As filed with the Securities and Exchange Commission on June 12, 2014
File No. 001-36230
 
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

Amendment No. 3
to
FORM 10
GENERAL FORM FOR REGISTRATION OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF
THE SECURITIES EXCHANGE ACT OF 1934

TRIBUNE PUBLISHING COMPANY
(Exact Name of Registrant as Specified in its Charter)

Delaware
(State or Other Jurisdiction of
Incorporation or Organization)	 	38-3919441
(I.R.S. Employer
Identification No.)	
		
435 North Michigan Avenue
Chicago, Illinois
(Address of Principal Executive Offices)	 	60611
(Zip Code)	
 
312-222-9100
(Registrant’s Telephone Number, Including Area Code)

Securities to be registered pursuant to section 12(b) of the Act:

Title of each class
                                 to be so registered                                	 	Name of each exchange on which
                    each class is to be registered                    	
Common Stock, par value $0.01 per share	 	New York Stock Exchange	
Securities to be registered pursuant to Section 12(g) of the Act:
None

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

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

TRIBUNE PUBLISHING COMPANY
INFORMATION REQUIRED IN REGISTRATION STATEMENT
CROSS-REFERENCE SHEET BETWEEN INFORMATION STATEMENT AND ITEMS OF FORM 10
Certain information required to be included in this Form 10 is incorporated by reference to specifically-identified portions of the body of the information statement filed herewith as Exhibit 99.1 (the “information statement”). None of the information contained in the information statement shall be incorporated by reference herein or deemed to be a part hereof unless such information is specifically incorporated by reference.
 
Item 1 .	Business.	
The information required by this item is contained under the sections of the information statement entitled “Information Statement Summary,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business.” Those sections are incorporated herein by reference.
 
Item 1A.	Risk Factors.	
The information required by this item is contained under the sections of the information statement entitled “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements.” Those sections are incorporated herein by reference.
 
Item 2.	Financial Information.	
The information required by this item is contained under the sections of the information statement entitled “Information Statement Summary,” “Financing Arrangements,” “Unaudited Pro Forma Combined Financial Statements,” “Selected Combined Historical Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Those sections are incorporated herein by reference.
 
Item 3.	Properties.	
The information required by this item is contained under the section of the information statement entitled “Business—Properties.” That section is incorporated herein by reference.
 
Item 4.	Security Ownership of Certain Beneficial Owners and Management.	
The information required by this item is contained under the section of the information statement entitled “Security Ownership of Certain Beneficial Owners and Management.” That section is incorporated herein by reference.
 
Item 5.	Directors and Executive Officers.	
The information required by this item is contained under the section of the information statement entitled “Management.” That section is incorporated herein by reference.
 
Item 6.	Executive Compensation.	
The information required by this item is contained under the sections of the information statement entitled “Management,” “Executive Compensation” and “Director Compensation.” Those sections are incorporated herein by reference.

Item 7.	Certain Relationships and Related Transactions, and Director Independence.	
The information required by this item is contained under the sections of the information statement entitled “Relationships between Tribune and Tribune Publishing following the Distribution,” “Management” and “Certain Relationships and Related Transactions.” Those sections are incorporated herein by reference.
 
Item 8.	Legal Proceedings.	
The information required by this item is contained under the section of the information statement entitled “Business—Legal Proceedings.” That section is incorporated herein by reference.
 
Item 9.	Market Price of and Dividends on the Registrant’s Common Equity and Related Stockholder Matters.	
The information required by this item is contained under the sections of the information statement entitled “Information Statement Summary,” “The Distribution—Trading Prior to the Distribution Date” and “—Listing and Trading of Shares of Tribune Publishing Common Stock,” “Security Ownership of Certain Beneficial Owners and Management,” “Executive Compensation” and “Dividend Policy.” Those sections are incorporated herein by reference.
 
Item 10.	Recent Sales of Unregistered Securities.	
The information required by this item is contained under the section of the information statement entitled “Description of Capital Stock—Sales of Unregistered Securities.” That section is incorporated herein by reference.
 
Item 11.	Description of Registrant’s Securities to be Registered.	
The information required by this item is contained under the section of the information statement entitled “Description of Capital Stock.” That section is incorporated herein by reference.
 
Item 12.	Indemnification of Directors and Officers.	
The information required by this item is contained under the section of the information statement entitled “Description of Capital Stock—Limitation of Liability and Indemnification of Officers and Directors.” That section is incorporated herein by reference.
 
Item 13.	Financial Statements and Supplementary Data.	
The information required by this item is contained under the sections of the information statement entitled “Information Statement Summary,” “Unaudited Pro Forma Combined Financial Statements,” “Selected Historical Combined Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Index to Financial Statements” (and the financial statements referenced therein). Those sections are incorporated herein by reference.
 
Item 14.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.	
Not applicable
 
Item 15.	Financial Statements and Exhibits.	
 
 	(a)	Financial Statements.	

The information required by this item is contained under the section of the information statement entitled “Index to Financial Statements” (and the financial statements referenced therein). That section is incorporated herein by reference.
 
 	(b)	Exhibits. The following documents are filed as exhibits hereto:	

EXHIBIT
NUMBER	 	 	
		
2.1	 	  –   Form of Separation and Distribution Agreement.	
		
3.1	 	  –   Form of Amended and Restated Certificate of Incorporation of Tribune Publishing Company.	
		
3.2	 	  –   Form of Amended and Restated By-laws of Tribune Publishing Company.	
		
10.1	 	  –   Form of Transition Services Agreement.	
		
10.2	 	  –   Form of Tax Matters Agreement.	
		
10.3*	 	  –   Form of Employee Matters Agreement.	
		
10.4	 	  –   Form of Registration Rights Agreement.	
		
10.5* §	 	  –   Tribune Publishing Company 2014 Omnibus Incentive Plan.	
		
10.6 §	 	  –   Form of Stock Option Award Agreement.	
		
10.7 §	 	  –   Form of Restricted Stock Unit Award Agreement.	
		
10.8* §	 	  –   Employment Agreement, dated March 3, 2014, between Tribune Publishing Company, LLC        and John H. Griffin, Jr.	
		
10.9* §	 	  –   Employment Agreement, dated September 11, 2013, between Tribune Publishing Company,        LLC and John Bode.	
		
21.1	 	  –   List of Subsidiaries.	
		
99.1	 	  –   Preliminary Information Statement.	

*	Previously filed.	
§	Constitutes a compensatory plan or arrangement required to be filed with this registration statement.	

SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.

	 		 	TRIBUNE PUBLISHING COMPANY	
					
Date: June 12, 2014	 		 	By:	 	 	 	/s/ Steven Berns	
	 		 	Name:	 	Steven Berns	
	 		 	Title:	 	President and Chief Executive Officer	

EXHIBIT INDEX

EXHIBIT
NUMBER	 	 	
		
2.1	 	  –   Form of Separation and Distribution Agreement.	
		
3.1	 	  –   Form of Amended and Restated Certificate of Incorporation of Tribune Publishing Company.	
		
3.2	 	  –   Form of Amended and Restated By-laws of Tribune Publishing Company.	
		
10.1	 	  –   Form of Transition Services Agreement.	
		
10.2	 	  –   Form of Tax Matters Agreement.	
		
10.3*	 	  –   Form of Employee Matters Agreement.	
		
10.4	 	  –   Form of Registration Rights Agreement.	
		
10.5* §	 	  –   Tribune Publishing Company 2014 Omnibus Incentive Plan.	
		
10.6 §	 	  –   Form of Stock Option Award Agreement.	
		
10.7 §	 	  –   Form of Restricted Stock Unit Award Agreement.	
		
10.8* §	 	  –   Employment Agreement, dated March 3, 2014, between Tribune Publishing Company, LLC        and John H. Griffin, Jr.	
		
10.9* §	 	  –   Employment Agreement, dated September 11, 2013, between Tribune Publishing Company,        LLC and John Bode.	
		
21.1	 	  –   List of Subsidiaries.	
		
99.1	 	  –   Preliminary Information Statement.	

*	Previously filed.	
§	Constitutes a compensatory plan or arrangement required to be filed with this registration statement.	

Exhibit 2.1

 
SEPARATION AND DISTRIBUTION AGREEMENT
by and between
TRIBUNE COMPANY
and
TRIBUNE PUBLISHING COMPANY
Dated as of [            ], 2014

 

TABLE OF CONTENTS

 	 	 	  	Page	 	
	
ARTICLE I	  	
	
DEFINITIONS AND INTERPRETATION	  	
			
Section 1.1	 	Certain Defined Terms	  	 	2	  	
	
ARTICLE II	  	
	
THE BUSINESS SEPARATION	  	
			
Section 2.1	 	Business Separation	  	 	17	  	
Section 2.2	 	Intercompany Arrangements	  	 	18	  	
Section 2.3	 	Resignation	  	 	19	  	
	
ARTICLE III	  	
	
CONDITIONS TO DISTRIBUTION	  	
			
Section 3.1	 	Sole Discretion of Distributing	  	 	19	  	
Section 3.2	 	Other Conditions to Distribution	  	 	20	  	
	
ARTICLE IV	  	
	
DISTRIBUTION	  	
			
Section 4.1	 	Distribution	  	 	21	  	
	
ARTICLE V	  	
	
GENERAL PROVISIONS	  	
			
Section 5.1	 	Implementation Documents	  	 	22	  	
Section 5.2	 	Unreleased Liabilities	  	 	22	  	
Section 5.3	 	Deferred Transfers	  	 	22	  	
Section 5.4	 	Transfers of Assets or Liabilities Following the Distribution	  	 	24	  	
Section 5.5	 	Intellectual Property	  	 	24	  	
Section 5.6	 	Certain Matters Governed Exclusively by Ancillary Agreements	  	 	24	  	
Section 5.7	 	Disclaimer of Representations and Warranties	  	 	25	  	
Section 5.8	 	Director and Officer Indemnification	  	 	26	  	
Section 5.9	 	Letters of Credit	  	 	26	  	
Section 5.10	 	Affiliate Agreement	  	 	26	  	
	
ARTICLE VI	  	
	
CONFIDENTIALITY; EXCHANGE OF INFORMATION	  	
			
Section 6.1	 	Agreement for Exchange of Information; Archives	  	 	27	  	
Section 6.2	 	Ownership of Information	  	 	28	  	
 
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TABLE OF CONTENTS
(cont’d)

Section 6.3	 	Record Retention	  	 	28	  	
Section 6.4	 	Production of Witnesses; Records; Cooperation	  	 	28	  	
Section 6.5	 	Confidential Information	  	 	29	  	
Section 6.6	 	Protective Arrangement	  	 	30	  	
Section 6.7	 	Other Agreements Providing for Exchange of Information	  	 	30	  	
Section 6.8	 	Privileged Matters	  	 	30	  	
	
 ARTICLE VII	  	
	
FINANCIAL AND OTHER INFORMATION	  	
			
Section 7.1	 	Financial and Other Information	  	 	33	  	
Section 7.2	 	Sarbanes-Oxley Section 404 Compliance	  	 	35	  	
	
ARTICLE VIII	  	
	
INSURANCE	  	
			
Section 8.1	 	Insurance Matters	  	 	36	  	
Section 8.2	 	Miscellaneous	  	 	37	  	
	
ARTICLE IX	  	
	
LEGAL MATTERS	  	
			
Section 9.1	 	Control of Legal Matters	  	 	38	  	
Section 9.2	 	Notice to Third Parties; Service of Process; Cooperation	  	 	38	  	
Section 9.3	 	Bankruptcy Proceedings	  	 	39	  	
	
ARTICLE X	  	
	
INDEMNIFICATION	  	
			
Section 10.1	 	Release of Pre-Separation Claims	  	 	39	  	
Section 10.2	 	Indemnification by Publishing	  	 	41	  	
Section 10.3	 	Indemnification by Distributing	  	 	42	  	
Section 10.4	 	Indemnification with respect to Unreleased Liabilities	  	 	43	  	
Section 10.5	 	Indemnification Obligations Net of Third Party Proceeds and Other Amounts	  	 	43	  	
Section 10.6	 	Contribution	  	 	44	  	
Section 10.7	 	Procedures for Indemnification of Direct Claims	  	 	44	  	
Section 10.8	 	Procedures for Indemnification of Third Party Claims	  	 	45	  	
Section 10.9	 	Remedies Cumulative	  	 	46	  	
Section 10.10	 	Tax Matters	  	 	46	  	
Section 10.11	 	Survival of Indemnities	  	 	46	  	
 
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TABLE OF CONTENTS
(cont’d)

	
ARTICLE XI	  	
	
DISPUTE RESOLUTION	  	
			
Section 11.1	 	Disputes	  	 	47	  	
Section 11.2	 	Dispute Resolution	  	 	47	  	
Section 11.3	 	Mediation of Unresolved Disputes	  	 	47	  	
Section 11.4	 	Continuity of Service and Performance	  	 	48	  	
	
ARTICLE XII	  	
	
FURTHER ASSURANCES	  	
			
Section 12.1	 	Further Assurances	  	 	48	  	
	
ARTICLE XIII	  	
	
AMENDMENT AND TERMINATION	  	
			
Section 13.1	 	Amendment and Termination	  	 	48	  	
Section 13.2	 	Effect of Termination	  	 	49	  	
	
ARTICLE XIV	  	
	
MISCELLANEOUS	  	
			
Section 14.1	 	LIMITATION OF LIABILITY	  	 	49	  	
Section 14.2	 	Expenses	  	 	49	  	
Section 14.3	 	Counterparts	  	 	49	  	
Section 14.4	 	Notices	  	 	50	  	
Section 14.5	 	Public Announcements	  	 	50	  	
Section 14.6	 	Severability	  	 	50	  	
Section 14.7	 	Entire Agreement	  	 	51	  	
Section 14.8	 	Assignment	  	 	51	  	
Section 14.9	 	Third Party Beneficiaries	  	 	51	  	
Section 14.10	 	Governing Law; Jurisdiction	  	 	51	  	
Section 14.11	 	Waiver of Jury Trial	  	 	52	  	
Section 14.12	 	Headings	  	 	52	  	
Section 14.13	 	Interpretation	  	 	52	  	
Section 14.14	 	Specific Performance	  	 	53	  	
Section 14.15	 	Payment Terms	  	 	53	  	
Section 14.16	 	Survival of Covenants	  	 	53	  	
Section 14.17	 	Waiver	  	 	53	  	
 
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TABLE OF CONTENTS
(cont’d)
 
SCHEDULES

Schedule 1.1(a)	  	Distributing Assumed Liabilities	
Schedule 1.1(b)	  	Distributing Business Assets: Information Technology	
Schedule 1.1(c)	  	Publishing Assumed Liabilities: Environmental Liabilities	
Schedule 1.1(d)(iv)	  	Publishing Transferred Assets: Shared Contracts	
Schedule 1.1(d)(v)	  	Publishing Transferred Assets: Information Technology	
Schedule 2.2(b)(i)	  	Intercompany Leases	
Schedule 2.2(b)(ii)	  	Other Intercompany Agreements	
Schedule 5.9	  	Letters of Credit	
Schedule 9.1(a)(i)	  	Publishing Litigation Matters	
Schedule 9.1(a)(ii)	  	Publishing Bankruptcy Claims	
Schedule 9.1(b)(i)	  	Distributing Litigation Matters	
Schedule 9.1(b)(ii)	  	Distributing Bankruptcy Claims	
Schedule 9.3(d)	  	Reimbursement	
EXHIBITS

Exhibit A	  	Employee Matters Agreement	
Exhibit B	  	Publishing Registration Rights Agreement	
Exhibit C	  	Tax Matters Agreement	
Exhibit D	  	Transition Services Agreement	
 
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SEPARATION AND DISTRIBUTION AGREEMENT
This SEPARATION AND DISTRIBUTION AGREEMENT (this “ Agreement ”), is made as of [            ], 2014, by and between Tribune Company, a Delaware corporation (“ Distributing ”) and Tribune Publishing Company, a Delaware corporation (“ Publishing ” and, together with Distributing, the “ Parties ,” and each a “ Party ”).
WHEREAS, Distributing, through certain of its Subsidiaries, is currently engaged in the Publishing Business;
WHEREAS, the Distributing Board has determined that it is in the best interests of Distributing and its stockholders to separate from Distributing the Publishing Business, which shall be owned, operated and conducted, directly or indirectly, by Publishing;
WHEREAS, in furtherance of the foregoing, the Distributing Board has determined that it is in the best interests of Distributing and its stockholders for Distributing and certain of its Subsidiaries to enter into a series of transactions in the manner provided in this Agreement and the Ancillary Agreements whereby:
(i) ( x ) Distributing will, directly or indirectly through its Subsidiaries, own all of the Distributing Business Assets and assume (or retain) all of the Distributing Liabilities, and ( y ) Publishing will, directly or indirectly through its Subsidiaries, own all of the Publishing Business Assets and assume (or retain) all of the Publishing Liabilities;
(ii) Holders of Distributing Common Stock and Distributing Warrants will receive (without consideration being paid by such holders), on a pro rata basis, 98.5% of the outstanding shares of Publishing Common Stock and Distributing will retain 1.5% of the outstanding shares of Publishing Common Stock;
WHEREAS, in connection with the Distribution, Publishing will enter into a credit agreement with a group of financial institutions providing for a senior credit facility (the “ Senior Credit Facility ”) consisting of a term loan facility and revolving credit facility; and
WHEREAS, immediately prior to the Distribution, Publishing will pay a cash dividend to Distributing using all or a portion of the proceeds of the borrowings under the Senior Credit Facility.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the Parties hereby agree as follows:

ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Certain Defined Terms . For purposes of this Agreement:
“ Action ” means any demand, claim, counterclaim, action, suit, arbitration, inquiry, proceeding or investigation, in each case brought by or pending before any Governmental Authority or any federal, state, local, foreign or international arbitration or mediation tribunal.
“ Affiliate ” means, with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person; provided , that except where the context indicates otherwise, for purposes of this Agreement, ( i ) no member of the Distributing Group shall be deemed to be an Affiliate of any member of the Publishing Group, and ( ii ) no member of the Publishing Group shall be deemed to be an Affiliate of any member of the Distributing Group.
“ Agreement ” has the meaning set forth in the preamble.
“ Allowed Claims ” has the meaning set forth in the Plan of Reorganization.
“ Ancillary Agreements ” means
 
 	(i)	the Transition Services Agreement;	
 
 	(ii)	the Tax Matters Agreement;	
 
 	(iii)	the Employee Matters Agreement;	
 
 	(iv)	the Publishing Registration Rights Agreement;	
 
 	(v)	the IP Cross License Agreement;	
 
 	(vi)	the Trademark License Agreement;	
 
 	(vii)	the Content Sharing Agreement; and	
 
 	(viii)	the Patent License Agreement.	
“ Assets ” means, with respect to any Person, the assets, properties, claims and rights (including, goodwill) of any kind, of such Person, wherever located (including in the possession of vendors or other Persons or elsewhere), whether tangible or intangible, real, personal or mixed, or accrued or contingent, in each case whether or not recorded or reflected or required to be recorded or reflected on the books and records or financial statements of such Person, including, but not limited to, the following:
 
 	(i)	all accounting and other Records, whether in paper, microfilm, microfiche, computer tape or disk, magnetic tape or any other form;	
 
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 	(ii)	all interests in real property;	
 
 	(iii)	all interests in any capital stock or other equity interests of any Subsidiary or any other Person, all bonds, notes, debentures or other securities issued by any Subsidiary or any other Person, all loans, advances or other extensions of credit or capital contributions to any Subsidiary or any other Person and all other investments in securities of any Person, and all rights as a partner, joint venturer or participant;	
 
 	(iv)	all deposits, letters of credit and performance and surety bonds;	
 
 	(v)	all Intellectual Property and tangible embodiments thereof;	
 
 	(vi)	all Information;	
 
 	(vii)	all prepaid expenses, trade accounts and other accounts and notes receivable;	
 
 	(viii)	all rights under Contracts, all claims or rights against any Person, choses in action or similar rights, whether accrued or contingent, whether in tort, contract or otherwise and whether arising by way of counterclaim or otherwise;	
 
 	(ix)	subject to Section 8.1(b) , all rights under insurance policies and all rights in the nature of insurance, indemnification or contribution;	
 
 	(x)	all licenses, permits, approvals and authorizations which have been issued by any Governmental Authority and all pending applications therefor;	
 
 	(xi)	all cash and cash equivalents, bank accounts, lock boxes and other deposit arrangements;	
 
 	(xii)	all interest rate, currency, commodity or other swap, collar, cap or other hedging or similar agreements or arrangements; and	
 
 	(xiii)	all goodwill as a going concern and other intangible properties.	
“ Bankruptcy Administration Costs and Activities ” means all actions and all associated costs necessary to conduct the ordinary course administration of the Bankruptcy Proceedings, including, without limitation, ( i ) preparing, filing, noticing and prosecuting all pleadings to extend claims objection deadlines in the Bankruptcy Proceedings, ( ii ) the services performed by the claims and noticing agent in the Bankruptcy Proceedings, ( iii ) maintaining the informational website relating to the Bankruptcy Proceedings, ( iv ) preparing, filing, noticing and prosecuting all pleadings to administratively close some or all of the Bankruptcy Proceedings and ( v ) the handling, negotiation, resolution, and/or adjudication of the Actions asserted by the Litigation Trustee (as defined in the Plan of Reorganization) in connection with the Bankruptcy Proceedings ( excluding , for the avoidance of doubt, ( A ) all obligations to pay or otherwise satisfy any and all Allowed Claims in the Bankruptcy Proceedings, ( B ) responsibility for the costs and expenses incurred in connection with the handling, negotiation, resolution, and/or adjudication of the proofs of claim filed in the Bankruptcy Proceedings, ( C ) responsibility for the
 
3

costs and expenses incurred in connection with the handling, negotiation, resolution, and/or adjudication of the Actions asserted in the Bankruptcy Proceedings relating to the third-party appeals of the confirmation of the Plan of Reorganization and ( D ) all actions and costs described in Section 9.3(a) and Section 9.3(c) ).
“ Bankruptcy Indemnification Claims ” means any and all Actions asserted in the Bankruptcy Proceedings by ( i ) then-current or former directors or officers of any entity asserting rights of indemnification from any such entity, and ( ii ) Valuation Research Corporation asserting rights of indemnification, in each case, without regard to the entity against which the pertinent Action was asserted by the claimant in the Bankruptcy Proceedings.
“ Bankruptcy Proceedings ” means the proceedings commenced by any entity on December 8, 2008 (or, in the case of Tribune CNLBC, LLC, on October 12, 2009) that were jointly administered under the caption In re Tribune Company , Case No. 08-13141 (KJC) in the United States Bankruptcy Court for the District of Delaware.
“ Business ” means either the Distributing Business or the Publishing Business, as the context requires.
“ Business Day ” means any day that is not a Saturday, a Sunday, or any other day on which banks are required or authorized by Law to be closed in the City of New York.
“ Business Separation ” has the meaning set forth in Section 2.1 .
“ CareerBuilder ” has the meaning set forth in Section 5.10 .
“ Code ” means the Internal Revenue Code of 1986, as amended from time to time, together with the rules and regulations promulgated thereunder.
“ Confidential Information ” has the meaning set forth in Section 6.5(a) .
“ Consents ” means any consents, waivers or approvals from, or notification requirements to, any Person other than a Governmental Authority or a member of either Group.
“ Content Sharing Agreement ” means the Content Sharing Agreement, effective as of immediately following the Distribution Effective Time, by and between Distributing and Publishing.
“ Contract ” means any contract, agreement, lease, commitment, license, consensual obligation, promise or undertaking (whether written or oral and whether express or implied) that is legally binding on any Person or any part of its property under applicable Law, including all claims or rights against any Person, choses in action and similar rights, whether accrued or contingent with respect to any such contract, agreement, lease, purchase and/or commitment, license, consensual obligation, promise or undertaking.
“ Control ” (including the terms “ controlled by ” and “ under common control with ”), with respect to the relationship between or among two or more Persons, means the possession, directly or indirectly or as trustee, personal representative or executor, of the power to direct or cause the direction of the affairs or management of a Person, whether through the ownership of voting securities, as trustee, personal representative or executor, by contract or credit arrangement or otherwise.
 
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“ Deferred Transfer Asset ” has the meaning set forth in Section 5.3(a) .
“ Deferred Transfer Liability ” has the meaning set forth in Section 5.3(a) .
“ Dispute Meeting ” has the meaning set forth in Section 11.2(b) .
“ Dispute Notice ” has the meaning set forth in Section 11.2(b) .
“ Disputes ” has the meaning set forth in Section 11.1 .
“ Distributing ” has the meaning set forth in the preamble.
“ Distributing Assumed Liabilities ” means, without duplication,
 
 	(i)	any and all Liabilities of members of the Publishing Group as and to the extent relating to, arising out of, or resulting from ( A ) the Distributing Business or ( B ) any Distributing Business Assets or any former Assets of any member of the Distributing Group ( including , for the avoidance of doubt, any Action against a member of the Publishing Group that is listed on Schedule 9.1(b)(i) and Schedule 9.1(b)(ii) ), in each case, other than Liabilities expressly allocated to the Publishing Group pursuant to this Agreement or the Ancillary Agreements;	
 
 	(ii)	the Distributing Assumed Transaction Liabilities;	
 
 	(iii)	all Liabilities expressly allocated to the Distributing Group pursuant to the Ancillary Agreements;	
 
 	(iv)	the Bankruptcy Administration Costs and Activities;	
 
 	(v)	all Liabilities arising from or relating to the presence or release of hazardous substances or other violations of, or non-compliance with, any applicable Environmental Laws (or permits required thereunder) at any location owned, occupied or used by the Publishing Business, or otherwise resulting from the operation of the Publishing Business, in each case on or prior to the Distribution Date, except, in each case, for ( x ) such Liabilities specifically designated as Publishing Assumed Liabilities on Schedule 1.1(c) or ( y ) any such Liabilities arising at a location subject to an Intercompany Lease during the term of the applicable Intercompany Lease (which Liabilities shall be governed by the terms of such Intercompany Lease, except for any Liabilities specifically designated as Publishing Assumed Liabilities on Schedule 1.1(c) ,which shall be governed by the terms of this Agreement); and	
 
 	(vi)	all Liabilities listed on Schedule 1.1(a) .	
 
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“ Distributing Assumed Transaction Liabilities ” means
 
 	(i)	the Distributing Transaction Liabilities; and	
 
 	(ii)	50% of the Shared Transaction Liabilities.	
“ Distributing Board ” means the board of directors of Distributing.
“ Distributing Business ” means ( i ) the businesses and operations of any member of the Distributing Group and ( ii ) any Distributing Discontinued Business, in each case, other than the Publishing Business.
“ Distributing Business Assets ” means, without duplication, any and all Assets owned by members of the Distributing Group and the Publishing Group (other than the Publishing Business Assets), which, for the avoidance of doubt, includes ( i ) any and all real property owned by any member of the Publishing Group or the Distributing Group, ( ii ) all cash and cash equivalents held by the Distributing Group and ( iii ) all Information Technology listed on Schedule 1.1(b) .
“ Distributing Class A Common Stock ” means the class A common stock of Distributing, par value $0.001 per share.
“ Distributing Class B Common Stock ” means the class B common stock of Distributing, par value $0.001 per share.
“ Distributing Common Stock ” means Distributing Class A Common Stock and Distributing Class B Common Stock.
“ Distributing Discontinued Business ” means any businesses and operations of any member of the Distributing Group that was terminated, divested, discontinued, sold, abandoned, shut down or otherwise disposed of prior to the Distribution Date.
“ Distributing Group ” means, collectively, Distributing and all of its Subsidiaries and any of its or their predecessors (other than members of the Publishing Group).
“ Distributing Indemnified Party ” has the meaning set forth in Section 10.2 .
“ Distributing Liabilities ” means, without duplication, any and all Liabilities of members of the Distributing Group and the Publishing Group (other than the Publishing Liabilities), which, for the avoidance of doubt, includes the Distributing Assumed Liabilities, but excludes the Publishing Assumed Liabilities.
“ Distributing Litigation Matters ” means ( i ) any and all Actions that are primarily related to the Distributing Business Assets, the Distributing Liabilities or the Distributing Business, including all Actions listed on Schedule 9.1(b)(i) , but excluding any Joint Litigation Matters, and ( ii ) ( x ) all Actions listed on Schedule 9.1(b)(ii) , ( y ) any and all other Actions presently existing or that may arise in the Bankruptcy Proceedings that are primarily related to the Distributing Business Assets, the Distributing Liabilities or the Distributing Business and ( z ) all Bankruptcy Indemnification Claims.
 
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“ Distributing Transaction Liabilities ” means 100% of the Transaction Liabilities arising from, relating to, or derivative of any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent relating to the Distributing Group contained in ( x ) the Publishing Information Statement, ( y ) other disclosure made to the holders of Distributing Common Stock and Distributing Warrants or ( z ) any filings made with the SEC in connection with the Transactions.
“ Distributing Warrants ” means warrants to purchase Distributing Common Stock having an exercise price of $0.001 per share of Distributing Common Stock.
“ Distribution ” has the meaning set forth in Section 4.1 .
“ Distribution Date ” has the meaning set forth in Section 4.1 .
“ Distribution Effective Time ” means 12:01 a.m. Eastern Time on the Distribution Date or at such other time as the Parties may agree.
“ Distributing Record Holders ” has the meaning set forth in Section 3.2(a)(vi) .
“ Employee Matters Agreement ” means the Employee Matters Agreement, effective as of the Distribution Date, by and between Distributing and Publishing, substantially in the form attached hereto as Exhibit A .
“ Encumbrance ” means any security interest, pledge, hypothecation, mortgage, lien or encumbrance, whether or not filed, recorded or otherwise perfected under applicable Law.
“ Environment ” means the ambient air, surface water, ground water, land, and surface or subsurface strata, and any medium or area included in the definition of “Environment” under any applicable Environmental Law.
“ Environmental Law ” means any Law, including any international, federal, state, provincial, local, territorial or municipal Law or any rule or regulation promulgated by any governmental agency, tribunal or commission, governing or relating to pollution, protection of human health or safety as such relate to exposure to hazardous substances, the Environment or natural resources or exposure to any hazardous substance, hazardous waste, toxic substance, pollutant, and any other similarly described substance, including petroleum, petroleum products, asbestos and asbestos containing materials.
“ Executive Committee ” has the meaning set forth in Section 11.2(a) .
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended from time to time, together with the rules and regulations promulgated thereunder.
 
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“ Governmental Approvals ” means any notices or reports to be submitted to, or other filings to be made with, or any consents, registrations, approvals, licenses, permits or authorizations to be obtained from, any Governmental Authority.
“ Governmental Authority ” means any U.S. or non-U.S. federal, national, supranational, state, provincial, local or other government, governmental, regulatory or administrative authority, agency or commission or any court, tribunal or judicial or arbitral body.
“ Group ” means the Distributing Group or the Publishing Group, as the context requires.
“ Implementation Documents ” has the meaning set forth in Section 5.1 .
“ Indemnified Party ” has the meaning set forth in Section 10.5(a) .
“ Indemnifying Party ” has the meaning set forth in Section 10.5(a) .
“ Indemnity Payment ” has the meaning set forth in Section 10.5(a) .
“ Information ” means information, whether or not patentable or copyrightable, in written, oral, electronic or other tangible or intangible forms, stored in any medium, including, studies, reports, records, books, contracts, instruments, surveys, discoveries, ideas, concepts, know-how, techniques, designs, specifications, drawings, blueprints, artwork, design, research and development files, diagrams, models, prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes, computer programs or other software, marketing plans, customer data, cost information, sales and pricing data, customer prospect lists, supplier records and vendor data, correspondence and lists, product literature, communications by or to attorneys (including attorney-client privileged communications), memoranda and other materials prepared by attorneys or under their direction (including attorney work product), and other technical, financial, employee or business information or data.
“ Information Technology ” means all hardware, computers, Software, servers, workstations, routers, hubs, switches, data, databases, data communications lines, network and telecommunications equipment, Internet-related information technology infrastructure and other information technology equipment.
“ Intellectual Property ” means, in any and all jurisdictions throughout the world, any ( i ) trademarks, service marks, trade names, trade dress, Internet domain names, logos and other source identifiers and the goodwill associated with any and all of the foregoing and symbolized thereby (“ Marks ”), ( ii ) copyrights and copyrightable works, ( iii ) rights in Software and Internet websites, ( iv ) registrations and applications to register or renew the registration of any of the foregoing, ( v ) patents and patent applications, including all reissues, divisions, renewals, extensions, provisionals, continuations and continuations-in-part thereof, ( vi ) Trade Secrets and any rights therein and thereto and ( vii ) all other intellectual property rights.
“ Intercompany Accounts ” means all accounts receivable and accounts payable between one or more members of the Publishing Group, on the one hand, and one or more members of the Distributing Group, on the other hand.
 
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“ Intercompany Agreements ” means this Agreement, the Ancillary Agreements and the other agreements, arrangements, commitments or understandings, whether or not in writing, solely between one or more members of the Publishing Group, on the one hand, and one or more members of the Distributing Group, on the other hand ( excluding , for the avoidance of doubt, Shared Contracts).
“ Intercompany Leases ” has the meaning set forth in Section 2.2(b) .
“ Internal Control Audit and Management Assessments ” has the meaning set forth in Section 7.2 .
“ Internal Reorganization ” has the meaning set forth in Section 2.1(a) .
“ IP Cross License Agreement ” means the Intellectual Property License Agreement, effective as of immediately following the Distribution Effective Time, by and between Distributing and Publishing.
“ Joint Litigation Matters ” means any and all Actions in respect of any Shared Transaction Liabilities.
“ Law ” means any U.S. or non-U.S. federal, national, supranational, state, provincial, local or similar statute, law, ordinance, regulation, rule, code, order, license, permit, authorization, approval, consent, decree, injunction, binding judicial or administrative interpretation or other requirement (including, common law), in each case, enacted, promulgated, issued or entered by a Governmental Authority.
“ Letters of Credit ” has the meaning set forth in Section 5.9 .
“ Liabilities ” or “ Liability ” means with respect to any Person, any and all claims, debts, demands, actions, causes of action, suits, damages, costs, obligations, accruals, accounts payable, reckonings, bonds, indemnities and similar obligations, agreements, promises, guarantees, make whole agreements and similar obligations, and other liabilities and requirements of such Person, including all contractual obligations, whether accrued or fixed, absolute or contingent, matured or unmatured, liquidated or unliquidated, reserved or unreserved, known or unknown, or determined or determinable, whenever arising and including those arising under any Law, Action, threatened or contemplated Action, order or consent decree of any Governmental Authority or any award of any arbitrator or mediator of any kind, and those arising under any Contract, including those arising under this Agreement, in each case, whether or not recorded or reflected or required to be recorded or reflected on the books and records or financial statements of any Person. For the avoidance of doubt, Liabilities shall include attorneys’ fees, the costs and expenses of all demands, assessments, judgments, settlements and compromises, and any and all other costs and expenses whatsoever reasonably incurred in connection with anything contemplated by the preceding sentence.
“ Marks ” has the meaning set forth in the definition of Intellectual Property.
“ Modified Affiliate Agreement ” has the meaning set forth in Section 5.10 .
 
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“ Overlapping Fiscal Year ” has the meaning set forth in Section 7.1(a) .
“ Party ” or “ Parties ” has the meaning set forth in the preamble.
“ Patent License Agreement ” means the Patent License Agreement, effective as of immediately following the Distribution Effective Time, by and between Distributing and Publishing.
“ Person ” means any individual, partnership, firm, corporation, limited liability company, association, trust, joint venture, unincorporated organization, other entity or Governmental Authority, as well as any syndicate or group that would be deemed to be a person under Section 13(d)(3) of the Exchange Act.
“ Plan of Reorganization ” means the Fourth Amended Joint Plan of Reorganization for Tribune Company and Its Subsidiaries Proposed by the Debtors (as defined therein), the Official Committee of Unsecured Creditors (as defined therein), Oaktree Capital Management, L.P., Angelo, Gordon & Co., L.P., and JPMorgan Chase Bank, N.A., dated July 19, 2012 (as the same may be amended, modified or supplemented from time to time in accordance with the terms and provisions thereof).
“ PLR ” has the meaning set forth in Section 3.2(a)(iii) .
“ Public Filings ” has the meaning set forth in Section 7.1(d) .
“ Publishing ” has the meaning set forth in the preamble.
“ Publishing Annual Financial Statements ” has the meaning set forth in Section 7.1(c) .
“ Publishing Assumed Liabilities ” means, without duplication,
 
 	(i)	any and all Liabilities of members of the Distributing Group as and to the extent relating to, arising out of, or resulting from ( A ) the Publishing Business, or ( B ) any Publishing Business Assets or any former Assets of any member of the Publishing Group ( including , for the avoidance of doubt, any Action against a member of the Distributing Group that is listed on Schedule 9.1(a)(i) and Schedule 9.1(a)(ii) ), in each case, other than the Distributing Assumed Liabilities;	
 
 	(ii)	the Publishing Assumed Transaction Liabilities;	
 
 	(iii)	all Liabilities expressly allocated to the Publishing Group pursuant to this Agreement or the Ancillary Agreements;	
 
 	(iv)	notwithstanding anything to the contrary in any Intercompany Lease, all Liabilities listed on Schedule 1.1(c) ; and	
 
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 	(v)	except for any Liabilities specifically designated as Publishing Liabilities (disregarding this clause (v)  of the definition of Publishing Assumed Liabilities) or Distributing Assumed Liabilities pursuant to the terms of this Agreement or any Ancillary Agreement, any and all other Liabilities of the Distributing Group as of the Distribution Effective Time ( A ) reflected on the Publishing Pro Forma Balance Sheet, or ( B ) if acquired by, or allocated to, either Group after the date of the Publishing Pro Forma Balance Sheet, are of a nature or type that would have been reflected on the combined balance sheet of the Publishing Group if such balance sheet were prepared as of the time of the Business Separation using the same principles and accounting policies under which the Publishing Pro Forma Balance Sheet was prepared, to the extent used primarily in the operation of the Publishing Business and subject to the discharge of any such Liabilities subsequent to the date of the Publishing Pro Forma Balance Sheet (it being understood that ( x ) the Publishing Pro Forma Balance Sheet shall be used to determine the types of, and methodologies used to determine, those Liabilities that are included in the definition of Publishing Liabilities pursuant to this clause (v)  and ( y ) the amounts set forth on the Publishing Pro Forma Balance Sheet with respect to any Liabilities shall not be treated as limitations on the amounts of such Liabilities that shall be included in the definition of Publishing Liabilities pursuant to this clause (v) ).	
“ Publishing Assumed Transaction Liabilities ” means
 
 	(i)	the Publishing Transaction Liabilities; and	
 
 	(ii)	50% of the Shared Transaction Liabilities.	
“ Publishing Business ” means ( i ) the businesses and operations of the Publishing Group, including the business and operations of Publishing as more fully described in the Publishing Information Statement, and ( ii ) any Publishing Discontinued Business.
“ Publishing Business Assets ” means, without duplication,
 
 	(i)	all of the issued and outstanding capital stock or other equity interests of members of the Publishing Group, other than Publishing; and	
 
 	(ii)	all of the right, title and interest in and to any and all Assets owned by members of the Publishing Group after giving effect to the Ancillary Agreements and the transactions contemplated by this Agreement (including Section 2.1 ) and for the avoidance of doubt, including the Publishing Transferred Assets, but excluding ( x ) any and all real property owned by any member of the Publishing Group or the Distributing Group and ( y ) any Deferred Transfer Assets that would otherwise be Distributing Business Assets.	
“ Publishing Common Stock ” means the common stock of Publishing, par value $0.001 per share.
“ Publishing Discontinued Business ” means any businesses and operations of any member of the Publishing Group that was terminated, divested, discontinued, sold, abandoned, shut down or otherwise disposed of prior to the Distribution Date.
 
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“ Publishing Group ” means, collectively, Publishing, Publishing Holdco, the Publishing Operating Entities and all other direct or indirect Subsidiaries of Publishing Holdco and any predecessors of any of the foregoing.
“ Publishing Holdco ” means Tribune Publishing Company, LLC.
“ Publishing Holdco Contribution ” has the meaning set forth in Section 2.1(b) .
“ Publishing Indemnified Party ” has the meaning set forth in Section 10.3 .
“ Publishing Information Statement ” means the Information Statement, dated [            ], 2014 of Distributing and Publishing, relating to the Transactions.
“ Publishing Liabilities ” means, without duplication,
 
 	(i)	any and all Liabilities of members of the Publishing Group after giving effect to the Ancillary Agreements and the transactions contemplated by this Agreement (including Section 2.1 ), including the Publishing Assumed Liabilities, but excluding the ( A ) Distributing Assumed Liabilities, ( B ) any Liabilities for which members of the Publishing Group are entitled to indemnification from the Distributing Group pursuant to the Tax Matters Agreement and ( C ) any Deferred Transfer Liabilities that would otherwise be Distributing Liabilities; and	
 
 	(ii)	any and all Liabilities to the extent relating to, arising out of or resulting from, ( A ) any Publishing Business Asset, including any and all Liabilities of the members of the Publishing Group, ( B ) the operation or conduct of the Publishing Business, as conducted at any time prior to the Distribution (including any Liability relating to, arising out of or resulting from any act or failure to act by any Representative (whether or not such act or failure to act is or was within such Person’s authority), to the extent such act or failure to act relates to the Publishing Business), and ( C ) the operation or conduct of any business by any member of the Publishing Group at any time after the Distribution (including any Liability relating to, arising out of or resulting from any act or failure to act by any Representative (whether or not such act or failure to act is or was within such Person’s authority)).	
“ Publishing Litigation Matters ” means ( i ) any and all Actions that are primarily related to the Publishing Business Assets, the Publishing Liabilities or the Publishing Business, including all Actions listed on Schedule 9.1(a)(i) , but excluding any Joint Litigation Matters, and ( ii ) ( x ) all Actions listed on Schedule 9.1(a)(ii) and ( y ) any and all other Actions presently existing or that may arise in the Bankruptcy Proceedings that are primarily related to the Publishing Business Assets, the Publishing Liabilities or the Publishing Business, but excluding the Bankruptcy Indemnification Claims.
“ Publishing Operating Entities ” means ( i ) The Morning Call, LLC, a Delaware limited liability company, ( ii ) Chicago Tribune Company, LLC, a Delaware limited liability company, ( iii ) Chicagoland Publishing Company, LLC, a Delaware limited liability company, ( iv ) Tribune Direct Marketing, LLC, a Delaware limited liability company, ( v ) The Baltimore Sun Company, LLC, a Delaware limited liability company, ( vi ) Orlando Sentinel Communications Company,
 
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LLC, a Delaware limited liability company, ( vii ) Los Angeles Times Communications LLC, a Delaware limited liability company, ( viii ) Builder Media Solutions, LLC, a Delaware limited liability company, ( ix ) California Community News, LLC, a Delaware limited liability company, ( x ) The Daily Press, LLC, a Delaware limited liability company, ( xi ) The Hartford Courant Company, LLC, a Delaware limited liability company, ( xii ) Sun-Sentinel Company, LLC, a Delaware limited liability company, ( xiii ) forsalebyowner.com, LLC, a Delaware limited liability company, ( xiv ) Internet Foreclosure Service, LLC, a Delaware limited liability company, ( xv ) ForSaleByOwner.com Referral Services, LLC, a Delaware limited liability company, ( xvi ) Local Pro Plus Realty, LLC, a Delaware limited liability company, ( xvii ) Tribune Washington Bureau, LLC, a Delaware limited liability company, ( xviii ) Hoy Publications, LLC, a Delaware limited liability company, ( xix ) Tribune Interactive, LLC, a Delaware limited liability company, ( xx ) Tribune 365, LLC, a Delaware limited liability company, ( xxi ) Tribune Content Agency, LLC, a Delaware limited liability company (formerly known as TMS News and Features, LLC), ( xxii ) Tribune Content Agency London, LLC, a Delaware limited liability company (formerly known as Tribune Media Services London, LLC), ( xxiii ) Tribune Hong Kong Limited, a private company limited by shares incorporated in Hong Kong, ( xxiv ) Blue Lynx Media, LLC, a Delaware limited liability company, ( xxv ) TCA News Service, LLC, a Delaware limited liability company, ( xxvi ) Capital-Gazette Communications, LLC, a Maryland limited liability company, ( xxvii ) Carroll County Times, LLC, a Maryland limited liability company (formerly known as Landmark Community Newspapers of Maryland, LLC), ( xxviii ) McClatchy / Tribune Information Services, a District of Columbia partnership, and ( xxix ) the issued and outstanding equity interests held directly or indirectly by Publishing Holdco of ( A ) CIPS Marketing Group, Inc., a California corporation, and ( B ) HomeFinder.com, LLC, a Delaware limited liability company.
“ Publishing Pro Forma Balance Sheet ” means the pro forma combined balance sheet of the Publishing Group, including the notes thereto, as of March 30, 2014, included in the Publishing Information Statement.
“ Publishing Quarterly Financial Statements ” has the meaning set forth in Section 7.1(b) .
“ Publishing Registration Rights Agreement ” means the Registration Rights Agreement, effective as of the Distribution Date, by and among Publishing and certain stockholders of Publishing party thereto (after giving effect to the Distribution), substantially in the form attached hereto as Exhibit B .
“ Publishing Transaction Liabilities ” means 100% of the Transaction Liabilities arising from, relating to, or derivative of any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent relating to the Publishing Group contained in ( x ) the Publishing Information Statement, ( y ) other disclosure made to the holders of Distributing Common Stock and Distributing Warrants or ( z ) any filings made with the SEC in connection with the Transactions.
 
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“ Publishing Transferred Assets ” means, without duplication,
 
 	(i)	any and all tangible personal property of Distributing used primarily by the Publishing Business;	
 
 	(ii)	any and all Assets of Distributing with respect to Information (excluding any Information that constitutes Intellectual Property) primarily relating to the Publishing Business;	
 
 	(iii)	any and all Assets of either Group with respect to the Publishing Litigation Matters (which, for the avoidance of doubt, excludes all reserve accounts of Distributing established for the payment of Allowed Claims asserted in the Bankruptcy Proceedings);	
 
 	(iv)	any and all Shared Contracts or Contracts (including licenses from or to Third Parties in respect of Intellectual Property) of Distributing necessary to operate and manage the Publishing Business and used primarily by the Publishing Business, including all Shared Contracts listed on Schedule 1.1(d)(iv) ;	
 
 	(v)	any and all Information Technology owned, leased or licensed by or to any member of Distributing that fall into in any category listed on Schedule 1.1(d)(v) , excluding all Information Technology of Distributing listed on Schedule 1.1(b) ;	
 
 	(vi)	except for any Assets specifically designated as Publishing Business Assets (disregarding this clause (vi)  of the definition of Publishing Transferred Assets) or Distributing Business Assets pursuant to the terms of this Agreement, any Ancillary Agreement, any Intercompany Lease or any Intercompany Agreement listed on Schedule 2.2(b)(ii) , any and all other Assets of the Distributing Group as of the Distribution Effective Time ( A ) reflected on the Publishing Pro Forma Balance Sheet, or ( B ) if acquired by, or allocated to, either Group after the date of the Publishing Pro Forma Balance Sheet, are of a nature or type that would have been reflected on the combined balance sheet of the Publishing Group if such balance sheet were prepared as of the time of the Business Separation using the same principles and accounting policies under which the Publishing Pro Forma Balance Sheet was prepared, to the extent used primarily in the operation of the Publishing Business (it being understood that ( x ) the Publishing Pro Forma Balance Sheet shall be used to determine the types of, and methodologies used to determine, those Assets that are included in the definition of Publishing Business Assets pursuant to this clause (vi)  and ( y ) the amounts set forth on the Publishing Pro Forma Balance Sheet with respect to any Assets shall not be treated as minimum amounts or limitations on the amounts of such Assets that shall be included in the definition of Publishing Business Assets pursuant to this clause (vi) ; and	
 
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 	(vii)	all other Assets that are held by Distributing immediately prior to the Distribution and that ( A ) primarily relate to or are primarily used or held for use in the Publishing Business and ( B ) do not materially relate to the Distributing Business, in each case, as conducted immediately prior to the Distribution (for the avoidance of doubt, the intention of this clause (vii)  is only to rectify an inadvertent omission of transfer or assignment of any Asset that, had the Parties given specific consideration to such Asset as of the date of this Agreement, would have otherwise been classified as a Publishing Business Asset);	
provided that no Asset that is not identified on a schedule referenced in this definition shall be a Publishing Transferred Asset unless a claim with respect thereto is made by Publishing or any other member of the Publishing Group on or prior to the date that is twenty-four (24) months after the Distribution.
“ Record Date ” means 5:00 p.m. Eastern Time on [            ], 2014.
“ Records ” means documents, files and other books and records, including, books and records relating to financial reporting, internal audit, employee benefits, past acquisition or disposition transactions, Actions, and email files and backup tapes regarding any of the foregoing.
“ Representatives ” means directors, officers, employees, agents, consultants, accountants, attorneys and any other advisors, including representatives of the foregoing.
“ Resolution Failure Date ” has the meaning set forth in Section 11.2(b) .
“ SEC ” means the Securities and Exchange Commission.
“ Securities Act ” means the Securities Act of 1933, as amended from time to time, together with the rules and regulations promulgated thereunder.
“ Senior Credit Facility ” has the meaning set forth in the recitals.
“ Shared Contracts ” means agreements, arrangements, commitments or understandings, whether or not in writing, between one or more members of the Publishing Group and / or one or more members of the Distributing Group, on the one hand, and any Third Parties, on the other hand, that are used in the conduct of, or directly benefit or burden, either ( i ) both the Distributing Business and the Publishing Business or ( ii ) the Business of a Group not party thereto.
“ Shared Privileges ” has the meaning set forth in Section 6.8(d) .
“ Shared Transaction Liabilities ” means the Transaction Liabilities other than the Distributing Transaction Liabilities and the Publishing Transaction Liabilities.
“ Software ” means all computer software, including but not limited to, application software, system software, firmware, middleware and mobile digital applications, including all source code and object code versions of any and all of the foregoing, and any backups of source code, in any and all forms and media, and all related documentation.
 
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“ Subsidiary ” means, with respect to any Person, any entity of which securities or other ownership interests ( i ) having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions or ( ii ) representing at least 50% of such securities or ownership interests are at the time directly or indirectly owned by such Person, in each case, only for so long as such entity remains a Subsidiary of such Person.
“ Tax ” or “ Taxes ” has the meaning set forth in the Tax Matters Agreement.
“ Tax Matters Agreement ” means the Tax Matters Agreement, effective as of the Distribution Date, by and between Distributing and Publishing, substantially in the form attached hereto as Exhibit C .
“ Third Party ” means any Person that is not a Party or an Affiliate of either Party.
“ Third Party Claim ” has the meaning set forth in Section 10.8(a) .
“ Third Party Proceeds ” has the meaning set forth in Section 10.5(a) .
“ Trade Secrets ” means all inventions, processes, designs, formulae, models, tools, algorithms, trade secrets, know-how, ideas, research and development, data, databases and confidential information.
“ Trademark License Agreement ” means the Trademark License Agreement, effective as of immediately following the Distribution Effective Time, by and among Distributing, Tribune Broadcasting Hartford, LLC and Publishing.
“ Transaction Liabilities ” means any and all Liabilities (other than any Liabilities specifically designated, pursuant to the terms of this Agreement or any Ancillary Agreement, as ( x ) Publishing Liabilities (disregarding clause (ii) of the definition of Publishing Assumed Liabilities) or ( y ) Distributing Assumed Liabilities (disregarding clause (ii) of the definition thereof)) arising from, relating to, or derivative of any Action, whether commenced prior to, on or subsequent to the Distribution Effective Time, with respect to the Transactions made or brought by any Third Party against any member of either Group, including any and all Liabilities under applicable Laws (including, federal and state securities Laws) arising from, relating to, or derivative of any Action relating to any public disclosure or disclosure to the holders of Distributing Common Stock or Distributing Warrants (or absence of such disclosure) at or prior to the Distribution Effective Time by any member of either Group in connection with the Transactions.
“ Transactions ” means, collectively, the Business Separation, the Distribution and any other transactions contemplated by this Agreement and the Ancillary Agreements.
“ Transfer Impediment ” has the meaning set forth in Section 5.3(a) .
“ Transition Services Agreement ” means the Transition Services Agreement, effective as of the Distribution Date, by and between Distributing and Publishing, substantially in the form attached hereto as Exhibit D .
“ Unreleased Liability ” has the meaning set forth in Section 5.2 .
 
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“ Unreleased Person ” has the meaning set forth in Section 5.2 .
“ Unresolved Disputes ” has the meaning set forth in Section 11.2(b) .
ARTICLE II
THE BUSINESS SEPARATION
Section 2.1 Business Separation . On the terms and subject to the conditions set forth in this Agreement, prior to the Distribution (but subject to Section 5.2 with respect to Unreleased Liabilities and Section 5.3 with respect to Deferred Transfer Assets and Deferred Transferred Liabilities), the transactions set forth in this Section 2.1 (collectively, the “ Business Separation ”) shall take place in the order provided below:
(a) Internal Reorganization . The following transactions shall be consummated at any time, and in any order, prior to the Distribution (collectively, the “ Internal Reorganization ”):
(i) Distributing shall, and shall cause the other members of the Distributing Group to, assign, transfer, convey and deliver to the applicable members of the Publishing Group, all of the Distributing Group’s right, title and interest in and to all of the Publishing Transferred Assets, and Distributing shall cause the applicable members of the Publishing Group to accept, assume and agree to perform, discharge and fulfill all Publishing Assumed Liabilities in accordance with their respective terms; and
(ii) Distributing shall cause the members of the Publishing Group to, assign, transfer, convey and deliver to the applicable members of the Distributing Group, all of the Publishing Group’s right, title and interest in and to all the Distributing Business Assets, and Distributing shall (or shall cause other applicable members of the Distributing Group to) accept, assume and agree to perform, discharge and fulfill all the Distributing Assumed Liabilities in accordance with their respective terms.
(b) Publishing Holdco Contribution . Following the Internal Reorganization, Distributing shall contribute all of its right, title and interest in and to all of the issued and outstanding equity interests of Publishing Holdco to Publishing (the “ Publishing Holdco Contribution ”).
(c) Incurrence of Borrowings . Immediately following the Publishing Holdco Contribution, Publishing shall enter into the Senior Credit Facility and incur borrowings in the amount of $[350,000,000] million in connection therewith.
(d) Distribution of Cash . Immediately following Publishing’s receipt of the proceeds of the borrowings under the Senior Credit Facility, Publishing shall distribute to Distributing cash in the amount of $[275,000,000] from the proceeds of the borrowings under the Senior Credit Facility.
 
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Pursuant to this Section 2.1 and unless otherwise set forth in this Agreement or any Ancillary Agreement, ( x ) Publishing, or a member of the Publishing Group, shall be the sole owner, and shall have exclusive right, title and interest in and to, all Publishing Business Assets and ( y ) Distributing, or a member of the Distributing Group, shall be the sole owner, and shall have exclusive right, title and interest in and to, all Distributing Business Assets. Pursuant to this Section 2.1 and unless otherwise set forth in this Agreement or any Ancillary Agreement, from and after the Distribution, ( A ) Publishing or a member of the Publishing Group shall be solely liable for, and shall faithfully perform, fulfill and discharge fully in due course in accordance with their respective terms, all Publishing Liabilities and ( B ) Distributing or a member of the Distributing Group shall be solely liable for, and shall faithfully perform, fulfill and discharge fully in due course in accordance with their respective terms, all Distributing Liabilities, in each case, regardless of ( i ) when or where such Liabilities arose or arise, ( ii ) whether the facts upon which they are based occurred prior to, on or subsequent to the Distribution, ( iii ) where or against whom such Liabilities are asserted or determined (including any Liabilities arising out of claims made by any member of the Distributing Group or the Publishing Group or any of their past or present respective directors, officers, employees, agents, Subsidiaries or Affiliates against any member of the Distributing Group or the Publishing Group, as the case may be) and ( iv ) whether arising from or alleged to arise from negligence, recklessness, violation of Law, fraud, misrepresentation or otherwise.
Section 2.2 Intercompany Arrangements .
(a) Contemporaneously with the Publishing Holdco Contribution, to the extent not previously effected pursuant to the Internal Reorganization, except as set forth in Section 2.2(b) , in furtherance of the releases and other provisions of Section 10.1 , Publishing, on behalf of itself and each other member of the Publishing Group, on the one hand, and Distributing, on behalf of itself and each other member of the Distributing Group, on the other hand, shall terminate, effective as of the Distribution Effective Time, any and all Intercompany Agreements in effect as of the Distribution Date and shall settle, or cause to be settled, all Intercompany Accounts on or prior to the Distribution Effective Time. No such terminated Intercompany Agreements (including any provision thereof that purports to survive termination) shall be of any further force or effect after the Distribution Effective Time. Each Party shall, at the reasonable request of the other Party, take, or cause to be taken, such other actions as may be necessary to effect the foregoing.
(b) The provisions of Section 2.2(a) shall not apply to any of the following Intercompany Agreements (or to any of the provisions thereof) or Intercompany Accounts: ( i ) this Agreement and the Ancillary Agreements (and each other Intercompany Agreement or Intercompany Account expressly contemplated to survive hereby or thereby, including the Implementation Documents), ( ii ) the leases, subleases and other agreements, together with any amendments and modifications thereto, pursuant to which a member of the Distributing Group conveys to a member of the Publishing Group a leasehold interest in real property, each of which is described on Schedule 2.2(b)(i) (collectively, the “ Intercompany Leases ”), ( iii ) the Intercompany Agreements listed on Schedule 2.2(b)(ii) and ( iv ) any outstanding intercompany trade receivables or payables incurred in the ordinary course of business that are reflected in the books and records of the Groups or otherwise documented in writing in accordance with past practices.
(c) Upon the request of either Party following the Distribution Date, the other Party shall, and shall cause the members of its Group to, negotiate in good faith to enter into a separate Contract on arms-length terms with respect to the subject matter of any Intercompany Agreement that Distributing determines in good faith was inadvertently terminated pursuant to Section 2.2(a) .
 
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(d) Effective as of the Distribution Date, other than ( x ) as expressly provided in this Agreement or the Ancillary Agreements and ( y ) any Shared Contract included in the Publishing Transferred Assets, including any Shared Contract listed on Schedule 1.1(d)(iv) , the members of the Publishing Group shall no longer receive any benefits or have any obligations under any of the Shared Contracts. Effective as of the Distribution Date, other than as expressly provided in this Agreement or the Ancillary Agreements, the members of the Distributing Group shall no longer receive any benefits or have any obligations under any of the Shared Contracts included in the Publishing Transferred Assets, including any Shared Contract listed on Schedule 1.1(d)(iv) .
Section 2.3 Resignation . On or prior to the Distribution Date:
(a) Distributing shall deliver to Publishing the resignation or evidence of removal, effective as of the Distribution Date, of each Person who is an officer or a director of any member of the Publishing Group immediately prior to the Distribution Date and who will be an employee or officer of any member of the Distributing Group immediately after the Distribution Date; and
(b) Publishing shall deliver to Distributing the resignation or evidence of removal, effective as of the Distribution Date, of each Person who is an officer or a director of any member of the Distributing Group immediately prior to the Distribution Date and who will be an employee or officer of any member of the Publishing Group immediately after the Distribution Date.
ARTICLE III
CONDITIONS TO DISTRIBUTION
Section 3.1 Sole Discretion of Distributing . Notwithstanding anything to the contrary set forth in this Agreement or in any Ancillary Agreement, until the consummation of the Distribution:
(a) Distributing shall have the sole discretion to determine the Record Date, the Distribution Date and any and all terms of the Distribution, including the form, structure and terms of any transaction(s) or offering(s) to effect the Distribution and the timing of and conditions to the consummation of the Distribution; and
(b) Distributing, in its sole and absolute discretion, may at any time and from time to time, decide to abandon the Distribution, or modify or change the terms of the Distribution, including by accelerating or delaying the timing of the consummation of the Distribution.
 
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Section 3.2 Other Conditions to Distribution .
(a) The Conditions . The obligation of Distributing to consummate the Distribution is subject to the prior or simultaneous satisfaction, or waiver by Distributing, in its sole and absolute discretion, of each of the following conditions:
(i) the Distributing Board shall have given its final approval of the Distribution and all related transactions (and such approval shall not have been withdrawn, whether before or after declaration of the Distribution), and the Distributing Board shall have declared the Distribution, in each case, in its sole and absolute discretion;
(ii) the Business Separation and the other transactions contemplated by Article II shall have been consummated in accordance with this Agreement and the Implementation Documents;
(iii) Distributing shall have received a private letter ruling (the “ PLR ”) from the Internal Revenue Service in a form satisfactory to Distributing in its sole and absolute discretion, to the effect that, among other things, the relevant aspects of the Business Separation and Distribution will qualify for non-recognition of gain or loss to Distributing, Publishing and their respective stockholders, warrantholders and Subsidiaries under Sections 368(a)(1)(D), 355 and 361 of the Code, except to the extent of cash received in lieu of fractional shares, and such PLR shall not have been revoked or materially amended;
(iv) Distributing shall have received an opinion from Debevoise & Plimpton LLP, in form and substance satisfactory to Distributing in its sole and absolute discretion, that, subject to the accuracy of and compliance with certain representations, assumptions and covenants, the relevant aspects of the Business Separation and the Distribution will qualify for non-recognition of gain or loss to Distributing, Publishing and their respective stockholders, warrantholders and Subsidiaries pursuant to Sections 368(a)(1)(D), 355 and 361 of the Code, except to the extent of cash received in lieu of fractional shares;
(v) the Ancillary Agreements shall have been duly executed and delivered and such agreements shall be in full force and effect and the parties thereto shall have performed or complied with all of their respective covenants, obligations and agreements contained herein and therein and as required to be performed or complied with prior to the Distribution;
(vi) the Publishing Information Statement shall have been delivered to holders of Distributing Common Stock and Distributing Warrants as of the close of business on the Record Date (the “ Distributing Record Holders ”), which for purposes of this Section 3.2(a)(vi) includes electronic delivery where not prohibited by Law;
(vii) the actions and filings necessary or appropriate under applicable federal and state securities laws and state blue sky laws of the U.S. (and any comparable Laws under any foreign jurisdictions) in connection with the Distribution (including, if applicable, any actions and filings relating to the Publishing Information Statement) shall have been taken, and, where applicable, have become effective or been accepted, each as the case may be;
 
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(viii) the Parties shall have taken, or caused to be taken, all necessary actions so that, as of the Distribution Date, the officers and directors of Publishing will be as set forth in the Publishing Information Statement;
(ix) no order, injunction or decree issued by any Governmental Authority or other legal restraint or prohibition, which, if in effect, would prevent the consummation of the Transactions, materially limit the benefits of the Transactions for Distributing and the holders of Distributing Common Stock and Distributing Warrants, or otherwise make the consummation of the Transactions inadvisable as determined by the Distributing Board, shall have been threatened or be in effect; and
(x) no other events or developments shall have occurred, or failed to occur, subsequent to the date of this Agreement that, in the judgment of the Distributing Board, would prevent the consummation of the Transactions, materially limit the benefits of the Transactions for Distributing and the holders of Distributing Common Stock and Distributing Warrants, or otherwise make the consummation of the Transactions inadvisable as determined by the Distributing Board.
(b) Conditions for the Sole Benefit of Distributing . Each of the foregoing conditions is for the sole benefit of Distributing and not for the benefit of any other Person and shall not give rise to or create any duty on the part of Distributing or the Distributing Board to waive or not waive any such condition or in any way limit Distributing’s right to terminate this Agreement as set forth in Article XIII or alter the consequences of any such termination from those specified in Article XIII . Distributing may, in its sole and absolute discretion, determine whether to waive any such condition. Any determination made by Distributing, in its sole and absolute discretion, prior to the Distribution concerning the satisfaction or waiver of any or all of the conditions set forth in this Section 3.2 shall be conclusive and binding on the Parties.
ARTICLE IV
DISTRIBUTION
Section 4.1 Distribution . Upon the terms and subject to the conditions of this Agreement, on a date determined by the Distributing Board in its sole and absolute discretion, Distributing shall distribute all of its right, title and interest in and to 98.5% of the issued and outstanding Publishing Common Stock to the Distributing Record Holders on a pro rata basis, based on the number of shares of Distributing Common Stock and/or Distributing Warrants held by each Distributing Record Holder on the Record Date (the “ Distribution ” and, the date on which the Distribution occurs, the “ Distribution Date ”).
 
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ARTICLE V
GENERAL PROVISIONS
Section 5.1 Implementation Documents . In order to effectuate the Transactions, each of Distributing and Publishing and the applicable members of their respective Groups shall execute and deliver, or cause to be executed and delivered, such deeds, bills of sale, instruments of assumption, instruments of assignment, stock powers, certificates of title and other instruments of assignment, transfer, contribution, assumption, license and conveyance (collectively, the “ Implementation Documents ”) as and to the extent necessary to effect such transactions.
Section 5.2 Unreleased Liabilities . If at any time after the consummation of the Distribution, any member of the Distributing Group shall remain obligated to any Third Party in respect of any Publishing Liability or any member of the Publishing Group shall remain obligated to any Third Party in respect of any Distributing Liability, in each case, as guarantor, assignor, original tenant, primary obligor or otherwise, the following provisions shall apply. Any Liability referred to in this Section 5.2 is hereinafter referred to as an “ Unreleased Liability ” and any Person remaining obligated for such Liability is hereinafter referred to as an “ Unreleased Person .”
(a) Nothing in this Agreement shall release any Unreleased Person with respect to any obligation to any applicable Third Party for such Unreleased Liability to the extent provided in the relevant Contract, applicable Law or other source of such Unreleased Liability; provided , that such Unreleased Person shall be entitled to indemnification pursuant to Section 10.4 .
(b) The Parties shall continue on and after the Distribution Effective Time to use commercially reasonable efforts to cause each Unreleased Person to be released from each of its Unreleased Liabilities.
(c) If, as and when it becomes possible to delegate, novate or extinguish any Unreleased Liability in favor of an Unreleased Person, the relevant Party shall promptly execute and deliver, or cause to be promptly executed and delivered, all such documents and perform all such other acts, as may be necessary or desirable to give effect to such delegation, novation, extinction or other release without payment of any further consideration by the Unreleased Person.
Section 5.3 Deferred Transfers .
(a) If and to the extent that the transfer, assignment or novation to the Publishing Group of any Publishing Business Assets or Publishing Liabilities, or to the Distributing Group of any Distributing Business Assets or Distributing Liabilities, would be a violation of applicable Law or require any Consent or Governmental Approval or the fulfillment of any condition that cannot be fulfilled by the applicable member of the Publishing Group or the Distributing Group (the “ Transfer Impediments ,” which, for the avoidance of doubt, shall not include any purely monetary condition to the extent the necessary funds are advanced, assumed, or agreed in advance to be reimbursed by the applicable transferee), then the transfer, assignment or novation
 
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to the transferee or assignee of such Publishing Business Assets or Publishing Liabilities or Distributing Business Assets or Distributing Liabilities shall be automatically deemed deferred and any such purported transfer or assignment shall be null and void until such time as all Transfer Impediments have been removed. Any such Liability shall be deemed a “ Deferred Transfer Liability ” and any such Asset shall be deemed a “ Deferred Transfer Asset .”
(b) If the transfer or assignment of any Deferred Transfer Asset or assumption of any Deferred Transfer Liability is not consummated prior to or during the Distribution, whether as a result of the provisions of Section 5.3(a) or for any other reason, then, insofar as reasonably possible, ( i ) the Person retaining such Deferred Transfer Asset shall thereafter hold such Deferred Transfer Asset for the use and benefit of the Person entitled thereto (at the expense of the Person entitled thereto) and ( ii ) the Person intended to assume such Deferred Transfer Liability shall, or shall cause the applicable member of its Group to, pay or reimburse the Person retaining such Deferred Transfer Liability for all amounts paid or incurred in connection with the retention of such Deferred Transfer Liability. In addition, the Person retaining such Deferred Transfer Asset shall, insofar as reasonably possible and to the extent permitted by applicable Law, treat such Asset in the ordinary course of business in accordance with past practice and take such other actions as may be reasonably requested by the Person to which such Deferred Transfer Asset is to be transferred in order to place such Person, insofar as reasonably possible, in the same position as if such Deferred Transfer Asset had been transferred as contemplated hereby and so that all the benefits and burdens relating to such Deferred Transfer Asset, including, possession, use, risk of loss, potential for gain, and dominion, control and command over such Deferred Transfer Asset, are to inure from and after the Distribution Effective Time to the member or members of the Publishing Group or the Distributing Group entitled to the receipt of such Deferred Transfer Asset.
(c) If and when all Transfer Impediments which caused the deferral of transfer of any Deferred Transfer Asset or Deferred Transfer Liability pursuant to Section 5.3(a) are removed, the transfer, assignment or novation of the applicable Deferred Transfer Asset or Deferred Transfer Liability shall be effected promptly in accordance with and subject to the terms of this Agreement and any applicable Ancillary Agreement or Implementation Document.
(d) The Person retaining any Deferred Transfer Asset or Deferred Transfer Liability due to the deferral of the transfer or assignment of such Deferred Transfer Asset or the deferral of the assumption of such Deferred Transfer Liability pursuant to Section 5.3(a) or otherwise shall continue on and after the Distribution Effective Time to use commercially reasonable efforts to remove all Transfer Impediments; provided , that such Person shall not be obligated, in connection with the foregoing, to expend any money unless the necessary funds are advanced, assumed or agreed in advance to be reimbursed by the Person entitled to such Deferred Transfer Asset or the Person intended to be divested of such Deferred Transfer Liability.
(e) Any Deferred Transfer Asset shall be deemed to have been contributed, distributed, assigned, transferred, conveyed, licensed or delivered pursuant to this Section 5.3 at the time such transfer should have occurred pursuant to Section 2.1 in the absence of the Transfer Impediments upon its actual contribution, distribution, assignment, transfer, conveyance, license or delivery to the applicable Group as contemplated in Section 5.3 . Any Deferred Transfer Liability shall be deemed to have been accepted or assumed pursuant to this Section 5.3 at the time such assumption should have occurred pursuant to Section 2.1 in the absence of the Transfer Impediments upon its actual acceptance or assumption by the applicable Group as contemplated in Section 5.3 .
 
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(f) Any Deferred Transfer Asset or Deferred Transfer Liability shall be treated, for all Tax purposes, as ( i ) owned by the Person to which such Asset was intended to be transferred or by the Person which was intended to assume such Liability, as the case may be, from and after the Distribution Effective Time, ( ii ) having not been owned by the Person retaining such Asset or Liability, as the case may be, at any time from and after the Distribution Effective Time, and ( iii ) having been held by the Party retaining such Asset or Liability, as the case may be, only as agent or nominee on behalf of the other Person from and after the Distribution Effective Time until the date such Asset or Liability, as the case may be, is transferred to or assumed by such other Person. The Parties shall not, and shall cause the members of their respective Groups not to, take any position inconsistent with the foregoing unless otherwise required by applicable Law (in which case, such Parties shall provide indemnification for any Taxes attributable to the Asset or Liability during the period beginning on the Distribution Date and ending on the date of the actual transfer).
Section 5.4 Transfers of Assets or Liabilities Following the Distribution . Subject to Section 5.3 , if at any time during or after the consummation of the Distribution, any member of the Distributing Group or the Publishing Group shall receive or otherwise possess any Asset or incur any Liability that is allocated to a member of the other Group pursuant to this Agreement or an Ancillary Agreement, such Person shall, in accordance with the terms hereof, promptly transfer, or cause to be transferred, such Asset or Liability to the Person so entitled thereto or responsible therefor, and such other Person shall accept or assume, or cause to be accepted or assumed, such Asset or Liability (for no further consideration other than that set forth in this Agreement or such Ancillary Agreement). Prior to such transfer, such Asset or Liability shall be held in the same manner as Deferred Transfer Assets or Deferred Transfer Liabilities shall be held in accordance with Section 5.3 .
Section 5.5 Intellectual Property . Except as specifically provided in the Ancillary Agreements, after the Distribution Effective Time, no member of one Group may use any Intellectual Property owned by any member of the other Group, except as permitted under applicable Law or subsequent agreement in writing between the applicable parties. Notwithstanding the foregoing or anything in the Ancillary Agreements to the contrary, no member of one Group shall be required to take any action to remove any reference to any Mark of a member of the other Group from materials already in the rightful possession of customers or other Third Parties as of the Distribution Effective Time.
Section 5.6 Certain Matters Governed Exclusively by Ancillary Agreements .
(a) Effective on the Distribution Date, the Parties shall, and shall cause applicable members of their respective Groups to, execute and deliver the Ancillary Agreements.
(b) Each of Distributing and Publishing agrees on behalf of itself and members of its Group that, except as otherwise expressly provided for in this Agreement or any Ancillary Agreement, ( i ) the Tax Matters Agreement shall exclusively govern all matters relating to Taxes
 
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between such parties, including with respect to access and cooperation, ( ii ) the Employee Matters Agreement shall exclusively govern all matters relating to the separation of employees and other employee-related matters identified therein between such parties, including with respect to access and cooperation, and ( iii ) the other Ancillary Agreements shall exclusively govern those matters subject to such agreements.
Section 5.7 Disclaimer of Representations and Warranties .
(a) Distributing (on behalf of itself and each member of the Distributing Group) understands and agrees that, except as expressly set forth in any Ancillary Agreement, no party to this Agreement, any Ancillary Agreement or any other agreement or document contemplated by this Agreement, any Ancillary Agreement or otherwise, is representing or warranting in any way as to the Distributing Business Assets or Distributing Liabilities transferred, assumed or retained as contemplated hereby or thereby, as to any Consents or Governmental Approvals required in connection therewith, as to the value or freedom from any Encumbrances of, or any other matter concerning, any Distributing Business Asset or Distributing Liability, or as to the absence of any defense or right of setoff or freedom from counterclaim with respect to any claim or other Distributing Business Asset, including, any accounts receivable of any Person, or as to the legal sufficiency of any assignment, document or instrument delivered hereunder to convey title to any Distributing Business Asset or thing of value upon the execution, delivery and filing hereof or thereof.
(b) Publishing (on behalf of itself and each member of the Publishing Group) understands and agrees that, except as expressly set forth in any Ancillary Agreement, no party to this Agreement, any Ancillary Agreement or any other agreement or document contemplated by this Agreement, any Ancillary Agreement or otherwise, is representing or warranting in any way as to the Publishing Business Assets or Publishing Liabilities transferred, assumed or retained as contemplated hereby or thereby, as to any Consents or Governmental Approvals required in connection therewith, as to the value or freedom from any Encumbrances of, or any other matter concerning, any Publishing Business Asset or Publishing Liability, or as to the absence of any defense or right of setoff or freedom from counterclaim with respect to any claim or other Publishing Business Asset, including, any accounts receivable of any Person, or as to the legal sufficiency of any assignment, document or instrument delivered hereunder or thereunder to convey title to any Publishing Business Asset or thing of value upon the execution, delivery and filing hereof or thereof.
(c) EXCEPT AS MAY EXPRESSLY BE SET FORTH IN ANY ANCILLARY AGREEMENT, EACH PARTY (ON BEHALF OF ITSELF AND EACH OTHER MEMBER OF ITS GROUP) UNDERSTANDS AND AGREES THAT ALL ASSETS TRANSFERRED PURSUANT TO THIS AGREEMENT OR ANY ANCILLARY AGREEMENT ARE BEING TRANSFERRED “AS IS, WHERE IS.” EXCEPT AS MAY EXPRESSLY BE SET FORTH IN ANY ANCILLARY AGREEMENT, NONE OF THE PARTIES OR ANY OF THEIR AFFILIATES MAKES ANY REPRESENTATION OR WARRANTY, WHETHER EXPRESS, IMPLIED OR STATUTORY, AND EACH PARTY (ON BEHALF OF ITSELF AND ITS AFFILIATES) HEREBY DISCLAIMS ANY REPRESENTATION OR WARRANTY OF ANY KIND WITH RESPECT TO ANY ASSET TRANSFERRED PURSUANT TO THIS AGREEMENT OR ANY ANCILLARY AGREEMENT, INCLUDING, ANY WARRANTY OF CONDITION, MERCHANTABILITY, ACCURACY, SATISFACTORY QUALITY, NONINFRINGEMENT, OR FITNESS FOR ANY PARTICULAR PURPOSE.
 
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Section 5.8 Director and Officer Indemnification . For six (6) years from and after the Distribution Date, each of Distributing and Publishing shall cause the certificate of incorporation and bylaws (or equivalent organizational or governing documents) of each member of its Group to contain (and shall use commercially reasonable efforts to cause any member of its Group to cause its organizational or governing documents, after it ceases to be a member of its Group, to continue to contain) provisions with respect to the indemnification, exculpation or expense advancement of its current and former (as of the Distribution Date) directors and officers with respect to claims arising out of matters, acts or omissions occurring on or prior to the Distribution Date (whether commenced before or after the Distribution Date) that are no less favorable to such current and former directors and officers than the provisions set forth in the certificate of incorporation and bylaws (or equivalent organizational or governing documents) of such member of its Group as of the Distribution Date. Publishing shall obtain run-off “tail” insurance policies for its current and former (as of the Distribution Date) directors and officers who are currently covered by Distributing’s directors’ and officers’ liability insurance and/or fiduciary liability insurance policies in effect on the date of this Agreement with respect to claims arising during, or occurring or attributable to, the period on or prior to the Distribution Date, which has an effective term of six (6) years from the Distribution Date and contains terms that are no less favorable than those of Distributing’s directors’ and officers’ liability insurance and/or fiduciary liability insurance policies in effect on the date of this Agreement.
Section 5.9 Letters of Credit . Immediately following the Distribution Date, Publishing shall, ( a ) arrange for substitute letters of credit, Publishing guarantees and other obligations to replace any letters of credit, guarantees, surety bonds, performance bonds and other contractual obligations set forth on Schedule 5.9 (collectively, the “ Letters of Credit ”) that are outstanding as of immediately prior to the Distribution or ( b ) obtain from the applicable creditors or other counterparties full releases of the Letters of Credit. Publishing further agrees that to the extent that the beneficiary or counterparty under any such Letter of Credit does not accept any such substitute letter of credit, Publishing guarantee or other obligation proffered by Publishing, Publishing shall indemnify, defend and hold harmless Distributing against, and reimburse Distributing for, any and all amounts paid, including costs or expenses in connection with such Letter of Credit, including Distributing’s reasonable and documented out-of-pocket expenses in maintaining such Letter of Credit, whether or not any such Letter of Credit is drawn upon or required to be performed, and shall in any event promptly reimburse Distributing to the extent any such Letter of Credit is called upon and Distributing or any other member of the Distributing Group makes any payment or is obligated to reimburse the party issuing such Letter of Credit. With respect to any beneficiary in liquidation, other arrangements regarding expenses to maintain such Letter of Credit may be mutually agreed upon by Distributing and Publishing.
Section 5.10 Affiliate Agreement . Distributing shall use commercially reasonable efforts to maintain in effect the Amended and Restated CareerBuilder-Tribune Interactive Affiliate Agreement (as may be amended, modified or supplemented, the “ Modified Affiliate Agreement ”) for the benefit of Publishing for as long as possible to the extent permitted under the Modified Affiliate Agreement, provided that nothing in this Section 5.10 or in any Intercompany Agreement listed on Schedule 2.2(b)(ii) shall be deemed to ( a ) require Distributing
 
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to directly or indirectly acquire any additional shares of Publishing Common Stock or other equity interests of any member of the Publishing Group, ( b ) restrict any member of the Distributing Group from selling, transferring or otherwise disposing of all or any portion of its equity interests in CareerBuilder, LLC (“ CareerBuilder ”) or ( c ) supersede, modify or otherwise limit any rights of any member of the Distributing Group under any Contract that any member of the Distributing Group has entered into, or will enter into, with CareerBuilder or any other Contract relating to Distributing’s direct or indirect equity interests in CareerBuilder. The Parties shall, and shall cause applicable members of their respective Groups to, take any actions and perform any obligations with respect to the Modified Affiliate Agreement as agreed to by Distributing and Publishing.
ARTICLE VI
CONFIDENTIALITY; EXCHANGE OF INFORMATION
Section 6.1 Agreement for Exchange of Information; Archives .
(a) Except in the case of an Action or threatened Action by any Person in one Group against any Person in the other Group, and subject to Section 6.1(b) , each Party shall provide, or cause to be provided, to any other Party or any member of its Group, at any time before or after the Distribution Effective Time, as soon as reasonably practicable after written request therefor, all Information in the possession or under the control of its Group (and access to employees of its Group during normal business hours and upon reasonable notice in connection with the discussion and explanation of such Information), which any member of the other Party’s Group reasonably requests and is necessary ( i ) to comply with reporting, disclosure, filing or other requirements under applicable Law or imposed by any national securities exchange or any Governmental Authority having jurisdiction over such Person, ( ii ) for use in any other Action or in order to satisfy audit, accounting, regulatory, litigation or other similar requirements or ( iii ) to comply with its obligations under this Agreement or any Ancillary Agreement. The receiving Party shall use any Information received pursuant to this Section 6.1(a) solely to the extent reasonably necessary to satisfy the applicable obligations or requirements described in clause (i) , (ii)  or (iii)  of the immediately preceding sentence.
(b) Subject to the last sentence of this Section 6.1(b) , in the event that either Distributing or Publishing, as applicable, reasonably determines that the exchange of any Information pursuant to Section 6.1(a) could be commercially detrimental, violate any Law or agreement or waive or jeopardize any attorney-client privilege or attorney work product protection, such Party shall not be required to provide access to or furnish such Information to the other Party or any member of such other Party’s Group; provided , that the Parties shall take all commercially reasonable measures to permit the compliance with Section 6.1(a) in a manner that avoids any such harm or consequence. Both Distributing and Publishing intend that any provision of access to or the furnishing of Information pursuant to this Section 6.1 that would otherwise be within the ambit of any legal privilege shall not operate as waiver of such privilege.
(c) The Party requesting Information shall reimburse the other Party for the reasonable out-of-pocket costs and expenses, if any, in complying with a request for Information pursuant to this Article VI .
 
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Section 6.2 Ownership of Information . Except as otherwise provided in the Ancillary Agreements, all Information owned by one Group that is provided to the other Group hereunder shall be deemed to remain the property of the providing Person and nothing in this Article VI shall be construed as granting or conferring rights of license or otherwise in any such Information.
Section 6.3 Record Retention .
(a) To facilitate the possible exchange of Information pursuant to this Article VI and other provisions of this Agreement, except as otherwise expressly provided in any Ancillary Agreement, ( i ) each Party shall, and shall cause the members of its Group to, use commercially reasonable efforts to retain all Information in accordance with their respective record retention policies and procedures as in effect as of the Distribution Effective Time and ( ii ) no Party shall destroy, or permit any member of its Group to destroy, any Information which any member of the other Group may have the right to obtain pursuant to this Agreement prior to the earlier of the period in the retention policy of Distributing or the fifth (5th) anniversary of the Distribution Date without first providing the other Party with at least thirty (30) days’ prior notice of the proposed destruction and giving the other Party the opportunity to take possession of such Information prior to such destruction.
(b) Each of the Parties shall, and shall cause the members of its respective Group to, use commercially reasonable efforts to deliver to the other Party or the applicable members of such other Party’s Group ( i ) on or prior to the Distribution Date, any and all original organizational documents that such Party or any member of its Group has in its possession primarily relating to the Business of the other Party’s Group, ( ii ) on or prior to the Distribution Date, originals of any and all Records that any member of its Group knowingly has in its possession or control, whether in paper or electronic format, in each case relating primarily to the Business of the other Party’s Group, and ( iii ) at such other Party’s expense, as soon as reasonably practicable following their discovery, originals of any materials described in (i)  and (ii)  above which it or any member of its Group discovers are in its possession or control following the consummation of the Distribution; provided , that with respect to clauses (i) , (ii)  and (iii)  of this Section 6.3(b) , the Person providing such Records may retain copies of any such Records that relate to its Business.
Section 6.4 Production of Witnesses; Records; Cooperation .
(a) After the Distribution Date, but only with respect to a Third Party Claim, each of Distributing and Publishing shall, and shall cause the other members of its Group to, use commercially reasonable efforts to, make available, upon written request, their former, current and future directors, officers, employees, other personnel and agents (whether as witnesses or otherwise) and any books, records or other documents within their control or that they otherwise have the ability to make available, to the extent that each such Person (giving consideration to business demands of such directors, officers, employees, other personnel and agents) or books, records or other documents may reasonably be required in connection with any Action or threatened or contemplated Action (including preparation for such Action) in which any member of the Distributing Group or any member of the Publishing Group, as applicable, may from time to time be involved, regardless of whether such Action is a matter with respect to which indemnification may be sought hereunder. The requesting Person shall bear all out-of-pocket costs and expenses in connection therewith.
 
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(b) Distributing and Publishing shall, and shall cause the other members of its Group to, use their commercially reasonable efforts to cooperate and consult to the extent reasonably necessary with respect to any Actions or threatened or contemplated Actions involving each other’s Group, other than an Action against the other Group.
(c) The obligation of Distributing and Publishing to make available former, current and future directors, officers, employees and other personnel and agents or provide witnesses and experts pursuant to this Section 6.4 is intended to be interpreted in a manner so as to facilitate cooperation and shall, with respect to a Third Party Claim only, include the obligation to make available employees and other officers without regard to whether such individual or the employer of such individual could assert a possible business conflict. Without limiting the foregoing, each of Distributing and Publishing agrees that neither it nor any Person or Persons in its respective Group will take any adverse action against any Person of its Group based on such Person’s provision of assistance or information to the other Group pursuant to this Section 6.4 and in accordance with applicable Law and Third Party confidentiality obligations.
(d) Upon the reasonable request of the other Party, each Party shall, and shall cause all other relevant members of its respective Group to, enter into a mutually acceptable common interest agreement so as to maintain to the extent practicable any applicable attorney-client privilege or work product immunity of any member of either Group.
Section 6.5 Confidential Information .
(a) Subject to Section 6.6 , each of Distributing and Publishing, on behalf of itself and each Person in its respective Group, shall hold, and cause its and their respective Representatives to hold, in strict confidence and not release or disclose, with at least the same degree of care that it applies to its own confidential and proprietary information pursuant to policies in effect as of the Distribution Effective Time (but in no event less than a reasonable degree of care), all Information concerning the other Group or the Business of the other Group that is either in its possession (including Information in its possession prior to the Distribution) or furnished by the other Group or its respective Representatives at any time pursuant to this Agreement or any Ancillary Agreement or in connection with the Transactions (any such Information, subject to the following sentence, “ Confidential Information ”), and shall not use any such Confidential Information other than for such purposes as shall be expressly permitted hereunder or thereunder. Notwithstanding the foregoing, Confidential Information shall not include Information that is ( i ) in the public domain through no fault of any member of the Distributing Group or the Publishing Group, as applicable, or any of their respective Representatives, ( ii ) later lawfully acquired by any member of the Distributing Group or the Publishing Group, as applicable, or any of their respective Representatives, from other sources not known by the Publishing Group or the Distributing Group, as applicable, to be bound by a confidentiality obligation to the Publishing Group or the Distributing Group, as applicable, or ( iii ) independently developed by any member of the Distributing Group or the Publishing Group, as applicable, or any of their respective Representatives, without reference to any Confidential Information of the Distributing Group or the Publishing Group, as applicable. Notwithstanding the foregoing, ( A ) each Group may
 
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release or disclose, or permit to be released or disclosed, any such Confidential Information concerning the other Group to their Representatives who need to know such Confidential Information (who shall be advised of the obligations hereunder with respect to such Confidential Information); provided , that the Parties shall be responsible for any breach of this Article VI by the Representatives of their respective Group and ( B ) members of either Group may disclose Confidential Information to the extent required to fulfill their SEC filing obligations and shall not be required to comply with the procedures set forth in Section 6.6 with respect to such disclosure.
(b) Each Party shall maintain and develop, and shall cause the members of its respective Group to maintain and develop, such policies and procedures, necessary or appropriate, to ensure compliance with Section 6.5(a) .
(c) Without limiting the foregoing, when any Confidential Information concerning the other Group or its Business is no longer needed for the purposes contemplated by this Agreement or any Ancillary Agreement, each of Distributing and Publishing shall, and shall cause the members of its respective Group to, promptly after request of the other Party or the members of such other Party’s Group, either return such Confidential Information in tangible form (including all copies thereof and all notes, extracts or summaries based thereon) or certify to the other Party that it has destroyed such Confidential Information (other than electronic copies residing in automatic backup systems or one copy retained to the extent required by Law, regulation or a bona fide document retention policy).
Section 6.6 Protective Arrangement . If either Party or any member of its Group or any of its or their respective Representatives either determines on the advice of its counsel that it is required to disclose any Confidential Information pursuant to applicable Law or receives any demand under lawful process or from any Governmental Authority to disclose or provide Information of the other Party (or any member of such other Party’s Group), such first Party shall, or shall cause the applicable member of its Group to, or shall use commercially reasonable efforts to cause its Representatives to, give the other Party prompt, to the extent legally permitted and reasonably practicable, prior notice of such disclosure and an opportunity to contest such disclosure and shall use commercially reasonable efforts to cooperate, at the expense of the requesting Person, in seeking any reasonable protective arrangements requested by such Person. In the event that such appropriate protective order or other remedy is not obtained, the Person that is required to disclose such Information may furnish, or cause to be furnished, only that portion of such Confidential Information that is legally required to be disclosed and shall take commercially reasonable steps to ensure that confidential treatment is accorded such Information.
Section 6.7 Other Agreements Providing for Exchange of Information . The rights and obligations granted or created under this Article VI are subject to any specific limitations, qualifications or additional provisions on the sharing, exchange, retention or confidential treatment of Information set forth in any Ancillary Agreement.
Section 6.8 Privileged Matters . To allocate the interests of each Party in the Information as to which either Party is entitled to assert a privilege in connection with professional services that have been provided prior to the Distribution Effective Time for the collective benefit of each of the members of the Distributing Group and the members of the Publishing Group, whether or not such a privilege exists or the existence of which is in dispute, the Parties agree as follows:
 
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(a) Subject to Section 6.8(c) , the Distributing Group shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged Information which relates to the Distributing Business and not to the Publishing Business, whether or not the privileged Information is in the possession of or under the control of members of the Distributing Group or the Publishing Group. The Distributing Group also shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged Information which relates to any pending or future Action that is, or which the applicable member of the Distributing Group reasonably anticipates may become, a Distributing Liability and that is not also, or that the applicable member of the Distributing Group reasonably anticipates will not become, a Publishing Liability, whether or not the privileged Information is in the possession of or under the control of members of the Distributing Group or the Publishing Group.
(b) Subject to Section 6.8(c) , the Publishing Group shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged Information which relates to the Publishing Business and not to the Distributing Business, whether or not the privileged Information is in the possession of or under the control of members of the Distributing Group or the Publishing Group. The Publishing Group also shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged Information which relates to any pending or future Action that is, or which the applicable member of the Publishing Group reasonably anticipates may become, a Publishing Liability and that is not also, or that the applicable member of the Publishing Group reasonably anticipates will not become, a Distributing Liability, whether or not the privileged Information is in the possession of or under the control of members of the Distributing Group or the Publishing Group.
(c) Distributing shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged Information which relates to the Transactions, it being understood and agreed that the expectation and intention as between Distributing and Publishing with respect to any communications between advisors to Distributing and Publishing occurring up to and including the Distribution Date in connection with the Transactions are that the privilege and the expectation of client confidence belong exclusively to Distributing.
(d) Subject to the restrictions in this Section 6.8 , Distributing and Publishing agree that both Groups shall have equal right to assert all privileges not allocated pursuant to the terms of Section 6.8(a) , Section 6.8(b) or Section 6.8(c) with respect to Information as to which the members of both the Distributing Group and the Publishing Group may assert a privilege (“ Shared Privileges ”).
(e) Each Party shall ensure that no member of its Group may waive any Shared Privilege, without the written consent of the other Party or the applicable member of such other Party’s Group which shall not be unreasonably withheld or delayed.
 
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(f) In the event of an Action between one or more members of the Publishing Group, on the one hand, and one or more members of the Distributing Group, on the other hand, the applicable members of each Group shall have the right to use any Information that may be subject to a Shared Privilege, without obtaining the consent of the applicable members of the other Group, it being understood and agreed that the use of Information with respect to the Action or other dispute between the members of the Publishing Group, on the one hand, and the members of the Distributing Group, on the other hand, shall not operate as or be used by either Group as a basis for asserting a waiver of such Shared Privilege with respect to Third Parties.
(g) If a dispute arises between any member of the Publishing Group, on the one hand, and any member of the Distributing Group, on the other hand, regarding whether a Shared Privilege should be waived to protect or advance the interest of either Group, each Party agrees that it shall, and shall cause the members of its respective Group to, negotiate in good faith and endeavor to minimize any prejudice to the rights of the other Group, and shall not unreasonably withhold consent to any request for waiver by the other Group. Each Party specifically agrees that it shall, and shall cause the members of its respective Group to, not withhold consent to waiver for any purpose except to protect its own legitimate interests.
(h) Upon receipt by either Party or by any member of its Group of any subpoena, discovery or other request which arguably calls for the production or disclosure of Information subject to a Shared Privilege or as to which the other Party or a member of such other Party’s Group has the sole right hereunder to assert a privilege, or if either Party obtains knowledge that any of its Group’s current or former directors, officers, agents or employees have received any subpoena, discovery or other requests which arguably call for the production or disclosure of such privileged Information, such Party shall, and shall cause the members of its respective Group to, promptly notify the other Party or the applicable member of such other Party’s Group of the existence of the request and shall provide the other Party or the applicable member of such other Party’s Group a reasonable opportunity to review the Information and to assert any rights it or any member of its Group may have under this Section 6.8 or otherwise to prevent the production or disclosure of such privileged Information. Each Group shall bear its own expenses in connection with any such request.
(i) The transfer of all Records and other Information and each Group’s retention of Records and other Information which may include privileged Information of the other pursuant to this Agreement is made in reliance on the agreement of the Parties, as set forth in this Article VI , to, and to cause the members of their respective Groups to, maintain the confidentiality of the Information and to assert and maintain all applicable privileges. The access to Information being granted and the agreement to provide witnesses herein, the furnishing of notices and documents and other cooperative efforts contemplated hereby, and the transfer of privileged Information between and among the Parties and members of their respective Groups pursuant hereto shall not be deemed a waiver of any privilege that has been or may be asserted under this Agreement or otherwise.
 
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ARTICLE VII
FINANCIAL AND OTHER INFORMATION
Section 7.1 Financial and Other Information .
(a) During the period beginning on the Distribution Date and ending following a reasonable period of time after the end of the first full fiscal year following the Distribution Date as required for any member of either Group to prepare consolidated financial statements (including presenting the operations of the Publishing Business distributed as discontinued operations) or complete a financial statement audit for the fiscal year during which the Distribution Date occurs (the “ Overlapping Fiscal Year ”), each Party shall, and shall cause the members of its respective Group to, use its commercially reasonable efforts to cooperate with any requests from any member of the other Group, in each case to enable the requesting Person to meet its timetable for dissemination of its earnings releases and financial statements and to enable such requesting Person’s auditors to timely complete their integrated audit of the annual financial statements and internal control over financial reporting.
(b) During the Overlapping Fiscal Year, as soon as practicable, and in any event no later than the earlier of ( x ) thirty-five (35) days after the end of the applicable fiscal quarter, ( y ) five (5) days before Distributing is required to post, pursuant to the Plan of Reorganization, its existing financing instruments or, if applicable, SEC filing requirements, its quarterly financial statements and ( z ) five (5) days before Publishing publicly files its first quarterly report with the SEC that includes its consolidated financial statements for such fiscal quarter (the “ Publishing Quarterly Financial Statements ”), Publishing shall deliver to Distributing the substantially final draft of the Publishing Quarterly Financial Statements. Following such delivery, ( i ) Publishing and Distributing shall actively consult with each other regarding any changes (whether or not substantive) which Publishing may consider making to the Publishing Quarterly Financial Statements, with particular focus on any changes which would have any effect upon Distributing’s financial statements or related disclosures and ( ii ) Publishing shall deliver all material revisions to such drafts as soon as any such revisions are prepared or made. The substantially final draft (including any revisions resulting from the prior sentence) of the Publishing Quarterly Financial Statements shall be certified by the chief financial officer of Publishing as presenting fairly, in all material respects, the financial condition and results of operations of the Publishing Group.
(c) As soon as practicable, and in any event no later than the earlier of ( x ) sixty-five (65) days after the end of the applicable fiscal year, ( y ) ten (10) days before Distributing is required to post, pursuant to the Plan of Reorganization, its existing financing agreements or, if applicable, SEC filing requirements, its annual financial statements for the Overlapping Fiscal Year and ( z ) ten (10) days before Publishing publicly files its first annual report with the SEC that includes its audited consolidated financial statements for the Overlapping Fiscal Year (the “ Publishing Annual Financial Statements ”), Publishing shall deliver to Distributing the substantially final draft of the Publishing Annual Financial Statements. Following such delivery, ( i ) Publishing and Distributing shall actively consult with each other regarding any changes (whether or not substantive) which Publishing may consider making to the Publishing Annual Financial Statements, with particular focus on any changes which would have any effect upon
 
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Distributing’s financial statements or related disclosures and ( ii ) Publishing shall deliver all material revisions to such drafts as soon as any such revisions are prepared or made. The substantially final draft (including any revisions resulting from the prior sentence) of the Publishing Annual Financial Statements shall be certified by the chief financial officer of Publishing as presenting fairly, in all material respects, the financial condition and results of operations of the Publishing Group.
(d) With respect to Public Filings (as defined below) ( i ) by Distributing, until the date on which its annual financial statements for the Overlapping Fiscal Year are posted, and ( ii ) by Publishing, until the date on which the Publishing Annual Financial Statements are filed, Publishing and Distributing shall cooperate fully, and shall cause their respective accountants to cooperate fully, to the extent requested by the other, in the preparation of such other Person’s public earnings release, annual report on Form 10-K, annual financial statements, quarterly reports on Form 10-Q, quarterly financial statements, current reports on Form 8-K and other proxy, information and registration statements, reports, notices, prospectuses and filings made with the SEC or any national securities exchange or otherwise made publicly available (collectively, the “ Public Filings ”). Publishing and Distributing agree to provide each other all Information that the other reasonably requests in connection with any Public Filings or that, in either such Person’s judgment, is required to be disclosed or incorporated by reference therein under any Law. Such Information shall be provided by such Person in a timely manner to enable such other Person to prepare, print and release all Public Filings on such dates as such Person shall determine. Publishing and Distributing shall use their reasonable best efforts to cause their respective auditors to consent to any reference to them as experts in any Public Filings required under any Law. If and to the extent requested by either Publishing or Distributing, such other Person shall diligently and promptly review all drafts of such Public Filings.
(e) To the extent it relates to a pre-Distribution Effective Time period, Publishing and Distributing shall each authorize its respective auditors to make available to the other Party’s auditors both the personnel who performed or are performing the annual audit of the providing Party and work papers related to the annual audit of the providing Party, in all cases within a reasonable time prior to the opinion date of such other Party’s auditors, so that such other Party’s auditors are able to perform the procedures they consider necessary to take responsibility for the work of the providing Party’s auditors as it relates to such other Party’s auditors’ report on such other Party’s annual financial statements and internal control over financial reporting, all within sufficient time to enable such other Party to meet its timetable for the printing, filing and public dissemination of such other Party’s audited annual financial statements.
(f) To the extent it relates to a pre-Distribution Effective Time period, Publishing and Distributing shall each provide access to personnel and Records of members of its respective Group to the other Party’s auditors and management so that such other Party may conduct reasonable audits relating to the financial statements provided by the providing Party pursuant to the provisions of this Section 7.1 .
(g) To the extent it relates to a pre-Distribution Effective Time period, ( i ) each of the Parties shall give the other Party as much prior notice as is reasonably practicable of any changes to, or proposed determination of, its accounting estimates or accounting principles from those in effect as of immediately prior to the Distribution Effective Time or of any other action with
 
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regard to its accounting estimates or accounting principles or previously reported financial results which may affect the other Party’s financial results, ( ii ) each of the Parties will consult with the other and, if requested by the Party contemplating such changes, with such Party’s auditors and ( iii ) unless required by generally accepted accounting principles, Law or a Governmental Authority, Publishing shall not make such determination or changes which would affect Distributing’s previously reported financial results without Distributing’s prior written consent, which shall not be unreasonably withheld. Further, Publishing will give Distributing prompt notice of any amendments or restatements of accounting statements with respect to the pre-Distribution Effective Time period, and will provide Distributing with access as provided in Article VII as promptly as possible such that Distributing will be able to satisfy its financial reporting requirements.
(h) Until the end of the Overlapping Fiscal Year, Publishing shall, and shall cause each member of its Group to, maintain a fiscal year that commences and ends on the same calendar days as Distributing’s fiscal year commences and ends, and to maintain monthly accounting periods that commence and end on the same calendar days as Distributing’s monthly accounting periods commence and end.
(i) Each Party agrees and acknowledges, on behalf of itself and members of its Group, that it is aware and will advise its Representatives who receive information provided hereunder and are otherwise not aware, that ( i ) the information provided hereunder may contain material, non-public information concerning the other Party or member of such other Party’s Group and ( ii ) United States securities laws prohibit any person who has material non-public information concerning a publicly traded Person from purchasing or selling securities of such Person, or from communicating such information to any other Person under circumstances in which it is reasonably foreseeable that such Person is likely to purchase or sell such securities.
Section 7.2 Sarbanes-Oxley Section 404 Compliance . Following the Distribution, Distributing shall continue to provide access to the applicable members of the Publishing Group and, to the extent applicable as determined by Distributing’s registrant status with the SEC, Publishing shall continue to provide access to the applicable members of the Distributing Group, in each case, on a timely basis to all Information reasonably required to meet each such member’s schedule for management’s assessment of the effectiveness of its disclosure controls and procedures and its internal control over financial reporting in accordance with Items 307 and 308, respectively, of Regulation S-K and, to the extent applicable to such Group, its auditor’s audit of its internal control over financial reporting and management’s assessment thereof in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 and the SEC’s and Public Company Accounting Oversight Board’s rules and auditing standards thereunder (such assessments and audit being referred to as the “ Internal Control Audit and Management Assessments ”). Without limiting the generality of the foregoing, Distributing and, to the extent applicable as determined by Distributing’s registrant status with the SEC, Publishing will provide all required financial and other Information with respect to itself and members of its respective Group (including access to personnel and Records) to the auditors and management of the applicable members of the other Group in a sufficient and reasonable time and in sufficient detail to permit such auditors and management to complete the Internal Control Audit and Management Assessments.
 
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ARTICLE VIII
INSURANCE
Section 8.1 Insurance Matters .
(a) Publishing does hereby, for itself and each other member of the Publishing Group, agree that no member of the Distributing Group or any Distributing Indemnified Party shall have any liability whatsoever as a result of the insurance policies and practices of the Distributing Group as in effect at any time prior to the Distribution Effective Time, including as a result of the level or scope of any such insurance, the creditworthiness of any insurance carrier, the terms and conditions of any policy, the adequacy or timeliness of any notice to any insurance carrier with respect to any claim or potential claim or otherwise, any professional or other advice with respect to the initial policies for Publishing, any handling of claims for Publishing, or any oversight or advice with respect to risk management or other insurance-related issues; provided , that this Section 8.1(a) shall not negate Distributing’s agreement under Section 8.1(b) .
(b) Distributing acknowledges that Publishing and the other members of the Publishing Group as of the Distribution Effective Time have or may have certain interests and rights as insureds or beneficiaries or in other capacities under occurrence-based insurance policies and programs (and under claims-made policies and programs but only to the extent that a claim has been properly noticed thereunder prior to the Distribution Effective Time) of Distributing or a member of the Distributing Group in respect of the period prior to the Distribution Effective Time, and that those interests and rights survive the Distribution Effective Time; provided , that the interests and rights of Publishing and the other members of the Publishing Group shall be subject to the terms and conditions of such insurance policies and programs, including any limits on coverage or scope, any deductibles and other fees and expenses and Distributing’s allocation of the cost of claims to its business units, including Publishing, according to any allocation program in effect as of the Distribution Effective Time, and shall be subject to the following additional conditions:
(i) Publishing shall report to the applicable insurance carriers, on behalf of itself and other members of the Publishing Group, as promptly as practicable claims in accordance with the Distributing Group’s claim reporting procedures in effect immediately prior to the Distribution Effective Time (or in accordance with any modifications to such procedures after the Distribution Effective Time communicated by Distributing to Publishing in writing);
(ii) Publishing and the other members of the Publishing Group shall indemnify, hold harmless and reimburse Distributing and the other members of the Distributing Group for any premiums, retrospectively rated premiums, defense costs, indemnity payments, deductibles, retentions, claim expenses and claim handling fees or other charges allocated to members of the Publishing Group pursuant to any allocation program maintained by the Distributing Group in effect as of the Distribution Effective Time; and
 
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(iii) Publishing shall, and shall cause other members of the Publishing Group to, cooperate and assist with Distributing and other members of the Distributing Group and share such information as is reasonably necessary in order to permit Distributing and members of the Distributing Group to manage and conduct the insurance matters contemplated by this Article VIII , including, without limitation, the production of witnesses in accordance with Section 6.4 ;
provided that, for the avoidance of doubt, nothing in this Section 8.1(b) shall require Distributing to report any claims, or otherwise act as an intermediary, on behalf of Publishing with respect to any insurance policies for which Publishing has the ability to make claims directly to the applicable insurance carrier pursuant to such policies and any proceeds received by Distributing or any other member of the Distributing Group after the Distribution Effective Time under such policies and programs in respect of Publishing and the other members of the Publishing Group shall be for the benefit of Publishing and the other members of the Publishing Group.
(c) Subject to Section 8.1(b) , Distributing and other members of the Distributing Group shall retain the exclusive right to control their insurance policies and programs, including the right to defend, exhaust, settle, release, commute, buy-back or otherwise resolve disputes with respect to any of their insurance policies and programs and to amend, modify or waive any rights under any such insurance policies and programs, notwithstanding whether any such policies or programs apply to any Publishing Liabilities and/or claims Publishing has made or could make in the future, and no member of the Publishing Group shall, without the prior written consent of Distributing, erode, exhaust, settle, release, commute, buy-back or otherwise resolve disputes with insurers of Distributing or other members of the Distributing Group with respect to any of the insurance policies and programs of the Distributing Group, or amend, modify or waive any rights under any such insurance policies and programs. Neither Distributing nor any other members of the Distributing Group shall have any obligation to secure extended reporting for any claims under any of the insurance policies and programs of Distributing or other members of the Distributing Group for any acts or omissions by any member of the Publishing Group incurred prior to the Distribution Effective Time.
(d) This Agreement is not intended as an attempted assignment of any policy of insurance or as a contract of insurance and shall not be construed to waive any right or remedy of any member of the Publishing Group in respect of any insurance policy or any other contract or policy of insurance.
(e) Nothing in this Agreement shall be deemed to restrict any member of the Publishing Group from acquiring at its own expense any insurance policy in respect of any Liabilities or covering any period.
Section 8.2 Miscellaneous . Each of the Parties intends by this Agreement that a Third Party, including a third-party insurer or reinsurer, or other Third Party that, in the absence of the Agreement would otherwise be obligated to pay any claim or satisfy any indemnity or other obligation, shall not be relieved of the responsibility with respect thereto and shall not be entitled to a “windfall” (i.e., avoidance of the obligation that such Person would have in the absence of this Agreement). To the extent that any such Person would receive such a windfall, the Parties shall negotiate in good faith concerning an amendment of this Agreement to avoid such a windfall.
 
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ARTICLE IX
LEGAL MATTERS
Section 9.1 Control of Legal Matters .
(a) At all times from and after the Distribution Effective Time, Publishing shall assume (or, as applicable, retain) control of each of the Publishing Litigation Matters (including those matters set forth on Schedule 9.1(a) ), and Publishing shall use its reasonable best efforts to cause any member of the Distributing Group named as a defendant in any such Publishing Litigation Matter to be removed and dismissed from such Publishing Litigation Matter; provided , that Publishing shall not be required to make any such effort if the removal of any member of the Distributing Group would jeopardize insurance coverage or rights to indemnification from Third Parties applicable to such Publishing Litigation Matter.
(b) At all times from and after the Distribution Effective Time, Distributing shall assume (or, as applicable, retain) control of each of the Distributing Litigation Matters (including those matters set forth on Schedule 9.1(b) ), and Distributing shall use its reasonable best efforts to cause any member of the Publishing Group named as a defendant in any such Distributing Litigation Matter to be removed and dismissed from such Distributing Litigation Matter; provided , that Distributing shall not be required to make any such effort if the removal of any member of the Publishing Group would jeopardize insurance coverage or rights to indemnification from Third Parties applicable to such Distributing Litigation Matter.
(c) To the extent a Party is unable to cause a member of the other Party’s Group to be removed and dismissed pursuant to Section 9.1(a) or (b) , the Parties agree to cooperate in defending against such Action and, subject to Section 6.8 , to provide each other with access to all Information relating to such Action except to the extent that providing such access and such Information would prejudice an indemnification claim available to such Party or a member of such Party’s Group as contemplated in Article X .
(d) At all times from and after the Distribution Effective Time, the Parties shall jointly control any Joint Litigation Matter and shall cooperate in defending against such Action; provided , that no member of either Group may settle a Joint Litigation Matter without the prior written consent of the members of the other Group named or involved in such Joint Litigation Matter, which consent shall not be unreasonably withheld or delayed; and provided , further , that either Party may settle a Joint Litigation Matter if such settlement is for monetary relief only and such Party provides a full release from, or indemnity for, any liability under such Joint Litigation Matter for the other Party and, as applicable, the members of the other Party’s Group and their respective Representatives.
Section 9.2 Notice to Third Parties; Service of Process; Cooperation .
(a) The Parties shall, and shall cause the members of their respective Groups to, promptly notify their respective agents for service of process and all other necessary Persons, including plaintiffs and courts, of the Distribution and shall provide instructions for proper service of legal process and other documents.
 
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(b) The Parties shall, and shall cause the members of their respective Groups to, use their reasonable best efforts to deliver to each other any legal process or other documents incorrectly served upon them or their agents as soon as possible following receipt.
(c) If either Party or any members of its Group receives notice or otherwise learns of the assertion of a Joint Litigation Matter, such Party or member of such Party’s Group shall give the other Party or the applicable members of such other Party’s Group written notice of such Joint Litigation Matter in reasonable detail. The failure to give notice under this subsection shall not relieve either Party (or any member of its Group) of its Liability for any Joint Litigation Matter as provided hereunder or under any Ancillary Agreement, except to the extent such Party is actually prejudiced by the failure to give such notice. The Parties and the members of their respective Groups shall be deemed to be on notice of any Joint Litigation Matter pending prior to the Distribution Effective Time.
Section 9.3 Bankruptcy Proceedings .
(a) The payment or satisfaction of any Bankruptcy Indemnification Claim that becomes an Allowed Claim shall in all respects be and remain subject to the terms of the Plan of Reorganization, including, without limitation, the rights of the Litigation Trust (as defined in the Plan of Reorganization) to setoff certain amounts against any Bankruptcy Indemnification Claims that become Allowed Claims as set forth in Section 7.11.2 of the Plan of Reorganization.
(b) The allocation of responsibility in this Agreement for claims asserted in the Bankruptcy Proceedings, including the Bankruptcy Indemnification Claims, shall not change the entity against which an Action may ultimately become an Allowed Claim in the Bankruptcy Proceedings.
(c) Each Party agrees that it shall prepare and submit quarterly reports to the Office of the United States Trustee for all legal entities in its Group that have chapter 11 cases remaining open before the United States Bankruptcy Court for the District of Delaware. Each Party further agrees that it shall be solely responsible for the payment of quarterly fees to the Office of the United States Trustee for all legal entities in its Group.
(d) Distributing (acting as a Disbursing Agent as defined in the Plan of Reorganization) shall pay, or cause to be paid, from the Subsidiary GUC Reserve (as defined in the Plan of Reorganization) to Publishing or to the underlying claimant(s) an amount equal to the amount that one or more members of the Publishing Group are directed to pay pursuant to the terms of a final, non-appealable order, decree, judgment or ruling of a court of competent jurisdiction in respect of the Action set forth on Schedule 9.3(d) , up to the amount set forth on Schedule 9.3(d) .
 
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ARTICLE X
INDEMNIFICATION
Section 10.1 Release of Pre-Separation Claims .
(a) Except as provided in Section 10.1(c) , effective as of the Distribution Effective Time, Publishing does hereby, for itself and each other Publishing Indemnified Party, remise, release and forever discharge each Distributing Indemnified Party, from any and all Liabilities whatsoever, whether at Law or in equity (including any right of contribution), whether arising under any contract or agreement, by operation of Law or otherwise, existing or arising from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur or any conditions existing or alleged to have existed on or before the Distribution Effective Time, including in connection with the Transactions and all other activities to implement the Transactions.
(b) Except as provided in Section 10.1(c) , effective as of the Distribution Effective Time, Distributing does hereby, for itself and each other Distributing Indemnified Party, remise, release and forever discharge each Publishing Indemnified Party, from any and all Liabilities whatsoever, whether at Law or in equity (including any right of contribution), whether arising under any contract or agreement, by operation of Law or otherwise, existing or arising from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur or any conditions existing or alleged to have existed on or before the Distribution Effective Time, including in connection with the Transactions and all other activities to implement the Transactions.
(c) Nothing contained in Section 10.1(a) or Section 10.1(b) shall impair any right of any Person to enforce this Agreement (including Section 10.2 , Section 10.3 and Section 10.4 ), any Ancillary Agreement or any other Intercompany Agreements or Intercompany Accounts that are specified in Section 2.2(b) as not to terminate as of the Distribution Effective Time, in each case in accordance with its terms. For the avoidance of doubt, nothing contained in Section 10.1(a) or Section 10.1(b) shall release any Person from:
(i) any Liability provided in or resulting from any agreement among any members of the Distributing Group or the Publishing Group that is specified in Section 2.2(b) as not to terminate as of the Distribution Effective Time, or any other Liability specified in such Section 2.2(b) as not to terminate as of the Distribution Effective Time;
(ii) any Liability, contingent or otherwise, assumed, transferred, assigned or allocated to the Group of which such Person is a member in accordance with, or any other Liability of any member of any Group under, this Agreement or any Ancillary Agreement;
(iii) any Liability provided in or resulting from any other agreement or understanding that is entered into on or after the Distribution Date between one Party (or a member of such Party’s Group), on the one hand, and the other Party (or a member of such Party’s Group), on the other hand;
 
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(iv) any Liability that the Parties may have with respect to indemnification or contribution pursuant to this Agreement or any Ancillary Agreement;
(v) any Liability the release of which would result in the release of any Person other than a Distributing Indemnified Party or a Publishing Indemnified Party intended to be released pursuant to this Section 10.1 ; provided , that the Parties agree not to bring suit, or permit any other member of their respective Groups to bring suit, against such Distributing Indemnified Party or Publishing Indemnified Party with respect to any such Liability that shall otherwise be released pursuant to this Section 10.1 in the absence of this subsection (v); or
(vi) any obligation existing prior to the Distribution Effective Time of any member of a Group to indemnify any Person who has been a Representative of any member of the Group at any time on or prior to the Distribution Effective Time.
(d) Publishing shall not make, and shall not permit any other member of the Publishing Group to make, any claim or demand, or commence any Action asserting any claim or demand, including any claim of contribution or any indemnification, against Distributing or any other member of the Distributing Group, or any other Person released pursuant to Section 10.1(a) , with respect to any Liabilities released pursuant to Section 10.1(a) . Distributing shall not make, and shall not permit any other member of the Distributing Group to make, any claim or demand, or commence any Action asserting any claim or demand, including any claim of contribution or any indemnification against Publishing or any other member of the Publishing Group, or any other Person released pursuant to Section 10.1(b) , with respect to any Liabilities released pursuant to Section 10.1(b) .
(e) It is the intent of each Party, by virtue of the provisions of this Section 10.1 , to provide for a full and complete release and discharge of all Liabilities existing or arising from all acts and events occurring or failing to occur or alleged to have occurred or to have failed to occur and all conditions existing or alleged to have existed on or before the Distribution Effective Time, between or among any member of the Publishing Group, on the one hand, and any member of the Distributing Group, on the other hand (including any contractual agreements or arrangements existing or alleged to exist between or among any such members on or before the Distribution Effective Time), except as otherwise set forth in Section 10.1(c) . At any time, at the request of the other Party, each Party shall, no later than the fifth (5th) day following the receipt of such request, cause each member of its respective Group to execute and deliver releases reflecting the provisions hereof.
Section 10.2 Indemnification by Publishing . Following the Distribution Effective Time and subject to Section 14.1 and the provisions in the Intercompany Leases (it being agreed that to the extent that any provision contained in any Intercompany Lease conflicts or is inconsistent with this Agreement (including this Article X ), the provisions of such Intercompany Lease shall be controlling, except with respect to any Liabilities specifically designated as Publishing Assumed Liabilities on Schedule 1.1(c) , in which case, this Agreement shall be controlling), Publishing shall, and shall cause the members of the Publishing Group to, indemnify, defend and hold harmless each member of the Distributing Group and its Affiliates, and each of their respective current or former stockholders, members, directors, officers, employees, agents, and
 
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each of the heirs, executors, administrators, successors and assigns of any of the foregoing, in each case, in their respective capacities as such (each, a “ Distributing Indemnified Party ”), from and against any and all Liabilities actually incurred or suffered by the Distributing Indemnified Parties to the extent relating to, arising out of or resulting from one or more of the following:
(a) each Publishing Liability, Publishing Business Asset or the Publishing Business (other than any Distributing Assumed Liability), whether arising prior to, on or after the Distribution Date;
(b) the failure of any member of the Publishing Group or any other Person to pay, perform or otherwise promptly discharge any Publishing Liability or any Contract included in the Publishing Business Assets in accordance with their respective terms, whether arising prior to, on or after the Distribution Date;
(c) each breach by any member of the Publishing Group of this Agreement; and
(d) each breach by any member of the Publishing Group of an Ancillary Agreement, subject to any specific limitation on liability contained in such Ancillary Agreement and without duplication of the performance by each member of the Publishing Group of any indemnification obligations in such Ancillary Agreement; provided that to the extent that any indemnification provision contained in any Ancillary Agreement conflicts or is inconsistent with this Article X , the indemnification provisions of such Ancillary Agreement shall be controlling.
Section 10.3 Indemnification by Distributing . Following the Distribution Effective Time and subject to Section 14.1 and the provisions in the Intercompany Leases (it being agreed that to the extent that any provision contained in any Intercompany Lease conflicts or is inconsistent with this Agreement (including this Article X ), the provisions of such Intercompany Lease shall be controlling, except with respect to any Liabilities specifically designated as Publishing Assumed Liabilities on Schedule 1.1(c) , in which case, this Agreement shall be controlling), Distributing shall, and shall cause the other members of the Distributing Group to, indemnify, defend and hold harmless each member of the Publishing Group and its Affiliates, and each of their respective current or former stockholders, members, directors, officers, employees, agents, and each of the heirs, executors, administrators, successors and assigns of any of the foregoing, in each case, in their respective capacities as such (each, a “ Publishing Indemnified Party ”), from and against any and all Liabilities actually incurred or suffered by the Publishing Indemnified Parties to the extent relating to, arising out of or resulting from one or more of the following:
(a) each Distributing Liability, Distributing Business Asset or the Distributing Business (other than any Publishing Assumed Liability), whether arising prior to, on or after the Distribution Date;
(b) the failure of any member of the Distributing Group or any other Person to pay, perform or otherwise promptly discharge any Distributing Liability or any Contract included in the Distributing Business Assets in accordance with their respective terms, whether arising prior to, on or after the Distribution Date;
(c) each breach by any member of the Distributing Group of this Agreement; and
 
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(d) each breach by any member of the Distributing Group of an Ancillary Agreement, subject to any specific limitation on liability contained in the Ancillary Agreement and without duplication of the performance by each member of the Distributing Group of any indemnification obligations in the Ancillary Agreement; provided that to the extent that any indemnification provision contained in any Ancillary Agreement conflicts or is inconsistent with this Article X , the indemnification provisions of such Ancillary Agreement shall be controlling.
Section 10.4 Indemnification with respect to Unreleased Liabilities . Without limiting the generality of Sections 10.2 and 10.3 , Distributing shall, and shall cause the other members of the Distributing Group to, indemnify, defend and hold harmless each Publishing Indemnified Party that is an Unreleased Person against any Liabilities arising in respect of each Unreleased Liability of such Person, and Publishing shall, and shall cause the other members of the Publishing Group to, indemnify, defend and hold harmless each Distributing Indemnified Party that is an Unreleased Person against any Liabilities arising in respect of each Unreleased Liability of such Person. Distributing and Publishing shall take, and shall cause the members of their respective Groups to take, such other actions as may be reasonably requested by the other Party (or any relevant member of its Group) in accordance with the provisions of this Agreement in order to place Distributing and Publishing (and any relevant member of their respective Groups), insofar as reasonably possible, in the same position as they would be in if such Unreleased Liability had been fully contributed, assigned, transferred, conveyed, and delivered to, and accepted and assumed or retained, as applicable, by the other Party (or any relevant member of its Group) with effect as of the Distribution Effective Time and so that all the benefits and burdens relating to such Unreleased Liability, including possession, use, risk of loss, potential for gain, and dominion, control and command over such Unreleased Liability, are to inure from and after the Distribution Effective Time to the member or members of the Distributing Group or the Publishing Group, as the case may be.
Section 10.5 Indemnification Obligations Net of Third Party Proceeds and Other Amounts .
(a) The Parties intend that each Liability subject to indemnification, contribution or reimbursement pursuant hereto will be net of ( i ) all monies received by an insured or reinsured from an insurer or reinsurer, ( ii ) all monies paid by an insurer or reinsurer on behalf of the insured or reinsured and ( iii ) all recoveries, judgments, settlements, contribution, indemnities and other amounts received (including by way of set-off) from all Third Parties, in each case that actually reduce the amount of, or are paid to the applicable indemnitee in respect of, such Liability and net of ( x ) any applicable premium adjustments (including, retrospectively rated premium adjustments), ( y ) any self-insured retention, deductible or other form of self-insurance and ( z ) any Third Party costs or expenses incurred in the collection thereof (the proceeds received pursuant to this sentence, collectively “ Third Party Proceeds ”). Accordingly, the amount that either Party and any member of its respective Group (each an “ Indemnifying Party ”) is required to pay to each Person entitled to indemnification hereunder (each an “ Indemnified Party ”) shall be reduced by all Third Party Proceeds received by or on behalf of the Indemnified Party in respect of the relevant Liability; provided , that all amounts described in Section 10.2 or Section 10.3 which are incurred by an Indemnified Party shall be paid promptly by the Indemnifying Party and shall not be delayed pending any determination as to the availability of Third Party Proceeds; and provided , further , that upon such payment by or on behalf of an
 
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Indemnifying Party to an Indemnified Party in connection with a Third Party Claim, to the extent permitted by applicable Laws such Indemnified Party shall assign its rights to recover all Third Party Proceeds to the Indemnifying Party and such Indemnifying Party shall be subrogated to and shall stand in the place of such Indemnified Party as to all events and circumstances in respect of which such Indemnified Party may have with respect to all rights, defenses, and claims relating to such Third Party Claim. If, notwithstanding the second proviso in the preceding sentence, an Indemnified Party receives a payment required to be made under this Article X (an “ Indemnity Payment ”) from an Indemnifying Party in respect of a Liability and subsequently receives Third Party Proceeds in respect of such Liability, then the Indemnified Party shall pay to the Indemnifying Party an amount equal to the excess of the amount paid by the Indemnifying Party over the amount that would have been due if such Third Party Proceeds had been received before the Indemnity Payment was made. Each member of the Distributing Group and each member of the Publishing Group shall use commercially reasonable efforts to seek to collect or recover all Third Party Proceeds to which such Person is entitled in respect of a Liability for which such Person seeks indemnification pursuant to this Article X ; provided , that such Person’s inability to collect or recover any such Third Party Proceeds shall not limit the Indemnifying Party’s obligations hereunder unless such inability is a result of such Person’s failure to exercise commercially reasonable efforts to so collect and recover any such Third Party Proceeds.
(b) An insurer that would otherwise be obligated to pay a claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or other third party shall be entitled to a “windfall” (i.e., a benefit it would not be entitled to receive in the absence of the indemnification provisions hereof) by virtue of the indemnification provisions hereof. Without limiting the generality of the foregoing and for the avoidance of doubt, insofar as any insurer is only obligated to pay a claim after the prior exhaustion of any other rights of indemnification, the indemnification provided under this Article X shall not be available to the extent, but only to the extent, that such indemnification would otherwise relieve such insurer of its payment obligation.
Section 10.6 Contribution . If the indemnification provided for in this Article X is unavailable to, or insufficient to hold harmless, an Indemnified Party in respect of a Liability for which indemnification is provided for herein then each Indemnifying Party shall, in lieu of indemnifying such Indemnified Party, contribute to the amount paid or payable by such Indemnified Party as a result of such Liability, in such proportion as shall be sufficient to place the Indemnified Party in the same position as if such Indemnified Party were indemnified hereunder. If the contribution provided for in the previous sentence shall, for any reason, be unavailable or insufficient to put the Indemnified Party in the same position as if it were indemnified under Section 10.2 or Section 10.3 , as the case may be, then the Indemnifying Party shall contribute to the amount paid or payable by such Indemnified Party as a result of such Liability, in such proportion as shall be appropriate to reflect the relative benefits received by and the relative fault of the Indemnifying Party, on the one hand, and the Indemnified Party, on the other hand, with respect to the matter giving rise to the Liability.
Section 10.7 Procedures for Indemnification of Direct Claims . Each claim for indemnification made directly by the Indemnified Party against the Indemnifying Party that does not result from a Third Party Claim shall be asserted by written notice from the Indemnified
 
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Party to the Indemnifying Party specifically claiming indemnification hereunder, which notice shall state the amount claimed, if known, and method of computation thereof, and shall contain a reference to the provisions of this Agreement in respect of which such right of indemnification is claimed by such Indemnified Party. Such Indemnifying Party shall have a period of thirty (30) days after the receipt of such notice within which to respond thereto. If such Indemnifying Party does not respond within such thirty (30) day period, such Indemnifying Party shall be deemed to have accepted responsibility for the indemnification sought and shall have no further right to contest the validity of such claim. If such Indemnifying Party does respond within such thirty (30) day period and rejects such claim in whole or in part, such Indemnified Party shall be free to pursue resolution as provided in Article XI .
Section 10.8 Procedures for Indemnification of Third Party Claims .
(a) If an Indemnified Party shall receive notice of the assertion of a claim, or commencement of an Action, by a Third Party against it (each, a “ Third Party Claim ”) that may give rise to a claim for indemnification pursuant to this Agreement, within thirty (30) days of the receipt of such notice, the Indemnified Party shall give the Indemnifying Party notice of such Third Party Claim, which notice shall describe such Third Party Claim in reasonable detail; provided , that the failure to provide such notice as provided in this Section 10.8 shall not release the Indemnifying Party from any of its obligations under this Article X except to the extent such Indemnifying Party is actually prejudiced by such failure to give notice.
(b) Each Indemnifying Party shall be entitled (but shall not be required) to assume and control the defense of each Third Party Claim at its expense and through counsel of its choice that is reasonably acceptable to the Indemnified Party if it gives notice of its intention to do so to the Indemnified Party within thirty (30) days of the receipt of notice from the Indemnified Party in accordance with Section 10.8(a) ; provided , that the Indemnifying Party shall not, without the prior written consent of the Indemnified Party, settle, compromise or offer to settle or compromise such Third Party Claim; and provided , further , that such Indemnified Party shall not withhold such consent if the settlement or compromise ( i ) contains no finding or admission of a violation of Law or a violation of the rights of a Person by the Indemnified Party or any of its Affiliates, ( ii ) contains no finding or admission that would have an adverse effect on the Indemnified Party or any of its Affiliates as determined by the Indemnified Party in good faith, ( iii ) involves only monetary relief which the Indemnifying Party has agreed to pay and does not contain an injunction or other non-monetary relief affecting the Indemnified Party or any of its Affiliates and ( iv ) includes a full, irrevocable unconditional release of the Indemnified Party from such Third Party Claim.
(c) If the Indemnifying Party elects to undertake the defense against a Third Party Claim as provided by Section 10.8(b) , the Indemnified Party shall cooperate with the Indemnifying Party with respect to such defense and shall have the right, but not the obligation, to participate in such defense and to employ separate counsel of its choosing at its own expense; provided , that such expense shall be the responsibility of the Indemnifying Party if ( i ) the Indemnifying Party and the Indemnified Party are both named parties to the proceedings and the Indemnified Party shall have reasonably concluded that representation of both parties by the same counsel would be inappropriate due to actual or potential conflicts of interest (in which case the Indemnifying Party shall not be responsible for expenses in respect of more than one
 
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counsel for the Indemnified Party in any single jurisdiction), or ( ii ) the Indemnified Party assumes the defense of the Third Party Claim after the Indemnifying Party has failed, in the reasonable judgment of the Indemnified Party, to diligently defend the Third Party Claim after having elected to assume its defense.
(d) If the Indemnifying Party ( i ) does not elect to assume the defense in accordance with Section 10.8(b) or ( ii ) after assuming the defense of a Third Party Claim, fails to take reasonable steps necessary to defend diligently such Third Party Claim within ten (10) days after receiving written notice from the Indemnified Party to the effect that the Indemnifying Party has so failed, the Indemnified Party shall have the right but not the obligation to assume its own defense; provided , that the Indemnified Party shall not settle or compromise such Third Party Claim without the consent of the Indemnifying Party, which consent shall not be unreasonably withheld. For the avoidance of doubt, the Indemnified Party’s right to indemnification for a Third Party Claim shall not be adversely affected by assuming the defense of such Third Party Claim.
(e) Subject to Article VI , the Indemnified Party and the Indemnifying Party shall cooperate in the defense of a Third Party Claim including by ( i ) expeditiously making available all witnesses, all pertinent records, all materials, and all information in each other’s possession or under each other’s control relating to the Third Party Claim, ( ii ) assisting with litigation defense strategy, investigations, discovery preparation, trial preparation, and similar activities with respect to the Third Party Claim and ( iii ) using commercially reasonable efforts to avoid taking any action, or omitting to take any action, that would materially and adversely prejudice each other’s defense of, or actual or potential rights of recovery with respect to, the Third Party Claim. The Indemnifying Party shall have no obligation in accordance with this Article X to an Indemnified Party for any Third Party Claim to the extent such Indemnified Party fails to comply with this Section 10.8(e) with respect to the Third Party Claim and such failure shall have materially and adversely prejudiced the Indemnifying Party.
Section 10.9 Remedies Cumulative . The remedies provided in this Article X shall be cumulative and, subject to the provisions of Article XI , shall not preclude assertion by any Indemnified Party of any other rights or the seeking of any and all other remedies against any Indemnifying Party.
Section 10.10 Tax Matters . All indemnity payments pursuant to this Article X shall be treated as relating to periods ending on or prior to the Distribution Effective Time and shall be treated for all tax purposes as a contribution to capital or as a distribution with respect to stock, as applicable. Notwithstanding anything to the contrary set forth herein, indemnification for all matters relating to Taxes shall be governed by terms, provisions and procedures of the Tax Matters Agreement and not this Article X .
Section 10.11 Survival of Indemnities . The rights and obligations of the Indemnified Parties under this Article X shall survive the distribution, sale or other transfer by either Party or any member of its respective Group of any Assets or the assignment by it of any Liabilities.
 
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ARTICLE XI
DISPUTE RESOLUTION
Section 11.1 Disputes . Except as otherwise specifically provided in any Ancillary Agreement, the procedures for discussion, negotiation and mediation set forth in this Article XI shall apply to all disputes, controversies or claims (whether arising in contract, tort or otherwise) that may arise out of, relate to, arise under or in connection with, this Agreement or any Ancillary Agreement, or the Transactions (including, all actions taken in furtherance of the Transactions on or prior to the Distribution Effective Time), between or among any member of the Distributing Group and the Publishing Group (collectively, “ Disputes ”); it being agreed that if any Ancillary Agreement provides for different dispute resolution procedures for Disputes thereunder, such dispute resolution procedures shall apply with respect to such Dispute.
Section 11.2 Dispute Resolution .
(a) On the Distribution Date, Distributing and Publishing shall form a committee (the “ Executive Committee ”) to which all Disputes will be submitted for resolution in accordance with this Section 11.2 . The Executive Committee shall consist of two representatives designated by each Party and shall initially consist of the Chief Financial Officer and the General Counsel (or other chief legal officer) of each Party. Each Party may replace one or more of its representatives at any time upon notice to the other Party.
(b) If a Dispute arises, no Party may take any formal legal action (such as seeking to terminate this Agreement, seeking mediation in accordance with Section 11.3 , or instituting or seeking any judicial or other legal action, relief, or remedy with respect to or arising out of this Agreement) unless such Party has first ( i ) delivered a notice of dispute (the “ Dispute Notice ”) to all of the members of the Executive Committee and ( ii ) complied with the terms of this Article XI ; provided , that the foregoing shall not apply to any Disputes with respect to compliance with obligations with respect to confidentiality or preservation of privilege. The Executive Committee shall meet no later than the tenth (10 th ) Business Day following delivery of the Dispute Notice (the “ Dispute Meeting ”) and shall seek to resolve each Dispute that is listed on the Dispute Notice through informal good faith negotiation. Each Party shall cause its designees on the Executive Committee to negotiate in good faith to resolve all Disputes in a timely manner. If by the tenth (10 th ) Business Day following the Dispute Meeting the Executive Committee has failed to meet or failed to resolve all of the Disputes (the “ Resolution Failure Date ”), the Parties shall proceed to mediate the unresolved Disputes (“ Unresolved Disputes ”) in accordance with Section 11.3 .
Section 11.3 Mediation of Unresolved Disputes . The Parties shall attempt to resolve all Unresolved Disputes by non-binding mediation. The Parties shall negotiate in good faith to determine the mediator, the mediator’s compensation and related costs, and the applicable rules for the mediation. If by the fifteenth (15th) Business Day following the Resolution Failure Date, the Parties have been unable to settle an Unresolved Dispute, the obligations of the Parties in this Article XI shall terminate with respect to such Unresolved Dispute.
 
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Section 11.4 Continuity of Service and Performance . Unless otherwise agreed in writing, the Parties shall continue to provide service and honor all other commitments under this Agreement and each Ancillary Agreement during the course of any dispute resolution pursuant to the provisions of this Article XI with respect to all matters not subject to such Dispute.
ARTICLE XII
FURTHER ASSURANCES
Section 12.1 Further Assurances .
(a) The Parties shall use all commercially reasonable efforts to take, or cause to be taken, all appropriate action, to do or cause to be done all things necessary, proper or advisable under applicable Law, and to execute and deliver such documents and other papers, as may be required to carry out the provisions of this Agreement and any Ancillary Agreement and to consummate and make effective the Transactions, whether before or after the Distribution Effective Time.
(b) Without limiting the foregoing, prior to, on and after the Distribution Date, each Party shall, and shall cause the members of its respective Group to, cooperate with the other Party and the members of such other Party’s Group, and without any further consideration, but at the expense of the requesting Person, to execute and deliver, or use its commercially reasonable efforts to cause to be executed and delivered, all instruments, including, instruments of conveyance, assignment and transfer, and to make all filings with, and to obtain all necessary Consents and Governmental Approvals, including, under any permit, license, agreement, indenture or other instrument, and to take all such other actions as such Party or any member of such Party’s Group may reasonably be requested to take by any other Party or any member of such other Party’s Group from time to time, consistent with the terms of this Agreement and the Ancillary Agreements, in order to effectuate the provisions and purposes of this Agreement and the Ancillary Agreements and the Transactions.
(c) Each Party will cause to be performed and hereby guarantees the performance of all actions, agreements and obligations set forth herein to be performed by any member of its Group.
ARTICLE XIII
AMENDMENT AND TERMINATION
Section 13.1 Amendment and Termination .
(a) Prior to the consummation of the Distribution, this Agreement may be amended, supplemented, terminated and the transactions contemplated hereby may be modified or abandoned at any time by Distributing, in its sole and absolute discretion.
(b) After the consummation of the Distribution, this Agreement may not be amended, supplemented or terminated except by an agreement in writing signed by the Parties.
 
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Section 13.2 Effect of Termination . In the event of a termination in accordance with Section 13.1 , this Agreement shall forthwith become void and there shall be no Liability on the part of either Party; provided , that such termination shall have no effect on any transactions effected prior to such termination.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 LIMITATION OF LIABILITY .
(a) IN NO EVENT SHALL ANY MEMBER OF ONE GROUP BE LIABLE TO ANY MEMBER OF THE OTHER GROUP, FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE DAMAGES OR LOST PROFITS, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING, NEGLIGENCE OR STRICT LIABILITY) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT SUCH DAMAGES ARE FORESEEABLE OR SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED , THAT THE FOREGOING LIMITATIONS SHALL NOT LIMIT AN INDEMNIFYING PARTY’S INDEMNIFICATION OBLIGATIONS HEREUNDER WITH RESPECT TO ANY LIABILITY ANY INDEMNIFIED PARTY MAY HAVE TO ANY THIRD PARTY FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE DAMAGES OR LOST PROFITS, EXCEPT AS OTHERWISE PROVIDED IN THE ANCILLARY AGREEMENTS.
(b) Neither Party nor any member of its Group shall have any Liability to the other Party or any member of such other Party’s Group ( i ) with respect to any Information exchanged or provided pursuant to this Agreement, whether such Information is historical or forward looking, that is found to be inaccurate, in the absence of gross negligence or willful misconduct by the providing Person, or ( ii ) with respect to any Information that is lost or destroyed after commercially reasonable efforts by the Person from whom Information is requested pursuant to this Agreement to comply with the provisions of Section 6.3 . Notwithstanding the foregoing, nothing contained in this Section 14.1(b) shall affect or impair ( x ) the assumption and acceptance by the applicable members of the Distributing Group of the Distributing Transaction Liabilities and ( y ) the assumption and acceptance by the applicable members of the Publishing Group of the Publishing Transaction Liabilities.
Section 14.2 Expenses . Except as otherwise expressly set forth in this Agreement or any Ancillary Agreement, all costs and expenses incurred and directly related to the Transactions shall: ( i ) to the extent incurred and payable on or prior to the Distribution Effective Time, be paid by Distributing; and ( ii ) to the extent arising and payable following the Distribution Effective Time, be paid by the Party incurring such cost or expense.
Section 14.3 Counterparts . This Agreement and any amendment hereto may be executed in multiple counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or by email delivery of scanned pages (e.g., “.pdf” format data files) shall be effective as delivery of a manually executed counterpart to this Agreement.
 
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Section 14.4 Notices . All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by an internationally recognized overnight courier service, by facsimile or email (with written confirmation of receipt), or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 14.4 ):
If to Distributing, to:
Tribune Company
435 North Michigan Avenue
Chicago, Illinois 60611
Attn.: General Counsel
Facsimile: (312) 222-4206
Email: elazarus@tribune.com
If to Publishing, to:
Tribune Publishing Company
202 West First Street
Los Angeles, California 90012
Attn.: Julie Xanders
Facsimile: (213) 237-4401
Email: Julie.Xanders@latimes.com
Section 14.5 Public Announcements . Following the Distribution Date, the Parties and the members of their respective Groups shall, subject to Section 6.5 , be permitted to make, or cause to be made, any press release or public announcement in respect of this Agreement or the transactions contemplated by this Agreement or otherwise communicate with any news media unless otherwise prohibited by Law or any Ancillary Agreement; provided , that the Parties shall, and shall cause the members of their respective Groups to, consult with each other prior to issuing, and shall, subject to the requirements of Section 6.5 , provide the other Party or the applicable members of such other Party’s Group the opportunity to review and comment upon, press releases and other public statements in connection with any Transaction and prior to making any filings with any Governmental Authority with respect thereto.
Section 14.6 Severability . If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any Law or public policy, all other terms and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated by this Agreement is not affected in any manner materially adverse to either Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement are consummated as originally contemplated to the greatest extent possible.
 
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Section 14.7 Entire Agreement . This Agreement and the Ancillary Agreements, including the exhibits and schedules thereto and together with all the agreements contemplated hereby and thereby (including the Implementation Documents), constitute the entire agreement of the Parties with respect to the subject matter hereof and thereof and supersede all prior agreements and undertakings, both written and oral, between the Parties with respect to the subject matter hereof and thereof.
Section 14.8 Assignment . This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. Except as otherwise provided for in this Agreement, this Agreement shall not be assignable, in whole or in part, directly or indirectly, by either Party without the prior written consent of the other Parties, and any attempt to assign any rights or obligations arising under this Agreement without such consent shall be void. Notwithstanding the foregoing, a Party may assign this Agreement in connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of its Assets; provided , that the surviving entity of such merger or the transferee of such Assets shall agree in writing, reasonably satisfactory to the other Party, to be bound by the terms of this Agreement as if named as a party hereto. Except as otherwise expressly provided for in this Agreement or any Ancillary Agreement, the provisions of this Section 14.8 shall not apply to any Ancillary Agreement, the assignment of which shall be subject to the terms of such Ancillary Agreement.
Section 14.9 Third Party Beneficiaries . Except for the rights for release and indemnification under this Agreement of any Distributing Indemnified Party or Publishing Indemnified Party in their respective capacities as such, no provision of this Agreement is intended to confer any rights, benefits, remedies, obligations or liabilities hereunder upon any Person other than the Parties and their respective successors and assigns.
Section 14.10 Governing Law; Jurisdiction .
(a) This Agreement shall be governed by, and construed in accordance with, the Laws of the State of Delaware, without giving effect to the conflicts of Law principles thereof insofar as such Laws would otherwise result in the application of the Laws of another state.
(b) Each of the Parties submits to the exclusive jurisdiction of any state courts and federal courts of the United States of America located in the State of Delaware, and all appellate courts to each thereof, in all actions and proceedings arising out of or relating to this Agreement or the transactions contemplated hereby or for recognition or enforcement of all judgments relating thereto, and each of the Parties ( i ) will commence all such actions and proceedings only in such courts, ( ii ) will cause all claims in respect of all such actions and proceedings to be heard and determined in such state court or, to the extent permitted by Law, in such federal court, ( iii ) waives, to the fullest extent it may legally and effectively do so, all objections that it may now or hereafter have to the laying of venue of all such actions and proceedings in any such state or federal court, and ( iv ) waives, to the fullest extent permitted by Law, the defense of an inconvenient forum to the maintenance of such actions and proceedings in all such Delaware
 
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state and federal courts. A final judgment in any such action or proceeding will be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each Party irrevocably consents to service of process in the manner provided for notices in Section 14.4 . Nothing in this Agreement will affect the right of either Party to serve process in any other manner permitted by applicable Law.
Section 14.11 Waiver of Jury Trial . EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH OF THE PARTIES HEREBY ( A ) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND ( B ) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 14.11 .
Section 14.12 Headings . The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.
Section 14.13 Interpretation . Words in the singular shall be held to include the plural and vice versa and words of one gender shall be held to include the other gender as the context requires. The terms “hereof”, “herein” and “hereunder” and words of similar import, unless otherwise stated, shall be construed to refer to this Agreement as a whole (including all of the schedules, exhibits and appendices hereto) and not to any particular provision of this Agreement. References to Articles, Sections, Schedules and Exhibits are to Articles, Sections, Schedules and Exhibits of this Agreement unless otherwise specified. All Schedules and Exhibits annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized term used in any Schedule or Exhibit but not otherwise defined therein shall have the meaning given to such term in this Agreement. References to any agreement or contract are to that agreement or contract as amended, supplemented or modified from time to time in accordance with the terms hereof and thereof. The word “including” and words of similar import shall mean “including, without limitation”. “Writing”, “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form. References to any Person include the successors and permitted assigns of that Person. Any reference to “days” means calendar days unless Business Days are expressly specified. The word “or” shall not be exclusive. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly and equally by the Parties and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship of any of the provisions of this Agreement.
 
52

Section 14.14 Specific Performance . In the event of any actual or threatened default in, or breach of, any of the terms, conditions and provisions of this Agreement, the affected Party shall have the right to specific performance and injunctive or other equitable relief of its rights under this Agreement, in addition to any and all other rights and remedies at Law or in equity, and all such rights and remedies shall be cumulative. The other Party shall not oppose the granting of such relief. The Parties agree that the remedies at Law for any breach or threatened breach hereof, including monetary damages, are inadequate compensation for any loss and that any defense in any action for specific performance that a remedy at Law would be adequate is waived. Any requirements for the securing or posting of any bond with such remedy are waived.
Section 14.15 Payment Terms . Except as expressly provided to the contrary in this Agreement or in any Ancillary Agreement, any amount to be paid or reimbursed by one Party to the other under this Agreement shall be paid or reimbursed hereunder within ten (10) Business Days after presentation of an invoice or a written demand therefor and setting forth, or accompanied by, reasonable documentation or other reasonable explanation supporting such amount.
Section 14.16 Survival of Covenants . Except as expressly set forth in this Agreement, the covenants, representations and warranties contained in this Agreement, and the Liabilities for the breach of any obligations contained herein, shall survive the Distribution Effective Time and shall remain in full force and effect.
Section 14.17 Waiver . Either Party to this Agreement may ( i ) extend the time for the performance of any of the obligations or other acts of the other Party and ( ii ) waive compliance with any of the agreements of the other Party or conditions to such Party’s obligations contained herein. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the Party against whom it is sought to enforce such extension or waiver. Any waiver of any term or condition shall not be construed as a waiver of any subsequent breach or a subsequent waiver of the same term or condition, or a waiver of any other term or condition of this Agreement. The failure of either Party to assert any of its rights hereunder shall not constitute a waiver of any of such rights.
[Signature page follows]
 
53

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

TRIBUNE COMPANY	
		
By:	 	 	
	 	Name:	
	 	Title:	
	
TRIBUNE PUBLISHING COMPANY	
		
By:	 	 	
	 	Name:	
	 	Title:	
 
54

Exhibit 3.1
FORM OF
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
TRIBUNE PUBLISHING COMPANY
TRIBUNE PUBLISHING COMPANY, a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows:
1. The present name of the corporation is Tribune Publishing Company (the “ Corporation ”).
2. The Corporation was originally formed by means of a Certificate of Incorporation filed with the Secretary of State of the State of Delaware on November 21, 2013.
3. The Corporation’s Certificate of Incorporation is hereby amended and restated pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware (as amended from time to time, the “ DGCL ”), so as to read in its entirety in the form attached hereto as Exhibit A and incorporated herein by this reference.
4. This amendment and restatement of the Certificate of Incorporation of the Corporation has been duly adopted in accordance with the provisions of Sections 228, 242 and 245 of the DGCL.

IN WITNESS WHEREOF, the undersigned officer of the Corporation has executed this Amended and Restated Certificate of Incorporation on the [•] day of [•], 2014.

By:	 	 	
	 	Name: Steven Berns	
	 	Title: President and Chief Executive Officer	
[Amended and Restated Certificate of Incorporation of Tribune Publishing Company]

Exhibit A
FORM OF
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
TRIBUNE PUBLISHING COMPANY
FIRST . Name . The name of the Corporation is Tribune Publishing Company.
SECOND . Registered Office . The Corporation’s registered office in the State of Delaware is Corporation Service Company, 2711 Centerville Road, Suite 400, in the City of Wilmington, County of New Castle, 19808. The name of its registered agent at such address is Corporation Service Company.
THIRD . Purpose . The nature of the business of the Corporation and its purpose is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “ DGCL ”).
FOURTH . Capital Stock . The total number of shares of stock which the Corporation shall have authority to issue is 330,000,000, consisting of: (x) 300,000,000 shares of common stock, par value $0.01 per share (the “ Common Stock ”), and (y) 30,000,000 shares of preferred stock, par value $0.01 per share (the “ Preferred Stock ”), issuable in one or more series as hereinafter provided. The number of authorized shares of the Common Stock or Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of at least a majority of the voting power of the stock of the Corporation entitled to vote generally in the election of directors irrespective of the provisions of Section 242(b)(2) of the DGCL or any corresponding provision hereinafter enacted.
1. Provisions Relating to the Common Stock .
(a) Except as otherwise provided in this Amended and Restated Certificate of Incorporation or by the DGCL, each holder of shares of Common Stock shall be entitled, with respect to each share of Common Stock held by such holder, to one vote in person or by proxy on all matters submitted to a vote of the holders of Common Stock, whether voting separately as a class or otherwise.
(b) Subject to the preferences and rights, if any, applicable to shares of Preferred Stock or any series thereof, the holders of shares of Common Stock shall be entitled to receive such dividends and other distributions in cash, property, stock or otherwise as may be declared thereon by the Board of Directors at any time and from time to time out of assets or funds of the Corporation legally available therefor and shall share equally on a per share basis in such dividends and distributions.

(c) In the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, after payment or provision for payment of the debts and other liabilities of the Corporation, and subject to the preferences and rights, if any, applicable to shares of Preferred Stock or any series thereof, the holders of shares of Common Stock shall be entitled to receive all of the remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion to the number of shares of Common Stock held by them.
2. Provisions Relating to the Preferred Stock .
(a) The Preferred Stock may be issued at any time and from time to time in one or more series. The Board of Directors is hereby authorized to provide for the issuance of shares of Preferred Stock in one or more series and, by filing a certificate of designation pursuant to the applicable provisions of the DGCL (hereinafter referred to as a “ Preferred Stock Certificate of Designation ”), to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences and the relative, participating, optional or other special rights, and the qualifications, limitations and restrictions thereof, of shares of each such series, including, without limitation, dividend rights, dividend rates, conversion rights, voting rights, terms of redemption and liquidation preferences.
(b) The Common Stock shall be subject to the express terms of the Preferred Stock and any series thereof.
(c) Except as otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any amendment to this Amended and Restated Certificate of Incorporation or to a Preferred Stock Certificate of Designation that alters or changes the powers, preferences, rights or other terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other series of Preferred Stock, to vote thereon pursuant to this Amended and Restated Certificate of Incorporation or a Preferred Stock Certificate of Designation or pursuant to the DGCL as currently in effect or as the same may hereafter be amended.
3. Voting in Election of Directors . Except as may be required by the DGCL or as provided in this Amended and Restated Certificate of Incorporation or in a Preferred Stock Certificate of Designation, holders of Common Stock shall have the exclusive right to vote for the election of directors and for all other purposes, and holders of Preferred Stock shall not be entitled to vote on any matter or receive notice of any meeting of stockholders.
FIFTH . Management of Corporation . The following provisions are inserted for the management of the business, for the conduct of the affairs of the Corporation and for the purpose of creating, defining, limiting and regulating the powers of the Corporation and its directors and stockholders:

1. Except as may otherwise be provided by law, this Amended and Restated Certificate of Incorporation or the By-Laws of the Corporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.
2. Subject to any rights granted to the holders of shares of any class or series of Preferred Stock then outstanding, the number of directors of the Corporation shall be fixed, and may be altered from time to time, exclusively by resolution of the Board of Directors, but in no event may the number of directors of the Corporation be less than one.
3. Except as otherwise provided by applicable law, the Board of Directors shall be elected at the annual meeting of stockholders to serve one-year terms until successors shall have been duly elected and shall have qualified, or until his or her earlier death, resignation or removal.
4. Subject to any rights granted to the holders of shares of any class or series of Preferred Stock then outstanding, and except as otherwise provided by law, any vacancy in the Board of Directors that results from an increase in the number of directors, from the death, disability, resignation, disqualification or removal of any director or from any other cause shall be filled solely by an affirmative vote of at least a majority of the directors then in office, even if less than a quorum, or by a sole remaining director. A director elected to fill a vacancy or a newly created directorship shall hold office until his or her successor has been elected and qualified or until his or her earlier death, resignation or removal.
5. No director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of his or her fiduciary duty as a director, provided that nothing contained in this Article shall eliminate or limit the liability of a director ( a ) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, ( b ) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law, ( c ) under Section 174 of the DGCL or ( d ) for any transaction from which the director derived an improper personal benefit.
SIXTH . Stockholder Action by Written Consent . Any action required or permitted to be taken at any annual or special meeting of stockholders of the Corporation may be taken only upon the vote of the stockholders at an annual or special meeting duly called and may not be taken by written consent of the stockholders. The By-Laws may establish procedures regulating the submission by stockholders of nominations and proposals for consideration at meetings of stockholders of the Corporation.

SEVENTH . Special Meetings . Except as otherwise required by law and subject to any rights granted to holders of shares of any class or series of Preferred Stock then outstanding, special meetings of the stockholders of the Corporation for any purpose or purposes may be called only by the Chairman of the Board of Directors or the Chief Executive Officer or pursuant to a resolution of the Board of Directors adopted by at least a majority of the directors then in office. The stockholders of the Corporation shall not have the power to call a special meeting of the stockholders of the Corporation.
EIGHTH . DGCL 203. The Corporation shall not be governed by Section 203 of the DGCL (“ Section 203 ”) and the restrictions contained in Section 203 shall not apply to the Corporation, until the moment in time immediately following the time at which both of the following conditions exist (if ever): (a) Section 203 by its terms would, but for this Article EIGHTH, apply to the Corporation; and (b) there occurs a transaction in which the beneficial interest in the Corporation of Tribune Company, a Delaware corporation, is reduced to less than fifteen percent (15%) of the outstanding shares of Common Stock, and the Corporation shall thereafter be governed by Section 203 if and for so long as Section 203 by its terms shall apply to the Corporation.
NINTH . Amendment of the Certificate of Incorporation . The Corporation reserves the right to amend, alter or repeal any provision contained in this Amended and Restated Certificate of Incorporation in the manner now or hereafter prescribed by the DGCL, and all rights herein conferred upon stockholders or directors are granted subject to this reservation, provided , however , that any amendment, alteration or repeal of Section 5 of Article FIFTH shall not adversely affect any right or protection existing under this Amended and Restated Certificate of Incorporation immediately prior to such amendment, alteration or repeal, including any right or protection of a director thereunder in respect of any act or omission occurring prior to the time of such amendment, alteration or repeal. Notwithstanding anything to the contrary contained in this Amended and Restated Certificate of Incorporation, and notwithstanding that a lesser percentage may be permitted from time to time by applicable law, no provision of Articles SIXTH, SEVENTH, this Article NINTH and Articles TENTH and ELEVENTH may be amended, altered or repealed in any respect, nor may any provision or bylaw inconsistent therewith be adopted, unless in addition to any other vote required by this Amended and Restated Certificate of Incorporation or otherwise required by law, an amendment, alteration or repeal of Articles SIXTH, SEVENTH, this Article NINTH and Articles TENTH and ELEVENTH is approved at a meeting of the stockholders called for that purpose by, in addition to any other vote otherwise required by law, the affirmative vote of the holders of at least two-thirds (66 2 / 3 %) of the outstanding shares of Common Stock then entitled to vote at any annual or special meeting of stockholders.
TENTH . Amendment of the By-Laws . In furtherance and not in limitation of the powers conferred by law, the Board of Directors is expressly authorized to amend, alter or repeal the By-Laws of the Corporation, without the assent or vote of stockholders of the Corporation. Any amendment, alteration or repeal of the By-Laws of the Corporation by the Board of Directors shall require the affirmative vote of at least a majority of the directors then in office. In addition to any other vote otherwise required by law, the stockholders of the Corporation may amend, alter or repeal the By-Laws of the Corporation, provided that any such action will require the affirmative vote of the holders of at least two-thirds (66 2 / 3 %) of the outstanding shares of Common Stock entitled to vote at any annual or special meeting of stockholders.

ELEVENTH . Exclusive Jurisdiction for Certain Actions . Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall to the fullest extent permitted by law be the sole and exclusive forum for ( a ) any derivative action or proceeding brought on behalf of the Corporation, ( b ) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or agent of the Corporation to the Corporation or the Corporation’s stockholders, ( c ) any action asserting a claim arising pursuant to any provision of the DGCL, this Amended and Restated Certificate of Incorporation or the By-Laws of the Corporation, or ( d ) any action asserting a claim governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Article ELEVENTH.

Exhibit 3.2

FORM OF
TRIBUNE PUBLISHING COMPANY
AMENDED AND RESTATED BY-LAWS
Effective as of [•], 2014

TRIBUNE PUBLISHING COMPANY
BY-LAWS
Table of Contents

 	  	Page	 	
ARTICLE I	  				
		
MEETINGS OF STOCKHOLDERS	  				
		
Section 1.01. Annual Meetings	  	 	1	  	
Section 1.02. Special Meetings	  	 	1	  	
Section 1.03. Participation in Meetings by Remote Communication	  	 	1	  	
Section 1.04. Notice of Meetings; Waiver of Notice	  	 	2	  	
Section 1.05. Proxies	  	 	2	  	
Section 1.06. Voting Lists	  	 	3	  	
Section 1.07. Quorum	  	 	3	  	
Section 1.08. Voting	  	 	3	  	
Section 1.09. Adjournment	  	 	4	  	
Section 1.10. Organization; Procedure; Inspection of Elections	  	 	4	  	
Section 1.11. Consent of Stockholders in Lieu of Meeting	  	 	5	  	
Section 1.12. Notice of Stockholder Proposals and Nominations	  	 	5	  	
		
ARTICLE II	  				
		
BOARD OF DIRECTORS	  				
		
Section 2.01. General Powers	  	 	10	  	
Section 2.02. Number and Term of Office	  	 	10	  	
Section 2.03. Regular Meetings	  	 	10	  	
Section 2.04. Special Meetings	  	 	10	  	
Section 2.05. Notice of Meetings; Waiver of Notice	  	 	10	  	
Section 2.06. Quorum; Voting	  	 	10	  	
Section 2.07. Action by Telephonic Communications	  	 	11	  	
Section 2.08. Adjournment	  	 	11	  	
Section 2.09. Action Without a Meeting	  	 	11	  	
Section 2.10. Regulations	  	 	11	  	
Section 2.11. Resignations of Directors	  	 	11	  	
Section 2.12. Removal of Directors	  	 	11	  	
Section 2.13 Vacancies and Newly Created Directorships	  	 	11	  	
Section 2.14. Compensation	  	 	12	  	
Section 2.15. Reliance on Accounts and Reports, etc.	  	 	12	  	

Table of Contents
(Continued)

 	  	Page	 	
		
ARTICLE III	  				
		
COMMITTEES	  				
Section 3.01. How Constituted	  	 	12	  	
Section 3.02. Members and Alternate Members	  	 	12	  	
Section 3.03. Committee Procedures	  	 	13	  	
Section 3.04. Meetings and Actions of Committees	  	 	13	  	
Section 3.05. Resignations and Removals	  	 	13	  	
Section 3.06. Vacancies	  	 	13	  	
		
ARTICLE IV	  				
		
OFFICERS	  				
		
Section 4.01. Officers	  	 	13	  	
Section 4.02. Election	  	 	14	  	
Section 4.03. Compensation	  	 	14	  	
Section 4.04. Removal and Resignation; Vacancies	  	 	14	  	
Section 4.05. Authority and Duties of Officers	  	 	14	  	
Section 4.06. President	  	 	14	  	
Section 4.07. Vice Presidents	  	 	15	  	
Section 4.08. Secretary	  	 	15	  	
Section 4.09. Treasurer	  	 	16	  	
		
ARTICLE V	  				
		
CAPITAL STOCK	  				
		
Section 5.01. Certificates of Stock; Uncertificated Shares	  	 	17	  	
Section 5.02. Facsimile Signatures	  	 	17	  	
Section 5.03. Lost, Stolen or Destroyed Certificates	  	 	17	  	
Section 5.04. Transfer of Stock	  	 	17	  	
Section 5.05. Registered Stockholders	  	 	18	  	
Section 5.06. Transfer Agent and Registrar	  	 	18	  	
		
ARTICLE VI	  				
		
INDEMNIFICATION	  				
Section 6.01. Indemnification	  	 	18	  	
Section 6.02. Advance of Expenses	  	 	19	  	
Section 6.03. Procedure for Indemnification	  	 	19	  	
Section 6.04. Burden of Proof	  	 	20	  	
 
ii

Table of Contents
(Continued)

 	  	Page	 	
Section 6.05. Contract Right; Non-Exclusivity; Survival	  	 	20	  	
Section 6.06. Insurance	  	 	20	  	
Section 6.07. Employees and Agents	  	 	21	  	
Section 6.08. Interpretation; Severability	  	 	21	  	
		
ARTICLE VII	  				
		
OFFICES	  				
		
Section 7.01. Registered Office	  	 	21	  	
Section 7.02. Other Offices	  	 	21	  	
		
ARTICLE VIII	  				
		
GENERAL PROVISIONS	  				
		
Section 8.01. Dividends	  	 	21	  	
Section 8.02. Reserves	  	 	22	  	
Section 8.03. Execution of Instruments	  	 	22	  	
Section 8.04. Voting as Stockholder	  	 	22	  	
Section 8.05. Fiscal Year	  	 	22	  	
Section 8.06. Seal	  	 	22	  	
Section 8.07. Books and Records; Inspection	  	 	22	  	
Section 8.08. Electronic Transmission	  	 	22	  	
		
ARTICLE IX	  				
		
AMENDMENT OF BY-LAWS	  				
		
Section 9.01. Amendment	  	 	23	  	
		
ARTICLE X	  				
		
CONSTRUCTION	  				
		
Section 10.01. Construction	  	 	23	  	
 
iii

TRIBUNE PUBLISHING COMPANY
AMENDED AND RESTATED BY-LAWS
As amended and restated effective [•], 2014
ARTICLE I
MEETINGS OF STOCKHOLDERS
Section 1.01. Annual Meetings . The annual meeting of the stockholders of Tribune Publishing Company (the “ Corporation ”) for the election of directors and for the transaction of such other business as properly may come before such meeting shall be held either within or without the State of Delaware, on such date and at such place, if any, and time as exclusively may be fixed from time to time by resolution of the Corporation’s Board of Directors (the “ Board ”) and set forth in the notice or waiver of notice of the meeting. The Board may postpone, reschedule or cancel any annual meeting of stockholders previously scheduled by the Board.
Section 1.02. Special Meetings . Special meetings of the stockholders of the Corporation may be called only in the manner set forth in the certificate of incorporation of the Corporation as then in effect (as the same may be amended from time to time, the “ Certificate of Incorporation ”). Notice of every special meeting of the stockholders of the Corporation shall state the purpose or purposes of such meeting. Except as otherwise required by law, the business conducted at a special meeting of stockholders of the Corporation shall be limited exclusively to the business set forth in the Corporation’s notice of meeting, and the individual or group calling such meeting shall have exclusive authority to determine the business included in such notice. Any special meeting of the stockholders shall be held either within or without the State of Delaware, at such place, if any, and on such date and time, as shall be specified in the notice of such special meeting. The Board may postpone, reschedule or cancel any special meeting of the stockholders previously scheduled by the Board.
Section 1.03. Participation in Meetings by Remote Communication . The Board, acting in its sole discretion, may establish guidelines and procedures in accordance with applicable provisions of the General Corporation Law of the State of Delaware, as amended from time to time (the “ DGCL ”) and any other applicable law for the participation by stockholders and proxyholders in a meeting of stockholders by means of remote communications, and may determine that any meeting of stockholders will not be held at any place but will be held solely by means of remote communication. Stockholders and proxyholders complying with such procedures and guidelines and otherwise entitled to vote at a meeting of stockholders shall be deemed present in person and entitled to vote at a meeting of stockholders, whether such meeting is to be held at a designated place or solely by means of remote communication.

Section 1.04. Notice of Meetings; Waiver of Notice .
(a) The Secretary or any Assistant Secretary shall cause notice of each meeting of stockholders to be given in writing in a manner permitted by the DGCL not less than ten (10) days nor more than sixty (60) days prior to the meeting to each stockholder of record entitled to vote at such meeting, subject to such exclusions as are then permitted by the DGCL. The notice shall specify ( i ) the place, if any, date and time of such meeting, ( ii ) the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, ( iii ) in the case of a special meeting, the purpose or purposes for which such meeting is called, and ( iv ) such other information as may be required by law or as may be deemed appropriate by the Chairman of the Board, Secretary or the Board. If the stockholder list referred to in Section 1.06 of these By-Laws is made accessible on an electronic network, the notice of meeting must indicate how the stockholder list can be accessed. If the meeting of stockholders is to be held solely by means of electronic communications, the notice of meeting must provide the information required to access such stockholder list during the meeting.
(b) A written waiver of notice of meeting signed by a stockholder or a waiver by electronic transmission by a stockholder, whether given before or after the meeting time stated in such notice, is deemed equivalent to notice. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in a waiver of notice. Attendance of a stockholder at a meeting is a waiver of notice of such meeting, except when the stockholder attends a meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business at the meeting on the ground that the meeting is not lawfully called or convened.
Section 1.05. Proxies .
(a) Each stockholder entitled to vote at a meeting of stockholders or to express consent to or dissent from corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy.
(b) A stockholder may authorize a valid proxy by executing a written instrument signed by such stockholder, or by causing his or her signature to be affixed to such writing by any reasonable means, including but not limited to by facsimile signature, or by transmitting or authorizing an electronic transmission (as defined in Section 8.08 of these By-Laws) setting forth an authorization to act as proxy to the person designated as the holder of the proxy, a proxy solicitation firm or a like authorized agent. Proxies by electronic transmission must either set forth, or be submitted with, information from which it can be determined that the electronic transmission was authorized by the stockholder. Any copy, facsimile telecommunication or other reliable reproduction of a writing or transmission created pursuant to this section may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used if such copy, facsimile telecommunication or other reproduction is a complete reproduction of the entire original writing or transmission.
 
2

(c) No proxy may be voted or acted upon after the expiration of three years from the date of such proxy, unless such proxy provides for a longer period. Every proxy is revocable at the pleasure of the stockholder executing it unless the proxy states that it is irrevocable and applicable law makes it irrevocable. A stockholder may revoke any proxy that is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or by filing another duly executed proxy bearing a later date with the Secretary.
Section 1.06. Voting Lists . The officer of the Corporation who has charge of the stock ledger of the Corporation shall prepare, at least ten (10) days before every meeting of the stockholders (and before any adjournment thereof for which a new record date has been set), a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order and showing the address of each stockholder and the number of shares registered in the name of each stockholder. This list, which may be in any format including electronic format, shall be open to the examination of any stockholder prior to and during the meeting for any purpose germane to the meeting as required by the DGCL or other applicable law. The stock ledger shall be the only evidence as to who are the stockholders entitled by this section to examine the list required by this section or to vote in person or by proxy at any meeting of stockholders.
Section 1.07. Quorum . Except as otherwise required by law or by the Certificate of Incorporation, the presence in person or by proxy of the holders of record of a majority of the shares entitled to vote at a meeting of stockholders shall constitute a quorum for the transaction of business at such meeting, provided , however , that where a separate vote by a class or series is required, the holders of a majority in voting power of all issued and outstanding stock of such class or series entitled to vote on such matter, present in person or represented by proxy, shall constitute a quorum entitled to take action with respect to such matter. In the absence of a quorum, the chairperson of the meeting or the stockholders so present may, by a majority in voting power thereof, adjourn the meeting from time to time in the manner provided in Section 1.09 of these By-Laws until a quorum shall attend.
Section 1.08. Voting . Except as otherwise provided in the Certificate of Incorporation or by applicable law, every holder of record of shares entitled to vote at a meeting of stockholders is entitled to one vote for each share outstanding in his or her name on the books of the Corporation ( a ) at the close of business on the record date for such meeting or ( b ) if no record date has been fixed, at the close of business on the day next preceding the day on which notice of the meeting is given, or if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. All matters at any meeting at which a quorum is present, except the election of directors, shall be decided by the affirmative vote of the holders of at least a majority of the outstanding shares of common stock present in person or represented by proxy at the meeting and entitled to vote on the subject matter in question, unless otherwise expressly provided by express provision of law, the Certificate of Incorporation or these By-Laws. The election of directors shall be decided by the affirmative vote of the holders of at least a plurality of the votes of the outstanding shares of common stock present in person or represented by proxy at the meeting and entitled to vote in an election of directors, unless otherwise expressly provided by express provision of law, the Certificate of Incorporation or these By-Laws. The stockholders do not have the right to cumulate their votes for the election of directors.
 
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Section 1.09. Adjournment . Any meeting of stockholders may be adjourned from time to time, by the chairperson of the meeting or by the vote of a majority of the shares of stock present in person or represented by proxy at the meeting, to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the place, if any, and date and time thereof (and the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting) are announced at the meeting at which the adjournment is taken unless the adjournment is for more than thirty (30) days or a new record date is fixed for the adjourned meeting after the adjournment, in which case notice of the adjourned meeting in accordance with Section 1.04 of these By-Laws shall be given to each stockholder of record entitled to vote at the meeting. At the adjourned meeting, the Corporation may transact any business that might have been transacted at the original meeting.
Section 1.10. Organization; Procedure; Inspection of Elections .
(a) At every meeting of stockholders, the presiding person shall be the Chairman of the Board or, in the event of his or her absence or disability, the President, or, in the event of his or her absence or disability, a presiding person chosen by resolution of the Board. The Secretary or, in the event of his or her absence or disability, the Assistant Secretary, if any, or, if there be no Assistant Secretary, in the absence of the Secretary, an appointee of the presiding person, shall act as secretary of the meeting. The Board may make such rules or regulations for the conduct of meetings of stockholders as it shall deem necessary, appropriate or convenient. Subject to any such rules and regulations, the presiding person of any meeting shall have the right and authority to prescribe rules, regulations and procedures for such meeting and to take all such actions as in the judgment of the presiding person are appropriate for the proper conduct of such meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the presiding person of the meeting, may include, without limitation, the following: ( i ) the establishment of an agenda or order of business for the meeting; ( ii ) rules and procedures for maintaining order at the meeting and the safety of those present; ( iii ) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation, their duly authorized and constituted proxies or such other persons as the presiding person of the meeting shall determine; ( iv ) restrictions on entry to the meeting after the time fixed for the commencement thereof; and ( v ) limitations on the time allotted to questions or comments by participants. The presiding person at any meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine and declare to the meeting that a matter or business was not properly brought before the meeting and if such presiding person should so determine, such presiding person shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board or the presiding person of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
 
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(b) Preceding any meeting of the stockholders, the Board may, and when required by law shall, appoint one or more persons to act as inspectors of elections, and may designate one or more alternate inspectors. If no inspector or alternate so appointed by the Board is able to act, or if no inspector or alternate has been appointed and the appointment of an inspector is required by law, the person presiding at the meeting shall appoint one or more inspectors to act at the meeting. No director or nominee for the office of director shall be appointed as an inspector of elections. Each inspector, before entering upon the discharge of the duties of an inspector, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspectors shall discharge their duties in accordance with the requirements of applicable law.
Section 1.11. Consent of Stockholders in Lieu of Meeting . Except as otherwise provided in the Certificate of Incorporation, stockholders may not take any action by written consent in lieu of action at an annual or special meeting of stockholders.
Section 1.12. Notice of Stockholder Proposals and Nominations .
(a) Annual Meetings of Stockholders . (i) Nominations of persons for election to the Board and proposals of business to be considered by the stockholders at an annual meeting of stockholders may be made only ( A ) as specified in the Corporation’s notice of meeting (or any notice supplemental thereto) or ( B ) by or at the direction of the Board, or a committee appointed by the Board for such purpose, by any stockholder of the Corporation who or which ( 1 ) is entitled to vote at the meeting, ( 2 ) complies in a timely manner with all notice procedures set forth in this Section 1.12, and ( 3 ) is a stockholder of record when the required notice is delivered and at the date of the meeting. A stockholder proposal must constitute a proper matter for corporate action under the DGCL.
(ii) For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to subclause (B) of Section 1.12(a)(i) of these By-Laws, the stockholder must have given timely notice thereof in writing to the Secretary and, in the case of business other than nominations for persons for election to the Board, such other business must constitute a proper matter for stockholder action. To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not less than ninety (90) days nor more than one hundred and twenty (120) days prior to the first anniversary of the preceding year’s annual meeting (which date shall, for purposes of the Corporation’s first annual meeting of stockholders after its shares of common stock are first publicly traded, be deemed to have occurred on June 1, 2014); provided , however , that in the event that the date of the annual meeting is advanced by more than thirty (30) days or delayed by more than seventy (70) days from such anniversary date of the preceding year’s annual meeting, notice by the stockholder to be timely must be so delivered not earlier than one hundred and twenty (120) days prior to such annual meeting and not later than the close of business on the later of the ninetieth (90 th ) day prior to such annual meeting or the close of business on the tenth (10 th ) day following the day on which public announcement of the date of such meeting is first made. Such stockholder’s notice shall set forth ( A ) as to
 
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each person whom the stockholder proposes to nominate for election or re-election as a director, all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to and in accordance with Section 14(a) of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) and the rules and regulations promulgated thereunder, including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected; ( B ) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and, in the event that such business includes a proposal to amend the Certificate of Incorporation or these By-Laws, the text of the proposed amendment), the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and of the beneficial owner, if any, on whose behalf the proposal is made; and ( C ) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made ( 1 ) the name and address of such stockholder, as they appear on the Corporation’s books, and of such beneficial owner; ( 2 ) the class or series and number of shares of capital stock of the Corporation which are owned, directly or indirectly, beneficially and of record by such stockholder and such beneficial owner; ( 3 ) a representation that the stockholder is a holder of record of the stock of the Corporation at the time of giving the notice, will be entitled to vote at such meeting and will appear in person or by proxy at the meeting to propose such business or nomination; ( 4 ) a representation whether the stockholder or the beneficial owner, if any, will be or is part of a group which will ( x ) deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Corporation’s outstanding capital stock required to approve or adopt the proposal or elect the nominee and/or ( y ) otherwise solicit proxies or votes from stockholders in support of such proposal or nomination; and ( 5 ) a certification regarding whether such stockholder and beneficial owner, if any, have complied with all applicable federal, state and other legal requirements in connection with the stockholder’s and/or beneficial owner’s acquisition of shares of capital stock or other securities of the Corporation and/or the stockholder’s and/or beneficial owner’s acts or omissions as a stockholder of the Corporation. Notice of a stockholder nomination or proposal shall also set forth, as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made ( A ) a description of any agreement, arrangement or understanding with respect to the nomination or proposal and/or the voting of shares of any class or series of stock of the Corporation between or among the stockholder giving notice, the beneficial owner, if any, on whose behalf the nomination or proposal is made, any of their respective affiliates or associates and/or other person or persons (including their names) acting in concert with any of the foregoing (collectively, the “ proponent persons ”); ( B ) a description of any agreement, arrangement or understanding (including, without limitation, regardless of the form of settlement, any derivative, long or short positions, profit interests, forwards, futures, swaps, options, warrants, convertible securities, stock appreciation or similar rights, hedging transactions and borrowed or loaned shares) to which any proponent person is a party, the effect or intent of which is to transfer to or from any proponent person, in whole or in part, any of the economic consequences of ownership of any security of the Corporation, to increase
 
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or decrease the voting power of any proponent person with respect to shares of any class or series of stock of the Corporation and/or to provide any proponent person, directly or indirectly, with the opportunity to profit or share in any profit derived from, or to otherwise benefit economically from, any increase or decrease in the value of any security of the Corporation (a “ Derivative Instrument ”); ( C ) to the extent not disclosed pursuant to the immediately preceding clause (B), the principal amount of any indebtedness of the Corporation or any of its subsidiaries beneficially owned by such stockholder or by the beneficial owner, if any, together with the title of the instrument under which such indebtedness was issued and a description of any Derivative Instrument entered into by or on behalf of such stockholder or such beneficial owner relating to the value or payment of any indebtedness of the Corporation or any such subsidiary; and ( D ) any other information relating to such stockholder and beneficial owner, if any, required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in an election contest pursuant to and in accordance with Section 14(a) of the Exchange Act and the rules and regulations promulgated thereunder. The foregoing notice requirements shall be deemed satisfied by a stockholder if the stockholder has notified the Corporation of his or her intention to present a proposal at an annual meeting in compliance with Rule 14a–8 (or any successor thereof) promulgated under the Exchange Act, and such stockholder’s proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for such annual meeting. A stockholder providing notice of a proposed nomination for election to the Board or other business proposed to be brought before a meeting (whether given pursuant to this paragraph (a)(ii) or paragraph (b) of this Section 1.12 of these By-Laws) shall update and supplement such notice from time to time to the extent necessary so that the information provided or required to be provided in such notice shall be true and correct ( x ) as of the record date for determining the stockholders entitled to notice of the meeting and ( y ) as of the date that is fifteen (15) days prior to the meeting or any adjournment or postponement thereof, provided that if the record date for determining the stockholders entitled to vote at the meeting is less than fifteen (15) days prior to the meeting or any adjournment or postponement thereof, the information shall be supplemented and updated as of such later date. Any such update and supplement shall be delivered in writing to the Secretary at the principal executive offices of the Corporation not later than five (5) days after the record date for determining the stockholders entitled to notice of the meeting (in the case of any update and supplement required to be made as of the record date for determining the stockholders entitled to notice of the meeting), not later than ten (10) days prior to the date for the meeting or any adjournment or postponement thereof (in the case of any update or supplement required to be made as of fifteen (15) days prior to the meeting or adjournment or postponement thereof) and not later than five (5) days after the record date for determining the stockholders entitled to vote at the meeting, but no later than the date prior to the meeting or any adjournment or postponement thereof (in the case of any update and supplement required to be made as of a date less than fifteen (15) days prior the date of the meeting or any adjournment or postponement thereof). The Corporation may require any proposed nominee to furnish such other information as it may reasonably require to determine the eligibility of such proposed nominee to serve as a director of the Corporation and to determine the independence of such director under the Exchange Act and rules and regulations thereunder and applicable stock exchange rules. In addition, a stockholder seeking to bring an item of business before the annual meeting shall promptly provide any other information reasonably requested by the Corporation.
 
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(iii) Notwithstanding anything in Section 1.12(a)(ii) of these By-Laws to the contrary, in the event that the number of directors to be elected to the Board at an annual meeting is increased and there is no public announcement naming all of the nominees for director or specifying the size of the increased Board made by the Corporation at least one hundred (100) calendar days prior to the first anniversary of the preceding year’s annual meeting (which date shall, for purposes of the Corporation’s first annual meeting of stockholders after its shares of common stock are first publicly traded, be deemed to have occurred on June 1, 2014), then a stockholder’s notice under this Section 1.12(a) shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it is received by the Secretary at the principal executive offices of the Corporation not later than the close of business on the tenth (10 th ) day following the day on which such public announcement is first made by the Corporation.
(b) Special Meetings of Stockholders . Only such business as shall have been brought before the special meeting of the stockholders pursuant to the Corporation’s notice of meeting shall be conducted at such meeting. Nominations of persons for election to the Board may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting ( 1 ) by or at the direction of the Board or a Committee appointed by the Board for such purpose or ( 2 ) provided that the Board has determined that directors shall be elected at such meeting, by any stockholder of the Corporation who is entitled to vote at the meeting, who complies with the notice procedures set forth in this Section 1.12(b) and who is a stockholder of record at the time such notice is delivered to the Secretary. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors of the Corporation, any stockholder entitled to vote at such meeting may nominate a person or persons, as the case may be, for election to such position(s) as specified by the Corporation, if the stockholder’s notice as required by Section 1.12(a)(ii) of these By-Laws shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the one hundred and twenty (120) days prior to such special meeting and not later than the close of business on the later of the ninetieth (90 th ) day prior to such special meeting or the tenth (10 th ) day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board to be elected at such meeting. In no event shall the public announcement of an adjournment or postponement of a special meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.
 
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(c) General .
(i) Only such persons who are nominated in accordance with the procedures set forth in this Section 1.12 shall be eligible to serve as directors and only such business shall be conducted at an annual or special meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section. Except as otherwise provided by applicable law, the Certificate of Incorporation or these By-Laws, the presiding person of a meeting of stockholders shall have the power and duty ( x ) to determine whether a nomination or any business proposed to be brought before the meeting was made in accordance with the procedures set forth in this Section 1.12 (including whether the stockholder or beneficial owner, if any, on whose behalf the nomination or proposal is made, solicited (or is part of a group which solicited) or did not so solicit, as the case may be, proxies in support of such stockholder’s nominee or proposal in compliance with such stockholder’s representation as required by clause (a)(ii)(C)(4) of this Section 1.12), and ( y ) if any proposed nomination or business is not in compliance with this Section 1.12, to declare that such defective nomination shall be disregarded or that such proposed business shall not be transacted.
(ii) If the stockholder (or a qualified representative of the stockholder) making a nomination or proposal under this Section 1.12 does not appear at a meeting of stockholders to present such nomination or proposal, the nomination shall be disregarded and/or the proposed business shall not be transacted, as the case may be, notwithstanding that proxies in favor thereof may have been received by the Corporation. For purposes of this Section 1.12, to be considered a qualified representative of the stockholder, a person must be authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders.
(A) Whenever used in these By-Laws, “ public announcement ” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and regulations promulgated thereunder.
(B) Notwithstanding the foregoing provisions of this Section 1.12, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Section 1.12. Nothing in this Section 1.12 shall be deemed to affect any rights of ( x ) stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or ( y ) the holders of any series of preferred stock to elect directors pursuant to any applicable provisions of the Certificate of Incorporation or of the relevant preferred stock certificate of designation.
(C) The announcement of an adjournment or postponement of an annual or special meeting does not commence a new time period (and does not extend any time period) for the giving of notice of a stockholder nomination or a stockholder proposal as described above.
 
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ARTICLE II
BOARD OF DIRECTORS
Section 2.01. General Powers . Except as may otherwise be provided by law, the Certificate of Incorporation or these By-Laws, the business and affairs of the Corporation shall be managed by or under the direction of the Board. The directors shall act only as a Board, and the individual directors shall have no power as such.
Section 2.02. Number and Term of Office . The number of directors constituting the entire Board and the term of office for each director shall be as provided for in the Certificate of Incorporation.
Section 2.03. Regular Meetings . Regular meetings of the Board shall be held on such dates, and at such times and places as are determined from time to time by the Board.
Section 2.04. Special Meetings . Special meetings of the Board shall be held whenever called by the Chairman of the Board or, in the event of his or her absence or disability, by the Secretary, or by a majority of the directors then in office, at such place, date and time as may be specified in the respective notices or waivers of notice of such meetings. Any business may be conducted at a special meeting.
Section 2.05. Notice of Meetings; Waiver of Notice .
(a) Notices of special meetings shall be given to each director, and notice of each resolution or other action affecting the date, time or place of one or more regular meetings shall be given to each director not present at the meeting adopting such resolution or other action, subject to Section 2.08 of these By-Laws. Notices shall be given personally, or by telephone, facsimile or email, directed to each director at the address, email address or telephone/facsimile number from time to time designated by such director to the Secretary. Each such notice must be given (received in the case of personal service) at least twenty-four (24) hours prior to the time of a special meeting, and at least five (5) days prior to the initial regular meeting affected by such resolution or other action, as the case may be.
(b) A written waiver of notice of meeting signed by a director or a waiver by electronic transmission by a director, whether given before or after the meeting time stated in such notice, is deemed equivalent to notice. Attendance of a director at a meeting is a waiver of notice of such meeting, except when the director attends a meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business at the meeting on the ground that the meeting is not lawfully called or convened.
Section 2.06. Quorum; Voting . At all meetings of the Board, the presence of a majority of the total authorized number of directors shall constitute a quorum for the transaction of business. Except as otherwise required by law, the Certificate of Incorporation or these By-Laws, the vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board.
 
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Section 2.07. Action by Telephonic Communications . Members of the Board may participate in a meeting of the Board by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this provision shall constitute presence in person at such meeting.
Section 2.08. Adjournment . A majority of the directors present may adjourn any meeting of the Board to another date, time or place, whether or not a quorum is present. No notice need be given of any adjourned meeting unless ( a ) the date, time and place of the adjourned meeting are not announced at the time of adjournment, in which case notice conforming to the requirements of Section 2.05 of these By-Laws applicable to special meetings shall be given to each director, or ( b ) the meeting is adjourned for more than 24 hours, in which case the notice referred to in clause (a) shall be given to those directors not present at the announcement of the date, time and place of the adjourned meeting.
Section 2.09. Action Without a Meeting . Any action required or permitted to be taken at any meeting of the Board may be taken without a meeting if all members of the Board consent thereto in writing or by electronic transmission, and such writing or writings or electronic transmissions are filed with the minutes of proceedings of the Board. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.
Section 2.10. Regulations . To the extent consistent with applicable law, the Certificate of Incorporation and these By-Laws, the Board may adopt such rules and regulations for the conduct of meetings of the Board and for the management of the affairs and business of the Corporation as the Board may deem appropriate. The Board may elect from among its members a chairperson and one or more vice-chairpersons to preside over meetings and to perform such other duties as may be designated by the Board.
Section 2.11. Resignations of Directors . Any director may resign at any time by submitting an electronic transmission or by delivering a written notice of resignation, signed by such director, to the President or the Secretary. Such resignation shall take effect upon delivery unless the resignation specifies a later effective date or an effective date determined upon the happening of a specified event.
Section 2.12. Removal of Directors . Directors may be removed in the manner permitted in the DGCL.
Section 2.13. Vacancies and Newly Created Directorships . Any vacancies or newly created directorships shall be filled as set forth in the Certificate of Incorporation.
 
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Section 2.14. Compensation . The amount, if any, which each director shall be entitled to receive as compensation for his or her services shall be fixed from time to time by the Board. The Corporation will cause each non-employee director serving on the Board to be reimbursed for all reasonable out-of-pocket costs and expenses incurred by him or her in connection with such service.
Section 2.15. Reliance on Accounts and Reports, etc . A director, as such or as a member of any committee designated by the Board, shall in the performance of his or her duties be fully protected in relying in good faith upon the records of the Corporation and upon information, opinions, reports or statements presented to the Corporation by any of the Corporation’s officers or employees, or committees designated by the Board, or by any other person as to the matters the member reasonably believes are within such other person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.
ARTICLE III
COMMITTEES
Section 3.01. How Constituted . The Board shall designate such committees as may be required by applicable laws, regulations or stock exchange rules, and may designate such additional committees as it deems necessary or appropriate (collectively, the “ Committees ”). Each Committee shall consist of such number of Directors, with such qualifications, as may be required by applicable laws, regulations or stock exchange rules, or as from time to time may be fixed by the Board and shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation to the extent delegated to such Committee by resolution of the Board, which delegation shall include all such powers and authority as may be required by applicable laws, regulations or stock exchange rules. No Committee shall have any power or authority as to ( a ) approving or adopting, or recommending to the stockholders, any action or matter (other than the election or removal of directors) expressly required by the DGCL to be submitted to stockholders for approval, ( b ) adopting, amending or repealing any of these By-Laws or ( c ) as may otherwise be excluded by law or by the Certificate of Incorporation. Any Committee may be abolished or re-designated from time to time by the Board.
Section 3.02. Members and Alternate Members . The members of each Committee and any alternate members shall be selected by the Board. The Board may provide that the members and alternate members serve at the pleasure of the Board. An alternate member may replace any absent or disqualified member at any meeting of the Committee. An alternate member shall be given all notices of Committee meetings, may attend any meeting of the Committee, but may count towards a quorum and vote only if a member for whom such person is an alternate is absent or disqualified. Each member or alternate member of any Committee (whether designated at an annual meeting of the Board or to fill a vacancy or otherwise) shall hold office until his or her successor shall have been designated or until he or she shall cease to be a director, or until his or her earlier death, resignation or removal.
 
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Section 3.03. Committee Procedures . A quorum for each Committee shall be a majority of its members, unless the Committee has only one or two members, in which case a quorum shall be one member, or unless a greater quorum is established by the Board. The vote of a majority of the Committee members present at a meeting at which a quorum is present shall be the act of the Committee. Each Committee shall keep regular minutes of its meetings and report to the Board when required. The Board may adopt other rules and regulations for the government of any Committee not inconsistent with the provisions of these By-Laws, and each Committee may adopt its own rules and regulations of government, to the extent not inconsistent with these By-Laws or rules and regulations adopted by the Board.
Section 3.04. Meetings and Actions of Committees . Meetings and actions of each Committee shall be governed by, and held and taken in accordance with, the provisions of the following sections of these By-Laws, with such By-Laws being deemed to refer to the Committee and its members in lieu of the Board and its members:
(a) Section 2.03 (to the extent relating to place and time of regular meetings);
(b) Section 2.04 (relating to special meetings);
(c) Section 2.05 (relating to notice and waiver of notice);
(d) Sections 2.07 and 2.09 (relating to telephonic communication and action without a meeting); and
(e) Section 2.08 (relating to adjournment and notice of adjournment).
Special meetings of Committees may also be called by resolution of the Board.
Section 3.05. Resignations and Removals . Any member (and any alternate member) of any Committee may resign from such position at any time by delivering a written notice of resignation, signed by such member, to the President or the Secretary. Unless otherwise specified therein, such resignation shall take effect upon delivery. Any member (and any alternate member) of any Committee may be removed from such position by the Board at any time, either for or without cause.
Section 3.06. Vacancies . If a vacancy occurs in any Committee for any reason, the remaining members (and any alternate members) may continue to act if a quorum is present. A Committee vacancy may be filled only by the Board.
ARTICLE IV
OFFICERS
Section 4.01. Officers . The Board shall elect a President and a Secretary as officers of the Corporation. The Board may also elect a Treasurer, one or more Senior Vice Presidents, Vice Presidents, Assistant Secretaries and Assistant Treasurers, and such
 
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other officers and agents as the Board may determine (including a Chief Financial Officer). In addition, the President may designate one or more Senior Vice Presidents or Vice Presidents of the Corporation, although such individuals shall not be officers of the Corporation unless so designated by the Board of Directors. The Board from time to time may also delegate to any officer the power to appoint subordinate officers or agents and to prescribe their respective rights, terms of office, authorities and duties. Any action by an appointing officer may be superseded by action by the Board. Any number of offices may be held by the same person. No officer need be a director of the Corporation.
Section 4.02. Election . The officers of the Corporation elected by the Board shall serve at the pleasure of the Board. Officers and agents appointed pursuant to delegated authority as provided in Section 4.01 (or, in the case of agents, as provided in Section 4.06) shall hold their offices for such terms as may be determined from time to time by the appointing officer. Each officer shall hold office until his or her successor has been elected or appointed and qualified, or until his or her earlier death, resignation or removal.
Section 4.03. Compensation . The salaries and other compensation of all executive officers of the Corporation shall be fixed by the Board or in the manner established by the Board, including by any committee established by the Board for such purpose.
Section 4.04. Removal and Resignation; Vacancies . Any officer may be removed for or without cause at any time by the Board. Any officer granted the power to appoint subordinate officers and agents as provided in Section 4.01 may remove any subordinate officer or agent appointed by such officer, for or without cause. Any officer or agent may resign at any time by delivering notice of resignation, either in writing signed by such officer or by electronic transmission, to the Board or the President. Unless otherwise specified therein, such resignation shall take effect upon delivery. Any vacancy occurring in any office of the Corporation by death, resignation, removal or otherwise, may be filled by the Board or by the officer, if any, who appointed the person formerly holding such office.
Section 4.05. Authority and Duties of Officers . An officer of the Corporation shall have such authority and shall exercise such powers and perform such duties ( a ) as may be required by law, ( b ) to the extent not inconsistent with law, as are specified in these By-Laws, ( c ) to the extent not inconsistent with law or these By-Laws, as may be specified by resolution of the Board and ( d ) to the extent not inconsistent with any of the foregoing, as may be specified by the appointing officer with respect to a subordinate officer appointed pursuant to delegated authority under Section 4.01.
Section 4.06. President . The President shall, unless otherwise provided by the Board, be the chief executive officer of the Corporation, shall have general control and supervision of the policies and operations of the Corporation and shall see that all orders and resolutions of the Board are carried into effect. Unless otherwise provided by the Board, he or she shall manage and administer the Corporation’s business and affairs and shall also perform all duties and exercise all powers usually pertaining to the office
 
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of a chief executive officer of a corporation. He or she shall have the authority to sign, in the name and on behalf of the Corporation, checks, orders, contracts, leases, notes, drafts and all other documents and instruments in connection with the business of the Corporation. He or she shall have the authority to cause the employment or appointment of such employees or agents of the Corporation as the conduct of the business of the Corporation may require, to fix their compensation, and to remove or suspend any employee or any agent employed or appointed by any officer or to suspend any agent appointed by the Board. The President shall have the duties and powers of the Treasurer if no Treasurer is elected and shall have such other duties and powers as the Board may from time to time prescribe.
Section 4.07. Vice Presidents . If one or more Senior Vice Presidents or Vice Presidents have been elected, each Senior Vice President or Vice President shall perform such duties and exercise such powers as may be assigned to him or her from time to time by the Board or the President. In the event of absence or disability of the President, the duties of the President shall be performed, and his or her powers may be exercised, by such Senior Vice President or Vice President as shall be designated by the Board or, failing such designation, by the Senior Vice President or Vice President in order of seniority of election to that office.
Section 4.08. Secretary . Unless otherwise determined by the Board, the Secretary shall have the following powers and duties:
(a) The Secretary shall keep or cause to be kept a record of all the proceedings of the meetings of the stockholders, the Board and any Committees thereof in books provided for that purpose.
(b) The Secretary shall cause all notices to be duly given in accordance with the provisions of these By-Laws and as required by law.
(c) Whenever any Committee shall be appointed pursuant to a resolution of the Board, upon request, the Secretary shall furnish a copy of such resolution to the members of such Committee.
(d) The Secretary shall be the custodian of the records and of the seal of the Corporation and cause such seal (or a facsimile thereof) to be affixed to all certificates representing shares of the Corporation prior to the issuance thereof and to all documents and instruments that the Board or any officer of the Corporation has determined should be executed under seal, may sign (together with any other authorized officer) any such document or instrument, and when the seal is so affixed he or she may attest the same.
(e) The Secretary shall properly maintain and file all books, reports, statements, certificates and all other documents and records required by law, the Certificate of Incorporation or these By-Laws.
(f) The Secretary shall have charge of the stock books and ledgers of the Corporation and shall cause the stock and transfer books to be kept in such manner as to show at any time the number of shares of stock of the Corporation of each class issued and outstanding, the names (alphabetically arranged) and the addresses of the holders of record of such shares, the number of shares held by each holder and the date as of which each such holder became a holder of record.
 
15

(g) The Secretary shall sign (unless the Treasurer, an Assistant Treasurer or an Assistant Secretary shall have signed) certificates representing shares of the Corporation the issuance of which shall have been authorized by the Board.
(h) The Secretary shall perform, in general, all duties incident to the office of secretary and such other duties as may be specified in these By-Laws or as may be assigned to the Secretary from time to time by the Board or the President.
Section 4.09. Treasurer . Unless otherwise determined by the Board, the Treasurer, if there be one, shall be the chief financial officer of the Corporation and shall have the following powers and duties:
(a) The Treasurer shall have charge and supervision over and be responsible for the moneys, securities, receipts and disbursements of the Corporation, and shall keep or cause to be kept full and accurate records thereof.
(b) The Treasurer shall cause the moneys and other valuable effects of the Corporation to be deposited in the name and to the credit of the Corporation in such banks or trust companies or with such bankers or other depositaries as shall be determined by the Board or the President, or by such other officers of the Corporation as may be authorized by the Board or the President to make such determinations.
(c) The Treasurer shall cause the moneys of the Corporation to be disbursed by checks or drafts (signed by such officer or officers or such agent or agents of the Corporation, and in such manner, as the Board or the President may determine from time to time) upon the authorized depositaries of the Corporation and cause to be taken and preserved proper vouchers for all moneys disbursed.
(d) The Treasurer shall render to the Board or the President, whenever requested, a statement of the financial condition of the Corporation and of the transactions of the Corporation, and render a full financial report at the annual meeting of the stockholders, if called upon to do so.
(e) The Treasurer shall be empowered from time to time to require from all officers or agents of the Corporation reports or statements giving such information as he or she may desire with respect to any and all financial transactions of the Corporation.
(f) The Treasurer may sign (unless an Assistant Treasurer or the Secretary or an Assistant Secretary shall have signed) certificates representing shares of stock of the Corporation the issuance of which shall have been authorized by the Board.
 
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(g) The Treasurer shall perform, in general, all duties incident to the office of treasurer and such other duties as may be specified in these By-Laws or as may be assigned to the Treasurer from time to time by the Board or the President.
ARTICLE V
CAPITAL STOCK
Section 5.01. Certificates of Stock; Uncertificated Shares . The shares of the Corporation shall be represented by certificates, except to the extent that the Board has provided by resolution or resolutions that some or all of any or all classes or series of the stock of the Corporation shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation. Every holder of stock in the Corporation represented by certificates shall be entitled to have, and the Board may in its sole discretion permit a holder of uncertificated shares to receive upon request, a certificate signed by the appropriate officers of the Corporation, certifying the number and class of shares owned by such holder. Such certificate shall be in such form as the Board may determine, to the extent consistent with applicable law, the Certificate of Incorporation and these By-Laws.
Section 5.02. Facsimile Signatures. Any or all signatures on the certificates referred to in Section 5.01 of these By-Laws may be in facsimile form. If any officer, transfer agent or registrar who has signed, or whose facsimile signature has been placed upon, a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.
Section 5.03. Lost, Stolen or Destroyed Certificates . A new certificate may be issued in place of any certificate theretofore issued by the Corporation alleged to have been lost, stolen or destroyed only upon delivery to the Corporation of an affidavit of the owner or owners (or their legal representatives) of such certificate, setting forth such allegation, and a bond or other undertaking as may be satisfactory to a financial officer of the Corporation designated by the Board to indemnify the Corporation against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of any such new certificate.
Section 5.04. Transfer of Stock .
(a) Transfer of shares shall be made on the books of the Corporation upon surrender to the Corporation of a certificate for shares, duly endorsed or accompanied by appropriate evidence of succession, assignment or authority to transfer, and otherwise in compliance with applicable law. Shares that are not represented by a certificate shall be transferred in accordance with applicable law. Subject to applicable law, the provisions of the Certificate of Incorporation and these By-Laws, the Board may prescribe such additional rules and regulations as it may deem appropriate relating to the issue, transfer and registration of shares of the Corporation.
 
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(b) The Corporation may enter into agreements with shareholders to restrict the transfer of stock of the Corporation in any manner not prohibited by the DGCL.
Section 5.05. Registered Stockholders . Prior to due surrender of a certificate for registration of transfer, the Corporation may treat the registered owner as the person exclusively entitled to receive dividends and other distributions, to vote, to receive notice and otherwise to exercise all the rights and powers of the owner of the shares represented by such certificate, and the Corporation shall not be bound to recognize any equitable or legal claim to or interest in such shares on the part of any other person, whether or not the Corporation shall have notice of such claim or interests. If a transfer of shares is made for collateral security, and not absolutely, this fact shall be so expressed in the entry of the transfer if, when the certificates are presented to the Corporation for transfer or uncertificated shares are requested to be transferred, both the transferor and transferee request the Corporation to do so.
Section 5.06. Transfer Agent and Registrar . The Board may appoint one or more transfer agents and one or more registrars, and may require all certificates representing shares to bear the signature of any such transfer agents or registrars.
ARTICLE VI
INDEMNIFICATION
Section 6.01. Indemnification .
(a) In General . The Corporation shall indemnify, to the full extent permitted by the DGCL and other applicable law, any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (each, a “ proceeding ”) by reason of the fact that ( x ) such person is or was serving or has agreed to serve as a director or officer of the Corporation, or ( y ) such person, while serving as a director or officer of the Corporation, is or was serving or has agreed to serve at the request of the Corporation as a director, officer, employee, manager or agent of another corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise or ( z ) such person is or was serving or has agreed at the request of the Corporation to serve at the request of the Corporation as a director, officer, employee, manager or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, or by reason of any action alleged to have been taken or omitted by such person in such capacity, and who satisfies the applicable standard of conduct set forth in the DGCL or other applicable law:
(i) in a proceeding other than a proceeding by or in the right of the Corporation, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person or on such person’s behalf in connection with such proceeding and any appeal therefrom, or
 
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(ii) in a proceeding by or in the right of the Corporation to procure a judgment in its favor, against expenses (including attorneys’ fees) actually and reasonably incurred by such person or on such person’s behalf in connection with the defense or settlement of such proceeding and any appeal therefrom.
(b) Indemnification in Respect of Successful Defense . To the extent that a person has been successful on the merits or otherwise in defense of any proceeding referred to in Section 6.01(a) or in defense of any claim, issue or matter therein, such person shall be indemnified by the Corporation against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.
(c) Indemnification in Respect of Proceedings Instituted by Indemnitee . Section 6.01(a) does not require the Corporation to indemnify a person in respect of a proceeding (or part thereof) instituted by such person on his or her own behalf, unless such proceeding (or part thereof) has been authorized by the Board or the indemnification requested is pursuant to the last sentence of Section 6.03 of these By-Laws.
Section 6.02. Advance of Expenses . The Corporation shall advance all expenses (including reasonable attorneys’ fees) incurred by a person in defending any proceeding referred to in Section 6.01(a) prior to the final disposition of such proceeding upon written request of such person and delivery of an undertaking by such person to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation. The Corporation may authorize any counsel for the Corporation to represent (subject to applicable conflict of interest considerations) such person in any proceeding, whether or not the Corporation is a party to such proceeding.
Section 6.03. Procedure for Indemnification . Any indemnification under Section 6.01 of these By-Laws or any advance of expenses under Section 6.02 of these By-Laws shall be made only against a written request therefor (together with supporting documentation) submitted by or on behalf of the person seeking indemnification or advance. Indemnification may be sought by a person under Section 6.01 of these By-Laws in respect of a proceeding only to the extent that both the liabilities for which indemnification is sought and all portions of the proceeding relevant to the determination of whether the person has satisfied any appropriate standard of conduct have become final. A person seeking indemnification or advance of expenses may seek to enforce such person’s rights to indemnification or advance of expenses (as the case may be) in the Delaware Court of Chancery to the extent all or any portion of a requested indemnification has not been granted within ninety (90) days of, or to the extent all or any portion of a requested advance of expenses has not been granted within twenty (20) days of, the submission of such request. All expenses (including reasonable attorneys’ fees) incurred by such person in connection with successfully establishing such person’s right to indemnification or advancement of expenses under this Article, in whole or in part, shall also be indemnified by the Corporation.
 
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Section 6.04. Burden of Proof .
(a) In any proceeding brought to enforce the right of a person to receive indemnification to which such person is entitled under Section 6.01 of these By-Laws, the Corporation has the burden of demonstrating that the standard of conduct applicable under the DGCL or other applicable law was not met. A prior determination by the Corporation (including its Board or any Committee thereof, its independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct does not itself constitute evidence that the claimant has not met the applicable standard of conduct.
(b) In any proceeding brought to enforce a claim for advances to which a person is entitled under Section 6.02 of these By-Laws, the person seeking an advance need only show that he or she has satisfied the requirements expressly set forth in Section 6.02 of these By-Laws.
Section 6.05. Contract Right; Non-Exclusivity; Survival .
(a) The rights to indemnification and advancement of expenses provided by this Article VI shall be deemed to be separate contract rights between the Corporation and each person referred to in Section 6.01(a) who serves in any such capacity at any time while these provisions as well as the relevant provisions of the DGCL are in effect, and no repeal or modification of any of these provisions or any relevant provisions of the DGCL shall adversely affect any right or obligation of such person existing at the time of such repeal or modification with respect to any state of facts then or previously existing or any proceeding previously or thereafter brought or threatened based in whole or in part upon any such state of facts. Such “contract rights” may not be modified retroactively as to any such person without the consent of such person.
(b) The rights to indemnification and advancement of expenses provided by this Article VI shall not be deemed exclusive of any other indemnification or advancement of expenses to which a person seeking indemnification or advancement of expenses may be entitled by any agreement, vote of stockholders or disinterested directors, or otherwise.
(c) The rights to indemnification and advancement of expenses provided by this Article VI to any person referred to in Section 6.01(a) shall inure to the benefit of the heirs, executors and administrators of such person.
Section 6.06. Insurance . The Corporation may purchase and maintain insurance on behalf of any person who is or was or has agreed to become a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee, manager or agent of another Corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise against any liability asserted against such person and incurred by such person or on such person’s behalf in any such capacity, or arising out of such person’s status as such, whether or not the Corporation would have the power to indemnify such person against such liability under the provisions of this Article.
 
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Section 6.07. Employees and Agents . The Board, or any officer authorized by the Board generally or in the specific case to make indemnification decisions, may cause the Corporation to indemnify any present or former employee or agent of the Corporation in such manner and for such liabilities as the Board may determine, up to the fullest extent permitted by the DGCL and other applicable law.
Section 6.08. Interpretation; Severability . Terms defined in Sections 145(h) or (i) of the DGCL have the meanings set forth in such sections when used in this Article VI. If this Article or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify each person referred to in Section 6.01(a) as to costs, charges and expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, including an action by or in the right of the Corporation, to the fullest extent permitted by any applicable portion of this Article that shall not have been invalidated and to the fullest extent permitted by applicable law.
ARTICLE VII
OFFICES
Section 7.01. Registered Office . The registered office of the Corporation in the State of Delaware shall be located at the location provided in the Certificate of Incorporation.
Section 7.02. Other Offices . The Corporation may maintain offices or places of business at such other locations within or without the State of Delaware as the Board may from time to time determine or as the business of the Corporation may require.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.01. Dividends .
(a) Subject to any applicable provisions of law and the Certificate of Incorporation, dividends upon the shares of the Corporation may be declared by the Board at any regular or special meeting of the Board and any such dividend may be paid in cash, property or shares of the Corporation’s stock.
(b) A member of the Board, or a member of any Committee designated by the Board, shall be fully protected in relying in good faith upon the records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of its officers or employees, or Committees of the Board, or by any other person as to matters the director reasonably believes are within such other person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation, as to the value and amount of the assets, liabilities and/or net profits of the Corporation, or any other facts pertinent to the existence and amount of surplus or other funds from which dividends might properly be declared and paid.
 
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Section 8.02. Reserves . There may be set apart out of any funds of the Corporation available for dividends such sum or sums as the Board from time to time may determine proper as a reserve or reserves for meeting contingencies, equalizing dividends, repairing or maintaining any property of the Corporation or for such other purpose or purposes as the Board may determine conducive to the interest of the Corporation, and the Board may similarly modify or abolish any such reserve.
Section 8.03. Execution of Instruments . Except as otherwise required by law or the Certificate of Incorporation, the Board or any officer of the Corporation authorized by the Board may authorize any other officer or agent of the Corporation to enter into any contract or execute and deliver any instrument in the name and on behalf of the Corporation. Any such authorization must be in writing or by electronic transmission and may be general or limited to specific contracts or instruments.
Section 8.04. Voting as Stockholder . Unless otherwise determined by resolution of the Board, the President shall have full power and authority on behalf of the Corporation to attend any meeting of stockholders of any Corporation in which the Corporation may hold stock, and to act, vote (or execute proxies to vote) and exercise in person or by proxy all other rights, powers and privileges incident to the ownership of such stock at any such meeting, or through action without a meeting. The Board may by resolution from time to time confer such power and authority (in general or confined to specific instances) upon any other person or persons.
Section 8.05. Fiscal Year . The fiscal year of the Corporation shall be as determined by the Board of Directors. In the absence of such determination, the fiscal year of the Corporation shall begin on the first Monday after the last Sunday in December of each year and end on the last Sunday in the following December.
Section 8.06. Seal . The seal of the Corporation shall be circular in form and shall contain the name of the Corporation, the year of its incorporation and the words “Corporate Seal” and “Delaware”. The form of such seal shall be subject to alteration by the Board. The seal may be used by causing it or a facsimile thereof to be impressed, affixed or reproduced or may be used in any other lawful manner.
Section 8.07. Books and Records; Inspection . Except to the extent otherwise required by law, the books and records of the Corporation shall be kept at such place or places within or without the State of Delaware as may be determined from time to time by the Board.
Section 8.08. Electronic Transmission . “ Electronic transmission ”, as used in these By-Laws, means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.
 
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ARTICLE IX
AMENDMENT OF BY-LAWS
Section 9.01. Amendment . Subject to the provisions of the Certificate of Incorporation, these By-Laws may be amended, altered or repealed ( a ) by resolution adopted by a majority of the Board at any special or regular meeting of the Board if, in the case of such special meeting only, notice of such amendment, alteration or repeal is contained in the notice or waiver of notice of such meeting or ( b ) by the stockholders at any regular or special meeting of the stockholders upon the affirmative vote of at least two-thirds (66 2/3%) of the shares of the Corporation entitled to vote generally in the election of directors if, in the case of such special meeting only, notice of such amendment, alteration or repeal is contained in the notice or waiver of notice of such meeting.
Notwithstanding the foregoing, no amendment, alteration or repeal of Article VI shall adversely affect any right or protection existing under By-Laws immediately prior to such amendment, alteration or repeal, including any right or protection of a director, officer or other person thereunder in respect of any act or omission occurring prior to the time of such amendment.
ARTICLE X
CONSTRUCTION
Section 10.01. Construction . In the event of any conflict between the provisions of these By-Laws as in effect from time to time and the provisions of the Certificate of Incorporation of the Corporation as in effect from time to time, the provisions of such Certificate of Incorporation shall be controlling.
 
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Exhibit 10.1

 
TRANSITION SERVICES AGREEMENT
by and between
TRIBUNE COMPANY
and
TRIBUNE PUBLISHING COMPANY
Dated as of [            ], 2014

 

TABLE OF CONTENTS

 	  	 	  	Page	 	
ARTICLE I	  	
	
DEFINITIONS	  	
			
SECTION 1.01.	  	Certain Defined Terms	  	 	1	  	
SECTION 1.02.	  	Other Defined Terms	  	 	2	  	
	
ARTICLE II	  	
	
TRANSITION SERVICES	  	
			
SECTION 2.01.	  	Provision of Transition Services	  	 	3	  	
SECTION 2.02.	  	Contract Managers and Service Managers	  	 	4	  	
SECTION 2.03.	  	Change in Service	  	 	4	  	
SECTION 2.04.	  	Service Levels	  	 	5	  	
SECTION 2.05.	  	Limitation on Transition Services	  	 	5	  	
SECTION 2.06.	  	Intellectual Property	  	 	6	  	
SECTION 2.07.	  	Services Migration	  	 	6	  	
SECTION 2.08.	  	Limited Remedy and Limitation of Damages	  	 	7	  	
	
ARTICLE III	  	
	
SERVICE CHARGES	  	
			
SECTION 3.01.	  	Service Charges	  	 	8	  	
SECTION 3.02.	  	Invoices and Payment Terms	  	 	8	  	
SECTION 3.03.	  	Documentation; Audit	  	 	9	  	
SECTION 3.04.	  	Taxes	  	 	9	  	
	
ARTICLE IV	  	
	
DISCLAIMER OF REPRESENTATIONS AND WARRANTIES; LIMITATIONS OF
LIABILITY; INDEMNIFICATION	  

SECTION 4.01.	  	Disclaimer of Representations and Warranties	  	 	10	  	
SECTION 4.02.	  	Limitations of Liability	  	 	10	  	
SECTION 4.03.	  	Third Party Contractors	  	 	10	  	
SECTION 4.04.	  	Indemnity	  	 	11	  	
 
i

TABLE OF CONTENTS
(cont’d)

 	  	 	  	Page	 	
	
ARTICLE V	  	
	
TERM AND TERMINATION	  	
			
SECTION 5.01.	  	Term	  	 	11	  	
SECTION 5.02.	  	Termination	  	 	11	  	
SECTION 5.03.	  	Early Termination Charges	  	 	12	  	
SECTION 5.04.	  	Effect of Termination	  	 	12	  	
	
ARTICLE VI	  	
	
COVENANTS	  	
			
SECTION 6.01.	  	Confidentiality	  	 	13	  	
SECTION 6.02.	  	Access to Computer Systems	  	 	13	  	
SECTION 6.03.	  	Privilege	  	 	13	  	
	
ARTICLE VII	  	
	
GENERAL PROVISIONS	  	
			
SECTION 7.01.	  	Force Majeure Event	  	 	14	  	
SECTION 7.02.	  	Independent Contractor	  	 	14	  	
SECTION 7.03.	  	Third-Party Beneficiaries	  	 	14	  	
SECTION 7.04.	  	Conflicting Provisions	  	 	15	  	
SECTION 7.05.	  	Negotiation and Dispute Resolution	  	 	15	  	
SECTION 7.06.	  	Amendment	  	 	15	  	
SECTION 7.07.	  	Miscellaneous	  	 	15	  	
SCHEDULES

Schedule A	  	Transition Service Schedule (Distributing Services to Publishing)	
Schedule B	  	Transition Service Schedule (Publishing Services to Distributing)	
 
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TRANSITION SERVICES AGREEMENT
This TRANSITION SERVICES AGREEMENT (this “ Agreement ”), is made as of [            ], by and between Tribune Company, a Delaware corporation (“ Distributing ”), and Tribune Publishing Company, a Delaware Corporation (“ Publishing ”), (each a “ Party ” and together, the “ Parties ”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Separation Agreement (as defined below).
WHEREAS, Distributing and Publishing are parties to that certain Separation and Distribution Agreement, dated as of date hereof (the “ Separation Agreement ”);
WHEREAS, pursuant to the Separation Agreement, the Parties agreed to separate from Distributing the Publishing Business, which will be owned, operated and conducted, directly or indirectly, by Publishing; and
WHEREAS, in connection with the transactions contemplated by the Separation Agreement, the Parties desire to provide (or cause to be provided) certain services on a transitional basis following the Distribution Date to Publishing and its Affiliates that conduct the Publishing Business, on the one hand, and Distributing and its Affiliates that conduct the Distributing Business, on the other hand, in accordance with the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms . As used herein, the following terms shall have the following meanings:
“ Force Majeure Event ” means, with respect to a Party, an event beyond the control of such Party (or any Person acting on its behalf), including acts of God, storms, floods, fires, earthquakes, civil disturbances, strikes, lockouts or other labor and industrial disputes and disturbances, embargo, fuel or energy shortage, failures of a sole source provider to provide any necessary goods or services, acts of any government, acts of war (declared or undeclared), riots, insurrection and terrorism.
“ Information Technology ” means all hardware, computers, Software, servers, workstations, routers, hubs, switches, data, databases, data communications lines, network and telecommunications equipment, Internet-related information technology infrastructure and other information technology equipment.

“ Provider ” means Distributing or any of its Affiliates that conduct the Distributing Business, in such Person’s capacity as a Person providing services hereunder either directly or indirectly through Third Party Contractors, as described in Schedule A , or Publishing or any of its Affiliates that conduct the Publishing Business, in such Person’s capacity as a Person providing services hereunder either directly or indirectly through Third Party Contractors, as described in Schedule B .
“ Recipient ” means Publishing or any of its Affiliates that conduct the Publishing Business, in such Person’s capacity as a Person receiving services hereunder, as described in Schedule A , or Distributing or any of its Affiliates that conduct the Distributing Business, in such Person’s capacity as a Person receiving services hereunder, as described in Schedule B .
“ Transition Services ” means the services set forth in the Transition Service Schedules, including any Additional Services and Omitted Services provided pursuant to Section 2.01(b) , in each case, including any tasks inherent in or necessary for the accomplishment of such services.
“ Transition Service Schedules ” means the schedules attached hereto as Schedule A and Schedule B as may be amended by the Parties from time to time.
SECTION 1.02. Other Defined Terms . The following terms have the meanings defined for such terms in the Sections set forth below:

 	 	Term	  	Section	
	 	Additional Services	  	Section 2.01(b)	
	 	Agreement	  	Preamble	
	 	Consents	  	Section 2.05(a)	
	 	Contract Manager	  	Section 2.02	
	 	Distributing	  	Preamble	
	 	Migration Services	  	Section 2.07	
	 	Omitted Services	  	Section 2.01(b)	
	 	Party or Parties	  	Preamble	
	 	Protected Interests	  	Section 2.07	
	 	Publishing	  	Preamble	
	 	Recipients	  	Recitals	
	 	Reference Period	  	Section 2.01(b)	
	 	Separation Agreement	  	Recitals	
	 	Service Manager	  	Section 2.02	
	 	Significant Service Shortfall	  	Section 2.04(b)	
	 	Taxes	  	Section 3.04	
	 	Term	  	Section 5.01(b)	
	 	Third Party Contractors	  	Section 2.01(a)	
	 	TSA Documents	  	Section 3.03	
 
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ARTICLE II
TRANSITION SERVICES
SECTION 2.01. Provision of Transition Services .
(a) Subject to the terms and conditions set forth herein, Provider shall provide, directly or indirectly through third party contractors, subcontractors, licensors, vendors, outsourcers or other third party service providers (collectively, “ Third Party Contractors ”), to Recipient the Transition Services during their respective Terms; provided , that Provider shall remain responsible for the performance of the services in accordance herewith.
(b) In the event that any Recipients desire to have any Providers provide services that ( i ) were provided by such Provider to such Recipient within the twelve (12) months prior to the Distribution Date (the “ Reference Period ”), and ( ii ) are reasonably necessary for the operation of such Recipient’s Business as conducted as of the Distribution Date (“ Omitted Services ”; provided , that Omitted Services shall not include any service that Provider has replaced with (or for which Provider has substituted) a substantially comparable Transition Service as of the date hereof), such Recipient may, within one hundred eighty (180) days following the date hereof, request that such Provider provide such Omitted Services. If such Provider is reasonably capable of providing such Omitted Services, such Provider shall provide such Omitted Services to such Recipient as promptly as reasonably practicable and on terms to be negotiated by the Parties in good faith. In the event that any Recipients desire to have any Providers provide additional services that are not Omitted Services (“ Additional Services ”), such Providers, in their sole discretion, may agree to provide, directly or indirectly through Third Party Contractors, such Additional Services. Any request for an Omitted Service or Additional Service shall be in writing and shall specify, as applicable ( i ) the type and the scope of the requested service, ( ii ) who shall perform the requested service, ( iii ) where and to whom the requested service is to be provided and ( iv ) the proposed term for the requested service. In the event that any Providers are required to provide any Omitted Service, or agree to provide any Additional Service, as applicable, the Parties shall enter into an amendment to this Agreement amending the applicable Transition Service Schedule to reflect such Omitted Service or Additional Service, as applicable, and such Omitted Service or Additional Service, as applicable, shall be deemed to be part of this Agreement and the Transition Services from and after the date of such amendment.
(c) Notwithstanding anything to the contrary in this Agreement, nothing herein shall prohibit, modify or limit any Provider’s ability to transfer or allocate assets and liabilities, as the case may be, to any entity in connection with, or in contemplation of, the transactions contemplated by the Separation Agreement, the Ancillary Agreements (other than this Agreement) or otherwise, and to the extent that any such transfer or allocation results in a change to which a Party reasonably should be Provider and/or Recipient then the relevant Parties shall make such amendments, revisions or modifications to the applicable Transition Service Schedule as are reasonably necessary to reflect the appropriate Provider and/or Recipient, as the case may be.
 
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(d) The Parties agree and acknowledge that any other transition or similar assistance that may be provided by a Party or its Affiliates to another Party or its Affiliates (but is not described in the Transition Service Schedules and is not otherwise agreed to in writing pursuant to Section 2.03 or part of the terms of the Separation Agreement or any Ancillary Agreements) in connection with the transactions contemplated by the Separation Agreement shall be deemed to be provided under this Agreement as Transition Services (and therefore subject to the terms and conditions of this Agreement, including the exclusions of, and limitations on, liability), unless the Parties expressly agree in writing that such other transition or similar assistance is not governed by this Agreement. For the avoidance of doubt, the foregoing shall not require any Party to provide any transition or similar assistance that is not otherwise required under this Agreement.
SECTION 2.02. Contract Managers and Service Managers . Each Party shall appoint an individual to act as its primary point of contact for the administration of this Agreement (each, a “ Contract Manager ”). Distributing designates Steven Berns as its initial Contract Manager and Publishing designates John Bode as its initial Contract Manager. For each functional category identified on the Transition Service Schedules, each Party shall appoint one or two individual(s) to act as its primary point(s) of operational contact for the administration and operation of this Agreement with respect to the Transition Services identified under such functional category on the applicable Transition Service Schedule (each, a “ Service Manager ”) who shall have overall responsibility, with respect to the Transition Services identified under such functional category on the applicable Transition Service Schedule, for ( a ) coordinating all activities undertaken by such Party hereunder, ( b ) acting as a day-to-day contact with the other Party, ( c ) making available to the other Party the data, facilities, resources and other support services required for the performance of the applicable services in accordance with the terms of this Agreement and ( d ) attempting to resolve disagreements with respect to such Transition Services. The initial Services Managers for the Parties are set forth in the Transition Service Schedules. The Parties may change their respective Contract Managers and Service Managers from time to time upon notice to the other Party in accordance herewith.
SECTION 2.03. Change in Service . Any request for a change to a Transition Service shall be submitted in writing by the requesting Party to the other Party describing the proposed change in reasonable detail. The Party receiving such request shall respond to the request as soon as practicable and the Parties shall discuss in good faith the requested change and the process for implementing such change, including any changes in costs and expenses, if applicable; provided , that the Party receiving such request shall have no obligation to agree to such request if the change requested would materially and adversely impact the cost, liability, or risk associated with providing or receiving the applicable Transition Service, or cause any other material disruption or adverse impact on the business or operations of the Party or its Affiliates receiving the request. Each agreed upon change shall be documented by an amendment in writing to the applicable Transition Service Schedule.
 
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SECTION 2.04. Service Levels .
(a) Except as specifically provided in the applicable Transition Service Schedule for a specific Transition Service, the Transition Services shall be provided in a commercially reasonable manner and at a level substantially consistent with the level at which such Transition Services were provided (if applicable) to the Recipients in the Reference Period (taking into consideration any changes to service levels resulting from any changes to applicable Law after the date hereof).
(b) Subject to Sections 2.05 and 7.01 , if a Recipient provides a Provider with written notice of the occurrence of any Significant Service Shortfall (as defined below), such Provider shall promptly, and in no event more than five (5) Business Days from the date of such notice, for no additional charge, use commercially reasonable efforts to rectify or cause to be rectified such Significant Service Shortfall. In addition to any other rights the Recipient may have pursuant to this Agreement, if the Provider fails to rectify or cause to be rectified such Significant Service Shortfall in accordance with the foregoing, such Recipient may obtain replacement services from a third party and such Provider shall pay the reasonable cost of any such replacement services, less the amount such Recipient would have paid pursuant to this Agreement for such Transition Services. For purposes of this Section 2.04(b) , a “ Significant Service Shortfall ” shall be deemed to have occurred if, subject to Section 2.05(c) and the proviso in clause (a) of Section 3.02 , the quality or performance of the Transition Services provided by a Provider hereunder falls materially below the standards required by Section 2.04(a) .
SECTION 2.05. Limitation on Transition Services .
(a) A Provider shall not be required to provide Transition Services hereunder to the extent the provision of such services would require the Provider to violate any applicable Law or any Contract to which the Provider is a party; provided , that such Provider shall use commercially reasonable efforts to obtain, at the expense of the Provider, any waivers, permits, consents, orders or authorizations that may be required for the provisions of the Transition Services (the “ Consents ”); and provided , further , that to the extent such Provider is unable to obtain a Consent necessary to provide a Transition Service, the Provider shall, at the Recipient’s request and expense, use commercially reasonable efforts to cooperate with the Recipients to obtain as promptly as practicable alternative arrangements for the provision of the applicable Transition Service.
(b) Notwithstanding anything herein to the contrary, to the extent the provision of any Transition Services hereunder would require any Deferred Transfer Asset to which such Provider is entitled pursuant to the Separation Agreement, such Provider shall not be required to provide such services for so long as the transfer or assignment of such Deferred Transfer Asset is not consummated, whether as a result of a Transfer Impediment pursuant to the provisions of Section 5.3(a) of the Separation Agreement or for any other reason.
(c) The Recipients shall cooperate with the Providers to the extent necessary or appropriate to facilitate the performance of the Transition Services in accordance herewith. Without limiting the generality of the foregoing, ( i ) the Recipients shall make available on a timely basis to the Providers all information and materials requested by such Providers to the
 
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extent reasonably necessary for the purposes of providing and receiving the Transition Services in accordance with this Agreement, ( ii ) the Recipients shall, upon reasonable notice, give the Providers reasonable access, during regular business hours and at such other times as are reasonably required, to the relevant premises and personnel to the extent reasonably necessary for the purposes of providing and receiving Transition Services and ( iii ) the obligations of the Providers to provide the Transition Services hereunder are conditioned upon such Providers (and the Third Party Contractors engaged by them) being provided with reasonable access to, and all necessary rights to utilize, the Recipients’ information, facilities, personnel, assets, systems and technologies to the extent reasonably requested by the relevant Providers as reasonably necessary for the performance of the Transition Services.
(d) Except as specifically provided in the applicable Transition Service Schedule for a specific Transition Service, in providing the Transition Services, no Provider shall be obligated to ( i ) hire any additional employees, ( ii ) maintain the employment of any specific employees or ( iii ) purchase, lease or license any additional facilities, equipment or software.
SECTION 2.06. Intellectual Property . Except as provided herein, in the Separation Agreement or in other Ancillary Agreements, each Party shall retain all right, title and interest in and to all of its Intellectual Property and nothing in this Agreement shall be deemed to grant to the other Party any such rights; provided , that to the extent permitted by applicable Law and existing contractual arrangements (subject to Section 2.05 ), each Party hereby grants (or shall cause its applicable Affiliates to grant) to the other Party and its applicable Affiliates a nonexclusive, revocable, nontransferable, world-wide, royalty-free right and license to such Intellectual Property, solely to the extent and for the duration necessary for the receipt or provision of the Transition Services in accordance with this Agreement (it being understood that each such license shall terminate immediately upon the termination of the relevant Transition Services); and provided , further , that unless the Parties agree otherwise, all Intellectual Property ( i ) created by the Provider in connection with a Transition Service during the Term of such Transition Service at the request and solely for the benefit of a Recipient and ( ii ) paid for by a Recipient shall be the property of such Recipient, and, to the extent title to any such Intellectual Property vests in the Provider by operation of Law, each Party hereby assigns (and shall cause any such other Provider to assign) to the relevant Recipient all of its right, title and interest in and to such Intellectual Property, and the Providers shall provide such assistance and execute such documents as the Recipients may reasonably request to assign to the relevant Recipient all of its right, title and interest in and to such Intellectual Property.
SECTION 2.07. Services Migration .
(a) The Providers shall, and shall use commercially reasonable efforts to cause any applicable Third Party Contractors to, assist the Recipients in connection with the transition from the performance of Transition Services by the Providers to the performance of such services by the Recipients or other third parties engaged by the Recipients, which may include assistance with the transfer of records, segregation and migration of historical data, the transition to non-Provider systems and cooperation with and assistance to any third party consultants engaged by the Recipients in connection with such transition (“ Migration Services ”), taking into account ( i ) the need to minimize the cost of such transition and the disruption to the ongoing business activities of the Parties and their Affiliates and ( ii ) the rights and interests of protecting Confidential Information and privilege in accordance with Article VI of the Separation Agreement (the “ Protected Interests ”).
 
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(b) Without limiting the generality of the foregoing, as soon as practicable after the date hereof, each Party shall, at its sole expense, in compliance with applicable Laws, take such action with respect to the systems that are under its control to separate logically and physically the Information Technology used to conduct the Distributing Business from the Information Technology used to conduct the Publishing Business, in such a manner that the Information Technology used to conduct the Publishing Business is not accessible to the members of the Distributing Group and the Information Technology used to conduct the Distributing Business is not accessible to the members of the Publishing Group, except, subject to and in accordance with Section 6.02 , as and to the extent such access is necessary for the provision or receipt of Transition Services pursuant to this Agreement or as otherwise set forth herein.
SECTION 2.08. Limited Remedy and Limitation of Damages .
(a) In the event that any Provider materially fails to perform any Transition Service in breach of this Agreement, then at the Recipient’s request, the Provider shall use commercially reasonable efforts to re-perform such Transition Service as soon as reasonably practicable, with the same degree of care used in correcting a failure of a similar service for itself, at no cost to the Recipient. The Provider shall have no obligation to recreate any lost or destroyed data, but will provide such data to Recipient to the extent the same is re-created through such re-performance of Transition Services. Except ( i ) as provided in Section 2.04(b) , ( ii ) for any failure to perform that results in a claim for indemnification under Article IV and subject to the provisions thereof and ( iii ) for any specific performance or other equitable remedy that may be awarded by a court of competent jurisdiction, the Recipient’s sole and exclusive remedy, and the Provider’s sole and exclusive liability and obligation, with respect to the performance (or nonperformance) of Transition Services is set forth in the first two sentences of this Section 2.08 .
(b) EACH RECIPIENT ACKNOWLEDGES THAT ( I ) EACH PROVIDER IS NOT A COMMERCIAL PROVIDER OF THE TRANSITION SERVICES PROVIDED HEREIN AND IS PROVIDING THE TRANSITION SERVICES AS AN ACCOMMODATION AND AT COST TO THE RECIPIENT PARTIES IN CONNECTION WITH THE TRANSATIONS CONTEMPLATED BY THE SEPARATION AGREEMENT; AND ( II ) THIS AGREEMENT IS NOT INTENDED BY THE PARTIES TO HAVE THE APPLICABLE PROVIDER MANAGE AND OPERATE THE PUBLISHING BUSINESS OR THE DISTRIBUTING BUSINESS, AS APPLICABLE, IN LIEU OF THE APPLICABLE RECIPIENT. THE PARTIES AGREE THAT THE FOREGOING SHALL BE TAKEN INTO CONSIDERATION IN ANY CLAIM MADE UNDER THIS AGREEMENT.
 
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ARTICLE III
SERVICE CHARGES
SECTION 3.01. Service Charges . Unless otherwise set forth in the Transition Service Schedules and subject to Section 3.02 , the Transition Services and the Migration Services shall be provided at the Provider’s cost and expense. The Recipients shall compensate the Providers only for Transition Services and Migration Services actually received. The Recipients shall not make, or shall receive an appropriate credit with respect to, payment for Transition Services or Migration Services that are not provided to the Recipients for any reason, including force majeure.
SECTION 3.02. Invoices and Payment Terms . Unless otherwise set forth in the Transition Service Schedules, the Providers shall invoice the Recipients promptly after the end of each month for all ( a ) amounts due (if any) for all Transition Services and Migration Services provided to the Recipients during the preceding month based on, unless otherwise set forth in the Transition Service Schedules, the reasonable and documented out-of-pocket costs and expenses actually incurred by the Providers or any of its Affiliates in connection with providing the applicable Transition Services and Migration Services (including reasonable third party costs, travel-related expenses and increased staffing costs directly attributable to the provision of such services, but excluding fixed overhead and full time employee costs of the Provider); provided , however , that any such cost or expense not consistent with historical practice between the Parties for any Transition Service or Migration Service (including business travel and related expenses) shall require advance approval of the Recipient, which approval shall not be unreasonably withheld or delayed (it being agreed that in the event that, and for so long as, the Recipient withholds such approval, the Provider shall not be required to provide all or a portion of the applicable Transition Services and / or Migration Services to the extent that such cost or expense is necessary for the provision of such Transition Services and / or Migration Services or such portion thereof), and ( b ) all Taxes (as defined below). Payment of any amounts due by the Recipients hereunder shall be made in immediately available funds within forty-five (45) days of the applicable Recipient’s receipt of invoice therefor. Any amount not paid within forty-five (45) days after the date when payable shall bear interest at the rate equal to 1.5% per annum from the date such amount is due. The Recipients shall not deduct, set off, counterclaim or otherwise withhold any amount owed by it to the Providers (on account of any obligation owed by the Providers, whether or not such obligation has been finally adjudicated, settled or otherwise agreed upon in writing) against the amounts payable pursuant to this Agreement; provided , that in the event any Recipient disputes any amount on an invoice, such Recipient shall notify the relevant Provider in writing within twenty (20) days after such Recipient’s receipt of such invoice and shall describe in detail the reason for disputing such amount. Upon receipt of such notice, the Provider will research the items in question in a reasonably prompt manner and cooperate to resolve any differences with the Recipient. In the event agreement is not reached by the applicable Provider and Recipient within forty-five (45) days after receipt of the notice referred to above, the matter shall be referred to resolution in accordance with Section 7.05 . The Recipient will be entitled to withhold the amount in dispute during the pendency of the dispute, provided that the Recipient shall be subject to late charges pursuant to this Section 3.02 on any
 
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amount that is unsuccessfully disputed. The Recipient shall timely pay the undisputed portion of each invoice in the manner set forth in this Agreement; provided that in the event that the applicable Provider and Recipient mutually agree that any amount that was paid by the Recipient was not properly owed, the Provider will refund that amount plus interest (accumulating from the original due date for such amount at the rate equal to 1.5% per annum) to the Recipient within forty-five (45) days after receipt of such notice (or, alternatively, the Provider may deduct the dollar amount from the next invoice submitted to the Recipient).
SECTION 3.03. Documentation; Audit . The Providers shall maintain accurate and complete records of all receipts, invoices, reports and other documents relating to the Transition Services and Migration Services rendered hereunder (collectively, the “ TSA Documents ”) in accordance with ( i ) each such Person’s standard accounting practices and procedures, consistently applied, which practices and procedures are employed by each such Person in its provision of services for itself and its own Subsidiaries and ( ii ) applicable Law (including data protection and privacy Law). Without limiting the generality of the foregoing, each such Person’s accounting records shall be maintained in sufficient detail to enable an auditor to verify the accuracy, completeness and appropriateness of all charges hereunder. Upon reasonable prior notice, during the applicable Provider’s regular office hours, each Recipient and its Representatives (including such Recipient’s internal and external auditors) shall have the right to, at such Recipient’s expense, inspect and copy the TSA Documents and audit the TSA Documents and related controls and processes, subject to the preservation of the Protected Interests. The Providers shall retain the TSA Documents and, subject to the preservation of the Protected Interests, make them available to the Recipients, their Representatives, and applicable Governmental Authorities for a period of six years from the close of each fiscal year during which Transition Services are provided. If an audit conducted by a Recipient or its Representative reveals an overbilling by the Provider and overpayment by the Recipient, and the Provider agrees with the results of the audit, the Provider shall reimburse the relevant Recipient within forty-five (45) days of receiving a copy of the audit and shall pay interest at a rate equal to 1.5% per annum for the period from the date the revealed overpayment was made until the date such revealed overpayment is reimbursed.
SECTION 3.04. Taxes . All sales tax, value-added tax, goods and services tax or similar tax (“ Taxes ”) (but excluding any Tax based upon the net income of a Provider, which shall be paid by such Provider) associated with the provision of any Transition Services will be separately stated on the relevant invoice and shall be paid by the Recipients in accordance with Section 3.02 . The Providers shall be responsible for paying any such Taxes to the appropriate tax authorities.
 
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ARTICLE IV
DISCLAIMER OF REPRESENTATIONS AND WARRANTIES; LIMITATIONS
OF LIABILITY; INDEMNIFICATION
SECTION 4.01. Disclaimer of Representations and Warranties . Except as expressly provided in this Agreement, the services to be provided hereunder are furnished on an as-is and where-is basis. Except as expressly provided in this Agreement, neither party nor any of their affiliates make any representation or warranty, whether express, implied or statutory, and each party (on behalf of itself and its affiliates) hereby disclaims any representation or warranty of any kind with respect to the services provided hereunder, including any warranty of condition, merchantability, accuracy, satisfactory quality, non-infringement, or fitness for any particular purpose.
SECTION 4.02. Limitations of Liability .
(a) Except for the indemnification claim provided under Section 4.04 , in no event shall any Party or any of its Affiliates have any Liability to the other Party or any of its Affiliates arising out of or in connection with this Agreement.
(b) Notwithstanding anything to the contrary, the aggregate Liability of the Providers to the Recipients arising out of or in connection with this Agreement shall not exceed the aggregate amount of the service charges paid or to be paid by the Recipients hereunder with respect to the services giving rise to such Liability. The Parties hereby waive and shall not assert, and shall cause the other Recipients to waive and not assert, claims for any such Liability in excess of such aggregate amount.
(c) IN NO EVENT SHALL ANY PARTY OR ANY OF ITS AFFILIATES BE LIABLE TO THE OTHER PARTY OR ANY OF ITS AFFILIATES FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE DAMAGES OR LOST PROFITS, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING NEGLIGENCE OR STRICT LIABILITY) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT SUCH DAMAGES ARE FORESEEABLE OR SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
SECTION 4.03. Third Party Contractors .
(a) In no event will any Party be liable for the products and services of any Third Party Contractors, except to the extent for which such Party is otherwise liable under this Agreement.
(b) Notwithstanding anything in this Agreement to the contrary, with respect to any Third Party Contractors, the Parties agree to reasonably and diligently cooperate to pass through to each Recipient, to the extent permitted by the applicable contracts, the benefit of any indemnities, representations and warranties under the applicable contracts with such Third Party Contractors. Upon request, the Provider agrees at its option to either ( i ) enforce its rights under such contracts, or ( ii ) grant to the Recipient rights of subrogation, to the extent permitted under the applicable contract(s), so that the Recipient may directly enforce the applicable contract(s) against the applicable Third Party Contractors. The Provider will under no circumstances be responsible for any failure by any Third Party Contractor to provide any remedies to which the Provider and the Recipient are entitled from the applicable Third Party Contractors. The Recipient will be responsible for its own costs and the cost incurred by the Provider in seeking or enforcing any rights or remedies with respect to any such Third Party Contractors for the benefit of Recipient.
 
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SECTION 4.04. Indemnity .
(a) Subject to the limitations on liability provided in Sections 4.01 , 4.02 and 4.03 , each Party agrees to indemnify, defend and hold harmless the other Party, its Affiliates and its and their respective Representatives, and each of the successors and assigns of any of the foregoing from and against any and all claims, actions, demands, judgments, losses, costs, expenses, damages and liabilities (including reasonable attorneys’ fees and other expenses of litigation) arising out of or resulting from the negligence, willful misconduct, bad faith, breach of confidentiality, violation of Law or infringement of a third party’s Intellectual Property, of (or by) it or its Affiliates, and its and their respective Representatives, and each of the successors and assigns of any of the foregoing, in each case in connection with this Agreement.
(b) Sections 10.5 through 10.8 of the Separation Agreement shall apply mutatis mutandis with respect to the indemnification provided hereunder.
ARTICLE V
TERM AND TERMINATION
SECTION 5.01. Term .
(a) This Agreement shall become effective on the Distribution Date and, unless terminated earlier pursuant to Section 5.02 , shall remain in full force and effect until all Transition Services are terminated in accordance herewith.
(b) The term (the “ Term ”) for each Transition Service shall commence on the Distribution Date and, unless terminated earlier pursuant to Section 5.02 below, shall continue until the earlier of ( i ) the period specified in the applicable Transition Service Schedule (or such longer period as may be mutually agreed upon by the Parties in writing after the date hereof) and ( ii ) the second (2nd) anniversary of the Distribution Date.
SECTION 5.02. Termination . All or a portion of a Transition Service may only be terminated prior to the conclusion of its Term as follows:
(a) by the Recipient for convenience upon thirty (30) days prior written notice to the Provider, provided , that the Recipient shall pay the applicable early termination charges pursuant to Section 5.03 ;
(b) by the mutual written agreement of the Recipient and the Provider;
(c) by either Distributing or Publishing for a material breach (including any payment default) of this Agreement by the other Party (or any other Recipient or any other Provider, as applicable) with respect to such Transition Service, provided , that if such breach is capable of being cured, only if such breach is not cured within forty-five (45) days after written notice from the terminating Party;
 
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(d) by either Distributing or Publishing if the other Party commences a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or shall make a general assignment for the benefit of creditors or shall take any corporate action to authorize any of the foregoing; or
(e) by either Distributing or Publishing if any involuntary case or other proceeding is commenced against the other Party seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and such involuntary case or other proceeding remains undismissed and unstayed for a period of 60 days, or an order for relief shall have been entered against the other Party.
SECTION 5.03. Early Termination Charges . Upon early termination of all or a portion of any Transition Service pursuant to Section 5.02(a) , the Recipient shall pay to the Provider early termination charges equal to the amount of the out-of-pocket expenses incurred by the Provider in order to discontinue earlier than originally anticipated the provision of such Transition Service or portion thereof. Such early termination charges may include wind-down costs, breakage fees, early termination fees or charges, minimum volume make-up charges, other start-up or wind-down costs incurred by the Provider that the Provider had anticipated would be paid for by the Recipient over the course of the originally contemplated term (or not incurred but for the Recipient’s early termination) or other amounts payable to third parties. The Provider shall use commercially reasonable efforts to minimize the existence and amount of such early termination charges; provided , that the foregoing obligations shall not alter or diminish the Recipient’s obligation to pay such early termination charges as reasonably incurred by the Provider in accordance with the terms hereof. All such termination charges shall be due and payable to the Provider in immediately available funds within forty-five (45) days of the Recipient’s receipt of any invoice therefor.
SECTION 5.04. Effect of Termination .
(a) Upon termination of all or a portion of any Transition Service in accordance with this Agreement and subject to Sections 5.03 and 5.04 , the Providers will have no further obligation to provide such terminated Transition Service or the terminated portion thereof, and the Recipients shall have no obligation to pay any service charges or other amounts relating to such Transition Service or the terminated portion thereof; provided , that the Recipients shall remain obligated to the Providers for ( i ) any service charges or other amounts owed and payable in respect of such terminated Transition Service provided prior to the effective date of the termination and ( ii ) any early termination charges pursuant to Section 5.03 .
 
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(b) In connection with the termination of all or a portion of any Transition Service, the provisions of this Agreement not relating solely to such terminated Transition Service shall survive any such termination. Without limiting the generality of the forgoing, the provisions of Article I (Definitions), Article III (Service Charges), Article IV (Disclaimer of Representations and Warranties; Limitations of Liability; Indemnification), Article VI (Confidentiality), and Article VII (General Provisions) and Section 2.06 (Intellectual Property), Section 5.03 (Early Termination Charges), and this Section 5.04 (Effect of Termination) shall survive the termination of any Transition Service or any portion thereof or the termination of this Agreement.
ARTICLE VI
COVENANTS
SECTION 6.01. Confidentiality . Sections 6.5 and 6.6 of the Separation Agreement shall be incorporated by reference herein, mutatis mutandis .
SECTION 6.02. Access to Computer Systems . If a Party to this Agreement (or any other Provider and any other Recipient) has access (either on-site or remotely) to the other Party’s or its Affiliates’ Information Technology in relation to the Transition Services, such Party shall limit such access solely to the use of such Information Technology for purposes of the Transition Services and shall not access or attempt to access the other Party’s or its Affiliates’ Information Technology other than those required for the Transition Services. Such Party shall limit such access to those of its and its Affiliates’ employees, agents or contractors with a bona fide need to have such access in connection with the Transition Services, and shall follow all of the relevant Party’s security and data protection rules and procedures for restricting access to its or its Affiliates’ Information Technology made available by the relevant Party. All user identification numbers and passwords disclosed to such Party or its Affiliates and any information obtained by such Party or its Affiliates as a result of such Party’s or its Affiliates’ access to and use of the other Party’s or its Affiliates’ computer systems shall be deemed to be, and treated as, Confidential Information hereunder and under the Separation Agreement. Each Party shall, and shall cause its Affiliates to, cooperate with the other Party in the investigation of any apparent unauthorized access to a Party’s or its Affiliates’ computer system or information stores.
SECTION 6.03. Privilege . The Parties recognize that legal and other professional services have been and will be provided prior to and following the Distribution Date that were or will be rendered for the collective benefit of each of the Parties to this Agreement. The Parties agree that their respective rights with respect to all privileged information in connection with such services shall be governed by Section 6.8 of the Separation Agreement.
 
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ARTICLE VII
GENERAL PROVISIONS
SECTION 7.01. Force Majeure Event . No Party shall have any liability or responsibility for any interruption, delay or other failure to fulfill any obligation (other than a payment obligation) under this Agreement so long as and to the extent to which the fulfillment of such obligation is prevented, frustrated, hindered or delayed as a consequence of circumstances of a Force Majeure Event; provided , that such Party (or such Person) shall have exercised commercially reasonable efforts to minimize the effect of a Force Majeure Event on its obligations. In the event of an occurrence of a Force Majeure Event, the Party whose performance is affected thereby shall give notice (orally or in writing) of suspension as soon as reasonably practicable to the other stating the date and extent of such suspension and the cause thereof, and such Party shall resume the performance of such obligations as soon as reasonably practicable upon the cessation of such Force Majeure Event and its effects. If a Provider or Third Party Contractor is unable to provide any of the Transition Services due to a Force Majeure Event, the Recipient shall be free to acquire such Transition Services from an alternate source, at the Recipient’s sole cost and expense, and without liability to the Provider or any relevant third party, for the period and to the extent reasonably necessitated by such non-performance and during the continuation of any agreement entered into with the provider of such Transition Service, and for that period that such Transition Service is provided by an alternate source, the Provider or any relevant third party shall have no obligation to provide such Service to the Recipient. For the avoidance of doubt, the Recipient shall not be obligated to pay the Provider or any relevant third party for such Transition Services during the period when the Provider or such third party is not providing such Transition Services. Notwithstanding the foregoing, in no event shall any of the Recipients be relieved of their payment obligations to the relevant Provider for any Transition Services delivered pursuant to the terms of this Agreement.
SECTION 7.02. Independent Contractor . Nothing contained in this Agreement will be deemed or construed as creating a fiduciary relationship or relationship of trust, joint venture or partnership between the Parties hereto. No Party is by virtue of this Agreement authorized as an agent, employee or legal representative of the other Party, and the status of the Parties with respect to each other shall at all times continue to be that of independent contractors. No Party will have any power or authority to bind or commit the other Party. No Party will hold itself out as having any authority or relationship in contravention of this Section 7.02 . All employees and representatives providing the Transition Services shall be under the direction, control and supervision of the Providers, and the Providers shall have the sole rights to exercise all authority with respect to such employees and representatives and in no event shall such employees and representatives be deemed to be employees or agents of the Recipients.
SECTION 7.03. Third-Party Beneficiaries . No provision of this Agreement is intended to confer any rights, benefits, remedies, obligations or liabilities hereunder upon any Person other than the Parties and their respective successors and assigns.
 
14

SECTION 7.04. Conflicting Provisions . In the event any provision of either Transition Service Schedule conflicts or is inconsistent with the provisions of this Agreement, the provisions of this Agreement shall be controlling unless and to the extent such Transition Service Schedule specifically provides to the contrary.
SECTION 7.05. Negotiation and Dispute Resolution . Any disputes among the Parties hereto arising under this Agreement shall be resolved pursuant to the dispute resolution procedures contained Article XI of the Separation Agreement as if such provision applied to the Parties hereto. In the event of any such dispute, the Recipient shall continue to pay for the Transition Services, in accordance with Section 3.02 , and the Provider shall continue to provide the Transition Services in accordance with the terms and conditions of this Agreement (subject to applicable third party contract terms and conditions), pending resolution of such dispute.
SECTION 7.06. Amendment . This Agreement and the Transition Service Schedules may not be amended, supplemented or terminated except by an agreement in writing signed by the Parties.
SECTION 7.07. Miscellaneous . Section 12.1(a) (Further Assurances), Section 14.2 (Expenses), Section 14.3 (Counterparts), Section 14.4 (Notices), Section 14.6 (Severability), Section 14.7 (Entire Agreement), Section 14.8 (Assignment), Section 14.10 (Governing Law; Jurisdiction), Section 14.11 (Waiver of Jury Trial), Section 14.12 (Headings), Section 14.13 (Interpretation), Section 14.14 (Specific Performance) and Section 14.17 (Waiver) of the Separation Agreement are incorporated by reference herein, mutatis mutandis .
 
15

IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first above written.

TRIBUNE COMPANY	
		
By:	 	 	
	 	Name:                                                                                     	
	 	Title:                                                                                       	
	
TRIBUNE PUBLISHING COMPANY	
		
By:	 	 	
	 	Name:                                                                                     	
	 	Title:                                                                                       	
 
16

Schedule A
Transition Service Schedule
(Distributing Services to Publishing)
Except as may otherwise expressly be set forth in this Transition Service Schedule, none of Distributing, its Affiliates that conduct the Distributing Business or any of their respective Representatives ( a ) is providing legal, financial, accounting or tax advice in connection with Transition Services performed pursuant to this Schedule A or the Agreement of which this Transition Service Schedule forms a part or ( b ) has any responsibility, as a result of providing such Transition Services or storing or maintaining any data referred to herein, or otherwise, to prepare or deliver any notification or report to any Governmental Authority or other Person on behalf of Publishing or any of its Affiliates that conduct the Publishing Business.
To the extent that knowledge transfer is reasonably required in connection with the provision or receipt of a Transition Service, but is not separately stated as an element of such Transition Service, such knowledge transfer shall be included in such Transition Service.
Nothing contained in this Schedule A shall modify or otherwise limit any of the respective rights or obligations of the Parties or any member of either Group under any access or similar provision contained in the Separation Agreement or any Ancillary Agreements. Any access granted pursuant to this Schedule A shall be provided ( x ) during regular business hours and at such other times as are reasonably required and ( y ) to the extent permissible by applicable Law.
To the extent applicable, capitalized terms used but not otherwise defined in this Transition Service Schedule shall have the meanings ascribed to them in the Agreement or, if not defined therein, the Separation Agreement.
 
I.	Functional Category: Technology	
Distributing’s initial Service Managers shall be David Giambruno, Jeff Sciackitano and Erik Burns and Publishing’s initial Service Managers shall be Ghalib Kassam, Will Rose and Kathy Beiriger.
Notwithstanding Section 3.02 of the Agreement, Publishing will reimburse Distributing for a portion of Distributing’s full time employee costs based on the percentage of such employees’ time spent providing the Transition Services included in this item I of this Schedule A to Publishing.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
1.	  	Data Center Use	  	•    Use of the 8 th floor data center space in the Tribune Tower until all infrastructure can be physically separated, including physical access through common areas and basic data center support
 
•    Three Publishing resources will reside on the 8th floor in the Tribune Tower until the expiration or termination of this Transition Service	  	180 days	  	Publishing’s Information Technology will support the actual infrastructure, all of which resides on Publishing’s network	
					
2.	  	IP Addresses	  	•    Use of ARIN’s publicly registered address space owned by members of the Distributing Group while Publishing works to exit from internet facing use of this space
 
•    Provide technical consulting services to assist in designing and planning the implementation of a solution to move Publishing’s devices off of the IP addresses described above during the term of this Transition Service	  	Until the 2 nd anniversary of the Distribution Date	  	Contracts are owned by Distributing
 
Publishing retains the right to use the address space on its internal network so long as it is not exposed to the internet	
 
1

Transition Service Schedule A

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
3.	  	Wide Area Network & Internet Access	  	•     Access to and support of any Distributing-owned circuits
 
•     Circuits to be terminated site-by-site once Distributing completes migration to a new carrier	  	365 days	  	Contract is owned by Distributing	
					
4.	  	Workday Interface & Data Conversion Services	  	Provide assistance to the project team led by Publishing offering select services for:
 
•     Design, development, and testing of identified portion of software interfaces
 
•     Development for identified portion of data extraction & conversion	  	270 days	  		
					
5.	  	Blackline	  	Access to the Distributing Blackline instance hosted service for Blue Lynx Media, LLC to perform application administration and reconciliations for Accounts Payable and Payroll	  	Until the 2 nd anniversary of the Distribution Date	  		
					
6.	  	Migration Services	  	Provide Migration Services as requested by Publishing, including, but not limited to, analysis and solution design, development, integration and testing, through a Statement of Work to be reasonably agreed upon by the Parties with pricing consistent with this Schedule B	  	Until the 2 nd anniversary of the Distribution Date	  		
					
7.	  	Domain Name License	  	•     Non-exclusive, worldwide, non-transferable, royalty-free license to access and use the second level domain tribune.com (including www.tribune.com) and any subdomains associated therewith (collectively, the “ Domain Name ”); provided that Publishing will:
 
•     Access and use the Domain Name solely for the maintenance of the subdomains as they exist as of the Distribution Effective Time
 
•     Not add new public subdomains to the Domain Name
 
•     Host the Domain Name (except the jump page described below) on Publishing’s domain name servers to support all of the subdomains that are to be transferred or migrated off the Domain Name during the Term of this Transition Service
 
•     Promptly transfer hosting of all parts of the Domain Name to Distributing upon the later of ( x ) the completion of the transfer or migration of all subdomains off the Domain Name and ( y ) the end of the Term of this Transition Service
 
•     Distributing will be responsible for registering the Domain Name, including extending beyond the current expiration to cover the Term of this Transition Service
 
•     Distributing will be responsible for creating and hosting a jump page converted from the Domain Name’s web page that will direct visitors to either Distributing’s new corporate web site or Publishing’s new corporate website (Publishing will provide Distributing with the link thereto)	  	Until the 2 nd anniversary of the Distribution Date	  	Distributing and Publishing will coordinate any change to the domain registrar or the Domain Name and Publishing will make any change requested by Distributing with respect to subdomains owned by Distributing and configured on Publishing’s domain name servers (Publishing should have the necessary permissions to update its registered domain name servers)	
					
8.	  	BigFix/IBM EndPoint Manager	  	Until Publishing can effectively transfer these responsibilities to internal staff:
 
•     Provide support and user account access for the Bigfix/IBM Endpoint Manager (IEM) environment
 
•     Provide technical assistance completing the BigFix/IEM project, advancing the Publishing and Media instances in parallel, including:
 
•     Build, maintain, patch, and support the overall BigFix/IEM service and infrastructure environment
 
•     Provide services to create fixlets for as-needed situations
 
•     Provide training and knowledge transfer (both oral and documentation) to technology staff on the BigFix/IEM infrastructure and components
 
•     Assist in enabling and implementing other available BigFix/IEM modules	  	120 days	  		
 
2

Transition Service Schedule A
 
II.	Functional Category: Human Resources	
Distributing’s initial Service Manager shall be Melanie Hughes and Publishing’s initial Service Manager shall be Gwen Murakami.

Ref.	  	Transition Service	  	Transition Service Description	 	Term	 	Remarks	
1.	  	Benefits Administration	  	Provide full benefits administration including:
 
•    Coverage (including plan administration) for eligible Publishing employees under medical, dental, vision, STD, LTD, life, FSA, HSA and all voluntary benefits (including AD&D) maintained by Distributing for the benefit of its employees, including COBRA and HIPAA administration, and compliance with reporting and disclosure pursuant to applicable Law
 
•    Coverage for eligible Publishing employees under Business Travel Accident Insurance policy (Group Policy # is BTA-120098) issued by Gerber Life Insurance Company and Employee Assistance Program maintained by Distributing for the benefit of its employees
 
•    Financial analyses of benefits plans
 
•    Administrative support for Publishing retirees covered by retiree health and welfare benefits—enrollment, administration and call-center
 
•    Administration of retiree drug subsidies with reimbursement of subsidies to be made to Publishing and accounting / reporting made to appropriate tax department personnel of Publishing
 
•    Assistance relating to transition from Distributing’s 401(k) plan to Publishing’s 401(k) plan, including access to data to be able to effect smooth enrollment to the extent required by applicable Law
 
•    Reporting of actual claims incurred that relate to Publishing employees, with such information as may be permitted by HIPAA or other applicable Law	 	Through 12/31/2014	 		
					
	  		  	•    Continued benefits coverage for employees on short and/or long-term disability whose date of disability occurs prior to the Distribution Date	 	Until the 2 nd anniversary of the Distribution Date	 		
					
2.	  	Compensation	  	•    Access to employee survey data and PayScale participated in and purchased for Distributing
 
•    Access to Towers Watson REWARD	 	Through 12/31/2014	 		
					
	  		  	•    Access to E-Trade for participants and compensation staff	 	90 days	 		
					
3.	  	Employee and Labor Relations	  	•    Ability to consult with employment and labor lawyers for history on open cases and litigation and labor contracts incurred prior to the Distribution Date
 
•    Access to files related to current and historic employment and labor litigation for actions against Publishing legal entities arising prior to the Distribution Date
 
•    Access to labor contracts, bargaining history files, arbitration, grievance history and related items
 
•    Access to Distributing employees as witnesses and historic expertise to help develop appropriate defenses and litigation strategy on cases brought for actions prior to the Distribution Date
 
•    Access to employee personnel files for Publishing employees    	 	Until the earlier of ( i ) the 2 nd anniversary of the Distribution Date and ( ii ) the final disposition of open litigation for legal matters	 		
					
	  		  	•    Access to Lee Hecht Harrison outplacement programs for involuntarily terminated Publishing employees	 	90 days	 		
 
3

Transition Service Schedule A

Ref.	  	Transition Service	  	Transition Service Description	 	Term	 	Remarks	
					
4.	  	Recruiting	  	Access to:
 
•   iCIMS,
 
•   Talentwise (including eVerify)
 
•   The Work Number
 
•   CareerBuilder for job postings	 	60 days	 		
					
5.	  	Benefits	  	Coverage under Distributing benefits programs for newly hired Publishing employees, including employees hired due to acquisition of new subsidiaries by Publishing under same terms as identified in Employee Matters Agreement and in Item II.1. (Benefits Administration) of this Schedule A	 	Through 12/31/2014	 		
					
6.	  	HR	  	Coordination and support of bankruptcy-related claims and litigation covering current and former Publishing employees	 	Until the 2 nd anniversary of the Distribution Date	 		
					
7.	  	Day Nine Consulting	  	Unless Publishing has, prior to the Distribution Date, entered into a separate agreement with Day Nine Consulting with respect to the implementation of Workday, use of Distributing’s agreement with Day Nine Consulting	 	Until the earlier of ( i ) 10/1/2014 and ( ii ) the date on which Publishing obtains a separate agreement with Day Nine Consulting with respect to the implementation of Workday	 	Notwithstanding Sections 3.01 and 3.02 of the Agreement, Publishing will reimburse Distributing for 50% of costs charged to Distributing under the Day Nine Consulting agreement	
 
4

Transition Service Schedule A
 
III.	Functional Category: Legal	
Distributing’s initial Service Manager shall be Sal Karottki and Publishing’s initial Service Manager shall be Julie Xanders.

Ref.	  	Transition Service	  	Transition Service Description	 	Term	 	Remarks	
1.	  	Legal	  	•   Access to personnel for history on open cases, litigation, claims, enforcement matters, contracting matters, licensing matters and other similar matters
 
•   Access to files related to current and historic litigation for Actions against members of the Publishing Group arising prior to the Distribution Date
 
•   Access to intellectual property files
 
•   Access to contracts and licenses relating to the Publishing Group’s intellectual property
 
•   Access to corporate files and documentation relating to entities comprising the Publishing Group or the Publishing Business Assets	 	Until the 2 nd anniversary of the Distribution Date	 		
 
5

Transition Service Schedule A
 
IV.	Functional Category: Internal Audit	
Distributing’s initial Service Manager shall be Thomas Caputo and Publishing’s initial Service Manager shall be Gregory Page.

Ref.	  	Transition Service	  	Transition Service Description	 	Term	 	Remarks	
1.	  	Information / Documentation	  	Access to information and documentation related to:
 
•   Transition Services or Migration Services provided to Publishing under the Agreement (including this Schedule A) with respect to the period during which such services were provided under the Agreement, and
 
•   similar services provided to Publishing prior to the Distribution Date	 	Until the 2 nd anniversary of the Distribution Date	 		
					
2.	  	Audit Scoping and Planning	  	Coordination on scoping and planning of test procedures related to then in-effect Transition Services or Migration Services provided to Publishing under the Agreement (including this Schedule A)	 	Until the expiration or termination of all applicable Transition Services and Migration Services	 		
					
3.	  	Audit Results / Reporting	  	Access to monitoring, test results and reports related to:
 
•   Transition Services or Migration Services provided to Publishing under the Agreement (including this Schedule A) with respect to the period during which such services were provided under the Agreement, and
 
•   similar services provided to Publishing prior to the Distribution Date	 	Until the 2 nd anniversary of the Distribution Date	 		
					
4.	  	Legal and Regulatory Compliance	  	Prompt notification of violations of laws, regulations, and policies (including ethics hotline calls and Code of Business Conduct violations) that impact Publishing	 	Until the 2 nd anniversary of the Distribution Date	 		
					
5.	  	Business Continuity / Disaster Recovery	  	Access to business continuity and disaster recovery plans and related test results related to then in-effect Transition Services or Migration Services provided to Publishing under the Agreement (including this Schedule A)	 	Until the expiration or termination of all applicable Transition Services and Migration Services	 		
					
6.	  	Processes / Controls	  	Prompt notification of identified significant process or control issues related to then in-effect Transition Services or Migration Services provided to Publishing under the Agreement (including this Schedule A)	 	Until the expiration or termination of all applicable Transition Services and Migration Services    	 		
 
6

Transition Service Schedule A

Ref.	  	Transition Service	  	Transition Service Description	 	Term	 	Remarks	
7.	  	Audit Support	  	Audit support for annual internal control certification process and the preparation of quarterly and annual GAAP financial statements	 	Until the 2 nd anniversary of the Distribution Date	 	To the extent that the audit support relates to a Transition Service subject to special pricing provisions pursuant to the terms of this Schedule A, such audit support shall be subject to such special pricing provisions	
 
7

Transition Service Schedule A
 
V.	Functional Category: Treasury	
Distributing’s initial Service Manager shall be Jack Rodden and Publishing’s initial Service Manager shall be Melanie Reese.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
1.	  	Cash Management	  	Consultations in connection with cash management, accounts and related treasury processes	  	90 days	  		
 
8

Transition Service Schedule A
 
VI.	Functional Category: Advertising and Marketing in Hartford Market	
Distributing’s initial Service Manager shall be Chris Geiger and Publishing’s initial Service Manager shall be Nancy Meyer.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Shared Advertising
Sales	  	Accept the following advertising sales made by Tribune Broadcasting Hartford, LLC (“ WTIC ”) employees in publications, on websites or on social media platforms managed by The Harford Courant Company, LLC (“ Hartford Courant ”):
 
•      event advertising sales for any specifically identified event mutually agreed upon by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager
 
•      all other advertising sales for a strategic and limited group of advertisers determined by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, such advertising sales will be provided at no charge (i.e., WTIC will pay and incur costs for bonuses and commissions paid to WTIC employees pursuant to these advertising sales and / or will be directly billed by the vendor)	
					
2.	  	WTIC Marketing	  	•      Broadcast channels, websites, social media platforms and signage managed by WTIC will present Hartford Courant marketing campaigns and Hartford Courant marketing campaigns will be determined by Hartford Courant’s Publisher subject to approval by WTIC’s Vice President & General Manager
 
•      WTIC will be responsible for the creation and expense of Hartford Courant broadcast campaign materials
 
•      WTIC talent appearances will be provided to Hartford Courant
 
•      The airing of Hartford Courant promotional spots or signage during on-air broadcasts will be followed by sponsorship identification to the extent required by applicable Law	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, there will be no charge to Hartford Courant for the broadcast campaign materials or WTIC talent appearances	
					
3.	  	Marketing Co-Branded / Shared
Events	  	Marketing co-branded/shared events will be completed and the specific co-branded/shared events will be mutually agreed upon by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, expenses will be incurred and recorded by Hartford Courant and WTIC respectively with no reimbursement	
 
9

Transition Service Schedule A
 
VII.	Functional Category: Procurement	
Distributing’s initial Service Manager shall be Kathy Jurgeto and Publishing’s initial Service Manager shall be John Cannizzo.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Office Supplies	  	Provide enterprise-wide office supply services and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
2.	  	Corporate T&E
Card	  	Provide enterprise-wide T&E corporate card services and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
3.	  	Food Service	  	Water cooler placement and service in the Tribune Tower	  	Through 12/31/2014	  		
					
4.	  	Telecom, Data,
Internet and
Wireless Bill
Payment	  	Provide enterprise telecommunication, data, internet and wireless bill payment services and corresponding administrative access, as needed	  	Through 6/30/2015	  		
 
10

Transition Service Schedule A
 
VIII.	  Functional Category: Risk Management	
Distributing’s initial Service Manager shall be Cara Leeman and Publishing’s initial Service Manager shall be Henry Segal.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Risk Management	  	•      Provide consulting and assistance to Publishing personnel as Publishing manages its own separate and distinct insurance policies, contracts and related processes
 
•      Although not expected, if certain insurance services initially require pass-through contracts rather than separate contracts, the primary vendor contact will be with Distributing and Distributing will manage the third party contract until a clean separation is effected	  	Through 12/31/2014	  		
 
11

Transition Service Schedule A
 
IX.	Functional Category: Real Estate	
Distributing’s initial Service Manager shall be Marina Shapira and Publishing’s initial Service Manager shall be Lucas Beals.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	MacMunnis Lease
Administration	  	Unless Publishing has, prior to the Distribution Date, entered into a separate agreement with MacMunnis Inc. (“ MacMunnis ”) with respect to lease administration, use of Distributing’s agreement with MacMunnis, including:
 
•    Software access
 
•    Income billing services, including payment by Distributing to Publishing of sublease rental income received from MacMunnis within 3 Business Days after Distributing’s receipt of the applicable funds from MacMunnis
 
•    Special research projects requested by Publishing	  	Until the earlier of ( i ) 12/31/2014 and ( ii ) the date on which Publishing obtains a separate lease administration agreement with MacMunnis	  		
					
	  		  	•    Rental payment services, including funding by Distributing to MacMunnis of Publishing’s monthly rental payments that have been previously approved by Publishing	  		  	Notwithstanding Section 3.02 of the Agreement, Publishing will reimburse Distributing for such funded amounts within 3 Business Days after Distributing’s applicable payment to MacMunnis	
					
	  		  	•    Annual audit of operating expenses and real estate tax reconciliation as requested by Publishing	  		  	Publishing will be responsible for MacMunnis’s contingency fee	
					
	  		  	•    Creation of lease abstracts for ( x ) Intercompany Leases, ( y ) leases, subleases and licenses for real property entered into after the Distribution Date and ( z ) amendments or modifications to any of the foregoing	  		  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, Publishing will reimburse Distributing for 50% of Distributing’s costs and expenses incurred in connection with providing such abstracts for net leases and amendments thereto (for the avoidance of doubt, charges for abstracts for gross leases and leases with third parties and amendments to any of the foregoing shall be governed by Sections 3.01 and 3.02 of the Agreement)	
 
12

Transition Service Schedule A

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
2.	  	Costa Mesa
Production Plant
Access	  	Access to the Distributing Group’s Costa Mesa Production Plant to allow Publishing personnel, at Publishing’s sole cost and expense, to remove all remaining production equipment and generators	  	Through 10/1/2014	  		
 
13

Schedule B
Transition Service Schedule
(Publishing Services to Distributing)
Except as may otherwise expressly be set forth in this Transition Service Schedule, none of Publishing, its Affiliates that conduct the Publishing Business or any of their respective Representatives ( a ) is providing legal, financial, accounting or tax advice in connection with Transition Services performed pursuant to this Schedule B or the Agreement of which this Transition Service Schedule forms a part or ( b ) has any responsibility, as a result of providing such Transition Services or storing or maintaining any data referred to herein, or otherwise, to prepare or deliver any notification or report to any Governmental Authority or other Person on behalf of Distributing or any of its Affiliates that conduct the Distributing Business.
To the extent that knowledge transfer is reasonably required in connection with the provision or receipt of a Transition Service, but is not separately stated as an element of such Transition Service, such knowledge transfer shall be included in such Transition Service.
Nothing contained in this Schedule B shall supersede, modify or otherwise limit any of the respective rights or obligations of the Parties or any member of either Group under any access, record retention or similar provision contained in the Separation Agreement or any Ancillary Agreements. Any access granted pursuant to this Schedule B shall be provided ( x ) during regular business hours and at such other times as are reasonably required and ( y ) to the extent permissible by applicable Law.
To the extent applicable, capitalized terms used but not otherwise defined in this Transition Service Schedule shall have the meanings ascribed to them in the Agreement or, if not defined therein, the Separation Agreement.
 
I.	Functional Category: Technology	
Distributing’s initial Service Managers shall be David Giambruno, Jeff Sciackitano and Erik Burns and Publishing’s initial Service Managers shall be Ghalib Kassam, Will Rose and Kathy Beiriger.
Notwithstanding Section 3.02 of the Agreement, ( a ) Distributing will reimburse Publishing for a portion of Publishing’s full time employee costs based on the percentage of such employees’ work in connection with providing the Transition Services included in this item I of this Schedule B to Distributing and ( b ) Distributing will reimburse Publishing for out-of-pocket or third party costs incurred by Publishing to make repairs to, or replacements of, equipment or systems to the extent that such repairs or replacements have become, through no fault of Publishing, necessary for the provision of any Transition Service included in this item I of this Schedule B, provided that such reimbursement amount shall be limited to the proportionate share of the utilization of such equipment or systems represented by the Transition Services in this item I of this Schedule B (taking into account the remaining Term of the applicable Transition Service).
Notwithstanding Article II of the Agreement, the Provider may reduce the level of service provided pursuant to this item I of this Schedule B in a manner that is consistent with a reduction of the level of service provided to the Provider’s own business resulting from a reduction in the Provider’s workforce, provided that ( x ) in the event of such a reduction in the level of service provided to the Recipient, the Recipient shall have the right to require that the Provider obtain additional third party staffing to the extent necessary to return to the service levels that would be required but for this provision (it being understood that ( i ) such additional third party staffing will be directed and managed by the Provider, but will be completely dedicated to providing Transition Services for Recipient’s benefit under the Agreement, and ( ii ) the Recipient shall be charged for the costs and expenses of such additional third party staffing pursuant to Section 3.02 of the Agreement) and ( y ) the Provider shall notify the Recipient of any change in service levels pursuant to this provision and, at the Recipient’s request, shall provide service statistics and policy statements evidencing then-current service levels of the Provider’s business.
Upon the expiration of the Transition Services included in items 15, 36 and 37 of this item I of this Schedule B, Distributing will reimburse Publishing for wind-down costs incurred by Publishing to the extent resulting from the expiration of Recipient’s use of such Transition Service. The Provider shall use commercially reasonable efforts to minimize the existence and amount of such wind-down costs; provided , that the foregoing obligations shall not alter or diminish the Recipient’s obligation to pay such wind-down costs as reasonably incurred by the Provider in accordance with the terms hereof. All such wind-down costs shall be due and payable to the Provider in immediately available funds within forty-five (45) days of the Recipient’s receipt of any invoice therefor.
 
1

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Reporting, Interface and Configuration Changes related to Separation	  	Provide any break/ fix reporting, interface or other configuration changes required due to the split of or transition from systems and technologies under the Agreement related to the Business Separation	  	365 days	  		
					
2.	  	Underlying Services	  	Subject to the limitations described in the second bullet below, provide any underlying services needed to provide end-state services for all other items provided under the Agreement (including this Schedule B), including, but not limited to:
 
•      any and all supporting technical services, applications, datamarts, reporting and interfaces to related systems that exist as of the Distribution Date
 
•      support and maintenance of underlying infrastructure including servers, databases, network, firewalls, storage, data center and other technology components, as well as monitoring, security, disaster recovery, data retention and service management processes required to deliver full service, which includes resolution of break/ fix service interruptions and use of commercially reasonable efforts to mitigate security vulnerabilities, but excludes programming changes to change behavior or correct existing bugs, increases in disk capacity, processing capacity or network bandwidth and other enhancements and upgrades	  	365 days	  		
					
3.	  	Monitoring of Solutions and Environments	  	•      Monitoring of systems and environments provided under the Agreement (including this Schedule B)
 
•      Providing timely alerts to Distributing’s Service Manager
 
•      Providing output from monitoring tools when requested	  	365 days	  		
					
4.	  	Security, Controls and Compliance	  	Maintain effective security, controls and compliance over all systems and environments provided under the Agreement (including this Schedule B), including:
 
•      regular penetration testing and intrusion detection of such applications and environments
 
•      compliance with SOX and other applicable internal control structures and Laws	  	365 days	  		
					
5.	  	Integrations for New Solutions	  	•      Design, develop, test and implement integrations to systems provided under the Agreement (including this Schedule B) for new Distributing business solutions as required, excluding Migration Services provided pursuant to Section 2.07 of the Agreement
 
•      Distributing may execute the required work described in the preceding bullet through a Statement of Work if Publishing does not have the required resources available to meet a requested delivery date and Publishing will provide additional access necessary to deliver the solution	  	365 days	  		
 
2

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
6.	  	Access to Applications	  	•      Access to and support for the Citrix environment used by Distributing to access applications supported by Publishing, including:
 
•      Application management / installation
 
•      Maintenance of proper load balance of resources
 
•      Incident and problem management and escalation services
 
•      Required authentication configuration changes related to the migration of domains during the applicable Term
 
•      Access to applications and functions that cannot be handled via Citrix	  	365 days	  		
					
7.	  	PeopleSoft HCM	  	•      Access to and support for the following HCM related applications: PeopleSoft Human Resources, Benefits, Payroll, eBenefits, ePay, Non-Employees, My Time Off, New Hire Bridge, PAF, SuccessFactors, Cypress report distribution and Business Objects Datamarts
 
•      Pulling data out of consolidated datamarts to be provided only one time
 
•      Create a HR data archive	  	270 days	  		
					
	  		  	•      Post-deployment support and close-out activities for the project to separate PeopleSoft HCM, as set forth in the project’s Deployment and Project Plans	  	30 days	  		
					
8.	  	Workday Solution Delivery	  	•      Supplemental assistance and services to aid Distributing and DayNine Consulting, Distributing’s primary contractor, in their effort to deliver Distributing’s Workday solution
 
•      Assistance for the following project related services:
 
•      Business analysis and software development for data extraction and conversion, migration and validation
 
•      Design, development and testing of software interfaces
 
•      Testing and quality assurance for system, data conversion, performance and user acceptance
 
•      Consulting from Publishing HR resources to support setup and testing of the system by Distributing
 
•      Project management and business analysis coordination to deliver the solution	  	270 days	  		
					
9.	  	PeopleSoft Financials	  	•      Access to and support for the following finance related applications: General Ledger, Asset Management, Travel and Entertainment, Accounts Payable, Essbase, NVision, Business Objects datamarts and Cypress report distribution
 
•      Pulling data out of consolidated datamarts to be provided only one time
 
•      Create a financial data archive	  	270 days	  		
 
3

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
	  		  	•      Post-deployment support and close-out activities for the project to separate PeopleSoft Financials, as set forth in the project’s Deployment and Project Plans	  	45 days	  		
					
10.	  	Kronos	  	Access to and support for the following time keeping related applications:
 
•      Tribune Media Services, LLC (“ TMS ”) Kronos (application support resource only)
 
•      Publishing/Broadcasting Kronos	  	365 days	  		
					
11.	  	Triblink	  	Access to and support for all applications accessed via Triblink including, but not limited to: ePay, eBenefits, Onbase, New Hire Bridge, PAF, Vanguard, Kronos, SharePoint, Benefits Service Center, ticket tracking, Employee Directory, Internal Job Search, Tax Reporting and Withholding, My Expense Center, Travel Services, Password Manager (“USA” domain only), PeopleSoft HCM, PeopleSoft Financials, Broadcasting Financial Reporting, data loader, Tribune@home, MAAX, HR Web service (but excluding the Technology Help Desk Ticket and chat services for end-users)    	  	270 days	  		
					
12.	  	Blackline	  	Access to and support for Distributing’s Blackline hosted service application (administration) and interfaces back to applications supported by Publishing	  	270 days	  		
					
13.	  	SCC Media Server	  	Access to and infrastructure support for SCC Media Server (Digital Asset Management) instances running in Publishing environments, excluding application support	  	90 days	  		
					
14.	  	SCC Media Server Solution Delivery	  	•      Supplemental assistance and services to aid Distributing in its effort to deliver Distributing’s SCC Media Server solution, split from the current Publishing instance
 
•      Assistance for the following project related services:
 
•      Business analysis and software development for data extraction and conversion, migration and validation
 
•      Design, development and testing of software interfaces
 
•      Testing and quality assurance for system, data conversion, performance and user acceptance
 
•      Consulting from business resources to support setup and testing of the system by Distributing
 
•      Project management and business analysis coordination to deliver the solution	  	90 days	  		
 
4

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
15.	  	Data Direct	  	Access to and support for infrastructure that supports Data Direct (“Tmsdatadirect.com” domain owned and supported by Distributing)	  	150 days	  	Reflects 11/2014 replacement plan
Distributing will provide application level support	
					
16.	  	API Pack	  	Access to and support for infrastructure that supports the API Pack application	  	90 days	  	Distributing will provide application level support	
17.	  	SharePoint	  	Access to and support for the SharePoint environment, including:
 
•      Access to sites
 
•      SSRS reporting services utilized for any applications or datamarts provided under the Agreement
 
•      Transfer related sites, reports, content or data residing in SharePoint to be provided only one time	  	270 days	  		
					
18.	  	Active Directory	  	•      Access to Distributing dedicated devices residing on any Publishing domains during the applicable Term
 
•      Access to and support for the “USA” Active Directory environment, including:
 
•      Trusts and federation, where required, between “USA”, “LocalTVllc” and “Tribunemedia” Active Directory domains or access required during the applicable Term
 
•      User provisioning and de-provisioning in the dual domain environment as long as “USA” domain credentials are required to access applications provided under the Agreement
 
•      “LocalTVllc” domain exception process for user provisioning and de-provisioning until “LocalTVllc” domain is migrated to the “Tribunemedia” domain and is included in regular provisioning and de-provisioning processes
 
•      Interface, provisioning and migration tool changes to accommodate transition of solutions during the applicable Term	  	270 days	  		
					
19.	  	Email / Instant Messaging	  	Access to and support for Publishing’s instance of Exchange and Lync Instant Messaging environments	  	90 days	  		
					
20.	  	Network WiFi	  	Access to and support for Aruba WiFi and controllers	  	180 days	  		
					
21.	  	Wide Area Network, Point-to-Point and Internet Access	  	Access to and support of any Publishing-owned circuits	  	365 days	  	Tied to circuit replacement plan	
 
5

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
22.	  	Local Area Network Access and Transit	  	•       Access to Publishing’s LAN/WAN and distribution layer, with data transit across Publishing’s network primarily via static routes (dynamic routes only to be used if required for special circumstance and agreed upon by Publishing), until all equipment and cabling can be separated
 
•       Access to network gear will be controlled for both Publishing and Distributing	  	365 days	  		
					
23.	  	Internal and External DNS and DHCP	  	•       Provide DNS and DHCP services and support until a permanent solution is deployed for Distributing
 
•       Access to and support for Infoblox and IPPlanner as required to migrate to new circuits for Distributing	  	180 days	  		
					
24.	  	IP Addresses	  	Use of ARIN’s publicly registered address space owned by members of the Publishing Group while Distributing works to exit from internet facing use of this space	  	Until the 2 nd anniversary of the Distribution Date	  	Distributing retains the right to use the address space on its internal network so long as it is not exposed to the internet	
					
25.	  	Telecom – Asterisk	  	•       Asterisk support
 
•       Vicidial support
 
•       Audio Code support	  	180 days	  		
					
26.	  	Telecom – Avaya	  	Avaya support	  	180 days	  		
					
27.	  	File Storage and Print System	  	Access to and support for file and print services	  	90 days	  		
 
6

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
28.	  	Supplemental Technology Support for WTIC (Hartford and New Haven)	  	Provide Tribune Broadcasting Hartford, LLC (“ WTIC ”) with technology related access and supplemental support for the primary Hartford Courant location and the New Haven location until WTIC can be effectively split from The Hartford Courant Company, LLC (“ Hartford Courant ”)	  	180 days	  		
					
29.	  	ADIT and Dynamics CRM (WGN-Radio)	  	Provide WGN Continental Broadcasting Company, LLC (with respect to WGN-Radio) with access to and support for the following Advertising related applications: ADIT and Dynamics CRM (Raptor)	  	90 days	  		
					
30.	  	Supplemental Technology Support for WSFL and TMS (South Florida)	  	Provide WSFL, LLC (“ WSFL ”) and TMS with technology related access and support for the Deerfield Beach location and the downtown Ft. Lauderdale location until WSFL and TMS can be effectively split from Sun Sentinel Company, LLC	  	365 days	  		
					
31.	  	Wide Orbit Media Sales	  	Network access to get to Wide Orbit Media Sales (WOMS)	  	180 days	  		
					
32.	  	Help Desk and Service Manager	  	•      Inbound call handling and ticket management for applications provided under the Agreement (including this Schedule B)
 
•      Inbound call handling and ticket management for misrouted calls and/or tickets during the applicable Term
 
•      Call system options to re-direct Distributing users to Distributing’s Help Desk
 
•      Access to full Service Manager client via Citrix for Distributing’s technology support staff
 
•      Access to Service Manager web portal for ticket creation via Citrix for Distributing’s technology support staff
 
•      Interface creation and support for auto ticket creation between Distributing’s Gemini Tracker and Service Manager
 
•      Interaction with Distributing’s Help Desk to handle bi-directional hand-off and follow-up of tickets in the dual environment during the applicable Term
 
•      User access requests
 
•      Call and incident reporting
 
•      Access to three-year history of call volume, call types and Service Manager ticket detail to be provided only one time	  	365 days	  		
 
7

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
33.	  	Workspace and Internet Connectivity	  	•      Access to and support for space, including physical access and network and telecommunication access and support, from Orlando Sentinel Communications Company, LLC at Publishing’s Help Desk for the provision by Distributing of support services between Distributing’s Help Desk and Publishing’s Help Desk
 
•      Access to and support for space, including physical access and network and telecommunication access and support, from Los Angeles Times Communications LLC on the western side of the 7 th floor at its downtown building	  	365 days	  	Network connection to be provided via a segregated Publishing network with need to utilize virtual private networking software to access Distributing software	
					
34.	  	Freedom Center Data Center Use	  	Use of the data center space in the Freedom Center to hold infrastructure for Distributing’s disaster recovery until data circuits can be installed in Distributing’s backup data center, including physical access, network connectivity and basic data center support	  	180 days	  	Distributing’s Information Technology will support the actual infrastructure, all of which resides on Distributing’s network	
					
35.	  	Tribune Tower and Freedom Center Building Security System	  	Access to and support for the security systems for the Tribune Tower and the Freedom Center until replaced by Distributing	  	365 days	  		
					
36.	  	Wide Orbit	  	Access to and support for infrastructure that supports Wide Orbit application, unless Distributing has given notice prior to the Distribution Date that this Transition Service is no longer needed	  	60 days	  	Distributing will provide application and database level support	
					
37.	  	Zap2It	  	Access to and support for infrastructure that supports the Zap2It application	  	90 days	  	Distributing will provide application level support	
38.	  	Migration Services	  	Provide Migration Services as requested by Distributing, including, but not limited to, analysis and solution design, development, integration and testing, through a Statement of Work to be reasonably agreed upon by the Parties with pricing consistent with this Schedule B	  	Until the 2 nd anniversary of the Distribution Date	  		
					
39.	  	Akamai	  	•      Use of Publishing’s agreement with Akamai until Distributing’s configuration can be migrated into a separate agreement, unless Distributing has given notice prior to the Distribution Date that this Transition Service is no longer needed
 
•      Access to and support for modifications to content provider codes and other configuration related to the Distributing Business Assets
 
•      Support for and assistance with migrating into a separate agreement the content provider codes and other configuration used by Distributing	  	60 days	  		
 
8

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
40.	  	Profisee	  	•      Access to and support for Profisee until Distributing’s configuration can be migrated into a separate agreement, unless Distributing has given notice prior to the Distribution Date that this Transition Service is no longer needed
 
•      Support for and assistance with migrating into a separate agreement the configuration used by Distributing	  	60 days	  		
					
41.	  	Financial Support	  	Provide financial consulting services for Distributing’s technology function, as needed	  	90 days	  		
 
9

Transition Service Schedule B
 
II.	Functional Category: Human Resources	
Distributing’s initial Service Manager shall be Melanie Hughes and Publishing’s initial Service Manager shall be Gwen Murakami.
Notwithstanding Section 3.02 of the Agreement, Distributing will reimburse Publishing for a portion of Publishing’s Compensation Manager’s and Publishing’s Senior Manager of Workforce Data’s respective salaries based on the percentage of such Publishing’s Compensation Manager’s and Publishing’s Senior Manager of Workforce Data’s respective time spent providing services to Distributing.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Compensation	  	Access to Publishing’s Compensation Manager, Jennifer Bozarth, for 50% of her time	  	Through the later of ( x ) 9/1/2014 and ( y ) Ms. Bozarth’s last day at Publishing (if she resigns)	  		
					
2.	  	HR Systems	  	•      Limited telephonic support of PeopleSoft set up and ancillary systems (including SuccessFactors, PAF and New Hire Bridge) on an ad-hoc, as needed basis and as time allows until implementation of Workday is complete
 
•      Continued joint participation, at no charge, in sessions and efforts to implement Workday, with the understanding that Distributing employees will focus on Distributing’s needs and Publishing employees will focus on Publishing’s needs and will diverge to the extent necessary to satisfy each Party’s unique business requirements	  	Through 10/31/2014	  	Publishing’s Senior Manager of Workforce Data to provide HR Systems services for up to 50% of her time	
 
10

Transition Service Schedule B
 
III.	Functional Category: Legal	
Distributing’s initial Service Manager shall be Sal Karottki and Publishing’s initial Service Manager shall be Julie Xanders.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Legal	  	•    Access to personnel for history on open cases, litigation, claims, enforcement matters, contracting matters, licensing matters and other similar matters
 
•    Access to files related to current and historic litigation for Actions against members of the Distributing Group arising prior to the Distribution Date
 
•    Access to intellectual property files
 
•    Access to contracts and licenses relating to the Distributing Group’s intellectual property
 
•    Access to corporate files and documentation relating to entities comprising the Distributing Group or the Distributing Business Assets	  	Until the 2 nd anniversary of the Distribution Date	  		
 
11

Transition Service Schedule B
 
IV.	Functional Category: Blue Lynx Media, LLC	
Distributing’s initial Service Manager shall be Jim Fernandez and Publishing’s initial Service Manager shall be Dan Sawyers.
Notwithstanding Section 3.02 of the Agreement, Distributing will reimburse Publishing for a portion of Publishing’s full time employee costs based on the percentage of such employees’ work in connection with providing the Transition Services included in this item IV of this Schedule B to Distributing.
Unless otherwise agreed by the Parties, from and after the Distribution Date, Publishing shall measure and report, on a monthly basis in accordance with methods mutually agreed upon by the Parties, each of the twelve service levels as separately agreed between the Parties (collectively, the “ Service Levels ”) and Publishing’s actual performance of the Transition Services included in this item IV of this Schedule B, including a comparison of such actual performance to the applicable Service Level. Publishing recognizes that its failure to meet any of the Service Levels in providing the Transition Services included in this item IV of this Schedule B could have a material adverse impact on the business and operations of Distributing and that the damages resulting from Publishing’s failure to meet such Service Levels are not capable of precise determination. Accordingly, in addition to any other rights and remedies at Law or in equity available to Distributing pursuant to the Agreement (including Section 2.04 of the Agreement), if Publishing fails to meet any of the Service Levels, then Publishing shall, as compensation for Distributing’s damages and not as a penalty, provide to Distributing credits as follows: if Publishing fails to meet a Service Level for any two (2) months out of a rolling three (3) month period, a credit will be provided based on one twelfth (or 8.33%) of the then-current month’s aggregate billing amount (it being understood that ( A ) such any such credits shall only apply for the twelve identified Service Levels and shall be assigned an equal weighting of 8.33%, ( B ) if a single event directly causes the failure to achieve more than one Service Level, then only one such credit will apply and ( C ) for the avoidance of doubt, Publishing will not be required to provide any such credits for failing to meet Service Levels prior to the Distribution Date). In each case of a failure to satisfy a Service Level, Publishing shall conduct, within 15 days of such failure, a root cause analysis and provide to Distributing a plan of activities which will allow Publishing to satisfy the applicable Service Level at the earliest date practicable.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Payroll Processing	  	•    Process payroll cycles based on Distributing’s requirements, including normal payroll cycles, special pays, incentives, commissions, etc. on pre-determined pay dates or other dates as requested by Distributing
 
•    Facilitate electronic payments, pay cards or printing of paychecks (including distribution) as required by Distributing
 
•    Calculate gross to net processing
 
•    Prepare funding information and processing of net payroll, taxes, union dues, garnishments, other deductions and the like
 
•    Post pay statements on ePay
 
•    Process third-party payments	  	Through 3/31/2015	  		
					
2.	  	Payroll Maintenance	  	•    Maintain employee payroll related data in PeopleSoft and Workday to allow for continuation of all benefits and payroll processing
 
•    Maintain FEIN and power-of-attorney for the purpose of paying and remitting taxes
 
•    Maintain FUI and SUI tax rates for each Distributing Group FEIN
 
•    Process required registration with state tax agencies	  	Through 3/31/2015	  		
					
3.	  	Payroll Reporting	  	•    At least three days prior to the date on which the on-cycle payment for a period is to be made, provide Distributing with a copy of the payroll register
 
•    On the working day preceding a payroll payment, provide Distributing’s Treasury Service Manager with payroll funding requirements	  	Through 3/31/2015	  		
 
12

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
4.	  	Payroll Tax Compliance	  	•    Maintain ADP tax filing service
 
•    Provide information to ADP as necessary to resolve tax issues
 
•    Provide information to Equifax as necessary for management of unemployment claims
 
•    Annual issuance of W-2’s and if necessary W-2C’s through ADP
 
•    Process other tax reporting not handled by ADP
 
•    Support state audit requests
 
•    Maintain a payroll Help Desk	  	Through 3/31/2015	  		
					
5.	  	Accounts Payable	  	•    Process invoices through OnBase or manually for coding and approval by Distributing employees based on hierarchy established by Distributing
 
•    Facilitate payment processing and distribution
 
•    Send escalation emails for delinquent coding and approval
 
•    Maintain vendor database including W-9 and other relevant information
 
•    Facilitate emergency payments upon request
 
•    Maintain accounts payable Help Desk
 
•    Coordinate year end 1099 reporting with Distributing’s business units including printing and mailing of reports and IRS filing
 
•    Escheatment research and resolution, including filings
 
•    Provide assistance with vendor garnishments, bank exception management, credit applications, utility billing research, void / reissue checks and other similar miscellaneous functions
 
•    Process bankruptcy related claim payments, including maintaining the returned check log, recording claim number details within PeopleSoft, responding to creditor inquiries, voiding outstanding checks, and claim related 1099 reporting	  	Through the earlier of ( x ) the 2 nd anniversary of the Distribution Date and ( y ) Publishing’s implementation of a new enterprise resource planning (“ ERP ”) system, so long as Publishing gives Distributing at least 6 months’ prior written notice thereof	  		
					
6.	  	T&E	  	•    Process applications and issue American Express corporate cards
 
•    Review expense reports for compliance with established policies
 
•    Facilitate payments to American Express and reimbursements to employees for out-of-pocket expenses
 
•    Process and cancel corporate cards and accounts
 
•    Provide delinquency reporting	  	Through the earlier of ( x ) the 2 nd anniversary of the Distribution Date and ( y ) Publishing’s implementation of a new ERP system, so long as Publishing gives Distributing at least 6 months’ prior written notice thereof	  		
 
13

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
7.	  	Accounting	  	•    Record certain monthly journal entries and perform certain account reconciliations including providing supporting documentation to Distributing
 
•    Provide pension payment and reporting services for Distributing’s business units for which current services are provided
 
•    Facilitate capital allocation request (“ CAR ”) set-up, place in service fixed assets, record asset transfers and retirements within PeopleSoft asset management module for Distributing’s business units for which current services are provided
 
•    Provide CAR progress reporting and quarterly fixed asset reporting (i.e., BS-8) preparation for Distributing’s business units for which current services are provided	  	Through the earlier of ( x ) the 2 nd anniversary of the Distribution Date and ( y ) Publishing’s implementation of a new ERP system, so long as Publishing gives Distributing at least 6 months’ prior written notice thereof	  	Notwithstanding Section 3.02 of the Agreement, Distributing will be directly billed under its Blackline contract for new licenses purchased after the Distribution Date	
					
8.	  	Controls and Administration	  	•    Ensure effective internal controls are maintained for service areas performed on behalf of Distributing
 
•    Perform self-testing of controls related to services provided as requested by Distributing and agreed upon by both Parties
 
•    Provide SOC reports for sub-providers upon request
 
•    Review and assess duplicate payments and recoveries
 
•    Complete quarterly OFAC review and reporting
 
•    Controls and administrative costs (including executive costs, facility costs and support services)	  	Through the earlier of ( x ) the 2 nd anniversary of the Distribution Date and ( y ) Publishing’s implementation of a new ERP system, so long as Publishing gives Distributing at least 6 months’ prior written notice thereof	  		
					
	  		  	•    Facilitate internal and external audit requests, including self-testing of controls related to services provided	  		  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, publication related internal and external audit request services required after the 5 month anniversary of the Distribution Date to be charged at $100 per hour for time required to perform such services	
 
14

Transition Service Schedule B
 
V.	Functional Category: Internal Audit	
Distributing’s initial Service Manager shall be Thomas Caputo and Publishing’s initial Service Manager shall be Gregory Page.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Information / Documentation	  	Access to information and documentation related to:
 
•      Transition Services or Migration Services provided to Distributing under the Agreement (including this Schedule B) with respect to the period during which such services were provided under the Agreement, and
 
•      similar services provided to Distributing prior to the Distribution Date	  	Until the 2 nd anniversary of the Distribution Date	  		
					
2.	  	Audit Scoping and Planning	  	Coordination on scoping and planning of test procedures related to then in-effect Transition Services or Migration Services provided to Distributing under the Agreement (including this Schedule B)	  	Until the expiration or termination of all applicable Transition Services and Migration Services	  		
					
3.	  	Audit Results / Reporting	  	Access to monitoring, test results and reports related to:
 
•      Transition Services or Migration Services provided to Distributing under the Agreement (including this Schedule B) with respect to the period during which such services were provided under the Agreement, and
 
•      similar services provided to Distributing prior to the Distribution Date	  	Until the 2 nd anniversary of the Distribution Date	  		
					
4.	  	Legal and Regulatory Compliance	  	Prompt notification of violations of laws, regulations, and policies (including ethics hotline calls and Code of Business Conduct violations) that impact Distributing	  	Until the 2 nd anniversary of the Distribution Date	  		
					
5.	  	Business Continuity / Disaster Recovery	  	Access to business continuity and disaster recovery plans and related test results related to then in-effect Transition Services or Migration Services provided to Distributing under the Agreement (including this Schedule B)	  	Until the expiration or termination of all applicable Transition Services and Migration Services	  		
					
6.	  	Processes / Controls	  	Prompt notification of identified significant process or control issues related to then in-effect Transition Services or Migration Services provided to Distributing under the Agreement (including this Schedule B)	  	Until the expiration or termination of all applicable Transition Services and Migration Services	  		
 
15

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
7.	  	Audit Support	  	Audit support for annual internal control certification process and the preparation of quarterly and annual GAAP financial statements	  	Until the 2 nd anniversary of the Distribution Date	  	To the extent that the audit support relates to a Transition Service subject to special pricing provisions pursuant to the terms of this Schedule B, such audit support shall be subject to such special pricing provisions	
 
16

Transition Service Schedule B
 
VI.	Functional Category: Advertising, Marketing, Event Management and Fleet Maintenance in Hartford Market	
Distributing’s initial Service Manager shall be Chris Geiger and Publishing’s initial Service Manager shall be Nancy Meyer.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
1.	  	Shared Advertising Sales	  	Accept the following advertising sales made by Hartford Courant employees for on-air broadcasting, on websites or on social media platforms managed by WTIC; provided that such advertising sales and the sales made pursuant to co-op advertising sales initiatives described in item VI.2. of this Schedule B, in the aggregate, will not exceed 15% of weekly station availabilities:
 
•      Event advertising sales for any specifically identified event mutually agreed upon by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager (“ VP&GM ”)
 
•      All other advertising sales for a strategic and limited group of advertisers determined by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, such advertising sales will be provided at no charge (i.e., Hartford Courant will pay and incur costs for bonuses and commissions paid to Hartford Courant employees pursuant to these advertising sales and / or will be directly billed by the vendor)	
					
2.	  	Co-op Advertising Sales Initiatives	  	Hartford Courant employees will execute specific co-op advertising sales initiatives for use on-air, on websites or on social media platforms managed by WTIC that are mutually agreed upon by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager; provided that the sales made pursuant to such co-op advertising sales initiatives and the advertising sales described in item VI.1. of this Schedule B, in the aggregate, will not exceed 15% of weekly station availabilities	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, WTIC will pay Hartford Courant $40,000 for such co-op advertising sales initiatives provided through 12/31/2014	
					
3.	  	Hartford Courant Marketing	  	•      Publications, broadcast channels, websites, social media platforms, and signage managed by Hartford Courant will present WTIC marketing campaigns, which will be determined by WTIC’s Vice President & General Manager subject to approval by Hartford Courant’s Publisher
 
•      WTIC will be responsible for the creation and expense of its broadcast campaign materials to be run on Hartford Courant’s platforms	  	Through 12/31/2014	  		
					
4.	  	Marketing Co-Branded / Shared Events	  	Marketing co-branded/shared events will be completed and the specific co-branded/shared events will be determined by Hartford Courant’s Publisher and WTIC’s Vice President & General Manager	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, expenses will be incurred and recorded by Hartford Courant and WTIC, respectively, with no reimbursement	
 
17

Transition Service Schedule B

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
					
5.	  	Event Management	  	Hartford Courant employees and vendors will execute specific co-branded/shared events provided under item VI.4. of this Schedule B as well as off-site broadcast events	  	Through 12/31/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, WTIC will pay Hartford Courant $20,000 for such event management services provided through 12/31/2014 and will reimburse Hartford Courant’s costs for incremental vendor services required for off-site broadcast events	
					
6.	  	Fleet Maintenance and Machine Shop Service	  	•      Service and maintain WTIC’s ENG trucks and news-gathering vehicles
 
•      Provide machine shop services to WTIC’s Broadcast Engineering department for equipment mechanical repair, design and manufacturing services	  	Through 12/31/2014	  		
					
7.	  	FCC Disclosures	  	Appropriate disclosures applying FCC rules will be made for on-air broadcasting joint projects inclusive of signage and background references	  	Through 12/31/2014	  		
 
18

Transition Service Schedule B
 
VII. Functional Category: Procurement
Distributing’s initial Service Manager shall be Kathy Jurgeto and Publishing’s initial Service Manager shall be John Cannizzo.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
1.	  	Travel Management Company	  	Provide enterprise wide travel management company services and corresponding administrative access, as needed	  	Through 11/30/2014	  		
					
2.	  	Dedicated Agent	  	Provide dedicated agent services to senior Distributing managers	  	Through 11/30/2014	  	Notwithstanding Sections 3.01 and 3.02 of the Agreement, Distributing will reimburse Publishing for fees associated with Distributing’s use of dedicated agent services, pro-rata; specific direct costs and monthly pro-rata fees are based on the employees who have access to, and use, the program	
					
3.	  	Preferred Airlines	  	Provide enterprise wide preferred airline services and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
4.	  	Preferred Auto Rental	  	Provide enterprise wide preferred auto rental services and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
5.	  	Preferred Hotels	  	Provide enterprise wide preferred hotels services and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
6.	  	Energy Bill Payment	  	Provide enterprise energy bill payment services and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
7.	  	Energy Consultant	  	Provide specific energy consulting services to de-regulated markets and corresponding administrative access, as needed	  	Through 12/31/2014	  		
					
8.	  	Electrical Energy Supplier	  	Provide electrical energy to de-regulated markets and corresponding administrative access, as needed	  	Through 3/31/2015	  		
 
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Transition Service Schedule B
 
VIII. Functional Category: Digital Ad Operations
Distributing’s initial Service Manager shall be Brian Belanger and Publishing’s initial Service Managers shall be Isabelle Kinel and Jake LaDuke.
Notwithstanding Section 3.02 of the Agreement, Distributing will reimburse Publishing for a portion of Publishing’s full time employee costs based on the percentage of such employees’ work in connection with providing the Transition Services included in this item VIII of this Schedule B to Distributing.

Ref.	  	Transition Service	  	Transition Service Description	  	Term	  	Remarks	
1.	  	Creative Design: Standard Display Advertising Creation	  	Provide Standard Display Advertising Creation on an as-requested basis (standard creative products are defined at tribuneinteractive.com/specs/display.html and include static or flash cubes, half pages, leaderboards, wide skyscrapers, half banners, pencils, micro and mini-banners)	  	Through 12/31/2014	  		
					
2.	  	Creative Design: Rich Media and Admail Creation	  	Provide on an as-requested basis:
 
•   Rich Media Ad Creation (Rich Media creative products and examples are defined at tribuneinteractive.com/specs/richmedia.html and include generating creative tags for billboards, expandables, filmstrips, free-forms, hovers, interstitials, peelbacks, portraits, pushdowns, reskins, sidekicks, sliders, pre-rolls, in-unit video ad units and video interstitials)
 
•   Admail Creation	  	Through 12/31/2014	  		
					
3.	  	Ad Serving	  	•   Rich Media ad serving	  	Through 12/31/2014	  		
					
	  		  	•   Ad Serving Network access for display ad monetization, in Network 8398 of Publishing’s DFP Premium network	  	Through 7/31/2014	  		
 
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Exhibit 10.2
TAX MATTERS AGREEMENT
This Tax Matters Agreement (this “ Agreement ”) is entered into as of [            ], 201[    ], by and between Tribune Company, a Delaware corporation (“ Tribune ”) and Tribune Publishing Company, a newly formed Delaware corporation and a wholly owned subsidiary of Tribune (“ Tribune Publishing ”). Capitalized terms used in this Agreement and not otherwise defined herein shall have the meanings ascribed to such terms in the Separation and Distribution Agreement, dated as of the date hereof, by and between Tribune and Tribune Publishing (the “ Separation and Distribution Agreement ”).
RECITALS
WHEREAS, Tribune is the parent corporation of a group of limited liability companies and nonconsolidated corporate subsidiaries;
WHEREAS, pursuant to the Separation and Distribution Agreement, among other things, Tribune will transfer or cause to be transferred to Tribune Publishing (pursuant to certain preliminary restructuring transactions) all of the Publishing Business Assets, and Tribune Publishing will assume all of the Publishing Assumed Liabilities (the “ Contribution ”);
WHEREAS, on the Distribution Date, Tribune will distribute 98.5% of the issued and outstanding shares of Tribune Publishing Common Stock on a pro rata basis to the holders of Distributing Common Stock and Distributing Warrants;
WHEREAS, the parties to this Agreement intend that ( i ) the Contribution, together with the Distribution, qualify as a tax-free reorganization under Section 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the “ Code ”); ( ii ) the Distribution qualify as a distribution of Tribune Publishing stock to Tribune stockholders eligible for nonrecognition under Sections 355(a) and 361(c) of the Code; ( iii ) the Special Payment qualify as money transferred to creditors or distributed to shareholders in connection with the reorganization within the meaning of Section 361(b)(1) of the Code, to the extent that Tribune distributes the Special Payment to its creditors and/or shareholders in connection with the transactions; and ( iv ) no gain or loss be recognized as a result of such transactions for U.S. federal income tax purposes by any of Tribune, Tribune Publishing, and their respective stockholders and Subsidiaries (except to the extent of cash received in lieu of fractional shares); and

WHEREAS, Tribune and Tribune Publishing desire to set forth their rights and obligations with respect to Taxes due for periods before and after the Distribution Date and other Tax matters relating to the transactions contemplated by the Separation and Distribution Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
“ Agreement ” has the meaning set forth in the preamble.
“ Applicable Federal Rate ” means the rate computed pursuant to Section 1274(d) of the Code, compounded quarterly, with respect to the applicable period.
“ Code ” has the meaning set forth in the recitals.
“ Contribution ” has the meaning set forth in the recitals.
“ Distribution Disqualification ” means that ( i ) the Contribution, taken together with the Distribution, fails to qualify as a tax-free reorganization under Section 368(a)(1)(D) of the Code pursuant to which no gain or loss is recognized for U.S. federal income tax purposes by any of Tribune, Tribune Publishing or their Subsidiaries; ( ii ) the Distribution fails to qualify as a distribution eligible for nonrecognition under Sections 355 and 361 of the Code, pursuant to which no gain or loss is recognized for U.S. federal income tax purposes by any of Tribune, Tribune Publishing, their Subsidiaries, or the stockholders of Tribune, except to the extent of cash received in lieu of fractional shares; and/or ( iii ) the Special Payment fails to qualify as money transferred to creditors or distributed to shareholders in connection with the reorganization within the meaning of Section 361(b)(1) of the Code, but only to the extent that Tribune distributes the Special Payment to its creditors or shareholders. For the avoidance of doubt, a Distribution Disqualification shall occur if Tribune or any of its Subsidiaries recognizes gain pursuant to Section 355(d), 355(e) and/or 355(f) of the Code with respect to the Distribution.
 
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“ Distribution Tax Opinion ” means a written opinion of Tribune Tax Counsel, addressed to Tribune and Tribune Publishing and dated as of the Distribution Date, in form and substance reasonably satisfactory to Tribune, to the effect that ( i ) the Contribution, together with the Distribution, will qualify as a tax-free reorganization under Section 368(a)(1)(D) of the Code; ( ii ) the Distribution will qualify as a distribution of Tribune Publishing stock to Tribune stockholders eligible for nonrecognition under Sections 355(a) and 361(c) of the Code; ( iii ) the Special Payment will qualify as money transferred to creditors or distributed to shareholders in connection with the reorganization within the meaning of Section 361(b)(1) of the Code, to the extent that Tribune distributes the Special Payment to its creditors and/or shareholders in connection with the Transactions; and ( iv ) no gain or loss be recognized as a result of the Transactions for U.S. federal income tax purposes by any of Tribune, Tribune Publishing, and their respective stockholders and Subsidiaries (except to the extent of cash received in lieu of fractional shares).
“ Distribution Tax Representations ” means customary representations and covenants, including those contained in certificates of Tribune, Tribune Publishing and certain stockholders of Tribune, reasonably satisfactory in form and substance to Tribune Tax Counsel, upon which the Distribution Tax Opinion will be based.
“ Final Determination ” means a determination within the meaning of Section 1313 of the Code or any similar provision of state or local tax law.
“ Governmental Authority ” means any foreign, federal, state or local court, administrative agency, official board, bureau, governmental or quasi-governmental entities having competent jurisdiction over Tribune or Tribune Publishing, any of their respective Subsidiaries and any other tribunal or commission or other governmental department, authority or instrumentality or any subdivision, agency, mediator, commission or authority of competent jurisdiction.
“ Income Taxes ” means any and all Taxes based upon or measured by net or gross income (including alternative minimum tax under Section 55 of the Code) and including any liability described in clauses (ii) or (iii) of the definition of “Taxes” that relates to any such Tax.
“ Indemnified Party ” has the meaning set forth in Section 5.01.
“ Indemnifying Party ” has the meaning set forth in Section 5.01.
 
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“ IRS ” means the United States Internal Revenue Service or any successor agency thereto, including its agents, representatives and attorneys.
“ IRS Ruling ” means the private letter ruling from the IRS received by Tribune on March 7, 2014.
“ IRS Submission ” means each of ( i )  a request submitted by Tribune to the IRS for ( A )  the IRS Ruling and ( B )  any other ruling in connection with the Contribution or the Distribution that Tribune deems to be appropriate and ( ii )  any supplemental materials submitted to the IRS relating thereto.
“ Non-Preparer Party ” has the meaning set forth in Section 2.02.
“ Person ” means any individual, partnership, joint venture, corporation, limited liability company, trust, unincorporated organization, government or department or agency of a government.
“ Post-Distribution Period ” means any taxable year or other taxable period beginning after the Distribution Date and, in the case of any taxable year or other taxable period that begins before and ends after the Distribution Date, that part of the taxable year or other taxable period that begins at the beginning of the day after the Distribution Date.
“ Potential Disqualifying Action ” has the meaning set forth in Section 10.02(a).
“ Pre-Distribution Period ” means any taxable year or other taxable period that ends on or before the Distribution Date and, in the case of any taxable year or other taxable period that begins before and ends after the Distribution Date, that part of the taxable year or other taxable period through the close of the Distribution Date.
“ Publishing Holdco ” means Tribune Publishing Company, LLC.
“ Separation and Distribution Agreement ” has the meaning set forth in the preamble.
“ Special Payment ” means the distribution of cash from Tribune Publishing to Tribune in connection with the Contribution, as described in Section 2.1(d) of the Separation and Distribution Agreement.
 
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“ Subsidiary ” means, with respect to any Person (but subject to the proviso in the definition of Affiliate, as such term is defined in the Separation and Distribution Agreement), a corporation, partnership, association, limited liability company, trust or other form of legal entity in which such Person, a Subsidiary of such Person or such Person and one or more Subsidiaries of such Person, directly or indirectly, has either ( i )  a majority ownership in the equity thereof, ( ii )  the power, under ordinary circumstances, to elect, or to direct the election of, a majority of the board of directors or other analogous governing body of such entity, or ( iii )  the title or function of general partner or manager, or the right to designate the Person having such title or function.
“ Tax ” or “ Taxes ” means (i)  all taxes, charges, fees, duties, levies, imposts, required deposits, rates or other assessments or governmental charges of any kind imposed by any federal, state, local or foreign Taxing Authority, including income, gross receipts, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including Taxes under Section 59A of the Code), custom duties, property (including real, personal or intangible), sales, use, license, capital stock, transfer, franchise, registration, payroll, withholding, social security (or similar), unemployment, disability, value added, alternative or add-on minimum or other taxes, whether disputed or not, and including any interest, penalties or additions attributable thereto; ( ii )  liability for the payment of any amount of the type described in clause (i) above arising as a result of being (or having been) a member of any consolidated, combined, unitary or similar group or being (or having been) included or required to be included in any Tax Return related thereto (including pursuant to U.S. Treasury Regulation § 1.1502-6); and ( iii )  liability for the payment of any amount of the type described in clauses (i) or (ii) above as a result of any express or implied obligation to indemnify or otherwise assume or succeed to the liability of any other Person.
“ Tax Attribute ” means any net operating loss carryover or carryback, net capital loss carryover or carryback, investment tax credit carryover or carryback, foreign tax credit carryover or carryback, charitable deduction carryover or carryback or other similar item that could reduce Income Tax for a past or future taxable period.
“ Tax Benefit ” means, ( i ) in the case of a separate state, local or other Tax Return not described in clause (ii), the sum of the amount by which the Tax liability (after giving effect to any alternative minimum or similar Tax) of a corporation to the appropriate Taxing Authority is reduced (including by deduction, entitlement to refund, credit or otherwise, whether available in the current taxable year, as an adjustment to taxable income in any other taxable year or as a carryforward or carryback, as applicable) plus any interest from such government or jurisdiction relating to such Tax liability, and ( ii ) in the case of a consolidated federal Tax Return or combined, unitary or other similar state, local or other Tax Return, the sum of the amount by which the Tax liability of the
 
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affiliated group (within the meaning of Section 1504(a) of the Code) or other relevant group of corporations to the appropriate government or jurisdiction is reduced (including by deduction, entitlement to refund, credit or otherwise, whether available in the current taxable year, as an adjustment to taxable income in any other taxable year or as a carryforward or carryback, as applicable) plus any interest from such government or jurisdiction relating to such Tax liability, determined in the case of clauses (i) or (ii) by comparing the Tax liability on the applicable Tax Return that would arise with and without the item potentially giving rise to the Tax Benefit.
“ Tax Contest ” has the meaning set forth in Section 5.01.
“ Tax Dispute ” has the meaning set forth in ARTICLE IX.
“ Tax Dispute Arbitrator ” has the meaning set forth in ARTICLE IX.
“ Tax-Free Status of the Transactions ” means each of the intended tax consequences specified in the fourth recital hereto.
“ Tax Materials ” has the meaning set forth in Section 10.01(a).
“ Tax Return ” means any return, report, certificate, form or similar statement or document (including any related or supporting information or schedule attached thereto and any information return, amended tax return, claim for refund or declaration of estimated tax) required to be supplied to, or filed with, a Taxing Authority in connection with the determination, assessment or collection of any Tax or the administration of any laws, regulations or administrative requirements relating to any Tax.
“ Taxing Authority ” means any Governmental Authority or any quasi-governmental or private body having jurisdiction over the assessment, determination, collection or imposition of any Tax (including the IRS).
“ Transaction Agreements ” means the Separation and Distribution Agreement and the Ancillary Agreements.
“ Transactions ” has the meaning set forth in Section 2.04(a).
 
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“ Tribune ” has the meaning set forth in the preamble.
“ Tribune Business ” means all of the businesses and operations conducted by the Tribune Group (other than the Publishing Business) at any time, whether prior to, on or after the Distribution Date.
“ Tribune Group ” means Tribune and all Subsidiaries of Tribune at any time preceding, at or following the Contribution, but shall not include any member of the Tribune Publishing Group.
“ Tribune Publishing ” has the meaning set forth in the preamble.
“ Tribune Publishing Common Stock ” means the common stock of Tribune Publishing, par value $0.001 per share.
“ Tribune Publishing Group ” means Tribune Publishing and all entities that are Subsidiaries of Tribune Publishing immediately following the Contribution. For the avoidance of doubt, any direct or indirect predecessor by conversion, liquidation or merger of any such entity shall also be considered to be part of the Tribune Publishing Group during the period of its existence prior to the Contribution.
“ Tribune Publishing Return ” has the meaning set forth in Section 2.01(b).
“ Tribune Return ” has the meaning set forth in Section 2.01(a).
“ Tribune Tax Counsel ” means Debevoise & Plimpton LLP.
 
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ARTICLE II
TAX RETURNS AND TAX PAYMENTS
Section 2.01 Obligations to File Tax Returns .
(a) Tribune shall prepare and file or cause to be filed any Tax Return that is required to be filed (whether before, on or after the Distribution Date) that includes, or otherwise reflects the income and activities of, both ( i ) one or more members of the Tribune Group and ( ii ) one or more members of the Tribune Publishing Group (a “ Tribune Return ”). In the event that under applicable law any Tribune Return must be filed by any member of the Tribune Publishing Group, Tribune Publishing and Tribune shall reasonably cooperate in filing such Tribune Return and, subject to Section 2.04, remitting any Taxes due in connection with such Tribune Return. All Tribune Returns shall be prepared on a basis that is consistent with the Distribution Tax Opinion, the IRS Ruling, and past practice. Each member of the Tribune Publishing Group hereby irrevocably authorizes and designates Tribune as its agent, coordinator and administrator for the purpose of taking any and all actions necessary or incidental to the filing of any such Tribune Return and, except as otherwise provided herein, for the purpose of making payments to, or collecting refunds from, any Taxing Authority in respect of a Tribune Return. Tribune Publishing shall cause members of the Tribune Publishing Group to promptly prepare and deliver to Tribune in a manner consistent with past practices pro forma Tax Returns and tax information packages with respect to any Tribune Return. Except as otherwise provided herein, Tribune shall have the exclusive right to file, prosecute, compromise or settle any claim for refund for Taxes in respect of a Tribune Return for which Tribune bears responsibility hereunder and to determine whether any refunds of such Taxes to which any member of the Tribune Group may be entitled shall be received by way of refund or credit against the Tax liability of such member of the Tribune Group, provided , however, that Tribune Publishing shall be entitled to participate in the pursuit of such Tax refund claim at its own expense if Tribune Publishing would receive such Tax refund under the terms of this Agreement.
(b) Tribune Publishing shall prepare and file or cause to be filed any other Tax Return with respect to one or more members of the Tribune Publishing Group that includes a portion of the Pre-Distribution Period (a “ Tribune Publishing Return ”) that is required to be filed after the Distribution Date. For the avoidance of doubt, the term “Tribune Publishing Return” includes any Tax Return (other than a Tribune Return) for any taxable period that includes a portion of the Pre-Distribution Period and relates to one or more members of the Tribune Publishing Group. In the event that under applicable law any Tribune Publishing Return must be filed by any member of the Tribune Group, Tribune Publishing and Tribune shall reasonably cooperate in filing such Tribune
 
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Publishing Return and, subject to Section 2.04, remitting any Taxes due in connection with such Tribune Publishing Return. All Tribune Publishing Returns shall be prepared on a basis that is consistent with the Distribution Tax Opinion, the IRS Ruling and past practice. Except as otherwise provided herein, Tribune Publishing shall have the exclusive right to file, prosecute, compromise or settle any claim for refund for Taxes in respect of a Tribune Publishing Return for which Tribune Publishing bears responsibility hereunder and to determine whether any refunds of such Taxes to which members of the Tribune Publishing Group may be entitled shall be received by way of refund or credit against the Tax liability of such members, provided , however, that Tribune shall be entitled to participate in the pursuit of such Tax refund claim at its own expense if Tribune would receive such Tax refund under the terms of this Agreement.
Section 2.02 Review of Tax Returns . No later than thirty (30) days prior to the date on which any Tribune Return or Tribune Publishing Return is required to be filed (taking into account any valid extensions), if the party that is not responsible for preparing such Tax Return under Section 2.01 (the “ Non-Preparer Party ”) is responsible for any portion of the Taxes reported on such Tax Return, the party responsible for preparing such Tax Return under Section 2.01 shall ( a ) submit or cause to be submitted to the Non-Preparer Party such Tax Return for review and comment and ( b ) shall consider in good faith any changes to such Tax Return reasonably requested by the Non-Preparer Party, to the extent that such changes relate to items for which the Non-Preparer Party has responsibility hereunder. The provisions of this Section 2.02 shall also apply to the U.S. federal income tax return of Publishing Holdco for its taxable year 2014, regardless of whether the Non-Preparer Party is responsible for any portion of the Taxes reported on such Tax Return.
Section 2.03 Obligation to Remit Taxes . Tribune and Tribune Publishing shall each timely remit or cause to be timely remitted to the applicable Taxing Authority any Taxes due in respect of any Tax Return that such party is required to file or cause to be filed (or, in the case of a Tax for which no Tax Return is required to be filed, which is otherwise payable by such party or a member of such party’s group to any Taxing Authority) and shall be entitled to reimbursement for such payments to the extent provided herein; provided , however, that in the case of any Tax Return, the Non-Preparer Party shall remit to the Party required to file such Tax Return in immediately available funds the amount of any Taxes reflected on such Tax Return for which the Non-Preparer Party is responsible hereunder at least two (2) Business Days before payment of the relevant amount is due to a Taxing Authority.
 
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Section 2.04 Tax Sharing and Indemnification Obligations .
(a) Tribune Publishing shall be liable for and shall indemnify and hold the Tribune Group harmless against any Taxes
( i ) resulting from the Contribution, the Distribution or any transaction associated therewith (the “ Transactions ”), including Taxes arising from any Distribution Disqualification, in each case to the extent that such Taxes arise as a result of ( A ) any action (or failure to take any reasonably required action to avoid a Distribution Disqualification), whether or not otherwise permitted under Section 10.02, by any member of the Tribune Publishing Group at any time or ( B ) an issuance of stock by Tribune Publishing or any of its Affiliates or any change in the ownership (by vote or value, including as a result of any shift in voting power) of any such entities that causes Section 355(d), Section 355(e) and/or Section 355(f) of the Code to apply to the Distribution,
( ii ) resulting from any breach by any member of the Tribune Publishing Group of any representation, covenant or obligation of Tribune Publishing under this Agreement, any other Transaction Agreement or any Tax Material, to the extent that Taxes resulting from such breach are attributable to ( A ) a Distribution Disqualification or ( B ) a breach of Section 6.02(a) hereof, or
( iii ) of the Tribune Publishing Group or any member thereof arising in the Post-Distribution Period or otherwise payable with respect to a Tribune Publishing Return, but not including any Taxes attributable to the income, employees, assets or transactions of the Tribune Business or any Taxes attributable to the Transactions.
Notwithstanding anything herein to the contrary, Tribune Publishing shall not be required to indemnify the Tribune Group under Section 2.04(a)(i)(A) or Section 2.04(a)(ii) for any Taxes that would have been imposed or incurred in the absence of any action, failure to act or breach of any representation, covenant or obligation under any Transaction Agreement or any Tax Material by Tribune Publishing and/or any of their Affiliates. In the event that any Taxes arise with respect to the Transactions (except as a result of Section 355(d), Section 355(e) or Section 355(f) of the Code) as a result of both (and neither one alone) a fact or circumstance described under Section 2.04(a)(i)(A) or Section 2.04(a)(ii) and any action by Tribune or breach by Tribune of any representation, covenant or obligation under any Transaction Agreement or any Tax Material, such Taxes shall be borne equally by Tribune, on the one hand, and Tribune Publishing, on the other hand.
 
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(b) Except for Taxes for which Tribune Publishing is responsible under Section 2.04(a) or any other provision of this Agreement, Tribune shall be liable for and shall indemnify and hold the Tribune Publishing Group harmless against any Taxes ( i ) of the Tribune Group or any member thereof or attributable to the income, employees, assets or transactions of the Tribune Business, ( ii ) of the Tribune Publishing Group or any member thereof arising in any period, or portion thereof, ending on or before the Distribution Date and payable with respect to a Tribune Return or ( iii ) resulting from the Transactions, including Taxes arising from any Distribution Disqualification.
(c) For all purposes of this Agreement, Taxes shall be allocated to the Pre-Distribution Period and the Post-Distribution Period based on an actual or hypothetical closing of the books at the close of the Distribution Date, except that property Taxes and similar Taxes shall be allocated on a daily pro rata basis between such periods.
(d) Except as set forth in this Agreement and in consideration of the mutual indemnities and other obligations of this Agreement, any and all prior Tax sharing or allocation agreements, arrangements or practices between any member of the Tribune Group and any member of the Tribune Publishing Group shall be terminated as of the Distribution Date, and no member of the Tribune Publishing Group shall have any continuing rights or obligations thereunder.
(e) Tribune Publishing shall be entitled to any refund of or credit for Taxes for which Tribune Publishing is responsible under this Agreement, and Tribune shall be entitled to any refund of or credit for Taxes for which Tribune is responsible under this Agreement. A party receiving a refund to which another party is entitled pursuant to this Agreement shall pay the amount to which such other party is entitled within five (5) days after the receipt of the refund. Each party shall be entitled to offset any amount which it is owed under the Transaction Agreements by any amounts owed to it by the other party under this Section 2.04(e) or any other provision of this Agreement.
(f) All indemnification obligations in respect of Taxes pursuant to this Agreement shall be increased to include ( i ) all reasonable accounting, legal and other professional fees and court costs incurred in connection with such Taxes, ( ii ) with respect to Taxes related to the Transactions, all costs, damages or settlement payments associated with any stockholders litigation in respect of adverse Tax consequences of the Transactions, provided , in the case of settlement payments, that any settlement of such litigation for an amount equal to or in excess of $5 million shall not be made without the prior written consent of the Indemnifying Party, which consent shall not be unreasonably withheld, delayed or conditioned, and ( iii ) Taxes resulting from indemnification payments hereunder, and shall be reduced by any Tax Benefit realized by the Indemnified Party in respect of Taxes or other losses subject to indemnification under this Agreement.
 
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(g) The parties agree that any payments made among the parties pursuant to this Agreement or the Separation and Distribution Agreement shall be treated, to the extent permitted by law, for all Tax purposes as contributions to or distributions from Tribune Publishing made immediately prior to the Distribution.
ARTICLE III
CARRYBACKS; AMENDED RETURNS; COMPENSATION DEDUCTIONS
Section 3.01 Carrybacks . Without the consent of Tribune, no member of the Tribune Publishing Group shall carry back any Tax Attribute (unless required to carry back such Tax Attribute by law) from a Post-Distribution Period to a Pre-Distribution Period, provided that if the carryback is required by law, Tribune (or any other member of the Tribune Group receiving any Tax Benefit with respect to such carryback) shall promptly remit to Tribune Publishing any Tax Benefit it realizes with respect to any such carryback. Unless Tribune consents otherwise, each applicable member of the Tribune Publishing Group shall elect to forego the right to carry back any Tax Attributes from a Post-Distribution Period to a Pre-Distribution Period.
Section 3.02 Amended Returns . Tribune Publishing shall not, and shall not permit any member of the Tribune Publishing Group to, file any amended Tribune Publishing Return with respect to which Tribune would have any increased liability for Taxes under Section 2.04(b), or any Tribune Return, without the prior written consent of Tribune, unless such filing is required by applicable law, in which case such consent shall not be unreasonably withheld, conditioned or delayed. Tribune shall not, and shall not permit any member of the Tribune Group to, file any amended Tribune Return with respect to which Tribune Publishing would have any increased liability for Taxes under Section 2.04(a) without the prior written consent of Tribune Publishing, unless such filing is required by applicable law, in which case such consent shall not be unreasonably withheld, conditioned or delayed.
Section 3.03 Tax Benefit Realized . For purposes of this Agreement, a Tax Benefit shall be deemed to have been realized at the time any refund of Taxes is received or applied against other Taxes due, or at the time of filing of a Tax Return (including any relating to estimated Taxes) on which a loss, deduction or credit is applied in reduction of Taxes which would otherwise be payable. If any Tax Benefit is subsequently reduced or
 
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disallowed as a result of an audit, the party that had previously received a payment (or was entitled to reduce a payment that such party was otherwise required to make) on account of such Tax Benefit shall promptly pay an amount equal to the amount so reduced or disallowed to the other party.
Section 3.04 Deductions with Respect to Compensation, Etc .
(a) All deductions for United States federal, state and local Income Tax purposes resulting from the exercise of compensatory options, restricted stock units or similar awards issued prior to the Distribution Date with respect to stock of Tribune shall be taken by Tribune or a member of the Tribune Group, and no party to this Agreement shall take any position on any Tax Return which is inconsistent with such treatment, unless required to do so pursuant to a Final Determination to such effect. For the avoidance of doubt, all deductions for United States federal, state and local Income Tax purposes resulting from the exercise of compensatory options, restricted stock units or similar awards with respect to stock of Tribune Publishing shall be taken by Tribune Publishing or a member of the Tribune Publishing Group.
(b) If, by reason of a subsequent Final Determination as to the treatment of any tax deductions related to the compensatory options referred to in Section 3.04(a) above, a Taxing Authority determines that a member of the Tribune Publishing Group is entitled to such deduction, then Tribune Publishing shall, and shall cause the Tribune Publishing Group to, pay to Tribune the amount of any Tax Benefits that result therefrom within ten (10) days of the date on which such Tax Benefits are realized.
(c) The principles of paragraphs (a) and (b) shall apply, mutatis mutandis , to other items of compensation expense or transaction expense that are economically borne by members of the Tribune Group, including, for the avoidance of doubt, severance bonuses or other similar compensatory payments made by Tribune to employees who are transferred to Tribune Publishing or its Subsidiaries in connection with the Contribution.
ARTICLE IV
PAYMENTS
Section 4.01 Payments . Except as otherwise provided in Section 2.03 or Section 3.04, payments due under this Agreement shall be made no later than thirty (30) days after the receipt or crediting of a refund, the realization of a Tax Benefit for which the other party is entitled to reimbursement, the delivery of notice of payment of a Tax
 
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for which the other party is responsible under this Agreement, or the delivery of notice of a Final Determination which results in such other party becoming obligated to make a payment hereunder to the other party hereto. Payments due hereunder, but not made within such 30-day period, shall be accompanied with interest at a rate equal to the Applicable Federal Rate from the due date of such payment.
Section 4.02 Notice . Tribune and Tribune Publishing shall give each other prompt written notice of any payment that may be due to the provider of such notice under this Agreement.
ARTICLE V
TAX CONTESTS
Section 5.01 Notice . Tribune or Tribune Publishing, as applicable (the “ Indemnified Party ”), shall promptly notify the other party (the “ Indemnifying Party ”) in writing upon receipt by the Indemnified Party or any Affiliate thereof of a written communication from any Taxing Authority with respect to any pending or threatened audit, dispute, suit, action, proposed assessment or other proceeding (a “ Tax Contest ”) concerning any Taxes for which the Indemnifying Party may be liable under this Agreement. The failure of the Indemnified Party to promptly notify the Indemnifying Party shall only relieve the Indemnifying Party from its obligation to indemnify for such Taxes to the extent that the Indemnifying Party is materially prejudiced by such failure (whether as a result of the forfeiture of substantive rights or defenses or otherwise).
Section 5.02 Control of Contests. Tribune shall have sole control of any Tax Contest related to ( a ) any Tribune Return or ( b ) the Tax-Free Status of the Transactions, including the exclusive right to communicate with agents of the Taxing Authority and to control, resolve, settle or agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Tax Contest, provided , however, that in the case of any such Tax Contest that may affect Taxes for which Tribune Publishing has responsibility hereunder, Tribune Publishing may participate fully in the Tax Contest at its own expense. Tribune Publishing shall have sole control of any Tax Contest related to any Tribune Publishing Return, including the exclusive right to communicate with agents of the Taxing Authority and to control, resolve, settle or agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Tax Contest, provided , however, that in the case of any such Tax Contest that may affect Taxes for which Tribune has responsibility hereunder, Tribune may participate fully in the Tax Contest at its own expense. In the case of any such Tax Contest relating to Taxes for which the potential liability of the Indemnifying
 
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Party under this Agreement equals or exceeds $1,000,000, ( A ) the Indemnified Party shall not settle or concede any such Tax Contest without the prior written consent of the Indemnifying Party, which consent shall not be unreasonably withheld, delayed or conditioned and ( B ) absent a settlement of such Tax Contest pursuant to subclause (A) above, the Indemnified Party shall be required to pursue, at the Indemnifying Party’s expense, such Tax Contest through one level of appellate judicial review (it being understood that the Indemnified Party shall have no obligation to pursue such Tax Contest beyond one level of appellate judicial review).
ARTICLE VI
COOPERATION
Section 6.01 General .
(a) Tribune and Tribune Publishing shall cooperate with each other in the filing of any Tax Returns and the conduct of any Tax Contest and each shall execute and deliver such powers of attorney and make available such other documents as are reasonably necessary to carry out the intent of this Agreement. Each party agrees to notify the other party in writing of any audit adjustments which do not result in Tax liability but can be reasonably expected to affect Tax Returns of the other party, or any of its Subsidiaries, for a Post-Distribution Period.
(b) Tribune shall, and shall cause the Tribune Subsidiaries to, make information in the possession of the Tribune Group available to Tribune Publishing for purposes of preparation and compilation by Tribune Publishing and Tribune Publishing’s advisors of those reports and studies necessary for Tribune Publishing in order for it to comply with its Tax reporting and filing obligations in Post-Distribution Periods, including but not limited to studies related to the earnings and profits of Tribune Publishing as of the Distribution Date and the Tax basis in assets and the stock of corporate subsidiaries.
(c) Tribune Publishing shall, and shall cause the Tribune Publishing Subsidiaries to, cooperate in enabling Tribune to comply with the representations made by Tribune in connection with the IRS Ruling, including all cooperation necessary to enable Tribune to vote its retained shares of Tribune Publishing in proportion to the votes cast by other shareholders of Tribune Publishing.
 
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Section 6.02 Consistent Treatment .
(a) Unless and until there has been a Final Determination to the contrary, each party agrees to treat ( i ) the Contribution, together with the Distribution, as a tax–free reorganization qualifying under Section 368(a)(1)(D) of the Code and ( ii ) the Distribution as a transaction qualifying under Sections 355 and 361 of the Code, pursuant to each of which no gain or loss is recognized by any of Tribune, Tribune Publishing and their respective shareholders and Subsidiaries (except to the extent of cash received in lieu of fractional shares).
(b) Unless and until there has been a Final Determination to the contrary, Tribune Publishing shall file or cause to be filed all Tax Returns of a member of the Tribune Publishing Group or relating to the Publishing Business and shall conduct any Tax Contests in respect of a member of the Tribune Publishing Group or the Publishing Business in a manner consistent with Tribune’s determination of the adjusted Tax basis of any asset and the amount of any Tax Attribute or any similar item held by the Tribune Publishing Group at the time of the Distribution.
ARTICLE VII
RETENTION OF RECORDS; ACCESS
The Tribune Group and the Tribune Publishing Group shall ( a ) in accordance with their respective then current record retention policies or for the period required by applicable law, if longer, retain records, documents, accounting data and other information (including computer data) necessary for the preparation and filing of all Tax Returns in respect of Taxes of any member of either the Tribune Group or the Tribune Publishing Group for any Pre-Distribution Period or any Post-Distribution Period or for any Tax Contests relating to such Tax Returns; and ( b ) give to the other party reasonable access to such records, documents, accounting data and other information (including computer data) and to its personnel (insuring their cooperation) and premises, for the purpose of the review or audit of such Tax Returns to the extent relevant to an obligation or liability of a party under this Agreement or for purposes of the preparation or filing of any such Tax Return, the conduct of any Tax Contest or any other matter reasonably and in good faith related to the Tax affairs of the requesting party. If at any time after the Distribution Date, the Tribune Group or the Tribune Publishing Group proposes to destroy such material or information, it shall first use commercially reasonable efforts to notify the other group in writing and such other group shall be entitled to receive at its cost and expense such materials or information proposed to be destroyed.
 
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ARTICLE VIII
SURVIVAL
Notwithstanding any other provision in this Agreement, all representations under this Agreement shall survive until 30 days after the expiration of the statute of limitations period (giving effect to any written waiver, mitigation or extension thereof) applicable to the matters covered thereby and the resolution of all disputes under this Agreement with respect to any such matter that arose during such period. All covenants and agreements contained in this Agreement shall survive indefinitely.
ARTICLE IX
DISPUTE RESOLUTION
Tribune and Tribune Publishing shall attempt in good faith to resolve any disagreement arising with respect to this Agreement, including, but not limited to, any dispute in connection with a claim by a third party (a “ Tax Dispute ”). Either party may give the other party written notice of any Tax Dispute not resolved in the normal course of business. If the parties cannot agree by the tenth Business Day following the date on which one party gives such notice, then the parties shall promptly retain the services of a nationally recognized law or accounting firm reasonably acceptable to the parties (the “ Tax Dispute Arbitrator ”). If the parties cannot agree on the selection of the Tax Dispute Arbitrator, then each party shall designate a nationally recognized law or accounting firm, and such firms shall select the Tax Dispute Arbitrator. The Tax Dispute Arbitrator shall be instructed to resolve the Tax Dispute and such resolution shall be ( a ) set forth in writing and signed by the Tax Dispute Arbitrator, ( b ) delivered to each party involved in the Tax Dispute as soon as practicable after the Tax Dispute is submitted to the Tax Dispute Arbitrator but no later than the 15 th day after the Tax Dispute Arbitrator is instructed to resolve the Tax Dispute, ( c ) made in accordance with this Agreement, and ( d ) final, binding and conclusive on the parties involved in the Tax Dispute on the date of delivery of such resolution. The Tax Dispute Arbitrator shall only be authorized on any one issue to decide in favor of and choose the position of either of the parties involved in the Tax Dispute or to decide upon a compromise position between the ranges presented by the parties to the Tax Dispute Arbitrator. The Tax Dispute Arbitrator shall base its decision solely upon the presentations of the parties to the Tax Dispute Arbitrator at a hearing held before the Tax Dispute Arbitrator and upon any materials made available by either party and not upon independent review. The fees and expenses of the Tax Dispute Arbitrator shall be borne 50% by Tribune and 50% by Tribune Publishing. Tribune and Tribune Publishing shall keep the decision of the Tax Dispute Arbitrator confidential.
 
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ARTICLE X
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 10.01 Representations and Warranties.
Each of Tribune and Tribune Publishing hereby represents and warrants that ( i ) it has examined (or upon receipt will examine) ( A ) the IRS Ruling and any other rulings issued by the IRS in connection with the Distribution, ( B ) the Distribution Tax Opinion, ( C ) each IRS Submission, ( D ) the Distribution Tax Representations and ( E ) any other materials delivered or deliverable by Tribune, Tribune Publishing and their Affiliates in connection with the rendering by Tribune Tax Counsel of the Distribution Tax Opinion and the issuance by the IRS of the IRS Ruling and such other rulings (all of the foregoing, collectively, the “ Tax Materials ”), ( ii ) the facts presented and the representations made therein, to the extent descriptive of or otherwise relating to Tribune, Tribune Publishing and their Affiliates, are or will be true, correct and complete in all material respects from the time presented or made through and including the Distribution Date and ( iii ) except as set forth in a Schedule to this Agreement, or as provided for in a “safe harbor” under Treasury Regulation Section 1.355-7(d), during the two years preceding the date of this Agreement, and until the date of the Distribution, there has been and will be no change in ownership of Distributing Common Stock or Tribune Publishing Common Stock as part of the same plan as the Distribution, all within the meaning of Section 355(e) of the Code. Each of Tribune and Tribune Publishing represents and warrants that the representations and warranties set forth in this Section 10.01 shall be true and correct as of the date of this Agreement and at all times through and including the Distribution Date.
Section 10.02 Covenants Relating to the Distribution .
(a) Tribune Publishing shall not, nor shall it permit any of its Subsidiaries to take any action, including entering into any agreement, understanding or arrangement or any substantial negotiations with respect to any transaction or series of transactions that could ( i ) cause a Distribution Disqualification to occur or ( ii ) jeopardize, directly or indirectly, the conclusions of any ruling received from the IRS, or opinion of counsel received from Tribune Tax Counsel in connection with the Transactions, including any action or failure to act that is inconsistent with any representation made in the Tax Materials (any such action or failure to act, a “ Potential Disqualifying Action ”).
 
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(b) Until the first day after the second anniversary of the Distribution Date, Tribune Publishing shall not enter into any agreement, understanding or arrangement or any substantial negotiations with respect to any transaction (including a merger to which Tribune Publishing is a party) involving the acquisition of stock of Tribune Publishing or a shift of ownership (by vote or value) of Tribune Publishing, and shall not issue any additional shares of capital stock, modify its certificate of incorporation (or other organizational documents) so as to modify the terms or conditions of any class of stock, or transfer or modify any option, warrant, convertible obligation or other instrument that provides for the right or possibility to issue, redeem or transfer any equity interest in Tribune Publishing (or enter into any agreement, understanding, arrangement or any substantial negotiations with respect to any such issuance, transfer or modification). Notwithstanding the foregoing,
( i ) Tribune Publishing may issue additional equity interests in Tribune Publishing to a person in a transaction to which Section 83 or Section 421(a) or (b) of the Code applies in connection with the person’s performance of services as an employee, director or independent contractor of ( A ) Tribune Publishing or its Subsidiaries, ( B ) any other person that is related to Tribune Publishing under Section 355(d)(7)(A) of the Code or ( C ) a corporation the assets of which Tribune Publishing acquires in a reorganization under Section 368 of the Code, provided that such stock is not excessive by reference to the services performed by such person and such person or a coordinating group of which the person is a member will not be a controlling shareholder or a ten-percent shareholder of Tribune Publishing (within the meaning of Treasury Regulations Section 1.355-7(h)(3) and (14)) immediately after the issuance of such common stock; and
( ii ) Tribune Publishing may issue additional shares of common stock of Tribune Publishing to a retirement plan of Tribune Publishing or any other person that is treated as the same employer as Tribune Publishing under Section 414(b), (c), (m), or (o) of the Code that qualifies under Section 401(a) or 403(a) of the Code, provided that the stock acquired by all of the qualified plans of Tribune Publishing and such other persons during the four-year period beginning two years before the Distribution Date does not, in the aggregate, represent more than ten percent of the total combined voting power of all classes of stock of Tribune Publishing entitled to vote or more than ten percent of the total value of shares of all classes of stock of Tribune Publishing.
The intent of the foregoing clauses (i) and (ii) is to permit certain equity issuances by Tribune Publishing, but solely to the extent such issuances would comply with Safe Harbor 8 or 9 set forth in Treasury Regulations Section 1.355-7(d)(8) or (9), and in each case so that such issuances would not cause Tribune or any of its Subsidiaries to
 
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recognize gain pursuant to Section 355(d), 355(e) and/or 355(f) of the Code with respect to the Distribution. To the extent the Treasury Regulations (or the Code) are amended and such amendments could affect the Tax-Free Status of the Transactions, such amendments shall automatically be incorporated by reference into the requirements of the foregoing clauses (i) and (ii) and/or the other relevant parts of this Section 10.02, if applicable.
(c) Until the first day after the second anniversary of the Distribution Date, Tribune Publishing shall not, and shall not permit any of its Subsidiaries to, repurchase any shares of stock of Tribune Publishing except to the extent consistent with the requirements of Section 4.05(1)(b) of Revenue Procedure 96-30, 1996-1 C.B. 696, as the same may be modified or supplemented from time to time, and only to the extent not revoked.
(d) Until the first day after the second anniversary of the Distribution Date, Tribune Publishing shall, and shall cause its wholly owned Subsidiaries that are a part of Tribune Publishing’s “separate affiliated group” (within the meaning of Section 355(b)(3) of the Code) to, continue the active conduct of the Publishing Business (determined in accordance with Section 355(b) of the Code).
(e) Until the first day after the second anniversary of the Distribution Date, Tribune Publishing shall not voluntarily dissolve, liquidate, merge or consolidate with any other person, unless, in the case of a merger or consolidation, Tribune Publishing is the survivor of the merger or consolidation and the transaction otherwise complies with the other provisions of this Section 10.02.
(f) Notwithstanding the foregoing, the provisions of this Section 10.02 shall not prohibit Tribune Publishing from implementing any Potential Disqualifying Action or any other action described in Section 10.02(b), (c), (d) or (e), subject to, and without limiting or modifying, Tribune Publishing’s indemnification obligations under Section 2.04(a), if ( i ) Tribune Publishing obtains the written consent of Tribune (which consent may be given or withheld in Tribune’s sole discretion), ( ii ) Tribune Publishing obtains a supplemental ruling from the IRS or an opinion of a nationally recognized law firm, in form and substance reasonably satisfactory to Tribune, that the taking of such action will not adversely affect, directly or indirectly, the Tax-Free Status of the Transactions or result in a Distribution Disqualification or ( iii ) such action would be permitted under Section 10.02(b)(i) or (ii).
 
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(g) Following the Distribution, Tribune Publishing, Publishing Holdco and their Subsidiaries treated as corporations for U.S. federal income tax purposes shall be treated as a “consolidated group” within the meaning of Treasury Regulations Section 1.1502-1(h) and shall elect to file consolidated returns in accordance with Treasury Regulations Section 1.1502-75 for the taxable year of Tribune Publishing in which the Distribution occurs. Tribune Publishing shall be treated as the common parent of such consolidated group, and such consolidated group shall adopt the taxable year of Tribune Publishing.
ARTICLE XI
MISCELLANEOUS PROVISIONS
To the extent not inconsistent with any specific term of this Agreement, the following sections of the Separation and Distribution Agreement shall apply in relevant part to this Agreement: 13.1 (Amendment and Termination), 13.2 (Effect of Termination), 14.3 (Counterparts), 14.4 (Notices), 14.5 (Public Announcements), 14.6 (Severability), 14.7 (Entire Agreement), 14.10 (Governing Law; Jurisdiction), 14.11 (Waiver of Jury Trial), 14.12 (Headings), 14.13 (Interpretation), 14.14 (Specific Performance), 14.16 (Survival of Covenants) and 14.17 (Waiver). Except as provided in the preceding sentence, and except as specifically provided in the Separation and Distribution Agreement and the Transition Services Agreement, this Agreement shall be the exclusive agreement among the parties with respect to all Tax matters, including indemnification in respect of Tax matters. In the event of any conflict between this Agreement and any other Transaction Agreement, this Agreement shall control.
ARTICLE XII
SUCCESSORS AND ASSIGNS; NO THIRD-PARTY BENEFICIARIES
This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their successors and permitted assigns, but neither this Agreement nor any of the rights, interests and obligations hereunder shall be assigned by any party hereto without the prior written consent of the other parties. This Agreement is solely for the benefit of Tribune, Tribune Publishing and their respective Subsidiaries and Affiliates and is not intended to confer upon any other Persons any rights or remedies hereunder. The obligations of Tribune Publishing under this Agreement shall be binding upon any Person that acquires all or substantially all the assets or stock of Tribune Publishing, whether by merger, amalgamation or consolidation,
 
21

asset purchase, stock purchase or subscription or otherwise, and Tribune Publishing shall not enter into any agreement for any such transaction that does not so expressly provide in writing. The obligations of Tribune under this Agreement shall be binding upon any Person that acquires all or substantially all the assets or stock of Tribune, whether by merger, amalgamation or consolidation, asset purchase, stock purchase or subscription or otherwise, and Tribune shall not enter into any agreement for any such transaction that does not so expressly provide in writing. This Agreement is being entered into by Tribune and Tribune Publishing on behalf of themselves and their Subsidiaries. This Agreement shall constitute a direct obligation of each member of the Tribune Group and each member of the Tribune Publishing Group and shall be deemed to have been readopted and affirmed on behalf of any entity that becomes a Subsidiary of Tribune or Tribune Publishing in the future.
ARTICLE XIII
EFFECTIVENESS
All covenants and agreements of the parties contained in this Agreement shall be effective immediately.
 
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.

TRIBUNE COMPANY	
		
By:	 	 	
	 	[                    ]	
	
TRIBUNE PUBLISHING COMPANY	
		
By:	 	 	
	 	[                    ]	
 
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Exhibit 10.4
REGISTRATION RIGHTS AGREEMENT
dated as of
[ — ], 2014
among
TRIBUNE PUBLISHING COMPANY,
and
CERTAIN OTHER PARTIES LISTED HEREIN

TABLE OF CONTENTS

 	  	 	  	P AGE	 	
	
ARTICLE 1
D EFINITIONS	  

Section 1.01.	  	Definitions	  	 	1	  	
Section 1.02.	  	Other Definitional and Interpretative Provisions	  	 	6	  	
	
ARTICLE 2
R EGISTRATION R IGHTS	  

Section 2.01.	  	Demand Registration	  	 	7	  	
Section 2.02.	  	Shelf Registration	  	 	10	  	
Section 2.03.	  	Piggyback Registration	  	 	14	  	
Section 2.04.	  	Lock-Up Agreements	  	 	15	  	
Section 2.05.	  	Registration Procedures	  	 	16	  	
Section 2.06.	  	Indemnification by the Company	  	 	22	  	
Section 2.07.	  	Indemnification by Registering Stockholders	  	 	22	  	
Section 2.08.	  	Conduct of Indemnification Proceedings	  	 	23	  	
Section 2.09.	  	Contribution	  	 	24	  	
Section 2.10.	  	Participation in Public Offering	  	 	24	  	
Section 2.11.	  	Other Indemnification	  	 	25	  	
Section 2.12.	  	Cooperation by the Company	  	 	25	  	
Section 2.13.	  	Transfer of Registration Rights	  	 	25	  	
Section 2.14.	  	Limitations on Subsequent Registration Rights	  	 	25	  	
Section 2.15.	  	Free Writing Prospectuses	  	 	26	  	
Section 2.16.	  	Information from Registering Stockholders; Obligations of Registering Stockholders	  	 	26	  	
	
ARTICLE 3
T ERMINATION	  

Section 3.01.	  	Termination	  	 	27	  	
	
ARTICLE 4
MISCELLANEOUS	  

Section 4.01.	  	Successors and Assigns	  	 	27	  	
Section 4.02.	  	Notices	  	 	28	  	
Section 4.03.	  	Amendments and Waivers	  	 	30	  	
Section 4.04.	  	Governing Law	  	 	30	  	
Section 4.05.	  	Jurisdiction	  	 	30	  	
 
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Section 4.06.	  	WAIVER OF JURY TRIAL	  	 	30	  	
Section 4.07.	  	Specific Enforcement	  	 	31	  	
Section 4.08.	  	Counterparts; Effectiveness; Third Party Beneficiaries	  	 	31	  	
Section 4.09.	  	Entire Agreement	  	 	31	  	
Section 4.10.	  	Severability	  	 	31	  	
Section 4.11.	  	Sophisticated Parties; Advice of Counsel	  	 	31	  	
Section 4.12.	  	Certificate of Incorporation Supersedes	  	 	32	  	
			
Exhibit A	  	Joinder Agreement	  				
Schedule 1	  	JPMorgan Parties	  				
Schedule 2	  	Angelo Gordon Funds	  				
Schedule 3	  	Oaktree Funds	  				
 
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT dated as of [ — ], 2014 (this “ Agreement ”) among (i) Tribune Publishing Company, a Delaware corporation (the “ Company ”), (ii) the parties listed on Schedule 1, (iii) the parties listed on Schedule 2 and (iv) the parties listed on Schedule 3 and (v) other stockholders party hereto from time to time.
W I T N E S S E T H:
WHEREAS, Tribune Company and each Stockholder Group (as defined below) are parties to a registration rights agreement, dated December 31, 2012, providing specified registration rights to each Stockholder Group with respect to securities of Tribune Company;
WHEREAS, such registration rights agreement gives each Stockholder Group specified registration rights with respect to, among others, any securities received as a dividend or a distribution in respect of common stock of Tribune Company;
WHEREAS, Tribune Company is effecting the Spin-off (as defined below), pursuant to which it will distribute to its shareholders, including each Stockholder Group, shares of Common Stock (as defined below);
WHEREAS, the parties hereto are entering into this Agreement to provide certain registration rights under the Securities Act (as defined below) and applicable state securities laws to each Stockholder Group with respect to Registrable Securities (as defined below) each may hold; and
NOW, THEREFORE, in consideration of the covenants and agreements contained herein, the parties hereto agree as follows:
ARTICLE 1
D EFINITIONS
Section 1.01. Definitions. (a) As used herein, the following terms have the following meanings:
“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person; provided that no securityholder of the Company shall be deemed an Affiliate of any other securityholder solely by reason of any investment in the Company. For the purpose of this definition, the term “ control ” (including, with correlative meanings, the terms “ controlling ”, “ controlled by ” and “ under common control with ”), as used with
 
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respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.
“ Angelo Gordon Stockholder ” means, collectively, (i) each Stockholder listed on Schedule 2 under the heading “Angelo Gordon Funds,” (ii) their respective Affiliates and (iii) any transferee to whom any registration right hereunder held by the Persons in the foregoing clauses (i) and (ii) are assigned pursuant to Section 2.13 .
“ Automatic Shelf Registration Statement ” means an “automatic shelf registration statement” as defined in Rule 405 promulgated under the Securities Act.
“ Board ” means the board of directors of the Company or any committee thereof.
“ Business Day ” means any day except a Saturday, Sunday or other day on which commercial banks in New York City are authorized by law to close.
“ Certificate of Incorporation ” means the Amended and Restated Certificate of Incorporation of the Company, as the same may be amended, modified or restated from time to time.
“ Common Stock ” means (i) the Common Stock, par value $0.01 per share, of the Company, (ii) any other common stock of the Company, (iii) any securities of the Company or any successor or assign of the Company into which such stock described in clauses (i) and (ii) is reclassified or reconstituted or into which such stock is converted or otherwise exchanged in connection with a combination of shares, recapitalization, merger, sale of assets, consolidation or other reorganization or otherwise or (iv) any securities received as a dividend or a distribution in respect of the securities described in clauses (i), (ii) and (iii) above.
“ Company Securities ” means (i) the Common Stock, (ii) securities convertible into or exchangeable for Common Stock and (iii) any options, warrants or other rights to acquire Common Stock.
“Effective Date” means the date the Spin-off is completed.
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder.
“ FINRA ” means the Financial Industry Regulatory Authority, Inc.
“ Free Writing Prospectus ” means any “free writing prospectus” as defined in Rule 405 promulgated under the Securities Act relating to the Registrable Securities included in the applicable Registration Statement.
 
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“ JPMorgan Stockholder ” means collectively, (i) each Stockholder listed on Schedule 1 under the heading “JPMorgan Parties,” (ii) their respective Affiliates and (iii) any transferee to whom any registration right hereunder held by the Persons in the foregoing clauses (i) and (ii) are assigned pursuant to Section 2.13 .
“ Oaktree Stockholder ” means, collectively, (i) each Stockholder listed on Schedule 3 under the heading “Oaktree Funds,” (ii) their respective Affiliates and (iii) any transferee to whom any registration right hereunder held by the Persons in the foregoing clauses (i) and (ii) are assigned pursuant to Section 2.13 .
“ Person ” means an individual, corporation, partnership, limited liability company, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof, and shall include any successor (by merger or otherwise) thereto.
“ Public Offering ” means an underwritten public offering of Registrable Securities (or in the case of the Company, Company Securities) pursuant to an effective registration statement under the Securities Act, other than pursuant to a registration statement on Form S-4 or Form S-8 or any similar or successor form under the Securities Act.
“ Registrable Securities ” means, at any time, any Company Securities until (i) a registration statement covering such securities has been declared effective by the SEC and such securities have been disposed of pursuant to such effective registration statement, (ii) such securities are sold pursuant to Rule 144 (or any similar provisions then in force) or (iii) such securities are otherwise transferred, assigned, sold, conveyed or otherwise disposed of and thereafter such securities may be resold without subsequent registration under the Securities Act.
“ Registration Expenses ” means any and all expenses incident to the performance of or compliance with any registration or marketing of Registrable Securities, regardless of whether such Registration Statement is declared effective, including all (i) registration and filing fees, and all other fees and expenses payable in connection with the listing of securities on any securities exchange or automated interdealer quotation system, (ii) fees and expenses incurred in complying with any securities or “blue sky” laws (including reasonable fees and disbursements of counsel in connection with “blue sky” qualifications of the Registrable Securities as may be set forth in any underwriting agreement), (iii) expenses in connection with the preparation, printing, mailing and delivery of any registration statements, prospectuses and other documents in connection therewith and any amendments or supplements thereto, (iv) security engraving and printing expenses, (v) internal expenses of the Company (including all salaries and expenses of its officers and employees performing legal or accounting duties), (vi) reasonable fees and disbursements of counsel for the Company and customary fees and expenses for independent certified public accountants retained by the Company
 
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(including the expenses relating to any comfort letters or costs associated with the delivery by independent certified public accountants of any “comfort” letters requested pursuant to Section 2.05(h) or any special audits incidental to or required by any registration or qualification), (vii) reasonable fees and expenses of any special experts retained by the Company in connection with such registration, (viii) reasonable fees, out-of-pocket costs and expenses of one firm of counsel selected by the holder(s) of a majority of the Registrable Securities covered by each Registration Statement (the “ Holders’ Counsel ”) up to a maximum amount of $50,000 per Registration Statement, (ix) fees and expenses in connection with any review by FINRA of the underwriting arrangements or other terms of the offering, and all fees and expenses of any qualified independent underwriter, including the reasonable fees and expenses of any counsel thereto, (x) fees and disbursements of underwriters customarily paid by issuers or sellers of securities, but excluding any underwriting fees, discounts and commissions attributable to the sale of Registrable Securities, (xi) costs of printing and producing any agreements among underwriters, underwriting agreements, any “blue sky” or legal investment memoranda and any selling agreements and other documents in connection with the offering, sale or delivery of the Registrable Securities, (xii) transfer agents’ and registrars’ fees and expenses and the fees and expenses of any other agent or trustee appointed in connection with such offering, (xiii) expenses relating to any analyst or investor presentations or any “road shows” undertaken in connection with the registration, marketing or selling of the Registrable Securities, (xiv) fees and expenses payable in connection with any ratings of the Registrable Securities, including expenses relating to any presentations to rating agencies, (xv) all out-of pocket costs and expenses incurred by the Company or its appropriate officers in connection with their compliance with Section 2.05(m) and (xvi) any liability insurance or other premiums for insurance obtained in connection with any Demand Registration, Piggyback Registration or Shelf Registration pursuant to the terms of this Agreement.
“ Registration Statement ” means any registration statement of the Company under the Securities Act that covers any of the Registrable Securities pursuant to the provisions of this Agreement, including an Automatic Shelf Registration Statement.
“ Requesting Stockholder ” means, with respect to a Demand Registration or Shelf Registration, as applicable, any Stockholder Group holding at least 5% of the Common Stock.
“ Rule 144 ” means Rule 144 (or any successor provisions) under the Securities Act.
“ Seasoned Issuer ” means an issuer eligible to use Form S-3 or F-3 under the Securities Act for a primary offering in reliance on General Instruction I.B.1 to those Forms and who is not an “ineligible issuer” as defined in Rule 405 promulgated under the Securities Act.
 
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“ SEC ” means the Securities and Exchange Commission or any successor governmental agency.
“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.
“ Shares ” means shares of Common Stock.
“ Shelf Registered Securities ” means any Registrable Securities whose offer and sale is registered pursuant to a Registration Statement filed in connection with a Shelf Registration (including an Automatic Shelf Registration Statement).
“ Specified Period ” means, with regard to the period after the effective date of a Registration Statement, ninety (90) days; provided that if (i) the Company issues an earnings release or other material news or a material event relating to the Company and its Subsidiaries occurs during the last seventeen (17) days of such period or (ii) prior to the expiration of such period, the Company announces that it will release earnings results during the 16-day period beginning upon the expiration of such period, then to the extent necessary for a managing or co-managing underwriter of a registered offering required hereunder to comply with NASD Rule 2711(f)(4), if applicable to the Company, such period shall be extended until eighteen (18) days after the earnings release or the occurrence of the material news or event, as the case may be.
“Spin-off” means the distribution by Tribune Company, a Delaware corporation, and registration of the Common Stock pursuant to the Company’s Form 10 filed with and declared effective by the SEC.
“ Stockholder ” means at any time, any Person (other than the Company) who shall be a party to or bound by this Agreement, so long as such Person shall be the “beneficial owner” (as such term is defined in Rule 13d-3 of the Exchange Act) any Company Securities.
“ Stockholder Group ” means any of the JPMorgan Stockholder, the Angelo Gordon Stockholder and the Oaktree Stockholder.
“ Subsidiary ” means, with respect to any Person, any entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions at the time are directly or indirectly owned by such Person.
“ Well-Known Seasoned Issuer ” means a “well-known seasoned issuer” as defined in Rule 405 promulgated under the Securities Act and which (i) (a) is a “well-known seasoned issuer” under paragraph (1)(i)(A) of such definition or (b) is a “well-known seasoned issuer” under paragraph (1)(i)(B) of such definition and is also eligible
 
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to register a primary offering of its securities relying on General Instruction I.B.1 of Form S-3 or Form F-3 under the Securities Act and (ii) is not an “ineligible issuer” as defined in Rule 405 promulgated under the Securities Act.
(b) Each of the following terms is defined in the Section set forth opposite such term:

Term	  	Section	
Agreement	  	Preamble	
Alternative Transaction	  	2.02(d)	
Company	  	Preamble	
Damages	  	2.06	
Demand Registration	  	2.01(a)	
Determination Date	  	2.02(f)	
Form S-3	  	2.01(a)	
Indemnified Party	  	2.08	
Indemnifying Party	  	2.08	
Inspectors	  	2.05(g)	
Maximum Offering Size	  	2.01(e)	
Piggyback Registration	  	2.03(a)	
Records	  	2.05(g)	
Registering Stockholders	  	2.01(a)(ii)	
Registration Actions	  	2.01(f)	
Requested Shelf Registered Securities	  	2.02(b)	
Shelf Public Offering	  	2.02(b)	
Shelf Public Offering Notice	  	2.02(b)	
Shelf Public Offering Request	  	2.02(b)	
Shelf Public Offering Requesting Stockholder	  	2.02(b)	
Shelf Registration	  	2.02(a)	
Stockholder Parties	  	2.06	
Suspension Notice	  	2.01(f)	
Suspension Period	  	2.01(f)	
Section 1.02. Other Definitional and Interpretative Provisions. The words “hereof”, “herein” and “hereunder” and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof. References to Articles, Sections, Exhibits and Schedules are to Articles, Sections, Exhibits and Schedules of this Agreement unless otherwise specified. All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Exhibit or Schedule but not otherwise defined therein,
 
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shall have the meaning as defined in this Agreement. Any singular term in this Agreement shall be deemed to include the plural, and any plural term the singular. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”, whether or not they are in fact followed by those words or words of like import. “Writing”, “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form. References to any Person include the successors and permitted assigns of that Person. References from or through any date mean, unless otherwise specified, from and including or through and including, respectively.
ARTICLE 2
R EGISTRATION R IGHTS
Section 2.01. Demand Registration . (a) At any time following the six-month anniversary of the Effective Date, any Requesting Stockholder may give a written request to the Company to effect the registration under the Securities Act (other than pursuant to a registration statement on Form S-4 or Form S-8 or any similar or successor form under the Securities Act) of all or any portion of such Requesting Stockholder’s Registrable Securities, which written request shall specify the number of Registrable Securities to be registered and the intended method of disposition thereof. At any time the Company is eligible for use of an Automatic Shelf Registration Statement, such registration shall occur on such form. Upon the receipt of such written request, the Company shall promptly give notice (via facsimile or electronic transmission) to the other Stockholder Groups of such requested registration (each such registration shall be referred to herein as a “ Demand Registration ”) at least ten (10) Business Days prior to the anticipated filing date of the Registration Statement relating to such Demand Registration. Thereafter, the Company shall use its commercially reasonable efforts to effect, as soon as possible, the registration under the Securities Act of:
(i) all Registrable Securities for which the Requesting Stockholder has requested registration under this Section 2.01 ;
(ii) all other Registrable Securities of the same class or series as those requested to be registered by the Requesting Stockholder that any other Stockholder Group (all such Stockholder Groups, together with the Requesting Stockholder, and any Stockholder Groups participating in a Piggyback Registration pursuant to Section 2.03 , the “ Registering Stockholders ”) have requested the Company to register by request received by the Company within ten (10) Business Days after such Stockholder Groups receive the Company’s notice of the Demand Registration; and
(iii) any Company Securities to be offered or sold by the Company;
 
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all to the extent necessary to permit the disposition (in accordance with the intended methods thereof as aforesaid) of the Registrable Securities so to be registered; provided that, subject to Section 2.01(d) , the Company shall not be obligated to effect (x) more than five (5) Demand Registrations requested by the Oaktree Stockholder, three (3) Demand Registrations requested by the JPMorgan Stockholder and three (3) Demand Registrations requested by the Angelo Gordon Stockholder, in each case, other than Demand Registrations to be effected pursuant to a Registration Statement on Form S-3 (or any successor or similar form) under the Securities Act (“ Form S-3 ”) for which an unlimited number of Demand Registrations shall be permitted, (y) any such Demand Registration (i) within the Specified Period (or such shorter period as the Company may determine in its sole discretion) after the effective date of any other registration statement of the Company (other than a registration statement filed in connection with an employee benefit plan or business combination transaction or a registration statement on Form S-4 or Form S-8 or any similar or successor form thereto) or (ii) in accordance with Section 2.01(f) or (z) any Demand Registration if the aggregate proceeds expected to be received from the sale of the Registrable Securities requested to be included in such Demand Registration is less than $20,000,000.
(b) Promptly after the expiration of the ten (10) Business Day period referred to in Section 2.01(a)(ii) , the Company will notify all Registering Stockholders of the identities of the other Registering Stockholders and the number of shares of Registrable Securities requested to be included in the Demand Registration by each of them. At any time prior to the effective date of the Registration Statement relating to such Demand Registration, the Requesting Stockholder may upon notice to the Company, revoke such request in whole or in part with respect to the number of shares of Registrable Securities requested to be included in such Registration Statement, without liability to any of the other Registering Stockholders.
(c) The Company shall be liable for and pay all Registration Expenses in connection with any Demand Registration, regardless of whether such Demand Registration becomes effective; provided, however, that if the Requesting Stockholder revokes its request in whole pursuant to Section 2.01(b) , the Requesting Stockholder shall reimburse the Company for and/or pay directly all Registration Expenses incurred relating to such Demand Registration.
(d) A Demand Registration shall not be deemed to have occurred:
(i) unless the Registration Statement relating thereto (A) has become effective under the Securities Act and (B) has remained continuously effective for a period of at least (x) one hundred eighty (180) days (or such shorter period in which all Registrable Securities of the Registering Stockholders included in such registration have actually been sold thereunder) or (y) with respect to a Shelf Registration, until the date set forth in Section 2.05(a)(ii) ; provided that such Registration Statement shall not be considered a Demand Registration if, after
 
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such Registration Statement becomes effective, (1) such Registration Statement is interfered with by any stop order, injunction or other order or requirement of the SEC or other governmental agency or court and (2) less than 75% of the Registrable Securities included in such Registration Statement have been sold thereunder; or
(ii) if the Maximum Offering Size is reduced in accordance with Section 2.01(e) such that less than 66  2 ⁄ 3 % of the Registrable Securities of the Requesting Stockholder sought to be included in such registration are included.
(e) If a Demand Registration involves a Public Offering and the lead managing underwriter advises the Company and the Requesting Stockholder that, in its view, the number of shares of Registrable Securities requested to be included in such registration (including any securities that the Company proposes to be included that are not Registrable Securities) exceeds the largest number of shares that can be sold without having a material and adverse effect on such offering, including the price at which such shares can be sold (the “ Maximum Offering Size ”), the Company shall include in such registration, in the priority listed below, up to the Maximum Offering Size:
(i) first, all Registrable Securities requested to be registered by the Requesting Stockholder and all other Registering Stockholders (allocated, if necessary for the offering not to exceed the Maximum Offering Size, to give first priority to the inclusion of the Registrable Securities of the Requesting Stockholder and, thereafter, pro rata among the remaining Registering Stockholders on the basis of the relative number of shares of Registrable Securities so requested to be included in such registration by each such Registering Stockholder);
(ii) second, any securities proposed to be registered by the Company; and
(iii) third, any securities proposed to be registered for the account of any other Persons, with such priorities among them as the Company shall determine.
(f) Notwithstanding anything to the contrary contained in this Agreement, but subject to the limitation set forth in the next succeeding paragraph, the Company shall be entitled to suspend its obligation to file (but not the preparation of) any Registration Statement in connection with a Demand Registration, any Shelf Registration (including any Shelf Public Offering), file any amendment to such a Registration Statement, file or furnish any supplement or amendment to a prospectus included in such a Registration Statement, make any other filing with the SEC, cause such a Registration Statement or other filing with the SEC to become or remain effective or take any similar action (collectively, “ Registration Actions ”) upon (i) the issuance by the SEC of a stop order
 
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suspending the effectiveness of any such Registration Statement or the initiation of proceedings with respect to such a Registration Statement under Section 8(d) or 8(e) of the Securities Act, (ii) the Board’s determination, in its good faith judgment, that any such Registration Action should not be taken because it would reasonably be expected to materially interfere with or require the public disclosure of any material corporate development or plan, including any material financing, securities offering, acquisition, disposition, corporate reorganization or merger or other transaction involving the Company or any of its subsidiaries or (iii) the Company possessing material non-public information the disclosure of which the Board determines, in its good faith judgment, would reasonably be expected to not be in the best interests of the Company. Upon the occurrence of any of the conditions described in (i), (ii) or (iii) above in connection with undertaking a Registration Action, the Company shall give prompt notice of such suspension (and whether such action is being taken pursuant to (i), (ii) or (iii) above) (a “ Suspension Notice ”) to the Stockholders. Upon the termination of such condition, the Company shall give prompt notice thereof to the Stockholders and shall promptly proceed with all Registration Actions that were suspended pursuant to this paragraph.
The Company may only suspend Registration Actions pursuant to the preceding paragraph on one (1) occasion during any period of six (6) consecutive months for a reasonable time specified in the Suspension Notice but not exceeding ninety (90) days (which period may not be extended or renewed) (each such occasion, a “ Suspension Period ”). Each Suspension Period shall be deemed to begin on the date the relevant Suspension Notice is given to the Stockholders and shall be deemed to end on the earlier to occur of (i) the date on which the Company gives the Stockholders a notice that the Suspension Period has terminated and (ii) the date on which the number of days during which a Suspension Period has been in effect exceeds the ninety (90) day period. If the filing of any Demand Registration or Shelf Registration is suspended pursuant to this Section 2.01(f) , once the Suspension Period ends the Requesting Stockholder may request a new Demand Registration or a new Shelf Registration (neither such request shall be counted as an additional Demand Registration for purposes of subclause (x)  in the proviso of Section 2.01(a)) . Notwithstanding anything to the contrary in this Agreement, the Company shall not be in breach of, or have failed to comply with, any obligation under this Agreement where the Company acts or omits to take any action in order to comply with applicable law, any interpretation of the staff of the SEC or any order or decree of any court or governmental agency.
Section 2.02. Shelf Registration .
(a) At any time when (i) the Company is eligible to use Form S-3 in connection with a secondary public offering of its equity securities and (ii) a Shelf Registration on a Form S-3 registering Registrable Securities for resale is not then effective (subject to any applicable Suspension Period), upon the written request of any Stockholder Group, the Company shall use its commercially reasonable efforts to
 
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register, under the Securities Act on Form S-3 for an offering on a delayed or continuous basis pursuant to Rule 415 promulgated under the Securities Act (a “ Shelf Registration ”), the offer and sale of all or a portion of the Registrable Securities owned by such Stockholder Group. Upon the receipt of such written request, the Company shall promptly give notice (via facsimile or electronic transmission) of such requested Shelf Registration at least ten (10) Business Days prior to the anticipated filing date of such Shelf Registration to the other Stockholder Groups, and such notice shall describe the proposed Shelf Registration, the intended method of disposition of such Registrable Securities and any other information that at the time would be appropriate to include in such notice, and offer such Stockholder Groups the opportunity to register the number of Registrable Securities as each such Stockholder Group may request in writing to the Company, given within ten (10) Business Days after such Stockholder Groups receive the Company’s notice of the Shelf Registration. The “Plan of Distribution” section of such Shelf Registration shall permit all lawful means of disposition of Registrable Securities, including firm-commitment underwritten public offerings, block trades, agented transactions, sales directly into the market, purchases or sales by brokers and sales not involving a public offering. With respect to each Shelf Registration, the Company shall, subject to any Suspension Period, (i) as promptly as practicable after the written request of the Requesting Stockholder, file a Registration Statement and (ii) use its commercially reasonable efforts to cause such Registration Statement to be declared effective as promptly as practicable, and remain effective until the date set forth in Section 2.05(a)(ii) . No Stockholder shall be entitled to include any of its Registrable Securities in a Shelf Registration unless such Stockholder has complied with Section 2.16 . The Company shall not be required to amend a Shelf Registration (or the related prospectus) to add or change the disclosure regarding selling securityholders during any Suspension Period. The obligations set forth in this Section 2.02(a) shall not apply if the Company has a currently effective Automatic Shelf Registration Statement covering all Registrable Securities in accordance with Section 2.02(f) and has otherwise complied with its obligations pursuant to this Agreement.
(b) Upon written request by a Requesting Stockholder holding Shelf Registered Securities (such Stockholder, the “ Shelf Public Offering Requesting Stockholder ”), which request (the “ Shelf Public Offering Request ”) shall specify the class or series and amount of such Shelf Public Offering Requesting Stockholder’s Shelf Registered Securities to be sold (the “ Requested Shelf Registered Securities ”), the Company shall (subject to any Suspension Period) perform its obligations hereunder with respect to the sale of such Requested Shelf Registered Securities in the form of a firm commitment underwritten public offering (unless otherwise consented to by the Shelf Public Offering Requesting Stockholder) (a “ Shelf Public Offering ”) if the aggregate proceeds expected to be received from the sale of the Requested Shelf Registered Securities equals or exceeds $20,000,000. Promptly upon receipt of a Shelf Public Offering Request, the Company shall provide notice (the “ Shelf Public Offering Notice ”) of such proposed Shelf Public Offering (which notice shall state the material
 
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terms of such proposed Shelf Public Offering, to the extent known, as well as the identity of the Shelf Public Offering Requesting Stockholder) to the other Stockholder Groups holding Shelf Registered Securities. Such other Stockholder Groups may, by written request to the Company and the Shelf Public Offering Requesting Stockholder, within two (2) Business Days after receipt of such Shelf Public Offering Notice, include up to all of their Shelf Registered Securities of the same class or series as the Requested Shelf Registered Securities in such proposed Shelf Public Offering; provided , that any such Shelf Registered Securities shall be sold subject to the same terms as are applicable to the Shelf Registered Securities of the Shelf Public Offering Requesting Stockholder. No Stockholder shall be entitled to include any of its Registrable Securities in a Shelf Public Offering unless such Stockholder has complied with Section 2.16 . The lead managing underwriter or underwriters selected for such Shelf Public Offering shall be selected in accordance with Section 2.05(f)(i) .
(c) In a Shelf Public Offering, if the lead managing underwriter advises the Company and the Shelf Public Offering Requesting Stockholder that, in its view, the number of shares of Registrable Securities requested to be included in such Shelf Public Offering (including any securities that the Company proposes to be included that are not Registrable Securities) exceeds the Maximum Offering Size, the Company shall include in such Shelf Public Offering, in the priority listed below, up to the Maximum Offering Size:
(i) first, all Shelf Registered Securities requested to be included in the Shelf Public Offering by the Shelf Public Offering Requesting Stockholder and all other Stockholders, pro rata on the basis of the relative number of shares of Shelf Registered Securities so requested to be included in the Shelf Public Offering by each such Stockholder;
(ii) second, any securities proposed to be included in the Shelf Public Offering by the Company; and
(iii) third, any securities proposed to be included in the Shelf Public Offering for the account of any other Persons, with such priorities among them as the Company shall determine.
(d) The Company shall use its commercially reasonable efforts to cooperate in a timely manner with any request of the Stockholders in respect of any block trade, hedging transaction or other transaction that is registered pursuant to a Shelf Registration that is not a firm commitment underwritten offering (each, an “ Alternative Transaction ”), including entering into customary agreements with respect to such Alternative Transactions (and providing customary representations, warranties, covenants and indemnities in such agreements) as well as providing other reasonable assistance in respect of such Alternative Transactions of the type applicable to a Public Offering subject to Section 2.05 , to the extent customary for such transactions. The Company
 
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shall bear all Registration Expenses in connection with any Shelf Registration, any Shelf Public Offering or any other transaction (including any Alternative Transaction) registered under a Shelf Registration pursuant to this Section 2.02 , whether or not such Shelf Registration becomes effective or such Shelf Public Offering or other transactions is completed; provided , however , that if the Shelf Public Offering Requesting Stockholder revokes its request in whole with respect to a Shelf Public Offering, then the Shelf Public Offering Requesting Stockholder shall reimburse the Company for and/or pay directly all Registration Expenses incurred relating to such Shelf Public Offering.
(e) After the Registration Statement with respect to a Shelf Registration is declared effective but subject to the Suspension Period, upon written request by one or more Stockholders (which written request shall specify the amount of such Stockholders’ Registrable Securities to be registered), the Company shall, as promptly as practicable after receiving such request, (i) if it is a Seasoned Issuer or Well-Known Seasoned Issuer, or if such Registration Statement is an Automatic Shelf Registration Statement, file a prospectus supplement to include such Stockholders as selling stockholders in such Registration Statement or (ii) if it is not a Seasoned Issuer or Well-Known Seasoned Issuer, and the Registrable Securities requested to be registered represent more than 5% of the outstanding Registrable Securities and the aggregate proceeds expected to be received from the sale thereof is at least $10,000,000, file a post-effective amendment to the Registration Statement to include such Stockholders in such Shelf Registration and use commercially reasonable efforts to have such post-effective amendment declared effective.
(f) Upon the Company becoming a Well-Known Seasoned Issuer, (i) the Company shall give written notice to all of the Stockholders as promptly as practicable but in no event later than ten (10) Business Days thereafter, and such notice shall describe, in reasonable detail, the basis on which the Company has become a Well-Known Seasoned Issuer, and (ii) the Company shall, as promptly as practicable and subject to any Suspension Period, register, under an Automatic Shelf Registration Statement, the sale of all of the Registrable Securities in accordance with the terms of this Agreement. The Company shall use its commercially reasonable efforts to file such Automatic Shelf Registration Statement as promptly as practicable, but in no event later than fifteen (15) Business Days after it becomes a Well-Known Seasoned Issuer, and to cause such Automatic Shelf Registration Statement to remain effective thereafter until the date set forth in Section 2.05(a)(ii) . The Company shall give written notice of filing such Registration Statement to all of the Stockholders as promptly as practicable thereafter. The Company shall not be required to include any Stockholder as a Selling Stockholder in any Registration Statement or prospectus unless such Stockholder has complied with Section 2.16 . At any time after the filing of an Automatic Shelf Registration Statement by the Company, if it is reasonably likely that it will no longer be a Well-Known Seasoned Issuer as of a future determination date (the “ Determination Date ”), at least thirty (30) days prior to such Determination Date, the Company shall (A) give written
 
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notice thereof to all of the Stockholders as promptly as practicable but in no event later than ten (10) Business Days prior to such Determination Date and (B) if the Company is eligible to file a Registration Statement on Form S-3 with respect to a secondary public offering of its equity securities, file a Registration Statement on Form S-3 with respect to a Shelf Registration in accordance with Section 2.02(a) , treating all selling stockholders identified as such in the Automatic Shelf Registration Statement (and amendments or supplements thereto) as Requesting Stockholders and use all commercially reasonable efforts to have such Registration Statement declared effective prior to the Determination Date. Any registration pursuant to this Section 2.02(f) shall be deemed a Shelf Registration for purposes of this Agreement.
(g) Notwithstanding anything to the contrary, no Shelf Registration pursuant to this Section 2.02 shall be deemed a Demand Registration or be counted against the number of Demand Registrations to which a Stockholder Group is entitled under Section  2.01(a) .
Section 2.03. Piggyback Registration . (a) If, at any time following the six-month anniversary of the Effective Date, the Company proposes to register any Company Securities under the Securities Act (other than a registration on Form S-8 or Form S-4 or any similar or successor form under the Securities Act, relating to Shares or any other class of Company Securities issuable upon exercise of employee stock options or in connection with any employee benefit or similar plan of the Company or in connection with a direct or indirect acquisition by the Company of another Person) other than in connection with a rights offering, whether or not for sale for its own account, the Company shall each such time give prompt notice (via facsimile or electronic transmission) at least ten (10) Business Days prior to the anticipated filing date of the registration statement relating to such registration to each Stockholder Group, which notice shall set forth such Stockholder Group’s rights under this Section 2.03 and shall offer such Stockholder Group the opportunity to include in such registration statement the number of Registrable Securities of the same class or series as those proposed to be registered as each such Stockholder Group may request (a “ Piggyback Registration ”), subject to the provisions of Section 2.03(b) . Upon the request of any such Stockholder Group made within ten (10) Business Days after the receipt of notice from the Company regarding a Piggyback Registration (which request shall specify the number of Registrable Securities intended to be registered by such Stockholder Group), the Company shall use its commercially reasonable efforts to effect the registration under the Securities Act of all Registrable Securities that the Company has been so requested to register by all such Stockholder Groups, to the extent requisite to permit the disposition of the Registrable Securities so to be registered in accordance with the plan of distribution intended by the Company for such registration statement; provided that (i) if such registration involves a Public Offering, all such Registering Stockholders requesting to be included in the registration must sell their Registrable Securities to the underwriters selected as provided in Section 2.05(f) on the same terms and conditions as apply to the
 
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Company (or, if the Company is not offering any Company Securities, the Persons on whose behalf the registration was initially undertaken) and (ii) if, at any time after giving notice of its intention to register any Company Securities pursuant to this Section 2.03(a) and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason not to register such securities, the Company shall give notice to all Registering Stockholders and, thereupon, shall be relieved of its obligation to register any Registrable Securities in connection with such registration. No registration effected under this Section 2.03 shall relieve the Company of its obligations to effect a Demand Registration or Shelf Registration to the extent required by Section 2.01 . The Company shall pay all Registration Expenses in connection with each Piggyback Registration.
(b) If a Piggyback Registration involves a Public Offering (other than any Demand Registration, in which case the provisions with respect to priority of inclusion in such offering set forth in Section 2.01(e) shall apply) and the lead managing underwriter advises the Company that, in its view, the number of Registrable Securities that the Company and such Registering Stockholders intend to include in such registration exceeds the Maximum Offering Size, the Company shall include in such registration, in the following priority, up to the Maximum Offering Size:
(i) first, so much of the Registrable Securities proposed to be registered for the account of the Company as would not cause the offering to exceed the Maximum Offering Size;
(ii) second, all Registrable Securities requested to be included in such registration by any Registering Stockholders pursuant to this Section 2.03 (allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among such Stockholder Groups on the basis of the relative number of shares of Registrable Securities so requested to be included in such registration by each such Stockholder Group); and
(iii) third, any securities proposed to be registered for the account of any other Persons with such priorities among them as the Company shall determine.
Section 2.04. Lock-Up Agreements . (a) Each Stockholder hereby agrees that it will not effect any public sale or distribution (including sales pursuant to Rule 144) of Registrable Securities, (i) during (A) the fourteen (14) days prior to and the 90-day period beginning on the effective date of the registration of such Registrable Securities in connection with a Public Offering (which period following the effective date may, in each case, be extended to the extent required by applicable law, rule or regulation) or (B) such shorter period as the underwriters participating in such Public Offering may require, and (ii) upon notice from the Company of the commencement of a Public Offering in connection with any Shelf Registration, during (A) fourteen (14) days prior to and the
 
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90-day period beginning on the date of commencement of such Public Offering or (B) such shorter period as the underwriters participating in such Public Offering may require, in each case except as part of such Public Offering. Each Stockholder agrees to execute a lock-up agreement in favor of the underwriters in form and substance reasonably acceptable to the Company and the underwriters to such effect and, in any event, that the underwriters in any relevant offering shall be third party beneficiaries of this Section 2.04(a) .
(b) The Company shall not effect any public sale or distribution of Registrable Securities (except pursuant to registrations on Form S-8 or Form S-4 or any similar or successor form under the Securities Act), (i) with respect to any Public Offering pursuant to a Demand Registration or any Piggyback Registration in which the holders of Registrable Securities are participating, during (A) the fourteen (14) days prior to and the 90-day period beginning on the effective date of such registration (which period following the effective date may, in each case, be extended to the extent required by applicable law, rule or regulation) or (B) such shorter period as the underwriters participating in such Public Offering may require, and (ii) upon notice from any holder(s) of Registrable Securities subject to a Shelf Registration that such holder(s) intend to effect a Public Offering of Registrable Securities pursuant to such Shelf Registration (upon receipt of which, the Company will promptly notify all other Stockholders of the date of commencement of such Public Offering), during (A) the fourteen (14) days prior to and the 90-day period beginning on the date of commencement of such Public Offering and (B) such shorter period as the underwriters participating in such Public Offering may require), in each case except as part of such Public Offering.
Section 2.05. Registration Procedures . Whenever Stockholder Groups request that any Registrable Securities be registered pursuant to Section 2.01 , 2.02 or 2.03 , subject to the provisions of such Sections, the Company shall use its commercially reasonable efforts to effect the registration and the sale of such Registrable Securities in accordance with the intended method of disposition thereof as soon as reasonably practicable, and, in connection with any such request:
(a) The Company shall as soon as reasonably practicable prepare and file with the SEC a Registration Statement on any form for which the Company then qualifies or that counsel for the Company shall deem appropriate and which form shall be available for the sale of the Registrable Securities to be registered thereunder in accordance with the intended method of distribution thereof, and use its commercially reasonable efforts to cause such filed Registration Statement to become and remain effective for a period of (i) not less than one hundred eighty (180) days (or, if sooner, until all Registrable Securities have been sold under such Registration Statement), or (ii) in the case of a Shelf Registration, until the earlier of the date (x) on which all of the securities covered by such Shelf Registration are no longer Registrable Securities and (y) on which the Company cannot extend the effectiveness of such Shelf Registration because it is no longer eligible for use of Form S-3; subject in each case to any Suspension Period.
 
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(b) Prior to filing a Registration Statement or related prospectus or any amendment or supplement thereto (including any documents incorporated by reference therein), or before using any Free Writing Prospectus, the Company shall provide to each Registering Stockholder, the Holders’ Counsel and each underwriter, if any, with an adequate and appropriate opportunity to review and comment on such Registration Statement, each Prospectus included therein (and each amendment or supplement thereto) and each Free Writing Prospectus proposed to be filed with the SEC, and thereafter the Company shall furnish to such Registering Stockholder, the Holders’ Counsel and underwriter, if any, such number of copies of such Registration Statement, each amendment and supplement thereto filed with the SEC (in each case including all exhibits thereto and documents incorporated by reference therein), the prospectus included in such Registration Statement (including each preliminary prospectus and any summary prospectus) and any other prospectus filed under Rule 424, Rule 430A, Rule 430B or Rule 430C under the Securities Act and such other documents as such Registering Stockholder or underwriter may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Registering Stockholder; provided , however , that in no event shall the Company be required to provide to any Person any materials, information or document required to be filed by the Company pursuant to the Exchange Act prior to its filing other than in connection with a Public Offering. In addition, the Company shall, as expeditiously as practicable, keep Holders’ Counsel advised in writing as to the initiation and progress of any registration under Sections 2.01 , 2.02 and 2.03 and provide Holders’ Counsel with copies of all correspondence (including any comment letter) with the SEC, any self regulatory organization or other governmental agency in connection with any such Registration Statement. Each Registering Stockholder shall have the right to request that the Company modify any information contained in such Registration Statement, amendment and supplement thereto pertaining to such Registering Stockholder and the Company shall use its commercially reasonable efforts to comply with such request; provided, however , that the Company shall not have any obligation so to modify any information if the Company reasonably expects that so doing would cause the prospectus to contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading.
(c) After the filing of the Registration Statement, the Company shall (i) cause the related prospectus to be supplemented by any required prospectus supplement, and, as so supplemented, to be filed pursuant to Rule 424 under the Securities Act, (ii) comply with the provisions of the Securities Act applicable to the Company with respect to the disposition of all Registrable Securities covered by such Registration Statement during the applicable period in accordance with the intended methods of disposition by the Registering Stockholder thereof set forth in such Registration Statement or supplement to
 
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such prospectus and (iii) promptly notify each Registering Stockholder holding Registrable Securities covered by such Registration Statement and the Holders’ Counsel any stop order issued or threatened by the SEC or any state securities commission with respect thereto and take all commercially reasonable actions required to prevent the entry of such stop order or to remove it if entered.
(d) The Company shall use its commercially reasonable efforts to (i) register or qualify the Registrable Securities covered by such Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as any Registering Stockholder holding such Registrable Securities reasonably (in light of such Stockholder Group’s intended plan of distribution) requests, and continue such registration or qualification in effect in such jurisdiction for the shortest of (A) as long as permissible pursuant to the laws of such jurisdiction, (B) as long as any such Registering Stockholder requests or (C) until all such Registrable Securities are sold and (ii) cause such Registrable Securities to be registered with or approved by such other governmental agencies or authorities as may be necessary by virtue of the business and operations of the Company and do any and all other acts and things that may be reasonably necessary or advisable to enable such Stockholder Group to consummate the disposition of the Registrable Securities owned by such Stockholder Group; provided that the Company shall not be required to (A) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 2.05(d) , (B) subject itself to taxation in any such jurisdiction or (C) consent to general service of process in any such jurisdiction.
(e) The Company shall immediately notify each Registering Stockholder holding such Registrable Securities covered by such Registration Statement (i) at any time when a prospectus relating thereto is required to be delivered under the Securities Act, upon the discovery that, or upon the occurrence of an event as a result of which, the preparation of a supplement or amendment to such prospectus is required so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus will not include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements in light of the circumstances under which they were made not misleading and the Company shall promptly (subject to any applicable Suspension Period) prepare and make available to each Registering Stockholder and file with the SEC any such supplement or amendment, (ii) as soon as the Company becomes aware of any request by the SEC or any Federal or state governmental authority for amendments or supplements to a Registration Statement or related prospectus covering Registrable Securities or for additional information relating thereto, (iii) as soon as the Company becomes aware of the issuance or threatened issuance by the SEC of any stop order suspending or threatening to suspend the effectiveness of a Registration Statement covering the Registrable Securities or (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any proceeding for such purpose.
 
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(f) (i) The Registering Stockholders holding a majority of the Registrable Securities to be included in a Demand Registration or intended to be sold pursuant to a Public Offering pursuant to a “take down” under a Shelf Registration shall have the right to select an underwriter or underwriters in connection with any Public Offering resulting from the exercise of a Demand Registration or a Shelf Registration (which underwriter or underwriters may include any Affiliate of any Stockholder Group so long as including such Affiliate would not require that the separate engagement of a qualified independent underwriter with respect to such offering), subject to the Company’s approval (which shall not be unreasonably withheld, conditioned or delayed) and (ii) the Company shall select an underwriter or underwriters in connection with any other Public Offering. In connection with any Public Offering, the Company shall enter into customary agreements (including an underwriting agreement in customary form) and take all other actions as are reasonably required in order to expedite or facilitate the disposition of such Registrable Securities in any such Public Offering, including, if required, the engagement of a “qualified independent underwriter” in connection with the qualification of the underwriting arrangements with FINRA.
(g) Upon execution of confidentiality agreements in form and substance reasonably satisfactory to the Board, the Company shall make available for inspection by any Stockholder Group and any underwriter participating in any disposition pursuant to a Registration Statement being filed by the Company pursuant to this Section 2.05 and any attorney, accountant or other professional retained by any such Stockholder Group or underwriter (collectively, the “ Inspectors ”), all financial and other records, pertinent corporate documents and properties of the Company (collectively, the “ Records ”) as shall be reasonably necessary or desirable to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any Inspectors in connection with such Registration Statement. Records that the Company determines, in good faith, to be confidential and that it notifies the Inspectors are confidential shall not be disclosed by the Inspectors unless (i) the disclosure of such Records is necessary to avoid or correct a misstatement or omission in such Registration Statement, (ii) the release of such Records is ordered pursuant to a subpoena or other order from a court of competent jurisdiction, (iii) disclosure of such Records is necessary to comply with federal or state securities laws or the rules of any securities exchange or trading market on which the Common Stock is listed or traded or is otherwise required by law, rule, regulation or legal process, (iv) the information in such Records was known to the Inspectors on a non-confidential basis prior to its disclosure by the Company or has been made generally available to the public, (v) the information in such Records is or becomes available to the public other than as a result of disclosure by any Inspector in violation the confidentiality agreements or (vi) is or was independently developed by any Inspector without the benefit of the information
 
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in such Records. Each Registering Stockholder agrees that information obtained by it as a result of such inspections shall be deemed confidential and shall not be used by it or its Affiliates for any other purpose, including as the basis for any market transactions in any securities of the Company, unless and until such information is made generally available to the public. Each Registering Stockholder further agrees that, upon learning that disclosure of such Records is sought in a court of competent jurisdiction, it shall, to the extent permitted by applicable law, give notice to the Company and allow the Company, at its expense, to undertake appropriate action to prevent disclosure of the Records deemed confidential.
(h) The Company shall furnish to each Registering Stockholder and to each such underwriter, if any, a signed counterpart, addressed to such Registering Stockholder or underwriter, of (i) an opinion or opinions of counsel to the Company and (ii) a comfort letter or comfort letters from the Company’s independent public accountants, each in customary form and covering such matters of the kind customarily covered by opinions or comfort letters, as the case may be, any Registering Stockholder or the lead managing underwriter therefor reasonably requests.
(i) The Company shall otherwise comply with all applicable rules and regulations of the SEC, and make available to its security holders, as soon as reasonably practicable, an earnings statement or such other document that shall satisfy the provisions of Section 11(a) of the Securities Act and the requirements of Rule 158 thereunder.
(j) The Company may require each Registering Stockholder promptly to furnish in writing to the Company such information regarding the distribution of the Registrable Securities as the Company may from time to time reasonably request and such other information as may be reasonably required in connection with such registration.
(k) Each Registering Stockholder agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 2.05(e) , such Stockholder shall forthwith discontinue disposition of Registrable Securities pursuant to the Registration Statement (including any Shelf Registration) covering such Registrable Securities until such Stockholder’s receipt of (i) copies of the supplemented or amended prospectus from the Company or (ii) further notice from the Company that distribution can proceed without an amended or supplemented prospectus, and, in the circumstances described in clause (i), if so directed by the Company, such Stockholder shall deliver to the Company all copies, other than any permanent file copies then in such Stockholder’s possession, of the most recent prospectus covering such Registrable Securities at the time of receipt of such notice. If the Company shall give such notice, the Company shall extend the period during which such registration statement shall be maintained effective (including the period referred to in Section 2.05(a) ) by the number of days during the period from and including the date of the giving of notice pursuant to Section 2.05(e) to the date when the Company shall (x) make available to such Stockholder a prospectus supplemented or amended to conform with the requirements of Section 2.05(e) or (y) deliver to such Stockholder the notice described in clause (ii) .
 
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(l) The Company shall use its commercially reasonable efforts to list all Registrable Securities of any class or series covered by such Registration Statement on any national securities exchange on which any of the Registrable Securities of such class or series are then listed or traded.
(m) The Company shall have appropriate officers of the Company (i) upon reasonable request and at reasonable times prepare and make presentations at any “road shows” and before analysts and rating agencies, as the case may be, (ii) take other actions to obtain ratings for any Registrable Securities and (iii) otherwise use its commercially reasonable efforts to cooperate as requested by the underwriters in the offering, marketing or selling of the Registrable Securities.
(n) The Company shall as soon as possible following its actual knowledge thereof, notify each Registering Stockholder: (i) when a prospectus, any prospectus supplement, a Registration Statement or a post-effective amendment to a Registration Statement has been filed with the SEC, and, with respect to a Registration Statement or any post-effective amendment, when the same has become effective; (ii) of any request by the SEC or any other federal or state governmental authority for amendments or supplements to a Registration Statement, a related prospectus (including a Free Writing Prospectus) or for any other additional information; or (iii) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceedings for such purpose.
(o) The Company shall reasonably cooperate with each Registering Stockholder and each underwriter participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made by FINRA.
(p) The Company shall take all other steps reasonably necessary to effect the registration of such Registrable Securities and reasonably cooperate with the holders of such Registrable Securities to facilitate the disposition of such Registrable Securities.
(q) The Company shall, within the deadlines specified by the Securities Act, make all required filings of all prospectuses (including any Free Writing Prospectus) with the SEC and make all required filing fee payments in respect of any Registration Statement or related prospectus used under this Agreement (and any offering covered hereby).
(r) The Company shall, if such registration is pursuant to a Registration Statement on Form S-3 or any similar short-form registration, include in such Registration Statement such additional information for marketing purposes as the managing underwriter reasonably requests.
 
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Section 2.06. Indemnification by the Company . The Company agrees to indemnify and hold harmless each Registering Stockholder holding Registrable Securities covered by a Registration Statement, its partners, Affiliates, stockholders, members, officers, directors, employees and agents, and each Person, if any, who controls such Registering Stockholder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively, “ Stockholder Parties ”) from and against any and all losses, claims, damages, liabilities and expenses (including reasonable expenses of investigation and reasonable attorneys’ fees and expenses) (“ Damages ”) caused by or relating to any untrue statement or allegedly untrue statement of a material fact contained in any Registration Statement or prospectus relating to the Registrable Securities (as amended or supplemented if the Company shall have furnished any amendments or supplements thereto) or any preliminary prospectus or Free Writing Prospectus relating to the Registrable Securities (including any information that has been deemed to be a part of any prospectus under Rule 159 under the Securities Act), or caused by or relating to any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however , that the Company shall not be liable to any Stockholder Party for any Damages that are caused by or related to any such untrue statement or omission or alleged untrue statement or omission so made based upon information furnished in writing to the Company by or on behalf of such Registering Stockholder expressly for use therein. The Company also agrees to indemnify and hold harmless any underwriters of the Registrable Securities, their respective officers and directors and each Person who controls any underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act on substantially the same basis as that of the indemnification of the Registering Stockholders provided in this Section 2.06 .
Section 2.07. Indemnification by Registering Stockholders . Each Registering Stockholder holding Registrable Securities included in any Registration Statement agrees, severally but not jointly, to indemnify and hold harmless (i) the Company, (ii) each Person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, (iii) each other Registering Stockholder participating in any offering of Registrable Securities and (iv) the respective partners, Affiliates, stockholders, members, officers, directors, employees and agents of each of the Persons specified in clauses (i)  through (iii)  from and against all Damages to the same extent as the foregoing indemnity from the Company to such Registering Stockholder, but only with respect to information furnished in writing by or on behalf of such Registering Stockholder expressly for use in any Registration Statement or prospectus relating to the Registrable Securities, or any amendment or supplement thereto, or any preliminary prospectus or Free Writing Prospectus relating to the Registrable Securities (including any information that has been deemed to be a part of any prospectus under
 
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Rule 159 under the Securities Act). Each Registering Stockholder also agrees to indemnify and hold harmless any underwriters of the Registrable Securities, their respective officers and directors and each Person who controls any underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act on substantially the same basis as that of the indemnification of the Company and the other Registering Stockholders provided in this Section 2.07 . As a condition to including Registrable Securities in any Registration Statement filed in accordance with Article 2, the Company may require that it shall have received an undertaking reasonably satisfactory to it from any underwriter to indemnify and hold it harmless to the extent customarily provided by underwriters with respect to similar securities and offerings. No Registering Stockholder shall be liable under this Section 2.07 for any Damages in excess of the net proceeds realized by such Registering Stockholder in the sale of Registrable Securities of such Registering Stockholder to which such Damages relate.
Section 2.08. Conduct of Indemnification Proceedings . If any proceeding (including any investigation by any governmental authority) shall be instituted involving any Person in respect of which indemnity may be sought pursuant to Section 2.06 or 2.07 , such Person (an “ Indemnified Party ”) shall promptly notify the Person against whom such indemnity may be sought (the “ Indemnifying Party ”) in writing and the Indemnifying Party shall assume the defense thereof, including the employment of counsel reasonably satisfactory to such Indemnified Party, and shall assume the payment of all reasonable fees and expenses; provided that the failure of any Indemnified Party so to notify the Indemnifying Party shall not relieve the Indemnifying Party of its obligations hereunder except to the extent that the Indemnifying Party is materially prejudiced by such failure to notify. In any such proceeding, any Indemnified Party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless (i) the Indemnifying Party and the Indemnified Party shall have mutually agreed to the retention of such counsel or (ii) in the reasonable judgment of such Indemnified Party, representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that, in connection with any proceeding or related proceedings in the same jurisdiction, the Indemnifying Party shall not be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for all such Indemnified Parties, and that all such fees and expenses shall be reimbursed promptly after receipt of an invoice setting forth such fees and expenses in reasonable detail. In the case of any such separate firm for the Indemnified Parties, such firm shall be designated in writing by the Indemnified Parties. The Indemnifying Party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent, or if there be a final judgment for the plaintiff, the Indemnifying Party shall indemnify and hold harmless each Indemnified Party from and against any Damages (to the extent obligated herein) by reason of such settlement or judgment. Without the prior written consent of each affected Indemnified Party, no Indemnifying Party shall effect any settlement of any pending or threatened proceeding in
 
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respect of which such Indemnified Party is or could have been a party and indemnity could have been sought hereunder by such Indemnified Party, unless such settlement includes an unconditional release of such Indemnified Party from all liability arising out of such proceeding.
Section 2.09. Contribution . If the indemnification provided for in Section 2.06 or 2.07 is unavailable to the Indemnified Parties or insufficient in respect of any Damages, then each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such Damages in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and the Indemnified Parties in connection with such actions which resulted in such Damages, as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and the Indemnified Parties shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact has been made by, or relates to information supplied by, such Indemnifying Party or the Indemnified Parties and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such action.
The parties agree that it would not be just and equitable if contribution pursuant to this Section 2.09 were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by a party as a result of the Damages referred to in the preceding paragraph shall be deemed to include, subject to the limitations set forth in Sections 2.06 and 2.07 , any legal or other expenses reasonably incurred by a party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 2.09 , no Registering Stockholder shall be required to contribute any amount in excess of the net proceeds (after deducting the underwriters’ discounts and commissions) received by such Registering Stockholder in the offering. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. Each Registering Stockholder’s obligation to contribute pursuant to this Section 2.09 is several in the proportion that the proceeds of the offering received by such Registering Stockholder bears to the total proceeds of the offering received by all such Registering Stockholders and not joint.
Section 2.10. Participation in Public Offering . No Stockholder may participate in any Public Offering hereunder unless such Stockholder (i) agrees to sell such Stockholder’s Registrable Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements and the provisions of this Agreement in respect of registration rights.
 
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Section 2.11. Other Indemnification . Indemnification similar to that specified herein (with appropriate modifications) shall be given by the Company and each Registering Stockholder participating therein with respect to any required registration or other qualification of securities under any federal or state law or regulation or governmental authority other than the Securities Act.
Section 2.12. Cooperation by the Company . At any time following the six-month anniversary of the Effective Date, if any Stockholder shall transfer, assign, sell, convey or otherwise dispose of any Registrable Securities pursuant to Rule 144, the Company shall reasonably cooperate (subject to the terms and conditions of the Certificate of Incorporation) with such Stockholder, provide to such Stockholder such information as such Stockholder shall reasonably request and make publicly available information necessary to permit sales pursuant to Rule 144 for so long as necessary.
Section 2.13. Transfer of Registration Rights . None of the rights of any Stockholder Group under this Article 2 shall be transferable or assignable by any Stockholder Group to any Person acquiring Company Securities in any Public Offering or any other registered offering or other transaction pursuant to a prospectus which is a part of a Registration Statement or pursuant to Rule 144. The rights of a Stockholder Group hereunder may be transferred or assigned in connection with a transfer of Registrable Securities to (i) any Affiliate of a Stockholder Group or (ii) any Person other than a Stockholder Group if at least 5% of the Common Stock is being transferred to such Person in a single transaction or a series of related transactions; provided , that, such Person shall not have the right to transfer or assign any rights hereunder in connection with any subsequent transfer or transfers of any Registrable Securities to any Person other than a Stockholder Group. Notwithstanding the foregoing, such rights may only be transferred or assigned if all of the following additional conditions are satisfied: (x) such transfer or assignment is effected in accordance with applicable securities laws and (y) the Company is given written notice by such transferor of such transfer or assignment, stating the name and address of the transferee or assignee and identifying the amount of Registrable Securities with respect to which such rights are being transferred or assigned and (z) such transferee or assignee executes and delivers to the Company an agreement to be bound by this Agreement in the form of Exhibit A. A transferee or assignee of Registrable Securities who satisfies the conditions set forth in this Section 2.13 shall thenceforth be an “Angelo Gordon Stockholder,” a “JPMorgan Stockholder” or an “Oaktree Stockholder,” as applicable, for purposes of this Agreement.
Section 2.14. Limitations on Subsequent Registration Rights . The Company agrees that it shall not enter into any agreement with any holder or prospective holder of any securities of the Company (i) that would allow such holder or prospective holder to include such securities in any Demand Registration, Piggyback Registration or Shelf
 
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Registration unless, under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that their inclusion would not reduce the amount of the Registrable Securities of the Stockholder Group included therein or (ii) on terms otherwise more favorable in the aggregate than this Agreement. The Company also represents and warrants to each Stockholder Group that it has not previously entered into any agreement with respect to any of its securities granting any registration rights to any Person with respect to the Registrable Securities.
Section 2.15. Free Writing Prospectuses . Except for a prospectus relating to Registrable Securities included in a Registration Statement, an “issuer free writing prospectus” (as defined in Rule 433 under the Securities Act) or other materials prepared by the Company, each Registering Stockholder represents and agrees that it (i) shall not make any offer relating to the Registrable Securities that would constitute an issuer free writing prospectus or that would otherwise constitute a Free Writing Prospectus and (ii) has not distributed and will not distribute any written materials in connection with the offer or sale pursuant to a Registration Statement of Registrable Securities without the prior written consent of the Company and, in connection with any Public Offering, the underwriters.
Section 2.16. Information from Registering Stockholders; Obligations of Registering Stockholders .
(a) It shall be a condition precedent to the obligations of the Company to include the Registrable Securities of any Registering Stockholder that has requested inclusion of its Registrable Securities in any Registration Statement or related prospectus, as the case may be, that such Registering Stockholder shall take the actions described in this Section 2.16 .
(b) Each Registering Stockholder that has requested inclusion of its Registrable Securities in any Registration Statement shall (i) furnish to the Company (as a condition precedent to such Registering Stockholder’s participation in such registration) in writing such information with respect to such Registering Stockholder, its ownership of Company Securities and the intended method of disposition of its Registrable Securities as the Company may reasonably request or as may be required by law or regulations for use in connection with any related Registration Statement or prospectus (or amendment or supplement thereto) and all information required to be disclosed in order to make the information previously furnished to the Company by such Registering Stockholder not contain a material misstatement of fact or necessary to cause such Registration Statement or prospectus (or amendment or supplement thereto) not to omit a material fact with respect to such Registering Stockholder necessary in order to make the statements therein not misleading and (ii) comply with the Securities Act and the Exchange Act and all applicable state securities laws and comply with all applicable regulations in connection with the registration and the disposition of Registrable Securities.
 
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(c) Each Registering Stockholder shall promptly (i) following its actual knowledge thereof, notify the Company of the occurrence of any event that makes any statement made in a Registration Statement, prospectus, issuer free writing prospectus or other Free Writing Prospectus regarding such Registering Stockholder untrue in any material respect or that requires the making of any changes in a Registration Statement, Prospectus or Free Writing Prospectus so that, in such regard, it shall not contain any untrue statement of a material fact or omit any material fact required to be stated therein or necessary to make the statements not misleading and (ii) provide the Company with such information as may be required to enable the Company to prepare a supplement or post-effective amendment to any such Registration Statement or a supplement to such prospectus or Free Writing Prospectus.
(d) Each Registering Stockholder shall use commercially reasonable efforts to cooperate with the Company in preparing the applicable Registration Statement and any related prospectus.
(e) Each Stockholder agrees that no Stockholder shall be entitled to sell any Registrable Securities pursuant to a Registration Statement or to receive a prospectus relating thereto unless such Stockholder has furnished the Company with all information required to be included in such Registration Statement by applicable securities laws in connection with the disposition of such Registrable Securities as reasonably requested by the Company.
ARTICLE 3
T ERMINATION
Section 3.01. Termination. This Agreement shall terminate on the 10 th anniversary of the date hereof; provided, however, that any Stockholder Group that ceases to own beneficially any Registrable Securities shall cease to be bound by the terms hereof other than (i) Sections 2.06 , 2.07 , 2.08 , 2.09 and 2.11 applicable to such Stockholder Group with respect to any offering of Registrable Securities completed before the date such Stockholder Group ceased to own any Registrable Securities and (ii) Sections 4.01 , 4.02 and 4.04 through 4.12 .
ARTICLE 4
MISCELLANEOUS
Section 4.01. Successors and Assigns. (a) This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, successors, legal representatives and permitted assigns.
 
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(b) Subject to Section 2.13 , neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by any party.
(c) Nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the parties hereto, and their respective heirs, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.
Section 4.02. Notices . All notices, requests and other communications to any party hereunder shall be in writing (including facsimile or electronic transmission) and shall be given,
if to the Company to:
Tribune Publishing Company
202 W. First Street
Los Angeles, CA 90012
Attention: General Counsel
Facsimile No.: (213) 237-4401
With a copy to:
Debevoise & Plimpton LLP
919 Third Avenue
New York, NY 10022
Attention: Peter J. Loughran, Esq.
Facsimile No.: (212) 521-7375
with a copy to each Stockholder Group at the address listed below.
if to the JPMorgan Stockholder, to:
Isolieren Holding Corp.
383 Madison Avenue
New York, NY 10179
Attention: Marina S. Levin
Email: marina.s.levin@jpmorgan.com
No fax number
with a copy to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
Attention: Donald S. Bernstein
Email: donald.bernstein@davispolk.com
Facsimile No.: 212-701-5092
 
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if to the Angelo Gordon Stockholder, to:
Angelo Gordon & Co. L.P.
245 Park Avenue, 26th Floor
New York, NY 10167
Attention: Gavin Baiera
Email: GBaiera@angelogordon.com
Facsimile No.: (212) 867-6395
with a copy to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
Attention: Kenneth M. Schneider
Email: kschneider@paulweiss.com
Facsimile No: (212) 492-0303
if to the Oaktree Stockholder, to:
Oaktree Capital Management, L.P.
333 South Grand Avenue, 29th Floor
Los Angeles, CA 90071
Attention: Ken Liang, Managing Director
Email: kliang@oaktreecapital.com
Facsimile No.: (213) 830-8522
with a copy to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
Attention: Kenneth M. Schneider
Email: kschneider@paulweiss.com
Facsimile No: (212) 492-0303
or such other address, facsimile number or electronic mail address as such party may hereafter specify for the purpose by notice to the other parties hereto. All notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day is a
 
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Business Day in the place of receipt. Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding Business Day in the place of receipt. Any Person that becomes a Stockholder shall provide its address, facsimile number or electronic mail address to the Company, which shall promptly provide such information to each other Stockholder.
Section 4.03. Amendments and Waivers . Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement, or in the case of a waiver, by the party against whom the waiver is to be effective. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.
Section 4.04. Governing Law . This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to the choice of law or conflicts of law.
Section 4.05. Jurisdiction . The parties hereby agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby shall be brought in the United States District Court for the Southern District of New York or any New York State court sitting in New York City, so long as one of such courts shall have subject matter jurisdiction over such suit, action or proceeding, and that any cause of action arising out of this Agreement shall be deemed to have arisen from a transaction of business in the State of New York, and each of the parties hereby irrevocably consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 4.02 shall be deemed effective service of process on such party.
Section 4.06. WAIVER OF JURY TRIAL . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
 
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Section 4.07. Specific Enforcement . Each party hereto acknowledges that the remedies at law of the other parties for a breach or threatened breach of this Agreement would be inadequate and, in recognition of this fact, any party to this Agreement, without posting any bond, and in addition to all other remedies that may be available, shall be entitled to obtain equitable relief in the form of specific performance, a temporary restraining order, a temporary or permanent injunction or any other equitable remedy that may then be available.
Section 4.08. Counterparts; Effectiveness; Third Party Beneficiaries . This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement shall become effective when each initial party hereto shall have received a counterpart hereof signed by all of the other initial parties hereto. Until and unless each initial party has received a counterpart hereof signed by the other initial parties hereto, this Agreement shall have no effect and no party shall have any right or obligation hereunder (whether by virtue of any other oral or written agreement or other communication). No provision of this Agreement is intended to confer any rights, benefits, remedies, obligations, or liabilities hereunder upon any Person other than the parties hereto and their respective successors and assigns.
Section 4.09. Entire Agreement . This Agreement, together with the Schedules and Exhibit hereto and any documents, instruments and writings that are delivered pursuant hereto, constitutes the entire agreement among the parties with respect to the subject matter of this Agreement and supersedes all prior agreements and understandings, both oral and written, among the parties hereto with respect to the subject matter of this Agreement.
Section 4.10. Severability . If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner so that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.
Section 4.11. Sophisticated Parties; Advice of Counsel . Each of the parties to this Agreement specifically acknowledges that (i) it is a knowledgeable, informed, sophisticated Person capable of understanding and evaluating the provisions set forth in this Agreement and (ii) it has been fully advised and represented by legal counsel of its own independent selection and has relied wholly upon its independent judgment and the advice of such counsel in negotiating and entering into this Agreement.
 
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Section 4.12. Certificate of Incorporation Supersedes . Nothing in this Agreement is intended to conflict with any provision of the Certificate of Incorporation and, in the event of any such conflict, the applicable provision of the Certificate of Incorporation shall supersede the conflicting provision of this Agreement. Nothing in this Agreement is intended to limit or restrict in any manner whatsoever, the rights or powers of the Company under the Certificate of Incorporation and the exercise of any such right or power by the Company shall not be, and shall not be construed to be, a breach or violation of, or a default under, this Agreement or any provision hereof.
[ Signature Pages Follow ]
 
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Very truly yours,

TRIBUNE PUBLISHING COMPANY	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
ISOLIEREN HOLDING CORP.	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
JAMES RIVER INSURANCE COMPANY
By: Angelo, Gordon & Co., L.P., as attorney-in-fact	
		
By:	 	 	
Name:	 		
Title:	 		
	
SUMMER HILL FIXED INCOME AG, LLC
By: Angelo, Gordon & Co., L.P., as attorney-in-fact	
		
By:	 	 	
Name:	 		
Title:	 		
	
NORTHWOODS CAPITAL IV, LIMITED
By: Angelo, Gordon & Co., L.P., its collateral manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG CDraftAPITAL RECOVERY PARTNERS IV, L.P.
By: AG Capital Recovery IV LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
AG CAPITAL RECOVERY PARTNERS VII, L.P.
By: AG Capital Recovery VII LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AGCR MASTER ACCOUNT LP
By: AG Capital Recovery V LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG ELEVEN PARTNERS, L.P.
By: AG Eleven LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG SUPER FUND, L.P.
By: AG Super LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
AG MM, L.P.
By: AG MM LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
AG SUPER FUND INTERNATIONAL PARTNERS, L.P.
By: AG Super Fund International LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
NUTMEG PARTNERS, L.P.
By: Nutmeg Partners LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG PRINCESS, LP
By: AG Princess LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG GLOBAL DEBT STRATEGY PARTNERS, L.P.
By: AG Global Debt Strategy LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
AG DIVERSIFIED CREDIT STRATEGIES MASTER, L.P.
By: AG Diversified Credit Strategies GP LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG CENTRE STREET PARTNERSHIP, L.P.
By: AG Centre Street GP LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
AG CNG FUND, L.P.
By: AG CNG LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
	
PHS PATRIOT FUND, L.P.
By: PHS Patriot Fund LLC, its General Partner
By: Angelo, Gordon & Co., L.P., its Manager	
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

			
OAKTREE TRIBUNE, L.P.
By: Oaktree AIF Investments, L.P., its General Partner	
		
By:	 	 	
Name:	 		
Title:	 		
		
By:	 	 	
Name:	 		
Title:	 		
 
[Tribune Publishing – Registration Rights Agreement Signature Page]

EXHIBIT A
JOINDER TO REGISTRATION RIGHTS AGREEMENT
This Joinder Agreement (this “ Joinder Agreement ”) is made as of the date written below by the undersigned (the “ Joining Party ”) in accordance with the Registration Rights Agreement dated as of                     , 20    (the “ Registration Rights Agreement ”) among [Tribune Publishing Company] and the other parties thereto, as the same may be amended from time to time. Capitalized terms used, but not defined, herein shall have the meaning ascribed to such terms in the Registration Rights Agreement.
The Joining Party hereby acknowledges, agrees and confirms that, by its execution of this Joinder Agreement, the Joining Party shall be deemed to be a party to the Registration Rights Agreement as of the date hereof and shall have all of the rights and obligations of a “Stockholder” thereunder as if it had executed the Registration Rights Agreement. The Joining Party hereby ratifies, as of the date hereof, and agrees to be bound by, all of the terms, provisions and conditions contained in the Registration Rights Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Joinder Agreement as of the date written below.
Date:                     ,         

[NAME OF JOINING PARTY]	
		
By:	 	 	
Name:	 		
Title:	 		
	
Address for Notices:	

Schedule 1
JPMorgan Parties
Isolieren Holding Corp.

Schedule 2
Angelo Gordon Funds
James River Insurance Company
Summer Hill Fixed Income AG, LLC
Northwoods Capital IV, Limited
AG Capital Recovery Partners VI, L.P.
AG Capital Recovery Partners VII, L.P.
AGCR V Master Account LP
AG Eleven Partners, L.P.
AG Super Fund, L.P.
AG MM, L.P.
AG Super Fund International Partners, L.P.
Nutmeg Partners, L.P.
AG Princess, LP
AG Global Debt Strategy Partners, L.P.
AG Diversified Credit Strategies Master, L.P.
AG Centre Street Partnership, L.P.
AG CNG Fund, L.P.
PHS Patriot Fund, L.P.

Schedule 3
Oaktree Funds
Oaktree Tribune, L.P.

Exhibit 10.6
TRIBUNE PUBLISHING COMPANY
2014 OMNIBUS INCENTIVE PLAN
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (the “ Agreement ”) is made by and between Tribune Publishing Company, a Delaware corporation (the “ Company ”), and the employee whose name is set forth below (the “ Participant ”), and is dated as of [DATE] (the “ Date of Grant ”). Pursuant to this Agreement, the Company hereby grants to the Participant an Option to purchase the number of shares of Common Stock (“ Common Stock ”) of the Company as set forth below (the “ Option ”) at the Exercise Price set forth below. The Option is subject to all of the terms and conditions set forth in this Agreement as well as all of the terms and conditions of the Tribune Publishing Company 2014 Omnibus Incentive Plan (as amended from time to time in accordance with the terms thereof, the “ Plan ”), all of which are incorporated herein in their entirety. Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

Participant:	  	[NAME]	
		
Shares of Common Stock Subject to the Option:	  	[ — ]	
		
Exercise Price:	  	$[ — ] (The exercise price is the closing price of a share of Common Stock reported on the NYSE on the Date of Grant.)	
		
Expiration Date:	  	[10 th anniversary of grant date]	
1. Vesting Schedule. Provided that the Participant has not undergone a termination of employment with the Company and its Affiliates prior to the applicable Vesting Date, the Option shall vest and become exercisable as follows:

Vesting Date	 	Vesting Percentage	

	 		

2. Exercise.
(a) Method of Exercise . The Option may be exercised by the Participant giving notice to the Company or its designated agent in accordance with instructions generally applicable to all holders of Options. The Option may be exercised only in respect of whole shares of Common Stock. At the time of exercise, the Participant must pay the aggregate Exercise Price for the portion of the Option being exercised and any applicable withholding taxes or similar taxes, charges or fees. The Participant may pay such amounts in cash, in shares of Common Stock, or in any combination thereof. The Participant may also arrange for such amounts to be paid through a broker-assisted exercise program established by the Company or pursuant to any other mechanism or in any other manner and subject to such terms and conditions as may be permitted or approved by the Committee. For the avoidance of doubt, the Participant must receive prior written approval of the Committee to use any method for the payment of the tax withholding other than in immediately available funds in U.S. dollars.
(b) Tax Withholding. In connection with any exercise, the Participant will be required to satisfy applicable withholding tax obligations as provided in Section 17(c) of the Plan.
(c) Compliance with Laws. The granting and exercising of the Option, and any other obligations of the Company under this Agreement shall be subject to all Applicable Laws and to such approvals by any regulatory or governmental agency as may be required. The Committee, in its sole discretion, may postpone the issuance or delivery of Common Stock hereunder as the Committee may consider appropriate and may require the Participant to make such representations and furnish such information as it may consider appropriate in connection with the issuance or delivery of Common Stock hereunder in compliance with applicable laws, rules, and regulations.
3. Termination of Options.
(a) Normal Termination Date. Unless earlier terminated pursuant to Section 3(b) or Section 4, the Option shall terminate at the expiration of the Option Period.
(b) Early Termination.
(i) Retirement . Upon termination of employment of the Participant to by reason of Retirement, the unvested portion of the Option shall fully vest, and the Option shall remain exercisable for three years following the Participant’s Retirement, but not later than the expiration of the Option Period.
(ii) Death or Disability. Upon termination of employment of the Participant by reason of death or Disability, all of the Option shall fully vest and remain exercisable for one year following the Participant’s termination of employment, but not later than the expiration of the Option Period.
 
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(iii) For Cause. Upon a termination of employment of the Participant for Cause, all of the Option (whether vested or unvested) shall immediately be cancelled and forfeited for no consideration.
(iv) Any Other Reason . Upon termination of employment of the Participant for any other reason (i.e., other than due to death, Disability, Retirement or for Cause), the unvested portion of an Option shall immediately be cancelled and forfeited for no consideration, and the vested portion of such Option shall remain exercisable for 90 days following termination of the Participant’s employment, but not later than the expiration of the Option Period.
4. Change in Control. Unless the Committee shall determine that the Participant will receive an Alternative Award satisfying the conditions set forth in the Plan, in the event of a Change in Control prior to the applicable Vesting Date, each vested and unvested Option shall become fully and immediately vested and, if so directed by the Committee, cancelled in exchange for a payment equal to the excess, if any, of the price paid for a share of Common Stock in the transaction resulting in the Change in Control over the applicable Option Price.
5. General.
(a) No Rights as Stockholder. The Participant shall not be deemed for any purpose to be the owner of any shares of Common Stock subject to the Option unless and until such shares shall have been issued and delivered to the Participant.
(b) Limitation on Rights; No Right to Future Grants; Extraordinary Item of Compensation. By entering into this Agreement and accepting the Option, the Participant acknowledges: ( i ) that the Plan is discretionary in nature and may be suspended or terminated by the Company at any time; ( ii ) that this Agreement does not create any contractual or other right to receive future grants of Options or any other Award; ( iii ) that participation in the Plan is voluntary; ( iv ) that the value of the Option is not part of normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; and ( v ) that the future value of the Common Stock is unknown and cannot be predicted with certainty.
(c) No Rights to Continued Employment. Neither this Agreement nor any action taken hereunder shall be construed as giving the Participant any right to be retained in the employ of the Company or any of its Affiliates.
(d) Delivery of Documents. The Participant agrees that the Company may deliver by email all notices and documents relating to the Plan or this Option (including, without limitation, a copy of the Plan) and all other documents that the Company is required to deliver to its security holders (including, without limitation, disclosures that may be required by the Securities and Exchange Commission). The Participant also agrees that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract with the Company. If the Company posts these documents on a website, it shall notify the Participant by email or such other reasonable manner as then determined by the Company.
 
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(e) Confidentiality. The Participant acknowledges having read and understood the Company’s policies on confidentiality as set forth in the [ — ] (collectively, the “ Confidentiality Policies ”) and hereby agrees that during the Participant’s employment with the Company and its Affiliates and any time thereafter, the Participant will continue to abide by the terms of the Confidentiality Policies, including with respect to any materials or information received in connection with the Option.
(f) Beneficiary. The Participant may provide the Company with a written designation of a beneficiary on such form as may be prescribed by the Committee and may, from time to time, amend or revoke such designation. If no designated beneficiary survives the Participant, the Participant’s beneficiary shall be deemed to be the Participant’s spouse (or domestic partner if such status is recognized by the Company according to the procedures established by the Company and in such jurisdiction), or if the Participant is otherwise unmarried at the time of death, the Participant’s estate.
(g) Data Privacy Consent. As a condition of the grant of the Option, the Participant consents to the collection, use and transfer of personal data as described in this paragraph. The Participant understands that the Company and its Affiliates hold certain personal information about the Participant, including his or her name, home address and telephone number, date of birth, social security number, salary, nationality, job title, ownership interests or directorships held in the Company or its Affiliates, and details of all Awards awarded, cancelled, exercised, vested or unvested (“ Data ”). The Participant further understands that the Company and its Affiliates will transfer Data amongst themselves as necessary for the purposes of implementation, administration and management of the Participant’s participation in the Plan, and that the Company and any of its Affiliates may each further transfer Data to any third parties assisting the Company in the implementation, administration and management of the Plan.
(h) Entire Agreement, etc. Except as otherwise provided by an applicable employment agreement between the Participant and the Company or an Affiliate, this Agreement and the Plan contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations, and negotiations in respect thereto. No change, modification, or waiver of any provision of this Agreement shall be valid unless the same be in writing and signed by the Company and the Participant. Any provision for the benefit of the Company contained in this Agreement may be waived, either generally or in any particular instance, by the Committee. A waiver on one occasion shall not be deemed to be a waiver of the same or any other breach on a future occasion.
(i) Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware without regard to principles of conflicts of law thereof, or principles of conflicts of laws of any other jurisdiction which could cause the application of the laws of any jurisdiction other than the State of Delaware.
 
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(j) Acceptance of Agreement . The Participant has indicated his or her consent and acknowledgment of the terms of this Agreement and the Plan by executing this Agreement pursuant to the instructions provided to the Participant by or on behalf of the Company. The Participant acknowledges receipt of the Plan, and as an express condition to the grant of the Option under the Agreement, agrees to be bound by the terms of both this Agreement and the Plan. The Participant and the Company hereby expressly agree that the use of electronic media to indicate confirmation, consent, signature, acceptance, agreement and delivery shall be legally valid and have the same legal force and effect as if the Participant and the Company executed this Agreement in paper form.
 
5

Exhibit 10.7
TRIBUNE PUBLISHING COMPANY
2014 OMNIBUS INCENTIVE PLAN
RESTRICTED STOCK UNIT AGREEMENT
THIS RESTRICTED STOCK UNIT AGREEMENT (the “ Agreement ”) is made by and between Tribune Publishing Company, a Delaware corporation (the “ Company ”), and the employee whose name is set forth below (the “ Participant ”), and is dated as of [DATE] (the “ Date of Grant ”). Pursuant to this Agreement, the Company hereby grants to the Participant the number of Restricted Stock Units set forth below (“ RSUs ”), each of which represents an unfunded and unsecured promise of the Company to deliver (or cause to be delivered) to the Participant upon settlement one share of Common Stock (“ Common Stock ”) of the Company (or cash equal to the Fair Market Value thereof) as set forth herein. The RSUs are subject to all of the terms and conditions set forth in this Agreement as well as all of the terms and conditions of the Tribune Publishing Company 2014 Omnibus Incentive Plan (as amended from time to time in accordance with the terms thereof, the “ Plan ”). Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

Participant:	  	[NAME]	  		
			
Number of RSUs:	  	[ — ]	  		
1. Vesting Schedule; Restricted Period. The Restricted Period of an RSU shall begin on the Grant Date and end on its applicable Vesting Date. Provided that the Participant has not undergone a termination of employment with the Company and its Affiliates prior to the applicable Vesting Date, the RSUs shall vest and become Released Units as follows:

Vesting Date	 	Released Units	

	 		

1

2. Settlement.
(a) Delivery of Shares or Cash . Except as otherwise expressly provided below, as soon as practicable following the applicable Vesting Date (but in no event later than the next regular payroll date of the Company following such Vesting Date), the Company shall issue or transfer to the Participant, or cause to be issued or transferred to the Participant, one share of Common Stock in respect of each RSU that became a Released Unit as of such Vesting Date; provided , however , that in accordance with Section 11(c)(ii) of the Plan, the Committee may, in its sole discretion, elect to pay cash or part cash and part Common Stock in lieu of delivering only shares of Common Stock in respect of Released Units. If a cash payment is made in respect of any RSUs in lieu of delivering shares of Common Stock, the amount of such payment shall be equal to the Fair Market Value of the Common Stock as of the applicable Vesting Date, less an amount equal to all federal, state, local, and non–U.S. income and employment taxes required to be withheld in respect of such RSUs. Notwithstanding anything else contained in this Section 2 to the contrary, if the Participant is a specified employee (within the meaning of Section 409A of the Code) delivery of any shares of Common Stock (or any cash payment in lieu thereof) on account of the Participant’s Retirement shall be delayed until the date that is six months and one day after the date upon which the Participant retires (or, if later, incurs a separation from service for purposes of such Section 409A).
(b) Tax Withholding. In connection with any settlement of RSUs, the Participant will be required to satisfy applicable withholding tax obligations as provided in Section 17(c) of the Plan. For the avoidance of doubt, the Participant must receive prior written approval of the Committee to use any method for the payment of tax withholding other than in immediately available funds in U.S. dollars.
(c) Compliance with Laws. The granting and settlement of the RSUs, and any other obligations of the Company under this Agreement shall be subject to all Applicable Laws and to such approvals by any regulatory or governmental agency as may be required. The Committee, in its sole discretion, may postpone the issuance or delivery of Common Stock hereunder as the Committee may consider appropriate and may require the Participant to make such representations and furnish such information as it may consider appropriate in connection with the issuance or delivery of Common Stock hereunder in compliance with Applicable Law.
3. Termination of Employment.
(a) Retirement. Upon termination of employment of the Participant by reason of Retirement, the unvested portion of the RSUs shall become fully vested and nonforfeitable.
(b) Death or Disability. Upon termination of employment of the Participant by reason of death or Disability, the unvested portion of the RSUs shall become fully vested and nonforfeitable.
(c) For Cause. If the Participant’s employment is terminated for Cause, all RSUs (whether or not then vested) shall automatically be forfeited and terminate immediately for no consideration.
 
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(d) Any Other Reason. Upon a termination of employment of the Participant for any other reason (i.e., other than by reason of death, Disability, Retirement or for Cause), the unvested portion of the RSUs shall terminate and be forfeited for no consideration.
4. Change in Control. Unless the Committee shall determine that the Participant will receive an Alternative Award satisfying the conditions set forth in the Plan, in the event of a Change in Control occurring prior to the applicable Vesting Date, the unvested portion of the RSUs shall vest and the Restricted Period on all such RSUs shall lapse, except to the extent that the Committee reasonably determines in good faith, prior to the occurrence of the Change in Control, that Alternative Awards shall be granted in respect of all or any portion of such RSUs.
5. General.
(a) No Rights as Stockholder; Dividend Equivalents. The Participant shall not be deemed for any purpose to be the owner of any shares of Common Stock subject to the RSUs unless and until such shares shall have been issued and delivered to the Participant. In the event that the Company pays any ordinary dividends in cash on the Common Stock during the period (and to the extent) the RSUs remain outstanding, the Company shall credit dividend equivalents to an account for the Participant on the terms and conditions specified below. The dividend equivalents shall equal the dividends that would have been paid with respect to the shares of Common Stock underlying the RSU had such shares been outstanding at the record date for any such dividends. The dividend equivalents credited hereunder shall accumulate, without interest, and be paid in cash at the time any applicable Released Units are settled, or shall be forfeited at the time the corresponding RSUs are forfeited.
(b) Limitation on Rights; No Right to Future Grants; Extraordinary Item of Compensation. By entering into this Agreement and accepting the RSUs, the Participant acknowledges: ( i ) that the Plan is discretionary in nature and may be suspended or terminated by the Company at any time; ( ii ) that this Agreement does not create any contractual or other right to receive future grants of RSUs or any other Award; ( iii ) that participation in the Plan is voluntary; ( iv ) that the value of the RSUs is not part of normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; and ( v ) that the future value of the Common Stock is unknown and cannot be predicted with certainty.
(c) No Rights to Continued Employment. Neither this Agreement nor any action taken hereunder shall be construed as giving the Participant any right to be retained in the employ of the Company or any of its Affiliates.
(d) Delivery of Documents. The Participant agrees that the Company may deliver by email all notices and documents relating to the Plan or the RSUs (including, without limitation, a copy of the Plan) and all other documents that the Company is required to deliver to its security holders (including, without limitation, disclosures that may be required by the Securities and Exchange Commission). The Participant also agrees
 
3

that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract with the Company. If the Company posts these documents on a website, it shall notify the Participant by email or such other reasonable manner as then determined by the Company.
(e) Confidentiality. The Participant acknowledges having read and understood the Company’s policies on confidentiality as set forth in the [ — ] (collectively, the “ Confidentiality Policies ”) and hereby agrees that during the Participant’s employment with the Company and its Affiliates and any time thereafter, the Participant will continue to abide by the terms of the Confidentiality Policies, including with respect to any materials or information received in connection with the RSUs.
(f) Beneficiary. The Participant may provide the Company with a written designation of a beneficiary on such form as may be prescribed by the Committee and may, from time to time, amend or revoke such designation. If no designated beneficiary survives the Participant, the Participant’s beneficiary shall be deemed to be the Participant’s spouse (or domestic partner if such status is recognized by the Company according to the procedures established by the Company and in such jurisdiction), or if the Participant is otherwise unmarried at the time of death, the Participant’s estate.
(g) Data Privacy Consent. As a condition of the grant of the RSUs, the Participant consents to the collection, use and transfer of personal data as described in this paragraph. The Participant understands that the Company and its Affiliates hold certain personal information about the Participant, including his or her name, home address and telephone number, date of birth, social security number, salary, nationality, job title, ownership interests or directorships held in the Company or its Affiliates, and details of all Awards awarded, cancelled, exercised, vested or unvested (“ Data ”). The Participant further understands that the Company and its Affiliates will transfer Data amongst themselves as necessary for the purposes of implementation, administration and management of the Participant’s participation in the Plan, and that the Company and any of its Affiliates may each further transfer Data to any third parties assisting the Company in the implementation, administration and management of the Plan.
(h) Entire Agreement, etc. Except as otherwise provided by an applicable employment agreement between the Participant and the Company or an Affiliate, this Agreement and the Plan contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations, and negotiations in respect thereto. No change, modification, or waiver of any provision of this Agreement shall be valid unless the same be in writing and signed by the Company and the Participant. Any provision for the benefit of the Company contained in this Agreement may be waived, either generally or in any particular instance, by the Committee. A waiver on one occasion shall not be deemed to be a waiver of the same or any other breach on a future occasion.
(i) Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware without regard to principles of conflicts of law thereof, or principles of conflicts of laws of any other jurisdiction which could cause the application of the laws of any jurisdiction other than the State of Delaware.
 
4

(j) Acceptance of Agreement . The Participant has indicated his or her consent and acknowledgment of the terms of this Agreement and the Plan by executing this Agreement pursuant to the instructions provided to the Participant by or on behalf of the Company. The Participant acknowledges receipt of the Plan, and as an express condition to the grant of the RSUs under the Agreement, agrees to be bound by the terms of both this Agreement and the Plan. The Participant and the Company hereby expressly agree that the use of electronic media to indicate confirmation, consent, signature, acceptance, agreement and delivery shall be legally valid and have the same legal force and effect as if the Participant and the Company executed this Agreement in paper form.
 
5

Exhibit 21.1
List of Subsidiaries of Tribune Publishing Company

Name of Subsidiary	  	Jurisdiction of Organization	  	Ownership Percentage	 	
Tribune Publishing Company, LLC	  	Delaware	  	 	100	%	
The Baltimore Sun Company, LLC	  	Delaware	  	 	100	%	
Chicago Tribune Company, LLC	  	Delaware	  	 	100	%	
The Daily Press, LLC	  	Delaware	  	 	100	%	
The Morning Call, LLC	  	Delaware	  	 	100	%	
Los Angeles Times Communications LLC	  	Delaware	  	 	100	%	
Orlando Sentinel Communications Company, LLC	  	Delaware	  	 	100	%	
Sun-Sentinel Company, LLC	  	Delaware	  	 	100	%	
Chicagoland Publishing Company, LLC	  	Delaware	  	 	100	%	
Tribune Direct Marketing, LLC	  	Delaware	  	 	100	%	
CIPS Marketing Group, Inc.	  	California	  	 	50	%	
California Community News, LLC	  	Delaware	  	 	100	%	
The Hartford Courant Company, LLC	  	Delaware	  	 	100	%	
Hoy Publications, LLC	  	Delaware	  	 	100	%	
Builder Media Solutions, LLC	  	Delaware	  	 	100	%	
Tribune Washington Bureau, LLC	  	Delaware	  	 	100	%	
Tribune Interactive, LLC	  	Delaware	  	 	100	%	
Tribune 365, LLC	  	Delaware	  	 	100	%	
Tribune Content Agency, LLC	  	Delaware	  	 	100	%	
McClatchy / Tribune Information Services	  	District of Columbia	  	 	100	%	
HomeFinder.com, LLC	  	Delaware	  	 	33.33	%	
Blue Lynx Media, LLC	  	Delaware	  	 	100	%	
forsalebyowner.com, LLC	  	Delaware	  	 	100	%	
Tribune Content Agency London, LLC	  	Delaware	  	 	100	%	
Tribune Hong Kong Limited	  	Hong Kong	  	 	100	%	
Internet Foreclosure Service, LLC	  	Delaware	  	 	100	%	
ForSaleByOwner.com Referral Services, LLC	  	Delaware	  	 	100	%	
Local Pro Plus Realty, LLC	  	Delaware	  	 	100	%	
TCA News Service, LLC	  	Delaware	  	 	100	% 	
Capital-Gazette Communications, LLC	  	Maryland	  	 	100	% 	
Carroll County Times, LLC	  	Maryland	  	 	100	% 	

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Exhibit 99.1
Preliminary and Subject to Completion, dated June 12, 2014
INFORMATION STATEMENT
TRIBUNE PUBLISHING COMPANY
Common Stock, Par Value $0.01 Per Share
This information statement is being sent to you as a stockholder or warrantholder of Tribune Company (“Tribune”) to describe the pro rata distribution to Tribune stockholders and warrantholders of 98.5% of the outstanding shares of common stock of Tribune Publishing Company (“Tribune Publishing”).
In the distribution, holders of Tribune Class A and Class B common stock and warrants will receive 0.25 of a share of Tribune Publishing common stock for every share of Tribune common stock or warrant, respectively, owned at 5:00 p.m., New York time, on         , 2014, the record date for the distribution. No fractional shares of Tribune Publishing common stock will be issued. If you would be entitled to a fractional share of Tribune Publishing common stock, you will receive cash for the market value thereof.
Tribune Publishing is currently a subsidiary of Tribune and will own and operate the publishing business of Tribune following the distribution. Tribune will continue to own and operate its broadcasting and other businesses following the distribution. Following the distribution, Tribune will own shares of Tribune Publishing representing 1.5% of the common stock, and Tribune Publishing will be a separate public company.
We expect the distribution of Tribune Publishing common stock to be completed on or about         , 2014. You do not have to vote or take any other action to receive your shares of Tribune Publishing common stock or cash in lieu of fractional shares. You will not be required to surrender your Tribune shares or warrants or pay anything. Your shares of Tribune Publishing common stock will be distributed by book-entry, which means that we will not issue physical stock certificates. The number of shares of Tribune Class A and Class B common stock or warrants that you currently own will not change as a result of the distribution.
To implement the distribution, Tribune will distribute the shares of Tribune Publishing common stock on a pro rata basis to Tribune’s stockholders and warrantholders in a manner that is intended to be tax-free to its stockholders and warrantholders for U.S. federal income tax purposes, except for cash that stockholders receive in lieu of fractional shares.
Tribune currently owns all of the outstanding shares of Tribune Publishing. Accordingly, there is no current trading market for Tribune Publishing common stock, although we expect that a limited market, commonly known as a “when-issued” trading market, will develop prior to the distribution. We expect “regular-way” trading of Tribune Publishing common stock to begin on the first trading day following the completion of the distribution. Tribune Publishing has applied to have its common stock authorized for listing on the New York Stock Exchange under the symbol “TPUB”.
No vote of stockholders or warrantholders is required in connection with the distribution. We are not asking for a proxy and you are requested not to send a proxy.
Holding and disposing of shares of Tribune Publishing common stock involves risks that are described in the “ Risk Factors ” section of this information statement.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this information statement is truthful or complete. Any representation to the contrary is a criminal offense.
This information statement is not an offer to sell or the solicitation of an offer to buy any securities.
The date of this information statement is         , 2014.

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 TABLE OF CONTENTS

 	 	Page	 	
		
INFORMATION STATEMENT SUMMARY	 	 	1	  	
		
SUMMARY HISTORICAL AND PRO FORMA COMBINED FINANCIAL DATA	 	 	12	  	
		
RISK FACTORS	 	 	15	  	
		
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS	 	 	35	  	
		
THE DISTRIBUTION	 	 	36	  	
		
RELATIONSHIPS BETWEEN TRIBUNE AND TRIBUNE PUBLISHING FOLLOWING THE DISTRIBUTION	 	 	46	  	
		
FINANCING ARRANGEMENTS	 	 	53	  	
		
DIVIDEND POLICY	 	 	55	  	
		
CAPITALIZATION	 	 	56	  	
		
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS	 	 	57	  	
		
SELECTED HISTORICAL COMBINED FINANCIAL DATA	 	 	66	  	
		
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	 	 	67	  	
		
BUSINESS	 	 	96	  	
		
MANAGEMENT	 	 	109	  	
		
EXECUTIVE COMPENSATION	 	 	115	  	
		
DIRECTOR COMPENSATION	 	 	124	  	
		
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT	 	 	125	  	
		
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	 	 	127	  	
		
DESCRIPTION OF CAPITAL STOCK	 	 	129	  	
		
WHERE YOU CAN FIND MORE INFORMATION	 	 	134	  	
		
INDEX TO FINANCIAL STATEMENTS	 	 	F-1	  	

Table of Contents
 INFORMATION STATEMENT SUMMARY
This summary highlights selected information contained elsewhere in this information statement. This summary may not contain all of the information that is important to you. To better understand the distribution and Tribune Publishing, you should carefully read this entire information statement, including the risks described in “Risk Factors” and the combined financial statements and the notes thereto beginning on page F-1.
We describe in this information statement the business to be transferred to Tribune Publishing in the distribution as if the transferred business were Tribune Publishing’s business for all historical periods described. References in this information statement to Tribune Publishing’s historical assets, liabilities, business or activities of its business are generally intended to refer to the historical assets, liabilities, business or activities of the transferred business as the business was conducted as part of Tribune and its subsidiaries prior to the distribution.
When we refer to stockholders of Tribune or to common stock of Tribune we are referring to holders of both Class A and Class B common stock of Tribune and both Class A and Class B common stock, respectively, unless the context otherwise requires. Holders of warrants to purchase Tribune common stock (the “Warrants”) pursuant to the Warrant Agreement, dated as of December 31, 2012, are entitled to receive a pro rata distribution concurrently with the holders of Tribune common stock.
Unless otherwise indicated, all information herein gives effect to amendments to our certificate of incorporation and by-laws to be adopted prior to the completion of the distribution. As used herein, “we,” “us,” and “our” refer to Tribune Publishing and its combined subsidiaries after giving effect to the distribution, unless the context otherwise requires.
Why Tribune Sent This Document to You
Tribune sent this document to you because you were a holder of Tribune Class A or Class B common stock or Warrants on the record date for the distribution of shares of Tribune Publishing common stock. In the distribution, holders of Tribune Class A common stock, Class B common stock and Warrants will receive 0.25 of a share of Tribune Publishing common stock for every share of Tribune common stock or Warrant, as applicable, owned on the record date for the distribution. No fractional shares of Tribune Publishing common stock will be issued. If you would be entitled to a fractional share of Tribune Publishing common stock, then you will receive cash for the market value thereof.
No action is required on your part to participate in the distribution, and you do not have to surrender or exchange your shares of Tribune stock or Warrants or pay cash or any other consideration to receive the shares of Tribune Publishing common stock. The number of shares of Tribune common stock or Warrants that you currently own will not change as a result of the distribution.
This information statement describes the business of Tribune Publishing, Tribune Publishing’s relationship with Tribune and how this transaction affects Tribune, its stockholders and its warrantholders, and provides other information to assist you in evaluating the benefits and risks of holding or disposing of the Tribune Publishing common stock that you will receive in the distribution.
Tribune Publishing’s Business
Company Overview
Tribune Publishing is a leading newspaper publishing and local news and information gathering company that operates daily newspapers and related websites in eight major markets as well as a number of

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ancillary businesses that leverage certain of the assets of those businesses. Our core publications have served their respective communities with local, regional, national and international news and information for an average of more than 150 years. We operate over 60 affiliated websites and mobile applications, including a primary online product for each local newspaper, which is an expanded version of the newspaper, providing local, national and international news along with feature reporting.
The eight principal daily newspapers that we publish are the Los Angeles Times , the Chicago Tribune , the Sun Sentinel, serving southeast Florida, the Orlando Sentinel , The Baltimore Sun , the Hartford Courant , The Morning Call , serving Pennsylvania’s Lehigh Valley, and the Daily Press , serving the Virginia Peninsula. Collectively, Tribune is the second-largest newspaper publisher in the country, based on Sunday print circulation.
Our three primary revenue streams are advertising and marketing services, circulation and third party printing and distribution.
Our advertising and marketing services are delivered to customers through three main channels: run-of-press (“ROP”), preprint and digital. ROP advertisement is comprised of advertisements that are printed in the newspapers while preprint advertising primarily consists of glossy, color inserts that are included with the newspapers. Digital advertising is primarily related to advertising revenue sold on our owned and operated newspaper websites.
Competitive Strengths
We believe our competitive strengths include the following:
Large footprint in attractive and diverse markets
We are the second largest newspaper group in the United States, based on Sunday print circulation. Our publications serve eight of the top 70 markets, including two of the top three, in the United States by population, positioning us as a leading local media provider with a national footprint and access to prominent national advertisers. We believe that the long-standing presence of several of our publications in their respective markets makes these newspapers and their associated websites sought-after news and information sources as well as attractive advertising platforms.
Diverse revenue sources
Our revenue is primarily derived from advertising, circulation and commercial services, including printing and delivery of third-party publications. In 2013, 59% of our operating revenues were derived from advertising, as compared to 61% and 65% in 2012 and 2011, respectively. Faced with a challenging macroeconomic environment and a decline of traditional ROP advertising due to, among other things, the expansion of digital alternatives and structural changes in advertisers’ marketing mix, we have diversified our revenue by focusing on non-ROP opportunities in digital, circulation, commercial print and delivery, and direct mail.
Integrated digital strategy enables enhanced monetization through digital advertising and subscription paywalls
We believe we have high quality, user-friendly branded websites for each of our newspapers, and we strive to cultivate and develop new products and services to improve the online experience for our digital readers and provide compelling online, interactive advertising opportunities for our clients. We have also monetized our digital subscriber base through the implementation of various forms of “paywalls” on our newspaper-affiliated websites.

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Exceptional content driven by award-winning journalism and columnists
With an average publishing history of over 150 years, we believe each of our eight principal daily newspapers is integral to the cultural fabric of its community, a trusted source of local and national news and information, and an influential and prominent local voice. In recognition of their journalistic excellence, our publications have amassed 88 Pulitzer Prizes, including 27 since the year 2000, and many other prestigious editorial accolades.
Long-standing advertising relationships
Over the last several years, we have worked to upgrade our sales team talent and realign incentives while investing in research, data and analytics to create a highly-skilled, motivated and effective sales organization. We provide advertisers the opportunity to reach millions of consumers in several key markets through the use of targeted media. We have longstanding relationships with many of our customers and our sales organization has frequent, direct contact with key decision-makers within these organizations.
Efficient content sharing across the Tribune Publishing portfolio
Our editorial platform allows for sharing of content throughout the organization. We have created Media On Demand (“MoD”), a content-sharing program to enable fast, efficient use of content created by the Los Angeles Times , the Chicago Tribune and other sources. Each day the MoD team creates and edits shared stories, photo galleries, videos, content collections and landing pages for non-local content.
Robust print and distribution infrastructure with significant third-party relationships
We maintain an extensive network of printing plants and insertion facilities that is utilized to produce and disseminate our publications as well as pursue commercial services revenue from third parties. Annually, we deliver more than one billion copies of over 150 different publications and 10 billion preprints.
Efficient cost structure and centralized support functions
Over the past three years, we have rationalized our organizational structure and expense base to drive increased profitability. We believe we have successfully leveraged our economies of scale to reduce supply chain costs, consolidate shared services, provide significant shared editorial content, replicate best practices and streamline management. In connection with the distribution, we will need to dedicate sufficient resources to replicate certain technology applications and hardware, infrastructure and personnel to which we will no longer have access after the distribution from Tribune. We currently estimate that we will expend approximately $             in order to replicate such technology and infrastructure, which we expect to fund through cash from operating activities and, if necessary, proceeds from borrowings under our Senior Credit Facilities (as defined below).
Leadership in Hispanic and niche demographics
With the growing demographic significance of Hispanic communities in the United States, especially in a number of our key markets, we are well positioned to reach these communities. With media groups in Los Angeles, Chicago and South Florida, we have direct access to three of the six largest Hispanic designated market areas (“DMAs”) in the United States. The Hispanic population in these markets exceeds 12 million and is expected to continue to grow. In addition, the continued expansion of niche magazines and websites offers a compelling opportunity to reach new sources of local advertising.

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Strategies
We are committed to the creation and monetization of content of the highest quality and integrity, in both print and digital formats and in response to the evolving preferences of both consumers and advertisers. Our goal is to produce improved earnings and cash flow, creating incremental value for shareholders over the long-term. We intend to achieve these objectives by executing the following strategies:
Strengthen franchises by continuously improving digital platforms
We are focused on growing our digital media platform. In addition to the branded websites of our newspapers, we are developing new products and services to improve the online and mobile experience for digital readers and enhance compelling online, interactive advertising and marketing communication opportunities for customers. With more than 42 million monthly unique visitors, digital advertising revenue accounted for approximately 18% of total advertising revenue in fiscal 2013.
Monetize content through digital paywalls and subscription pricing strategies
Since 2011, we have implemented “paywalls” on our newspaper-affiliated websites. Daily digital circulation (replica and non-replica combined) grew by approximately 51% for the six months ended March 30, 2014, which is the most recently audited circulation period, versus the prior year period while Sunday digital circulation grew by approximately 45% over the same time period. In addition, we have implemented targeted price increases which helped grow print circulation revenue by approximately 2% in 2013 (compared on a 52-week basis) despite a decline in the number of newspapers circulated.
Create an integrated, next-generation marketing and advertising sales effort
We aim to continuously upgrade sales team talent, realign incentives and invest in research, data and analytics to create a highly-skilled, motivated and effective sales organization. We seek to achieve accountability and transparency throughout the sales organization and motivate the team while creating opportunities to monetize content. Additionally, through our proprietary solutions and third-party technologies, we offer a full line of digital marketing services products that advertisers can use to reach and interact with local consumers.
Supplement organic growth with selective acquisitions
We believe the operational transformation we have undertaken positions us as a flexible and scalable platform for strategic acquisitions and enables us to more efficiently and profitably grow and diversify our revenue streams. We believe our centralization efforts put us in an ideal position to explore strategic acquisitions to enhance our business, including in areas where we can expand our audience, broaden our relationships with customers and readers and offer new products. To preserve the tax-free status of the distribution, however, the tax matters agreement provides for certain restrictions on Tribune Publishing’s ability to pursue strategic or other transactions. See “Risk Factors—Risks Relating to the Distribution—We will be unable to take certain actions after the distribution because such actions could jeopardize the tax-free status of the distribution, and such restrictions could be significant.”
Continue to strategically manage our core business
In recent years, we have grown circulation revenue in the face of industry declines in volume by implementing successful circulation pricing tactics and have rationalized our cost structure in order to drive increased profitability. We have leveraged our economies of scale to reduce supply chain costs, consolidate shared services, provide significant shared editorial content, replicate best practices and streamline management. At the same time, management has continued to invest in infrastructure, technology, business intelligence and content development in support of the ongoing digital transformation. We expect to continue these efforts in order to continue to decrease costs and drive profitability.

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Maintain a flexible balance sheet
Following the distribution, we expect to have approximately $350 million of indebtedness outstanding under our expected Senior Term Loan Facility (as defined below), in addition to our expected Senior ABL Facility (as defined below) with aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million and a cash backed letter of credit of approximately $25 million issued on our behalf. We also expect to have approximately $25 million of additional letters of credit issued under the Senior ABL Facility as of the distribution date, for a total of approximately $50 million of letters of credit. The Senior ABL Facility is expected to include flexibility for additional letters of credit to be issued thereunder. See “Financing Arrangements.” Through proactive cost management, prudent capital expenditures and conservative financial policies, we will seek to maintain financial flexibility to successfully execute our business strategies.
The Distribution
Internal Reorganization
The separation and distribution agreement between Tribune and Tribune Publishing will provide for the transfers of entities and related assets and liabilities so that as of the distribution Tribune will retain the entities associated with Tribune’s broadcasting business and Tribune Publishing will hold the entities associated with the publishing business, including the Los Angeles Times , the Chicago Tribune , the Sun Sentinel, serving southeast Florida, the Orlando Sentinel , The Baltimore Sun , the Hartford Courant , The Morning Call, serving Pennsylvania’s Lehigh Valley, and the Daily Press , serving the Virginia Peninsula. We are currently a wholly-owned subsidiary of Tribune. In connection with the distribution, Tribune will undertake a series of internal reorganization transactions to facilitate the transfers of entities and the related assets and liabilities. See “The Distribution—Internal Reorganization” for further discussion.
Following the distribution, Tribune will continue to own Tribune’s broadcasting and other businesses, including its equity interests in Classified Ventures, CareerBuilder and the Television Food Network, and its portfolio of real estate assets. Tribune is also expected to retain most of its pension assets and liabilities. We may experience increased costs following the distribution or be unable to operate profitably after becoming a stand-alone company. See “Risk Factors—Risks Relating to the Distribution.”
We are in discussions with potential lenders regarding debt financing, and we currently expect such debt financing to consist of a senior secured term loan facility in an aggregate principal amount of approximately $350 million (the “Senior Term Loan Facility”), a senior secured asset-based revolving credit facility with aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million (the “Senior ABL Facility”, and, together with the Senior Term Loan Facility, the “Senior Credit Facilities”) and, in addition, an arrangement to allow cash backed letters of credit, with approximately $25 million issued on our behalf. We also expect to have approximately $25 million of additional letters of credit issued under the Senior ABL Facility as of the distribution date, for a total of approximately $50 million of letters of credit. The Senior ABL Facility is expected to include flexibility for additional letters of credit to be issued thereunder. We expect the Senior ABL Facility will be undrawn at the time of the distribution. See “Financing Arrangements.” Immediately prior to the distribution, we intend to pay a cash dividend to Tribune of up to $275 million. We expect to fund such cash dividend with a portion of the proceeds from the Senior Term Loan Facility.
Reasons for the Distribution
The board of directors of Tribune determined that separating Tribune Publishing’s publishing businesses from Tribune’s broadcasting and other businesses is in the best interests of Tribune and Tribune’s stockholders. Following the separation, Tribune and Tribune Publishing would each have greater financial and operational

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focus, the ability to tailor its capital structure to its specific business needs and a management team dedicated to seizing strategic growth opportunities with maximum flexibility. The separation is designed to maximize shareholder value through the spin-off of Tribune’s publishing assets to an independent company and the tax-free distribution of shares in that company to the stockholders and warrantholders of Tribune.
The Tribune board of directors considered the following potential benefits in determining to effect the distribution:
 
 	—  	 	allowing each of Tribune and Tribune Publishing to focus on its respective core business;	
 
 	—  	 	relieving certain regulatory restrictions on the ability of either Tribune or Tribune Publishing to enter into certain markets as a result of current cross-ownership restrictions;	
 
 	—  	 	enhancing the effectiveness of Tribune and Tribune Publishing’s equity-linked compensation;	
 
 	—  	 	facilitating future acquisitions and creating more attractive acquisition currencies for both Tribune and Tribune Publishing;	
 
 	—  	 	optimizing the capital structure and leverage level for the distinctive business profile of each of Tribune and Tribune Publishing; and	
 
 	—  	 	facilitating a potential future public offering of Tribune.	
Conditions
The distribution is subject to a number of conditions, including:
 
 	—  	 	the approval by the board of directors of Tribune of the distribution and all related transactions (and such approval not having been withdrawn);	
 
 	—  	 	Tribune’s receipt of an opinion of its special tax counsel in a form satisfactory to Tribune and the private letter ruling from the IRS shall not have been revoked or materially amended;	
 
 	—  	 	no pending, threatened or issued order, injunction or decree by any governmental entity of competent jurisdiction or other legal restraint that would prevent the consummation of the distribution;	
 
 	—  	 	no events or developments having occurred prior to the distribution that, in the judgment of the board of directors of Tribune, would result in the distribution having a material adverse effect on Tribune or its stockholders;	
 
 	—  	 	Tribune’s and Tribune Publishing’s execution of the separation and distribution agreement and all other ancillary agreements relating to the distribution; and	
 
 	—  	 	Tribune Publishing’s common stock having been approved for listing on a national securities exchange.	
We cannot assure you that any or all of the conditions will be satisfied or waived. See “The Distribution—Conditions to the Distribution” for additional details.
Regulatory Approval
Apart from the registration under United States federal securities laws of the shares of the Tribune Publishing common stock that will be distributed in the distribution and related stock exchange listing requirements, we do not believe that other material governmental or regulatory filings or approvals will be

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necessary to consummate the distribution. The distribution will not affect the ownership or control of Tribune’s television stations or its television licensee subsidiaries; consequently, Federal Communications Commission (“FCC”) approval will not be required in connection with the distribution with respect to any of the television station licenses. FCC consent will be required with respect to the transfer to Tribune Publishing of certain private business radio licenses associated with newspaper operations.
No Appraisal Rights
Tribune stockholders will not have appraisal rights in connection with the distribution.
Risks Associated with Our Business and the Distribution
You should carefully consider the matters discussed under the heading “Risk Factors” of this information statement.
Trademarks and Copyrights
We own or have rights to various trademarks, logos, service marks and trade names that we use in connection with the operation of our business. Solely for convenience, the trademarks, service marks, trade names and copyrights referred to in this information statement are listed without the ™, ® and © symbols, but such references do not constitute a waiver of any rights that might be associated with the respective trademarks, service marks, trade names and copyrights included or referred to in this information statement.
Market and Industry Data
The market and industry data contained in this information statement, including trends in our markets and our position within such markets, are based on a variety of sources, including our good faith estimates, which are derived from our review of internal surveys, information obtained from customers and subscribers and publicly available information, as well as from independent industry publications, reports by market research firms and other published independent sources. Although we believe these sources are reliable, we have not independently verified the information. None of the independent industry publications used in this information statement were prepared on our or Tribune’s behalf.
Corporate Information
Tribune Publishing Company was incorporated on November 21, 2013. Our principal executive offices are located at 435 North Michigan Avenue, Chicago, Illinois 60611, and our telephone number is 312-222-9100. Our corporate website is located at www.tribunepublishingco.com. The information contained in, or that can be accessed through, our website is not part of this information statement.
Questions and Answers about Tribune Publishing and the Distribution
 
What will I receive as a result of the distribution?	Holders of Tribune Class A common stock, Class B common stock and Warrants will receive 0.25 of a share of Tribune Publishing common stock for every share of Tribune common stock or Warrant, as applicable, owned at 5:00 p.m., New York time, on         , 2014, the record date for the distribution. No fractional shares of Tribune Publishing common stock will be issued. If you would be entitled to a fractional share of Tribune Publishing common stock, then you will receive cash for the market value thereof.	

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What will happen in the distribution?	Tribune will transfer to Tribune Publishing all of its assets, liabilities and businesses primarily related to Tribune’s publishing operations (which we refer to collectively as the contribution) other than owned real estate. In exchange for the contribution, Tribune Publishing will:	
 
 	—  	 	issue to Tribune approximately                  shares of Tribune Publishing common stock to be distributed to Tribune’s stockholders on a pro rata basis, which we refer to as the distribution; and	
 
 	—  	 	transfer to Tribune cash from a portion of the proceeds of borrowings under the Senior Term Loan Facility we anticipate arranging prior to the distribution. See “Financing Arrangements.”	
 
 	After the contribution, Tribune will spin off Tribune Publishing to the stockholders of Tribune by distributing 98.5% of the shares of Tribune Publishing common stock to Tribune stockholders and holders of Warrants on a pro rata basis.	
 
 	As a result of the distribution, Tribune Publishing will become an independent public company, although Tribune Publishing will continue to have a number of significant commercial arrangements with Tribune. Tribune will continue to hold a 1.5% stake in Tribune Publishing to allow Tribune Publishing to enter into a modified affiliation agreement with CareerBuilder, LLC. See “Business—Customers and Contracts.”	
 
 	We have applied to list Tribune Publishing common stock on the New York Stock Exchange under the symbol “TPUB”.	
 
What are holders of Warrants entitled to receive in the distribution?	Pursuant to the Warrant Agreement, dated as of December 31, 2012 (the “Warrant Agreement”), between Tribune, Computershare Inc. and Computershare Trust Company, N.A., holders of Warrants are entitled to receive a pro rata distribution concurrently with the distribution of Tribune Publishing common stock made to holders of common stock of Tribune. Accordingly, holders of Warrants will receive 0.25 of a share of Tribune Publishing common stock for every Warrant owned on the record date for the distribution. After the distribution, the Warrants will remain outstanding with the same terms and conditions.	
 
When will the distribution occur?	Tribune currently anticipates completing the distribution on or about         , 2014.	
 
What is the record date for the distribution?	The record date is         , 2014, and ownership of Tribune common stock was determined as of 5:00 p.m., Eastern Time, on that date. When we refer to the “record date,” we are referring to that date and time.	
 
Is stockholder approval required for the distribution?	Stockholder approval is not required for the distribution. The distribution of Tribune Publishing will be accomplished by distributing the shares of Tribune Publishing common stock to holders of Tribune common stock and Warrants as a dividend. Accordingly, the dividend of the shares of Tribune Publishing common stock will be approved by the Tribune board of directors pursuant to its statutory authority under Delaware law to declare and pay dividends.	

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What do I have to do to receive my shares of Tribune Publishing common stock?	Nothing. Your shares of Tribune Publishing common stock will be either reflected in an account statement that our transfer agent, Computershare Investor Services, will send to you shortly after         , 2014 or credited to your account with your broker or nominee on or about         , 2014.	
 
When will I receive my shares of Tribune Publishing common stock?	If you hold your Tribune shares or Warrants in your own name, then your account statement reflecting the Tribune Publishing shares will be mailed to you on or about         , 2014. You should allow several days for the mail to reach you.	
 
 	If you hold your Tribune shares or Warrants through your broker or other nominee, you are probably not a stockholder of record and your receipt of Tribune Publishing shares depends on your arrangements with the nominee that holds your Tribune shares or Warrants for you. Tribune anticipates that brokers and other nominees generally will credit their customers’ accounts with Tribune Publishing shares on or about         , 2014, but you should check with your broker or other nominee. See “The Distribution—When and How You Will Receive Tribune Publishing Common Stock.”	
 
How will shares of Tribune Publishing common stock be distributed to me?	Tribune will distribute the shares of Tribune Publishing common stock by book-entry. If you are a record holder of Tribune common stock or Warrants on the record date then you will receive from our transfer agent shortly after         , 2014, a statement of your book-entry account for the shares of Tribune Publishing common stock that are distributed to you. You will not receive physical stock certificates for your shares of Tribune Publishing common stock. If you are not a record holder of Tribune common stock or Warrants on the record date because your shares are held on your behalf by your broker or other nominee, then your shares of Tribune Publishing common stock should be credited to your account with your broker or nominee on or about         , 2014.	
 
Will Tribune distribute fractional shares?	Fractional shares of Tribune Publishing common stock will not be issued in the distribution. If you would be entitled to receive a fractional share of Tribune Publishing common stock in the distribution, then you will instead receive a cash payment with respect to the fractional shares. See “The Distribution—Treatment of Fractional Shares.”	
 
Will the distribution affect the market price of my Tribune shares?	Following the distribution, we expect that Tribune common stock will continue to be traded over-the-counter. As a result of the distribution, the trading price of Tribune shares immediately following the distribution may be lower than immediately prior to the distribution. Until the market has fully evaluated the operations of Tribune without Tribune Publishing’s business and potentially thereafter, the price of Tribune shares may fluctuate significantly. See “The Distribution—Listing and Trading of the Shares of Tribune Publishing Common Stock.”	
 
Where will my shares of Tribune Publishing common stock be traded?	We have applied to list the shares of Tribune Publishing common stock on the New York Stock Exchange under the trading symbol “TPUB” following completion of the distribution. See “The Distribution—Listing and Trading of the Shares of Tribune Publishing Common Stock.”	

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When will I be able to trade shares of Tribune Publishing common stock?	There is no current trading market for Tribune Publishing common stock, although we expect that a limited market, commonly known as a “when-issued” trading market, will develop prior to the distribution date. We expect “regular-way” trading of Tribune Publishing common stock to begin on the first trading day following the completion of the distribution. As discussed under “The Distribution—Listing and Trading of the Shares of Tribune Publishing Common Stock,” if you sell your Tribune Class A common stock or Class B common stock or Warrants after the record date and before the distribution, you will still be entitled to receive shares of Tribune Publishing’s common stock in the distribution.	
 
What is Tribune Publishing’s dividend policy?	Following the distribution, we expect to pay regular cash dividends, although the timing, declaration, amount and payment of future dividends to stockholders will fall within the discretion of our Board of Directors. We cannot provide any assurance that dividends will be declared or paid. See “Dividend Policy.”	
 
Can Tribune decide to cancel the distribution even if all of the conditions have been satisfied?	Yes. Until the distribution has occurred, Tribune has the right to terminate the distribution, even if all the conditions have been satisfied, if the board of directors of Tribune determines that the distribution is not in the best interest of Tribune and its stockholders or that market conditions or other circumstances are such that the separation of Tribune Publishing and Tribune is no longer advisable at that time.	
 
What are the United States federal income tax consequences of the distribution to me as a Tribune stockholder?	To implement the distribution, Tribune will distribute the shares of Tribune Publishing common stock on a pro rata basis to Tribune’s stockholders and warrantholders in a manner that is intended to be tax-free to its stockholders and warrantholders for U.S. federal income tax purposes, except for cash that stockholders and warrantholders receive in lieu of fractional shares. See “The Distribution—Material U.S. Federal Income Tax Consequences of the Distribution.”	
 
How will Tribune Publishing be managed?	At the time of the distribution, Tribune Publishing’s executive officers are expected to be John H. Griffin, Jr., President and Chief Executive Officer; John B. Bode, Chief Financial Officer; Howard Greenberg, Publisher and Chief Executive Officer, Orlando Sentinel and Sun-Sentinel ; Tony Hunter, Publisher and Chief Executive Officer, Chicago Tribune Company; Timothy E. Ryan, Publisher and Chief Executive Officer, The Baltimore Sun and The Morning Call ; and Julie K. Xanders, General Counsel. At the time of the distribution, Tribune Publishing’s Board of Directors will consist of six directors, each with one-year terms. Tribune Publishing’s directors are expected to be David E. Dibble, Philip G. Franklin, John H. Griffin, Jr., Eddy W. Hartenstein, Renetta McCann and Ellen Taus. See “Management.”	
 
What kind of relationship will Tribune Publishing have with Tribune after the distribution?	Prior to the distribution, Tribune Publishing and Tribune will enter into agreements for Tribune to transfer to Tribune Publishing certain assets and liabilities of Tribune related to Tribune Publishing’s business, to arrange for the continued provision of certain services by each company to the other for a period of time, to make arrangements for the distribution and to define the	

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 	ongoing relationships between Tribune and Tribune Publishing, including with respect to tax matters. See “Relationships Between Tribune and Tribune Publishing following the Distribution.”	
 
What are Tribune Publishing’s financing arrangements?	Immediately prior to the distribution, we intend to pay a cash dividend to Tribune of up to $275 million. We expect to fund such cash dividend with a portion of the proceeds from the approximately $350 million Senior Term Loan Facility that we anticipate arranging prior to the distribution. In addition, prior to the distribution, we expect to enter into the Senior ABL Facility with aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million and to enter into an arrangement to allow cash backed letters of credit, with approximately $25 million issued on our behalf. We also expect to have approximately $25 million of additional letters of credit issued under the Senior ABL Facility as of the distribution date, for a total of approximately $50 million of letters of credit. The Senior ABL Facility is expected to include flexibility for additional letters of credit to be issued thereunder. We expect the Senior ABL Facility will be undrawn at the time of the distribution. See “Financing Arrangements.”	
 
Will any anti-takeover protections exist following the distribution?	Certain provisions of Tribune Publishing’s amended and restated certificate of incorporation and amended and restated by-laws may have the effect of making the acquisition of control of the company in a transaction not approved by our board of directors more difficult. See “Description of Capital Stock—Anti-Takeover Effects of Various Provisions of Delaware Law, Our Amended and Restated Certificate of Incorporation and Amended and Restated By-laws.”	
 
Do I have appraisal rights in connection with the distribution?	No. Holders of Tribune common stock and Warrants have no appraisal rights in connection with the distribution. See “The Distribution—No Appraisal Rights.”	
 
Who is the transfer agent and registrar for Tribune Publishing common stock?	The transfer agent and registrar for Tribune Publishing common stock is Computershare Investor Services. You can contact the transfer agent and registrar at the following address and telephone number:	
Computershare Investor Services
P.O. Box 30170
College Station, TX 77842-3170
(888) 359-8621
 
 	Please contact the transfer agent with any questions about the distribution or if you need any additional information.	

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 SUMMARY HISTORICAL AND PRO FORMA COMBINED FINANCIAL DATA
Set forth below are summary historical and pro forma combined financial data for Tribune Publishing for the three months ended Mar. 30, 2014 and Mar. 31, 2013, as of and for Dec. 31, 2012 and for each of the three years ended Dec. 29, 2013, Dec. 30, 2012 and Dec. 25, 2011. The pro forma combined operating and balance sheet data as of and for the three months ended Mar. 30, 2014 and the pro forma combined operating data for the year ended Dec. 29, 2013 were derived from Tribune Publishing’s combined financial statements included elsewhere in this information statement. The historical combined operating data for the three months ended Mar. 30, 2014 and Mar. 31, 2013, for Dec. 31, 2012 and for the years ended Dec. 29, 2013, Dec. 30, 2012 and Dec. 25, 2011 and the historical combined balance sheet data as of Mar. 30, 2014, Dec. 29, 2013, Dec. 31, 2012 and Dec. 30, 2012 were derived from Tribune Publishing’s combined financial statements included elsewhere in this information statement. The historical combined balance sheet data as of Mar. 31, 2013 and Dec. 25, 2011 were derived from the financial records of Tribune, which are not included in this information statement. Operating results for any prior period are not necessarily indicative of the operating results to be expected in any future period, and operating results for the 2014 interim period are not necessarily indicative of the operating results that Tribune Publishing will experience for the entire year.
The unaudited pro forma combined financial data presented below are not necessarily indicative of Tribune Publishing’s results of operations or financial condition had the spin-off and related transactions been completed on the dates assumed. The unaudited pro forma combined financial data also may not be representative of the results of operations or financial condition that would have resulted had Tribune Publishing been operated as an independent, publicly-traded company during such periods and should not be relied upon as a representation of our future performance.
The summary historical and pro forma combined financial data set forth below should be read in conjunction with “Unaudited Pro Forma Combined Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the historical combined financial statements and the notes thereto included in this information statement. The summary historical and pro forma combined financial data reflect Tribune Publishing’s results as historically operated as a part of Tribune, and these results may not be indicative of our future performance as a stand-alone company following the distribution. Operating expenses reflect direct expenses and allocations of certain Tribune corporate expenses that have been charged to Tribune Publishing based on specific identification or allocated based on use or other methodologies we believe appropriate. Management believes these allocations have been made on a reasonable and appropriate basis under the circumstances.

 	 	Successor	 	 	  	 	Predecessor	 	
 	 	As of and for the
three months ended	 	 	As of and for the year ended	 	 	  	 	As of and
for	 	 	As of and for the
years ended	 	
 	 	Pro Forma
Mar. 30,
2014	 	 	Mar. 30,
2014	 	 	Mar. 31,
2013	 	 	Pro Forma
Dec. 29,
2013	 	 	Dec. 29,
2013	 	 	  	 	Dec. 31,
2012 1	 	 	Dec. 30,
2012 2	 	 	Dec. 25,
2011	 	
(in thousands)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	
						 				
STATEMENT OF OPERATIONS DATA:	 				 				 				 				 				 	 	 				 				 				
Operating Revenues	 	$	        	  	 	$	416,522	  	 	$	440,513	  	 	$	        	  	 	$	    1,795,107	  	 	 	 	$	—	  	 	$	    1,913,814	  	 	$	    1,915,932	  	
Operating Profit	 	$	        	  	 	$	20,771	  	 	$	37,653	  	 	$	        	  	 	$	166,529	  	 	 	 	$	—	  	 	$	41,656	  	 	$	44,569	  	
Net Income	 	$	        	  	 	$	11,772	  	 	$	21,193	  	 	$	        	  	 	$	94,094	  	 	 	 	$	    2,842,326	  	 	$	28,395	  	 	$	41,614	  	
Net Income Per Share:	 				 				 				 				 				 	 	 				 				 				
Basic	 	$	        	  	 	$	N/A	  	 	$	N/A	  	 	$	        	  	 	 	N/A	  	 	 	 	 	N/A	  	 	 	N/A	  	 	 	N/A	  	
Diluted	 	$	        	  	 	$	N/A	  	 	$	N/A	  	 	$	        	  	 	 	N/A	  	 	 	 	 	N/A	  	 	 	N/A	  	 	 	N/A	  	
						 				
BALANCE SHEET DATA:	 				 				 				 				 				 	 	 				 				 				
Total Assets	 	$	        	  	 	$	464,145	  	 	$	843,317	  	 	$	        	  	 	$	514,366	  	 	 	 	$	897,797	  	 	$	951,232	  	 	$	1,043,785	  	
Total Non-Current Liabilities	 	$	        	  	 	$	59,767	  	 	$	59,660	  	 	$	        	  	 	$	61,061	  	 	 	 	$	61,787	  	 	$	66,300	  	 	$	79,728	  	

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 	 	For the three
months ended	 	 	For the years ended	 	
(in thousands)	 	Mar. 30,
2014	 	  	Mar. 31,
2013	 	 	Dec. 29,
2013	 	 	Dec. 30,
2012	 	 	Dec. 25,
2011	 	
OTHER FINANCIAL DATA:	 				  				 				 				 				
Adjusted EBITDA(3)	 	$	    40,245	  	  	$	    44,529	  	 	$	    234,719	  	 	$	    230,750	  	 	$	    206,867	  	

(1)  	Operating results for Dec. 31, 2012 include only (i) reorganization adjustments which resulted in a net gain of $2.862 billion before taxes ($2.894 billion after taxes) and (ii) fresh-start reporting adjustments which resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). See Note 3 to the audited combined financial statements for further information.	
 
(2)	The year ended Dec. 30, 2012 consisted of 53 weeks, whereas all other fiscal years presented consisted of 52 weeks. The additional week contributed approximately $32 million to operating revenues for the year ended Dec. 30, 2012.	
 
(3)	Adjusted EBITDA	
Adjusted EBITDA is defined as net income before income taxes, interest income, interest expense, depreciation and amortization, equity income and losses, pension expense, stock-based compensation, certain unusual and non-recurring items (including severance and transaction-related costs), write-down of investments, non-operating items and reorganization items. Our management uses Adjusted EBITDA (a) as a measure of operating performance; (b) for planning and forecasting in future periods; and (c) in communications with our Board of Directors concerning our financial performance. Adjusted EBITDA is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States of America (GAAP). This non-GAAP measure is presented because it is used by management to evaluate our operating performance. We believe the presentation of Adjusted EBITDA enhances investors’ overall understanding of the financial performance of our business as a stand-alone company. In addition, Adjusted EBITDA, or a similarly calculated measure, is expected to be used as the basis for certain financial maintenance covenants that we will be subject to in connection with our entry into the Senior Credit Facilities. We believe Adjusted EBITDA is helpful in highlighting operating trends because it excludes the results of decisions that are outside the control of management and that can differ significantly from company to company depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate, age and book depreciation of facilities and capital investments. Since not all companies use identical calculations, our presentation of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies and should not be used by investors as a substitute or alternative to net income or any measure of financial performance calculated and presented in accordance with GAAP. Instead, we believe Adjusted EBITDA should be used to supplement our financial measures derived in accordance with GAAP to provide a more complete understanding of the trends affecting the business.
We note that Adjusted EBITDA does not reflect the potential impact resulting from the distribution and Tribune Publishing operating as a stand-alone public company, including any modification to the affiliation agreement between CareerBuilder and Tribune as a result of the distribution, the impact of affiliation agreements between Classified Ventures and our newspapers that may not be renewed or may be renewed on different terms or rental expense to be incurred by Tribune Publishing related to lease agreements with Tribune for certain facilities and office space. See “Unaudited Pro Forma Combined Financial Statements” and the notes thereto.
Although Adjusted EBITDA is frequently used by investors and securities analysts in their evaluations of companies, Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for, or more meaningful than, amounts determined in accordance with GAAP. Some of the limitations to using non-GAAP measures as an analytical tool are:
 
 	—  	 	they do not reflect our interest income and expense, or the requirements necessary to service interest or principal payments on our debt;	
 
 	—  	 	they do not reflect future requirements for capital expenditures or contractual commitments; and	
 
 	—  	 	although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and non-GAAP measures do not reflect any cash requirements for such replacements.	

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The following table presents a reconciliation of net income, the most directly comparable measure under GAAP, to Adjusted EBITDA for the periods presented:

 	 	For the three months ended	 	 	For the years ended	 	
(in thousands)	 	Mar. 30,
2014	 	 	Mar. 31,
2013	 	 	Dec. 29,
2013	 	 	Dec. 30,
2012	 	 	Dec. 25,
2011	 	
Net income	 	$	    11,772	  	 	$	    21,193	  	 	$	    94,094	  	 	$	    28,395	  	 	$	    41,614	  	
Income tax expense	 	 	8,653	  	 	 	16,180	  	 	 	70,992	  	 	 	3,294	  	 	 	2,539	  	
Reorganization items, net	 	 	9	  	 	 	(58	) 	 	 	270	  	 	 	1,446	  	 	 	(410	) 	
Other non-operating loss	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	1	  	
Write-down of investment	 	 	—	  	 	 	—	  	 	 	—	  	 	 	6,141	  	 	 	—	  	
Interest expense (income), net	 	 	2	  	 	 	(13	) 	 	 	(14	) 	 	 	31	  	 	 	(75	) 	
Loss on equity investments, net	 	 	335	  	 	 	351	  	 	 	1,187	  	 	 	2,349	  	 	 	900	  	
Depreciation and amortization	 	 	4,346	  	 	 	6,960	  	 	 	28,431	  	 	 	86,662	  	 	 	86,345	  	
Allocated depreciation from Tribune(A)	 	 	4,781	  	 	 	3,380	  	 	 	17,127	  	 	 	21,152	  	 	 	19,993	  	
Transaction-related costs(B)	 	 	6,087	  	 	 	901	  	 	 	18,454	  	 	 	—	  	 	 	—	  	
Severance and related charges	 	 	348	  	 	 	1,511	  	 	 	15,592	  	 	 	13,558	  	 	 	14,076	  	
1-week adjustment(C)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(7,436	) 	 	 	—	  	
Intercompany rent(D)	 	 	8,396	(D) 	 	 	—	  	 	 	7,543	(D) 	 	 	—	  	 	 	—	  	
Stock-based compensation	 	 	697	  	 	 	—	  	 	 	1,698	  	 	 	—	  	 	 	—	  	
Pension expense (credit)	 	 	(5,472	) 	 	 	(5,894	) 	 	 	(23,766	) 	 	 	66,765	  	 	 	39,192	  	
Other non-recurring costs(E)	 	 	291	  	 	 	18	  	 	 	3,111	  	 	 	8,393	  	 	 	2,692	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted EBITDA(F)	 	$	40,245	  	 	$	44,529	  	 	$	234,719	  	 	$	230,750	  	 	$	206,867	  	

 	(A)  	Represents the allocation of depreciation for certain assets of Tribune and its affiliates that support Tribune Publishing, including technology service center assets.	
 
 	(B)  	Transaction-related costs represent professional fees incurred in connection with the distribution, as well as costs associated with employee retention programs.	
 
 	(C)  	Since the year ended Dec. 30, 2012 was a 53-week year (based on our fiscal calendar), the 1-week adjustment allows for comparability with other fiscal years presented, which are 52-week years.	
 
 	(D)  	Intercompany rent represents rental expense recorded by Tribune Publishing for facilities owned by Tribune and its affiliates pursuant to related party lease agreements. This intercompany rent expense is added back to net income for better comparability between periods presented as Tribune Publishing began accounting for these related party leases on Dec. 1, 2013. For further discussion, see note (a) to the unaudited pro forma combined financial statements.	
 
 	(E)  	Other non-recurring costs include the write-down of certain software projects and real estate assets, one-time litigation settlements and certain other non-recurring costs such as lease terminations.	
 
 	(F)  	We note that Adjusted EBITDA does not reflect the potential impact resulting from the distribution and Tribune Publishing operating as a stand-alone public company, including any modification to the affiliation agreement between CareerBuilder and Tribune as a result of the distribution, the impact of affiliation agreements between Classified Ventures and our newspapers that may not be renewed or may be renewed on different terms or rental expense to be incurred by Tribune Publishing related to lease agreements with Tribune for certain facilities and office space. We expect that these items will have a material negative impact on Adjusted EBITDA following the distribution. For further discussion, including quantification of these items for certain periods, see notes (a) and (l) to the unaudited pro forma combined financial statements.	

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 RISK FACTORS
You should carefully consider each of the following risks, together with all of the other information in this information statement, in evaluating our common stock. Some of the following risks relate to the distribution of our common stock, including the effect of such distribution on Tribune. Other risks relate to our business, our anticipated indebtedness, the securities markets and ownership of our common stock. If any of the following risks and uncertainties develop into actual events, we could be materially and adversely affected. If this occurs, the trading price of our common stock could decline, and you may lose all or part of your investment.
Risks Relating to Our Business
We expect advertising demand to continue to be impacted by changes in economic conditions and fragmentation of the media landscape.
Advertising revenue is our primary source of revenue. Expenditures by advertisers tend to be cyclical, reflecting overall economic conditions, as well as budgeting and buying patterns. National and local economic conditions, particularly in major metropolitan markets, affect the levels of retail, national and classified newspaper advertising revenue. Changes in gross domestic product, consumer spending, auto sales, housing sales, unemployment rates, job creation, and circulation levels and rates, as well as federal, state and local election cycles, all impact demand for advertising.
A decline in the economic prospects of advertisers or the economy in general could alter current or prospective advertisers’ spending priorities. Consolidation across various industries, such as large department store and telecommunications companies, may also reduce our overall advertising revenue.
Competition from other media, including other metropolitan, suburban and national newspapers, broadcasters, cable systems and networks, satellite television and radio, websites, magazines, direct marketing and solo and shared mail programs, affects our ability to retain advertising clients and raise rates. In recent years, Internet sites devoted to recruitment, automotive and real estate have become significant competitors of our newspapers and websites for classified advertising, and retaining our historical share of classified advertising revenue remains a significant ongoing challenge.
Seasonal variations in consumer spending cause our quarterly advertising revenue to fluctuate. Second and fourth quarter advertising revenue is typically higher than first and third quarter advertising revenue, reflecting the slower economic activity in the winter and summer and the stronger fourth quarter holiday season.
Demand for our products is also a factor in determining advertising rates. For example, circulation levels for our newspapers, which have been declining, are a factor in determining advertising rates.
All of these factors continue to contribute to a difficult advertising sales environment and may further adversely impact our ability to grow or maintain our advertising revenue.
Increasing popularity of digital media and the shift in newspaper readership demographics, consumer habits and advertising expenditures from traditional print to digital media have adversely affected and may continue to adversely affect our operating revenues and may require significant capital investments due to changes in technology.
Technology in the media industry continues to evolve rapidly. Advances in technology have led to an increasing number of methods for delivery of news and other content and have resulted in a wide variety of consumer demands and expectations, which are also rapidly evolving. If we are unable to exploit new and existing technologies to distinguish our products and services from those of our competitors or adapt to new distribution methods that provide optimal user experiences, our business and financial results may be adversely affected.
 
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The increasing number of digital media options available on the Internet, through social networking tools and through mobile and other devices distributing news and other content, is expanding consumer choice significantly. Faced with a multitude of media choices and a dramatic increase in accessible information, consumers may place greater value on when, where, how and at what price they consume digital content than they do on the source or reliability of such content. Further, as existing newspaper readers get older, younger generations may not develop similar readership habits. News aggregation websites and customized news feeds (often free to users) may reduce our traffic levels by creating a disincentive for the audience to visit our websites or use our digital applications. If traffic levels stagnate or decline, we may not be able to create sufficient advertiser interest in our digital businesses or to maintain or increase the advertising rates of the inventory on our digital platforms.
In addition, the range of advertising choices across digital products and platforms and the large inventory of available digital advertising space have historically resulted in significantly lower rates for digital advertising than for print advertising. Consequently, our digital advertising revenue may not be able to replace print advertising revenue lost as a result of the shift to digital consumption. A decrease in our customers’ advertising expenditures, reduced demand for our offerings or a surplus of advertising inventory could lead to a reduction in pricing and advertising spending, which could have an adverse effect on our businesses and assets. Our ability to maintain and improve the performance of our customers’ advertising on our digital properties may impact rates we achieve in the marketplace for our advertising inventory.
Paywalls on our newspaper websites require users to pay for content after accessing a limited number of pages or news articles for free each month. Our ability to build a subscriber base on our digital platforms through these packages depends on market acceptance, consumer habits, pricing, an adequate online infrastructure, terms of delivery platforms and other factors. If our print subscribers opt out of the packages in greater numbers than we anticipate, we may not generate expected circulation revenue. In addition, the paywall may result in fewer page views or unique visitors to our websites if digital viewers are unwilling to pay to gain access to our digital content. Stagnation or a decline in website traffic levels may adversely affect our advertiser base and advertising rates and result in a decline in digital revenue.
Technological developments also pose other challenges that could adversely affect our operating revenues and competitive position. New delivery platforms may lead to pricing restrictions, the loss of distribution control and the loss of a direct relationship with consumers. Our advertising and circulation revenues have declined, reflecting general trends in the newspaper industry, including declining newspaper buying by young people and the migration to other available forms of media for news. We may also be adversely affected if the use of technology developed to block the display of advertising on websites proliferates.
Any changes we make to our business model to address these challenges may require significant capital investments. We may be limited in our ability to invest funds and resources in digital products, services or opportunities and we may incur costs of research and development in building and maintaining the necessary and continually evolving technology infrastructure. Some of our existing competitors and new entrants may have greater operational, financial and other resources or may otherwise be better positioned to compete for opportunities and as a result, our digital businesses may be less successful, which may adversely affect our business and financial results.
Macroeconomic trends may adversely impact our business, financial condition and results of operations.
Our operating revenues are sensitive to discretionary spending available to advertisers and subscribers in the markets we serve, as well as their perceptions of economic trends and uncertainty. Weak economic indicators in various regions across the nation, such as high unemployment rates, weakness in housing and continued uncertainty caused by national and state governments’ inability to resolve fiscal issues in a cost efficient manner to taxpayers may adversely impact advertiser and subscriber sentiment. These conditions could impair our ability to maintain and grow our advertiser and subscriber base.
 
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Our business operates in highly competitive markets and our ability to maintain market share and generate operating revenues depends on how effectively we compete with existing and new competition.
Our business operates in highly competitive markets. Our newspapers compete for audiences and advertising revenue with other newspapers as well as with other media such as the Internet, magazines, broadcast, cable and satellite television, radio, direct mail, and yellow pages. Some of our current and potential competitors have greater financial and other resources than we do.
Our newspaper publications generate significant percentages of their advertising revenue from a few categories, including automotive, employment, and real estate classified advertising. In recent years, websites dedicated to automotive, employment, and real estate advertising have become significant competitors of our newspapers and websites. As a result, even in the absence of a recession or economic downturn, technological, industry, or other changes specifically affecting these advertising sources could reduce advertising revenues and adversely affect our financial condition and results of operations.
Our operating revenues primarily consist of advertising and paid circulation. Competition for advertising expenditures and paid circulation comes from local, regional and national newspapers, magazines, broadcast, cable and satellite television, radio, direct mail, yellow pages, the Internet, outdoor billboards, and other media. Free circulation daily newspapers have been recently introduced in several metropolitan markets, and there can be no assurance that free daily publications, or other publications, will not be introduced in any markets in which we publish newspapers. The National Do Not Call Registry has affected the way newspapers solicit home-delivery circulation, particularly for larger newspapers that historically have relied on telemarketing. Competition for newspaper advertising revenue is based largely upon advertiser results, advertising rates, readership, demographics, and circulation levels, while competition for circulation is based largely upon the content of the newspaper, its price, editorial quality, customer service, and other sources of news and information. Our local and regional competitors in community newspapers are typically unique to each market, but we have competitors for advertising revenue that are larger and have greater financial and distribution resources than we do. Circulation revenue and our ability to achieve price increases for our print products may be affected by competition from other publications and other forms of media available in our various markets, declining consumer spending on discretionary items like newspapers, decreasing amounts of free time, and declining frequency of regular newspaper buying among certain demographics. We may incur higher costs competing for advertising dollars and paid circulation. If we are not able to compete effectively for advertising dollars and paid circulation, our operating revenues may decline and our financial condition and results of operations may be adversely affected.
Decreases, or slow growth, in circulation may adversely affect our circulation and advertising revenues.
Our newspapers, and the newspaper industry as a whole, are experiencing challenges to maintain and grow print circulation and circulation revenue. This results from, among other factors, increased competition from other media, particularly the Internet, changing newspaper readership demographics and shifting preferences among some consumers to receive all or a portion of their news other than from a newspaper. These factors could affect our ability to implement circulation price increases for our print products.
In addition, our circulation revenue is sensitive to discretionary spending available to subscribers in the markets we serve, as well as their perceptions of economic trends and uncertainty. Weak economic indicators in various regions across the nation may adversely impact subscriber sentiment and therefore impair our ability to maintain and grow our circulation.
A prolonged decline in circulation could affect the rate and volume of advertising revenue. To maintain our circulation base, we may incur additional costs, and may not be able to recover these costs through
 
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circulation and advertising revenue. To address declining circulation, we may increase spending on marketing designed to retain our existing subscriber base and continue or create niche publications targeted at specific market groups. We may also increase marketing efforts to drive traffic to our proprietary websites.
We anticipate that readership analyses will become increasingly important now that the Audit Bureau of Circulations has agreed to publish readership statistics and recognize Internet use in addition to circulation information. We believe this is a positive industry development but we cannot predict its effect on advertising revenue.
We rely on revenue from the printing and distribution of publications for third parties that may be subject to many of the same business and industry risks that we are.
We generate a substantial amount of revenue from printing and distributing third-party publications, and our relationships with these third parties are generally pursuant to short-term contracts. As a result, if the macroeconomic and industry trends described herein such as the sensitivity to perceived economic weakness of discretionary spending available to advertisers and subscribers, circulation declines, shifts in consumer habits and the increasing popularity of digital media affect those third parties, we may lose, in whole or in part, a substantial source of revenue.
In addition, one of the local publications we provide printing and distribution services to provided notice to us to terminate its printing and distribution agreements with us in May 2015 and May 2016, respectively. A decision by any of the three largest national publications or the major local publications to cease publishing and distribution in those markets, or seek alternatives to their current business practice of partnering with us, could materially impact our profitability.
Newsprint prices may continue to be volatile and difficult to predict and control.
Newsprint is one of our largest expenses. The price of newsprint has historically been volatile and the consolidation of North American newsprint mills over the years has reduced the number of suppliers. We have historically been able to realize favorable newsprint pricing by virtue of our company-wide volume and a long-term contract with a significant supplier. Failure to maintain our current consumption levels, further supplier consolidation or the inability to maintain our existing relationships with our newsprint suppliers may adversely impact newsprint prices in the future.
We may not be able to adapt to technological changes.
Advances in technologies or alternative methods of content delivery or changes in consumer behavior driven by these or other technologies could have a negative effect on our business. We cannot predict the effect such technologies will have on our operations. In addition, the expenditures necessary to implement these new technologies could be substantial and other companies employing such technologies before we are able to do so could aggressively compete with our business.
Technological developments may increase the threat of content piracy and limit our ability to protect intellectual property rights.
We seek to limit the threat of content piracy; however, policing unauthorized use of our products and services and related intellectual property is often difficult and the steps taken by us may not in every case prevent the infringement by unauthorized third parties. Developments in technology increase the threat of content piracy by making it easier to duplicate and widely distribute pirated material. Protection of our intellectual property rights is dependent on the scope and duration of our rights as defined by applicable laws in the U.S. and abroad and the manner in which those laws are construed. If those laws are drafted or interpreted in ways that limit the extent or duration of our rights, or if existing laws are changed, our ability to generate revenue from intellectual
 
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property may decrease, or the cost of obtaining and maintaining rights may increase. There can be no assurance that our efforts to enforce our rights and protect our products, services and intellectual property will be successful in preventing content piracy.
We rely on third-party vendors for various services.
We rely on third-party suppliers. We do not control the operation of these suppliers. If any of these third-party suppliers terminate their relationship with us, or do not provide an adequate level of service, it would be disruptive to our business as we seek to replace the supplier or remedy the inadequate level of service. This disruption may adversely affect our operating results.
We may not be able to adequately protect our intellectual property and other proprietary rights that are material to our business, or to defend successfully against intellectual property infringement claims by third parties.
Our ability to compete effectively depends in part upon our intellectual property rights, including our trademarks, copyrights and proprietary technology. Our use of contractual provisions, confidentiality procedures and agreements, and trademark, copyright, unfair competition, trade secret and other laws to protect our intellectual property rights and proprietary technology may not be adequate. Litigation may be necessary to enforce our intellectual property rights and protect our proprietary technology, or to defend against claims by third parties that the conduct of our businesses or our use of intellectual property infringes upon such third party’s intellectual property rights. Any intellectual property litigation or claims brought against us, whether or not meritorious, could result in substantial costs and diversion of our resources, and there can be no assurances that favorable final outcomes will be obtained in all cases. The terms of any settlement or judgment may require us to pay substantial amounts to the other party or cease exercising our rights in such intellectual property. In addition, we may have to seek a license to continue practices found to be in violation of a third party’s rights, which may not be available on reasonable terms, or at all. Our business, financial condition or results of operations may be adversely affected as a result.
Adverse results from litigation or governmental investigations can impact our business practices and operating results.
From time to time, we could be party to litigation, including matters relating to alleged libel or defamation, and regulatory, environmental and other proceedings with governmental authorities and administrative agencies. Adverse outcomes in lawsuits or investigations may result in significant monetary damages or injunctive relief that may adversely affect our operating results or financial condition as well as our ability to conduct our businesses as they are presently being conducted.
We may incur significant costs to address contamination issues at certain sites owned, operated or used by the publishing business of Tribune.
In connection with the distribution, we will agree to indemnify Tribune for any claims or expenses related to certain identified environmental issues. See “Relationships Between Tribune and Tribune Publishing Following the Distribution—Separation and Distribution Agreement.” The identified issues generally relate to sites historically owned, operated or used by Tribune’s publishing business at which contamination was identified. Historically, Tribune’s publishing business was obligated to investigate and remediate contamination at certain of these sites. Tribune was also required to contribute to cleanup costs at certain of these sites that were third-party waste disposal facilities at which it disposed of its wastes. We could have additional investigation and remediation obligations and be required to contribute to cleanup costs at these facilities. Environmental liabilities, including investigation and remediation obligations, could adversely affect our operating results or financial condition.
 
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We may not achieve the acquisition component of our business strategy, or successfully complete strategic acquisitions, investments or divestitures.
We continuously evaluate our businesses and make strategic acquisitions, investments and divestitures as part of our strategic plan. These transactions involve challenges and risks in negotiation, execution, valuation and integration. There can be no assurance that any such acquisitions, investments or divestitures can be completed.
We expect acquisitions to continue to be an important component of our business strategy; however, there can be no assurance that we will be able to grow our business through acquisitions, that any businesses acquired will perform in accordance with expectations or that business judgments concerning the value, strengths and weaknesses of businesses acquired will prove to be correct. Future acquisitions may result in the incurrence of debt and contingent liabilities, an increase in interest and amortization expense and significant charges relative to integration costs. Our strategy could be impeded if we do not identify suitable acquisition candidates and our financial condition and results of operations will be adversely affected if we overpay for acquisitions. Even if successfully negotiated, closed and integrated, certain acquisitions may prove not to advance our business strategy and may fall short of expected returns.
Acquisitions involve a number of risks, including:
 
 	—  	 	problems implementing disclosure controls and procedures for the newly acquired business;	
 
 	—  	 	the challenges in achieving strategic objectives, cost savings and other anticipated benefits;	
 
 	—  	 	unforeseen difficulties extending internal control over financial reporting and performing the required assessment at the newly acquired business;	
 
 	—  	 	potential adverse short-term effects on operating results through increased costs or otherwise;	
 
 	—  	 	potential future impairments of goodwill associated with the acquired business;	
 
 	—  	 	diversion of management’s attention and failure to recruit new, and retain existing, key personnel of the acquired business;	
 
 	—  	 	failure to successfully implement systems integration;	
 
 	—  	 	exceeding the capability of our systems; and	
 
 	—  	 	the risks inherent in the systems of the acquired business and risks associated with unanticipated events or liabilities, any of which could have a material adverse effect on our business, financial condition and results of operations.	
In addition, we may not be able to obtain financing necessary to complete acquisitions on attractive terms or at all.
Our ability to operate effectively could be impaired if we fail to attract and retain our senior management team.
Our success depends, in part, upon the continuing contributions of our senior management team. There is no guarantee that they will not leave. The loss of the services of any members of our senior management team or the failure to attract qualified persons to our senior management team may have a material adverse effect on our business or our business prospects.
 
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We may be obligated to make greater contributions to multiemployer defined benefit pension plans that cover our union-represented employees in the next several years than previously required, placing greater liquidity needs upon our operations.
We contribute to a number of multiemployer defined benefit pension plans under the terms of collective bargaining agreements that cover our union-represented employees. We are the only employer whose employees represent more than 5% of the total participation of each of the Chicago Newspaper Publishers Drivers’ Union Pension Plan (the “Drivers’ Plan”) and the GCIU Employer Retirement Benefit Plan.
On March 31, 2010, the Drivers’ Plan was certified by its actuary to be in critical status for the plan year beginning Jan. 1, 2010. As a result, the trustees of the Drivers’ Plan were required to adopt and implement a rehabilitation plan as of Jan. 1, 2011 designed to enable the Drivers’ Plan to cease being in critical status within the period of time stipulated by the Internal Revenue Code (the “IRC”). The terms of the rehabilitation plan adopted by the trustees require Tribune Publishing to make increased contributions beginning on Jan. 1, 2011 through Dec. 31, 2025, and the trustees of the Drivers’ Plan project that it will emerge from critical status on Jan. 1, 2026. Based on the actuarial assumptions utilized as of Jan. 1, 2010 to develop the rehabilitation plan, it is estimated that Tribune Publishing’s remaining share of the funding obligations to the Drivers’ Plan during the rehabilitation plan period is approximately $93 million as of Dec. 29, 2013. The funding obligation is subject to change based on a number of factors, including actual returns on plan assets as compared to assumed returns, changes in the number of plan participants and changes in the rate used for discounting future benefit obligations.
The risks of participating in these multiemployer plans are different from single-employer plans in that assets contributed are pooled and may be used to provide benefits to employees of other participating employers. If a participating employer withdraws from or otherwise ceases to contribute to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. Alternatively, if we stop participating in one of our multiemployer plans, we may incur a withdrawal liability based on the unfunded status of the plan.
Our possession and use of personal information and the use of payment cards by our customers present risks and expenses that could harm our business. Unauthorized access to or disclosure or manipulation of such data, whether through breach of our network security or otherwise, could expose us to liabilities and costly litigation and damage our reputation.
Maintaining our network security is of critical importance because our online systems store and process confidential subscriber and other sensitive data, such as names, email addresses, addresses and other personal information. We depend on the security of our networks and, in part, on the security of our third-party service providers. Unauthorized use of or inappropriate access to our, or our third-party service providers’, networks, computer systems and services could potentially jeopardize the security of confidential information, including payment card (credit or debit) information, of our customers. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and often are not recognized until launched against a target, we or our third-party service providers may be unable to anticipate these techniques or to implement adequate preventative measures. Non-technical means, for example, actions by an employee, can also result in a data breach. There can be no assurance that any security measures we, or our third-party service providers, take will be effective in preventing these activities. We may need to expend significant resources to protect against security breaches or to address problems caused by breaches. If an actual or perceived breach of our security occurs, the perception of the effectiveness of our security measures could be harmed and we could lose customers or users. A party that is able to circumvent our security measures could misappropriate our proprietary information or the information of our customers or users, cause interruption in our operations, or damage our computers or those of our customers or users. As a result of any such breaches, customers or users may assert claims of liability against us as a result of any failure by us to prevent these activities. These activities may subject us to legal claims, adversely impact our reputation, and interfere with our ability to provide our
 
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products and services, all of which may have a material adverse effect on our business, financial condition and results of operations. The coverage and limits of our insurance policies may not be adequate to reimburse us for losses caused by security breaches.
A significant number of our customers authorize us to bill their payment card accounts directly for all amounts charged by us. These customers provide payment card information and other personally identifiable information which, depending on the particular payment plan, may be maintained to facilitate future payment card transactions. Under payment card rules and our contracts with our card processors, if there is a breach of payment card information that we store, we could be liable to the banks that issue the payment cards for their related expenses and penalties. In addition, if we fail to follow payment card industry data security standards, even if there is no compromise of customer information, we could incur significant fines or lose our ability to give our customers the option of using payment cards. If we were unable to accept payment cards, our business would be seriously harmed.
Failure to protect confidential customer data or to provide customers with adequate notice of our privacy policies could also subject us to liabilities imposed by United States federal and state regulatory agencies or courts. We could also be subject to evolving state laws that impose data breach notification requirements, specific data security obligations, or other consumer privacy-related requirements. Our failure to comply with any of these laws or regulations may have an adverse effect on our business, financial condition and results of operations.
Labor strikes, lockouts and protracted negotiations can lead to business interruptions and increased operating costs.
As of Mar. 30, 2014, union employees comprised approximately 13% of our workforce. We are required to negotiate collective bargaining agreements across our business units on an ongoing basis. Complications in labor negotiations can lead to work slowdowns or other business interruptions and greater overall employee costs. If we or our suppliers are unable to renew expiring collective bargaining agreements, it is possible that the affected unions or others could take action in the form of strikes or work stoppages. Such actions, higher costs in connection with these agreements or a significant labor dispute could adversely affect our business by disrupting our ability to provide customers with our products or services. Depending on its duration, any lockout, strike or work stoppage may have an adverse effect on our operating revenues, cash flows or operating income or the timing thereof.
Changes in accounting standards can significantly impact reported earnings and operating results.
Generally accepted accounting principles and accompanying pronouncements and implementation guidelines for many aspects of our business, including those related to revenue recognition, intangible assets, pensions, income taxes and stock-based compensation are complex and involve significant judgments. Changes in these rules or their interpretation may significantly change our reported earnings and operating results.
Events beyond our control may result in unexpected adverse operating results.
Our results could be affected in various ways by global or domestic events beyond our control, such as wars, political unrest, acts of terrorism, and natural disasters. Such events can quickly result in significant declines in advertising revenue and significant increases in newsgathering costs.
Risks Relating to the Distribution
We have no operating history as a separate public company and may be unable to operate profitably after becoming a stand-alone company.
We have no operating history as a separate, stand-alone public company. Historically, because the publishing and the broadcasting businesses that comprised Tribune have been under one ultimate parent, they
 
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have been able to rely, to some degree, on the earnings, assets, and cash flow of each other for capital requirements. After the distribution, we will be able to rely only on the publishing business for such requirements. We cannot assure you that, as a separate public company, operating results will continue at historical levels, or that we will be profitable. Additionally, we have relied on Tribune for various financial, administrative and managerial services in conducting our operations. Following the distribution, we will maintain our own credit and banking relationships and in time will perform our own financial and investor relations functions. Although we may employ certain key employees of Tribune following the distribution, we cannot assure you that we will be able to successfully put in place, or thereafter maintain, the financial functions, administration and management necessary to operate as a separate company or that we will not incur additional costs operating as a separate public company. For example, prior to the distribution, we, as part of Tribune’s business, were able to use Tribune’s size to procure products and services on favorable terms. We could experience some increased costs after the distribution as a result of the absence of such economies of scale. Any such additional or increased costs may have a material adverse effect on our business, financial condition, or results of operations.
Our historical and pro forma financial information may not be indicative of our future results as a separate public company.
The historical and pro forma financial information we have included in this information statement may not reflect what our results of operations, financial position and cash flows would have been had we been a separate public company during the periods presented or be indicative of what our results of operations, financial position, and cash flows may be in the future when we are a separate public company. Our historical financial information reflects allocations for services historically provided by Tribune, and we expect these allocated costs to be different from the actual costs we will incur for these services in the future as a separate public company. In some instances, the costs incurred for these services as a separate public company may be higher than the share of total Tribune expenses allocated to our business historically.
The historical financial information does not reflect the increased costs associated with being a separate public company, including changes that we expect in our cost structure, personnel needs, financing, and operations of our business as a result of the distribution.
In addition, the pro forma financial information we have included in this information statement is based in part upon a number of estimates and assumptions. These estimates and assumptions may prove not to be accurate, and accordingly, our pro forma financial information should not be assumed to be indicative of what our financial condition or results of operations actually would have been as a separate company and may not be a reliable indicator of what our financial condition or results of operations actually may be in the future.
For additional information about our past financial performance and the basis of presentation of our financial statements, see “Selected Historical Combined Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our combined financial statements and the notes thereto in this information statement.
We may incur increased costs after the distribution or as a result of the separation from Tribune that may cause our profitability to decline.
Historically, our business has been operated as one of Tribune’s segments, and Tribune has performed many corporate functions for our operations, including managing financial and human resources systems, internal auditing, investor relations, treasury services, select accounting functions, finance and tax administration, benefits administration, legal, governmental relations and regulatory functions. Following the distribution, Tribune will provide support to us with respect to certain of these functions for periods to be specified in the transition services agreement and various other agreements described elsewhere in this information statement. We will need to replicate certain systems, infrastructure and personnel to which we will no longer have access after the distribution from Tribune. However, we may misjudge our requirements for these services and systems
 
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on a stand-alone basis, and may incur greater than expected capital and other costs associated with developing and implementing its own support functions in these areas. These costs may exceed the costs we will pay to Tribune during the transition period.
In addition, there may be an adverse operational effect on our business as a result of the significant time our management and other employees and internal resources will need to dedicate to building these capabilities during the first few years following the distribution that otherwise would be available for other business initiatives and opportunities. When we begin to operate these functions independently, if we have not developed adequate systems and business functions, or obtained them from other providers, we may not be able to operate the company effectively and our profitability may decline.
A portion of our advertising revenues is earned under affiliation agreements which may be terminated or amended to provide for less favorable terms following the distribution.
An affiliate of Tribune is currently party to an affiliation agreement with CareerBuilder, LLC (“CareerBuilder”) pursuant to which our newspapers earn advertising revenues and pay affiliate fees. Pursuant to the terms of the limited liability company agreement of CareerBuilder, if Tribune (together with its affiliates) were to cease to own at least a 30% voting and economic interest in our newspapers, CareerBuilder could terminate the existing affiliation agreement. However, if Tribune (together with its affiliates) directly or indirectly retains at least a 1% voting and economic interest in our newspapers, Tribune could elect to enter into a modified affiliation agreement that would apply to our newspapers for up to five years. This modified affiliation agreement would be on less favorable terms compared to the existing affiliation agreement. We have no history operating under such a modified affiliation agreement and are not able to predict how such agreement will impact our revenues in the future, though we expect that our advertising revenues from this modified affiliation agreement will be lower. Tribune will continue to hold a 1.5% stake in Tribune Publishing to allow Tribune Publishing for a period of up to five years to enter into and retain the benefits of the modified affiliation agreement at our newspapers. However, it is possible that Tribune will cease to retain at least a 1% interest in Tribune Publishing prior to the end of the five-year period, or other circumstances could occur, which could cause our newspapers to cease to earn advertising revenues under an affiliation agreement with CareerBuilder.
Each of our newspapers is currently party to an affiliation agreement with Classified Ventures, LLC (“Classified Ventures”) pursuant to which our newspapers earn advertising revenues and pay affiliate fees. The affiliation agreements are subject to annual renewal. There can be no assurance that our newspapers will be able to enter into annual renewals of these affiliation agreements on similar terms, or at all, and continue to earn the same level of advertising revenues under the affiliation agreements following the distribution. On April 1, 2014, Classified Ventures completed a transaction to sell its Apartments.com business. The sale of Apartments.com is expected to negatively impact our future revenues and affiliate fees from Classified Ventures. In addition, in connection with the sale of Apartments.com, we agreed to (i) provide links to Apartments.com from our primary newspaper websites and (ii) not engage in the business of providing a national searchable online resource for residential housing, each for a period of two years following the sale. If Classified Ventures were to sell its ownership interest in its primary remaining asset, Cars.com, it would likely further negatively impact our future revenues and affiliate fees from Classified Ventures. In addition, any dispositions of the assets of Classified Ventures, whether prior to or following the distribution, would not inure to the benefit of Tribune Publishing.
Tribune Publishing records revenue related to the CareerBuilder and Classified Ventures affiliation agreements for classified advertising products placed on affiliated digital platforms. Such amounts totaled $10 million and $19 million for the three months ended Mar. 30, 2014 and $44 million and $71 million for the year ended Dec. 29, 2013 related to CareerBuilder and Classified Ventures, respectively. Tribune Publishing also pays fees to CareerBuilder and Classified Ventures under the affiliation agreements related to selling the classified advertising products. Such amounts totaled $2 million and $7 million for the three months ended Mar. 30, 2014 and $5 million and $24 million for the year ended Dec. 29, 2013 for CareerBuilder and Classified Ventures, respectively.
 
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If we cease to earn advertising revenues under the affiliation agreements with CareerBuilder and Classified Ventures or the amount of such revenues is materially reduced, our operating revenues, financial condition and results of operations could be materially and adversely affected.
Fulfilling our obligations incident to being a public company, including with respect to the requirements of and related rules under the Sarbanes-Oxley Act of 2002, will be expensive and time-consuming, and our accounting, management and financial reporting systems may not be adequately prepared to comply with public company reporting, disclosure controls and internal control over financial reporting requirements.
We have historically operated as a subsidiary of Tribune and have not been subject to the same financial and other reporting and corporate governance requirements as a public company. Following the distribution, we will be required to file annual, quarterly and other reports with the Securities and Exchange Commission (“SEC”). We will need to prepare and timely file financial statements that comply with SEC reporting requirements. We will also be subject to other reporting and corporate governance requirements under the listing standards of the New York Stock Exchange and the Sarbanes-Oxley Act of 2002, which will impose significant new compliance costs and obligations upon us. The changes necessitated by becoming a public company will require a significant commitment of additional resources and management oversight which will increase our operating costs. These changes will also place significant additional demands on our finance and accounting staff and on our financial accounting and information systems and may require us to upgrade our systems, implement additional financial and management controls, reporting systems, IT systems and procedures, and hire additional accounting, legal and finance staff. Other expenses associated with being a public company include increases in auditing, accounting and legal fees and expenses, investor relations expenses, increased directors’ fees and director and officer liability insurance costs, registrar and transfer agent fees and listing fees, as well as other expenses. As a public company, we will be required, among other things, to:
 
 	—  	 	prepare and file periodic and current reports, and distribute other stockholder communications, in compliance with the federal securities laws and New York Stock Exchange rules;	
 
 	—  	 	define and expand the roles and the duties of our Board of Directors and its committees;	
 
 	—  	 	institute comprehensive compliance, investor relations and internal audit functions; and	
 
 	—  	 	evaluate and maintain our system of internal control over financial reporting, and report on management’s assessment thereof, in compliance with rules and regulations of the SEC and the Public Company Accounting Oversight Board.	
In particular, beginning with the year ending Dec. 31, 2015, we will be required to perform system and process evaluation and testing of our internal control over financial reporting to allow management to report on the effectiveness of our internal control over financial reporting, as required by Section 404(a) of the Sarbanes-Oxley Act of 2002. Likewise, our independent registered public accounting firm will be required to provide an attestation report on the effectiveness of our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002. In addition, following the distribution, we will be required under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to maintain disclosure controls and procedures and internal control over financial reporting. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm our operating results or cause us to fail to meet our reporting obligations. If we are unable to conclude that we have effective internal control over financial reporting, or if our independent registered public accounting firm is unable to provide us with an unqualified report regarding the effectiveness of our internal control over financial reporting (at such time as it is required to do so), investors could lose confidence in the reliability of our financial statements. This could result in a decrease in the value of our common stock. Failure to comply with the Sarbanes-Oxley Act of 2002 could potentially subject us to sanctions or investigations by the SEC or other regulatory authorities. If we are unable to upgrade our systems, implement additional financial and management controls, reporting systems, IT systems
 
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and procedures, and hire additional accounting, legal and finance staff in a timely and effective fashion, our ability to comply with our financial reporting requirements and other rules that apply to reporting companies under the Exchange Act and the Sarbanes-Oxley Act could be impaired.
We may incur increased expenses if the transition services agreement and other agreements with Tribune are terminated.
In connection with the distribution, we will enter into a transition services agreement and various other agreements with Tribune, pursuant to which Tribune will provide us with certain specified services on a transitional basis, including in such areas as human resources, risk management, treasury, legal, internal audit, technology support and other areas where we may need assistance and support following the distribution. Depending on the particular service being provided, the agreements will extend for up to two years after the distribution, but may be terminated earlier under certain circumstances, including a default. If one or more of the agreements are terminated, we may be required to obtain such services from a third party. This may be more expensive than the fees that we will be required to pay under the agreements with Tribune.
If the distribution does not qualify as a tax-free distribution under Section 355 of the IRC, including as a result of subsequent acquisitions of stock of Tribune or Tribune Publishing, then Tribune or Tribune stockholders and warrantholders may be required to pay substantial U.S. federal income taxes, and Tribune Publishing may be obligated to indemnify Tribune for such taxes imposed on Tribune or Tribune stockholders and warrantholders as a result thereof.
Tribune has received a private letter ruling (the “IRS Ruling”) from the Internal Revenue Service (the “IRS”) to the effect that the distribution and certain related transactions will qualify as tax-free to Tribune, Tribune Publishing and the Tribune stockholders and warrantholders for U.S. federal income tax purposes. Although a private letter ruling from the IRS generally is binding on the IRS, the IRS Ruling does not rule that the distribution satisfies every requirement for a tax-free distribution, and the parties will rely solely on the opinion of counsel described below for comfort that such additional requirements are satisfied.
The distribution is conditioned upon Tribune’s receipt of an opinion of Debevoise & Plimpton LLP, special tax counsel to Tribune, to the effect that the distribution and certain related transactions will qualify as tax-free to Tribune and the stockholders and warrantholders of Tribune. The opinion of Tribune’s special tax counsel is expected to rely on the IRS Ruling as to matters covered by it.
The IRS Ruling is, and the opinion of Tribune’s special tax counsel will be, based on, among other things, certain representations and assumptions as to factual matters made by Tribune and certain of the Tribune stockholders. The failure of any factual representation or assumption to be true, correct and complete in all material respects could adversely affect the validity of the IRS Ruling or the opinion of Tribune’s special tax counsel. An opinion of counsel represents counsel’s best legal judgment, is not binding on the IRS or the courts, and the IRS or the courts may not agree with the opinion. In addition, the IRS Ruling and the opinion of Tribune’s special tax counsel will be based on current law, and cannot be relied upon if current law changes with retroactive effect.
The distribution will be taxable to Tribune pursuant to Section 355(e) of the IRC if there is a 50% or more change in ownership of either Tribune or Tribune Publishing, directly or indirectly, as part of a plan or series of related transactions that include the distribution. Section 355(e) might apply if other acquisitions of stock of Tribune before or after the distribution, or of Tribune Publishing after the distribution, are considered to be part of a plan or series of related transactions that include the distribution. If Section 355(e) applied, Tribune might recognize a very substantial amount of taxable gain.
Under the tax matters agreement, in certain circumstances, and subject to certain limitations, we are required to indemnify Tribune against taxes on the distribution that arise as a result of our actions or failures to
 
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act after the distribution. See “Risk Factors—Risks Relating to the Distribution—We will be unable to take certain actions after the distribution because such actions could jeopardize the tax-free status of the distribution, and such restrictions could be significant” and “Relationships Between Tribune and Tribune Publishing Following the Distribution—Tax Matters Agreement.” In some cases, however, Tribune might recognize gain on the distribution without being entitled to an indemnification payment under the tax matters agreement.
See “The Distribution—Material U.S. Federal Income Tax Consequences of the Distribution.”
We will be unable to take certain actions after the distribution because such actions could jeopardize the tax-free status of the distribution, and such restrictions could be significant.
The tax matters agreement prohibits us from taking actions that could reasonably be expected to cause the distribution to be taxable or to jeopardize the conclusions of the IRS Ruling or opinions of counsel received by us or Tribune. In particular, for two years after the distribution, we may not:
 
 	—  	 	enter into any agreement, understanding or arrangement or engage in any substantial negotiations with respect to any transaction involving the acquisition, issuance, repurchase or change of ownership of our capital stock, or options or other rights in respect of our capital stock, subject to certain exceptions relating to employee compensation arrangements and open market stock repurchases;	
 
 	—  	 	cease the active conduct of our business; or	
 
 	—  	 	voluntarily dissolve, liquidate, merge or consolidate with any other person, unless we survive and the transaction otherwise complies with the restrictions in the tax matters agreement.	
Nevertheless, we are permitted to take any of the actions described above if we obtain Tribune’s consent, or if we obtain a supplemental IRS private letter ruling (or an opinion of counsel that is reasonably acceptable to Tribune) to the effect that the action will not affect the tax-free status of the distribution. However, the receipt by us of any such consent, opinion or ruling does not relieve us of any obligation we have to indemnify Tribune for an action we take that causes the distribution to be taxable to Tribune.
Because of these restrictions, for two years after the distribution, we may be limited in the amount of capital stock that we can issue to make acquisitions or to raise additional capital. Also, our indemnity obligation to Tribune may discourage, delay or prevent a third party from acquiring control of us during this two-year period in a transaction that our stockholders might consider favorable. See “Relationships Between Tribune and Tribune Publishing Following the Distribution—Tax Matters Agreement” and “The Distribution—Material U.S. Federal Income Tax Consequences of the Distribution.”
The combined post-distribution value of Tribune and Tribune Publishing shares may not equal or exceed the pre-distribution value of Tribune shares.
After the distribution, we expect that Tribune common stock will continue to be traded over-the-counter. We have applied to list the shares of our common stock on the New York Stock Exchange. We cannot assure you that the combined trading prices of Tribune common stock and our common stock after the distribution, as adjusted for any changes in the combined capitalization of both companies, will be equal to or greater than the trading price of Tribune common stock prior to the distribution. Until the market has fully evaluated the business of Tribune without our business and potentially thereafter, the price at which Tribune common stock trades may fluctuate significantly. Similarly, until the market has fully evaluated our business and potentially thereafter, the price at which our common stock trades may fluctuate significantly.
 
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After the distribution, certain members of management, directors and stockholders may face actual or potential conflicts of interest.
After the distribution, our management and directors and the management and directors of Tribune may own both Tribune common stock and our common stock. This ownership overlap could create, or appear to create, potential conflicts of interest when our management and directors and Tribune’s management and directors face decisions that could have different implications for us and Tribune. For example, potential conflicts of interest could arise in connection with the resolution of any dispute between us and Tribune regarding the terms of the agreements governing the distribution and our relationship with Tribune thereafter. These agreements include the separation and distribution agreement, the tax matters agreement, the employee matters agreement, the transition services agreement and any commercial agreements between the parties or their affiliates. Potential conflicts of interest may also arise out of any commercial arrangements that we or Tribune may enter into in the future.
Federal Communications Commission regulations may limit Tribune Publishing’s activities, including the ability to own or operate media properties it does not presently own or operate.
The FCC’s “Newspaper Broadcast Cross Ownership Rule” (the “NBCO Rule”) prohibits a person or entity from having an “attributable” ownership or positional interest in a broadcast station and a daily newspaper published in the same market. For purposes of the NBCO Rule, any common officer, director or 5% or greater voting stockholder of Tribune and Tribune Publishing (“Common Interest Holder”) will be deemed to hold an attributable interest in both companies after the distribution. The existence of a Common Interest Holder may have the effect of limiting the activities or strategic business opportunities available to one company as a result of the business or activities of the other, including limiting our ability to acquire daily newspapers in markets where Tribune operates a broadcast station. Tribune’s existing Chicago market radio/television/newspaper combination has been permanently grandfathered by the FCC, and its television/newspaper combinations in the New York, Los Angeles, Miami-Fort Lauderdale and Hartford-New Haven markets are subject to temporary waivers of the NBCO Rule granted on Nov. 16, 2012, in connection with the FCC’s approval of Tribune’s plan of reorganization (the “Exit Order”).
The temporary waivers require Tribune to come into compliance with the NBCO rule within one year from the release date of the Exit Order or, if the FCC adopts a revised NBCO rule before the one-year deadline, authorizes Tribune to seek waivers of the revised rule by filing new waiver requests within 60 days after the FCC releases the order revising the NBCO rule. Because the FCC had not adopted a revised NBCO Rule by Nov. 12, 2013, on that date Tribune filed with the FCC a request for extension of the temporary NBCO rule waivers granted in the Exit Order (in New York, Los Angeles, Miami-Fort Lauderdale and Hartford-New Haven). The request is pending. On Mar. 31, 2014, the FCC initiated its Congressionally-mandated 2014 Quadrennial Review proceeding, in which it is requesting comment on whether its media ownership rules, including the NBCO Rule, are necessary in the public interest as a result of competition. The FCC has indicated it does not intend to act on the 2014 Quadrennial Review before June 30, 2016 at the earliest. We cannot predict the outcome of this proceeding or whether or the extent to which the FCC will reauthorize Tribune’s existing temporary waivers.
We may not be able to access the credit and capital markets at the times and in the amounts needed and on acceptable terms.
From time to time we may need to access the long-term and short-term capital markets to obtain financing. Although we believe that the sources of capital in place at the time of the distribution will permit us to finance our operations for the foreseeable future on acceptable terms and conditions, our access to, and the availability of, financing on acceptable terms and conditions in the future will be impacted by many factors, including: (1) our financial performance, (2) our credit ratings or absence of a credit rating, (3) the liquidity of the overall capital markets and (4) the state of the economy. There can be no assurance that we will have access to the capital markets on terms acceptable to us.
 
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Until the distribution occurs, Tribune has the sole discretion to change the terms of the distribution.
Until the distribution occurs, Tribune will have the sole and absolute discretion to determine and change the terms of the distribution, including the record date and distribution date. These changes may be unfavorable to us. In addition, Tribune may decide at any time not to proceed with the distribution.
Federal and state fraudulent transfer laws and Delaware corporate law may permit a court to void the distribution and related transactions, which would adversely affect our financial condition and our results of operations.
In connection with the distribution, Tribune intends to undertake a series of internal corporate reorganization transactions which, along with the contribution of Tribune’s publishing businesses, the distribution of Tribune Publishing shares and the cash dividend to be paid to Tribune, may be subject to challenge under federal and state fraudulent conveyance and transfer laws as well as under Delaware corporate law. Under applicable laws, any transaction, contribution or distribution contemplated as part of the distribution could be voided as a fraudulent transfer or conveyance if, among other things, the transferor received less than reasonably equivalent value or fair consideration in return and was insolvent or rendered insolvent by reason of the transfer.
We cannot be certain as to the standards a court would use to determine whether or not any entity involved in the distribution was insolvent at the relevant time. In general, however, a court would look at various facts and circumstances related to the entity in question, including evaluation of whether or not:
 
 	—  	 	the sum of its debts, including contingent and unliquidated liabilities, was greater than the fair saleable value of all of its assets;	
 
 	—  	 	the present fair saleable value of its assets was less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they become absolute and mature; or	
 
 	—  	 	it could pay its debts as they become due.	
If a court were to find that any transaction, contribution or distribution involved in the distribution was a fraudulent transfer or conveyance, the court could void the transaction, contribution or distribution. In addition, the distribution could also be voided if a court were to find that it is not a legal distribution or dividend under Delaware corporate law. The resulting complications, costs and expenses of either finding would materially adversely affect our financial condition and results of operations.
Risks Relating to our Indebtedness
In connection with the distribution, we expect to incur indebtedness, which could adversely affect our financial condition and prevent us from fulfilling our obligations under anticipated agreements governing our indebtedness.
In connection with the distribution, we expect to borrow approximately $350 million, with a portion of the proceeds to be used to fund a cash dividend to Tribune of up to $275 million immediately prior to the distribution. In addition, prior to the distribution, we expect to enter into the Senior ABL Facility with aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million and to enter into an arrangement to allow cash backed letters of credit, with approximately $25 million issued on our behalf. We also expect to have approximately $25 million of additional letters of credit issued under the Senior ABL Facility as of the distribution date, for a total of approximately $50 million of letters of credit. The Senior ABL Facility is expected to include flexibility for additional letters of credit to be issued thereunder. Our level of debt could have important consequences to our stockholders, including:
 
 	—  	 	limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements;	
 
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 	—  	 	requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes;	
 
 	—  	 	increasing our vulnerability to general adverse economic and industry conditions;	
 
 	—  	 	limiting our ability to pay dividends;	
 
 	—  	 	exposing us to the risk of increased interest rates to the extent that our borrowings are at variable rates of interest;	
 
 	—  	 	limiting our flexibility in planning for and reacting to changes in the industry in which we compete;	
 
 	—  	 	placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt and more favorable terms and thereby affecting our ability to compete; and	
 
 	—  	 	increasing our cost of borrowing.	
We and our subsidiaries may incur significant additional indebtedness in the future. If new indebtedness is added to our anticipated indebtedness levels after the distribution, the related risks that we face would increase.
We may not be able to generate sufficient cash to service our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.
Our ability to make scheduled payments on or refinance our anticipated debt obligations will depend on our financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to financial, business, legislative, regulatory and other factors beyond our control. We might not be able to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. For information regarding the risks to our business that could impair our ability to satisfy our obligations under our indebtedness, see “—Risks Relating to Our Business.” If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to dispose of material assets or operations, seek additional debt or equity capital or restructure or refinance our indebtedness. We may not be able to affect any such alternative measures on commercially reasonable terms or at all and, even if successful, those alternative actions may not allow us to meet our scheduled debt service obligations. We expect that the agreements governing our indebtedness will restrict our ability to dispose of assets and use the proceeds from those dispositions and will also restrict our ability to raise debt capital to be used to repay other indebtedness when it becomes due. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet any debt service obligations then due. Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, would materially and adversely affect our financial condition and results of operations and our ability to satisfy our obligations under our indebtedness.
If we cannot make scheduled payments on our debt, we will be in default and lenders could declare all outstanding principal and interest to be due and payable, the lenders under our expected revolving credit facility could terminate their commitments to loan money, the lenders could foreclose against the assets securing their loans and we could be forced into bankruptcy or liquidation. All of these events could result in you losing some or all of the value of your investment.
The terms of the agreements governing our indebtedness are expected to restrict our current and future operations, particularly our ability to respond to changes or to take certain actions, which could harm our long-term interests.
We expect that the agreements governing our Senior Credit Facilities will contain a number of restrictive covenants that will impose significant operating and financial restrictions on us and limit our ability to
 
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engage in actions that may be in our long-term best interests. These restrictions might hinder our ability to grow in accordance with our strategy. A breach of the covenants under the agreements governing our indebtedness could result in an event of default under those agreements. Such a default may allow certain creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies. In the event the lenders accelerate the repayment of our borrowings, we and our subsidiaries may not have sufficient assets to repay that indebtedness.
As a result of all of these restrictions, we may be:
 
 	—  	 	limited in how we conduct our business;	
 
 	—  	 	limited or unable to pay dividends to our shareholders in certain circumstances;	
 
 	—  	 	unable to raise additional debt or equity financing to operate during general economic or business downturns; or	
 
 	—  	 	unable to compete effectively or to take advantage of new business opportunities.	
Our indebtedness is expected to have variable rates of interest, which could subject us to interest rate risk or cause our debt service obligations to increase significantly.
Borrowings under the Senior ABL Facility are expected to be at variable rates of interest and, to the extent LIBOR exceeds 1.00%, borrowings under our Senior Term Facility are expected to be at variable rates of interest, which could expose us to interest rate risk. Interest rates are currently at historically low levels. If interest rates increase, our future debt service obligations on the variable rate portion of our indebtedness would increase even though the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease. Assuming all revolving loans are fully drawn under our Senior Credit Facilities and LIBOR exceeds 1.00%, each quarter point change in interest rates would result in a $1.2 million change in annual interest expense on our indebtedness. In the future, we may enter into interest rate swaps that involve the exchange of floating for fixed rate interest payments in order to reduce future interest rate volatility. However, due to risks for hedging gains and losses and cash settlement costs, we may elect not to maintain such interest rate swaps with respect to any of our variable rate indebtedness, and any swaps we enter into may not fully mitigate our interest rate risk.
Risks Related to Tribune Company’s Emergence from Bankruptcy
We may not be able to settle, on a favorable basis or at all, unresolved claims filed in connection with the Chapter 11 proceedings and resolve the appeals seeking to overturn the order confirming the Plan.
On Dec. 31, 2012, Tribune and 110 of its direct and indirect wholly-owned subsidiaries (collectively, the “Debtors”) that had filed voluntary petitions for relief under Chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) on Dec. 8, 2008 (or on Oct. 12, 2009, in the case of Tribune CNLBC, LLC) emerged from Chapter 11. Certain of the legal entities included in the combined financial statements of Tribune Publishing were Debtors or, as a result of the restructuring transactions undertaken at the time of the Debtors’ emergence, are successor legal entities to legal entities that were Debtors. See Notes 2 and 3 to the historical combined financial statements for further information. The Debtors’ Chapter 11 cases have not yet been closed by the Bankruptcy Court, and certain claims asserted against the Debtors in the Chapter 11 cases remain unresolved. As a result, we expect to continue to incur certain expenses pertaining to the Chapter 11 proceedings in future periods, which may be material.
On April 12, 2012, the Debtors, the official committee of unsecured creditors and creditors under certain Tribune prepetition debt facilities filed the Fourth Amended Joint Plan of Reorganization for Tribune Company
 
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and its Subsidiaries (subsequently amended and modified, the “Plan”) with the Bankruptcy Court. On July 23, 2012, the Bankruptcy Court issued an order confirming the Plan (the “Confirmation Order”). Several notices of appeal of the Confirmation Order have been filed. The appellants seek, among other relief, to overturn the Confirmation Order and certain prior orders of the Bankruptcy Court, including the settlement of certain claims and causes of action related to the Leveraged ESOP Transactions that was embodied in the Plan (see Note 2 to the audited combined financial statements for further information). There is currently no stay of the Confirmation Order in place pending resolution of the confirmation-related appeals and those appeals remain pending before the Delaware District Court. In January 2013, the reorganized Debtors filed a motion to dismiss the appeals as equitably moot, based on the substantial consummation of the Plan. That request has been fully briefed by the parties and the motion remains pending. If the appellants were successful in overturning the Confirmation Order and certain prior orders of the Bankruptcy Court, our financial condition may be adversely affected.
Risks Relating to our Common Stock and the Securities Market
Certain provisions of our certificate of incorporation, by-laws, tax matters agreement, separation and distribution agreement, employee matters agreement, transition services agreement, and Delaware law may discourage takeovers.
We expect that our amended and restated certificate of incorporation and amended and restated by-laws will contain certain provisions that may discourage, delay or prevent a change in our management or control over us. For example, we expect our amended and restated certificate of incorporation and amended and restated by-laws to, collectively:
 
 	—  	 	authorize the issuance of “blank check” preferred stock that could be issued by our Board of Directors to thwart a takeover attempt;	
 
 	—  	 	provide that vacancies on our Board of Directors, including vacancies resulting from an enlargement of our Board of Directors, may be filled only by a majority vote of directors then in office;	
 
 	—  	 	prohibit stockholders from calling special meetings of stockholders;	
 
 	—  	 	prohibit stockholder action by written consent;	
 
 	—  	 	establish advance notice requirements for nominations of candidates for elections as directors or to bring other business before an annual meeting of our stockholders; and	
 
 	—  	 	require the approval of holders of at least 66  2 ⁄ 3 % of the outstanding shares of our common stock to amend certain provisions of our amended and restated certificate of incorporation or to amend our amended and restated by-laws.	
These provisions could discourage potential acquisition proposals and could delay or prevent a change in control, even though a majority of stockholders may consider such proposal, if effected, desirable. Such provisions could also make it more difficult for third parties to remove and replace the members of the Board of Directors. Moreover, these provisions may inhibit increases in the trading price of our common stock that may result from takeover attempts or speculation. See “Description of Capital Stock—Anti-Takeover Effects of Various Provisions of Delaware Law, Our Amended and Restated Certificate of Incorporation and Amended and Restated By-Laws.”
Under the tax matters agreement, we have agreed to indemnify Tribune for certain tax related matters, and we may be unable to take certain actions after the distribution. See “—Risks Relating to the Distribution—We will be unable to take certain actions after the distribution because such actions could jeopardize the tax-free
 
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status of the distribution, and such restrictions could be significant.” We will also enter into, among others, the separation and distribution agreement, the tax matters agreement, the employee matters agreement and the transition services agreement covering specified indemnification and other matters that may arise after the distribution. The separation and distribution agreement, the tax matters agreement, the employee matters agreement and the transition services agreement may have the effect of discouraging or preventing an acquisition of us or a disposition of our business.
Substantial sales of our common stock following the distribution, or the perception that such sales might occur, could depress the market price of our common stock.
Substantially all of the shares of our common stock distributed in the distribution will be eligible for immediate resale in the public market, unless held by “affiliates” as that term is defined in Rule 144 under the Securities Act. Any sales of substantial amounts of our common stock in the public market, or the perception that such sales might occur, could depress the market price of our common stock. In addition, our smaller size and different investment characteristics may not appeal to the current investor base of Tribune, which may seek to dispose of large amounts of our common stock following the distribution. There is no assurance that there will be sufficient buying interest to offset any such sales, and, accordingly, the price of our common stock may be depressed by those sales and have periods of volatility.
The market price for our common stock may be volatile, and you may not be able to sell your common stock at the initial trading price.
There has been no public market for our common stock prior to the distribution. An active public market for our common stock may not be sustained after the distribution. The price of our common stock in any such market may be higher or lower than the initial trading price. Many factors could cause the trading price of our common stock to rise and fall, including the following:
 
 	—  	 	declining newspaper print circulation;	
 
 	—  	 	declining operating revenues derived from our core business;	
 
 	—  	 	variations in quarterly results;	
 
 	—  	 	announcements regarding dividends;	
 
 	—  	 	announcements of technological innovations by us or by competitors;	
 
 	—  	 	introductions of new products or services or new pricing policies by us or by competitors;	
 
 	—  	 	acquisitions or strategic alliances by us or by competitors;	
 
 	—  	 	recruitment or departure of key personnel or key groups of personnel;	
 
 	—  	 	the gain or loss of significant advertisers or other customers;	
 
 	—  	 	changes in the estimates of our operating performance or changes in recommendations by any securities analysts that elect to follow our stock; and	
 
 	—  	 	market conditions in the newspaper industry, the media industry, the industries of our customers, and the economy as a whole.	
 
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Our ability to pay regular dividends to our stockholders is subject to the discretion of our Board of Directors and may be limited by restrictions under our Senior Credit Facilities and applicable provisions of Delaware law.
Following the distribution, we intend to pay quarterly cash dividends on our common stock. However, our Board of Directors may, in its sole discretion, change the amount or frequency of dividends or discontinue the payment of dividends entirely. The declaration and payment of dividends to holders of our common stock will be at the discretion of our Board of Directors in accordance with applicable law after taking into account various factors, including actual results of operations, liquidity and financial condition, restrictions imposed by applicable law, our taxable income, our operating expenses and other factors our Board of Directors deem relevant. In addition, because we are a holding company with no material direct operations, we are dependent on loans, dividends and other payments from our operating subsidiaries to generate the funds necessary to pay dividends on our common stock. We expect to cause our subsidiaries to make distributions to us in an amount sufficient for us to pay dividends. However, their ability to make such distributions will be subject to their operating results, cash requirements and financial condition and the applicable provisions of Delaware law that may limit the amount of funds available for distribution, and our ability to pay cash dividends will be subject to covenants and financial ratios related to existing or future indebtedness, including under our Senior Credit Facilities, and other agreements with third parties. See “Dividend Policy.”
In addition, each of the companies in our corporate chain must manage its assets, liabilities and working capital in order to meet all of its cash obligations, including the payment of dividends or distributions. As a consequence of these various limitations and restrictions, we may not be able to make, or may have to reduce or eliminate, the payment of dividends on our common stock. Any change in the level of our dividends or the suspension of the payment thereof could adversely affect the market price of our common stock.
If securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our stock price and trading volume could decline.
The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If there is no coverage of our company by securities or industry analysts, the trading price for our stock would be negatively impacted. In the event we obtain securities or industry analyst coverage or if one or more of these analysts downgrades our stock or publishes misleading or unfavorable research about our business, our stock price would likely decline. If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock may decrease, which could cause our stock price or trading volume to decline.
Our amended and restated certificate of incorporation will designate the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us.
Our amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us or our stockholders by any of our directors, officers, employees or agents, (iii) any action asserting a claim against us arising under the General Corporation Law of the State of Delaware (the “DGCL”), our amended and restated certificate of incorporation or our amended and restated by-laws or (iv) any action asserting a claim against us that is governed by the internal affairs doctrine. By becoming a stockholder in our company, you will be deemed to have notice of and have consented to the provisions of our amended and restated certificate of incorporation related to choice of forum. The choice of forum provision in our amended and restated certificate of incorporation may limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us.
 
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 CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
The statements contained in this information, as well as the information contained in the notes to our combined financial statements, including the statements found in the section entitled “Risk Factors,” include certain forward-looking statements that are based largely on our current expectations and reflect various estimates and assumptions by us. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results and achievements to differ materially from those expressed in such forward looking statements. Such risks, trends and uncertainties, which in some instances are beyond our control, include:
 
—  	 	competition and other economic conditions including fragmentation of the media landscape and competition from other media alternatives;	
 
—  	 	changes in advertising demand, circulation levels and audience shares;	
 
—  	 	our ability to develop and grow our online businesses;	
 
—  	 	our reliance on revenue from printing and distributing third-party publications;	
 
—  	 	changes in newsprint prices;	
 
—  	 	macroeconomic trends and conditions;	
 
—  	 	our reliance on third-party vendors for various services;	
 
—  	 	our ability to adapt to technological changes;	
 
—  	 	adverse results from litigation, governmental investigations or tax-related proceedings or audits;	
 
—  	 	our ability to realize benefits or synergies from acquisitions or divestitures or to operate our businesses effectively following acquisitions or divestitures;	
 
—  	 	our ability to attract and retain employees;	
 
—  	 	our ability to satisfy pension and other postretirement employee benefit obligations;	
 
—  	 	changes in accounting standards;	
 
—  	 	the effect of labor strikes, lockouts and labor negotiations;	
 
—  	 	regulatory and judicial rulings;	
 
—  	 	our indebtedness and ability to comply with covenants applicable to our anticipated debt financing;	
 
—  	 	our adoption of fresh-start reporting which has caused our combined financial statements for periods subsequent to Dec. 31, 2012 to not be comparable to prior periods;	
 
—  	 	our ability to satisfy future capital and liquidity requirements; and	
 
—  	 	our ability to access the credit and capital markets at the times and in the amounts needed and on acceptable terms.	
The words “believe,” “expect,” “anticipate,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek” and similar expressions generally identify forward looking statements. Whether or not any such forward-looking statements are in fact achieved will depend on future events, some of which are beyond our control. Readers are cautioned not to place undue reliance on such forward-looking statements, which are being made as of the date of this information statement. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
 
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 THE DISTRIBUTION
Introduction
We expect the distribution to be accomplished by transferring the assets and liabilities of the publishing business of Tribune to Tribune Publishing and then distributing 98.5% of the shares of Tribune Publishing common stock to Tribune’s stockholders and holders of Warrants.
Holders of Tribune common stock and Warrants will receive 0.25 of a share of Tribune Publishing common stock for every share of Tribune common stock or Warrant, respectively, owned on the record date for the distribution.
If you hold your Tribune shares or Warrants in your own name, then your account statement reflecting the Tribune Publishing shares will be mailed to you on or about         , 2014. You should allow several days for the mail to reach you. If you hold your Tribune shares or Warrants through your broker or other nominee, you are probably not a stockholder of record and your receipt of Tribune Publishing shares depends on your arrangements with the nominee that holds your Tribune shares or Warrants for you. We anticipate that brokers and other nominees generally will credit their customers’ accounts with Tribune Publishing shares on or about         , 2014, but you should check with your broker or other nominee. See “The Distribution—When and How You Will Receive Tribune Publishing Common Stock.”
As a result of the distribution, 98.5% of the outstanding shares of Tribune Publishing common stock will be distributed to Tribune stockholders and holders of Warrants. Immediately following the distribution, Tribune will own approximately                  shares of Tribune Publishing common stock and Tribune Publishing will be a separate public company. The shares of Tribune Publishing common stock will be distributed by book-entry only. Instead of stock certificates, each Tribune stockholder that was a record holder of Tribune shares or Warrants on the record date will receive a statement of such stockholder’s book-entry account for the shares of Tribune Publishing common stock distributed to such stockholder. We expect that account statements reflecting ownership of the shares of Tribune Publishing common stock will be mailed shortly after the distribution date. Shares of Tribune Publishing common stock should be credited on or about         , 2014 to accounts with brokers or nominees of Tribune stockholders and warrantholders that are not record holders on the record date.
Tribune Publishing Company was incorporated on November 21, 2013, and its principal executive offices are located at 435 North Michigan Avenue, Chicago, Illinois 60611.
Background of the Distribution
Tribune’s board of directors and management team evaluated a variety of strategic options intended to maximize shareholder value and position the company for long-term growth. These options included maintaining Tribune’s primary lines of business, broadcasting and publishing, as a single company, selling the publishing business to one or more potential buyers, and separating the broadcasting and publishing businesses into two distinct companies. In February 2013, Tribune retained financial advisors to assist it in analyzing its strategic options. As a result of this process, the Tribune board decided that the interests of Tribune and its shareholders would be best served by separating the broadcasting and publishing businesses into two distinct companies, subject to the satisfaction or waiver of certain conditions and the board of directors’ ongoing consideration of the transaction and its final approval. See “The Distribution—Conditions to the Distribution” for further discussion.
In connection with the distribution, Tribune will undertake the internal reorganization described below under “—Internal Reorganization.” Following the internal reorganization, Tribune will distribute 98.5% of the shares of Tribune Publishing common stock to its stockholders and warrantholders on a pro rata basis and retain a 1.5% ownership interest in Tribune Publishing. Following the distribution, Tribune Publishing will operate independently from Tribune. Tribune’s stockholders will not be required to vote to effectuate the distribution. Tribune’s stockholders will not have appraisal rights with regards to the distribution.
 
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The internal reorganization and, in turn, the distribution, are subject to the satisfaction, or waiver by Tribune, of a number of conditions. Additionally, Tribune may determine not to complete the internal reorganization or the distribution if, at any time, the board of directors of Tribune determines, in its sole discretion, that the distribution is not in the best interest of Tribune or its stockholders or is otherwise not advisable.
On Aug. 23, 2013, Tribune submitted a request to the IRS for the IRS Ruling confirming the tax-free nature of the distribution. On Mar. 7, 2014, the IRS issued the IRS Ruling. See “—Material U.S. Federal Income Tax Consequences of the Distribution.”
Reasons for the Distribution
The board of directors and management of Tribune believe that the distribution is in the best interests of Tribune and its stockholders. Tribune believes that the distribution will enhance value for Tribune stockholders and give Tribune Publishing the financial and operational flexibility to take advantage of opportunities in the newspaper sector and meet the changing needs of the media marketplace today and in the future. The board of directors and management of Tribune considered the following potential benefits in making its determination to effect the distribution:
 
 	—  	 	allowing each of Tribune and Tribune Publishing to focus on its respective core business;	
 
 	—  	 	relieving certain regulatory restrictions, including FCC restrictions on the ability of either Tribune or Tribune Publishing to enter into certain markets as a result of current cross-ownership restrictions;	
 
 	—  	 	enhancing the effectiveness of Tribune and Tribune Publishing’s equity-linked compensation to more closely align the interests of management and employees of each of Tribune and Tribune Publishing with their respective stockholders;	
 
 	—  	 	facilitating future acquisitions and creating more attractive acquisition currencies for both Tribune and Tribune Publishing;	
 
 	—  	 	optimizing the capital structure and leverage level for the distinctive business profile of each of Tribune and Tribune Publishing; and	
 
 	—  	 	facilitating a potential future public offering of Tribune.	
In determining whether to pursue the distribution, Tribune’s board of directors considered the costs and risks associated with the transaction, including the cost associated with preparing Tribune Publishing to become an independent public company, including the dedication of sufficient resources to replicate certain technology applications and hardware, infrastructure and personnel, the time and effort required by this transaction from Tribune’s and Tribune Publishing’s management and the potential diversion of their attention away from their respective businesses and the loss of scale from operating as a single company. Notwithstanding these costs and risks, and taking into account the factors discussed above, Tribune’s board of directors determined that the distribution was the most attractive alternative to enhance stockholder value.
Tribune’s board of directors considered the incurrence of indebtedness to fund a cash dividend to Tribune as neither a positive or negative factor in making its determination to pursue the distribution. However, as Tribune currently has a level of debt which is supported in part by the operations of Tribune Publishing, the board of directors and management of Tribune determined that the incurrence of debt at Tribune Publishing and payment of a cash dividend to Tribune with a portion of the proceeds thereof was prudent as a way to set the post-distribution capitalization structure of both companies in a way the board of directors of Tribune felt was in the best interests of both businesses and Tribune shareholders.
 
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Internal Reorganization
The separation and distribution agreement will provide for the transfers of entities and related assets and liabilities so that as of the distribution date Tribune will retain the entities associated with Tribune’s broadcasting business and Tribune Publishing will hold the entities associated with the publishing business, including the Los Angeles Times , the Chicago Tribune , the Sun Sentinel, serving southeast Florida, the Orlando Sentinel , The Baltimore Sun , the Hartford Courant , The Morning Call, serving Pennsylvania’s Lehigh Valley, and the Daily Press , serving the Virginia Peninsula.
Following the distribution, Tribune will continue to own Tribune’s broadcasting and other businesses, including its equity interests in Classified Ventures, CareerBuilder and the Television Food Network, and its portfolio of real estate assets. Tribune is also expected to retain most of its pension assets and liabilities. We may experience increased costs following the distribution or be unable to operate profitably after becoming a stand-alone company. See “Risk Factors—Risks Relating to the Distribution.”
Manner of Effecting the Distribution
The general terms and conditions relating to the distribution will be set forth in an agreement between Tribune Publishing and Tribune, which we refer to as the “separation and distribution agreement.” See “Relationships Between Tribune and Tribune Publishing Following the Distribution—Separation and Distribution Agreement.”
Tribune will transfer to Tribune Publishing all of its assets, liabilities and businesses primarily related to Tribune’s publishing operations (which we refer to collectively as the contribution). In exchange for the contribution, Tribune Publishing will:
 
 	—  	 	issue to Tribune approximately                  shares of Tribune Publishing common stock; and	
 
 	—  	 	transfer to Tribune up to $275 million in cash from a portion of the proceeds of the Senior Term Loan Facility we anticipate arranging prior to the distribution, which we refer to as the special cash payment.	
After the contribution, Tribune will spin off Tribune Publishing to the holders of common stock and Warrants of Tribune by distributing 98.5% of the shares of Tribune Publishing common stock to Tribune stockholders and warrantholders on a pro rata basis, which we refer to as the distribution.
As a result of the distribution, Tribune Publishing will become an independent public company, although Tribune Publishing will continue to have a number of significant commercial and operational arrangements with Tribune and Tribune will continue to hold a 1.5% stake in Tribune Publishing for a period of up to five years following the distribution. We have applied to list Tribune Publishing common stock on the New York Stock Exchange under the symbol “TPUB”.
Holders of Tribune common stock and Warrants will receive 0.25 of a share of Tribune Publishing common stock for every share of Tribune common stock or Warrant, respectively, owned on the record date for the distribution.
Based on the number of Tribune shares and Warrants outstanding on the record date and the distribution ratio, approximately          shares of Tribune Publishing common stock will be distributed to Tribune stockholders and holders of Warrants. The shares of Tribune Publishing common stock to be distributed will constitute 98.5% of the outstanding shares of Tribune Publishing common stock. Immediately following the distribution, Tribune will own 1.5% of the outstanding shares of Tribune Publishing common stock, and Tribune Publishing will be a separate public company.
 
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When and How You Will Receive Tribune Publishing Common Stock
Tribune will use a book-entry system to distribute shares of Tribune Publishing common stock. No stock certificates will be issued for Tribune Publishing shares. Following the distribution, each record holder of Tribune common stock on the record date will receive from the distribution agent a statement of the amount of shares of Tribune Publishing common stock credited to his or her account. If you are not a record holder of Tribune common stock on the record date because your shares are held on your behalf by your broker or other nominee, your shares of Tribune Publishing common stock should be credited to your account with your broker or nominee on or about         , 2014.
No Tribune stockholder will be required to pay any cash or other consideration for shares of Tribune Publishing common stock received in the distribution, or to surrender or exchange Tribune shares in order to receive shares of Tribune Publishing common stock. No vote of Tribune stockholders is required or sought in connection with the distribution, and Tribune stockholders will have no appraisal rights in connection with the distribution.
In order to receive shares of Tribune Publishing common stock in the distribution, Tribune stockholders must have been stockholders as of 5:00 p.m., Eastern Time, on the record date.
Treatment of Warrants
Pursuant to the Warrant Agreement, holders of Warrants are entitled to receive a pro rata distribution concurrently with the distribution of Tribune Publishing common stock to holders of common stock of Tribune. Accordingly, in the distribution, holders of Warrants will receive 0.25 of a share of Tribune Publishing common stock for every Tribune Warrant owned on the record date for the distribution.
The Warrants will remain outstanding with the same terms and conditions, including an exercise price of $0.001 per share of Tribune common stock, subject to adjustment in accordance with the terms of the Warrant Agreement.
Treatment of Fractional Shares
The transfer agent will not deliver any fractional shares of Tribune Publishing common stock in connection with the distribution. Instead, at the transfer agent’s sole discretion, the transfer agent will aggregate all fractional shares and sell them on behalf of those holders who otherwise would be entitled to receive a fractional share. The transfer agent will determine in its sole discretion when, how and through which broker-dealers and at what price to sell aggregated fractional shares. We anticipate that these sales will occur as soon as practicable after the distribution date. Those holders will then receive a cash payment, in the form of a check, in an amount equal to their pro rata share of the total proceeds of those sales. Any applicable expenses, including brokerage fees, will be paid by us. It is expected that all fractional shares held in street name will be aggregated and sold by brokers or other nominees according to their standard procedures. You should contact your broker or other nominee for additional details.
None of Tribune, Tribune Publishing and the transfer agent will guarantee any minimum sale price for the fractional shares of Tribune Publishing common stock. Neither Tribune Publishing nor Tribune will pay any interest on the proceeds from the sale of fractional shares. The receipt of cash in lieu of fractional shares will generally be taxable to the recipient stockholders. See “The Distribution—Material U.S. Federal Income Tax Consequences of the Distribution.”
Results of the Distribution
After the distribution, Tribune Publishing will be a separate public company operating the publishing business. Immediately after the distribution, Tribune Publishing expects to have approximately          shares of
 
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common stock outstanding based on the outstanding Tribune shares and Warrants on the record date and the distribution ratio of 0.25 of a share of Tribune Publishing common stock for every share of Tribune common stock and for every Warrant. The distribution will not affect the number of outstanding Tribune shares or Warrants or any rights of Tribune stockholders or warrantholders.
Trading Prior to the Distribution Date
We anticipate that a “when-issued” market in Tribune Publishing common stock will develop prior to the distribution date. In the context of the distribution, when-issued trading refers to a securities transaction made conditionally on or before the distribution date because the securities are not yet available. When-issued trades generally settle within four trading days after the distribution date. If you own shares of Tribune’s common stock or Warrants on the record date, you will be entitled to receive shares of Tribune Publishing common stock in the distribution. Once a “when-issued” market develops, you may trade this entitlement to receive shares of Tribune Publishing common stock, without the shares of Tribune’s common stock you own. On the first trading day following the distribution date, we expect that “when-issued” trading of Tribune Publishing common stock will end and “regular-way” trading will begin on the New York Stock Exchange. Regular-way trading typically involves a trade that settles on the third full trading day following the date of the securities transaction. If the distribution does not occur, all when-issued trades in Tribune Publishing common stock will not be settled and therefore will be null and void.
In addition, prior to the distribution date, two markets may develop in Tribune’s common stock and Warrants: a “due-bills” market and an “ex-distribution” market. Shares of Tribune’s common stock and Warrants that trade on the due-bills market will trade with an entitlement to receive shares of Tribune Publishing common stock in the distribution, and such trades will generally settle within four trading days after the distribution date. Shares and Warrants that trade on the ex-distribution market will trade without an entitlement to receive shares of Tribune Publishing common stock in the distribution, and such trades will generally settle on a regular-way basis. Therefore, if you sell shares of Tribune’s common stock or Warrants in the due-bills market up through the distribution date, you will be selling your right to receive shares of Tribune Publishing common stock in the distribution. However, if you own shares of Tribune’s common stock or Warrants on the record date and sell those shares in the ex-distribution market up through the distribution date, you will still be entitled to receive shares of Tribune Publishing common stock in the distribution. If the distribution does not occur, all “due-bills” trades in Tribune’s common stock and Warrants will not be settled and therefore will be null and void.
Listing and Trading of the Shares of Tribune Publishing Common Stock
As of the date of this information statement, we are a wholly-owned subsidiary of Tribune and, accordingly, there is currently no public market for our common stock, although a “when-issued” market in our common stock may develop prior to the distribution. See “—Trading Prior to the Distribution Date” above for an explanation of a “when-issued” market. We have applied to list our shares of common stock on the New York Stock Exchange under the symbol “TPUB”.
We cannot assure you as to the price at which our common stock will trade before, on or after the distribution date, and the price at which such stock trades may fluctuate significantly. In addition, the combined trading prices of Tribune’s Class A common stock, Class B common stock or Warrants and Tribune Publishing’s common stock following the distribution may be less than, equal to or greater than the current trading price of Tribune’s Class A common stock, Class B common stock or Warrants, as the case may be. See “Risk Factors— Risks Relating to our Common Stock and the Securities Market.”
Shares of Tribune Publishing common stock distributed to Tribune’s stockholders will be freely transferable, except for such shares that are distributed to persons who are considered our affiliates. Individuals or entities may be deemed to be affiliates of Tribune Publishing if they control, are controlled by, or are under common control with, Tribune Publishing, as those terms generally are interpreted for federal securities law
 
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purposes. These persons may include certain or all of our directors, officers, and significant stockholders. In addition, individuals who are affiliates of Tribune on the distribution date may be deemed to be affiliates of Tribune Publishing. Individuals who are our affiliates, or are deemed our affiliates, will be permitted to sell their shares of Tribune Publishing common stock only pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), or an exemption from the registration requirements of the Securities Act, such as those afforded by Section 4(a)(1) of the Securities Act or Rule 144 thereunder.
Material U.S. Federal Income Tax Consequences of the Distribution
The following discusses the material United States federal income tax consequences of the distribution. This discussion is based on the IRC, the Treasury regulations promulgated under the IRC, and interpretations of the IRC and the Treasury regulations by the courts and the IRS, all as they exist as of the date hereof and all of which are subject to change, possibly with retroactive effect. This is not a complete discussion of all of the tax consequences of the distribution. In particular, it may not address United States federal income tax considerations applicable to Tribune stockholders and warrantholders subject to special treatment under United States federal income tax law, such as financial institutions, dealers in securities, traders in securities who elect to apply a mark-to-market method of accounting, insurance companies, tax-exempt entities, partnerships and other pass-through entities, stockholders and warrantholders who hold their shares as part of a “hedge,” “straddle,” “conversion” or “constructive sale” transaction, stockholders and warrantholders who are subject to the alternative minimum tax and stockholders and warrantholders who acquired their shares or warrants upon the exercise of employee stock options or otherwise as compensation. In addition, this discussion is limited to stockholders and warrantholders that hold their Tribune common stock or Warrants as a capital asset. Finally, this discussion does not address any estate, gift or other non-income tax consequences or any state, local or foreign tax consequences.
This discussion is limited to stockholders and warrantholders of Tribune that are United States holders. A United States holder is a beneficial owner of Tribune stock or Warrants, other than an entity or arrangement treated as a partnership for United States federal income tax purposes, that is, for United States federal income tax purposes:
 
 	—  	 	an individual who is a citizen or a resident of the United States;	
 
 	—  	 	a corporation, or other entity taxable as a corporation for United States federal income tax purposes, created or organized in or under the laws of the United States, any state thereof or the District of Columbia;	
 
 	—  	 	an estate, the income of which is subject to United States federal income taxation regardless of its source; or	
 
 	—  	 	a trust, if (i) a court within the United States is able to exercise primary jurisdiction over its administration and one or more United States persons have the authority to control all of its substantial decisions, or (ii) in the case of a trust that was treated as a domestic trust under the law in effect before 1997, a valid election is in place under applicable Treasury regulations.	
Tribune stockholders and warrantholders are urged to consult their own tax advisors regarding the tax consequences of the distribution to them, including the effects of United States federal, state, local, foreign and other tax laws.
Tribune has received the IRS Ruling, which is to the effect that the distribution and certain related transactions will qualify as tax-free to Tribune, Tribune Publishing and the Tribune stockholders and warrantholders for U.S. federal income tax purposes. Although a private letter ruling from the IRS generally is binding on the IRS, the IRS Ruling does not rule that the distribution satisfies every requirement for a tax-free distribution, and the parties will rely solely on the opinion of counsel described below for comfort that such
 
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additional requirements are satisfied. In particular, the IRS Ruling does not rule that the distribution satisfies the following requirements for a tax-free distribution: (i) whether the distribution is being carried out for one or more corporate business purposes, (ii) whether the distribution is used principally as a device for the distribution of earnings and profits of Tribune or Tribune Publishing or both and (iii) whether the distribution and any subsequent acquisition by one or more persons of a 50-percent or greater interest in Tribune or Tribune Publishing are part of a plan (or series of related transactions).
The distribution is conditioned upon Tribune’s receipt of the opinion of Debevoise & Plimpton LLP, Tribune’s special tax counsel, to the effect that the distribution and certain related transactions will qualify as tax-free to Tribune and the stockholders and warrantholders of Tribune. The opinion of Tribune’s special tax counsel is expected to rely on the IRS Ruling as to matters covered by it.
The IRS Ruling is based on, and the opinion of Tribune’s special tax counsel will be based on, among other things, certain representations and assumptions as to factual matters made by Tribune and certain of the Tribune stockholders, including assumptions concerning Section 355(e) of the IRC as discussed below. The failure of any factual representation or assumption to be true, correct and complete in all material respects could adversely affect the validity of the IRS Ruling or opinion. An opinion of counsel represents counsel’s best legal judgment, is not binding on the IRS or the courts, and the IRS or the courts may not agree with the opinion. In addition, the IRS Ruling and the opinion of Tribune’s special tax counsel will be based on current law, and cannot be relied on if current law changes with retroactive effect.
The IRS Ruling concludes and the opinion of Tribune’s special tax counsel is expected to conclude that:
 
 	1.	the contribution by Tribune to Tribune Publishing of assets of the Tribune Publishing business and related liabilities in exchange for shares of Tribune Publishing common stock and receipt by Tribune of the special cash payment, followed by the distribution of the Tribune Publishing common stock in the distribution, will qualify as a reorganization within the meaning of Section 368(a)(1)(D) of the IRC, and Tribune and Tribune Publishing will each be a party to a reorganization within the meaning of Section 368(b) of the IRC;	
 
 	2.	no gain or loss will be recognized by Tribune on the contribution or the distribution under Section 361 of the IRC provided that (i) the cash received by Tribune does not exceed the amount of Tribune’s tax basis in the assets contributed to Tribune Publishing (less liabilities assumed) and (ii) the special cash payment is distributed in pursuance of the plan of reorganization;	
 
 	3.	no gain or loss will be recognized by stockholders or warrantholders of Tribune on the receipt of the Tribune Publishing common stock in the distribution under Section 355(a)(1) of the IRC, except for holders of Tribune restricted stock who have not made a valid election under Section 83 of the IRC;	
 
 	4.	each Tribune stockholder’s and warrantholder’s holding period in the Tribune Publishing common stock received in the distribution will include the holding period of the Tribune common stock or Warrant with respect to which the distribution of the Tribune Publishing common stock is made; and	
 
 	5.	each Tribune stockholder’s and warrantholder’s basis in a share of Tribune Publishing common stock or Warrant will be allocated between the share of Tribune common stock with respect to which the distribution of the Tribune Publishing common stock is made and the share of Tribune Publishing common stock (or allocable portions thereof) received with respect to such share of Tribune common stock or warrant in proportion to their fair market values.	
 
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If the distribution does not qualify as a tax-free distribution under Section 355 of the IRC, each Tribune stockholder and warrantholder who receives Tribune Publishing common stock would be treated as receiving a taxable dividend in an amount equal to the fair market value of the Tribune Publishing stock received, to the extent of such stockholder’s or warrantholder’s ratable share of Tribune’s earnings and profits.
In addition, if the distribution does not qualify under Section 355 of the IRC, Tribune would have taxable gain equal to the excess of the value of the assets transferred to Tribune Publishing plus liabilities assumed by Tribune Publishing over Tribune’s tax basis for those assets. Even if the distribution otherwise qualifies as a tax-free distribution under Section 355 of the IRC, the distribution will be taxable to Tribune pursuant to Section 355(e) of the IRC if there is a 50% or more change in ownership of either Tribune or Tribune Publishing, directly or indirectly, as part of a plan or series of related transactions that include the distribution. Section 355(e) might apply if acquisitions of stock of Tribune before or after the distribution, or of Tribune Publishing after the distribution, are considered to be part of a plan or series of related transactions that include the distribution. In connection with the request for the IRS Ruling, Tribune has represented and in connection with the opinion of Tribune’s special tax counsel, Tribune will represent, that the distribution is not part of any such plan or series of related transactions. If Section 355(e) of the IRC applied, Tribune might recognize a very substantial amount of taxable gain.
Each Tribune stockholder and warrantholder that receives cash in lieu of fractional shares will recognize gain or loss on such shares computed based on the difference between the cash so received and such stockholder’s or warrantholder’s basis in such fractional shares (computed as described above).
Under the tax matters agreement, in certain circumstances, and subject to certain limitations, Tribune Publishing will be required to indemnify Tribune for taxes on the distribution that arise as a result of actions or failures to act by Tribune Publishing, or as a result of changes in ownership of the stock of Tribune Publishing after the distribution. See “Relationships Between Tribune and Tribune Publishing Following the Distribution—Tax Matters Agreement.”
In some cases however, Tribune might recognize gain on the distribution without being entitled to an indemnification payment under the tax matters agreement. Even if Section 355(e) of the IRC causes the distribution to be taxable to Tribune, the distribution will nevertheless remain tax-free to Tribune stockholders and warrantholders.
United States Treasury regulations require each Tribune equityholder that owns at least 1% of the total outstanding stock and/or warrants of Tribune and receives stock in the distribution to attach to its United States federal income tax return for the year in which the distribution occurs a detailed statement containing certain information relating to the tax-free nature of the distribution. Upon request, Tribune will provide holders of 1% or more of its outstanding stock or Warrants who received Tribune Publishing stock in the distribution with any pertinent information that is in Tribune’s possession and is reasonably available, to the extent necessary to comply with that requirement.
Conditions to the Distribution
We expect that the distribution will be effective on the distribution date, provided that the following conditions have been satisfied or waived by Tribune:
 
 	—  	 	the approval by the board of directors of Tribune of the distribution and all related transactions (and such approval not having been withdrawn);	
 
 	—  	 	the completion of the internal reorganization, the contribution by Tribune to Tribune Publishing of all of the assets, liabilities and businesses primarily related to Tribune’s publishing operations as described herein, entry into the Senior Credit Facilities and the payment of the cash dividend to Tribune;	
 
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 	—  	 	Tribune’s receipt of the opinion of Tribune’s special tax counsel in a form satisfactory to Tribune in its sole discretion, to the effect that, among other things, subject to the accuracy of and compliance with certain representations, assumptions and covenants, the contribution of the assets constituting Tribune’s publishing business to us and the distribution will qualify for non-recognition of gain or loss to Tribune, Tribune Publishing and their respective stockholders, warrantholders and subsidiaries under Sections 368, 355 and 361 of the IRC except to the extent of cash received in lieu of fractional shares, and the IRS Ruling regarding the tax-free status of the distribution shall not have been revoked or materially amended;	
 
 	—  	 	no order, injunction or decree that would prevent the consummation of the distribution will be threatened, pending or issued (and still in effect) by any governmental entity of competent jurisdiction and no other legal restraint or prohibition preventing consummation of the distribution will be in effect;	
 
 	—  	 	no events or developments having occurred prior to the distribution that, in the judgment of the board of directors of Tribune, would result in the distribution having a material adverse effect on Tribune or its stockholders;	
 
 	—  	 	Tribune’s and Tribune Publishing’s execution of the separation and distribution agreement, the tax matters agreement, the transition services agreement, the employee matters agreement and all other agreements relating to the distribution;	
 
 	—  	 	the SEC having declared effective the Form 10, of which this information statement forms a part;	
 
 	—  	 	our common stock having been approved for listing on a national securities exchange;	
 
 	—  	 	all actions and filings necessary or appropriate under applicable U.S. federal, U.S. state or other securities laws and any other necessary and applicable consents having been taken, obtained and, where applicable, having become effective or been accepted;	
 
 	—  	 	this information statement having been delivered to Tribune’s stockholders and warrantholders;	
 
 	—  	 	the appointment or election, as applicable, of the individuals to be listed as officers and directors of Tribune Publishing post-distribution, as described in this information statement, on or prior to the distribution date;	
 
 	—  	 	Tribune having established the record date for the distribution; and	
 
 	—  	 	our amended and restated certificate of incorporation and amended and restated by-laws, each in substantially the form filed with the Form 10, having become effective at or prior to the distribution.	
The fulfillment of the above conditions will not create any obligation on Tribune’s part to effect the distribution. Tribune, in its sole and absolute discretion, will determine the terms of, and whether to proceed with, the distribution and, to the extent it determines to proceed, determine the record date and distribution date.
Regulatory Approval
Apart from the registration under United States federal securities laws of the Tribune Publishing common stock to be distributed in the distribution and related stock exchange listing requirements, we do not believe that any other material governmental or regulatory filings or approvals will be necessary to consummate the distribution. The distribution will not affect the ownership or control of Tribune’s television stations or its
 
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television licensee subsidiaries; consequently, FCC approval will not be required in connection with the distribution with respect to any of the television station licenses. FCC consent will be required with respect to the transfer to Tribune Publishing of certain private business radio licenses associated with newspaper operations.
No Appraisal Rights
Under the DGCL, Tribune stockholders will not have appraisal rights in connection with the distribution.
 
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 RELATIONSHIPS BETWEEN TRIBUNE AND TRIBUNE PUBLISHING FOLLOWING THE DISTRIBUTION
For purposes of governing the separation of Tribune Publishing from Tribune as well as certain of the ongoing relationships between Tribune and Tribune Publishing after the distribution, Tribune Publishing will enter into the agreements with Tribune described in this section. The forms of agreements summarized in this section are included as exhibits to the registration statement on Form 10 that relates to this information statement and filed with the SEC. The following summaries are qualified in their entirety by reference to the agreements as filed. See “Where You Can Find More Information.”
Separation and Distribution Agreement
The separation and distribution agreement will contain the key provisions relating to the separation of Tribune Publishing and the publishing business from that of Tribune and the distribution of 98.5% of the shares of Tribune Publishing common stock to holders of Tribune common stock and Warrants entitled to such distribution, as described under “The Distribution.” The separation and distribution agreement will identify the assets to be transferred to, and the liabilities and contracts to be assumed by, Tribune Publishing or Tribune, as applicable, in the distribution, and describe when and how these transfers and assumptions will occur. It will also include procedures by which Tribune and Tribune Publishing will become separate companies. In addition, it will contain the conditions that must be satisfied, or waived by Tribune, prior to the separation and the completion of the distribution. In addition, we will enter into a transition services agreement and various other agreements with Tribune governing various interim and ongoing relationships between Tribune Publishing and Tribune following the distribution date. These ancillary agreements include the following:
 
 	—  	 	transition services agreement,	
 
 	—  	 	tax matters agreement,	
 
 	—  	 	employee matters agreement and	
 
 	—  	 	other agreements with respect to intellectual property.	
Tribune and Tribune Publishing intend to execute the separation and distribution agreement and the ancillary agreements on or before the distribution date.
Internal Reorganization and Contribution
The separation and distribution agreement will provide for the transfers of entities and certain related assets and liabilities so that as of the distribution date (i) Tribune Publishing will hold the entities and related assets and liabilities associated with the publishing business, including the Los Angeles Times , the Chicago Tribune , the Sun Sentinel , serving southeast Florida, the Orlando Sentinel , The Baltimore Sun , the Hartford Courant , The Morning Call , serving Pennsylvania’s Lehigh Valley, and the Daily Press , serving the Virginia Peninsula, and (ii) Tribune will retain the entities and related assets and liabilities associated with Tribune’s broadcasting and other businesses, including its equity interests in Classified Ventures, CareerBuilder and the Television Food Network, and its portfolio of real estate assets. Tribune Publishing is currently a wholly-owned subsidiary of Tribune. Prior to the distribution, Tribune will undertake a series of internal reorganization transactions to facilitate the transfers of the assets to, and the assumption of liabilities and contracts by, Tribune Publishing or Tribune, as applicable.
Financing and Cash Distribution
The separation and distribution agreement will provide that, subject to the terms and conditions contained in the agreement, immediately prior to the distribution, Tribune Publishing will enter into the Senior Term Loan Facility and will pay a cash dividend to Tribune of up to $275 million from the proceeds of the Senior Term Loan Facility.
 
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Conditions to the Distribution
The separation and distribution agreement will provide that the distribution is subject to the satisfaction (or waiver by Tribune) of a number of conditions as discussed under “The Distribution—Conditions to the Distribution.”
The separation and distribution agreement will provide that the fulfillment of the conditions to the distribution will not create any obligation on Tribune’s part to effect the distribution. Tribune, in its sole and absolute discretion, will determine the terms of, and whether to proceed with, the distribution and, to the extent it determines to proceed, determine the record date and distribution date. See “The Distribution—Conditions to the Distribution” for additional details.
Representations and Warranties
In general, neither Tribune Publishing nor Tribune will make any representations or warranties to each other regarding any assets or liabilities transferred or assumed, any consents or approvals that may be required in connection with these transfers or assumptions, the value or freedom from any lien or other security interest of any assets transferred, the absence of any defenses relating to any claim of either party or the legal sufficiency of any conveyance documents. Except as expressly set forth in the separation and distribution agreement, all assets will be transferred on an “as is,” “where is” basis.
Intercompany Arrangements
All intercompany accounts payable or accounts receivable, between Tribune or one of its non-Tribune Publishing subsidiaries, on the one hand, and Tribune Publishing or one of its subsidiaries after giving effect to the distribution, on the other hand, will be settled as of the distribution. Certain agreements, arrangements, commitments and understandings between Tribune or one of its non-Tribune Publishing subsidiaries, on the one hand, and Tribune Publishing or one of its subsidiaries following the contribution, on the other hand, will continue after the distribution through the entry into the separation and distribution agreement, the transition services agreement, the tax matters agreement, and all other agreements entered into in connection with the separation and distribution agreement, except as specified in such agreements and arrangements.
Mutual Releases and Indemnification
Pursuant to the separation and distribution agreement, effective as of the distribution date, Tribune and Tribune Publishing will release and discharge each other, and certain related parties, from all liabilities existing or arising from acts and events occurring, or failing to occur (or alleged to have occurred or to have failed to occur), and all conditions existing (or alleged to have existed) on or before the distribution date, other than, among other things, liabilities provided in or resulting from continuing agreements between Tribune and Tribune Publishing, including the separation and distribution agreement.
Subject to certain exceptions, Tribune Publishing has agreed to indemnify Tribune and certain persons related to Tribune from and against any and all damages, losses, liabilities, and expenses relating to, arising out of, or resulting from, among other things:
 
 	—  	 	the publishing business and the assets and liabilities of Tribune Publishing and its subsidiaries after giving effect to the distribution;	
 
 	—  	 	Tribune Publishing’s failure or the failure of certain related persons to discharge any liability of Tribune Publishing and its subsidiaries after giving effect to the distribution or any obligation arising out of the publishing business or its assets; and	
 
 	—  	 	a breach by Tribune Publishing of the separation and distribution agreement or the various ancillary agreements described in this information statement.	
 
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Subject to certain exceptions, Tribune has agreed to indemnify Tribune Publishing and certain persons related to Tribune Publishing from and against any and all damages, losses, liabilities, and expenses relating to, arising out of, or resulting from, among other things:
 
 	—  	 	Tribune’s business (excluding the publishing business) and the assets and liabilities of Tribune and its non-Tribune Publishing subsidiaries;	
 
 	—  	 	Tribune’s failure or the failure of certain related persons to discharge any liability of Tribune and its non-Tribune Publishing subsidiaries or any obligation arising out of the operation of Tribune’s business after giving effect to the distribution; and	
 
 	—  	 	a breach by Tribune of the separation and distribution agreement or the various ancillary agreements described in this information statement.	
None of these indemnities apply to indemnification for income tax liabilities, which are addressed in the tax matters agreement described below under “Tax Matters Agreement,” or for indemnification matters specifically covered in any other agreement. The separation and distribution agreement includes procedures for notice and payment of indemnification claims and, generally, provides that the indemnifying party may assume the defense of a claim or suit brought by a third party. Any indemnification amount paid under the indemnities will be paid net of the amount of any insurance or other amounts that would be payable by any third party to the indemnified party in the absence of the indemnity. In addition, the separation and distribution agreement provides that if indemnification is unavailable or insufficient to hold the indemnified party harmless, the indemnifying party will contribute to the amount paid or payable in a manner appropriate to reflect all relevant equitable considerations.
Further Assurances
On and after the distribution date, Tribune and Tribune Publishing shall cooperate to consummate the transactions contemplated by the separation and distribution agreement and the ancillary agreements.
Access to Information; Provision of Witnesses; Confidentiality
Pursuant to the separation and distribution agreement, Tribune Publishing and Tribune will agree to grant each other and their specified representatives reasonable access to all records in their possession relating to the business and affairs of the other party as reasonably required. Access will be allowed for such purposes as audit, accounting, litigation, disclosure reporting, and regulatory compliance. Each party will also agree to use reasonable efforts to make available to the other party and its accountants, counsel, and other designated representatives, upon written request, its directors, officers, employees, and representatives as witnesses and otherwise cooperate with the other party in connection with any third party proceeding. Subject to limited exceptions, Tribune Publishing, Tribune, and their respective directors, officers, employees, agents, consultants, and advisors will be required to hold in strict confidence all information in its or their possession concerning the other party.
Termination
At any time prior to the distribution, Tribune may terminate the separation and distribution agreement without the prior approval of any person, including Tribune Publishing.
Transition Services Agreement
In connection with the distribution, we expect to enter into a transition services agreement with Tribune, pursuant to which Tribune will provide us with certain specified services on a transitional basis, including in such areas as human resources, risk management, treasury, technology support, legal, real estate, procurement, internal audit, and advertising and marketing in a single market, and other areas where we may need assistance and
 
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support following the distribution. In addition, the transition services agreement will outline the services that we will provide Tribune on a transitional basis, including in areas such as human resources, technology support, legal, procurement, internal audit, accounting, digital advertising operations, and advertising, marketing, event management and fleet maintenance in a single market, and other areas where Tribune may need assistance and support following the distribution. The charges for the transition services generally allow the providing company to fully recover all out-of-pocket costs and expenses it actually incurs in connection with providing the services, plus, in some cases, the allocated direct costs of providing the services, generally without profit.
The services will generally be provided for a term beginning on the distribution date and expiring on the earlier to occur of the second anniversary of the distribution date and the date of termination of a particular service pursuant to the agreement. The party receiving a service can generally terminate provision of that service upon 30 days advance notice to the party providing the service and payment of applicable early termination charges.
Tax Matters Agreement
In connection with the distribution, we expect to enter into a tax matters agreement, which will govern the respective rights, responsibilities and obligations of Tribune and Tribune Publishing after the distribution with respect to taxes, including Tribune’s and Tribune Publishing’s obligations to file tax returns and remit taxes, control over tax contests and Tribune’s and Tribune Publishing’s obligations to cooperate after the distribution in tax return preparation and record-keeping matters.
The tax matters agreement generally provides that Tribune will be responsible for all taxes (other than taxes on the distribution and related transactions) for periods before the distribution that are reportable on any tax return that includes Tribune or one of its non-Tribune Publishing subsidiaries, and Tribune Publishing or one of its subsidiaries Tribune Publishing will be responsible for all such taxes reportable on any tax return that includes Tribune Publishing or its subsidiaries but does not include any non-Tribune Publishing subsidiaries. Tribune will retain responsibility for all taxes relating to the formation of and its ongoing investment in Newsday Holdings LLC.
The tax matters agreement further provides that Tribune Publishing and certain Tribune Publishing subsidiaries will indemnify Tribune for (i) taxes on the distribution and related transactions resulting from (A) any of their actions (or failures to take certain actions) that disqualify the distribution and related transactions as tax-free or (B) any issuance of stock by Tribune Publishing or any of its affiliates or change in ownership of any such entities (other than changes in ownership solely caused by Tribune) that would cause Section 355(d), Section 355(e) or Section 355(f) of the IRC to apply to the distribution, (ii) taxes on the distribution and related transactions resulting from the disqualification of the distribution due to breaches by Tribune Publishing of representations and covenants and (iii) taxes of Tribune Publishing attributable to the Tribune Publishing business for which Tribune is not otherwise responsible and that are not related to the distribution or any related transaction. The indemnification requirement under clauses (i)(A) and (ii) does not extend to taxes related to the distribution and related transactions that would have been imposed or incurred in the absence of any event described in those clauses. Tribune will indemnify Tribune Publishing for (i) the taxes of Tribune and (ii) taxes of Tribune Publishing resulting from the distribution and related transactions unless, in each case, Tribune Publishing or the Tribune Publishing subsidiaries are otherwise responsible for such taxes as described above. However, if the distribution is taxable as a result of certain actions by both parties, the liability for such taxes is shared equally between Tribune and Tribune Publishing.
All parties to the tax matters agreement have agreed to report the distribution and certain related transactions as tax-free. Tribune Publishing has agreed to adhere to Tribune’s determination of the tax basis of the Tribune Publishing assets and the value of any tax attribute, such as a net operating loss carryover, absent a final determination to the contrary or manifest error.
To preserve the tax-free status of the distribution, the tax matters agreement provides for certain restrictions on Tribune Publishing’s ability to pursue strategic or other transactions. Additionally, Tribune
 
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Publishing has agreed not to take certain actions which could cause the distribution to be disqualified as a tax-free distribution, including: for two full years after the distribution, Tribune Publishing will not enter into any agreement, understanding or arrangement or any substantial negotiations involving the acquisition of stock of Tribune Publishing (including by Tribune Publishing or its subsidiaries) or a shift of ownership of Tribune Publishing, and will not issue additional shares of stock, modify any organizational document or transfer or modify any option, warrant or convertible instrument that is related to an equity interest in Tribune Publishing, other than certain issuances to service providers or with respect to a Tribune Publishing retirement plan as provided in an applicable “safe harbor” of the Treasury Regulations; for two years after the distribution, Tribune Publishing may not repurchase any stock except as allowed under an IRS revenue procedure; and for two years after the distribution, (a) the Tribune Publishing business must actively continue to operate and (b) Tribune Publishing will not dissolve, liquidate, merge or consolidate unless it is the survivor in a merger or consolidation. However, Tribune Publishing may engage in these activities (without limiting its indemnity obligations) if it receives an IRS ruling, Tribune’s consent or a legal opinion reasonably satisfactory to Tribune that the tax-free status of the distribution and certain related transactions will not be adversely affected.
Employee Matters Agreement
In connection with the distribution, Tribune Publishing and Tribune will enter into an employee matters agreement that will address the treatment of employees and former employees with respect to their participation in employee benefit plans that currently exist or that Tribune Publishing intends to establish in connection with the distribution, as well as certain other human resources matters relating to employee programs and labor contracts. The primary purpose of the employee matters agreement is to allocate responsibility for the employment-related liabilities associated with persons who have performed services for the two business segments and address the issues that may arise with regard to the provision of benefits and certain compensation to the employees of Tribune Publishing and Tribune in connection with their separation into two stand-alone companies.
The employee matters agreement will address the liabilities associated with the employment and employee benefits of current, former and retired employees whose principal services have been or, following the distribution, will be rendered to Tribune Publishing. The employee matters agreement will apply to matters relating to both non-union employees and those who are represented by unions. Tribune Publishing will retain all liabilities arising with respect to collective bargaining agreements applicable to current and former Tribune Publishing employees.
In general, under the employee matters agreement, except for certain pension matters, (i) Tribune Publishing and its subsidiaries will assume or retain all liabilities with respect to the employment of all of their employees and former employees (other than employees of discontinued businesses), including liabilities with respect to the participation in benefit plans prior to the distribution (e.g., health and welfare benefits, retiree medical and life insurance benefits, long-term disability benefits (except where the disability occurred prior to the distribution and is covered by an insured Tribune plan) and workers’ compensation claims), and (ii) Tribune and its subsidiaries will assume or retain all liabilities pertaining to other current and former employees, including liabilities arising with respect to benefit plans.
Notwithstanding the foregoing, Tribune will retain (or, where appropriate, assume) all liabilities relating to defined benefit pensions of both Tribune and Tribune Publishing employees, except for liabilities relating to Tribune Publishing employees’ participation in multiemployer pension plans. Tribune is currently the sponsor of predominantly frozen qualified single employer defined benefit plans under which many current and former employees of Tribune Publishing have an accrued benefit. The actuarially determined present value of the liabilities under such plans (as determined as of the most recent actuarial valuation of such plans) exceeded the fair market value of the assets of such plans (as determined as of December 31, 2013) by approximately $187 million. Tribune will remain the sponsor of such plans and, following the distribution, Tribune Publishing will have no obligation to make any further contributions to such plans. Additionally, immediately prior to the
 
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distribution, Tribune will assume The Baltimore Sun Company Retirement Plan for Mailers and The Baltimore Sun Company Employees’ Retirement Plan, which are frozen single employer defined benefit pension plans that have been maintained by Tribune Publishing for certain of its union-represented employees (the “Baltimore Sun Pension Plans”). The actuarially determined present value of the liabilities under the Baltimore Sun Pension Plans (as determined as of the most recent actuarial valuations of such plans) exceeded the fair market value of the assets of such plans (as determined as of Dec. 31, 2013) by approximately $12 million. Following the assumption of the Baltimore Sun Pension Plans, Tribune will be the sponsor of such plans and, following the distribution, Tribune Publishing will have no obligation to make any further contributions to either of the Baltimore Sun Pension Plans.
Subject to a transition period that is expected to run through the end of 2014 with respect to benefits under the Tribune health and welfare plans, after the distribution, Tribune Publishing will no longer be a participating employer in respect of any Tribune employee benefit plans, and Tribune Publishing’s continuing employees will receive no additional benefits under such Tribune plans. Through the end of the transition period, Tribune Publishing employees will receive benefits under the Tribune health and welfare plans and Tribune Publishing will bear the cost of this coverage with respect to its employees. Following the transition period, Tribune Publishing is expected to establish its own health and welfare plans for the benefit of the Tribune Publishing employees and retirees and other former employees eligible for continuing benefits.
Prior to the distribution, Tribune Publishing will establish tax qualified defined contribution plans for the benefit of its active employees. It is expected that Tribune Publishing will continue to sponsor such plans following the distribution.
The employee matters agreement also will describe the general treatment of outstanding equity awards of Tribune held by Tribune employees and Tribune Publishing employees. As of the distribution, stock options and restricted stock units will be outstanding under the Tribune Company 2013 Equity Incentive Plan. Following the distribution, outstanding Tribune equity awards held by Tribune employees will continue to be awards in respect of Tribune common stock, and outstanding Tribune equity awards held by Tribune Publishing employees will be converted into awards in respect of Tribune Publishing common stock. The converted awards for Tribune Publishing employees will be granted under the terms of the Tribune Publishing Company 2014 Omnibus Incentive Plan, which is being established in connection with the distribution.
Effective simultaneously with, and subject to, completion of the distribution, all outstanding Tribune equity awards will be adjusted in a manner intended to preserve the value of the Tribune awards by taking into account the relative values of Tribune’s common stock immediately prior to the distribution and, in the case of Tribune Publishing employees, Tribune Publishing’s common stock immediately following the distribution or, in the case of Tribune employees, Tribune’s common stock immediately following the distribution. In order to preserve the value of each stock option, the exercise price of the adjusted options will be modified as necessary to preserve the same ratio as existed prior to the distribution between the exercise price and the per share value of the underlying stock, and then the number of shares subject to the adjusted option will be increased or decreased so as to preserve the aggregate spread value in the option. Any resulting fractional shares will be cancelled.
Short-term incentive awards payable to Tribune and Tribune Publishing employees in respect of services in 2014 will be determined under performance criteria previously established. Each of Tribune and Tribune Publishing will determine for its employees the extent to which short-term incentives will be paid for services in 2014, both in respect of the period prior to and after the distribution.
The employee matters agreement will provide that, for the 12 month period following the distribution, neither Tribune nor Tribune Publishing may solicit the other’s employees, subject to specified customary exceptions.
 
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Intellectual Property Matters
In connection with the distribution, we expect to enter into a number of agreements with Tribune and, in certain cases, subsidiaries of Tribune, that will govern our relationship with Tribune related to certain intellectual property and other proprietary information we will have the right to use, under specified conditions, in the operation of our business following the distribution. The Intellectual Property License Agreement is expected to provide non-exclusive and royalty-free licenses to intellectual property (other than patents or trademarks) currently owned by either Tribune or Tribune Publishing and used by the other, such as internally developed software and know-how. The Trademark License Agreement is expected to provide a non-exclusive, royalty-free license from Tribune to Tribune Publishing to use certain trademarks, service marks and trade names, including the Tribune name. The Content Sharing Agreement is expected to provide royalty-free licenses to certain news and other content in a variety of media from Tribune to Tribune Publishing and from Tribune Publishing to Tribune. In addition, there may be other licenses from us to Tribune that we would not expect to be material to our business following the distribution.
Real Estate Matters
Tribune Real Estate Holdings, LLC (“Tribune Real Estate Holdings”), through its subsidiaries, holds title to all of the owned real property that is used in the operation of Tribune’s business, including the publishing business. Tribune Real Estate Holdings is a wholly-owned subsidiary of Tribune, and following the distribution, Tribune Real Estate Holdings will continue to be a wholly-owned subsidiary of Tribune.
Each subsidiary of Tribune Real Estate Holdings which owns a property that is used by Tribune Publishing is party to a lease agreement with the relevant Tribune Publishing entity with respect to such property. Each lease contains arm’s-length terms, which were determined based on the recommendations of an independent licensed real estate appraiser. In preparing its recommendations, for each property owned by Tribune Real Estate Holdings, the licensed appraiser prepared a market rent valuation report incorporating the pertinent data, methodology and calculations leading to the value conclusion. Each property was inspected, and information was collected from the owner, public records, and market data with respect to physical and economic factors relevant to the valuation process. The methodology used to complete the market rent estimate consisted of a comparison of similar facilities leased or available for lease, and the report includes discussion and analysis of comparable rental properties with photographs and maps. In each report, the licensed appraiser certified that the reported analyses, opinions and conclusions were developed, and the report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice and the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. These lease arrangements will continue, according to their respective terms, following the distribution.
There are 15 net leases for Tribune Publishing’s industrial facilities which include printing plants, distribution facilities and related office space. For printing plants the initial lease term is 10 years with two options to renew for additional 10 year terms. For distribution facilities, the initial lease term is 5 years with either two options to renew for additional 5 year terms or two options to renew for additional 10 year terms. Under the net leases, the rent is net of taxes, insurance and operating expenses, and the tenant is responsible for repairs and maintenance.
The leases for Tribune Tower in Chicago and Los Angeles Times Square, both of which are large multi-tenant buildings, are gross leases which provide for professional management of the building. At Tribune Tower, Tribune Publishing leases approximately 306,000 square feet, while at Los Angeles Times Square, Tribune Publishing leases approximately 242,000 square feet. The gross leases provide for an initial term of 5 years with renewal options for up to two additional 5 year terms. Under the terms of the gross leases, the tenant pays its pro-rata share of common area expenses, taxes and insurance and certain other expenses.
 
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 FINANCING ARRANGEMENTS
Immediately prior to the distribution, we intend to pay a cash dividend to Tribune of up to $275 million. We expect to fund such cash dividend with proceeds from debt financing that we anticipate arranging prior to the distribution. In connection with the distribution, we also expect to enter into the Senior ABL Facility to fund working capital and other liquidity needs and to provide a sublimit for the issuance of letters of credit. The Senior Term Loan Facility is expected to provide for aggregate proceeds of approximately $350 million and the Senior ABL Facility is expected to provide (subject to availability under a borrowing base) for aggregate maximum commitments of approximately $140 million. We expect the Senior ABL Facility will be undrawn at the time of the distribution. In addition, we expect to enter into an arrangement to allow cash backed letters of credit, with approximately $25 million issued on our behalf. We also expect to have approximately $25 million of additional letters of credit issued under the Senior ABL Facility as of the distribution date, for a total of approximately $50 million of letters of credit. The Senior ABL Facility is expected to include flexibility for additional letters of credit to be issued thereunder. Subject to certain conditions, subsequent to the closing date of the Senior Term Loan Facility and the Senior ABL Facility, without the consent of the then existing lenders (but subject to the receipt of commitments), we expect that such facilities may be expanded by certain incremental commitments or facilities by up to an amount to be agreed. The anticipated principal terms of the Senior Credit Facilities are summarized below based on our discussions to date with potential lenders thereunder. However, there can be no assurance that the Senior Credit Facilities will be finalized on similar terms, if at all.
Maturity; Amortization and Prepayments
The Senior Term Loan Facility is expected to have a maturity of seven years. In addition, however, we expect the credit agreement governing the Senior Term Loan Facility to provide the right for individual lenders to extend the maturity date of their loans upon our request and without the consent of any other lender. The full amount of the Senior Term Loan Facility is expected to be made in a single drawing immediately prior to the distribution, and amounts borrowed under the Senior Term Loan Facility that are repaid or prepaid may not be reborrowed. The Senior Term Loan Facility is expected to amortize in quarterly installments until the maturity date, with the first such installment due at the end of the first full quarter following the closing date. Certain voluntary prepayments of the Senior Term Loan Facility are expected to be subjected to a “soft call” premium for a period of 6 months following the closing date, after which point the Senior Term Loan Facility may be prepaid without premium or penalty. Subject to certain exceptions, the Senior Term Loan Facility is expected to be subject to mandatory prepayment and reduction from a portion of excess cash flow, the net cash proceeds received from the incurrence of certain indebtedness and the net cash proceeds of certain asset sales.
The Senior ABL Facility is expected to have a maturity of five years. In addition, however, we expect the credit agreement governing the Senior ABL Facility to provide the right for individual lenders to extend the maturity date of their loans upon our request and without the consent of any other lender. We expect that the Senior ABL Facility will permit voluntary reductions of the unutilized portion of the commitments and prepayments of borrowings at our option at any time without premium or penalty and will be subject to mandatory prepayment in amounts equal to the amount by which the outstanding extensions of credit exceed the lesser of the borrowing base and the commitments then in effect. Mandatory prepayments shall not result in a permanent reduction of the lenders’ commitments under the Senior ABL Facility.
Guarantees; Security
We expect to be the borrower under the Senior Term Loan Facility and, together with certain material domestic subsidiaries, under the Senior ABL Facility. The obligations under the Senior Credit Facilities are expected to be guaranteed by us and each of our existing and future direct and indirect wholly-owned domestic subsidiaries (subject to certain exceptions).
All obligations of the borrower and each guarantor under the Senior Term Loan Facility are generally expected to be secured by the following: (a) a perfected security interest in substantially all present and after-acquired property of the type of property constituting the borrowing base (the “ABL Priority Collateral”), which security interest will be junior to the security interest in the foregoing assets securing the Senior ABL Facility;
 
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and (b) a perfected security interest in substantially all other assets of the borrower and the guarantors (other than the ABL Priority Collateral and with certain other exceptions) (the “Term Loan Priority Collateral”), which security interest will be senior to the security interest in the foregoing assets securing the Senior ABL Facility.
All obligations of each borrower and each guarantor under the Senior ABL Facility are generally expected to be secured by the following: (a) a perfected security interest in the ABL Priority Collateral, which security interest will be senior to the security interest in such collateral securing the Senior Term Loan Facility; and (b) a perfected security interest in the Term Loan Priority Collateral, which security interest will be junior to the security interest in such collateral securing the Senior Term Loan Facility.
Interest; Fees
Interest rates per annum applicable to borrowings under the Senior Credit Facilities are expected to be fluctuating rates of interest measured by reference to either (1) adjusted LIBOR plus an applicable margin or (2) an alternate base rate plus an applicable margin. Customary fees are expected to be payable in respect of the Senior ABL Facility, including letter of credit fees and a commitment fee. Letter of credit fees are expected to be payable in connection with the cash backed letter of credit arrangement.
Covenants
The Senior Credit Facilities are expected to contain customary affirmative and negative covenants. The negative covenants are expected to, among other things, restrict the ability of Tribune Publishing and its restricted subsidiaries to incur other indebtedness (including guarantees of other indebtedness); incur liens; make investments; undergo fundamental corporate changes; sell or otherwise dispose of assets; pay dividends or make other restricted payments (other than the initial dividend to Tribune prior to the distribution); enter into sale leaseback transactions; enter into transactions with affiliates; enter into agreements restricting dividends or other distributions by subsidiaries to Tribune Publishing or subsidiary guarantors or agreements limiting the ability to grant liens on the collateral securing the Senior Credit Facilities; and prepay or amend the terms of other indebtedness. The negative covenants will be subject to customary exceptions and, in the case of the Senior ABL Facility, will also permit certain restricted activities upon satisfaction of a “payment condition.” The Senior ABL Facility is also expected to include a springing financial covenant requiring a minimum fixed charge coverage ratio of at least 1.00 to 1.00, which will be tested only when availability falls below a certain threshold.
Events of Default
The Senior Credit Facilities are expected to provide for customary events of default, including non-payment of principal, interest or fees, violation of covenants, inaccuracy of representations or warranties, cross default to certain other material indebtedness, bankruptcy and insolvency events, invalidity or impairment of guarantees or security interests, material judgments and change of control.
 
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 DIVIDEND POLICY
In connection with the distribution, we expect to enter into the Senior Term Loan Facility with aggregate proceeds of approximately $350 million. See “Financing Arrangements.” Immediately prior to the distribution, we expect to use up to $275 million of the proceeds of the Senior Term Loan Facility to pay a one-time cash dividend to Tribune.
Following the distribution, we expect to pay regular quarterly cash dividends on our common stock, which dividend initially is expected to be at an annual rate of approximately $0.70 per share. The declaration and payment of dividends is subject to the sole discretion of our Board of Directors and the considerations discussed below. We expect that the first such quarterly dividend will be declared and paid in the fourth quarter of 2014. We intend to fund our initial dividend, as well as any future dividends, from distributions made to us by our operating subsidiaries from their available cash generated from operations.
Future cash dividends, if any, will be at the discretion of our Board of Directors and the amount of cash dividends per share will depend upon, among other things, our future earnings, financial condition, results of operations, level of indebtedness, capital requirements and surplus, contractual restrictions, number of shares of common stock outstanding, as well as legal requirements, regulatory constraints, industry practice and other factors that our Board of Directors deems relevant. For example, our ability to pay cash dividends on our common stock will be subject to our continued compliance with the terms of our Senior Credit Facilities and may be further restricted in the future by the terms of future indebtedness or preferred securities. The timing and amount of future dividend payments will be at the discretion of our Board of Directors, and we cannot provide any assurance that any dividends will be declared and paid or that we will continue to pay quarterly dividends even if we commence the payment of dividends. Our dividend policy has certain risks and limitations, particularly with respect to liquidity. We may not pay dividends according to our policy, or at all, if, among other things, we do not have the cash necessary to pay our intended dividends or we have alternative uses for such cash. By paying cash dividends rather than saving or investing that cash, we risk, among other things, slowing the pace of our growth and having insufficient cash to fund our operations or unanticipated capital expenditures. See “Risk Factors—Risks Related to Our Common Stock and the Securities Market—Our ability to pay regular dividends to our stockholders is subject to the discretion of our Board of Directors and may be limited by restrictions under our Senior Credit Facilities and applicable provisions of Delaware law.”
 
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 CAPITALIZATION
The following table sets forth Tribune Publishing’s cash and capitalization as of Mar. 30, 2014, on a historical and unaudited pro forma basis to give effect to the separation from Tribune and the transactions related to the separation as if they occurred on Mar. 30, 2014. Explanation of the pro forma adjustments made to our historical combined financial statements can be found under “Unaudited Pro Forma Combined Financial Statements.” The information below is not necessarily indicative of what Tribune Publishing’s capitalization would have been had the separation, distribution and related financing transactions been completed as of Mar. 30, 2014.
The following table should be reviewed in conjunction with “Unaudited Pro Forma Combined Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Tribune Publishing’s historical combined financial statements and accompanying notes included elsewhere in this information statement.

 	  	As of Mar. 30, 2014	 	
 	  	Historical	 	  	Pro forma	 	
 	  	(in thousands, except share data)	 	
Cash(1)	  	$	8,540	  	  	$	58,540	  	

Capitalization:	  				  				
Debt:	  				  				
Senior Term Loan Facility(1)	  	$	—	  	  	$	350,000	  	
Senior ABL Facility(1)	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	
Total debt	  	$	—	  	  	$	350,000	  	
			
Equity:	  				  				
Common stock ($0.01 par value per share), 300,000,000 shares authorized,          shares issued and outstanding	  	$	—	  	  	$	        	  	
Additional paid-in-capital	  	 	—	  	  				
Net parent investment(1)(2)	  	 	180,932	  	  				
	  	 	 	 	  	 	 	 	
Total equity	  	$	180,932	  	  	$	        	  	

Total capitalization	  	$	180,932	  	  	$	        	  	

(1)	Immediately prior to the distribution, Tribune Publishing expects to enter into the Senior Term Loan Facility with aggregate proceeds of approximately $350 million. We intend to use a portion of the proceeds from the Senior Term Loan Facility to fund a cash dividend of up to $275 million to Tribune. In connection with the distribution, Tribune Publishing also expects to enter into the Senior ABL Facility to fund working capital and other liquidity needs and to provide a sublimit for the issuance of letters of credit. In addition, we expect to enter into an arrangement to allow cash backed letters of credit of approximately $25 million to be issued on our behalf, which amount is expected to be classified as restricted cash and cash equivalents on Tribune Publishing’s combined balance sheet and has been excluded from the pro forma cash amount. See “Financing Arrangements” for further information on Tribune Publishing’s anticipated Senior Credit Facilities.	
(2)	Reflects the net parent company investment impact as a result of the anticipated post-distribution capital structure. As of the distribution date, the net parent investment in Tribune Publishing will be exchanged to reflect the distribution of Tribune Publishing’s common stock to Tribune stockholders and to reflect the aggregate par value of our shares of common stock being distributed in the distribution.	
 
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 UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements consist of the unaudited pro forma combined statement of operations for the year ended Dec. 29, 2013 and the three months ended Mar. 30, 2014 and an unaudited pro forma combined balance sheet as of Mar. 30, 2014. These unaudited pro forma combined financial statements were derived from Tribune Publishing’s audited and unaudited combined financial statements included elsewhere in this information statement. The pro forma adjustments give effect to the distribution and the related transactions, as described in the notes to the unaudited pro forma combined financial statements. The unaudited pro forma combined statement of operations for the year ended Dec. 29, 2013 and the three months ended Mar. 30, 2014 give effect to the distribution as if it had occurred on Jan. 1, 2013, the first day of fiscal 2013 following Tribune’s emergence from bankruptcy. The unaudited pro forma combined balance sheet gives effect to the distribution as if it had occurred on Mar. 30, 2014.
The unaudited pro forma combined financial statements include certain adjustments that are necessary to present fairly Tribune Publishing’s unaudited pro forma combined results of operations and unaudited pro forma combined balance sheet as of and for the period indicated. The pro forma adjustments give effect to events that are (i) directly attributable to the distribution and the related transactions, (ii) factually supportable and, (iii) with respect to the unaudited pro forma combined statement of operations, expected to have a continuing impact on Tribune Publishing and are based on assumptions that management believes are reasonable given the information currently available.
The unaudited pro forma combined financial statements give effect to the following:
 
 	—  	 	the removal of depreciation expense related to the properties transferred to Tribune’s real estate holding companies and the recognition of lease expense for the related party lease agreements during the year ended Dec. 29, 2013;	
 
 	—  	 	the impact of the transition services agreement with Tribune and its non-Tribune Publishing subsidiaries (“Tribune Affiliates”);	
 
 	—  	 	the impact of non-recurring separation costs; and	
 
 	—  	 	the anticipated post-distribution capital structure, including the incurrence of new indebtedness and the payment of a cash dividend to Tribune.	
The unaudited pro forma combined financial statements are subject to the assumptions and adjustments described in the accompanying notes. These unaudited pro forma combined financial statements are subject to change as Tribune and Tribune Publishing finalize the terms of the separation and distribution agreement and other agreements and transactions related to the distribution.
The unaudited pro forma combined financial statements have been presented for informational purposes only. The pro forma information is not necessarily indicative of Tribune Publishing’s results of operations or financial condition had the distribution and the related transactions been completed on the dates assumed and should not be relied upon as a representation of our future performance.
Tribune Publishing’s management expects its ongoing cost structure to change when it becomes an independent, publicly-traded company, as Tribune currently provides many corporate functions on Tribune Publishing’s behalf, including finance, legal, insurance, information technology and human resources services. The historical combined financial statements include allocations to Tribune Publishing from Tribune for these corporate functions. Tribune Publishing’s management believes that the bases used for the allocations are
 
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reasonable and reflect the portion of the costs attributed to Tribune Publishing’s operations while operating as a business of Tribune; however, these costs may not be representative of the future costs that Tribune Publishing will incur as an independent, publicly-traded company.
The following unaudited pro forma combined financial statements should be read in conjunction with the historical combined financial statements for Tribune Publishing and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this information statement.
 
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TRIBUNE PUBLISHING
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
For the Year Ended Dec. 29, 2013

(In thousands, except share and
per share amounts)	  	Historical	 	 	Pro Forma
Adjustments	 	 	 	 	    	Pro Forma	 	
					
Operating Revenues	  				 				 				    				
Advertising	  	$	            1,052,877	  	 	$	                                	  	 				    	$	                            	  	
Circulation	  	 	428,615	  	 				 				    				
Other	  	 	313,615	  	 				 				    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Total operating revenues	  	 	1,795,107	  	 				 				    				
					
Operating Expenses	  				 				 				    				
Cost of sales (exclusive of items shown below)	  	 	1,010,078	  	 	 	                    29,229	  	 	 	(a	)(b) 	    				
Selling, general and administrative	  	 	590,069	  	 	 	4,049	  	 	 	(a	)(b) 	    				
	  				 				 	 	(c	)(d) 	    				
	  				 				 	 	(g	) 	    				
Depreciation	  	 	21,851	  	 	 	(4,653	) 	 	 	(a	)(g) 	    				
Amortization	  	 	6,580	  	 				 				    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Total operating expenses	  	 	1,628,578	  	 				 				    				
					
Operating Profit	  	 	166,529	  	 				 				    				
Loss on equity investments, net	  	 	(1,187	) 	 				 				    				
Interest income (expense), net	  	 	14	  	 	 	(14,000	) 	 	 	(e	) 	    				
Reorganization items, net	  	 	(270	) 	 				 				    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Income Before Income Taxes	  	 	165,086	  	 				 				    				
Income tax expense	  	 	70,992	  	 				 	 	(f	) 	    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Net Income	  	$	94,094	  	 	$	 	  	 				    	$	 	  	
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Earnings per share:	  				 				 				    				
Basic	  	 	N/A	  	 				 	 	(j	) 	    	$	 	  	
Diluted	  	 	N/A	  	 				 	 	(j	) 	    	$	 	  	
					
Weighted-Average Shares Outstanding:	  				 				 				    				
Basic	  	 	N/A	  	 				 	 	(j	) 	    				
Diluted	  	 	N/A	  	 				 	 	(j	) 	    				
See notes to unaudited pro forma combined financial statements.
 
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TRIBUNE PUBLISHING
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
For the Three Months Ended Mar. 30, 2014

(In thousands, except share and
per share amounts)	  	Historical	 	 	Pro Forma
Adjustments	 	 	 	 	    	Pro Forma	 	
					
Operating Revenues	  				 				 				    				
Advertising	  	$	233,035	  	 	$	                                	  	 				    	$	                            	  	
Circulation	  	 	107,307	  	 				 				    				
Other	  	 	76,180	  	 				 				    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Total operating revenues	  	 	416,522	  	 				 				    				
					
Operating Expenses	  				 				 				    				
Cost of sales (exclusive of items shown below)	  	 	247,523	  	 	 	3,055	  	 	 	(b	) 	    				
Selling, general and administrative	  	 	143,882	  	 	 	(3,746	) 	 	 	(b	)(c) 	    				
	  				 				 	 	(d	)(g) 	    				
Depreciation	  	 	2,740	  	 				 	 	(g	) 	    				
Amortization	  	 	1,606	  	 				 				    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Total operating expenses	  	 	395,751	  	 				 				    				
					
Operating Profit	  	 	20,771	  	 				 				    				
Loss on equity investments, net	  	 	(335	) 	 				 				    				
Interest expense, net	  	 	(2	) 	 	 	(3,490	) 	 	 	(e	) 	    				
Reorganization items, net	  	 	(9	) 	 				 				    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Income Before Income Taxes	  	 	20,425	  	 				 				    				
Income tax expense	  	 	8,653	  	 				 	 	(f	) 	    				
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Net Income	  	$	11,772	  	 	$	 	  	 				    	$	 	  	
	  	 	 	 	 	 	 	 	 				    	 	 	 	
Earnings per share:	  				 				 				    				
Basic	  				 				 	 	(j	) 	    	$	 	  	
Diluted	  				 				 	 	(j	) 	    	$	 	  	
					
Weighted-Average Shares Outstanding:	  				 				 				    				
Basic	  				 				 	 	(j	) 	    				
Diluted	  				 				 	 	(j	) 	    				
See notes to unaudited pro forma combined financial statements.
 
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TRIBUNE PUBLISHING
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
As of Mar. 30, 2014

(In thousands)	  	Historical	 	 	Pro Forma
Adjustments	 	 	 	 	  	Pro Forma	 	
Assets	  				 				 				  				
Current Assets	  				 				 				  				
Cash	  	$	8,540	  	 	$	50,000	  	 	 	(h	) 	  	$	                            	  	
Restricted cash and cash equivalents	  	 	—	  	 	 	25,000	  	 	 	(i)	  	  				
Accounts receivable	  	 	207,748	  	 				 				  				
Inventories	  	 	14,630	  	 				 				  				
Deferred income taxes	  	 	34,402	  	 				 				  				
Prepaid expenses and other	  	 	14,758	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total current assets	  	 	280,078	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Properties	  				 				 				  				
Machinery, equipment and furniture	  	 	67,692	  	 				 	 	(g	) 	  				
Buildings and leasehold improvements	  	 	4,256	  	 				 	 	(g	) 	  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
	  	 	71,948	  	 				 				  				
Accumulated depreciation	  	 	(18,732	) 	 				 	 	(g	) 	  				

Land	  	 	53,216	  	 				 				  				
Construction in progress	  	 	13,236	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Net properties	  	 	66,452	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Other Assets	  				 				 				  				
Goodwill	  	 	16,064	  	 				 				  				
Intangible assets, net	  	 	59,210	  	 				 				  				
Investments	  	 	3,465	  	 				 				  				
Deferred income taxes	  	 	37,216	  	 				 				  				
Other	  	 	1,660	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total other assets	  	 	117,615	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total assets	  	$	464,145	  	 	$	 	  	 				  	$	 	  	
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Liabilities and Equity	  				 				 				  				
Current Liabilities	  				 				 				  				
Accounts payable	  	$	37,287	  	 	$	 	  	 				  	$	 	  	
Debt due within one year	  	 	—	  	 				 	 	(h	) 	  				
Employee compensation and benefits	  	 	91,062	  	 				 				  				
Deferred revenue	  	 	73,436	  	 				 				  				
Other	  	 	21,661	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total current liabilities	  	 	223,446	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Non-Current Liabilities	  				 				 				  				
Deferred revenue	  	 	9,337	  	 				 				  				
Postretirement medical, life and other benefits	  	 	44,479	  	 				 				  				
Long-term debt	  	 	—	  	 	 	350,000	  	 	 	(h	) 	  				
Other obligations	  	 	5,591	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total non-current liabilities	  	 	59,767	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Equity	  				 				 				  				
Common stock	  	 	—	  	 				 	 	(j	) 	  				
Additional paid-in-capital	  	 	—	  	 				 	 	(j	) 	  				
Net parent investment	  	 	180,932	  	 	 	(275,000	) 	 	 	(h	)(j) 	  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total Equity	  	 	180,932	  	 				 				  				
	  	 	 	 	 	 	 	 	 				  	 	 	 	
Total liabilities and equity	  	$	464,145	  	 	$	 	  	 				  	$	 	  	
	  	 	 	 	 	 	 	 	 				  	 	 	 	
See notes to unaudited pro forma combined financial statements.
 
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TRIBUNE PUBLISHING
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
For further information regarding the historical combined financial statements of Tribune Publishing, refer to the audited and unaudited combined financial statements and the notes thereto included in this information statement. The unaudited pro forma combined statement of operations for the year ended Dec. 29, 2013 and the three months ended Mar. 30, 2014 and the unaudited pro forma combined balance sheet as of Mar. 30, 2014 include adjustments related to the following:
 
 	(a)	On Dec. 21, 2012, the majority of the land and buildings owned by Tribune Publishing were transferred to Tribune’s newly established real estate holding companies. In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back certain land and buildings that were transferred on Dec. 21, 2012. Although the properties subject to related party leases were legally transferred to the holding companies, Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing involvement with the properties, which, pursuant to ASC Topic 840, “Leases,” precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result, Tribune Publishing continued to account for and depreciate the carrying values of the transferred properties subject to related party leases.	
On Nov. 15, 2013, Tribune Publishing transferred two additional properties to the real estate holding companies and subsequently leased the properties back from Tribune.
Effective Dec. 1, 2013, Tribune Publishing modified certain provisions of the related party leases with the Tribune real estate holding companies. As a result of these modifications, Tribune Publishing determined that it no longer maintained forms of continuing involvement; thus, Tribune Publishing derecognized the transferred properties from its financial statements and began accounting for these related party operating leases on this date.
The unaudited pro forma combined statement of operations for the year ended Dec. 29, 2013 reflects an increase to rent expense and a decrease to depreciation expense as if the derecognition of the transferred land and buildings occurred on Jan. 1, 2013. The increase to rent expense reflects rent amounts pursuant to the related party lease agreements with the real estate holding companies. The decrease to depreciation expense reflects the reversal of depreciation expense recognized by Tribune Publishing in its audited combined financial statements related to the transferred properties. The impacts to the unaudited pro forma combined statement of operations for the year ended Dec. 29, 2013 are as follows:
Year Ended Dec. 29, 2013
 
 	  i.	$15.5 million increase to cost of sales for rent expense	
 
 	 ii.	$8.8 million increase to selling, general and administrative for rent expense	
 
 	iii.	$4.7 million decrease to depreciation	
 
 	(b)	Retirement benefits have been historically provided to eligible Tribune Publishing employees through a combination of defined benefit pension plans sponsored by Tribune, defined contribution plans and participation in several multiemployer pension plans on behalf of certain employees represented by unions. The retirement benefit obligations pursuant to the Tribune-sponsored defined benefit pension plans have historically been an obligation of Tribune. Accordingly, no assets or liabilities related to the obligations under the Tribune defined benefit pension plans have been included in the Tribune Publishing combined balance sheets, as further described in Note 4 of the audited combined financial statements. This adjustment reflects the removal of the actuarially determined net periodic pension	
 
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 	credit of $23.8 million for the year ended Dec. 29, 2013 and $5.4 million for the three months ended Mar. 30, 2014 as Tribune Publishing will not have continuing obligations under the Tribune-sponsored single-employer qualified defined benefit pension plans.	
 
 	(c)	In connection with the distribution, Tribune Publishing expects to enter into a transition services agreement with Tribune, pursuant to which Tribune and Tribune Publishing will provide to each other certain specified services on a transitional basis, including various information technology, financial and administrative services. The charges for the transition services generally are expected to allow the providing company to fully recover all out-of-pocket costs and expenses it actually incurs in connection with providing the service, plus, in some cases, the allocated direct costs of providing the services, generally without profit. This adjustment reflects the net impact of $         million for the year ended Dec. 29, 2013 and $         million for the three months ended Mar. 30, 2014 for the transition services agreement.	
 
 	(d)	Reflects the removal of $14.7 million and $6.0 million of costs that were incurred for the year ended Dec. 29, 2013 and the three months ended Mar. 30, 2014, respectively, associated with the expected separation and distribution of Tribune Publishing from Tribune. These separation costs primarily related to tax, accounting, legal and other professional fees.	
 
 	(e)	Reflects interest expense of $14.0 million and $3.5 million for the year ended Dec. 29, 2013 and for the three months ended Mar. 30, 2014, respectively, related to the incurrence of $350 million of debt described in Note (h). The assumed weighted-average interest rate on debt of 4.0% is based on the interest rate of Tribune’s Term Loan Facility entered into on Dec. 27, 2013. Interest expense was calculated assuming constant debt levels throughout the period. Interest expense may be higher or lower if Tribune Publishing’s actual interest rate differs from the assumed interest rate due to its credit rating or other factors. A 1/8% change to the annual interest rate would change interest expense by approximately $0.4 million on an annual basis. A 1% change to the annual interest rate would change interest expense by approximately $3.5 million on an annual basis.	
 
 	(f)	Reflects the income tax effect of the pro forma adjustments impacting earnings before income taxes calculated using the applicable U.S. federal and state statutory tax rates. The assumed effective income tax rate of         % is determined based on the relative effect of the pro forma adjustments to the applicable jurisdictions of the U.S.	
 
 	(g)	Reflects adjustments for other assets and liabilities in the combined financial statements that will not be retained by Tribune Publishing after the separation and have not already been transferred as described in Note (a), as well as assets and liabilities that are to be contributed to Tribune Publishing from Tribune and Tribune Affiliates in connection with the separation. These will include a portion of shared information technology assets.	
 
 	    	The contributed assets and liabilities were not included in the historical combined financial statements as a final decision had not been made to contribute the assets and liabilities by management at the time of preparation of the combined financial statements and these assets and liabilities were not discretely identifiable to Tribune Publishing. Depreciation on the assets to be transferred to Tribune Publishing was previously charged to Tribune Publishing through allocations from Tribune’s corporate functions. The allocated depreciation expense associated with these assets totaled $         million and is reclassified from selling, general and administrative expenses to depreciation expense.	
 
 	(h)	Reflects the expected entry into a new debt facility of $350 million, less the distribution of a $275 million cash dividend Tribune Publishing intends to pay to Tribune in connection with the planned separation and distribution. Tribune Publishing expects to incur debt through a combination of the following: long-term and short-term debt issuances and borrowings under bank credit facilities. In these unaudited pro forma combined financial statements, Tribune Publishing has assumed all debt is long-term. The actual terms and maturity of the new debt will depend on a number of factors, including	
 
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 	market conditions at the time the debt is incurred. We expect to incur customary fees in connection with entering into the new debt facilities. Costs and expenses related to entering into the debt facility will be capitalized and amortized over the term of the debt facility. These fees, costs and other expenses have not been reflected in the unaudited pro forma combined financial statements.	
 
 	(i)	Reflects segregated amounts pursuant to an arrangement we expect to enter into to provide a cash backed letter of credit to be issued on our behalf.	
 
 	(j)	Reflects the net parent company investment impact as a result of the anticipated post-distribution capital structure. As of the distribution date, the net parent investment in Tribune Publishing will be exchanged to reflect the distribution of Tribune Publishing’s common stock to Tribune stockholders and to reflect the par value of          million outstanding shares of common stock having a par value of $0.01 per share.	
 
 	(k)	The weighted average number of shares used to compute pro forma basic and diluted earnings per share is          million, as adjusted for an assumed distribution ratio of          and up to          potential shares of common stock anticipated to be issued to Tribune Publishing employees in connection with a new equity incentive plan.	
 
 	(l)	An affiliate of Tribune is currently party to an affiliation agreement with CareerBuilder whereby Tribune Publishing’s newspapers earn advertising revenues and pay affiliate fees. Pursuant to the terms of the limited liability company agreement with CareerBuilder, if Tribune (together with its affiliates) were to cease to own at least a 30% voting and economic interest in Tribune Publishing’s newspapers, CareerBuilder could terminate the existing affiliation agreement. However, if Tribune (together with its affiliates) directly or indirectly retains at least a 1% voting and economic interest in Tribune Publishing’s newspapers, Tribune could elect to enter into a modified affiliation agreement that would apply to Tribune Publishing’s newspapers for up to five years. While such a modified affiliation agreement would be on less favorable terms compared to the existing affiliation agreement, we have no history operating under such a modified affiliation agreement and, thus, are not able to predict how such agreement will impact our future revenues and affiliate fees. The unaudited pro forma combined financial statements do not reflect any estimates of the impact on revenues or affiliate fees of a modified affiliation agreement because projected amounts would be based on estimates and not factually supportable. Tribune expects to retain a 1.5% interest in Tribune Publishing for up to five years for the purpose of enabling us to retain the benefits of the modified affiliation agreement. However, Tribune may cease to retain at least a 1% interest in Tribune Publishing prior to the end of such five year period, or other circumstances may occur that could cause our newspapers to cease to earn advertising revenue and pay affiliate fees under an affiliation agreement with CareerBuilder.	
Each of our newspapers is currently party to an affiliation agreement with Classified Ventures pursuant to which our newspapers earn advertising revenues and pay affiliate fees. The affiliation agreements are subject to annual renewal. There can be no assurance that, subsequent to the distribution, our newspapers will be able to enter into annual renewals of these affiliation agreements on similar terms, or at all, or continue to earn the same level of advertising revenues or pay the same level of affiliate fees under the affiliation agreements following the distribution.
Tribune Publishing records revenue related to the CareerBuilder and Classified Ventures affiliation agreements for classified advertising products placed on affiliated digital platforms. Such amounts totaled $44 million and $71 million for the year ended Dec. 29, 2013 and $10 million and $19 million for the three months ended Mar. 30, 2014 related to CareerBuilder and Classified Ventures, respectively. These revenues are recorded within advertising revenues in Tribune Publishing’s historical combined statements of operations.
 
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Tribune Publishing also pays fees to CareerBuilder and Classified Ventures under the affiliation agreements related to selling the classified advertising products. Such amounts totaled $5 million and $24 million for the year ended Dec. 29, 2013 and $2 million and $7 million for the three months ended Mar. 30, 2014 for CareerBuilder and Classified Ventures, respectively. These affiliate fees are recorded as cost of sales in Tribune Publishing’s historical combined statements of operations. In addition, Tribune Publishing incurred additional selling costs related to sales of CareerBuilder and Classified Ventures advertising products. Such additional costs are estimated to have totaled $4 million and $13 million for the year ended Dec. 29, 2013 and $1 million and $4 million for the three months ended Mar. 30, 2014 for CareerBuilder and Classified Ventures, respectively.
On April 1, 2014, Classified Ventures completed a transaction to sell its Apartments.com business. The sale of Apartments.com will impact Tribune Publishing’s future revenue and affiliate fees related to Classified Ventures. Tribune Publishing recorded revenue and affiliate fees associated with Apartments.com of approximately $7 million and $1 million for the year ended Dec. 29, 2013 and $2 million and $0.2 million for the three months ended Mar. 30, 2014, respectively.
 
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 SELECTED HISTORICAL COMBINED FINANCIAL DATA
Set forth below are selected historical combined financial data for Tribune Publishing for the three months ended Mar. 30, 2014 and Mar. 31, 2013 and for each of the five years ended Dec. 29, 2013, Dec. 30, 2012, Dec. 25, 2011, Dec. 26, 2010 and Dec. 27, 2009, and for Dec. 31, 2012. Operating results for any prior period are not necessarily indicative of results to be expected in any future period, and operating results for the 2014 interim period are not necessarily indicative of the operating results that Tribune Publishing will experience for the entire year. We derived the combined statement of operations data for the years ended Dec. 29, 2013, Dec. 30, 2012 and Dec. 25, 2011 and for Dec. 31, 2012, and the combined balance sheet data as of Dec. 29, 2013, Dec. 30, 2012 and Dec. 31, 2012, from the Tribune Publishing historical combined financial statements, which are included elsewhere in this information statement. We derived the combined statement of operations data for the three months ended Mar. 30, 2014 and Mar. 31, 2013 from the Tribune Publishing unaudited interim combined financial statements, which are included elsewhere in this information statement. We derived the combined statement of operations data for the fiscal years ended Dec. 26, 2010 and Dec. 27, 2009, and the combined balance sheet data as of Mar. 31, 2013, Dec. 25, 2011, Dec. 26, 2010 and Dec. 27, 2009 from the financial records of Tribune, which are not included in this information statement.
The selected historical combined financial data set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the historical combined financial statements and the notes thereto included in this information statement. The selected historical combined financial data reflects Tribune Publishing’s results as historically operated as a part of Tribune, and these results may not be indicative of our future performance as a stand-alone company following the distribution. Operating expenses reflect direct expenses and allocations of certain Tribune corporate expenses that have been charged to Tribune Publishing based on specific identification or allocated based on use or other methodologies we believe appropriate. Management believes these allocations have been made on a reasonable and appropriate basis under the circumstances. Per share data has not been presented since Tribune Publishing’s business was wholly-owned by Tribune during the periods presented.

 	 	Successor	 	 	  	 	Predecessor	 	
 	 	As of and
for the three
months ended	 	 	As of and
for the year
ended	 	 	  	 	As of and
for	 	  	As of and for the years ended	 	
 	 	Mar. 30,
2014	 	 	Mar. 31,
2013	 	 	Dec. 29,
2013	 	 	  	 	Dec. 31,
2012 1	 	  	Dec. 30,
2012	 	  	Dec. 25,
2011	 	  	Dec. 26,
2010	 	  	Dec. 27,
2009	 	
(in thousands)	 				 				 				 	 	 				  				  				  				  				
				 						
STATEMENT OF OPERATIONS DATA:	 				 				 				 	 	 				  				  				  				  				
Operating Revenues	 	$	416,522	  	 	$	440,513	  	 	$	1,795,107	  	 	 	 	$	—	  	  	$	1,913,814	  	  	$	1,915,932	  	  	$	2,021,912	  	  	$	2,182,076	  	
Operating Profit	 	$	20,771	  	 	$	37,653	  	 	$	166,529	  	 	 	 	$	—	  	  	$	41,656	  	  	$	44,569	  	  	$	101,119	  	  	$	84,778	  	
Net Income	 	$	11,772	  	 	$	21,193	  	 	$	94,094	  	 	 	 	$	2,842,326	  	  	$	28,395	  	  	$	41,614	  	  	$	101,287	  	  	$	73,660	  	
				 						
BALANCE SHEET DATA:	 				 				 				 	 	 				  				  				  				  				
Total Assets	 	$	464,145	  	 	$	843,317	  	 	$	514,366	  	 	 	 	$	897,797	  	  	$	951,232	  	  	$	1,043,785	  	  	$	1,063,826	  	  	$	1,166,310	  	
Total Non-Current Liabilities	 	$	59,767	  	 	$	59,660	  	 	$	61,061	  	 	 	 	$	61,787	  	  	$	66,300	  	  	$	79,728	  	  	$	79,270	  	  	$	87,904	  	

1  	Operating results for Dec. 31, 2012 include only (i) reorganization adjustments which resulted in a net gain of $2.862 billion before taxes ($2.894 billion after taxes) and (ii) fresh-start reporting adjustments which resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). See Note 3 to the audited combined financial statements for further information.	
 
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 MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the other sections of this information statement, including “Risk Factors,” “Cautionary Statement Concerning Forward-Looking Statements,” “Unaudited Pro Forma Combined Financial Statements,” “Financing Arrangements,” “Business,” “Selected Historical Combined Financial Data,” and the combined financial statements and the notes thereto included in this information statement. Management’s Discussion and Analysis of Financial Condition and Results of Operations contains a number of forward-looking statements, all of which are based on our current expectations and could be affected by the uncertainties and other factors described throughout this information statement and particularly in “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements.”
We believe that the assumptions underlying the combined financial statements included in the information statement are reasonable. However, the combined financial statements may not necessarily reflect our results of operations, financial position and cash flows for future periods or what they would have been had Tribune Publishing been a separate, stand-alone company during the periods presented.
Overview
On July 10, 2013, Tribune announced its plan to spin-off essentially all of its publishing business into an independent company. The new business representing the principal publishing operations of Tribune and certain other entities wholly-owned by Tribune, as described below, will be organized as a new company, Tribune Publishing. Tribune Publishing’s operations consist of eight principal major-market daily newspapers and related businesses, distribution of preprinted insert advertisements, commercial printing and delivery services to other newspapers, distribution of syndicated content and management of the websites of Tribune Publishing’s daily newspapers, along with other branded products that target specific areas of interest. The principal daily newspapers are the Los Angeles Times ; the Chicago Tribune ; the Sun Sentinel ; the Orlando Sentinel ; The Baltimore Sun ; the Hartford Courant ; The Morning Call , serving Pennsylvania’s Lehigh Valley; and the Daily Press , serving the Virginia Peninsula. Tribune Publishing’s operations also include Blue Lynx Media, LLC (“BLM”), which operates a shared service center for the benefit of Tribune and its subsidiaries, including the subsidiaries of Tribune Publishing; a 50% equity interest in CIPS Marketing Group, Inc. (“CIPS”); a 33% equity interest in Homefinder.com, LLC (“Homefinder”); and a 35% equity interest in Locality Labs, LLC (“Locality Labs”), which Tribune will retain following the distribution. Prior to May 7, 2014, Tribune Publishing’s operations also included a 50% equity interest in McClatchy/Tribune Information Services (“MCT”). On May 7, 2014, Tribune Publishing’s subsidiary, TCA News Service, LLC, acquired the remaining 50% interest in MCT.
On March 5, 2014, Tribune Publishing’s subsidiary, The Baltimore Sun Company, LLC, acquired the Baltimore City Paper and its related publications. On April 4, 2014 Tribune Publishing’s subsidiary, the Hartford Courant Company, LLC, acquired Reminder Media and its related publications in eastern and northern Connecticut. On May 1, 2014, The Baltimore Sun Company, LLC acquired The Capital and the Carroll County Times and their related publications.
In 2013, 59% of Tribune Publishing operating revenues were derived from advertising. These revenues were generated from the sale of advertising space in published issues of the newspapers and on interactive websites and from the sale of advertising supplements inserted into the newspapers. Approximately 24% of 2013 operating revenues were generated from the sale of newspapers to individual subscribers or to sales outlets, which re-sell the newspapers. The remaining 17% of 2013 operating revenues were generated from direct mail services, the provision of commercial printing and delivery services to other newspapers, the distribution of syndicated content, direct mail advertising and other related activities.
Advertising revenue includes newspaper print advertising and digital advertising. Newspaper print advertising is typically in the form of display or preprint advertising whereas digital advertising can be in the form of display, banner ads, coupon ads, video, search advertising and linear ads placed on Tribune Publishing
 
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and affiliated websites. Advertising revenues are comprised of three basic categories: retail, national and classified. Changes in advertising revenues are heavily correlated with changes in the level of economic activity in the United States. Changes in gross domestic product, consumer spending levels, auto sales, housing sales, unemployment rates, job creation, circulation levels and rates all impact demand for advertising in Tribune Publishing’s newspapers and websites. Tribune Publishing’s advertising revenues are subject to changes in these factors both on a national level and on a local level in its markets. Circulation revenue results from the sale of print and digital editions of newspapers to individual subscribers and the sale of print editions of newspapers to sales outlets, which re-sell the newspapers. Other revenues are derived from direct mail services, commercial printing and delivery services provided to other newspapers, direct mail advertising and other related activities. Significant operating expense categories include compensation, newsprint and ink, circulation distribution, depreciation and amortization, allocations of corporate costs and other operating expenses. Compensation expense is affected by many factors, including the number of full-time equivalent employees, changes in the design and costs of various employee benefit plans, the level of pay increases and actions to reduce staffing levels. Circulation distribution expenses primarily included delivery and inserting fees paid to third party contractors and postage costs for Tribune Publishing’s total market coverage products. Circulation distribution expenses can vary from year to year due to changes in volume levels, the fees negotiated with third party contractors and postage rates. Newsprint and ink are commodities and pricing can vary significantly from year to year. Allocated corporate costs include charges from Tribune and Tribune Affiliates for certain corporate, service center and technology support services, as well as insurance, occupancy and other costs. Other expenses are principally for sales and marketing activities, occupancy costs, amounts paid to third parties for temporary labor, outside printing and production costs and other general and administrative expenses.
Tribune Publishing uses operating revenues and operating profit as ways to measure financial performance. In addition, Tribune Publishing uses average net paid circulation for its newspapers, together with other factors, to measure its market share and performance. Net paid circulation includes both individually paid copy sales (home delivery, single copy and digital copy sales) and other paid copy sales (education, sponsored and hotel copy sales).
Tribune Publishing’s results of operations, when examined on a quarterly basis, reflect the seasonality of Tribune Publishing’s revenues. Second and fourth quarter advertising revenues are typically higher than first and third quarter revenues. Results for the second quarter reflect spring advertising revenues, while the fourth quarter includes advertising revenues related to the holiday season.
Separation from Tribune Company and Basis of Presentation
Tribune Publishing’s operations are conducted through the following wholly-owned subsidiaries (including each subsidiary’s respective direct wholly-owned subsidiaries) of Tribune Publishing Company, LLC, currently a wholly-owned subsidiary of Tribune: The Morning Call, LLC; Chicago Tribune Company, LLC; The Baltimore Sun Company, LLC; Orlando Sentinel Communications Company, LLC; Los Angeles Times Communications LLC; The Daily Press, LLC; The Hartford Courant Company, LLC; Sun-Sentinel Company, LLC; Tribune Washington Bureau, LLC; Hoy Publications, LLC; Tribune Interactive, LLC; Tribune 365, LLC; Tribune Content Agency, LLC; forsalebyowner.com, LLC; Builder Media Solutions, LLC; and BLM.
Historically, separate financial statements have not been prepared for Tribune Publishing. The Tribune Publishing combined financial statements are derived from the historical accounting records of Tribune and present Tribune Publishing’s combined financial position, results of operations and cash flows as of and for the periods presented as if Tribune Publishing was a separate entity for such periods and as it was historically managed. Management believes that the assumptions and methodologies underlying the allocation of general corporate expenses are reasonable. However, such expenses may not be indicative of the actual level of expense that would have been incurred had Tribune Publishing operated as a separate stand-alone entity, and, accordingly, may not necessarily reflect Tribune Publishing’s combined financial position, results of operations and cash flows had Tribune Publishing operated as a separate stand-alone entity during the periods presented.
 
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Tribune Publishing’s combined financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain assets of Tribune and Tribune Affiliates that are not owned by Tribune Publishing and are otherwise specifically identifiable or attributable to Tribune Publishing and are necessary to present these combined financial results on a stand-alone basis have also been included in the combined financial statements.
In connection with the spin-off, Tribune Publishing expects to enter into various agreements with Tribune and other third parties that may be on different terms than the terms of the arrangements or agreements that existed prior to the spin-off. For instance, Tribune Publishing utilizes the services of Tribune and Tribune Affiliates for certain functions such as legal, finance, human resource and information technology services, as well as various corporate-wide employee benefit programs. The costs of Tribune services that are specifically identifiable to Tribune Publishing are included in the combined financial statements. The costs of Tribune services that are incurred by Tribune but are not specifically identifiable to Tribune Publishing have been allocated to Tribune Publishing and included in the combined financial statements on bases that management considered to be a reasonable reflection of the utilization of services provided or the benefit received by Tribune Publishing during the periods presented. While management considers these allocations to have been made on a reasonable basis, the allocations do not necessarily reflect the expenses that would have been incurred had Tribune Publishing operated as a separate stand-alone entity. All such costs and expenses are assumed to be settled with Tribune through the parent company investment component of equity (deficit) in the period in which the costs were incurred. Current income taxes are also assumed to be settled with Tribune through the parent company investment in the period the related income taxes were recorded.
All intercompany accounts within Tribune Publishing have been eliminated in consolidation. All significant intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates have been included within the combined financial statements and are considered to be effectively settled through equity contributions or distributions or through cash payments at the time the transactions were recorded. The accumulated net effect of intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates are included in the parent company investment component of equity (deficit). These intercompany transactions are further described in Note 6 to Tribune Publishing’s audited combined financial statements. The total net effect of these intercompany transactions is reflected in the combined statements of cash flows as financing activities.
Tribune Publishing assesses its operating segments in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification ™ (“ASC”) Topic 280, “Segment Reporting.” Tribune Publishing is managed by its chief operating decision maker, as defined by ASC Topic 280, as one business. Accordingly, the combined financial statements of Tribune Publishing are presented to reflect one reporting segment.
Significant Events
Chapter 11 Reorganization
On Dec. 8, 2008 (the “Petition Date”), Tribune and 110 of its direct and indirect wholly-owned subsidiaries (each a “Debtor” and, collectively, the “Debtors”), filed voluntary petitions for relief (collectively, the “Chapter 11 Petitions”) under Chapter 11 (“Chapter 11”) of title 11 of the United States Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Debtors’ Chapter 11 proceedings continue to be jointly administered under the caption “ In re: Tribune Company, et al., ” Case No. 08-13141. Certain of the legal entities included in the combined financial statements of Tribune Publishing (see “—Separation from Tribune Company and Basis of Presentation”) were Debtors or, as a result of the restructuring transactions described below, are successor legal entities to legal entities that were Debtors (collectively, the “Tribune Publishing Debtors”). References to the Debtors herein include the Tribune Publishing Debtors unless otherwise indicated. Other legal entities included in the combined financial statements of Tribune Publishing did not file petitions for relief under Chapter 11 as of or subsequent to the Petition Date, and were,
 
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therefore, not Debtors, and are not successors to legal entities that were Debtors (each a “Non-Debtor Subsidiary” and, collectively, the “Non-Debtor Subsidiaries”) as of Dec. 31, 2012. For all periods presented herein, the Non-Debtor Subsidiaries included in the combined financial statements of Tribune Publishing are Tribune Interactive, LLC (as the successor legal entity to Tribune Interactive, Inc.); Riverwalk Center I Joint Venture; Tribune Hong Kong Limited, a foreign subsidiary; BLM; and Local Pro Plus Realty, LLC, a legal entity established subsequent to the Petition Date.
A joint plan of reorganization for the Debtors (the “Plan”), including the Tribune Publishing Debtors, became effective and the Debtors emerged from Chapter 11 on Dec. 31, 2012 (the “Effective Date”). Where appropriate, Tribune Publishing and its business operations as conducted on or after Dec. 31, 2012 are herein referred to as “Reorganized Tribune Publishing,” “Reorganized Tribune Publishing Debtors”, “Successor Tribune Publishing” or “Successor”. Tribune and its business operations conducted on or after Dec. 31, 2012 are herein referred to as “Reorganized Tribune Company” and such references include Reorganized Tribune Publishing and Reorganized Tribune Publishing Debtors unless otherwise indicated. Where appropriate, Tribune Publishing and its business operations as conducted on or prior to Dec. 30, 2012 are herein referred to as “Predecessor Tribune Publishing” or “Predecessor”.
From the Petition Date and until the Effective Date, the Debtors operated their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and applicable orders of the Bankruptcy Court. In general, as debtors-in-possession, the Debtors were authorized under Chapter 11 of the Bankruptcy Code to continue to operate as ongoing businesses, but could not engage in transactions outside the ordinary course of business without the prior approval of the Bankruptcy Court.
For details of the proceedings under Chapter 11 and the terms of the Plan, see Notes 2 and 3 of the audited combined financial statements.
Fresh-Start Reporting
Reorganized Tribune Company adopted fresh-start reporting on the Effective Date in accordance with ASC Topic 852, “Reorganizations.” Reorganized Tribune Publishing also adopted fresh-start reporting on the Effective Date. The combined financial statements of Tribune Publishing as of and for all periods presented prior to the Effective Date have not been adjusted to reflect any changes in Tribune’s capital structure as a result of the Plan nor have they been adjusted to reflect any changes in the fair value of assets and liabilities as a result of the adoption of fresh-start reporting. Such adjustments were applied to Tribune Publishing’s combined financial statements as of the Effective Date and were reflected in Tribune Publishing’s combined financial statements during the first quarter of 2013. Accordingly, Tribune Publishing’s financial statements for periods subsequent to the Effective Date will not be comparable to prior periods as such prior periods do not give effect to the Plan or the related application of fresh-start reporting.
ASC Topic 852 requires, among other things, a determination of the reorganization value for Reorganized Tribune Company and allocation of such reorganization value to the fair value of Reorganized Tribune Company’s tangible assets, finite-lived intangible assets and indefinite-lived intangible assets in accordance with the provisions of ASC Topic 805, “Business Combinations,” as of the Effective Date. In accordance with the provisions of ASC Topic 805, the reorganization value of Reorganized Tribune Company was allocated, in part, to the fair value of Reorganized Tribune Publishing’s tangible assets, finite-lived intangible assets, and indefinite-lived intangible assets as of the Effective Date. The reorganization value for Reorganized Tribune Company represents the amount of resources available, or that become available, for the satisfaction of postpetition liabilities and allowed prepetition claims, as negotiated between the Debtors and their creditors. This value is viewed as the fair value of Reorganized Tribune Company before considering liabilities and is intended to approximate the amount a willing buyer would pay for the assets of Reorganized Tribune Company immediately after emergence from bankruptcy. The “Fresh-Start Combined Balance Sheet” summarizes the Predecessor’s Dec. 30, 2012 combined balance sheet, the reorganization and fresh-start reporting
 
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adjustments that were made to the balance sheet as of Dec. 31, 2012, and the resulting Successor’s combined balance sheet as of Dec. 31, 2012.
In accordance with ASC Topic 852, the Predecessor’s combined statement of comprehensive income for Dec. 31, 2012 includes only (i) reorganization adjustments which resulted in a net gain of $2.862 billion before taxes ($2.894 billion after taxes) and (ii) fresh-start reporting adjustments which resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). The Predecessor’s combined statements of comprehensive income and cash flows for Dec. 31, 2012 exclude the results of operations and cash flows arising from the Predecessor’s business operations on Dec. 31, 2012. Because the Predecessor’s Dec. 31, 2012 results of operations and cash flows were not material, Reorganized Tribune Publishing has elected to report them as part of Reorganized Tribune Publishing’s results of operations and cash flows for the first quarter of 2013.
See Note 3 to Tribune Publishing’s audited combined financial statements for additional information regarding these other reorganization items.
Subchapter S Corporation Election and Subsequent Conversion to C Corporation
On March 13, 2008, Tribune filed an election to be treated as a subchapter S corporation under the Internal Revenue Code (“IRC”), with the election effective as of the beginning of Tribune’s 2008 fiscal year. Tribune also elected to treat nearly all of its subsidiaries, including the subsidiaries through which Tribune Publishing operates, as qualified subchapter S subsidiaries. Subject to certain limitations (such as built-in-gains tax applicable for ten years to gains accrued prior to the election), Tribune and Tribune Publishing were not subject to federal income tax. Although most states in which Tribune and Tribune Publishing operate recognize S corporation status, some impose tax at a reduced rate. Certain Tribune Publishing non-qualified subchapter S subsidiaries were subject to federal and state income taxes as C corporations. On Dec. 31, 2012, Tribune emerged from bankruptcy and issued shares of common stock to non-qualifying S corporation shareholders. As a result, the Tribune S corporation election was terminated and Tribune became taxable as a C corporation beginning on Dec. 31, 2012. As a C corporation, Reorganized Tribune Company is subject to income taxes at a higher effective tax rate. Tribune Publishing’s operations through Dec. 29, 2013 are included in Tribune’s federal and state C corporation income tax returns. Effective Dec. 30, 2013, Tribune Publishing filed an election to be taxed as a separate return filing group.
Shutdown of Daily Press Media Group Printing and Packing Operations
In April 2012, the Daily Press Media Group (“DPMG”) approved a plan to outsource DPMG’s printing and packaging operations located in Newport News, Virginia to Media General Operations, Inc. (d/b/a Richmond Times-Dispatch) (“MG”). Pursuant to the arrangement, MG will provide to DPMG prepress, printing, inserting, newsprint and transportation services for all editions of DPMG’s three newspapers, the Daily Press , The Virginia Gazette , and the Tidewater Review . As of April 27, 2012, the DPMG facility had certain press equipment, prepress equipment and machinery with a net book value of $5.8 million that would no longer be used as a result of the arrangement. Of this amount, inserting equipment with a net book value of $1.5 million was made available to MG for use in connection with contracted print and packaging activities, equipment with a net book value of $1.2 million was transferred to other business units and equipment with a net book value of $3.1 million was sold or scrapped. Accordingly, Tribune Publishing reduced its estimate of the remaining useful life of the equipment to be sold or scrapped and recorded accelerated depreciation of $2.8 million during 2012. Pursuant to the arrangement, DPMG reimbursed MG for the purchase and installation of necessary press modification equipment and systems in the amount of $0.7 million. In addition, Tribune Publishing eliminated approximately 85 employees and incurred severance and related expenses of $0.7 million which are included in selling, general and administrative expenses in Tribune Publishing’s combined statements of comprehensive income.
Transfer of Real Estate Assets to Tribune Real Estate Holding Companies
Tribune and Tribune Affiliates consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan. These restructuring transactions included, among other things, establishing a number of real estate holding companies. On Dec. 21, 2012, the majority of the land and buildings owned by Tribune Publishing were transferred to Tribune’s newly established real estate holding companies.
 
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In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back certain land and buildings that were transferred. Although the properties subject to related party leases were legally transferred to the holding companies, Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing involvement with the properties, which, pursuant to ASC Topic 840, “Leases,” precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result, Tribune Publishing continued to account for and depreciate the carrying values of the transferred properties subject to related party leases. Rent payments under the related party leases were accounted for as dividends to Tribune and Tribune Affiliates.
On Dec. 1, 2013, Tribune Publishing modified the related party leases to eliminate certain protections provided to the landlord in the event of default by the tenant, including the right to collect rent and other balances owed by tenant under the leases utilizing insurance proceeds received by the landlord in the event of damage and otherwise payable to the tenant, as well as the right to collect rent directly from subtenants to the extent all or a portion of the premise is sublet. Pursuant to ASC Topic 840, these provisions had precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result of these modifications, Tribune Publishing determined that it no longer had forms of continuing involvement with the transferred properties and derecognized such properties from its combined financial statements by recording a $337.6 million reduction to net properties and a corresponding reduction to the parent company investment component of equity (deficit) in its combined balance sheet. Tribune Publishing has accounted for these related party leases as operating leases beginning on Dec. 1, 2013.
The remainder of the transferred properties are no longer utilized in the operations of Tribune Publishing; therefore, Tribune Publishing did not enter into related party leases for those properties. During the second half of 2013, Tribune Publishing entered into management agreements with the real estate holding companies pursuant to which it will manage those properties for an initial term of one year, cancellable by the real estate holding companies with a 30-day notice. See Note 6 to Tribune Publishing’s audited combined financial statements for additional information regarding the transfer of real estate assets to Tribune real estate holding companies.
Impact of Distribution from Tribune on Tribune Publishing Financial Statements
Tribune Publishing may incur additional costs associated with being an independent company and for newly established or expanded corporate functions, which include finance, human resources, information technology, facilities, and legal for which Tribune Publishing currently receives expense allocations from Tribune. These allocations are included in operating expenses and totaled $35 million and $32 million for the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively. For the fiscal years 2013, 2012 and 2011, the allocations totaled $141 million, $159 million and $152 million, respectively.
See Note 6 to the audited combined financial statements for further details related to Tribune corporate allocations. Management considers the expense allocation methodology and results to be reasonable for all periods presented; however, Tribune Publishing’s financial statements do not necessarily include all of the expenses that would have been incurred had Tribune Publishing been a separate, stand-alone entity and may not necessarily reflect Tribune Publishing’s results of operations, financial position and cash flows had Tribune Publishing been a stand-alone company during the periods presented. Tribune Publishing believes that cash flow from operations, together with its access to capital markets, will be sufficient to fund the anticipated increases in corporate expenses. See “Unaudited Pro Forma Combined Financial Statements” and the notes thereto for further information.
An affiliate of Tribune is currently party to an affiliation agreement with CareerBuilder whereby Tribune Publishing’s newspapers earn advertising revenues and pay affiliate fees. Pursuant to the terms of the limited liability company agreement with CareerBuilder, if Tribune (together with its affiliates) were to cease to own at least a 30% voting and economic interest in Tribune Publishing’s newspapers, CareerBuilder could
 
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terminate the existing affiliation agreement. However, if Tribune (together with its affiliates) directly or indirectly retains at least a 1% voting and economic interest in Tribune Publishing’s newspapers, Tribune could elect to enter into a modified affiliation agreement that would apply to Tribune Publishing’s newspapers for up to five years. While such a modified affiliation agreement would be on less favorable terms compared to the existing affiliation agreement, Tribune Publishing has no history operating under such a modified affiliation agreement and, thus, is not able to predict how such agreement will impact future revenues and affiliate fees. The unaudited pro forma combined financial statements included elsewhere in this information statement do not reflect any estimates of the impact on revenues or affiliate fees of a modified affiliation agreement because projected amounts would be based on estimates and not factually supportable. Tribune expects to retain a 1.5% interest in Tribune Publishing for the purpose of enabling Tribune Publishing to retain the benefits of the modified affiliation agreement. However, in the future Tribune may cease to retain at least a 1% interest in Tribune Publishing, or other circumstances may occur that could cause Tribune Publishing’s newspapers to cease to earn advertising revenue and pay affiliate fees under an affiliation agreement with CareerBuilder.
Each of Tribune Publishing’s newspapers is currently party to an affiliation agreement with Classified Ventures pursuant to which its newspapers earn advertising revenues and pay affiliate fees. The affiliation agreements are subject to annual renewal. There can be no assurance that, subsequent to the distribution, Tribune Publishing’s newspapers will be able to enter into annual renewals of these affiliation agreements on similar terms, or at all, or continue to earn the same level of advertising revenues or pay the same level of affiliate fees under the affiliation agreements following the distribution.
Tribune Publishing records revenue related to the CareerBuilder and Classified Ventures affiliation agreements for classified advertising products placed on affiliated digital platforms. Such amounts totaled $10 million and $19 million for the three months ended Mar. 30, 2014 and $11 million and $17 million for the three months ended Mar. 31, 2013 related to CareerBuilder and Classified Ventures, respectively. Additionally, such amounts totaled $44 million and $71 million for the fiscal year 2013, $46 million and $66 million for the fiscal year 2012 and $46 million and $61 million for the fiscal year 2011 related to CareerBuilder and Classified Ventures, respectively. These revenues are recorded within advertising revenues in Tribune Publishing’s combined statements of comprehensive income.
Tribune Publishing also pays fees to CareerBuilder and Classified Ventures under the affiliation agreements related to selling classified advertising products. Such amounts totaled $2 million and $7 million for the three months ended Mar. 30, 2014 and $1 million and $5 million for the three months ended Mar. 31, 2013, related to CareerBuilder and Classified Ventures, respectively. Additionally, such amounts totaled $5 million and $24 million for the fiscal year 2013, $5 million and $21 million for the fiscal year 2012 and $5 million and $20 million for the fiscal year 2011 for CareerBuilder and Classified Ventures, respectively. These affiliate fees are recorded as cost of sales in Tribune Publishing’s combined statements of comprehensive income.
On April 1, 2014, Classified Ventures completed the sale of its Apartments.com business. Tribune’s share of the proceeds from the sale was approximately $160 million before taxes, which will be retained by Tribune for general corporate purposes. The sale of Apartments.com will impact Tribune Publishing’s future revenue and affiliate fees from Classified Ventures. For each of the three month periods ended Mar. 30, 2014 and Mar. 31, 2013, Tribune Publishing recorded such revenue and affiliate fees related to Apartments.com of $2 million and $0.2 million, respectively. For the year ended Dec. 29, 2013, Tribune Publishing recorded revenue and affiliate fees associated with Apartments.com of approximately $7 million and $1 million, respectively.
Employee Reductions
Tribune Publishing identified reductions in its staffing levels in the three months ended Mar. 30, 2014, and Mar. 31, 2013 of approximately 25 and 65 positions, respectively. As a result, Tribune Publishing recorded pretax charges for severance and related expenses totaling $0.3 million and $2 million for the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively.
 
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Tribune Publishing identified reductions in its staffing levels in 2013, 2012 and 2011 of approximately 745, 800 and 560 positions, respectively. As a result, Tribune Publishing recorded pretax charges for severance and related expenses totaling $16 million, $14 million and $14 million in 2013, 2012 and 2011, respectively. The accrued liability for severance and related expenses was $5 million at Mar. 30, 2014, $9 million at Dec. 29, 2013 and $4 million at Dec. 30, 2012.
On Nov. 20, 2013, Tribune announced that it would be undertaking certain actions to realign the non-editorial functions across Tribune Publishing to increase the efficiency and effectiveness of its operations. In the fourth quarter of 2013, Tribune Publishing recorded pretax charges for severance and related expenses totaling $9 million for identified reductions in staffing levels of approximately 400 positions, which were due in part to these actions as well as other cost reduction initiatives.
Reorganization Items, Net
ASC Topic 852 requires that the financial statements for periods subsequent to the filing of the Chapter 11 Petitions distinguish transactions and events that are directly associated with the reorganization from the operations of the business. Accordingly, revenues, expenses, realized gains and losses, and provisions for losses directly associated with the reorganization and restructuring of the business are reported in reorganization items, net in the Successor’s and Predecessor’s combined statements of comprehensive income included herein. Reorganization costs generally include provisions and adjustments to reflect the carrying value of certain prepetition liabilities at their estimated allowable claim amounts.
Reorganization items, net included in Tribune Publishing’s audited and unaudited interim combined statements of comprehensive income consisted of the following (in thousands):

 	  	Successor	 	 	   	  	Predecessor	 	
 	  	Three Months
Ended	 	 	Year
Ended	 	 	   	  	 	 	 	Year Ended	 	
 	  	Mar. 30,
2014	 	 	Mar. 30,
2013	 	 	Dec. 29,
2013	 	 	   	  	Dec. 31,
2012	 	 	Dec. 31,
2012	 	 	Dec. 25,
2011	 	
Reorganization items, net:	  				 				 				 	 	  				 				 				
Contract rejections and claim settlements	  	$	(7	) 	 	$	111	  	 	$	111	  	 	 	  	$	—	  	 	$	(978	) 	 	$	412	  	
Other, net	  	 	(2	) 	 	 	(53	) 	 	 	(381	) 	 	 	  	 	—	  	 	 	(468	) 	 	 	(2	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total reorganization (costs) credits, net	  	 	(9	) 	 	 	58	  	 	 	(270	) 	 	 	  	 	—	  	 	 	(1,446	) 	 	 	410	  	
Reorganization adjustments, net	  	 	          —	  	 	 	          —	  	 	 	          —	  	 	 	  	 	2,862,039	  	 	 	          —	  	 	 	          —	  	
Fresh-start reporting adjustments, net	  	 	—	  	 	 	—	  	 	 	—	  	 	 	  	 	(107,486	) 	 	 	—	  	 	 	—	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total reorganization items, net	  	$	(9	) 	 	$	58	  	 	$	(270	) 	 	 	  	$	2,754,553	  	 	$	(1,446	) 	 	$	    410	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Tribune Publishing expects to incur certain expenses pertaining to the Chapter 11 proceedings throughout 2014 and potentially in future periods.
The Predecessor’s combined statement of comprehensive income for Dec. 31, 2012 included other reorganization items totaling $2.755 billion before taxes ($2.842 billion after taxes) arising from reorganization and fresh-start reporting adjustments. Reorganization adjustments, which were recorded to reflect the settlement of prepetition liabilities and changes in the Predecessor’s capital structure arising from the implementation of the Plan, resulted in a net reorganization gain of $2.862 billion before taxes ($2.894 billion after taxes). Fresh-start reporting adjustments, which were recorded as a result of the adoption of fresh-start reporting as of the Effective Date in accordance with ASC Topic 852, resulted in a net loss of $107.5 million before taxes ($52.1 million after
 
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taxes). The net gain resulted primarily from adjusting the Predecessor’s net carrying values for certain assets and liabilities to their fair values in accordance with ASC Topic 805 recording related adjustments to deferred income taxes and eliminating the Predecessor’s accumulated other comprehensive income (loss) as of the Effective Date. See Note 3 to the audited combined financial statements for additional information regarding these other reorganization items.
Results of Operations
As described under “—Significant Events—Fresh-Start Reporting” Tribune Publishing adopted fresh-start reporting on the Effective Date and therefore became a new entity for financial reporting purposes. The adoption of fresh-start reporting has had and will continue to have a significant non-cash impact on Tribune Publishing’s results of operations subsequent to the Effective Date. Tribune Publishing’s combined financial statements as of and for all periods prior to the Effective Date have not been adjusted to reflect any changes in Tribune Publishing’s equity (deficit) as a result of implementing the Plan (as defined above), nor have they been adjusted to reflect any changes to the net carrying values of assets and liabilities as a result of the adoption of fresh-start reporting. Accordingly, Tribune Publishing’s combined financial statements for periods subsequent to the Effective Date may not be comparable in all cases to prior periods. See Note 3 to Tribune Publishing’s audited combined financial statements for further information pertaining to the adoption of fresh-start reporting.
Tribune Publishing’s fiscal years 2013 and 2011 each comprised a 52-week period whereas fiscal year 2012 ended on Dec. 30, 2012 and comprised a 53-week period. The additional week increased Tribune Publishing’s operating revenues by approximately 2%, operating expenses by approximately 1% and operating profit by approximately 9% in 2012.
Three months ended Mar. 30, 2014 versus the Three months ended Mar. 31, 2013
Operating results for the three months ended Mar. 30, 2014 and Mar. 31, 2013 are shown in the table below. References in this discussion to individual markets include daily newspapers in those markets and their related businesses.

 	  	Three Months Ended	 	
(in thousands)	  	Mar. 30, 2014	 	  	Mar. 31, 2013	 	  	% Change	 	
Operating revenues	  	$	416,522	  	  	$	440,513	  	  	 	-5%	  	
	  	 	 	 	  	 	 	 	  				
Operating expenses	  				  				  				
Cost of sales (exclusive of items shown below)	  	 	247,523	  	  	 	259,948	  	  	 	-5%	  	
Selling, general and administrative	  	 	143,882	  	  	 	135,952	  	  	 	+6%	  	
Depreciation	  	 	2,740	  	  	 	5,276	  	  	 	-48%	  	
Amortization	  	 	1,606	  	  	 	1,684	  	  	 	-5%	  	
	  	 	 	 	  	 	 	 	  				
Total operating expenses	  	$	395,751	  	  	$	402,860	  	  	 	-2%	  	
	  	 	 	 	  	 	 	 	  				
Operating profit	  	$	20,771	  	  	$	37,653	  	  	 	-45%	  	
	  	 	 	 	  	 	 	 	  				
Net income	  	$	11,772	  	  	$	21,193	  	  	 	-44%	  	
	  	 	 	 	  	 	 	 	  				
Total operating revenue decreased 5%, or $24 million, in the three months ended Mar. 30, 2014, due primarily to a $19 million decline in advertising revenues. The largest declines in operating revenues were at newspaper operations in Chicago, Los Angeles and Baltimore, which together accounted for $20 million of the operating revenue decline.
Cost of sales, which represented 59% of sales for the three months ended Mar. 30, 2014 and Mar. 31, 2013, decreased 5%, or $12 million, due primarily to lower compensation, newsprint and ink and circulation distribution expenses. Compensation expense decreased 7%, or $6 million, due primarily to reductions in direct
 
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pay realized from continued declines in staffing levels. Newsprint and ink expense decreased 17%, or $7 million, due mainly to a 15% decrease in newsprint consumption. Circulation distribution expense decreased 6%, or $5 million, due to lower print circulation volumes for daily newspapers and commercial delivery of third-party publications. These decreases were partially offset by an increase in rent associated with related party leases of $5 million.
Selling, general and administrative expenses (“SG&A”), which represented 35% and 31% of sales for the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively, increased 6%, or $8 million, in the three months ended Mar. 30, 2014 due to a $3 million increase in rent associated with related party leases, a $3 million increase in the corporate management fee allocation and a $2 million increase in one-time costs related to the planned distribution of Tribune Publishing to the shareholders of Tribune, partially offset by a $1 million decrease in severance expense.
Depreciation and amortization expense decreased 38%, or $3 million, in the three months ended Mar. 30, 2014 primarily due to the derecognition of certain properties under related party leases from Tribune Publishing’s combined financial statements as a result of the modifications of those leases on Dec. 1, 2013.
Operating profit was $21 million in the three months ended Mar. 30, 2014 compared to $38 million in the three months ended Mar. 31, 2013. The decrease was primarily due to the decline in advertising revenues.
Operating Revenues —Total operating revenues, by classification, for the three months ended Mar. 30, 2014 and Mar. 31, 2013 were as follows:

 	  	Three Months Ended	 	
(in thousands)	  	Mar. 30, 2014	 	  	Mar. 31, 2013	 	  	% Change	 	
Advertising	  				  				  				
Retail	  	$	113,341	  	  	$	129,493	  	  	 	-12%	  	
National	  	 	51,003	  	  	 	53,776	  	  	 	-5%	  	
Classified	  	 	68,691	  	  	 	68,710	  	  	 	—   	  	
	  	 	 	 	  	 	 	 	  				
Total advertising	  	 	233,035	  	  	 	251,979	  	  	 	-8%	  	
Circulation	  	 	107,307	  	  	 	107,114	  	  	 	—   	  	
Other	  	 	76,180	  	  	 	81,420	  	  	 	-6%	  	
	  	 	 	 	  	 	 	 	  				
Total operating revenues	  	$	416,522	  	  	$	440,513	  	  	 	-5%	  	
	  	 	 	 	  	 	 	 	  				
Advertising Revenues —Total advertising revenues decreased 8%, or $19 million, in the three months ended Mar. 30, 2014. Retail advertising fell 12%, or $16 million, due to declines in most categories. The largest shortfalls were in the food and drug stores, specialty merchandise, general merchandise, amusements, electronics and personal/professional services categories, which comprised $12 million of the year-over-year decline. Preprint revenues, which are primarily included in retail advertising, decreased 10% or $8 million, due mainly to declines at Chicago and Los Angeles. National advertising revenues fell 5% or $3 million, due to declines in several categories, most notably the financial and movie categories, which together declined by a total of $4 million. Classified advertising revenues were flat compared to the prior year quarter as the decline in the recruitment category of $1 million was offset by increases in several other categories. Digital advertising revenues, which are included in the above categories, increased 5%, or $2 million, from $45 million for the three months ended Mar. 31, 2013 to $47 million for the three months ended Mar. 30, 2014 due to increases in the classified and national categories of $2 million and $1 million, respectively, partially offset by a decline in the retail category of $1 million.
Circulation Revenues —Circulation revenues were flat in the three months ended Mar. 30, 2014 compared to the prior year quarter as higher sales of digital editions at most of the newspapers was largely offset by decreases in print edition sales. Total daily net paid circulation, including digital editions, averaged
 
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1.7 million copies for the three months ended Mar. 30, 2014 up 1% from the comparable prior year period. Total Sunday net paid circulation, including digital editions, for the three months ended Mar. 30, 2014, averaged 2.9 million copies, which was flat compared to the prior year quarter.
Other Revenues —Other revenues are derived from commercial printing and delivery services provided to other newspapers; direct mail advertising; and other publishing-related activities. Other revenues decreased 6%, or $5 million, in the three months ended Mar. 30, 2014 due primarily to declines in commercial printing and commercial delivery revenues. Commercial printing revenues declined $3 million, from $23 million for the three months ended Mar. 31, 2013 to $20 million for the three months ended Mar. 30, 2014, related to certain publications of the Sun-Times Media Group, The Wall Street Journal and The New York Times . Commercial delivery revenues declined $2 million, from $27 million for the three months ended Mar. 31, 2013 to $25 million for the three months ended Mar. 30, 2014. Direct mail revenues declined by $2 million in the three months ended Mar. 30, 2014, which was offset by higher revenue related to other publishing activities.
Operating Expenses —Operating expenses for the three months ended Mar. 30, 2014 and Mar. 31, 2013 were as follows:

 	  	Three Months Ended	 	
(in thousands)	  	Mar. 30, 2014	 	  	Mar. 31, 2013	 	  	% Change	 	
Compensation	  	$	143,712	  	  	$	151,446	  	  	 	-5%	  	
Newsprint and ink	  	 	35,498	  	  	 	42,909	  	  	 	-17%	  	
Circulation distribution	  	 	73,540	  	  	 	78,703	  	  	 	-7%	  	
Depreciation	  	 	2,740	  	  	 	5,276	  	  	 	-48%	  	
Amortization	  	 	1,606	  	  	 	1,684	  	  	 	-5%	  	
Corporate allocations	  	 	35,159	  	  	 	32,064	  	  	 	+10%	  	
Other	  	 	103,496	  	  	 	90,778	  	  	 	+14%	  	
	  	 	 	 	  	 	 	 	  				
Total operating expenses	  	$	395,751	  	  	$	402,860	  	  	 	-2%	  	
	  	 	 	 	  	 	 	 	  				
Operating expenses decreased 2%, or $7 million, in the three months ended Mar. 30, 2014, due to decreases in compensation, newsprint and ink, circulation distribution, depreciation, amortization and corporate allocation expenses, partially offset by increases in other expenses.
Compensation Expense —Compensation expense, which is included in both cost of sales and SG&A expense, decreased 5%, or $8 million, in the three months ended Mar. 30, 2014, primarily due to reductions in direct pay and benefits realized from continued declines in staffing levels.
Newsprint and Ink Expense —Newsprint and ink expense, which is included in cost of sales, decreased 17%, or $7 million, in the three months ended Mar. 30, 2014, due mainly to a 15% decrease in newsprint consumption driven by lower print circulation volumes, which decreased 9% for daily and 6% for Sunday copies of Tribune Publishing’s newspapers, an 11% decline in commercial printing revenue and a 3% decrease in the average cost per ton of newsprint.
Circulation Distribution Expense —Circulation distribution expense, which is included in cost of sales, decreased 7%, or $5 million, due to lower print circulation volumes for daily newspapers and commercial delivery of third party publications. Total daily net paid circulation in the three months ended Mar. 30, 2014 and Mar. 31, 2013 averaged 1.3 million copies and 1.4 million copies, respectively, a decrease of 9%. Total Sunday net paid circulation in the three months ended Mar. 30, 2014 and Mar. 31, 2013 averaged 2.4 million copies and 2.6 million copies, respectively, a decrease of 6%.
Depreciation and Amortization —Depreciation and amortization expense decreased $3 million in the three months ended Mar. 30, 2014 primarily due to the derecognition of certain properties under related party leases from Tribune Publishing’s combined financial statements as a result of the modification of those leases on Dec. 1, 2013.
 
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Corporate Allocations —Corporate allocations are comprised of allocated charges from Tribune for certain corporate support services and are included in SG&A expense. Allocated charges include corporate management fees, technology support costs, general insurance costs and occupancy costs, among others. Corporate allocations increased 10%, or $3 million, in the three months ended Mar. 30, 2014 due primarily to increases in allocated corporate management fees.
Other Expense —Other expense includes outside services, promotion, occupancy and other expenses, which are included in both cost of sales and SG&A expense. Other expense increased 14%, or $13 million, primarily due to an increase in rent expense of $8 million associated with the related party lease agreements that were modified Dec. 1, 2013, $2 million in transaction costs related to the planned distribution of Tribune Publishing to shareholders of Tribune and $2 million in depreciation expense allocated by Tribune.
Loss on Equity Investments, net —Loss on equity investments, net for the three months ended Mar. 30, 2014 and Mar. 31, 2013 was as follows:

 	  	Three Months Ended	 	
(in thousands)	  	Mar. 30, 2014	 	 	Mar. 31, 2013	 	 	% Change	 	
Loss on equity investments, net	  	$	(335	) 	 	$	(351	) 	 	 	5%	 	
	  	 	 	 	 	 	 	 	 				
Income Tax Expense —Income tax expense for the three months ended Mar. 30, 2014 and Mar. 31, 2013 was as follows:

 	  	Three Months Ended	 	
(in thousands)	  	Mar. 30, 2014	 	  	Mar. 31, 2013	 	  	% Change	 	
Income tax expense	  	$	8,653	  	  	$	16,180	  	  	 	-47%	 	
	  	 	 	 	  	 	 	 	  				
For the three months ended Mar. 30, 2014, Tribune Publishing recorded income tax expense of $9 million and had an effective tax rate of 42.4%. This rate differs from the U.S. federal statutory rate due primarily to state income taxes, net of federal benefit, non-deductible expenses, certain transaction costs not fully deductible for tax purposes and the domestic production activities deduction. For the three months ended Mar. 31, 2013, Tribune Publishing recorded income tax expense of $16 million and had an effective tax rate of 43.3%. This rate differs from the U.S. federal statutory rate due primarily to state income taxes, net of federal benefit and the impact of non-deductible expenses.
 
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Fiscal 2013 versus Fiscal 2012
Operating results for the fiscal years ended Dec. 29, 2013 and Dec. 30, 2012 are shown in the table below. References in this discussion to individual markets include daily newspapers in those markets and their related businesses.

 	  	Year Ended	 	
 	  	Successor	 	  	   	  	Predecessor	 	  	% Change	 	
(in thousands)	  	Dec. 29, 2013	 	  	   	  	Dec. 30, 2012	 	  			
Operating revenues	  	$	1,795,107	  	  	 	  	$	1,913,814	  	  	 	-6%	  	
	  	 	 	 	  	 	  	 	 	 	  				
Operating expenses	  				  	 	  				  				
Cost of sales (exclusive of items shown below)	  	 	1,010,078	  	  	 	  	 	1,143,128	  	  	 	-12%	  	
Selling, general and administrative	  	 	590,069	  	  	 	  	 	642,368	  	  	 	-8%	  	
Depreciation	  	 	21,851	  	  	 	  	 	80,280	  	  	 	-73%	  	
Amortization	  	 	6,580	  	  	 	  	 	6,382	  	  	 	+3%	  	
	  	 	 	 	  	 	  	 	 	 	  				
Total operating expenses	  	$	1,628,578	  	  	 	  	$	1,872,158	  	  	 	-13%	  	

Operating profit	  	$	166,529	  	  	 	  	$	41,656	  	  	 	*   	  	

Net income	  	$	94,094	  	  	 	  	$	28,395	  	  	 	*   	  	

*	Represents positive or negative change in excess of 100%	
Total operating revenue decreased 6%, or $119 million, in 2013, due primarily to a decline in advertising revenues at most newspapers. The largest declines in advertising revenues were at Los Angeles, Chicago and South Florida, which together accounted for $75 million of the advertising revenue decline.
Cost of sales, which represented 56% of sales in 2013 compared to 60% in 2012, decreased 12%, or $133 million, in 2013, due primarily to lower compensation and newsprint and ink expenses. Compensation expense decreased 20%, or $89 million, due primarily to lower pension expense and reductions in direct pay realized from continued declines in staffing levels. Pension expense included in cost of sales decreased $51 million in 2013 largely as a result of adopting fresh-start reporting on the Effective Date and direct pay decreased $27 million primarily due to the continued reductions in staffing levels. Newsprint and ink expense decreased 15%, or $28 million, due mainly to a 17% decrease in newsprint consumption. Circulation distribution expense decreased 5%, or $17 million, due to lower print circulation volumes and a $7 million decrease in postage and carrier delivery fees resulting primarily from lower volumes of total market coverage products.
SG&A expenses, which represented 33% of sales in 2013 compared to 34% in 2012, declined 8%, or $52 million, in 2013 due to lower compensation expense and corporate allocations. Compensation expense decreased 13%, or $39 million, due primarily to lower pension expense as a result of the adoption of fresh-start reporting on the Effective Date. Corporate allocations decreased 12%, or $18 million, due to decreases in allocated occupancy costs, the corporate management fee and technology service center support costs.
Depreciation and amortization decreased 67%, or $58 million, in 2013, primarily as a result of the adoption of fresh-start reporting on the Effective Date, which lowered the value of depreciable properties.
Operating profit was $167 million in 2013 compared to $42 million in 2012. The increase was primarily due to reductions in operating expenses due to continued staffing declines as well as lower pension expense and depreciation expense as a result of the adoption of fresh-start reporting on the Effective Date.
 
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Operating Revenues —Total operating revenues, by classification, for 2013 and 2012 were as follows:

 	  	Year Ended	 	
 	  	Successor	 	  	   	  	Predecessor	 	  	 	 	
(in thousands)	  	Dec. 29, 2013	 	  	   	  	Dec. 30, 2012	 	  	% Change	 	
Advertising	  				  	 	  				  				
Retail	  	$	558,355	  	  	 	  	$	615,201	  	  	 	-9%	  	
National	  	 	213,618	  	  	 	  	 	247,282	  	  	 	-14%	  	
Classified	  	 	280,904	  	  	 	  	 	295,765	  	  	 	-5%	  	
	  	 	 	 	  	 	  	 	 	 	  				
Total advertising	  	 	1,052,877	  	  	 	  	 	1,158,248	  	  	 	-9%	  	
Circulation	  	 	428,615	  	  	 	  	 	424,629	  	  	 	+1%	  	
Other	  	 	313,615	  	  	 	  	 	330,937	  	  	 	-5%	  	
	  	 	 	 	  	 	  	 	 	 	  				
Total operating revenues	  	$	1,795,107	  	  	 	  	$	1,913,814	  	  	 	-6%	  	
	  	 	 	 	  		  	 	 	 	  				
Advertising Revenues —Total advertising revenues decreased 9%, or $105 million, in 2013. Retail advertising fell 9%, or $57 million, due to declines in most categories. The largest shortfalls were in the food and drug stores, specialty merchandise, general merchandise and electronics categories, which comprised $31 million of the year-over-year decline. Preprint revenues, which are primarily included in retail advertising, decreased 6%, or $24 million, due to declines at all daily newspapers. National advertising revenues fell 14%, or $34 million, due to decreases in most categories, most notably the movies, financial, technology, health care, and telecom categories, which comprised $31 million of the year-over-year decline. Classified advertising revenues decreased 5%, or $15 million, due to declines in nearly all categories. The largest shortfalls were in the automotive, recruitment and real estate categories, which collectively comprised $9 million of the year-over-year decline. Digital advertising revenues, which are included in the above categories, were $192 million in both 2013 and 2012, as declines in retail and national categories of $3 million and $1 million, respectively, were offset by an increase in the classified category of $4 million.
Circulation Revenues —Circulation revenues were up 1%, or $4 million, in 2013. Print circulation revenues decreased by less than $1 million to $420 million primarily due to higher home delivery rates, up 14% on average compared to the prior year, offset by declines in average net paid print copies of 8% on Sunday and 12% daily (Monday-Friday). Circulation revenues from digital editions increased $4 million in 2013 due to an increase in net paid circulation volume of digital editions of 66% for daily issues and 90% for Sunday issues, compared to the prior year. The largest overall circulation revenue increase in 2013 was at Los Angeles. Total daily net paid circulation, including digital editions, in 2013 and 2012 averaged 1.7 million copies, down 1%, Total Sunday net paid circulation, including digital editions, for 2013 and 2012 averaged 2.9 million copies, up less than 1%.
Other Revenue— Other revenues declined 5%, or $17 million, in 2013, primarily due to declines in commercial printing revenues, which declined $9 million from $96 million in 2012 to $87 million in 2013, and lower insertion and delivery revenue, which declined $5 million from $107 million in 2012 to $102 million in 2013, for third-party publications, including certain publications of the Sun-Times Media Group, The Wall Street Journal and The New York Times. These declines were partially offset by an increase in direct marketing revenue, which increased by $2 million from $73 million in 2012 to $75 million in 2013.
 
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Operating Expenses —Operating expenses for 2013 and 2012 were as follows:

 	  	Year Ended	 	
 	  	Successor	 	  	   	  	Predecessor	 	  	 	 	
(in thousands)	  	Dec. 29, 2013	 	  	   	  	Dec. 30, 2012	 	  	% Change	 	
Compensation	  	$	597,882	  	  	 	  	$	725,285	  	  	 	-18%	  	
Newsprint and ink	  	 	162,196	  	  	 	  	 	190,563	  	  	 	-15%	  	
Circulation distribution	  	 	309,310	  	  	 	  	 	326,367	  	  	 	-5%	  	
Depreciation	  	 	21,851	  	  	 	  	 	80,280	  	  	 	-73%	  	
Amortization	  	 	6,580	  	  	 	  	 	6,382	  	  	 	+3%	  	
Corporate allocations	  	 	140,786	  	  	 	  	 	159,103	  	  	 	-12%	  	
Other	  	 	389,973	  	  	 	  	 	384,178	  	  	 	+2%	  	
	  	 	 	 	  	 	  	 	 	 	  				
Total operating expenses	  	$	1,628,578	  	  	 	  	$	1,872,158	  	  	 	-13%	  	
	  	 	 	 	  		  	 	 	 	  				
Operating expenses decreased 13%, or $244 million, in 2013, due to decreases in compensation, newsprint and ink, circulation distribution, depreciation and corporate allocation expenses, partially offset by increases in other expenses and amortization.
Compensation Expense —Compensation expense, which is included in both cost of sales and SG&A expense, decreased by $127 million in 2013, due primarily to lower pension expense and reductions in direct pay realized from continued declines in staffing levels. Pension expense decreased $91 million in 2013 largely as a result of the adoption of fresh-start reporting on the Effective Date, and direct pay decreased $33 million, primarily due to continued reductions in staffing levels. Compensation expense in 2013 included $16 million of severance and related expenses for the elimination of approximately 745 positions. Compensation expense in 2012 included $14 million of severance and other expenses related to the elimination of approximately 800 positions.
Newsprint and Ink Expense —Newsprint and ink expense, which is included in cost of sales, decreased 15% or $28 million in 2013, due mainly to a 17% decrease in newsprint consumption driven by lower print circulation volumes, which declined 12% for daily and 8% for Sunday across the newspapers. The largest declines in newsprint and ink expense were within the Chicago and Los Angeles markets, which comprised $20 million of the year-over-year change.
Circulation Distribution Expense —Circulation distribution expense, which is included in cost of sales, decreased 5%, or $17 million, due to lower print circulation volumes and a $7 million decrease in postage and carrier delivery fees resulting from lower volumes of total market coverage products. Total daily net paid circulation in 2013 and 2012 averaged 1.3 million copies and 1.5 million copies, respectively, down 12%. Total Sunday net paid circulation for 2013 and 2012 averaged 2.5 million copies and 2.7 million copies, respectively, down 8%.
Corporate Allocations —Corporate allocations are comprised of allocated charges from Tribune and Tribune Affiliates for certain corporate support services and are included in SG&A expense. Allocated charges include corporate management fees, technology support costs, general insurance costs and occupancy costs, among others. Corporate allocations decreased 12%, or $18 million, in 2013, primarily due to decreases in the corporate management fee, technology support costs and allocated occupancy costs. The decline in the corporate management fee was the result of lower corporate pension expense. The decrease in technology support costs is the result of the one-time charge of $6 million for the write-down of certain software applications in 2012, offset by $2 million of rent expense associated with the shared corporate office space. See Note 6 to the audited combined financial statements for further details related to Tribune corporate allocations.
Allocated occupancy costs were $7 million in 2012. There were no allocated occupancy costs in 2013 due to the Dec. 21, 2012 transfer of certain real estate properties to Tribune. Prior to the transfer on Dec. 21,
 
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2012, Tribune Publishing received a cost allocation from Tribune for the use of certain shared office space. Beginning in 2013, the corporate occupancy allocation was replaced with rent expense in connection with related party lease agreements entered into in 2013 between Tribune and Tribune Publishing for the shared office space which is included in other operating expenses in 2013. See Note 6 to the audited combined financial statements for further details related to these property transfers.
Other Expense —Other expense includes outside services, promotion, occupancy and other expenses, which are included in both cost of sales and SG&A expense. Other expense increased 2%, or $6 million, principally due to one-time transaction costs of $15 million related to the spin-off transaction, primarily consisting of accounting, legal, consulting and advisory fees, partially offset by general cost reductions.
Loss on Equity Investments, net —Loss on equity investments, net for 2013 and 2012 were as follows:

 	  	Year Ended	 	
 	  	Successor	 	 	   	  	Predecessor	 	 	 	 	
(in thousands)	  	Dec. 29, 2013	 	 	   	  	Dec. 30, 2012	 	 	% Change	 	
Loss on equity investments, net	  	$	(1,187	) 	 	 	  	$	(2,349	) 	 	 	-49%	  	
	  	 	 	 	 		  	 	 	 	 				
Loss on equity investments, net totaled $1 million in 2013 and was down 49%, or $1 million, from 2012. The decrease in the loss was primarily due to stronger operating results reported by CIPS and MCT and the absence of losses from an equity method investment that was written down in 2012.
Income Tax Expense —Income tax expense for 2013 and 2012 was as follows:

 	  	Year Ended	 	
 	  	Successor	 	  	   	  	Predecessor	 	  	 	 	
(in thousands)	  	Dec. 29, 2013	 	  	   	  	Dec. 30, 2012	 	  	% Change	 	
Income tax expense	  	$	70,992	  	  	 	  	$	3,294	  	  	 	*   	  	

*	Represents positive or negative change in excess of 100%	
Prior to the Effective Date, Tribune and its subsidiaries consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan. These transactions had no impact on reported income tax expense for 2012. On the Effective Date and in accordance with and subject to the terms of the Plan, Reorganized Tribune Company converted from a subchapter S corporation to a C corporation under the IRC and therefore was subject to federal income taxes. This conversion also affected Tribune subsidiaries that were treated as qualified subchapter S subsidiaries, including certain legal entities included in the accompanying combined financial statements of Tribune Publishing. The effect of this conversion was recorded in connection with the adoption of fresh-start reporting as more fully described in Note 3 of the accompanying audited combined financial statements. Reorganized Tribune Publishing is subject to income taxes at a higher effective tax rate beginning in 2013. Accordingly, essentially all of Tribune Publishing’s deferred income tax assets and liabilities were reinstated at a higher effective tax rate as of the Effective Date.
On Dec. 31, 2012, Tribune emerged from bankruptcy and issued shares of stock to non-qualifying S corporation shareholders. As a result, Tribune’s S corporation election was terminated and Tribune became taxable as a C corporation beginning on Dec. 31, 2012. For the year ended Dec. 29, 2013, Tribune Publishing recorded income tax expense of $71 million and had an effective tax rate of 43.0%. This rate differs from the U.S. federal statutory rate due primarily to state income taxes, net of federal benefit and the impact of non-deductible expenses. In 2012, while Tribune Publishing operated as a subchapter S corporation, Tribune Publishing recorded income tax expense of $3 million and had an effective tax rate of 10.4%. However, had Tribune Publishing been a C corporation in 2012, Tribune Publishing’s tax expense would have been $14 million at an effective rate of 43.9%.
 
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Fiscal 2012 versus Fiscal 2011
Operating results for the fiscal years ended Dec. 30, 2012 and Dec. 25, 2011 are shown in the table below. References in this discussion to individual markets include daily newspapers in those markets and their related businesses.

 	 	Year Ended	 	
(in thousands)	 	Dec. 30, 2012	 	  	Dec. 25, 2011	 	  	% Change	 	
Operating revenues	 	$	1,913,814	  	  	$	1,915,932	  	  	 	—   	  	

Operating expenses	 				  				  				
Cost of sales (exclusive of items shown below)	 	 	1,143,128	  	  	 	1,154,419	  	  	 	-1%	  	
Selling, general and administrative	 	 	642,368	  	  	 	630,599	  	  	 	+2%	  	
Depreciation	 	 	80,280	  	  	 	80,616	  	  	 	—   	  	
Amortization	 	 	6,382	  	  	 	5,729	  	  	 	+11%	  	
	 	 	 	 	  	 	 	 	  				
Total operating expenses	 	$	1,872,158	  	  	$	1,871,363	  	  	 	—   	  	

Operating profit	 	$	41,656	  	  	$	44,569	  	  	 	-7%	  	

Net income	 	$	28,395	  	  	$	41,614	  	  	 	-32%	  	
	 	 	 	 	  	 	 	 	  				
Total operating revenues decreased less than 1%, or $2 million, in 2012, as lower advertising revenues were offset by increases in circulation and other revenues. The largest declines in advertising revenues were at Los Angeles and Chicago.
Cost of sales, which represented 60% of sales in both 2012 and 2011, decreased 1%, or $11 million, in 2012 due primarily to lower compensation and circulation distribution expenses. Compensation expense decreased 1%, or $6 million, primarily due to reductions in direct pay of $20 million realized from continued declines in staffing levels, partially offset by an increase in pension expense of $16 million. Circulation distribution expense decreased 6%, or $19 million, due to lower print circulation volumes at Tribune Publishing’s newspapers and lower postage costs due to reduced total market coverage product volumes.
SG&A expenses, which represented 34% of sales in 2012 compared to 33% in 2011, increased 2%, or $12 million in 2012 due primarily to increases in compensation expense and corporate allocations. Compensation expense increased 2%, or $6 million, due primarily to an increase in pension expense included in SG&A of $12 million, offset by an $8 million reduction in other employee benefits primarily due to continued declines in staffing levels. Corporate allocations increased 5%, or $7 million, primarily due to an increase in the technology service center support costs and corporate management fee, partially offset by a decrease in other service center support costs.
Operating profit decreased 7%, or $3 million, in 2012 due largely to the decline in operating revenues.
 
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Operating Revenues —Total operating revenues, by classification, for 2012 and 2011 were as follows:

	 	 	Year Ended	  	
(in thousands)	 	Dec. 30, 2012	 	  	Dec. 25, 2011	 	  	% Change	 	
Advertising	 				  				  				
Retail	 	$	615,201	  	  	$	652,301	  	  	 	-6%	  	
National	 	 	247,282	  	  	 	277,821	  	  	 	-11%	  	
Classified	 	 	295,765	  	  	 	311,471	  	  	 	-5%	  	
	 	 	 	 	  	 	 	 	  				
Total advertising	 	 	1,158,248	  	  	 	1,241,593	  	  	 	-7%	  	
Circulation	 	 	424,629	  	  	 	390,433	  	  	 	+9%	  	
Other	 	 	330,937	  	  	 	283,906	  	  	 	+17%	  	
	 	 	 	 	  	 	 	 	  				
Total operating revenues	 	$	1,913,814	  	  	$	1,915,932	  	  	 	—   	  	
	 	 	 	 	  	 	 	 	  				
Advertising Revenues —Total advertising revenues decreased 7%, or $83 million, in 2012. Retail advertising fell 6%, or $37 million, due primarily to declines in the department stores, health care, hardware/home improvement and other retail categories, which comprised $36 million of the year-over-year decline. Preprint revenues, which are primarily included in retail advertising, decreased 3%, or $11 million, due to declines at most daily newspapers. National advertising revenues declined 11%, or $31 million, due to decreases in most categories, most notably the telecom/wireless, movies and financial categories, which comprised $20 million of the year-over-year decline. Classified advertising revenue decreased 5%, or $16 million, due to declines in recruitment and real estate, which collectively declined $9 million in the year-over-year period. Digital advertising revenues, which are included in the above categories, increased 5%, or $10 million, in 2012.
Circulation Revenues —Circulation revenues were up 9%, or $34 million, in 2012. Print circulation revenues increased by $30 million, or 8%, to $420 million primarily due to higher home delivery rates, up 16% on average compared to the prior year, partially offset by declines in average net paid print copies of 8% on Sunday and 11% daily (Monday-Friday). Circulation revenues in 2012 also reflected $4 million of digital circulation revenues due to digital offerings Tribune Publishing began implementing during 2011. In 2011, digital circulation revenue was negligible. Circulation revenues increased in 2012 at all newspapers with the largest improvements at Chicago and Los Angeles. Total daily net paid circulation, including digital editions, in 2012 and 2011 averaged 1.7 million and 1.8 million copies, respectively, a decline of 4%. Total Sunday net paid circulation, including digital editions, for 2012 and 2011 averaged 2.9 million and 3.0 million copies, respectively, down 2%.
Other Revenues —Other revenues grew 17%, or $47 million, in 2012 primarily due to a $44 million increase in commercial printing revenues and higher insertion and delivery revenues for third-party publications, including certain publications of the Sun-Times Media Group, The Wall Street Journal and The New York Times , in the Chicago metropolitan area and other markets, partially offset by a decrease in revenue from direct mail operations.
 
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Operating Expenses —Operating expenses for 2012 and 2011 were as follows:

 	 	Year Ended	 	
(in thousands)	 	Dec. 30, 2012	 	  	Dec. 25, 2011	 	  	% Change	 	
Compensation	 	$	725,285	  	  	$	725,645	  	  	 	—   	  	
Newsprint and ink	 	 	190,563	  	  	 	188,115	  	  	 	+1%	  	
Circulation distribution	 	 	326,367	  	  	 	345,651	  	  	 	-6%	  	
Depreciation	 	 	80,280	  	  	 	80,616	  	  	 	—   	  	
Amortization	 	 	6,382	  	  	 	5,729	  	  	 	+11%	  	
Corporate allocations	 	 	159,103	  	  	 	151,691	  	  	 	+5%	  	
Other	 	 	384,178	  	  	 	373,916	  	  	 	+3%	  	
	 	 	 	 	  	 	 	 	  				
Total operating expenses	 	$	1,872,158	  	  	$	1,871,363	  	  	 	—   	  	
	 	 	 	 	  	 	 	 	  				
Operating expenses increased less than 1%, or $1 million, in 2012, as increases in newsprint and ink, corporate allocations and other expenses were largely offset by decreases in compensation and circulation distribution expenses.
Compensation Expense —Compensation expense, which is included in both cost of sales and SG&A expense, in 2012 decreased less than $1 million, due to reductions in direct pay of $18 million and other employee benefits of $10 million primarily due to continued declines in staffing levels, offset by an increase in pension expense of $28 million. Compensation expense in 2012 included $14 million of severance and related expenses for the elimination of approximately 800 positions. Compensation expense in 2011 included $14 million of severance and related expenses for the elimination of approximately 560 positions.
Newsprint and Ink Expense —Newsprint and ink expense, which is included in cost of sales, in 2012 increased 1%, or $2 million, due to increases of less than 1% in the average newsprint price per ton and a 1% increase in consumption.
Circulation Distribution Expense —Circulation distribution expense, which is included in cost of sales, decreased 6%, or $19 million, due to an $8 million decrease in postage costs resulting from lower volumes of total market coverage products and lower print circulation volumes. Total daily net paid circulation in 2012 and 2011 averaged 1.5 million copies and 1.7 million copies, respectively, down 11%. Total Sunday net paid circulation for 2012 and 2011 averaged 2.7 million copies and 2.9 million copies, respectively, down 8%.
Corporate Allocations —Corporate allocations are comprised of allocated charges from Tribune and Tribune Affiliates for certain corporate support services and are included in SG&A expense. Allocated charges include corporate management fees, technology support costs, general insurance and occupancy costs, among others. Corporate allocations increased 5%, or $7 million, in 2012 primarily due to an increase in the technology service center support costs and corporate management fee, partially offset by a decrease in service center support costs. The increase in technology service center support costs is the result of higher web hosting and operating expenses and a one-time charge of $6 million for the write-down of certain software applications in 2012. The rise in the corporate management fee is the result of increased corporate pension expense. The decrease in service center support costs is due to the transition of nearly all shared service center operations to BLM in 2012. See Note 6 to the audited combined financial statements for further details related to Tribune corporate allocations.
Other Expense —Other expense includes outside services, sales and marketing, occupancy and other expenses, which are included in both cost of sales and SG&A expense. Other expense increased 3%, or $10 million, largely due to outside services.
 
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Loss on Equity Investments, net —Loss on equity investments, net for 2012 and 2011 was as follows:
													
 	 	Year Ended	 	
(in thousands)	 	Dec. 30, 2012	 	 	Dec. 25, 2011	 	 	% Change	 	
Loss on equity investments, net	 	$	(2,349	) 	 	$	(900	) 	 	 	*	  	

*	Represents positive or negative change in excess of 100%	
Loss on equity investments, net totaled $2 million in 2012, up $1 million from 2011. The increase in the loss was primarily due to weaker operating results reported by CIPS and Locality Labs. Tribune acquired a 35% membership interest in Locality Labs on April 16, 2012.
Income Tax Expense —Income tax expense for 2012 and 2011 was as follows:

 	 	Year Ended	 	
(in thousands)	 	Dec. 30, 2012	 	  	Dec. 25, 2011	 	  	% Change	 	
Income tax expense	 	$	3,294	  	  	$	2,539	  	  	 	+30%	  	
	 	 	 	 	  	 	 	 	  				
Tribune Publishing’s operations are included in Tribune’s federal and state S corporation income tax returns for 2012 and 2011, with the exception of certain non-qualified subchapter S subsidiaries. For purposes of the audited combined financial statements, Tribune Publishing computed income taxes as if it were filing separate returns. The effective tax rate on pretax income was 10.4% and 5.8% for the fiscal years ended Dec. 30, 2012 and Dec. 25, 2011, respectively. The effective tax rate increased in 2012 primarily due to increased federal income taxes related to non-qualified subchapter S subsidiaries.
Liquidity and Capital Resources
Historically, Tribune provided capital, cash management and other treasury services to Tribune Publishing. Tribune will continue to provide these services to Tribune Publishing until the separation is consummated. As part of these services, a majority of the cash balances are swept from Tribune Publishing to Tribune on a daily basis. Following the separation, Tribune Publishing will no longer participate in capital management with Tribune and Tribune Publishing’s ability to fund its future cash needs will depend on its ongoing ability to generate and raise cash in the future. Tribune Publishing believes that its future cash from operations, the expected approximately $75 million of net proceeds from the Senior Term Loan Facility not used to fund the cash dividend to Tribune and access to borrowings under the Senior ABL Facility will provide adequate resources to fund its operating and financing needs for the foreseeable future. Tribune Publishing’s access to, and the availability of, financing in the future will be impacted by many factors, including its credit rating, the liquidity of the overall capital markets and the current state of the economy. There can be no assurances that Tribune Publishing will have access to capital markets on acceptable terms.
Immediately prior to the distribution, Tribune Publishing intends to pay a cash dividend of up to $275 million to Tribune. Tribune Publishing expects to fund such cash dividend with a portion of the proceeds from the approximately $350 million Senior Term Loan Facility that management anticipates arranging prior to the distribution. In addition, prior to the distribution, Tribune Publishing also expects to enter into the Senior ABL Facility with aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million to be used for working capital and other liquidity needs. Tribune Publishing expects the Senior ABL Facility will be undrawn at the time of the distribution. In addition, we expect to enter into an arrangement to allow cash backed letters of credit, with approximately $25 million issued on our behalf. We also expect to have approximately $25 million of additional letters of credit issued under the Senior ABL Facility as of the distribution date, for a total of approximately $50 million of letters of credit. The Senior ABL Facility is expected to include flexibility for additional letters of credit to be issued thereunder. See “Financing Arrangements.”
 
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Three Months Ended Mar. 30, 2014 and Mar. 31, 2013
The table below details the total operating, investing and financing activity cash flows for the three months ended Mar. 30, 2014 and Mar. 31, 2013:

 	  	Three Months Ended	 	
 	  	Mar. 30, 2014	 	 	Mar. 31, 2013	 	
Net cash provided by operating activities	  	$	57,623	  	 	$	58,769	  	
Net cash used for investing activities	  	 	(3,112	) 	 	 	(6,336	) 	
Net cash used for financing activities	  	 	(55,665	) 	 	 	(53,541	) 	
	  	 	 	 	 	 	 	 	
Net decrease in cash	  	$	(1,154	) 	 	$	(1,108	) 	
	  	 	 	 	 	 	 	 	
Cash flow generated from operating activities is Tribune Publishing’s primary source of liquidity. Net cash provided by operating activities was $58 million for the three months ended Mar. 30, 2014 down $1 million from $59 million for the three months ended Mar. 31, 2013. The decrease was primarily driven by lower operating results as a result of the decline in advertising revenues partially offset by favorable changes in working capital of $8 million for three months ended Mar. 30, 2014 principally due to changes in accrued employee compensation and benefits as a result of continued declines in staffing levels.
Net cash used for investing activities totaled $3 million in the three months ended Mar. 30, 2014 and was comprised of $1 million in capital expenditures, $1 million in investments and $1 million related to acquisitions. Net cash used for investing activities totaled $6 million in the three months ended Mar. 31, 2013 and was comprised almost entirely of capital expenditures.
Net cash used for financing activities totaled $56 million in the three months ended Mar. 30, 2014 compared to $54 million in the three months ended Mar. 31, 2013 and primarily represents transactions with Tribune and Tribune Affiliates.
Fiscal Years 2013, 2012 and 2011
The table below details the total operating, investing and financing activity cash flows for 2013, 2012 and 2011:

(in thousands)	  	Successor	 	 	 	  	Predecessor	 	
	  	Year Ended	 	 	 	  	Year Ended	 	
	  	Dec. 29, 2013	 	 	 	  	Dec. 30, 2012	 	 	Dec. 25, 2011	 	
Net cash provided by operating activities	  	$	147,719	  	 		  	$	138,146	  	 	$	103,464	  	
Net cash used for investing activities	  	 	(19,942	) 	 		  	 	(62,549	) 	 	 	(47,827	) 	
Net cash used for financing activities	  	 	(131,851	) 	 		  	 	(69,057	) 	 	 	(52,767	) 	
	  	 	 	 	 		  	 	 	 	 	 	 	 	
Net increase (decrease) in cash	  	$	(4,074	) 	 		  	$	6,540	  	 	$	2,870	  	
	  	 	 	 	 		  	 	 	 	 	 	 	 	
In conjunction with the adoption of fresh-start reporting on the Effective Date, Tribune Publishing recorded adjustments that resulted in no net impact on cash flows for Dec. 31, 2012. See Note 3 to the combined financial statements for further information on the adoption of fresh-start reporting.
Cash flow generated from operating activities is Tribune Publishing’s primary source of liquidity. Net cash provided by operating activities was $148 million in 2013, up $10 million from $138 million in 2012. The increase was due to improved operating results driven by reductions in operating expenses as a result of lower pension expense and continued staffing declines. This was partially offset by $13 million of unfavorable changes in working capital, primarily due to higher cash collections of accounts receivable in 2012 as a result of the additional week in the fourth quarter. Net cash provided by operating activities was $138 million in 2012, up $35
 
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million from $103 million in 2011. The improvement was primarily due to favorable changes in working capital, most notably higher cash collections for accounts receivable and lower cash payments for compensation as a result of continued declines in staffing levels.
Net cash used for investing activities totaled $20 million in 2013 and included capital expenditures of $20 million. Net cash used for investing activities totaled $63 million in 2012 and included capital expenditures of $52 million as well as $10 million of acquisitions and investments. The decline in capital expenditures in 2013 was due to the completion of several multi-year projects for printing and packaging machinery and equipment used for commercial printing, as well as lower spending for building and facility improvements. Net cash used for investing activities totaled $48 million in 2011 and was primarily due to capital expenditures of $46 million. The increase in capital expenditures in 2012 was due primarily to building and leasehold improvements at certain facilities.
Net cash used for financing activities totaled $132 million, $69 million and $53 million in 2013, 2012 and 2011, respectively. The increase in cash used for financing activities in 2013 was primarily due to related party dividends associated with the related party lease agreements entered into during 2013, and an increase in net outflows for other transactions with Tribune and Tribune Affiliates.
Contractual Obligations and Off-Balance Sheet Arrangements
Leases and Other Commitments
The table below represents future minimum payments for third party and related party leases and expected future payments under certain other purchase obligations as of Dec. 29, 2013. There have been no material changes subsequent to Dec. 29, 2013.

(in thousands)	  	Total	 	  	2014	 	  	2015-2016	 	  	2017-2018	 	  	More than
5 years	 	
Third party operating leases	  	$	55,671	  	  	$	19,314	  	  	$	23,379	  	  	$	8,911	  	  	$	4,067	  	
Related party operating leases (1)	  	 	275,683	  	  	 	35,394	  	  	 	74,860	  	  	 	68,851	  	  	 	96,578	  	
Other purchase obligations (2)	  	 	15,712	  	  	 	3,079	  	  	 	6,359	  	  	 	5,117	  	  	 	1,157	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	$	347,066	  	  	$	57,787	  	  	$	104,598	  	  	$	82,879	  	  	$	101,802	  	

(1)	In 2013, Tribune Publishing entered into related party lease agreements with the newly established Tribune real estate holding companies to lease back the land and buildings that were transferred on Dec. 21, 2012. See Note 6 to Tribune Publishing’s audited combined financial statements for additional information regarding the transfer of real estate assets to Tribune real estate holding companies.	
(2)	Other purchase obligations relates to the purchase of transportation and news and market data services.	
During the fourth quarter of 2012 and prior to the Effective Date, Tribune and Tribune Affiliates consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan. These restructuring transactions included, among other things, establishing a number of real estate holding companies. Prior to Tribune’s emergence from Chapter 11 bankruptcy, the majority of the land and buildings owned by the wholly-owned subsidiaries of Tribune Publishing were transferred to Tribune’s newly established real estate holding companies. In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back the land and buildings that were transferred on Dec. 21, 2012. Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing involvement with the properties subject to related party leases, which, pursuant to ASC Topic 840, precluded Tribune Publishing from derecognizing those properties from its combined financial statements. In connection with the above, Tribune Publishing continued to account for and depreciate the carrying value of the transferred properties subject to related party leases until the effective date of the modified lease agreements.
 
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On Dec. 1, 2013, Tribune Publishing modified the related party leases to eliminate certain protections provided to the landlord in the event of default by the tenant, including the right to collect rent and other balances owed by tenant under the leases utilizing insurance proceeds received by the landlord in the event of damage and otherwise payable to the tenant, as well as the right to collect rent directly from subtenants to the extent all or a portion of the premise is sublet. Pursuant to ASC Topic 840, these provisions had precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result of these modifications, Tribune Publishing determined that it no longer had forms of continuing involvement with the transferred properties. Accordingly, in December 2013, Tribune Publishing derecognized such properties from its combined financial statements by recording a $337.6 million reduction to net properties and a corresponding reduction to the parent company investment component of equity (deficit) in its combined balance sheet.
Tribune Publishing has accounted for these related party leases as operating leases. Tribune Publishing has recognized in its combined statements of comprehensive income $9.6 million and $10.6 million of rent expense for the three months ended Mar. 30, 2014 and the fiscal year 2013, respectively, recorded in cost of sales and selling, general and administrative expense, as appropriate. Additionally, during 2013, Tribune Publishing entered into certain operating lease agreements with the real estate holding companies for portions of shared office space which was not previously owned by Tribune Publishing.
Tribune Publishing has funding obligations with respect to its other postretirement plans and its participation in a number of multiemployer defined benefit pension plans. See Note 12 to the audited combined financial statements for further information.
Tribune Publishing is a party to various arrangements with third party suppliers to purchase newsprint. Under these arrangements, Tribune Publishing agreed to purchase 35,000 metric tons of newsprint in 2014, subject to certain limitations, based on market prices at the time of purchase.
Off-Balance Sheet Arrangements
Tribune Publishing does not currently have any off-balance sheet arrangements that are material or reasonably likely to be material to its financial condition or results of operations.
Capital Spending
Tribune Publishing’s capital expenditures totaled $1 million and $6 million in the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively, $20 million in 2013, $52 million in 2012 and $46 million in 2011. The decrease in capital spending for the three months ended Mar. 30, 2014 compared to the three months ended Mar. 31, 2013 was due primarily to completion in 2013 of certain facility and equipment upgrades. The decrease in 2013 capital spending, as compared to 2012, was due primarily to the completion of several multi-year projects for printing and packaging machinery and equipment used for commercial printing, as well as lower spending for building and facility improvements. The increase in 2012 capital expenditures, as compared to 2011, was due primarily to building and leasehold improvements at certain facilities. Tribune Publishing anticipates that capital expenditures for the full fiscal year 2014 will be approximately $40 million, excluding one-time capital expenditures required as a result of the distribution.
Critical Accounting Policies
Tribune Publishing’s significant accounting policies are summarized in Note 4 to the audited combined financial statements. These policies conform with U.S. GAAP and reflect practices appropriate to Tribune Publishing’s businesses. The preparation of Tribune Publishing’s combined financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the combined financial statements and accompanying notes thereto. Actual results could differ from these estimates. Tribune Publishing bases its estimates on past experience and assumptions that management believes are reasonable under the circumstances and evaluates its policies, estimates and assumptions on an ongoing basis.
 
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Tribune Publishing’s critical accounting policies and estimates relate to presentation, revenue recognition, accounts receivable and allowance for doubtful accounts, goodwill and intangible assets, impairment review of long-lived assets, pension and other postretirement benefits, self-insurance liabilities, income taxes and stock-based compensation. Management continually evaluates the development, selection and disclosure of Tribune Publishing’s critical accounting policies and estimates and the application of these policies and estimates. In addition, there are other items within the combined financial statements that require the application of accounting policies and estimation, but are not deemed to be critical accounting policies and estimates. Changes in the estimates used in these and other items could have a material impact on Tribune Publishing’s combined financial statements.
Presentation —The combined financial statements of Tribune Publishing are presented in accordance with U.S. GAAP. Certain assets of Tribune and Tribune Affiliates that are not owned by Tribune Publishing and are otherwise specifically identifiable or attributable to Tribune Publishing and are necessary to present the combined financial results on a stand-alone basis have also been included in Tribune Publishing’s combined financial statements.
The accompanying combined financial statements as of and for all periods presented prior to the Effective Date have not been adjusted to reflect any changes in the Tribune Publishing Debtors’ capital structure as a consequence of reorganization under Chapter 11 nor have they been adjusted to reflect any changes in the fair value of assets and liabilities as a result of the adoption of fresh-start reporting in accordance with ASC Topic 852. Such adjustments were applied to Tribune Publishing’s combined financial statements as of the Effective Date. See Note 3 to the audited combined financial statements for a presentation of the impact of the Plan and the adoption of fresh-start reporting on Tribune Publishing’s combined balance sheet as of the Effective Date.
All intercompany accounts within Tribune Publishing have been eliminated in consolidation. All significant intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates have been included within the combined financial statements and are considered to be effectively settled through equity contributions or distributions or through cash payments at the time the transactions were recorded. The accumulated net effect of intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates are included in the parent company investment component of equity (deficit). The total net effect of these intercompany transactions is reflected in the combined statements of cash flows as financing activities.
Revenue Recognition —Tribune Publishing’s primary sources of revenue are from the sales of advertising space in published issues of its newspapers and other publications and on websites owned by, or affiliated with, Tribune Publishing; distribution of preprinted advertising inserts in its publications; sales of newspapers and other publications to distributors and individual subscribers; and the provision of commercial printing and delivery services to third parties, primarily other newspaper companies. Newspaper advertising revenue is recorded, net of agency commissions, when advertisements are published in newspapers. Website advertising revenue is recognized ratably over the contract period or as services are delivered, as appropriate. Commercial printing and delivery services revenues, which are included in other revenues, are recognized when the product is delivered to the customer or as services are provided, as appropriate. Proceeds from publication subscriptions are deferred and are included in revenue on a pro rata basis over the term of the subscriptions. Tribune Publishing records rebates when earned as a reduction of advertising revenue.
Accounts Receivable and Allowance for Doubtful Accounts —Tribune Publishing’s accounts receivable are primarily due from advertisers and circulation-related accounts. Credit is extended based on an evaluation of each customer’s financial condition, and generally collateral is not required. Tribune Publishing maintains an allowance for uncollectible accounts, rebates and volume discounts. The allowance for uncollectible accounts is determined based on historical write-off experience and any known specific collectability exposures. At Mar. 30, 2014, Dec. 29, 2013 and Dec. 30, 2012, Tribune Publishing’s allowance for accounts receivable was $12 million, $13 million and $13 million, respectively. Tribune Publishing’s allowance for uncollectible accounts
 
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could be impacted by many factors, including customer creditworthiness or bankruptcy and a shift in customer profiles, which may require additional reserves.
Goodwill and Other Intangible Assets —Tribune Publishing reviews goodwill and other indefinite-lived intangible assets, which include newspaper mastheads, for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles–Goodwill and Other.” Under ASC Topic 350, the impairment review of other intangible assets not subject to amortization must be based on estimated fair values. Goodwill and other intangibles not subject to amortization totaled $48 million, $47 million and $6 million at Mar. 30, 2014, Dec. 29, 2013 and Dec. 30, 2012, respectively.
Tribune Publishing’s annual impairment review measurement date is in the fourth quarter of each year. As of the fourth quarter of 2013, Tribune Publishing conducted its annual goodwill impairment test utilizing the two-step impairment test and its annual impairment test of other indefinite-lived intangible assets in accordance with ASC Topic 350. No impairment charges were recorded in 2013 or 2012.
The estimated fair values of other intangible assets subject to the annual impairment review, which include only newspaper mastheads, are calculated based on projected future discounted cash flow analyses. The determination of estimated fair values requires the use of assumptions, including assumptions regarding revenue and market growth as well as specific economic factors in the publishing industry. These assumptions reflect Tribune Publishing’s best estimates, but these items involve inherent uncertainties based on market conditions generally outside of Tribune Publishing’s control.
The valuation of goodwill and other intangible assets requires many judgments, assumptions and estimates of several critical factors, including projected revenues and related growth rates, projected operating margins and cash flows, estimated income tax rates, capital expenditures, market multiples and discount rates, as well as specific economic factors such as royalty rates for newspaper mastheads. Fair value estimates for each of Tribune Publishing’s indefinite-lived intangible assets are inherently sensitive to changes in these estimates. Adverse changes in expected operating results and/or unfavorable changes in other economic factors result in non-cash impairment charges in the future under ASC Topic 350. The amount by which the estimated fair values of Tribune Publishing’s individual mastheads exceeded book value as of the fourth quarter of 2013 ranged from 18% to 43%.
Impairment Review of Long-Lived Assets —In accordance with ASC Topic 360, “Property, Plant and Equipment,” Tribune Publishing evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may be impaired. The carrying value of a long-lived asset or asset group is considered impaired when the projected future undiscounted cash flows to be generated from the asset or asset group over its remaining depreciable life are less than its current carrying value. Tribune Publishing measures impairment based on the amount by which the carrying value exceeds the estimated fair value of the long-lived asset or asset group. The fair value is determined primarily by using the projected future cash flows discounted at a rate commensurate with the risk involved as well as market valuations. Losses on long-lived assets to be disposed of are determined in a similar manner, except that the fair values are reduced for an estimate of the cost to dispose or abandon.
No impairment charges under ASC Topic 360 were recorded during the three years in the period ended Dec. 29, 2013. Adverse changes in expected operating results and/or unfavorable changes in other economic factors used to estimate future undiscounted cash flows could result in non-cash impairment charges in the future under ASC Topic 360.
Tribune Pension Plans and Other Postretirement Benefits —Retirement benefits are provided to eligible employees of Tribune Publishing through defined benefit pension plans sponsored by Tribune or by unions. Under Tribune-sponsored defined benefit pension plans, pension benefits are primarily a function of both
 
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the years of service and the level of compensation for a specified number of years, depending on the plan. It is Tribune’s policy to fund the minimum for Tribune-sponsored defined benefit pension plans as required by the Employee Retirement Income Security Act of 1974 (“ERISA”). Contributions made to union-sponsored plans are based upon collective bargaining agreements.
Tribune also provides certain health care and life insurance benefits for retired Tribune Publishing employees through postretirement benefit plans sponsored by Tribune. The expected cost of providing these benefits is accrued over the years that the employees render services. It is Tribune’s policy to fund postretirement benefits as claims are incurred.
Retirement benefits obligations pursuant to the Tribune-sponsored defined benefit pension plans have historically been an obligation of Tribune. Therefore, Tribune Publishing accounts for costs associated with these defined benefit pension plans as a participant in multi-employer plans in accordance with ASC Topic 715, “Compensation—Retirement Benefits.” ASC Topic 715 provides that an employer that participates in a multi-employer defined benefit plan is not required to report a liability beyond the contributions currently due and unpaid to the plan. As no such amounts are due and unpaid by Tribune Publishing, no assets or liabilities relative to the obligations under the Tribune-sponsored defined benefit pension plans have been included in the combined balance sheets.
The weighted average assumptions used each year in accounting for Tribune’s pension and other postretirement benefits, prior to being allocated to Tribune Publishing, are summarized in the below table:

 	 	Pension Plans	 	  	Other Postretirement
Plans	 	
 	 	  2013  	 	  	  2012  	 	  	    2013    	 	  	    2012    	 	
Discount rate for expense	 	 	3.85%	  	  	 	4.10%	  	  	 	3.15%	  	  	 	3.65%	  	
Discount rate for obligation	 	 	—	  	  	 	—	  	  	 	3.95%	  	  	 	3.15%	  	
Increase in future salary levels for expense	 	 	3.50%	  	  	 	3.50%	  	  	 	—	  	  	 	—	  	
Long-term rate of return on plans’ assets for expense	 	 	7.50%	  	  	 	7.50%	  	  	 	—	  	  	 	—	  	
Tribune recognizes the overfunded or underfunded status of its postretirement benefit plans as an asset or liability in its consolidated balance sheets and recognizes changes in that funded status in the year in which changes occur through comprehensive income (loss). The portions of the liabilities for postretirement health care and life insurance benefits, the related net periodic benefit costs and other comprehensive income (loss) have been allocated to Tribune Publishing and presented within the combined financial statements. The amounts included within the combined financial statements were actuarially determined based on amounts allocable to eligible Tribune Publishing employees.
For purposes of measuring postretirement health care costs for 2013, Tribune assumed a 7.5% annual rate of increase in the per capita cost of covered health care benefits. The rate was assumed to decrease gradually to 5% for 2019 and remain at that level thereafter. For purposes of measuring postretirement health care obligations at Dec. 29, 2013, Tribune assumed an 8.0% annual rate of increase in the per capita cost of covered health care benefits. The rate was assumed to decrease gradually to 5% for 2021 and remain at that level thereafter.
 
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Assumed health care cost trend rates have a significant effect on the amounts reported for health care plans. As of Dec. 29, 2013, a 1% change in assumed health care cost trend rates would have the following effects on Tribune Publishing’s portion of postretirement benefits service and interest cost and projected benefit obligation (in thousands):

 	  	1% Increase	 	  	1% Decrease	 	
Service cost and interest cost	  	$	149	  	  	$	(134	) 	
Projected benefit obligation	  	$	2,530	  	  	$	(2,286	) 	
In 2013, Tribune Publishing made contributions of $4 million to its other postretirement plans. Tribune Publishing expects to contribute approximately $5 million to its other postretirement plans in 2014.
Benefit payments expected to be paid to eligible Tribune Publishing employees under the Reorganized Tribune’s other postretirement benefit plans are summarized below (in thousands). The benefit payments reflect expected future service, as appropriate.

 	  	Other
Postretirement
Benefits	 	
2014	  	$	5,080	  	
2015	  	$	5,046	  	
2016	  	$	4,860	  	
2017	  	$	4,728	  	
2018	  	$	4,486	  	
Thereafter	  	$	18,867	  	
Tribune Publishing contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multiemployer plans are different from single-employer plans in that assets contributed are pooled and may be used to provide benefits to employees of other participating employers. If a participating employer withdraws from or otherwise ceases to contribute to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. Alternatively, if Tribune Publishing chooses to stop participating in one of its multiemployer plans, it may incur a withdrawal liability based on the unfunded status of the plan. Tribune Publishing contributed $2 million and $1 million for the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively, and $4 million, $4 million and $3 million in 2013, 2012 and 2011, respectively, to multiemployer plans.
Self-Insurance —Tribune self-insures for certain employee medical and disability income benefits, and insures with a high deductible for workers’ compensation, automobile and general liability claims. The recorded liabilities for self-insured risks are calculated using actuarial methods and are not discounted. Tribune deductibles for the insured coverages are generally $1 million per occurrence, depending on the applicable policy period. As a portion of the liabilities and expense related to these self-insurance and insurance plans relate to Tribune Publishing employees, both the liability and expense applicable to those employees has been presented within these financial statements. The recorded liabilities for self-insured risks at Mar. 30, 2014, Dec. 29, 2013 and Dec. 30, 2012 totaled $44 million, $48 million and $48 million, respectively, and included $0.1 million classified as liabilities subject to compromise at Dec. 30, 2012.
Income Taxes —Tribune Publishing filed an election effective Dec. 30, 2013 to be taxed as a C Corporation. Accordingly, for the period ended Mar. 30, 2014, Tribune Publishing has computed income taxes as a separate return filing group. For the three months ended Mar. 31, 2013, Tribune Publishing’s operations are included in Tribune’s federal and state C Corporation income tax returns. For the purposes of these combined financial statements, Tribune Publishing has computed its Mar. 2013 income taxes as if it were filing separate returns. Current income taxes payable are settled with Tribune through the equity (deficit) account.
 
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In connection with the Debtors’ emergence from Chapter 11, Reorganized Tribune Company converted from a subchapter S corporation to a C corporation under the IRC including the qualified subchapter S subsidiaries included in these combined financial statements. The effect of this conversion was recorded in connection with Reorganized Tribune Publishing’s implementation of fresh-start reporting. Accordingly, essentially all of Reorganized Tribune Publishing’s deferred tax assets and liabilities at the Effective Date were reinstated at a higher effective tax rate.
Provisions for federal and state income taxes are calculated on reported pretax earnings based on current tax laws and also include, in the current period, the cumulative effect of any changes in tax rates from those used previously in determining deferred tax assets and liabilities. Taxable income reported to the taxing jurisdictions in which Tribune Publishing operates often differs from pretax earnings because some items of income and expense are recognized in different time periods for income tax purposes. Tribune Publishing provides deferred taxes on these temporary differences in accordance with ASC Topic 740, “Accounting for Income Taxes.” Taxable income also may differ from pretax earnings due to statutory provisions under which specific revenues are exempt from taxation and specific expenses are not allowable as deductions. The combined tax provision and related accruals include estimates of the potential taxes and related interest as deemed appropriate. These estimates are reevaluated and adjusted, if appropriate, on a quarterly basis. Although management believes its estimates and judgments are reasonable, Tribune Publishing may incur tax liabilities that are significantly higher or lower than that which has been provided by Tribune Publishing.
ASC Topic 740 addresses the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Under ASC Topic 740, a company may recognize the tax benefit of an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. ASC Topic 740 requires the tax benefit recognized in the financial statements to be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC Topic 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure. See Note 11 to Tribune Publishing’s audited combined financial statements for further discussion.
Tribune Publishing’s effective tax rate and income tax expense could vary from estimated amounts due to future impacts of various items, including changes in tax laws, tax planning and forecast financial results. Management believes current estimates are reasonable; however, actual results can differ from these estimates.
Stock-Based Compensation —Beginning in the second quarter of 2013, Tribune issued stock awards under its new equity incentive plan and accounts for the award grants as equity-classified awards in accordance with ASC Topic 718, “Compensation—Stock Compensation.” Pursuant to ASC Topic 718, stock-based compensation costs are measured on the grant date based on the estimated fair value of the award and recognized on a straight-line basis over the requisite service period for the entire award.
Tribune Publishing utilizes the Black-Scholes option pricing model to estimate the fair value of stock awards and the resulting stock-based compensation expense. The use of the Black-Scholes model requires the use of estimates such as an expected term of the awards and volatility of the common stock. Furthermore, management is required to estimate future forfeitures when recording the stock-based compensation expense. Although management believes the assumptions used to estimate stock-based compensation expense are reasonable, actual results may be materially different. See Note 12 to the audited combined financial statements for further discussion.
Quantitative and Qualitative Disclosures about Market Risk
As of the date of this information statement, Tribune Publishing does not have material exposure to market risk. Immediately prior to the distribution, Tribune Publishing expects to enter into the Senior Term Loan Facility with aggregate gross proceeds of approximately $350 million, as well as the Senior ABL Facility with
 
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aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million, with a sublimit for the issuance of letters of credit. In addition, we expect to enter into an arrangement for a cash backed letter of credit of approximately $25 million to be issued on our behalf. See “Financing Arrangements.” The entrance into the Senior Credit Facilities, which are expected to be at variable rates of interest, could expose Tribune Publishing to risks from changes in interest rates in the future.
 
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 BUSINESS
Overview
Tribune Publishing is a leading newspaper publishing and local news and information gathering company that operates daily newspapers and related websites in eight major markets as well as a number of ancillary businesses that leverage certain of the assets of those businesses. Our core publications have served their respective communities with local, regional, national and international news and information for an average of more than 150 years. We operate over 60 affiliated websites and mobile applications, including a primary online product for each local newspaper, which is an expanded version of the newspaper, providing local, national and international news along with feature reporting.
The eight principal daily newspapers that we publish are the Los Angeles Times , the Chicago Tribune , the Sun Sentinel, serving southeast Florida, the Orlando Sentinel , The Baltimore Sun , the Hartford Courant , The Morning Call , serving Pennsylvania’s Lehigh Valley, and the Daily Press , serving the Virginia Peninsula. We also publish The Capital , serving Annapolis, Maryland, and the Carroll County Times, serving Carroll County, Maryland . Collectively, Tribune is the second-largest newspaper publisher in the country, based on Sunday print circulation.

 	  	 	 	  	 	 	  	Circulation (000s) 1	 	 	 	  	Digital (millions) 4	 	
  	  	Year first
published	 	  	DMA 2
rank	 	  	Daily	 	  	Sunday	 	  	Print Local
Market
Leadership 3	 	 	  	  	Unique
visitors	 	  	Page views  	 	  	Digital
Local
Market
Leadership 5	 	
										
	  	 	1882	  	  	 	2	  	  	 	673	  	  	 	956	  	  	 	#1	  	 		  	 	49	  	  	 	204  	  	  	 	#1	  	
										
	  	 	1847	  	  	 	3	  	  	 	440	  	  	 	790	  	  	 	#1	  	 		  	 	17	  	  	 	122  	  	  	 	#1	  	
										
	  	 	1910	  	  	 	16	  	  	 	163	  	  	 	218	  	  	 	#1	  	 		  	 	6	  	  	 	37  	  	  	 	#1	  	
										
	  	 	1876	  	  	 	18	  	  	 	151	  	  	 	258	  	  	 	#1	  	 		  	 	6	  	  	 	41  	  	  	 	#1	  	
										
	  	 	1838	  	  	 	27	  	  	 	174	  	  	 	296	  	  	 	#1	  	 		  	 	6	  	  	 	37  	  	  	 	#1	  	
										
	  	 	1764	  	  	 	30	  	  	 	120	  	  	 	181	  	  	 	#1	  	 		  	 	4	  	  	 	29  	  	  	 	#1	  	
										
 6	  	 	1895	  	  	 	54	  	  	 	80	  	  	 	128	  	  	 	#3	  	 		  	 	2	  	  	 	14  	  	  	 	#5	  	
										
	  	 	1896	  	  	 	45	  	  	 	52	  	  	 	85	  	  	 	#2	  	 		  	 	1	  	  	 	8  	  	  	 	#1	  	
										
	  	 	1884	  	  	 	27	  	  	 	29	  	  	 	34	  	  	 	#2	  	 		  	 	0.6	  	  	 	2  	  	  	 	N/A	  	
										
	  	 	1911	  	  	 	27	  	  	 	21	  	  	 	25	  	  	 	#3	  	 	 	  	 	0.1	  	  	 	1  	  	  	 	N/A	  	
Note: Circulation and digital traffic statistics may include minimal duplication among the media properties
1 Alliance for Audited Media; Includes print and digital circulation; Total circulation is average for six months ended March 31, 2014; DMA net combined audience except for Sun Sentinel which is NDM net combined audience
2 Nielsen estimates as of September 2013
3 Kantar Media/TNS; Ranking based on total media market advertising spend within the respective DMA for April 2013 - March 2014
4 Average over the three months ended March 31, 2014. Digital audience is based on Tribune’s internal metrics
5 Based on Total Digital Market Audience Reach % yearly average as compared to digital presence of local peers within same DMA
6 The Morning Call focuses on the Lehigh Valley region within the Philadelphia DMA (#4), ranks 3rd and 5th for print and digital local market leadership in the Philadelphia DMA respectively
Our three primary revenue streams are advertising and marketing services, circulation and third party printing and distribution.
Our advertising and marketing services are delivered to customers through three main channels: ROP, preprint and digital. ROP advertisement is comprised of advertisements that are printed in the newspapers while preprint advertising primarily consists of glossy, color inserts that are included with the newspapers. Digital advertising is primarily related to advertising revenue sold on our owned and operated newspaper websites.
We have historically adjusted our cost structure to partially off-set the secular declines in the allocation of advertising funds to print media. Cost reduction initiatives have included centralization of shared departments such as finance and other corporate administrative functions, reductions in printing capacity and, in one case, outsourcing printing to another newspaper publisher, and continued investment in more flexible, efficient infrastructure and technology.
 
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We expect that the regional groups and their local brands will be integral to the future success of the company. Each group will continue to create local content and sell local advertising, and such efforts will be supported by the larger company with an organizational structure and centralized functions that maximize local operations and company-wide profitability.
The following is a discussion of each of the local markets which, collectively, form Tribune Publishing.
Los Angeles Times Media Group
The Los Angeles Times Media Group is a leading provider of news and information in the Los Angeles metropolitan area. Its operations are principally comprised of the publication of the Los Angeles Times and its related businesses. The Los Angeles Times has been published continuously since 1881 and today has the fourth-largest daily circulation of any newspaper in the U.S. and is the most-widely read metropolitan newspaper in California and the western U.S. The Los Angeles market ranks second in the nation in terms of population. Additionally, the Los Angeles Times Media Group provides an integrated and comprehensive direct mail service.
In addition to two daily editions of the Los Angeles Times , the Los Angeles Times Media Group produces a number of other publications targeting the unique cultural attributes of the Los Angeles market. Its free Spanish newspaper, Hoy , provides local, national and international news and features of interest to the largest Hispanic market in the U.S. The group also publishes The Envelope , which covers the entertainment industry. Numerous other daily and semi-weekly community newspapers, which are either inserted into the paper in selected geographic areas or distributed to homes and through vending boxes, provide additional targeted local news coverage to key demographics.
With a 4.4 million net combined readership audience as of March 2014, the Los Angeles Times holds a 27% share of the Los Angeles media market. The Los Angeles Times and latimes.com lead the total local newspaper (56%) and total local online news (45%) advertising spending markets.
The Los Angeles Times Media Group currently prints and transports various local and national daily publications in the Los Angeles market.
In 2013, the Los Angeles Times primary website, latimes.com, averaged 38.3 million unique visitors and 199.4 million page views per month. For the first three months of 2014, latimes.com averaged 49.4 million unique visitors and 203.5 million page views per month.
Chicago Tribune Media Group
The Chicago Tribune Media Group is a leading provider of news and information in the Chicago area and ranks as the largest news organization in the midwest U.S. Its operations are principally comprised of the publication of the Chicago Tribune and its related businesses. Founded in 1847, the Chicago Tribune’s print and online coverage attracts the largest news-seeking audience in the Midwest. The Chicago market ranks third in the nation in terms of population. The Chicago Tribune ranks eleventh in the U.S. for average daily paid newspaper circulation and fourth on Sunday for paid circulation. The Chicago Tribune Media Group also operates several targeted publications, including (i)  RedEye , a free daily publication targeting young, urban commuters; (ii)  Hoy , a free Spanish language newspaper; (iii)  Chicago Magazine , an upscale monthly paid magazine; (iv)  The Mash , a weekly newspaper for high school students; and (v)  Triblocal , the largest community-driven weekly newspaper in Chicagoland. Additionally, the Chicago Tribune Media Group provides an integrated and comprehensive direct mail service and operates a News & Features division that syndicates comics, editorial content, feature articles, opinion columns, games and puzzles to a number of print and online publishers.
The Chicago Tribune Media Group currently prints and transports various local and national daily publications in the Chicagoland market.
 
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With a 3.3 million net combined readership audience, as of March 2014, the Chicago Tribune holds a 28% share of the Chicago media market. chicagotribune.com holds a 38% share of the Chicago online media market.
In 2013, the Chicago Tribune’s primary website, chicagotribune.com, averaged 16.2 million unique visitors and 135.1 million page views per month. For the first three months of 2014, chicagotribune.com averaged 17.4 million unique visitors and 121.7 million page views per month.
Florida Media Group
The Florida Media Group is a leading provider of news and information in Southern and Central Florida. Its operations are principally comprised of the publication of the Sun Sentinel , the Orlando Sentinel and their related businesses. Our Florida properties share significant resources in the areas of advertising sales, editorial coverage and back office administration and have implemented significant regionalization and integration strategies. The Florida Media Group offers direct marketing and direct mail services through Tribune Direct/Orlando in addition to printing and distribution services for other publications in the Southern and Central Florida markets.
The Sun Sentinel is the major daily newspaper serving the Broward/Palm Beach County market. The Miami/Fort Lauderdale/Miami Beach metropolitan area, which includes Broward and Palm Beach counties, ranks seventh in the nation in terms of population.
The Orlando Sentinel , which has been published since 1876, is the only major daily newspaper in the Orlando market and serves a six county area in Central Florida. The Orlando market ranks 26th in the nation in terms of population.
The Florida Media Group also serves the news and information needs of South Florida through a variety of niche publications, including el Sentinel , South Florida’s largest Spanish language newspaper by circulation, and its companion website elsentinel.com . Other publications produced by the Florida Media Group in South Florida include (i)  City & Shore , a bimonthly lifestyle magazine; (ii)  Jewish Journal , one of the largest Jewish publications in the U.S. by circulation, offering a collection of weekly newspapers serving South Florida’s Jewish community; (iii)  South Florida Parenting , a monthly magazine providing parenting information and resources for local families; (iv) the Sentinel Express , a free weekly publication used to distribute advertising and content to newspaper non-subscribers in Central Florida; (v) and Auto Finder , a free niche product and SouthFlorida.com, a local entertainment website. Other key niche publications include (i) the SunSentinel Deals Delivered/WRAP-UP, South Florida’s weekly shopping and deals section, and (ii) SunSentinel Special Delivery, a select market coverage product. In addition, elsentinel.com targets a diverse and fast growing segment in Florida, with a distribution of 136,000 copies per week.
With a 1.2 million net combined readership audience as of March 2014, the Sun Sentinel holds a 16% share of the South Florida media market.
In 2013, the Sun Sentinel’s primary website sun-sentinel.com averaged 3.9 million unique visitors and 36.7 million page views per month. For the first three months of 2014, sun-sentinel.com averaged 5.9 million unique visitors and 37.3 million page views per month.
With a 1.1 million net combined readership audience as of March 2014, the Orlando Sentinel holds a 25% share of the Orlando, Florida media market.
In 2013, the Orlando Sentinel’s primary website, orlandosentinel.com, averaged 4.4 million unique visitors and 37.1 million page views per month. For the first three months of 2014, orlandosentinel.com averaged 5.9 million unique visitors and 41.4 million page views per month.
 
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Baltimore Sun Media Group
The Baltimore Sun Media Group has published The Baltimore Sun , Maryland’s largest newspaper, since 1837. The Baltimore Sun Media Group is Maryland’s #1 media company, with nine out of ten Baltimore-area households receiving at least one product on a monthly basis. The Baltimore market ranks 20th in the nation in terms of population. The Baltimore Sun Media Group’s operations also include The Capital , Carroll County Times , Baltimore City Paper, Howard County Times , Columbia Flier , and The Aegis , along with b , a free weekly publication targeting young adults, several magazines and phone directories.
The Baltimore Sun Media Group currently prints and transports various local and national daily publications in the Baltimore market.
With a 1.1 million net combined readership audience as of March 2014, T he Baltimore Sun and the other Baltimore Sun Media Group publications hold a 32% share of the total media market in its DMA. The Capital holds a 45% share of the local Annapolis, Maryland newspaper market.
In 2013, The Baltimore Sun’s primary website, baltimoresun.com, averaged 4.9 million unique visitors and 34.4 million page views per month. For the first three months of 2014, baltimoresun.com averaged 5.6 million unique visitors and 36.6 million page views per month.
In 2013, The Capital ’s primary website, capitalgazette.com , averaged 0.5 million unique visitors and 2.1 million page views per month. For the first three months of 2014, capitalgazette.com averaged 0.6 million unique visitors and 2.3 million page views per month.
In 2013, the Carroll County Times’ primary website, carrollcountytimes. com , averaged 0.1 million unique visitors and 0.6 million page views per month. For the first three months of 2014, carrollcountytimes.com averaged 0.1 million unique visitors and 0.6 million page views per month.
Daily Press
Founded in 1896 and based in Newport News, Virginia, the Daily Press serves the Virginia Peninsula market, which includes Newport News, Hampton, Williamsburg and eight other cities and counties. This market, together with Norfolk, Portsmouth, Virginia Beach and Chesapeake, is known as Virginia’s Hampton Roads region and is the 35th largest market in the nation in terms of population. The Daily Press is the only major daily newspaper in its primary market, although it competes with other regional and national newspapers, as well as with other media, and has the largest news and sales staffs on the Virginia Peninsula. The Daily Press also publishes The Virginia Gazette , a semi-weekly publication which primarily serves Williamsburg, Virginia and the surrounding counties, the weekly Tidewater Review , published for the greater West Point, Virginia community and several special interest publications. The Daily Press has outsourced its printing to another local publisher.
With a 357,000 net combined readership audience as of March 2014, the Daily Press holds a 17% share of the Norfolk/Newport News media market.
In 2013, the Daily Press’s primary website, dailypress.com , averaged approximately 0.9 million unique visitors and 7.9 million page views per month. For the first three months of 2014, dailypress.com averaged 1.4 million unique visitors and 7.5 million page views per month.
The Hartford Courant
The Hartford Courant is a leading provider of news, information and entertainment in Connecticut. Founded in 1764, the Hartford Courant is the oldest continuously published newspaper in North America. It is
 
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the most widely circulated and read newspaper in Connecticut and primarily serves the state’s northern and central regions, including the Hartford market, which ranks 45th in the nation in terms of population. The group also publishes three weekly alternative newspapers in Connecticut and operates a shared-mail company that distributes advertising supplements to more than one million households in Connecticut and Massachusetts.
The Hartford Courant , as of March 2014, holds a 50% share of the local Connecticut newspaper market and courant.com holds a 21% share of the online local business market.
In 2013, the Hartford Courant ’s primary website, courant.com, averaged 2.3 million unique visitors and had 27.8 million page views per month. For the first three months of 2014, courant.com averaged 3.5 million unique visitors and 28.8 million page views per month.
The Morning Call
The Morning Call , published since 1895 in Allentown, Pennsylvania, is the major regional newspaper for nine counties in eastern Pennsylvania and one county in western New Jersey. Its primary market, the Allentown-Bethlehem-Easton metropolitan area, is the 62nd largest market in the nation in terms of population and the largest U.S. market without a local television station. The Morning Call , with a 458,000 net combined readership audience as of March 2014, also offers full service direct marketing and saturation preprint delivery through non-subscriber distribution.
In 2013, The Morning Call’s primary website, themorningcall.com , averaged 1.4 million unique visitors and 13.2 million page views per month. For the first three months of 2014, themorningcall.com averaged 1.7 million unique visitors and 14.2 million page views per month.
Other Publishing Related Businesses
ForSaleByOwner.com is a national consumer-to-consumer focused real estate website. The site has been the largest “by owner” website in the country since 1999. The majority of the revenue generated by ForSaleByOwner.com is e-commerce, but approximately one third is generated through an in-house call center and strategic partnerships with service providers in the real estate industry. The business generates the majority of its revenue by selling listing packages directly to home sellers who receive online advertising, home pricing tools, marketing advice, yard signs and technical support. ForSaleByOwner.com also sells packages that allow home sellers to syndicate to other national websites such as Zillow and Realtor.com as well as their local multiple listing service. In 2013, ForSaleByOwner.com averaged 1.9 million unique visitors and 11.3 million page views per month. For the first three months of 2014, ForSaleByOwner.com averaged 2.7 million unique visitors and 14.3 million page views per month.
MCT is a news service that provides us with access to comprehensive news and image services. MCT also serves more than 1,200 media clients, online information services and information resellers across the globe. In addition, we have investments in CIPS (50%) and HomeFinder.com (33%). CIPS is a Southern California based provider of alternative distribution services for advertising preprints. HomeFinder.com is an online platform for marketing homes for sale.
Competitive Strengths
We believe our competitive strengths include the following:
Large footprint in attractive and diverse markets
We are the second largest newspaper group in the United States, based on Sunday print circulation. The Los Angeles Times and the Chicago Tribune are the second and third largest newspapers, respectively, in the U.S. based on combined digital and print Sunday circulation. Regionally, The Baltimore Sun covers news and
 
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information in the Baltimore metropolitan area while the Orlando Sentinel covers central Florida and the Sun Sentinel covers southern Florida. On the local side, The Morning Call , the Daily Press and the Hartford Courant cover the local news and information in Allentown, PA, Newport News, VA and Hartford, CT respectively.
Our publications serve eight of the top 70 markets, including two of the top three, in the United States by population, positioning us as a leading local media provider with a national footprint and access to prominent national advertisers. We believe that the long-standing presence of our publications in their respective markets makes these newspapers and their associated websites sought-after news and information sources as well as attractive advertising platforms.
Diverse revenue sources
Our revenue is primarily derived from advertising, circulation and commercial services, including printing and delivery of third-party publications. In 2013, we generated approximately 59% of our revenue from the sale of advertising across our print and digital products, approximately 24% from circulation and the remaining amount from other sources. Faced with a challenging macroeconomic environment and a decline of traditional ROP advertising due to, among other things, the expansion of digital alternatives and structural changes in advertisers’ marketing mix, we have diversified our revenue by focusing on non-ROP opportunities in digital, circulation, commercial print and delivery and direct mail.
Integrated digital strategy enables enhanced monetization through digital advertising and subscription paywalls
We believe we have high quality, user-friendly branded websites for each of our newspapers, and we strive to cultivate and develop new products and services to improve the online experience for our digital readers and provide compelling online, interactive advertising opportunities for our clients. Our broad portfolio of digital properties has strengthened our engagement with readers and expanded our reach for advertisers. We have also monetized our digital subscriber base through the implementation of various forms of “paywalls” on our newspaper-affiliated websites. The extent of initial access to free content varies by newspaper, but each requires a subscription after a specified number of page or story views. Pricing structure depends on, among other things, the specific market and the extent to which an online subscriber also maintains a print subscription.
Exceptional content driven by award-winning journalism and columnists
With an average publishing history of over 150 years, we believe each of our eight principal daily newspapers is integral to the cultural fabric of its community, a trusted source of local and national news and information, and an influential and prominent local voice. Our publications are home to a talented pool of editors, reporters, writers, photographers, producers and designers, and our award-winning journalists are responsible for one of the most comprehensive collections of daily editorial content in the country, covering investigative reporting, breaking news, feature writing, design, photography, editorial, real estate, business, sports, and religion, among other topics. In recognition of their journalistic excellence, our publications have amassed 88 Pulitzer Prizes, including 27 since the year 2000, and many other prestigious editorial accolades.
Long-standing advertising relationships
Over the last several years, we have worked to upgrade sales team talent and realign incentives while investing in research, data and analytics to create a highly-skilled, motivated and effective sales organization. We provide advertisers the opportunity to reach millions of consumers in several key markets through the use of targeted media. We serve a diverse group of national advertisers with no individual advertiser accounting for more than 1.2% of our advertising revenue in 2013. We have longstanding relationships with many of our customers and our sales organization has frequent, direct contact with key decision-makers within these organizations.
 
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Efficient content sharing across the Tribune Publishing portfolio
Our editorial platform allows for sharing of content throughout the organization. We have created Media On Demand (“MoD”), a content-sharing program to enable fast, efficient use of content created by the Los Angeles Times , the Chicago Tribune and other sources. The MoD team creates and edits shared stories, photo galleries, videos, content collections and landing pages for non-local content. This editorial platform produces a vast repository of local, regional, national and international content. We further capitalize on our editorial resources by leveraging the foreign and national bureaus of the Los Angeles Times to provide award-winning coverage of national and international affairs throughout our daily newspaper portfolio. Similarly, correspondents in the Washington, D.C. bureau support each of our daily newspapers with political, governmental and policy coverage.
MoD is also our content and technical liaison with vendors such as Reuters, Getty Images, The Sports Network and News Distribution Network. MoD offerings are broad and include world, national, business, politics, food, movies, celebrities, trivia, notable deaths, special events and other editorial topics. MoD supplies this content in fully edited and paginated “modules” for insertion into both print and digital media. In this way, print and digital content is generated once and used multiple times across our smaller news organizations.
Robust print and distribution infrastructure with significant third-party relationships
We maintain an extensive network of printing plants and insertion facilities that is utilized to produce and disseminate our publications as well as pursue commercial services revenue from third parties. Annually, we deliver more than one billion copies of over 150 different publications and 10 billion preprints. In addition to our own publications, we print approximately 20 third-party publications in select markets, including The Wall Street Journal , The New York Times and USA Today , and distribute approximately 120 third-party publications. In recent years, we have executed a number of strategic initiatives designed to optimize capacity utilization of our facilities in order to pursue additional commercial printing and distribution opportunities.
Efficient cost structure and centralized support functions
Over the past three years, we have rationalized our organizational structure and expense base to drive increased profitability. We believe we have successfully leveraged our economies of scale to reduce supply chain costs, consolidate shared services, provide significant shared editorial content, replicate best practices and streamline management. We believe the consolidation over time of certain operational functions and services has resulted in cost savings, standardization of procedural best practices and enhanced operational performance.
Leadership in Hispanic and niche demographics
With the growing demographic significance of Hispanic communities in the United States, especially in a number of our key markets, we are well positioned to reach these communities. With media groups in Los Angeles, Chicago and South Florida, we have direct access to three of the six largest Hispanic DMAs in the United States. In Chicago and Los Angeles, the Spanish-language Hoy newspaper, along with its Fin de Semana weekend edition and digital offerings, provides the Hispanic perspective on everything from front-page news to entertainment and sports. We are also exploring a variety of strategic initiatives designed to raise our profile in Hispanic communities.
The continued expansion of niche magazines and websites such as Chicago Magazine , Hartford Magazine and the Florida Media Group’s City & Shore also offers a compelling opportunity to reach new sources of local advertising.
Strategies
We are committed to the creation and monetization of content of the highest quality and integrity, in both print and digital formats and in response to the evolving preferences of both consumers and advertisers. Our
 
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goal is to produce improved earnings and cash flow, creating incremental value for shareholders over the long-term. We intend to achieve these objectives by executing the following strategies:
Strengthen franchises by continuously improving digital platforms
We are focused on growing our digital media platform by targeting on new consumer opportunities. In addition to the branded websites of our newspapers, we are developing new products and services to improve the online and mobile experience for digital readers and enhance compelling online, interactive advertising and marketing communication opportunities for customers. For example, in 2014, to deliver the best product to our customers, we expect to implement Next Generation User Experience (“NGUX”) websites across all Tribune Publishing properties. Since its launch in May 2014, the NGUX at latimes.com has demonstrated positive results, including a 66% increase in pages viewed per visit. With more than 42 million monthly unique visitors, digital advertising revenue accounted for approximately 18% of total advertising revenue in fiscal 2013.
We strive to ensure that our digital capabilities are well-coordinated across our media properties in particular areas such as advertising operations, ad network utilization and user engagement. Our digital efforts have resulted in more than 60 newspaper-affiliated websites or independently-branded online destinations and related mobile applications that collectively reach more than 42 million monthly unique visitors, giving us the largest online reach among local newspaper publishers, and the fourth-largest online reach among all newspaper publishers. We plan to leverage our strong local presence and innovative online and mobile offerings to successfully monetize our digital subscriber base and drive robust digital advertising growth.
Monetize content through digital paywalls and subscription pricing strategies
Since 2011, we have implemented “paywalls” on our newspaper-affiliated websites. Daily digital circulation (replica and non-replica combined) grew by approximately 51% for the six months ended March 30, 2014, which is the most recently audited circulation period, versus the prior year period while Sunday digital circulation grew by approximately 45% over the same time period. Implementation of a paywall strategy, product development and monetization of our digital audience has enabled us to realize $8.3 million of revenue from digital subscriptions in 2013, a category in which we had no meaningful revenue in 2011.
In addition, we have implemented targeted price increases which helped grow print circulation revenue by approximately 2% in 2013 (compared on a 52-week basis) despite a decline in the number of newspapers circulated.
Create an integrated, next-generation marketing and advertising sales effort
We aim to continuously upgrade sales team talent, realign incentives and invest in research, data and analytics to create a highly-skilled, motivated and effective sales organization. We seek to achieve accountability and transparency throughout the sales organization and motivate the team while creating opportunities to monetize content.
Through Tribune365 , we have built a national, cross-platform sales team, offering advertisers customized, multi-market solutions across all of our media platforms, including print, online, mobile and events. This experienced team of 49 employees can customize an advertising campaign across our portfolio to create a highly effective program that reaches a targeted audience across multiple local markets in which we have leading positions. Additionally, through our proprietary solutions, such as 435 Digital , and third-party technologies, we offer a full line of digital marketing services products that advertisers can use to reach and interact with local consumers.
 
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Supplement organic growth with selective acquisitions
We believe the operational transformation we have undertaken positions us as a flexible and scalable platform for strategic acquisitions and enables us to more efficiently and profitably grow and diversify our revenue streams. We believe our centralization efforts put us in an ideal position to explore strategic acquisitions to enhance our business, including in areas where we can expand our audience, broaden our relationships with customers and readers and offer new products. We will also continue to explore opportunities for additional consolidation with a focus on in-market adjacencies to leverage our existing scale, such as our recent acquisitions of publications in the Baltimore area.
Continue to strategically manage our core business
In recent years, we have grown circulation revenue in the face of industry declines in volume by implementing successful circulation pricing tactics. We expect to continue to win loyal customers through strategically bundling print and digital offerings and to incentivize print customers to activate digital accounts. We have also implemented aggressive “win-back” programs to reconnect with print readers and are working to activate print subscribers as digital customers, including with digital-only subscription programs.
In addition, we have rationalized our cost structure in order to drive increased profitability. We have leveraged our economies of scale to reduce supply chain costs, consolidate shared services, provide significant shared editorial content, replicate best practices and streamline management. At the same time, management has continued to invest in infrastructure, technology, business intelligence and content development to support the ongoing digital transformation. We expect to continue these efforts in order to continue to decrease costs and drive profitability.
In November 2013, we announced a restructuring further consolidating non-editorial publishing functions such as national sales and marketing and circulation marketing around single departments to streamline business activities resulting in further reducing overall costs. We expect this unified and focused organizational structure to streamline decision-making and align company-wide strategy across most major activities.
Maintain a flexible balance sheet
Following the distribution, we expect to have approximately $350 million of indebtedness outstanding under our expected Senior Term Loan Facility, in addition to our expected Senior ABL Facility with aggregate maximum commitments (subject to availability under a borrowing base) of approximately $140 million and an arrangement for a cash backed letter of credit of approximately $25 million to be issued on our behalf. Through proactive cost management, prudent capital expenditures and conservative financial policies, we will seek to maintain financial flexibility to successfully execute our business strategies.
Customers and Contracts
CareerBuilder
An affiliate of Tribune is currently party to an affiliation agreement (the “Affiliation Agreement”) with CareerBuilder, which owns and operates CareerBuilder.com, pursuant to which our newspapers earn advertising revenues and pay affiliate fees. Following the distribution, we expect Tribune to enter into a modified affiliation agreement that would apply to our newspapers for up to five years. While this modified affiliation agreement would not be as favorable to the newspapers as the Affiliation Agreement, it is preferable for us to obtain this modified affiliation agreement rather than operate without any affiliation agreement with CareerBuilder. If Tribune (together with its affiliates) were to cease to own at least a 1% voting and economic interest in Tribune Publishing prior to the end of the five-year period, CareerBuilder could elect to terminate the modified affiliation agreement, see “Risk Factors—Risks Relating to the Distribution—A portion of our advertising revenues is earned under affiliation agreements which may be terminated or amended to provide for less favorable terms following the distribution.”
 
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Classified Ventures
Each of our newspapers is currently party to an affiliation agreement with Classified Ventures pursuant to which our newspapers earn advertising revenues and pay affiliate fees. The affiliation agreements are subject to annual renewal. There can be no assurance that our newspapers will be able to enter into annual renewals of these affiliation agreements on similar terms, or at all, following the distribution, see “Risk Factors—Risks Relating to the Distribution—A portion of our advertising revenues is earned under affiliation agreements which may be terminated or amended to provide for less favorable terms following the distribution.”
Contracted Newsprint Printing and Distribution Agreements
We contract with a number of national and local newspapers to both print and distribute their respective publications in local markets where we are a newspaper publisher. In some instances where we print publications, we also manage and procure newsprint, ink and plates on their behalf. These agreements allow us to leverage our investment in infrastructure in those markets to support our own publications. As a result, those agreements tend to contribute significant incremental profitability relative to the underlying revenues. We currently distribute national newspapers (including USA Today , The New York Times , and The Wall Street Journal ) in our local markets under multiple agreements. Additionally, both in Los Angeles and Chicago we provide some or all of these services to other local publications. One of the local publications provided notice to us to terminate its printing and distribution agreements with us in May 2015 and May 2016, respectively. A decision by any of the three largest national publications or the major local publications to cease publishing and distribution in those markets, or seek alternatives to their current business practice of partnering with us, could materially impact our profitability.
Competition
Each of our eight principal daily newspapers holds a leading market position in their respective DMA and competes for readership and advertising with both local or community newspapers as well as national newspapers and other traditional and web-based media sources. We face competition for both advertising dollars and consumers’ dollars and attention.
The competition for advertising dollars comes from local, regional, and national newspapers, the Internet, magazines, broadcast, cable and satellite television, radio, direct mail, yellow pages, and other media as advertisers adjust their spending based on the perceived value of the audience reached and the cost to reach that audience.
The secular shift impacting how content is consumed has led to increased competition from a wide variety of new digital content offerings, many of which are often free to users. Besides price, variables impacting customer acquisition and retention include the quality and nature of the user experience and the quality of the content offered.
Regulatory
The FCC’s “Newspaper Broadcast Cross Ownership Rule” (the “NBCO Rule”) prohibits a person or entity from having an “attributable” ownership or positional interest in a broadcast station and a daily newspaper published in the same market. For purposes of the NBCO Rule, any common officer, director, or 5% or greater voting stockholder of Tribune and Tribune Publishing (“Common Interest Holder”) will be deemed to hold an attributable interest in both companies after the distribution. The existence of a Common Interest Holder may have the effect of limiting the activities or strategic business opportunities available to one company as a result of the business or activities of the other. Tribune’s existing Chicago market radio/television/newspaper combination has been permanently grandfathered by the FCC, and its television/newspaper combinations in the New York, Los Angeles, Miami-Fort Lauderdale and Hartford-New Haven markets are subject to temporary waivers of the
 
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NBCO Rule granted on November 16, 2012, in connection with the FCC’s approval of Tribune’s plan of reorganization (the “Exit Order”). The temporary waivers require Tribune to come into compliance with the NBCO rule within one year from the release date of the Exit Order or, if the FCC adopts a revised NBCO rule before the one-year deadline, authorizes Tribune to seek waivers of the revised rule by filing new waiver requests within 60 days after the FCC releases the order revising the NBCO rule. Because the FCC had not adopted a revised NBCO Rule by November 12, 2013, on that date Tribune filed with the FCC a request for extension of the temporary NBCO rule waivers granted in the Exit Order (in New York, Los Angeles, Miami-Fort Lauderdale and Hartford-New Haven). The request is pending. On March 31, 2014, the FCC initiated its Congressionally-mandated 2014 Quadrennial Review proceeding, in which it is requesting comment on whether its media ownership rules, including the NBCO Rule, are necessary in the public interest as a result of competition. The FCC has indicated it does not intend to act on the 2014 Quadrennial Review before June 30, 2016 at the earliest. We cannot predict the outcome of this proceeding or whether or the extent to which the FCC will reauthorize Tribune’s existing temporary waivers.
Employees
As of March 30, 2014, we had approximately 7,475 full-time and part-time employees, including approximately 925 employees represented by various employee unions. We believe our relations with our employees are satisfactory.
Intellectual Property
Currently we do not face major barriers to our operations from patents owned by third parties. However, because we operate a large number of websites and mobile applications in high-visibility markets, we do defend patent litigation, from time to time, brought primarily by non-practicing entities, as opposed to marketplace competitors. We have sought patent protection in certain instances; however, we do not consider patents to be material to our business as a whole. Of greater importance to our overall business are the federal, international and state trademark registrations and applications that protect, along with our common law rights, our brands, certain of which are long-standing and well known, such as Los Angeles Times , Chicago Tribune and Hartford Courant . Generally, the duration of a trademark registration is perpetual, if it is renewed on a timely basis and continues to be used properly as a trademark. We also own a large number of copyrights, none of which individually is material to the business. We maintain certain licensing and content sharing relationships with third-party content providers that allow us to produce the particular content mix we provide to our customers in our markets. Other than the foregoing and commercially available software licenses, we do not believe that any of our licenses to third-party intellectual property are material to our business as a whole.
In connection with the distribution, we expect to enter into a number of agreements with Tribune that will govern our relationship with Tribune related to certain intellectual property and other proprietary information we will have the right to use, under specified conditions, in the operation of our business following the distribution. The Intellectual Property License Agreement is expected to provide non-exclusive and royalty-free licenses to intellectual property (other than patents or trademarks) currently owned by either Tribune or Tribune Publishing and used by the other, such as internally developed software and know-how. The Trademark License Agreement is expected to provide a non-exclusive, royalty-free license from Tribune to Tribune Publishing to use certain trademarks, service marks and trade names, including the Tribune name. The Content Sharing Agreement is expected to provide royalty-free licenses to certain news and other content in a variety of media from Tribune to Tribune Publishing and from Tribune Publishing to Tribune. In addition, there may be other licenses from us to Tribune that we would not expect to be material to our business following the distribution.
Properties
Our corporate headquarters are located at 435 North Michigan Avenue, Chicago, Illinois. Our facilities occupy approximately 7.1 million square feet in the aggregate of which approximately 2.6 million square feet is
 
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leased from third parties and approximately 4.5 million square feet is leased from subsidiaries of Tribune Real Estate Holdings, LLC pursuant to lease agreements containing arm’s-length terms, which were determined based on the recommendations of an independent licensed real estate appraiser. See “Relationships Between Tribune and Tribune Publishing Following the Distribution—Real Estate Matters.” Tribune Real Estate Holdings, LLC will remain a subsidiary of Tribune Company immediately following the Distribution. See “Relationships Between Tribune and Tribune Publishing Following the Distribution.”
We currently have newspaper production facilities in California, Connecticut, Florida, Illinois, Maryland and Pennsylvania. Each of these facilities is leased from a subsidiary of Tribune Real Estate Holdings, LLC; however, we own substantially all of the production equipment. There are 15 net leases for Tribune Publishing’s industrial facilities which include printing plants, distribution facilities and related office space. For printing plants the initial lease term is 10 years with two options to renew for additional 10 year terms. For distribution facilities, the initial lease term is 5 years with either two options to renew for additional 5 year terms or two options to renew for additional 10 year terms.
The leases for Tribune Tower in Chicago and Los Angeles Times Square, both of which are large multi-tenant buildings, are gross leases which provide for professional management of the building. At Tribune Tower, Tribune Publishing leases approximately 306,000 square feet, while at Los Angeles Times Square, Tribune Publishing leases approximately 242,000 square feet. The gross leases provide for an initial term of 5 years with renewal options for up to two additional 5 year terms.
Many of our local media organizations have outside news bureaus, sales offices and distribution centers which generally are leased from third parties.
We believe that our current facilities, including the terms and conditions of the relevant lease agreements, are adequate to operate our businesses as currently conducted.
Raw Materials
As a publisher of newspapers, we utilize substantial quantities of various types of paper. During fiscal year 2013, we consumed approximately 229 thousand metric tons of newsprint. We currently obtain the majority of our newsprint from six North American suppliers, primarily under long-term contracts. Substantially all of our paper purchasing is done on a regional, volume purchase basis, and draws upon Canadian and U.S. based suppliers. We believe that our current sources of paper supply are adequate.
Our earnings are sensitive to changes in newsprint prices. Newsprint and ink expense accounted for 10.0% of total operating expenses in fiscal year 2013. We estimate that we will use approximately 205 metric tons of newsprint in fiscal 2014, depending on the level of print advertising, circulation volumes and other business considerations.
In fiscal year 2013, 60% of the newsprint used by our newspapers was made with recycled fiber and the average recycled fiber content was 33%. In addition, all of our newspapers collect and recycle press waste, newspaper returns and printing plates.
Seasonality
Our results of operations, when examined on a quarterly basis, reflect the seasonality of our revenues. Second and fourth quarter advertising revenues are typically higher than first and third quarter revenues. Results for the second quarter reflect spring advertising revenues, while the fourth quarter includes advertising revenues related to the holiday season. Revenues from circulation and commercial printing operations, however, are significantly less seasonal than advertising revenues and help to moderate the overall seasonality of the business.
 
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Legal Proceedings
We are subject to various legal proceedings and claims that have arisen in the ordinary course of business. The legal entities comprising our operations are defendants from time to time in actions for matters arising out of their business operations. In addition, the legal entities comprising our operations are involved from time to time as parties in various regulatory, environmental and other proceedings with governmental authorities and administrative agencies.
On Dec. 31, 2012, Tribune and 110 of its direct and indirect wholly-owned subsidiaries (collectively, the “Debtors”) that had filed voluntary petitions for relief under Chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) on Dec. 8, 2008 (or on Oct. 12, 2009, in the case of Tribune CNLBC, LLC) emerged from Chapter 11. Certain of the legal entities included in the combined financial statements of Tribune Publishing were Debtors or, as a result of the restructuring transactions undertaken at the time of the Debtors’ emergence, are successor legal entities to legal entities that were Debtors. The Debtors’ Chapter 11 cases have not yet been closed by the Bankruptcy Court, and certain claims asserted against the Debtors in the Chapter 11 cases remain unresolved. As a result, we expect to continue to incur certain expenses pertaining to the Chapter 11 proceedings in future periods, which may be material. See Notes 2 and 3 to the audited combined financial statements for further information.
We do not believe that any matters or proceedings presently pending will have a material adverse effect, individually or in the aggregate, on our combined financial position, results of operations or liquidity. However, legal matters and proceedings are inherently unpredictable and subject to significant uncertainties, some of which are beyond our control. As such, there can be no assurance that the final outcome of these matters and proceedings will not materially and adversely affect our combined financial position, results of operations or liquidity.
 
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 MANAGEMENT
Directors and Executive Officers
The following table sets forth information regarding our executive officers and directors as of the date hereof, as well as those who we expect will be our executive officers and directors as of the distribution. The individuals who will be our executive officers following the separation may or may not currently be employees of Tribune or its subsidiaries (including Tribune Publishing). After the separation from Tribune, none of our executive officers will be employees of Tribune. Upon the completion of the distribution, we expect to have a Board of Directors initially consisting of six directors and that our Board of Directors will comply with the requirements set forth in the listing rules of the New York Stock Exchange, including applicable independence requirements (subject to applicable phase in provisions). We expect that the Board of Directors will appoint a seventh director shortly after the distribution.

Name	  	Age          	  	Principal Positions and Directorships	
Steven Berns	  	49	  	President (Interim) and Chief Executive Officer (Interim)	
John H. Griffin, Jr.	  	53	  	President, Chief Executive Officer and Director	
John B. Bode	  	39	  	Chief Financial Officer	
Howard Greenberg	  	64	  	Publisher and Chief Executive Officer, Orlando Sentinel and Sun-Sentinel	
Tony Hunter	  	53	  	Publisher and Chief Executive Officer, Chicago Tribune Company	
Timothy E. Ryan	  	55	  	Publisher and Chief Executive Officer, The Baltimore Sun and The Morning Call	
Julie K. Xanders	  	49	  	General Counsel	
Eddy W. Hartenstein	  	63	  	Non-Executive Chairman of the Board of Directors	
David E. Dibble	  	54	  	Director	
Philip G. Franklin	  	62	  	Director	
Renetta McCann	  	57	  	Director	
Ellen Taus	  	55	  	Director	
We expect that as of the date of the distribution, Steven Berns will no longer be a director, executive officer or employee of Tribune Publishing; however, Steven Berns intends to continue as the Executive Vice President and Chief Financial Officer of Tribune.
Biographies of Executive Officers and Directors
John H. Griffin, Jr. Mr. Griffin will serve as Chief Executive Officer of Tribune Publishing and a director as of the distribution. Prior to joining Tribune Publishing, Mr. Griffin served as co-founder and chief executive officer of Empirical Media Advisors, LLC, a consulting firm advising national media properties, including Tribune Publishing, from May 2012. From September, 2010 until February 2011, Mr. Griffin was Chief Executive Officer of Time Inc., as well as the Chairman of MPA, the trade association for the consumer magazine industry, where he had been on the board for seven years. Mr. Griffin has also served as Chairman of the American Advertising Federation and as a Director of the Interactive Advertising Bureau and the Audit Bureau of Circulations. He was a Founding Director of Next Issue Media, a groundbreaking digital newsstand formed by a consortium of five leading publishers. Before joining Time Inc., Mr. Griffin spent a dozen years at Meredith Corporation. As President of its National Media Group, Mr. Griffin led the successful transformation of Meredith into a digitally enabled, diversified media and marketing company. From its print roots, Meredith became a major provider of marketing services through Meredith Integrated Marketing, of which Mr. Griffin was the founding General Manager in 1996. From 1999 to 2003, Mr. Griffin worked at the Parade Division of Advance Publications, where he was President and Publisher of Parade Magazine. Prior to that, he was Vice President of Marketing for the Meredith Television Broadcasting Group. Mr. Griffin also spent four years at the Magazine Group of The New York Times Company before joining Meredith in 1994. Mr. Griffin graduated from the Yale School of Management and Boston College. He is currently a Director of the Yale Center for Customer Insights. He is also on the Business Advisory Board of Propublica, the investigative news organization.
 
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Specific qualifications, experience, skills and expertise include:
 
 	—  	 	Operating and management experience;	
 
 	—  	 	Core business skills, including financial and strategic planning; and	
 
 	—  	 	Deep understanding of the publishing industry.	
John B. Bode. Mr. Bode was named our Chief Financial Officer in September 2013. Prior to that, Mr. Bode spent 11 years at Source Interlink Companies, Inc. From January 2011 to September 2013, Mr. Bode served as Executive Vice President and Chief Financial Officer at Source Interlink, where he oversaw the company’s financial reporting, risk management, tax compliance and treasury functions, as well as all financial operation groups. Prior to being named Chief Financial Officer, Mr. Bode held a variety of senior level corporate finance and operating roles with Source Interlink and its operating subsidiaries since joining Source Interlink as its Corporate Controller. Responsibilities included overall corporate strategy including overseeing all merger and acquisition activity and financing activities as well as financial operations and reporting. Prior to joining Source Interlink, Mr. Bode was an audit manager at BDO Seidman, LLP. Mr. Bode holds a B.A. from Notre Dame.
Howard Greenberg. Mr. Greenberg will serve as Publisher and Chief Executive Officer of the Orlando Sentinel and Sun-Sentinel as of the distribution. Mr. Greenberg has served as President and CEO of the Sun-Sentinel Company and Publisher of Sun-Sentinel since May 2007 and President and CEO of Orlando Sentinel Communications Company and Publisher of the Orlando Sentinel since February 2008. He was also named General Manager overseeing WSFL-TV in March 2008. Previously, Mr. Greenberg served as senior vice president and general manager of Sun-Sentinel Company from 2005 to 2007, overseeing the advertising, circulation, finance and planning, human resources, marketing, operations and technology divisions and niche publications. Prior to that, Mr. Greenberg served as senior vice president/managing director in 2004 and vice president/circulation and operations in 2003. Since 1984, he has also served as circulation sales marketing manager, vice president and director of development, as well as serving two stints as vice president and circulation director. Before joining Sun-Sentinel Company, Mr. Greenberg served as circulation director for the Denver Post and held several key circulation and operations positions with the Miami Herald . He also spent a year as vice president of circulation for the New York Daily News . Mr. Greenberg has a degree in finance from the University of Miami and has attended advanced management programs at both Duke and Cornell Universities.
Tony Hunter. Mr. Hunter will serve as Publisher and Chief Executive Officer of the Chicago Tribune Company as of the distribution. Mr. Hunter has served in such role and as CEO of Tribune’s publishing operation since July 2011, where he was responsible for the strategic priorities and day-to-day digital and print operations of seven Tribune newspapers, including T he Baltimore Sun , Daily Press , The Morning Call , Orlando Sentinel and Sun-Sentinel . Mr. Hunter previously served as one of the four members of Tribune Company’s Executive Council, which exercised the responsibilities of the office of Chief Executive and President from October 2010 to May 2011. Since September 2008, Mr. Hunter has served as publisher and CEO of Chicago Tribune Company, overseeing a robust print and digital media portfolio including the Chicago Tribune, RedEye, Hoy, chicagotribune.com, TribLocal, and Chicago Magazine. Mr. Hunter previously was senior vice president/circulation and operations for Chicago Tribune, a position he assumed in 2007. In this capacity, he was responsible for production, technology and circulation, as well as marketing strategy, customer acquisition/retention, manufacturing and distribution. Mr. Hunter joined Chicago Tribune in 1994 as manager/circulation planning and analysis. Prior to joining Chicago Tribune, Mr. Hunter worked for the Audit Bureau of Circulations (ABC) as Director of Field Auditing-Newspapers and held a variety of auditing positions from 1984 to 1994. Mr. Hunter holds an MBA in leadership and organizational development from DePaul University and a BA in accounting, business administration and economics from Coe College in Cedar Rapids, Iowa.
 
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Timothy E. Ryan. Mr. Ryan will serve as Publisher and Chief Executive Officer of T he Baltimore Sun and Morning Call as of the distribution. Mr. Ryan has served as publisher, president and chief executive officer of the Baltimore Sun Media Group since 2007. In 2010, he also became publisher and CEO for additional Tribune media properties, The Morning Call and mcall.com. In Baltimore, Mr. Ryan oversees not only The Baltimore Sun but also 30 community newspapers and magazines and the region’s leading website, baltimoresun.com. Mr. Ryan came to The Baltimore Sun after having served as vice president of circulation and consumer marketing since 2005 at The Chicago Tribune , where he was responsible for sales, marketing and distribution throughout Chicago and the Midwest. Prior to joining The Chicago Tribune , Mr. Ryan served as vice president of circulation and operations at The Baltimore Sun from July 2000 to February 2005. Mr. Ryan also worked as vice president of circulation at The Philadelphia Inquirer from 1993 to 2000. Mr. Ryan holds a bachelor’s degree in political science from the University of Notre Dame and a master’s degree in business administration from J.L. Kellogg Graduate School of Management, Northwestern University.
Julie K. Xanders. Ms. Xanders will serve as General Counsel of Tribune Publishing as of the distribution. Ms. Xanders previously served as the Assistant General Counsel/West Coast Media of Tribune and served as Senior Vice President, Legal for the Los Angeles Times . Ms. Xanders joined The Times Mirror Company in 1993 as Corporate Counsel for Times Mirror Cable Television, Inc. and was promoted to Assistant General Counsel in 1995 for Times Mirror, Associate General Counsel in 1997, Deputy General Counsel in 1998, and Senior Vice President and General Counsel for the Los Angeles Times in August 1998. Prior to joining Times Mirror, Ms. Xanders worked for four years in private practice with Gibson, Dunn & Crutcher as an associate attorney. Ms. Xanders earned a doctor of jurisprudence from Boalt Hall School of Law (UC Berkeley) and has a bachelor’s degree in economics and political science from Yale University, where she graduated summa cum laude and was elected Phi Beta Kappa. She is a past chair and continues to serve as a member of the Executive Committee of the Corporate Law Departments Section of the Los Angeles County Bar Association. She served on the Board of Trustees and several Board committees of the Los Angeles County Bar Association from July 2004 to June 2009 and from July 2010 to June 2011. She serves as Vice Chair of the Board of Trustees of the Southwestern University School of Law and is chair of the Membership Committee. She serves on the Board of Directors of the California Newspaper Publishers Association and is Chair of its Governmental Affairs Committee. She was a member of the Board of Directors of the Los Angeles Area Chamber of Commerce from January 2002 to June 2005.
Eddy W. Hartenstein. Mr. Hartenstein has agreed to be Non-Executive Chairman of the Board of Directors as of the distribution. Mr. Hartenstein served as Publisher and Chief Executive Officer of the Los Angeles Times since August 2008, where he was responsible for all aspects of print, digital and mobile operations of the country’s largest metropolitan daily news organization, as well as those of the Los Angeles Times Media Group’s portfolio. Prior to Tribune Company’s January 2013 change of ownership, he was also President and Chief Executive Officer of Tribune Company, one of the country’s leading multimedia companies, operating businesses in publishing, digital and broadcasting. He remains a member of the Board of Tribune Company and special advisor to the CEO. Previously, Hartenstein presided over the birth and growth of the satellite television industry. As a Vice President of Hughes Communications in 1981, he expanded Hughes’s acquisition and deployment of commercial communications satellites which served the broadcast and cable programming industries. In 1990, he was named President of a Hughes-owned subsidiary founded to develop direct-to-home satellite TV service. Mr. Hartenstein then transformed the concept into one of the most successful new product launches in consumer electronics history, propelling what became known as DirecTV into the nation’s leading digital, multichannel television service and helping establish digital TV as an innovative entertainment and distribution medium. He served as DirecTV’s Chairman and CEO through 2004, when the company was sold to News Corp. Currently, Mr. Hartenstein is a board member at Broadcom Corporation, City of Hope, SanDisk and Sirius XM Radio, where he also serves as lead independent director. In 2008, he was inducted into the Consumer Electronics Association Hall of Fame and in 2007 he received an Emmy ® from the National Academy of Television Arts and Sciences for Lifetime Achievement. He was inducted into the Broadcasting & Cable Hall of Fame in 2002 and the National Academy of Engineering (NAE) in 2001. Mr. Hartenstein holds Bachelor of Science degrees in aerospace engineering and mathematics from California State Polytechnic University, Pomona and a Master of Science degree from Cal Tech.
 
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Specific qualifications, experience, skills and expertise include:
 
 	—  	 	Operating and management experience;	
 
 	—  	 	Core business skills, including financial and strategic planning; and	
 
 	—  	 	Deep understanding of our company, its history and culture.	
David E. Dibble. Mr. Dibble has agreed to serve as a director of Tribune Publishing as of the distribution. Mr. Dibble was Executive Vice President, Central Technology at Yahoo!, Inc. from November 2008 to December 2013, where he held a variety of executive technology positions, including development of the company’s data centers and global technology infrastructure. From 2005 to 2007, Mr. Dibble served as Chief Technology Officer and Executive Vice President at First Data Corporation, a global electronic payment processing company. Prior to that, he had served in various senior technology roles at JPMorgan Chase & Co., Charles Schwab & Co. and Fidelity Investments. Mr. Dibble is a graduate of the University of Kansas, where he earned his B.S. in economics and undertook three years of graduate studies in economics, mathematics, and computer science. Mr. Dibble currently serves as a director of Hubub, Inc.
Specific qualifications, experience, skills and expertise include:
 
 	—  	 	Operating and management experience;	
 
 	—  	 	Core business skills, including operations and strategic planning; and	
 
 	—  	 	Deep understanding of the technology industry.	
Philip G. Franklin. Mr. Franklin has agreed to serve as a director of Tribune Publishing as of the distribution. Mr. Franklin is currently the Senior Vice President and Chief Financial Officer of Littelfuse, Inc., a manufacturer of electronic components. Prior to joining Littelfuse in 1998, he was Vice President and Chief Financial Officer of OmniQuip International, a private equity sponsored roll-up in the construction equipment industry. Previously, Mr. Franklin served as Chief Financial Officer for Monarch Marking Systems, a subsidiary of Pitney Bowes, and Hill Refrigeration. Earlier in his career, he worked in a variety of finance and general management positions at FMC Corporation. Mr. Franklin also currently serves as a director of TTM Technologies, Inc., where he is chairman of the audit committee. Mr. Franklin attended Dartmouth College, where he earned a bachelor’s degree in economics and an MBA at the Tuck School of Business.
Specific qualifications, experience, skills and expertise include:
 
 	—  	 	Operating and management experience;	
 
 	—  	 	Core business skills, including financial and strategic planning; and	
 
 	—  	 	Expertise in finance and financial reporting.	
Renetta McCann. Ms. McCann has agreed to serve as a director of Tribune Publishing as of the distribution. Ms. McCann is currently Chief Talent Officer at the advertising agency Leo Burnett Company, where she has led the People & Culture department and overseen the agency’s U.S. recruitment, training, benefits and talent management since September 2012. Prior to that, Ms. McCann was a contract consultant at BPI, a human capital consulting firm, from January 2012 to September 2012. Earlier in her career, Ms. McCann held various influential positions over two decades at Leo Burnett, including as CEO of Starcom MediaVest Group Worldwide and Chief Talent Officer of VivaKi. Ms. McCann attended Northwestern University, where she earned a B.S. in speech and a Masters of Science in learning and organizational change.
 
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Specific qualifications, experience, skills and expertise include:
 
 	—  	 	Operating and management experience;	
 
 	—  	 	Core business skills, including human resources management and strategic planning; and	
 
 	—  	 	Deep understanding of the media industry.	
Ellen Taus. Ms. Taus has agreed to serve as a director of Tribune Publishing as of the distribution. Ms. Taus is the Chief Financial Officer and Treasurer of The Rockefeller Foundation, where she oversees the foundation’s audit, tax, budgeting, insurance and cash management functions since 2008. Prior to that, Ms. Taus served as the Chief Financial Officer of Oxford University Press USA, where she oversaw the organization’s U.S. business operations. From 1999 to 2003, Ms. Taus served as Chief Financial Officer for the Electronic Publishing Division of The New York Times Company after having been the company’s Vice President and Treasurer for three years. Earlier in her career, she worked in corporate finance for RH Macy and was the Chief Financial Officer for the American Museum of the Moving Image. A graduate of Northwestern University with a B.A. in Economics, Ms. Taus holds an M.B.A. in Finance and Marketing from Columbia University. She currently serves on the Stewardship Committee of the Audubon Society of New York and is Treasurer and a member of the Board of Directors of Common Ground, a New York-based housing and homelessness prevention organization, and of Comprehensive Development Inc., a New York City education organization.
Specific qualifications, experience, skills and expertise include:
 
 	—  	 	Expertise in finance and financial reporting;	
 
 	—  	 	Core business skills, including financial, audit and strategic planning; and	
 
 	—  	 	Deep understanding of the publishing industry.	
 
Corporate Governance
Board Composition and Director Independence
We expect that, upon completion of the distribution, our amended and restated certificate of incorporation will provide that directors are appointed and hold office for one-year terms, to hold office until the next annual general meeting of our stockholders or until removed from office in accordance with our amended and restated by-laws. Under our amended and restated by-laws, our Board of Directors will consist of such number of directors as may be determined from time to time by resolution of the Board of Directors, but in no event may the number of directors be less than one. Any vacancies or newly created directorships may be filled only by the affirmative vote of a majority of our directors then in office, even if less than a quorum, or by a sole remaining director. Each director will hold office until his or her successor has been duly elected and qualified or until his or her earlier death, resignation or removal. See “Description of Capital Stock—Anti-Takeover Effects of Various Provisions of Delaware Law, Our Amended and Restated Certificate of Incorporation and Amended and Restated By-Laws—Size of Board and Vacancies; Removal.”
All directors following completion of the distribution, other than Mr. Griffin and Mr. Hartenstein, are expected to meet the New York Stock Exchange listing standards for independence.
Committees of Our Board of Directors
Effective upon the completion of the distribution, our Board of Directors will have the following committees, each of which will operate under a written charter that will be available on our website prior to the distribution.
 
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Audit Committee
The Audit Committee, which following the distribution will consist of Mr. Franklin (Chair), Mr. Dibble and Ms. Taus, has the responsibility for, among other things, assisting the Board of Directors in reviewing our financial reporting and other internal control processes, our financial statements, the independent auditors’ qualifications and independence, the performance of our internal audit function and independent auditors and our compliance with legal and regulatory requirements and our code of business conduct and ethics. The charter of our Audit Committee will be available without charge on the investor relations portion of our website upon completion of the distribution.
Mr. Franklin is expected to be identified as an “audit committee financial expert” as that term is defined in the rules and regulations of the SEC.
Compensation Committee
The Compensation Committee, which following the distribution will consist of Ms. Taus (Chair), Mr. Dibble and Ms. McCann, has the responsibility for reviewing and approving the compensation and benefits of our employees, directors and consultants, administering our employee benefits plans, authorizing and ratifying stock option grants and other incentive arrangements and authorizing employment and related agreements. The charter of our Compensation Committee will be available without charge on the investor relations portion of our website upon completion of the distribution.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee, which following the distribution will consist of Ms. McCann (Chair) and Mr. Franklin, has the responsibility, among its other duties and responsibilities, for identifying and recommending candidates to the board of directors for election to our Board of Directors, reviewing the composition of the Board of Directors and its committees, developing and recommending to the Board of Directors corporate governance guidelines that are applicable to us, and overseeing board of directors evaluations. The charter of our Nominating and Corporate Governance Committee will be available without charge on the investor relations portion of our website upon completion of the distribution.
Corporate Governance Guidelines and Code of Business Conduct and Ethics
Prior to the completion of the distribution, our Board of Directors will adopt Corporate Governance Guidelines and a Code of Business Conduct and Ethics for directors, officers, and employees. The Corporate Governance Guidelines will set forth our policies and procedures relating to corporate governance effective as of the completion of the distribution and will comply with the requirements of the New York Stock Exchange. Our Corporate Governance Guidelines will be available on our website as of the time of our listing on the New York Stock Exchange. The Code of Business Conduct and Ethics will be applicable to our directors, officers and employees, including our Chief Executive Officer, Chief Financial Officer and other senior officers effective as of the time of our listing on the New York Stock Exchange, in accordance with applicable rules and regulations of the SEC and the New York Stock Exchange. Our Code of Business Conduct and Ethics will be available on our website as of the time of our listing on the New York Stock Exchange.
Director Nomination Process
As discussed above, we intend to establish a Nominating and Corporate Governance Committee which will develop criteria for filling vacant Board of Directors positions, taking into consideration such factors as it deems appropriate, including the candidate’s education and background, his or her general business experience and familiarity with our business and whether he or she possesses unique expertise or perspective that will be of value to us. After completing this evaluation, the Nominating and Corporate Governance Committee will make recommendations to the full Board of Directors which in turn will make the final determination whether to nominate or appoint the new director after considering the Nominating and Corporate Governance Committee’s recommendation.
 
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 EXECUTIVE COMPENSATION
Introduction
Prior to the distribution, we have been a wholly-owned subsidiary of Tribune. Until the distribution, our compensation decisions will be made by Tribune’s senior management and the compensation committee of Tribune’s board of directors. The compensation program for our executive officers following the distribution has not yet been determined, but we expect that it will generally include base salary, an annual cash bonus and long term equity awards, on the terms described under “—Key Elements of Expected Compensation from Tribune Publishing Company”.
Effective upon completion of the distribution, our board of directors will have a Compensation Committee. See “Management—Corporate Governance—Committees of our Board of Directors—Compensation Committee.” Following the distribution, our Compensation Committee will commence to oversee, evaluate and review all aspects of compensation and may make adjustments to the compensation arrangements that we currently have in place with our executive officers that the Compensation Committee believes are appropriate.
Compensation Philosophy
To date, the compensation philosophy of our company has been determined by Tribune and its compensation committee. Following the distribution, our Compensation Committee will review and consider this philosophy and may make adjustments as appropriate. The current compensation philosophy for our company aims to achieve the following:
 
 	—  	 	Attract and retain top talent;	
 
 	—  	 	Motivate and reward the performance of senior executives in support of achievement of strategic, financial and operating performance objectives;	
 
 	—  	 	Ensure that our total compensation packages are competitive in comparison to those offered by our peers and that our compensation practices are consistent with high standards of corporate governance and best practices within our industry; and	
 
 	—  	 	Align our executives’ interests with the long-term interests of our stockholders.	
Primary Elements of Compensation
Base Salary . Base salary is the fixed portion of an executive officer’s annual cash compensation and is intended to provide compensation for expected day-to-day performance. Each of our executive officers is currently paid base salary. Factors that we expect our Compensation Committee will consider in making determinations about the base salaries for our executive officers following the distribution include the context of the executive officer’s particular position, responsibilities associated with that position, length of service with the company, experience, expertise, knowledge and qualifications, the industry in which we operate, recruitment and retention factors, the executive officer’s individual compensation history, salary levels of our other executives and similarly situated executives at comparable companies. As further described below, Tribune Publishing Company, LLC (“Publishing LLC”), a wholly-owned subsidiary of Tribune (which subsidiary will be transferred to Tribune Publishing Company at the distribution), is party to employment agreements with our Chief Executive Officer and Chief Financial Officer that provide for a specified or minimum base salary determined in accordance with these criteria. See “—Key Elements of Expected Compensation from Tribune Publishing Company”.
 
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Annual Bonuses . Our executive officers also are eligible for annual bonuses. For the current 2014 fiscal year, Tribune’s compensation committee has established the applicable percentages and metrics, but we expect that following the distribution our Compensation Committee may make appropriate adjustments to reflect that the distribution has occurred and our new status as an independent publicly-traded company. Also, we expect that for future years our Compensation Committee will establish target cash bonus percentages for our executives based on an annual bonus framework which will foster a performance-driven, pay-for-performance culture that aligns our executive officers’ interests with those of our stockholders while also rewarding the executive officers for superior individual achievements. We anticipate that following the distribution these annual bonuses will be made under the Tribune Publishing Company 2014 Omnibus Incentive Plan (the “Omnibus Incentive Plan”). Tribune’s compensation committee approved the Omnibus Incentive Plan on April 1, 2014. For further detail, see “—New Omnibus Incentive Plan”. Also, as described below, Publishing LLC is party to employment agreements with our Chief Executive Officer and Chief Financial Officer that provide for annual cash bonuses to them as a percentage of their respective annual base salary, subject to their achievement of company and individual performance criteria, which to date has been determined by Tribune’s compensation committee and which following the distribution will be determined by our Compensation Committee. See “—Key Elements of Expected Compensation from Tribune Publishing Company”.
Long-Term Equity-Based Incentive Awards . We anticipate that following the distribution our executive officers will be eligible to receive long-term equity or equity-based awards under the Omnibus Incentive Plan. For a description of the Omnibus Incentive Plan, see”—New Omnibus Incentive Plan”. As of the distribution, our Compensation Committee will commence to oversee, evaluate and review the Omnibus Incentive Plan. The Omnibus Incentive Plan provides a framework for granting equity awards to our executives to align their compensation with the long-term performance of our company and link their interests directly with those of our stockholders. Also, as described below, Publishing LLC is party to employment agreements with our Chief Executive Officer and Chief Financial Officer that provide for equity awards to be made to them on an annual basis during the term of his employment agreement beginning with 2014 in the case of our Chief Executive Officer and for 2014 and 2015 in the case of our CFO.
No equity awards have yet been granted to our executive officers in 2014. We expect that shortly following the distribution, Tribune Publishing will grant them a mix of Tribune Publishing stock options and restricted stock units under the Omnibus Incentive Plan, in amounts and on terms and conditions to be determined by Tribune Publishing’s compensation committee. Although the specific terms of these stock options and restricted stock units have not yet been determined, we expect those awards will reflect the general terms provided in the Omnibus Incentive Plan, including with respect to rights upon termination of employment and a change in control. For a description of those general terms, see “—New Omnibus Incentive Plan”.
In addition, our initial executive officers (other than our Chief Executive Officer and Chief Financial Officer) currently hold Tribune equity awards. Pursuant to the Employee Matters Agreement, their Tribune equity awards will be converted into Tribune Publishing equity awards in connection with, and effective upon, the distribution. See “Relationships between Tribune and Tribune Publishing following the Distribution—Employee Matters Agreement”.
This means that, effective upon the distribution, our executive officers will hold equity awards representing Tribune Publishing common stock.
Executive Officers of Tribune Publishing Company
We anticipate that our initial named executive officers following the distribution will be:
 
 	—  	 	John H. Griffin, Jr., Chief Executive Officer	
 
 	—  	 	John B. Bode, Chief Financial Officer	
 
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 	—  	 	Tony Hunter, Publisher and Chief Executive Officer of Chicago Tribune Company	
 
 	—  	 	Timothy E. Ryan, Publisher and Chief Executive Officer, The Baltimore Sun and The Morning Call	
 
 	—  	 	Howard Greenberg, Publisher and Chief Executive Officer, Orlando Sentinel and South Florida Sun-Sentinel	
Tribune Publishing Company was formed in connection with the distribution, and none of our executive officers were appointed to a position with Tribune Publishing Company before January 1, 2014.
Key Elements of Expected Compensation from Tribune Publishing Company
John H. Griffin, Jr.
On March 3, 2014, Publishing LLC entered into an employment agreement with Mr. John H. Griffin, Jr., which provides for him to serve as our Chief Executive Officer effective April 14, 2014 until March 31, 2017. Either Mr. Griffin or we may request to negotiate a renewal of his employment agreement by written request no later than 180 days prior to March 31, 2017. Following the distribution, we will continue to be bound by this employment agreement through its term.
Pursuant to his employment agreement, Mr. Griffin will receive an annual base salary of $1,000,000. He will also be entitled to receive an annual cash bonus with a target of 100% of base salary, which shall be pro-rated for 2014 to reflect his actual period of employment for 2014.
Mr. Griffin’s employment agreement provides that beginning with 2014 and through the term of his employment agreement, he will receive annual grants of Tribune Publishing equity awards having an aggregate fair market value of $1,500,000 based on the fair market value on the grant date. The equity awards shall be subject to such other terms as set forth in the Omnibus Incentive Plan and applicable award agreements.
Mr. Griffin is entitled to participate in the benefit plans and programs to be adopted by us, including any medical, dental, life, and 401(k) plans. Additionally, Mr. Griffin’s employment agreement provides for certain payments and benefits to him upon his separation from us as described in “—Potential Payments Upon Termination”.
Mr. Griffin’s employment agreement also contains certain restrictive covenants for our benefit, including his agreement not to compete with us or solicit or hire our employees during his employment and during the one year period following termination of his employment. He is also required to maintain the confidentiality of our confidential information.
John B. Bode
On September 11, 2013, Publishing LLC entered into an employment agreement with Mr. John B. Bode, which provides for him to serve as our Chief Financial Officer effective September 30, 2013 for a term of two years. Following the distribution, we will continue to be bound by this employment agreement through its term.
Pursuant to his employment agreement, Mr. Bode will receive an annual base salary of $450,000. He will also be entitled to receive an annual cash bonus with a target of 75% of base salary.
Mr. Bode’s employment agreement provides that for 2014 and 2015, subject to his continued employment, he will receive annual equity grants having an aggregate fair market value of $450,000 on the grant date, of which half of the award will be stock options and half restricted stock units. These equity awards will vest in four equal annual installments over a four year period from the grant date and otherwise be subject to such other terms as set forth in the Omnibus Incentive Plan and applicable award agreements. We anticipate that, in connection with the distribution, this provision of Mr. Bode’s employment agreement will be amended to clarify
 
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that any future equity awards that he receives for his employment by us will be Tribune Publishing equity awards granted under the Omnibus Incentive Plan.
Mr. Bode is entitled to participate in the benefit plans and programs to be adopted by us, including any medical, dental, vision, life, disability, retirement and other health and welfare plans. Additionally, Mr. Bode’s employment agreement provides for certain payments and benefits to him upon his separation from us as described in “—Potential Payments Upon Termination”.
Mr. Bode’s employment agreement also contains certain restrictive covenants for our benefit, including his agreement not to solicit or hire our employees during his employment and during the 12-month period following termination of his employment. He is also required to maintain the confidentiality of our confidential information.
Messrs. Hunter, Ryan and Greenberg
The amount and timing of any compensation, including equity-based compensation, to be paid to Mr. Hunter, Mr. Ryan and Mr. Greenberg following the distribution will be determined by our Compensation Committee. Any annual cash bonuses and awards of equity-based compensation to them are expected to be made pursuant to the Omnibus Incentive Plan, which is described in “—New Omnibus Incentive Plan”.
Potential Payments Upon Termination
The employment agreements of each of Mr. Griffin and Mr. Bode provide for certain payments and benefits upon a separation from us. There are no similar arrangements currently in place with respect to Messrs. Hunter, Ryan or Greenberg.
John H. Griffin, Jr.
Pursuant to his employment agreement, if we terminate Mr. Griffin’s employment without cause (and other than due to death or disability) or he resigns for good reason or we do not renew his employment agreement for a term of at least one year on substantially equivalent terms, subject to his execution and non-revocation of a release of claims, we will pay him, in addition to his previously accrued compensation, severance of $2,000,000 over a 12 month period and bear the cost we would otherwise pay during such period for him to continue his health and dental insurance benefits, at active employee rates (until he otherwise becomes eligible for comparable coverage under another employer’s benefit plans). Also, effective upon such an involuntary termination of his employment, a portion of any equity awards granted under his employment agreement that are then unvested but would have vested in the ordinary course over the one year period following his termination of employment will become vested. The terms “cause” and “good reason” are defined in his employment agreement.
John B. Bode
Pursuant to his employment agreement, if we terminate Mr. Bode’s employment without cause (and other than due to death or disability), subject to his execution and non-revocation of a release of claims, we will pay him, in addition to his previously accrued compensation, severance in a lump sum payment equal to 12 months of his base salary over a 12 month period. The term “cause” is defined in his employment agreement.
Other Named Executive Officers
The amount and timing of any termination pay or benefits that would be paid to any of Messrs. Hunter, Ryan or Greenberg following the distribution will be determined by our Compensation Committee. The consequences of a termination of their employment upon any equity awards granted to them will be provided in the applicable award agreements and the Omnibus Incentive Plan.
 
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New Omnibus Incentive Plan
On April 1, 2014, Tribune’s compensation committee, acting for Tribune as Tribune Publishing’s sole shareholder, approved the Tribune Publishing Company 2014 Omnibus Incentive Plan, the terms of which are summarized below.
General
The purposes of the Omnibus Incentive Plan are to attract and retain key personnel, including non-employee directors, and to provide a means whereby directors, officers, employees, consultants and advisors of Tribune Publishing and its affiliates can acquire and maintain an equity interest in Tribune Publishing, or be paid incentive compensation, thereby strengthening their commitment to the welfare of Tribune Publishing and its affiliates and aligning their interests with those of Tribune Publishing’s shareholders. In addition, the Omnibus Incentive Plan is expected to provide for the assumption of certain awards pursuant to the adjustment of awards granted under the current Tribune Company 2013 Equity Incentive Plan, as described in the Employee Matters Agreement. See “Relationships between Tribune and Tribune Publishing following the Distribution—Employee Matters Agreement”.
Eligibility
In addition to individuals who hold outstanding adjusted awards, persons who serve as employees, officers, non-employee directors, consultants and advisors of Tribune Publishing or its affiliates will be eligible to be granted awards under the Omnibus Incentive Plan.
Administration
The Omnibus Incentive Plan will be administered by the Compensation Committee or such other committee as the Board of Directors of Tribune Publishing may from time to time designate (the “Plan Committee”). Among other things, the Plan Committee will have the authority to select individuals to whom awards may be granted, to determine the type of award as well as the number of shares of Tribune Publishing common stock to be covered by each award, and to determine the terms and conditions of any such awards. The Plan Committee may delegate all or any portion of this authority to any person or persons, other than with respect to awards to officers or directors of Tribune Publishing subject to the reporting requirements of Section 16(a) of the Exchange Act, and only to the extent that such delegation is permitted under applicable law. The Plan Committee, pursuant to the terms of the Omnibus Incentive Plan, will also make all other necessary decisions and interpretations under the Omnibus Incentive Plan. Prior to the distribution, the Compensation Committee of the Tribune Company will serve as the Plan Committee and will authorize the awards to be made under the Omnibus Incentive Plan, including awards made in substitution for awards currently outstanding under the Tribune Company 2013 Equity Incentive Plan.
Shares Subject to the Omnibus Incentive Plan
Under the Omnibus Incentive Plan, the Plan Committee may grant awards of various types of compensation, including stock options (which may be either incentive stock options or non-qualified stock options), stock appreciation rights (“SARs”), restricted stock and restricted stock units (“RSUs”), performance shares and performance units, dividend equivalents, cash awards and other types of equity-based awards.
The maximum number of shares of common stock of Tribune Publishing that may be issued under the Omnibus Incentive Plan is [ — ], all of which may be issued in the form of incentive stock options. This maximum number represents 10% of Tribune Publishing’s common stock outstanding immediately after the distribution. Shares issued under the Omnibus Incentive Plan may be authorized but unissued shares, shares held in the treasury of Tribune Publishing, shares purchased on the open market or by private purchase, or a combination of the foregoing.
 
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For those awards intended to qualify as performance-based compensation under 162(m) of the Code, during a calendar year, no single participant may be granted (a) more than 250,000 stock options, stock appreciation rights or any other award based solely on the increase in value of the common stock from the date of grant, (b) more than 200,000 performance shares, performance units to be settled in common stock or other stock-based awards, or (c) performance units to be settled in cash or cash awards with a value of more than $3,000,000 (or the equivalent of such amount denominated by the participant’s local currency).
Any shares covered by an award granted under the Omnibus Incentive Plan will be deemed to have been used in settlement of awards whether or not they are actually delivered, provided that if the fair market value equivalent of such shares is paid in cash, such shares will again become available for other awards under the Omnibus Incentive Plan. In addition, any shares tendered or withheld to satisfy the grant or exercise price or tax withholding obligations pursuant to any award under the Omnibus Incentive Plan will again become available for issuance. To the extent that any award expires, terminates, is canceled or forfeited, including if shares are not issued on the settlement of awards, without the participant having received any benefit therefrom, the shares covered by such award will again become available for awards under the Omnibus Incentive Plan. The Omnibus Incentive Plan permits Tribune Publishing to issue substitute awards to service providers of companies acquired by Tribune Publishing, but those substitute awards would not count against the share maximum listed above.
The number of shares of common stock or other securities covered by outstanding awards (including the various maximum limitations), the number and kind of shares or other property that may be delivered under the Omnibus Incentive Plan, the exercise or purchase price of each outstanding award, and the other terms of outstanding awards, will be subject to adjustment by the Plan Committee in the event of any dividend, recapitalization, stock split, reorganization, merger, spin-off, repurchase or other similar corporate transaction or event affecting the common stock (including, but not limited to, a change in control). Any such adjustment would not be considered repricing for purposes of the prohibition on repricing described below.
As indicated above, several types of grants can be made under the Omnibus Incentive Plan. A summary of these grants is set forth below. The Omnibus Incentive Plan will govern Tribune Publishing options and Tribune Publishing restricted stock units that convert from existing Tribune options and Tribune restricted stock units in connection with the distribution as well as other award grants made at the time of or following the distribution pursuant to the Omnibus Incentive Plan.
Stock Options and Stock Appreciation Rights
The Plan Committee may grant awards of stock options and SARs under the Omnibus Incentive Plan. The stock options may be either “incentive stock options” (as that term is defined in Section 422 of the Code), which provide the recipient with favorable tax treatment, or options that are not incentive stock options (“non-qualified stock options”). The terms of options and SARs will be as determined by the Plan Committee and reflected in the award agreements, but the exercise period for any stock options and SARs awarded under the Omnibus Incentive Plan may not extend beyond ten years from the date of grant. The Plan Committee has the authority to determine the terms and conditions of the stock options and SARs, including the number of shares subject to each stock option and SAR, the vesting and exercise schedule of each stock option and SAR, and the exercise price of each option and strike price of each SAR (which must be at least the fair market value of the stock underlying the award on the date of grant).
The exercise price of the options (and any applicable required withholding taxes) will be payable in any manner approved by the Plan Committee or provided in an applicable award agreement which may include, but is not limited to, cash, Tribune Publishing common stock (valued at its fair market value on the date of exercise) or a combination thereof, or by a “cashless exercise” through a broker or by withholding shares otherwise receivable on exercise.
SARs are similar to stock options, except that no exercise price is required to be paid. Upon exercise of a SAR, the participant will receive payment equal to the increase in the fair market value of a share of common
 
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stock on the date of exercise over the strike price (which is no less than the fair market value of a share of common stock on the date of grant) times the number of shares of common stock as to which the SAR is being exercised. The payment will be made in cash, in shares of common stock of Tribune Publishing, or any combination thereof. Any fractional shares of common stock will be settled in cash.
Except as otherwise provided in an award, employment, consulting, change in control, severance or other agreement between a participant and Tribune Publishing or an affiliate, if a participant’s service is terminated by reason of death or disability, all stock options and SARs held by the participant at the date of termination will vest and become exercisable and will remain exercisable until the earlier of (i) the first anniversary of such termination or (ii) the expiration date of the option or SAR. If a participant’s service is terminated by reason of retirement, the unvested portion of an option or SAR will vest and the vested portion of such awards will become exercisable until the earlier of (i) the third anniversary of such termination or (ii) the expiration date of the option or SAR. Upon termination of service for “cause” (as defined in the Omnibus Incentive Plan), all stock options and SARs (whether or not then vested and exercisable) will be immediately cancelled. If a participant’s service is terminated for any other reason, any stock options and SARs held by the participant that have not become vested and exercisable will be immediately cancelled and any stock options and SARs that have become vested and exercisable will remain exercisable for 90 days following such termination.
The Omnibus Incentive Plan prohibits repricing of options and SARs without shareholder approval.
Restricted Stock and RSUs
The Plan Committee may grant awards of restricted stock and RSUs under the Omnibus Incentive Plan. The Plan Committee has the authority to determine the terms and conditions of the restricted stock and RSUs, including the restricted periods during which the awards are subject to forfeiture. Upon expiration of the restricted period with respect to restricted stock, the restricted stock will no longer be subject to forfeiture and, upon expiration of the restricted period with respect to each RSU, Tribune Publishing will deliver a share of common stock, or at the Plan Committee’s discretion, cash or a combination of shares of common stock and cash.
Except as otherwise provided in an award, employment, consulting, change in control, severance or other agreement between a participant and Tribune Publishing or an affiliate, if a participant’s service is terminated by reason of death, disability, or retirement, the unvested portion of any restricted stock or RSUs held by the participant will become vested and no longer be forfeitable as of the date of termination. If a participant’s service is terminated for any other reason, any unvested portion of any restricted stock or RSU held by the participant will terminate and be forfeited.
Performance Awards; Performance Criteria
The Plan Committee may grant awards of performance shares, performance units or cash awards (collectively, the “Performance Awards”) under the Omnibus Incentive Plan based upon the achievement of specified performance objectives or the occurrence of other events, as determined by the Plan Committee in its discretion. The Plan Committee has the authority to determine other terms and conditions of the Performance Awards, including conditioning payment on the participant’s completing a minimum period of service following the grant date.
The Plan Committee may establish performance goals applicable to any Performance Award. When establishing a performance goal, the Plan Committee will determine the performance cycle over which performance against the goal will be measured and the amount of cash or number or value of shares of common stock that may be earned based on the level of the performance goal achieved. Additional provisions that relate to the setting of the performance goal, certifying achievement of performance against the goal and the amount
 
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earned, and exercising negative discretion to reduce the amount earned and that apply to awards made to executive officers are intended to meet the tax deductibility rules for “performance-based” compensation under Section 162(m) of the Code.
The Omnibus Incentive Plan provides that the Plan Committee may base the performance goals upon one or more of the following performance criteria: (A) net or operating income (before or after taxes); (B) earnings before taxes, interest, depreciation and/or amortization (“EBITDA”); (C) net income before equity in earnings of unconsolidated affiliates, income tax expense, loss on early debt extinguishment, interest and other (expense) income, realized gain (loss) on investments, interest expense, equity-based compensation expense, related party management fees, restructuring charges and depreciation and amortization expense and net income attributable to noncontrolling interests (“Adjusted EBITDA”); (D) basic or diluted earnings per share or improvement in basic or diluted earnings per share; (E) sales (including, but not limited to, total sales, net sales and revenue growth); (F) net operating profit; (G) financial return measures (including, but not limited to, return on assets, capital, invested capital, equity, sales and revenue); (H) cash flow measures (including, but not limited to, operating cash flow, free cash flow, cash flow return on equity and cash flow return on investment); (I) productivity ratios (including, but not limited to, measuring liquidity, profitability and leverage); (J) share price (including, but not limited to, growth measures and total shareholder return); (K) expense/cost management targets; (L) margins (including, but not limited to, operating margin, net income margin, cash margin, gross, net or operating profit margins, EBITDA margins and Adjusted EBITDA margins); (M) operating efficiency; (N) market share or market penetration; (O) customer targets (including, but not limited to, customer growth and customer satisfaction); (P) working capital targets or improvements; (Q) economic value added; (R) balance sheet metrics (including, but not limited to, inventory, inventory turns, receivables turnover, net asset turnover, debt reduction, retained earnings, year-end cash, cash conversion cycle and ratio of debt to equity or to EBITDA); (S) workforce targets (including, but not limited to, diversity goals, employee engagement or satisfaction, employee retention and workplace health and safety goals); (T) implementation, completion or attainment of measurable objectives with respect to research and development, key products or key projects, lines of business, acquisitions and divestitures and strategic plan development and/or implementation; (U) comparisons with various stock market indices, peer companies or industry groups or classifications with regard to one more of these criteria. At any time when Section 162(m) is not applicable to Tribune Publishing and the Omnibus Incentive Plan and for persons whose compensation is not subject to Section 162(m) of the Code, performance goals may be based on such other criteria as may be determined by the Plan Committee. Performance criteria may be established on a company-wide basis or with respect to one or more business units, divisions or affiliates. When establishing performance criteria for a performance cycle, the Plan Committee may exclude any or all charges or costs associated with restructurings for Tribune Publishing or any subsidiary, discontinued operations, other unusual or non-recurring items, the cumulative effects of accounting changes, or such other objective factors as the Plan Committee deems appropriate.
Unless otherwise provided in an award, employment, consulting, change in control, severance or other agreement between a participant and Tribune Publishing or an affiliate, if a participant’s service is terminated by reason of death, disability, or retirement during the performance cycle, unvested cash awards will terminate and be forfeited and unvested performance shares and performance units will be deemed to be earned and become vested and/or paid out on the basis of actual achievement of the performance goals for such performance cycle, prorated for the portion of the performance cycle prior to such termination of service. If a participant’s service is terminated for any other reason, the unvested Performance Awards will immediately be terminated and forfeited (unless otherwise provided in an award, employment, consulting, change in control, severance or other agreement).
Other Stock-Based Awards
The Plan Committee may grant other equity-based or equity-related awards not otherwise described by the terms of the Omnibus Incentive Plan.
 
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Dividends and Dividend Equivalents
The Plan Committee may, in its discretion, grant dividends or dividend equivalents to a participant in tandem with another award or as freestanding awards. Except in the event of a corporate transaction that results in the adjustment of such awards under the provisions of the Omnibus Incentive Plan, no dividend equivalents may be credited in respect of options or SARs.
Effect of a Change in Control
Upon a change in control, unless otherwise determined by the Plan Committee or as provided in a participant’s award, employment, consulting, change in control, severance or other agreement, no cancellation, acceleration of exercisability or vesting, lapse of any restricted period or settlement or other payment shall occur with respect to any outstanding awards, if the Plan Committee reasonably determines in good faith, prior to the occurrence of the change in control, that such outstanding awards will be honored or assumed or new rights substituted therefore (such honored, assumed or substituted awards, “Alternative Awards”). Alternative Awards must provide a participant with substantially equivalent rights and entitlements and provide for accelerated vesting in the event a participant’s employment is terminated without “cause” within 12 months after the change in control.
If the Plan Committee reasonably determines in good faith, prior to the occurrence of the change in control, that no Alternative Awards will be provided, then, (A) each outstanding option and SAR will vest and be canceled in exchange for a cash payment equal to (x) the excess, if any, of the change in control price over the exercise price of such option or SAR, multiplied by (y) the aggregate number of shares of common stock covered by such award; (B) each outstanding Performance Award with a performance cycle in progress at the time of the change in control shall be deemed to be earned and become vested and paid out based on the performance goals achieved as of the date of the change in control (which performance goals shall be pro-rated, if necessary or appropriate, to reflect the portion of the performance cycle that has been completed), and all other Performance Awards shall terminate and be forfeited upon consummation of the change in control; (C) cash awards that are vested but unpaid shall be paid in cash; and (D) each outstanding restricted stock, RSU and other stock-based awards shall vest, the restricted period (if any) on all such outstanding awards shall lapse and be canceled in exchange for a cash payment equal to (x) the change in control price, multiplied by (y) the aggregate number of shares of common stock covered by such award; provided, however that no award that is subject to Section 409A of the Code shall be canceled in exchange for a cash payment unless such payment may be made without the imposition of any additional taxes or interest under Section 409A of the Code.
The Plan Committee may determine, in its discretion, to cancel some or all awards in exchange for a cash payment based on the change in control price. The Plan Committee may also, in its discretion, accelerate the exercisability or vesting or lapse of any restricted period with respect to all or any portion of any outstanding award.
Amendment and Termination
The board of directors of Tribune Publishing may amend or terminate the Omnibus Incentive Plan at any time, but no amendment or termination may materially and adversely affect the rights of any participant without the participant’s consent. Amendments to the Omnibus Incentive Plan will require shareholder approval if such approval is required by tax or regulatory law or requirement. The Omnibus Incentive Plan, therefore, cannot be amended to remove the prohibition on re-pricing or to permit the grant of options or SARs at below fair market value exercise prices without stockholder approval.
 
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 DIRECTOR COMPENSATION
Prior to the distribution, we have been a wholly-owned subsidiary of Tribune and, during that time, decisions about director compensation for our company were made by Tribune’s compensation committee. Following the distribution, director compensation will be reviewed by our Compensation Committee. Accordingly, Tribune’s compensation committee has approved a director compensation program for our non-employee directors, with the following features, which shall apply upon completion of the distribution.
Each of our non-employee directors will receive an annual cash retainer of $70,000 and an annual equity retainer of an award of restricted stock units of Tribune Publishing with a fair market value equal to $80,000 on the date of grant. The awards of restricted stock units will be granted pursuant to the Omnibus Incentive Plan, on terms and conditions to be determined by our Compensation Committee.
Additionally, under the program, a non-employee director appointed to serve as chairman of the Board of Directors will receive an annual equity retainer of an award of restricted stock units of Tribune Publishing with a fair market value equal to $50,000 on the date of grant. This award of restricted stock units will be granted pursuant to the Omnibus Incentive Plan. Also, a non-employee director appointed to serve as the chair of the Audit Committee will receive an additional annual cash retainer of $20,000, a non-employee director appointed to serve as the chair of the Compensation Committee will receive an additional cash retainer of $15,000, and a non-employee director appointed to serve as the chair of the Nominating and Corporate Governance Committee will receive an additional cash retainer of $10,000.
We anticipate that our non-employee directors will be able to convert all or a portion of their retainer into deferred stock units to be settled on termination of board service. Any such deferred stock units will be granted under the Omnibus Incentive Plan.
Under this program, no directors’ fees will be paid to Mr. Griffin for his service as a member of our board of directors, because his responsibilities as a director are considered an element of his employment for which he is otherwise compensated. See “Executive Compensation—Primary Elements of Compensation”.
Prior to the distribution, Mr. Hartenstein served in various capacities within Tribune pursuant to an employment agreement with Tribune, including most recently as Publisher and Chief Executive Officer of the Los Angeles Times and a special advisor to the CEO of Tribune. Mr. Hartenstein resigned from these positions effective as of [•], 2014 and became the Non-Executive Chairman of our Board of Directors. During his service, Mr. Hartenstein received certain equity awards in respect of Tribune common stock, including stock options and restricted stock units. Mr. Hartenstein’s previously granted Tribune stock options and restricted stock units continue to be outstanding and will be converted in the distribution into awards related to Tribune Publishing common stock using the same conversion formula as will apply generally to employees of Tribune Publishing. Mr. Hartenstein will be credited for all purposes of such awards with his service as Non-Executive Chairman of the Board of Directors. Tribune will remain responsible for all other compensation payable to Mr. Hartenstein for his services prior to the distribution.
 
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 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Before the distribution, all of the outstanding shares of Tribune Publishing’s common stock will be owned beneficially and of record by Tribune. The following table sets forth information regarding the anticipated beneficial ownership of Tribune Publishing’s common stock immediately following the completion of the distribution for (A) each person who is known by us to beneficially own an amount of issued and outstanding Tribune Class A common stock, Class B common stock or Warrants which would represent beneficial ownership of more than 5% of the shares of common stock of Tribune Publishing immediately following the completion of the distribution and (B) each of (1) our directors, (2) our executive officers and (3) our directors and executive officers as a group. The beneficial ownership of Tribune Publishing’s common stock presented in the table is based on our knowledge of the beneficial ownership of Tribune Class A common stock, Class B common stock and Warrants as of April 30, 2014, and the distribution of 0.25 of a share of Tribune Publishing common stock for each share of Tribune Class A common stock, Class B common stock or Warrant. Because Tribune is not an SEC reporting company as of the date hereof, and thus Tribune’s significant stockholders are not subject to the reporting requirements of Section 13 of the Exchange Act, there may be additional persons, currently unknown to us, who own an amount of issued and outstanding Tribune Class A common stock, Class B common stock or Warrants which would represent beneficial ownership of more than 5% of the shares of common stock of Tribune Publishing immediately following the completion of the distribution. Unless otherwise indicated, the address for each beneficial owner who is also a director or executive officer is 435 North Michigan Avenue, Chicago, Illinois 60611.

 	 	Common Stock Beneficially Owned	 	
Name	 	Number of Shares
Beneficially Owned	 	  	Percent of Class (1)	 	
Oaktree Tribune, L.P. (2)	 	 	4,691,371	  	  	 	18.5	% 	
Investment funds managed by Angelo, Gordon & Co. L.P. (3)	 	 	2,244,452	  	  	 	8.8	% 	
Entities affiliated with JPMorgan Chase Bank, N.A. (4)	 	 	2,133,706	  	  	 	8.4	% 	
Franklin Mutual Advisers LLC (5)	 	 	1,596,478	  	  	 	6.3	% 	
John H. Griffin, Jr.	 				  	 	*	  	
John B. Bode	 				  	 	*	  	
Howard Greenberg	 				  	 	*	  	
Tony Hunter	 				  	 	*	  	
Timothy E. Ryan	 				  	 	*	  	
Julie K. Xanders	 				  	 	*	  	
Eddy W. Hartenstein	 				  	 	*	  	
David E. Dibble	 	 	—  	  	  	 	—  	  	
Philip G. Franklin	 	 	—  	  	  	 	—  	  	
Renetta McCann	 	 	—  	  	  	 	—  	  	
Ellen Taus	 	 	—  	  	  	 	—  	  	
All directors and executive officers as a group (11 persons)	 				  				

*	Represents beneficial ownership of less than one percent (1%).	
(1)	Applicable percentage of ownership is based on 93,200,158 shares of Tribune Class A common stock, 2,946,097 shares of Tribune Class B common stock and 4,001,745 Warrants outstanding as of April 30, 2014.	
(2)	According to information provided to Tribune by Oaktree Capital Management, L.P., as of April 30, 2014, Oaktree Tribune, L.P. beneficially owned 18,765,484 shares of Tribune Class A common stock. The general partner of Oaktree Tribune, L.P. is Oaktree AIF Investments, L.P. (“AIF Investments”). The general partner of AIF Investments is Oaktree AIF Holdings, Inc. (“AIF Holdings”). The holder of all of the voting shares of AIF Holdings is Oaktree Capital Group Holdings, L.P. (“OCGH”). The general partner of OCGH is Oaktree Capital Group Holdings GP, LLC (“OCGH GP”). The media company business of OCGH GP is managed by a media company committee, which controls the decisions of OCGH GP with respect to the	
 
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 	vote and disposition of the shares held by Oaktree Tribune, L.P. The members of such committee are Howard S. Marks, Bruce A. Karsh, John B. Frank, David M. Kirchheimer and Stephen A. Kaplan. Excludes 15,400 shares of Tribune Class A common stock held by OCM FIE, LLC, an Oaktree affiliated entity. The address of Oaktree Tribune, L.P. is 333 S. Grand Avenue, 28 th Floor, Los Angeles, California 90071.	
(3)	According to information provided to Tribune by Angelo, Gordon & Co. L.P., as of April 30, 2014, investment funds managed by Angelo, Gordon & Co. L.P. beneficially owned 8,977,808 shares of Tribune Class A common stock. The address of Angelo, Gordon & Co. L.P. is 245 Park Ave, 26 th Floor, New York, NY 10167.	
(4)	According to information provided to Tribune by JPMorgan Chase & Co., as of April 30, 2014, certain subsidiaries of JPMorgan Chase & Co. beneficially owned 8,059,046 shares of Tribune Class A common stock and 475,778 shares of Tribune Class B common stock. JPMorgan Chase & Co. is a publicly traded company. The address of JPMorgan Chase & Co. is 270 Park Ave., New York, NY 10017.	
(5)	According to information provided to Tribune by Franklin Mutual Advisers LLC, as of April 30, 2014, investment funds managed by Franklin Mutual Advisers LLC beneficially owned 3,873,380 shares of Tribune Class A common stock, 2,374,063 shares of Tribune Class B common stock and 138,469 Warrants. The address of Franklin Mutual Advisers LLC is 101 John F. Kennedy Parkway, Short Hills, NJ 07078.	
 
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 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Procedures for Approval of Related Person Transactions
Prior to the completion of the distribution, we expect that our Board of Directors will approve policies and procedures with respect to the review and approval of certain transactions between Tribune Publishing and a “Related Person” (a “Related Person Transaction”), which we refer to as our “Related Person Transaction Policy.” Pursuant to the terms of the Related Person Transaction Policy, any Related Person Transaction will be required to be reported to the legal department, which will then determine whether it should be submitted to our Audit Committee for consideration. The Audit Committee must then review and decide whether to approve any Related Person Transaction.
For the purposes of the Related Person Transaction Policy, we expect that a “Related Person Transaction” will be a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which Tribune Publishing (including any of its subsidiaries) was, is or will be a participant and the amount involved exceeds $120,000, and in which any Related Person had, has or will have a direct or indirect interest.
A “Related Person”, as defined in the Related Person Transaction Policy, means any person who is, or at any time since the beginning of our last fiscal year was, a director or executive officer of Tribune Publishing or a nominee to become a director of Tribune Publishing; any person who is known to be the beneficial owner of more than five percent of Tribune Publishing common stock; any immediate family member of any of the foregoing persons, including any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of the director, executive officer, nominee or more than five percent beneficial owner, and any person (other than a tenant or employee) sharing the household of such director, executive officer, nominee or more than five percent beneficial owner; and any firm, corporation or other entity in which any of the foregoing persons is a general partner or, for other ownership interests, a limited partner or other owner in which such person has a beneficial ownership interest of ten percent or more.
Related Person Transactions
Registration Rights Agreement
In connection with the distribution, we expect that Tribune Publishing, investment funds affiliated with Oaktree Capital Management, L.P. (the “Oaktree Funds”), entities affiliated with JPMorgan Chase Bank, N.A. (the “JPMorgan Entities”) and investment funds managed by Angelo, Gordon & Co., L.P. (the “Angelo Gordon Funds”) will enter into a registration rights agreement (the “Registration Rights Agreement”) which will grant the Oaktree Funds, the JPMorgan Entities and the Angelo Gordon Funds specified demand and piggyback registration rights with respect to the Tribune Publishing’s common stock. Under the Registration Rights Agreement, we will be required to use reasonable best efforts to effect the registration under the Securities Act of our common stock as requested by the holders of our securities that are a party to the Registration Rights Agreement, at our own expense. In addition, if we determine to register our common stock under the Securities Act, such holders will have the right to require us to use our reasonable best efforts to include in our registration statement shares of our common stock held by them, subject to certain limitations. The Registration Rights Agreement will also provide for us to indemnify certain of our stockholders in connection with the registration of our common stock. This summary is qualified in its entirety by reference to the Registration Rights Agreement, the form of which will be filed as an exhibit to a subsequent amendment to the registration statement on Form 10 of which this information statement is a part.
Agreements with Tribune
See “Relationships Between Tribune and Tribune Publishing Following the Distribution” for a description of the agreements that will exist between Tribune and Tribune Publishing following the distribution.
 
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Consulting Agreement
In January 2013, Tribune entered into a consulting agreement, and in September 2013, Tribune Publishing Company, LLC entered into a consulting agreement, with Empirical Media Advisors, LLC. At the date of each of the agreements, and prior to his appointment as Chief Executive Officer of Tribune Publishing, John H. Griffin, Jr. was a Co-founder, Chief Executive Officer and at least a 50% owner of Empirical Media Advisors, LLC. Under the consulting agreements, from January 1, 2013 through March 31, 2014, Empirical Media Advisors, LLC was paid a total of $2,492,327. Effective April 4, 2014, Mr. Griffin ceased to be Chief Executive Officer, or have any other financial interests in, Empirical Media Advisors, LLC.
 
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 DESCRIPTION OF CAPITAL STOCK
General
Following the distribution, our authorized capital stock will consist of 300,000,000 shares of common stock, par value $0.01 per share, and 30,000,000 shares of preferred stock, par value $0.01 per share.
Based on the number of Tribune shares of common stock and Warrants outstanding on         , 2014, approximately          shares of Tribune Publishing common stock will be issued to holders of common stock and Warrants of Tribune on the distribution date. In addition, Tribune will continue to hold approximately          shares of common stock following the distribution date. All of the shares of Tribune Publishing common stock to be distributed to Tribune stockholders in the distribution will be fully paid and non-assessable.
In connection with the distribution, we will amend and restate our certificate of incorporation and by-laws. The following summary describes certain provisions of Tribune Publishing’s amended and restated certificate of incorporation and amended and restated by-laws relating to its capital stock. This summary is qualified in its entirety by reference to Tribune Publishing’s amended and restated certificate of incorporation and amended and restated by-laws, the forms of which are filed as exhibits to the registration statement on Form 10 of which this information statement is a part.
Common Stock
Voting Rights
A holder of common stock shall be entitled to one vote for each share of common stock held by such holder of record on the books of Tribune Publishing for all matters on which stockholders of Tribune Publishing are entitled to vote. There shall be no cumulative voting.
Our amended and restated certificate of incorporation will provide the voting requirements for the election of directors. The affirmative vote of a plurality of the shares of our common stock present, in person or by proxy, at the meeting and entitled to vote at any annual or special meeting of stockholders will decide the election of any directors, and the affirmative vote of a majority of the shares of our common stock present, in person or by proxy, at the annual meeting and entitled to vote at any annual or special meeting of stockholders will decide all other matters voted on by stockholders, unless the question is one upon which, by express provision of law, under our amended and restated certificate of incorporation, or under our amended and restated by-laws, a different vote is required, in which case such provision will control.
Dividends
Holders of Tribune Publishing common stock will be entitled to participate ratably in such dividends, whether in cash, property, stock or otherwise, as may be declared by the Board of Directors from time to time out of assets or funds of Tribune Publishing legally available therefor, subject to the prior rights and preferences, if any, that may be applicable to preferred stock then outstanding. See “Dividend Policy.”
Liquidation
Holders of Tribune Publishing common stock will be entitled, upon our liquidation, dissolution or winding up, to share equally and ratably in any assets remaining after the payment of all debt and other liabilities, subject to the prior rights, if any, of holders of any outstanding shares of preferred stock.
In the event of any voluntary or involuntary liquidation, dissolution, distribution of all or substantially all of the assets or winding-up of Tribune Publishing, after all creditors of Tribune Publishing shall have been
 
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paid in full and after payment of all sums, if any, payable in respect of preferred stock, if any, the holders of the common stock shall be entitled to share ratably in all distributions of assets pursuant to such voluntary or involuntary liquidation, dissolution, distribution of all or substantially all of the assets or winding-up of Tribune Publishing.
No Preemptive Rights
No holder of any Tribune Publishing stock of any class authorized at the distribution date will have any preemptive right to subscribe to any Tribune Publishing securities of any kind or class.
Preferred Stock
Under our amended and restated certificate of incorporation, our Board of Directors will have the authority, without further action by our stockholders, to issue up to 30,000,000 shares of preferred stock in one or more series and to fix the designations, powers, preferences and the relative participating, optional or other special rights and qualifications, limitations and restrictions of each series, including dividend rights, dividend rates, conversion rights, voting rights, terms of redemption, liquidation preferences and the number of shares constituting any series. Upon completion of the distribution, no shares of our authorized preferred stock will be outstanding.
Anti-Takeover Effects of Various Provisions of Delaware Law, Our Amended and Restated Certificate of Incorporation and Amended and Restated By-laws
The provisions of our amended and restated certificate of incorporation and amended and restated by-laws may have an anti-takeover effect and may delay, defer or prevent a tender offer or takeover attempt that you might consider in your best interest, including an attempt that might result in your receipt of a premium over the market price for your shares. These provisions are also designed, in part, to encourage persons seeking to acquire control of us to first negotiate with our Board of Directors, which could result in an improvement of their terms.
Authorized but Unissued Shares of Capital Stock
Common Stock. The remaining shares of authorized and unissued common stock will be available for future issuance without additional stockholder approval. While the additional shares are not designed to deter or prevent a change of control, under some circumstances we could use the additional shares to create voting impediments or to frustrate persons seeking to effect a takeover or otherwise gain control by, for example, issuing those shares in private placements to purchasers who might side with our Board of Directors in opposing a hostile takeover bid.
Preferred Stock. The existence of authorized but unissued preferred stock could reduce our attractiveness as a target for an unsolicited takeover bid since we could, for example, issue shares of preferred stock to parties who might oppose such a takeover bid or shares that contain terms the potential acquiror may find unattractive. This may have the effect of delaying or preventing a change of control, may discourage bids for the common stock at a premium over the market price of the common stock, and may adversely affect the market price of, and the voting and other rights of the holders of, our common stock.
Size of Board and Vacancies; Removal
Our amended and restated by-laws will provide that any vacancy on our Board of Directors, including a vacancy resulting from any increase in the authorized number of directors, may be filled only by the affirmative vote of a majority of our directors then in office, even if less than a quorum, or by a sole remaining director. Any director elected to fill a vacancy will hold office until such director’s successor shall have been elected and qualified or until such director’s earlier death, resignation or removal.
 
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Amendment of the Certificate of Incorporation and By-laws
Our amended and restated certificate of incorporation will provide that our amended and restated certificate of incorporation may be amended by the affirmative vote of the holders of a majority of the outstanding shares of our common stock then entitled to vote at any annual or special meeting of stockholders; provided that specified provisions of our amended and restated certificate of incorporation may not be amended, altered or repealed unless the amendment is approved by the affirmative vote of the holders of at least 66  2 ⁄ 3 % of the outstanding shares of our common stock then entitled to vote at any annual or special meeting of stockholders, including the provisions governing:
 
 	—  	 	elimination of stockholder action by written consent; and	
 
 	—  	 	prohibition on the rights of stockholders to call a special meeting.	
In addition, our amended and restated certificate of incorporation and amended and restated by-laws will provide that our amended and restated by-laws may be amended, altered or repealed, or new by-laws may be adopted, by the affirmative vote of a majority of the Board of Directors, or by the affirmative vote of the holders of at least 66  2 ⁄ 3 % of the outstanding shares of our common stock then entitled to vote at any annual or special meeting of stockholders.
These provisions make it more difficult for any person to remove or amend any provisions in our amended and restated certificate of incorporation and amended and restated by-laws that may have an anti-takeover effect.
No Stockholder Action by Written Consent
Our amended and restated certificate of incorporation will provide that stockholder action may be taken only at an annual meeting or special meeting of stockholders and may not be taken by written consent in lieu of a meeting.
Stockholder Meetings
Our amended and restated by-laws will provide that annual stockholder meetings will be held at a date, time and place, if any, as exclusively selected by our Board of Directors. Our amended and restated certificate of incorporation will provide that a special meeting of stockholders may be called only by or at the direction of the Chairman of our Board of Directors, our Chief Executive Officer or our Board of Directors pursuant to a resolution adopted by a majority of our Board of Directors. Stockholders will not be permitted to call a special meeting.
Requirements for Advance Notice of Stockholder Nominations and Proposals
Our amended and restated by-laws will establish an advance notice procedure for stockholders to make nominations of candidates for election as directors or to bring other business before an annual meeting of our stockholders. Our amended and restated by-laws will provide that any stockholder wishing to nominate persons for election as directors at, or bring other business before, an annual meeting must deliver to our corporate secretary a written notice of the stockholder’s intention to do so. These provisions may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed. We expect that these provisions may also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company. To be timely, the stockholder’s notice must be delivered to our corporate secretary at our principal executive offices not less than 90 days nor more than 120 days before the first anniversary date of the annual meeting for the preceding year; provided, however, that in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, a stockholder’s notice must be delivered to our corporate secretary no later
 
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than the close of business on the 10th day following the day on which notice of the date of the annual meeting was first mailed or public disclosure of the date of the annual meeting was first made, whichever first occurs.
Choice of Forum
Our amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will, to the fullest extent permitted by law, be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of Tribune Publishing, (ii) any action asserting a claim of breach of a fiduciary duty owed to Tribune Publishing or Tribune Publishing’s stockholders by any of Tribune Publishing’s directors, officers, employees or agents, (iii) any action asserting a claim arising under the DGCL, our amended and restated certificate of incorporation or our amended and restated by-laws or (iv) any action asserting a claim that is governed by the internal affairs doctrine. We may consent in writing to alternative forums. By becoming a stockholder of Tribune Publishing, you will be deemed to have notice of and have consented to the provisions of our amended and restated certificate of incorporation related to choice of forum.
Section 203 of the Delaware General Corporation Law
Our amended and restated certificate of incorporation will provide that, beginning on the day following the distribution, we will be subject to Section 203 of the DGCL. Section 203 prohibits a publicly held Delaware corporation from engaging in a business combination, such as a merger, with a person or group owning 15% or more of the corporation’s outstanding voting stock for a period of three years following the date the person became an interested stockholder, unless:
 
 	—  	 	prior to such time, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;	
 
 	—  	 	upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, but not the outstanding voting stock owned by the interested stockholder, those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or	
 
 	—  	 	at or subsequent to such time, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66  2 ⁄ 3 % of the outstanding voting stock that is not owned by the interested stockholder.	
Generally, a business combination includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. An “interested stockholder” is any entity or person who, together with affiliates and associates, owns, or within the previous three years owned, 15% or more of the outstanding voting stock of the corporation. We expect the existence of this provision to have an anti-takeover effect with respect to transactions our Board of Directors does not approve in advance. We also anticipate that Section 203 may discourage attempts that might result in a premium over the market price for the shares of common stock held by stockholders.
Listing
We have applied to list our shares of common stock on the New York Stock Exchange under the symbol “TPUB”.
 
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Sales of Unregistered Securities
In connection with its incorporation, on November 21, 2013, Tribune Publishing issued 100 shares of Tribune Publishing common stock, par value $0.01 per share, to Tribune. Tribune Publishing did not register this issuance of securities under the Securities Act because it did not involve any public offering of securities.
Limitation of Liability and Indemnification of Officers and Directors
Our amended and restated certificate of incorporation will contain provisions permitted under DGCL relating to the liability of directors. These provisions will eliminate a director’s personal liability for monetary damages resulting from a breach of fiduciary duty, except in circumstances involving:
 
 	—  	 	any breach of the director’s duty of loyalty,	
 
 	—  	 	acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law,	
 
 	—  	 	Section 174 of the DGCL (unlawful dividends), or	
 
 	—  	 	any transaction from which the director derives an improper personal benefit.	
The principal effect of the limitation on liability provision is that a stockholder will be unable to prosecute an action for monetary damages against a director unless the stockholder can demonstrate a basis for liability for which indemnification is not available under the DGCL. These provisions, however, should not limit or eliminate our rights or any stockholder’s rights to seek non-monetary relief, such as an injunction or rescission, in the event of a breach of director’s fiduciary duty. These provisions will not alter a director’s liability under federal securities laws. The inclusion of this provision in our amended and restated certificate of incorporation may discourage or deter stockholders or management from bringing a lawsuit against directors for a breach of their fiduciary duties, even though such an action, if successful, might otherwise have benefited us and our stockholders.
Our amended and restated certificate of incorporation will require us to indemnify and advance expenses to our directors and officers to the fullest extent not prohibited by the DGCL and other applicable law. Our amended and restated certificate of incorporation will provide that we are required to indemnify our directors and executive officers, to the fullest extent permitted by law, against all liability and loss suffered and expenses (including attorney’s fees) incurred in connection with pending or threatened legal proceedings because of the director’s or officer’s positions with us or another entity that the director or officer serves at our request, subject to various conditions, and to pay the expenses (including attorney’s fees) actually and reasonably incurred by our directors and officers in advance of the final disposition to enable them to defend against such proceedings.
Transfer Agent and Registrar
The transfer agent and registrar for Tribune Publishing common stock is Computershare Investor Services. The contact information for the transfer agent and registrar is:
Computershare Investor Services
P.O. Box 30170
College Station, TX 77842-3170
(888) 359-8621
 
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 WHERE YOU CAN FIND MORE INFORMATION
Tribune Publishing has filed a registration statement on Form 10 with the SEC with respect to the shares of its common stock being distributed as contemplated by this information statement. This information statement is a part of, and does not contain all of the information set forth in, the registration statement and the exhibits to the registration statement. For further information with respect to Tribune Publishing and its common stock, please refer to the registration statement, including its exhibits. Statements made in this information statement relating to any contract or other document are not necessarily complete, and you should refer to the exhibits attached to the registration statement for copies of the actual contract or document. You may review a copy of the registration statement, including its exhibits, at the SEC’s public reference room, located at 100 F Street, N.E., Washington, D.C. 20549, as well as on the Internet at the SEC’s website at www.sec.gov. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Information contained on any website referenced in this information statement is not incorporated by reference into this information statement or the registration statement of which this information statement is a part.
Upon effectiveness of this registration statement, Tribune Publishing will become subject to the information and reporting requirements of the Exchange Act and, in accordance with the Exchange Act, will file periodic reports, proxy statements and other information with the SEC. Our future filings will be available from the SEC as described above.
Tribune Publishing will make its SEC filings available free of charge through our website (www.tribunepublishingco.com) as soon as practicable after they are electronically filed with the SEC. After the distribution, you may also request a copy of Tribune Publishing’s future SEC filings at no cost, by writing or telephoning us at:
Tribune Publishing Company
435 North Michigan Avenue
Chicago, Illinois 60611
Attn: Corporate Secretary
312-222-9100
We intend to furnish holders of our common stock with annual reports containing financial statements prepared in accordance with U.S. GAAP and audited and reported on, with an opinion expressed, by an independent registered public accounting firm.
You should rely only on the information contained in this information statement. We have not authorized any person to provide you with different information or to make any representation not contained in this information statement.
 
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 INDEX TO FINANCIAL STATEMENTS

 	  	PAGE	 	
Unaudited Interim Combined Financial Statements:	  				
		
Combined Statements of Comprehensive Income for the three months ended Mar. 30, 2014 (Successor), the three months ended Mar. 31, 2013 (Successor) and for Dec. 31, 2012 (Predecessor)	  	 	F-2	  	
		
Combined Balance Sheets at Mar. 30, 2014 (Successor) and Dec. 29, 2013 (Successor)	  	 	F-3	  	
		
Combined Statements of Equity for the three months ended Mar. 30, 2014 (Successor)	  	 	F-4	  	
		
Combined Statements of Cash Flows for the three months ended Mar. 30, 2014 (Successor), the three months ended Mar. 31, 2013 (Successor) and for Dec. 31, 2012 (Predecessor)	  	 	F-5	  	
		
Notes to the Combined Financial Statements	  	 	F-6	  	
		
Audited Annual Combined Financial Statements:	  				
		
Report of Independent Registered Public Accounting Firm	  	 	F-26	  	
		
Combined Statements of Comprehensive Income for the year ended Dec. 29, 2013 (Successor) and for Dec. 31, 2012 and for each of the two years in the period ended Dec. 30, 2012 (Predecessor)	  	 	F-28	  	
		
Combined Balance Sheets at Dec. 29, 2013 (Successor) and Dec. 30, 2012 (Predecessor )	  	 	F-29	  	
		
Combined Statements of Equity (Deficit) for the year ended Dec. 29, 2013 (Successor) and for Dec. 31, 2012 and for each of the two years in the period ended Dec. 30, 2012 (Predecessor )	  	 	F-30	  	
		
Combined Statements of Cash Flows for the year ended Dec. 29, 2013 (Successor) and for Dec. 31, 2012 and for each of the two years in the period ended Dec. 30, 2012 (Predecessor)	  	 	F-31	  	
		
Notes to the Combined Financial Statements	  	 	F-32	  	
 
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 TRIBUNE PUBLISHING COMPANY
COMBINED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
(Unaudited)

 	  	Successor	 	 	   	  	Predecessor	 	
 	  	Three Months Ended	 	 	   	  	 	 	
 	  	Mar. 30, 2014	 	 	Mar. 31, 2013	 	 	   	  	Dec. 31, 2012	 	
Operating Revenues	  				 				 	 	  				
Advertising	  	$	233,035	  	 	$	251,979	  	 	 	  	$	—	  	
Circulation	  	 	107,307	  	 	 	107,114	  	 	 	  	 	—	  	
Other	  	 	76,180	  	 	 	81,420	  	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total operating revenues	  	 	416,522	  	 	 	440,513	  	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Operating Expenses	  				 				 	 	  				
Cost of sales (exclusive of items shown below)	  	 	247,523	  	 	 	259,948	  	 	 	  	 	—	  	
Selling, general and administrative	  	 	143,882	  	 	 	135,952	  	 	 	  	 	—	  	
Depreciation	  	 	2,740	  	 	 	5,276	  	 	 	  	 	—	  	
Amortization	  	 	1,606	  	 	 	1,684	  	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total operating expenses	  	 	395,751	  	 	 	402,860	  	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Operating Profit	  	 	20,771	  	 	 	37,653	  	 	 	  	 	—	  	
Loss on equity investments, net	  	 	(335	) 	 	 	(351	) 	 	 	  	 	—	  	
Interest income (expense), net	  	 	(2	) 	 	 	13	  	 	 	  	 	—	  	
Reorganization items, net	  	 	(9	) 	 	 	58	  	 	 	  	 	2,754,553	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Income Before Income Taxes	  	 	20,425	  	 	 	37,373	  	 	 	  	 	2,754,553	  	
Income tax expense (benefit)	  	 	8,653	  	 	 	16,180	  	 	 	  	 	(87,773	) 	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Net Income	  	$	11,772	  	 	$	21,193	  	 	 	  	$	2,842,326	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Other Comprehensive Loss, Net of Taxes	  				 				 	 	  				
Unrecognized benefit plan gains and losses:	  				 				 	 	  				
Fresh-start reporting adjustment included in net income to eliminate Predecessor’s accumulated other comprehensive income, net of taxes of $6,440	  	 	—	  	 	 	—	  	 	 	  	 	(27,158	) 	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Other Comprehensive Loss, Net of Taxes	  	 	—	  	 	 	—	  	 	 	  	 	(27,158	) 	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Comprehensive Income	  	$	11,772	  	 	$	21,193	  	 	 	  	$	2,815,168	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
The accompanying notes are an integral part of these unaudited combined financial statements.
 
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Table of Contents
 TRIBUNE PUBLISHING COMPANY
COMBINED BALANCE SHEETS
(In thousands)
(Unaudited)

 	  	Mar. 30, 2014	 	 	Dec. 29, 2013	 	
Assets	  				 				
Current Assets	  				 				
Cash	  	$	8,540	  	 	$	9,694	  	
Accounts receivable (net of allowances of $12,096 and $12,856)	  	 	207,748	  	 	 	251,636	  	
Inventories	  	 	14,630	  	 	 	14,222	  	
Deferred income taxes	  	 	34,402	  	 	 	37,371	  	
Prepaid expenses and other	  	 	14,758	  	 	 	13,570	  	
	  	 	 	 	 	 	 	 	
Total current assets	  	 	280,078	  	 	 	326,493	  	
	  	 	 	 	 	 	 	 	
Properties	  				 				
Machinery, equipment and furniture	  	 	67,692	  	 	 	64,825	  	
Buildings and leasehold improvements	  	 	4,256	  	 	 	3,923	  	
	  	 	 	 	 	 	 	 	
	  	 	71,948	  	 	 	68,748	  	
Accumulated depreciation	  	 	(18,732	) 	 	 	(15,973	) 	
	  	 	 	 	 	 	 	 	
	  	 	53,216	  	 	 	52,775	  	
Construction in progress	  	 	13,236	  	 	 	15,153	  	
	  	 	 	 	 	 	 	 	
Net properties	  	 	66,452	  	 	 	67,928	  	
	  	 	 	 	 	 	 	 	
Other Assets	  				 				
Goodwill	  	 	16,064	  	 	 	15,331	  	
Intangible assets, net	  	 	59,210	  	 	 	60,482	  	
Investments	  	 	3,465	  	 	 	2,799	  	
Deferred income taxes	  	 	37,216	  	 	 	39,587	  	
Other	  	 	1,660	  	 	 	1,746	  	
	  	 	 	 	 	 	 	 	
Total other assets	  	 	117,615	  	 	 	119,945	  	
	  	 	 	 	 	 	 	 	
Total assets	  	$	464,145	  	 	$	514,366	  	
	  	 	 	 	 	 	 	 	
Liabilities and Equity	  				 				
Current Liabilities	  				 				
Accounts payable	  	$	37,287	  	 	$	36,329	  	
Employee compensation and benefits	  	 	91,062	  	 	 	103,351	  	
Deferred revenue	  	 	73,436	  	 	 	67,934	  	
Other	  	 	21,661	  	 	 	20,866	  	
	  	 	 	 	 	 	 	 	
Total current liabilities	  	 	223,446	  	 	 	228,480	  	
	  	 	 	 	 	 	 	 	
Non-Current Liabilities	  				 				
Deferred revenue	  	 	9,337	  	 	 	7,015	  	
Postretirement medical, life and other benefits	  	 	44,479	  	 	 	45,373	  	
Other obligations	  	 	5,951	  	 	 	8,673	  	
	  	 	 	 	 	 	 	 	
Total non-current liabilities	  	 	59,767	  	 	 	61,061	  	
Total Equity	  	 	180,932	  	 	 	224,825	  	
	  	 	 	 	 	 	 	 	
Total liabilities and equity	  	$	464,145	  	 	$	514,366	  	
	  	 	 	 	 	 	 	 	
The accompanying notes are an integral part of these unaudited combined financial statements.
 
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Table of Contents
 TRIBUNE PUBLISHING COMPANY
COMBINED STATEMENTS OF EQUITY
(In thousands)
(Unaudited)

 	  	Parent
Company
Investment	 	 	Accumulated
Other
Comprehensive
Loss	 	 	Total Equity	 	
Balance at Dec. 29, 2013	  	$	225,135	  	 	$	(310	) 	 	$	224,825	  	
Transactions with Tribune Company and Tribune Affiliates, net	  	 	(55,665	) 	 	 	—	  	 	 	(55,665	) 	
Net income	  	 	11,772	  	 	 	—	  	 	 	11,772	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Balance at Mar. 30, 2014	  	$	181,242	  	 	$	(310	) 	 	$	180,932	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
The accompanying notes are an integral part of these unaudited combined financial statements.
 
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Table of Contents
 TRIBUNE PUBLISHING COMPANY
COMBINED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

 	  	Successor	 	 	   	  	Predecessor	 	
 	  	Three Months Ended	 	 	   	  	 	 	
 	  	Mar. 30, 2014	 	 	Mar. 31, 2013	 	 	   	  	Dec. 31, 2012	 	
Operating Activities	  				 				 	 	  				
Net income	  	$	11,772	  	 	$	21,193	  	 	 	  	$	2,842,326	  	
Adjustments to reconcile net income to net cash provided by operating activities:	  				 				 	 	  				
Depreciation	  	 	2,740	  	 	 	5,276	  	 	 	  	 	—	  	
Amortization of intangible assets	  	 	1,606	  	 	 	1,684	  	 	 	  	 	—	  	
Amortization of contract intangible liabilities	  	 	(48	) 	 	 	(55	) 	 	 	  	 	—	  	
Loss on equity investments, net	  	 	335	  	 	 	351	  	 	 	  	 	—	  	
Non-cash reorganization items, net	  	 	—	  	 	 	(96	) 	 	 	  	 	(2,756,494	) 	
Changes in working capital items, excluding effects from acquisitions:	  				 				 	 	  				
Accounts receivable, net	  	 	43,888	  	 	 	45,224	  	 	 	  	 	—	  	
Inventories	  	 	(408	) 	 	 	(1,410	) 	 	 	  	 	—	  	
Prepaid expenses and other current assets	  	 	69	  	 	 	924	  	 	 	  	 	—	  	
Accounts payable, employee compensation and benefits, deferred revenue and other current liabilities	  	 	(6,403	) 	 	 	(15,902	) 	 	 	  	 	8,381	  	
Non-current deferred revenue	  	 	(479	) 	 	 	(1,335	) 	 	 	  	 	—	  	
Deferred income taxes	  	 	5,340	  	 	 	5,689	  	 	 	  	 	(94,213	) 	
Postretirement medical, life and other benefits	  	 	(894	) 	 	 	(633	) 	 	 	  	 	—	  	
Other, net	  	 	105	  	 	 	(2,141	) 	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Net cash provided by operating activities	  	 	57,623	  	 	 	58,769	  	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Investing Activities	  				 				 	 	  				
Capital expenditures	  	 	(1,112	) 	 	 	(6,155	) 	 	 	  	 	—	  	
Acquisitions and investments	  	 	(2,000	) 	 	 	(181	) 	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Net cash used for investing activities	  	 	(3,112	) 	 	 	(6,336	) 	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Financing Activities	  				 				 	 	  				
Repayments of capital lease obligations	  	 	—	  	 	 	(74	) 	 	 	  	 	—	  	
Transactions with Tribune Company and Tribune Affiliates, net	  	 	(55,665	) 	 	 	(53,467	) 	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Net cash used for financing activities	  	 	(55,665	) 	 	 	(53,541	) 	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Net Decrease in Cash	  	 	(1,154	) 	 	 	(1,108	) 	 	 	  	 	—	  	
Cash, beginning of period	  	 	9,694	  	 	 	13,768	  	 	 	  	 	13,768	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Cash, end of period	  	$	8,540	  	 	$	12,660	  	 	 	  	$	13,768	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
The accompanying notes are an integral part of these unaudited combined financial statements.
 
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Table of Contents
 TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS
(unaudited)
NOTE 1: DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Business Operations —The accompanying unaudited combined financial statements include the accounts of Tribune Publishing Company (“Tribune Publishing”), a business representing the principal publishing operations of Tribune Company (“Tribune”), as described below. Tribune Publishing’s operations are comprised of the direct and indirect subsidiaries of Tribune Publishing Company, LLC (“TPC”), a wholly-owned subsidiary of Tribune, and certain other assets of Tribune and its non-Tribune Publishing subsidiaries (“Tribune Affiliates”) as further described below. TPC, formerly known as Tribune Publishing Company, was converted into a limited liability company in connection with the restructuring transactions described below. In addition, certain direct and indirect subsidiaries were formed or became owned by TPC as a result of these restructuring transactions.
Tribune Publishing’s operations consist of eight major-market daily newspapers and related businesses, distribution of preprinted insert advertisements, commercial printing and delivery services to other newspapers, distribution of syndicated content and management of the websites of Tribune’s daily newspapers, along with other branded products that target specific areas of interest. The daily newspapers published by Tribune Publishing are the Los Angeles Times ; the Chicago Tribune ; the Sun Sentinel ; the Orlando Sentinel ; The Baltimore Sun ; the Hartford Courant ; The Morning Call , serving Pennsylvania’s Lehigh Valley; and the Daily Press , serving the Virginia Peninsula. Tribune Publishing’s operations also include Blue Lynx Media, LLC (“BLM”) which operates a shared service center for the benefit of Tribune and its subsidiaries, including the subsidiaries of Tribune Publishing; a 50% equity interest in CIPS Marketing Group, Inc. (“CIPS”); a 50% equity interest in McClatchy/Tribune Information Services (“MCT”); a 33% equity interest in Homefinder.com, LLC (“Homefinder”); and a 35% equity interest in Locality Labs, LLC (“Locality Labs”), which Tribune will retain following the expected separation of Tribune Publishing from Tribune (see “Separation from Tribune Company and Basis of Presentation” discussion below).
Separation from Tribune Company and Basis of Presentation —On July 10, 2013, Tribune announced its plan to spin-off essentially all of its publishing businesses into an independent company, Tribune Publishing. Tribune expects the transaction to be in the form of a pro rata distribution of substantially all of the common stock of Tribune Publishing to holders of Tribune common stock and warrants and anticipates that the distribution will be tax-free to Tribune’s U.S. shareholders.
Tribune Publishing’s operations are conducted through the following wholly-owned subsidiaries (including each subsidiary’s respective direct wholly-owned subsidiaries) of TPC: The Morning Call, LLC; Chicago Tribune Company, LLC; The Baltimore Sun Company, LLC; Orlando Sentinel Communications Company, LLC; Los Angeles Times Communications LLC; The Daily Press, LLC; The Hartford Courant Company, LLC; Sun-Sentinel Company, LLC; Tribune Washington Bureau, LLC; Hoy Publications, LLC; Tribune Interactive, LLC; Tribune 365, LLC; Tribune Content Agency, LLC; forsalebyowner.com, LLC; Builder Media Solutions, LLC; and BLM. Historically, separate financial statements have not been prepared for Tribune Publishing. The accompanying combined financial statements are derived from the historical accounting records of Tribune and present Tribune Publishing’s combined financial position, results of operations and cash flows as of and for the periods presented as if Tribune Publishing was a separate entity and as it was historically managed. Management believes that assumptions and methodologies underlying the allocation of general corporate expenses are reasonable. However, such expenses may not be indicative of the actual level of expense that would have been incurred had Tribune Publishing operated as a separate stand-alone entity, and, accordingly, may not necessarily reflect Tribune Publishing’s combined financial position, results of operations and cash flows had Tribune Publishing operated as a stand-alone entity during the periods presented.
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
These combined financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain assets of Tribune and Tribune Affiliates that are not owned by TPC and are otherwise specifically identifiable or attributable to Tribune Publishing and are necessary to present these combined financial results on a stand-alone basis have also been included in these combined financial statements.
Tribune and Tribune Affiliates consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan (as defined and described in Note 2). These restructuring transactions included, among other things, establishing a number of real estate holding companies. On Dec. 21, 2012, the majority of the land and buildings owned by Tribune Publishing were transferred to Tribune’s newly established real estate holding companies.
In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back certain land and buildings that were transferred. Although the properties subject to related party leases were legally transferred to the holding companies, Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing involvement with the properties, which pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification™ (“ASC”) Topic 840, “Leases,” preclude Tribune Publishing from derecognizing those properties from its combined financial statements. As a result, Tribune Publishing continued to account for and depreciate the carrying values of the transferred properties subject to related party leases which are presented within net properties in its combined balance sheet. Rent payments under the related party leases were accounted for as dividends to Tribune and Tribune Affiliates. See Note 4 for further information.
On Dec. 1, 2013, Tribune Publishing modified the specific provisions within the related party leases to address the prohibited forms of continuing involvement. This resulted in Tribune Publishing derecognizing those properties by recording a $337.6 million reduction to net properties and a corresponding reduction to the net parent company investment component of equity (deficit) in its combined balance sheet. The related party leases subsequent to the lease modification on Dec. 1, 2013 have been accounted for as operating leases.
The remainder of the transferred properties are no longer utilized in the operations of Tribune Publishing; therefore, Tribune Publishing did not enter into related party leases for those properties. Tribune Publishing entered into management agreements with the real estate holding companies pursuant to which it will manage those properties for an initial term of one year, cancelable by the real estate holding companies with a 30-day notice.
In connection with the spin-off, Tribune Publishing may enter into various agreements with Tribune and other third parties that may be on different terms than the terms of the arrangements or agreements that existed prior to the spin-off. For instance, Tribune Publishing utilizes the services of Tribune and Tribune Affiliates for certain functions such as legal, finance, human resource and information technology services, as well as various corporate-wide employee benefit programs. The costs of Tribune services that are specifically identifiable to Tribune Publishing are included in these combined financial statements. The costs of Tribune services that are incurred by Tribune but are not specifically identifiable to Tribune Publishing have been allocated to Tribune Publishing and included in these combined financial statements on basis that management considered to be a reasonable reflection of the utilization of services provided or the benefit received by Tribune Publishing during the periods presented. While management considers these allocations to have been made on a reasonable basis, the allocations do not necessarily reflect the expenses that would have been incurred had Tribune Publishing operated as a stand-alone entity. All such costs and expenses are assumed to be settled with Tribune through the parent company investment component of equity (deficit) in the period in which the costs were incurred. Current
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
income taxes are also assumed to be settled with Tribune through the parent company investment in the period the related income taxes were recorded.
All intercompany accounts within Tribune Publishing have been eliminated in consolidation. All significant intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates have been included within the combined financial statements and are considered to be effectively settled through equity contributions or distributions or through cash payments at the time the transactions were recorded. The accumulated net effect of intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates are included in the parent company investment component of Tribune Publishing equity (deficit). These intercompany transactions are further described in Note 4. The total net effect of these intercompany transactions are reflected in the combined statements of cash flows as financing activities.
The accompanying unaudited combined financial statements and notes of Tribune Publishing have been prepared in accordance with U.S. GAAP. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited combined financial statements and accompanying notes. In the opinion of management, the financial statements contain all adjustments necessary to present fairly the financial position of Tribune Publishing as of Mar. 30, 2014, the results of operations and cash flows for the three months ended Mar. 30, 2014 and Mar. 31, 2013 and the results of the Predecessor’s operations and cash flows for Dec 31, 2012. Actual results could differ from these estimates. Results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. These unaudited combined financial statements should be read in conjunction with Tribune Publishing’s audited combined financial statements.
Tribune Publishing assesses its operating segments in accordance with ASC Topic 280, “Segment Reporting.” Tribune Publishing is managed by its chief operating decision maker, as defined by ASC Topic 280, as one business. Accordingly, the financial statements of Tribune Publishing are presented to reflect one reporting segment.
NOTE 2: PROCEEDINGS UNDER CHAPTER 11
Chapter 11 Reorganization —On Dec. 8, 2008 (the “Petition Date”), Tribune, and 110 of its direct and indirect wholly-owned subsidiaries (each a “Debtor” and, collectively, the “Debtors”), filed voluntary petitions for relief (collectively, the “Chapter 11 Petitions”) under Chapter 11 (“Chapter 11”) of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Debtors’ Chapter 11 proceedings continue to be jointly administered under the caption “ In re: Tribune Company, et al. ,” Case No. 08-13141. Certain of the legal entities included in the combined financial statements of Tribune Publishing were Debtors or, as a result of the restructuring transactions described below, are successor legal entities to legal entities that were Debtors (collectively, the “Tribune Publishing Debtors”). References to the Debtors herein include the Tribune Publishing Debtors unless otherwise indicated. Other legal entities included in the accompanying combined financial statements of Tribune Publishing did not file petitions for relief under Chapter 11 of the Bankruptcy Code as of or subsequent to the Petition Date, and were, therefore, not Debtors, and are not successors to legal entities that were Debtors (each a “Non-Debtor Subsidiary” and, collectively, the “Non-Debtor Subsidiaries”) as of Dec. 31, 2012. For all periods presented herein, the Non-Debtor Subsidiaries included in the combined financial statements of Tribune Publishing are Tribune Interactive, LLC (as the successor legal entity to Tribune Interactive, Inc.); Riverwalk Center I Joint Venture; Tribune Hong Kong Limited, a foreign subsidiary; BLM; and Local Pro Plus Realty, LLC, a legal entity established subsequent to the Petition Date.
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
As further described below, a joint plan of reorganization for the Debtors, including the Tribune Publishing Debtors became effective and the Debtors emerged from Chapter 11 on Dec. 31, 2012 (the “Effective Date”). Where appropriate, Tribune Publishing and its business operations as conducted on or after Dec. 31, 2012 are herein referred to as “Reorganized Tribune Publishing”, “Reorganized Tribune Publishing Debtors,” “Successor Tribune Publishing” or “Successor.” Tribune and its business operations conducted on or after Dec. 31, 2012 are herein referred to as “Reorganized Tribune Company” and such references include Reorganized Tribune Publishing and Reorganized Tribune Publishing Debtors unless otherwise indicated. Where appropriate, Tribune Publishing and its business operations as conducted on or prior to Dec. 30, 2012 are herein referred to as “Predecessor Tribune Publishing” or “Predecessor.”
From the Petition Date and until the Effective Date, the Debtors operated their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and applicable orders of the Bankruptcy Court. In general, as debtors-in-possession, the Debtors were authorized under Chapter 11 of the Bankruptcy Code to continue to operate as ongoing businesses, but could not engage in transactions outside the ordinary course of business without the prior approval of the Bankruptcy Court.
Plan of Reorganization —In order for a debtor to emerge from Chapter 11, a Chapter 11 plan of reorganization that satisfies the requirements of the Bankruptcy Code and provides for emergence from bankruptcy must be proposed and confirmed by a bankruptcy court. A plan of reorganization addresses, among other things, prepetition obligations, sets forth the revised capital structure of the newly-reorganized entities and provides for their corporate governance subsequent to emergence from court supervision under Chapter 11. The disclosures below relate to the joint plan of reorganization for the Debtors and not to any individual plan of reorganization for the Tribune Publishing Debtors unless otherwise indicated.
On April 12, 2012, the Debtors, the official committee of unsecured creditors (the “Creditors’ Committee”), Oaktree Capital Management, L.P. (“Oaktree”), a creditor under certain Tribune prepetition debt facilities, Angelo, Gordon & Co. L.P. (“AG”), a creditor under certain Tribune prepetition debt facilities, and JPMorgan Chase Bank, N.A. (“JPMorgan”), an administrative agent and a creditor under certain Tribune prepetition debt facilities (collectively, the “Plan Proponents”) filed the Fourth Amended Joint Plan of Reorganization for Tribune Company and Its Subsidiaries (as subsequently amended and modified, the “Plan”) with the Bankruptcy Court.
The Plan was the product of extensive negotiations and contested proceedings before the Bankruptcy Court due, in part, to certain claims and causes of action related to a series of transactions, collectively referred to as the “Leveraged ESOP Transactions,” that were undertaken by Tribune in 2007. These transactions resulted in Tribune becoming wholly-owned by an employee stock ownership plan (the “ESOP”) on Dec. 20, 2007. At the Debtors’ request, on Sept. 1, 2010, the Bankruptcy Court appointed a mediator to conduct a non-binding mediation concerning the terms of a plan of reorganization, including the appropriate resolution of claims and causes of action related to the Leveraged ESOP Transactions (the “Mediation”). The Mediation began on Sept. 26, 2010 and ultimately resulted in a settlement agreement (the “Settlement Agreement”) between the Debtors, the Creditors’ Committee, AG, Oaktree, JPMorgan and a group of funds and managed accounts represented by King Street Acquisition Company, LLC, King Street Capital, LP and Marathon Asset Management, LP that were lenders under certain Tribune prepetition debt facilities. The Settlement Agreement provided for the settlement of certain causes of action arising in connection with the Leveraged ESOP Transactions, other than certain causes of action predefined as preserved. The terms of the Settlement Agreement, with certain modifications, were incorporated into the Plan filed with the Bankruptcy Court on April 12, 2012.
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
On July 23, 2012, the Bankruptcy Court issued an order (the “Confirmation Order”) confirming the Plan. The Plan constitutes a separate plan of reorganization for each of the Debtors and sets forth the terms and conditions of the Debtors’ reorganization. See “Terms of the Plan” section below for a description of the terms and conditions of the confirmed Plan as the Plan pertains to the Tribune Publishing Debtors.
Notices of appeal of the Confirmation Order were filed in August 2012 by certain Tribune creditors. The confirmation appeals have been transmitted to the United States District Court for the District of Delaware (“Delaware District Court”) and have been consolidated, together with two previously-filed appeals of the Bankruptcy Court’s orders relating to certain provisions in the Plan.
The appellants seek, among other relief, to overturn the Confirmation Order and certain prior orders of the Bankruptcy Court, including the settlement of certain claims and causes of action related to the Leveraged ESOP Transactions contained in the Plan. There is currently no stay of the Confirmation Order in place pending resolution of the confirmation-related appeals and those appeals remain pending before the Delaware District Court. In January 2013, Reorganized Tribune Company filed a motion to dismiss the appeals as equitably moot, based on the substantial consummation of the Plan. That request has been fully briefed by the parties and the motion remains pending.
As described in Note 1, during the fourth quarter of 2012 and prior to the Effective Date, Tribune and its subsidiaries consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan. These restructuring transactions included, among other things, (i) converting certain of Tribune’s subsidiaries into limited liability companies or merging certain of Tribune’s subsidiaries into newly-formed limited liability companies, (ii) consolidating and reallocating certain operations, entities, assets and liabilities within the organizational structure of Tribune and (iii) establishing a number of real estate holding companies. Among other things, the restructuring transactions resulted in TPC being converted into a limited liability company (prior to the conversion, TPC was a corporation named Tribune Publishing Company) as well as becoming the holding company for the principal direct and indirect subsidiaries that own and operate the business of Tribune Publishing as described in Note 1.
On the Effective Date, all of the conditions precedent to the effectiveness of the Plan were satisfied or waived, the Debtors emerged from Chapter 11, and the settlements, agreements and transactions contemplated by the Plan to be effected on the Effective Date were implemented, including, among other things, the appointment of a new board of directors of Tribune and the initiation of distributions to creditors. As a result, the ownership of Tribune changed from the ESOP to certain of Tribune’s creditors on the Effective Date. In connection with the Debtors’ emergence from Chapter 11, on the Effective Date and in accordance with and subject to the terms of the Plan, (i) all of Tribune’s $0.01 par value common stock held by the ESOP was cancelled and (ii) new shares of Reorganized Tribune Company were issued to shareholders who did not meet the necessary criteria to qualify as a subchapter S corporation shareholder. As a result, Reorganized Tribune Company converted from a subchapter S corporation to a C corporation under the Internal Revenue Code (“IRC”). This conversion also affected Tribune subsidiaries that were treated as qualified subchapter S subsidiaries, including certain legal entities included in the accompanying combined financial statements of Tribune Publishing. See Note 9 for further information In addition, Tribune’s direct and indirect ownership interests in the Tribune Publishing Debtors and Non-Debtor Subsidiaries, after giving effect to the restructuring transactions, were reinstated on the Effective Date.
Terms of the Plan —The following is a summary of the material settlements and other agreements entered into, distributions made and transactions consummated by Reorganized Tribune Publishing on or about the Effective Date pursuant to, and in accordance with, the terms of the Plan. The following summary only
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
highlights certain of the substantive provisions of the Plan as it relates to Reorganized Tribune Publishing and is not intended to be a complete description of, or a substitute for a full and complete reading of, the Plan and the agreements and other documents related thereto, including those described below.
 
 	—  	 	Cancellation of certain prepetition obligations: On the Effective Date, the Tribune Publishing Debtors’ prepetition debt and certain other obligations were cancelled, terminated and/or extinguished, including (i) cancellation of the $2.8 billion promissory demand notes due to Tribune Finance LLC (“Tribune Finance”), a subsidiary of Tribune, and (ii) the cancellation of guarantee obligations by certain Tribune Publishing Debtors under certain of Tribune’s prepetition credit facilities (other than for purposes of allowing creditors thereunder to receive distributions under the Plan and allowing the administrative agent for such facilities to exercise certain limited rights).	
 
 	—  	 	Assumption of prepetition executory contracts and unexpired leases : On the Effective Date, any prepetition executory contracts or unexpired leases of the Tribune Publishing Debtors that were not previously assumed or rejected pursuant to Section 365 of the Bankruptcy Code or rejected pursuant to the Plan were deemed assumed by the applicable Reorganized Tribune Publishing Debtors or their successors-in-interest.	
 
 	—  	 	Distributions to Tribune Creditors : On the Effective Date (or as soon as practicable thereafter), (i) holders of allowed senior loan claims against Tribune and allowed senior loan guarantee claims against the subsidiary guarantors received approximately $2.9 billion in cash, approximately 98.2 million shares of Class A and Class B common stock in Reorganized Tribune Company (“New Common Stock”) and warrants to purchase New Common Stock (“New Warrants”) with an aggregate fair value determined pursuant to the Plan of approximately $4.5 billion as of the Effective Date, plus interests in a litigation trust formed pursuant to the Plan (the “Litigation Trust”), (ii) holders of allowed claims against Tribune related to Tribune’s prepetition $1.6 billion twelve-month bridge loan facility and allowed bridge loan facility guarantee claims against the subsidiary guarantors received a pro rata share of $64.5 million in cash (equal to approximately 3.98% of their allowed claim) plus interests in the Litigation Trust, (iii) holders of allowed general unsecured claims against the Tribune Publishing Debtors received cash in an amount equal to 100% of their allowed claim, and (iv) holders of unclassified claims, priority non-tax claims and certain other secured claims received cash in an amount equal to 100% of their allowed claim. All allowed priority tax and non-tax claims and other secured claims not paid on the Effective Date were reinstated and allowed administrative expense claims will be paid in full when due. All distributions to creditors related to the Tribune Publishing Debtors’ prepetition liabilities classified as liabilities subject to compromise were made by Tribune on behalf of the Tribune Publishing Debtors pursuant to Tribune’s centralized cash management system as described in Note 4.	
 
 	—  	 	Ownership Interests in the Tribune Publishing Debtors and Non-Debtor Subsidiaries : All ownership interests of Tribune in the Tribune Publishing Debtors and Non-Debtor Subsidiaries, after giving effect to the restructuring transactions described earlier, were reinstated on the Effective Date.	
 
 	—  	 	Other Plan provisions : The Plan and Confirmation Order also contain various discharges, injunctive provisions and releases that became operative on the Effective Date.	
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
Since the Effective Date, Reorganized Tribune Company has substantially consummated the various transactions contemplated under the Plan, including those provisions relating to the Tribune Publishing Debtors. In particular, Reorganized Tribune Company made all distributions of cash, including cash distributions made on behalf of the Tribune Publishing Debtors, New Common Stock and New Warrants that were required to be made under the terms of the Plan to creditors holding allowed claims. The prepetition claims of the Tribune Publishing Debtors’ general unsecured creditors that became or become allowed subsequent to the Effective Date have been or will be paid on the next quarterly distribution date after such allowance.
Resolution of Outstanding Prepetition Claims —Under Section 362 of the Bankruptcy Code, the filing of a bankruptcy petition automatically stays most actions against a debtor, including most actions to collect prepetition indebtedness or to exercise control over the property of the debtor’s estate. Absent an order of the Bankruptcy Court, substantially all prepetition liabilities are subject to settlement under a plan of reorganization approved by the Bankruptcy Court. Shortly after commencing their Chapter 11 proceedings, the Debtors began notifying all known current or potential creditors of the Chapter 11 filings.
On March 23, 2009, the Tribune Publishing Debtors filed schedules with the Bankruptcy Court setting forth the assets and liabilities of the Tribune Publishing Debtors as of the Petition Date (as subsequently amended from time to time, the “Schedules of Assets and Liabilities”). These Schedules of Assets and Liabilities contain information identifying the Tribune Publishing Debtors’ executory contracts and unexpired leases, the creditors that may hold claims against the Tribune Publishing Debtors and the nature of such claims. On March 25, 2009, the Bankruptcy Court set June 12, 2009 as the general bar date, which was the final date by which most entities that wished to assert a prepetition claim against the Tribune Publishing Debtors were required to file a proof of claim in writing.
Pursuant to the terms of the Plan and subject to certain specified exceptions, on the Effective Date, all executory contracts or unexpired leases of the Tribune Publishing Debtors were deemed assumed in accordance with, and subject to, the provisions and requirements of Section 365 and 1123 of the Bankruptcy Code. However, certain executory contracts and leases were previously assumed or rejected pursuant to Section 365 of the Bankruptcy Code.
On the Effective Date, substantially all of the Debtors’ prepetition liabilities at Dec. 30, 2012 were settled or otherwise satisfied under the Plan. However, certain other claims have been or will be settled or otherwise satisfied subsequent to the Effective Date. Although the allowed amount of certain unresolved claims has not been determined, Tribune Publishing’s liabilities subject to compromise associated with these unresolved claims were discharged upon emergence from Chapter 11 in exchange for the treatment outlined in the Plan. For information regarding the discharge of liabilities subject to compromise, see the “Terms of the Plan” section above.
Reorganization Items, Net —Reorganization items, net generally includes provisions and adjustments to reflect the carrying value of certain prepetition liabilities at their estimated allowable claim amounts and, pursuant to ASC Topic 852, “Reorganizations,” is reported separately in Tribune Publishing’s combined statements of comprehensive income. Reorganization items, net may also include professional advisory fees and other costs directly associated with the Debtors’ Chapter 11 cases, however, all professional advisory fees that were paid by Tribune and other non-debtor Tribune Affiliates that related to all Debtors have not been allocated to Tribune Publishing as professional advisory fees are Tribune reorganization expenses and do not specifically relate to the operations of Tribune Publishing.
Specifically identifiable reorganization provisions, adjustments and other costs directly related to Tribune Publishing have been included in the Successor’s combined statement of comprehensive income for the
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
three months ended Mar. 30, 2014 and Mar. 31, 2013 and in the Predecessor’s combined statements of comprehensive income for Dec. 31, 2012 consisted of the following (in thousands):

 	  	Successor	 	 	   	  	Predecessor	 	
 	  	Three Months Ended	 	 	   	  	 	 	
 	  	Mar. 30, 2014	 	 	Mar. 31, 2013	 	 	   	  	Dec. 31, 2012	 	
Reorganization costs, net:	  				 				 	 	  				
Contract rejections and claim settlements	  	$	(7	) 	 	$	111	  	 	 	  	$	—	  	
Other, net	  	 	(2	) 	 	 	(53	) 	 	 	  	 	—	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total reorganization costs, net	  	 	(9	) 	 	 	58	  	 	 	  	 	—	  	
Reorganization adjustments, net	  	 	—	  	 	 	—	  	 	 	  	 	2,862,039	  	
Fresh-start reporting adjustments, net	  	 	—	  	 	 	—	  	 	 	  	 	(107,486	) 	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total reorganization items, net	  	$	(9	) 	 	$	58	  	 	 	  	$	2,754,553	  	
	  	 	 	 	 	 	 	 	 	 	  	 	 	 	
The Predecessor’s audited combined statement of comprehensive income for Dec. 31, 2012 included other reorganization items totaling $2.755 billion before taxes ($2.842 billion after taxes) arising from reorganization and fresh-start reporting adjustments. Reorganization adjustments, which were recorded to reflect the settlement of prepetition liabilities and changes in the Predecessor’s capital structure arising from the implementation of the Plan, resulted in a net reorganization gain of $2.862 billion before taxes ($2.894 billion after taxes). Fresh-start reporting adjustments, which were recorded as a result of the adoption of fresh-start reporting as of the Effective Date in accordance with ASC Topic 852, resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). The net gain resulted primarily from adjusting the Predecessor’s net carrying values for certain assets and liabilities to their fair values in accordance with ASC Topic 805, “Business Combinations,” recording related adjustments to deferred income taxes and eliminating the Predecessor’s accumulated other comprehensive income (loss) as of the Effective Date.
Tribune Publishing expects to incur certain expenses pertaining to the Chapter 11 proceedings throughout 2014 and potentially in future periods. These expenses will include primarily other costs related to the implementation of the Plan and the resolution of unresolved claims.
Fresh-Start Reporting —Reorganized Tribune Company adopted fresh-start reporting on the Effective Date in accordance with ASC Topic 852. All conditions required for the adoption of fresh-start reporting were satisfied by Reorganized Tribune Company on the Effective Date as (i) the ESOP, the holder of all of Tribune’s voting shares immediately before confirmation of the Plan, did not receive any voting shares of Reorganized Tribune Company or any other distributions under the Plan, and (ii) the reorganization value of Tribune’s assets was less than the postpetition liabilities and allowed prepetition claims. As a result, Tribune Publishing also adopted fresh-start reporting on the Effective Date.
The adoption of fresh-start reporting by Reorganized Tribune Publishing resulted in a new reporting entity for financial reporting purposes reflecting the Successor’s capital structure as of the Effective Date. Any presentation of Reorganized Tribune Publishing’s combined financial statements as of and for periods subsequent to the Effective Date represents the financial position, results of operations and cash flows of a new reporting entity and will not be comparable to any presentation of the Predecessor’s combined financial statements as of and for periods prior to the Effective Date, and the adoption of fresh-start reporting.
In accordance with ASC Topic 852, the Predecessor’s audited combined statement of comprehensive income for Dec. 31, 2012 includes only (i) reorganization adjustments which resulted in a net gain of $2.862
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
billion before taxes ($2.894 billion after taxes) and (ii) fresh-start reporting adjustments which resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). These adjustments are further summarized and described below. The Predecessor’s audited combined statements of comprehensive income and cash flows for Dec. 31, 2012 exclude the results of operations and cash flows arising from the Predecessor’s business operations on Dec. 31, 2012. Because the Predecessor’s Dec. 31, 2012 results of operations and cash flows were not material, Reorganized Tribune Publishing has elected to report them as part of Reorganized Tribune Publishing’s results of operations and cash flows for the fiscal year ended Dec. 29, 2013.
Enterprise Value/Reorganization Value —ASC Topic 852 requires, among other things, a determination of the reorganization value for Reorganized Tribune Company and allocation of such reorganization value to the fair value of Reorganized Tribune Company’s tangible assets, finite-lived intangible assets and indefinite-lived intangible assets in accordance with the provisions of ASC Topic 805, “Business Combinations,” as of the Effective Date. The reorganization value for Reorganized Tribune Company represents the amount of resources available, or that become available, for the satisfaction of postpetition liabilities and allowed prepetition claims, as negotiated between the Debtors and their creditors. This value is viewed as the fair value of Reorganized Tribune Company before considering liabilities and is intended to approximate the amount a willing buyer would pay for the assets of Reorganized Tribune Company immediately after emergence from bankruptcy. In connection with the Debtors’ Chapter 11 cases, the Debtors’ financial advisor undertook a valuation analysis to determine the value available for distribution to holders of allowed prepetition claims. Based on current and anticipated economic conditions as of the Effective Date and the direct impact of these conditions on Reorganized Tribune Company’s business, this analysis estimated a range of distributable value from the Debtors’ estates from $6.917 billion to $7.826 billion with an approximate mid-point of $7.372 billion. The confirmed Plan contemplates a distributable value for Reorganized Tribune Company of $7.372 billion. The distributable value implies an equity value for Reorganized Tribune Company of $4.536 billion after reducing the distributable value for cash distributed (or to be distributed) pursuant to the Plan and $1.100 billion of new debt undertaken by Reorganized Tribune Company.
In accordance with the provisions of ASC Topic 805, the reorganization value of Reorganized Tribune Company were allocated, in part, to the fair value of Reorganized Tribune Publishing’s tangible assets, finite-lived intangible assets, and indefinite-lived intangible assets as of the Effective Date.
Methodology, Analysis and Assumptions —The comparable company valuation analysis methodology estimates the enterprise value of a company based on a relative comparison with publicly traded companies with similar operating and financial characteristics to the subject company. Under this methodology, Tribune’s financial advisor determined a range of multiples of revenues and earnings before interest, taxes, depreciation and amortization (“EBITDA”) to calculate the enterprise values of Tribune’s publishing and broadcasting segments. The discounted cash flow (“DCF”) analysis is a forward-looking enterprise valuation methodology that estimates the value of an asset or business by calculating the expected future cash flows to be generated by that asset or business. Under this methodology, projected future cash flows are discounted by the enterprise’s weighted average cost of capital (“WACC”). The WACC reflects the estimated blended rate of return that would be required by debt and equity investors to invest in the enterprise based on its capital structure. Utilizing the DCF analysis, the enterprise values of Tribune’s publishing and broadcasting segments were determined by calculating the present value of the projected unlevered after-tax free cash flows through 2015 plus an estimate for the value of each segment for the period beyond 2015 known as the terminal value. The terminal value was derived by either applying a multiple to the projected EBITDA for the final year of the projection period (2015) or capitalizing the projected unlevered after-tax free cash flow in the same projection period using the WACC and an assumed perpetual growth rate, discounted back to the valuation date using the WACC, as appropriate. The precedent transactions valuation methodology is based on the enterprise values of companies
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
involved in public merger and acquisition transactions that have operating and financial characteristics similar to the subject company. Under this methodology, the enterprise value is determined by an analysis of the consideration paid and the debt assumed in the identified merger and acquisition transactions and is usually expressed as a multiple of revenues or EBITDA. Utilizing this analysis, Tribune’s financial advisor determined a range of multiples of EBITDA for the trailing 12 months from the measurement date to calculate the enterprise value for Tribune’s broadcasting segment. The precedent transactions valuation methodology was not used for Tribune’s publishing segment due to the lack of relevant transactions.
Tribune’s financial advisor applied a weighted average of the above enterprise valuation methodologies to calculate the estimated ranges of enterprise values for Tribune’s publishing and broadcasting segments. The relative weighting of each valuation methodology was based on the amount of publicly available information to determine the inputs used in the calculations. In addition, Tribune’s financial advisor utilized a combination of these enterprise valuation methodologies, primarily the comparable company valuation analysis methodology, to calculate the estimated ranges of fair values of Tribune’s equity investments. The ranges of enterprise values for Tribune’s publishing and broadcasting segments and estimated fair values of Tribune’s equity investments were added to the estimated cash on hand as of the measurement date to determine the estimated range of distributable value noted above.
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
Fresh-Start Combined Balance Sheet —The table below summarizes the Predecessor’s Dec. 30, 2012 combined balance sheet, the reorganization and fresh-start reporting adjustments that were made to that balance sheet as of Dec. 31, 2012, and the resulting Successor’s audited combined balance sheet as of Dec. 31, 2012.
Combined Balance Sheets at Dec. 30, 2012 and Dec. 31, 2012
(In thousands)

 	 	Predecessor
At Dec. 30, 2012	 	 	Reorganization
Adjustments	 	 	Fresh-Start
Adjustments	 	 	Successor
At Dec. 31, 2012	 	
Assets	 				 				 				 				
Current Assets	 				 				 				 				
Cash	 	$	13,768	  	 	$	—	  	 	$	—	  	 	$	13,768	  	
Accounts receivable, net	 	 	256,985	  	 	 	—	  	 	 	—	  	 	 	256,985	  	
Inventories	 	 	12,537	  	 	 	—	  	 	 	5,810	  (4)  	 	 	18,347	  	
Deferred income taxes	 	 	1,147	  	 	 	42,228	  (1)(2)  	 	 	(2,272	) (4)  	 	 	41,103	  	
Prepaid expenses and other	 	 	14,733	  	 	 	—	  	 	 	(18	) (4)  	 	 	14,715	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current assets	 	 	299,170	  	 	 	42,228	  	 	 	3,520	  	 	 	344,918	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Properties	 				 				 				 				
Property, plant and equipment	 	 	1,938,208	  	 	 	—	  	 	 	(1,527,106	) (4)  	 	 	411,102	  	
Accumulated depreciation	 	 	(1,322,830	) 	 	 	—	  	 	 	1,322,830	  (4)  	 	 	—	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net properties	 	 	615,378	  	 	 	—	  	 	 	(204,276	) 	 	 	411,102	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Assets	 				 				 				 				
Goodwill	 	 	—	  	 	 	—	  	 	 	15,331	  (4)  	 	 	15,331	  	
Other intangible assets, net	 	 	28,911	  	 	 	—	  	 	 	37,976	  (4)  	 	 	66,887	  	
Investments	 	 	3,986	  	 	 	—	  	 	 	—	  	 	 	3,986	  	
Deferred income taxes	 	 	—	  	 	 	—	  	 	 	54,188	  (4)  	 	 	54,188	  	
Other	 	 	3,787	  	 	 	—	  	 	 	(2,402	) (4)  	 	 	1,385	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total other assets	 	 	36,684	  	 	 	—	  	 	 	105,093	  	 	 	141,777	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total assets	 	$	951,232	  	 	$	42,228	  	 	$	(95,663	) 	 	$	897,797	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Liabilities and Shareholder’s Equity (Deficit)	 				 				 				 				
Current Liabilities	 				 				 				 				
Accounts payable	 	$	37,710	  	 	$	2,528	  (1)(3)  	 	$	—	  (4)  	 	$	40,238	  	
Employee compensation and benefits	 	 	103,077	  	 	 	322	  (1)(3)  	 	 	—	  	 	 	103,399	  	
Deferred revenue	 	 	66,835	  	 	 	—	  	 	 	(171	) (4)  	 	 	66,664	  	
Other current liabilities	 	 	26,359	  	 	 	(879	) (1)(3)  	 	 	—	  	 	 	25,480	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current liabilities	 	 	233,981	  	 	 	1,971	  	 	 	(171	) 	 	 	235,781	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Non-Current Liabilities	 	 	66,300	  	 	 	11,679	  (1)(2)(3)  	 	 	(16,192	) (4)  	 	 	61,787	  	
Liabilities Subject to Compromise	 	 	2,865,890	  	 	 	(2,865,890	) (1)(3)  	 	 	—	  	 	 	—	  	
Equity (Deficit)	 	 	(2,214,939	) 	 	 	2,894,468	  (1)  	 	 	(79,300	) (4)  	 	 	600,229	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total liabilities and equity (deficit)	 	$	951,232	  	 	$	42,228	  	 	$	(95,663	) 	 	$	897,797	  	

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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
 	(1)	Reflects adjustments arising from implementation of the Plan, including the gain on the settlement of prepetition liabilities, distributions of cash by Tribune on behalf of Reorganized Tribune Publishing and the elimination of Tribune Publishing’s equity (deficit). These adjustments also include the establishment of Reorganized Tribune Publishing’s equity based on the reorganization value of Reorganized Tribune Company allocated to the fair value of Reorganized Tribune Publishing’s tangible assets, finite-lived intangible assets and indefinite-lived intangible assets as of the Effective Date. The changes in the Predecessor’s capital structure arising from the implementation of the Plan are comprised of the following adjustments (in thousands):	

Liabilities subject to compromise on the Effective Date	  	$	2,865,890	  	
Less: Liabilities assumed and reinstated on the Effective Date	  	 	(2,909	) 	
Less: Liabilities for prepetition claims to be settled subsequent to the Effective Date and other adjustments	  	 	(5,472	) 	
	  	 	 	 	
Liabilities subject to compromise settled on the Effective Date	  	 	2,857,509	  	
Forgiveness of prepetition promissory notes held by parent	  	 	2,822,860	  	
Cash distributions on settled claims paid by parent	  	 	34,649	  	
	  	 	 	 	
Gain on settlement of liabilities subject to compromise	  	 	2,857,509	  	
Plus: Other reorganization adjustments, net	  	 	4,530	  	
	  	 	 	 	
Total reorganization adjustments before taxes	  	 	2,862,039	  	
Plus: Income tax benefit on reorganization adjustments	  	 	32,429	  	
	  	 	 	 	
Net reorganization gain after taxes	  	$	2,894,468	  	

 	(2)	Reflects the conversion of Reorganized Tribune Company, including its qualified subchapter S subsidiaries, from a subchapter S corporation to a C corporation under the IRC.	
 	(3)	Reflects the reclassification of certain liabilities from liabilities subject to compromise upon the assumption of certain executory contracts and unexpired leases.	
 	(4)	The Predecessor’s combined statement of comprehensive income for Dec. 31, 2012 includes certain adjustments recorded as a result of the adoption of fresh-start reporting in accordance with ASC Topic 852 as of the Effective Date. These fresh-start reporting adjustments resulted in a net pretax loss which primarily resulted from adjusting the Predecessor’s recorded values for certain assets and liabilities to fair values in accordance with ASC Topic 805, and recording related adjustments to deferred income taxes. The fresh-start reporting adjustments included in the Predecessor’s statement of comprehensive income for Dec. 31, 2012 consisted of the following items (in thousands):	

Fair value adjustments to net properties	  	$	(204,276	) 	
Fair value adjustments to intangibles	  	 	37,431	  	
Establish Successor’s goodwill	  	 	15,331	  	
Elimination of accumulated other comprehensive income	  	 	33,598	  	
Other fair value adjustments, net	  	 	10,430	  	
	  	 	 	 	
Loss from fresh-start reporting adjustments before taxes	  	 	(107,486	) 	
Income tax benefit attributable to fair value adjustments	  	 	55,344	  	
	  	 	 	 	
Net loss from fresh-start reporting adjustments after taxes	  	$	(52,142	) 	
	  	 	 	 	
Property, Plant and Equipment —Property, plant and equipment was adjusted to a fair value aggregating $411.1 million as of the Effective Date. The fair values of property, plant and equipment were based primarily on valuations obtained from third party valuation specialists principally utilizing the cost and market valuation approaches.
Fresh-start reporting adjustments included the elimination of the Predecessor’s aggregate accumulated depreciation balance as of Dec. 30, 2012.
Identifiable Intangible Assets —The following intangible assets were identified by Reorganized Tribune Publishing and recorded at fair value based on valuations obtained from third party valuation specialists: newspaper mastheads, advertiser relationships, customer relationships, affiliate agreements and other contracts and agreements, including real property leases. The cost, income and market valuation approaches were utilized, as appropriate, to estimate the fair values of these intangible assets. The determination of the fair values of these identifiable intangible assets resulted in a $38 million net increase in other intangible assets in the Successor’s combined balance sheet at Dec. 31, 2012.
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
NOTE 3: CHANGES IN OPERATIONS
Employee Reductions —Tribune Publishing identified reductions in staffing levels in its operations of approximately 25 and 65 positions in the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively. Tribune Publishing recorded pretax charges of $0.3 million and $2 million for the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively. A summary of the activity with respect to Tribune Publishing’s severance accrual for the three months ended Mar. 30, 2014 is as follows (in thousands):

Balance at Dec. 29, 2013	  	$	9,336	  	
Provision	  	 	348	  	
Payments	  	 	(4,308	) 	
	  	 	 	 	
Balance at Mar. 30, 2014	  	$	5,376	  	
	  	 	 	 	
Charges for severance and related expenses are included in selling, general and administrative expense in the accompanying combined statements of comprehensive income. The severance and related expenses above excludes severance and related expenses incurred by Tribune and Tribune Affiliates and allocated to Tribune Publishing. See Note 4 for further discussion of allocated charges from Tribune and Tribune Affiliates.
NOTE 4: RELATED PARTY TRANSACTIONS WITH TRIBUNE AND AFFILIATES
Tribune Publishing participates in a number of corporate-wide programs administered by Tribune and Tribune Affiliates. These include participation in Tribune’s centralized treasury function, insurance programs, employee benefit programs, workers’ compensation programs, and centralized service centers and other corporate functions. The following is a discussion of the relationship with Tribune, the services provided and how transactions with Tribune and Tribune Affiliates have been accounted for in the combined financial statements.
Equity —Equity in the combined balance sheets includes the accumulated balance of transactions between Tribune Publishing and Tribune and Tribune Affiliates, Tribune Publishing’s paid-in-capital, and Tribune’s interest in Tribune Publishing’s cumulative retained earnings, and are presented within parent company investment and combined with accumulated other comprehensive income to total equity (deficit). The amounts comprising the accumulated balance of transactions between Tribune Publishing and Tribune and Tribune Affiliates include (i) the cumulative net assets attributed to Tribune Publishing by Tribune and Tribune Affiliates, (ii) the cumulative net advances to Tribune representing the cumulative Tribune Publishing funds swept (net of funding provided by Tribune and Tribune Affiliates to Tribune Publishing) as part of the centralized cash management program described further below, (iii) the cumulative charges (net of credits) allocated by Tribune and Tribune Affiliates to Tribune Publishing for certain support services received by Tribune Publishing and (iv) related party dividends for rent payments on related party leases as described further below.
Centralized Cash Management —Tribune utilizes a centralized approach to cash management and the financing of its operations. Under this centralized cash management program, Tribune and Tribune Publishing advance funds to each other. Accordingly, none of Tribune’s cash and cash equivalents has been assigned to Tribune Publishing in the combined financial statements. Cash in the combined balance sheets represents either cash not yet advanced to Tribune or cash held locally by Tribune Publishing. These transactions are recorded in equity (deficit) when advanced.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
Support Services Provided and Other Amounts with Tribune and Tribune Affiliates —Tribune Publishing received allocated charges from Tribune and Tribune Affiliates for certain corporate support services, which are recorded within selling, general and administrative expense in Tribune Publishing’s combined statements of comprehensive income. Management believes that the basis used for the allocations are reasonable and reflect the portion of such costs attributed to Tribune Publishing’s operations; however, the amounts may not be representative of the costs necessary for Tribune Publishing to operate as a separate stand-alone company. These allocated costs are summarized in the following table (in thousands):

 	  	Three Months Ended	 	
 	  	Mar. 30, 2014	 	 	Mar. 31, 2013	 	
Corporate management fee	  	$	9,060	  	 	$	5,727	  	
Service center support costs	  	 	271	  	 	 	262	  	
Technology service center support costs	  	 	24,795	  	 	 	24,488	  	
General insurance	  	 	909	  	 	 	1,240	  	
Other support costs	  	 	254	  	 	 	459	  	
Cost recoveries	  	 	(130	) 	 	 	(112	) 	
	  	 	 	 	 	 	 	 	
Total	  	$	35,159	  	 	$	32,064	  	
	  	 	 	 	 	 	 	 	
Medical and Workers’ Compensation Benefit Plans —Tribune Publishing participates in Tribune-sponsored employee benefit plans, including medical and workers’ compensation. Allocations of benefit plan costs varied by plan type and were based on actuarial valuations of cost and/or liability, premium amounts and payroll. Total benefit plan costs allocated to Tribune Publishing amounted to $11.6 million and $12.1 million in the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively, and are recorded in cost of sales and selling, general and administrative expense, as appropriate, in the combined statements of comprehensive income. While management believes the cost allocation methods utilized for the benefit plans were reasonable and reflected the portion of such costs attributed to Tribune Publishing, the amounts may not be representative of the costs necessary for Tribune Publishing to operate as a stand-alone business.
Defined Benefit Plans —Retirement benefits obligations pursuant to the Tribune defined benefit pension plans have historically been and will continue to be an obligation of Tribune. Therefore, Tribune Publishing accounts for costs associated with these defined benefit pension plans as a participant in multi-employer plans in accordance with ASC Topic 715. Costs related to Tribune-sponsored pension plans, which totaled a credit of $5.4 million and $5.8 million in the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively, were based upon a specific allocation of actuarially determined service costs plus an allocation of the remaining net periodic pension cost components based upon the Company’s proportional share of the pension liability. Tribune-sponsored pension plan income allocated to Tribune Publishing is recorded in cost of sales and selling, general and administrative expense, as appropriate, in the combined statements of income and comprehensive income. While management believes the allocation methods utilized for the Tribune-sponsored pension plans were reasonable and reflected the portion of such income attributed to Tribune Publishing, the amounts may not be representative of the costs necessary for Tribune Publishing to operate as a stand-alone business.
Defined Contribution Plans —Tribune Publishing’s employees have historically participated in various Tribune qualified 401(k) savings plans, which permit eligible employees to make voluntary contributions on a pretax basis. The plans allow participants to invest their savings in various investments. Amounts charged to expense by Tribune Publishing for employer contributions to Tribune 401(k) savings plans totaled $3.4 million and $3.5 million for the three months ended Mar. 30, 2014 and Mar. 31, 2013, respectively, and are recorded in cost of sales and selling, general and administrative expense, as appropriate, in the combined statements of income and comprehensive income.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
Related Party Lease Agreements —As described in Note 1, on Dec. 21, 2012, the majority of the land and buildings owned by Tribune Publishing were transferred to Tribune’s newly established real estate holding companies. As of the date of the transfers, the carrying value of the transferred properties was $294.5 million.
On Nov. 15, 2013, Tribune Publishing transferred two additional properties to the real estate holding companies and subsequently leased back the properties from Tribune. The carrying value of the properties transferred on Nov. 15, 2013 was $18.0 million.
In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back certain land and buildings that were transferred on Dec. 21, 2012. The initial term of these non-cancellable related party lease agreements is either five or ten years, with two optional renewal terms. Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing involvement with the properties subject to related party leases, which, in accordance with ASC Topic 840, precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result, Tribune Publishing continued to account for and depreciate the carrying values of the transferred properties subject to related party leases and rent payments were accounted for as dividends to Tribune and Tribune Affiliates. Tribune Publishing recorded $1.3 million in depreciation expense for such properties during the three months ended Mar. 31, 2013.
On Dec. 1, 2013, Tribune Publishing modified the related party leases to eliminate certain protections provided to the landlord in the event of default by the tenant, including the right to collect rent and other balances owed by tenant under the leases utilizing insurance proceeds received by the landlord in the event of damage and otherwise payable to the tenant, as well as the right to collect rent directly from subtenants to the extent all or a portion of the premise is sublet. Pursuant to ASC Topic 840, these provisions had precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result of these modifications, Tribune Publishing determined that it no longer had forms of continuing involvement with the transferred properties and derecognized such properties from its combined financial statements by recording a $337.6 million reduction to net properties and a corresponding reduction to the parent company investment component of equity (deficit) in its combined balance sheet. Tribune Publishing has accounted for these related party leases as operating leases beginning on Dec. 1, 2013. In connection with all related party lease agreements, Tribune Publishing recognized $9.6 million of rent expense for the three months ended Mar. 30, 2014, recorded in cost of sales and selling, general and administrative expense, as appropriate.
The remainder of the transferred properties, which had a carrying value of $28.5 million as of the date of the transfers, are no longer utilized in the operations of Tribune Publishing; therefore, Tribune Publishing did not enter into related party leases for those properties. Tribune Publishing entered into management agreements with the real estate holding companies pursuant to which it will manage those properties for an initial term of one year, cancelable by the real estate holding companies with a 30-day notice.
In addition, in 2013, Tribune Publishing entered into various related party lease agreements with a Tribune real estate holding company to lease the portions of the shared Tribune corporate office space that Tribune Publishing continues to occupy for an initial 5-year term. In accordance with ASC Topic 840, Tribune Publishing has accounted for these related party leases as operating leases. Costs associated with the related party lease agreements for shared corporate office space were recorded in selling, general and administrative expense.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
NOTE 5: INVENTORIES
Inventories consisted of the following (in thousands):

 	  	Mar. 30, 2014	 	  	Dec. 29, 2013	 	
Newsprint	  	$	14,332	  	  	$	13,831	  	
Supplies and other	  	 	298	  	  	 	391	  	
	  	 	 	 	  	 	 	 	
Total inventories	  	$	14,630	  	  	$	14,222	  	
	  	 	 	 	  	 	 	 	
Inventories are stated at the lower of cost or market. Tribune Publishing determines cost on the first-in, first-out (“FIFO”) basis for all inventories.
NOTE 6: GOODWILL, OTHER INTANGIBLE ASSETS AND INTANGIBLE LIABILITIES
Goodwill, other intangible assets and intangible liabilities at Mar. 30, 2014 and Dec. 29, 2013 consisted of the following (in thousands):

 	 	Mar. 30, 2014	 	 	   	 	Dec. 29, 2013	 	
 	 	Gross
Amount	 	 	Accumulated
Amortization	 	 	Net
Amount	 	 	   	 	Gross
Amount	 	 	Accumulated
Amortization	 	 	Net
Amount	 	
Other intangible assets subject to amortization	 				 				 				 	 	 				 				 				
Subscribers (useful life of 2 to 10 years)	 	$	3,694	  	 	$	(1,148	) 	 	$	2,546	  	 	 	 	$	3,694	  	 	$	(919	) 	 	$	2,775	  	
Advertiser relationships (useful life of 2 to 13 years)	 	 	14,666	  	 	 	(2,545	) 	 	 	12,121	  	 	 	 	 	14,332	  	 	 	(2,032	) 	 	 	12,300	  	
Other (useful life of 1 to 15 years)	 	 	17,061	  	 	 	(4,318	) 	 	 	12,743	  	 	 	 	 	17,061	  	 	 	(3,454	) 	 	 	13,607	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	 	$	35,421	  	 	$	(8,011	) 	 	$	27,410	  	 	 	 	$	35,087	  	 	$	(6,405	) 	 	$	28,682	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Goodwill and other intangible assets not subject to amortization	 				 				 				 	 	 				 				 				
Goodwill	 				 				 	 	16,064	  	 	 	 				 				 	 	15,331	  	
Newspaper mastheads	 				 				 	 	31,800	  	 	 	 				 				 	 	31,800	  	
	 				 				 	 	 	 	 	 	 				 				 	 	 	 	
Total goodwill and other intangible assets	 				 				 	$	75,274	  	 	 	 				 				 	$	75,813	  	
	 				 				 	 	 	 	 	 	 				 				 	 	 	 	
Intangible liabilities subject to amortization	 				 				 				 	 	 				 				 				
Lease contract intangible liabilities	 	 	(545	) 	 	 	266	  	 	 	(279	) 	 	 	 	 	(545	) 	 	 	218	  	 	 	(327	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total intangible liabilities subject to amortization	 	$	(545	) 	 	$	266	  	 	$	(279	) 	 	 	 	$	(545	) 	 	$	218	  	 	$	(327	) 	

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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
The changes in the carrying amounts of intangible assets subject to amortization during the three months ended Mar. 30, 2014 were as follows (in thousands):

Intangible assets subject to amortization	  				
Balance as of Dec. 29, 2013	  	$	28,682	  	
Additions	  	 	334	  	
Amortization expense	  	 	(1,606	) 	
	  	 	 	 	
Balance as of Mar. 30, 2014	  	$	27,410	  	
	  	 	 	 	
The changes in the carrying amounts of intangible assets not subject to amortization and goodwill during the three months ended Mar. 30, 2014 were as follows (in thousands):

Other intangible assets not subject to amortization	  				
Balance as of Mar. 30, 2014 and Dec. 29, 2013	  	$	31,800	  	
	  	 	 	 	
Goodwill	  				
Balance as of Dec. 29, 2013	  	$	15,331	  	
Additions	  	 	733	  	
	  	 	 	 	
Balance as of Mar. 30, 2014	  	$	16,064	  	
	  	 	 	 	
As disclosed in Note 4 to Tribune Publishing’s audited combined financial statements, Tribune Publishing reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles—Goodwill and Other”.
NOTE 7: INVESTMENTS
Investments consisted of equity method investments totaling $3.5 million and $2.8 million at Mar. 30, 2014 and Dec. 29, 2013, respectively, in the following private companies:

Company	  	% Owned	 	
CIPS Marketing Group, Inc.	  	 	50	% 	
Homefinder.com, LLC	  	 	33	% 	
Locality Labs, LLC	  	 	35	% 	
McClatchy/Tribune Information Services	  	 	50	% 	
In the three months ended Mar. 30, 2014 and Mar. 31, 2013, Tribune Publishing recorded losses of $0.3 million and $0.4 million, respectively, relating to its equity method investments.
NOTE 8: FAIR VALUE MEASUREMENTS
Tribune Publishing measures and records in its combined financial statements certain assets and liabilities at fair value. ASC Topic 820, “Fair Value Measurements and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and Tribune Publishing’s own assumptions (unobservable inputs). This hierarchy consists of the following three levels:
 
 	—  	 	Level 1—Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market.	
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
 	—  	 	Level 2—Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets; or valuation models whose inputs are observable or unobservable but corroborated by market data.	
 
 	—  	 	Level 3—Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable inputs that are significant to the overall fair value measurement.	
The carrying values of cash, trade accounts receivable and trade accounts payable approximated their respective fair values due to their short term to maturity.
NOTE 9: INCOME TAXES
Subchapter S Corporation Election and Subsequent Conversion to C Corporation —On March 13, 2008, Tribune filed an election to be treated as a subchapter S corporation under the Internal Revenue Code, with the election effective as of the beginning of Tribune’s 2008 fiscal year. Tribune also elected to treat nearly all of its subsidiaries, including nearly all of the subsidiaries through which Tribune Publishing operates, as qualified subchapter S subsidiaries. Subject to certain limitations (such as built-in-gains tax applicable for ten years to gains accrued prior to the election), Tribune and Tribune Publishing were not subject to federal income tax. Although most states in which Tribune and Tribune Publishing operate recognize S corporation status, some impose tax at a reduced rate. Certain Tribune Publishing non-qualified subchapter S subsidiaries were subject to federal and state income taxes as C Corporations.
On the Effective Date, Tribune emerged from bankruptcy and issued shares of common stock to non-qualifying S corporation shareholders as more fully described in Note 2. As a result, Tribune’s S corporation election was terminated and Tribune, including Tribune Publishing, became taxable as a C corporation. As a C corporation, Reorganized Tribune Publishing is subject to income taxes at a higher effective tax rate beginning in the first quarter of 2013. The effect of this conversion was recorded in connection with Reorganized Tribune Publishing’s adoption of fresh-start reporting as described in Note 2. Accordingly, Tribune Publishing’s deferred income tax assets and liabilities were reinstated at a higher effective tax rate as of the Effective Date.
In conjunction with emergence from bankruptcy, Tribune Publishing was discharged from certain debt obligations as more fully described in Note 2. Generally, for federal tax purposes, the discharge of a debt obligation in a bankruptcy proceeding for an amount less than its adjusted issue price (as defined in the IRC) creates cancellation of indebtedness income (“CODI”) that is excludable from the obligor’s taxable income. However, certain income tax attributes are reduced by the amount of CODI. The prescribed order of income tax attribute reduction is as follows: (i) net operating losses for the year of discharge and net operating loss carryforwards, (ii) most credit carryforwards, including the general business credit and the minimum tax credit, (iii) net capital losses for the year of discharge and capital loss carryforwards and (iv) the tax basis of the debtors’ assets. Reorganized Tribune Publishing does not have any net operating loss carryforwards, credit carryforwards or capital loss carryforwards at the Effective Date and therefore these tax attribute reduction provisions do not apply. Based on Reorganized Tribune Publishing’s consolidated balance sheet on the Effective Date, Reorganized Tribune Publishing will not have a significant tax basis reduction resulting from the CODI rules.
Other —Tribune Publishing filed an election effective Dec. 30, 2013 to be taxed as a C Corporation. Accordingly, Tribune Publishing has computed income taxes as a separate return filing group. Current income taxes payable are settled with Tribune through the equity (deficit) account. For the three months ended Mar. 31,
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
2013, Tribune Publishing’s operations are included in Tribune’s federal and state C Corporation income tax returns. For the purposes of these combined financial statements, Tribune Publishing has computed its income taxes for the three months ended Mar. 31, 2013 as if it were filing separate returns.
For the three months ended Mar. 30, 2014, Tribune Publishing recorded income tax expense of $8.7 million and had an effective tax rate of 42.4%. This rate differs from the U.S. federal statutory rate primarily due to state income taxes, net of federal benefit, non-deductible expenses, certain transaction costs not fully deductible for tax purposes and the domestic production activities deduction. For the three months ended Mar. 31, 2013, Tribune Publishing recorded income tax expense of $16 million and had an effective tax rate of 43.3%. This rate differs from the U. S. federal statutory rate due primarily to state income taxes, net of federal benefit and the impact of non-deductible expenses.
NOTE 10: PENSION AND OTHER POSTRETIREMENT BENEFITS
Multiemployer Pension Plans —Tribune Publishing contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. See Note 4 for the description of costs and credits related to Tribune-sponsored pension plans.
Postretirement Benefits Other Than Pensions —Retirement benefits are provided to eligible employees of Tribune Publishing through defined benefit pension plans sponsored by Tribune. There is some variation in the provisions of these plans, including different provisions for lifetime maximums, prescription drug coverage and certain other benefits. The components of net periodic benefit cost for Tribune Publishing were as follows (in thousands):

 	  	Three Months Ended	 	
 	  	Mar. 30, 2014	 	  	Mar. 31, 2013	 	
Service cost	  	$	105	  	  	$	111	  	
Interest cost	  	 	450	  	  	 	387	  	
	  	 	 	 	  	 	 	 	
Net periodic benefit cost	  	$	555	  	  	$	498	  	
	  	 	 	 	  	 	 	 	
Expected Future Benefit Payments —For 2014 Tribune Publishing expects to contribute $5 million to its other postretirement plans.
NOTE 11: STOCK-BASED COMPENSATION
On Mar. 1, 2013, Tribune adopted the 2013 Equity Incentive Plan (“Equity Incentive Plan”) for the purpose of granting stock awards to directors, officers, and employees of Tribune. Stock awarded pursuant to the Equity Incentive Plan is limited to five percent of the outstanding Tribune common stock on a diluted basis. Tribune began issuing awards under the Equity Incentive Plan in the second quarter of 2013.
The Equity Incentive Plan provides for the granting of non-qualified stock options (“NSO”), restricted stock units (“RSU”), performance share units (“PSU”) and restricted and unrestricted stock awards. Pursuant to ASC Topic 718, “Compensation-Stock Compensation,” Tribune Publishing measures stock-based compensation costs on the grant date based on the estimated fair value of the award and recognizes compensation costs on a straight-line basis over the requisite service period for the entire award. The Equity Incentive Plan allows employees to surrender to Tribune shares of vested common stock upon vesting of their stock awards or at the time they exercise their NSOs in lieu of their payment of the required withholdings for employee taxes. Tribune does not withhold taxes in excess of minimum required statutory requirements.
 
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Table of Contents
TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
(unaudited)
 
Stock-based compensation expense for participants in the Equity Incentive Plan that are solely dedicated to Tribune Publishing have been included within selling, general and administrative expense within these combined financial statements. Stock-based compensation expense for participants in the Equity Incentive Plan that are not solely dedicated to Tribune Publishing have been allocated to Tribune Publishing through the corporate management fee and technology service center support costs, as described in Note 4. Stock-based compensation expense related to Tribune Publishing’s employees during the three months ended Mar. 30, 2014 totaled $0.7 million. No stock-based compensation expensed was recognized in the three months ended Mar. 31, 2013. In the three months ended Mar. 30, 2014, Tribune Publishing was allocated $2.6 million of stock-based compensation expense through the corporate management fee and technology service center support costs. There was no allocated stock-based compensation expense for the three months ended Mar. 31, 2013.
NOTE 12: SUBSEQUENT EVENTS
On May 1, 2014, the Company completed an acquisition of Capital-Gazette Communications, LLC and Landmark Community Newspapers of Maryland, LLC from Landmark Media Enterprises, LLC (the “Landmark Acquisition”) for $30 million, subject to certain final adjustments. The Landmark acquisition expands the Company’s breadth of coverage in Maryland and adjacent areas and includes The Capital in the Annapolis region and the Carroll County Times and their related publications.
On May 7, 2014, Tribune Publishing’s subsidiary, TCA News Service, LLC, purchased the remaining 50% interest in McClatchy/Tribune Information Systems from the McClatchy Company.
 
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Table of Contents
 Report of Independent Registered Public Accounting Firm
To the Management and Board of Directors of Tribune Company:
In our opinion, the accompanying combined balance sheet and the related combined statements of comprehensive income, equity (deficit) and cash flows present fairly, in all material respects, the financial position of Tribune Publishing Company (Successor), a business of Tribune Company, at December 29, 2013 and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of Tribune Publishing Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit 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 audit provides a reasonable basis for our opinion.
As discussed in Note 2 to the combined financial statements, the United States Bankruptcy Court for the district of Delaware confirmed the Fourth Amended Joint Plan of Reorganization for Tribune Company and its subsidiaries (the “Plan”) on July 23, 2012. Confirmation of the Plan resulted in the discharge of all claims against Tribune Company and its subsidiaries that arose before December 8, 2008 and substantially alters rights and interests of equity security holders as provided for in the Plan. The Plan was substantially consummated on December 31, 2012 and Tribune Company and its subsidiaries, including the subsidiaries that comprise the Tribune Publishing Company business, emerged from bankruptcy. In connection with the emergence from bankruptcy, Tribune Publishing Company adopted fresh start accounting as of December 31, 2012.

/s/ PricewaterhouseCoopers LLP	
Chicago, Illinois	
April 11, 2014	
 
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Table of Contents
Report of Independent Registered Public Accounting Firm
To the Management and Board of Directors of Tribune Company:
In our opinion, the accompanying combined balance sheet and the related combined statements of comprehensive income, equity (deficit) and cash flows present fairly, in all material respects, the financial position of Tribune Publishing Company (Predecessor), a business of Tribune Company, at December 30, 2012 and the results of its operations and its cash flows for the one day ended December 31, 2012, for the year ended December 30, 2012, and for the year ended December 25, 2011 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of Tribune Publishing 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 audits 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.
As discussed in Note 2 to the combined financial statements, Tribune Company filed a petition on December 8, 2008 with the United States Bankruptcy Court for the district of Delaware for reorganization under the provisions of Chapter 11 of the Bankruptcy Code. The Fourth Amended Joint Plan of Reorganization for Tribune Company and its subsidiaries (the “Plan”) was substantially consummated on December 31, 2012 and Tribune Company and its subsidiaries, including the subsidiaries that comprise the Tribune Publishing Company business, emerged from bankruptcy. In connection with the emergence from bankruptcy, Tribune Publishing Company adopted fresh start accounting.

/s/ PricewaterhouseCoopers LLP	
Chicago, Illinois	
April 11, 2014	
 
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TRIBUNE PUBLISHING COMPANY
 COMBINED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)

 	 	Successor	 	 	   	 	Predecessor	 	
 	 	Year Ended	 	 	   	 	 	 	 	Year Ended	 	
 	 	Dec. 29, 2013	 	 	   	 	Dec. 31, 2012	 	 	Dec. 30, 2012	 	 	Dec. 25, 2011	 	
Operating Revenues	 				 	 	 				 				 				
Advertising	 	$	1,052,877	  	 	 	 	$	—	  	 	$	1,158,248	  	 	$	1,241,593	  	
Circulation	 	 	428,615	  	 	 	 	 	—	  	 	 	424,629	  	 	 	390,433	  	
Other	 	 	313,615	  	 	 	 	 	—	  	 	 	330,937	  	 	 	283,906	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total operating revenues	 	 	1,795,107	  	 	 	 	 	—	  	 	 	1,913,814	  	 	 	1,915,932	  	
Operating Expenses	 				 	 	 				 				 				
Cost of sales (exclusive of items shown below)	 	 	1,010,078	  	 	 	 	 	—	  	 	 	1,143,128	  	 	 	1,154,419	  	
Selling, general and administrative	 	 	590,069	  	 	 	 	 	—	  	 	 	642,368	  	 	 	630,599	  	
Depreciation	 	 	21,851	  	 	 	 	 	—	  	 	 	80,280	  	 	 	80,616	  	
Amortization	 	 	6,580	  	 	 	 	 	—	  	 	 	6,382	  	 	 	5,729	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total operating expenses	 	 	1,628,578	  	 	 	 	 	—	  	 	 	1,872,158	  	 	 	1,871,363	  	
Operating Profit	 	 	166,529	  	 	 	 	 	—	  	 	 	41,656	  	 	 	44,569	  	
Loss on equity investments, net	 	 	(1,187	) 	 	 	 	 	—	  	 	 	(2,349	) 	 	 	(900	) 	
Interest income (expense), net	 	 	14	  	 	 	 	 	—	  	 	 	(31	) 	 	 	75	  	
Write-down of investment	 	 	—	  	 	 	 	 	—	  	 	 	(6,141	) 	 	 	—	  	
Other non-operating loss, net	 	 	—	  	 	 	 	 	—	  	 	 	—	  	 	 	(1	) 	
Reorganization items, net	 	 	(270	) 	 	 	 	 	2,754,553	  	 	 	(1,446	) 	 	 	410	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income Before Income Taxes	 	 	165,086	  	 	 	 	 	2,754,553	  	 	 	31,689	  	 	 	44,153	  	
Income tax expense (benefit)	 	 	70,992	  	 	 	 	 	(87,773	) 	 	 	3,294	  	 	 	2,539	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net Income	 	$	94,094	  	 	 	 	$	2,842,326	  	 	$	28,395	  	 	$	41,614	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Comprehensive Income (Loss) After Taxes	 				 	 	 				 				 				
Unrecognized benefit plan gains and losses:	 				 	 	 				 				 				
Change in unrecognized benefit plan gains and losses arising during the period, net of taxes of $202, $(74) and $(31), respectively	 	 	(310	) 	 	 	 	 	—	  	 	 	8,168	  	 	 	3,410	  	
Adjustment for previously unrecognized benefit plan gains and losses included in net income, net of taxes of $11 and $11, respectively	 	 	—	  	 	 	 	 	—	  	 	 	(1,182	) 	 	 	(1,182	) 	
Fresh-start reporting adjustment included in net income to eliminate Predecessor’s accumulated other comprehensive income, net of taxes of $6,440	 	 	—	  	 	 	 	 	(27,158	) 	 	 	—	  	 	 	—	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Comprehensive Income (Loss), net of taxes	 	 	(310	) 	 	 	 	 	(27,158	) 	 	 	6,986	  	 	 	2,228	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Comprehensive Income	 	$	93,784	  	 	 	 	$	2,815,168	  	 	$	35,381	  	 	$	43,842	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Supplemental Income Tax Information	 				 	 	 				 				 				
Pro forma income tax expense at C corporation effective tax rate	 				 	 	 				 	$	13,924	  	 	$	18,685	  	
The accompanying notes are an integral part of these audited combined financial statements.
 
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TRIBUNE PUBLISHING COMPANY
 COMBINED BALANCE SHEETS
(In thousands)

 	  	Successor	 	 	   	  	Predecessor	 	
 	  	Dec. 29, 2013	 	 	   	  	Dec. 30, 2012	 	
Assets	  				 	 	  				
Current Assets	  				 	 	  				
Cash	  	$	9,694	  	 	 	  	$	13,768	  	
Accounts receivable (net of allowances of $12,856 and $13,431)	  	 	251,636	  	 	 	  	 	256,985	  	
Inventories	  	 	14,222	  	 	 	  	 	12,537	  	
Deferred income taxes	  	 	37,371	  	 	 	  	 	1,147	  	
Prepaid expenses and other	  	 	13,570	  	 	 	  	 	14,733	  	
	  	 	 	 	 	 	  	 	 	 	
Total current assets	  	 	326,493	  	 	 	  	 	299,170	  	
	  	 	 	 	 	 	  	 	 	 	
Properties	  				 	 	  				
Machinery, equipment and furniture	  	 	64,825	  	 	 	  	 	1,328,859	  	
Buildings and leasehold improvements	  	 	3,923	  	 	 	  	 	511,475	  	
	  	 	 	 	 	 	  	 	 	 	
	  	 	68,748	  	 	 	  	 	1,840,334	  	
Accumulated depreciation	  	 	(15,973	) 	 	 	  	 	(1,322,830	) 	
	  	 	 	 	 	 	  	 	 	 	
	  	 	52,775	  	 	 	  	 	517,504	  	
Land	  	 	—	  	 	 	  	 	67,204	  	
Construction in progress	  	 	15,153	  	 	 	  	 	30,670	  	
	  	 	 	 	 	 	  	 	 	 	
Net properties	  	 	67,928	  	 	 	  	 	615,378	  	
	  	 	 	 	 	 	  	 	 	 	
Other Assets	  				 	 	  				
Goodwill	  	 	15,331	  	 	 	  	 	—	  	
Intangible assets, net	  	 	60,482	  	 	 	  	 	28,911	  	
Investments	  	 	2,799	  	 	 	  	 	3,986	  	
Deferred income taxes	  	 	39,587	  	 	 	  	 	—	  	
Other	  	 	1,746	  	 	 	  	 	3,787	  	
	  	 	 	 	 	 	  	 	 	 	
Total other assets	  	 	119,945	  	 	 	  	 	36,684	  	
	  	 	 	 	 	 	  	 	 	 	
Total assets	  	$	514,366	  	 	 	  	$	951,232	  	
	  	 	 	 	 	 	  	 	 	 	
Liabilities and Equity (Deficit)	  				 	 	  				
Current Liabilities	  				 	 	  				
Accounts payable	  	$	36,329	  	 	 	  	$	37,710	  	
Employee compensation and benefits	  	 	103,351	  	 	 	  	 	103,077	  	
Deferred revenue	  	 	67,934	  	 	 	  	 	66,835	  	
Other	  	 	20,866	  	 	 	  	 	26,359	  	
	  	 	 	 	 	 	  	 	 	 	
Total current liabilities	  	 	228,480	  	 	 	  	 	233,981	  	
	  	 	 	 	 	 	  	 	 	 	
Non-Current Liabilities	  				 	 	  				
Deferred revenue	  	 	7,015	  	 	 	  	 	9,386	  	
Postretirement medical, life and other benefits	  	 	45,373	  	 	 	  	 	47,378	  	
Other obligations	  	 	8,673	  	 	 	  	 	9,536	  	
	  	 	 	 	 	 	  	 	 	 	
Total non-current liabilities	  	 	61,061	  	 	 	  	 	66,300	  	
Liabilities Subject to Compromise	  	 	—	  	 	 	  	 	2,865,890	  	
Commitments and Contingent Liabilities (Note 10)	  	 	—	  	 	 	  	 	—	  	
Total Equity (Deficit)	  	 	224,825	  	 	 	  	 	(2,214,939	) 	
	  	 	 	 	 	 	  	 	 	 	
Total liabilities and equity (deficit)	  	$	514,366	  	 	 	  	$	951,232	  	
	  	 	 	 	 	 	  	 	 	 	
The accompanying notes are an integral part of these audited combined financial statements.
 
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TRIBUNE PUBLISHING COMPANY
 COMBINED STATEMENTS OF EQUITY (DEFICIT)
(In thousands)

 	  	Parent
Company
Investment	 	 	Accumulated
Other
Comprehensive
Income	 	 	Total
Equity (Deficit)	 	
Balance at Dec. 26, 2010 (Predecessor)	  	$	(2,155,908	) 	 	$	17,944	  	 	$	(2,137,964	) 	
Transactions with Tribune Company and Tribune Affiliates, net	  	 	(52,495	) 	 	 	—	  	 	 	(52,495	) 	
Comprehensive income:	  				 				 				
Net income	  	 	41,614	  	 	 	—	  	 	 	41,614	  	
Other comprehensive income, net of taxes	  	 	—	  	 	 	2,228	  	 	 	2,228	  	
	  				 				 	 	 	 	
Comprehensive income	  	 	—	  	 	 	—	  	 	 	43,842	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Balance at Dec. 25, 2011 (Predecessor)	  	$	(2,166,789	) 	 	$	20,172	  	 	$	(2,146,617	) 	
Transactions with Tribune Company and Tribune Affiliates, net	  	 	(103,703	) 	 	 	—	  	 	 	(103,703	) 	
Comprehensive income:	  				 				 				
Net income	  	 	28,395	  	 	 	—	  	 	 	28,395	  	
Other comprehensive income, net of taxes	  	 	—	  	 	 	6,986	  	 	 	6,986	  	
	  				 				 	 	 	 	
Comprehensive income	  	 	—	  	 	 	—	  	 	 	35,381	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Balance at Dec. 30, 2012 (Predecessor)	  	$	(2,242,097	) 	 	$	27,158	  	 	$	(2,214,939	) 	
Comprehensive income:	  				 				 				
Net income	  	 	2,842,326	  	 	 	—	  	 	 	2,842,326	  	
Other comprehensive income, net of taxes	  	 	—	  	 	 	(27,158	) 	 	 	(27,158	) 	
	  				 				 	 	 	 	
Comprehensive income	  	 	—	  	 	 	—	  	 	 	2,815,168	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Balance at Dec. 31, 2012 (Successor)	  	$	600,229	  	 	$	—	  	 	$	600,229	  	
Transactions with Tribune Company and Tribune Affiliates, net	  	 	(451,376	) 	 	 	—	  	 	 	(451,376	) 	
Related party dividends	  	 	(17,812	) 	 	 	—	  	 	 	(17,812	) 	
Comprehensive income:	  				 				 				
Net income	  	 	94,094	  	 	 	—	  	 	 	94,094	  	
Other comprehensive income, net of taxes	  	 	—	  	 	 	(310	) 	 	 	(310	) 	
	  				 				 	 	 	 	
Comprehensive income	  	 	—	  	 	 	—	  	 	 	93,784	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Balance at Dec. 29, 2013 (Successor)	  	$	225,135	  	 	$	(310	) 	 	$	224,825	  	

The accompanying notes are an integral part of these audited combined financial statements.
 
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TRIBUNE PUBLISHING COMPANY
 COMBINED STATEMENTS OF CASH FLOWS
(In thousands)

 	 	Successor	 	 	   	 	Predecessor	 	
 	 	Year Ended	 	 	   	 	 	 	 	Year Ended	 	
 	 	Dec. 29, 2013	 	 	   	 	Dec. 31, 2012	 	 	Dec. 30, 2012	 	 	Dec. 25, 2011	 	
Operating Activities	 				 	 	 				 				 				
Net income	 	$	94,094	  	 	 	 	$	2,842,326	  	 	$	28,395	  	 	$	41,614	  	
Adjustments to reconcile net income to net cash provided by operating activities:	 				 	 	 				 				 				
Depreciation	 	 	21,851	  	 	 	 	 	—	  	 	 	80,280	  	 	 	80,616	  	
Amortization of intangible assets	 	 	6,580	  	 	 	 	 	—	  	 	 	6,382	  	 	 	5,729	  	
Amortization of contract intangible liabilities	 	 	(218	) 	 	 	 	 	—	  	 	 	—	  	 	 	—	  	
Write-downs of property	 	 	—	  	 	 	 	 	—	  	 	 	—	  	 	 	1,200	  	
Loss on equity investments, net	 	 	1,187	  	 	 	 	 	—	  	 	 	2,349	  	 	 	900	  	
Distributions from equity investments	 	 	—	  	 	 	 	 	—	  	 	 	642	  	 	 	—	  	
Write-down of investment	 	 	—	  	 	 	 	 	—	  	 	 	6,141	  	 	 	—	  	
Non-cash reorganization items, net	 	 	(126	) 	 	 	 	 	(2,756,494	) 	 	 	1,362	  	 	 	(410	) 	
Changes in working capital items, excluding effects from acquisitions:	 				 	 	 				 				 				
Accounts receivable, net	 	 	5,795	  	 	 	 	 	—	  	 	 	33,304	  	 	 	(18,649	) 	
Inventories	 	 	4,125	  	 	 	 	 	—	  	 	 	214	  	 	 	364	  	
Prepaid expenses and other current assets	 	 	842	  	 	 	 	 	—	  	 	 	(1,829	) 	 	 	1,789	  	
Accounts payable, employee compensation and benefits, deferred revenue and other current liabilities	 	 	(2,301	) 	 	 	 	 	8,381	  	 	 	(9,821	) 	 	 	(14,468	) 	
Non-current deferred revenue	 	 	(2,329	) 	 	 	 	 	—	  	 	 	(1,777	) 	 	 	9,320	  	
Deferred income taxes	 	 	18,333	  	 	 	 	 	(94,213	) 	 	 	—	  	 	 	—	  	
Postretirement medical, life and other benefits	 	 	(2,315	) 	 	 	 	 	—	  	 	 	(5,867	) 	 	 	(6,296	) 	
Other, net	 	 	2,201	  	 	 	 	 	—	  	 	 	(1,629	) 	 	 	1,755	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash provided by operating activities	 	 	147,719	  	 	 	 	 	—	  	 	 	138,146	  	 	 	103,464	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Investing Activities	 				 	 	 				 				 				
Capital expenditures	 	 	(19,736	) 	 	 	 	 	—	  	 	 	(52,261	) 	 	 	(46,240	) 	
Acquisitions and investments	 	 	(206	) 	 	 	 	 	—	  	 	 	(10,288	) 	 	 	(1,587	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash used for investing activities	 	 	(19,942	) 	 	 	 	 	—	  	 	 	(62,549	) 	 	 	(47,827	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Financing Activities	 				 	 	 				 				 				
Repayments of capital lease obligations	 	 	(256	) 	 	 	 	 	—	  	 	 	(282	) 	 	 	(272	) 	
Related party dividends	 	 	(17,812	) 	 	 	 	 	—	  	 	 	—	  	 	 	—	  	
Transactions with Tribune Company and Tribune Affiliates, net	 	 	(113,783	) 	 	 	 	 	—	  	 	 	(68,775	) 	 	 	(52,495	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash used for financing activities	 	 	(131,851	) 	 	 	 	 	—	  	 	 	(69,057	) 	 	 	(52,767	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net (Decrease) Increase in Cash	 	 	(4,074	) 	 	 	 	 	—	  	 	 	6,540	  	 	 	2,870	  	
Cash, beginning of period	 	 	13,768	  	 	 	 	 	13,768	  	 	 	7,228	  	 	 	4,358	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash, end of period	 	$	9,694	  	 	 	 	$	13,768	  	 	$	13,768	  	 	$	7,228	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Supplemental Cash Flow Information	 				 	 	 				 				 				
Non-cash property transfers with Tribune Company and Tribune Affiliates (Notes 1 and 6)	 	$	337,593	  	 	 	 	$	—	  	 	$	34,928	  	 	$	—	  	
The accompanying notes are an integral part of these audited combined financial statements.
 
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TRIBUNE PUBLISHING COMPANY
 NOTES TO THE COMBINED FINANCIAL STATEMENTS
NOTE 1: DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Business Operations —The accompanying combined financial statements include the accounts of Tribune Publishing Company (“Tribune Publishing”), a business representing the principal publishing operations of Tribune Company (“Tribune”), as described below. Tribune Publishing’s operations are comprised of the direct and indirect subsidiaries of Tribune Publishing Company, LLC (“TPC”), a wholly-owned subsidiary of Tribune, and certain other assets of Tribune and its non-Tribune Publishing subsidiaries (“Tribune Affiliates”) as further described below. TPC, formerly known as Tribune Publishing Company, was converted into a limited liability company in connection with the restructuring transactions described below. In addition, certain direct and indirect subsidiaries were formed or became owned by TPC as a result of these restructuring transactions.
Tribune Publishing’s operations consist of eight major-market daily newspapers and related businesses, distribution of preprinted insert advertisements, commercial printing and delivery services to other newspapers, distribution of syndicated content and management of the websites of Tribune’s daily newspapers, along with other branded products that target specific areas of interest. The daily newspapers published by Tribune Publishing are the Los Angeles Times ; the Chicago Tribune ; the Sun Sentinel ; the Orlando Sentinel ; The Baltimore Sun ; the Hartford Courant ; The Morning Call , serving Pennsylvania’s Lehigh Valley; and the Daily Press , serving the Virginia Peninsula. Tribune Publishing’s operations also include Blue Lynx Media, LLC (“BLM”) which operates a shared service center for the benefit of Tribune and its subsidiaries, including the subsidiaries of Tribune Publishing; a 50% equity interest in CIPS Marketing Group, Inc. (“CIPS”); a 50% equity interest in McClatchy/Tribune Information Services (“MCT”); a 33% equity interest in Homefinder.com, LLC (“Homefinder”); and a 35% equity interest in Locality Labs, LLC (“Locality Labs”), formerly known as Journatic, LLC, which Tribune will retain following the expected separation of Tribune Publishing from Tribune (see “Separation from Tribune Company and Basis of Presentation” discussion below).
Fiscal Year —Tribune Publishing’s fiscal year ends on the last Sunday in December. Fiscal years 2013 and 2011 each comprised a 52-week period. Tribune Publishing’s 2012 fiscal year ended on Dec. 30, 2012 and comprised a 53-week period.
Separation from Tribune Company and Basis of Presentation —On July 10, 2013, Tribune announced its plan to spin-off essentially all of its publishing businesses into an independent company, Tribune Publishing. Tribune expects the transaction to be in the form of a pro rata distribution of substantially all of the common stock of Tribune Publishing to holders of Tribune common stock and warrants and anticipates that the distribution will be tax-free to Tribune and Tribune’s U.S. shareholders.
Tribune Publishing’s operations are conducted through the following wholly-owned subsidiaries (including each subsidiary’s respective direct wholly-owned subsidiaries) of TPC: The Morning Call, LLC; Chicago Tribune Company, LLC; The Baltimore Sun Company, LLC; Orlando Sentinel Communications Company, LLC; Los Angeles Times Communications LLC; The Daily Press, LLC; The Hartford Courant Company, LLC; Sun-Sentinel Company, LLC; Tribune Washington Bureau, LLC; Hoy Publications, LLC; Tribune Interactive, LLC; Tribune 365, LLC; Tribune Content Agency, LLC; forsalebyowner.com, LLC; Builder Media Solutions, LLC; and BLM. Historically, separate financial statements have not been prepared for Tribune Publishing. The accompanying combined financial statements are derived from the historical accounting records of Tribune and present Tribune Publishing’s combined financial position, results of operations and cash flows as of and for the periods presented as if Tribune Publishing was a separate entity and as it was historically managed. Management believes that assumptions and methodologies underlying the allocation of general corporate expenses are reasonable. However, such expenses may not be indicative of the actual level of expense that would have been incurred had Tribune Publishing operated as a separate stand-alone entity, and, accordingly, may not necessarily reflect Tribune Publishing’s combined financial position, results of operations and cash flows had Tribune Publishing operated as a stand-alone entity during the periods presented.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
These combined financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain assets of Tribune and Tribune Affiliates that are not owned by TPC and are otherwise specifically identifiable or attributable to Tribune Publishing and are necessary to present these combined financial results on a stand-alone basis have also been included in these combined financial statements.
Tribune and Tribune Affiliates consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan (as defined and described in Note 2). These restructuring transactions included, among other things, establishing a number of real estate holding companies. On Dec. 21, 2012, the majority of the land and buildings owned by Tribune Publishing were transferred to Tribune’s newly established real estate holding companies.
In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back certain land and buildings that were transferred. Although the properties subject to related party leases were legally transferred to the holding companies, Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing involvement with the properties, which pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification™ (“ASC”) Topic 840, “Leases,” precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result, Tribune Publishing continued to account for and depreciate the carrying values of the transferred properties subject to related party leases and rent payments were accounted for as dividends to Tribune and Tribune Affiliates.
On Dec. 1, 2013, Tribune Publishing modified the specific provisions within the related party leases to address the prohibited forms of continuing involvement. This resulted in Tribune Publishing derecognizing those properties by recording a $337.6 million reduction to net properties and a corresponding reduction to the net parent company investment component of equity (deficit) in its combined balance sheet. The related party leases subsequent to the lease modification on Dec. 1, 2013 have been accounted for as operating leases. See Note 6 for further information.
The remainder of the transferred properties are no longer utilized in the operations of Tribune Publishing; therefore, Tribune Publishing did not enter into related party leases for those properties. Tribune Publishing entered into management agreements with the real estate holding companies pursuant to which it will manage those properties for an initial term of one year, cancellable by the real estate holding companies with a 30-day notice.
In connection with the spin-off, Tribune Publishing expects to enter into various agreements with Tribune and other third parties that may be on different terms than the terms of the arrangements or agreements that existed prior to the spin-off. For instance, Tribune Publishing utilizes the services of Tribune and Tribune Affiliates for certain functions such as legal, finance, human resources and information technology services, as well as various corporate-wide employee benefit programs. The costs of Tribune services that are specifically identifiable to Tribune Publishing are included in these combined financial statements. The costs of Tribune services that are incurred by Tribune but are not specifically identifiable to Tribune Publishing have been allocated to Tribune Publishing and included in these combined financial statements on bases that management considered to be a reasonable reflection of the utilization of services provided or the benefit received by Tribune Publishing during the periods presented. While management considers these allocations to have been made on a reasonable basis, the allocations do not necessarily reflect the expenses that would have been incurred had Tribune Publishing operated as a stand-alone entity. All such costs and expenses are assumed to be settled with Tribune through the parent company investment, a component of equity (deficit), in the period in which the costs were incurred. Current income taxes are also assumed to be settled with Tribune through the parent company investment in the period the related income taxes were recorded.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
All intercompany accounts within Tribune Publishing have been eliminated in consolidation. All significant intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates have been included within the combined financial statements and are considered to be effectively settled through equity contributions or distributions or through cash payments at the time the transactions were recorded. Except for amounts due to Tribune Affiliates for promissory demand notes, the accumulated net effect of intercompany transactions between either (i) Tribune Publishing and Tribune or (ii) Tribune Publishing and Tribune Affiliates are included in the parent company investment component of equity (deficit). These intercompany transactions are further described in Note 6. The total net effect of these intercompany transactions, including debt transactions with Tribune and Tribune Affiliates, is reflected in the combined statements of cash flows as financing activities.
Tribune Publishing assesses its operating segments in accordance with ASC Topic 280, “Segment Reporting.” Tribune Publishing is managed by its chief operating decision maker, as defined by ASC Topic 280, as one business. Accordingly, the financial statements of Tribune Publishing are presented to reflect one reporting segment.
NOTE 2: PROCEEDINGS UNDER CHAPTER 11
Chapter 11 Reorganization —On Dec. 8, 2008 (the “Petition Date”), Tribune, and 110 of its direct and indirect wholly-owned subsidiaries (each a “Debtor” and, collectively, the “Debtors”), filed voluntary petitions for relief (collectively, the “Chapter 11 Petitions”) under Chapter 11 (“Chapter 11”) of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Debtors’ Chapter 11 proceedings continue to be jointly administered under the caption “ In re: Tribune Company, et al. ,” Case No. 08-13141. Certain of the legal entities included in the combined financial statements of Tribune Publishing were Debtors or, as a result of the restructuring transactions described below, are successor legal entities to legal entities that were Debtors (collectively, the “Tribune Publishing Debtors”). References to the Debtors herein include the Tribune Publishing Debtors unless otherwise indicated. Other legal entities included in the accompanying combined financial statements of Tribune Publishing did not file petitions for relief under Chapter 11 of the Bankruptcy Code as of or subsequent to the Petition Date, and were, therefore, not Debtors, and are not successors to legal entities that were Debtors (each a “Non-Debtor Subsidiary” and, collectively, the “Non-Debtor Subsidiaries”) as of Dec. 31, 2012. For all periods presented herein, the Non-Debtor Subsidiaries included in the combined financial statements of Tribune Publishing are Tribune Interactive, LLC (as the successor legal entity to Tribune Interactive, Inc.); Riverwalk Center I Joint Venture; Tribune Hong Kong Limited, a foreign subsidiary; BLM; and Local Pro Plus Realty, LLC, a legal entity established subsequent to the Petition Date.
As further described below, a joint plan of reorganization for the Debtors, including the Tribune Publishing Debtors, became effective and the Debtors emerged from Chapter 11 on Dec. 31, 2012 (the “Effective Date”). Where appropriate, Tribune Publishing and its business operations as conducted on or after Dec. 31, 2012 are herein referred to as “Reorganized Tribune Publishing,” “Reorganized Tribune Publishing Debtors,” “Successor Tribune Publishing,” or “Successor.” Tribune and its business operations conducted on or after Dec. 31, 2012 are herein referred to as “Reorganized Tribune Company” and such references include Reorganized Tribune Publishing and Reorganized Tribune Publishing Debtors unless otherwise indicated. Where appropriate, Tribune Publishing and its business operations as conducted on or prior to Dec. 30, 2012 are herein referred to as “Predecessor Tribune Publishing” or “Predecessor.”
From the Petition Date and until the Effective Date, the Debtors operated their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and applicable orders of the
 
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Bankruptcy Court. In general, as debtors-in-possession, the Debtors were authorized under Chapter 11 of the Bankruptcy Code to continue to operate as ongoing businesses, but could not engage in transactions outside the ordinary course of business without the prior approval of the Bankruptcy Court.
Plan of Reorganization —In order to emerge from Chapter 11, a Chapter 11 plan that satisfies the requirements of the Bankruptcy Code and provides for emergence from bankruptcy as a going concern must be proposed and confirmed by a bankruptcy court. A plan of reorganization addresses, among other things, prepetition obligations, sets forth the revised capital structure of the newly-reorganized entities and provides for their corporate governance subsequent to emergence from court supervision under Chapter 11. The disclosures below relate to the joint plan of reorganization for the Debtors and not to any individual plan of reorganization for the Tribune Publishing Debtors unless otherwise indicated.
On April 12, 2012, the Debtors, the official committee of unsecured creditors (the “Creditors’ Committee”), Oaktree Capital Management, L.P. (“Oaktree”), a creditor under certain Tribune prepetition debt facilities, Angelo, Gordon & Co. L.P. (“AG”), a creditor under certain Tribune prepetition debt facilities, and JPMorgan Chase Bank, N.A. (“JPMorgan”), an administrative agent and a creditor under certain Tribune prepetition debt facilities (collectively, the “Plan Proponents”) filed the Fourth Amended Joint Plan of Reorganization for Tribune Company and Its Subsidiaries (as subsequently amended and modified, the “Plan”) with the Bankruptcy Court.
The Plan was the product of extensive negotiations and contested proceedings before the Bankruptcy Court due, in part, to certain claims and causes of action related to a series of transactions, collectively referred to as the “Leveraged ESOP Transactions,” that were undertaken by Tribune in 2007. These transactions resulted in Tribune becoming wholly-owned by an employee stock ownership plan (the “ESOP”) on Dec. 20, 2007. At the Debtors’ request, on Sept. 1, 2010, the Bankruptcy Court appointed a mediator to conduct a non-binding mediation concerning the terms of a plan of reorganization, including the appropriate resolution of claims and causes of action related to the Leveraged ESOP Transactions (the “Mediation”). The Mediation began on Sept. 26, 2010 and ultimately resulted in a settlement agreement (the “Settlement Agreement”) between the Debtors, the Creditors’ Committee, AG, Oaktree, JPMorgan and a group of funds and managed accounts represented by King Street Acquisition Company, LLC, King Street Capital, LP and Marathon Asset Management, LP that were lenders under certain Tribune prepetition debt facilities. The Settlement Agreement provided for the settlement of certain causes of action arising in connection with the Leveraged ESOP Transactions, other than certain causes of action predefined as preserved. The terms of the Settlement Agreement, with certain modifications, were incorporated into the Plan filed with the Bankruptcy Court on April 12, 2012.
On July 23, 2012, the Bankruptcy Court issued an order (the “Confirmation Order”) confirming the Plan. The Plan constitutes a separate plan of reorganization for each of the Debtors and sets forth the terms and conditions of the Debtors’ reorganization. See “Terms of the Plan” section below for a description of the terms and conditions of the confirmed Plan as the Plan pertains to the Tribune Publishing Debtors.
Notices of appeal of the Confirmation Order were filed in August 2012 by certain Tribune creditors. The confirmation appeals have been transmitted to the United States District Court for the District of Delaware (“Delaware District Court”) and have been consolidated, together with two previously-filed appeals of the Bankruptcy Court’s orders relating to certain provisions in the Plan.
The appellants seek, among other relief, to overturn the Confirmation Order and certain prior orders of the Bankruptcy Court, including the settlement of certain claims and causes of action related to the Leveraged ESOP Transactions contained in the Plan. There is currently no stay of the Confirmation Order in place pending
 
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resolution of the confirmation-related appeals and those appeals remain pending before the Delaware District Court. In January 2013, Reorganized Tribune Company filed a motion to dismiss the appeals as equitably moot, based on the substantial consummation of the Plan. That request has been fully briefed by the parties and the motion remains pending.
As described in Note 1, during the fourth quarter of 2012 and prior to the Effective Date, Tribune and its subsidiaries consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan. These restructuring transactions included, among other things, (i) converting certain of Tribune’s subsidiaries into limited liability companies or merging certain of Tribune’s subsidiaries into newly-formed limited liability companies, (ii) consolidating and reallocating certain operations, entities, assets and liabilities within the organizational structure of Tribune and (iii) establishing a number of real estate holding companies. Among other things, the restructuring transactions resulted in TPC being converted into a limited liability company (prior to the conversion, TPC was a corporation named Tribune Publishing Company) as well as becoming the holding company for the principal direct and indirect subsidiaries that own and operate the business of Tribune Publishing as described in Note 1.
On the Effective Date, all of the conditions precedent to the effectiveness of the Plan were satisfied or waived, the Debtors emerged from Chapter 11, and the settlements, agreements and transactions contemplated by the Plan to be effected on the Effective Date were implemented, including, among other things, the appointment of a new board of directors of Tribune and the initiation of distributions to creditors. As a result, the ownership of Tribune changed from the ESOP to certain of Tribune’s creditors on the Effective Date. In connection with the Debtors’ emergence from Chapter 11, on the Effective Date and in accordance with and subject to the terms of the Plan, (i) all of Tribune’s $0.01 par value common stock held by the ESOP was cancelled and (ii) new shares of Reorganized Tribune Company were issued to shareholders who did not meet the necessary criteria to qualify as a subchapter S corporation shareholder. As a result, Reorganized Tribune Company converted from a subchapter S corporation to a C corporation under the Internal Revenue Code (“IRC”). This conversion also affected Tribune subsidiaries that were treated as qualified subchapter S subsidiaries, including certain legal entities included in the accompanying combined financial statements of Tribune Publishing. See Note 11 for further information. In addition, Tribune’s direct and indirect ownership interests in the Tribune Publishing Debtors and Non-Debtor Subsidiaries, after giving effect to the restructuring transactions, were reinstated on the Effective Date.
Terms of the Plan —The following is a summary of the material settlements and other agreements entered into, distributions made and transactions consummated by Reorganized Tribune Publishing on or about the Effective Date pursuant to, and in accordance with, the terms of the Plan. The following summary only highlights certain of the substantive provisions of the Plan as it relates to Reorganized Tribune Publishing and is not intended to be a complete description of, or a substitute for a full and complete reading of, the Plan and the agreements and other documents related thereto, including those described below.
 
 	—  	 	Cancellation of certain prepetition obligations : On the Effective Date, the Tribune Publishing Debtors’ prepetition debt and certain other obligations were cancelled, terminated and/or extinguished, including (i) cancellation of the $2.8 billion promissory demand notes due to Tribune Finance and (ii) the cancellation of guarantee obligations by certain Tribune Publishing Debtors under certain of Tribune’s prepetition credit facilities (other than for purposes of allowing creditors thereunder to receive distributions under the Plan and allowing the administrative agent for such facilities to exercise certain limited rights).	
 
 	—  	 	Assumption of prepetition executory contracts and unexpired leases : On the Effective Date, any prepetition executory contracts or unexpired leases of the Tribune Publishing Debtors that	
 
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 	were not previously assumed or rejected pursuant to Section 365 of the Bankruptcy Code or rejected pursuant to the Plan were deemed assumed by the applicable Reorganized Tribune Publishing Debtors or their successors-in-interest.	
 
 	—  	 	Distributions to Tribune Creditors : On the Effective Date (or as soon as practicable thereafter), (i) holders of allowed senior loan claims against Tribune and allowed senior loan guarantee claims against the subsidiary guarantors received approximately $2.9 billion in cash, approximately 98.2 million shares of Class A and Class B common stock in Reorganized Tribune Company (“New Common Stock”) and warrants to purchase New Common Stock (“New Warrants”) with an aggregate fair value determined pursuant to the Plan of approximately $4.5 billion as of the Effective Date, plus interests in a litigation trust formed pursuant to the Plan (the “Litigation Trust”), (ii) holders of allowed claims against Tribune related to Tribune’s prepetition $1.6 billion twelve-month bridge loan facility and allowed bridge loan facility guarantee claims against the subsidiary guarantors received a pro rata share of $64.5 million in cash (equal to approximately 3.98% of their allowed claim) plus interests in the Litigation Trust, (iii) holders of allowed general unsecured claims against the Tribune Publishing Debtors received cash in an amount equal to 100% of their allowed claim, and (iv) holders of unclassified claims, priority non-tax claims and certain other secured claims received cash in an amount equal to 100% of their allowed claim. All allowed priority tax and non-tax claims and other secured claims not paid on the Effective Date were reinstated and allowed administrative expense claims will be paid in full when due. All distributions to creditors related to the Tribune Publishing Debtors’ prepetition liabilities classified as liabilities subject to compromise were made by Tribune on behalf of the Tribune Publishing Debtors pursuant to Tribune’s centralized cash management system as described in Note 6.	
 
 	—  	 	Ownership Interests in the Tribune Publishing Debtors and Non-Debtor Subsidiaries : All ownership interests of Tribune in the Tribune Publishing Debtors and Non-Debtor Subsidiaries, after giving effect to the restructuring transactions described earlier, were reinstated on the Effective Date.	
 
 	—  	 	Other Plan provisions : The Plan and Confirmation Order also contain various discharges, injunctive provisions and releases that became operative on the Effective Date.	
Since the Effective Date, Reorganized Tribune Company has substantially consummated the various transactions contemplated under the Plan, including those provisions relating to the Tribune Publishing Debtors. In particular, Reorganized Tribune Company made all distributions of cash, including cash distributions made on behalf of the Tribune Publishing Debtors, New Common Stock and New Warrants that were required to be made under the terms of the Plan to creditors holding allowed claims. The prepetition claims of the Tribune Publishing Debtors’ general unsecured creditors that became or become allowed subsequent to the Effective Date have been or will be paid on the next quarterly distribution date after such allowance.
Prepetition Claims and Causes of Action —Under Section 362 of the Bankruptcy Code, the filing of a bankruptcy petition automatically stays most actions against a debtor, including most actions to collect prepetition indebtedness or to exercise control over the property of the debtor’s estate. Absent an order of the Bankruptcy Court, substantially all prepetition liabilities are subject to settlement under a plan of reorganization approved by the Bankruptcy Court. Shortly after commencing their Chapter 11 proceedings, the Debtors began notifying all known current or potential creditors of the Chapter 11 filings.
On March 23, 2009, the Tribune Publishing Debtors filed schedules with the Bankruptcy Court setting forth the assets and liabilities of the Tribune Publishing Debtors as of the Petition Date (as subsequently amended
 
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from time to time, the “Schedules of Assets and Liabilities”). These Schedules of Assets and Liabilities contain information identifying the Tribune Publishing Debtors’ executory contracts and unexpired leases, the creditors that may hold claims against the Tribune Publishing Debtors and the nature of such claims. On March 25, 2009, the Bankruptcy Court set June 12, 2009 as the general bar date, which was the final date by which most entities that wished to assert a prepetition claim against the Tribune Publishing Debtors were required to file a proof of claim in writing.
As required by ASC Topic 852, “Reorganizations” the amount of the liabilities subject to compromise at Dec. 30, 2012 represents Tribune Publishing’s best estimate of known or potential prepetition claims to be resolved in connection with the Tribune Publishing Debtors’ Chapter 11 cases. Such known or potential prepetition claims included certain proofs of claim filed against the Tribune Publishing Debtors and additional claims included in the Tribune Publishing Debtors’ respective Schedules of Assets and Liabilities filed with the Bankruptcy Court. Amounts and payment terms for these claims, if applicable, were established in the Plan. The filed proofs of claim asserted liabilities in excess of the amounts reflected in liabilities subject to compromise in Tribune Publishing’s combined balance sheets plus certain additional unliquidated and/or contingent amounts. During the Tribune Publishing Debtors’ Chapter 11 proceedings, the Tribune Publishing Debtors investigated the differences between the claim amounts recorded by the Tribune Publishing Debtors and claims filed by creditors. As of the Effective Date, a majority of the proofs of claim filed against the Tribune Publishing Debtors had been (i) settled or otherwise satisfied pursuant to the terms of the Plan or (ii) withdrawn, expunged or satisfied as a result of the Tribune Publishing Debtors’ evaluation of the filed proofs of claim and their efforts to reduce and/or eliminate invalid, duplicative and/or over-stated claims. As of the date of this filing, substantially all claims had been settled or otherwise satisfied pursuant to the terms of the Plan.
Pursuant to the terms of the Plan and subject to certain specified exceptions, on the Effective Date, all executory contracts or unexpired leases of the Tribune Publishing Debtors were deemed assumed in accordance with, and subject to, the provisions and requirements of Sections 365 and 1123 of the Bankruptcy Code. However, certain executory contracts and leases were previously assumed or rejected pursuant to Section 365 of the Bankruptcy Code.
Liabilities Subject to Compromise —Liabilities subject to compromise are shown separately in Tribune Publishing’s combined balance sheet at Dec. 30, 2012 and were incurred prior to the filing of the Chapter 11 Petitions. These amounts represent Tribune Publishing’s best estimate of known or potential prepetition claims to be resolved in connection with the Debtors’ Chapter 11 cases.
Tribune Publishing Debtors’ liabilities subject to compromise at Dec. 30, 2012 consisted of the following (in thousands):

 	  	Predecessor	 	
 	  	Dec. 30, 2012	 	
Accounts payable	  	$	32,030	  	
Deferred compensation and benefits	  	 	7,400	  	
Promissory demand notes due to Tribune Affiliate (including accrued interest of $22,860)	  	 	2,822,860	  	
Other liabilities (1)	  	 	3,600	  	
	  	 	 	 	
Tribune Publishing Debtors’ liabilities subject to compromise	  	$	2,865,890	  	

(1)	Other liabilities primarily include amounts for non-income taxes and other accrued expenses.	
 
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Prior to the Petition Date, Tribune Finance LLC (“Tribune Finance”), a subsidiary of Tribune, issued promissory demand notes aggregating $2.8 billion to certain Tribune Publishing Debtors. As of Dec. 30, 2012, these prepetition notes were in default due to the Chapter 11 filings. Prior to the Effective Date, any efforts to enforce these Debtors’ payment obligations pursuant to the promissory demand notes were stayed as a result of the filing of the Chapter 11 Petitions. As a result, these promissory demand notes are included in liabilities subject to compromise in Tribune Publishing’s combined balance sheets. See Note 6 for additional disclosures related to the Tribune Publishing Debtors’ obligations to Tribune Finance as of Dec. 30, 2012. In accordance with ASC Topic 852, following the Petition Date, Tribune Publishing ceased accruing interest expense on the promissory demand notes classified as liabilities subject to compromise. For the fiscal years ended Dec. 30, 2012 and Dec. 25, 2011, contractual interest expense applicable to the promissory demand notes was approximately $92.0 million and $90.3 million, respectively, while reported interest expense was less than $0.1 million in 2012 and $0 in 2011. Accrued interest on the promissory demand notes was also classified in liabilities subject to compromise and amounted to $22.9 million at Dec. 30, 2012.
On the Effective Date, substantially all of the Debtors’ prepetition liabilities at Dec. 30, 2012 were settled or otherwise satisfied under the Plan. However, certain other claims have been or will be settled or otherwise satisfied subsequent to the Effective Date. Although the allowed amount of certain unresolved claims has not been determined, Tribune Publishing’s liabilities subject to compromise associated with these unresolved claims were discharged upon emergence from Chapter 11 in exchange for the treatment outlined in the Plan. For information regarding the discharge of liabilities subject to compromise, see the “Terms of the Plan” section above.
Reorganization Items, Net —Reorganization items, net generally include provisions and adjustments to reflect the carrying value of certain prepetition liabilities at their estimated allowable claim amounts and, pursuant to ASC Topic 852, are reported separately in Tribune Publishing’s combined statements of comprehensive income. Reorganization items, net may also include professional advisory fees and other costs directly associated with the Debtors’ Chapter 11 cases, however, all professional advisory fees that were paid by Tribune and other non-debtor Tribune Affiliates that related to all Debtors have not been allocated to Tribune Publishing as professional advisory fees are Tribune reorganization expenses and do not specifically relate to the operations of Tribune Publishing.
Specifically identifiable reorganization provisions, adjustments and other costs directly related to Tribune Publishing have been included in the Successor’s combined statement of comprehensive income for 2013 and in the Predecessor’s combined statements of comprehensive income for Dec. 31, 2012 and for 2012 and 2011 and consisted of the following items (in thousands):

 	  	Successor	 	 	   	  	Predecessor	 	
 	  	2013	 	 	   	  	Dec. 31, 2012	 	 	2012	 	 	2011	 	
Reorganization costs, net:	  				 	 	  				 				 				
Contract rejections and claim settlements	  	$	111	  	 	 	  	$	—	  	 	$	(978	) 	 	$	412	  	
Other, net	  	 	(381	) 	 	 	  	 	—	  	 	 	(468	) 	 	 	(2	) 	
	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total reorganization (costs) credits, net	  	 	(270	) 	 	 	  	 	—	  	 	 	(1,446	) 	 	 	410	  	
Reorganization adjustments, net	  	 	—	  	 	 	  	 	2,862,039	  	 	 	             —	  	 	 	            —	  	
Fresh-start reporting adjustments, net	  	 	—	  	 	 	  	 	(107,486	) 	 	 	—	  	 	 	—	  	
	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total reorganization items, net	  	$	(270	) 	 	 	  	$	2,754,553	  	 	$	(1,446	) 	 	$	410	  	
	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
In 2009, Tribune Publishing recorded provisions to establish liabilities for estimated claims incurred for certain non-cancellable operating leases rejected in the Tribune Publishing Debtors’ Chapter 11 cases. Contract
 
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rejections and claim settlements included in reorganization items, net, in 2011 reflect gains associated with the reversal of the provisions made in 2009 to establish liabilities for rejected operating leases as the Tribune Publishing Debtors determined that no valid proofs of claim for those rejected leases had been filed with the Bankruptcy Court. Accordingly, such provisions made in 2009 were reversed in 2011 as these determinations were made. In the third quarter of 2012, the Plan was confirmed which, among other things, resulted in the allowance of, or adjustments to, certain claims that were otherwise contingent upon the confirmation of the Plan. As a result, contract rejections and claim settlements in 2012 included losses to adjust certain employee-related claims pursuant to a settlement agreement. These losses were partially offset by net favorable adjustments to adjust other liabilities to the amount of the allowed claim.
The Predecessor’s combined statement of comprehensive income for Dec. 31, 2012 included other reorganization items totaling $2.755 billion before taxes ($2.842 billion after taxes) arising from reorganization and fresh-start reporting adjustments. Reorganization adjustments, which were recorded to reflect the settlement of prepetition liabilities and changes in the Predecessor’s capital structure arising from the implementation of the Plan, resulted in a net reorganization gain of $2.862 billion before taxes ($2.894 billion after taxes). Fresh-start reporting adjustments, which were recorded as a result of the adoption of fresh-start reporting as of the Effective Date in accordance with ASC Topic 852, resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). The net gain resulted primarily from adjusting the Predecessor’s net carrying values for certain assets and liabilities to their fair values in accordance with ASC Topic 805, “Business Combinations,” recording related adjustments to deferred income taxes and eliminating the Predecessor’s accumulated other comprehensive income (loss) as of the Effective Date. See Note 3 for additional information regarding these other reorganization items.
Tribune Publishing expects to incur certain expenses pertaining to the Chapter 11 proceedings throughout 2014 and potentially in future periods.
NOTE 3: FRESH-START REPORTING
Financial Statement Presentation —Reorganized Tribune Company adopted fresh-start reporting on the Effective Date in accordance with ASC Topic 852. All conditions required for the adoption of fresh-start reporting were satisfied by Reorganized Tribune Company on the Effective Date as (i) the ESOP, the holder of all of Tribune’s voting shares immediately before confirmation of the Plan, did not receive any voting shares of Reorganized Tribune Company or any other distributions under the Plan, and (ii) the reorganization value of Tribune’s assets were less than the postpetition liabilities and allowed prepetition claims. As a result, Tribune Publishing also adopted fresh-start reporting on the Effective Date.
The adoption of fresh-start reporting by Reorganized Tribune Publishing resulted in a new reporting entity for financial reporting purposes reflecting the Successor’s capital structure as of the Effective Date. Any presentation of Reorganized Tribune Publishing’s combined financial statements as of and for periods subsequent to the Effective Date represents the financial position, results of operations and cash flows of a new reporting entity and will not be comparable to any presentation of the Predecessor’s combined financial statements as of and for periods prior to the Effective Date, and the adoption of fresh-start reporting. The accompanying combined financial statements as of and for the years ended Dec. 30, 2012 and Dec. 25, 2011 have not been adjusted to reflect any changes in the Predecessor’s capital structure as a result of the Plan nor have they been adjusted to reflect any changes in the fair value of assets and liabilities as a result of the adoption of fresh-start reporting.
In accordance with ASC Topic 852, the Predecessor’s combined statement of comprehensive income for Dec. 31, 2012 includes only (i) reorganization adjustments which resulted in a net gain of $2.862 billion before
 
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taxes ($2.894 billion after taxes) and (ii) fresh-start reporting adjustments which resulted in a net loss of $107.5 million before taxes ($52.1 million after taxes). These adjustments are further summarized and described below. The Predecessor’s combined statements of comprehensive income and cash flows for Dec. 31, 2012 exclude the results of operations and cash flows arising from the Predecessor’s business operations on Dec. 31, 2012. Because the Predecessor’s Dec. 31, 2012 results of operations and cash flows were not material, Reorganized Tribune Publishing has elected to report them as part of Reorganized Tribune Publishing’s results of operations and cash flows for the first quarter of 2013.
Enterprise Value/Reorganization Value —ASC Topic 852 requires, among other things, a determination of the reorganization value for Reorganized Tribune Company and allocation of such reorganization value, as of the Effective Date, to the fair value of Reorganized Tribune Company’s tangible assets, finite-lived intangible assets and indefinite-lived intangible assets in accordance with the provisions of ASC Topic 805. The reorganization value for Reorganized Tribune Company represents the amount of resources available, or that become available, for the satisfaction of postpetition liabilities and allowed prepetition claims, as negotiated between the debtors and their creditors. This value is viewed as the fair value of Reorganized Tribune Company before considering liabilities and is intended to approximate the amount a willing buyer would pay for the assets of Reorganized Tribune Company immediately after emergence from bankruptcy. In connection with the Debtors’ Chapter 11 cases, the Debtors’ financial advisor undertook a valuation analysis to determine the value available for distribution to holders of allowed prepetition claims. The distributable value of Reorganized Tribune Company was determined utilizing a combination of enterprise valuation methodologies, including a comparable company analysis, a discounted cash flow (“DCF”) analysis and a precedent transaction analysis, plus the estimated cash on hand as of the measurement date and the estimated fair value of Tribune Company’s investments. The enterprise valuation methodologies are further described in the “Methodology, Analysis and Assumptions” section below. Based on current and anticipated economic conditions and the direct impact of these conditions on Reorganized Tribune Company’s business, this analysis estimated a range of distributable value from the Debtors’ estates from $6.917 billion to $7.826 billion with an approximate mid-point of $7.372 billion. The confirmed Plan contemplates a distributable value for Reorganized Tribune Company of $7.372 billion. The distributable value implies an equity value for Reorganized Tribune Company of $4.536 billion after reducing the distributable value for cash distributed (or to be distributed) pursuant to the Plan and $1.100 billion of new debt undertaken by Reorganized Tribune Company.
In accordance with the provisions of ASC Topic 805, the reorganization value of Reorganized Tribune Company was allocated, in part, to the fair value of Reorganized Tribune Publishing’s tangible assets, finite-lived intangible assets and indefinite-lived intangible assets as of the Effective Date. The calculation of reorganization value is further described in the “Fresh-Start Condensed Combined Balance Sheet” section below.
Methodology, Analysis and Assumptions —The comparable company valuation analysis methodology estimates the enterprise value of a company based on a relative comparison with publicly traded companies with similar operating and financial characteristics to the subject company. Under this methodology, Tribune’s financial advisor determined a range of multiples of revenues and earnings before interest, taxes, depreciation and amortization (“EBITDA”) to calculate the enterprise values of Tribune’s publishing and broadcasting segments. The DCF analysis is a forward-looking enterprise valuation methodology that estimates the value of an asset or business by calculating the expected future cash flows to be generated by that asset or business. Under this methodology, projected future cash flows are discounted by the enterprise’s weighted average cost of capital (“WACC”). The WACC reflects the estimated blended rate of return that would be required by debt and equity investors to invest in the enterprise based on its capital structure. Utilizing the DCF analysis, the enterprise values of Tribune’s publishing and broadcasting segments were determined by calculating the present value of the projected unlevered after-tax free cash flows through 2015 plus an estimate for the value of each segment for the period beyond 2015 known as the terminal value. The terminal value was derived by either applying a
 
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multiple to the projected EBITDA for the final year of the projection period (2015) or capitalizing the projected unlevered after-tax free cash flow in the same projection period using the WACC and an assumed perpetual growth rate, discounted back to the valuation date using the WACC, as appropriate. The precedent transactions valuation methodology is based on the enterprise values of companies involved in public merger and acquisition transactions that have operating and financial characteristics similar to the subject company. Under this methodology, the enterprise value is determined by an analysis of the consideration paid and the debt assumed in the identified merger and acquisition transactions and is usually expressed as a multiple of revenues or EBITDA. Utilizing this analysis, Tribune’s financial advisor determined a range of multiples of EBITDA for the trailing 12 months from the measurement date to calculate the enterprise value for Tribune’s broadcasting segment. The precedent transactions valuation methodology was not used for Tribune’s publishing segment due to the lack of relevant transactions.
Tribune’s financial advisor applied a weighted average of the above enterprise valuation methodologies to calculate the estimated ranges of enterprise values for Tribune’s publishing and broadcasting segments. The relative weighting of each valuation methodology was based on the amount of publicly available information to determine the inputs used in the calculations. In addition, Tribune’s financial advisor utilized a combination of these enterprise valuation methodologies, primarily the comparable company valuation analysis methodology, to calculate the estimated ranges of fair values of Tribune’s investments. The ranges of enterprise values for Tribune’s publishing and broadcasting segments and estimated fair values of Tribune’s investments were added to the estimated cash on hand as of the measurement date to determine the estimated range of distributable value noted above.
 
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Fresh-Start Combined Balance Sheet —The table below summarizes the Predecessor’s Dec. 30, 2012 combined balance sheet, the reorganization and fresh-start reporting adjustments that were made to that balance sheet as of Dec. 31, 2012, and the resulting Successor’s combined balance sheet as of Dec. 31, 2012.
Combined Balance Sheets at Dec. 30, 2012 and Dec. 31, 2012
(In thousands)

 	 	Predecessor
At Dec. 30, 2012	 	 	Reorganization
Adjustments	 	 	Fresh-Start
Adjustments	 	 	Successor
At Dec. 31, 2012	 	
Assets	 				 				 				 				
Current Assets	 				 				 				 				
Cash	 	$	13,768	  	 	$	—	  	 	$	—	  	 	$	13,768	  	
Accounts receivable, net	 	 	256,985	  	 	 	—	  	 	 	—	  	 	 	256,985	  	
Inventories	 	 	12,537	  	 	 	—	  	 	 	5,810	  (4)  	 	 	18,347	  	
Deferred income taxes	 	 	1,147	  	 	 	42,228	  (1)(2)  	 	 	(2,272	) (4)  	 	 	41,103	  	
Prepaid expenses and other	 	 	14,733	  	 	 	—	  	 	 	(18	) (4)  	 	 	14,715	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current assets	 	 	299,170	  	 	 	42,228	  	 	 	3,520	  	 	 	344,918	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Properties	 				 				 				 				
Property, plant and equipment	 	 	1,938,208	  	 	 	—	  	 	 	(1,527,106	) (4)  	 	 	411,102	  	
Accumulated depreciation	 	 	(1,322,830	) 	 	 	—	  	 	 	1,322,830	  (4)  	 	 	—	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net properties	 	 	615,378	  	 	 	—	  	 	 	(204,276	) 	 	 	411,102	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Assets	 				 				 				 				
Goodwill	 	 	—	  	 	 	—	  	 	 	15,331	  (4)  	 	 	15,331	  	
Other intangible assets, net	 	 	28,911	  	 	 	—	  	 	 	37,976	  (4)  	 	 	66,887	  	
Investments	 	 	3,986	  	 	 	—	  	 	 	—	  	 	 	3,986	  	
Deferred income taxes	 	 	—	  	 	 	—	  	 	 	54,188	  (4)  	 	 	54,188	  	
Other	 	 	3,787	  	 	 	—	  	 	 	(2,402	) (4)  	 	 	1,385	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total other assets	 	 	36,684	  	 	 	—	  	 	 	105,093	  	 	 	141,777	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total assets	 	$	951,232	  	 	$	42,228	  	 	$	(95,663	) 	 	$	897,797	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Liabilities and Shareholder’s Equity (Deficit)	 				 				 				 				
Current Liabilities	 				 				 				 				
Accounts payable	 	$	37,710	  	 	$	2,528	  (1)(3)  	 	$	—	  (4)  	 	$	40,238	  	
Employee compensation and benefits	 	 	103,077	  	 	 	322	  (1)(3)  	 	 	—	  	 	 	103,399	  	
Deferred revenue	 	 	66,835	  	 	 	—	  	 	 	(171	) (4)  	 	 	66,664	  	
Other current liabilities	 	 	26,359	  	 	 	(879	) (1)(3)  	 	 	—	  	 	 	25,480	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current liabilities	 	 	233,981	  	 	 	1,971	  	 	 	(171	) 	 	 	235,781	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Non-Current Liabilities	 	 	66,300	  	 	 	11,679	  (1)(2)(3)  	 	 	(16,192	) (4)  	 	 	61,787	  	
Liabilities Subject to Compromise	 	 	2,865,890	  	 	 	(2,865,890	) (1)(3)  	 	 	—	  	 	 	—	  	
Equity (Deficit)	 	 	(2,214,939	) 	 	 	2,894,468	  (1)  	 	 	(79,300	) (4)  	 	 	600,229	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total liabilities and equity (deficit)	 	$	951,232	  	 	$	42,228	  	 	$	(95,663	) 	 	$	897,797	  	

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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
 	(1)	Reflects adjustments arising from implementation of the Plan, including the gain on the settlement of prepetition liabilities, distributions of cash by Tribune on behalf of Reorganized Tribune Publishing and the elimination of Tribune Publishing’s equity (deficit). These adjustments also include the establishment of Reorganized Tribune Publishing’s equity based on the reorganization value of Reorganized Tribune Company allocated to the fair value of Reorganized Tribune Publishing’s tangible assets, finite-lived intangible assets and indefinite-lived intangible assets as of the Effective Date. The changes in the Predecessor’s capital structure arising from the implementation of the Plan is comprised of the following adjustments (in thousands):	

Liabilities subject to compromise on the Effective Date	  	$	 2,865,890	  	
Less: Liabilities assumed and reinstated on the Effective Date	  	 	(2,909	) 	
Less: Liabilities for prepetition claims to be settled subsequent to the Effective Date and other adjustments	  	 	(5,472	) 	
	  	 	 	 	
Liabilities subject to compromise settled on the Effective Date	  	 	2,857,509	  	
Forgiveness of prepetition promissory notes held by parent	  	 	2,822,860	  	
Cash distributions on settled claims paid by parent	  	 	34,649	  	
	  	 	 	 	
Gain on settlement of liabilities subject to compromise	  	 	2,857,509	  	
Plus: Other reorganization adjustments, net	  	 	4,530	  	
	  	 	 	 	
Total reorganization adjustments before taxes	  	 	2,862,039	  	
Plus: Income tax benefit on reorganization adjustments	  	 	32,429	  	
	  	 	 	 	
Net reorganization gain after taxes	  	$	2,894,468	  	

 	(2)	Reflects the conversion of Reorganized Tribune Company, including its qualified subchapter S subsidiaries, from a subchapter S corporation to a C corporation under the IRC.	
 	(3)	Reflects the reclassification of certain liabilities from liabilities subject to compromise upon the assumption of certain executory contracts and unexpired leases.	
 	(4)	The Predecessor’s combined statement of comprehensive income for Dec. 31, 2012 includes certain adjustments recorded as a result of the adoption of fresh-start reporting in accordance with ASC Topic 852 as of the Effective Date. These fresh-start reporting adjustments resulted in a net pretax loss which primarily resulted from adjusting the Predecessor’s recorded values for certain assets and liabilities to fair values in accordance with ASC Topic 805, and recording related adjustments to deferred income taxes. The fresh-start reporting adjustments included in the Predecessor’s statement of comprehensive income for Dec. 31, 2012 consisted of the following items (in thousands):	

Fair value adjustments to net properties	  	$	(204,276	) 	
Fair value adjustments to intangibles	  	 	37,431	  	
Establish Successor’s goodwill	  	 	15,331	  	
Elimination of accumulated other comprehensive income	  	 	       33,598	  	
Other fair value adjustments, net	  	 	10,430	  	
	  	 	 	 	
Loss from fresh-start reporting adjustments before taxes	  	 	(107,486	) 	
Income tax benefit attributable to fair value adjustments	  	 	55,344	  	
	  	 	 	 	
Net loss from fresh-start reporting adjustments after taxes	  	$	(52,142	) 	
	  	 	 	 	
Property, Plant and Equipment —Property, plant and equipment was adjusted to a fair value aggregating $411.1 million as of the Effective Date. The fair values of property, plant and equipment were based primarily on valuations obtained from third party valuation specialists principally utilizing the cost and market valuation approaches.
Fresh-start reporting adjustments included the elimination of the Predecessor’s aggregate accumulated depreciation balance as of Dec. 30, 2012.
Identifiable Intangible Assets —The following intangible assets were identified by Reorganized Tribune Publishing and recorded at fair value based on valuations obtained from third party valuation specialists: newspaper mastheads, advertiser relationships, customer relationships, affiliate agreements and other contracts and agreements, including real property leases. The cost, income and market valuation approaches were utilized, as appropriate, to estimate the fair values of these intangible assets. The determination of the fair values of these identifiable intangible assets resulted in a $38.0 million net increase in other intangible assets in the Successor’s combined balance sheet at Dec. 31, 2012.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
NOTE 4: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates —The preparation of these combined financial statements in conformity with U.S. GAAP requires management to make use of estimates and assumptions that affect the reported amount of assets and liabilities, revenues and expenses and certain financial statement disclosures. Some of the significant estimates in these combined financial statements include the valuation assumptions used in the adoption of fresh-start reporting, allowances for doubtful accounts receivable, net realizable value of inventories, corporate allocations, useful lives of property and identifiable intangible assets, the evaluation of recoverability of property and identifiable intangible assets, income tax and valuation reserves. Actual results could differ from these estimates.
Revenue Recognition —Tribune Publishing’s primary sources of revenue are from the sales of advertising space in published issues of its newspapers and other publications and on websites owned by, or affiliated with Tribune Publishing; distribution of preprinted advertising inserts in its publications; sales of newspapers and other publications to distributors and individual subscribers; and the provision of commercial printing and delivery services to third parties, primarily other newspaper companies. Newspaper advertising revenue is recorded, net of agency commissions, when advertisements are published in newspapers. Website advertising revenue is recognized ratably over the contract period or as services are delivered, as appropriate. Commercial printing and delivery services revenues, which are included in other revenues, are recognized when the product is delivered to the customer or as services are provided, as appropriate. Proceeds from publication subscriptions are deferred and are included in revenue on a pro rata basis over the term of the subscriptions. Tribune Publishing records rebates when earned as a reduction of advertising revenue.
Cash —Cash is stated at cost, which approximates market value. Tribune utilizes a centralized approach to cash management and the financing of its operations. Cash in the combined balance sheets represents either cash not yet advanced to Tribune or cash held locally by Tribune Publishing. See Note 6 for further discussion.
Accounts Receivable and Allowance for Doubtful Accounts —Tribune Publishing’s accounts receivable are primarily due from advertisers and circulation-related accounts. Credit is extended based on an evaluation of each customer’s financial condition, and generally collateral is not required. Tribune Publishing maintains an allowance for uncollectible accounts, rebates and volume discounts. The allowance for uncollectible accounts is determined based on historical write-off experience and any known specific collectability exposures.
A summary of the activity with respect to the accounts receivable allowances is as follows (in thousands):

Accounts receivable allowance balance at Dec. 25, 2011 (Predecessor)	  	$	13,519	  	
2012 additions charged to costs and expenses	  	 	23,387	  	
2012 deductions	  	 	(23,475	) 	
	  	 	 	 	
Accounts receivable allowance balance at Dec. 30, 2012 (Predecessor)	  	$	13,431	  	
2013 additions charged to costs and expenses	  	 	22,477	  	
2013 deductions	  	 	(23,052	) 	
	  	 	 	 	
Accounts receivable allowance balance at Dec. 29, 2013 (Successor)	  	$	12,856	  	
	  	 	 	 	
Trade Transactions —Tribune Publishing, in the ordinary course of business, enters into trade transactions whereby advertising in a Tribune Publishing publication is exchanged for products or services or advertising, including advertising at an event/venue. Trade transactions are generally reported at the estimated fair value of the product or services received. Revenues are recorded when the advertisement runs in a Tribune Publishing publication and expenses are generally recorded when the products or services are utilized or the advertisement runs.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Inventories —Inventories are stated at the lower of cost or market. The Predecessor determined cost on the last-in, first-out (“LIFO”) basis for newsprint and on the first-in, first-out (“FIFO”) basis for all other inventories. Effective Dec. 31, 2012 and in conjunction with the adoption of fresh-start reporting, Reorganized Tribune Publishing elected to change its costing method to the FIFO method for newsprint inventories. In addition, effective Dec. 31, 2012, Reorganized Tribune Publishing elected to change its accounting policy whereby ink, spare parts and other consumables used in production are expensed upon acquisition and no longer recorded into inventory in the Successor’s combined balance sheet.
Properties —Property, plant and equipment of the Predecessor are stated at cost less accumulated depreciation. The Predecessor computed depreciation using the straight-line method over the following estimated useful lives: 10 to 40 years for buildings, 7 to 20 years for newspaper printing presses and 3 to 10 years for all other equipment. As a result of the adoption of fresh-start reporting, Reorganized Tribune Publishing’s property, plant and equipment was adjusted to fair value on the Effective Date. In addition, the estimated useful lives of Reorganized Tribune Publishing’s property, plant and equipment that were in service on the Effective Date were revised to the following: 4 to 44 years for buildings, 1 to 25 years for newspaper printing presses and 1 to 25 years for all other equipment. There were no changes to the methods used by Reorganized Tribune Publishing to compute depreciation or any changes to the policy for determining estimated useful lives for assets placed into service subsequent to the Effective Date as a result of the adoption of fresh-start reporting. Expenditures for repairs and maintenance of existing assets are charged to expense as incurred. Property, plant and equipment assets that are financed under a capital lease are depreciated over the shorter of the term of the lease or the useful lives of the assets.
Goodwill and Other Intangible Assets —Goodwill and other intangible assets are summarized in Note 8. Tribune Publishing reviews goodwill and other indefinite-lived intangible assets, which include only newspaper mastheads, for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles–Goodwill and Other.” Under ASC Topic 350, the impairment review of goodwill and other intangible assets not subject to amortization must be based on estimated fair values.
Tribune Publishing’s annual impairment review measurement date is in the fourth quarter of each year. The estimated fair value of goodwill is determined using many critical factors, including projected future operating cash flows, revenue and market growth, market multiples, discount rates and consideration of market valuations of comparable companies. The estimated fair values of other intangible assets subject to the annual impairment review are calculated based on projected future discounted cash flow analyses. The development of estimated fair values requires the use of assumptions, including assumptions regarding revenue and market growth as well as specific economic factors in the publishing industry such as operating margins and royalty rates for newspaper mastheads. These assumptions reflect Tribune Publishing’s best estimates, but these items involve inherent uncertainties based on market conditions generally outside of Tribune Publishing’s control.
Adverse changes in expected operating results and/or unfavorable changes in other economic factors used to estimate fair values could result in non-cash impairment charges in the future under ASC Topic 350.
Impairment Review of Long-Lived Assets —In accordance with ASC Topic 360, “Property, Plant and Equipment,” Tribune Publishing evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may be impaired. The carrying value of a long-lived asset or asset group is considered impaired when the projected future undiscounted cash flows to be generated from the asset or asset group over its remaining depreciable life are less than its current carrying value. Tribune Publishing measures impairment based on the amount by which the carrying value exceeds the estimated fair value of the long-lived asset or asset group. The fair value is
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
determined primarily by using the projected future cash flows discounted at a rate commensurate with the risk involved as well as market valuations. Losses on long-lived assets to be disposed of are determined in a similar manner, except that the fair values are reduced for an estimate of the cost to dispose or abandon.
Adverse changes in expected operating results and/or unfavorable changes in other economic factors used to estimate future undiscounted cash flows could result in non-cash impairment charges in the future under ASC Topic 360.
Fair Value Measurements —Tribune Publishing measures and records in its combined financial statements certain assets and liabilities at fair value. ASC Topic 820, “Fair Value Measurement and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and Tribune Publishing’s own assumptions (unobservable inputs). This hierarchy consists of the following three levels:
 
 	—  	 	Level 1—Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market.	
 
 	—  	 	Level 2—Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets; or valuation models whose inputs are observable or unobservable but corroborated by market data.	
 
 	—  	 	Level 3—Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable inputs that are significant to the overall fair value measurement.	
At both Dec. 29, 2013 and Dec. 30, 2012, Tribune Publishing had no financial assets or liabilities that are measured at fair value on a recurring basis.
Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).
The carrying values of cash, trade accounts receivable and trade accounts payable approximate fair value due to their short term to maturity.
Liabilities subject to compromise at Dec. 30, 2012 included certain prepetition promissory demand notes due to Tribune Finance which had a carrying value of $2.8 billion. The amounts and payment terms of these promissory demand notes were established in connection with the Plan. Accordingly, the fair value of these related party liabilities could not be reasonably estimated at Dec. 30, 2012 as they were not arm’s length transactions and therefore, such amounts were not meaningful.
Investments —Investments in unconsolidated affiliates over which Tribune Publishing exercises significant influence, but does not control, are accounted for by the equity method. Under this method, an investment account for each unconsolidated affiliate is increased by contributions made and by Tribune Publishing’s share of net income of the unconsolidated affiliate, and decreased by the share of net losses of and distributions from the unconsolidated affiliate. See Note 9 for further discussion.
Tribune Pension Plans and Other Postretirement Benefits —Retirement benefits are provided to eligible employees of Tribune Publishing through defined benefit pension plans sponsored by Tribune. Under
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Tribune-sponsored defined benefit pension plans, pension benefits are primarily a function of both the years of service and the level of compensation for a specified number of years, depending on the plan. It is Tribune’s policy to fund the minimum for Tribune-sponsored defined benefit pension plans as required by the Employee Retirement Income Security Act (“ERISA”). Contributions made to union-sponsored plans are based upon collective bargaining agreements.
Tribune also provides certain health care and life insurance benefits for retired Tribune Publishing employees through postretirement benefit plans sponsored by Tribune. The expected cost of providing these benefits is accrued over the years that the employees render services. It is Tribune’s policy to fund postretirement benefits as claims are incurred.
Retirement benefits obligations pursuant to the Tribune-sponsored defined benefit pension plans have historically been and will continue to be an obligation of Tribune. Therefore, Tribune Publishing accounts for costs associated with these defined benefit pension plans as a participant in multi-employer plans in accordance with ASC Topic 715, “Compensation—Retirement Benefits.” ASC Topic 715 provides that an employer that participates in a multi-employer defined benefit plan is not required to report a liability beyond the contributions currently due and unpaid to the plan. As no such amounts are due and unpaid by Tribune Publishing, no assets or liabilities relative to the obligations under the Tribune-sponsored defined benefit pension plans have been included in the combined balance sheets.
Tribune recognizes the overfunded or underfunded status of its postretirement benefit plans as an asset or liability in its consolidated balance sheets and recognizes changes in that funded status in the year in which changes occur through comprehensive income (loss). The portions of the liabilities for postretirement health care and life insurance benefits, the related net periodic benefit costs and other comprehensive income (loss) have been allocated to Tribune Publishing and presented within these combined financial statements. The amounts included within these combined financial statements were actuarially determined based on amounts allocable to eligible Tribune Publishing employees.
Self-Insurance —Tribune self-insures for certain employee medical and disability income benefits, and insures with a high deductible for workers’ compensation, automobile and general liability claims. The recorded liabilities for self-insured risks are calculated using actuarial methods and are not discounted. Tribune’s deductibles for the insured coverages are generally $1 million per occurrence, depending on the applicable policy period. As a portion of the liabilities and expense related to these self-insurance and insurance plans relate to Tribune Publishing employees, both the liability and expense applicable to those employees have been presented within these financial statements. The recorded liabilities for self-insured risks at Dec. 29, 2013 and Dec. 30, 2012 totaled $47.5 million and $47.8 million, respectively, and included $0.1 million classified as liabilities subject to compromise at Dec. 30, 2012.
Deferred Revenue —Deferred revenue arises in the normal course of business from advance subscription payments for newspapers and other publications, and interactive advertising sales. Deferred revenue is recognized in the period it is earned.
Income Taxes —On March 13, 2008, Tribune filed an election to be treated as a subchapter S corporation under the IRC, with the election effective as of the beginning of Tribune’s 2008 fiscal year. Tribune also elected to treat nearly all of its subsidiaries, including the subsidiaries through which Tribune Publishing operates, as qualified subchapter S subsidiaries. Subject to certain limitations (such as built-in-gains tax applicable for ten years to gains accrued prior to the election), Tribune and Tribune Publishing were not subject to federal income tax. Although most states in which Tribune and Tribune Publishing operate recognize subchapter S corporation status, some impose tax at a reduced rate. Certain Tribune Publishing non-qualified subchapter S subsidiaries were subject to federal and state income taxes as C corporations.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
For the purposes of these combined financial statements, Tribune Publishing has computed income taxes as if it were filing separate returns. Current income taxes payable are settled with Tribune through the equity (deficit) account.
Provisions for federal and state income taxes are calculated on reported pretax earnings based on current tax laws and also include, in the current period, the cumulative effect of any changes in tax rates from those used previously in determining deferred income tax assets and liabilities. Taxable income reported to the taxing jurisdictions in which Tribune Publishing operates often differs from pretax earnings because some items of income and expense are recognized in different time periods for income tax purposes. Tribune Publishing provides deferred taxes on these temporary differences in accordance with ASC Topic 740, “Accounting for Income Taxes.” Taxable income also may differ from pretax earnings due to statutory provisions under which specific revenues are exempt from taxation and specific expenses are not allowable as deductions. The combined tax provision and related accruals include estimates of the potential taxes and related interest as deemed appropriate. These estimates are reevaluated and adjusted, if appropriate, on a quarterly basis. Although management believes its estimates and judgments are reasonable, the resolution of Tribune Publishing’s tax issues are unpredictable and could result in tax liabilities that are significantly higher or lower than that which has been provided by Tribune Publishing.
ASC Topic 740 addresses the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Under ASC Topic 740, a company may recognize the tax benefit of an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. ASC Topic 740 requires the tax benefit recognized in the financial statements to be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC Topic 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure. See Note 11 for further discussion.
In connection with the Debtors’ emergence from Chapter 11, Reorganized Tribune Company converted from a subchapter S corporation to a C corporation under the IRC, including the qualified subchapter S subsidiaries included in these combined financial statements. The effect of this conversion was recorded in connection with Reorganized Tribune Publishing’s implementation of fresh-start reporting as more fully described in Note 3 and Note 11. Accordingly, essentially all of Reorganized Tribune Publishing’s deferred income tax assets and liabilities at the Effective Date were reinstated at a higher effective tax rate.
New Accounting Standards —In February 2013, the FASB issued ASU No. 2013-02, “Comprehensive Income (Topic 220): Reporting Amounts Reclassified Out of Accumulated Other Comprehensive Income.” ASU No. 2013-02 requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. ASU No. 2013-02 is required to be applied prospectively in interim and annual periods beginning after Dec. 15, 2012. Adoption of ASU No. 2013-02 did not have a material impact on Tribune Publishing’s combined financial statements.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
NOTE 5: CHANGES IN OPERATIONS
Acquisitions —Tribune Publishing made no business acquisitions in 2013 and 2012. Business acquisitions in 2011 were not significant. The results of acquired companies are included in the combined statements of comprehensive income since their respective dates of acquisition.
Employee Reductions —Tribune Publishing identified reductions in its staffing levels in 2013, 2012 and 2011 of approximately 745, 800 and 560 positions, respectively. As a result, Tribune Publishing recorded pretax charges for severance and related expenses totaling $15.6 million, $13.6 million, and $14.1 million in 2013, 2012 and 2011, respectively. On Nov. 20, 2013, Tribune announced that it would be undertaking certain actions to realign the non-editorial functions across Tribune Publishing to increase the efficiency and effectiveness of its operations. In the fourth quarter of 2013, Tribune Publishing recorded pretax charges for severance and related expenses totaling $9.1 million for identified reductions in staffing levels of approximately 400 positions which were due in part to these actions as well as other cost reduction initiatives. The accrued liability for severance and related expenses is reflected in employee compensation and benefits in the combined balance sheets and was $9.3 million at Dec. 29, 2013 and $4.0 million at Dec. 30, 2012.
A summary of the activity with respect to Tribune Publishing’s severance accrual is as follows (in thousands):

Severance accrual balance at Dec. 25, 2011(Predecessor)	  	$	5,583	  	
2012 provision	  	 	13,558	  	
2012 payments	  	 	(15,140	) 	
	  	 	 	 	
Severance accrual balance at Dec. 30, 2012 (Predecessor)	  	 	4,001	  	
2013 provision	  	 	15,592	  	
2013 payments	  	 	(10,257	) 	
	  	 	 	 	
Severance accrual balance at Dec. 29, 2013 (Successor)	  	$	9,336	  	
	  	 	 	 	
Charges for severance and related expenses are included in selling, general and administrative expense in the accompanying combined statements of comprehensive income. Severance expense in the table above, excludes severance costs incurred by Tribune and Tribune Affiliates and allocated to Tribune Publishing. See Note 6 for further discussion of allocated charges from Tribune and Tribune Affiliates.
Shutdown of Daily Press Media Group Printing and Packing Operations —In April 2012, the Daily Press Media Group (“DPMG”) approved a plan to outsource DPMG’s printing and packaging operations located in Newport News, Virginia to Media General Operations, Inc. (d/b/a Richmond Times-Dispatch ) (“MG”). Pursuant to the arrangement, MG will provide to DPMG prepress, printing, inserting, newsprint and transportation services for all editions of DPMG’s three newspapers, the Daily Press, The Virginia Gazette, and the Tidewater Review . As of April 27, 2012, the DPMG facility had certain press equipment, prepress equipment and machinery with a net book value of $5.8 million that would no longer be used as a result of the arrangement. Of this amount, inserting equipment with a net book value of $1.5 million was made available to MG for use in connection with contracted print and packaging activities, equipment with a net book value of $1.2 million was transferred to other publishing business units and equipment with a net book value of $3.1 million was sold or scrapped. Accordingly, Tribune Publishing reduced its estimate of the remaining useful life of the equipment to be sold or scrapped and recorded accelerated depreciation of $2.8 million during 2012. Pursuant to the arrangement, DPMG reimbursed MG for the purchase and installation of necessary press modification equipment and systems in the amount of $0.7 million. In addition, Tribune Publishing eliminated approximately 85 employees and incurred severance and related expenses of $0.7 million which are included in selling, general and administrative expenses in Tribune Publishing’s combined statements of comprehensive income.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
NOTE 6: RELATED PARTY TRANSACTIONS WITH TRIBUNE AND TRIBUNE AFFILIATES
Tribune Publishing participates in a number of corporate-wide programs administered by Tribune and Tribune Affiliates. These include participation in Tribune’s centralized treasury function, insurance programs, employee benefit programs, workers’ compensation programs and centralized service centers and other corporate functions. The following is a discussion of the relationship with Tribune, the services provided and how transactions with Tribune and Tribune Affiliates have been accounted for in the combined financial statements.
Equity (Deficit) —Equity (Deficit) in the combined balance sheets includes the accumulated balance of transactions between Tribune Publishing and Tribune and Tribune Affiliates, Tribune Publishing’s paid-in-capital, and Tribune’s interest in Tribune Publishing’s cumulative retained earnings, and are presented within parent company investment and combined with accumulated other comprehensive income to total equity (deficit). The amounts comprising the accumulated balance of transactions between Tribune Publishing and Tribune and Tribune Affiliates include (i) the cumulative net assets attributed to Tribune Publishing by Tribune and Tribune Affiliates, (ii) the cumulative net advances to Tribune representing the cumulative Tribune Publishing funds swept (net of funding provided by Tribune and Tribune Affiliates to Tribune Publishing) as part of the centralized cash management program described further below, (iii) the cumulative charges (net of credits) allocated by Tribune and Tribune Affiliates to Tribune Publishing for certain support services received by Tribune Publishing and (iv) related party dividends for rent payments on related party leases as described further below.
Centralized Cash Management —Tribune utilizes a centralized approach to cash management and the financing of its operations. Under this centralized cash management program, Tribune and Tribune Publishing advance funds to each other. Accordingly, none of Tribune’s cash and cash equivalents has been assigned to Tribune Publishing in the combined financial statements. Cash in the combined balance sheets represents either cash not yet advanced to Tribune or cash held locally by Tribune Publishing. These transactions are recorded in equity (deficit) when advanced.
Support Services Provided and Other Amounts with Tribune and Tribune Affiliates —Tribune Publishing received allocated charges from Tribune and Tribune Affiliates for certain corporate support services, which are recorded within selling, general and administrative expense in Tribune Publishing’s combined statements of comprehensive income. Management believes that the bases used for the allocations are reasonable and reflect the portion of such costs attributed to Tribune Publishing’s operations; however, the amounts may not be representative of the costs necessary for Tribune Publishing to operate as a separate stand-alone company. These allocated costs are summarized in the following table (in thousands):

 	  	Fiscal Years	 	
 	  	Successor	 	 	   	  	Predecessor	 	
 	  	2013	 	 	   	  	2012	 	 	2011	 	
Corporate management fee	  	$	29,450	  	 	 	  	$	34,756	  	 	$	30,571	  	
Service center support costs	  	 	1,268	  	 	 	  	 	2,259	  	 	 	14,175	  	
Technology service center support costs	  	 	         103,346	  	 	 	  	 	          108,893	  	 	 	          94,260	  	
General insurance	  	 	5,716	  	 	 	  	 	7,471	  	 	 	6,748	  	
Occupancy	  	 	—	  	 	 	  	 	7,315	  	 	 	7,681	  	
Other support costs	  	 	1,774	  	 	 	  	 	1,686	  	 	 	1,718	  	
Cost recoveries	  	 	(768	) 	 	 	  	 	(3,277	) 	 	 	(3,462	) 	
	  	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total	  	$	140,786	  	 	 	  	$	159,103	  	 	$	151,691	  	
	  	 	 	 	 	 	  	 	 	 	 	 	 	 	
The above summary of allocated costs includes depreciation expense allocated by Tribune and Tribune Affiliates for certain assets that support Tribune Publishing and other Tribune Affiliates. These assets primarily
 
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relate to capitalized software that is utilized by Tribune, including Tribune Publishing, to operate its businesses and such assets have not been included in Tribune Publishing’s combined balance sheets. Allocated depreciation expense totaled $17.1 million, $23.5 million and $22.3 million for 2013, 2012 and 2011, respectively, and was allocated primarily based on headcount, Tribune Publishing’s revenue as a percentage of total Tribune revenue and utilization of assets by Tribune Publishing.
The corporate management fee related to support Tribune Publishing received from Tribune and Tribune Affiliates for certain corporate activities includes: (i) executive management, (ii) corporate development, (iii) corporate relations, (iv) legal, (v) human resources, (vi) internal audit, (vii) financial reporting, (viii) tax, (ix) treasury, and (x) other Tribune corporate and infrastructure costs. For these services, Tribune Publishing was charged a management fee based on actual costs incurred by Tribune and Tribune affiliates, and allocated to Tribune Publishing based upon Tribune Publishing’s revenue as a percentage of total Tribune revenue in each fiscal year.
Service center support costs relate to support Tribune Publishing received from Tribune service centers, which centrally manage and process (for all Tribune business units) certain financial transactions (e.g. payroll, accounts payable, etc.) and human resources activities (e.g. administration of employee benefits programs, employee relations, recruitment, etc.). Service center support costs have been allocated based on either the number of payments processed or other volume measures for financial transactions, headcount for payroll costs, or Tribune Publishing’s revenue as a percentage of total Tribune revenue. Such allocated costs are intended to represent the costs of providing these services to Tribune Publishing.
In 2010, Tribune began a process to expand its finance shared service center, including adding additional services such as collections, circulation, general accounting and controls compliance functions and relocated its finance shared service center operations from Chicago, Illinois to Dallas, Texas. By 2013, all shared service center operations were relocated to BLM in Dallas, Texas.
Technology service center support costs related to Tribune’s centrally managed information technology function that provides certain technology-related services to Tribune Publishing including: (i) networks, (ii) email, (iii) infrastructure, (iv) support, and (v) other technology services. The costs of these services were determined by allocating a portion of the total information technology costs, and are intended to represent the costs of providing these services to Tribune Publishing. Technology service center costs have been allocated based on headcount, usage or other volume measures for certain network, network security and desktop and web application support services, and Tribune Publishing’s revenue as a percentage of total Tribune revenue for circulation support and depreciation costs.
General insurance costs relate to Tribune Publishing’s participation in Tribune-sponsored risk management plans for (i) general liability, (ii) auto liability, and (iii) other insurance such as property and media. Such costs were allocated, depending upon insurance type, based on actuarially determined historical loss experience, vehicle count, headcount or proportional insured values for real and personal property replacement costs and business interruption.
Occupancy costs relate to certain facilities owned and/or leased by Tribune and Tribune Affiliates that were utilized by Tribune Publishing employees and principally relate to shared corporate office space. These costs were charged to Tribune Publishing primarily based on actual square footage utilized. Occupancy costs include facility rent, maintenance, security and other occupancy related costs incurred to manage the properties. In connection with the internal restructuring plan, discussed in Note 2, the shared corporate office space was transferred to Tribune’s newly established real estate holding companies on Dec. 21, 2012 and related party lease agreements were established between Tribune Publishing and the real estate holding companies. Beginning in
 
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NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
2013, the occupancy costs for shared corporate office space were replaced with rent expense. Historical occupancy costs and rent expense are recorded in selling, general and administrative expense in its combined statements of comprehensive income. The related party lease agreements are discussed in further detail below.
Other support costs related to charges to Tribune Publishing from Tribune Affiliates for audit and bank fees, shared resources, syndicated content and other support services. Such costs were allocated based on actual costs incurred and Tribune Publishing’s revenue as a percentage of total Tribune revenue.
Cost recoveries reflect costs recovered from Tribune and Tribune Affiliates for functions provided by Tribune Publishing, including shared resources, purchase and syndicated content, printing and direct mail, sales services, research and occupancy costs. Such costs were primarily allocated based on usage or other volume measurements, management estimates of the percentage of time that employees spent on operating activities at Tribune and Tribune Affiliates and square footage.
Severance costs incurred by Tribune at service centers that provide a benefit to Tribune Publishing have been allocated and included within corporate management fee, service center support, technology service center support and occupancy costs, as applicable. Allocated severance costs totaled $1.7 million, $0.4 million and $1.6 million in 2013, 2012 and 2011, respectively, and were primarily allocated based on Tribune Publishing’s revenue as a percentage of total Tribune revenue or Tribune Publishing’s total allocated expense as a percentage of total Tribune allocable costs.
As noted above, Tribune’s service centers process substantially all of Tribune Publishing’s disbursements on its behalf. These disbursements are settled through equity (deficit).
Promissory Demand Notes Due to Tribune Affiliate —In connection with the Leveraged ESOP Transactions, Tribune entered into an $8.028 billion senior secured credit agreement, as amended on June 4, 2007 (collectively, the “Credit Agreement”). Pursuant to the terms of the Credit Agreement, Tribune Finance issued promissory demand notes aggregating $2.8 billion to certain Tribune Publishing Debtors. Interest on these promissory demand notes was payable at a per annum rate equal to the rate of interest applicable to the funds contributed to Tribune Finance by Tribune pursuant to the Credit Agreement.
As a result of the Tribune Publishing Debtors’ Chapter 11 filings, these promissory demand notes were in default. Prior to the Effective Date, any efforts to enforce the Tribune Publishing Debtors’ payment obligations pursuant to the promissory demand notes were stayed as a result of the filing of the Chapter 11 Petitions. As a result, these promissory demand notes are included in liabilities subject to compromise in Tribune Publishing’s combined balance sheets. In accordance with ASC Topic 852, following the Petition Date, Tribune Publishing ceased accruing interest expense on the promissory demand notes classified as a liability subject to compromise. Accrued interest on the promissory demand notes was also classified as liabilities subject to compromise and amounted to $22.9 million at Dec. 30, 2012. These promissory demand notes, and the related accrued interest, were subsequently forgiven by Tribune Finance on the Effective Date in accordance with and pursuant to the terms of the Plan.
Medical and Workers’ Compensation Benefit Plans —Tribune Publishing participates in Tribune-sponsored employee benefit plans, including medical and workers’ compensation. Allocations of benefit plan costs varied by plan type and were based on actuarial valuations of cost and/or liability, premium amounts and payroll. Total benefit plan costs allocated to Tribune Publishing amounted to $49.3 million, $52.2 million and $60.3 million in 2013, 2012 and 2011, respectively, and are recorded in cost of sales and selling, general and administrative expense, as appropriate, in the combined statements of comprehensive income. While
 
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NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
management believes the cost allocation methods utilized for the benefit plans were reasonable and reflected the portion of such costs attributed to Tribune Publishing, the amounts may not be representative of the costs necessary for Tribune Publishing to operate as a stand-alone business.
Defined Benefit Plans —Retirement benefits obligations pursuant to the Tribune-sponsored defined benefit pension plans have historically been and will continue to be an obligation of Tribune. Therefore, Tribune Publishing accounts for (credits) costs associated with these defined benefit pension plans as a participant in multi-employer plans in accordance with ASC Topic 715. Annual (credits) costs related to Tribune-sponsored pension plans, which totaled $(23.8) million, $66.8 million and $39.2 million in fiscal years 2013, 2012 and 2011, respectively, were based upon a specific allocation of actuarially determined service costs plus an allocation of the remaining net periodic pension cost components based upon Tribune Publishing’s proportional share of the pension liability. Tribune-sponsored pension plan (income) expense allocated to Tribune Publishing is recorded in cost of sales and selling, general and administrative expense, as appropriate, in the combined statements of comprehensive income. As of December 2012, substantially all of the Tribune-sponsored defined benefit pension plans have been frozen.
The weighted average assumptions used each year in accounting for Tribune’s pension benefits prior to being allocated to Tribune Publishing, are summarized in the below table:

 	  	Pension Plans	 	
 	  	    2013    	 	 	    2012    	 	
Discount rate for expense	  	 	3.85	% 	 	 	4.10	% 	
Increase in future salary levels for expense	  	 	3.50	% 	 	 	3.50	% 	
Long-term rate of return on plans’ assets for expense	  	 	7.50	% 	 	 	7.50	% 	
While management believes the allocation methods utilized for the Tribune-sponsored pension plans were reasonable and reflected the portion of such (income) cost attributed to Tribune Publishing, the amounts may not be representative of the costs necessary for Tribune Publishing to operate as a stand-alone business.
Defined Contribution Plans —Tribune Publishing employees have historically participated in various Tribune qualified 401(k) savings plans, which permit eligible employees to make voluntary contributions on a pretax basis. The plans allowed participants to invest their savings in various investments. Amounts charged to expense by Tribune Publishing for employer contributions to Tribune 401(k) savings plans totaled $13.3 million, $16.6 million and $16.2 million in fiscal years 2013, 2012 and 2011, respectively, and are recorded in cost of sales and selling, general and administrative expense, as appropriate, in the combined statements of comprehensive income.
Related Party Lease Agreements —As described in Note 1, on Dec. 21, 2012, the majority of the land and buildings owned by Tribune Publishing were transferred to Tribune’s newly established real estate holding companies. As of the date of the transfers, the carrying value of the transferred properties was $294.5 million.
On Nov. 15, 2013, Tribune Publishing transferred two additional properties to the real estate holding companies and subsequently leased back the properties from Tribune. The carrying value of the properties transferred on Nov. 15, 2013 was $18.0 million.
In 2013, Tribune Publishing entered into related party lease agreements with the real estate holding companies to lease back certain land and buildings that were transferred on Dec. 21, 2012. The initial term of these non-cancellable related party lease agreements is either five or ten years, with two optional renewal terms. Tribune Publishing determined that pursuant to the terms of the leases, it maintained forms of continuing
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
involvement with the properties subject to related party leases, which, in accordance with ASC Topic 840, precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result, Tribune Publishing continued to account for and depreciate the carrying values of the transferred properties subject to related party leases and rent payments were accounted for as dividends to Tribune and Tribune Affiliates. Tribune Publishing recorded $4.7 million of depreciation expense for such properties during fiscal year 2013.
On Dec. 1, 2013, Tribune Publishing modified the related party leases to eliminate certain protections provided to the landlord in the event of default by the tenant, including the right to collect rent and other balances owed by tenant under the leases utilizing insurance proceeds received by the landlord in the event of damage and otherwise payable to the tenant, as well as the right to collect rent directly from subtenants to the extent all or a portion of the premise is sublet. Pursuant to ASC Topic 840, these provisions had precluded Tribune Publishing from derecognizing those properties from its combined financial statements. As a result of these modifications, Tribune Publishing determined that it no longer had forms of continuing involvement with the transferred properties and derecognized such properties from its combined financial statements by recording a $337.6 million reduction to net properties and a corresponding reduction to the parent company investment component of equity (deficit) in its combined balance sheet. Tribune Publishing has accounted for these related party leases as operating leases beginning on Dec. 1, 2013. In connection with all related party lease agreements, Tribune Publishing recognized $10.6 million of rent expense for fiscal year 2013, recorded in cost of sales and selling, general and administrative expense, as appropriate.
In addition, in 2013, Tribune Publishing entered into various related party lease agreements with a Tribune real estate holding company to lease the portions of the shared corporate office space that Tribune Publishing continues to occupy for an initial 5-year term. In accordance with ASC Topic 840, Tribune Publishing has accounted for these related party leases as operating leases in 2013. Costs associated with the related party lease agreements for shared corporate office space were recorded in selling, general and administrative expense.
Tribune Publishing’s minimum lease payments under the related party operating lease arrangements are as follows (in thousands):

2014	  	$	35,394	  	
2015	  	 	36,977	  	
2016	  	 	37,883	  	
2017	  	 	38,877	  	
2018	  	 	29,974	  	
Thereafter	  	 	96,578	  	
	  	 	 	 	
Total	  	$	275,683	  	
	  	 	 	 	
The remainder of the transferred properties, which had a carrying value of $28.5 million as of the date of the transfers, are no longer utilized in the operations of Tribune Publishing; therefore, Tribune Publishing did not enter into related party leases for those properties. During the second half of 2013, Tribune Publishing entered into management agreements with the real estate holding companies pursuant to which it will manage those properties for an initial term of one year, cancellable by the real estate holding companies with a 30-day notice.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
NOTE 7: INVENTORIES
Inventories consisted of the following (in thousands):

 	  	Successor	 	  	   	  	Predecessor	 	
 	  	Dec. 29, 2013	 	  	   	  	Dec. 30, 2012	 	
Newsprint	  	$	13,831	  	  	 	  	$	12,465	  	
Other	  	 	391	  	  	 	  	 	72	  	
	  	 	 	 	  	 	  	 	 	 	
Total inventories	  	$	14,222	  	  	 	  	$	12,537	  	
	  	 	 	 	  	 	  	 	 	 	
As discussed in Note 4, effective Dec. 31, 2012 and in conjunction with the adoption of fresh-start reporting, Reorganized Tribune Publishing elected to change its costing method to the FIFO method for newsprint inventories. Newsprint inventories valued under the LIFO method were less than current cost by approximately $5.5 million at Dec. 30, 2012.
NOTE 8: GOODWILL, OTHER INTANGIBLE ASSETS AND INTANGIBLE LIABILITIES
Goodwill, other intangible assets and intangible liabilities at Dec. 29, 2013 and Dec. 30, 2012 consisted of the following (in thousands):

 	 	Successor	 	 	   	 	Predecessor	 	
 	 	Dec. 29, 2013	 	 	   	 	Dec. 30, 2012	 	
 	 	Gross
Amount	 	 	Accumulated
Amortization	 	 	Net
Amount	 	 	   	 	Gross
Amount	 	 	Accumulated
Amortization	 	 	Net
Amount	 	
Other intangible assets subject to amortization (1)	 				 				 				 	 	 				 				 				
Subscribers (useful life of 2 to 10 years)	 	$	3,694	  	 	$	(919	) 	 	$	2,775	  	 	 	 	$	97,576	  	 	$	(76,719	) 	 	$	20,857	  	
Advertiser relationships (useful life of 2 to 13 years)	 	 	14,332	  	 	 	(2,032	) 	 	 	12,300	  	 	 	 	 	—	  	 	 	                     —	  	 	 	—	  	
Other (useful life of 1 to 15 years)	 	 	17,061	  	 	 	(3,454	) 	 	 	13,607	  	 	 	 	 	11,609	  	 	 	(9,555	) 	 	 	2,054	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	 	$	35,087	  	 	$	(6,405	) 	 	$	28,682	  	 	 	 	$	109,185	  	 	$	(86,274	) 	 	$	22,911	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Goodwill and other intangible assets not subject to amortization	 				 				 				 	 	 				 				 				
Goodwill	 				 				 	 	15,331	  	 	 	 				 				 	 	—	  	
Newspaper mastheads	 				 				 	 	31,800	  	 	 	 				 				 	 	6,000	  	
	 				 				 	 	 	 	 	 	 				 				 	 	 	 	
Total goodwill and other intangible assets	 				 				 	$	75,813	  	 	 	 				 				 	$	28,911	  	
	 				 				 	 	 	 	 	 	 				 				 	 	 	 	
Intangible liabilities subject to amortization	 				 				 				 	 	 				 				 				
Lease contract intangible liabilities	 	 	(545	) 	 	 	218	  	 	 	(327	) 	 	 	 	 	—	  	 	 	—	  	 	 	—	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total intangible liabilities subject to amortization	 	$	(545	) 	 	$	218	  	 	$	(327	) 	 	 	 	$	—	  	 	$	—	  	 	$	—	  	

(1)	Useful lives presented in the table above represent those used by the Successor.	
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
The changes in the carrying amounts of intangible assets subject to amortization during the years ended Dec. 29, 2013 and Dec. 30, 2012 were as follows (in thousands):

Intangible assets subject to amortization	  				
Balance as of Dec. 25, 2011 (Predecessor)	  	$	28,467	  	
Amortization expense	  	 	(6,382	) 	
Additions	  	 	826	  	
	  	 	 	 	
Balance as of Dec. 30, 2012 (Predecessor)	  	$	22,911	  	
Fresh start	  	 	12,176	  	
Amortization expense	  	 	(6,580	) 	
Additions	  	 	                   175	  	
	  	 	 	 	
Balance as of Dec. 29, 2013 (Successor)	  	$	28,682	  	
	  	 	 	 	
The changes in the carrying amounts of intangible assets not subject to amortization and goodwill during the years ended Dec. 29, 2013 and Dec. 30, 2012 were as follows (in thousands):

Other intangible assets not subject to amortization	  				
Balance as of Dec. 25, 2011 and Dec. 30, 2012 (Predecessor)	  	$	6,000	  	
Fresh-start reporting adjustments	  	 	25,800	  	
	  	 	 	 	
Balance as of Dec. 31, 2012 and Dec. 29, 2013 (Successor)	  	$	31,800	  	
	  	 	 	 	
Goodwill	  				
Balance as of Dec. 25, 2011 and Dec. 30, 2012 (Predecessor)	  	$	                     —	  	
Fresh-start reporting adjustments	  	 	15,331	  	
	  	 	 	 	
Balance as of Dec. 31, 2012 and Dec. 29, 2013 (Successor)	  	$	15,331	  	
	  	 	 	 	
As disclosed in Note 4, Tribune Publishing reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350. As of the fourth quarter of 2013 Tribune Publishing conducted its annual goodwill impairment test utilizing the two-step impairment test and its annual impairment test of other indefinite-lived intangible assets in accordance with ASC Topic 350. No impairment charges were recorded.
The determination of estimated fair values of goodwill and other indefinite-lived intangible assets requires many judgments, assumptions and estimates of several critical factors, including projected revenues and related growth rates, projected operating margins and cash flows, estimated income tax rates, capital expenditures, market multiples and discount rates, as well as specific economic factors such as royalty rates for newspaper mastheads. Fair value estimates for each of Tribune Publishing’s indefinite-lived intangible assets are inherently sensitive to changes in these estimates. Adverse changes in expected operating results and/or unfavorable changes in other economic factors could result in non-cash impairment charges in the future under ASC Topic 350.
Amortization expense relating to amortizable intangible assets is expected to be approximately $6.4 million in 2014, $5.0 million in 2015, $4.9 million in 2016, $1.9 million in 2017 and $1.9 million in 2018.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
NOTE 9: INVESTMENTS
Investments consisted of equity method investments totaling $2.8 million at Dec. 29, 2013 and $4.0 million at Dec. 30, 2012. The balance is largely comprised of the investments made in the following private companies:

Company	  	% Owned	 	
CIPS Marketing Group, Inc	  	 	50	% 	
Homefinder.com, LLC	  	 	33	% 	
Locality Labs, LLC	  	 	35	% 	
McClatchy/Tribune Information Services	  	 	50	% 	
In 2013, 2012 and 2011, Tribune Publishing recorded losses of $1.2 million, $2.3 million and $0.9 million, respectively, relating to its equity method investments. In 2013, Tribune did not make any new investments or receive any distributions from its equity method investments. In 2012, Tribune Publishing made an aggregate $8.9 million investment in and received a distribution of $0.6 million from its equity method investments during the year.
In 2012, Tribune Publishing recorded a non-cash pretax charge of $6.1 million related to the write-down of one of its equity method investments. This write-down resulted from a decline in the fair value of the investment that Tribune Publishing determined to be other than temporary. The estimated fair value of this investment was based primarily on consideration of the fair value of the investee’s individual assets and liabilities at Dec. 30, 2012. The valuation inputs for this investment are not highly observable as the investment is not actively traded on an open market. Therefore, this investment is classified as a Level 3 asset in the fair value hierarchy established under ASC Topic 820 at Dec. 30, 2012.
Tribune Publishing provides support services to MCT and manages its daily cash receipts and disbursements. As a result, Tribune Publishing had an outstanding payable to MCT of $2.8 million and $2.0 million for cash receipts in excess of the support services provided to MCT as of Dec. 29, 2013 and Dec. 30, 2012, respectively. This payable is included in other obligations in Tribune Publishing’s combined balance sheets at Dec. 29, 2013 and Dec. 30, 2012.
NOTE 10: COMMITMENTS AND CONTINGENT LIABILITIES
Operating Leases —Tribune Publishing leases certain equipment and office and production space under various prepetition and postpetition operating leases. Net lease expense for Tribune Publishing was $18.8 million in 2013, $19.3 million in 2012 and $21.0 million in 2011. Net lease expense excludes lease costs incurred by Tribune and Tribune Affiliates and allocated to Tribune Publishing. See Note 6 for further discussion of allocated charges from Tribune and Tribune Affiliates.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Tribune Publishing’s future minimum lease payments under non-cancellable operating leases, exclusive of leases entered into with Tribune Affiliates as separately disclosed in Note 6, at Dec. 29, 2013 were as follows (in thousands):

2014	  	$	19,314	  	
2015	  	 	13,478	  	
2016	  	 	        9,901	  	
2017	  	 	4,909	  	
2018	  	 	4,002	  	
Thereafter	  	 	4,067	  	
	  	 	 	 	
Total	  	$	55,671	  	
	  	 	 	 	
Pursuant to the terms of the Plan and subject to certain specified exceptions, on the Effective Date, all unexpired prepetition leases of the Debtors that were not previously assumed or rejected pursuant to Section 365 of the Bankruptcy Code or rejected pursuant to the Plan were deemed assumed in accordance with, and subject to, the provisions and requirements of Sections 365 and 1123 of the Bankruptcy Code.
Other Commitments —At Dec. 29, 2013, Tribune Publishing had commitments related to the purchase of transportation and news and market data services totaling $15.7 million.
Tribune Publishing is a party to various arrangements with third party suppliers to purchase newsprint. Under these arrangements, Tribune Publishing agreed to purchase 35,000 metric tons of newsprint in 2014, subject to certain limitations, based on market prices at the time of purchase.
Other Contingencies —The legal entities comprising Tribune Publishing’s operations are defendants from time to time in actions for matters arising out of their business operations. In addition, the legal entities comprising Tribune Publishing’s operations are involved from time to time as parties in various regulatory, environmental and other proceedings with governmental authorities and administrative agencies.
Tribune Publishing does not believe that any matters or proceedings presently pending will have a material adverse effect, individually or in the aggregate, on its combined financial position, results of operations or liquidity.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
NOTE 11: INCOME TAXES
The following is a reconciliation of income taxes computed at the U.S. federal statutory rate to income tax expense reported in the combined statements of comprehensive income (in thousands):

 	  	Successor	 	  	   	  	Predecessor	 	
 	  	2013	 	  	   	  	Dec. 31, 2012	 	 	2012	 	  	2011	 	
Income before income taxes	  	$	165,086	  	  	 	  	$	2,754,553	  	 	$	31,689	  	  	$	44,153	  	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Federal income taxes (35% in 2013, 0% in 2012 and 2011)	  	 	        57,780	  	  	 	  	 	—	  	 	 
 	                 
—	  

—	  
  	
State and local income taxes, net of federal tax benefit	  	 	9,155	  	  	 	  	 	—	  	 	 	292	  	  	 	566	  	
Non-deductible transaction costs	  	 	3,484	  	  	 	  	 	—	  	 	 	—	  	  	 	—	  	
Federal income taxes related to non-qualified subchapter S subsidiaries	  	 	—	  	  	 	  	 	—	  	 	 	2,772	  	  	 	2,118	  	
Valuation allowance	  	 	—	  	  	 	  	 	—	  	 	 	35	  	  	 	24	  	
Other, net	  	 	573	  	  	 	  	 	—	  	 	 	195	  	  	 	(169	) 	
Income taxes on reorganization items	  	 	—	  	  	 	  	 	(32,429	) 	 	 	—	  	  	 	—	  	
Income taxes attributable to fair value adjustments	  	 	—	  	  	 	  	 	(55,344	) 	 	 	—	  	  	 	—	  	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Income tax expense (benefit)	  	$	70,992	  	  	 	  	$	(87,773	) 	 	$	3,294	  	  	$	2,539	  	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Effective tax rate	  	 	43.0%	  	  	 	  	 	(3.2)%	  	 	 	10.4%	  	  	 	5.8%	  	
Subchapter S Corporation Election and Subsequent Conversion to C Corporation —On March 13, 2008, Tribune filed an election to be treated as a subchapter S corporation under the IRC, with the election effective as of the beginning of Tribune’s 2008 fiscal year. Tribune also elected to treat nearly all of its subsidiaries, including nearly all of the subsidiaries through which Tribune Publishing operates, as qualified subchapter S subsidiaries. Subject to certain limitations (such as built-in-gains tax applicable for ten years to gains accrued prior to the election), Tribune and Tribune Publishing were not subject to federal income tax. Although most states in which Tribune and Tribune Publishing operate recognize subchapter S corporation status, some impose tax at a reduced rate. Certain Tribune Publishing non-qualified subchapter S subsidiaries were subject to federal and state income taxes as C corporations.
As a result of the election and in accordance with ASC Topic 740, Tribune Publishing reduced its net deferred income tax assets to report only deferred income taxes relating to states that assess taxes on subchapter S corporations and subsidiaries that were not qualified subchapter S subsidiaries.
On the Effective Date and in accordance with and subject to the terms of the Plan, (i) the ESOP was deemed terminated in accordance with its terms, (ii) all of Tribune’s $0.01 par value common stock held by the ESOP was cancelled and (iii) new shares of Reorganized Tribune Company were issued to shareholders who did not meet the necessary criteria to qualify as a subchapter S corporation shareholder. As a result, Reorganized Tribune Company converted from a subchapter S corporation to a C corporation under the IRC and therefore is subject to federal and state income taxes at a higher effective tax rate in periods subsequent to the Effective Date. This conversion also affected Tribune subsidiaries that were treated as qualified subchapter S subsidiaries, including certain legal entities included in the accompanying combined financial statements of Tribune Publishing. Tribune Publishing’s net tax benefit relating to this conversion and other reorganization adjustments recorded in connection with Reorganized Tribune Company’s emergence from bankruptcy was $32.4 million, which was reported as an increase in deferred income tax assets in the Predecessor’s Dec. 31, 2012 consolidated
 
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NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
balance sheet and an increase in income tax benefit in the Predecessor’s combined statement of comprehensive income for Dec. 31, 2012. In addition, the implementation of fresh-start reporting, as described in Note 3, resulted in an aggregate increase of $61.8 million in net deferred income tax assets in the Predecessor’s Dec. 31, 2012 combined balance sheet and an aggregate increase of $61.8 million in income tax benefit in the Predecessor’s combined statement of comprehensive income for Dec. 31, 2012.
As described in Note 3, amounts included in the Predecessor’s accumulated other comprehensive income (loss) at Dec. 30, 2012 were eliminated. As a result, the Predecessor recorded $20.7 million of previously unrecognized cumulative pretax income in reorganization items, net and a related income tax expense of $6.4 million in its combined statement of comprehensive income for Dec. 31, 2012.
Tribune Publishing’s operations are included in Tribune’s federal and state S corporation income tax returns with the exception of certain non-qualified subchapter S subsidiaries. For the purposes of these combined financial statements, Tribune Publishing has computed income taxes as if it were filing separate returns. Current income taxes payable are settled with Tribune through the equity (deficit) account.
In 2013, income taxes amounted to $71.0 million of which $3.5 million related to non-deductible expenses and $67.5 million were primarily as a result of Tribune Publishing’s conversion to a C corporation as discussed above.
Components of income tax expense were as follows (in thousands):

 	  	Successor	 	  	   	  	Predecessor	 	
 	  	2013	 	  	   	  	Dec. 31, 2012	 	 	2012	 	  	2011	 	
Current:	  	 	                       	  	  	 	  				 	 	                       	  	  	 	                       	  	
U.S. federal	  	$	40,167	  	  	 	  	$	—	  	 	$	2,772	  	  	$	2,152	  	
State and local	  	 	10,097	  	  	 	  	 	—	  	 	 	353	  	  	 	663	  	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Sub-total	  	 	50,264	  	  	 	  	 	—	  	 	 	3,125	  	  	 	2,815	  	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Deferred:	  				  	 	  				 				  				
U.S. federal	  	 	16,573	  	  	 	  	 	(73,268	) 	 	 	92	  	  	 	(12	) 	
State and local	  	 	4,155	  	  	 	  	 	(14,505	) 	 	 	77	  	  	 	(264	) 	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Sub-total	  	 	20,728	  	  	 	  	 	(87,773	) 	 	 	169	  	  	 	(276	) 	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	  	 	 	 	
Total	  	$	70,992	  	  	 	  	$	(87,773	) 	 	$	3,294	  	  	$	2,539	  	

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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Significant components of Tribune Publishing’s net deferred tax assets and liabilities were as follows (in thousands):

 	 	Successor	 	 	   	 	Predecessor	 	
 	 	Dec. 29, 2013	 	 	   	 	Dec. 30, 2012	 	
Deferred tax assets:	 				 	 	 				
Net properties	 	$	20,926	  	 	 	 	$	—	  	
Net intangibles	 	 	—	  	 	 	 	 	250	  	
Postretirement and postemployment benefits other than pensions	 	 	19,091	  	 	 	 	 	471	  	
Employee compensation and benefits	 	 	24,426	  	 	 	 	 	607	  	
Other future deductible items	 	 	6,573	  	 	 	 	 	462	  	
Accounts receivable	 	 	5,069	  	 	 	 	 	157	  	
Investments	 	 	2,968	  	 	 	 	 	97	  	
	 	 	 	 	 	 	 	 	 	 	
Total deferred tax assets	 	 	79,053	  	 	 	 	 	2,044	  	
	 	 	 	 	 	 	 	 	 	 	
Deferred tax liabilities:	 				 	 	 				
Net properties	 	 	—	  	 	 	 	 	966	  	
Net intangibles	 	 	2,095	  	 	 	 	 	—	  	
	 	 	 	 	 	 	 	 	 	 	
Total deferred tax liabilities	 	 	2,095	  	 	 	 	 	966	  	
	 	 	 	 	 	 	 	 	 	 	
Net deferred tax assets	 	$	76,958	  	 	 	 	$	1,078	  	
	 	 	 	 	 	 	 	 	 	 	
Accounting for Uncertain Tax Positions —Tribune Publishing accounts for uncertain tax positions in accordance with ASC Topic 740, which addresses the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Under ASC Topic 740, a company may recognize the tax benefit of an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. ASC Topic 740 requires the tax benefit recognized in the financial statements to be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC Topic 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, and disclosure. Tribune Publishing has no uncertain tax positions at Dec. 29, 2013 and Dec. 30, 2012.
Emergence From Chapter 11 —As described in Note 2, prior to the Effective Date, Tribune and its subsidiaries consummated an internal restructuring, pursuant to and in accordance with the terms of the Plan. These restructuring transactions included, among other things, (i) converting certain of Tribune’s subsidiaries into limited liability companies or merging certain of Tribune’s subsidiaries into newly-formed limited liability companies, (ii) consolidating and reallocating certain operations, entities, assets and liabilities within the organizational structure of Tribune and (iii) establishing a number of real estate holding companies. These transactions had no impact on reported income tax expense for 2012.
Generally, for federal tax purposes, the discharge of a debt obligation in a bankruptcy proceeding for an amount less than its adjusted issue price (as defined in the IRC) creates cancellation of indebtedness income (“CODI”) that is excludable from the obligor’s taxable income. However, certain income tax attributes are reduced by the amount of CODI. The prescribed order of income tax attribute reduction is as follows: (i) net operating losses for the year of discharge and net operating loss carryforwards, (ii) most credit carryforwards, including the general business credit and the minimum tax credit, (iii) net capital losses for the year of discharge and capital loss carryforwards and (iv) the tax basis of the debtors’ assets. Tribune Publishing did not have any
 
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NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
net operating loss carryforwards, credit carryforwards or capital loss carryforwards at the Effective Date. Therefore, these tax attribute reduction provisions did not apply and the application of the CODI rules resulted in no basis reduction to the assets of Tribune Publishing.
NOTE 12: PENSION AND OTHER POSTRETIREMENT BENEFITS
Multiemployer Pension Plans —Tribune Publishing contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multiemployer plans are different from single-employer plans in that assets contributed are pooled and may be used to provide benefits to employees of other participating employers. If a participating employer withdraws from or otherwise ceases to contribute to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. Alternatively, if Tribune Publishing chooses to stop participating in one of its multiemployer plans, it may incur a withdrawal liability based on the unfunded status of the plan.
Tribune Publishing’s participation in these multiemployer pension plans at Dec. 29, 2013, Dec. 30, 2012 and Dec. 25, 2011, is outlined in the table below. Unless otherwise noted, the most recent Pension Protection Act (“PPA”) Zone Status available in 2013 and 2012 is for the plan’s year-end at Dec. 31, 2012 and Dec. 31, 2011, respectively. The PPA Zone Status is based on information that Tribune Publishing received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are less than 80 percent but greater than 65 percent funded, and plans in the green zone are at least 80 percent funded (as determined in accordance with the PPA). The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) is either pending or has been implemented.

Pension Fund	 	EIN/Pension
Plan Number	 	PPA Zone Status	 	FIP/RP
Status
Pending/
Implemented	 	Tribune Publishing
Contributions
(in thousands)	 	 	Surcharge
Imposed	 	Expiration
Date of
Collective
Bargaining	
	 		 	2013	 	2012	 		 	2013	 	 	2012	 	 	2011	 	 		 	Agreement	
GCIU—Employer
Retirement Benefit Plan	 	91-6024903	 	Red	 	Red	 	Implemented	 	$	1,134	  	 	$	944	  	 	$	892	  	 	Yes (1)	 	May 31, 2012 to
April 30, 2014 (1)	
Chicago Newspaper Publishers Drivers’ Union Pension Plan	 	36-6019539	 	Red	 	Red	 	Implemented	 	 	2,553	  	 	 	2,353	  	 	 	1,990	  	 	No	 	Dec. 31, 2014	
Truck Drivers and Helpers Local No. 355 Pension Plan	 	52-6043608	 	Yellow	 	Yellow	 	Implemented	 	 	126	  	 	 	126	  	 	 	107	  	 	No	 	Dec. 31, 2013 (2)	
Other Plans	 	—  	 	—  	 	—  	 	—  	 	 	263	  	 	 	216	  	 	 	219	  	 	—  	 	—  	
	 		 		 		 		 	 	 	 	 	 	 	 	 	 	 	 	 		 		
	 		 		 		 		 	$	4,076	  	 	$	3,639	  	 	$	3,208	  	 		 		

(1)	Tribune Publishing is party to two collective bargaining agreements that require contributions to the GCIU—Employer Retirement Benefit Plan. Surcharges were imposed by only one agreement which expired on Apr. 30, 2012. During 2012, the parties entered into a new collective bargaining agreement, which expires on April 30, 2014. The other collective bargaining agreement expired on May 31, 2012. The parties are operating under the terms of this agreement while the terms of a successor collective bargaining agreement are negotiated.	
(2)	A successor agreement is being negotiated and the parties are operating under the terms of the current collective bargaining agreement until such agreement has been negotiated.	
For the plan years ended Dec. 31, 2012, Dec. 31, 2011 and Dec. 31, 2010, Tribune was listed in the Chicago Newspaper Publishers Drivers’ Union Pension Plan’s (the “Drivers’ Plan”) Form 5500 as providing more than five percent of the total contributions for the plan. In addition, Tribune was listed in the GCIU Employer Retirement Benefit Plan’s Form 5500 as contributing more than five percent of the total contributions to the plan for the plan year ended Dec. 31, 2012. Tribune Publishing did not provide more than five percent of
 
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NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
the total contributions for any of the other multiemployer pension plans in which it participated in those years. At the date the financial statements were issued, Forms 5500 were not available for the plan years ending in 2013.
In 2009, the Drivers’ Plan was certified by its actuary to be in critical status (within the meaning of section 432 of the IRC) as of its plan year beginning Jan. 1, 2009. However, pursuant to the Worker, Retiree, and Employer Recovery Act of 2008, the trustees of the Drivers’ Plan elected to apply the 2008 actuarial certification for the plan year beginning Jan. 1, 2009. As a result, the Drivers’ Plan was not in critical status (or in endangered or seriously endangered status) for its plan year beginning Jan. 1, 2009. On March 31, 2010, the Drivers’ Plan was certified by its actuary to be in critical status for the plan year beginning Jan. 1, 2010. As a result, the trustees of the Drivers’ Plan were required to adopt and implement a rehabilitation plan as of Jan. 1, 2011 designed to enable the Drivers’ Plan to cease being in critical status within the period of time stipulated by the IRC. The terms of the rehabilitation plan adopted by the trustees require Tribune Publishing to make increased contributions beginning on Jan. 1, 2011 through Dec. 31, 2025, and the trustees of the Drivers’ Plan project that it will emerge from critical status on Jan. 1, 2026. Based on the actuarial assumptions utilized as of Jan. 1, 2010 to develop the rehabilitation plan, it is estimated that Tribune Publishing’s remaining share of the funding obligations to the Drivers’ Plan during the rehabilitation plan period is approximately $93 million as of Dec. 29, 2013. The funding obligation is subject to change based on a number of factors, including actual returns on plan assets as compared to assumed returns, changes in the number of plan participants and changes in the rate used for discounting future benefit obligations.
Postretirement Benefits Other Than Pensions —Tribune provides postretirement health care and life insurance benefits to Tribune Publishing eligible employees under a variety of plans. There is some variation in the provisions of these plans, including different provisions for lifetime maximums, prescription drug coverage and certain other benefits. The Tribune Publishing portion of the funded status and the related service costs and comprehensive income (loss) has been actuarially determined based on Tribune Publishing eligible employees and is reflected in these combined financial statements.
Obligations and Funded Status —As discussed in Note 4, Tribune Publishing recognizes its portion of the overfunded or underfunded status of the other postretirement plans as an asset or liability in its combined balance sheets and recognizes changes in that funded status in the year in which changes occur through comprehensive income (loss).
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Summarized information for Tribune Publishing’s other postretirement plans is provided below (in thousands):

 	  	Other Postretirement Plans	 	
 	  	Successor	 	 	   	  	Predecessor	 	
 	  	    Dec. 29, 2013    	 	 	   	  	    Dec. 30, 2012    	 	
Change in benefit obligations:	  				 	 	  				
Projected benefit obligations, beginning of year	  	$	49,895	  	 	 	  	$	63,180	  	
Service cost	  	 	445	  	 	 	  	 	664	  	
Interest cost	  	 	1,550	  	 	 	  	 	1,995	  	
Impact of Medicare Reform Act	  	 	76	  	 	 	  	 	223	  	
Actuarial (gain) loss	  	 	512	  	 	 	  	 	(12,227	) 	
Benefits paid	  	 	(4,149	) 	 	 	  	 	(3,940	) 	
	  	 	 	 	 	 	  	 	 	 	
Projected benefit obligations, end of year	  	 	48,329	  	 	 	  	 	49,895	  	
	  	 	 	 	 	 	  	 	 	 	
Change in plans’ assets:	  				 	 	  				
Employer contributions	  	 	4,149	  	 	 	  	 	3,940	  	
Benefits paid	  	 	(4,149	) 	 	 	  	 	(3,940	) 	
	  	 	 	 	 	 	  	 	 	 	
Fair value of plans’ assets, end of year	  	 	—	  	 	 	  	 	—	  	
	  	 	 	 	 	 	  	 	 	 	
Under funded status of the plans	  	$	(48,329	) 	 	 	  	$	(49,895	) 	
	  	 	 	 	 	 	  	 	 	 	
Amounts recognized in Tribune Publishing’s combined balance sheets consisted of (in thousands):

 	  	Other Postretirement Plans	 	
 	  	Successor	 	 	   	  	Predecessor	 	
 	  	    Dec. 29, 2013    	 	 	   	  	    Dec. 30, 2012    	 	
Employee compensation and benefits	  	$	(5,080	) 	 	 	  	$	(4,729	) 	
Postretirement medical, life and other benefits	  	 	(43,249	) 	 	 	  	 	(45,166	) 	
	  	 	 	 	 	 	  	 	 	 	
Net amount recognized	  	$	(48,329	) 	 	 	  	$	(49,895	) 	
	  	 	 	 	 	 	  	 	 	 	
Tribune Publishing’s allocated portion of the components of net periodic benefit cost for the Tribune-sponsored plans were as follows (in thousands):

 	  	Other Postretirement Plans	 	
 	  	    Successor    	 	  	   	  	Predecessor	 	
 	  	2013	 	  	   	  	      2012      	 	 	      2011      	 	
Service cost	  	$	445	  	  	 	  	$	664	  	 	$	717	  	
Interest cost	  	 	1,550	  	  	 	  	 	1,995	  	 	 	2,657	  	
Recognized actuarial gain	  	 	—	  	  	 	  	 	(3,985	) 	 	 	(3,599	) 	
Amortization of prior service credits	  	 	—	  	  	 	  	 	(1,192	) 	 	 	(1,192	) 	
	  	 	 	 	  	 	  	 	 	 	 	 	 	 	
Net periodic benefit cost (credit)	  	$	1,995	  	  	 	  	$	(2,518	) 	 	$	(1,417	) 	

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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Amounts included in the accumulated other comprehensive income (loss) component of equity (deficit) for Tribune Publishing were as follows (in thousands):

 	  	Other Postretirement Plans	 	
 	  	Successor	 	 	   	  	Predecessor	 	
 	  	Dec. 29, 2013	 	 	   	  	Dec. 30, 2012	 	
Unrecognized net actuarial gains (losses), net of tax	  	$	(310	) 	 	 	  	$	29,265	  	
Unrecognized prior service credits, net of tax	  	 	—	  	 	 	  	 	(2,107	) 	
	  	 	 	 	 	 	  	 	 	 	
Total	  	$	(310	) 	 	 	  	$	27,158	  	
	  	 	 	 	 	 	  	 	 	 	
As a result of the adoption of fresh-start reporting, unamortized amounts previously charged to accumulated other comprehensive income (loss) on Tribune’s consolidated balance sheet were eliminated on the Effective Date. See Note 3 for a presentation of the impact of the Plan and the adoption of fresh-start reporting on Tribune Publishing’s combined balance sheet as of the Effective Date.
Assumptions —The Tribune weighted average assumptions used each year in accounting for other postretirement benefits that were utilized for these financial statements were as follows:

 	  	Other Postretirement Plans	 	
 	  	2013	 	  	2012	 	
Discount rate for expense	  	 	3.15%	  	  	 	3.65%	  	
Discount rate for obligations	  	 	3.95%	  	  	 	3.15%	  	
For purposes of measuring postretirement health care costs for 2013, Tribune assumed a 7.5% annual rate of increase in the per capita cost of covered health care benefits. The rate was assumed to decrease gradually to 5% for 2019 and remain at that level thereafter. For purposes of measuring postretirement health care obligations at Dec. 29, 2013, Tribune assumed an 8.0% annual rate of increase in the per capita cost of covered health care benefits. The rate was assumed to decrease gradually to 5% for 2021 and remain at that level thereafter.
Assumed health care cost trend rates have a significant effect on the amounts reported for health care plans. As of Dec. 29, 2013, a 1% change in assumed health care cost trend rates would have the following effects on Tribune Publishing’s portion of postretirement benefits service and interest cost and projected benefit obligation (in thousands):

 	  	1% Increase	 	  	1% Decrease	 	
Service cost and interest cost	  	$	149	  	  	$	(134	) 	
Projected benefit obligation	  	$	2,530	  	  	$	(2,286	) 	
Expected Future Benefit Payments— Benefit payments expected to be paid to Tribune Publishing eligible employees under the Reorganized Tribune’s other postretirement benefit plans are summarized below (in thousands). The benefit payments reflect expected future service, as appropriate.
 
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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)

 	  	Other
Postretirement
Benefits	 	
2014	  	$	5,080	  	
2015	  	$	5,046	  	
2016	  	$	4,860	  	
2017	  	$	4,728	  	
2018	  	$	4,486	  	
Thereafter	  	$	18,867	  	
NOTE 13: STOCK-BASED COMPENSATION
On March 1, 2013, the compensation committee of Tribune’s board of directors adopted the 2013 Equity Incentive Plan (the “Equity Incentive Plan”) for the purpose of granting stock awards to directors, officers and employees of Tribune. Stock awarded pursuant to the Equity Incentive Plan is limited to five percent of the outstanding Tribune common stock on a diluted basis. There are 5,263,000 shares of New Common Stock authorized for issuance under the Equity Incentive Plan. As of Dec. 29, 2013, Tribune had 4,394,657 shares available for grant.
The Equity Incentive Plan provides for the granting of non-qualified stock options (“NSOs”), restricted stock units (“RSUs”), performance share units (“PSUs”) and restricted and unrestricted stock awards. Pursuant to ASC Topic 718, “Compensation-Stock Compensation,” Tribune measures stock-based compensation costs on the grant date based on the estimated fair value of the award and recognizes compensation costs on a straight-line basis over the requisite service period for the entire award. The Equity Incentive Plan allows employees to surrender to Tribune shares of vested common stock upon vesting of their stock awards or at the time they exercise their NSOs in lieu of their payment of the required withholdings for employee taxes. Tribune does not withhold taxes in excess of minimum required statutory requirements.
NSO and RSU awards generally vest 25% on each anniversary of the date of the grant. Under the Equity Incentive Plan, the exercise price of an NSO award cannot be less than the market price of Tribune common stock at the time the NSO award is granted and has a maximum contractual term of 10 years.
Tribune estimates the fair value of NSO awards using the Black-Scholes option-pricing model, which incorporates various assumptions including the expected term of the awards, volatility of the stock price, risk-free rate of return and dividend yield. The risk-free rate was based on the U.S. Treasury yield curve in effect at the time of grant. Expected volatility was based on the actual historical volatility of a select peer group of entities operating in similar industry sectors as Tribune. Expected life was calculated using the simplified method, as described under Staff Accounting Bulletin Topic 14, “Share-Based Payment,” as the Equity Incentive Plan was not in existence for a sufficient period of time for the use of Tribune-specific historical experience in the calculation.
The following table provides the weighted average assumptions used to determine the fair value of NSO awards granted to Tribune Publishing employees during the fiscal year ended Dec. 29, 2013:

 	  	2013	 	
Risk-free interest rate	  	 	1.21	% 	
Expected dividend yield	  	 	0	% 	
Expected stock price volatility	  	 	49.88	% 	
Expected life (in years)	  	 	6.23	  	
 
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NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
Tribune determines the fair value of RSUs by reference to the quoted market price of the Tribune common stock on the date of the grant.
Stock-based compensation expense for participants in the Equity Incentive Plan that are solely dedicated to Tribune Publishing have been included within selling, general and administrative expense within these combined financial statements. Stock-based compensation expense for participants in the Equity Incentive Plan that provide services to but are not solely dedicated to Tribune Publishing have been allocated to Tribune Publishing through the corporate management fee and technology service center support costs, as described in Note 6. Stock-based compensation expense related to Tribune Publishing employees during fiscal year 2013 totaled $1.7 million. Tribune Publishing was allocated $2.5 million of stock-based compensation expense in fiscal year 2013 through the corporate management fee and technology service center support costs.
A summary of activity, weighted average exercise prices and weighted average fair values related to the NSOs granted to Tribune Publishing employees is as follows:

 	  	2013	 	
 	  	Shares
(In thousands)	 	 	Weighted
Avg. Exercise
Price	 	  	Weighted
Avg.
Fair Value	 	  	Weighted Avg.
Remaining
Contractual
Term
(In years)	 	  	Aggregate
Intrinsic Value
(In thousands)	 	
Outstanding, beginning of period	  	 	—	  	 	$	—	  	  	$	—	  	  	 	—	  	  	$	—	  	
Granted	  	 	97	  	 	 	56.60	  	  	 	27.53	  	  				  				
Exercised	  	 	—	  	 	 	—	  	  	 	—	  	  				  				
Cancelled	  	 	—	  	 	 	—	  	  	 	—	  	  				  				
Forfeited	  	 	(9	) 	 	 	56.60	  	  	 	27.53	  	  				  				
	  	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Outstanding, end of period	  	 	88	  	 	$	56.60	  	  	$	27.53	  	  	 	9.4	  	  	$	1,855	  	
	  	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Vested, end of period	  	 	—	  	 	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
	  	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
A summary of activity and weighted average fair values related to the RSUs granted to Tribune Publishing employees is as follows:

 	  	2013	 	
 	  	Shares
(In thousands)	 	 	Weighted Avg.
Fair Value	 	  	Weighted Avg.
Remaining
Contractual Term
(In years)	 	
Outstanding, beginning of period	  	 	—	  	 	$	—	  	  				
Granted	  	 	126	  	 	 	56.60	  	  				
Vested and issued	  	 	—	  	 	 	—	  	  				
Forfeited	  	 	(9	) 	 	 	56.60	  	  				
	  	 	 	 	 	 	 	 	  	 	 	 	
Outstanding and nonvested, end of period	  	 	117	  	 	$	56.60	  	  	 	3.2	  	

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TRIBUNE PUBLISHING COMPANY
NOTES TO THE COMBINED FINANCIAL STATEMENTS (Continued)
 
As of Dec. 29, 2013, Tribune Publishing had not yet recognized compensation cost on nonvested awards as follows (in thousands):

 	  	Unrecognized
Compensation Cost	 	  	Weighted Average
Remaining Recognition
Period
(In years)	 	
Nonvested awards	  	$	7,321	  	  	 	3.2	  	
 
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