CONDENSED CONSOLIDATING FINANCIAL STATEMENTS:

STG, a wholly-owned subsidiary and the television operating subsidiary of Sinclair Broadcast Group, Inc. (SBG), is the primary obligor under the Bank Credit Agreement, the 5.375% Notes, 5.625% Notes, 6.125% Notes, 5.875% Notes, 5.125% Notes, and until they were redeemed, the 6.375% Notes. Our Class A Common Stock and Class B Common Stock as of September 30, 2017, were obligations or securities of SBG and not obligations or securities of STG. SBG is a guarantor under the Bank Credit Agreement, the 5.375% Notes, 5.625% Notes, 6.125% Notes, 5.875% Notes, 6.125% Notes, and 5.125% Notes, and until they were redeemed, the 6.375% Notes. As of September 30, 2017, our consolidated total debt, net of deferred financing costs and debt discounts, of $4,055.6 million included $4,027.1 million related to STG and its subsidiaries of which SBG guaranteed $3,980.9 million.

SBG, KDSM, LLC, a wholly-owned subsidiary of SBG, and STG’s wholly-owned subsidiaries (guarantor subsidiaries), have fully and unconditionally guaranteed, subject to certain customary automatic release provisions, all of STG’s obligations. Those guarantees are joint and several. There are certain contractual restrictions on the ability of SBG, STG or KDSM, LLC to obtain funds from their subsidiaries in the form of dividends or loans.

The following condensed consolidating financial statements present the consolidated balance sheets, consolidated statements of operations and consolidated statements of cash flows of SBG, STG, KDSM, LLC and the guarantor subsidiaries, the direct and indirect non-guarantor subsidiaries of SBG and the eliminations necessary to arrive at our information on a consolidated basis. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

These statements are presented in accordance with the disclosure requirements under SEC Regulation S-X, Rule 3-10.

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF SEPTEMBER 30, 2017

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Cash	$	—	$	551,349	$	22,161	$	28,683		$	—		$	602,193
Restricted cash	—		—		187,854		124,948			—			312,802
Accounts receivable	—		—		488,553		34,558			—			523,111
Other current assets	4,063		4,843		139,838		25,511			(22,930		)	151,325
Total current assets	4,063		556,192		838,406		213,700			(22,930		)	1,589,431

Property and equipment, net	1,075		17,814		584,699		133,155			(12,618		)	724,125

Investment in consolidated subsidiaries	1,109,617		3,759,217		4,179		—			(4,873,013		)	—
Goodwill	—		—		2,109,784		3,867			—			2,113,651
Indefinite-lived intangible assets	—		—		153,011		15,709			—			168,720
Definite-lived intangible assets	—		—		1,820,369		80,168			(58,599		)	1,841,938
Other long-term assets	36,255		836,081		102,107		157,903			(883,142		)	249,204
Total assets	$	1,151,010	$	5,169,304	$	5,612,555	$	604,502		$	(5,850,302	)	$	6,687,069

Accounts payable and accrued liabilities	$	207	$	68,816	$	204,821	$	42,129		$	(25,125	)	$	290,848
Deferred spectrum auction proceeds	—		—		187,854		122,948			—			310,802
Current portion of long-term debt	—		154,521		2,357		7,607			—			164,485
Current portion of affiliate long-term debt	479		—		1,388		765			(449		)	2,183
Other current liabilities	—		—		127,097		15,808						142,905
Total current liabilities	686		223,337		523,517		189,257			(25,574		)	911,223

Long-term debt	—		3,806,135		28,954		41,045			—			3,876,134
Affiliate long-term debt	—		—		11,505		343,517			(342,198		)	12,824
Other liabilities	8,329		36,524		1,289,220		181,505			(736,989		)	778,589
Total liabilities	9,015		4,065,996		1,853,196		755,324			(1,104,761		)	5,578,770

Total Sinclair Broadcast Group equity (deficit)	1,141,995		1,103,308		3,759,359		(112,439		)	(4,750,228		)	1,141,995
Noncontrolling interests in consolidated subsidiaries	—		—		—		(38,383		)	4,687			(33,696		)
Total liabilities and equity (deficit)	$	1,151,010	$	5,169,304	$	5,612,555	$	604,502		$	(5,850,302	)	$	6,687,069

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2016

(in thousands)



	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Cash	$	—	$	232,297	$	10,675	$	17,012		$	—		$	259,984
Restricted Cash	—		—		200		—			—			200
Accounts receivable	—		—		478,190		37,024			(1,260		)	513,954
Other current assets	5,561		3,143		124,113		25,406			(27,273		)	130,950
Total current assets	5,561		235,440		613,178		79,442			(28,533		)	905,088

Property and equipment, net	1,820		17,925		570,289		131,326			(3,784		)	717,576

Investment in consolidated subsidiaries	551,250		3,614,605		4,179		—			(4,170,034		)	—
Goodwill	—		—		1,986,467		4,279			—			1,990,746
Indefinite-lived intangible assets	—		—		140,597		15,709			—			156,306
Definite-lived intangible assets	—		—		1,770,512		233,368			(59,477		)	1,944,403
Other long-term assets	$	46,586	$	819,506	$	103,808	$	169,817		$	(890,668	)	$	249,049
Total assets	$	605,217	$	4,687,476	$	5,189,030	$	633,941		$	(5,152,496	)	$	5,963,168

Accounts payable and accrued liabilities	$	100	$	69,118	$	225,645	$	48,815		$	(21,173	)	$	322,505
Current portion of long-term debt	—		55,501		1,851		113,779			—			171,131
Current portion of affiliate long-term debt	1,857		—		1,514		2,336			(2,103		)	3,604
Other current liabilities	—		—		127,967		13,590			(2,324		)	139,233
Total current liabilities	1,957		124,619		356,977		178,520			(25,600		)	636,473

Long-term debt	—		3,939,463		31,014		44,455			—			4,014,932
Affiliate long-term debt	—		—		12,663		396,957			(395,439		)	14,181
Other liabilities	15,277		31,817		1,190,717		183,418			(681,583		)	739,646
Total liabilities	17,234		4,095,899		1,591,371		803,350			(1,102,622		)	5,405,232

Total Sinclair Broadcast Group equity (deficit)	587,983		591,577		3,597,659		(134,991		)	(4,054,245		)	587,983
Noncontrolling interests in consolidated subsidiaries	—		—		—		(34,418		)	4,371			(30,047		)
Total liabilities and equity (deficit)	$	605,217	$	4,687,476	$	5,189,030	$	633,941		$	(5,152,496	)	$	5,963,168

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2017

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	638,100		$	50,816		$	(18,025	)	$	670,891

Media program and production expenses	—			—			254,956			29,376			(16,339		)	267,993
Selling, general and administrative	2,027			23,534			130,289			3,582			4			159,436
Depreciation, amortization and other operating expenses	247			1,591			111,849			27,158			(830		)	140,015
Total operating expenses	2,274			25,125			497,094			60,116			(17,165		)	567,444

Operating (loss) income	(2,274		)	(25,125		)	141,006			(9,300		)	(860		)	103,447

Equity in earnings of consolidated subsidiaries	32,196			90,445			114			—			(122,755		)	—
Interest expense	(10		)	(50,247		)	(1,013		)	(4,968		)	4,495			(51,743		)
Other income (expense)	(92		)	1,869			(2,673		)	(1,124		)	—			(2,020		)
Total other income (expense)	32,094			42,067			(3,572		)	(6,092		)	(118,260		)	(53,763		)

Income tax benefit (provision)	817			25,364			(46,987		)	3,688			—			(17,118		)
Net income (loss)	30,637			42,306			90,447			(11,704		)	(119,120		)	32,566
Net income attributable to the noncontrolling interests	—			—			—			(1,730		)	(199		)	(1,929		)
Net income (loss) attributable to Sinclair Broadcast Group	$	30,637		$	42,306		$	90,447		$	(13,434	)	$	(119,319	)	$	30,637
Comprehensive income (loss)	$	30,637		$	42,306		$	90,447		$	(11,704	)	$	(119,120	)	$	32,566

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2016

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	655,778		$	63,877		$	(25,820	)	$	693,835

Media program and production expenses	—			—			234,474			33,556			(25,150		)	242,880
Selling, general and administrative	1,275			16,969			124,352			3,153			(25		)	145,724
Depreciation, amortization and other operating expenses	266			3,257			115,527			32,571			(384		)	151,237
Total operating expenses	1,541			20,226			474,353			69,280			(25,559		)	539,841

Operating (loss) income	(1,541		)	(20,226		)	181,425			(5,403		)	(261		)	153,994

Equity in earnings of consolidated subsidiaries	51,113			114,060			51			—			(165,224		)	—
Interest expense	(56		)	(50,364		)	(1,117		)	(8,256		)	6,305			(53,488		)
Loss from extinguishment of debt	—			(23,699		)	—			—			—			(23,699		)
Other income (expense)	1,157			469			(27		)	613			—			2,212
Total other income (expense)	52,214			40,466			(1,093		)	(7,643		)	(158,919		)	(74,975		)

Income tax benefit (provision)	172			34,334			(64,535		)	3,043			—			(26,986		)
Net income (loss)	50,845			54,574			115,797			(10,003		)	(159,180		)	52,033
Net income attributable to the noncontrolling interests	—			—			—			(1,180		)	(8		)	(1,188		)
Net income (loss) attributable to Sinclair Broadcast Group	$	50,845		$	54,574		$	115,797		$	(11,183	)	$	(159,188	)	$	50,845
Comprehensive income (loss)	$	50,845		$	54,574		$	115,797		$	(10,003	)	$	(159,180	)	$	52,033

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	1,901,075		$	157,236		$	(58,196	)	$	2,000,115

Media program and production expenses	—			—			760,642			88,296			(53,798		)	795,140
Selling, general and administrative	5,615			64,903			377,177			9,135			—			456,830
Depreciation, amortization and other operating expenses	738			4,967			335,316			29,248			(2,048		)	368,221
Total operating expenses	6,353			69,870			1,473,135			126,679			(55,846		)	1,620,191

Operating (loss) income	(6,353		)	(69,870		)	427,940			30,557			(2,350		)	379,924

Equity in earnings of consolidated subsidiaries	136,311			274,850			257			—			(411,418		)	—
Interest expense	(81		)	(154,330		)	(3,557		)	(16,740		)	14,688			(160,020		)
Loss from the extinguishment of debt	—			(1,404		)	—			—			—			(1,404		)
Other income	731			3,796			(4,071		)	924			—			1,380
Total other income (expense)	136,961			122,912			(7,371		)	(15,816		)	(396,730		)	(160,044		)

Income tax benefit (provision)	1,875			75,105			(143,059		)	(4,498		)	—			(70,577		)
Net income (loss)	132,483			128,147			277,510			10,243			(399,080		)	149,303
Net income attributable to the noncontrolling interests	—			—			—			(16,608		)	(212		)	(16,820		)
Net income (loss) attributable to Sinclair Broadcast Group	$	132,483		$	128,147		$	277,510		$	(6,365	)	$	(399,292	)	$	132,483
Comprehensive income (loss)	$	132,483		$	128,147		$	277,510		$	10,243		$	(399,080	)	$	149,303

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	1,828,407		$	178,164		$	(67,313	)	$	1,939,258

Media program and production expenses	—			—			679,337			88,378			(65,338		)	702,377
Selling, general and administrative	3,277			53,189			360,793			7,641			(59		)	424,841
Depreciation, amortization and other operating expenses	798			5,666			340,974			96,560			(1,365		)	442,633
Total operating expenses	4,075			58,855			1,381,104			192,579			(66,762		)	1,569,851

Operating (loss) income	(4,075		)	(58,855		)	447,303			(14,415		)	(551		)	369,407

Equity in earnings of consolidated subsidiaries	124,536			289,593			170			—			(414,299		)	—
Interest expense	(192		)	(147,635		)	(3,417		)	(24,258		)	18,683			(156,819		)
Loss from extinguishment of debt	—			(23,699		)	—			—			—			(23,699		)
Other income (expense)	3,386			736			583			439			—			5,144
Total other income (expense)	127,730			118,995			(2,664		)	(23,819		)	(395,616		)	(175,374		)

Income tax benefit (provision)	749			75,470			(150,436		)	8,446			—			(65,771		)
Net income (loss)	124,404			135,610			294,203			(29,788		)	(396,167		)	128,262
Net income attributable to the noncontrolling interests	—			—			—			(3,341		)	(517		)	(3,858		)
Net income (loss) attributable to Sinclair Broadcast Group	$	124,404		$	135,610		$	294,203		$	(33,129	)	$	(396,684	)	$	124,404
Comprehensive income (loss)	$	124,404		$	135,610		$	294,203		$	(29,788	)	$	(396,167	)	$	128,262

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES	$	(5,605	)	$	(141,239	)	$	433,435		$	(12,959	)	$	4,779		$	278,411
CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:
Acquisition of property and equipment	(131		)	(6,088		)	(47,564		)	(2,677		)	997			(55,463		)
Acquisition of businesses, net of cash acquired	—			(8,308		)	(261,491		)	—			—			(269,799		)
Purchase of alarm monitoring contracts	—			—			—			(5,682		)	—			(5,682		)
Proceeds from sale of non-media business	—			—			—			192,634			—			192,634
Investments in equity and cost method investees	(945		)	(1,101		)	(15,469		)	(4,787		)	—			(22,302		)
Other, net	3,903			(7,733		)	541			2,739			—			(550		)
Net cash flows from (used in) investing activities	2,827			(23,230		)	(323,983		)	182,227			997			(161,162		)

CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES:
Proceeds from notes payable, commercial bank financing and capital leases	—			159,669			—			6,372			—			166,041
Repayments of notes payable, commercial bank financing and capital leases	—			(200,119		)	(1,367		)	(116,823		)	—			(318,309		)
Proceeds from the issuance of Class A Common Stock	487,883			—			—			—			—			487,883
Dividends paid on Class A and Class B Common Stock	(53,049		)	—			—			—			—			(53,049		)
Repurchase of outstanding Class A Common Stock	(30,287		)	—			—			—			—			(30,287		)
Distributions to noncontrolling interests	—			—			—			(20,469		)	—			(20,469		)
Increase (decrease) in intercompany payables	(400,451		)	524,016			(92,993		)	(24,750		)	(5,822		)	—
Other, net	(1,318		)	(45		)	(3,606		)	(1,927		)	46			(6,850		)
Net cash flows (used in) from financing activities	2,778			483,521			(97,966		)	(157,597		)	(5,776		)	224,960

NET INCREASE IN CASH AND CASH EQUIVALENTS	—			319,052			11,486			11,671			—			342,209
CASH AND CASH EQUIVALENTS, beginning of period	—			232,297			10,675			17,012			—			259,984
CASH AND CASH EQUIVALENTS, end of period	$	—		$	551,349		$	22,161		$	28,683		$	—		$	602,193

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016

(in thousands) (unaudited)



	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES	$	(4,060	)	$	(152,724	)	$	451,804		$	17,138		$	18,102		$	330,260
CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:
Acquisition of property and equipment	(7		)	(3,626		)	(61,758		)	(3,842		)	632			(68,601		)
Acquisition of businesses, net of cash acquired	—			—			(415,481		)	(10,375		)	—			(425,856		)
Purchase of alarm monitoring contracts	—			—			—			(29,143		)	—			(29,143		)
Investments in equity and cost method investees	(2,945		)	(10,840		)	(34		)	(20,405		)	—			(34,224		)
Proceeds from sale of non-media business	—			—			7,263			9,133			—			16,396
Loans to affiliates	—			(19,500		)	—			—			—			(19,500		)
Other, net	1,714			(1,828		)	(86		)	3,601			—			3,401
Net cash flows from (used in) investing activities	(1,238		)	(35,794		)	(470,096		)	(51,031		)	632			(557,527		)

CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES:
Proceeds from notes payable, commercial bank financing and capital leases	—			995,000			—			16,312			—			1,011,312
Repayments of notes payable, commercial bank financing and capital leases	—			(636,547		)	(1,171		)	(16,269		)	—			(653,987		)
Dividends paid on Class A and Class B Common Stock	(49,667		)	—			—			—			—			(49,667		)
Distributions to noncontrolling interests	—			—			—			(8,363		)	—			(8,363		)
Repurchase of outstanding Class A Common Stock	(101,164		)	—			—			—			—			(101,164		)
Increase (decrease) in intercompany payables	158,574			(189,022		)	22,603			26,764			(18,919		)	—
Other, net	(2,445		)	(15,013		)	1,175			(193		)	185			(16,291		)
Net cash flows (used in) from financing activities	5,298			154,418			22,607			18,251			(18,734		)	181,840

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	—			(34,100		)	4,315			(15,642		)	—			(45,427		)
CASH AND CASH EQUIVALENTS, beginning of period	—			115,771			235			33,966			—			149,972
CASH AND CASH EQUIVALENTS, end of period	$	—		$	81,671		$	4,550		$	18,324		$	—		$	104,545