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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



Form 10-K

ý   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012

or

o

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                                    to                                   

LIN TV Corp.
(Exact name of registrant as specified in its charter)

Commission File Number: 001-31311

LIN Television Corporation
(Exact name of registrant as specified in its charter)

Commission File Number: 000-25206

Delaware   Delaware
(State or other jurisdiction of incorporation or organization)   (State or other jurisdiction of incorporation or organization)

05-0501252

 

13-3581627
(I.R.S. Employer Identification No.)   (I.R.S. Employer Identification No.)

One West Exchange Street, Suite 5A, Providence, Rhode Island 02903
(Address of principal executive offices)

(401) 454-2880
(Registrant's telephone number, including area code)

          Securities Registered Pursuant to Section 12(b) of the Exchange Act:

Title of each class   Name of each exchange on which registered
Class A common stock, par value $0.01 per share   New York Stock Exchange

          Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o    No ý

          Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o    No ý

          Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

          Indicate by check mark whether the registrant has submitted electronically and posted to its corporate Web site, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding twelve months (or for such shorter period that the registrant was required to submit and post such files). Yes ý    No o

          Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

          Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o   Accelerated filer ý   Non-accelerated filer o
(Do not check if a
smaller reporting company)
  Smaller reporting company o

          Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.) Yes o    No ý

          The aggregate market value of the voting and non-voting common equity held by non-affiliates (based on the last reported sale price of the registrant's class A common stock on June 30, 2012 on the New York Stock Exchange) was approximately $165 million.

Document Description   Form 10-K
Portions of the Registrant's Proxy Statement on Schedule14A for the Annual Meeting of Stockholders to be held on May 29, 2013   Part III

DOCUMENTS INCORPORATED BY REFERENCE

NOTE:

          This combined Form 10-K is separately filed by LIN TV Corp. and LIN Television Corporation. LIN Television Corporation meets the conditions set forth in general instruction I(1) (a) and (b) of Form 10-K and is, therefore, filing this form with the reduced disclosure format permitted by such instruction.

          LIN TV Corp. Class A common stock, $0.01 par value, issued and outstanding as of March 7, 2013: 30,827,550 shares.

          LIN TV Corp. Class B common stock, $0.01 par value, issued and outstanding as of March 7, 2013: 23,401,726 shares.

          LIN TV Corp. Class C common stock, $0.01 par value, issued and outstanding as of March 7, 2013: 2 shares.

          LIN Television Corporation common stock, $0.01 par value, issued and outstanding as of March 7, 2013: 1,000 shares.

   


Table of Contents


Table of Contents

PART I

   

Item 1.

 

Business

  4

Item 1A.

 

Risk Factors

  23

Item 1B.

 

Unresolved Staff Comments

  35

Item 2.

 

Properties

  35

Item 3.

 

Legal Proceedings

  35

Item 4.

 

Mine Safety Disclosures

  35

PART II

   

Item 5.

 

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

  36

Item 6.

 

Selected Financial Data

  38

Item 7.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

  40

Item 7A.

 

Quantitative and Qualitative Disclosures About Market Risk

  62

Item 8.

 

Financial Statements and Supplementary Data

  63

Item 9.

 

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

  63

Item 9A.

 

Controls and Procedures

  63

Item 9B.

 

Other Information

  64

PART III

   

Item 10.

 

Directors and Executive Officers and Corporate Governance

  64

Item 11.

 

Executive Compensation

  64

Item 12.

 

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

  65

Item 13.

 

Certain Relationships and Related Transactions and Director Independence

  65

Item 14.

 

Principal Accounting Fees and Services

  65

PART IV

   

Item 15.

 

Exhibits and Financial Statements Schedules

  66

Schedule I

 

Condensed Financial Information of the Registrant

  F-112


EXHIBITS


 

 

4.3

 

Supplemental Indenture

   

4.5

 

Supplemental Indenture

   

21

 

Subsidiaries of the Registrant

   

23.1

 

Consent of PricewaterhouseCoopers LLP

   

23.2

 

Consent of PricewaterhouseCoopers LLP

   

23.3

 

Consent of Deloitte and Touche LLP

   

23.4

 

Consent of KPMG LLP

   

31.1

 

Certification pursuant to Section 302 of the CEO of LIN TV Corp.

   

31.2

 

Certification pursuant to Section 302 of the CFO of LIN TV Corp.

   

31.3

 

Certification pursuant to Section 302 of the CEO of LIN Television Corporation

   

31.4

 

Certification pursuant to Section 302 of the CFO of LIN Television Corporation

   

32.1

 

Certification pursuant to Section 906 of the CEO and CFO of LIN TV Corp.

   

32.2

 

Certification pursuant to Section 906 of the CEO and CFO of LIN Television Corporation

101.INS**

 

XBRL Instance Document

   

101.SCH**

 

XBRL Taxonomy Extension Schema Document

   

101.CAL**

 

XBRL Taxonomy Extension Calculation Linkbase Document

   

101.LAB**

 

XBRL Taxonomy Extension Label Linkbase Document

   

101.PRE**

 

XBRL Taxonomy Extension Presentation Linkbase Document

   

101.DEF**

 

XBRL Taxonomy Extension Definition Linkbase Document

   

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SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS

        This report contains certain forward-looking statements with respect to our financial condition, results of operations and business, including statements under the captions Item 1. "Business" and Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations". All of these forward-looking statements are based on estimates and assumptions made by our management, which, although we believe them to be reasonable, are inherently uncertain. Therefore, you should not place undue reliance upon such estimates or statements. We cannot assure you that any of such estimates or statements will be realized and actual results may differ materially from those contemplated by such forward-looking statements. Factors that may cause such differences include those discussed under the caption Item 1A. "Risk Factors", as well as the following:

    volatility and periodic changes in our advertising revenues;

    economic conditions, including adverse changes in the national and local economies in which our stations operate and volatility and disruption of the capital and credit markets;

    effects of complying with accounting standards, including with respect to the treatment of our intangible assets;

    inability or unavailability of additional debt or equity capital;

    restrictions on our operations due to, and the effect of, our significant indebtedness;

    our ability to continue to comply with financial debt covenants dependent on cash flows;

    increased competition, including from newer forms of entertainment and entertainment media, changes in distribution methods or changes in the popularity or availability of programming;

    increased costs, including increased news and syndicated programming costs and increased capital expenditures as a result of acquisitions or necessary technological enhancements;

    effects of our control relationships, including the control that HM Capital Partners I LP ("HMC") and its affiliates have with respect to corporate transactions and activities we undertake;

    adverse state or federal legislation or regulation or adverse determinations by regulators, including adverse changes in, or interpretations of, the exceptions to the Federal Communications Commission ("FCC") duopoly rule and the allocation of broadcast spectrum;

    declines in the domestic advertising market;

    further consolidation of national and local advertisers;

    global or local events that could disrupt television broadcasting;

    risks associated with acquisitions including integration of acquired businesses;

    changes in television viewing patterns, ratings and commercial viewing measurement;

    changes in our television network affiliation agreements;

    changes in our retransmission consent agreements;

    seasonality of the broadcast business due primarily to political advertising revenues in even years;

    tax impact of the joint venture sale transaction; and

    effects of the merger transaction pursuant to which LIN TV Corp. will be merged with and into a wholly-owned subsidiary, LIN Media LLC, including the potential impact to the value of our stock price leading up to and as a result of the merger and the potential adverse effect on our liquidity if the merger is not consummated.

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        Many of these factors are beyond our control. Forward-looking statements contained herein speak only as of the date hereof. We undertake no obligation to publicly release the result of any revisions to these forward-looking statements, to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

PART I

Item 1.    Business

Overview

        LIN TV Corp. ("LIN TV") is a local multimedia company that currently owns, operates or services 43 television stations and seven digital channels in 23 U.S. markets, along with a diverse portfolio of web sites, apps and mobile products that make it more convenient to access our unique and relevant content on multiple screens. Our highly-rated television stations deliver superior local news, community service, and popular sports and entertainment programming to viewers, reaching 10.5% of U.S. television homes. All of our television stations are affiliated with a national broadcast network and are primarily located in the top 75 Designated Market Areas ("DMAs") as measured by Nielsen Media Research ("Nielsen"). Our digital media division operates from 28 markets across the country, including New York City, Los Angeles, Chicago and Austin, and delivers measurable results to some of the nation's most respected agencies and companies. In this report, the terms "Company," "we," "us" or "our" mean LIN TV Corp. and all subsidiaries included in our consolidated financial statements. Our class A common stock is traded on the New York Stock Exchange ("NYSE") under the symbol "TVL".

        We provide free, over-the-air broadcasts of our programming 24 hours per day to the communities we are licensed to serve. We are committed to serving the public interest by making advertising time available to political candidates, by providing free daily local news coverage, making public service announcements and broadcasting children's programming.

        We seek to have the largest local media presence in each of our local markets by combining strong network and syndicated programming with leading local news, and by pursuing our multi-channel strategy. We also deliver our content online and on mobile applications, which we believe could provide a significant revenue stream to the television broadcasting industry. Mobile digital broadcast television enables consumers to watch live television on their laptops, smartphones, tablet computers and other mobile devices. We expect over-the-air television delivered to mobile and out-of-home devices in our local markets to meet the growing demand of on-the-go consumers. Additionally, we invest in companies that focus on emerging media and interactive technologies to expand our local multi-platform and digital product offerings.

Development of Our Business

Ownership and organizational structure

        We are a Delaware corporation incorporated on February 11, 1998. Our Company (including its predecessors) has owned and operated television stations since 1966. LIN Television Corporation ("LIN Television"), our wholly-owned subsidiary, is a Delaware corporation and was incorporated on June 18, 1990. On May 3, 2002, we completed our initial public offering and our class A common stock began trading on the NYSE. Our corporate offices are at One West Exchange Street, Suite 5A, Providence, Rhode Island 02903.

        We have three classes of common stock. The class A common stock and the class C common stock are both voting common stock, with the class C common stock having 70% of the aggregate voting power. The class B common stock is held by current and former affiliates of HMC and has no voting rights, except that without the consent of a majority of the class B common stock, we cannot enter into a wide range of corporate transactions.

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        This capital structure allowed us to issue voting stock while preserving the pre-existing ownership structure in which the class B stockholders did not have an attributable ownership interest in our television broadcast licenses pursuant to the rules of the FCC.

        The following diagram summarizes our corporate structure as of March 7, 2013:

GRAPHIC

        All of the shares of our class B common stock are held by affiliates of HMC or former affiliates of HMC. The class B common stock is convertible into class A common stock or class C common stock in various circumstances. The class C common stock is also convertible into class A common stock in certain circumstances. If affiliates of HMC converted their shares of class B common stock into shares of class A common stock and the shares of class C common stock were converted into shares of class A common stock as of March 7, 2013, the holders of the converted shares of class C common stock would own less than 0.01% of the total outstanding shares of class A common stock and resulting voting power, and the affiliates of HMC would own 43.1% of the total outstanding shares of class A common stock and resulting voting power.

    Our television stations

        We own, operate or service 43 television stations and seven digital channels in 23 U.S. markets, including two television stations and one digital channel pursuant to local marketing agreements, six affiliates pursuant to joint sales and shared services agreements, two affiliates pursuant to shared services agreements, and three low-power stations, which are affiliated with a national network and operate as

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stand-alone stations. The following table lists the stations and digital channels that we own, operate or service:

Market(1)
  DMA Rank(2)   Station   Affiliation(s)   Channel   Status(3)   FCC license
expiration
 

Portland, OR

    22   KOIN-TV   CBS   40         2/1/2015  

Indianapolis, IN

    26   WISH-TV(4)   CBS   9         8/1/2013  

        WNDY-TV   MNTV   32         8/1/2013  

Hartford-New Haven, CT

    30   WTNH-TV   ABC   10         4/1/2015  

        WCTX-TV   MNTV   39         4/1/2015  

Grand Rapids-Kalamazoo-Battle Creek, MI

    39   WOOD-TV(4)   NBC   7         10/1/2013  

        WOTV-TV   ABC   20         10/1/2013  

        WXSP-CD   MNTV   Various         10/1/2013  

Birmingham, AL

    42   WIAT-TV   CBS   30         4/1/2013  

Norfolk-Portsmouth-Newport News, VA

    44   WAVY-TV(4)   NBC   31         10/1/2012(6)  

        WVBT-TV   FOX   29         10/1/2012(6)  

Austin, TX

    45   KXAN-TV   NBC   21         8/1/2014  

        KNVA-TV(4)   CW   49   LMA     8/1/2014  

        KBVO-TV(5)   MNTV   27         8/1/2014  

Albuquerque, NM

    47   KRQE-TV(4)   CBS   13         10/1/2014  

        KASA-TV(4)   FOX   27         10/1/2014  

        KWBQ-TV(4)   CW   29   SSA     10/1/2014  

        KASY-TV   MNTV   45   SSA     10/1/2014  

Buffalo, NY

    52   WIVB-TV   CBS   39         6/1/2015  

        WNLO-TV   CW   32         6/1/2015  

Providence, RI-New Bedford, MA

    53   WPRI-TV   CBS   13         4/1/2015  

        WNAC-TV   FOX   12   LMA     4/1/2007 (6)

        WNAC-TV-D2   MNTV   12.2   LMA     4/1/2007 (6)

Mobile, AL/Pensacola, FL

    60   WALA-TV   FOX   9         4/1/2013  

        WFNA-TV   CW   25         4/1/2013  

Dayton, OH

    63   WDTN-TV   NBC   50         10/1/2013  

        WBDT-TV   CW   26   SSA/JSA     10/1/2013  

Wichita-Hutchinson, KS

    66   KSNW-TV(4)   NBC   45         6/1/2014  

        KSNG-TV-D2   TEL   11.2         6/1/2014  

Green Bay-Appleton, WI

    69   WLUK-TV(4)   FOX   11         12/1/2013  

        WCWF-TV   CW   21         12/1/2013  

Honolulu, HI

    71   KHON-TV(4)   FOX   8         2/1/2015  

        KHON-TV-D2   CW   8.2         2/1/2015  

Savannah, GA

    92   WJCL-TV   ABC   22         4/1/2013  

        WTGS-TV   FOX   28   SSA/JSA     12/1/2012(6)  

Fort Wayne, IN

    109   WANE-TV   CBS   31         8/1/2013  

Youngstown, OH

    110   WYTV-DT   ABC   36   SSA/JSA     10/1/2013  

        WKBN-TV   CBS   41         10/1/2013  

        WYFX-LD   FOX   19         10/1/2013  

        WYTV-DT2   MNTV   36.2   SSA/JSA     10/1/2013  

Springfield-Holyoke, MA

    114   WWLP-TV(4)   NBC   11         4/1/2015  

Topeka, KS

    136   KTKA-TV   ABC   49   SSA/JSA     6/1/2014  

        KTKA-TV-D3   CW   49.3   SSA/JSA     6/1/2014  

        KSNT-TV(4)   NBC   27         6/1/2014  

        KTMJ-CD   FOX   43         6/1/2014  

Mason City, IA

    153   KIMT-TV   CBS   42         2/1/2014  

        KIMT-TV-DT2   MNTV   42.2         2/1/2014  

Terre Haute, IN

    154   WTHI-TV(4)   CBS   10         8/1/2013  

        WTHI-TV-D2   FOX   10.2         8/1/2013  

Lafayette, IN

    189   WLFI-TV   CBS   11         8/1/2013  

(1)
On February 12, 2013, we sold our equity interest in a joint venture with NBCUniversal Media, LLC ("NBC"). The joint venture was a limited partner in a business that owns television stations KXAS-TV, an NBC affiliate in Dallas, and KNSD-TV, an NBC affiliate in San Diego. See "Joint Venture Sale Transaction."

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(2)
DMA estimates and rankings are taken from Nielsen Local Universe Estimates for the 2012-2013 Broadcast Season, effective September 22, 2012. There are 210 DMAs in the United States. All Nielsen data included in this report represents Nielsen's estimates, and Nielsen has neither reviewed nor approved the data included in this report.

(3)
We own and operate all of our stations and digital channels except for those (i) noted as "LMA" which indicates stations to which we provide services under a local marketing agreement (see "Distribution of Programming—Full-power television stations" for a description of these agreements), (ii) noted as "SSA" which indicates stations to which we provide technical, engineering, promotional, administrative and other operational support services under a shared services agreement (see "Distribution of Programming—Full-power television stations" for a description of these agreements), and (iii) noted as "JSA" which indicates stations to which we provide advertising sales services under a joint sales agreement (see "Principal Sources of Revenue—Other revenues" for a description of these agreements).

(4)
WISH-TV includes a low-power station, WIIH-CD. WOOD-TV, WAVY-TV, KNVA-TV, KRQE-TV, KASA-TV, KOIN-TV, KSNT-TV, WLUK-TV and WWLP-TV each includes a group of low-power stations. KRQE-TV includes two satellite stations, KBIM-TV and KREZ-TV. KWBQ-TV includes one satellite station KRWB-TV. KHON-TV includes two satellite stations, KHAW-TV and KAII-TV. KSNW-TV includes KSNC(TV), KSNG(TV) and KSNK(TV) as satellite stations and KSNL-LD as a translator. We own, operate or service all of these satellite stations and low-power stations, which broadcast either identical programming as the primary station or programming specific to such channel.

(5)
KBVO-TV is a full power satellite station of KXAN-TV and its primary affiliate is MyNetworkTV.

(6)
License renewal applications have been filed with the FCC and are currently pending. For further information on license renewals, see "Federal Regulation of Television Broadcasting—License Renewals".

Joint Venture Sale Transaction

        On February 12, 2013, we announced that we entered into, and simultaneously closed the transactions contemplated by a Transaction Agreement (the "Transaction Agreement"), by and among LIN TV, LIN Television, LIN Television of Texas, L.P., a Delaware limited partnership and indirect wholly owned subsidiary of ours ("LIN Texas" and together with LIN TV and LIN Television, the "LIN Parties"), NBC Telemundo License LLC, a Delaware limited liability company ("NBC"), NBCU New LLC I, a Delaware limited liability company, NBCU New LLC II, a Delaware limited liability company, General Electric Company, a New York corporation ("GE"), General Electric Capital Corporation, a Delaware corporation ("GECC" and together with GE, the "GE Parties"), National Broadcasting Company Holding, Inc., a Delaware corporation, Comcast Corporation, a Pennsylvania corporation ("Comcast"), NBCUniversal Media, LLC, a Delaware limited liability company ("NBCUniversal"), Lone Star SPV, LLC, a Delaware limited liability company and Station Venture Holdings, LLC, a Delaware limited liability company ("SVH"). The Transaction Agreement effected a series of transactions related to the ownership and sale of LIN Texas's 20.38% equity interest in SVH, a joint venture in which NBC, an affiliate of NBCUniversal, held the remaining 79.62% equity interest (collectively, the "JV Sale Transaction").

        SVH is a limited partner in a business that operates an NBC affiliate in Dallas and an NBC affiliate in San Diego pursuant to a management agreement. At the time of LIN Texas's acquisition of its interest in SVH in 1998, GECC provided secured debt financing to SVH in the form of a $815.5 million non-amortizing senior secured note due 2023 to GECC (the "GECC Note"), and, in connection with SVH's assumption of the GECC Note, LIN TV guaranteed the payment of the full amount of principal and interest on the GECC Note (the "GECC Guarantee").

        In addition, during 2009, 2010, 2011 and 2012, LIN Television entered into agreements with SVH, the GE Parties and NBCUniversal pursuant to which LIN Television, the GE Parties and NBCUniversal caused to be provided to SVH certain unsecured shortfall funding loans (the "Shortfall Funding Loans") on the basis of each party's percentage of equity interest in SVH in order to fund interest payments on the GECC Note.

        Pursuant to the JV Sale Transaction, in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations related to any shortfall funding agreements. Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal, and the LIN Parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00.

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        As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee. Although the JV Sale Transaction was completed on February 12, 2013, we accrued for and expensed the $100 million capital contribution to SVH and recorded the related tax effects of the JV Sale Transaction, which includes the recognition of a short-term deferred tax liability of approximately $163 million in our consolidated financial statements as of December 31, 2012. We accrued for the capital contribution as of December 31, 2012, because it was an obligation that was both probable and estimable as of the date of this report.

Merger

        On February 12, 2013, we also announced that we entered into an Agreement and Plan of Merger (the "Merger Agreement") with LIN Media LLC, a newly formed Delaware limited liability company and wholly owned subsidiary of LIN TV ("LIN LLC"). Pursuant to the Merger Agreement, LIN TV will be merged with and into LIN LLC with LIN LLC continuing as the surviving entity (the "Merger"). In the Merger, holders of shares of each class of common stock of LIN TV will receive on a one-for-one basis, common shares representing a corresponding series of limited liability interests in LIN LLC. The Merger is expected to enable the surviving entity to be classified as a partnership for federal income tax purposes and such change in classification would be treated as a liquidation of LIN TV for federal income tax purposes with the result that LIN TV would recognize gain or loss, as applicable, in its 100% equity interest in LIN Television.

        The Merger will be submitted to a vote of the holders of outstanding common stock of LIN TV. Proxies will be solicited by LIN TV's board of directors pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act") in order for LIN TV's stockholders to consider approving the Merger at a special meeting of stockholders and a registration statement will be filed under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the class A common shares representing limited liability company interests in LIN LLC. This Report is not a solicitation of a proxy from any security holder of LIN TV. Holders of LIN TV common stock are urged to read the proxy statement/prospectus, registration statement and any other relevant documents when they become available because they will contain important information about LIN TV, LIN LLC and the Merger, including its terms and anticipated effect and risks to be considered by the Company's stockholders in connection with the Merger. The proxy statement/prospectus and other documents relating to the Merger (when they are available) can be obtained free of charge from the SEC's web site at www.sec.gov. The documents (when they are available) can also be obtained free of charge from LIN TV on its web site (www.linmedia.com) or upon written request to LIN TV Corp., Attention: Secretary, One West Exchange Street, Suite 5A, Providence, Rhode Island 02903. Information on LIN TV's web site does not constitute a part of this Current Report on Form 10-K.

        We expect that LIN LLC's common shares will be listed on the NYSE.

Incremental Facility

        On February 12, 2013, LIN Television and Deutsche Bank Trust Company Americas ("Deutsche Bank"), signed an Incremental Term Loan Activation Notice tranche B-2 Term Facility creating an incremental term loan facility (the "Incremental Facility") pursuant to the LIN Television's existing credit agreement, dated as of October 26, 2011, as amended on December 19, 2011, as further amended on December 24, 2012, by and among LIN Television, JPMorgan Chase Bank, N.A. ("JP Morgan"), as Administrative Agent, and the banks and other financial institutions party thereto (the "Credit Agreement").

        The Incremental Facility is a five-year, $60 million term loan facility and is subject to the terms of the Credit Agreement. The proceeds of the Incremental Facility, as well as cash on hand and cash from

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revolving borrowings under the Credit Agreement, were used to fund the $100 million transferred to SVH by LIN TV pursuant to the JV Sale Transaction as described above.

        For additional information regarding the JV Sale Transaction, the Merger or the Incremental Facility, see Item 1A.—Risk Factors.

Recent Acquisitions and Discontinued Operations

        On October 12, 2012, LIN Television completed its acquisition (the "Acquisition") of television stations in eight markets that were previously owned by affiliates of New Vision Television, LLC ("New Vision") for $334.9 million, subject to certain post-closing adjustments, and including the assumption of $14.3 million of finance lease obligations. As a result of the Acquisition, we now own, operate or service 43 television stations, seven digital channels and a growing portfolio of web sites, applications and mobile products in 23 U.S. markets. Concurrently, on October 12, 2012, Vaughan Acquisition LLC ("Vaughan"), a third-party licensee, completed its acquisition of separately owned television stations in three markets for $4.6 million from PBC Broadcasting, LLC ("PBC"). We provide certain services to the television stations acquired by Vaughan pursuant to shared services arrangements with Vaughan.

        Additionally, on December 10, 2012, LIN Television acquired certain assets of the ACME Television, LLC ("ACME") television stations KWBQ-TV, KRWB-TV and KASY-TV, each of which serves the Albuquerque-Santa Fe, NM market.

        For additional information on the foregoing, see Note 2—"Acquisitions" to our consolidated financial statements.

        On October 21, 2011, we reached an agreement to sell WWHO-TV, in Columbus, OH, and we completed the sale on February 16, 2012 to Manhan Media, Inc. Additionally, on January 3, 2012, we entered into an agreement for the sale of substantially all of the assets of WUPW-TV to WUPW, LLC. This transaction subsequently closed on April 21, 2012. For additional information on these discontinued operations, see Note 3—"Discontinued Operations" to our consolidated financial statements.

Description of Our Business

        We are a local multimedia company that owns, operates or services 43 television stations and seven digital channels in 23 U.S. markets. Our diverse portfolio of web sites, apps and mobile products make it more convenient to access our unique content on multiple screens and our innovative multimedia advertising solutions capture the attention of target audiences and deliver results. Our vision is to be the market-leading local multimedia company and consumers' and advertisers' preferred choice for unique, innovative and relevant content on all screens.

        The principal components of our strategy include:

    Sustain our Local News Leadership.  In 2012, we operated the number one or number two local news station in 87% of our news markets(1), 100% of our measured web sites ranked number one or number two versus our measured local broadcast competitors for unique visitors and page views(2), and we earned several of our industry's top awards. The strength of our local news brands is a result of our ability to embrace changing media habits, focus on superior multiscreen content production and distribution, invest in localism, and commit to training and sharing best practices throughout our organization. For example, the modernization of our newsrooms into multiscreen content centers with trained journalists who have a wide range of skills, including video camera operation

   


(1)
Average of our February, May and November 2012 Nielsen ratings based on Key Demographics. Monday-Friday, Early Morning, Early Evening, Late News. All Nielsen data included in this document represents Nielsen's estimates, and Nielsen has neither reviewed nor approved the data included in this document. Excludes the television stations acquired from affiliates of New Vision on October 12, 2012.
(2)
*comScore media metrics data; December 2012 (3 month average). The basis for comparison is calculated against the Company's and local broadcast competitors' self-defined classification from within the comScore dictionary.

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      and writing and editing from the field, have resulted in more content and better coverage on every screen. In addition, we launched high definition newscasts at 12 stations in 2012. Currently, 38 of our television stations are operating and producing in high definition, which we believe enhances our competitive positions in those markets. Our investments in local news content production and distribution are among the most important elements in building loyalty amongst viewers and attracting local advertising revenue.

    Build Scale, Synergies & Efficiencies.  In October 2012, we closed the largest acquisition in our company's history. The newly acquired or serviced television stations expanded our national footprint with media properties in geographically diverse locations. In addition, they are providing significant opportunities to grow our digital business, increase our bargaining power with MVPDs, networks and syndicators, and add greater scale to amortize digital media and technology investments, including our shared services capabilities. Our two regional technology centers provide engineering, operations, financial and administrative functions for most of our television stations, which has maximized operating synergies throughout our company and reduced capital costs. We also continued to achieve company-wide operating efficiencies through economies of scale in the purchase of programming, ratings services, research services, national sales representation, capital equipment and other vendor services. Also in 2012, we advanced our "Accelerate" sales strategy in order to create cross-selling multiplatform opportunities; enhance the technical capabilities of our sales teams, improve synergies and streamline and standardize all sales support functions and operations to benefit our advertisers.

    Grow and Differentiate Our Digital Media Business.  Since the launch of our digital operations in 2007, we have committed to and invested in continuous multi-screen product innovation and advertising solutions that reach target audiences and generate results. In 2012, we launched "Project NewsTouch", a single solution and uniform workflow process that delivers the best app and mobile web experience to mobile devices. As a result of our efforts, we increased mobile views by 68%, compared to 2011(3). Another important component of our strategy is to invest in companies that are at the forefront of the changing media landscape and can deliver synergies. For example, LIN Digital provides digital marketing strategies and solutions to some of the nation's most respected agencies and brands. In 2012, LIN Digital opened its sales headquarters in New York City and now has sales representation in 28 U.S. cities, including Chicago and Los Angeles. In addition, Nami Media, an online marketing and technology company that specializes in the rapidly growing area of performance marketing, broadened its product development capabilities and expanded its Los Angeles operations. We also made an important investment in the mobile space in November 2012 with the launch of LIN Mobile. Leveraging our company's 50-year history and strong relationships with local and national advertisers, LIN Mobile was founded to help clients effectively market their products and services to an increasingly mobile-centric population by delivering targeted and localized media across all dominant mobile devices. Finally, our 2012 acquisition of television stations from New Vision provides us with an opportunity to expand our digital business both locally and nationally. As a result of our strategy, interactive revenues have increased from 1% of total revenues in 2007 to 7% of total revenues in 2012(4), providing greater revenue diversity.

    Secure Subscriber Fees from Pay-Television Operators.  According to Nielsen, cable, satellite television and telecommunications companies currently provide video program services to approximately 90% of total U.S. television households(5). The surge of competition from satellite and telecommunications companies, combined with our strong local and national programming, provides us with compelling negotiating positions to obtain compensation for our channels. It is of

   


(3)
Adobe SiteCatalyst & StepLeader, mobile page views from newsTouch, (1/1/12-12/31/12) compared to Adobe SiteCatalyst & StepLeader reporting, mobile page views, (1/1/11-12/31/11).
(4)
Interactive revenues include revenues generated from our TV station web sites in 2007 and revenues generated from our TV station web sites, LIN Digital and Nami Media in 2012.
(5)
Nielsen DMA Media Related TV Households: February 2013. All Nielsen data included in this report represents Nielsen's estimates, and Nielsen has neither reviewed nor approved the data included in this report.

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      critical importance to the broadcast industry that pay-television operators pay subscriber fees that are commensurate with the superior ratings our channels achieve relative to cable channels. We have successfully negotiated and will continue to negotiate with pay-television operators in our local markets to ensure we receive our fair share of subscription fees.

    Continue to Explore New Uses for our Spectrum.  We believe our spectrum has value beyond traditional television channels, and digital technology enables us to separate a portion of that spectrum for incremental services. We currently own or service seven digital sub-channels, all affiliated with a national television network that utilize spectrum shared with other network affiliates. Our multi-channel strategy helps us appeal to a wider audience and market of advertisers while providing economies of scale to provide these additional programming services at a low incremental cost. In addition, our President and Chief Executive Officer was President of the Open Mobile Video Coalition in 2012, an organization focused on developing technology to provide live, local and national over-the-air digital television to consumers via next-generation portable and mobile devices. During the year, KXAN-TV, our NBC affiliate in Austin, participated in the launch of Dyle Mobile TV, which brings live broadcast television, including local and national news, sports and entertainment programming to mobile devices at home or on-the-go.

    Grow Our Revenue Share Through a Focus on Local Programming.  We are committed to improving the quality of our existing programs, developing new local programs, and generating new sources of revenue. Local programming allows us to leverage our existing production teams and on-air talent while limiting our exposure to long-term syndicated programming contracts. It also allows us to offer unique local marketing solutions beyond :30 and :60 second spots to local advertisers. In addition, local programming provides differentiated proprietary content for our local web sites and mobile products. In 2012, we launched our 12th local lifestyle program, "Living Dayton", and aired more than 32,000 local programming hours(6). In addition, during the 2012 presidential election year, we maximized every opportunity to educate viewers and provide a unique platform for candidates to reach voters. We believe that our commitment to localism continues to build brand loyalty and differentiate us from our competition.

    Provide Superior Community Service.  Our model of community service exemplifies broadcasting's great value and responsibility to the local community. We believe it is critically important to ensure the dynamic future of our industry, which is why we have been awarding two-year scholarships to ambitious students interested in a wide spectrum of fields in or relating to broadcast television since 1998, and digital media since 2011. In addition, we provide programming that is responsive to community needs, such as, emergency alerts, closed captioning for hearing impaired viewers, and children's programming. We also support numerous non-profit organizations, programs and events that help make the communities we serve better, stronger, and more vibrant places to live, work, and do business.

Principal Sources of Revenue

Local, national and political advertising revenues

        We generate local, national and political advertising revenues principally from advertising time sold in our local news, network and syndicated programming. In general, advertising rates are based upon a variety of factors, including:

    size and demographic makeup of the market served by the television station;

    a program's popularity among television viewers;

    number of advertisers competing for the available time;

    availability of alternative advertising media in the station's market area;

   


(6)
Excludes programming aired by our newly acquired television stations.

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    our station's overall ability to attract viewers in its market area;

    our station's ability to attract viewers among particular demographic groups that an advertiser may be targeting; and

    effectiveness of our advertising sales force.

Retransmission consent fees

        We have retransmission consent agreements with cable, satellite and telecommunications providers from which we earn retransmission consent fees for the right to carry our signals in their pay-television services to consumers.

Television station web site revenues

        We generate revenues through advertisements on our television stations' web sites and mobile applications.

Interactive revenues

        We generate interactive revenues primarily by providing online advertising and media services through our online advertising and media services business, LIN Digital (formerly RMM), and Nami Media, our digital advertising management and technology company.

Other revenues

        Other revenues include barter of unsold advertising inventory for goods and services that are required to operate our television stations or are used in sales and marketing efforts. We also acquire certain syndicated programming by providing a portion of the available advertising inventory within the program, in lieu of cash payments.

        Additionally, we receive other revenues from sources such as renting space on our television towers, renting our production facilities, copyright royalties and providing television production services. Finally, we earn fee income through shared services agreements for two stations located in the Albuquerque-Santa Fe market, under which we provide technical, engineering, promotional, administrative and other operational support services from our stations that we own and operate within the market. We also have shared services agreements and joint sales agreements for stations in the Dayton, Ohio, Savannah, Georgia, Topeka, Kansas and Youngstown, Ohio markets, pursuant to which we also provide advertising sales services.

Sources and Availability of Programming

        We program our television stations from the following program sources:

    News and general entertainment programming that is produced by our local television stations;

    Network programming such as "CSI" or "Modern Family";

    Syndicated programming: off-network programs, such as "Criminal Minds" or "How I Met Your Mother" and first-run programs, such as "Jeopardy", "Entertainment Tonight" or "Wheel of Fortune";

    Paid programming: arrangements where a third party pays our stations for a block of time, generally in one-half hour or one hour time periods to air long-form advertising or "infomercials";

    Digital subchannel content affiliations or agreements such as "Bounce TV", "Antenna TV" and "CoolTV"; and

    Local Weather Station: we provide a 24-hour weather channel to local cable systems in certain of our television markets.

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Locally produced news and general entertainment programming

        Our television stations and digital channels produce an aggregate of approximately 856 hours of local news programming per week that we broadcast on all but eight of our stations. Local news programming also allows us greater control over our programming costs.

        The number of weekly hours of network, local news and other local programming produced by our television stations and digital channels are as follows:

Network
  DMA   DMA
Rank
  Station   Weekly Hours
of Network
Programming
  Weekly Hours
of Local News
Programming
  Weekly Hours
of Other Local
Programming
  Network
Affiliation
End Date
 

ABC

 

Hartford-New Haven, CT

    30   WTNH-TV     86     29     3     8/31/2017  

 

Grand Rapids-Kalamazoo-Battle Creek, MI

    39   WOTV-TV     86     9     1     8/31/2017  

 

Savannah, GA

    92   WJCL-TV     77     17     1     4/1/2013  

 

Youngstown, OH

    110   WYTV-DT     77     20     1     9/30/2017  

 

Topeka, KS

    136   KTKA-TV     77     19     1     12/31/2015  

CBS

 

Portland, OR

    22   KOIN-TV     100     30     1     9/18/2016  

 

Indianapolis, IN

    26   WISH-TV     94     35     7     12/31/2014  

 

Birmingham, AL

    42   WIAT-TV     99     28     1     12/31/2014  

 

Albuquerque, NM

    47   KRQE-TV     100     33     1     12/31/2014  

 

Buffalo, NY

    52   WIVB-TV     92     30     6     12/31/2014  

 

Providence, RI-New Bedford, MA

    53   WPRI-TV     97     33     1     12/31/2014  

 

Fort Wayne, IN

    109   WANE-TV     100     25     1     12/31/2014  

 

Youngstown, OH

    110   WKBN-TV     94     23     1     1/31/2017  

 

Mason City, IA

    153   KIMT-TV     98     20     1     6/30/2015  

 

Terre Haute, IN

    154   WTHI-TV     94     25     1     12/31/2014  

 

Lafayette, IN

    189   WLFI-TV     94     23     1     12/31/2017  

NBC

 

Grand Rapids-Kalamazoo-Battle Creek, MI

    39   WOOD-TV     98     32     7     1/1/2017  

 

Norfolk-Portsmouth-Newport News, VA

    44   WAVY-TV     96     35     6     1/1/2017  

 

Austin, TX

    45   KXAN-TV     95     31     1     1/1/2017  

 

Dayton, OH

    63   WDTN-TV     95     25     5     1/1/2017  

 

Wichita, KS

    66   KSNW-TV     95     27     1     1/1/2017  

 

Springfield-Holyoke, MA

    114   WWLP-TV     96     34     6     1/1/2017  

 

Topeka, KS

    136   KSNT-TV     95     24         1/1/2017  

FOX

 

Norfolk-Portsmouth-Newport News, VA

    44   WVBT-TV     26     5     3     12/31/2017  

 

Albuquerque, NM

    47   KASA-TV     26     14     5     12/31/2017  

 

Providence, RI-New Bedford, MA

    53   WNAC-TV     26     16     1     12/31/2017  

 

Mobile, AL/Pensacola, FL

    60   WALA-TV     26     34     5     12/31/2017  

 

Green Bay-Appleton, WI

    69   WLUK-TV     26     43     7     12/31/2017  

 

Honolulu, HI

    71   KHON-TV     26     33         12/31/2017  

 

Savannah, GA

    92   WTGS-TV     26     7         12/31/2017  

 

Youngstown, OH

    110   WYFX-LD     26     16         12/31/2017  

 

Topeka, KS

    136   KTMJ-CD     26     13         12/31/2017  

 

Terre Haute, IN

    154   WTHI-TV-D2     26     4         12/31/2017  

CW

 

Austin, TX

    45   KNVA-TV     20     4         9/17/2016  

 

Albuquerque, NM

    47   KWBQ-TV     20             9/17/2016  

 

Buffalo, NY

    52   WNLO-TV     36     9     5     9/17/2016  

 

Mobile, AL/Pensacola, FL

    60   WFNA-TV     20         5     9/17/2016  

 

Dayton, OH

    63   WBDT-TV     20     4         9/17/2016  

 

Green Bay-Appleton, WI

    69   WCWF-TV     20         1     9/17/2016  

 

Honolulu, HI

    71   KHON-TV-D2     20             9/17/2020  

 

Topeka, KS

    136   KTKA-TV-D2     20             9/17/2019  

MyNetworkTV

 

Indianapolis, IN

    26   WNDY-TV     13     15     1     9/28/2014  

 

Hartford-New Haven, CT

    30   WCTX-TV     10     9     1     9/28/2014  

 

Grand Rapids-Kalamazoo-Battle Creek, MI

    39   WXSP-CD     10     4         9/28/2014  

 

Austin, TX

    45   KBVO-TV     10     3     1     9/28/2014  

 

Albuquerque, NM

    47   KASY-TV     10         1     9/28/2014  

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Network
  DMA   DMA
Rank
  Station   Weekly Hours
of Network
Programming
  Weekly Hours
of Local News
Programming
  Weekly Hours
of Other Local
Programming
  Network
Affiliation
End Date
 

 

Providence, RI-New Bedford, MA

    53   WNAC-TV-D2     10         1     9/28/2014  

 

Youngstown, OH

    110   WYTV-DT-D2     10     10     1     9/28/2014  

 

Mason City, IA

    153   KIMT-TV-D2     10     6         9/28/2014  

Telemundo

 

Wichita, KS

    66   KSNG-TV-D2     26             12/31/2014  
                                   

                  2,680     856     93        
                                   

Network programming

        All of our stations are affiliated with one of the national television networks. Our network affiliation agreements provide a local station certain exclusive rights and an obligation, subject to certain limited preemption rights, to carry the network programming. While the networks retain most of the advertising time within their programs for their own use, the local station also has the right to sell a limited amount of advertising time within the network programs. Other time periods, which are not programmed by the networks, are programmed by the local station, for which the local station retains substantially all of the advertising revenues. Networks also share certain of their programming with cable networks and make certain of their programming available through their web site or on web sites such as hulu.com. These outlets compete with us for viewers in the communities served by our stations.

        The programming strength of a particular national television network may affect a local station's competitive position. Our stations, however, are diversified among the various networks, reducing the potential impact of any one network's performance. We believe that national television network affiliations remain an efficient means of obtaining competitive programming, both for established stations with strong local news franchises and for newer stations with greater programming needs.

        Our stations that are affiliated with ABC, CBS, FOX and NBC generate a higher percentage of revenue from the sale of advertising within network programming than stations affiliated with CW and MyNetwork. Our affiliation agreements have terms with scheduled expiration dates ranging through September 17, 2020. These agreements are subject to earlier termination by the networks under specified circumstances, including a change of control of our Company, which would generally result from the acquisition of shares having 50% or more of the voting power of our Company.

Syndicated programming

        We acquire the rights to programs for time periods in which we do not air our local news or network programs. These programs generally include first-run syndicated programs, such as "Jeopardy", "Entertainment Tonight" or "Wheel of Fortune", or reruns of current or former network programs, such as "Criminal Minds" or "How I Met Your Mother". We pay cash for these programs or exchange advertising time within the program for the cost of the program rights. We compete with other local television stations to acquire these programs. In addition, a television viewer can now choose to watch many of these programs on national cable networks or purchase these programs on DVDs or via downloads to computers, mobile video devices or web-based video players, which increases fragmentation of our local television audience.

Distribution of Programming

        The programming that airs on our television stations can reach the television audience by one or more of the following distribution systems:

    Full-power television stations, including stations we operate or service under local marketing agreements ("LMAs"), joint sales agreements ("JSAs"), shared services arrangements ("SSAs") or similar arrangements;

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    Cable television systems;

    Satellite television systems;

    Telecommunications systems;

    Internet, mobile and other digital services;

    Low-power television stations; and

    Digital channels.

Full-power television stations

        We own, operate or service 40 full-power television stations that operate on over-the-air channels 7 through 49. Our full-power television stations include two full-power stations for which we provide programming, sales and other related services under grandfathered LMAs, six full-power stations and two digital channels for which we provide technical, engineering, promotional, administrative and other operational support services under SSAs (for four of these stations and the two digital channels we also provide advertising sales services under a JSA). See "Our television stations" for a listing of our full-power television stations.

        The FCC television licenses for the two full-power television stations for which we provide programming, sales and other related services under LMAs are not owned by us. Revenues generated by these stations contributed 4% to our net revenues for the years ended December 31, 2012, 2011 and 2010, respectively. We incur programming costs, operating costs and capital expenditures related to the operation of these stations, and retain all advertising revenues. In Providence and Austin, the two local markets where these stations are located, we own and operate at least one station. These LMA stations are an important part of our multi-channel strategy. We have purchase options to acquire the FCC licenses for the LMA stations in Providence and Austin, which are exercisable if the legal requirements limiting ownership of these stations change.

        The FCC television licenses for the six full-power television stations for which we provide technical, engineering, promotional, administrative and other operational support services under SSAs and other arrangements are also not owned by us. Revenues generated by these stations contributed 2% to our net revenues for the year ended December 31, 2012. In each of the five markets where these stations are located, we own and operate at least one station. These SSA stations are also an important part of our multi-channel strategy. We have purchase options to acquire the FCC licenses for the SSA stations in Albuquerque, Dayton, Savannah, Youngstown, and Topeka, which are exercisable if the legal requirements limiting ownership of these stations change.

Cable, satellite television and telecommunications systems

        According to Nielsen, cable, satellite television and telecommunications companies currently provide video program services to approximately 90% of total U.S. television households, with cable and telecommunications companies serving 60% of U.S. households and direct broadcast satellite ("DBS") providers serving 30%. As a result, cable, satellite television and telecommunications companies are not only primary competitors, but the primary means by which our television audience views our television stations. Most of our stations are distributed pursuant to retransmission consent agreements with multichannel video program distributors ("MVPDs") that operate in markets we serve. As of December 31, 2012, we had retransmission consent agreements with 163 distributors, including 159 Multiple System Operators ("MSOs") and regional telecommunications companies, the two major satellite television providers, and two national telecommunications providers. For an overview of FCC regulations governing carriage of television broadcast signals by MVPDs, see "Federal Regulation of Television Broadcasting—Cable and Satellite Carriage of Local Television Signals."

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Internet, mobile and other digital services

        We operate television station web sites in 23 U.S. markets and offer a growing portfolio of Internet-based products and services that provide traditional and new audiences around-the-clock access to our trusted local news and information. We launched our mobile business in 2009 with iPhone and BlackBerry smartphone applications and we have since launched Android and iPad applications. In addition, we launched SMS/text messaging, video blogging and other advanced interactive features that further extend the distribution of our content.

Low-power television stations

        We own and operate a number of low-power television stations. We operate these stations either as a stand-alone or satellite stations. These low-power broadcast television stations are licensed by the FCC to provide service to substantially smaller areas than those of full-power stations.

        In ten of our markets, Albuquerque, Austin, Grand Rapids, Green Bay, Indianapolis, Springfield, Norfolk-Portsmouth-Newport News, Portland, Wichita, and Topeka, we use our low power stations to extend the geographic reach of our primary stations in these markets. In Grand Rapids, we affiliated WXSP-CD, a group of low-power television stations, with MyNetworkTV, to cover substantially all of the local market. In Topeka and Youngstown, we have also affiliated the low power stations, KTMJ-CD and WYFX-LD with the FOX network.

Seasonality of Our Business

        Our advertising revenues are generally highest in the second and fourth quarters of each calendar year, due to higher advertising in the spring season and in the period leading up to and including the end-of-year holiday season. Our operating results are also significantly affected by annual cycles, as advertising revenues are generally higher in even-numbered years due to additional revenues associated with political advertising related to local and national elections, and incremental advertising revenues associated with Olympic broadcasts.

        Our industry is cyclical in nature and affected by prevailing economic conditions. Since we rely on sales of advertising for a substantial majority of our revenues, our operating results are sensitive to general economic and regional conditions in each local market where we operate.

Competitive Conditions in the Television Industry

        The television broadcast industry has become highly competitive as a result of new technologies and new program distribution systems. In most of our local markets, we compete directly against other local broadcast stations and cable networks carried on cable, satellite television and telecommunication systems for audience. We also compete with online video services, including local news web sites and web sites such as hulu.com, which provide access to some of the same programming, including network programming that we provide, and other emerging technologies. Many of our current and potential competitors have greater financing, marketing, programming, and broadcasting resources than we do. Technological innovation and the resulting proliferation of television entertainment alternatives, such as cable, satellite television and telecommunications video services, Internet, wireless, pay-per-view and video-on-demand, digital video recorders, DVDs and mobile video devices have fragmented television viewing audiences and have subjected free over-the-air television broadcast stations to new types of competition. As a result, we are experiencing increased competition for viewing audience and advertisers.

Federal Regulation of Television Broadcasting

        Overview of Regulatory Issues.    Our television operations are subject to the jurisdiction of the FCC under the Communications Act of 1934, as amended (the "Communications Act"). The Communications

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Act prohibits the operation of broadcast stations except pursuant to licenses issued by the FCC and empowers the FCC, among other things, to issue, renew, revoke and modify broadcasting licenses; assign frequency bands; determine stations' frequencies, locations and power; regulate the equipment used by stations; and to impose penalties—including monetary forfeitures, short-term renewal of licenses and, in especially egregious cases, license revocation or denial of license renewals—for violations of its regulations.

        The Communications Act prohibits the assignment of a broadcast license or the transfer of control of a licensee without the FCC's prior approval. The FCC also regulates certain aspects of the operation of cable television systems, DBS systems and other electronic media that compete with broadcast stations. In addition, the FCC regulates matters such as television station ownership, affiliate relations with the networks, cable and DBS systems' carriage of television station signals, carriage of syndicated and network programming on distant stations, political advertising practices, children's programming and obscene and indecent programming.

        Spectrum Allocation.    Pursuant to the Communications Act, the FCC bears responsibility for the allocation and licensing of all non-federal government spectrum. Subject to certain procedural, congressional, and judicial constraints, the FCC has the ability to reallocate entire spectrum bands to a new use or to modify individual licenses to a new use. An FCC license holder is entitled to a bundle of rights related to that license; however ownership of the underlying spectrum is retained by the federal government. As a part of its National Broadband Plan, the FCC requested additional authority from Congress to hold incentive spectrum auctions, whereby current users of particular bands or licenses would receive compensation for voluntarily relinquishing some or all rights to spectrum they are licensed to use. On February 17, 2012, Congress approved legislation authorizing the FCC to conduct incentive spectrum auctions. The legislation, which the President subsequently signed into law, includes safeguards for broadcasters. In particular, the legislation requires the FCC to make all reasonable efforts to ensure that stations retain their existing coverage areas, prevents the FCC from forcing a broadcaster to move from a UHF to a VHF channel, and establishes a fund to reimburse broadcasters for reasonable relocation expenses relating to the spectrum repacking. It is expected that the incentive auction process will require several rule making proceedings, which may span several years. On October 2, 2012, the FCC released a Notice of Proposed Rule Making to implement the incentive auction statute. That proceeding remains pending. We cannot predict the timing or scope of the incentive spectrum auctions, nor the impact, if any, that the reallocation of spectrum will have on our business.

        License Renewals.    Under the Communications Act, the FCC generally may grant and renew broadcast licenses for terms of eight years, although licenses may be renewed for a shorter period under certain circumstances. The Communications Act requires the FCC to renew a broadcast license if the FCC finds that (i) the station has served the public interest, convenience and necessity; (ii) there have been no serious violations of either the Communications Act or the FCC's rules and regulations by the licensee; and (iii) there have been no other serious violations that taken together constitute a pattern of abuse. In making its determination, the FCC may consider petitions to deny but cannot consider whether the public interest would be better served by issuing the license to a person other than the renewal applicant. We are in good standing with respect to each of our FCC licenses. The table on pages 6 and 7 includes the expiration date of the primary broadcasting licenses for the stations that we own, as well as for the stations to which we provide services. As indicated in the table, the licenses for these stations have expiration dates ranging between 2007 and 2015. License renewal applications were timely filed for each of the stations for which the license is now expired. Once an application for renewal is filed, each station remains licensed while its application is pending, even after its license expiration date has passed. The license for WNAC has a long-standing application for renewal that remains pending with the FCC. Action on many license renewal applications may have been delayed for reasons, such as, the pendency of complaints that programming provided by the various networks contained indecent material and complaints regarding alleged violations of sponsorship identification rules. We cannot predict when the FCC will act on pending

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renewal applications. We expect the FCC to renew each of these licenses but we make no assurance that it will do so.

        Ownership Regulation.    The Communications Act and FCC rules limit the ability of individuals and entities to have ownership or other attributable interests in certain combinations of broadcast stations and other media. The Communications Act also requires the FCC to review its broadcast ownership rules every four years to determine whether they remain necessary in the public interest. In 1999, the FCC modified its local television ownership rules. In 2003, the FCC issued an order that would have liberalized most of the ownership rules, permitting us to acquire television stations in certain markets where we are currently prohibited from acquiring additional stations. In 2004, the Third Circuit Court of Appeals stayed and remanded several of the FCC's 2003 ownership rule changes. In July 2006, as part of the FCC's statutorily required quadrennial review of its media ownership rules, the FCC sought comment on how to address the issues raised by the Third Circuit Court of Appeals' decision. In February 2008, the FCC released an order that re-adopted its 1999 local television ownership rules, and those rules are currently in effect. Several parties appealed the FCC's February 2008 decision, and in July 2011, the United States Court of Appeals for the Third Circuit mostly denied those petitions. On December 22, 2011, the FCC issued its Notice of Proposed Rulemaking ("NPRM") as part of its 2010 Quadrennial Review of the media ownership rules. The NPRM indicates that the FCC intends to maintain the current local television ownership rules with only minor modifications. Despite the preliminary conclusions in the NPRM, we cannot predict whether the pending quadrennial review proceeding may ultimately result in changes to the FCC's broadcast ownership rules. The FCC's current ownership rules that are material to our operations are summarized below.

        Local Television Ownership.    Under the FCC's current local television ownership (or "duopoly") rule, a party may own multiple television stations without regard to signal contour overlap provided they are located in separate Nielsen DMAs. In addition, the rules permit parties to own up to two TV stations in the same DMA so long as (i) at least one of the two stations is not among the top four-ranked stations in the market based on audience share at the time an application for approval of the acquisition is filed with the FCC, and (ii) at least eight independently owned and operating full-power commercial and non-commercial television stations would remain in the market after the acquisition. In addition, without regard to the number of remaining or independently owned television stations, the FCC currently permits television duopolies within the same DMA so long as the commonly owned stations' signal contours do not overlap, although the FCC proposed to remove this exception in the NPRM. Stations designated by the FCC as "satellite" stations are exempt from the local television ownership rule. Also, the FCC may grant a waiver of the local television ownership rule if one of the two television stations is a "failed" or "failing" station or if the proposed transaction would result in the construction of a new television station (an unbuilt-station waiver). We believe that we are currently in compliance with the local television ownership rule.

        The FCC's 1999 ownership order established a rule attributing LMAs for ownership purposes. The FCC grandfathered LMAs that were entered into prior to November 5, 1996, permitting those stations to continue operations pursuant to such LMAs. The FCC, which retains the authority to review the status of grandfathered LMAs, stated it would conduct a case-by-case review of grandfathered LMAs and assess the appropriateness of extending the grandfathering periods. We do not know when, or if, the FCC will conduct any such review of grandfathered LMAs. Grandfathered LMA's can be freely transferred during the grandfather period, but duopolies may be transferred only where the two-station combination continues to qualify under the duopoly rule. We currently have grandfathered LMAs under which we provide programming to stations in Providence, Rhode Island and Austin, Texas.

        From 2010 through 2012, we entered into SSAs and certain other arrangements for stations in Dayton, Ohio, Albuquerque, New Mexico, Savannah, Georgia, Topeka, Kansas, and Youngstown, Ohio. SSAs are currently permitted under the FCC's local television ownership rule and allow for technical, engineering, promotional, administrative and other operational support services. SSAs are different from LMAs in

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various respects, for example, only a limited amount of programming is permitted under an SSA. JSAs further permit us to sell advertising time on these stations. The FCC included in the NPRM a review of SSAs, JSAs and similar arrangements and seeks comment whether they should be attributable for purposes of the media ownership rules. If the FCC decides these arrangements are attributable, we may be required to restructure operations in these markets. We cannot predict whether the pending quadrennial review proceeding may ultimately result in changes to the FCC's rules regarding SSAs or JSAs.

        National Television Ownership Cap.    The Communications Act, as amended in 2004, limits the number of television stations one entity may own nationally. Under the rule, no entity may have an attributable interest in television stations that reach, in the aggregate, more than 39% of all U.S. television households. The FCC currently discounts the audience reach of a UHF station by 50% when computing the national television ownership cap. Our stations reach is approximately 10.5% of U.S. households.

        Attribution of Ownership.    Under the FCC's attribution policies, the following relationships and interests generally are attributable for purposes of the FCC's broadcast ownership restrictions:

    holders of 5% or more of the licensee's voting stock, unless the holder is a qualified passive investor, in which case the threshold is a 20% or greater voting stock interest;

    all officers and directors of a licensee and its direct or indirect parent(s);

    any equity interest in a limited partnership or limited liability company, unless properly "insulated" from management activities; and

    equity and/or debt interests which in the aggregate exceed 33% of a licensee's total assets, if the interest holder supplies more than 15% of the station's total weekly programming, or is a same-market broadcast company, cable operator or newspaper (the "equity/debt plus" standard).

        Under the single majority shareholder exception to the FCC's attribution policies, otherwise attributable interests under 50% are not attributable if a corporate licensee is controlled by a single majority shareholder and the minority interest holder is not otherwise attributable under the "equity/debt plus" standard.

        Because of these multiple ownership and cross-ownership rules, any person or entity that acquires an attributable interest in us may violate the FCC's rules if that purchaser also has an attributable interest in other television or radio stations, or in daily newspapers, depending on the number and location of those radio or television stations or daily newspapers. Such person or entity also may be restricted in the companies in which it may invest to the extent that those investments give rise to an attributable interest. If the holder of an attributable interest violates any of these ownership rules or if a proposed acquisition by us would cause such a violation, we may be unable to obtain from the FCC one or more authorizations needed to conduct our television station business and may be unable to obtain the FCC's consents for certain future acquisitions.

        Digital Television.    We terminated all analog broadcasts on our full power stations on or before June 12, 2009 in connection with the national transition to digital television. Following the transition, each of our full power stations broadcasts a 19.4 megabit-per-second (Mbps) data stream, rather than a single analog program stream. FCC regulations permit substantial flexibility in how we use that data stream. For example, we are permitted to provide a mix of high definition and standard television program streams free-to-air, additional program-related data, subscription video or audio streams, and non-broadcast services. A new technical standard permits digital stations to provide video and data streams that can be more readily received on mobile devices (such as computers and smartphones), if those devices incorporate the technology. These digital channels remain subject to specific FCC regulations. For example, we are required to carry additional children's educational programming if we transmit multiple program streams, and we must pay the U.S. Treasury 5% of gross revenues for any non-broadcast services we provide using our digital signals. The FCC is evaluating whether to impose further public interest

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programming requirements on digital channels. The FCC's digital transition implementation plan maintained the secondary status of low-power television ("LPTV") stations but did not set a deadline for such stations to convert to digital operations. In July 2011, the FCC set a firm deadline, and by September 1, 2015 LPTV stations must cease analog broadcasts and convert to digital operations.

        Cable and Satellite Carriage of Local Television Signals.    Pursuant to FCC rules, full power television stations can obtain carriage of their signals by multi-channel video program distributors in one of two ways: via mandatory carriage or via "retransmission consent." Once every three years each station must formally elect either mandatory carriage ("must-carry") or retransmission consent. The current elections were effective January 1, 2012 and extend through December 31, 2014. A mandatory carriage election invokes FCC rules that require the distributor to carry a single program stream designated by the station and that program stream's related data in the station's local market. Distributors may decline carriage for certain reasons specified in the rules, including a lack of channel capacity, the station's failure to deliver a good quality signal, the presence of a nearby affiliate of the same network or, in the case of satellite distributors, if the distributor does not carry any other local broadcast station in the electing station's market. Distributors do not pay a fee to stations that elect mandatory carriage.

        A station that elects retransmission consent waives its mandatory carriage rights, and the station and the distributor must negotiate in good faith for carriage of the station's signal. Negotiated terms may include channel position, service tier carriage, carriage of multiple program streams, compensation and other consideration. If a station elects to negotiate retransmission terms, it is possible that the station and the distributor will not reach agreement and that the distributor will not carry the station's signal.

        FCC rules govern which local television signals a satellite subscriber may receive. Congress has also imposed certain requirements relating to satellite distribution of local television signals to "unserved" households that do not receive a useable signal from a local station or that reside in a market without a local affiliate of the pertinent network. The Satellite Television Extension and Localism Act of 2010 ("STELA") updated the blanket license scheme previously enacted under the Satellite Home Viewer Extension and Reauthorization Act of 2004 ("SHVERA") by, among other things, extending for five years, until December 31, 2014, statutory licenses that allow satellite television companies to retransmit broadcast signals from distant markets to eligible customers. A satellite provider also is permitted to import the signal of an out-of-market station, with that station's consent, to the specific counties and communities within a local market in which the out-of-market station is deemed to be "significantly viewed," subject to certain conditions. Such carriage previously was governed by the distant signal provisions. Under STELA, it is now treated as a retransmission into the station's local market, which means that the statutory copyright for such carriage will not sunset at the end of 2014. STELA also eliminated the requirement that DBS operators carry the local affiliate of a particular network before they could import an out-of-market station deemed to be significantly viewed in a given county or community. At this time, we are monitoring developments in this area but cannot determine whether this new legislation will result in significant changes to the satellite distribution scheme or whether or how any of the other changes in STELA will impact our broadcast business.

        Several cable system and DBS operators have jointly petitioned the FCC to initiate a rulemaking proceeding to consider amending its retransmission consent rules. The FCC solicited public comment on the petition and subsequently released a notice of proposed rule making in 2011 seeking public comment on whether it should amend its rules to (i) modify its standards for "good faith" negotiations of retransmission consent agreements, (ii) enhance consumer notice obligations; and (iii) eliminate the FCC's network non-duplication and syndicated exclusivity rules. The proceeding is currently pending, and we cannot predict its outcome.

        Programming and Station Operations.    The Communications Act requires broadcasters to serve the public interest. Broadcast station licensees are required to present programming that is responsive to community problems, needs and interests and to maintain records demonstrating such responsiveness.

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Stations must follow various rules that regulate, among other things, children's television programming and advertising, political advertising, sponsorship identification, closed captioning, and contest and lottery advertising. The FCC has also adopted requirements to require stations affiliated with certain networks and serving the nation's largest television markets to provide aural descriptions of video content for the benefit of visually impaired viewers. The FCC has proposed to re-establish a number of formalized procedures that it believes will improve television broadcasters' service to their local communities. These proposals include the establishment of community advisory boards, quantitative programming guidelines and maintenance of a main studio in a station's community of license. If the FCC adopts such proposals, the burden of complying with such requirements could impose additional costs on our stations.

        The FCC is also charged with enforcing restrictions or prohibitions on the broadcast of obscene and indecent programs. In 2007, Congress increased the maximum monetary penalty for carriage of indecent programming tenfold to $325,000 per station per violation with a cap of $3 million for any "single act," and put the licenses of repeat offenders in jeopardy. At approximately the same time, the FCC increased its broadcast indecency enforcement activity and issued large fines against radio and television stations found to have carried indecent programming (even if originated by a third-party program supplier, such as a network). In 2010, the U.S. Court of Appeals for the Second Circuit found that the FCC's enforcement policy for broadcast indecency was unconstitutionally vague. The FCC successfully petitioned the United States Supreme Court to grant certiorari, and, on June 21, 2012, the Supreme Court set aside the specific FCC decisions at issue, finding that a lack of notice of a change to the FCC's enforcement of its broadcast indecency rules violated the broadcasters' due process rights. The Supreme Court did not reach the broadcasters' First Amendment challenge of the FCC's broadcast indecency regime, and so we are unable to predict the extent to which future enforcement of the FCC's broadcast indecency rules may have a material adverse effect on our ability to provide competitive programming.

        Recent Regulatory Developments, Proposed Legislation and Regulation.    Congress and the FCC currently have under consideration, and may in the future adopt, new laws, regulations and policies regarding a wide variety of matters that could affect, directly or indirectly, the operation and ownership of our stations. The foregoing discussion summarizes the federal statutes and regulations material to our operations, but does not purport to be a complete summary of all the provisions of the Communications Act or of other current or proposed statutes, regulations, and policies affecting our business. The summaries should be read in conjunction with the text of the statutes, rules, regulations, orders, and decisions described herein. We are unable at this time to predict the outcome of any of the pending FCC rule-making proceedings referenced above, the outcome of any reconsideration or appellate proceedings concerning any changes in FCC rules or policies noted above, the possible outcome of any proposed or pending Congressional legislation, or the impact of any of those changes on our stations.

Employees

        As of December 31, 2012, we employed 2,558 full time employees, 331 of which were represented by labor unions. We believe that our relations with our employees are satisfactory.

Available Information

        We file annual, quarterly, and current reports, proxy statements, and other documents with the Securities and Exchange Commission ("SEC") under the Exchange Act. The public may read and copy any materials that we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Also, the SEC maintains an Internet web site that contains reports, proxy and information statements, and other information regarding issuers, including our filings, which we file electronically with the SEC. The public can obtain any documents that we file with the SEC at http://www.sec.gov.

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        We make available free-of-charge through our Internet web site (at http://www.linmedia.com) copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and, if applicable, amendments to those reports filed or furnished pursuant to Section 13(a) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish such material to, the SEC. We will also provide a physical copy of our Annual Report on Form 10-K free of charge upon the written request of any shareholder.

        We also make available on our web site our corporate governance guidelines, the charters for our audit committee, compensation committee, and nominating and corporate governance committee, our code of business conduct and ethics, and our code of ethics for senior financial officers. This information is available on our web site to any stockholder who is interested in reviewing this information. In addition, we intend to disclose on our web site any amendments to, or waivers from, our code of business conduct and ethics that are required to be publicly disclosed pursuant to rules of the SEC and the NYSE.

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Item 1A.    Risk Factors

Risks Associated with Our Business Activities

Our operating results are primarily dependent on advertising revenues, which can vary substantially from period-to-period based on many factors beyond our control, including economic downturns and viewer preferences.

        Our operations and performance are dependent on advertising revenues, which can be materially affected by a number of factors beyond our control, including economic conditions and viewer preferences. Volatility in advertising revenue impacts our financial condition, cash flows and results of operations. Decreases in advertising revenues caused by economic conditions could have a material adverse effect on our financial condition, cash flows and results of operations, which could impair our ability to comply with the covenants in our debt instruments, as more fully described below.

        In addition to economic conditions, our ability to generate advertising revenues depends on factors such as:

    the relative popularity of the programming on our stations;

    the demographic characteristics of our markets; and

    the activities of our competitors.

        Our programming may not attract sufficient targeted viewership or we may not achieve favorable ratings. Our ratings depend partly upon unpredictable and volatile factors beyond our control, such as viewer preferences, competing programming and the availability of other entertainment activities. A shift in viewer preferences could cause our programming not to gain popularity or to decline in popularity, which could cause our advertising revenues to decline. We, and those on whom we rely for programming, may not be able to anticipate and react effectively to shifts in viewer tastes and interests of our local markets. In addition, political advertising revenue from elections and advertising revenues from Olympic Games, which generally occur in even-numbered years, create large fluctuations in our operating results on a year-to-year basis. For example, during 2012, we had net political advertising revenues of $76.5 million, compared to $8.1 million in the prior year.

We depend on automotive advertising to a significant degree.

        Approximately 26%, 24% and 23% of our local and national advertising revenues for the years ended December 31, 2012, 2011, and 2010, respectively, consisted of automotive advertising. A significant decrease in these revenues in the future could have a material adverse effect on our results of operations and cash flows, which could affect our ability to fund operations and service our debt obligations and affect the value of our common stock.

The Merger may not be completed, which would significantly increase our federal and state income tax liabilities in 2013 and may harm the market price of our class A common stock.

        Although our board of directors has approved the Merger and has approved and adopted the Merger Agreement, which effects the Merger, the completion of the Merger is subject to a number of conditions, and there is no assurance that all of the conditions to closing will be met and that the Merger will be completed. In addition, we reserve the right to cancel or defer the Merger even if our stockholders vote to approve the Merger and the other conditions to the completion of the Merger are satisfied or waived.

        While we currently expect the Merger to take place as soon as practicable after adoption of the Merger Agreement at the special meeting of our stockholders, our board of directors may defer the Merger for a significant time after the meeting or may abandon the Merger because of, among other reasons, an increase in the estimated cost of the Merger, including U.S. tax costs or other costs, changes in existing or proposed tax legislation, an increase in the trading price of our class A common stock above

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approximately $20 per share (at which point LIN TV will no longer recognize a capital loss as a result of the Merger) (see "We may not realize the anticipated benefits of the Merger because. . ." below in this section) or a determination by our board of directors that the Merger would not be in the best interests of our stockholders.

        While we will continue our operations if the Merger is not completed for any reason, our operations may be harmed in a number of ways, including the following:

    At the time of LIN Texas's acquisition of its 20.38% interest in SVH in 1998, we recorded a deferred tax liability on capital gains related to our equity interests in SVH that became a current tax payable upon the sale of such interests. Because the Merger is expected to have the effect of allowing us to use the capital loss in LIN TV's equity in LIN Television to, in whole or in part, offset such deferred tax liability, if the sale of LIN Texas's interest in SVH is completed without promptly completing the Merger it would cause a short-term deferred tax liability of approximately $163 million to become payable beginning in 2013. If necessary, we would seek to fund any such current federal and state tax liabilities and any interest and penalties for late payment of taxes, through cash generated from operations, amounts available under our revolving credit facility, and additional borrowings. However, there can be no assurance that additional borrowings will be available on acceptable terms or at all. Should additional borrowings be unavailable, we would defer payment of this tax liability into 2014 and incur late payment interest and penalties, and we believe that there are cost and capital expenditure reduction initiatives we could take in 2013 and 2014 that, based on our current forecast of operating results, would allow us to generate sufficient cash flows to fund our operations, the tax liabilities associated with the JV Sale Transaction, and related interest and penalties, and to maintain compliance with the financial covenants under our debt obligations into 2014. However, there can be no assurance that we will be successful in reducing our expenditures and generating sufficient cash from operations to fund the obligation in 2014.

    The market price of our class A common stock may decline to the extent that the current market price of such stock reflects a market assumption that the Merger will be completed.

    An adverse reaction from investors and potential investors to, among other things, the Merger may reduce future debt or equity financing opportunities for us and our subsidiaries.

    Costs related to the Merger, including legal and accounting fees, must be paid even if the Merger is not completed.

We may not realize the anticipated benefits of the Merger because of, among other reasons, changes in tax laws or an increase in the trading price of LIN TV class A common stock prior to the effective time of the Merger.

        Many factors could affect the outcome of the Merger, and some or all of the anticipated benefits of the Merger may not occur. The consequence of LIN TV's conversion of its form of organization from a corporation into a limited liability company structure in connection with the Merger will have the effect of classifying it as a partnership for federal income tax purposes. Such partnership classification will be treated as a liquidation of LIN TV for federal income tax purposes with the result that LIN TV will recognize gain or loss, as applicable, in its 100% equity interest in LIN Television (its sole asset at the time of the Merger).

        Each LIN TV stockholder should be aware that the U.S. federal income tax rules are constantly under review by persons involved in the legislative process, the IRS and the U.S. Treasury Department, frequently resulting in revised interpretations of established concepts, statutory changes, revisions to regulations and other modifications and interpretations. The present U.S. federal income tax treatment of an investment in LIN LLC common shares may be modified by administrative, legislative or judicial interpretation at any time, possibly on a retroactive basis and changes to the U.S. federal income tax laws

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and interpretations thereof could make it more difficult or impossible for us to realize all or any of the anticipated benefits of the Merger.

        Further, we will apply certain assumptions and conventions in an attempt to comply with applicable rules and to report income, gain, deduction, loss and credit to holders in a manner that reflects such holder's beneficial ownership of partnership items, taking into account variation in ownership interests during each taxable year because of trading activity. However, it is possible that our assumptions and conventions may not be in compliance with all aspects of applicable tax requirements. It is possible that the IRS may assert successfully that the conventions and assumptions used by us do not satisfy the technical requirements of the Internal Revenue Code and/or Treasury regulations and could require that items of income, gain, loss, deductions or credit, including interest deductions, be adjusted, reallocated or disallowed in a manner that adversely affects stockholders.

        In addition, the amount of tax loss that LIN TV will be able to recognize as a result of the Merger is dependent on the value of its assets at the time of the Merger (i.e., its 100% equity interest in LIN Television), which value directly correlates to the trading price of shares of LIN TV class A common stock. As the trading price of LIN TV class A common stock increases, the amount of tax loss that LIN TV will be able to recognize in its ownership of the equity in LIN Television upon consummation of the Merger decreases and, if such trading price increases above a certain amount, LIN TV would not have sufficient losses available from the Merger to offset the entire capital gain recognized in the JV Sale Transaction. In that event, LIN TV would be required to use cash on hand and/or some (or all) of its existing $273 million net operating losses to offset all or a substantial portion of any such remaining capital gain.

        For example, if the trading price of LIN TV class A common stock is at or below approximately $10.75 per share at the time of the Merger, then, upon completion of the Merger, LIN TV expects to recognize a sufficient amount of capital loss to offset all of the capital gain recognized in the JV Sale Transaction. However, we have estimated that if the trading price of LIN TV class A common stock exceeds approximately $12.20 per share, we will be subject to cash tax liabilities in excess of our available NOL carryforwards. In addition, it is possible that, if the trading price of LIN TV class A common stock significantly increases to a price greater than approximately $20 per share, LIN TV would not be able to recognize any tax losses as a result of the Merger to use to offset against the capital gain recognized in the JV Sale Transaction. Furthermore, at the time of the Merger, if LIN TV class A common stock is trading at a price greater than approximately $20 per share, it is probable that LIN TV's board of directors would not consummate the Merger because LIN TV would not be able to recognize a tax loss and, as a result, LIN TV would be required to use all of its existing net operating losses and pay any resulting tax liabilities from the JV Sale Transaction with cash on hand and available borrowings (which may be insufficient).

The current market price of LIN TV class A common stock may not be indicative of the market price of LIN LLC class A common shares following the Merger.

        The current price for the LIN TV class A common stock may not be indicative of how the market will value the LIN LLC class A common shares following the Merger because of the change in our legal structure. The LIN TV class A common stock current stock price does not necessarily take into account the effects or changes that will result from the completion of the Merger, and the share price of the LIN LLC class A common shares after the Merger could be lower than the current stock price of the LIN TV class A common stock.

Our board of directors may choose to defer or abandon the Merger at any time.

        Completion of the Merger may be deferred or abandoned by action of our board of directors at any time, including after LIN TV stockholder approval at the special meeting. While we currently expect the Merger to take place promptly after the proposal to adopt the Merger Agreement is approved at the special meeting, our board of directors may defer completion before or after the special meeting or may

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abandon the Merger at any time, including after stockholder approval, because of, among other reasons, our failure to receive tax opinions from its advisors in form and substance acceptable to us, our determination that the LIN LLC class A common shares will not be eligible for inclusion for trading on the NYSE, our determination that the IRS does not agree with our views on certain tax matters, our determination that the Merger and the other reorganization transactions would involve tax or other risks that outweigh their benefits, our determination that the level of expected benefits associated with the Merger would otherwise be reduced, changes in U.S. tax laws, rates, treaties or regulations that would adversely affect our ability to achieve the expected benefits of the Merger, an unexpected increase in the cost to complete the Merger or any other determination by our board of directors that the Merger would not be in the best interests of LIN TV or its stockholders or that the Merger would have material adverse consequences to LIN TV or its stockholders.

Substantial sales of the LIN TV class A common stock prior to, or substantial sales of LIN LLC class A common shares following, the Merger could occur, which, in each case, could cause our share price to decline.

        The LIN LLC class A common shares received in the Merger generally may be sold in the public markets immediately following the Merger. Some LIN TV stockholders may sell their LIN TV class A common stock shortly before, or some LIN LLC shareholders may sell their LIN LLC class A common shares after the Merger, for any number of reasons. In particular, certain of LIN TV's stockholders may be subject to investment guidelines that require that a specified percentage of their portfolio be investments that are not taxed as a partnership for U.S. federal income tax purposes or may simply not wish to hold LIN LLC class A common shares. In addition, holders of LIN LLC class A common shares may sell their shares because of the amount of taxable income they may otherwise recognize as a result of the Merger. The sale of a significant amount of LIN TV class A common stock, or the perception in the market that this will occur, may lower the market price of shares of LIN TV class A common stock.

We expect to incur transaction costs in connection with the completion of the Merger, some of which will be incurred whether or not the Merger is completed.

        We incurred in 2012 and we expect to continue to incur in 2013 a total of approximately $5 to $7 million in transaction costs in connection with the Merger and the JV Sale Transaction, including, among others, financial and tax advisory fees and expenses, legal fees, printing and mailing costs associated with the preparation of a proxy statement/prospectus. The majority of these costs will be incurred regardless of whether the Merger is completed and prior to our stockholders' vote at the special meeting. Further, the Merger and the other transactions described in this report may also result in certain indirect costs by diverting the attention of our management and employees from our business and by increasing our administrative costs and expenses.

Although as a result of the JV Sale Transaction none of LIN TV or any of its direct or indirect subsidiaries has any further obligations (funding or otherwise) under the GECC Note, the GECC Guarantee or related to SVH, the Transaction Agreement contains certain ongoing indemnification obligations of each party that could result in future liabilities to us.

        Each of LIN TV, LIN Television and LIN Texas made customary representations, warranties and covenants in the JV Sale Transaction Agreement for the benefit of the other parties to the agreement, including, among others, representations and warranties with respect to the ownership of the interest in SVH, the power and authority to enter into the JV Sale Transaction Agreement and any consents that may have been necessary to complete the transactions contemplated thereby.

        The JV Sale Transaction Agreement also contains certain ongoing indemnification obligations of each party (including LIN TV, LIN Television and LIN Texas) to the other parties relating to the representations, warranties and covenants of each party and if we (or LIN Television or LIN Texas) are

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found to be in breach of any applicable representations, warranties and covenants it could result in future liabilities to us in favor of the other parties.

We have a substantial amount of debt, which could adversely affect our financial condition, liquidity and results of operations, reduce our operating flexibility and put us at greater risk for default and acceleration of our debt.

        As of December 31, 2012, we had approximately $843.9 million of consolidated net debt, which is equal to the difference between total debt and the sum of unrestricted and restricted cash, and $91.6 million of total LIN TV stockholders' deficit. In addition, in connection with the JV Sale Transaction, we borrowed $25 million under our revolving credit facility and entered into a new $60 million incremental term facility under our existing senior secured credit facility in January and February 2013, respectively. The outstanding revolving credit loans and term loans under our senior secured credit facility which were $5 million and $125 million, respectively, as of March 15, 2013, and are due October 26 2017 and the outstanding incremental term loans under our senior secured credit facility were $317.4 million as of March 15, 2013 and are due on December 21, 2018. The outstanding Senior Notes (as defined below), which were $200 million and $290 million as of March 15, 2013 are due on April 15, 2018 and January 15, 2021, respectively. Subject to the limitations in our senior secured credit facility and the indentures governing our Senior Notes, we may incur additional material indebtedness in the future, and we may become more leveraged. Accordingly, we now have and will continue to have significant debt service obligations. Our large amount of indebtedness could, for example:

    require us to use a substantial portion of our cash flow from operations to pay interest and principal on indebtedness and reduce the availability of our cash flow to fund working capital, capital expenditures, acquisitions and other general corporate activities;

    require us to dispose of television stations or other assets at times or on terms that may be less advantageous than those we might otherwise be able to obtain;

    limit our ability to obtain additional financing in the future;

    expose us to greater interest rate risk, because the interest rates on our senior secured credit facility vary; and

    impair our ability to successfully withstand a sustained downturn in our business or the economy in general and place us at a disadvantage relative to our less leveraged competitors.

        The indentures governing our Senior Notes also contain change of control provisions which may require us to purchase all or a portion of our Senior Notes at a price equal to 101% of the principal amount of the notes, together with accrued and unpaid interest.

        Any of these consequences relating to such debt could have a material adverse effect on our business, liquidity and results of operations.

We could fail to comply with our financial covenants, which would adversely affect our financial condition.

        Our debt instruments require us to comply with financial covenants, including, among others, leverage ratios. These covenants restrict the manner in which we conduct our business and may impact our operating results. Weak results of operations due to reduced advertising revenues may make it harder for us to comply with such covenants. Our failure to comply with these covenants could result in events of default, which, if not cured or waived, would permit acceleration of our indebtedness under our debt agreements or under other instruments that contain cross-acceleration or cross-default provisions.

        Our debt instruments also contain certain other restrictions on our business and operations, including, for example, covenants that restrict our ability to dispose of assets, incur additional indebtedness, pay dividends, make investments, make acquisitions and engage in mergers or consolidations.

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We may not be able to refinance all or a portion of our indebtedness or obtain additional financing on satisfactory terms.

        The outstanding revolving credit loans and term loans under our secured credit facility are due October 26, 2017 and the outstanding incremental term loans under our senior secured credit facility are due December 21, 2018. Our outstanding Senior Notes are due on April 15, 2018 and January 15, 2021, respectively. If we do not refinance, redeem or discharge our Senior Notes on or prior to January 15, 2018, then, in such event, the maturity of the incremental term loan facility will be accelerated from December 21, 2018 to January 15, 2018. While we expect to refinance, redeem, or discharge all of the outstanding Senior Notes prior to January 15, 2018, we can provide no assurances that this will occur. Our inability to refinance our Senior Notes prior to January 15, 2018, and the resulting acceleration of the incremental term loans would have a material adverse effect on our business, liquidity and results of operations.

Economic conditions may have an adverse impact on our industry, business, results of operations or financial condition.

        Economic conditions have been challenging and the continuation or worsening of such conditions could further reduce consumer confidence and have an adverse effect on the fundamentals of our business, financial condition, cash flows and results of operations. Poor economic conditions could have a negative impact on our industry or the industry of those customers who advertise on our stations, including, among others, the automotive industry, which is a significant source of our advertising revenue. Additionally, financial institutions, capital providers, or other consumers may be adversely affected. Potential consequences of any economic decline, among others, include:

    the financial condition of those companies that advertise on our stations may be adversely affected and could result in a significant decline in our advertising revenue;

    our ability to pursue the acquisition of attractive television and non-television assets may be limited if we are unable to obtain any necessary additional capital on favorable terms, if at all;

    our ability to pursue the divestiture of certain television and non-television assets at attractive values may be limited;

    our ability to refinance our existing debt on terms and at interest rates we find attractive, if at all, may be impaired;

    impairment charges to our intangible assets and/or goodwill; and

    our ability to make certain capital expenditures may be significantly impaired.

We have a material amount of intangible assets and we have recorded substantial impairments of these assets. Future write-downs of intangible assets would reduce net income or increase net loss, which could have a material adverse effect on our results of operations and the value of our class A common stock.

        Future impairment charges could have a significant adverse effect on our reported results of operations. Approximately $725.7 million, or 58.5%, of our total assets as of December 31, 2012 consisted of indefinite-lived intangible assets. Intangible assets principally include broadcast licenses and goodwill, which are required to be tested for impairment at least annually, with impairment being measured as the excess of the carrying value of the goodwill or the intangible asset over its fair value. In addition, goodwill and other intangible assets will be tested more often for impairment as circumstances warrant.

        During the year ended December 31, 2011, we recorded a $1.6 million impairment charge to a broadcast license recorded within discontinued operations.

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        If we determine in a future period, as part of our testing for impairment of intangible assets and goodwill, that the carrying amount of our intangible assets exceeds the fair value of these assets, we may incur an impairment charge that could have a material adverse effect on our results of operations and the value of our class A common stock.

Our strategy has historically included growth through acquisitions, which could pose various risks and increase our leverage.

        We have pursued and intend to selectively continue to pursue strategic acquisitions, subject to market conditions, our liquidity, and the availability of attractive acquisition candidates, with the goal of improving our business. We may not be successful in identifying attractive acquisition targets nor have the financial capacity to complete future acquisitions. Acquisitions involve inherent risks, such as increasing leverage, debt service requirements, future performance-based purchase obligations and combining company cultures and facilities, which could have a material adverse effect on our operating results, particularly during the period immediately following any acquisition. We may not be able to successfully implement effective cost controls or increase revenues as a result of any acquisition. In addition, future acquisitions may result in our assumption of unexpected liabilities and may result in the diversion of management's attention from the operation of our core business.

        Certain acquisitions, such as television stations, are subject to the approval of the FCC and, potentially, other regulatory authorities. The need for FCC and other regulatory approvals could restrict our ability to consummate future transactions and potentially require us to divest some television stations if the FCC believes that a proposed acquisition would result in excessive concentration in a market, even if the proposed combinations may otherwise comply with FCC ownership limitations.

HMC and its affiliates, whose interests may differ from your interests, have approval rights with respect to significant transactions and could convert their equity interests in our Company into a block of substantial voting power, thereby reducing the voting power of our other stockholders.

        HMC and its affiliates own one share of our class C common stock, which represents 35% of our outstanding voting power, and also have the ability to convert shares of our non-voting class B common stock into class A common stock, which may be subject to FCC approval. Upon the conversion of the majority of the non-voting class B common stock into class A common stock, the class C common stock will automatically convert into an equal number of shares of class A common stock. If this occurs, affiliates of HMC would own approximately 43.1% of our voting equity interests and will effectively have the ability to elect the entire board of directors and to approve or disapprove any corporate transaction or other matters submitted to our stockholders for approval, including the approval of mergers or other significant corporate transactions. The interests of HMC and its affiliates may differ from the interests of our other stockholders and HMC and its affiliates could take actions or make decisions that are not in the best interests of our other stockholders.

        For example, HMC may from time-to-time acquire and hold controlling or non-controlling interests in television broadcast assets that may directly or indirectly compete with our company for advertising revenues. In addition, HMC and its affiliates may from time-to-time identify, pursue and consummate acquisitions of television stations or other broadcast related businesses that may be complementary to our business and therefore such acquisition opportunities may not be available to us.

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        Moreover, Royal W. Carson, III, a director, and HMC, combined beneficially own all of our class C common stock and therefore possess 70% of the combined voting power. Accordingly, Mr. Carson and HMC together have the power to elect our entire board of directors and, through this control, to approve or disapprove any corporate transaction or other matter submitted to our stockholders for approval, including the approval of mergers or other significant corporate transactions. Mr. Carson has prior business relations with HMC. Mr. Carson is the President of Carson Private Capital Incorporated, an investment firm that sponsors funds-of-funds and dedicated funds that have invested substantially all of the net capital of these funds in private equity investment funds sponsored by firms like HMC or its affiliates. Mr. Carson also serves on an advisory board representing the interests of limited partners of Hicks, Muse, Tate & Furst Equity Fund V, L.P.; Sector Performance Fund, L.P.; and Hicks, Muse, Tate & Furst Europe Fund L.P., which are sponsored by HMC. The three listed funds do not have an investment in us.

If we are unable to compete effectively, our revenue could decline.

        The entertainment industry, and particularly the television industry, is highly competitive and is undergoing a period of consolidation and significant change. Many of our current and potential competitors have greater financial, marketing, programming and broadcasting resources than we do. Technological innovation and the resulting proliferation of television entertainment alternatives, such as cable, satellite television and telecommunications video services, Internet, wireless, pay-per-view and video-on-demand, digital video recorders, DVDs and mobile video devices have fragmented television viewing audiences and have subjected free over-the-air television broadcast stations to new types of competition. As a result, we are experiencing increased competition for viewing audience and advertisers. Significant declines in viewership and advertising revenues could materially and adversely affect our business, financial condition and results of operations.

New technologies may affect our broadcasting operations.

        The television broadcasting business is subject to rapid technological change, evolving industry standards, and the emergence of new technologies. We cannot predict the effect such technologies will have on our broadcast operations. In addition, the capital expenditures necessary to implement these new technologies could be substantial and other companies employing such technologies before we are able to do so could aggressively compete with our business.

It would be difficult to take us over, which could adversely affect the trading price of our class A common stock.

        Affiliates of HMC effectively have the ability to determine whether a change of control will occur through their ownership of one of the two outstanding shares of our class C common stock and all of the shares of our class B common stock. Provisions of Delaware corporate law and our bylaws and certificate of incorporation, including the 70% voting power of our class C common stock held by affiliates of Mr. Carson and HMC and the voting power that affiliates of HMC would hold upon conversion of their shares of class B stock into class A stock or class C stock, make it difficult for a third party to acquire control of us, even if a change of control would benefit the holders of our class A common stock. These provisions and controlling ownership by affiliates of HMC could also adversely affect the public trading price of our class A common stock.

The loss of network affiliation agreements or changes in network affiliations could have a material and adverse effect on our results of operations.

        The non-renewal or termination of a network affiliation agreement or a change in network affiliations could have a material adverse effect on us. Each of the networks generally provides our affiliated stations with up to 22 hours of prime time programming per week. In return, our stations broadcast network-inserted commercials during that programming. In some cases, we make cash payments to certain networks.

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        Some of our network affiliation agreements are subject to earlier termination by the networks under specified circumstances, including as a result of a change of control of our Company, which would generally result upon the acquisition of shares having 50% or more of our voting power. In the event that affiliates of HMC elect to convert our class B common stock shares held by them into shares of either class A common stock or class C common stock, such conversion may result in a change of control of our Company causing an early termination of some or all of our network affiliation agreements. The majority of the networks with which our stations are affiliated have required us, upon renewal of affiliation agreements, to make cash payments to the network and to accept other material modifications of existing affiliation agreements. Consequently, our affiliation agreements may not all remain in place and each network may not continue to provide programming to us on the same basis as it currently provides programming. If any of our stations cease to maintain affiliation agreements with networks for any reason, we would need to find alternative sources of programming, which may be less attractive and more expensive.

        A change in network affiliation in a given television market may have many short-term and long-term consequences, depending upon the circumstances surrounding the change. Potential short-term consequences include: (i) increased marketing costs and increased internal operating costs, which can vary widely depending on the amount of marketing required to educate the audience regarding the change and to maintain the station's viewing audience; (ii) short term loss of market share or slower market growth due to advertiser uncertainty about the switch; (iii) costs of building a new or larger news operation; (iv) other increases in station programming costs, if necessary; and (v) the cost of equipment needed to conform the station's programming, equipment and logos to the new network affiliation. Long-term consequences are more difficult to assess, due to the cyclical nature of each of the major network's share of the audience that changes from year-to-year with programs coming to the end of their production cycle, and the audience acceptance of new programs in the future and the fact that national network audience ratings are not necessarily indicative of how a network's programming is accepted in an individual market. How well a particular network fares in an affiliation switch depends largely on the value of the broadcast license, which is influenced by the length of time the television station has been broadcasting, the quality and location of the license, the audience acceptance of the local news programming and community involvement of the local television station and the quality of the station non-network programming. In addition, the majority of the revenue earned by television stations is attributable to locally produced news and syndicated programming, rather than advertising sales related to network programming. The circumstances that may surround a network affiliation switch cause uncertainty as to the actual costs that will be incurred by us and, if these costs are significant, the switch could have a material adverse impact on the income we derive from the affected station.

Changes by the national broadcast television networks in their respective business models and practices could adversely affect our business, financial condition and results of operations.

        In recent years, the national broadcast networks have streamed their programming on the Internet and other distribution platforms in close proximity to network programming broadcast on local television stations, including those we own. These and other practices by the networks dilute the exclusivity and value of network programming originally broadcast by the local stations and could adversely affect the business, financial conditions and results of operations of our stations.

We depend on key personnel, and we may not be able to operate and grow our businesses effectively if we lose the services of our management or are unable to attract and retain qualified personnel in the future.

        We depend on the efforts of our management and other key employees. The success of our business depends heavily on our ability to develop and retain management and to attract and retain qualified personnel in the future. Competition for senior management personnel is intense and we may not be able

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to retain our key personnel. If we are unable to do so, our business, financial condition or results of operations may be adversely affected.

Risks Related to Our Industry

The FCC's Spectrum Incentive Auctions proceeding could result in the reallocation of broadcast spectrum for wireless broadband use, which could materially impair our ability to provide competitive services.

        Pursuant to The American Recovery and Reinvestment Act of 2009, on March 16, 2010, the FCC delivered to Congress a staff report titled, "Connecting America: The National Broadband Plan" (the "NBP"). Among the many far-reaching recommendations contained in the 375-page NBP is that the FCC reallocate 120 MHz of spectrum currently occupied by television broadcast stations to mobile wireless broadband services by means of, among other things, amending the FCC's technical rules to reduce television station service areas and distance separations, permitting channel sharing, conducting voluntary "incentive" auctions for the return of television broadcast spectrum, and certain other voluntary and involuntary mechanisms. The NBP also recommended spectrum "repacking," pursuant to which certain stations would be required to move to new channels, and suggested the imposition of spectrum usage fees, which may require Congressional authorization. None of the NBP's recommendations related to television spectrum are self-effectuating; consequently, implementation of the recommendations would appear to require further action by the FCC or Congress, or both.

        On November 30, 2010, the FCC initiated a rulemaking proceeding to consider proposals to, among other things, implement rule changes that could facilitate channel sharing by television stations and shared use of current television broadcast spectrum by wireless broadband providers. In that proceeding, the FCC also sought comment on ways to improve VHF spectrum band television operations (VHF stations have experienced reception difficulties following the DTV transition), to encourage stations on UHF channels to move to VHF channels. On April 27, 2012, the FCC adopted rules establishing a framework for multiple full-service and Class A television stations operating within the same market to share a single 6 MHz television channel while retaining distinct station licenses and MVPD carriage rights. Under the FCC's new rules, only those stations participating in the future incentive auction will be eligible to enter into channel sharing arrangements of this type. Because the FCC has not yet implemented rules for the incentive auction, stations are not yet able to enter into channel sharing arrangements of this type. Accordingly, we cannot predict the impact that channel sharing among television stations will have on either the industry or our operations. This proceeding remains pending with respect to proposals to improve VHF band television operations and to enable shared use of television band spectrum with wireless broadband providers; we cannot predict its outcome or its impact on the industry or our operations.

        On February 17, 2012, Congress adopted legislation authorizing the FCC to direct a portion of auction proceeds to commercial users, including broadcasters, that voluntarily surrender some or all of their allotted spectrum for auction. The legislation, which the President subsequently signed into law, includes safeguards for broadcasters. In particular, the legislation requires the FCC to make all reasonable efforts to ensure that stations retain their existing coverage areas, prevents the FCC from forcing a broadcaster to move from a UHF to a VHF channel, and establishes a fund to reimburse broadcasters for reasonable relocation expenses arising from repacking the television bands. On October 2, 2012, the FCC released a Notice of Proposed Rule Making to implement the incentive auction statute. That proceeding remains pending. If the FCC requires some or all of our television stations to make involuntary changes to their operations, such as through frequency changes, reductions of service areas, and/or reductions of interference protection, our stations could suffer material adverse effects, including, but not limited to, substantial conversion costs, and reduction or loss of over-the-air signal coverage. We cannot predict the outcome of any FCC proceedings, including but not limited to the procedures for, or timing of, voluntary auctions and/or involuntary spectrum repacking.

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We may be unable to successfully negotiate future retransmission consent agreements and these negotiations may be further hindered by the interests of networks with whom we are affiliated or by statutory or regulatory developments.

        We may be unable to successfully renegotiate retransmission consent agreements with MVPDs when the current terms of these agreements expire. In addition, our affiliation agreements with some broadcast networks include certain terms that may affect our ability to permit MVPDs to retransmit our stations' signals containing network programming, and in some cases, we may lose the right to grant retransmission consent to such providers. If the broadcast networks withhold their consent to the retransmission of those portions of our stations' signals containing network programming we may be unable to successfully complete negotiations for new retransmission consent agreements. A majority of the networks require us to pay them compensation in exchange for permitting redistribution of network programming by MVPDs. Escalating payments to networks in connection with signal retransmission may adversely affect our operating results. If we lose the right to grant retransmission consent, we may be unable to satisfy certain obligations under our existing retransmission consent agreements with MVPDs and there could be a material adverse effect on our results of operations.

        Several cable system and DBS operators jointly petitioned the FCC to initiate a rulemaking proceeding to consider amending its retransmission consent rules. The FCC solicited public comment on the petition and subsequently released a notice of proposed rule making seeking public comment on whether it should amend its rules to: (i) modify its standards for "good faith" negotiations of retransmission consent agreements; (ii) enhance consumer notice obligations; and (iii) eliminate the FCC's network non-duplication and syndicated exclusivity rules. The proceeding is currently pending, and we cannot predict its outcome.

Our industry is subject to significant syndicated and other programming costs, and increased programming costs could adversely affect our operating results.

        Our industry is subject to significant syndicated and other programming costs. We often acquire program rights two or three years in advance, making it difficult for us to accurately predict how a program will perform. In some instances, we may have to replace programs before their costs have been fully amortized, resulting in impairments and write-offs that increase station operating costs. We may be exposed to future programming cost increases, which may adversely affect our operating results.

Federal regulation of the broadcasting industry limits our operating flexibility, which may affect our ability to generate revenue or reduce our costs.

        The FCC regulates our business, just as it does all other companies in the broadcasting industry. We must ask the FCC's approval whenever we need a new license, seek to renew, assign or modify a license, purchase a new station, sell an existing station or transfer the control of one of our subsidiaries that holds a license. Our FCC licenses, those of the stations that we service via sharing arrangements are critical to our operations; we cannot operate without them. We cannot be certain that the FCC will renew these licenses in the future or approve new acquisitions in a timely manner, if at all. If licenses are not renewed or acquisitions approved, we may lose revenue that we otherwise could have earned.

        In addition, Congress and the FCC may, in the future, adopt new laws, regulations and policies regarding a wide variety of matters (including retransmission consent, spectrum allocation, media ownership and technological changes) that could, directly or indirectly, materially and adversely affect the operation and ownership of our broadcast properties. (See Item 1. Business—"Federal Regulation of Television Broadcasting").

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Changes in FCC ownership rules through FCC action, judicial review or federal legislation may limit our ability to continue providing services to stations under sharing arrangements (such as LMAs, JSAs, SSAs and other similar agreements) may prevent us from obtaining ownership of the stations we currently provide services to under sharing arrangements, may require us to amend or terminate certain agreements and/or may preclude us from obtaining the full economic value of one or more of our duopoly, or two-station operations upon a sale, merger or other similar transaction transferring ownership of such station or stations.

        FCC ownership rules currently impose significant limitations on the ability of broadcast licensees to have attributable interests in multiple media properties. Federal law prohibits one company from owning broadcast television stations that collectively have service areas encompassing more than an aggregate 39% share of national television households. Ownership restrictions under FCC rules also include a variety of local limits on media ownership. The restrictions include an ownership limit of one television station in most medium and smaller television markets and two stations in most larger markets, known as the television duopoly rule. The regulations also include limits on the common ownership of a newspaper and television station in the same market (newspaper-television cross-ownership), limits on common ownership of radio and television stations in the same market (radio-television station ownership) and limits on radio ownership of four to eight radio stations in a local market.

        Should the FCC liberalize media ownership rules, attractive opportunities may arise for additional television station and other media acquisitions. But these changes also create additional competition for us from other entities, such as national broadcast networks, large station groups, newspaper chains and cable operators, which may be better positioned to take advantage of such changes and benefit from the resulting operating synergies both nationally and in specific markets.

        Should the television duopoly rule be relaxed, we may be able to acquire the ownership of one or more of the stations in Austin, TX, Dayton, OH, Providence, RI, Albuquerque, NM, Savannah, GA, Topeka, KS and Youngstown, OH for which we currently provide programming, sales and/or other related services under sharing arrangements, as the case may be, and for which we have purchase option agreements to purchase these stations.

        Should we be unable to acquire the ownership of the stations currently serviced by LMAs, there is no assurance that the grandfathering of our LMAs will be permitted beyond conclusion of the FCC's current review of the ownership rules.

        Should the FCC conclude, as part of its current review of its ownership rules, that SSAs, JSAs, and similar arrangements should be attributable for purposes of the media ownership rules, there is no assurance that the FCC would grandfather the non-attributable status of our existing agreements, and, as a result, we may be required to terminate these agreements.

Any potential hostilities, natural disasters, cybersecurity threats, breaches of information technology security, terrorist attacks or other disruptions may affect our revenues and results of operations.

        If the U.S. becomes engaged in new, large scale foreign hostilities, is impacted by any significant natural disasters or if there is a terrorist attack against the U.S., we may lose advertising revenue and incur increased broadcasting expenses due to pre-emption, delay or cancellation of advertising campaigns and increased costs of providing news coverage of such events. In light of the increased dependence on digital technologies by public companies and the increasing frequency and severity of cyber incidents, we may be subject to cybersecurity risks or other breaches of information technology security. A breach of our cyber/data security measures could disrupt our normal business operations and affect our ability to control our assets, access information and limit communication with third parties. We cannot predict the extent and duration of any future disruption to our programming schedule, the amount of advertising revenue that would be lost or delayed or the amount by which our expenses would increase as a result. Consequently, any related future loss of revenue and increased expenses could negatively affect our results of operations.

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Item 1B.    Unresolved Staff Comments

        None.

Item 2.    Properties

        We maintain our corporate headquarters in Providence, RI under an operating lease that expires on March 31, 2015.

        Each of our stations has facilities consisting of offices, studios, sales offices and tower and transmitter sites. Tower and transmitter sites are located in areas that provide optimal coverage to each of our markets. We own substantially all of the offices and studios where our stations are located and generally own the property where our towers and primary transmitters are located. We lease the remaining properties, consisting primarily of sales office locations and microwave transmitter sites. While none of the station properties owned or leased by us are individually material to our operations, if we were required to relocate any of our towers, the cost could be significant. This is because the number of sites in any geographic area that permit a tower of reasonable height to provide good coverage of the market is limited, and zoning and other land use restrictions, as well as Federal Aviation Administration and FCC regulations, limit the number of alternative locations or increase the cost of acquiring them for tower sites.

Item 3.    Legal Proceedings

        We are involved in various claims and lawsuits that are generally incidental to our business. We are vigorously contesting all of these matters. The outcome of any current or future litigation cannot be accurately predicted. We record accruals for such contingencies to the extent that we conclude it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. No estimate of the possible loss or range of loss can be made at this time because the inherently unpredictable nature of legal proceedings may be exacerbated by various factors, including: (i) the damages sought in the proceedings are unsubstantiated or indeterminate; (ii) discovery is not complete; (iii) the proceeding is in its early stages; (iv) the matters present legal uncertainties; (v) there are significant facts in dispute; or (vi) there is a wide range of potential outcomes. Although the outcome of these and other legal proceedings cannot be predicted, we believe that their ultimate resolution will not have a material adverse effect on us.

Item 4.    Mine Safety Disclosures

        Not applicable.

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PART II

Item 5.    Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

        Our class A common stock is listed on the NYSE under the symbol "TVL". There is no established trading market for our class B common stock or our class C common stock.

        The following table sets forth the high and low sales prices for our class A common stock for the periods indicated, as reported by the NYSE:

 
  High   Low  

2012

             

1st Quarter

  $ 5.00   $ 3.88  

2nd Quarter

    4.15     2.64  

3rd Quarter

    4.54     2.94  

4th Quarter

    7.80     4.35  

2011

             

1st Quarter

  $ 6.19   $ 4.37  

2nd Quarter

    6.50     4.22  

3rd Quarter

    4.92     2.18  

4th Quarter

    4.23     1.90  

        We have never declared or paid any cash dividends on our class A common stock and the terms of our indebtedness limit the payment of such dividends.

        As of December 31, 2012, there were approximately 39 stockholders of record of our class A common stock, 13 stockholders of record of our class B common stock and two stockholders of record of our class C common stock.

        The common stock of our wholly-owned subsidiary, LIN Television, all of which is held directly by us, has not been registered under the Exchange Act and is not listed on any national securities exchange.

Issuers Purchase of Equity Securities

        On November 14, 2012, we publicly announced that our Board of Directors extended our authorization to repurchase up to $25 million of our class A common stock in the open market, in privately negotiated transactions or pursuant to Rule 10b5-1 plan. This authorization expired on the earlier of the completion of all purchases contemplated by the plan or November 14, 2013; however, on February 12, 2013, as a result of entering into the Merger Agreement, we terminated the stock repurchase program. Prior to termination, we repurchased zero and 3,309,841 shares of our class A common stock at a cost of $0 and $11.4 million during the quarter and year ended December 31, 2012.

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Comparative stock performance graph

        The following graph compares the cumulative total return performance of our class A common stock for the five years ended December 31, 2012 versus the performance of: (i) the NYSE Composite Index; and (ii) a peer index consisting of the following broadcast television companies: Gray Communications Systems, Inc.; Sinclair Broadcasting Group, Inc.; Belo Corporation; and Nexstar Broadcasting Group, Inc. (the "Television Index"). The graph assumes the investment of $100 in our class A common stock and in each of the indices on December 31, 2007. The performance shown is not necessarily indicative of future performance.

GRAPHIC

 
  12/31/2007   12/31/2008   12/31/2009   12/31/2010   12/31/2011   12/31/2012  

LIN TV Corp. (TVL)

  $ 100.00   $ 8.96   $ 36.65   $ 43.55   $ 34.76   $ 61.87  

NYSE Composite Index

  $ 100.00   $ 59.11   $ 73.77   $ 81.77   $ 76.77   $ 86.69  

Television Index

  $ 100.00   $ 23.20   $ 51.26   $ 74.94   $ 99.54   $ 129.22  

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Item 6.    Selected Financial Data

        Set forth below is our selected consolidated financial data for each of the five years in the period ended December 31, 2012. The selected financial data as of December 31, 2012 and 2011 and for the years ended December 31, 2012, 2011 and 2010 is derived from audited consolidated financial statements that appear elsewhere in this report. The selected financial data should be read in conjunction with Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our historical consolidated financial statements and the notes thereto. All financial information shown reflect the operations of WWHO-TV in Columbus, OH, WUPW-TV in Toledo, OH, the Banks Broadcasting joint venture and the Puerto Rico stations as discontinued for all periods presented. The sale of WWHO-TV was completed on February 16, 2012 and the sale of WUPW-TV was completed on April 21, 2012. The Banks Broadcasting joint venture station was sold in 2009. Prior year amounts have been reclassified to conform to current year presentation.

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        The selected consolidated financial data of LIN Television is identical to LIN TV with the exception of basic and diluted loss per common share, which is not presented for LIN Television.

 
  Year Ended December 31,  
 
  2012   2011   2010   2009   2008  
 
  (in thousands, except per share data)
 

Consolidated Statement of Operations Data:

                               

Net revenues(1)

  $ 553,462   $ 400,003   $ 408,190   $ 327,842   $ 384,787  

Impairment of goodwill, broadcast licenses

                               

and broadcast equipment

                39,487     1,013,163  

Operating income (loss)

    171,061     89,104     111,839     22,294     (936,959 )

Loss (gain) on extinguishment of debt

    3,341     1,694     2,749     (50,149 )   (8,822 )

(Loss) income from continuing operations(2)

    (17,972 )   49,701     36,181     9,704     (822,122 )

(Loss) income from discontinued operations, net of tax

    (1,018 )   (920 )   317     (591 )   (12,649 )

Gain from the sale of discontinued operations, net of tax

    11,389                  

Net (loss) income

    (7,601 )   48,781     36,498     9,113     (834,771 )

Net (loss) income attributable to noncontrolling interests

    (556 )   204              

Net (loss) income attributable to LIN TV Corp. 

    (7,045 )   48,577     36,498     9,113     (834,771 )

Basic (loss) income per common share attributable to LIN TV Corp.:

                               

(Loss) income from continuing operations attributable to LIN TV Corp. 

    (0.32 )   0.89     0.67     0.19     (16.16 )

(Loss) income from discontinued operations, net of tax

    (0.02 )   (0.02 )   0.01     (0.01 )   (0.25 )

Gain from sale of discontinued operations, net of tax

    0.21                  
                       

Net (loss) income attributable to LIN TV Corp. 

  $ (0.13 ) $ 0.87   $ 0.68   $ 0.18   $ (16.41 )
                       

Weighted-average basic shares outstanding

    54,130     55,768     53,978     51,464     50,865  

Diluted (loss) income per common share attributable to LIN TV Corp.:

                               

(Loss) income from continuing operations attributable to LIN TV Corp. 

  $ (0.32 ) $ 0.87   $ 0.65   $ 0.19   $ (16.16 )

(Loss) income from discontinued operations, net of tax

    (0.02 )   (0.02 )   0.01     (0.01 )   (0.25 )

Gain from the sale of discontinued operations, net of tax

    0.21                  
                       

Net (loss) income attributable to LIN TV Corp. 

  $ (0.13 ) $ 0.85   $ 0.66   $ 0.18   $ (16.41 )
                       

Weighted-average diluted shares outstanding

    54,130     57,079     55,489     51,499     50,865  

Consolidated Balance Sheet Data (at period end):

                               

Cash and cash equivalents

  $ 46,307   $ 18,057   $ 11,648   $ 11,105   $ 20,106  

Restricted cash

        255,159         2,000      

Broadcast licenses, intangible assets, net and goodwill

    785,339     522,150     504,512     506,061     536,803  

Total assets

    1,241,414     1,081,944     790,469     790,503     852,594  

Total debt

    890,227     868,717     623,260     682,954     743,353  

Consolidated net debt(3)

    843,920     595,501     611,612     671,849     723,247  

Total LIN TV Corp. stockholders' (deficit) equity

    (91,564 )   (84,632 )   (131,432 )   (173,561 )   (193,688 )

Other Data:

                               

Distributions from equity investments

  $   $   $   $   $ 2,649  

Program payments

  $ 24,258   $ 24,622   $ 25,066   $ 23,081   $ 24,913  

(1)
Net revenues for the year ended December 31, 2012 include approximately $41 million of revenues attributable to net revenues earned by stations acquired during the fourth quarter of 2012.

(2)
Net loss during the year ended December 31, 2012 includes the financial impact of the JV Sale Transaction; specifically, (i) a $94 million charge associated with the $100 million capital contribution and (ii) the reversal of a $6 million shortfall loan obligation to the joint venture.

(3)
Consolidated net debt is a non-GAAP financial measure, and is equal to total debt less cash and cash equivalents. Solely for the purpose of computing consolidated net debt as of December 31, 2011, our senior secured credit facility permits restricted cash to be offset against total debt. Beginning in 2012, for the purpose of our debt covenant calculations, our senior credit facility permits a maximum of $45 million to be offset against total debt in arriving at consolidated net debt. For purposes of the consolidated balance sheet data above, we have subtracted the total balance of our cash and cash equivalents as of December 31, 2012 in arriving at consolidated net debt. Consolidated net debt provides investors with useful information about our financial position, and is one of the financial measures used to evaluate compliance with our debt covenants.

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Item 7.   Management's Discussion and Analysis of Financial Condition and Results of Operations

Executive Summary

        We own, operate or service 43 television stations and seven digital channels in 23 U.S. markets, with multiple network affiliates in 18 markets, along with a diverse portfolio of web sites, apps and mobile products. Our operating revenues are primarily derived from the sale of advertising time to local, national and political advertisers. Less significant revenues are generated from our television station web sites, retransmission consent fees, interactive revenues and other revenues. We recorded net (loss) income of ($7.6) million, $48.8 million and $36.5 million for the years ended December 31, 2012, 2011, and 2010, respectively.

        Our operating highlights for 2012 include the following:

    Net revenues increased $153.5 million, or 38%, compared to 2011, primarily as a result of a $68.3 million increase in net political advertising sales as well as an increase of $61 million, or 24%, in local revenues, which include net local advertising sales, retransmission consent fees and television station web site revenues. Also contributing to the increase in net revenues was an increase in interactive revenues, which include revenues from LIN Digital and Nami Media of $13.9 million, or 51%, and an increase in net national revenues of $11.6 million, or 12%. Television stations acquired during the fourth quarter of 2012 accounted for approximately $41 million of our net revenues for the year ended December 31, 2012.

    On February 12, 2013, we entered into and closed the JV Sale Transaction whereby in exchange for LIN Television causing a $100 million capital contribution to SVH (which was used to prepay a portion of the GECC Note), LIN Texas sold its interest in SVH, a joint venture with NBC, and LIN TV was released from the GECC Guarantee and any further obligations related to the shortfall funding agreements. The $100 million capital contribution was financed by a combination of cash on hand, borrowings under LIN Television's revolving credit facility, and a new $60 million incremental term facility under LIN Television's existing senior secured credit facility. The JV Sale Transaction resulted in a $100 million charge recognized in the fourth quarter of 2012 to accrue for our obligations related to the JV Sale Transaction, and the recognition of taxable gains from the JV Sale Transaction resulting in a $163 million short-term deferred federal and state tax liability. Also on February 12, 2013, we announced that we entered into an Agreement and Plan of Merger with LIN LLC, a newly formed Delaware limited liability company and wholly owned subsidiary of LIN TV. For further information, see Item 1. "Business—Joint Venture Sale Transaction," Note 1—"Basis of Presentation and Summary of Significant Accounting Policies," and Note 15—"Commitments and Contingencies" to our consolidated financial statements.

    On October 12, 2012, we completed the acquisition of television stations in eight markets that were previously owned by affiliates of New Vision for $334.9 million, subject to certain post-closing adjustments, and including the assumption of $14.3 million of finance lease obligations. New Vision television stations accounted for approximately $40.0 million of our net revenues as of December 31, 2012. Additionally, on October 12, 2012, Vaughan, a third-party licensee, completed its acquisition of separately owned television stations in three markets for $4.6 million from PBC. We provide certain services to the television stations acquired by Vaughan pursuant to shared services and joint sales arrangements with Vaughan.

    On December 10, 2012, we acquired certain assets of KWBQ-TV, in Santa Fe, New Mexico, KRWB-TV, in Roswell, New Mexico, and KASY-TV, Albuquerque, New Mexico from ACME for approximately $17.3 million, and KASY-TV Licensee, LLC ("KASY"), a third-party licensee, acquired the remaining assets of these television stations for $1.7 million. We provide certain services to the television stations acquired by KASY pursuant to a shared services agreement with KASY.

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    On February 16, 2012, we completed the sale of substantially all of the assets of WWHO-TV in Columbus, OH to Manhan Media, Inc. On April 21, 2012, we completed the sale of substantially all of the assets of WUPW-TV in Toledo, OH to WUPW, LLC. For further information see Note 3—"Discontinued Operations" to our consolidated financial statements.

    On January 20, 2012, we completed the redemption of $251 million, net of a discount of $1.2 million, of our 61/2% Senior Subordinated Notes and our 61/2% Senior Subordinated Notes—Class B ("61/2% Senior Subordinated Notes"), and as of that date, there were no 61/2% Senior Subordinated Notes outstanding. We used proceeds from an incremental term loan under our senior secured credit facility and cash on hand to fund the aggregate redemption price.

    On October 12, 2012, we completed the issuance and sale of $290 million in aggregate principal amount of our 63/8% Senior Notes due 2021 (the "63/8% Senior Notes"). The net proceeds of the 63/8% Senior Notes were used to fund a portion of the purchase price for the acquisition of television stations from New Vision as further described above. Additionally, on October 12, 2012, Vaughan entered into a five-year term loan with an unrelated third party in a principal amount of approximately $4.6 million to fund the purchase price for the television stations from PBC that were acquired by Vaughan. We fully and unconditionally guarantee this loan. For further information see Note 7—"Long-term debt" to our consolidated financial statements.

    On December 24, 2012, we entered into an amendment to our Credit Agreement, which (1) replaced our $257.4 million tranche B term loan maturing in December 2018 with a new tranche B term loan of the same maturity which bears interest at a reduced rate, at our option, equal to an adjusted LIBOR rate plus 3.00%, or an adjusted Base Rate plus 2.00%, (2) made certain other changes to the Credit Agreement, including changes to the financial covenants therein that are favorable to us and our affiliates, and (3) extended the maturity for a $60 million tranche of our revolving credit facility to October 2017.

Critical Accounting Policies, Estimates and Recently Issued Accounting Pronouncements

        Certain of our accounting policies, as well as estimates we make, are critical to the presentation of our financial condition and results of operations since they are particularly sensitive to our judgment. Some of these policies and estimates relate to matters that are inherently uncertain. The estimates and judgments we make affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent liabilities. On an on-going basis, we evaluate our estimates, including those used for allowance for doubtful accounts in receivables, valuation of goodwill and intangible assets, amortization and impairment of program rights and intangible assets, stock-based compensation and other long-term incentive compensation arrangements, pension costs, barter transactions, income taxes, employee medical insurance claims, useful lives of property and equipment, contingencies, litigation and net assets of businesses acquired. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions, and it is possible that such differences could have a material impact on our consolidated financial statements.

        We believe the following critical accounting policies are those that are most important to the presentation of our consolidated financial statements, affect our more significant estimates and assumptions, and require the most subjective or complex judgments by management. We have discussed each of these critical accounting policies and related estimates with the Audit Committee of our Board of Directors. For additional information about these and other accounting policies, see Note 1—"Basis of Presentation and Summary of Significant Accounting Policies" to our consolidated financial statements included elsewhere in this report.

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Valuation of long-lived assets and intangible assets

        Approximately $725.7 million, or 58.4%, of our total assets as of December 31, 2012 consisted of indefinite-lived intangible assets. Intangible assets principally include broadcast licenses and goodwill. If the fair value of these assets is less than the carrying value, we may be required to record an impairment charge.

        We test the impairment of our broadcast licenses annually or whenever events or changes in circumstances indicate that such assets might be impaired. The impairment test consists of a comparison of the fair value of broadcast licenses with their carrying amount on a station-by-station basis using a discounted cash flow valuation method, assuming a hypothetical startup scenario. The future value of our broadcast licenses could be significantly impaired by the loss of the corresponding network affiliation agreements. Accordingly, such an event could trigger an assessment of the carrying value of a broadcast license.

        We test the impairment of our goodwill annually or whenever events or changes in circumstances indicate that goodwill might be impaired. Our reporting units are comprised of the markets in which our TV stations operate, LIN Digital and Nami Media. The first step of the goodwill impairment test compares the fair value of a reporting unit with its carrying amount, including goodwill. The fair value of a reporting unit is determined through the use of a discounted cash flow analysis. The valuation assumptions used in the discounted cash flow model reflect historical performance of the reporting unit and prevailing rates in the markets for broadcasters. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not considered impaired. If the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of goodwill with the carrying amount of that goodwill. The implied fair value of goodwill is determined by performing a hypothetical purchase price allocation, using the reporting unit's fair value (as determined in the first step described above) as the purchase price. If the carrying amount of goodwill exceeds the implied fair value, an impairment charge is recognized in an amount equal to that excess, but not more than the carrying value of the goodwill. An impairment assessment could be triggered by a significant reduction, or a forecast of such reductions, in operating results or cash flows at one or more of our reporting units, a significant adverse change in the national or local advertising marketplaces in which our television stations operate, or by adverse changes to FCC ownership rules, among other factors.

        The assumptions used in the valuation testing have certain subjective components including anticipated future operating results and cash flows based on our own internal business plans as well as future expectations about general economic and local market conditions. The changes in the discount rate used for our broadcast licenses and goodwill reflected in the table below are primarily driven by changes in the average beta for the public equity of companies in the television and media sector and the average cost of capital in each of the periods. The changes in the market growth rates and operating profit margins for both our broadcast licenses and goodwill reflect changes in the outlook for advertising revenues in certain markets where our stations operate in each of the periods.

        We based the valuation of broadcast licenses on the following average industry-based assumptions:

 
  December 31,
2012
  December 31,
2011
  December 31,
2010
 

Market revenue growth

    0.87 %   1.2 %   0.9 %

Operating cash flow margins

    30.9 %   30.6 %   30.5 %

Discount rate

    10.5 %   10.5 %   10.5 %

Tax rate

    38.3 %   38.3 %   38.3 %

Long-term growth rate

    1.8 %   1.8 %   1.8 %

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        As of December 31, 2012, we would not incur an impairment charge if we were to decrease the market revenue growth rate by 1% and 2%, respectively. A 5% and 10% decrease in operating profit margins would result in an impairment charge of $0 million and $18.7 million, respectively. An increase of 1% and 2% in the discount rate would not result in an impairment charge.

        The valuation of goodwill is based on the following assumptions, which take into account our internal projections and industry assumptions related to market revenue growth, operating cash flows and prevailing discount rates:

 
  December 31,
2012
  December 31,
2011
  December 31,
2010
 

Market revenue growth

    1.2 %   1.8 %   1.0 %

Operating cash flow margins

    48.2 %   42.3 %   39.9 %

Discount rate

    12.0 %   12.0 %   12.0 %

Tax rate

    38.4 %   38.4 %   38.4 %

Long-term growth rate

    1.8 %   1.8 %   1.9 %

        As of December 31, 2012, if we were to decrease the market revenue growth by 1% and 2% of the projected growth rate, the enterprise value of our stations with goodwill would decrease by $152.9 million and $280.8 million, respectively. If we were to decrease the operating profit margins by 5% and 10% from the projected operating profit margins, the enterprise value of our stations with goodwill would decrease by $224.2 million and $447 million, respectively. If we were to increase the discount rate used in the valuation calculation by 1% and 2%, the enterprise value of our stations with goodwill would decrease by $203.2 million and $370.4 million, respectively.

Network affiliations

        Other broadcast companies may use different assumptions in valuing acquired broadcast licenses and their related network affiliations than those that we use. These different assumptions may result in the use of valuation methods that can result in significant variances in the amount of purchase price allocated to these assets by these broadcast companies.

        We believe that the value of a television station is derived primarily from the attributes of its broadcast license. These attributes have a significant impact on the audience for network programming in a local television market compared to the national viewing patterns of the same network programming. These attributes and their impact on audiences can include:

    the scarcity of broadcast licenses assigned by the FCC to a particular market determines how many television networks and other program sources are viewed in a particular market;

    the length of time the broadcast license has been broadcasting. Television stations that have been broadcasting since the late 1940s are viewed more often than newer television stations;

    the quality of the broadcast signal and location of the broadcast station within a market (i.e. the value of being licensed in the smallest city within a tri-city market has less value than being licensed in the largest city);

    the audience acceptance of the local news programming and community involvement of the local television station. The local television station's news programming that attracts the largest audience in a market generally will provide a larger audience for its network programming; and

    the quality of the other non-network programming carried by the television station. A local television station's syndicated programming that attracts the largest audience in a market generally will provide larger audience lead-ins to its network programming.

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        A local television station can be the top-rated station in a market, regardless of the national ranking of its affiliated network, depending on the factors or attributes listed above. ABC, CBS, FOX and NBC, each have affiliations with local television stations that have the largest primetime audience in the local market in which the station operates regardless of the network's primetime rating.

        Some broadcasting companies believe that network affiliations are the most important component of the value of a station. These companies generally believe that television stations with network affiliations have the most successful local news programming and the network affiliation relationship enhances the audience for local syndicated programming. As a result, these broadcasting companies allocate a significant portion of the purchase price for any station that they may acquire to the network affiliation relationship.

        We generally have acquired broadcast licenses in markets with a number of commercial television stations equal to or less than the number of television networks seeking affiliates. The methodology we used in connection with the valuation of the stations acquired is based on our evaluation of the broadcast licenses and the characteristics of the markets in which they operated. We believed that in substantially all our markets we would be able to replace a network affiliation agreement with little or no economic loss to our television station. As a result of this assumption, we ascribed no incremental value to the incumbent network affiliation in substantially all our markets in which we operate beyond the cost of negotiating a new agreement with another network and the value of any terms that were more favorable or unfavorable than those generally prevailing in the market. Other broadcasting companies have valued network affiliations on the basis that it is the affiliation and not the other attributes of the station, including its broadcast license, which contributes to the operating performance of that station. As a result, we believe that these broadcasting companies include in their network affiliation valuation amounts related to attributes that we believe are more appropriately reflected in the value of the broadcast license or goodwill.

        In future acquisitions, the valuation of the broadcast licenses and network affiliations may differ from those attributable to our existing stations due to different facts and circumstances for each station and market being evaluated.

Valuation allowance for deferred tax assets

        We consider future taxable income and feasible tax planning strategies in assessing the need for establishing or removing a valuation allowance. We record or subsequently remove a valuation allowance to reflect our deferred tax assets to an amount that is more likely than not to be realized.

        In the event that our determination changes regarding the realization of all or part of our deferred tax assets in the future, an adjustment to the deferred tax asset is recorded to our consolidated statement of operations in the period in which such a determination is made.

Revenue recognition

        We recognize local, national and political advertising sales, net of agency commissions, during the period in which the advertisements or programs are aired on our television stations, and when payment is reasonably assured. Internet and mobile advertisement sales are recognized when the advertisement is displayed on our web sites or the web sites of our advertising network. We recognize retransmission consent fees in the period in which our service is delivered.

Stock-based compensation

        We estimate the fair value of stock option awards using a Black-Scholes valuation model. The Black-Scholes model requires us to make assumptions and judgments about the variables used in the calculation, including the option's expected term, the price volatility of the underlying stock and the number of stock

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option awards that are expected to be forfeited. The expected term represents the weighted-average period of time that options granted are expected to be outstanding giving consideration to vesting schedules and our historical exercise patterns. Expected volatility is based on historical trends for our class A common stock over the expected term, and prior to 2010, we used the historical trends of our class A common stock over the expected term, as well as a comparison to peer companies. Expected forfeitures are estimated using our historical experience. If future changes in estimates differ significantly from our current estimates, our future stock-based compensation expense and results of operations could be materially impacted.

Retirement plan

        We have historically provided a defined benefit retirement plan to our employees who did not receive matching contributions from our Company to their 401(k) Plan accounts. Our pension benefit obligations and related costs are calculated using actuarial concepts. Our defined benefit plan is a non-contributory plan under which we made contributions either to: a) traditional plan participants based on periodic actuarial valuations, which are expensed over the expected average remaining service lives of current employees; or b) cash balance plan participants based on 5% of each participant's eligible compensation. Effective April 1, 2009, this plan was frozen and we do not expect to make additional benefit accruals to this plan, however we continue to fund our existing vested obligations.

        We contributed $7.4 million, $5.4 million and $5.4 million to our pension plan during the years ended December 31, 2012, 2011 and 2010, respectively. We anticipate contributing $5.4 million to our pension plan in 2013.

        Weighted-average assumptions used to estimate our pension benefit obligations and to determine our net periodic pension benefit cost are as follows:

 
  Year Ended December 31,
 
  2012   2011   2010

Discount rate used to estimate our pension benefit obligation

  3.60% - 4.00%   3.90% - 4.20%   5.25%

Discount rate used to determine net periodic pension benefit cost

  3.90% - 4.20%   5.25%   5.75%

Rate of compensation increase

  N/A   N/A   N/A

Expected long-term rate-of-return on plan assets

  7.00%   7.00%   8.00%

        The discount rate for the year ended December 31, 2012 was determined using a custom bond modeler that develops a hypothetical portfolio of high quality corporate bonds, rated AA- and above by Standard & Poor's, that could be purchased to settle the obligations of the plan. The yield on this hypothetical portfolio represents a reasonable rate to value our plan liability. Prior to 2011, we used the Citigroup Pension Discount Curve to aid in the selection of our discount rate, which we believe reflects the weighted rate of a theoretical high quality bond portfolio consistent with the duration of the cash flows related to our pension liability.

        We considered the current levels of expected returns on a risk-free investment, the historical levels of risk premium associated with each of our pension asset classes, the expected future returns for each of our pension asset classes and then weighted each asset class based on our pension plan asset allocation to derive an expected long-term return on pension plan assets. During the year ended December 31, 2012, our actual rate of return on plan assets was 15.4%.

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        As a result of the plan freeze during 2009, we have no further service cost or amortization of prior service cost related to the plan. In addition, because the plan is now frozen and participants became inactive during 2009, the net losses related to the plan included in accumulated other comprehensive income are now amortized over the average remaining life expectancy of the inactive participants instead of the average remaining service period. We expect to record a pension expense of approximately $0.3 million in 2013. For every 0.25% change in the actual return compared to the expected long-term return on pension plan assets and for every 0.25% change in the actual discount rate compared to the discount rate assumption for 2013, our 2013 pension expense would change by less than $0.1 million, respectively.

        Our investment objective is to achieve a consistent total rate-of-return that will equal or exceed our actuarial assumptions and to equal or exceed the benchmarks that we use for each of our pension plan asset classes. The following asset allocation is designed to create a diversified portfolio of pension plan assets that is consistent with our target asset allocation and risk policy:

 
  Target
Allocation
  Percentage
of Plan
Assets as of
December 31,
 
Asset Category
  2012   2012   2011  

Equity securities

    60 %   55 %   60 %

Debt securities

    40 %   45 %   40 %
               

    100 %   100 %   100 %
               

Recently issued accounting pronouncements

        For a discussion of new accounting standards please read Note 1, "Basis of Presentation and Summary of Significant Accounting Policies" to our consolidated financial statements included in this report.

Results of Operations

        Set forth below are the key operating areas that contributed to our results for the years ended December 31, 2012, 2011 and 2010. Our consolidated financial statements reflect the operations of WWHO-TV, in Columbus, OH and WUPW-TV in Toledo, OH as discontinued for all periods presented. As a result, reported financial results may not be comparable to certain historical financial information.

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        Our results of operations are as follows (in thousands):

 
  Year Ended December 31,    
   
   
   
 
 
  2012   2011   2010   2012 vs. 2011   2011 vs. 2010  

Local revenues

  $ 316,471   $ 255,478   $ 237,744   $ 60,993     24 % $ 17,734     7 %

National advertising sales

    107,325     95,734     98,915     11,591     12 %   (3,181 )   (3 )%

Political advertising sales

    76,458     8,132     41,619     68,326     840 %   (33,487 )   (80 )%

Interactive revenues

    41,095     27,220     16,443     13,875     51 %   10,777     66 %

Other revenues

    12,113     13,439     13,469     (1,326 )   (10 )%   (30 )   0 %
                               

Net revenues

    553,462     400,003     408,190     153,459     38 %   (8,187 )   (2 )%

Operating expenses:

                                           

Direct operating

    160,222     130,618     119,159     29,604     23 %   11,459     10 %

Selling, general and administrative

    125,267     103,770     102,063     21,497     21 %   1,707     2 %

Amortization of program rights

    23,048     21,406     22,719     1,642     8 %   (1,313 )   (6 )%

Corporate

    34,246     26,481     23,943     7,765     29 %   2,538     11 %

Depreciation

    32,149     26,246     27,013     5,903     22 %   (767 )   (3 )%

Amortization of intangible assets

    6,364     1,199     1,549     5,165     431 %   (350 )   (23 )%

Restructuring

    1,009     707     3,136     302     43 %   (2,429 )   (77 )%

Loss (gain) from asset dispositions

    96     472     (3,231 )   (376 )   (80 )%   3,703     (115 )%
                               

Total operating costs

    382,401     310,899     296,351     71,502     23 %   14,548     5 %
                               

Operating income

  $ 171,061   $ 89,104   $ 111,839   $ 81,957     92 % $ (22,735 )   (20 )%
                               

Three-Year Comparison

        Net revenues consist primarily of local, national, and political advertising sales, net of sales adjustments and agency commissions. Additional revenues are generated from advertising on our television station web sites, retransmission consent fees, interactive revenues, barter revenues, network compensation, production revenues, tower rental income and station copyright royalties.

        Net revenues during the year ended December 31, 2012 increased by $153.5 million when compared with the prior year. The increase was primarily due to: (i) a $68.3 million increase in political advertising sales; (ii) a $61 million increase in local revenues; (iii) a $13.9 million increase in interactive revenues, which include revenues from LIN Digital and Nami Media primarily as a result of a growth in customer base and new product offerings; and (iv) a $11.6 million increase in national advertising sales. Net revenues for the year ending December 31, 2012 include $40.5 million that is attributable to television stations acquired during the fourth quarter of 2012.

        Historically, our revenues related to political advertising are stronger during federal election years, typically years ending in an even number. In addition to federal elections, most state and local elections also occur on the same election cycle. Consequently, political advertising sales during the years ended December 31, 2012 and 2010 were higher than political advertising sales during the year ended December 31, 2011. We expect this trend of stronger political advertising sales during election years to continue in the future.

        The automotive category, which represented 26% of our local and national advertising sales during the year ended December 31, 2012, was up 15% as compared to 2011, during which the automotive category represented 24% of our local and national advertising sales.

        Net revenues during the year ended December 31, 2011 decreased by $8.2 million when compared with the prior year. The decrease was primarily due to: (i) a $33.5 million decrease in political advertising

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sales; and (ii) a $3.2 million decrease in national advertising sales. These decreases were partially offset by: (i) a $17.7 million increase in local revenues; and (ii) a $10.8 million increase in digital revenues.

        The decrease in national advertising sales during 2011 was primarily due to the impact on advertising revenue of the 2011 Japan earthquake and tsunami. The increase in local revenues during 2011 was primarily due to growth in local advertising sales, growth in retransmission consent revenues, primarily as a result of contractual rate increases, and increased advertising on our television station web sites. The increase in digital revenues for the year ended December 31, 2011, compared to the same period last year was a result of growth in Internet advertising revenues primarily from increased advertising sales from LIN Digital.

        The automotive category, which represented 24% of our local and national advertising sales during the year ended December 31, 2011 was essentially flat as compared to 2010, during which the automotive category represented 23% of our local and national advertising sales.

        Direct operating expenses (excluding depreciation and amortization of intangible assets), which consist primarily of news, engineering, and programming expenses, increased $29.6 million, or 23%, for the year ended December 31, 2012, compared to the prior year. This increase is primarily the result of an increase in fees relating to network affiliation agreements, growth in employee compensation expense, and higher cost of goods sold associated with LIN Digital.

        Our direct operating expenses for the year ending December 31, 2012 includes $9.4 million that is attributable to television stations acquired during the fourth quarter of 2012.

        Direct operating expenses increased $11.5 million or 10% for the year ended December 31, 2011, compared to the prior year, primarily due to higher cost of goods sold associated with interactive revenues, and an increase in fees pursuant to network affiliation agreements.

        Selling, general and administrative expenses consist primarily of employee salaries, sales commissions, employee benefit costs, advertising, promotional expenses and research. These costs increased $21.5 million, or 21%, for the year ended December 31, 2012, compared to the prior year. The increase was primarily due to higher variable costs attributable to the growth in revenue compared to the prior year.

        Our selling, general and administrative expenses for the year ending December 31, 2012 includes $9.7 million that is attributable to television stations acquired during the fourth quarter of 2012.

        Selling, general and administrative expenses increased $1.7 million, or 2%, for the year ended December 31, 2011, compared to the prior year. The increase was primarily due to an increase in sales compensation as a result of growth in our digital revenues. Additionally, the increase was due in part to a benefit from a litigation settlement that occurred during the year ended December 31, 2010 that did not recur during 2011.

        Selling expenses as a percentage of net revenues were 6.6%, 7.4% and 7.3% for the years ended December 31, 2012, 2011 and 2010, respectively.

        Amortization of program rights represents the recognition of expense associated with syndicated programming, features and specials, and these costs increased $1.6 million, or 8%, for the year ended December 31, 2012 and decreased $1.3 million, or 6%, for the year ended December 31, 2011, compared to their respective prior years. The increase in 2012 compared to 2011 was attributable to the amortization of programming rights associated with the television stations acquired during the fourth quarter of 2012. The decrease in 2011 compared to 2010 was primarily attributable to a decrease in the cost of syndicated programming.

        Corporate expenses represent corporate executive management, accounting, legal and other costs associated with the centralized management of our stations, and these costs increased $7.8 million, or 29%,

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for the year ended December 31, 2012, compared to the prior year. The increase was primarily due to increases in employee compensation and acquisition related expenses compared to prior year.

        Corporate expenses increased $2.5 million, or 11%, for the year ended December 31, 2011, compared to the prior year. The increase was primarily due to increases in legal and professional fees, and stock-based compensation.

        Depreciation expense increased $5.9 million, or 22%, for the year ended December 31, 2012 and decreased $0.8 million, or 3%, for the year ended December 31, 2011, compared to their respective prior years. The increase in 2012 was primarily attributable to the property and equipment associated with our acquisitions of television stations in the fourth quarter of 2012. The decreases during 2012 and 2011 were due to assets that have been fully depreciated compared to the prior year.

        Amortization of intangible assets increased $5.2 million, or 431%, for the year ended December 31, 2012, compared to the prior year. The increase was primarily attributable to the increase in amortizable intangible assets from our television stations acquired in the fourth quarter of 2012.

        Amortization of intangible assets decreased $0.4 million, or 23%, for the year ended December 31, 2011, compared to the prior year. The decrease was due to certain intangible assets acquired in the RMM acquisition that have been fully amortized compared to the prior year.

        Impairment of goodwill and broadcast licenses related to discontinued operations in the amount of $1.6 million were recorded during the year ended December 31, 2011. For further information, see Note 6—"Intangible Assets" to our consolidated financial statements.

        Restructuring charges of $1.0 million, $0.7 million and, $3.3 million were recorded during the years ended December 31, 2012, 2011 and 2010, respectively, as a result of the consolidation of certain activities at our stations and our corporate headquarters.

        Loss from asset dispositions for the years ended December 31, 2012 and 2011 was $0.1 million and $0.5 million, respectively. These losses were primarily attributable to losses on the disposal of fixed assets.

        Gain from asset dispositions for the year ended December 31, 2010 was $3.2 million. The gain was primarily attributable to a gain on the exchange of certain equipment with Sprint Nextel of $3.7 million, which was partially offset by a loss on the disposal of fixed assets.

Other Expense

 
  Year Ended December 31,  
 
  2012   2011   2010  

Components of other expense:

                   

Interest expense, net

  $ 46,683   $ 50,706   $ 51,525  

Share of loss in equity investments

    98,309     4,957     169  

(Gain) loss on derivative instruments

        (1,960 )   1,898  

Loss on extinguishment of debt

    3,341     1,694     2,749  

Other expense (income), net

    237     51     (728 )
               

Total other expense, net

  $ 148,570   $ 55,448   $ 55,613  
               

        Interest expense, net decreased $4.0 million, or 8%, for the year ended December 31, 2012, compared to the prior year primarily as a result of the redemption of our 61/2% Senior Subordinated Notes during the first quarter of 2012. This decrease was partially offset by an increase in borrowings under our senior secured credit facility compared to the same period last year as well as new debt issued in connection with the acquisition of the New Vision stations.

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        Interest expense, net decreased $0.8 million, or 2%, for the year ended December 31, 2011, compared to the prior year primarily due to reductions in interest expense on borrowings under our 2009 senior secured credit facility as a result of a reduction of balances outstanding under the facility during the year. This decrease was partially offset by an increase in interest expense related to our 83/8% Senior Notes due 2015 (the "83/8% Senior Notes" and together with the 63/8% Senior Notes, the "Senior Notes"). The following table summarizes our total interest expense, net (in thousands):

 
  Year Ended December 31,  
 
  2012   2011   2010  

Components of interest expense:

                   

Senior secured credit facility

  $ 19,651   $ 2,389   $ 5,618  

83/8% Senior Notes

    17,389     17,389     12,321  

63/8% Senior Notes

    4,401          

61/2% Senior Subordinated Notes

    595     18,002     18,655  

61/2% Senior Subordinated Notes—Class B

    306     10,505     11,015  

Other interest costs

    4,341     2,421     3,916  
               

Total interest expense, net

  $ 46,683   $ 50,706   $ 51,525  
               

        Share of loss in equity investments increased $93.4 million as compared to the prior year primarily due to a $100 million accrual recorded in 2012 related to the capital contribution made to SVH in connection with the JV Sale Transaction and corresponding release from the GECC Guarantee. That accrual was partially offset by the reversal of accrued shortfall funding liabilities that were extinguished pursuant to the terms of the JV Sale Agreement, as further described in Item 1. "Business—Joint Venture Sale Transaction" and in Note 15—"Commitments and Contingencies" to our consolidated financial statements.

        (Gain) loss on derivative instruments was $0 million, $(2.0) million, and $1.9 million for the years ended December 31, 2012, 2011, and 2010, respectively. During 2011, and 2010, our derivative instrument consisted of an interest rate hedge agreement entered into during the second quarter of 2006 (the "2006 interest rate hedge") to hedge the variability in cash flows associated with a notional amount of the declining balances of our term loans under our 2009 senior secured credit facility. The 2006 interest rate hedge expired on November 4, 2011. Consequently, there is no impact to our statement of operations for the year ended December 31, 2012.

        The 2006 interest rate hedge effectively converted the floating rate LIBOR-based payments under this portion of the facility to fixed payments; however the hedge ceased to be highly effective during 2010 as a result of the $45.9 million repayment of principal on our terms loans, as described further in Note 8—"Derivative Financial Instruments" to our consolidated financial statements. Accordingly, the portion of the fair value recognized in accumulated other comprehensive loss, $3.6 million, was recorded as a charge to our consolidated statement of operations during the year ended December 31, 2010, and all changes in fair value have since been recorded in our consolidated statement of operations. The gain of $(2.0) million for the year ended December 31, 2011 was due to fluctuations in market interest rates. The loss of $1.9 million for the year ended December 31, 2010 was due to fluctuations in market interest rates and the $3.6 million charge from accumulated other comprehensive income.

        Loss on extinguishment of debt was $3.3 million, $1.7 million and $2.7 million for the years ended December 31, 2012, 2011 and 2010, respectively. The loss on extinguishment of debt during the year ended December 31, 2012 was primarily a result of the redemption of our 61/2% Senior Subordinated Notes during January 2012, and the December 2012 amendment to our existing $75 million revolving credit loans. The loss on extinguishment of debt during the years ended December 31, 2011 and 2010 included a write down of deferred financing fees as a result of the payment of principal on our revolving credit facility and term loans as further described in "Description of Indebtedness". Additionally, the loss on extinguishment of debt during the year ended December 31, 2011, included a write-down of deferred financing fees and

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unamortized discount due to the redemption of $109.1 million of our 61/2% Senior Subordinated Notes, and $55.9 million of our 61/2% Senior Subordinated Notes—Class B as further described in "Liquidity and Capital Resources".

        Income taxes reflected a provision for (benefit from) income tax of $40.5 million, ($16.0) million and $20.0 million for the years ended December 31, 2012, 2011, and 2010, respectively. Our effective tax rate on pre-tax income was 179.9%, (47.7)% and 35.7% for the years ended December 31, 2012, 2011 and 2010, respectively.

        Our effective tax rate fluctuates from year to year. The factors that most impact our effective tax rate are changes to our valuation allowance, changes in tax laws, allocation of income to the various state jurisdictions in which we operate, and acquisition and divestiture transactions, including the JV Sale Transaction.

        Our effective tax rate for the year ended December 31, 2012 increased from 2011, primarily due to the recognition of a $28.4 million discrete income tax expense related to the recognition of a taxable gain associated with the JV Sale Transaction, as further described in Item 1. "Business—Joint Venture Sale Transaction".

        The 2011 tax benefit is primarily a result of the 2011 reversal of $35.1 million of our federal valuation allowance relating to 1999 to 2002 net operating losses, and the 2011 reversal of $1.0 million of our state valuation allowance relating to 2002 to 2010 net operating losses. These valuation allowances were reversed primarily due to our recent history of taxable income, and our projected ability to generate sufficient taxable income prior to the expiration of those net operating loss carryforwards. Upon the reversal of the federal and state valuation allowances, as of December 31, 2011, we had a remaining valuation allowance of $23.4 million placed against our deferred tax assets primarily related to state net operating loss carryforwards.

        The combined 2011 $36.1 million income tax benefit described above was offset in part by a $5.1 million discrete deferred income tax expense recognized in the second quarter of 2011, which resulted from state tax legislation enacted in Michigan in May 2011, which repealed the Michigan business tax ("MBT"), and implemented a corporate income tax instead, effective January 2012. As a result of the elimination of the MBT, certain future tax deductions that were available to be utilized beginning in 2015, and had been recognized as deferred tax assets in our financial statements, were no longer deductible. Therefore, during the year ended December 31, 2011, we recognized incremental deferred income tax expense of $5.1 million, net of federal benefit, for the reversal of these previously established deferred tax assets.

        Our effective tax rate for the year ended December 31, 2010 was positively impacted by a $1.2 million income tax benefit from the reversal of our valuation allowance.

Results of Discontinued Operations

        Our consolidated financial statements reflect the operations, assets and liabilities of WWHO-TV in Columbus, OH and WUPW-TV in Toledo, OH, as discontinued for all periods presented. The sale of WWHO-TV in Columbus, OH was completed on February 16, 2012. The sale of WUPW-TV in Toledo, OH was completed on April 21, 2012. As a result, (loss) income from discontinued operations was ($1.0) million, ($0.9) million and $0.3 million for the years ended December 31, 2012, 2011 and 2010, respectively. For further information see Note 3—"Discontinued Operations" to our consolidated financial statements.

Liquidity and Capital Resources

        Our liquidity position depends on our ability to generate cash from operations and to utilize borrowings under our senior secured credit facility and/or obtain financing from other sources. Our ability

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to make use of the revolving credit facility and to access the capital markets is contingent on our compliance with certain financial covenants, which are measured, in part, by the level of EBITDA we generate from our operations. As of December 31, 2012, we were in compliance with all financial and non-financial covenants under our senior secured credit facility. As of December 31, 2012, we had unrestricted cash and cash equivalents of $46.3 million, and a $75 million revolving credit facility, of which $75 and $70 million were available as of December 31, 2012 and as of the date of this report, respectively.

Joint Venture Sale Transaction

        On February 12, 2013, we, along with our wholly-owned subsidiaries LIN Television and LIN Texas entered into and closed the JV Transaction Agreement with Comcast Corporation, affiliates of NBCUniversal, the GE Parties and SVH, a joint venture with NBCUniversal. SVH holds a 99.75% interest in Station Venture Operations, LP ("SVO"), which is the operating company that manages KXAS-TV and KNSD-TV, the television stations that comprise the joint venture. The JV Transaction Agreement effected a series of transactions whereby (i) in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations related to any shortfall funding agreements. (ii) LIN Television transferred its right to prior unsecured shortfall fundings made to SVH and, (iii) LIN Texas sold its 20.38% equity interest in SVH for $1.00, all of which are described further in Note 4—"Investments" (collectively, the "JV Sale Transaction").

        As a result, as of December 31, 2012 we accrued for the $100 million payment to SVH to secure the release of the guarantee and accounted for the related income tax consequences. As noted in Note 18—"Subsequent Events" to our consolidated financial statements, in February 2013, we issued $60 million of new debt, and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million payment. As a result of the JV Sale Transaction, LIN TV, after utilizing all of its available Federal NOL carryforwards to offset the taxable gain recognized in such transaction, has an approximate $163 million short-term deferred federal and state tax liability remaining associated with the JV Sale Transaction as of December 31, 2012. Management's plans with regard to the $163 million tax liability are presented below.

        Concurrent with the closing of the JV Sale Transaction, we also entered into an Agreement and Plan of Merger (the "Merger Agreement") with LIN LLC to effect the Merger. The Merger, which is subject to shareholder approval (among other closing conditions), is expected to enable LIN LLC to be classified as a partnership for federal income tax purposes, and such change in classification would be treated as a liquidation of LIN TV for federal income tax purposes with the result that LIN TV would recognize a gain or loss, as applicable, in its 100% equity interest in LIN Television. As a result, LIN TV is expected to realize a capital loss between its tax basis in the stock of its subsidiary, LIN Television, and the fair market value of this stock at the closing of this transaction.

        In the event that LIN TV does not complete the Merger for any reason, or if the Merger does not generate a capital loss sufficient to offset fully the capital gain from the JV Sale Transaction, due to LIN TV's stock price at the time of the Merger, LIN TV could incur cash income taxes of up to $163 million related to the JV Sale Transaction, payable beginning in 2013. If necessary, we would seek to fund the current federal and state tax liabilities, and any interest and penalties for late payment of taxes, through cash generated from operations, amounts available under our revolving credit facility, and additional borrowings. There can be no assurance that any such funds, including additional borrowings, will be available on acceptable terms or at all. Should additional borrowings be unavailable, we may defer payment of such tax liabilities into 2014 and incur late payment interest and penalties, and we believe that there may be cost and capital expenditure reduction initiatives available in 2013 and 2014 that, based on our current forecast of operating results, would allow us to generate sufficient cash flows to fund our operations, pay the tax liability and related penalties described above in 2014, and maintain compliance with the financial covenants under our debt obligations into 2014.

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        We estimate that the cash transaction costs of completing the JV Sale Transaction and the Merger will be $5 - $7 million during 2013.

        Below is a discussion of other significant sources and uses of cash and should be read in conjunction with our consolidated statements of cash flows.

Operating activities

        Cash provided by operating activities is primarily driven by our net revenues and changes in working capital as a result of the timing of collections and payments. Our total net revenues has primarily been, and will primarily be affected by, among other things, the following:

    Continued growth in local and interactive revenues.  During the years ended December 31, 2012 and 2011, our local revenues, which include net local advertising sales, retransmission consent fees and revenues from our television station web sites and mobile applications, increased 24% and 7%, respectively, compared to the prior year. Additionally, during the years ended December 31, 2012 and 2011, our interactive revenues increased 51% and 66%, respectively, which are generated by LIN Digital, our online advertising and media services business, and Nami Media. We expect further growth in our local revenues and digital revenues, however, there can be no assurance that this will occur.

    Cyclical fluctuations.  We experience significant fluctuations in our political advertising revenues since advertising revenues are generally higher in even-numbered years due to additional revenues associated with political advertising related to local and national elections. Political advertising revenues were $76.5 million, $8.1 million, and $41.6 million for the years ended December 31, 2012, 2011, and 2010, respectively. We also experience incremental advertising revenues associated with Olympic broadcasts during even-numbered years. We experienced a significant increase in advertising revenues during 2012, and expect a significant decrease in advertising revenues during 2013, as a result of these cyclical fluctuations.

    Cash requirements related to the acquisition of RMM.  In connection with our acquisition of RMM (now LIN Digital), we entered into an incentive compensation arrangement with certain key members of management that provides payments to those employees based on a computation of EBITDA generated by LIN Digital during 2012. Based on that computation, as of December 31, 2012, we have recognized a current liability of $8.9 million related to this incentive compensation arrangement, and expect to pay that amount during the first quarter of 2013.

    Employee benefit contributions.  Our employee benefit plan contributions include contributions to our pension plan and our 401(k) Plan. Volatility in the equity markets impacts the fair value of our pension plan assets and ultimately the cash funding requirements of our pension plan. We contributed $7.4 million, $5.4 million and $5.4 million to our pension plan during the years ended December 31, 2012, 2011 and 2010, respectively, and anticipate contributing $5.4 million to our pension plan during 2013. Effective January 1, 2010, we resumed contributions to our 401(k) Plan, whereby we provide a 3% non-elective contribution to all eligible employees. We contributed approximately $3.9 million, $3.6 million, and $3.5 million during the years ended December 31, 2012, 2011 and 2010, respectively, and expect to contribute approximately $5.4 million to our 401(k) Plan during 2013.

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    Payments related to certain restructuring activities.  We made cash payments related to certain restructuring initiatives of $2.2 million, $1.1 million and $2.4 million during the years ended December 31, 2012, 2011 and 2010, respectively. For further details on these restructuring initiatives see Note 13—"Restructuring" to our consolidated financial statements. In connection with the integration of the New Vision stations acquired during the fourth quarter of 2012, we expect to incur additional restructuring charges of approximately $2.5 - $3.5 million during 2013.

Investing activities

        Cash used in investing activities has primarily been, and will primarily be affected by, among other things, the following:

    Acquisition of television stations from New Vision.  On October 12, 2012, we completed the acquisition of television stations in eight markets from New Vision for $334.9 million, subject to certain post-closing adjustments, and including the assumption of $14.3 million of finance lease obligations. Pursuant to the terms of our purchase agreement with New Vision, $33.5 million of the purchase price at closing was funded from amounts previously deposited into escrow. The remaining purchase price of $301.4 million was funded from cash on hand and the net proceeds of the issuance and sale of the 63/8% Senior Notes. Additionally, on October 12, 2012, Vaughan, a third-party licensee, completed its acquisition of separately owned television stations in three markets for $4.6 million from PBC. LIN Television fully and unconditionally guarantees this loan. For further information see Note 2—"Acquisitions" and Note 7—"Long-term debt" to our consolidated financial statements.

    Acquisition of broadcast assets from ACME.  On December 10, 2012, we acquired certain assets of KWBQ-TV, in Santa Fe, New Mexico, KRWB-TV, in Roswell, New Mexico, and KASY-TV, in Albuquerque, New Mexico from ACME for approximately $17.3 million, and KASY, a third-party licensee, acquired the remaining assets of these television stations for $1.7 million. LIN Television provides certain services to the television stations acquired by KASY pursuant to a shared services agreement with KASY. Upon closing of the acquisition, KASY entered into a five-year term loan with an unrelated third party in a principal amount of approximately $1.7 million to fund the purchase price for the television stations from ACME. LIN Television fully and unconditionally guarantees this loan. For further information see Note 2—"Acquisitions" and Note 7—"Long-term debt" to our consolidated financial statements.

    Capital expenditures.  Capital expenditures increased $8.1 million to $28.2 million, and increased $2.6 million to $20.1 million, for the years ended December 31, 2012 and 2011, respectively, compared to the prior years. We anticipate capital expenditures of approximately $31 - $35 million during the year ended December 31, 2013, which we expect to fund using cash flows from operations.

    Shortfall loans to the joint venture with NBCUniversal.  During the years ended December 31, 2012 and 2011, pursuant to the shortfall funding agreements, we made shortfall loans in an aggregate principal amount of $2.3 and $2.5 million, representing our approximate 20% share in debt service shortfalls. As of December 31, 2012, as a result of the JV Sale Transaction, we have no further shortfall funding liabilities.

    Sale of assets.  During 2012, we received net cash proceeds of $6.3 million and $23.2 million related to the divestiture of substantially all of the assets of WWHO-TV in Columbus, OH and WUPW-TV in Toledo, OH, respectively.

    Other Investments.  During the year ended December 31, 2011, we acquired a majority interest in Nami Media, a digital advertising management and technology company. Under the terms of the purchase agreement, we may be required to purchase the remaining outstanding shares of Nami

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      Media in 2014, with a purchase price based on multiples of Nami Media's 2013 net revenue and EBITDA as further described in Note 2—"Acquisitions" to our consolidated financial statements. Our maximum potential obligation under the Nami Media agreements is $37.4 million.

Financing activities

        Cash used in financing activities has primarily been, and will primarily be affected by, among other things, the following:

    Senior Secured Credit Facility.  On December 24, 2012, we entered into an amendment to our Credit Agreement which (1) replaced our $257.4 million tranche B term loan maturing in December 2018 with a new tranche B term loan of the same maturity which bears interest at a reduced rate, (2) made certain other changes to the Credit Agreement, including changes to the financial covenants therein that are favorable to LIN Television and its affiliates, and (3) extended the maturity for a $60.0 million tranche of our revolving credit facility to October 2017. We paid customary fees and expenses in connection with the closing of such amendment.

    Incremental Facility.  On February 12, 2013, we entered into a $60 million, 5 year incremental term loan pursuant to the Credit Agreement governing LIN Television's senior secured credit facility. The proceeds of the Incremental Facility, as well as cash on hand and cash from revolving borrowings, were used to fund the $100 million transferred to SVH in the JV Sale Transaction.

    63/8% Senior Notes.  On October 12, 2012, we completed the issuance and sale of $290 million in aggregate principal amount of the 63/8% Senior Notes. The net proceeds of the 63/8% Senior Notes were used to fund a portion of the purchase price for the acquisition of the New Vision stations. Additionally, on October 12, 2012, Vaughan entered into a five-year term loan with an unrelated third party in a principal amount of approximately $4.6 million to fund the purchase price for the television stations from PBC that were acquired by Vaughan. Vaughan subsequently made a principal payment of $1.3 million to the balance of the term loan. LIN Television fully and unconditionally guarantees this loan.

    Senior Subordinated Notes Due 2013.  During the year ended December 31, 2011, we redeemed $109.1 million of our 61/2% Senior Subordinated Notes, and $55.9 million of our 61/2% Senior Subordinated Notes—Class B. The redemption of these notes was funded in part with proceeds from a $260 million incremental term loan facility and our revolving credit facility which are each subject to the terms of our Credit Agreement, and cash on hand. The redemption was completed on November 25, 2011. Additionally, on December 21, 2011, we issued notices to redeem all of the remaining 61/2% Senior Subordinated Notes at par, plus accrued and unpaid interest through the redemption date. We used proceeds from the incremental term loan and cash on hand to fund the aggregate redemption price. On December 21, 2011, we irrevocably deposited with the trustee the full amount of the redemption price of our 61/2% Senior Subordinated Notes. As of December 31, 2011, the $255.2 million irrevocable deposit was classified as restricted cash in our consolidated balance sheets, and $251.0 million of our 61/2% Senior Subordinated Notes, net of a discount of $1.2 million, remained outstanding. The redemption was completed on January 20, 2012, and as of that date, there were no 61/2% Senior Subordinated Notes outstanding. For further information on these transactions see "Description of Indebtedness".

    Stock repurchase program.  During the year ended December 31, 2011, our Board of Directors approved a stock repurchase program that authorized us to repurchase up to $25 million of our class A common stock over a 12 month period. This program was extended by our Board of Directors in November 2012 and was scheduled to expire on the earlier of the completion of all purchases contemplated by the plan or November 14, 2013; however, on February 12, 2013, as a result of entering into the Merger Agreement, we terminated the stock repurchase program. Prior to the termination, during the years ended December 31, 2012 and 2011, we repurchased approximately 3.3 million and 0.8 million shares of our class A common stock on the open market for an aggregate purchase price of $11.4 million and $2.7 million, respectively.

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        We believe that our cash flows from our current operations, together with available borrowings under our senior secured credit facility, will be sufficient to meet our anticipated cash requirements for the next 12 months, and beyond (see previous discussion of management's plan for extinguishment or funding some or all of the $163 million tax liability related to the JV Sale Transaction). These cash requirements include working capital, state and federal income taxes, capital expenditures, and scheduled interest and principal payments. For our long-term liquidity needs, in addition to the sources described above, we may rely upon, among other things, the issuance of long-term debt, the issuance of equity, or other financing sources available to us. Volatility and disruption of the capital and credit markets could impact our ability to access such sources. Anticipated cash payments for our debt and related interest are described below.

Contractual Obligations

        The following table summarizes our estimated future contractual cash obligations as of December 31, 2012 (in thousands):

 
  2013   2014-2015   2016-2017   2018 and thereafter   Total  

Principal payments and mandatory redemptions on debt(1)

  $ 11,353   $ 41,428   $ 101,080   $ 803,821   $ 957,682  

Cash interest on debt(2)

    53,511     107,396     119,118     95,107     375,132  

Program payments(3)

    28,831     21,036     1,416     328     51,611  

Operating leases(4)

    2,866     5,174     4,685     7,985     20,710  

Operating agreements(5)

    25,712     36,058     18,164     2,237     82,171  

Deferred compensation payments(6)

    35     204     142     339     720  
                       

Total

  $ 122,308   $ 211,296   $ 244,605   $ 909,817   $ 1,488,026  
                       

(1)
Principal payments on debt include $5 million outstanding under our revolving credit facility, as well as a $60 million incremental term facility that was funded on February 12, 2013, each of which were made in connection with the JV Sale Transaction. These incremental loan amounts were not outstanding as of December 31, 2012 and are not reflected in our balance sheet as of that date. We are obligated to make mandatory quarterly principal payments and to use proceeds of asset sales not reinvested to pay-down the term loans under our senior secured credit facility. We are also obligated to repay in full our Senior Notes as described in Item 1A. "Risk Factors—We may not be able to refinance all or a portion of our indebtedness or obtain additional financing on satisfactory terms".

(2)
We have contractual obligations to pay cash interest on our senior secured credit facility and on our Senior Notes through April 15, 2018 and January 15, 2021, as well as commitment fees of 0.50% on our revolving credit facility, as described in "Description of Indebtedness".

(3)
We have entered into commitments for future syndicated news, entertainment, and sports programming. We have recorded $9.6 million of program obligations as of December 31, 2012 and have unrecorded commitments of $42 million for programming that is not available to air as of December 31, 2012.

(4)
We lease land, buildings, vehicles and equipment under non-cancelable operating lease agreements.

(5)
We have entered into a variety of agreements for services used in the operation of our stations including ratings services, consulting and research services, news video services, news weather services, marketing services and other contracts under non-cancelable operating agreements.

(6)
Includes scheduled payments to certain employees covered under our deferred compensation plans.

        The above table excludes future payments for our defined benefit retirement plans, deferred taxes and executive compensation, with the exception of scheduled deferred compensation payments detailed above, because their future cash outflows are uncertain. In addition, it excludes the $163 million tax liability associated with the JV Sale Transaction, as we believe it will be extinguished as a result of the Merger. For additional information regarding our financial commitments as of December 31, 2012 see Note 7—"Long-term Debt", Note 11—"Retirement Plans" and Note 15—"Commitments and Contingencies" to our consolidated financial statements.

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Summary of Cash Flows

        The following table presents summarized cash flow information (in thousands):

 
  Year Ended December 31,    
   
 
 
  2012   2011   2010   2012 vs 2011   2011 vs 2010  

Net cash provided by operating activities

  $ 146,699   $ 62,660   $ 90,231   $ 84,039   $ (27,571 )

Net cash used in investing activities

    (104,259 )   (289,180 )   (23,649 )   184,921     (265,531 )

Net cash (used in) provided by financing activities

    (14,190 )   232,929     (66,039 )   (247,119 )   298,968  
                       

Net increase in cash and cash equivalents

  $ 28,250   $ 6,409   $ 543   $ 21,841   $ 5,866  
                       

        Net cash provided by operating activities increased $84.0 million to $146.7 million for the year ended December 31, 2012, compared to cash provided by operating activities of $62.7 million for the prior year. The increase was primarily attributable to the $82 million increase in operating income as compared to the year ended December 31, 2011.

        Net cash provided by operating activities decreased $27.6 million to $62.7 million for the year ended December 31, 2011, compared to cash provided by operating activities of $90.2 million for the prior year. The decrease was primarily attributable to a $22.7 million decrease in operating income as compared to the year ended December 31, 2010.

        Net cash used in investing activities decreased $184.9 million to $104.3 million for year ended December 31, 2012, compared to cash used in investing activities of $289.2 million for the prior year. The decrease is primarily attributable to a decrease in restricted cash that had been placed on irrevocable deposit as of December 31, 2011 and was subsequently used to fund the aggregate redemption price of our 61/2% Senior Subordinated Notes in January 2012 as further described in "Description of Indebtedness". The decrease in restricted cash was partially offset by an increase in payments made for the acquisition of the New Vision and ACME television stations as further described in Note 2—"Acquisitions" to our consolidated financial statements.

        Net cash used in investing activities increased $265.5 million to $289.2 million for year ended December 31, 2011, compared to cash used in investing activities of $23.6 million for the prior year. The increase is primarily attributable to an increase in restricted cash as a result of $255.2 million of cash placed on irrevocable deposit for the full amount of the redemption price of our 61/2% Senior Subordinated Notes as further described in "Description of Indebtedness". The increase is also attributable to an increase in payments for business combinations of $8.5 million and an increase in capital expenditures of $2.6 million. These increases were partially offset by a decrease of $1.6 million for shortfall loans to our joint venture with NBCUniversal and other investments of $1.6 million.

        Net cash used in financing activities was $14.2 million for the year ended December 31, 2012, compared to net cash provided by financing activities of $232.9 million for the prior year. The increase is primarily attributable to the redemption of $252 million of our Senior Subordinated Notes during 2012, partially offset by a decrease in proceeds from borrowings under our new senior secured credit facility as further described in "Description of Indebtedness".

        Net cash provided by financing activities was $232.9 million for the year ended December 31, 2011, compared to net cash used in financing activities of $66.0 million for the prior year. The increase is primarily attributable to an increase in proceeds from borrowings under our new senior secured credit facility, partially offset by payments on our 61/2% Senior Subordinated Notes as further described in "Description of Indebtedness".

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Description of Indebtedness

        Debt consisted of the following (in thousands):

 
  December 31,  
 
  2012   2011  

Senior Secured Credit Facility:

             

Revolving credit loans

  $   $ 35,000  

$125,000 Term loans, net of discount of $435 and $604 as of December 31, 2012 and 2011, respectively

    124,565     124,396  

$257,400 and $260,000 Incremental term loans, net of discount of $2,020 and $2,594 as of December 31, 2012 and 2011, respectively

    255,380     257,406  

83/8% Senior Notes due 2018

    200,000     200,000  

63/8% Senior Notes due 2021

    290,000      

61/2% Senior Subordinated Notes due 2013

        166,773  

$0 and $85,426 61/2% Senior Subordinated Notes due 2013—Class B, net of discount of $0 and $1,228 as of December 31, 2012 and 2011, respectively

        84,198  

Capital leases obligations

    14,881     162  

Other debt

    5,401     782  
           

Total debt

    890,227     868,717  

Less current portion

    10,756     253,856  
           

Total long-term debt

  $ 879,471   $ 614,861  
           

Total debt

  $ 890,227   $ 868,717  

Cash and cash equivalents

    (46,307 )   (18,057 )

Restricted cash

        (255,159 )
           

Consolidated net debt(1)

  $ 843,920   $ 595,501  
           

(1)
Consolidated net debt is a non-GAAP financial measure, and is equal to total debt less cash and cash equivalents. Solely for the purpose of computing consolidated net debt as of December 31, 2011, our senior secured credit facility permits restricted cash to be offset against total debt. Beginning in 2012, for the purpose of our debt covenant calculations, our senior credit facility permits a maximum of $45 million to be offset against total debt in arriving at consolidated net debt. For purposes of the table above, we have subtracted the total balance of our cash and cash equivalents as of December 31, 2012 in arriving at consolidated net debt. Consolidated net debt provides investors with useful information about our financial position, and is one of the financial measures used to evaluate compliance with our debt covenants.

Senior Secured Credit Facility

        Our senior secured credit facility is comprised of a six-year, $125 million tranche A term loan and a five-year, $75 million revolving credit facility, and bears interest at a rate based on, at our option, either a) the LIBOR interest rate, or b) the ABR rate, which is an interest rate that is equal to the greatest of (i) the Prime Rate, (ii) the Federal Funds Effective Rate plus 1/2 of 1 percent, and (iii) the one-month LIBOR rate plus 1%. In addition, the rate we select also bears an applicable margin based upon our Consolidated Senior Secured Leverage Ratio, currently set at 2.75% and 1.75% for LIBOR based loans and ABR rate loans, respectively. Lastly, the unused portion of the revolving credit facility is subject to a commitment fee based upon our Consolidated Senior Secured Leverage Ratio, currently set at 0.375% for both LIBOR based loans and ABR rate loans.

        Our senior secured credit facility also includes a seven-year, $260 million tranche B incremental term loan facility and a $60 million tranche B-2 incremental term facility that was funded on February 12, 2013

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in connection with the JV Sale Transaction, each of which is subject to the terms of our Credit Agreement. Borrowings under the incremental term loan facility were used (i) to pay the call price for our redemption of all of our remaining 61/2% Senior Subordinated Notes, as described below, and (ii) to pay accrued interest, fees and expenses associated with the redemption. Borrowings under the incremental term loan facility bear interest at a rate based, at our option, on an adjusted LIBOR rate, plus an applicable margin of 3%; or an adjusted Base Rate, plus an applicable margin of 2%; provided that the adjusted LIBOR rate and the adjusted Base Rate shall at no time be less than 1% and 2%, respectively.

        On December 24, 2012, we entered into an amendment to our Credit Agreement which (1) replaced our $257.4 million tranche B term loan maturing in December 2018 with a new tranche B term loan of the same maturity which bears interest at a reduced rate and (2) made certain other changes to the Credit Agreement, including changes to the financial covenants therein that are favorable to LIN Television and its affiliates and (3) extended the maturity for a $60 million tranche of our revolving credit facility to October 2017. We paid customary fees and expenses in connection with the closing of such amendment. As a result of this amendment, we recorded a loss on extinguishment of debt of $1.2 million associated with a write-down of deferred financing fees and unamortized discount to our consolidated statement of operations during the three months ended December 31, 2012.

        The terms of the Credit Agreement provide for customary representations and warranties, affirmative and negative covenants (including financial covenants), and events of default. The Credit Agreement also provides for the payment of customary fees and expenses by us. The credit facilities available under the Credit Agreement can be accelerated upon events of default and require the term loans to be prepaid under certain circumstances with amounts determined by reference to the proceeds from certain asset sales (subject to reinvestment rights), the incurrence of certain indebtedness and a percentage of annual excess cash flow.

        The credit facilities are senior secured obligations and rank senior in right of payment to our existing and future subordinated indebtedness. LIN TV and certain of our existing, or hereafter created or acquired, domestic subsidiaries guarantee the credit facilities on a senior basis. LIN Television and each of our subsidiary guarantors have granted a security interest in all or substantially all of our assets to secure the obligations under senior secured credit facility, and LIN TV has granted a security interest in its capital stock of LIN Television to secure such obligations.

        Our senior secured credit facility permits us to prepay loans and to permanently reduce the revolving credit commitments, in whole or in part, at any time. We are also obligated to make mandatory quarterly principal payments. In addition, our senior secured credit facility restricts the use of proceeds from asset sales not reinvested in our business and the use of proceeds from the issuance of debt (subject to certain exceptions), which must be used for mandatory prepayments of principal of the term loans.

        The Credit Agreement governing our senior secured credit facility also requires on an annual basis, following the delivery of our year-end financial statements, and commencing after the year ended December 31, 2012, mandatory prepayments of principal of the term loans based on a computation of excess cash flow for the preceding fiscal year, as more fully described in the Credit Agreement. However, based on the excess cash flow computation for the year ended December 31, 2012, we will not be required to make such prepayments during the year ending December 31, 2013.

        The incremental term loan facility is a senior secured obligation and ranks senior in right of payment to our existing and future subordinated indebtedness. The incremental term loan facility is guaranteed and secured on the same basis as the other credit facilities under the Credit Agreement. If we do not refinance, redeem or discharge our 83/8% Senior Notes on or prior to January 15, 2018, then, in such event, the maturity of the incremental term loan facility will be accelerated from December 21, 2018 to January 15, 2018.

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        The following table summarizes certain key terms including the LIBOR-based borrowing rates of our senior secured credit facility as of the date of this report (in thousands):

 
  Credit Facility  
 
  Revolving
Facility
  Term Loans   Incremental
Term Loans
 

Final maturity date

    10/26/2017     10/26/2017     12/21/2018  

Available balance as of December 31, 2012

  $ 75,000   $   $  

Interest rates as of December 31, 2012:

                   

Interest rate

    0.21 %   0.21 %   1.00 %

Applicable margin

    2.75 %   2.75 %   3.00 %
               

Total

    2.96 %   2.96 %   4.00 %
               

2009 Senior Secured Credit Facility

        During the years ended December 31, 2011 and 2010, we recorded a loss on extinguishment of debt of $0.2 million and $2.7 million, respectively, consisting of a write-down of deferred financing fees related to the revolving credit facility and term loans under our 2009 senior secured credit facility.

83/8% Senior Notes

 
  83/8% Senior Notes

Final maturity date

  4/15/2018

Annual interest rate

  8.375%

Payable semi-annually in arrears

  April 15th

  October 15th

        Our 83/8% Senior Notes are unsecured but rank equally in right of payment with all senior secured indebtedness and senior to all subordinated indebtedness.

        The indenture governing our 83/8% Senior Notes contains covenants limiting our ability and the ability of our restricted subsidiaries to, among other things, incur certain additional indebtedness and issue preferred stock; make certain dividends, distributions, investments and other restricted payments; sell certain assets; agree to any restrictions on the ability of restricted subsidiaries to make payments to us; create certain liens; merge, consolidate or sell substantially all of our assets; and enter into certain transactions with affiliates. These covenants are subject to certain exceptions and qualifications. The indenture also has change of control provisions which may require our Company to purchase our 83/8% Senior Notes at a price equal to 101% of the principal amount thereof, together with accrued and unpaid interest. Additionally, if we sell assets under certain circumstances, we will be required to make an offer to purchase our 83/8% Senior Notes at their face amount, plus accrued and unpaid interest, if any, through the purchase date.

63/8% Senior Notes

 
  63/8% Senior Notes

Final maturity date

  1/15/2021

Annual interest rate

  6.375%

Payable semi-annually in arrears

  January 15th

  July 15th

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        On October 12, 2012, we completed the issuance and sale of $290 million in aggregate principal amount of our 63/8% Senior Notes. The net proceeds of our 63/8% Senior Notes were used to fund the remaining purchase price for the acquisition of the New Vision stations as further described in Note 2—"Acquisitions" to our consolidated financial statements.

        Our 63/8% Senior Notes are unsecured but rank pari passu in right of payment with all senior secured indebtedness and senior to all subordinated indebtedness.

        The indenture governing our 63/8% Senior Notes contains covenants limiting our ability and the ability of our restricted subsidiaries to, among other things, incur certain additional indebtedness and issue preferred stock; make certain dividends, distributions, investments and other restricted payments; sell certain assets; agree to any restrictions on the ability of restricted subsidiaries to make payments to us; create certain liens; merge, consolidate or sell substantially all of our assets; and enter into certain transactions with affiliates. These covenants are subject to certain exceptions and qualifications. The indenture also has change of control provisions which may require our Company to purchase our 63/8% Senior Notes at a price equal to 101% of the principal amount thereof, together with accrued and unpaid interest. Additionally, if we sell assets under certain circumstances, we will be required to make an offer to purchase our 63/8% Senior Notes at their face amount, plus accrued and unpaid interest, if any, through the purchase date.

61/2% Senior Subordinated Notes and 61/2% Senior Subordinated Notes—Class B

        During the years ended December 31, 2012 and 2011, we redeemed $252 million and $165 million, respectively, of our 61/2% Senior Subordinated Notes. The redemption of these notes, at par, was funded in part by proceeds from the term loan, incremental term loan, the revolving credit facility and cash on hand. As a result of these redemptions, during the years ended December 31, 2012 and 2011, we recorded a loss on extinguishment of debt of $2.1 million and $1.5 million, respectively, associated with a write-down of deferred financing fees and unamortized discount to our consolidated statement of operations.

Capital Lease Obligations

        As part of the transactions further described in Note 2—"Acquisitions," to our consolidated financial statements we assumed $14.9 million in capital lease obligations related to land, buildings and equipment. These leases mature over a period of four to nineteen years and are payable in monthly installments. The amortization related to the capital lease obligations is recorded within depreciation. LIN Television fully and unconditionally guarantees these lease obligations.

Other Debt

        During the year ended December 31, 2012, Vaughan, a consolidated VIE, entered into a term loan with an unrelated third party in an original principal amount of $4.6 million to fund a portion of the purchase price for the television stations from PBC that were acquired by Vaughan. This term loan matures in equal quarterly installments through October 2017. LIN Television fully and unconditionally guarantees this loan.

        During the year ended December 31, 2012, KASY, a consolidated VIE, entered into a term loan with an unrelated third party in an original principal amount of $1.7 million to fund a portion of the purchase price for the acquisition of certain assets of KASY-TV, KRWB-TV, and KWBQ-TV. This term loan matures in equal quarterly installments through December 2017. LIN Television fully and unconditionally guarantees this loan.

        During the year ended December 31, 2011, WBDT, a consolidated VIE, entered into a term loan with an unrelated third party in an original principal amount of $0.9 million to fund a portion of the purchase

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price for the acquisition of certain assets of WBDT-TV. This term loan matures in equal quarterly installments through May 2016. LIN Television fully and unconditionally guarantees this loan.

Repayment of Principal

        The following table summarizes scheduled future principal repayments on our debt agreements (in thousands):

 
  Revolving
Facilities
  Term Loans   Incremental
Term Loans
  83/8% Senior
Notes
  63/8% Senior
Notes
  Capital
Leases
  Other Debt   Total  

Final maturity date

    10/26/2017     10/26/2017     12/21/2018     4/15/2018     1/15/2021     Various     Various        

2013

  $   $ 6,250   $ 3,200   $   $   $ 453   $ 1,450   $ 11,353  

2014

        12,500     3,200             421     1,450     17,571  

2015

        18,750     3,200             457     1,450     23,857  

2016

        25,000     3,200             596     702     29,498  

2017

    5,000 (1)   62,500     3,200             533     349     71,582  

2018 and thereafter

            301,400 (1)   200,000     290,000     12,421         803,821  
                                   

Total

  $ 5,000   $ 125,000   $ 317,400   $ 200,000   $ 290,000   $ 14,881   $ 5,401   $ 957,682  
                                   

(1)
Principal payments on debt include $5 million outstanding under our revolving credit facility, as well as a $60 million incremental term facility that was funded on February 12, 2013, each of which were made in connection with the JV Sale Transaction. These incremental loan amounts were not outstanding as of December 31, 2012 and are not reflected in our balance sheet as of that date.

        The fair values of our long-term debt are estimated based on quoted market prices for the same or similar issues (Level 2 of the fair value hierarchy). The carrying amounts and fair values of our long-term debt were as follows (in thousands):

 
  December 31, 2012   December 31, 2011  
 
  Carrying
Amount
  Estimated
Fair Value
  Carrying
Amount
  Estimated
Fair Value
 

Revolving credit loans

  $   $   $ 35,000   $ 35,000  

Term loans

    379,945     380,599     381,802     379,872  

Senior notes

    490,000     524,500     450,971     444,348  

Other debt

    5,401     5,401     782     782  
                   

Total

  $ 875,346   $ 910,500   $ 868,555   $ 860,002  
                   

Future Program Rights Agreements

        We record program rights agreements on our balance sheet on the first broadcast date the programs are available for air. As a result, we have commitments for future program rights agreements not recorded on our balance sheet as of December 31, 2012 of $42.0 million, as detailed in Note 15—"Commitments and Contingencies" to our consolidated financial statements.

Item 7A.    Quantitative and Qualitative Disclosures About Market Risk

        We are exposed to market risk related to interest rates on our senior secured credit facility debt. In accordance with our interest rate risk management policy, we do not enter into derivative instruments unless there is an underlying exposure, and we do not enter into derivative financial instruments for speculative trading purposes.

Interest Rate Risk

        Our total debt as of December 31, 2012 was $890.2 million, including the current portion of $10.8 million, of which our 83/8% Senior Notes and 63/8% Senior Notes bear a fixed interest rate and the

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credit facility bears an interest rate based on, either a) the LIBOR interest rate, or b) the ABR rate, which is an interest rate that is equal to the greatest of (i) the Prime Rate, (ii) the Federal Funds Effective Rate plus 1/2 of 1 percent, and (iii) the one-month LIBOR rate plus 1%. In addition, the rate we select also bears an applicable margin based upon our consolidated senior secured leverage ratio, currently set at 3% and 2% for LIBOR based loans and ABR rate loans, respectively. Additionally, borrowings under the incremental term loan facility bear interest at a rate based, at our option, on an adjusted LIBOR rate, plus an applicable margin of 3%; or an adjusted Base Rate, plus an applicable margin of 2%; provided, that the adjusted LIBOR rate and the adjusted Base Rate shall at no time be less than 1% and 2%, respectively.

        Accordingly, we are exposed to potential losses related to increases in interest rates. The outstanding balance on our senior secured credit facility was $379.9 million as of December 31, 2012. Therefore, a hypothetical 1% increase in the floating rate used as the basis for the interest charged on our senior secured credit facility as of December 31, 2012 would increase our annualized interest expense by $3.8 million, assuming such amounts remain outstanding under the facility.

Item 8.    Financial Statements and Supplementary Data

        See index on page F-1.

Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

        None.

Item 9A.    Controls and Procedures

        a)    Evaluation of disclosure controls and procedures.    Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2012. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2012, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

        b)    Management's Report on Internal Control Over Financial Reporting.    Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f). Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policy or procedures may deteriorate. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have conducted an evaluation of the effectiveness of our internal control over financial reporting based upon the Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. As permitted by the SEC, we have excluded the

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operations acquired from affiliates of New Vision and ACME from our evaluation as of December 31, 2012 because those stations were acquired by us in purchase business combinations on October 12, 2012 and December 10, 2012, respectively. New Vision assets acquired represent 31% of consolidated total assets and 7% of consolidated total revenues as of and for the year ended December 31, 2012. ACME Television assets acquired represent less than 1% of consolidated total assets and less than 1% of consolidated total revenues acquired as of and for the year ended December 31, 2012. Based on this evaluation, which excludes the New Vision and ACME Television stations, our Chief Executive Officer and Chief Financial Officer have concluded that our internal control over financial reporting was effective as of December 31, 2012.

        The effectiveness of our internal control over financial reporting as of December 31, 2012 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein.

        c)    Changes in internal controls.    There were no changes in our internal control over financial reporting identified in connection with the evaluation that occurred during the quarter ended December 31, 2012 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

Item 9B.    Other Information

        None.

PART III

Item 10.    Directors and Executive Officers and Corporate Governance

        Information regarding members of our Board of Directors is contained in our Proxy Statement for the 2013 Annual Meeting of the Stockholders under the caption "Directors and Executive Officers" and is incorporated herein by reference. Information regarding our executive officers is contained in our Proxy Statement for the 2013 Annual Meeting of the Stockholders under the caption "Executive Officers" and is incorporated herein by reference. Information regarding Section 16(a) compliance is contained in our Proxy Statement for the 2013 Annual Meeting of Stockholders under the caption "Security Ownership of Certain Beneficial Owners and Management" and is incorporated herein by reference. Information regarding our Audit Committee and our Audit Committee Financial Expert is contained in our Proxy Statement for the 2013 Annual Meeting of the Stockholders under the caption "Report of the Audit Committee of our Board of Directors" and is incorporated herein by reference.

Item 11.    Executive Compensation

        The information required by this item is contained in our Proxy Statement for the 2013 Annual Meeting of Stockholders under the captions "Compensation Discussion and Analysis," "Director Compensation," "Report of the Compensation Committee of our Board of Directors," and "Compensation Committee Interlocks and Insider Participation," which is incorporated by reference in this report.

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Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Equity compensation plans

        The following table provides information about the securities authorized for issuance under our stock-based compensation plans, including our 1998 Stock Option Plan, Amended and Restated 2002 Stock Plan, and Third Amended and Restated 2002 Non-Employee Director Stock Plan, as of December 31, 2012:

Plan category
  Number of securities to
be issued upon exercise
of outstanding options
warrants and rights
  Weighted-average
exercise price of
outstanding options
warrants and rights
  Number of securities
remaining available
for future issuance
under the stock-based
compensation plans(1)
 

Stock-based compensation plans approved by security holders

    4,894,179   $ 3.42     2,896,347  

Stock-based compensation plans not approved by security holders

             

(1)
Includes 1,457,409 shares available for future issuance under the Amended and Restated 2002 Stock Plan, and excludes 1,552,983 shares under plans in effect prior to 2002 from which we do not intend to re-grant and consider unavailable for future grant, and 1,438,938 shares available for future issuance under the Third Amended and Restated 2002 Non-Employee Director Stock Plan. Both the Amended and Restated 2002 Stock Plan and the Third Amended and Restated 2002 Non-Employee Director Stock Plan, in addition to the future grant of stock options, permit the grant of "stock awards" that may take the form of restricted or unrestricted stock, with or without payment for such stock awards.

Other Information

        All other information required by this item is contained in our Proxy Statement for the 2013 Annual Meeting of Stockholders under the caption "Security Ownership of Certain Beneficial Owners and Management", which is incorporated by reference in this report.

Item 13.    Certain Relationships and Related Transactions and Director Independence

        The response to this item is contained in our Proxy Statement for the 2013 Annual Meeting of Stockholders under the caption "Certain Relationships and Related Transactions", which is incorporated by reference in this report.

Item 14.    Principal Accounting Fees and Services

        The response to this item is contained in our Proxy Statement for the 2013 Annual Meeting of Stockholders under the caption "Independent Registered Public Accounting Firm Fees and Other Matters", which is incorporated by reference in this report.

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PART IV

Item 15.    Exhibits and Financial Statement Schedules

    (a)
    See Index to Financial Statements on page F-1.

    (b)
    Exhibits.

No.   Description
  3.1   Second Amended and Restated Certificate of Incorporation of LIN TV Corp., as amended (filed as Exhibit 3.1 to our Quarterly Report on Form 10-Q filed as of August 9, 2004 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  3.2   Third Amended and Restated Bylaws of LIN TV Corp. (filed as Exhibit 3.2 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2007 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  3.3   Restated Certificate of Incorporation of LIN Television Corporation (filed as Exhibit 3.1 to the Quarterly Report on Form 10-Q of LIN TV Corp. and LIN Television Corporation for the fiscal quarter ended June 30, 2003 (File No. 000-25206) and incorporated by reference herein)
  3.4   Restated Bylaws of LIN Television Corporation (filed as Exhibit 3.4 to the Registration Statement on Form S-1 of LIN Television Corporation and LIN Holding Corp. (Registration No. 333-54003 and incorporated by reference herein))
  4.1   Specimen of stock certificate representing LIN TV Corp. Class A Common stock, par value $.01 per share (filed as Exhibit 4.1 to LIN TV Corp.'s Registration Statement on Form S-1 (Registration No. 333-83068) and incorporated by reference herein)
  4.2   Indenture, dated April 12, 2010, among LIN Television Corporation, the guarantors named therein and J.P. Morgan Securities Inc. as representative of the initial purchasers of the 83/8% Senior Notes due 2018 (filed as Exhibit 4.1 to our Current Report on Form 8-K as of April 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  4.3   Supplemental Indenture, dated as of January 17, 2013, among LIN Mobile, LLC, LIN Television Corporation and The Bank of New York, as Trustee for the 83/8% Senior Notes due 2018 (filed as Exhibit 4.3 herein)
  4.4   Indenture, dated as of October 12, 2012, among LIN Television Corporation, the Guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as Trustee, for the 63/8% Senior Notes due 2021 (filed as Exhibit 4.1 to LIN TV Corp.'s Current Report on Form 8-K filed as of October 17, 2012 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  4.5   Supplemental Indenture, dated as of January 17, 2013, among LIN Mobile, LLC, LIN Television Corporation and The Bank of New York, as Trustee for the 63/8% Senior Notes due 2021 (filed as Exhibit 4.5 herein).
  10.1 * LIN TV Corp. (formerly known as Ranger Equity Holdings Corporation) 1998 Stock Option Plan (filed as Exhibit 10.26 to our Annual Report on Form 10-K of LIN Holdings Corp. and LIN Television Corporation for the fiscal year ended December 31, 1998 (File No. 333-54003-06) and incorporated by reference herein)
  10.2 * LIN TV Corp. Amended and Restated 2002 Stock Plan, effective May 22, 2012 (included as Appendix A to LIN TV Corp.'s definitive proxy statement on Schedule 14A filed with the SEC on April 12, 2012 and incorporated by reference herein)
  10.3 * LIN TV Corp. Amended and Restated 2002 Non-Employee Director Stock Plan, effective May 11, 2010 (included as Appendix A to LIN TV Corp.'s definitive proxy statement on Schedule 14A filed with the SEC on April 12, 2010 and incorporated by reference herein)

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No.   Description
  10.4 * LIN Television Corporation Supplemental Benefit Retirement Plan (as amended and restated effective December 21, 2004) (Filed as Exhibit 10.38 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2004 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.5 * Second Amendment to the Supplemental Benefit Retirement Plan of LIN Television and Subsidiary Companies, dated as of December 31, 2008 (Filed as Exhibit 10.8 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.6 * LIN TV Corp. Amended and Restated Employee Stock Purchase Plan, effective May 22, 2012 (included as Appendix B to LIN TV Corp.'s definitive proxy statement on Schedule 14A filed with the SEC on April 12, 2012 and incorporated by reference herein)
  10.7 * LIN Television Corporation Supplemental Income Deferral Plan Effective July 1, 2010 (Filed as Exhibit 10.7 to our Form 10-Q filed as of April 27, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.8 * Form of Employee Grant Option Agreement (Filed as Exhibit 10.19 to our Form 10-K filed as of March 15, 2007 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.9 * Form of Non-Employee Director Grant Option Agreement (Filed as Exhibit 10.23 to our Form 10-K filed as of March 15, 2007 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.10 * Form of a Non-qualified Stock Option Letter Agreement (filed as Exhibit 10.6 to our Current Report on Form 8-K filed as of July 6, 2005 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.11 * Form of Restricted Stock Agreement (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed as of August 16, 2005 (File No. 001-31311) and incorporated by reference herein)
  10.12 * Clarification of the Supplemental Benefit Retirement Plan of LIN Television Corporation and subsidiary companies, dated October 29 2009. (Filed as exhibit 10.7 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.13 * Employment Agreement dated November 1, 2006, and made effective as of July 12, 2006, between LIN Television Corporation and Vincent L. Sadusky (Filed as exhibit 10.1 to our Current Report on Form 8-K filed as of February 27, 2007 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.14 * Employment Agreement dated February 22, 2007, and made effective as of September 6, 2006, between LIN Television Corporation and Scott M. Blumenthal (Filed as exhibit 10.2 to our Current Report on Form 8-K filed as of February 27, 2007 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.15 * Employment Agreement dated February 22, 2007, and made effective as of September 6, 2006, between LIN Television Corporation and Denise M. Parent (Filed as Exhibit 10.4 to our Current Report on Form 8-K filed as of February 27, 2007 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.16 * Employment Agreement between LIN TV Corp., LIN Television Corporation and Richard Schmaeling dated September 30, 2008, effective as of October 6, 2008. (Filed as Exhibit 10.1 to our Current Report on Form 8-K filed as of October 3, 2008 (File Nos. 001-31311) and incorporated by reference herein)
  10.17 * Employment Agreement between LIN TV Corp., LIN Television Corporation and Robert Richter dated September 30, 2008 effective as of September 10, 2008. (Filed as Exhibit 10.22 to our Form 10-K for the fiscal year ended December 31, 2008 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)

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No.   Description
  10.18 * Employment Agreement between LIN TV Corp., LIN Television Corporation and Nicholas N. Mohamed, dated and effective February 18, 2009. (Filed as Exhibit 10.1 to our Current Report on Form 8-K filed as of March 26, 2009 (Files Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.19 * Amendment to Employment Agreement dated October 29, 2009 between LIN TV Corp., LIN Television Corporation and Vincent L. Sadusky. (Filed as Exhibit 10.1 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.20 * Amendment to Employment Agreement dated October 29, 2009 between LIN TV Corp., LIN Television Corporation and Scott M. Blumenthal. (Filed as Exhibit 10.2 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.21 * Amendment to Employment Agreement dated October 29, 2009 between LIN TV Corp., LIN Television Corporation and Denise M. Parent. (Filed as exhibit 10.3 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.22 * Amendment to Employment Agreement dated October 29, 2009 between LIN TV Corp., LIN Television Corporation and Richard Schmaeling. (Filed as Exhibit 10.4 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.23 * Amendment to Employment Agreement dated October 29, 2009 between LIN TV Corp., LIN Television Corporation and Robert Richter. (Filed as Exhibit 10.5 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.24 * Amendment to Employment Agreement dated October 29, 2009 between LIN TV Corp., LIN Television Corporation and Nicholas N. Mohamed. (Filed as Exhibit 10.6 to our Form 10-Q filed as of November 3, 2009 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.25 * Second Amendment to Employment Agreement dated February 28, 2010 between LIN TV Corp., LIN Television Corporation and Vincent L. Sadusky (Filed as Exhibit 10.30 to our Annual Report on Form 10-K filed as of March 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.26 * Second Amendment to Employment Agreement dated February 28, 2010 between LIN TV Corp., LIN Television Corporation and Scott M. Blumenthal (Filed as Exhibit 10.31 to our Annual Report on Form 10-K filed as of March 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.27 * Second Amendment to Employment Agreement dated February 28, 2010 between LIN TV Corp., LIN Television Corporation and Denise M. Parent (Filed as Exhibit 10.32 to our Annual Report on Form 10-K filed as of March 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.28 * Second Amendment to Employment Agreement dated February 28, 2010 between LIN TV Corp., LIN Television Corporation and Richard J. Schmaeling (Filed as Exhibit 10.33 to our Annual Report on Form 10-K filed as of March 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.29 * Second Amendment to Employment Agreement dated February 28, 2010 between LIN TV Corp., LIN Television Corporation and Robert Richter (Filed as Exhibit 10.34 to our Annual Report on Form 10-K filed as of March 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)

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No.   Description
  10.30 * Second Amendment to Employment Agreement dated February 28, 2010 between LIN TV Corp., LIN Television Corporation and Nicholas N. Mohamed (Filed as Exhibit 10.35 to our Annual Report on Form 10-K filed as of March 15, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.31 * Third Amendment to Employment Agreement entered into on July 29, 2010, and made effective as of May 11, 2010, between LIN TV Corp., LIN Television Corporation and Vincent L. Sadusky (Filed as Exhibit 10.1 to our Form 10-Q filed as of July 29, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.32 * Third Amendment to Employment Agreement entered into on July 29, 2010, and made effective as of May 11, 2010, between LIN TV Corp., LIN Television Corporation and Scott M. Blumenthal (Filed as Exhibit 10.2 to our Form 10-Q filed as of July 29, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.33 * Third Amendment to Employment Agreement entered into on July 29, 2010, and made effective as of May 11, 2010, between LIN TV Corp., LIN Television Corporation and Denise M. Parent (Filed as Exhibit 10.3 to our Form 10-Q filed as of July 29, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.34 * Third Amendment to Employment Agreement entered into on July 29, 2010, and made effective as of May 11, 2010, between LIN TV Corp., LIN Television Corporation and Richard J. Schmaeling (Filed as Exhibit 10.4 to our Form 10-Q filed as of July 29, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.35 * Third Amendment to Employment Agreement entered into on July 29, 2010, and made effective as of May 11, 2010, between LIN TV Corp., LIN Television Corporation and Robert Richter (Filed as Exhibit 10.5 to our Form 10-Q filed as of July 29, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.36 * Third Amendment to Employment Agreement entered into on July 29, 2010, and made effective as of May 11, 2010, between LIN TV Corp., LIN Television Corporation and Nicholas N. Mohamed (Filed as Exhibit 10.6 to our Form 10-Q filed as of July 29, 2010 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.37 * Fourth Amendment to Employment Agreement entered into on January 16, 2012, and made effective as of January 1, 2012, between LIN TV Corp., LIN Television Corporation and Robert Richter (Filed as Exhibit 10.37 to our Form 10-K filed as of March 15, 2012 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.38   Credit Agreement dated as of October 26, 2011, among LIN Television Corporation, as the Borrower, the lenders party named therein, JPMorgan Chase Bank, N.A., as Administrative Agent, as an Issuing Lender and as Swingline Lender, Deutsche Bank Securities, Inc. and Wells Fargo Securities, LLC, as Co-Syndication Agents, Suntrust Bank, Bank of America, N.A., and U.S. Bank, N.A., as Co-Documentation Agents, and the other parties thereto (the "Credit Agreement") (Filed as Exhibit 10.1 to our Form 10-Q filed as of November 8, 2011 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.39   First Amendment, dated as of December 19, 2011, to Credit Agreement, dated as of October 26, 2011, among LIN Television Corporation, the several Lenders party thereto, JPMorgan, as Administrative Agent, an Issuing Lender and Swingline Lender, Deutsche Bank Securities Inc., and Wells Fargo Bank, N.A., as Co-Syndication Agents, Suntrust Bank, Bank of America, N.A. and U.S. Bank, N.A., as Co-Documentation Agents, and the other parties thereto (Filed as Exhibit 99.2 to our Current Report on Form 8-K filed as of December 22, 2011 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)

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No.   Description
  10.40   Second Amendment to the Credit Agreement, dated as of December 24, 2012 to Credit Agreement, dated as of October 26, 2011, among LIN Television Corporation, the several Lenders party thereto, JPMorgan, as Administrative Agent, an Issuing Lender and Swingline Lender, Deutsche Bank Securities Inc. and Wells Fargo Bank, N.A. as Co-Syndication Agents, Suntrust Bank, Bank of America, N.A. and U.S. Bank, N.A., as Co-Documentation Agents, and the other parties thereto (Filed as Exhibits 99.1 and 99.2 to our Form 8-K filed as of December 27, 2012 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.41   Incremental Term Loan Activation Notice, Tranche B Term Facility, dated December 21, 2011, by and among the Company, JPMorgan as Administrative Agent, and the Incremental Lenders signatory thereto. (Filed as Exhibit 99.1 to our Current Report on Form 8-K filed as of December 22, 2011 (File Nos. 001-31311 and 000-25206) and incorporated by reference herein)
  10.42   Incremental Term Loan Activation Notice Tranche B-2 Term Facility, dated as of February 12, 2013, by and between LIN Television Corporation and Deutsche Bank Trust Company Americas (Filed as Exhibit 10.1 to our Form 8-K filed as of February 15, 2013 (File Nos. 001-31311 and 000-25206) and incorporated herein)
  10.43   Transaction Agreement, dated as of February 12, 2013, by and among LIN TV Corp., LIN Television Corporation, LIN Television of Texas, L.P., NBC Telemundo License LLC, NBCU New LLC I, NBCU New LLC II, General Electric Company, General Electric Capital Corporation, National Broadcasting Company Holding, Inc. Comcast Corporation, Lone Star SPV, LLC and Station Venture Holdings, LLC (Filed as Exhibit 2.1 to our Form 8-K filed as of February 15, 2013 (File Nos. 001-31311 and 000-25206) and incorporated herein)
  10.44   Agreement and Plan of Merger, dated as of February 12, 2013, by and between LIN TV Corp. and LIN Media LLC(Filed as Exhibit 2.2 to our Form 8-K filed as of February 15, 2013 (File Nos. 001-31311 and 000-25206) and incorporated herein)
  21   Subsidiaries of the Registrant
  23.1   Consent of PricewaterhouseCoopers LLP
  23.2   Consent of PricewaterhouseCoopers LLP
  23.3   Consent of Deloitte and Touche LLP
  23.4   Consent of KPMG LLP
  31.1   Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Chief Executive Officer of LIN TV Corp.
  31.2   Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Chief Financial Officer of LIN TV Corp.
  31.3   Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Chief Executive Officer of LIN Television Corporation
  31.4   Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Chief Financial Officer of LIN Television Corporation
  32.1   Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of the Chief Executive Officer and Chief Financial Officer of LIN TV Corp.
  32.2   Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of the Chief Executive Officer and Chief Financial Officer of LIN Television Corporation
  101.INS ** XBRL Instance Document
  101.SCH ** XBRL Taxonomy Extension Schema Document
  101.CAL ** XBRL Taxonomy Extension Calculation Linkbase Document
  101.LAB ** XBRL Taxonomy Extension Label Linkbase Document

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No.   Description
  101.PRE ** XBRL Taxonomy Extension Presentation Linkbase Document
  101.DEF ** XBRL Taxonomy Extension Definition Linkbase Document

*
Management contracts and compensatory plans or arrangements required to be filed as an exhibit pursuant to Item 15(b) of Form 10-K.

**
Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.

(c)   Financial Statement Schedule

        The following financial statement schedule is filed herewith:

        Schedule I—Condensed Financial Information of the Registrant

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SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, each of LIN TV Corp. and LIN Television Corporation, has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

    LIN TV CORP.
LIN TELEVISION CORPORATION

Date: March 15, 2013

 

/s/ VINCENT L. SADUSKY

Vincent L. Sadusky
President, Chief Executive Officer and Director

        Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of each of LIN TV Corp. and LIN Television Corporation in the capacities and on the dates indicated.

Signature
 
Title
 
Date

 

 

 

 

 
/s/ VINCENT L. SADUSKY

Vincent L. Sadusky
  President, Chief Executive Officer and
Director (Principal Executive Officer)
  March 15, 2013

/s/ RICHARD J. SCHMAELING

Richard J. Schmaeling

 

Senior Vice President,
Chief Financial Officer
(Principal Financial Officer)

 

March 15, 2013

/s/ NICHOLAS N. MOHAMED

Nicholas N. Mohamed

 

Vice President, Controller
(Principal Accounting Officer)

 

March 15, 2013

/s/ WILLIAM S. BANOWSKY, JR.

William S. Banowsky, Jr.

 

Director

 

March 15, 2013

/s/ ROYAL W. CARSON, III

Royal W. Carson, III

 

Director

 

March 15, 2013

/s/ DR. WILLIAM H. CUNNINGHAM

Dr. William H. Cunningham

 

Director

 

March 15, 2013

/s/ JOHN R. MUSE

John R. Muse

 

Director

 

March 15, 2013

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Signature
 
Title
 
Date

 

 

 

 

 
/s/ MICHAEL A. PAUSIC

Michael A. Pausic
  Director   March 15, 2013

/s/ PETER S. BRODSKY

Peter S. Brodsky

 

Director

 

March 15, 2013

/s/ DOUGLAS W. MCCORMICK

Douglas W. McCormick

 

Chairman of the Board

 

March 15, 2013

73


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Index to Financial Statements

LIN TV Corp.

       

Report of Independent Registered Public Accounting Firm

    F-2  

Consolidated Balance Sheets

    F-3  

Consolidated Statements of Operations

    F-4  

Consolidated Statements of Stockholders' Deficit and Comprehensive Income

    F-6  

Consolidated Statements of Cash Flows

    F-9  

Notes to Consolidated Financial Statements

    F-10  

LIN Television Corporation

       

Report of Independent Registered Public Accounting Firm

    F-63  

Consolidated Balance Sheets

    F-64  

Consolidated Statements of Operations

    F-65  

Consolidated Statements of Stockholder's Deficit and Comprehensive Income

    F-66  

Consolidated Statements of Cash Flows

    F-70  

Notes to Consolidated Financial Statements

    F-71  

Financial Statement Schedule

       

Schedule I—Condensed Financial Information of the Registrant

    F-112  

Station Venture Holdings, LLC

       

Independent Auditors' Report

    F-117  

Balance Sheets

    F-119  

Statement of Operations

    F-120  

Statement of Members' Deficit

    F-121  

Statement of Cash Flows

    F-122  

Notes to Financial Statements

    F-123  

Station Venture Operations, LP

       

Independent Auditors' Report

    F-129  

Balance Sheets

    F-131  

Statement of Operations

    F-132  

Statement of Partners' Capital

    F-133  

Statement of Cash Flows

    F-134  

Notes to Financial Statements

    F-135  

F-1


Table of Contents


Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of LIN TV Corp.:

         In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of LIN TV Corp. and its subsidiaries at December 31, 2012 and December 31, 2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these financial statements and financial statement schedule, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedule, and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

         A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

         Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

         As described in Management's Report on Internal Control over Financial Reporting, management has excluded the assets, liabilities and operations acquired from affiliates of New Vision Television, LLC ("New Vision") and ACME Television, LLC ("ACME") from its assessment of internal control over financial reporting as of December 31, 2012 because they were acquired by the Company on October 12, 2012 and December 10, 2012, respectively, in purchase business combinations. We have also excluded New Vision and ACME from our audit of internal control over financial reporting. New Vision's assets acquired represent 31% of consolidated total assets and 7% of consolidated total revenues as of and for the year ended December 31, 2012. ACME's assets acquired represent less than 1% of both consolidated total assets and consolidated total revenues as of and for the year ended December 31, 2012.

/s/ PricewaterhouseCoopers LLP

Hartford, CT
March 15, 2013

F-2


Table of Contents

Part I. Financial Information
Item 1.    Consolidated Financial Statements

LIN TV Corp.
Consolidated Balance Sheets

 
  December 31,  
 
  2012   2011  
 
  (in thousands, except
share data)

 

ASSETS

             

Current assets:

             

Cash and cash equivalents

  $ 46,307   $ 18,057  

Restricted cash

        255,159  

Accounts receivable, less allowance for doubtful accounts (2012—$3,599; 2011—$2,310)

    126,150     91,093  

Deferred income tax assets

        4,249  

Assets held for sale

        3,253  

Other current assets

    7,699     6,090  
           

Total current assets

    180,156     377,901  

Property and equipment, net

    243,595     145,429  

Deferred financing costs

    19,135     12,472  

Goodwill

    189,138     122,069  

Broadcast licenses, net

    536,515     390,826  

Other intangible assets, net

    59,686     9,255  

Assets held for sale

        12,505  

Other assets

    13,189     11,487  
           

Total assets(a)

  $ 1,241,414   $ 1,081,944  
           

LIABILITIES AND DEFICIT

             

Current liabilities:

             

Current portion of long-term debt

  $ 10,756   $ 253,856  

Accounts payable

    18,955     10,972  

Accrued expenses

    154,012     38,578  

Deferred income tax liabilities

    168,219      

Program obligations

    10,770     9,892  

Liabilities held for sale

        3,719  
           

Total current liabilities

    362,712     317,017  

Long-term debt, excluding current portion

    879,471     614,861  

Deferred income tax liabilities

    40,556     167,371  

Program obligations

    4,281     3,874  

Liabilities held for sale

        1,308  

Other liabilities

    42,716     58,642  
           

Total liabilities(a)

    1,329,736     1,163,073  
           

Commitments and Contingencies (Note 15)

             

Redeemable noncontrolling interest

   
3,242
   
3,503
 

LIN TV Corp. stockholders' deficit:

             

Class A common stock, $0.01 par value, 100,000,000 shares authorized,
Issued: 35,672,528 and 34,650,169 shares as of December 31, 2012 and 2011, respectively
Outstanding: 30,724,869 and 33,012,351 shares as of December 31, 2012 and 2011, respectively

    313     309  

Class B common stock, $0.01 par value, 50,000,000 shares authorized, 23,401,726 shares as of December 31, 2012 and 2011, issued and outstanding; convertible into an equal number of shares of class A or class C common stock

    235     235  

Class C common stock, $0.01 par value, 50,000,000 shares authorized, 2 shares as of December 31, 2012 and 2011, issued and outstanding; convertible into an equal number of shares of class A common stock

         

Treasury stock, 4,947,659 and 1,637,818 shares of class A common stock as of December 31, 2012 and 2011, respectively, at cost

    (21,984 )   (10,598 )

Additional paid-in capital

    1,129,691     1,121,589  

Accumulated deficit

    (1,164,435 )   (1,157,390 )

Accumulated other comprehensive loss

    (35,384 )   (38,777 )
           

Total deficit

    (91,564 )   (84,632 )
           

Total liabilities and deficit

  $ 1,241,414   $ 1,081,944  
           

(a)
Our consolidated assets as of December 31, 2012 and 2011 include total assets of $60,380 and $10,688, respectively, of variable interest entities ("VIEs") that can only be used to settle the obligations of the VIEs. These assets include broadcast licenses and other intangible assets of $46,604 and $7,815 and program rights of $2,060 and $1,574 as of December 31, 2012 and 2011, respectively. Our consolidated liabilities as of December 31, 2012 and 2011 include $5,440 and $2,490, respectively, of total liabilities of the VIEs for which the VIE's creditors have no recourse to the Company, including $1,967 and $1,884, respectively, of program obligations. See further description in Note 1—"Basis of Presentation and Summary of Significant Accounting Policies."

The accompanying notes are an integral part of the consolidated financial statements.

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LIN TV Corp.

Consolidated Statements of Operations

 
  Year Ended December 31,  
 
  2012   2011   2010  
 
  (in thousands, except
per share data)

 

Net revenues

  $ 553,462   $ 400,003   $ 408,190  

Operating expenses:

                   

Direct operating

    160,222     130,618     119,159  

Selling, general and administrative

    125,267     103,770     102,063  

Amortization of program rights

    23,048     21,406     22,719  

Corporate

    34,246     26,481     23,943  

Depreciation

    32,149     26,246     27,013  

Amortization of intangible assets

    6,364     1,199     1,549  

Restructuring

    1,009     707     3,136  

Loss (gain) from asset dispositions

    96     472     (3,231 )
               

Operating income

    171,061     89,104     111,839  

Other expense:

                   

Interest expense, net

    46,683     50,706     51,525  

Share of loss in equity investments

    98,309     4,957     169  

(Gain) loss on derivative instruments

        (1,960 )   1,898  

Loss on extinguishment of debt

    3,341     1,694     2,749  

Other expense (income), net

    237     51     (728 )
               

Total other expense, net

    148,570     55,448     55,613  

Income before provision for (benefit from) income taxes

    22,491     33,656     56,226  

Provision for (benefit from) income taxes

    40,463     (16,045 )   20,045  
               

(Loss) income from continuing operations

    (17,972 )   49,701     36,181  

Discontinued operations:

                   

(Loss) income from discontinued operations, net of a (benefit from) provision for income taxes of $(541), $(595) and $181 for the years ended December 31, 2012, 2011 and 2010, respectively

    (1,018 )   (920 )   317  

Gain on sale of discontinued operations, net of a provision for income taxes of $6,223 for the year ended December 31, 2012

    11,389          
               

Net (loss) income

    (7,601 )   48,781     36,498  

Net (loss) income attributable to noncontrolling interests

    (556 )   204      
               

Net (loss) income attributable to LIN TV Corp. 

  $ (7,045 ) $ 48,577   $ 36,498  
               

Basic (loss) income per common share attributable to LIN TV Corp.:

                   

(Loss) income from continuing operations attributable to LIN TV Corp. 

  $ (0.32 ) $ 0.89   $ 0.67  

(Loss) income from discontinued operations, net of tax

    (0.02 )   (0.02 )   0.01  

Gain on the sale of discontinued operations, net of tax

    0.21          
               

Net (loss) income attributable to LIN TV Corp. 

  $ (0.13 ) $ 0.87   $ 0.68  
               

Weighted-average number of common shares outstanding used in calculating basic (loss) income per common share

    54,130     55,768     53,978  

Diluted (loss) income per common share attributable to LIN TV Corp.:

                   

(Loss) income from continuing operations attributable to LIN TV Corp. 

  $ (0.32 ) $ 0.87   $ 0.65  

(Loss) income from discontinued operations, net of tax

    (0.02 )   (0.02 )   0.01  

Gain on the sale of discontinued operations, net of tax

    0.21          
               

Net (loss) income attributable to LIN TV Corp. 

  $ (0.13 ) $ 0.85   $ 0.66  
               

Weighted-average number of common shares outstanding used in calculating diluted (loss) income per common share

    54,130     57,079     55,489  

   

The accompanying notes are an integral part of the consolidated financial statements.

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LIN TV Corp.

Consolidated Statements of Comprehensive (Loss) Income

 
  Year Ended December 31,  
 
  2012   2011   2010  
 
  (in thousands)
 

Net (loss) income

  $ (7,601 ) $ 48,781   $ 36,498  

Pension net gain (loss), net of tax of $(2,132), $6,912, and $1,720 for the years ended December 31, 2012, 2011 and 2010, respectively

    3,393     (10,838 )   (2,538 )

Unrealized gain on cash flow hedge, net of tax of $1,603 for the year ended December 2010

            2,516  
               

Comprehensive (loss) income

    (4,208 )   37,943     36,476  

Comprehensive (loss) income attributable to noncontrolling interest

    (556 )   204      
               

Comprehensive (loss) income attributable to LIN TV Corp. 

  $ (3,652 ) $ 37,739   $ 36,476  
               

The accompanying notes are an integral part of the consolidated financial statements.

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LIN TV Corp.

Consolidated Statements of Stockholders' Deficit

(in thousands, except share data)

 
  Common Stock    
   
   
   
   
 
 
  Class A   Class B   Class C    
   
   
  Accumulated
Other
Comprehensive
Loss
   
 
 
  Treasury
Stock
(at cost)
  Additional
Paid-In
Capital
  Accumulated
Deficit
  Total
Stockholders'
Deficit
 
 
  Shares   Amount   Shares   Amount   Shares   Amount  

Balance at December 31, 2011

    34,650,169   $ 309     23,401,726   $ 235     2   $   $ (10,598 ) $ 1,121,589   $ (1,157,390 ) $ (38,777 ) $ (84,632 )

Pension net losses, net of tax of $2,132

                                        3,393     3,393  

Stock-based compensation

    1,022,359     4                         8,102             8,106  

Purchase of LIN TV Corp. class A common stock

                            (11,386 )               (11,386 )

Net loss

                                    (7,045 )       (7,045 )
                                               

Balance at December 31, 2012

    35,672,528   $ 313     23,401,726   $ 235     2   $   $ (21,984 ) $ 1,129,691   $ (1,164,435 ) $ (35,384 ) $ (91,564 )
                                               

The accompanying notes are an integral part of the consolidated financial statements.

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Table of Contents


LIN TV Corp.

Consolidated Statements of Stockholders' Deficit

(in thousands, except share data)

 
  Common Stock    
   
   
   
   
 
 
  Class A   Class B   Class C    
   
   
  Accumulated
Other
Comprehensive
Loss
   
 
 
  Treasury
Stock
(at cost)
  Additional
Paid-In
Capital
  Accumulated
Deficit
  Total
Stockholders'
Deficit
 
 
  Shares   Amount   Shares   Amount   Shares   Amount  

Balance at December 31, 2010

    32,509,759   $ 294     23,502,059   $ 235     2   $   $ (7,869 ) $ 1,109,814   $ (1,205,967 ) $ (27,939 ) $ (131,432 )

Pension net losses, net of tax of $6,912

                                        (10,838 )   (10,838 )

Stock-based compensation

    890,077     3                         7,014             7,017  

Issuance of LIN TV Corp. class A common stock

    1,150,000     12                         4,761             4,773  

Purchase of LIN TV Corp. class A common stock

                            (2,729 )               (2,729 )

Class B common stock conversion to class A common stock

    100,333         (100,333 )                                

Net income