Document:

Exhibit
10.5

 

EXECUTION
COPY

 

 

AMENDED AND RESTATED

 

LIMITED LIABILITY COMPANY OPERATING AGREEMENT

 

OF

 

PILOT GROUP TV LLC

 

 

Dated as of December 30, 2003

 

 

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY OPERATING AGREEMENT

OF

PILOT GROUP TV  LLC

 

This AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF PILOT
GROUP TV LLC, a Delaware limited liability company (the “Company”),
dated as of December 30, 2003 (this “Agreement”), is entered into by and
among Pilot Group LP, a Delaware limited partnership (“Pilot”), and
Barrington Broadcasting Company, LLC, a Delaware limited liability
company (“Barrington”). Pilot,
Barrington and the Managing Member (as designated from time to time by Pilot in
accordance with Section 3.1 hereof), in their capacities as members of the
Company, and each other Person (as defined herein) who acquires a membership
interest in the Company and executes and delivers a counterpart signature page
to this Agreement, are each referred to herein individually as a “Member”
and collectively as the “Members”.

 

RECITALS:

 

WHEREAS, the Company was formed as a limited
liability company pursuant to and in accordance with the Delaware Limited
Liability Company Act (6 Del. C. §18-101, et seq.), as
amended from time to time (the “Act”), by the filing of a Certificate of
Formation in the Office of the Secretary of State of the State of Delaware on
October 17, 2003 and the entering into a limited liability company operating
agreement, dated as of October 17, 2003 (the “Original Agreement”), by
Pilot, as the sole member of the Company.

 

WHEREAS, the Company has entered into a Management
Agreement with Barrington, dated as of December 30, 2003 (the “Management
Agreement”).

 

WHEREAS,
the Members desire to amend and restate the Original Agreement in its entirety
and enter into certain agreements with regard to the management, operation and
ownership of the Company and certain other matters upon and subject to the
terms and conditions set forth in this Agreement.

 

NOW,
THEREFORE, in consideration of the agreements and covenants herein contained,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and intending to be legally bound hereby, Pilot
agrees to amend and restate the Original Agreement in its entirety by executing
this Agreement, and the parties hereto hereby enter into this Agreement, so as
to agree with each other as follows:

 

 

ARTICLE
I

 

THE
COMPANY

 

SECTION 1.1.        Formation; Company Name. The
Company has previously been formed under the name “Pilot Group TV LLC” as a
limited liability company under the Act. The Members hereby agree to continue
the Company under such name. All business of the Company shall be conducted
under such name and such name shall be used at all times in connection with the
Company’s business and affairs. After the execution of this Agreement, the
Members shall promptly execute, file and record with the proper offices in the
State of Delaware such certificates, and shall cause to be made such
publications, as shall be required by the Act.

 

SECTION 1.2.        Place of Business. The principal
place of business of the Company shall be at such place or places as the
Managing Member (as defined herein) may designate.

 

SECTION 1.3.        Purposes and Powers of the Company.
The business and purpose of the Company shall be to: (a) manage, operate, hold,
sell, dispose of, exchange, transfer, vote or otherwise exercise all rights,
powers, privileges and other incidents of ownership or possession with respect
to the Company’s property and (b) engage in any other business as agreed to by
each of the Members. The Company shall have full power to transfer, mortgage,
pledge, sell or otherwise deal with its property and exercise all rights,
powers, privileges and other incidents of ownership or possession with respect
thereto. The Company may borrow and raise money from time to time; accept,
endorse and execute notes, drafts, bills of exchange and evidences of
indebtedness of all kinds, with or without security; and, to the extent that
such security includes letters of credit, to secure the repayment of any
drawings thereunder. The Company may maintain one or more offices within or
outside the State of Delaware and engage personnel for the conduct of the
Company’s activities. The Company may enter into, make and perform contracts,
agreements and undertakings of all kinds as may be necessary, advisable or
incidental to the carrying out of its purposes. In addition to the powers
specified above, the Company shall have the power to do all and everything necessary,
suitable or proper for the accomplishment of or in furtherance of any of the
purposes set forth herein, and to do every other act or acts, thing or things,
incidental or appurtenant to or arising from or connected with any of such
purposes; provided, however, that nothing set forth herein shall
be construed as authorizing the Company to possess any purpose or power, or to
do any act or thing, forbidden by law to a limited liability company organized
under the Act.

 

SECTION 1.4.        Term. The Company shall continue
indefinitely until the earliest of: (a) the date upon which the Company is
dissolved by the Managing Member and (b) the date upon which shall occur any
other circumstance that, by law or this Agreement, would require that the
Company be terminated.

 

2

 

ARTICLE II

 

LIMITATION OF
LIABILITY; MEMBERSHIP INTERESTS,

CAPITAL CONTRIBUTIONS

 

SECTION 2.1.        Limitation of Liability. Except
as otherwise provided herein, the liability of the Members to the Company shall
be limited to the amount of their capital contributions to the Company.

 

SECTION 2.2.        Membership Interests. The Members’
respective membership interests in the Company (each Member’s “Membership
Interest”) shall be expressed as a percentage interest in the Company and
shall be as follows:

 

	
  Member

  	
   

  	
  Membership Interest

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Pilot

  	
   

  	
  100

  	
  %

  

 

Neither the Managing
Member (as defined herein) nor Barrington shall have a Membership Interest.

 

SECTION 2.3.        Capital Contributions. (a)  Prior to or after the date hereof, (i) Pilot
shall make a capital contribution to the Company of $48.5 million and (ii) the
Company shall make a capital contribution to certain of its subsidiaries in
connection with the acquisition of the WHOITV, KHQATV and WEYITV television
stations by such subsidiaries.

 

(b)           In the event that the Managing Member
determines that additional capital should be contributed to the Company, Pilot
shall make a capital contribution equal to the aggregate amount that the
Managing Member determines should be contributed to the Company. Except as
otherwise provided in this Section, no Member shall be obligated to make any
contribution of capital to the Company.

 

(c)           The provisions of this Section are
not intended to be for the benefit of any creditor or other Person (other than
a Member in its capacity as a Member) to whom any debts, liabilities or
obligations are owed by, or who otherwise has any claim against, the Company or
any of the Members; and no such creditor or other person shall obtain any right
under any such provision or by reason of any such liability, obligation or
otherwise against the Company or any of the Members.

 

SECTION 2.4.        Withdrawal of Capital; Redemption of
Membership Interests. Except as otherwise provided in this Agreement, no
Member shall have the right to withdraw its capital in the Company or require
that the Company redeem such Member’s Membership Interest, in whole or in part,
prior to the dissolution and winding up of the affairs of the Company without
the prior written consent of the Managing Member.

 

3

 

SECTION 2.5.        Uncertificated Interests. Membership
Interests will be recorded in book-entry form and no Member will have the right
to demand that the Company produce and/or deliver certificates representing any
Membership Interest. Without limiting the foregoing, the Managing Member may,
in its discretion, cause the Company to produce and deliver certificates
representing the Membership Interests.

 

ARTICLE
III

 

MANAGEMENT

 

SECTION 3.1.        Management Generally. The
managing member of the Company (the “Managing Member”) shall be
designated from time to time by Pilot. Pilot has initially designated Pilot
Group GP LLC as the Managing Member. The management, operation and control of
the Company and its business shall be vested exclusively in the Managing
Member, subject to the terms and provisions of this Agreement. The Managing
Member shall, in its sole discretion, exercise all powers necessary and
convenient for the purposes of the Company and all of the power conferred by
the Act on the manager of a limited liability company, including the powers to
conduct the Company’s business as described in Section 1.3 hereof, and the
power to delegate to one or more Persons the power to perform any of the acts
described above but subject to the limitations and restrictions expressly set
forth in this Agreement. The Managing Membershall
be a “manager” within the meaning of the Act. Each successor Managing Member,
if any, as a condition to its admission as a Member, shall execute and deliver
a counterpart signature
page to this Agreement.

 

SECTION 3.2.        Officers. (a)  The Managing Member may, in its sole
discretion, from time to time appoint officers of the Company, including, but
not limited to, a president, one or more vice presidents (each of whom may be
designated as an executive vice president, a senior vice president or a vice
president with a particular area of responsibility), a treasurer, one or more
assistant treasurers, a secretary and one or more assistant secretaries, each
of which shall have such rights, powers and authority as provided in this
Section and as the Managing Member may, in its sole discretion, from time to
time delegate to any such officer.

 

(b)           Each officer of the Company may be
appointed for an indefinite term; provided, however, that each
officer will be deemed removed upon such officer’s death or Disability and; provided,
further, that the Managing Member may, in its sole discretion, at any
time remove and replace any officer. Each such officer will be designated a “manager”
within the meaning of the Act. The Managing Member may, in its sole discretion,
appoint a replacement president, vice president, treasurer, assistant
treasurer, secretary or assistant secretary upon the removal, death,
Disability, retirement or any other circumstance necessitating the replacement
of such officer. The Managing Member hereby appoints the following individuals
as the following officers of the Company:

 

4

 

	
  Officer

  	
   

  	
  Position

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Mayo S. Stuntz,
  Jr.

  	
   

  	
  Executive Vice President, Treasurer

  	
   

  
	
  Paul M. McNicol

  	
   

  	
  Senior Vice President, Secretary

  	
   

  
	
  Robert B.
  Sherman

  	
   

  	
  Senior Vice President

  	
   

  

 

(i)         Subject
to the provisions of Section 3.2(a) hereof, the president shall in general
supervise and control all of the business and affairs of the Company and may
execute any deed, mortgage, bond, contract or other instrument, except in cases
where the execution thereof shall be expressly delegated by the Managing Member
to some other officer or agent of the Company or shall be required by law to be
otherwise executed; and in general shall perform all duties incident to the
office of president and such other duties as may be prescribed by the Managing
Member from time to time. In the absence of a designation of a chief executive
officer by the Managing Member, the president shall be the chief executive
officer of the Company.

 

(ii)        Subject
to the provisions of Section 3.2(a) hereof, in the absence of the president or
in the event of a vacancy in such office, the executive vice president or, in
the absence of the executive vice president or in the event of a vacancy in
such office, the senior vice president shall perform the duties of the
president and when so acting shall have all the powers of and be subject to all
the restrictions upon the president; and shall perform such other duties as
from time to time may be assigned to such vice president by the president or
the Managing Member.

 

(iii)       Subject
to the provisions of Section 3.2(a) hereof, the treasurer shall have the
custody of the funds and securities of the Company and shall keep full and
accurate accounts of receipts and disbursements in books belonging to the
Company and shall deposit all moneys and other valuable effects in the name and
to the credit of the Company in such depositories as may be designated by the
Managing Member. The treasurer shall disburse the funds of the Company as may
be ordered by the Managing Member, taking proper vouchers for such disbursements,
and shall render to the president and the Managing Member, whenever the
Managing Member may require, an account of all his or her transactions as
treasurer and of the financial condition of the Company. In the absence of a
designation of a chief financial officer by the Managing Member, the treasurer
shall be the chief financial officer of the Company.

 

(iv)       Subject
to the provisions of Section 3.2(a) hereof, the secretary shall: (A) keep
the minutes of the proceedings of the Members in one or more books provided for
that purpose; (B) see that all notices are duly given in accordance with
the provisions of this Agreement or as required by law; (C) be custodian
of the records and the seal of the Company; (D) keep a register of the
address of each Member which shall be furnished to the secretary by such
Member; (E) have general charge of the Membership Interest transfer books
of the Company; and (F) in general perform such other duties as from time
to time may be assigned to the secretary by the president or the Managing
Member.

 

5

 

(v)        Subject
to the provisions of Section 3.2(a) hereof, the assistant secretaries and
assistant treasurers, in general, shall perform such duties as shall be
assigned to them by the secretary or treasurer, respectively, or by the
president or the Managing Member.

 

SECTION 3.3.        Participation by Members. Other than the Managing Member, no Member, in such Member’s capacity
as a Member, shall (a) participate in the control of the business of the
Company, (b) have any right or power to sign for or to bind the Company in any
manner or for any purpose whatsoever or (c) have any rights or powers with
respect to the Company except those expressly granted to such Member by the
terms of this Agreement or those conferred upon such Member by law. Except as
otherwise provided in this Agreement, no prior consent or approval of any
Member, other than the Managing Member, shall be required in respect of any act
or transaction to be taken by the Managing Member on behalf of or by the
Company.

 

SECTION 3.4.        Compensation; Reimbursement. Except
as specifically provided herein, as agreed to by the Managing Member, or, in
the case of any officer of the Company, as provided for in an employment agreement
between such officer and the Company, no Member or officer of the Company shall
be entitled to receive any salary or other remuneration from the Company in
exchange for such Person’s provision of any services to the Company pursuant to
this Agreement.

 

SECTION 3.5.        Duties; Outside Interests. Each
Member shall devote such time and attention to the business and affairs of the
Company as is reasonably necessary to perform such Member’s obligations
hereunder, but it is understood that the Members have other business interests
and therefore shall not be obligated to devote their time exclusively to the
business of the Company. Each Member may engage, invest, participate in or
otherwise enter into other business ventures of any kind, nature and
description, individually and with others; provided that any such
business venture does not directly compete with the Company or otherwise
violate any exclusivity, non-compete or similar restriction agreed to by such
Member or any Affiliate of such Member with the Company. Any such activities by
a Member shall not give rise to any right of the Company or the other Members
to participate in any such activities or in the income or profits derived
therefrom.

 

SECTION 3.6.        Conflicts of Interest. Any Person
retained by the Company in connection with the operation and management of the
business of the Company may also be employed or retained by any Member in
connection with other business ventures of such Member, and any Member, family
member of a Member or Affiliate of a Member may be directly or indirectly
interested in or connected with any Person so employed by the Company or from
whom the Company may buy merchandise, services or other property; provided,
in each case, that any such retention, employment or interest does not
otherwise violate any exclusivity, non-compete or similar restriction agreed to
by such Person, Member, family member or Affiliate with the Company.

 

6

 

ARTICLE
IV

 

ACCOUNTING
AND REPORTING PROVISIONS

 

SECTION 4.1.        Fiscal Year. The fiscal year of
the Company shall be the calendar year.

 

SECTION 4.2.        Books and Accounts. (a)  Complete and accurate books and accounts
shall be kept and maintained for the Company at the principal place of business
of the Company on such basis as to be determined by the Managing Member. Such
books and records shall include such separate accounts for each Member as shall
be necessary to reflect accurately the rights and interests of the respective
Members. Each Member or such Member’s duly authorized representative, at such
Member’s own expense, shall at all reasonable times have access to, and may
inspect and copy, such books and accounts and other records of the Company.

 

(b)           All funds received by the Company
shall be deposited in the name of the Company in such bank account or accounts
as the Managing Member may designate from time to time and withdrawals
therefrom shall be made upon such signature or signatures on behalf of the
Company as the Managing Member may designate from time to time. No funds of the
Company shall be deposited in any other account and no funds of other Persons
shall be deposited in any Company account.

 

SECTION 4.3.        Tax Reports. The Managing Member,
at the Company’s expense, shall cause the Company to prepare and file, in a
timely manner, all income tax returns of the Company for each fiscal year. The
Company shall transmit to each Member, within ninety (90) days following the
last day of each fiscal year of the Company, information necessary for the
preparation of each Member’s Federal, State and local tax returns, including
each Member’s pro rata share of income,
credit and deductions for the prior fiscal year.

 

SECTION 4.4.        Tax Elections. The Company shall
treat as an expense for Federal income tax purposes all amounts incurred by it
that may, in accordance with applicable law and regulations, be considered an
expense. Upon the happening of a suitable event, the Members may make an
election pursuant to the provisions of Section 754 of the Internal Revenue Code
of 1986, as amended (the “Code”), and may make all other applicable
elections required or permitted by the Code.

 

SECTION 4.5.        Tax Matters Partner. The Managing
Member shall be the “tax matters partner” of the Company, as such term is
defined in Section 6231(a)(7) of the Code.

 

SECTION 4.6.        Accountants. The Managing Member
may, from time to time in its sole discretion: (a) appoint an independent
public accounting firm to serve as outside accountant for the Company and (b)
remove and replace same. The Managing Member will cause such accountant to
prepare the Company’s financial statements (which shall be audited on an annual
basis by such accountant, if so required by the Managing Member) and necessary
tax

 

7

 

returns, and shall provide to such accountant such
information as may reasonably be required in order to prepare such financial
statements and such tax returns.

 

ARTICLE
V

 

TRANSFERS

 

SECTION 5.1.        General Restriction on Transfer. Except
as otherwise set forth in this Agreement, no Member (other than Pilot) shall,
directly or indirectly, sell, exchange, pledge, give, transfer, assign or in
any other way whatsoever encumber or dispose of (collectively, “Transfer”)
the Membership Interest or Contingent Interest now or hereafter owned by such
Member, or any interest therein, or the right to receive the same, or any
certificates representing the same, or any other rights or obligations under
this Agreement, in each case without the prior written consent of the Managing
Member; provided that each Member may, at any time, on not less than 30
days’ prior written notice to the Managing Member and each other Member,
Transfer all, but not less than all, of such Member’s Membership Interest or
Contingent Interest to an Affiliate of such Member. Any purported transfer in
violation of the provisions of this Agreement shall be null and void ab initio and no distributions shall be paid
on, and no voting rights shall be accorded to, any Membership Interest so
transferred.

 

SECTION 5.2.        Expenses of Transfer; Indemnification.
All expenses, including attorneys’ fees and expenses, incurred by the Company
in connection with any Transfer shall be fully borne by the transferring Member
and such Member’s transferee. In addition, the transferring Member and such
transferee shall, jointly and severally, indemnify the Company in a manner
satisfactory to the Managing Member, in its sole discretion, against any
losses, claims, damages, liabilities or expenses to which the Company may become
subject arising out of or based upon any false representation or warranty made
by, or breach or failure to comply with any covenant or agreement of, such
transferring Member or such transferee in connection with such Transfer.

 

SECTION 5.3.        Recognition of Transfer. (a)  The Company shall not recognize for any
purpose any purported Transfer of a Membership Interest or a Contingent
Interest (including some or all of a Member’s rights or obligations hereunder)
unless:

 

(i)         the
applicable provisions of this Agreement shall have been complied with;

 

(ii)        the
Company shall have been furnished with the documents effecting such Transfer,
in form and substance satisfactory to the Managing Member, executed and
acknowledged by both transferor and the transferee;

 

(iii)       such
Transfer shall have been made in accordance with all applicable laws and
regulations and all necessary governmental consents shall have been obtained
and requirements satisfied; and

 

8

 

(iv)       the
books and records of the Company shall have been changed (which change the
Company shall cause to be made as promptly as practicable) to reflect the
admission of such transferee.

 

(b)           Each transferee, as a condition of
the Company’s recognition of such Transfer, shall execute and acknowledge such
instruments, in form and substance satisfactory to the Managing Member, as the
Managing Member deems necessary or desirable in its sole discretion to
effectuate such Transfer and to confirm the agreement of such transferee to be
bound by all the terms and provisions of this Agreement.

 

(c)           Upon the Transfer by a Member of such
Member’s Membership Interest or Contingent Interest in accordance with the
provisions of this Article V, the related transferee shall be deemed to be a
Member hereunder and shall succeed to the Transferred rights and obligations of
the transferor under this Agreement and the Act. The transferor shall have no
further right as a Member under this Agreement or the Act with respect to the
rights and obligations Transferred, including, without limitation, any right to
vote upon any matter regarding the Company and the Company and the Managing
Member, respectively, may act without any consent, approval or vote theretofore
required to be obtained from such Member with respect to the rights and
obligations Transferred. Notwithstanding the foregoing,  no Transfer of a Membership Interest or a
Contingent Interest pursuant to this Article V shall relieve the transferor of
any of its obligations under this Agreement without the prior written consent
of the Managing Member and such transferor shall remain primarily liable for
all obligations related to the Membership Interest or Contingent Interest
Transferred therewith.

 

SECTION 5.4.        Purchase of Barrington’s Contingent
Interest. (a)  If the Management
Agreement is terminated pursuant to Section 3(b) or (f) thereof, Barrington
shall, upon demand by the Company, be obligated to sell the Contingent Interest
(as defined herein) held by Barrington to the Company, and the Company shall
have the option (which option shall be assignable by the Company without the
consent of Barrington), but not the obligation, to purchase such Contingent
Interest at a purchase price equal to the fair market value thereof (determined
by reference to the amount of distributions to which Barrington would be
entitled upon a hypothetical sale of all the Company’s assets, the payment of
all the Company’s liabilities and the distribution of the net proceeds to the
Members as provided in Section 6.2 hereof), as agreed upon by the Managing
Member and Barrington. If the Managing Member and Barrington cannot agree upon
the fair market value of such Contingent Interest, the fair market value
thereof shall be determined in the manner set forth above by an independent
appraiser selected by the Managing Member and reasonably satisfactory to
Barrington. The Company shall exercise such right by giving written notice
thereof, within 90 days following the date of the termination of the Management
Agreement, to Barrington. The closing of such purchase shall occur within 30
days after the final determination of the fair market value of the Contingent
Interest. Upon the closing of any such purchase, Barrington shall cease to be a
Member and shall have no further rights or obligations under this Agreement.

 

9

 

(b)           If the Management Agreement is
terminated pursuant to Section 3(e) thereof, Barrington shall have the right to
cause the Company to purchase Barrington’s Contingent Interest at a purchase
price equal to the fair market value thereof (which shall be determined as set
forth in Section 5.4(a) hereof). Barrington shall exercise such right by giving
written notice thereof, within 90 days following the date of the termination of
the Management Agreement. The closing of such purchase shall occur within 30
days after the final determination of the fair market value of the Contingent
Interest. Upon the closing of any such purchase, Barrington shall cease to be a
Member and shall have no further rights or obligations under this Agreement.

 

SECTION 5.5.        Tag Along Rights. At least 20
days prior to any Transfer by Pilot of 50% or more of its Membership Interest
(other than a Transfer to an Affiliate of the Managing Member), including any
Transfer to the Company, Pilot shall deliver a written notice (the “Sale
Notice”) to Barrington and to the Company, specifying the percentage of the
Membership Interest to be transferred and the price at which such Membership
Interest is being Transferred. Barrington may elect to participate in the
contemplated Transfer by delivering written notice thereof to Pilot within 20
days after delivery of the Sale Notice. If Barrington has elected to
participate in such Transfer, Pilot shall be entitled to sell in the
contemplated Transfer the percentage of Pilot’s Membership Interest stated in
the Sale Notice to be sold in such Transfer, at a price equal to 90% of the
aggregate purchase price stated in the Sale Notice to be paid in such Transfer,
and Barrington shall be entitled
to sell in such Transfer a percentage of Barrington’s Contingent Interest equal
to the percentage of Pilot’s Membership Interest stated in the Sale Notice to
be sold in such Transfer, at a price equal to 10% of the aggregate purchase
price stated in the Sale Notice to be paid in such Transfer and on the same
terms as such Transfer of Pilot’s Membership Interest.

 

ARTICLE
VI

 

DISTRIBUTIONS

 

SECTION 6.1.        Distributions of Net Operating Cash.
The Company shall distribute Net Operating Cash promptly upon the Company’s
receipt of same to the Members, pro rata based upon their
respective Membership Interests.

 

SECTION 6.2.        Distributions of Net Cash from
Capital Events. Except as the Members shall unanimously agree, upon the
occurrence of a Capital Event, the Company shall cause the net cash receipts
arising therefrom to be distributed to the Company. The Company shall
distribute Net Cash from Capital Events promptly upon the Company’s receipt of
same to the Members, in the following order of priority:

 

(a)           First, to Pilot, until Pilot
has received a return of all of its capital contributions to the Company;

 

(b)           Second, 95% to Pilot and 5% to
Barrington, until Pilot has received an amount, calculated
like interest at a rate of 9% per annum, on all of its capital contributions to

 

10

 

the Company, which amount will be calculated from the
date(s) that such capital contributions were made (the “Preferred Return”);

 

(c)           Third, 100% to Barrington, until
Barrington has received a cumulative distribution pursuant to clause (b) above
and this clause (c) equal to 10% of the amounts distributed pursuant to
clause (b) above and this clause (c); and

 

(d)           Fourth, 90% to Pilot and 10%
to Barrington.

 

The amounts distributed to Barrington pursuant
to clauses (b), (c) and (d) above are referred to herein as the “Contingent
Interest”.

 

For the purposes of
determining whether Pilot has received a return of all its capital
contributions to the Company and the Preferred Return thereon, the amount
received by Pilot shall equal the sum of all distributions of Net Operating
Cash and Net Cash from Capital Events which have previously been distributed to
Pilot.

 

SECTION 6.3.        No Right to Receive Property. No
Member shall have the right to demand and receive property other than cash in
return for such Member’s capital contribution to the Company.

 

ARTICLE
VII

 

ALLOCATION OF PROFITS AND
LOSSES

 

SECTION 7.1.        Allocations of Net Losses. Net
Losses of the Company shall be allocated among the Members as follows:

 

(a)           First, in proportion to their
positive Capital Accounts and

 

(b)           Second, to each Member in
accordance with such Member’s Membership Interest; provided that any
Company deduction attributable to the acquisition by a Member of such Member’s
Membership Interest will be allocated entirely to such Member.

 

SECTION 7.2.        Allocations of Net Income. Net
Income of the Company shall be allocated among the Members as follows:

 

(a)           First, to each Member in an
amount equal to the Net Losses previously allocated to such Member, and

 

(b)           Second, to each Member in
accordance with such Member’s Membership Interest; provided that Net
Income from a Capital Event shall be allocated in the same manner as
distributions are to be made pursuant to Section 6.2 hereof (other than
distributions constituting a non-taxable return of capital).

 

11

 

ARTICLE
VIII

 

DISSOLUTION
AND WINDING UP OF THE AFFAIRS OF THE COMPANY

 

SECTION 8.1.        General. (a)  Upon the termination of the Company in
accordance with the terms hereof, the Company shall be dissolved and its
affairs wound up in accordance with this Article and the Act.

 

(b)           The dissolution and winding up of the
affairs of the Company shall be conducted and supervised by the Managing Member
or such Person who is designated by the Managing Member for such purpose (the “Wind
Up Agent”). The Wind Up Agent shall have all of the rights and powers with
respect to the assets and liabilities of the Company in connection with the
dissolution and winding up of the affairs of the Company that the Managing
Member would have with respect to the assets and liabilities of the Company
during the term of the Company, and the Wind Up Agent is hereby expressly
authorized and empowered to execute any and all documents necessary or
desirable to effectuate the dissolution and winding up of the affairs of the
Company and the transfer of any assets or liabilities of the Company.

 

SECTION 8.2.        Statements on Termination. Each
Member shall be furnished with a statement prepared by the Company’s
independent outside accountant which shall set forth the assets and liabilities
of the Company as at the date of termination, and each Member’s share thereof. Upon
compliance with the distribution plan set forth in Section 8.3 hereof, the Wind
Up Agent shall execute, acknowledge and cause to be filed a Certificate of
Cancellation of the Company with the Department of State of the State of
Delaware.

 

SECTION 8.3.        Priority on Winding Up; Distribution
of Non-Liquid Assets. To the extent the proceeds are sufficient therefor,
as the Wind Up Agent shall deem appropriate, the proceeds of such winding up
shall be applied in the following order of priority:

 

(a)           to pay the costs and expenses of the
dissolution and winding up;

 

(b)           to pay matured debts and liabilities
of the Company (including any loans made to the Company by the Members) and to
establish any reserve that the Wind Up Agent may deem reasonably necessary for
any contingent, unmatured or unforeseen liability of the Company; and

 

(c)           the balance, if any, shall be
distributed to the Members in accordance with Section 6.2 hereof.

 

SECTION 8.4.        Orderly Wind Up. A reasonable
time shall be allowed for the orderly liquidation of the assets of the Company
and the discharge of liabilities so as to minimize the losses normally
attendant upon a dissolution and winding up.

 

12

 

SECTION 8.5.        Source of Distributions. No
Member shall be personally liable for the return of another Member’s capital
contributions to the Company, or any portion thereof, it being expressly
understood that any such return shall be made solely from Company assets.

 

SECTION 8.6.        Deficit in Capital Account. During
the term of the Company and upon the dissolution of the Company, no Member
shall be liable to the Company or the other Members for any deficit in such
Member’s Capital Account, and no such deficit shall be deemed an asset of the
Company.

 

ARTICLE
IX

 

INDEMNIFICATION;
EXCULPATION

 

SECTION 9.1.        Indemnification. The Company
shall indemnify, hold harmless and pay all judgments and claims against any
Member (including the Managing Member), any officer or employee of the Company
or any shareholder, member, director, officer, employee or other agent of, or
partner in, a Member (each, a “Covered Person”) with respect to any
liability, damage, cost or expense incurred by reason of any act performed or
omitted to be performed by such Covered Person in connection with the business
of the Company, including reasonable attorney’s fees incurred in connection
with the defense of any action based on any such act or omission, which
attorney’s fees may be paid as incurred; provided that such act or
omission was taken in good faith, was reasonably believed by such Covered
Person to be within the scope of his or her authority under this Agreement, and
did not constitute fraud, bad faith, willful misconduct, willful neglect or
gross negligence on behalf of such Covered Person. An indemnity under this
Section shall be paid out of and to the extent of Company assets only.

 

SECTION 9.2.        Exculpation. No Covered Person
shall be liable to the Company or any Member by reason of any act performed or
omitted to be performed by such Covered Person in connection with the business
of the Company; provided that such act or omission was taken in good
faith, was reasonably believed by such Covered Person to be within the scope of
such Covered Person’s authority under this Agreement, and did not constitute
fraud, bad faith, willful misconduct, willful neglect or gross negligence on
behalf of such Covered Person.

 

ARTICLE
X

 

DETERMINATION
OF DISPUTES

 

SECTION 10.1.      Determination of Disputes. Any
dispute or controversy between or among any of the Members arising in
connection with (a) the interpretation of this Agreement or any amendment
thereof or (b) the breach thereof shall be determined and settled by
arbitration in the City of New York by a panel of three members in accordance
with the rules of the American Arbitration Association. Any award rendered
therein, as hereinafter limited, shall be final and binding upon the Members
and their legal representatives and judgment may be entered in any court having
jurisdiction thereof. The expenses of such arbitration shall be

 

13

 

paid by the party against whom the award shall be
entered. The arbitrators shall be entitled to grant equitable relief.

 

ARTICLE
XI

 

NOTICES;
POWER OF ATTORNEY

 

SECTION 11.1.      Notices. All notices hereunder
shall be in writing and shall be sent by (a) certified or registered mail,
return receipt requested, (b) national prepaid overnight delivery service, (c)
facsimile transmission (following with hard copies to be sent by prepaid
overnight delivery service) or (d) personal delivery with receipt acknowledged
in writing. All notices shall be addressed to the Members at their respective
addresses as set forth below (except that any Member may from time to time upon
fifteen (15) days’ written notice change such Member’s address for that
purpose), and shall be effective on the date when actually received or refused
by the party to whom the same is directed (except to the extent sent by
registered or certified mail, in which event such notice shall be deemed given
on the third day after mailing).

 

If to the Company, at:

 

Pilot Group TV LLC

c/o Pilot Group GP LLC 

625 Madison Avenue, 3rd Floor

New York, NY 10022

Attention:  Paul M. McNicol  

Facsimile Number:  212-486-2896

 

with a copy to each Member and to (which copies shall not constitute notice):

 

Paul, Hastings, Janofsky &Walker LLP

75 East 55th Street

New York, NY  10022

Attention:  Jeffrey J. Pellegrino, Esq.

Facsimile Number:  212-319-4090

 

If to the Managing Member, at:

 

Pilot Group GP LLC

625 Madison Avenue, 3rd Floor

New York, NY 10022

Attention:  Paul M. McNicol  

Facsimile Number:  212-486-2896

 

14

 

with a copy to (which
copy shall not constitute notice):

 

Paul, Hastings, Janofsky &Walker LLP

75 East 55th Street

New York, NY  10022

Attention:  Jeffrey J. Pellegrino, Esq.

Facsimile Number:  212-319-4090

 

If to Pilot, at:

 

Pilot Group LP

c/o Pilot Group GP LLC 

625 Madison Avenue, 3rd Floor

New York, NY 10022

Attention:  Paul M. McNicol  

Facsimile Number:  212-486-2896

 

with a copy to (which
copies shall not constitute notice):

 

Paul, Hastings, Janofsky &Walker LLP

75 East 55th Street

New York, NY  10022

Attention:  Jeffrey J. Pellegrino, Esq.

Facsimile Number:  212-319-4090

 

If to Barrington, at:

 

Barrington Broadcasting
Company, LLC

2500 West Higgins Road, Suite 880

Hoffman Estates, IL  60195

Attention:  K. James Yager

Facsimile Number:  847-755-3045

 

with a copy to (which copy shall not constitute
notice):

 

Covington & Burling

1201 Pennsylvania Avenue, N.W.

Washington, DC  20004

Attention:  Eric Dodson Greenberg, Esq.

Facsimile Number:  202-778-5193

 

SECTION 11.2.      Routine Communications. Notwithstanding
the provisions of Section 11.1 hereof, routine communications such as
distribution checks or financial statements of the Company may be sent by
first-class mail, postage prepaid. The Company shall cause distributions to be
made by means of wire transfer to any Member who requests the same and who
provides the Company with wire transfer instructions or by such other electronic
means as are agreed to by the Company and such Member.

 

15

 

ARTICLE
XII

 

DEFINITIONS

 

SECTION 12.1.      Definitions. For the purposes of
this Agreement, the following terms shall have the following meanings:

 

“Act”
has the meaning given to such term in the Recitals hereof.

 

“Affiliate”
means, with respect to any Person, any Person Controlling, Controlled by, or
under common Control with, such Person.

 

“Agreement”
has the meaning given to such term in the introductory paragraph hereof.

 

“Barrington”
has the meaning given to such term in the introductory paragraph hereof.

 

“Capital
Account” means, with respect to each Member, the sum of the capital
contributions made by such Member to the Company (or to which a transferee
Member has succeeded), increased by the amount of Net Income allocated to such
Member pursuant to Section 7.2 hereof and decreased by (a) all Net Losses
allocated to such Member pursuant to Section 7.1 hereof and (b) all amounts
paid or distributed to such Member pursuant to Sections 6.1, 6.2 and 8.3
hereof.

 

“Capital
Event”  means any sale of an asset of
the Company, any sale of all or substantially all of the assets of any direct
or indirect wholly-owned subsidiary of the Company, or any sale of all or a
portion of the Company’s interest in an entity which directly or indirectly
holds an asset of the Company.

 

“Code”
has the meaning given to such term in Section 4.4 hereof.

 

“Company”
has the meaning given to such term in the introductory paragraph hereof.

 

“Contingent
Interest” has the meaning given to such term in Section 6.2 hereof.

 

“Control”
shall mean, the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of another Person without the
consent or approval of any other person.

 

“Covered
Person” has the meaning given to such term in Section 9.1 hereof.

 

“Disability”
means, with respect to any natural person, the insanity or physical or
psychological incompetency of such natural person which condition persists for
6 months or more on a continuous basis.

 

16

 

 “Management Agreement” has the meaning
given to such term in the Recitals hereof.

 

“Managing
Member” has the meaning given to such term in Section 3.1 hereof.

 

“Member”
has the meaning given to such term in the introductory paragraph hereof.

 

“Membership
Interest” has the meaning given to such term in Section 2.2 hereof.

 

“Net
Cash from Capital Events”  means the
Company’s cash receipts from Capital Events, net of the Company’s costs and
expenses.

 

“Net
Income” means the income of the Company for each Company fiscal year, as
determined in accordance with accepted Federal income tax accounting
principles, as reported by the Company for Federal income tax purposes on its
United States income tax return.

 

“Net
Loss” means the loss of the Company for each Company fiscal year, as
determined in accordance with accepted Federal income tax accounting
principles, as reported by the Company for Federal income tax purposes on its
United States income tax return.

 

“Net
Operating Cash” means the Company’s cash receipts from operations,
excluding cash receipts from capital contributions and proceeds from Capital
Events, net of the Company’s costs and expenses, including, without limitation,
all capital expenses and debt service payments.

 

“Original
Agreement” has the meaning given to such term in the Recitals hereof.

 

“Person”
means a natural person, company, joint venture, corporation, limited liability
company, partnership, trust or other entity.

 

“Preferred
Return” has the meaning given to such term in Section 6.2(b) hereof.

 

“Sale
Notice” has the meaning given to such term in Section 5.5 hereof.

 

“Transfer”
has the meaning given to such term in Section 5.1 hereof.

 

“Wind
Up Agent” has the meaning given to such term in Section 8.1(b) hereof.

 

ARTICLE
XIII

 

GENERAL
PROVISIONS

 

SECTION 13.1.      Entire Agreement. This Agreement
constitutes the entire understanding among the Members with respect to the
subject matter hereof.

 

17

 

SECTION 13.2.      Amendment. No amendment, waiver or
modification of the provisions hereof shall be valid unless in writing and
signed by each Member; provided that the Managing Member may, in its
sole discretion, make such amendments to this Agreement as are necessary in
connection with the admission of additional Members to the Company.

 

SECTION 13.3.      Governing Law. This Agreement shall
be governed by, and construed in accordance with, the laws and decisions of the
State of Delaware, without regard to the conflicts of law provisions thereof.

 

SECTION 13.4.      Captions. The captions used herein
are intended for convenience of reference only, shall not constitute part of
this Agreement and shall not modify or affect in any manner the meaning or
interpretation of any of the provisions of this Agreement.

 

SECTION 13.5.      Successors. Except as otherwise
provided herein, this Agreement shall be binding upon and shall inure to the
benefit of the respective heirs, executors, administrators, legal
representatives, and permitted successors and assigns of the parties hereto.

 

SECTION 13.6.      Construction. None of the
provisions of this Agreement shall be for the benefit of or enforceable by any
creditor of the Company.

 

SECTION 13.7.      Severability. In case any one or
more of the provisions contained in this Agreement or any application thereof
shall be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein and
other application thereof shall not in an way be affected or impaired thereof.

 

SECTION 13.8.      Further Assurances. The parties
hereto shall execute and deliver such further instruments and do such further
acts and things as may be required to carry out the intent and purposes of this
Agreement.

 

SECTION 13.9.      Gender and Number. Whenever
required by the context hereof, the singular shall include the plural and the
plural shall include the singular. The masculine gender shall include the
feminine and neuter genders.

 

SECTION 13.10.    No Third-Party Rights. Nothing in
this Agreement shall be deemed to create any right in any Person not a party
hereto (other than the Covered Persons and the permitted successors and assigns
of a party hereto) and this Agreement shall not be construed in any respect to
be a contract in whole or in part for the benefit of any third party (except as
aforesaid).

 

SECTION
13.11.    Counterparts. This
Agreement may be executed and delivered in counterparts, each of which when so
executed and delivered shall be an original, but all of which together shall
constitute one and the same instrument.

 

 

[SIGNATURE PAGE FOLLOWS]

 

18

 

IN
WITNESS WHEREOF, the undersigned have executed and delivered this Agreement as
of the date first written above.

 

	
   

  	
   

  	
  THE
  MEMBERS:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  PILOT GROUP LP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Pilot Group GP LLC

  
	
   

  	
   

  	
  Its:

  	
  General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Paul M. McNicol

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Paul M. McNicol

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BARRINGTON BROADCASTING
  

  
	
   

  	
   

  	
  COMPANY, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ K. James Yager

  	
   

  
	
   

  	
   

  	
   

  	
  Name: K. James Yager

  
	
   

  	
   

  	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  THE
  MANAGING MEMBER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  PILOT GROUP GP LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Paul M. McNicol

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Paul M. McNicol

  
	
   

  	
   

  	
   

  	
  Title: Senior Vice
  President

  

 

 

[Signature Page to the Amended and Restated 

Limited Liability Company Operating Agreement of Pilot Group TV LLC]Exhibit 10.6

 

EXECUTION COPY

 

MANAGEMENT
AGREEMENT

 

This Management Agreement (this “Agreement”) is made
and entered into as of December 30, 2003, by and between Pilot Group TV LLC, a
Delaware limited liability company (the “Company”), and Barrington Broadcasting
Company, LLC, a Delaware limited liability company (the “Manager”).

 

BACKGROUND

 

WHEREAS, Pilot TV Acquisition Corporation (“PTVAC”), a
wholly-owned subsidiary of the Company, is preparing to enter into an asset
purchase agreement with  Chelsey Broadcasting Company of Quincy, Chelsey Broadcasting Company of
Peoria, LLC and Chelsey Broadcasting
Company, LLC (the
“WHOI-TV/KHQA-TV Asset Purchase Agreement”) to acquire the WHOI-TV and KHQA-TV
television stations (the “WHOI-TV/KHQA-TV Stations”);

 

WHEREAS, PTVAC also is preparing to enter into an
asset purchase agreement with LIN Television Corporation, WEYI Television, Inc.
and WEYI Broadcasting, LLC (together with the WHOI-TV/KHQA-TV Asset Purchase
Agreement, the “Asset Purchase Agreements”) to acquire the WEYI-TV television
station (together with the WHOI-TV/KHQA-TV Stations, the “Initial Television
Stations”);

 

WHEREAS, the Company desires to engage the Manager to
manage the Initial Television Stations and any Additional Television Stations
(as defined herein) on the terms and conditions set forth in this Agreement;
and

 

WHEREAS, on the date hereof, the Manager has become a
member of the Company in accordance with the Amended and Restated Limited
Liability Company Operating Agreement of the Company, dated as of the date
hereof.

 

NOW, THEREFORE, in consideration of the foregoing, and
of the covenants and agreements hereinafter set forth, the parties hereto,
intending to be legally bound hereby, agree as follows:

 

1.  Retention
of the Manager. Subject to the provisions of Sections 2 and 3 hereof, the
Company hereby appoints and retains the Manager as the exclusive manager of the
Initial Television Stations and such other television stations that the Company
may acquire from time to time (the “Additional Television Stations”, and
together with the Initial Television Stations, the “Stations”), and the Manager
hereby accepts such appointment and retention and agrees to serve the Company
in such capacity, pursuant to the terms and conditions hereinafter set forth. For
purposes of this Agreement, unless the context otherwise requires, the term “Company”
also shall include any existing or future subsidiaries of the Company.

 

 

2.  Authority
and Duties of the Manager.

 

(a)  Subject
to the overall direction and ultimate control and general supervision of the
Managing Member of the Company (the “Managing Member”), the Manager agrees to
provide and the Company agrees to accept the services described in Section 1 of
this Agreement.

 

(b)  Without
limiting the generality of the foregoing, pursuant and subject to Section 2(a)
hereof and the other the terms and conditions set forth herein, the Manager
shall:

 

(i)                                     oversee
and supervise the operations of the Stations in accordance with policies
established by the Managing Member and usual and customary standards of
efficient operation and maintenance;

 

(ii)                                  generally
establish and oversee the human resource functions of the Stations and shall:

 

(A)                              select,
discharge and review performance and training of all personnel necessary to
conduct the business of the Stations;

 

(B)                                establish
personnel and other management policies and procedures as shall be necessary in
connection with the management and operation of the Stations;

 

(C)                                supervise
the training of management personnel (and replacements therefor) of the
Stations; and

 

(D)                               develop
and implement compensation policies with respect to personnel employed by the
Company at the Stations and maintain individual personnel files for such
employees;

 

(iii)                               maintain
and operate the Stations including normal repairs, replacements, modifications,
capital and other improvements and maintenance thereof;

 

(iv)                              maintain
the operation of the Stations in compliance, in all material respects, with all
applicable rules, regulations and orders of any federal, state, county or
municipal authority having jurisdiction over the Company and/or the Stations;

 

(v)                                 supervise
the establishment of maintenance standards for the plant and equipment located
at the Stations;

 

(vi)                              supervise
the negotiation, consummation and performance by the Stations of operating
agreements, contracts for the purchase, lease, servicing, construction, license
or use of properties, services and rights as may be necessary or desirable in
connection with the operation or

 

2

 

maintenance of the Stations and such other agreements
with respect to the Stations as the Manager may deem necessary or advisable;

 

(vii)                           assist
with the acquisition and maintenance by the Company of such insurance coverage
with respect to the Stations as the Company may determine upon advice and
consultation of the Manager;

 

(viii)                        supervise
the development and implementation of business management and other corporate
strategies, and all marketing strategies, sales promotions and advertising for
the Stations;

 

(ix)                                assist
in the timely preparation and distribution of annual operating budgets, annual
capital budgets, business plans, cash flow and profit and loss projections,
personnel requirements and key performance milestones for the Company and the
implementation of appropriate accounting, financial, administrative and
managerial controls for the Company;

 

(x)                                   assist
with the preparation of the Company’s monthly and quarterly status reports,
financial reports and cash disbursements reports, as reasonably necessary in
the operation of the Company, and maintain files and records for the Company;

 

(xi)                                supervise
the collection of income and other amounts due to the Stations and the payment
on behalf of the Stations of expenses relating to the operations and activities
of the Stations in conformity with the annual budgets and business plans of the
Company;

 

(xii)                             provide
to the Company all information necessary for the Company (or its outside
accountants) to prepare its federal, state and local income tax and property
tax returns;

 

(xiii)                          assist
the Company (and its independent public accountants) in the preparation of its
annual audited financial statements;

 

(xiv)                         assist
in the preparation of all documents, certificates, reports and other
information required to be delivered to the Company’s lenders and otherwise
assist the Company and its subsidiaries to comply with the terms of any
document with any such lender;

 

(xv)                            generally
establish and oversee management information systems of the Company relating to
the Stations; and

 

(xvi)                         perform
the primary due diligence work on proposed station acquisitions and assist the
Company in negotiating and executing documentation for such acquisitions as
directed by the Managing Member.

 

(c)  The
Manager covenants with the Company to manage and operate the Stations and to
perform its duties and obligations under this Agreement in accordance with all
applicable laws.

 

3

 

(d)  The
Manager shall conduct itself with the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent manager would use in the
conduct of an enterprise of like character and with like aims as the Company.

 

(e)  It
is agreed and understood by the parties hereto that the duties and
responsibilities of the Manager hereunder and under each Approved Management
Agreement (as defined in Section 5) shall be performed on a full-time basis by
K. James Yager (“Yager”), Christopher Cornelius (“Cornelius”), Mary Flodin and
Keith Bland (collectively, the “Manager Principals”), or such other principals
of the Manager as may be agreed to from time to time by Yager and  the Managing Member.

 

(f)  Nothing
contained in this Agreement, including without limitation this Section 2, shall
be construed (i) in a manner contrary to the Communications Act, as amended, or
the applicable rules, regulations and policies of the Federal Communications
Commission, or (ii) to limit the full authority, control and power of the
licensee of each Station, whether PTVAC or any affiliate of the Company, with
respect to the business, management and operation of any Station, including
with respect to the operation, programming, finance or personnel matters
relating to each such Station.

 

3.  Term
of Agreement. The term of this Agreement shall commence on the Closing Date
(as defined herein) and continue until the third anniversary of the Closing
Date unless and until terminated as follows:

 

(a)  Upon
the consummation of any transaction or the occurrence of any event in either
case which constitutes a  Liquidity
Event;

 

(b)  By
the Company immediately upon written notice to the Manager for Cause; provided
that if the sole event constituting Cause is the failure of either Yager or
Cornelius to be employed by the Manager, the Manager shall have 30 days
following the occurrence of such event in order to cure same;

 

(c)  By
the Company, immediately upon written notice to the Manager, upon or following the
consummation of a Qualified Public Offering;

 

(d)  By
the Company, immediately upon written notice to the Manager, upon or following
the dissolution of the Company;

 

(e)  By
the Manager, in the event that the Company materially breaches this Agreement
and fails to cure such breach within 30 days following receipt by the Company
of written notice of the breach (or if such breach is not susceptible of cure
within such period and results from events beyond the Company’s reasonable
control, fails to cure such breach as promptly as possible); or

 

(f)  By
the Company, in the event that the Manager materially breaches this Agreement
and fails to cure such breach within 30 days following receipt by the Manager
of written notice of the breach (or if such breach is not susceptible of

 

4

 

cure within such period
and results from events beyond the Manager’s reasonable control, fails to cure
such breach as promptly as possible).

 

“Liquidity
Event” means (i) the sale of all or substantially all of the Company’s assets,
(ii) a consolidation or merger of the Company with or into another entity which
results in the members of the Company owning less than 50% of the outstanding
common equity securities of the surviving entity of such consolidation or
merger, or (iii) the date on which the Pilot Group LP ceases to own at least a
majority of the membership interests of the Company, whether as a result of the
sale by the Pilot Group LP of such membership interests or the issuance by the
Company of additional membership interests. “Cause” shall
exist if (i) the Manager has engaged in gross negligence or willful misconduct
in the performance of its duties hereunder, (ii) either Yager or Cornelius
ceases to be employed by the Manager, (iii) the Manager commits an act of fraud
or intentionally misappropriates funds of the Company, (iv) the bankruptcy of
the Manager, or (v) the indictment of the Manager or any of the Manager
Principals for any criminal act. “Qualified Public Offering” shall mean an
underwritten primary offering to the public of the common equity securities of
the Company or any direct or indirect subsidiary of the Company that is
controlled by the Company, in each case where the gross proceeds of any such
offering shall not be less than $75 million.

 

4.  Effect
of Termination. (a)  On the effective
date of the termination of this Agreement, the appointments made in Sections 1
and 2 hereof shall terminate and no further services shall be performed by the Manager under
this Agreement after such date. The
Manager shall promptly deliver to the Company any and all of the funds
of the Company held by the Manager and shall prepare and deliver to the Company
a full accounting showing all payments collected for the Company’s account, all
expenses paid on the Company’s account, and a statement of all funds held by it
on the Company’s account. The Manager shall also deliver to the Company any
funds received by the Manager after the date of termination which relate to the
Company. All materials, supplies, keys, deeds, leases, contracts, other
instruments and documents, insurance policies, plans, specifications,
promotional materials and such other accounting papers and records as pertain
to this Agreement, the Company or any of the Stations shall be delivered to the
Company within a reasonable period of time after the effective date of
termination

 

(b)                                 If this Agreement expires in accordance with
its terms or is terminated pursuant to Section 3(a), (b), (c), (d) or (f), the
Manager shall be entitled to  receive
only the portion of the Management Fee accrued through the date of termination,
and no other compensation or benefits shall be payable to the Manager. If this
Agreement is terminated pursuant to Section 3(e), the Manager shall be entitled
to receive, within 30 days of the date of termination, an amount equal to 50%
of the Management Fee payable to the Manager for the fiscal year of the Company
in which such termination occurs.

 

(c)                                  Notwithstanding
the termination of this Agreement for any reason, the rights and obligations of
the parties under Sections 5, 8, 11 and 14 hereof shall survive any such
termination and remain in full force and effect indefinitely.

 

5

 

5.  Exclusivity;
Non-Competition. The Manager, Yager and Cornelius recognize and
acknowledges that their services to the Company are of a special, unique and
extraordinary nature that cannot easily be duplicated. Further, the Company has
and will expend substantial resources to promote such services and develop the
Company’s business. Accordingly, in order to protect the Company from unfair
competition, the Manager, Yager and Cornelius agree that, at all times during
the Restricted Period, they will not, and will cause the other principals and
employees of the Manager not to, directly or indirectly, (a) perform or provide
managerial or employee services on behalf of any person which is engaged in, or
plans to engage in, any business that directly or indirectly competes with the
Company’s business within the United States; or (b) have any interest in any
business (other than in the Company) that competes with the Company’s business.
In the event that a court of competent jurisdiction shall determine that any
provision of this Section 5 is invalid or more restrictive than permitted under
the governing law of such jurisdiction, then only as to enforcement of this
Section 5 within the jurisdiction of such court, such provision shall be
interpreted and enforced as if it provided for the maximum restriction
permitted under such governing law. It is recognized and hereby acknowledged by
the parties hereto that a breach by the Manager, Yager and/or Cornelius  of any of the covenants contained in  this Section 5 will cause irreparable harm
and damage to the Company, the monetary amount of which may be virtually
impossible to ascertain. As a result, the Manager, Yager and Cornelius
recognize and hereby acknowledge that the Company shall be entitled to an
injunction from any court of competent jurisdiction enjoining and restraining
any violation of any or all of the covenants contained in this Section 5 by the
Manager, Yager and/or Cornelius and that such right to injunction shall be
cumulative and in addition to whatever other remedies the Company may possess. “Restricted
Period” shall mean the period beginning on the date hereof and ending on the
first anniversary of the effective date of the termination of this Agreement. Notwithstanding
the foregoing, the provisions of this Section 5 shall not prohibit the Manager
from performing its obligations under any management agreement relating to
television stations owned by Chelsey Broadcasting Company L.L.C. or LIN
Television Corporation or their respective affiliates; provided that any
such agreement has been approved by the Managing Member (an “Approved
Management Agreement”).

 

6.  Relationship
of the Parties; Actions of the Manager. The parties specifically
acknowledge that the Manager is an independent contractor to the Company, and
that the Manager shall in no way be construed to be an agent of the Company. Except
as expressly permitted by this Agreement, the Manager shall not have any
authority to take any action or otherwise act for or on behalf of the Company,
or to incur any liability or obligation for or on behalf of the Company. The
Manager shall not be obligated to make any advance to or for the account of the
Company or to pay any sum on account of the Company. Notwithstanding anything
in this Agreement to the contrary, the Company at all times will own its
properties and assets, be responsible for its liabilities and obligations and
exercise ultimate control over the business and operations of the Company.

 

7.  Expenses;
Management Fee. (a)  The Manager
shall bear the following ordinary day-to-day expenses incidental to the operation
of the Manager:  (i) all costs and
expenses relating to office space, facilities, utility service, supplies and
necessary administrative and clerical functions in connection with the Manager’s
operations and (ii)

 

6

 

compensation and benefits
for all employees who are engaged in the operation or management of the Manager’s
business (collectively, the “Overhead Expenses”).

 

(b)                                 In
consideration for the performance of its obligations under this Agreement, the
Manager shall be entitled to an annual management fee (the “Management Fee”)
payable by the Company monthly in advance. The amount of the Management Fee for
each fiscal year of the Company shall be equal to the budgeted Overhead
Expenses for such fiscal year as agreed to by the Managing Member and the
Manager and may include a performance management fee tied to metrics
established by and payable at the discretion of the Managing Member. The
budgeted Overhead Expenses for the Company’s 2004 fiscal year are attached
hereto as Exhibit A (the parties acknowledge that the budgeted Overhead
Expenses set forth on Exhibit A are based upon the Manager’s management of five
Stations and, accordingly, the parties will reevaluate such budgeted Overhead
Expenses if the Company acquires more than two Additional Television Stations).
The budgeted Overhead Expenses will be set forth in a detailed monthly budget
of the Manager’s projected costs and expenses in providing the services
contemplated hereby, including travel and entertainment expenses. Such budget
shall be prepared by the Manager by November 30 of each fiscal year for the
following fiscal year. The Manager and the Managing Member will cooperate in
good faith to determine the budgeted Overhead Expenses by December 20 of each
fiscal year. In the event the parties
are unable to agree upon the budgeted Overhead Expenses for a fiscal year by
the first day of such fiscal year, the budgeted Overhead Expenses for the prior
fiscal year shall continue to apply for a period of three months. The
Management Fee will be prorated for any partial fiscal year.

 

(c)                                  All
expenses, costs, losses, liabilities or damages incurred with respect to the
operations of the Company, and any expenses incurred by the Manager at the
Company’s direction involving additional Station acquisition opportunities for
the Company, will be paid by the Company and, to the extent that the Manager
pays or incurs any obligation for any such expenses, costs, losses, liabilities
or damages, the Company will pay or reimburse the Manager therefor. Payment of
expense reimbursement shall be made monthly by the Company to the Manager
within 5 days after receipt by the Company of a statement (the “Monthly Expense
Statement”) of the Manager’s estimated reimbursable expenses for the preceding
month. The Monthly Expense Statement shall include an adjustment to reflect the
amount by which actual reimbursable expenses incurred during the month
immediately preceding the month of payment exceeded, or were exceeded by, the
Manager’s estimated reimbursable expenses with respect to such month.

 

(d)                                 Any
and all fees or compensation received by the Manager from any third party in
connection with its operation and management of the Stations or pursuant to an
Approved Management Agreement shall be applied as an offset to the Management
Fees owed to the Manager hereunder.

 

8.  Indemnification.
 The Company agrees to indemnify, defend
and hold harmless the Manager and its officers, directors, members, employees
and agents (each, a “Covered Person”) from and against any and all pending or
threatened claims, losses, liabilities, litigation, damage, penalty, expense
and demands of every kind and nature whatsoever (any of the foregoing, a “Loss”),
including, without limitation, the costs as

 

7

 

and when incurred of
investigating and defending any such Loss, and including, without limitation,
reasonable attorneys’, accountants’ and experts’ fees and disbursements
therefor, incurred by a Covered Person (and in the case of the Manager in its
capacity as manager under this Agreement and not as a direct or indirect holder
of equity in the Company) resulting from, relating to or arising in connection
with such Covered Person’s performance of its duties and activities under this
Agreement or otherwise resulting from, relating to or arising in connection
with the business and operations of the Company, PTVAC or any Station; provided,
however, that the Company shall not be required to indemnify or hold
harmless a Covered Person from (a) any Loss which is attributable to the
willful misconduct or gross negligence of such Covered Person or its members,
officers, directors, agents and employees, (b) any Loss arising out of the
Manager’s internal operations, such as Overhead Expenses, except as provided in
Section 7 hereof or (c) any Loss arising out of any action taken by any Covered
Person which action is beyond the scope of authority granted to the Manager
under this Agreement. The Manager shall obtain and maintain, at its expense,
director and officer liability insurance to protect the Manager and its
employees.

 

9.  Notices.
 All notices, demands, requests or other
communications which may be or are required to be given, served or sent by a
party pursuant to this Agreement shall be validly given or made if in writing,
(a) upon actual receipt when delivered by hand, (b) upon receipt of
transmission confirmation when sent by facsimile, or (c) three days after
mailing if mailed by first-class certified or registered United States mail,
postage prepaid and return receipt requested, or (d) one day after sending by
overnight courier with postage prepaid, in each case delivered or addressed as
set forth below or at such other address as any party hereto may from time to
time advise the other party pursuant to this Section 9. Rejection or other
refusal to accept or the inability to deliver because of changed address of
which no notice was given shall be deemed receipt of the notice.

 

	
   

  	
  (a)
  If to the Company:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Pilot
  Group TV LLC

  	
   

  	
   

  
	
   

  	
   

  	
  c/o
  Pilot Group LP

  	
   

  	
   

  
	
   

  	
   

  	
  625
  Madison Avenue, 3rd Floor

  	
   

  	
   

  
	
   

  	
   

  	
  New
  York, NY 10022

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:
  Paul M. McNicol

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile
  Number:  212-486-2896

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Paul,
  Hastings, Janofsky &Walker LLP

  	
   

  	
   

  
	
   

  	
   

  	
  75
  East 55th Street

  	
   

  	
   

  
	
   

  	
   

  	
  New
  York, NY 10022

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:
  Jeffrey J. Pellegrino, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile
  Number:  212-319-4090

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)
  If to the Manager:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Barrington Broadcasting Company, LLC

  	
   

  	
   

  
	
   

  	
   

  	
  2500
  West Higgins Road, Suite 880

  	
   

  	
   

  

 

8

 

	
   

  	
   

  	
  Hoffman
  Estates, IL 60195

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: K. James Yager

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile Number: 847-755-3045

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Covington & Burling

  	
   

  	
   

  
	
   

  	
   

  	
  1201 Pennsylvania Avenue, N.W.

  	
   

  	
   

  
	
   

  	
   

  	
  Washington, DC 20004

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Eric Dodson Greenberg, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile Number: 202-778-5193

  	
   

  	
   

  

 

10.  Entire
Agreement. This Agreement contains the entire agreement among the parties
with respect to the transactions contemplated herein, and supersedes all prior
oral or written agreements, commitments or understanding with respect to the
matters provided for herein.

 

11.  Governing
Law; Venue; Waiver of Jury Trial. This Agreement, the rights and
obligations of the parties and any claims or disputes relating thereto shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to its conflicts of law rules. Any action, suit or proceeding in
respect of or arising out of this Agreement shall be prosecuted as to any party
hereto in New York, New York. Each party hereto consents to the exercise of
jurisdiction over its person by any court situated in the Borough of Manhattan,
City of New York, State of New York and having jurisdiction over the subject
matter of any such action, suit or proceeding, and consents to the service of
process in connection therewith by notice given in accordance with Section 9
hereof. Each party hereto waives any right such party may have to a jury trial
in connection with any such action, suit or proceeding.

 

12.  Binding
Effect. This Agreement shall be binding upon and inure to the benefit of
the parties and their respective successors and assigns.

 

13.  Assignment.
No party hereto may assign its rights or obligations hereunder without the
prior written consent of the other party.

 

14.  Confidentiality.
The parties hereto agree that the terms of this Agreement shall remain strictly
confidential as between them and that disclosure of this Agreement or any terms
herein shall not be made by either party or its respective members, partners,
directors, officers, advisors, affiliates and employees to any other person or
entity, except to the direct or indirect equity holders, lenders, successors,
heirs and assigns of the parties or as otherwise required by law, without first
obtaining the written consent of the other party. The Manager will treat as
confidential all non-public information received with respect to the Company
and use it solely to carry out its duties and responsibilities under this
Agreement.

 

15.  Amendment
and Waiver. This Agreement may be amended only with the consent of the
parties hereto. No failure to pursue to elect any remedy or waiver with respect
to any default under or breach of any provision of this Agreement shall be

 

9

 

deemed to be a waiver of
any other subsequent similar or different default, breach of provision or of
any election of remedies available in connection therewith.

 

16.  Headings.
The headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.

 

17.  Severability.
If any term or other provision herein is found to be unenforceable, invalid or
illegal, such term or provision shall be deemed deleted from this Agreement,
and the remainder of this Agreement shall not be affected or impaired thereby.

 

18.  Execution
in Counterparts. This Agreement may be executed in any number of
counterparts and it shall be sufficient that the signature of each party appear
on one or more of the counterparts. All counterparts shall collectively
constitute a single agreement. It shall not be necessary in making proof of
this Agreement to produce or account for more than a number of counterparts
containing the respective signatures of all of the parties.

 

19.  Effective
Date and Cancellation. This
Agreement shall become effective upon the later to occur of: (a) January 1,
2004 and (b) the date on which the Asset Purchase Agreements (and any related
Management Services Agreements) are executed and delivered by all of the
parties thereto (the “Closing Date”). If the Asset Purchase Agreements (and any
related Management Services Agreements) are not so executed and delivered, this
Agreement shall be cancelled and no party hereto will have any liability or
obligation to the other parties hereto.

 

[SIGNATURE
PAGE FOLLOWS]

 

10

 

IN WITNESS WHEREOF, the undersigned have duly executed
this Agreement, or have caused this Agreement to be duly executed on their
behalf, as of the day and year first above written.

 

 

	
   

  	
   

  	
  PILOT GROUP TV LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Pilot Group LP

  	
   

  	
   

  
	
   

  	
   

  	
  Its:

  	
  Managing Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Pilot Group GP, LLC

  	
   

  	
   

  
	
   

  	
   

  	
  Its:

  	
  General Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Paul M.
  McNicol

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Paul M.
  McNicol

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:   Senior
  Vice President

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BARRINGTON BROADCASTING

  	
   

  	
   

  
	
   

  	
   

  	
  COMPANY, LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ K. James Yager

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name: K. James Yager

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:  Chief
  Executive Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Acknowledged and Agreed
  Solely

  	
   

  	
   

  	
   

  	
   

  
	
  with Respect to Section
  5:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ K. James Yager

  	
   

  	
   

  	
   

  	
   

  
	
  K. JAMES YAGER

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Christopher
  Cornelius

  	
   

  	
   

  	
   

  	
   

  
	
  CHRISTOPHER CORNELIUS

  	
   

  	
   

  	
   

  	
   

  
								

 

 

[Signature Page to
Management Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]