-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, HF03+AKRLUaorexOOJhWN43WvwcLi9EIH+Am607o+L0gHfAHvLfs9tvMgzK3wgG8 /1489k2nxJf1sq/dVFpauA== 0000059498-95-000004.txt : 19950502 0000059498-95-000004.hdr.sgml : 19950502 ACCESSION NUMBER: 0000059498-95-000004 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19941231 FILED AS OF DATE: 19950501 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIN BROADCASTING CORP CENTRAL INDEX KEY: 0000059498 STANDARD INDUSTRIAL CLASSIFICATION: TELEVISION BROADCASTING STATIONS [4833] IRS NUMBER: 620673800 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-02481 FILM NUMBER: 95533575 BUSINESS ADDRESS: STREET 1: 1150 CONNECTICUT AVENUE NW STREET 2: 4TH FLOOR CITY: WASHINGTON STATE: DC ZIP: 20036 BUSINESS PHONE: 2068281902 MAIL ADDRESS: STREET 1: 1150 CONNECTICUT AVENUE NW STREET 2: 4TH FLOOR CITY: WASHINGTON STATE: DC ZIP: 20036 10-K/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K/A (Amendment No. 1) [X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended December 31, 1994 OR [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ___________ to ___________ Commission File No. 0-2481 _________________________________________________________________ LIN BROADCASTING CORPORATION (Exact name of registrant as specified in its charter) Delaware 62-0673800 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 5295 Carillon Point Kirkland, Washington 98033 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (206) 828-1902 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $.01 per share (Title of Class) 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 [X] No [ ] 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. [ ] The number of shares outstanding of the registrant's Common Stock was 51,695,750 as of March 31, 1995, excluding 3,630,268 treasury shares. The aggregate market value of the voting stock held by non-affiliates of the registrant was $3,194,381,565 as of March 31, 1995. (The term "affiliates" is deemed, for this purpose only, to refer only to the directors of the registrant, to McCaw Cellular Communications, Inc. and to AT&T Corp.) DOCUMENTS INCORPORATED BY REFERENCE None. 1 PART III Item 10. Directors and Executive Officers of the Registrant. Directors The following table lists the individuals who serve as directors of the Company and certain information concerning such directors. Name Age Position With the Company - --------------- --- ------------------------- Tom A. Alberg 55 President, Chief Operating Officer and Director Dennis J. Carey 48 Director Lewis M. Chakrin 47 Chairman of the Board Harold S. Eastman 56 Director W. Preston Granbery 51 Director William G. Herbster 62 Director Rolla G. Huff 38 Director Wilma H. Jordan 46 Director Richard W. Kislik 67 Director Wayne M. Perry 45 Vice Chairman of the Board Florence L. Walsh 33 Director Tom A. Alberg became a director of the Company in 1991. Mr. Alberg has been the President and Chief Operating Officer of the Company since April 1991 and has been Executive Vice President of McCaw Cellular Communications, Inc. ("McCaw") since July 1990. Prior to July 1990, Mr. Alberg was the Chairman of the Executive Committee and a partner in the Perkins Coie law firm. He is a director of Digital Systems International, Inc., Active Voice Corporation, and LIN Television Corporation. Dennis J. Carey became a director of the Company in 1994. Mr. Carey has been the Vice President, Finance and Audit of AT&T Corp. ("AT&T") since February 1994. Prior to that he served as Vice President, Business Development and International of General Electric Corporation from February 1992 to February 1994 and as Senior Vice President and General Manager Corporate Finance Group of General Electric Capital Corporation from August 1987 to February 1992. He is a director of LIN Television Corporation. Lewis M. Chakrin became a director of the Company in 1994 and has been Chairman of the Board since March 1995. Mr. Chakrin has been Vice President and General Manager, Global Wireless Products Group of AT&T since April 1995. Prior to that he served with AT&T as Vice President, Business Development - 2 Communications Services Group from March 1994 to April 1995, Vice President, Personal Communications Services from July 1991 to March 1994, Director, Strategic Planning -- International Communication Services from May 1990 to July 1991, and Sales Vice President, Business Sales Division from September 1987 to May 1990. He is a director of LIN Television Corporation. Harold S. Eastman became a director of the Company in 1990. He was Vice Chairman of the Board of the Company from March 1990 to April 1992. Mr. Eastman is the President of Peregrine Capital Co., a private investment company. He served as President of McCaw from June 1989 to December 1991 and thereafter as Vice Chairman of the Board of McCaw until April 1992. W. Preston Granbery became a director of the Company in 1994. Mr. Granbery has been a General Attorney with the Corporate and Securities Group of AT&T since 1988. William G. Herbster became a director of the Company in 1976. Mr. Herbster is a financial consultant. He is a director of Ithaca BanCorp, Inc. and LIN Television Corporation and Senior Advisor to the Investment Fund for Foundations. Rolla G. Huff became a director of the Company in 1994. Mr. Huff has been the Chief Financial Officer of McCaw since April 1995. Prior to that he served as Financial Vice President and Chief Financial Officer, Mergers and Acquisitions of AT&T from October 1993 to April 1995 and with NCR Corp. as Controller, US from January 1992 to September 1993, Director, Service Marketing Europe from April 1991 to December 1991 and Director, Operations from August 1989 to March 1991. Wilma H. Jordan became a director of the Company in 1987. Ms. Jordan is Co-Chairman of The Jordan, Edmiston Group, Inc., an investment banking and management consulting firm for publishing companies. She is a director of Ringier America Printing Co., Guideposts Associates, Inc., Clayton Homes, Inc. and LIN Television Corporation. Richard W. Kislik became a director of the Company in 1969. Mr. Kislik has been a publishing consultant since 1985. He is a director of LIN Television Corporation. Wayne M. Perry became a director of the Company in 1990. Mr. Perry has been Vice Chairman of the Board of the Company since March 1990 and Vice Chairman of the Board of McCaw since June 1989 and Secretary of McCaw since October 1994. From December 1985 to June 1989, Mr. Perry served as President of McCaw. 3 Florence L. Walsh became a director of the Company in 1995. Ms. Walsh has been the Assistant Treasurer - Corporate Finance of AT&T since November 1994. Prior to that she served as the Director, Domestic Finance of General Motors Corporation from January 1989 to October 1994. Arrangements for the Election of Directors. Ms. Jordan and Messrs. Herbster and Kislik have been elected and serve as the "Independent Directors" as defined in and in accordance with the Private Market Value Guarantee between the Company and McCaw (the "PMVG"). See "Item 1. Business - Private Market Value Guarantee - - Independent Directors." Each of the remaining directors either is or at the time of his or her election to the Board of Directors was an employee of AT&T or McCaw. Director Compensation. Directors who are not also officers of the Company or its affiliates are compensated at the rate of $30,000 per annum. In addition, directors who are not also officers of the Company or its affiliates receive $1,500 for each Board of Directors meeting attended and $1,500 for each committee meeting attended, as long as that meeting is not held in conjunction with a board meeting. Directors are also reimbursed for any travel expenses incurred in connection with such meetings. In addition, each Independent Director receives $1,500 for each meeting attended by him or her exclusive of full board or committee meetings. Ms. Jordan and Messrs. Herbster and Kislik each receive $250 per hour, or $2,000 per eight-hour day, for additional services performed in their capacities as Independent Directors, including time spent attending and preparing for meetings of the Independent Directors and otherwise devoting attention to those matters requiring consideration by the Independent Directors. Ms. Jordan and Messrs. Herbster and Kislik received $38,688, $37,790 and $57,625, respectively, for such services rendered in 1994, which consisted primarily of time spent reviewing materials and attending meetings of the Independent Directors and meetings with their financial and legal advisors concerning the spin-off to the Company's stockholders of LIN Television Corporation (the "Television Spin-off") (see "Certain Relationships and Related Transactions - Relationship With LIN Television Corporation") and the PMVG process. All directors of the Company have the option of deferring their compensation under the Company's Deferred Compensation Plan. 4 Executive Officers The executive officers of the Company are: Steven W. Hooper 42 Chief Executive Officer Tom A. Alberg 55 President, Chief Operating Officer and Director Wayne M. Perry 45 Vice Chairman of the Board Donald Guthrie 39 Senior Vice President-Finance For additional information regarding Messrs. Alberg and Perry, see "Directors." Steven W. Hooper has been Chief Executive Officer of the Company since March 1995 and Chief Executive Officer of McCaw since January 1995. From 1993 to January 1995, he was Executive Vice President and Chief Financial Officer of McCaw. From 1988 until 1993, he was Senior Vice President-Cellular Operations of McCaw. Prior to 1988, Mr. Hooper served with McCaw as Executive Vice President and Chief Operating Officer of its Cable Division and in various financial positions. Donald Guthrie became Vice President-Finance of the Company in March 1990 and was promoted to Senior Vice President-Finance in June 1992. Since February 1986, Mr. Guthrie has been a Senior Vice President and the Treasurer of McCaw. Compliance With Section 16(a) of the Securities Exchange Act Section 16(a) of the Securities Exchange Act of 1934 (the "1934 Act") requires the Company's directors, certain of its officers and the beneficial owners of more than ten percent of its Common Stock to file reports related to their ownership of the Company's common stock (the "Common Stock") and of changes in such ownership with the Securities and Exchange Commission (the "SEC") and the National Association of Securities Dealers. SEC regulations also require the Company to identify in this proxy statement any person subject to this requirement who failed to file any such report on a timely basis. AT&T and Messrs. Carey and Chakrin inadvertently filed late the initial report required at the time each of them became a ten percent shareholder or director of the Company. 5 Item 11. Executive Compensation. The three tables set forth below provide information with respect to the annual and long-term compensation for services in all capacities to the Company for fiscal years 1994, 1993, and 1992 and the option grants, exercises and values in and at the end of fiscal year 1994 of those persons who (i) served, at any time during 1994, as the Company's Chief Executive Officer or (ii) were, during 1994, the four other most highly compensated executive officers of the Company (collectively, the "named executive officers"). 6 Summary Compensation Table
Long-Term Compensation ------------ Awards Annual Compensation ---------- Name and -------------------------------- Securities All Other Principal Salary Other Annual Underlying Compensation Position (1) Year ($) Bonus($) Compensation($) Options (#) ($)(2) - ------------ ---- ------- ------- -------------- ----------- ------------ Craig O. McCaw(3) 1994 $100,112 0 0 0 $ 2,469 Chairman of the 1993 100,000 0 0 0 2,308 Board and Chief 1992 100,200 0 0 0 2,225 Executive Officer Tom A. Alberg (4) 1994 250,487 $250,000 0 50,000 15,977 President and Chief 1993 235,000 200,000 0 50,000 12,517 Operating Officer 1992 225,000 150,200 0 50,000 10,912 James L. Barksdale(5) 1994 525,487 467,000 0 0 14,967 Chairman of the 1993 525,000 400,000 0 0 14,506 Board and Chief 1992 500,200 300,000 $70,293 (6) 0 4,167 Executive Officer Gary R. Chapman (7) 1994 475,000 150,000 0 0 15,481 (8) President-LIN 1993 404,600 150,000 0 20,000 163,014 (8) Television Group 1992 385,000 125,000 0 20,000 160,839 (8) Donald Guthrie (9) 1994 200,487 100,000 0 35,000 3,813 Senior Vice 1993 190,000 75,200 0 35,000 2,919 President-Finance 1992 180,000 60,200 0 30,000 2,650 (continued) 7 Summary Compensation Table (continued) Long-Term Compensation ------------ Awards Annual Compensation ---------- Name and -------------------------------- Securities All Other Principal Salary Other Annual Underlying Compensation Position (1) Year ($) Bonus($) Compensation($) Options (#) ($)(2) - ------------ ---- -------- ------- -------------- ----------- ------------ Wayne M. Perry (10) 1994 100,487 250,000 0 0 5,139 Vice Chairman 1993 100,000 0 0 0 4,975 of the Board 1992 100,000 0 0 0 4,885 - ------------------- (1) All amounts shown for Messrs. Alberg, Chapman and Guthrie were paid by the Company, and all amounts shown for Messrs. McCaw, Barksdale and Perry were paid by McCaw. Upon approval by the Independent Directors of the proposed intercompany reimbursement program for 1994, each of the Company and McCaw will reimburse the other for a portion of such executives' compensation (other than Mr. Chapman, who rendered services solely to the Company prior to the completion of the Television Spin-off). See "Certain Relationships and Related Transactions - Relationship with AT&T and McCaw - Other." (2) Represents amounts paid for life and disability insurance premiums unless otherwise indicated. (3) Mr. McCaw resigned from his positions as Chairman of the Board and an executive officer of the Company effective October 25, 1994. Mr. McCaw also received options to purchase 210,000 shares of McCaw's Class A Common Stock in 1993. All such options that were outstanding at the time of the acquisition of McCaw by AT&T (the "McCaw/AT&T Merger") were converted into options to purchase Common Stock of AT&T. Mr. McCaw also received from McCaw additional compensation related solely to his employment with and services rendered to McCaw. 8 (4) Mr. Alberg also received from McCaw additional compensation related solely to his employment with and services rendered to McCaw. (5) Mr. Barksdale was elected Chairman of the Board and Chief Executive Officer of the Company on November 2, 1994. Mr. Barksdale resigned from all positions with the Company effective January 13, 1995. Mr. Barksdale also received options to purchase 200,000 and 340,000 shares of McCaw's Class A Common Stock in 1993 and 1992, respectively. All such options that were outstanding at the time of the McCaw/AT&T Merger were converted into options to purchase common stock of AT&T. Mr. Barksdale also received from McCaw and AT&T additional compensation related solely to his employment with and services rendered to McCaw. (6) Represents a tax-equalization payment. (7) Mr. Chapman resigned as an executive officer of the Company effective December 28, 1994 following the Television Spin-off. See "Certain Relationships and Related Transactions - Relationship with LIN Television Corporation." Amounts reported are those paid to Mr. Chapman for services rendered in 1994 for the entire year, although a portion of such amounts was paid by LIN Television Corporation following completion of the Television Spin-off. (8) Amount for 1994 represents life and disability insurance premiums. Amounts for 1993 and 1992 represent $13,014 and $10,839, respectively, paid for life and disability insurance premiums and a $150,000 payment in each year in consideration of Mr. Chapman's agreeing in 1990 to forego certain benefits under a severance agreement. (9) Mr. Guthrie also received from McCaw additional compensation related solely to his employment with and services rendered to McCaw. (10) Mr. Perry also received from McCaw additional compensation related solely to his employment with and services rendered to McCaw. 9 Option Grants in Fiscal Year 1994 Individual Grants -------------------------------------------------- Number of Potential Realizable Securities Percent of Value at Assumed Underlying Total Options Annual Rates of Stock Options Granted to Exercise Price Appreciation Granted Employees in Price Expiration for Option Term (2) Name (#) (1) Fiscal Year ($/Sh) Date 5% ($) 10% ($) - --------------- --------- ------------ -------- ---------- -------- ------- Craig O. McCaw 0 0 N/A N/A 0 0 Tom A. Alberg 50,000 16.581% $133.50 12/31/04 $4,197,872 $10,638,231 James L. Barksdale 0 0 N/A N/A 0 0 Gary R. Chapman 0 0 N/A N/A 0 0 Donald Guthrie 35,000 11.607% 133.50 12/31/04 $2,938,510 $7,446,762 Wayne M. Perry 0 0 N/A N/A 0 0 All stockholders(3) N/A N/A N/A N/A $4,330,439,664 $10,974,184,339 Named executive N/A N/A N/A N/A 0.16 0.16 officers' gain as % of all stockholders' gain - ------------------ (1) All options granted to the named executive officers become exercisable in three annual installments of 33%, 33% and 34% beginning one year after the grant date. The per share option exercise prices represent the fair market value of the Common Stock on the date of grant. The option term is 10 years. In the event of a change in control of the Company, other than certain transactions with McCaw and certain transactions pursuant to the PMVG, officers of the 10 Company who are subject to Section 16 of the 1934 Act may surrender vested options in exchange for a cash payment by the Company. As a result of the closing of the McCaw/AT&T Merger, the options to purchase Common Stock held by the named executive officers will vest (if not otherwise vested prior thereto pursuant to their terms) if the optionee's employment with the Company is terminated under certain circumstances. See "Employment Contracts and Termination of Employment and Change-in-Control Arrangements." (2) The dollar amounts under these columns are the result of calculations at the 5% and 10% assumed appreciation rates set by the SEC and therefore are not intended to forecast possible future appreciation, if any, of the Common Stock price. At the 5% and 10% assumed appreciation rates, the price per share of Common Stock would be $217.46 and $346.26, respectively. (3) Based on number of shares outstanding on December 31, 1994. 11 Aggregated Option Exercises in Fiscal Year 1994 and Fiscal Year-End Option Values Number of Shares Shares Underlying Unexercised Value of Unexercised Acquired Options at Fiscal In-the-Money Options on Value Year-End (#) at Fiscal Year-End($)(2) Exercise Realized -------------------------- -------------------------- Name (#) ($) (1) Exercisable Unexercisable Exercisable Unexercisable - -------------- -------- -------- ----------- ------------- ----------- ------------- Craig O. McCaw N/A N/A 67,500 22,500 $4,662,137 $1,540,712 Tom A. Alberg 30,000 $1,967,500 20,000 130,000 1,123,978 3,768,369 James L. Barksdale N/A N/A 0 0 N/A N/A Gary R. Chapman N/A N/A 59,220 33,000 4,599,207 1,575,824 Donald Guthrie N/A N/A 26,000 85,250 1,588,036 2,255,488 Wayne M. Perry 900 55,800 44,100 15,000 3,019,796 1,027,142 - ----------------- (1) This amount represents the aggregate of the number of shares acquired on exercise multiplied by the difference between the closing price of the Common Stock on the Nasdaq National Market on the respective option exercise date (or, if not exercised on a trading day, the nearest trading day) minus the exercise price for the relevant option. (2) This amount represents the aggregate of the number of in-the-money options multiplied by the difference between the closing price of the Common Stock on the Nasdaq National Market on December 30, 1994 (the final trading day in 1994) and the exercise prices for the relevant options.
12 Pension Plan Until December 28, 1994, the Company maintained a defined benefit retirement plan (the "Pension Plan") that covered certain employees of the Company and its subsidiaries. On December 28, 1994, pursuant to the Employee Benefits Allocation Agreement between the Company and LIN Television Corporation ("LIN Television"), LIN Television assumed sponsorship of the Pension Plan. See "Certain Relationships and Related Transactions - Relationship With LIN Television Corporation." LIN Television now is solely responsible for all liabilities and obligations under the Pension Plan. Mr. Chapman continues to participate in the Pension Plan as an employee of LIN Television. Effective January 1, 1993, the Pension Plan was amended to provide that any employees treated by the Company as employed by a component of the Company that maintains an Internal Revenue Code (the "Code") Section 401(k) plan providing for employer-matching contributions are not eligible to participate in, or accrue benefits under, the Pension Plan. After retirement from or other termination with the Company, however, any employee who was participating in the Pension Plan as of December 31, 1992, is entitled to receive monthly payments under the Pension Plan based on his or her average compensation and years of credited service as of December 31, 1992, provided that he or she completes five years of vesting service with the Company after attaining age 17. Such payments begin at age 65, subject to the employee's election to terminate from employment and receive reduced monthly payments beginning at any time between ages 55 and 65. Due to this amendment, Messrs. Alberg and Guthrie no longer accrue additional benefits under the Pension Plan, but are entitled to receive monthly payments of $459 and $329, respectively, under the Pension Plan at age 65, provided they each become vested. Messrs. McCaw, Barksdale and Perry did not participate in the Pension Plan. The following table shows the estimated annual retirement benefits payable under the Pension Plan and the Company's Supplemental Benefit Retirement Plan as an annuity for life upon normal retirement for specified compensation and years of credited service classifications, assuming retirement at age 65 on December 31, 1993. Benefits are computed by multiplying (i) 1.25% of the employee's average annual compensation for the three consecutive years producing the highest average (excluding benefits or payments received under any other benefit plan) times (ii) the employee's number of years of credited service, up to a maximum of 32 years. Section 401(a)(17) and 415 of the Code limit the annual benefits that may be paid from a tax-qualified retirement plan such as the Pension Plan. As permitted by the 13 Employee Retirement Income Security Act of 1974 ("ERISA"), the Company's Supplemental Benefit Retirement Plan authorizes the payment out of the Company's general funds of any benefits calculated under the provisions of the Pension Plan that may be above the limits of Sections 401(a)(17) and 415 of the Code. 14 Pension Plan Table Three-Year Average Years of Credited Service Annual -------------------------------------------------------- Compensation 10 15 20 25 30 32 - ------------ ----- ---- ---- ---- ---- ---- $100,000 12,500 18,750 25,000 31,250 37,500 40,000 $200,000 25,000 37,500 50,000 62,500 75,000 80,000 $300,000 37,500 56,250 75,000 93,750 112,500 120,000 $400,000 50,000 75,000 100,000 125,000 150,000 160,000 $500,000 62,500 93,750 125,000 156,250 187,500 200,000 $750,000 93,750 140,625 187,500 234,375 281,500 300,000 As of December 31, 1994, Mr. Chapman had six years of credited service under the Pension Plan and his three-year average annual compensation was $613,200. Benefit amounts under the Pension Plan are not subject to any deduction for Social Security benefits or other offset amounts. 15 Employment Contracts and Termination of Employment and Change-in-Control Arrangements Employment Agreements. In 1990, Mr. Chapman entered into an employment agreement with the Company, which replaced an already existing severance compensation agreement. Mr. Chapman's employment agreement provides for: (i) a term that currently ends on December 31, 1995, subject to subsequent renewals; (ii) a minimum base salary of $375,000, commencing on January 1, 1991; (iii) a target annual bonus award at least equal to $125,000 per year beginning after December 31, 1991, the actual amount payable being determined by the Company based on performance guidelines; and (iv) a retention bonus of $600,000, payable in four equal annual installments beginning December 31, 1990. The agreement also provides for options, participation in certain of the Company's incentive compensation programs, and additional severance benefits upon termination without cause, including the right to require the Company to purchase certain of its shares and vested options owned by Mr. Chapman as of the date of the employment agreement based on the value of the greater of $112 per share and the "Private Market Price" of the Common Stock as determined in accordance with the PMVG. See "Item 1. Business - Private Market Value Guarantee." The agreement also requires the Company to purchase on January 1, 1995, certain of its shares and vested options owned by Mr. Chapman as of the date of the employment agreement based on a value of the greater of $112 per share and the Private Market Price. This agreement was assigned to and assumed by LIN Television in connection with the Television Spin-off. In 1991, Mr. Guthrie entered into an employment agreement with the Company. Mr. Guthrie's employment agreement provides for (i) a term that currently ends on April 30, 1995, subject, unless terminated, to subsequent automatic annual renewals; (ii) a base salary that currently is $210,000; (iii) options and bonuses as determined by the Board of Directors; and (iv) such other benefits and perquisites as are provided to Company employees or senior executives generally. In the event that Mr. Guthrie is terminated without "cause," as defined in the agreement, or his employment with the Company terminates as a result of the expiration of the term of the agreement, he will receive an amount equal to twelve months' salary and bonus and all long-term compensation that would have vested during the remaining term of the agreement will be immediately vested. Amended and Restated 1969 Stock Option Plan. Pursuant to the Company's Amended and Restated 1969 Stock Option Plan (the "1969 Plan"), in the event of a change in control of the Company (as defined in the 1969 Plan), other than certain transactions 16 with McCaw and certain transactions pursuant to the PMVG, officers of the Company who are subject to Section 16 of the 1934 Act may surrender vested options in exchange for a cash payment by the Company. The amount of the cash payment per share is determined by taking the difference between the exercise price of the shares covered by the options so surrendered and the greater of (i) the highest market price of the Common Stock during the 90-day period prior to the day of surrender and (ii) the highest price paid to any stockholder of the Company in the transaction or group of transactions resulting in the change in control. Such options may be surrendered during the 60-day period following the change in control. As a result of the closing of the McCaw/AT&T Merger, options to purchase shares of Common Stock outstanding on August 14, 1993 held by the named executive officers will vest (if not otherwise vested prior thereto pursuant to their terms) at the time McCaw or any affiliate consummates any acquisition of all or substantially all the remaining shares of the Common Stock or the Company is otherwise sold, whether pursuant to the PMVG or otherwise. In addition, as a result of the closing of the McCaw/AT&T Merger, all outstanding options to purchase Common Stock held by the named executive officers will vest (if not otherwise vested prior thereto pursuant to their terms) if the optionee's employment with the Company is terminated under certain circumstances. Bonus and Severance Arrangements in Connection With the McCaw/AT&T Merger. In connection with the McCaw/AT&T Merger, the Company established an aggregate $7.75 million bonus pool for certain persons employed by the Company and its subsidiaries as of August 15, 1993, conditioned upon both consummation of the McCaw/AT&T Merger (the "McCaw/AT&T Closing"), which occurred on September 19, 1994, and the closing of any acquisition of all or substantially all the remaining shares of Common Stock by McCaw or of a sale of the Company (pursuant to the PMVG or otherwise) (the "LIN Closing"). Except as provided under the Executive Plan, as hereinafter defined, all bonuses payable to executive officers are payable in three installments (50% at the LIN Closing, 25% on the first anniversary of the McCaw/AT&T Closing and 25% on the second anniversary of the McCaw/AT&T Closing), in each case to persons who remain employed by the Company, its ultimate parent or any of their subsidiaries at such times, provided, that if the LIN Closing has not occurred by such anniversary dates of the McCaw/AT&T Closing, such payments will not be made until the date of the LIN Closing. The amounts of the bonuses allocated to Messrs. Alberg and Guthrie are $700,000 and $509,000, respectively. Messrs. McCaw, Alberg, Barksdale, Guthrie and Perry received bonuses under a similar bonus program implemented by McCaw. 17 Also in connection with the McCaw/AT&T Merger, the Company established an Executive Separation Plan (the "Executive Plan"). The Executive Plan provides benefits to certain executives, including Messrs. Alberg and Guthrie, in the event that they are terminated (other than for cause, as defined in the Executive Plan) on or after the McCaw/AT&T Closing or in the event that they terminate their employment within six months following an adverse change in working conditions (including a reduction in salary or bonus opportunities in the absence of overall poor performance, a material reduction in scope of responsibility, authority or other conditions of employment, a notice that an executive's employment location will be moved more than 40 miles or certain decreases in executive perquisites or other employee benefits) on or after the McCaw/AT&T Closing. Under the Executive Plan, executives are entitled to a benefit payment equal to any unpaid installments under the bonus pool, unless terminated for consistently poor performance documented by substantially contemporaneous notices. Mr. Perry is entitled to receive severance benefits, and Messrs. Alberg and Guthrie are entitled to additional severance benefits, in certain circumstances under a severance program established by McCaw in connection with the McCaw/AT&T Merger. In addition, the Company has established an arrangement for the payment of other benefits to certain of the Company's officers, including Messrs. Alberg and Guthrie. In order to receive this benefit, the individual must be an officer or employee of the Company at the time of the LIN Closing. Such payments will be made if the officer's employment with the Company is terminated within 120 days of a LIN Closing under the same circumstances as are described above with respect to the Executive Plan. The amount of such benefits payable to Messrs. Alberg and Guthrie would be $380,000 and $213,333, respectively. The Compensation Committee has approved the payment to certain officers and employees of the Company, including Messrs. Alberg and Guthrie, at the time of the LIN Closing, of a bonus of at least 50% of the bonus paid to such individual in 1994. The amount of the bonus may be increased, in the discretion of the Compensation Committee, based on performance, timing and such other factors as are approved by the Compensation Committee. The minimum amount of such bonuses payable to Messrs. Alberg and Guthrie are $125,000 and $50,000, respectively. In the event that all or any portion of any severance payment, bonus, stock option or other compensation or benefit payable to certain executives, including Messrs. Alberg and Guthrie, as a result of the LIN Closing would subject any executive to an excise tax under Section 4999 of the Code, such 18 executive would be entitled to receive a tax gross-up payment to cover such excise tax and related penalties and interest (including any taxes payable in connection with the gross-up payment). Item 12. Security Ownership of Certain Beneficial Owners and Management. Principal Stockholders Based upon filings with the SEC, the following persons are known to the Company to be "beneficial owners" of 5% or more of the Common Stock: Shares Name and Address Beneficially of Beneficial Owner Owned Percent - ------------------------- ------------- ------- AT&T Corp. 26,989,500 (1) 52.2% 32 Avenue of the Americas New York, New York 10013 The Capital Group Companies, Inc. 3,362,500 (2) 6.5% 333 South Hope Street Los Angeles, California 90071 (1) AT&T holds its shares of Common Stock through its wholly owned subsidiary McCaw, which in turn holds its shares of Common Stock through its wholly owned subsidiary MMM Holdings, Inc. ("MMM"). McCaw and certain of its subsidiaries have entered into an Agreement and Plan of Merger with the Company, as contemplated by the PMVG, pursuant to which McCaw will acquire all of the shares of Common Stock it does not beneficially own at this time, subject to the terms and conditions of such agreement. See "Item 1. Business--Private Market Value Guarantee" and "Certain Relations and Related Transactions - Relationship with AT&T and McCaw - Status of PMVG Sale Process." (2) Capital Guardian Trust Company and Capital Research and Management Company, operating subsidiaries of The Capital Group Companies, Inc., exercised, as publicly reported as of December 31, 1994, investment discretion with respect to 141,400 and 3,221,100 shares of Common Stock, respectively, which were owned by various institutional investors. 19 Security Ownership of Management The following table shows the beneficial ownership of Common Stock as of April 1, 1995 by the Company's (i) directors, (ii) the named executive officers, and (iii) directors, named executive officers and other executive officers as a group. Shares Beneficially Name Owned (1) Percent - ----------------------- ------------------- ------- Tom A. Alberg 1,433 (2) * Dennis J. Carey 0 * Lewis M. Chakrin 0 * Harold S. Eastman 0 * W. Preston Granbery 0 * William G. Herbster 3,480 (3) * Rolla G. Huff 0 * Wilma H. Jordan 578 * Richard W. Kislik 8,410 * Wayne M. Perry 45,000 (4) * Florence L. Walsh 0 * Craig O. McCaw 67,500 (5) * James L. Barksdale 0 * Gary R. Chapman 60,536 (6) * Donald Guthrie 26,577 (7) * All directors, named executive officers and other executive officers as a group (16 persons) 233,514 (8) * - ------------------------ * Less than 1% (1) Certain directors of the Company are directors and/or officers of one or more of AT&T and McCaw, each of which beneficially owns 26,989,500 shares of Common Stock. See "Principal Stockholders." Such individuals disclaim beneficial ownership of such shares. (2) Includes options exercisable within 60 days to purchase 20,000 shares of Common Stock. (3) Represents shares held of record by Mr. Herbster's wife. (4) Includes options exercisable within 60 days to purchase 44,100 shares of Common Stock. (5) Includes options exercisable within 60 days to purchase 67,500 shares of Common Stock. 20 (6) Includes options exercisable within 60 days to purchase 59,220 shares of Common Stock (7) Includes options exercisable within 60 days to purchase 26,000 shares of Common Stock. (8) Includes options exercisable within 60 days to purchase 216,820 shares of Common Stock. Beneficial Ownership of Common Stock of AT&T The following table shows the beneficial ownership of all equity securities of AT&T, the Company's parent, as of April 1, 1995 by the Company's (i) directors, (ii) the named executive officers, and (iii) directors, named executive officers and other executive officers as a group. Shares Beneficially Percent Name Owned of Class - ----------------------- ------------------- -------- Tom A. Alberg 105,453 (1) * Dennis J. Carey 107,637 * Lewis M. Chakrin 22,624 (2) * Harold S. Eastman 100 * W. Preston Granbery 10,370 (3) * William G. Herbster 0 * Rolla G. Huff 5,580 * Wilma H. Jordan 275 (4) * Richard W. Kislik 200 * Wayne M. Perry 1,053,609 (5) 1.0 Florence L. Walsh 0 * Craig O. McCaw 15,913,730 (6) * James L. Barksdale 50,000 * Gary R. Chapman 28 * Donald Guthrie 45,600 (7) * All directors, name executive officers and other executive officers as a group (16 persons) 17,902,840 (8) 1.1 - ------------------------- (1) Includes options exercisable within 60 days to purchase 105,000 shares of AT&T Common Stock. (2) Mr. Chakrin disclaims beneficial ownership of all such shares. (3) Includes options exercisable within 60 days to purchase 10,370 shares of AT&T Common Stock. 21 (4) Includes 175 shares owned by Ms. Jordan's husband and as to which she disclaims beneficial ownership. (5) Includes 47,500 shares held by a trust as to which Mr. Perry disclaims beneficial ownership. Also includes options exercisable within 60 days to purchase 1,006,109 shares of AT&T Common Stock. (6) Includes options exercisable within 60 days to purchase 1,540,289 shares of AT&T Common Stock. (7) Includes options exercisable within 60 days to purchase 45,500 shares of AT&T Common Stock. (8) Includes options exercisable within 60 days to purchase 3,087,896 shares of AT&T Common Stock. Item 13. Certain Relationships and Related Transactions. Relationship With AT&T and McCaw AT&T, through its wholly owned subsidiary McCaw, owns approximately 52% of the outstanding shares of Common Stock. For a description of the PMVG between the Company and McCaw, see "Item 1. Business - Private Market Value Guarantee," together with the update to "- Status of PMVG Sale Process" set forth below. Status of PMVG Sale Process. On April 7, 1995, AT&T and McCaw announced that McCaw has decided to proceed with an acquisition of all of the shares of Common Stock not owned by McCaw or any of its affiliates. On April 28, 1995, an Agreement and Plan of Merger was executed and delivered by and among McCaw, MMM, MMM Acquisition Corp., a wholly owned subsidiary of MMM ("Acquisition") and the Company (the "Merger Agreement"). The Merger Agreement provides for the merger of Acquisition with and into the Company (the "Merger"), as a result of which the Company would become a wholly owned subsidiary of McCaw. The Merger Agreement was approved by the Company's Board of Directors, with six directors voting in favor, three opposed and two abstaining, at a meeting held on April 28, 1995. Upon the consummation of the Merger, the holders of shares of Common Stock other than shares owned by McCaw or any of its wholly owned subsidiaries and shares in the Company's treasury or owned by any wholly owned subsidiary of the Company (collectively, the "Public Shares") or by persons who perfect 22 and maintain their right to dissent to the Merger will be entitled to receive cash in the amount of $127.50, without interest thereon, for each Public Share. Consummation of the Merger is subject to certain conditions, including but not limited to (i) the absence of any order or injunction of any court or governmental authority preventing consummation of the Merger or making consummation subject to any condition or restriction not acceptable to McCaw in its reasonable judgement, (ii) receipt of all necessary governmental and third party consents unless the failure to obtain such consents would not have a material adverse effect on the business, properties, operations, condition (financial or other) or prospects of the Company or McCaw, and (iii) that no suit, action, investigation, inquiry, or other proceeding is pending by or before any governmental authority which questions the validity or legality of the PMVG or the proceedings thereunder or the Merger Agreement or the transactions contemplated by the Merger Agreement or which imposes or could impose any remedy, condition or restriction in connection therewith that is unacceptable to McCaw. In addition, the Merger is subject to the approval of the holders of a majority of the Public Shares who are present and entitled to vote at the meeting of stockholders at which the Merger will be considered (the "Meeting"). The Merger must also be approved by the affirmative vote of shares representing a majority of the shares of outstanding Common Stock entitled to vote thereon. McCaw, which indirectly owns approximately 52% of the voting power of the Common Stock, has agreed that, if the Merger receives the necessary approval of the holders of the Public Shares, it will vote or cause to be voted all of the shares of Common Stock beneficially owned by it and its affiliates and subsidiaries in favor of the Merger. Accordingly, approval of the Merger by the affirmative vote of holders of shares representing a majority of the outstanding voting power of the Common Stock is assured. The Merger Agreement may be terminated at any time by the mutual written consent of the Company and McCaw or by mutual action of their respective Boards of Directors. It also may be terminated by action of the Board of Directors of either the Company or McCaw if (i) the Merger has not been consummated by December 31, 1995 or, if the Merger has received the necessary approval of the holders of Public Shares and is being pursued in good faith by McCaw but has not been completed due to regulatory delays or litigation, August 31, 1996, (ii) an appropriate court or governmental authority has issued a final and nonappealable order, decree or ruling or taken any other action permanently restraining, enjoining or otherwise prohibiting the Merger, or 23 (iii) the Merger and the Merger Agreement do not receive at the Meeting the affirmative vote of the holders of at least a majority of the Public Shares present and entitled to vote at the Meeting. The Merger Agreement contains other terms and conditions, including representations and warranties of the parties thereto and certain covenants of the parties relating to the periods of time before and after completion of the Merger. The foregoing description of the Merger Agreement is qualified in its entirety by reference to the Merger Agreement, a copy of which is being filed with the Securities and Exchange Commission as an exhibit hereto. The terms of the Merger Agreement and other matters related to the Merger will be described in greater detail in a proxy statement to be prepared and delivered to the Company's stockholders prior to the Meeting. The date of the Meeting has not yet been established by the Board of Directors, but the Company currently anticipates that the Meeting will be held sometime during the third quarter of 1995. A class action entitled Frank v. Tom A. Alberg, James L. Barksdale, Harold S. Eastman, Craig O. McCaw, Wayne M. Perry, John E. McCaw, John W. Stanton, McCaw Cellular Communications, Inc., MMM Holdings, Inc., and AT&T Corp. was filed on April 10, 1995 (New York Supreme Court, New York County, Index No. 95-108949). The plaintiff alleges that the defendants breached various fiduciary duties to the Company's public stockholders by failing to protect against, and by the individual defendants (as directors of the Company) approving certain actions facilitating the acquisition of McCaw by AT&T which resulted in, AT&T being disregarded as a potential purchaser of the Company for purposes of certain appraisals conducted pursuant to the PMVG. The plaintiffs seek, among other remedies, monetary damages. The Company cannot predict the possible outcome or effect on the Company or the PMVG process of this action at this time. Other. After McCaw acquired its interest in the Company in March 1990, McCaw made available the services of its employees, some of whom are elected to management positions with the Company, with the understanding that the Company would reimburse McCaw for these services. Under the PMVG, the approval of a majority of the Independent Directors is required before the Company enters into any material transaction with McCaw or its affiliates. Pursuant to a proposal that has been approved by the management of each of the Company and McCaw, and subject only to the approval of the Independent Directors, McCaw will receive reimbursement from the Company in the amount of $8.5 million for 24 services rendered in 1994 in connection with various engineering, research and development, marketing and other general management activities and for payments to third parties, and the Company will receive reimbursement from McCaw in the amount of $2.2 million for services rendered in 1994 in connection with various operations, marketing and legal activities and for payments to third parties. The respective reimbursement amounts include actual amounts paid to third parties. Also included within this reimbursement program is an allocation of the time devoted to the affairs of each company by those employees who were involved in the operation of both companies. The costs associated with such employees, including salary, bonus, stock options awarded during the year and other benefits, are then allocated between the companies in the same proportion. As determined for purposes of this allocation for 1994, Messrs. McCaw, Alberg, Barksdale, Guthrie and Perry devoted 40% (through the McCaw/AT&T Closing), 80%, 40%, 80% and 30%, respectively, of their time to the affairs of the Company; the balance of each executive's time was allocated to McCaw. All of Mr. Chapman's time through the Spin-off Date was devoted to the affairs of the Company. For so long as the Company remains a majority-owned subsidiary of McCaw, the Company and McCaw expect to annually negotiate payments for the reimbursement of expenses incurred on behalf of the Company by McCaw and on behalf of McCaw by the Company for management assistance and other intercompany services. The Company does not anticipate that the net amount of its payments to McCaw will be material to the Company's business operations or financial performance. The payments will continue to be negotiated on an arm's-length basis, and will be subject to the approval of the Independent Directors. In addition to the transactions described above, the Company (including its subsidiaries and other entities it controls or manages) routinely enters into transactions with McCaw and AT&T (including their respective subsidiaries and other entities they control or manage, other than the Company) in the ordinary course of business. The Company pays McCaw for providing cellular service to the Company's subscribers under roaming agreements, and McCaw pays the Company for similar services provided by the Company to McCaw's subscribers. For roaming services provided during 1994, the Company paid McCaw approximately $18.3 million and McCaw paid the Company approximately $13.0 million. In addition, the Company's Dallas cellular operation provided switching, billing, and certain other services to an affiliate of McCaw. Under this agreement, the Company's Dallas cellular operation collects the revenues generated by the subscribers of McCaw's affiliate and pays a contractually determined fee. Such revenues amounted to approximately $1.2 million during 1994, and 25 the payments to McCaw's affiliate amounted to approximately $1.0 million. The Company also reimburses McCaw for the cost of programs, such as the North American Cellular Network, national advertising campaigns and the National Account Services Program (a sales force and support group that coordinates the sale of cellular services to large companies), which McCaw manages for all of its markets, as well as certain of the Company's markets, and for the cost of goods and services purchased by the Company from third parties through McCaw. The Company paid McCaw approximately $1.3 million for expenses in connection with such programs during 1994. The costs of such programs are shared by all markets benefited (including, in certain cases, markets owned by third parties), with the allocation based on actual per market costs incurred or such factors as relative market population or numbers of subscribers. The Company also maintains a regional office that oversees and provides certain centralized services for the Company's Dallas cellular operation as well as a cluster of McCaw cellular markets located in Texas and adjacent states. The costs of this office are allocated to all such markets, based on their relative shares of the factors considered most relevant to each particular cost. For example, the allocation of general and administrative costs is based on population, while engineering and operations costs are allocated based largely on the relative number of cell sites in each market. McCaw's share of such costs during 1994 was approximately $3.9 million. During 1994, the Company purchased equipment, consisting primarily of telephones and accessories, from AT&T for an aggregate purchase price of approximately $13.4 million. The Company also paid AT&T approximately $3.3 million to provide customer support services in situations in which the volume of such requests exceeded the Company's handling capacity. Finally, the Company paid AT&T approximately $176,000 for various services provided by AT&T, including engineering and design services and cell site rentals. All such agreements and arrangements between the Company and McCaw or AT&T are on terms that the Company believes are as or more favorable to it than would have been obtained with an unrelated third party. On June 19, 1992, the Company, McCaw and certain other parties received court approval of a Stipulation of Settlement setting forth terms by which shareholder litigation in the United States District Court for the Southern District of New York (Katz v. Pels) would be settled and shareholder litigation in the Delaware Court of Chancery for New Castle County (In re LIN Broadcasting Corp. Shareholders Litigation) would be dismissed. Such litigation arose out of the transactions related to the 26 acquisition by McCaw in 1990 of a majority of the Common Stock. Under the terms of the settlement, the Company received from McCaw payments of $1.35 million in July 1992 and $2 million on each of June 30, 1993 and 1994 and will receive from McCaw a further payment of $2 million on June 30, 1995. McCaw was also required to transfer to the Company approximately a 2% interest in the Galveston, Texas cellular market. Relationship With LIN Television Corporation On December 28, 1994 (the "Spin-off Date"), the Company distributed to the holders of its Common Stock of record on December 9, 1994 (the "Record Date"), all of the outstanding common stock, $.01 par value, of the Company's subsidiary, LIN Television. The distribution (the "Television Spin-off") was made in the form of a stock dividend of one share of the common stock of LIN Television (the "LIN Television Common Stock") for every two shares of the Company's Common Stock held on the Record Date. The Company did not receive any shares of LIN Television Common Stock in respect of the Company's Common Stock held by the Company as treasury shares. The "ex-distribution" date for the Television Spin-off, as established by the Nasdaq National Market, was December 29, 1994. Fractional shares of LIN Television Common Stock to which holders of the Company's Common Stock would have been entitled as a result of the Television Spin-off have been aggregated and sold, and the cash proceeds distributed to the record holders entitled thereto. The Internal Revenue Service has ruled that receipt of shares of LIN Television Common Stock in the Television Spin-off will not result in the recognition of income, gain or loss for federal income tax purposes (except with respect to any cash received in lieu of a fractional share interest in LIN Television Common Stock). Also on December 28, 1994, pursuant to the Asset Purchase Agreement, dated June 7, 1994, as amended, among the Company, LIN Television, Cook Inlet Communications, Inc., an Alaska corporation, and Cook Inlet Communications Corp., a Delaware corporation ("CICC"), LIN Television acquired substantially all the assets and assumed certain liabilities of WTNH-TV, New Haven-Hartford, Connecticut, from CICC in exchange for $120,170,000 in cash and approximately 11.5% of the LIN Television Common Stock outstanding after giving effect to such issuance (together with the Television Spin-off, the "Transaction"). The cash portion of the purchase price is subject to post-closing adjustment. Following the Transaction, approximately 42.3% of the LIN Television Common Stock was publicly owned; approximately 11.5% was held by CICC; and approximately 46.3% was held indirectly by 27 McCaw. LIN Television Common Stock is quoted on the Nasdaq National Market. Six of the ten initial directors of LIN Television were designated by McCaw, and three of them currently are officers of one or more of AT&T, McCaw and the Company. In addition, all of the Independent Directors also serve as directors of LIN Television. In connection with the Television Spin-off, the Company and LIN Television entered into a number of agreements, including: a Distribution Agreement, which provides for, among other things, the principal corporate transactions required to effect the Television Spin-off and certain other agreements governing the relationship between the Company and LIN Television; a Tax Allocation Agreement, which provides for the allocation between the Company and LIN Television of responsibilities, liabilities and benefits relating to or affecting taxes paid or payable by either of them or their respective subsidiaries for all taxable periods before and after the Television Spin-off; a Management Services Agreement, pursuant to which the Company and LIN Television will each provide to the other, upon request and for up to one year after the Television Spin-off, certain corporate administrative services, such as tax, treasury and legal services; and an Employee Benefits Allocation Agreement, which provides for the treatment of outstanding options to purchase the Company's Common Stock granted under the 1969 Plan and certain other matters, including the allocation of retirement, medical, disability and other employee welfare and benefit plans between the Company and LIN Television. LIN Television and certain subsidiaries of the Company also entered into a Consulting Agreement, pursuant to which LIN Television will provide management and operational consulting for the television broadcasting operations retained by the Company after the Television Spin-off, and a Right of First Refusal Agreement, pursuant to which, in the event that the Company receives and wishes to accept an offer to purchase assets associated with the Company's television broadcasting operations, LIN Television has the right to purchase such assets at the offered price. Prior to the Television Spin-off, the Company and McCaw allocated to LIN Television each year a portion of the expenses relating to certain corporate-level services, such as tax, treasury and legal services, provided to LIN Television by the Company and McCaw. LIN Television's portion of such expenses was determined based on its revenues, wages and properties relative to those of the Company and McCaw. The amount allocated to LIN Television for the portion of 1994 preceding the Television Spin-off was approximately $1.8 million. Due to limitations imposed 28 under LIN Television's credit facility on payments by LIN Television to its affiliates, LIN Television paid approximately $578,000 of such amount in cash, with the forgiveness of the balance of this expense being treated for accounting purposes as a contribution to capital by the Company. As a result of the separation of the Company and LIN Television pursuant to the Television Spin-off, these allocations ceased on December 28, 1994. Similarly, LIN Television provided certain corporate-level services, consisting primarily of general and administrative and accounting services, to the Company with respect to the television broadcasting operations conducted by the Company other than through LIN Television. The amount charged to the Company and its subsidiaries for these services in 1994 was approximately $494,000. Any such services provided in the future will be provided only through the Consulting Agreement described above or through such other agreements or arrangements as may be established by the parties. During the portion of 1994 ending on the Spin-off Date, the Company was a party to a tax-sharing agreement with LIN Television and its subsidiaries pursuant to which LIN Television was included in the consolidated federal income tax return filed by the Company. Pursuant to this agreement, LIN Television's allocated share of the Company's current consolidated federal income tax expense in 1994 is estimated to be approximately $22.7 million. This agreement further provided that LIN Television was treated as if it had certain net operating loss carryforwards, as a result of which LIN Television's share of the federal tax expense has been forgiven. The forgiveness of this expense has been treated for accounting purposes as a contribution to capital by the Company. During 1994, LIN Television provided to AT&T and its subsidiaries, including McCaw, advertising time worth approximately $1.5 million. The Company believes that the terms of all such transactions were at least as favorable as those that would result from arm's-length negotiations. 29 PART IV Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K (a)(1) Financial Statements Filed** Report of Ernst & Young LLP, Independent Auditors Consolidated Financial Statements of the Company - Consolidated Balance Sheets at December 31, 1994 and 1993 - Consolidated Statements of Operations for the Years Ended December 31, 1994, 1993 and 1992 - Consolidated Statements of Stockholders' Equity (Deficit) for the Years Ended December 31, 1994, 1993 and 1992 - Consolidated Statements of Cash Flows for the Years Ended December 31, 1994, 1993 and 1992 - Notes to Consolidated Financial Statements Report of Ernst & Young LLP, Independent Auditors Independent Auditors' Report Report of Independent Public Accountants Combined Financial Statements of the Company's Unconsolidated Affiliates - Combined Balance Sheets at December 31, 1994 and 1993 - Combined Statements of Income for the Years Ended December 31, 1994, 1993 and 1992 - Combined Statements of Ventures' Equity for the Years Ended December 31, 1994, 1993 and 1992 - Combined Statements of Cash Flows for the Years Ended December 31, 1994, 1993 and 1992 - Notes to the Combined Financial Statements (a)(2) Financial Statement Schedules Filed** Financial Statement Schedules of the Company I - Condensed Financial Information of Registrant II - Valuation and Qualifying Accounts and Reserves for the Years Ended December 31, 1994, 1993 and 1992 - -------------------- ** Previously filed. 30 Financial Statement Schedule of the Company's Unconsolidated Affiliates II - Valuation and Qualifying Accounts and Reserves for the Years Ended December 31, 1994, 1993 and 1992 All other schedules have been omitted because the information is not required or is not applicable, or because the information required is included in the financial statements or the notes thereto. (a)(3) Exhibits** 2.1 Agreement and Plan of Merger By and Among McCaw Cellular Communications, Inc., MMM Holdings, Inc., MMM Acquisition Corp. and LIN Broadcasting Corporation dated April 28, 1995 (filed herewith). 3.1 Restated Certificate of Incorporation of LIN Broadcasting Corporation (incorporated by reference to Exhibit 3.1 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 3.2 Amended and Restated By Laws. 10.1* Amended and Restated 1969 Stock Option Plan (incorporated by reference to Appendix A to the Company's Proxy Statement for the Annual Meeting of Stockholders held on June 2, 1994) 10.2(a)* Profit Sharing Plan, as amended and restated effective January 1, 1989 (the "Profit Sharing Plan") (incorporated by reference to Exhibit 10.2 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.2(b)* Amendment, adopted November 22, 1994, to the Profit Sharing Plan 10.3* Deferred Compensation Plan, as amended (incorporated by reference to Exhibit 10(d) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1989) 10.4 Partnership Agreement, dated as of March 18, 1983, among LIN Cellular Communications Corporation, Metromedia, Inc., and Cellular Systems, Inc. (incorporated by reference to Exhibit 10.11 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) - ------------------- ** Previously filed (except as noted). 31 10.5 Partnership Agreement, dated as of June 22, 1983, between Los Angeles Cellular Corporation and LIN Cellular Communications Corporation (incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.6 Stock Agreement, dated June 5, 1982, by and among Radio Broadcasting Company, LIN Broadcasting Corporation, LIN Cellular Communications Corporation, Metromedia, Inc., and AWACS, Inc. (incorporated by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.7 Amended and Restated Partnership Agreement, dated as of November 9, 1984, among LIN Cellular Communications Corporation, D/FW Signal, Inc., MCI Cellular Telephone Company, Cellular Mobile Systems, Inc., and Mid-America Cellular Systems, Inc. (incorporated by reference to Exhibit 10.14 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.8 Amended and Restated Partnership Agreement, dated as of December 12, 1984, among Metro Mobile CTS, Cellular Systems, Inc., and Houston Mobile Cellular Communications Company (incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.9 Partnership Agreement, dated as of December 12, 1984, among American Mobile Communications of Houston and the Gulf, Houston Cellular Corporation, LIN Cellular Communications Corporation, MCI Cellular Telephone Company, Charisma Communications Corp. of the Southwest, and Cellular Mobile Systems of Texas, Inc. (incorporated by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.10 Partnership Agreement, dated as of September 1991, by and between Galveston Mobile Corporation and LIN Cellular Communications Corporation (incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 32 10.11 Agreement, dated December 11, 1989, between the Company, MMM Holdings, Inc. and McCaw Cellular Communications, Inc. (incorporated by reference to Exhibit (c)(6) to Amendment No. 24 to Schedule 14D-1 and Amendment No. 30 to Schedule 13D relating to the Offer filed by MMM Holdings, Inc. and McCaw with the Securities and Exchange Commission on December 12, 1989) 10.12(a) Private Market Value Guarantee, dated December 11, 1989, between the Company and McCaw Cellular Communications, Inc. (the "Private Market Value Guarantee") (incorporated by reference to Exhibit (c)(7) to Amendment No. 24 to Schedule 14D-1 and Amendment No. 30 to Schedule 13D relating to the Offer filed by MMM Holdings, Inc. and McCaw with the Securities and Exchange Commission on December 12, 1989) 10.12(b) First Amendment, dated June 7, 1994, to the Private Market Value Guarantee (incorporated by reference to Exhibit 99.1 to the Company's Report on Form 8-K dated May 25, 1994) 10.13 Exercise, dated October 27, 1989, of the Company's Rights of First Refusal to Acquire the Interests of Metromedia Company in Metro One Cellular Telephone Company, and Agreement of Purchase and Sale, dated October 3, 1989, by and between McCaw Cellular Communications, Inc. and Metromedia Company (incorporated by reference to Exhibit 10(u) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1989) 10.14(a) Credit Agreement, dated as of August 1, 1990, among LIN Cellular Network, Inc., Morgan Guaranty Trust Company of New York and the Lenders Named therein (the "1990 Credit Agreement") (incorporated by reference to Exhibit 10.21 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1990) 10.14(b) Amendment No. 1, dated as of June 15, 1993, to the 1990 Credit Agreement 10.14(c) Amendment No. 2, dated as of May 31, 1994, to the 1990 Credit Agreement 33 10.15 Stock Acquisition Agreement, dated as of May 7, 1990, between LCH Cellular, Inc. and Metromedia Company (incorporated by reference to Exhibit (b)(i) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1990) 10.16 Restated Certificate of Incorporation of LCH Communications, Inc. (formerly LCH Cellular, Inc.) (incorporated by reference to Exhibit (b)(ii) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1990) 10.17 Stockholders Agreement, dated as of August 10, 1990, among Metromedia Company, LCH Holdings, Inc. and LCH Communications, Inc. (incorporated by reference to Exhibit (b)(iii) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1990) 10.18(a)* Employee Stock Purchase Plan (the "ESPP") (incorporated by reference to Exhibit 4.3 to the Company's Registration Statement on Form S-8 dated March 13, 1991 (Registration No. 33-39282)) 10.18(b)* Amendment, adopted November 2, 1994, to the ESPP 10.19* Employment Agreement, dated as of October 17, 1990 of Gary Chapman (incorporated by reference to Exhibit 10.28 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991) 10.20* Employment Agreement, dated as of April 16, 1991, of Donald Guthrie (incorporated by reference to Exhibit 10.30 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991) 10.21(a)* LIN Broadcasting Corporation Retirement Plan (the "Retirement Plan"), as amended and restated as of January 1, 1989 (incorporated by reference to Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991). 10.21(b)* Amendment to the Retirement Plan dated January 1, 1993 (incorporated by reference to Exhibit 10.32 to the Company's Annual Report on Form 10-K for the year ended December 31, 1992) 10.21(c)* Amendment, adopted November 22, 1994, to the Retirement Plan 34 10.22(a)* LIN Broadcasting Corporation Supplemental Benefit Retirement Plan dated January 1, 1990 (the "Supplemental Plan") (incorporated by reference to Exhibit 10.33 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.22(b)* Amendment, adopted November 22, 1994, to the Supplemental Plan 10.23* LIN Employee Plans, established in connection with the McCaw-AT&T Merger Agreement (incorporated by reference to Exhibit 10.34 to the Company's Annual Report on Form 10-K for the year ended December 31, 1993) 10.24* LIN Broadcasting Deferred Compensation Plan, dated December 15, 1993 (incorporated by reference to Exhibit 10.35 to the Company's Annual Report on Form 10-K for the year ended December 31, 1993) 10.25 Distribution Agreement, dated as of December 28, 1994, between the Company and LIN Television Corporation ("LIN TV") (incorporated by reference to Exhibit 2.4 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.26 Tax Allocation Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.1 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.27 Management Services Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.2 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.28 Employee Benefits Allocation Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.3 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.29 Consulting Agreement, dated as of December 28, 1994, between LIN TV, LCH Communications, Inc. and LIN Michigan Broadcasting Corporation (incorporated by reference to Exhibit 99.4 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 35 10.30 Right of First Refusal Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.5 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.31(a) Asset Purchase Agreement, dated June 7, 1994 among the Company, LIN TV, Cook Inlet Communications Corp. and Cook Inlet Communications, Inc. (the "Asset Purchase Agreement") (incorporated by reference to Exhibit 99.1 to the Company's Report on Form 8-K dated December 28, 1994) 10.31(b) First Amendment, dated September 26, 1994. to the Asset Purchase Agreement (incorporated by reference to Exhibit 99.2 to the Company's Report on Form 8-K dated December 28, 1994) 10.31(c) Second Amendment, dated December 6, 1994. to the Asset Purchase Agreement (incorporated by reference to Exhibit 99.3 to the Company's Report on Form 8-K dated December 28, 1994) 10.32 Credit Agreement, dated as of June 15, 1994, among LIN Cellular Network, Inc., Toronto Dominion (Texas), Inc. and the Lenders named therein 11 Statement regarding computation of earnings per share 21 Subsidiaries of the Registrant 23.1 Consent of Ernst & Young LLP 23.2 Consent of Deloitte & Touche LLP 23.3 Consent of Arthur Andersen LLP 24 Powers of Attorney with respect to Certain Signatures 27 Financial Data Schedule * Management contract or compensatory plan or arrangement. 36 (b) Reports on Form 8-K A report on Form 8-K dated December 28, 1994 relating to the completion of the spin-off of LIN Television Corporation, as well as the selection of appraisers under the Private Market Value Guarantee process by the Independent Directors of the Company and AT&T, was filed dated December 28, 1994. SIGNATURE Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Amendment to be signed on its behalf by the undersigned, thereunto duly authorized. LIN BROADCASTING CORPORATION By: TOM A. ALBERG ----------------------- Tom A. Alberg President, Chief Operating Officer May 1, 1995 INDEX TO EXHIBITS Exhibit No. 2.1 Agreement and Plan of Merger By and Among McCaw Cellular Communications, Inc., MMM Holdings, Inc., MMM Acquisition Corp. and LIN Broadcasting Corporation dated April 28, 1995 (filed herewith). 3.1 Restated Certificate of Incorporation of LIN Broadcasting Corporation (incorporated by reference to Exhibit 3.1 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 3.2 Amended and Restated By Laws. 10.1* Amended and Restated 1969 Stock Option Plan (incorporated by reference to Appendix A to the Company's Proxy Statement for the Annual Meeting of Stockholders held on June 2, 1994) 10.2(a)* Profit Sharing Plan, as amended and restated effective January 1, 1989 (the "Profit Sharing Plan") (incorporated by reference to Exhibit 10.2 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.2(b)* Amendment, adopted November 22, 1994, to the Profit Sharing Plan 10.3* Deferred Compensation Plan, as amended (incorporated by reference to Exhibit 10(d) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1989) 10.4 Partnership Agreement, dated as of March 18, 1983, among LIN Cellular Communications Corporation, Metromedia, Inc., and Cellular Systems, Inc. (incorporated by reference to Exhibit 10.11 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.5 Partnership Agreement, dated as of June 22, 1983, between Los Angeles Cellular Corporation and LIN Cellular Communications Corporation (incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.6 Stock Agreement, dated June 5, 1982, by and among Radio Broadcasting Company, LIN Broadcasting Corporation, LIN Cellular Communications Corporation, Metromedia, Inc., and AWACS, Inc. (incorporated by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.7 Amended and Restated Partnership Agreement, dated as of November 9, 1984, among LIN Cellular Communications Corporation, D/FW Signal, Inc., MCI Cellular Telephone Company, Cellular Mobile Systems, Inc., and Mid-America Cellular Systems, Inc. (incorporated by reference to Exhibit 10.14 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.8 Amended and Restated Partnership Agreement, dated as of December 12, 1984, among Metro Mobile CTS, Cellular Systems, Inc., and Houston Mobile Cellular Communications Company (incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.9 Partnership Agreement, dated as of December 12, 1984, among American Mobile Communications of Houston and the Gulf, Houston Cellular Corporation, LIN Cellular Communications Corporation, MCI Cellular Telephone Company, Charisma Communications Corp. of the Southwest, and Cellular Mobile Systems of Texas, Inc. (incorporated by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.10 Partnership Agreement, dated as of September 1991, by and between Galveston Mobile Corporation and LIN Cellular Communications Corporation (incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.11 Agreement, dated December 11, 1989, between the Company, MMM Holdings, Inc. and McCaw Cellular Communications, Inc. (incorporated by reference to Exhibit (c)(6) to Amendment No. 24 to Schedule 14D-1 and Amendment No. 30 to Schedule 13D relating to the Offer filed by MMM Holdings, Inc. and McCaw with the Securities and Exchange Commission on December 12, 1989) 10.12(a) Private Market Value Guarantee, dated December 11, 1989, between the Company and McCaw Cellular Communications, Inc. (the "Private Market Value Guarantee") (incorporated by reference to Exhibit (c)(7) to Amendment No. 24 to Schedule 14D-1 and Amendment No. 30 to Schedule 13D relating to the Offer filed by MMM Holdings, Inc. and McCaw with the Securities and Exchange Commission on December 12, 1989) 10.12(b) First Amendment, dated June 7, 1994, to the Private Market Value Guarantee (incorporated by reference to Exhibit 99.1 to the Company's Report on Form 8-K dated May 25, 1994) 10.13 Exercise, dated October 27, 1989, of the Company's Rights of First Refusal to Acquire the Interests of Metromedia Company in Metro One Cellular Telephone Company, and Agreement of Purchase and Sale, dated October 3, 1989, by and between McCaw Cellular Communications, Inc. and Metromedia Company (incorporated by reference to Exhibit 10(u) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1989) 10.14(a) Credit Agreement, dated as of August 1, 1990, among LIN Cellular Network, Inc., Morgan Guaranty Trust Company of New York and the Lenders Named therein (the "1990 Credit Agreement") (incorporated by reference to Exhibit 10.21 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1990) 10.14(b) Amendment No. 1, dated as of June 15, 1993, to the 1990 Credit Agreement 10.14(c) Amendment No. 2, dated as of May 31, 1994, to the 1990 Credit Agreement 10.15 Stock Acquisition Agreement, dated as of May 7, 1990, between LCH Cellular, Inc. and Metromedia Company (incorporated by reference to Exhibit (b)(i) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1990) 10.16 Restated Certificate of Incorporation of LCH Communications, Inc. (formerly LCH Cellular, Inc.) (incorporated by reference to Exhibit (b)(ii) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1990) 10.17 Stockholders Agreement, dated as of August 10, 1990, among Metromedia Company, LCH Holdings, Inc. and LCH Communications, Inc. (incorporated by reference to Exhibit (b)(iii) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1990) 10.18(a)* Employee Stock Purchase Plan (the "ESPP") (incorporated by reference to Exhibit 4.3 to the Company's Registration Statement on Form S-8 dated March 13, 1991 (Registration No. 33-39282)) 10.18(b)* Amendment, adopted November 2, 1994, to the ESPP 10.19* Employment Agreement, dated as of October 17, 1990 of Gary Chapman (incorporated by reference to Exhibit 10.28 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991) 10.20* Employment Agreement, dated as of April 16, 1991, of Donald Guthrie (incorporated by reference to Exhibit 10.30 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991) 10.21(a)* LIN Broadcasting Corporation Retirement Plan (the "Retirement Plan"), as amended and restated as of January 1, 1989 (incorporated by reference to Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991). 10.21(b)* Amendment to the Retirement Plan dated January 1, 1993 (incorporated by reference to Exhibit 10.32 to the Company's Annual Report on Form 10-K for the year ended December 31, 1992) 10.21(c)* Amendment, adopted November 22, 1994, to the Retirement Plan 10.22(a)* LIN Broadcasting Corporation Supplemental Benefit Retirement Plan dated January 1, 1990 (the "Supplemental Plan") (incorporated by reference to Exhibit 10.33 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1992) 10.22(b)* Amendment, adopted November 22, 1994, to the Supplemental Plan 10.23* LIN Employee Plans, established in connection with the McCaw-AT&T Merger Agreement (incorporated by reference to Exhibit 10.34 to the Company's Annual Report on Form 10-K for the year ended December 31, 1993) 10.24* LIN Broadcasting Deferred Compensation Plan, dated December 15, 1993 (incorporated by reference to Exhibit 10.35 to the Company's Annual Report on Form 10-K for the year ended December 31, 1993) 10.25 Distribution Agreement, dated as of December 28, 1994, between the Company and LIN Television Corporation ("LIN TV") (incorporated by reference to Exhibit 2.4 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.26 Tax Allocation Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.1 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.27 Management Services Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.2 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.28 Employee Benefits Allocation Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.3 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.29 Consulting Agreement, dated as of December 28, 1994, between LIN TV, LCH Communications, Inc. and LIN Michigan Broadcasting Corporation (incorporated by reference to Exhibit 99.4 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.30 Right of First Refusal Agreement, dated as of December 28, 1994, between the Company and LIN TV (incorporated by reference to Exhibit 99.5 to the Report on Form 8-K dated December 28, 1994 filed by LIN Television Corporation) 10.31(a) Asset Purchase Agreement, dated June 7, 1994 among the Company, LIN TV, Cook Inlet Communications Corp. and Cook Inlet Communications, Inc. (the "Asset Purchase Agreement") (incorporated by reference to Exhibit 99.1 to the Company's Report on Form 8-K dated December 28, 1994) 10.31(b) First Amendment, dated September 26, 1994. to the Asset Purchase Agreement (incorporated by reference to Exhibit 99.2 to the Company's Report on Form 8-K dated December 28, 1994) 10.31(c) Second Amendment, dated December 6, 1994. to the Asset Purchase Agreement (incorporated by reference to Exhibit 99.3 to the Company's Report on Form 8-K dated December 28, 1994) 10.32 Credit Agreement, dated as of June 15, 1994, among LIN Cellular Network, Inc., Toronto Dominion (Texas), Inc. and the Lenders named therein 11 Statement regarding computation of earnings per share 21 Subsidiaries of the Registrant 23.1 Consent of Ernst & Young LLP 23.2 Consent of Deloitte & Touche LLP 23.3 Consent of Arthur Andersen LLP 24 Powers of Attorney with respect to Certain Signatures 27 Financial Data Schedule EX-2 2 AGREEMENT AND PLAN OF MERGER BY AND AMONG MCCAW CELLULAR COMMUNICATIONS, INC., MMM HOLDINGS, INC., MMM ACQUISITION CORP. AND LIN BROADCASTING CORPORATION Dated April 28, 1995 TABLE OF CONTENTS ARTICLE I 1. Definitions.... . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE II 2. The Merger; Terms of the Merger . . . . . . . ............... 4 2.1. The Merger . . . . . . . . . . . . . . . . . . . . . . . 4 2.2. Effective Time . . . . . . ............................. 5 2.3. Closing. . . . . . . . . . . . . . . . . . . . . . . . . 5 2.4. Certificate of Incorporation . . . . . . . . . . . . . . 5 2.5. The By-Laws. . . . . . . . . . . . . . . . . . . . . . . 5 2.6. Directors. . . . . . . . . . . . . . . . . . . . . . . . 5 2.7. Officers . . . . . . . . . . . . . . . . . . . . . . . . 5 ARTICLE III 3. Conversion of Shares; Option Plan; Stockholders Meeting. . . . . . . . . . . . . . . . . . . . 6 3.1. Merger Consideration; Conversion or Cancellation of Shares in the Merger . . . . . . . . . 6 3.2. Option Plan; Stock Purchase Plan . . . . . . . . . . . . 6 3.3. Stockholders' Meeting. . . . . . . . . . . . . . . . . . 8 ARTICLE IV 4. Dissenting Shares; Payment for Shares . . . . . . . . . . . . 9 4.1. Dissenting Shares. . . . . . . . . . . . . . . . . . . . 9 4.2. Payment for Shares . . . . . . . . . . . . . . . . . . . 9 ARTICLE V 5. Representations and Warranties of LIN . . . . . . . . . . . . 11 5.1. Organization, Etc. of LIN. . . . . . . . . . . . . . . . 11 5.2. Operations of Subsidiaries . . . . . . . . . . . . . . . 11 5.3. Agreement. . . . . . . . . . . . . . . . . . . . . . . . 12 5.4. Capital Stock. . . . . . . . . . . . . . . . . . . . . . 12 5.5. Brokers and Finders. . . . . . . . . . . . . . . . . . . 12 5.6. Proxy Statement. . . . . . . . . . . . . . . . . . . . . 13 5.7. Delaware Section 203 . . . . . . . . . . . . . . . . . . 13 5.8. Rights Agreement . . . . . . . . . . . . . . . . . . . . 13 ARTICLE VI 6. Representations and Warranties of McCaw, Holdings and Merger Sub. . . . . . . . . . . . . . . . . . . . . . . 14 6.1. Organization, Etc. of McCaw, Holdings and Merger Sub . . . . . . . . . . . . . . . . . . . . 14 6.2. Agreement. . . . . . . . . . . . . . . . . . . . . . . . 14 6.3. Brokers and Finders. . . . . . . . . . . . . . . . . . . 14 6.4. Proxy Statement. . . . . . . . . . . . . . . . . . . . . 14 6.5. No Prior Activities. . . . . . . . . . . . . . . . . . . 15 6.6. Solvency . . . . . . . . . . . . . . . . . . . . . . . . 15 ARTICLE VII 7. Additional Covenants and Agreements . . . . . ............... 15 7.1. Conduct of Business of LIN . . . . . . . . . . . . . . . 15 7.2. Reasonable Efforts . . . . . . . . . . . ............... 16 7.3. Indemnification; Insurance . . . . . . . . . . . . . . . 16 7.4. New York Real Property Gains and Transfer Tax . . . . . . . . . . . . . . . . . . . . 17 ARTICLE VIII 8. Conditions. . . . . . . . . . . . . . . . . . . . . . . . . . 17 8.1. Conditions to Each Party's Obligations . . . . . . . . . 17 8.2. Conditions to Obligations of McCaw, Holdings and Merger Sub . . . . . . . . . . . . . . . . . . . . 18 8.3. Conditions to Obligations of LIN . . . . . . . . . . . . 19 ARTICLE IX 9. Termination, Amendment and Waiver . . . . . . . . . . . . . . 19 9.1. Termination by Mutual Consent. . . . . . . . . . . . . . 19 9.2. Termination by Either McCaw or LIN . . . . . . . . . . . . . . . . . . . . . . . . 19 9.3. Amendment. . . . . . . . . . . . . . . . . . . . . . . . 20 9.4. Extension; Waiver. . . . . . . . . . . . . . . . . . . . 20 9.5. Effect of Termination and Abandonment. . . . . . . . . . 20 ARTICLE X 10. Miscellaneous and General . . . . . . . . . . ............... 21 10.1. Expenses . . . . . . . . . . . . . . . . . . . . . . . 21 10.2. Notices, Etc.. . . . . . . . . . . . . . . . . . . . . 21 10.3. Nonsurvival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . 22 10.4. No Assignment. . . . . . . . . . . . . . . . . . . . . 22 10.5. Entire Agreement . . . . . . . . . . . . . . . . . . . 22 10.6. Specific Performance . . . . . . . . . . . . . . . . . 23 10.7. Remedies Cumulative. . . . . . . . . . . . . . . . . . 23 10.8. No Waiver. . . . . . . . . . . . . . . . . . . . . . . 23 10.9. No Third Party Beneficiaries . . . . . . . . . . . . . 23 10.10. Public Announcements . . . . . . . . . . . . . . . . . 23 10.11. Certain Actions by LIN . . . . . . . . . . . . . . . . 23 10.12. Governing Law. . . . . . . . . . . . . . . . . . . . . 24 10.13. Name, Captions, Etc. . . . . . . . . . . . . . . . . . 24 10.14. Counterparts . . . . . . . . . . . . . . . . . . . . . 24 10.15. McCaw Guarantee. . . . . . . . . . . . . . . . . . . . 24 Exhibit A -- Private Market Value Guarantee, as amended AGREEMENT AND PLAN OF MERGER AGREEMENT AND PLAN OF MERGER (hereinafter called this "Agreement"), dated April 28, 1995, by and among McCaw Cellular Communications, Inc., a Delaware corporation ("McCaw"), MMM Holdings, Inc., a Delaware corporation and a direct Wholly Owned Subsidiary of McCaw ("Holdings"), MMM Acquisition Corp., a Delaware corporation and a direct Wholly Owned Subsidiary of Holdings ("Merger Sub"), and LIN Broadcasting Corporation, a Delaware corporation ("LIN"). RECITALS WHEREAS, McCaw and Holdings are the beneficial owners of approximately 52% of the outstanding LIN Common Shares; WHEREAS, pursuant to and in accordance with the terms of the PMVG, the Private Market Price has been set at $127.50 per LIN Common Share; WHEREAS, pursuant to and in accordance with the terms of the PMVG, McCaw has determined that it desires to proceed with an acquisition of the LIN Public Shares at the Private Market Price, on the terms and subject to the conditions set forth in this Agreement; WHEREAS, the Boards of Directors of McCaw, Holdings, Merger Sub and LIN each have determined that it is in the best interests of their respective stockholders for Merger Sub to merge with and into LIN, upon the terms and subject to the conditions set forth in this Agreement; and WHEREAS, McCaw, Holdings, Merger Sub and LIN desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also to prescribe various conditions to the Merger. NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and agreements set forth herein, McCaw, Holdings, Merger Sub and LIN hereby agree as follows: ARTICLE I DEFINITIONS As used in this Agreement, the following terms shall have the respective meanings set forth below: "Affiliate": As defined in Rule 12b-2 under the Exchange Act. "Agreement": As defined in the preamble hereto. "Assumption Ratio": As defined in Section 3.2(a). "AT&T": AT&T Corp., a New York corporation. "AT&T Common Shares": Shares of common stock, $1.00 par value per share, of AT&T. "Authorization": Any consent, approval or authorization of, or any expiration or termination of any waiting period requirement (including pursuant to the HSR Act) of, or any filing, registration, qualification, declaration or designation with or by, any Governmental Body. "Certificate of Merger": The certificate of merger with respect to the Merger, containing the provisions required by, and executed in accordance with, Section 251 of the DGCL. "Certificates": As defined in Section 4.2. "Closing": The closing of the Merger. "Closing Date": The date on which the Closing occurs. "Code": The Internal Revenue Code of 1986, as amended, and all regulations promulgated thereunder, as in effect from time to time. "DGCL": The Delaware General Corporation Law. "Dissenting Shares": As defined in Section 4.1. "Effective Time": As defined in Section 2.2. "Exchange Act": The Securities Exchange Act of 1934, as amended. "FCC": The Federal Communications Commission. "Governmental Body": Any Federal, state, municipal, political subdivision or other governmental department, authority, commission, board, bureau, agency or instrumentality, domestic or foreign. "HSR Act": The Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. "Holdings": As defined in the preamble to this Agreement. "Indemnified Parties": As defined in Section 7.3(a). "LIN": As defined in the preamble to this Agreement. "LIN Board": The board of directors of LIN. "LIN Common Shares": Shares of common stock, par value $0.01 per share, of LIN; "LIN Independent Directors": The three members of the LIN Board designated as Independent Directors pursuant to and in accordance with Section 1 of the PMVG. "LIN Public Shares": LIN Common Shares not owned by McCaw or any of its affiliates or any member of a "group", as such term is used for purposes of Schedule 13D under the Exchange Act, of which McCaw or its affiliates are members with respect to securities of LIN. "McCaw": As defined in the preamble to this Agreement. "Merger": The merger of Merger Sub with and into LIN as contemplated by Section 2.1. "Merger Consideration": As defined in Section 3.1(a). "Merger Sub": As defined in the preamble to this Agreement. "NASDAQ": The National Association of Securities Dealers Automated Quotations System. "NYSE": The New York Stock Exchange, Inc. "Options": As defined in Section 3.2. "Option Plan": As defined in Section 3.2. "PMVG": The Private Market Value Guarantee, dated December 11, 1989, as amended, between McCaw and LIN, attached hereto as Exhibit A. "Paying Agent": As defined in Section 4.2. "Person": Any individual or corporation, company, partnership, trust, incorporated or unincorporated association, joint venture or other entity of any kind. "Private Market Price": The private market price per LIN Common Share determined pursuant to Section 2(C) of the PMVG. "Proxy Statement": As defined in Section 3.3. "Rights": The Preferred Share Purchase Rights issued pursuant to the Rights Agreement. "Rights Agreement": The Rights Agreement, dated as of May 2, 1988, as amended and restated as of January 13, 1989 and June 19, 1989 and as subsequently further amended, between LIN and Manufacturers Hanover Trust Company, as Rights Agent. "Schedule 13E-3": The Transaction Statement on Schedule 13E-3 to be filed under the Exchange Act by AT&T, McCaw, Holdings, Merger Sub and LIN with respect to the Merger. "SEC": The Securities and Exchange Commission. "Significant Subsidiary": As defined under Rule 12b-1 of the Exchange Act. "Solvent": As defined in Section 6.6. "Stock Purchase Plan": As defined in Section 3.2(c). "Stockholders Meeting": As defined in Section 3.3. "Subsidiary": As to any Person, any other Person of which at least 50% of the equity or voting interest is owned, directly or indirectly, by such first Person. "Surviving Corporation": The surviving corporation in the Merger. "Wholly Owned Subsidiary": A Subsidiary of which 100% of the equity interest is owned, directly or indirectly, by the parent company. ARTICLE II THE MERGER; TERMS OF THE MERGER 2.1. The Merger. Subject to the terms and conditions of this Agreement, at the Effective Time, Merger Sub shall be merged with and into LIN in accordance with the provisions of Section 251 of the DGCL and with the effect provided in Sections 259 and 261 of the DGCL. The separate corporate existence of Merger Sub shall thereupon cease and LIN shall be the Surviving Corporation and shall continue to be governed by the laws of the State of Delaware. At the election of McCaw, any Wholly Owned Subsidiary of McCaw may be substituted for Merger Sub as a constituent corporation in the Merger, provided that the parties shall have executed an appropriate amendment to this Agreement in accordance with Section 9.3 in form and substance reasonably satisfactory to LIN and McCaw in order to reflect such substitution. 2.2. Effective Time. The Merger shall become effective on the date and at the time (the "Effective Time") that the Certificate of Merger shall have been accepted for filing by the Secretary of State of the State of Delaware (or such later date and time as may be specified, with the approval of LIN and McCaw, in the Certificate of Merger). 2.3. Closing. Unless this Agreement shall have been terminated and the transactions contemplated shall have been abandoned pursuant to Section 9.1 or 9.2 and subject to the fulfillment or waiver of the conditions set forth in Article VIII, the Closing shall take place (i) at the offices of Wachtell, Lipton, Rosen & Katz, New York, New York, as promptly as practicable (but in any event within three business days) following satisfaction of the condition set forth in Section 8.1(a) or (ii) at such other place and/or time and/or on such other date as McCaw and LIN may agree or as may be necessary to permit the fulfillment or waiver of the other conditions set forth in Article VIII. The parties hereto shall use all reasonable efforts to cause the Certificate of Merger to be filed with the Secretary of State of the State of Delaware on the Closing Date or as soon as practicable thereafter. 2.4. Certificate of Incorporation. The Certificate of Incorporation of Merger Sub as in effect immediately prior to the Effective Time shall be the Certificate of Incorporation of the Surviving Corporation, until duly amended in accordance with the terms thereof and of the DGCL, except that Article SECOND thereof shall be amended to read as follows: "The name of the Corporation (which is hereinafter called the "Corporation") is LIN Broadcasting Corporation." 2.5. The By-Laws. The By-Laws of Merger Sub in effect at the Effective Time shall be the By-Laws of the Surviving Corporation, until duly amended in accordance with the terms thereof, of the Certificate of Incorporation of the Surviving Corporation and of the DGCL. 2.6. Directors. The directors of Merger Sub at the Effective Time shall, from and after the Effective Time, be the directors of the Surviving Corporation until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation's Certificate of Incorporation and By-Laws. 2.7. Officers. The officers of LIN at the Effective Time shall, from and after the Effective Time, be the officers of the Surviving Corporation until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation's Certificate of Incorporation and By-Laws. ARTICLE III CONVERSION OF SHARES; OPTION PLAN; STOCKHOLDERS MEETING 3.1. Merger Consideration; Conversion or Cancellation of Shares in the Merger. Subject to the provisions of this Article III, at the Effective Time, by virtue of the Merger and without any action on the part of the holders thereof, the shares of the constituent corporations shall be converted as follows: (a) Each LIN Common Share issued and outstanding immediately prior to the Effective Time (other than LIN Common Shares owned by McCaw or any of its Wholly Owned Subsidiaries and LIN Common Shares held in the treasury of LIN or by any Wholly Owned Subsidiary of LIN, which LIN Common Shares, by virtue of the Merger and without any action on the part of the holders thereof, shall be automatically cancelled and retired and shall cease to exist with no payment being made with respect thereto, and other than any Dissenting Shares) shall be converted into the right to receive $127.50 in cash, without interest thereon (the "Merger Consideration"), as set forth in Section 4.2 hereof. (b) Each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become one validly issued, fully paid and nonassessable share of Common Stock, par value $0.01 per share, of the Surviving Corporation. Section 3.2. Option Plan; Stock Purchase Plan. (a) Pursuant to the terms of the Amended and Restated 1969 Stock Option Plan of LIN (the "Option Plan"), each option to purchase LIN Common Shares outstanding at the Effective Time (each, an "Option") issued pursuant to the Option Plan shall be assumed by AT&T and shall constitute an option to acquire, on the same terms and conditions as were applicable under such assumed Option, a number of AT&T Common Shares equal to the product of the Assumption Ratio and the number of LIN Common Shares remaining subject to such Option as of the Effective Time, at a price per AT&T Common Share equal to the aggregate exercise price for the LIN Common Shares remaining subject to such Option divided by the number of full AT&T Common Shares deemed to be purchasable pursuant to such Option; provided, however, that (i) subject to the provisions of clause (ii) below, the number of AT&T Common Shares that may be purchased upon exercise of such Option shall not include any fractional shares and, upon the last such exercise of such Option, a cash payment shall be made for any fractional share based upon the per share closing price of AT&T Common Shares as reported in the NYSE Composite Transactions on the date of such exercise, and (ii) in the case of any Option to which Section 421 of the Code applies by reason of its qualification under Section 422 or Section 423 of the Code ("qualified stock options"), the option price, the number of shares purchasable pursuant to such Option and the terms and conditions of exercise of such Option shall be determined in order to comply with Section 424 of the Code. For purposes of the foregoing, the "Assumption Ratio" shall mean the per share closing price of the LIN Common Shares on the date of approval of the Merger by the LIN stockholders, as reported on NASDAQ, divided by the per share closing price of AT&T Common Shares on the date of approval of the Merger by the LIN stockholders, as reported in the NYSE Composite Transactions (or if such date is not a trading day, on the immediately preceding trading day). The Assumption Ratio will be adjusted appropriately, if necessary, to reflect any stock split, reverse stock split or similar change in the AT&T Common Shares or the LIN Common Shares that is not reflected in their respective per share closing prices on the date of approval of the Merger; provided that in no event will any such adjustment be made in respect of quarterly cash dividends payable on the AT&T Common Shares or the LIN Common Shares. (b) McCaw shall cause AT&T to take all corporate action necessary to reserve for issuance a sufficient number of AT&T Common Shares for delivery upon exercise of the Options assumed in accordance with Section 3.2(a). AT&T shall file a registration statement on Form S-8 (or any successor form) or another appropriate form, effective as of the Effective Time, with respect to AT&T Common Shares subject to such Options and shall use all reasonable efforts to maintain the effectiveness of such registration statement or registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as such Options remain outstanding. (c) LIN shall take such action as may be necessary so that, from and after the Effective Time, no employee of LIN shall be eligible to purchase LIN Common Shares pursuant to the LIN Broadcasting Corporation Employee Stock Purchase Plan (the "Stock Purchase Plan"). In lieu thereof, LIN employees who meet the eligibility requirements thereof will be eligible to purchase AT&T Common Shares pursuant to the McCaw Cellular Communications, Inc. Employee Stock Purchase Plan. (d) LIN shall take such action as may be necessary to ensure that, following the Effective Time, no holder of Options or any participant in the Option Plan, the Stock Purchase Plan or any other plans, programs or arrangements of LIN or any of its Subsidiaries shall have any right thereunder to acquire any equity securities of LIN, the Surviving Corporation or any Subsidiary thereof. Section 3.3. Stockholders' Meeting. (a) As promptly as practicable following the date hereof, LIN shall, in accordance with applicable law and its Certificate of Incorporation and By-Laws: (i) duly call, give notice of, convene and hold a special meeting of its stockholders (the "Stockholders Meeting") for the purpose of considering and taking action upon the Merger and this Agreement and such other matters as may be necessary to consummate the transactions contemplated herein; (ii) prepare and file with the SEC a preliminary proxy statement relating to the matters to be considered at the Stockholders Meeting pursuant to this Agreement and use its reasonable best efforts to obtain and furnish the information required to be included by the SEC in the Proxy Statement and, after consultation with McCaw, to respond promptly to any comments made by the SEC with respect to the preliminary proxy statement and to cause a definitive proxy statement (the "Proxy Statement") to be mailed to its stockholders; and (iii) subject to the fiduciary obligations of the LIN Board under applicable law as advised in writing by outside counsel selected by the LIN Board, include in the Proxy Statement the recommendation of the LIN Board that stockholders of LIN vote in favor of the approval of the Merger, the adoption of this Agreement and such other matters as may be necessary to consummate the transactions contemplated hereby. (b) McCaw agrees that, if the Merger is approved by the affirmative vote of at least a majority of the LIN Public Shares present and entitled to vote at the Stockholders Meeting pursuant to clause (ii) of Section 8.1(a), McCaw will vote, or cause to be voted, all of the LIN Common Shares beneficially owned by it, its affiliates or any of its Subsidiaries in favor of the approval of the Merger, the adoption of this Agreement and such other matters as may be necessary to consummate the transactions contemplated hereby. In addition, each of LIN, McCaw, Holdings and Merger Sub agrees that it will fully cooperate in the preparation of the Proxy Statement and the Schedule 13E-3. ARTICLE IV DISSENTING SHARES; PAYMENT FOR SHARES Section 4.1. Dissenting Shares. Notwithstanding anything in this Agreement to the contrary, LIN Common Shares outstanding immediately prior to the Effective Time and held by a holder (if any) who has not voted in favor of the Merger or consented thereto in writing and who has demanded appraisal for such LIN Common Shares in accordance with Section 262 of the DGCL ("Dissenting Shares") shall not be converted into the right to receive the Merger Consideration, as provided in Section 3.1 hereof, unless and until such holder fails to perfect or withdraws or otherwise loses his right to appraisal and payment under the DGCL. If, after the Effective Time, any such holder fails to perfect or withdraws or loses his right to appraisal, such Dissenting Shares shall thereupon be treated as if they had been converted as of the Effective Time into the right to receive the Merger Consideration to which such holder is entitled, without interest thereon. LIN shall give McCaw prompt notice of any demands received by LIN for appraisal of LIN Common Shares and McCaw shall have the right to participate in all negotiations and proceedings with respect to such demands. LIN shall not, except with the prior written consent of McCaw, make any payment with respect to, or settle or offer to settle, any such demands. Section 4.2. Payment for Shares. (a) From and after the Effective Time, a bank or trust company to be designated by McCaw shall act as paying agent (the "Paying Agent") in effecting the payment of the Merger Consideration for certificates (the "Certificates") formerly representing LIN Common Shares and entitled to payment of the Merger Consideration pursuant to Section 3.1. At the Effective Time, and from time to time thereafter, McCaw or Merger Sub shall deposit, or cause to be deposited, in trust with the Paying Agent for the benefit of the holders of LIN Common Shares such amounts as may be necessary to permit the Paying Agent to make the payments contemplated by paragraph (b) of this Section 4.2. (b) Promptly after the Effective Time, but in no event later than two business days after the date of the Effective Time, the Paying Agent shall mail to each record holder of Certificates that immediately prior to the Effective Time represented LIN Common Shares (other than Certificates representing LIN Common Shares held by McCaw, Holdings or Merger Sub, any Wholly Owned Subsidiary of McCaw, Holdings or Merger Sub, in the treasury of LIN or by any Wholly Owned Subsidiary of LIN) a form of letter of transmittal which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Paying Agent and instructions for use in surrendering such Certificates and receiving the Merger Consideration therefor. Upon the surrender of each such Certificate, together with such letter of transmittal duly executed and any other required documents, the Paying Agent shall pay the holder of such Certificate the Merger Consideration multiplied by the number of LIN Common Shares formerly represented by such Certificate, in consideration therefor, and such Certificate shall forthwith be cancelled. Until so surrendered, each such Certificate (other than Certificates representing Dissenting Shares and Certificates representing LIN Common Shares held by McCaw, Holdings or Merger Sub, any Wholly Owned Subsidiary of McCaw, Holdings or Merger Sub, in the treasury of LIN or by any Wholly Owned Subsidiary of LIN) shall represent solely the right to receive the aggregate Merger Consideration relating thereto. No interest shall be paid or accrued on the Merger Consideration. (c) Promptly following the date which is one year after the Effective Time, the Paying Agent shall deliver to McCaw all cash, Certificates and other documents in its possession relating to the transactions described in this Agreement, and the Paying Agent's duties shall terminate. Thereafter, each holder of a Certificate formerly representing a LIN Common Share (other than Certificates representing Dissenting Shares and Certificates representing LIN Common Shares held by McCaw, Holdings or Merger Sub, any Wholly Owned Subsidiary of McCaw, Holdings or Merger Sub, in the treasury of LIN or by any Wholly Owned Subsidiary of LIN) may surrender such Certificate to McCaw and (subject to applicable abandoned property, escheat and similar laws) receive in consideration therefor the aggregate Merger Consideration relating thereto, without any interest or dividends thereon. (d) The Merger Consideration shall be net to each holder of Certificates in cash, subject to reduction only for any applicable federal back-up withholding or stock transfer taxes payable by such holder. (e) If payment of cash in respect of any Certificate is to be made to a Person other than the Person in whose name such Certificate is registered, it shall be a condition to such payment that the Certificate so surrendered shall be properly endorsed or shall be otherwise in proper form for transfer and that the Person requesting such payment shall have paid any transfer and other taxes required by reason of such payment in a name other than that of the registered holder of the Certificate surrendered or shall have established to the satisfaction of McCaw or the Paying Agent that such tax either has been paid or is not payable. (f) After the Effective Time, there shall be no transfers on the stock transfer books of the Surviving Corporation of any LIN Common Shares which were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates formerly representing LIN Common Shares (other than Certificates representing LIN Common Shares held by McCaw, Holdings or Merger Sub, any Wholly Owned Subsidiary of McCaw, Holdings or Merger Sub, in the treasury of LIN or by any Wholly Owned Subsidiary of LIN) are presented to the Surviving Corporation or the Paying Agent, they shall be surrendered and cancelled in return for the payment of the aggregate Merger Consideration relating thereto, as provided in this Article IV, subject to applicable law and the other provisions of this Agreement in the case of Dissenting Shares. ARTICLE V REPRESENTATIONS AND WARRANTIES OF LIN LIN hereby represents and warrants to McCaw, Holdings and Merger Sub as follows: 5.1. Organization, Etc. of LIN. LIN is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to own and operate its properties, to carry on its business as now conducted and proposed by LIN to be conducted, to enter into this Agreement and (subject to the approval of the LIN stockholders) to carry out the provisions of this Agreement and consummate the transactions contemplated hereby. LIN has obtained from the appropriate Governmental Bodies (including, without limitation, the FCC) all approvals and licenses necessary for the conduct of its business and operations as currently conducted, which approvals and licenses are valid and remain in full force and effect, except where the failure to have obtained such approvals or licenses or the failure of such licenses and approvals to be valid and in full force and effect does not have and would not be reasonably expected (so far as can be foreseen at the time) to have a material adverse effect on the business, properties, operations, condition (financial or other) or prospects of LIN and its Subsidiaries taken as a whole. 5.2. Operations of Subsidiaries. Each Significant Subsidiary of LIN (a) is a corporation or other legal entity duly organized, validly existing and (if applicable) in good standing under the laws of the jurisdiction of its organization and has the full power and authority to own its properties and conduct its business and operations as currently conducted, except where the failure to be duly organized, validly existing and in good standing does not have, and would not be reasonably expected (so far as can be foreseen at the time) to have, a material adverse effect on the business, properties, operations, condition (financial or other) or prospects of LIN and its Subsidiaries taken as a whole and (b) has obtained from the appropriate Governmental Bodies (including, without limitation, the FCC) all approvals and licenses necessary for the conduct of its business and operations as currently conducted, which licenses and approvals are valid and remain in full force and effect, except where the failure to have obtained such approvals and licenses or the failure of such licenses and approvals to be valid and in full force and effect does not have and would not be reasonably expected (so far as can be foreseen at the time) to have a material adverse effect on the business, properties, operations, condition (financial or other) or prospects of LIN and its Subsidiaries taken as a whole. 5.3. Agreement. This Agreement and the consummation of the transactions contemplated hereby have been duly approved by the LIN Board and have been duly authorized by all other necessary corporate action on the part of LIN (except for the approval of LIN's stockholders contemplated by Section 8.1(a)). This Agreement has been duly executed and delivered by a duly authorized officer of LIN and constitutes a valid and binding agreement of LIN, enforceable against LIN in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors' rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. 5.4. Capital Stock. The authorized capital stock of LIN consists of (a) 150,000,000 LIN Common Shares, of which 51,714,366 shares are outstanding as of the date hereof, and (b) 2,000,000 shares of preferred stock, no par value, none of which are outstanding as of the date hereof. All outstanding LIN Common Shares are duly authorized, validly issued, fully paid and nonassessable, and no class of capital stock of LIN is entitled to preemptive rights. There are outstanding on the date hereof no options, warrants or other rights to acquire capital stock from LIN, except (i) Options representing in the aggregate the right to purchase up to 1,610,931 LIN Common Shares pursuant to the Option Plan and (ii) the Rights. Except as disclosed in LIN's public filings under the Exchange Act filed since January 1, 1995, all outstanding shares of capital stock of the Significant Subsidiaries of LIN are owned by LIN or a direct or indirect Wholly Owned Subsidiary of LIN, free and clear of all liens, charges, encumbrances, claims and options of any nature. 5.5. Brokers and Finders. Except for the fees and expenses payable to Lehman Brothers Inc. and Bear Stearns & Co., Inc., which fees and expenses are reflected in their agreements with LIN, copies of which have been furnished to McCaw, and except for Wasserstein Perella & Co., Inc., whose fees and expenses are reflected in their agreement with LIN and McCaw, neither LIN nor the LIN Independent Directors has employed any investment banker, broker, finder, consultant or intermediary in connection with the transactions contemplated by this Agreement which would be entitled to any investment banking, brokerage, finder's or similar fee or commission in connection with this Agreement or the transactions contemplated hereby. 5.6. Proxy Statement. The Proxy Statement will comply in all material respects with the requirements of the Exchange Act. The Proxy Statement will not, at the time filed with the SEC, at the date it or any amendment or supplement is mailed to stockholders and at the time of the Stockholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading; provided that the foregoing shall not apply to information supplied by McCaw, Holdings or Merger Sub with respect to any thereof or to AT&T specifically for inclusion or incorporation by reference in the Proxy Statement. If at any time prior to the Effective Time any event with respect to LIN, its officers and directors or any of its Subsidiaries should occur which is required to be described in an amendment of, or a supplement to, the Proxy Statement, LIN shall notify McCaw thereof by reference to this Section 5.6 and such event shall be so described, and such amendment or supplement shall be promptly filed with the SEC and, as required by law, disseminated to the stockholders of LIN and such amendment or supplement shall comply with all provisions of applicable law. The Proxy Statement will also form a part of the Schedule 13E-3, which Schedule 13E-3 will comply in all material respects with the requirements of the Exchange Act. Section 5.7. Delaware Section 203. The Board of Directors of LIN has taken all appropriate and necessary action such that the provisions of Section 203 of the DGCL will not apply to any of the transactions contemplated by this Agreement. Section 5.8. Rights Agreement. The Rights Agreement has been amended to provide that (i) none of AT&T, McCaw, Holdings or Merger Sub will become an "Acquiring Person," (ii) no "Triggering Event," "Share Acquisition Date" or "Distribution Date" (as such terms are defined in the Rights Agreement) will occur and (iii) Section 13 of the Rights Agreement will not be triggered, in each case as a result of the execution or delivery of this Agreement or any amendment hereto or the consummation of the transactions contemplated hereby (including, without limitation, the Merger), with the effect that (x) none of such events will trigger the exercisability of the Rights, the separation of the Rights from the stock certificates to which they are attached or any other provision of the Rights Agreement and (y) the Rights will no longer be outstanding upon the consummation of the Merger. ARTICLE VI REPRESENTATIONS AND WARRANTIES OF MCCAW, HOLDINGS AND MERGER SUB McCaw, Holdings and Merger Sub each represents and warrants to LIN as follows: 6.1. Organization, Etc. of McCaw, Holdings and Merger Sub. Each of McCaw, Holdings and Merger Sub is a corporation duly organized, validly existing and in good standing under the laws of its respective jurisdiction of incorporation, and each has all requisite corporate power and authority to own and operate its properties, to carry on its business as now conducted and proposed by it to be conducted, to enter into this Agreement and to carry out the provisions of this Agreement and consummate the transactions contemplated hereby. 6.2. Agreement. This Agreement and the consummation of the transactions contemplated hereby have been duly approved by the respective Boards of Directors of McCaw, Holdings and Merger Sub, by the unanimous vote of those directors present, and by Holdings as the sole stockholder of Merger Sub (no other corporate action on the part of McCaw, Holdings or Merger Sub being necessary). This Agreement has been duly executed and delivered by a duly authorized officer of each of McCaw, Holdings and Merger Sub and constitutes a valid and binding agreement of each of McCaw, Holdings and Merger Sub, enforceable against each in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors' rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. 6.3. Brokers and Finders. Except for the fees and expenses payable to Morgan Stanley & Co., Incorporated, which fees and expenses will be paid by AT&T and McCaw, and except for Wasserstein Perella & Co., Inc., whose fees and expenses are reflected in their agreement with LIN and McCaw, none of AT&T, McCaw, Holdings or Merger Sub has employed any investment banker, broker, finder, consultant or intermediary in connection with the transactions contemplated by this Agreement which would be entitled to any investment banking, brokerage, finder's or similar fee or commission in connection with this Agreement or the transactions contemplated hereby. 6.4. Proxy Statement. None of the information to be supplied by McCaw, Holdings or Merger Sub with respect to any thereof or to AT&T for inclusion or incorporation by reference in the Proxy Statement will, at the time of the mailing of the Proxy Statement or at the time of the Stockholder Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading. If at any time prior to the Effective Time any event with respect to McCaw, Holdings or Merger Sub, or their officers and directors or any of their Subsidiaries shall occur which is required to be described in the Proxy Statement, McCaw shall notify LIN thereof by reference to this Section 6.4 and such event shall be so described, and an amendment or supplement shall be promptly filed with the SEC and, as required by law, disseminated to the stockholders of LIN. The Proxy Statement will also form a part of the Schedule 13E-3, which Schedule 13E-3 will comply in all material respects with the requirements of the Exchange Act. 6.5. No Prior Activities. Merger Sub has not incurred, and will not incur, directly or through any Subsidiary, any liabilities or obligations for borrowed money or otherwise, except incidental liabilities or obligations not for borrowed money incurred in connection with its organization. Except as contemplated by this Agreement, Merger Sub (i) has not engaged, directly or through any Subsidiary, in any business activities of any type or kind whatsoever, (ii) has not entered into any agreements or arrangements with any person or entity and (iii) is not subject to or bound by any obligation or undertaking. 6.6. Solvency. Assuming that LIN is Solvent immediately prior to the Effective Time, the Surviving Corporation will be Solvent at and immediately after the Effective Time, after giving effect to the transactions contemplated hereby. For purposes of this Agreement, "Solvent" shall mean, with respect to LIN or the Surviving Corporation, (i) that the fair valuation of such corporation's property (on a consolidated basis) is, on the date of determination, greater than the total amount of consolidated liabilities of such corporation as of such date and (ii) that the present fair saleable value of such corporation's assets is, on the date of determination, greater than the amount that will be required to pay such corporation's probable liability on its existing debts as they become absolute and matured. ARTICLE VII ADDITIONAL COVENANTS AND AGREEMENTS 7.1. Conduct of Business of LIN. Except as contemplated by this Agreement, during the period from the date of this Agreement to the Effective Time, LIN will, and will cause each of its Subsidiaries to, conduct its operations according to, and not enter into any transaction other than in accordance with, its ordinary course of business consistent with past practice. 7.2. Reasonable Efforts. LIN, McCaw, Holdings and Merger Sub shall, and shall use all reasonable efforts to cause their respective Subsidiaries to: (i) use all reasonable efforts to promptly take, or cause to be taken, all other actions and do, or cause to be done, all things necessary, proper or appropriate to satisfy the conditions set forth in Article VIII and to consummate and make effective the transactions contemplated by this Agreement on the terms and conditions set forth herein as soon as practicable (including seeking to remove promptly any injunction or other legal barrier that may prevent such consummation); and (ii) not take any action (including, without limitation, effecting or agreeing to effect or announcing an intention or proposal to effect, any acquisition, business combination or other transaction) which might reasonably be expected to impair the ability of the parties to consummate the Merger at the earliest possible time (regardless of whether such action would otherwise be permitted or not prohibited hereunder). 7.3. Indemnification; Insurance. (a) McCaw and Holdings agree that all rights to indemnification now existing in favor of any of the present or former directors, officers or employees of LIN or any of its Subsidiaries (the "Indemnified Parties") as provided in its Certificate of Incorporation or Bylaws, or otherwise in effect on the date of this Agreement (including, without limitation, as provided in the PMVG), will survive the Merger and continue in full force and effect and McCaw and Holdings will cause the Surviving Corporation to honor all such rights to indemnification. (b) In the event of any claim, action, suit, proceeding or investigation (whether arising before or after the Effective Time) subject to the rights to indemnification provided by paragraph (a) of this Section 7.3, (i) the Surviving Corporation shall have the right, from and after the Effective Time, to assume the defense thereof and McCaw and Holdings shall not be liable to such Indemnified Parties for any legal expenses of other counsel or any other expenses subsequently incurred by such Indemnified Parties in connection with the defense thereof, (ii) the Indemnified Parties will cooperate in the defense of any such matter and (iii) McCaw and Holdings will not be liable for any settlement effected without their prior written consent; provided that McCaw and Holdings will not have any obligation hereunder to any Indemnified Party when and if a court of competent jurisdiction shall ultimately determine, and such determination shall have become final, that the indemnification of such Indemnified Party in the manner contemplated hereby is prohibited by applicable law. (c) McCaw and Holdings shall cause to be maintained in effect for not less than six years after the Effective Time the current policies of directors' and officers' liability insurance maintained by LIN with respect to matters occurring prior to and including the Effective Time for all present and past directors and officers of LIN or any of its Subsidiaries; provided, however, that (i) McCaw and Holdings may substitute therefor policies of at least the same coverage containing terms and conditions which are no less advantageous to the directors and officers covered thereby and (ii) McCaw and Holdings shall not be required to pay in the aggregate an annual premium for such insurance in excess of two times the last annual premium paid prior to the date hereof, but in such case shall purchase as much coverage as possible for such amount. (d) In the event that any action, suit, proceeding or investigation relating hereto or to the transactions contemplated by this Agreement is commenced, whether before or after the Closing, the parties hereto agree to cooperate and use their respective reasonable efforts to vigorously defend against and respond thereto. (e) This Section 7.3 is intended to benefit the persons covered by the indemnification rights and/or insurance policies referred to in this Section 7.3 and shall be binding on all successors and assigns of McCaw, Holdings, Merger Sub, LIN and the Surviving Corporation. 7.4. New York Real Property Gains and Transfer Tax. Any liability arising out of New York State and/or New York City Real Property Gains and Transfer Taxes, with respect to interests in real property owned directly or indirectly by LIN immediately prior to the Merger, if applicable and due with respect to the Merger, shall be borne by LIN and expressly shall not be a liability of the stockholders of LIN. ARTICLE VIII CONDITIONS 8.1. Conditions to Each Party's Obligations. The respective obligations of each party to consummate the transactions contemplated by this Agreement are subject to the fulfillment at or prior to the Effective Time of each of the following conditions, any or all of which may be waived (other than the condition set forth in clause (ii) of Section 8.1(a)) in whole or in part by the party being benefitted thereby, to the extent permitted by applicable law and the PMVG: (a) Stockholder Approval. This Agreement and the transactions contemplated hereby shall have been duly approved at the Stockholders Meeting by (i) the requisite holders of LIN Common Shares in accordance with applicable law and the Certificate of Incorporation and By-Laws of LIN and (ii) the affirmative vote of the holders of at least a majority of the LIN Public Shares present and entitled to vote at the Stockholders Meeting at which a majority of the LIN Public Shares shall have been present. (b) No Injunction. There shall not be in effect any judgment, writ, order, injunction or decree of any court or Governmental Body of competent jurisdiction, restraining, enjoining or otherwise preventing consummation of the transactions contemplated by this Agreement or permitting such consummation only subject to any condition or restriction unacceptable to McCaw in its reasonable judgment; provided, however, that any party invoking this condition shall use reasonable efforts to have any such order or injunction vacated or any such other restriction eliminated. 8.2. Conditions to Obligations of McCaw, Holdings and Merger Sub. The respective obligations of McCaw, Holdings and Merger Sub to consummate the transactions contemplated by this Agreement are subject to the fulfillment at or prior to the Effective Time of each of the following conditions, any or all of which may be waived in whole or part by McCaw, Holdings and Merger Sub, as the case may be, to the extent permitted by applicable law: (a) Representations and Warranties True. The representations and warranties of LIN contained in Section Article V shall have been true in all material respects when made and at the time of the Closing with the same effect as though such representations and warranties had been made at such time, except for changes resulting from the consummation of the transactions contemplated by this Agreement. (b) Performance. LIN shall have performed or complied in all material respects with all agreements and conditions contained herein required to be performed or complied with by it prior to or at the time of the Closing. (c) Government Consents, Etc. All Authorizations, if any, required in connection with the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby shall have been made or obtained, in each case without limitation or restriction unacceptable to McCaw in its reasonable judgment, except where the failure to have obtained such Authorizations would not be reasonably expected (so far as can be foreseen at the time) to have a material adverse effect on the business, properties, operations, condition (financial or other) or prospects of (i) LIN and its Subsidiaries taken as a whole or (ii) McCaw and its Subsidiaries taken as a whole. (d) No Proceeding or Litigation. No suit, action, investigation, inquiry or other proceeding by or before any Governmental Body shall have been instituted and be pending which questions the validity or legality of the PMVG or the proceedings thereunder or of this Agreement or the transactions contemplated hereby, or which imposes or could impose any remedy, condition or restriction in connection therewith unacceptable to McCaw. (e) Third Party Consents. All required authorizations, consents or approvals in connection with the Merger of any third party (other than a Governmental Body), if any, the failure to obtain which would have a material adverse effect on (i) LIN and its Subsidiaries taken as a whole or (ii) McCaw and its Subsidiaries taken as a whole, shall have been obtained. 8.3. Conditions to Obligations of LIN. The obligations of LIN to consummate the transactions contemplated by this Agreement are subject to the fulfillment at or prior to the Effective Time of each of the following conditions, any or all of which may be waived in whole or in part by LIN to the extent permitted by applicable law: (a) Representations and Warranties True. The representations and warranties of McCaw, Holdings and Merger Sub contained in Article VI shall have been true in all material respects when made and at the time of the Closing with the same effect as though such representations and warranties had been made at such time, except for changes resulting from the consummation of the transactions contemplated by this Agreement. (b) Performance. Each of McCaw, Holdings and Merger Sub shall have performed or complied in all material respects with all agreements and conditions contained herein required to be performed or complied with by it prior to or at the time of the Closing. ARTICLE IX TERMINATION, AMENDMENT AND WAIVER 9.1. Termination by Mutual Consent. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time, before or after the approval by holders of LIN Common Shares, either by the mutual written consent of McCaw and LIN, or by mutual action of their respective Boards of Directors. 9.2. Termination by Either McCaw or LIN. This Agreement may be terminated (upon notice from the terminating party to the other parties) and the Merger may be abandoned by action of the Board of Directors of either McCaw or LIN if (a) the Merger shall not have been consummated by December 31, 1995 or, if the condition set forth in Section 8.1(a) shall have been satisfied and the Merger is being pursued in good faith by McCaw but has not been completed due to regulatory delays or litigation, August 31, 1996, (b) any court of competent jurisdiction in the United States or Governmental Body in the United States shall have issued an order, decree or ruling or taken any other action permanently restraining, enjoining or otherwise prohibiting the Merger and such order, decree, ruling or other action shall have become final and nonappealable, or (c) at the Stockholders Meeting, this Agreement and the Merger shall not receive the affirmative vote of the holders of at least a majority of the LIN Public Shares present and entitled to vote at the Stockholders Meeting). 9.3. Amendment. Subject to the applicable provisions of the DGCL, at any time prior to the Effective Time, the parties hereto may modify, amend or supplement this Agreement, by written agreement executed and delivered by duly authorized officers of the respective parties with respect to any of the terms contained herein; provided, however, that after approval of the Merger by the stockholders of LIN, no such amendment or modification shall be made which reduces the form or amount of consideration payable in the Merger or adversely affects the rights of LIN's stockholders hereunder without the approval of such stockholders. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties. 9.4. Extension; Waiver. At any time prior to the Effective Time, the parties may (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (c) subject to Section 9.3, waive compliance with any of the agreements or conditions (other than the condition set forth in clause (ii) of Section 8.1(a)) contained in this Agreement. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights. 9.5. Effect of Termination and Abandonment. In the event of termination of this Agreement and abandonment of the Merger pursuant to this Article IX, no party hereto (or any of its directors or officers) shall have any liability or further obligation to any other party under this Agreement, except that nothing herein will relieve any party from liability for any breach of this Agreement. Except as and to the extent provided in the PMVG, the termination of this Agreement and abandonment of the Merger pursuant to this Article IX shall not affect in any way the PMVG, which shall continue to be in full force and effect to the extent of and in accordance with its terms. ARTICLE X MISCELLANEOUS AND GENERAL 10.1. Expenses. Each party shall bear its own expenses, including the fees and expenses of any attorneys, accountants, investment bankers, brokers, finders or other intermediaries or other Persons engaged by it, incurred in connection with this Agreement and the transactions contemplated hereby, except as set forth in Section 7.4 and except that expenses incurred in connection with printing and mailing the Proxy Statement will be shared equally by McCaw, Holdings and Merger Sub, on the one hand, and LIN, on the other. 10.2. Notices, Etc. All notices, requests, demands or other communications required by or otherwise with respect to this Agreement shall be in writing and shall be deemed to have been duly given to any party when delivered personally (by courier service or otherwise), when delivered by telecopy and confirmed by return telecopy, or seven days after being mailed by first-class mail, postage prepaid and return receipt requested in each case to the applicable addresses set forth below: If to LIN: LIN Broadcasting Corporation 5400 Carillon Point Kirkland, Washington 98033 Attn: Mr. Tom A. Alberg Telecopy: (206) 828-1835 with copies to: David B. Chapnick, Esq. Simpson Thacher & Bartlett 425 Lexington Avenue New York, NY 10017 Telecopy: (212) 455-2502 and Jeffrey Weinberg, Esq. Weil, Gotshal & Manges 767 Fifth Avenue New York, NY 10153 Telecopy: (212) 310-8007 If to McCaw, Holdings or Merger Sub: McCaw Cellular Communications, Inc. 1150 Connecticut Avenue, N.W. Suite 400 Washington, DC 20036 Attn: Andrew A. Quartner, Esq. Telecopy: (202) 223-9095 with copies to: AT&T Corp. 131 Morristown Rd., C64-A2029 Basking Ridge, New Jersey 07920 Attn: Marilyn J. Wasser, Esq. Telecopy: (908) 953-4657 and Steven A. Rosenblum, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Telecopy: (212) 403-2000 or to such other address as such party shall have designated by notice so given to each other party. 10.3. Nonsurvival of Representations and Warranties. None of the representations and warranties in this Agreement (other than the representations and warranties set forth in Sections 6.5 and 6.6) or in any instrument delivered pursuant to this Agreement shall survive the Effective Time. This Section 10.3 shall not limit any covenant or agreement of the parties which by its terms contemplates performance after the Effective Time. 10.4. No Assignment. This Agreement shall be binding upon and shall inure to the benefit of and be enforceable by the parties and their respective successors and assigns; provided that, except as otherwise expressly set forth in this Agreement, neither the rights nor the obligations of any party may be assigned or delegated without the prior written consent of the other party. 10.5. Entire Agreement. This Agreement embodies the entire agreement and understanding between the parties relating to the subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter; provided, however, that the parties hereto acknowledge and agree that this Agreement shall not supersede or in any way modify the PMVG which shall continue to be in full force and effect in accordance with its terms. 10.6. Specific Performance. The parties acknowledge that money damages are not an adequate remedy for violations of this Agreement and that any party may, in its sole discretion, apply to a court of competent jurisdiction for specific performance or injunctive or such other relief as such court may deem just and proper in order to enforce this Agreement or prevent any violation hereof and, to the extent permitted by applicable law, each party waives any objection to the imposition of such relief. 10.7. Remedies Cumulative. All rights, powers and remedies provided under this Agreement or otherwise available in respect hereof at law or in equity shall be cumulative and not alternative, and the exercise or beginning of the exercise of any thereof by any party shall not preclude the simultaneous or later exercise of any other such right, power or remedy by such party. 10.8. No Waiver. The failure of any party hereto to exercise any right, power or remedy provided under this Agreement or otherwise available in respect hereof at law or in equity, or to insist upon compliance by any other party hereto with its obligations hereunder, and any custom or practice of the parties at variance with the terms hereof, shall not constitute a waiver by such party of its right to exercise any such or other right, power or remedy or to demand such compliance. 10.9. No Third Party Beneficiaries. This Agreement is not intended to be for the benefit of and shall not be enforceable by any Person or entity who or which is not a party hereto, except for the indemnification provisions contained in Section 7.3, which provisions may be enforced by the parties referred to therein. 10.10. Public Announcements. McCaw and LIN will agree upon the timing and content of the initial press release to be issued describing the transactions contemplated by this Agreement, and will not make any public announcement thereof prior to reaching such agreement unless required to do so by applicable law or regulation. To the extent reasonably requested by either party, each party will thereafter consult with and provide reasonable cooperation to the other in connection with the issuance of further press releases or other public documents describing the transactions contemplated by this Agreement. 10.11. Certain Actions by LIN. Notwithstanding anything contained herein to the contrary, LIN shall not be deemed to have breached this Agreement by virtue of any action taken by LIN that is expressly approved by a majority of the members of the LIN Board who are employees of McCaw or its affiliates other than LIN and its Subsidiaries. 10.12. Governing Law. This Agreement and all disputes hereunder shall be governed by and construed and enforced in accordance with the internal laws of the State of Delaware, without regard to principles of conflict of laws. 10.13. Name, Captions, Etc. The name assigned this Agreement and the section captions used herein are for convenience of reference only and shall not affect the interpretation or construction hereof. Unless otherwise specified, (a) the terms "hereof", "herein" and similar terms refer to this Agreement as a whole and (b) references herein to Articles or Sections refer to articles or sections of this Agreement. 10.14. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies each signed by less than all, but together signed by all, the parties hereto. 10.15. McCaw Guarantee. McCaw absolutely, irrevocably and unconditionally guarantees the performance and satisfaction of the obligations of each of Holdings, Merger Sub and the Surviving Corporation under this Agreement. IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties set forth below. MCCAW CELLULAR COMMUNICATIONS, INC. By: /s/ Wayne Perry MMM HOLDINGS, INC. By: /s/ Wayne Perry MMM ACQUISITION CORP. By: /s/ Marilyn Wasser LIN BROADCASTING CORPORATION By: /s/ Lewis Chakrin -----END PRIVACY-ENHANCED MESSAGE-----