Document:

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                                                                    EXHIBIT 10.3

                                                                  EXECUTION COPY

                        Nexstar Finance Holdings, L.L.C.
                         Nexstar Finance Holdings, Inc.
                                   as Issuers

                                  $130,000,000

                     11.375% Senior Discount Notes due 2013

                               Purchase Agreement

                           dated as of March 18, 2003

                         Banc of America Securities LLC
                             Bear Stearns & Co. Inc.

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                                Table of Contents

<TABLE>
<S>                                                                                                     <C>
SECTION 1.        Representations and Warranties.........................................................2
   (a)   No Registration Required........................................................................2
   (b)   No Integration of Offerings or General Solicitation.............................................2
   (c)   Eligibility for Resale under Rule 144A..........................................................3
   (d)   The Offering Memorandum.........................................................................3
   (e)   The Purchase Agreement..........................................................................3
   (f)   The Registration Rights Agreement...............................................................3
   (g)   Authorization of the Notes and the Exchange Notes...............................................4
   (h)   Authorization of the Indenture..................................................................4
   (i)   Description of the Notes and the Indenture......................................................4
   (j)   No Material Adverse Change......................................................................4
   (k)   Independent Accountants.........................................................................5
   (l)   Preparation of the Financial Statements.........................................................5
   (m)   Incorporation and Good Standing of the Company and its Subsidiaries.............................5
   (n)   Capitalization..................................................................................6
   (o)   Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required......6
   (p)   No Material Actions or Proceedings..............................................................6
   (q)   Intellectual Property Rights....................................................................7
   (r)   All Necessary Permits, etc......................................................................7
   (s)   FCC Licenses....................................................................................7
   (t)   Condition of Stations...........................................................................8
   (u)   Title to Properties.............................................................................8
   (v)   Tax Law Compliance..............................................................................8
   (w)   Company Not an "Investment Company".............................................................9
   (x)   Insurance.......................................................................................9
   (y)   No Price Stabilization or Manipulation..........................................................9
   (z)   Company's Accounting System.....................................................................9
   (aa)  ERISA Compliance................................................................................9
   (bb)  Regulation S...................................................................................10
SECTION 2.        Purchase, Sale and Delivery of the Notes..............................................10
   (a)   The Notes......................................................................................10
   (b)   The Closing Date...............................................................................10
   (c)   Delivery of the Notes..........................................................................11
   (d)   Delivery of Offering Memorandum to the Initial Purchasers......................................11
   (e)   Initial Purchaser as Qualified Purchaser.......................................................12
   (f)   Resale of Notes................................................................................12
SECTION 3.        Additional Covenants..................................................................12
   (a)   Initial Purchasers' Review of Proposed Amendments and Supplements..............................12
   (b)   Amendments and Supplements to the Offering Memorandum and Other Securities Act Matters.........12
   (c)   Copies of the Offering Memorandum..............................................................13
   (d)   Blue Sky Compliance............................................................................13
   (e)   Use of Proceeds................................................................................13
   (f)   The Depositary.................................................................................13
   (g)   Additional Issuer Information..................................................................13
   (h)   Future Reports to the Initial Purchasers.......................................................14
   (i)   No Integration.................................................................................14
   (j)   Legended Notes.................................................................................14
   (k)   PORTAL.........................................................................................14
SECTION 4.        Payment of Expenses...................................................................14
SECTION 5.        Conditions of the Obligations of the Initial Purchasers...............................15
   (a)   Accountants' Comfort Letter....................................................................15
</TABLE>

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<TABLE>
<S>                                                                                                     <C>
   (b)   No Material Adverse Change or Ratings Agency Change............................................15
   (c)   Financial Information..........................................................................16
   (d)   Opinion of Counsel for the Company.............................................................16
   (e)   Opinion of Regulatory Counsel for the Company..................................................16
   (f)   Opinion of Counsel for the Initial Purchasers..................................................16
   (g)   Officers' Certificate..........................................................................16
   (h)   PORTAL Listing.................................................................................16
   (i)   Registration Rights Agreement..................................................................17
   (j)   Indenture......................................................................................17
   (k)   Additional Documents...........................................................................17
SECTION 6.        Reimbursement of Initial Purchasers' Expenses.........................................17
SECTION 7.        Offer, Sale and Resale Procedures.....................................................17
SECTION 8.        Indemnification.......................................................................18
   (a)   Indemnification of the Initial Purchaser.......................................................18
   (b)   Indemnification of the Company, its Directors and Officers.....................................19
   (c)   Notifications and Other Indemnification Procedures.............................................20
   (d)   Settlements....................................................................................20
SECTION 9.        Contribution..........................................................................21
SECTION 10.       Termination of this Agreement.........................................................22
SECTION 11.       Representations and Indemnities to Survive Delivery...................................22
SECTION 12.       Notices...............................................................................23
SECTION 13.       Successors............................................................................23
SECTION 14.       Partial Unenforceability..............................................................24
SECTION 15.       Governing Law Provisions..............................................................24
SECTION 16.       Consent to Jurisdiction...............................................................24
SECTION 17.       Default of One or More of the Several Initial Purchasers..............................24
SECTION 18.       General Provisions....................................................................25
</TABLE>

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                               PURCHASE AGREEMENT

                                                                  March 18, 2003

BANC OF AMERICA SECURITIES LLC
BEAR STEARNS & CO. INC.
c/o BANC OF AMERICA SECURITIES LLC
9 West 57th Street, 31st Floor
New York, New York 10019

Ladies and Gentlemen:

                  Nexstar Finance Holdings, L.L.C., a Delaware limited liability
company, and Nexstar Finance Holdings, Inc., a Delaware corporation (together,
the "Company"), propose to issue and sell to the several Initial Purchasers
named in Schedule I (the "Initial Purchasers"), acting severally and not
jointly, the respective amounts set forth in such Schedule I of the Company's
11.375% Senior Discount Notes due 2013 (the "Notes"). Banc of America LLC has
agreed to act as the lead Initial Purchaser in connection with the offering and
the sale of the Notes.

                  The Notes will be issued pursuant to an indenture, to be dated
as of the Closing Date (as defined below) (the "Indenture"), among the Company,
Mission Broadcasting, Inc. ("Mission") and United States Trust Company of New
York, as trustee (the "Trustee"). Notes issued in book-entry form will be issued
in the name of Cede & Co., as nominee of The Depository Trust Company (the
"Depositary").

                  The holders of the Notes will be entitled to the benefits of a
registration rights agreement, to be dated as of Closing Date (the "Registration
Rights Agreement"), among the Company and the Initial Purchasers, pursuant to
which the Company will agree to file, within 90 days after the Closing Date, a
registration statement with the Commission registering the Exchange Notes (as
defined below) under the Securities Act.

                  The Company understands that the Initial Purchasers propose to
make an offering of the Notes on the terms and in the manner set forth herein
and to be set forth in the Offering Memorandum (as defined below) and agrees
that the Initial Purchasers may resell, subject to the conditions set forth
herein, all or a portion of the Notes to purchasers (the "Subsequent
Purchasers") at any time after the date of this Agreement. The Notes are to be
offered and sold to or through the Initial Purchasers without being registered
with the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933 (as amended, the "Securities Act," which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder), in reliance upon exemptions therefrom. The terms of the Notes and
the Indenture will require that investors that acquire Notes expressly agree
that Notes may only be resold or

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otherwise transferred, after the date hereof, if such Notes are registered for
sale under the Securities Act or if an exemption from the registration
requirements of the Securities Act is available (including the exemptions
afforded by Rule 144A ("Rule 144A") or Regulations S ("Regulation S")
thereunder). The terms of the Notes and the Indenture will require that
investors that acquire Notes expressly agree that Notes, may only be resold or
otherwise transferred, after the date hereof, if such Notes are registered for
sale under the Securities Act or if an exemption from the registration
requirements of the Securities Act is available (including the exemptions
afforded by Rule 144A or Regulation S ("Regulation S") thereunder).

                  The Company will prepare on or before two business days prior
to the Closing Date, and deliver to the Initial Purchasers, copies of the
Offering Memorandum describing the terms of the Notes, each for use by such
Initial Purchaser in connection with its solicitation of offers to purchase the
Notes. As used herein, the "Offering Memorandum" shall mean, with respect to any
date or time referred to in this Agreement, the Company's Offering Memorandum,
to be dated on or before such date, including amendments or supplements thereto,
any exhibits thereto, in the most recent form that will be prepared and
delivered by the Company to the Initial Purchasers in connection with its
solicitation of offers to purchase Notes. Such Offering Memorandum shall provide
the information described in Section 2(d) hereof and otherwise in form and
substance reasonably acceptable to the Initial Purchasers. Further, any
reference to the Offering Memorandum shall be deemed to refer to and include any
Additional Issuer Information (as defined in Section 3) furnished by the
Company's prior to the completion of the distribution of the Notes.

                  The Company hereby confirms its agreement with the Initial
Purchasers as follows:

SECTION 1.        Representations and Warranties. The Company hereby represents,
warrants and covenants to each Initial Purchaser on the date hereof, on the date
of delivery of the Offering Memorandum and on the Closing Date, as follows:

         (a)      No Registration Required. Subject to compliance by the Initial
Purchasers with the representations and warranties set forth in Section 2 hereof
and with the procedures set forth in Section 7 hereof, it is not necessary in
connection with the offer, sale and delivery of the Notes to the Initial
Purchasers and to each Subsequent Purchaser in the manner contemplated by this
Agreement and the Offering Memorandum to register the Notes under the Securities
Act or, until such time as the Exchange Notes are issued pursuant to an
effective registration statement, to qualify the Indenture under the Trust
Indenture Act of 1939 (the "Trust Indenture Act," which term, as used herein,
includes the rules and regulations of the Commission promulgated thereunder).

         (b)      No Integration of Offerings or General Solicitation. The
Company has not, directly or indirectly, solicited any offer to buy or offered
to sell, nor will, directly or indirectly, solicit any offer to buy or offer to
sell, in the United States or to any United States citizen or resident, any
security which is or would be integrated with the sale of the Notes in a manner
that would require any of the Notes to be registered under the Securities Act.
The Company, its affiliates as such term is defined in Rule 501 under the
Securities Act (each, an "Affiliate"), or any person acting on its behalf (other
than the Initial Purchasers, as to whom the Company makes no representation or
warranty) has not engaged or will not engage, in connection with the offering of
the Notes, in any form of general solicitation or general advertising within the
meaning of Rule 502 under the Securities Act. With respect to those Notes sold
in reliance upon Regulation S, the Company or its Affiliates or any person
acting on its behalf (other than the Initial Purchasers, as to whom the Company
makes no representation or warranty) has not engaged or will not engage in any
directed selling efforts within the meaning of Regulation S.

         (c)      Eligibility for Resale under Rule 144A. The Notes are eligible
for resale pursuant to Rule 144A and will not be, at the Closing Date, of the
same class as securities listed on a national

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securities exchange registered under Section 6 of the Exchange Act or quoted in
a U.S. automated interdealer quotation system.

         (d)      The Offering Memorandum. The Offering Memorandum, as of its
date and at the Closing Date, will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided that this representation, warranty and agreement shall not
apply to statements in or omissions from the Offering Memorandum made in
reliance upon and in conformity with information furnished to the Company in
writing by any Initial Purchaser expressly for use in the Offering Memorandum.
The Offering Memorandum, as of its date, will contain all the information
specified in, and meeting the requirements of, Rule 144A. The Company has not
distributed or will not distribute, prior to the later of the Closing Date and
the completion of the Initial Purchasers' distribution of the Notes, any
offering material in connection with the offering and sale of the Notes other
than the Offering Memorandum.

         (e)      The Purchase Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding agreement of
the Company, enforceable against the Company in accordance with its terms,
except as rights to indemnification hereunder may be limited by applicable law
and except as the enforcement hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles and except
as rights to indemnification under the Registration Rights Agreement may be
limited by applicable law.

         (f)      The Registration Rights Agreement. At the Closing Date, the
Registration Rights Agreement will be duly authorized, executed and delivered
by, and will be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles and except as rights to indemnification under
the Registration Rights Agreement may be limited by applicable law. Pursuant to
the Registration Rights Agreement, the Company will agree to file with the
Commission, under the circumstances set forth therein, a registration statement
under the Securities Act relating to another series of debt securities of the
Company with terms substantially identical to the Notes (the "Exchange Notes")
to be offered in exchange for the Notes (the "Exchange Offer") and (ii) to the
extent required by the Registration Rights Agreement, a shelf registration
statement pursuant to Rule 415 of the Securities Act relating to the resale by
certain holders of the Notes, and in each case, to use its best efforts to cause
such registration statements to be declared effective.

         (g)      Authorization of the Notes and the Exchange Notes.

                  (i)      The Notes to be purchased by the Initial Purchasers
from the Company will be in the form contemplated by the Indenture, have been
duly authorized for issuance and sale pursuant to this Agreement and at the
Closing Date the Indenture will have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture and delivered against
payment of the purchase price therefor, will constitute valid and binding
agreements of the Company, enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles and will be entitled to the benefits of the Indenture.

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                  (ii)     The Exchange Notes have been duly and validly
authorized for issuance by the Company, and when issued and authenticated in
accordance with the terms of the Indenture, the Registration Rights Agreement
and the Exchange Offer, will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium, or similar laws relating to or affecting enforcement
of the rights and remedies of creditors or by general principles of equity and
will be entitled to the benefits of the Indenture.

         (h)      Authorization of the Indenture. The Indenture has been duly
authorized by the Company, and, at the Closing Date, will have been duly
executed and delivered by the Company, and will, when executed by the Trustee,
constitute a valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors or by general
equitable principles.

         (i)      Description of the Notes and the Indenture. The Notes, the
Exchange Notes and the Indenture will conform in all material respects to the
respective statements relating thereto to be contained in the Offering
Memorandum.

         (j)      No Material Adverse Change. Except as otherwise will be
disclosed in the Offering Memorandum, subsequent to the respective dates as of
which information will be given in the Offering Memorandum: (i) there has been
no material adverse change, or any development that could reasonably be expected
to result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business, operations or prospects, whether or not
arising from transactions in the ordinary course of business, of the Company or
its subsidiaries (any such change is called a "Material Adverse Change"); (ii)
none of the Company or its subsidiaries have incurred any material liability or
obligation, indirect, direct or contingent, not in the ordinary course of
business nor entered into any material transaction or agreement not in the
ordinary course of business; and (iii) there has been no dividend or
distribution of any kind declared, paid or made by the Company or, except for
dividends paid to the Company, its subsidiaries on any class of capital stock or
repurchase or redemption by the Company, or its subsidiaries of any class of
capital stock.

         (k)      Independent Accountants. PricewaterhouseCoopers LLP
("PricewaterhouseCoopers") and KPMG LLP ("KPMG"), who have expressed their
opinion with respect to the financial statements (which term as used in this
Agreement includes the related notes thereto) included in the Offering
Memorandum are independent public or certified public accountants within the
meaning of Regulation S-X under the Securities Act and the Exchange Act.

         (l)      Preparation of the Financial Statements. The financial
statements, together with the related schedules and notes, to be included in the
Offering Memorandum will present fairly the consolidated financial position of
the Company and its subsidiaries as of and at the dates indicated and the
results of their operations and cash flows for the periods specified. Such
financial statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved, except as may be expressly stated in the related notes thereto. The
financial data to be set forth in the Offering Memorandum under the captions
"Offering Memorandum Summary--Summary Historical and Pro Forma Condensed
Consolidated Financial Data" and "Selected Historical Consolidated Financial
Data" fairly present the information set forth therein on a basis consistent
with that of the audited financial statements contained in the Offering
Memorandum. The pro forma

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consolidated, condensed financial statements of the Company and its subsidiaries
and the related notes thereto included under the caption "Offering Memorandum
Summary--Summary Historical and Pro Forma Condensed Consolidated Financial
Data", "Unaudited Pro Forma Consolidated Financial Statements" and elsewhere in
the Offering Memorandum will present fairly the information contained therein,
have been prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements, except that Adjusted EBITDA and
broadcast cash flow are not within the scope of the Commission's guidelines, and
have been properly presented on the bases described therein, and the assumptions
used in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances referred to
therein.

         (m)      Incorporation and Good Standing of the Company and its
Subsidiaries. The Company and its subsidiaries has been duly incorporated or
formed, as applicable, and is validly existing as a corporation or limited
liability company, as the case may be, in good standing under the laws of the
jurisdiction of its incorporation or formation and has corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Offering Memorandum and, in the case of the Company, to
enter into and perform its obligations under each of this Agreement, the
Registration Rights Agreement, the Notes, the Exchange Notes and the Indenture.
The Company and its subsidiaries is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except for such jurisdictions where the
failure to so qualify or to be in good standing would not, individually or in
the aggregate, result in a Material Adverse Change. All of the issued and
outstanding capital stock or LLC interests, as applicable, of the Company and
each subsidiary of the Company has been duly authorized and validly issued, is
fully paid and nonassessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge, lien,
encumbrance or claim. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than the
subsidiaries listed in Schedule II hereto.

         (n)      Capitalization. At December 31, 2002, on a consolidated basis,
after giving pro forma effect to the issuance and sale of the Notes pursuant
hereto, the Company would have an authorized and outstanding capitalization to
be set forth in the Offering Memorandum under the caption "Capitalization"
(other than for subsequent issuances of capital stock, if any, pursuant to
employee benefit plans to be described in the Offering Memorandum or upon
exercise of outstanding options or warrants described in the Offering
Memorandum).

         (o)      Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. The Company, and each of its subsidiaries,
is not in violation of its charter or by-laws or is in default (or, with the
giving of notice or lapse of time, would be in default) ("Default") under any
indenture, mortgage, loan or credit agreement, note, contract, franchise, lease
or other instrument to which the Company or its subsidiaries is a party or by
which it or any of them may be bound (including, without limitation, the
Company's $50.0 million, seven-year revolving credit facility, $130.0 million,
eight-year term loan facility, and Mission's $55.0 million, eight-year term
credit facility and $30.0 million, seven-year revolving credit facility), or to
which any of the property or assets of the Company, and each of its
subsidiaries, is subject (each, an "Existing Instrument"), except for such
Defaults as would not, individually or in the aggregate, result in a Material
Adverse Change. The Company's execution, delivery and performance, as
applicable, of this Agreement, the Registration Rights Agreement and the
Indenture, and the issuance and delivery of the Notes or the Exchange Notes and
consummation of the transactions contemplated hereby and thereby and by the
Offering Memorandum (i) has been duly authorized by all necessary corporate
action and will not result in any violation of the

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provisions of the charter or by-laws or operation agreement, as applicable, of
any of the Company or its subsidiaries, (ii) will not conflict with or
constitute a breach of, or Default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of any
of the Company or its subsidiaries pursuant to, or require the consent of any
other party to, any Existing Instrument, except for such conflicts, breaches,
Defaults, liens, charges or encumbrances as would not, individually or in the
aggregate, result in a Material Adverse Change and (iii) will not result in any
violation of any law, administrative regulation or administrative or court
decree applicable to the Company or any of its subsidiaries. No consent,
approval, authorization or other order of, or registration or filing with, any
court or other governmental or regulatory authority or agency, is required for
the Company's execution, delivery and performance, as applicable, of this
Agreement, the Registration Rights Agreement or the Indenture, or the issuance
and delivery of the Notes or the Exchange Notes or consummation of the
transactions contemplated hereby and thereby and by the Offering Memorandum,
except such as have been obtained or made by the Company and are in full force
and effect under the Securities Act, applicable state securities or blue sky
laws and except such as may be required by federal and state securities laws
with respect to the obligations under the Registration Rights Agreement.

         (p)      No Material Actions or Proceedings. There are no legal or
governmental actions, suits or proceedings pending or, to the best of the
Company's knowledge, threatened against or affecting any of the Company or its
subsidiaries, which has as the subject thereof any property owned or leased by
the Company or any of its subsidiaries, where in any such case there is a
reasonable possibility that such action, suit or proceeding might be determined
adversely to the Company or any such subsidiary and any such action, suit or
proceeding, if so determined adversely, would reasonably be expected to result
in a Material Adverse Change or adversely affect the consummation of the
transactions contemplated by this Agreement. No material labor dispute with the
employees of the Company's or its subsidiaries, exists or, to the best of the
Company's knowledge, is threatened or imminent.

         (q)      Intellectual Property Rights. Except as otherwise disclosed in
the Offering Memorandum, the Company and its subsidiaries, or Mission, own or
possess sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals, trade secrets and other similar rights (collectively, "Intellectual
Property Rights") reasonably necessary to conduct their businesses as now
conducted; and the expected expiration of any of such Intellectual Property
Rights would not result in a Material Adverse Change. None of the Company or any
of its subsidiaries, or Mission, has received any notice of infringement or
conflict with asserted Intellectual Property Rights of others, which
infringement or conflict, if the subject of an unfavorable decision, would
result in a Material Adverse Change.

         (r)      All Necessary Permits, etc. Each of the Company and its
subsidiaries possesses such valid and current certificates, authorizations or
permits issued by the appropriate state, federal or foreign regulatory agencies
or bodies necessary to conduct their respective businesses, and none of the
Company or any of its subsidiaries has received any notice of proceedings
relating to the revocation or modification of, or non-compliance with, any such
certificate, authorization or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could result in a
Material Adverse Change.

         (s)      FCC Licenses.

                  (i)      The Company or its respective subsidiaries, or
Mission, hold such validly issued Federal Communications Commission ("FCC")
licenses and authorizations as are necessary to operate their respective
television stations, which are listed on Schedule III (the

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"Stations"), as they are currently operated (collectively, the "FCC Licenses"),
and each such FCC License is in full force and effect. The FCC Licenses of the
Company or its subsidiaries, or Mission, are listed on Schedule III, and each of
such FCC Licenses has the expiration date indicated on Schedule III.

                  (ii)     The Company has no knowledge of any condition imposed
by the FCC as part of any FCC License, which condition is neither set forth on
the face thereof as issued by the FCC nor contained in the rules and regulations
of the FCC applicable generally to stations of the type, nature, class or
location of the Station in question. Each Station has been and is being operated
in all material respects in accordance with the terms and conditions of the FCC
Licenses applicable to it and the rules and regulations of the FCC and the
Communications Act of 1934, as amended (the "Communications Act").

                  (iii)    No proceedings are pending or are threatened which
may result in the revocation, modification, non-renewal or suspension of any of
the FCC Licenses, the denial of any pending applications, the issuance of any
cease and desist order or the imposition of any fines, forfeitures or other
administrative actions by the FCC with respect to any Station or its operation,
other than any matters which, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Change and proceedings
affecting the television broadcasting industry in general.

                  (iv)     All reports, applications and other documents
required to be filed by the Company and its respective subsidiaries, or Mission,
with the FCC with respect to the Stations have been timely filed, and all such
reports, applications and documents are true, correct and complete in all
respects, except where the failure to make such timely filing or any inaccuracy
therein could not reasonably be expected to result in a Material Adverse Change,
and the Company has no knowledge of any matters that could reasonably be
expected to result in the suspension or revocation of or the refusal to renew
any of the FCC Licenses or the imposition on the Company or any of its
subsidiaries, or Mission, of any material fines or forfeitures by the FCC, or
which could reasonably be expected to result in the revocation, rescission,
reversal or modification of any Station's authorization to operate as currently
authorized under the Communications Act and the policies, rules and regulations
of the FCC.

                  (v)      There are no unsatisfied or otherwise outstanding
citations issued by the FCC with respect to any Station or its operations.

         (t)      Condition of Stations. All of the material properties,
equipment and systems of the Company or its subsidiaries, or Mission, and the
Stations owned and/or operated by them are, and all material properties,
equipment and systems to be added in connection with any contemplated Station
expansion or construction will be, in condition which is sufficient for the
operation thereof in accordance with past practice of the Station in question
and are and will be in compliance with all applicable standards, rules or
requirements imposed by (a) any governmental agency or authority including
without limitation the FCC and (b) any FCC License, in each case except where
such noncompliance could not reasonably be expected to result in a Material
Adverse Change.

         (u)      Title to Properties. The Company and each of its subsidiaries
have good and marketable title to all the properties and assets reflected as
owned in the financial statements referred to in Section 1 above, in each case
free and clear of any security interests, mortgages, liens, encumbrances,
equities, claims and other defects, except such as do not materially and
adversely affect the value of such property and do not materially interfere with
the use made or

                                        7

<PAGE>

proposed to be made of such property by the Company or such subsidiary. The real
property, improvements, equipment and personal property held under lease by the
Company or any of its subsidiaries are held under valid and enforceable leases,
with such exceptions as are not material and do not materially interfere with
the use made or proposed to be made of such real property, improvements,
equipment or personal property by the Company or such subsidiary.

         (v)      Tax Law Compliance. The Company and its consolidated
subsidiaries have filed all necessary federal, state and foreign income and
franchise tax returns and have paid all taxes required to be paid by any of them
and, if due and payable, any related or similar assessment, fine or penalty
levied against any of them. The Company has made adequate charges, accruals and
reserves in the applicable financial statements referred to in Section 1 above
in respect of all federal, state and foreign income and franchise taxes for all
periods as to which the tax liability of the Company and any of its consolidated
subsidiaries has not been finally determined.

         (w)      Company Not an "Investment Company". The Company has been
advised of the rules and requirements under the Investment Company Act of 1940,
as amended (the "Investment Company Act"). No Company is, or after receipt of
payment for the Notes will be, an "investment company" within the meaning of
Investment Company Act, and the Company will conduct its business in a manner so
that it will not become subject to the Investment Company Act.

         (x)      Insurance. Each of the Company and its subsidiaries are
insured by recognized, financially sound institutions with policies in such
amounts and with such deductibles and covering such risks as are generally
deemed adequate and customary for their businesses including, but not limited
to, policies covering real and personal property owned or leased by the Company
and its subsidiaries against theft, damage, destruction, acts of vandalism and
earthquakes. The Company has no reason to believe that it they any of its
subsidiaries will not be able (i) to renew their existing insurance coverage as
and when such policies expire or (ii) to obtain comparable coverage from similar
institutions as may be necessary or appropriate to conduct their business as now
conducted and at a cost that would not result in a Material Adverse Change. None
of the Company or any of its subsidiaries has been denied any insurance coverage
that it has sought or for which it has applied.

         (y)      No Price Stabilization or Manipulation. The Company has not
taken or will not take, directly or indirectly, any action designed to or that
might be reasonably expected to cause or result in stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
the Notes.

         (z)      Company's Accounting System. The Company maintains a system of
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

         (aa)     ERISA Compliance. Except as otherwise will be disclosed in the
Offering Memorandum, the Company, its subsidiaries and any "employee benefit
plan" (as defined under ERISA) established or maintained by the Company or its
subsidiaries or their "ERISA Affiliates" (as defined below) are in compliance in
all material respects with ERISA. "ERISA Affiliate"

                                        8

<PAGE>

means, with respect to the Company or any of its subsidiaries, any member of any
group of organizations described in Section 414 of the Internal Revenue Code of
1986, as amended, and the regulations and published interpretations thereunder
(the "Code") of which the Company or such subsidiary is a member. No "reportable
event" (as defined under ERISA) has occurred or is reasonably expected to occur
with respect to any "employee benefit plan" established or maintained by the
Company or its subsidiaries or any of their ERISA Affiliates. No "employee
benefit plan" established or maintained by the Company, its subsidiaries or any
of their ERISA Affiliates, if such "employee benefit plan" were terminated,
would have any "amount of unfunded benefit liabilities" (as defined under
ERISA). None of the Company, its respective subsidiaries or any of their ERISA
Affiliates have incurred or reasonably expect to incur any liability under Title
IV of ERISA with respect to termination of, or withdrawal from, any "employee
benefit plan" or (ii) Sections 412, 4971, 4975 or 4980B of the Code. Each
"employee benefit plan" established or maintained by the Company, its respective
subsidiaries or any of their ERISA Affiliates that is intended to be qualified
under Section 401 of the Code is so qualified and nothing has occurred, whether
by action or failure to act, which would cause the loss of such qualification.

         (bb)     Regulation S. The Company and its Affiliates and all persons
acting on their behalf (other than the Initial Purchasers, as to whom the
Company makes no representation) have complied with and will comply with the
offering restrictions requirements of Regulation S in connection with the
offering of the Notes outside the United States and, in connection therewith,
the Offering Memorandum will contain the disclosure required by Rule 902. The
Company is a "reporting issuer", as defined in Rule 902 under the Securities
Act.

                  Any certificate signed by an officer of the Company and
delivered to the Initial Purchasers or to counsel for the Initial Purchasers
shall be deemed to be a representation and warranty by the Company to the
Initial Purchasers as to the matters set forth therein.

SECTION 2.        PURCHASE, SALE AND DELIVERY OF THE NOTES.

         (a)      The Notes. The Company agrees to issue and sell to the several
Initial Purchasers, severally and not jointly, all of the Notes upon the terms
herein set forth. On the basis of the representations, warranties and agreements
herein contained, and upon the terms but subject to the conditions herein set
forth, the Initial Purchasers agrees, to purchase from the Company the number of
Notes set forth opposite their names on Schedule I, at a purchase price equal to
57.442% of the principal amount thereof payable on the Closing Date.

         (b)      The Closing Date. Delivery of certificates for the Notes in
definitive form to be purchased by the Initial Purchasers and payment therefor
shall be made at the offices of Latham & Watkins, 885 Third Avenue, New York,
New York (or such other place as may be agreed to by the Company and the Initial
Purchaser) at 9:00 a.m. New York City time, on March 27, 2003 or such other time
and date as the Initial Purchasers shall designate by notice to the Company (the
time and date of such closing are called the "Closing Date"). The Company hereby
acknowledges that circumstances under which the Initial Purchasers may provide
notice to postpone the Closing Date as originally scheduled include, but are in
no way limited to, any determination by the Company or the Initial Purchasers to
recirculate to investors copies of an amended or supplemented Offering
Memorandum or a delay as contemplated by the provisions of Section 16.

                                        9

<PAGE>

         (c)      Delivery of the Notes. The Company shall deliver, or cause to
be delivered, to the Initial Purchaser certificates for the Notes on the Closing
Date against the irrevocable release of a wire transfer of immediately available
funds for the amount of the purchase price therefor. The certificates for the
Notes shall be in such denominations and registered in the name of Cede & Co.,
as nominee of the Depository, and shall be made available for inspection on the
business day preceding the Closing Date at a location in New York City, as the
Initial Purchaser may designate. Time shall be of the essence, and delivery at
the time and place specified in this Agreement is a further condition to the
obligations of the Initial Purchaser.

         (d)      Delivery of Offering Memorandum to the Initial Purchasers.

                  (i)      Not later than 12:00 noon on Thursday, March 27,
2003, the Company shall deliver or cause to be delivered copies of the Offering
Memorandum in such quantities and at such places as the Initial Purchasers shall
reasonably request. Such Offering Memorandum shall be in form and substance
reasonably acceptable to the Initial Purchasers.

                  (ii)     By the Closing Date, the Company shall include in the
Offering Memorandum (i) with the financial and other data set forth under the
caption "Management's Discussion and Analysis of Financial Condition and Results
of Operations" a discussion of the financial condition, changes in financial
position and results of operation of the Company and its subsidiaries based on
the audited consolidated financial statements of the Company for the year ended
December 31, 2002 consistent with past practice of the Company and in compliance
with Item 303 of Regulation S-K under the Securities Act; (ii) the audited
consolidated financial statements of the Company for the year ended December 31,
2002; (iii) the audited financial statements of United Broadcasting Corporation
and Morris Network of Alabama, Inc. (the "Morris Group") for the year ended
September 30, 2002; and (iv) pro forma financial information computed on a basis
consistent with the audited historical consolidated financial statements of the
Company, prepared using reasonable assumptions and containing such appropriate
adjustments to give effect to the transactions or circumstances referred to
therein and in form and substance reasonably acceptable to the Initial
Purchasers.

                  (iii)    The Company will as soon as possible after the date
hereof inform the Initial Purchasers (i) if PricewaterhouseCoopers informs
either of them of any matters that may give rise to a qualification or
modification to its audit report for consolidated financial statement of the
Company for the year ended December 31, 2002; or (ii) if PricewaterhouseCoopers
informs either of them that PricewaterhouseCoopers is not or may not be in a
position to issue an unqualified or unmodified audit opinion for consolidated
financial statement of the Company for the year ended December 31, 2002.

                  (iv)     On the Closing Date, the Initial Purchaser shall have
received a copy, certified a true copy by an officer of the Company, of the
audited consolidated financial statements of the Company for the year ended
December 31, 2002 containing an audit opinion of PricewaterhouseCoopers, without
qualification, stating that such financial statements present fairly, in all
material respects, the financial position of the Company and its subsidiaries
and were produced in conformity with accounting principles generally acceptable
in the United States of America.

         (e)      Initial Purchaser as Qualified Purchaser. Each Initial
Purchaser, severally and not jointly, represents and warrants to, and agrees
with, the Company that it is a Qualified

                                       10

<PAGE>

Institutional Buyer within the meaning of Rule 144A ("Qualified Institutional
Buyer") and an "accredited investor" within the meaning of Rule 501 under the
Securities Act.

         (f)      Resale of Notes. Each Initial Purchaser severally and not
jointly represents and warrants to, and agrees with the Company that such
Initial Purchaser will make offers of the Notes purchased hereunder on the terms
set forth in the Offering Memorandum solely to (i) persons whom such Initial
Purchaser reasonably believes to be Qualified Institutional Buyers, and (ii)
persons permitted to purchase the Notes in offshore transactions in reliance
upon Regulation S under the Securities Act (such persons specified in clauses
(i) and (ii) are the Subsequent Purchasers referred to herein).

SECTION 3.        Additional Covenants. The Company further covenants and agrees
with the Initial Purchasers as follows:

         (a)      Initial Purchasers' Review of Proposed Amendments and
Supplements. Prior to amending or supplementing the Offering Memorandum, the
Company shall furnish to the Initial Purchasers for review a copy of each such
proposed amendment or supplement, and the Company shall not use any such
proposed amendment or supplement to which the Initial Purchasers reasonably
object.

         (b)      Amendments and Supplements to the Offering Memorandum and
Other Securities Act Matters. If, prior to the completion of the placement of
the Notes by the Initial Purchasers with the Subsequent Purchasers, any event
shall occur or condition exist as a result of which it is necessary to amend or
supplement the Offering Memorandum in order to make the statements therein, in
the light of the circumstances when the Offering Memorandum is delivered to a
purchaser, not misleading, or if in the opinion of the Initial Purchasers or
counsel for the Initial Purchasers it is otherwise necessary to amend or
supplement the Offering Memorandum to comply with law, the Company agrees to
promptly prepare (subject to Section 3 hereof), and furnish at its own expense
to the Initial Purchasers, amendments or supplements to the Offering Memorandum
so that the statements in the Offering Memorandum as so amended or supplemented
will not, in the light of the circumstances when the Offering Memorandum is
delivered to a purchaser, be misleading or so that the Offering Memorandum, as
amended or supplemented, will comply with law.

                  Following the consummation of the Exchange Offer or the
effectiveness of an applicable shelf registration statement and for so long as
the Notes are outstanding if, in the reasonable judgment of the Initial
Purchasers, the Initial Purchasers or any of its affiliates (as such term is
defined in the rules and regulations under the Securities Act) are required to
deliver a prospectus in connection with sales of, or market-making activities
with respect to, such securities, to periodically amend the applicable
registration statement so that the information contained therein complies with
the requirements of Section 10 of the Securities Act, to amend the applicable
registration statement or supplement the related prospectus or the documents
incorporated therein when necessary to reflect any material changes in the
information provided therein so that the registration statement and the
prospectus will not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances existing as of the date the prospectus is so
delivered, not misleading and to provide the Initial Purchasers with copies of
each amendment or supplement filed and the information required to be provided
to the Trustee pursuant to the Indenture.

                  The Company hereby expressly acknowledges that the
indemnification and contribution provisions of Sections 8 and 9 hereof are
specifically applicable and relate to each

                                       11

<PAGE>

offering memorandum, registration statement, prospectus, amendment or supplement
referred to in this Section 3.

         (c)      Copies of the Offering Memorandum. The Company agrees to
furnish the Initial Purchasers, without charge, as many copies of the Offering
Memorandum and any amendments and supplements thereto as it shall have
reasonably requested.

         (d)      Blue Sky Compliance. The Company shall cooperate with the
Initial Purchasers and counsel for the Initial Purchasers to qualify or register
the Notes for sale under (or obtain exemptions from the application of) the Blue
Sky or state securities laws of those jurisdictions designated by the Initial
Purchasers, shall comply with such laws and shall continue such qualifications,
registrations and exemptions in effect so long as required for the distribution
of the Notes. The Company shall not be required to qualify as a foreign
corporation or to take any action that would subject it to general service of
process in any such jurisdiction where it is not presently qualified or where it
would be subject to taxation as a foreign corporation. The Company will advise
the Initial Purchasers promptly of the suspension of the qualification or
registration of (or any such exemption relating to) the Notes for offering, sale
or trading in any jurisdiction or any initiation or threat of any proceeding for
any such purpose, and in the event of the issuance of any order suspending such
qualification, registration or exemption, the Company shall use its best efforts
to obtain the withdrawal thereof at the earliest possible moment.

         (e)      Use of Proceeds. The Company shall apply the net proceeds from
the sale of the Notes sold by it in the manner to be described under the caption
"Use of Proceeds" in the Offering Memorandum.

         (f)      The Depositary. The Company will cooperate with the Initial
Purchasers and use its best efforts to permit the Notes to be eligible for
clearance and settlement through the facilities of the Depositary.

         (g)      Additional Issuer Information. Additionally, at any time when
the Company is not subject to Section 13 or 15 of the Exchange Act, for the
benefit of holders and beneficial owners from time to time of Notes, the Company
shall furnish, at its expense, upon request, to holders and beneficial owners of
Notes and prospective purchasers of Notes information ("Additional Issuer
Information") satisfying the requirements of subsection of Rule 144A.

         (h)      Future Reports to the Initial Purchasers. For so long as any
Exchange Notes remain outstanding, the Company will furnish to Banc of America
Securities LLC (i) as soon as practicable after the end of each fiscal year,
copies of the Annual Report of the Company containing the balance sheet of the
Company as of the close of such fiscal year and statements of income,
stockholders' equity (or member's equity, as applicable) and cash flows for the
year then ended and the opinion thereon of the Company's independent public or
certified public accountants; (ii) as soon as practicable after the filing
thereof, copies of each proxy statement, Annual Report on Form 10-K, Quarterly
Report on Form 10-Q, Current Report on Form 8-K or other report filed by the
Company with the Commission, the NASD or any securities exchange; and (iii) as
soon as available, copies of any report or communication the Company mailed
generally to holders of its capital equity or debt securities (including the
holders of the Notes).

         (i)      No Integration. The Company agrees that it will not and will
cause its Affiliates not to make any offer or sale of securities of the Company
of any class if, as a result of the doctrine of "integration" referred to in
Rule 502 under the Securities Act, such offer or sale would render invalid (for
the purpose of the sale of the Notes by the Company to the Initial Purchaser,
(i) the resale of the Notes by the Initial Purchasers to Subsequent Purchasers
or (ii) the resale of the

                                       12

<PAGE>

Notes by such Subsequent Purchasers to others) the exemption from the
registration requirements of the Securities Act provided by Section 4 thereof or
by Rule 144A thereunder or otherwise.

         (j)      Legended Notes. Each certificate for a Notes, Note or Common
Share will bear the respective legend to be contained in "Notice to Investors"
in the Offering Memorandum for the time period and upon the other terms stated
in the Offering Memorandum.

         (k)      PORTAL. The Company will use its best efforts to cause such
Notes to be eligible for the National Association of Securities Dealers, Inc.
PORTAL market (the "PORTAL market").

                  Banc of America Securities LLC, on behalf of the several
Initial Purchasers, may, in its sole discretion, waive in writing the
performance by the Company of any one or more of the foregoing covenants or
extend the time for their performance.

SECTION 4.        Payment of Expenses. The Company agrees to pay all costs, fees
and expenses incurred in connection with the performance of their obligations
hereunder and in connection with the transactions contemplated hereby,
including, without limitation, all expenses incident to the issuance and
delivery of the Notes (including all printing and engraving costs), (ii) all
necessary issue, transfer and other stamp taxes in connection with the issuance
and sale of the Notes to the Initial Purchaser, (iii) all fees and expenses of
the Companys' counsel, independent public or certified public accountants and
other advisors, (iv) all costs and expenses incurred in connection with the
preparation, printing, filing, shipping and distribution of the Offering
Memorandum (including financial statements and exhibits), and all amendments and
supplements thereto, this Agreement, the Registration Rights Agreement, the
Indenture and the Notes, all filing fees, attorneys' fees and expenses incurred
by the Company or the Initial Purchasers in connection with qualifying or
registering (or obtaining exemptions from the qualification or registration of)
all or any part of the Notes for offer and sale under the Blue Sky laws and, if
requested by the Initial Purchasers, preparing and printing a "Blue Sky Survey"
or memorandum, and any supplements thereto, advising the Initial Purchasers of
such qualifications, registrations and exemptions, (vi) the fees and expenses of
the Trustee, including the fees and disbursements of counsel for the Trustee in
connection with the Indenture, the Notes and the Exchange Notes, (vii) any fees
payable in connection with the rating of the Notes or the Exchange Notes with
the ratings agencies and the listing of the Notes with the PORTAL market, (viii)
any filing fees incident to the review by the National Association of Securities
Dealers, Inc., if any, of the terms of the sale of the Notes or the Exchange
Notes, (ix) all fees and expenses (including reasonable fees and expenses of
counsel) of the Company in connection with approval of the Notes by the
Depositary for "book-entry" transfer, and the performance by the Company of its
obligations under this Agreement. Except as provided in this Section 4, Section
6, Section 8 and Section 9 hereof, the Initial Purchasers shall pay their own
expenses, including the fees and disbursements of their counsel.

SECTION 5.        Conditions of the Obligations of the Initial Purchasers. The
obligations of the Initial Purchasers to purchase and pay for the Notes as
provided herein on the Closing Date shall be subject to the accuracy of the
representations and warranties on the part of the Company set forth in Section 1
hereof as of the date hereof and as of the Closing Date as though then made and
to the timely performance by the Company of its covenants and other obligations
hereunder, and to each of the following additional conditions:

         (a)      Accountants' Comfort Letter. On the Closing Date, the Initial
Purchasers shall have received from each of PricewaterhouseCoopers, independent
public or certified public accountants for the Company, and KPMG, independent
public or certified public auditors with

                                       13

<PAGE>

respect to the Morris Group, a letter dated such date addressed to the Initial
Purchasers, in form and substance reasonably satisfactory to the Initial
Purchasers, containing statements and information of the type ordinarily
included in accountant's "comfort letters" to the Initial Purchasers, delivered
according to Statement of Auditing Standards Nos. 72 and 76 (or any successor
bulletins), with respect to the audited and unaudited financial statements and
certain financial information contained in the Offering Memorandum.

         (b)      No Material Adverse Change or Ratings Agency Change. For the
period from and after the date of this Agreement and prior to the Closing Date:

                  (i)      in the reasonable judgment of the Initial Purchasers
                  there shall not have occurred any Material Adverse Change; and

                  (ii)     there shall not have occurred any downgrading, nor
                  shall any notice have been given of any intended or potential
                  downgrading or of any review for a possible change that does
                  not indicate the direction of the possible change, in the
                  rating accorded any securities of any of the Company or its
                  subsidiaries by any "nationally recognized statistical rating
                  organization" as such term is defined for purposes of Rule 436
                  under the Securities Act.

         (c)      Financial Information. The preliminary financial statements
provided by the Company to the Initial Purchasers on the date hereof together
with the related schedules and notes, shall not be materially different, in the
reasonable judgment of the Initial Purchasers, from the financial statements,
together with the related schedules and notes, included in the Offering
Memorandum, as of its date.

         (d)      Opinion of Counsel for the Company. On the Closing Date, the
Initial Purchasers shall have received the favorable opinion of Kirkland &
Ellis, counsel for the Company, dated as of such Closing Date, the form of which
is attached as Exhibit A.

         (e)      Opinion of Regulatory Counsel for the Company . On the Closing
Date, the Initial Purchasers shall have received the favorable opinions of
Drinker Biddle & Reath LLP, special regulatory counsel for the Company, dated as
of such Closing Date, substantially in the form attached as Exhibit B.

         (f)      Opinion of Counsel for the Initial Purchasers. On the Closing
Date the Initial Purchasers shall have received the favorable opinion of Latham
& Watkins, counsel for the Initial Purchasers, dated as of such Closing Date,
with respect to such matters as may be reasonably requested by the Initial
Purchasers.

         (g)      Officers' Certificate. On the Closing Date the Initial
Purchasers shall have received a written certificate executed by the Chairman of
the Board, Chief Executive Officer or President and the Chief Financial Officer
or Chief Accounting Officer of the Company, dated as of the Closing Date, to the
effect set forth in subsection (b) (ii) of this Section 5, and further to the
effect that:

                  (i)      for the period from and after the date of this
                  Agreement and prior to the Closing Date there has not occurred
                  any Material Adverse Change;

                  (ii)     the representations and warranties of the Company set
                  forth in Section 1 of this Agreement are true and correct with
                  the same force and

                                       14

<PAGE>

                  effect as though expressly made on and as of the Closing Date;
                  and

                  (iii)    the Company has complied with all the agreements and
                  satisfied all the conditions on its part to be performed or
                  satisfied at or prior to the Closing Date.

         (h)      PORTAL Listing. At the Closing Date the Notes shall have been
designated for trading on the PORTAL market.

         (i)      Registration Rights Agreement. The Company shall have entered
into the Registration Rights Agreement, and the Initial Purchasers shall have
received executed counterparts thereof.

         (j)      Indenture. The Company, Mission and the Trustee shall have
entered into the Indenture, and the Initial Purchasers shall have received an
executed copy thereof.

         (k)      Additional Documents. On or before the Closing Date, the
Initial Purchasers and counsel for the Initial Purchasers shall have received
such information, documents and opinions as they may reasonably require for the
purposes of enabling them to pass upon the issuance and sale of the Notes as
contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained.

                  If any condition specified in this Section 5 is not satisfied
when and as required to be satisfied, this Agreement may be terminated by the
Initial Purchasers by notice to the Company at any time on or prior to the
Closing Date, which termination shall be without liability on the part of any
party to any other party, except that Section 4, Section 6, Section 8 and
Section 9 shall at all times be effective and shall survive such termination.

SECTION 6.        Reimbursement of Initial Purchasers' Expenses. If this
Agreement is terminated by the Initial Purchasers pursuant to Section 5, or if
the sale to the Initial Purchasers of the Notes on the Closing Date is not
consummated because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or to comply with any provision hereof,
the Company agrees to reimburse the Initial Purchasers (or such Initial
Purchasers as have terminated this Agreement with respect to themselves),
severally, upon demand for all out-of-pocket expenses that shall have been
reasonably incurred by the Initial Purchasers in connection with the proposed
purchase and the offering and sale of the Notes, including but not limited to
fees and disbursements of counsel, printing expenses, travel expenses, postage,
facsimile and telephone charges.

SECTION 7.        Offer, Sale and Resale Procedures. Each of the Initial
Purchasers, on the one hand, and the Company, on the other hand, hereby
establish and agree to observe the following procedures in connection with the
offer and sale of the Notes:

                  (i)      Offers and sales of the Notes will be made only by
the Initial Purchasers or Affiliates thereof qualified to do so in the
jurisdictions in which such offers or sales are made. Each such offer or sale
shall only be made to persons whom the offeror or seller reasonably believes to
be Qualified Institutional Buyers or non-U.S. persons outside the United States
to whom the offeror or seller reasonably believes offers and sales of the Notes
may be made in

                                       15

<PAGE>

reliance upon Regulation S under the Securities Act, upon the terms and
conditions set forth in Annex I hereto, which Annex I is hereby expressly made a
part hereof.

                  (ii)     The Notes will be offered by approaching prospective
Subsequent Purchasers on an individual basis. No general solicitation or general
advertising (within the meaning of Rule 502 under the Securities Act) will be
used in the United States in connection with the offering of the Notes.

                  (iii)    Upon original issuance by the Company, and until such
time as the same is no longer required under the applicable requirements of the
Securities Act, the Notes (and all securities issued in exchange therefor or in
substitution thereof, other than the Exchange Notes) shall bear the following
legend:

"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) (a) TO A PERSON WHO IS
A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR RULE 904 UNDER THE SECURITIES ACT, (d) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) OF THE SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED INVESTOR")) THAT, PRIOR
TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF
NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUE THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, OR (e) IN ACCORDANCE
WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
(AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (ii) TO THE
COMPANY, OR (iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE
SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE."

                  Following the sale of the Notes by the Initial Purchasers to
Subsequent Purchasers pursuant to the terms hereof, the Initial Purchasers shall
not be liable or responsible to the Company for any losses, damages or
liabilities suffered or incurred by the Company, including any losses, damages
or liabilities under the Securities Act, arising from or relating to any resale
or transfer of any Security by non-Affiliates of the Initial Purchasers.

                                       16

<PAGE>

SECTION 8.        INDEMNIFICATION.

         (a)      Indemnification of the Initial Purchaser. The Company agrees
to indemnify and hold harmless the Initial Purchaser, its directors, officers
and employees, and each person, if any, who controls each Initial Purchaser
within the meaning of the Securities Act and the Exchange Act against any loss,
claim, damage, liability or expense, as incurred, to which the Initial Purchaser
or such controlling person may become subject, under the Securities Act, the
Exchange Act or other federal or state statutory law or regulation, or at common
law or otherwise (including in settlement of any litigation, if such settlement
is effected with the written consent of the Company), insofar as such loss,
claim, damage, liability or expense (or actions in respect thereof as
contemplated below) arises out of or is based (i) upon any untrue statement or
alleged untrue statement of a material fact contained in the Offering Memorandum
(or any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading; or
(ii) in whole or in part upon any failure of the Company to perform its
obligations hereunder or under law; or (iii) any act or failure to act or any
alleged act or failure to act by such Initial Purchaser in connection with, or
relating in any manner to, the offering contemplated hereby, and which is
included as part of or referred to in any loss, claim, damage, liability or
action arising out of or based upon any matter covered by clause above; provided
that the Company shall not be liable under this clause (iii) to the extent that
a court of competent jurisdiction shall have determined by a final judgment that
such loss, claim, damage, liability or action resulted directly from any such
acts or failures to act undertaken or omitted to be taken by such Initial
Purchaser through its gross negligence or willful misconduct; and to reimburse
each Initial Purchaser and each such controlling person for reasonable expenses
(including the reasonable fees and disbursements of counsel chosen by Banc of
America Securities LLC) as such expenses are reasonably incurred by such Initial
Purchaser or such controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action; provided, however, that the foregoing indemnity
agreement shall not apply to any loss, claim, damage, liability or expense to
the extent, but only to the extent, arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the
Company by the Initial Purchasers for use in the Offering Memorandum (or any
amendment or supplement thereto). The indemnity agreement set forth in this
Section 8 shall be in addition to any liabilities that the Company may otherwise
have.

         (b)      Indemnification of the Company, its Directors and Officers.
Each Initial Purchaser agrees, severally and not jointly, to indemnify and hold
harmless the Company and each of its respective directors and each person, if
any, who controls the Company within the meaning of the Securities Act or the
Exchange Act, against any loss, claim, damage, liability or expense, as
incurred, to which the Company or any such director, or controlling person may
become subject, under the Securities Act, the Exchange Act, or other federal or
state statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Initial Purchaser), insofar as such loss, claim, damage,
liability or expense (or actions in respect thereof as contemplated below)
arises out of or is based upon any untrue or alleged untrue statement of a
material fact contained in the Offering Memorandum (or any amendment or
supplement thereto), or arises out of or is based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Offering Memorandum
(or any amendment or supplement thereto), in reliance upon and in conformity
with written information furnished to the Company by the Initial Purchasers
expressly for use therein; and to reimburse any the Company or any such

                                       17

<PAGE>

director or controlling person for any legal and other expenses reasonably
incurred by the Company or any such director or controlling person in connection
with investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action. The Company hereby acknowledges
that the only information that the Initial Purchasers have furnished to the
Company expressly for use in the Offering Memorandum (or any amendment or
supplement thereto) are the statements referenced on Schedule IV, which Schedule
IV shall be attached to this Agreement on the date of the Offering Memorandum
and shall be part of this Agreement as if attached to this Agreement on the date
hereof); and each Initial Purchaser confirms that such statements are correct.
The indemnity agreement set forth in this Section 8 shall be in addition to any
liabilities that each Initial Purchaser may otherwise have.

         (c)      Notifications and Other Indemnification Procedures. Promptly
after receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section 8, notify
the indemnifying party in writing of the commencement thereof, but the omission
so to notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party for contribution or otherwise than under
the indemnity agreement contained in this Section 8 or to the extent it is not
prejudiced as a proximate result of such failure. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party; provided, however, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there
may be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of such indemnifying
party's election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless the indemnified party shall have employed separate counsel in
accordance with the proviso to the next preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel (together with local counsel), approved by the
indemnifying party (Banc of America Securities LLC in the case of Section 8 and
Section 9), representing the indemnified parties who are parties to such action)
or (ii) the indemnifying party shall not have employed counsel satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of commencement of the action, in each of which cases the fees
and expenses of counsel shall be at the expense of the indemnifying party.

         (d)      Settlements. The indemnifying party under this Section 8 shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by Section 8
hereof, the indemnifying party agrees that (i) it

                                       18

<PAGE>

shall be liable for any settlement of any proceeding effected without its
written consent if such settlement is entered into more than 30 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or
consent includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such action, suit or
proceeding.

SECTION 9.        CONTRIBUTION.

                  If the indemnification provided for in Section 8 is for any
reason held to be unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount paid or payable by such indemnified party, as incurred, as
a result of any losses, claims, damages, liabilities or expenses referred to
therein in such proportion as is appropriate to reflect the relative benefits
received by the Company, on the one hand, and the Initial Purchasers, on the
other hand, from the offering of the Notes pursuant to this Agreement or (ii) if
the allocation provided by clause above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause above but also the relative fault of the Company, on the
one hand, and the Initial Purchasers, on the other hand, in connection with the
statements or omissions or inaccuracies in the representations and warranties
herein which resulted in such losses, claims, damages, liabilities or expenses,
as well as any other relevant equitable considerations. The relative benefits
received by the Company, on the one hand, and the Initial Purchasers, on the
other hand, in connection with the offering of the Notes pursuant to this
Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Notes pursuant to this Agreement (before
deducting expenses) received by the Company, and the total discount received by
the Initial Purchasers bear to the aggregate initial offering price of the
Notes. The relative fault of the Company, on the one hand, and the Initial
Purchasers, on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact or any such inaccurate
or alleged inaccurate representation or warranty relates to information supplied
by the Company, on the one hand, or the Initial Purchasers, on the other hand,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.

                  The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Section 8, any legal
or other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8 with respect to notice of commencement of any action shall apply if a
claim for contribution is to be made under this Section 9; provided, however,
that no additional notice shall be required with respect to any action for which
notice has been given under Section 8 for purposes of indemnification.

                  The Company and the Initial Purchasers agree that it would not
be just and equitable if contribution pursuant to this Section 9 were determined
by pro rata allocation (even if the Initial Purchasers were treated as one
entity for such purpose) or by any other method of

                                       19

<PAGE>

allocation which does not take account of the equitable considerations referred
to in this Section 9.

                  Notwithstanding the provisions of this Section 9, the Initial
Purchaser shall not be required to contribute any amount in excess of the
discount received by the Initial Purchaser in connection with the Notes
distributed by it. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11 of the Securities Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation. The
Initial Purchasers' obligations to contribute pursuant to this Section 9 are
several, and not joint, in proportion to their respective commitments as set
forth opposite their names on Schedule I. For purposes of this Section 9, each
director, officer and employee of the Initial Purchaser and each person, if any,
who controls an Initial Purchaser within the meaning of the Securities Act and
the Exchange Act shall have the same rights to contribution as such Initial
Purchaser, and each director of the Company, and each person, if any, who
controls the Company with the meaning of the Securities Act and the Exchange Act
shall have the same rights to contribution as the Company.

SECTION 10.       Termination of this Agreement. Prior to the Closing Date, this
Agreement may be terminated by the Initial Purchasers by notice given to the
Company if at any time (i) trading in securities generally on either the Nasdaq
Stock Market or the New York Stock Exchange shall have been suspended or limited
or minimum or maximum prices shall have been generally established on any such
stock exchanges by the Commission or the NASD; (ii) a general banking moratorium
shall have been declared by any of federal, New York, Delaware or California
authorities; (iii) there shall have occurred any attack on or act of terrorism
involving the United States, any declaration of war on or by the United States,
outbreak or any escalation of national or international hostilities or any
crisis or calamity, or any change in the United States or international
financial markets, or any substantial change or development involving a
prospective substantial change in United States' or international political,
financial or economic conditions, as in the reasonable judgment of the Initial
Purchasers is material and adverse and makes it impracticable to market the
Notes in the manner and on the terms described in the Offering Memorandum or to
enforce contracts for the sale of securities; (iv) in the reasonable judgment of
the Initial Purchasers there shall have occurred any Material Adverse Change; or
the Company or its subsidiaries shall have sustained a loss by strike, fire,
flood, earthquake, accident or other calamity of such character as in the
reasonable judgment of the Initial Purchasers may interfere materially with the
conduct of the business and operations of the Company or its subsidiaries
regardless of whether or not such loss shall have been insured. Any termination
pursuant to this Section 10 shall be without liability on the part of (A) the
Company to any Initial Purchaser, except that the Company shall be obligated to
reimburse the expenses of the Initial Purchasers pursuant to Section 4 and, in
the case of clause (iv) above, Section 6 hereof, (B) any Initial Purchaser to
the Company, or (c) any party hereto to any other party except that the
provisions of Section 8 and Section 9 shall at all times be effective and shall
survive such termination.

SECTION 11.       Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, of its officers and of the several Initial Purchasers
set forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Initial
Purchaser, the Company or any of its partners, officers or directors or any
controlling person, as the case may be, and will survive delivery of and payment
for the Notes sold hereunder and any termination of this Agreement.

SECTION 12.       Notices. All communications hereunder shall be in writing and
shall be mailed, hand delivered or telecopied and confirmed to the parties
hereto as follows:

                                       20

<PAGE>

If to the Initial Purchasers:

         Banc of America Securities LLC
         9 West 57th Street, 31st Floor
         New York, NY 10019
         Facsimile: 1212-583-8324
         Attention: High Yield Capital Markets

   with a copy to:

         Latham & Watkins
         885 Third Avenue, Suite 1000
         New York, NY 10022
         Facsimile:  1212-751-4864
         Attention:  Gregory Ezring, Esq.

If to the Company:

         Nexstar Finance, L.L.C.
         909 Lake Carolyn Parkway, Suite 1450
         Irving, Texas 75039
         Facsimile:  1972 373 8888
         Attention:  Shirley Green

with a copy to:

         Kirkland & Ellis
         153 East 53rd Street
         New York, NY  10022
         Facsimile:  1212 446-4900
         Attention:  Joshua N. Korff, Esq.

Any party hereto may change the address for receipt of communications by giving
written notice to the others.

SECTION 13.       Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto, including any substitute Initial Purchasers
pursuant to Section 16 hereof, and to the benefit of the employees, officers and
directors and controlling persons referred to in Section 8 and Section 9, and in
each case their respective successors, and no other person will have any right
or obligation hereunder. The term "successors" shall not include any purchaser
of the Notes as such from the Initial Purchasers merely by reason of such
purchase.

SECTION 14.       Partial Unenforceability. The invalidity or unenforceability
of any Section, paragraph or provision of this Agreement shall not affect the
validity or enforceability of any other Section, paragraph or provision hereof.
If any Section, paragraph or provision of this Agreement is for any reason
determined to be invalid or unenforceable, there shall be deemed to be made such
minor changes (and only such minor changes) as are necessary to make it valid
and enforceable.

                                       21

<PAGE>

SECTION 15.       Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.

SECTION 16.       Consent to Jurisdiction. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby ("Related Proceedings") may be instituted in the federal courts of the
United States of America located in the City and County of New York or the
courts of the State of New York in each case located in the City and County of
New York (collectively, the "Specified Courts"), and each party irrevocably
submits to the non-exclusive jurisdiction (except for proceedings instituted in
regard to the enforcement of a judgment of any such court (a "Related
Judgment"), as to which such jurisdiction is non-exclusive) of such courts in
any such suit, action or proceeding. Service of any process, summons, notice or
document by mail to such party's address set forth above shall be effective
service of process for any suit, action or other proceeding brought in any such
court. The parties irrevocably and unconditionally waive any objection to the
laying of venue of any suit, action or other proceeding in the Specified Courts
and irrevocably and unconditionally waive and agree not to plead or claim in any
such court that any such suit, action or other proceeding brought in any such
court has been brought in an inconvenient forum.

SECTION 17.       Default of One or More of the Several Initial Purchasers. If
any one or more of the several Initial Purchasers shall fail or refuse to
purchase Notes that it or they have agreed to purchase hereunder on the Closing
Date, and the aggregate number of Notes that such defaulting Initial Purchaser
or Initial Purchasers agreed but failed or refused to purchase does not exceed
10% of the aggregate number of the Notes to be purchased on such date, the other
Initial Purchasers shall be obligated, severally, in the proportions that the
number of Notes set forth opposite their respective names on Schedule I bears to
the aggregate number of Notes set forth opposite the names of all such
non-defaulting Initial Purchasers, or in such other proportions as may be
specified by the Initial Purchasers with the consent of the non-defaulting
Initial Purchasers, to purchase the Notes that such defaulting Initial Purchaser
or Initial Purchasers agreed but failed or refused to purchase on such date. If
any one or more of the Initial Purchasers shall fail or refuse to purchase Notes
and the aggregate number of Notes with respect to which such default occurs
exceeds 10% of the aggregate number of Notes to be purchased on the Closing
Date, and arrangements satisfactory to the Initial Purchasers and the Company
for the purchase of such Notes are not made within 48 hours after such default,
this Agreement shall terminate without liability of any party to any other party
except that the provisions of Section 4, Section 8 and Section 9 shall at all
times be effective and shall survive such termination. In any such case, either
the Initial Purchasers or the Company shall have the right to postpone the
Closing Date, as the case may be, but in no event for longer than seven days in
order that the required changes, if any, to the Offering Memorandum or any other
documents or arrangements may be effected.

                  As used in this Agreement, the term "Initial Purchaser" shall
be deemed to include any person substituted for a defaulting Initial Purchaser
under this Section 10. Any action taken under this Section 16 shall not relieve
any defaulting Initial Purchaser from liability in respect of any default of
such Initial Purchaser under this Agreement.

SECTION 18.       General Provisions. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be executed in two
or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This

                                       22

<PAGE>

Agreement may not be amended or modified unless in writing by all of the parties
hereto, and no condition herein (express or implied) may be waived unless waived
in writing by each party whom the condition is meant to benefit. The Table of
Contents and the section headings herein are for the convenience of the parties
only and shall not affect the construction or interpretation of this Agreement.

                                       23

<PAGE>

                  If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to the Company the enclosed copies hereof,
whereupon this instrument, along with all counterparts hereof, shall become a
binding agreement in accordance with its terms.

                                       Very truly yours,

                                       NEXSTAR FINANCE HOLDINGS, L.L.C.
                                       NEXSTAR FINANCE HOLDINGS, INC.

                                       By: _____________________________________
                                           Name: Perry A. Sook
                                           Title: President

<PAGE>

                  The foregoing Purchase Agreement is hereby confirmed and
accepted by the Initial Purchasers as of the date first above written.

BY:  BANC OF AMERICA SECURITIES LLC
       BEAR STEARNS & CO. INC.

By: _________________________________
     Name:  Daniel J. Kelly
     Title:  Managing Director

<PAGE>

                                   SCHEDULE I

                                                            Number of Securities
Initial Purchaser                                             to be Purchased

Banc of America Securities LLC ........................            65,000
Bear Stearns & Co. Inc.................................            65,000

         Total.........................................           130,000

                                       I-1

<PAGE>

                                   SCHEDULE II
                                  Subsidiaries

Nexstar Finance, L.L.C.
Nexstar Finance, Inc.
Entertainment Realty Corporation
Nexstar Alabama Acquisition, Inc.
Nexstar Arkansas Acquisition, Inc.
Nexstar Management, Inc.
Nexstar Broadcasting of Abilene, L.L.C.
Nexstar Broadcasting of Beaumont/Port Arthur, L.L.C.
Nexstar Broadcasting of Champaign, L.L.C.
Nexstar Broadcasting of Erie, L.L.C.
Nexstar Broadcasting of Joplin, L.L.C.
Nexstar Broadcasting of Louisiana, L.L.C.
Nexstar Broadcasting of Midland-Odessa, L.L.C.
Nexstar Broadcasting of the Midwest, Inc.
Nexstar Broadcasting of Northeastern Pennsylvania, L.L.C.
Nexstar Broadcasting of Peoria, L.L.C.
Nexstar Broadcasting of Rochester, L.L.C.
Nexstar Broadcasting of Wichita Falls, L.L.C.

                                      II-1

<PAGE>

                                  SCHEDULE III

             STATIONS LICENSED TO NEXSTAR BROADCASTING GROUP, L.L.C.

                               PORT ARTHUR, TEXAS
         Licensee: Nexstar Broadcasting of Beaumont/Port Arthur, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              KBTV-TV     08/01/2006
         (Channel 4, Port Arthur, Texas)
DTV STA                                                   KBTV-DT     05/22/2003
         (Channel 40, Port Arthur, Texas)

TV Intercity Relay                                        KB-98129    08/01/2006
TV Pickup                                                 KD-4600     08/01/2006
TV Pickup                                                 KE-5101     08/01/2006
Auxiliary Remote Pickup                                   KKX215      08/01/2006
TV Studio Transmitter Link                                KLA-89      08/01/2006
TV Pickup                                                 KT-2456     08/01/2006
TV Intercity Relay                                        WLD-443     08/01/2006
TV Intercity Relay                                        WPNG-520    08/01/2006

                              WICHITA FALLS, TEXAS
             Licensee: Nexstar Broadcasting of Wichita Falls, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              KFDX-TV     08/01/2006
         (Channel 3, Wichita Falls, Texas)
DTV STA                                                   KFDX-DT     08/13/2003
         (Channel 28, Wichita Falls, Texas)
Auxiliary Low Power System                                BLP00464    08/01/2006
TV Pickup                                                 KB-55270    08/01/2006
Auxiliary Remote Pickup                                   KLB-725     08/01/2006
TV Pickup                                                 KJ-3525     08/01/2006

                                      III-1

<PAGE>

                                 MIDLAND, TEXAS
            Licensee: Nexstar Broadcasting of Midland-Odessa, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ---------

TV Broadcast Station License                              KMID        08/01/2006
         (Channel 2, Midland, Texas)
DTV STA                                                   KMID-DT     05/22/2003
         (Channel 26, Midland, Texas)
TV Translator Station License                             K12FM       08/01/2006
TV Pickup                                                 KB-96686    08/01/2006
TV Studio Transmitter Link                                KKR-61      08/01/2006
TV Studio Transmitter Link                                KLB-45      08/01/2006
TV Studio Transmitter Link                                WHG-362     08/01/2006
TV Intercity Relay                                        WLE-628     08/01/2006
TV Intercity Relay                                        WLE-644     08/01/2006
TV Intercity Relay                                        WLF-217     08/01/2006
Weather Radar Station                                     WPMY-327    03/25/2004

                                 ABILENE, TEXAS
                Licensee: Nexstar Broadcasting of Abilene, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ---------

TV Broadcast Station License                              KTAB-TV     08/01/2006
         (Channel 32, Abilene, Texas)
DTV STA                                                   KTAB-DT     06/02/2003
         (Channel 24, Abilene, Texas)
Receive-Only Earth Station                                E8009       11/16/2004
Business Radio                                            KA-51599    04/17/2004
TV Pickup                                                 KS-5717     08/01/2006
Business Radio                                            WGA-708     04/17/2004
TV Studio Transmitter Link                                WGH-906     08/01/2006
Business Radio                                            WZJ-613     04/17/2004

                                      III-2

<PAGE>

                                TEXARKANA, TEXAS
               Licensee: Nexstar Broadcasting of Louisiana, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ---------

TV Broadcast Station License                              KTAL-TV     08/01/2006
         (Channel 6, Texarkana, Texas)
DTV Construction Permit                                   KTAL-DT     07/09/2003
         (Channel 15, Texarkana, Texas)
Auxiliary Low Power Station                               BLQ-74      08/01/2006
TV Pickup                                                 KA-88839    08/01/2006
Auxiliary Remote Pickup                                   KLB-589     08/01/2006
Auxiliary Remote Pickup                                   KLB-590     08/01/2006
Auxiliary Remote Pickup                                   KLB-591     08/01/2006
TV Intercity Relay                                        WHB-602     08/01/2006
TV Studio Transmitter Link                                WHB-603     08/01/2006
TV Studio Transmitter Link                                WHB-604     08/01/2006
TV Intercity Relay                                        WLP-781     08/01/2006
TV Intercity Relay                                        WLP-782     08/01/2006

                                      III-3

<PAGE>

                           WILKES-BARRE, PENNSYLVANIA
       Licensee: Nexstar Broadcasting of Northeastern Pennsylvania, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WBRE-TV     08/01/2007
         (Channel 28, Wilkes-Barre, Pennsylvania)
DTV STA                                                   WBRE-DT     05/13/2003
         (Channel 11, Wilkes-Barre, Pennsylvania)
TV Translator Station License                             W24BL       07/31/2007
TV Translator Station License                             W30AN       07/31/2007
TV Translator Station License                             W51BP       07/31/2007
TV Translator Station License                             W64AL       07/31/2007
Transmit-Only Earth Station License                       E910642     11/01/2011
Satellite Uplink Truck                                    E020058     05/03/2017
TV Pickup                                                 KA-35201    08/01/2007
TV Pickup                                                 KA-35425    08/01/2007
TV Pickup                                                 KA-74870    08/01/2007
TV Pickup                                                 KC-62824    08/01/2007
Broadcast Auxiliary                                       KF-5726     08/01/2007
R/P Base Mobile System                                    KGU-973     08/01/2007
TV Studio Transmitter Link                                KGH-66      08/01/2007
TV Pickup                                                 KK-4138     08/01/2007
TV Pickup                                                 KL-2535     08/01/2007
TV Pickup                                                 KP-4407     08/01/2007
R/P Base Mobile System                                    KQB-618     08/01/2007
TV Pickup                                                 KR-7688     08/01/2007
TV Pickup                                                 KR-7693     08/01/2007
TV Pickup                                                 KR-7771     08/01/2007
TV Pickup                                                 KS-2001     08/01/2007
TV Pickup                                                 KY-2899     08/01/2007
R/P Mobile                                                KY-5608     08/01/2007
TV Studio Transmitter Link                                KZO-21      08/01/2007
TV Intercity Relay                                        WFW-575     08/01/2007
TV Intercity Relay                                        WGI-290     08/01/2007
TV Intercity Relay                                        WHB-674     08/01/2007
TV Intercity Relay                                        WLI-324     08/01/2007
TV Intercity Relay                                        WLI-325     08/01/2007
TV Intercity Relay                                        WLI-337     08/01/2007

                                      III-4

<PAGE>

                               ERIE, PENNSYLVANIA
                 Licensee: Nexstar Broadcasting of Erie, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WJET-TV     08/01/2007
         (Channel 24, Erie, Pennsylvania)
DTV Construction Permit                                   WJET-DT     06/20/2003
         (Channel 58, Erie, Pennsylvania)
         DTV STA Request Accepted for Filing 03/13/2003
Auxiliary TV Broadcast Pickup                             KC-26079    08/01/2007
TV Intercity Relay                                        WPJE-618    08/01/2007
Weather Radar Station                                     WPOZ-488    09/14/2004
R/P Base Mobile System                                    WSM-744     08/01/2007

                               ROCHESTER, NEW YORK
               Licensee: Nexstar Broadcasting of Rochester, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WROC-TV     06/01/2007
         (Channel 8, Rochester, New York)
DTV STA                                                   WROC-DT     05/13/2003
         (Channel 45, Rochester, New York)
Receive-Only Earth Station                                E940506     09/15/2004
Transmit/Receive Earth Station                            E000660     12/12/2010
OFS Microwave                                             WPOU895     08/26/2009
TV Pickup                                                 KA-4851     06/01/2007
TV Intercity Relay                                        KA-6058     06/01/2007
TV Studio Transmitter Link                                KEA-91      06/01/2007
TV Pickup                                                 KR-4704     06/01/2007
TV Pickup                                                 KR-4705     06/01/2007
Auxiliary Remote Pickup                                   WHE-925     06/01/2007
Auxiliary Remote Pickup                                   WHE-926     06/01/2007

                                      III-5

<PAGE>

                              ST. JOSEPH, MISSOURI
               Licensee: Nexstar Broadcasting of the Midwest, Inc.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              KQTV        02/01/2006
         (Channel 2, St. Joseph, Missouri)
DTV Construction Permit                                   KQTV-DT     06/20/2003
         (Channel 53, St. Joseph, Missouri)
         STA Request Accepted for Filing on 03/17/2003
TV Pickup                                                 KC-26093    02/01/2006
R/P Automatic Relay                                       KQB-577     02/01/2006

                                JOPLIN, MISSOURI
                  Licensee: Nexstar Broadcasting Joplin, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              KSNF        02/01/2006
         (Channel 16, Joplin, Missouri)
DTV STA                                                   KSNF-DT     08/13/2003
         (Channel 46, Joplin, Missouri)
TV Pickup                                                 KW-6078     02/01/2006
Business Radio                                            WNKN-977    02/01/2006
Weather Radar Station                                     WPMJ-419    08/12/2003

                                      III-6

<PAGE>

                              TERRE HAUTE, INDIANA
               Licensee: Nexstar Broadcasting of the Midwest, Inc.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WTWO        08/01/2005
         (Channel 2, Terre Haute, Indiana)
DTV STA                                                   WTWO-DT     08/27/2003
         (Channel 36, Terre Haute, Indiana)
TV Pickup                                                 KC-26086    08/01/2005
R/P Base Mobile System                                    KLH-391     08/01/2005
Weather Radar Station                                     KVB-629     03/30/2004
Broadcast Auxiliary                                       KW-4107     08/01/2005
TV Pickup                                                 KW-4108     08/01/2005
TV Intercity Relay                                        WHF-306     08/01/2005
TV Intercity Relay                                        WMU-968     08/01/2005
Weather Radar Station                                     WPPH-816    01/06/2005

                              SPRINGFIELD, ILLINOIS
               Licensee: Nexstar Broadcasting of Champaign, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WCFN        12/01/2005
         (Channel 49, Springfield, Illinois)
DTV STA                                                   WCFN-DT     04/09/2003
         (Channel 53, Springfield, Illinois)
TV Studio Transmitter Link                                WLD-973     12/01/2005

                                      III-7

<PAGE>

                               CHAMPAIGN, ILLINOIS
               Licensee: Nexstar Broadcasting of Champaign, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WCIA        12/01/2005
         (Channel 3, Champaign, Illinois)
DTV STA                                                   WCIA-DT     04/09/2003
         (Channel 48, Champaign, Illinois)
Transmit-Receive Earth Station                            E920434     07/24/2017
Auxiliary Low Power Station                               BLP00192    12/01/2005
Auxiliary Low Power Station                               BLP00322    12/01/2005
Auxiliary Low Power Station                               BLP00544    12/01/2005
Auxiliary Low Power Station                               BLP00883    12/01/2005
Auxiliary Low Power Station                               BLP00919    12/01/2005
Auxiliary Low Power Station                               BLP01124    12/01/2005
Auxiliary Low Power Station                               BLP01288    12/01/2005
TV Pickup                                                 KA-95317    12/01/2005
Business Radio                                            KAP-730     12/01/2005
TV Pickup                                                 KC-5875     12/01/2005
Auxiliary Remote Pickup                                   KSD-920     12/01/2005
Auxiliary Remote Pickup                                   KSD-921     12/01/2005
TV Studio Transmitter Link                                KSG-35      12/01/2005
TV Intercity Relay                                        KSI-74      12/01/2005
TV Intercity Relay                                        KSI-75      12/01/2005
TV Pickup                                                 KW-6065     12/01/2005
TV Pickup                                                 KW-6066     12/01/2005
TV Pickup                                                 KW-6073     12/01/2005
TV Pickup                                                 KW-6074     12/01/2005
TV Intercity Relay                                        WBJ-983     12/01/2005
TV Intercity Relay                                        WBJ-986     12/01/2005
TV Intercity Relay                                        WBJ-987     12/01/2005
TV Intercity Relay                                        WBJ-988     12/01/2005
TV Intercity Relay                                        WLG-233     12/01/2005
TV Intercity Relay                                        WPNL-408    12/01/2005

                                      III-8

<PAGE>

                                PEORIA, ILLINOIS
                Licensee: Nexstar Broadcasting of Peoria, L.L.C.

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              WMBD-TV     12/01/2005
         (Channel 31, Peoria, Illinois)
DTV Construction Permit                                   WMDB-DT     06/20/2003
         (Channel 30, Peoria, Illinois)
TV Pickup                                                 KA-88843    12/01/2005
TV Pickup                                                 KA-88844    12/01/2005
TV Intercity Relay                                        KSI-71      12/01/2005
TV Intercity Relay                                        KSI-72      12/01/2005
TV Intercity Relay                                        KSI-73      12/01/2005
Remote Pick-up                                            KSJ-777     12/01/2005
TV Studio Transmitter Link                                KSK-48      12/01/2005
TV Intercity Relay                                        WBJ-984     12/01/2005
TV Intercity Relay                                        WBJ-985     12/01/2005
TV Intercity Relay                                        WLG-752     12/01/2005
TV Intercity Relay                                        WMV-276     12/01/2005
OFS Microwave                                             WNTX-533    02/08/2010

                                      III-9

<PAGE>

                 STATIONS LICENSED TO MISSION BROADCASTING, INC.

                             SCRANTON, PENNSYLVANIA

Facility Type                                        Call Sign   Exp. Date
-------------                                        ---------   ----------
TV Broadcast Station License                         WYOU        08/01/2007
         (Channel 22, Scranton, Pennsylvania)
DTV STA                                              WYOU-DT     05/08/2003
         (Channel 13, Scranton, Pennsylvania)
TV Translator License                                W19AR       08/01/2007
TV Translator License                                W26AT       08/01/2007
TV Translator License                                W54AV       08/01/2007
TV Translator License                                W55AG       08/01/2007
TV Translator License                                W60AH       08/01/2007
TV Translator License                                W66AI       08/01/2007
Auxiliary Low Power                                  BLQ-375     08/01/2007
TV Pickup                                            KA-35173    08/01/2007
TV Pickup                                            KA-35184    08/01/2007
TV Pickup                                            KA-35185    08/01/2007
Auxiliary Remote Pickup                              KB-97161    08/01/2007
TV Studio Transmitter Link                           KGH-69      08/01/2007
TV Intercity Relay                                   KGI-49      08/01/2007
TV Intercity Relay                                   KHC-88      08/01/2007
TV Pickup                                            KO-9753     08/01/2007
Auxiliary Remote Pickup                              KPH-450     08/01/2007
Auxiliary Remote Pickup                              KPJ-719     08/01/2007
Auxiliary Remote Pickup                              KQB-642     08/01/2007
Auxiliary Remote Pickup                              KQB-643     08/01/2007
TV Intercity Relay                                   WFD-523     08/01/2007
TV Studio Transmitter Link                           WLL-212     08/01/2007
TV Intercity Relay                                   WLO-276     08/01/2007
TV Intercity Relay                                   WLO-277     08/01/2007
TV Studio Transmitter Link                           WPNF-884    08/01/2007

                               ERIE, PENNSYLVANIA

Facility Type                                        Call Sign   Exp. Date
-------------                                        ---------   ---------

TV Broadcast Station License                         WFXP        08/01/2007
         (Channel 66, Erie, Pennsylvania)
DTV Construction Permit                              WFXP-DT     Not yet granted
         (Channel 22, Erie, Pennsylvania)
TV Studio Transmitter Link                           WLD-767     08/01/2007

                                     III-10

<PAGE>

                              WICHITA FALLS, TEXAS

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              KJTL        08/01/2006
         (Channel 18, Wichita Falls, Texas)
DTV STA                                                   KJTL-DT     07/22/2003
         (Channel 15, Wichita Falls, Texas)
LPTV Broadcast Station License                            KJBO-LP     08/01/2006
         (Channel 35, Wichita Falls, Texas)
TV Translator License                                     K47DK       06/01/2006
TV Translator License                                     K53DS       06/01/2006
TV Studio Transmitter Link                                WLD-942     08/01/2006
TV Studio Transmitter Link                                WLJ-748     08/01/2006

                                JOPLIN, MISSOURI

Facility Type                                             Call Sign   Exp. Date
-------------                                             ---------   ----------

TV Broadcast Station License                              KODE-TV     02/01/2006
         (Channel 12, Joplin, Missouri)
DTV STA                                                   KODE-DT     08/13/2002
         (Channel 43, Joplin, Missouri)
TV Pickup                                                 KC62805     02/01/2006
TV Pickup                                                 KM3441      02/01/2006
Remote Pickup                                             KPH932      02/01/2006
TV Pickup                                                 KR7926      02/01/2006
Remote Pickup                                             KTK819      02/01/2006
Weather Radar Station                                     WPFW393     10/25/2004
Business Radio                                            WNEQ599     05/29/2012
Business Radio                                            WNEH385     04/28/2012
Business Radio                                            WNEH386     04/28/2012

                                     III-11

<PAGE>

                                   SCHEDULE IV
                         Initial Purchasers Information

                                      IV-1

<PAGE>

                                    EXHIBIT A

                                       A-1

<PAGE>

                                    EXHIBIT B

                                       B-1

<PAGE>

                                     ANNEX I

                  Resale Pursuant to Regulation S or Rule 144A. Each Initial
Purchaser understands that:

                  Such Initial Purchaser agrees that it has not offered or sold
and will not offer or sell the Notes in the United States or to, or for the
benefit or account of, a U.S. Person (other than a distributor), in each case,
as defined in Rule 902 under the Securities Act as part of its distribution at
any time and (ii) otherwise until 40 days after the later of the commencement of
the offering of the Notes pursuant hereto and the Closing Date, other than in
accordance with Regulation S of the Securities Act or another exemption from the
registration requirements of the Securities Act. Such Initial Purchaser agrees
that, during such 40-day restricted period, it will not cause any advertisement
with respect to the Notes (including any "tombstone" advertisement) to be
published in any newspaper or periodical or posted in any public place and will
not issue any circular relating to the Notes, except such advertisements as are
permitted by and include the statements required by Regulation S.

                  Such Initial Purchaser agrees that, at or prior to
confirmation of a sale of Notes by it to any distributor, dealer or person
receiving a selling concession, fee or other remuneration during the 40-day
restricted period referred to in Rule 903 under the Securities Act, it will send
to such distributor, dealer or person receiving a selling concession, fee or
other remuneration a confirmation or notice to substantially the following
effect:

                  "The Notes covered hereby have not been registered under the
         U.S. Securities Act of 1933, as amended (the "Securities Act"), and may
         not be offered and sold within the United States or to, or for the
         account or benefit of, U.S. persons as part of your distribution at any
         time or (ii) otherwise until 40 days after the later of the date the
         Notes were first offered to persons other than "distributors" (as
         defined in Regulation S) in reliance upon Regulation S and the Closing
         Date, except in either case in accordance with Regulation S under the
         Securities Act (or Rule 144A or to Accredited Institutions in
         transactions that are exempt from the registration requirements of the
         Securities Act), and in connection with any subsequent sale by you of
         the Notes covered hereby in reliance on Regulation S during the period
         referred to above to any distributor, dealer or person receiving a
         selling concession, fee or other remuneration, you must deliver a
         notice to substantially the foregoing effect. Terms used above have the
         meanings assigned to them in Regulation S."

                                                                               1<PAGE>

[LOGO OF THE BOND MARKET ASSOCIATION]

                                                                   EXHIBIT 10.23

MASTER REPURCHASE
AGREEMENT

September 1996 Version

Dated as of  4/24/03

Between: Banc of America Securities LLC

and The PMI Group, Inc.

1. APPLICABILITY
From time to time the parties hereto may enter into transactions in which one
party ("Seller") agrees to transfer to the other ("Buyer") securities or other
assets ("Securities") against the transfer of funds by Buyer, with a
simultaneous agreement by Buyer to transfer to Seller such Securities at a date
certain or on demand, against the transfer of funds by Seller. Each such
transaction shall be referred to herein as a "Transaction" and, unless otherwise
agreed in writing, shall be governed by this Agreement, including any
supplemental terms or conditions contained in Annex I hereto and in any other
annexes identified herein or therein as applicable hereunder.

2. DEFINITIONS
(a) "Act of Insolvency", with respect to any party, (i) the commencement by such
party as debtor of any case or proceeding under any bankruptcy, insolvency,
reorganization, liquidation, moratorium, dissolution, delinquency or similar
law, or such party seeking the appointment or election of a receiver,
conservator, trustee, custodian or similar official for such party or any
substantial part of its property, or the convening of any meeting of creditors
for purposes of commencing any such case or proceeding or seeking such an
appointment or election, (ii) the commencement of any such case or proceeding
against such party, or another seeking such an appointment or election, or the
filing against a party of an application for a protective decree under the
provisions of the Securities Investor Protection Act of 1970, which (A) is
consented to or not timely contested by such party, (B) results in the entry of
an order for relief, such an appointment or election, the issuance of such a
protective decree or the entry of an order having a similar effect, or (C) is
not dismissed within 15 days, (iii) the making by such party of a general
assignment for the benefit of creditors, or (iv) the admission in writing by
such party of such party's inability to pay such party's debts as they become
due;

(b) "Additional Purchased Securities", Securities provided by Seller to Buyer
pursuant to Paragraph 4(a) hereof;

(c) "Buyer's Margin Amount", with respect to any Transaction as of any date, the
amount obtained by application of the Buyer's Margin Percentage to the
Repurchase Price for such Transaction as of such date;

<PAGE>

(d) "Buyer's Margin Percentage", with respect to any Transaction as of any date,
a percentage (which may be equal to the Seller's Margin Percentage) agreed to by
Buyer and Seller or, in the absence of any such agreement, the percentage
obtained by dividing the Market Value of the Purchased Securities on the
Purchase Date by the Purchase Price on the Purchase Date for such Transaction;

(e) "Confirmation", the meaning specified in Paragraph 3(b) hereof;

(f) "Income", with respect to any Security at any time, any principal thereof
and all interest, dividends or other distributions thereon;

(g) "Margin Deficit", the meaning specified in Paragraph 4(a) hereof;

(h) "Margin Excess", the meaning specified in Paragraph 4(b) hereof;

(i) "Margin Notice Deadline", the time agreed to by the parties in the relevant
Confirmation, Annex I hereto or otherwise as the deadline for giving notice
requiring same-day satisfaction of margin maintenance obligations as provided in
Paragraph 4 hereof (or, in the absence of any such agreement, the deadline for
such purposes established in accordance with market practice);

(j) "Market Value", with respect to any Securities as of any date, the price for
such Securities on such date obtained from a generally recognized source agreed
to by the parties or the most recent closing bid quotation from such a source,
plus accrued Income to the extent not included therein (other than any Income
credited or transferred to, or applied to the obligations of, Seller pursuant to
Paragraph 5 hereof ) as of such date (unless contrary to market practice for
such Securities);

(k) "Price Differential", with respect to any Transaction as of any date, the
aggregate amount obtained by daily application of the Pricing Rate for such
Transaction to the Purchase Price for such Transaction on a 360 day per year
basis for the actual number of days during the period commencing on (and
including) the Purchase Date for such Transaction and ending on (but excluding)
the date of determination (reduced by any amount of such Price Differential
previously paid by Seller to Buyer with respect to such Transaction);

(l) "Pricing Rate", the per annum percentage rate for determination of the Price
Differential;

(m) "Prime Rate", the prime rate of U.S. commercial banks as published in The
Wall Street Journal (or, if more than one such rate is published, the average of
such rates);

(n) "Purchase Date", the date on which Purchased Securities are to be
transferred by Seller to Buyer;.

(o) "Purchase Price", (i) on the Purchase Date, the price at which Purchased
Securities are transferred by Seller to Buyer, and (ii) thereafter, except where
Buyer and Seller agree otherwise, such price increased by the amount of any cash
transferred by Buyer to Seller pursuant to Paragraph 4(b) hereof and decreased
by the amount of any cash transferred by Seller to Buyer pursuant to Paragraph
4(a) hereof or applied to reduce Seller's obligations under clause (ii) of
Paragraph 5 hereof;

(p) "Purchased Securities", the Securities transferred by Seller to Buyer in a
Transaction hereunder, and any Securities substituted therefor in accordance
with Paragraph 9 hereof. The term "Purchased Securities" with respect to any
Transaction at any time also shall include Additional Purchased Securities
delivered pursuant to Paragraph 4(a) hereof and shall exclude Securities
returned pursuant to Paragraph 4(b) hereof;

(q) "Repurchase Date", the date on which Seller is to repurchase the Purchased
Securities from Buyer, including any date determined by application of the
provisions of Paragraph 3(c) or 11 hereof;

(r) "Repurchase Price", the price at which Purchased Securities are to be
transferred from Buyer to Seller upon termination of a Transaction, which will
be determined in each case (including Transactions

                                        2

<PAGE>

terminable upon demand) as the sum of the Purchase Price and the Price
Differential as of the date of such determination;

(s) "Seller's Margin Amount", with respect to any Transaction as of any date,
the amount obtained by application of the Seller's Margin Percentage to the
Repurchase Price for such Transaction as of such date;

(t) "Seller's Margin Percentage", with respect to any Transaction as of any
date, a percentage (which may be equal to the Buyer's Margin Percentage) agreed
to by Buyer and Seller or, in the absence of any such agreement, the percentage
obtained by dividing the Market Value of the Purchased Securities on the
Purchase Date by the Purchase Price on the Purchase Date for such Transaction.

3. INITIATION; CONFIRMATION; TERMINATION
(a) An agreement to enter into a Transaction may be made orally or in writing at
the initiation of either Buyer or Seller. On the Purchase Date for the
Transaction, the Purchased Securities shall be transferred to Buyer or its agent
against the transfer of the Purchase Price to an account of Seller.

(b) Upon agreeing to enter into a Transaction hereunder, Buyer or Seller (or
both), as shall be agreed, shall promptly deliver to the other party a written
confirmation of each Transaction (a "Confirmation"). The Confirmation shall
describe the Purchased Securities (including CUSIP number, if any), identify
Buyer and Seller and set forth (i) the Purchase Date, (ii) the Purchase Price,
(iii) the Repurchase Date, unless the Transaction is to be terminable on demand,
(iv) the Pricing Rate or Repurchase Price applicable to the Transaction, and (v)
any additional terms or conditions of the Transaction not inconsistent with this
Agreement. The Confirmation, together with this Agreement, shall constitute
conclusive evidence of the terms agreed between Buyer and Seller with respect to
the Transaction to which the Confirmation relates, unless with respect to the
Confirmation specific objection is made promptly after receipt thereof. In the
event of any conflict between the terms of such Confirmation and this Agreement,
this Agreement shall prevail.

(c) In the case of Transactions terminable upon demand, such demand shall be
made by Buyer or Seller, no later than such time as is customary in accordance
with market practice, by telephone or otherwise on or prior to the business day
on which such termination will be effective. On the date specified in such
demand, or on the date fixed for termination in the case of Transactions having
a fixed term, termination of the Transaction will be effected by transfer to
Seller or its agent of the Purchased Securities and any Income in respect
thereof received by Buyer (and not previously credited or transferred to, or
applied to the obligations of, Seller pursuant to Paragraph 5 hereof ) against
the transfer of the Repurchase Price to an account of Buyer.

4. MARGIN MAINTENANCE
(a) If at any time the aggregate Market Value of all Purchased Securities
subject to all Transactions in which a particular party hereto is acting as
Buyer is less than the aggregate Buyer's Margin Amount for all such Transactions
(a "Margin Deficit"), then Buyer may by notice to Seller require Seller in such
Transactions, at Seller's option, to transfer to Buyer cash or additional
Securities reasonably acceptable to Buyer ("Additional Purchased Securities"),
so that the cash and aggregate Market Value of the Purchased Securities,
including any such Additional Purchased Securities, will thereupon equal or
exceed such aggregate Buyer's Margin Amount (decreased by the amount of any
Margin Deficit as of such date arising from any Transactions in which such Buyer
is acting as Seller).

(b) If at any time the aggregate Market Value of all Purchased Securities
subject to all Transactions in which a particular party hereto is acting as
Seller exceeds the aggregate Seller's Margin Amount for all such Transactions at
such time (a "Margin Excess"), then Seller may by notice to Buyer require Buyer
in such Transactions, at Buyer's option, to transfer cash or Purchased
Securities to Seller, so that the aggregate Market Value of the Purchased
Securities, after deduction of any such cash or any Purchased Securities so
transferred, will thereupon not exceed such aggregate Seller's Margin Amount
(increased by

                                        3

<PAGE>

the amount of any Margin Excess as of such date arising from any Transactions in
which such Seller is acting as Buyer).

(c) If any notice is given by Buyer or Seller under subparagraph (a) or (b) of
this Paragraph at or before the Margin Notice Deadline on any business day, the
party receiving such notice shall transfer cash or Additional Purchased
Securities as provided in such subparagraph no later than the close of business
in the relevant market on such day. If any such notice is given after the Margin
Notice Deadline, the party receiving such notice shall transfer such cash or
Securities no later than the close of business in the relevant market on the
next business day following such notice.

(d) Any cash transferred pursuant to this Paragraph shall be attributed to such
Transactions as shall be agreed upon by Buyer and Seller.

(e) Seller and Buyer may agree, with respect to any or all Transactions
hereunder, that the respective rights of Buyer or Seller (or both) under
subparagraphs (a) and (b) of this Paragraph may be exercised only where a Margin
Deficit or Margin Excess, as the case may be, exceeds a specified dollar amount
or a specified percentage of the Repurchase Prices for such Transactions (which
amount or percentage shall be agreed to by Buyer and Seller prior to entering
into any such Transactions).

(f) Seller and Buyer may agree, with respect to any or all Transactions
hereunder, that the respective rights of Buyer and Seller under subparagraphs
(a) and (b) of this Paragraph to require the elimination of a Margin Deficit or
a Margin Excess, as the case may be, may be exercised whenever such a Margin
Deficit or Margin Excess exists with respect to any single Transaction hereunder
(calculated without regard to any other Transaction outstanding under this
Agreement).

5. INCOME PAYMENTS
Seller shall be entitled to receive an amount equal to all Income paid or
distributed on or in respect of the Securities that is not otherwise received by
Seller, to the full extent it would be so entitled if the Securities had not
been sold to Buyer. Buyer shall, as the parties may agree with respect to any
Transaction (or, in the absence of any such agreement, as Buyer shall reasonably
determine in its discretion), on the date such Income is paid or distributed
either (i) transfer to or credit to the account of Seller such Income with
respect to any Purchased Securities subject to such Transaction or (ii) with
respect to Income paid in cash, apply the Income payment or payments to reduce
the amount, if any, to be transferred to Buyer by Seller upon termination of
such Transaction. Buyer shall not be obligated to take any action pursuant to
the preceding sentence (A) to the extent that such action would result in the
creation of a Margin Deficit, unless prior thereto or simultaneously therewith
Seller transfers to Buyer cash or Additional Purchased Securities sufficient to
eliminate such Margin Deficit, or (B) if an Event of Default with respect to
Seller has occurred and is then continuing at the time such Income is paid or
distributed.

6. SECURITY INTEREST
Although the parties intend that all Transactions hereunder be sales and
purchases and not loans, in the event any such Transactions are deemed to be
loans, Seller shall be deemed to have pledged to Buyer as security for the
performance by Seller of its obligations under each such Transaction, and shall
be deemed to have granted to Buyer a security interest in, all of the Purchased
Securities with respect to all Transactions hereunder and all Income thereon and
other proceeds thereof.

7. PAYMENT AND TRANSFER
Unless otherwise mutually agreed, all transfers of funds hereunder shall be in
immediately available funds. All Securities transferred by one party hereto to
the other party (i) shall be in suitable form for transfer or shall be
accompanied by duly executed instruments of transfer or assignment in blank and
such other documentation as the party receiving possession may reasonably
request, (ii) shall be transferred on the

                                        4

<PAGE>

book-entry system of a Federal Reserve Bank, or (iii) shall be transferred by
any other method mutually acceptable to Seller and Buyer.

8. SEGREGATION OF PURCHASED SECURITIES
To the extent required by applicable law, all Purchased Securities in the
possession of Seller shall be segregated from other securities in its possession
and shall be identified as subject to this Agreement. Segregation may be
accomplished by appropriate identification on the books and records of the
holder, including a financial or securities intermediary or a clearing
corporation. All of Seller's interest in the Purchased Securities shall pass to
Buyer on the Purchase Date and, unless otherwise agreed by Buyer and Seller,
nothing in this Agreement shall preclude Buyer from engaging in repurchase
transactions with the Purchased Securities or otherwise selling, transferring,
pledging or hypothecating the Purchased Securities, but no such transaction
shall relieve Buyer of its obligations to transfer Purchased Securities to
Seller pursuant to Paragraph 3, 4 or 11 hereof, or of Buyer's obligation to
credit or pay Income to, or apply Income to the obligations of, Seller pursuant
to Paragraph 5 hereof.

Required Disclosure for Transactions in Which the Seller Retains Custody of the
Purchased Securities
Seller is not permitted to substitute other securities for those subject to this
Agreement and therefore must keep Buyer's securities segregated at all times,
unless in this Agreement Buyer grants Seller the right to substitute other
securities. If Buyer grants the right to substitute, this means that Buyer's
securities will likely be commingled with Seller's own securities during the
trading day. Buyer is advised that, during any trading day that Buyer's
securities are commingled with Seller's securities, they [will]* [may]** be
subject to liens granted by Seller to [its clearing bank]* [third parties]** and
may be used by Seller for deliveries on other securities transactions. Whenever
the securities are commingled, Seller's ability to resegregate substitute
securities for Buyer will be subject to Seller's ability to satisfy [the
clearing]* [any]** lien or to obtain substitute securities.

* Language to be used under 17 C.F.R. (beta)403.4(e) if Seller is a government
securities broker or dealer other than a financial institution.

** Language to be used under 17 C.F.R.(beta)403.5(d) if Seller is a financial
institution.

9. SUBSTITUTION
(a) Seller may, subject to agreement with and acceptance by Buyer, substitute
other Securities for any Purchased Securities. Such substitution shall be made
by transfer to Buyer of such other Securities and transfer to Seller of such
Purchased Securities. After substitution, the substituted Securities shall be
deemed to be Purchased Securities.

(b) In Transactions in which Seller retains custody of Purchased Securities, the
parties expressly agree that Buyer shall be deemed, for purposes of subparagraph
(a) of this Paragraph, to have agreed to and accepted in this Agreement
substitution by Seller of other Securities for Purchased Securities; provided,
however, that such other Securities shall have a Market Value at least equal to
the Market Value of the Purchased Securities for which they are substituted.

10.REPRESENTATIONS
Each of Buyer and Seller represents and warrants to the other that (i) it is
duly authorized to execute and deliver this Agreement, to enter into
Transactions contemplated hereunder and to perform its obligations hereunder and
has taken all necessary action to authorize such execution, delivery and
performance, (ii) it

                                        5

<PAGE>

will engage in such Transactions as principal (or, if agreed in writing, in the
form of an annex hereto or otherwise, in advance of any Transaction by the other
party hereto, as agent for a disclosed principal), (iii) the person signing this
Agreement on its behalf is duly authorized to do so on its behalf (or on behalf
of any such disclosed principal), (iv) it has obtained all authorizations of any
governmental body required in connection with this Agreement and the
Transactions hereunder and such authorizations are in full force and effect and
(v) the execution, delivery and performance of this Agreement and the
Transactions hereunder will not violate any law, ordinance, charter, by-law or
rule applicable to it or any agreement by which it is bound or by which any of
its assets are affected. On the Purchase Date for any Transaction Buyer and
Seller shall each be deemed to repeat all the foregoing representations made by
it.

11.EVENTS OF DEFAULT
In the event that (i) Seller fails to transfer or Buyer fails to purchase
Purchased Securities upon the applicable Purchase Date, (ii) Seller fails to
repurchase or Buyer fails to transfer Purchased Securities upon the applicable
Repurchase Date, (iii) Seller or Buyer fails to comply with Paragraph 4 hereof,
(iv) Buyer fails, after one business day's notice, to comply with Paragraph 5
hereof, (v) an Act of Insolvency occurs with respect to Seller or Buyer, (vi)
any representation made by Seller or Buyer shall have been incorrect or untrue
in any material respect when made or repeated or deemed to have been made or
repeated, or (vii) Seller or Buyer shall admit to the other its inability to, or
its intention not to, perform any of its obligations hereunder (each an "Event
of Default"):

(a) The nondefaulting party may, at its option (which option shall be deemed to
have been exercised immediately upon the occurrence of an Act of Insolvency),
declare an Event of Default to have occurred hereunder and, upon the exercise or
deemed exercise of such option, the Repurchase Date for each Transaction
hereunder shall, if it has not already occurred, be deemed immediately to occur
(except that, in the event that the Purchase Date for any Transaction has not
yet occurred as of the date of such exercise or deemed exercise, such
Transaction shall be deemed immediately canceled). The nondefaulting party shall
(except upon the occurrence of an Act of Insolvency) give notice to the
defaulting party of the exercise of such option as promptly as practicable.

(b) In all Transactions in which the defaulting party is acting as Seller, if
the nondefaulting party exercises or is deemed to have exercised the option
referred to in subparagraph (a) of this Paragraph, (i) the defaulting party's
obligations in such Transactions to repurchase all Purchased Securities, at the
Repurchase Price therefor on the Repurchase Date determined in accordance with
subparagraph (a) of this Paragraph, shall thereupon become immediately due and
payable, (ii) all Income paid after such exercise or deemed exercise shall be
retained by the nondefaulting party and applied to the aggregate unpaid
Repurchase Prices and any other amounts owing by the defaulting party hereunder,
and (iii) the defaulting party shall immediately deliver to the nondefaulting
party any Purchased Securities subject to such Transactions then in the
defaulting party's possession or control.

(c) In all Transactions in which the defaulting party is acting as Buyer, upon
tender by the nondefaulting party of payment of the aggregate Repurchase Prices
for all such Transactions, all right, title and interest in and entitlement to
all Purchased Securities subject to such Transactions shall be deemed
transferred to the nondefaulting party, and the defaulting party shall deliver
all such Purchased Securities to the nondefaulting party.

(d) If the nondefaulting party exercises or is deemed to have exercised the
option referred to in subparagraph (a) of this Paragraph, the nondefaulting
party, without prior notice to the defaulting party, may:

     (i) as to Transactions in which the defaulting party is acting as Seller,
     (A) immediately sell, in a recognized market (or otherwise in a
     commercially reasonable manner) at such price or prices as the
     nondefaulting party may reasonably deem satisfactory, any or all Purchased
     Securities subject to such Transactions and apply the proceeds thereof to
     the aggregate unpaid Repurchase Prices

                                        6

<PAGE>

     and any other amounts owing by the defaulting party hereunder or (B) in its
     sole discretion elect, in lieu of selling all or a portion of such
     Purchased Securities, to give the defaulting party credit for such
     Purchased Securities in an amount equal to the price therefor on such date,
     obtained from a generally recognized source or the most recent closing bid
     quotation from such a source, against the aggregate unpaid Repurchase
     Prices and any other amounts owing by the defaulting party hereunder; and

     (ii) as to Transactions in which the defaulting party is acting as Buyer,
     (A) immediately purchase, in a recognized market (or otherwise in a
     commercially reasonable manner) at such price or prices as the
     nondefaulting party may reasonably deem satisfactory, securities
     ("Replacement Securities") of the same class and amount as any Purchased
     Securities that are not delivered by the defaulting party to the
     nondefaulting party as required hereunder or (B) in its sole discretion
     elect, in lieu of purchasing Replacement Securities, to be deemed to have
     purchased Replacement Securities at the price therefor on such date,
     obtained from a generally recognized source or the most recent closing
     offer quotation from such a source.

Unless otherwise provided in Annex I, the parties acknowledge and agree that (1)
the Securities subject to any Transaction hereunder are instruments traded in a
recognized market, (2) in the absence of a generally recognized source for
prices or bid or offer quotations for any Security, the nondefaulting party may
establish the source therefor in its sole discretion and (3) all prices, bids
and offers shall be determined together with accrued Income (except to the
extent contrary to market practice with respect to the relevant Securities).

(e) As to Transactions in which the defaulting party is acting as Buyer, the
defaulting party shall be liable to the nondefaulting party for any excess of
the price paid (or deemed paid) by the nondefaulting party for Replacement
Securities over the Repurchase Price for the Purchased Securities replaced
thereby and for any amounts payable by the defaulting party under Paragraph 5
hereof or otherwise hereunder.

(f) For purposes of this Paragraph 11, the Repurchase Price for each Transaction
hereunder in respect of which the defaulting party is acting as Buyer shall not
increase above the amount of such Repurchase Price for such Transaction
determined as of the date of the exercise or deemed exercise by the
nondefaulting party of the option referred to in subparagraph (a) of this
Paragraph.

(g) The defaulting party shall be liable to the nondefaulting party for (i) the
amount of all reasonable legal or other expenses incurred by the nondefaulting
party in connection with or as a result of an Event of Default, (ii) damages in
an amount equal to the cost (including all fees, expenses and commissions) of
entering into replacement transactions and entering into or terminating hedge
transactions in connection with or as a result of an Event of Default, and (iii)
any other loss, damage, cost or expense directly arising or resulting from the
occurrence of an Event of Default in respect of a Transaction.

(h) To the extent permitted by applicable law, the defaulting party shall be
liable to the nondefaulting party for interest on any amounts owing by the
defaulting party hereunder, from the date the defaulting party becomes liable
for such amounts hereunder until such amounts are (i) paid in full by the
defaulting party or (ii) satisfied in full by the exercise of the nondefaulting
party's rights hereunder. Interest on any sum payable by the defaulting party to
the nondefaulting party under this Paragraph 11(h) shall be at a rate equal to
the greater of the Pricing Rate for the relevant Transaction or the Prime Rate.

(i) The nondefaulting party shall have, in addition to its rights hereunder, any
rights otherwise available to it under any other agreement or applicable law.

                                        7

<PAGE>

12.SINGLE AGREEMENT
Buyer and Seller acknowledge that, and have entered hereinto and will enter into
each Transaction hereunder in consideration of and in reliance upon the fact
that, all Transactions hereunder constitute a single business and contractual
relationship and have been made in consideration of each other. Accordingly,
each of Buyer and Seller agrees (i) to perform all of its obligations in respect
of each Transaction hereunder, and that a default in the performance of any such
obligations shall constitute a default by it in respect of all Transactions
hereunder, (ii) that each of them shall be entitled to set off claims and apply
property held by them in respect of any Transaction against obligations owing to
them in respect of any other Transactions hereunder and (iii) that payments,
deliveries and other transfers made by either of them in respect of any
Transaction shall be deemed to have been made in consideration of payments,
deliveries and other transfers in respect of any other Transactions hereunder,
and the obligations to make any such payments, deliveries and other transfers
may be applied against each other and netted.

13.NOTICES AND OTHER COMMUNICATIONS
Any and all notices, statements, demands or other communications hereunder may
be given by a party to the other by mail, facsimile, telegraph, messenger or
otherwise to the address specified in Annex II hereto, or so sent to such party
at any other place specified in a notice of change of address hereafter received
by the other. All notices, demands and requests hereunder may be made orally, to
be confirmed promptly in writing, or by other communication as specified in the
preceding sentence.

14.ENTIRE AGREEMENT; SEVERABILITY
This Agreement shall supersede any existing agreements between the parties
containing general terms and conditions for repurchase transactions. Each
provision and agreement herein shall be treated as separate and independent from
any other provision or agreement herein and shall be enforceable notwithstanding
the unenforceability of any such other provision or agreement.

15.NON-ASSIGNABILITY; TERMINATION
(a) The rights and obligations of the parties under this Agreement and under any
Transaction shall not be assigned by either party without the prior written
consent of the other party, and any such assignment without the prior written
consent of the other party shall be null and void. Subject to the foregoing,
this Agreement and any Transactions shall be binding upon and shall inure to the
benefit of the parties and their respective successors and assigns. This
Agreement may be terminated by either party upon giving written notice to the
other, except that this Agreement shall, notwithstanding such notice, remain
applicable to any Transactions then outstanding.

(b) Subparagraph (a) of this Paragraph 15 shall not preclude a party from
assigning, charging or otherwise dealing with all or any part of its interest in
any sum payable to it under Paragraph 11 hereof.

16.GOVERNING LAW
This Agreement shall be governed by the laws of the State of New York without
giving effect to the conflict of law principles thereof.

17.NO WAIVERS, ETC.
No express or implied waiver of any Event of Default by either party shall
constitute a waiver of any other Event of Default and no exercise of any remedy
hereunder by any party shall constitute a waiver of its right to exercise any
other remedy hereunder. No modification or waiver of any provision of this
Agreement and no consent by any party to a departure herefrom shall be effective
unless and until such shall be in writing and duly executed by both of the
parties hereto. Without limitation on any of the foregoing, the failure to

                                        8

<PAGE>

give a notice pursuant to Paragraph 4(a) or 4(b) hereof will not constitute a
waiver of any right to do so at a later date.

18.USE OF EMPLOYEE PLAN ASSETS
(a) If assets of an employee benefit plan subject to any provision of the
Employee Retirement Income Security Act of 1974 ("ERISA") are intended to be
used by either party hereto (the "Plan Party") in a Transaction, the Plan Party
shall so notify the other party prior to the Transaction. The Plan Party shall
represent in writing to the other party that the Transaction does not constitute
a prohibited transaction under ERISA or is otherwise exempt therefrom, and the
other party may proceed in reliance thereon but shall not be required so to
proceed.

(b) Subject to the last sentence of subparagraph (a) of this Paragraph, any such
Transaction shall proceed only if Seller furnishes or has furnished to Buyer its
most recent available audited statement of its financial condition and its most
recent subsequent unaudited statement of its financial condition.

(c) By entering into a Transaction pursuant to this Paragraph, Seller shall be
deemed (i) to represent to Buyer that since the date of Seller's latest such
financial statements, there has been no material adverse change in Seller's
financial condition which Seller has not disclosed to Buyer, and (ii) to agree
to provide Buyer with future audited and unaudited statements of its financial
condition as they are issued, so long as it is a Seller in any outstanding
Transaction involving a Plan Party.

19.INTENT
(a) The parties recognize that each Transaction is a "repurchase agreement" as
that term is defined in Section 101 of Title 11 of the United States Code, as
amended (except insofar as the type of Securities subject to such Transaction or
the term of such Transaction would render such definition inapplicable), and a
"securities contract" as that term is defined in Section 741 of Title 11 of the
United States Code, as amended (except insofar as the type of assets subject to
such Transaction would render such definition inapplicable).

(b) It is understood that either party's right to liquidate Securities delivered
to it in connection with Transactions hereunder or to exercise any other
remedies pursuant to Paragraph 11 hereof is a contractual right to liquidate
such Transaction as described in Sections 555 and 559 of Title 11 of the United
States Code, as amended.

(c) The parties agree and acknowledge that if a party hereto is an "insured
depository institution," as such term is defined in the Federal Deposit
Insurance Act, as amended ("FDIA"), then each Transaction hereunder is a
"qualified financial contract," as that term is defined in FDIA and any rules,
orders or policy statements thereunder (except insofar as the type of assets
subject to such Transaction would render such definition inapplicable).

(d) It is understood that this Agreement constitutes a "netting contract" as
defined in and subject to Title IV of the Federal Deposit Insurance Corporation
Improvement Act of 1991 ("FDICIA") and each payment entitlement and payment
obligation under any Transaction hereunder shall constitute a "covered
contractual payment entitlement" or "covered contractual payment obligation",
respectively, as defined in and subject to FDICIA (except insofar as one or both
of the parties is not a "financial institution" as that term is defined in
FDICIA).

                                        9

<PAGE>

20.DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS
The parties acknowledge that they have been advised that:

(a) in the case of Transactions in which one of the parties is a broker or
dealer registered with the Securities and Exchange Commission ("SEC") under
Section 15 of the Securities Exchange Act of 1934 ("1934 Act"), the Securities
Investor Protection Corporation has taken the position that the provisions of
the Securities Investor Protection Act of 1970 ("SIPA") do not protect the other
party with respect to any Transaction hereunder;

(b) in the case of Transactions in which one of the parties is a government
securities broker or a government securities dealer registered with the SEC
under Section 15C of the 1934 Act, SIPA will not provide protection to the other
party with respect to any Transaction hereunder; and

(c) in the case of Transactions in which one of the parties is a financial
institution, funds held by the financial institution pursuant to a Transaction
hereunder are not a deposit and therefore are not insured by the Federal Deposit
Insurance Corporation or the National Credit Union Share Insurance Fund, as
applicable.

BANC OF AMERICA SECURITIES LLC                 THE PMI Group, INC.

By: /s/ Roger H. Heintzelman                   By: /s/ Rhoda Rossman
--------------------------------------------------------------------------------
Name: Roger H. Heintzelman                     Name: Rhoda Rossman
--------------------------------------------------------------------------------
Title: Principal                               Title: SVP Treasurer
--------------------------------------------------------------------------------
Date:  4/25/03                                 Date:  4/24/03

                                       10

<PAGE>

                                     ANNEX I
                        SUPPLEMENTAL TERMS AND CONDITIONS

This Annex I forms a part of the Master Repurchase Agreement dated as of April
24, 2003 (the "Agreement") between Banc of America Securities LLC and The PMI
Group, Inc. Capitalized terms used but not defined in this Annex I shall have
the meanings ascribed to them in the Agreement.

1. Other Applicable Annexes. In addition to this Annex I and Annex II, the
following selected Annexes and any Schedules thereto shall form a part of the
Agreement and shall be applicable thereunder:

<TABLE>
   <S>              <C>
   [ ] Annex III    (International Transactions)
   [ ] Annex IV     (Party Acting as Agent (agent, manager, investment adviser or trustee))
   [X] Annex V      (Margin for Forward Transactions)
   [X] Annex VI     (Buy/Sell Back Transactions)
   [ ] Annex VII    (Transactions Involving Registered Investment Companies)
</TABLE>

2. Submission to Jurisdiction and Waiver of Immunity.

   (a) Each party irrevocably and unconditionally (i) submits to the
   non-exclusive jurisdiction of any United States Federal or New York State
   court sitting in Manhattan, and any appellate court from any such court,
   solely for the purpose of any suit, action or proceeding brought to enforce
   its obligations under the Agreement or relating in any way to the Agreement
   or any Transaction under the Agreement and (ii) waives, to the fullest extent
   it may effectively do so, any defense of an inconvenient forum to the
   maintenance of such action or proceeding in any such court and any right of
   jurisdiction on account of its place of residence or domicile.

   (b) To the extent that either party has or hereafter may acquire any immunity
   (sovereign or otherwise) from any legal action, suit or proceeding, from
   jurisdiction of any court or from setoff or any legal process (whether
   service or notice, attachment prior to judgment, attachment in aid of
   execution of judgment, execution of judgment or otherwise) with respect to
   itself or any of its property, such party hereby irrevocably waives and
   agrees not to plead or claim such immunity in respect of any action brought
   to enforce its obligations under the Agreement or relating in any way to the
   Agreement or any Transaction under the Agreement.

3. Additional Events of Default. In addition to the Events of Default set forth
in Paragraph 11 of the Agreement, it shall be an "Event of Default" if:

   (a) as a result of sovereign action or inaction (directly or indirectly),
   Buyer or Seller becomes unable to perform any absolute or contingent
   obligation to make a payment or transfer or to receive a payment or transfer
   in respect of any Transaction under the Agreement or to comply with any other
   material provision of the Agreement relating to such Transaction; or

   (b) either party defaults or becomes subject to an Additional Termination
   Event (as defined in any ISDA Master Agreement) between Counterparty and any
   affiliate of Banc of America Securities LLC with respect to any other
   agreement between the parties or any affiliate of the parties.

                                       11

<PAGE>

4. Representations and Warranties. In addition to the representations and
warranties made pursuant to Paragraph 10 of the Agreement, each party in
addition represents and warrants to the other party that no material adverse
change in such party's financial condition has occurred since the date of the
most recent financial statements furnished by such party to the other party, and
such financial statements are complete and correct and fairly present such
party's financial condition and results of operations as at and for the period
ended on the date thereof, all in accordance with generally accepted accounting
principles and practices applied on a consistent basis.

5. Waiver of Jury Trial. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS
TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

6. No Reliance. In addition to the representations and warranties set forth in
Paragraph 10 of the Agreement, each party hereby makes the following
representations and warranties in connection with the Agreement and each
Transaction under the Agreement, which shall continue until the settlement of
any such Transaction:

     (a) unless there is a written agreement with the other party to the
contrary, it is not relying on any advice (whether written or oral) of the other
party, other than the representations expressly set out in the Agreement;

     (b) it has made and will make its own decisions regarding the entering into
and exercise of any Transaction under the Agreement based upon its own judgment
and upon advice from such professional advisers as it has deemed it necessary to
consult; and

     (c) it understands the terms, conditions and risks of each Transaction
under the Agreement and is willing to assume (financially and otherwise) those
risks.

7. Recording of Conversations. Each party to this Agreement acknowledges and
agrees to the tape recording of conversations between trading and marketing
personnel of the parties to this Agreement whether by one or other or both of
the parties or their agents, and that any such tape recordings may be submitted
in evidence in any proceedings relating to the Agreement.

                                       12

<PAGE>

8. Evidence of Authority. Each party agrees to deliver to the other party the
following documents:-

<TABLE>
<CAPTION>
   PARTY REQUIRED TO DELIVER                                          DATE BY WHICH TO
   DOCUMENT                      FORM/DOCUMENT/CERTIFICATE            BE DELIVERED
   <S>                           <C>                                  <C>
   Both parties                  Certified copies of all              Upon execution and delivery of
                                 corporate authorizations and any     this Agreement
                                 other documents with respect to
                                 the execution, delivery and
                                 performance of this Agreement

   Both parties                  Certificate of authority and         Upon execution and delivery of
                                 specimen signatures of               this Agreement and thereafter
                                 individuals executing this           upon request of the other party
                                 Agreement any Credit Support
                                 Document and Confirmations
</TABLE>

ACCEPTED AND AGREED:

BANC OF AMERICA SECURITIES LLC                 THE PMI Group, INC.

By: /s/ Roger H. Heintzelman                   By: /s/ Rhoda Rossman
--------------------------------------------------------------------------------
Name: Roger H. Heintzelman                     Name: Rhoda Rossman
--------------------------------------------------------------------------------
Title: Principal                               Title: SVP Treasurer
--------------------------------------------------------------------------------
Date:  4/25/03                                 Date:  4/24/03

                                       13

<PAGE>

                                    ANNEX II

             NAMES AND ADDRESSES FOR COMMUNICATIONS BETWEEN PARTIES

CORPORATE HEADQUARTERS:

        Banc of America Securities LLC
        Bank of America Corporate Center
        100 North Tryon Street
        NC1-007-06-06
        Charlotte, North Carolina 28255

DOCUMENTATION ISSUES:

        Banc of America Securities LLC
        429 Berkeley Avenue
        Bloomfield, NJ  07003
        Attn:  Celia M. Bader
        Phone:  973-743-1903
        Fax:  973-743-1904

OPERATIONAL ISSUES:

        Banc of America Securities LLC
        200 North College Street, 3rd Floor
        NC1-004-03-44
        Charlotte, North Carolina 28255
        Attn:  Stuart Baughan, Vice President
        Phone:  (704) 388-4970
        Fax:  (704) 388-5719/5720

________________________________________________________________________________

Name of Party: The PMI Group, Inc.

Contact: Greg Donoven

Street Address: 3003 Oak Road

City, State, Zip Code: Walnut Creek, CA 94597

Telephone No.: 925-658-6248

Fax No.: 925-658-6727

Email address: greg.donoven@pmigroup.com

                                       14

<PAGE>

                                    ANNEX III

                           INTERNATIONAL TRANSACTIONS

This Annex III (including any Schedules hereto) forms a part of the Master
Repurchase Agreement dated as of April 24, 2003 (the "Agreement") between Banc
of America Securities LLC and The PMI Group, Inc. Capitalized terms used but not
defined in this Annex III shall have the meanings ascribed to them in the
Agreement.

1.Definitions.For purposes of the Agreement and this Annex III:
(a)The following terms shall have the following meanings:

         "Base Currency", United States dollars or such other currency as Buyer
and Seller may agree in the Confirmation with respect to any International
Transaction or otherwise in writing;

         "Business Day" or "business day":

         (i) in relation to any International Transaction which (A) involves an
International Security and (B) is to be settled through CEDEL or Euroclear, a
day on which CEDEL or, as the case may be, Euroclear is open to settle business
in the currency in which the Purchase Price and the Repurchase Price are
denominated;

         (ii) in relation to any International Transaction which (A) involves an
International Security and (B) is to be settled through a settlement system
other than CEDEL or Euroclear, a day on which that settlement system is open to
settle such International Transaction;

         (iii) in relation to any International Transaction which involves a
delivery of Securities not falling within (i) or (ii) above, a day on which
banks are open for business in the place where delivery of the relevant
Securities is to be effected; and

         (iv) in relation to any International Transaction which involves an
obligation to make a payment not falling within (i) or (ii) above, a day other
than a Saturday or Sunday on which banks are open for business in the principal
financial center of the country of which the currency in which the payment is
denominated is the official currency and, if different, in the place where any
account designated by the parties for the making or receipt of the payment is
situated (or, in the case of ECU, a day on which ECU clearing operates);

         "CEDEL",CEDEL Bank, societe anonyme;

         "Contractual Currency", the currency in which the International
Securities subject to any International Transaction are denominated or such
other currency as may be specified in the Confirmation with respect to any
International Transaction;

         "Euroclear", Morgan Guaranty Trust Company of New York, Brussels
Branch, as operator of the Euroclear System;

         "International Security", any Security that (i) is denominated in a
currency other than United States dollars or (ii) is capable of being cleared
through a clearing facility outside the United States or (iii) is issued by an
issuer organized under the laws of a jurisdiction other than the United States
(or any political subdivision thereof );

                                       15

<PAGE>

         "International Transaction", any Transaction involving (i) an
International Security or (ii) a party organized under the laws of a
jurisdiction other than the United States (or any political subdivision thereof
) or having its principal place of business outside the United States or (iii) a
branch or office outside the United States designated in Annex I by a party
organized under the laws of the United States (or any political subdivision
thereof ) as an office through which that party may act;

         "LIBOR", in relation to any sum in any currency, the offered rate for
deposits for such sum in such currency for a period of three months which
appears on the Reuters Screen LIBO page as of 11:00 A.M., London time, on the
date on which it is to be determined (or, if more than one such rate appears,
the arithmetic mean of such rates);

         "Spot Rate", where an amount in one currency is to be converted into a
second currency on any date, the spot rate of exchange of a comparable amount
quoted by a major money-center bank in the New York interbank market, as agreed
by Buyer and Seller, for the sale by such bank of such second currency against a
purchase by it of such first currency.

(b) Notwithstanding Paragraph 2 of the Agreement, the term "Prime Rate" shall
mean, with respect to any International Transaction, LIBOR plus a spread, as may
be specified in the Confirmation with respect to any International Transaction
or otherwise in writing.

2. Manner of Transfer. All transfers of International Securities (i) shall be in
suitable form for transfer and accompanied by duly executed instruments of
transfer or assignment in blank (where required for transfer) and such other
documentation as the transferee may reasonably request, or (ii) shall be
transferred through the book-entry system of Euroclear or CEDEL, or (iii) shall
be transferred through any other agreed securities clearing system or (iv) shall
be transferred by any other method mutually acceptable to Seller and Buyer.

3. Contractual Currency.
(a) Unless otherwise mutually agreed, all funds transferred in respect of the
Purchase Price or the Repurchase Price in any International Transaction shall be
in the Contractual Currency.

(b) Notwithstanding subparagraph (a) of this Paragraph 3, the payee of any
payment may, at its option, accept tender thereof in any other currency;
provided, however, that, to the extent permitted by applicable law, the
obligation of the payor to make such payment will be discharged only to the
extent of the amount of the Contractual Currency that such payee may, consistent
with normal banking procedures, purchase with such other currency (after
deduction of any premium and costs of exchange) for delivery within the
customary delivery period for spot transactions in respect of the relevant
currency.

(c) If for any reason the amount in the Contractual Currency so received,
including amounts received after conversion of any recovery under any judgment
or order expressed in a currency other than the Contractual Currency, falls
short of the amount in the Contractual Currency due in respect of the Agreement,
the party required to make the payment shall (unless an Event of Default has
occurred and such party is the nondefaulting party) as a separate and
independent obligation (which shall not merge with any judgment or any payment
or any partial payment or enforcement of payment) and to the extent permitted by
applicable law, immediately pay such additional amount in the Contractual
Currency as may be necessary to compensate for the shortfall.

(d) If for any reason the amount of the Contractual Currency received by one
party hereto exceeds the amount in the Contractual Currency due such party in
respect of the Agreement, then (unless an Event of Default has occurred and such
party is the nondefaulting party) the party receiving the payment shall refund
promptly the amount of such excess.

                                       16

<PAGE>

4. Notices. Any and all notices, statements, demands or other communications
with respect to International Transactions shall be given in accordance with
Paragraph 13 of the Agreement and shall be in the English language.

5. Taxes.
(a) Transfer taxes, stamp taxes and all similar costs with respect to the
    transfer of Securities shall be paid by Seller.

(b)(i) Unless otherwise agreed, all money payable by one party (the "Payor") to
the other (the "Payee") in respect of any International Transaction shall be
paid free and clear of, and without withholding or deduction for, any taxes or
duties of whatsoever nature imposed, levied, collected, withheld or assessed by
any authority having power to tax (a "Tax"), unless the withholding or deduction
of such Tax is required by law. In that event, unless otherwise agreed, Payor
shall pay such additional amounts as will result in the net amounts receivable
by Payee (after taking account of such withholding or deduction) being equal to
such amounts as would have been received by Payee had no such Tax been required
to be withheld or deducted; provided that for purposes of Paragraphs 5 and 6 the
term "Tax" shall not include any Tax that would not have been imposed but for
the existence of any present or former connection between Payee and the
jurisdiction imposing such Tax other than the mere receipt of payment from Payor
or the performance of Payee's obligations under an International Transaction.
The parties acknowledge and agree, for the avoidance of doubt, that the amount
of Income required to be transferred, credited or applied by Buyer for the
benefit of Seller under Paragraph 5 of the Agreement shall be determined without
taking into account any Tax required to be withheld or deducted from such
Income, unless otherwise agreed.

(ii) In the case of any Tax required to be withheld or deducted from any money
payable to a party hereto acting as Payee by the other party hereto acting as
Payor, Payee agrees to deliver to Payor (or, if applicable, to the authority
imposing the Tax) any certificate or document reasonably requested by Payor that
would entitle Payee to an exemption from, or reduction in the rate of,
withholding or deduction of Tax from money payable by Payor to Payee.

(iii) Each party hereto agrees to notify the other party of any circumstance
known or reasonably known to it (other than a Change of Tax Law, as defined in
Paragraph 6 hereof ) that causes a certificate or document provided by it
pursuant to subparagraph (b)(ii) of this Paragraph to fail to be true.

(iv) Notwithstanding subparagraph (b)(i) of this Paragraph, no additional
amounts shall be payable by Payor to Payee in respect of an International
Transaction to the extent that such additional amounts are payable as a result
of a failure by Payee to comply with its obligations under subparagraph (b)(ii)
or (b)(iii) of this Paragraph with respect to such International Transaction.

6. Tax Event.
(a) This Paragraph 6 shall apply if either party notifies the other, with
respect to a Tax required to be collected by withholding or deduction, that:

         (i) any action taken by a taxing authority or brought in a court of
competent jurisdiction after the date an International Transaction is entered
into, regardless of whether such action is taken or brought with respect to a
party to the Agreement; or

         (ii) a change in the fiscal or regulatory regime after the date an
International Transaction is entered into,

         (each, a "Change of Tax Law") has or will, in the notifying party's
reasonable opinion, have a material adverse effect on such party in the context
of an International Transaction.

                                       17

<PAGE>

(b) If so requested by the other party, the notifying party will furnish the
other party with an opinion of a suitably qualified adviser that an event
referred to in subparagraph (a)(i) or (a)(ii) of this Paragraph 6 has occurred
and affects the notifying party.

(c) Where this Paragraph 6 applies, the party giving the notice referred to in
subparagraph (a) above may, subject to subparagraph (d) below, terminate the
International Transaction effective from a date specified in the notice, not
being earlier (unless so agreed by the other party) than 30 days after the date
of such notice, by nominating such date as the Repurchase Date.

(d) If the party receiving the notice referred to in subparagraph (a) of this
Paragraph 6 so elects, it may override such notice by giving a counter-notice to
the other party. If a counter-notice is given, the party which gives such
counter-notice will be deemed to have agreed to indemnify the other party
against the adverse effect referred to in subparagraph (a) of this Paragraph 6
so far as it relates to the relevant International Transaction and the original
Repurchase Date will continue to apply.

(e) Where an International Transaction is terminated as described in this
Paragraph 6, the party which has given the notice to terminate shall indemnify
the other party against any reasonable legal and other professional expenses
incurred by the other party by reason of the termination, but the other party
may not claim any sum constituting consequential loss or damage in respect of a
termination in accordance with this Paragraph 6.

(f) This Paragraph 6 is without prejudice to Paragraph 5 of this Annex III; but
an obligation to pay additional amounts pursuant to Paragraph 5 of this Annex
III may, where appropriate, be a circumstance which causes this Paragraph 6 to
apply.

7. Margin. In the calculation of "Margin Deficit" and "Margin Excess" pursuant
to Paragraph 4 of the Agreement, all sums not denominated in the Base Currency
shall be deemed to be converted into the Base Currency at the Spot Rate on the
date of such calculation.

8. Events of Default.
(a) In addition to the Events of Default set forth in Paragraph 11 of the
Agreement, it shall be an additional "Event of Default" if either party fails,
after one business day's notice, to perform any covenant or obligation required
to be performed by it under this Annex III, including, without limitation, the
payment of taxes or additional amounts as required by Paragraph 5 of this Annex
III.

(b) In addition to the other rights of a nondefaulting party under Paragraph 11
of the Agreement, following an Event of Default, the nondefaulting party may, at
any time at its option, effect the conversion of any currency into a different
currency of its choice at the Spot Rate on the date of the exercise of such
option and offset obligations of the defaulting party denominated in different
currencies against each other.

                                       18

<PAGE>

SCHEDULE III.A

INTERNATIONAL TRANSACTIONS RELATING TO [Relevant Country]

This Schedule III.A forms a part of Annex III to the Master Repurchase Agreement
dated as of April 24, 2003 (the "Agreement") between Banc of America Securities
LLC and The PMI Group, Inc. Capitalized terms used but not defined in this
Schedule III.A shall have the meanings ascribed to them in Annex III.

        Insert provisions applicable to relevant country: Not Applicable.

                                       19

<PAGE>

                                    ANNEX IV

                              PARTY ACTING AS AGENT

This Annex IV forms a part of the Master Repurchase Agreement dated as of April
24, 2003 (the "Agreement") between Banc of America Securities LLC and The PMI
Group, Inc. This Annex IV sets forth the terms and conditions governing all
transactions in which a party selling securities or buying securities, as the
case may be ("Agent"), in a Transaction is acting as agent for one or more third
parties (each, a "Principal").  Capitalized terms used but not defined in this
Annex IV shall have the meanings ascribed to them in the Agreement.

1.Additional Representations. In addition to the representations set forth in
Paragraph 10 of the Agreement, Agent hereby makes the following representations,
which shall continue during the term of any Transaction: Principal has duly
authorized Agent to execute and deliver the Agreement on its behalf, has the
power to so authorize Agent and to enter into the Transactions contemplated by
the Agreement and to perform the obligations of Seller or Buyer, as the case may
be, under such Transactions, and has taken all necessary action to authorize
such execution and delivery by Agent and such performance by it.

2.Identification of Principals. Agent agrees (a) to provide the other party,
prior to the date on which the parties agree to enter into any Transaction under
the Agreement, with a written list of Principals for which it intends to act as
Agent (which list may be amended in writing from time to time with the consent
of the other party), and (b) to provide the other party, before the close of
business on the next business day after orally agreeing to enter into a
Transaction, with notice of the specific Principal or Principals for whom it is
acting in connection with such Transaction. If (i) Agent fails to identify such
Principal or Principals prior to the close of business on such next business day
or (ii) the other party shall determine in its sole discretion that any
Principal or Principals identified by Agent are not acceptable to it, the other
party may reject and rescind any Transaction with such Principal or Principals,
return to Agent any Purchased Securities or portion of the Purchase Price, as
the case may be, previously transferred to the other party and refuse any
further performance under such Transaction, and Agent shall immediately return
to the other party any portion of the Purchase Price or Purchased Securities, as
the case may be, previously transferred to Agent in connection with such
Transaction; provided, however, that (A) the other party shall promptly (and in
any event within one business day) notify Agent of its determination to reject
and rescind such Transaction and (B) to the extent that any performance was
rendered by any party under any Transaction rejected by the other party, such
party shall remain entitled to any Price Differential or other amounts that
would have been payable to it with respect to such performance If such
Transaction had not been rejected. The other party acknowledges that Agent shall
not have any obligation to provide it with confidential information regarding
the financial status of its Principals; Agent agrees, however, that it will
assist the other party in obtaining from Agent's Principals such information
regarding the financial status of such Principals as the other party may
reasonably request.

3.Limitation of Agent's Liability. The parties expressly acknowledge that if the
representations of Agent under the Agreement, Including this Annex IV, are true
and correct in all material respects during the term of any Transaction and
Agent otherwise complies with the provisions of this Annex IV, then (a) Agent's
obligations under the Agreement shall not include a guarantee of performance by
its Principal or Principals and (b) the other party's remedies shall not include
a right of setoff in respect of rights or obligations, if any, of Agent arising
in other transactions in which Agent is acting as principal.

                                       20

<PAGE>

4. Multiple Principals.
(a) In the event that Agent proposes to act for more than one Principal
hereunder, Agent and the other party shall elect whether (i) to treat
Transactions under the Agreement as transactions entered into on behalf of
separate Principals or (ii) to aggregate such Transactions as if they were
transactions by a single Principal. Failure to make such an election in writing
shall be deemed an election to treat Transactions under the Agreement as
transactions on behalf of separate Principals.

(b) In the event that Agent and the other party elect (or are deemed to elect)
to treat Transactions under the Agreement as transactions on behalf of separate
Principals, the parties agree that (i) Agent will provide the other party,
together with the notice described in Paragraph 2(b) of this Annex IV, notice
specifying the portion of each Transaction allocable to the account of each of
the Principals for which it is acting (to the extent that any such Transaction
is allocable to the account of more than one Principal); (ii) the portion of any
individual Transaction allocable to each Principal shall be deemed a separate
Transaction under the Agreement; (iii) the margin maintenance obligations of
Buyer and Seller under Paragraph 4 of the Agreement shall be determined on a
Transaction-by-Transaction basis (unless the parties agree to determine such
obligations on a Principal-by-Principal basis); and (iv) Buyer's and Seller's
remedies under the Agreement upon the occurrence of an Event of Default shall be
determined as if Agent had entered into a separate Agreement with the other
party on behalf of each of its Principals.

(c) In the event that Agent and the other party elect to treat Transactions
under the Agreement as if they were transactions by a single Principal, the
parties agree that (i) Agent's notice under Paragraph 2(b) of this Annex IV need
only identify the names of its Principals but not the portion of each
Transaction allocable to each Principal's account; (ii) the margin maintenance
obligations of Buyer and Seller under Paragraph 4 of the Agreement shall,
subject to any greater requirement imposed by applicable law, be determined on
an aggregate basis for all Transactions entered into by Agent on behalf of any
Principal; and (iii) Buyer's and Seller's remedies upon the occurrence of an
Event of Default shall be determined as if all Principals were a single Seller
or Buyer, as the case may be.

(d) Notwithstanding any other provision of the Agreement (including, without
limitation, this Annex IV), the parties agree that any Transactions by Agent on
behalf of an employee benefit plan under ERISA shall be treated as Transactions
on behalf of separate Principals in accordance with Paragraph 4(b) of this Annex
IV (and all margin maintenance obligations of the parties shall be determined on
a Transaction-by-Transaction basis).

5. Interpretation of Terms. All references to "Seller" or "Buyer", as the case
may be, in the Agreement shall, subject to the provisions of this Annex IV
(including, among other provisions, the limitations on Agent's liability in
Paragraph 3 of this Annex IV), be construed to reflect that (i) each Principal
shall have, in connection with any Transaction or Transactions entered into by
Agent on its behalf, the rights, responsibilities, privileges and obligations of
a "Seller" or "Buyer", as the case may be, directly entering into such
Transaction or Transactions with the other party under the Agreement, and (ii)
Agent's Principal or Principals have designated Agent as their sole agent for
performance of Seller's obligations to Buyer or Buyer's obligations to Seller,
as the case may be, and for receipt of performance by Buyer of its obligations
to Seller or Seller of its obligations to Buyer, as the case may be, in
connection with any Transaction or Transactions under the Agreement (including,
among other things, as Agent for each Principal in connection with transfers of
Securities, cash or other property and as agent for giving and receiving all
notices under the Agreement). Both Agent and its Principal or Principals shall
be deemed "parties" to the Agreement and all references to a "party" or "either
party" in the Agreement shall be deemed revised accordingly (and any Act of
Insolvency with respect to Agent or any other Event of Default by Agent under
Paragraph 11 of the Agreement shall be deemed an Event of Default by Seller or
Buyer, as the case may be).

                                       21

<PAGE>

                                   ANNEX IV.A

                          IDENTIFICATION OF PRINCIPALS

                                       22

<PAGE>

                                     ANNEX V

                         MARGIN FOR FORWARD TRANSACTIONS

This Annex V forms a part of the Master Repurchase Agreement dated as of April
24, 2003 (the "Agreement") between Banc of America Securities LLC and The PMI
Group, Inc.Capitalized terms used but not defined in this Annex V shall have the
meanings ascribed to them in the Agreement.

1.Definitions. For purposes oft he Agreement and this Annex V, the following
terms shall have the following meanings:

"Forward Exposure", the amount of loss a party would incur upon canceling a
Forward Transaction and entering into a replacement transaction, determined in
accordance with market practice or as otherwise agreed by the parties;

"Forward Transaction", any Transaction agreed to by the parties as to which the
Purchase Date has not yet occurred;

"Net Forward Exposure", the aggregate amount of a party's Forward Exposure to
the other party under all Forward Transactions hereunder reduced by the
aggregate amount of any Forward Exposure of the other party to such party under
all Forward Transactions hereunder;

"Net Unsecured Forward Exposure", a party's Net Forward Exposure reduced by the
Market Value of any Forward Collateral transferred to such party (and not
returned) pursuant to Paragraph 2 of this Annex V.

2.Margin Maintenance.
(a) If at any time a party (the "In-the-Money Party") shall have a Net Unsecured
Forward Exposure to the other party (the "Out-of-the-Money Party") under one or
more Forward Transactions, the In-the-Money Party may by notice to the
Out-of-the-Money Party require the Out-of-the-Money Party to transfer to the
In-the-Money Party Securities or cash reasonably acceptable to the
In-the-Money-Party (together with any Income thereon and proceeds there of,
"Forward Collateral") having a Market Value sufficient to eliminate such Net
Unsecured Forward Exposure. The Out-of-the-Money Party may by notice to the
In-the-Money Party require the In-the-Money Party to transfer to the
Out-of-the-Money Party Forward Collateral having a Market Value that exceeds the
In-the-Money Party's Net Forward Exposure ("Excess Forward Collateral
Amount").The rights of the parties under this subparagraph shall be in addition
to their rights under subparagraphs (a) and (b) of Paragraph 4 and any other
provisions of the Agreement.

(b) The parties may agree, with respect to any or all Forward Transactions
hereunder, that the respective rights of the parties under subparagraph (a) of
this Paragraph may be exercised only where a Net Unsecured Forward Exposure or
Excess Forward Collateral Amount, as the case may be, exceeds a specified dollar
amount or other specified threshold for such Forward Transactions (which amount
or threshold shall be agreed to by the parties prior to entering into any such
Forward Transactions).

(c) The parties may agree, with respect to any or all Forward Transactions
hereunder, that the respective rights of the parties under subparagraph (a) of
this Paragraph to require the elimination of a Net Unsecured Forward Exposure or
Excess Forward Collateral Amount, as the case may be, may be exercised whenever
such a Net Unsecured Forward Exposure or Excess Forward Collateral Amount exists
with respect to any single Forward Transaction hereunder (calculated without
regard to any other Forward Transaction outstanding hereunder).

                                       23

<PAGE>

(d) The parties may agree, with respect to any or all Forward Transactions
hereunder, that (i) one party shall transfer to the other party Forward
Collateral having a Market Value equal to a specified dollar amount or other
specified threshold no later than the Margin Notice Deadline on the day such
Forward Transaction is entered into by the parties or (ii) one party shall not
be required to make any transfer otherwise required to be made under this
Paragraph if, after giving effect to such transfer, the Market Value of the
Forward Collateral held by such party would be less than a specified dollar
amount or other specified threshold (which amount or threshold shall be agreed
to by the parties prior to entering into any such Forward Transactions).

(e) If any notice is given by a party to the other under subparagraph (a) of
this Paragraph at or before the Margin Notice Deadline on any business day, the
party receiving such notice shall transfer Forward Collateral as provided in
such subparagraph no later than the close of business in the relevant market on
such business day. If any such notice is given after the Margin Notice Deadline,
the party receiving such notice shall transfer such Forward Collateral no later
than the close of business in the relevant market on the next business day.

(f) Upon the occurrence of the Purchase Date for any Forward Transaction and the
performance by the parties of their respective obligations to transfer cash and
Securities on such date, any Forward Collateral in respect of such Forward
Transaction, together with any Income thereon and proceeds thereof, shall be
transferred by the party holding such Forward Collateral to the other party;
provided, however, that neither party shall be required to transfer such Forward
Collateral to the other if such transfer would result in the creation of a Net
Unsecured Forward Exposure of the transferor.

(g) The Pledgor (as defined below) of Forward Collateral may, subject to
agreement with and acceptance by the Pledgee (as defined below) thereof,
substitute other Securities reasonably acceptable to the Pledgee for any
Securities Forward Collateral. Such substitution shall be made by transfer to
the Pledgee of such other Securities and transfer to the Pledgor of such
Securities Forward Collateral. After substitution, the substituted Securities
shall constitute Forward Collateral.

3. Security Interest.
(a) In addition to the rights granted to the parties under Paragraph 6 of the
Agreement, each party ("Pledgor") hereby pledges to the other party ("Pledgee")
as security for the performance of its obligations hereunder, and grants Pledgee
a security interest in and right of setoff against, any Forward Collateral and
any other cash, Securities or property, and all proceeds of any of the
foregoing, transferred by or on behalf of Pledgor to Pledgee or due from Pledgee
to Pledgor in connection with the Agreement and the Forward Transactions
hereunder.

(b) Unless otherwise agreed by the parties, a party to whom Forward Collateral
has been transferred shall have the right to engage in repurchase transactions
with Forward Collateral or otherwise sell, transfer, pledge or hypothecate
Forward Collateral, including in respect of loans or other extensions of credit
to such party that may be in amounts greater than the Forward Collateral such
party is entitled to as security for obligations hereunder, and that may extend
for periods of time longer than the periods during which such party is entitled
to Forward Collateral as security for obligations hereunder; provided, however,
that no such transaction shall relieve such party of its obligations to transfer
Forward Collateral pursuant to Paragraph 2 or 4 of this Annex V or Paragraph 11
of the Agreement.

4. Events of Default.
(a) In addition to the Events of Default set forth in Paragraph 11 of the
Agreement, it shall be an additional "Event of Default" if either party fails,
after one business day's notice, to perform any covenant or obligation required
to be performed by it under Paragraph 2 or any other provision of this Annex.

                                       24

<PAGE>

(b) In addition to the other rights of a nondefaulting party under Paragraphs 11
and 12 of the Agreement, if the nondefaulting party exercised or is deemed to
have exercised the option referred to in Paragraph 11(a) of the Agreement:

         (i) The nondefaulting party, without prior notice to the defaulting
party, may (A) immediately sell, in a recognized market (or otherwise in a
commercially reasonable manner) at such price or prices as the nondefaulting
party may reasonably deem satisfactory, any or all Forward Collateral subject to
any or all Forward Transactions hereunder and apply the proceeds thereof to any
amounts owing by the defaulting party hereunder or (B) in its sole discretion
elect, in lieu of selling all or a portion of such Forward Collateral, to give
the defaulting party credit for such Forward Collateral in an amount equal to
the price therefor on such date, obtained from a generally recognized source or
the most recent closing bid quotation from such a source, against any amounts
owing by the defaulting party hereunder.

         (ii) Any Forward Collateral held by the defaulting party, together with
any Income thereon and proceeds thereof, shall be immediately transferred by the
defaulting party to the nondefaulting party. The nondefaulting party may, at its
option (which option shall be deemed to have been exercised immediately upon the
occurrence of an Act of Insolvency), and without prior notice to the defaulting
party, (i) immediately purchase, in a recognized market (or otherwise in a
commercially reasonable manner) at such price or prices as the nondefaulting
party may reasonably deem satisfactory, securities ("Replacement Securities") of
the same class and amount as any Securities Forward Collateral that is not
delivered by the defaulting party to the nondefaulting party as required
hereunder or (ii) in its sole discretion elect, in lieu of purchasing
Replacement Securities, to be deemed to have purchased Replacement Securities at
the price therefor on such date, obtained from a generally recognized source or
the most recent closing offer quotation from such a source, whereupon the
defaulting party shall be liable for the price of such Replacement Securities
together with the amount of any cash Forward Collateral not delivered by the
defaulting party to the nondefaulting party as required hereunder.

Unless otherwise provided in Annex I, the parties acknowledge and agree that (1)
the Forward Collateral subject to any Forward Transaction hereunder are
instruments traded in a recognized market, (2) in the absence of a generally
recognized source for prices or bid quotations for any Forward Collateral, the
nondefaulting party may establish the source therefor in its sole discretion and
(3) all prices and bids shall be determined together with accrued Income (except
to the extent contrary to market practice with respect to the relevant Forward
Collateral).

5. No Waivers, Etc. Without limitation of the provisions of Paragraph 17 of the
Agreement, the failure to give a notice pursuant to subparagraph (a), (b), (c)
or (d) of Paragraph 2 of this Annex V will not constitute a waiver of any right
to do so at a later date.

                                       25

<PAGE>

                                    ANNEX VI

                           BUY/SELL BACK TRANSACTIONS

This Annex VI forms a part of the Master Repurchase Agreement dated as of April
24, 2003 (the "Agreement") between Banc of America Securities LLC and The PMI
Group, Inc. Capitalized terms used but not defined in this Annex VI shall have
the meanings ascribed to them in the Agreement.

1. In the event of any conflict between the terms of this Annex VI and any other
term of the Agreement, the terms of this Annex VI shall prevail.

2. Each Transaction shall be identified at the time it is entered into and in
the relevant Confirmation as either a Repurchase Transaction or a Buy/Sell Back
Transaction.

3. In the case of a Buy/Sell Back Transaction, the Confirmation delivered in
accordance with Paragraph 3 of the Agreement may consist of a single document in
respect of both of the transfers of funds against Securities which together form
the Buy/Sell Back Transaction or separate Confirmations may be delivered in
respect of each such transfer.

4. Definitions. The following definitions shall apply to Buy/Sell Back
Transactions:

(a) "Accrued Interest", with respect to any Purchased Securities subject to a
Buy/Sell Back Transaction, unpaid Income that has accrued during the period from
(and including) the issue date or the last Income payment date (whichever is
later) in respect of such Purchased Securities to (but excluding) the date of
calculation. For these purposes unpaid Income shall be deemed to accrue on a
daily basis from (and including) the issue date or the last Income payment date
(as the case may be) to (but excluding) the next Income payment date or the
maturity date (whichever is earlier);

(b) "Sell Back Differential", with respect to any Buy/Sell Back Transaction as
of any date, the aggregate amount obtained by daily application of the Pricing
Rate for such Buy/Sell Back Transaction to the Purchase Price for such Buy/Sell
Back Transaction on a 360 day per year basis (unless otherwise agreed by the
parties for the Transaction) for the actual number of days during the period
commencing on (and including) the Purchase Date for such Buy/Sell Back
Transaction and ending on (but excluding) the date of determination;

(c) "Sell Back Price", with respect to any Buy/Sell Back Transaction:

         (i) in relation to the date originally specified by the parties as the
Repurchase Date pursuant to Paragraph 2(q) of the Agreement, the price agreed by
the Parties in relation to such Buy/Sell Back Transaction, and

         (ii) in any other case (including for the purposes of the application
of Paragraph 4 or Paragraph 11 of the Agreement), the product of the formula
(P + D) - (IR + C), where --

P = the Purchase Price.

D = the Sell Back Differential

IR = the amount of any Income in respect of the Purchased Securities paid by the
issuer on any date falling between the Purchase Date and the Repurchase Date

                                       26

<PAGE>

C = the aggregate amount obtained by daily application of the Pricing Rate for
such Buy/Sell Back Transaction to any such Income from (and including) the date
of payment by the issuer to (but excluding) the date of calculation.

5. When entering into a Buy/Sell Back Transaction the parties shall also agree
on the Sell Back Price and the Pricing Rate to apply in relation to such
Buy/Sell Back Transaction on the scheduled Repurchase Date. The parties shall
record the Pricing Rate in at least one Confirmation applicable to such Buy/Sell
Back Transaction.

6. Termination of a Buy/Sell Back Transaction shall be effected on the
Repurchase Date by transfer to Seller or its agent of Purchased Securities
against the payment by Seller of (i) in a case where the Repurchase Date is the
date originally agreed to by the parties pursuant to Paragraph 2(q) of the
Agreement, the Sell Back Price referred to in Paragraph 4(c)(i) of this Annex;
and (ii) in any other case, the Sell Back Price referred to in Paragraph
4(c)(ii) of this Annex.

7. For the avoidance of doubt, the parties acknowledge and agree that the
Purchase Price and the Sell Back Price in Buy/Sell Back Transactions shall
include Accrued Interest (except to the extent contrary to market practice with
respect to the Securities subject to such Buy/Sell Back Transaction, in which
event (i) an amount equal to the Purchase Price plus Accrued Interest to the
Purchase Date shall be paid to Seller on the Purchase Date and shall be used, in
lieu of the Purchase Price, for calculating the Sell Back Differential, (ii) an
amount equal to the Sell Back Price plus the amount of Accrued Interest to the
Repurchase Date shall be paid to Buyer on the Repurchase Date, and (iii) the
formula in Paragraph 4(c)(ii) of this Annex VI shall be replaced by the formula
"(P + AI + D) - (IR + C)", where "AI" equals Accrued Interest to the Purchase
Date).

8. Unless the parties agree in Annex I to the Agreement that a Buy/Sell Back
Transaction is not to be repriced, they shall at the time of repricing agree on
the Purchase Price, the Sell Back Price and the Pricing Rate applicable to such
Transaction.

9. Paragraph 5 of the Agreement shall not apply to Buy/Sell Back Transactions.
Seller agrees, on the date such Income is received, to pay to Buyer any Income
received by Seller in respect of Purchased Securities that is paid by the issuer
on any date falling between the Purchase Date and the Repurchase Date.

10. References to "Repurchase Price" throughout the Agreement shall be construed
as references to "Repurchase Price or the Sell Back Price, as the case may be."

11. In 11 of the Agreement, references to the "Repurchase Prices" shall be
construed as reference to "Repurchase Prices and Sell Back Prices."

                                       27

<PAGE>

                                    ANNEX VII

             TRANSACTIONS INVOLVING REGISTERED INVESTMENT COMPANIES

This Annex VII (including any Schedules hereto) forms a part of the Master
Repurchase Agreement dated as of April 24, 2003 (the "Agreement") between Banc
of America Securities LLC ("Counterparty") and each investment company
identified on Schedule VII.A hereto (as such schedule may be amended from time
to time) acting on Behalf of its respective series or portfolios identified on
such Schedule VII.A, or in the case of those investment companies for which no
separate series or portfolios are identified on such Schedule VII.A, acting for
and on behalf of itself(each such series, portfolio or investment company, as
the case may be, hereinafter referred to as a "Fund").In the event of any
conflict between the terms of this Annex VII and any other term of the
Agreement, the terms of this Annex VII shall prevail. Capitalized terms used but
not defined in this Annex VII shall have the meanings ascribed to them in the
Agreement.

1.Multiple Funds. For any Transaction in which a Fund is acting as Buyer (or
Seller, as the case may be),each reference in the Agreement and this Annex VII
to Buyer (or Seller, as the case may be) shall be deemed a reference solely to
the particular Fund to which such Transaction relates, as identified to Seller
(or Buyer, as the case may be) by the Fund and as may be specified in the
Confirmation therefor. In no circumstances shall the rights, obligations or
remedies of either party with respect to a particular Fund constitute a right,
obligation or remedy applicable to any other Fund. Specifically, and without
otherwise limiting the scope of this Paragraph:(a) the margin maintenance
obligations of Buyer and Seller specified in Paragraph 4 or any other provisions
of the Agreement and the single agreement provisions of Paragraph 12 of the
Agreement shall be applied based solely upon Transactions entered into by a
particular Fund,(b) Buyer's and Seller's remedies under the Agreement upon the
occurrence of an Event of Default shall be determined as if each Fund had
entered into a separate Agreement with Counterparty, and (c) Seller and Buyer
shall have no right to set off claims related to Transactions entered into by a
particular Fund against claims related to Transactions entered into by any other
Fund.

2.Margin Percentage. For any Transaction in which a Fund is acting as Buyer, the
Buyer's Margin Percentage shall always be equal to at least ___%,or such other
percentage as the parties hereto may from time to time mutually determine;
provided, that in no event shall such percentage be less than 100%.For any
Transaction in which a Fund is acting as Seller, the Buyer's Margin Percentage
shall be such percentage as the parties hereto may from time to time mutually
determine; provided, that in no event shall such percentage be less than 100%.

3.Confirmations. Unless otherwise agreed, Counterparty shall promptly issue a
Confirmation to the Fund pursuant to Paragraph 3 of the Agreement. Upon the
transfer of substituted or Additional Purchased Securities by either party,
Counterparty shall promptly provide notice to the Fund confirming such transfer.

4.Financial Condition. Each party represents that it has delivered the following
financial information to the other party to the Agreement: in the case of a
party that is a registered broker-dealer, its most recent statements required to
be furnished to customers by Rule 17a- 5(c) under the 1934 Act; in the case of a
party that is a Fund, its most recent audited or unaudited financial statements
required to be furnished to its shareholders by Rule 30d-1 under the Investment
Company Act of 1940; in the case of any other party, its most recent audited or
unaudited statements of financial condition or other comparable information
concerning its financial condition.

Each party represents that the financial statements or information so delivered
fairly reflect its financial condition and, if applicable, its net capital
ratio, on the date as of which such financial statements or

                                       28

<PAGE>

information were prepared. Each party agrees that it will make available and
deliver to the other party, promptly upon request, all such financial statements
that subsequently are required to be delivered to its customers or shareholders
pursuant to Rule 17a-5(c) or Rule 30d-1, as the case may be, or, in the case of
a party that is neither a registered broker-dealer nor a Fund, all such
financial information that subsequently becomes available to the public.

Each Fund acknowledges and agrees that it has made an independent evaluation of
the creditworthiness of the other party that is required pursuant to the
Investment Company Act of 1940 or the regulations thereunder. Each Fund agrees
that its agreement to enter into each Transaction hereunder shall constitute an
acknowledgment and agreement that it has made such an evaluation.

5. Segregation of Purchased Securities. Unless otherwise agreed by the parties,
any transfer of Purchased Securities to a Fund shall be effected by delivery or
other transfer (in the manner agreed upon pursuant to Paragraph 7 of the
Agreement) to the custodian or subcustodian designated for such Fund in Schedule
VII.A hereto ("Custodian") for credit to the Fund's custodial account with such
Custodian. If the party effecting such transfer is the Fund's Custodian, such
party shall, unless otherwise directed by the Fund, (a) transfer and maintain
such Purchased Securities to and in the Fund's custodial account with such party
and (b) so indicate in a notice to the Fund.

                                       29

<PAGE>

SCHEDULE VII.A

SUPPLEMENTAL TERMS AND CONDITIONS OF TRANSACTIONS
INVOLVING REGISTERED INVESTMENT COMPANIES

This Schedule VII.A forms a part of Annex VII to the Master Repurchase Agreement
dated as of April 24, 2003 (the "Agreement") between Banc of America Securities
LLC and The PMI Group, Inc.Capitalized terms used but not defined in this
Schedule VII.A shall have the meanings ascribed to them in Annex VII.

1. This Agreement is entered into by or on behalf of the following Funds, and
unless otherwise indicated by the appropriate Fund in connection with a
Transaction ,the following Custodians are designated to receive transfers of
Purchased Securities on behalf of such Funds for credit to the appropriate
Fund's custodial account:

Name of Fund                                Custodian
------------                                ---------

The PMI Group, Inc.                         Bank of New York DTC 901
                                            550 Kearny St. 600 ABA 021000018
                                            San Francisco, CA 94108
                                            (415) 263-2034

[ ].Limitation of Liability. If the Fund is organized as a business trust (or a
series thereof), the parties agree as follows:[insert appropriate language
limiting liability of trustees, officers and others].

40 Broad Street
New York, NY 10004-2373
Telephone 212.440.9400
Fax 212.440.5260
www.bondmarkets.co

                                       30

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