neither the ESOP nor Merger Sub shall be permitted to waive any condition
hereunder without the express written consent of Tribune Acquisition):


(a)           (i)  The representations and warranties of the
Company set forth in Section 3.2(a) and (d) shall be true and correct in all
material respects, (ii) the representations and warranties of the Company
set forth in Sections 3.10(a)(ii) and (b) shall be true and correct in all
respects and (iii) the other representations and warranties of the Company set
forth herein shall be true and correct both when made and at and as of the
Closing Date, as if made at and as of such time (except to the extent expressly
made as of an earlier date, in which case as of such date), except where the
failure of such representations and warranties to be so true and correct (without
giving effect to any limitation as to “materiality” or “material adverse effect”
qualifiers set forth therein) would not have, individually or in the aggregate,
a Company Material Adverse Effect.


(b)           The Company shall
have in all material respects performed all obligations and complied with all
covenants required by this Agreement to be performed or complied with by it
prior to the Effective Time.


(c)           The Company shall
have delivered to the ESOP a certificate, dated the Effective Time and signed
by its Chief Executive Officer or another senior officer, certifying to the
effect that the conditions set forth in Sections 6.3(a) and (b) have been
satisfied.



 48
 









Section 6.4             Frustration
of Closing Conditions. Neither the Company nor the ESOP may rely, either as
a basis for not consummating the Merger or terminating this Agreement and
abandoning the Merger, on the failure of any condition set forth in Sections
6.1, 6.2 or 6.3, as the case may be, to be satisfied if such failure was caused
by such party’s breach of any provision of this Agreement or failure to use its
reasonable best efforts to consummate the Merger and the other transactions
contemplated hereby, as required by and subject to Section 5.6.


ARTICLE VII


TERMINATION


Section 7.1             Termination
or Abandonment. Notwithstanding anything contained in this Agreement to the
contrary, this Agreement may be terminated and abandoned at any time prior to
the Effective Time, as follows:


(a)           by the mutual
written consent of the Company and the ESOP;


(b)           by either the Company
or the ESOP if (i) the Effective Time shall not have occurred on or before
May 31, 2008 (the “End Date”) and (ii) the party seeking to
terminate this Agreement pursuant to this Section 7.1(b) shall not have
breached in any material respect its obligations under this Agreement in any
manner that shall have proximately caused the failure to consummate the Merger
on or before such date;


(c)           by either the
Company or the ESOP if an injunction, order, decree or ruling shall have been
entered permanently restraining, enjoining or otherwise prohibiting the
consummation of the Merger and such injunction, order, decree or ruling shall
have become final and non-appealable, provided that the party seeking to
terminate this Agreement pursuant to this Section 7.1(c) shall have used its
reasonable best efforts to remove such injunction, order, decree or ruling; and
provided, further, that the right to terminate this Agreement
under this Section 7.1(c) shall not be available to a party if such final,
non-appealable injunction, order, decree or ruling was primarily due to the
failure of such party to perform any of its obligations under this Agreement;


(d)           by either the
Company or the ESOP if the Company Meeting (including any adjournments or
postponements thereof) shall have concluded and the Company Shareholder
Approval contemplated by this Agreement shall not have been obtained;


(e)           by the Company, if
the Company is not in material breach of any of its representations,
warranties, covenants or other agreements contained in this Agreement and if
the ESOP shall have breached or failed to perform in any material respect any
of its representations, warranties, covenants or other agreements contained in
this Agreement, which breach or failure to perform by the ESOP (i) would result
in a failure of a condition set forth in Section 6.1 or 6.2 and (ii) cannot be
cured by the End Date; provided that the Company shall have given the
ESOP written notice, delivered at least thirty (30) days prior to such
termination, stating the Company’s intention to terminate this Agreement
pursuant to this Section 7.1(e) and the basis for such termination;



 49
 









(f)            by the ESOP, if the
ESOP is not in material breach of any of its representations, warranties,
covenants or other agreements contained in this Agreement and if the Company
shall have breached or failed to perform in any material respect any of its
representations, warranties, covenants or other agreements contained in this
Agreement, which breach or failure to perform by the Company (i) would result
in a failure of a condition set forth in Section 6.1 or 6.3 and (ii) cannot be
cured by the End Date; provided that the ESOP shall have given the
Company written notice, delivered at least thirty (30) days prior to such
termination, stating the ESOP’s intention to terminate this Agreement pursuant
to this Section 7.1(f) and the basis for such termination;


(g)           by the Company,
prior to the Company Shareholder Approval, if the Board of Directors of the
Company or the Special Committee determines to accept a Superior Proposal; provided,
however, that (i) the Company shall have provided written notice to
the ESOP (a “Notice of Superior Proposal”) advising the ESOP that the
Board of Directors of the Company or the Special Committee has received a
Superior Proposal, specifying in writing the material terms and conditions of
such Superior Proposal and the identity of the person making the proposal and
providing the ESOP with a copy thereof (if in writing), (ii) at least
three (3) business days following receipt by the ESOP of the Notice of Superior
Proposal, and taking into account any revised proposal made by the ESOP since
receipt of the Notice of Superior Proposal, the Board of Directors of the
Company or the Special Committee shall have concluded that such Superior
Proposal remains a Superior Proposal; provided that during such three
(3) business day period, at the ESOP’s request, the Company shall cooperate and
negotiate with the ESOP in connection with the ESOP’s efforts to make such a
revised proposal; and provided, further, that in the event of any
material change to the terms of such Superior Proposal, the Board of Directors
of the Company or the Special Committee shall deliver to the ESOP an additional
Notice of Superior Proposal, and the three (3) business day period referenced
above shall be extended for an additional forty-eight (48) hours, (iii) the
Company shall be in compliance with Section 5.3, (iv) the Board of Directors of
the Company shall concurrently approve, and the Company shall concurrently enter
into, a definitive agreement providing for the implementation of such Superior
Proposal and (v) the Company shall have given the ESOP forty-eight (48)
hours’ written notice of its intention to terminate this Agreement pursuant to
this Section 7.1(g), which notice period may run concurrently with any
notice period contemplated by clause (ii) above;


(h)           by the ESOP, prior
to the Company Shareholder Approval, if the Board of Directors of the Company
has failed to make the Recommendation in the Proxy Statement or has effected a
Change of Recommendation in a manner adverse to the ESOP; and


(i)            by the Company, if
the consummation of the purchase of Company Common Stock and the Subordinated
Exchangeable Note pursuant to the Tribune Purchase Agreement shall not have
occurred on or prior to August 17, 2007 or if the Tribune Purchase
Agreement is terminated in accordance with its terms prior to the Effective
Time.


In the
event of termination of this Agreement pursuant to this Section 7.1, this
Agreement shall terminate (except for Article VIII, which shall survive such
termination), and there shall be no other liability on the part of the Company,
the ESOP or Merger Sub, except as provided in Section 8.20 of the Tribune
Purchase Agreement.



 50
 









ARTICLE VIII


MISCELLANEOUS


Section 8.1             No
Survival of Representations and Warranties. None of the representations and
warranties in this Agreement or in any instrument delivered pursuant to this
Agreement shall survive the Merger.


Section 8.2             Expenses.
Whether or not the Merger is consummated, all costs and expenses incurred by
the Company, the ESOP, the ESOP Fiduciary or Merger Sub in connection with the
Merger, this Agreement and the transactions contemplated hereby shall be paid
by the Company.


Section 8.3             Counterparts;
Effectiveness. This Agreement may be executed in two or more consecutive
counterparts (including by facsimile), each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument, and shall become effective when one or more counterparts have been
signed by each of the parties and delivered (by telecopy or otherwise) to the
other parties.


Section 8.4             Governing
Law. This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware, without giving effect to any choice or
conflict of law provision or rule (whether of the State of Delaware or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Delaware.


Section 8.5             Jurisdiction;
Enforcement. The parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement exclusively in the Delaware Court of
Chancery and any state appellate court therefrom within the State of Delaware
(or, if the Delaware Court of Chancery declines to accept jurisdiction over a
particular matter, any state or federal court within the State of Delaware). In
addition, each of the parties hereto irrevocably agrees that any legal action
or proceeding with respect to this Agreement and the rights and obligations
arising hereunder, or for recognition and enforcement of any judgment in
respect of this Agreement and the rights and obligations arising hereunder
brought by the other party hereto or its successors or assigns, shall be
brought and determined exclusively in the Delaware Court of Chancery and any
state appellate court therefrom within the State of Delaware (or, if the
Delaware Court of Chancery declines to accept jurisdiction over a particular
matter, any state or federal court within the State of Delaware). Each of the
parties hereto hereby irrevocably submits with regard to any such action or
proceeding for itself and in respect of its property, generally and unconditionally,
to the personal jurisdiction of the aforesaid courts and agrees that it will
not bring any action relating to this Agreement or any of the transactions
contemplated by this Agreement in any court other than the aforesaid courts.
Each of the parties hereto hereby irrevocably waives, and agrees not to assert,
by way of motion, as a defense, counterclaim or otherwise, in any action or
proceeding with respect to this Agreement, (a) any claim that it is not
personally subject to the jurisdiction of the above named courts for any reason



 51
 









other than the failure to
serve in accordance with this Section 8.5, (b) any claim that it or its
property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (c) to the fullest extent permitted by
the applicable law, any claim that (i) the suit, action or proceeding in such
court is brought in an inconvenient forum, (ii) the venue of such suit, action
or proceeding is improper or (iii) this Agreement, or the subject mater hereof,
may not be enforced in or by such courts.


Section 8.6             WAIVER
OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.


Section 8.7             Notices.
Any notice required to be given hereunder shall be sufficient if in writing,
and sent by facsimile transmission (provided that any notice received by
facsimile transmission or otherwise at the addressee’s location on any business
day after 5:00 p.m. (addressee’s local time) shall be deemed to have been
received at 9:00 a.m. (addressee’s local time) on the next business day), by
reliable overnight delivery service (with proof of service), hand delivery or
certified or registered mail (return receipt requested and first-class postage
prepaid), addressed as follows:


To the
ESOP or Merger Sub:


Tribune Employee Stock Ownership Trust 

c/o Greatbanc Trust Company, Trustee 

1301 West 22nd Street, Suite 702 

Oak Brook, Il  60523 

Attn: Marilyn Marchetti and Danielle Montesano 

Tel: (630) 572-5121 and (630) 572-5120 

Fax: (630) 571-0599


with
copies to:


K & L Gates 

535 Smithfield Street 

Pittsburgh, PA  15222 

Attn: Charles R. Smith, Esq. 

Tel: (412) 355-6536 

Fax: (412) 355-6501


and with additional copies to Tribune Acquisition and
its copied parties.


To the
Company:


Tribune Company


435 North Michigan
Avenue


Chicago, IL 60611



 52
 









Attn: c/o Crane H.
Kenney


Senior Vice
President, General Counsel & Secretary


Tel: (312)
222-2491


Fax: (312) 222-4206


with
copies to:


Wachtell, Lipton,
Rosen & Katz


51 West 52nd
Street


New York, NY 10019


Attn: Steven A.
Rosenblum and Peter E. Devine


Tel: (212)
403-1000


Fax: (212) 403-2000


and


Sidley Austin LLP


One South Dearborn
Street


Chicago, IL 60603


Attn: Thomas A.
Cole and Larry A. Barden


Tel: (312)
853-7473 and (312) 853-7785


Fax: (312) 853-7036


and


Skadden, Arps,
Slate, Meagher & Flom LLP


Suite 2100


333 West Wacker
Drive


Chicago, IL 60606


Attn: Charles W.
Mulaney, Jr.


Tel: (312)
407-0700


Fax: (312) 407-0411


and


McDermott, Will
& Emery


227 West Monroe
Street


Chicago, IL 60606


Attn: William W.
Merten


Tel: (312)
984-7647


Fax: (312) 984-7700


To
Tribune Acquisition:


EGI-TRB, L.L.C.


c/o Equity Group
Investments, L.L.C.


Two North Riverside Plaza, Suite 600



 53
 









Chicago, IL 60606


Attn: Joseph M.
Paolucci and Marc D. Hauser


Tel: (312)
466-3885 and (312) 466-3281


Fax: (312) 454-0335


with
copies to:


Jenner & Block
LLP


330 N. Wabash Ave.


Chicago, IL 60611


Attn: Joseph P.
Gromacki


Tel: (312)
923-2637


Fax: (312) 923-2737


or to such other
address as any party shall specify by written notice so given, and such notice
shall be deemed to have been delivered as of the date so telecommunicated,
personally delivered or mailed. Any party to this Agreement may notify any
other party of any changes to the address or any of the other details specified
in this paragraph; provided, however, that such notification
shall only be effective on the date specified in such notice or five (5)
business days after the notice is given, whichever is later. Rejection or other
refusal to accept or the inability to deliver because of changed address of which
no notice was given shall be deemed to be receipt of the notice as of the date
of such rejection, refusal or inability to deliver.


Section 8.8             Assignment;
Binding Effect. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto (whether
by operation of law or otherwise) without the prior written consent of the
other parties. Subject to the preceding sentence, this Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns.


Section 8.9             Severability.
Any term or provision of this Agreement which is invalid or unenforceable in
any jurisdiction shall, as to that jurisdiction, be ineffective to the extent
of such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this Agreement in any other
jurisdiction. If any provision of this Agreement is so broad as to be
unenforceable, such provision shall be interpreted to be only so broad as is
enforceable.


Section 8.10           Entire
Agreement; Third-Party Beneficiaries. This Agreement (including the
exhibits and schedules hereto) and the Confidentiality Agreement constitute the
entire agreement, and supersede all other prior agreements and understandings,
both written and oral, between the parties, or any of them, with respect to the
subject matter hereof and thereof and, except for the provisions of Section
2.1(a), Section 5.5(a), Section 5.5(b)(v), Section 5.9, and the last two
sentences of Section 5.5(b)(i), is not intended to and shall not confer
upon any person other than the parties hereto any rights or remedies hereunder.


Section 8.11           Amendments;
Waivers. At any time prior to the Effective Time, any provision of this
Agreement may be amended or waived if, and only if, such amendment or waiver is
in writing and signed, in the case of an amendment, by the Company, the ESOP
and



 54
 









Merger
Sub, or in the case of a waiver, by the party against whom the waiver is to be
effective; provided, however, that after receipt of Company
Shareholder Approval, if any such amendment or waiver shall by applicable Law
or in accordance with the rules and regulations of the New York Stock Exchange
require further approval of the shareholders of the Company, the effectiveness
of such amendment or waiver shall be subject to the approval of the
shareholders of the Company. Notwithstanding the foregoing, no failure or delay
by the Company or the ESOP in exercising any right hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise of any other right hereunder.


Section 8.12           Tribune
Acquisition Rights. Notwithstanding anything to the contrary contained
herein, it is expressly acknowledged and agreed that neither the ESOP nor
Merger Sub may, without the prior written consent of Tribune Acquisition,
either (a) waive or amend any provision of this Agreement (including, without
limitation, any condition under Section 6.1 or 6.3 hereof), including by the
exercise of any consent rights, or (b) agree to, or exercise any right to,
terminate this Agreement under Section 7.1(a) or 7.1(h).


Section 8.13           Headings.
Headings of the Articles and Sections of this Agreement are for convenience of
the parties only and shall be given no substantive or interpretive effect
whatsoever. The table of contents to this Agreement is for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.


Section 8.14           Interpretation.
When a reference is made in this Agreement to an Article or Section, such
reference shall be to an Article or Section of this Agreement unless otherwise
indicated. Whenever the words “include,” “includes” or “including” are used in
this Agreement, they shall be deemed to be followed by the words “without
limitation.”  The words “hereof,” “herein”
and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement. All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant
thereto unless otherwise defined therein. The definitions contained in this
Agreement are applicable to the singular as well as the plural forms of such
terms and to the masculine as well as to the feminine and neuter genders of
such term. Any agreement, instrument or statute defined or referred to herein
or in any agreement or instrument that is referred to herein means such
agreement, instrument or statute as from time to time amended, modified or
supplemented, including (in the case of agreements or instruments) by waiver or
consent and (in the case of statutes) by succession of comparable successor
statutes and references to all attachments thereto and instruments incorporated
therein. Each of the parties has participated in the drafting and negotiation
of this Agreement. If an ambiguity or question of intent or interpretation
arises, this Agreement must be construed as if it is drafted by all the
parties, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of authorship of any of the provisions of this
Agreement.


Section 8.15           No
Recourse. This Agreement may only be enforced against, and any claims or
causes of action that may be based upon, arise out of or relate to this
Agreement, or the negotiation, execution or performance of this Agreement may
only be made against, the entities that are expressly identified as parties
hereto and no past, present or future affiliate, director, officer, employee,
incorporator, member, manager, partner, stockholder, agent, attorney or
Representative of any party hereto shall have any liability for any obligations
or liabilities of



 55
 









the
parties to this Agreement or for any claim based on, in respect of, or by
reason of, the transactions contemplated hereby.


Section 8.16           Definitions.


(a)           References in this
Agreement to “Subsidiaries” of any party shall mean any corporation,
partnership, association, trust or other form of legal entity of which
(i) more than 50% of the outstanding voting securities are on the date
hereof directly or indirectly owned by such party, or (ii) such party or
any Subsidiary of such party is a general partner (excluding partnerships in
which such party or any Subsidiary of such party does not have a majority of
the voting interests in such partnership). References in this Agreement (except
as specifically otherwise defined) to “affiliates” shall mean, as to any
person, any other person which, directly or indirectly, controls, or is
controlled by, or is under common control with, such person. As used in this
definition, “control” (including, with its correlative meanings, “controlled
by” and “under common control with”) shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of management or
policies of a person, whether through the ownership of securities or
partnership or other ownership interests, by contract or otherwise. References
in this Agreement (except as specifically otherwise defined) to “person”
shall mean an individual, a corporation, a partnership, a limited liability
company, an association, a trust or any other entity, group (as such term is
used in Section 13 of the Exchange Act) or organization, including, without
limitation, a Governmental Entity, and any permitted successors and assigns of
such person. As used in this Agreement, “knowledge” means (i) with
respect to the ESOP, the actual knowledge of the individuals listed on Section
8.16(a) of the Company Disclosure Schedule and (ii) with respect to the
Company, the actual knowledge of the individuals listed on Section 8.16(a)
of the Company Disclosure Schedule. As used in this Agreement, “business day”
shall mean any day other than a Saturday, Sunday or a day on which the banks in
New York are authorized by law or executive order to be closed. References in
this Agreement to specific laws or to specific provisions of laws shall include
all rules and regulations promulgated thereunder. Any statute defined or
referred to herein or in any agreement or instrument referred to herein shall
mean such statute as from time to time amended, modified or supplemented,
including by succession of comparable successor statutes.


(b)           Each of the following terms is
defined on the pages set forth opposite such term:


	
  Action

  	
  43

  
	
  Additional Per
  Share Consideration

  	
  4

  
	
  affiliates

  	
  56

  
	
  Agreement

  	
  1

  
	
  Alternative
  Proposal

  	
  34

  
	
  Annualized
  Portion

  	
  4

  
	
  Book-Entry
  Shares

  	
  5

  
	
  business day

  	
  56

  
	
  Cancelled Shares

  	
  4

  
	
  Certificate of
  Designation

  	
  46

  



 



 56
 









 


	
  Certificate of
  Merger

  	
  2

  
	
  Certificates

  	
  5

  
	
  Change of
  Recommendation

  	
  33

  
	
  Closing

  	
  2

  
	
  Closing Date

  	
  2

  
	
  Code

  	
  6

  
	
  Communications
  Act

  	
  12

  
	
  Company

  	
  1

  
	
  Company
  Approvals

  	
  12

  
	
  Company Benefit
  Plans

  	
  17

  
	
  Company Common
  Stock

  	
  3

  
	
  Company
  Disclosure Schedule

  	
  7

  
	
  Company
  Employees

  	
  38

  
	
  Company FCC
  Licenses

  	
  15

  
	
  Company
  Financial Advisors

  	
  23

  
	
  Company Joint
  Venture

  	
  7

  
	
  Company Material
  Adverse Effect

  	
  8

  
	
  Company Material
  Contracts

  	
  23

  
	
  Company Meeting

  	
  36

  
	
  Company Permits

  	
  15

  
	
  Company Preferred
  Stock

  	
  9

  
	
  Company SEC
  Documents

  	
  13

  
	
  Company
  Shareholder Approval

  	
  22

  
	
  Company Station

  	
  16

  
	
  Company Stock
  Option

  	
  36

  
	
  Company Stock
  Plans

  	
  9

  
	
  Company
  Stock-Based Award

  	
  37

  
	
  Confidentiality
  Agreement

  	
  33

  
	
  control

  	
  56

  
	
  Debt Commitment
  Letters

  	
  44

  
	
  DGCL

  	
  2

  
	
  Dissenting
  Shares

  	
  4

  
	
  Divestiture

  	
  45

  
	
  Divestitures

  	
  45

  
	
  Eagle Entities

  	
  8

  
	
  Eagle New Media

  	
  8

  
	
  Eagle Publishing

  	
  8

  
	
  Effective Time

  	
  2

  
	
  Employees

  	
  21

  
	
  End Date

  	
  49

  
	
  Environmental
  Law

  	
  16

  
	
  ERISA

  	
  17

  
	
  ERISA Affiliate

  	
  18

  
	
  ESOP

  	
  1

  
	
  ESOP Approvals

  	
  25

  
	
  ESOP Fiduciary

  	
  1

  



 



 57
 









 


	
  ESOP Material
  Adverse Effect

  	
  24

  
	
  ESOP Purchase
  Agreement

  	
  1

  
	
  Exchange

  	
  46

  
	
  Exchange Act

  	
  11

  
	
  Exchange
  Agreement

  	
  9

  
	
  Exchange Fund

  	
  5

  
	
  Existing Credit
  Agreements

  	
  29

  
	
  FAA

  	
  15

  
	
  FCC

  	
  11

  
	
  FCC Applications

  	
  40

  
	
  FCC Order

  	
  12

  
	
  FCC Rules

  	
  12

  
	
  Financing

  	
  44

  
	
  Financing
  Commitments

  	
  44

  
	
  GAAP

  	
  13

  
	
  Governmental
  Entity

  	
  11

  
	
  Hazardous
  Substance

  	
  17

  
	
  HSR Act

  	
  11

  
	
  Indemnified
  Party

  	
  43

  
	
  Information
  Memorandum

  	
  27

  
	
  Intellectual
  Property

  	
  22

  
	
  Investor Rights
  Agreement

  	
  1

  
	
  IRS

  	
  18

  
	
  knowledge

  	
  56

  
	
  Law

  	
  14

  
	
  Laws

  	
  14

  
	
  Lien

  	
  12

  
	
  Maximum Premium

  	
  43

  
	
  Merger

  	
  1

  
	
  Merger
  Consideration

  	
  4

  
	
  Merger Sub

  	
  1

  
	
  MVPDs

  	
  24

  
	
  New Credit
  Agreements

  	
  29

  
	
  New Plans

  	
  38

  
	
  Notice of
  Superior Proposal

  	
  50

  
	
  Offer

  	
  46

  
	
  Offer Documents

  	
  46

  
	
  Offer Price

  	
  46

  
	
  Old Plans

  	
  38

  
	
  Option and
  Stock-Based Consideration

  	
  37

  
	
  Option
  Consideration

  	
  36

  
	
  Paying Agent

  	
  5

  
	
  Permitted Lien

  	
  13

  
	
  person

  	
  56

  
	
  Proxy Statement

  	
  19

  
	
  Recommendation

  	
  11

  



 



 58
 









 


	
  Regulatory Law

  	
  41

  
	
  Release

  	
  17

  
	
  Renewal
  Application

  	
  41

  
	
  Renewal Station

  	
  41

  
	
  Representatives

  	
  31

  
	
  Restricted
  Shares

  	
  37

  
	
  Rights

  	
  20

  
	
  Rights Agreement

  	
  20

  
	
  Sarbanes-Oxley
  Act

  	
  14

  
	
  Schedule 13E-3

  	
  19

  
	
  Schedule TO

  	
  46

  
	
  SEC

  	
  13

  
	
  Securities Act

  	
  13

  
	
  Series D-1
  Preferred Stock

  	
  9

  
	
  Series E
  Preferred Stock

  	
  46

  
	
  Share

  	
  3

  
	
  Special
  Committee

  	
  1

  
	
  State
  Commissions

  	
  11

  
	
  Stock Purchase
  Plan

  	
  37

  
	
  Subordinated
  Exchangeable Note

  	
  1

  
	
  Subordinated
  Note

  	
  1

  
	
  Subsidiaries

  	
  56

  
	
  Superior
  Proposal

  	
  34

  
	
  Surviving
  Corporation

  	
  2

  
	
  Tax Return

  	
  21

  
	
  Taxes

  	
  21

  
	
  Termination Date

  	
  27

  
	
  TO Schedule
  13E-3

  	
  46

  
	
  Tolling
  Agreement

  	
  42

  
	
  Transitional
  Compensation Plan

  	
  38

  
	
  Tribune
  Acquisition

  	
  1

  
	
  Tribune Purchase
  Agreement

  	
  1

  
	
  Warrant

  	
  1

  



 



 59















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


	
  

  	
  GREATBANC TRUST COMPANY, not in its

  individual or corporate capacity, but solely as

  trustee of the TRIBUNE EMPLOYEE STOCK

  OWNERSHIP TRUST, which forms a part of the

  TRIBUNE EMPLOYEE STOCK OWNERSHIP

  PLAN

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marilyn H. Marchetti

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marilyn H. Marchetti

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  TESOP CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marilyn H. Marchetti

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marilyn H. Marchetti

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  TRIBUNE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dennis J. FitzSimons

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Dennis J. FitzSimons

  
	
   

  	
   

  	
  Title:

  	
  Chairman, President and

  
	
   

  	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EGI-TRB, L.L.C.

  
	
   

  	
  (solely for the limited purposes of Section 8.12

  hereof)

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Philip G. Tinkler

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Philip G. Tinkler

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
						



 


 


Signature
Page to the Agreement and Plan of Merger