8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 5, 2015 (September 7, 2015)

MEDIA GENERAL, INC.

(Exact name of registrant as specified in its charter)

Virginia	1-6383	46-5188184
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

333 E. Franklin Street

Richmond, VA 23219

(Address of principal executive offices, including zip code)

(804) 887-5000

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☒ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01     Other Events.

On September 8, 2015, Media General, Inc. (the “Company”) announced the entry into an Agreement and Plan of Merger by and among the Company, certain of its subsidiaries and Meredith Corporation, an Iowa corporation (“Meredith”), providing for a strategic business combination transaction between the Company and Meredith (the “Meredith Merger”). This Form 8-K includes Meredith’s audited financial statements as of June 30, 2015 and 2014 and for each of the years in the three year period ended June 30, 2015, and the pro forma financial information relating to the Meredith Merger.

Item 9.01.    Financial Statements and Exhibits.

(a) Financial statements of business acquired

The audited consolidated financial statements of Meredith as of June 30, 2015 and 2014 and for each of the years in the three-year period ended June 30, 2015, the notes related thereto and the report of the independent registered public accounting firm thereon are filed herewith as Exhibit 99.1 and incorporated herein by reference.

The audited consolidated financial statements of each of LIN Media, LLC (“LIN Media”) and LIN Television Corporation (“LIN Television”) as of December 31, 2013, and 2012 and for each of the years in the three-year period ended December 31, 2013, the notes related thereto and the reports of the independent registered public accounting firm thereon are filed herewith as Exhibit 99.2 and incorporated herein by reference.

The unaudited consolidated financial statements of each of LIN Media and LIN Television as of September 30, 2014 and 2013 and for each of the nine-months ended September 30, 2014 and 2013 and the notes related thereto are filed herewith as Exhibit 99.4 and incorporated herein by reference .

(b) Pro forma financial information

The unaudited pro forma condensed combined financial information as of and for the six months ended June 30, 2015 and for the year ended December 31, 2014 and the notes related thereto are filed herewith as Exhibit 99.3 and incorporated herein by reference.

(d) Exhibits

Exhibit Number	Description
23.1	Consent of KPMG LLP, independent registered public accounting firm of Meredith.
23.2	Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm of LIN Media.
23.3	Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm of LIN Television.
99.1	Audited consolidated financial statements of Meredith as of June 30, 2015 and 2014 and for each of the years in the three-year period ended June 30, 2015.
99.2	Audited consolidated financial statements of each of LIN Media and LIN Television as of December 31, 2013 and 2012 and for each of the years in the three-year period ended December 31, 2013.
99.3	Unaudited pro forma condensed combined financial information as of and for the six months ended June 30, 2015 and for the year ended December 31, 2014.
99.4	Unaudited consolidated financial statements of each of LIN Media and LIN Television as of and for the nine months ended September 30, 2014 and 2013.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: November 5, 2015	MEDIA GENERAL, INC.
	By:	/s/ James F. Woodward
	Name:	James F. Woodward
	Title:	Senior Vice President – Finance and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number	Description
23.1	Consent of KPMG LLP, independent registered public accounting firm of Meredith.
23.2	Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm of LIN Media.
23.3	Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm of LIN Television.
99.1	Audited consolidated financial statements of Meredith as of June 30, 2015 and 2014 and for each of the years in the three-year period ended June 30, 2015.
99.2	Audited consolidated financial statements of each of LIN Media and LIN Television as of December 31, 2013 and 2012 and for each of the years in the three-year period ended December 31, 2013.
99.3	Unaudited pro forma condensed combined financial information as of and for the six months ended June 30, 2015 and for the year ended December 31, 2014.
99.4	Unaudited consolidated financial statements of each of LIN Media and LIN Television as of and for the nine months ended September 30, 2014 and 2013.

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the Registration Statements (No. 333-193654) on Form S-3 and (No. 333-204000 and 333-201200) on Form S-8 of Media General, Inc. of our report dated August 24, 2015, with respect to the consolidated balance sheets of Meredith Corporation and subsidiaries as of June 30, 2015 and 2014, and the related consolidated statements of earnings, comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year period ended June 30, 2015, and the effectiveness of internal control over financial reporting as of June 30, 2015, which report appears in the Form 8-K of Media General, Inc. dated November 5, 2015.

/s/ KPMG LLP

Des Moines, Iowa

November 4, 2015

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-204000), Form S-8 (No 333-201200) and Form S-3 (No. 333-193654) of Media General, Inc. of our report dated March 3, 2014, except with respect to our opinion on the consolidated financial statements insofar as it relates to the change in reportable segments described in Note 21 as to which the date is June 13, 2014, relating to the financial statements of LIN Media LLC, which appears in this Current Report on 8-K of Media General, Inc.

/s/PricewaterhouseCoopers LLP

Hartford, CT

November 5, 2015

EX-23.3

Exhibit 23.3

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-204000), Form S-8 (No 333-201200) and Form S-3 (No. 333-193654) of Media General, Inc. of our report dated March 3, 2014, except with respect to our opinion on the consolidated financial statements insofar as it relates to the change in reportable segments described in Note 19, as to which the date is June 13, 2014, relating to the financial statements of LIN Television Corporation, which appears in this Current Report on 8-K of Media General, Inc.

/s/ PricewaterhouseCoopers LLP

Hartford, CT

November 5, 2015

EX-99.1

Exhibit 99.1

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Financial Statements and Supplementary Data
Page
Report of Independent Registered Public Accounting Firm	2
Report of Management	4
Financial Statements
Consolidated Balance Sheets as of June 30, 2015 and 2014	5
Consolidated Statements of Earnings for the Years Ended June 30, 2015, 2014, and 2013	7
Consolidated Statements of Comprehensive Income for the Years Ended June 30, 2015, 2014, and 2013	8
Consolidated Statements of Shareholders' Equity for the Years Ended June 30, 2015, 2014, and 2013	9
Consolidated Statements of Cash Flows for the Years Ended June 30, 2015, 2014, and 2013	10
Notes to Consolidated Financial Statements	12

1

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders

Meredith Corporation:

We have audited the accompanying consolidated balance sheets of Meredith Corporation and subsidiaries (the Company) as of June 30, 2015 and 2014, and the related consolidated statements of earnings, comprehensive income, shareholders' equity, and cash flows for each of the years in the three-year period ended June 30, 2015. We also have audited the Company's internal control over financial reporting as of June 30, 2015, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these consolidated financial statements and an opinion on the Company's internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

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

2

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Meredith Corporation and subsidiaries as of June 30, 2015 and 2014, and the results of their operations and their cash flows for each of the years in the three-year period ended June 30, 2015, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of June 30, 2015, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

/s/ KPMG LLP

Des Moines, Iowa

August 24, 2015

3

REPORT OF MANAGEMENT

To the Shareholders of Meredith Corporation:

Meredith management is responsible for the preparation, integrity, and objectivity of the financial information included in this Annual Report on Form 10-K. We take this responsibility very seriously as we recognize the importance of having well-informed, confident investors. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include amounts based on our informed judgments and estimates. We have adopted appropriate accounting policies and are fully committed to ensuring that those policies are applied properly and consistently. In addition, we strive to report our consolidated financial results in a manner that is relevant, complete, and understandable. We welcome any suggestions from those who use our reports.

To meet our responsibility for financial reporting, our internal control systems and accounting procedures are designed to provide reasonable assurance as to the reliability of financial records. In addition, our internal audit staff monitors and reports on compliance with Company policies, procedures, and internal control systems.

The consolidated financial statements and the effectiveness of the Company's internal control over financial reporting have been audited by an independent registered public accounting firm in accordance with the standards of the Public Company Accounting Oversight Board (United States). The independent registered public accounting firm was given unrestricted access to all financial records and related information, including all Board of Directors and Board committee minutes.

The Audit Committee of the Board of Directors is responsible for reviewing and monitoring the Company's accounting policies, internal controls, and financial reporting practices. The Audit Committee is also directly responsible for the appointment, compensation, and oversight of the Company's independent registered public accounting firm. The Audit Committee consists solely of independent directors who meet with the independent registered public accounting firm, management, and internal auditors to review accounting, auditing, and financial reporting matters. To ensure complete independence, the independent registered public accounting firm has direct access to the Audit Committee without the presence of management representatives.

At Meredith, we have always placed a high priority on good corporate governance and will continue to do so in the future.

/s/ Joseph Ceryanec

Joseph Ceryanec

Chief Financial Officer

4

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Meredith Corporation and Subsidiaries

Consolidated Balance Sheets

Assets	June 30,	2015			2014
(In thousands)
Current assets
Cash and cash equivalents		$	22,833		$	36,587
Accounts receivable (net of allowances of $8,495 in 2015 and $7,813 in 2014)			284,646			257,644
Inventories			24,681			24,008
Current portion of subscription acquisition costs			122,350			96,893
Current portion of broadcast rights			4,516			4,551
Assets held for sale			—			56,010
Other current assets			23,505			17,429
Total current assets			482,531			493,122
Property, plant, and equipment
Land			24,858			23,363
Buildings and improvements			151,320			143,169
Machinery and equipment			324,185			314,839
Leasehold improvements			14,284			14,125
Construction in progress			12,975			5,610
Total property, plant, and equipment			527,622			501,106
Less accumulated depreciation			(313,886	)		(296,168	)
Net property, plant, and equipment			213,736			204,938
Subscription acquisition costs			103,842			101,533
Broadcast rights			1,795			3,114
Other assets			67,750			86,935
Intangible assets, net			972,382			813,297
Goodwill			1,001,246			840,861
Total assets		$	2,843,282		$	2,543,800

See accompanying Notes to Consolidated Financial Statements

5

Meredith Corporation and Subsidiaries

Consolidated Balance Sheets (continued)

Liabilities and Shareholders' Equity	June 30,	2015			2014
(In thousands except per share data)
Current liabilities
Current portion of long-term debt		$	62,500		$	87,500
Current portion of long-term broadcast rights payable			4,776			4,511
Accounts payable			93,944			81,402
Accrued expenses
Compensation and benefits			71,233			57,637
Distribution expenses			13,056			8,504
Other taxes and expenses			79,366			69,906
Total accrued expenses			163,655			136,047
Current portion of unearned subscription revenues			206,126			173,643
Total current liabilities			531,001			483,103
Long-term debt			732,500			627,500
Long-term broadcast rights payable			2,998			4,327
Unearned subscription revenues			151,221			151,533
Deferred income taxes			311,645			277,477
Other noncurrent liabilities			162,067			108,208
Total liabilities			1,891,432			1,652,148
Shareholders' equity
Series preferred stock, par value $1 per share
Authorized 5,000 shares; none issued			—			—
Common stock, par value $1 per share
Authorized 80,000 shares; issued and outstanding 37,657 shares in 2015 (excluding 24,451 treasury shares) and 36,776 shares in 2014 (excluding 24,395 treasury shares)			37,657			36,776
Class B stock, par value $1 per share, convertible to common stock
Authorized 15,000 shares; issued and outstanding 6,963 shares in 2015 and 7,700 shares in 2014			6,963			7,700
Additional paid-in capital			49,019			41,884
Retained earnings			870,859			814,050
Accumulated other comprehensive loss			(12,648	)		(8,758	)
Total shareholders' equity			951,850			891,652
Total liabilities and shareholders' equity		$	2,843,282		$	2,543,800

See accompanying Notes to Consolidated Financial Statements        

6

Meredith Corporation and Subsidiaries

Consolidated Statements of Earnings

Years ended June 30,	2015			2014			2013
(In thousands except per share data)
Revenues
Advertising	$	896,548		$	778,391		$	823,690
Circulation		313,685			327,214			322,223
All other		383,943			363,103			325,427
Total revenues		1,594,176			1,468,708			1,471,340
Operating expenses
Production, distribution, and editorial		598,941			567,024			561,058
Selling, general, and administrative		695,319			655,241			654,098
Depreciation and amortization		57,804			59,928			45,350
Total operating expenses		1,352,064			1,282,193			1,260,506
Income from operations		242,112			186,515			210,834
Interest expense, net		(19,352	)		(12,176	)		(13,430	)
Earnings before income taxes		222,760			174,339			197,404
Income taxes		(85,969	)		(60,798	)		(73,754	)
Net earnings	$	136,791		$	113,541		$	123,650
Basic earnings per share	$	3.07		$	2.54		$	2.78
Basic average shares outstanding		44,522			44,636			44,455
Diluted earnings per share	$	3.02		$	2.50		$	2.74
Diluted average shares outstanding		45,323			45,410			45,085
Dividends paid per share	$	1.78		$	1.68		$	1.58

See accompanying Notes to Consolidated Financial Statements            

7

Meredith Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

Years ended June 30,	2015			2014		2013
(In thousands)
Net earnings	$	136,791		$	113,541	$	123,650
Other comprehensive income (loss), net of income taxes
Pension and other postretirement benefit plans activity		(2,591	)		7,583		6,774
Unrealized loss on interest rate swaps		(1,299	)		—		—
Other comprehensive income (loss), net of income taxes		(3,890	)		7,583		6,774
Comprehensive income	$	132,901		$	121,124	$	130,424

See accompanying Notes to Consolidated Financial Statements            

8

Meredith Corporation and Subsidiaries

Consolidated Statements of Shareholders' Equity

(In thousands except per share data)	Common Stock - $1 par value			Class B Stock - $1 par value			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total
Balance at June 30, 2012	$	35,791		$	8,716		$	53,275		$	722,778		$	(23,115	)	$	797,445
Net earnings		—			—			—			123,650			—			123,650
Other comprehensive income, net of tax		—			—			—			—			6,774			6,774
Stock issued under various incentive plans, net of forfeitures		1,537			—			37,982			—			—			39,519
Purchases of Company stock		(1,471	)		(7	)		(53,256	)		—			—			(54,734	)
Share-based compensation		—			—			11,518			—			—			11,518
Conversion of class B to common stock		385			(385	)		—			—			—			—
Dividends paid, 1.58 dollars per share
Common stock		—			—			—			(57,196	)		—			(57,196	)
Class B stock		—			—			—			(13,331	)		—			(13,331	)
Tax benefit from incentive plans		—			—			651			—			—			651
Balance at June 30, 2013		36,242			8,324			50,170			775,901			(16,341	)		854,296
Net earnings		—			—			—			113,541			—			113,541
Other comprehensive income, net of tax		—			—			—			—			7,583			7,583
Stock issued under various incentive plans, net of forfeitures		1,550			—			57,335			—			—			58,885
Purchases of Company stock		(1,639	)		(1	)		(76,586	)		—			—			(78,226	)
Share-based compensation		—			—			12,224			—			—			12,224
Conversion of class B to common stock		623			(623	)		—			—			—			—
Dividends paid, 1.68 dollars per share
Common stock		—			—			—			(61,949	)		—			(61,949	)
Class B stock		—			—			—			(13,443	)		—			(13,443	)
Tax deficiency from incentive plans		—			—			(1,259	)		—			—			(1,259	)
Balance at June 30, 2014		36,776			7,700			41,884			814,050			(8,758	)		891,652
Net earnings		—			—			—			136,791			—			136,791
Other comprehensive loss, net of tax		—			—			—			—			(3,890	)		(3,890	)
Stock issued under various incentive plans, net of forfeitures		1,069			—			40,182			—			—			41,251
Purchases of Company stock		(924	)		(1	)		(45,839	)		—			—			(46,764	)
Share-based compensation		—			—			12,515			—			—			12,515
Conversion of class B to common stock		736			(736	)		—			—			—			—
Dividends paid, 1.78 dollars per share
Common stock		—			—			—			(67,276	)		—			(67,276	)
Class B stock		—			—			—			(12,706	)		—			(12,706	)
Tax benefit from incentive plans		—			—			277			—			—			277
Balance at June 30, 2015	$	37,657		$	6,963		$	49,019		$	870,859		$	(12,648	)	$	951,850

See accompanying Notes to Consolidated Financial Statements

9

Meredith Corporation and Subsidiaries

Consolidated Statements of Cash Flows

Years ended June 30,	2015			2014			2013
(In thousands)
Cash flows from operating activities
Net earnings	$	136,791		$	113,541		$	123,650
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation		38,918			35,627			33,607
Amortization		17,628			13,099			11,743
Share-based compensation		12,515			12,224			11,518
Deferred income taxes		47,220			25,178			44,848
Amortization of broadcast rights		16,576			8,785			9,660
Payments for broadcast rights		(16,364	)		(10,332	)		(13,036	)
Provision for write-down of impaired assets		3,142			11,447			—
Fair value adjustment to contingent consideration		(1,500	)		(5,700	)		(2,500	)
Excess tax benefits from share-based payments		(6,471	)		(4,855	)		(5,438	)
Changes in assets and liabilities, net of acquisitions/dispositions
Accounts receivable		(18,991	)		(2,430	)		(16,575	)
Inventories		(1,013	)		4,133			(5,814	)
Other current assets		(6,501	)		2,100			(1,899	)
Subscription acquisition costs		(27,766	)		(1,011	)		(46,601	)
Other assets		(391	)		5,620			7,052
Accounts payable		10,040			1,598			10,657
Accrued expenses and other liabilities		13,866			4,208			15,229
Unearned subscription revenues		(19,093	)		(30,013	)		13,806
Other noncurrent liabilities		(6,259	)		(5,129	)		(820	)
Net cash provided by operating activities		192,347			178,090			189,087
Cash flows from investing activities
Acquisitions of and investments in businesses		(257,030	)		(417,461	)		(50,190	)
Additions to property, plant, and equipment		(33,245	)		(24,822	)		(25,969	)
Proceeds from disposition of assets		83,434			—			—
Net cash used in investing activities		(206,841	)		(442,283	)		(76,159	)
Cash flows from financing activities
Proceeds from issuance of long-term debt		470,000			666,000			175,000
Repayments of long-term debt		(390,000	)		(301,000	)		(205,000	)
Dividends paid		(79,982	)		(75,392	)		(70,527	)
Purchases of Company stock		(46,764	)		(78,226	)		(54,734	)
Proceeds from common stock issued		41,251			58,885			39,519
Excess tax benefits from share-based payments		6,471			4,855			5,438
Other		(236	)		(2,016	)		(770	)
Net cash provided by (used in) financing activities		740			273,106			(111,074	)
Net increase (decrease) in cash and cash equivalents		(13,754	)		8,913			1,854
Cash and cash equivalents at beginning of year		36,587			27,674			25,820
Cash and cash equivalents at end of year	$	22,833		$	36,587		$	27,674

See accompanying Notes to Consolidated Financial Statements

10

Meredith Corporation and Subsidiaries

Consolidated Statements of Cash Flows (continued)

Years ended June 30,	2015		2014		2013
(In thousands)
Supplemental disclosures of cash flow information
Cash paid
Interest	$	19,111	$	11,271	$	12,758
Income taxes		40,419		34,957		22,871
Non-cash transactions
Broadcast rights financed by contracts payable		15,300		9,985		11,774

See accompanying Notes to Consolidated Financial Statements            

11

Meredith Corporation and Subsidiaries

Notes to Consolidated Financial Statements

1.  Summary of Significant Accounting Policies

Nature of Operations—Meredith Corporation (Meredith or the Company) is a diversified media company focused primarily on the home and family marketplace. The Company has two segments: local media and national media. The Company's local media segment includes 16 owned television stations and one managed television station and related digital and mobile media operations. The national media segment includes magazine publishing, custom content and customer relationship marketing, digital and mobile media, brand licensing, database-related activities, and other related operations. Meredith's operations are primarily diversified geographically within the United States (U.S.) and the Company has a broad customer base.

Principles of Consolidation—The consolidated financial statements include the accounts of Meredith Corporation and its wholly owned subsidiaries. Significant intercompany balances and transactions are eliminated. Meredith does not have any off-balance sheet financing activities. The Company's use of special-purpose entities is limited to Meredith Funding Corporation, whose activities are fully consolidated in Meredith's consolidated financial statements (See Note 6).

Retrospective Adjustments—During fiscal 2015, we updated the purchase accounting for an acquisition that occurred in fiscal 2014. We retrospectively adjusted the provisional amounts recognized at the acquisition date to reflect fair values and, as required by the accounting guidance for business combinations, made adjustments to the June 30, 2014, Consolidated Balance Sheet. (See Note 2.)

Use of Estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. The Company bases its estimates on historical experience, management expectations for future performance, and other assumptions as appropriate. Key areas affected by estimates include the assessment of the recoverability of long-lived assets, including goodwill and other intangible assets, which is based on such factors as estimated future cash flows; the determination of the net realizable value of broadcast rights, which is based on estimated future revenues; provisions for returns of magazines sold, which are based on historical experience and current marketplace conditions; pension and postretirement benefit expenses, which are actuarially determined and include assumptions regarding discount rates, expected returns on plan assets, and rates of increase in compensation and healthcare costs; and share-based compensation expense, which is based on numerous assumptions including future stock price volatility and employees' expected exercise and post-vesting employment termination behavior. While the Company re-evaluates its estimates on an ongoing basis, actual results may vary from those estimates.

Cash and Cash Equivalents—Cash and short-term investments with original maturities of three months or less are considered to be cash and cash equivalents. Cash and cash equivalents are stated at cost, which approximates fair value.

Accounts Receivable—The Company's accounts receivable are primarily due from advertisers. Credit is extended to clients based on an evaluation of each client's creditworthiness and financial condition; collateral is not required. The Company maintains allowances for uncollectible accounts, rebates, rate adjustments, returns, and discounts. The allowance for uncollectible accounts is based on the aging of such receivables and any known specific collectability exposures. Accounts are written off when deemed uncollectible. Allowances for rebates, rate adjustments, returns, and discounts are generally based on historical experience and current market conditions. Concentration of credit risk with respect to accounts receivable is generally limited due to the large number of geographically diverse clients and individually small balances.

Inventories—Inventories are stated at the lower of cost or market. Cost is determined on the last-in first-out (LIFO) basis for paper and on the first-in first-out or average basis for all other inventories.

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Subscription Acquisition Costs—Subscription acquisition costs primarily represent magazine agency commissions. These costs are deferred and amortized over the related subscription term, typically one to two years. In addition, direct-response advertising costs that are intended to solicit subscriptions and are expected to result in probable future benefits are capitalized. These costs are amortized over the period during which future benefits are expected to be received. The asset balance of the capitalized direct-response advertising costs is reviewed quarterly to ensure the amount is realizable. Any write-downs resulting from this review are expensed as subscription acquisition advertising costs in the current period. Capitalized direct-response advertising costs were $5.9 million at June 30, 2015 and $6.5 million at June 30, 2014. There were no material write-downs of capitalized direct-response advertising costs in any of the fiscal years in the three-year period ended June 30, 2015.

Property, Plant, and Equipment—Property, plant, and equipment are stated at cost. Costs of replacements and major improvements are capitalized, and maintenance and repairs are charged to operations as incurred. Depreciation expense is provided primarily by the straight-line method over the estimated useful lives of the assets: 5-45 years for buildings and improvements and 3-20 years for machinery and equipment. The costs of leasehold improvements are amortized over the lesser of the useful lives or the terms of the respective leases. Depreciation and amortization of property, plant, and equipment was $38.9 million in fiscal 2015, $35.6 million in fiscal 2014, and $33.6 million in fiscal 2013.

Broadcast Rights—Broadcast rights consist principally of rights to broadcast syndicated programs, sports, and feature films. The total cost of these rights is recorded as an asset and as a liability when programs become available for broadcast. The current portion of broadcast rights represents those rights available for broadcast that are expected to be amortized in the succeeding year. These rights are valued at the lower of unamortized cost or estimated net realizable value, and are generally charged to operations on an accelerated basis over the contract period. Impairments of unamortized costs to net realizable value are included in production, distribution, and editorial expenses in the accompanying Consolidated Statements of Earnings. There were no impairments to unamortized costs in fiscals 2015, 2014, or 2013. Future write-offs can vary based on changes in consumer viewing trends and the availability and costs of other programming.

Intangible Assets and Goodwill—Amortizable intangible assets consist primarily of network affiliation agreements, advertiser relationships, and customer lists. Intangible assets with finite lives are amortized over their estimated useful lives. The useful life of an intangible asset is the period over which the asset is expected to contribute directly or indirectly to future cash flows. Network affiliation agreements are amortized over the period of time the agreements are expected to remain in place, assuming renewals without material modifications to the original terms and conditions (generally 25 to 40 years from the original acquisition date). Other intangible assets are amortized over their estimated useful lives, ranging from 1 to 10 years.

Intangible assets with indefinite lives include Federal Communications Commission (FCC) broadcast licenses. These licenses are granted for a term of up to eight years, but are renewable if the Company provides at least an average level of service to its customers and complies with the applicable FCC rules and policies and the Communications Act of 1934. The Company has been successful in every one of its past license renewal requests and has incurred only minimal costs in the process. The Company expects the television broadcasting business to continue indefinitely; therefore, the cash flows from the broadcast licenses are also expected to continue indefinitely.

Goodwill and certain other intangible assets (FCC broadcast licenses and trademarks), which have indefinite lives, are not amortized but tested for impairment annually or when events occur or circumstances change that would indicate the carrying value exceeds the fair value. The review of goodwill is performed at the reporting unit level. The Company has three reporting units, local media, magazine brands, and Meredith Xcelerated Marketing (MXM). We also assess, at least annually, whether assets classified as indefinite-lived intangible assets continue to have indefinite lives.

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At May 31, 2015, the date the Company last performed our annual evaluation of impairment of goodwill, management elected to perform the two-step goodwill impairment test for all reporting units. The first step of this test is to compare the fair value of a reporting unit to its carrying value. In reviewing other indefinite-lived intangible assets for impairment, the Company compares the fair value of the asset to the asset’s carrying value.

Fair value is determined using a discounted cash flow model, which requires us to estimate the future cash flows expected to be generated by the reporting unit or to result from the use of the asset. These estimates include assumptions about future revenues (including projections of overall market growth and our share of market), estimated costs, and appropriate discount rates where applicable. Our assumptions are based on historical data, various internal estimates, and a variety of external sources and are consistent with the assumptions used in both our short-term financial forecasts and long-term strategic plans. Depending on the assumptions and estimates used, future cash flow projections can vary within a range of outcomes. Changes in key assumptions about the local media, magazine brands, and MXM and their prospects or changes in market conditions could result in an impairment charge.

Additional information regarding intangible assets and goodwill is provided in Note 4.

Impairment of Long-lived Assets—Long-lived assets (primarily property, plant, and equipment and amortizable intangible assets) are reviewed for impairment whenever events and circumstances indicate the carrying value of an asset may not be recoverable. Recoverability is measured by comparison of the forecasted undiscounted cash flows of the operation to which the assets relate to the carrying amount of the assets. Tests for impairment or recoverability require significant management judgment, and future events affecting cash flows and market conditions could result in impairment losses.

Derivative Financial Instruments—Meredith does not engage in derivative or hedging activities, except to hedge interest rate risk on debt as described in Note 6. Fundamental to our approach to risk management is the desire to minimize exposure to volatility in interest costs of variable rate debt, which can impact our earnings and cash flows. In fiscal 2015, we entered into interest rate swap agreements with counterparties that are major financial institutions. These agreements effectively fix the variable rate cash flow on $300.0 million of a combination of our variable-rate private placement senior notes and bank term loan. We designated and accounted for the interest rate swaps as cash flow hedges in accordance with Accounting Standards Codification 815, Derivatives and Hedging. The effective portion of the change in the fair value of interest rate swaps is reported in other comprehensive income (loss). The gain or loss included in other comprehensive income (loss) is subsequently reclassified into net earnings on the same line in the Consolidated Statements of Earnings as the hedged item in the same period that the hedge transaction affects net earnings. The ineffective portion of a change in fair value of the interest rate swaps would be reported in interest expense. During fiscal 2015, the interest rate swap agreements were considered effective hedges and there were no material gains or losses recognized in earnings for hedge ineffectiveness.

Revenue Recognition—The Company's primary source of revenue is advertising. Other sources include circulation and other revenues.

Advertising revenues—Advertising revenues are recognized when advertisements are published (defined as an issue's on-sale date) or aired by the broadcasting station, net of agency commissions and net of provisions for estimated rebates, rate adjustments, and discounts. Barter revenues are included in advertising revenue and are also recognized when the commercials are broadcast. Barter advertising revenues and the offsetting expense are recognized at the fair value of the advertising surrendered, as determined by similar cash transactions. Barter advertising revenues were not material in any period. Website advertising revenues are recognized ratably over the contract period or as services are delivered.

Circulation revenues—Circulation revenues include magazine single copy and subscription revenue. Single copy revenue is recognized upon publication, net of provisions for estimated returns. The Company bases its estimates for returns on historical experience and current marketplace conditions. Revenues from magazine subscriptions are deferred and recognized proportionately as products are distributed to subscribers.

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Other revenues—Revenues from customer relationship marketing and other custom programs are recognized when the products or services are delivered. In addition, the Company participates in certain arrangements containing multiple deliverables. The guidance for accounting for multiple-deliverable arrangements requires that overall arrangement consideration be allocated to each deliverable (unit of accounting) in the revenue arrangement based on the relative selling price as determined by vendor specific objective evidence, third-party evidence, or estimated selling price. The related revenue is recognized when each specific deliverable of the arrangement is delivered. Brand licensing-based revenues are accrued generally monthly or quarterly based on the specific mechanisms of each contract. Payments are generally made by the Company's partners on a quarterly basis. Generally, revenues are accrued based on estimated sales and adjusted as actual sales are reported by partners. These adjustments are typically recorded within three months of the initial estimates and have not been material. Any minimum guarantees are typically earned evenly over the fiscal year. Retransmission revenues are recognized over the contract period based on the negotiated fee.

In certain instances, revenues are recorded gross in accordance with GAAP although the Company receives cash for a lesser amount due to the netting of certain expenses. Amounts received from customers in advance of revenue recognition are deferred as liabilities and recognized as revenue in the period earned.

Contingent Consideration—The Company estimates and records the acquisition date estimated fair value of contingent consideration as part of purchase price consideration for acquisitions. Additionally, each reporting period, the Company estimates changes in the fair value of contingent consideration, and any change in fair value is recognized in the Consolidated Statement of Earnings. An increase in the earn-out expected to be paid will result in a charge to operations in the quarter that the anticipated fair value of contingent consideration increases, while a decrease in the earn-out expected to be paid will result in a credit to operations in the quarter that the anticipated fair value of contingent consideration decreases. The estimate of the fair value of contingent consideration requires subjective assumptions to be made of future operating results, discount rates, and probabilities assigned to various potential operating result scenarios. Future revisions to these assumptions could materially change the estimate of the fair value of contingent consideration and, therefore, materially affect the Company’s future financial results.

Advertising Expenses—The majority of the Company's advertising expenses relate to direct-mail costs for magazine subscription acquisition efforts. Advertising costs that are not capitalized are expensed the first time the advertising takes place. Total advertising expenses included in the Consolidated Statements of Earnings were $75.8 million in fiscal 2015, $79.5 million in fiscal 2014, and $90.2 million in fiscal 2013.

Share-based Compensation—The Company establishes fair value for its equity awards to determine their cost and recognizes the related expense over the appropriate vesting period. The Company recognizes expense for stock options, restricted stock, restricted stock units, and shares issued under the Company's employee stock purchase plan. See Note 11 for additional information related to share-based compensation expense.

Income Taxes—The income tax provision is calculated under the liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period when such a change is enacted.

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50 percent likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

Self-Insurance—The Company self-insures for certain medical claims, and its responsibility generally is capped through the use of a stop loss contract with an insurance company at a certain dollar level (usually $300 thousand). A third-party administrator is used to process claims. The Company uses actual claims data and estimates of incurred-but-not-reported claims to calculate estimated liabilities for unsettled claims on an undiscounted basis. Although management re-evaluates the assumptions and reviews the claims experience on an ongoing basis, actual claims paid could vary significantly from estimated claims.

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Pensions and Postretirement Benefits Other Than Pensions—Retirement benefits are provided to employees through pension plans sponsored by the Company. Pension benefits are primarily a function of both the years of service and the level of compensation for a specified number of years. It is the Company's policy to fund the qualified pension plans to at least the extent required to maintain their fully funded status. In addition, the Company provides health care and life insurance benefits for certain retired employees, the expected costs of which are accrued over the years that the employees render services. It is the Company's policy to fund postretirement benefits as claims are paid. Additional information is provided in Note 8.

Comprehensive Income—Comprehensive income consists of net earnings and other gains and losses affecting shareholders' equity that, under GAAP, are excluded from net earnings. Other comprehensive income (loss) includes changes in prior service cost and net actuarial losses from pension and postretirement benefit plans, net of taxes, and changes in the fair value of interest rate swap agreements, net of taxes, to the extent that they are effective.

Earnings Per Share—Basic earnings per share is calculated by dividing net earnings by the weighted average common and Class B shares outstanding. Diluted earnings per share is calculated similarly but includes the dilutive effect, if any, of the assumed exercise of securities, including the effect of shares issuable under the Company's share-based incentive plans.

Adopted Accounting Pronouncements—In July 2013, the Financial Accounting Standards Board (FASB) issued guidance on the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance requires the netting of unrecognized tax benefits against a deferred tax asset for a loss or other carryforward that would apply in settlement of uncertain tax positions. Under the new standard, unrecognized tax benefits are netted against all available same-jurisdiction loss or other tax carryforwards that would be utilized, rather than only against carryforwards that are created by the unrecognized tax benefits. The guidance was effective for the Company in the first quarter of fiscal 2015. The adoption of this guidance did not have an impact on our results of operations or cash flows and we have updated our presentation of unrecognized tax benefits net of our deferred tax assets where applicable on our Consolidated Balance Sheets.

In April 2015, the FASB issued guidance related to disclosures for investments in certain entities that calculate net asset value (NAV) per share. This guidance eliminates the requirement to categorize investments in the fair value hierarchy if their fair value is measured at NAV per share. The reporting entity must disclose the amount of investments measured at NAV to allow users to reconcile total investments in the fair value hierarchy to total investments measured at fair value in the Consolidated Balance Sheets. The guidance is effective for fiscal years beginning after December 15, 2015, with early adoption permitted. The Company adopted this update for the year ended June 30, 2015. The adoption of this guidance required a change in the format of a disclosure only and did not have an impact on our results.

Pending Accounting Pronouncements—In May 2014, the FASB issued an accounting standards update that replaces existing revenue recognition guidance. The new guidance requires a company to recognize revenue for the transfer of promised goods or services equal to the amount it expects to receive in exchange for those goods or services. Additionally, the guidance requires enhanced disclosures about the nature, amount, timing, and uncertainty of revenue and cash flows from customer contracts. This guidance will be effective for in the Company in the first quarter of fiscal 2019. Early application is not permitted and companies may chose either a full retrospective or cumulative effect method of adoption. The Company is evaluating the method of adoption and the impact the guidance will have on our results of operations and financial position.

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In April 2015, the FASB issued guidance on the presentation of debt issuance costs. The new standard requires that debt issuance costs be recorded as a reduction from the face amount of the related debt, with amortization recorded as interest expense, rather than recording as a deferred asset. The guidance is effective for the Company in the first quarter of fiscal 2017 with early adoption permitted. The guidance is to be retrospectively applied to all prior periods. Adoption of the new guidance is not expected to have a material impact on the consolidated financial statements.

In April 2015, the FASB issued guidance on the presentation of cloud computing arrangements that include a software license. The new guidance requires capitalization of the software license fee as internal-use software if certain criteria are met, otherwise the costs are expensed as incurred. The standard is effective for the Company in the first quarter of fiscal 2017. Early adoption is permitted and companies can chose either prospective adoption to arrangements entered into or materially modified after the effective date, or full retrospective adoption. Adoption of the new guidance is not expected to have a material impact on the consolidated financial statements.

In June 2015, the FASB issued an accounting standards update that made technical corrections to the FASB Accounting Standards Codification. These technical corrections are divided into four categories: amendments related to differences between original guidance and the codification, guidance clarification and reference corrections, minor structural changes to simplify the codification, and minor improvements that are not expected to have a significant impact on current accounting practice. The amendments are effective for the Company in the first quarter of fiscal 2017 with early adoption permitted. All other changes are effective upon the issuance of the guidance. Adoption of the amendments is not expected to have a material impact on the consolidated financial statements.

2.  Acquisitions

Fiscal 2015

During fiscal 2015, Meredith paid $257.0 million primarily for the acquisitions of the television station WGGB, the

ABC affiliate in Springfield, Massachusetts; MyWedding LLC (Mywedding); the television station WALA, the FOX affiliate in Mobile, Alabama-Pensacola, Florida; Selectable Media, Inc. (Selectable Media); the Shape brand and related digital assets (collectively Shape); and the assets of a shopper marketing platform technology.

On October 31, 2014, Meredith acquired WGGB. The results of WGGB's operations have been included in the consolidated financial statements since that date. The fair value of the consideration, including the purchase of working capital, totaled $52.6 million, which consisted of $49.3 million of cash and $3.3 million of contingent consideration. The contingent consideration arrangement requires the Company to pay contingent payments based on certain future regulatory actions. We estimated the fair value of the contingent consideration using a probability-weighted discounted cash flow model. The fair value is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in Note 14. As of June 30, 2015, the Company estimates the future payments will range from zero to $4.0 million.

Effective November 1, 2014, Meredith completed its acquisition of Martha Stewart Living magazine and its related digital assets (collectively Martha Stewart Living Media Properties). In addition, Meredith entered into a 10-year licensing arrangement with Martha Stewart Living Omnimedia (MSLO) for the licensing of the Martha Stewart Living trade name. The acquired business operations include sales and marketing, circulation, production, and other non-editorial functions. Meredith will source editorial content from MSLO. The results of the Martha Stewart Living Media Properties have been included in the consolidated financial statements since the effective date. There was no cash consideration exchanged in this transaction.

On November 13, 2014, Meredith acquired 100 percent of the membership interests in Mywedding. Mywedding operates mywedding.com, one of the top wedding websites in the U.S., providing couples with a complete wedding planning product suite. The results of Mywedding have been included in the consolidated financial statements since that date. The acquisition-date fair value of the consideration was $42.7 million, which consisted of $20.1 million of cash and $22.6 million of contingent consideration. The contingent consideration arrangement requires the Company to pay a contingent payment based on certain financial targets achieved during fiscal 2018 primarily based on earnings before interest, taxes, depreciation, and amortization (EBITDA), as defined in the acquisition agreement. The contingent consideration is not dependent on the continued employment of the sellers. We estimated the fair value of the contingent consideration using a probability-weighted discounted cash flow model. The fair value is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in Note 14. As of June 30, 2015, the Company estimates the future payments will range from $11.1 million to $40.0 million.

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On December 19, 2014, Meredith acquired WALA. The results of WALA's operations have been included in the consolidated financial statements since that date. The cash purchase price, including the purchase of working capital, was $90.4 million.

On December 30, 2014, Meredith acquired 100 percent of the outstanding stock of Selectable Media, a leading native and engagement-based digital advertising company. The results of Selectable Media have been included in the consolidated financial statements since that date. The acquisition-date fair value of the consideration totaled $30.2 million, which consisted of $23.0 million of cash and $7.2 million of contingent consideration. The contingent consideration arrangement requires the Company to pay contingent payments based on certain financial targets over the next three fiscal years primarily based on revenue, as defined in the acquisition agreement. The contingent consideration is not dependent on the continued employment of the sellers. We estimated the fair value of the contingent consideration using a probability-weighted discounted cash flow model. The fair value is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in Note 14. As of June 30, 2015, the Company estimates the future payments will range from $7.3 million to $8.0 million.

Effective February 1, 2015, Meredith completed its acquisition of Shape. Shape is the women's active lifestyle category leader with content focusing on exercise, beauty, nutrition, health, fashion, wellness, and other lifestyle topics to help women lead a healthier, active lifestyle. The results of Shape have been included in the consolidated financial statements since the effective date. The acquisition-date fair value of the consideration totaled $87.4 million, which consisted of $60.0 million of cash and $27.4 million of contingent consideration. The contingent consideration arrangement requires the Company to pay a contingent payment based on the achievement of certain financial targets over the next three fiscal years primarily based on operating profit, as defined in the acquisition agreement. We estimated the fair value of the contingent consideration using a probability-weighted discounted cash flow model. The fair value is based on significant inputs not observable in the market and thus represent a Level 3 measurement as defined in Note 14. As of June 30, 2015, the Company estimates the future payments will range from $25.2 million to $32.0 million.

On June 19, 2015, Meredith completed the acquisition of Qponix, a leading shopper marketing data platform technology (hereafter referred to as Meredith Shopper Marketing). The results of the business from these assets have been included in the consolidated financial statements since the date of acquisition. The acquisition-date fair value of the consideration totaled $2.3 million, which consisted of $1.5 million of cash and $0.8 million of contingent consideration. The contingent consideration arrangement requires the Company to pay a contingent payment based on a percentage of net revenues for a period of up to 10 years until the maximum payout is reached, as defined in the asset purchase agreement. We estimated the fair value of the contingent consideration using a probability-weighted discounted cash flow model. The fair value is based on significant inputs not observable in the market and thus represent a Level 3 measurement as defined in Note 14. As of June 30, 2015, the Company estimates the future payments will be $0.8 million.

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The following table summarizes the total estimated fair values of the assets acquired and liabilities assumed by segment during the year ended June 30, 2015:

(In thousands)	Local Media Acquisitions			National Media Acquisitions			Total
Accounts receivable	$	5,162		$	4,323		$	9,485
Current portion of broadcast rights		1,582			—			1,582
Other current assets		133			1,036			1,169
Property, plant, and equipment		14,391			130			14,521
Other noncurrent assets		1,907			3,055			4,962
Intangible assets		107,476			70,350			177,826
Total identifiable assets acquired		130,651			78,894			209,545
Deferred subscription revenue		—			(51,264	)		(51,264	)
Current portion of broadcast rights		(1,582	)		—			(1,582	)
Other current liabilities		(1,378	)		(6,808	)		(8,186	)
Long-term liabilities		(5,242	)		(59,634	)		(64,876	)
Total liabilities assumed		(8,202	)		(117,706	)		(125,908	)
Net identifiable assets acquired		122,449			(38,812	)		83,637
Goodwill		17,320			143,433			160,753
Net assets acquired	$	139,769		$	104,621		$	244,390

The following table provides details of the acquired intangible assets by acquisition:

(In thousands)	WGGB		Martha Stewart		Mywedding		WALA		Selectable Media		Shape		Meredith Shopper Marketing		Total
Intangible assets subject to amortization
National media
Advertiser relationships	$	—	$	3,200	$	1,600	$	—	$	2,250	$	6,700	$	—	$	13,750
Customer lists		—		1,850		—		—		—		1,200		—		3,050
Other		—		—		—		—		2,450		700		1,200		4,350
Local media
Retransmission agreements		761		—		—		3,193		—		—		—		3,954
Other		70		—		—		121		—		—		—		191
Total		831		5,050		1,600		3,314		4,700		8,600		1,200		25,295
Intangible assets not subject to amortization
National media
Trademarks		—		—		5,300		—		—		37,900		—		43,200
Internet domain names		—		—		—		—		—		6,000		—		6,000
Local media
FCC licenses		33,116		—		—		70,215		—		—		—		103,331
Total		33,116		—		5,300		70,215		—		43,900		—		152,531
Intangible assets, net	$	33,947	$	5,050	$	6,900	$	73,529	$	4,700	$	52,500	$	1,200	$	177,826

As of the date of each acquisition, Meredith allocated the purchase price to the assets acquired and liabilities assumed based on their respective preliminary fair values. The above purchase price allocations are considered preliminary and are subject to revisions when the valuations of intangible assets are finalized upon receipt of the various final valuation reports for those assets from third party valuation experts. Therefore, the provisional measurements of fixed assets, intangible assets, goodwill, and deferred income tax balances are subject to change.

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The useful life of the advertiser relationships ranges from three to four years, the customer lists' useful lives are two years, and other national media intangible assets' useful lives are five to seven years. The useful lives of the retransmission agreements are six years and local media other intangible assets' useful lives are one to three years.

For all acquisitions, goodwill is attributable primarily to expected synergies and the assembled workforces. Goodwill, with a provisionally assigned value of $136.2 million, is expected to be fully deductible for tax purposes.

Mywedding and Selectable Media are subject to legal and regulatory requirements, including but not limited to those related to taxation, in each of the jurisdictions in the countries in which they operate. The Company has conducted a preliminary assessment of liabilities arising in each of these jurisdictions, and has recognized provisional amounts in its initial accounting for the acquisitions for all identified liabilities in accordance with the business combinations guidance. However, the Company is continuing its review of these matters during the measurement period, and if new information about facts and circumstances that existed at the acquisition date identifies adjustments to the liabilities initially recognized, or any additional liabilities that existed at the acquisition date, the acquisition accounting will be revised to reflect the resulting adjustments to the provisional amounts initially recognized.

During fiscal 2015, acquisition related costs of $1.4 million were incurred. These costs are included in the selling, general, and administrative line in the Consolidated Statements of Earnings.

Fiscal 2014

During fiscal 2014, Meredith paid $417.5 million primarily for the acquisitions of the television station KMOV, the CBS affiliate in St. Louis, Missouri and the television station KTVK, an independent station in Phoenix, Arizona.

Effective February 28, 2014, Meredith acquired KMOV. The results of KMOV's operations have been included in the consolidated financial statements since that date. The final cash purchase price was $186.7 million, which included an additional cash working capital adjustment payment in fiscal 2015 of $0.9 million. During fiscal 2015, the Company finalized the determination of the fair values of the assets acquired and liabilities assumed. As such, fixed assets were decreased $0.5 million, network affiliation agreements intangible assets were increased $1.0 million, other intangibles were decreased $0.1 million, and a corresponding decrease of $0.4 million was recorded to goodwill. These adjustments did not have a significant impact on our Consolidated Balance Sheet as of June 30, 2014. Therefore, we have not retrospectively adjusted for these measurement period adjustments.

Effective June 19, 2014, Meredith acquired KTVK and an interest in the assets of KASW, the CW affiliate in Phoenix, Arizona. The final cash purchase price was $223.4 million. During fiscal 2015, the Company finalized the determination of the fair values of the assets acquired and liabilities assumed. The final cash purchase price was allocated as $167.4 million for KTVK and $56.0 million for the interest in KASW assets. As part of the FCC approval of the transaction, Meredith was required to sell its interest in the KASW assets. Accordingly, this interest was shown on the Consolidated Balance Sheet as assets held for sale at June 30, 2014. The sale of the Company's interest in the KASW assets was completed during fiscal 2015. As the final valuation of the intangible assets acquired was not complete at June 30, 2014, the recorded intangible asset values were based on provisional estimates of fair value. Upon determination of the final fair values of the assets acquired and liabilities assumed, the amount recorded to assets held for sale were retrospectively increased $23.0 million. A corresponding respective adjustment to the assets of KTVK was recorded as a $23.9 million reduction to the FCC license and $0.8 million reduction of goodwill, partially offset by a $1.7 million increase in retransmission agreements. The comparative information as of June 30, 2014, was retrospectively adjusted, as required by the accounting guidance for business combinations, to reflect the updated values assigned to each of the intangible assets.

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As of the date of each acquisition, Meredith allocates the purchase price to the assets acquired and liabilities assumed based on their respective preliminary fair values. The following table summarizes the total estimated fair values of the assets acquired and liabilities assumed:

(In thousands)
Accounts receivable	$	18,934
Current portion of broadcast rights		6,495
Other current assets		1,015
Property, plant, and equipment		31,719
Other noncurrent assets		10,186
Intangible assets		251,325
Total identifiable assets acquired		319,674
Current portion of broadcast rights		(6,495	)
Other current liabilities		(309	)
Long-term liabilities		(10,184	)
Total liabilities assumed		(16,988	)
Net identifiable assets acquired		302,686
Goodwill		51,456
Net assets acquired	$	354,142

The following table provides details of the acquired intangible assets by acquisition:

(In thousands)	KMOV		KTVK		Total
Intangible assets subject to amortization
Network affiliation agreements	$	10,750	$	—	$	10,750
Retransmission agreements		3,250		14,026		17,276
Other		7		1,014		1,021
Total		14,007		15,040		29,047
Intangible assets not subject to amortization
FCC licenses		101,973		120,305		222,278
Intangible assets, total	$	115,980	$	135,345	$	251,325

The useful life of the network affiliation agreement is seven years and other intangible assets useful lives range from one to six years.

Goodwill, with an assigned value of $51.5 million, is expected to be fully deductible for tax purposes and is attributable to expected synergies and the assembled workforces of KMOV and KTVK.

During fiscal 2014, acquisition related costs of $5.5 million were expensed in the period in which they were incurred. These costs are included in the selling, general, and administrative line in the Consolidated Statements of Earnings.

Fiscal 2013

Meredith paid $50.2 million in fiscal 2013 primarily for the acquisitions of Parenting and Babytalk magazines and related digital assets (collectively Parenting) and Living the Country Life, LLC (Living the Country Life) and additional capital contributions to our minority investment in the Next Issue Media joint venture.

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In October 2012, Meredith acquired the remaining 49 percent of the outstanding stock of Living the Country Life. The results of Living the Country Life's operations have been included in the consolidated financial statements since that date. The cash purchase price was $1.4 million.

In May 2013, Meredith acquired Parenting. The Parenting acquisition included Parenting and Babytalk magazine titles and related digital assets including the website www.parenting.com. The results of Parenting's operations have been included in the consolidated financial statements since that date. The acquisition-date fair value of the consideration totaled $45.5 million, which consisted of $41.5 million cash and a preliminary estimate of $4.0 million contingent consideration. The contingent consideration arrangement requires the Company to pay contingent payments should certain financial targets, generally based on revenues, be met over four fiscal years. Our estimate of the fair value of the contingent consideration is based on a probability-weighted discounted cash flow model. The estimated fair value is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in Note 14. Revenue growth for the Parenting acquisition was initially strong and in line with the original estimate; however, a slowdown in advertising revenues in the second half of fiscal 2014 resulted in lower revenue expectations. Therefore, the Company recognized non-cash credits to operations of $2.3 million in fiscal 2014 and $0.5 million in fiscal 2015, to reduce the estimated contingent consideration payable. These credits were recorded in the selling, general, and administrative expense line on the Consolidated Statements of Earnings. As of June 30, 2015, the Company estimates the future aggregate payments will range from zero to $5.1 million.

As a result of the acquisitions, the assets and liabilities of Parenting, consisting primarily of identifiable intangible assets and unearned subscription revenues, are reflected in the Company's Consolidated Balance Sheet. The consolidated financial statements reflect the allocation of the purchase price to the assets acquired and liabilities assumed, based on their respective fair values. Definite-lived intangible assets include an internet domain name of $3.1 million, trademark of $1.7 million, customer lists of $1.5 million, advertiser relationships of $1.3 million, and developed content of $0.9 million. The definite-lived intangible assets have useful lives ranging from two to 10 years. Goodwill is attributable to expected synergies and has an assigned value of $56.4 million, of which $33.0 million is expected to be deductible for tax purposes.

Acquisition related costs were expensed by the Company in the period in which they were incurred. Acquisition costs related to the acquisitions were not material to the Company's results of operations. In fiscal 2013, the Company incurred $5.1 million for acquisition costs for professional fees and expenses related to a strategic transaction that did not materialize. These costs are included in the selling, general, and administrative line in the Consolidated Statements of Earnings.

3.  Inventories

Inventories consist of paper stock, editorial content, and books. Of total net inventory values, 52 percent at June 30, 2015, and 49 percent at June 30, 2014, were determined using the LIFO method. LIFO inventory income included in the Consolidated Statements of Earnings was $0.5 million in fiscal 2015, $0.8 million in fiscal 2014, and $1.7 million in fiscal 2013.

June 30,	2015			2014
(In thousands)
Raw materials	$	13,900		$	11,993
Work in process		12,053			13,398
Finished goods		2,428			2,814
		28,381			28,205
Reserve for LIFO cost valuation		(3,700	)		(4,197	)
Inventories	$	24,681		$	24,008

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4.  Intangible Assets and Goodwill

Intangible assets consist of the following:

June 30,	2015							2014
(In thousands)	Gross Amount		Accumulated Amortization			Net Amount		Gross Amount		Accumulated Amortization			Net Amount
Intangible assets subject to amortization
National media
Advertiser relationships	$	20,879	$	(7,660	)	$	13,219	$	8,752	$	(6,069	)	$	2,683
Customer lists		9,120		(6,679	)		2,441		16,257		(14,852	)		1,405
Other		20,675		(7,361	)		13,314		17,105		(5,608	)		11,497
Local media
Network affiliation agreements		229,309		(129,362	)		99,947		228,314		(122,888	)		105,426
Retransmission agreements		21,229		(3,454	)		17,775		17,404		(188	)		17,216
Other		1,212		(126	)		1,086		1,020		—			1,020
Total	$	302,424	$	(154,642	)		147,782	$	288,852	$	(149,605	)		139,247
Intangible assets not subject to amortization
National media
Internet domain names							7,827							1,827
Trademarks							192,089							148,889
Local media
FCC licenses							624,684							523,334
Total							824,600							674,050
Intangible assets, net						$	972,382						$	813,297

Amortization expense was $17.6 million in fiscal 2015, $13.1 million in fiscal 2014, and $11.7 million in fiscal 2013. Future amortization expense for intangible assets is expected to be as follows:  $20.0 million in fiscal 2016, $17.8 million in fiscal 2017, $14.8 million in fiscal 2018, $12.5 million in fiscal 2019, and $11.6 million in fiscal 2020.

During fiscal 2014, the Company recorded an impairment charge of $10.3 million on national media intangible assets, including $9.5 million of trademarks and $0.8 million of customer lists. Management determined these intangible assets were fully impaired as part of management's commitment to performance improvement plans, including the conversion of Ladies' Home Journal from a subscription-based magazine to a quarterly newsstand special interest publication and the closure of Meredith's medical sales force training business. The impairment charges are recorded in the depreciation and amortization line in the Consolidated Statements of Earnings.

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Changes in the carrying amount of goodwill were as follows:

(In thousands)	National Media		Local Media		Total
Balance at June 30, 2013	$	788,854	$	—	$	788,854
Acquisitions		184		51,823		52,007
Balance at June 30, 2014		789,038		51,823		840,861
Acquisitions		143,433		16,952		160,385
Balance at June 30, 2015	$	932,471	$	68,775	$	1,001,246

The national media segment is comprised of two reporting units, the magazine brands reporting unit, which has $760.6 million of goodwill, and the MXM reporting unit, which has $171.9 million of goodwill.

Meredith completed annual impairment reviews of goodwill and intangible assets with indefinite lives as of May 31, 2015, 2014, and 2013. No impairments were recorded as a result of those reviews. As of May 31, 2015, the fair value of the local media reporting unit significantly exceeded its net assets, the fair value of the magazine brands reporting unit exceeded its net assets by approximately 20 percent, and the fair value of the MXM reporting unit exceeded its net assets by nearly 50 percent.

The fair value of the magazine brands reporting unit assumes a discount rate of 10 percent. Assumed revenue growth rates range from down 1.6 percent to up 2.0 percent. The assumed terminal growth rate is 2.0 percent. These assumptions are contingent upon a stable economic environment, continuing strong consumer engagement, and a continuing shift to digital platforms. Holding other assumptions constant, a 100 basis point increase in the discount rate would result in an estimated fair value that exceeds net assets by 4 percent. Holding other assumptions constant, a 100 basis point decrease in the terminal growth rate would result in an estimated fair value that exceeds net assets by 8 percent. Both of these scenarios individually would result in the magazine brands reporting unit passing step one of the test.

The fair value of the MXM reporting unit assumes a discount rate of 12 percent, near term revenue growth rates ranging from 5.0 percent to 7.0 percent, and a terminal growth rate of 5.0 percent. These assumptions are contingent upon a stable economic environment and either retaining or replacing key customers. Holding other assumptions constant, a 100 basis point increase in the discount rate would result in an estimated fair value that exceeds net assets by 30 percent. Holding other assumptions constant, a 100 basis point decrease in the terminal growth rate would result in an estimated fair value that exceeds net assets by more than 30 percent. Both of these scenarios individually would result in the MXM reporting unit passing step one of the test.

5.  Restructuring Accrual

During the second quarter of fiscal 2015, management committed to several performance improvement plans related to business realignments resulting primarily from recent broadcast station acquisitions, recent digital business acquisitions, and other selected workforce reductions. In connection with these plans, the Company recorded a pre-tax restructuring charge of $6.7 million. The restructuring charge includes severance and related benefit costs of $5.3 million related to the involuntary termination of employees and other write-downs and accruals of $0.2 million, which are recorded in the selling, general, and administrative line of the Consolidated Statements of Earnings. The Company also wrote down video production fixed assets that the Company abandoned for $1.2 million, which is recorded in the depreciation and amortization line of the Consolidated Statements of Earnings. The majority of severance costs will be paid out over the next 6 months. The plans affected approximately 140 employees.

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During the third quarter of fiscal 2015, management committed to several performance improvement plans related to certain acquisition integrations, business realignments, and other selected workforce reductions. In connection with these plans, the Company recorded a pre-tax restructuring charge of $9.9 million. The restructuring charge includes severance and related benefit costs of $9.4 million related to the involuntary termination of employees and other write-downs and accruals of $0.2 million, which are recorded in the selling, general, and administrative line of the Consolidated Statements of Earnings. The Company also wrote down manuscript and art inventory for $0.3 million, which is recorded in the production, distribution, and editorial line of the Consolidated Statements of Earnings. The majority of severance costs will be paid out over the next 9 months. The plans affected approximately 135 employees.

In the third quarter of fiscal 2014, management committed to several performance improvement plans related primarily to business realignments including converting Ladies' Home Journal from a monthly subscription magazine to a newsstand only quarterly special interest publication, the closing of our medical sales force training business, and other selected workforce reductions. In connection with these plans, the Company recorded a pre-tax restructuring charge of $20.8 million. The restructuring charge includes severance and related benefit costs of $8.5 million related to the involuntary termination of employees, an accrual for vacated lease spaces of $0.4 million, and other accruals of $0.5 million, all of which are recorded in the selling, general, and administrative line of the Consolidated Statements of Earnings. The Company also wrote down intangible assets by $10.3 million (see Note 4) and fixed assets of $0.9 million, which are recorded in the depreciation and amortization line of the Consolidated Statements of Earnings, and manuscript and art inventory by $0.2 million, which is recorded in the production, distribution, and editorial line of the Consolidated Statements of Earnings. The majority of severance costs have been paid out. These plans affected approximately 100 employees.

In the fourth quarter of fiscal 2014, management committed to a performance improvement plan related primarily to business realignments from recent broadcast station acquisitions that included selected workforce reductions. In connection with this plan, the Company recorded a pre-tax restructuring charge of $3.7 million. The restructuring charge includes severance and related benefit costs of $3.4 million related to the involuntary termination of employees and an accrual for vacating a building of $0.3 million, which are recorded in the selling, general, and administrative line of the Consolidated Statements of Earnings. The majority of severance costs have been paid out. The plan affected approximately 75 employees.

During the years ended June 30, 2015 and 2014, the Company recorded reversals of $0.1 million and $1.4 million, respectively, of excess restructuring reserves accrued in prior fiscal years. The reversals of excess restructuring reserves are recorded in the selling, general, and administrative line of the Consolidated Statements of Earnings.

Details of changes in the Company's restructuring accrual are as follows:

Years ended June 30,	2015			2014
(In thousands)
Balance at beginning of year	$	13,545		$	8,103
Severance accrual		14,670			11,915
Other accruals		285			1,141
Cash payments		(12,664	)		(6,258	)
Reversal of excess accrual		(105	)		(1,356	)
Balance at end of year	$	15,731		$	13,545

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6.  Long-term Debt

Long-term debt consists of the following:

June 30,	2015			2014
(In thousands)
Variable-rate credit facilities
Asset-backed bank facility of $100 million, due 10/23/2015	$	80,000		$	70,000
Revolving credit facility of $200 million, due 3/27/2019		77,500			20,000
Term loan of $250 million, due 3/27/2019		237,500			250,000
Private placement notes
7.19% senior notes, due 7/13/2014		—			25,000
2.62% senior notes, due 3/1/2015		—			50,000
3.04% senior notes, due 3/1/2016		50,000			50,000
3.04% senior notes, due 3/1/2017		50,000			50,000
3.04% senior notes, due 3/1/2018		50,000			50,000
Floating rate senior notes, due 12/19/2022		100,000			—
Floating rate senior notes, due 2/28/2024		150,000			150,000
Total long-term debt		795,000			715,000
Current portion of long-term debt		(62,500	)		(87,500	)
Long-term debt	$	732,500		$	627,500

The following table shows principal payments on the debt due in succeeding fiscal years:

Years ending June 30,
(In thousands)
2016	$	62,500
2017		75,000
2018		75,000
2019		332,500
2020		—
Thereafter		250,000
Total long-term debt	$	795,000

In connection with the asset-backed bank facility, Meredith entered into a revolving agreement to sell all of its rights, title, and interest in the majority of its accounts receivable related to advertising and miscellaneous revenues to Meredith Funding Corporation, a special purpose entity established to purchase accounts receivable from Meredith. At June 30, 2015, $172.0 million of accounts receivable net of reserves were outstanding under the agreement. Meredith Funding Corporation in turn sells receivable interests to a major national bank. In consideration of the sale, Meredith receives cash and a subordinated note, bearing interest at the prime rate, 3.25 percent at June 30, 2015, from Meredith Funding Corporation. The agreement is structured as a true sale under which the creditors of Meredith Funding Corporation will be entitled to be satisfied out of the assets of Meredith Funding Corporation prior to any value being returned to Meredith or its creditors. The accounts of Meredith Funding Corporation are fully consolidated in Meredith's consolidated financial statements. The interest rate on the asset-backed bank facility is based on a fixed spread over London Interbank Offered Rate (LIBOR). The weighted average effective interest rate was 1.04 percent as of June 30, 2015.

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In February 2015, we renewed our asset-backed bank facility for an additional six-month period on terms substantially similar to those previously in place. The renewed facility will expire in October 2015. We expect to renew the asset-backed bank facility on or before its expiration date under substantially similar terms.

During fiscal 2014, Meredith entered into a credit agreement that provided for a revolving credit facility of $200.0 million and a term loan of $250.0 million, for a five-year term which expires March 27, 2019. The term loan is payable in quarterly installments based on an amortization schedule as set forth in the agreement. The new credit agreement replaced our prior revolving credit facility. In connection with this transaction, in fiscal 2014 the Company wrote off $0.6 million of deferred financing costs to the interest expense line of the Consolidated Statements of Earnings.

In addition, Meredith issued $150.0 million in private placement floating-rate senior notes during fiscal 2014, which are due February 28, 2024. In fiscal 2015, Meredith issued $100.0 million in private placement floating-rate senior notes, which are due December 19, 2022.

During fiscal 2015, the Company entered into interest rate swap agreements to hedge variable interest rate risk on the $250.0 million floating-rate senior notes and on $50.0 million of the term loan. The expiration of the swaps is as follows: $50.0 million in August 2018, $100.0 million in March 2019, and $150.0 million in August 2019. Under the swaps the Company will pay fixed rates of interest (1.36 percent on the swap maturing in August 2018, 1.53 percent on the swap maturing in March 2019, and 1.76 percent on the swaps maturing in August 2019) and receive variable rates of interest based on the one to three-month London Interbank Offered Rate (LIBOR) (0.19 percent on the swap maturing in August 2018, 0.28 percent on the swap maturing in March 2019, and 0.28 percent on the swaps maturing in August 2019 as of June 30, 2015) on the $300.0 million notional amount of indebtedness. The swaps are designated as cash flow hedges. The Company evaluates the effectiveness of the hedging relationships on an ongoing basis by recalculating changes in fair value of the derivatives and related hedged items independently.

Unrealized gains or losses on cash flow hedges are recorded in other comprehensive loss to the extent the cash flow hedges are effective. The amount of the swap that offsets the effects of interest rate changes on the related debt is subsequently reclassified into interest expense. Any ineffective portions on cash flow hedges are recorded in interest expense. No material ineffectiveness existed at June 30, 2015.

The fair value of the interest rate swap agreements is the estimated amount the Company would pay or receive to terminate the swap agreements. At June 30, 2015, the swaps had a fair value of $2.2 million net liability. The Company is exposed to credit-related losses in the event of nonperformance by counterparties to the swap agreements. This exposure is managed through diversification and the monitoring of the creditworthiness of the counterparties. There was $1.1 million of potential loss that the Company would incur on the interest rate swaps if the counterparties were to fail to meet their obligations under the agreements at June 30, 2015. Given the strong creditworthiness of the counterparties, management does not expect any of them to fail to meet their obligations. Additionally, the concentration of risk with any individual counterparty is not considered significant at June 30, 2015.

The interest rates on the private placement floating-rate senior notes is based on a fixed spread over LIBOR. Interest rates on the private placement floating-rate senior notes were 3.03 percent on the $100.0 million note and 3.26 percent on the $150.0 million note at June 30, 2015, after taking into account the effect of outstanding interest rate swap agreements. As of June 30, 2015, the weighted average interest rate was 1.88 percent for the revolving credit facility and term loan, after taking into account the effect of outstanding interest rate swap agreement. The interest rate under both facilities is variable based on LIBOR and Meredith's debt to trailing 12 month EBITDA (earnings before interest, taxes, depreciation, and amortization as defined in the debt agreement) ratio.

All of the Company's debt agreements include financial covenants and failure to comply with any such covenants could result in the debt becoming payable on demand. The most significant financial covenants require a ratio of debt to trailing 12 month EBITDA less than 3.75 and a ratio of EBITDA to interest expense of greater than 2.75. The Company was in compliance with these and all other financial covenants at June 30, 2015.

Interest expense related to long-term debt totaled $18.5 million in fiscal 2015, $10.9 million in fiscal 2014, and $12.7 million in fiscal 2013.

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At June 30, 2015, Meredith had additional credit available under the asset-backed bank facility of up to $20.0 million (depending on levels of accounts receivable) and had $122.5 million of credit available under the revolving credit facility with an option to request up to another $200.0 million. The commitment fee for the asset-backed bank facility ranges from 0.40 percent to 0.45 percent of the unused commitment based on utilization levels. The commitment fees for the revolving credit facility ranges from 0.125 percent to 0.25 percent of the unused commitment based on the Company's leverage ratio. Commitment fees paid in fiscal 2015 were not material.

7.  Income Taxes

The following table shows income tax expense (benefit) attributable to earnings before income taxes:

Years ended June 30,	2015		2014			2013
(In thousands)
Currently payable
Federal	$	39,429	$	37,615		$	30,604
State		4,583		2,764			1,419
Foreign		35		37			42
		44,047		40,416			32,065
Deferred
Federal		36,314		18,138			35,383
State		5,608		2,386			6,453
Foreign		—		(142	)		(147	)
		41,922		20,382			41,689
Income taxes	$	85,969	$	60,798		$	73,754

The differences between the statutory U.S. federal income tax rate and the effective tax rate were as follows:

Years ended June 30,	2015		2014		2013
U.S. statutory tax rate		35.0%		35.0%		35.0%
State income taxes, less federal income tax benefits		2.9		2.2		3.0
Settlements - audits / tax litigation		(0.1)		(0.3)		(1.6)
Restructuring of international operations		—		(2.5)		—
Other		0.8		0.5		1.0
Effective income tax rate		38.6%		34.9%		37.4%

The Company's effective tax rate was 38.6 percent in fiscal 2015, 34.9 percent in fiscal 2014, and 37.4 percent in fiscal 2013. The fiscal 2014 rate reflected tax benefits realized due to expiring federal and state statutes of limitations and federal tax benefits from the restructuring of Meredith's international operations. The fiscal 2013 rate reflected favorable adjustments primarily due to tax benefits from the resolution of state and local tax contingencies.

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The tax effects of temporary differences that gave rise to deferred tax assets and deferred tax liabilities were as follows:

June 30,	2015			2014
(In thousands)
Deferred tax assets
Accounts receivable allowances and return reserves	$	15,670		$	15,964
Compensation and benefits		35,850			34,320
Indirect benefit of uncertain state and foreign tax positions		9,925			10,875
All other assets		7,068			5,174
Total deferred tax assets		68,513			66,333
Valuation allowance		(1,808	)		(1,742	)
Net deferred tax assets		66,705			64,591
Deferred tax liabilities
Subscription acquisition costs		87,036			76,359
Accumulated depreciation and amortization		288,952			255,936
Deferred gains from dispositions		23,908			24,048
All other liabilities		6,842			4,907
Total deferred tax liabilities		406,738			361,250
Net deferred tax liability	$	340,033		$	296,659

The Company's deferred tax assets are more likely than not to be fully realized except for a valuation allowance of $1.8 million that was recorded for capital losses and certain net operating losses booked in fiscal 2014, fiscal 2013, and fiscal 2012. The net current portions of deferred tax assets and liabilities are included in accrued expenses-other taxes and expenses at June 30, 2015 and 2014, in the Consolidated Balance Sheets.

A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows:

Years ended June 30,	2015			2014
(In thousands)
Balance at beginning of year	$	37,995		$	42,402
Increases in tax positions for prior years		—			327
Decreases in tax positions for prior years		(2,028	)		(699	)
Increases in tax positions for current year		5,686			5,756
Settlements		(1,853	)		(652	)
Lapse in statute of limitations		(3,881	)		(9,139	)
Balance at end of year	$	35,919		$	37,995

The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was $27.3 million as of June 30, 2015, and $26.8 million as of June 30, 2014. The uncertain tax benefit recognized during fiscal 2015 from lapse in statute of limitations that related to income tax positions on temporary differences was $2.6 million. The Company recognizes interest and penalties related to unrecognized tax benefits as a component of income tax expense. The amount of accrued interest and penalties related to unrecognized tax benefits was $7.7 million and $7.6 million as of June 30, 2015 and 2014, respectively.

The total amount of unrecognized tax benefits at June 30, 2015, may change significantly within the next 12 months, decreasing by an estimated range of $2.3 million to $23.1 million. The change, if any, may result primarily from foreseeable federal and state examinations, ongoing federal and state examinations, anticipated state settlements, expiration of various statutes of limitation, the results of tax cases, or other regulatory developments.

29

The Company's federal tax returns have been audited through fiscal 2002, and are closed by expiration of the statute of limitations for fiscal 2003, fiscal 2004, and fiscal 2005. Fiscal 2006 through fiscal 2010 are under the jurisdiction of IRS Appeals, while fiscals 2011 and 2012 are currently under the jurisdiction of IRS Exam. The Company has various state income tax examinations ongoing and at various stages of completion, but generally the state income tax returns have been audited or closed to audit through fiscal 2005.

8.  Pension and Postretirement Benefit Plans

Savings and Investment Plan

Meredith maintains a 401(k) Savings and Investment Plan that permits eligible employees to contribute funds on a pretax basis. The plan allows employee contributions of up to 50 percent of eligible compensation subject to the maximum allowed under federal tax provisions. The Company matches 100 percent of the first 3 percent and 50 percent of the next 2 percent of employee contributions.

The 401(k) Savings and Investment Plan allows employees to choose among various investment options, including the Company's common stock, for both their contributions and the Company's matching contribution. Company contribution expense under this plan totaled $9.7 million in fiscal 2015, $9.3 million in fiscal 2014, and $8.7 million in fiscal 2013.

Pension and Postretirement Plans

Meredith has noncontributory pension plans covering substantially all employees. These plans include qualified (funded) plans as well as nonqualified (unfunded) plans. These plans provide participating employees with retirement benefits in accordance with benefit provision formulas. The nonqualified plans provide retirement benefits only to certain highly compensated employees. The Company also sponsors defined healthcare and life insurance plans that provide benefits to eligible retirees.

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Obligations and Funded Status

The following tables present changes in, and components of, the Company's net assets/liabilities for pension and other postretirement benefits:

	Pension						Postretirement
June 30,	2015			2014			2015			2014
(In thousands)
Change in benefit obligation
Benefit obligation, beginning of year	$	152,608		$	140,549		$	10,445		$	12,302
Service cost		12,173			10,196			117			170
Interest cost		5,582			5,604			407			480
Participant contributions		—			—			802			842
Plan amendments		—			915			—			(1,732	)
Actuarial loss (gain)		(1,996	)		4,083			(1,007	)		(114	)
Benefits paid (including lump sums)		(12,940	)		(8,739	)		(1,356	)		(1,503	)
Benefit obligation, end of year	$	155,427		$	152,608		$	9,408		$	10,445
Change in plan assets
Fair value of plan assets, beginning of year	$	145,179		$	128,267		$	—		$	—
Actual return on plan assets		3,857			25,117			—			—
Employer contributions		5,490			534			554			661
Participant contributions		—			—			802			842
Benefits paid (including lump sums)		(12,940	)		(8,739	)		(1,356	)		(1,503	)
Fair value of plan assets, end of year	$	141,586		$	145,179		$	—		$	—
Under funded status, end of year	$	(13,841	)	$	(7,429	)	$	(9,408	)	$	(10,445	)

Benefits paid directly from Meredith assets are included in both employer contributions and benefits paid.

Fair value measurements for pension assets as of June 30, 2015, were as follows:

June 30, 2015	Total Fair Value		Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)
Investments in registered investment companies 1	$	140,983	$	80,229	$	—	$	—
Pooled separate accounts 1		603		—		—		—
Total assets at fair value	$	141,586	$	80,229	$	—	$	—

¹ Certain investments that are measured at fair value using NAV per share have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented as the change in plan assets.

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Fair value measurements for pension assets as of June 30, 2014, were as follows:

June 30, 2014	Total Fair Value		Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)
Investments in registered investment companies 1	$	144,619	$	85,509	$	—	$	—
Pooled separate accounts 1		560		—		—		—
Total assets at fair value	$	145,179	$	85,509	$	—	$	—

 ¹ Certain investments that are measured at fair value using NAV per share have not been categorized in the fair value hierarchy. The fair   value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented as the   change in plan assets.

Refer to Note 14 for a discussion of the three levels in the hierarchy of fair values.

The following amounts are recognized in the Consolidated Balance Sheets:

	Pension						Postretirement
June 30,	2015			2014			2015			2014
(In thousands)
Other assets
Prepaid benefit cost	$	18,071		$	23,078		$	—		$	—
Accrued expenses-compensation and benefits
Accrued benefit liability		(2,780	)		(2,408	)		(700	)		(770	)
Other noncurrent liabilities
Accrued benefit liability		(29,132	)		(28,099	)		(8,708	)		(9,675	)
Net amount recognized, end of year	$	(13,841	)	$	(7,429	)	$	(9,408	)	$	(10,445	)

The accumulated benefit obligation for all defined benefit pension plans was $143.4 million and $138.3 million at June 30, 2015 and 2014, respectively.

The following table provides information about pension plans with projected benefit obligations and accumulated benefit obligations in excess of plan assets:

June 30,	2015		2014
(In thousands)
Projected benefit obligation	$	32,012	$	30,550
Accumulated benefit obligation		29,099		26,379
Fair value of plan assets		100		44

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Costs

The components of net periodic benefit costs recognized in the Consolidated Statements of Earnings were as follows:

	Pension									Postretirement
Years ended June 30,	2015			2014			2013			2015			2014			2013
(In thousands)
Components of net periodic benefit costs
Service cost	$	12,173		$	10,196		$	10,100		$	117		$	170		$	377
Interest cost		5,582			5,604			4,911			407			480			611
Expected return on plan assets		(11,037	)		(9,687	)		(9,465	)		—			—			—
Prior service cost (credit) amortization		225			391			359			(432	)		(440	)		(537	)
Actuarial loss (gain) amortization		667			2,030			3,250			(433	)		(365	)		—
Curtailment credit		—			—			—			—			(1,511	)		—
Net periodic benefit costs (credit)	$	7,610		$	8,534		$	9,155		$	(341	)	$	(1,666	)	$	451

Amounts recognized in the accumulated other comprehensive loss component of shareholders' equity for Company-sponsored plans were as follows:

June 30, 2015	Pension		Postretirement			Total
(In thousands)
Unrecognized net actuarial losses (gains), net of taxes	$	12,733	$	(2,070	)	$	10,663
Unrecognized prior service cost (credit), net of taxes		589		(716	)		(127	)
Total	$	13,322	$	(2,786	)	$	10,536

During fiscal 2016, the Company expects to recognize as part of its net periodic benefit costs $0.6 million of net actuarial losses and $0.2 million of prior-service costs for the pension plans, and $0.7 million of net actuarial gains and $0.4 million of prior service credit for the postretirement plan that are included, net of taxes, in the accumulated other comprehensive loss component of shareholders' equity at June 30, 2015.

Assumptions

Benefit obligations were determined using the following weighted average assumptions:

	Pension						Postretirement
June 30,	2015			2014			2015		2014
Weighted average assumptions
Discount rate		3.75	%		3.57	%		4.20%		4.00%
Rate of compensation increase		3.50	%		3.50	%		3.50%		3.50%
Rate of increase in health care cost levels
Initial level		NA			NA			7.00%		7.00%
Ultimate level		NA			NA			5.00%		5.00%
Years to ultimate level (in years)		NA			NA			6		4

NA-Not applicable

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Net periodic benefit costs were determined using the following weighted average assumptions:

	Pension									Postretirement
Years ended June 30,	2015			2014			2013			2015			2014			2013
Weighted average assumptions
Discount rate		3.57	%		3.92	%		3.50	%		4.00	%		4.50	%		4.10	%
Expected return on plan assets		8.00	%		8.00	%		8.00	%		NA			NA			NA
Rate of compensation increase		3.50	%		3.50	%		3.50	%		3.50	%		3.50	%		3.50	%
Rate of increase in health care cost levels
Initial level		NA			NA			NA			7.00	%		7.50	%		8.00	%
Ultimate level		NA			NA			NA			5.00	%		5.00	%		5.00	%
Years to ultimate level (in years)		NA			NA			NA			4			5			6
NA-Not applicable

The expected return on plan assets assumption was determined, with the assistance of the Company's investment consultants, based on a variety of factors. These factors include but are not limited to the plans' asset allocations, review of historical capital market performance, historical plan performance, current market factors such as inflation and interest rates, and a forecast of expected future asset returns. The Company reviews this long-term assumption on a periodic basis.

Assumed rates of increase in healthcare cost have a significant effect on the amounts reported for the healthcare plans. A change of one percentage point in the assumed healthcare cost trend rates would have the following effects:

	One Percentage Point Increase		One Percentage Point Decrease
(In thousands)
Effect on service and interest cost components for fiscal 2015	$	26	$	(26	)
Effect on postretirement benefit obligation as of June 30, 2015		408		(335	)

Plan Assets

The targeted and weighted average asset allocations by asset category for investments held by the Company's pension plans are as follows:

	2015 Allocation						2014 Allocation
June 30,	Target			Actual			Target			Actual
Domestic equity securities		35	%		35	%		35	%		36	%
Fixed income investments		30	%		29	%		30	%		27	%
International equity securities		25	%		25	%		25	%		26	%
Global equity securities		10	%		11	%		10	%		11	%
Fair value of plan assets		100	%		100	%		100	%		100	%

Meredith's investment policy seeks to maximize investment returns while balancing the Company's tolerance for risk. The plan fiduciaries oversee the investment allocation process. This includes selecting investment managers, setting long-term strategic targets, and monitoring asset allocations. Target allocation ranges are guidelines, not limitations, and plan fiduciaries may occasionally approve allocations above or below a target range, or elect to rebalance the portfolio within the targeted range. The investment portfolio contains a diversified blend of equity and fixed-income investments. Furthermore, equity investments are diversified across domestic and international stocks and between growth and value stocks and small and large capitalizations. The primary investment strategy currently employed is a dynamic target allocation method that periodically rebalances among various investment categories depending on the current funded position. This program is designed to actively move from return-seeking investments (such as equities) toward liability-hedging investments (such as long-duration fixed-income) as funding levels improve. The reverse effect occurs when funding levels decrease.

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Equity securities did not include any Meredith Corporation common or Class B stock at June 30, 2015 or 2014.

Cash Flows

Although we do not have a minimum funding requirement for the pension plans in fiscal 2016, the Company is currently determining what voluntary pension plan contributions, if any, will be made in fiscal 2016. Actual contributions will be dependent upon investment returns, changes in pension obligations, and other economic and regulatory factors. Meredith expects to contribute $0.7 million to its postretirement plan in fiscal 2016.

The following benefit payments, which reflect expected future service as appropriate, are expected to be paid:

Years ending June 30,	Pension Benefits		Postretirement Benefits
(In thousands)
2016	$	21,239	$	700
2017		25,555		732
2018		15,975		749
2019		15,409		744
2020		20,172		713
2021-2025		80,390		3,185

Other

The Company maintains collateral assignment split-dollar life insurance arrangements on certain key officers and retirees. The net periodic pension cost for fiscal 2015, 2014, and 2013 was $0.4 million, $0.3 million, and $0.3 million, respectively, and the accrued liability at June 30, 2015 and 2014, was $4.2 million and $4.1 million, respectively.

9.  Earnings per Share

The calculation of basic earnings per share for each period is based on the weighted average number of common and Class B shares outstanding during the period. The calculation of diluted earnings per share for each period is based on the weighted average number of common and Class B shares outstanding during the period plus the effect, if any, of dilutive common stock equivalent shares.

The following table presents the calculations of earnings per share:

Years ended June 30,	2015		2014		2013
(In thousands except per share data)
Net earnings	$	136,791	$	113,541	$	123,650
Basic average shares outstanding		44,522		44,636		44,455
Dilutive effect of stock options and equivalents		801		774		630
Diluted average shares outstanding		45,323		45,410		45,085
Earnings per share
Basic	$	3.07	$	2.54	$	2.78
Diluted		3.02		2.50		2.74

In addition, antidilutive options excluded from the above calculations totaled 0.9 million options for the year ended June 30, 2015 ($50.52 weighted average exercise price), 1.8 million options for the year ended June 30, 2014 ($50.54 weighted average exercise price), and 3.1 million options for the year ended June 30, 2013 ($46.56 weighted average exercise price).

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10.  Capital Stock

The Company has two classes of common stock outstanding: common and Class B. Each class receives equal dividends per share. Class B stock, which has 10 votes per share, is not transferable as Class B stock except to family members of the holder or certain other related entities. At any time, Class B stock is convertible, share for share, into common stock with one vote per share. Class B stock transferred to persons or entities not entitled to receive it as Class B stock will automatically be converted and issued as common stock to the transferee. The principal market for trading the Company's common stock is the New York Stock Exchange (trading symbol MDP). No separate public trading market exists for the Company's Class B stock.

From time to time, the Company's Board of Directors has authorized the repurchase of shares of the Company's common stock on the open market. In May 2014, the Board approved the repurchase of $100.0 million of shares. As of June 30, 2015, $97.0 million remained available under the current authorizations for future repurchases.

Repurchases of the Company's common and Class B stock are as follows:

Years ended June 30,	2015		2014		2013
(In thousands)
Number of shares		925		1,640		1,477
Cost at market value	$	46,764	$	78,226	$	54,734

Effective July 1, 2013, shares deemed to be delivered to the Company on tender of stock in payment for the exercise price of options are no longer included as part of our repurchase program and thus they do not reduce the repurchase authority granted by our Board. Shares delivered or deemed to be delivered to us in satisfaction of tax withholding on option exercises and the vesting of restricted shares continue to reduce the repurchase authority granted by our Board. Shares tendered for the exercise price of stock options were 0.7 million shares at of cost of $35.6 million in fiscal 2015 and 1.1 million shares at a cost of $54.1 million in fiscal 2014.

11.  Common Stock and Share-based Compensation Plans

Meredith has an employee stock purchase plan and a stock incentive plan, both of which are shareholder-approved. More detailed descriptions of these plans follows. Compensation expense recognized for these plans was $12.5 million in fiscal 2015, $12.2 million in fiscal 2014, and $11.5 million in fiscal 2013. The total income tax benefit recognized in earnings was $4.6 million in fiscal 2015, $4.5 million in fiscal 2014, and $4.2 million in fiscal 2013.

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Employee Stock Purchase Plan

Meredith has an employee stock purchase plan (ESPP) available to substantially all employees. The ESPP allows employees to purchase shares of Meredith common stock through payroll deductions at the lesser of 85 percent of the fair market value of the stock on either the first or last trading day of an offering period. The ESPP has quarterly offering periods. One million five hundred thousand common shares are authorized and approximately 290,000 shares remain available for issuance under the ESPP. Compensation cost for the ESPP is based on the present value of the cash discount and the fair value of the call option component as of the grant date using the Black-Scholes option-pricing model. The term of the option is three months, the term of the offering period. The expected stock price volatility was 37 percent in fiscal 2015, 36 percent in fiscal 2014, and 35 percent in fiscal 2013. Information about the shares issued under this plan is as follows:

Years ended June 30,	2015		2014		2013
Shares issued (in thousands)		72		86		130
Average fair value	$	7.52	$	7.59	$	5.55
Average purchase price		39.95		40.30		29.50
Average market price		50.83		48.36		38.56

Stock Incentive Plan

Meredith has a stock incentive plan that permits the Company to issue stock options, restricted stock, stock equivalent units, restricted stock units, and performance shares to key employees and directors of the Company. Approximately 8.7 million shares remained available for future awards under the plan as of June 30, 2015. Forfeited awards, shares deemed to be delivered to us on tender of stock in payment for the exercise price of options, and shares reacquired pursuant to tax withholding on option exercises and the vesting of restricted shares increase shares available for future awards. The plan is designed to provide an incentive to contribute to the achievement of long-range corporate goals; provide flexibility in motivating, attracting, and retaining employees; and to align more closely the employees' interests with those of shareholders.

The Company has awarded restricted shares of common stock and restricted stock units to eligible key employees and to non-employee directors under the plan. In addition, certain awards are granted based on specified levels of Company stock ownership. All awards have restriction periods tied primarily to employment and/or service. The awards generally vest over three or five years. The awards are recorded at the market value of traded shares on the date of the grant as unearned compensation. The initial values of the grants, net of estimated forfeitures, are amortized over the vesting periods.

The Company's restricted stock activity during the year ended June 30, 2015, was as follows:

Restricted Stock	Shares			Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
(Shares and Aggregate Intrinsic Value in thousands)
Nonvested at June 30, 2014		565		$	35.77
Granted		9			51.22
Vested		(186	)		26.72
Forfeited		(23	)		40.00
Nonvested at June 30, 2015		365			40.48	$	19,075

As of June 30, 2015, there was $2.3 million of unearned compensation cost related to restricted stock granted under the plan. That cost is expected to be recognized over a weighted average period of 1.3 years. The weighted average grant date fair value of restricted stock granted during the years ended June 30, 2015, 2014, and 2013 was $51.22, $48.01, and $34.69, respectively. The total fair value of shares vested during the years ended June 30, 2015, 2014, and 2013, was $7.8 million, $6.2 million, and $5.6 million, respectively.

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The Company's restricted stock unit activity during the year ended June 30, 2015, was as follows:

Restricted Stock Units	Shares			Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
(Shares and Aggregate Intrinsic Value in thousands)
Nonvested at June 30, 2014		—		$	—
Granted		173			46.21
Vested		(3	)		45.69
Forfeited		(11	)		46.19
Nonvested at June 30, 2015		159			46.22	$	8,314

As of June 30, 2015, there was $3.0 million of unearned compensation cost related to restricted stock units granted under the plan. That cost is expected to be recognized over a weighted average period of 2.2 years. The weighted average grant date fair value of restricted stock granted during the year ended June 30, 2015 was $46.21. The total fair value of shares vested during the year ended June 30, 2015 was $0.1 million.

Meredith also has outstanding stock equivalent units resulting from the deferral of compensation of employees and directors under various deferred compensation plans. The period of deferral is specified when the deferral election is made. These stock equivalent units are issued at the market price of the underlying stock on the date of deferral. In addition, shares of restricted stock may be converted to stock equivalent units upon vesting.

The following table summarizes the activity for stock equivalent units during the year ended June 30, 2015:

Stock Equivalent Units	Units			Weighted Average Issue Date Fair Value		Aggregate Intrinsic Value
(Units and Aggregate Intrinsic Value in thousands)
Balance at June 30, 2014		229		$	38.19
Additions		40			46.33
Converted to common stock		(4	)		28.88
Balance at June 30, 2015		265			36.12	$	4,251

The total intrinsic value of stock equivalent units converted to common stock was $0.1 million in fiscal 2015, $0.1 million in fiscal 2014, and zero for fiscal year 2013.

Meredith has granted nonqualified stock options to certain employees and directors under the plan. The grant date of options issued is the date the Compensation Committee of the Board of Directors approves the granting of the options. The exercise price of options granted is set at the fair value of the Company's common stock on the grant date. All options granted under the plan expire at the end of 10 years. Options granted vest three years from the date of grant.

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A summary of stock option activity and weighted average exercise prices follows:

Stock Options	Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
(Options and Aggregate Intrinsic Value in thousands)
Outstanding July 1, 2014		3,878		$	40.26
Granted		467			46.30
Exercised		(1,018	)		37.00
Forfeited		(658	)		48.40
Outstanding June 30, 2015		2,669			40.55		6.0	$	31,882
Exercisable June 30, 2015		1,225			39.15		3.7		16,856

The fair value of each option is estimated as of the date of grant using the Black-Scholes option-pricing model. Expected volatility is based on historical volatility of the Company's common stock and other factors. The expected life of options granted incorporates historical employee exercise and termination behavior. Different expected lives are used for separate groups of employees who have similar historical exercise patterns. The risk-free rate for periods that coincide with the expected life of the options is based on the U.S. Treasury yield curve in effect at the time of grant.

The following summarizes the assumptions used in determining the fair value of options granted:

Years ended June 30,	2015		2014		2013
Risk-free interest rate		1.4 - 2.8%		1.9 - 2.1%		0.4 - 1.3%
Expected dividend yield		4.00%		4.20%		5.00%
Expected option life (in years)		7 - 8		7 - 8		7 - 8
Expected stock price volatility		37%		36%		35%

The weighted average grant date fair value of options granted during the years ended June 30, 2015, 2014, and 2013, was $11.59, $11.41, and $6.62, respectively. The total intrinsic value of options exercised during the years ended June 30, 2015, 2014, and 2013 was $14.2 million, $9.6 million, and $12.0 million, respectively. As of June 30, 2015, there was $2.8 million in unrecognized compensation cost for stock options granted under the plan. This cost is expected to be recognized over a weighted average period of 1.7 years.

Cash received from option exercises under all share-based payment plans for the years ended June 30, 2015, 2014, and 2013 was $37.7 million, $54.5 million, and $34.7 million, respectively. The actual tax benefit realized for the tax deductions from option exercises totaled $5.5 million, $3.7 million, and $4.7 million, respectively, for the years ended June 30, 2015, 2014, and 2013.

12.  Commitments and Contingent Liabilities

The Company occupies certain facilities and sales offices and uses certain equipment under lease agreements. Rental expense for such leases was $20.1 million in fiscal 2015, $20.2 million in fiscal 2014, and $20.5 million in fiscal 2013.

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Below are the minimum rental commitments at June 30, 2015, under all noncancelable operating leases due in succeeding fiscal years:

Years ending June 30,
(In thousands)
2016	$	18,364
2017		17,341
2018		15,783
2019		14,065
2020		13,663
Thereafter		71,247
Total minimum rentals	$	150,463

Most of the future lease payments relate to the lease of office facilities in New York City through December 31, 2026. In the normal course of business, leases that expire are generally renewed or replaced by leases on similar properties.

The Company has recorded commitments for broadcast rights payable in future fiscal years. The Company also is obligated to make payments under contracts for broadcast rights not currently available for use and therefore not included in the consolidated financial statements. Such unavailable rights amounted to $30.3 million at June 30, 2015. The fair value of these commitments for unavailable broadcast rights, determined by the present value of future cash flows discounted at the Company's current borrowing rate, was $28.9 million at June 30, 2015.

The table shows broadcast rights payments due in succeeding fiscal years:

Years ending June 30,	Recorded Commitments		Unavailable Rights
(In thousands)
2016	$	4,776	$	10,874
2017		1,734		10,719
2018		654		7,174
2019		330		1,286
2020		142		208
Thereafter		138		35
Total amounts payable	$	7,774	$	30,296

The Company is involved in certain litigation and claims arising in the normal course of business. In the opinion of management, liabilities, if any, arising from existing litigation and claims are not expected to have a material effect on the Company's earnings, financial position, or liquidity.

13.  Other Comprehensive Income (Loss)

Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events and circumstances from nonowner sources. Comprehensive income (loss) includes net earnings as well as items of other comprehensive income (loss).

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The following table summarizes the items of other comprehensive income (loss) and the accumulated other comprehensive loss balances:

	Minimum Pension/Post Retirement Liability Adjustments			Interest Rate Swaps			Accumulated Other Comprehensive Income (Loss)
(In thousands)
Balance at June 30, 2012	$	(23,115	)	$	—		$	(23,115	)
Current-year adjustments, pretax		10,997			—			10,997
Tax expense		(4,223	)		—			(4,223	)
Other comprehensive loss		6,774			—			6,774
Balance at June 30, 2013		(16,341	)		—			(16,341	)
Current-year adjustments, pretax		12,310			—			12,310
Tax expense		(4,727	)		—			(4,727	)
Other comprehensive income		7,583			—			7,583
Balance at June 30, 2014		(8,758	)		—			(8,758	)
Current-year adjustments, pretax		(4,206	)		(2,109	)		(6,315	)
Tax benefit		1,615			810			2,425
Other comprehensive income		(2,591	)		(1,299	)		(3,890	)
Balance at June 30, 2015	$	(11,349	)	$	(1,299	)	$	(12,648	)

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14.  Fair Value Measurement

Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Specifically, it establishes a hierarchy prioritizing the use of inputs in valuation techniques. The defined levels within the hierarchy are as follows:

• Level 1	Quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2	Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable;
• Level 3	Assets or liabilities for which fair value is based on valuation models with significant unobservable pricing inputs and which result in the use of management estimates.

The following table sets forth the carrying value and the estimated fair value of the Company's financial instruments:

	June 30, 2015				June 30, 2014
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Broadcast rights payable	$	7,774	$	7,490	$	8,838	$	8,408
Long-term debt		795,000		797,121		715,000		717,032

The fair value of broadcast rights payable was determined using the present value of expected future cash flows discounted at the Company's current borrowing rate with inputs included in Level 3. The fair value of long-term debt was determined using the present value of expected future cash flows using borrowing rates currently available for debt with similar terms and maturities with inputs included in Level 2.

As of June 30, 2015, the Company had assets related to its qualified pension plans measured at fair value. The required disclosures regarding such assets are presented within Note 8. In addition, the Company has liabilities related to contingent consideration payables that are valued at estimated fair value as discussed in Note 2. The Company does not have any other assets or liabilities recognized at fair value.

The following table sets forth the liabilities measured at fair value on a recurring basis:

(In thousands)	June 30, 2015		June 30, 2014
Other assets
Interest rate swaps	$	1,139	$	—
Accrued expenses and other liabilities
Contingent consideration		800		50
Interest rate swaps		3,295		—
Other noncurrent liabilities
Contingent consideration		60,735		1,650

The fair value of interest rate swaps is determined based on discounted cash flows derived using market observable inputs including swap curves that are included in Level 2. The fair value of the contingent consideration is based on significant inputs not observable in the market and thus represents Level 3 measurements.

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The following table represents the changes in the fair value of Level 3 contingent consideration for the year ended June 30, 2015.

(in thousands)
Balance at beginning of year	$	1,700
Additions due to acquisitions		61,335
Change in present value of contingent consideration 1		(1,500	)
Balance at end of year	$	61,535

¹ Change in present value of contingent consideration is included in earning and comprised of changes in estimated earn out payments based on projections of performance and the amortization of the present value discount.

15.  Financial Information about Industry Segments

Meredith is a diversified media company focused primarily on the home and family marketplace. On the basis of products and services, the Company has established two reportable segments: national media and local media. The national media segment includes magazine publishing, customer relationship marketing, digital and mobile media, brand licensing, database-related activities, and other related operations. The local media segment consists primarily of the operations of network-affiliated television stations. Virtually all of the Company's revenues are generated in the U.S. and substantially all of the assets reside within the U.S. There are no material intersegment transactions.

There are two principal financial measures reported to the chief executive officer (the chief operating decision maker) for use in assessing segment performance and allocating resources. Those measures are operating profit and earnings before interest, taxes, depreciation, and amortization (EBITDA). Operating profit for segment reporting, disclosed below, is revenues less operating costs and unallocated corporate expenses. Segment operating expenses include allocations of certain centrally incurred costs such as employee benefits, occupancy, information systems, accounting services, internal legal staff, and human resources administration. These costs are allocated based on actual usage or other appropriate methods, primarily number of employees. Unallocated corporate expenses are corporate overhead expenses not attributable to the operating groups. Interest income and expense are not allocated to the segments. In accordance with authoritative guidance on disclosures about segments of an enterprise and related information, EBITDA is not presented below.

Significant non-cash items included in segment operating expenses other than depreciation and amortization of fixed and intangible assets is the amortization of broadcast rights in the local media segment. Broadcast rights amortization totaled $16.6 million in fiscal 2015, $8.8 million in fiscal 2014, and $9.7 million in fiscal 2013.

Segment assets include intangible, fixed, and all other non-cash assets identified with each segment. Jointly used assets such as office buildings and information technology equipment are allocated to the segments by appropriate methods, primarily number of employees. Unallocated corporate assets consist primarily of cash and cash items, assets allocated to or identified with corporate staff departments, and other miscellaneous assets not assigned to a segment.

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The following table presents financial information by segment:

Years ended June 30,	2015			2014			2013
(In thousands)
Revenues
National media	$	1,059,852		$	1,065,898		$	1,095,195
Local media		534,324			402,810			376,145
Total revenues	$	1,594,176		$	1,468,708		$	1,471,340
Segment profit
National media	$	122,681		$	113,113		$	137,985
Local media		162,677			113,060			124,116
Unallocated corporate		(43,246	)		(39,658	)		(51,267	)
Income from operations		242,112			186,515			210,834
Interest expense, net		(19,352	)		(12,176	)		(13,430	)
Earnings before income taxes	$	222,760		$	174,339		$	197,404
Depreciation and amortization
National media	$	17,186		$	29,455		$	19,199
Local media		38,779			28,815			24,471
Unallocated corporate		1,839			1,658			1,680
Total depreciation and amortization	$	57,804		$	59,928		$	45,350
Assets
National media	$	1,665,542		$	1,422,855		$	1,454,225
Local media		1,072,152			996,935			587,611
Unallocated corporate		105,588			124,010			98,223
Total assets	$	2,843,282		$	2,543,800		$	2,140,059
Capital expenditures
National media	$	4,829		$	5,491		$	6,455
Local media		23,224			16,578			14,688
Unallocated corporate		5,192			2,753			4,826
Total capital expenditures	$	33,245		$	24,822		$	25,969

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16.  Selected Quarterly Financial Data (unaudited)

Year ended June 30, 2015	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Total
(In thousands except per share data)
Revenues
National media	$	246,326		$	242,381		$	275,298		$	295,847		$	1,059,852
Local media		124,858			156,524			122,881			130,061			534,324
Total revenues	$	371,184		$	398,905		$	398,179		$	425,908		$	1,594,176
Operating profit
National media	$	28,895		$	26,107		$	23,460		$	44,219		$	122,681
Local media		36,312			54,986			31,420			39,959			162,677
Unallocated corporate		(12,355	)		(12,231	)		(7,774	)		(10,886	)		(43,246	)
Income from operations	$	52,852		$	68,862		$	47,106		$	73,292		$	242,112
Net earnings	$	29,365		$	39,591		$	25,256		$	42,579		$	136,791
Basic earnings per share		0.66			0.89			0.57			0.95			3.07
Diluted earnings per share		0.65			0.87			0.56			0.94			3.02
Dividends per share		0.4325			0.4325			0.4575			0.4575			1.7800

In the second quarter of fiscal 2015, the Company recorded a pre-tax restructuring charge of $6.7 million.

In the third quarter of fiscal 2015, the Company recorded a pre-tax restructuring charge of $9.9 million.

45

Year ended June 30, 2014	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Total
(In thousands except per share data)
Revenues
National media	$	266,899		$	249,694		$	269,680		$	279,625		$	1,065,898
Local media		89,553			104,354			97,734			111,169			402,810
Total revenues	$	356,452		$	354,048		$	367,414		$	390,794		$	1,468,708
Operating profit
National media	$	28,076		$	28,070		$	13,614		$	43,353		$	113,113
Local media		25,676			35,225			26,696			25,463			113,060
Unallocated corporate		(10,944	)		(11,394	)		(9,081	)		(8,239	)		(39,658	)
Income from operations	$	42,808		$	51,901		$	31,229		$	60,577		$	186,515
Net earnings	$	24,041		$	30,569		$	18,486		$	40,445		$	113,541
Basic earnings per share		0.54			0.68			0.41			0.91			2.54
Diluted earnings per share		0.53			0.67			0.41			0.89			2.50
Dividends per share		0.4075			0.4075			0.4325			0.4325			1.6800

In the second quarter of fiscal 2014, the Company recorded $1.6 million in acquisition transaction costs. Also in the second quarter, the Company recorded a reduction in contingent consideration payable of $1.1 million.

In the third quarter of fiscal 2014, the Company recorded a pre-tax restructuring charge of $20.8 million and acquisition transaction costs of $1.5 million. Also in the third quarter, the Company recorded a reduction in contingent consideration payable of $2.3 million and $1.4 million in reversals of excess restructuring reserves accrued in prior fiscal years.

In the fourth quarter of fiscal 2014, the Company recorded a pre-tax restructuring charge of $3.7 million and acquisition transaction costs $2.4 million. The Company recorded a reduction in contingent consideration payable of $2.3 million in the fourth quarter of fiscal 2014.

46 

EX-99.2

Exhibit 99.2

Index to Financial Statements
LIN Media LLC
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets	F-4
Consolidated Statements of Operations	F-5
Consolidated Statements of Comprehensive Income (Loss)	F-6
Consolidated Statements of Stockholders’ Equity (Deficit)	F-7
Consolidated Statements of Cash Flows	F-10
Notes to Consolidated Financial Statements	F-11
LIN Television Corporation
Report of Independent Registered Public Accounting Firm	F-59
Consolidated Balance Sheets	F-60
Consolidated Statements of Operations	F-61
Consolidated Statements of Comprehensive Income (Loss)	F-62
Consolidated Statements of Stockholders’ Equity (Deficit)	F-63
Consolidated Statements of Cash Flows	F-66
Notes to Consolidated Financial Statements	F-67

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of LIN Media LLC:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of LIN Media LLC and its subsidiaries at December 31, 2013 and December 31, 2012, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2013 in conformity with accounting principles generally accepted in the United States of America. 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 of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Hartford, Connecticut    

March 3, 2014, except for Note 21, as to which the date is June 13, 2014

Part I. Financial Information

Item 1.    Consolidated Financial Statements

Note: The information contained in this Item has been updated for the change to reportable segments as of January 1, 2014. Specifically, the following notes to our consolidated financial statements have been updated to reflect this change: Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies," Note 6 - "Intangible Assets," and Note 21 (Note 19 for LIN Television Corporation) - "Segment Reporting." This Item has not been updated for any other changes since the filing of the 2013 Annual Report on Form 10-K (the "10-K”). For significant developments since the filing of the 10-K, refer to LIN Media LLC's Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, Current Reports on Form 8-K and any other subsequent filings with the Securities Exchange Commission.

F-3

LIN Media LLC

Consolidated Balance Sheets

	December 31,
	2013			2012
	(in thousands, except share data)
ASSETS
Current assets:
Cash and cash equivalents	$	12,525		$	46,307
Accounts receivable, less allowance for doubtful accounts (2013—$3,188; 2012—$3,599)	145,309			126,150
Deferred income tax assets	6,898			—
Other current assets	15,201			6,863
Total current assets	179,933			179,320
Property and equipment, net	221,078			241,491
Deferred financing costs	16,448			19,135
Goodwill	203,528			192,514
Broadcast licenses	536,515			536,515
Other intangible assets, net	47,049			59,554
Other assets	12,299			12,885
Total assets (a)	$	1,216,850		$	1,241,414
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Current portion of long-term debt	$	17,364		$	10,756
Accounts payable	14,002			18,955
Income taxes payable	1,420			766
Accrued expenses	51,696			153,246
Deferred income tax liabilities	—			168,219
Program obligations	7,027			10,770
Total current liabilities	91,509			362,712
Long-term debt, excluding current portion	927,328			879,471
Deferred income tax liabilities	64,686			40,556
Program obligations	4,146			4,281
Other liabilities	27,209			42,716
Total liabilities (a)	1,114,878			1,329,736
Commitments and Contingencies (Note 13)
Redeemable noncontrolling interest	12,845			3,242
LIN Media LLC shareholders' equity (deficit):
Class A common shares, 100,000,000 shares authorized, Issued: 39,013,005 and 35,672,528 shares as of December 31, 2013 and 2012, respectively, Outstanding: 34,065,346 and 30,724,869 shares as of December 31, 2013 and 2012, respectively (b)	624,564			313
Class B common shares, 50,000,000 shares authorized, 20,901,726 and 23,401,726 shares as of December 31, 2013 and 2012, respectively, issued and outstanding; convertible into an equal number of shares of class A or class C common shares (b)	518,395			235
Class C common shares, 50,000,000 shares authorized, 2 shares as of December 31, 2013 and 2012, issued and outstanding; convertible into an equal number of shares of class A common shares	—			—
Treasury shares, 4,947,659 of class A common shares as of December 31, 2013 and 2012, at cost (b)	(21,984		)	(21,984		)
Additional paid-in capital (b)	—			1,129,691
Accumulated deficit	(1,006,322		)	(1,164,435		)
Accumulated other comprehensive loss	(25,526		)	(35,384		)
Total shareholders' equity (deficit)	89,127			(91,564		)
Total liabilities, redeemable noncontrolling interest and shareholders' equity (deficit)	$	1,216,850		$	1,241,414

_____________________________________________________________________

^(a)  Our consolidated assets as of December 31, 2013 and 2012 include total assets of $56,056 and $60,380, respectively, of variable interest entities ("VIEs") that can only be used to settle the obligations of the VIEs. These assets include broadcast licenses and other intangible assets of $44,677 and $46,604 and program rights of $2,186 and $2,060 as of December 31, 2013 and 2012, respectively. Our consolidated liabilities as of December 31, 2013 and 2012 include $4,126 and $4,577, respectively, of total liabilities of the VIEs for which the VIE's creditors have no recourse to the Company, including $2,727 and $4,152, respectively, of program obligations. See further description in Note 1—"Basis of Presentation and Summary of Significant Accounting Policies."

^(b)  In conjunction with the Merger of LIN TV with and into LIN LLC on July 30, 2013, LIN LLC was deemed the successor reporting entity to LIN TV. As such, the additional paid-in capital amount within LIN LLC's shareholders' equity as of December 31, 2013 has been allocated to the Class A and B share balances to conform to LIN LLC's basis of presentation as a limited liability company. For purposes of LIN TV's shareholders' deficit balance as of December 31, 2012, LIN TV's class A, B and C common shares had a par value of $0.01 per share that is not reflected as of December 31, 2013, as each share represents a limited liability interest in LIN LLC.

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

F-4

LIN Media LLC

Consolidated Statements of Operations

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except per share data)
Net revenues	$	652,363		$	553,462		$	400,003
Operating expenses:
Direct operating	251,078			160,222			130,618
Selling, general and administrative	162,550			125,267			103,770
Amortization of program rights	29,242			23,048			21,406
Corporate	41,377			34,246			26,481
Depreciation	46,854			32,149			26,246
Amortization of intangible assets	22,826			6,364			1,199
Restructuring	3,895			1,009			707
Contract termination costs (Note 12)	3,887			—			—
Loss from asset dispositions	710			96			472
Operating income	89,944			171,061			89,104
Other expense:
Interest expense, net	56,607			46,683			50,706
Share of loss in equity investments	56			98,309			4,957
Gain on derivative instruments	—			—			(1,960		)
Loss on extinguishment of debt	—			3,341			1,694
Other expense, net	2,100			237			51
Total other expense, net	58,763			148,570			55,448
Income before (benefit from) provision for income taxes	31,181			22,491			33,656
(Benefit from) provision for income taxes	(125,420		)	40,463			(16,045		)
Income (loss) from continuing operations	156,601			(17,972		)	49,701
Discontinued operations:
Loss from discontinued operations, net of a benefit from income taxes of $541 and $595 for the years ended December 31, 2012 and 2011, respectively	—			(1,018		)	(920		)
Gain on sale of discontinued operations, net of a provision for income taxes of $6,223 for the year ended December 31, 2012	—			11,389			—
Net income (loss)	156,601			(7,601		)	48,781
Net (loss) income attributable to noncontrolling interests	(1,512		)	(556		)	204
Net income (loss) attributable to LIN Media LLC	$	158,113		$	(7,045	)	$	48,577
Basic income (loss) per common share attributable to LIN Media LLC:
Income (loss) from continuing operations attributable to LIN Media LLC	$	3.02		$	(0.32	)	$	0.89
Loss from discontinued operations, net of tax	—			(0.02		)	(0.02		)
Gain on sale of discontinued operations, net of tax	—			0.21			—
Net income (loss) attributable to LIN Media LLC	$	3.02		$	(0.13	)	$	0.87
Weighted-average number of common shares outstanding used in calculating basic income (loss) per common share	52,439			54,130			55,768
Diluted income (loss) per common share attributable to LIN Media LLC:
Income (loss) from continuing operations attributable to LIN Media LLC	$	2.84		$	(0.32	)	$	0.87
Loss from discontinued operations, net of tax	—			(0.02		)	(0.02		)
Gain on sale of discontinued operations, net of tax	—			0.21			—
Net income (loss) attributable to LIN Media LLC	$	2.84		$	(0.13	)	$	0.85
Weighted-average number of common shares outstanding used in calculating diluted income (loss) per common share	55,639			54,130			57,079

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

F-5

LIN Media LLC

Consolidated Statements of Comprehensive Income (Loss)

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Net income (loss)	$	156,601		$	(7,601	)	$	48,781
Pension net gain (loss), net of tax of $5,705, $1,523 and $(7,291) for the years ended December 31, 2013, 2012 and 2011, respectively	8,738			2,424			(11,212		)
Amortization of pension net losses, net of tax of $734, $609 and $379 for the years ended December 31, 2013, 2012 and 2011, respectively, reclassified	1,120			969			374
Comprehensive income (loss)	166,459			(4,208		)	37,943
Comprehensive (loss) income attributable to noncontrolling interest	(1,512		)	(556		)	204
Comprehensive income (loss) attributable to LIN Media LLC	$	167,971		$	(3,652	)	$	37,739

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

F-6

LIN Media LLC

Consolidated Statement of Shareholders' Equity

(in thousands, except share data)

	Common Stock
	Class A			Class B					Class C			Treasury Shares (at cost)			Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Loss			Total Shareholders' Equity
	Shares	Amount		Shares		Amount			Shares	Amount
Balance at December 31, 2012	35,672,528	$	313	23,401,726		$	235		2	$	—	$	(21,984	)	$	1,129,691		$	(1,164,435	)	$	(35,384	)	$	(91,564	)
Pension liability adjustment, net of tax of $6,439	—	—		—		—			—	—		—			—			—			9,858			9,858
Issuance of class A common shares	840,477	395		—		—			—	—		—			1,450			—			—			1,845
Conversion of class B common shares to class A common shares	2,500,000	25		(2,500,000	)	(25		)	—	—		—						—			—			—
Tax benefit from exercise of share options	—	—		—		—			—	—		—			1,591			—			—			1,591
Share-based compensation	—	2,593		—		—			—	—		—			6,691			—			—			9,284
Net income	—	—		—		—			—	—		—			—			158,113			—			158,113
Effect of the Merger	—	621,238		—		518,185			—	—		—			(1,139,423		)	—			—			—
Balance at December 31, 2013	39,013,005	$	624,564	20,901,726		$	518,395		2	$	—	$	(21,984	)	$	—		$	(1,006,322	)	$	(25,526	)	$	89,127

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

F-7

LIN Media LLC

Consolidated Statement of Stockholders' Deficit

(in thousands, except share data)

	Common Shares
	Class A			Class B			Class C			Treasury Shares (at cost)			Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Loss			Total Stockholders' Deficit
	Shares	Amount		Shares	Amount		Shares	Amount
Balance at December 31, 2011	34,650,169	$	309	23,401,726	$	235	2	$	—	$	(10,598	)	$	1,121,589	$	(1,157,390	)	$	(38,777	)	$	(84,632	)
Pension liability adjustment, net of tax of $2,132	—	—		—	—		—	—		—			—		—			3,393			3,393
Issuance of class A common stock	1,022,359	4		—	—		—	—		—			1,310		—			—			1,314
Stock-based compensation	—	—		—	—		—	—		—			6,792		—			—			6,792
Purchase of LIN TV class A common stock	—	—		—	—		—	—		(11,386		)	—		—			—			(11,386		)
Net loss	—	—		—	—		—	—		—			—		(7,045		)	—			(7,045		)
Balance at December 31, 2012	35,672,528	$	313	23,401,726	$	235	2	$	—	$	(21,984	)	$	1,129,691	$	(1,164,435	)	$	(35,384	)	$	(91,564	)

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

F-8

LIN Media LLC

Consolidated Statement of Stockholders' Deficit

(in thousands, except share data)

	Common Stock
	Class A			Class B				Class C			Treasury Stock (at cost)			Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Loss			Total Stockholders' Deficit
	Shares	Amount		Shares		Amount		Shares	Amount
Balance at December 31, 2010	32,509,759	$	294	23,502,059		$	235	2	$	—	$	(7,869	)	$	1,109,814	$	(1,205,967	)	$	(27,939	)	$	(131,432	)
Pension liability adjustment, net of tax of $(6,912)	—	—		—		—		—	—		—			—		—			(10,838		)	(10,838		)
Issuance of LIN TV Corp. class A common stock	1,150,000	12		—		—		—	—		—			4,761		—			—			4,773
Purchase of LIN TV Corp. class A common stock											(2,729		)									(2,729		)
Stock-based compensation	890,077	3		—		—		—	—		—			7,014		—			—			7,017
Conversion of class B common stock to class A common stock	100,333	—		(100,333	)
Net income	—	—		—		—		—	—		—			—		48,577			—			48,577
Balance at December 31, 2011	34,650,169	$	309	23,401,726		$	235	2	$	—	$	(10,598	)	$	1,121,589	$	(1,157,390	)	$	(38,777	)	$	(84,632	)

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

F-9

LIN Media LLC

Consolidated Statements of Cash Flows

	Year ended December 31,
	2013			2012			2011
	(in thousands)
OPERATING ACTIVITIES:
Net income (loss)	$	156,601		$	(7,601	)	$	48,781
Loss from discontinued operations	—			1,018			920
Gain on sale of discontinued operations	—			(11,389		)	—
Adjustment to reconcile net income to net cash provided by operating activities:
Depreciation	46,854			32,149			26,246
Amortization of intangible assets	22,826			6,364			1,199
Amortization of financing costs and note discounts	3,638			2,589			3,755
Amortization of program rights	29,242			23,048			21,406
Cash payments for programming	(31,677		)	(24,258		)	(24,622		)
Loss on extinguishment of debt	—			1,830			1,694
Gain on derivative instruments	—			—			(1,960		)
Share of loss in equity investments	56			98,309			4,957
Deferred income taxes, net	(27,222		)	38,263			(16,586		)
Extinguishment of income tax liability related to the Merger	(131,481		)	—			—
Share-based compensation	9,374			6,857			6,176
Loss from asset dispositions	710			96			472
Other, net	(1,155		)	1,724			754
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(10,958		)	(33,403		)	(8,825		)
Other assets	(4,254		)	(2,146		)	(138		)
Accounts payable	(8,679		)	7,983			3,318
Income taxes payable	654			—			—
Accrued interest expense	4,327			1,746			(851		)
Other liabilities and accrued expenses	(9,889		)	6,256			(3,634		)
Net cash provided by operating activities, continuing operations	48,967			149,435			63,062
Net cash used in operating activities, discontinued operations	—			(2,736		)	(402		)
Net cash provided by operating activities	48,967			146,699			62,660
INVESTING ACTIVITIES:
Capital expenditures	(29,374		)	(28,230		)	(20,069		)
Change in restricted cash	—			255,159			(255,159		)
Payments for business combinations, net of cash acquired	(10,082		)	(358,495		)	(9,033		)
Proceeds from the sale of assets	86			79			74
Payments on derivative instruments	—			—			(2,020		)
Shortfall loans to joint venture with NBCUniversal	—			(2,292		)	(2,483		)
Capital contribution to joint venture with NBCUniversal	(100,000		)	—			—
Other investments, net	—			—			(375		)
Net cash used in investing activities, continuing operations	(139,370		)	(133,779		)	(289,065		)
Net cash provided by (used in) investing activities, discontinued operations	—			29,520			(115		)
Net cash used in investing activities	(139,370		)	(104,259		)	(289,180		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director share-based compensation	1,845			1,314			841
Tax benefit from exercises of share options	1,591			—			—
Proceeds from borrowings on long-term debt	139,000			328,333			417,695
Principal payments on long-term debt	(85,160		)	(322,179		)	(175,216		)
Payment of long-term debt issue costs	(655		)	(10,272		)	(7,662		)
Treasury shares purchased	—			(11,386		)	(2,729		)
Net cash provided by (used in) financing activities	56,621			(14,190		)	232,929
Net (decrease) increase in cash and cash equivalents	(33,782		)	28,250			6,409
Cash and cash equivalents at the beginning of the period	46,307			18,057			11,648
Cash and cash equivalents at the end of the period	$	12,525		$	46,307		$	18,057

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

F-10

LIN Media LLC

Notes to Consolidated Financial Statements

Note 1—Basis of Presentation and Summary of Significant Accounting Policies

Principles of Consolidation

LIN Media LLC ("LIN LLC"), together with its subsidiaries, including LIN Television Corporation ("LIN Television"), is a local multimedia company operating in the United States. LIN LLC and its subsidiaries are affiliates of Hicks, Muse & Co. Partners, L.P. ("HMC"). In these notes, the terms "Company," "we," "us" or "our" mean LIN LLC and all subsidiaries included in our consolidated financial statements.

On July 30, 2013, LIN TV Corp., a Delaware corporation (“LIN TV”), completed its merger with and into LIN LLC, a Delaware limited liability company and wholly owned subsidiary of LIN TV, with LIN LLC as the surviving entity (the “Merger”) pursuant to the Agreement and Plan of Merger, dated February 12, 2013, by and between LIN TV and LIN LLC (the “Merger Agreement”). Entry into the Merger Agreement had previously been announced by LIN TV on its Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on February 15, 2013.

LIN LLC filed a Current Report on Form 8-K on July 31, 2013 (the “Form 8-K”) for the purpose of establishing LIN LLC as the successor registrant to LIN TV pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and to disclose certain related matters, including the consummation of the Merger. Pursuant to Rule 12g-3(a) under the Exchange Act and in accordance with the filing of the Form 8-K, the class A common shares representing limited liability interests in LIN LLC, as the successor registrant to LIN TV, were deemed registered under Section 12(b) of the Exchange Act. References to "LIN LLC," "we," "us," or the "Company" in this Annual Report on Form 10-K that include any period at and before the effectiveness of the Merger shall be deemed to refer to LIN TV as the predecessor registrant to LIN LLC. For more information concerning the effects of the Merger and the succession of LIN LLC to LIN TV upon its effectiveness, please see the Form 8-K.

We conduct our business through LIN Television and its subsidiaries. Prior to the Merger, LIN TV had no operations or assets other than its investments in its subsidiaries. Subsequent to the Merger and consistent with its classification as a partnership for federal income tax purposes, LIN LLC has separate operations relating to the administration of the partnership. The consolidated financial statements of LIN LLC represent its own operations and the consolidated operations of LIN Television, which remains a corporation after the Merger.

We guarantee all of LIN Television's debt. All of the consolidated wholly-owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television's Senior Secured Credit Facility, 8³/₈% Senior Notes due 2018 (the "8³/₈% Senior Notes") and 6³/₈% Senior Notes due 2021 (the "6³/₈% Senior Notes") on a joint-and-several basis, subject to customary release provisions.

Our consolidated financial statements reflect the operations of WWHO-TV in Columbus, OH and WUPW-TV in Toledo, OH as discontinued for all periods presented. See Note 3—"Discontinued Operations" for further discussion of our discontinued operations.

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Certain changes in classifications have been made to the prior period financial statements to conform to the current financial statement presentation. Our significant accounting policies are described below.

The accompanying consolidated financial statements include the accounts of our Company, our wholly-owned and majority-owned and controlled subsidiaries, and variable interest entities ("VIEs") for which we are the primary beneficiary. We review all local marketing agreements ("LMAs"), shared services agreements ("SSAs") or joint sales agreements ("JSAs"), to evaluate whether consolidation of entities party to such arrangements is required. All intercompany accounts and transactions have been eliminated. We conduct our business through our subsidiaries and have no operations or assets other than our investment in our subsidiaries and equity-method investments.

As of January 1, 2014, we began operating under two segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites. Our Digital segment includes the operating results of our digital companies: LIN Digital LLC ("LIN Digital"), LIN Mobile, LLC ("LIN Mobile"), Nami Media, Inc. ("Nami Media"), HYFN, Inc. ("HYFN"), Dedicated Media, Inc. ("Dedicated Media"), and Federated Media Publishing LLC (acquired in February 2014) ("Federated Media"). Corporate and unallocated expenses primarily include our costs to operate as a public company and to operate our corporate locations. Corporate is not a reportable segment. We have retrospectively recast prior period disclosures to reflect this change in our

F-11

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

reportable segments. See Note 21 - “Segment Reporting” for further discussion. Prior to January 1, 2014, we had one reportable segment.

Joint Venture Sale Transaction

On February 12, 2013, we, along with our wholly-owned subsidiaries LIN Television and LIN Television of Texas, L.P., a Delaware limited partnership (“LIN Texas”), entered into and closed the transactions contemplated by a transaction agreement (the “Transaction Agreement”) with NBC Telemundo License LLC, a Delaware limited liability company (“NBC”), NBCU New LLC I, a Delaware limited liability company, NBCU New LLC II, a Delaware limited liability company, General Electric Company, a New York corporation (“GE”), General Electric Capital Corporation, a Delaware corporation (“GECC” and together with GE, the “GE Parties”), National Broadcasting Company Holding, Inc., a Delaware corporation, Comcast Corporation, a Pennsylvania corporation (“Comcast”), NBCUniversal Media, LLC, a Delaware limited liability company (“NBCUniversal”), Lone Star SPV, LLC, a Delaware limited liability company and Station Venture Holdings, LLC, a Delaware limited liability company (“SVH”). SVH held a 99.75% interest in Station Venture Operations, LP (“SVO”), which is the operating company that managed KXAS-TV and KNSD-TV, the television stations that comprised the joint venture. The Transaction Agreement effected a series of transactions related to the ownership and sale of LIN Texas's 20.38% equity interest in SVH, a joint venture in which NBC, an affiliate of NBCUniversal, held the remaining 79.62% equity interest (collectively, the “JV Sale Transaction”).

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

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

Pursuant to the JV Sale Transaction, in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations related to any shortfall funding agreements. Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal, and the LIN parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00. As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee.

We accrued for and expensed the $100 million capital contribution to SVH to secure the release of the GECC Guarantee and recorded the related tax effects of the JV Sale Transaction and the capital contribution in our consolidated financial statements as of December 31, 2012 because it represented a probable and estimable obligation of the Company. In February 2013, we entered into a $60 million incremental term loan facility and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million capital contribution. As a result of the JV Sale Transaction, after utilizing all of our available federal net operating loss carryforwards to offset the taxable gain recognized in such transaction, we had a $162.8 million income tax payable associated with this transaction remaining, $131.5 million of which was extinguished as a result of the closing of the transactions contemplated by the Merger Agreement further described below.

Concurrent with the closing of the JV Sale Transaction, LIN TV entered into the Merger Agreement with LIN LLC as described above. The Merger enabled the surviving entity to be classified as a partnership for federal income tax purposes and the change in classification was treated as a liquidation of LIN TV for federal income tax purposes, and LIN TV realized a capital loss in its 100% equity interest in LIN Television.

Based on an average of the opening and closing trading prices of LIN TV's class A common stock on the day of the Merger, LIN TV realized a capital loss in the amount of approximately $343 million, which represented the difference between its tax basis in the stock of LIN Television, and the fair market value of such stock as of July 30, 2013. The capital loss realized and existing net operating losses were used to offset a portion of the capital gain recognized in the JV Sale Transaction and, we realized cash savings of $131.5 million, resulting in a remaining tax liability of $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this tax liability during the fourth quarter of 2013.

F-12

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Variable Interest Entities

In determining whether we are the primary beneficiary of a VIE for financial reporting purposes, we consider whether we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and whether we have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. We consolidate VIEs when we are the primary beneficiary.

We have a JSA and an SSA with WBDT Television, LLC (“WBDT”), a third party licensee, for WBDT-TV in the Dayton, OH market. We also have JSAs and SSAs with affiliates of Vaughan Acquisition LLC (“Vaughan”), a third party licensee, for WTGS-TV in the Savannah, GA market, WYTV-TV in the Youngstown, OH market and KTKA-TV in the Topeka, KS market and SSAs with KASY-TV Licensee, LLC (“KASY”), a third-party licensee, for KWBQ-TV in the Santa Fe, NM market, KRWB-TV in the Roswell, NM market and KASY-TV in the Albuquerque, NM market. Under these agreements, we provide administrative services to these stations, have an obligation to reimburse certain of the stations' expenses, and we are compensated through a performance-based fee structure that provides us the benefit of certain returns from the operation of these stations.

We determined that WBDT, Vaughan and KASY are VIEs and as a result of the JSAs and/or SSAs, we have variable interests in these entities. We are the primary beneficiary of these entities, and therefore, we consolidate these entities within our consolidated financial statements.

The carrying amounts and classifications of the assets and liabilities of the variable interest entities described above, which have been included in our consolidating balance sheets as of December 31, 2013 and 2012 were as follows (in thousands):

	December 31,
	2013		2012
ASSETS
Current assets:
Cash and cash equivalents	$	278	$	418
Accounts receivable, net	6,345		6,021
Other assets	927		2,092
Total current assets	7,550		8,531
Property and equipment, net	2,469		3,190
Broadcast licenses and other intangible assets, net	44,677		46,604
Other assets	1,360		2,055
Total assets	$	56,056	$	60,380
LIABILITIES
Current liabilities:
Current portion of long-term debt	$	1,162	$	1,451
Accounts payable	63		—
Accrued expenses	1,336		425
Program obligations	1,303		2,185
Total current liabilities	3,864		4,061
Long-term debt, excluding current portion	3,005		3,950
Program obligations	1,424		1,967
Other liabilities	47,763		50,402
Total liabilities	$	56,056	$	60,380

The assets of our consolidated VIEs can only be used to settle the obligations of the VIEs, and may not be sold, or otherwise disposed of, except for assets sold or replaced with others of like kind or value. Other liabilities of $47.8 million and $50.4 million as of December 31, 2013 and 2012, respectively, serve to reduce the carrying value of the entities, and are eliminated in our consolidated financial statements. This reflects the fact that as of December 31, 2013 and 2012, LIN Television has an option that it may exercise if the Federal Communications Commission ("FCC") attribution rules change. The option would allow LIN Television to acquire the assets or member's interest of the VIE entities for a nominal exercise price, which is significantly less than the carrying value of their tangible and intangible net assets.

F-13

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the notes thereto. Our actual results could differ from these estimates. Estimates are used for the allowance for doubtful accounts in receivables, valuation of goodwill and intangible assets, assumptions used to determine fair value of financial instruments, amortization and impairment of program rights and intangible assets, share-based compensation and other long-term incentive compensation arrangements, pension costs, barter transactions, income taxes, employee medical insurance claims, useful lives of property and equipment, contingencies, litigation and net assets of businesses acquired.

Cash and cash equivalents

Cash equivalents consist of highly liquid, short-term investments that have an original maturity of three months or less when purchased. All of our available cash is on deposit with banking institutions that we believe to be financially sound. We had no material losses on our cash or cash equivalents during 2013.

Property and equipment

Property and equipment is recorded at cost and is depreciated using the straight-line method over the estimated useful lives of the assets, which are an average of 30 to 40 years for buildings and fixtures, and 3 to 15 years for broadcast and other equipment. Upon retirement or other disposition, the cost and related accumulated depreciation of the assets are removed from the accounts and the resulting gain or loss is included in consolidated net income or loss. Expenditures for maintenance and repairs, including expenditures for planned major maintenance activities, are expensed as incurred. We review our property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

Equity investments

Equity investments that we do not have a controlling interest in are accounted for using the equity method. Our share of the net income or loss for these investments, including any equity investment impairments or payments under related guarantees, is included in share of loss from equity investments on our consolidated statement of operations. We review our interest in our equity investments for impairment if there is a series of operating losses or other factors that may indicate that there is a decrease in the value of our investment that is other than temporary.

Revenue recognition

We recognize local, national and political advertising sales, net of agency commissions, during the period in which the advertisements or programs are aired on our television stations, and when payment is reasonably assured. Internet and mobile advertisement sales are recognized when the advertisement is displayed on our websites or the websites of our advertising network. We recognize retransmission consent fees in the period in which our service is delivered. Revenue generated by our digital companies is recognized over the service delivery period when necessary provisions of the contracts have been met. In addition, for the sale of third-party products and services by our digital companies, we evaluate whether it is appropriate to recognize revenue based on the gross amount billed to the customer or the net amount retained by us.

Barter transactions

We account for barter transactions at the fair value of the goods or services we receive from our customers, or the advertising time provided, whichever is more clearly indicative of fair value based on the judgment of our management. We record barter advertising revenue at the time the advertisement is aired and barter expense at the time the goods or services are used. We account for barter programs at fair value based on a calculation using the actual cash advertisements we sell within barter programs multiplied by one minus the program profit margin for similar syndicated programs where we pay cash to acquire the program rights. We record barter program revenue and expense when we air the barter program. We do not record barter revenue or expenses related to network programs. Barter revenue and expense included in the consolidated statements of operations are as follows (in thousands):

	Year Ended December 31,
	2013			2012			2011
Barter revenue	$	5,552		$	4,220		$	4,071
Barter expense	(5,455		)	(4,176		)	(3,967		)

F-14

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Advertising expense

Advertising costs are expensed as incurred. We incurred advertising costs in the amounts of $3.9 million, $3.1 million and $2.6 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Intangible assets

Intangible assets primarily include broadcast licenses, network affiliations, customer relationships, completed technology, non-compete agreements and goodwill.

We consider our broadcast licenses to be indefinite-lived intangible assets and as a result, we test the impairment of our broadcast licenses annually or whenever events or changes in circumstances indicate that such assets might be impaired. The use of an indefinite life for our broadcast licenses is based on our ability to renew the licenses and that such renewals generally may be obtained indefinitely and at little cost and that the technology used in broadcasting is not expected to be replaced in the foreseeable future. Therefore, cash flows derived from the broadcast licenses are expected to continue indefinitely. We proceed directly to the first step of the impairment test without attempting to qualitatively assess whether an impairment was more likely than not. The impairment test consists of a comparison of the fair value of broadcast licenses with their carrying amount on a station-by-station basis using a discounted cash-flow valuation method, assuming a hypothetical start-up scenario. The future value of our broadcast licenses could be significantly impaired by the loss of the corresponding network affiliation agreements. Accordingly, such an event could trigger an assessment of the carrying value of a broadcast license.

We test the impairment of goodwill annually or whenever events or changes in circumstances indicate that goodwill might be impaired. We proceed directly to the first step of the impairment test without attempting to qualitatively assess whether an impairment was more likely than not. Our reporting units are comprised of each of the markets in which our television stations operate, LIN Digital, Nami Media, Dedicated Media, Inc. ("Dedicated Media") and HYFN, Inc. ("HYFN"). The first step of the goodwill impairment test compares the fair value of a reporting unit with its carrying amount, including goodwill. The fair value of a reporting unit is determined through the use of a discounted cash flow analysis. The valuation assumptions used in the discounted cash flow model reflect historical and projected performance of the reporting unit and prevailing values in the markets for similar assets. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not considered impaired. If the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of goodwill with the carrying amount of that goodwill. The implied fair value of goodwill is determined by performing a hypothetical purchase price allocation, using the reporting unit's fair value (as determined in step one) as the purchase price. If the carrying amount of goodwill exceeds the implied fair value, an impairment charge is recognized in an amount equal to that excess, but not more than the carrying value of the goodwill. An impairment assessment could be triggered by a significant reduction, or a forecast of such reductions, in operating results or cash flows at one or more of our reporting units, a significant adverse change in the national or local advertising marketplaces in which our television stations operate, or by adverse changes to FCC ownership rules, among other factors. We recorded an impairment charge during 2011, which is more fully described in Note 6—"Intangible Assets."

Long-lived assets

We periodically evaluate the net realizable value of long-lived assets, including tangible and intangible assets, relying on a number of factors including operating results, business plans, economic projections and anticipated future cash flows. When evaluating assets for potential impairment, we first compare the carrying amount of the asset group to the estimated future cash flows associated with the asset group (undiscounted and without interest charges). If the estimated future cash flows used in this analysis are less than the carrying amount of the asset group, an impairment loss calculation is prepared. The impairment loss calculation compares the carrying amount of the asset group to the asset group's estimated future cash flows (discounted and with interest charges). If required, an impairment loss is recorded for the portion of the asset group's carrying value that exceeds the asset group's estimated future cash flows.

Program rights

Program rights are recorded as assets when the license period begins and the programs are delivered to our stations for broadcasting, at the gross amount of the related obligations. Costs incurred in connection with the purchase of programs to be broadcast within one year are classified as other current assets, while costs of those programs to be broadcast subsequently are considered non-current. Program costs are charged to operations over their estimated broadcast periods in a manner consistent with actual usage.

F-15

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

If the estimated net realizable value of acquired programming rights is less than unamortized cost (i.e. due to poor ratings), we would recognize an impairment charge to reduce the carrying value of the program rights to their net realizable value.

Program obligations are classified as current or non-current in accordance with the payment terms of the license agreement.

Share-based compensation

As of December 31, 2013, we have several share-based employee compensation plans, which are described more fully in Note 9—"Share-Based Compensation." We estimate the fair value of share option awards using a Black-Scholes valuation model. The Black-Scholes valuation model requires us to make assumptions and judgments about the variables used in the calculation, including the option's expected term, the expected volatility of the underlying shares and the number of share option awards that are expected to be forfeited. The expected term represents the weighted-average period of time that options granted are expected to be outstanding giving consideration to vesting schedules and our historical exercise patterns. Expected volatility is based on historical trends for our class A common shares over the expected term. Expected forfeitures are estimated using our historical experience. If future changes in estimates differ significantly from our current estimates, our future share-based compensation expense and results of operations could be materially impacted.

The following table presents the share-based compensation expense included in our consolidated statements of operations (in thousands):

	Year Ended December 31,
	2013		2012		2011
Direct operating	$	320	$	270	$	256
Selling, general and administrative	1,460		1,019		1,266
Corporate	7,594		5,568		4,654
Total share-based compensation	$	9,374	$	6,857	$	6,176

Our accounting policy is to follow the tax law ordering approach regarding net operating losses and determining when tax benefits are realized related to excess share option deductions and credited to equity.

Income taxes

Deferred income taxes are recognized based on temporary differences between the financial statement and the tax basis of assets and liabilities using statutory tax rates in effect in the years in which the temporary differences are expected to reverse. We consider future taxable income and feasible tax planning strategies in assessing the need for establishing or removing a valuation allowance. We record or subsequently remove a valuation allowance to reflect our deferred tax assets to an amount that is more likely than not to be realized. In the event that our determination changes regarding the realization of all or part of our deferred tax assets in the future, an adjustment to the deferred tax asset is recorded to our consolidated statement of operations in the period in which such a determination is made. Due to the change in tax structure as a result of the Merger, we reversed an $18.2 million valuation allowance and recognized a corresponding tax benefit during 2013. For further discussion regarding this reversal, see Note 14 - "Income Taxes."

When accounting for uncertainty in income taxes, we follow the prescribed recognition threshold and measurement methodology for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. We recognize interest and penalties related to uncertain tax positions as a component of income tax expense.

Concentration of credit risk

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents and trade receivables. Concentration of credit risk with respect to cash and cash equivalents and investments are limited as we maintain primary banking relationships with only large nationally recognized institutions. We evaluated the viability of these institutions as of December 31, 2013 and we believe our risk is minimal. Credit risk with respect to trade receivables is limited, as our trade receivables are primarily related to advertising revenues generated from a large diversified group of local and nationally recognized advertisers and advertising agencies. We do not require collateral or other security against trade receivable balances, however, we do maintain reserves for potential bad debt losses, which are based on historical bad debt experience and an assessment of specific risks, and such reserves and bad debts have been within management's expectations for all years presented.

F-16

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Earnings per share

Basic earnings per share ("EPS") is computed by dividing income attributable to common shareholders by the number of weighted-average outstanding common shares. Diluted EPS reflects the effect of the assumed exercise of share options and vesting of restricted shares only in the periods in which such effect would have been dilutive.

The following is a reconciliation of the weighted-average common shares outstanding for purposes of calculating basic and diluted income (loss) per common share (in thousands):

	Year Ended December 31,
	2013			2012			2011
Numerator for earnings per common share calculation:
Income (loss) from continuing operations	$	156,601		$	(17,972	)	$	49,701
Net (loss) income attributable to noncontrolling interest included in continuing operations	(1,512		)	(556		)	204
Income (loss) from continuing operations attributable to LIN LLC	158,113			(17,416		)	49,497
Income (loss) from discontinued operations, including gain on sale	—			10,371			(920		)
Net income (loss) attributable to LIN LLC	$	158,113		$	(7,045	)	$	48,577
Denominator for earnings per common share calculation:
Weighted-average common shares, basic	52,439			54,130			55,768
Effect of dilutive securities:
Share options and restricted shares	3,200			—			1,311
Weighted-average common shares, diluted	55,639			54,130			57,079

We apply the treasury stock method to measure the dilutive effect of our outstanding share options and restricted share awards and include the respective common share equivalents in the denominator of our diluted income per common share calculation. Potentially dilutive securities representing 0.1 million, 1.2 million, and 0.4 million weighted shares of common shares issuable for share options and restricted shares for the years ended December 31, 2013, 2012 and 2011, respectively, were excluded from the computation of diluted income (loss) per common share for these periods because their effect would have been anti-dilutive. The net income (loss) per share amounts are the same for our class A, class B and class C common shares because the holders of each class are legally entitled to equal per share amounts whether through distributions or in liquidation.

Fair value of financial instruments

Certain financial instruments, including cash and cash equivalents, investments, accounts receivable and accounts payable are carried in the consolidated financial statements at amounts that approximate fair value. For certain financial assets and liabilities recorded at fair value on a recurring basis we maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Derivative financial instruments

Derivatives are required to be recorded as assets or liabilities and measured at fair value. Gains or losses resulting from changes in the fair values of derivatives are recognized immediately or deferred, depending on the use of the derivative and whether or not it qualifies as a hedge. We have historically used derivative financial instruments in the management of our interest rate exposure for our long-term debt. In accordance with our interest rate risk management policy, we do not enter into derivative financial instruments unless there is an underlying exposure, and we do not enter into derivative financial instruments for speculative trading purposes.

Retirement plans

We have a defined benefit retirement plan covering certain of our employees. Our pension benefit obligations and related costs are calculated using prescribed actuarial concepts. Additionally, we record the unfunded status of our plan on our consolidated balance sheets. Effective April 1, 2009, this plan was frozen and we do not expect to make additional benefit accruals to this plan, however, we continue to fund our existing vested obligations.

F-17

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Redeemable noncontrolling interest

The following table presents the activity of the redeemable noncontrolling interest included in our consolidated balance sheets related to Nami Media, HYFN and Dedicated Media, which represents third parties’ proportionate share of our consolidated net assets (in thousands):

	Redeemable Noncontrolling Interest
Acquisition of redeemable noncontrolling interest	$	3,503
Net loss	(556		)
Share-based compensation	295
Balance as of December 31, 2012	3,242
Acquisition of redeemable noncontrolling interest	11,025
Net loss	(1,512		)
Share-based compensation	90
Balance as of December 31, 2013	$	12,845

Recently issued accounting pronouncements

In July 2013 the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” to eliminate diversity in practice. This ASU requires that companies net their unrecognized tax benefits against all same-jurisdiction net operating losses or tax credit carryforwards that would be used to settle the position with a tax authority. This new guidance is effective prospectively for annual reporting periods beginning on or after December 15, 2013 and interim periods therein. We prospectively adopted this guidance effective January 1, 2013 and it did not have a material impact on our financial statements.

In February 2013, the Financial Accounting Standards Board issued Accounting Standards Update No. 2013-2, “Reporting of Amounts Reclassified out of Accumulated Other Comprehensive Income,” which amends Accounting Standards Codification 220, “Comprehensive Income.” The amendments require an entity to disclose the impact of amounts reclassified out of accumulated other comprehensive income and into net income, by the respective line items of net income, if the amounts reclassified are reclassified to net income in their entirety in the same reporting period. The disclosure is required either on the face of the statement where net income is presented or in the notes. For amounts that are not reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. We prospectively adopted this guidance effective January 1, 2013 and it did not have a material impact on our financial statements.

In July 2012, there were revisions to the accounting standard for impairment tests of indefinite-lived intangible assets other than goodwill. Under the revised standard a company can first perform a qualitative assessment to determine whether further impairment testing of indefinite-lived intangible assets is necessary. A company can choose to perform the qualitative assessment on none, some, or all of its indefinite-lived intangible assets, and can also bypass the qualitative assessment and perform the quantitative impairment test for any indefinite-lived intangible in any period. The revised standard is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. We adopted this guidance effective January 1, 2013 and do not expect it to have a material impact on our impairment tests of indefinite-lived intangible assets.

Note 2—Acquisitions

Federated Media Publishing, Inc.

On February 3, 2014, LIN Digital Media LLC, a wholly owned subsidiary of LIN Television, acquired 100% of the capital stock of Federated Media Publishing, Inc. ("Federated Media"), which we subsequently converted into a Delaware limited liability company. Federated Media is a digital content and conversational marketing company that leverages the relationships and content from its publishing network to deliver contextually relevant advertising and conversational and engagement tools that reach agencies’ and brands’ targeted audiences across digital and social media platforms. The purchase price totaled $22.4 million plus an adjustment for working capital delivered at closing and was funded from cash on hand and amounts drawn on our revolving credit facility.

F-18

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

We are in the process of making preliminary estimates of the fair value of the assets acquired and liabilities assumed of Federated Media, utilizing information available at the time of this report and these estimates are subject to refinement until all pertinent information has been obtained. We expect to complete the process of finalizing the purchase accounting and final estimates of fair value of assets and liabilities during the twelve months following the acquisition.

Dedicated Media, Inc.

On April 9, 2013, LIN Television acquired a 60% interest (calculated on a fully diluted basis) in Dedicated Media, a multi-channel advertisement buying and optimization company. Dedicated Media employs new technologies to create, plan and execute digital marketing campaigns on behalf of its clients. The purchase price totaled $5.8 million, which was funded from cash on hand at the time of the acquisition.

Under the terms of our agreement with Dedicated Media, we agreed to purchase the remaining outstanding shares of Dedicated Media by no later than February 15, 2015 if Dedicated Media achieves both (i) a target earnings before interest, taxes, depreciation and amortization (“EBITDA”) and (ii) a target gross profit in 2014, as outlined in the purchase agreement. The purchase price of these shares is based on multiples of Dedicated Media’s 2014 EBITDA and gross profit. Our maximum potential obligation under the purchase agreement is $26 million. If Dedicated Media does not meet the target EBITDA or target gross profit in 2014, we have the option to purchase the remaining outstanding shares using the same purchase price multiple.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by us in the acquisition (in thousands):

Current assets	$	7,315
Equipment	99
Definite-lived intangible assets	4,620
Goodwill	1,854
Current liabilities	(4,302		)
Noncontrolling interest	(3,834		)
Total	$	5,752

The amount allocated to definite-lived intangible assets represents the estimated fair values of customer relationships of $3.9 million, completed technology of $0.5 million, and trademarks of $0.2 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 8 years for customer relationships, 4 years for completed technology and 2 years for trademarks.

HYFN, Inc.

On April 4, 2013, LIN Television acquired a 50.1% interest (calculated on a fully diluted basis) in HYFN, a full service digital advertising agency specializing in the planning, development, deployment and support for websites, mobile sites, interactive banners, games and various applications for multiple devices. The purchase price totaled $7.2 million, $6.9 million of which was funded from cash on hand and $0.3 million was accrued at the time of the acquisition and was subsequently paid in accordance with the provisions of the purchase agreement during the first quarter of 2014.

Under the terms of our agreement with HYFN, we agreed to purchase the remaining outstanding shares of HYFN by no later than February 15, 2016 if HYFN achieves both (i) a target EBITDA and (ii) target net revenues in 2015, as outlined in the transaction agreements. The purchase price of these shares is based on multiples of HYFN’s 2015 net revenue and EBITDA. Our maximum potential obligation under the terms of our agreement is approximately $62.4 million. If HYFN does not meet the target EBITDA or target net revenues in 2015, we have the option to purchase the remaining outstanding shares using the same purchase price multiple.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by us in the acquisition (in thousands):

F-19

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Current assets	$	3,759
Non-current assets	13
Equipment	179
Definite-lived intangible assets	3,580
Goodwill	9,160
Current liabilities	(920		)
Non-current liabilities	(1,361		)
Noncontrolling interest	(7,191		)
Total	$	7,219

The amount allocated to definite-lived intangible assets represents the estimated fair values of customer relationships of $2.4 million, completed technology of $1.1 million, and trademarks of $0.1 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 8 years for customer relationships, 3 years for completed technology and 3 years for trademarks.

Goodwill of $1.9 million and $9.2 million is the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired, and primarily represents the benefits of the incremental revenue we expect to generate from the acquisitions of Dedicated Media and HYFN, respectively. None of the goodwill recognized in connection with the acquisitions of Dedicated Media and HYFN is deductible for tax purposes.

Our obligations to purchase the noncontrolling interest holders’ shares of both Dedicated Media and HYFN are outside of our control, because they are based on the achievement of certain financial targets described above. Therefore, the noncontrolling interest related to Dedicated Media and HYFN as of December 31, 2013 has been reported as redeemable noncontrolling interest and classified as temporary equity on our consolidated balance sheets. As of the acquisition dates, the fair values of the noncontrolling interests were $3.8 million and $7.2 million for Dedicated Media and HYFN, respectively, and were measured based on the purchase prices for our 60% and 50.1% ownership interest in Dedicated Media and HYFN, respectively, and the net assets acquired as of the acquisition dates. As of December 31, 2013, we believe that achievement of the financial targets is not yet probable and therefore, have not reflected these obligations in our consolidated financial statements.

If we do not purchase the remaining outstanding shares of Dedicated Media or HYFN by the dates set forth in the respective purchase agreements, the noncontrolling interest holders have the right to purchase our interest. The purchase price of these shares is based on the same purchase price multiple described above and is exercisable only if the applicable financial targets are not met and we do not elect to purchase the remaining interest. The fair value of our elective purchase options, and the fair value of the options held by the noncontrolling interest holders is zero and no amounts related to these options are included in our consolidated financial statements as of December 31, 2013.

Net revenues and operating loss of HYFN and Dedicated Media included in our consolidated statements of operations for the year ended December 31, 2013 were $24.2 million and $(2.8) million, respectively.

New Vision Acquisition

On October 12, 2012, LIN Television completed its acquisition of television stations in eight markets that were previously owned by affiliates of New Vision Television, LLC ("New Vision") for $334.9 million, subject to certain post-closing adjustments, and including the assumption of $14.3 million of finance lease obligations. Concurrent with the acquisition, Vaughan, a third-party licensee, completed its acquisition of separately owned television stations (the "Vaughan Acquired Stations") in three markets for $4.6 million from PBC Broadcasting, LLC ("PBC").

LIN Television also agreed to provide certain services to the Vaughan Acquired Stations pursuant to SSAs with Vaughan. Under the SSAs with Vaughan, we provide sales, administrative and technical services, supporting the business and operation of the Vaughan Acquired Stations in exchange for commissions and fees that provide us the benefit of certain returns from the business of the Vaughan Acquired Stations.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by both us and Vaughan in the acquisition (in thousands):

F-20

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Program rights assets	$	2,040
Property and equipment	100,124
Broadcast licenses	133,120
Definite-lived intangible assets	55,837
Goodwill	65,024
Current liabilities	(417		)
Non-current liabilities	(2,239		)
Long-term debt assumed	(13,989		)
Total	$	339,500

The amount allocated to definite-lived intangible assets represents the estimated fair values of network affiliations of $30.8 million, favorable leases of $8.6 million, advertiser relationships of $6.1 million, retransmission consent agreements of $7 million, and other intangible assets of $3.3 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 2 years for network affiliations, 32 years for favorable leases, 10 years for advertiser relationships, 5 years for retransmission consent agreements, and a weighted average life of 6 years for other intangible assets.

The results of operations for the year ended December 31, 2012 include the results of the New Vision stations since October 12, 2012. Net revenues and operating income of the television stations acquired during 2012 included in our consolidated statements of operations for the year ended December 31, 2012 were $40 million and $11.2 million, respectively.

Pro Forma Information

The following table sets forth unaudited pro forma results of operations, assuming that the acquisition of the television stations from New Vision, along with transactions necessary to finance the acquisition, occurred on January 1, 2011 (in thousands):

	2012			2011
Net revenue	$	658,163		$	514,340
Net (loss) income	$	(11,720	)	$	23,950
Basic (loss) income per common share attributable to LIN LLC	$	(0.22	)	$	0.43
Diluted (loss) income per common share attributable to LIN LLC	$	(0.22	)	$	0.42

This pro forma financial information is based on historical results of operations, adjusted for the allocation of the purchase price and other acquisition accounting adjustments, and is not necessarily indicative of what our results would have been had we operated the businesses since January 1, 2011. The pro forma adjustments reflect depreciation expense, amortization of intangibles and amortization of program contract costs related to the fair value adjustments of the assets acquired, additional interest expense related to the financing of the transactions, exclusion of nonrecurring financing and transaction related costs and the related tax effects of the adjustments.

In connection with the acquisition of television stations from New Vision, we and New Vision incurred a combined total of $7.3 million of transaction related costs primarily related to legal and other professional services. These costs were not included in the 2012 pro forma amounts. The 2011 pro forma net income was adjusted to include these costs, as they are directly attributable to the acquisition.

ACME Television Acquisition

On December 10, 2012, LIN Television acquired certain assets of the ACME Television, LLC ("ACME") television stations KWBQ-TV, KRWB-TV and KASY-TV (collectively the "Acquired Stations"), each of which serves the Albuquerque-Santa Fe, NM market. KASY-TV Licensee, LLC ("KASY"), an unrelated third party, acquired the remaining assets of the Acquired Stations, including the FCC license. The aggregate purchase price for the Acquired Stations was $19 million, of which we paid approximately $17.3 million and KASY paid approximately $1.7 million.

LIN Television also agreed to provide certain services to the Acquired Stations pursuant to shared services arrangements with KASY. Under the shared services arrangements with KASY, we provide sales, administrative and technical services, supporting the business and operation of the Acquired Stations in exchange for commissions and fees that provide us the benefit of certain returns from the business of the Acquired Stations.

F-21

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by both us and KASY in the acquisitions (in thousands):

Current assets	$	1,656
Non-current assets	1,968
Other intangible assets	12,898
Goodwill	5,331
Non-current liabilities	(2,858		)
Total	$	18,995

Goodwill of $65 million and $5.3 million is the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired, and primarily represents the benefits of synergies and economies of scale we expect to realize from the acquisitions of the television stations from New Vision and ACME, respectively.  All of the goodwill recognized in connection with the acquisitions of New Vision and ACME is deductible for tax purposes.

During the year ended December 31, 2013, certain measurement period adjustments were made to the initial allocation performed in the fourth quarter of 2012 for the New Vision and ACME acquisitions, which were not material to the consolidated financial statements.

Nami Media, Inc.

On November 22, 2011, LIN Television acquired a 57.6% interest (a 50.1% interest calculated on a fully diluted basis) in Nami Media Inc. ("Nami Media"), a digital advertising management and technology company. During 2013, Nami Media did not achieve the minimum threshold of earnings before interest, taxes, depreciation and amortization ("EBITDA") required to obligate LIN LLC to acquire the remaining outstanding shares. As of the date of this report, we have not exercised our option to acquire the remaining outstanding shares.

Note 3—Discontinued Operations

WWHO-TV

On February 16, 2012, we completed the sale of substantially all of the assets of WWHO-TV, our CW affiliate serving Columbus, OH. During the year ended December 31, 2012, we recorded a loss on the sale of WWHO-TV of $0.4 million ($0.3 million, net of tax).

WUPW-TV

On April 21, 2012, we completed the sale of substantially all of the assets of WUPW-TV to WUPW, LLC. During the year ended December 31, 2012, we recorded a gain on the sale of WUPW-TV of $18 million ($11.7 million, net of tax).

The following presents summarized information for the discontinued operations as follows (in thousands):

	2012									2011
	WWHO- TV			WUPW- TV			Total			WWHO- TV			WUPW- TV		Total
Net revenues	$	440		$	2,193		$	2,633		$	4,236		$	7,585	$	11,821
Operating (loss) income	(393		)	(1,166		)	(1,559		)	(699		)	1,079		380
Net (loss) income	(252		)	(766		)	(1,018		)	(1,427		)	507		(920		)

Note 4—Investments

Joint Venture with NBCUniversal

As of December 31, 2012, we held a 20.38% interest in SVH, a joint venture with NBCUniversal, and accounted for our interest using the equity method, as we did not have a controlling interest. SVH held a 99.75% interest in SVO, which is the operating company that managed KXAS-TV and KNSD-TV, the television stations that comprised the joint venture.

F-22

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

As further described in Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies" and Note 13—"Commitments and Contingencies," on February 12, 2013, LIN TV, LIN Television, and LIN Texas entered into and simultaneously closed the transactions contemplated by the Transaction Agreement among subsidiaries of NBCUniversal, Comcast, the GE Parties, and SVH.

Pursuant to the JV Sale Transaction, in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations related to any shortfall funding agreements. Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal, and the LIN parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00. As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee.

The following table presents summarized financial information of SVH and SVO for the period from January 1, 2013 through February 12, 2013 and the years ending December 31, 2012 and 2011 (in thousands):

	January 1 - February 12,			Year Ended December 31,
	2013			2012			2011
SVO:
Net revenues	$	11,951		$	143,474		$	118,833
Operating expenses	(9,148		)	(79,124		)	(71,350		)
Net income before taxes	2,805			64,653			47,791
Net income after taxes	2,793			64,515			47,743
SVH:
Equity in income from limited partnership in SVO	$	2,786		$	64,354		$	47,624
Interest and other expense	(8,039		)	(69,365		)	(68,003		)
Net loss	(5,253		)	(5,011		)	(20,379		)
Cash distributions to SVH from SVO	6,905			55,025			53,846
Shortfall loans from LIN Television to SVH	—			2,292			2,483
Shortfall loans from General Electric Company ("GE") to SVH	—			8,954			9,701
	February 12,			December 31,
	2013 (2)			2012
SVH:
Cash and cash equivalents	$	6,905		$	—
Non-current assets	205,433			209,552
Current liabilities	8,155			544
Non-current liabilities(1)	865,354			864,927
Shortfall loans outstanding and accrued interest payable to LIN Television from SVH	10,159			10,080
Shortfall loans outstanding and accrued interest payable to NBCUniversal and General Electric from SVH	39,695			39,382

_______________________________________________________________________________

⁽¹⁾  See Note 13—"Commitments and Contingencies" for further description of the GECC Note. Non-current liabilities includes shortfall loans outstanding and accrued interest payable to the joint venture partners.

⁽²⁾  Represents balances prior to the effect of the JV Sale Transaction.

F-23

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

In 2008, we recorded an impairment charge that reduced the carrying value of our investment in SVH to $0. Subsequent to the reduction of the SVH carrying value to $0, and as a result of our guarantee of the GECC Note as further described in Note 13—"Commitments and Contingencies", we suspended recognition of equity method losses in our consolidated financial statements.

During the years ended December 31, 2012 and 2011, based on our estimate of our probable shortfall obligations to the joint venture, we recognized contingent liabilities of $4.2 million and $4.7 million, respectively, for the amounts that LIN Television expected to loan to SVH pursuant to the shortfall funding agreements with the GE Parties and NBCUniversal, as further described in Note 13—"Commitments and Contingencies." Because of uncertainty surrounding the joint venture's ability to repay shortfall loans, we concluded that it was more likely than not that the amounts recognized for accrued shortfall loans would not be recovered within a reasonable period of time, and concurrently recognized charges of $4.2 million and $4.7 million in 2012 and 2011, respectively, to reflect the impairment of the shortfall loans, which were classified within Share of loss in equity investments in our consolidated statement of operations. As a result of the JV Sale Transaction, as of February 12, 2013, we had no further shortfall funding obligations. Therefore, as of December 31, 2012, the remaining accrued shortfall funding liability of $6 million was also reversed and reflected in the Share of loss in equity investments line of our consolidated statement of operations.

Note 5—Property and Equipment

Property and equipment consisted of the following (in thousands):

	December 31,
	2013			2012
Land and land improvements	$	21,152		$	21,147
Buildings and fixtures	179,209			176,940
Broadcast equipment and other	319,912			311,907
Total property and equipment	520,273			509,994
Less accumulated depreciation	(299,195		)	(268,503		)
Property and equipment, net	$	221,078		$	241,491

We recorded depreciation expense of $46.9 million, $32.1 million and $26.2 million for the years ended December 31, 2013, 2012 and 2011, respectively.

F-24

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Note 6—Intangible Assets

The following table summarizes the carrying amount of each major class of intangible assets (in thousands):

	Weighted-Average Remaining Useful Life (in years)	December 31,
		2013			2012
Finite-Lived Intangible Assets:
Network affiliations	1	$	32,996		$	32,996
Customer relationships	9	14,941			8,631
Non-compete agreements	1	1,588			1,588
Completed technology	3	10,191			6,370
Favorable leases	31	8,573			8,573
Retransmission consent agreements	4	7,860			7,859
Other intangible assets	19	9,817			9,609
Accumulated amortization		(38,917		)	(16,072		)
Net finite-lived intangible assets		$	47,049		$	59,554
Indefinite-Lived Intangible Assets:
Broadcast licenses		$	536,515		$	536,515
Summary:
Goodwill		$	203,528		$	192,514
Broadcast licenses and finite-lived intangible assets, net		583,564			596,069
Total intangible assets		$	787,092		$	788,583

We recorded amortization expense of $22.8 million, $6.4 million and $1.2 million for the years ended December 31, 2013, 2012 and 2011, respectively.

The following table summarizes the projected aggregate amortization expense for the next five years and thereafter (in thousands):

	Projected Aggregate Amortization Expense
For the years ended December 31,
2014	$	15,971
2015	5,783
2016	4,980
2017	3,266
2018	2,042
Thereafter	15,007
Total	$	47,049

There were no events during 2013, 2012 and 2011 to warrant the performance of an interim impairment test of our indefinite-lived intangible assets. We recorded a $1.6 million impairment charge related to discontinued operations for the year ended December 31, 2011.

F-25

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

The changes in the carrying amount of goodwill for the years ended December 31, 2013 and 2012, respectively, are as follows (in thousands):

	Year Ended December 31,
	2013		2012
Broadcast:
Balance as of January 1, 2013 and 2012, respectively	$	185,237	$	114,882
Acquisitions	—		70,355
Balance as of December 31, 2013 and 2012, respectively	$	185,237	$	185,237
Digital:
Balance as of January 1, 2013 and 2012, respectively	$	7,277	$	7,187
Acquisitions/Adjustments	11,014		90
Balance as of December 31, 2013 and 2012, respectively	$	18,291	$	7,277
Total:
Balance as of January 1, 2013 and 2012, respectively	$	192,514	$	122,069
Acquisitions	11,014		70,445
Balance as of December 31, 2013 and 2012, respectively	$	203,528	$	192,514

Note 7—Debt

Debt consisted of the following (in thousands):

	December 31,
	2013		2012
Senior Secured Credit Facility:
Revolving credit loans	$	5,000	$	—
$118,750 and $125,000 Term loans, net of discount of $345 and $435 as of December 31, 2013 and December 31, 2012, respectively	118,405		124,565
$314,200 and $257,400 Incremental term loans, net of discount of $1,684 and $2,020 as of December 31, 2013 and December 31, 2012, respectively	312,516		255,380
83/8% Senior Notes due 2018	200,000		200,000
63/8% Senior Notes due 2021	290,000		290,000
Capital lease obligations	14,604		14,881
Other debt	4,167		5,401
Total debt	944,692		890,227
Less current portion	17,364		10,756
Total long-term debt	$	927,328	$	879,471

Senior Secured Credit Facility

Our senior secured credit facility is comprised of a six-year, $125 million tranche A term loan and a five-year, $75 million revolving credit facility, and bears interest at a rate based on, at our option, either a) the LIBOR interest rate, or b) the ABR rate, which is an interest rate that is equal to the greatest of (i) the Prime Rate, (ii) the Federal Funds Effective Rate plus 1/2 of 1 percent, and (iii) the one-month LIBOR rate plus 1%. In addition, the rate we select also bears an applicable margin based upon our Consolidated Senior Secured Leverage Ratio, currently set at 2.75% and 1.75% for LIBOR based loans and ABR rate loans, respectively. Following the issuance of this report during the first quarter of 2014, these rates will be 3% and 2% for LIBOR based loans and ABR rate loans, respectively. Lastly, the unused portion of the revolving credit facility is subject to a commitment fee

F-26

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

based upon our Consolidated Senior Secured Leverage Ratio, currently set at 0.375% for both LIBOR based loans and ABR rate loans and will increase to 0.5% following the issuance of this report during the first quarter of 2014 for both LIBOR based loans and ABR rate loans.

Our senior secured credit facility also includes a seven-year, $260 million tranche B incremental term loan facility and a $60 million tranche B-2 incremental term facility that was funded on February 12, 2013 in connection with the JV Sale Transaction, each of which is subject to the terms of our Credit Agreement. Borrowings under the incremental term loan facility were used (i) to pay the call price for our redemption of all of our remaining 6¹/₂% Senior Subordinated Notes, as described below, and (ii) to pay accrued interest, fees and expenses associated with the redemption. Borrowings under the incremental term loan facility bear interest at a rate based, at our option, on an adjusted LIBOR rate, plus an applicable margin of 3%; or an adjusted Base Rate, plus an applicable margin of 2%; provided that the adjusted LIBOR rate and the adjusted Base Rate shall at no time be less than 1% and 2%, respectively.

On December 24, 2012, we entered into an amendment to our Credit Agreement (the "Credit Agreement"), dated as of October 26, 2011, as amended on December 19, 2011, by and among LIN Television, JPMorgan Chase Bank, N.A., as Administrative Agent, and the banks and other financial institutions party thereto, which (1) replaced our $257.4 million tranche B term loan maturing in December 2018 with a new tranche B term loan of the same maturity which bears interest at a reduced rate and (2) made certain other changes to the Credit Agreement, including changes to the financial covenants therein that are favorable to LIN Television and its affiliates and (3) extended the maturity for a $60 million tranche of our revolving credit facility to October 2017 and on May 9, 2013, we extended the maturity date of the remaining $15 million tranche of our revolving credit facility to October 2017. We paid customary fees and expenses in connection with the closing of these amendments of $1.7 million. As a result of these amendments, we recorded a loss on extinguishment of debt of $1.2 million associated with a write-down of deferred financing fees and unamortized discount to our consolidated statement of operations during the year ended December 31, 2012.

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

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

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

The Credit Agreement governing our senior secured credit facility also requires on an annual basis, following the delivery of our year-end financial statements, and commencing after the year ended December 31, 2012, mandatory prepayments of principal of the term loans based on a computation of excess cash flow for the preceding fiscal year, as more fully described in the Credit Agreement. However, based on the excess cash flow computation for the year ended December 31, 2013, we will not be required to make such prepayments during the year ending December 31, 2014.

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

F-27

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

The following table summarizes certain key terms including the LIBOR-based borrowing rates of our senior secured credit facility as of December 31, 2013 (in thousands):

	Credit Facility
	Revolving Facility			Term Loans			Incremental Term Loans
Final maturity date	10/26/2017			10/26/2017			12/21/2018
Available balance as of December 31, 2013	$	70,000		$	—		$	—
Interest rates as of December 31, 2013:
Interest rate	0.17		%	0.17		%	1.00		%
Applicable margin	2.75		%	2.75		%	3.00		%
Total	2.92		%	2.92		%	4.00		%

2009 Senior Secured Credit Facility

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

8³/₈% Senior Notes

	83/8% Senior Notes
Final maturity date	4/15/2018
Annual interest rate	8.375%
Payable semi-annually in arrears	April 15th
	October 15th

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

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

6³/8% Senior Notes

	63/8% Senior Notes
Final maturity date	1/15/2021
Annual interest rate	6.375%
Payable semi-annually in arrears	January 15th
	July 15th

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

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

F-28

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

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

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

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

Capital Lease Obligations

As part of the transactions further described in Note 2—"Acquisitions," we assumed $15.1 million in capital lease obligations related to buildings and equipment. These leases mature over a period of 4 to 19 years and are payable in monthly installments. The total outstanding balance of these capital lease obligations was $14.6 million as of December 31, 2013. LIN Television fully and unconditionally guarantees these lease obligations.

Other Debt

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

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

During the year ended December 31, 2011, WBDT, a consolidated VIE, entered into a term loan with an unrelated third party in an original principal amount of $0.9 million to fund a portion of the purchase price for the acquisition of certain assets of WBDT-TV. This term loan matures in equal quarterly installments through May 2016. LIN Television fully and unconditionally guarantees this loan.

Repayment of Principal

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

F-29

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

	Revolving Facilities			Term Loans		Incremental Term Loans		83/8% Senior Notes		63/8% Senior Notes		Capital Leases		Other Debt		Total
Final maturity date	10/26/2017			10/26/2017		12/21/2018		4/15/2018		1/15/2021		Various		Various
2014	$	—		$	12,500	$	3,200	$	—	$	—	$	502	$	1,162	$	17,364
2015	—			18,750		3,200		—		—		528		1,162		23,640
2016	—			25,000		3,200		—		—		620		1,024		29,844
2017	5,000		(1)	62,500		3,200		—		—		577		819		72,096
2018	—			—		301,400		200,000		—		609		—		502,009
2019 and thereafter	—			—		—		—		290,000		11,768		—		301,768
Total	$	5,000		$	118,750	$	314,200	$	200,000	$	290,000	$	14,604	$	4,167	$	946,721

_______________________________________________________________________________

⁽¹⁾  An additional $25 million was outstanding on our revolving credit facility as of the date of this report and is not reflected in our balance sheet as of December 31, 2013.

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

	December 31, 2013				December 31, 2012
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(in thousands)
Revolving credit loans	$	5,000	$	5,000	$	—	$	—
Term loans	430,921		432,105		379,945		380,599
Senior notes	490,000		512,983		490,000		524,500
Other debt	4,167		4,167		5,401		5,401
Total	$	930,088	$	954,255	$	875,346	$	910,500

Note 8—Derivative Financial Instruments

We have historically used derivative financial instruments in the management of our interest rate exposure for our long-term debt. In accordance with our interest rate risk management policy, we do not enter into derivative instruments unless there is an underlying exposure, and we do not enter into derivative financial instruments for speculative trading purposes.

During the second quarter of 2006, we entered into a contract to hedge a notional amount of the declining balances of our term loans under our prior senior secured credit facility (the "2006 interest rate hedge") to mitigate changes in our cash flows resulting from fluctuations in interest rates. The 2006 interest rate hedge was historically designated as a cash flow hedge, however, as a result of a repayment of $45.9 million of principal on our term loans under our 2009 senior secured credit facility during 2010, the 2006 interest rate hedge ceased to be highly effective in hedging the variable rate cash flows. As a result, all changes in fair value were recorded in our consolidated statement of operations, including a gain of approximately $2 million for the year ended December 31, 2011.

The 2006 interest rate hedge expired on November 4, 2011. Accordingly, there are no amounts related to the 2006 interest rate hedge included in our consolidated balance sheets as of December 31, 2013 and 2012.

As of December 31, 2013, we have no derivative contracts outstanding.

F-30

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Note 9—Share-Based Compensation

We have several share-based compensation plans, including our 1998 Option Plan, the Amended and Restated 2002 Stock Plan and the Amended and Restated 2002 Non-Employee Director Stock Plan (collectively, the "Stock Plans"), that permit us to grant non-qualified options in our class A common shares or restricted share awards, to certain directors, officers and key employees of our Company.

Options granted under the Stock Plans vest over a four-year service period, unless otherwise designated by the Compensation Committee upon grant. Options expire ten years from the date of grant. We issue new shares of our class A common shares when options are exercised or from shares that we repurchased pursuant to our Board authorized share repurchase program as further described in Note 11—"Shareholders' Equity." Restricted share awards vest over a service period designated by the Compensation Committee upon grant. There were 6,787,940 shares authorized for grant under the various Stock Plans and 2,375,605 shares available for future grant as of December 31, 2013. Both the shares authorized and shares available exclude 1,552,983 shares under plans in effect prior to 2002 from which we do not intend to re-grant and consider unavailable for future grants.

The following table presents the share-based compensation expense included in our consolidated statements of operations as follows (in thousands):

	Year Ended December 31,
	2013		2012		2011
Employee share options	$	2,933	$	1,868	$	1,492
Restricted share awards	6,348		4,896		4,320
Modifications to share option agreements	93		93		364
Total share-based compensation	$	9,374	$	6,857	$	6,176

We did not capitalize any share-based compensation expense for the years ended December 31, 2013, 2012 and 2011.

We have not yet recognized compensation expense relating to unvested employee share options and restricted share awards of $2.6 million and $14 million, respectively, which will be recognized over a weighted-average future period of approximately 1.3 years and 1.7 years, respectively.

During the year ended December 31, 2013, we received $1.4 million from the exercise of share options and $0.4 million from the purchase of our class A common stock pursuant to our employee stock purchase plan ("ESPP"), which terminated upon consummation of the Merger.

Share Options

The following table provides additional information regarding our share options for the year ended December 31, 2013 as follows (in thousands, except per share data):

	Shares		Weighted- Average Exercise Price Per Share
Outstanding at the beginning of the year	4,894		$	3.42
Granted during the year	110		12.29
Exercised or converted during the year	(420	)	3.23
Forfeited during the year	(163	)	5.43
Expired during the year	(9	)	3.57
Outstanding at the end of the year	4,412		3.58
Exercisable or convertible at the end of the year	3,304		2.79

As of December 31, 2013, the weighted-average remaining contractual life of the options outstanding and the options exercisable was 6.1 years and 5.3 years, respectively. Additionally, as of December 31, 2013, the aggregate intrinsic value of the options outstanding and the options exercisable was $110.7 million and $85.5 million, respectively. The intrinsic value in the table

F-31

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

above represents the total pre-tax intrinsic value based on our closing price as of December 31, 2013, which would have been received by the option holders had all option holders exercised their options and immediately sold their shares on that date.

The fair value of each share option grant or modification is estimated on the date of grant or modification using a Black-Scholes valuation model, which incorporates the following assumptions:

	Year Ended December 31,
	2013	2012	2011
Expected term(1)	5 to 6 years	5 to 6 years	5 to 6 years
Expected volatility(2)	95% to 96%	98% to 99%	97% to 99%
Expected dividends	$—	$—	$—
Risk-free rate(3)	0.8% to 1.2%	0.6% to 1.1%	0.9% to 2.6%

_______________________________________________________________________________

⁽¹⁾  The expected term was estimated using our historical experience.

⁽²⁾  Expected volatility is based on historical trends for our class A common shares over the expected term.

⁽³⁾  The risk-free interest rate for each grant is equal to the U.S. Treasury yield curve in effect at the time of grant for instruments with a similar expected life.

During the years ended December 31, 2013, 2012 and 2011, we recognized share-based compensation expense for a modification to our share option agreements of $0.1 million, $0.1 million and $0.4 million, respectively, as a result of an exchange offer we completed in 2009.

Restricted Share Awards

The following table provides additional information regarding the restricted share awards for the year ended December 31, 2013 (in thousands, except per share data):

	Shares		Weighted- Average Price Per Share
Unvested at the beginning of the year	2,294		$	5.98
Granted during the year	582		18.89
Vested during the year	(960	)	6.00
Forfeited during the year	(205	)	5.87
Unvested at the end of the year	1,711		10.37

The following table provides further information for both our restricted share awards and share option awards (in thousands):

	Year Ended December 31,
	2013		2012		2011
Total fair value of options and awards granted	$	12,349	$	10,347	$	4,983
Total intrinsic value of options exercised	5,136		865		225
Total fair value of awards vested	18,050		7,718		7,522

Employee Stock Purchase Plan

As a result of the Merger, the ESPP was terminated, effective July 30, 2013. Prior to this, under the terms of our ESPP, our eligible employees could elect to have up to 10% of eligible compensation deducted from their pay to purchase our class A common stock. The purchase price of each share was 85% of the average of the high and low per share trading price of our class A common stock on the NYSE on the last trading day of each month during the offering period. During the year ended December 31, 2013, 2012 and 2011, employees purchased 42,734, 173,244 and 187,350 shares, respectively, at a weighted-average price of $10.05, $3.55 and $3.38, respectively.

F-32

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Note 10—Retirement Plans

401(k) Plan

We provide a defined contribution plan ("401(k) Plan") for eligible employees. Effective January 1, 2010, we began making a 3% non-elective contribution for all eligible employees, which vests 100% after two years of service. We contributed $4.8 million, $3.9 million and $3.6 million to the 401(k) Plan in the years ended December 31, 2013, 2012 and 2011, respectively.

Supplemental Income Deferral Plan

Effective July 1, 2010, we also made available to certain employees, including our executive officers, the LIN Television Corporation Supplemental Income Deferral Plan ("SIDP"). This plan provides benefits to highly compensated employees in circumstances in which the maximum limits established under the Employee Retirement Income Security Act of 1974 ("ERISA") and the Internal Revenue Code prevent them from receiving Company contributions. We contributed $0.5 million, $0.5 million and $0.2 million to this plan during the years ended December 31, 2013, 2012 and 2011, respectively.

The SIDP also allows eligible executive officers to defer 5%- 80% of their base salaries and 5%- 100% of their annual non-equity incentive awards on a tax-deferred basis and receive tax-deferred market-based growth. During 2013, the Company made contributions to the SIDP for each of the named executive officers in amounts equal to 5% of their base salary and non-equity incentive plan compensation.

Retirement Plans

We have historically provided defined benefit retirement plans to our employees who did not receive matching contributions from our Company to their 401(k) Plan accounts. Our defined benefit plans were non-contributory plans under which we made contributions either to: a) traditional plan participants based on periodic actuarial valuations, which are expensed over the expected average remaining service lives of current employees through the LIN Television Corporation Retirement Plan ("Retirement Plan"); or b) cash balance plan participants based on 5% of each participant's eligible compensation through the Supplemental Benefit Retirement Plan of LIN Television Corporation ("SERP").

Effective April 1, 2009, these plan were frozen and we do not expect to make additional benefit accruals to these plans, however we continue to fund our existing vested obligations. We contributed $5.4 million, $7.4 million and $5.4 million to our pension plans during the years ended December 31, 2013, 2012 and 2011, respectively. We anticipate contributing $5.7 million to the plans in 2014.

We record the unfunded status of our defined benefit plans as a liability. For the years ended December 31, 2013 and December 31, 2012, each plan was underfunded. The plan assets and benefit obligations of our defined benefit plans are recorded at fair value. Information regarding the change in the projected benefit obligation, the accumulated benefit obligation and the change in the fair value of plan assets for our traditional defined benefit plan and our cash balance plan are as follows (in thousands):

F-33

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

	Year Ended December 31,
	2013			2012
Change in projected benefit obligation
Projected benefit obligation, beginning of period	$	134,969		$	133,047
Service cost	—			—
Interest cost	5,259			5,379
Actuarial (gain) loss	(10,282		)	1,485
Benefits paid	(4,943		)	(4,942		)
Curtailment	—			—
Projected benefit obligation, end of period	$	125,003		$	134,969
Accumulated benefit obligation	$	125,003		$	134,969
Change in plan assets
Fair value of plan assets, beginning of period	$	96,412		$	82,314
Actual return on plan assets	10,611			11,621
Employer contributions	5,359			7,419
Benefits paid	(4,943		)	(4,942		)
Fair value of plan assets, end of period	$	107,439		$	96,412
Unfunded status of the plan	$	(17,564	)	$	(38,557	)
Total amount recognized as accrued benefit liability	$	(17,564	)	$	(38,557	)

The following table includes the pension related accounts recognized on our consolidated balance sheets and the components of accumulated other comprehensive loss related to the net periodic pension benefit costs (in thousands):

	December 31,
	2013			2012
Other accrued expenses (current)	$	(695	)	$	(373	)
Other liabilities (long-term)	(16,869		)	(38,184		)
Total amount recognized as accrued pension benefit liability	$	(17,564	)	$	(38,557	)
Accumulated other comprehensive loss:
Net loss	$	32,681		$	48,978
Tax benefit	12,915			19,354
Net loss, net of tax benefit	19,766			29,624
Pension tax liability	5,760			5,760
Accumulated other comprehensive loss related to net periodic pension benefit cost	$	25,526		$	35,384

The total net loss of $32.7 million for the year ending December 31, 2013 relates to deferred actuarial losses from changes in discount rates, differences between actual and assumed asset returns, and differences between actual and assumed demographic experience (rates of turnover, retirement rates, mortality rates and prior to the plan freeze, rates of compensation increases). During 2014, we expect to amortize net losses of $1.3 million, which are included in accumulated other comprehensive loss as of December 31, 2013.

F-34

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

The following table includes other changes in plan assets and benefit obligations that were recognized in other comprehensive income (loss) (in thousands):

	December 31,
	2013		2012		2011
Net gain (loss)	$	14,443	$	3,947	$	(18,503	)
Amortization of net actuarial loss	1,854		1,578		753
Net gain (loss)	$	16,297	$	5,525	$	(17,750	)
Tax benefit (provision)	6,439		2,132		(6,912		)
Total amount recognized in other comprehensive income (loss)	$	9,858	$	3,393	$	(10,838	)

Components of net periodic pension benefit cost were (in thousands):

	Year Ended December 31,
	2013			2012			2011
Service cost	$	—		$	—		$	—
Interest cost	5,259			5,379			5,872
Expected return on plan assets	(6,450		)	(6,190		)	(6,824		)
Amortization of prior service cost	—			—			—
Amortization of net loss	1,854			1,579			754
Net periodic benefit cost (gain)	$	663		$	768		$	(198	)

Our expected future pension benefit payments for the next 10 years are as follows (in thousands):

	Expected Future Pension Benefit Payments
For Years Ended December 31,
2014	$	7,914
2015	5,879
2016	5,955
2017	5,966
2018	6,281
2019 through 2023	38,156

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

	Year Ended December 31,
	2013		2012		2011
	SERP	Retirement Plan	SERP	Retirement Plan	SERP		Retirement Plan
Discount rate used to estimate our pension benefit obligation	4.70%	5.00%	3.60%	4.00%	3.90	%	4.20	%
Discount rate used to determine net periodic pension benefit	3.60%	4.00%	3.90%	4.20%	5.25	%	5.25	%
Rate of compensation increase	N/A	N/A	N/A	N/A	N/A		N/A
Expected long-term rate-of-return on plan assets	N/A	7.00%	N/A	7.00%	N/A		7.00	%

F-35

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

For the discount rate for the years ended December 31, 2013 and 2012, we used a custom bond modeler that develops a hypothetical portfolio of high quality corporate bonds, rated AA- and above by Standard & Poor's, that could be purchased to settle the obligations of the plan. The yield on this hypothetical portfolio represents a reasonable rate to value our plan liability.

We considered the current levels of expected returns on a risk-free investment, the historical levels of risk premium associated with each of our pension asset classes, the expected future returns for each of our pension asset classes and then weighted each asset class based on our pension plan asset allocation to derive an expected long-term return on pension plan assets. During the years ended December 31, 2013, 2012 and 2011, our actual rate of return on plan assets was 12.0%, 15.4% and 4.0%.

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

	Target Allocation		Percentage of Plan Assets as of December 31,
Asset Category	2013		2013		2012
Equity securities	60	%	60	%	55	%
Debt securities	40	%	40	%	45	%
	100	%	100	%	100	%

The following table summarizes our pension plan assets measured at fair value using the prescribed three-level fair value hierarchy as of December 31, 2013 and 2012 (in thousands):

	Quoted Prices in Active Markets for Identical Assets		Significant Observable Inputs
	(Level 1)		(Level 2)		Total
December 31, 2013:
Cash and cash equivalents	$	690	$	—	$	690
Money market fund	—		762		762
Commingled pools:
U.S. equity	—		37,645		37,645
International equity	—		18,884		18,884
REIT	—		3,213		3,213
High yield bond	—		4,101		4,101
Emerging markets	—		5,994		5,994
Investment grade fixed income	—		36,150		36,150
Total	$	690	$	106,749	$	107,439
December 31, 2012:
Cash and cash equivalents	$	573	$	—	$	573
Money market fund	—		519		519
Commingled pools:
U.S. equity	—		30,034		30,034
International equity	—		15,241		15,241
REIT	—		3,875		3,875
High yield bond	—		2,916		2,916
Emerging markets	—		6,374		6,374
Investment grade fixed income	—		36,880		36,880
Total	$	573	$	95,839	$	96,412

F-36

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

The commingled pools, U.S. and International stock funds and U.S. bond funds consist of various funds that are valued at the net asset value of units held by the plan at year-end as determined by the custodian, based on fair value of the underlying securities. These methods may produce a fair value calculation that may not be indicative of net realizable value or reflective of future values. Furthermore, while we believe these valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine fair value of certain financial instruments could result in different fair value measurement as of the reporting date.

Note 11—Shareholders' Equity

During the year ended December 31, 2011, our Board of Directors approved a stock repurchase program that authorized us to repurchase up to $25 million of our class A common shares over a 12 month period. This program was extended by our Board of Directors in November 2012 and was scheduled to expire on the earlier of the completion of all purchases contemplated by the plan or November 14, 2013; however, on February 12, 2013, as a result of entering into the Merger Agreement, we terminated the share repurchase program. Prior to the termination, during the year ended December 31, 2012, we repurchased approximately 3.3 million shares of our class A common shares on the open market for an aggregate purchase price of $11.4 million. We did not repurchase any shares during the year ended December 31, 2013.

Our class B common shares are convertible into an equal number of shares of our class A or class C common shares in various circumstances. During the year ended December 31, 2013, 2.5 million shares of our class B common shares were converted into class A common shares. During the year ended December 31, 2012, none of our class B common shares were converted into class A common shares.

Note 12—Restructuring and Contract Termination Costs

During the year ended December 31, 2013, we recorded restructuring charges of $3.9 million primarily related to severance and related costs associated with the integration of the television stations acquired during 2012. During the years ended December 31, 2012 and 2011, we recorded restructuring charges of $1.0 million and $0.7 million, respectively, as a result of severance and related costs as well as the consolidation of certain activities at our stations and our corporate headquarters. During the years ended December 31, 2013, 2012 and 2011, we made cash payments of $4.2 million, $0.8 million and $1.1 million related to these restructuring actions. We expect to make cash payments of $0.4 million related to these restructuring actions during 2014.

The activity for these restructuring charges relating to severance and related costs is as follows (in thousands):

	Severance and Related
Balance as of December 31, 2011	$	515
Charges	1,009
Payments	(807		)
Balance as of December 31, 2012	$	717
Charges	3,895
Payments	(4,189		)
Balance as of December 31, 2013	$	423

In December 2013, we terminated an agreement with a service provider that provided national sales representation and made a payment of $5.4 million to exit our agreement prior to its expiration. Concurrent with the termination of the agreement, we released $1.5 million of deferred credits associated with the terminated contract. The amount of the one-time termination payment, offset by the release of the deferred credits, has been reflected as Contract termination costs in our consolidated statement of operations for 2013.

F-37

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Note 13—Commitments and Contingencies

Commitments

We lease land, buildings, vehicles and equipment pursuant to non-cancelable operating lease agreements and we contract for general services pursuant to non-cancelable operating agreements that expire at various dates through 2036. In addition, we have entered into commitments for future syndicated entertainment and sports programming. Future payments for these non-cancelable operating leases and agreements, and future payments associated with syndicated television programs as of December 31, 2013 are as follows (in thousands):

	Operating Leases and Agreements		Syndicated Television Programming(1)		Total
Year
2014	$	45,076	$	27,119	$	72,195
2015	33,930		26,675		60,605
2016	16,140		17,387		33,527
2017	12,146		3,133		15,279
2018	1,611		153		1,764
Thereafter	7,139		214		7,353
Total obligations	$	116,042	$	74,681	$	190,723

^{_____________________________________________} 

⁽¹⁾Includes $6.3 million of program obligations recorded on our consolidated balance sheet as of December 31, 2013.

Rent expense, resulting from operating leases, was $5.8 million, $2.5 million and $1.5 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Contingencies

GECC Guarantee and the Merger

GECC provided secured debt financing for the joint venture between NBCUniversal and us, in the form of an $815.5 million non-amortizing senior secured note due 2023 bearing interest at an initial rate of 8% per annum until March 1, 2013 and 9% per annum thereafter. The GECC Note was an obligation of the joint venture. As of December 31, 2012, we had a 20.38% equity interest in the joint venture and NBCUniversal had the remaining 79.62% equity interest, in which we and NBCUniversal each had a 50% voting interest. NBCUniversal operated two television stations, KXAS-TV, an NBC affiliate in Dallas, and KNSD-TV, an NBC affiliate in San Diego, pursuant to a management agreement. LIN TV had previously guaranteed the payment of principal and interest on the GECC Note.

On February 12, 2013, we, along with our wholly-owned subsidiaries, LIN Television and LIN Texas, entered into, and simultaneously closed the JV Sale Transaction with subsidiaries of NBCUniversal, the GE Parties, Comcast, and SVH whereby in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations relating to the shortfall funding agreements.  Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal, and the LIN parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00.

We accrued for and expensed the $100 million capital contribution to SVH to secure the release of the guarantee and recorded the related tax effects in our consolidated financial statements as of December 31, 2012, because it represented a probable and estimable obligation of the Company.  In February 2013, we entered into a $60 million Incremental Facility and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million payment. As a result of the JV Sale Transaction, after utilizing all of our available Federal net operating loss (“NOL”) carryforwards, we had an approximate $162.8 million income tax payable remaining, $131.5 million of which was extinguished as a result of the Merger described below.

F-38

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

On July 30, 2013, LIN TV was merged with and into LIN LLC with LIN LLC continuing as the surviving entity. The Merger enabled the surviving entity to be classified as a partnership for federal income tax purposes and that change in classification was treated as a liquidation of LIN TV for federal income tax purposes with the result that LIN TV realized a capital loss in its 100% equity interest in LIN Television.

Based on an average of the opening and closing trading prices of LIN TV's class A common stock on the day of the Merger, LIN TV realized a capital loss of approximately $343 million, which represents the difference between its tax basis in the stock of LIN Television, and the fair market value of this stock as of July 30, 2013.  The capital loss realized and existing net operating losses were used to offset a portion of the capital gain recognized in the JV Sale Transaction and as a result, we realized tax savings of $131.5 million, resulting in a remaining tax liability of $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this tax liability during the fourth quarter of 2013.

As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee.

Litigation

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

Note 14—Income Taxes

Our income before income taxes is solely from domestic operations. The (benefit from) provision for income taxes consists of the following (in thousands):

	Year Ended December 31,
	2013			2012		2011
Current:
Federal	$	26,056		$	21	$	543
State	5,636			1,571		652
Foreign	—			633		—
Total current	$	31,692		$	2,225	$	1,195
Deferred:
Federal	$	(124,201	)	$	33,865	$	(25,907	)
State	(32,911		)	4,373		8,667
Total deferred	(157,112		)	38,238		(17,240		)
Total current and deferred	$	(125,420	)	$	40,463	$	(16,045	)

The following table reconciles the amount that would be calculated by applying the 35% federal statutory rate to income before income taxes to the actual (benefit from) provision for income taxes (in thousands):

F-39

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

	Year Ended December 31,
	2013			2012			2011
Provision assuming federal statutory rate	$	10,913		$	7,871		$	11,780
State taxes, net of federal tax benefit	3,863			5,723			1,790
State tax law/rate changes, net of federal tax benefit	—			1,883			5,703
Change in valuation allowance	(18,157		)	(4,622		)	(36,541		)
Share compensation	(53		)	(17		)	601
Reserve for tax contingencies	124			633			—
Impact of JV Sale Transaction	—			28,435			—
Impact of the Merger	(124,306		)	—			—
Non-deductible acquisition and Merger related transaction costs	1,645			—			—
Other	551			557			622
	$	(125,420	)	$	40,463		$	(16,045	)
Effective income tax rate on continuing operations	(402.2		)%	179.9		%	(47.7		)%

During the year ended December 31, 2013, we recognized a $124.3 million tax benefit as a result of the Merger as well as an $18.2 million tax benefit as a result of the reversal of state valuation allowances. These valuation allowances were reversed after evaluating our ability to recover certain net operating loss carryforwards due to the change in tax structure as a result of the Merger, as we concluded the Company will more likely than not be able to realize these deferred tax assets.

The impact of the JV Sale Transaction is a result of entering into and consummating the transactions contemplated by the JV Transaction Agreement on February 12, 2013, as described further in Note 1—"Basis of Presentation and Summary of Significant Accounting Policies" and in Note 13—"Commitments and Contingencies." The JV Sale Transaction resulted in the recognition of $27.5 million and $0.9 million of incremental short-term deferred federal and state tax liabilities, respectively, in excess of those which were previously established. The financial impact of the JV Sale Transaction and corresponding tax expense of $28.4 million are reflected in our consolidated financial statements for the year ended December 31, 2012. During the first quarter of 2013, approximately $162.8 million of short term deferred liabilities were reclassified to income taxes payable upon the consummation of the JV Sale Transaction. As a result of the close of the Merger on July 30, 2013, $131.5 million of this tax liability was extinguished, resulting in a remaining tax liability of approximately $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this tax liability during the fourth quarter of 2013.

The 2011 state tax law/rate change, net of federal tax benefit, of $5.7 million is primarily a result of state tax legislation enacted in Michigan in May 2011, which repealed the Michigan business tax ("MBT"), and implemented a corporate income tax instead, effective January 2012. As a result of the elimination of the MBT, certain future tax deductions that were available to be utilized beginning in 2015, and had been recognized as deferred tax assets in our financial statements, will not be deductible. Therefore, during the year ended December 31, 2011, we recognized incremental deferred income tax expense of $5.1 million, net of federal benefit, for the reversal of these previously established deferred tax assets. In addition, the 2012 state tax law/rate change, net of federal tax benefit, of $1.9 million is a result of a change in the effective tax rate used to value our deferred tax assets/liabilities.

The components of the net deferred tax liability are as follows (in thousands):

F-40

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

	December 31,
	2013			2012
Deferred tax liabilities:
Deferred gain related to equity investment in NBC joint venture	$	—		$	259,049
Property and equipment	11,816			12,822
Intangible assets	54,859			36,761
Deferred gain on debt repurchase	18,140			18,309
Noncontrolling interest	849			549
Other	7,629			7,476
Total	$	93,293		$	334,966
Deferred tax assets:
Net operating loss carryforwards	$	(17,707	)	$	(110,169	)
Equity investments	(2,372		)	(1,554		)
Other	(15,426		)	(32,625		)
Valuation allowance	—			18,157
Total	(35,505		)	(126,191		)
Net deferred tax liabilities	$	57,788		$	208,775

We maintain a valuation allowance related to our deferred tax asset position when management believes it is more likely than not that the deferred tax assets will not be realized in the future. As of December 31, 2012, we had a valuation allowance of $18.2 million offsetting certain state net operating loss carryforwards and other state deferred tax assets. During the third quarter of 2013, after evaluating our ability to recover certain net operating loss carryforwards due to the change in tax structure as a result of the Merger, we determined that we will more likely than not be able to realize these deferred tax assets. As a result, we reversed the valuation allowance and recognized a corresponding tax benefit of $18.2 million.

As of December 31, 2013, we had federal net operating loss carryforwards (tax effected) of approximately $4.6 million that begin to expire in 2034. Additionally, we had state net operating loss carryforwards that vary by jurisdiction (tax effected, net of federal benefit) of $13.1 million, expiring through 2033. Included in the total federal and state net operating loss carryforwards (tax effected) is $4.9 million that would be recorded in equity when realized.

Unrecognized Tax Benefits.

The Company's uncertain tax positions for the years ended December 31, 2013, 2012, and 2011 are limited to certain unrecognized state and foreign benefits totaling $24.5 million, $26.6 million and $26.4 million, respectively. As of December 31, 2013, 2012 and 2011, there are $0.9 million, $0.8 million and $0 million of unrecognized tax benefits, respectively, that if recognized would reduce the effective tax rate from continuing operations.

We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. During the years ended December 31, 2013, 2012 and 2011, we did not recognize or accrue any amounts related to interest and penalties.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands):

	Year Ended December 31,
	2013			2012			2011
Balance at beginning of year	$	26,559		$	26,381		$	26,610
Additions for tax positions of current year	733			1,798			2,386
Additions for tax positions of prior years	—			—			—
Reductions for tax positions of prior years	(2,084		)	(1,133		)	(2,128		)
Reductions related to settlements with taxing authorities	—			—			—
Reductions related to expiration of the statute of limitations	(730		)	(487		)	(487		)
Balance at end of year	$	24,478		$	26,559		$	26,381

F-41

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

We file a consolidated federal income tax return and we file numerous other consolidated and separate income tax returns in U.S. state jurisdictions. Tax years 2009-2012 remain open to examination by major taxing jurisdictions.

Note 15—Accrued Expenses

Accrued expenses consisted of the following (in thousands):

	December 31,
	2013		2012
Accrued compensation	$	11,817	$	11,275
Accrued contract costs	3,394		4,163
Accrued interest	12,168		7,841
Accrued capital contribution to joint venture	—		100,000
Other accrued expenses	24,317		29,967
Total	$	51,696	$	153,246

Note 16—Subsequent Events

On February 3, 2014, LIN Digital Media LLC, a wholly owned subsidiary, completed its acquisition of Federated Media Publishing, Inc. ("Federated Media"), which was subsequently converted into a Delaware limited liability company. Federated Media is an industry-leading digital content and conversational marketing company. For further information on this acquisition, see Note 2 — “Acquisitions.”

Note 17—Condensed Consolidating Financial Statements

LIN Television, a 100% owned subsidiary of LIN LLC, is the primary obligor of our senior secured credit facility, our 8³/₈% Senior Notes and our 6³/₈% Senior Notes, which are further described in Note 7 — “ Debt”. LIN LLC fully and unconditionally guarantees all of LIN Television’s debt on a joint-and-several basis. Additionally, all of the consolidated 100% owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television’s senior secured credit facility, our 8³/₈% Senior Notes and our 6³/₈% Senior Notes on a joint-and-several basis, subject to customary release provisions. There are certain contractual restrictions on LIN Television’s ability to obtain funds in the form of dividends or loans from the non-guarantor subsidiaries.

The following condensed consolidating financial statements present the consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income and consolidated statements of cash flows of LIN LLC, LIN Television, as the issuer, the guarantor subsidiaries, and the non-guarantor subsidiaries of LIN Television and the elimination entries necessary to consolidate or combine the issuer with the guarantor and non-guarantor subsidiaries. These statements are presented in accordance with the disclosure requirements under SEC Regulation S-X Rule 3-10.

The condensed consolidating balance sheet as of December 31, 2012, has been revised to correct certain immaterial errors relating to intercompany balances. The revisions comprise a $4.3 million decrease in advances to subsidiaries lines in the LIN Television and the Guarantor Subsidiaries columns, a $4.3 million decrease in intercompany liabilities in the LIN Television and Non-Guarantor Subsidiaries columns, a $4.3 million decrease in the Total Shareholders’ (deficit) equity line of the Guarantor column, and a $4.3 million increase in the Total Shareholders’ (deficit) equity line of the Non-Guarantor column.

F-42

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Balance Sheet

As of December 31, 2013

(in thousands)

	LIN Media LLC		LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	10,313	$	3	$	2,209	$	—		$	12,525
Accounts receivable, net	—		88,905		39,416		16,988		—			145,309
Deferred income tax assets	—		5,818		1,080		—		—			6,898
Other current assets	—		12,264		1,049		1,888		—			15,201
Total current assets	—		117,300		41,548		21,085		—			179,933
Property and equipment, net	—		180,480		35,752		4,846		—			221,078
Deferred financing costs	—		16,357		—		91		—			16,448
Goodwill	—		169,492		18,518		15,518		—			203,528
Broadcast licenses, net	—		—		493,814		42,701		—			536,515
Other intangible assets, net	—		31,303		1,840		13,906		—			47,049
Advances to consolidated subsidiaries	1,900		7,764		968,728		—		(978,392		)	—
Investment in consolidated subsidiaries	87,227		1,534,600		—		—		(1,621,827		)	—
Other assets	—		52,778		2,688		1,276		(44,443		)	12,299
Total assets	$	89,127	$	2,110,074	$	1,562,888	$	99,423	$	(2,644,662	)	$	1,216,850
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	—	$	16,112	$	—	$	1,252	$	—		$	17,364
Accounts payable	—		4,185		5,339		4,478		—			14,002
Income taxes payable	—		749		671		—		—			1,420
Accrued expenses	—		42,570		6,254		2,872		—			51,696
Program obligations	—		4,711		1,013		1,303		—			7,027
Total current liabilities	—		68,327		13,277		9,905		—			91,509
Long-term debt, excluding current portion	—		924,223		—		3,105		—			927,328
Deferred income tax liabilities	—		30,013		33,824		849		—			64,686
Program obligations	—		2,505		217		1,424		—			4,146
Intercompany liabilities	—		970,628		—		7,764		(978,392		)	—
Other liabilities	—		27,151		58		44,443		(44,443		)	27,209
Total liabilities	—		2,022,847		47,376		67,490		(1,022,835		)	1,114,878
Redeemable noncontrolling interest	—		—		—		12,845		—			12,845
Total shareholders' equity (deficit)	89,127		87,227		1,515,512		19,088		(1,621,827		)	89,127
Total liabilities, redeemable noncontrolling interest and shareholders' equity (deficit)	$	89,127	$	2,110,074	$	1,562,888	$	99,423	$	(2,644,662	)	$	1,216,850

F-43

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Balance Sheet

As of December 31, 2012

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	44,625		$	573	$	1,109	$	—		$	46,307
Accounts receivable, net	—			87,103			31,144		7,903		—			126,150
Deferred income tax assets	—			67,412			—		97		(67,509		)	—
Other current assets	—			4,850			554		1,459		—			6,863
Total current assets	—			203,990			32,271		10,568		(67,509		)	179,320
Property and equipment, net	—			197,125			39,534		4,832		—			241,491
Deferred financing costs	—			19,020			—		115		—			19,135
Goodwill	—			169,492			18,518		4,504		—			192,514
Broadcast licenses, net	—			—			493,814		42,701		—			536,515
Other intangible assets, net	—			48,897			2,775		7,882		—			59,554
Advances to consolidated subsidiaries	—			6,746			1,345,971		—		(1,352,717		)	—
Investment in consolidated subsidiaries	—			1,554,903			—		—		(1,554,903		)	—
Other assets	—			53,987			2,552		1,626		(45,280		)	12,885
Total assets	$	—		$	2,254,160		$	1,935,435	$	72,228	$	(3,020,409	)	$	1,241,414
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS' DEFICIT
Current liabilities:
Current portion of long-term debt	$	—		$	9,243		$	—	$	1,513	$	—		$	10,756
Accounts payable	—			14,335			3,385		1,235		—			18,955
Income taxes payable	—			372			394		—		—			766
Accrued expenses	—			37,020			115,605		621		—			153,246
Deferred income tax liabilities	—			—			235,728		—		(67,509		)	168,219
Program obligations	—			7,479			1,106		2,185		—			10,770
Total current liabilities	—			68,449			356,218		5,554		(67,509		)	362,712
Long-term debt, excluding current portion	—			875,512			—		3,959		—			879,471
Deferred income tax liabilities	—			10,910			29,000		646		—			40,556
Program obligations	—			2,222			92		1,967		—			4,281
Intercompany liabilities	—			1,345,971			3,842		2,904		(1,352,717		)	—
Accumulated losses in excess of investment in consolidated subsidiaries	91,564			—			—		—		(91,564		)	—
Other liabilities	—			42,660			56		45,280		(45,280		)	42,716
Total liabilities	91,564			2,345,724			389,208		60,310		(1,557,070		)	1,329,736
Redeemable noncontrolling interest	—			—			—		3,242		—			3,242
Total shareholders' (deficit) equity	(91,564		)	(91,564		)	1,546,227		8,676		(1,463,339		)	(91,564		)
Total liabilities, redeemable noncontrolling interest and shareholders' equity (deficit)	$	—		$	2,254,160		$	1,935,435	$	72,228	$	(3,020,409	)	$	1,241,414

F-44

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2013

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—		$	428,806		$	181,678		$	55,850		$	(13,971	)	$	652,363
Operating expenses:
Direct operating	—			145,176			76,275			37,295			(7,668		)	251,078
Selling, general and administrative	—			109,679			40,934			12,516			(579		)	162,550
Amortization of program rights	—			21,452			5,690			2,100			—			29,242
Corporate	709			40,668			—			—			—			41,377
Depreciation	—			38,306			7,256			1,292			—			46,854
Amortization of intangible assets	—			17,594			935			4,297			—			22,826
Restructuring	—			3,633			—			262			—			3,895
Contract termination costs	—			3,887			—			—			—			3,887
Loss from asset dispositions	—			705			5			—			—			710
Operating (loss) income	(709		)	47,706			50,583			(1,912		)	(5,724		)	89,944
Other (income) expense:
Interest expense, net	—			56,386			—			221			—			56,607
Share of loss in equity investments	—			56			—			—			—			56
Intercompany (income) expense	(20		)	27,947			(28,243		)	316			—			—
Other, net				2,097			—			3			—			2,100
Total other (income) expense, net	(20		)	86,486			(28,243		)	540			—			58,763
(Loss) income from continuing operations before taxes and equity in (loss) income from operations of consolidated subsidiaries	(689		)	(38,780		)	78,826			(2,452		)	(5,724		)	31,181
(Benefit from) provision for income taxes	—			(155,975		)	31,530			(975		)	—			(125,420		)
Net (loss) income from continuing operations	(689		)	117,195			47,296			(1,477		)	(5,724		)	156,601
Equity in income (loss) from operations of consolidated subsidiaries	158,802			41,607			—			—			(200,409		)	—
Net income (loss)	158,113			158,802			47,296			(1,477		)	(206,133		)	156,601
Net loss attributable to noncontrolling interests	—			—			—			(1,512		)	—			(1,512		)
Net income (loss) attributable to LIN Media LLC	$	158,113		$	158,802		$	47,296		$	35		$	(206,133	)	$	158,113

F-45

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Comprehensive Income

For the Year Ended December 31, 2013

(in thousands)

	LIN Media LLC		LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net income (loss)	$	158,113	$	158,802	$	47,296	$	(1,477	)	$	(206,133	)	$	156,601
Pension net gain, net of tax of $5,705	8,738		8,738		—		—			(8,738		)	8,738
Amortization of pension net losses, net of tax of $734	1,120		1,120		—		—			(1,120		)	1,120
Comprehensive income (loss)	167,971		168,660		47,296		(1,477		)	(215,991		)	166,459
Comprehensive loss attributable to noncontrolling interest	—		—		—		(1,512		)	—			(1,512		)
Comprehensive income (loss) attributable to LIN Media LLC	$	167,971	$	168,660	$	47,296	$	35		$	(215,991	)	$	167,971

F-46

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2012

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—		$	369,779		$	181,458		$	9,571		$	(7,346	)	$	553,462
Operating expenses:
Direct operating	—			96,504			62,352			5,201			(3,835		)	160,222
Selling, general and administrative	—			85,638			37,917			2,152			(440		)	125,267
Amortization of program rights	—			16,644			5,437			967			—			23,048
Corporate	—			30,357			3,889			—			—			34,246
Depreciation	—			24,061			7,635			453			—			32,149
Amortization of intangible assets	—			4,139			935			1,290			—			6,364
Restructuring	—			1,009			—			—			—			1,009
Loss (gain) from asset dispositions	—			111			(15		)	—			—			96
Operating income (loss)	—			111,316			63,308			(492		)	(3,071		)	171,061
Other expense (income):
Interest expense, net	—			46,625			—			156			(98		)	46,683
Share of loss in equity investments	—			153			98,156			—			—			98,309
Loss on extinguishment of debt	—			3,341			—			—			—			3,341
Intercompany fees and expenses	—			26,549			(26,548		)	(1		)	—			—
Other, net	—			237			—			—			—			237
Total other expense (income), net	—			76,905			71,608			155			(98		)	148,570
Income (loss) from continuing operations before taxes and equity in (loss) income from operations of consolidated subsidiaries	—			34,411			(8,300		)	(647		)	(2,973		)	22,491
Provision for (benefit from) income taxes	—			44,298			(3,320		)	(515		)	—			40,463
Net loss from continuing operations	—			(9,887		)	(4,980		)	(132		)	(2,973		)	(17,972		)
Loss from discontinued operations, net	—			(251		)	(744		)	—			(23		)	(1,018		)
(Loss) gain on the sale of discontinued operations, net	—			(289		)	11,678			—			—			11,389
Equity in (loss) income from operations of consolidated subsidiaries	(7,045		)	3,382			—			—			3,663			—
Net (loss) income	(7,045		)	(7,045		)	5,954			(132		)	667			(7,601		)
Net loss attributable to noncontrolling interests	—			—			—			(556		)	—			(556		)
Net (loss) income attributable to LIN Media LLC	$	(7,045	)	$	(7,045	)	$	5,954		$	424		$	667		$	(7,045	)

F-47

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Comprehensive Loss

For the Year Ended December 31, 2012

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net (loss) income	$	(7,045	)	$	(7,045	)	$	5,954	$	(132	)	$	667		$	(7,601	)
Pension net gain, net of tax of $1,523	2,424			2,424			—		—			(2,424		)	2,424
Amortization of pension net losses, net of tax of $609	969			969			—		—			(969		)	969
Comprehensive (loss) income	(3,652		)	(3,652		)	5,954		(132		)	(2,726		)	(4,208		)
Comprehensive loss attributable to noncontrolling interest	—			—			—		(556		)	—			(556		)
Comprehensive (loss) income attributable to LIN Media LLC	$	(3,652	)	$	(3,652	)	$	5,954	$	424		$	(2,726	)	$	(3,652	)

F-48

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2011

(in thousands)

	LIN Media LLC		LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—	$	263,958		$	136,891		$	1,745		$	(2,591	)	$	400,003
Operating expenses:
Direct operating	—		78,492			53,877			604			(2,355		)	130,618
Selling, general and administrative	—		69,018			34,825			491			(564		)	103,770
Amortization of program rights	—		15,535			5,438			433			—			21,406
Corporate	—		24,838			1,643			—			—			26,481
Depreciation	—		19,169			7,030			47			—			26,246
Amortization of intangible assets	—		264			868			67			—			1,199
Restructuring	—		707			—			—			—			707
Loss from asset dispositions	—		351			121			—			—			472
Operating income	—		55,584			33,089			103			328			89,104
Other expense (income):
Interest expense, net	—		50,688			—			21			(3		)	50,706
Share of loss in equity investments	—		260			4,697			—			—			4,957
Gain on derivative instruments	—		(1,960		)	—			—			—			(1,960		)
Loss on extinguishment of debt	—		1,694			—			—			—			1,694
Intercompany fees and expenses	—		57,931			(57,945		)	14			—			—
Other, net	—		68			(4		)	(13		)	—			51
Total other expense (income), net	—		108,681			(53,252		)	22			(3		)	55,448
(Loss) income from continuing operations before taxes and equity in income (loss) from operations of consolidated subsidiaries	—		(53,097		)	86,341			81			331			33,656
(Benefit from) provision for income taxes	—		(50,521		)	34,536			(60		)	—			(16,045		)
Net (loss) income from continuing operations	—		(2,576		)	51,805			141			331			49,701
(Loss) income from discontinued operations, net	—		(1,316		)	544			—			(148		)	(920		)
Equity in income (loss) from operations of consolidated subsidiaries	48,577		52,469			—			—			(101,046		)	—
Net income (loss)	48,577		48,577			52,349			141			(100,863		)	48,781
Net loss attributable to noncontrolling interests	—		—			—			204			—			204
Net income (loss) attributable to LIN Media LLC	$	48,577	$	48,577		$	52,349		$	(63	)	$	(100,863	)	$	48,577

F-49

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Comprehensive Income

For the Year Ended December 31, 2011

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net income (loss)	$	48,577		$	48,577		$	52,349	$	141	$	(100,863	)	$	48,781
Pension net loss, net of tax of $(7,291)	(11,212		)	(11,212		)	—		—		11,212			(11,212		)
Amortization of pension net loss, net of tax of $379	374			374			—		—		(374		)	374
Comprehensive income (loss)	37,739			37,739			52,349		141		(90,025		)	37,943
Comprehensive income attributable to noncontrolling interest	—			—			—		—		204			204
Comprehensive income (loss) attributable to LIN Media LLC	$	37,739		$	37,739		$	52,349	$	141	$	(90,229	)	$	37,739

F-50

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2013

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities, continuing operations	$	(589	)	$	(1,986	)	$	50,612		$	930		$	—		$	48,967
INVESTING ACTIVITIES:
Capital expenditures	—			(22,768		)	(3,540		)	(3,066		)	—			(29,374		)
Payments for business combinations, net of cash acquired	—			(10,082		)	—			—			—			(10,082		)
Proceeds from the sale of assets	—			66			20			—			—			86
Capital contribution to joint venture with NBCUniversal	—			—			(100,000		)	—			—			(100,000		)
Receipt of dividend	2,000			78,011			—			—			(80,011		)	—
Advances on intercompany borrowings	(2,000		)	(4,550		)	—			—			6,550			—
Payments from intercompany borrowings	—			15,009			145,358			—			(160,367		)	—
Net cash (used in) provided by investing activities, continuing operations	—			55,686			41,838			(3,066		)	(233,828		)	(139,370		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director stock-based compensation	589			1,256			—			—			—			1,845
Tax benefit from exercises of share options	—			1,591			—			—			—			1,591
Proceeds from borrowings on long-term debt	—			139,000			—			—			—			139,000
Principal payments on long-term debt	—			(83,846		)	—			(1,314		)	—			(85,160		)
Payment of long-term debt issue costs	—			(655		)	—			—			—			(655		)
Payment of dividend	—			(2,000		)	(78,011		)	—			80,011			—
Proceeds from intercompany borrowings	—			2,000			—			4,550			(6,550		)	—
Payments on intercompany borrowings	—			(145,358		)	(15,009		)	—			160,367			—
Net cash provided by (used in) financing activities	589			(88,012		)	(93,020		)	3,236			233,828			56,621
Net (decrease) increase in cash and cash equivalents	—			(34,312		)	(570		)	1,100			—			(33,782		)
Cash and cash equivalents at the beginning of the period	—			44,625			573			1,109			—			46,307
Cash and cash equivalents at the end of the period	$	—		$	10,313		$	3		$	2,209		$	—		$	12,525

F-51

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2012

(in thousands)

	LIN Media LLC		LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
OPERATING ACTIVITIES:
Net cash provided by operating activities, continuing operations	$	—	$	142,255		$	4,998		$	2,159		$	23		$	149,435
Net cash used in operating activities, discontinued operations	—		(471		)	(2,242		)	—			(23		)	(2,736		)
Net cash provided by operating activities	—		141,784			2,756			2,159			—			146,699
INVESTING ACTIVITIES:
Capital expenditures	—		(20,158		)	(5,709		)	(2,363		)	—			(28,230		)
Change in restricted cash	—		255,159			—			—			—			255,159
Payments for business combinations, net of cash acquired	—		(352,162		)	—			(6,333		)	—			(358,495		)
Proceeds from the sale of assets	—		30			49			—			—			79
Shortfall loan to joint venture with NBCUniversal	—		(2,292		)	—			—			—			(2,292		)
Advances on intercompany borrowings	—		(2,400		)	—			—			2,400			—
Payments from intercompany borrowings	—		20,382			—			—			(20,382		)	—
Net cash used in investing activities, continuing operations	—		(101,441		)	(5,660		)	(8,696		)	(17,982		)	(133,779		)
Net cash provided by investing activities, discontinued operations	—		6,314			23,206			—			—			29,520
Net cash (used in) provided by investing activities	—		(95,127		)	17,546			(8,696		)	(17,982		)	(104,259		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director stock-based compensation	—		1,314			—			—			—			1,314
Proceeds from borrowings on long-term debt	—		322,000			—			6,333			—			328,333
Principal payments on long-term debt	—		(320,374		)	—			(1,805		)	—			(322,179		)
Payment of long-term debt issue costs	—		(10,157		)	—			(115		)	—			(10,272		)
Treasury stock purchased	—		(11,386		)	—			—			—			(11,386		)
Proceeds from intercompany borrowings	—		—			—			2,400			(2,400		)	—
Payments on intercompany borrowings	—		—			(20,382		)	—			20,382			—
Net cash (used in) provided by financing activities	—		(18,603		)	(20,382		)	6,813			17,982			(14,190		)
Net increase (decrease) in cash and cash equivalents	—		28,054			(80		)	276			—			28,250
Cash and cash equivalents at the beginning of the period	—		16,571			653			833			—			18,057
Cash and cash equivalents at the end of the period	$	—	$	44,625		$	573		$	1,109		$	—		$	46,307

F-52

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2011

(in thousands)

	LIN Media LLC		LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
OPERATING ACTIVITIES:
Net cash provided by operating activities, continuing operations	$	—	$	52,012		$	10,799		$	103		$	148		$	63,062
Net cash (used in) provided by operating activities, discontinued operations	—		(1,180		)	926			—			(148		)	(402		)
Net cash provided by operating activities	—		50,832			11,725			103			—			62,660
INVESTING ACTIVITIES:
Capital expenditures	—		(12,266		)	(7,763		)	(40		)	—			(20,069		)
Change in restricted cash	—		(255,159		)	—			—			—			(255,159		)
Payments for business combinations, net of cash acquired	—		(10,046		)	—			1,013			—			(9,033		)
Proceeds from the sale of assets	—		72			2			—			—			74
Payments on derivative instruments	—		(2,020		)	—			—			—			(2,020		)
Shortfall loan to joint venture with NBCUniversal	—		(2,483		)	—			—			—			(2,483		)
Other investments, net	—		(375		)	—			—			—			(375		)
Advances to consolidated subsidiaries	—		(400		)	—			—			400			—
Payments from consolidated subsidiaries	—		3,750			—			—			(3,750		)	—
Net cash (used in) provided by investing activities, continuing operations	—		(278,927		)	(7,761		)	973			(3,350		)	(289,065		)
Net cash used in investing activities, discontinued operations	—		(106		)	(9		)	—			—			(115		)
Net cash (used in) provided by investing activities	—		(279,033		)	(7,770		)	973			(3,350		)	(289,180		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director stock-based compensation	—		841			—			—			—			841
Proceeds from borrowings on long-term debt	—		417,695			—			—			—			417,695
Principal payments on long-term debt	—		(174,573		)	—			(643		)	—			(175,216		)
Payment of long-term debt issue costs	—		(7,662		)	—			—			—			(7,662		)
Treasury stock purchased	—		(2,729		)	—			—			—			(2,729		)
Proceeds from intercompany borrowings	—		—			—			400			(400		)	—
Payments on intercompany borrowings	—		—			(3,750		)	—			3,750			—
Net cash provided by (used in) financing activities, continuing operations	—		233,572			(3,750		)	(243		)	3,350			232,929
Net cash provided by (used in) financing activities	$	—	$	233,572		$	(3,750	)	$	(243	)	$	3,350		$	232,929
Net increase in cash and cash equivalents	—		5,371			205			833			—			6,409
Cash and cash equivalents at the beginning of the period	—		11,200			448			—			—			11,648
Cash and cash equivalents at the end of the period	—		16,571			653			833			—			18,057

F-53

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Note 18—Unaudited Quarterly Data

	Quarter Ended
	March 31, 2013			June 30, 2013		September 30, 2013			December 31, 2013
	(in thousands, except per share data)
Net revenues	$	140,992		$	164,346	$	163,110		$	183,915
Operating income	$	11,776		$	26,916	$	23,226		$	28,026
(Loss) income from continuing operations	$	(1,020	)	$	7,169	$	146,508	(1)	$	3,944
Net (loss) income attributable to LIN Media LLC	$	(856	)	$	7,475	$	146,938		$	4,556
Basic (loss) earnings per common share from continuing operations attributable to LIN Media LLC	$	(0.02	)	$	0.14	$	2.78		$	0.09
Basic (loss) earnings per common share attributable to LIN Media LLC	$	(0.02	)	$	0.14	$	2.78		$	0.09
Diluted (loss) earnings per common share from continuing operations attributable to LIN Media LLC	$	(0.02	)	$	0.13	$	2.63		$	0.08
Diluted (loss) earnings per common share attributable to LIN Media LLC	$	(0.02	)	$	0.13	$	2.63		$	0.08
Weighted-average number of common shares outstanding used in calculating income per common share:
Basic	51,910			52,278		52,791			52,879
Diluted	51,910			55,595		55,855			56,240

________________________________________

⁽¹⁾ During the year ended December 31, 2013, we recognized a $124.3 million tax benefit as a result of the Merger as well as an $18.2 million tax benefit as a result of the reversal of state valuation allowances. For further discussion, see Note 14 - "Income Taxes."

	Quarter Ended
	March 31, 2012			June 30, 2012		September 30, 2012		December 31, 2012
	(in thousands, except per share data)
Net revenues	$	103,200		$	121,016	$	133,076	$	196,170
Operating income	$	20,460		$	34,995	$	44,367	$	71,239
Income (loss) from continuing operations	$	5,115		$	15,457	$	19,619	$	(58,163	)
(Loss) income from discontinued operations	$	(1,231	)	$	11,602	$	—	$	—
Net income (loss) attributable to LIN Media LLC	$	4,266		$	27,118	$	19,659	$	(58,088	)
Basic earnings (loss) per common share from continuing operations attributable to LIN Media LLC	$	0.10		$	0.28	$	0.37	$	(1.09	)
Basic earnings (loss) per common share attributable to LIN Media LLC	$	0.08		$	0.49	$	0.37	$	(1.09	)
Diluted earnings (loss) per common share from continuing operations attributable to LIN Media LLC	$	0.10		$	0.27	$	0.36	$	(1.09	)
Diluted earnings (loss) per common share attributable to LIN Media LLC	$	0.08		$	0.48	$	0.36	$	(1.09	)
Weighted-average number of common shares outstanding used in calculating income per common share:
Basic	56,184			55,174		53,066		53,169
Diluted	57,512			56,300		54,353		53,169

F-54

LIN Media LLC

Notes to Consolidated Financial Statements (Continued)

Note 19—Supplemental Disclosure of Cash Flow Information

	Year Ended December 31,
	2013		2012		2011
	(in thousands)
Cash paid for interest expense	$	48,646	$	42,348	$	47,801
Cash paid for income taxes—continuing operations	$	32,937	$	1,103	$	559
Non-cash investing activities:
Accrual for estimated shortfall loans to SVH	$	—	$	—	$	4,697
Non-cash financing activities:
Capital leases assumed in acquisitions	$	179	$	14,896	$	—

Note 20—Valuation and Qualifying Accounts

	Balance at Beginning of Period		Charged(Released) to Operations			Deductions			Balance at End of Period
	(in thousands)
Allowance for doubtful accounts as of December 31,
2013	$	3,599	$	1,608		$	(2,019	)	$	3,188
2012	$	2,310	$	2,047		$	(758	)	$	3,599
2011	$	2,194	$	760		$	(644	)	$	2,310
Valuation allowance for state and federal deferred tax assets as of December 31,
2013	$	18,157	$	(18,157	)	$	—		$	—
2012	$	23,422	$	(5,265	)	$	—		$	18,157
2011	$	59,990	$	(36,568	)	$	—		$	23,422

F-55

Note 21—Segment Reporting

Effective January 1, 2014, we began operating under two segments, which also represent our reportable segments, “Broadcast” and “Digital,” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites, and our Digital segment includes the operating results of our digital companies; LIN Digital, LIN Mobile, Nami Media, HYFN, Dedicated Media, and Federated Media (acquired in February 2014). Unallocated corporate expenses primarily include our costs to operate as a public company and to operate our corporate locations. All revenues are generated in the United States of America. All impacted sections of this filing have been updated to reflect this change in reportable segments.

We use earnings before interest, taxes, depreciation and amortization, excluding non-recurring charges, restructuring charges, share-based compensation, loss or gain on sales of assets, and cash paid for programming (“Adjusted EBITDA”) as the primary financial measure reported to the chief executive officer (the chief operating decision maker) for use in assessing our operating segments’ operating performance. We believe that this measure is useful to investors because it eliminates a significant level of non-cash depreciation and amortization expense and other non-recurring charges and as a result, allows investors to better understand our operating segments’ performance. All adjustments to Adjusted EBITDA presented below to arrive at consolidated pre-tax income (loss) except for depreciation and amortization and cash paid for programming relate primarily to corporate activities. Cash paid for programming pertains only to our Broadcast segment. As a result, we have disclosed depreciation and amortization by segment, as this is the only adjustment to operating income that the chief executive officer reviews on a segment basis. We have presented prior period information to reflect our current reportable segments.

	Year ended December 31,
	2013		2012		2011
			(in thousands)
Net revenues:
Broadcast	$	576,510	$	512,367	$	372,783
Digital	75,853		41,095		27,220
Total net revenues	$	652,363	$	553,462	$	400,003

The following table is a reconciliation of Adjusted EBITDA to consolidated income before (benefit from) provision for income taxes.

F-56

	Year ended December 31,
	2013			2012			2011
				(in thousands)
Segment Adjusted EBITDA:
Broadcast	$	205,843		$	241,831		$	141,081
Digital	4,020			1,970			292
Total segment Adjusted EBITDA	209,863			243,801			141,373
Unallocated corporate	(23,966		)	(24,268		)	(18,514		)
Less:
Depreciation	46,854			32,149			26,246
Amortization of intangible assets	22,826			6,364			1,199
Amortization of program rights	29,242			23,048			21,406
Share-based compensation	9,374			6,857			6,176
Non-recurring and acquisition-related charges (1)	10,842			3,207			2,171
Restructuring charge	3,895			1,009			707
Contract termination costs	3,887			—			—
Loss on sale of assets	710			96			472
Add:
Cash payments for programming	31,677			24,258			24,622
Operating income	89,944			171,061			89,104
Other expense:
Interest expense, net	56,607			46,683			50,706
Share of loss in equity investments	56			98,309			4,957
Gain on derivative instruments	—			—			(1,960		)
Loss on extinguishment of debt	—			3,341			1,694
Other expense, net	2,100			237			51
Total other expense, net	58,763			148,570			55,448
Consolidated income before (benefit from) provision for income taxes	$	31,181		$	22,491		$	33,656

^{____________________________________________} 

⁽¹⁾ Non-recurring charges for the year ended December 31, 2013 primarily consist of expenses related to the Merger. Charges for the years ended December 31, 2012 and 2011 relate solely to acquisitions.

	Year ended December 31,
	2013			2012			2011
				(in thousands)
Operating income (loss):
Broadcast	$	142,753		$	207,431		$	118,399
Digital	(365		)	(461		)	(815		)
Unallocated corporate	(52,444		)	(35,909		)	(28,480		)
Total operating income	$	89,944		$	171,061		$	89,104

F-57

	Year ended December 31,
	2013		2012		2011
			(in thousands)
Depreciation and amortization:
Broadcast	$	64,887	$	35,521	$	25,761
Digital	4,046		2,365		1,105
Unallocated corporate	747		627		579
Total depreciation and amortization	$	69,680	$	38,513	$	27,445

	Year ended December 31,
	2013		2012		2011
			(in thousands)
Capital expenditures:
Broadcast	$	22,957	$	23,342	$	18,616
Digital	4,416		2,884		722
Unallocated corporate	2,001		2,004		731
Total capital expenditures	$	29,374	$	28,230	$	20,069

	December 31,		December 31,
	2013		2012
	(in thousands)
Assets:
Broadcast	$	1,100,343	$	1,136,861
Digital	69,690		29,351
Unallocated corporate	46,817		75,202
Total assets	$	1,216,850	$	1,241,414

F-58

Table of Contents

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholder of LIN Television Corporation:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of LIN Television Corporation and its subsidiaries at December 31, 2013 and December 31, 2012, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2013 in conformity with accounting principles generally accepted in the United States of America. 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 of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Hartford, Connecticut

March 3, 2014 except for Note 19, as to which the date is June 13, 2014

F-59

LIN Television Corporation

Consolidated Balance Sheets

	December 31,
	2013			2012
	(in thousands, except share data)
ASSETS
Current assets:
Cash and cash equivalents	$	12,525		$	46,307
Accounts receivable, less allowance for doubtful accounts (2013—$3,188; 2012—$3,599)	145,409			126,150
Deferred income tax assets	6,898			—
Other current assets	15,201			6,863
Total current assets	180,033			179,320
Property and equipment, net	221,078			241,491
Deferred financing costs	16,448			19,135
Goodwill	203,528			192,514
Broadcast licenses	536,515			536,515
Other intangible assets, net	47,049			59,554
Other assets	12,299			12,885
Total assets (a)	$	1,216,950		$	1,241,414
LIABILITIES AND EQUITY (DEFICIT)
Current liabilities:
Current portion of long-term debt	$	17,364		$	10,756
Accounts payable	14,002			18,955
Income taxes payable	1,420			766
Accrued expenses	51,696			153,246
Deferred income tax liabilities	—			168,219
Program obligations	7,027			10,770
Total current liabilities	91,509			362,712
Long-term debt, excluding current portion	929,328			879,471
Deferred income tax liabilities	64,686			40,556
Program obligations	4,146			4,281
Other liabilities	27,209			42,716
Total liabilities (a)	1,116,878			1,329,736
Commitments and Contingencies (Note 13)
Redeemable noncontrolling interest	12,845			3,242
LIN Television Corporation stockholder's deficit:
Common Stock, $0.01 par value, 1,000 shares	—			—
Investment in parent company's stock, at cost	(21,984		)	(21,984		)
Additional paid-in capital	1,140,370			1,130,239
Accumulated deficit	(1,005,633		)	(1,164,435		)
Accumulated other comprehensive loss	(25,526		)	(35,384		)
Total stockholder's equity (deficit)	87,227			(91,564		)
Total liabilities and deficit	$	1,216,950		$	1,241,414

_______________________________________________________________________________

^(a)  Our consolidated assets as of December 31, 2013 and 2012 include total assets of $56,056 and $60,380, respectively, of variable interest entities ("VIEs") that can only be used to settle the obligations of the VIEs. These assets include broadcast licenses and other intangible assets of $44,677 and $46,604 and program rights of $2,186 and $2,060 as of December 31, 2013 and 2012, respectively. Our consolidated liabilities as of December 31, 2013 and 2012 include $4,126 and $4,577, respectively, of total liabilities of the VIEs for which the VIE's creditors have no recourse to the Company, including $2,727 and $4,152, respectively, of program obligations. See further description in Note 1—"Basis of Presentation and Summary of Significant Accounting Policies."

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

F-60

LIN Television Corporation

Consolidated Statements of Operations

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except per share data)
Net revenues	$	652,363		$	553,462		$	400,003
Operating expenses:
Direct operating	251,078			160,222			130,618
Selling, general and administrative	162,550			125,267			103,770
Amortization of program rights	29,242			23,048			21,406
Corporate	40,668			34,246			26,481
Depreciation	46,854			32,149			26,246
Amortization of intangible assets	22,826			6,364			1,199
Restructuring	3,895			1,009			707
Contract termination costs (Note 12)	3,887			—			—
Loss from asset dispositions	710			96			472
Operating income	90,653			171,061			89,104
Other expense:
Interest expense, net	56,627			46,683			50,706
Share of loss in equity investments	56			98,309			4,957
Gain on derivative instruments	—			—			(1,960		)
Loss on extinguishment of debt	—			3,341			1,694
Other expense, net	2,100			237			51
Total other expense, net	58,783			148,570			55,448
Income before (benefit from) provision for income taxes	31,870			22,491			33,656
(Benefit from) provision for income taxes	(125,420		)	40,463			(16,045		)
Income (loss) from continuing operations	157,290			(17,972		)	49,701
Discontinued operations:
Loss from discontinued operations, net of a benefit from income taxes of $541 and $595 for the years ended December 31, 2012 and 2011, respectively	—			(1,018		)	(920		)
Gain on sale of discontinued operations, net of a provision for income taxes of $6,223 for the year ended December 31, 2012	—			11,389			—
Net income (loss)	157,290			(7,601		)	48,781
Net (loss) income attributable to noncontrolling interests	(1,512		)	(556		)	204
Net income (loss) attributable to LIN Television Corporation	$	158,802		$	(7,045	)	$	48,577

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

F-61

LIN Television Corporation

Consolidated Statements of Comprehensive Income (Loss)

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Net income (loss)	$	157,290		$	(7,601	)	$	48,781
Pension net gain (loss), net of tax of $5,705, $1,523 and $(7,291) for the years ended December 31, 2013, 2012 and 2011, respectively	8,738			2,424			(11,212		)
Amortization of pension net losses, net of tax of $734, $609 and $379 for the years ended December 31, 2013, 2012 and 2011, respectively, reclassified	1,120			969			374
Comprehensive income (loss)	167,148			(4,208		)	37,943
Comprehensive (loss) income attributable to noncontrolling interest	(1,512		)	(556		)	204
Comprehensive income (loss) attributable to LIN Television Corporation	$	168,660		$	(3,652	)	$	37,739

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

F-62

LIN Television Corporation

Consolidated Statement of Stockholder's Equity

(in thousands, except share data)

	Common Stock			Investment in Parent Company's Common Shares (at cost)									Accumulated Other Comprehensive Loss
							Additional Paid-In Capital			Accumulated Deficit							Total Stockholder's Equity
	Shares	Amount
Balance at December 31, 2012	1,000	$	—	$	(21,984	)	$	1,130,239		$	(1,164,435	)	$	(35,384	)	$	(91,564	)
Pension liability adjustment, net of tax of $6,439	—	—		—			—			—			9,858			9,858
Issuance of LIN Media LLC class A common shares	—	—		—			1,256			—			—			1,256
Tax benefit from exercise of share options	—	—		—			1,591			—			—			1,591
Share-based compensation	—	—		—			9,284			—			—			9,284
Dividend declared	—	—		—			(2,000		)	—			—			(2,000		)
Net income	—	—		—			—			158,802			—			158,802
Balance at December 31, 2013	1,000	$	—	$	(21,984	)	$	1,140,370		$	(1,005,633	)	$	(25,526	)	$	87,227

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

F-63

LIN Television Corporation

Consolidated Statement of Stockholder's Deficit

(in thousands, except share data)

	Common Stock			Investment in Parent Company's Common Stock (at cost)								Accumulated Other Comprehensive Loss
							Additional Paid-In Capital		Accumulated Deficit							Total Stockholder's Deficit
	Shares	Amount
Balance at December 31, 2011	1,000	$	—	$	(10,598	)	$	1,122,133	$	(1,157,390	)	$	(38,777	)	$	(84,632	)
Pension liability adjustment, net of tax of $2,132	—	—		—			—		—			3,393			3,393
Stock-based compensation	—	—		—			8,106		—			—			8,106
Purchase of LIN TV Corp. class A common shares	—	—		(11,386		)	—		—			—			(11,386		)
Net loss	—	—		—			—		(7,045		)	—			(7,045		)
Balance at December 31, 2012	1,000	$	—	$	(21,984	)	$	1,130,239	$	(1,164,435	)	$	(35,384	)	$	(91,564	)

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

F-64

LIN Television Corporation

Consolidated Statements of Stockholder's Deficit

(in thousands, except share data)

	Common Stock			Investment in Parent Company's Common Stock (at cost)								Accumulated Other Comprehensive Loss
							Additional Paid-In Capital		Accumulated Deficit							Total Stockholder's Deficit
	Shares	Amount
Balance at December 31, 2010	1,000	$	—	$	(7,869	)	$	1,110,343	$	(1,205,967	)	$	(27,939	)	$	(131,432	)
Pension liability adjustment, net of tax of $(6,912)	—	—		—			—		—			(10,838		)	(10,838		)
Stock-based compensation	—	—		—			7,017		—			—			7,017
Issuance of LIN TV Corp. class A common stock				—			4,773								4,773
Purchase of LIN TV Corp. class A common stock	—	—		(2,729		)	—		—			—			(2,729		)
Net income	—	—		—			—		48,577			—			48,577
Balance at December 31, 2011	1,000	$	—	$	(10,598	)	$	1,122,133	$	(1,157,390	)	$	(38,777	)	$	(84,632	)

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

F-65

LIN Television Corporation

Consolidated Statements of Cash Flows

	Year ended December 31,
	2013			2012			2011
	(in thousands)
OPERATING ACTIVITIES:
Net income (loss)	$	157,290		$	(7,601	)	$	48,781
Loss from discontinued operations	—			1,018			920
Gain on sale of discontinued operations	—			(11,389		)	—
Adjustment to reconcile net income to net cash provided by operating activities:
Depreciation	46,854			32,149			26,246
Amortization of intangible assets	22,826			6,364			1,199
Amortization of financing costs and note discounts	3,638			2,589			3,755
Amortization of program rights	29,242			23,048			21,406
Cash payments for programming	(31,677		)	(24,258		)	(24,622		)
Loss on extinguishment of debt	—			1,830			1,694
Gain on derivative instruments	—			—			(1,960		)
Share of loss in equity investments	56			98,309			4,957
Deferred income taxes, net	(27,222		)	38,263			(16,586		)
Extinguishment of income tax liability related to the Merger	(131,481		)	—			—
Share-based compensation	9,374			6,857			6,176
Loss from asset dispositions	710			96			472
Other, net	(1,155		)	1,724			754
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(11,058		)	(33,403		)	(8,825		)
Other assets	(4,254		)	(2,146		)	(138		)
Accounts payable	(8,679		)	7,983			3,318
Income taxes payable	654			—			—
Accrued interest expense	4,327			1,746			(851		)
Other liabilities and accrued expenses	(9,889		)	6,256			(3,634		)
Net cash provided by operating activities, continuing operations	49,556			149,435			63,062
Net cash used in operating activities, discontinued operations	—			(2,736		)	(402		)
Net cash provided by operating activities	49,556			146,699			62,660
INVESTING ACTIVITIES:
Capital expenditures	(29,374		)	(28,230		)	(20,069		)
Change in restricted cash	—			255,159			(255,159		)
Payments for business combinations, net of cash acquired	(10,082		)	(358,495		)	(9,033		)
Proceeds from the sale of assets	86			79			74
Payments on derivative instruments	—			—			(2,020		)
Shortfall loans to joint venture with NBCUniversal	—			(2,292		)	(2,483		)
Capital contribution to joint venture with NBCUniversal	(100,000		)	—			—
Other investments, net	—			—			(375		)
Net cash used in investing activities, continuing operations	(139,370		)	(133,779		)	(289,065		)
Net cash provided by (used in) investing activities, discontinued operations	—			29,520			(115		)
Net cash used in investing activities	(139,370		)	(104,259		)	(289,180		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director share-based compensation	1,256			1,314			841
Tax benefit from exercises of share options	1,591			—			—
Proceeds from borrowings on long-term debt	141,000			328,333			417,695
Payment of dividend	(2,000		)	—			—
Principal payments on long-term debt	(85,160		)	(322,179		)	(175,216		)
Payment of long-term debt issue costs	(655		)	(10,272		)	(7,662		)
Treasury shares purchased	—			(11,386		)	(2,729		)
Net cash provided by (used in) financing activities	56,032			(14,190		)	232,929
Net (decrease) increase in cash and cash equivalents	(33,782		)	28,250			6,409
Cash and cash equivalents at the beginning of the period	46,307			18,057			11,648
Cash and cash equivalents at the end of the period	$	12,525		$	46,307		$	18,057

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

F-66

LIN Television Corporation

Notes to Consolidated Financial Statements

Note 1—Basis of Presentation and Summary of Significant Accounting Policies

Principles of Consolidation

LIN Television Corporation, a Delaware corporation (“LIN Television”), together with its subsidiaries, is a local multimedia company operating in the United States. LIN Television and its subsidiaries are affiliates of Hicks, Muse & Co. Partners, L.P. (“HMC”). In these notes, the terms “Company,” “we,” “us” or “our” mean LIN Television and all subsidiaries included in our consolidated financial statements. LIN Television is a wholly-owned subsidiary of LIN Media LLC, a Delaware limited liability company (“LIN LLC”).

On July 30, 2013, LIN TV Corp., a Delaware corporation (“LIN TV”), completed its merger with and into LIN LLC, a Delaware limited liability company and wholly owned subsidiary of LIN TV, with LIN LLC as the surviving entity (the “Merger”) pursuant to the Agreement and Plan of Merger, dated February 12, 2013, by and between LIN TV and LIN LLC (the “Merger Agreement”). Entry into the Merger Agreement had previously been announced by LIN TV on its Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on February 15, 2013.

LIN LLC filed a Current Report on Form 8-K on July 31, 2013 (the “Form 8-K”) for the purpose of establishing LIN LLC as the successor registrant to LIN TV pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and to disclose certain related matters, including the consummation of the Merger. Pursuant to Rule 12g-3(a) under the Exchange Act and in accordance with the filing of the Form 8-K, the class A common shares representing limited liability interests in LIN LLC, as the successor registrant to LIN TV, were deemed registered under Section 12(b) of the Exchange Act. References to "LIN LLC," "we," "us," or the "Company" in this Annual Report on Form 10-K that include any period at and before the effectiveness of the Merger shall be deemed to refer to LIN TV as the predecessor registrant to LIN LLC. For more information concerning the effects of the Merger and the succession of LIN LLC to LIN TV upon its effectiveness, please see the Form 8-K.

LIN LLC's assets, liabilities, and operations relate solely to the administration of the LIN LLC partnership. LIN LLC guarantees all of our debt. All of the consolidated wholly-owned subsidiaries of LIN Television fully and unconditionally guarantee our Senior Secured Credit Facility, 8³/₈% Senior Notes due 2018 (the “8³/₈% Senior Notes”) and 6³/₈% Senior Notes due 2021 (the “6³/₈% Senior Notes”) on a joint-and-several basis, subject to customary release provisions.

Our consolidated financial statements reflect the operations of WWHO-TV in Columbus, OH and WUPW-TV in Toledo, OH as discontinued for all periods presented. See Note 3—“Discontinued Operations” for further discussion of our discontinued operations.

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain changes in classifications have been made to the prior period financial statements to conform to the current financial statement presentation. Our significant accounting policies are described below.

The accompanying consolidated financial statements include the accounts of our Company, our wholly-owned and majority-owned and controlled subsidiaries, and variable interest entities ("VIEs") for which we are the primary beneficiary. We review all local marketing agreements (“LMAs”), shared services agreements (“SSAs”) or joint sales agreements (“JSAs”), to evaluate whether consolidation of entities party to such arrangements is required. All intercompany accounts and transactions have been eliminated. We conduct our business through our subsidiaries and have no operations or assets other than our investment in our subsidiaries and equity-method investments.

As of January 1, 2014, we began operating under two segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes forty-three television stations and seven digital channels that are either owned, operated or serviced by us in twenty-three U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites. Our Digital segment includes the operating results of our digital companies: LIN Digital LLC ("LIN Digital"), LIN Mobile, LLC ("LIN Mobile"), Nami Media, Inc. ("Nami Media"), HYFN, Inc. ("HYFN"), Dedicated Media, Inc. ("Dedicated Media"), and Federated Media Publishing LLC (acquired in February 2014) ("Federated Media"). Corporate and unallocated expenses primarily include our costs to operate as a public company and to operate our corporate locations. Corporate is not a reportable segment. We have retrospectively recast prior period disclosures to reflect this change in our reportable operating segments. See Note 19 - “Segment Reporting” for further discussion. Prior to January 1, 2014, we had one reportable segment.

Joint Venture Sale Transaction

On February 12, 2013, we, along with LIN TV and our wholly-owned subsidiary, LIN Television of Texas, L.P., a Delaware limited partnership (“LIN Texas”) entered into and closed the transactions contemplated by a transaction agreement (the

F-67

LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

“Transaction Agreement”) with NBC Telemundo License LLC, a Delaware limited liability company (“NBC”), NBCU New LLC I, a Delaware limited liability company, NBCU New LLC II, a Delaware limited liability company, General Electric Company, a New York corporation (“GE”), General Electric Capital Corporation, a Delaware corporation (“GECC” and together with GE, the “GE Parties”), National Broadcasting Company Holding, Inc., a Delaware corporation, Comcast Corporation, a Pennsylvania corporation (“Comcast”), NBCUniversal Media, LLC, a Delaware limited liability company (“NBCUniversal”), Lone Star SPV, LLC, a Delaware limited liability company and Station Venture Holdings, LLC, a Delaware limited liability company (“SVH”). SVH held a 99.75% interest in Station Venture Operations, LP (“SVO”), which is the operating company that managed KXAS-TV and KNSD-TV, the television stations that comprised the joint venture. The Transaction Agreement effected a series of transactions related to the ownership and sale of LIN Texas’s 20.38% equity interest in SVH, a joint venture in which NBC, an affiliate of NBCUniversal, held the remaining 79.62% equity interest (collectively, the “JV Sale Transaction”).

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

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

Pursuant to the JV Sale Transaction, in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations related to any shortfall funding agreements. Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal, and the LIN parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00. As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee.

We accrued for and expensed the $100 million capital contribution to SVH to secure the release of the GECC Guarantee and recorded the related tax effects of the JV Sale Transaction and the capital contribution in our consolidated financial statements as of December 31, 2012 because it represented a probable and estimable obligation of the Company. In February 2013, we entered into a $60 million incremental term loan facility and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million capital contribution. As a result of the JV Sale Transaction, LIN TV, after utilizing all of its available federal net operating loss carryforwards to offset the taxable gain recognized in such transaction, we had a $162.8 million income tax payable associated with this transaction remaining, $131.5 million of which was extinguished as a result of the closing of the transactions contemplated by the Merger Agreement further described below.

Concurrent with the closing of the JV Sale Transaction, LIN TV entered into the Merger Agreement with LIN LLC as described above. The Merger enabled the surviving entity to be classified as a partnership for federal income tax purposes, and the change in classification was treated as a liquidation of LIN TV for federal income tax purposes, and LIN TV realized a capital loss in its 100% equity interest in LIN Television.

Based on an average of the opening and closing trading prices of LIN TV's class A common stock on the day of the Merger, LIN TV realized a capital loss in the amount of approximately $343 million, which represented the difference between its tax basis in the stock of LIN Television, and the fair market value of such stock as of July 30, 2013. The capital loss realized and existing net operating losses were used to offset a portion of the capital gain recognized in the JV Sale Transaction and, we realized cash savings of $131.5 million, resulting in a remaining tax liability of $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this tax liability during the fourth quarter of 2013.

Variable Interest Entities

In determining whether we are the primary beneficiary of a VIE for financial reporting purposes, we consider whether we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and whether we have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. We consolidate VIEs when we are the primary beneficiary.

We have a JSA and an SSA with WBDT Television, LLC ("WBDT"), a third party licensee, for WBDT-TV in the Dayton, OH market. We also have JSAs and SSAs with affiliates of Vaughan Acquisition LLC ("Vaughan"), a third party licensee, for

F-68

LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

WTGS-TV in the Savannah, GA market, WYTV-TV in the Youngstown, OH market and KTKA-TV in the Topeka, KS market and SSAs with KASY-TV Licensee, LLC ("KASY"), a third-party licensee, for KWBQ-TV in the Santa Fe, NM market, KRWB-TV in the Roswell, NM market and KASY-TV in the Albuquerque, NM market. Under these agreements, we provide administrative services to these stations, have an obligation to reimburse certain of the stations' expenses, and we are compensated through a performance-based fee structure that provides us the benefit of certain returns from the operation of these stations.

We determined that WBDT, Vaughan and KASY are VIEs and as a result of the JSAs and/or SSAs, we have variable interests in these entities. We are the primary beneficiary of these entities, and therefore, we consolidate these entities within our consolidated financial statements.

The carrying amounts and classifications of the assets and liabilities of the variable interest entities described above, which have been included in our consolidating balance sheets as of December 31, 2013 and 2012 were as follows (in thousands):

	December 31,
	2013		2012
ASSETS
Current assets:
Cash and cash equivalents	$	278	$	418
Accounts receivable, net	6,345		6,021
Other assets	927		2,092
Total current assets	7,550		8,531
Property and equipment, net	2,469		3,190
Broadcast licenses and other intangible assets, net	44,677		46,604
Other assets	1,360		2,055
Total assets	$	56,056	$	60,380
LIABILITIES
Current liabilities:
Current portion of long-term debt	$	1,162	$	1,451
Accounts payable	63		—
Accrued expenses	1,336		425
Program obligations	1,303		2,185
Total current liabilities	3,864		4,061
Long-term debt, excluding current portion	3,005		3,950
Program obligations	1,424		1,967
Other liabilities	47,763		50,402
Total liabilities	$	56,056	$	60,380

The assets of our consolidated VIEs can only be used to settle the obligations of the VIEs, and may not be sold, or otherwise disposed of, except for assets sold or replaced with others of like kind or value. Other liabilities of $47.8 million and $50.4 million as of December 31, 2013 and 2012, respectively, serve to reduce the carrying value of the entities and are eliminated in our consolidated financial statements. This reflects the fact that as of December 31, 2013 and 2012, LIN Television has an option that it may exercise if the Federal Communications Commission ("FCC") attribution rules change. The option would allow LIN Television to acquire the assets or member's interest of the VIE entities for a nominal exercise price, which is significantly less than the carrying value of their tangible and intangible net assets.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the notes thereto. Our actual results could differ from these estimates. Estimates are used for the allowance for doubtful accounts in receivables, valuation of goodwill and intangible assets, assumptions used to determine fair value of financial instruments, amortization and impairment of program rights and intangible assets, share-based compensation and other long-term incentive compensation arrangements, pension costs, barter

F-69

LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

transactions, income taxes, employee medical insurance claims, useful lives of property and equipment, contingencies, litigation and net assets of businesses acquired.

Cash and cash equivalents

Cash equivalents consist of highly liquid, short-term investments that have an original maturity of three months or less when purchased. All of our available cash is on deposit with banking institutions that we believe to be financially sound. We had no material losses on our cash or cash equivalents during 2013.

Property and equipment

Property and equipment is recorded at cost and is depreciated using the straight-line method over the estimated useful lives of the assets, which are an average of 30 to 40 years for buildings and fixtures, and 3 to 15 years for broadcast and other equipment. Upon retirement or other disposition, the cost and related accumulated depreciation of the assets are removed from the accounts and the resulting gain or loss is included in consolidated net income or loss. Expenditures for maintenance and repairs, including expenditures for planned major maintenance activities, are expensed as incurred. We review our property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

Equity investments

Equity investments that we do not have a controlling interest in are accounted for using the equity method. Our share of the net income or loss for these investments, including any equity investment impairments or payments under related guarantees, is included in share of loss from equity investments on our consolidated statement of operations. We review our interest in our equity investments for impairment if there is a series of operating losses or other factors that may indicate that there is a decrease in the value of our investment that is other than temporary.

Revenue recognition

We recognize local, national and political advertising sales, net of agency commissions, during the period in which the advertisements or programs are aired on our television stations, and when payment is reasonably assured. Internet and mobile advertisement sales are recognized when the advertisement is displayed on our websites or the websites of our advertising network. We recognize retransmission consent fees in the period in which our service is delivered. Revenue generated by our digital companies is recognized over the service delivery period when necessary provisions of the contracts have been met. In addition, for the sale of third-party products and services by our digital companies, we evaluate whether it is appropriate to recognize revenue based on the gross amount billed to the customer or the net amount retained by us.

Barter transactions

We account for barter transactions at the fair value of the goods or services we receive from our customers, or the advertising time provided, whichever is more clearly indicative of fair value based on the judgment of our management. We record barter advertising revenue at the time the advertisement is aired and barter expense at the time the goods or services are used. We account for barter programs at fair value based on a calculation using the actual cash advertisements we sell within barter programs multiplied by one minus the program profit margin for similar syndicated programs where we pay cash to acquire the program rights. We record barter program revenue and expense when we air the barter program. We do not record barter revenue or expenses related to network programs. Barter revenue and expense included in the consolidated statements of operations are as follows (in thousands):

	Year Ended December 31,
	2013			2012			2011
Barter revenue	$	5,552		$	4,220		$	4,071
Barter expense	(5,455		)	(4,176		)	(3,967		)

Advertising expense

Advertising costs are expensed as incurred. We incurred advertising costs in the amounts of $3.9 million, $3.1 million and $2.6 million for the years ended December 31, 2013, 2012 and 2011, respectively.

F-70

LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

Intangible assets

Intangible assets primarily include broadcast licenses, network affiliations, customer relationships, completed technology, non-compete agreements and goodwill.

We consider our broadcast licenses to be indefinite-lived intangible assets and as a result, we test the impairment of our broadcast licenses annually or whenever events or changes in circumstances indicate that such assets might be impaired. The use of an indefinite life for our broadcast licenses is based on our ability to renew the licenses and that such renewals generally may be obtained indefinitely and at little cost and that the technology used in broadcasting is not expected to be replaced in the foreseeable future. Therefore, cash flows derived from the broadcast licenses are expected to continue indefinitely. We proceed directly to the first step of the impairment test without attempting to qualitatively assess whether an impairment was more likely than not. The impairment test consists of a comparison of the fair value of broadcast licenses with their carrying amount on a station-by-station basis using a discounted cash-flow valuation method, assuming a hypothetical start-up scenario. The future value of our broadcast licenses could be significantly impaired by the loss of the corresponding network affiliation agreements. Accordingly, such an event could trigger an assessment of the carrying value of a broadcast license.

We test the impairment of goodwill annually or whenever events or changes in circumstances indicate that goodwill might be impaired. We proceed directly to the first step of the impairment test without attempting to qualitatively assess whether an impairment was more likely than not. Our reporting units are comprised of each of the markets in which our television stations operate, LIN Digital, Nami Media, Dedicated Media, Inc. ("Dedicated Media") and HYFN, Inc. ("HYFN"). The first step of the goodwill impairment test compares the fair value of a reporting unit with its carrying amount, including goodwill. The fair value of a reporting unit is determined through the use of a discounted cash flow analysis. The valuation assumptions used in the discounted cash flow model reflect historical and projected performance of the reporting unit and prevailing values in the markets for similar assets. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not considered impaired. If the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of goodwill with the carrying amount of that goodwill. The implied fair value of goodwill is determined by performing a hypothetical purchase price allocation, using the reporting unit's fair value (as determined in step one) as the purchase price. If the carrying amount of goodwill exceeds the implied fair value, an impairment charge is recognized in an amount equal to that excess, but not more than the carrying value of the goodwill. An impairment assessment could be triggered by a significant reduction, or a forecast of such reductions, in operating results or cash flows at one or more of our reporting units, a significant adverse change in the national or local advertising marketplaces in which our television stations operate, or by adverse changes to FCC ownership rules, among other factors. We recorded an impairment charge during 2011, which is more fully described in Note 6 -"Intangible Assets."

Long-lived assets

We periodically evaluate the net realizable value of long-lived assets, including tangible and intangible assets, relying on a number of factors including operating results, business plans, economic projections and anticipated future cash flows. When evaluating assets for potential impairment, we first compare the carrying amount of the asset group to the estimated future cash flows associated with the asset group (undiscounted and without interest charges). If the estimated future cash flows used in this analysis are less than the carrying amount of the asset group, an impairment loss calculation is prepared. The impairment loss calculation compares the carrying amount of the asset group to the asset group's estimated future cash flows (discounted and with interest charges). If required, an impairment loss is recorded for the portion of the asset group's carrying value that exceeds the asset group's estimated future cash flows.

Program rights

Program rights are recorded as assets when the license period begins and the programs are delivered to our stations for broadcasting, at the gross amount of the related obligations. Costs incurred in connection with the purchase of programs to be broadcast within one year are classified as other current assets, while costs of those programs to be broadcast subsequently are considered non-current. Program costs are charged to operations over their estimated broadcast periods in a manner consistent with actual usage.

If the estimated net realizable value of acquired programming rights is less than unamortized cost (i.e. due to poor ratings), we would recognize an impairment charge to reduce the carrying value of the program rights to their net realizable value.

Program obligations are classified as current or non-current in accordance with the payment terms of the license agreement.

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LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

Share-based compensation

As of December 31, 2013, we have several share-based employee compensation plans, which are described more fully in Note 9—"Share-Based Compensation." We estimate the fair value of share option awards using a Black-Scholes valuation model. The Black-Scholes valuation model requires us to make assumptions and judgments about the variables used in the calculation, including the option's expected term, the expected volatility of the underlying shares and the number of share option awards that are expected to be forfeited. The expected term represents the weighted-average period of time that options granted are expected to be outstanding giving consideration to vesting schedules and our historical exercise patterns. Expected volatility is based on historical trends for LIN LLC's class A common shares over the expected term. Expected forfeitures are estimated using our historical experience. If future changes in estimates differ significantly from our current estimates, our future share-based compensation expense and results of operations could be materially impacted.

The following table presents the share-based compensation expense included in our consolidated statements of operations (in thousands):

	Year Ended December 31,
	2013		2012		2011
Direct operating	$	320	$	270	$	256
Selling, general and administrative	1,460		1,019		1,266
Corporate	7,594		5,568		4,654
Total share-based compensation	$	9,374	$	6,857	$	6,176

Our accounting policy is to follow the tax law ordering approach regarding net operating losses and determining when tax benefits are realized related to excess share option deductions and credited to paid-in capital.

Income taxes

Deferred income taxes are recognized based on temporary differences between the financial statement and the tax basis of assets and liabilities using statutory tax rates in effect in the years in which the temporary differences are expected to reverse. We consider future taxable income and feasible tax planning strategies in assessing the need for establishing or removing a valuation allowance. We record or subsequently remove a valuation allowance to reflect our deferred tax assets to an amount that is more likely than not to be realized. In the event that our determination changes regarding the realization of all or part of our deferred tax assets in the future, an adjustment to the deferred tax asset is recorded to our consolidated statement of operations in the period in which such a determination is made. Due to the change in tax structure as a result of the Merger, we reversed an$18.2 million valuation allowance and recognized a corresponding tax benefit during 2013. For further discussion regarding this reversal, see Note 14 - "Income Taxes."

When accounting for uncertainty in income taxes, we follow the prescribed recognition threshold and measurement methodology for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. We recognize interest and penalties related to uncertain tax positions as a component of income tax expense.

Concentration of credit risk

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents and trade receivables. Concentration of credit risk with respect to cash and cash equivalents and investments are limited as we maintain primary banking relationships with only large nationally recognized institutions. We evaluated the viability of these institutions as of December 31, 2013 and we believe our risk is minimal. Credit risk with respect to trade receivables is limited, as our trade receivables are primarily related to advertising revenues generated from a large diversified group of local and nationally recognized advertisers and advertising agencies. We do not require collateral or other security against trade receivable balances, however, we do maintain reserves for potential bad debt losses, which are based on historical bad debt experience and an assessment of specific risks, and such reserves and bad debts have been within management's expectations for all years presented.

Fair value of financial instruments

Certain financial instruments, including cash and cash equivalents, investments, accounts receivable and accounts payable are carried in the consolidated financial statements at amounts that approximate fair value. For certain financial assets and liabilities

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LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

recorded at fair value on a recurring basis we maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Derivative financial instruments

Derivatives are required to be recorded as assets or liabilities and measured at fair value. Gains or losses resulting from changes in the fair values of derivatives are recognized immediately or deferred, depending on the use of the derivative and whether or not it qualifies as a hedge. We have historically used derivative financial instruments in the management of our interest rate exposure for our long-term debt. In accordance with our interest rate risk management policy, we do not enter into derivative financial instruments unless there is an underlying exposure, and we do not enter into derivative financial instruments for speculative trading purposes.

Retirement plans

We have a defined benefit retirement plan covering certain of our employees. Our pension benefit obligations and related costs are calculated using prescribed actuarial concepts. Additionally, we record the unfunded status of our plan on our consolidated balance sheets. Effective April 1, 2009, this plan was frozen and we do not expect to make additional benefit accruals to this plan, however, we continue to fund our existing vested obligations.

Redeemable noncontrolling interest

The following table presents the activity of the redeemable noncontrolling interest included in our consolidated balance sheets related to Nami Media, HYFN and Dedicated Media, which represents third parties’ proportionate share of our consolidated net assets (in thousands):

	Redeemable Noncontrolling Interest
Acquisition of redeemable noncontrolling interest	$	3,503
Net loss	(556		)
Share-based compensation	295
Balance as of December 31, 2012	3,242
Acquisition of redeemable noncontrolling interest	11,025
Net loss	(1,512		)
Share-based compensation	90
Balance as of December 31, 2013	$	12,845

Recently issued accounting pronouncements

In July 2013 the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” to eliminate diversity in practice. This ASU requires that companies net their unrecognized tax benefits against all same-jurisdiction net operating losses or tax credit carryforwards that would be used to settle the position with a tax authority. This new guidance is effective prospectively for annual reporting periods beginning on or after December 15, 2013 and interim periods therein. We prospectively adopted this guidance effective January 1, 2013 and it did not have a material impact on our financial statements.

In February 2013, the Financial Accounting Standards Board issued Accounting Standards Update No. 2013-2, “Reporting of Amounts Reclassified out of Accumulated Other Comprehensive Income,” which amends Accounting Standards Codification 220, “Comprehensive Income.” The amendments require an entity to disclose the impact of amounts reclassified out of accumulated other comprehensive income and into net income, by the respective line items of net income, if the amounts reclassified are reclassified to net income in their entirety in the same reporting period. The disclosure is required either on the face of the statement where net income is presented or in the notes. For amounts that are not reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. We prospectively adopted this guidance effective January 1, 2013 and it did not have a material impact on our financial statements.

In July 2012, there were revisions to the accounting standard for impairment tests of indefinite-lived intangible assets other than goodwill. Under the revised standard a company can first perform a qualitative assessment to determine whether further impairment testing of indefinite-lived intangible assets is necessary. A company can choose to perform the qualitative assessment

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LIN Television Corporation

Notes to Consolidated Financial Statements (continued)

on none, some, or all of its indefinite-lived intangible assets, and can also bypass the qualitative assessment and perform the quantitative impairment test for any indefinite-lived intangible in any period. The revised standard is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. We adopted this guidance effective January 1, 2013 and do not expect it to have a material impact on our impairment tests of indefinite-lived intangible assets.

Note 2—Acquisitions

Federated Media Publishing, Inc.

On February 3, 2014, LIN Digital Media LLC, a wholly owned subsidiary of LIN Television, acquired 100% of the capital stock of Federated Media Publishing, Inc. ("Federated Media"). Federated Media is a digital content and conversational marketing company that leverages the relationships and content from its publishing network to deliver contextually relevant advertising and conversational and engagement tools that reach agencies’ and brands’ targeted audiences across digital and social media platforms. The purchase price totaled $22.4 million plus an adjustment for working capital delivered at closing and was funded from cash on hand and amounts drawn on our revolving credit facility.

We are in the process of making preliminary estimates of the fair value of the assets acquired and liabilities assumed of Federated Media, utilizing information available at the time of this report and these estimates are subject to refinement until all pertinent information has been obtained. We expect to complete the process of finalizing the purchase accounting and final estimates of fair value of assets and liabilities during the twelve months following the acquisition.

Dedicated Media, Inc.

On April 9, 2013, we acquired a 60% interest (calculated on a fully diluted basis) in Dedicated Media, a multi-channel advertisement buying and optimization company. Dedicated Media employs new technologies to create, plan and execute digital marketing campaigns on behalf of its clients. The purchase price totaled $5.8 million, which was funded from cash on hand at the time of the acquisition.

Under the terms of our agreement with Dedicated Media, we agreed to purchase the remaining outstanding shares of Dedicated Media by no later than February 15, 2015 if Dedicated Media achieves both (i) a target earnings before interest, taxes, depreciation and amortization (“EBITDA”) and (ii) a target gross profit in 2014, as outlined in the purchase agreement. The purchase price of these shares is based on multiples of Dedicated Media’s 2014 EBITDA and gross profit. Our maximum potential obligation under the purchase agreement is $26 million. If Dedicated Media does not meet the target EBITDA or target gross profit in 2014, we have the option to purchase the remaining outstanding shares using the same purchase price multiple.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by us in the acquisition (in thousands):

Current assets	$	7,315
Equipment	99
Definite-lived intangible assets	4,620
Goodwill	1,854
Current liabilities	(4,302		)
Noncontrolling interest	(3,834		)
Total	$	5,752

The amount allocated to definite-lived intangible assets represents the estimated fair values of customer relationships of $3.9 million, completed technology of $0.5 million, and trademarks of $0.2 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 8 years for customer relationships, 4 years for completed technology and 2 years for trademarks.

HYFN, Inc.

On April 4, 2013, we acquired a 50.1% interest (calculated on a fully diluted basis) in HYFN, a full service digital advertising agency specializing in the planning, development, deployment and support for websites, mobile sites, interactive banners, games and various applications for multiple devices. The purchase price totaled $7.2 million, $6.9 million of which was funded from cash on hand and $0.3 million was accrued at the time of the acquisition and was subsequently paid in accordance with the provisions of the purchase agreement during the first quarter of 2014.

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Under the terms of our agreement with HYFN, we agreed to purchase the remaining outstanding shares of HYFN by no later than February 15, 2016 if HYFN achieves both (i) a target EBITDA and (ii) target net revenues in 2015, as outlined in the transaction agreements. The purchase price of these shares is based on multiples of HYFN’s 2015 net revenue and EBITDA. Our maximum potential obligation under the terms of our agreement is approximately $62.4 million. If HYFN does not meet the target EBITDA or target net revenues in 2015, we have the option to purchase the remaining outstanding shares using the same purchase price multiple.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by us in the acquisition (in thousands):

Current assets	$	3,759
Non-current assets	13
Equipment	179
Definite-lived intangible assets	3,580
Goodwill	9,160
Current liabilities	(920		)
Non-current liabilities	(1,361		)
Noncontrolling interest	(7,191		)
Total	$	7,219

The amount allocated to definite-lived intangible assets represents the estimated fair values of customer relationships of $2.4 million, completed technology of $1.1 million, and trademarks of $0.1 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 8 years for customer relationships, 3 years for completed technology and 3 years for trademarks.

Goodwill of $1.9 million and $9.2 million is the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired, and primarily represents the benefits of the incremental revenue we expect to generate from the acquisitions of Dedicated Media and HYFN, respectively. None of the goodwill recognized in connection with the acquisitions of Dedicated Media and HYFN is deductible for tax purposes.

Our obligations to purchase the noncontrolling interest holders’ shares of both Dedicated Media and HYFN are outside of our control, because they are based on the achievement of certain financial targets described above. Therefore, the noncontrolling interest related to Dedicated Media and HYFN as of December 31, 2013 has been reported as redeemable noncontrolling interest and classified as temporary equity on our consolidated balance sheets. As of the acquisition dates, the fair values of the noncontrolling interests were $3.8 million and $7.2 million for Dedicated Media and HYFN, respectively, and were measured based on the purchase prices for our 60% and 50.1% ownership interest in Dedicated Media and HYFN, respectively, and the net assets acquired as of the acquisition dates. As of December 31, 2013, we believe that achievement of the financial targets is not yet probable and therefore, have not reflected these obligations in our consolidated financial statements.

If we do not purchase the remaining outstanding shares of Dedicated Media or HYFN by the dates set forth in the respective purchase agreements, the noncontrolling interest holders have the right to purchase our interest. The purchase price of these shares is based on the same purchase price multiple described above and is exercisable only if the applicable financial targets are not met and we do not elect to purchase the remaining interest. The fair value of our elective purchase options, and the fair value of the options held by the noncontrolling interest holders is zero and no amounts related to these options are included in our consolidated financial statements as of December 31, 2013.

Net revenues and operating loss of HYFN and Dedicated Media included in our consolidated statements of operations for the year ended December 31, 2013 were $24.2 million and $(2.8) million, respectively.

New Vision Acquisition

On October 12, 2012, we completed our acquisition of television stations in eight markets that were previously owned by affiliates of New Vision Television, LLC ("New Vision") for $334.9 million, subject to certain post-closing adjustments, and including the assumption of $14.3 million of finance lease obligations. Concurrent with the acquisition, Vaughan, a third-party licensee, completed its acquisition of separately owned television stations (the "Vaughan Acquired Stations") in three markets for $4.6 million from PBC Broadcasting, LLC ("PBC").

We also agreed to provide certain services to the Vaughan Acquired Stations pursuant to SSAs with Vaughan. Under the SSAs with Vaughan, we provide sales, administrative and technical services, supporting the business and operation of the Vaughan

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Acquired Stations in exchange for commissions and fees that provide us the benefit of certain returns from the business of the Vaughan Acquired Stations.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by both us and Vaughan in the acquisition (in thousands):

Program rights assets	$	2,040
Property and equipment	100,124
Broadcast licenses	133,120
Definite-lived intangible assets	55,837
Goodwill	65,024
Current liabilities	(417		)
Non-current liabilities	(2,239		)
Long-term debt assumed	(13,989		)
Total	$	339,500

The amount allocated to definite-lived intangible assets represents the estimated fair values of network affiliations of $30.8 million, favorable leases of $8.6 million, advertiser relationships of $6.1 million, retransmission consent agreements of $7 million, and other intangible assets of $3.3 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 2 years for network affiliations, 32 years for favorable leases, 10 years for advertiser relationships, 5 years for retransmission consent agreements, and a weighted average life of 6 years for other intangible assets.

The results of operations for the year ended December 31, 2012 include the results of the New Vision stations since October 12, 2012. Net revenues and operating income of the television stations acquired during 2012 included in our consolidated statements of operations for the year ended December 31, 2012 were $40 million and $11.2 million, respectively.

Pro Forma Information

The following table sets forth unaudited pro forma results of operations, assuming that the acquisition of the television stations from New Vision, along with transactions necessary to finance the acquisition, occurred on January 1, 2011 (in thousands):

	2012			2011
Net revenue	$	658,163		$	514,340
Net (loss) income	$	(11,720	)	$	23,950
Basic (loss) income per common share attributable to LIN LLC	$	(0.22	)	$	0.43
Diluted (loss) income per common share attributable to LIN LLC	$	(0.22	)	$	0.42

This pro forma financial information is based on historical results of operations, adjusted for the allocation of the purchase price and other acquisition accounting adjustments, and is not necessarily indicative of what our results would have been had we operated the businesses since January 1, 2011. The pro forma adjustments reflect depreciation expense, amortization of intangibles and amortization of program contract costs related to the fair value adjustments of the assets acquired, additional interest expense related to the financing of the transactions, exclusion of nonrecurring financing and transaction related costs and the related tax effects of the adjustments.

In connection with the acquisition of television stations from New Vision, we and New Vision incurred a combined total of $7.3 million of transaction related costs primarily related to legal and other professional services. These costs were not included in the 2012 pro forma amounts. The 2011 pro forma net income was adjusted to include these costs, as they are directly attributable to the acquisition.

ACME Television Acquisition

On December 10, 2012, we acquired certain assets of the ACME Television, LLC ("ACME") television stations KWBQ-TV, KRWB-TV and KASY-TV (collectively the "Acquired Stations"), each of which serves the Albuquerque-Santa Fe, NM market. KASY-TV Licensee, LLC ("KASY"), an unrelated third party, acquired the remaining assets of the Acquired Stations, including the FCC license. The aggregate purchase price for the Acquired Stations was $19 million, of which we paid approximately $17.3 million and KASY paid approximately $1.7 million.

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We also agreed to provide certain services to the Acquired Stations pursuant to shared services arrangements with KASY. Under the shared services arrangements with KASY, we provide sales, administrative and technical services, supporting the business and operation of the Acquired Stations in exchange for commissions and fees that provide us the benefit of certain returns from the business of the Acquired Stations.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by both us and KASY in the acquisitions (in thousands):

Current assets	$	1,656
Non-current assets	1,968
Other intangible assets	12,898
Goodwill	5,331
Non-current liabilities	(2,858		)
Total	$	18,995

Goodwill of $65 million and $5.3 million is the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired, and primarily represents the benefits of synergies and economies of scale we expect to realize from the acquisitions of the television stations from New Vision and ACME, respectively. All of the goodwill recognized in connection with the acquisitions of New Vision and ACME is deductible for tax purposes.

During the year ended December 31, 2013, certain measurement period adjustments were made to the initial allocation performed in the fourth quarter of 2012 for the New Vision and ACME acquisitions, which were not material to the consolidated financial statements.

Nami Media, Inc.

On November 22, 2011, we acquired a 57.6% interest (a 50.1% interest calculated on a fully diluted basis) in Nami Media Inc. ("Nami Media"), a digital advertising management and technology company. During 2013, Nami Media did not achieve the minimum threshold of earnings before interest, taxes, depreciation and amortization ("EBITDA") required to obligate us to acquire the remaining outstanding shares. As of the date of this report, we have not exercised our option to acquire the remaining outstanding shares.

Note 3—Discontinued Operations

WWHO-TV

On February 16, 2012, we completed the sale of substantially all of the assets of WWHO-TV, our CW affiliate serving Columbus, OH. During the year ended December 31, 2012, we recorded a loss on the sale of WWHO-TV of $0.4 million ($0.3 million, net of tax).

WUPW-TV

On April 21, 2012, we completed the sale of substantially all of the assets of WUPW-TV to WUPW, LLC. During the year ended December 31, 2012, we recorded a gain on the sale of WUPW-TV of $18 million ($11.7 million, net of tax).

The following presents summarized information for the discontinued operations as follows (in thousands):

	2012									2011
	WWHO- TV			WUPW- TV			Total			WWHO- TV			WUPW- TV		Total
Net revenues	$	440		$	2,193		$	2,633		$	4,236		$	7,585	$	11,821
Operating (loss) income	(393		)	(1,166		)	(1,559		)	(699		)	1,079		380
Net (loss) income	(252		)	(766		)	(1,018		)	(1,427		)	507		(920		)

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Note 4—Investments

Joint Venture with NBCUniversal    

As of December 31, 2012, we held a 20.38% interest in SVH, a joint venture with NBCUniversal, and accounted for our interest using the equity method, as we did not have a controlling interest. SVH held a 99.75% interest in SVO, which is the operating company that managed KXAS-TV and KNSD-TV, the television stations that comprised the joint venture.

As further described in Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies" and Note 13—"Commitments and Contingencies," on February 12, 2013, LIN TV, LIN Television, and LIN Texas entered into and simultaneously closed the transactions contemplated by the Transaction Agreement among subsidiaries of NBCUniversal, Comcast, the GE Parties, and SVH.

Pursuant to the JV Sale Transaction, in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations related to any shortfall funding agreements. Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal , and the LIN parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00. As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee.

The following table presents summarized financial information of SVH and SVO for the period from January 1, 2013 through February 12, 2013 and the years ending December 31, 2012 and 2011 (in thousands):

	January1 - February 12,			Year Ended December 31,
	2013			2012			2011
SVO:
Net revenues	$	11,951		$	143,474		$	118,833
Operating expenses	(9,148		)	(79,124		)	(71,350		)
Net income before taxes	2,805			64,653			47,791
Net income after taxes	2,793			64,515			47,743
SVH:
Equity in income from limited partnership in SVO	$	2,786		$	64,354		$	47,624
Interest and other expense	(8,039		)	(69,365		)	(68,003		)
Net loss	(5,253		)	(5,011		)	(20,379		)
Cash distributions to SVH from SVO	6,905			55,025			53,846
Shortfall loans from LIN Television to SVH	—			2,292			2,483
Shortfall loans from General Electric Company ("GE") to SVH	—			8,954			9,701

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	February 12,		December 31,
	2013 (2)		2012
SVH:
Cash and cash equivalents	$	6,905	$	—
Non-current assets	205,433		209,552
Current liabilities	8,155		544
Non-current liabilities(1)	865,354		864,927
Shortfall loans outstanding and accrued interest payable to LIN Television from SVH	10,159		10,080
Shortfall loans outstanding and accrued interest payable to NBCUniversal and General Electric from SVH	39,695		39,382

In 2008, we recorded an impairment charge that reduced the carrying value of our investment in SVH to $0. Subsequent to the reduction of the SVH carrying value to $0, and as a result of our guarantee of the GECC Note as further described in Note 13—"Commitments and Contingencies", we suspended recognition of equity method losses in our consolidated financial statements.

During the years ended December 31, 2012 and 2011, based on our estimate of our probable shortfall obligations to the joint venture, we recognized contingent liabilities of $4.2 million and $4.7 million, respectively, for the amounts that we expected to loan to SVH pursuant to the shortfall funding agreements with the GE Parties and NBCUniversal, as further described in Note 13—"Commitments and Contingencies." Because of uncertainty surrounding the joint venture's ability to repay shortfall loans, we concluded that it was more likely than not that the amounts recognized for accrued shortfall loans would not be recovered within a reasonable period of time, and concurrently recognized charges of $4.2 million and $4.7 million in 2012 and 2011, respectively, to reflect the impairment of the shortfall loans, which were classified within Share of loss in equity investments in our consolidated statement of operations. As a result of the JV Sale Transaction, as of February 12, 2013, we had no further shortfall funding obligations. Therefore, as of December 31, 2012, the remaining accrued shortfall funding liability of $6 million was also reversed and reflected in the Share of loss in equity investments line of our consolidated statement of operations.

_______________________________________________________________________________

⁽¹⁾ See Note 13—"Commitments and Contingencies" for further description of the GECC Note. Non-current liabilities includes shortfall loans outstanding and accrued interest payable to the joint venture partners.

⁽²⁾ Represents balances prior to the effect of the JV Sale Transaction.

Note 5—Property and Equipment

Property and equipment consisted of the following (in thousands):

	December 31,
	2013			2012
Land and land improvements	$	21,152		$	21,147
Buildings and fixtures	179,209			176,940
Broadcast equipment and other	319,912			311,907
Total property and equipment	520,273			509,994
Less accumulated depreciation	(299,195		)	(268,503		)
Property and equipment, net	$	221,078		$	241,491

We recorded depreciation expense of $46.9 million, $32.1 million and $26.2 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Note 6—Intangible Assets

The following table summarizes the carrying amount of each major class of intangible assets (in thousands):

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	Weighted-Average Remaining Useful Life (in years)	December 31,
		2013			2012
Finite-Lived Intangible Assets:
Network affiliations	1	$	32,996		$	32,996
Customer relationships	9	14,941			8,631
Non-compete agreements	1	1,588			1,588
Completed technology	3	10,191			6,370
Favorable leases	31	8,573			8,573
Retransmission consent agreements	4	7,860			7,859
Other intangible assets	19	9,817			9,609
Accumulated amortization		(38,917		)	(16,072		)
Net finite-lived intangible assets		$	47,049		$	59,554
Indefinite-Lived Intangible Assets:
Broadcast licenses		$	536,515		$	536,515
Summary:
Goodwill		$	203,528		$	192,514
Broadcast licenses and finite-lived intangible assets, net		583,564			596,069
Total intangible assets		$	787,092		$	788,583

We recorded amortization expense of $22.8 million, $6.4 million and $1.2 million for the years ended December 31, 2013, 2012 and 2011, respectively.

The following table summarizes the projected aggregate amortization expense for the next five years and thereafter (in thousands):

	Projected Aggregate Amortization Expense
For the years ended December 31,
2014	$	15,971
2015	5,783
2016	4,980
2017	3,266
2018	2,042
Thereafter	15,007
Total	$	47,049

There were no events during 2013, 2012 and 2011 to warrant the performance of an interim impairment test of our indefinite-lived intangible assets. We recorded a $1.6 million impairment charge related to discontinued operations for the year ended December 31, 2011.

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The changes in the carrying amount of goodwill for the years ended December 31, 2013 and 2012, respectively, are as follows (in thousands):

	Year Ended December 31,
	2013		2012
Broadcast:
Balance as of January 1, 2013 and 2012, respectively	$	185,237	$	114,882
Acquisitions	—		70,355
Balance as of December 31, 2013 and 2012, respectively	$	185,237	$	185,237
Digital:
Balance as of January 1, 2013 and 2012, respectively	$	7,277	$	7,187
Acquisitions/Adjustments	11,014		90
Balance as of December 31, 2013 and 2012, respectively	$	18,291	$	7,277
Total:
Balance as of January 1, 2013 and 2012, respectively	$	192,514	$	122,069
Acquisitions	11,014		70,445
Balance as of December 31, 2013 and 2012, respectively	$	203,528	$	192,514

Note 7—Debt

Debt consisted of the following (in thousands):

	December 31,
	2013		2012
Senior Secured Credit Facility:
Revolving credit loans	$	5,000	$	—
$118,750 and $125,000 Term loans, net of discount of $345 and $435 as of December 31, 2013 and December 31, 2012, respectively	118,405		124,565
$314,200 and $257,400 Incremental term loans, net of discount of $1,684 and $2,020 as of December 31, 2013 and December 31, 2012, respectively	312,516		255,380
83/8% Senior Notes due 2018	200,000		200,000
63/8% Senior Notes due 2021	290,000		290,000
Capital lease obligations	14,604		14,881
Other debt	6,167		5,401
Total debt	946,692		890,227
Less current portion	17,364		10,756
Total long-term debt	$	929,328	$	879,471

Senior Secured Credit Facility

Our senior secured credit facility is comprised of a six-year, $125 million tranche A term loan and a five-year, $75 million revolving credit facility, and bears interest at a rate based on, at our option, either a) the LIBOR interest rate, or b) the ABR rate, which is an interest rate that is equal to the greatest of (i) the Prime Rate, (ii) the Federal Funds Effective Rate plus 1/2 of 1 percent, and (iii) the one-month LIBOR rate plus 1%. In addition, the rate we select also bears an applicable margin based upon our Consolidated Senior Secured Leverage Ratio, currently set at 2.75% and 1.75% for LIBOR based loans and ABR rate loans, respectively. Following the issuance of this report during the first quarter of 2014, these rates will be 3% and 2% for LIBOR based

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loans and ABR rate loans, respectively. Lastly, the unused portion of the revolving credit facility is subject to a commitment fee based upon our Consolidated Senior Secured Leverage Ratio, currently set at 0.375% for both LIBOR based loans and ABR rate loans and will increase to 0.5% following the issuance of this report during the first quarter of 2014 for both LIBOR based loans and ABR rate loans.

Our senior secured credit facility also includes a seven-year, $260 million tranche B incremental term loan facility and a $60 million tranche B-2 incremental term facility that was funded on February 12, 2013 in connection with the JV Sale Transaction, each of which is subject to the terms of our Credit Agreement. Borrowings under the incremental term loan facility were used (i) to pay the call price for our redemption of all of our remaining 6¹/₂% Senior Subordinated Notes, as described below, and (ii) to pay accrued interest, fees and expenses associated with the redemption. Borrowings under the incremental term loan facility bear interest at a rate based, at our option, on an adjusted LIBOR rate, plus an applicable margin of 3%; or an adjusted Base Rate, plus an applicable margin of 2%; provided that the adjusted LIBOR rate and the adjusted Base Rate shall at no time be less than 1% and 2%, respectively.

On December 24, 2012, we entered into an amendment to our Credit Agreement (the "Credit Agreement"), dated as of October 26, 2011, as amended on December 19, 2011, by and among LIN Television, JPMorgan Chase Bank, N.A., as Administrative Agent, and the banks and other financial institutions party thereto, which (1) replaced our $257.4 million tranche B term loan maturing in December 2018 with a new tranche B term loan of the same maturity which bears interest at a reduced rate and (2) made certain other changes to the Credit Agreement, including changes to the financial covenants therein that are favorable to LIN Television and its affiliates and (3) extended the maturity for a $60 million tranche of our revolving credit facility to October 2017 and on May 9, 2013, we extended the maturity date of the remaining $15 million tranche of our revolving credit facility to October 2017. We paid customary fees and expenses in connection with the closing of these amendments of $1.7 million. As a result of these amendments, we recorded a loss on extinguishment of debt of $1.2 million associated with a write-down of deferred financing fees and unamortized discount to our consolidated statement of operations during the year ended December 31, 2012.

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

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

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

The Credit Agreement governing our senior secured credit facility also requires on an annual basis, following the delivery of our year-end financial statements, and commencing after the year ended December 31, 2012, mandatory prepayments of principal of the term loans based on a computation of excess cash flow for the preceding fiscal year, as more fully described in the Credit Agreement. However, based on the excess cash flow computation for the year ended December 31, 2013, we will not be required to make such prepayments during the year ending December 31, 2014.

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

The following table summarizes certain key terms including the LIBOR-based borrowing rates of our senior secured credit facility as of December 31, 2013 (in thousands):

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	Credit Facility
	Revolving Facility			Term Loans			Incremental Term Loans
Final maturity date	10/26/2017			10/26/2017			12/21/2018
Available balance as of December 31, 2013	$	70,000		$	—		$	—
Interest rates as of December 31, 2013:
Interest rate	0.17		%	0.17		%	1.00		%
Applicable margin	2.75		%	2.75		%	3.00		%
Total	2.92		%	2.92		%	4.00		%

2009 Senior Secured Credit Facility

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

8³/₈% Senior Notes

	83/8% Senior Notes
Final maturity date	4/15/2018
Annual interest rate	8.375%
Payable semi-annually in arrears	April 15th
	October 15th

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

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

6³/₈% Senior Notes

	63/8% Senior Notes
Final maturity date	1/15/2021
Annual interest rate	6.375%
Payable semi-annually in arrears	January 15th
	July 15th

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

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

The indenture governing our 6³/₈% Senior Notes contains covenants limiting our ability and the ability of our restricted subsidiaries to, among other things, incur certain additional indebtedness and issue preferred shares; make certain dividends, distributions, investments and other restricted payments; sell certain assets; agree to any restrictions on the ability of restricted

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subsidiaries to make payments to us; create certain liens; merge, consolidate or sell substantially all of our assets; and enter into certain transactions with affiliates. These covenants are subject to certain exceptions and qualifications. The indenture also has change of control provisions which may require our Company to purchase our 6³/₈% Senior Notes at a price equal to 101% of the principal amount thereof, together with accrued and unpaid interest. Additionally, if we sell assets under certain circumstances, we will be required to make an offer to purchase our 6³/₈% Senior Notes at their face amount, plus accrued and unpaid interest, if any, through the purchase date.

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

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

Capital Lease Obligations

As part of the transactions further described in Note 2—"Acquisitions," we assumed $15.1 million in capital lease obligations related to buildings and equipment. These leases mature over a period of 4 to 19 years and are payable in monthly installments. The total outstanding balance of these capital lease obligations was $14.6 million as of December 31, 2013. LIN Television fully and unconditionally guarantees these lease obligations.

Other Debt

During the year ended December 31, 2012, Vaughan, a consolidated VIE, entered into a term loan with an unrelated third party in an original principal amount of $4.6 million to fund a portion of the purchase price for the acquisition of certain assets of PBC. This term loan matures in equal quarterly installments through October 2017. We fully and unconditionally guarantee this loan.

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

During the year ended December 31, 2011, WBDT, a consolidated VIE, entered into a term loan with an unrelated third party in an original principal amount of $0.9 million to fund a portion of the purchase price for the acquisition of certain assets of WBDT-TV. This term loan matures in equal quarterly installments through May 2016. We fully and unconditionally guarantee this loan.

Repayment of Principal

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

	Revolving Facilities			Term Loans		Incremental Term Loans		83/8% Senior Notes		63/8% Senior Notes		Capital Leases		Other Debt		Total
Final maturity date	10/26/2017			10/26/2017		12/21/2018		4/15/2018		1/15/2021		Various		Various
2014	$	—		$	12,500	$	3,200	$	—	$	—	$	502	$	1,162	$	17,364
2015	—			18,750		3,200		—		—		528		1,162		23,640
2016	—			25,000		3,200		—		—		620		1,024		29,844
2017	5,000		(1)	62,500		3,200		—		—		577		819		72,096
2018	—			—		301,400		200,000		—		609		2,000		504,009
2019 and thereafter	—			—		—		—		290,000		11,768		—		301,768
Total	$	5,000		$	118,750	$	314,200	$	200,000	$	290,000	$	14,604	$	6,167	$	948,721

_______________________________________________________________________________

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⁽¹⁾  An additional $25 million was outstanding on our revolving credit facility as of the date of this report and is not reflected in our balance sheet as of December 31, 2013.

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

	December 31, 2013				December 31, 2012
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(in thousands)
Revolving credit loans	$	5,000	$	5,000	$	—	$	—
Term loans	430,921		432,105		379,945		380,599
Senior notes	490,000		512,983		490,000		524,500
Other debt	6,167		6,167		5,401		5,401
Total	$	932,088	$	956,255	$	875,346	$	910,500

Note 8—Derivative Financial Instruments

We have historically used derivative financial instruments in the management of our interest rate exposure for our long-term debt. In accordance with our interest rate risk management policy, we do not enter into derivative instruments unless there is an underlying exposure, and we do not enter into derivative financial instruments for speculative trading purposes.

During the second quarter of 2006, we entered into a contract to hedge a notional amount of the declining balances of our term loans under our prior senior secured credit facility (the "2006 interest rate hedge") to mitigate changes in our cash flows resulting from fluctuations in interest rates. The 2006 interest rate hedge was historically designated as a cash flow hedge, however, as a result of a repayment of $45.9 million of principal on our term loans under our 2009 senior secured credit facility during 2010, the 2006 interest rate hedge ceased to be highly effective in hedging the variable rate cash flows. As a result, all changes in fair value were recorded in our consolidated statement of operations, including a gain of approximately $2 million for the year ended December 31, 2011.

The 2006 interest rate hedge expired on November 4, 2011. Accordingly, there are no amounts related to the 2006 interest rate hedge included in our consolidated balance sheets as of December 31, 2013 and 2012.

As of December 31, 2013, we have no derivative contracts outstanding.

Note 9—Share-Based Compensation

We have several share-based compensation plans, including the 1998 Option Plan, the Amended and Restated 2002 Stock Plan and the Amended and Restated 2002 Non-Employee Director Stock Plan (collectively, the "Stock Plans"), that permit us to grant non-qualified options in LIN LLC's class A common shares or restricted share awards, to certain directors, officers and key employees of our Company.    

Options granted under the Stock Plans vest over a four-year service period, unless otherwise designated by the Compensation Committee upon grant. Options expire ten years from the date of grant. We issue new shares of LIN LLC's class A common shares when options are exercised or from shares that we repurchased pursuant to our Board authorized share repurchase program as further described in Note 11—"Shareholders' Equity." Restricted share awards vest over a service period designated by the Compensation Committee upon grant. There were 6,787,940 shares authorized for grant under the various Stock Plans and 2,375,605 shares available for future grant as of December 31, 2013. Both the shares authorized and shares available exclude 1,552,983 shares under plans in effect prior to 2002 from which we do not intend to re-grant and consider unavailable for future grants.

The following table presents the share-based compensation expense included in our consolidated statements of operations as follows (in thousands):

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	Year Ended December 31,
	2013		2012		2011
Employee share options	$	2,933	$	1,868	$	1,492
Restricted share awards	6,348		4,896		4,320
Modifications to share option agreements	93		93		364
Total share-based compensation	$	9,374	$	6,857	$	6,176

We did not capitalize any share-based compensation expense for the years ended December 31, 2013, 2012 and 2011.

We have not yet recognized compensation expense relating to unvested employee share options and restricted share awards of $2.6 million and $14 million, respectively, which will be recognized over a weighted-average future period of approximately 1.3 years and 1.7 years, respectively.

During the year ended December 31, 2013, we received $1.4 million from the exercise of share options and $0.4 million from the purchase of LIN TV's class A common stock pursuant to the employee stock purchase plan ("ESPP"), which terminated upon consummation of the Merger.

Share Options

The following table provides additional information regarding our share options for the year ended December 31, 2013 as follows (in thousands, except per share data):

	Shares		Weighted- Average Exercise Price Per Share
Outstanding at the beginning of the year	4,894		$	3.42
Granted during the year	110		12.29
Exercised or converted during the year	(420	)	3.23
Forfeited during the year	(163	)	5.43
Expired during the year	(9	)	3.57
Outstanding at the end of the year	4,412		3.58
Exercisable or convertible at the end of the year	3,304		2.79

As of December 31, 2013, the weighted-average remaining contractual life of the options outstanding and the options exercisable was 6.1 years and 5.3 years, respectively. Additionally, as of December 31, 2013, the aggregate intrinsic value of the options outstanding and the options exercisable was $110.7 million and $85.5 million, respectively. The intrinsic value in the table above represents the total pre-tax intrinsic value based on our closing price as of December 31, 2013, which would have been received by the option holders had all option holders exercised their options and immediately sold their shares on that date.

The fair value of each share option grant or modification is estimated on the date of grant or modification using a Black-Scholes valuation model, which incorporates the following assumptions:

	Year Ended December 31,
	2013	2012	2011
Expected term(1)	5 to 6 years	5 to 6 years	5 to 6 years
Expected volatility(2)	95% to 96%	98% to 99%	97% to 99%
Expected dividends	$—	$—	$—
Risk-free rate(3)	0.8% to 1.2%	0.6% to 1.1%	0.9% to 2.6%

_______________________________________________________________________________

⁽¹⁾  The expected term was estimated using our historical experience.

⁽²⁾  Expected volatility is based on historical trends for LIN LLC class A common shares over the expected term.

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⁽³⁾  The risk-free interest rate for each grant is equal to the U.S. Treasury yield curve in effect at the time of grant for instruments with a similar expected life.

During the years ended December 31, 2013, 2012 and 2011, we recognized share-based compensation expense for a modification to our share option agreements of $0.1 million, $0.1 million and $0.4 million, respectively, as a result of an exchange offer we completed in 2009.

Restricted Share Awards

The following table provides additional information regarding the restricted share awards for the year ended December 31, 2013 (in thousands, except per share data):

	Shares		Weighted- Average Price Per Share
Unvested at the beginning of the year	2,294		$	5.98
Granted during the year	582		18.89
Vested during the year	(960	)	6.00
Forfeited during the year	(205	)	5.87
Unvested at the end of the year	1,711		10.37

The following table provides further information for both our restricted share awards and share option awards (in thousands):

	Year Ended December 31,
	2013		2012		2011
Total fair value of options and awards granted	$	12,349	$	10,347	$	4,983
Total intrinsic value of options exercised	5,136		865		225
Total fair value of awards vested	18,050		7,718		7,522

Employee Stock Purchase Plan

As a result of the Merger, the ESPP was terminated, effective July 30, 2013. Prior to this, under the terms of our ESPP, our eligible employees could elect to have up to 10% of eligible compensation deducted from their pay to purchase shares of LIN TV's class A common stock. The purchase price of each share was 85% of the average of the high and low per share trading price of LIN TV's class A common stock on the NYSE on the last trading day of each month during the offering period. During the year ended December 31, 2013, 2012 and 2011, employees purchased 42,734, 173,244 and 187,350 shares, respectively, at a weighted-average price of $10.05, $3.55 and $3.38, respectively.

Note 10—Retirement Plans

401(k) Plan

We provide a defined contribution plan ("401(k) Plan") for eligible employees. Effective January 1, 2010, we began making a 3% non-elective contribution for all eligible employees, which vests 100% after two years of service. We contributed $4.8 million, $3.9 million and $3.6 million to the 401(k) Plan in the years ended December 31, 2013, 2012 and 2011, respectively.

Supplemental Income Deferral Plan

Effective July 1, 2010, we also made available to certain employees, including our executive officers, the LIN Television Corporation Supplemental Income Deferral Plan ("SIDP"). This plan provides benefits to highly compensated employees in circumstances in which the maximum limits established under the Employee Retirement Income Security Act of 1974 ("ERISA") and the Internal Revenue Code prevent them from receiving Company contributions. We contributed $0.5 million, $0.5 million and $0.2 million to this plan during the years ended December 31, 2013, 2012 and 2011, respectively.

The SIDP also allows eligible executive officers to defer 5% - 80% of their base salaries and 5% - 100% of their annual non-equity incentive awards on a tax-deferred basis and receive tax-deferred market-based growth. During 2013, the Company made contributions to the SIDP for each of the named executive officers in amounts equal to 5% of their base salary and non-equity incentive plan compensation.

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Retirement Plans

We have historically provided defined benefit retirement plans to our employees who did not receive matching contributions from our Company to their 401(k) Plan accounts. Our defined benefit plans were non-contributory plans under which we made contributions either to: a) traditional plan participants based on periodic actuarial valuations, which are expensed over the expected average remaining service lives of current employees through the LIN Television Corporation Retirement Plan ("Retirement Plan"); or b) cash balance plan participants based on 5% of each participant's eligible compensation through the Supplemental Benefit Retirement Plan of LIN Television Corporation ("SERP").

Effective April 1, 2009, these plans were frozen and we do not expect to make additional benefit accruals to these plans, however we continue to fund our existing vested obligations. We contributed $5.4 million, $7.4 million and $5.4 million to our pension plans during the years ended December 31, 2013, 2012 and 2011, respectively. We anticipate contributing $5.7 million to the plans in 2014.

We record the unfunded status of our defined benefit plans as a liability. For the years ended December 31, 2013 and December 31, 2012, each plan was underfunded. The plan assets and benefit obligations of our defined benefit plans are recorded at fair value. Information regarding the change in the projected benefit obligation, the accumulated benefit obligation and the change in the fair value of plan assets for our traditional defined benefit plan and our cash balance plan are as follows (in thousands):

	Year Ended December 31,
	2013			2012
Change in projected benefit obligation
Projected benefit obligation, beginning of period	$	134,969		$	133,047
Service cost	—			—
Interest cost	5,259			5,379
Actuarial (gain) loss	(10,282		)	1,485
Benefits paid	(4,943		)	(4,942		)
Curtailment	—			—
Projected benefit obligation, end of period	$	125,003		$	134,969
Accumulated benefit obligation	$	125,003		$	134,969
Change in plan assets
Fair value of plan assets, beginning of period	$	96,412		$	82,314
Actual return on plan assets	10,611			11,621
Employer contributions	5,359			7,419
Benefits paid	(4,943		)	(4,942		)
Fair value of plan assets, end of period	$	107,439		$	96,412
Unfunded status of the plan	$	(17,564	)	$	(38,557	)
Total amount recognized as accrued benefit liability	$	(17,564	)	$	(38,557	)

The following table includes the pension related accounts recognized on our consolidated balance sheets and the components of accumulated other comprehensive loss related to the net periodic pension benefit costs (in thousands):

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	December 31,
	2013			2012
Other accrued expenses (current)	$	(695	)	$	(373	)
Other liabilities (long-term)	(16,869		)	(38,184		)
Total amount recognized as accrued pension benefit liability	$	(17,564	)	$	(38,557	)
Accumulated other comprehensive loss:
Net loss	$	32,681		$	48,978
Tax benefit	12,915			19,354
Net loss, net of tax benefit	19,766			29,624
Pension tax liability	5,760			5,760
Accumulated other comprehensive loss related to net periodic pension benefit cost	$	25,526		$	35,384

The total net loss of $32.7 million for the year ending December 31, 2013 relates to deferred actuarial losses from changes in discount rates, differences between actual and assumed asset returns, and differences between actual and assumed demographic experience (rates of turnover, retirement rates, mortality rates and prior to the plan freeze, rates of compensation increases). During 2014, we expect to amortize net losses of $1.3 million, which are included in accumulated other comprehensive loss as of December 31, 2013.

The following table includes other changes in plan assets and benefit obligations that were recognized in other comprehensive income (loss) (in thousands):

	December 31,
	2013		2012		2011
Net gain (loss)	$	14,443	$	3,947	$	(18,503	)
Amortization of net actuarial loss	1,854		1,578		753
Net gain (loss)	$	16,297	$	5,525	$	(17,750	)
Tax benefit (provision)	6,439		2,132		(6,912		)
Total amount recognized in other comprehensive income (loss)	$	9,858	$	3,393	$	(10,838	)

Components of net periodic pension benefit cost were (in thousands):

	Year Ended December 31,
	2013			2012			2011
Service cost	$	—		$	—		$	—
Interest cost	5,259			5,379			5,872
Expected return on plan assets	(6,450		)	(6,190		)	(6,824		)
Amortization of prior service cost	—			—			—
Amortization of net loss	1,854			1,579			754
Net periodic benefit cost (gain)	$	663		$	768		$	(198	)

Our expected future pension benefit payments for the next 10 years are as follows (in thousands):

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For Years Ended December 31,	Expected Future Pension Benefit Payments
2014	$	7,914
2015	5,879
2016	5,955
2017	5,966
2018	6,281
2019 through 2023	38,156

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

	Year Ended December 31,
	2013		2012		2011
	SERP	Retirement Plan	SERP	Retirement Plan	SERP	Retirement Plan
Discount rate used to estimate our pension benefit obligation	4.70%	5.00%	3.60%	4.00%	3.90%	4.20%
Discount rate used to determine net periodic pension benefit	3.60%	4.00%	3.90%	4.20%	5.25%	5.25%
Rate of compensation increase	N/A	N/A	N/A	N/A	N/A	N/A
Expected long-term rate-of-return on plan assets	N/A	7.00%	N/A	7.00%	N/A	7.00%

For the discount rate for the years ended December 31, 2013 and 2012, we used a custom bond modeler that develops a hypothetical portfolio of high quality corporate bonds, rated AA- and above by Standard & Poor's, that could be purchased to settle the obligations of the plan. The yield on this hypothetical portfolio represents a reasonable rate to value our plan liability.

We considered the current levels of expected returns on a risk-free investment, the historical levels of risk premium associated with each of our pension asset classes, the expected future returns for each of our pension asset classes and then weighted each asset class based on our pension plan asset allocation to derive an expected long-term return on pension plan assets. During the years ended December 31, 2013, 2012 and 2011, our actual rate of return on plan assets was 12.0%, 15.4% and 4.0%.

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

	Target Allocation	Percentage of Plan Assets as of December 31,
Asset Category	2013	2013	2012
Equity securities	60%	60%	55%
Debt securities	40%	40%	45%
	100%	100%	100%

The following table summarizes our pension plan assets measured at fair value using the prescribed three-level fair value hierarchy as of December 31, 2013 and 2012 (in thousands):

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	Quoted Prices in Active Markets for Identical Assets		Significant Observable Inputs
	(Level 1)		(Level 2)		Total
December 31, 2013:
Cash and cash equivalents	$	690	$	—	$	690
Money market fund	—		762		762
Commingled pools:					—
U.S. equity	—		37,645		37,645
International equity	—		18,884		18,884
REIT	—		3,213		3,213
High yield bond	—		4,101		4,101
Emerging markets	—		5,994		5,994
Investment grade fixed income	—		36,150		36,150
Total	$	690	$	106,749	$	107,439
December 31, 2012:
Cash and cash equivalents	$	573	$	—	$	573
Money market fund	—		519		519
Commingled pools:					—
U.S. equity	—		30,034		30,034
International equity	—		15,241		15,241
REIT	—		3,875		3,875
High yield bond	—		2,916		2,916
Emerging markets	—		6,374		6,374
Investment grade fixed income	—		36,880		36,880
Total	$	573	$	95,839	$	96,412

The commingled pools, U.S. and International stock funds and U.S. bond funds consist of various funds that are valued at the net asset value of units held by the plan at year-end as determined by the custodian, based on fair value of the underlying securities. These methods may produce a fair value calculation that may not be indicative of net realizable value or reflective of future values. Furthermore, while we believe these valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine fair value of certain financial instruments could result in different fair value measurement as of the reporting date.

Note 11—Shareholders' Equity

During the year ended December 31, 2011, LIN TV's Board of Directors approved a stock repurchase program that authorized LIN TV to repurchase up to $25 million of LIN TV's class A common stock over a 12 month period. This program was extended by LIN TV's Board of Directors in November 2012 and was scheduled to expire on the earlier of the completion of all purchases contemplated by the plan or November 14, 2013; however, on February 12, 2013, as a result of entering into the Merger Agreement, LIN TV terminated the share repurchase program. Prior to the termination, during the year ended December 31, 2012, LIN TV repurchased approximately 3.3 million shares of LIN TV's class A common stock on the open market for an aggregate purchase price of $11.4 million. There were no shares repurchased during the year ended December 31, 2013.

LIN LLC's class B common shares are convertible into an equal number of shares of LIN LLC's class A or class C common shares in various circumstances. During the year ended December 31, 2013, prior to the Merger, 2.5 million shares of LIN TV's class B common stock were converted into shares of class A common stock. During the year ended December 31, 2012, none of LIN TV's class B common stock was converted into class A common stock.

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Note 12—Restructuring and Contract Termination Costs

During the year ended December 31, 2013, we recorded restructuring charges of $3.9 million primarily related to severance and related costs associated with the integration of the television stations acquired during 2012. During the years ended December 31, 2012 and 2011, we recorded restructuring charges of $1.0 million and $0.7 million, respectively, as a result of severance and related costs as well as the consolidation of certain activities at our stations and our corporate headquarters. During the years ended December 31, 2013, 2012 and 2011, we made cash payments of $4.2 million, $0.8 million and $1.1 million related to these restructuring actions. We expect to make cash payments of $0.4 million related to these restructuring actions during 2014.

The activity for these restructuring charges relating to severance and related costs is as follows (in thousands):

	Severance and Related
Balance as of December 31, 2011	$	515
Charges	1,009
Payments	(807		)
Balance as of December 31, 2012	$	717
Charges	3,895
Payments	(4,189		)
Balance as of December 31, 2013	$	423

In December 2013, we terminated an agreement with a service provider that provided national sales representation and made a payment of $5.4 million to exit our agreement prior to its expiration. Concurrent with the termination of the agreement, we released $1.5 million of deferred credits associated with the terminated contract. The amount of the one-time termination payment, offset by the release of the deferred credits, has been reflected as Contract termination costs in our consolidated statement of operations for 2013.

Note 13—Commitments and Contingencies

Commitments

We lease land, buildings, vehicles and equipment pursuant to non-cancelable operating lease agreements and we contract for general services pursuant to non-cancelable operating agreements that expire at various dates through 2036. In addition, we have entered into commitments for future syndicated entertainment and sports programming. Future payments for these non-cancelable operating leases and agreements, and future payments associated with syndicated television programs as of December 31, 2013 are as follows (in thousands):

	Operating Leases and Agreements		Syndicated Television Programming(1)		Total
Year
2014	$	45,076	$	27,119	$	72,195
2015	33,930		26,675		60,605
2016	16,140		17,387		33,527
2017	12,146		3,133		15,279
2018	1,611		153		1,764
Thereafter	7,139		214		7,353
Total obligations	$	116,042	$	74,681	$	190,723

⁽¹⁾Includes $6.3 million of program obligations recorded on our consolidated balance sheet as of December 31, 2013

Rent expense, resulting from operating leases, was $5.8 million, $2.5 million and $1.5 million for the years ended December 31, 2013, 2012 and 2011, respectively.

F-92

Contingencies

GECC Guarantee and the Merger

GECC provided secured debt financing for the joint venture between NBCUniversal and us, in the form of an $815.5 million non-amortizing senior secured note due 2023 bearing interest at an initial rate of 8% per annum until March 1, 2013 and 9% per annum thereafter. The GECC Note was an obligation of the joint venture. As of December 31, 2012, we had a 20.38% equity interest in the joint venture and NBCUniversal had the remaining 79.62% equity interest, in which we and NBCUniversal each had a 50% voting interest. NBCUniversal operated two television stations, KXAS-TV, an NBC affiliate in Dallas, and KNSD-TV, an NBC affiliate in San Diego, pursuant to a management agreement. LIN TV had previously guaranteed the payment of principal and interest on the GECC Note.

On February 12, 2013, we, along with our wholly-owned subsidiaries, LIN Television and LIN Texas, entered into, and simultaneously closed the JV Sale Transaction with subsidiaries of NBCUniversal, the GE Parties, Comcast and SVH whereby in exchange for LIN Television causing a $100 million capital contribution to be made to SVH (which was used to prepay a portion of the GECC Note), LIN TV was released from the GECC Guarantee and any further obligations relating to the shortfall funding agreements. Further, LIN Texas sold its 20.38% equity interest in SVH to affiliates of NBCUniversal, and the LIN parties transferred their rights to receivables related to the Shortfall Funding Loans for $1.00.

We accrued for and expensed the $100 million capital contribution to SVH to secure the release of the guarantee and recorded the related tax effects in our consolidated financial statements as of December 31, 2012, because it represented a probable and estimable obligation of the Company. In February 2013, we entered into a $60 million Incremental Facility and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million payment. As a result of the JV Sale Transaction, after utilizing all of our available Federal net operating loss (“NOL”) carryforwards, we had an approximate $162.8 million income tax payable remaining, $131.5 million of which was extinguished as a result of the Merger described below.

On July 30, 2013, LIN TV was merged with and into LIN LLC with LIN LLC continuing as the surviving entity. The Merger enabled the surviving entity to be classified as a partnership for federal income tax purposes and that change in classification was treated as a liquidation of LIN TV for federal income tax purposes with the result that LIN TV realized a capital loss in its 100% equity interest in LIN Television.

Based on an average of the opening and closing trading prices of LIN TV's class A common stock on the day of the Merger, LIN TV realized a capital loss of approximately $343 million, which represents the difference between its tax basis in the stock of LIN Television, and the fair market value of this stock as of July 30, 2013.  The capital loss realized and existing net operating losses were used to offset a portion of the capital gain recognized in the JV Sale Transaction and as a result, we realized tax savings of $131.5 million, resulting in a remaining tax liability of $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this tax liability during the fourth quarter of 2013.

As a result of the JV Sale Transaction, neither we nor any of our direct or indirect subsidiaries have any further investment in or obligations (funding or otherwise) related to SVH, including, without limitation, to make any other unsecured shortfall loans or payments under the GECC Note or the GECC Guarantee.

Litigation

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

F-93

Note 14—Income Taxes

Our income before income taxes is solely from domestic operations. The (benefit from) provision for income taxes consists of the following (in thousands):

	Year Ended December 31,
	2013			2012		2011
Current:
Federal	$	26,056		$	21	$	543
State	5,636			1,571		652
Foreign	—			633		—
Total current	$	31,692		$	2,225	$	1,195
Deferred:
Federal	$	(124,201	)	$	33,865	$	(25,907	)
State	(32,911		)	4,373		8,667
Total deferred	(157,112		)	38,238		(17,240		)
Total current and deferred	$	(125,420	)	$	40,463	$	(16,045	)

The following table reconciles the amount that would be calculated by applying the 35% federal statutory rate to income before income taxes to the actual (benefit from) provision for income taxes (in thousands):

	Year Ended December 31,
	2013			2012			2011
Provision assuming federal statutory rate	$	10,913		$	7,871		$	11,780
State taxes, net of federal tax benefit	3,863			5,723			1,790
State tax law/rate changes, net of federal tax benefit	—			1,883			5,703
Change in valuation allowance	(18,157		)	(4,622		)	(36,541		)
Share compensation	(53		)	(17		)	601
Reserve for tax contingencies	124			633			—
Impact of JV Sale Transaction	—			28,435			—
Impact of the Merger	(124,306		)	—			—
Non-deductible acquisition and Merger related transaction costs	1,645			—			—
Other	551			557			622
	$	(125,420	)	$	40,463		$	(16,045	)
Effective income tax rate on continuing operations	(402.2		)%	179.9		%	(47.7		)%

During the year ended December 31, 2013, we recognized a $124.3 million tax benefit as a result of the Merger as well as an $18.2 million tax benefit as a result of the reversal of state valuation allowances. These valuation allowances were reversed after evaluating our ability to recover certain net operating loss carryforwards due to the change in tax structure as a result of the Merger, as we concluded the Company will more likely than not be able to realize these deferred tax assets.

The impact of the JV Sale Transaction is a result of entering into and consummating the transactions contemplated by the JV Transaction Agreement on February 12, 2013, as described further in Note 1—"Basis of Presentation and Summary of Significant Accounting Policies" and in Note 13—"Commitments and Contingencies." The JV Sale Transaction resulted in the recognition of $27.5 million and $0.9 million of incremental short-term deferred federal and state tax liabilities, respectively, in excess of those which were previously established. The financial impact of the JV Sale Transaction and corresponding tax expense of $28.4 million are reflected in our consolidated financial statements for the year ended December 31, 2012. During the first quarter of 2013, approximately $162.8 million of short term deferred liabilities were reclassified to income taxes payable upon the consummation of the JV Sale Transaction. As a result of the close of the Merger on July 30, 2013, $131.5 million of this tax liability was extinguished, resulting in a remaining tax liability of approximately $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this tax liability during the fourth quarter of 2013.

F-94

The 2011 state tax law/rate change, net of federal tax benefit, of $5.7 million is primarily a result of state tax legislation enacted in Michigan in May 2011, which repealed the Michigan business tax ("MBT"), and implemented a corporate income tax instead, effective January 2012. As a result of the elimination of the MBT, certain future tax deductions that were available to be utilized beginning in 2015, and had been recognized as deferred tax assets in our financial statements, will not be deductible. Therefore, during the year ended December 31, 2011, we recognized incremental deferred income tax expense of $5.1 million, net of federal benefit, for the reversal of these previously established deferred tax assets. In addition, the 2012 state tax law/rate change, net of federal tax benefit, of $1.9 million is a result of a change in the effective tax rate used to value our deferred tax assets/liabilities.

The components of the net deferred tax liability are as follows (in thousands):

	December 31,
	2013			2012
Deferred tax liabilities:
Deferred gain related to equity investment in NBC joint venture	$	—		$	259,049
Property and equipment	11,816			12,822
Intangible assets	54,859			36,761
Deferred gain on debt repurchase	18,140			18,309
Noncontrolling interest	849			549
Other	7,629			7,476
Total	$	93,293		$	334,966
Deferred tax assets:
Net operating loss carryforwards	$	(17,707	)	$	(110,169	)
Equity investments	(2,372		)	(1,554		)
Other	(15,426		)	(32,625		)
Valuation allowance	—			18,157
Total	(35,505		)	(126,191		)
Net deferred tax liabilities	$	57,788		$	208,775

We maintain a valuation allowance related to our deferred tax asset position when management believes it is more likely than not that the deferred tax assets will not be realized in the future. As of December 31, 2012, we had a valuation allowance of $18.2 million offsetting certain state net operating loss carryforwards and other state deferred tax assets. During the third quarter of 2013, after evaluating our ability to recover certain net operating loss carryforwards due to the change in tax structure as a result of the Merger, we determined that we will more likely than not be able to realize these deferred tax assets. As a result, we reversed the valuation allowance and recognized a corresponding tax benefit of $18.2 million.

As of December 31, 2013, we had federal net operating loss carryforwards (tax effected) of approximately $4.6 million that begin to expire in 2034. Additionally, we had state net operating loss carryforwards that vary by jurisdiction (tax effected, net of federal benefit) of $13.1 million, expiring through 2033. Included in the total federal and state net operating loss carryforwards (tax effected) is $4.9 million that would be recorded in additional paid-in capital when realized.

Unrecognized Tax Benefits.

The Company's uncertain tax positions for the years ended December 31, 2013, 2012, and 2011 are limited to certain unrecognized state and foreign benefits totaling $24.5 million, $26.6 million and $26.4 million, respectively. As of December 31, 2013, 2012 and 2011, there are $0.9 million, $0.8 million and $0 million of unrecognized tax benefits, respectively, that if recognized would reduce the effective tax rate from continuing operations.

We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. During the years ended December 31, 2013, 2012 and 2011, we did not recognize or accrue any amounts related to interest and penalties.

F-95

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands):

	Year Ended December 31,
	2013			2012			2011
Balance at beginning of year	$	26,559		$	26,381		$	26,610
Additions for tax positions of current year	733			1,798			2,386
Additions for tax positions of prior years	—			—			—
Reductions for tax positions of prior years	(2,084		)	(1,133		)	(2,128		)
Reductions related to settlements with taxing authorities	—			—			—
Reductions related to expiration of the statute of limitations	(730		)	(487		)	(487		)
Balance at end of year	$	24,478		$	26,559		$	26,381

We file a consolidated federal income tax return and we file numerous other consolidated and separate income tax returns in U.S. state jurisdictions. Tax years 2009-2012 remain open to examination by major taxing jurisdictions.

Note 15—Accrued Expenses

Accrued expenses consisted of the following (in thousands):

	December 31,
	2013		2012
Accrued compensation	$	11,817	$	11,275
Accrued contract costs	3,394		4,163
Accrued interest	12,168		7,841
Accrued capital contribution to joint venture	—		100,000
Other accrued expenses	24,317		29,967
Total	$	51,696	$	153,246

Note 16—Subsequent Events

On February 3, 2014, LIN Digital Media LLC, a wholly owned subsidiary, completed its acquisition of Federated Media Publishing, Inc. ("Federated Media"). Federated Media is an industry-leading digital content and conversational marketing company. For further information on this acquisition, see Note 2 — “Acquisitions.”

Note 17—Supplemental Disclosure of Cash Flow Information

	Year Ended December 31,
	2013		2012		2011
	(in thousands)
Cash paid for interest expense	$	48,646	$	42,348	$	47,801
Cash paid for income taxes—continuing operations	$	32,937	$	1,103	$	559
Non-cash investing activities:
Accrual for estimated shortfall loans to SVH	$	—	$	—	$	4,697
Non-cash financing activities:
Capital leases assumed in acquisitions	$	179	$	14,896	$	—

F-96

Note 18—Valuation and Qualifying Accounts

	Balance at Beginning of Period		Charged (Released) to Operations			Deductions			Balance at End of Period
	(in thousands)
Allowance for doubtful accounts as of December 31,
2013	$	3,599	$	1,608		$	(2,019	)	$	3,188
2012	$	2,310	$	2,047		$	(758	)	$	3,599
2011	$	2,194	$	760		$	(644	)	$	2,310
Valuation allowance for state and federal deferred tax assets as of December 31,
2013	$	18,157	$	(18,157	)	$	—		$	—
2012	$	23,422	$	(5,265	)	$	—		$	18,157
2011	$	59,990	$	(36,568	)	$	—		$	23,422

F-97

Note 19—Segment Reporting

Effective January 1, 2014, we began operating under two segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites, and our Digital segment includes the operating results of our digital companies; LIN Digital, LIN Mobile, Nami Media, HYFN, Dedicated Media, and Federated Media (acquired in February 2014). Unallocated corporate expenses primarily include our costs to operate as a public company and to operate our corporate locations. All revenues are generated in the United States of America. All impacted sections of this filing have been updated to reflect this change in reportable segments.

We use earnings before interest, taxes, depreciation and amortization, excluding non-recurring charges, restructuring charges, share-based compensation, loss or gain on sales of assets, and cash paid for programming (“Adjusted EBITDA”) as the primary financial measure reported to the chief executive officer (the chief operating decision maker) for use in assessing our operating segments’ operating performance. We believe that this measure is useful to investors because it eliminates a significant level of non-cash depreciation and amortization expense and other non-recurring charges and as a result, allows investors to better understand our operating segments’ performance. All adjustments to Adjusted EBITDA presented below to arrive at consolidated pre-tax income (loss) except for depreciation and amortization and cash paid for programming relate primarily to corporate activities. Cash paid for programming pertains only to our Broadcast segment. As a result, we have disclosed depreciation and amortization by segment, as this is the only adjustment to operating income that the chief executive officer reviews on a segment basis. We have presented prior period information to reflect our current reportable segments.

	Year ended December 31,
	2013		2012		2011
			(in thousands)
Net revenues:
Broadcast	$	576,510	$	512,367	$	372,783
Digital	75,853		41,095		27,220
Total net revenues	$	652,363	$	553,462	$	400,003

The following table is a reconciliation of Adjusted EBITDA to consolidated income before (benefit from) provision for income taxes.

F-98

	Year ended December 31,
	2013			2012			2011
				(in thousands)
Segment Adjusted EBITDA:
Broadcast	$	205,843		$	241,831		$	141,081
Digital	4,020			1,970			292
Total segment Adjusted EBITDA	209,863			243,801			141,373
Unallocated corporate	(23,257		)	(24,268		)	(18,514		)
Less:
Depreciation	46,854			32,149			26,246
Amortization of intangible assets	22,826			6,364			1,199
Amortization of program rights	29,242			23,048			21,406
Share-based compensation	9,374			6,857			6,176
Non-recurring and acquisition-related charges (1)	10,842			3,207			2,171
Restructuring charge	3,895			1,009			707
Contract termination costs	3,887			—			—
Loss on sale of assets	710			96			472
Add:
Cash payments for programming	31,677			24,258			24,622
Operating income	90,653			171,061			89,104
Other expense:
Interest expense, net	56,627			46,683			50,706
Share of loss in equity investments	56			98,309			4,957
Gain on derivative instruments	—			—			(1,960		)
Loss on extinguishment of debt	—			3,341			1,694
Other expense, net	2,100			237			51
Total other expense, net	58,783			148,570			55,448
Consolidated income before (benefit from) provision for income taxes	$	31,870		$	22,491		$	33,656

^{____________________________________________} 

⁽¹⁾ Non-recurring charges for the year ended December 31, 2013 primarily consist of expenses related to the Merger. Charges for the years ended December 31, 2012 and 2011 relate solely to acquisitions.

	Year ended December 31,
	2013			2012			2011
				(in thousands)
Operating income (loss):
Broadcast	$	142,753		$	207,431		$	118,399
Digital	(365		)	(461		)	(815		)
Unallocated corporate	(51,735		)	(35,909		)	(28,480		)
Total operating income	$	90,653		$	171,061		$	89,104

F-99

	Year ended December 31,
	2013		2012		2011
			(in thousands)
Depreciation and amortization:
Broadcast	$	64,887	$	35,521	$	25,761
Digital	4,046		2,365		1,105
Unallocated corporate	747		627		579
Total depreciation and amortization	$	69,680	$	38,513	$	27,445

	Year ended December 31,
	2013		2012		2011
			(in thousands)
Capital expenditures:
Broadcast	$	22,957	$	23,342	$	18,616
Digital	4,416		2,884		722
Unallocated corporate	2,001		2,004		731
Total capital expenditures	$	29,374	$	28,230	$	20,069

	December 31,		December 31,
	2013		2012
	(in thousands)
Assets:
Broadcast	$	1,100,343	$	1,136,861
Digital	69,690		29,351
Unallocated corporate	46,917		75,202
Total assets	$	1,216,950	$	1,241,414

F-100 

Note 20—Condensed Consolidating Financial Statements

LIN Television, a 100% owned subsidiary of LIN LLC, is the primary obligor of our senior secured credit facility, our 8³/8% Senior Notes and our 6³/8% Senior Notes, which are further described in Note 7 — “ Debt”. LIN LLC fully and unconditionally guarantees all of LIN Television’s debt on a joint-and-several basis. Additionally, all of the consolidated 100% owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television’s senior secured credit facility, our 8³/8% Senior Notes and our 6³/8% Senior Notes on a joint-and-several basis, subject to customary release provisions. There are certain contractual restrictions on LIN Television’s ability to obtain funds in the form of dividends or loans from the non-guarantor subsidiaries.

The following condensed consolidating financial statements present the consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income and consolidated statements of cash flows of LIN Television, as the issuer, the guarantor subsidiaries, and the non-guarantor subsidiaries of LIN Television and the elimination entries necessary to consolidate or combine the issuer with the guarantor and non-guarantor subsidiaries. These statements are presented in accordance with the disclosure requirements under SEC Regulation S-X Rule 3-10.

F-101 

LIN Television Corporation

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Balance Sheet

As of December 31, 2013

(in thousands)

	LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	10,313	$	3	$	2,209	$	—		$	12,525
Accounts receivable, net		89,005		39,416		16,988		—			145,409
Deferred income tax assets		5,818		1,080		—		—			6,898
Other current assets		12,264		1,049		1,888		—			15,201
Total current assets		117,400		41,548		21,085		—			180,033
Property and equipment, net		180,480		35,752		4,846		—			221,078
Deferred financing costs		16,357		—		91		—			16,448
Goodwill		169,492		18,518		15,518		—			203,528
Broadcast licenses, net		—		493,814		42,701		—			536,515
Other intangible assets, net		31,303		1,840		13,906		—			47,049
Advances to consolidated subsidiaries		7,664		968,728		—		(976,392	)		—
Investment in consolidated subsidiaries		1,534,600		—		—		(1,534,600	)		—
Other assets		52,778		2,688		1,276		(44,443	)		12,299
Total assets	$	2,110,074	$	1,562,888	$	99,423	$	(2,555,435	)	$	1,216,950
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	16,112	$	—	$	1,252	$	—		$	17,364
Accounts payable		4,185		5,339		4,478		—			14,002
Income taxes payable		749		671		—		—			1,420
Accrued expenses		42,570		6,254		2,872		—			51,696
Program obligations		4,711		1,013		1,303		—			7,027
Total current liabilities		68,327		13,277		9,905		—			91,509
Long-term debt, excluding current portion		926,223		—		3,105		—			929,328
Deferred income tax liabilities		30,013		33,824		849		—			64,686
Program obligations		2,505		217		1,424		—			4,146
Intercompany liabilities		968,628		—		7,764		(976,392	)		—
Other liabilities		27,151		58		44,443		(44,443	)		27,209
Total liabilities		2,022,847		47,376		67,490		(1,020,835	)		1,116,878
Redeemable noncontrolling interest		—		—		12,845		—			12,845
Total shareholders' equity (deficit)		87,227		1,515,512		19,088		(1,534,600	)		87,227
Total liabilities, redeemable noncontrolling interest and shareholders' equity (deficit)	$	2,110,074	$	1,562,888	$	99,423	$	(2,555,435	)	$	1,216,950

F-102 

LIN Television Corporation

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2013

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
Net revenues	$	428,806		$	181,678		$	55,850		$	(13,971	)	$	652,363
Operating expenses:
Direct operating		145,176			76,275			37,295			(7,668	)		251,078
Selling, general and administrative		109,679			40,934			12,516			(579	)		162,550
Amortization of program rights		21,452			5,690			2,100			—			29,242
Corporate		40,668			—			—			—			40,668
Depreciation		38,306			7,256			1,292			—			46,854
Amortization of intangible assets		17,594			935			4,297			—			22,826
Restructuring		3,633			—			262			—			3,895
Contract termination costs		3,887			—			—			—			3,887
Loss from asset dispositions		705			5			—			—			710
Operating (loss) income		47,706			50,583			(1,912	)		(5,724	)		90,653
Other (income) expense:
Interest expense, net		56,406			—			221			—			56,627
Share of loss in equity investments		56			—			—			—			56
Intercompany (income) expense		27,927			(28,243	)		316			—			—
Other, net		2,097			—			3			—			2,100
Total other (income) expense, net		86,486			(28,243	)		540			—			58,783
(Loss) income from continuing operations before taxes and equity in (loss) income from operations of consolidated subsidiaries		(38,780	)		78,826			(2,452	)		(5,724	)		31,870
(Benefit from) provision for income taxes		(155,975	)		31,530			(975	)		—			(125,420	)
Net (loss) income from continuing operations		117,195			47,296			(1,477	)		(5,724	)		157,290
Equity in income (loss) from operations of consolidated subsidiaries		41,607			—			—			(41,607	)		—
Net income (loss)		158,802			47,296			(1,477	)		(47,331	)		157,290
Net loss attributable to noncontrolling interests		—			—			(1,512	)		—			(1,512	)
Net income (loss) attributable to LIN Television Corporation	$	158,802		$	47,296		$	35		$	(47,331	)	$	158,802

F-103 

LIN Television Corporation

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Comprehensive Income

For the Year Ended December 31, 2013

(in thousands)

	LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
Net income (loss)	$	158,802	$	47,296	$	(1,477	)	$	(47,331	)	$	157,290
Pension net gain, net of tax of $5,705		8,738		—		—			—			8,738
Amortization of pension net losses, net of tax of $734		1,120		—		—			—			1,120
Comprehensive income (loss)		168,660		47,296		(1,477	)		(47,331	)		167,148
Comprehensive loss attributable to noncontrolling interest		—		—		(1,512	)		—			(1,512	)
Comprehensive income (loss) attributable to LIN Television Corporation	$	168,660	$	47,296	$	35		$	(47,331	)	$	168,660

F-104 

LIN Television Corporation

Notes to Consolidated Financial Statements (Continued)

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2013

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities, continuing operations	$	(1,986	)	$	50,612		$	930		$	—		$	49,556
INVESTING ACTIVITIES:
Capital expenditures		(22,768	)		(3,540	)		(3,066	)		—			(29,374	)
Payments for business combinations, net of cash acquired		(10,082	)		—			—			—			(10,082	)
Proceeds from the sale of assets		66			20			—			—			86
Capital contribution to joint venture with NBCUniversal		—			(100,000	)		—			—			(100,000	)
Receipt of dividend		78,011			—			—			(78,011	)		—
Advances on intercompany borrowings		(4,550	)		—			—			4,550			—
Payments from intercompany borrowings		15,009			145,358			—			(160,367	)		—
Net cash (used in) provided by investing activities, continuing operations		55,686			41,838			(3,066	)		(233,828	)		(139,370	)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director stock-based compensation		1,256			—			—			—			1,256
Tax benefit from exercises of share options		1,591			—			—			—			1,591
Proceeds from borrowings on long-term debt		141,000			—			—			—			141,000
Principal payments on long-term debt		(83,846	)		—			(1,314	)		—			(85,160	)
Payment of long-term debt issue costs		(655	)		—			—			—			(655	)
Payment of dividend		(2,000	)		(78,011	)		—			78,011			(2,000	)
Proceeds from intercompany borrowings		—			—			4,550			(4,550	)		—
Payments on intercompany borrowings		(145,358	)		(15,009	)		—			160,367			—
Net cash provided by (used in) financing activities		(88,012	)		(93,020	)		3,236			233,828			56,032
Net (decrease) increase in cash and cash equivalents		(34,312	)		(570	)		1,100			—			(33,782	)
Cash and cash equivalents at the beginning of the period		44,625			573			1,109			—			46,307
Cash and cash equivalents at the end of the period	$	10,313		$	3		$	2,209		$	—		$	12,525

F-105

EX-99.3

Exhibit 99.3

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

On September 8, 2015, Media General, Inc. and Meredith Corporation announced a definitive merger agreement under which Media General will acquire all the outstanding common stock of Meredith in a cash and stock transaction (the "Meredith Merger"). Consummation of the Meredith Merger is subject to customary closing conditions including, among other things, Federal Communication Commission approval and shareholder approval from both Media General and Meredith shareholders. On December 19, 2014, Media General and LIN Media LLC ("LIN") were combined in a business combination transaction (the "LIN Merger").  Also on that date, in connection with the LIN Merger, Media General and LIN swapped or otherwise divested certain stations.

The unaudited pro forma condensed combined financial information for the year ended December 31, 2014 and for the six months ended and as of June 30, 2015 has been derived from the historical consolidated financial statements of Media General for the year ended December 31, 2014 and for the six months ended and as of June 30, 2015, the historical consolidated financial statements of LIN Media for the period January 1, 2014 to December 18, 2014, and the historical consolidated financial statements of Meredith Corporation for the calendar year ended December 31, 2014 and for the six months ended and as of June 30, 2015, along with certain adjustments.

Meredith's fiscal year ends on June 30. Therefore the Meredith unaudited historical consolidated financial statement of operations for the calendar year end December 31, 2014 is derived by combining the first six months of Meredith’s fiscal year 2015 and the last six months of Meredith’s fiscal year 2014. Meredith’s unaudited historical consolidated financial statement of operations for the six months ended June 30, 2015, is derived by subtracting the financial data from Meredith’s historical condensed consolidated financial statement of operations for the six months ended December 31, 2014 from the financial data from Meredith’s consolidated statement of earnings for the fiscal year ended June 30, 2015. 

The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2014, have been prepared as though the LIN Merger and the Meredith Merger occurred as of January 1, 2014. The unaudited pro forma condensed combined statements of operations for the six months ended June 30, 2015 have been prepared as though the Meredith Merger occurred as of January 1, 2014, and the unaudited pro forma condensed combined balance sheet information at June 30, 2015 has been prepared as if the Meredith Merger occurred as of June 30, 2015.

The pro forma adjustments give effect to events that are (1) directly attributable to the mergers, (2) factually supportable and (3) with respect to the statements of operations, expected to have a continuing impact on the combined company’s results. The pro forma adjustments are based on available information and assumptions that Media General’s and Meredith's managements believe are reasonable. Such adjustments are estimates and are subject to change.

The unaudited pro forma condensed combined financial statements are provided for informational purposes only and do not purport to represent what the actual combined results of operations or the combined financial position of the combined company would have been had the LIN Merger and the Meredith Merger occurred on the dates assumed, nor are they necessarily indicative of future combined results of operations or combined financial position. The unaudited pro forma condensed combined financial statements do not reflect any cost savings or other synergies that the managements of Media General and Meredith believe could have been achieved had the LIN Merger and the Meredith Merger been completed on the dates assumed.

The Meredith Merger will be accounted for using the acquisition method of accounting in accordance with ASC 805. Media General’s and Meredith’s managements have evaluated the guidance contained in ASC 805 with respect to the identification of the acquirer in the Meredith Merger and concluded, based on a consideration of the pertinent facts and circumstances, that Media General will acquire Meredith for financial accounting purposes. Accordingly, Media General’s cost to acquire Meredith has been allocated to the acquired assets, liabilities and commitments based upon their estimated fair values. The allocation of the purchase price is preliminary and is dependent upon certain valuations that have not progressed to a stage where there is sufficient information to make a final allocation. In addition, the final purchase price of Media General’s acquisition of Meredith will not be known until the date of closing of the Meredith Merger and could vary materially from the preliminary purchase price. Accordingly, the final acquisition accounting adjustments may be materially different from the preliminary unaudited pro forma adjustments presented.

The actual amounts recorded as of the completion of the Meredith Merger may differ materially from the information presented in the unaudited pro forma condensed combined financial statements as a result of several factors, including the following:

● changes in Meredith’s net assets between the pro forma balance sheet as of June 30, 2015 and the closing of the Meredith Merger, which could impact the preliminary estimated purchase price or the preliminary estimated fair value as of the effective date of the Meredith Merger;

● changes in the price of Media General’s common stock;

● the value of the combined company at the effective date of the Meredith Merger; and

● other changes in net assets that may have occurred prior to the completion of the Meredith Merger, which could cause material differences in the information presented.

The unaudited pro forma condensed combined financial statements should be read in conjunction with the accompanying notes and in conjunction with the consolidated financial statements and related notes of both Media General and Meredith filed with the Securities and Exchange Commission. The unaudited pro forma condensed combined financial statements constitute forward-looking information and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated. See “Risk Factors” and “Cautionary Note Regarding Forward Looking Statements,” which are included elsewhere and incorporated by reference in this prospectus.

Meredith Media General

Pro Forma Condensed Combined Balance Sheet

As of June 30, 2015

(Unaudited, in thousands)

	Media General Historical			Meredith Historical			Pro Forma Adjustments				Pro Forma Combined Company
ASSETS
Current assets:
Cash and cash equivalents	$	72,078		$	22,833		$	(34,666	)	(a)	$	60,245
Trade accounts receivable, net		246,295			284,646			-				530,941
Inventories		-			24,681			-				24,681
Current portion of subscription acquisition costs		-			122,350			(122,350	)	(b)		-
Current portion of broadcast rights		-			4,516			(4,516	)	(c)		-
Current deferred tax asset		51,732			-			(28,387	)	(c)		23,345
Prepaid expenses and other current assets		36,739			23,505			4,516		(c)		64,760
Total current assets		406,844			482,531			(185,403	)			703,972
Property and equipment, net		483,581			213,736			31,662		(b)		728,979
Subscription acquisition rights		-			103,842			(103,842	)	(b)		-
Broadcast rights		-			1,795			(1,795	)	(c)		-
Other assets, net		71,290			67,750			59,438		(a),(c),(f)		198,478
Definite lived intangible assets, net		912,487			147,782			718,018		(b)		1,778,287
Broadcast licenses		1,097,100			624,684			31,316		(b)		1,753,100
Trade names		-			199,916			74,684		(b)		274,600
Goodwill		1,597,486			1,001,246			1,251,684		(b)		3,850,416
Total assets	$	4,568,788		$	2,843,282		$	1,875,762			$	9,287,832
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade accounts payable	$	33,293		$	93,944		$	54,900		(f)	$	182,137
Accrued salaries and wages		24,822			71,233			-				96,055
Other accrued expenses and other current liabilities		108,940			92,422			(29,137	)	(a),(c)		172,225
Current portion of unearned subscription revenues		-			206,126			-				206,126
Current portion of long-term broadcast rights payable		-			4,776			(4,776	)	(c)		-
Current installments of long-term debt		3,404			62,500			(43,950	)	(a)		21,954
Current installments of obligation under capital leases		856			-			-				856
Total current liabilities		171,315			531,001			(22,963	)			679,353
Long-term debt		2,272,695			732,500			1,757,608		(a)		4,762,803
Obligations under capital leases, excluding current installments		14,436			-			-				14,436
Deferred income tax liabilities		359,229			311,645			136,939		(a),(b),(e),(g)		807,813
Retirement and postretirement plans		202,994			-			37,840		(c)		240,834
Unearned subscription rights		-			151,221			-				151,221
Long-term broadcast rights payable		-			2,998			(2,998	)	(c)		-
Other liabilities		35,005			162,067			(34,842	)	(c)		162,230
Total liabilities		3,055,674			1,891,432			1,871,584				6,818,690
Noncontrolling interests		31,065			-			-				31,065
Stockholders' equity:
Common stock		1,311,141			37,657			1,036,404		(d)		2,385,202
Class B stock		-			6,963			(6,963	)	(d)		-
Additional paid in capital		-			49,019			(49,019	)	(d)		-
Accumulated other comprehensive income (loss)		(36,445	)		(12,648	)		12,648		(a),(e)		(36,445	)
Retained earnings		207,353			870,859			(988,892	)	(a),(d),(f)		89,320
Total stockholders' equity		1,482,049			951,850			4,178				2,438,077
Total liabilities, noncontrolling interests and stockholders' equity	$	4,568,788		$	2,843,282		$	1,875,762			$	9,287,832

(a) Reflects (1) the issuance of debt financing and the expenditure of cash necessary to acquire Meredith, (2) the repayment of Meredith’s existing debt and settlement of its interest rate swaps and (3) the repayment of Media General’s 6-3⁄8% senior notes due 2021 (“Media General’s 2021 Notes”). If the Meredith Merger had occurred as of June 30, 2015, the carrying amount of Media General’s long-term debt would have been as follows on a pro forma basis:

	(In thousands)
Media General Credit Agreement	$	1,566,000
5.875% Senior Notes due 2022		400,000
Other borrowings, less unamortized discounts		18,757
Unsecured financing		945,000
Incremental Term B Loan		1,855,000
		4,784,757
Less: current installments of long-term debt		21,954
Long-term debt	$	4,762,803

Meredith Media General

Pro Forma Condensed Combined Balance Sheet

As of June 30, 2015

(Unaudited, in thousands)

(b) Reflects an adjustment to (1) eliminate capitalized subscription acquisition costs, (2) record identifiable tangible and intangible assets of Meredith at their preliminary estimated fair value, and (3) record goodwill for the excess of cost over fair value of net identifiable assets of Meredith. The allocation of purchase price is subject to change as the appraisals are completed and more facts become known.

(c) Reflects reclassifications to the historical presentation of the Meredith balance sheet to conform to the presentation used in the Media General balance sheet. The adjustments reclassify current and long-term broadcast rights and broadcast rights payable, retirement and postretirement plan liabilities, and deferred income taxes, and certain other assets and liabilities.

(d) Eliminates Meredith’s stockholders’ equity and records an estimate of the fair value of the number of shares of common stock expected to be issued to acquire Meredith (68,882,360) at an estimated stock price of $14.00 per share as of October 23, 2015 and an estimate of the fair value of stock options expected to be issued to certain Meredith employees to replace outstanding Meredith stock options.

(e) Eliminate accumulated other comprehensive income and associated deferred income taxes related to Meredith's pension and postretirement plan liabilities and rate swaps.

(f) Reflects the impact of merger-related expenses on the balance sheet. As of June 30, 2015, merger-related expenses are expected to total approximately $235.0 million including $60.7 million of deferred financing costs on the new debt issued and $54.9 million of accrued Meredith merger-related expenses.

(g) Reflects the increase in deferred income tax liabilities for the difference between the book and tax basis of assets acquired as a result of purchase accounting.

Meredith Media General

Pro Forma Condensed Combined Balance Sheet

As of June 30, 2015

(Unaudited, in thousands)

For purposes of these Pro Forma Condensed Combined Financial Statements the estimated purchase price of Meredith was allocated based on preliminary estimated fair value as follows (in thousands):

Estimated purchase price	$	3,434,240
Working capital deficit acquired		133,694
Property and equipment		(245,398	)
Definite-lived intangible assets		(865,800	)
FCC licenses (indefinite lived)		(656,000	)
Trade name (indefinite lived)		(274,600	)
Other assets acquired		(66,463	)
Pension and post-retirement liabilities assumed		37,839
Long term unearned subscription revenues		151,221
Other liabilities assumed		127,226
Deferred income tax liability recorded in conjunction with acquisition		476,971
Excess of cost over fair value of net identifiable assets of acquired businesses	$	2,252,930

The amount allocated to definite-lived intangible assets represents the estimated fair values of network affiliations of $316.7 million, advertiser relationships of $212.9 million, customer relationships of $275.2 million, subscriber relationships of $45.5 million, and management contracts of $15.5 million. These intangible assets are expected to be amortized over the estimated remaining useful lives of 15 years for network affiliations, six to seven years for advertiser relationships, seven to ten years for customer relationships, six years for subscriber relationships, five years management contracts.

The equity component of the purchase price could be materially higher or lower depending on several factors including the share price of Media General voting common stock at the time the Meredith Merger closes. Media General and Meredith estimate that a 10% change in the share price would raise or lower the purchase price and goodwill by approximately $113 million.

Meredith Media General

Pro Forma Condensed Combined Statements of Operations

For the Twelve Months Ended December 31, 2014

	Media General												LIN Media												Media General - LIN Merger							Meredith			Meredith - Media General
	Media General Historical			Media General Station Divestitures			Station Acquisitions			Pro Forma Media General			LIN Media Historical 1.1.14 - 12.18.14			LIN Media Station Divestitures			Other (1)			Pro Forma LIN Media			Combined Company Pro Forma Adjustments				Pro Forma Combined Company			Meredith Historical			Combined Company Pro Forma Adjustments				Pro Forma Combined Company
Net operating revenue	$	674,963		$	(53,011	)	$	44,750		$	666,702		$	745,380		$	(68,173	)	$	1,367		$	678,574		$	-			$	1,345,276		$	-		$	(1,345,276	)	(h)	$	-
Net operating advertising revenue		-			-			-			-			-			-			-			-			-				-			845,766			915,140		(h)		1,760,906
Circulation		-			-			-			-			-			-			-			-			-				-			309,100			-				309,100
All other		-			-			-			-			-			-			-			-			-				-			373,431			430,136		(h)		803,567
Total net operating revenue	$	674,963		$	(53,011	)	$	44,750		$	666,702		$	745,380		$	(68,173	)	$	1,367		$	678,574		$	-			$	1,345,276		$	1,528,297		$	-			$	2,873,573
Operating costs:
Operating expenses, excluding depreciation expense		221,914			(19,479	)		12,369			214,804			287,996			(24,939	)		2,148			265,205			-				480,009			576,201			(38,700	)	(i)		1,017,510
Selling, general and administrative expenses		171,484			(14,754	)		9,328			166,058			178,571			(15,789	)		227			163,009			1,351		(a)		330,418			674,956			(30,570	)	(h),(i), (j)		974,804
Amortization of program license rights		21,630			(799	)		3,088			23,919			26,628			(3,655	)		-			22,973			-				46,892			-			14,693		(i)		61,585
Corporate and other expenses		33,007						-			33,007			109,855			-			(639	)		109,216			(25,646	)	(b)		116,577			-			41,362		(h),(i)		157,939
Depreciation and amortization		66,557			(1,956	)		4,439			69,040			60,847			(5,942	)		242			55,147			34,232		(c)		158,419			63,620			71,726		(i),(k)		293,765
(Gain) Loss related to property and equipment, net		(8,935	)		(43	)		-			(8,978	)		399			(21	)		-			378			-				(8,600	)		-			-				(8,600	)
Impairment of intangible assets and goodwill		-			-			-			-			60,867			-			-			60,867			-				60,867			-			10,322		(i)		71,189
Restructuring		-			-			-			-			2,536			-			-			2,536			-				2,536			-			12,166		(i)		14,702
Merger-related expenses		54,202			-			-			54,202			-			-		\-				-			(45,241	)	(b)		8,961			-			-				8,961
Total operating costs		559,859			(37,031	)		29,224			552,052			727,699			(50,346	)		1,978			679,331			(35,304	)			1,196,079			1,314,777			80,999				2,591,855
Operating income (loss)		115,104			(15,980	)		15,526			114,650			17,681			(17,827	)		(611	)		(757	)		35,304				149,197			213,520			(80,999	)			281,718
Other income (expense):
Interest expense		(45,704	)		-			-			(45,704	)		(54,330	)		23			(53	)		(54,360	)		(23,073	)	(d)		(123,137	)		(15,935	)		(109,810	)	(l)		(248,882	)
Debt modification and extinguishment costs		(3,513	)		-			-			(3,513	)		-			-			-			-			-				(3,513	)		-			-				(3,513	)
Gain on sale of stations		42,957			-			-			42,957			-			-			-			-			(42,957	)	(e)		-			-			-				-
Other, net		129			-			-			129			(156	)		-			1			(155	)		-				(26	)		-			-				(26	)
Total other income (expense)		(6,131	)		-			-			(6,131	)		(54,486	)		23			(52	)		(54,515	)		(66,030	)			(126,676	)		(15,935	)		(109,810	)			(252,421	)
Income (loss) before income taxes		108,973			(15,980	)		15,526			108,519			(36,805	)		(17,804	)		(663	)		(55,272	)		(30,726	)			22,521			197,585			(190,809	)	(m)		29,297
Income tax (expense) benefit		(52,453	)		6,391			(6,210	)		(52,272	)		4,383			10,625			(461	)		14,547			12,291		(f)		(25,434	)		(69,698	)		76,324				(18,808	)
Net income (loss)		56,520			(9,589	)		9,316			56,247			(32,422	)		(7,179	)		(1,124	)		(40,725	)		(18,435	)			(2,913	)		127,887			(114,485	)			10,489
Net income (loss) attributable to noncontrolling interests (included above)		3,014			-						3,014			(129	)		1,376			-			1,247			1,605		(g)		5,866			-			-				5,866
Net income (loss) attributable to Company	$	53,506		$	(9,589	)	$	9,316		$	53,233		$	(32,293	)	$	(8,555	)	$	(1,124	)	$	(41,972	)	$	(20,040	)		$	(8,779	)	$	127,887		$	(114,485	)		$	4,623
Income (loss) per common share (basic)	$	0.59								$	0.59											$	(0.78	)					$	(0.07	)								$	0.02
Weighted average common shares (basic)		89,912									89,912												53,962							129,796						68,882		(n)		198,678
Income (loss) per common share (assuming dilution)	$	0.58								$	0.58											$	(0.78	)					$	(0.07	)								$	0.02
Weighted average common shares (assuming dilution)		91,052									91,052												53,962							130,936						73,977		(n)		204,913

(1)	Reflects seven weeks of data for Federated Media and its adjustments for LIN's purchase thereof.
(a)	Adjust stock compensation expense for incremental amounts related to equity awards issued to LIN employees as part of the aquisition.

(b) Reflects the elimination of LIN and Media General expenses of $25.6 million and $45.2 million, respectively, related to the LIN Merger incurred during the year ended December 31, 2014.

(c) Reflects the increase in depreciation and amortization expense resulting from the purchase price allocation for tangible and intangible assets to estimated fair value of LIN. Depreciation and amortization is based on estimated remaining useful lives. For the LIN Merger the intangible assets are expected to be amortized over 15 years for network affiliations, seven years for advertiser relationships, eight years for customer relationships, three years for completed technology, 31 years for favorable lease assets and six years for other intangible assets.

(d) Adjust interest expense for the debt used to finance the LIN Merger as if the debt was outstanding for the entire period.

(e) Reflects the elimination of the $43 million gain recorded on the Media General station divestitures.

(f) Reflects the tax effect of pro forma adjustments using the statutory rate of approximately 40% in effect for the period presented.

(g) Reflects the separate presentation of net income attributable to LIN's variable interest entities to be consistent with Media General's accounting policies.

(h) Reflects the reclassification of revenues and expenses of Media General to be consistent with revenue and expenses classification presented.

(i) Reflects the reclassification of certain operating costs of Meredith to be consistent with Media General's presentation.

(j) Reflects the adjustment of Meredith pension expense to remove impact of previous actuarial gains and losses.

(k) Reflects the increase in the depreciation and amortization expense resulting from the purchase price allocation of tangible and intangible assets to estimated fair value of Meredith. Depreciation and amortization is based on the estimated remaining useful lives.

(l) Reflects adjustments to interest expense for the repayment of the outstanding Meredith debt, the repayment of Media General's 2021 Notes and the new debt issued by Media General to finance the Meredith Merger, based on an assumed weighted blended interest rate of 5.1%. The new debt to be issued by Media General is anticipated to be comprised of $945.0 million of unsecured financing and $1.855 billion of secured term loans. A 0.125% change in the assumed interest rate (on a blended basis) would increase or decrease annualized cash interest expenses by approximately $3.5 million.

(m) Reflects the tax effect of pro forma adjustments using the statutory rate of approximately 40% in effect for the period presented.

(n) Assumes that the approximately 68.9 million shares of voting common stock estimated to be issued to acquire Meredith were outstanding for the entire period. Diluted common shares include an estimate of the dilutive effect of equity instruments including those expected to be issued to certain Meredith employees to replace outstanding Meredith stock options.

Meredith Media General

Pro Forma Condensed Combined Statements of Operations

For the Six Months Ended June 30, 2015

(Unaudited, in thousands except per share amounts)

	Media General			Meredith			Meredith - Media General Merger
	Media General Historical			Meredith Historical			Combined Company Pro Forma Adjustments				Pro Forma Combined Company
Net operating revenue	$	617,257		$	-		$	(617,257	)	(a)	$	-
Net operating advertising revenue		-			437,095			397,818		(a)		834,913
Circulation		-			188,332			-				188,332
All other		-			198,660			219,439		(a)		418,099
Total net operating revenue	$	617,257		$	824,087		$	-			$	1,441,344
Operating costs:
Operating expenses, excluding depreciation expense		260,045			316,771			(21,216	)	(b)		555,600
Selling, general and administrative expenses		159,521			356,191			(6,658	)	(b)		509,054
Amortization of program license rights		23,805			-			9,131		(b)		32,936
Corporate and other expenses		25,017			-			18,743		(b)		43,760
Depreciation and amortization		82,901			30,727			37,580		(c)		151,208
Gain related to property and equipment, net		(424	)		-			-				(424	)
Merger-related expenses		8,893			-			-				8,893
Total operating costs		559,758			703,689			37,580				1,301,027
Operating income		57,499			120,398			(37,580	)			140,317
Other income (expense):								-
Interest expense		(60,311	)		(10,325	)		(52,044	)	(d)		(122,680	)
Debt modification and extinguishment costs		(2,440	)		-			-				(2,440	)
Other, net		5,912			-			-				5,912
Total other income (expense)		(56,839	)		(10,325	)		(52,044	)			(119,208	)
Income before income taxes		660			110,073			(89,624	)			21,109
Income tax expense		(459	)		(42,238	)		35,850		(e)		(6,847	)
Net income		201			67,835			(53,774	)			14,262
Net income attributable to noncontrolling interests (included above)		5,999			-			-				5,999
Net income (loss) attributable to Company	$	(5,798	)	$	67,835		$	(53,774	)		$	8,263
Income (loss) per common share (basic)	$	(0.04	)								$	0.04
Weighted average common shares (basic)		129,275						68,882		(f)		198,157
Income (loss) per common share (assuming dilution)	$	(0.04	)								$	0.04
Weighted average common shares (assuming dilution)		129,275						73,977		(f)		204,717

(a) Reflects the reclassification of revenues of Media General to be consistent with the condensed combined financial statement revenue classification presented.

(b) Reflects the reclassification of certain operating costs of Meredith to be consistent with Media General's presentation.

(c) Reflects the increase in the depreciation and amortization expense resulting from the purchase price allocation of tangible and intangible assets to estimated fair value for Meredith. Depreciation and amortization is based on the estimated remaining useful lives.

(d) Reflects adjustments to interest expense for the repayment of the outstanding Meredith debt, the repayment of Media General's 2021 Notes and the new debt issued by Media General to finance the Meredith Merger, based on an assumed weighted blended interest rate of 5.1%. The new debt to be issued by Media General is anticipated to be comprised of $945.0 million of unsecured financing and $1.855 billion of secured term loans. A 0.125% change in the assumed interest rate (on a blended basis) would increase or decrease annualized cash interest expenses by approximately $3.5 million.

(e) Reflects the tax effect of pro forma adjustments using the statutory rate of approximately 40% in effect for the period presented.

(f) Assumes that the approximately 68.9 million shares of voting common stock estimated to be issued to acquire Meredith were outstanding for the entire period. Diluted common shares include an estimate of the dilutive effect of equity instruments including those expected to be issued to certain Meredith employees to replace outstanding Meredith stock options.

****

The unaudited pro forma condensed combined financial information does not reflect certain events that have occurred or may occur after the Meredith Merger. As such, the combined company’s financial statements may be materially different than the unaudited pro forma condensed combined financial information presented. The following material items are not reflected in the unaudited pro forma condensed combined financial information:

1. Media General expects to swap or otherwise divest certain television stations as part of the process of obtaining regulatory approvals for the Meredith Merger in the following markets: Portland, OR, Nashville, TN, Hartford, CT, Greenville, SC, Mobile, AL, and Springfield, MA. As the stations that will be swapped or otherwise divested are not yet known, the pro forma financial statements do not reflect any adjustments for such contemplated transactions.

2. Meredith Merger transaction costs are excluded from the statements of operations and are reflected on the balance sheet as an adjustment as required by the pro forma rules. GAAP requires these costs to be recorded as period expenses.

3. The pro forma condensed combined statements of operations reflect historical income tax expense of the respective companies and the tax effect of pro forma adjustments at the statutory rate. The effective tax rate of the combined company is expected to be closer to the statutory rate.

4. Following the Meredith Merger, operating synergies of approximately $80 million are estimated to be achieved. These operating synergies are not reflected in the pro forma condensed combined statement of operations.

EX-99.4

Exhibit 99.4

Index to Financial Statements of LIN Media LLC
Unaudited Consolidated Financial Statements of LIN Media LLC
Consolidated Balance Sheets	1
Consolidated Statements of Operations	2
Consolidated Statements of Comprehensive Income	3
Consolidated Statements of Shareholders’ Equity (Deficit)	4
Consolidated Statements of Cash Flows	6
Notes to Unaudited Consolidated Financial Statements (See separate index for Financial Statements of LIN Television Corporation)	7

LIN Media LLC

Consolidated Balance Sheets

(unaudited)

	September 30, 2014			December 31, 2013
	(in thousands, except share data)
ASSETS
Current assets:
Cash and cash equivalents	$	23,382		$	12,525
Marketable securities	174			—
Accounts receivable, less allowance for doubtful accounts (2014 - $4,748; 2013 - $3,188)	145,370			145,309
Deferred income tax assets	5,396			6,898
Other current assets	19,096			15,201
Total current assets	193,418			179,933
Property and equipment, net	214,378			221,078
Deferred financing costs	14,075			16,448
Goodwill	195,421			203,528
Broadcast licenses	491,062			536,515
Other intangible assets, net	44,730			47,049
Other assets	12,127			12,299
Total assets (a)	$	1,165,211		$	1,216,850
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	20,383		$	17,364
Accounts payable	15,485			14,002
Income taxes payable	258			1,420
Accrued expenses	64,197			51,696
Program obligations	7,428			7,027
Total current liabilities	107,751			91,509
Long-term debt, excluding current portion	871,931			927,328
Deferred income tax liabilities	50,712			64,686
Program obligations	2,941			4,146
Other liabilities	21,294			27,209
Total liabilities (a)	1,054,629			1,114,878
Commitments and Contingencies (Note 9)
Redeemable noncontrolling interest	15,165			12,845
LIN Media LLC shareholders’ equity:
Class A common shares, 100,000,000 shares authorized, Issued: 42,802,516 and 39,013,005 shares as of September 30, 2014 and December 31, 2013, respectively. Outstanding: 37,854,857 and 34,065,346 shares as of September 30, 2014 and December 31, 2013, respectively	643,783			624,564
Class B common shares, 50,000,000 shares authorized, 17,901,726 and 20,901,726 shares as of September 30, 2014 and December 31, 2013, respectively, issued and outstanding; convertible into an equal number of shares of class A common or class C common shares	518,365			518,395
Class C common shares, 50,000,000 shares authorized, 2 shares as of September 30, 2014 and December 31, 2013, issued and outstanding; convertible into an equal number of shares of class A common shares	—			—
Treasury shares, 4,947,659 shares of class A common shares as of September 30, 2014 and December 31, 2013, at cost	(21,984		)	(21,984		)
Accumulated deficit	(1,019,738		)	(1,006,322		)
Accumulated other comprehensive loss	(25,009		)	(25,526		)
Total LIN Media LLC shareholders’ equity	95,417			89,127
Total liabilities, redeemable noncontrolling interest and shareholders’ equity	$	1,165,211		$	1,216,850

________________________________________________________________

(a) Our consolidated assets as of September 30, 2014 and December 31, 2013 include total assets of: $54,207 and $56,056 , respectively, of variable interest entities (“VIEs”) that can only be used to settle the obligations of the VIEs. These assets include broadcast licenses and other intangible assets of: $43,477 and $44,677 and program rights of: $1,664 and $2,186 as of September 30, 2014 and December 31, 2013 , respectively. Our consolidated liabilities as of September 30, 2014 and December 31, 2013 include $3,248 and $4,126 , respectively, of total liabilities of the VIEs for which the VIEs’ creditors have no recourse to the Company, including $1,986 and $2,727 , respectively, of program obligations.  See further description in Note 1 — “Basis of Presentation and Summary of Significant Accounting Policies.”

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

1

LIN Media LLC

Consolidated Statements of Operations

(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in thousands, except per share data)						(in thousands, except per share data)
Net revenues	$	192,063		$	163,110		$	547,069		$	468,448
Operating expenses:
Direct operating	76,029			62,504			220,950			180,695
Selling, general and administrative	44,306			41,319			137,554			118,657
Amortization of program rights	6,972			7,605			20,353			22,542
Corporate	8,521			10,682			29,718			30,047
Depreciation	10,892			11,429			32,665			34,387
Amortization of intangible assets	3,788			5,886			15,065			17,038
Impairment of broadcast licenses and goodwill	60,867			—			60,867			—
Restructuring charge	1,084			468			1,084			2,991
Loss (gain) from asset dispositions	42			(9		)	141			173
Operating (loss) income	(20,438		)	23,226			28,672			61,918
Other expense:
Interest expense, net	14,209			13,976			42,568			42,275
Share of loss in equity investments	—			—			100			25
Other (income) expense, net	(768		)	2,055			(851		)	2,115
Total other expense, net	13,441			16,031			41,817			44,415
(Loss) income before (benefit from) provision for income taxes	(33,879		)	7,195			(13,145		)	17,503
(Benefit from) provision for income taxes	(7,996		)	(139,313		)	813			(135,154		)
Net (loss) income	(25,883		)	146,508			(13,958		)	152,657
Net income (loss) attributable to noncontrolling interests	517			(430		)	(542		)	(900		)
Net (loss) income attributable to LIN Media LLC	$	(26,400	)	$	146,938		$	(13,416	)	$	153,557
Basic net (loss) income per common share:
Net (loss) income	$	(0.49	)	$	2.78		$	(0.25	)	$	2.93
Weighted-average number of common shares outstanding used in calculating basic income per common share	54,372			52,791			53,962			52,328
Diluted net (loss) income per common share:
Net (loss) income	$	(0.49	)	$	2.63		$	(0.25	)	$	2.77
Weighted-average number of common shares outstanding used in calculating diluted income per common share	54,372			55,855			53,962			55,378

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

2

LIN Media LLC

Consolidated Statements of Comprehensive (Loss) Income

(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in thousands)						(in thousands)
Net (loss) income	$	(25,883	)	$	146,508		$	(13,958	)	$	152,657
Amortization of pension net losses, reclassified, net of tax of $113 and $169 for the three months ended September 30, 2014 and 2013, respectively, and $338 and $507 for the nine months ended September 30, 2014 and 2013, respectively	172			259			517			777
Comprehensive (loss) income	(25,711		)	146,767			(13,441		)	153,434
Comprehensive income (loss) attributable to noncontrolling interest	517			(430		)	(542		)	(900		)
Comprehensive (loss) income attributable to LIN Media LLC	$	(26,228	)	$	147,197		$	(12,899	)	$	154,334

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

3

LIN Media LLC

Consolidated Statement of Shareholders’ Equity

(unaudited)

(in thousands)

															Accumulated
	Common Shares								Treasury						Other			Total
	Class A			Class B			Class C		Shares			Accumulated			Comprehensive			Shareholders'
	Amount			Amount			Amount		(at cost)			Deficit			Loss			Equity
Balance as of December 31, 2013	$	624,564		$	518,395		$	—	$	(21,984	)	$	(1,006,322	)	$	(25,526	)	$	89,127
Pension liability adjustment, net of tax of $338	—			—			—		—			—			517			517
Issuance of class A common shares	2,480			—			—		—			—			—			2,480
Conversion of class B common shares to class A common shares	30			(30		)	—		—			—			—			—
Tax benefit from exercise of share options and vesting of restricted share awards	13,476			—			—		—			—			—			13,476
Share-based compensation	6,095			—			—		—			—			—			6,095
Noncontrolling interest adjustments	(2,862		)	—			—		—			—			—			(2,862		)
Net loss	—			—			—		—			(13,416		)	—			(13,416		)
Balance as of September 30, 2014	$	643,783		$	518,365		$	—	$	(21,984	)	$	(1,019,738	)	$	(25,009	)	$	95,417

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

4

LIN Media LLC

Consolidated Statement of Shareholders’ Deficit

(unaudited)

(in thousands)

																	Accumulated
	Common Stock							Treasury			Additional						Other			Total
	Class A		Class B			Class C		Stock			Paid-In			Accumulated			Comprehensive			Shareholders'
	Amount		Amount			Amount		(at cost)			Capital			Deficit			Loss			Deficit
Balance as of December 31, 2012	$	313	$	235		$	—	$	(21,984	)	$	1,129,691		$	(1,164,435	)	$	(35,384	)	$	(91,564	)
Pension liability adjustment, net of tax of $507	—		—			—		—			—			—			777			777
Issuance of class A common shares	4		—			—		—			1,450			—			—			1,454
Conversion of class B common shares to class A common shares	26		(26		)	—		—			—			—			—			—
Tax benefit from exercise of share options and vesting of restricted share awards	—		—			—		—			2,180			—			—			2,180
Share-based compensation	—		—			—		—			6,691			—			—			6,691
Effect of 2013 LIN LLC Merger	621,827		518,185			—		—			(1,140,012		)	—			—			—
Net income attributable to LIN Media LLC	—		—			—		—			—			153,557			—			153,557
Balance as of September 30, 2013	$	622,170	$	518,394		$	—	$	(21,984	)	$	—		$	(1,010,878	)	$	(34,607	)	$	73,095

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

5

LIN Media LLC

Consolidated Statements of Cash Flows

(unaudited) 

	Nine Months Ended September 30,
	2014			2013
	(in thousands)
OPERATING ACTIVITIES:
Net (loss) income	$	(13,958	)	$	152,657
Adjustment to reconcile net (loss) income to net cash provided by operating activities:
Depreciation	32,665			34,387
Amortization of intangible assets	15,065			17,038
Impairment of broadcast licenses and goodwill	60,867			—
Amortization of financing costs and note discounts	2,693			2,723
Amortization of program rights	20,353			22,542
Cash payments for programming	(20,444		)	(23,994		)
Share of loss in equity investments	100			25
Deferred income taxes, net	666			(7,144		)
Extinguishment of income tax liability related to the 2013 LIN LLC Merger	—			(132,542		)
Share-based compensation	6,111			6,766
Loss from asset dispositions	141			173
Other, net	2,679			1,291
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	9,526			3,191
Other assets	(7,685		)	(597		)
Accounts payable	(4,137		)	(9,609		)
Accrued interest expense	(598		)	3,761
Other liabilities and accrued expenses	6,339			(12,163		)
Net cash provided by operating activities	110,383			58,505
INVESTING ACTIVITIES:
Capital expenditures	(17,066		)	(21,671		)
Acquisition of broadcast towers	(7,257		)	—
Payments for business combinations, net of cash acquired	(24,825		)	(10,082		)
Proceeds from the sale of assets	114			76
Contributions to equity investments	(100		)	—
Purchase of marketable securities	(174		)	—
Capital contribution to joint venture with NBCUniversal	—			(100,000		)
Net cash used in investing activities	(49,308		)	(131,677		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director share-based compensation	2,480			1,450
Tax benefit from exercises of share options	—			2,180
Proceeds from borrowings on long-term debt	45,000			101,000
Principal payments on long-term debt	(97,698		)	(49,394		)
Payment of long-term debt issue costs	—			(654		)
Net cash (used in) provided by financing activities	(50,218		)	54,582
Net increase (decrease) in cash and cash equivalents	10,857			(18,590		)
Cash and cash equivalents at the beginning of the period	12,525			46,307
Cash and cash equivalents at the end of the period	$	23,382		$	27,717

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

6

LIN Media LLC

Notes to Unaudited Consolidated Financial Statements

Note 1 — Basis of Presentation and Summary of Significant Accounting Policies

Principles of Consolidation

LIN Media LLC (“LIN LLC”), together with its subsidiaries, including LIN Television Corporation, a Delaware corporation (“LIN Television”), is a local multimedia company operating in the United States. LIN LLC and its subsidiaries are affiliates of HM Capital Partners I LP (“HMC”). In these notes, the terms “Company,” “we,” “us” or “our” mean LIN LLC and all subsidiaries included in our consolidated financial statements.

On July 30, 2013, LIN TV Corp., a Delaware corporation (“LIN TV”), completed its merger with and into LIN LLC, a Delaware limited liability company and wholly owned subsidiary of LIN TV, with LIN LLC as the surviving entity (the “2013 LIN LLC Merger”) pursuant to the Agreement and Plan of Merger, dated February 12, 2013, by and between LIN TV and LIN LLC (the “2013 LIN LLC Merger Agreement”).  LIN LLC filed a Current Report on Form 8-K on July 31, 2013 (the “Form 8-K”) for the purpose of establishing LIN LLC as the successor registrant to LIN TV pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and to disclose certain related matters, including the consummation of the 2013 LIN LLC Merger.  Pursuant to Rule 12g-3(a) under the Exchange Act and in accordance with the filing of the Form 8-K, the class A common shares representing limited liability interests in LIN LLC, as the successor registrant to LIN TV, were deemed registered under Section 12(b) of the Exchange Act.  References to "LIN LLC," "we," "us," or the "Company" in this Quarterly Report on Form 10-Q that include any period at and before the effectiveness of the 2013 LIN LLC Merger shall be deemed to refer to LIN TV as the predecessor registrant to LIN LLC.  For more information concerning the effects of the 2013 LIN LLC Merger and the succession of LIN LLC to LIN TV upon its effectiveness, please see the Form 8-K.

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All intercompany accounts and transactions have been eliminated.

In the opinion of management, the accompanying unaudited interim financial statements contain all adjustments necessary to state fairly our financial position, results of operations and cash flows for the periods presented.  The interim results of operations are not necessarily indicative of the results to be expected for the full year.

The accompanying consolidated financial statements include the accounts of our Company, our wholly-owned and majority-owned and controlled subsidiaries, and VIEs for which we are the primary beneficiary. We review all local marketing agreements (“LMAs”), shared services agreements (“SSAs”), joint sales agreements (“JSAs”) and related agreements to evaluate whether consolidation of entities that are party to such arrangements is required under U.S. GAAP.

During the first quarter of 2014, we began operating under two segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites. Our Digital segment includes the operating results of the following digital companies: LIN Digital LLC ("LIN Digital"), LIN Mobile, LLC ("LIN Mobile"), HYFN, Inc. ("HYFN"), Dedicated Media, Inc. ("Dedicated Media"), and Federated Media Publishing LLC ("Federated Media"). Corporate and unallocated expenses primarily include our costs to operate as a public company and to operate our corporate locations. Corporate is not a reportable segment. We have retrospectively recast prior period disclosures to reflect this change in our reportable operating segments. See Note 5 - “Segment Reporting” for further discussion. Prior to January 1, 2014, we had one reportable segment.

We conduct our business through LIN Television and its subsidiaries and we guarantee all of LIN Television’s debt.  All of the consolidated wholly-owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television’s senior secured credit facility, the 8 ³ / ₈ % Senior Notes due 2018 (the “8 ³ / ₈ % Senior Notes”), and the 6 ³ / ₈ % Senior Notes due 2021 (the “6 ³ / ₈ % Senior Notes”) on a joint-and-several basis.

Prior to the 2013 LIN LLC Merger, LIN TV had no operations or assets other than its investments in its subsidiaries. Subsequent to the 2013 LIN LLC Merger and consistent with its classification as a partnership for federal income tax purposes, LIN LLC has separate operations relating to the administration of the partnership. The consolidated financial statements of LIN LLC represent its own operations and the consolidated operations of LIN Television, which remains a corporation after the 2013 LIN LLC Merger.

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On July 24, 2014, we filed a joint proxy statement/prospectus with the Securities and Exchange Commission ("SEC") which was mailed to the shareholders of LIN LLC in connection with a special meeting of the shareholders of LIN LLC to be held on August 20, 2014 for the purpose of voting on the proposal to adopt the Agreement and Plan of Merger, dated March 21, 2014, with Media General, Inc., a Virginia corporation ("Media General"), Mercury New Holdco, Inc., a Virginia corporation (“New Holdco”), Mercury Merger Sub 1, Inc., a Virginia corporation and a direct, wholly-owned subsidiary of New Holdco (“Merger Sub 1”) and Mercury Merger Sub 2, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of New Holdco (“Merger Sub 2”).

On August 20, 2014, we amended the terms of the Merger Agreement (as amended, the "Merger Agreement") following the announcement of CBS Affiliation Relations, a unit of CBS Corporation ("CBS") that it would not renew its network affiliation agreement related to our WISH-TV television station located in Indianapolis, Indiana upon the expiration of that agreement on December 31, 2014. As a result, the special meeting of the shareholders of LIN LLC was convened on August 20, 2014 and then adjourned before conducting any business. On September 15, 2014, we filed a supplement and an updated joint proxy statement/prospectus with the SEC which was mailed to the shareholders of LIN LLC in connection with the special meeting of the shareholders of LIN LLC, and which included a copy of the Merger Agreement. The meeting was held on October 6, 2014 and resulted in the adoption of the Merger Agreement and the approval of the Merger by the LIN LLC shareholders.

On August 20, 2014, we entered into an Asset Purchase Agreement for the sale of television stations WLUK-TV and WCWF-TV, Green Bay-Appleton, Wisconsin, by and among New Holdco and LIN Television, on the one hand, and Harrisburg Television, Inc. on the other hand, dated as of August 20, 2014; an Asset Purchase Agreement for the sale of television station WJCL-TV, Savannah, Georgia, by and among Media General, New Holdco, LIN Television and LIN License Company, LLC on the one hand, and WJCL Hearst Television LLC and Hearst Television Inc. on the other hand, dated as of August 20, 2014; an Asset Purchase Agreement for the sale of certain assets relating to television station WTGS-TV, Hardeeville, South Carolina (Savannah, Georgia market), by and among New Holdco and LIN Television, on the one hand, and Sinclair Communications, LLC on the other hand, dated as of August 20, 2014 (collectively, the “LIN Divestiture Agreements”), to divest certain of our television stations for approximately $70 million , $4.5 million and $17.5 million in cash, respectively, in order to address regulatory considerations related to the transactions contemplated by the Merger Agreement (the "Merger"). In addition, New Holdco, Media General and Meredith Corporation entered into an Asset Purchase Agreement for the sale of WALA-TV, Mobile, Alabama, dated August 20, 2014 (together with the LIN Divestiture Agreements, the “Divestiture Agreements”) in order to address regulatory considerations related to the Merger.

The Divestiture Agreements each contain representations, warranties, covenants and are conditioned on the closing of the Merger pursuant to the Merger Agreement, in addition to, customary closing conditions for transactions of this type, including, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and receipt from the Federal Communications Commission ("FCC") of consent to the transfer of control of broadcast licensee subsidiaries of LIN LLC and Media General in connection with the transactions contemplated by each Divestiture Agreement.

Upon the closing of the Merger and these divestitures, LIN LLC will be merged into, and survived by, New Holdco, LIN Television will become a wholly-owned subsidiary of New Holdco and Media General will become a wholly-owned subsidiary of LIN Television ("New Media General"). The combined company will own and operate or service 71 stations across 48 markets, reaching 27.6 million or approximately 23% of U.S. television households. We currently expect the Merger to close during the fourth quarter of 2014.

Joint Venture Sale Transaction and Merger

On February 12, 2013, we, along with our wholly-owned subsidiaries LIN Television and LIN Television of Texas, L.P., a Delaware limited partnership (“LIN Texas”) entered into an agreement whereby LIN Texas sold its 20.38% equity interest in Station Venture Holdings ("SVH"), a joint venture in which an affiliate of NBCUniversal ("NBC") held the remaining 79.62% equity interest (collectively, the “JV Sale Transaction”). Pursuant to the JV Sale Transaction, LIN Television made a $100 million capital contribution to SVH and in turn, was released from the guarantee of an $815.5 million note held by SVH ("GECC Guarantee") as well as any further obligations related to any shortfall funding agreements between LIN Television and SVH.

Concurrent with the closing of the JV Sale Transaction, LIN TV entered into the 2013 LIN LLC Merger Agreement. The 2013 LIN LLC Merger enabled the surviving entity to be classified as a partnership for federal income tax purposes and the change in classification was treated as a liquidation of LIN TV for federal income tax purposes, with the result that LIN TV realized a capital loss in its 100% equity interest in LIN Television.

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For further discussion of the JV Sale Transaction and the 2013 LIN LLC Merger, refer to Item 1. "Business," Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies," and Note 13 - "Commitments and Contingencies" to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013 (the "10-K").

Variable Interest Entities

In determining whether we are the primary beneficiary of a VIE for financial reporting purposes, we consider whether we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and whether we have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. We consolidate VIEs when we are the primary beneficiary.

We have a JSA and an SSA with WBDT Television, LLC (“WBDT”) for WBDT-TV in the Dayton, OH market. We also have JSAs and SSAs with affiliates of Vaughan Acquisition LLC (“Vaughan”) for WTGS-TV in the Savannah, GA market, WYTV-TV in the Youngstown, OH market and KTKA-TV in the Topeka, KS market and SSAs with KASY-TV Licensee, LLC (“KASY”), KWBQ-TV, KRWB-TV and KASY-TV in the Albuquerque, Santa-Fe, NM market. Under these agreements, we provide administrative services to these stations, have an obligation to reimburse certain of the stations' expenses, and we are compensated through a performance-based fee structure that provides us the benefit of certain returns from the operation of these stations. We determined that WBDT, Vaughan and KASY are VIEs and as a result of the JSAs and/or SSAs, we have variable interests in these entities. We are the primary beneficiary of these entities, and therefore, we consolidate these entities within our consolidated financial statements.

An order that the FCC adopted in March 2014, however, will require changes in our relationship with these entities going forward. In that order, the FCC concluded that JSAs should be “attributable” for purposes of the media ownership rules if they permit a television licensee to sell more than 15% of the commercial inventory of a television station owned by a third party in the same market. Stations with JSAs that would put them in violation of the new rules will have until June 19, 2016 to amend or terminate those arrangements, unless they are able to obtain a waiver of such rules. Accordingly, absent further developments, we will be required to modify or terminate our existing JSAs by no later than June 19, 2016.

The carrying amounts and classifications of the assets and liabilities of the variable interest entities described above, which have been included in our consolidating balance sheets as of September 30, 2014 and December 31, 2013 are as follows (in thousands):

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	September 30, 2014		December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	422	$	278
Accounts receivable, net	6,390		6,345
Other assets	847		927
Total current assets	7,659		7,550
Property and equipment, net	2,054		2,469
Broadcast licenses and other intangible assets, net	43,477		44,677
Other assets	1,017		1,360
Total assets	$	54,207	$	56,056
LIABILITIES
Current liabilities:
Current portion of long-term debt	$	1,162	$	1,162
Accounts payable	60		63
Accrued expenses	1,201		1,336
Program obligations	986		1,303
Total current liabilities	3,409		3,864
Long-term debt, excluding current portion	2,134		3,005
Program obligations	1,000		1,424
Other liabilities	47,664		47,763
Total liabilities	$	54,207	$	56,056

The assets of our consolidated VIEs can only be used to settle the obligations of the VIEs and may not be sold, or otherwise disposed of, except for assets sold or replaced with others of like kind or value. Other liabilities of $47.7 million and $47.8 million as of September 30, 2014 and December 31, 2013 , respectively, serve to reduce the carrying value of the entities, and are eliminated in our consolidated financial statements. This reflects the fact that as of September 30, 2014 and December 31, 2013 , LIN Television has an option that it may exercise if the FCC attribution rules change. The option would allow LIN Television to acquire the assets or member’s interest of the VIE entities for a nominal exercise price, which is significantly less than the carrying value of their tangible and intangible net assets. The options are carried at zero on our consolidated balance sheet, as any value attributable to the options is eliminated in the consolidation of the VIEs. In an order adopted in March 2014, the FCC concluded that JSAs should be “attributable” for purposes of the media ownership rules if they permit a television licensee to sell more than 15% of the commercial inventory of a television station owned by a third party in the same market. Stations with JSAs that would put them in violation of the new rules will have until June 19, 2016 to amend or terminate those arrangements, unless they are able to obtain a waiver of such rules. Accordingly, absent further developments, or the grant of waivers, we will be required to modify or terminate our existing JSAs no later than June 19, 2016.

Redeemable Noncontrolling Interest

The redeemable noncontrolling interest as of September 30, 2014 includes the interest of minority shareholders of HYFN and Dedicated Media. During the nine months ended September 30, 2014, we reclassified the interest of the minority shareholders of Nami Media, Inc. ("Nami Media") to permanent equity, as the mandatory redemption feature of Nami Media's minority shareholders' interest terminated in February 2014. In addition, during the third quarter of 2014, we adjusted the mandatory redeemable noncontrolling interest associated with Dedicated Media to equal $8.6 million , which represents our current estimate of the second stage purchase obligation for the minority shares of Dedicated Media. For further discussion, refer to Note 2 - "Acquisitions." The following table presents the activity of the redeemable noncontrolling interest included in our consolidated balance sheets, which represents third parties’ proportionate share of our consolidated net assets (in thousands):

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	Redeemable Noncontrolling Interest
Balance as of December 31, 2013	$	12,845
Net loss	(542		)
Share-based compensation and other	16
Accretion of mandatory purchase obligation of Dedicated Media	4,971
Reclassification to permanent equity	(2,125		)
Balance as of September 30, 2014	$	15,165

During the third quarter of 2014, Nami Media ceased operations. As a result, we reorganized our digital operations and transferred certain operating assets of Nami Media to LIN Digital. As of September 30, 2014, there are no longer noncontrolling interests in Nami Media and we have transferred the balance of noncontrolling interest related to Nami Media to Class A common shares in our statement of shareholders' equity for the nine months ended September 30, 2014.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the notes thereto. Our actual results could differ from these estimates. Estimates are used for the allowance for doubtful accounts in receivables, valuation of goodwill and intangible assets, assumptions used to determine fair value of financial instruments, amortization and impairment of program rights and intangible assets, share-based compensation and other long-term incentive compensation arrangements, pension costs, barter transactions, income taxes, employee medical insurance claims, useful lives of property and equipment, contingencies, litigation and net assets of businesses acquired.

Net Earnings per Common Share

Basic earnings per share (“EPS”) is computed by dividing income attributable to common shareholders by the number of weighted-average outstanding common shares.  Diluted EPS reflects the effect of the assumed exercise of share options and vesting of restricted shares only in the periods in which such effect would have been dilutive.

The following table sets forth the computation of the common shares outstanding used in determining basic and diluted EPS (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
Denominator for EPS calculation:	2014	2013	2014	2013
Weighted-average common shares, basic	54,372	52,791	53,962	52,328
Effect of dilutive securities:	0		0
Share options and unvested restricted shares	—	3,064	—	3,050
Weighted-average common shares, diluted	54,372	55,855	53,962	55,378

We apply the treasury stock method to measure the dilutive effect of our outstanding share options and restricted share awards and include the respective common share equivalents in the denominator of our diluted EPS calculation.  We have excluded all common shares issuable for share options and restricted shares from the calculation of diluted earnings per share for the three and nine months ended September 31, 2014 because the net loss causes these outstanding shares to be anti-dilutive. Securities representing 0.1 million shares of common stock for the three and nine months ended September 30, 2013 , respectively, were excluded from the computation of diluted EPS for these periods because their effect would have been anti-dilutive.  The net income per share amounts are the same for our class A, class B and class C common shares because the holders of each class are legally entitled to equal per share distributions whether through dividends or in liquidation.

Cash and Cash Equivalents

We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

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Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") and the International Accounting Standards Board ("IASB") issued a converged standard on revenue recognition from contracts with customers, ASU 2014-09 (Topic 606 and IFRS 15). This standard will supersede nearly all existing revenue recognition guidance. ASU 2014-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. We are currently evaluating the impact this guidance will have on our financial condition, results of operations and cash flows.

In April 2014, the FASB issued Accounting Standard Update No. 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity" ("ASU 2014-08"). ASU 2014-08 changes the threshold for disclosing discontinued operations and the related disclosure requirements. Pursuant to ASU 2014-08, only disposals representing a strategic shift, such as a major line of business, a major geographical area or a major equity investment, should be presented as a discontinued operation. ASU 2014-08 is effective for annual periods beginning on or after December 15, 2014 with early adoption permitted but only for disposals or classifications as held for sale which have not been reported in financial statements previously issued or available for issuance. We have not yet adopted this new guidance and are currently evaluating the impact that it will have on our disclosures and consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, "Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." This ASU establishes specific guidance to an organization's management on their responsibility to evaluate whether there is substantial doubt about the organization's ability to continue as a going concern. We have not yet adopted this standard and are currently evaluating the impact that the new guidance will have on our disclosures and consolidated financial statements.

Note 2 — Acquisitions

Federated Media Publishing, Inc.

On February 3, 2014, LIN Digital Media LLC, a wholly owned subsidiary of LIN Television, acquired 100% of the capital stock of Federated Media Publishing, Inc., which we subsequently converted into a Delaware limited liability company ("Federated Media"). Federated Media is a digital content and conversational marketing company that leverages the relationships and content from its publishing network to deliver contextually relevant advertising and conversational and engagement tools that reach agencies’ and brands’ targeted audiences across digital and social media platforms. The purchase price totaled $22.5 million , net of cash, including post-closing adjustments, and was funded from cash on hand and amounts drawn on our revolving credit facility.

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by us in the acquisition (in thousands):

Current assets	$	9,811
Property and equipment	72
Non-current assets	195
Other intangible assets	11,497
Goodwill	7,306
Current liabilities	(6,367		)
Total	$	22,514

The amount allocated to definite-lived intangible assets represents the estimated fair values of publisher relationships of $4.2 million , customer relationships of $1.2 million , completed technology of $3.9 million , and trademarks of $2.2 million . These intangible assets will be amortized over the estimated remaining useful lives of approximately 8 years for publisher relationships, 4  years for customer relationships, 3  years for completed technology and 7 years for trademarks.

Goodwill of $7.3 million is the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired, and primarily represents the benefits of the incremental revenue we expect to generate from the acquisition of Federated Media.  All of the goodwill recognized in connection with the acquisition of Federated Media is deductible for tax purposes.

Net revenues and operating loss of Federated Media included in our consolidated statements of operations for the nine months ended September 30, 2014 were $17.1 million and $0.8 million , respectively.

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Dedicated Media, Inc.

On April 9, 2013, LIN Television acquired a 60% interest (calculated on a fully diluted basis) in Dedicated Media, a multi-channel advertisement buying and optimization company.  Under the terms of our agreement with Dedicated Media, we agreed to purchase the remaining outstanding shares of Dedicated Media by no later than February 15, 2015 if Dedicated Media achieves both (i) a target earnings before interest, taxes, depreciation and amortization (“EBITDA”) and (ii) a target gross profit in 2014, as outlined in the purchase agreement.  The purchase price of these shares is based on multiples of Dedicated Media’s 2014 EBITDA and gross profit.  As of September 30, 2014, we concluded it was probable that Dedicated Media would achieve at least the minimum levels of gross profit and adjusted EBITDA required to obligate LIN LLC to purchase the remaining outstanding shares of Dedicated Media.  Based on management’s current projections of Dedicated Media’s 2014 gross profit and adjusted EBITDA, we estimate the purchase price for the remaining outstanding shares to be approximately $8.6 million and accordingly, we have adjusted the mandatory redeemable noncontrolling interest account for Dedicated Media to equal this estimated obligation and have recorded a corresponding decrease to equity on our statement of shareholders' equity for the nine months ended September 30, 2014.  We believe the stage two purchase price of $8.6 million represents the fair value of the stage two shares to be acquired. This estimate is subject to change based on Dedicated Media’s actual results in 2014, which will be determined during the first quarter of 2015. Our maximum potential obligation under the purchase agreement is $26 million . 

HYFN, Inc.

On April 4, 2013, LIN Television acquired a 50.1% interest (calculated on a fully diluted basis) in HYFN, a full service digital advertising agency specializing in the planning, development, deployment and support for websites, mobile sites, interactive banners, games and various applications for multiple devices.  Under the terms of our agreement with HYFN, we agreed to purchase the remaining outstanding shares of HYFN by no later than February 15, 2016 if HYFN achieves both (i) a target EBITDA and (ii) target net revenues in 2015, as outlined in the transaction agreements.  The purchase price of these shares is based on multiples of HYFN’s 2015 net revenue and EBITDA.  Our maximum potential obligation under the terms of our agreement is approximately $62.4 million .  If HYFN does not meet the target EBITDA or target net revenues in 2015, we have the option to purchase the remaining outstanding shares using the same purchase price multiple. As of September 30, 2014 , we believe that achievement of the financial targets by HYFN is not yet probable and therefore, have not reflected this obligation in our consolidated financial statements.

Our obligations to purchase the noncontrolling interest holders’ shares of both Dedicated Media and HYFN are outside of our control, because they are based on the achievement of certain financial targets described above. Therefore, the noncontrolling interests related to Dedicated Media and HYFN as of September 30, 2014 has been reported as redeemable noncontrolling interest and classified as temporary equity on our consolidated balance sheets.

If we do not purchase the remaining outstanding shares of Dedicated Media or HYFN by the dates set forth in the respective purchase agreements, the noncontrolling interest holders have the right to purchase our interest. The purchase price of these shares is based on the same purchase price multiple described above and is exercisable only if the applicable financial targets are not met and we do not elect to purchase the remaining interest. The fair value of this option is zero and no amounts related to these options are included in our consolidated financial statements as of September 30, 2014 .

Pro Forma Information

The following table sets forth unaudited pro forma results of operations for the nine months ended September 30, 2014 and 2013 assuming that the above acquisitions of Federated Media, Dedicated Media and HYFN along with transactions necessary to finance the acquisitions, occurred on January 1, 2013 (in thousands except per share amounts):

	Nine Months Ended   September 30, 2014			Nine Months Ended   September 30, 2013
Net revenue	$	548,436		$	500,229
Net (loss) income	$	(14,818	)	$	144,688
Basic (loss) income per common share attributable to LIN LLC	$	(0.27	)	$	2.77
Diluted (loss) income per common share attributable to LIN LLC	$	(0.27	)	$	2.61

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This pro forma financial information is based on historical results of operations, adjusted for the allocation of the purchase price and other acquisition accounting adjustments, and is not necessarily indicative of what our results would have been had we operated the business since January 1, 2013. The pro forma adjustments for the nine months ended September 30, 2014 and 2013 reflect depreciation expense, amortization of intangibles related to the fair value adjustments of the assets acquired, additional interest expense related to the financing of the transaction and the related tax effects of the adjustments.

In connection with the acquisition of Federated Media, we and Federated Media incurred a combined total of $0.8 million of transaction related costs primarily related to legal and other professional services. These costs were not included in the 2014 pro forma amounts. The 2013 pro forma net income was adjusted to include these costs, as they are directly attributable to the acquisition of Federated Media.

Note 3 — Intangible Assets

Goodwill totaled $195.4 million and $203.5 million at September 30, 2014 and December 31, 2013 , respectively. The change in the carrying amount of goodwill during the nine months ended September 30, 2014 was as follows (in thousands):

	Goodwill
Broadcast:
Balance as of December 31, 2013	$	185,237
Acquisitions	—
Impairment charge	(15,413		)
Balance as of September 30, 2014	$	169,824
Digital:
Balance as of December 31, 2013	$	18,291
Acquisitions	7,306
Balance as of September 30, 2014	$	25,597
Total:
Balance as of December 31, 2013	$	203,528
Acquisitions	7,306
Impairment charge	(15,413		)
Balance as of September 30, 2014	$	195,421

The following table summarizes the carrying amounts of intangible assets (in thousands):

	September 30, 2014					December 31, 2013
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Broadcast licenses	$	491,062	$	—		$	536,515	$	—
Intangible assets subject to amortization (1)	98,712		(53,982		)	85,966		(38,917		)
Total	$	589,774	$	(53,982	)	$	622,481	$	(38,917	)

(1) Intangible assets subject to amortization are amortized on a straight line basis and primarily include network affiliations, acquired customer and publisher relationships, completed technology, brand names, non-compete agreements, internal-use software, favorable operating leases, and retransmission consent agreements.

On August 11, 2014, CBS announced that it would not renew its network affiliation agreement related to WISH-TV in Indianapolis, Indiana when that agreement expires on December 31, 2014.  This announcement prompted us to perform an interim impairment test of the broadcast licenses and goodwill associated with our Indianapolis market as of September 30, 2014.

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We used the income approach to test our asset group and reporting unit for impairment as of September 30, 2014 and as a result, recorded an impairment charge in our Broadcast segment of $60.9 million during the third quarter 2014, resulting in a remaining balance of zero goodwill and $15.8 million attributable to the broadcast licenses in our Indianapolis market.

Note 4— Debt

LIN LLC guarantees all of LIN Television’s debt.  All of the consolidated 100% owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television’s senior secured credit facility, the 8 ³ / ₈ % Senior Notes due 2018 (the “8 ³ / ₈ % Senior Notes”), and the 6 ³ / ₈ % Senior Notes due 2021 (the “6 ³ / ₈ % Senior Notes”) on a joint-and-several basis.

Debt consisted of the following (in thousands):

	September 30, 2014		December 31, 2013
Senior Secured Credit Facility:
Revolving credit loans	$	—	$	5,000
$100,370 and $118,750 Term loans, net of discount of $278 and $345 as September 30, 2014 and December 31, 2013, respectively	100,092		118,405
$286,128 and $314,200 Incremental term loans, net of discount of $1,431 and $1,684 as of September 30, 2014 and December 31, 2013, respectively	284,697		312,516
8 3 / 8 % Senior Notes due 2018	200,000		200,000
6 3 / 8 % Senior Notes due 2021	290,000		290,000
Capital lease obligations	14,228		14,604
Other debt	3,297		4,167
Total debt	892,314		944,692
Less current portion	20,383		17,364
Total long-term debt	$	871,931	$	927,328

During the three and nine months ended September 30, 2014 , we paid $38.6 million and $46.5 million , respectively, of principal on the term loans and incremental term loans related to mandatory quarterly and optional payments under our senior secured credit facility, respectively.

During the nine months ended September 30, 2014, we drew $45 million on our revolving credit facility to fund the acquisition of Federated Media as well as normal operating activities. We subsequently made payments against these borrowings, resulting in an outstanding balance on our revolving credit facility of zero as of September 30, 2014 .

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

	September 30, 2014		December 31, 2013
Carrying amount	$	878,085	$	930,088
Fair value	889,194		954,255

Note 5 — Segment Reporting

During the first quarter of 2014, we began operating under two operating segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites, and our Digital segment includes the operating results of the following digital companies; LIN Digital, LIN Mobile, HYFN, Dedicated Media, and Federated Media. Unallocated corporate expenses primarily include our costs to operate as a public company and to operate our corporate locations.

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We use earnings before interest, taxes, depreciation and amortization, excluding non-recurring charges, restructuring charges, share-based compensation, loss or gain on sales of assets, and adjusting amortization of program rights to deduct cash paid for programming (“Adjusted EBITDA”) as the primary financial measure reported to the chief executive officer (the chief operating decision maker) for use in assessing our operating segments’ operating performance. We believe that this measure is useful to investors because it eliminates significant non-cash expenses and non-recurring charges and as a result, allows investors to better understand our operating segments’ performance. All adjustments to Adjusted EBITDA presented below to arrive at consolidated income before income taxes except for depreciation and amortization and cash paid for programming relate primarily to corporate activities. Cash paid for programming pertains only to our Broadcast segment. As a result, we have disclosed depreciation and amortization by segment, as this is the only adjustment to operating income that the chief executive officer reviews on a segment basis. We have retrospectively recast prior period disclosures to reflect this change in our reportable segments.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
	(in thousands)
Net revenues:
Broadcast	$	159,733	$	143,594	$	457,029	$	419,054
Digital	32,330		19,516		90,040		49,394
Total net revenues	$	192,063	$	163,110	$	547,069	$	468,448

The following table is a reconciliation of Adjusted EBITDA to consolidated income before provision for income taxes:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in thousands)
Segment Adjusted EBITDA:
Broadcast	$	63,040		$	50,869		$	169,290		$	142,628
Digital	3,547			1,236			3,209			3,196
Total segment Adjusted EBITDA	66,587			52,105			172,499			145,824
Unallocated corporate Adjusted EBITDA	(6,445		)	(5,927		)	(19,671		)	(15,735		)
Less:
Depreciation	10,892			11,429			32,665			34,387
Amortization of intangible assets	3,788			5,886			15,065			17,038
Amortization of program rights	6,972			7,605			20,353			22,542
Impairment of broadcast licenses and goodwill	60,867			—			60,867			—
Share-based compensation	1,765			2,238			6,111			6,766
Non-recurring (1) and acquisition-related charges	1,830			3,257			8,314			8,268
Restructuring charge	1,084			468			1,084			2,991
Loss (gain) on sale of assets	42			(9		)	141			173
Add:
Cash payments for programming	6,660			7,922			20,444			23,994
Operating (loss) income	(20,438		)	23,226			28,672			61,918
Other expense:
Interest expense, net	14,209			13,976			42,568			42,275
Share of loss in equity investments	—			—			100			25
Other (income) expense, net	(768		)	2,055			(851		)	2,115
Total other expense, net	13,441			16,031			41,817			44,415
Consolidated (loss) income before provision for income taxes	$	(33,879	)	$	7,195		$	(13,145	)	$	17,503

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_______________________________

⁽¹⁾ Non-recurring charges for the three and nine months ended September 30, 2014 primarily consist of expenses related to the Merger and non-recurring charges for the three and nine months ended September 30, 2013 primarily consist of expenses related to the 2013 LIN LLC Merger.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in thousands)
Operating (loss) income:
Broadcast	$	(11,098	)	$	35,235		$	67,051		$	95,933
Digital	801			9			(3,299		)	251
Unallocated corporate	(10,141		)	(12,018		)	(35,080		)	(34,266		)
Total operating (loss) income	$	(20,438	)	$	23,226		$	28,672		$	61,918

	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
	(in thousands)
Depreciation and amortization:
Broadcast	$	12,176	$	15,938	$	40,530	$	48,048
Digital	1,927		1,206		5,683		2,883
Unallocated corporate	577		171		1,517		494
Total depreciation and amortization	$	14,680	$	17,315	$	47,730	$	51,425

	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
	(in thousands)
Capital expenditures:
Broadcast	$	3,906	$	5,359	$	12,211	$	16,728
Digital	1,261		1,353		3,647		3,036
Unallocated corporate	436		789		1,208		1,907
Total capital expenditures	$	5,603	$	7,501	$	17,066	$	21,671

	September 30, 2014		December 31, 2013
	(in thousands)
Assets:
Broadcast	$	1,012,135	$	1,100,343
Digital	94,608		69,690
Unallocated corporate	58,468		46,817
Total assets	$	1,165,211	$	1,216,850

Note 6 — Retirement Plans

The following table shows the components of the net periodic pension cost and the contributions to our 401(k) Plan and the retirement plans (in thousands):

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	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Net periodic pension cost:
Interest cost	$	1,509		$	1,314		$	4,528		$	3,942
Expected return on plan assets	(1,771		)	(1,670		)	(5,311		)	(5,010		)
Amortization of net loss	284			428			853			1,284
Net periodic cost	$	22		$	72		$	70		$	216
Contributions:
401(k) Plan	$	1,134		$	1,229		$	3,279		$	3,653
Defined contribution retirement plans	54			59			126			143
Defined benefit retirement plans	2,584			1,231			5,264			3,944
Total contributions	$	3,772		$	2,519		$	8,669		$	7,740

See Note 10 — “Retirement Plans” in Item 15 of our 10-K for a full description of our retirement plans.

Note 7 — Restructuring

As of December 31, 2013 , we had a restructuring accrual of $0.4 million related to severance and related costs as a result of the integration of the television stations acquired during 2012 as well as severance and related costs at some of our digital companies.  During the three and nine months ended September 30, 2014 , we recorded a restructuring charge of $1.1 million for severance and related costs at our stations and digital operations. During the three and nine months, we made cash payments of $0.7 million and $1 million , respectively, related to these restructuring actions.  We expect to make cash payments of approximately $0.5 million during the remainder of the year with respect to such transactions.

The activity for these restructuring actions is as follows (in thousands):

	Severance and Related
Balance as of December 31, 2013	$	423
Charges	1,084
Payments	(965		)
Balance as of September 30, 2014	$	542

Note 8 — Income Taxes

We recorded a benefit from income taxes of $8 million and a provision for income taxes of $0.8 million for the three and nine months ended September 30, 2014 , respectively, compared to a benefit from income taxes of $139.3 million and $135.2 million for the three and nine months ended September 30, 2013 , respectively.  The benefit from income taxes for the three months ended September 30, 2014 was primarily a result of an $18.4 million discrete tax benefit recognized as a result of the impairment charge recorded during the third quarter of 2014 related to the carrying value of the broadcast licenses and goodwill in our Indianapolis market whereas, the provision for income taxes for the nine months ended September 30, 2014 was primarily a result of our income from operations before tax. The benefit from income taxes for the three and nine months ended September 30, 2013 was primarily a result of a $124.6 million discrete tax benefit recognized as a result of the 2013 LIN LLC Merger as well as an $18.2 million discrete tax benefit recognized as a result of the reversal of a state valuation allowance during the third quarter of 2013. Our effective income tax rate was (6.2)% and (772.2)% for the nine months ended September 30, 2014 and September 30, 2013 , respectively.  The change in the effective income tax rate was primarily a result of the discrete tax benefit recognized during the third quarter 2013 as a result of the 2013 LIN LLC Merger and the reversal of a state valuation allowance during the third quarter of 2013. We expect our effective income tax rate to range between 40% and 42% during the remainder of 2014 .

During the first quarter of 2013, approximately $162.8 million of short term deferred tax liabilities were reclassified to income taxes payable upon the consummation of the JV Sale Transaction. As a result of the close of the 2013 LIN LLC Merger on

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July 30, 2013, $131.5 million of this tax liability was extinguished, resulting in a remaining tax liability of approximately $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this liability during the fourth quarter of 2013.  For further discussion regarding the income tax effects of the JV Sale Transaction and the 2013 LIN LLC Merger, see Note 1 — “Basis of Presentation and Summary of Significant Accounting Policies” and Note 13 — “Commitments and Contingencies” to our consolidated financial statements in our 10-K.

Note 9 — Commitments and Contingencies

We lease land, buildings, vehicles and equipment pursuant to non-cancelable operating lease agreements and we contract for general services pursuant to non-cancelable operating agreements that expire at various dates through 2036. In addition, we have entered into commitments for future syndicated entertainment and sports programming. Future payments for these non-cancelable operating leases and agreements, and future payments associated with syndicated television programs as of September 30, 2014 are as follows (in thousands):

Commitments

Year	Operating Leases and Agreements		Syndicated Television Programming			Total
2014	$	12,100	$	7,118	(1)	$	19,218
2015	62,443		28,201			90,644
2016	54,624		19,714			74,338
2017	64,320		4,882			69,202
2018	59,451		277			59,728
Thereafter	104,985		214			105,199
Total obligations	$	357,923	$	60,406		$	418,329

⁽¹⁾ Includes $10.4 million of program obligations recorded on our consolidated balance sheet as of September 30, 2014.

Contingencies

GECC Guarantee and the 2013 LIN LLC Merger

As further described in Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies," pursuant to the JV Sale Transaction, LIN Television made a $100 million capital contribution to SVH and in turn, was released from the GECC Guarantee as well as any further obligations related to any shortfall funding agreements between LIN Television and SVH.

In February 2013, we entered into a $60 million Incremental Facility and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million payment.

As a result of the JV Sale Transaction, after utilizing all of our available Federal net operating loss (“NOL”) carryforwards, we had an approximate $162.8 million income tax payable remaining, $131.5 million of which was extinguished as a result of the 2013 LIN LLC Merger. We made state and federal tax payments to settle the remaining liability of $31.3 million during the fourth quarter of 2013.

For further discussion of the GECC Guarantee and the 2013 LIN LLC Merger, refer to Note 13 - "Commitments and Contingencies" to our consolidated financial statements in our 10-K.

The Merger

We expect to incur approximately $1.5 - $2.5 million of legal and professional fees associated with the Merger and related financing during the fourth quarter of 2014. Contingent upon the consummation of the Merger and dependent upon the price of Media General's Class A common stock on the date of consummation, we will incur an advisory fee payable to J.P. Morgan Securities LLC, which we expect will be funded from the proceeds of Media General’s transaction financing. Based on the price of Media General's Class A common stock as of November 7, 2014, this advisory fee is estimated to be approximately $19.7 million , of which $1.5 million has already been paid. This advisory fee is contingent upon the consummation of the

19

Merger and is not earned by JP Morgan until the Merger occurs. As of the date of this report, the necessary approval has not been obtained from the FCC and as a result, there is no assurance that the Merger and the corresponding advisory fee to be paid to JP Morgan will occur. As a result we do not deem the payment of the advisory fee to be probable and accordingly, did not record an obligation for this amount as of September 30, 2014 .

Litigation

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

Following the announcement on March 21, 2014 of the execution of the Merger Agreement, three complaints were filed in the Delaware Court of Chancery challenging the proposed acquisition of LIN LLC: Sciabacucchi v. Lin Media LLC, et al. (C.A. No. 9530) (the “Sciabacucchi Action”), International Union of Operating Engineers Local 132 Pension Fund v. Lin Media LLC, et al. (C.A. No.9538) (the “Pension Fund Action”), and Pryor v. Lin Media LLC, et al. (C.A. No. 9577) (the “Pryor Action”). The litigations are putative class actions filed on behalf of the public stockholders of LIN LLC and name as defendants LIN LLC, our directors, Media General, New Holdco, Merger Sub 1 and Merger Sub 2 and HM Capital Partners LLC and several of its alleged affiliates (Hicks, Muse, Tate & Furst Equity Fund III, L.P.; HM3 Coinvestors, L.P.; Hicks, Muse, Tate & Furst Equity Fund IV, L.P.; Hicks, Muse, Tate & Furst Private Equity Fund IV, L.P.; HM4EQ Coinvestors, L.P.; Hicks, Muse & Co. Partners, L.P.; Muse Family Enterprises, Ltd.; and JRM Interim Investors, L.P. (together with HM Capital Partners LLC and individual director defendant John R. Muse, which we collectively refer to as “HMC”)).

On April 18, 2014, the plaintiff in the Pension Fund Action voluntarily dismissed that action without prejudice and, on April 21, 2014, the Court approved the dismissal.

On April 25, 2014, the plaintiff in the Sciabacucchi Action filed an amended complaint, and the plaintiffs in the Sciabacucchi and Pryor Actions each filed a motion for an expedited hearing on the plaintiff’s (yet-to-be filed) motion for a permanent injunction to enjoin the Merger, requesting, among other things, that the Court set a permanent injunction hearing for September 2014. On April 30, 2014, the plaintiffs in the Sciabacucchi and Pryor Actions filed a stipulation to consolidate the two actions, which was approved by the Court on May 1, 2014.

The operative complaint generally alleges that the individual defendants breached their fiduciary duties in connection with their consideration and approval of the Merger, that the entity defendants aided and abetted those breaches and that individual director defendant Royal W. Carson III and HMC breached their fiduciary duties as controlling shareholders of LIN LLC by causing LIN LLC to enter into the Merger, which plaintiffs allege will provide disparate consideration to HMC. The complaint seeks, among other things, declaratory and injunctive relief enjoining the Merger.

On May 15, 2014, plaintiffs in the consolidated action sent a letter to the Court withdrawing the pending motion to expedite.

The outcome of the lawsuit is uncertain and cannot be predicted with any certainty. An adverse judgment for monetary damages could have a material adverse effect on our operations and liquidity. An adverse judgment granting permanent injunctive relief could indefinitely enjoin completion of the Merger.

On October 3, 2014, LIN LLC received an appraisal rights notice from Cede & Co., the nominee of The Depository Trust Company, and purported holder of 44,585 LIN LLC common shares.  Pursuant to the Merger Agreement and limited liability company agreement of LIN LLC, holders of LIN LLC common shares are entitled to demand appraisal and shall be entitled to payment from LIN LLC, after consummation of the Merger, of the fair value of the holder’s dissenting shares; provided, that the holder of such shares takes all required actions under applicable law to properly demand appraisal.  The outcome of this appraisal notice cannot be predicted with any certainty at this time.  

Note 10 — Condensed Consolidating Financial Statements

LIN Television, a 100% owned subsidiary of LIN LLC, is the primary obligor of our senior secured credit facility, our 8 ³ / ₈ % Senior Notes and our 6 ³ / ₈ % Senior Notes, which are further described in Note 4 — “Debt”.  LIN LLC fully and unconditionally

20

guarantees all of LIN Television’s debt on a joint-and-several basis.  Additionally, all of the consolidated 100% owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television’s senior secured credit facility, our 8 ³ / ₈ % Senior Notes and our 6 ³ / ₈ % Senior Notes on a joint-and-several basis, subject to customary release provisions.  There are certain contractual restrictions on LIN Television’s ability to obtain funds in the form of dividends or loans from the non-guarantor subsidiaries.

The following condensed consolidating financial statements present the consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income and consolidated statements of cash flows of LIN LLC, LIN Television, as the issuer, the guarantor subsidiaries, and the non-guarantor subsidiaries of LIN Television and the elimination entries necessary to consolidate or combine the issuer with the guarantor and non-guarantor subsidiaries.  These statements are presented in accordance with the disclosure requirements under SEC Regulation S-X Rule 3-10.

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Condensed Consolidating Balance Sheet

As of September 30, 2014

(in thousands)

	LIN Media LLC		LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	2,138	$	19,066	$	1,150	$	1,028	$	—		$	23,382
Marketable securities	—		174		—		—		—			174
Accounts receivable, net	—		79,511		43,208		22,651		—			145,370
Deferred income tax assets	—		3,492		1,864		40		—			5,396
Other current assets	—		14,963		2,518		1,615		—			19,096
Total current assets	2,138		117,206		48,740		25,334		—			193,418
Property and equipment, net	—		173,197		38,630		2,551		—			214,378
Deferred financing costs	—		14,002		—		73		—			14,075
Goodwill	—		154,079		30,328		11,014		—			195,421
Broadcast licenses	—		—		448,361		42,701		—			491,062
Other intangible assets, net	—		22,083		14,389		8,258		—			44,730
Advances to consolidated subsidiaries	1,998		8,606		932,266		—		(942,870		)	—
Investment in consolidated subsidiaries	91,281		1,470,786		—		—		(1,562,067		)	—
Other assets	—		52,569		3,051		951		(44,444		)	12,127
Total assets	$	95,417	$	2,012,528	$	1,515,765	$	90,882	$	(2,549,381	)	$	1,165,211
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	—	$	19,137	$	—	$	1,246	$	—		$	20,383
Accounts payable	—		5,473		7,157		2,855		—			15,485
Income taxes payable	—		15		243		—		—			258
Accrued expenses	—		50,389		10,501		3,307		—			64,197
Program obligations	—		5,334		1,108		986		—			7,428
Total current liabilities	—		80,348		19,009		8,394		—			107,751
Long-term debt, excluding current portion	—		869,759		—		2,172		—			871,931
Deferred income tax liabilities	—		13,844		36,209		659		—			50,712
Program obligations	—		1,815		126		1,000		—			2,941
Intercompany liabilities	—		934,264		—		8,606		(942,870		)	—
Other liabilities	—		21,217		77		44,444		(44,444		)	21,294
Total liabilities	—		1,921,247		55,421		65,275		(987,314		)	1,054,629
Redeemable noncontrolling interest	—		—		—		15,165		—			15,165
												—
Total shareholders’ equity (deficit)	95,417		91,281		1,460,344		10,442		(1,562,067		)	95,417
Total liabilities, redeemable noncontrolling interest and shareholders’ equity (deficit)	$	95,417	$	2,012,528	$	1,515,765	$	90,882	$	(2,549,381	)	$	1,165,211

22

Condensed Consolidating Balance Sheet

As of December 31, 2013

(in thousands)

	LIN Media LLC		LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	10,313	$	3	$	2,209	$	—		$	12,525
Accounts receivable, net	—		88,905		39,416		16,988		—			145,309
Deferred income tax assets	—		5,818		1,080		—		—			6,898
Other current assets	—		12,264		1,049		1,888		—			15,201
Total current assets	—		117,300		41,548		21,085		—			179,933
Property and equipment, net	—		180,480		35,752		4,846		—			221,078
Deferred financing costs	—		16,357		—		91		—			16,448
Goodwill	—		169,492		18,518		15,518		—			203,528
Broadcast licenses	—		—		493,814		42,701		—			536,515
Other intangible assets, net	—		31,303		1,840		13,906		—			47,049
Advances to consolidated subsidiaries	1,900		7,764		968,728		—		(978,392		)	—
Investment in consolidated subsidiaries	87,227		1,534,600		—		—		(1,621,827		)	—
Other assets	—		52,778		2,688		1,276		(44,443		)	12,299
Total assets	$	89,127	$	2,110,074	$	1,562,888	$	99,423	$	(2,644,662	)	$	1,216,850
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	—	$	16,112	$	—	$	1,252	$	—		$	17,364
Accounts payable	—		4,185		5,339		4,478		—			14,002
Income taxes payable	—		749		671		—		—			1,420
Accrued expenses	—		42,570		6,254		2,872		—			51,696
Program obligations	—		4,711		1,013		1,303		—			7,027
Total current liabilities	—		68,327		13,277		9,905		—			91,509
Long-term debt, excluding current portion	—		924,223		—		3,105		—			927,328
Deferred income tax liabilities	—		30,013		33,824		849		—			64,686
Program obligations	—		2,505		217		1,424		—			4,146
Intercompany liabilities	—		970,628		—		7,764		(978,392		)	—
Other liabilities	—		27,151		58		44,443		(44,443		)	27,209
Total liabilities	—		2,022,847		47,376		67,490		(1,022,835		)	1,114,878
Redeemable noncontrolling interest	—		—		—		12,845		—			12,845
Total shareholders’ equity (deficit)	89,127		87,227		1,515,512		19,088		(1,621,827		)	89,127
Total liabilities, redeemable noncontrolling interest and shareholders’ equity (deficit)	$	89,127	$	2,110,074	$	1,562,888	$	99,423	$	(2,644,662	)	$	1,216,850

23

Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2014

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—		$	118,815		$	60,190		$	19,197	$	(6,139	)	$	192,063
Operating expenses:
Direct operating	—			40,855			26,034			12,346		(3,206		)	76,029
Selling, general and administrative	—			28,321			12,740			3,411		(166		)	44,306
Amortization of program rights	—			5,194			1,432			346		—			6,972
Corporate	352			7,583			50			544		(8		)	8,521
Depreciation	—			8,957			1,685			250		—			10,892
Amortization of intangible assets	—			2,091			931			766		—			3,788
Impairment of broadcast licenses and goodwill	—			15,414			45,453			—		—			60,867
Restructuring charge	—			846			238			—		—			1,084
Loss (gain) from asset dispositions	—			43			(2		)	1		—			42
Operating (loss) income	(352		)	9,511			(28,371		)	1,533		(2,759		)	(20,438		)
Other (income) expense:
Interest expense, net	—			14,163			(1		)	47		—			14,209
Intercompany fees and expenses	(272		)	7,478			(7,606		)	150		250			—
Other, net	—			(37		)	(731		)	—		—			(768		)
Total other (income) expense, net	(272		)	21,604			(8,338		)	197		250			13,441
(Loss) income before (benefit from) provision for income taxes	(80		)	(12,093		)	(20,033		)	1,336		(3,009		)	(33,879		)
(Benefit from) provision for income taxes	—			(204		)	(8,013		)	221		—			(7,996		)
Net (loss) income	(80		)	(11,889		)	(12,020		)	1,115		(3,009		)	(25,883		)
Equity in (loss) income from operations of consolidated subsidiaries	(26,320		)	(14,181		)	—			—		40,501			—
Net (loss) income	(26,400		)	(26,070		)	(12,020		)	1,115		37,492			(25,883		)
Net income attributable to noncontrolling interests	—			—			—			517		—			517
Net (loss) income attributable to LIN Media LLC	$	(26,400	)	$	(26,070	)	$	(12,020	)	$	598	$	37,492		$	(26,400	)

24

Condensed Consolidating Statement of Comprehensive Loss

For the Three Months Ended September 30, 2014

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net (loss) income	$	(26,400	)	$	(26,070	)	$	(12,020	)	$	1,115	$	37,492		$	(25,883	)
Amortization of pension net losses, net of tax of $113	172			172			—			—		(172		)	172
Comprehensive (loss) income	(26,228		)	(25,898		)	(12,020		)	1,115		37,320			(25,711		)
Comprehensive income attributable to noncontrolling interest	—			—			—			517		—			517
Comprehensive (loss) income attributable to LIN Media LLC	$	(26,228	)	$	(25,898	)	$	(12,020	)	$	598	$	37,320		$	(26,228	)

25

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2014

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—		$	338,293		$	172,454		$	54,597		$	(18,275	)	$	547,069
Operating expenses:
Direct operating	—			119,514			76,002			34,757			(9,323		)	220,950
Selling, general and administrative	—			85,825			38,582			13,821			(674		)	137,554
Amortization of program rights	—			14,919			4,236			1,198			—			20,353
Corporate	1,056			27,992			134			544			(8		)	29,718
Depreciation	—			26,780			4,999			886			—			32,665
Amortization of intangible assets	—			9,220			2,409			3,436			—			15,065
Impairment of broadcast licenses and goodwill	—			15,414			45,453			—			—			60,867
Restructuring charge	—			846			238			—			—			1,084
Loss (gain) from asset dispositions	—			19			133			(11		)	—			141
Operating (loss) income	(1,056		)	37,764			268			(34		)	(8,270		)	28,672
Other (income) expense:
Interest expense, net	—			42,431			(1		)	138			—			42,568
Share of loss in equity investments				100			—			—			—			100
Intercompany fees and expenses	(813		)	22,794			(23,155		)	424			750			—
Other, net	—			(131		)	(720		)	—			—			(851		)
Total other (income) expense, net	(813		)	65,194			(23,876		)	562			750			41,817
(Loss) income before (benefit from) provision for income taxes	(243		)	(27,430		)	24,144			(596		)	(9,020		)	(13,145		)
(Benefit from) provision for income taxes	—			(8,614		)	9,658			(231		)	—			813
Net (loss) income	(243		)	(18,816		)	14,486			(365		)	(9,020		)	(13,958		)
Equity in (loss) income from operations of consolidated subsidiaries	(13,173		)	6,393			—			—			6,780			—
Net (loss) income	(13,416		)	(12,423		)	14,486			(365		)	(2,240		)	(13,958		)
Net income (loss) attributable to noncontrolling interests	—			—			—			(542		)	—			(542		)
Net (loss) income attributable to LIN Media LLC	$	(13,416	)	$	(12,423	)	$	14,486		$	177		$	(2,240	)	$	(13,416	)

26

Condensed Consolidating Statement of Comprehensive Loss

For the Nine Months Ended September 30, 2014

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net (loss) income	$	(13,416	)	$	(12,423	)	$	14,486	$	(365	)	$	(2,240	)	$	(13,958	)
Amortization of pension net losses, net of tax of $338	517			517			—		—			(517		)	517
Comprehensive (loss) income	(12,899		)	(11,906		)	14,486		(365		)	(2,757		)	(13,441		)
Comprehensive income (loss) attributable to noncontrolling interest	—			—			—		(542		)	—			(542		)
Comprehensive (loss) income attributable to LIN Media LLC	$	(12,899	)	$	(11,906	)	$	14,486	$	177		$	(2,757	)	$	(12,899	)

27

Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2013

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—		$	106,982		$	45,335		$	14,458		$	(3,665	)	$	163,110
Operating expenses:
Direct operating	—			37,105			17,973			9,532			(2,106		)	62,504
Selling, general and administrative	—			27,223			10,785			3,351			(40		)	41,319
Amortization of program rights	—			5,695			1,382			528			—			7,605
Corporate	277			10,405			—			—			—			10,682
Depreciation	—			9,285			1,788			356			—			11,429
Amortization of intangible assets	—			4,430			234			1,222			—			5,886
Restructuring charge	—			468			—			—			—			468
Gain from asset dispositions	—			(8		)	(1		)	—			—			(9		)
Operating (loss) income	(277		)	12,379			13,174			(531		)	(1,519		)	23,226
Other expense (income):
Interest expense, net	—			14,146			—			(67		)	(103		)	13,976
Intercompany fees and expenses	—			7,891			(8,102		)	211			—			—
Other, net	—			2,053			1			1			—			2,055
Total other expense (income), net	—			24,090			(8,101		)	145			(103		)	16,031
(Loss) income before (benefit from) provision for income taxes	(277		)	(11,711		)	21,275			(676		)	(1,416		)	7,195
(Benefit from) provision for income taxes	—			(147,671		)	8,510			(152		)	—			(139,313		)
Net (loss) income	(277		)	135,960			12,765			(524		)	(1,416		)	146,508
Equity in income (loss) from operations of consolidated subsidiaries	147,215			11,255			—			—			(158,470		)	—
Net income (loss)	146,938			147,215			12,765			(524		)	(159,886		)	146,508
Net loss attributable to noncontrolling interests	—			—			—			(430		)	—			(430		)
Net income (loss) attributable to LIN Media LLC	$	146,938		$	147,215		$	12,765		$	(94	)	$	(159,886	)	$	146,938

28

Condensed Consolidating Statement of Comprehensive Income

For the Three Months Ended September 30, 2013

(in thousands)

	LIN Media LLC		LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net income (loss)	$	146,938	$	147,215	$	12,765	$	(524	)	$	(159,886	)	$	146,508
Amortization of pension net losses, net of tax of $169	259		259		—		—			(259		)	259
Comprehensive income (loss)	147,197		147,474		12,765		(524		)	(160,145		)	146,767
Comprehensive loss attributable to noncontrolling interest	—		—		—		(430		)	—			(430		)
Comprehensive income (loss) attributable to LIN Media LLC	$	147,197	$	147,474	$	12,765	$	(94	)	$	(160,145	)	$	147,197

29

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2013

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net revenues	$	—		$	311,221		$	130,972		$	35,841		$	(9,586	)	$	468,448
Operating expenses:
Direct operating	—			108,313			54,886			22,825			(5,329		)	180,695
Selling, general and administrative	—			80,611			30,008			8,341			(303		)	118,657
Amortization of program rights	—			16,709			4,281			1,552			—			22,542
Corporate	277			29,770			—			—			—			30,047
Depreciation	—			27,954			5,420			1,013			—			34,387
Amortization of intangible assets	—			13,334			701			3,003			—			17,038
Restructuring charge	—			2,991			—			—			—			2,991
Loss (gain) from asset dispositions	—			193			(20		)	—			—			173
Operating (loss) income	(277		)	31,346			35,696			(893		)	(3,954		)	61,918
Other expense (income):
Interest expense, net	—			42,124			—			151			—			42,275
Share of loss in equity investments	—			25			—			—			—			25
Intercompany fees and expenses	—			24,491			(24,702		)	211			—			—
Other, net	—			2,113			1			1			—			2,115
Total other expense (income), net	—			68,753			(24,701		)	363			—			44,415
(Loss) income before (benefit from) provision for income taxes	(277		)	(37,407		)	60,397			(1,256		)	(3,954		)	17,503
(Benefit from) provision for income taxes	—			(158,607		)	24,159			(706		)	—			(135,154		)
Net (loss) income	(277		)	121,200			36,238			(550		)	(3,954		)	152,657
Equity in income (loss) from operations of consolidated subsidiaries	153,834			32,634			—			—			(186,468		)	—
Net income (loss)	153,557			153,834			36,238			(550		)	(190,422		)	152,657
Net loss attributable to noncontrolling interests	—			—			—			(900		)	—			(900		)
Net income (loss) attributable to LIN Media LLC	$	153,557		$	153,834		$	36,238		$	350		$	(190,422	)	$	153,557

30

Condensed Consolidating Statement of Comprehensive Income

For the Nine Months Ended September 30, 2013

(in thousands)

	LIN Media LLC		LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
Net income (loss)	$	153,557	$	153,834	$	36,238	$	(550	)	$	(190,422	)	$	152,657
Amortization of pension net losses, net of tax of $507	777		777		—		—			(777		)	777
Comprehensive income (loss)	154,334		154,611		36,238		(550		)	(191,199		)	153,434
Comprehensive loss attributable to noncontrolling interest	—		—		—		(900		)	—			(900		)
Comprehensive income (loss) attributable to LIN Media LLC	$	154,334	$	154,611	$	36,238	$	350		$	(191,199	)	$	154,334

31

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2014

(in thousands)

	LIN Media LLC			LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities	$	(342	)	$	86,790		$	27,913		$	(3,228	)	$	(750	)	$	110,383
INVESTING ACTIVITIES:
Capital expenditures	—			(12,113		)	(3,610		)	(1,343		)	—			(17,066		)
Acquisition of broadcast towers	—			(7,257		)	—			—			—			(7,257		)
Payments for business combinations, net of cash acquired	—			(24,825		)	—			—			—			(24,825		)
Proceeds from the sale of assets	—			112			2			—			—			114
Contributions to equity investments	—			(100		)	—			—			—			(100		)
Marketable securities	—			(174		)	—			—			—			(174		)
Receipt of dividend	—			58,508			—			—			(58,508		)	—
Advances on intercompany borrowings	—			(4,329		)	—			—			4,329			—
Payments from intercompany borrowings	—			—			35,350			—			(35,350		)	—
Net cash provided by (used in) investing activities	—			9,822			31,742			(1,343		)	(89,529		)	(49,308		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director share-based compensation	2,480			—			—			—			—			2,480
Proceeds from borrowings on long-term debt	—			45,000			—			—			—			45,000
Principal payments on long-term debt	—			(96,759		)	—			(939		)	—			(97,698		)
Payment of dividend	—			(750		)	(58,508		)	—			59,258			—
Proceeds from intercompany borrowings	—			—			—			4,329			(4,329		)	—
Payments on intercompany borrowings	—			(35,350		)	—			—			35,350			—
Net cash provided by (used in)financing activities	2,480			(87,859		)	(58,508		)	3,390			90,279			(50,218		)
Net increase (decrease) in cash and cash equivalents	2,138			8,753			1,147			(1,181		)	—			10,857
Cash and cash equivalents at the beginning of the period	—			10,313			3			2,209			—			12,525
Cash and cash equivalents at the end of the period	$	2,138		$	19,066		$	1,150		$	1,028		$	—		$	23,382

32

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2013

(in thousands)

	LIN Media LLC		LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Media LLC Consolidated
OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	1,801	$	76,031		$	41,463		$	(282	)	$	(60,508	)	$	58,505
INVESTING ACTIVITIES:
Capital expenditures	—		(17,094		)	(2,372		)	(2,205		)	—			(21,671		)
Payments for business combinations, net of cash acquired	—		(10,082		)	—			—			—			(10,082		)
Proceeds from the sale of assets	—		56			20			—			—			76
Capital contributions to joint venture with NBCUniversal	—		—			(100,000		)	—			—			(100,000		)
Advances on intercompany borrowings	—		(4,400		)	—			—			4,400			—
Payments from intercompany borrowings	—		15,009			133,835			—			(148,844		)	—
Net cash (used in) provided by investing activities	—		(16,511		)	31,483			(2,205		)	(144,444		)	(131,677		)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director share-based compensation	199		1,251			—			—			—			1,450
Tax benefit from exercises of share options	—		2,180			—			—			—			2,180
Proceeds from borrowings on long-term debt	—		101,000			—			—			—			101,000
Principal payments on long-term debt	—		(48,385		)	—			(1,009		)	—			(49,394		)
Payment of long-term debt issue costs	—		(654		)	—			—			—			(654		)
Payment of dividend	—		(2,000		)	(58,508		)	—			60,508			—
Proceeds from intercompany borrowings	—		—			—			4,400			(4,400		)	—
Payments on intercompany borrowings	—		(133,835		)	(15,009		)	—			148,844			—
Net cash (used in) provided by financing activities	199		(80,443		)	(73,517		)	3,391			204,952			54,582
Net (decrease) increase in cash and cash equivalents	2,000		(20,923		)	(571		)	904			—			(18,590		)
Cash and cash equivalents at the beginning of the period	—		44,625			573			1,109			—			46,307
Cash and cash equivalents at the end of the period	$	2,000	$	23,702		$	2		$	2,013		$	—		$	27,717

33

Table of Contents

Item 1. Unaudited Consolidated Financial Statements of LIN Television Corporation

Consolidated Balance Sheets	2
Consolidated Statements of Operations	3
Consolidated Statements of Comprehensive Income	4
Consolidated Statement of Stockholder’s Equity (Deficit)	5
Consolidated Statements of Cash Flows	6
Notes to Unaudited Consolidated Financial Statements	7

1

LIN Television Corporation
Consolidated Balance Sheets
(unaudited)

	September 30, 2014			December 31, 2013
	(in thousands, except share data)
ASSETS
Current assets:
Cash and cash equivalents	$	21,244		$	12,525
Marketable securities		174			-
Accounts receivable, less allowance for doubtful accounts (2014 - $4,748; 2013 - $3,188)		145,371			145,409
Deferred income tax assets		5,396			6,898
Other current assets		19,096			15,201
Total current assets		191,281			180,033
Property and equipment, net		214,378			221,078
Deferred financing costs		14,075			16,448
Goodwill		195,421			203,528
Broadcast licenses		491,062			536,515
Other intangible assets, net		44,730			47,049
Other assets		12,127			12,299
Total assets (a)	$	1,163,074		$	1,216,950
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDER'S EQUITY
Current liabilities:
Current portion of long-term debt	$	20,383		$	17,364
Accounts payable		15,485			14,002
Income taxes payable		258			1,420
Accrued expenses		64,197			51,696
Program obligations		7,428			7,027
Total current liabilities		107,751			91,509
Long-term debt, excluding current portion		873,931			929,328
Deferred income tax liabilities		50,712			64,686
Program obligations		2,941			4,146
Other liabilities		21,294			27,209
Total liabilities (a)		1,056,629			1,116,878
Commitments and Contingencies (Note 9)
Redeemable noncontrolling interest		15,165			12,845
LIN Television Corporation stockholder’s equity:
Common stock, $0.01 par value, 1,000 shares	–			–
Investment in parent company’s shares, at cost		(21,984	)		(21,984	)
Additional paid-in capital		1,157,079			1,140,370
Accumulated deficit		(1,018,806	)		(1,005,633	)
Accumulated other comprehensive loss		(25,009	)		(25,526	)
Total stockholder’s equity		91,280			87,227
Noncontrolling interest	–			–
Total equity		91,280			87,227
Total liabilities, noncontrolling interest and equity	$	1,163,074		$	1,216,950

(a) Our consolidated assets as of September 30, 2014 and December 31, 2013 include total assets of: $54,207 and $56,056, respectively, of variable interest entities (“VIEs”) that can only be used to settle the obligations of the VIEs. These assets include broadcast licenses and other intangible assets of: $43,477 and $44,677 and program rights of: $1,664 and $2,186 as of September 30, 2014 and December 31, 2013, respectively. Our consolidated liabilities as of September 30, 2014 and December 31, 2013 include $3,248 and $4,126, respectively, of total liabilities of the VIEs for which the VIEs’ creditors have no recourse to the Company, including $1,986 and $2,727, respectively, of program obligations. See further description in Note 1 - “Basis of Presentation and Summary of Significant Accounting Policies.”

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

2

LIN Television Corporation
Consolidated Statements of Operations
(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in thousands, except per share data)						(in thousands, except per share data)
Net revenues	$	192,063		$	163,110		$	547,069		$	468,448
Operating expenses:
Direct operating		76,029			62,504			220,950			180,695
Selling, general and administrative		44,306			41,319			137,554			118,657
Amortization of program rights		6,972			7,605			20,353			22,542
Corporate		8,169			10,405			28,662			29,770
Depreciation		10,892			11,429			32,665			34,387
Amortization of intangible assets		3,788			5,886			15,065			17,038
Impairment of broadcast licenses and goodwill		60,867			-			60,867			-
Restructuring charge		1,084			468			1,084			2,991
Loss (gain) from asset dispositions		42			(9	)		141			173
Operating (loss) income		(20,086	)		23,503			29,728			62,195
Other expense:
Interest expense, net		14,231			13,976			42,631			42,275
Share of loss in equity investments		-			-			100			25
Other (income) expense, net		(768	)		2,055			(851	)		2,115
Total other expense, net		13,463			16,031			41,880			44,415
(Loss) income before (benefit from) provision for income taxes		(33,549	)		7,472			(12,152	)		17,780
(Benefit from) provision for income taxes		(7,996	)		(139,313	)		813			(135,154	)
Net (loss) income		(25,553	)		146,785			(12,965	)		152,934
Net income (loss) attributable to noncontrolling interests		517			(430	)		(542	)		(900	)
Net income attributable to LIN Television Corporation	$	(26,070	)	$	147,215		$	(12,423	)	$	153,834

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

3

LIN Television Corporation
Consolidated Statements of Comprehensive (Loss) Income
(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in thousands)						(in thousands)
Net (loss) income	$	(25,553	)	$	146,785		$	(12,965	)	$	152,934
Amortization of pension net losses, reclassified, net of tax of $113 and $169 for the three months ended September 30, 2014 and 2013, respectively, and $338 and $507 for the nine months ended September 30, 2014 and 2013, respectively		172			259			517			777
Comprehensive (loss) income		(25,381	)		147,044			(12,448	)		153,711
Comprehensive income (loss) attributable to noncontrolling interest		517			(430	)		(542	)		(900	)
Comprehensive (loss) income attributable to LIN Television Corporation	$	(25,898	)	$	147,474		$	(11,906	)	$	154,611

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

4

LIN Television Corporation
Consolidated Statement of Stockholder’s Equity
(unaudited)
(in thousands)

					Investment
	Common Stock				in Parent
	Shares		Amount		Company’s Common Shares, at cost			Additional Paid-in Capital			Accumulated Deficit			Accumulated  Other Comprehensive Loss			Total Stockholder’s Equity
Balance as of December 31, 2013		1,000	–		$	(21,984	)	$	1,140,370		$	(1,005,633	)	$	(25,526	)	$	87,227
Pension liability adjustment, net of tax of $338	–		–		–			–			–				517			517
Tax benefit from exercise of share options and vesting of restricted share awards	–		–		–				13,476		–			–				13,476
Share–based compensation	–		–		–				6,095		–			–				6,095
Noncontrolling interest adjustments									(2,862	)								(2,862	)
Dividends declared	–		–		–			–				(750	)	–				(750	)
Net income	–		–		–			–				(12,423	)	–				(12,423	)
Balance as of September 30, 2014		1,000	$	–	$	(21,984	)	$	1,157,079		$	(1,018,806	)	$	(25,009	)	$	91,280

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

5

LIN Television Corporation
Consolidated Statement of Stockholder’s Deficit
(unaudited)
(in thousands)

					Investment
	Common Stock				in Parent
	Shares		Amount		Company’s Common Shares, at cost			Additional Paid-in Capital		Accumulated Deficit			Accumulated Other Comprehensive Loss			Total Stockholder’s Equity
Balance as of December 31, 2013		1,000	$	–	$	(21,984	)	$	1,130,239	$	(1,164,435	)	$	(35,384	)	$	(91,564	)
Pension liability adjustment, net of tax of $507	–		–		–			–		–				777			777
Issuance of LIN TV Corp. class A common stock	–		–		–				1,255	–			–				1,255
Tax benefit from exercise of stock options and vesting of restricted stock awards	–		–		–				2,180	–			–				2,180
Stock-based compensation	–		–		–				6,691	–			–				6,691
Dividends declared	–		–		–			–			(2000	)	–
Net income	–		–		–			–			153,834		–				153,834
Balance as of September 30, 2013		1,000	$	–	$	(21,984	)	$	1,140,365	$	(1,012,601	)	$	(34,607	)	$	71,173

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

6

LIN Television Corporation
Consolidated Statements of Cash Flows
(unaudited)

	Nine Months Ended September 30,
	2014			2013
	(in thousands)
OPERATING ACTIVITIES
Net (loss) income	$	(12,965	)	$	152,934
Adjustment to reconcile net income to net cash provided by operating activities:
Depreciation		32,665			34,387
Amortization of intangible assets		15,065			17,038
Impairment of broadcast licenses and goodwill		60,867		–
Amortization of financing costs and note discounts		2,693			2,723
Amortization of program rights		20,353			22,542
Cash payments for programming		(20,444	)		(23,994	)
Share of loss in equity investments		100			25
Stock–based compensation		6,111			6,766
Deferred income taxes, net		666			(7,144	)
Extinguishment of income tax liability related to the 2013 LIN LLC Merger	–				(132,542	)
Loss from asset dispositions		141			173
Other, net		2,679			1,291
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		9,625			3,113
Other assets		(7,685	)		(597	)
Accounts payable		(4,137	)		(9,609	)
Accrued interest expense		(598	)		3,761
Other liabilities and accrued expenses		6,339			(12,163	)
Net cash provided by operating activities		111,475			58,704
INVESTING ACTIVITIES:
Capital expenditures		(17,066	)		(21,671	)
Acquisition of broadcast towers		(7,257	)	–
Payments for business combinations, net of cash acquired		(24,825	)		(10,082	)
Proceeds from the sale of assets		114			76
Contributions to equity investments		(100	)	–
Purchase of marketable securities		(174	)	–
Capital contribution to joint venture with NBCUniversal	–				(100,000	)
Net cash used in investing activities		(49,308	)		(131,677	)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director stock–based compensation	–				1,251
Tax benefit from exercise of stock options	–				2,180
Proceeds from borrowings on long–term debt		45,000			101,000
Payment of dividend		(750	)		(2,000	)
Principal payments on long–term debt		(97,698	)		(49,394	)
Payment of long–term debt issue costs	–				(654	)
Net cash (used in) provided by financing activities		(53,448	)		52,383
Net increase (decrease) in cash and cash equivalents		8,719			(20,590	)
Cash and cash equivalents at the beginning of the period d		12,525			46,307
Cash and cash equivalents at the end of the period	$	21,244		$	25,717

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

7

LIN Television Corporation
Notes to Unaudited Consolidated Financial Statements

Note 1 - Basis of Presentation and Summary of Significant Accounting Policies

Principles of Consolidation

LIN Television Corporation, a Delaware corporation (“LIN Television”), together with its subsidiaries, is a local multimedia company operating in the United States. LIN Television and its subsidiaries are affiliates of HM Capital Partners I LP (“HMC”). In these notes, the terms “Company,” “we,” “us” or “our” mean LIN Television and all subsidiaries included in our consolidated financial statements. LIN Television is a wholly-owned subsidiary of LIN Media LLC (“LIN LLC”).

On July 30, 2013, LIN TV Corp., a Delaware corporation (“LIN TV”), completed its merger with and into LIN LLC, a Delaware limited liability company and wholly owned subsidiary of LIN TV, with LIN LLC as the surviving entity (the “2013 LIN LLC Merger”) pursuant to the Agreement and Plan of Merger, dated February 12, 2013, by and between LIN TV and LIN LLC (the “2013 LIN LLC Merger Agreement”). LIN LLC filed a Current Report on Form 8-K on July 31, 2013 (the “Form 8-K”) for the purpose of establishing LIN LLC as the successor registrant to LIN TV pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and to disclose certain related matters, including the consummation of the 2013 LIN LLC Merger. Pursuant to Rule 12g-3(a) under the Exchange Act and in accordance with the filing of the Form 8-K, the class A common shares representing limited liability interests in LIN LLC, as the successor registrant to LIN TV, were deemed registered under Section 12(b) of the Exchange Act. References to "LIN LLC," "we," "us," or the "Company" in this Quarterly Report on Form 10-Q that include any period at and before the effectiveness of the 2013 LIN LLC Merger shall be deemed to refer to LIN TV as the predecessor registrant to LIN LLC. For more information concerning the effects of the 2013 LIN LLC Merger and the succession of LIN LLC to LIN TV upon its effectiveness, please see the Form 8-K.

LIN LLC has no independent assets or operations and guarantees all of our debt. All of the consolidated wholly-owned subsidiaries of LIN Television fully and unconditionally guarantee our Senior Secured Credit Facility, 83/8% Senior Notes due 2018 (the “83/8% Senior Notes”) and 63/8% Senior Notes due 2021 (the “63/8% Senior Notes”) on a joint-and-several basis, subject to customary release provisions.

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All intercompany accounts and transactions have been eliminated.

In the opinion of management, the accompanying unaudited interim financial statements contain all adjustments necessary to state fairly our financial position, results of operations and cash flows for the periods presented. The interim results of operations are not necessarily indicative of the results to be expected for the full year.

The accompanying consolidated financial statements include the accounts of our Company, our wholly-owned and majority-owned and controlled subsidiaries, and VIEs for which we are the primary beneficiary. We review all local marketing agreements (“LMAs”), shared services agreements (“SSAs”), joint sales agreements (“JSAs”) and related agreements, to evaluate whether consolidation of entities that are party to such arrangements is required under U.S. GAAP.

During the first quarter of 2014, we began operating under two segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites. Our Digital segment includes the operating results of the following digital companies: LIN Digital LLC ("LIN Digital"), LIN Mobile, LLC ("LIN Mobile"), HYFN, Inc. ("HYFN"), Dedicated Media, Inc. ("Dedicated Media"), and Federated Media Publishing LLC ("Federated Media"). Corporate and unallocated expenses primarily include our costs to operate as a public company and to operate our corporate locations. Corporate is not a reportable segment. We have retrospectively recast prior period disclosures to reflect this change in our reportable operating segments. See Note 5 - “Segment Reporting” for further discussion. Prior to January 1, 2014, we had one reportable segment.

8

On July 24, 2014, LIN LLC filed a joint proxy statement/prospectus with the Securities and Exchange Commission ("SEC") which was mailed to the shareholders of LIN LLC in connection with a special meeting of the shareholders of LIN LLC to be held on August 20, 2014 for the purpose of voting on the proposal to adopt the Agreement and Plan of Merger, dated March 21, 2014, with Media General, Inc., a Virginia corporation ("Media General"), Mercury New Holdco, Inc., a Virginia corporation (“New Holdco”), Mercury Merger Sub 1, Inc., a Virginia corporation and a direct, wholly-owned subsidiary of New Holdco (“Merger Sub 1”), Mercury Merger Sub 2, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of New Holdco (“Merger Sub 2”).

On August 20, 2014, LIN LLC amended the terms of the Merger Agreement (as amended, the "Merger Agreement") following the announcement of CBS Affiliation Relations, a unit of CBS Corporation ("CBS") that it would not renew its network affiliation agreement related to our WISH-TV television station located in Indianapolis, Indiana upon the expiration of that agreement on December 31, 2014. As a result, the special meeting of the shareholders of LIN LLC was convened on August 20, 2014 and then adjourned before conducting any business. On September 15, 2014, LIN LLC filed a supplement and an updated joint proxy statement/prospectus with the SEC which was mailed to the shareholders of LIN LLC in connection with the special meeting of the shareholders of LIN LLC and which included a copy of the Merger Agreement. The meeting was held on October 6, 2014 and resulted in the adoption of the Merger Agreement and the approval of the Merger by the LIN LLC shareholders.

On August 20, 2014, we entered into an Asset Purchase Agreement for the sale of television stations WLUK-TV and WCWF-TV, Green Bay-Appleton, Wisconsin, by and among New Holdco and LIN Television, on the one hand, and Harrisburg Television, Inc. on the other hand, dated as of August 20, 2014; an Asset Purchase Agreement for the sale of television station WJCL-TV, Savannah, Georgia, by and among Media General, New Holdco, LIN Television and LIN License Company, LLC on the one hand, and WJCL Hearst Television LLC and Hearst Television Inc. on the other hand, dated as of August 20, 2014; an Asset Purchase Agreement for the sale of certain assets relating to television station WTGS-TV, Hardeeville, South Carolina (Savannah, Georgia market), by and among New Holdco and LIN Television, on the one hand, and Sinclair Communications, LLC on the other hand, dated as of August 20, 2014 (collectively, the “LIN Divestiture Agreements”), to divest certain of our television stations for approximately $70 million, $4.5 million and $17.5 million in cash, respectively, in order to address regulatory considerations related to the transactions contemplated by the Merger Agreement (the "Merger"). In addition, New Holdco, Media General and Meredith Corporation entered into an Asset Purchase Agreement for the sale of WALA-TV, Mobile, Alabama, dated August 20, 2014 (together with the LIN Divestiture Agreements, the “Divestiture Agreements”), in order to address regulatory considerations related to the Merger.

The Divestiture Agreements each contain representations, warranties, covenants and are conditioned on the closing of the Merger pursuant to the Merger Agreement, in addition to, customary closing conditions for transactions of this type, including, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and receipt from the Federal Communications Commission ("FCC") of consent to the transfer of control of broadcast licensee subsidiaries of LIN LLC and Media General in connection with the transactions contemplated by each Divestiture Agreement.

Upon the closing of the Merger and these divestitures, LIN LLC will be merged into, and survived by, New Holdco, LIN Television will become a wholly-owned subsidiary of New Holdco and Media General will become a wholly-owned subsidiary of LIN Television ("New Media General"). The combined company will own and operate or service 71 stations across 48 markets, reaching 27.6 million or approximately 23% of U.S. television households. We currently expect the Merger to close during the fourth quarter of 2014.

Joint Venture Sale Transaction and Merger

On February 12, 2013, we, along with LIN TV and LIN Television of Texas, L.P., a Delaware limited partnership (“LIN Texas”) entered into an agreement whereby LIN Texas sold its 20.38% equity interest in Station Venture Holdings ("SVH"), a joint venture in which an affiliate of NBCUniversal ("NBC"), held the remaining 79.62% equity interest (collectively, the “JV Sale Transaction”). Pursuant to the JV Sale Transaction, LIN Television made a $100 million capital contribution to SVH and in turn, LIN TV was released from the guarantee of an $815.5 million note held by SVH ("GECC Guarantee") as well as any further obligations related to any shortfall funding agreements between us and SVH.

9

Concurrent with the closing of the JV Sale Transaction, LIN TV entered into the 2013 LIN LLC Merger Agreement. The 2013 LIN LLC Merger enabled the surviving entity to be classified as a partnership for federal income tax purposes and the change in classification was treated as a liquidation of LIN TV for federal income tax purposes, with the result that LIN TV realized a capital loss in its 100% equity interest in LIN Television.

For further discussion of the JV Sale Transaction and the 2013 LIN LLC Merger, refer to Item 1. "Business," Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies" and Note 13 - "Commitments and Contingencies" to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013 (the "10-K").

Variable Interest Entities

In determining whether we are the primary beneficiary of a VIE for financial reporting purposes, we consider whether we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and whether we have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. We consolidate VIEs when we are the primary beneficiary.

We have a JSA and an SSA with WBDT Television, LLC (“WBDT”) for WBDT-TV in the Dayton, OH market. We also have JSAs and SSAs with affiliates of Vaughan Acquisition LLC (“Vaughan”) for WTGS-TV in the Savannah, GA market, WYTV-TV in the Youngstown, OH market and KTKA-TV in the Topeka, KS market and SSAs with KASY-TV Licensee, LLC (“KASY”), KWBQ-TV, KRWB-TV and KASY-TV in the Albuquerque, Santa-Fe NM market. Under these agreements, we provide administrative services to these stations, have an obligation to reimburse certain of the stations' expenses, and we are compensated through a performance-based fee structure that provides us the benefit of certain returns from the operation of these stations. We determined that WBDT, Vaughan and KASY are VIEs and as a result of the JSAs and/or SSAs, we have variable interests in these entities. We are the primary beneficiary of these entities, and therefore, we consolidate these entities within our consolidated financial statements.

An order that the FCC adopted in March 2014, however, will require changes in our relationship with these entities going forward. In that order, the FCC concluded that JSAs should be “attributable” for purposes of the media ownership rules if they permit a television licensee to sell more than 15% of the commercial inventory of a television station owned by a third party in the same market. Stations with JSAs that would put them in violation of the new rules will have until June 19, 2016 to amend or terminate those arrangements unless they are able to obtain a waiver of such rules. Accordingly, absent further developments, we will be required to modify or terminate our existing JSAs by no later than June 19, 2016.

10

The carrying amounts and classifications of the assets and liabilities of the variable interest entities described above, which have been included in our consolidating balance sheets as of September 30, 2014 and December 31, 2013 are as follows (in thousands):

	September 30, 2014		December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	422	$	278
Accounts receivable, net		6,390		6,345
Other assets		847		927
Total current assets		7,659		7,550
Property and equipment, net		2,054		2,469
Broadcast licenses and other intangible assets, net		43,477		44,677
Other assets		1,017		1,360
Total assets	$	54,207	$	56,056
LIABILITIES
Current liabilities:
Current portion of long-term debt	$	1,162	$	1,162
Accounts payable		60		63
Accrued expenses		1,201		1,336
Program obligations		986		1,303
Total current liabilities		3,409		3,864
Long-term debt, excluding current portion		2,134		3,005
Program obligations		1,000		1,424
Other liabilities		47,664		47,763
Total liabilities	$	54,207	$	56,056

The assets of our consolidated VIEs can only be used to settle the obligations of the VIEs and may not be sold, or otherwise disposed of, except for assets sold or replaced with others of like kind or value. Other liabilities of $47.7 million and $47.8 million as of September 30, 2014 and December 31, 2013, respectively, serve to reduce the carrying value of the entities, and are eliminated in our consolidated financial statements. This reflects the fact that as of September 30, 2014 and December 31, 2013, we have an option that we may exercise if the FCC attribution rules change. The option would allow us to acquire the assets or member’s interest of the VIE entities for a nominal exercise price, which is significantly less than the carrying value of their tangible and intangible net assets. The options are carried at zero on our consolidated balance sheet, as any value attributable to the options is eliminated in the consolidation of the VIEs. In an order adopted in March 2014, the FCC concluded that JSAs should be "attributable" for purposes of the media ownership rules if they permit a television licensee to sell more than 15% of the commercial inventory of a television station owned by a third party in the same market. Stations with JSAs that would put them in violation of the new rules will have until June 19, 2016 to amend or terminate those arrangements, unless they are able to obtain a waiver of such rules. Accordingly, absent further developments, or the grant of waivers, we will be required to modify or terminate our existing JSAs no later than June 19, 2016.

Redeemable Noncontrolling Interest

The redeemable noncontrolling interest as of September 30, 2014 includes the interest of minority shareholders of HYFN and Dedicated Media. During the nine months ended September 30, 2014, we reclassified the interest of the minority shareholders of Nami Media, Inc. ("Nami Media") to permanent equity, as the mandatory redemption feature of Nami Media's minority shareholders' interest terminated in February 2014. In addition, during the third quarter of 2014, we adjusted the mandatory redeemable noncontrolling interest associated with Dedicated Media to equal $8.6 million, which represents our current estimate of the second stage purchase obligation for the minority shares of Dedicated Media. For further discussion, refer to Note 2 - "Acquisitions." The following table presents the activity of the redeemable noncontrolling interest included in our consolidated balance sheets, which represents third parties’ proportionate share of our consolidated net assets (in thousands):

	Redeemable Noncontrolling Interest
Balance as of December 31, 2013	$	12,845
Net loss		(542	)
Share-based compensation and other		16
Accretion of mandatory purchase obligation of Dedicated Media		4,971
Reclassification to permanent equity		(2,125	)
Balance as of September 30, 2014	$	15,165

11

During the third quarter of 2014, Nami Media ceased operations. As a result, we reorganized our digital operations and transferred certain operating assets of Nami Media to LIN Digital. As of September 30, 2014, there are no longer noncontrolling interests in Nami Media and we have transferred the balance of noncontrolling interest related to Nami Media to Class A common shares in our statement of shareholders' equity for the nine months ended September 30, 2014.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the notes thereto. Our actual results could differ from these estimates. Estimates are used for the allowance for doubtful accounts in receivables, valuation of goodwill and intangible assets, assumptions used to determine fair value of financial instruments, amortization and impairment of program rights and intangible assets, share-based compensation and other long-term incentive compensation arrangements, pension costs, barter transactions, income taxes, employee medical insurance claims, useful lives of property and equipment, contingencies, litigation and net assets of businesses acquired.

Cash and Cash Equivalents

We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") and the International Accounting Standards Board ("IASB") issued a converged standard on revenue recognition from contracts with customers, ASU 2014-09 (Topic 606 and IFRS 15). This standard will supersede nearly all existing revenue recognition guidance. ASU 2014-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. We are currently evaluating the impact this guidance will have on our financial condition, results of operations and cash flows.

In April 2014, the FASB issued Accounting Standard Update No. 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity" ("ASU 2014-08"). ASU 2014-08 changes the threshold for disclosing discontinued operations and the related disclosure requirements. Pursuant to ASU 2014-08, only disposals representing a strategic shift, such as a major line of business, a major geographical area or a major equity investment, should be presented as a discontinued operation. ASU 2014-08 is effective for annual periods beginning on or after December 15, 2014 with early adoption permitted but only for disposals or classifications as held for sale which have not been reported in financial statements previously issued or available for issuance. We have not yet adopted this new guidance and are currently evaluating the impact that it will have on our disclosures and consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, "Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." This ASU establishes specific guidance to an organization's management on their responsibility to evaluate whether there is substantial doubt about the organization's ability to continue as a going concern. We have not yet adopted this standard and are currently evaluating the impact that the new guidance will have on our disclosures and consolidated financial statements.

Note 2 - Acquisitions

Federated Media Publishing, Inc.

On February 3, 2014, LIN Digital Media LLC, a wholly owned subsidiary of LIN Television, acquired 100% of the capital stock of Federated Media Publishing, Inc., which we subsequently converted into a Delaware limited liability company ("Federated Media"). Federated Media is a digital content and conversational marketing company that leverages the relationships and content from its publishing network to deliver contextually relevant advertising and conversational and engagement tools that reach agencies’ and brands’ targeted audiences across digital and social media platforms. The purchase price totaled $22.5 million, net of cash, including post-closing adjustments, and was funded from cash on hand and amounts drawn on our revolving credit facility.

12

The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed by us in the acquisition (in thousands):

	Redeemable Noncontrolling Interest
Current assets	$	9,811
Property and equipment		72
Non-current assets		195
Other intangible assets		11,497
Goodwill		7,306
Current liabilities		(6,367	)
Total	$	22,514

The amount allocated to definite-lived intangible assets represents the estimated fair values of publisher relationships of $4.2 million, customer relationships of $1.2 million, completed technology of $3.9 million, and trademarks of $2.2 million. These intangible assets will be amortized over the estimated remaining useful lives of approximately 8 years for publisher relationships, 4 years for customer relationships, 3 years for completed technology and 7 years for trademarks.

Goodwill of $7.3 million is the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired, and primarily represents the benefits of the incremental revenue we expect to generate from the acquisition of Federated Media. All of the goodwill recognized in connection with the acquisition of Federated Media is deductible for tax purposes.

Net revenues and operating loss of Federated Media included in our consolidated statements of operations for the nine months ended September 30, 2014 were $17.1 million and $0.8 million, respectively.

Dedicated Media, Inc.

On April 9, 2013, we acquired a 60% interest (calculated on a fully diluted basis) in Dedicated Media, a multi-channel advertisement buying and optimization company. Under the terms of our agreement with Dedicated Media, we agreed to purchase the remaining outstanding shares of Dedicated Media by no later than February 15, 2015 if Dedicated Media achieves both (i) a target earnings before interest, taxes, depreciation and amortization (“EBITDA”) and (ii) a target gross profit in 2014, as outlined in the purchase agreement. The purchase price of these shares is based on multiples of Dedicated Media’s 2014 EBITDA and gross profit. As of September 30, 2014, we concluded it was probable that Dedicated Media would achieve at least the minimum levels of gross profit and adjusted EBITDA required to obligate LIN LLC to purchase the remaining outstanding shares of Dedicated Media. Based on management’s current projections of Dedicated Media’s 2014 gross profit and adjusted EBITDA, we estimate the purchase price for the remaining outstanding shares to be approximately $8.6 million and accordingly, we have adjusted the mandatory redeemable noncontrolling interest account for Dedicated Media to equal this estimated obligation and have recorded a corresponding decrease to equity on our statement of stockholder's equity for the nine months ended September 30, 2014. We believe the stage two purchase price of $8.6 million represents the fair value of the stage two shares to be acquired. This estimate is subject to change based on Dedicated Media’s actual results in 2014, which will be determined during the first quarter of 2015. Our maximum potential obligation under the purchase agreement is $26 million.

13

HYFN, Inc.

On April 4, 2013, we acquired a 50.1% interest (calculated on a fully diluted basis) in HYFN, a full service digital advertising agency specializing in the planning, development, deployment and support for websites, mobile sites, interactive banners, games and various applications for multiple devices. Under the terms of our agreement with HYFN, we agreed to purchase the remaining outstanding shares of HYFN by no later than February 15, 2016 if HYFN achieves both (i) a target EBITDA and (ii) target net revenues in 2015, as outlined in the transaction agreements. The purchase price of these shares is based on multiples of HYFN’s 2015 net revenue and EBITDA. Our maximum potential obligation under the terms of our agreement is approximately $62.4 million. If HYFN does not meet the target EBITDA or target net revenues in 2015, we have the option to purchase the remaining outstanding shares using the same purchase price multiple. As of September 30, 2014, we believe that achievement of the financial targets by HYFN is not yet probable and therefore, have not reflected this obligation in our consolidated financial statements.

Our obligations to purchase the noncontrolling interest holders’ shares of both Dedicated Media and HYFN are outside of our control, because they are based on the achievement of certain financial targets described above. Therefore, the noncontrolling interests related to Dedicated Media and HYFN as of September 30, 2014 has been reported as redeemable noncontrolling interest and classified as temporary equity on our consolidated balance sheets.

If we do not purchase the remaining outstanding shares of Dedicated Media or HYFN by the dates set forth in the respective purchase agreements, the noncontrolling interest holders have the right to purchase our interest. The purchase price of these shares is based on the same purchase price multiple described above and is exercisable only if the applicable financial targets are not met and we do not elect to purchase the remaining interest. The fair value of this option is zero and no amounts related to these options are included in our consolidated financial statements as of September 30, 2014.

Pro Forma Information

The following table sets forth unaudited pro forma results of operations for the nine months ended September 30, 2014 and 2013 assuming that the above acquisitions of Federated Media, Dedicated Media and HYFN, along with transactions necessary to finance the acquisitions, occurred on January 1, 2013 (in thousands):

	Nine Months Ended September 30, 2014			Nine Months Ended September 30, 2013
Net revenue	$	548,436		$	500,229
Net (loss) income	$	(14,818	)	$	144,688

This pro forma financial information is based on historical results of operations, adjusted for the allocation of the purchase price and other acquisition accounting adjustments, and is not necessarily indicative of what our results would have been had we operated the business since January 1, 2013. The pro forma adjustments for the nine months ended September 30, 2014 and 2013 reflect depreciation expense, amortization of intangibles related to the fair value adjustments of the assets acquired, additional interest expense related to the financing of the transaction and the related tax effects of the adjustments.

In connection with the acquisition of Federated Media, we and Federated Media incurred a combined total of $0.8 million of transaction related costs primarily related to legal and other professional services. These costs were not included in the 2014 pro forma amounts. The 2013 pro forma net income was adjusted to include these costs, as they are directly attributable to the acquisition of Federated Media.

14

Note 3 - Intangible Assets

Goodwill totaled $195.4 million and $203.5 million at September 30, 2014 and December 31, 2013, respectively. The change in the carrying amount of goodwill during the nine months ended September 30, 2014 was as follows (in thousands):

	Goodwill
Broadcast:
Balance as of December 31, 2013	$	185,237
Acquisitions		-
Impairment charge		(15,413	)
Balance as of September 30, 2014	$	169,824
Digital:
Balance as of December 31, 2013	$	18,291
Acquisitions		7,306
Balance as of September 30, 2014	$	25,597
Total:
Balance as of December 31, 2013	$	203,528
Acquisitions		7,306
Impairment charge		(15,413	)
Balance as of September 30, 2014	$	195,421

The following table summarizes the carrying amounts of intangible assets (in thousands):

	September 30, 2014					December 31, 2013
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Broadcast licenses	$	491,062	$	–		$	536,515	$	–
Intangible assets subject to amortization(1)		98,712		(53,982	)		85,966		(38,917	)
Total	$	589,774	$	(53,982	)	$	622,481	$	(38,917	)

(1) Intangible assets subject to amortization are amortized on a straight line basis and primarily include network affiliations, acquired customer and publisher relationships, completed technology, brand names, non-compete agreements, internal-use software, favorable operating leases, and retransmission consent agreements.

On August 11, 2014, CBS announced that it would not renew its network affiliation agreement related to WISH-TV in Indianapolis, Indiana when that agreement expires on December 31, 2014. This announcement prompted us to perform an interim impairment test of the broadcast licenses and goodwill associated with our Indianapolis market as of September 30, 2014.

We used the income approach to test our asset group and reporting unit for impairment as of September 30, 2014 and as a result, recorded an impairment charge in our Broadcast segment of $60.9 million during the third quarter 2014, resulting in a remaining balance of zero goodwill and $15.8 million attributable to the broadcast licenses in our Indianapolis market.

Note 4 - Debt

Debt consisted of the following (in thousands):

	September 30, 2014		December 31, 2013
Senior Secured Credit Facility:
Revolving credit loans	$	–	$	5,000
$100,370 and $118,750 Term loans, net of discount of $278 and $345 as September 30, 2014 and December 31, 2013, respectively		100,092		118,405
$286,128 and $314,200 Incremental term loans, net of discount of $1,431 and $1,684 as of September 30, 2014 and December 31, 2013, respectively		284,697		312,516
83/8% Senior Notes due 2018		200,000		200,000
63/8% Senior Notes due 2021		290,000		290,000
Capital lease obligations		14,228		14,604
Other debt Total debt		5,297		6,167
Total long-term debt		894,314		946,692
Less current portion		20,383		17,364
Total long-term debt	$	873,931	$	929,328

15

During the three and nine months ended September 30, 2014, we paid $38.6 million and $46.5 million, respectively, of principal on the term loans and incremental term loans related to mandatory quarterly and optional payments under our senior secured credit facility, respectively.

During the nine months ended September 30, 2014, we drew $45 million on our revolving credit facility to fund the acquisition of Federated Media as well as normal operating activities. We subsequently made payments against these borrowings, resulting in an outstanding balance on our revolving credit facility of zero as of September 30, 2014.

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

	September 30, 2014		December 31, 2013
Carrying amount	$	880,085	$	932,088
Fair value		891,194		956,255

Note 5 - Segment Reporting

During the first quarter of 2014, we began operating under two operating segments, which also represent our reportable segments, “Broadcast” and “Digital” that are disclosed separately from our corporate activities. Our Broadcast segment includes 43 television stations and seven digital channels that are either owned, operated or serviced by us in 23 U.S. markets, all of which are engaged principally in the sale of television advertising and digital advertising primarily related to our television station companion websites, and our Digital segment includes the operating results of the following digital companies; LIN Digital, LIN Mobile, HYFN, Dedicated Media, and Federated Media. Unallocated corporate expenses primarily include our costs to operate as a public company and to operate our corporate locations.

We use earnings before interest, taxes, depreciation and amortization, excluding non-recurring charges, restructuring charges, share-based compensation, loss or gain on sales of assets, and adjusting amortization of program rights to deduct cash paid for programming (“Adjusted EBITDA”) as the primary financial measure reported to the chief executive officer (the chief operating decision maker) for use in assessing our operating segments’ operating performance. We believe that this measure is useful to investors because it eliminates significant non-cash expenses and non-recurring charges and as a result, allows investors to better understand our operating segments’ performance. All adjustments to Adjusted EBITDA presented below to arrive at consolidated income before income taxes except for depreciation and amortization and cash paid for programming relate primarily to corporate activities. Cash paid for programming pertains only to our Broadcast segment. As a result, we have disclosed depreciation and amortization by segment, as this is the only adjustment to operating income that the chief executive officer reviews on a segment basis. We have retrospectively recast prior period disclosures to reflect this change in our reportable segments.

	Three Months Ended September 30,				Nine Months Ended September 30
	2014		2013		2014		2013
	(in thousands)
Net revenues:
Broadcast	$	159,733	$	143,594	$	457,029	$	419,054
Digital		32,330		19,516		90,040		49,394
Total net revenues	$	192,063	$	163,110	$	547,069	$	468,448

16

The following table is a reconciliation of Adjusted EBITDA to consolidated income before provision for income taxes:

	Three Months Ended September 30,						Nine Months Ended September 30
	2014			2013			2014			2013
	(in thousands)
Segment Adjusted EBITDA:
Broadcast	$	63,040		$	50,869		$	169,290		$	142,628
Digital		3,547			1,236			3,209			3,196
Total segment Adjusted EBITDA		66,587			52,105			172,499			145,824
Unallocated corporate Adjusted EBITDA		(6,093	)		(5,650	)		(18,615	)		(15,458	)
Less:
Depreciation		10,892			11,429			32,665			34,387
Amortization of intangible assets		3,788			5,886			15,065			17,038
Impairment of broadcast licenses and goodwill		60,867			-			60,867			-
Amortization of program rights		6,972			7,605			20,353			22,542
Share-based compensation		1,765			2,238			6,111			6,766
Non-recurring(1) and acquisition-related charges		1,830			3,257			8,314			8,268
Restructuring charge		1,084			468			1,084			2,991
Loss (gain) on sale of assets		42			(9	)		141			173
Add:
Cash payments for programming		6,660			7,922			20,444			23,994
Operating (loss) income		(20,086	)		23,503			29,728			62,195
Other expense:
Interest expense, net		14,231			13,976			42,631			42,275
Share of loss in equity investments	–			–				100			25
Other (income) expense, net		(768	)		2,055			(851	)		2,115
Total other expense, net		13,463			16,031			41,880			44,415
Consolidated (loss) income before provision for income taxes	$	(33,549	)	$	7,472		$	(12,152	)	$	17,780

(1) Non-recurring charges for the three and nine months ended September 30, 2014 primarily consist of expenses related to the Merger and non-recurring charges for the three and nine months ended September 30, 2013 primarily consist of expenses related to the 2013 LIN LLC Merger.

	Three Months Ended September 30,						Nine Months Ended September 30
	2014			2013			2014			2013
	(in thousands)
Operating (loss) income:
Broadcast	$	(11,098	)	$	35,235		$	67,051		$	95,933
Digital		801			9			(3,299	)		251
Unallocated corporate		(9,789	)		(11,741	)		(34,024	)		(33,989	)
Total operating (loss) income	$	(20,086	)	$	23,503		$	29,728		$	62,195

17

	Three Months Ended September 30,				Nine Months Ended September 30
	2014		2013		2014		2013
	(in thousands)
Depreciation and amortization:
Broadcast	$	12,176	$	15,938	$	40,530	$	48,048
Digital		1,927		1,206		5,683		2,883
Unallocated corporate		577		171		1,517		494
Total depreciation and amortization	$	14,680	$	17,315	$	47,730	$	51,425

	Three Months Ended September 30,				Nine Months Ended September 30
	2014		2013		2014		2013
	(in thousands)
Capital expenditures:
Broadcast	$	3,906	$	5,359	$	12,211	$	16,728
Digital		1,261		1,353		3,647		3,036
Unallocated corporate Total capital expenditures		436		789		1,208		1,907
	$	5,603	$	7,501	$	17,066	$	21,671

	September 30, 2014		December 31, 2014
	(in thousands)
Assets:
Broadcast	$	1,012,135	$	1,100,343
Digital		94,608		69,690
Unallocated corporate Total assets		56,331		46,917
	$	1,163,074	$	1,216,950

Note 6 - Retirement Plans

The following table shows the components of the net periodic pension cost and the contributions to our 401(k) Plan and the retirement plans (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30
	2014			2013			2014			2013
	(in thousands)
Net periodic cost:
Interest cost	$	1,509		$	1,314		$	4,528		$	3,942
Expected return on plan assets		(1,771	)		(1,670	)		(5,311	)		(5,010	)
Amortization of net loss		284			428			853			1,284
Net periodic cost Contributions:	$	22		$	72		$	70		$	216
Contributions:
401(k) Plan	$	1,134		$	1,229		$	3,279		$	3,653
Defined contribution retirement plans		54			59			126			143
Defined benefit retirement plans Total contributions		2,584			1,231			5,264			3,944
Total contributions	$	3,772		$	2,519		$	8,669		$	7,740

See Note 10 - “Retirement Plans” in Item 15 of our 10-K for a full description of our retirement plans.

Note 7 - Restructuring

As of December 31, 2013, we had a restructuring accrual of $0.4 million related to severance and related costs as a result of the integration of the television stations acquired during 2012 as well as severance and related costs at some of our digital companies. During the three and nine months ended September 30, 2014, we recorded a restructuring charge of $1.1 million for severance and related costs at our stations and digital operations. During the three and nine months, we made cash payments of $0.7 million and $1 million, respectively, related to these restructuring actions. We expect to make cash payments of approximately $0.5 million during the remainder of the year with respect to such transactions.

18

The activity for these restructuring actions is as follows (in thousands):

	Severance and Related
Assets:
Balance as of December 31, 2013	$	423
Charges		1,084
Payments		(965	)
Balance as of September 30, 2014	$	542

Note 8 - Income Taxes

We recorded a benefit from income taxes of $8 million and a provision for income taxes of $0.8 million for the three and nine months ended September 30, 2014, respectively, compared to a benefit from income taxes of $139.3 million and $135.2 million for the three and nine months ended September 30, 2013, respectively. The benefit from income taxes for the three months ended September 30, 2014 was primarily a result of an $18.4 million discrete tax benefit recognized as a result of the impairment charge recorded during the third quarter of 2014 related to the carrying value of the broadcast licenses and goodwill in our Indianapolis market whereas, the provision for income taxes for the nine months ended September 30, 2014 was primarily a result of our income from operations before tax. The benefit from income taxes for the three and nine months ended September 30, 2013 was primarily a result of a $124.6 million discrete tax benefit recognized as a result of the 2013 LIN LLC Merger as well as an $18.2 million discrete tax benefit recognized as a result of the reversal of a state valuation allowance during the third quarter of 2013. Our effective income tax rate was (6.7)% and (760.1)% for the nine months ended September 30, 2014 and September 30, 2013, respectively. The change in the effective income tax rate was primarily a result of the discrete tax benefit recognized during the third quarter 2013 as a result of the 2013 LIN LLC Merger and the reversal of a state valuation allowance during the third quarter of 2013. We expect our effective income tax rate to range between 40% and 42% during the remainder of 2014.

During the first quarter of 2013, approximately $162.8 million of short term deferred tax liabilities were reclassified to income taxes payable upon the consummation of the JV Sale Transaction. As a result of the close of the 2013 LIN LLC Merger on July 30, 2013, $131.5 million of this tax liability was extinguished, resulting in a remaining tax liability of approximately $31.3 million associated with the JV Sale Transaction. We made state and federal tax payments to settle this liability during the fourth quarter of 2013. For further discussion regarding the income tax effects of the JV Sale Transaction and the 2013 LIN LLC Merger, see Note 1 - “Basis of Presentation and Summary of Significant Accounting Policies” and Note 13 - “Commitments and Contingencies” to our consolidated financial statements in our 10-K.

Note 9 - Commitments and Contingencies

We lease land, buildings, vehicles and equipment pursuant to non-cancelable operating lease agreements and we contract for general services pursuant to non-cancelable operating agreements that expire at various dates through 2036. In addition, we have entered into commitments for future syndicated entertainment and sports programming. Future payments for these non-cancelable operating leases and agreements, and future payments associated with syndicated television programs as of September 30, 2014 are as follows (in thousands):

Commitments

Year	Operating Leases and Agreements		Syndicated Television Programming			Total
2014	$	12,100	$	7,118	(1)	$	19,218
2015		62,443		28,201			90,644
2016		54,624		19,714			74,338
2017		64,320		4,882			69,202
2018		59,451		277			59,728
Thereafter		104,985		214			105,199
Total obligations	$	357,923	$	60,406		$	418,329

(1) Includes $10.4 million of program obligations recorded on our consolidated balance sheet as of September 30, 2014.

19

Contingencies

GECC Guarantee and the 2013 LIN LLC Merger

As further described in Note 1 - "Basis of Presentation and Summary of Significant Accounting Policies," pursuant to the JV Sale Transaction, LIN Television made a $100 million capital contribution to SVH and in turn, was released from the GECC Guarantee as well as any further obligations related to any shortfall funding agreements between LIN Television and SVH.

In February 2013, we entered into a $60 million Incremental Facility and utilized $40 million of cash on hand and borrowings under our revolving credit facility to fund the $100 million payment.

As a result of the JV Sale Transaction, after utilizing all of our available Federal net operating loss (“NOL”) carryforwards, we had an approximate $162.8 million income tax payable remaining, $131.5 million of which was extinguished as a result of the 2013 LIN LLC Merger. We made state and federal tax payments to settle the remaining liability of $31.3 million during the fourth quarter of 2013.

For further discussion of the GECC Guarantee and the 2013 LIN LLC Merger, refer to Note 13 - "Commitments and Contingencies" to our consolidated financial statements in our 10-K.

The Merger

We expect to incur approximately $1.5 - $2.5 million of legal and professional fees associated with the Merger and related financing during the fourth quarter of 2014. Contingent upon the consummation of the Merger and dependent upon the price of Media General's Class A common stock on the date of consummation, we will incur an advisory fee payable to J.P. Morgan Securities LLC, which we expect will be funded from the proceeds of Media General’s transaction financing. Based on the price of Media General's Class A common stock as of November 7, 2014, this advisory fee is estimated to be approximately $19.7 million, of which $1.5 million has already been paid. This advisory fee is contingent upon the consummation of the Merger and is not earned by JP Morgan until the Merger occurs. As of the date of this report, the necessary approval has not been obtained from the FCC and as a result, there is no assurance that the Merger and the corresponding advisory fee to be paid to JP Morgan will occur. As a result we do not deem the payment of the advisory fee to be probable and accordingly, did not record an obligation for this amount as of September 30, 2014.

Litigation

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

20

Following the announcement on March 21, 2014 of the execution of the Merger Agreement, three complaints were filed in the Delaware Court of Chancery challenging the proposed acquisition of LIN LLC: Sciabacucchi v. Lin Media LLC, et al. (C.A. No. 9530) (the “Sciabacucchi Action”), International Union of Operating Engineers Local 132 Pension Fund v. Lin Media LLC, et al. (C.A. No.9538) (the “Pension Fund Action”), and Pryor v. Lin Media LLC, et al. (C.A. No. 9577) (the “Pryor Action”). The litigations are putative class actions filed on behalf of the public stockholders of LIN LLC and name as defendants LIN LLC, our directors, Media General, New Holdco, Merger Sub 1 and Merger Sub 2 and HM Capital Partners LLC and several of its alleged affiliates (Hicks, Muse, Tate & Furst Equity Fund III, L.P.; HM3 Coinvestors, L.P.; Hicks, Muse, Tate & Furst Equity Fund IV, L.P.; Hicks, Muse, Tate & Furst Private Equity Fund IV, L.P.; HM4EQ Coinvestors, L.P.; Hicks, Muse & Co. Partners, L.P.; Muse Family Enterprises, Ltd.; and JRM Interim Investors, L.P. (together with HM Capital Partners LLC and individual director defendant John R. Muse, which we collectively refer to as “HMC”)).

On April 18, 2014, the plaintiff in the Pension Fund Action voluntarily dismissed that action without prejudice and, on April 21, 2014, the Court approved the dismissal.

On April 25, 2014, the plaintiff in the Sciabacucchi Action filed an amended complaint, and the plaintiffs in the Sciabacucchi and Pryor Actions each filed a motion for an expedited hearing on the plaintiff’s (yet-to-be filed) motion for a permanent injunction to enjoin the Merger, requesting, among other things, that the Court set a permanent injunction hearing for September 2014. On April 30, 2014, the plaintiffs in the Sciabacucchi and Pryor Actions filed a stipulation to consolidate the two actions, which was approved by the Court on May 1, 2014.

The operative complaint generally alleges that the individual defendants breached their fiduciary duties in connection with their consideration and approval of the Merger, that the entity defendants aided and abetted those breaches and that individual director defendant Royal W. Carson III and HMC breached their fiduciary duties as controlling shareholders of LIN LLC by causing LIN LLC to enter into the Merger, which plaintiffs allege will provide disparate consideration to HMC. The complaint seeks, among other things, declaratory and injunctive relief enjoining the Merger.

On May 15, 2014, plaintiffs in the consolidated action sent a letter to the Court withdrawing the pending motion to expedite.

The outcome of the lawsuit is uncertain and cannot be predicted with any certainty. An adverse judgment for monetary damages could have a material adverse effect on our operations and liquidity. An adverse judgment granting permanent injunctive relief could indefinitely enjoin completion of the Merger.

On October 3, 2014, LIN LLC received an appraisal rights notice from Cede & Co., the nominee of The Depository Trust Company, and purported holder of 44,585 LIN LLC common shares. Pursuant to the Merger Agreement and limited liability company agreement of LIN LLC, holders of LIN LLC common shares are entitled to demand appraisal and shall be entitled to payment from LIN LLC, after consummation of the Merger, of the fair value of the holder’s dissenting shares; provided, that the holder of such shares takes all required actions under applicable law to properly demand appraisal. The outcome of this appraisal notice cannot be predicted with any certainty at this time.

21

Note 10 — Condensed Consolidating Financial Statements

LIN Television, a 100% owned subsidiary of LIN LLC, is the primary obligor of our senior secured credit facility, our 8³ /8 % Senior Notes and our 6³ /8 % Senior Notes, which are further described in Note 4 — “Debt”.  LIN LLC fully and unconditionally guarantees all of LIN Television’s debt on a joint-and-several basis.  Additionally, all of the consolidated 100% owned subsidiaries of LIN Television fully and unconditionally guarantee LIN Television’s senior secured credit facility, our 8³ /8 % Senior Notes and our 6³ /8 % Senior Notes on a joint-and-several basis, subject to customary release provisions.  There are certain contractual restrictions on LIN Television’s ability to obtain funds in the form of dividends or loans from the non-guarantor subsidiaries.

The following condensed consolidating financial statements present the consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income and consolidated statements of cash flows of, LIN Television, as the issuer, the guarantor subsidiaries, and the non-guarantor subsidiaries of LIN Television and the elimination entries necessary to consolidate or combine the issuer with the guarantor and non-guarantor subsidiaries.  These statements are presented in accordance with the disclosure requirements under SEC Regulation S-X Rule 3-10.

22

Condensed Consolidating Balance Sheet

As of September 30, 2014

(in thousands)

	LIN Television Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	19,066	$	1,150	$	1,028	$	—		$	21,244
Marketable securities		174		—		—		—			174
Accounts receivable, net		79,511		43,208		22,652		—			145,371
Deferred income tax assets		3,492		1,864		40		—			5,396
Other current assets		14,963		2,518		1,615		—			19,096
Total current assets		117,206		48,740		25,335		—			191,281
Property and equipment, net		173,197		38,630		2,551		—			214,378
Deferred financing costs		14,002		—		73		—			14,075
Goodwill		154,079		30,328		11,014		—			195,421
Broadcast licenses		—		448,361		42,701		—			491,062
Other intangible assets, net		22,083		14,389		8,258		—			44,730
Advances to consolidated subsidiaries		8,606		932,266		—		(940,872	)		—
Investment in consolidated subsidiaries		1,470,786		—		—		(1,470,786	)		—
Other assets		52,569		3,051		951		(44,444	)		12,127
Total assets	$	2,012,528	$	1,515,765	$	90,883	$	(2,456,102	)	$	1,163,074
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	19,137	$	—	$	1,246	$	—		$	20,383
Accounts payable		5,473		7,157		2,855		—			15,485
Income taxes payable		15		243		—		—			258
Accrued expenses		50,389		10,501		3,307		—			64,197
Program obligations		5,334		1,108		986		—			7,428
Total current liabilities		80,348		19,009		8,394		—			107,751
Long-term debt, excluding current portion		871,759		—		2,172		—			873,931
Deferred income tax liabilities		13,844		36,209		659		—			50,712
Program obligations		1,815		126		1,000		—			2,941
Intercompany liabilities		932,264		—		8,606		(940,870	)		—
Other liabilities		21,217		77		44,444		(44,444	)		21,294
Total liabilities		1,921,247		55,421		65,275		(985,314	)		1,056,629
Redeemable noncontrolling interest		—		—		15,165		—			15,165
											—
Total shareholders’ equity (deficit)		91,281		1,460,344		10,443		(1,470,788	)		91,280
Total liabilities, redeemable noncontrolling interest and shareholders’ equity (deficit)	$	2,012,528	$	1,515,765	$	90,883	$	(2,456,102	)	$	1,163,074

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Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2014

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
Net revenues	$	118,815		$	60,190		$	19,197	$	(6,139	)	$	192,063
Operating expenses:
Direct operating		40,855			26,034			12,346		(3,206	)		76,029
Selling, general and administrative		28,321			12,740			3,411		(166	)		44,306
Amortization of program rights		5,194			1,432			346		—			6,972
Corporate		7,583			50			544		(8	)		8,169
Depreciation		8,957			1,685			250		—			10,892
Amortization of intangible assets		2,091			931			766		—			3,788
Impairment of broadcast licenses and goodwill		15,414			45,453			—		—			60,867
Restructuring charge		846			238			—		—			1,084
Loss (gain) from asset dispositions		43			(2	)		1		—			42
Operating (loss) income		9,511			(28,371	)		1,533		(2,759	)		(20,086	)
Other (income) expense:
Interest expense, net		14,185			(1	)		47		—			14,231
Intercompany fees and expenses		7,456			(7,606	)		150		—			—
Other, net		(37	)		(731	)		—		—			(768	)
Total other (income) expense, net		21,604			(8,338	)		197		—			13,463
(Loss) income before (benefit from) provision for income taxes		(12,093	)		(20,033	)		1,336		(2,759	)		(33,549	)
(Benefit from) provision for income taxes		(204	)		(8,013	)		221		—			(7,996	)
Net (loss) income		(11,889	)		(12,020	)		1,115		(2,759	)		(25,553	)
Equity in (loss) income from operations of consolidated subsidiaries		(14,181	)		—			—		14,181			—
Net (loss) income		(26,070	)		(12,020	)		1,115		11,422			(25,553	)
Net income attributable to noncontrolling interests		—			—			517		—			517
Net (loss) income attributable to LIN Television Corporation	$	(26,070	)	$	(12,020	)	$	598	$	11,422		$	(26,070	)

24

Condensed Consolidating Statement of Comprehensive Loss

For the Three Months Ended September 30, 2014

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating/ Eliminating Adjustments		LIN Television Corporation Consolidated
Net (loss) income	$	(26,070	)	$	(12,020	)	$	1,115	$	11,422	$	(25,553	)
Amortization of pension net losses, net of tax of $113		172			—			—		—		172
Comprehensive (loss) income		(25,898	)		(12,020	)		1,115		11,422		(25,381	)
Comprehensive income attributable to noncontrolling interest		—			—			517		—		517
Comprehensive (loss) income attributable to LIN Television Corporation	$	(25,898	)	$	(12,020	)	$	598	$	11,422	$	(25,898	)

25

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2014

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
Net revenues	$	338,293		$	172,454		$	54,597		$	(18,275	)	$	547,069
Operating expenses:
Direct operating		119,514			76,002			34,757			(9,323	)		220,950
Selling, general and administrative		85,825			38,582			13,821			(674	)		137,554
Amortization of program rights		14,919			4,236			1,198			—			20,353
Corporate		27,992			134			544			(8	)		28,662
Depreciation		26,780			4,999			886			—			32,665
Amortization of intangible assets		9,220			2,409			3,436			—			15,065
Impairment of broadcast licenses and goodwill		15,414			45,453			—			—			60,867
Restructuring charge		846			238			—			—			1,084
Loss (gain) from asset dispositions		19			133			(11	)		—			141
Operating (loss) income		37,764			268			(34	)		(8,270	)		29,728
Other (income) expense:
Interest expense, net		42,494			(1	)		138			—			42,631
Share of loss in equity investments		100			—			—			—			100
Intercompany fees and expenses		22,731			(23,155	)		424			—			—
Other, net		(131	)		(720	)		—			—			(851	)
Total other (income) expense, net		65,194			(23,876	)		562			—			41,880
(Loss) income before (benefit from) provision for income taxes		(27,430	)		24,144			(596	)		(8,270	)		(12,152	)
(Benefit from) provision for income taxes		(8,614	)		9,658			(231	)		—			813
Net (loss) income		(18,816	)		14,486			(365	)		(8,270	)		(12,965	)
Equity in (loss) income from operations of consolidated subsidiaries		6,393			—			—			(6,393	)		—
Net (loss) income		(12,423	)		14,486			(365	)		(14,663	)		(12,965	)
Net income (loss) attributable to noncontrolling interests		—			—			(542	)		—			(542	)
Net (loss) income attributable to LIN Television Corporation	$	(12,423	)	$	14,486		$	177		$	(14,663	)	$	(12,423	)

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Condensed Consolidating Statement of Comprehensive Loss

For the Nine Months Ended September 30, 2014

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
Net (loss) income	$	(12,423	)	$	14,486	$	(365	)	$	(14,663	)	$	(12,965	)
Amortization of pension net losses, net of tax of $338		517			—		—			—			517
Comprehensive (loss) income		(11,906	)		14,486		(365	)		(14,663	)		(12,448	)
Comprehensive income (loss) attributable to noncontrolling interest		—			—		(542	)		—			(542	)
Comprehensive (loss) income attributable to LIN Television Corporation	$	(11,906	)	$	14,486	$	177		$	(14,663	)	$	(11,906	)

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Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2014

(in thousands)

	LIN Television Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating/ Eliminating Adjustments			LIN Television Corporation Consolidated
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities	$	86,790		$	27,913		$	(3,228	)	$	—		$	111,475
INVESTING ACTIVITIES:
Capital expenditures		(12,113	)		(3,610	)		(1,343	)		—			(17,066	)
Acquisition of broadcast towers		(7,257	)		—			—			—			(7,257	)
Payments for business combinations, net of cash acquired		(24,825	)		—			—			—			(24,825	)
Proceeds from the sale of assets		112			2			—			—			114
Contributions to equity investments		(100	)		—			—			—			(100	)
Marketable securities		(174	)		—			—			—			(174	)
Receipt of dividend		58,508			—			—			(58,508	)		—
Advances on intercompany borrowings		(4,329	)		—			—			4,329			—
Payments from intercompany borrowings		—			35,350			—			(35,350	)		—
Net cash provided by (used in) investing activities		9,822			31,742			(1,343	)		(89,529	)		(49,308	)
FINANCING ACTIVITIES:
Net proceeds on exercises of employee and director share-based compensation		—			—			—			—			—
Proceeds from borrowings on long-term debt		45,000			—			—			—			45,000
Principal payments on long-term debt		(96,759	)		—			(939	)		—			(97,698	)
Payment of dividend		(750	)		(58,508	)		—			58,508			(750	)
Proceeds from intercompany borrowings		—			—			4,329			(4,329	)		—
Payments on intercompany borrowings		(35,350	)		—			—			35,350			—
Net cash provided by (used in)financing activities		(87,859	)		(58,508	)		3,390			89,529			(53,448	)
Net increase (decrease) in cash and cash equivalents		8,753			1,147			(1,181	)		—			8,719
Cash and cash equivalents at the beginning of the period		10,313			3			2,209			—			12,525
Cash and cash equivalents at the end of the period	$	19,066		$	1,150		$	1,028		$	—		$	21,244

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