Document:

<PAGE>
                                                                   Exhibit 10.20

                                KIRBY CORPORATION

                    Nonemployee Director Compensation Program

Annual Director Fee

     1. Each director will receive an annual fee of $20,000, payable in four
equal quarterly payments to be made at the end of each calendar quarter, unless
the director elects to receive a stock option for shares of Kirby common stock
in lieu of all or part of the cash fee. The fee will be prorated for any
director elected between annual stockholder meetings.

     2. The election to receive a stock option in lieu of director fees will be
made annually. Any director who elects to receive a stock option in lieu of all
or part of the annual fee for the year following any annual meeting of
stockholders must give written notice of that election to Kirby no later than
the date of such annual meeting, except that a director elected between annual
stockholder meetings must give written notice of that election to Kirby no later
than the date of his or her election as a director. Directors who elect to
receive a stock option in lieu of all or part of the unpaid portion of the
annual fee for the year in which this program becomes effective must give
written notice of that election to Kirby no later than September 29, 2000.

     3. The stock option shall be issued on the following terms:

          (a) The number of shares of stock subject to the option will be equal
     to (i) the portion of the annual fee that a director elects to receive in
     the form of a stock option divided by (ii) the fair market value of a share
     of stock on the date of grant multiplied by (iii) 3, with the result then
     rounded to the nearest whole share.

          (b) The exercise price will be the fair market value on the date of
     grant. The fair market value of a share of stock means the mean of the high
     and low sales price on the New York Stock Exchange on the date of
     reference. The date of grant of an option granted in lieu of the annual fee
     means the date by which a director must make the election to receive the
     option in lieu of cash fees.

          (c) The option will vest one-fourth on the first quarterly payment
     date, one-fourth on the second quarterly payment date, one-fourth on the
     third quarterly payment date and one-fourth on the fourth quarterly payment
     date or, in the case of a director elected between annual stockholder
     meetings or a director receiving an option for the year in which this
     program becomes effective, in equal parts on the remaining quarterly
     payment dates prior to the first anniversary of the most recent annual
     meeting of stockholders.

          (d) The options will be subject to the terms of the plan under which
     they are issued, including without limitation provisions relating to
     vesting, exercise, termination and transferability.

<PAGE>

     4. The quarterly payment of cash fees and vesting of stock options are
contingent on a director's continuing to serve in that capacity on each such
quarterly payment or vesting date.

Annual Committee Chairman Fee

     1. The Chairman of the Audit Committee and the Chairman of the Compensation
Committee will receive an annual fee of $10,000, payable in four equal quarterly
payments to be made at the end of each calendar quarter. The committee chairman
fee will be prorated for any director who is elected to such position between
annual meetings of the board of directors.

     2. The quarterly payment of the committee chairman fee is contingent on a
director's continuing to serve in such position on each such quarterly payment
date.

Meeting Fees

     1. Each director will receive a fee of $1,000 for each board meeting
attended in person or by telephone.

     2. Each member of a committee of the board will receive a fee of $3,000 for
each committee meeting attended in person or by telephone.

Automatic Stock Option Grants

     1. Each director will receive an option for 5,000 shares of Kirby common
stock upon his or her first election as a director.

     2. Each director will receive an option for 3,000 shares of Kirby common
stock immediately after each annual meeting of stockholders.

     3. The option price in both cases will be the fair market value on the date
of grant. The options will be subject to the terms of the plan under which they
are issued, including without limitation provisions relating to vesting,
exercise, termination and transferability.

General

     1. This compensation program became effective September 26, 2000 and was
amended effective October 21, 2002 to add the annual committee chairman fees and
to increase the meeting fees for committee members..

     2. This compensation program may be amended, modified or terminated by the
board at any time.

     3. This compensation program applies only to directors of Kirby who are not
employees of Kirby or any of its subsidiaries.

ADOPTED BY THE BOARD OF DIRECTORS: September 26, 2000
AMENDED:  OCTOBER 21, 2002<PAGE>
                                                                     Exhibit 4.1

                                                                  EXECUTION COPY

                              SETTLEMENT AGREEMENT

                                      among

                            TV AZTECA, S.A. DE C.V.,

                        AZTECA INTERNATIONAL CORPORATION,

                          PAPPAS TELECASTING COMPANIES,

                 PAPPAS TELECASTING OF SOUTHERN CALIFORNIA LLC,

                    PAPPAS SOUTHERN CALIFORNIA LICENSE, LLC,

                         PAPPAS TELECASTING OF HOUSTON,

                        HISPANIC AMERICA OF HOUSTON, LLC,

                         PAPPAS TELECASTING OF CONCORD,

                     HISPANIC AMERICA OF SAN FRANCISCO, LLC

                          PAPPAS TELECASTING OF NEVADA,

                     PAPPAS TELECASTING OF ARIZONA, LLC, and

                           PAPPAS ARIZONA LICENSE, LLC

                          Dated as of February 11, 2003

<PAGE>

                                TABLE OF CONTENTS

                                                                        Page No.
                                                                        --------
ARTICLE I DEFINITIONS .................................................    4
        Section 1.1  Definitions ......................................    4
        Section 1.2  Other Definitions ................................    6

ARTICLE II OVERVIEW OF THE TRANSACTIONS AND THE CLOSING ...............    7
        Section 2.1  Deliveries at the Closing.........................    7
        Section 2.2  The Closing ......................................    9
        Section 2.3  Simultaneous Closing .............................   10

ARTICLE III OTHER AGREEMENTS ..........................................   10
        Section 3.1  Mutual Cooperation as to Pending Litigations .....   10
        Section 3.2  KAZA-DT Channel 47  ..............................   11
        Section 3.3  Limited Indemnification ..........................   11
        Section 3.4  Termination of Certain Prior Agreements ..........   12
        Section 3.5  AIC's Petition for Waiver for National Spot
                       Advertising.....................................   12
        Section 3.6  Refinancing of PTSC Debt .........................   13
        Section 3.7  Third Party Debt Covenants .......................   13
        Section 3.8  EchoStar Injunction ..............................   13
        Section 3.9  New Station Affiliates ...........................   13
        Section 3.10 Appointment of FCC Expert ........................   13
        Section 3.11 Stipulations of Dismissal ........................   14

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PAPPAS PARTIES .......   14
        Section 4.1  Existence and Power ..............................   14
        Section 4.2  Authorization ....................................   14
        Section 4.3  No Contravention..................................   14
        Section 4.4  Binding Effect ...................................   15

ARTICLE V REPRESENTATIONS AND WARRANTIES OF AZTECA PARTIES ............   15
        Section 5.1  Existence and Power ..............................   15
        Section 5.2  Authorization ....................................   16
        Section 5.3  No Contravention .................................   16
        Section 5.4  Binding Effect ...................................   16

ARTICLE VI GENERAL TERMS ..............................................   17
        Section 6.1  Amendment ........................................   17
        Section 6.2  Entire Agreement .................................   17
        Section 6.3  Survival of Representations and Warranties .......   17

<PAGE>

        Section 6.4  Successors and Assigns ...........................   17
        Section 6.5  Confidentiality ..................................   18
        Section 6.6  Notices ..........................................   18
        Section 6.7  Counterparts .....................................   20
        Section 6.8  Headings; Gender .................................   20
        Section 6.9  Further Assurances ...............................   20
        Section 6.10 Rule of Construction .............................   20
        Section 6.11 Remedies .........................................   20
        Section 6.12 Specific Performance .............................   20
        Section 6.13 Consent to Jurisdiction ..........................   21
        Section 6.14 GOVERNING LAW ....................................   21

Schedules
---------
Schedule 2.1(j) New Station Affiliates
Schedule 3.4    Terminated Agreements

Exhibits
--------
Exhibit A-1     Purchase and Sale Agreement
Exhibit A-2     Amendment to the HAH Operating Agreement
Exhibit A-3     Amendment to the HASF Operating Agreement
Exhibit B-1     Amended and Restated Credit Agreement
Exhibit B-2     Amended and Restated Note
Exhibit B-3     Amended and Restated Securities Pledge Agreement
Exhibit B-4     Amended and Restated Security Agreement
Exhibit B-5     Amended and Restated Guarantee
Exhibit C-1     Amended and Restated Affiliation Agreement
Exhibit C-2     New Affiliation Agreement Guaranty
Exhibit C-3     Agreement Not to Compete
Exhibit D       Mutual Release Agreement
Exhibit E-1     Stipulation of Dismissal (New York)
Exhibit E-2     Stipulation of Dismissal (Delaware)
Exhibit E-3     Stipulation of Dismissal (California)
Exhibit F-1     Local Marketing Agreement
Exhibit F-2     LMA Guaranty
Exhibit G       New Option Agreement
Exhibit H       Legal Opinion of Kaye Scholer LLP
Exhibit I       Legal Opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP
Exhibit J       Withdrawal of Objection

<PAGE>

                                                                  EXECUTION COPY

                              SETTLEMENT AGREEMENT

     Settlement Agreement (the "Settlement Agreement"), dated as of February 11,
2003, by and among each of:

     (a) TV Azteca, S.A. de C.V., a sociedad anonima de capital variable
incorporated under the laws of Mexico ("TVA");

     (b) Azteca International Corporation, a Delaware corporation and an
indirect wholly-owned subsidiary of TVA ("AIC");

     (c) Pappas Telecasting Companies, a Nevada corporation ("PTC");

     (d) Pappas Telecasting of Southern California LLC, a Delaware limited
liability company ("PTSC");

     (e) Pappas Southern California License, LLC, a Delaware limited liability
company ("PSC License");

     (f) Pappas Telecasting of Houston, a California limited partnership
("Pappas Houston");

     (g) Hispanic America of Houston, LLC, a Delaware limited liability company
("HAH");

     (h) Pappas Telecasting of Concord, a California limited partnership
("Pappas Concord");

     (i) Hispanic America of San Francisco, LLC, a Delaware limited liability
company ("HASF");

     (j) Pappas Telecasting of Nevada, a California limited partnership ("Pappas
Nevada");

     (k) Pappas Telecasting of Arizona, LLC, an Arizona limited liability
company ("Pappas Arizona"); and

     (l) Pappas Arizona License, LLC, a Delaware limited liability company
("Arizona License").

<PAGE>
                                                                               2

                                    RECITALS

     A. The Parties.

     Mr. Harry J. Pappas holds 100% of the issued and outstanding equity
interests of PTC. PTC is the manager of and holds 4.44% of the issued and
outstanding equity interests of PTSC. Messrs. Pappas, LeBon G. Abercrombie and
Dennis J. Davis hold 86.68%, 4.44% and 4.44%, respectively, of the issued and
outstanding equity interests of PTSC. PTSC is the sole member of PSC License.
Under the terms and conditions of the Amended and Restated Equity Option
Agreement, dated as of December 31, 2001 (the "Existing Equity Option
Agreement"), by and between AIC and PTSC, PTSC granted AIC the right to purchase
a percentage of the equity interest of PTSC calculated in accordance with the
terms and conditions of such agreement.

     Mr. Pappas is the general partner of Pappas Houston. Pappas Houston holds
75% of the issued and outstanding equity interests of HAH. AIC holds the
remaining 25% of the issued and outstanding equity interests of HAH ("AIC's HAH
Interest"), which it acquired pursuant to the terms and conditions of the
Subscription Agreement, dated as of December 31, 2001 (the "Subscription
Agreement"), by and among HASF, HAH, Pappas Concord, Pappas Houston, TVA and
AIC. HAH is governed pursuant to the terms of the Amended and Restated Operating
Agreement of HAH, dated as of December 31, 2001 (the "HAH Operating Agreement").

     Each of Mr. Pappas and PTC is a general partner of Pappas Concord. Pappas
Concord holds 75% of the issued and outstanding equity interest of HASF. AIC
holds the remaining 25% of the issued and outstanding equity interests of HASF
("AIC's HASF Interest"), which it acquired pursuant to the terms and conditions
of the Subscription Agreement. HASF is governed pursuant to the terms of the
Amended and Restated Operating Agreement of HASF, dated as of December 31, 2001
(the "HASF Operating Agreement").

     Pappas Nevada is a party to an Existing Affiliation Agreement (as defined
below) with AIC.

     Pappas Arizona and Arizona License are parties to the Existing Guarantee
Agreement and the Existing Security Agreement (each as defined below).

     B. Certain Existing Agreements between the Parties.

          1. Affiliation Agreements.

     Pursuant to (i) the Amended and Restated Station Affiliation Agreement,
dated as of December 31, 2001, between AIC and PTSC, with respect to KAZA-TV,
NTSC Channel 54, which serves the Los Angeles, California designated market
area; (ii) the Station Affiliation Agreement, dated as of December 31, 2001,
between AIC and HAH, with respect to KAZH-TV, NTSC Channel 57 and DTV Channel
41, and KVVV-LP, NTSC Channel 53, which serve the Houston, Texas designated
market area; (iii) the

<PAGE>

                                                                               3

Station Affiliation Agreement, dated as of December 31, 2001, between AIC and
HASF with respect to KTNC-TV, NTSC Channel 42 and DTV Channel 63, which serve
the San Francisco-Oakland-San Jose, California designated market area; and (iv)
the Station Affiliation Agreement, dated as of October 31, 2001, between AIC and
Pappas Nevada, with respect to KUVR-LP, NTSC Channels 47 and 68, which serve the
Reno-Sparks-Carson City, Nevada designated market area (the agreements in
clauses (i) - (iv) collectively, the "Existing Affiliation Agreements"), AIC
granted the relevant Pappas Party an exclusive license for certain broadcasting
of AIC's programming in the relevant designated market area and AIC and such
Pappas Party agreed, among other things, to share certain advertising revenue
generated by AIC and by such Pappas Party.

          2. Indebtedness of PTSC to TVA.

          (a) PTSC (as borrower) and TVA (as lender) are parties to that certain
     Credit Agreement, dated as of July 21, 2001 (the "Existing TVA Credit
     Agreement"). As of the date hereof, the aggregate amount outstanding
     (including principal and interest thereon) under the Existing TVA Credit
     Agreement is $56,147,922.48 (fifty-six million, one hundred forty-seven
     thousand nine hundred twenty-two dollars and forty-eight cents).

          (b) The obligations of PTSC under the Existing TVA Credit Agreement
     are (i) guaranteed pursuant to the Guarantee Agreement, dated as of July
     30, 2001 (the "Existing Guarantee Agreement"), by and among TVA, AIC,
     Pappas Arizona, Arizona License and PSC License and (ii) secured under (x)
     a Security Agreement, dated as of July 30, 2001 (the "Existing Security
     Agreement"), by and among PTSC, PSC License, Pappas Arizona, Arizona
     License, TVA and AIC, and (y) a Securities Pledge Agreement, dated as of
     July 30, 2001, by and among PTC, Messrs. Pappas, Davis and Abercrombie, TVA
     and AIC.

     C. The Option Exercise and the Pending Litigation.

     Pursuant to the Existing Equity Option Agreement, AIC gave notice to PTSC
of AIC's intent to exercise its option to purchase a percentage of the equity
interests in PTSC. The acquisition by AIC of an equity interest in PTSC was not
consummated by the parties on the anticipated closing date, whereupon (i) AIC
filed suit against PTSC in Delaware Chancery Court (Azteca International
Corporation v. Pappas Telecasting of Southern California LLC, Civ. A. No. 19783
(Del. Ch. Ct.)) (the "Delaware Action") and (ii) PTSC and PSC License filed suit
against the Azteca Parties in California state court (Pappas Telecasting of
Southern California LLC and Pappas Southern California License LLC v. TV Azteca,
S.A. de C.V. and Azteca International Corporation, Case No. 02-201389 (Sup.
Ct.)) (the "California Action"). The California Action was stayed by the
agreement of the parties.

     Subsequently, (i) AIC filed suit against each PTSC, HAH, HASF and Pappas
Nevada in New York state court (Azteca International Corporation v. Pappas
Telecasting of Southern California LLC, et al., Index No. 602847/02 (Sup. Ct.
N.Y. Cty.)

<PAGE>

                                                                               4

and (ii) the relevant Pappas Parties filed counterclaims against each of the
Azteca Parties (collectively, the "New York Action").

     D. Agreement in Principle.

     PTSC and AIC entered into the Agreement in Principle, dated as of November
27, 2002 ("Agreement in Principle"), to settle all outstanding issues between
them and their respective Affiliates with respect to, among other things, (i)
the Delaware Action, (ii) the New York Action and (iii) the California Action.

     In connection with the Agreement in Principle, the New York Action has been
stayed and the trial date in respect of the Delaware Action has been postponed
until March 3, 2003.

     NOW, THEREFORE, in consideration of the premises and mutual covenants
herein, and for other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the parties hereto, intending to
be legally bound, hereby agree as follows:

                                   ARTICLE I

                                  DEFINITIONS

     Section 1.1 Definitions.

     Capitalized terms used but not otherwise defined in this Settlement
Agreement shall have the meanings specified in this Article I.

     "Affiliate" means, with respect to any Person, any other Person that
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person. For the purposes of
this definition, the term "controls," "is controlled by" or "under common
control with" 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 the ownership of voting securities, by contract or otherwise.

     "Azteca Parties" means, collectively, TVA and AIC.

     "Business Day" means any day other than a Saturday, Sunday or other day on
which commercial banks in the State of New York or Mexico City, Mexico are
authorized or required by law or executive order to close.

     "Claims" means any actions, suits, proceedings, claims, complaints,
disputes, arbitrations or investigations.

     "Contractual Obligations" means, as to any Person, any security issued by
such Person or any agreement, undertaking, contract, indenture, mortgage, deed
of trust

<PAGE>

                                                                               5

or other instrument to which such Person is a party or by which it or any of its
property is bound.

     "Expense" means any and all expenses incurred in connection with
investigating, defending or asserting any Claim incident to any matter
indemnified against in Section 3.3 (including, without limitation, court filing
fees, court costs, arbitration fees or costs, witness fees, and reasonable fees
and disbursements of legal counsel, investigators, expert witnesses,
consultants, accountants and other professionals).

     "Governmental Authority" (i) when used herein in connection with any
representation, warranty, covenant, agreement or obligation of the Seller, means
the government of the United States of America and any state, city, locality or
other political subdivision thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing Governmental
Authorities referred to in this clause (i); and (ii) when used herein in
connection with any representation, warranty, covenant, agreement or obligation
of the Optionee, means the governments of the United States of America and
Mexico and any state, city, locality or other political subdivision thereof, any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, and any corporation or other entity
owned or controlled, through stock or capital ownership or otherwise, by any of
the foregoing Governmental Authorities referred to in this clause (ii).

     "Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, encumbrance, lien (statutory or other) or preference, priority,
right of first offer or first refusal, exchange or option right, or other
security interest or preferential arrangement of any kind or nature whatsoever
(excluding preferred stock and equity related preferences).

     "Pappas Parties" means, collectively, PTC, PTSC, HAH, Pappas Concord, HASF,
Pappas Houston, Pappas Nevada, PSC License, Pappas Arizona and Arizona License.

     "Person" means any individual, firm, corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint stock company,
limited liability company, Governmental Authority or other entity of any kind,
and shall include any successor (by merger or otherwise) of such entity.

     "Requirements of Law" means, as to any Person, any law, statute, treaty,
rule, regulation, right, privilege, qualification, license or franchise or
determination of an arbitrator or a court or other Governmental Authority or
stock exchange, in each case applicable to or binding upon such Person or any of
its property or to which such Person or any of its property is subject or
pertaining to any or all of the transactions contemplated or referred to herein.

<PAGE>
                                                                               6

     "Transaction Documents" means this Settlement Agreement, the Amended and
Restated Affiliation Agreements, the New Affiliation Agreements, the New
Affiliation Agreement Guaranties, the Agreements Not to Compete, the Purchase
and Sale Agreement, the Amended and Restated Credit Agreement, the Amended and
Restated Note, the Amended and Restated Security Agreement, the Amended and
Restated Securities Pledge Agreement, the Amended and Restated Guarantee, the
Amendment to the HAH Operating Agreement, the Amendment to the HASF Operating
Agreement, the Local Marketing Agreement, the LMA Guaranty, the New Option
Agreement and the Mutual Release Agreement.

     Section 1.2 Other Definitions.

     As used herein, the following terms shall have the meanings ascribed to
them in the section of this Settlement Agreement opposite such term:

     Definitions                                           Section
     -----------                                           -------
     Agreement in Principle                                Recitals
     Agreements Not to Compete                             Section 2.1(l)
     AIC                                                   Preamble
     AIC's HAH Interest                                    Recitals
     AIC's HASF Interest                                   Recitals
     Amended and Restated Affiliation Agreements           Section 2.1(i)
     Amended and Restated Credit Agreement                 Section 2.1(d)
     Amended and Restated Guarantee                        Section 2.1(h)
     Amended and Restated Note                             Section 2.1(e)
     Amended and Restated Securities Pledge Agreement      Section 2.1(f)
     Amended and Restated Security Agreement               Section 2.1(g)
     Amendment to the HAH Operating Agreement              Section 2.1(b)
     Amendment to the HASF Operating Agreement             Section 2.1(c)
     Arizona License                                       Preamble
     Asserted Liability                                    Section 3.3(b)
     Azteca Parties                                        Recitals
     Azteca Release                                        Section 2.1(j)
     California Action                                     Recitals
     Claims Notice                                         Section 3.3(b)
     Closing                                               Section 2.2
     Closing Date                                          Section 2.2
     Contemplated Transactions                             Section 2.2
     Delaware Action                                       Recitals
     Digital Station                                       Section 3.2
     Echostar Litigation                                   Section 3.1(a)
     Existing Affiliation Agreements                       Recitals
     Existing Equity Option Agreement                      Recitals
     Existing Guarantee Agreement                          Recitals
     Existing Security Agreement                           Recitals
     Existing TVA Credit Agreement                         Recitals

<PAGE>
                                                                               7

     FCC                                                   Section 3.2
     HAH                                                   Preamble
     HAH Operating Agreement                               Recitals
     HASF                                                  Preamble
     HASF Operating Agreement                              Recitals
     Indemnifying Party                                    Section 3.3(b)
     Indemnitee                                            Section 3.3(b)
     LMA Guaranty                                          Section 2.1(p)
     Local Marketing Agreement                             Section 2.1(o)
     Losses                                                Section 3.3(a)
     Mutual Release Agreement                              Section 2.1(m)
     New Affiliation Agreements                            Section 2.1(j)
     New Affiliation Agreement Guaranties                  Section 2.1(k)
     New Option Agreement                                  Section 2.1(q)
     New Station Affiliates                                Section 2.1(q)
     New York Action                                       Recitals
     Orders                                                Section 4.3
     Pappas Arizona                                        Preamble
     Pappas Concord                                        Preamble
     Pappas Houston                                        Preamble
     Pappas Indemnified Party                              Section 3.3(a)
     Pappas Nevada                                         Preamble
     Pappas Release                                        Section 2.1(j)
     PSC License                                           Preamble
     PTC                                                   Preamble
     PTSC                                                  Preamble
     Purchase and Sale Agreement                           Section 2.1(a)
     SCT                                                   Section 3.2
     SCT Concurrence                                       Section 3.2
     Settlement Agreement                                  Preamble
     Stipulations of Dismissal                             Section 2.1(n)
     Subscription Agreement                                Recitals
     Terminated Agreements                                 Section 3.4
     TVA                                                   Preamble
     UBS Credit Agreement                                  Recitals

                                   ARTICLE II

                  OVERVIEW OF THE TRANSACTIONS AND THE CLOSING

     Section 2.1 Deliveries at the Closing.

     Subject to the terms of, and upon the satisfaction or waiver of the
conditions to be satisfied on the Closing Date set forth in, this Settlement
Agreement and the other Transaction Documents, on the Closing Date:

<PAGE>
                                                                               8

     (a) each of AIC, PTSC, HAH, HASF, Pappas Houston and Pappas Concord shall
execute and deliver a purchase and sale agreement with respect to AIC's HAH
Interest, AIC's HASF Interest and the note issued by PTSC pursuant to the
Existing TVA Credit Agreement, in the form attached as Exhibit A-1 hereto (the
"Purchase and Sale Agreement");

     (b) Pappas Houston shall execute and deliver the Second Amended and
Restated Operating Agreement of HAH, in the form attached as Exhibit A-2 hereto
(the "Amendment to the HAH Operating Agreement");

     (c) Pappas Concord shall execute and deliver the Second Amended and
Restated Operating Agreement of HASF, in the form attached as Exhibit A-3 hereto
(the "Amendment to the HASF Operating Agreement");

     (d) each of PTSC and AIC shall execute and deliver an amended and restated
credit agreement, in the form attached as Exhibit B-1 hereto (the "Amended and
Restated Credit Agreement");

     (e) PTSC shall execute and deliver to AIC a secured promissory note, in the
form attached as Exhibit B-2 hereto, for an initial principal amount of
$128,000,000 (one hundred twenty-eight million dollars) (the "Amended and
Restated Note");

     (f) each of PTC, Messrs. Pappas, Davis, Abercrombie and AIC shall execute
and deliver an amended and restated securities pledge agreement, in the form
attached as Exhibit B-3 hereto (the "Amended and Restated Securities Pledge
Agreement");

     (g) each of PTSC, PSC License, PTC, Pappas Arizona, Arizona License and AIC
shall execute and deliver an amended and restated security agreement, in the
form attached as Exhibit B-4 hereto (the "Amended and Restated Security
Agreement");

     (h) each of Pappas Arizona, Arizona License, PSC License and PTSC shall
execute and deliver an amended and restated guarantee agreement in favor of AIC,
in the form attached as Exhibit B-5 hereto (the "Amended and Restated
Guarantee");

     (i) AIC and each of PTSC, HAH, HASF and Pappas Nevada, as to its respective
designated market area, shall execute and deliver an amended and restated
station affiliation agreement, in the form attached as Exhibit C-1 hereto
(collectively, the "Amended and Restated Affiliation Agreements"), amending and
restating their respective Existing Affiliation Agreements;

     (j) AIC and each station affiliate set forth on Schedule 2.1(j) hereto
(collectively, the "New Station Affiliates") designated by the Pappas Parties on
or prior to the Closing Date shall execute and deliver a station affiliation
agreement, in the form of the Amended and Restated Affiliation Agreement, with
respect to the station in the

<PAGE>
                                                                               9

designated market area set forth opposite the name of such New Station Affiliate
on Schedule 2.1(j) (collectively, the "New Affiliation Agreements");

     (k) in connection with each New Affiliation Agreement, each of TVA and the
New Station Affiliate executing a New Affiliation Agreement shall execute and
deliver a guaranty agreement with respect to such New Affiliation Agreement in
the form attached hereto as Exhibit C-2 (collectively, the "New Affiliation
Agreement Guaranties")

     (l) in connection with each New Affiliation Agreement, each of TVA, PTC
(and Mr. Harry J. Pappas) shall execute and deliver the Agreement Not to Compete
with respect to the designated market area covered by such New Affiliation
Agreement, in the form attached as Exhibit C-3 hereto (collectively, the
"Agreements Not to Compete");

     (m) each of the Pappas Parties (and the other Persons related to Pappas
Parties named therein) and the Azteca Parties shall execute and deliver a mutual
general release, in the form attached as Exhibit D hereto (the "Mutual Release
Agreement");

     (n) each of the Pappas Parties and Azteca Parties shall cause their
respective counsel to execute and file with the relevant court the stipulations
of dismissal, in the forms attached as Exhibits E-1, E-2 and E 3 hereto
(collectively, the "Stipulations of Dismissal"), dismissing the New York Action,
the Delaware Action and the California Action (including the claims and
counterclaims) with prejudice and without costs;

     (o) each of PTSC, PSC License and AIC shall execute and deliver a local
marketing agreement, in the form attached as Exhibit F-1 hereto (the "Local
Marketing Agreement");

     (p) each of TVA and PTSC shall execute and deliver a guaranty agreement
with respect to the Local Marketing Agreement, in the form attached as Exhibit
F-2 hereto (the "LMA Guaranty");

     (q) each of PTSC and AIC shall execute and deliver an option agreement, in
the form attached as Exhibit G hereto (the "New Option Agreement");

     (r) The Azteca Parties shall have received an opinion of Kaye Scholer LLP,
dated the Closing Date, relating to the Contemplated Transactions, substantially
in the form attached hereto as Exhibit H; and

     (s) The Pappas Parties shall have received an opinion of Paul, Weiss,
Rifkind, Wharton & Garrison LLP, dated the Closing Date, relating to the
Contemplated Transactions, substantially in the form attached hereto as
Exhibit I.

     Section 2.2 The Closing.

     The closing (the "Closing") of the execution and delivery of the documents
described in Section 2.1 and the other transactions contemplated by this

<PAGE>

                                                                              10

Settlement Agreement and the other Transaction Documents to occur concurrently
therewith (but specifically excluding (x) the effectiveness of the Option (as
defined in the New Option Agreement) granted to AIC by PTSC which is subject to
the conditions set forth in Section 2.1 of the New Option Agreement, (y) the
commencement of the Term (as defined in the Local Marketing Agreement) of the
Local Marketing Agreement which is subject to the conditions set forth in
Section 3.1 of the Local Marketing Agreement and (z) the effectiveness of the
LMA Guaranty which is subject to the commencement of the Term of the Local
Marketing Agreement) (collectively, the "Contemplated Transactions") shall take
place at the offices of Paul, Weiss, Rifkind, Wharton & Garrison LLP, in New
York City or such other place as the parties may agree, on the date hereof. The
date on which the Closing occurs is the "Closing Date."

     Section 2.3 Simultaneous Closing.

     The obligations of the parties hereto to consummate the Closing of the
Contemplated Transactions are subject to the simultaneous execution and delivery
of all the Transaction Documents (but specifically excluding (x) the
effectiveness of the Option (as defined in the New Option Agreement) granted to
AIC by PTSC which is subject to the conditions set forth in Section 2.1 of the
New Option Agreement, (y) the commencement of the Term (as defined in the Local
Marketing Agreement) of the Local Marketing Agreement which is subject to the
conditions set forth in Section 3.1 of the Local Marketing Agreement and (z) the
effectiveness of the LMA Guaranty which is subject to the commencement of the
Term of the Local Marketing Agreement).

                                  ARTICLE III

                                OTHER AGREEMENTS

     Section 3.1 Mutual Cooperation as to Pending Litigations.

     (a) For a period of one (1) year after the Closing Date, each of the Pappas
Parties agrees to use its commercially reasonable efforts to cooperate (by
providing requested documentation and information and making available
representatives thereof) with the Azteca Parties from time to time and as
reasonably requested by the Azteca Parties in connection with the pending
litigation captioned Echostar Satellite Corporation v. TV Azteca S.A. de C.V.,
No. 02 Civ. 4890 (AKH) (S.D.N.Y.) (the "Echostar Litigation").

     (b) For a period of one (1) year after the Closing Date, each of the Azteca
Parties agrees to use its commercially reasonable efforts to cooperate (by
providing requested documentation and information and making available
representatives thereof) with the Pappas Parties from time to time and as
reasonably requested by the Pappas Parties in connection with the pending
litigation between the Pappas Parties and Citicorp Venture Capital (the
"Citicorp Litigation").

<PAGE>
                                                                              11

     Section 3.2 KAZA-DT Channel 47.

     TVA agrees to use its reasonable commercial efforts to assist PTSC in
gaining the concurrence (the "SCT Concurrence") of the Secretaria de
Comunicaciones y Transportes of Mexico (the "SCT") with the allocation by the
Federal Communications Commission of the United States (the "FCC") of digital
channel 47, KAZA-DT (the "Digital Station"), to PTSC; provided, however, that,
so long as TVA complies with its obligations under this Section 3.2, neither
AIC, TVA nor any of their respective Affiliates shall be liable to PTSC if the
SCT fails to grant the SCT Concurrence or for any action of the FCC as to the
allocation of the Digital Station.

     Section 3.3 Limited Indemnification.

     (a) Notwithstanding any provision to the contrary in this Settlement
Agreement or the Mutual Release Agreement and subject to the limitations
contained in Section 3.3(b),

          (i) the Azteca Parties, jointly and severally, agree to indemnify and
     hold harmless each of the Pappas Parties, KAZH License, LLC and KTNC
     License, LLC (each a "Pappas Indemnified Party") from and against all fines
     and other penalties imposed by a Governmental Authority and related
     Expenses (collectively, "Losses") based upon, arising out of or otherwise
     in respect of any breach of any Requirement of Law by any Pappas
     Indemnified Party arising directly from any action, or failure to act when
     required to act, of any Azteca Party under the Existing Affiliation
     Agreements and any other agreement between the parties during any period
     prior to the Closing Date; and

          (ii) the Pappas Parties, jointly and severally, agree to indemnify and
     hold harmless each of the Azteca Parties from and against all Losses based
     upon, arising out of or otherwise in respect of any breach of any
     Requirement of Law by any of the Azteca Parties arising directly from any
     action, or failure to act when required to act, of any Pappas Party under
     the Existing Affiliation Agreements and any other agreement between the
     parties during any period prior to the Closing Date.

     (b) The party making a Claim under this Section 3.3 is referred to as the
"Indemnitee," and the party against whom such Claims are asserted under this
Section 3.3 is referred to as the "Indemnifying Party." All Claims by any
Indemnitee under this Section 3.3 shall be asserted and resolved as follows:
Promptly after receipt by the Indemnitee of notice of any Claim or circumstances
which, with the lapse of time, would or might give rise to a Claim or the
commencement (or threatened commencement) of a Claim (an "Asserted Liability")
that may result in a Loss imposed by a Governmental Authority, the Indemnitee
shall give notice thereof (the "Claims Notice") to the Indemnifying Party. The
Claims Notice shall describe the Asserted Liability in reasonable detail, and
shall indicate the amount (estimated, if necessary and to the extent feasible)
of the Loss that has been or may be suffered by the Indemnitee. The Indemnifying
Party may elect to compromise or defend, at its own expense and by its own
counsel, any Asserted Liability. If the Indemnifying Party elects to compromise
or

<PAGE>
                                                                              12

defend such Asserted Liability, it shall within 30 days (or sooner, if the
nature of the Asserted Liability so requires) notify the Indemnitee of its
intent to do so, and the Indemnitee shall cooperate, at the expense of the
Indemnifying Party, in the compromise of, or defense against, such Asserted
Liability. If the Indemnifying Party elects not to compromise or defend the
Asserted Liability, fails to notify the Indemnitee of its election as herein
provided or contests its obligation to indemnify under this Settlement
Agreement, the Indemnitee may pay, compromise or defend such Asserted Liability.
Notwithstanding the foregoing, neither the Indemnifying Party nor the Indemnitee
may settle or compromise any Asserted Liability over the objection of the other;
provided, however, consent to settlement or compromise shall not be unreasonably
withheld. In any event, the Indemnitee and the Indemnifying Party may
participate, at their own expense, in the defense of such Asserted Liability. If
the Indemnifying Party chooses to defend any Asserted Liability, the Indemnitee
shall make available to the Indemnifying Party any books, records or other
documents within its control that are necessary or appropriate for such defense.

     Section 3.4 Termination of Certain Prior Agreements.

     The execution of this Settlement Agreement by each of the Azteca Parties
and Pappas Parties shall constitute the written agreement of these parties that
the agreements set forth on Schedule 3.4 hereto (collectively, the "Terminated
Agreements") shall, effective as of the date hereof, be deemed terminated and of
no further force and effect and without further obligation of any party
thereunder.

     Section 3.5 AIC's Petition for Waiver for National Spot Advertising.

     (a) On or prior to the Closing Date, each of the Pappas Parties shall have
withdrawn any and all objections such Pappas Parties' filed with or otherwise
submitted to the FCC with respect to AIC's petition for waiver for authorization
to sell advertising for affiliates of the Azteca America Network (other than
affiliates owned or controlled by Harry J. Pappas) by filing with the FCC the
withdrawal, in the form attached hereto as Exhibit J,

     (b) During the term of the Amended and Restated Affiliation Agreements and
the New Affiliation Agreements, AIC covenants, for itself and its Affiliates,
not to sell any advertising for broadcast on the Azteca America Network (or any
successor) other than as specifically permitted in Rider A to the Amended and
Restated Affiliation Agreements and the New Affiliation Agreements. For the
avoidance of doubt, AIC covenants, for itself and its Affiliates, not to sell,
or attempt to sell, on its own or through representatives or agents, local or
national spot advertising on behalf of any Azteca America Network affiliate that
is a Pappas Party or owned or controlled by a Pappas Party or Harry J. Pappas
except that, if the Local Marketing Agreement becomes effective pursuant to its
terms, then during the Term (as defined therein) of the Local Marketing
Agreement, AIC may sell local and national spot advertising on behalf of
KAZA-TV.

<PAGE>
                                                                              13

     Section 3.6 Refinancing of PTSC Debt. From and after the date hereof and
until the Option Effective Date (as defined in the New Option Agreement), as
requested from time to time by AIC or its representatives, the Pappas Parties
shall keep AIC and its representatives reasonably informed with respect to the
status of PTSC's efforts to secure financing to pay the PTSC Debt (as defined in
the Amended and Restated Credit Agreement).

     Section 3.7 Third Party Debt Covenants. During the Term of the Local
Marketing Agreement (as such term is defined in the Local Marketing Agreement)
if (i) AIC has knowledge of the covenants contained in any instrument or
agreement creating or evidencing indebtedness of PTSC permitted pursuant to
Section 6.1(j) of the Amended and Restated Credit Agreement, (ii) AIC shall have
been provided with a copy of, and a reasonable opportunity to comment on, each
such instrument or agreement prior to its execution by PTSC and (iii) such
instrument or agreement contains commercially reasonable and standard covenants,
AIC shall exercise reasonable commercial efforts to refrain from causing as a
direct result of its actions, or failure to act when it had an obligation to act
under the terms of the Local Marketing Agreement, a material breach by PTSC of
any such covenants. AIC acknowledges and agrees that the affirmative and
negative covenants contained in the Amended and Restated Credit Agreement are
commercially reasonable and standard covenants.

     Section 3.8 EchoStar Injunction. If, prior to the Maturity Date (as
determined in accordance with clause (i) of the definition of Maturity Date set
forth in Section 1.2 of the Amended and Restated Credit Agreement), an Echostar
Injunction (as defined in the Amended and Restated Credit Agreement) is issued,
and the PTSC Debt (as defined in the Amended and Restated Credit Agreement) is
not paid in full before the EchoStar Injunction is issued, then, upon the
issuance of the EchoStar Injunction, the Local Marketing Agreement and the New
Option Agreement shall terminate automatically and be void ab initio and clauses
(y) and (z) of the last sentence of Section 9.4 of the Amended and Restated
Affiliation Agreements shall be deemed to be deleted effective on the date the
Echostar Injunction is issued.

     Section 3.9 New Station Affiliates. Notwithstanding the provisions of the
New Affiliation Agreements, the term of each New Affiliation Agreement shall
commence on the date the New Station Affiliate first telecasts the Network
Programs over its station.

     Section 3.10 Appointment of FCC Expert. AIC and PTSC have appointed R.
Clark Wadlow, Esq. as the "FCC Expert", as defined in the Amended and Restated
Affiliation Agreements, the New Affiliation Agreements and the Local Marketing
Agreement and as the "Option Expert" as defined in the New Option Agreement.
AIC, PTSC and PTC (for itself and its Affiliates) agree that at all times the
same individual shall be appointed by the relevant parties as FCC Expert or
Option Expert under each of these Transaction Documents, and that the relevant
parties shall take all actions necessary to ensure that any successor FCC Expert
or Option Expert appointed under any such Transaction Document shall also be
appointed the successor

<PAGE>

                                                                              14

FCC Expert or Option Expert under each other such Transaction Document, as well
as any station affiliation agreements entered after the Closing Date pursuant to
Section 3.9.

     Section 3.11 Stipulations of Dismissal.The parties hereto agree that the
Stipulation of Dismissal in the Delaware Action constitutes a termination of the
Status Quo Agreement and Order entered on August 20, 2002.ARTICLE IV

              REPRESENTATIONS AND WARRANTIES OF THE PAPPAS PARTIES

     The Pappas Parties, jointly and severally, represent and warrant as
follows:

     Section 4.1 Existence and Power.

     Each of the Pappas Parties is a limited liability company or a limited
partnership, duly formed, or corporation, duly organized, in each case validly
existing and in good standing under the laws of the state of its jurisdiction of
formation or incorporation. Each of the Pappas Parties has, as the case may be,
(i) the legal capacity and (ii) the requisite entity-level power and authority
to execute and deliver this Settlement Agreement and the other Transaction
Documents to which it is (or after giving effect to the Closing shall be) a
party, to perform all of its obligations hereunder and thereunder required to be
performed on the Closing Date and to cause its counsel to file with the relevant
court the Stipulations of Dismissal.

     Section 4.2 Authorization.

     Each of the Pappas Parties has duly authorized the execution, delivery and
performance of this Settlement Agreement and the other Transaction Documents to
which it is (or after giving effect to the Closing shall be) a party and the
filing by its counsel with the relevant court the Stipulations of Dismissal.

     Section 4.3 No Contravention.

     The execution, delivery and performance by each of the Pappas Parties of
this Settlement Agreement and each of the other Transaction Documents to which
it is (or after giving effect to the Closing shall be) a party and the
Contemplated Transactions (but specifically excluding (x) the effectiveness of
the Option (as defined in the New Option Agreement) granted to AIC by PTSC which
is subject to the conditions set forth in Section 2.1 of the New Option
Agreement and (y) the commencement of the Term (as defined in the Local
Marketing Agreement) of the Local Marketing Agreement which is subject to the
conditions set forth in Section 3.1 of the Local Marketing Agreement), and the
filing by its counsel with the relevant court the Stipulations of Dismissal do
not (i) if applicable, contravene the terms of the constituent or organizational
documents of such Pappas Party, (ii) violate, conflict with or result in any
breach, default or contravention of (or with due notice or lapse of time or both
would result in any breach, default or contravention of), or the creation of any
Lien under, any material Contractual Obligation of any Pappas Party or any
Requirement of Law applicable to such Pappas Party, or (iii)

<PAGE>

                                                                              15

violate any judgment, injunction, writ, award, decree or order (collectively,
"Orders") of any Governmental Authority against, or binding upon, the Pappas
Parties.

     Section 4.4 Binding Effect.

     This Settlement Agreement and each of the other Transaction Documents to
which any of the Pappas Parties are (or after giving effect to the Closing shall
be) a party have been (or shall have been, on and as of the Closing Date) duly
executed and delivered by such Pappas Party, and, assuming due execution and
delivery thereof by the other parties hereto and thereto, this Settlement
Agreement and each of the other Transaction Documents to which any of the Pappas
Parties are (or after giving effect to the Closing shall be) a party constitute,
the legal, valid and binding obligation of such Pappas Party, enforceable
against such Pappas Party in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity relating to enforceability (regardless of whether
considered in a proceeding at law or in equity); provided, however, that (x) the
effectiveness of the Option (as defined in the New Option Agreement) granted to
AIC by PTSC is subject to the conditions set forth in Section 2.1 of the New
Option Agreement and (y) the commencement of the Term (as defined in the Local
Marketing Agreement) of the Local Marketing Agreement is subject to the
conditions set forth in Section 3.1 of the Local Marketing Agreement.

     None of the Pappas Parties is making any representation or warranty as to
any matter concerning AIC's (i) power and authority or (ii) legal right to hold
the Option (as defined in the New Option Agreement), to exercise the Option, to
acquire the FCC Licenses (as defined in the New Option Agreement) or to
otherwise consummate the transactions contemplated in the New Option Agreement,
whether under the Communications Act or any other Requirement of Law.

                                   ARTICLE V

                REPRESENTATIONS AND WARRANTIES OF AZTECA PARTIES

     The Azteca Parties, jointly and severally, hereby represent and warrant as
follows:

     Section 5.1 Existence and Power.

     TVA is a sociedad anonima de capital variable incorporated under the laws
of Mexico. AIC is a corporation, duly organized, validly existing and in good
standing under the laws of the state of Delaware. Each of the Azteca Parties has
the requisite entity-level power and authority to execute and deliver this
Settlement Agreement and the other Transaction Documents to which it is (or
after giving effect to the Closing shall be) a party and to perform all of its
obligations hereunder and thereunder required to be performed on the Closing
Date and to cause its counsel to file with the relevant court the Stipulations
of Dismissal.

<PAGE>
                                                                              16

     Section 5.2 Authorization.

     Each of the Azteca Parties has duly authorized the execution, delivery and
performance of this Settlement Agreement and the other Transaction Documents to
which it is (or after giving effect to the Closing shall be) a party and the
filing by its counsel with the relevant court the Stipulations of Dismissal.

     Section 5.3 No Contravention.

     The execution, delivery and performance by each of the Azteca Parties of
this Settlement Agreement and each of the other Transaction Documents to which
it is (or after giving effect to the Closing shall be) a party and the
Contemplated Transactions (but specifically excluding (x) the effectiveness of
the Option (as defined in the New Option Agreement) granted to AIC by PTSC which
is subject to the conditions set forth in Section 2.1 of the New Option
Agreement, (y) the commencement of the Term (as defined in the Local Marketing
Agreement) of the Local Marketing Agreement which is subject to the obtaining of
the conditions set forth in Section 3.1 of the Local Marketing Agreement and (z)
the effectiveness of the LMA Guaranty which is subject to the commencement of
the Term of the Local Marketing Agreement), and the filing by its counsel with
the relevant court the Stipulations of Dismissal do not (i) contravene the terms
of the constituent or organizational documents of any Azteca Party, (ii)
violate, conflict with or result in any breach, default or contravention of (or
with due notice or lapse of time or both would result in any breach, default or
contravention of), or the creation of any Lien under, any material Contractual
Obligation of any such Azteca Party or any Requirement of Law applicable to any
Azteca Party, or (iii) violate any Order of any Governmental Authority against,
or binding upon, such Azteca Party.

     Section 5.4 Binding Effect.

     This Settlement Agreement and each of the other Transaction Documents to
which any of the Azteca Parties is (or after giving effect to the Closing shall
be) a party have been (or shall have been, on and as of the Closing Date) duly
executed and delivered by such Azteca Party, and, assuming due execution and
delivery thereof by the other parties hereto and thereto, this Settlement
Agreement and each of the other Transaction Documents to which any of the Azteca
Parties is (or after giving effect to the Closing shall be) a party constitute,
the legal, valid and binding obligation of such Azteca Party, enforceable
against such Azteca Party in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity relating to enforceability (regardless of whether
considered in a proceeding at law or in equity); provided, however, that (x) the
effectiveness of the Option (as defined in the New Option Agreement) granted to
AIC by PTSC is subject to the conditions set forth in Section 2.1 of the New
Option Agreement, (y) the commencement of the Term (as defined in the Local
Marketing Agreement) of the Local Marketing Agreement is subject to the
conditions set forth in Section 3.1 of the Local Marketing Agreement and (z) the

<PAGE>

                                                                              17

effectiveness of the LMA Guaranty is subject to the commencement of the Term of
the Local Marketing Agreement.

                                   ARTICLE VI

                                  GENERAL TERMS

     Section 6.1 Amendment.

     Any amendment, supplement or modification of or to any provision of this
Settlement Agreement, and any waiver of any provision of this Settlement
Agreement shall be effective (i) only if it is made or given in writing and
signed by each of the Azteca Parties and Pappas Parties and (ii) only in the
specific instance and for the specific purpose for which made or given. No
failure to exercise and no delay in exercising on the part of any party hereto
any right, remedy, power or privilege provided in this Settlement Agreement or
by statute or at law or in equity shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, remedy, power or privilege
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. No course of dealing between the parties
hereto shall operate as a waiver of any right, power or privilege hereunder of
any such party. Each and every default by any of the parties under this
Settlement Agreement shall give rise to a separate cause of action hereunder,
and separate suits may be brought under this Settlement Agreement as each cause
of action arises.

     Section 6.2 Entire Agreement.

     This Settlement Agreement, together with the exhibits and schedules hereto,
and the other Transaction Documents are intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein and therein. There are no restrictions,
promises, representations, warranties or undertakings, other than those set
forth or referred to herein or therein. This Settlement Agreement, together with
the exhibits and schedules hereto, and the other Transaction Documents supersede
all prior agreements and understandings between the parties with respect to such
subject matter, including, without limitation, the Terminated Agreements.

     Section 6.3 Survival of Representations and Warranties.

     All of the representations and warranties made herein shall survive the
execution and delivery of this Settlement Agreement.

     Section 6.4 Successors and Assigns.

     This Settlement Agreement shall inure to the benefit of and be binding upon
the successors and permitted assigns of the parties hereto.

<PAGE>
                                                                              18

     No Pappas Party, on the one hand, and no Azteca Party, on the
other hand, shall assign or delegate any of its rights or duties hereunder
without the prior written consent of the other (which the other may withhold in
its sole discretion).

     Section 6.5 Confidentiality.

     No statement announcing in any way the Contemplated Transactions shall be
issued by (i) any of the Azteca Parties, without the prior written consent of
the Pappas Parties as to the specific content of such statement, such consent
not to be unreasonably withheld or delayed, (ii) any of the Pappas Parties,
without the prior written consent of the Azteca Parties as to the specific
content of such statement, such consent not to be unreasonably withheld or
delayed; provided that this Section 6.5 shall not apply (a) in the event such
disclosure is required by any pending litigation or any Requirement of Law (as
determined in good faith by counsel to the Azteca Parties or the Pappas Parties,
as applicable), including if a court of competent jurisdiction or a duly
authorized Governmental Authority requires any such statement in a final order
or (b) if there is a Requirement of Law (as determined in good faith by counsel
to the Azteca Parties or the Pappas Parties, as applicable) for the filing of
this Settlement Agreement or any other Transaction Document with a Governmental
Authority or other disclosure to a Governmental Authority related to any
Transaction Document and, provided, further, that the parties hereto are
expressly authorized to disclose to any and all Persons the structure and tax
aspects of the Contemplated Transactions and all materials of any kind that are
provided to such party related to such structure and tax aspects.

     Section 6.6 Notices.

     All notices, demands and other communications hereunder shall be made in
writing and shall be by registered or certified first-class mail, return receipt
requested, courier service or personal delivery:

                       (i) if to any of the Pappas Parties,

                           c/o Pappas Telecasting Companies
                           500 South Chinowth Road
                           Visalia, CA  93277
                           Tel:  (559) 733-7800
                           Attention:  Dennis J. Davis

                           with a copy to:

                           Kaye Scholer LLP
                           425 Park Avenue
                           New York, NY  10022
                           Tel:  (212) 836-8000
                           Attention:  Lynn Toby Fisher, Esq.
                                       Aaron Rubinstein, Esq.

<PAGE>
                                                                              19

                           and

                           Paul, Hastings, Janofsky & Walker LLP
                           1299 Pennsylvania Avenue, N.W.
                           Tenth Floor
                           Washington, DC 20004
                           Tel.  (202) 508-9500
                           Attention:  John G. Johnson, Esq.

                      (ii) if to any of the Azteca Parties,

                           TV Azteca, S.A. de C.V.
                           Periferico Sur 4121
                           Col. Fuentes de Pedregal
                           C.P. 14141 Mexico
                           Delegacion Tlalpan
                           Mexico, D.F.
                           Tel:  011-525-5-3099-5751
                           Attention: Lic. Francisco X. Borrego Hinojosa

                           with a copy to:

                           Paul, Weiss, Rifkind, Wharton & Garrison LLP
                           1285 Avenue of the Americas
                           New York, NY 10019-6064
                           Tel:  (212) 373-3000
                           Attention:   Judith R. Thoyer, Esq.
                                        Jay Cohen, Esq.
                           and

                           Hogan & Hartson L.L.P
                           555 Thirteenth Street, N.W.
                           Washington, DC  20004
                           Tel:  (202) 637-5877
                           Attention:  Mace J. Rosenstein, Esq.
                                       Jacqueline P. Cleary, Esq.

     All such notices, demands and other communications shall be deemed to have
been duly given when delivered by hand, if personally delivered; when delivered
by courier, if delivered by commercial courier service; or when actually
received, if mailed. If a notice would be deemed to be given by the preceding
sentence after 5:00 p.m. local time on a Business Day or on a day that is not a
Business Day, such notice shall instead be deemed to have been given on the
immediately following Business Day. Any party may by notice given in accordance
with this Section 6.6 designate another address or Person for receipt of notices
hereunder, but such notice shall not be effective until actually received.

<PAGE>
                                                                              20

     Section 6.7 Counterparts.

     This Settlement Agreement may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same agreement. Execution
and delivery of this Settlement Agreement by exchange of facsimile copies
bearing the facsimile signature of a party hereto shall constitute a valid and
binding execution and delivery of this Settlement Agreement by such party. Such
facsimile copies shall constitute enforceable original documents.

     Section 6.8 Headings; Gender.

     The headings in this Settlement Agreement are inserted for convenience of
reference only and shall not affect the interpretation of this Settlement
Agreement. As used herein, masculine pronouns shall include the feminine and
neuter, neuter pronouns shall include the masculine and feminine, and the
singular shall be deemed to include the plural.

     Section 6.9 Further Assurances.

     Subject to the other provisions of this Settlement Agreement, each party
hereto agrees to execute, acknowledge, deliver, file and record such further
certificates, amendments, instruments and documents, and to do all such other
acts and things, as may be required by law or as may be necessary, advisable or
convenient to carry out the intent and purpose of this Settlement Agreement.

     Section 6.10 Rule of Construction.

     The general rule of construction for interpreting a contract, which
provides that the provisions of a contract should be construed against the party
preparing the contract, is waived by the parties hereto. Each party acknowledges
that such party was represented by separate legal counsel in this matter who
participated in the preparation of this Settlement Agreement and the other
Transaction Documents or such party had the opportunity to retain counsel to
participate in the preparation of this Settlement Agreement and the other
Transaction Documents but elected not to do so.

     Section 6.11 Remedies.

     Except as otherwise provided herein, no remedy herein conferred or reserved
is intended to be exclusive of any other available remedy or remedies, and each
and every remedy shall be cumulative and shall be in addition to every remedy
under this Settlement Agreement or now or hereafter existing at law or in
equity.

     Section 6.12 Specific Performance.

     Each party hereto acknowledges and agrees that its respective remedies at
law for a breach or threatened breach of any of the provisions of this
Settlement

<PAGE>

                                                                              21

Agreement would be inadequate and, in recognition of that fact, agrees that, in
the event of a breach or threatened breach by any party of the provisions of
this Settlement Agreement, in addition to any remedies at law, the other parties
shall, without posting any bond, be entitled to obtain equitable relief in the
form of specific performance, a temporary restraining order, a temporary or
permanent injunction or any other equitable remedy which may then be available.

     Section 6.13 Consent to Jurisdiction.

     Any Claim arising out of or relating to this Agreement or the Contemplated
Transactions contemplated hereby shall be brought by the parties and heard and
determined only in Delaware Chancery Court, unless Delaware Chancery Court
determines that it does not have jurisdiction over such Claim, in which case
such Claim may be brought by the parties and heard and determined only in
Delaware state court or a federal court sitting in Delaware. The parties hereto
consent to jurisdiction before and waive any objections of venue to the Delaware
Chancery Court, Delaware state court and any federal court sitting in Delaware.
Each party agrees not to assert, by way of motion, as a defense or otherwise, in
any such Claim, that it is not subject personally to the jurisdiction of any
such courts, that such Claim is brought in an inconvenient forum, that the venue
of such Claim is improper or that this Agreement or the subject matter hereof
may not be enforced in or by any such courts. Each party further irrevocably
submits to the jurisdiction of Delaware Chancery Court, Delaware state court and
any federal court sitting in Delaware in any such Claim. Each of the parties
irrevocably consents to service of process in the manner provided for notices in
Section 6.6. Nothing herein contained shall be deemed to affect the right of any
party to serve process in any manner permitted by law.

     Section 6.14 GOVERNING LAW.

     THIS SETTLEMENT AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF
CONFLICTS OF LAW THEREOF.

<PAGE>

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

                               TV AZTECA, S.A. DE C.V.

                               By:   /s/ Francisco X. Borrego
                                     -------------------------------------------
                                     Name:  Francisco X. Borrego
                                     Title: General Counsel

                               AZTECA INTERNATIONAL CORPORATION

                               By:   /s/ Luis J. Echarte
                                     -------------------------------------------
                                     Name:  Luis J. Echarte
                                     Title: Chief Executive Officer

                               By:   /s/ Francisco X. Borrego
                                     -------------------------------------------
                                     Name:  Francisco X. Borrego
                                     Title: Director

                               By:   /s/ Carlos Hesles Flores
                                     -------------------------------------------
                                     Name:  Carlos Hesles Flores
                                     Title: Director

                               PAPPAS TELECASTING COMPANIES

                               By:   /s/ Harry Pappas
                                     -------------------------------------------
                                     Name:  Harry Pappas
                                     Title: President

                               PAPPAS TELECASTING OF SOUTHERN CALIFORNIA LLC

                               By: Pappas Telecasting Companies,
                                   its Manager

                               By:   /s/ Harry Pappas
                                     -------------------------------------------
                                     Name:  Harry Pappas
                                     Title: President

                               PAPPAS SOUTHERN CALIFORNIA LICENSE, LLC

                               By: Pappas Telecasting of Southern California
                                   LLC, its Sole Member

                                   By: Pappas Telecasting Companies,
                                       its Manager

                                        By:   /s/ Harry Pappas
                                            ------------------------------------
                                            Name:  Harry Pappas
                                            Title: President

                               PAPPAS TELECASTING OF HOUSTON,
                               a California limited partnership

                               By:   /s/ Harry Pappas
                                     -------------------------------------------
                                     Name:  Harry Pappas
                                     Title: President

                               HISPANIC AMERICA OF HOUSTON, LLC

                               By:   /s/ Harry Pappas
                                     -------------------------------------------
                                     Name:  Harry Pappas
                                     Title: General Partner

<PAGE>

                               PAPPAS TELECASTING OF CONCORD,
                               a California limited partnership

                               By:   /s/ Harry Pappas
                                     -------------------------------------------
                                     Name:  Harry Pappas
                                     Title: President

                               HISPANIC AMERICA OF SAN FRANCISCO, LLC

                               By:   /s/ Harry Pappas
                                     -------------------------------------------
                                     Name:  Harry Pappas
                                     Title: General Partner

                               PAPPAS TELECASTING OF NEVADA

                               By: Pappas Telecasting Companies,
                                   its Manager

                                   By:  /s/ Harry Pappas
                                        ----------------------------------------
                                        Name:  Harry Pappas
                                        Title: President

                               PAPPAS TELECASTING OF ARIZONA, LLC

                               By: Pappas Telecasting Companies,
                                   its Manager

                                   By:  /s/ Harry Pappas
                                        ----------------------------------------
                                        Name:  Harry Pappas
                                        Title: President

                               PAPPAS ARIZONA LICENSE, LLC

                               By: Pappas Telecasting of Arizona, LLC,
                                   its Sole Member

                                   By: Pappas Telecasting Companies,
                                       its Manager

                                       By:   /s/ Harry Pappas
                                            ------------------------------------
                                            Name:  Harry Pappas
                                            Title: President

<PAGE>

                           CONSENT AND ACKNOWLEDGEMENT

     On this 11th day of February, 2003, the undersigned, as members of Pappas
Telecasting of Southern California LLC ("PTSC"), and individually with respect
to paragraph (b) below, hereby acknowledge, consent and agree to:

     (a) the execution, delivery and performance by PTSC of the Settlement
Agreement, dated as of the date hereof, by and among TV Azteca, S.A. de C.V.
("TVA"), Azteca International Corporation ("AIC"), Pappas Telecasting Companies
("PTC"), PTSC, Pappas Southern California License, LLC, Pappas Telecasting of
Houston, a California Limited Partnership, Hispanic America of Houston, LLC,
Pappas Telecasting of Concord, a California Limited Partnership, Hispanic
America of San Francisco, LLC, Pappas Telecasting of Nevada, a California
Limited Partnership, Pappas Telecasting of Arizona, LLC and Pappas Arizona
License, LLC including, without limitation, the entry of PTSC into and the
performance by PTSC of the

          (i) Local Marketing Agreement, dated as of the date hereof, by and
     among PTSC, Pappas Southern California License, LLC, and AIC,

          (ii) the Amended and Restated Credit Agreement, dated as of the date
     hereof, by and between PTSC and AIC, and

          (iii) the Option Agreement, dated as of the date hereof, by and
     between PTSC and AIC; and

     (b) be bound as a Pappas Party with respect to Section 3.1(a) of the
Settlement Agreement.

     IN WITNESS WHEREOF, the undersigned have signed this Consent,
Acknowledgement and Agreement as of the day and year first above written.

                                           /s/ Harry J. Pappas
                                           -------------------------------------
                                           Harry J. Pappas

                                           /s/ Dennis J. Davis
                                           -------------------------------------
                                           Dennis J. Davis

                                           /s/ LeBon G. Abercrombie
                                           -------------------------------------
                                           LeBon G. Abercrombie

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