BENEDEK COMMUNICATIONS CORP, 10-K405, 1997-03-31

BENEDEK COMMUNICATIONS CORP
10-K405, 1997-03-31
TELEVISION BROADCASTING STATIONS

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

---------------------------

FORM 10-K

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

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996 COMMISSION FILE NUMBER 333-09529
---------------------------
BENEDEK COMMUNICATIONS CORPORATION

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
---------------------------

DELAWARE 36-4076007
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
---------------------------

100 PARK AVENUE 61101
ROCKFORD, ILLINOIS (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 815-987-5350

---------------------------

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED:
------------------- ---------------------
NONE NONE

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
NONE

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, 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. [X]

100% of the voting common stock of the registrant is owned by Mr. A.
Richard Benedek and none of the voting common stock of the registrant is held by
non-affiliates.

Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date: At March 21, 1997,
there were outstanding 7,030,000 shares of common stock, $0.01 par value.

DOCUMENTS INCORPORATED BY REFERENCE: None.
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BENEDEK COMMUNICATIONS CORPORATION

INDEX TO FORM 10-K
<TABLE>
<CAPTION>

ITEM
NUMBER PAGE
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PART I
<S> <C> <C>
Item 1. Business............................................................................... 1
Item 2. Properties............................................................................. 25
Item 3. Legal Proceedings...................................................................... 28
Item 4. Submission of Matters to a Vote of Security Holders.................................... 28

PART II

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters.................. 29
Item 6. Selected Consolidated Financial Data................................................... 29
Item 7. Management's Discussion and Analysis of Financial Condition and Results of
Operations............................................................................. 31
Item 8. Financial Statements and Supplementary Data............................................ 40
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure............................................................................. 40

PART III

Item 10. Directors and Executive Officers of the Registrant..................................... 41
Item 11. Executive Compensation................................................................. 43
Item 12. Security Ownership of Certain Beneficial Owners and Management......................... 44
Item 13. Certain Relationships and Related Transactions......................................... 45

PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K........................ 46
Signatures................................................................................................ 50

</TABLE>

PART I

ITEM 1. BUSINESS.

This Annual Report on Form 10-K contains forward-looking statements that
involve risks and uncertainties. Actual results could differ materially from
those anticipated in these forward-looking statements as a result of certain
factors, including changes in national and regional economies, competition in
the television business, successful integration of acquired television stations,
pricing fluctuations in local and national advertising, program ratings and
changes in programming costs, among other factors.

Except as otherwise provided, the financial data set forth below is derived
from the historical financial statements of Benedek Communications Corporation
(the "Company") prepared in accordance with generally accepted accounting
principles. Such historical financial data includes the results of operations of
five television stations acquired from Stauffer Communications, Inc. (the
"Stauffer Stations") and eight television stations acquired from Brissette
Broadcasting Corporation (the "Brissette Stations," and together with the
Stauffer Stations, the "Acquired Stations") from the date of the acquisition
thereof on June 6, 1996. As used herein, "Same Station" data refers to the
historical results of operations of all 22 television stations currently owned
by the Company as if such stations were owned by the Company throughout the
periods with pro forma adjustments only for corporate expenses, depreciation and
amortization. The "Benedek Stations" refers to the existing nine stations owned
by the Company before the June 6, 1996 acquisitions.

As used herein, "Adjusted EBITDA" is defined as operating income before
financial income as derived from the consolidated statements of operations plus
depreciation and amortization, amortization of program broadcast rights and
noncash compensation less payments for program broadcast rights. "Adjusted
EBITDA" as defined in the Company's Credit Agreement excludes from the foregoing
definition certain noncash revenues used in determining operating income. As
used herein, "broadcast cash flow" is defined as Adjusted EBITDA plus corporate
expenses. Adjusted EBITDA and broadcast cash flow are measures used by certain
investors to measure a company's ability to service debt. Adjusted EBITDA and
broadcast cash flow should not be considered as a substitute for measures of
performance prepared in accordance with generally accepted accounting
principles.

GENERAL

The Company owns 22 network-affiliated television stations (the "Stations")
in the United States. The Stations are diverse in geographic and network
affiliation, serve small to medium-sized markets and, in the aggregate, reach
communities in 24 states. Twelve of the Stations are affiliated with CBS, six
are affiliated with ABC and four are affiliated with NBC.

On June 6, 1996, the Company acquired substantially all of the broadcast
television assets (including working capital of approximately $1.6 million) of
Stauffer Communications, Inc. ("Stauffer") consisting of five principal
broadcast television stations and four satellite broadcast television stations
for a purchase price of $54.5 million. The principal stations acquired by the
Company were KCOY-TV, Santa Maria, California; WIBW-TV, Topeka, Kansas; KMIZ-TV,
Columbia, Missouri; KGWC-TV, Casper, Wyoming; and KGWN- TV, Cheyenne, Wyoming.
KGWC-TV operates two satellite stations, KGWL-TV, Lander, Wyoming, and KGWR-TV,
Rock Springs, Wyoming, both of which rebroadcast the programming of KGWC-TV.
KGWN- TV operates two satellite stations, KSTF-TV, Scottsbluff, Nebraska, and
KTVS-TV, Sterling, Colorado, both

-1-

of which rebroadcast the programming of KGWN-TV. All of the Stauffer Stations
are affiliated with CBS, except for KMIZ-TV, Columbia, Missouri, which is
affiliated with ABC.

On June 6, 1996, the Company acquired all of the capital stock of Brissette
Broadcasting Corporation ("Brissette") for $270.0 million in cash and preferred
stock. By acquiring all of the capital stock of Brissette, the Company acquired
eight network-affiliated television stations including WMTV-TV, the NBC
affiliate serving Madison, Wisconsin; WWLP-TV, the NBC affiliate serving
Springfield, Massachusetts; WILX-TV, the NBC affiliate serving Lansing,
Michigan; WHOI-TV, the ABC affiliate serving Peoria, Illinois; WSAW- TV, the CBS
affiliate serving Wausau, Wisconsin; WTRF-TV, the CBS affiliate serving
Wheeling, West Virginia and Steubenville, Ohio; KAUZ-TV, the CBS affiliate
serving Wichita Falls, Texas; and KOSA-TV, the CBS affiliate serving Odessa,
Texas.

The Company believes that the television industry is in a period of
consolidation as a result of which a relatively small number of station
operators will emerge as the leading television station group owners in the
United States. Recent telecommunications legislation that eliminates
restrictions on the number of television stations that any individual or entity
may own so long as the aggregate audience reach does not exceed 35% of all U.S.
households is likely to accelerate this trend. The Company's growth strategy, of
which the acquisition of the Stauffer Stations and Brissette Stations was a
part, is to become one of the leading group owners of small to medium-sized
market television stations in the United States. The Company believes that this
expansion will create economics of scale which will (i) improve its ability to
negotiate more favorable arrangements with program suppliers, national sales
representation firms, equipment vendors and television networks, (ii) enable
it to develop program consortiums for regional news and sports programming and
(iii) enhance its ability to attract and retain strong management and on-air
talent.

The Stations are located in markets ranked in size from 84 to 197 out of
the 211 markets surveyed by A. C. Nielsen Company ("Nielsen"). The Company
believes that broadcast television stations in small to medium-sized markets
offer an opportunity to generate attractive and stable Adjusted EBITDA due to
limited competition for viewers from other over-the-air broadcasters, from other
media soliciting advertising expenditures and from other broadcasters purchasing
syndicated programming. The Company targets small and medium-sized markets that
have stable employment and population and a diverse base of employers. The
markets targeted by the Company generally have population centers that share
common community interests and are receptive to local programming. Each of the
Stations is affiliated with one of the national television networks, which
provides an established audience and reputation for national news, sports and
entertainment programming. With the established audiences provided by network
affiliations, management seeks to implement its strategy to enhance non-network
ratings and revenues while controlling costs.

STRATEGY

The Company's senior management team, led by A. Richard Benedek, Chairman
and Chief Executive Officer, and K. James Yager, President and Chief Operating
Officer, has extensive experience in acquiring and improving the operations of
television stations. The Company's primary operating strategy is to maximize
each Station's advertising revenue through local news, information and
community-oriented programming that has broad audience appeal and value-added
sales potential, while maintaining strict cost controls. Key elements of
management's strategy include:

LOCAL NEWS LEADERSHIP AND LOCAL PROGRAMMING. Management believes that local
news and informational programming leadership contributes to higher ratings and,
therefore, increased advertising

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revenues. Management's emphasis on local and ongoing community involvement
allows the Stations to maximize the advertising rates they can charge
local, regional and national accounts, not only for news, but for network
and nationally-syndicated programming which the Stations broadcast in time
periods adjacent to regularly scheduled local newscasts and local news
specials.

The Company has focused on maintaining and building each Station's
local news franchise as the key element in its strategy to build and
maintain audience loyalty. Management believes that strong,
well-differentiated local news programming attracts high viewership levels,
particularly of demographic groups that are appealing to both local and
national advertisers, thereby allowing the Company to maximize advertising
rates.

The Company believes that television stations with a prominent local
identity and active community involvement can realize additional revenues
from local advertisers through the development and sale of special
promotional programming. The Stations have developed high-quality
programming which highlights community events and topics of local interest.
Locally produced programming includes "Our Town" segments featuring local
news reports, special promotional announcements and local advertising
focused on communities within a particular market; "Town Meetings," which
provide a forum for members of local communities to discuss and debate
issues of local concern; "Live Line" programs on health, money and legal
matters in which viewers call in to a panel of local experts; and home
shopping programs sold exclusively to local merchants. The Stations also
sell promotional advertising packages tied to various local events such as
youth expos, county fairs, parades, athletic events and other local
activities. These local programs have proven successful in attracting
incremental advertising revenues and are a core element of each Station's
local identity.

SYNDICATED PROGRAMMING. The Company selectively purchases first run and
off-network syndicated programming designed to reach specific demographic
groups attractive to advertisers. Currently, the four most highly-rated
syndicated programs in the United States are "The Oprah Winfrey Show,"
"Home Improvement," "Wheel of Fortune" and "Jeopardy." The Company
broadcasts "The Oprah Winfrey Show" on seven of the Stations, "Home
Improvement" on seven of the Stations, "Wheel of Fortune" on twelve of the
Stations and "Jeopardy" on eight of the Stations. Additionally, the Company
recently began broadcasting the newly syndicated "The Rosie O'Donnell Show"
on four of the Stations and "Seinfeld" on five of the Stations. The Company
broadcasts other highly-rated first run syndicated programs on several of
the Stations including "Live with Regis & Kathie Lee," "Montel Williams"
and "Maury Povich." A number of the Stations also broadcast other
highly-rated off-network syndicated programming including "Cheers,"
"M*A*S*H" and "Roseanne."

The Company seeks to acquire programs that are available on a
cost-effective basis for limited licensing periods, allow scheduling
flexibility, complement each Station's overall programming mix and counter
competitive programming. The Company has been able to purchase syndicated
programming at attractive rates in part as a result of the limited
competition for such programming in the Company's markets. As a result of
the limited competition from other broadcasters purchasing syndicated
programming in the small and medium-sized markets served by the Company,
program expense as a percentage of net revenues for the Stations was 4.2%
and 3.4% in 1995 and 1996, respectively.

LOCAL SALES EMPHASIS. Management's sales strategy focuses on increasing
the sale of local advertising by attracting new advertisers to television
and increasing the amount of advertising dollars being spent by existing
local advertisers. Management of the Company believes that its leadership
in local news and informational programming enhances its ability to develop
and attract local advertising

-3-

expenditures. Management believes that through local sales efforts it can
stimulate local advertising expenditures more readily than it can national
advertising expenditures. This enables the Company to react promptly to
changes in the national and local advertising climate.

Trained and experienced sales personnel sell local advertising for the
Company in each of its markets. The Company focuses on local advertisers by
producing their commercials, producing news and informational programming
with local advertising appeal and sponsoring or co-promoting local events
and activities that give local advertisers unique value-added community
identity. Approximately 59% of the Company's revenues in 1996 were
generated from local and regional advertisers. Local and regional revenues
for the Benedek Stations increased 53.5% from 1991 to 1995 compared to a
42.7% increase in the national spot television revenues of the Benedek
Stations during the same period.

FINANCIAL PLANNING AND CONTROLS. The Company emphasizes strict control
of programming and operating costs as an important factor in increasing
broadcast cash flow. The Company continually seeks to identify and
implement cost savings opportunities. Management of the Company believes
that controlling costs is an essential factor in achieving and maintaining
profitability. The Company intends to continue to identify opportunities to
increase Adjusted EBITDA through its ongoing strategic planning and
budgeting process.

FUTURE ACQUISITIONS AND OPPORTUNITIES. The Company has a long-term
strategy to pursue additional acquisitions of broadcast television
stations, primarily of network-affiliated stations in small to medium-sized
markets where the Company believes it can successfully implement its
operating strategy and where such stations can be acquired on financially
acceptable terms. Additionally, a rule making proceeding is currently
pending before the FCC regarding possible relaxation of the local
television duopoly rules. If these rules are implemented, the Company
intends to explore opportunities to enter into local marketing agreements
with other stations in markets where it currently operates. Except for
arrangements to acquire low power television licenses in Columbia and
Jefferson City, Missouri which the Company expects to complete in the
second quarter of fiscal 1997, the Company does not have any understandings
or agreements with respect to any acquisitions or local marketing
agreements.

INDUSTRY BACKGROUND

Commercial television broadcasting began in the United States on a regular
basis in the 1940's. Currently, there are a limited number of channels available
for broadcasting in any one geographic area, and the license to operate a
broadcast station is granted by the FCC. Television stations can be
distinguished by the frequency on which they broadcast. Television stations
which broadcast over the very high frequency ("VHF") band (channels 2-13) of the
spectrum generally have some competitive advantage over television stations
which broadcast over the ultra-high frequency ("UHF") band (channels 14-69) of
the spectrum because VHF channels typically cover larger geographic areas and
operate at a lower transmission cost. However, specific market characteristics
such as population densities, geographic features or other factors may determine
whether UHF stations are in fact at a competitive disadvantage.

-4-

advertising media in the market area. The extent of advertising expenditures,
which are sensitive to broad economic trends, has historically affected the
broadcast industry.

Whether or not a station is affiliated with one of the four major networks
(ABC, CBS, NBC or Fox) may have a significant impact on the composition of the
station's programming, revenues, expenses and operations. A typical network
affiliate receives a significant portion of its daily programming from the
network. This programming, together with cash payments, is provided to the
affiliate by the network in exchange for a substantial majority of the
advertising time sold during the broadcast of network programming. The Fox
network has operating characteristics which are similar to ABC, CBS and NBC,
although the hours of network programming produced for Fox affiliates is less
than that produced by the other major networks. In addition, UPN and the Warner
Bros. Network recently have been launched as new television networks. However,
neither produce a significant amount of network programming.

Through the 1970's, network television broadcasting generally enjoyed
dominance in viewership and television advertising revenues. FCC regulation
evolved to address this dominance, with the focus on increasing competition and
diversity of programming in the television broadcasting industry. See "--Federal
Regulation of Television Broadcasting."

Cable and television systems were first installed in significant numbers in
the late 1960's and early 1970's and were initially used to retransmit broadcast
television programming in areas with poor broadcast signal reception. According
to the 1996 Television & Cable Factbook, cable television currently passes
approximately 90% of all television households nationwide and approximately 62%
of such households are cable subscribers. Cable-originated programming has
emerged as a significant competitor for viewers of broadcast television
programming. With increased cable penetration, the cable programming share of
advertising revenues has increased. Notwithstanding increased cable viewership
and advertising, broadcast television remains the dominant distribution system
for mass market television advertising. No single cable programming network
regularly attains audience levels amounting to more than a small fraction of any
single major broadcast network. Despite the growth in the alternative
programming from cable, according to Nielsen, 60% of all prime time television
viewing time during the 1995-1996 broadcast season was spent viewing ABC, CBS,
NBC and Fox programming.

Other developments have also affected television programming and delivery.
Independent stations have emerged as viable competitors for television
viewership share, particularly as the result of the availability of first run
network programming from UPN and the Warner Bros. Network. In addition, there
has been substantial growth in the number of home satellite dish receivers and
VCRs, which has further expanded the number of programming alternatives for
television audiences. Furthermore, direct broadcast services ("DBS") to homes
from satellites became available on a nationwide basis during 1994. See
"--Competition."

BACKGROUND OF THE COMPANY

The Company was incorporated under the laws of the State of Delaware on
April 10, 1996. Benedek Broadcasting Corporation ("Benedek Broadcasting") was
incorporated under the laws of the State of Delaware on January 22, 1979. On
June 6, 1996, as part of the acquisition of the Stauffer Stations and the
Brissette Stations, Benedek Broadcasting became a wholly-owned subsidiary of the
Company. In March 1995, Blue Grass Television, Inc. ("Blue Grass") and
Youngstown Broadcasting Co., Inc. ("Youngstown") were merged into Benedek
Broadcasting (the "Merger"). Prior to the Merger, all of the outstanding common

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stock of Benedek Broadcasting, Blue Grass and Youngstown was owned by Mr. A.
Richard Benedek, the sole stockholder of the Company.

Benedek Broadcasting acquired WTAP-TV in October 1979; WIFR-TV, WHSV-TV and
KHQA-TV in December 1986; WTOK-TV in June 1988; WTVY-TV in March 1995. Blue
Grass acquired WBKO-TV in April 1983; and KDLH-TV in July 1985. Youngstown
acquired WYTV in June 1983.

The Company's principal executive offices are located at 100 Park Avenue,
Rockford, Illinois 61101.

NETWORK AFFILIATION OF THE STATIONS

Each of the Stations is affiliated with either ABC, CBS or NBC pursuant to
an affiliation agreement (an "Affiliation Agreement"). Each Affiliation
Agreement provides the affiliated Station with the right to broadcast all
programs transmitted by the network with which the Station is affiliated. In
return, the network has the right to sell a substantial majority of the
advertising time during such broadcasts. In exchange for every hour that a
Station elects to broadcast network programming, the network pays the Station a
specified fee, which varies with the time of day. Typically, prime-time
programming generates the highest hourly rates. Rates are subject to increase or
decrease by the network during the term of an Affiliation Agreement, with
provisions for advance notices and the right of termination by the Station in
the event of a reduction of rates.

Each of the Stations' network affiliation agreements currently runs for a
period of five to ten years. WYTV, WBKO-TV, WTOK-TV and WHSV-TV, all of which
are ABC affiliates, each have a five-year affiliation agreement which expires in
1999. KMIZ-TV, an ABC affiliate, operates under an affiliation agreement which
expires in 2000 and is automatically renewed for successive terms, subject to
either party's right to terminate the agreement at the end of its term upon 180
days' advance notice. WHOI-TV, an ABC affiliate, currently operates under an
affiliation agreement which expires in 2005 and which does not provide for
renewals. KDLH-TV, WIFR-TV, KHQA-TV, WTVY-TV, KGWN-TV, KGWC-TV, KCOY-TV,
WIBW-TV, WSAW-TV, WTRF-TV, KAUZ-TV and KOSA-TV, all of which are CBS affiliates,
each have a ten-year affiliation agreement which expires in 2005 and is
automatically renewed for successive five-year terms, subject to either party's
right to terminate the agreement at the end of any term upon six months' advance
notice. WMTV-TV, WWLP-TV and WILX-TV, all of which are NBC affiliates, each have
an affiliation agreement which expires in 2006 and is automatically renewed for
successive five-year terms, subject to either party's right to terminate the
agreement at the end of any term upon six months' advance notice. WTAP-TV, an
NBC affiliate, currently operates under a five-year affiliation agreement which
expires in 2000 and is automatically renewed for successive terms, subject to
either party's right to terminate the agreement at the end of any term upon 12
months' advance notice.

In December 1995, the Company entered into new long-term affiliation
agreements with CBS effective retroactive to July 1, 1995 on behalf of KDLH-TV,
WIFR-TV and KHQA-TV and agreed to extend the term of the affiliation agreement
for WTVY from 2004 to 2005. In connection with such arrangements, CBS paid the
Company bonus payments of $2.5 million in the fourth quarter of 1995 and $2.5
million in the first quarter of 1996. These payments will be recognized as
revenue by the Company at the rate of $0.5 million per year over the ten-year
period of the affiliation agreements. The Company also agreed with CBS that,
upon the consummation of the Acquisitions, the term of the affiliation
agreements of the Stauffer Stations

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that are CBS affiliates would be extended from 2000 to 2005 and the term of the
affiliation agreements of the Brissette Stations that are CBS affiliates will be
extended from 2004 to 2005.

In addition to its affiliation agreements, the Company entered into
agreements with Fox to broadcast football games of the National Football
Conference ("NFC") of the National Football League and certain other Fox
programming in non-network time periods for the 1995 and 1996 broadcast seasons.
In 1996, the Company aired the NFC football games and other Fox programming on
KHQA-TV, WHSV-TV, WTOK-TV, WYTV, KCOY-TV and KMIZ-TV. The Company believes that
broadcasting NFC football games increased its audience ratings during the times
the games were broadcast.

The Company recently announced that it had reached an agreement in
principle with The Warner Bros. Television Network to develop a local cable
affiliate called the "WeB" in each of the Company's 20 markets which rank above
100. The WeB is intended to be a 24 hour, seven day a week television channel
which will broadcast Warner Bros. Network prime time programming, WB Kids
programming and syndicated programming of Warner Bros. and others. The WeB is
scheduled to begin service by September 1998 in most 100-plus markets. The
Company will be responsible for all local sales efforts for the new channels in
its markets. The Company does not anticipate a significant effect on operations
during 1997 nor does it anticipate that significant capital expenditures will be
required in connection with the development of its WeB affiliates.

ADVERTISING SALES

Television station revenues are primarily derived from local, regional and
national advertising and, to a modest extent, from network compensation and
revenues from tower rentals and commercial production activities. Advertising
rates are based upon numerous factors including a program's popularity among the
viewers an advertiser wishes to target, the number of advertisers competing for
the available time, the size and demographic composition of a program's audience
and the availability of competing or alternative advertising media in the market
area. Because broadcast television stations rely on advertising revenue,
declines in advertising budgets, particularly in recessionary periods, adversely
affect the broadcast industry and as a result may contribute to a decrease in
the revenues of broadcast television stations. The Company seeks to manage its
spot inventory efficiently thereby maximizing advertising rates.

Local Sales. Approximately 59% of the gross revenues of the Stations in
1996 came from local and regional advertisers. Local and regional advertising is
sold primarily by each Station's professional sales staff. Typical local and
regional advertisers include automobile dealerships, retailers, local grocery
chains, soft drink bottlers, hospitals, state lotteries and restaurants. The
Company focuses on local advertisers by producing their commercials, producing
news and informational programming with local advertising appeal and sponsoring
or co-promoting local events and activities that give local advertisers
value-added community identity. The Company's management team monitors sales
plans and promotional activities and shares such information among the Stations
on a regular basis.

National Sales. Approximately 32% of the gross revenues of the Stations in
1996 came from national advertisers. Typical national advertisers include
automobile manufacturers, consumer goods manufacturers, communications
companies, fast food franchisers, national retailers and direct marketers.
National advertising time is sold through representative agencies retained by
the Company. Six of the Stations are represented by Katz Communications, Inc.,
eight Stations are represented by Petry, five retain Harrington, Righter &
Parsons, LLP as their national sales representative, and three are represented
by Telerep. The

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Stations' national sales coordinators actively assist their national sales
representatives to induce national advertisers to increase their national spot
expenditures designated to the Company's markets.

RATING SERVICE DATA

All television stations in the United States are grouped into 211
television markets which are ranked in size according to the number of
television households in such markets. Nielsen periodically publishes reports on
the estimated audience for the television stations in the various television
markets throughout the country. The audience estimates are expressed in terms of
the percentage of the total potential audience in a market viewing a particular
station (the station's "rating") and of the percentage of households actually
viewing television (the station's "share"). The ratings reports provide data on
the basis of total television households and selected demographic groupings in
15-minute or half-hour increments for a particular market. Nielsen calls each
specific geographic market a DMA. Every county in the continental United States
is assigned to a DMA of a specific television market on an exclusive basis. In
larger markets, ratings are determined by a combination of meters connected
directly to selected television sets (the results of which are reported on a
daily basis) and weekly diaries of television viewing prepared by the actual
viewers. In smaller markets only weekly diaries are completed during four
separate four-week periods during the course of any year. These periods are
commonly knows as "sweeps periods." All the Company's markets are measured
during these sweeps periods.

-8-

The following table sets forth certain information for each of the stations and
the markets they serve. Television audience share, station rank and cable
penetration are based on data compiled from the November 1996 Nielsen surveys:

Number of
Commercial Station
Market Call Network Stations in Rank In Station Cable
Market Area Rank Letters Channel(c) Affiliation Market Market Share Penetration
----------- ---- ------- ------- ----------- ------ ------ ----- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>

Madison, Wisconsin 84 WMTV-TV 15 NBC 4 2 16% 61.5%

Youngstown, Ohio 95 WYTV 33 ABC 3 3 17% 73.0%

Springfield and Holyoke, Massachusetts 102 WWLP-TV 22 NBC 2 1 24% 81.8%

Lansing, Michigan 106 WILX-TV 10 NBC 4 2 15% 66.0%

Peoria and Bloomington, Illinois 110 WHOI-TV 19 ABC 4 3 14% 72.0%

Santa Barbara, Santa Maria and 115 KCOY-TV 12 CBS 3 3 12% 84.0%
San Luis Obispo, California

Duluth, Minnesota and Superior,
Wisconsin 134 KDLH-TV 3 CBS 3 3 16% 52.7%

Rockford, Illinois 135 WIFR-TV 23 CBS 4 2 17% 71.0%

Wausau and Rhinelander, Wisconsin 136 WSAW-TV 7 CBS 3 2 24% 50.6%

Wheeling, West Virginia and 139 WTRF-TV 7 CBS 2 2 17% 78.0%
Steubenville, Ohio

Topeka, Kansas 141 WIBW-TV 13 CBS 4 1 22% 73.1%

Wichita Falls, Texas and Lawton,
Oklahoma 143 KAUZ-TV 6 CBS 4 2 15% 69.0%

Columbia and Jefferson City, Missouri 145 KMIZ-TV 17 ABC 3 3 13% 61.0%

Odessa and Midland, Texas 151 KOSA-TV 7 CBS 4 4 11% 73.5%

Quincy, Illinois and Hannibal, Missouri 158 KHQA-TV 7 CBS 2 1 24% 61.0%

Dothan, Alabama 174 WTVY-TV 4 CBS 3 1 28% 69.0%

Panama City, Florida 159 WTVY-TV 4 CBS 4 3 11% 68.3%

Harrisonburg, Virginia 178 WHSV-TV 3 ABC 1 1 23% 74.0%

Bowling Green, Kentucky 182 WBKO-TV 13 ABC 2 1 32% 56.7%

Meridian, Mississippi 183 WTOK-TV 11 ABC 3 1 30% 52.4%

Parkersburg, West Virginia 186 WTAP-TV 15 NBC 1 1 31% 76.4%

Cheyenne, Wyoming, Scottsbluff, 194 KGWN-TV 5 CBS 4 1(e) 17%(e) 73.0%(e)
Nebraska and Sterling, Colorado 194 KSTF-TV(a) 10 CBS (d) (e) (e) (e)
194 KTVS-TV(a) 3 CBS (d) (e) (e) (e)

Casper and Riverton, Wyoming 197 KGWC-TV 14 CBS 3 3(f) 8%(f) 67.0%(f)
197 KGWL-TV(b) 5 CBS (d) (f) (f) (f)
197 KGWR-TV(b) 13 CBS (d) (f) (f) (f)
- ---------------------------
</TABLE>

(a) Satellite station of KGWN-TV.
(b) Satellite station of KGWC-TV.

(c) Channels 2 through 13 are broadcast over the very high frequency (VHF) band
of the broadcast spectrum and channels 14 through 69 are broadcast over the
ultra-high frequency (UHF) band of the broadcast spectrum.
(d) Satellite stations are not considered distinct stations in this market for
Nielsen purposes.
(e) Station Rank, Station Share and Cable Penetration information for KGWN-TV
includes data for satellite stations KSTF-TV, Scottsbluff, Nebraska and
KTVS-TV, Sterling, Colorado, as reported by Nielsen.
(f) Station Rank, Station Share and Cable Penetration information for KGWC-TV
includes data for satellite stations KGWL-TV, Lander, Wyoming and KGWR-TV,
Rock Springs, Wyoming, as reported by Nielsen.

-9-

WMTV-TV (NBC) MADISON, WISCONSIN

Market Description. The Madison DMA consists of 11 counties in southwestern
Wisconsin. Recent growth in the area has increased the population in the Madison
DMA, moving it from the 93rd largest market in 1991 to the 84th largest market
in 1996. Madison, the Wisconsin state capital, is located in southcentral
Wisconsin, 150 miles north of Chicago, Illinois and 75 miles west of Milwaukee,
Wisconsin. The Madison economy is a diverse and stable balance of the
industrial, governmental and service sectors. Additionally, agricultural
production of corn, alfalfa, tobacco, oats, eggs, cattle, hogs and, of course,
dairy products have greatly contributed to further stability in the local
economy. Many of the country's leading insurance companies, including American
Family Mutual Insurance Group, CUNA Mutual Insurance Group and General Casualty
have facilities in Madison. Other prominent corporations with facilities in the
area include General Motors Corporation, Meriter Health Services, Oscar Mayer
Foods Corporation, Famous Footwear, Lands' End and Rayovac Corporation. Madison
is also home to the University of Wisconsin, with approximately 40,000 students.

Station History and Characteristics. WMTV-TV was originally licensed in
1953 to serve Madison, Wisconsin. The Madison market is ranked 84th in the
United States, with approximately 312,000 television households and a population
of approximately 775,000. WMTV-TV is broadcast on UHF channel 15 and is an NBC
affiliate. There are three other commercial television stations in the Madison
DMA, a CBS affiliate which broadcasts on a VHF channel and ABC and Fox
affiliates which broadcast on UHF channels.

WYTV (ABC) YOUNGSTOWN, OHIO

Market Description. The Youngstown DMA consists of four counties, three of
which are in northeastern Ohio and one of which is in western Pennsylvania.
Youngstown is situated in northeastern Ohio along the Ohio/Pennsylvania border
within 65 miles of Cleveland, Ohio to the northwest and Pittsburgh, Pennsylvania
to the southeast. The Youngstown economy is historically based on processing of
pig iron and steel. While still part of a major steel producing area,
Youngstown's economy has diversified to include manufacturing, warehousing and
distribution companies. Some of the major employers in the area include the
Buick, Oldsmobile and Cadillac Division of General Motors Corporation, the
Packard Electric Corporation Division of General Motors Corporation, St.
Elizabeth's Medical Center, Western Reserve Care System and LTV Steel Tubular
Products Division of Republic Steel Works. This area is also the home of
Youngstown State University with approximately 16,000 students.

Station History and Characteristics. WYTV was originally licensed in 1953
to serve Youngstown, Ohio. The Youngstown market is ranked 95th in the United
States, with approximately 275,000 television households and a population of
approximately 694,000. WYTV is broadcast on UHF channel 33 and is an ABC
affiliate. The Company acquired WYTV in 1983. The other local stations with
which WYTV competes are also UHF stations, one of which is an NBC affiliate and
the other of which is a CBS affiliate.

WWLP-TV (NBC) SPRINGFIELD AND HOLYOKE, MASSACHUSETTS

Market Description. The Springfield-Holyoke DMA consists of three counties
in midwestern Massachusetts running north to south between the New
Hampshire/Vermont and Connecticut state borders. Springfield is located in the
Pioneer Valley, approximately 25 miles north of Hartford, Connecticut and 85
miles east of Boston, Massachusetts. The Springfield economy has a diversified
industrial base. The area's most prominent employers include Massachusetts
Mutual Life Insurance Company, Milton Bradley, Inc., Monsanto Company, Friendly
Ice Cream Corporation, Spalding Sports Worldwide, Stanhome, Inc. and Baystate
Medical Center. Many universities and colleges are located in this region,
including the University of Massachusetts, with a student population of
approximately 23,000, Amherst College, Smith College and Mount Holyoke College.
Springfield is also the home of Naismith Memorial Basketball Hall of Fame.

Station History and Characteristics. WWLP-TV was originally licensed in
1953 to serve the greater Springfield area. Springfield-Holyoke is the 102nd
largest market in the United States, with approximately

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242,000 television households and a population of approximately 613,000. WWLP-TV
is broadcast on UHF channel 22 and is an NBC affiliate. The only other
commercial television station in this market is an ABC affiliate which also
broadcasts on a UHF channel. WWLP-TV also competes with a CBS affiliate on a VHF
channel and, to a lesser extent, a Fox affiliate on a UHF channel both of which
are broadcast from Hartford, Connecticut.

WILX-TV (NBC) LANSING, MICHIGAN

Market Description. The Lansing DMA consists of five counties in
southcentral Michigan. Lansing is the state capital of Michigan and is located
approximately 75 miles west of Detroit, Michigan. The Lansing economy, though
recently diversified, is still a stronghold of the automotive industry.
Prominent employers in the area include General Motors Corporation (Oldsmobile
Worldwide Headquarters), Meijer, Inc., Michigan Capital Healthcare and Michigan
National Bank. Additionally, there are many smaller companies, employing in
excess of 3,000 people, that provide auto parts to General Motors. Lansing is
also home to the largest university in Michigan, Michigan State University, with
more than 40,000 students and 12,000 faculty and staff.

Station History and Characteristics. WILX-TV was originally licensed in
1957 to Onondaga, Michigan. The Lansing market is ranked 106th in the United
States, with approximately 231,000 television households and a population of
approximately 589,000. WILX-TV is broadcast on VHF channel 10 and is an NBC
affiliate. WILX-TV competes with three other commercial stations in this market,
a CBS affiliate which also broadcasts on a VHF channel and ABC and Fox
affiliates which broadcast on UHF channels.

WHOI-TV (ABC) PEORIA AND BLOOMINGTON, ILLINOIS

Market Description. The Peoria-Bloomington DMA consists of 10 counties
located in central Illinois. Peoria is located approximately 150 miles southwest
of Chicago, Illinois and 170 miles north of St. Louis, Missouri. The major
economic sectors in the area include agriculture, manufacturing and information
technology. Prominent employers in the greater Peoria area include Caterpillar,
Inc., State Farm Insurance, Saint Francis Medical Center, Diamond Star Motors
and Methodist Medical Center. This area is also home to Illinois State
University, with approximately 18,000 students and 3,100 employees, as well as
Bradley University and the University of Illinois School of Medicine.

Station History and Characteristics. WHOI-TV was originally licensed in
1953 to serve Peoria, Illinois. The Peoria-Bloomington market is ranked 110th in
the United States, with approximately 225,000 television households and a
population of approximately 562,000. WHOI-TV is broadcast on UHF channel 19 and
is an ABC affiliate. There are three other commercial stations in this market,
affiliates of CBS, NBC and Fox. All of these competitor stations are also
broadcast on UHF channels.

KCOY-TV (CBS) SANTA BARBARA, SANTA MARIA AND SAN LUIS OBISPO, CALIFORNIA
Market Description. The Santa Barbara - Santa Maria - San Luis Obispo DMA
consists of three counties on the southcentral coast of California. Santa Maria
is approximately 170 miles north of Los Angeles and 270 miles south of San
Francisco. The region has a stable economic base which includes agriculture,
transportation, oil, tourism and manufacturing. Prominent corporations with
facilities in the area include Raytheon Company, Delco Systems Operations,
Chevron USA, Santa Barbara Research (a subsidiary of the Hughes Corporation),
Applied Magnetics Corp. and Lockheed-Martin. The area is also site of the
Vandenberg United States Air Force Base with approximately 8,400 military, civil
service and civilian employees. Additionally, the University of California at
Santa Barbara and California Polytechnic University, with an aggregate student
population of approximately 34,000, are located within this DMA.

Station History and Characteristics. KCOY-TV was originally licensed in
1964 to serve Santa Maria, California. The Santa Barbara - Santa Maria - San
Luis Obispo market is ranked 115th in the United States, with approximately
214,000 television households and a population of approximately 564,000. KCOY-TV

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is broadcast on VHF channel 12 and is a CBS affiliate. There are three other
commercial stations in this market, ABC and NBC affiliates which broadcast on
VHF channels and an independent station which broadcasts on a UHF channel. Until
recently, KCOY-TV was negatively impacted by the cable television retransmission
in Santa Barbara of KCBS-TV, Los Angeles, California. However, in September
1995, KCOY-TV was granted nonduplication protection against KCBS-TV and is now
the only CBS affiliate whose programming is available on the Santa Barbara cable
system.

KDLH-TV (CBS) DULUTH, MINNESOTA AND SUPERIOR, WISCONSIN

Market Description. The Duluth-Superior DMA consists of 13 counties, seven
of which are in northeastern Minnesota, five of which are in northwestern
Wisconsin and one of which is in the upper peninsula of Michigan. Duluth,
Minnesota and Superior, Wisconsin are adjacent to each other and are
approximately 150 miles from Minneapolis, Minnesota. The Duluth-Superior
economy, historically based on mining and shipping, also includes the fishing,
food products, paper, education, medical, timber and tourism industries. Duluth
is one of the major United States ports from which iron ore, taconite, coal,
lumber, cement, grain, paper and chemicals are shipped. Prominent corporation
with facilities in the area include Minnesota Power, US West Communications,
Duluth, Missabe & Iron Range Railway Co., Louis Kemp Seafood Co., Lake Superior
Paper Industries, Potlatch Corporation, Boise Cascade, Burlington Northern Sante
Fe Railway, Georgia-Pacific Corporation, U.S. Steel, National Steel Pellet Co.
and NorWest Bank-Minnesota North. The region is also host to a number of
colleges and universities, including the University of Minnesota-Duluth ("UMD"),
UMD Medical School, College of St. Scholastica, Northland College and the
University of Wisconsin-Superior. In addition, the area's extensive forests and
numerous lakes have fostered a local tourism industry and attract thousands of
tourists annually who camp, hike, ski, fish and boat in hundreds of state and
federal parks.

Station History and Characteristics. KDLH-TV was originally licensed in
1954 to serve the Duluth, Minnesota-Superior, Wisconsin metropolitan area. The
Duluth-Superior market is ranked 134th in the United States, with approximately
169,000 television households and a population of approximately 407,000. KDLH-TV
is broadcast on VHF channel 3 and is a CBS affiliate. The Company acquired
KDLH-TV in 1985. KDLH-TV competes with both an ABC and NBC affiliate which are
also broadcast on VHF channels.

WIFR-TV (CBS) ROCKFORD, ILLINOIS

Market Description. The Rockford DMA consists of five counties in northern
Illinois. Rockford is approximately 80 miles west of Chicago, Illinois. The
Rockford economy historically centered on manufacturing, has recently
diversified with the growth of service-based industries such as insurance and
financial services. Nevertheless, manufacturing still represents the largest
source of private employment in Rockford, known as the "Fastener Capital of the
World." Prominent corporations with facilities located in the greater Rockford
area include Chrysler Corporation, Sundstrand Corporation, Ingersoll Milling
Machine Co., Barber-Colman Company, Newell Company, Elco Industries, Inc. and
Warner-Lambert Company. One of the largest employers in the service industry in
this area is Rockford Memorial Hospital. Other service industry employers in the
area include Pioneer Life Insurance Company, AMCORE Bank, N.A., Aetna Life &
Casualty and Blue Cross/Blue Shield of Illinois. Additionally, United Parcel
Service completed construction of a major facility at the Rockford Airport in
late 1994, which functions as its distribution center for the entire mid-western
region of the United States.

Station History and Characteristics. WIFR-TV was licensed in 1965 to
Freeport, Illinois to serve the greater Rockford market. Rockford is the 135th
largest market in the United States, with approximately 166,000 television
households and a population of approximately 422,000. WIFR-TV is broadcast on
UHF channel 23 and is a CBS affiliate. The Company acquired WIFR-TV in 1986.
There are three other licensed commercial television stations in the Rockford
market, of which two are UHF stations and one is a VHF station. Although the VHF
station's signal extends to a larger geographical area than any of the UHF

-12-

stations, including WIFR-TV, such area is outside the Rockford DMA and does not
impact audience ratings or shares within the DMA. The other three stations in
this market are affiliated with ABC, NBC and Fox.

WSAW-TV (CBS) WAUSAU AND RHINELANDER, WISCONSIN

Market Description. The Wausau-Rhinelander DMA consists of 13 counties in
central Wisconsin bisected by the Wisconsin River. Wausau is approximately 90
miles west of Green Bay, Wisconsin and 180 miles east of Minneapolis, Minnesota.
The Wausau economy, historically based on the timber industry, has diversified
into the farming, manufacturing and service sectors. The area continues to be
one of the nation's leading producers of cheese and ginseng. Prominent
corporations with facilities in the greater Wausau area include Wausau Insurance
Companies, Sentry Insurance, Kolbe & Kolbe Millwork, Inc., Weyerhauser Co.,
Harley-Davidson, Consolidated Papers, Inc., Ore-Ida Foods, Inc., Marathon Cheese
Corp. and Georgia-Pacific Corporation. The area is also home to the University
of Wisconsin-Stevens Point with approximately 10,000 students and the University
of Wisconsin-Marathon Center with a student population of approximately 1,300.

Station History and Characteristics. WSAW-TV was originally licensed in
1954 to serve Wausau, Wisconsin. The Wausau-Rhinelander market is ranked 136th
in the United States, with approximately 164,000 television households and a
population of approximately 421,000. WSAW-TV is broadcast on VHF channel 7 and
is a CBS affiliate. WSAW-TV competes with affiliates of ABC and NBC which are
also broadcast on VHF channels.

WTRF-TV (CBS) WHEELING, WEST VIRGINIA AND STEUBENVILLE, OHIO
Market Description. The Wheeling-Steubenville DMA consists of 12 counties,
six of which are in northwestern West Virginia and six of which are in eastern
Ohio. Located in the Ohio Valley, Wheeling and Steubenville are situated along
opposite sides of the Ohio River approximately 25 miles apart. Wheeling is
approximately 55 miles southwest of Pittsburgh, Pennsylvania and approximately
120 miles east of Columbus, Ohio. The area's economy, historically based on
heavy manufacturing, has diversified into the manufacturing, services and
advanced technology sectors. Prominent corporations with facilities in this
region include Wheeling Pittsburgh Steel Corporation, TIMET, Bayer, Inc., PPG
Industries and Consolidation Coal Company. Wheeling is also home to the National
Technology Transfer Center, an independent organization formed to provide
private business and industry with a central access point for the knowledge and
data gathered by the Federal Government's 100,000 research professionals.

Station History and Characteristics. WTRF-TV was originally licensed in
1953 to serve the Wheeling, West Virginia market. The Wheeling-Steubenville
market is ranked 139th in the United States, with approximately 158,000
television households and a population of approximately 391,000. WTRF-TV is
broadcast on VHF channel 7 and is a CBS affiliate. There is one other commercial
station in this market, an NBC affiliate also broadcast on a VHF channel.

WIBW-TV (CBS) TOPEKA, KANSAS

Market Description. The Topeka DMA consists of 14 counties in northeastern
Kansas. Topeka, the capital of Kansas, is located near the geographic center of
the United States, approximately 60 miles west of Kansas City, Missouri and 120
miles south of Omaha, Nebraska. This area's diversified economy includes
concentrations in the agriculture, manufacturing and service industries. Major
employers in this market include Goodyear Tire & Rubber Company, Payless
ShoeSource, Jostons Printing and Publishing, Hallmark Cards, Inc., Frito-Lay,
Inc., Burlington Northern Santa Fe Railway, Blue Cross/Blue Shield of Kansas,
Stormont-Vail Regional Medical Center and Menninger Hospital and School of
Psychiatric Medicine. The region is also home to several universities including
the University of Kansas, Kansas State University, Washburn University of Topeka
and Emporia State University, with an aggregate student population in excess of
60,000.

-13-

Station History and Characteristics. WIBW-TV was originally licensed in
1953 to serve Topeka, Kansas. The Topeka market is ranked 141st in the United
States with approximately 154,000 television households and a population of
384,000. WIBW-TV is broadcast on VHF channel 13 and is a CBS affiliate. There
are three other commercial stations in the market, two of which are affiliates
of ABC and NBC broadcasting on UHF channels with smaller broadcast coverage than
WIBW-TV and a Fox affiliate which broadcasts on a low power frequency.

KAUZ-TV (CBS) WICHITA FALLS, TEXAS AND LAWTON, OKLAHOMA

Market Description. The Wichita Falls-Lawton DMA consists of 18 counties,
12 of which are in northcentral Texas and six of which are in southwestern
Oklahoma. Wichita Falls is located in the cross timbers section of the North
Central Plains of Texas, approximately 60 miles south of Lawton, Oklahoma and
approximately 125 miles from Dallas, Texas and Oklahoma City, Oklahoma. The
Wichita Falls-Lawton economy, historically based on agriculture, ranching and
petroleum, also includes the manufacturing, transportation, tourism and service
industries. Prominent corporations with facilities in the area include the
Cryovac Division of W.R. Grace & Co., the Mechanics Tool Division of Stanley
Works, Levi Strauss & Company, PPG Industries and Goodyear Tire & Rubber Co. In
addition, in 1995 the Texas Department of Criminal Justice ("TDCJ") opened its
James V. Allred Unit in Wichita Falls adding approximately 875 jobs to the area.
The TDCJ has announced expansion plans for this Unit which is expected to create
an additional 200 local jobs.

Station History and Characteristics. KAUZ-TV was originally licensed in
1953 to serve the Wichita Falls area. The Wichita Falls-Lawton market is ranked
143rd in the United States, with approximately 153,000 television households and
a population of approximately 391,000. KAUZ-TV is broadcast on VHF channel 6 and
is a CBS affiliate. KAUZ-TV competes with three other commercial stations in
this market, ABC and NBC affiliates which broadcast on VHF channels and a Fox
affiliate which broadcasts on a UHF channel.

KMIZ-TV (ABC) COLUMBIA AND JEFFERSON CITY, MISSOURI

Market Description. The Columbia-Jefferson City DMA consists of 13 counties
in central Missouri. Columbia and Jefferson City, approximately 30 miles apart,
are situated in the center of Missouri within 130 miles of Kansas City, Missouri
to the west and St. Louis, Missouri to the east. The Columbia-Jefferson City
economy is based primarily on education, health, insurance and agriculture.
Additionally, Jefferson City is the capital of Missouri adding governmental
employment to the economic base of the area that has been called a recession
resistant community due to its diversity and stable economy. Prominent
corporations with facilities in this market include Toastmaster, Inc., State
Farm Insurance Companies, Shelter Insurance Companies, Quaker Oats, Oscar Mayer
Foods Corporation, Scholastic Books, ABB Power T&D Company and A.B. Chance
Company. The area is also home to the University of Missouri, with approximately
24,000 students and 13,000 employees. In addition, the Fort Leonard Wood United
States Army Base and the Whitman United States Air Force Base are located within
this market.

Station History and Characteristics. KMIZ-TV was originally licensed
in 1971 to serve the Columbia-Jefferson City, Missouri area. The
Columbia-Jefferson City market is ranked 145th in the United States, with
approximately 147,000 television households and a population of approximately
356,000. KMIZ-TV is broadcast on UHF channel 17 and is an ABC affiliate. The two
other commercial stations in the market, affiliates of CBS and NBC, are
broadcast on VHF channels.

KOSA-TV (CBS) ODESSA AND MIDLAND, TEXAS

Market Description. The Odessa-Midland DMA consists of 19 counties, 18 of
which are in southwestern Texas and one of which is in southeastern New Mexico.
Odessa, the largest city in the Permian Basin, is approximately 275 miles east
of El Paso, Texas and 350 miles west of Dallas, Texas. The Odessa-Midland

-14-

economy is historically based on the oil and gas industry. The area has recently
diversified into the manufacturing and industrial service sectors, although ties
to the energy sector remain very significant. Some of the major employers in the
area include Phillips Petroleum Company, Exxon Corporation, the Shell Oil Co.
Odessa Refinery, EVI-Highland Pump Company, Rexene Corporation, Ref-Chem
Corporation, Texas Instruments Inc. and Medical Center Hospital. Odessa is also
home of the University of Texas of the Permian Basin, Texas Tech University
Health Sciences Center at Odessa and Odessa College, with an aggregate student
enrollment of approximately 7,000.

Station History and Characteristics. KOSA-TV was originally licensed in
1956 to serve Odessa, Texas. The Odessa-Midland market is ranked 151st in the
United States, with approximately 132,000 television households and a population
of approximately 375,000. KOSA-TV is broadcast on VHF channel 7 and is a CBS
affiliate. There are three other commercial stations in the market, ABC and NBC
affiliates which broadcast on VHF channels and a Fox affiliate which broadcasts
on a UHF channel.

KHQA-TV (CBS) QUINCY, ILLINOIS AND HANNIBAL, MISSOURI

Market Description. The Quincy-Hannibal DMA consists of 18 counties, eight
of which are in western Illinois, nine of which are in northeastern Missouri and
one of which is in southeastern Iowa. Quincy, Illinois and Hannibal, Missouri
are situated on opposite sides of the Mississippi River approximately 100 miles
northwest of St. Louis, Missouri. The Quincy-Hannibal economy is predominantly
agricultural. This market is considered one of the largest soybean, hog and corn
producing areas in the nation. Prominent corporations with facilities in this
market include Moorman Manufacturing Company, American Cyanamid Company,
Pillsbury, Inc., Quincy Soybean Co., Harris Corporation, Shaeffer Pen and
Buckhorn Rubber Products.

Station History and Characteristics. KHQA-TV was originally licensed in
1953 to serve the greater Quincy, Illinois-Hannibal, Missouri market. The
Quincy-Hannibal market is ranked 158th in the United States, with approximately
117,000 television households and a population of approximately 286,000. KHQA-TV
is broadcast on VHF channel 7 and is a CBS affiliate. The Company acquired
KHQA-TV in 1986. There is one other station in this market, an NBC affiliate
carried on a VHF channel.

WTVY-TV (CBS) DOTHAN, ALABAMA AND PANAMA CITY, FLORIDA

Market Description. WTVY-TV is one of the few stations in the United States
that serves two DMAs. The Dothan DMA consists of six counties, five of which are
in southeastern Alabama and one of which is in southwestern Georgia. Dothan is
located approximately 90 miles southeast of Montgomery, Alabama and 85 miles
north of Panama City, Florida. The Panama City DMA consists of nine counties in
the middle of the Florida Panhandle.

The Dothan economy, historically agricultural, is currently evenly
distributed among the service, manufacturing and agricultural sectors. Dothan is
known as the "Peanut Capital of the World." Peanuts account for half of the
area's farm income, with cattle, poultry, corn, wheat, soybeans, cotton, fruits
and vegetables making up the other half. Prominent corporations with facilities
in the area include the Sony Corporation, Perdue Farms, Inc., General Electric
Company and AAA Cooper Transport Company. Dothan is also home to the area's
largest regional shopping mall, two regional hospitals and five educational
institutions offering collegiate, technical and vocational studies. The Dothan
DMA is also the site of the Fort Rucker United States Army Aviation Station.

Panama City is the county seat of Bay County, Florida and is located on the
Gulf of Mexico at the mouth of St. Andrew's Bay. The Panama City economy is
heavily based on year-round tourism as a result of its affordability when
compared to other Florida beach areas. Prominent corporations in the area
include Champion Paper Company and Stone Container Corporation, as well as more
than 100 other manufacturers. The Panama City DMA is the site of the Tyndall
United States Air Force Base and the Coastal Systems Station of the United
States Navy.

-15-

Station History and Characteristics. WTVY-TV, originally licensed in 1955
to serve the Dothan, Alabama metropolitan area, currently serves the DMA's of
Dothan, Alabama and Panama City, Florida. The Dothan market is ranked 174th in
the United States, with approximately 86,000 television households and a
population of approximately 219,000, while the Panama City marked is ranked
159th with approximately 110,000 television households and a population of
approximately 275,000. If combined, these two markets would rank as the 123rd
largest market in the United States. WTVY-TV is broadcast on VHF channel 4 and
is a CBS affiliate. The Company acquired WTVY-TV on March 31, 1995. WTVY-TV
competes with two other stations in the Dothan market, affiliates of ABC and Fox
which broadcast on UHF channels. In the Panama City market, WTVY-TV competes
with three other commercial stations, affiliates of ABC and NBC which broadcast
on VHF channels and a Fox affiliate which broadcasts on a UHF channel.

WHSV-TV (ABC) HARRISONBURG, VIRGINIA

Market Description. The Harrisonburg DMA consists of four counties, two of
which are in northwestern Virginia and two of which are in northeastern West
Virginia. Harrisonburg is located in the Shenandoah Valley between the
Appalachian and Blue Ridge Mountains, approximately 110 miles west of
Washington, D.C. and 110 miles northwest of Richmond, Virginia. The Harrisonburg
economy has been growing rapidly over the past several years. Several prominent
companies have established regional operations in the Harrisonburg market,
including the Coors Brewing Company and R.R. Donnelly & Sons Co., Inc. Other
companies in this area include Rocco Turkey, Inc., WLR Foods, Inc., Tyson Foods,
Inc., Hershey Co., Owens-Brockway Plastics & Closures and Merck & Co., Inc.
Harrisonburg is also the home of James Madison University, the largest state
university in the Virginia University system with approximately 13,000 students.

Station History and Characteristics. Since its inception in 1953, WHSV-TV
has been the only VHF commercial television station serving the Harrisonburg
market. The Harrisonburg market is ranked 178th in the United States, with
approximately 80,000 television households and a population of approximately
199,000. WHSV-TV is broadcast on VHF channel 3 and is an ABC affiliate. The
Company acquired WHSV-TV in 1986. The Station is also carried on UHF translator
on channel 64 in the adjacent Charlottesville, Virginia market. The higher costs
for advertising in surrounding urban areas results in a competitive advantage
for WHSV-TV in attracting advertising revenues.

WBKO-TV (ABC) BOWLING GREEN, KENTUCKY

Market Description. The Bowling Green DMA consists of seven counties in
southcentral Kentucky. Bowling Green is approximately 110 miles south of
Louisville, Kentucky and 60 miles north of Nashville, Tennessee. Bowling Green
lies between two different geographic regions: the "Pennyroyal," a rural area
where agriculture and mining are major factors in the economy, and the
"Bluegrass," a region featuring rich soil and rolling hills on which some of the
most prominent thoroughbred horse farms in the world are located. Prominent
corporations with facilities in this area include Fruit of the Loom, General
Motors Corvette Assembly Division, the Holley Division of Coltec Industries,
Eaton Corporation, Lord Corporation, Pan American Mills, Inc., Country Oven
Bakery Division of Kroger Stores, Inc. and Hills Pet Products. Bowling Green is
also the home of Western Kentucky University with approximately 16,000 students
and 2,500 employees.

Station History and Characteristics. WBKO-TV was originally licensed in
1962 to serve southcentral Kentucky. The Bowling Green market is ranked 182nd in
the United States, with approximately 70,000 television households and a
population of approximately 170,000. WBKO-TV is broadcast on VHF channel 13 and
is an ABC affiliate. The Company acquired WBKO-TV in 1983. The only other local
commercial station broadcasting in this market is a Fox affiliate which
broadcasts on a UHF channel. WBKO-TV also competes to some extent with three
stations broadcasting from Nashville, Tennessee.

-16-

WTOK-TV (ABC) MERIDIAN, MISSISSIPPI

Market Description. The Meridian DMA consists of seven counties, five of
which are in eastern Mississippi and two of which are in western Alabama.
Meridian is approximately 150 miles west of Montgomery, Alabama and 90 miles
east of Jackson, Mississippi. The Meridian economy, traditionally based on the
cattle and timber industries, has recently evolved into a medical and financial
hub for eastern Mississippi and western Alabama. In addition, Meridian's
favorable industrial climate has lured over 100 manufacturing plants to the
area, including Peavey Electronics Corporation, James River Corp., Avery
Dennison Stationery Products Division and the Delco-Remy Division of General
Motors. There are also many large hospitals in the area, including Rush
Foundation Hospital, East Mississippi State Hospital, Riley Memorial Hospital
and Jeff Anderson Regional Medical Center, which together employ over 3,800
individuals. Meridian is also site of Meridian Naval Air Station, a United
States Naval training facility.

Station History and Characteristics. WTOK-TV was originally licensed in
1953 to serve Meridian, Mississippi. The Meridian market is ranked 183rd in the
United States, with approximately 66,000 television households and a population
of approximately 173,000. WTOK-TV is broadcast on VHF channel 11 and is an ABC
affiliate. The Company acquired WTOK-TV in 1988. The other two commercial
stations in the market, affiliates of NBC and CBS, are broadcast on UHF channels
with considerably smaller broadcast coverage than WTOK-TV. The CBS affiliate
recommenced broadcasting in April 1994 after ceasing operations in April 1992.
In August 1995, the CBS and NBC affiliates entered into a local marketing
agreement pursuant to which the CBS affiliate would manage the NBC affiliate.

WTAP-TV (NBC) PARKERSBURG, WEST VIRGINIA

Market Description. The Parkersburg DMA consists of three counties, two of
which are in western West Virginia and one of which is in eastern Ohio.
Parkersburg is located at the confluence of the Little Kanawha and the Ohio
Rivers, approximately 140 miles from Pittsburgh, Pennsylvania and approximately
75 miles from Charleston, West Virginia. The Parkersburg economy is evenly
distributed among the manufacturing and services sectors. A number of prominent
companies maintain facilities in the Parkersburg market, including E. I. du Pont
de Nemours & Co., General Electric Plastics, Shell Chemical, Ames Company,
Nashua Photo, Inc. and Schott Scientific Glass, Inc. The area is also home to
the Bureau of Public Debt, the printer for all United States Government Bonds,
as well as several regional educational institutions including West Virginia
University at Parkersburg, Ohio Valley College and Marietta College.

Station History and Characteristics. WTAP-TV was originally licensed in
1953 and is the only commercial television station licensed to serve the
Parkersburg market. The Parkersburg market is ranked 186th in the United States,
with approximately 61,500 television households and a population of
approximately 153,000. WTAP-TV is broadcast on UHF channel 15 and is an NBC
affiliate. The Company acquired WTAP-TV in 1979. Other network affiliated
stations, including one NBC affiliate, located in Charleston, West Virginia and
Columbus, Ohio, are carried on cable systems in Parkersburg, but are not part of
the Parkersburg DMA.

KGWN-TV (CBS) CHEYENNE, WYOMING
KSTF-TV (CBS) SCOTTSBLUFF, NEBRASKA
KTVS-TV (CBS) STERLING, COLORADO

Market Description. The Cheyenne-Scottsbluff-Sterling DMA consists of three
counties, two in southeastern Wyoming and one in western Nebraska. Cheyenne, the
state capital of Wyoming, is located approximately 100 miles north of Denver,
Colorado. The Cheyenne economy is supported primarily by government,
transportation, tourism, services and light manufacturing. Significant employers
in the area include Union Pacific Railroad, United Medical Center, Veteran's
Administration Hospital, Safecard and Frontier Oil Refinery. Cheyenne is also
home to the F. E. Warren United States Air Force Base, which employs more than
4,000 people in military and civilian capacities.

-17-

In order to properly serve the Cheyenne-Scottsbluff-Sterling DMA, KGWN-TV
operates two satellite television stations, KSTF-TV in Scottsbluff, Nebraska and
KTVS-TV in Sterling, Colorado. Scottsbluff is located in Scotts Bluff County,
Nebraska approximately 100 miles northeast of Cheyenne. Sterling is located in
Logan County, Colorado approximately 100 miles southeast of Cheyenne. The
satellite stations serve sparsely populated rural areas which lack the resources
to support full-service broadcast operations unrelated to the parent Station's
more populous communities.

Station History and Characteristics. KGWN-TV, originally licensed in 1954
to serve Cheyenne, Wyoming. Since first going on the air, KGWN-TV has been the
only home market station in the City of Cheyenne and Laramie County. The
Cheyenne-Scottsbluff-Sterling market is ranked 194th in the United States with
approximately 50,000 television households and a population of approximately
123,000. KGWN-TV is broadcast on VHF channel 5 and is a CBS affiliate. KSTF-TV,
broadcast on VHF channel 10, and KTVS-TV, broadcast on VHF channel 3, are
operated as S-2 satellites receiving a substantial portion of their programming
from KGWN-TV. However, as S-2 satellites, KSTF-TV and KTVS-TV broadcast some
self-produced local programming which is not provided by KGWN-TV. KGWN-TV
competes with two other commercial stations in the Cheyenne market, a satellite
station of an ABC affiliate in Casper, Wyoming which broadcasts Fox programming
in Cheyenne, and a satellite station of an NBC affiliate, both of which
satellite stations broadcast on UHF channels. KSTF-TV competes with one other
commercial station in the Scottsbluff market, a satellite station of an ABC
affiliate which broadcasts on a VHF channel. KTVS-TV competes to some extent
with several stations broadcasting from Denver, Colorado.

KGWC-TV (CBS) CASPER, WYOMING
KGWL-TV (CBS) LANDER, WYOMING
KGWR-TV (CBS) ROCK SPRINGS, WYOMING

Market Description. The Casper-Riverton DMA consists of six counties in
central Wyoming. Casper is located approximately 290 miles southeast of
Billings, Montana and 275 miles north of Denver, Colorado. The Casper economy,
historically centered on oil and agriculture, has recently diversified with the
growth of its service sector. Major employers in the area include the Wyoming
Medical Center, Wotco, Inc., Conoco, True Oil & Affiliates and Rissler McMurry.
Casper is also home to Casper College and the University of Wyoming-Casper, with
an aggregate student population of approximately 4,500.

In order to properly serve the vast geographic area covered by the
Casper-Riverton DMA, KGWC-TV operates two satellite television stations, KGWL-TV
in Lander, Wyoming and KGWR-TV in Rock Springs, Wyoming. Lander is located in
Freemont County approximately 140 miles southwest of Casper. Rock Springs is
located in Sweetwater County approximately 220 miles southwest of Casper. The
satellite stations serve sparsely populated rural areas which lack the resources
to support full-service broadcast operations unrelated to the parent Station's
more populous communities.

Station History and Characteristics. KGWC-TV, originally licensed in 1980
to serve Casper, Wyoming. The Casper-Riverton market is ranked 197th in the
United States, with approximately 50,000 television households and a population
of approximately 125,000. KGWC-TV is broadcast on UHF channel 14 and is a CBS
affiliate. KGWL-TV, broadcast on VHF channel 5, and KGWR-TV, broadcast on VHF
channel 13, are operated as S-1 satellite stations receiving all of their
programming from KGWC-TV. KGWC-TV competes with two other commercial stations in
this market, an NBC affiliate which broadcasts on a VHF channel and an ABC/Fox
affiliate which broadcasts on a UHF channel.

COMPETITION

The principal methods of competition in television broadcasting are the
development of audience interest through programming and promotions and
competition in rates charged to advertisers. Broadcast television stations
compete for advertising revenues with other broadcast stations, cable television
and all other

-18-

advertising media in their market areas and generally do not compete with
stations in other markets. The Company has generally acquired stations in
markets where there are only a limited number of over-the-air television
stations competing for local viewership and for local advertising revenues. In
two of its markets, the Company owns the only local television station. In four
markets, the Company owns one of only two local television stations. In seven
markets, the Company owns one of three local television stations. In eight
markets, the Company owns one of four local television stations. In addition,
WTVY-TV competes with two other stations in the Dothan market and with three
other stations in the Panama City market.

Audience. Stations compete for audience on the basis of program popularity
which has a direct effect on advertising rates. A significant portion of the
Company's daily programming is supplied by the networks. In those time periods,
the Stations are totally dependent upon the performance of the networks'
programs in attracting viewers. Non-network time periods are programmed by the
Stations with local news and syndicated programs generally purchased for cash
and barter and, to a lesser extent, barter-only. The Stations also air sports,
public affairs and other entertainment programming.

The development of methods of television transmission of video programming
other than over-the-air broadcasting, and in particular the growth of cable
television, has significantly altered competition for audience in the television
industry. These other transmission methods can increase competition for a
broadcasting station by bringing into its market distant broadcasting signals
not otherwise available to the station's audience and also by serving as a
distribution system for non-broadcast programming distributed by the cable
system. As the technology of satellite program delivery to cable systems
advanced in the late 1970's, development of programming for cable television
accelerated dramatically, resulting in the emergence of multiple, national-scale
program alternatives and the rapid expansion of cable television and higher
subscriber growth rates. Historically, cable operators have not sought to
compete with broadcast stations for a share of the local news audience.

The FCC has authorized several entities to construct and launch satellites
to deliver DBS to homes from satellites. Three DBS companies provide nationwide
service and MCI Communications has acquired the right to launch a fourth DBS
satellite service in a joint venture with the parent of Fox. In early 1997, the
Fox DBS venture and Echostar, an operating DBS company, announced a merger and a
plan to carry local broadcast stations. The FCC has also adopted rules which may
significantly increase the number of multipoint distribution service stations
("MDS") (i.e., video service distributed on microwave frequencies which can only
be received by special microwave antennae). These MDS stations have launched
service in several cities, and one telephone company has also begun offering
digital MDS service. In addition, the FCC has authorized a 28 GHz microwave
cable service that will have the potential to provide up to 100 channels of
video or more. The FCC is also licensing low power television stations which are
television stations with coverage areas much smaller than those served by full
power conventional television stations.

Current technology offers several different methods for transmitting
television signals with greatly improved definition, color rendition, sound and
wider screen picture. Collectively, these improvements are referred to as
digital television ("DTV"), with the most advanced type of transmission system
being high definition television. Intensive research and development efforts
have achieved forms of DTV that can be transmitted by existing terrestrial
broadcasters in the United States. A number of such proposed systems have been
extensively tested by an industry test center under the auspices of an Industry
Advisory Committee reporting to the FCC. Following such testing, the major
proponents of the competing systems agreed to combine their efforts to provide a
single DTV system, and these efforts resulted in technical standards that were
submitted to the FCC in 1995. In late 1996, the FCC adopted a technical standard
for DTV. The standard will involve the broadcast of DTV on a separate television
channel from that used for conventional

-19-

broadcasting and that channel may also be used by broadcasters for data
transmission and multi-channel transmission. The FCC currently is determining
whether and how to assign licenses to permit television broadcasters to provide
DTV services. The FCC has tentatively decided to issue a second channel to each
television broadcaster to permit it to provide DTV during a transition period.
Although in some cases a DTV channel may provide a station with a smaller
geographic service area than its current channel, most stations are expected to
obtain DTV service areas that are consistent with their current service areas.
At the end of the transition period, each broadcaster would be required to
return to the FCC one of these two channels. This transition ultimately will
permit broadcasters to provide higher quality services to their viewers and may
permit broadcasters to compete more effectively with other digital video
systems. However, constructing and operating a second television channel will
require a substantial capital outlay for all of the Stations. The Company is
unable to predict the effect that technological changes will have on the
broadcast television industry or the future results of the Company's operations.

In addition, certain leaders in Congress and the Administration have
proposed legislation requiring broadcasters to (i) bid at auction for DTV
channels, potentially against other non-broadcast applicants, (ii) return their
analog channels on an expedited basis by 2005 to permit the old channels to be
reauctioned to new licensees and/or (iii) pay a fee for the use of the second
channel, starting either immediately or after 2005. These proposals, if enacted,
could affect the Company. First, auctions for DTV channels could substantially
increase the Company's up-front costs of converting to DTV and would raise the
possibility that the Company could be subject to additional competition in its
markets if it, or another licensee, is out-bid by a newcomer. Second, an
expedited transition period could require the Company to end analog transmission
before all its viewers (particularly those in the smaller markets which the
Company serves) have purchased DTV-compatible reception equipment.

Programming. Competition for programming involves negotiating with national
program distributors or syndicators which sell first run and rerun packages of
programming. The Stations compete against local broadcast stations for exclusive
access to first run product (such as "The Oprah Winfrey Show," "Wheel of
Fortune" and "Jeopardy") and for off-network reruns (such as "Home Improvement,"
"Seinfeld" and "Roseanne") in their respective markets. Cable systems generally
do not compete with local stations for programming, although various national
cable networks have acquired programs that would have otherwise been offered to
local television stations. Competition also occurs for exclusive news stories
and features.

Advertising. The Stations compete for advertising revenues with other
television stations in their respective markets, as well as with other
advertising media, such as newspapers, radio, magazines, outdoor advertising,
transit advertising, yellow page directories, direct mail and local cable
systems. Competition for advertising expenditures in the broadcasting industry
occurs primarily in individual markets. Generally, television broadcasting
stations in one market do not compete with stations in other market areas.

Management cannot predict the exact nature of the competition it will face
in any market since competing stations may change owners, affiliations and/or
programming focus at any time. The Company cannot predict the effect the changes
in legislation or technology, discussed herein, will have on its operations. In
certain markets, construction permits for new stations have been or may be
granted.

FEDERAL REGULATION OF TELEVISION BROADCASTING

Existing Regulation. Television broadcasting is subject to the jurisdiction
of the FCC, pursuant to the Communications Act of 1934, as amended (the
"Communications Act"). The Communications Act prohibits the operation of
television broadcasting stations except under a license issued by the FCC and
empowers the

-20-

FCC to issue, renew, revoke and modify broadcasting licenses, regulate the
frequency and operating power of stations, determine station location, regulate
the equipment used by stations, adopt rules and regulations to carry out the
provisions of the Communications Act and to impose certain penalties for
violations of the Communications Act. The Communications Act prohibits the
assignment of a license or the transfer of control of a licensee without prior
approval of the FCC.

License Grant and Renewal. Television broadcasting licenses are usually
granted or renewed for the maximum allowable term of eight years. The FCC may
revoke a license or renew a license for a period shorter than the maximum
allowable term if the FCC finds that the licensee has committed a serious
violation of FCC rules, has committed other violations which taken together
would constitute a pattern of abuse, or has otherwise failed to serve the public
interest. At the time the application is made for renewal of a television
license, parties in interest may file petitions to deny renewal, and such
parties as well as members of the public may comment upon the service the
station has provided during the preceding term and urge denial of the
application. Additionally, if an incumbent licensee fails to meet the renewal
standard, and if it does not show other mitigating factors warranting a lesser
sanction, the FCC then has the authority to deny the renewal application and
consider a competing application.

In the vast majority of cases, broadcast licenses are renewed by the FCC
even when the petitions to deny are filed against broadcast license renewal
applications. All of the Stations are presently operating under five-year
licenses expiring on various dates from 1997 to 2005. Currently, WTOK-TV,
Meridian, Mississippi, and WTVY-TV, Dothan, Alabama, have pending applications
for license renewal. The Company is not aware of any facts or circumstances that
might prevent any of the Stations from having its current license renewed at the
end of its respective term or which might prevent the license renewal for
WTOK-TV or WTVY-TV from being granted.

The Communications Act prohibits the assignment of a license or the
transfer of control of a license without prior approval of the FCC. Under the
Communications Act, no license may be held by a corporation of which more than
20% of the capital stock is owned of record, voted or subject to control by
aliens, and no corporation may hold the capital stock of another corporation
holding broadcast licenses if more than 25% of the capital stock of such parent
corporation is owned of record, voted or subject to control by aliens, unless
specific FCC authorization is obtained.

Multiple Ownership Restrictions. The FCC has promulgated a number of rules
designed to limit the ability of individuals and entities to own or have an
ownership interest above a certain level (an "attributable interest," defined
more fully below) in broadcast stations, as well as other mass media entities.
These rules include limits on the number of television stations that may be
owned both on a national and a local basis. On a national basis, FCC rules
generally limit any individual or entity from having attributable interests in
television stations with an aggregate audience reach exceeding 35% of all United
States households.

The FCC also limits the common ownership of broadcast stations with
overlapping service areas, combined local ownership of a newspaper and a
broadcast station and combined local ownership of a cable television system and
a broadcast television station. FCC rules currently allow an entity to have an
attributable interest in only one television station in a market. In approving
the Brissette acquisition, the FCC granted six-month waivers of that rule as it
pertains to the transmission signal overlap of (i) WIFR-TV, the Benedek Station
serving Rockford, Illinois, and WMTV-TV, the Brissette Station serving Madison,
Wisconsin; (ii) WYTV, the Benedek Station serving Youngstown, Ohio, and WTRF-TV,
the Brissette Station serving Wheeling, West Virginia and Steubenville, Ohio;
and (iii) WTAP-TV, the Benedek Station serving Parkersburg, West Virginia, and
WTRF-TV. These waivers will permit the Company to hold the

-21-

Stations in question for a six-month period after closing before divesting one
of the two Stations that do not comply with the duopoly rule in each instance.
The FCC has a pending proceeding that may result in the liberalization of the
duopoly rule to permit the Company to continue to own all the Stations it
currently owns as well as all of those it has received FCC consent to acquire.
The Company has requested an extension of its waiver to permit it to continue to
own these Stations pending the Commission's decision on this proceeding. The FCC
proposed revised duopoly rules during the fourth quarter of 1996 and it is
expected that, after considering public comments, new rules will become
effective during 1997 or early 1998. As a result of the limited waiver provided
by the FCC, the Company has had discussions concerning exchanging or selling
Stations which would eliminate the duopoly overlap. No agreement or
understanding currently exists with respect to any such sale or exchange. There
can be no assurance that the FCC will act to liberalize the rule or that it will
do so in time to avoid the Company's being required to divest certain Stations
in order to eliminate any signal overlap. Expansion of the Company's broadcast
operations in particular areas and nationwide will continue to be subject to the
FCC's ownership rules and any changes the FCC may adopt.

Under the FCC's ownership rules, if a purchaser of the Company's common
stock acquires an "attributable" interest in the Company, a violation of FCC
regulations could result if that purchaser owned or acquired an attributable
interest in other media properties in a manner prohibited by the FCC's rules.
All officers and directors of a licensee, as well as stockholders who own 5% or
more of the outstanding voting stock of a licensee (either directly or
indirectly), will generally be deemed to have an attributable interest. For
certain institutional investors who exert no control or influence over a
licensee, the bench-mark is 10% or more of such outstanding voting stock before
attribution occurs. Under FCC regulations, debt instruments, non-voting stock
and certain limited partnership interests and voting stock held by non-majority
stockholders in cases in which there is a single majority stockholder are not
generally subject to attribution. The Company currently has a single
stockholder. In the event the Company no longer had a single majority
stockholder, minority interests would be deemed to be attributable interests.
The FCC has initiated an inquiry into modifying several of these attribution
standards. It is likely that this inquiry will be concluded in late 1997 or
early 1998, and there can be no assurance that these rules will be changed.

To the best of the Company's knowledge, no officer, director or stockholder
of the Company holds an interest in another radio or television station, cable
television system or daily newspaper that is inconsistent with the FCC's
ownership rules and policies.

Regulation of Broadcast Operations. Television broadcasters are subject to
FCC regulation in several other areas, including political broadcasting,
children's programming, obscene and indecent programming and equal employment
opportunities.

Candidates for Federal elective office have a right to buy advertising time
on television stations. Stations may also choose, but are not required, to carry
advertising by state or local candidates. When a station carries advertising by
one candidate (whether Federal, state or local), the station must afford "equal
opportunity" for advertising by that candidate's opponent(s). During the last 45
days of a primary campaign and the last 60 days of a general election campaign,
stations may not charge political candidates rates any higher than the rate
being charged to the most favored commercial advertiser during the same period.
These requirements can have the effect of reducing the revenues that a station
might otherwise earn during preelection periods.

Television stations must serve the educational and information needs of
children in their overall programming, and must air some programming
specifically designed to serve those needs. The programming

-22-

obligation applies to programs originally produced and broadcast for an audience
of children 16 years of age and younger. Commercial time is limited to 10.5
minutes per hour on weekends and 12 minutes per hour on weekdays for programs
originally produced and broadcast primarily for an audience of children 12 years
of age and younger.

Television stations may not air obscene programming at any time, and may
not air indecent programming during the morning, afternoon and early evening.
Material is obscene if it appeals to viewers' prurient interests by depicting
sexual conduct in a patently offensive manner and lacks serious literary,
artistic, political or scientific value. Material is indecent if it describes in
patently offensive terms, sexual or excretory activities or organs.

Television stations must have an equal employment opportunity ("EEO")
policy that prohibits discrimination based on race, color, sex, religion or
national origin, and must establish EEO programs that encourage recruitment and
hiring of women and minorities. The FCC requires licensees to file regular
employment reports with the agency, recruit minority or female applicants for
vacancies, maintain records documenting the recruitment of women and minorities,
work with local organizations to identify female and minority job candidates,
and examine their sources of job referrals to determine if those sources are
effective in providing a station with female or minority applicants. The FCC
recently issued a notice of proposed rulemaking regarding its EEO rules, stating
that it hoped to make its EEO rules less burdensome (especially for small
stations).

In all of the foregoing areas, as well as in other matters that affect
operations and competition in the television broadcast industry, regulatory
policies are subject to change over time and cannot be fully predicted.

Proposed Legislation and Regulation. The Congress and the FCC currently
have under consideration, and may in the future adopt, new rules, regulations
and policies regarding a wide variety of matters which could, directly or
indirectly, affect the operation and ownership of the Stations. In addition to
the proposed changes set forth above, examples of such matters include policies
concerning eliminating certain cross-ownership restrictions, political
advertising and programming practices, flexible use of broadcast spectrum,
spectrum use fees, the standards to govern evaluation of television programming
directed toward children and violent and indecent programming. Other matters
that could affect the Company's broadcast properties include technological
innovations and developments generally affecting competition in the mass
communications industry, such as the initiation of DBS, the continued
establishment of wireless cable systems and low power television stations and
the participation of telephone companies in the provision of video programming
by wire.

Implementation of the Cable Act of 1992. The Cable Television Consumer
Protection and Competition Act of 1992 (the "Cable Act") was enacted on October
5, 1992. The Cable Act imposes cable rate regulation, establishes cable
ownership limitations, regulates the relationships between cable operators and
their program suppliers, regulates signal carriage and retransmission consent
and regulates numerous other aspects of the cable television business.

The signal carriage, or "must carry," provisions of the Cable Act require
cable operators to carry the signals of local commercial and non-commercial
television stations and certain low power television stations. Systems with 12
or fewer usable activated channels and more than 300 subscribers must carry the
signals of at least three local commercial television stations. A cable system
with more than 12 usable activated channels, regardless of the number of
subscribers, must carry the signals of all local commercial television

-23-

stations, up to one-third of the aggregate number of usable activated channels
of such system. The Cable Act also includes a retransmission consent provision
that requires cable operators and other multi-channel video programming
distributors to obtain the consent of broadcast stations prior to carrying them
in certain circumstances. The must carry and retransmission consent provisions
are related in that a television station must elect once every three years
either to waive its right to mandatory, but uncompensated, carriage or to
negotiate a grant of retransmission consent to permit the cable system to carry
the station's signal.

In April 1993, a three-judge panel of the United States District Court of
the District of Columbia upheld the constitutionality of the legislative
must-carry provisions. In June 1994, the Supreme Court ruled that the must-carry
provisions were "consent-neutral" and, thus, not subject to strict scrutiny and
that Congress's stated interests in preserving the benefits of free, off-air
broadcast television, promoting the widespread dissemination of information from
a multiplicity of sources and promoting fair competition in the market for
television programming all qualify as important governmental interests. The
Court, however, remanded to the lower federal court with instructions to hold
further proceedings with respect to evidence that lack of the must-carry
requirements would harm free, off-air broadcasting. In 1995, the lower court
again upheld the constitutionality of must-carry requirements after reviewing
the required evidence. The Supreme Court recently agreed to review the case
again in the fall of 1996, and a decision on that case is expected by mid-1997.

Under rules adopted to implement these must carry and retransmission
consent provisions, local broadcast stations were required to make their initial
elections of must carry or retransmission consent by June 17, 1993, effective
October 6, 1993. Stations that failed to elect were deemed to have elected
carriage under the must carry provisions. Other issues addressed in the FCC
rules were market designations, the scope of retransmission consent and
procedural requirements for implementing the signal carriage provisions.

In 1993, the Company elected and negotiated retransmission consents with
all of the local cable systems which carry the signals of the Benedek Stations.
The Company has entered into agreements for each Benedek Station with all of
these cable system operators. All of these agreements grant such cable system
operators to retransmit the Benedek Station's signal. These retransmission
arrangements do not represent a significant source of revenue for the Company.
The terms of these retransmission agreements range from one to five years. In
1993, each of Stauffer and Brissette also elected and negotiated retransmission
consents with all of the local cable systems carrying the signals of their
respective Stations and each entered into agreements for its Stations similar to
the retransmission consent agreements entered into by the Company. The Company
recently elected retransmission consent with those cable systems with which the
prior agreements expired. The Stations are currently negotiating with these
operators to enter into longer term agreements. The Company cannot predict the
outcome of these negotiations. In addition, although the Company expects to be
able to renew its current retransmission agreements when such agreements expire,
there can be no assurance that such renewals will be obtained.

EMPLOYEES

The Company currently employs approximately 1,300 full-time employees.
Approximately 250 of the Company's employees located at WMTV-TV, WILX-TV,
WHOI-TV, WTRF-TV, KDLH-TV and WYTV are represented by labor unions under
collective bargaining agreements. The collective bargaining agreements expire at
various times from 1997 through 2000. There are no unionized employees at the
remaining Stations. The Company believes that its relationship with all of its
employees, including those represented by labor unions, is satisfactory.

-24-

ITEM 2. PROPERTIES.

The Company's principal executive offices are located in leased premises in
Rockford, Illinois.

The types of properties required to support each of the Stations include
offices, studios and tower and transmitter sites. A station's studio and office
are generally located in business districts while tower and transmitter sites
are generally located so as to provide maximum signal coverage to each market.
The following table contains certain information describing the general
character of the properties of the Company.

<TABLE>
<CAPTION>
STATION, MARKET AREA AND USE OWNED OR LEASED APPROXIMATE SIZE(A) HEIGHT/POWER EXPIRATION OF LEASE
- --------------------------------- -------------------- ----------------------- ----------------------- ----------------------
<S> <C> <C> <C> <C>
WMTV-TV; Madison, WI

Office and Studio................ Owned 16,485 sq. ft. -- --
Tower/Transmitter Site........... Owned (b) 1,040 ft./955 kw --
WYTV; Youngstown, OH

Office and Studio................ Owned 18,964 sq. ft. -- --
Tower/Transmitter Site........... Owned (b) 642 ft./550 kw --
WWLP; Springfield and
Holyoke, MA

Office and Studio................ Owned 20,000 sq. ft. -- --
Tower/Transmitter Site........... Owned (b) 500 ft./342 kw --
WILX-TV; Lansing, MI

Office and Studio................ Owned 13,700 sq. ft. -- --
Tower/Transmitter Site........... Owned 5,000 sq. ft. 994 ft./309 kw --
WHOI-TV; Peoria and
Bloomington, IL

Office and Studio................ Owned 16,900 sq. ft. -- --
Tower/Transmitter Site........... Owned (b) 640 ft./2,240 kw --
KCOY-TV; Santa Barbara,
Santa Maria and San Luis
Obispo, CA

Office and Studio................ Owned 18,000 sq. ft. -- --
Tower/Transmitter Site........... Leased 1,200 sq. ft. 140 ft./115 kw (c)
KDLH-TV; Duluth, MN
and Superior, WI

Office and Studio................ Owned 25,000 sq. ft. (d) -- --
Tower/Transmitter Site........... Owned 1,040 sq. ft. 811 ft./100 kw --
WIFR-TV; Rockford, IL

Office and Studio................ Owned 13,500 sq. ft. -- --
Tower/Transmitter Site........... Owned (b) 674 ft./562 kw --
WSAW-TV; Wausau and
Rhinelander, WI

Office and Studio................ Owned 24,400 sq. ft. -- --
Tower/Transmitter Site........... Leased (e) 432 sq. ft. 650 ft./316 kw 08/01/02
WTRF-TV; Wheeling, WV
and Steubenville, OH

Office and Studio................ Owned 43,872 sq. ft. (f) -- --
Tower/Transmitter Site........... Owned 2,000 sq. ft. 741 ft./316 kw --

-25-
</TABLE>

Office and Studio................ Leased 18,774 sq. ft. (g) -- 08/31/98
Tower/Transmitter Site........... Leased 2,338 sq. ft. 1,249 ft./316 kw 02/14/62
KAUZ-TV; Wichita Falls,
TX and Lawton, OK

Office and Studio................ Owned 13,078 sq. ft. -- --
Tower/Transmitter Site........... Owned (b) 1,028 ft./100 kw --
KMIZ-TV; Columbia and
Jefferson City, MO

Office and Studio................ Owned 5,993 sq. ft. -- --
Tower/Transmitter Site........... Owned 875 sq. ft. 1,030 ft./1,580 kw --
KOSA-TV; Odessa and
Midland, TX

Office and Studio................ Owned 14,222 sq. ft. -- --
Tower/Transmitter Site........... Leased 930 sq. ft. 726 ft./316 kw 10/31/98
KHQA-TV; Quincy, IL
and Hannibal, MO

Office and Studio................ Leased 13,120 sq. ft. -- (h)(i)
Tower/Transmitter Site........... Owned 1,200 sq. ft. 804 ft./269 kw --
WTVY-TV; Dothan, AL
and Panama City, FL

Office and Studio................ Leased 20,440 sq. ft. -- 12/31/02
Tower/Transmitter Site........... Owned 2,500 sq. ft. 1,880 ft./100 kw --
WHSV-TV; Harrisonburg, VA

Office and Studio................ Owned 6,720 sq. ft. -- --
Tower/Transmitter Site........... Leased 2,016 sq. ft. 337 ft./8.32 kw 12/31/01(j)
WBKO-TV; Bowling
Green, KY

Office and Studio................ Owned 17,598 sq. ft. -- --
Tower/Transmitter Site........... Owned 1,175 sq. ft. 603 ft./316 kw --
WTOK-TV; Meridian, MS

Office and Studio................ Owned 13,188 sq. ft. -- --
Tower/Transmitter Site........... Owned 1,504 sq. ft. 316 ft./316 kw --
WTAP-TV; Parkersburg, WV

Office and Studio................ Leased 17,500 sq. ft. -- 04/30/05(k)
Tower/Transmitter Site........... Owned 3,600 sq. ft. 439 ft./208 kw --
KGWN-TV; Cheyenne, WY

Office and Studio................ Owned 7,500 sq. ft. -- --
Tower/Transmitter Site........... (l) 2,646 sq. ft. 620 ft./100 kw --
KSTF-TV (satellite)
Scottsbluff, NE

Office and Studio................ Owned 2,400 sq. ft. -- --
Tower/Transmitter Site........... Owned 2,457 sq. ft. 674 ft./240 kw --

-26-

</TABLE>

STATION, MARKET AREA AND USE OWNED OR LEASED APPROXIMATE SIZE(A) HEIGHT/POWER EXPIRATION OF LEASE
- --------------------------------- -------------------- ----------------------- ----------------------- ----------------------
<S> <C> <C> <C> <C>
KTVS-TV (satellite)
Sterling, CO
Office and Studio................ Owned 3,750 sq. ft. -- --
Tower/Transmitter Site........... Owned 2,640 sq. ft. 730 ft./60.6 kw --

KGWC-TV; Casper and
Riverton WY
Office and Studio................ Leased 6,827 sq. ft. -- 08/31/97
Tower/Transmitter Site........... Owned 1,692 sq. ft. 235 ft./60 kw --

KGWL-TV (satellite)
Lander, WY
Tower/Transmitter Site........... Leased 768 sq. ft. 155 ft./30 kw 12/31/07

KGWR-TV (satellite)
Rock Springs, WY
Tower/Transmitter Site........... Leased 400 sq. ft. 100 ft./12 kw 05/22/99
- ------------------
</TABLE>

(a) Approximate size is for building space only and does not include the land
on which the facilities are located.

(b) Tower/Transmitter Site is located at and included within the size of the
office and studio premises.

(c) Occupied on a month-to-month basis pursuant to approval of the United
States Department of Agriculture Forest Service. This property was
previously occupied pursuant to a Special Use Permit. Currently the United
States Department of Agriculture Forest Service is revising certain
provisions of its form of Special Use Permit which would otherwise have
been reissued to Stauffer in the ordinary course of business. The Company
has applied for and anticipates that it will be issued a Special Use Permit
with respect to this property upon completion of the aforementioned
revisions. However, there can be no assurance that such a Special Use
Permit will be issued in the future.

(d) The Company owns a building of approximately 55,000 sq. ft. in which the
offices and studio of KDLH-TV are located and of which approximately 30,000
sq. ft. are leased to third parties.

(e) Leased together with TAK Communications from the Wisconsin Educational
Board.

(f) The Company owns a building of approximately 46,872 sq. ft. in which the
offices and studio of WTRF-TV are located and of which approximately 3,000
sq. ft. are leased to a third party.

(g) The Company leases a building of approximately 23,837 sq. ft. in which the
offices and studio of WIBW-TV are located and of which approximately 5,063
sq. ft. are subleased to Stauffer, which owns and operates radio stations
WIBW AM and FM.

(h) Occupied on a month-to-month basis.

(i) The Company purchased land to relocate studio and office in early 1998.

(j) Occupied pursuant to a Special Use Permit granted by the United States
Department of Agriculture Forest Service (k) The Company has an option to
purchase the premises on each of May 1, 2000 and 2005 for $650,000 and
$750,000, respectively.

(l) This property is utilized subject to an easement granted by the State of
Wyoming.

-27-

ITEM 3. LEGAL PROCEEDINGS.

The Company currently and from time to time is involved in litigation
incidental to the conduct of its business. The Company (including in its
capacity as successor of Brissette) is not currently a party to any lawsuit
or proceeding which, in the opinion of management, is likely to have a
material adverse effect on the Company.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

Not applicable.

-28-

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Not applicable.

ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA.

The following selected consolidated financial data for the five years ended
December 31, 1996 represents the consolidated financial information of the
Company and are derived from the audited Consolidated Financial Statements,
which Consolidated Financial Statements for the three years ended December 31,
1996 together with the report of McGladrey & Pullen, LLP, independent certified
public accountants, are included elsewhere in this Annual Report on Form 10-K.
The selected consolidated financial information presented below should be read
in conjunction with the Consolidated Financial Statements included elsewhere in
this Annual Report on Form 10-K and "Management's Discussion and Analysis of
Financial Condition and Results of Operations."

YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------
1992 1993 1994 1995(A) 1996(B)
---- ---- ---- ------- -------
<S> <C> <C> <C> <C> <C>
(DOLLARS IN THOUSANDS)
STATEMENT OF OPERATIONS DATA:

Net revenues(c)................................... $ 36,311 $ 38,352 $ 44,221 $ 50,329 $ 96,386
Operating expenses:
Station operating expenses................... 21,511 22,805 24,810 29,049 58,602
Depreciation and amortization................ 4,428 3,721 3,403 5,041 20,220
------------ ------------- ------------- ------------- ------------
Station operating income.......................... 10,372 11,826 16,008 16,239 17,564
Corporate.................................... 1,288 1,249 1,309 1,576 2,695
Special bonus, officer-stockholder........... - 1,400 - - -
------------ ------------- ------------- ------------ ------------
Operating income................................... 9,084 9,177 14,699 14,663 14,869
------------ ------------- ------------- ------------ ------------
Financial expenses, net:
Interest expense, net(d):

Cash interest, net........................... (6,605) (8,194) 7,740) (14,763) (22,559)
Other interest............................... (7,774) (6,161) (4,905) (712) (8,130)
------------ ------------- ------------ ------------- ------------
(14,379) (14,355) (12,645) (15,475) (30,689)
Other, net........................................ (310) 144 (10) - -
------------ ------------- ------------ ------------- ------------
(14,689) (14,211) (12,655) (15,475) (30,689)
------------ ------------- ------------ ------------- ------------
Income (loss) before income tax benefit and

extraordinary item.............................. (5,605) (5,034) 2,044 (812) (15,820)
Income tax benefit (e)............................ - - - - 4,664
------------ ------------- ------------- ------------ ------------
Income (loss) before extraordinary item........... (5,605) (5,034) 2,044 (812) (11,156)
Extraordinary item (f)............................ - - - 6,864 -
------------ ------------- ------------- ------------- ------------
Net income (loss)................................. (5,605) (5,034) 2,044 6,052 (11,156)
Preferred stock dividends and accretion........... - - - - (9,519)
------------ ------------- ------------- ------------- ------------
Net income (loss) applicable to common stock...... $ (5,605) $ (5,034) $ 2,044 $ 6,052 $ 20,675
------------ ------------- ------------- ------------- ------------
------------ ------------- ------------- ------------- ------------
Earnings (loss) per common share (k):
Income (loss) before extraordinary item......... $ (0.80) $ (0.72) $ 0.29 $ (0.12) $ (2.94)
Extraordinary item.............................. - - - 0.98 -
------------ ------------- ------------- ------------- ------------
Earnings (loss) per common share................ $ (0.80) $ (0.72) $ 0.29 $ 0.86 $ (2.94)
------------ ------------- ------------- ------------- ------------
------------ ------------- ------------- ------------- ------------

Weighted-average common shares outstanding........ 7,030,000 7,030,000 7,030,000 7,030,000 7,030,000
------------ ------------- ------------- ------------- ------------
------------ ------------- ------------- ------------- ------------

STATEMENT OF CASH FLOW DATA:
Net cash provided by (used in) operating

activities...................................... $ 5,255 $ 4,926 $ 10,493 $ 3,251 $ 17,843
Net cash (used in) investing activities........... (375) (864) (2,507) (30,972) (326,632)
Net cash provided by (used in) financing
activities...................................... (1,427) (6,951) (7,037) 32,773 307,212

-29-
</TABLE>

YEAR ENDED DECEMBER 31,
-------------------------------------------------------------------------------------
1992 1993 1994 1995(A) 1996(B)
---- ---- ---- ------- -------
<S> <C> <C> <C> <C> <C>
(DOLLARS IN THOUSANDS)
CERTAIN FINANCIAL DATA:

Broadcast cash flow (g).................... $ 14,728 $ 15,546 $ 19,627 $ 21,310 $ 38,865
Broadcast cash flow margin (h)............. 40.6% 40.5% 44.4% 42.3% 40.3%
Adjusted EBITDA (i)........................ 13,440 14,297 18,318 19,734 36,170
Adjusted EBITDA margin (j)................. 37.0% 37.3% 41.4% 39.2% 37.5%
Amortization of program broadcast rights... $ 1,996 $ 2,179 $ 2,104 $ 2,162 $ 4,399
Payment for program broadcast rights....... 2,068 2,180 1,888 2,132 3,318
Capital expenditures....................... 14,581 1,278 1,161 2,008 5,003

BALANCE SHEET DATA (END OF PERIOD):

Total assets.............................. $ 77,049 $ 72,818 $ 73,621 $114,453 $495,016
Working capital (deficit)................. (71) 3,684 1,611 13,665 3,698
Long-term debt (i)........................ 109,439 112,874 107,607 135,767 358,234
Redeemable preferred stock................ - - - - 105,519
Stockholder's (deficit)................... (41,004) (44,660) (42,615) (36,563) (51,561)

- ---------------------------
</TABLE>

(a) On March 31, 1995, the Company acquired WTVY-TV serving Dothan, Alabama and
Panama City, Florida. The statement of operations and other data does not
include information with respect to WTVY-TV prior to the date of
acquisition.

(b) On June 6, 1996, the Company acquired the Stauffer Stations and the
Brissette Stations. The statement of operations and other data does not
include information with respect to the Acquired Stations prior to the date
of acquisition.

(d) Cash interest expense, net includes cash interest paid and normal
adjustments to accrued interest. Other interest expense includes accrued
interest with respect to warrants to purchase the Company's common stock,
accrued interest with respect to the contingent equity value of the Company
and long-term deferred interest, accrued interest added to long-term debt
balances, deferred loan amortization and accretion of discounts.

(e) The Company has historically elected to be taxed as an S Corporation for
federal and state income tax purposes. Accordingly, the sole stockholder of
the Company is responsible for the payment of income taxes on the Company's
taxable income. Net income (loss) does not include a pro forma adjustment
for income taxes due to the availability of net operating loss
carryforwards and a valuation allowance. The Company's election to be taxed
as an S Corporation terminated automatically concurrently with the
consummation of the acquisitions of the Acquired Stations. The Company is
now subject to federal and state income taxes.

(f) The Company recorded an extraordinary gain from the early extinguishment of
debt comprised of a gain of $11.1 million reduced by losses of $2.7 million
of prepayment premiums and contingent payments and $1.5 million of
unamortized debt discount and deferred loan costs.

(g) Broadcast cash flow is defined as operating income before financial income
as derived from the consolidated statements of operations plus depreciation
and amortization, amortization of program broadcast rights, corporate
expenses and non-cash compensation less payments for program broadcast
rights. The Company has included broadcast cash flow data because such data
is used by certain investors to measure a company's ability to service
debt. Broadcast cash flow does not purport to represent cash provided by
operating activities as reflected in the Company's Consolidated Financial
Statements, is not a measure of financial performance under generally
accepted accounting principles and should not be considered in isolation or
as a substitute for measures of performance prepared in accordance with
generally accepted accounting principles.

(h) Broadcast cash flow margin is defined as broadcast cash flow divided by net
revenues.

(i) Adjusted EBITDA is defined as operating income before financial income as
derived from the consolidated statements of operations plus depreciation
and amortization, amortization of program broadcast rights and non-cash
compensation less payments for program broadcast rights. The Company has
included Adjusted EBITDA data because such data is used by certain
investors to measure a company's ability to service debt. Adjusted EBITDA
does not purport to represent cash provided by operating activities as
reflected in the Company's Consolidated Financial Statements, is not a
measure of financial performance under generally accepted accounting
principles and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with generally accepted
accounting principles.

(j) Adjusted EBITDA margin is defined as Adjusted EBITDA divided by net
revenues.

(k) Earnings (loss) per common share is computed by dividing income (loss)
after the deduction of preferred dividends and accretion of the redemption
prepayment premium and amortization of the initial warrants, by the
weighted average number of common shares outstanding. The effect of the
stock options, initial warrants and contingent warrants has not been
reflected in the computation since their inclusion as common stock
equivalents for both primary and fully-diluted earnings (loss) per share
was anti-dilutive.

(l) Long-term debt is defined as notes payable and capital leases payable
(including the current portion thereof), net of discount.

-30-

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

OVERVIEW

The operating revenues of the Company are derived primarily from the sale
of advertising time and, to a lesser extent, from compensation paid by the
networks for broadcasting network programming and barter transactions for goods
and services. Revenue depends on the ability of the Company to provide popular
programming which attracts audiences in the demographic groups targeted by
advertisers, thereby allowing the Company to sell advertising time at
satisfactory rates. Revenue also depends significantly on factors such as the
national and local economy and the level of local competition.

In 1996, the Company reported net revenues of $96.4 million compared to net
revenues of $50.3 million in 1995 and $44.2 million in 1994. The increase in
1996 net revenues was due largely to the acquisitions of the Acquired Stations
which represented $43.9 million. The Company had a net loss of $10.6 million for
1996 compared to a net income of $6.0 million (after an extraordinary gain of
$6.9 million) in 1995 and net income of $2.0 million for 1994. Adjusted EBITDA
for the year ended December 31, 1996 was $36.2 million as compared to $19.7
million for the year ended December 31, 1995 and $18.3 million for the year
ended December 31, 1994.

Local/regional advertising and national advertising constitute the largest
categories of the Company's operating revenues and represent approximately 79%
of gross revenues in 1996 as compared to 86% in 1995. Although relatively
constant as a total percentage of gross revenues, the mix of advertising revenue
can vary depending on the level of political advertising revenue. Excluding
political advertising revenue, the percentage of gross revenues attributable to
local/regional advertising and national advertising of the Company in 1994, 1995
and 1996 was 88.8%, 87.4% and 86.6%, respectively. The decrease in 1996 was the
result of an increase in network compensation of $4.0 million or 126.9%,
primarily as a result of the Acquisitions, and represents 7.0% of gross revenues
(excluding political advertising revenues) for 1996 as compared to 5.6% of gross
revenues (excluding political advertising revenues) in 1995.

Approximately 59% of the gross revenues of the Company in 1996 was
generated from local and regional advertising, which is sold primarily by the
Stations' sales staff, and the remainder of the advertising revenues is
comprised primarily of national advertising, which is sold by national sales
representatives retained by the Company. The Company generally pays commissions
to advertising agencies on local, regional and national advertising and to
national sales representatives on national advertising. Net revenues reflect
deductions from gross revenues for commissions payable to advertising agencies
and national sales representatives.

In December 1995, the Company entered into new long-term affiliation
agreements with CBS effective retroactive to July 1, 1995. In connection with
such arrangements, CBS paid the Company bonus payments of $2.5 million in the
fourth quarter of 1995 and $2.5 million in the first quarter of 1996. These
payments are being recognized as revenue by the Company at the rate of $0.5
million per year over the ten-year term of the affiliation agreements. In
connection with these payments, the Company also agreed with CBS that, upon the
consummation of the acquisition of the Acquired Stations, the terms of the
affiliation agreements for the Acquired Stations which are CBS affiliates would
be extended through 2005.

The Company's primary operating expenses are employee compensation,
programming and depreciation and amortization. Changes in compensation expense
result primarily from adjustments to fixed salaries based on employee
performance and inflation and, to a lesser extent, from changes in sales
commissions paid based on levels of advertising revenues. Programming expense
consists primarily of amortization of program rights. The Company purchases
first run and off-network syndicated programming on an ongoing basis and has a

-31-

policy of closely matching payments for and amortization of program rights in
each period. A network- affiliated station receives approximately two-thirds of
its required daily programming from the network at no cost. Depreciation and
amortization expense has generally declined from period to period as assets
acquired at the time of the acquisition of a station have been depreciated.
However, for 1996, depreciation and amortization increased $15.1 million due to
the acquisition of the Acquired Stations. Barter expense generally offsets
barter revenue and reflects the fair market value of goods and services
received. The Company's operating expenses (excluding depreciation and
amortization) represent approximately 63.5% of net revenues for 1996 as compared
to approximately 60.9% of net revenues for each of 1995 and 1994.

On March 31, 1995, the Company acquired, for a cash purchase price of
$28.7, million substantially all of the assets (including cash and accounts
receivable) of WTVY-TV (the "Dothan Station") which is the CBS affiliate serving
both Dothan, Alabama and Panama City, Florida.

On June 6, 1996, the Company acquired substantially all of the broadcast
television assets (including working capital of approximately $1.6 million) of
the Stauffer Stations consisting of five principal broadcast television stations
and four satellite broadcast television stations for a purchase price of $54.5
million. The principal stations acquired by the Company were KCOY-TV, Santa
Maria, California; WIBW-TV, Topeka, Kansas; KMIZ-TV, Columbia, Missouri;
KGWC-TV, Casper, Wyoming; and KGWN-TV, Cheyenne, Wyoming. KGWC-TV operates two
satellite stations, KGWL-TV, Lander, Wyoming, and KGWR-TV, Rock Springs,
Wyoming, both of which rebroadcast the programming of KGWC-TV. KGWN-TV operates
two satellite stations, KSTF-TV, Scottsbluff, Nebraska, and KTVS-TV, Sterling,
Colorado, both of which rebroadcast the programming of KGWN-TV. All of the
Stauffer Stations are affiliated with CBS, except for KMIZ-TV, Columbia,
Missouri, which is affiliated with ABC.

On June 6, 1996, the Company acquired all of the capital stock of Brissette
for $270.0 million in cash and preferred stock. All of the outstanding
indebtedness of Brissette was paid in full by the sellers at the closing.
Pursuant to the Brissette purchase agreement, at the closing Brissette was
required to have working capital of at least $8.8 million and any amount in
excess thereof was to be paid to the sellers. By acquiring all of the capital
stock of Brissette, the Company acquired eight network-affiliated television
stations including WMTV- TV, the NBC affiliate serving Madison, Wisconsin;
WWLP-TV, the NBC affiliate serving Springfield, Massachusetts; WILX-TV, the NBC
affiliate serving Lansing, Michigan; WHOI-TV, the ABC affiliate serving Peoria,
Illinois; WSAW-TV, the CBS affiliate serving Wausau, Wisconsin; WTRF-TV, the CBS
affiliate serving Wheeling, West Virginia and Steubenville, Ohio; KAUZ-TV, the
CBS affiliate serving Wichita Falls, Texas; and KOSA-TV, the CBS affiliate
serving Odessa, Texas. Of the $270.0 million paid for the capital stock of
Brissette, $225.0 million was paid in cash and $45.0 million was paid by the
issuance of the junior preferred stock of the Company to General Electric
Capital Corporation ("GECC").

The Company has included Adjusted EBITDA and broadcast cash flow data
because such data is used by certain investors to measure a company's ability to
service debt. Adjusted EBITDA is used to pay principal and interest on long-term
debt and to fund capital expenditures. Adjusted EBITDA and broadcast cash flow
do not purport to represent cash provided by operating activities as reflected
in the Company's Consolidated Financial Statements, is not a measure of
financial performance under generally accepted accounting principles and should
not be considered in isolation or as a substitute for measures of performance
prepared in accordance with generally accepted accounting principles.

-32-

The following table sets forth certain historical results of the operations
and operating data for the periods indicated. The table includes the results of
operations of the Acquired Stations only from the closing date of June 6, 1996.
<TABLE>
<CAPTION>

Years Ended December 31,
-----------------------------------------------------
1994 1995 1996
---- ---- ----
(Dollars in Thousands)
<S> <C> <C> <C>
Operating income........................ $ 14,699 $ 14,662 $ 14,869
Add:
Amortization of program

broadcast rights................... 2,104 2,162 4,399
Depreciation and amortization....... 3,403 5,042 20,220
Corporate Expenses.................. 1,309 1,576 2,695
Less:
Payment for program

broadcast liabilities............. (1,888) (2,132) (3,318)
-------------- -------------- --------------
Broadcast cash flow................. $ 19,627 $ 21,310 $ 38,865
-------------- -------------- --------------
-------------- -------------- --------------
</TABLE>

The following table provides both historical and Same Station information.
The Same Station information gives effect to the acquisition of the Dothan
Station and the Acquired Stations as if such transactions were consummated
on January 1, 1995. The Same Station information for the years ended December
31, 1995 and 1996 does not purport to represent what the Company's results of
operations would have been if such transactions had been effected at such date
and do not purport to project results of operations of the Company in any future
period.

<TABLE>
<CAPTION>
Historical Same Station
Year Ended December 31, Year Ended December 31,
---------------------------------------------- ------------------------------------------
% %
1995 1996 Change 1995 1996 Change
---- ---- ------ ---- ---- ------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Net revenues....................... $ 50,329 $ 96,386 91.5% $120,617 $126,165 4.6%
------------ ----------- ----------- ------------ ------------ ---------
Operating expenses:
Selling, technical and
program expenses............... 21,199 43,759 106.4 51,842 57,332 10.6
General and administrative....... 7,850 14,843 89.1 19,683 20,239 2.8
Depreciation and amortization.... 5,041 20,220 301.1 28,138 29,955 6.4
Corporate........................ 1,576 2,695 71.0 3,200 3,700 15.6
------------ ----------- ----------- ------------ ------------ --------
35,666 81,517 128.4 102,863 111,226 8.1
------------ ----------- ----------- ------------ ------------ --------
OPERATING INCOME.......... $ 14,663 $ 14,869 1.4% $ 17,754 $ 14,939 (15.8)%
------------ ----------- ----------- ------------ ------------ --------
------------ ----------- ----------- ------------ ------------ --------

Broadcast cash flow................ $ 21,310 $ 38,865 82.4% $ 49,292 $ 49,741 1.0%
Broadcast cash flow margin......... 42.3% 40.3% 40.9% 39.4%
Adjusted EBITDA.................... $ 19,734 $ 36,170 83.3% $ 46,092 $ 46,041 (0.1)%
Adjusted EBITDA margin............. 39.2% 37.5% 38.2% 36.5%

</TABLE>

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995

Net revenues for the year ended December 31, 1996 increased $46.1 million or
91.5% to $96.4 million from $50.3 million for the year ended December 31, 1995
primarily as a result of the acquisition on June 6, 1996 of the Acquired
Stations which increased net revenue by $43.9 million. On a Same Station basis,
net revenues for the year ended December 31, 1996 increased $5.5 million or 4.6%
from the year ended December 31, 1995. On a Same Station basis, political
advertising revenue for the year ended December 31, 1996 increased by $8.4
million to $9.8 million. Gross revenues on a Same Station basis excluding
political advertising revenue decreased $1.4 million or 1.0% from the year ended
December 31, 1995.

-33-

Net revenues during the year ended December 31, 1996 were adversely affected
by an unexpected weakness in advertising revenues for the Company's 12 CBS
affiliated stations and six ABC affiliated stations which experienced a decline
in audience shares relative to NBC affiliates. On a Same Station basis, net
revenues of the Company's CBS affiliated stations increased by 0.9% and net
revenues of the Company's ABC affiliated stations increased by 5.2%, while net
revenues of the Company's NBC affiliated stations increased by 10.4%.

Operating expenses for the year ended December 31, 1996 increased $45.9
million or 128.5% to $81.5 million from $35.7 million for the year ended
December 31, 1995. Of the increase in operating expenses, $40.4 million was
attributable to the acquisition of the Acquired Stations and $2.8 million was
attributable to depreciation and amortization at the Benedek Stations owned by
Benedek Broadcasting for all of 1996. As a percentage of net revenues, operating
expenses for the Stations increased to 84.6% from 70.9% in the year ended
December 31, 1995, primarily as a result of an increase of $15.2 million in
depreciation and amortization expense. On a Same Station basis, operating
expenses for the year ended December 31, 1996 increased $8.4 million or 8.1%
from the year ended December 31, 1995. Such operating expenses were $111.2
million for the year ended December 31, 1996 as compared to $102.9 million for
the year ended December 31, 1995. The increase was primarily caused by
expansion of locally-produced news programs and increased depreciation and
amortization. Operating expenses as a percentage of net revenues on a Same
Station basis increased from 85.3% for the year ended December 31, 1995 to 88.2%
for the year ended December 31, 1996.

Operating income for the year ended December 31, 1996 increased $0.2 million
or 1.4% to $14.9 million from $14.7 million for the year ended December 31,
1995.

Financial (expenses), net for the year ended December 31, 1996 increased
$15.2 million or 98.3% to $30.7 million from $15.5 million in the year ended
December 31, 1995, due to the Company's higher debt level following the
completion of the financing of the purchase price for the Acquired Stations in
June 1996.

Income tax benefit for the year ended December 31, 1996 was $4.7 million
compared to none for the year ended December 31, 1995. Reductions in the
deferred tax liabilities related to the acquisitions and the creation of
deferred tax assets generated the income tax benefit for the year ended December
31, 1996. For the year ended December 31, 1995, the Company recognized no income
tax benefit due to its Subchapter S Corporation status.

Net loss for the year ended December 31, 1996 was $11.2 million as compared
to net income of $6.1 million for the year ended December 31, 1995. The year
ended December 31, 1995 included an extraordinary gain of $6.9 million on the
early extinguishment of debt.

Broadcast cash flow for the year ended December 31, 1996 increased $17.6
million or 82.4% to $38.9 million from $21.3 million for the year ended December
31, 1995 primarily as a result of the acquisition of the Acquired Stations. As a
percentage of net revenues, broadcast cash flow margin decreased to 40.3% for
the year ended December 31, 1996 from 42.3% for the year ended December 31,
1995. On a Same Station basis, broadcast cash flow for the year ended December
31, 1996 increased $0.4 million or 1.0% to $49.7 million from $49.3 million for
the year ended December 31, 1995. As a percentage of net revenues, broadcast
cash flow margin on a Same Station basis decreased to 39.4% for the year ended
December 31, 1996 from 40.9% for the year ended December 31, 1995.

-34-

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994

The following table (in thousands) sets forth certain historical results of
operations and operating data for the years ended December 31, 1994 and 1995.
The information does not include the results of operations of the 1996 Acquired
Stations.

<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------------------------------------
%
1994 1995 Change
---- ---- ------

<S> <C> <C> <C>
Net revenues.......................... $ 44,221 $ 50,329 13.8%
-----------------------------------------------------
Operating expenses:
Selling, technical and
program expenses.................. 17,740 21,199 19.5
General and administrative.......... 7,070 7,850 11.0
Depreciation and amortization....... 3,403 5,042 48.2
Corporate........................... 1,309 1,576 20.4
------------- ------------- -------------
29,522 35,667 2.8
------------- ------------- -------------
OPERATING INCOME........... $ 14,699 $ 14,662 0.3%
------------- ------------- -------------
------------- ------------- -------------

Broadcast cash flow................... $ 19,627 $ 21,310 8.6%
Broadcast cash flow margin............ 44.4% 42.3%
Adjusted EBITDA....................... $ 18,318 $ 19,734 7.7%
Adjusted EBITDA margin................ 41.4% 39.2%
</TABLE>

Net revenues for the year ended December 31, 1995 increased $6.1 million or
13.8% to $50.3 million from $44.2 million for the year ended December 31, 1994.
Of this increase, $5.0 million was attributable to the acquisition in March 1995
of the Dothan Station which serves Dothan, Alabama and Panama City, Florida. For
the eight Benedek Stations owned by the Company for all of 1994 and 1995, net
revenues for the year ended December 31, 1995 increased $1.1 million or 2.4%
from the year ended December 31, 1994. Gross revenues for such Benedek Stations
excluding political advertising revenue increased $2.9 million or 5.6% from 1994
to 1995. For such Benedek Stations, political advertising revenue for the year
ended December 31, 1995 decreased $1.8 million or 66.7% to $0.9 million from
$2.7 million for the year ended December 31, 1994.

Operating expenses for the year ended December 31, 1995 increased $6.1
million or 20.8% to $35.7 million from $29.5 million for the year ended December
31, 1994. Of the increase in operating expenses, $4.4 million was attributable
to the acquisition of the Dothan Station. As a percentage of net revenues,
operating expenses increased to 70.9% from 66.8% in the year ended December 31,
1994, primarily as a result of an increase of $1.6 million in depreciation and
amortization expense. For the eight Stations owned by the Company for all of
1994 and 1995, operating expenses for the year ended December 31, 1995 increased
$1.7 million or 5.9% from the year ended December 31, 1994. Operating expenses
as a percentage of net revenues for the years ended December 31, 1995 and 1994
for such Stations were 69.0% and 66.8%, respectively, primarily as a result of
an increase in depreciation and amortization from 7.7% to 8.0% of net revenues
and an increase in barter transactions, primarily related to programming and
promotion, from 4.0% to 5.0% of net revenues.

Operating income for the years ended December 31, 1995 and 1994 remained flat
at $14.7 million as a result of the above factors.

Financial (expenses), net for the year ended December 31, 1995 increased $2.8
million or 22.3% to $15.5 million from $12.7 million in the year ended December
31, 1994 due to the Company's higher debt level

-35-

following the offering of the Company's 11 7/8% Senior Secured Notes due 2005
(the "Senior Secured Notes") in March 1995.

Net income for the year ended December 31, 1995 increased to $6.1 million
from $2.0 million for the year ended December 31, 1994 primarily as a result of
a gain of $6.9 million on the early extinguishment of debt. This gain resulted
from the refinancing of the Company's debt from the proceeds of the offering of
the Senior Secured Notes in March 1995.

Broadcast cash flow for the year ended December 31, 1995 increased $1.7
million or 8.6% to $21.3 million from $19.6 million for the year ended December
31, 1994 primarily as a result of the acquisition of the Dothan Station. As a
percentage of net revenues, broadcast cash flow decreased to 42.3% for the year
ended December 31, 1995 from 44.4% for the year ended December 31, 1994.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows from Operating Activities is the primary source liquidity for the
Company and were $17.8 million for the year ended December 31, 1996 compared to
$3.3 million for the year ended December 31, 1995. For the year ended December
31, 1996, cash flows from operating activities included $2.5 million from the
bonus payment from CBS and $2.2 million of collections on net accounts
receivable provided by Stauffer. Noncash operating expenses, including
depreciation and amortization, increased due to the acquisition. Depreciation
and amortization caused operating income to decrease by $21.2 million without an
effect on cash flow. For the year ended December 31, 1995, cash flows from
operating activities primarily resulted from the refinancing of substantially
all of the Company's existing long-term debt in March 1995 and the payment of
$4.4 million of deferred and contingent interest and $2.7 million of prepayment
premiums. In addition, cash used by operations in 1995 included $6.9 million of
noncash gain on early extinguishment of debt.

Cash Flows from Investing Activities were $(326.6) million for the year ended
December 31, 1996 compared to $(31.0) million for the year ended December 31,
1995. For the year ended December 31, 1996, cash flows from investing activities
primarily resulted from the payment of $322.1 million for the Acquired Stations.
For the year ended December 31, 1995, cash flows used in investing activities
included $26.7 million paid to acquire the Dothan Station.

Cash Flows from Financing Activities were $307.2 million for the year ended
December 31, 1996 compared to $32.8 million for the year ended December 31,
1995. For the year ended December 31, 1996, cash flows from financing activities
resulted from the proceeds of financing the acquisitions of the Acquired
Stations. For the year ended December 31, 1995, cash flows from financing
activities primarily resulted from the issuance in March 1995 of $135.0 million
of the Company's Senior Secured Notes to refinance existing indebtedness and
finance the acquisition of the Dothan Station, offset by $96.0 million of
principal payments on existing indebtedness.

THE FINANCING PLAN

The Company, together with its subsidiary Benedek Broadcasting, implemented a
financing plan in order to finance the acquisitions of the Acquired Stations and
to pay fees and expenses related thereto. The financing plan consisted of (i)
the offer and sale by the Company of the Senior Subordinated Discount Notes (the
"Notes") to generate gross proceeds of $90.2 million, (ii) the sale by the
Company of units consisting of Exchangeable Redeemable Senior Preferred Stock
and warrants to generate gross proceeds of $60.0 million, (iii) Benedek
Broadcasting borrowing $128.0 million pursuant to the Term Loan Facilities of
the Credit Agreement and (iv) the Company issuing an aggregate of $45.0 million
initial liquidation preference of Seller

-36-

Junior Discount Preferred Stock to GECC and Mr. Paul Brissette. Benedek
Broadcasting currently also has available to it a $10.0 million revolving
credit facility under the Credit Agreement (the "Revolving Credit Facility").
At December 31, 1996, there were no outstanding borrowings under the Revolving
Credit Facility.

The Company believes that the financing plan will provide for a long-term
financing structure that will allow management to concentrate its efforts on
maximizing results of operations. The Company anticipates that Adjusted EBITDA
of Benedek Broadcasting will be sufficient to finance the operating requirements
of the Stations, debt service requirements and presently anticipated capital
expenditures until such time that the debt matures or requires payment in full
for at least the period until the Company is required to make cash payments in
respect of the Notes, the Exchangeable Redeemable Senior Preferred Stock and the
Seller Junior Discount Preferred Stock. The Company anticipates that capital
expenditures of approximately $7.8 million will be purchased in 1997. Such
capital expenditures will be financed either from cash provided by operations,
borrowings under the Revolving Credit Facility or purchase money financing.

The Notes do not bear interest until May 15, 2001, and the Company will not
be obligated to pay cash interest on the Notes until November 15, 2001. In
addition, for all dividend payment dates with respect to the Exchangeable
Redeemable Senior Preferred Stock and interest payment dates with respect to the
Notes through and including July 1, 2001, the Company may, at its option, pay
dividends by adding the amount thereof to the then effective liquidation
preference of the Exchangeable Redeemable Senior Preferred Stock or pay interest
on the Notes by issuing additional Notes. For all dividend payment dates with
respect to the Seller Junior Discount Preferred Stock prior to October 1, 2001,
the Company is required to pay such dividends by adding the amount thereof to
the then effective liquidation preference of the Seller Junior Discount
Preferred Stock. In order for the Company to meet its debt service obligations
after May 2001 with respect to the Notes and pay required dividends after July
1, 2001 with respect to the Exchangeable Redeemable Senior Preferred Stock and
from and after October 1, 2001 with respect to the Seller Junior Discount
Preferred Stock, the Company will need to substantially increase broadcast cash
flow at its stations or refinance. The Company's debt service obligations,
including scheduled principal amortization, in the 12 month period beginning
May 15, 2001 would be approximately $58.0 million (assuming that there will
not have been any mandatory or voluntary prepayments of any indebtedness prior
to that time and assuming a blended interest rate on the amounts then
outstanding under the Credit Agreement comparable to the rate the Company is
currently paying). The Company's cash dividend payments during such period
on the Exchangeable Redeemable Senior Preferred Stock and the Seller Junior
Discount Preferred Stock would be approximately $27.0 million.

In order to repay the Notes and Benedek Broadcasting's Senior Secured Notes
at maturity, the Company will need to refinance all or a portion of such notes.
The Company's ability to refinance the Notes and the Senior Secured Notes will
depend upon the Company's operating performance, as well as prevailing economic
and market conditions, levels of interest rates, refinancing costs and other
factors, many of which are beyond the Company's control.

The Company is a holding company that will derive all of its operating income
and Adjusted EBITDA from its sole subsidiary, Benedek Broadcasting, the common
stock of which, together with all other assets of the Company, have been pledged
to secure the Company's senior guarantee of all indebtedness of Benedek
Broadcasting outstanding under the Credit Agreement and in respect of the Senior
Secured Notes. As a holding company, the Company's ability to pay its
obligations, including its obligation to pay interest on and principal of the
Notes, whether at maturity, upon a change of control or otherwise, will be
dependent primarily upon receiving dividends and other payments or advances from
Benedek Broadcasting. Benedek Broadcasting is a separate and distinct legal
entity and has no obligation, contingent or otherwise, to pay any amounts to the
Company or to make funds available to the Company for debt service or any other
obligation. Although the Credit Agreement does not limit the ability of Benedek
Broadcasting to pay dividends or make other payments to the Company, the Senior
Secured Note Indenture does contain such limitations. However, after giving
effect to the implementation of the financing plan on June 6, 1996 (including
the contribution to the common equity

-37-

of Benedek Broadcasting of net cash proceeds of approximately $188.8 million
from the sale of the Notes, the Exchangeable Redeemable Senior Preferred Stock
and the Seller Junior Discount Preferred Stock), as of December 31, 1996,
Benedek Broadcasting could have distributed approximately $188.8 million to the
Company under such limitations.

The Credit Agreement entered into by Benedek Broadcasting as part of the
financing plan includes Term Loan Facilities and a Revolving Credit Facility. At
June 6, 1996, the Term Loan Facilities consisted of (i) Series A Facility of
$70.0 million and (ii) Series B Facility of $58.0 million. The Term Loan
Facilities generally provide for quarterly amortization until final maturity.
The Series A Facility will mature in June 2001 and the Series B Facility will
mature in December 2002. Benedek Broadcasting is required to make scheduled
amortization payments on the Term Loan Facilities, on an aggregate basis for
Series A and Series B Facilities, as follows: during 1997, $8.5 million; during
1998, $12.75 million; during 1999, $15.25 million; during 2000, $21.75 million;
during 2001, $21.25 million; and during 2002, $45.5 million.

In addition, Benedek Broadcasting will be required to make prepayments on the
Term Loan Facilities under certain circumstances, including upon certain asset
sales and issuance of debt or equity securities. Benedek Broadcasting will also
be required to make prepayments on the Term Loan Facilities in an amount equal
to 75% of excess cash flow (as defined) so long as the Company's ratio of debt
to Adjusted EBITDA remains above 6.75 and 50% of such excess cash flow if such
ratio is at or below 6.75. These mandatory prepayments will be applied to
prepay, on a pro rata basis, the Series A and Series B Facilities. The Series A
Facility bears interest, at Benedek Broadcasting's option, at a base rate plus a
spread or at a Eurodollar rate plus a spread. The Series B Facility bears
interest, at Benedek Broadcasting's option, at a base rate plus a spread or at a
Eurodollar rate plus a spread. The margins above the base rate and the
Eurodollar rate at which the Term Loan Facilities and Revolving Credit Facility
will bear interest are subject to reductions at such times as certain leverage
ratio performance tests are met.

The Company entered into an interest rate cap agreement which matures in May
1998 to reduce the impact of changes in interest rates on its floating-rate
long-term debt. That agreement effectively entitles Benedek Broadcasting to
receive from a financial institution the amount, if any, by which the London
Interbank Offering Rate (LIBOR) exceeds 7.36% on a notional amount totaling
$125,000,000 subject to an amortization schedule. Although Benedek Broadcasting
is exposed to credit loss in the event of nonperformance by the counterparty on
the interest rate cap, management does not expect nonperformance by the
counterparty.

Benedek Broadcasting has the ability, subject to a borrowing base and
compliance with certain covenants and conditions, to borrow up to an additional
$10.0 million for general corporate purposes pursuant to the Revolving Credit
Facility. The Revolving Credit Facility has a term expiring in 2001 and is fully
revolving until final maturity. The Revolving Credit Facility bears interest, at
Benedek Broadcasting's option, at a base rate plus a spread or at a Eurodollar
rate plus a spread.

The Term Loan Facilities and the Revolving Credit Facility are secured by
certain of Benedek Broadcasting's present and future property and assets. The
Term Loan Facilities are also guaranteed by Benedek License Corporation ("BLC"),
a wholly-owned subsidiary of Benedek Broadcasting that holds the FCC licenses
and authorizations for the Stations, and is secured by all of the stock of BLC.

The Term Loan Facilities and the Revolving Credit Facility contain certain
financial covenants, including, but not limited to, covenants related to cash
interest coverage, fixed charge coverage, bank debt/Adjusted EBITDA ratio, total
debt/Adjusted EBITDA ratio and minimum Adjusted EBITDA. In addition, the Term
Loan Facilities and the Revolving Credit Facility contain other affirmative and
negative covenants relating to (among other things) liens, payments on other
debt, restricted junior payments (excluding distributions from Benedek
Broadcasting to the Company) transactions with affiliates, mergers and
acquisitions, sales of assets,

-38-

guarantees and investments. The Term Loan Facilities and the Revolving Credit
Facility contain customary events of default for highly-leveraged financings,
including certain changes in ownership or control of Benedek Broadcasting or the
Company.

As a result of the lower than expected increases in net revenues on a Same
Station basis and the increases in operating expenses on a Same Station basis at
certain of the Acquired Stations during the second quarter prior to their
acquisition by the Company as described above, at September 30 and December 31,
1996, the Company did not meet certain financial ratios contained in the Credit
Agreement. The lenders under the Credit Agreement agreed to waive such
noncompliance. In connection with each such waiver, the Company agreed that
for so long as its ratio of debt to Adjusted EBITDA (as defined in the Credit
Agreement) exceeded certain levels, the Term Loan Facilities will bear interest
at varying additional spreads from that originally provided for in the Credit
Agreement. In connection with the waiver for December 1996, the Company and its
lenders revised the financial covenants applicable to the Company for the period
through the first half of 1998 and the Company agreed to reduce the Revolving
Credit Facility from $15.0 million to $10.0 million and to increase the
percentage of excess cash flow to be applied as prepayments of the Term Loan
Facilities from 50% to 75% until the Company's ratio of debt to Adjusted EBITDA
is at 6.75 or lower.

RECENT DEVELOPMENTS

In September 1996, the Company announced that it had reached an agreement in
principle with The Warner Bros. Television Network to develop a local cable
affiliate called the "WeB" in each of the Company's 20 markets which rank above
100. The WeB is intended to be a 24 hour, seven day a week television channel
which will broadcast Warner Bros. Network prime time programming, WB kids
programming and syndicated programming of Warner Bros. and others. The WeB is
scheduled to begin service in by the fall of 1998 in most 100-plus markets. The
Company will be responsible for all local sales efforts for the new channels in
its markets. The Company does not anticipate a significant effect on operations
during 1997 nor does it anticipate that significant capital expenditures will be
required in connection with the development of its WeB affiliates.

During 1996, Benedek Broadcasting made arrangements to acquire low power
television licenses in Columbia and Jefferson City, Missouri which is expected
to be completed in the second quarter 1997. Benedek Broadcasting does not expect
material expenditures for the acquisition of these licenses or immediate capital
needs.

SEASONALITY

Net revenues and Adjusted EBITDA of the Company are generally higher during
the fourth quarter of each year, primarily due to increased expenditures by
advertisers in anticipation of holiday season consumer spending and an increase
in viewership during this period, and, to a lesser extent, during the second
quarter of each year.

INCOME TAXES

Historically, Benedek Broadcasting had elected to be taxed as a Subchapter S
Corporation. Therefore, for the years ended December 31, 1994 and 1995, and for
the period January 1, 1996 through June 6, 1996, income taxes were not reflected
in the consolidated financial statements, but the income, deductions, losses and
credits were passed to Benedek Broadcasting's sole stockholder. Concurrent
with the completion of the financing for the acquisitions of the Acquired
Stations, Benedek Broadcasting's election to be taxed as a Subchapter S
Corporation was terminated and Benedek Broadcasting became subject to federal
and state income taxes. In conjunction with the acquisition of Brissette, a
deferred tax liability of $53.3 million was recognized primarily associated

-39-

with the variance between future tax deductions allowed for depreciation and
amortization of intangibles and the amount of such depreciation and amortization
that will be reflected for book purposes.

For the year ended December 31, 1996, a tax benefit of $5.4 million was
recognized consisting of a $5.6 million benefit related to the net reduction of
deferred income tax liabilities and $0.2 million of taxes currently due.

Under the provisions of the Internal Revenue Code, the Company has
approximately $9.4 million of actual net operating loss carryforwards available
to offset future tax liabilities of the Company, that begin to expire in 2007
through 2011.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

See pages F-1 and S-2.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

Not applicable.

-40-

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY.

The following table sets forth certain information with respect to each
director and executive officer of the Company:

<TABLE>
<CAPTION>
NAME AGE POSITION

<S> <C> <C>
A. Richard Benedek......................... 57 Chairman, Chief Executive Officer and Director
K. James Yager............................. 61 President and Director
Ronald L. Lindwall......................... 51 Senior Vice President-Finance, Chief Financial
Officer, Treasurer, Secretary and Director
Terrance F. Hurley......................... 40 Senior Vice President of Benedek Broadcasting
Keith L. Bland............................. 41 Senior Vice President-Planning and Technology of
Benedek Broadcasting
Mary L. Flodin............................. 41 Vice President and Controller
Jay Kriegel................................ 56 Director
Paul S. Goodman............................ 42 Director

</TABLE>

Mr. A. Richard Benedek has been engaged in the television broadcasting
industry for over 15 years. Mr. Benedek is the Chairman and Chief Executive
Officer of the Company. Mr. Benedek has served as Chairman and Chief Executive
Officer of Benedek Broadcasting since its formation in January 1979. From the
formation of Benedek Broadcasting until March 1995, Mr. Benedek also served as
President of Benedek Broadcasting. Additionally, Mr. Benedek has also served as
President and Chief Executive Officer of Blue Grass and Youngstown from their
formation in January 1980, and September 1982, respectively, until the Merger.
Prior to his activities in the television broadcasting industry, Mr. Benedek was
a partner in the investment banking firm of Bear, Stearns & Co. Inc.

Mr. K. James Yager has been engaged in the television broadcasting industry
for over 35 years. Mr. Yager is the President of the Company. Mr. Yager has
served as President of Benedek Broadcasting since March 1995. From 1987 until he
became President, Mr. Yager served as Executive Vice President of Benedek
Broadcasting. Mr. Yager has also served as Vice President of each of Blue Grass
and Youngstown from 1990 to 1993, respectively, until the Merger. Mr. Yager was
employed by Cosmos Broadcasting from 1960 until 1980, including as general
manager of its television stations in Columbia, South Carolina and New Orleans,
Louisiana. From 1980 until 1986, Mr. Yager was Executive Vice President and
Chief Operating Officer of Spartan Radiocasting, which then owned three
television stations and four radio stations.

Mr. Ronald L. Lindwall is the Senior Vice President-Finance, Chief
Financial Officer, Secretary and Treasurer of the Company. Mr. Lindwall has also
held the same positions at Benedek Broadcasting since March 1995. From 1990
until March 1995, Mr. Lindwall served as Senior Vice President, Chief Financial
Officer and Treasurer of Benedek Broadcasting. Mr. Lindwall has also served as
Senior Vice President, Chief Financial Officer and Treasurer of each of Blue
Grass and Youngstown from 1990 until the Merger. From 1982 to 1990, Mr. Lindwall
was a partner at the accounting firm of McGladrey & Pullen.

Mr. Terrance F. Hurley was recently promoted to Senior Vice President of
Benedek Broadcasting in anticipation of the completion of the Acquisitions. From
December 1995 until his promotion, Mr. Hurley served as Vice President/General
Manager of KDLH-TV serving Duluth, Minnesota and Superior, Wisconsin. Mr. Hurley
also served as General Manager of KDLH-TV from October 1994 until December 1995
and General Sales Manager of KHQA-TV serving Quincy, Illinois and Hannibal,
Missouri from May 1993 until

-41-

December 1995. From 1991 until May 1993, Mr. Hurley was employed by Dix
Communications as the General Sales Manager of KAAL-TV, serving Austin,
Minnesota.

Mr. Keith L. Bland has been engaged in the television broadcasting industry
for over 22 years. Mr. Bland has served as Vice President-Planning and
Technology of Benedek Broadcasting since January 1996. From March 1995 until
January 1996, Mr. Bland served as Vice President and General Manager of WTAP-TV
serving Parkersburg, West Virginia. Mr. Bland also served as General Manager of
WTAP-TV from January 1990 until March 1995, General Sales Manager of WIFR-TV
serving Rockford, Illinois from September 1989 until January 1990 and
Local/Regional Sales Manager of WIFR-TV from July 1987 until September 1989.

Ms. Mary L. Flodin is the Vice President and Controller of the Company. Ms.
Flodin has also held the same positions at Benedek Broadcasting since 1990. From
1988 to 1990, Ms. Flodin served as Controller of Benedek Broadcasting. Ms.
Flodin has also served as Vice President and Controller of each of Blue Grass
and Youngstown from 1990 until the Merger. From 1983 to 1988, Ms. Flodin served
in various financial capacities as Vice President of AMCORE Financial, Inc.

Mr. Jay L. Kriegel has been engaged in the communications industry for over
20 years. Since March 1994, Mr. Kriegel has been a counselor with the public
relations firm of Abernathy MacGregor Scanlon. From 1988 to 1994, Mr. Kriegel
was Senior Vice President of CBS Inc. Mr. Kriegel has served as a Director of
Benedek Broadcasting since May 1994 and as a Director of the Company since its
inception.

Mr. Paul S. Goodman has been corporate counsel to Benedek Broadcasting
since 1983 and the Company since its formation in 1996. Since April 1993, Mr.
Goodman has been a member of the law firm of Shack & Siegel, P.C. From January
1990 to April 1993, Mr. Goodman was a member of the law firm of Whitman &
Ransom. Mr. Goodman has served as a Director of Benedek Broadcasting since
November 1994 and as a Director of the Company since its inception.

In addition to the foregoing persons, the Company recently added two senior
executives to its corporate staff.

Mr. Raymond J. Schonbak was hired effective April 1, 1997 to serve as a
Senior Vice President of Benedek Broadcasting. Mr. Schonbak was the founder and
President of US Broadcast Group of Shelton, Connecticut from 1995 to 1997. He
served as the CEO of Triad Communications of San Francisco, California from 1991
to 1995. Before that, he held a variety of management positions in the broadcast
field beginning in 1970.

Mr. Raymond P. Maselli was promoted to Senior Vice President of Benedek
Broadcasting effective March 1997. Mr. Maselli has been with Benedek
Broadcasting as Vice President, General Manager of WYTV in Youngstown, Ohio
since 1989. He was the Vice President of Sales and Programming for WGR of
Buffalo, New York from 1983 to 1989. He started his broadcast career in 1965.

All directors hold office until their successors are duly elected and
qualify. Executive officers of the Company are appointed by the Board of
Directors and serve at the Board's discretion. Directors of the Company received
no cash compensation for such services to the Company during 1994. In 1995 and
1996, the Company paid each director who is not an employee of the Company
$2,500 per quarter and $500 per Board meeting for his services as a director. No
family relationship exists between any of the executive officers or directors of
the Company.

-42-

ITEM 11. EXECUTIVE COMPENSATION.

EXECUTIVE COMPENSATION.

The following table sets forth certain information concerning the
compensation paid to the Company's Chief Executive Officer and the other four
most highly-compensated executives during the fiscal years ended December 31,
1996, December 31, 1995 and December 31, 1994. The amounts set forth in the
following table for 1994 include amounts paid to the listed executive officers
by Benedek Group, Inc. which was owned by Messrs. Benedek, Yager and Lindwall
and which provided management and accounting services to the Company during part
of 1994.

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-------------------
ALL
OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($)(A)
--------------------------- ---- --------- -------- ------------------
<S> <C> <C> <C> <C>

A. Richard Benedek, Chairman and 1996 525,000 -- --
Chief Executive Officer 1995 475,000 -- --
1994 450,000 -- --

K. James Yager, President 1996 406,586 -- 2,293
1995 344,950 -- 2,300
1994 307,550 -- 2,700

Ronald L. Lindwall, Senior Vice President- 1996 150,000 25,000 2,293
Finance, Chief Financial Officer, Secretary 1995 107,652 55,000 2,310
and Treasurer 1994 109,808 10,000 1,859

Terrance F. Hurley, Senior Vice President 1996 141,114 25,000 1,498

Douglas E. Gealy, Executive Vice President (b) 1996 161,867 -- --
</TABLE>

- ---------------------------
(a) Represents the amount of the Company's contribution under its 401(k) plan.
(b) Mr. Gealy is no longer employed by the Company.

The following table sets forth the value, at December 31, 1996, of options
to purchase common stock of the Company held by the President of the Company,
all of which are exercisable. No other executive officer holds any options.

FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised Options In-the-Money Options at
at Fiscal Year-End Fiscal Year-End
----------------------------------------- -- ---------------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
K. James Yager....................... 370,000 -- $1,842,000(a) --
</TABLE>

- ---------------------------
(a) The value of the options at December 31, 1996 is based upon a multiple
Adjusted EBITDA. The Company believes this method of valuation is
reasonable because there is no public market for the shares underlying the
options and Adjusted EBITDA best represents the underlying value of the
Company. The multiple chosen by the Company is based on existing broadcast
market conditions. All of Mr. Yager's options are immediately exercisable.
The foregoing options, in the aggregate, will entitle Mr. Yager to acquire
shares representing 5% of the outstanding common stock of the Company,
after giving effect to the issuance thereof but prior to any dilution
resulting from the exercise of any of the warrants.

-43-

EMPLOYMENT AGREEMENTS

Mr. Benedek is employed by Benedek Broadcasting pursuant to an employment
agreement that expires May 31, 2000. During the term of the agreement, Mr.
Benedek is to be paid at a rate per annum of not less than $525,000. The
employment agreement requires Mr. Benedek to devote substantially all of his
business time to the business of Benedek Broadcasting and precludes Mr. Benedek
from engaging in activities competitive with the business of Benedek
Broadcasting throughout the term of the employment agreement.

Mr. Yager is employed by Benedek Broadcasting pursuant to an employment
agreement that expires May 31, 2000. During the term of the agreement, Mr. Yager
is to be paid at a rate per annum of not less than $400,000. The employment
agreement requires Mr. Yager to devote his full time to the business of Benedek
Broadcasting and precludes Mr. Yager from engaging in activities competitive
with the business of Benedek Broadcasting throughout the term of the employment
agreement.

Mr. Lindwall is employed by Benedek Broadcasting pursuant to an employment
agreement that expires May 31, 1999. During the term of the agreement, Mr.
Lindwall is to be paid at a rate per annum of not less than $150,000. The
employment agreement requires Mr. Lindwall to devote his full time to the
business of Benedek Broadcasting.

Mr. Hurley is employed by Benedek Broadcasting pursuant to an employment
agreement that expires May 31, 1999. During the term of the agreement, Mr.
Hurley is to be paid at a rate per annum of not less than $150,000. The
employment agreement requires Mr. Hurley to devote his full time to the business
of Benedek Broadcasting and precludes Mr. Hurley from engaging in activities
competitive with the business of Benedek Broadcasting throughout the term of the
employment agreement and for a period of one year thereafter with respect to
designated market areas then served by a television station owned by Benedek
Broadcasting.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Messrs. Benedek, Yager and Lindwall, all of whom are executive officers of
the Company, serve as Directors of the Company. Presently, the Company does not
have a compensation committee. Compensation for executive officers is
recommended to the Board of Directors by the Chief Executive Officer. In making
his compensation recommendations, the Chief Executive Officer considers several
criteria, including the Company's performance and growth, industry standards for
similarly situated companies and experience and qualitative performance of such
executive officers.

In March 1995, in connection with the formation of the LLC, Mr. Benedek
acquired a 1% membership interest in LLC in exchange for a non-interest bearing
promissory note in the principal amount of $581,200. Mr. Benedek entered into
this transaction as an accommodation to Benedek Broadcasting in conjunction with
its issuance of the Senior Secured Notes. In connection with the Transactions,
the LLC was merged into BLC, and Mr. Benedek was issued one share of BLC common
stock in exchange for his 1% interest in the LLC, which share was redeemed in
exchange for cancellation of the promissory note.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT.

Mr. Benedek owns 7,030,000 shares of Class B common stock of the Company,
representing all of its outstanding common stock.

-44-

Mr. Yager holds options to purchase 370,000 shares of Class B common stock
of the Company for an aggregate purchase price of approximately $1.2 million.
All of Mr. Yager's options are immediately exercisable.

ITEM 13. CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS.

Paul S. Goodman, a member of the law firm of Shack & Siegel, P.C., is a
director of the Company. During the fiscal year ended December 31, 1996, the
Company paid approximately $1,062,000 for legal services to Shack & Siegel, P.C.

-45-

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

(a)(1) Consolidated Financial Statements of the Company.

<TABLE>
<CAPTION>
Page
----
<S> <C>
Benedek Communications Corporation
and Subsidiaries
Independent Auditor's Report....................................................................... F-2
Consolidated Balance Sheets as of December 31, 1995 and 1996....................................... F-3
Consolidated Statements of Operations for the Three Years Ended
December 31, 1996................................................................................ F-4
Consolidated Statements of Stockholder's Deficit for the Years Ended
December 31, 1994, 1995 and 1996................................................................. F-5
Consolidated Statements of Cash Flows for the Three Years Ended
December 31, 1996................................................................................ F-6
Notes to Consolidated Financial Statements......................................................... F-8

(a)(2) Schedule II................................................................................... S-2
</TABLE>

All other schedules for which provision is made in the applicable
regulations of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable and, therefore, have been omitted.

-46-

EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)

PART IV

(a)(3) Exhibits.

3.1 -- Certificate of Incorporation of the Registrant, as amended,
incorporated by reference to Exhibit 3.1 to the Registrant's
Registration Statement on Form S-4, File No. 333-09529, filed on
August 2, 1996 (the "S-4 Registration Statement").

3.2 -- By-Laws of the Registrant, incorporated by reference to Exhibit
3.2 to the S-4 Registration Statement.

3.3 -- Certificate of Designation of the Powers, Preferences and
Relative, Participating, Optional and Other Special Rights of
15.0% Exchangeable Redeemable Senior Preferred Stock Due 2007 and
Qualifications, Limitations and Restrictions thereof, incorporated
by reference to Exhibit 3.3 to the S-4 Registration Statement.

3.4 -- Certificate of Designation, Preferences and Relative,
Participating, Optional and Other Special Rights of Series C
Junior Discount Preferred Stock and Qualifications, Limitations
and Restrictions thereof, incorporated by reference to Exhibit 3.4
to the S-4 Registration Statement.

4.1 -- Indenture dated as of May 15, 1996 between the Registrant and
United States Trust Company of New York, relating to the 13-1/4%
Senior Subordinated Discount Notes due 2006, incorporated by
reference to Exhibit 4.1 to the S-4 Registration Statement.

4.2 -- Form of 13-1/4% Senior Subordinated Discount Note due 2006
(included in Exhibit 4.1 hereof), incorporated by reference to
Exhibit 4.2 to the S-4 Registration Statement.

4.3 -- Indenture dated as of March 1, 1995 between Benedek Broadcasting
Corporation ("Benedek Broadcasting") and The Bank of New York,
relating to the 11-7/8% Senior Secured Notes due 2005 of Benedek
Broadcasting, incorporated by reference to Exhibit 4.3 to the S-4
Registration Statement.

4.4 -- Form of 11-7/8% Senior Secured Note due 2005 of Benedek
Broadcasting (included in Exhibit 4.3 hereof), incorporated by
reference to Exhibit 4.4 to the S-4 Registration Statement.

4.5 -- Certificate of Designation of the Powers, Preferences and
Relative, Participating, Optional and Other Special Rights of
15.0% Exchangeable Redeemable Senior Preferred Stock due 2007 and
Qualifications, Limitations and Restrictions thereof (filed as
Exhibit 3.3 hereof), incorporated by reference to Exhibit 4.5 to
the S-4 Registration Statement.

4.6 -- Certificate of Designation, Preferences and Relative,
Participating, Optional and Other Special Rights of Series C
Junior Discount Preferred Stock and Qualifications, Limitations
and Restrictions thereof (filed as Exhibit 3.4 hereof),
incorporated by reference to Exhibit 4.6 to the S-4 Registration
Statement.

4.7 -- Warrant Agreement dated as of June 5, 1996 between the
Registrant and IBJ Schroder Bank & Trust Company with respect to
Class A Common Stock of the Registrant, incorporated by reference
to Exhibit 4.7 to the S-4 Registration Statement.

10.1 -- Purchase Agreement dated May 30, 1996 between the Registrant
and Goldman, Sachs & Co., incorporated by reference to Exhibit
10.1 to the S-4 Registration Statement.

10.2 -- Exchange and Registration Rights Agreement dated May 30, 1996
between the Registrant and Goldman, Sachs & Co. with respect to
the 13-1/4% Senior Subordinated Discount Notes due 2006 of the
Registrant, incorporated by reference to Exhibit 10.2 to the S-4
Registration Statement.

-47-

10.3 -- Placement Agreement dated June 5, 1996 among the Registrant,
Goldman, Sachs & Co. and BT Securities Corporation, incorporated
by reference to Exhibit 10.3 to the S-4 Registration Statement.

10.4 -- Exchange and Registration Rights Agreement dated June 5, 1996
among the Registrant, Goldman, Sachs & Co. and BT Securities
Corporation with respect to the 15.0% Exchangeable Redeemable
Senior Preferred Stock due 2007 of the Registrant, incorporated by
reference to Exhibit 10.4 to the S-4 Registration Statement.

10.5 -- Warrant Agreement dated as of June 5, 1996 between the Registrant
and IBJ Schroder Bank & Trust Company (filed as Exhibit 4.7
hereof), incorporated by reference to Exhibit 10.5 to the S-4
Registration Statement.

10.6 -- Contingent Warrant Escrow Agreement dated June 5, 1996 between
the Registrant and IBJ Schroder Bank & Trust Company, incorporated
by reference to Exhibit 10.6 to the S-4 Registration Statement.

10.7 -- Common Stock Registration Rights Agreement dated as of June 5,
1996 among the Registrant, Goldman, Sachs & Co. and BT Securities
Corporation, incorporated by reference to Exhibit 10.7 to the S-4
Registration Statement.

10.8 -- Credit Agreement dated as of June 6, 1996 among the Registrant,
Benedek Broadcasting, the Lenders listed therein, Pearl Street
L.P., Goldman, Sachs & Co. and Canadian Imperial Bank of Commerce,
New York Agency, incorporated by reference to Exhibit 10.8 to the
S-4 Registration Statement.

10.9 -- Guaranty dated as of June 6, 1996 by the Registrant in favor of
Canadian Imperial Bank of Commerce, New York Agency, incorporated
by reference to Exhibit 10.9 to the S-4 Registration Statement.

10.10 -- Pledge Agreement dated as of June 6, 1996 between the Registrant
and Canadian Imperial Bank of Commerce, New York Agency,
incorporated by reference to Exhibit 10.10 to the S-4 Registration
Statement.

10.11 -- Security Agreement dated as of June 6, 1996 between the Registrant
and Canadian Imperial Bank of Commence, New York Agency,
incorporated by reference to Exhibit 10.11 to the S-4 Registration
Statement.

10.12 -- Collateral Account Agreement dated as of June 6, 1996 between the
Registrant and Canadian Imperial Bank of Commerce, New York
Agency, incorporated by reference to Exhibit 10.12 to the S-4
Registration Statement.

10.13 -- Third Party Account Agreement dated as of June 6, 1996 among the
Registrant, AMCORE Bank, N.A., Rockford and Canadian Imperial Bank
of Commerce, New York Agency, incorporated by reference to Exhibit
10.13 to the S-4 Registration Statement.

10.14 -- Form of Indemnity Agreement between the Registrant and each of its
executive officers and directors, incorporated by reference to
Exhibit 10.14 to the S-4 Registration Statement.

*10.15 -- Option Agreement dated as of June 6, 1996 between the Registrant
and K. James Yager.

10.16 -- Employment Agreement dated as of June 6, 1996 between the
Registrant and A. Richard Benedek, incorporated by reference to
Exhibit 10.16 to the S-4 Registration Statement.

10.17 -- Employment Agreement dated as of June 6, 1996 between the
Registrant and K. James Yager, incorporated by reference to
Exhibit 10.17 to the S-4 Registration Statement.

10.18 -- Employment Agreement dated as of June 6, 1996 between the
Registrant and Ronald L. Lindwall, incorporated by reference to
Exhibit 10.19 to the S-4 Registration Statement.

10.19 -- Employment Agreement dated as of June 6, 1996 between the
Registrant and Terrance F. Hurley, incorporated by reference to
Exhibit 10.20 to the S-4 Registration Statement.

10.20 -- Limited Waiver and First Amendment to Credit Agreement dated as of
October 31, 1996 among the Registrant, Benedek Broadcasting
Corporation, Goldman Sachs Credit Partners L.P., the

-48-

lenders listed therein and Canadian Imperial Bank of Commerce, New
York Agency, as Administrative Agent, incorporated by reference to
Exhibit 10.21 to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1996.

*10.21 -- Limited Waiver and Second Amendment to Credit Agreement dated
as of February 28, 1997 among the Registrant, Benedek
Broadcasting Corporation, Goldman Sachs Credit Partners L.P.,
the lenders listed therein and Canadian Imperial Bank of Commerce,
New York Agency, as Administrative Agent.

*21 -- Subsidiaries of the Company.

*23 -- Consent of McGladrey & Pullen, LLP with respect to the Company.

*27 -- Financial Data Schedule pursuant to Article 5 of Regulation S-X.

- ---------------
*Filed herewith

(b) Reports on Form 8-K

None.

-49-

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

BENEDEK COMMUNICATIONS CORPORATION
(REGISTRANT)

By: /s/ A. RICHARD BENEDEK
.............................
A. Richard Benedek
Chairman and Chief Executive Officer

DATE: March 27, 1997

Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

<TABLE>
<S> <C> <C>
SIGNATURE CAPACITY IN WHICH SIGNED DATE
/s/ A. RICHARD BENEDEK Chairman and Chief Executive Officer March 27, 1997
.................................... (Principal Executive Officer) and
A. Richard Benedek Director

/s/ K. JAMES YAGER President and Director March 27, 1997
....................................
K. James Yager

/s/ RONALD L. LINDWALL Senior Vice President-Finance, Chief March 27, 1997
.................................... Financial Officer, Secretary and
Ronald L. Lindwall Treasurer (Principal Financial and
Accounting Officer) and Director

/s/ JAY KRIEGEL Director March 27, 1997
....................................
Jay Kriegel

/s/ PAUL S. GOODMAN Director March 27, 1997
....................................
Paul S. Goodman
</TABLE>

-50-

INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Benedek Communications Corporation
and Subsidiaries
Independent Auditor's Report....................................................................... F-2
Consolidated Balance Sheets as of December 31, 1995 and 1996....................................... F-3
Consolidated Statements of Operations for the Three Years Ended
December 31, 1996................................................................................ F-4
Consolidated Statements of Stockholder's Deficit for the Years Ended
December 31, 1994, 1995 and 1996................................................................. F-5
Consolidated Statements of Cash Flows for the Three Years Ended
December 31, 1996................................................................................ F-6
Notes to Consolidated Financial Statements......................................................... F-8

F-1

INDEPENDENT AUDITOR'S REPORT

To the Board of Directors

Benedek Communications Corporation and Subsidiaries
Rockford, Illinois

We have audited the accompanying consolidated balance sheets of Benedek
Communications Corporation and subsidiaries as of December 31, 1995 and 1996 and
the related consolidated statements of operations, stockholder's deficit, and
cash flows for the years ended December 31, 1994, 1995 and 1996. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Benedek
Communications Corporation and subsidiaries as of December 31, 1995 and 1996 and
the results of their operations and their cash flows for the years ended
December 31, 1994, 1995 and 1996, in conformity with generally accepted
accounting principles.

/s/ McGLADREY & PULLEN, LLP

Rockford, Illinois
February 28, 1997

F-2

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

</TABLE>
<TABLE>
<CAPTION>
December 31, December 31,
ASSETS (Note G) 1995 1996
------------- -------------
<S> <C> <C>
Current Assets
Cash and cash equivalents ............................................. $ 9,668,331 $ 8,091,683
Receivables
Trade, less allowance for doubtful accounts of $249,023
$249,023 and $483,519 for 1996 and 1996, respectively $ ........ 23,744,311
and $483,519, for 1995 and 1996, respectively .................... 9,918,633 23,744,311
Due from Network ................................................... 2,500,000 --
Due from Seller .................................................... -- 474,011
Other .............................................................. 111,063 385,063
Current portion of program broadcast rights ........................... 1,575,325 4,427,832
Prepaid expenses ...................................................... 576,697 1,453,007
Deferred income taxes ................................................. -- 1,333,000
------------- -------------
TOTAL CURRENT ASSETS ................................... 24,350,049 39,908,907
------------- -------------
Property and Equipment (Note D) .......................................... 20,035,715 84,021,301
------------- -------------
Intangible Assets (Note E) ............................................... 60,420,617 354,622,296
------------- -------------
Other Assets

Program broadcast rights, less current portion (Note H) ............... 687,320 2,298,365
Deposit on acquisition ................................................ 3,000,000 --
Acquisition costs ..................................................... 225,359 --
Deferred loan costs ................................................... 5,625,261 13,385,766
Land held for sale .................................................... 109,000 109,000
Other ................................................................. -- 670,605
------------- -------------
9,646,940 16,463,736
------------- -------------
$ 114,453,321 $ 495,016,240
============= =============
LIABILITIES AND STOCKHOLDER'S DEFICIT
Current Liabilities
Current maturities of notes payable ................................... $ 318,077 $ 14,015,273
Current maturities of program broadcast rights payable ................ 2,042,643 6,119,953
Accounts payable and accrued expenses (Note I) ........................ 7,824,296 15,368,581
Deferred revenue ...................................................... 500,000 707,347
------------- -------------
TOTAL CURRENT LIABILITIES .............................. 10,685,016 36,211,154
------------- -------------
Long-Term Obligations
Notes payable (Note G) ................................................ 135,448,948 344,219,003
Program broadcast rights payable (Note H) ............................. 632,444 1,592,400
Deferred revenue ...................................................... 4,250,000 4,435,165
Deferred income taxes ................................................. -- 54,600,000
------------- -------------
140,331,392 404,846,568
------------- -------------
Exchangeable redeemable senior preferred stock (Note F) .................. -- 58,462,223
------------- -------------
Seller junior discount preferred stock (Note F) .......................... -- 47,057,040
------------- -------------
Commitments (Note H, J) Stockholder's Deficit (Note C, F, L)
Common stock, Class A $0.01 par value 25,000,000
authorized, none issued or outstanding ............................. -- --
Common stock, Class B $0.01 par value 25,000,000
authorized, 7,030,000 issued and outstanding ....................... 70,300 70,300
Additional paid-in capital ............................................ 2,253,229 (35,346,586)
Accumulated deficit ................................................... (38,886,616) (16,284,459)
------------- -------------
(36,563,087) (51,560,745)
------------- -------------
$ 114,453,321 $ 495,016,240
============= =============
</TABLE>

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

F-3

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Years Ended December 31,
-----------------------------------------------------------------
1994 1995 1996
---- ---- ----
<S> <C> <C> <C>
Net revenues........................................... $ 44,221,027 $ 50,329,019 $ 96,386,124
------------------ ------------------ ------------------
Operating expenses:
Selling, technical and program expenses............. 17,739,786 21,199,067 43,758,586
General and administrative.......................... 7,069,730 7,849,845 14,843,901
Depreciation and amortization....................... 3,403,263 5,041,719 20,219,589
Corporate (Note C).................................. 1,308,984 1,575,792 2,695,461
------------------ ------------------ ------------------
29,521,763 35,666,423 81,517,537
------------------ ------------------ ------------------
OPERATING INCOME................................. 14,699,264 14,662,596 14,868,587
------------------ ------------------ ------------------
Financial income (expense):
Interest expense (Note A):
Cash interest.................................... (7,904,530) (15,159,766) (22,841,333)
Other interest................................... (4,904,834) (711,934) (8,129,924)
------------------ ------------------ ------------------
(12,809,364) (15,871,700) (30,971,257)
Interest income 164,627 397,460 282,289
Other, net (10,168) - -
------------------ ------------------ ------------------
(12,654,905) (15,474,240) (30,688,968)
------------------ ------------------ ------------------
INCOME (LOSS) BEFORE INCOME TAX BENEFIT AND
EXTRAORDINARY ITEM............................... 2,044,359 (811,644) (15,820,381)
Income tax benefit..................................... - - 4,663,829
------------------ ------------------ ------------------
INCOME (LOSS) BEFORE EXTRAORDINARY ITEM.......... 2,044,359 (811,644) (11,156,552)
Extraordinary item, gain on early
extinguishment of debt (Note G)..................... - 6,863,762 -
------------------ ------------------ ------------------
NET INCOME (LOSS)................................ 2,044,359 6,052,118 (11,156,552)
Preferred stock dividends and accretion................ - - (9,519,263)
------------------ ------------------ ------------------
Net income (loss) applicable to common stock........... $ 2,044,359 $ 6,052,118 $ (20,675,815)
================== ================== ==================
Earnings (loss) per common share:
Income (loss) before extraordinary item............. $ 0.29 $ (0.12) $ (2.94)
Extraordinary item.................................. - 0.98 -
------------------ ------------------ ------------------
Earnings (loss) per common share.................... $ 0.29 $ 0.86 $ (2.94)
=================== ================== ==================
Weighted-average common shares outstanding............. 7,030,000 7,030,000 7,030,000
=================== ================== ==================

</TABLE>

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

F-4

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S DEFICIT
YEARS ENDED DECEMBER 31, 1994, 1995 AND 1996

<TABLE>
<CAPTION>
Additional
Common Paid-In Accumulated
Stock Capital Deficit Total
------------ ----------------- ----------------- ------------------
<S> <C> <C> <C> <C>
Balance at December 31, 1993.............. .$ 70,300 $ 2,253,229 $ (46,983,093) $ (44,659,564)
Net income............................. - - 2,044,359 2,044,359
------------ ----------------- ----------------- ------------------
Balance at December 31, 1994.............. 70,300 2,253,229 (44,938,734) (42,615,205)
Net income............................. - - 6,052,118 6,052,118
------------ ----------------- ----------------- ------------------
Balance at December 31, 1995.............. 70,300 2,253,229 (38,886,616) (36,563,087)
Allocation of proceeds from sale of
exchangeable redeemable senior
preferred stock to initial warrants. - 9,000,000 - 9,000,000
Accretion to exchangeable redeemable
senior preferred stock
(Note F)............................ - (2,205,095) - (2,205,095)
Financial costs related to the sale of
preferred stock..................... - (3,321,843) - (3,321,843)
Reclassification of accumulated deficit
due to change in income tax status.. - (41,072,877) 41,072,877 -
Dividends payable on preferred stock... - - (7,314,168) (7,314,168)
Net (loss)............................. - - (11,156,552) (11,156,552)
------------ ----------------- ----------------- -----------------
Balance at December 31, 1996.............. .$ 70,300 $ (35,346,586) $ (16,284,459) $ (51,560,745)
============ ================= ================= =================
</TABLE>

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

F-5

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
Years Ended December 31,
------------------------------------------------------------
1994 1995 1996
---- ---- ----
<S> <C> <C> <C>
Cash Flows From Operating Activities
Net income (loss)......................................... $ 2,044,359 $ 6,052,118 $(11,156,552)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Amortization of program broadcast rights............. 2,103,606 2,161,545 4,398,905
Depreciation and amortization........................ 2,133,940 3,268,939 13,809,443
(Gain) on early extinguishment of debt............... - (6,863,762) -
Amortization of intangibles and deferred loan costs.. 2,775,321 2,425,488 7,617,297
Amortization of note discount........................ - - 6,869,514
(Gain) loss on sale of property and equipment........ (55,222) 27,535 29,851
Payment of deferred and contingent interest.......... - (4,405,746) -
Payment of prepayment premiums....................... - (2,748,896) -
Deferred income taxes................................ - - (4,758,859)
Other................................................ 166,730 31,691 -
Changes in operating assets and liabilities, net of
effects of acquisitions:
Receivables.......................................... (329,105) (4,574,290) (722,447)
Due to sellers....................................... - - 2,187,723
Prepaid expenses and other........................... (102,858) (48,023) (266,267)
Payments on program broadcast rights payable......... (1,887,768) (2,131,990) (3,317,527)
Accounts payable and accrued expenses................ 357,041 4,738,408 3,566,204
Deferred revenue..................................... - 4,750,000 (414,410)
Deferred and contingent interest payable............. 3,287,331 567,533 -
----------------- ---------------- ----------------
NET CASH PROVIDED BY OPERATING ACTIVITIES............ 10,493,375 3,250,550 17,842,875
----------------- ---------------- ----------------
Cash Flows From Investing Activities
Purchase of property and equipment........................ (3,695,187)
Progress payments on equipment not in service............. - - (469,615)
Proceeds from sale of equipment........................... 75,380 425,994 206,754
Payment for acquisition of stations....................... - (26,698,516) (322,081,822)
Deposit on acquisition.................................... - (3,000,000) -
Advance to affiliate...................................... (2,000,000) - -
Payment of acquisition costs.............................. - (225,359) -
Purchase of other assets ................................. - - (670,605)
Other .................................................... (8,267) 4,504 78,834
----------------- ---------------- ----------------
NET CASH (USED IN) INVESTING ACTIVITIES.............. (2,507,058) (30,972,270) (326,631,641)
----------------- ---------------- ----------------
Cash Flows From Financing Activities
Principal payments on notes and capital leases payable.... (5,795,902) (96,351,288) (3,647,514)
Proceeds from issuance of preferred stock................. - - 105,000,000
Proceeds from long-term borrowing......................... - 135,000,000 218,178,200
Payment of debt and preferred stock acquisition costs..... (1,240,602) (5,875,903) (12,318,568)
----------------- ---------------- ----------------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES.. (7,036,504) 32,772,809 307,212,118
----------------- ---------------- ----------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS..... 949,813 5,051,089 (1,576,648)

Cash and cash equivalents:
Beginning................................................. 3,667,429 4,617,242 9,668,331
----------------- ---------------- ----------------
Ending.................................................... $ 4,617,242 $ 9,668,331 $ 8,091,683
================= ================ ================

(Continued)

</TABLE>

F-6

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------------------------------------------
1994 1995 1996
---- ---- ----
<S> <C> <C> <C>
Supplemental Disclosure of Cash Flow Information
Cash payments for interest................................ $ 7,904,530 $ 13,654,225 $ 20,945,188
================= ================ ================
Supplemental Schedule of Noncash Investing and
and Financing Activities
Acquisition of program broadcast rights................... $ 2,044,692 $ 2,558,122 $ 4,629,978
Note payable incurred for purchase of equipment........... 273,995 197,288 1,067,051
Equipment acquired by barter transactions................. 312,965 331,843 161,114
Dividends accrued on redeemable preferred stock........... - - 7,314,168
Accretion to exchangeable redeemable senior
preferred stock........................................ - - 2,205,095
Accounts payable transferred to note payable.............. 88,079 - -
================= ================ ================
Acquisition of stations:
Cash purchase price....................................... $ 26,698,516 $ 322,081,822
================ ================
Net working capital acquired, excluding cash of $535,810
in 1996................................................ $ - $ 9,982,264
Property and equipment acquired at fair market value...... 7,533,196 72,578,064
Intangible assets acquired................................ 21,306,181 300,558,565
Deferred income taxes assumed............................. - (58,025,859)
Other, net................................................ (140,861) 214,147
---------------- ----------------
28,698,516 325,307,181
Less: Application of advance to affiliate................. (2,000,000) -
Less: Amount paid in 1995................................. - (3,225,359)
---------------- ----------------
$ 26,698,516 $ 322,081,822
================ ================

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

F-7

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(NOTE A) - NATURE OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES

NATURE OF BUSINESS:

Benedek Communications Corporation (the "Company") was formed on April 10,
1996. The Company is a holding company that derives its operating income and
cash flow from its subsidiary, Benedek Broadcasting Corporation ("Benedek
Broadcasting") which owns and operates twenty-two television stations (the
"Stations") located throughout the United States. These stations operate under
network affiliation contracts, which provide programs to the affiliated stations
and the stations sell commercial time during the programs to national, regional
and local advertisers. The networks also sell commercial time during the
programs to national advertisers. Credit arrangements are determined on an
individual customer basis.

BASIS OF PRESENTATION:

The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiary Benedek Broadcasting and Benedek License
Corporation (BLC), a wholly owned subsidiary of Benedek Broadcasting. All
significant intercompany items and transactions have been eliminated in the
consolidated financial statements. Benedek Broadcasting and the Company had
identical stock ownership, so the capitalization of the Company by the
stockholder with Benedek Broadcasting stock was accounted for in a manner
similar to pooling-of-interests accounting. These consolidated financial
statements include the consolidated financial statements of Benedek Broadcasting
for the period prior to June 6, 1996 recast to reflect the difference in par
value of the Company's and Benedek Broadcasting's stock.

SIGNIFICANT ACCOUNTING POLICIES:

(1) ACCOUNTING ESTIMATES:

The preparation of financial statements requires management to make
estimates and assumptions that affect the reported amounts in financial
statements and the accompanying notes. Actual results could differ from those
estimates.

(2) CASH EQUIVALENTS AND CONCENTRATION:

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

At various times during the periods, the Company had cash and cash
equivalents on deposit with a financial institution in excess of federal
depository insurance limits. The Company has not experienced any credit losses
on these deposits.

(3) REVENUES:

Revenue related to the sale of advertising, network compensation and
contracted time is recognized at the time of broadcast. Net revenues are shown
net of agency and national representatives commissions.

F-8

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Deferred revenues primarily relate to compensation due from the network and
national sales representatives at the inception of the network affiliation
agreement and the national sales representative agreements, respectively. These
revenues are recognized over the life of the agreement on a straight-line
method. Since these payments are earned over the life of the respective
agreements, the network affiliation payment is recognized over ten years and the
national sales representative payments are recognized over five years.

(4) BARTER TRANSACTIONS:

Revenue from barter transactions (advertising provided in exchange for
goods and services) is recognized as income when advertisements are broadcast
and merchandise or services received are charged to expense (or capitalized as
appropriate) when received or used. The transactions are recorded at the fair
market value of the asset or service received.

(5) PROGRAM BROADCAST RIGHTS AND LIABILITIES:

Program broadcast rights represent rights for the telecast of feature
length motion pictures, series produced for television and other films, and are
presented at the lower of amortized cost or net realizable value. Each agreement
is recorded as an asset and liability when the license period begins and the
program is available for its first showing. Program broadcast rights are
amortized on a straight-line method over the life of the contract, which is
included in selling, technical and program expenses. The agreements are
classified between current and long-term assets according to the estimated time
of future usage. The related liability is classified between current and
long-term on the basis of the payment terms.

(6) DEFERRED LOAN AND ACQUISITION COSTS:

Deferred loan costs are amounts incurred in connection with long-term
financing. The costs are amortized on a straight-line method over the terms of
the related debt security. Costs incurred in connection with long-term financing
which is not consummated are expensed at the point in time when the negotiation
on the financing ceases. Costs incurred in connection with the issuance of
preferred stock are included in stockholder's deficit as a permanent reduction
of additional paid-in capital.

Acquisition costs are amounts incurred in connection with acquiring
additional television stations. Costs incurred in connection with acquisitions
which are not consummated are expensed at the point of time when the negotiation
on the acquisition ceases. The acquisition costs related to successful
acquisitions are treated as part of the purchase price and are allocated to the
assets purchased.

Included in other interest for 1994 are costs of approximately $900,000
related to a financing not consummated.

F-9

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(7) PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS:

(a) Property and equipment are recorded at cost and depreciated using the
straight-line method over the following estimated ranges of useful
lives:

Years
----
Buildings and improvements 5-40
Towers 5-12
Transmission equipment 3-10
Other equipment 1-5

The Company records amortization expense on leased assets with the
depreciation expense on owned assets. Gains and losses on the disposition of
property and equipment are insignificant and included in depreciation and
amortization on the consolidated statement of operations.

(b) Intangible assets, which include FCC licenses, network affiliation
agreements and goodwill, have been recorded at cost and are amortized over 40
years using the straight-line method.

(c) The Company reviews their property and equipment and intangibles
annually to determine potential impairment by comparing the carrying value of
the assets with the undiscounted anticipated future cash flows of the related
property before interest charges. If the future cash flows are less than the
carrying value, the Company would obtain an appraisal on the property and adjust
the carrying value of the assets to the appraisal value if the appraisal value
is less than the carrying value.

(8) OTHER INTEREST EXPENSE:

Other interest expense includes interest due to the increase in the BBC
Warrants, contingent equity value, accrued interest added to long-term debt
balances, deferred loan cost amortization, financing costs not consummated, and
accretion of discounts.

(9) INCOME TAXES:

Deferred taxes are provided on a liability method whereby deferred tax
assets are recognized for deductible temporary differences, operating losses and
tax credit carryforwards. Deferred tax liabilities are recognized for taxable
temporary differences. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax bases. Deferred tax
assets are reduced by a valuation allowance when, in the opinion of management,
it is more likely than not that some portion or all of the deferred tax assets
will not be realized. Deferred tax assets and liabilities are adjusted for the
effects of changes in tax laws and rates on the date of enactment. Reference
should also be made to (Note K) regarding a change in tax status and the
recording of deferred taxes upon change in status.

F-10

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(10) INTEREST RATE CAP AGREEMENT:

Interest rate cap agreements are used to manage interest rate exposure by
hedging certain liabilities. Income and expense are accrued under the terms of
the agreement based on the expected settlement payments and are recorded as a
component of interest income or expense.

(11) EMPLOYEE BENEFITS:

The Company has a defined contribution plan covering all eligible
employees. The Company's contribution is at the discretion of the Board of
Directors.

The Company self-insures for health benefits which are provided to all
full-time employees with specified periods of service. Insurance coverage is
maintained by the Company for claims in excess of specific and annual aggregate
limits.

Benedek Broadcasting has elected to continue accounting for stock-based
compensation under Accounting Principles Board Opinion No. 25.

(12) EARNINGS (LOSS) PER COMMON SHARE:

Earnings (loss) per common share is computed by dividing income (loss)
after the deduction of preferred dividends and accretion of the redemption
prepayment premium and amortization of the initial warrants, by the
weighted-average number of common shares outstanding. The effect of the stock
options, initial warrants and contingent warrants has not been reflected in the
computation since their inclusion as common stock equivalents for both primary
and fully-diluted earnings (loss) per share was anti-dilutive.

(NOTE B) - ACQUISITIONS, RELATED PARTY AND BUSINESS COMBINATIONS

The Company was formed by the sole stockholder of Benedek Broadcasting. On
June 6, 1996, two acquisition agreements entered into during 1995 by Benedek
Broadcasting were consummated. These agreements were to acquire (i) the assets
of the television broadcasting division of Stauffer Communications, Inc., which
owned five television stations for a total purchase price of $54,500,000 and
(ii) all the issued and outstanding capital stock of Brissette Broadcasting
Corporation which owned and operated eight television stations for a purchase
price of $270,000,000. At the closing of these acquisitions, the sole
stockholder of Benedek Broadcasting contributed all of the outstanding shares of
common stock of Benedek Broadcasting to the Company in exchange for the issuance
to him of all of the outstanding shares of common stock of the Company.

On March 31, 1995, the Company acquired substantially all the assets of
WTVY-TV, a television station serving Dothan, Alabama and Panama City, Florida,
for an aggregate purchase price of approximately $28,699,000.

These acquisitions have been accounted for under the purchase method of
accounting. Accordingly, the results of operations of the acquired stations are
included in the consolidated financial statements since the

F-11

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

date of the respective acquisitions. The purchase price has been allocated to
the acquired assets and liabilities based on their relative fair values as of
the closing date. The excess of the purchase price over the net assets received
from these acquisitions is being amortized on a straight-line method over a
period of 40 years.

The pro forma results of operations and earnings per share for the years
ended December 31, 1994, 1995 and 1996, assuming the acquisition of WTVY-TV had
taken place on January 1, 1994, and the acquisitions of Stauffer Communications,
Inc. and Brissette Broadcasting Corporation had taken place on January 1, 1995,
are as follows:

</TABLE>
<TABLE>
<CAPTION>

Year Ended December 31,
-------------------------------------------------------------------
1994 1995 1996
---- ---- ----
<S> <C> <C> <C>
Net revenue.......................................... $ 51,582,464 $ 120,616,960 $ 126,165,117
Operating expenses................................... 35,647,105 102,866,162 111,175,446
Financial expenses................................... 16,442,853 41,270,999 43,289,518
----------------- ------------------- -------------------
(Loss) before income tax benefit and extraordinary
item......................................... (507,494) (23,520,201) (28,299,847)
Income tax benefit................................... - 9,154,022 9,865,815
----------------- ------------------- -------------------
(Loss) before extraordinary item................. (507,494) (14,366,179) (18,434,032)
Extraordinary Item................................... - 6,863,762 -
----------------- ------------------- -------------------
Net (loss)........................................ (507,494) (7,502,417) (18,434,032)
Preferred stock dividends and amortization........... - 17,261,191 19,395,023
----------------- ------------------- -------------------
Net (loss) applicable to common shares............ $ (507,494) $ (24,763,608) $ (37,829,055)
================= =================== ===================
Earnings (loss) per common share:
Loss before extraordinary item.................... $ (0.07) $ (4.50) $ (5.38)
Extraordinary item................................ - 0.98 -
----------------- ------------------- -------------------
Loss per common share............................. $ (0.07) $ (3.52) $ (5.38)
================= =================== ===================
Weighted-average common shares outstanding........... 7,030,000 7,030,000 7,030,000
================= =================== ===================
</TABLE>

(NOTE C) - RELATED PARTY TRANSACTIONS

(1) ADMINISTRATIVE SERVICES:

The Company paid management fees of approximately $1,309,000 in 1994 to a
company which was affiliated through common ownership. These services were
terminated January 1, 1995.

(2) BENEDEK LICENSE CORPORATION:

On April 18, 1996, Benedek Broadcasting formed BLC for the purpose of
holding the licenses and authorizations issued by the FCC in connection with the
operations of the Stations. Concurrently with the acquisitions described in
(Note B), Benedek Broadcasting Company, L.L.C., which had been formed in 1995
for the same purposes and was holding the licenses of Benedek Broadcasting
stations, was merged into BLC with the result that all licenses of the acquired
stations were transferred to BLC. This was accounted for in a manner similar to
that in pooling-of-interests accounting.

F-12

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(3) STOCK OPTION AGREEMENTS:

In 1988 and 1995, the Company granted options whereby a key employee can
exercise these options to purchase 130,784 shares and 239,216 shares of common
stock, Class B, at exercise prices of $1.58 per share and $4.12 per share,
respectively, which was the fair market values on the respective grant dates.
These options will entitle the key employee to shares representing 5% of the
outstanding common stock, Class, B, of the Company after giving effect to the
issuance thereof and before the conversion of the initial or the contingent
warrants. The 1988 and 1995 options are exercisable at any time and expire in
1998 and 2004, respectively. As permitted under generally accepted accounting
principles, the Company accounts for the options under the provisions of APB
Opinion No. 25 and its related interpretations. Accordingly, no compensation
cost has been recognized for the grant of the options. Had compensation cost
been determined based on the fair value method proscribed in FASB Statement No.
123, the reported net income (loss) and earnings (loss) per common share would
have been as follows:

Year Ended Net Income
December 31, (Loss) Per Share
------------ ------ ---------
1994 $ 2,044,359 $ 0.29
1995 5,667,500 0.81
1996 (20,675,815) (2.94)

In determining the pro forma amounts, the fair value per share for each
option for the 1995 grant was estimated to be $2.68 per share at the grant date
by using the Black-Sholes option-pricing model with the following assumptions:
no dividends will be paid on the common stock, Class B; a risk-free interest
rate of 6.3%; an expected life of nine years; and an expected price volatility
of 45%.

No options have been exercised to date and all options granted are
outstanding at December 31, 1996. The following summarizes the options
outstanding, exercisable and the average exercise prices at the end of each
year.

Weighted
Year Ended Options Options Average
December 31, Outstanding Exercisable Exercise Price
------------ ----------- ----------- --------------
1994 130,784 130,784 $ 1.58
1995 370,000 370,000 3.22
1996 370,000 370,000 3.22

F-13

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(NOTE D) - PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
December 31,
--------------------------------------------
1995 1996
---- ----
<S> <C> <C>
Land and improvements............................................. $ 1,259,938 $ 5,823,110
Buildings and improvements........................................ 12,183,267 25,242,538
Towers............................................................ 5,786,099 14,772,011
Transmission and studio equipment................................. 23,205,748 68,156,721
Office equipment.................................................. 3,024,834 7,025,892
Records and tapes................................................. 22,732 143,853
Transportation equipment.......................................... 708,152 2,236,900
Construction in progress.......................................... 150,188 469,616
-------------------- ------------------
46,340,958 123,870,641
Less accumulated depreciation and amortization.................... 26,305,243 39,849,340
-------------------- ------------------
$ 20,035,715 $ 84,021,301
==================== ==================
</TABLE>

(NOTE E) - INTANGIBLE ASSETS

Intangible assets consist of the following:

<TABLE>
<CAPTION>
December 31,
---------------------------------------------
1995 1996
---- ----
<S> <C> <C>
Goodwill........................................................ $ 28,837,585 $ 167,631,166
FCC licenses.................................................... 15,304,138 123,538,650
Network affiliations............................................ 15,998,174 61,507,881
Other........................................................... 280,720 1,944,599
------------------- -------------------
$ 60,420,617 $ 354,622,296
=================== ===================
</TABLE>

Intangible assets are recorded net of accumulated amortization of
$13,325,299 and $19,729,105 as of December 31, 1995 and 1996, respectively.

(NOTE F) - REDEEMABLE EQUITY SECURITIES AND DISCOUNT NOTES

Concurrent with the acquisitions described in (Note B), the Company entered
into the following financing transactions, the net proceeds of which were
contributed by the Company to Benedek Broadcasting.

(1) The Company sold 60,000 Units in a private placement, which generated
proceeds of $60,000,000. Each Unit consists of (i) ten shares of
Exchangeable Redeemable Senior Preferred Stock, (ii) ten Initial
Warrants, and (iii) 14.8 Contingent Warrants.

F-14

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(i) Exchangeable Redeemable Senior Preferred Stock - The Company
issued 600,000 shares of 15% Exchangeable Redeemable Senior
Preferred Stock due 2007, with an initial liquidation preference
equal to the proceeds received of $60,000,000. Of these proceeds,
$9,000,000 was allocated to the initial warrants described in
(ii). The exchangeable redeemable senior preferred stock is being
accreted to its initial liquidation preference of $60,000,000
using the effective interest method commencing on June 6, 1996 and
ending on July 1, 2000. Dividends are payable to holders of the
outstanding shares at the rate of 15% per annum of the then
effective liquidation preference per share, payable quarterly
beginning July 1, 1996 and accruing from June 6, 1996. The Company
has the option to pay dividends on any dividend payment date
occurring on or before July 1, 2001 either in cash or by adding
such dividends to the then effective liquidation preference. The
Company also has the option to immediately redeem these shares, in
whole or in part, at predetermined redemption prices. The Company
is required to redeem the outstanding shares on July 1, 2007 at a
redemption price equal to 100% of the then effective liquidation
preference plus any accrued and unpaid dividends to the date of
redemption. The Exchangeable Redeemable Senior Preferred Stock is
exchangeable into debentures at the Company's option, subject to
certain conditions, in whole on any scheduled dividend payment
due. The Exchangeable Redeemable Senior Preferred Stock has been
registered with the Securities and Exchange Commission pursuant to
a registration statement declared effective in October 1996.

(ii) Initial Warrants - The Company issued 600,000 Initial Warrants
which expire on July 1, 2007 each of which entitles the holder
thereof to purchase one share of Class A Common Stock at a price
of $0.01 per share. The value of the warrants at date of issuance
was $9,000,000 which was allocated to paid-in capital.

(iii) Contingent Warrants - The Company issued 888,000 Contingent
Warrants, each warrant to acquire one share of Class A Common
Stock at an exercise price of $0.01 per share. The Contingent
Warrants were issued to an escrow agent and are not outstanding.
The Contingent Warrants are not separable from the Exchangeable
Redeemable Senior Preferred Stock and will not be delivered out of
escrow unless the Exchangeable Redeemable Senior Preferred Stock
is not redeemed on or prior to July 1, 2000. Since it is
management's intention to redeem the Exchangeable Redeemable
Senior Preferred Stock prior to any release of the Contingent
Warrants from escrow subject to a 15% redemption premium, no
allocation of the proceeds was made to the Contingent Warrants and
the amount of the redemption premium payable at such time is being
accreted as a constructive distribution over the period commencing
on the issue date June 6, 1996 and ending on July 1, 2000.

(2) Seller Junior Discount Preferred Stock - The Company issued 450,000
shares of Seller Junior Discount Preferred Stock due July 1, 2008 with
an aggregate liquidation preference equal to the proceeds of
$45,000,000. Dividends are payable to the holders of the Seller Junior
Discount Preferred Stock at 7.92% per annum until the fifth anniversary
of the issuance thereof and thereafter at increasing rates up to 18%.
Since the Company intends to redeem the Seller Junior Discount Preferred
Stock prior to the fifth anniversary, dividends are being accrued at the
initial rate. The

F-15

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

dividends on the Seller Junior Discount Preferred Stock are cumulative
from date of issuance. Until the fifth anniversary of the issuance
thereof, dividend payments on the Seller Junior Discount Preferred Stock
may not be made in cash and instead will be added automatically to the
liquidation preference and as a result will be deemed paid in full and
will not accumulate. The Seller Junior Discount Preferred Stock is
subject to mandatory redemption in whole on July 1, 2008 and the Company
has the option to redeem these shares in whole or in part at a price
equal to the sum of the liquidation value per share plus an amount equal
to all accumulated and unpaid dividends per share to the date of
redemption.

(3) 13 1/4% Senior Subordinated Discount Notes due 2006 - The Company issued
Senior Subordinated Discount Notes with a principal amount of
$170,000,000. These Notes were issued at a discount of $79,821,800 which
generated gross proceeds of $90,178,200. The Notes mature on May 15,
2006 and yield 13.25% per annum with no cash interest accruing prior to
May 15, 2001. Thereafter, cash interest will accrue until maturity
payable semiannually, commencing November 15, 2001. On or after May 15,
2000, the Notes are redeemable at the option of the Company, in whole or
in part, at predetermined redemption prices and under specified
conditions. The Notes are subordinated to all Senior Debt of the
Company. These Notes contain various restrictive covenants, all of which
the Company was in compliance with at December 31, 1996. The Senior
Subordinated Discount Notes have been registered with the Securities and
Exchange Commission pursuant to a registration statement declared
effective in October 1996.

The following table summarizes these activities as follows:

<TABLE>
<CAPTION>
Exchangeable
Redeemable Seller 13 1/4%
Senior Junior Discount Senior
Preferred Initial Preferred Subordinated
Stock Warrants Stock Discount Notes
-------------------- ------------------ ----------------- -----------------
<S> <C> <C> <C> <C>
Issuance of preferred stock......... $ 51,000,000 $ 9,000,000 $ 45,000,000 $ -
Issuance of senior subordinated
discount notes................... - - - 90,178,200
Accrued dividends................... 5,257,128 - 2,057,040 -
Accretion of initial warrants and
redemption prepayment
premium on exchangeable
redeemable senior preferred
stock............................ 2,205,095 (2,205,095) - -
Amortization of note discount....... - - - 6,869,514
-------------------- ------------------ ----------------- -----------------
Balance at December 31, 1996........ $ 58,462,223 $ 6,794,905 $ 47,057,040 $ 97,047,714
==================== ================== ================= =================
</TABLE>

Since the Company derives all of its operating income and cash flow from
Benedek Broadcasting, the Company's ability to pay its obligations including (i)
interest on and principal of the senior subordinated discount notes, (ii)
redemption of and cash dividends on the exchangeable preferred stock, and (iii)
redemption of and cash dividends on the seller junior discount preferred stock
will be dependent primarily upon receiving dividends and other payments or
advances from Benedek Broadcasting. Benedek

F-16

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Broadcasting is a separate and distinct legal entity and has no obligation,
contingent or otherwise, to pay any amounts to the Company or to make funds
available to the Company for debt service or any other obligation.

(NOTE G) - NOTES PAYABLE, INTEREST RATE CAP, GAIN ON EXTINGUISHMENT OF DEBT AND
SUBSEQUENT EVENT

(1) NOTES PAYABLE

(a) Term Loans and Revolver. As part of the financing transactions
described in Note F, on June 6, 1996, Benedek Broadcasting entered into a new
credit agreement which includes two Term Loan Facilities consisting of (i) a
Series A Facility of $70,000,000 at the bank's base rate plus 2.25% or the
Eurodollar rate plus 3.25% per annum (currently 8.81%) and (ii) a Series B
Facility of $58,000,000 at the bank's base rate plus 2.75% or the Eurodollar
rate plus 3.75% per annum (currently 9.31%). The Term Loan Facilities provide
for quarterly principal payments until final maturity (except in the first year
during which amortization will be on a semiannual basis). The Series A Facility
and the Series B Facility mature on May 1, 2001 and November 1, 2002,
respectively. Benedek Broadcasting is required to make scheduled aggregate
amortization payments on the Series A and Series B Facilities, as follows:
during the first year after closing, $6.0 million; during the second year after
closing, $11.0 million; during the third year after closing, $14.5 million;
during the fourth year after closing, $16.0 million; during the fifth year after
closing, $27.5 million; during the sixth year after closing, $15.0 million; and
during the first half of the seventh year after closing, $38.0 million.

The credit agreement also includes a Revolving Credit Facility of
$15,000,000, which bears interest at the bank's base rate plus 2.25% or the
Eurodollar rate plus 3.25% per annum. There were no borrowings on the revolver
as of December 31, 1996. The unused portion of the Revolving Credit Facility
bears interest at 0.5% a month.

The credit agreement also contains several mandatory principal prepayment
clauses, one of which Benedek Broadcasting was subject to at December 31, 1996.
This clause stipulated that Benedek Broadcasting prepay the Term Loan Facilities
or must permanently reduce the Revolving Credit Facility for an amount equal to
50% of the Consolidated Excess Cash Flow, as defined by the agreement, no later
than 100 days after the end of the year. Since it is management's intention to
prepay the Term Loan Facilities, Benedek Broadcasting has reflected the
additional $5,122,000 as a current maturity of debt at December 31, 1996 rather
than permanently reducing the Revolving Credit Facility.

The Term Loan Facilities and the Revolving Credit Facility are guaranteed
by the Company and secured by certain of the Company's and Benedek
Broadcasting's present and future property and assets. The Term Loan Facilities
are also guaranteed by BLC and are collateralized by all of the stock of BLC
which is also collateral on the Senior Secured Notes which have an equal
position in the stock of BLC to the Term Loan Facilities. The Term Loan
Facilities contain various restrictive covenants and requires compliance with
certain financial ratios and covenants. Benedek Broadcasting is in compliance
with or has received waivers with respect to certain covenants as of December
31, 1996.

F-17

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On February 28, 1997, Benedek Broadcasting amended the credit agreement as
it relates to certain restrictive covenants and financial ratios through June
30, 1998. As part of the amendment, effective February 28, 1997, Benedek
Broadcasting agreed to increase the interest rate on the Term Loan Facilities
and Revolving Credit Facility by an additional 50 basis points. They also agreed
to reduce the available Revolving Credit Facility from $15,000,000 to
$10,000,000.

(b) Senior Secured Notes. During 1995, Benedek Broadcasting issued
$135,000,000 of 11 7/8% Senior Secured Notes due 2005 (the "Senior Secured
Notes"). The net proceeds of the Senior Secured Notes were used, together with
available cash to (i) refinance certain indebtedness, (ii) finance the
acquisition of WTVY- TV ("the Dothan Station"), and (iii) pay fees and expenses
in connection with the offering. The Senior Secured Notes have been registered
with the Securities and Exchange Commission in a registration statement declared
effective in November 1995.

The Senior Secured Notes bear interest at the rate of 11 7/8% payable
semiannually on March 1 and September 1 of each year and mature in March 2005.
The Senior Secured Notes may be redeemed by Benedek Broadcasting in whole or in
part after March 1, 2000 subject to certain prepayment premiums. The Senior
Secured Notes contain various restrictive covenants relating to prepayment
premiums. The Senior Secured Notes contain various restrictive covenants
relating to limitations on dividends, transactions with affiliates, further
issuance of debt, and the sales of assets, among others. Benedek Broadcasting
was in compliance with these covenants at December 31, 1996.

The Senior Secured Notes are collateralized by all of the stock of BLC,
which is also collateral on the Term Loan Facilities which have an equal
position in the stock of BLC to the Senior Secured. The Senior Secured Notes are
also collateralized by certain agreements and contract rights related to the
Stations which includes network affiliation agreements and certain general
intangibles.

Notes payable consist of the following:
<TABLE>
<CAPTION>
December 31,
------------------------------------------------
1995 1996
---- ----
<S> <C> <C>
Senior secured notes........................ $ 135,000,000 $ 135,000,000
Term loan series A.......................... - 67,500,000
Term loan series B.......................... - 57,500,000
Senior subordinated discount notes-
see (Note F) for terms................... - 97,047,714
Other....................................... 767,025 1,186,562
------------------ ------------------
135,767,025 358,234,276
Less current maturities..................... 318,077 14,015,273
------------------ ------------------
$ 135,448,948 $ 344,219,003
================== ==================
</TABLE>

F-18

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

At December 31, 1996, the notes provide for annual reductions as follows:

Year Ending December 31,
---------------------------------
1997............... $ 14,015,273
1998............... 13,039,371
1999............... 15,447,020
2000............... 21,874,691
2001............... 21,431,722
Thereafter............ 272,426,199
-------------------
$ 358,234,276
===================
(2) INTEREST RATE CAP

The Company entered into an interest rate cap agreement which matures in
May 1998, to reduce the impact of changes in interest rates on its floating-rate
long-term debt. That agreement effectively entitles the Company to receive from
a financial institution the amount, if any, by which the London Interbank
Offering Rate (LIBOR) exceeds 7.36% on a notional amount totaling $125,000,000
subject to an amortization schedule. The $207,000 premium paid for this interest
rate cap is being amortized ratably to interest expense over the 18-month term
of the cap, and is reported as an other asset in the accompanying consolidated
balance sheets. LIBOR at December 31, 1996 was 5.63%.

Although the Company is exposed to credit loss in the event of
nonperformance by the counterparty on the interest rate cap, management does not
expect nonperformance by the counterparty. (Note M) describes the methods and
assumptions used in estimating the fair value of these instruments, and provides
a summary of the carrying amount and fair values of all of the Company's
financial instruments.

(3) GAIN ON EARLY EXTINGUISHMENT OF DEBT

In 1995, the Company recognized an extraordinary gain on early
extinguishment of debt consisting of subordinated capital notes issued in 1986
with detachable stock purchase warrants. The extraordinary gain of approximately
$11,128,000 reduced by losses of approximately $1,140,000 from unrecognized
deferred loan costs, approximately $2,749,000 of prepayment premiums and
contingent payments, and $375,000 of unamortized debt discount, related to the
existing debt.

F-19

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(NOTE H) - PROGRAM BROADCAST RIGHTS PAYABLE

(1) Program broadcast rights and program broadcast rights payable consist of the
following:

<TABLE>
<CAPTION>
Program Program
Broadcast Broadcast
Rights Rights Payable
------------------ --------------------
<S> <C> <C>
Balance at December 31, 1994.................................. $ 1,772,548 $ 2,169,461
Contracts Acquired....................................... 2,651,642 2,637,616
Amortization............................................. (2,161,545) -
Payments................................................. - (2,131,990)
------------------ --------------------
Balance at December 31, 1995.................................. $ 2,262,645 $ 2,675,087
Contracts Acquired....................................... 8,862,457 8,354,793
Amortization............................................. (4,398,905) -
Payments................................................. - (3,317,527)
------------------ --------------------
Balance at December 31, 1996.................................. $ 6,726,197 $ 7,712,353
================== ====================
</TABLE>

(2) The current maturities of program broadcast rights payable consist of the
following:

<TABLE>
<CAPTION>
December 31,
----------------------------------------
1995 1996
---- ----
<S> <C> <C>
Program contracts, due in varying installments
through 2000................................................ $ 2,675,087 $ 7,712,353
Less current maturities....................................... 2,042,643 6,119,953
----------------- ------------
Long-term portion............................................. $ 632,444 $ 1,592,400
================= ============
</TABLE>

F-20

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The maturities of the contracts are as follows:

Year Ending December 31,
----------------------------
1997................ $ 6,119,953
1998................ 1,252,005
1999................ 318,514
2000................ 21,881
----------------
$ 7,712,353
================

In addition, the Company has entered into noncancellable commitments for
future program broadcast rights aggregating approximately $6,616,000 as of
December 31, 1996 with future payments as follows:

Year Ending December 31,
-----------------------------
1997................ $ 1,027,131
1998................ 2,846,417
1999................ 2,100,006
2000................ 642,446
----------------
$ 6,616,000
================

(NOTE I) - ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of the following:

December 31,
---------------------------------------
1995 1996
---- ----
Trade payables.............. $ 379,901 $ 1,364,482
Barter, net................. 292,051 443,012
Compensation and benefits... 1,397,796 4,329,000
Interest.................... 5,343,754 7,239,896
Other....................... 410,794 1,992,191
---------------- -----------------
$ 7,824,296 $15,368,581
================ =================
(NOTE J) - LEASES

The Company leases land, office space and office and transportation
equipment under agreements which expire from 1997 through 2004 and require
various minimum annual rentals. The leases also require payment of the normal
maintenance, real estate taxes and insurance on the properties. The Company has
the option to acquire one of the leased premises on each of May 1, 2000 and 2005
for $650,000 and $750,000, respectively.

F-21

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The approximate total minimum rental commitments at December 31, 1996 under
these leases are due as follows:

Year Ending December 31,
--------------------------------
1997................ $ 903,419
1998................ 593,829
1999................ 462,577
2000................ 386,983
2001................ 300,628
Thereafter............. 651,554
----------------
$ 3,298,990
================

Total rental expense under these agreements and other monthly rentals for
the years ended 1994, 1995 and 1996 was approximately $463,000, $626,000 and
$1,064,000, respectively.

The Company is a lessor of certain portions of its real property to various
organizations. Total rental income under these agreements for the years ended
1994, 1995 and 1996 was approximately $280,000, $324,000 and $680,000,
respectively.

(NOTE K) - INCOME TAX MATTERS AND CHANGE IN TAX STATUS

Prior to the consummation of the acquisitions and the related financing,
Benedek Broadcasting, with the consent of its stockholder, elected to be taxed
under sections of federal and state income tax law, which provided that, in lieu
of corporation income taxes, the stockholder separately accounted for Benedek
Broadcasting's income, deductions, losses and credits. Due to the structure of
the financing for the acquisitions, the election to be taxed as an "S"
Corporation automatically terminated and Benedek Broadcasting became subject to
federal and state income taxes. As a result, Benedek Broadcasting recognized a
net deferred tax asset of approximately $3,550,000. Concurrent with the change
in tax status the accumulated deficit of $41,072,877 which existed on that date
was reclassified to additional paid-in capital.

F-22

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The deferred tax assets and liabilities, resulting primarily from the
acquisitions explained in (Note B) consist of the following components:

December 31,
1996
----
Deferred tax assets:
Loss Carryforwards............... $ 3,769,000
Receivable allowances
and accruals.................. 1,050,000
Network agreements............... 2,057,000
Original issue discount.......... 2,722,000
--------------------
9,598,000
--------------------
Deferred tax liabilities:
Property and equipment........... 14,307,000
Intangibles...................... 48,558,000
--------------------
62,865,000
--------------------
Net deferred tax liability.......... $ (53,267,000)
====================

Had the Company been a taxable entity at December 31, 1995, they would have
recorded a net deferred tax asset of approximately $3,565,000 which would have
been offset by a valuation allowance.

The income tax benefit for 1996 consisted of a deferred tax benefit of
approximately $4,759,000 and $(95,000) of current taxes.

Under the provisions of the Internal Revenue Code, the Company has
approximately $9,422,000 of actual net operating loss carryforwards available to
offset future tax liabilities of the Company, which expire in 2007 through 2011.

F-23

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A reconciliation of the statutory federal income tax rate to the Company's
effective tax rate is as follows:

<TABLE>
<CAPTION>
Years ended December 31,
-----------------------------------------
1994 1995 1996
---- ---- ----
<S> <C> <C> <C>
Computed "expected" income tax
expense (benefit).......................... 35.0% (35.0)% (35.0)%
Increase (decrease) resulting from:
State income taxes, net of federal
effect................................. - - (6.0)
(Income) loss allocated to
stockholder due to "S"
Corporation status..................... (50.4) (36.2) 5.2
Nondeductible amortization and
expenses............................... 15.4 71.2 7.1
Other, net............................... - - 0.8
----------- --------- ----------
Effective tax rate.......................... - - (29.5)%
=========== ========= ==========
</TABLE>

(NOTE L) - PREFERRED STOCK

The Board of Directors of the Company has authorized 2,500,000 shares of
preferred stock of which 1,050,000 was issued in conjunction with the financing
discussed in Note F. The Board has the right and ability to set the terms and
preferences of the preferred stock. The Board has not set the terms and
preferences of the remaining 1,450,000 unissued shares.

(NOTE M) - FAIR VALUE OF FINANCIAL INSTRUMENTS

The estimated fair value of financial instruments has been estimated by the
Company using available market information and appropriate valuation
methodologies as discussed below. Considerable judgment was required, however,
to interpret market data to develop the estimates of fair value. Accordingly,
the estimates presented below are not necessarily indicative of the amounts the
Company could realize in a current market exchange.

Cash and cash equivalents, current receivables, current payables and the
interest rate cap agreement have carrying values which approximate fair value
because of the short-term nature of those instruments. The floating rate
long-term debt carrying amount approximates fair value because the interest rate
fluctuates with the bank's lending rate.

F-24

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table shows the carrying amounts and estimated fair values of
other financial instrument liabilities and other off-balance sheet activities at
December 31, 1995 and 1996:

<TABLE>
<CAPTION>
1995 1996
--------------------------------------- ----------------------------------------
Carrying Estimated Carrying Estimated
Amount Fair Value Amount Fair Value
----------------- ---------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Program broadcast rights
payable............................. $ 2,675,087 $ 2,599,361 $ 7,712,353 $ 7,552,460
Senior subordinated discount
notes............................... - - 97,047,714 97,750,000
Senior secured notes.................. 135,000,000 143,100,000 135,000,000 138,375,000
Seller junior discount preferred
stock................................ - - 47,057,040 31,710,700
Initial warrants...................... - - 7,826,441 2,800,000
</TABLE>

The fair value of program broadcast rights payable was estimated using the
discounted cash flow method.

The fair value of the Senior Subordinated Discount Notes and Senior Secured
Notes was estimated determined using readily available quoted market prices.

The fair value of the Exchangeable Redeemable Senior Preferred Stock
approximates carrying value based upon discounting the contractual cash flows
including the redemption prepayment premium related to the optional redemption
right that the Company intends to exercise, using estimated market discount
rates which reflect the interest rate and other risks inherent in the
instrument.

The fair value of the Seller Junior Discount Preferred Stock is estimated
using discounted cash flow analyses, based on the interest rate, preferences and
other risks inherent in the instrument.

The fair value of the Initial Warrants was estimated as 7.5% of the
multiple of the Broadcast cash flow less interest bearing debt. Broadcast cash
flow is defined as operating income before financial income as derived from
consolidated statements of operations plus depreciation and amortization of
broadcast rights, corporate expenses and noncash compensation less payments for
broadcast rights.

The fair value of the contingent warrants was not estimated because it is
management's intention to redeem the Exchangeable Redeemable Senior Preferred
Stock prior to any release of the Contingent Warrants from escrow.

The above fair value estimates were made at a discrete point in time based
on relevant market information and other assumptions about the financial
instruments. As no active market exists for a significant portion of the
Company's financial instruments, fair value estimates were based on judgments
regarding current economic conditions, future expected cash flows, risk
characteristics and other factors. These estimates are subjective in nature and
involve uncertainties and therefore cannot be calculated with precision. Changes
in assumptions could significantly affect these estimates.

F-25

INDEPENDENT AUDITOR'S REPORT

To the Board of Directors

Benedek Communications Corporation and Subsidiaries
Rockford, Illinois

Our audits were made for the purpose of forming an opinion on the basic
consolidated financial statements taken as a whole. The consolidated
supplemental schedule is presented for purposes of complying with the Securities
and Exchange Commission's rules and are not a part of the basic consolidated
financial statements. These schedules have been subjected to the auditing
procedures applied in our audits of the basic consolidated financial statements
and, in our opinion, are fairly stated in all material respects in relation to
the basic consolidated financial statements taken as a whole.

/s/ McGLADREY & PULLEN, LLP

Rockford, Illinois
February 28, 1997

S-1

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
<TABLE>
<CAPTION>
ADDITIONS
BALANCE AT BALANCES CHARGED TO BALANCE AT
BEGINNING ACQUIRED IN COSTS AND DEDUCTIONS END OF
OF PERIOD ACQUISITIONS EXPENSES DESCRIBED (1) PERIOD
-------------- -------------- ------------- --------------- --------------
<S> <C> <C> <C> <C> <C>
Deducted from asset account --
allowance for doubtful accounts:
Year ended December 31, 1994............ $ 91,778 $ - $ 130,622 $ 122,132 $ 100,268
Year ended December 31, 1995............ 100,268 - 201,382 52,627 249,023
Year ended December 31, 1996............ 249,023 86,458 403,843 255,804 483,519
</TABLE>

- ---------------------------
(1) Uncollectible accounts written off, net of recoveries

S-2

EXHIBIT INDEX

<TABLE>
<CAPTION>
LOCATION OF
EXHIBIT
IN SEQUENTIAL
EXHIBIT NUMBERING
NO. DESCRIPTION SYSTEM
-- ----------- -------
<S> <C> <C>
3.1 -- Certificate of Incorporation of the Registrant, as amended,
incorporated by reference to Exhibit 3.1 to the Registrant's
Registration Statement on Form S-4, File No. 333-09529, filed on
August 2, 1996 (the "S-4 Registration Statement").

3.2 -- By-Laws of the Registrant, incorporated by reference to Exhibit 3.2
to the S-4 Registration Statement.

3.3 -- Certificate of Designation of the Powers, Preferences and Relative,
Participating, Optional and Other Special Rights of 15.0%
Exchangeable Redeemable Senior Preferred Stock Due 2007 and
Qualifications, Limitations and Restrictions thereof, incorporated by
reference to Exhibit 3.3 to the S-4 Registration Statement.

3.4 -- Certificate of Designation, Preferences and Relative, Participating,
Optional and Other Special Rights of Series C Junior Discount
Preferred Stock and Qualifications, Limitations and Restrictions
thereof, incorporated by reference to Exhibit 3.4 to the S-4
Registration Statement.

4.1 -- Indenture dated as of May 15, 1996 between the Registrant and United
States Trust Company of New York, relating to the 13-1/4% Senior
Subordinated Discount Notes due 2006, incorporated by reference to
Exhibit 4.1 to the S-4 Registration Statement.

4.2 -- Form of 13-1/4% Senior Subordinated Discount Note due 2006 (included
in Exhibit 4.1 hereof), incorporated by reference to Exhibit 4.2 to
the S-4 Registration Statement.

4.4 -- Form of 11-7/8% Senior Secured Note due 2005 of Benedek Broadcasting
(included in Exhibit 4.3 hereof), incorporated by reference to
Exhibit 4.4 to the S-4 Registration Statement.

4.5 -- Certificate of Designation of the Powers, Preferences and Relative,
Participating, Optional and Other Special Rights of 15.0%
Exchangeable Redeemable Senior Preferred Stock due 2007 and
Qualifications, Limitations and Restrictions thereof (filed as
Exhibit 3.3 hereof), incorporated by reference to Exhibit 4.5 to the
S-4 Registration Statement.

4.6 -- Certificate of Designation, Preferences and Relative, Participating,
Optional and Other Special Rights of Series C Junior Discount
Preferred Stock and Qualifications, Limitations and Restrictions
thereof (filed as Exhibit 3.4 hereof), incorporated by reference to
Exhibit 4.6 to the S-4 Registration Statement.

4.7 -- Warrant Agreement dated as of June 5, 1996 between the Registrant and
IBJ Schroder Bank & Trust Company with respect to Class A Common
Stock of the Registrant, incorporated by reference to Exhibit 4.7 to
the S-4 Registration Statement.
</TABLE>

EXHIBIT INDEX
<TABLE>
<CAPTION>
LOCATION OF
EXHIBIT
IN SEQUENTIAL
EXHIBIT NUMBERING
NO. DESCRIPTION SYSTEM
-- ----------- -------
<S> <C> <C>
10.1 -- Purchase Agreement dated May 30, 1996 between the Registrant and
Goldman, Sachs & Co., incorporated by reference to Exhibit 10.1 to
the S-4 Registration Statement.

10.2 -- Exchange and Registration Rights Agreement dated May 30, 1996 between
the Registrant and Goldman, Sachs & Co. with respect to the 13-1/4%
Senior Subordinated Discount Notes due 2006 of the Registrant,
incorporated by reference to Exhibit 10.2 to the S-4 Registration
Statement.

10.3 -- Placement Agreement dated June 5, 1996 among the Registrant, Goldman,
Sachs & Co. and BT Securities Corporation, incorporated by reference
to Exhibit 10.3 to the S-4 Registration Statement.

10.4 -- Exchange and Registration Rights Agreement dated June 5, 1996 among
the Registrant, Goldman, Sachs & Co. and BT Securities Corporation
with respect to the 15.0% Exchangeable Redeemable Senior Preferred
Stock due 2007 of the Registrant, incorporated by reference to
Exhibit 10.4 to the S-4 Registration Statement.

10.5 -- Warrant Agreement dated as of June 5, 1996 between the Registrant and
IBJ Schroder Bank & Trust Company (filed as Exhibit 4.7 hereof),
incorporated by reference to Exhibit 10.5 to the S-4 Registration
Statement.

10.6 -- Contingent Warrant Escrow Agreement dated June 5, 1996 between the
Registrant and IBJ Schroder Bank & Trust Company, incorporated by
reference to Exhibit 10.6 to the S-4 Registration Statement.

10.7 -- Common Stock Registration Rights Agreement dated as of June 5, 1996
among the Registrant, Goldman, Sachs & Co. and BT Securities
Corporation, incorporated by reference to Exhibit 10.7 to the S-4
Registration Statement.

10.8 -- Credit Agreement dated as of June 6, 1996 among the Registrant,
Benedek Broadcasting, the Lenders listed therein, Pearl Street L.P.,
Goldman, Sachs & Co. and Canadian Imperial Bank of Commerce, New York
Agency, incorporated by reference to Exhibit 10.8 to the S-4
Registration Statement.

10.9 -- Guaranty dated as of June 6, 1996 by the Registrant in favor of
Canadian Imperial Bank of Commerce, New York Agency, incorporated by
reference to Exhibit 10.9 to the S-4 Registration Statement.

10.10 -- Pledge Agreement dated as of June 6, 1996 between the Registrant and
Canadian Imperial Bank of Commerce, New York Agency, incorporated by
reference to Exhibit 10.10 to the S-4 Registration Statement.

10.11 -- Security Agreement dated as of June 6, 1996 between the Registrant
and Canadian Imperial Bank of Commence, New York Agency, incorporated
by reference to Exhibit 10.11 to the S-4 Registration Statement.

10.12 -- Collateral Account Agreement dated as of June 6, 1996 between the
Registrant and Canadian Imperial Bank of Commerce, New York Agency,
incorporated by reference to Exhibit 10.12 to the S-4 Registration
Statement.

10.13 -- Third Party Account Agreement dated as of June 6, 1996 among the
Registrant, AMCORE Bank, N.A., Rockford and Canadian Imperial Bank of
Commerce,
</TABLE>

EXHIBIT INDEX
<TABLE>
<CAPTION>
LOCATION OF
EXHIBIT
IN SEQUENTIAL
EXHIBIT NUMBERING
NO. DESCRIPTION SYSTEM
-- ----------- -------
<S> <C> <C>
New York Agency, incorporated by reference to Exhibit 10.13 to the
S-4 Registration Statement.

10.14 -- Form of Indemnity Agreement between the Registrant and each of its
executive officers and directors, incorporated by reference to
Exhibit 10.14 to the S-4 Registration Statement.

*10.15 -- Option Agreement dated as of June 6, 1996 between the Registrant and
K. James Yager.

10.16 -- Employment Agreement dated as of June 6, 1996 between the Registrant
and A. Richard Benedek, incorporated by reference to Exhibit 10.16
to the S-4 Registration Statement.

10.17 -- Agreement dated as of June 6, 1996 between the Registrant and K.
James Yager, incorporated by reference to Exhibit 10.17 to the S-4
Registration Statement.

10.18 -- Employment Agreement dated as of June 6, 1996 between the Registrant
and Ronald L. Lindwall, incorporated by reference to Exhibit 10.19 to
the S-4 Registration Statement.

10.19 -- Employment Agreement dated as of June 6, 1996 between the Registrant
and Terrance F. Hurley, incorporated by reference to Exhibit 10.20 to
the S-4 Registration Statement.

10.20 -- Limited Waiver and First Amendment to Credit Agreement dated as of
October 31, 1996 among the Registrant, Benedek Broadcasting
Corporation, Goldman Sachs Credit Partners L.P., the lenders listed
therein and Canadian Imperial Bank of Commerce, New York Agency, as
Administrative Agent, incorporated by reference to Exhibit 10.21 to
the Registrant's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1996.

*10.21 -- Limited Waiver and Second Amendment to Credit Agreement dated as of
February 28, 1997 among the Registrant, Benedek Broadcasting
Corporation, Goldman Sachs Credit Partners L.P., the lenders listed
therein and Canadian Imperial Bank of Commerce, New York Agency, as
Administrative Agent.

*21 -- Subsidiaries of the Company.

*23 -- Consent of McGladrey & Pullen, LLP with respect to the Company.

*27 -- Financial Data Schedule pursuant to Article 5 of Regulation S-X.

<PAGE>

</TABLE>

<PAGE>

AGREEMENT made as of June 6, 1996 by and among K. JAMES YAGER, residing
at 6767 Woodcrest Parkway, Rockford, Illinois 61109 ("Yager"), BENEDEK
COMMUNICATIONS CORPORATION, a Delaware corporation having an office at 308 West
State Street, Rockford, Illinois 61105 (the "Company") and A. RICHARD BENEDEK,
residing at 211 Central Park West, New York, New York ("Benedek").

W I T N E S S E T H:

WHEREAS, the Company has authorized common stock consisting of
25,000,000 shares of Class B Common Stock, par value $.01 per share (the "Class
B Stock"), of which 10,000 shares are issued and outstanding as of the date
hereof and owned by Benedek; and

WHEREAS, the Company has authorized common stock consisting of
25,000,000 shares of Class A Common Stock, par value $.01 per share (the "Class
A Stock"), of which no shares are issued and outstanding as of the date hereof
(the Class A Stock and the Class B Stock are collectively referred to herein as
the "Common Stock"); and

WHEREAS, Benedek Broadcasting Corporation ("BBC"), Yager and Benedek are
parties to two agreements pursuant to which BBC granted to Yager the option to
acquire an aggregate of 7.78 shares of common stock of BBC (the "Existing
Options"); and

WHEREAS, Benedek owns all of the outstanding common stock of BBC and
Benedek intends, contemporaneously with the execution of this Agreement, to
contribute all of such shares to the capital of the Company in exchange for the
issuance to him of 7,030,000 shares of Class B Stock;

WHEREAS, the Company desires to assume the obligations of BBC in repsect
of the Existing Options and, in connection therewith, to issue to Yager options
to acquire 370,000 shares of Class B Stock on the same terms and conditions as,
and in lieu and replacement of, the Existing Options;

WHEREAS, Benedek, Yager and the Company desire to set forth their
understandings and agreements concerning the ownership by of shares of Common
Stock of the Company and their respective rights and obligations with respect
thereto;

NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereto agree as follows:

1. OPTION TO PURCHASE STOCK. Subject to the terms and conditions of this
Agreement, the Company hereby grants to Yager, and Yager hereby accepts,
non-transferable options (the "Options") to purchase (i) 130,784 shares of Class
B Stock (the "First Options") and

<PAGE>

(ii) 239,216 shares of Class B Stock (the "Second Options") (the First Options
and the Second Options are collectively referred to herein as the "Options" and
the shares of Class B Stock issuable upon the exercise of the Options are
referred to herein as the "Option Stock"). The Options may be exercised
immediately as to all of the shares covered thereby. The First Options, to the
extent unexercised, will expire on May 31, 1998 (the "First Expiration Date")
and the Second Options, to the extent unexercised, will expire on May 1, 2004
(the "Second Expiration Date"), unless extended by the Company pursuant to
Section 5 hereof. The Existing Options are hereby terminated and shall be of no
further force or effect.

1.1. The purchase price per share (the "Purchase Price") for the
acquisition by Yager of the Option Stock shall be $1.578939 with respect to the
Initial Options and $4.121797 with respect to the Second Options.

1.2. The Options shall be nontransferable otherwise than by will
or by the laws of descent and distribution and shall be exercisable during
Yager's lifetime solely by him. The Options may be exercised by Yager by written
notice to the Company accompanied by a certified check in the amount of the
Purchase Price multiplied by the number of shares of Option Stock that are the
subject of the notice of exercise. Promptly after receipt of such notice and
payment, the Company shall deliver to Yager certificates evidencing the
appropriate number of shares of Option Stock.

1.3. New options rights may be substituted for the Options or the
Company's duties as to the Options may be assumed, by a corporation other than
the Company, or by a parent or subsidiary of the Company or such corporation, in
connection with any merger, consolidation, acquisition, separation,
reorganization, liquidation or like occurrence in which the Company is involved.
Notwithstanding the foregoing or the provisions of Section 1.4 hereof, in the
event such corporation, or parent or subsidiary of the Company or such
corporation, does not substitute new option rights for, and substantially
equivalent to, the Options or assume the Options, the Options shall terminate
and thereupon become null and void (i) upon dissolution or liquidation of the
Company, or similar occurrence, (ii) upon any merger, consolidation,
acquisition, separation, reorganization, or similar occurrence where the
Company will not be a surviving entity, or (iii) upon a transfer of
substantially all of the assets of the Company or more than 80% of the
outstanding stock; provided, however, that Yager shall have the right
immediately prior to or concurrently with such dissolution, liquidation, merger,
consolidation, acquisition, separation, reorganization or similar occurrence,
to exercise any unexpired Options granted hereunder whether or not then
exercisable.

1.4. The existence of the Options shall not affect in any way the
right or power of the Company or its stockholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issuance of Common Stock or subscription rights thereto, or
any merger or consolidation of the Company, or any issuance of bonds,
debentures, preferred or prior preference stock ahead of or affecting the Common
Stock or the rights thereof, or the dissolution or liquidation of the Company,
or any sale or

<PAGE>

transfer of all or any part of its assets or business, or any other corporate
act or proceeding, whether of a similar character or otherwise; provided,
however, that if the outstanding Common Stock of the Company shall at any time
be changed or exchanged by declaration of a stock dividend, stock split,
combination of shares or recapitalization, the number and kind of shares subject
to the Options and the Purchase Price, shall be appropriately and equitably
adjusted so as to maintain the proportionate number of shares of Common Stock
without changing the aggregate Purchase Price. Adjustments under this Section
shall be made by the Board of Directors of the Company, whose determination as
to what adjustment, if any, shall be made, and the extent thereof, shall be
final.

1.5. The Options shall be subject to the requirement that if at
any time the Board of Directors shall in its discretion determine that the
listing, registration or qualification of shares of Common Stock subject to such
Options upon any securities exchange or under any Federal or state law, or the
approval of consent of any governmental regulatory body, is necessary or
desirable in connection with the issuance or purchase of shares of Common Stock
thereunder, the Options may not be exercised in whole or in part unless such
listing, registration, qualification, approval or consent shall have been
effected or obtained free from any conditions not reasonably acceptable to the
Board of Directors.

1.6. Unless at the time of the exercise of the Options and the
issuance of the shares of Class B Stock thereby purchased there shall be in
effect as to such shares of Class B Stock a registration statement under the
Securities Act of 1933, as amended (the "Act"), and the rules and regulations of
the Securities and Exchange Commission, Yager shall deliver to the Company at
the time of exercise a certificate (i) acknowledging that the shares of Class B
Stock so acquired may be "restricted securities" within the meaning of Rule 144
promulgated under the Act, (ii) certifying that he is acquiring the shares of
Class B Stock issuable to him upon such exercise for the purpose of investment
and not with a view to their sale or distribution; and (iii) containing his
agreement that such shares of Class B Stock may not be sold or otherwise
disposed of except in accordance with applicable provisions of the Act. The
Company shall not be required to issue or deliver certificate for shares of
Class B Stock until there shall have been compliance with all applicable laws,
rules and regulations, including the rules and regulations of the Securities and
Exchange Commission.

1.7. Yager hereby acknowledges that, under existing law, unless
at the time of the exercise of the Options a registration statement under the
Act is in effect as to such shares: (i) any shares purchased by Yager upon
exercise of the Options may be required to be held indefinitely unless such
shares are subsequently registered under the Act or an exemption from such
registration is available; (ii) any sales of such shares made in reliance upon
Rule 144 promulgated under the act may be made only in accordance with the terms
and conditions of that Rule (which, under certain circumstances, restrict the
number of shares which may be sold); (iii) in the case of securities to which
Rule 144 is not applicable, compliance with Regulation A promulgated under the
Act or some other disclosure exemption will be required; (iv) certificates for
shares to be issued to Yager hereunder shall bear a legend to the effect that
the shares have not been registered under the Act and that the shares may not be
sold or otherwise transferred

<PAGE>

in the absence of an effective registration statement under the Act relating
thereto or an exemption from such registration; and (v) the Company will place
an appropriate "stop transfer" order with its transfer agent with respect to
such shares. In addition, Yager hereby acknowledges that the Company has no
obligation to furnish information necessary to enable Yager to make sales under
Rule 144.

1.8. The Company may establish, from time to time, appropriate
procedures to provide for payment or withholding of such income or other taxes
as may be required by law to be paid or withheld in connection with the exercise
of the Options. Yager shall pay the Company all such amounts requested by the
Company to permit the Company to take any deduction available to it resulting
from the exercise of an Option. The Company may also establish, from time to
time, appropriate procedures to ensure that the Company receives prompt advice
concerning the occurrence of any event which may create, or affect the timing or
amount of, any obligation to pay or withhold any such taxes or which may make
available to the Company any tax deduction resulting from the occurrence of such
event, and Yager will comply with all such procedures so established.

1.9. The Company and Benedek represent and warrant to Yager that
(i) Benedek owns 7,030,000 shares of Stock and (ii) there are no issued or
outstanding shares of Common Stock other than the shares owned by Benedek nor
are there any outstanding options, warrants, agreements, rights or commitments
relating to authorized but unissued Common Stock other than (a) warrants to
purchase 600,000 shares of Class A Stock (the "Initial Warrants") issued to the
purchasers of the Company's 15.0% Exchangeable Redeemable Preferred Stock (the
"Redeemable Preferred Stock") and (b) contingent warrants, not presently
outstanding, to purchase 880,000 shares of Class A Stock (the "Contingent
Warrants") issued to the purchasers of the Redeemable Preferred Stock. Whenever
in this Agreement reference is made to the number of outstanding shares of
Common Stock of the Company, such number of outstanding shares shall include the
number of shares of Class A Stock issuable upon exercise of the Initial Warrants
and, if and only if the Contingent Warrants are then deemed outstanding, the
number of shares of Class A Stock issuable upon exercise of the Contingent
Warrants.

2. STOCK CERTIFICATES. All stock certificates representing shares of
Option Stock hereafter acquired by Yager shall be subject to this Agreement and
shall be marked prominently with the following legend:

"The shares of stock evidenced by this certificate or any
certificate issued in exchange or transfer therefor are, and
will be subject to, and may not be transferred except in
accordance with, an agreement dated as of June 6, 1996, by and
among the Company and its stockholders, which agreement
provides, among other things, for certain restrictions on the
transfer, encumbrance and disposition of the shares of stock of
the Company, a copy of which agreement is on file and may be
obtained at the principal office of the Company. The shares of
stock evidenced by this certificate have not been registered
under the Securities Act of 1933 and may not be sold or
otherwise transferred in the absence of an

<PAGE>

effective registration statement under such Act relating thereto
or an exemption from such registration."

3. RESTRICTIONS ON SALES OR TRANSFERS OF SHARES OF OPTION STOCK. Yager
may not sell, assign, transfer, hypothecate, mortgage, pledge, encumber or
otherwise dispose of any shares of Option Stock at any time owned by him, except
has follows:

3.1. If Yager shall receive a bona fide offer (the "Bona Fide
Offer"), in writing, from a third party in respect of the sale of all of the
shares of Option Stock then owned by Yager (such Option Stock being hereinafter
referred to as the "Offered Stock"), which offer Yager desires to accept, the
following provisions shall be applicable:

3.1.1. Yager shall first offer to sell all of the Offered
Stock to the Company upon the same terms as are contained in the Bona Fide
Offer. The offer shall be in writing and accompanied by a true copy of the Bona
Fide Offer.

3.1.2. The Company shall have the right, but not the
obligation, to accept such offer by written notice of acceptance to Yager within
30 days after receipt of such offer. In the event that the Company does not
accept the offer, then Yager shall be free to accept the Bona Fide Offer
originally made by the third party with respect to all, but not less than all,
of the Offered Stock and all of the restrictions imposed by this Agreement upon
the Offered Stock shall forthwith terminate; provided, however, if all of the
Offered Stock is not disposed of to the third party making such offer upon the
terms set forth therein within a period of 60 days after the expiration of the
offer made by Yager to the Company pursuant to Section 3.1.1 above, then all of
such Offered Stock shall again be subject to all of the restrictions set forth
in this Agreement.

3.1.3. Payment of the purchase price for any Offered Stock
purchased by the Company in accordance with the provisions of this Paragraph
3.1 shall be made at a closing to be held at the offices of the attorneys for
the Company on a date selected by the Company which shall be not later than 45
days after the acceptance by the Company of any offer made pursuant to Section
3.1 above. At the closing, (i) the Company shall pay the purchase price for
the Offered Stock in full in cash or by bank cashier's check and (ii) Yager
shall deliver all certificates representing the Offered Stock to the Company,
free and clear of all liens, claims and encumbrances, duly endorsed in blank
for transfer or with duly executed stock powers attached, with all necessary
transfer tax stamps affixed thereto to the purchaser.

3.2. Yager may, and at the request of the Company if Benedek
shall have entered into a similar arrangement with respect to the shares of
Common Stock owned by him Yager shall, pledge any and all shares of Option Stock
from time to time owned by him as collateral security for the obligations of the
Company or any of its subsidiaries to institutional lenders providing secured
financing for the Company. In such event, Yager shall execute such pledge
agreement and related documents as may be reasonably requested by such lenders.

<PAGE>

4. TAKE-ALONG AND COME-ALONG RIGHTS.

4.1. Prior to the sale by the Company of shares of Common Stock
to the public in a public offering registered with the Securities and Exchange
Commission pursuant to a registration statement on Forms S-1, S-2, S-3 or S-4 or
any successor from thereto (a "Registration Statement"), whenever Benedek shall
receive a bona fide offer from a third party to purchase shares of Stock
beneficially owned by Benedek constituting more than 50% of the outstanding
shares of Common Stock of the Company and which offer he wishes to accept,
Benedek shall give written notice to Yager to such effect, enclosing a copy of
such offer and specifying the number of shares of Common Stock to which such
offer relates, the name of the person or persons to whom such sale is to be made
and the dollar value of the consideration which has been offered in connection
therewith.

4.2. Upon receipt of such notice, Yager shall have the right,
exercisable by written notice to Benedek within 15 days after the receipt of
notice from Benedek, to require that Benedek arrange for the sale of a
proportionate portion of Yager's holdings of shares of Common Stock to the
prospective purchaser on the terms and conditions set out in the offer received
by Benedek.

4.3. Benedek shall have the right, exercisable at any time during
the term of this Agreement, to require that Yager sell all of the shares of
Common Stock then owned by him to any bona fide purchaser to whom Benedek
intends to sell shares of Common Stock constituting at least 50% of the
outstanding Common Stock of the Company, such sale by Yager to be on the same
terms and conditions as the sale by Benedek. Benedek may exercise the right
described herein by giving 15 days' written notice to Yager.

5. PUT OPTION. Subject to the rights of the Company under this Section
5, the Company hereby grants to Yager the option, right and privilege (the
"Right to Put"), exercisable by written notice, in the case of the First
Options, during the one-year period prior to the First Expiration Date, and in
the case of the Second Options, during the one-year period prior to the Second
Expiration Date, to require the Company to purchase from Yager the then
unexercised First Options or Second Options, as the case may be (the Options
in respect of which such notice is given is referred to in this Section 5 as the
"Subject Options"), for a purchase price equal to the Formula Price (as
hereinafter defined), provided (i) Yager is then employed by the Company or
his employment by the Company was terminated prior thereto by reason of his
death or disability while employed by the Company and (ii) the Common Stock
of the Company is not then registered pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended.

5.1. The Company shall elect, by written notice to Yager within
90 days after receipt of notice from Yager of his exercise of the Right to Put,
to (i) purchase the Subject Options for the Formula Price, (ii) lend to Yager
the Purchase Price for the Option Stock issuable pursuant to the Subject Options
plus the amount necessary to pay any Federal and state income tax due upon and
by reason of the exercise by Yager of the Subject Options (in which event Yager
shall be deemed to have exercised the Subject Options), or (iii) extend the

<PAGE>

Expiration Date of the Subject Options. If the Company does not make such
election within such 90-day period, the Company shall be deemed to have elected
to extend the Expiration Date of the Subject Options for a period of five years.

5.2. In the event that the Company elects to purchase the Subject
Options, payment of the Formula Price shall be made at a closing to be held at
the offices of attorneys for the Company on a date selected by the Company
within 30 days after the expiration of the 90-day period described in Section
5.1. At the closing, the purchase price for the Subject Options shall be paid in
full in cash or by bank cashier's check. At the closing, Yager shall execute and
deliver an instrument satisfactory to the Company cancelling and terminating the
Subject Options. Certain capitalized terms used in this Section 5 have the
meanings ascribed thereto in those certain Warrant Agreements dated as of
December 18, 1986, as subsequently amended (the "Warrant Agreement"), between
BBC and the then holders of its Series A Capital Notes, which Capital Notes and
related warrants were redeemed by BBC.

5.2.1. The term "Formula Price" means the (i) Value of the
Company multiplied by the Applicable Ratio, minus the (ii) Purchase Price
multiplied by the number of shares of Option Stock which are the subject of the
Subject Options to be purchased by the Company.

5.2.2. For purposes of Section 5.2.1, the following terms
shall have the meanings set forth below:

5.2.2.1. The term "Applicable Ratio" means (i) the
number of shares of Option Stock which are the subject of the Subject Options to
be purchased by the Company, divided by (ii) the sum of the number of
outstanding shares of Common Stock and the number of shares of Common Stock that
would be outstanding if all of the then unexercised Options were exercised.

5.2.2.2. The term "Consolidated Current Assets" is
defined in the Warrant Agreements.

5.2.2.3. The term "Consolidated Liabilities" is
defined in the Warrant Agreements.

5.2.2.4. The term "Consolidated Operating Profit"
is defined in the Warrant Agreements.

5.2.2.5. The term "Investments" is defined in the
Warrant Agreements.

5.2.2.6. The term "Operating Asset Value" means the
Consolidated Operating Profit of the Company for the four fiscal quarters most
recently ended prior to the time of determination of such Operating Asset Value.

<PAGE>

5.2.2.7. The term "Value" means (i) the Operating
Asset Value of the Company at such time, plus (ii) the aggregate amount of
Consolidated Current Assets and Investments as of the last day of the then most
recently ended fiscal quarter of the Company, minus (iii) the Consolidated
Liabilities as of the end of such quarter.

5.3. In the event that the Company elects to lend Yager the
amount necessary to pay any Federal and state income taxes due upon the exercise
of the Subject Options, the Company shall lend such amount to Yager upon 30
days' written notice from Yager, such notice by Yager to be given after the
exercise of the Subject Options and no earlier than 45 days prior to the date
such taxes are due and payable. The notice by Yager pursuant to this Section 5.3
shall be accompanied by a (i) promissory note in form and substance satisfactory
to the Company duly executed by Yager, in the principal amount of the loan to be
made by the Company and providing for repayment of the principal amount thereof
in quarterly installments over a period of three years with interest, payable
quarterly, at fluctuating rate per annum equal to the prime rate as published
from time to time in The Wall Street Journal, and (ii) a pledge agreement in
form and substance satisfactory to the Company duly executed by Yager pursuant
to which Yager shall grant the Company a security interest in the Option Stock
issuable pursuant to the Subject Options as security for the amounts due under
the promissory note.

5.4. In the event that the Company elects to extend the
Expiration Date of the First Options or Second Options, the Company shall
include in its notice to Yager pursuant to Section 5.2 a new expiration date for
such Options which new expiration date shall be at least five years after the
Expiration Date for such Options. The provisions of this Section 5 shall apply
during the last year of exerciseability of the Options as extended or as deemed
to be extended by the Company and Yager may exercise the Right to Put during
such year, in which the event the Company may make any election permitted under
Section 5.2.

6. REGISTRATION RIGHTS. Yager shall have the registration rights set
forth in this Section with respect to shares of Class B Stock of the Company
acquired upon exercise of the Options.

6.1. For purposes of this section "Restricted Stock" shall mean
shares of Common Stock issued upon exercise of the Options that have not
theretofore been registered under the Act, or theretofore remained unsold while
registered under said Act.

6.2. If at any time or times, the Company proposes to file one or
more Registration Statements for the registration under the Act of shares of
Common Stock owned by Benedek, whether or not underwritten, the Company shall
give a Notice of Registration (as defined in Section 6.2.4 hereof) to Yager, and
shall include in each Registration Statement referred to in such notice all
Restricted Stock with respect to which Yager shall have delivered to the Company
a Notice of Intent to Sell (as defined in Section 6.2.3 hereof) within 30 days
after the Company has given its Notice of Registration. Such Notice of
Registration shall be given not later than 45 days prior to the filing of any
such Registration Statement. All expenses incurred by the Company and Yager in
complying with all registration requirements, including

<PAGE>

without limitation filing fees, fees and disbursements of counsel for the
Company and printing and other expenses (but excluding any underwriting
discounts or commissions) in connection with each such registration shall be
borne by the Company. The Company shall have no obligation to register the
Restricted Stock under this Section 6, however, unless Yager agrees to join in
underwriting arrangements which are, except as otherwise herein provided, on the
same terms as other participants in the distribution, including, if the
underwriters or their representative or representatives shall determine,
reasonably and in good faith that the number of shares of Common Stock to be
included on any such Registration Statement exceeds the number of shares which
can be offered and sold on reasonable terms and price under prevailing market
conditions, a reduction in the number of shares of Restricted Stock to be
included in such Registration Statement to allow the orderly offering and sale
under prevailing market conditions by the Company of all shares of Common Stock
it is requesting to be registered, provided, however, that if shares of Stock
held by persons other than Benedek and Yager are included in the shares covered
by such Registration Statement, such reduction shall be proportionate to the
reduction in the number of shares of Common Stock of the Company which such
other persons are required to make by said underwriters.

6.2.1. The Company shall not be required to maintain the
effectiveness of any Registration Statement filed in connection with the
registration which is the subject of this Section 6 or to amend such
Registration Statement or to supplement the prospectus relating thereto after
the expiration of nine months from the effective date of such Registration
Statement.

6.2.2. The Company need not include any Restricted Stock
owned by Yager in any Registration Statement provided for under this Section 6
if, in the opinion of counsel for the Company, registration of such shares under
the Act is not necessary to dispose of such shares in a public offering and
distribution in the open market in compliance with the Act; provided in such
case, the opinion of such counsel shall be in writing addressed to Yager and
shall be rendered within 20 days after the Notice of Intent to Sell is received
by the Company, and provided further that if the Company declines to register
any Restricted Stock pursuant to this Section 6.2.2, the Company shall
indemnify against any and all losses, damages, liabilities and expenses,
including counsel fees and liability under the Act, that may incur as a result
of any sale made in reliance upon the aforementioned opinion.

6.2.3. "Notice of Intent to Sell" shall mean a written
notice signed by Yager (i) setting forth the number of shares of Restricted
Stock, if any, which Yager desires to have registered for sale which number of
shares may not exceed that proportion of the shares of Restricted Stock as
equals the proportion of shares of Common Stock owned by Benedek to be included
in the applicable Registration Statement, (ii) representing that Yager has a
present intention to sell the same, and (iii) agreeing to execute all consents,
Registration Statements and other documents reasonably required in order to
permit the applicable Registration Statement to be made effective and to carry
out the distribution.

<PAGE>

6.2.4. "Notice of Registration" shall mean a written
notice signed by an officer of the Company, setting forth the approximate date
on which it intends to file a Registration Statement for the registration of
Common Stock pursuant to the Act, and the approximate date on which it
contemplates such Registration Statement will become effective.

6.2.5. The obligation of the Company to register
Restricted Stock for Yager pursuant to Section 6 hereof shall be subject to the
receipt by the Company of an agreement from Yager, and the underwriter of any
Restricted Stock to be registered for Yager, in form and substance satisfactory
to the Company, indemnifying the Company against liability arising out of or
based upon any untrue statement or alleged untrue statement of material fact in
the Registration Statement, or the omission or alleged omission to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, if (with respect to the agreement of Yager)
such statement or omission was made by the Company in reliance upon and in
conformity with written information furnished to the Company specifically for
use in such Registration Statement by or on behalf of Yager, or (with respect to
the agreement of any underwriter of any Restricted Stock to be registered for
Yager) by or on behalf of the underwriter. In connection with the registration
under the Act of the Restricted Stock owned by Yager, the Company hereby agrees
to indemnify Yager and each underwriter thereof against liability arising out of
or based upon an untrue statement or alleged untrue statement of a material fact
in a Registration Statement or the omission of any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, other than any such statement included in, or omitted from, such
Registration Statement by the Company in reliance upon and in conformity with
written information unfurnished to the company, specified for use therein, by or
on behalf of Yager (with respect to Yager), or by or on behalf of any
underwriter of the securities included therein (with respect to such
underwriter). The Company and Yager agree to join in an underwriting agreement
having usual and customary terms, including customary representations,
warranties and other agreements (other than agreements with respect to
indemnification which shall be similar to those provided in this Section 6.2.5);
provided that no such agreement shall require Yager to make any representation
or warranty concerning the Company unless the same be based upon the actual
knowledge of Yager. Reasonably promptly (but not more than 30 days) after
receipt from a party claiming indemnification under this Section 6.2.5 of notice
of commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this Section
6.2.5, notify in writing the indemnifying party of the commencement thereof; and
the omission to notify the indemnifying party will relieve it from any liability
under this Section 6.2.5 as to the particular item for which indemnification
is then being sought, but not from any other liability which it may have to
any indemnified party. In case any such action is brought against any
indemnified party, and the indemnified party notifies an indemnifying party of
the commencement thereof, the indemnifying party will be entitled to
participate therein and to the extent that it may wish, to assume the defense
thereof, with counsel who shall be to the reasonable satisfaction of such
indemnified party, and after receipt of actual notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party will not be liable to such indemnified party
under this Section 6.2.5 for any legal or other expenses subsequently incurred
by such indemnified party in connection with

<PAGE>

the defense thereof; provided, however, that the indemnified party shall have
the right to employ separate counsel to represent it in connection with any
claim in respect of which indemnity may be sought hereunder if, in the
reasonable judgment of counsel for the indemnified party, a conflict of interest
exists making it advisable for him to be represented by separate counsel, in
which event the fees and expenses of such separate counsel shall be borne by the
indemnifying party. An indemnifying party shall not be liable to any indemnified
party on account of any settlement of any claim or action effected without the
consent of such indemnifying party.

6.2.6. In the event the Company shall at any time fail to
perform fully and completely its obligations under this Section 6, then Yager
shall, in addition to all other rights or remedies hereunder, at all or in
equity, have the right to petition any court with jurisdiction in the premises
for an order compelling the Company specifically to perform said obligations, it
being recognized that monetary damages are not adequate compensation for any
such failure.

7. TERMINATION.

7.1. This Agreement shall commence upon the date hereof and shall
terminate upon the occurrence of any of the following events:

7.1.1. The written agreement of the Company, Yager and
Benedek;

7.1.2. The sale of all or substantially all of the assets
of the Company; or

7.1.3. The acquisition by the Company of all of the Option
Stock or all of the Options from Yager in accordance with the terms of this
Agreement or the sale of all of the Option Stock to a third party in accordance
with this Agreement.

7.2. No termination of this Agreement shall affect any provision
hereof which by its terms is to be performed or observed after its termination,
and each such provision hereof shall remain in full force and effect until such
time as such provision has been performed in full or has terminated by its own
terms.

8. CONFIDENTIAL INFORMATION. Yager shall hold in a fiduciary capacity
for the benefit of the Company all information, knowledge and data relating to
or concerned with its operations, sales, business and affairs, and he shall not,
at any time hereafter, use, disclose or divulge any such information, knowledge
or data to any person, firm or corporation other than to the Company or its
designees or except as may otherwise be required in connection with the business
and affairs of the Company.

9. NOTICES. All notices, including notices of offer, acceptance and
rejection which any party hereto is required or desires to send to another
party, shall be delivered in person, or mailed by prepaid certified or
registered mail, or sent by express mail service for next day delivery or other
responsible overnight delivery service to the party at its address set forth
below or at such address as may be designated by notice in accordance with this
Section 9.

<PAGE>

If to Yager:
6767 Woodcrest Parkway
Rockford, Illinois 61109

If to the Company or Benedek:

308 West State Street
Rockford, Illinois 611

with copies to:

Shack & Siegel, P.C.
530 Fifth Avenue
16th Floor
New York, New York 10036
Attention: Paul S. Goodman, Esq.

Any such notice shall be deemed to have been given and received on the day it is
personally delivered or, if mailed, on the third day after it is mailed, or, if
sent by express mail or overnight delivery service, on the next business day
after the date of the delivery of the notice to such service.

10. BENEFITS. This Agreement shall inure to the benefit of and shall be
binding upon the respective heirs, personal representatives, successors and
assigns of the parties hereto.

11. INJUNCTIVE RELIEF. In the event of a breach or threatened breach by
any party bound by this Agreement of any of such party's obligations hereunder,
the parties hereto acknowledge that all other parties bound by this Agreement
will have no adequate remedy at law and shall be entitled to such equitable and
injunctive relief as may be available to restrain a violation or threatened
violation of the provisions of this Agreement or to enforce the provisions
hereof. Nothing herein shall be deemed to preclude any party from pursuing any
other remedies, legal or equitable, available to such party for such breach or
threatened breach, including the recovery of damages.

12. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings among the parties or any of them. There are
no representations, warranties, agreements or understandings other than
expressly contained herein. No termination, alteration, modification, variation
or waiver of this agreement or any of the provisions hereof shall be effective
unless in writing. Nothing contained in this Agreement shall be construed as an
employment contract or an agreement by the Company to employ Yager for any
period of time.

<PAGE>

13. SEVERABILITY. Should any clause, paragraph or part of this Agreement
be held or declared to be void or illegal for any reason, all other clauses,
paragraphs or parts of this agreement which can be effected without such illegal
clause, paragraph or part shall nevertheless remain in full force and effect.
If, in the opinion of any court, any clause, paragraph or part of this Agreement
is unreasonable or unenforceable, such court shall have the right, power and
authority to excise or modify such provisions, or portions thereof, of this
Agreement as to the court shall not be reasonable or enforceable and to enforce
the remainder of such clause, paragraph or part as so excised or modified.

14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements
executed and to be performed entirely therein and each party hereto, by their
execution of this Agreement, hereby consents to the personal jurisdiction of the
courts of the State of New York and the Federal courts located within such State
in connection with any dispute arising under or related to this Agreement and
further agrees that service of process in any such action may be made by
certified mail to the address set forth herein.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

s/K. James Yager
__________________________________________
K. JAMES YAGER

s/ A. Richard Benedek
__________________________________________
A. RICHARD BENDEK

BENEDEK COMMUNICATIONS CORPORATION

By: s/ A. Richard Benedek
________________________________________

<PAGE>

EXECUTION

BENEDEK BROADCASTING CORPORATION
BENEDEK COMMUNICATIONS CORPORATION

LIMITED WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT

This LIMITED WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT (this
"WAIVER AND AMENDMENT") is dated as of February 28, 1997, and entered into by
and among Benedek Broadcasting Corporation, a Delaware corporation ("COMPANY"),
Benedek Communications Corporation, a Delaware corporation ("BCC"), Goldman
Sachs Credit Partners L.P. (as successor to Pearl Street L.P.; "GSCP") and the
other financial institutions listed on the signature pages hereof ("LENDERS"),
and Canadian Imperial Bank of Commerce, New York Agency ("CIBC-NYA"), as
Administrative Agent, and for purposes of Section 11 hereof, Benedek License
Corporation, a Delaware corporation ("LICENSE SUB"), and is made with reference
to that certain Credit Agreement dated as of June 6, 1996, as amended by that
certain Limited Waiver and First Amendment to Credit Agreement, dated as of
October 31, 1996 (the "CREDIT AGREEMENT"), by and among Company, BCC, Lenders,
GSCP, as Arranging Agent, Goldman, Sachs & Co., as Syndication Agent, and
CIBC-NYA, as Administrative Agent and Collateral Agent. Capitalized terms used
herein without definition shall have the same meanings herein as set forth in
the Credit Agreement.

RECITALS

WHEREAS, BCC and Company have requested Lenders to waive compliance with
certain financial covenants in the Credit Agreement and Lenders desire to grant
such waiver; and

WHEREAS, BCC, Company and Lenders desire to amend certain provisions of
the Credit Agreement;

NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

SECTION 1. WAIVER

Subject to the terms and conditions set forth herein and in reliance on
the representations and warranties of BCC and Company herein contained, Lenders
hereby waive compliance with certain provisions of subsection 6.6 of the Credit
Agreement as follows:

<PAGE>

(A) MINIMUM CASH INTEREST COVERAGE RATIO. Lenders hereby waive
compliance with the provisions of subsection 6.6A with respect to the
Minimum Cash Interest Ratio required for the four Fiscal Quarter period
ended December 31, 1996; provided that the Cash Interest Coverage Ratio
for such four Fiscal Quarter period is not less than 1.62:1.00.

(B) MAXIMUM LEVERAGE RATIO. Lenders hereby waive compliance with
the provisions of subsection 6.6C with respect to the Maximum Leverage
Ratio permitted as of the last day of the Fiscal Quarter ended December
31, 1996; provided that the Leverage Ratio as of such date is not
greater than 7.70:1.00.

(C) MAXIMUM CREDIT FACILITIES LEVERAGE RATIO. Lenders hereby
waive compliance with the provisions of subsection 6.6D with respect to
the Maximum Credit Facilities Leverage Ratio permitted as of the last
day of the Fiscal Quarter ended December 31, 1996; provided that the
Credit Facilities Leverage Ratio as of such date is not greater than
2.69:1.00.

(D) MINIMUM CONSOLIDATED ADJUSTED EBITDA. Lenders hereby waive
compliance with the provisions of subsection 6.6F with respect to the
Minimum Consolidated Adjusted EBITDA required for the Fiscal Year 1996;
provided that Consolidated Adjusted EBITDA for such Fiscal Year is not
less than $46,500,000.

SECTION 2. LIMITATION OF WAIVER

Without limiting the generality of the provisions of subsection 9.6 of
the Credit Agreement, the waiver set forth above shall be limited precisely as
written and relates solely to the noncompliance by BCC and Company with the
provisions of subsections 6.6A, 6.6C, 6.6D and 6.6F of the Credit Agreement in
the manner and to the extent described above, and nothing in this Waiver and
Amendment shall be deemed to:

(A) constitute a waiver of compliance by BCC or Company with
respect to (i) subsection 6.6 of the Credit Agreement in any other
instance or (ii) any other term, provision or condition of the Credit
Agreement or any other instrument or agreement referred to therein; or

(B) prejudice any right or remedy that Agents or any Lender may
now have (except to the extent such right or remedy was based upon
existing defaults that will not exist after giving effect to this Waiver
and Amendment) or may have in the future under or in connection with the
Credit Agreement or any other instrument or agreement referred to
therein.

Except as expressly set forth herein, the terms, provisions and
conditions of the Credit Agreement and the other Loan Documents shall remain in
full force and effect and in all other respects are hereby ratified and
confirmed.

<PAGE>

SECTION 3. AMENDMENTS TO CREDIT AGREEMENT

3.1 AMENDMENTS TO SUBSECTION 1.1. Subsection 1.1 of the Credit Agreement
is hereby amended by deleting the definitions of "Applicable Margin" and
"Pricing Reduction" in their entirety and substituting the following therefor:

" `APPLICABLE MARGIN' means, for each AXEL Series A, AXEL Series B and
Revolving Loan, as of any date of determination, a percentage per annum
as set forth below less the Pricing Reduction, if any:

<TABLE>
<CAPTION>
==========================================================================================
AXELS SERIES A AXELS SERIES B REVOLVING LOANS
- ------------------------------------------------------------------------------------------
BASE RATE EURODOLLAR BASE RATE EURODOLLAR BASE RATE EURODOLLAR
LOANS RATE LOANS LOANS RATE LOANS LOANS RATE LOANS
==========================================================================================
<S> <C> <C> <C> <C> <C>
2.75% 3.75% 3.25% 4.25% 2.75% 3.75%
==========================================================================================

</TABLE>

Any change in the Applicable Margin resulting from a Pricing Reduction
or any change in the Pricing Reduction shall become effective on the day
following delivery of the relevant Compliance Certificate to
Administrative Agent and Lenders and shall remain in effect through the
next scheduled date for delivery of a Compliance Certificate.

`PRICING REDUCTION' means (i) if at any time the Leverage Ratio
as of the end of any Fiscal Quarter is less than 6.75:1.00, a pricing
reduction equal to 0.75%; and (ii) if at any time the Leverage Ratio as
of the end of any Fiscal Quarter is equal to or less than 5.75:1.00, a
pricing reduction equal to 1.00%. The Pricing Reduction shall be
determined by reference to the Leverage Ratio set forth in the most
recent financial statements delivered by Company to Administrative Agent
and Lenders pursuant to clauses (ii) or (iii) of subsection 5.1
(accompanied by a Compliance Certificate delivered by Company pursuant
to clause (iv) of subsection 5.1). It is understood and agreed that the
Pricing Reduction set forth in clause (i) and the Pricing Reduction set
forth in clause (ii) of this definition are not cumulative.
Notwithstanding anything herein to the contrary, at any time an Event of
Default shall have occurred and be continuing, the Pricing Reduction
shall be zero."

3.2 AMENDMENT TO SUBSECTION 2.1. Subsection 2.1A(iii) of the Credit
Agreement is hereby amended by deleting the second sentence thereof and
substituting the following therefor:

"The amount of each Lender's Revolving Loan Commitment is set
forth opposite its name on Schedule 2.1 annexed hereto and the aggregate
amount of the Revolving Loan Commitments is $10,000,000; provided that
the Revolving Loan Commitments of Lenders shall be adjusted to give
effect to any assignments of the Revolving Loan Commitments pursuant to
subsection 9.1B; and provided, further that the amount of the Revolving
Loan Commitments shall be reduced from time to time by the amount of any
reductions thereto made pursuant to subsections 2.4B(ii) and 2.4B(iii)."

<PAGE>

3.3 AMENDMENT TO SUBSECTION 2.4. Subsection 2.4B(iii)(e) of the Credit
Agreement is hereby amended to read in its entirety as follows:

"(e) Prepayments and Reductions from Consolidated Excess Cash
Flow. In the event that there shall be Consolidated Excess Cash Flow for
any Fiscal Year (commencing with Fiscal Year 1996, provided that
Consolidated Excess Cash Flow for Fiscal Year 1996 shall be calculated
with respect to the last two Fiscal Quarters of 1996 only), Company
shall, no later than 100 days after the end of such Fiscal Year, prepay
the Loans and/or the Revolving Loan Commitments shall be permanently
reduced in an aggregate amount equal to (1) with respect to Fiscal Year
1996, 50% of such Consolidated Excess Cash Flow, and (2) with respect to
Fiscal Year 1997 and each Fiscal Year thereafter, 75% of such
Consolidated Excess Cash Flow if the Leverage Ratio as of the last day
of such Fiscal Year is greater than 6.75:1 and 50% of such Consolidated
Excess Cash Flow if the Leverage Ratio as of the last day of such Fiscal
Year is less than or equal to 6.75:1."

3.4 AMENDMENT TO SUBSECTION 6.1. Subsection 6.1(viii) of the Credit
Agreement is hereby amended by amending clause (c)(1) thereof to read in its
entirety as follows:

"(1) $5,000,000 at any time until the Leverage Ratio is less than
or equal to 5.75:1,"

3.5 AMENDMENTS TO SUBSECTION 6.6.

(A) MINIMUM CASH INTEREST COVERAGE RATIO. Subsection 6.6A of the
Credit Agreement is hereby amended by deleting the table contained
therein and substituting the following table therefor:

<PAGE>

"
==================================================================
MINIMUM
PERIOD CASH INTEREST
COVERAGE RATIO
==================================================================
<S> <C>
10/01/96 through 12/31/96 1.90:1
- ------------------------------------------------------------------
01/01/97 through 03/31/98 1.50:1
- ------------------------------------------------------------------
04/01/98 through 06/30/98 1.75:1
- ------------------------------------------------------------------
07/01/98 through 09/30/98 2.00:1
- ------------------------------------------------------------------
10/01/98 through 09/30/99 2.15:1
- ------------------------------------------------------------------
10/01/99 through 09/30/2000 2.40:1
- ------------------------------------------------------------------
10/01/2000 through 09/30/01 2.80:1
- ------------------------------------------------------------------
Thereafter 2.00:1
==================================================================
"

</TABLE>

(B) MINIMUM FIXED CHARGE COVERAGE RATIO. Subsection 6.6B of the
Credit Agreement is hereby to read in its entirety as follows:

"MINIMUM FIXED CHARGE COVERAGE RATIO. BCC and Company
shall not permit the Fixed Charge Coverage Ratio (i) as of
December 31, 1996 for the two consecutive Fiscal Quarters then
ended to be less than 1.15:1, (ii) as of March 31, 1997 for the
three Fiscal Quarter period then ended to be less than 1.10:1 and
(iii) as of the last day of any Fiscal Quarter ending during any
of the periods set forth below for the four Fiscal Quarter
periods then ended to be less than the correlative ratio
indicated:

"
====================================================================
PERIOD MINIMUM FIXED CHARGE
COVERAGE RATIO
====================================================================
<S> <C>
04/01/97 through 06/30/97 1.05:1
- --------------------------------------------------------------------
07/01/97 through 03/31/98 0.95:1
- --------------------------------------------------------------------
04/01/98 through 06/30/98 1.00:1
- --------------------------------------------------------------------
Thereafter 1.15:1
====================================================================
"

</TABLE>

<PAGE>

(C) MAXIMUM LEVERAGE RATIO. Subsection 6.6C of the Credit
Agreement is hereby amended by deleting the table contained therein and
substituting the following table therefor:

"
==================================================================
MAXIMUM
PERIOD LEVERAGE RATIO
==================================================================
<S> <C>
10/01/96 through 12/31/96 6.75:1
- ------------------------------------------------------------------
01/01/97 through 12/31/97 8.00:1
- ------------------------------------------------------------------
01/01/98 through 03/31/98 7.60:1
- ------------------------------------------------------------------
04/01/98 through 06/30/98 7.20:1
- ------------------------------------------------------------------
07/01/98 through 09/30/98 6.50:1
- ------------------------------------------------------------------
10/01/98 through 09/30/2000 5.75:1
- ------------------------------------------------------------------
10/01/2000 through 09/30/01 5.00:1
- ------------------------------------------------------------------
Thereafter 4.75:1
==================================================================
"

</TABLE>

(D) MAXIMUM CREDIT FACILITIES LEVERAGE RATIO. Subsection 6.6D of
the Credit Agreement is hereby amended by deleting the table contained
therein and substituting the following table therefor:

<PAGE>

"
==================================================================
MAXIMUM CREDIT
PERIOD FACILITIES
LEVERAGE RATIO
==================================================================
<S> <C>
07/01/96 through 12/31/96 2.45:1
- ------------------------------------------------------------------
01/01/97 through 12/31/97 2.75:1
- ------------------------------------------------------------------
01/01/98 through 03/31/98 2.50:1
- ------------------------------------------------------------------
04/01/98 through 06/30/98 2.20:1
- ------------------------------------------------------------------
10/01/98 through 09/30/99 1.95:1
- ------------------------------------------------------------------
10/01/99 through 09/30/2000 1.45:1
- ------------------------------------------------------------------
10/01/2000 through 09/30/01 0.85:1
- ------------------------------------------------------------------
Thereafter 0.50:1
==================================================================

</TABLE>

(E) MINIMUM CONSOLIDATED ADJUSTED EBITDA. Subsection 6.6F of the
Credit Agreement is hereby amended by deleting the table contained
therein and substituting the following table therefor:

============================================================
MINIMUM
FISCAL CONSOLIDATED ADJUSTED
YEAR EBITDA
============================================================
<S> <C>
1996 $53,000,000
- ------------------------------------------------------------
1997 $45,000,000
- ------------------------------------------------------------
1998 $60,000,000
- ------------------------------------------------------------
1999 and each
year thereafter $62,000,000
============================================================

</TABLE>

SECTION 4. CONDITIONS TO EFFECTIVENESS

Notwithstanding anything to the contrary herein, this Waiver and
Amendment shall become effective only upon the satisfaction of the following
conditions precedent (the date of satisfaction of such conditions being referred
to herein as the "SECOND AMENDMENT EFFECTIVE DATE"):

<PAGE>

(A) BCC, Company and License Sub shall have delivered to
Administrative Agent sufficient originally executed copies for each
Lender and its counsel of this Waiver and Amendment; Administrative
Agent and Lenders constituting Requisite Lenders shall each have
executed a counterpart of this Waiver and Amendment; and Company and
Administrative Agent shall have received written or telephonic
notification of such execution by Requisite Lenders and authorization of
delivery thereof; and

(B) Administrative Agent shall have received from Company, for
distribution to each Lender that has executed and delivered a
counterpart of this Waiver and Amendment on or prior to 5:00 p.m. (New
York City time) on February 28, 1997, an amendment fee in an amount
equal to 0.25% of the combined AXEL Exposure and Revolving Loan Exposure
of such Lender.

SECTION 5. REPRESENTATIONS AND WARRANTIES

In order to induce Lenders to enter into this Waiver and Amendment and
to amend the Credit Agreement in the manner provided herein, each of BCC and
Company hereby represents and warrants that after giving effect to this Waiver
and Amendment:

(A) CORPORATE POWER AND AUTHORITY. Each of BCC, Company and
License Sub has all requisite corporate power and authority to enter
into this Waiver and Amendment, and each of BCC and Company has all
requisite corporate power and authority to carry out the transactions
contemplated by, and perform its obligations under, the Credit Agreement
as amended by this Waiver and Amendment.

(B) AUTHORIZATION OF AGREEMENTS. The execution and delivery of
this Waiver and Amendment and the performance of the Credit Agreement as
amended by this Waiver and Amendment (as so amended, the "AMENDED
AGREEMENT") have been duly authorized by all necessary corporate action
on the part of BCC, Company and License Sub.

(C) NO CONFLICT. The execution and delivery by each of BCC and
Company of this Waiver and Amendment and the performance by Company of
the Amended Agreement do not and will not (i) violate any provision of
any law or any governmental rule or regulation applicable to BCC,
Company or any of their respective Subsidiaries, the Certificate or
Articles of Incorporation or Bylaws of BCC or Company or any of their
respective Subsidiaries or any order, judgment or decree of any court or
other agency or government binding on BCC, Company or any of their
respective Subsidiaries, (ii) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under
any Contractual Obligation of BCC, Company or any of their respective
Subsidiaries, (iii) result in or require the creation or imposition of
any Lien upon any of the properties or assets of BCC, Company or any of
their respective Subsidiaries (other than Liens created under any of the
Loan Documents in favor of Collateral Agent on behalf of Lenders), or
(iv) require any approval of stockholders or

<PAGE>

any approval or consent of any Person under any Contractual Obligation
of BCC, Company or any of their respective Subsidiaries.

(D) GOVERNMENTAL CONSENTS. The execution and delivery by each of
BCC and Company of this Waiver and Amendment and the performance by BCC
and Company of the Amended Agreement do not and will not require any
registration with, consent or approval of or notice to, or other action
to, with or by, any federal, state or other governmental authority or
regulatory body.

(E) BINDING OBLIGATION. This Waiver and Amendment and the Amended
Agreement have been duly executed and delivered by each of BCC and
Company and are the legally valid and binding obligations of BCC and
Company, enforceable against BCC and Company in accordance with their
respective terms, except as may be limited by bankruptcy, insolvency
reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles relating to
enforceability.

(F) INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT
AGREEMENT. The representations and warranties contained in Section 4 of
the Credit Agreement are and will be true, correct and complete in all
material respects on and as of the Second Amendment Effective Date to
the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an
earlier date, in which case they were true, correct and complete in all
material respects on and as of such earlier date.

(G) ABSENCE OF DEFAULT. No event has occurred and is continuing
that would constitute an Event of Default or a Potential Event of
Default.

(H) NO CHANGE TO ORGANIZATIONAL DOCUMENTS. Neither the
Certificate of Incorporation nor the Bylaws of BCC or of Company has
been amended, supplemented or otherwise modified since the Closing Date.

SECTION 6. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND
THE OTHER LOAN DOCUMENTS.

(A) On and after the Second Amendment Effective Date, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or
words of like import referring to the Credit Agreement, and each reference in
the other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or
words or like import referring to the Credit Agreement shall mean and be a
reference to the Amended Agreement.

(B) Except as specifically amended by this Waiver and Amendment, the
Credit Agreement and the other Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed.

<PAGE>

(C) The execution, delivery and performance of this Waiver and Amendment
shall not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of Agent or
any Lender under, the Credit Agreement or any of the other Loan Documents.

SECTION 7. FEES AND EXPENSES.

Each of BCC and Company acknowledges that all costs, fees and expenses
as described in subsection 9.2 of the Credit Agreement incurred by Agents and
their respective counsel with respect to this Waiver and Amendment and the
documents and transactions contemplated hereby shall be for the account of BCC
and Company.

SECTION 8. HEADINGS.

Section and subsection headings in this Waiver and Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Waiver and Amendment for any other purpose or be given any
substantive effect.

SECTION 9. COUNTERPARTS

This Waiver and Amendment may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.

SECTION 10. GOVERNING LAW

THIS WAIVER AND AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.

SECTION 11. ACKNOWLEDGEMENT AND CONSENT BY CREDIT SUPPORT
PARTIES

BCC is a party to the BCC Pledge Agreement and the BCC Security
Agreement (collectively, the "BCC COLLATERAL DOCUMENTS") and the BCC Guaranty,
in each case as

<PAGE>

amended through the Second Amendment Effective Date, pursuant to which BCC has
(a) guarantied the Obligations and (b) created Liens in favor of Collateral
Agent on certain Collateral and pledged certain Collateral to Collateral Agent
to secure the obligations of BCC under the BCC Guaranty. License Sub is a party
to the License Sub Guaranty, as amended through the Second Amendment Effective
Date, pursuant to which License Sub has guarantied the Obligations. BCC and
License Sub are collectively referred to herein as the "CREDIT SUPPORT PARTIES",
and the BCC Guaranty, the BCC Collateral Documents and the License Sub Guaranty
are collectively referred to herein as the "CREDIT SUPPORT DOCUMENTS".

Each Credit Support Party hereby acknowledges that it has reviewed the
terms and provisions of the Credit Agreement and this Waiver and Amendment and
consents to the amendment of the Credit Agreement effected pursuant to this
Waiver and Amendment. Each Credit Support Party hereby confirms that each Credit
Support Document to which it is a party or otherwise bound and all Collateral
encumbered thereby will continue to guaranty or secure, as the case may be, to
the fullest extent possible the payment and performance of all "Guarantied
Obligations" and "Secured Obligations", as the case may be (in each case as such
terms are defined in the applicable Credit Support Document), including without
limitation the payment and performance of all such "Guarantied Obligations" or
"Secured Obligations", as the case may be, in respect of the Obligations of
Company now or hereafter existing under or in respect of the Amended Agreement
and the Notes defined therein.

Each Credit Support Party acknowledges and agrees that any of the Credit
Support Documents to which it is a party or otherwise bound shall continue in
full force and effect and that all of its obligations thereunder shall be valid
and enforceable and shall not be impaired or limited by the execution or
effectiveness of this Waiver and Amendment. Each Credit Support Party represents
and warrants that all representations and warranties contained in the Amended
Agreement and the Credit Support Documents to which it is a party or otherwise
bound are true, correct and complete in all material respects on and as of the
Second Amendment Effective Date to the same extent as though made on and as of
that date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.

Each Credit Support Party acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this Waiver and
Amendment, such Credit Support Party is not required by the terms of the Credit
Agreement or any other Loan Document to consent to the amendments to the Credit
Agreement effected pursuant to this Waiver and Amendment and (ii) nothing in the
Credit Agreement, this Waiver and Amendment or any other Loan Document shall be
deemed to require the consent of such Credit Support Party to any future
amendments to the Credit Agreement.

[Remainder of page intentionally left blank]

<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Waiver and
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.

LENDERS:

GOLDMAN SACHS CREDIT PARTNERS L.P.,
as Arranging Agent and as a Lender

By:
___________________________________________
Authorized Signatory

CANADIAN IMPERIAL BANK OF
COMMERCE, NEW YORK AGENCY,
as Administrative Agent

By: CIBC Wood Gundy Securities Corp.,
as agent

By:
____________________________________
Managing Director

CIBC INC.,
as a Lender

By: CIBC Wood Gundy Securities Corp.,
as agent

By:
___________________________________
Managing Director

S-1

<PAGE>

BANQUE FRANCAISE DU COMMERCE
EXTERIEUR,
as a Lender

By:
____________________________________________
Name:
Title:

DLJ CAPITAL FUNDING, INC.,
as a Lender

By:
____________________________________________
Name:
Title:

MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY,
as a Lender

By:
____________________________________________
Name:
Title:

MERRILL LYNCH SENIOR FLOATING
RATE FUND, INC.,
as a Lender

By:
____________________________________________
Name:
Title:

S-2

<PAGE>

METROPOLITAN LIFE INSURANCE
COMPANY,
as a Lender

By:
____________________________________________
Name:
Title:

THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY,
as a Lender

By:
____________________________________________
Name:
Title:

PILGRIM AMERICA PRIME RATE
TRUST,
as a Lender

By:
____________________________________________
Name:
Title:

PRIME INCOME TRUST,
as a Lender

By:
____________________________________________
Name:
Title:

S-3

<PAGE>

RESTRUCTURED OBLIGATIONS
BACKED BY SENIOR ASSETS B.V.,
as a Lender

By: Chancellor LGT Senior Secured Management,
Inc., as Portfolio Advisor

By:
____________________________________________
Name:
Title:

SENIOR DEBT PORTFOLIO,
as a Lender

By: Boston Management and Research
as Investment Advisor

By:
____________________________________________
Name:
Title:

STRATA FUNDING LTD.,
as a Lender

By:
____________________________________________
Name:
Title:

VAN KAMPEN AMERICAN CAPITAL
PRIME RATE INCOME TRUST,
as a Lender

By:
____________________________________________
Name:
Title:

S-4

<PAGE>

BCC AND COMPANY:

BENEDEK BROADCASTING
CORPORATION

By:
____________________________________________
Name:
Title:

BENEDEK COMMUNICATIONS
CORPORATION

By:
____________________________________________
Name:
Title:

BENEDEK LICENSE CORPORATION

By:
____________________________________________
Name:
Title:

S-5

<PAGE>

Exhibit 21

BENEDEK COMMUNICATIONS CORPORATION AND SUBSIDIARIES

Subsidiaries of the Company
at December 31, 1996

Benedek Broadcasting Corporation, a Delaware corporation,
100% stockholder of
Benedek License Corporation, a Delaware corporation

<PAGE>

Exhibit 23

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the use of our report dated February 28, 1997 on the
consolidated financial statements of Benedek Communications Corporation and
Subsidiaries and the consolidated supplemental schedule II included in or made a
part of its Annual Report on Form 10-K for the year ended December 31, 1996
filed with the Securities and Exchange Commission. We also consent to the
reference to our firm under the caption "Selected Consolidated Financial Data"
in such Annual Report.

/s/ McGLADREY & PULLEN, LLP

Rockford, Illinois
March 26, 1997

<PAGE>

<ARTICLE> 5

<S> <C>
<PERIOD-TYPE> 12-mos
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-START> Jan-01-1996
<PERIOD-END> Dec-31-1996
<CASH> 8,091,683
<SECURITIES> 0
<RECEIVABLES> 24,226,731
<ALLOWANCES> 483,520
<INVENTORY> 0
<CURRENT-ASSETS> 39,908,907
<PP&E> 123,870,640
<DEPRECIATION> 39,849,340
<TOTAL-ASSETS> 495,016,240
<CURRENT-LIABILITIES> 36,211,154
<BONDS> 344,219,003
<COMMON> 70,300
105,519,263
0
<OTHER-SE> (51,631,045)
<TOTAL-LIABILITY-AND-EQUITY> 495,016,240
<SALES> 108,913,163
<TOTAL-REVENUES> 110,891,836
<CGS> 14,505,712
<TOTAL-COSTS> 14,505,712
<OTHER-EXPENSES> 81,120,977
<LOSS-PROVISION> 396,560
<INTEREST-EXPENSE> 30,688,968
<INCOME-PRETAX> (15,820,390)
<INCOME-TAX> (4,663,829)
<INCOME-CONTINUING> (11,156,552)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (11,156,552)
<EPS-PRIMARY> (2.94)
<EPS-DILUTED> 0

</TABLE>