Document:

exv10w14

 

Exhibit 10.14

LEVI STRAUSS & CO.

EXECUTIVE SEVERANCE PLAN

(Effective May 1, 2004)

 

 

LEVI STRAUSS & CO.

EXECUTIVE SEVERANCE PLAN

     Introduction. Levi Strauss & Co. (the “Company”) established the Senior Executive
Severance Plan (the “Plan”) effective as of August 1, 2000. The Plan is hereby restated effective
May 1, 2004. Effective May 1, 2004, the Plan is named the “Executive Severance Plan”. The purpose
of the Plan is to recognize the past service of Executives whose employment is involuntarily
terminated as set forth herein by providing Severance Payments. The Plan is an unfunded deferred
compensation plan for a select group of management or highly compensated employees that is intended
to qualify for the exemptions provided in section 201, 301 and 401 of ERISA and for the alternative
reporting method provided in DOL Reg. §2520.104-23. This Plan supercedes all prior policies and
practices of the Company with respect to severance or separation pay for Executives whose
employment is involuntarily terminated after April 30, 2004. This Plan is the only severance
program for such Executives.

     1. Definitions.

          1.1. “Company” means Levi Strauss & Co.

          1.2. “Compensation” means an Executive’s regular base salary on his or her Termination
Date.

          1.3. “Comparable Position” means any job that has no impact on base salary. To be a
“Comparable Position” the different job must be performed at the same or geographically proximate
work site with the same or comparable work schedule, as determined in the sole discretion of the
Plan Administrator.

          1.4. “Employee” means a common-law employee of the Company on the Home Office Payroll,
including an employee classified by the Company as a U.S. expatriate employee, who is not subject
to the overtime provisions of the Fair Labor Standards Act, and who is paid through the Company’s
regular payroll system, and who has not signed an agreement that he or she is not entitled to
benefits from the Company.

          1.5. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

          1.6. “Executive” means an Employee whose position is classified under Executive Band
or Leader Band in the Company’s World-Wide Compensation Plan.

          1.7. “General Release Agreement” means a legally binding document in which an Employee
waives any and all claims against the Company related to his or her employment or separation from
employment. Whether or not an Employee chooses to sign the General Release Agreement is completely
at his or her discretion.

          1.8. “Plan” means the Levi Strauss & Co. Executive Severance Plan, as set forth in
this instrument and as hereafter amended.

 

 

          1.9. “Severance Payment(s)” or “Severance Pay” means the payments to an
eligible Executive pursuant to Section 3 on account of the termination of his or her employment
with the Company.

          1.10. “Termination Date” means the last day upon which an Executive is actively
employed with the Company.

          1.11. “Year of Service” means a twelve-month period of employment beginning on the
later of the Executive’s date of hire or most recent date of rehire. Years of Service are
calculated in full twelve month periods with no credit for partial years.

     2. Eligibility for Severance Payments.

          2.1. General Eligibility. Except as otherwise provided in the Plan, an Executive is
entitled to a Severance Payment under the Plan only if his or her employment with the Company is
involuntarily terminated by action of the Company after April 30, 2004, on account of a reduction
in force, layoff, position elimination, or because the Company has determined, in its sole
discretion, that his or her services are no longer required.

          2.2. Exclusions. An Executive is not eligible for a Severance Payment if he or she:

          (a) Voluntarily resigns before his or her last day of active employment as designated
by the Company, even if he or she received advance notice of his or her involuntary
termination;

          (b) Is terminated because of failure to return from an approved leave of absence;

          (c) Resigns or is involuntarily terminated because the Company has determined that he
or she violated any policy, procedure or rule of the Company, engaged in dishonest or
wrongful conduct, committed any crime or performed his or her duties in an unacceptable
manner;

          (d) Resigns or is terminated after declining to accept an offer of a Comparable
Position with the Company;

          (e) Has an individual written agreement with the Company that provides for any form of
severance, separation, or special retirement program.

          2.3. Certain Corporate Transactions. Unless, and only to the extent expressly
authorized by the Company or set forth in this Plan, no Severance Payment is payable under the Plan
to an Employee in the event of the sale or other disposition of the Company, any affiliate or any
assets or stock of either, if the Employee (i) continues to be employed by the Company, its
successor or an affiliate on or after the date of such sale or other disposition, (ii) is offered a
Comparable Position with the acquiring entity or any of

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its affiliates, or (iii) is offered a Comparable Position with an entity that was an affiliate
of the Company immediately prior to the sale or other disposition.

     3. Amount and Form of Severance Payments.

     3.1. Payment Amount. An eligible Executive shall be entitled to receive the
following Severance Payments:

          (a) Severance Pay: Subject to Section 3.2, except as otherwise provided in
this Plan, an eligible Executive will continue to receive his or her base salary for a
period of two (2) weeks beginning on the date he or she is notified that his or her
employment is terminated. If the Company requests, the eligible Executive will remain in
his or her position during this two (2) week period.

          (b) Enhanced Severance Pay: In exchange for providing the Company a valid
General Release Agreement in accordance with Section 3.5, in a form acceptable to the
Company, in addition to payments under Section 3.1(a), and subject to Section 3.2,
following the Termination Date, an eligible Executive will receive Enhanced Severance Pay
at the level of the Executive’s Compensation as of the Termination Date paid in
installments on the normal Company payroll schedule. The Enhanced Severance Pay has two
components as follows:

               (i) Base Pay. The eligible Executive is entitled to an amount of the Enhanced
Severance Pay determined under the following schedule:

	 	 	 
	Select Senior Executives in
Executive Band. See Appendix A

	 	104 weeks of Compensation
	 
	 	 
	Executive Band and whose annual
base salary Market Reference
Point (MRP) is $300,000.00 or
greater

	 	52 weeks of Compensation
	 
	 	 
	Executive Band and whose annual
base salary Market Reference
Point (MRP) is less than
$300,000.00

	 	26 weeks of Compensation, plus two
weeks of Compensation for each Year
of Service in excess of five (5)
years, to a maximum combined total of
52 weeks of Compensation.
	 
	 	 
	Leader Band

	 	26 weeks of Compensation, plus two
weeks of Compensation for each Year of
Service in excess of five (5) years,
to a maximum combined total of 52
weeks of Compensation.

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               (ii) AIP Pay. The eligible Executive shall also be entitled to receive his or her
target Annual Incentive Plan (“AIP”) payment for the fiscal year in which the termination
is announced to the Executive. The AIP component shall be issued through the Company’s
normal payroll process immediately following the Base payments under (i) above. Each
payroll installment will be at the level of his or her Compensation until he or she
receives the full AIP amount.

     3.2. Conditions and Limitations on Severance Payments.

          (a) All Enhanced Severance Pay under Section 3.1(b) is specifically conditioned upon
the Executive’s execution of a General Release Agreement at a time and in a manner to be
determined by the Company. Under no circumstances will any Enhanced Severance Pay be made
to an Executive who elects not to sign a General Release Agreement.

          (b) An Executive who receives consulting fees from the Company following his or her
Termination Date is not eligible for Severance Payments.

          (c) Severance Payments are in lieu of payments under any other severance plan, program
or arrangement of or with the Company.

          (d) An Executive is not eligible for Severance Payments if the Company determines that
he or she:

	 	(1)	 	has solicited any employee or consultant of the
Company to leave employment with the Company to accept
employment with any other person, company or partnership;
or
	 
	 	(2)	 	at any time discloses without the Company’s written
permission any confidential or proprietary information
that the Executive has learned as a result of his or her
employment with the Company and was not previously
available in the public domain.

To the extent permitted by law, if the Company determines that the Executive has engaged in
any of these activities, it will immediately cease any unpaid Severance Payments and it
will have the right to seek repayment of any such payments that have already been made.

     3.3. Form and Timing of Payment.

          (a) Severance Payments shall be made in such form as the Plan Administrator may
determine in its sole and absolute discretion.

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          (b) If an Executive dies before Severance Payments are completed, any remaining
Severance Payments will be made to the Executive’s estate.

          (c) Payment to an Executive of any unpaid Severance Payments will cease immediately
upon his or her re-employment by the Company.

          3.4. Plant Shut-Down or Mass Layoff. If the Executive is laid off or discharged
because of a plant shut-down or mass layoff to which the Worker Adjustment and Retraining Notice
Act of 1988 (“WARN”) applies, Severance Payments shall not be available, except as provided in this
subsection. The Company shall provide notice of termination of employment, or pay in lieu of
notice, or a combination of notice and pay in lieu of notice in accordance with the provisions of
WARN. The amount of Severance Payments to which the Executive is entitled under the Plan shall be
determined by subtracting the number of days’ pay in lieu of notice he or she receives pursuant to
WARN from the amount of Severance Payments to which he or she would be otherwise entitled under
this Section 3. If the pay in lieu of notice under WARN exceeds that Severance Payment amount the
Executive will be entitled to no Severance Payments under this Plan.

          3.5. General Release Agreement. The applicable General Release Agreement shall be
furnished to an eligible Executive along with a written explanation regarding that General Release
Agreement. It is completely within the eligible Executive’s own discretion as to whether he or she
elects to sign the applicable General Release Agreement. An eligible Executive is encouraged to
review the applicable General Release Agreement with his or her personal attorney at his or her own
expense, if he or she so desires.

     In order to receive Enhanced Severance Pay under Section 3.1(b), an eligible Executive must
sign, date and return the applicable General Release Agreement to the Company within forty-five
(45) days from the date he or she receives the applicable General Release Agreement or as of the
date such Executive separates from employment with the Company and is no longer on the Company
payroll, whichever is later. If an eligible Executive elects to sign the applicable General
Release Agreement, he or she then has seven (7) days from the date of such signing to revoke the
signed General Release Agreement. Any such revocation must be in writing and must be received by
the Company or its designee within the seven (7) day revocation period. If an eligible Executive
elects to revoke his or her signed General Release Agreement, such Executive shall not receive any
Enhanced Severance Pay.

     4. Other Benefits. An eligible Executive who receives a Severance Payment will also
receive the following benefits:

          (a) If an Executive and/or his or her covered dependents elect(s) to receive medical
coverage continuation through Consolidated Omnibus Budget Reconciliation Act of 1985
(“COBRA”), the Company will pay the same

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percentage of the monthly cost of his or her COBRA medical coverage as it paid for
Executive’s medical coverage during his or her active employment for the duration of the
Executive’s severance payment period under Section 3.1 above, up to a maximum coverage
period of 18 months.

During the Company-subsidized COBRA coverage period, Executive will be responsible for
payment of the remainder of the cost of his or her COBRA medical coverage and for the full
cost of any dental or vision coverage elected by the Executive. All periods of
Company-subsidized coverage are counted toward the 18-month COBRA entitlement. After the
Company-subsidized coverage period ends, the Executive will be responsible for payment of
his or her entire COBRA premium. Continuation of COBRA coverage will not extend beyond the
date on which a terminated Executive becomes eligible for coverage under another group
health plan unless the new plan has a pre-existing condition limitation or the Executive is
entitled to Medicare.

          (b) The Company will pay the cost of premiums under its standard basic life insurance
program of $10,000 for the same duration that it subsidizes the COBRA coverage in
subsection (a) above.

          (c) If an Executive retires and becomes covered by Company retiree health benefits,
the Company will subsidize retiree medical coverage for the same duration that it
subsidizes the COBRA coverage set forth in subsection (a) above.

          (d) The Company will provide Executive with career counseling and transition services
as selected by the Company.

          (e) If Executive has been employed by the Company at least one fiscal quarter in the
fiscal year of such Executive’s Termination Date, the Executive shall be entitled to a
payment under the AIP for that fiscal year based on the Executive’s actual performance
during such fiscal year, pro-rated to reflect the portion of the fiscal year actually
worked by the Executive

     5. Withholding. The Company will withhold from all Severance Payments all required
federal, state, local and other taxes and any other payroll deductions required.

     6. Administration. The Company has the sole and unlimited discretion to interpret the
terms of the Plan and to make all determinations about eligibility and payment of benefits. All
decisions of the Company, any action taken by the Company with respect to the Plan and within the
powers granted to the Company under the Plan, and any interpretation by the Company of any term or
condition of the Plan, are conclusive and binding on all persons, and will be given the maximum
possible deference allowed by law. The Company may delegate and reallocate any authority and
responsibility with respect to the Plan.

     7. Amendment or Termination. The Company reserves the right, in its sole and
unlimited discretion, to amend or terminate the Plan at any time by action of the

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Company’s Chief Executive Officer, or his or her designee, without prior notice to any
Executive.

     8. Claims Procedure. Any person who believes he or she is entitled to any payment
under the Plan may submit a claim in writing to the Company. Any such claim should be sent to the
Health & Welfare Plans Administrative Committee, c/o Levi Strauss & Co., P.O. Box 7215, San
Francisco, CA 94120, Attention: Greg Holmes. If the claim is denied (either in full or in part),
the claimant will be provided a written notice explaining the specific reasons for the denial and
referring to the provisions of the Plan on which the denial is based. The notice will describe any
additional information needed to support the claim. The denial notice will be provided within 90
days after the claim is received. If special circumstances require an extension of time (up to 90
days), written notice of the extension will be given within the initial 90-day period.

     9. Appeal Procedure. If a claimant’s claim is denied, the claimant may apply in
writing to the Company for a review of the decision denying the claim. The claimant then has the
right to review pertinent documents and to submit issues and comments in writing. The Company will
provide written notice of its decision on review within 60 days after it receives a review request.
If additional time (up to 60 days) is needed to review the request, the claimant will be given
written notice of the reason for the delay.

     10. Source of Payments. All Severance Payments will be paid in cash from the general
funds of the Company; no separate fund will be established under the Plan; and the Plan will have
no assets. Any right of any person to receive any payment under the Plan will be no greater than
the right of any other unsecured creditor of the Company.

     11. Inalienability. In no event may any Executive sell, transfer, anticipate, assign
or otherwise dispose of any right or interest under the Plan. At no time will any such right or
interest be subject to the claims of creditors nor liable to attachment, execution or other legal
process.

     12. Recovery of Payments Made by Mistake. An eligible Executive shall be required to
return to the Company any Severance Payment, or portion thereof, made by a mistake of fact or law.

     13. No Enlargement of Employment Rights. Neither the establishment or maintenance of
the Plan, the payment of any amount by the Company nor any action of the Company shall confer upon
any individual any right to be continued as an Employee nor any right or interest in the Plan other
than as provided in the Plan. Other than an Employee who has a written agreement to the contrary
signed by the President, Chief Executive Officer or a Senior Vice President of the Company, every
Employee is an employee-at-will whose employment with the Company may be terminated by the Company
or the Employee at any time with or without cause and with no notice.

     14. Applicable Law. The provisions of the Plan will be construed, administered and
enforced in accordance with ERISA and, to the extent applicable, the laws of the State of
California.

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     15. Severability. If any provision of the Plan is held invalid or unenforceable, its
invalidity or unenforceability will not affect any other provision of the Plan, and the Plan will
be construed and enforced as if such provision had not been included.

     16. Execution.

     IN WITNESS WHEREOF, Levi Strauss & Co., by its duly authorized officer, has executed the Plan
on the date indicated below.

	 	 	 	 	 	 	 
	 	 	LEVI STRAUSS & CO.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Dated:	 	 	 	 
	 

	 	 	 	 	 	 

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LEVI STRAUSS & CO.

EXECUTIVE SEVERANCE PLAN

GENERAL RELEASE AGREEMENT

To receive Enhanced Severance Pay under the Levi Strauss & Co. Executive Plan (the “Plan”), you
must agree to and sign this General Release Agreement.

You and Levi Strauss & Co. (“LS&CO.”) hereby agree as follows:

	1.	 	If you sign this General Release Agreement, you will receive the Enhanced Severance Pay under
the Plan for which you are eligible, as set forth in the terms of the Plan.
	 
	2.	 	In consideration for the Enhanced Severance Pay under the Plan, you, on your own behalf and
on behalf of your heirs, executors, administrators, attorneys and assigns, hereby
unconditionally and irrevocably release, waive and forever discharge LS&CO. and its
predecessors, successors, assigns, subsidiaries, related entities, officers, directors, voting
trustees, shareholders, employees, agents, attorneys and insurers (collectively referred to as
the “Company”) from all causes of action, claims and damages, including attorneys’ fees,
whether known or unknown, foreseen or unforeseen, presently asserted or otherwise, which have
or could have arisen to date out of or related to your employment, or from your termination of
employment and/or your retirement.
	 
	 	 	The released claims include, but are not limited to, any claims or entitlement to salary,
bonuses, incentives or other payments, benefits or damages arising under any federal law
(including but not limited to, Title VII of the Civil Rights Act of 1964, as amended by the
Civil Rights Act of 1991, the Age Discrimination in Employment Act, the Americans with
Disabilities Act, Executive Order 11246, and the Family and Medical Leave Act); any claim
arising under state or local ordinances or regulations (including but not limited to, the
California Fair Employment & Housing Act or the California Labor Code); and any claim
arising under any common law principle or public policy, including all suits in tort or
contract.
	 
	 	 	You also waive, release and promise never to assert any rights and benefits afforded by
Section 1542 of the California Civil Code and any similar law of any state or territory of
the United States and do so understanding and acknowledging the significance and
consequences of such specific waiver of said provisions of law. Section 1542 of the
California Civil Code states as follows:

“A General Release does not extend to claims which the Creditor
does not know or suspect to exist in his favor at the time of
executing the General Release, which, if known to him must have
materially affected his settlement with the Debtor.”

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	 	 	You represent that you have not assigned or otherwise transferred any interest in any claim
that is the subject of this General Release Agreement.
	 
	 	 	By signing this General Release Agreement, you understand that you are not waiving any
other claims or rights which cannot be waived by law, including the right to file an
administrative charge or participating in an investigation conducted by the Equal
Employment Opportunities Commission (“EEOC”) and any claims which you may make under state
workers’ compensation or unemployment laws (excluding any claims of discrimination or
retaliation on the basis of workers’ compensation status), and/or any claims which by law
you cannot waive.
	 
	3.	 	In the event that you breach any of your obligations under this General Release Agreement or
attempt to rescind this General Release Agreement, LS&CO. will be entitled to recover the full
amount of the Enhanced Severance Pay under the Plan, to obtain all other relief provided by
law or equity, and to recover court costs and reasonable attorneys’ fees, including expert
witness fees, incurred in any such proceeding.
	 
	4.	 	You have forty-five (45) days to consider whether to accept this General Release Agreement,
although you may accept it at any time within those forty-five (45) days.
	 
	 	 	You are advised to consult an attorney before signing the General Release Agreement. To
accept the General Release Agreement, you must sign it on or after your separation date,
but before the forty-five (45) day period has expired, and return it to LS&CO.
	 
	 	 	You may revoke your acceptance of the General Release Agreement within seven (7) days from
the date you accepted it. To revoke, you must send a written statement of revocation by
registered mail, return receipt requested, to Greg Holmes, Vice President of Compensation,
1155 Battery Street, San Francisco, CA 94111.
	 
	 	 	If you sign this General Release Agreement and do not revoke your acceptance, you will
receive the severance benefits under the Plan, as set forth in the terms of the Plan.
	 
	5.	 	You acknowledge that the severance benefits under the Plan are in addition to anything to
which you are otherwise entitled.
	 
	6.	 	You acknowledge that you have been informed in writing of the following information:

	 	a.	 	the eligibility requirements for the Plan;
	 
	 	b.	 	the job titles and ages of all employees who are eligible for the Plan; and

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	 	c.	 	the ages of all employees who are not eligible for the Plan.

	7.	 	You acknowledge and agree that no representations have been made to you outside this General
Release Agreement to induce you to enter into this General Release Agreement.
	 
	8.	 	The provisions of this General Release Agreement are contractual and severable. If any part
of this General Release Agreement is at any time held invalid, that part will remain in effect
to the extent allowed by law and all other provisions shall remain in full force and effect.
	 
	9.	 	This General Release Agreement, together with the Older Workers Benefit Protective Act
Disclosures, constitute a single, integrated written contract expressing the entire agreement
between you and LS&CO. There is no other agreement, written or oral, express or implied,
between you and LS&CO. with respect to the subject matter of this General Release Agreement.
This General Release Agreement may be modified only in writing signed by you and LS&CO.
	 
	10.	 	You acknowledge that you have been given the opportunity to consult with counsel of your own
choosing and that you have carefully considered the terms of the General Release Agreement,
understand its terms, and have voluntarily signed this General Release Agreement.
	 
	11.	 	This General Release Agreement is governed by and construed in accordance with the laws of
the State of California.

	 	 	 	 	 	 	 	 	 
	Date:

	 	 	 	Employee Name:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	     (Please print clearly)	 	 

Employee Signature:                                         

Please return to:

[Insert name and address]

11exv10w1

 

Execution Version

TAX MATTERS AGREEMENT

By and Between

BELO CORP.

and

A. H. BELO CORPORATION

Dated as of February 8, 2008

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	ARTICLE I
	 	DEFINITIONS	 	1
	 
	 	 	 	 
	Section 1.01
	 	Definition of Terms	 	1
	 
	 	 	 	 
	ARTICLE II
	 	PAYMENT OF TAXES	 	6
	 
	 	 	 	 
	Section 2.01
	 	Income Taxes	 	6
	Section 2.02
	 	Spin-Off Taxes	 	7
	Section 2.03
	 	Other Taxes	 	7
	Section 2.04
	 	Other Income Taxes	 	8
	Section 2.05
	 	Allocation of Certain Income Taxes and Income Tax Items	 	9
	Section 2.06
	 	Refunds	 	10
	Section 2.07
	 	Carrybacks	 	10
	 
	 	 	 	 
	ARTICLE III
	 	PREPARATION AND FILING OF TAX RETURNS	 	11
	 
	 	 	 	 
	Section 3.01
	 	Belo Responsibility	 	11
	Section 3.02
	 	A. H. Belo Responsibility	 	12
	Section 3.03
	 	Tax Accounting Practices	 	12
	Section 3.04
	 	Right to Review Tax Returns	 	13
	 
	 	 	 	 
	ARTICLE IV
	 	TAX-FREE STATUS OF DISTRIBUTION	 	13
	 
	 	 	 	 
	Section 4.01
	 	Covenants	 	13
	Section 4.02
	 	Procedures Regarding Opinions and Rulings	 	15
	 
	 	 	 	 
	ARTICLE V
	 	TAX CONTESTS; INDEMNIFICATION; COOPERATION	 	16
	 
	 	 	 	 
	Section 5.01
	 	Notice	 	16
	Section 5.02
	 	Control of Tax Contests	 	16
	Section 5.03
	 	Indemnification Payments	 	17
	Section 5.04
	 	Interest on Late Payments	 	18
	Section 5.05
	 	Treatment of Payments	 	18
	Section 5.06
	 	Expenses	 	18
	Section 5.07
	 	Cooperation	 	18
	Section 5.08
	 	Confidentiality	 	19
	Section 5.09
	 	Retention of Tax Records	 	19
	 
	 	 	 	 
	ARTICLE VI
	 	RESOLUTION OF DISPUTES	 	20
	 
	 	 	 	 
	Section 6.01
	 	Tax Disputes	 	20

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	ARTICLE VII
	 	MISCELLANEOUS PROVISIONS	 	20
	 
	 	 	 	 
	Section 7.01
	 	Disposition of A. H. Belo Subsidiaries	 	20
	Section 7.02
	 	Complete Agreement; Representations	 	20
	Section 7.03
	 	Costs and Expenses	 	21
	Section 7.04
	 	Governing Law	 	21
	Section 7.05
	 	Notices	 	21
	Section 7.06
	 	Amendment, Modification or Waiver	 	22
	Section 7.07
	 	No Assignment; Binding Effect	 	22
	Section 7.08
	 	Counterparts	 	23
	Section 7.09
	 	Specific Performance	 	23
	Section 7.10
	 	Texas Forum	 	23
	Section 7.11
	 	WAIVER OF JURY TRIAL	 	23
	Section 7.12
	 	Interpretation; Conflict With Ancillary Agreements	 	24
	Section 7.13
	 	Severability	 	24
	Section 7.14
	 	Survival	 	24

ii

 

TAX MATTERS AGREEMENT

          This TAX MATTERS AGREEMENT (this “Agreement”), dated as of February 8, 2008, by and
between Belo Corp., a Delaware corporation (“Belo”), and A. H. Belo Corporation, a Delaware
corporation whose sole shareholder is Belo (“A. H. Belo” and, together with Belo, each, a
“Party” and collectively, the “Parties”).

          WHEREAS, as of the date of this Agreement, the Belo affiliated group includes A. H. Belo and
its subsidiaries;

          WHEREAS, the Parties (or their predecessors-in-interest) have entered into the Separation and
Distribution Agreement (as defined herein), pursuant to which Belo has contributed to A. H. Belo
the stock and assets associated with the A. H. Belo Business (as defined herein) in exchange for
shares of common stock of A. H. Belo (the “Contribution”);

          WHEREAS, Belo intends to distribute on a pro rata basis to its shareholders all of the shares
of stock of A. H. Belo (the “Distribution”);

          WHEREAS, in order to effect the Contribution and Distribution the Parties have engaged in
various internal transfers of assets and stock (the “Related Reorganizations”);

          WHEREAS, the Parties intend that the Contribution, Distribution and Related Reorganizations
qualify for non-recognition of gain or loss pursuant to one or more of Sections 368(a), 351, 354,
355, 361 or 1032 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”);

          WHEREAS, as a result of and upon the Distribution, A. H. Belo and its subsidiaries will cease
to be members of the Belo Group; and

          WHEREAS, the Parties desire to allocate the Tax responsibilities, liabilities and benefits of
transactions that occur on or prior to, and that may occur after, the date on which the
Distribution occurs (the “Distribution Date”) and to provide for and address certain other
Tax matters.

          NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the
Parties (each on behalf of itself and each of its Affiliates) hereby agree as follows:

ARTICLE I

DEFINITIONS

          Section 1.01 Definition of Terms. The following terms shall have the following meanings (such
meanings to apply equally to both the singular and the plural forms of the terms defined). All
Section and Exhibit references are to this Agreement unless otherwise stated. Capitalized terms
used in this Agreement but not defined herein shall have the meanings ascribed to such terms in the
Separation and Distribution Agreement.

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          “Action” means any claim, demand, action, cause of action, suit, countersuit,
arbitration, litigation, inquiry, proceeding or investigation by or before any Governmental
Authority or any arbitration or mediation tribunal or authority.

          “Active Trade or Business” means the active trade or business of A. H. Belo and its
subsidiaries as described in the Ruling.

          “Adjustment Request” means any formal or informal claim or request filed with any
governmental authority for any Refund, underpayment or overpayment of Tax or any change in
available Tax Attributes.

          “Affiliate” of any Person means any other Person that, after the Distribution, is
directly or indirectly “controlled” by any of (i) the Person in question, (ii) any Person of which
the Person in question is an Affiliate under clause (i), or (iii) any Affiliate under clause (i) of
a Person described in clause (ii). For purposes of this definition, “control” means the
possession, directly or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through ownership of voting securities or other interests, by
contract or otherwise.

          “Agreement” has the meaning set forth in the recitals.

          “A. H. Belo” has the meaning set forth in the recitals.

          “A. H. Belo Business” means the newspaper business and related businesses as more
fully described in the Information Statement provided in connection with the Distribution.

          “A. H. Belo Capital Stock” means (i) all classes or series of capital stock of A. H.
Belo, including common stock and all other instruments treated as equity in A. H. Belo for U.S.
federal Income Tax purposes and (ii) all options, warrants and other rights to acquire such capital
stock.

          “A. H. Belo Group” means A. H. Belo and each of its Subsidiaries and Affiliates as of
the date hereof, and any corporation or other entity that may become part of such Group from time
to time. For the avoidance of doubt, the A. H. Belo Group excludes any entity that is a member of
the Belo Group.

          “Ancillary Agreement” has the meaning set forth in the Separation and Distribution
Agreement.

          “Belo” has the meaning set forth in the recitals.

          “Belo Consolidated Group” means the affiliated group of corporations (within the
meaning of Section 1504 of the Code) of which Belo is the common parent on or prior to the
Distribution Date.

          “Belo Group” means Belo and each of its Affiliates and Subsidiaries as of the date
hereof, and any corporation or other entity that may become part of such Group from time to

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time.
For the avoidance of doubt, the Belo Group excludes any entity that is a member of the A. H. Belo
Group.

          “Code” has the meaning set forth in the recitals.

          “Contribution” has the meaning set forth in the recitals.

          “Distribution” has the meaning set forth in the recitals.

          “Distribution Date” has the meaning set forth in the recitals.

          “Final Determination” means the final resolution of liability for any Tax for any
taxable period by or as a result of (i) a final and unappealable decision, judgment, decree or
other order by any court of competent jurisdiction; (ii) a final settlement with the IRS, a closing
agreement or accepted offer in compromise under Code Sections 7121 or 7122, or a comparable
arrangement under the laws of another jurisdiction; (iii) any allowance of a Refund in respect of
an overpayment of Tax, but only after the expiration of all periods during which such amount may be
recovered by the Taxing Authority imposing the Tax; or (iv) any other final disposition, including
by reason of the expiration of the applicable statute of limitations.

          “Governmental Authority” means any federal, state, local, foreign or international
court, government, department, commission, board, bureau or agency, or any other regulatory,
self-regulatory, administrative or governmental organization or authority, including the New York
Stock Exchange, Inc.

          “Group” means the Belo Group and/or the A. H. Belo Group, as the context requires.

          “Income Taxes” means all federal, state, local, and foreign income or franchise Taxes
or other Taxes based on income or net worth.

          “Indemnifying Party” has the meaning set forth in Section 5.01.

          “Indemnitee” has the meaning set forth in Section 5.01.

          “IRS” means the U.S. Internal Revenue Service.

          “Joint Return” means any Return that includes both a member of the Belo Group and a
member of the A. H. Belo Group.

          “Law” means any applicable foreign, federal, national, state, provincial or local law
(including common law), statute, ordinance, rule, regulation, code or other requirement enacted,
promulgated, issued or entered into, or act taken, by a Governmental Authority.

          “Other Taxes” means all Taxes other than Income Taxes, including (but not limited to)
transfer, sales, use, excise, payroll, property, and unemployment Taxes.

          “Party” or “Parties” has the meaning set forth in the recitals.

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          “Past Practices” has the meaning set forth in Section 3.03(a).

          “Person” means any natural person, corporation, general or limited partnership,
limited liability company or partnership, joint stock company, joint venture, association, trust,
bank, trust company, land trust, business trust or other organization, whether or not a legal
entity, and any Governmental Authority.

          “Post-Distribution Tax Period” means any taxable period (or portion thereof) beginning
after 11:59 p.m., Central Time, on the Distribution Date.

          “Pre-Distribution Tax Period” means any taxable period (or portion thereof) ending on
or before 11:59 p.m., Central Time, on the Distribution Date.

          “Prime Rate” means the “prime rate” published in the “Money Rates” section of The Wall
Street Journal. If The Wall Street Journal ceases to publish the “prime rate,” then the Parties
shall mutually agree to an equivalent publication that publishes such “prime rate,” and if such
“prime rate” is no longer generally published or is limited, regulated or administered by a
Governmental Authority, then a comparable interest rate index mutually agreed to by the Parties.

          “Proposed Acquisition Transaction” has the meaning set forth in Section 4.02(b)(i).

          “Refund” means any cash refund of Taxes or reduction of Taxes by means of credit,
deduction, offset or otherwise.

          “Related Reorganizations” has the meaning set forth in the recitals.

          “Reportable Transaction” means a reportable or listed transaction as defined in
Section 6011 of the Code or the Treasury Regulations promulgated thereunder.

          “Restricted Period” means the period beginning on the date of this Agreement and
ending on, and including, the last day of the two-year period following the Distribution Date.

          “Ruling” means all private letter rulings granted by the IRS or any other taxing
authority relating to the Transactions (whether granted prior to, on or after the date hereof),
requests for such rulings, including all supplemental ruling requests and information submissions,
and any exhibit to any of the foregoing.

          “Satisfactory Guidance” means either a ruling from the IRS or an Unqualified Tax
Opinion, at the election of A. H. Belo, in either case reasonably satisfactory to Belo in both form
and substance, including with respect to any underlying assumptions or representations.
Satisfactory Guidance shall not include an Unqualified Tax Opinion with respect to which Belo’s
counsel, of recognized national standing, provides an opinion to Belo that the conclusions in such
Unqualified Tax Opinion are not free from doubt. For the avoidance of doubt, this definition is
intended to allow Belo to prevent A. H. Belo from taking the action that is the subject of a ruling
from the IRS or an Unqualified Tax Opinion, if Belo determines in good faith
that there is any Tax risk to it from such action based upon either (1) any uncertainty
concerning

4

 

any underlying assumptions or representations in such ruling or opinion or (2) any legal
uncertainty referred to in advice it receives from its counsel.

          “Separate Return” means (i) in the case of the A. H. Belo Group, a Tax Return of any
member of that Group (including any consolidated, combined, affiliated or unitary Return) that does
not include, for all or any portion of the relevant taxable period, any member of the Belo Group
and (ii) in the case of the Belo Group, a Tax Return of any member of that Group (including any
consolidated, combined, affiliated or unitary Return) that does not include, for all or any portion
of the relevant taxable period, any member of the A. H. Belo Group.

          “Separation and Distribution Agreement” means the Separation and Distribution
Agreement, as amended from time to time, by and between Belo and A. H. Belo dated as of February 8,
2008.

          “Spin-Off Taxes” means all (i) Taxes of any member of the Belo Group or the A. H. Belo
Group resulting from, or arising in connection with, the failure of the Related Reorganizations,
Contribution or the Distribution to have Tax-Free Status, (ii) Taxes of the type described in
clause (i) of any third party for which any member of the Belo Group or the A. H. Belo Group is or
becomes liable, and (iii) reasonable out of pocket legal, accounting and other advisory and court
fees in connection with liability for Taxes described in clauses (i) or (ii).

          “Straddle Period” means any taxable period beginning on or before the Distribution
Date and ending after the Distribution Date.

          “Tax Advisor” means a U.S. Tax counsel or other Tax advisor of recognized national
standing reasonably acceptable to both Parties.

          “Tax Attribute” means a net operating loss, net capital loss, investment credit,
foreign Tax credit, excess charitable contribution, general business credit or any other item of
loss, deduction or credit that could reduce a Tax liability.

          “Tax Contest” means an audit, review, examination or any other administrative or
judicial proceeding with the purpose or effect of determining or redetermining Taxes (including any
administrative or judicial review of any Adjustment Request).

          “Tax Dispute” means any dispute arising in connection with this Agreement.

          “Tax-Free Status” means the qualification of the Related Reorganizations, Contribution
and Distribution (i) as one or more transactions qualifying for non-recognition of gain pursuant to
Code Sections 355(a) and 368(a)(1)(D) or 351, (ii) in which the A. H. Belo stock (and other stock
distributed in the Related Reorganizations) is “qualified property” for purposes of Code Sections
355(c) and 361(c), (iii) in which Belo, A. H. Belo and the shareholders of Belo recognize no income
or gain for U.S. federal Income Tax purposes pursuant to Code Sections 354, 355, 361 and 1032 and
(iv) that qualifies for tax-free treatment under comparable provisions of state and local law. For
the avoidance of doubt, recognition of income or gain that relates to items described in Sections
2.03(c)(i)(A) or 2.04 or to intercompany items shall not cause the Distribution to fail to achieve
Tax-Free Status.

5

 

          “Tax Item” means any item of income, gain, loss, deduction, credit, recapture of
credit, or any other item (including the basis or adjusted basis of property) which increases or
decreases Income Taxes paid or payable in any taxable period.

          “Tax Opinions/Rulings” means (i) any Ruling and (ii) the opinions of Tax Advisors
relating to the Transactions including, without limitation, those issued either at the time of the
Distribution or to allow a Party to take actions otherwise prohibited under this Agreement.

          “Tax Return” or “Return” means any return, filing, report, questionnaire,
information statement, claim for Refund, or other document required or permitted to be filed,
including any amendments that may be filed, for any taxable period with any Taxing Authority.

          “Taxes” means all forms of taxation or duties imposed, or required to be collected or
withheld, including charges, together with any related interest, penalties or other additional
amounts. For the avoidance of doubt, the term “Taxes” does not include amounts to be paid to any
Governmental Authority pursuant to escheat law.

          “Taxing Authority” means any Governmental Authority imposing Taxes.

          “Transactions” means the Contribution, the Distribution, the Related Reorganizations,
the transactions contemplated by the Separation and Distribution Agreement and any other transfer
of assets (whether by contribution, sale or otherwise) between any member of the Belo Group and any
member of the A. H. Belo Group in connection with the Contribution or the Distribution.

          “Unqualified Tax Opinion” means an unqualified “will” opinion of a Tax Advisor that
permits reliance by Belo. The Tax Advisor, in issuing its opinion, shall be permitted to rely on
the validity and correctness, as of the date given, of any previously issued Tax Opinions/Rulings,
unless such reliance would be unreasonable under the circumstances.

ARTICLE II

PAYMENT OF TAXES

          Section 2.01 Income Taxes.

          (a) Except as otherwise provided hereinafter in this Section 2.01 and in Sections 2.02 and
2.04, Belo shall be responsible for all Income Taxes (i) of A. H. Belo and its Affiliates for any
Pre-Distribution Tax Period; (ii) of A. H. Belo and its Affiliates for any Straddle Period, but
only to the extent allocated to Belo pursuant to Section 2.05; or (iii) imposed under Treasury
Regulation Section 1.1502-6 or under any comparable or similar provision of state, local or foreign
laws or regulations on A. H. Belo or an Affiliate solely as a result of such company being a member
of a consolidated, combined, or unitary group with Belo or any Belo Affiliate during any Tax
period. Provided, however that (x) any liability for Taxes (and related expenses) resulting from a
redetermination on audit examination (or other proceeding) of any gain recognized as a result of
the Distribution pursuant to Treasury Regulation § 1.1502-13 (or any predecessor provision), or
comparable provision of state law, shall be shared one-third by Belo and two-thirds by A. H. Belo
and (y) pursuant to the historic tax sharing policy of the Belo Consolidated Group, A. H. Belo
shall bear and shall reimburse Belo therefor as provided in

6

 

Section 3.02(b) (xx) the A. H. Belo Group’s share of the Income Tax liability for the period
from January 1, 2008 through the Distribution Date reported on the consolidated federal income tax
return (and any similar state return) of Belo and its subsidiaries and (yy) the entire amount
reported on each 2008 Separate Return of the A. H. Belo Group or any member thereof.

          (b) A. H. Belo shall be responsible for all Income Taxes (i) of A. H. Belo and its Affiliates
which are not the responsibility of Belo pursuant to Section 2.01(a) (including, without
limitation, Income Taxes for Post-Distribution Tax Periods of A. H. Belo and its Affiliates); and
(ii) of Belo and its Affiliates attributable to acts or omissions of A. H. Belo or its Affiliates
taken after the Distribution (other than acts or omissions that are (x) in the ordinary course of
business, (y) otherwise contemplated by the Separation and Distribution Agreement or any Ancillary
Agreement or (z) specifically addressed in Section 2.02, below, which shall govern liability for
Spin-Off Taxes).

          Section 2.02 Spin-Off Taxes.

          (a) A. H. Belo shall be liable, and shall indemnify the Belo Group, for any Spin-Off Taxes
that are attributable to (i) any inaccurate statement or representation of fact or intent (or
omission to state a material fact) in a letter or certificate that is provided by any member of the
A. H. Belo Group after the date hereof, and that forms the basis for the Tax Opinions/Rulings; (ii)
any act or omission by the A. H. Belo Group after the date of this Agreement inconsistent with the
covenants set forth in this Agreement; or (iii) any other act or omission by the A. H. Belo Group
after the date of this Agreement (except for acts disclosed in any Ruling request submitted to the
IRS prior to the date hereof), including any act or omission that would have resulted in A. H. Belo
being in breach of Section 4.01(b) but for the receipt by A. H. Belo of a Ruling from the IRS, an
Unqualified Tax Opinion or a waiver.

          (b) Belo shall be liable, and shall indemnify the A. H. Belo Group, for any Spin-Off Taxes
attributable to (i) any inaccurate statement or representation of fact or intent (or omission to
state a material fact) in a letter or certificate that is provided by any member of the Belo Group
after the date hereof and that forms the basis for the Tax Opinions/Rulings; (ii) any act or
omission by the Belo Group after the date of this Agreement inconsistent with the covenants set
forth in this Agreement; or (iii) any other act or omission (except for acts disclosed in any
Ruling request submitted to the IRS prior to the date hereof) by the Belo Group after the date of
this Agreement.

          (c) Liability for any Spin-Off Taxes described in both paragraphs (a) and (b) shall be shared
by Belo and A. H. Belo according to relative fault. If neither Party is at fault, they shall share
the liability equally.

          Section 2.03 Other Taxes.

          (a) Subject to Section 2.03(c), below, Belo shall be responsible for all Other Taxes
attributable to Belo and its Affiliates (other than A. H. Belo and its Affiliates) and to its
business activities other than the A. H. Belo Business, or resulting from the Transactions, for all
Pre-Distribution Tax Periods, Straddle Periods, and Post-Distribution Tax Periods.

7

 

          (b) Subject to Section 2.03(c), below, A. H. Belo shall be responsible for all Other Taxes
attributable to A. H. Belo and its Affiliates or to the A. H. Belo Business for all
Pre-Distribution Tax Periods, Straddle Periods, and Post-Distribution Tax Periods.

          (c) In each case the responsibilities of 2.03(a) and 2.03(b) shall be consistent with the
principles described below:

               (i) Transfer Taxes.

                    (A) Except as otherwise provided in this Agreement or the other Ancillary Agreements, the
Belo Group shall be liable, and shall indemnify the A. H. Belo Group, for any stamp, sales, use,
gross receipts, value-added, real estate transfer or other transfer Taxes imposed in connection
with the Transactions.

                    (B) If business operations or assets of a Belo entity are transferred to an A. H. Belo entity
as part of the Transactions, the transferee shall assume any and all liabilities for stamp, sales,
use, gross receipts, value-added, real estate transfer and other transfer Taxes associated with
such transferred operations (but not such liabilities specifically relating to the Transactions)
and will have sole responsibility for satisfying such liabilities.

                    (C) With respect to Refund claims pending on the Distribution Date involving any sales, use,
gross receipts or other similar Taxes, (x) in the case of a Refund received by Belo and payable to
A. H. Belo pursuant to the terms hereof, the amount of such payment shall be net of all contingent
fee expenses and Taxes paid by Belo and related to such Refund, or (y) in the event that A. H. Belo
receives a Refund due any member of the A. H. Belo Group directly from the relevant Taxing
Authority, it shall reimburse Belo for all contingent fee expenses and Taxes paid by Belo with
respect to such Refund. For the avoidance of doubt, A. H. Belo shall not be liable for any
contingent fee expenses or Taxes related to Refunds received prior to the Distribution Date.

               (ii) Property Taxes. If property is transferred between legal entities, the
transferee shall assume any and all liabilities for real and personal property Taxes associated
with such transferred property and will have sole responsibility for satisfying such liabilities.

               (iii) Payroll Taxes. If an employee moves from one employer to another, the “new”
employer shall assume any and all employment related Taxes attributable to such transferred
employee and will have sole responsibility for satisfying such liabilities.

          Section 2.04 Certain Income Taxes. Without regard to anything to the contrary in this Article
II, Belo shall be liable, and shall indemnify the A. H. Belo Group, for all Taxes arising as a
result of the Transactions from (i) excess loss accounts taken into account under Code Section
1502, (ii) Code Section 357(c) or (iii) Code Section 361(b), in each case, including under similar
state and local law provisions. Any Taxes attributable to deferred intercompany gains that are
triggered as a result of the Transactions shall be the responsibility of Belo and shall not be
included in determining the A. H. Belo Group’s Income Tax liability. To the extent there are
adjustments to the amount of any deferred intercompany gain triggered as a result of the
Distribution, Belo and A. H. Belo shall, pursuant to Section 2.01(a), be responsible for paying
the additional Tax associated with any increase in the amount of gain in the ratio of one-third and

8

 

two-thirds, respectively, and Belo shall be entitled to any Refund attributable to any
reduction of gain except to the extent the Refund is attributable to an increase in the amount of
such gain, in which case the Refund or portion thereof shall be shared between Belo and A. H. Belo
in accordance with the above ratio.

          Section 2.05 Allocation of Certain Income Taxes and Income Tax Items.

          (a) If Belo, A. H. Belo or any of their respective Affiliates is permitted but not required
under applicable U.S. federal, state, local or foreign Tax laws to treat the Distribution Date as
the last day of a taxable period, then the Parties shall treat such day as the last day of a
taxable period under such applicable Tax law, and shall file any elections necessary or appropriate
to such treatment; provided that this Section 2.05(a) shall not be construed to require Belo to
change its taxable year.

          (b) Transactions occurring, or actions taken, on the Distribution Date but after the
Distribution outside the ordinary course of business by, or with respect to, A. H. Belo or any of
its Affiliates shall be deemed subject to the “next day rule” of Treasury Regulation Section
1.1502-76(b)(1)(ii)(B) (and under any comparable or similar provision under state, local or foreign
laws or regulations, provided that if there is no comparable or similar provision under state,
local or foreign laws or regulations, then the transaction will be deemed subject to the “next day
rule” of Treasury Regulation Section 1.1502-76(b)(1)(ii)(B)) and as such shall for purposes of this
Agreement be treated (and consistently reported by the Parties) as occurring in a Post-Distribution
Tax Period of A. H. Belo or an A. H. Belo Affiliate, as appropriate.

          (c) Any Taxes for a Straddle Period with respect to A. H. Belo and/or its Affiliates (or
entities in which A. H. Belo and/or one of its Affiliates has an ownership interest) shall, for
purposes of this Agreement, be apportioned between Belo and A. H. Belo based on the portion of the
period ending on and including the Distribution Date and the portion of the period beginning after
the Distribution Date, and each such portion of such period shall be deemed to be a taxable period
(whether or not it is in fact a taxable period). Any allocation of income or deductions required
to determine any Income Taxes for a Straddle Period shall be made by means of a closing of the
books and records of A. H. Belo and its Affiliates as of the close of business on the Distribution
Date; provided that (i) Belo may elect to allocate Tax Items (other than any extraordinary Tax
Items) ratably in the month in which the Distribution occurs (and if Belo so elects, A. H. Belo
shall so elect) as described in Treasury Regulation Section 1.1502-76(b)(2)(iii) and corresponding
provisions of state, local, and foreign Tax laws; and (ii) subject to (i), exemptions, allowances
or deductions that are calculated on an annual basis, and not on a closing of the books method,
(including, but not limited to, depreciation and amortization deductions) shall be allocated
between the period ending on and including the Distribution Date and the period beginning after the
Distribution Date based on the number of days for the portion of the Straddle Period ending on and
including the Distribution Date, on the one hand, and the number of days for the portion of the
Straddle Period beginning after the Distribution Date, on the other hand.

          (d) Tax Attributes determined on a consolidated or combined basis for taxable periods ending
before or including the Distribution Date shall be allocated to Belo and its Affiliates, and A. H.
Belo and its Affiliates, in accordance with the Code and the Treasury

9

 

Regulations (and any applicable state, local, or foreign law or regulation). Belo shall
reasonably determine the amounts and proper allocation of such attributes, and the Tax basis of the
assets and liabilities transferred to A. H. Belo in connection with the Transactions, as of the
Distribution Date; provided that A. H. Belo shall be entitled to participate in such determination.
Belo and A. H. Belo agree to compute their Tax liabilities for taxable periods after the
Distribution Date consistent with that determination and allocation, and treat the Tax Attributes
and Tax Items as reflected on any federal (or applicable state, local or foreign) Income Tax Return
filed by the Parties as presumptively correct.

          Section 2.06 Refunds. Except as provided in Section 2.07:

          (a) Belo shall be entitled to all Refunds with respect to any Tax for which Belo is
responsible under Sections 2.01, 2.02, 2.03, or 2.04. A. H. Belo shall be entitled to all Refunds
with respect to any Tax for which A. H. Belo is responsible under Sections 2.01, 2.02, 2.03, or
2.04. Belo shall be entitled to any Refund resulting from change of accounting method granted by
the IRS for 2007 or 2008.

          (b) A. H. Belo and Belo shall each forward to the other Party, or reimburse such other Party
for, any Refunds received by the first Party and due to such other Party pursuant to this Section
(net of all contingent fees and Taxes payable by the first Party and related to such Refund).
Where a Refund is received in the form of a deduction from, or credit or other offset against other
or future Tax liabilities, reimbursement with respect to such Refund shall be due in each case on
the due date for payment of the Tax from or against which such Refund has been deducted, credited
or otherwise offset.

          (c) If one Party reasonably so requests, the other Party (at the first Party’s expense) shall
file for and pursue any Refund to which the first Party is entitled under this Section; provided
that the other Party need not pursue any Refund on behalf of the first Party unless the first Party
provides the other Party a certification by an appropriate officer of the first Party setting forth
the first Party’s belief (together with supporting analysis) that the Tax treatment of the Tax
Items on which the entitlement to such Refund is based is more likely than not correct, and is not
a Tax Item arising from a Reportable Transaction.

          (d) If the other Party pays any amount to the first Party under this Section 2.06 and, as a
result of a subsequent Final Determination, the first Party is not entitled to some or all of such
amount, the other Party shall notify the first Party of the amount to be repaid to the other Party,
and the first Party shall then repay such amount to the other Party, together with any interest,
fines, additions to Tax, penalties or any additional amounts imposed by a Taxing Authority relating
thereto.

          Section 2.07 Carrybacks.

          (a) Notwithstanding anything in this Agreement, A. H. Belo shall file (or cause to be filed)
on a timely basis any available election to waive the carryback of net operating losses, Tax
credits or other Tax Items by A. H. Belo or any Affiliate from a Post-Distribution Tax Period to a
Straddle Period or Pre-Distribution Tax Period. Such elections shall include, but not be limited
to, the election described in Treasury Regulation Section 1.1502-21(b)(3)(ii)(B),

10

 

and any analogous election under state, local, or foreign Income Tax laws, to waive the
carryback of net operating losses for U.S. federal Income Tax purposes.

          (b) If, notwithstanding the provisions of Section 2.07(a), A. H. Belo is required to carryback
losses or credits, A. H. Belo shall be entitled to any Refund of any Tax obtained by Belo or a Belo
Affiliate as a result of the carryback of losses or credits of A. H. Belo or its Affiliate from any
Post-Distribution Tax Period to any Pre-Distribution Tax Period. Such Refund is limited to the net
amount received by Belo or a Belo Affiliate, net of any Tax cost incurred by Belo or such Affiliate
resulting from such Refund. Upon request by A. H. Belo, Belo shall advise A. H. Belo of an
estimate of any Tax cost Belo projects will be associated with any carryback of losses or credits
of A. H. Belo or its Affiliates as provided in this Section 2.07(b).

          (c) If A. H. Belo has a Tax Item that must be carried back to any Pre-Distribution Tax Period,
A. H. Belo shall notify Belo in writing that such Tax Item must be carried back. Such notification
shall include a description in reasonable detail of the grounds for the Refund and the amount
thereof, and a certification by an appropriate officer of A. H. Belo setting forth A. H. Belo’s
belief (together with supporting analysis) that the Tax treatment of such Tax Item is more likely
than not correct, and is not a Tax Item arising from a Reportable Transaction.

          (d) If Belo pays any amount to A. H. Belo under Section 2.07(b) and, as a result of a
subsequent Final Determination, A. H. Belo is not entitled to some or all of such amount, Belo
shall notify A. H. Belo of the amount to be repaid to Belo, and A. H. Belo shall then repay such
amount to Belo, together with any interest, fines, additions to Tax, penalties or any additional
amounts imposed by a Taxing Authority relating thereto.

ARTICLE III

PREPARATION AND FILING OF TAX RETURNS

          Section 3.01 Belo Responsibility.

          (a) Subject to paragraph (b) below, Belo shall make all determinations with respect to, have
ultimate control over the preparation of and file all (i) Joint Returns and Belo Separate Returns,
in each case as it determines to be mandatory or advisable for all taxable periods, (ii) A. H. Belo
Separate Returns that are Income Tax Returns for all Pre-Distribution Tax Periods and (iii) at
Belo’s election, A. H. Belo Separate Returns that are Income Tax Returns for all Straddle Periods
provided that Belo provides written notice to A. H. Belo 45 days after the end of such Straddle
Period that Belo is exercising its right to prepare such Tax Return.

          (b) If, in connection with the preparation of any Return, Belo materially modifies any
information relating to, or provided in, the pro forma federal and state Income Tax Returns or
other information related to members of the A. H. Belo Group prepared by A. H. Belo and provided to
Belo pursuant to Section 3.02 below, the portions of the Returns that include such information
shall be submitted to A. H. Belo no later than 30 days prior to the due date (including extensions)
for filing of such federal Returns and 20 days prior to the due date (including extensions) for
filing of such state Returns (or if such due date is within 30 days

11

 

following the Distribution Date, as promptly as practicable following the Distribution Date).
Within 10 days after delivery of any such revised portions of any Return, A. H. Belo shall provide
comments to Belo in writing to the extent A. H. Belo objects to any revisions that could reasonably
be expected to adversely impact any member of the A. H. Belo Group. Such A. H. Belo comments shall
be incorporated into the Return upon the consent of Belo, not to be unreasonably withheld. If A.
H. Belo does not so notify Belo of any objection, A. H. Belo shall be considered to have consented
to the filing of such Return. The dates for submissions to A. H. Belo required in this section may
be modified by mutual agreement of Belo and A. H. Belo.

          Section 3.02 A. H. Belo Responsibility.

          (a) A. H. Belo shall make all determinations with respect to, have ultimate control over the
preparation of and file all Tax Returns (other than those described in Section 3.01) for the A. H.
Belo Group as it determines to be mandatory or advisable and for all taxable periods. A. H. Belo
shall prepare and provide to Belo all pro forma federal and state Income Tax Returns and other
information related to members of the A. H. Belo Group required to complete any Tax Return which is
the responsibility of Belo pursuant to Section 3.01, in the format reasonably requested by Belo,
and at least 110 days prior to the due date (including extensions) of the relevant federal Return
and at least 100 days prior to the due date (including extensions) of the relevant state Return.
The dates for submissions to Belo required in this section may be modified by mutual agreement of
Belo and A. H. Belo.

          (b) In the case of any Tax Return that is the responsibility of Belo pursuant to Section
3.01(a) and that relates to an Income Tax that is the obligation of A. H. Belo, A. H. Belo shall
pay to Belo the amount of the provision for such Income Tax no later than 10 days prior to the due
date (including extensions) for the filing of such Tax Return.

          Section 3.03 Tax Accounting Practices.

          (a) Except as provided in Section 3.03(b), any Tax Return for any Pre-Distribution Tax Period
or Straddle Period, to the extent it relates to members of the A. H. Belo Group, shall be prepared
in accordance with practices, accounting methods, elections, conventions and Tax positions used
with respect to the Tax Return in question for periods prior to the Distribution (“Past
Practices”), and, in the case of any item the treatment of which is not addressed by Past
Practices, in accordance with generally acceptable Tax accounting practices. Notwithstanding the
foregoing, for any Tax Return described in the preceding sentence, (i) a Party will not be required
to follow Past Practices with either the written consent of the other Party (not to be unreasonably
withheld) or a “should” level opinion from a Tax Advisor that the proposed method of reporting is
correct and (ii) Belo shall have the right to determine which entities will be included in any
consolidated, combined, affiliated or unitary Return that it is responsible for filing.

          (b) The Parties shall report the Transactions for all Tax purposes in a manner consistent with
the Tax Opinions/Rulings, unless, and only to the extent, an alternative position is required
pursuant to a Final Determination. Belo shall determine the Tax treatment to be reported on any
Tax Return of any Tax issue relating to the Transactions that is not covered by the Tax
Opinions/Rulings.

12

 

          Section 3.04 Right to Review Tax Returns. Upon request, each Party shall make available to
the other Party the portion of Pre-Distribution Tax Period Tax Returns that relates to the A. H.
Belo Group that the first Party is responsible for preparing under this Article III.

ARTICLE IV

TAX-FREE STATUS OF DISTRIBUTION

          Section 4.01 Covenants.

          (a) Each of A. H. Belo and Belo will not take or fail to take, or permit its Affiliates to
take or fail to take, any action (which includes the undertaking of any transaction) where that
action or omission would (i) violate, be inconsistent with or cause to be untrue any covenant,
representation or statement in any Tax Opinions/Rulings or a letter or certificate that forms the
basis therefor, or (ii) prevent, or be reasonably likely to prevent, or be inconsistent with, the
Tax-Free Status.

          (b) During the Restricted Period, except as provided in paragraph (c), A. H. Belo shall not,
and shall not permit its Affiliates to, in a single transaction or in a series of transactions:

               (i) permit any transaction or series of transactions (or any agreement, understanding or
arrangement to enter into a transaction or series of transactions) as determined for purposes of
Code Section 355(e), in connection with which (A) any member of the A. H. Belo Group would merge or
consolidate with any Person other than any other member of the A. H. Belo Group, (B) any member of
the A. H. Belo Group would form one or more joint ventures with any Person other than any other
member of the A. H. Belo Group in which, in the aggregate, more than 10% of the gross assets of the
A. H. Belo Group are transferred to such joint ventures or (C) any Person would (directly or
indirectly) acquire, or have the right to acquire, from any other Person or Persons, a more than
10% interest in A. H. Belo Capital Stock (a “Proposed Acquisition Transaction”). For these
purposes, any recapitalization, repurchase or redemption of A. H. Belo Capital Stock shall be
treated as an indirect acquisition of such stock by any non-exchanging shareholder to the extent
such shareholder’s percentage interest in the issuer increases by vote or value. Notwithstanding
the foregoing, a Proposed Acquisition Transaction shall not include (w) the adoption by A. H. Belo
of a shareholder rights plan that meets the requirements of IRS Revenue Ruling 90-11, (x) issuances
of A. H. Belo Capital Stock pursuant to an employee stock purchase agreement or equity compensation
plan that Belo has notified A. H. Belo in writing is acceptable to Belo in its sole discretion (for
the avoidance of doubt, (i) any modification or amendment to such agreement or plan is also subject
to the prior written consent of Belo and (ii) Belo’s approval is required for the underlying
purchase agreement or plan but not for each issuance of stock pursuant thereto), (y) transfers on
an established market of A. H. Belo Capital Stock described in Safe Harbor VII of Treasury
Regulation Section 1.355-7(d) or (z) issuances of A. H. Belo Capital Stock described in Safe Harbor
IX (relating to acquisitions by a retirement plan of an employer) of Treasury Regulation Section
1.355-7(d);

13

 

               (ii) liquidate or partially liquidate, including by way of merger or consolidation, any
member of the A. H. Belo Group other than A. H. Belo;

               (iii) liquidate or partially liquidate A. H. Belo;

               (iv) cause or permit the A. H. Belo Group to cease to engage in the Active Trade or Business;

               (v) sell or transfer assets, other than inventory sold or transferred in the ordinary course
of business, constituting (A) 50% or more of the gross assets that are held by any member of the A.
H. Belo Group and are used in the Active Trade or Business and are relied upon to satisfy the
requirements of Code Section 355(b), (B) 50% or more of the consolidated gross assets of the A. H.
Belo Group that are used in an Active Trade or Business (such percentages to be measured based on
fair market value as of the Distribution Date) or (C) any lesser amount if that sale or transfer
could reasonably be expected to result in a significant and material change to, or termination of,
the Active Trade or Business immediately after the Distribution Date; or

               (vi) amend its certificate of incorporation (or other organizational documents), or take any
other action, affecting the relative voting rights of the separate classes of A. H. Belo Capital
Stock; provided, however, that this clause (vi) shall not be deemed to be violated upon A. H.
Belo’s adoption of a shareholder rights plan that meets the requirements of IRS Revenue Ruling
90-11.

          (c) Notwithstanding paragraph (b):

               (i) clauses (i) through (vi) of paragraph (b) shall not apply upon the prior written consent
of Belo, which consent may not be withheld if Belo determines in good faith that A. H. Belo has
provided it with Satisfactory Guidance concluding that the proposed actions will not result in
Spin-Off Taxes;

               (ii) clause (v) of paragraph (b) shall not apply after the six month anniversary of the
Distribution Date;

               (iii) for purposes of clause (i), if A. H. Belo provides Belo an Unqualified Tax Opinion that
is intended to be Satisfactory Guidance concerning a Proposed Acquisition Transaction, then such
Opinion may be based on the assumption that Belo did not have any agreement, understanding,
arrangement or substantial negotiations, within the meaning of Treasury Regulations Section
1.355-7(h), with the counterparty to the Proposed Acquisition Transaction within the two year
period preceding the Distribution Date and such assumption shall not prevent such Unqualified Tax
Opinion from being considered Satisfactory Guidance by the Parties, provided that (x) such
assumption must be based on a certificate of such counterparty that such assumption is true to the
best of its knowledge and belief, and (y) Belo may deem such Opinion not to be Satisfactory
Guidance if, in its reasonable judgment, there is a risk that such assumption is not correct; and

               (iv) In the event that A. H. Belo intends to consummate any Proposed Acquisition Transaction
after the end of the Restricted Period but before the end of 30 months

14

 

after the Distribution Date, then either (x) A. H. Belo shall be permitted to consummate such
proposed Acquisition Transaction, provided that A. H. Belo shall provide Belo with an
unconditional certification that it did not have any agreement, understanding, arrangement or
substantial negotiations, within the meaning of Treasury Regulations Section 1.355-7(h), with the
counterparty to such transaction within 12 months after the Distribution Date, and Belo after
reasonable due investigation is satisfied with the correctness of such certification, or (y) such
Proposed Acquisition Transaction shall be subject to the provisions under Sections 4.01(b) and (c).

          (d) Notwithstanding anything herein to the contrary, for purposes of paragraph (c), no Ruling
shall be obtained from the IRS if Belo determines that there is a reasonable possibility that such
an action could have a significant adverse impact on any member of the Belo Group.

          (e) Nothing contained in this Section 4.01 or elsewhere in this Agreement shall prohibit A. H.
Belo or any of its subsidiaries from entering into loan agreements, other credit arrangements,
related security agreements, related stock pledge agreements, or other borrowing or collateral
agreements or arrangements, including without limitation that certain Credit Agreement dated on or
about February 4 2008, among A. H. Belo, as Borrower, the Lenders party thereto, and JP Morgan
Chase Bank, N. A., as Administrative Agent (the “Credit Agreement”), any of the other Loan
Documents (as defined in the Credit Agreement) or any amendment, modification, restatement or
refinancing thereof or from performing any of their respective obligations thereunder, incurring
any indebtedness thereunder or granting any security interests or liens in any property or assets
of A. H. Belo or any of its subsidiaries or in any equity interests in any of A. H. Belo’s
subsidiaries to secure such indebtedness.  Nothing in this Section 4.01 or elsewhere in this
Agreement shall prohibit the exercise of any rights or remedies of the Administrative Agent or the
Lenders under or pursuant to the Credit Agreement, any other Loan Documents or any amendment,
modification, restatement or refinancing thereof.

          Section 4.02 Procedures Regarding Opinions and Rulings.

          (a) Subject to Section 4.01(d), if A. H. Belo may take certain actions conditioned upon the
receipt of Satisfactory Guidance, Belo, at the request of A. H. Belo, shall use commercially
reasonable efforts to expeditiously obtain, or assist A. H. Belo in obtaining, such Satisfactory
Guidance. Belo shall not be required to take any action pursuant to this Section 4.02(a) if A. H.
Belo fails to certify, upon request, that all information and representations relating to any
member of the A. H. Belo Group in the relevant documents are true, correct and complete. A. H.
Belo shall reimburse Belo for all reasonable out-of-pocket costs and expenses incurred by the Belo
Group in obtaining Satisfactory Guidance.

          (b) Belo shall have the right to obtain a Ruling from the IRS (or any other Taxing Authority)
or an Unqualified Tax Opinion at any time in its sole discretion. Belo shall reimburse A. H. Belo
for all reasonable out-of-pocket costs and expenses incurred by the A. H. Belo Group in obtaining
such a Ruling or Unqualified Tax Opinion.

          (c) Belo shall have exclusive control over the process of obtaining any Ruling relating to the
Transactions and neither A. H. Belo nor any of its Affiliates shall independently

15

 

seek any guidance concerning the Transactions from any Taxing Authority at any time. In
connection with any Ruling relating to the Transactions that can reasonably be expected to affect
A. H. Belo liabilities under this Agreement, Belo shall (i) keep A. H. Belo informed of all
material actions taken or proposed to be taken by Belo, (ii) reasonably in advance of the
submission of any Ruling request provide A. H. Belo with a draft thereof, consider A. H. Belo’s
comments on such draft, and provide A. H. Belo with a final copy, and (iii) provide A. H. Belo with
notice reasonably in advance of, and permit A. H. Belo to attend, any formally scheduled meetings
with the IRS (subject to the approval of the IRS) that relate to such Ruling.

ARTICLE V

TAX CONTESTS; INDEMNIFICATION; COOPERATION

          Section 5.01 Notice.

          (a) Within 15 days after a Party (the “Indemnitee”) becomes aware of the existence of
a Tax Contest that may give rise to an indemnification claim under this Agreement by it against the
other Party (the “Indemnifying Party”), the Indemnitee shall promptly notify the
Indemnifying Party of the Tax Contest, and thereafter shall promptly forward or make available to
the Indemnifying Party copies of notices and communications with a Taxing Authority relating to
such Tax Contest.

          (b) The Indemnifying Party shall not be responsible for any increase in amounts to which the
Indemnitee is otherwise entitled to the extent that such increase results solely from the failure
of the Indemnitee to provide timely notice as required pursuant to Section 5.01(a).

          Section 5.02 Control of Tax Contests.

          (a) Except as otherwise provided in paragraphs (b) and (c):

               (i) Belo shall control, and have sole discretion in handling, settling or contesting, any Tax
Contest relating to any Joint Returns, as well as any Separate Returns or other Return if any such
Return is related to Taxes for which Belo is responsible pursuant to Article II, or the Tax
treatment of the Transactions, provided that (x) Belo shall act in good faith in connection
with its control of any such Tax Contests and (y) A. H. Belo shall have the right to participate in
and advise on (including, without limitation, the opportunity to review and comment upon Belo’s
communications with the Taxing Authority, which comments shall be incorporated upon the consent of
Belo, not to be unreasonably withheld) such items for which A. H. Belo could be liable under
Article II as a result of such Tax Contest; and

               (ii) If A. H. Belo disagrees with Belo’s decision to settle a Tax Contest that may reasonably
be expected materially to affect amounts for which A. H. Belo is liable under Article II, A. H.
Belo shall have the right to contest its liability to Belo under Article II notwithstanding the
settlement. A. H. Belo shall provide written notice to Belo of its intention to contest its
liability as a result of any settlement (and its irrevocable election described below) prior to the
time such settlement is entered into. Any such contest by A. H. Belo shall be made under the
procedures set forth in Article VI. Under those procedures, A. H. Belo may irrevocably elect, in
its sole discretion, to require the Tax Advisor or the arbitrator to determine

16

 

either (x) the amount of a settlement with the relevant Taxing Authority that would most
accurately reflect the litigation risk of the relevant issue, or (y) the most likely outcome of the
issue if it were litigated without a settlement. In either such case, A. H. Belo shall be liable
to Belo, or Belo shall be liable to A. H. Belo, based solely on the determination of the Tax
Advisor or the arbitrator as if a settlement or litigation implementing such determination had
actually occurred, without regard to the actual settlement. For the avoidance of doubt, this
clause (ii) shall not limit Belo’s ability to settle a Tax Contest.

          (b) A. H. Belo shall control and have sole discretion in handling, settling or contesting, any
Tax Contest for a Pre-Distribution Tax Period to the extent such Tax Contest relates solely to
Taxes that are the responsibility of A. H. Belo pursuant to Article II; provided that Belo shall
have the right to participate in and advise on all aspects of such Tax Contests and may coordinate
discussions with the relevant Taxing Authority with respect thereto.

          (c) Belo and A. H. Belo shall jointly control Tax Contests relating to Tax liability arising
from the failure of the Transactions to qualify for tax-free treatment under Code Sections 355 or
361, if there is a reasonable likelihood that A. H. Belo would be liable to Belo under Article II
as a result of such Tax Contest. Neither Party shall have the right to settle any such Tax Contest
without the consent of the other Party; provided that Belo may settle any such Tax Contest without
the consent of A. H. Belo if Belo waives any claim for indemnification with respect thereto.

          (d) Except as otherwise provided in paragraph (a), (b) or (c), A. H. Belo shall have sole
control over any Tax Contest that relates to A. H. Belo Separate Returns for any Post-Distribution
Tax Period.

          (e) Any out-of-pocket costs incurred in handling, settling or contesting a Tax Contest shall
be borne ratably by the Parties based on their ultimate liability under this Agreement for the
Taxes to which the Tax Contest relates; provided, however, that if A. H. Belo contests a settlement
made by Belo as provided in clause (ii) of paragraph (a), A. H. Belo shall bear the costs relating
to A. H. Belo’s contest of such settlement unless A. H. Belo substantially prevails in such
contest.

          Section 5.03 Indemnification Payments.

          (a) An Indemnitee shall be entitled to make a claim for payment pursuant to this Agreement
when the Indemnitee determines that it is entitled to such payment and the amount of such payment
(including, for the avoidance of doubt, the finalization of a Return before filing). The
Indemnitee shall provide to the Indemnifying Party notice of such claim within 10 days of the date
on which it first so becomes entitled to claim such payment, including a description of such claim
and a detailed calculation of the amount of the indemnification payment that is claimed, provided,
however, that no delay on the part of the Indemnitee in notifying the Indemnitor shall relieve the
Indemnitor from any obligation hereunder unless (and then solely to the extent) the Indemnitor is
actually and materially prejudiced thereby. Except as provided in paragraph (b), the Indemnifying
Party shall make the claimed payment to the Indemnitee within 10 days after receiving such notice,
unless the Indemnifying Party reasonably disputes its liability for, or the amount of, such
payment.

17

 

          (b) If the Indemnitee will be obligated to make the payment described in paragraph (a) to a
Taxing Authority or other third Party (including expenses reimbursable under this Agreement), the
Indemnifying Party shall not be obligated to pay the Indemnitee more than 5 days before the
Indemnitee incurs such expense or makes such payment. If the Indemnitee’s claim for payment arises
from a payment that the Indemnifying Party will receive from a third Party, such as a Refund, the
Indemnifying Party shall not be obligated to pay the Indemnitee until 5 days after the Indemnifying
Party receives such payment.

          (c) In the case of a claim under Article II where no payment will be made to or received from
a Taxing Authority, paragraph (b) shall be applied to the payments that would be made to or from a
Taxing Authority if the A. H. Belo Group was treated as a standalone group for all taxable periods.

          Section 5.04 Interest on Late Payments. Interest shall accrue with respect to any
indemnification payment (including any disputed payment that is ultimately required to be made),
not made within the period for payment, at Prime Rate plus 2% per annum compounded quarterly.

          Section 5.05 Treatment of Payments.

          (a) The amount of all indemnification obligations under this Agreement shall be decreased to
take into account the Tax benefits to the Indemnitee of the deductibility of any indemnified item
(whether or not any Tax benefit is actually received for a deductible item and assuming the highest
applicable taxable rate) and shall be increased where necessary so that, after all the required
deductions (whether or not any Tax benefit is actually received for a deductible item and assuming
the highest applicable taxable rate) have been made and Taxes imposed, the Indemnitee receives the
amount it would have been entitled to receive under this Agreement in the absence of such
deductions and Taxes.

          (b) Any payments made to one Party by another Party pursuant to (i) this Agreement or (ii) the
Separation and Distribution Agreement (if payment made pursuant to the Separation and Distribution
Agreement relates to taxable periods (or portions thereof) ending on or before the Distribution)
shall be treated by the Parties for all Tax purposes as a distribution by, or capital contribution
to, A. H. Belo, as the case may be, made immediately prior to the Distribution, except to the
extent otherwise required by a Final Determination.

          Section 5.06 Expenses. Except as otherwise provided herein, each Party and its Affiliates
shall bear their own expenses incurred in connection with preparation of Tax Returns, Tax Contests,
and other matters under this Agreement.

          Section 5.07 Cooperation. Each member of the Belo Group and the A. H. Belo Group shall
cooperate fully with all reasonable requests from the other Party in connection with the
preparation and filing of Tax Returns and Adjustment Requests, Tax Contests and other matters
covered by this Agreement.

          (a) Such cooperation shall include:

18

 

               (i) the retention until the expiration of the applicable statute of limitations, and the
provision upon request, of Tax Returns, books, records (including information regarding ownership
and Tax basis of property), documentation and other information relating to the Tax Returns,
including accompanying schedules, related workpapers, and documents relating to Rulings or other
determinations by Taxing Authorities;

               (ii) the execution of any document that may be necessary or reasonably helpful in connection
with any Tax Contest, the filing of a Tax Return or Adjustment Request by a member of the Belo
Group or the A. H. Belo Group, obtaining a Tax opinion or private letter ruling (except as
otherwise provided in Section 4.02(c)), or other matters covered by this Agreement, including
certification (provided in such form as may be required by applicable law or reasonably requested
and made to the best of a Party’s knowledge) of the accuracy and completeness of the information it
has supplied;

               (iii) the use of the Parties’ reasonable best efforts to obtain any documentation that may be
necessary or reasonably helpful in connection with any of the foregoing;

               (iv) the use of the Parties’ reasonable best efforts to make the applicable Party’s current
or former directors, officers, employees, agents and facilities available on a reasonable and
mutually convenient basis in connection with the foregoing matters; and

               (v) making determinations with respect to actions described in Section 4.01(c) as promptly as
practicable including, without limitation, making determinations within 10 days with respect to
modifications and amendments of employee stock purchase agreements or equity compensation plans
under Section 4.01(b)(i)(x).

          (b) If a Party fails to comply with any of its obligations set forth in this Section 5.07 upon
reasonable request and notice by the other Party, and such failure results in the imposition of
additional Taxes, the nonperforming Party shall be liable in full for such additional Taxes.

          Section 5.08 Confidentiality. Any information or documents provided under this Agreement
shall be kept confidential by the recipient-Party, except as may otherwise be necessary in
connection with the filing of Tax Returns or with any Tax Contest. In addition, if Belo or A. H.
Belo determines that providing such information could be commercially detrimental, violate any law
or agreement or waive any privilege, the Parties shall use reasonable best efforts to permit
compliance with the obligations under this Agreement in a manner that avoids any such harm or
consequence.

          Section 5.09 Retention of Tax Records. A. H. Belo may request from Belo and retain copies of
(i) with respect to any Joint Return, all pro forma federal and state Tax Returns, supporting
schedules and workpapers related to members of the A. H. Belo Group, and (ii) any Separate Returns
for any A. H. Belo Group members, including supporting schedules and workpapers. If either Belo or
A. H. Belo intends to dispose of documentation with respect to any Pre-Distribution Tax Period,
including books, records, Tax Returns and all supporting schedules and information relating thereto
(after the expiration of the applicable statute of limitations), of

19

 

any member of the other Group, or in the case of the A. H. Belo Group any member included in a
Joint Return, they shall provide written notice to the other Party describing the documentation to
be disposed of 30 days prior to taking such action. The other Party may arrange to take delivery
of the documentation described in the notice at its own expense during the succeeding 30 day
period.

ARTICLE VI

RESOLUTION OF DISPUTES

          Section 6.01 Tax Disputes. The Parties will endeavor, and will cause their respective
Affiliates to endeavor, to resolve in an amicable manner all disputes arising in connection with
this Agreement. The Parties shall negotiate in good faith to resolve any Tax Dispute for not less
than 45 days. Upon written notice of either Party after 45 days, the matter will be referred to a
Tax Advisor acceptable to both Parties. The Tax Advisor may, in its discretion, obtain the
services of any third-party necessary to assist it in resolving the dispute. The Tax Advisor shall
furnish written notice to the Parties of its resolution of the dispute as soon as practicable, but
in any event no later than 45 days after its acceptance of the matter for resolution. Any such
resolution by the Tax Advisor will be binding on the Parties and the Parties shall take, or cause
to be taken, any action necessary to implement the resolution. All fees and expenses of the Tax
Advisor shall be shared equally by Belo, on the one hand, and A. H. Belo, on the other hand. If,
having determined that the dispute must be referred to a Tax Advisor, after 45 days the Parties are
unable to find a Tax Advisor willing to adjudicate the dispute in question and whom the Parties in
good faith find acceptable, then the dispute will be submitted for arbitration to the American
Arbitrators Association, provided, however, that only an arbitrator that qualifies as a Tax Advisor
shall be selected.

ARTICLE VII

MISCELLANEOUS PROVISIONS

          Section 7.01 Disposition of A. H. Belo Subsidiaries. In the event that A. H. Belo disposes of
the stock of a subsidiary that is not a Party to this Agreement (i) without receiving compensation
equal to the fair market value of such subsidiary, prior to the disposition, such subsidiary shall
deliver to Belo an executed agreement, in a form reasonably acceptable to Belo, agreeing to be
bound by this Agreement as if it had been an original Party hereto or (ii) in an exchange intended
to result in the receipt of compensation equal to the fair market value of such subsidiary, prior
to the disposition, such subsidiary shall deliver to Belo an executed agreement, in a form
reasonably acceptable to Belo, agreeing to be bound by Sections 5.07, 5.08, 5.09 and Article VII of
this Agreement as if it had been an original Party hereto.

          Section 7.02 Complete Agreement; Representations.

          (a) Except as explicitly stated herein, this Agreement, together with the exhibits and
schedules hereto constitutes the entire agreement between the Parties with respect to the subject
matter hereof and shall supersede all previous negotiations, commitments and writings with respect
to such subject matter.

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          (b) Belo represents on behalf of itself and each other member of the Belo Group and A. H. Belo
represents on behalf of itself and each other member of the A. H. Belo Group as follows:

               (i) each such Person has the requisite corporate or other power and authority and has taken
all corporate or other action necessary in order to execute, deliver and perform this Agreement and
to consummate the transactions contemplated by this Agreement; and

               (ii) this Agreement has been duly executed and delivered by such Person (if such Person is a
Party) and constitutes a valid and binding agreement of it enforceable in accordance with the terms
thereof (assuming the due execution and delivery thereof by the other Party), except as such
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium and other Laws relating to creditors’ rights generally and by general equitable
principles.

          Section 7.03 Costs and Expenses. All costs and expenses incurred in connection with the
negotiation, preparation, execution and performance of this Agreement and the transactions
contemplated hereby shall be borne as provided in the Separation and Distribution Agreement.

          Section 7.04 Governing Law. This Agreement and any dispute arising out of, in connection with
or relating to this Agreement shall be governed by and construed in accordance with the Laws of the
State of Texas, without giving effect to the conflicts of laws principles thereof.

          Section 7.05 Notices. All notices, requests, claims, demands and other communications
hereunder must be in writing and will be deemed to have been duly given only if delivered
personally or by facsimile transmission or mailed (first class postage prepaid) to the Parties at
the following addresses or facsimile numbers:

If to Belo or any member of the Belo Group, to:

Belo Corp.

400 South Record Street

Dallas, TX 75202

Attn: Chief Executive Officer

Facsimile: (214) 977-8209

with a copy to:

Belo Corp.

400 South Record Street

Dallas, TX 75202

Attn: Chief Financial Officer

Facsimile: (214) 977-8209

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If to A. H. Belo or any member of the A. H. Belo Group, to:

A. H. Belo Corporation

400 South Record Street

Dallas, TX 75202

Attn: Chief Executive Officer

Facsimile: (214) 977-8209

with a copy to:

A. H. Belo Corporation

400 South Record Street

Dallas, TX 75202

Attn: Chief Financial Officer

Facsimile: (214) 977-6899

     All such notices, requests and other communications will (i) if delivered personally to the
address as provided in this section, be deemed given upon delivery, (ii) if delivered by facsimile
transmission to the facsimile number as provided in this section, be deemed given upon receipt and
(iii) if delivered by mail in the manner described above to the address as provided in this
section, be deemed given upon receipt (in each case regardless of whether such notice, request or
other communication is received by any other Person to whom a copy of such notice, request or other
communication is to be delivered pursuant to this section). Any party from time to time may change
its address, facsimile number or other information for the purpose of notices to that party by
giving notice specifying such change to the other party.

          Section 7.06 Amendment, Modification or Waiver.

          (a) Prior to the Distribution, this Agreement may be amended, modified, waived, supplemented
or superseded, in whole or in part, by Belo in its sole discretion by execution of a written
amendment delivered to A. H. Belo. Subsequent to the Distribution, this Agreement may be amended,
modified, supplemented or superseded only by an instrument signed by duly authorized signatories of
both Parties.

          (b) Following the Distribution, any term or condition of this Agreement may be waived at any
time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective
unless set forth in a written instrument duly executed by or on behalf of the Party waiving such
term or condition. No waiver by any Party of any term or condition of this Agreement, in any one
or more instances, shall be deemed or construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion. All remedies, either under this Agreement or
by Law or otherwise afforded, will be cumulative and not alternative.

          Section 7.07 No Assignment; Binding Effect. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or in part, by operation
of law or otherwise by any of the Parties without the prior written consent of the other Party;
provided, however, that no such consent shall be required in the event of a merger, consolidation
or sale of either Belo or A. H. Belo. Subject to the preceding sentence, this

22

 

Agreement is binding upon, inures to the benefit of and is enforceable by the Parties hereto
and their respective successors and assigns.

          Section 7.08 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same
instrument.

          Section 7.09 Specific Performance. From and after the Distribution, in the event of any
actual or threatened default in, or breach of, any of the terms, conditions and provisions of this
Agreement, the Parties agree that the Party or Parties to this Agreement who are or are to be
thereby aggrieved shall have the right to specific performance and injunctive or other equitable
relief of its or their rights under this Agreement, in addition to any and all other rights and
remedies at law or in equity, and all such rights and remedies shall be cumulative. The Parties
agree that, from and after the Distribution, the remedies at law for any breach or threatened
breach of this Agreement, including monetary damages, are inadequate compensation for any loss,
that any defense in any action for specific performance that a remedy at law would be adequate is
hereby waived, and that any requirements for the securing or posting of any bond with such remedy
are hereby waived.

          Section 7.10 Texas Forum. Each of the Parties agrees that, except as otherwise provided in
Section 6.01, all Actions arising out of or in connection with this Agreement, or for recognition
and enforcement of any judgment arising out of or in connection with this Agreement, shall be tried
and determined exclusively in the state or federal courts in the State of Texas, County of Dallas,
and each of the Parties hereby irrevocably submits with regard to any such action or proceeding for
itself and in respect to its property, generally and unconditionally, to the exclusive jurisdiction
of the aforesaid courts. Each of the Parties hereby expressly waives any right it may have to
assert, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any
such action or proceeding: (a) any claim that it is not subject to personal jurisdiction in the
aforesaid courts for any reason; (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; and (c) any
claim that (i) any of the aforesaid courts is an inconvenient or inappropriate forum for such
action or proceeding, (ii) venue is not proper in any of the aforesaid courts and (iii) this
Agreement, or the subject matter hereof, may not be enforced in or by any of the aforesaid courts.
Each of the Parties agrees that mailing of process or other papers in connection with any such
action or proceeding in the manner provided in Section 7.05 or any other manner as may be permitted
by Law shall be valid and sufficient service thereof.

          Section 7.11 WAIVER OF JURY TRIAL. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO
A TRIAL BY JURY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE WAIVER IN THIS SECTION, (ii) SUCH PARTY UNDERSTANDS AND
HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER, (iii)

23

 

SUCH PARTY MAKES SUCH WAIVER VOLUNTARILY AND (iv) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS, AGREEMENTS AND CERTIFICATIONS HEREIN.

          Section 7.12 Interpretation; Conflict With Ancillary Agreements. The language of this
Agreement shall be construed according to its fair meaning and shall not be strictly construed for
or against any Party. Notwithstanding the foregoing, the purposes of Article IV are to ensure the
Tax-Free Status and, accordingly, the Parties agree that the language thereof shall be interpreted
in a manner that serves this purpose to the greatest extent possible. The Article and Section
headings contained in this Agreement are solely for the purpose of reference, are not part of the
agreement of the Parties and shall not in any way affect the meaning or interpretation of this
Agreement. If, and to the extent, the provisions of this Agreement conflict with the Separation
and Distribution Agreement, or any Ancillary Agreement, the provisions of this Agreement shall
control.

          Section 7.13 Severability. If any provision of this Agreement is held to be illegal, invalid
or unenforceable under any present or future Law, the remaining provisions of this Agreement will
remain in full force and effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom.

          Section 7.14 Survival. Except with respect to Sections 5.07, 5.08 and 5.09 which shall remain
in effect without limitation as to time, the provisions in this Agreement shall be unconditional
and absolute and shall remain in effect until the expiration of the statute of limitations for all
taxable periods that end before or include the date on which the Distribution occurs and the
resolution of all disputes under this Agreement that arose during such periods.

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

	 	 	 	 	 
	 	BELO CORP.

 	 
	 	By:  	/s Dennis A. Williamson
 	 
	 	 	Name:  	Dennis A. Williamson 	 
	 	 	Title:  	Executive Vice President/Chief

Financial Officer 	 
	 

	 	 	 	 	 
	 	A. H. BELO CORPORATION

 	 
	 	By:  	/s/ Alison K. Engel
 	 
	 	 	Name:  	Alison K. Engel 	 
	 	 	Title:  	Senior Vice President/Chief Financial

Officer and Treasurer 	 
	 

25

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