ASSET PURCHASE AGREEMENT

Exhibit 10.3

ASSET PURCHASE AGREEMENT

     THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made as of August 19, 2005 among Emmis Television Broadcasting, L.P., an Indiana limited partnership, Emmis Television License, LLC, an Indiana limited liability company, and Emmis Indiana Broadcasting, L.P., an Indiana limited partnership (collectively, “Seller”) and LIN Television Corporation, a Delaware corporation (“Buyer”).

Recitals

     A. Seller owns and operates the following television broadcast stations (each a “Station” and collectively the “Stations”) pursuant to certain authorizations issued by the Federal Communications Commission (the “FCC”):

WALA-TV, Mobile, Alabama
WBPG(TV), Gulf Shores, Alabama
WLUK-TV, Green Bay, Wisconsin
WTHI-TV, Terre Haute, Indiana
KRQE(TV), Albuquerque, New Mexico
KBIM-TV, Roswell, New Mexico
KREZ-TV, Durango, Colorado

     B. Pursuant to the terms and subject to the conditions set forth in this Agreement, Seller desires to sell to Buyer, and Buyer desires to purchase from Seller, the Station Assets (defined below).

Agreement

     NOW, THEREFORE, taking the foregoing into account, and in consideration of the mutual covenants and agreements set forth herein, the parties, intending to be legally bound, hereby agree as follows:

ARTICLE 1: PURCHASE OF ASSETS

     1.1. Station Assets. On the terms and subject to the conditions hereof, at Closing (defined below), except as set forth in Sections 1.2 and 1.3, Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer shall purchase and acquire from Seller, all right, title and interest of Seller in and to all assets and properties of Seller, real and personal, tangible and intangible, that are used or held for use in the operation of the Stations (the “Station Assets”), free and clear of all Liens except Permitted Liens (defined below) including without limitation the following:

          (a) all licenses, permits and other authorizations issued to Seller by the FCC with respect to the Stations (the “FCC Licenses”), including those described on Schedule 1.1(a), including any renewals or modifications thereof between the date hereof and Closing;

          (b) all of Seller’s equipment, transmitters, antennas, cables, towers, vehicles, furniture, fixtures, spare parts and other tangible personal property of every kind and description that are used or held for use in the operation of the Stations, including without limitation those

 

listed on Schedule 1.1(b), except for any retirements or dispositions thereof made between the date hereof and Closing in the ordinary course of business (the “Tangible Personal Property”);

          (c) all of Seller’s real property used or held for use in the operation of the Stations (including any appurtenant easements and improvements located thereon), including without limitation those listed on Schedule 1.1(c) (the “Real Property”);

          (d) all agreements for the sale of advertising time on the Stations, and all other contracts, agreements and leases used in the Stations’ business, including without limitation those listed on Schedule 1.1(d), together with all contracts, agreements and leases made between the date hereof and Closing in accordance with Article 4 (the “Station Contracts”);

          (e) all of Seller’s rights in and to the following (the “Intangible Property”): the Stations’ call letters and Seller’s rights in and to the trademarks, trade names, service marks, internet domain names, copyrights, programs and programming material, jingles, slogans, logos, and other intangible property which are used or held for use in the operation of the Stations, including without limitation those listed on Schedule 1.1(e); and

          (f) Seller’s rights in and to all the files, documents, records, and books of account (or copies thereof) relating to the operation of the Stations, including the Stations’ local public files, programming information and studies, engineering data, advertising studies, marketing and demographic data, sales correspondence, lists of advertisers, credit and sales reports, and logs, but excluding records relating to Excluded Assets (defined below).

     1.2. Excluded Assets. Notwithstanding anything to the contrary contained herein, the Station Assets shall not include the following assets or any rights, title and interest therein (the “Excluded Assets”):

          (a) all cash and cash equivalents of Seller, including without limitation certificates of deposit, commercial paper, treasury bills, marketable securities, money market accounts and all such similar accounts or investments;

          (b) all tangible and intangible personal property of Seller retired or disposed of between the date of this Agreement and Closing in accordance with Article 4;

          (c) all Station Contracts that are terminated or expire prior to Closing in accordance with Article 4;

          (d) Seller’s corporate and trade names unrelated to the operation of the Stations (including the name “Emmis”), charter documents, and books and records relating to the organization, existence or ownership of Seller, duplicate copies of the records of the Stations, and all records not relating to the operation of the Stations;

          (e) all contracts of insurance, all coverages and proceeds thereunder and all rights in connection therewith, including without limitation rights arising from any refunds due with respect to insurance premium payments to the extent related to such insurance policies;

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          (f) all pension, profit sharing plans and trusts and the assets thereof and any other employee benefit plan or arrangement and the assets thereof, if any, maintained by Seller and any affiliates of Seller;

          (g) the Stations’ accounts receivable and any other rights to payment of cash consideration (including without limitation all rights to payments under the Stations’ network affiliation agreements, whether or not offset) for goods or services sold or provided prior to the Effective Time (defined below) or otherwise arising during or attributable to any period prior to the Effective Time (the “A/R”);

          (h) any computer software and programs used in the operation of the Stations that are not transferable;

          (i) all rights and claims of Seller, whether mature, contingent or otherwise, against third parties with respect to the Stations and the Station Assets, to the extent arising during or attributable to any period prior to the Effective Time;

          (j) all deposits and prepaid expenses (and rights arising therefrom or related thereto), except to the extent Seller receives a credit therefor under Section 1.7;

          (k) all claims of Seller with respect to any Tax (defined below) refunds to the extent attributable to a taxable period ending on or prior to the Effective Time;

          (l) computers and other assets located at the Emmis Communications Corporation headquarters, and the centralized server facility, data links, payroll system and other operating systems and related assets that are used in the operation of multiple stations; and

          (m) the assets listed on Schedule 1.2, and the slogan “Great Media, Great People, Great Service.”

     1.3. Shared Assets.

          (a) Some of the Station Contracts may be used in the operation of multiple stations or other business units (the “Shared Contracts”) and are identified on Schedule 1.1(d). The rights and obligations under the Shared Contracts shall be equitably allocated among stations in a manner reasonably determined by Seller in accordance with the following equitable allocation principles:

                    (i) any allocation set forth in the Shared Contract shall control;

                    (ii) if none, then any allocation previously made by Seller in the ordinary course of Station operations shall control;

                    (iii) if none, then the quantifiable proportionate benefit to be received by the parties after Closing shall control; and

                    (iv) if not quantifiable, then reasonable accommodation shall control.

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Price and any interest accrued thereon shall be disbursed to Buyer. If this Agreement is terminated by Seller pursuant to Section 10.1(c), the Deposit and any interest accrued thereon shall be disbursed to Seller and credited as partial payment of liquidated damages under Section 10.5. If this Agreement is terminated for any other reason, the Deposit and any interest accrued thereon shall be disbursed to Buyer. The parties shall each instruct the Escrow Agent to disburse the Deposit and all interest thereon to the party entitled thereto and shall not, by any act or omission, delay or prevent any such disbursement. Any failure by Buyer to make the Deposit within one (1) business day of the date hereof constitutes a material default as to which the Cure Period under Section 10.1 does not apply entitling Seller to immediately terminate this Agreement.

     1.7. Prorations and Adjustments.

          (a) All prepaid and deferred income and expenses relating to the Station Assets and arising from the operation of the Stations shall be prorated between Buyer and Seller in accordance with accounting principles generally accepted in the United States (“GAAP”) as of 12:01 a.m. on the day of Closing (the “Effective Time”). Such prorations shall include without limitation all music and other license fees, employee performance incentives set forth in employment agreements or annual compensation plans, any vacation for Transferred Employees (defined below) (except accruals for the fiscal year of Seller in which Closing occurs for which there shall be no adjustment), utility expenses, rent and other amounts under Station Contracts and similar prepaid and deferred items. Seller shall receive a credit for all of the Stations’ deposits and prepaid expenses. Sales commissions related to the sale of advertisements broadcast on the Stations prior to Closing shall be the responsibility of Seller, and sales commissions related to the sale of advertisements broadcast on the Stations after Closing shall be the responsibility of Buyer. All Taxes, other than transfer taxes, related to the Station Assets accrued or accruable with respect to events occurring on or prior to the Effective Time shall be borne by Seller. All Taxes related to the Station Assets accrued or accruable with respect to events occurring after the Effective Time shall be borne by Buyer. Ad valorem, real estate and other property Taxes (except transfer taxes as provided by Section 11.1), if any, with respect to the Station Assets shall be pro-rated on a per diem basis.

          (b) With respect to trade, barter or similar agreements for the sale of time for goods or services assumed by Buyer pursuant to Section 1.1(d), if at Closing the Stations have an aggregate negative or positive barter balance (i.e., the amount by which the value of air time to be provided by the Stations after the Effective Time exceeds, or conversely, is less than, the fair market value of corresponding goods and services), there shall be no proration or adjustment, unless the negative or positive barter balance of the Stations as an aggregate exceeds $50,000 per Station, in which event such excess or deficiency, as the case may be, shall be treated either as prepaid time sales or a receivable of Seller, and adjusted for as a proration in Buyer’s or Seller’s favor, as applicable. In determining barter balances, the value of air time shall be based upon Seller’s rates as of Closing, and corresponding goods and services shall include those to be received by the Stations after Closing plus those received by the Stations before Closing to the extent conveyed by Seller to Buyer as a part of the Station Assets.

          (c) No later than three (3) business days prior to the scheduled Closing date, Seller shall provide Buyer with a statement setting forth a reasonably detailed computation of Seller’s reasonable and good faith estimate of the Adjustment Amount (defined below) as of

Closing (the “Preliminary Adjustment Report”). As used herein, the “Adjustment Amount” means the net amount by which the Purchase Price is to be increased or decreased in accordance with this Section 1.7. If the Adjustment Amount reflected on the Preliminary Adjustment Report is a credit to Buyer, then the Purchase Price payable at Closing shall be reduced by the amount of the preliminary Adjustment Amount, and if the Adjustment Amount reflected on the Preliminary Adjustment Report is a charge to Buyer, then the Purchase Price payable at Closing shall be increased by the amount of such preliminary Adjustment Amount. For a period of ninety (90) days after Closing, Seller and its auditors and Buyer and its auditors may review the Preliminary Adjustment Report and the related books and records of Seller with respect to the Stations, and Buyer and Seller will in good faith seek to reach agreement on the final Adjustment Amount. If agreement is reached within such 90-day period, then promptly thereafter Seller shall pay to Buyer or Buyer shall pay to Seller, as the case may be, an amount equal to the difference between (i) the agreed Adjustment Amount and (ii) the preliminary Adjustment Amount indicated in the Preliminary Adjustment Report. If agreement is not reached within such 90-day period, then the dispute resolutions of Section 1.7(d) shall apply.

          (d) If the parties do not reach an agreement on the Adjustment Amount within the 90-day period specified in Section 1.7(c), then Seller and Buyer shall select an independent accounting firm of recognized national standing (the “Arbitrating Firm”) to resolve the disputed items. If Seller and Buyer do not agree on the Arbitrating Firm within five (5) calendar days after the end of such 90-day period, then the Arbitrating Firm shall be a nationally recognized independent accounting firm selected by lot (after excluding one firm designated by Seller and one firm designated by Buyer). Buyer and Seller shall each inform the Arbitrating Firm in writing as to their respective positions with respect to the Adjustment Amount, and each shall make available to the Arbitrating Firm any books and records and work papers relevant to the preparation of the Arbitrating Firm’s computation of the Adjustment Amount. The Arbitrating Firm shall be instructed to complete its analysis within thirty (30) days from the date of its engagement and upon completion to inform the parties in writing of its own determination of the Adjustment Amount, the basis for its determination and whether its determination is within the Mid-Range (defined below) or if not, whether it is closer to Buyer’s or Seller’s written determination of the Adjustment Amount. Any determination by the Arbitrating Firm in accordance with this Section shall be final and binding on the parties. Within five (5) calendar days after the Arbitrating Firm delivers to the parties its written determination of the Adjustment Amount, Seller shall pay to Buyer, or Buyer shall pay to Seller, as the case may be, an amount equal to the difference between (i) the Adjustment Amount as determined by the Arbitrating Firm and (ii) the preliminary Adjustment Amount indicated in the Preliminary Adjustment Report.

          (e) If the Arbitrating Firm’s determination of the Adjustment Amount is within the Mid-Range, then Seller and Buyer shall each pay one-half of the fees and disbursements of the Arbitrating Firm in connection with its analysis. If not, then (i) if the Arbitrating Firm determines that the written position of Buyer concerning the Adjustment Amount is closer to its own determination, then Seller shall pay the fees and disbursements of the Arbitrating Firm in connection with its analysis, or (ii) if the Arbitrating Firm determines that the written position of Seller concerning the Adjustment Amount is closer to its own determination, then Buyer shall pay the fees and disbursements of the Arbitrating Firm in connection with its analysis. As used herein, the term “Mid-Range” means a range that (i) equals twenty percent (20%) of the absolute difference between the written positions of Buyer and Seller as to the Adjustment Amount and (ii) has a midpoint equal to the average of such written positions of Buyer and Seller.

          (f) Concurrently with the payment of any amount required to be paid under Section 1.7(c) or (d), the payor shall pay the payee interest on such amount for the period from the Closing Date until the date paid at a rate equal to seven percent (7%) per annum. All payments to be made under Section 1.7 shall be paid by wire transfer in immediately available funds to the account of the payee at a financial institution in the United States and shall for all purposes constitute an adjustment to the Purchase Price.

     1.8. Allocation. After Closing, Buyer and Seller will allocate the Purchase Price in accordance with the respective fair market values of the Station Assets and the goodwill being purchased and sold in accordance with the requirements of Section 1060 of the Internal Revenue Code of 1986, as amended (the “Code”) based upon an appraisal by a nationally recognized broadcast appraiser acceptable to Buyer and Seller (whose fees shall be paid one-half by Seller and one-half by Buyer). Buyer and Seller shall file its federal income tax returns and its other tax returns reflecting the allocation made pursuant to this Section.

     1.9. Closing. The consummation of the sale and purchase of the Station Assets provided for in this Agreement (the “Closing”) shall take place on the fifth business day after the date of the FCC Consent pursuant to the FCC’s initial order (or on such earlier day after such consent as Buyer and Seller may mutually agree), subject to the satisfaction or waiver of the conditions set forth in Articles 6 or 7 below. The date on which the Closing is to occur is referred to herein as the “Closing Date.”

     1.10. Governmental Consents.

          (a) Within five (5) business days of the date of this Agreement, Buyer and Seller shall file an application with the FCC (the “FCC Application”) requesting FCC consent to the assignment of the FCC Licenses to Buyer. FCC consent to the assignment of the main station FCC Licenses to Buyer is referred to herein as the “FCC Consent.” Buyer and Seller shall diligently prosecute the FCC Application and otherwise use their commercially reasonable efforts to obtain the FCC Consent as soon as possible.

          (b) If applicable, within ten (10) business days after the date of this Agreement, Buyer and Seller shall make any required filings with the Federal Trade Commission and the United States Department of Justice pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) with respect to the transactions contemplated hereby (including a request for early termination of the waiting period thereunder), and shall thereafter promptly respond to all requests received from such agencies for additional information or documentation. Expiration or termination of any applicable waiting period under the HSR Act is referred to herein as “HSR Clearance.”

          (c) Buyer and Seller shall notify each other of all documents filed with or received from any governmental agency with respect to this Agreement or the transactions contemplated hereby. Buyer and Seller shall furnish each other with such information and assistance as the other may reasonably request in connection with their preparation of any governmental filing hereunder. The FCC Consent and HSR Clearance are referred to herein collectively as the “Governmental Consents.”

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     1.11. Renewal. The main station FCC Licenses expire on the dates set forth on Schedule 1.1(a). If due prior to Closing and if not previously filed, then Seller shall timely file FCC renewal applications with respect to the Stations and thereafter prosecute such applications. The parties acknowledge that under current FCC policy, either the FCC will not grant an assignment application while a renewal application is pending, or the FCC will grant an assignment application with a renewal condition. If the FCC Application is granted subject to a renewal condition, then the term “FCC Consent” shall mean FCC consent to the FCC Application and satisfaction of such renewal condition.

     1.12. Multiple Closings. Notwithstanding anything in this Agreement to the contrary:

          (a) the parties have allocated the Stations into groups (each a “Station Group”) and have allocated the Purchase Price (each an “Allocated Price”) as follows:

Station Group		Stations		Allocated Price
Albuquerque Group		KRQE(TV), Albuquerque, New Mexico		$	74,000,000
		KBIM-TV, Roswell, New Mexico
Durango Group		KREZ-TV, Durango, Colorado		$	1,000,000
Mobile Group		WALA-TV, Mobile, Alabama		$	85,000,000
		WBPG(TV), Gulf Shores, Alabama
Green Bay Group		WLUK-TV, Green Bay, Wisconsin		$	60,000,000
Terre Haute Group		WTHI-TV, Terre Haute, Indiana		$	40,000,000

          (b) the FCC Application shall consist of separate applications (each a “Partial Application”), one for each Station Group, and the transactions contemplated by this Agreement shall be consummated as follows: (i) if such applications are granted concurrently, then in a single Closing, or (ii) if not, then in multiple Closings (each a “Partial Closing”), one for each Station Group;

          (c) with respect to each Station Group, each Partial Closing shall occur on the fifth business day after the date of the FCC Consent with respect to the applicable Partial Application (subject to the satisfaction or waiver of the applicable conditions set forth in Articles 6 or 7 below), except that if the day the Durango Group Partial Closing is otherwise scheduled to occur is before the Albuquerque Group Partial Closing, then the Durango Group Partial Closing shall be scheduled for the date of the Albuquerque Group Partial Closing;

          (d) at each Partial Closing Seller shall convey to Buyer the Station Assets used or held for use in the operation of the Stations in the applicable group and Buyer shall pay Seller the Allocated Price for such group; and

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          (e) taking into account such multiple closings:

                    (i) the terms “Closing,” “Closing Date,” “FCC Application” and “FCC Consent” shall mean, and refer separately to, the applicable Partial Closing, the date on which such Partial Closing occurs (or is to occur), the applicable Partial Application, and the applicable FCC consent, each as the context requires;

                    (ii) with respect to each Station Group and each Partial Closing, the provisions of this Agreement that apply before, at or after a Closing shall apply before, at or after the applicable Partial Closing;

                    (iii) the Deposit shall be allocated and disbursed pro rata according to the Allocated Price to be paid at each Partial Closing, and the term “Deposit” as used herein shall mean, and refer separately to the allocable portion thereof as the context requires (but shall mean the full amount thereof if this Agreement is terminated without any Closing);

                    (iv) for purposes of Section 9.2, with respect to each Partial Closing, the maximum liability amount shall be determined based upon the Allocated Price for such Partial Closing;

                    (v) for purposes of Section 10.5, after each Partial Closing the liquidated damage amount shall be determined based upon the Allocated Price for the Station Groups for which a Partial Closing has not occurred;

                    (vi) any termination of this Agreement prior to the first Partial Closing shall constitute a termination of this Agreement in its entirety, but after the first Partial Closing, any termination of this Agreement shall constitute a termination only with respect to the Station Assets not subject to any prior Partial Closing, each Partial Closing being final and non-rescindable; and

                    (vii) with respect to the Albuquerque Group and the Durango Group, the Outside Date (defined below) shall be May 31, 2006.

          (f) Without limiting the parties’ obligations under this Section 1.12 to do Partial Closings, the parties agree to consult with one-another in an effort to minimize the number of Partial Closings to the extent circumstances warrant, but no such consultation is a condition to Closing.

ARTICLE 2: SELLER REPRESENTATIONS AND WARRANTIES

     Seller makes the following representations and warranties to Buyer:

     2.1. Organization. Seller is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and is qualified to do business in each jurisdiction in which the Station Assets are located. Seller has the requisite power and authority to execute, deliver and perform this Agreement and all of the other agreements and instruments to be made by Seller pursuant hereto (collectively, the “Seller Ancillary Agreements”) and to consummate the transactions contemplated hereby.

     2.2. Authorization. The execution, delivery and performance of this Agreement and the Seller Ancillary Agreements by Seller have been duly authorized and approved by all necessary action of Seller and do not require any further authorization or consent of Seller. This Agreement is, and each Seller Ancillary Agreement when made by Seller and the other parties thereto will be, a legal, valid and binding agreement of Seller enforceable in accordance with its terms, except in each case as such enforceability may be limited by bankruptcy, moratorium, insolvency, reorganization or other similar laws affecting or limiting the enforcement of creditors’ rights generally and except as such enforceability is subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

     2.3. No Conflicts. Except as set forth on Schedule 2.3 and except for the Governmental Consents and consents to assign certain of the Station Contracts as set forth on Schedule 1.1(c) or Schedule 1.1(d), the execution, delivery and performance by Seller of this Agreement and the Seller Ancillary Agreements and the consummation by Seller of any of the transactions contemplated hereby does not (i) conflict with any organizational documents of Seller, (ii) conflict with, result in a breach of or give rise to a right of termination or acceleration or constitute a default under any Station Contracts, (iii) conflict with any law, judgment, order, or decree to which Seller is subject, or (iv) require the consent or approval of, or a filing by Seller with, any governmental or regulatory authority or any third party.

     2.4. FCC Licenses. Except as set forth on Schedule 1.1(a):

          (a) Seller is the holder of the FCC Licenses described on Schedule 1.1(a), which are all of the FCC licenses, permits and authorizations required for the present operation of the Stations. The FCC Licenses are in full force and effect and have not been revoked, suspended, canceled, rescinded or terminated and have not expired. There is not pending any action by or before the FCC to revoke, suspend, cancel, rescind or materially adversely modify any of the FCC Licenses (other than proceedings to amend FCC rules of general applicability). There is not issued or outstanding, by or before the FCC, any order to show cause, notice of violation, notice of apparent liability, or order of forfeiture against the Stations or against Seller with respect to the Stations that could result in any such action. The Stations are operating in compliance in all material respects with the FCC Licenses, the Communications Act of 1934, as amended (the “Communications Act”), and the rules, regulations and policies of the FCC.

          (b) Each Station has been assigned a channel by the FCC for the provision of digital television (“DTV”) service, and the FCC Licenses include such authorization. The Stations are broadcasting the DTV signal in accordance with such authorization in all material respects.

     2.5. Taxes.

          (a) Seller has, in respect of the Stations’ business, filed all Tax Returns (defined below) required to have been filed by it under applicable law, and has paid all Taxes which have become due pursuant to such Tax Returns or pursuant to any assessments which have become payable. Seller is not a foreign person within the meaning of Section 1445 of the Code.

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          (b) As used herein, (i) “Tax” (and, in the plural, “Taxes”) shall mean (A) any domestic or foreign federal, state or local taxes, charges, fees, levies, imposts, duties and governmental fees or other like assessments or charges of any kind whatsoever (including without limitation any income, net income, gross income, receipts, windfall profit, severance, property, production, sales, use, license, excise, registration, franchise, employment, payroll, withholding, alternative or add-on minimum, intangibles, ad valorem, transfer, gains, stamp, estimated, transaction, title, capital, paid-up capital, profits, occupation, premium, value-added, recording, real property, personal property, inventory and merchandise, business privilege, federal highway use, commercial rent or environmental tax), and (B) all interest, penalties, fines, additions to tax or additional amounts imposed by any taxing authority in connection with any item described in clause (A), and (ii) “Tax Returns” shall mean any return, report or statement required to be filed with respect to any Tax (including any attachments thereto and any amendments thereof) including without limitation any information return, claim for refund, amended return or declaration of estimated Tax, and including, where permitted or required, consolidated, combined or unitary returns for any group of entities that includes any Seller.

     2.6. Personal Property. Schedule 1.1(b) contains a list of material items of Tangible Personal Property included in the Station Assets, subject to Section 1.3(c). Except as set forth on Schedule 1.1(b), Seller has good and marketable title to the Tangible Personal Property free and clear of liens, claims and encumbrances (“Liens”) other than Permitted Liens (defined below). Except as set forth on Schedule 1.1(b) or Schedule 1.1(d), to Seller’s knowledge, Seller has good and marketable title to the shares of stock in Sandia Television Corporation referenced on Schedule 1.1(d) free and clear Liens other than Permitted Liens. Except as set forth on Schedule 1.1(b), all material items of Tangible Personal Property are in normal operating condition, ordinary wear and tear excepted. As used herein, “Permitted Liens” means, collectively, the Assumed Obligations, the shared use arrangements described in Section 1.3, liens for taxes not yet due and payable, liens that will be released at or prior to Closing, and such other easements, rights of way, building and use restrictions, exceptions, reservations and limitations that do not in any material respect detract from the value of the property subject thereto or impair the use thereof in the ordinary course of the business of the Stations.

     2.7. Real Property. Schedule 1.1(c) contains a description of all Real Property included in the Station Assets, subject to Section 1.3(c). Seller has good and marketable fee simple title to the owned Real Property described on Schedule 1.1(c) (the “Owned Real Property”) free and clear of Liens other than Permitted Liens. Schedule 1.1(c) includes a description of each lease of Real Property or similar agreement included in the Station Contracts (the “Real Property Leases”). To Seller’s knowledge, the Real Property is not subject to any suit for condemnation or other taking by any public authority. Except for the Excluded Assets, the Owned Real Property and the Real Property Leases are the only real property now used by Seller in the operation of the Stations. No other person has an option to acquire any of the Real Property.

     2.8. Contracts. Except as set forth on Schedule 1.1(d), each of the Station Contracts (including without limitation each of the Real Property Leases) is in effect and is binding upon Seller and, to Seller’s knowledge, the other parties thereto (subject to bankruptcy, insolvency, reorganization or other similar laws relating to or affecting the enforcement of creditors’ rights generally). Seller has performed its obligations under each of the Station Contracts in all material respects, and is not in material default thereunder, and to Seller’s knowledge, no other party to any of the Station Contracts is in default thereunder in any material respect.

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     5.1. Confidentiality. Seller (or The Blackstone Group, LLC on behalf of Seller) and Buyer (or an affiliate of Buyer on behalf of Buyer) are parties to a non-disclosure agreement with respect to Seller and its television stations (the “NDA”). To the extent not already a direct party thereto, Seller and Buyer hereby assume the NDA and agree to be bound by the provisions thereof. Without limiting the terms of the NDA, subject to the requirements of applicable law, all non-public information regarding the parties and their business and properties that is disclosed in connection with the negotiation, preparation or performance of this Agreement (including without limitation all financial information provided by Seller to Buyer) shall be confidential and shall not be disclosed to any other person or entity, except in accordance with the terms of the NDA.

     5.2. Announcements. Prior to Closing, no party shall, without the prior written consent of the other, issue any press release or make any other public announcement concerning the transactions contemplated by this Agreement, except to the extent that such party is so obligated by law, in which case such party shall give advance notice to the other.

     5.3. Control. Buyer shall not, directly or indirectly, control, supervise or direct the operation of the Stations prior to Closing. Consistent with the Communications Act and the FCC rules and regulations, control, supervision and direction of the operation of the Stations prior to Closing shall remain the responsibility of Seller as the holder of the FCC Licenses.

     5.4. Risk of Loss.

          (a) Seller shall bear the risk of any loss of or damage to any of the Station Assets at all times until the Effective Time, and Buyer shall bear the risk of any such loss or damage thereafter.

          (b) If prior to the Effective Time any item of Tangible Personal Property is damaged or destroyed or otherwise not in the condition described in Section 2.6 in any material respect, then:

                    (i) Seller shall use commercially reasonable efforts to repair or replace such item in all material respects in the ordinary course of business,

                    (ii) Seller’s representations and warranties, and Buyer’s pre-Closing termination rights and post-Closing indemnification rights, are hereby modified to take into account any such condition, and

                    (iii) if such repair or replacement is not completed prior to Closing, then as Buyer’s sole remedy, the parties shall proceed to Closing and Seller shall repair or replace such item in all material respects after Closing (and Buyer will provide Seller access and any other reasonable assistance requested by Seller with respect to such obligation).

          (c) If a Station is off the air prior to Closing, then Seller shall use commercially reasonable efforts to return the Station to the air as promptly as practicable in the ordinary course of business. Notwithstanding anything herein to the contrary, if on the day otherwise scheduled for Closing a Station is off the air, then Closing shall be postponed until the date five (5) business days after the Station returns to the air, subject to Section 10.1.

     5.5. Environmental. Certain Phase I’s identified the items set forth on Schedule 1.1(c). With respect to such items:

                    (i) Seller shall have no duty to remediate such items, and

                    (ii) Seller’s representations and warranties, and Buyer’s pre-Closing termination rights and post-Closing indemnification rights, are hereby modified to take into account any such items.

     5.6. Consents.

          (a) The parties shall use commercially reasonable efforts to obtain (i) any third party consents necessary for the assignment of any Station Contract (which shall not require any payment to any such third party), and (ii) execution of reasonable estoppel certificates by lessors under any Real Property Leases requiring consent to assignment (if any), but no such consents or estoppel certificates are conditions to Closing except for the Required Consents (defined below). Receipt of consent to assign to Buyer the Stations’ unexpired (i) network affiliation agreements designated with a diamond on Schedule 1.1(d) and (ii) main tower leases designated with a diamond on Schedule 1.1(c) (if any) is a condition precedent to Buyer’s obligation to close under this Agreement (the “Required Consents”).

          (b) To the extent that any Station Contract may not be assigned without the consent of any third party, and such consent is not obtained prior to Closing, this Agreement and any assignment executed pursuant to this Agreement shall not constitute an assignment of such Station Contract; provided, however, with respect to each such Station Contract, Seller and Buyer shall cooperate to the extent feasible in effecting a lawful and commercially reasonable arrangement under which Buyer shall receive the benefits under the Station Contract from and after Closing, and to the extent of the benefits received, Buyer shall pay and perform Seller’s obligations arising under the Station Contract from and after Closing in accordance with its terms.

     5.7. Employees.

          (a) For a period of two (2) years from the date of this Agreement, Buyer shall not, without the prior written consent of Seller, solicit for employment, induce or attempt to induce to leave Seller’s or an affiliate of Seller’s employ, or hire, any employees of Seller or its affiliates staffed in Seller’s Indianapolis headquarters or at any other television station owned by Seller or its affiliates (other than (i) general solicitations not directed solely to any such employees; and (ii) any employment or hiring of such employees that results from such general solicitation).

          (b) If the Stations include any stations identified in Section 1.3(c) or 1.3(d), then any shared employees shall be allocated as set forth on Schedule 1.3. With respect to such shared employees, the terms of this Section 5.7 shall apply only to those who are allocated to Buyer pursuant to Schedule 1.3, and Buyer shall not solicit for hire those who are not allocated to Buyer (other than general solicitations not directed solely to any such employees).

          (c) Seller has provided Buyer a list showing employee positions and annualized pay rates for employees of the Stations. Except as provided by Section 5.7(b) and

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except for Excluded Employees (defined below), Buyer shall offer employment to all persons employed by Seller immediately prior to Closing (including any hired after the date hereof in the ordinary course of business or in connection with any bifurcation of operations contemplated by Schedule 1.3) upon substantially the same terms and conditions and with substantially the same duties as in effect immediately preceding the Closing, including but not limited to wages, salaries, commission rate (if applicable) and target bonuses (all determined on a cash basis before taking into account Seller’s stock compensation program) and with benefits which are substantially similar to the benefits Buyer provides to its similarly situated employees. As used herein the term “Excluded Employees” shall mean only those employees who are on inactive status (including employees who are inactive due to leave or short-term or long-term disability, as of the Closing Date. Buyer shall offer employment to Excluded Employees on the terms set forth above in this Section 5.7(c) subject to the following conditions: (i) if on medical or disability leave, when such individual is released by his or her physician to return to active employment, and (ii) such individual actually reports for active employment with Buyer immediately upon such medical release, and (iii) Buyer shall not be required to offer employment under this provision after six (6) months from the Closing Date or, if longer, after the expiration of any period required by applicable law. With respect to each employee who accepts such offer (collectively, the “Transferred Employees”), at Closing employment with Seller shall terminate and employment with Buyer shall commence. Without limiting the foregoing, if Buyer terminates the employment of any Transferred Employee within one (1) year after Closing, Buyer shall be responsible for any applicable severance in accordance with Seller’s severance policy (a copy of which has been provided to Buyer), unless the Transferred Employee is party to a written employment agreement that provides for a different severance obligation.

          (d) With respect to Transferred Employees, Seller shall be responsible for all compensation and benefits arising prior to the Effective Time, and Buyer shall be responsible for all compensation and benefits arising after the Effective Time. Notwithstanding anything herein to the contrary, Buyer shall grant credit to each Transferred Employee for all unused vacation accrued as of the Effective Time as an employee of Seller, and Buyer shall assume and discharge Seller’s obligation to provide such leave to such employees (such obligations being a part of the Assumed Obligations).

          (e) Buyer shall permit Transferred Employees (and their spouses and dependents) to participate in its “employee welfare benefit plans” (including without limitation health insurance plans) and “employee pension benefit plans” (as defined in Section 3(1) and 3(2) of ERISA, respectively) which are substantially similar to the employee benefits Buyer provides to its similarly situated employees, with coverage effective immediately upon Closing (and without exclusion from coverage on account of any pre-existing condition), with service with Seller deemed service with the Buyer for purposes of any length of service requirements, waiting periods, vesting periods and differential benefits based on length of service (but not accruals under defined benefits pension plans), and with credit under any welfare benefit plan for any deductibles or co-payments paid for the current plan year under any plan maintained by Seller.

          (f) Buyer shall also permit each Transferred Employee who participates in the Seller’s 401(k) plan to elect to make direct rollovers of their account balances into the Buyer’s 401(k) plan as of Closing, including the direct rollover of any outstanding loan balances such

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SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.

BUYER:		LIN TELEVISION CORPORATION
		By:
				Name:
				Title:
SELLER:		EMMIS TELEVISION BROADCASTING, L.P.
		By:		Emmis Operating Company, its general partner
		By:
				Name:
				Title:
		EMMIS TELEVISION LICENSE, LLC
		By:
				Name:
				Title:
		EMMIS INDIANA BROADCASTING, L.P.
		By:
				Name:
				Title: