
Maryland						52-1494660
(State or other jurisdiction of Incorporation or organization)						~~52-1494660~~ (I.R.S. Employer Identification No.)

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

Title of each class

Trading Symbol

Name of each exchange on which registered

Class A Common Stock, par value $ 0.01 per share

SBGI

The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such file).

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 definitions of ~~“large~~"large accelerated ~~filer”~~filer", ~~“accelerated filer”~~"accelerated filer" and ~~“smaller~~"smaller reporting company,”" and "emerging growth company" in Rule 12b-2 of the Exchange Act. ~~(check one):~~

Large accelerated filerx

☒

Accelerated filero

☐

Non-accelerated filero

☐

Smaller reporting companyo

☐

Emerging growth companyo

☐

~~Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).~~

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth companyo

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Indicate the number of ~~share~~shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.



~~Title of each class~~						Number of shares outstanding as of ~~November 6, 2017~~
Title of each class						November 4, 2022
Class A Common Stock						~~76,071,145~~45,850,774
Class B Common Stock						~~25,670,684~~23,775,056

~~PART I. FINANCIAL INFORMATION~~

Table of Contents

ITEM 1. FINANCIAL STATEMENTS

Table of Contents

SINCLAIR BROADCAST GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(in ~~thousands,~~millions, except share and per share data) (Unaudited)

As of September 30,
2017 As of December 31,
2016
ASSETS

Current assets:

Cash and cash equivalents $ 602,193
$ 259,984
Restricted cash 312,802
200
Accounts receivable, net of allowance for doubtful accounts of $2,510 and $2,124, respectively 523,111
513,954
Current portion of program contract costs 97,768
83,601
Income taxes receivable 5,080
5,500
Prepaid expenses and other current assets 37,384
36,067
Deferred barter costs 11,093
5,782
Total current assets 1,589,431
905,088
Program contract costs, less current portion 4,513
8,919
Property and equipment, net 724,125
717,576
Restricted cash 1,501
—
Goodwill 2,113,651
1,990,746
Indefinite-lived intangible assets 168,720
156,306
Definite-lived intangible assets, net 1,841,938
1,944,403
Notes Receivable from affiliates 19,500
19,500
Other assets 223,690
220,630
Total assets (a) $ 6,687,069
$ 5,963,168
LIABILITIES AND EQUITY (DEFICIT)

Current liabilities:

Accounts payable and accrued liabilities $ 290,848
$ 322,505
Deferred spectrum auction proceeds 310,802
—
Income taxes payable 1,500
23,491
Current portion of notes payable, capital leases and commercial bank financing 164,485
171,131
Current portion of notes and capital leases payable to affiliates 2,183
3,604
Current portion of program contracts payable 130,892
109,702
Deferred barter revenues 10,513
6,040
Total current liabilities 911,223
636,473
Long-term liabilities:

Notes payable, capital leases and commercial bank financing, less current portion 3,876,134
4,014,932
Notes payable and capital leases to affiliates, less current portion 12,824
14,181
Program contracts payable, less current portion 46,026
53,836
Deferred tax liabilities 661,745
609,317
Other long-term liabilities 70,818
76,493
Total liabilities (a) 5,578,770
5,405,232
Commitments and contingencies (See Note 4)

Equity:

Sinclair Broadcast Group shareholders’ equity:

Class A Common Stock, $.01 par value, 500,000,000 shares authorized, 76,032,524 and 64,558,207 shares issued and outstanding, respectively 760
646
Class B Common Stock, $.01 par value, 140,000,000 shares authorized, 25,670,684 and 25,670,684 shares issued and outstanding, respectively, convertible into Class A Common Stock 257
257
Additional paid-in capital 1,318,155
843,691
Accumulated deficit (176,370 ) (255,804 )
Accumulated other comprehensive loss (807 ) (807 )
Total Sinclair Broadcast Group shareholders’ equity 1,141,995
587,983
Noncontrolling interests (33,696 ) (30,047 )
Total equity 1,108,299
557,936
Total liabilities and equity $ 6,687,069
$ 5,963,168

~~The accompanying notes are an integral part of these unaudited consolidated financial statements.~~

~~(a)~~

Our consolidated total assets as of September 30, 2017 and December 31, 2016 include total assets of variable interest entities (VIEs) of $260.7 million and $142.3 million, respectively, which can only be used to settle the obligations of the VIEs. Our consolidated total liabilities as of September 30, 2017 and December 31, 2016 include total liabilities of the VIEs of $160.2 million and $40.9 million, respectively, for which the creditors of the VIEs have no recourse to us. See ~~Note 1. Nature of Operations and Summary of Significant Accounting Policies~~.

~~SINCLAIR BROADCAST GROUP, INC.~~

~~CONSOLIDATED STATEMENTS OF OPERATIONS~~

~~(in thousands, except per share data) (Unaudited)~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
REVENUES:

Media revenues $ 624,169
$ 635,269
$ 1,858,477
$ 1,772,860
Revenues realized from station barter arrangements 31,787
32,061
91,817
92,574
Other non-media revenues 14,935
26,505
49,821
73,824
Total revenues 670,891
693,835
2,000,115
1,939,258
OPERATING EXPENSES:

Media production expenses 267,993
242,880
795,140
702,377
Media selling, general and administrative expenses 133,605
126,672
385,372
370,169
Expenses realized from barter arrangements 26,696
27,181
77,491
79,365
Amortization of program contract costs and net realizable value adjustments 28,047
32,441
87,962
96,722
Other non-media expenses 14,945
20,488
46,921
57,946
Depreciation of property and equipment 24,442
25,886
72,026
74,330
Corporate general and administrative expenses 25,831
19,052
71,458
54,672
Amortization of definite-lived intangible and other assets 43,368
47,807
132,299
137,197
Research and development expenses 2,551
745
5,053
3,055
Gain on asset dispositions (34 ) (3,311 ) (53,531 ) (5,982 )
Total operating expenses 567,444
539,841
1,620,191
1,569,851
Operating income 103,447
153,994
379,924
369,407
OTHER INCOME (EXPENSE):

Interest expense and amortization of debt discount and deferred financing costs (51,743 ) (53,488 ) (160,020 ) (156,819 )
Loss from extinguishment of debt —
(23,699 ) (1,404 ) (23,699 )
(Loss) income from equity and cost method investments (4,362 ) 1,423
(4,221 ) 2,789
Other income, net 2,342
789
5,601
2,355
Total other expense, net (53,763 ) (74,975 ) (160,044 ) (175,374 )
Income before income taxes 49,684
79,019
219,880
194,033
INCOME TAX PROVISION (17,118 ) (26,986 ) (70,577 ) (65,771 )
NET INCOME 32,566
52,033
149,303
128,262
Net income attributable to the noncontrolling interests (1,929 ) (1,188 ) (16,820 ) (3,858 )
NET INCOME ATTRIBUTABLE TO SINCLAIR BROADCAST GROUP $ 30,637
$ 50,845
$ 132,483
$ 124,404
Dividends declared per share $ 0.180
$ 0.180
$ 0.540
$ 0.525
BASIC AND DILUTED EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SINCLAIR BROADCAST GROUP:

Basic earnings per share $ 0.30
$ 0.54
$ 1.34
$ 1.32
Diluted earnings per share $ 0.30
$ 0.54
$ 1.32
$ 1.30
Weighted average common shares outstanding 102,245
93,948
99,210
94,595
Weighted average common and common equivalent shares outstanding 103,055
94,766
100,173
95,465


	As of September 30, 2022		As of December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	607	$	816

Accounts receivable, net of allowance for doubtful accounts of $8 and $7, respectively	586		1,245


Income taxes receivable	171		152
Prepaid sports rights	—		85
Prepaid expenses and other current assets	199		173
Total current assets	1,563		2,471


Property and equipment, net	720		833
Operating lease assets	146		207
Deferred tax assets	—		293
Restricted cash	—		3
Goodwill	2,088		2,088
Indefinite-lived intangible assets	150		150
Customer relationships, net	464		3,904
Other definite-lived intangible assets, net	525		1,184

Other assets	949		1,408
Total assets (a)	$	6,605	$	12,541

LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS, AND EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	412	$	655



Current portion of notes payable, finance leases, and commercial bank financing	43		69
Current portion of operating lease liabilities	23		35
Current portion of program contracts payable	102		97
Other current liabilities	108		346
Total current liabilities	688		1,202

Notes payable, finance leases, and commercial bank financing, less current portion	4,226		12,271
Operating lease liabilities, less current portion	156		205
Program contracts payable, less current portion	12		21
Deferred tax liabilities	465		—
Other long-term liabilities	228		351
Total liabilities (a)	5,775		14,050
Commitments and contingencies (See Note 6)
Redeemable noncontrolling interests	190		197
Shareholders' equity:
Class A Common Stock, $.01 par value, 500,000,000 shares authorized, 46,073,926 and 49,314,303 shares issued and outstanding, respectively	1		1
Class B Common Stock, $.01 par value, 140,000,000 shares authorized, 23,775,056 and 23,775,056 shares issued and outstanding, respectively, convertible into Class A Common Stock	—		—
Additional paid-in capital	623		691
Retained earnings (accumulated deficit)	84		(2,460)
Accumulated other comprehensive loss	(2)		(2)
Total Sinclair Broadcast Group shareholders’ equity (deficit)	706		(1,770)
Noncontrolling interests	(66)		64
Total equity (deficit)	640		(1,706)
Total liabilities, redeemable noncontrolling interests, and equity	$	6,605	$	12,541

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

(a) Our consolidated total assets as of September 30, 2022 and December 31, 2021 include total assets of variable interest entities ("VIE") of $113 million and $217 million, respectively, which can only be used to settle the obligations of the VIEs. Our consolidated total liabilities as of September 30, 2022 and December 31, 2021 include total liabilities of VIEs of $18 million and $62 million, respectively, for which the creditors of the VIEs have no recourse to us. See Note 9. Variable Interest Entities.

Table of Contents

SINCLAIR BROADCAST GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except share and per share data) (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
REVENUES:
Media revenues	$	836	$	1,526	$	2,942	$	4,623
Non-media revenues	7		9		26		35
Total revenues	843		1,535		2,968		4,658

OPERATING EXPENSES:
Media programming and production expenses	396		1,022		1,557		3,390
Media selling, general and administrative expenses	190		228		605		675
Amortization of program contract costs	22		22		68		67
Non-media expenses	12		11		35		42
Depreciation of property and equipment	24		28		76		84
Corporate general and administrative expenses	30		35		115		132
Amortization of definite-lived intangible assets	43		120		179		364

Gain on deconsolidation of subsidiary	—		—		(3,357)		—
Gain on asset dispositions and other, net of impairment	(28)		(4)		(37)		(26)

Total operating expenses (gains)	689		1,462		(759)		4,728
Operating income (loss)	154		73		3,727		(70)

OTHER INCOME (EXPENSE):
Interest expense including amortization of debt discount and deferred financing costs	(59)		(155)		(228)		(466)
Gain on extinguishment of debt	—		—		3		—
Income from equity method investments	33		12		48		23
Other income (expense), net	10		(4)		(155)		59
Total other expense, net	(16)		(147)		(332)		(384)
Income (loss) before income taxes	138		(74)		3,395		(454)
INCOME TAX (PROVISION) BENEFIT	(109)		91		(756)		169
NET INCOME (LOSS)	29		17		2,639		(285)
Net income attributable to the redeemable noncontrolling interests	(5)		(4)		(14)		(13)
Net (income) loss attributable to the noncontrolling interests	(3)		6		(28)		(27)
NET INCOME (LOSS) ATTRIBUTABLE TO SINCLAIR BROADCAST GROUP	$	21	$	19	$	2,597	$	(325)

EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SINCLAIR BROADCAST GROUP:
Basic earnings (loss) per share	$	0.32	$	0.25	$	36.59	$	(4.33)
Diluted earnings (loss) per share	$	0.32	$	0.25	$	36.59	$	(4.33)
Basic weighted average common shares outstanding (in thousands)	69,907		75,472		70,981		75,068
Diluted weighted average common and common equivalent shares outstanding (in thousands)	69,907		75,516		70,985		75,068

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

Table of Contents

SINCLAIR BROADCAST GROUP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in ~~thousands)~~millions) (Unaudited)

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Net income $ 32,566
$ 52,033
$ 149,303
$ 128,262
Comprehensive income 32,566
52,033
149,303
128,262
Comprehensive income attributable to the noncontrolling interests (1,929 ) (1,188 ) (16,820 ) (3,858 )
Comprehensive income attributable to Sinclair Broadcast Group $ 30,637
$ 50,845
$ 132,483
$ 124,404


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net income (loss)	$	29	$	17	$	2,639	$	(285)
Share of other comprehensive income of equity method investments	—		1		3		6


Comprehensive income (loss)	29		18		2,642		(279)
Comprehensive income attributable to the redeemable noncontrolling interests	(5)		(4)		(14)		(13)
Comprehensive (income) loss attributable to the noncontrolling interests	(3)		6		(28)		(27)
Comprehensive income (loss) attributable to Sinclair Broadcast Group	$	21	$	20	$	2,600	$	(319)

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

Table of Contents

SINCLAIR BROADCAST GROUP, INC.

CONSOLIDATED ~~STATEMENT~~STATEMENTS OF EQUITY (DEFICIT) AND REDEEMABLE NONCONTROLLING INTERESTS

(in ~~thousands)~~millions, except share and per share data) (Unaudited)


	Nine Months Ended September 30, 2021
			Sinclair Broadcast Group Shareholders
	Redeemable Noncontrolling Interests		Class A Common Stock			Class B Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interests		Total Deficit
			Shares	Values		Shares	Values
BALANCE, December 31, 2020	$	190	49,252,671	$	1	24,727,682	$	—	$	721	$	(1,986)	$	(10)	$	89	$	(1,185)
Dividends declared and paid on Class A and Class B Common Stock ($0.60 per share)	—		—	—		—	—		—		(46)		—		—		(46)

Class B Common Stock converted into Class A Common Stock	—		952,626	—		(952,626)	—		—		—		—		—		—
Class A Common Stock issued pursuant to employee benefit plans	—		1,505,335	—		—	—		26		—		—		—		26


Distributions to noncontrolling interests, net	(9)		—	—		—	—		—		—		—		(63)		(63)


Other comprehensive income	—		—	—		—	—		—		—		6		—		6
Net income (loss)	13		—	—		—	—		—		(325)		—		27		(298)
BALANCE, September 30, 2021	$	194	51,710,632	$	1	23,775,056	$	—	$	747	$	(2,357)	$	(4)	$	53	$	(1,560)

	Three Months Ended September 30, 2021
			Sinclair Broadcast Group Shareholders
	Redeemable Noncontrolling Interests		Class A Common Stock			Class B Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interests		Total Deficit
			Shares	Values		Shares	Values
BALANCE, June 30, 2021	$	190	51,616,924	$	1	23,775,056	$	—	$	740	$	(2,360)	$	(5)	$	72	$	(1,552)
Dividends declared and paid on Class A and Class B Common Stock ($0.20 per share)	—		—	—		—	—		—		(16)		—		—		(16)


Class A Common Stock issued pursuant to employee benefit plans	—		93,708	—		—	—		7		—		—		—		7


Distributions to noncontrolling interests	—		—	—		—	—		—		—		—		(13)		(13)


Other comprehensive income	—		—	—		—	—		—		—		1		—		1
Net income (loss)	4		—	—		—	—		—		19		—		(6)		13
BALANCE, September 30, 2021	$	194	51,710,632	$	1	23,775,056	$	—	$	747	$	(2,357)	$	(4)	$	53	$	(1,560)

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

Sinclair Broadcast Group Shareholders

Class A
Common Stock

Class B
Common Stock

Additional
Paid-In
Capital

Accumulated
Deficit

Accumulated
Other
Comprehensive
Loss

Noncontrolling
Interests

Total Equity
(Deficit)
Shares Values Shares Values
BALANCE, December 31, 2015 68,792,483
$ 688
25,928,357
$ 259
$ 962,726
$ (437,029 ) $ (834 ) $ (26,132 ) $ 499,678
Cumulative effect of adoption of new accounting standards —
—
—
—
431
1,833
—
—
2,264
Dividends declared and paid on Class A and Class B Common Stock —
—
—
—
—
(49,667 ) —
—
(49,667 )
Repurchases of Class A Common Stock (3,610,201 ) (37 ) —
—
(101,127 ) —
—
—
(101,164 )
Class A Common Stock issued pursuant to employee benefit plans
364,319
4
—
—
14,865
—
—
—
14,869
Distributions to noncontrolling interests —
—
—
—
—
—
—
(8,363 ) (8,363 )
Issuance of subsidiary stock awards —
—
—
—
—
—
—
787
787
Net income —
—
—
—
—
124,404
—
3,858
128,262
BALANCE, September 30, 2016 65,546,601
$ 655
25,928,357
$ 259
$ 876,895
$ (360,459 ) $ (834 ) $ (29,850 ) $ 486,666

Table of Contents

SINCLAIR BROADCAST GROUP, INC.

CONSOLIDATED STATEMENTS OF EQUITY (DEFICIT) AND REDEEMABLE NONCONTROLLING INTERESTS

(in millions, except share and per share data) (Unaudited)


	Nine Months Ended September 30, 2022
			Sinclair Broadcast Group Shareholders
	Redeemable Noncontrolling Interests		Class A Common Stock			Class B Common Stock			Additional Paid-In Capital		(Accumulated Deficit) Retained Earnings		Accumulated Other Comprehensive Loss		Noncontrolling Interests		Total (Deficit) Equity
			Shares	Values		Shares	Values
BALANCE, December 31, 2021	$	197	49,314,303	$	1	23,775,056	$	—	$	691	$	(2,460)	$	(2)	$	64	$	(1,706)
Dividends declared and paid on Class A and Class B Common Stock ($0.75 per share)	—		—	—		—	—		—		(53)		—		—		(53)

Repurchases of Class A Common Stock	—		(4,547,370)	—		—	—		(114)		—		—		—		(114)
Class A Common Stock issued pursuant to employee benefit plans	—		1,306,993	—		—	—		46		—		—		—		46

Distributions to noncontrolling interests	(5)		—	—		—	—		—		—		—		(10)		(10)
Other comprehensive income	—		—	—		—	—		—		—		3		—		3
Deconsolidation of subsidiary	(16)		—	—		—	—		—		—		(3)		(148)		(151)
Net income	14		—	—		—	—		—		2,597		—		28		2,625
BALANCE, September 30, 2022	$	190	46,073,926	$	1	23,775,056	$	—	$	623	$	84	$	(2)	$	(66)	$	640


	Three Months Ended September 30, 2022
			Sinclair Broadcast Group Shareholders
	Redeemable Noncontrolling Interests		Class A Common Stock			Class B Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Noncontrolling Interests		Total Equity
			Shares	Values		Shares	Values
BALANCE, June 30, 2022	$	187	46,470,546	$	1	23,775,056	$	—	$	628	$	79	$	(2)	$	(64)	$	642

Dividends declared and paid on Class A and Class B Common Stock ($0.25 per share)	—		—	—		—	—		—		(16)		—		—		(16)


Repurchases of Class A Common Stock	—		(489,051)	—		—	—		(10)		—		—		—		(10)
Class A Common Stock issued pursuant to employee benefit plans	—		92,431	—		—	—		5		—		—		—		5

Distributions to noncontrolling interests	(2)		—	—		—	—		—		—		—		(5)		(5)



Net income	5		—	—		—	—		—		21		—		3		24
BALANCE, September 30, 2022	$	190	46,073,926	$	1	23,775,056	$	—	$	623	$	84	$	(2)	$	(66)	$	640

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

Table of Contents

SINCLAIR BROADCAST GROUP, INC.

CONSOLIDATED ~~STATEMENT~~STATEMENTS OF ~~EQUITY (DEFICIT)~~CASH FLOWS

(~~In thousands)~~in millions) (Unaudited)


	Nine Months Ended September 30,
	2022		2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	2,639	$	(285)
Adjustments to reconcile net income (loss) to net cash flows from operating activities:

Amortization of sports programming rights	326		1,912
Amortization of definite-lived intangible and other assets	179		364
Depreciation of property and equipment	76		84
Amortization of program contract costs	68		67
Stock-based compensation	46		52
Deferred tax provision (benefit)	759		(92)
Gain on asset dispositions and other, net of impairment	(10)		(24)
Gain on deconsolidation of subsidiary	(3,357)		—
Income from equity method investments	(48)		(23)
Loss (income) from investments	144		(55)
Distributions from investments	74		27
Sports programming rights payments	(325)		(1,338)
Rebate payments to distributors	(15)		(202)
Gain on extinguishment of debt	(3)		—

Change in assets and liabilities, net of acquisitions and deconsolidation of subsidiary:
Decrease (increase) in accounts receivable	48		(116)
Increase in prepaid expenses and other current assets	(95)		(130)
Increase in accounts payable and accrued and other current liabilities	49		80
Net change in net income taxes payable/receivable	(19)		(42)
Decrease in program contracts payable	(78)		(77)

Other, net	—		33
Net cash flows from operating activities	458		235
CASH FLOWS USED IN INVESTING ACTIVITIES:
Acquisition of property and equipment	(74)		(62)

Spectrum repack reimbursements	3		22
Proceeds from sale of assets	9		43
Deconsolidation of subsidiary cash	(315)		—
Purchases of investments	(67)		(244)
Distributions from investments	90		11
Other, net	2		(1)
Net cash flows used in investing activities	(352)		(231)
CASH FLOWS USED IN FINANCING ACTIVITIES:
Proceeds from notes payable and commercial bank financing	728		357
Repayments of notes payable, commercial bank financing and finance leases	(854)		(400)
Repurchase of outstanding Class A Common Stock	(114)		—
Dividends paid on Class A and Class B Common Stock	(53)		(46)
Dividends paid on redeemable subsidiary preferred equity	(5)		(4)

Distributions to noncontrolling interests, net	(10)		(63)
Distributions to redeemable noncontrolling interests	—		(5)
Other, net	(10)		(44)
Net cash flows used in financing activities	(318)		(205)
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	(212)		(201)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period	819		1,262
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of period	$	607	$	1,061

Sinclair Broadcast Group Shareholders

Class A
Common Stock

Class B
Common Stock

Additional
Paid-In
Capital

Accumulated
Deficit

Accumulated
Other
Comprehensive
Loss

Noncontrolling
Interests

Total Equity
(Deficit)
Shares Values Shares Values
BALANCE, December 31, 2016 64,558,207
$ 646
25,670,684
$ 257
$ 843,691
$ (255,804 ) $ (807 ) $ (30,047 ) $ 557,936
Issuance of common stock, net of issuance costs 12,000,000
120
—
—
487,763
—
—
—
487,883
Dividends declared and paid on Class A and Class B Common Stock —
—
—
—
—
(53,049 ) —
—
(53,049 )
Repurchases of Class A Common Stock (997,300 ) (10 ) —
—
(30,277 ) —
—
—
(30,287 )
Class A Common Stock issued pursuant to employee benefit plans 471,617
4
—
—
16,978
—
—
—
16,982
Distributions to noncontrolling interests, net —
—
—
—
—
—
—
(20,469 ) (20,469 )
Net income —
—
—
—
—
132,483
—
16,820
149,303
BALANCE, September 30, 2017 76,032,524
$ 760
25,670,684
$ 257
$ 1,318,155
$ (176,370 ) $ (807 ) $ (33,696 ) $ 1,108,299

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

~~SINCLAIR BROADCAST GROUP, INC.~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(in thousands) (Unaudited)~~

Nine Months Ended September 30,
2017 2016
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES:

Net income $ 149,303
$ 128,262
Adjustments to reconcile net income to net cash flows from operating activities:

Depreciation of property and equipment 72,026
74,330
Amortization of definite-lived intangible and other assets 132,299
137,197
Amortization of program contract costs and net realizable value adjustments 87,962
96,722
Loss on extinguishment of debt, non-cash portion 1,404
3,875
Stock-based compensation expense 12,905
13,470
Deferred tax provision (benefit) (13,285 ) 6,631
Gain on asset dispositions (53,531 ) (5,982 )
Change in assets and liabilities, net of acquisitions:

Decrease (increase) in accounts receivable 2,167
(77,118 )
Increase in prepaid expenses and other current assets (1,057 ) (4,344 )
(Decrease) increase in accounts payable and accrued liabilities (28,237 ) 36,286
Net change in net income taxes payable/receivable (21,571 ) (8,411 )
Payments on program contracts payable (84,499 ) (84,625 )
Other, net 22,525
13,967
Net cash flows from operating activities 278,411
330,260

CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:

Acquisition of property and equipment (55,463 ) (68,601 )
Acquisition of businesses, net of cash acquired (269,799 ) (425,856 )
Purchase of alarm monitoring contracts (5,682 ) (29,143 )
Proceeds from sale of non-media business 192,634
16,396
Investments in equity and cost method investees (22,302 ) (34,224 )
Loans to affiliates —
(19,500 )
Other, net (550 ) 3,401
Net cash flows used in investing activities (161,162 ) (557,527 )

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:

Proceeds from notes payable and commercial bank financing 166,041
1,011,312
Repayments of notes payable, commercial bank financing and capital leases (318,309 ) (653,987 )
Net proceeds from the sale of Class A Common Stock 487,883
—
Dividends paid on Class A and Class B Common Stock (53,049 ) (49,667 )
Distributions to noncontrolling interests (20,469 ) (8,363 )
Repurchase of outstanding Class A Common Stock (30,287 ) (101,164 )
Payments for deferred financing cost (731 ) (15,598 )
Other, net (6,119 ) (693 )
Net cash flows from financing activities 224,960
181,840
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 342,209
(45,427 )
CASH AND CASH EQUIVALENTS, beginning of period 259,984
149,972
CASH AND CASH EQUIVALENTS, end of period $ 602,193
$ 104,545

1.NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Nature of Operations

Sinclair Broadcast Group, Inc. ~~(the Company)~~("SBG," the "Company," or sometimes referred to as "we" or "our") is a diversified ~~television broadcasting~~media company with national reach and a strong focus on providing high-quality content on our local television stations, digital platforms, and, ~~digital platforms.~~prior to the Deconsolidation, as defined below in Deconsolidation of Diamond Sports Intermediate Holdings LLC, regional sports networks. The content, distributed through our broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, college and professional sports, and other original programming produced by us. ~~We also distribute our original programming, and owned and operated network affiliates, on other third-party platforms.~~ Additionally, we own digital media products that are complementary to our extensive portfolio of television station related digital properties. Outside of our media related businesses, we operate technical services companies focused on supply and maintenance of broadcast transmission systems as well as research and development for the advancement of broadcast technology, and we manage other media and non-media related investments.

~~As of~~For the quarter ended September 30, ~~2017, our broadcast distribution platform is a single~~2022, we had one reportable segment for accounting ~~purposes. It~~purposes, broadcast. Prior to the Deconsolidation, as defined below in Deconsolidation of Diamond Sports Intermediate Holdings LLC, we had two reportable segments for accounting purposes, broadcast andlocal sports. The broadcast segment consists primarily of our 185 broadcast television stations in 86 markets, which we own, provide programming and operating services pursuant to agreements commonly referred to as local marketing agreements ~~(LMAs)~~("LMA"), or provide sales services and other non-programming operating services pursuant to other outsourcing agreements (such as joint sales agreements ~~(JSAs)~~("JSA") and shared services agreements ~~(SSAs)~~("SSA") ~~to 192 stations in 89 markets.~~). These stations broadcast ~~586~~638 channels as of September 30, ~~2017.~~2022. For the purpose of this report, these ~~192~~185 stations and ~~586~~638 channels are referred to as ~~“our”~~"our" stations and channels. The local sports segment consisted primarily of our Bally Sports network brands ("Bally RSNs"), the Marquee Sports Network ("Marquee") joint venture, and a minority equity interest in the Yankee Entertainment and Sports Network, LLC ("YES Network") through February 28, 2022. On March 1, 2022, the Bally RSNs, Marquee, and YES Network were deconsolidated from our financial statements. See Deconsolidation of Diamond Sports Intermediate Holdings LLC below. Through February 28, 2022, we refer to the Bally RSNs and Marquee as "the RSNs". The RSNs and YES Network own the exclusive rights to air, among other sporting events, the games of professional sports teams in designated local viewing areas.

Principles of Consolidation

The consolidated financial statements include our accounts and those of our wholly-owned and majority-owned subsidiaries, and ~~variable interest entities (VIEs)~~VIEs for which we are the primary beneficiary. Noncontrolling ~~interest represents~~interests represent a minority owner’s proportionate share of the equity in certain of our consolidated entities. Noncontrolling interests which may be redeemed by the holder, and the redemption is outside of our control, are presented as redeemable noncontrolling interests. All intercompany transactions and account balances have been eliminated in consolidation.

We consolidate VIEs when we are the primary beneficiary. We are the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. See Note 9. Variable Interest Entities for more information on our VIEs.

Investments in entities over which we have significant influence but not control are accounted for using the equity method of accounting. Income from equity method investments represents our proportionate share of net income generated by equity method investees.

Deconsolidation of Diamond Sports Intermediate Holdings LLC

On March 1, 2022, SBG's subsidiary Diamond Sports Intermediate Holdings, LLC, and certain subsidiaries (collectively "DSIH") completed a series of transactions (the "Transaction") which are expected to provide DSIH with approximately $1 billion of liquidity enhancement over the next five years. As part of the Transaction, the governance structure of DSIH was modified including changes to the composition of its Board of Managers, resulting in the Company's loss of voting control. As a result, DSIH, whose operations represented the entirety of our local sports segment, was deconsolidated from our consolidated financial statements effective as of March 1, 2022 (the "Deconsolidation"). The consolidated statement of operations therefore includes two months of activity related to DSIH in the fiscal quarter ended March 31, 2022 prior to the Deconsolidation. Subsequent to February 28, 2022, the assets and liabilities of DSIH are no longer included within our consolidated balance sheets. Any discussions related to results, operations, and accounting policies associated with DSIH are referring to the periods prior to the Deconsolidation.

Upon Deconsolidation, we recognized a gain before income taxes of approximately $3,357 million, which is recorded within gain on deconsolidation of subsidiary in our consolidated statements of operations. Subsequent to the Deconsolidation, we accounted for our equity ownership interest in DSIH under the equity method of accounting. See Note 3. Other Assets for more information.

Interim Financial Statements

The consolidated financial statements for the three and nine months ended September 30, ~~2017~~2022 and ~~2016~~2021 are unaudited. In the opinion of management, such financial statements have been presented on the same basis as the audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income, consolidated ~~statement~~statements of equity (deficit) and redeemable noncontrolling interests, and consolidated statements of cash flows for these periods as adjusted for the adoption of recent accounting ~~pronouncements discussed below.~~pronouncements.

As permitted under the applicable rules and regulations of the Securities and Exchange Commission ~~(SEC)~~(the "SEC"), the consolidated financial statements do not include all disclosures normally included with audited consolidated financial statements and, accordingly, should be read together with the audited consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021 filed with the SEC. The consolidated statements of operations presented in the accompanying consolidated financial statements are not necessarily representative of operations for an entire year.

~~Variable Interest Entities~~

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

~~Third-party station licensees.~~ Certain of our stations provide services to other station owners within the same respective market through agreements, such as LMAs, where we provide programming, sales, operational and administrative services, and JSAs and SSAs, where we provide non-programming, sales, operational and administrative services. In certain cases, we have also entered into purchase agreements or options to purchase the license related assets of the licensee. We typically own the majority of the non-license assets of the stations, and in some cases where the licensee acquired the license assets concurrent with our acquisition of the non-license assets of the station, we have provided guarantees to the bank for the licensee’s acquisition financing. The terms of the agreements vary, but generally have initial terms of over five years with several optional renewal terms. Based on the terms

of the agreements and the significance of our investment in the stations, we are the primary beneficiary when, subject to the ultimate control of the licensees, we have the power to direct the activities which significantly impact the economic performance of the VIE through the services we provide and we absorb losses and returns that would be considered significant to the VIEs. The fees paid between us and the licensees pursuant to these arrangements are eliminated in consolidation. Several of these VIEs are owned by a related party, Cunningham Broadcasting Corporation (Cunningham). See ~~Note 7. Related Person Transactions~~ ~~for more information about the arrangements with Cunningham. See~~ ~~Changes in the Rules of Television Ownership, Joint Sales Agreements, Retransmission Consent Negotiations, and National Ownership Cap~~ ~~within~~ ~~Note 4. Commitments and Contingencies~~ ~~for discussion of recent changes in Federal Communications Commission (FCC) rules related to JSAs.~~

As of the dates indicated, the carrying amounts and classification of the assets and liabilities of the VIEs mentioned above which have been included in our consolidated balance sheets for the periods presented (in thousands):

September 30,
2017 December 31,
2016
ASSETS

Current assets:

Restricted cash $ 122,948
$ —
Accounts receivable 18,820
21,879
Other current assets 12,851
12,076
Total current assets 154,619
33,955

Program contract costs, less current portion 1,091
2,468
Property and equipment, net 6,418
2,996
Goodwill and indefinite-lived intangible assets 16,475
16,475
Definite-lived intangible assets, net 76,487
79,509
Other assets 5,601
6,871
Total assets $ 260,691
$ 142,274

LIABILITIES

Current liabilities:

Deferred spectrum auction proceeds $ 122,948
$ —
Other current liabilities 23,899
18,992

Long-term liabilities:

Notes payable, capital leases and commercial bank financing, less current portion 15,043
19,449
Program contracts payable, less current portion 12,063
14,353
Other long-term liabilities 8,452
12,921
Total liabilities $ 182,405
$ 65,715

The amounts above represent the consolidated assets and liabilities of the VIEs described above, for which we are the primary beneficiary, and have been aggregated as they all relate to our broadcast business. Excluded from the amounts above are payments made to Cunningham under the LMAs and certain outsourcing agreements which are treated as a prepayment of the purchase price of the stations and capital leases between us and Cunningham which are eliminated in consolidation. The total payments made under these LMAs and certain JSAs as of September 30, 2017 and December 31, 2016, which are excluded from liabilities above, were $42.8 million and $40.8 million, respectively. The total capital lease liabilities, net of capital lease assets, excluded from the above were $4.7 million and $4.5 million for the years ended September 30, 2017 and December 31, 2016, respectively. Also excluded from the amounts above are liabilities associated with certain outsourcing agreements and purchase options with certain VIEs totaling $78.1 million and $74.5 million as of September 30, 2017 and December 31, 2016, respectively, as these amounts are eliminated in consolidation. The assets of each of these consolidated VIEs can only be used to settle the obligations of the VIE. All the liabilities are non-recourse to us except for certain debt of VIEs which we guarantee. The risk and reward characteristics of the VIEs are similar.

~~Other investments.~~ We have investments in real estate ventures and investment companies which are considered VIEs. However, we do not participate in the management of these entities including the day-to-day operating decisions or other decisions which

~~would allow us to control the entity, and therefore, we are not considered the primary beneficiary of these VIEs. We account for these entities using the equity or cost method of accounting.~~

The carrying amounts of our investments in these VIEs for which we are not the primary beneficiary as of September 30, 2017 and December 31, 2016 are $105.2 million and $117.0 million, respectively, and are included in other assets in the consolidated balance sheets. Our maximum exposure is equal to the carrying value of our investments. The income and loss related to these investments are recorded in income from equity and cost method investments in the consolidated statement of operations. We recorded loss of $1.3 million and income of $2.1 million for the three and nine months ended September 30, 2017, and income of $1.4 million and $2.8 million for the three and nine months ended September 30, 2016, respectively.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of

America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses in the consolidated financial statements and in the disclosures of contingent assets and liabilities. Actual results could differ from those estimates.

The impact of the war in Ukraine and the novel coronavirus ("COVID-19") continues to create significant uncertainty and disruption in the global economy and financial markets. It is reasonably possible that these uncertainties could further materially impact our estimates related to, but not limited to, revenue recognition, goodwill and intangible assets, program contract costs and income taxes. As a result, many of our estimates and assumptions require increased judgment and carry a higher degree of variability and volatility. Our estimates may change as new events occur and additional information emerges, and such changes are recognized or disclosed in our consolidated financial statements.

Recent Accounting Pronouncements

In ~~May 2014,~~March 2020, the ~~Financial Accounting Standards Board (FASB)~~FASB issued guidance providing optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate ("LIBOR") or by another reference rate expected to be discontinued. The guidance was effective for all entities immediately upon issuance of the update and may be applied prospectively to applicable transactions existing as of or entered into from the date of adoption through December 31, 2022. We adopted this guidance upon issuance and it did not have an impact on ~~revenue recognition~~our consolidated financial statements.

In October 2021, the FASB issued guidance to improve the accounting for acquired revenue ~~from~~ contracts with ~~customers. This~~customers in a business combination by addressing diversity in practice. ASU 2021-08 requires that an acquiring entity recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, as if it had originated the contracts. The guidance requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers and will replace most existing revenue recognition guidance when it becomes effective. The new standard will beis effective for ~~annual reporting periods~~fiscal years beginning after December 15, ~~2017. The standard permits the use of either the retrospective or cumulative effect transition method. Since ASU 2014-09 was issued, several additional ASUs have been issued and incorporated~~2022, including interim periods within ASC 606 to clarify various elements of the guidance. We have not finalized our assessment of the impact of this guidance on our consolidated financial statements. However, we do not currently believe that the adoption of this guidance will have a material impact on our station advertising or retransmission consent revenue. We have determined that under the new standard, certain barter revenue and expense related to syndicated programming will no longer be recognized. Barter revenues and expenses for the three and nine months ending September 30, 2017 was $26.4 million and $76.4 million, respectively.

In January 2016, the FASB issued new guidance which address certain aspects of recognition, measurement, presentation, and disclose of financial instruments. The new guidance requires entities to measure equity investments (except those accounted for under the equity method of accounting or those that resulted in consolidation of the investee) at fair value, with changes in fair value recognized in net income. The new standard is effective for the interim and annual periods beginning after December 15, 2017.fiscal years. We are currently evaluating the impact of this guidance, but do not expect a material impact on our consolidated financial statements.

~~In February 2016,~~

Broadcast Television Programming

We have agreements with programming syndicators for the ~~FASB issued new guidance related~~rights to television programming over contract periods, which generally run from one to seven years. Contract payments are made in installments over terms that are generally equal to or shorter than the contract period. Pursuant to accounting guidance for ~~leases, which requires~~ the ~~assets~~broadcasting industry, an asset and ~~liabilities that arise from leases to be recognized~~a liability for the rights acquired and obligations incurred under a license agreement are reported on the balance ~~sheet. Currently only capital leases are recorded on~~sheet when the ~~balance sheet. This update will require~~cost of each program is known or reasonably determinable, the ~~lessee to recognize a lease liability equal to~~program material has been accepted by the ~~present value~~licensee in accordance with the conditions of the ~~lease payments~~license agreement, and the program is available for its first showing or telecast. The portion of program contracts which becomes payable within one year is reflected as a ~~right-of-use asset representing its right~~current liability in the accompanying consolidated balance sheets.

The rights to ~~use~~this programming are reflected in the ~~underlying asset for~~accompanying consolidated balance sheets at the ~~lease term for all leases longer than 12 months. For leases with a term~~lower of ~~12 months~~unamortized cost or ~~less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and liabilities and recognize the lease expense for such leases generally~~fair value. Program contract costs are amortized on a straight-line basis except for contracts greater than three years which are amortized utilizing an accelerated method. Program contract costs estimated by management to be amortized in the succeeding year are classified as current assets. Payments of program contract liabilities are typically made on a scheduled basis and are not affected by amortization or fair value adjustments.

Fair value is determined utilizing a discounted cash flow model based on management’s expectation of future advertising revenues, net of sales commissions, to be generated by the program material. We assess our program contract costs on a quarterly basis to ensure the costs are recorded at the lower of unamortized cost or fair value.

Sports Programming Rights

DSIH has multi-year program rights agreements that provide DSIH with the right to produce and telecast professional live sports games within a specified territory in exchange for a rights fee. Prior to the Deconsolidation, a prepaid asset was recorded for rights acquired related to future games upon payment of the contracted fee. The assets recorded for the acquired rights were classified as current or non-current based on the period when the games were expected to be aired. Liabilities were recorded for any program rights obligations that had been incurred but not yet paid at period end. We amortized these rights as an expense over each season based upon contractually stated rates. Amortization was accelerated in the event that the stated contractual rates over the term of the rights agreement resulted in an expense recognition pattern that was inconsistent with the projected growth of revenue over the contractual term.

The National Basketball Association ("NBA") and the National Hockey League ("NHL") delayed the start of their 2020-2021 seasons until December 22, 2020 and January 13, 2021, respectively, and both leagues postponed games in the fourth quarter 2021 and rescheduled these games to be played in the first quarter 2022. The sports rights expense associated with these seasons was recognized over the modified term of these seasons.

Non-cash Investing and Financing Activities

Leased assets obtained in exchange for new operating lease ~~term. This~~liabilities were $9 million and $11 million for the nine months ended September 30, 2022 and 2021, respectively. Leased assets obtained in exchange for new ~~guidance~~finance lease liabilities were $1 million for the nine months ended September 30, 2022. During the nine months ended September 30, 2021, we received preferred shares in an investment valued at $6 million in exchange for an equivalent value of advertising spots.

The following table presents our revenue disaggregated by type and segment (in millions):


For the three months ended September 30, 2022	Broadcast		Local sports		Other		Eliminations		Total
Distribution revenue	$	381	$	—	$	44	$	—	$	425
Advertising revenue	339		—		46		(11)		374
Other media, non-media, and intercompany revenues	33		—		13		(2)		44
Total revenues	$	753	$	—	$	103	$	(13)	$	843

For the three months ended September 30, 2021	Broadcast		Local sports		Other		Eliminations		Total
Distribution revenue	$	372	$	633	$	48	$	—	$	1,053
Advertising revenue	283		118		55		(10)		446
Other media, non-media, and intercompany revenues	46		8		14		(32)		36
Total revenues	$	701	$	759	$	117	$	(42)	$	1,535

For the nine months ended September 30, 2022	Broadcast		Local sports		Other		Eliminations		Total
Distribution revenue	$	1,158	$	433	$	137	$	—	$	1,728
Advertising revenue	937		44		184		(54)		1,111
Other media, non-media, and intercompany revenues	111		5		47		(34)		129
Total revenues	$	2,206	$	482	$	368	$	(88)	$	2,968

For the nine months ended September 30, 2021	Broadcast		Local sports		Other		Eliminations		Total
Distribution revenue	$	1,096	$	1,997	$	147	$	—	$	3,240
Advertising revenue	830		345		149		(16)		1,308
Other media, non-media, and intercompany revenues	127		23		49		(89)		110
Total revenues	$	2,053	$	2,365	$	345	$	(105)	$	4,658

Distribution Revenue. We have agreements with multi-channel video programming distributors ("MVPD") and virtual MVPDs ("vMVPD," and together with MVPDs, "Distributors"). We generate distribution revenue through fees received from these Distributors for the right to distribute our stations, RSNs, and other properties. Distribution arrangements are generally governed by multi-year contracts and the underlying fees are based upon a contractual monthly rate per subscriber. These arrangements represent licenses of intellectual property; revenue is recognized as the signal or network programming is provided to our customers (as usage occurs) which corresponds with the satisfaction of our performance obligation. Revenue is calculated based upon the contractual rate multiplied by an estimated number of subscribers. Our customers will ~~be effective for fiscal periods beginning~~remit payments based upon actual subscribers a short time after ~~December 15, 2018, including interim periods~~the conclusion of a month, which generally does not exceed 120 days. Historical adjustments to subscriber estimates have not been material.

Advertising Revenue. We generate advertising revenue primarily from the sale of advertising spots/impressions within ~~that reporting period. Early adoption is permitted. We are currently evaluating the impact of this guidance on~~ our ~~consolidated financial statements.~~broadcast television, RSN, and digital platforms.

In ~~August 2016,~~accordance with ASC 606, we do not disclose the ~~FASB issued new guidance related to the classification~~value of ~~certain cash receipts~~unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and ~~cash payments. The new standard,~~(ii) distribution arrangements which ~~includes eight specific cash flow issues with the objective~~are accounted for as a sales/usage based royalty.

Deferred Revenue. We record deferred revenue when cash payments are ~~represented~~received or due in ~~the statement~~advance of ~~cash flow. The new standard is effective for fiscal year beginning after December 15, 2017,~~our performance, including ~~the interim periods within that reporting period. Early adoption is permitted.~~amounts which are refundable. We ~~are currently evaluating the impact of this guidance on~~classify deferred revenue as either current in other current liabilities or long-term in other long-term liabilities in our consolidated ~~financial statements.~~

~~In October 2016,~~balance sheets based on the ~~FASB issued new guidance related~~timing of when we expect to ~~the accounting for income tax consequences~~satisfy our performance obligations. Deferred revenue was $244 million and $235 million as of ~~intra-entity transfers~~September 30, 2022 and December 31, 2021, respectively, of ~~assets~~which $149 million and $164 million, respectively, was reflected in other than inventory. Currently the recognition of current and deferred income taxes for an intra-entity are prohibited until the asset has been sold to an outside party. This update requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. We adopted this guidancelong-term liabilities in our consolidated balance sheets. Deferred revenue recognized during the ~~first quarter of 2017. The impact of the adoption did not have a material impact on our financial statements.~~

~~In October 2016, the FASB issued new guidance which relates to related party considerations in the variable interest entities assessment. The new standard is effective for the interim~~nine months ended September 30, 2022 and ~~annual periods beginning after December 15, 2017. We adopted this guidance during the first quarter of 2017. The impact of the adoption did not have a material impact on our financial statements.~~

In November 2016, FASB issued new guidance related to the classification and presentation of changes in restricted cash on the statement of cash flows. This new standard requires that a statement of cash flow explain change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling from period to period as shown on the cash flow. The new standard is effective for the fiscal year beginning after December 15, 2017, including the interim periods within that reporting period. Early adoption is permitted. Upon adoption, we will retrospectively reconcile the consolidated statement of cash flows to the restricted cash balance2021, included in the ~~consolidated~~deferred revenue balance ~~sheet for~~as of December 31, 2021 and 2020, was $53 million and $38 million, respectively.

For the ~~period presented in our financial statements. We are currently evaluating the method of presentation on our financial statements.~~

~~In January 2017, the FASB issued guidance which clarifies the definition of a business with additional guidance to assist entities with evaluating whether transactions should be~~three months ended September 30, 2022, one customer accounted for ~~as acquisitions (or disposals)~~11% of ~~assets or businesses. The new standard should be applied prospectively~~our total revenues. For the nine months ended September 30, 2022, three customers accounted for 14%, 12%, and ~~is effective~~11%, respectively, of our total revenues. For the three months ended September 30, 2021, three customers accounted for 19%, 17%, and 14%, respectively, of our total revenues. For the ~~interim~~nine months ended September 30, 2021, three customers accounted for 19%, 18%, and ~~annual periods beginning after December 15, 2017. We do not expect the adoption~~14%, respectively, of our total revenues. As of September 30, 2022, two customers accounted for 11% and 10%, respectively, of our accounts receivable, net. For purposes of this ~~guidance will have~~disclosure, a ~~material impact on our financial statements.~~single customer may include multiple entities under common control.

In January 2017, the FASB issued guidance which eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. The new standard should be applied prospectively and is effective for the interim and annual periods beginning after December 15, 2019. Early adoption is permitted. We adopted this guidance during the first quarter of 2017. The impact of the adoption did not have a material impact on our financial statements.

In May 2017, the FASB issued new guidance which relates to stock based compensation and clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The new standard is effective for the interim and annual periods beginning after December 15, 2017. We adopted this guidance during the second quarter of 2017. The impact of the adoption did not have a material impact on our financial statements.

~~Broadcast Incentive Auction~~

Congress authorized the FCC to conduct so-called “incentive auctions” to auction and re-purpose broadcast television spectrum for mobile broadband use. Pursuant to the auction, television broadcasters submitted bids to receive compensation for relinquishing all or a portion of its rights in the television spectrum of their full-service and Class A stations. Low power stations were not eligible to participate in the auction and are not protected and therefore may be displaced or forced to go off the air as a result of the post-auction repacking process. On April 13, 2017, the FCC issued a public notice which announced the conclusion of the spectrum auction. In July 2017, we received $310.8 million of gross proceeds from the auction. These proceeds are reflected as restricted cash because we directed the FCC to deposit those proceeds with the qualifying intermediaries accounts to facilitate potential like kind exchange transactions.

We are limited in our ability to access this cash for a period of time which ends at the earlier of the date that we close on the acquisition of qualifying replacement property or 180 days from the date that the cash was received. We received the auction proceeds in advance of vacating the spectrum sold in the auction; as a result, we have recorded a corresponding deferred liability of $310.8 million. We expect to recognize a gain of approximately $308.2 million once we vacate/cease using the spectrum sold in the auction which we expect will occur during the first quarter of 2018. The results of the auction are not expected to produce any material change in operations of the Company as there is no change in on air operations.

In the repacking process associated with the auction, the FCC has reassigned some stations to new post-auction channels. We do not expect reassignment to new channels to have a material impact on our coverage. We have received notification from the FCC that 98 of our stations have been assigned to new channels. The legislation authorizing the incentive auction provides the FCC with a $1.75 billion fund to reimburse reasonable costs incurred by stations that are reassigned to new channels in the repack. We expect that the reimbursements from the fund will cover the majority of our expenses related to the repack. However, we cannot predict whether the fund will be sufficient to reimburse all of our expenses. The sufficiency of the fund is dependent upon a number of factors including the amounts to be reimbursed to other industry participants for repacking costs.

~~Revenue Recognition~~

Total revenues include: (i) station advertising revenue, net of agency commissions; (ii) barter advertising revenues; (iii) retransmission consent fees; (iv) other media revenues and (v) revenues from our other businesses.

~~Advertising revenues, net of agency commissions, are recognized in the period during which advertisements are placed.~~

Some of our retransmission consent agreements contain both advertising and retransmission consent elements. We have determined that these retransmission consent agreements are revenue arrangements with multiple deliverables. Advertising and retransmission consent deliverables sold under our agreements are separated into different units of accounting at fair value. Revenue applicable to the advertising element of the arrangement is recognized similar to the advertising revenue policy noted above. Revenue applicable to the retransmission consent element of the arrangement is recognized over the life of the agreement.

Our income tax provision for all periods consists of federal and state income taxes. The tax provision for the three and nine months ended September 30, ~~2017~~2022 and ~~2016~~2021 is based on the estimated effective tax rate applicable for the full year after taking into account discrete tax items and the effects of the noncontrolling interests. We provide a valuation allowance for deferred tax assets if we determine that it is more likely than not that some or all of the deferred tax assets will not be realized. In evaluating our ability to realize net deferred tax assets, we consider all available evidence, both positive and negative, including our past operating results, tax planning strategies and forecasts of future taxable income. In considering these sources of taxable income, we must make certain judgments that are based on the plans and estimates used to manage our underlying businesses on a long-term basis. A valuation allowance has been provided for deferred tax assets related to interest expense carryforwards under the Internal Revenue Code (IRC) Section 163(j) and a substantial ~~portion~~amount of our available state net operating loss ~~(NOL)~~ carryforwards based on past operating results, expected timing of the reversals of existing temporary book/tax basis differences, alternative tax strategies, and projected future taxable income.

Our effective income tax rate for the three and nine months ended September 30, ~~2017 and 2016, approximated~~2022, was greater than the statutory rate primarily due to an increase in valuation allowance on deferred tax assets relating to deductibility of interest expense under the IRC Section 163(j). Our effective income tax rate for the nine months ended September 30, 2022, approximated our statutory rate.

~~Equity Offering~~Our effective income tax rate for the three and nine months ended September 30, 2021 was greater than the statutory rate primarily due to a release of valuation allowance on deferred tax assets relating to deductibility of interest expense under the IRC Section 163(j), and a discrete benefit as a result of the CARES Act allowing for the 2020 federal net operating loss to be carried back to pre-2018 years when the federal tax rate was 35%.

~~On March 15, 2017, we issued~~We do not believe that our liability for unrecognized tax benefits would be materially impacted, in the next twelve months, as a result of the expected statute of limitations expirations, the application of limits under available state administrative practice exceptions, and ~~sold 12.0 million shares~~the resolution of ~~Class A Common stock to the public at a price of $42.00 per share. The proceeds from the offering, net of financing costs, were approximately $487.9 million~~examination issues and ~~are intended to fund future potential acquisitions~~settlements with federal and ~~general corporate purposes.~~certain state tax authorities.

Share Repurchase Program

On ~~March 20, 2014, the Board of Directors authorized a $150.0 million share repurchase authorization. On September 6, 2016~~August 4, 2020, the Board of Directors authorized an additional ~~$150.0~~$500 million ~~shares repurchases authorization.~~share repurchase authorization in addition to the previous repurchase authorization of $1 billion. There is no expiration date and currently, management has no plans to terminate this program. For the ~~three and~~ nine months ended September 30, ~~2017,~~2022, we ~~purchased~~repurchased approximately ~~1.0~~five million shares of Class A Common Stock for ~~$30.3~~$114 million. As of September 30, ~~2017,~~2022, the total remaining ~~repurchase~~purchase authorization ~~is $88.8~~was $704 million. As of November 4, 2022, we repurchased an additional 0.3 million shares of Class A Common Stock, for $6 million since September 30, 2022. All shares were repurchased under an SEC Rule 10b5-1 plan.

~~Subsequent Events~~

~~In October 2017, our Board of Directors declared a quarterly dividend of $0.18 per share, payable on December 15, 2017 to holders of record at the close of business on December 1, 2017.~~

Certain reclassifications have been made to prior years' consolidated financial statements to conform to the current year's presentation.

2.ACQUISITIONS AND ~~DISPOSITION~~DISPOSITIONS OF ASSETS:

~~2017 Acquisitions.~~

~~Bonten .~~ ~~On September 1, 2017, we acquired~~Broadcast Incentive Auction. In 2012, Congress authorized the ~~stock~~Federal Communications Commission ("FCC") to conduct so-called "incentive auctions" to auction and re-purpose broadcast television spectrum for mobile broadband use. Pursuant to the auction, television broadcasters submitted bids to receive compensation for relinquishing all or a portion of ~~Bonten Media Group Holdings, Inc. (Bonten)~~their rights in the television spectrum of their full-service and ~~Cunningham acquired~~Class A stations. Low power stations were not eligible to participate in the ~~membership interest of Esteem Broadcasting (Esteem) for an aggregate purchase price of $240 million plus a working capital adjustment, excluding cash acquired, of $1.3 million accounted for~~auction and are not protected and therefore may be displaced or forced to go off the air as ~~a business combination under the acquisition method of accounting. As~~ a result of the ~~transaction~~post-auction repacking process.

In March 2016, the FCC began the repacking process associated with the auction, in which the FCC reassigned some stations to new post-auction channels. We do not expect reassignment to new channels to have a material impact on our coverage. As part of that process, we ~~added 14 television~~received notification from the FCC that 100 of our stations have been assigned to new channels. Legislation has provided the FCC with a $3 billion fund to reimburse reasonable costs incurred by stations that are reassigned to new channels in ~~8 markets: Tri-Cities, TN/VA; Greensville/New Bern/Washington, NC; Chico/Redding, CA; Abilene/Sweetwater, TX; Missoula, MT; Butte/Bozeman, MT; San Angelo, TX; and Eureka, CA. Cunningham assumed~~ the ~~joint sales agreement under which we will provide services~~repack. We recorded gains related to 4 additional stations. The transaction was funded through cash on hand. The acquisition will expand our regional presence in several states where we already operate and help us bring improvements to small market stations.

~~The following table summarizes the allocated fair value~~reimbursements for spectrum repack costs incurred of ~~acquired assets and assumed liabilities (in thousands):~~

Accounts receivable 14,665
Prepaid expenses and other current assets 699
Program contract costs 683
Property and equipment 23,019
Definite-lived intangible assets 157,979
Indefinite-lived intangible assets 8,363
Other assets 3,609
Accounts payable and accrued liabilities (8,481 )
Program contracts payable (783 )
Deferred tax liability (65,789 )
Other long term liabilities (3,409 )
Fair value of identifiable net assets acquired 130,555
Goodwill 110,716
Total purchase price, net of cash acquired $ 241,271

The preliminary purchase price allocation presented above is based upon management’s estimate of the fair value of the acquired assets and assumed liabilities using valuation techniques including income, cost and market approaches. The fair value estimates are based on, but not limited to, expected future revenue and cash flows, expected future growth rates, and estimated discount rates. The allocation is preliminary pending a final determination of the fair value of the assets and liabilities.

~~The definite-lived intangible assets of $158.0 million is comprised of network affiliations of $49.5~~$1 million and customer relationships of $108.5 million. These intangible assets will be amortized over a weighted average useful life of 14 years for network affiliations and other intangible assets. Acquired property and equipment will be depreciated on a straight-line basis over the respective estimated remaining useful lives. Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and noncontractual relationships, as well as expected future synergies. We expect that goodwill deductible for tax purposes will be approximately $5.6 million.

In connection with the acquisition for the three and nine months ended September 30, 2017, we incurred a total of $0.3 million and $0.8 million, respectively, of costs primarily related to legal and other professional services which we expensed as incurred and classified as corporate general and administrative expenses in the consolidated statements of operations. Net revenues and operating income of the Bonten stations in our consolidated statements of operations, were $7.6 million and $0.9$3 million for the three and nine months ended September 30, ~~2017.~~

~~Other 2017 Acquisitions.~~ ~~During 2017,we acquired certain media assets for an aggregate $27 million, less working capital of $2.8 million~~. ~~The transactions were funded with cash on hand.~~

~~2016 Acquisitions.~~

~~Tennis Channel.~~ ~~In March 2016, we acquired all of the outstanding common stock of Tennis Channel (Tennis), a cable network which includes coverage of the top 100 tennis tournaments~~2022, respectively, and original professional sport and tennis lifestyle shows for $350.0 million plus a working capital adjustment, excluding cash acquired, of $4.1 million accounted for as a business combination under the acquisition method of accounting. The transaction was funded through cash on hand and a draw on the Bank Credit Agreement. The acquisition provides an expansion of our network business and increases value based on the synergies we can achieve. Tennis is reported within Other within ~~Note 6. Segment Data~~.

~~The following table summarizes the allocated fair value of acquired assets and assumed liabilities (in thousands):~~

The purchase price allocation presented above is based upon management’s estimate of the fair value of the acquired assets and assumed liabilities using valuation techniques including income, cost and market approaches. The fair value estimates are based on, but not limited to, expected future revenue and cash flows, expected future growth rates, and estimated discount rates.

The definite-lived intangible assets of $272.7 million related primarily to customer relationships, which represent existing advertiser relationships and contractual relationships with multi-channel video programming distributors (MVPDs) and will be amortized over a weighted average useful life of 15 years. Acquired property and equipment will be depreciated on a straight-line basis over the respective estimated remaining useful lives. Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and noncontractual relationships, as well as expected future synergies. Goodwill will not be deductible for tax purposes.

In connection with the acquisition, for the year ended December 31, 2016, we incurred a total of $0.2 million of costs primarily related to legal and other professional services which we expensed as incurred and classified as corporate general and administrative expenses in the consolidated statements of operations.

~~Net revenues of Tennis included in our consolidated statements of operations, were $33.9~~$3 million and ~~$103.2~~$22 million for the three and nine months ended September 30, ~~2017,~~2021, respectively, which are included within gain on asset dispositions and ~~$27.4~~other, net of impairment in our consolidated statements of operations. Capital expenditures related to the spectrum repack were $0.1 million and ~~$62.5~~$1 million for the three and nine months ended September 30, ~~2016, respectively. Our consolidated statements of operations included operating income of Tennis of $3.0~~2022, respectively, and $1 million and ~~$8.1~~$10 million for the three and nine months ended September 30, ~~2017, respectively,~~2021, respectively. The reimbursements we have received throughout this process have covered the majority of the expenses we incurred related to the repack.

Other assets as of September 30, 2022 and December 31, 2021 consisted of the following (in millions):


	As of September 30, 2022		As of December 31, 2021
Equity method investments	$	131	$	517
Other investments	418		567
Note receivable	193		—
Post-retirement plan assets	39		50
Other	168		274
Total other assets	$	949	$	1,408

Equity Method Investments

We have a portfolio of investments, including an ~~operating~~investment in the YES Network (prior to the Deconsolidation), our investment in DSIH (subsequent to the Deconsolidation), and also a number of entities that are primarily focused on the development of real estate and other media and non-media businesses. No investments were individually significant for the periods presented.

YES Network Investment. Prior to the Deconsolidation, we accounted for our investment in the YES Network as an equity method investment, which was recorded within other assets in our consolidated balance sheets, and in which our proportionate share of the net income or loss generated by the investment was included within income from equity method investments in our consolidated statements of operations. We recorded income of ~~$1.3~~$10 million for the nine months ended September 30, 2022 and income of $10 million and ~~an operating loss of $9.6~~$29 million for the three and nine months ended September 30, ~~2016,~~2021, respectively. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

~~Other 2016 Acquisitions.~~ ~~During~~Diamond Sports Intermediate Holdings LLC. Subsequent to the ~~year~~Deconsolidation, we began accounting for our equity interest in DSIH under the equity method of accounting. As of March 1, 2022, we reflected the investment in DSIH at fair value, which was determined to be nominal. For the three and nine months ended ~~December 31, 2016,~~September 30, 2022 we ~~acquired certain television station~~recorded no equity method loss related ~~assets for an aggregate purchase price of $72.0 million less working capital of $0.1 million. We also exchanged certain broadcast assets whichhad a~~to the investment because the carrying value of ~~$23.8~~the investment is zero and we are not obligated to fund losses incurred by DSIH. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

We measure our investments, excluding equity method investments, at fair value or, in situations where fair value is not readily determinable, we have the option to value investments at cost plus observable changes in value, less impairment. Additionally, certain investments are measured at net asset value ("NAV").

As of September 30, 2022 and December 31, 2021, we held $216 million ~~with another broadcaster for no cash consideration,~~ and $402 million, respectively, in investments measured at fair value and $185 million and $147 million, respectively, in investments measured at NAV. We recognized a fair value adjustment gain ~~on the derecognition~~ of ~~those broadcast assets~~$4 million and loss of ~~$4.4~~$157 million ~~respectively.~~

~~Pro Forma Information.~~ ~~The following table sets forth unaudited results of operations, assuming that Bonten~~ for the three and nine months ended September 30, ~~2017~~2022, respectively, and ~~2016~~a fair value adjustment loss of $2 million and ~~that Tennis~~gain of $60 million for the three and nine months ended September 30, 2021, respectively, associated with these investments, which are reflected in other income (expense), net in our consolidated statements of operations. As of September 30, 2022 and December 31, 2021, our unfunded commitments related to our investments valued using the NAV practical expedient totaled $92 million and $81 million, respectively.

Investments accounted for utilizing the measurement alternative were $17 million, net of $7 million of cumulative impairments, as of September 30, 2022, and $18 million, net of $7 million of cumulative impairments, as of December 31, 2021. There were no adjustments to the carrying amount of investments accounted for utilizing the measurement alternative for any of the three and nine months ended September 30, 2022 or 2021.

On November 5, 2021, we purchased and assumed the lenders’ and the administrative agent’s rights and obligations under the Accounts Receivable Securitization Facility ("A/R Facility"), held by Diamond Sports Finance SPV, LLC ("DSPV"), an indirect wholly-owned subsidiary of DSIH, by making a payment to the lenders equal to approximately $184 million, representing 101% of the aggregate outstanding principal amount of the loans under the A/R Facility, plus any accrued interest and outstanding fees and expenses. The maximum facility limit availability under the A/R Facility is $400 million and has a maturity date of September 23, 2024. Subsequent to the Deconsolidation, transactions related to the A/R Facility are no longer intercompany transactions and, therefore, are reflected in our consolidated financial statements. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies. As of September 30, 2022, the note receivable due to the Company is approximately $193 million which is recorded within other assets in our consolidated balance sheets.

4.NOTES PAYABLE, FINANCE LEASES, AND COMMERCIAL BANK FINANCING:

Bank Credit Agreement and Notes

The bank credit agreement of Sinclair Television Group, Inc. ("STG"), a wholly owned subsidiary of the Company, (the "Bank Credit Agreement") includes a financial maintenance covenant, the first lien leverage ratio (as defined in the Bank Credit Agreement), which requires such ratio not to exceed 4.5x, measured as of the end of each fiscal quarter. As of September 30, 2022, the STG first lien leverage ratio was below 4.5x. Under the Bank Credit Agreement, a financial maintenance covenant is only applicable if 35% or more of the capacity (as a percentage of total commitments) under the revolving credit facility, measured as of the last day of each fiscal quarter, is utilized under the revolving credit facility as of such date. Since there was no utilization under the revolving credit facility as of September 30, 2022, STG was not subject to the financial maintenance covenant under the Bank Credit Agreement. The Bank Credit Agreement contains other restrictions and covenants with which STG was in compliance as of September 30, 2022.

On April 21, 2022, STG entered into the Fourth Amendment (the "Fourth Amendment") to the Bank Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent, the guarantors party thereto (the "Guarantors") and the lenders and other parties thereto.

Pursuant to the Fourth Amendment, STG raised Term B-4 Loans (as defined in the Bank Credit Agreement) in an aggregate principal amount of $750 million, which mature on April 21, 2029 (the "Term Loan B-4"). The Term Loan B-4 was issued at 97% of par and bears interest, at STG’s option, at Term Secured Overnight Financing Rate plus 3.75% (subject to customary credit spread adjustments) or base rate plus 2.75%. The proceeds from the Term Loan B-4 were used to refinance all of STG’s outstanding Term Loan B-1 due January 2024 and to redeem STG’s outstanding 5.875% senior notes due 2026 (the "STG 5.875% Notes"). In addition, the maturity of $612.5 million of the total $650 million of revolving commitments under the Bank Credit Agreement were extended to April 21, 2027, with the remaining $37.5 million continuing to mature on December 4, 2025. For the nine months ended September 30, 2022, we capitalized an original issuance discount of $23 million associated with the issuance of the Term Loan B-4, which is reflected as a reduction to the outstanding debt balance and will be recognized as interest expense over the term of the outstanding debt utilizing the effective interest method. The balance of the Term Loan B-4 was $726 million, net of debt discount and deferred financing costs, as of September 30, 2022. We recognized a loss on extinguishment of $10 million for the nine months ended September 30, ~~2016, along with~~2022.

During the nine months ended September 30, 2022, we purchased $118 million aggregate principal amount of STG's 5.125% senior notes due 2027 (the "STG 5.125% Notes") in open market transactions ~~necessary to finance the acquisition, occurred at the beginning~~for consideration of ~~the year preceding the year of acquisition.~~$104 million. The ~~pro forma results exclude the other acquisitions discussed above, as they were deemed not material both individually and in the aggregate (in thousands, except per share data):~~

This pro forma financial information is based on historical results of operations, adjusted for the allocation of the purchase price and other acquisition accounting adjustments, and is not indicative of what our results would have been had we operated Bonten or Tennis for the periods presented because the pro forma results do not reflect expected synergies. The pro forma adjustments reflect depreciation expense and amortization of intangible assets related to the fair value adjustments of the assetsSTG 5.125% Notes acquired and any adjustments to interest expense to reflect the debt financing of the transactions, if applicable. Depreciation and amortization expense are higher than amounts recorded in the historical financial statements of the acquirees due to the fair value adjustments recorded for long-lived tangible and intangible assets in purchase accounting.

~~Pending Acquisitions.~~ In May 2017, we entered into a definitive agreement to acquire the stock of Tribune Media Company (Tribune) for $43.50 per share, for an aggregate purchase price of approximately $3.9 billion, plus the assumption or refinancing of approximately $2.7 billion in net debt. Under the terms of the agreement, Tribune stockholders will receive $35.00 in cash and 0.23 shares of Sinclair Class A common stock for each share of Tribune Class A common stock and Class B common stock they own. Tribune owns or operates 42 television stations in 33 markets, cable network WGN America, digital multicast network Antenna TV, minority stakes in the TV Food Network, ThisTV, and CareerBuilder, and a variety of real estate assets. Tribune’s stations consists of 14 FOX, 12 CW, 6 CBS, 3 ABC, 2 NBC, 3 MyNetworkTV affiliates and 2 independent stations. We expect the transaction will close during the first quarter of 2018, as well as customary closing conditions, including antitrust clearance and approval by the FCC. We expect to fund the purchase price through a combination of cash on hand, fully committed debt financing, and by accessing the capital markets. In October 2017, Tribune shareholders held a meeting and voted to approve the merger agreement. See ~~Note 3. Notes Payable and Commercial Bank Financing~~ ~~for further discussion on debt financing.~~

~~2017 Dispositions~~

~~Alarm Funding Sale.~~ ~~In March 2017, we sold Alarm Funding Associates LLC (Alarm) for $200.0 million less working capital and transaction costs of $5.0 million.~~nine months ended September 30, 2022 were canceled immediately following their acquisition. We recognized a gain on extinguishment of the ~~sale~~STG 5.125% Notes of ~~Alarm~~$13 million for the nine months ended September 30, 2022.

The debt of ~~$53.0~~DSIH was deconsolidated from our balance sheet as part of the Deconsolidation. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

Finance leases to affiliates

The current portion of notes payable, finance leases, and commercial bank financing in our consolidated balance sheets includes finance leases to affiliates of $2 million and $3 million as of September 30, 2022 and December 31, 2021, respectively. Notes payable, finance leases, and commercial bank financing, less current portion, in our consolidated balance sheets includes finances leases to affiliates of $5 million and $6 million as of September 30, 2022 and December 31, 2021, respectively. See Note 10. Related Person Transactions.

Debt of variable interest entities and guarantees of third-party obligations

STG jointly, severally, unconditionally, and irrevocably guaranteed $35 million and $39 million of debt of certain third parties as of September 30, 2022 and December 31, 2021, respectively, of which ~~$12.3~~$8 million ~~was attributable~~and $9 million, net of deferred financing costs, related to ~~noncontrolling interests which~~consolidated VIEs is included in our consolidated balance sheets as of September 30, 2022 and December 31, 2021, respectively. These guarantees primarily relate to the ~~gain on asset dispositions~~debt of Cunningham Broadcasting Corporation (Cunningham) as discussed under Cunningham Broadcasting Corporation within Note 10. Related Person Transactions. The credit agreements and term loans of these VIEs each bear interest of LIBOR plus 2.50%. We provide a guarantee of certain obligations of a regional sports network subject to a maximum annual amount of $108 million with annual escalations of 4% for the next eight years. We have determined that, as of September 30, 2022, it is not probable that we would have to perform under any of these guarantees.

5.REDEEMABLE NONCONTROLLING INTERESTS:

We account for redeemable noncontrolling interests in accordance with ASC 480, Distinguishing Liabilities from Equity, and classify them as mezzanine equity in our consolidated balance sheets because their possible redemption is outside of the control of the Company. Our redeemable non-controlling interests consist of the following:

Redeemable Subsidiary Preferred Equity. On August 23, 2019, Diamond Sports Holdings LLC ("DSH"), an indirect parent of DSG and indirect wholly-owned subsidiary of the Company, issued preferred equity (the "Redeemable Subsidiary Preferred Equity").

Dividends that accrued to the Redeemable Subsidiary Preferred Equity for the three and nine months ended September 30, 2022 were $3 million and $9 million, respectively, and for the three and nine months ended September 30, 2021 were $4 million and $11 million, respectively, and are reflected in net income attributable to the ~~noncontrolling interest, respectively, on~~redeemable controlling interests in our consolidated statements of operations. The dividends paid in cash accrue at a rate equal to 1-month LIBOR (with a 0.75% floor) plus 8.0%, which is 0.5% lower than the ~~consolidated statement of operations.~~rate payable if the dividends were paid-in-kind during the quarter. Dividends accrued during the three and nine months ended September 30, 2022 and both the three months ended September 30, 2021 and June 30, 2021 were paid-in-kind and added to the liquidation preference, which was partially offset by certain required cash tax distributions.

3.~~NOTES PAYABLE AND COMMERCIAL BANK FINANCING:~~

~~Bank Credit Agreement~~

~~On January 3, 2017, we amended our bank credit agreement. We extended the maturity date~~The balance of the ~~Term Loan B from April 9, 2020~~Redeemable Subsidiary Preferred Equity, net of issuance costs, was $190 million and July 31, 2021 to January 3, 2024. In connection with the extension, we added additional operating flexibility, including a reduction in certain pricing terms related to Term Loan B and our existing revolving credit facility (Revolver) and revisions to certain covenant ratio requirements. The Term Loan B and Revolver bear interest at LIBOR plus 2.25% and 2.00%, respectively. We incurred approximately $11.6$181 million of financing costs in connection with the amendment, of which $3.4 million related to an original issuance discount, $7.7 million was expensed, and $0.5 million was capitalized as a deferred financing cost as of September 30, ~~2017. Additionally, unamortized deferred financing costs~~2022 and December 31, 2021, respectively. The liquidation preference of ~~$1.4~~the Redeemable Subsidiary Preferred Equity was $194 million ~~were written off~~and $185 million as ~~loss on extinguishment in the consolidated statement of operations in the first quarter of 2017 related to this amendment. As~~ of September 30, ~~2017~~2022 and December 31, ~~2016,~~2021, respectively.

Subsidiary Equity Put Right. A noncontrolling equity holder of DSIH has the ~~Term Loan B balance net~~right to sell their interest to DSIH at any time during the 30-day period following September 30, 2025. The value of ~~deferred financing costs~~this redeemable noncontrolling interest was $16 million as of December 31, 2021. This redeemable noncontrolling interest was deconsolidated as part of the Deconsolidation. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and ~~debt discounts was $1,346.7~~Summary of Significant Accounting Policies.

6.COMMITMENTS AND CONTINGENCIES:

Prior to the Deconsolidation, other liabilities included certain fixed payment obligations which were payable through 2027. As of December 31, 2021, $32 million and ~~$1,353.5~~$71 million were recorded within other current liabilities and other long-term liabilities, respectively, in our consolidated balance sheets. We recorded interest expense of $1 million for the nine months ended September 30, 2022 and $2 million and $5 million for the three and nine months ended September 30, 2021, respectively. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

Prior to the Deconsolidation, other liabilities included certain variable payment obligations which were payable through 2030. These contractual obligations were based upon the excess cash flow of certain Bally RSNs. As of December 31, 2021, $8 million and $23 million were recorded within other current liabilities and other long-term liabilities, respectively, in our consolidated balance sheets. We recorded measurement adjustment losses of $3 million for the nine months ended September 30, ~~2017~~2022 and ~~December 31, 2016, there was no outstanding balance under our revolving credit facility. As of~~$1 million and $4 million for the three and nine months ended September 30, ~~2017, we had $484.4 million~~2021, respectively, which are reflected in other income (expense), net in our consolidated statements of ~~borrowing capacity under our revolving credit facility.~~operations. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

~~Commitment Letters and Incremental Term B Facility related to Tribune Acquisition~~

~~In connection with the pending acquisition of Tribune discussed in~~ ~~Note 2. Acquisitions and Disposition of Assets,~~ we entered into financing commitment letters (Commitment Letters) with certain financial institutions for (i) a seven-year senior secured incremental term loan B facility of up to $3.747 billion (Incremental Term Loan B Facility) and (ii) a one-year senior unsecured term loan bridge facility of up to $785 million (Bridge Facility) and, together with the Incremental Term B Facility, collectively the (Facilities), convertible into a nine-year extended term loan, for purposes of financing a portion of the cash consideration payable under the terms of the agreement of plan merger between the Company and Tribune (Merger Agreement) and to pay or redeem certain indebtedness of Tribune and its subsidiaries. The Commitment Letters also contemplate certain amendments to our existing credit agreement, as subsequently amended (Existing Credit Agreement) in connection with the Tribune Acquisition to permit the acquisition and to provide for the Incremental Term B Facility in accordance with the terms of the Existing Credit Agreement. The Commitment Letters also provide for the syndication of an incremental revolving credit loan facility commitment of up to $225 million (Incremental Revolving Commitments) to be provided in accordance with the terms of the Existing Credit Agreement. The provision of the Incremental Revolving Commitments is not a condition of the Incremental Term B Facility or the Bridge Facility.

The Incremental Term Loan B Facility will be subject to representations, warranties and covenants that, subject to certain agreed modifications, will be substantially similar to those in the Existing Credit Agreement. The documentation for the Bridge Facility shall, except as otherwise agreed, be based on and consistent with the indenture governing our 5.125% Senior Notes due 2027, dated as of August 30, 2016, among STG and U.S. Bank National Association, as trustee (5.125% Notes Indenture), and shall in any case, except as expressly agreed, be no less favorable to us than the 5.125% Notes Indenture.

~~The funding of the Facilities is subject to our compliance with customary terms and conditions precedent as set forth in~~

the Commitment Letters, including, among others, (i) the execution and delivery by us of definitive documentation consistent with the Commitment Letters and (ii) that the acquisition of Tribune shall have been, or substantially simultaneously with the funding under the Facilities shall be, consummated in accordance with the terms of the Merger Agreement without giving effect to any amendments or waivers that are material and adverse to the parties to the Commitment Letters.

In June 2017, Tribune commenced a consent solicitation, seeking consents from the holders of Tribune notes to amend certain provisions of the indenture governing Tribune's 5.875% Senior Notes due 2022 (Tribune notes), to (i) eliminate any requirement for Tribune to make a "Change of Control Offer," to holders of Tribune notes in connection with the transactions, (ii) clarify the treatment under the Tribune notes of the proposed structure of the transactions and to facilitate the integration of Tribune and its subsidiaries and the Tribune notes with and into the Company's debt capital structure, and (iii) eliminate the expense associated with producing and filing with the SEC separate financial reports for STG, a wholly-owned subsidiary and the television operating subsidiary of the Company, as successor issuer of the Tribune notes, if the Company or any other parent entity of the successor issuer of the Tribune notes, in its sole discretion, provides an unconditional guarantee of the payment obligations of the successor issuer under the Tribune notes. Tribune received the requisite consent from the holders of the Notes and executed a supplemental indenture to amend these provisions of the Tribune indenture. The Company paid a consent fee of $8.25 million to the consenting holders of the Notes.

4.~~COMMITMENTS AND CONTINGENCIES:~~

We are a party to lawsuits, claims, and ~~claims~~regulatory matters from time to time in the ordinary course of business. Actions currently pending are in various stages and no material judgments or decisions have been rendered by hearing boards or courts in connection with such actions. ~~After reviewing developments~~Except as noted below, we do not believe the outcome of these matters, individually or in the aggregate, will have a material effect on our financial statements.

FCC Litigation Matters

On May 22, 2020, the FCC released an Order and Consent Decree pursuant to ~~date with legal counsel, our management is~~which the Company agreed to pay $48 million to resolve the matters covered by a Notice of ~~the opinion that none of our pending and threatened matters are material. The FCC has undertaken an investigation~~Apparent Liability for Forfeiture ("NAL") issued in ~~response to~~December 2017 proposing a ~~complaint it received alleging possible~~$13 million fine for alleged violations of the ~~FCC’s~~FCC's sponsorship identification rules by the Company and certain of its ~~subsidiaries. We cannot predict~~subsidiaries, the ~~outcome~~FCC’s investigation of ~~any potential FCC action related to this matter but it is possible that such action could include fines and/or compliance programs.~~

~~Changes~~the allegations raised in the ~~Rules~~Hearing Designation Order issued in connection with the Company's proposed acquisition of ~~Television Ownership, Local Marketing Agreements, Joint Sales Agreements, Retransmission Consent Negotiations,~~Tribune, and ~~National Ownership Cap~~

~~Certain of our stations have entered into what have commonly been referred to as local marketing agreements or LMAs. One typical type of LMA is~~ a ~~programming agreement between two separately owned television stations serving~~retransmission related matter. The Company submitted the ~~same market, whereby the licensee of one station programs substantial portions~~$48 million payment on August 19, 2020. As part of the ~~broadcast day~~consent decree, the Company also agreed to implement a 4-year compliance plan. Two petitions were filed on June 8, 2020 seeking reconsideration of the Order and ~~sells advertising time during such programming segments on the other licensee’s station subject~~Consent Decree. The Company filed an opposition to the ~~latter licensee’s ultimate editorial~~petitions on June 18, 2020, and ~~other controls. We believe these arrangements allow us to reduce our operating expenses and enhance profitability.~~the petitions remain pending.

In 1999, the FCC established a new local television ownership rule which made LMAs attributable. However, the rule grandfathered LMAs that were entered into prior to November 5, 1996, and permitted the applicable stations to continue operations pursuant to the LMAs until the conclusion

On September 1, 2020, one of the ~~FCC’s 2004 biennial review. The FCC stated it would conduct~~individuals who filed a case-by-case review of grandfathered LMAs and assess the appropriateness of extending the grandfathering periods. The FCC did not initiate any review of grandfathered LMAs in 2004 or as part of its subsequent quadrennial reviews. We do not know when, or if, the FCC will conduct any such review of grandfathered LMAs. Currently, all of our LMAs are grandfathered under the local television ownership rule because they were entered into prior to November 5, 1996. If the FCC were to eliminate the grandfathering of these LMAs, we would have to terminate or modify these LMAs.

In February 2015, the FCC issued an order implementing certain statutorily required changes to its rules governing the duty to negotiate retransmission consent agreements in good faith. With these changes, a television broadcast station is prohibited from negotiating retransmission consent jointly with another television station in the same market unless the “stations are directly or indirectly under common de jure control permitted under the regulationspetition for reconsideration of the ~~Commission.” During a 2015 retransmission consent negotiation, an MVPD~~Order and Consent Decree filed a ~~complaint~~petition to deny the license renewal application of WBFF(TV), Baltimore, MD, and the license renewal applications of two other Baltimore, MD stations with the FCC accusing us of violating this rule. Although we reached agreement with the MVPD, the FCC initiated an investigation. In order to resolve the investigation and all other pending matters before the FCC's Media Bureau (including the grant of all outstanding renewals and dismissal or cancellation of all outstanding adversarial pleadings or forfeitures before the Media Bureau), the Company, on July 29, 2016, without any admission of liability, entered into a consent decree with the FCC pursuant to which the Company ~~paid~~has a ~~settlement payment~~JSA or LMA, Deerfield Media station WUTB(TV) and ~~agreed~~Cunningham station WNUV(TV). The Company filed an opposition to ~~be subject to ongoing compliance monitoring by~~the petition on October 1, 2020, and the petition remains pending.

On September 2, 2020, the FCC ~~for~~adopted a ~~period~~Memorandum Opinion and Order and NAL against the licensees of ~~36 months.~~

~~In September 2015,~~several stations with whom the ~~FCC released a Notice of Proposed Rulemaking~~Company has LMAs, JSAs, and/or SSAs in response to a ~~Congressional directive in STELAR~~complaint regarding those stations’ retransmission consent negotiations. The NAL proposed a $0.5 million penalty for each station, totaling $9 million. The licensees filed a response to ~~examine~~ the ~~“totality of~~NAL on October 15, 2020, asking the ~~circumstances test” for good-faith negotiations of retransmission consent. The~~Commission to dismiss the proceeding or, alternatively, to reduce the proposed ~~rulemaking sought comment on new factors and evidence~~forfeiture to consider in the FCC's evaluation of claims of bad faith negotiation, including service interruptions prior to a “marquee sports or entertainment event,” restrictions on online access to broadcast programming during negotiation impasses, broadcasters’ ability to offer bundles of broadcast signals with other broadcast stations or cable networks, and broadcasters’ ability to invoke the FCC’s exclusivity rules during service interruptions.$25,000 per station. On July ~~14, 2016, then-Chairman Wheeler announced that~~28, 2021, the FCC would not, at such time, proceed to adopt additional rules governing good faith negotiations of retransmission consent. No formal action has yet been taken on this Proposed Rulemaking, and we cannot predict ifissued a forfeiture order in which the ~~full Commission will agree to terminate the Rulemaking without action.~~

In August 2016, the FCC completed both its 2010 and 2014 quadrennial reviews of its media ownership rules and issued an order (the "Ownership Order") which left most of the existing multiple ownership rules intact,$0.5 million penalty was upheld for all but ~~amended the rules to provide for the attribution of JSAs where two television stations are located in the same market, and a party with an attributable ownership interest in~~ one ~~station sells more than 15% of the advertising time per week of the second~~ station. The Ownership Order also provides that JSAs that existed prior to March 31, 2014, will not be counted as attributable and may remain in place until October 1, 2025, at which point they must be terminated, amended or otherwise come into compliance with the rules. These "grandfathered" JSAs may be transferred or assigned without terminating the grandfathering status relief. Among other things, the television JSA attribution rule could limit our future ability to create duopolies or other two-station operations in certain markets. We cannot predict whether we will be able to terminate or restructure such arrangements prior to October 1, 2025, on terms that are as advantageous to us as the current arrangements. The revenues of these JSA arrangements we earned during the three and nine months ended September 30, 2017 were $15.9 million and $45.1 million, and $16.0 million and $42.5 million during the three and nine months ended September 30, 2016, respectively. The Ownership Order is the subject of an appeal to the U.S. Court of Appeals for the Third Circuit and Petitions for Reconsideration before the FCC. On October 26, 2017, the FCC announced plans to grant in part and deny in part the Petitions for Reconsideration and released a draft Order on Reconsideration to be voted on at the Commission’s November 16, 2017 monthly public meeting. The draft Order on Reconsideration includes, among other things, proposals to (1) eliminate the Newspaper/Broadcast and TV/Radio Cross-Ownership Rules; (2) permit certain TV duopolies in all markets by eliminating the Eight Voices Test and assessing proposed Big-4 station combinations on a case-by-case basis; (3) eliminate attribution of Joint Sales Agreements; and (4) create an incubator program to promote new entry and ownership diversity in the broadcast industry. The draft Order on Reconsideration is subject to change prior to adoption. If adopted, the Order on Reconsideration would be effective 30 days after publication in the Federal Register.

~~If we are required to terminate or modify our LMAs or JSAs, our business could be affected in the following ways:~~

~~Losses on investments~~. In some cases, we own the non-license assets used by the stations we operate under LMAs and JSAs. If certain of these arrangements are no longer permitted, we could be forced to sell these assets, restructure our agreements or find another use for them. If this happens, the market for such assets may not be as good as when we purchased them and, therefore, we cannot be certain of a favorable return on our original investments.

~~Termination penalties~~. If the FCC requires us to modify or terminate existing LMAs or JSAs before the terms of the agreements expire, or under certain circumstances, we elect not to extend the terms of the agreements, we may be forced to pay termination penalties under the terms of some of our agreements. Any such termination penalties could be material.

On September 6, 2016, the FCC released an order eliminating the UHF discount (the "UHF Discount Order"). The UHF discount allowed television station owners to recognize the limitation of coverage inherent with UHF stations when calculating compliance with the FCC’s national ownership cap, which prohibits a single entity from owning television stations that reach, in total, more than 39% of all the television households in the nation. All but 34 of the stations we currently own and operate, or to which we provide programming services are UHF. On April 20, 2017, the FCC acted on aA Petition for Reconsideration of the ~~UHF Discount~~forfeiture order was filed on August 7, 2021. On March 14, 2022, the Commission released a Memorandum Opinion and Order and ~~adopted an~~ Order on Reconsideration, ~~which reinstated~~reaffirming the ~~UHF Discount, which was~~forfeiture order and dismissing (and in the alternative, denying) the Petition for Reconsideration. The Company is not a party to ~~become effective June 5, 2017. The Order on Reconsideration also announced~~this forfeiture order; however, our consolidated financial statements include an accrual of additional expenses of $8 million for the above legal matters during the year ended December 31, 2021, as we consolidate these stations as VIEs.

On September 21, 2022, the FCC released an NAL against the licensees of a number of stations, including 83 Company stations and several stations with whom the Company has LMAs, JSAs, and/or SSAs, for violation of the FCC's ~~plans~~limitations on commercial matter in children’s television programming related to ~~open~~KidsClick network programming distributed by the Company in 2018. The NAL proposed a ~~rulemaking proceeding later this year~~fine of $2.7 million against the Company, and fines ranging from $20,000 to ~~consider whether to modify~~$26,000 per station for the ~~national audience reach rule,~~other licensees, including the ~~UHF discount. A petition~~LMA, JSA, and/or SSA stations, for ~~judicial review~~a total of $3.4 million. As of September 30, 2022, we have accrued $3.4 million. On October 21, 2022, the Company filed a written response seeking reduction of the ~~Order on Reconsideration was~~proposed fine amount, and the matter remains pending.

Other Litigation Matters

On November 6, 2018, the Company agreed to enter into a proposed consent decree with the Department of Justice (the "DOJ"). This consent decree resolves the DOJ’s investigation into the sharing of pacing information among certain stations in some local markets. The DOJ filed atthe consent decree and related documents in the U.S. District Court ~~of Appeals~~ for the ~~D.C. Circuit~~District of Columbia on November 13, 2018. The U.S. District Court for the District of Columbia entered the consent decree on May ~~12, 2017. Sinclair has filed~~22, 2019. The consent decree is not an admission of any wrongdoing by the Company and does not subject the Company to ~~intervene in support~~any monetary damages or penalties. The Company believes that even if the pacing information was shared as alleged, it would not have impacted any pricing of advertisements or the competitive nature of the ~~FCC. Prior~~market. The consent decree requires the Company to adopt certain antitrust compliance measures, including the ~~effective date,~~appointment of an Antitrust Compliance Officer, consistent with what the ~~petitioners~~DOJ has required in previous consent decrees in other industries. The consent decree also requires the Company's stations not to exchange pacing and certain other information with other stations in their local markets, which the Company’s management has already instructed them not to do.

The Company is aware of twenty-two putative class action lawsuits that ~~case~~were filed ~~an emergency motion with~~against the ~~court seeking a stay~~Company following published reports of the ~~Order~~DOJ investigation into the exchange of pacing data within the industry. On October 3, 2018, these lawsuits were consolidated in the Northern District of Illinois. The consolidated action alleges that the Company and thirteen other broadcasters conspired to fix prices for commercials to be aired on ~~Reconsideration pending judicial review. The D.C. Circuit Court of Appeals entered an administrative stay~~broadcast television stations throughout the United States and engaged in unlawful information sharing, in violation of the ~~Order on Reconsideration pending its review of the emergency stay motion. On June 15, 2017, the court issued an order dissolving the administrative stay~~Sherman Antitrust Act. The consolidated action seeks damages, attorneys’ fees, costs and ~~denying the emergency stay motion. The Order on Reconsideration became effective immediately upon release of the court's order,~~interest, as ~~a result of which the UHF discount remains in effect. The petitioners filed their brief~~well as injunctions against adopting practices or plans that would restrain competition in the ~~D.C. Circuit~~ways the plaintiffs have alleged. The Court ~~of Appeals~~denied the Defendants’ motion to dismiss on ~~September 25, 2017. The FCC's brief is currently due~~ November ~~7, 2017,~~6, 2020. Since then, the Plaintiffs have served the Defendants with written discovery requests, and the ~~intervenor's brief is currently due November 14, 2017. Petitioners' reply brief is due~~Court has set a pretrial schedule which now requires discovery to be completed by December ~~5, 2017. We cannot predict~~30, 2022 and briefing on class certification to be completed by May 15, 2023. The Company believes the ~~outcome~~lawsuits are without merit and intends to vigorously defend itself against all such claims.

5.7.EARNINGS PER SHARE:

The following table reconciles income (numerator) and shares (denominator) used in our computations of basic and diluted earnings per share for the periods presented (in millions, except share amounts which are reflected in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Income (Numerator)
Net income (loss)	$	29	$	17	$	2,639	$	(285)
Net income attributable to the redeemable noncontrolling interests	(5)		(4)		(14)		(13)
Net (income) loss attributable to the noncontrolling interests	(3)		6		(28)		(27)

Numerator for basic and diluted earnings (loss) per common share available to common shareholders	$	21	$	19	$	2,597	$	(325)

Shares (Denominator)
Basic weighted-average common shares outstanding	69,907		75,472		70,981		75,068
Dilutive effect of stock-settled appreciation rights and outstanding stock options	—		44		4		—
Diluted weighted-average common and common equivalent shares outstanding	69,907		75,516		70,985		75,068

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Income (Numerator)
Net income $ 32,566
$ 52,033
$ 149,303
$ 128,262

Net income attributable to noncontrolling interests (1,929 ) (1,188 ) (16,820 ) (3,858 )
Numerator for basic and diluted earnings per common share available to common shareholders $ 30,637
$ 50,845
$ 132,483
$ 124,404

Shares (Denominator)

Weighted-average common shares outstanding 102,245
93,948
99,210
94,595

Dilutive effect of stock-settled appreciation rights and outstanding stock options 810
818
963
870

Weighted-average common and common equivalent shares outstanding 103,055
94,766
100,173
95,465

The following table shows the weighted-average stock-settled appreciation rights and outstanding stock options (in thousands) that are excluded from the calculation of diluted earnings per common share as the inclusion of such shares would be anti-dilutive:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
Weighted-average stock-settled appreciation rights and outstanding stock options excluded	3,645	1,670	3,278	1,629

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Weighted-average stock-settled appreciation rights and outstanding stock options excluded 1,150
525
383
525

~~We measure~~During the period ended September 30, 2022, we measured segment performance based on operating income (loss). For the quarter ended September 30, 2022, we had one reportable segment, broadcast. Prior to the Deconsolidation, we had two reportable segments, broadcast andlocal sports. Our broadcast segment ~~includes~~provides free over-the-air programming to television viewing audiences for stations in 89 markets located throughout the continental United ~~States.~~States, as well as distributes the content of these stations to MVPDs for distribution to their customers in exchange for contractual fees. See Revenue Recognition under Note 1. Nature of Operations and Summary of Significant Accounting Policies for further detail. Our local sports segment provided viewers with live professional sports content and included our Bally RSNs, Marquee, and our investment in the YES Network, prior to the Deconsolidation on March 1, 2022. See Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies. Other and corporate are not reportable segments but are included for reconciliation purposes. Other primarily consists of original networks and content, including Tennis, non-broadcast digital and internet solutions, technical services, and other non-media investments. ~~All of our businesses are located within the United States.~~ Corporate costs primarily include our costs to operate as a public company and to operate our corporate headquarters ~~location. Other~~ and ~~Corporate~~shared services locations. All of our businesses are ~~not reportable segments but are included for reconciliation purposes.~~ located within the United States.

~~We had approximately $172.7 million and $226.5 million~~

Table of intercompany loans between the broadcast segment, other, and corporate as of September 30, 2017 and 2016, respectively. We had $4.3 million and $6.1 million in intercompany interest expense related to intercompany loans between the broadcast segment, other, and corporate for the three months ended September 30, 2017 and 2016, respectively. We had $14.2 million and $18.3 million in intercompany interest expense for the the nine months ended September 30, 2017 and 2016, respectively. All other intercompany transactions are immaterial.Contents

Segment financial information is included in the following tables for the periods presented (in ~~thousands)~~millions):


As of September 30, 2022	Broadcast		Local sports		Other & Corporate			Eliminations		Consolidated
Assets	$	4,609	$	—	$	1,999	(e)	$	(3)	$	6,605


For the three months ended September 30, 2022	Broadcast			Local sports		Other & Corporate		Eliminations			Consolidated
Revenue	$	753	(b)	$	—	$	103	$	(13)	(a)	$	843
Depreciation of property and equipment and amortization of definite-lived intangibles and other assets	60			—		7		—			67

Amortization of program contract costs	17			—		5		—			22
Corporate general and administrative expenses	17			—		13		—			30

Gain on asset dispositions and other, net of impairment	(7)			—		(21)		—			(28)

Operating income	152			—		5		(3)			154
Interest expense including amortization of debt discount and deferred financing costs	—			—		61		(2)			59
Income from equity method investments	—			—		33		—			33


For the three months ended September 30, 2021	Broadcast		Local sports		Other & Corporate		Eliminations			Consolidated
Revenue	$	701	$	759	$	117	$	(42)	(a)	$	1,535
Depreciation of property and equipment and amortization of definite-lived intangibles and other assets	61		79		9		(1)			148
Amortization of sports programming rights	—		531		—		—			531
Amortization of program contract costs	18		—		4		—			22
Corporate general and administrative expenses	30		2		3		—			35
(Gain) loss on asset dispositions and other, net of impairment	(6)		—		2		—			(4)

Operating income (loss)	126		(39)		(12)		(2)			73
Interest expense including amortization of debt discount and deferred financing costs	1		109		48		(3)			155
Income from equity method investments	—		12		—		—			12

For the three months ended September 30, 2017 Broadcast Other Corporate Consolidated
Revenue $ 610,840
$ 60,051
$ —
$ 670,891
Depreciation of property and equipment 22,344
1,851
247
24,442
Amortization of definite-lived intangible assets and other assets 38,186
5,182
—
43,368
Amortization of program contract costs and net realizable value adjustments 28,047
—
—
28,047
General and administrative overhead expenses 23,582
224
2,025
25,831
Research and development —
2,551
—
2,551
Operating income (loss) 115,571
(9,852 ) (2,272 ) 103,447
Interest expense 1,281
204
50,258
51,743
Loss from equity and cost method investments —
(4,362 ) —
(4,362 )
Assets 5,274,895
762,751
649,423
6,687,069

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For the three months ended September 30, 2016 Broadcast Other Corporate Consolidated
Revenue $ 635,559
$ 58,276
$ —
$ 693,835
Depreciation of property and equipment 24,195
1,425
266
25,886
Amortization of definite-lived intangible assets and other assets 38,717
9,090
—
47,807
Amortization of program contract costs and net realizable value adjustments 32,441
—
—
32,441
General and administrative overhead expenses 17,530
247
1,275
19,052
Research and development —
745
—
745
Operating income (loss) 158,666
(3,077 ) (1,595 ) 153,994
Interest expense 1,404
1,664
50,420
53,488
Income from equity and cost method investments —
611
812
1,423


For the nine months ended September 30, 2022	Broadcast			Local sports		Other & Corporate			Eliminations			Consolidated
Revenue	$	2,206	(b)	$	482	$	368		$	(88)	(a)	$	2,968
Depreciation of property and equipment and amortization of definite-lived intangibles and other assets	180			54		23			(2)			255
Amortization of sports programming rights	—			326		—			—			326
Amortization of program contract costs	55			—		13			—			68
Corporate general and administrative expenses	93			1		21			—			115
Gain on deconsolidation of subsidiary	—			—		(3,357)		(c)	—			(3,357)
Gain on asset dispositions and other, net of impairment	(12)			—		(25)			—			(37)

Operating income (loss)	367			(4)		3,364			—			3,727
Interest expense including amortization of debt discount and deferred financing costs	2			72		164			(10)			228
Income from equity method investments	—			10		38			—			48


For the nine months ended September 30, 2021	Broadcast		Local sports (d)		Other & Corporate		Eliminations			Consolidated
Revenue	$	2,053	$	2,365	$	345	$	(105)	(a)	$	4,658
Depreciation of property and equipment and amortization of definite-lived intangibles and other assets	187		241		23		(3)			448
Amortization of sports programming rights	—		1,912		—		—			1,912
Amortization of program contract costs	56		—		11		—			67
Corporate general and administrative expenses	114		8		10		—			132
Gain on asset dispositions and other, net of impairment	(23)		—		(3)		—			(26)

Operating income (loss)	294		(368)		5		(1)			(70)
Interest expense including amortization of debt discount and deferred financing costs	3		327		144		(8)			466
Income (loss) from equity method investments	—		35		(12)		—			23

Nine months ended September 30, 2017 Broadcast Other Corporate Consolidated
Revenue $ 1,821,248
$ 178,867
$ —
$ 2,000,115
Depreciation of property and equipment 65,850
5,438
738
72,026
Amortization of definite-lived intangible assets and other assets 114,810
17,489
—
132,299
Amortization of program contract costs and net realizable value adjustments 87,962
—
—
87,962
General and administrative overhead expenses 65,059
785
5,614
71,458
Research and development —
5,053
—
5,053
Operating income (loss) 361,259
25,016
(a) (6,351 ) 379,924
Interest expense 3,976
1,633
154,411
160,020
Loss from equity and cost method investments —
(4,221 ) —
(4,221 )

(a) - Includes $1 million and $26 million for the three and nine months ended September 30, 2022, respectively, and $28 million and $82 million for the three and nine months ended September 30, 2021, respectively, of revenue for services provided by broadcast to local sports and other; and $8 million and $51 million for the three and nine months ended September 30, 2022, respectively, of revenue for services provided by other to broadcast, which are eliminated in consolidation.

(b)Includes $12 million and $27 million for the three and nine months ended September 30, 2022, respectively, of revenue for services provided by broadcast under management services agreements after the Deconsolidation, which is not eliminated in consolidation. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

(c)Represents the gain recognized on the ~~sale~~Deconsolidation. See Deconsolidation of ~~Alarm~~Diamond Sports Intermediate Holdings LLC within Note 1. Nature of ~~$53.0~~Operations and Summary of Significant Accounting Policies.

(d)Represents the activity prior to the Deconsolidation on March 1, 2022. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

(e)Includes the note receivable due to the Company outstanding under the A/R facility of approximately $193 million. See Long Term Note Receivable within Note. 3 Other Assets.

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9.VARIABLE INTEREST ENTITIES:

Certain of our stations provide services to other station owners within the same respective market through agreements, such as LMAs, where we provide programming, sales, operational, and administrative services, and JSAs and SSAs, where we provide non-programming, sales, operational, and administrative services. In certain cases, we have also entered into purchase agreements or options to purchase the license related assets of the licensee. We typically own the majority of the non-license assets of the stations, and in some cases where the licensee acquired the license assets concurrent with our acquisition of the non-license assets of the station, we have provided guarantees to the bank for the licensee’s acquisition financing. The terms of the agreements vary, but generally have initial terms of over five years with several optional renewal terms. Based on the terms of the agreements and the significance of our investment in the stations, we are the primary beneficiary when, subject to the ultimate control of the licensees, we have the power to direct the activities which significantly impact the economic performance of the VIE through the services we provide and we absorb losses and returns that would be considered significant to the VIEs. The fees paid between us and the licensees pursuant to these arrangements are eliminated in consolidation.

A subsidiary of DSIH is a party to a joint venture associated with Marquee. Marquee is party to a long term telecast rights agreement which provides the rights to air certain live game telecasts and other content, which we guarantee. In connection with a prior acquisition, we became party to a joint venture associated with one other regional sports network. DSIH participated significantly in the economics and had the power to direct the activities which significantly impacted the economic performance of these regional sports networks, including sales and certain operational services. As of December 31, 2021, we consolidated these regional sports networks because they were variable interest entities and we were the primary beneficiary. As of March 1, 2022, as a result of the Deconsolidation, we no longer consolidate these regional sports networks. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

The carrying amounts and classification of the assets and liabilities of the VIEs mentioned above, which have been included in our consolidated balance sheets as of the dates presented, were as follows (in millions):


	As of September 30, 2022		As of December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	43

Accounts receivable, net	45		83
Prepaid sports rights	—		2
Other current assets	4		4
Total current assets	49		132


Property and equipment, net	7		17
Operating lease assets	—		5
Goodwill and indefinite-lived intangible assets	15		15
Definite-lived intangible assets, net	42		47
Other assets	—		1
Total assets	$	113	$	217

LIABILITIES
Current liabilities:

Other current liabilities	$	22	$	62

Long-term liabilities:

Operating lease liabilities, less current portion	—		4
Program contracts payable, less current portion	1		2
Other long-term liabilities	3		4
Total liabilities	$	26	$	72

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The amounts above represent the combined assets and liabilities of the VIEs described above, for which we are the primary beneficiary. Total liabilities associated with certain outsourcing agreements and purchase options with certain VIEs, which are excluded from the above, were $129 million and $127 million as of September 30, 2022 and December 31, 2021, respectively, as these amounts are eliminated in consolidation. The assets of each of these consolidated VIEs can only be used to settle the obligations of the VIE. As of September 30, 2022, all of the liabilities are non-recourse to us except for the debt of certain VIEs. See Debt of variable interest entities and guarantees of third-party obligations under Note 4. Notes Payable, Finance Leases, and Commercial Bank Financing for further discussion. The risk and reward characteristics of the VIEs are similar.

Other VIEs

We have several investments in entities which ~~$12.3~~are considered VIEs. However, we do not participate in the management of these entities, including the day-to-day operating decisions or other decisions which would allow us to control the entity, and therefore, we are not considered the primary beneficiary of these VIEs.

In conjunction with the Transaction, the composition of the DSIH board of managers was modified resulting in our loss of voting control over DSIH. We hold substantially all of the equity of DSIH and provide certain management and general and administrative services to DSIH. However, it was determined that we are not the primary beneficiary because we lack the ability to control the activities that most significantly drive the economics of the business. The carrying amount of our investment in DSIH is zero and there is no obligation for us to provide additional financial support. We are also party to an A/R facility held by DSIH which had an outstanding balance of approximately $193 million ~~was attributable~~as of September 30, 2022. See Note Receivable within Note 3. Other Assets. The amounts drawn under the A/R facility represent our maximum loss exposure.

The carrying amounts of our investments in these VIEs for which we are not the primary beneficiary were $186 million and $175 million as of September 30, 2022 and December 31, 2021, respectively, and are included in other assets in our consolidated balance sheets. See Note 3. Other Assets for more information related to ~~noncontrolling interests. See~~ ~~Note 2. Acquisitions~~our equity investments. Our maximum exposure is equal to the carrying value of our investments. The income and ~~Disposition~~loss related to equity method investments and other investments are recorded in income from equity method investments and other income (expense), net, respectively, in our consolidated statements of ~~Assets~~.operations. We recorded gains of $33 million and $58 million for the three and nine months ended September 30, 2022, respectively, and gains of $32 million and $20 million for the three and nine months ended September 30, 2021, respectively, related to these investments.

Nine months ended September 30, 2016 Broadcast Other Corporate Consolidated
Revenue $ 1,790,561
$ 148,697
$ —
$ 1,939,258
Depreciation of property and equipment 69,469
4,063
798
74,330
Amortization of definite-lived intangible assets and other assets 117,038
20,159
—
137,197
Amortization of program contract costs and net realizable value adjustments 96,722
—
—
96,722
General and administrative overhead expenses 50,320
1,075
3,277
54,672
Research and development —
3,055
—
3,055
Operating income (loss) 402,236
(28,699 ) (4,130 ) 369,407
Interest expense 4,297
4,695
147,827
156,819
Income from equity and cost method investments —
414
2,375
2,789

7.10.RELATED PERSON TRANSACTIONS:

Transactions with our controlling shareholders

David, Frederick, J. Duncan, and Robert Smith (collectively, the ~~controlling shareholders)~~"controlling shareholders") are brothers and hold substantially all of ~~the~~our Class B Common Stock and some of our Class A Common Stock. We engaged in the following transactions with them and/or entities in which they have substantial ~~interests.~~interests:

Leases. Certain assets used by us and our operating subsidiaries are leased from ~~Cunningham Communications Inc., Keyser Investment Group, Gerstell Development Limited Partnership and Beaver Dam, LLC (entities~~entities owned by the controlling ~~shareholders).~~shareholders. Lease payments made to these entities were ~~$1.3~~$2 million and $5 million for ~~both~~ the three ~~months ended September 30, 2017~~ and ~~2016, and $3.9 million and $3.8 million for the~~ nine months ended September 30, ~~2017~~2022, respectively, and ~~2016,~~$1 million and $4 million for the three and nine months ended September 30, 2021, respectively. For further information, see Note 4. Notes Payable, Finance Leases, and Commercial Bank Financing.

Charter Aircraft. We lease aircraft owned by certain controlling shareholders. For all leases, we incurred expenses of ~~$0.4~~less than $0.1 million and $0.3 million for the three ~~months ended September 30, 2017~~ and ~~2016, and $1.3 million and $1.0 million for the for the~~ nine months ended September 30, ~~2017~~2022, respectively. We incurred expenses of $0.2 million and ~~2016,~~$0.4 million for the three and nine months ended September 30, 2021, respectively.

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Cunningham Broadcasting Corporation

Cunningham owns a portfolio of television stations, including: WNUV-TV Baltimore, Maryland; WRGT-TV Dayton, Ohio; WVAH-TV Charleston, West Virginia; WMYA-TV Anderson, South Carolina; WTTE-TV Columbus, Ohio; WDBB-TV Birmingham, Alabama; WBSF-TV Flint, Michigan; WGTU-TV/WGTQ-TV Traverse City/Cadillac, ~~Michigan, and beginning in September 2017,~~Michigan; WEMT-TV Tri-Cities, ~~Tennessee,~~Tennessee; WYDO-TV Greenville, North ~~Carolina, KBVU-TV Eureka, California,~~ Carolina; KBVU-TV/KCVU-TV Eureka/Chico-Redding, ~~California, and~~California; WPFO-TV Portland, ~~Maine~~Maine; and KRNV-DT/KENV-DT Reno, Nevada/Salt Lake City, Utah (collectively, the ~~Cunningham Stations)~~"Cunningham Stations"). Certain of our stations provide services to ~~these~~the Cunningham Stations pursuant to LMAs or JSAs and SSAs. See Note ~~1. Nature of Operations and Summary of Significant Accounting Policies~~9. Variable Interest Entities, for further discussion of the scope of services provided under these types of arrangements. As of September 30, 2022, we have jointly and severally, unconditionally, and irrevocably guaranteed $33 million of Cunningham's debt, of which $6 million, net of less than $0.1 million deferred financing costs, relates to the Cunningham VIEs that we consolidate.

~~The estate of Carolyn C. Smith, the mother of our controlling shareholders, currently owns all~~All of the ~~voting~~non-voting stock of the Cunningham ~~Stations. The sale of the voting stock by the estate to an unrelated party is pending approval of the FCC. All of the non-voting stock~~Stations is owned by trusts for the benefit of the children of our controlling shareholders. We consolidate certain subsidiaries of Cunningham with which we have variable interests through various arrangements related to the Cunningham ~~Stations discussed further below.~~Stations.

The services provided to WNUV-TV, WMYA-TV, WTTE-TV, WRGT-TV and WVAH-TV are governed by a master agreement which has a current term that expires on July 1, ~~2023~~2028 and there ~~are two~~is one additional ~~5- year~~five-year renewal ~~terms~~term remaining with final expiration on July 1, 2033. We also executed purchase agreements to acquire the license related assets of these stations from Cunningham, which grant us the right to acquire, and grant Cunningham the right to require us to acquire, subject to applicable FCC rules and regulations, 100% of the capital stock or the assets of these individual subsidiaries of Cunningham. Pursuant to the terms of this agreement we are obligated to pay Cunningham an annual fee for the television stations equal to the greater of (i) 3% of each station’s annual net broadcast revenue ~~and~~or (ii) ~~$4.7~~$5 million. The aggregate purchase price of these television stations increases by 6% annually. A portion of the fee is required to be applied to the purchase price to the extent of the 6% increase. The cumulative prepayments made under these purchase agreements were $60 million and $58 million as of September 30, 2022 and December 31, 2021, respectively. The remaining aggregate purchase price of these stations, net of prepayments, as of both September 30, ~~2017~~2022 and December 31, 2021, was approximately ~~$53.6~~$54 million. Additionally, we provide services to WDBB-TV pursuant to an LMA, which expires April 22, 2025, and ~~own~~have a purchase option to acquire for $0.2 million. We paid Cunningham, under these agreements, ~~$2.4~~$3 million and ~~$2.1~~$7 million for the three ~~months ended September 30, 2017~~ and ~~2016, and $6.4 million and $6.6 million for the~~ nine months ended September 30, ~~2017~~2022, respectively, and ~~2016,~~$3 million and $8 million for the three and nine months ended September 30, 2021, respectively.

~~In September 2017, Cunningham acquired the membership interest of Esteem Broadcasting in connection with our acquisition of Bonten Media Group, as discussed in~~ ~~Note 2. Acquisitions and Disposition of Assets. As a result of the transaction, Cunningham assumed the joint sales agreement under which we will provide services to four stations; WEMT-TV, WYDO-TV, and KBVU-TV/KCVU-TV.~~

The agreements with KBVU-TV/KCVU-TV, KRNV-DT/KENV-DT, WBSF-TV, WEMT-TV, WGTU-TV/WGTQ-TV, WPFO-TV, and WYDO-TV expire ~~in December 2020, November 2021,~~between May 2023 ~~August 2023, December 2023,~~ and ~~August 2025 respectively,~~November 2029 and ~~each has~~certain stations have renewal provisions for successive ~~eight year~~eight-year periods. We earned $6.6 million and $1.4 million from the services we performed for these stations for both the three months ended September 30, 2017 and 2016, and $10.9 million and $3.9 million for the nine months ended September 30, 2017 and 2016, respectively.

As we consolidate the licensees as VIEs, the amounts we earn or pay under the arrangements are eliminated in consolidation and the gross revenues of the stations are reported ~~within~~in our consolidated ~~statement~~statements of operations. Our consolidated revenues ~~related to the Cunningham Stations~~ include ~~$31.4~~$40 million and ~~$29.4~~$111 million for the three and nine months ended September 30, ~~2017~~2022, respectively, and ~~2016, and $84.5~~$35 million and ~~$83.8~~$107 million for the three and nine months ended September 30, ~~2017 and 2016, respectively.~~2021, respectively, related to the Cunningham Stations.

During January 2016, Cunningham entered into a promissory note to borrow $19.5 million from us. The note bears interest at a fixed rate of 5.0% per annum (the 5.0% Notes), which is payable quarterly, commencing March 31, 2016. The note matures in January 2021, with additional one year renewal periods upon our approval. Interest income was $0.2 million for both the three months ended September 30, 2017 and 2016 and $0.7 million for both the for the nine months ended September 30, 2017 and 2016, respectively.

~~In April 2016, we entered into~~We have an agreement with Cunningham to provide master control equipment and provide master control services to a station in Johnstown, PA with which ~~they have a time brokerage agreement~~Cunningham has an LMA that expires in ~~April 2019.~~June 2025. Under the agreement, Cunningham ~~will pay~~paid us an initial fee of ~~$0.7~~$1 million and ~~$0.2~~pays us $0.3 million annually for master control services plus the cost to maintain and repair the equipment. ~~Also, in August 2016,~~In addition, we ~~entered into~~have an agreement ~~expiring October 2021,~~ with Cunningham to provide a news share service with ~~their station in~~the Johnstown, PA ~~beginning in October 2016~~station for an annual fee of ~~$1.0~~$0.6 million, ~~per year.~~which increases by 3% on each anniversary and expires in November 2024.

Atlantic Automotive Corporation

We sell advertising time to Atlantic Automotive Corporation ~~(Atlantic Automotive)~~("Atlantic Automotive"), a holding company that owns automobile dealerships and an automobile leasing company. David D. Smith, our Executive Chairman, has a controlling interest in, and is a member of the Board of Directors of, Atlantic Automotive. We received payments for advertising totaling less than $0.1 million ~~and $0.3 million~~ for all of the three ~~months ended September 30, 2017~~ and ~~2016, and $0.4 million and $0.6 million, for the~~ nine months ended September 30, ~~2017~~2022 and ~~2016, respectively. Additionally, Atlantic Automotive leases office space owned by one~~2021.

Table of ~~our consolidated real estate ventures in Towson, Maryland. In May 2017, our consolidated real estate ventures sold their investment. See~~ ~~Leased property by real estate ventures~~ ~~below for discussion on the sale our consolidated real estate ventures' investment.~~Contents

~~Atlantic Automotive paid $0.4 million and $0.8 million in rent for the nine months ended September 30, 2017 and 2016, respectively.~~

Leased property by real estate ventures

Certain of our real estate ventures have entered into leases with entities owned by ~~David D.~~members of the Smith ~~to lease space. There are leases for space in a building owned by one of our consolidated real estate ventures in Baltimore, MD.~~Family. Total rent payments received under these leases ~~was $0.1~~were $0.3 million and $0.8 million for the three and nine months ended September 30, 2022, respectively, and $0.3 million and $0.7 million for the three and nine months ended September 30, 2021, respectively.

Diamond Sports Intermediate Holdings LLC

Subsequent to February 28, 2022, we accounted for our equity interest in DSIH as an equity method investment. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

Management Services Agreement. In 2019, we entered into a management services agreement with DSG, a wholly-owned subsidiary of DSIH, in which we provide DSG with affiliate sales and marketing services and general and administrative services. The contractual annual amount due from DSG for these services during the fiscal year ended December 31, 2022 is $75 million, which is subject to increases on an annual basis. Additionally, the agreement contains an incentive fee payable to us calculated based on certain terms contained within new or renewed distribution agreements with Distributors. As a condition to the Transaction, DSG will defer the cash payment of a portion of its management fee payable to the Company over the next five years. Pursuant to this agreement, the Broadcast segment recorded $11 million and $49 million of revenue for the three and nine months ended September 30, 2022, respectively, of which $24 million for the nine months ended September 30, 2022 was eliminated in consolidation prior to the Deconsolidation. We will not recognize the portion of deferred management fees as revenue until such fees are determined to be collectible.

Distributions. DSIH made distributions to DSH for tax payments on the dividends of the Redeemable Subsidiary Preferred Equity of $2 million and $5 million during the three and nine months ended September 30, 2022, respectively.

Note receivable. We received payments totaling $60 million from DSPV during the nine months ended September 30, 2022 and funded an additional $40 million during the nine months ended September 30, 2022 related to the note receivable associated with the A/R facility.

During the three and nine months ended September 30, 2022 we recorded revenue of $5 million and $10 million, respectively, within other related to certain other transactions between DSIH and the Company.

Other equity method investees

YES Network. In August 2019, YES Network, which was accounted for as an equity method investment prior to the Deconsolidation, entered into a management services agreement with the Company, in which we provide certain services for an initial term that expires on August 29, 2025. The agreement will automatically renew for two 2-year renewal terms, with a final expiration on August 29, 2029. Pursuant to the terms of the agreement, the YES Network paid us a management services fee of $1 million for the nine months ended September 30, 2022 and $1 million and $4 million for the three and nine months ended September 30, 2021, respectively. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

DSIH has a minority interest in certain mobile production businesses. Prior to the Deconsolidation, we accounted for these as equity method investments. DSIH made payments to these businesses for production services totaling $5 million for the nine months ended September 30, 2022 and $13 million and $37 million for the three and nine months ended September 30, 2021, respectively. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

We have a minority interest in a sports marketing company, which we account for as an equity method investment. We made payments to this business for marketing services totaling $2 million for the nine months ended September 30, 2022 and $5 million and $15 million for the three and nine months ended September 30, 2021, respectively.

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Sports Programming Rights

Affiliates of six professional teams have non-controlling equity interests in certain of DSIH's RSNs. DSIH paid $61 million, net of rebates, for the nine months ended September 30, 2022 and $118 million and $377 million for the three and nine months ended September 30, 2021, respectively, under sports programming rights agreements covering the broadcast of regular season games associated with these professional teams. Prior to the Deconsolidation, these payments were recorded in our consolidated statements of operations and cash flows. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

Employees

Jason Smith, an employee of the Company, is the son of Frederick Smith. Frederick Smith is a Vice President of the Company and a member of the Company's Board of Directors. Jason Smith received total compensation of $0.2 million and $0.1 million for the three months ended September 30, ~~2017~~2022 and ~~2016,~~2021, respectively, and ~~$0.3~~$0.4 million and ~~$0.5~~$0.2 million for the nine months ended September 30, ~~2017~~2022 and ~~2016, respectively.~~

~~One~~2021, respectively, consisting of ~~our real estate ventures, accounted for under the equity method, owned a building in Towson, MD, which leased restaurant space to entities owned by David D. Smith up until May 2017, when the property~~salary and bonus, and was ~~sold to an unrelated party. This investment received less than $0.1 million and $0.2 million in rent pursuant to the lease for the for~~granted 2,239 shares of restricted stock, vesting over two years, during the nine months ended September 30, ~~2017~~2021. Amberly Thompson, an employee of the Company, is the daughter of Donald Thompson. Donald Thompson is an Executive Vice President and ~~2016, respectively.~~

~~Payments for services provided by~~Chief Human Resources Officer of the ~~restaurants to us was~~Company. Amberly Thompson received total compensation of less than $0.1 million for both the three months ended September 30, ~~2017~~2022 and ~~2016,~~2021 and $0.1 million for both the nine months ended September 30, ~~2017~~2022 and ~~2016.~~

~~Other transactions with equity method investees~~

~~In April 2017, we made a $15.0~~2021, consisting of salary and bonus. Edward Kim, an employee of the company, is the brother-in-law of Christopher Ripley. Christopher Ripley is the President and Chief Executive Officer of the Company. Edward Kim received total compensation of less than $0.1 million ~~investment in 120 Sports LLC, a multi-platform sports network branded as Stadium, which we account~~ for ~~under the equity method. We entered into a services agreement with the entity to provide certain linear distribution, engineering advertising, traffic, sales, and promotional services. For~~both the three months ended September 30, ~~2017, we did not receive any consideration pursuant to~~2022 and 2021 and $0.1 million for both the ~~services agreement.~~nine months ended September 30, 2022 and 2021, consisting of salary, and was granted 302 shares of restricted stock, vesting over two years, during the nine months ended September 30, 2022.

8.Frederick Smith, a Vice President of the Company and a member of the Company’s Board of Directors, is the brother of David Smith, Executive Chairman of the Company and Chairman of the Company’s Board of Directors; J. Duncan Smith, a Vice President of the Company and Secretary of the Company’s Board of Directors; and Robert Smith, a member of the Company’s Board of Directors. Frederick Smith received total compensation of $0.2 million for both the three months ended September 30, 2022 and 2021 and $0.6 million for both the nine months ended September 30, 2022 and 2021, consisting of salary and bonus. J. Duncan Smith, a Vice President of the Company and Secretary of the Company’s Board of Directors, is the brother of David Smith, Executive Chairman of the Company and Chairman of the Company’s Board of Directors; Frederick Smith, a Vice President of the Company and a member of the Company’s Board of Directors; and Robert Smith, a member of the Company’s Board of Directors. J. Duncan Smith received total compensation of $0.2 million for both the three months ended September 30, 2022 and 2021 and $0.6 million for both the nine months ended September 30, 2022 and 2021, consisting of salary and bonus.

11.FAIR VALUE MEASUREMENTS:

Accounting guidance provides for valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). A fair value hierarchy using three broad levels prioritizes the inputs to valuation techniques used to measure fair value. The following is a brief description of those three levels:

•Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

•Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.

The ~~fair value of our notes payable, capital leases, and commercial bank financing are considered Level 2 measurements within~~following table sets forth the ~~fair value hierarchy. The carrying~~face value and fair value of our ~~notes~~financial assets and ~~debentures~~liabilities for the periods presented (in ~~thousands)~~millions):

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As of September 30, 2017 As of December 31, 2016
Carrying Value (a) Fair Value Carrying Value (a) Fair Value
6.125% Senior Unsecured Notes due 2022 500,000
516,170
500,000
521,240
5.875% Senior Unsecured Notes due 2026 350,000
359,342
350,000
351,456
5.625% Senior Unsecured Notes due 2024 550,000
565,637
550,000
562,755
5.375% Senior Unsecured Notes due 2021 600,000
615,714
600,000
617,892
5.125% Senior Unsecured Notes due 2027 400,000
389,156
400,000
382,028
Term Loan A 241,073
241,374
272,198
271,517
Term Loan B 1,359,725
1,361,425
1,365,625
1,364,841
Debt of variable interest entities 20,585
20,585
23,198
23,198
Debt of other operating divisions 27,470
27,470
135,211
135,211


	As of September 30, 2022				As of December 31, 2021
	Face Value		Fair Value		Face Value		Fair Value
Level 1:
Investments in equity securities	$	5	$	5	$	5	$	5
Deferred compensation assets	38		38		48		48
Deferred compensation liabilities	32		32		38		38
STG:
Money market funds	467		467		265		265
DSG (a):
Money market funds	—		—		101		101
Level 2:
Investments in equity securities (b)	59		59		114		114
STG (c):
5.875% Senior Notes due 2026 (d)	—		—		348		357
5.500% Senior Notes due 2030	500		359		500		489
5.125% Senior Notes due 2027 (e)	282		233		400		391
4.125% Senior Secured Notes due 2030	750		565		750		712
Term Loan B-1, due January 3, 2024 (d)	—		—		379		373
Term Loan B-2, due September 30, 2026	1,261		1,188		1,271		1,239
Term Loan B-3, due April 1, 2028	731		683		736		722

Term Loan B-4, due April 21, 2029 (d)	748		703		—		—
DSG (a) (c):
12.750% Senior Secured Notes due 2026	—		—		31		17
6.625% Senior Unsecured Notes due 2027	—		—		1,744		490
5.375% Senior Secured Notes due 2026	—		—		3,050		1,525
Term Loan, due August 24, 2026	—		—		3,226		1,484
Debt of variable interest entities (c)	8		8		9		9
Debt of non-media subsidiaries (c)	16		16		17		17
Level 3:
Investments in equity securities (f)	152		152		282		282

(a)The debt of DSG, a wholly-owned subsidiary of DSIH, was deconsolidated from our balance sheet as part of the Deconsolidation. See Deconsolidation of Diamond Sports Intermediate Holdings LLC within Note 1. Nature of Operations and Summary of Significant Accounting Policies.

(b)Consists of unrestricted warrants to acquire marketable common equity securities. The fair value of the warrants are derived from the quoted trading prices of the underlying common equity securities less the exercise price.

(c)Amounts are carried in our consolidated balance sheets net of debt discount, premium, and deferred financing cost, which are excluded in the above table, of ~~$40.7~~$58 million and $158 million as of September 30, ~~2017~~2022 and ~~$43.4~~December 31, 2021, respectively.

(d)In April 2022, STG raised Term B-4 Loans in an aggregate principal amount of $750 million, the proceeds of which were used to refinance all of STG’s outstanding Term Loan B-1 due January 2024 and to redeem STG’s outstanding 5.875% senior notes due 2026. See Note 4. Notes Payable, Finance Leases, and Commercial Bank Financing.

(e)During the nine months ended September 30, 2022, we purchased $118 million aggregate principal amount of the STG 5.125% Notes in open market transactions for consideration of $104 million. The STG 5.125% Notes acquired during the nine months ended September 30, 2022 were canceled immediately following their acquisition. See Note 4. Notes Payable, Finance Leases, and Commercial Bank Financing.

(f)On November 18, 2020, we entered into a commercial agreement with Bally's Corporation ("Bally's") and received warrants and options to acquire common equity in the business. During the three and nine months ended September 30, 2022 we recorded fair value adjustment losses of $0.2 million and $130 million, respectively, and during the three and nine months ended September 30, 2021 we recorded a fair value adjustment loss of $30 million and a gain of $22 million, respectively, related to these interests. The fair value of the warrants is primarily derived from the quoted trading prices of the underlying common equity adjusted for a 12% and 16% discount for lack of marketability ("DLOM") as of September 30, 2022 and December 31, ~~2016.~~2021, respectively. The fair value of the options is derived utilizing the Black Scholes valuation model. The most significant inputs include the trading price of the underlying common stock, the exercise price of the options, which range from $30 to $45 per share, and a DLOM of 12% and 16% as of September 30, 2022 and December 31, 2021, respectively. There are certain restrictions surrounding the sale and ownership of common stock and we have agreed not to sell any shares beneficially owned prior to the first anniversary of the agreement. We are also precluded from owning more than 4.9% of the outstanding common shares of Bally's, inclusive of shares obtained through the exercise of the warrants and options described above.

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The following table summarizes the changes in financial assets measured at fair value on a recurring basis and categorized as Level 3 under the fair value hierarchy for the three and nine months ended September 30, 2022 and 2021 (in millions):


Options and Warrants
Three Months Ended September 30, 2022			Nine Months Ended September 30, 2022
Fair value at June 30, 2022	$	152	Fair value at December 31, 2021	$	282


Measurement adjustments	—		Measurement adjustments	(130)
Fair value at September 30, 2022	$	152	Fair value at September 30, 2022	$	152


Options and Warrants
Three Months Ended September 30, 2021			Nine Months Ended September 30, 2021
Fair value at June 30, 2021	$	384	Fair value at December 31, 2020	$	332


Measurement adjustments	(30)		Measurement adjustments	22
Fair value at September 30, 2021	$	354	Fair value at September 30, 2021	$	354

12.CONDENSED CONSOLIDATING FINANCIAL STATEMENTS:

STG ~~a wholly-owned subsidiary and the television operating subsidiary of Sinclair Broadcast Group, Inc. (SBG),~~ is the primary obligor under the Bank Credit Agreement, ~~the 5.375% Notes, 5.625% Notes, 6.125% Notes, 5.875% Notes,~~ 5.125% Notes, 5.500% Notes, and ~~until they were redeemed,~~4.125% Secured Notes (collectively, the ~~6.375% Notes.~~Notes are referred to as the "STG Notes"). Our Class A Common Stock and Class B Common Stock as of September 30, ~~2017,~~2022, were obligations or securities of SBG and not obligations or securities of STG. SBG is a guarantor under the ~~Bank Credit Agreement, the 5.375% Notes, 5.625% Notes, 6.125% Notes, 5.875% Notes, 6.125% Notes, and 5.125% Notes, and until they were redeemed, the 6.375%~~STG Notes. As of September 30, ~~2017,~~2022, our consolidated total debt, net of deferred financing costs and debt discounts, of ~~$4,055.6~~$4,269 million included ~~$4,027.1~~$4,253 million related to STG and its subsidiaries of which ~~SBG~~we guaranteed ~~$3,980.9~~$4,222 million.

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

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

~~These statements~~SBG, STG, KDSM, LLC and the guarantor subsidiaries, the direct and indirect non-guarantor subsidiaries of SBG are presented in each column under the equity method of accounting. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. As such, these condensed consolidating financial statements should be read in conjunction with the ~~disclosure requirements under SEC Regulation S-X, Rule 3-10.~~accompanying notes to consolidated financial statements.

Table of Contents

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF SEPTEMBER 30, ~~2017~~2022

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
Cash and cash equivalents	$	33	$	483	$	1	$	90	$	—	$	607

Accounts receivable, net	—		—		533		53		—		586
Other current assets	22		43		341		21		(57)		370
Total current assets	55		526		875		164		(57)		1,563

Property and equipment, net	1		32		661		48		(22)		720

Investment in equity of consolidated subsidiaries	851		3,090		—		—		(3,941)		—

Goodwill	—		—		2,081		7		—		2,088
Indefinite-lived intangible assets	—		—		136		14		—		150
Definite-lived intangible assets, net	—		—		977		44		(32)		989
Other long-term assets	546		917		392		1,141		(1,901)		1,095
Total assets	$	1,453	$	4,565	$	5,122	$	1,418	$	(5,953)	$	6,605

Accounts payable and accrued liabilities	$	—	$	92	$	301	$	20	$	(1)	$	412
Current portion of long-term debt	—		28		6		10		(1)		43
Other current liabilities	2		3		197		88		(57)		233
Total current liabilities	2		123		504		118		(59)		688

Long-term debt	—		4,185		25		378		(362)		4,226

Other long-term liabilities	745		55		1,507		318		(1,764)		861
Total liabilities	747		4,363		2,036		814		(2,185)		5,775

Redeemable noncontrolling interests	—		—		—		190		—		190
Total Sinclair Broadcast Group equity	706		202		3,086		483		(3,771)		706
Noncontrolling interests in consolidated subsidiaries	—		—		—		(69)		3		(66)
Total liabilities, redeemable noncontrolling interests, and equity	$	1,453	$	4,565	$	5,122	$	1,418	$	(5,953)	$	6,605

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

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

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

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

142,905
Total current liabilities 686
223,337
523,517
189,257
(25,574 ) 911,223

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

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

Table of Contents

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, ~~2016~~2021

(in ~~thousands)~~millions)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
Cash and cash equivalents	$	2	$	316	$	2	$	496	$	—	$	816
Accounts receivable, net	—		—		649		596		—		1,245
Other current assets	10		82		293		136		(111)		410
Total current assets	12		398		944		1,228		(111)		2,471

Property and equipment, net	1		31		664		161		(24)		833

Investment in equity of consolidated subsidiaries	451		3,448		—		—		(3,899)		—
Restricted cash	—		—		—		3		—		3
Goodwill	—		—		2,081		7		—		2,088
Indefinite-lived intangible assets	—		—		136		14		—		150
Definite-lived intangible assets, net	—		—		1,105		4,019		(36)		5,088
Other long-term assets	331		1,956		427		1,853		(2,659)		1,908
Total assets	$	795	$	5,833	$	5,357	$	7,285	$	(6,729)	$	12,541

Accounts payable and accrued liabilities	$	31	$	85	$	295	$	279	$	(35)	$	655
Current portion of long-term debt	—		20		5		45		(1)		69
Other current liabilities	2		6		155		392		(77)		478
Total current liabilities	33		111		455		716		(113)		1,202

Long-term debt	915		4,317		33		8,488		(1,482)		12,271
Investment in deficit of consolidated subsidiaries	1,605		—		—		—		(1,605)		—
Other long-term liabilities	12		69		1,426		468		(1,398)		577
Total liabilities	2,565		4,497		1,914		9,672		(4,598)		14,050

Redeemable noncontrolling interests	—		—		—		197		—		197
Total Sinclair Broadcast Group (deficit) equity	(1,770)		1,336		3,443		(2,644)		(2,135)		(1,770)
Noncontrolling interests in consolidated subsidiaries	—		—		—		60		4		64
Total liabilities, redeemable noncontrolling interests, and equity	$	795	$	5,833	$	5,357	$	7,285	$	(6,729)	$	12,541

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

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

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

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

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

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

Table of Contents

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, ~~2017~~2022

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
Net revenue	$	—	$	13	$	813	$	47	$	(30)	$	843

Media programming and production expenses	—		2		375		38		(19)		396
Selling, general and administrative expenses	15		23		185		3		(6)		220

Depreciation, amortization and other operating (gains) expenses	(9)		2		78		4		(2)		73
Total operating expenses	6		27		638		45		(27)		689

Operating (loss) income	(6)		(14)		175		2		(3)		154

Equity in earnings of consolidated subsidiaries	17		132		—		—		(149)		—
Interest expense	—		(58)		(1)		(3)		3		(59)
Other income	11		—		—		31		1		43

Total other income (expense)	28		74		(1)		28		(145)		(16)

Income tax (provision) benefit	(1)		14		(41)		(81)		—		(109)
Net income (loss)	21		74		133		(51)		(148)		29
Net income attributable to the redeemable noncontrolling interests	—		—		—		(5)		—		(5)
Net income attributable to the noncontrolling interests	—		—		—		(3)		—		(3)
Net income (loss) attributable to Sinclair Broadcast Group	$	21	$	74	$	133	$	(59)	$	(148)	$	21
Comprehensive income (loss)	$	21	$	74	$	133	$	(51)	$	(148)	$	29

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

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

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

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

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

Table of Contents

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, ~~2016~~2021

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
Net revenue	$	—	$	28	$	758	$	803	$	(54)	$	1,535

Media programming and production expenses	—		1		366		671		(16)		1,022
Selling, general and administrative expenses	3		33		176		87		(36)		263

Depreciation, amortization and other operating expenses	—		2		81		95		(1)		177
Total operating expenses	3		36		623		853		(53)		1,462

Operating (loss) income	(3)		(8)		135		(50)		(1)		73

Equity in earnings of consolidated subsidiaries	21		113		—		—		(134)		—
Interest expense	(3)		(43)		(1)		(113)		5		(155)

Other income (expense)	2		(3)		(2)		14		(3)		8
Total other income (expense)	20		67		(3)		(99)		(132)		(147)

Income tax benefit (provision)	2		9		(16)		96		—		91
Net income (loss)	19		68		116		(53)		(133)		17
Net income attributable to the redeemable noncontrolling interests	—		—		—		(4)		—		(4)
Net loss attributable to the noncontrolling interests	—		—		—		6		—		6
Net income (loss) attributable to Sinclair Broadcast Group	$	19	$	68	$	116	$	(51)	$	(133)	$	19
Comprehensive income (loss)	$	19	$	68	$	116	$	(52)	$	(133)	$	18

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

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

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

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

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

Table of Contents

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, ~~2017~~2022

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
Net revenue	$	—	$	53	$	2,424	$	624	$	(133)	$	2,968

Media programming and production expenses	—		4		1,120		486		(53)		1,557
Selling, general and administrative expenses	21		109		590		72		(72)		720
Gain on deconsolidation of subsidiary	(3,357)		—		—		—		—		(3,357)
Depreciation, amortization and other operating (gains) expenses	(8)		5		246		86		(8)		321
Total operating (gains) expenses	(3,344)		118		1,956		644		(133)		(759)

Operating income (loss)	3,344		(65)		468		(20)		—		3,727

Equity in (loss) earnings of consolidated subsidiaries	(33)		351		—		—		(318)		—
Interest expense	(4)		(155)		(2)		(82)		15		(228)

Other income (expense)	21		(1)		3		(122)		(5)		(104)
Total other (expense) income	(16)		195		1		(204)		(308)		(332)

Income tax (provision) benefit	(731)		44		(115)		46		—		(756)
Net income (loss)	2,597		174		354		(178)		(308)		2,639
Net income attributable to the redeemable noncontrolling interests	—		—		—		(14)		—		(14)
Net income attributable to the noncontrolling interests	—		—		—		(28)		—		(28)
Net income (loss) attributable to Sinclair Broadcast Group	$	2,597	$	174	$	354	$	(220)	$	(308)	$	2,597
Comprehensive income (loss)	$	2,597	$	174	$	354	$	(175)	$	(308)	$	2,642

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

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

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

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

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

Table of Contents

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, ~~2016~~2021

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
Net revenue	$	—	$	83	$	2,207	$	2,507	$	(139)	$	4,658

Media programming and production expenses	—		3		1,073		2,354		(40)		3,390
Selling, general and administrative expenses	10		123		515		252		(93)		807

Depreciation, amortization and other operating expenses	—		6		240		290		(5)		531
Total operating expenses	10		132		1,828		2,896		(138)		4,728

Operating (loss) income	(10)		(49)		379		(389)		(1)		(70)

Equity in (loss) earnings of consolidated subsidiaries	(267)		317		—		—		(50)		—
Interest expense	(10)		(135)		(2)		(337)		18		(466)

Other (expense) income	(61)		11		(24)		166		(10)		82
Total other (expense) income	(338)		193		(26)		(171)		(42)		(384)

Income tax benefit (provision)	23		38		(31)		139		—		169
Net (loss) income	(325)		182		322		(421)		(43)		(285)
Net income attributable to the redeemable noncontrolling interests	—		—		—		(13)		—		(13)
Net income attributable to the noncontrolling interests	—		—		—		(27)		—		(27)
Net (loss) income attributable to Sinclair Broadcast Group	$	(325)	$	182	$	322	$	(461)	$	(43)	$	(325)
Comprehensive (loss) income	$	(325)	$	182	$	322	$	(415)	$	(43)	$	(279)

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

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

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

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

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

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CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, ~~2017~~2022

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
NET CASH FLOWS (USED IN) FROM OPERATING ACTIVITIES	$	(91)	$	(136)	$	757	$	(77)	$	5	$	458

NET CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES
Acquisition of property and equipment	—		(3)		(71)		(3)		3		(74)

Spectrum repack reimbursements	—		—		3		—		—		3
Proceeds from the sale of assets	—		—		5		4		—		9
Deconsolidation of subsidiary cash	—		—		—		(315)		—		(315)
Purchases of investments	(46)		(1)		(3)		(17)		—		(67)
Distributions from investments	60		—		10		20		—		90
Other, net	—		2		—		—		—		2
Net cash flows from (used in) investing activities	14		(2)		(56)		(311)		3		(352)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES
Proceeds from notes payable and commercial bank financing	—		728		—		—		—		728
Repayments of notes payable, commercial bank financing and finance leases	—		(848)		(4)		(2)		—		(854)
Repurchase of outstanding Class A Common Stock	(114)		—		—		—		—		(114)
Dividends paid on Class A and Class B Common Stock	(53)		—		—		—		—		(53)
Dividends paid on redeemable subsidiary preferred equity	—		—		—		(5)		—		(5)


Distributions to noncontrolling interests	—		—		—		(10)		—		(10)

Increase (decrease) in intercompany payables	277		433		(698)		(4)		(8)		—
Other, net	(2)		(8)		—		—		—		(10)
Net cash flows from (used in) financing activities	108		305		(702)		(21)		(8)		(318)

NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	31		167		(1)		(409)		—		(212)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period	2		316		2		499		—		819
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of period	$	33	$	483	$	1	$	90	$	—	$	607

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

CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES:

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

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

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CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, ~~2016~~2021

(in ~~thousands)~~millions) (unaudited)


	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries		Eliminations		Sinclair Consolidated
NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES	$	8	$	(100)	$	317	$	6	$	4	$	235

NET CASH FLOWS USED IN INVESTING ACTIVITIES
Acquisition of property and equipment	—		(1)		(48)		(15)		2		(62)

Spectrum repack reimbursements	—		—		22		—		—		22
Proceeds from the sale of assets	—		—		34		9		—		43
Purchases of investments	(7)		(12)		(40)		(185)		—		(244)
Distributions from investments	—		—		—		11		—		11
Other, net	—		—		(2)		1		—		(1)
Net cash flows used in investing activities	(7)		(13)		(34)		(179)		2		(231)

NET CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES
Proceeds from notes payable and commercial bank financing	—		341		—		16		—		357
Repayments of notes payable, commercial bank financing and finance leases	—		(356)		(5)		(39)		—		(400)

Dividends paid on Class A and Class B Common Stock	(46)		—		—		—		—		(46)
Dividends paid on redeemable subsidiary preferred equity	—		—		—		(4)		—		(4)


Distributions to noncontrolling interests, net	—		—		—		(63)		—		(63)
Distributions to redeemable noncontrolling interests	—		—		—		(5)		—		(5)
Increase (decrease) in intercompany payables	57		226		(268)		(9)		(6)		—
Other, net	(12)		(1)		—		(31)		—		(44)
Net cash flows (used in) from financing activities	(1)		210		(273)		(135)		(6)		(205)

NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	—		97		10		(308)		—		(201)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period	—		458		—		804		—		1,262
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of period	$	—	$	555	$	10	$	496	$	—	$	1,061

13.SUBSEQUENT EVENTS:

In November 2022, our Board of Directors declared a quarterly dividend of $0.25 per share, payable on December 15, 2022 to holders of record at the close of business on December 1, 2022.

Sinclair
Broadcast
Group, Inc. Sinclair
Television
Group, Inc. Guarantor
Subsidiaries
and KDSM,
LLC Non-
Guarantor
Subsidiaries Eliminations Sinclair
Consolidated
NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES $ (4,060 ) $ (152,724 ) $ 451,804
$ 17,138
$ 18,102
$ 330,260
CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:

Acquisition of property and equipment (7 ) (3,626 ) (61,758 ) (3,842 ) 632
(68,601 )
Acquisition of businesses, net of cash acquired —
—
(415,481 ) (10,375 ) —
(425,856 )
Purchase of alarm monitoring contracts —
—
—
(29,143 ) —
(29,143 )
Investments in equity and cost method investees (2,945 ) (10,840 ) (34 ) (20,405 ) —
(34,224 )
Proceeds from sale of non-media business —
—
7,263
9,133
—
16,396
Loans to affiliates —
(19,500 ) —
—
—
(19,500 )
Other, net 1,714
(1,828 ) (86 ) 3,601
—
3,401
Net cash flows from (used in) investing activities (1,238 ) (35,794 ) (470,096 ) (51,031 ) 632
(557,527 )

CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES:

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

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

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This report includes or incorporates forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the ~~Exchange Act)~~"Exchange Act"), and the U.S. Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to risks, uncertainties and assumptions about us, including, among other things, the following risks:

~~General~~COVID-19 risks

•The suspension, and possible cancellation, of tennis tournaments;

•the need to reimburse Distributors affiliation fees related to canceled tennis tournaments;

•loss of advertising revenue due to (i) reluctance of advertisers to purchase advertising spots due to reduced consumer spending as a result of shelter in place and stay at home orders, or lower audience engagement, (ii) potential reduced need for advertisers to advertise for certain goods or services with low supply, due to interruptions in the supply chain, and (iii) adverse business conditions affecting our customers, including our advertisers’ going out of business;

•we may be unable to access debt and equity capital on favorable terms, if at all, or a severe disruption and instability in the global financial markets or deterioration in credit and financing conditions may affect our access to capital necessary to fund business operations, pursue acquisition and development opportunities, refinance existing debt, and increase our future interest expense;

•the interruption to global supply chains caused by COVID-19 could impact our ability to acquire and replace equipment necessary for the continuity of our business;

•the potential effects of COVID-19 on our workforce, suppliers and advertisers including the impact ~~of changes in national~~on our operations because employees either contract COVID-19 or leave the workforce, increased health care cost, increased wages due to wage inflation and ~~regional economies~~an inability to attract and ~~credit and capital markets;~~retain a quality workforce;

•~~consumer confidence;~~

•the potential ~~impact~~effects of ~~changes~~COVID-19 on the economy, including increased inflation, that may cause a reduction in ~~tax law;~~consumer spending; and

•~~the activities~~cybersecurity and operational risks as a result of ~~our competitors;~~work-from-home arrangements.

•~~terrorist acts of violence or war and other geopolitical events;~~

•~~natural disasters that impact our advertisers and our stations; and~~

•~~cybersecurity.~~

Industry risks

~~the~~•The business conditions of our advertisers, particularly in the political, automotive and service ~~industries;~~categories;

~~competition with other broadcast television stations, radio stations, MVPDs, internet and broadband content providers and other print and media outlets serving in the same markets;~~

•the performance of networks and syndicators that provide us with programming content, as well as the performance of internally originated programming;

•subscriber churn due to the impact of technological changes, the proliferation of over-the-top ("OTT") direct to consumer platforms, and economic conditions on consumers desire to pay for subscription services;

•the loss of appeal of our local news, network content, syndicated program content and sports programming, which may be unpredictable;

•the availability and cost of programming from networks and syndicators, as well as the cost of internally originated programming;

•the availability and cost of rights to air professional tennis tournaments;

•our relationships with networks and their strategies to distribute their programming via means other than their local television affiliates, such as ~~over-the-top~~OTT or direct-to-consumer content;

~~the effects of the Federal Communications Commission’s (FCC’s) National Broadband Plan and incentive auction and the repacking of our broadcasting spectrum within a limited timeframe;~~

the potential for additional governmental regulation of broadcasting or changes in those regulations and court actions interpreting those regulations, including ownership regulations limiting over-the-air television’s ability to compete effectively (including regulations relating to Joint Sales Agreements (JSA) and Shared Services Agreements (SSA), and the national ownership cap), arbitrary enforcement of indecency regulations, retransmission consent regulations and political or other advertising restrictions, such as payola rules;

the impact of FCC and Congressional efforts to limit the ability of a television station to negotiate retransmission consent agreements for the same-market stations it does not own and other FCC efforts which may restrict a television station's retransmission consent agreements;

~~the impact of FCC rules requiring broadcast stations to publish, among other information, political advertising rates online;~~

•labor disputes and legislation and other union activity associated with film, acting, writing, and other ~~guilds and professional sports leagues;~~guilds;

•the broadcasting community’s ability to develop and adopt a viable mobile digital broadcast television ~~(mobile DTV)~~("mobile DTV") strategy and platform, such as the adoption of ~~ATSC 3.0~~a next generation broadcast standard ("NEXTGEN TV"), and the consumer’s appetite for mobile television;

•the impact of programming payments charged by networks pursuant to their affiliation agreements with broadcasters requiring compensation for network programming;

•the effects of declining live/appointment viewership as reported through rating systems and local television efforts to adopt and receive credit for same day viewing plus viewing on-demand thereafter;

•changes in television rating measurement methodologies that could negatively impact audience results;

•the ability of local ~~MVPDs~~Distributors to coordinate and determine local advertising rates as a consortium;

~~changes in the makeup of the population in the areas where stations are located;~~

•the operation of low power devices in the broadcast spectrum, which could interfere with our ~~broadcast signals;~~broadcast; and

~~Over-the-top (OTT) technologies and their potential impact on cord-cutting; and~~

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•the impact of ~~MVPDs~~Distributors and OTTs offering ~~“skinny”~~"skinny" programming bundles that may not include television broadcast ~~stations;~~stations or other programming that we distribute.

Regulatory risks

•The effects of the FCC's National Broadband Plan, the impact of the repacking of our broadcasting spectrum, as a result of the incentive auction, within a limited timeframe and funding allocated;

~~fluctuations~~•the potential for additional governmental regulation of broadcasting or changes in those regulations and court actions interpreting those regulations, including ownership regulations limiting over-the-air television's ability to compete effectively (including regulations relating to JSA, SSA, cross ownership rules, the national ownership cap and the UHF discount), arbitrary enforcement of indecency regulations, retransmission consent regulations, and political or other advertising restrictions, such as payola rules;

•the impact of FCC and Congressional efforts which may restrict a television station's retransmission consent negotiations;

•the impact of FCC rules requiring broadcast stations to publish, among other information, political advertising rates online;

•the impact of foreign government rules related to digital and ~~availability~~online assets; and

•the potential impact from the elimination of ~~inventory.~~rules prohibiting mergers of the four major television networks.

Risks specific to us

•The impact of the war in Ukraine including related disruption to supply chains and the increased price of energy, all of which affect our ~~limited ability to obtain FCC approval for any future acquisitions,~~operations as well as ~~in certain cases, customary antitrust clearance and network consents for any future acquisitions;~~

~~the effectiveness~~those of our ~~management;~~advertisers;

•our ability to attract and maintain local, national, and network advertising and successfully participate in new sales channels such as programmatic and addressable advertising through business partnership ventures and the development of technology;

•our ability to service our debt obligations and operate our business under restrictions contained in our financing agreements;

•our ability to successfully implement and monetize our own content management system ~~(CMS)~~ designed to provide our viewers significantly improved content via the internet and other digital platforms;

•our ability to successfully renegotiate retransmission consent ~~agreements;~~and distribution agreements for our existing and acquired businesses with favorable terms;

•the ability of stations which we consolidate, but do not negotiate on their behalf, to successfully renegotiate retransmission consent and affiliation fees (cable network fees) agreements and comply with laws and regulations that apply to them;

•our ability to renew our FCC licenses;

•our ability to obtain FCC approval for any future acquisitions, as well as, in certain cases, customary antitrust clearance for any future acquisitions, as well as any other requests for FCC approval;

•our ability to identify media business investment opportunities and to successfully integrate any acquired businesses, as well as the success of our ~~digital~~new content and distribution initiatives in a competitive environment, ~~such as the investment in the re-launch of Circa;~~including CHARGE!, TBD, Comet, STIRR, other original programming, mobile DTV and FAST channels;

•our ability to maintain our affiliation and programming service agreements with our networks and program service providers and, at renewal, to successfully negotiate these agreements with favorable terms;

•our ability to generate synergies and leverage new revenue opportunities;

•changes in the makeup of the population in the areas where our stations are located;

•our ability to effectively respond to technology affecting our ~~industry and~~industry;

•our ability to ~~increasing competition from other media providers;~~deploy NEXTGEN TV nationwide, as well as monetize the associated technology;

•the strength of ratings for our local news broadcasts including our news sharing arrangements;

the successful execution of our program development and multi-channel broadcasting initiatives including, but not limited to, sports programming, COMET, CHARGE!, TBD and other original programming, and mobile DTV; and

•the results of prior year tax audits by taxing ~~authorities.~~authorities; and

•our ability to monetize our investments in real estate, venture capital and private equity holdings, and direct strategic investments in companies.

General risks

•The impact of changes in national and regional economies and credit and capital markets;

•loss of consumer confidence;

•the potential impact of changes in tax law;

•the activities of our competitors;

•acts of violence or war, such as the war in Ukraine, and other geopolitical events;

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•natural disasters and pandemics that impact our employees, Distributors, advertisers, suppliers, stations and networks; and

•cybersecurity incidents, data privacy, and other information technology failures have, and in the future, may, adversely affect us and disrupt our operations.

Other matters set forth in this report, ~~and other reports filed with the Securities and Exchange Commission,~~ including the Risk Factors set forth in Item 1A of this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021, may also cause actual results in the future to differ materially from those described in the forward-looking statements. However, additional factors and risks not currently known to us or that we currently deem immaterial may also cause actual results in the future to differ materially from those described in the forward-looking statements. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. In light of these risks, uncertainties, and assumptions, events described in the forward-looking statements discussed in this report might not occur.

~~The following table sets forth certain operating data for the periods presented:~~

~~STATEMENTS OF OPERATIONS DATA~~

~~(in thousands, except for per share data) (Unaudited)~~

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Statement of Operations Data:

Media revenues (a) $ 624,169
$ 635,269
$ 1,858,477
$ 1,772,860
Revenues realized from station barter arrangements 31,787
32,061
91,817
92,574
Other non-media revenues 14,935
26,505
49,821
73,824
Total revenues 670,891
693,835
2,000,115
1,939,258

Media production expenses 267,993
242,880
795,140
702,377
Media selling, general and administrative expenses 133,605
126,672
385,372
370,169
Expenses realized from barter arrangements 26,696
27,181
77,491
79,365
Depreciation and amortization expenses (b) 95,857
106,134
292,287
308,249
Other non-media expenses 14,945
20,488
46,921
57,946
Corporate general and administrative expenses 25,831
19,052
71,458
54,672
Research and development expenses 2,551
745
5,053
3,055
Gain on asset dispositions (34 ) (3,311 ) (53,531 ) (5,982 )
Operating income 103,447
153,994
379,924
369,407

Interest expense and amortization of debt discount and deferred financing costs (51,743 ) (53,488 ) (160,020 ) (156,819 )
Loss from extinguishment of debt —
(23,699 ) (1,404 ) (23,699 )
(Loss) income from equity and cost method investees (4,362 ) 1,423
(4,221 ) 2,789
Other income, net 2,342
789
5,601
2,355
Income before income taxes 49,684
79,019
219,880
194,033
Income tax provision (17,118 ) (26,986 ) (70,577 ) (65,771 )
Net income 32,566
52,033
149,303
128,262
Net income attributable to the noncontrolling interests (1,929 ) (1,188 ) (16,820 ) (3,858 )
Net income attributable to Sinclair Broadcast Group $ 30,637
$ 50,845
$ 132,483
$ 124,404

Basic and Diluted Earnings Per Common Share Attributable to Sinclair Broadcast Group:

Basic earnings per share $ 0.30
$ 0.54
$ 1.34
$ 1.32
Diluted earnings per share $ 0.30
$ 0.54
$ 1.32
$ 1.30

Balance Sheet Data: September 30, 2017 December 31, 2016
Cash and cash equivalents $ 602,193
$ 259,984
Total assets $ 6,687,069
$ 5,963,168
Total debt (c) $ 4,055,626
$ 4,203,848
Total equity $ 1,108,299
$ 557,936

~~(a)Media revenues is defined as broadcast revenues, net of agency commissions, retransmission fees, and other media related revenues.~~

~~(b)Depreciation and amortization includes depreciation and amortization of property and equipment, definite-lived intangible assets, program contract costs and other assets.~~

~~(c)Total debt is defined as notes payable, capital leases and commercial bank financing, including the current and long-term portions.~~

The following Management’s Discussion and Analysis provides qualitative and quantitative information about our financial performance and condition and should be read in conjunction with our consolidated financial statements and the accompanying notes to those statements. This discussion consists of the following sections:

~~Executive Overview~~Summary of Significant Events — financial events during the three ~~and nine~~ months ended September 30, ~~2017~~2022 and through the date this Report on Form 10-Q is filed.

Results of Operations — an analysis of our revenues and expenses for the three and nine months ended September 30, ~~2017~~2022 and ~~2016, including comparisons between quarters and expectations for the three months ended December 31, 2017.~~2021.

Liquidity and Capital Resources — a discussion of our primary sources of liquidity and an analysis of our cash flows from or used in operating activities, investing activities, and financing activities ~~and an update of our debt refinancings~~ during the three and nine months ended September 30, ~~2017.~~2022.

Summary of Significant Events ~~and Financial Highlights from Third Quarter 2017 Events~~

~~Acquisitions~~

In September 2017, the Company closed on its purchase of the stock of Bonten Media Group Holdings, Inc. (“Bonten”), and Cunningham Broadcasting Corporation (“Cunningham”) also completed its purchase of the membership interest of Esteem Broadcasting for an aggregate purchase price of $240 million plus a working capital, excluding cash acquired, of $1.3 million. As a result of the transaction, the Company added 14 television stations in 8 markets and Cunningham assumed the joint sales agreements under which the Company will provide services to 4 additional stations. The acquisition was funded through cash on hand.

In October 2017, more than 99% of Tribune stockholders voted to approve the Company’s announced acquisition of 100% of the outstanding shares of Tribune for $43.50 per share, or an aggregate purchase price of $3.9 billion, plus the assumption of $2.7 billion in net debt. The Company expects the transaction will close in early 2018 subject to customary closing conditions, including approval by the Federal Communications Commission (“FCC”) and antitrust clearance. The Company expects to fund the purchase price at closing through a combination of cash on hand, fully committed debt financing and by accessing the capital markets.

Content and Distribution

•In September 2022, our NewsON business, the nation's largest streaming service for local news content, added 13 CBS local stations to its platform, bringing its total station count to over 250 and its U.S. household coverage to 92%.

•In ~~August 2017,~~October 2022, we announced a broad, multi-platform creative partnership with Anthony Zuiker, the ~~Company announced an agreement for all~~creator of ~~its ABC, CBS, FOX~~the global hit franchise CSI: Crime Scene Investigation, to work with us in developing original programming and ~~NBC affiliates to be carried in their respective markets as YouTube TV launches in those markets. As part~~content across a range of ~~this agreement, YouTube TV will also deliver Tennis Channel to all of its members.~~formats and subjects.

•In ~~August 2017, the Company~~October 2022, we announced a multi-year ~~deal~~ABC network affiliation agreement with ~~Fox Broadcasting Company ("FOX") that renews station affiliation agreements~~Disney Media & Entertainment Distribution for all five of Sinclair's Fox Affiliations that were at the end of their terms. The affiliations renewed were for WACH in Columbia, South Carolina; KFOX in El Paso, Texas; KRXI in Reno Nevada; WFXL in Albany, Georgia;our stations and ~~WSBT in South Bend, Indiana.~~

~~In September 2017, the Company entered into a multi-year deal with CBS Corporation that renews three station affiliation that were set~~stations to ~~expire at the end of 2018. In addition, CBS renewed an affiliation that was set to expire at the end of 2018 with a station that Sinclair provides~~which we provide sales and other services to under a joint sales ~~agreement.~~agreements, together covering 30 markets.

Environmental, Social, and Governance

•In July 2022, we announced that we awarded $50,000 in tuition assistance as part of our annual Diversity Scholarship program, aiming to invest in the future of the broadcast industry while helping students from diverse backgrounds. The ~~three~~program, started in 2013, was expanded nationally this year.

•To date in 2022, our newsrooms have won a total of 275 journalism awards.

NEXTGEN TV

•In August 2022, we announced that we entered into Memorandums of Understanding with two top Korean broadcast networks - Korean Broadcast Systems and Munhwa Broadcasting Corp - to collaborate on the development and implementation of NextGen broadcast models and technology in both the U.S. and Korea.

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•In 2022, we, in coordination with other broadcasters, and led by our joint venture, BitPath, have deployed NEXTGEN TV, powered by ATSC 3.0, in our 12 additional markets below. This brings the total number of our markets in which NEXTGEN TV has been deployed to 34:

Month

Market

Number of Stations

Company Stations

January 2022

Green Bay, WI

WLUK-TV (FOX), WCWF (CW)

March 2022

West Palm Beach, FL

WPEC (CBS), WWHB-CD (Azteca)

March 2022

Charleston, SC

WCIV (ABC)

March 2022

Flint, MI

WSMH (FOX), WEYI-TV(a) (NBC), WBSF(a) (CW)

March 2022

Albany, NY

WRGB (CBS), WCWN (CW)

April 2022

Richmond-Petersburg, VA

WRLH-TV (FOX)

April 2022

Omaha, NE

KPTM (FOX), KXVO(b) (TBD)

June 2022

Greenville, SC

WLOS (ABC), WMYA(b) (MNT)

June 2022

Fresno / Visalia, CA

KMPH-TV (FOX), KFRE-TV (CW)

June 2022

San Antonio, TX

KABB (FOX), WOAI (NBC), KMYS(a) (DABL)

September 2022

Roanoke / Lynchburg, VA

WSET-TV

October 2022

Wichita / Hutchinson, KS

KSAS-TV (Fox), KMTW(b) (DABL)

(a)The license and programming assets for these stations are currently owned by ~~the Company are KGAN in Cedar Rapids, Iowa, KGBT in Harlingen, Texas,~~third parties. We provide certain non-programming related sales, operational, and ~~WGME in Portland, Maine. The station to which the Company provides~~administrative services to ~~is WTVH in Syracuse, N.Y.~~these stations pursuant to service agreements, such as JSAs and SSAs.

(b)The license assets for these stations are currently owned by third parties. We provide programming, sales, operational, and administrative services to these stations pursuant to certain service agreements, such as LMAs.

In October 2017, the Company’s professional wrestling promotion Ring of Honor expanded distribution into French-speaking Canada, on the channel Reseau des Sports, making it available to over 2 million homes in Canada.

In October 2017, the Company entered into an agreement with Sony Vue under which Sony Vue will include Sinclair's ABC, CBS, FOX, and NBC affiliates station broadcast as well as Tennis, MyNetworkTV, and Comet on their platform.

~~ATSC 3.0~~

In July 2017, ONE Media entered into a definitive services agreement with Saankhya Labs for the design of a next-generation chip for ATSC 3.0 fixed and mobile reception. The parties also agreed to an investment in Saankhya Labs to provide such chips to the market. These agreements follow the previously announced incubation stage agreement between the parties that initiated the design of a new software defined radio chip architecture to support the first mobile next-generation chipset.

Financing, Capital Allocation, and Shareholder Returns

~~In August 2017,~~•For the ~~Board of Directors declared a quarterly dividend of $0.18 per share, paid on September 15, 2017 to holders of record at the close of business on September 1, 2017.~~

~~In October 2017, the Board of Directors declared a quarterly dividend of $0.18 per share, payable on December 15, 2017 to the holders of record at the close of business on December 1, 2017.~~

~~For both the three and~~ nine months ended September 30, ~~2017,~~2022, we ~~purchased~~repurchased approximately ~~1.0~~five million shares of Class A Common Stock for ~~$30.3~~$114 million. As of November 4, 2022, we repurchased an additional 0.3 million shares of Class A Common Stock, for $6 million since September 30, ~~2017, the total remaining authorization was $88.8 million.~~2022. The shares were repurchased under an SEC Rule 10b5-1 plan.

~~Other Events~~

•In August 2017, the Company awarded seven young students from diverse background the annual Broadcast Diversity Scholarship to assist them with the funds needed to help them earn college degrees in broadcast-related fields.2022 and November 2022, we declared a quarterly cash dividend of $0.25 per share, an increase of 25% over 2021 dividends.

In September 2017, the Company held the "Standing Strong for Texas" relief effort, in which viewers in our markets generously contributed almost $1.4 million to the Salvation Army. In addition, the Company donated $100,000 bringing the total to almost $1.5 million.

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RESULTS OF OPERATIONS

~~The results of the businesses acquired during 2017 and 2016 are included in our results of operations from their respective dates of acquisition. See~~ ~~Note 2. Acquisitions and Disposition of Assets~~ ~~in our consolidated financial statements for further discussion of acquisitions. Additionally, any~~Any references to the first, second, or fourth quarters are to the three months ended March 31, June 30, ~~and~~or December 31, respectively, for the year being discussed. WeFor the quarter ended September 30, 2022, we have one reportable segment, ~~“broadcast”,~~"broadcast," that is disclosed separately from our other and corporate activities. Prior to the Deconsolidation, we had two reportable segments, "broadcast" and "local sports," that were disclosed separately from our other and corporate activities.

~~SEASONALITY/CYCLICALITY~~Seasonality / Cyclicality

~~Our~~The operating results of our broadcast segment are usually subject to seasonal fluctuations. Usually, the second and fourth quarter operating results are higher than first and third quarters’ because advertising expenditures are increased in anticipation of certain seasonal and holiday spending by consumers.

~~Our operating results are usually subject to~~cyclical fluctuations from political advertising. In even numbered years, political spending is usually significantly higher than in odd numbered years due to advertising expenditures preceding local and national elections. Additionally, every four years, political spending is usually elevated further due to advertising expenditures preceding the presidential election. Also, the second and fourth quarter operating results are usually higher than the first and third quarters’ because advertising expenditures are increased in anticipation of certain seasonal and holiday spending by consumers.

The operating results of our local sports segment were subject to usual cyclical fluctuations based on the timing and overlap of the Major League Baseball ("MLB"), NBA, and NHL seasons. Usually, the second and third quarter operating results were higher than the first and fourth quarter operating results.

Operating Data

The following table sets forth our consolidated operating data for the ~~three and nine months ended September 30, 2017 and 2016~~periods presented (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Media revenues	$	836	$	1,526	$	2,942	$	4,623
Non-media revenues	7		9		26		35
Total revenues	843		1,535		2,968		4,658
Media programming and production expenses	396		1,022		1,557		3,390
Media selling, general and administrative expenses	190		228		605		675
Depreciation and amortization expenses	67		148		255		448
Amortization of program contract costs	22		22		68		67
Non-media expenses	12		11		35		42
Corporate general and administrative expenses	30		35		115		132

Gain on deconsolidation of subsidiary	—		—		(3,357)		—
Gain on asset dispositions and other, net of impairment	(28)		(4)		(37)		(26)
Operating income (loss)	$	154	$	73	$	3,727	$	(70)
Net income (loss) attributable to Sinclair Broadcast Group	$	21	$	19	$	2,597	$	(325)

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Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Media revenues (a) $ 624.2
$ 635.3
$ 1,858.5
$ 1,772.9
Revenues realized from station barter arrangements 31.8
32.0
91.8
92.6
Other non-media revenues 14.9
26.5
49.8
73.8
Total revenues 670.9
693.8
2,000.1
1,939.3
Media production expenses (a) 268.0
242.9
795.1
702.4
Media selling, general and administrative expenses (a) 133.6
126.7
385.4
370.2
Expenses recognized from station barter arrangements 26.7
27.2
77.5
79.4
Depreciation and amortization 95.9
106.1
292.2
308.2
Other non-media expenses 14.9
20.5
46.9
57.9
Corporate general and administrative expenses 25.8
19.1
71.5
54.7
Research and development 2.6
0.7
5.1
3.1
Gain on asset dispositions —
(3.3 ) (53.5 ) (6.0 )
Operating income $ 103.4
$ 153.9
$ 380.0
$ 369.4
Net income attributable to Sinclair Broadcast Group $ 30.6
$ 50.8
$ 132.5
$ 124.4
The Impact of COVID-19 on our Results of Operations

~~(a) Our media~~Overview

As of September 30, 2022, the national state of emergency related ~~revenues~~to COVID-19 is still in effect, though states have reopened their economies at various levels and ~~expenses~~various timing and COVID-19 vaccinations are ~~primarily derived from~~available. However, with new variants of COVID-19 being detected across multiple countries, it still remains unclear how the current trends of states reopening their economies will be impacted and what the overall impact of COVID-19 will be on our ~~broadcast segment, but also from~~business.

Business continuity

Within the United States, our ~~other media related~~ business ~~including~~has been designated an essential business, which allows us to continue to serve our ~~networks and content such as CHARGE!, TBD TV, Tennis Channel, COMET, and non-broadcast digital properties. The results~~customers, however, the COVID-19 pandemic has disrupted our operations. Certain of our ~~broadcast segment~~facilities have experienced temporary disruptions as a result of the COVID-19 pandemic, and we cannot predict whether our facilities will experience more significant disruptions in the ~~other media businesses are discussed further below under~~ ~~Broadcast Segment~~future and ~~Other, respectively.~~how long these disruptions will last. The COVID-19 pandemic has heightened the risk that a significant portion of our workforce will suffer illness or otherwise be unable to work. The COVID-19 pandemic has also resulted in some workers leaving the workforce which has caused wage inflation and made it more difficult for us to find qualified employees. Furthermore, additional reductions in our workforce may become necessary as a result of declines in our business caused by the COVID-19 pandemic. If we take such actions, we cannot assure that we will be able to rehire our workforce once our business has recovered.

BROADCAST SEGMENT

~~Revenue~~

The following table ~~presents~~sets forth our ~~media revenues, net of agency commissions,~~revenue and expenses for our broadcast segment for the periods presented (in millions):


	Three Months Ended September 30,				Percent Change Increase / (Decrease)	Nine Months Ended September 30,				Percent Change Increase / (Decrease)
	2022		2021			2022		2021
Revenue:
Distribution revenue	$	381	$	372	2%	$	1,158	$	1,096	6%
Advertising revenue	339		283		20%	937		830		13%
Other media revenues (a)	33		46		(28)%	111		127		(13)%
Media revenues	$	753	$	701	7%	$	2,206	$	2,053	7%

Operating Expenses:
Media programming and production expenses	$	352	$	337	4%	$	1,049	$	1,005	4%
Media selling, general and administrative expenses (b)	162		135		20%	474		420		13%
Depreciation and amortization expenses	60		61		(2)%	180		187		(4)%
Amortization of program contract costs	17		18		(6)%	55		56		(2)%
Corporate general and administrative expenses	17		30		(43)%	93		114		(18)%
Gain on asset dispositions and other, net of impairment	(7)		(6)		17%	(12)		(23)		(48)%
Operating income	$	152	$	126	21%	$	367	$	294	25%

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016
Percent
Change
2017 2016
Percent
Change
Local revenues:

Non-political $ 485.5
$ 469.6
3.4 % $ 1,456.5
$ 1,350.8
7.8 %
Political 2.0
3.7
(b)
3.6
11.4
(b)
Total local 487.5
473.3
3.0 % 1,460.1
1,362.2
7.2 %
National revenues (a):

Non-political 87.0
89.7
(3.0 )% 260.2
264.4
(1.6 )%
Political 5.3
41.3
(b)
11.2
74.7
(b)
Total national 92.3
131.0
(29.5 )% 271.4
339.1
(20.0 )%
Total broadcast segment media revenues $ 579.8
$ 604.3
(4.1 )% $ 1,731.5
$ 1,701.3
1.8 %

(a)~~National revenue relates to advertising sales sourced from our national representation firm.~~

~~(b)Political revenue is not comparable from year to year due to cyclicality of elections. See~~ ~~Political Revenues~~ ~~below for more information.~~

~~Media revenues.~~ ~~Media revenues decreased $24.5~~Includes $1 million when comparing to the three months ended September 30, 2017 to the same period in 2016. The decrease related to the three months ended September 30, 2017 is primarily related to a decrease in political revenue and a decrease in markets impacted by hurricanes during the three months ended September 30, 2017. The decrease is partially offset by a increase in retransmission and digital revenues. For the three months ended September 30, 2017, the medical, direct response, paid programming, automotive, schools, food and grocery, retail, and restaurant sectors decreased year over year, and services, pharmaceutical/cosmetics, and media sectors increased year over year, as well as $7.4 million related to the stations not included in the same period of 2016, net of dispositions.

~~Media revenues increased $30.2~~$26 million for ~~the~~three and nine months ended September 30, ~~2017 compared to~~2022, respectively, and $28 million and $82 million for the ~~same period in 2016, of which $14.5 million was related to the stations not included in the same period of 2016, net of dispositions. The increase for the~~three and nine months ended September 30, ~~2017~~2021, respectively, of intercompany revenue related to certain services provided to other and local sports, prior to the Deconsolidation, under management services agreements, which was eliminated in consolidation, and $12 million and $27 million of revenue for the three and nine months ended September 30, 2022, respectively, for services provided by broadcast under management services agreements after the Deconsolidation, which is not eliminated in consolidation.

(b)Includes $8 million and $45 million for the three and nine months ended September 30, 2022, respectively, of intercompany expense related to certain services provided to broadcast from other, which is eliminated in consolidation.

Revenue

Distribution revenue. Distribution revenue, which includes payments from Distributors for our broadcast signals, increased $9 million and $62 million for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021, primarily ~~related~~due to an increase in ~~retransmission and digital revenues and is~~contractual rates, partially offset by a decrease in ~~political~~subscribers.

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Advertising revenue. Advertising revenue increased $56 million and ~~a decrease in markets impacted by hurricanes during~~$107 million for the three ~~months ended September 30, 2017. For the~~and nine months ended September 30, ~~2017,~~2022, respectively, when compared to the services, automotive, pharmaceutical/cosmetics, entertainment, and media sectors increased year over year, and schools, telecommunications, paid programming, medical, and restaurant sectors, decreased year over year. Automotive, which typically is our largest category, represented 25.7% and 23.7%same periods in 2021, primarily due to an increase in political advertising revenue of ~~net time sales~~$77 million for the ~~nine months ended September 30, 2017~~three-month period and ~~2016, respectively.~~$139 million for the nine-month period, as 2022 is a political year, compared to 2021 which was a non-political year, partially offset by a decrease to various advertising categories, primarily automotive and services.

~~From a network affiliation or program service arrangement perspective, the~~The following table sets forth our primary types of programming and their approximate percentages of ~~our total day net time sales by affiliate~~advertising revenue, excluding digital revenue, for the periods presented:


	Percent of Advertising Revenue (Excluding Digital) for the
	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
Local news	39%	34%	38%	34%
Syndicated/Other programming	26%	27%	26%	27%
Network programming	22%	21%	22%	21%
Sports programming	10%	13%	10%	13%
Paid programming	3%	5%	4%	5%

# of channels Percent of Net Time Sales for the
Net Time Sales
Percent Change
Percent of Net Time Sales for the
Net Time Sales
Percent Change
Three months ended September 30, Nine months ended September 30,
2017 2016 2017 2016
ABC 41 29.2% 26.1% 3.1% 29.0% 27.5% 1.5%
FOX 58 24.2% 23.3% 0.9% 25.0% 24.3% 0.7%
CBS 30 18.6% 18.5% 0.1% 19.2% 19.2% —%
NBC 26 13.2% 16.7% (3.5)% 12.2% 13.4% (1.2)%
CW 47 7.5% 7.3% 0.2% 7.4% 7.6% (0.2)%
MNT 36 5.7% 6.2% (0.5)% 5.6% 6.2% (0.6)%
Other (a) 348 1.6% 1.9% (0.3)% 1.6% 1.8% (0.2)%
Total 586
The following table sets forth our affiliate percentages of advertising revenue for the periods presented:


		Percent of Advertising Revenue for the
		Three Months Ended September 30,		Nine Months Ended September 30,
	# of Channels	2022	2021	2022	2021
ABC	40	29%	31%	31%	31%
FOX	55	23%	22%	23%	23%
CBS	31	19%	18%	19%	20%
NBC	25	18%	16%	17%	14%
CW	46	5%	6%	5%	6%
MNT	40	4%	5%	4%	5%
Other (a)	401	2%	2%	1%	1%
Total	638

(a)We broadcast other programming from the following providers on our channels including: Antenna TV, ~~ASN,~~ Azteca, Bounce, CHARGE!, ~~COMET, CoziTV,~~Comet, Dabl, Decades, Estrella TV, Get TV, Grit, Me TV, ~~Movies!,~~Rewind, Stadium, ~~Network,~~ TBD, Telemundo, This TV, ~~News & Weather,~~ UniMas, Univision, and ~~Univision~~.Weather.

Other Media Revenue. Other media revenue decreased $13 million for the three months ended September 30, 2022, when compared to the same period in 2021, primarily due to a $15 million decrease in revenue from the local sports segment and other related to providing certain services under a management services agreement. Other media revenue decreased $16 million for the nine months ended September 30, 2022, when compared to the same period in 2021, primarily due to a $29 million decrease in revenue from the local sports segment and other related to providing certain services under a management services agreement, partially offset by a $6 million increase related to revenue recognized under the Bally's commercial agreement that we began performing on in the second quarter of 2021.

Expenses

~~Political Revenues.~~ ~~Political revenues decreased by $37.7~~Media programming and production expenses. Media programming and production expenses increased $15 million and ~~decreased by $71.3~~$44 million for the three and nine months ended September 30, ~~2017 and 2016,~~2022, respectively, when compared to the same periods in ~~2016. Political revenues are typically higher~~2021, primarily due to a $12 million and $39 million, respectively, increase in ~~election years such as 2016.~~fees pursuant to network affiliation agreements.

~~Local Revenues.~~ ~~Excluding political revenues, our local broadcast revenues, which include local time sales, retransmission revenues~~

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Media selling, general and ~~other local revenues,~~administrative expenses. Media selling, general and administrative expenses increased ~~$15.9~~$27 million for the three months ended September 30, ~~2017,~~2022, when compared to the same period in ~~2016, of which $6.5~~2021, primarily due to a $12 million ~~was related to the stations not included in the same period in 2016, net of dispositions.~~ ~~The increase is primarily related to an~~ increase in ~~retransmission revenue as well as an~~third-party fulfillment costs relating to our digital business, a $6 million increase in ~~fast food, telecommunications,~~information technology costs, and ~~services sectors. These increases were offset by lower revenues~~a $3 million increase in ~~the retail, schools, paid programming,~~national sales commissions. Media selling, general and ~~medical sectors, as well as a decrease in markets impacted by hurricanes during the three months ended September 30, 2017.~~

~~Excluding political revenues, our local broadcast revenues, which include local times sales, retransmission revenues and other local revenues,~~administrative expenses increased ~~by $105.7~~$54 million for the nine months ended September 30, ~~2017,~~2022, when compared to the same period in ~~2016, of which $14.7~~2021, primarily due to a $28 million ~~was related to the stations not included in the same period in 2016, net of dispositions. The increase is primarily related to an~~ increase in ~~retransmission and~~third-party fulfillment costs relating to our digital ~~revenues, as well as~~business, an $18 million increase in ~~the automotive~~information technology costs, and ~~fast food sectors. These~~a $5 million increase in both national sales commissions and building repairs and maintenance expenses, respectively. The increases were partially offset by ~~lower revenues~~$8 million in ~~the schools, paid programming, and retail sectors, as well as a decrease~~FCC penalties incurred by several consolidated VIEs that was recorded in ~~markets impacted by hurricanes during the three months ended September 30, 2017.~~

~~National Revenues.~~ ~~Excluding political revenues,~~ our national broadcast revenues, which relates to time sales sourced from our national representation firms, decreased by $2.7 million for the three months ended September 30, 2017 when compared to the same period in 2016. The decrease is primarily related to a decrease in the medical and fast food sectors, as well as a decrease in markets impacted by hurricanes during the three months ended September 30, 2017. These decreases were offset by higher revenues in the services, media, retail, and pharmaceutical/cosmetics sectors, as well as $0.8 million related to the stations not included in the same period of 2016, net of dispositions

~~Excluding political revenues, our national broadcast revenues, which relates to time sales sourced from our national representation firm, decreased by $4.2 million~~consolidated financial statements for the nine months ended September 30, ~~2017 when compared to~~2021, as discussed in Note 6. Commitments and Contingencies within the ~~same period in 2016. The decrease is primarily related to a decrease in the telecommunications, direct response, automotive, fast foods,~~Consolidated Financial Statements.

Depreciation and ~~medical sectors, as well as a decrease in markets impacted by hurricanes during the three months ended September 30, 2017. These decreases were offset by higher revenues in the media, services,~~amortization expenses. Depreciation and ~~entertainment sectors, as well as $1.4 million related to the stations not included in the same period of 2016, net of dispositions~~

~~Expenses~~

~~The following table presents our significant operating expense categories for our broadcast segment for the periods presented (in millions):~~

Three months ended September 30,
Percent Change
(Increase/(Decrease))
Nine months ended September 30, Percent Change
(Increase/(Decrease))
2017 2016 2017 2016
Media production expenses $ 242.9
$ 222.7
9.1 % $ 712.4
$ 639.2
11.5 %
Media selling, general and administrative expenses $ 114.4
$ 116.8
(2.1 )% $ 338.9
$ 344.2
(1.5 )%
Amortization of program contract costs and net realizable value adjustments $ 28.0
$ 32.4
(13.6 )% $ 88.0
$ 96.7
(9.0 )%
Corporate general and administrative expenses $ 23.6
$ 17.5
34.9 % $ 65.1
$ 50.3
29.4 %
Depreciation and amortization expenses $ 60.5
$ 62.9
(3.8 )% $ 180.7
$ 186.5
(3.1 )%

~~Media production expenses.~~ ~~Media production~~amortization expenses ~~increased $20.2~~decreased $1 million and ~~$73.2~~$7 million during the three and nine months ended September 30, 2017, respectively, compared to the same periods in 2016. The acquired stations not included in the same period of 2016, net of dispositions, contributed $3.4 million and $6.1 million of the increase for the three and nine months ended September 30, 2017, respectively. The remaining increase is primarily related to increases in fees pursuant to network affiliation agreements mainly due to higher retransmission revenue and viewership measurement costs, partially offset by a reduction of equipment maintenance costs.

~~Media selling, general and administrative expense.~~ Media selling, general and administrative expenses decreased $2.4 million for the three months ended September 30, 2017, compared to the same period in 2016. The decrease is primarily attributable to a decrease in national sales commissions, partially offset by expenses from acquired stations not included in the same period of 2016, net of dispositions.

~~Media selling, general and administrative expenses decreased $5.3 million during the nine months ended September 30, 2017~~2022, respectively, when compared to the same periods in ~~2016. The decrease for this period is~~2021, primarily ~~related~~due to ~~the settlement with the FCC in for June 2016 for the amount of $9.5 million, partially offset by higher information technology infrastructure costs~~assets retired during 2022 and ~~by expense from acquired stations not included in the same period of 2016,~~2021.

Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses.

Gain on asset dispositions and other, net of ~~dispositions.~~

~~Amortization of program contract costs and net realizable value adjustments. The amortization of program contract costs decreased $4.4 million and $8.7 million during~~impairments. For the three and nine months ended September 30, ~~2017, respectively, compared to the same periods in 2016. The decrease is primarily due to timing~~2022, we recorded gains of ~~amortization on long term contracts, reduced renewal costs, and partially offset by the increase of cost due to new programs added since the same period in 2016. Additionally, we recognized $1.5~~$1 million and ~~$3.6~~$3 million, ~~of accelerated amortization of certain program contracts during~~respectively, and for the three and nine months ended September 30, ~~2016, respectively, resulting in reduced amortization attributed to those contracts in 2017.~~

~~Corporate general and administrative expenses.~~ ~~See explanation under~~ ~~Corporate and Unallocated Expenses.~~

~~Depreciation and Amortization expenses.~~ ~~Depreciation~~2021, we recorded gains of ~~property and equipment and amortization of definite-lived intangibles and other assets decreased $2.4~~$3 million and ~~$5.8~~$22 million, ~~during~~respectively, related to reimbursements from the spectrum repack. See Note 2. Acquisitions and Dispositions of Assets within the Consolidated Financial Statements for further discussion. For the nine months ended September 30, 2022, we recorded a gain of $3 million related to the sale of certain broadcast assets. For the three and nine months ended September 30, ~~2017. These decreases are~~2021, we recorded a gain of $4 million related to the sale of certain broadcast assets. For the nine months ended September 30, 2021, we recorded a gain of $12 million related to the sale of two stations and a loss of $12 million primarily related to the write-down of the carrying value of assets ~~becoming fully depreciated, which is greater than~~of one of our stations to approximate the ~~added depreciation from capital expenditures.~~estimated selling price.

Table of Contents

LOCAL SPORTS SEGMENT

Our local sports segment reflected the results of our Bally RSNs, Marquee, and a minority interest in the YES Network prior to the Deconsolidation on March 1, 2022. See Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements. The ~~decrease~~Bally RSNs, Marquee, and YES Network own the exclusive rights to air, among other sporting events, the games of ~~these~~professional sports teams in designated local viewing areas.

The following table sets forth our revenue and expenses ~~is partially offset by depreciation~~ for our local sports segment for the periods presented (in millions):


	Three Months Ended September 30,				Percent Change Increase / (Decrease)	Nine Months Ended September 30,				Percent Change Increase / (Decrease)
	2022		2021			2022		2021
Revenue:	(b)					(c)
Distribution revenue	$	—	$	633	n/m	$	433	$	1,997	n/m
Advertising revenue	—		118		n/m	44		345		n/m
Other media revenue	—		8		n/m	5		23		n/m
Media revenue	$	—	$	759	n/m	$	482	$	2,365	n/m

Operating Expenses:
Media programming and production expenses	$	—	$	638	n/m	$	376	$	2,263	n/m

Media selling, general and administrative expenses (a)	—		79		n/m	55		221		n/m

Depreciation and amortization expenses	—		79		n/m	54		241		n/m
Corporate general and administrative	—		2		n/m	1		8		n/m

Operating loss (a)	$	—	$	(39)	n/m	$	(4)	$	(368)	n/m
Income from equity method investments	$	—	$	12	n/m	$	10	$	35	n/m

n/m - not meaningful

(a)Includes $24 million for the nine months ended September 30, 2022and ~~amortization from acquired stations of $1.0~~$27 million and ~~$1.4~~$80 million ~~during~~for the three and nine months ended September 30, ~~2017,~~2021, respectively, ~~not included~~of intercompany expense related to certain services provided by the broadcast segment under a management services agreement, which is eliminated in consolidation.

(b)There was no reportable activity in this period following the Deconsolidation on March 1, 2022. See Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements.

(c)Represents the activity prior to the Deconsolidation on March 1, 2022. See Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements.

The decrease in the revenue and expense items noted above for the nine months ended September 30, 2022, when compared to the same period in the prior year, was primarily due to the Deconsolidation, as our current period results include only two months of ~~2016, net~~activity, all of ~~dispositions.~~which occurred in the first quarter of 2022, due to the Deconsolidation, versus a full period of activity in the prior year, therefore the periods are not comparable. See Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements for further discussion.

~~OTHER~~Media revenue. Media revenue was nil for the three months ended September 30, 2022, due to the Deconsolidation, $482 million for the nine months ended September 30, 2022, and $759 million and $2,365 million for the three and nine months ended September 30, 2021, respectively, and is primarily derived from distribution and advertising revenue. Distribution revenue is generated through fees received from Distributors for the right to distribute the RSNs and advertising revenue is primarily generated from sales of commercial time within the RSN's programming.

Three months ended September 30,
Percent Change
(Increase/(Decrease))
Nine months ended September 30, Percent Change
(Increase/(Decrease))
2017 2016 2017 2016
Media revenues $ 44.5
$ 31.0
43.5 % $ 127.0
$ 71.5
77.6 %
Media expenses $ 44.4
$ 30.1
47.5 % $ 129.3
$ 89.2
45.0 %

Other non-media:
Revenues:
   Investments in real estate ventures $ 5.1
$ 5.8
(12.1 )% $ 14.5
$ 15.0
(3.3 )%
   Investments in private equity $ 6.3
$ 17.8
(64.6 )% $ 28.1
$ 49.6
(43.3 )%
   Technical services $ 3.6
$ 2.9
24.1 % $ 7.2
$ 9.2
(21.7 )%
Expenses: (a)
   Investments in real estate ventures $ 6.4
$ 6.5
(1.5 )% $ 18.4
$ 20.7
(11.1 )%
   Investments in private equity $ 6.0
$ 14.7
(59.2 )% $ 26.3
$ 41.6
(36.8 )%
   Technical services $ 4.4
$ 3.2
37.5 % $ 10.9
$ 10.1
7.9 %

Research and development expenses $ 2.6
$ 0.7
271.4 % $ 5.1
$ 3.1
64.5 %
Gain on asset dispositions $ —
$ 1.4
n/a
$ 53.2
$ 1.4
3,700.0 %
(Loss) income from equity and cost method investments $ (4.4 ) $ 1.4
(414.3 )% $ (4.2 ) $ 2.8
(250.0 )%

~~(a) Comprises total~~Media programming and production expenses. Media programming and production expenses ~~of the entity including general administrative, depreciation and amortization and applicable other income and expense items such as interest expense and non-cash stock-based compensation expense~~are primarily related to ~~issuances~~amortization of ~~subsidiary stock awards~~our sports programming rights with MLB, NBA, and ~~excludes equity method investment income.~~

NHL teams, and the costs of producing and distributing content for our brands including live games, pre-game and post-game shows, and backdrop programming. Media ~~revenues, media~~programming and production expenses were nil for the three months ended September 30, 2022, due to the Deconsolidation, $376 million for the nine months ended September 30, 2022, and ~~media~~$638 million and $2,263 million for the three and nine months ended September 30, 2021, respectively.

Table of Contents

Media selling, general, and administrative ~~expense.~~expenses. Media selling, general, and administrative expenses were nil for the three months ended September 30, 2022, due to the Deconsolidation, $55 million for the nine months ended September 30, 2022, and $79 million and $221 million for the three and nine months ended September 30, 2021, respectively, and are primarily related to management service agreement fees, employee compensation, advertising expenses, and consulting fees.

Depreciation and amortization expenses. Depreciation and amortization expenses were nil for the three months ended September 30, 2022, due to the Deconsolidation, $54 million for the nine months ended September 30, 2022, and $79 million and $241 million for the three and nine months ended September 30, 2021, respectively, and are primarily related to the depreciation of definite-lived assets and other assets.

Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses.

Income from equity method investments. Income from equity method investments was nil for the three months ended September 30, 2022, due to the Deconsolidation, $10 million for the nine months ended September 30, 2022, and $12 million and $35��million for the three and nine months ended September 30, 2021, respectively, and is primarily related to our investment in the YES Network.

OTHER

The ~~media revenue included within Other primarily relates to original~~following table sets forth our revenues and expenses for our owned networks and content, ~~as well as our~~ non-broadcast digital and internet ~~businesses. The year-over-year increase~~solutions, technical services, and non-media investments (collectively, other) for the ~~three-month period is primarily~~periods presented (in millions):


	Three Months Ended September 30,				Percent Change Increase / (Decrease)	Nine Months Ended September 30,				Percent Change Increase/(Decrease)
	2022		2021			2022		2021
Revenue:
Distribution revenue	$	44	$	48	(8)%	$	137	$	147	(7)%
Advertising revenue	46		55		(16)%	184		149		23%
Other media revenues	5		3		67%	14		9		56%
Media revenues (a)	$	95	$	106	(10)%	$	335	$	305	10%
Non-media revenues (b)	$	8	$	11	(27)%	$	33	$	40	(18)%

Operating Expenses:
Media expenses (c)	$	81	$	99	(18)%	$	289	$	255	13%
Non-media expenses (d)	$	13	$	12	8%	$	40	$	44	(9)%
(Gain) loss on asset dispositions and other, net of impairment	$	(11)	$	2	n/m	$	(15)	$	(3)	n/m
Operating income (loss)	$	8	$	(9)	n/m	$	18	$	15	20%
Income (loss) from equity method investments	$	33	$	—	n/m	$	38	$	(12)	n/m

n/m - not meaningful

(a)Media revenues for the three and nine months ended September 30, 2022 include $8 million and $51 million, respectively, and for the three and nine months ended September 30, 2021 include $10 million and $15 million, respectively, of intercompany revenues related to ~~an increase in content fees from MVPDs for Tennis, as well as increases in revenue from our other original networks,~~certain services and ~~from our non-broadcast digital and internet businesses. Our expenses relate~~sales provided to the ~~programming~~broadcast segment, which are eliminated in consolidation.

(b)Non-media revenues for the three and ~~production,~~nine months ended September 30, 2022 include $1 million and ~~general~~$7 million, respectively, and ~~administrative costs~~for the three and nine months ended September 30, 2021 include $2 million and $5 million, respectively, of intercompany revenues related to ~~the operations of our network, content,~~certain services and non-broadcast digital and internet businesses. The year-over-year increases primarily relate to Tennis, which was acquired during the first quarter of 2016, and general and administrative costs relatedsales provided to the ~~start-up of our original networks and content, production costs of new original programming, and new non-broadcast digital and internet initiatives such as Circa News.~~broadcast segment, which are eliminated in consolidation.

~~Other non-media revenues and expenses:~~

~~Investments in real estate ventures.~~ ~~We have controlling interests in certain real estate investments owned by Keyser Capital which we consolidate. The decrease in revenue and~~(c)Media expenses for the three and nine months ended September 30, ~~2017 compared to the same period of 2016, primarily relates to decreases in the sale of land~~2022 include $1 million and ~~lot parcels with our real estate development projects.~~

~~Investments in private equity.~~ ~~We have controlling interests in certain private equity investments owned by Keyser Capital, which we consolidate; that includes Triangle Sign & Service, LLC, a sign designer~~$9 million, respectively, and ~~fabricator; and Alarm, a regional security alarm operating and bulk acquisition company which we sold in March 2017. The decrease in revenues and expenses~~ for ~~both~~ the three and nine months ended September 30, ~~2017 is~~2021 include $10 million and $16 million, respectively, of intercompany expenses primarily ~~due~~related to certain services provided by the ~~sale of Alarm in early March 2017.~~

~~Technical Services.~~ ~~We own certain subsidiaries~~broadcast segment, which are ~~dedicated~~eliminated in consolidation.

(d)Non-media expenses for the three and nine months ended September 30, 2022 include $1 million and $5 million, respectively, and for the three and nine months ended September 30, 2021 include $1 million and $2 million, respectively, of intercompany expenses related to ~~providing broadcast related technical~~certain services toand sales provided by the broadcast industry including: Acrodyne Technical Services, a provider of service and support for broadcast transmitters throughout the world and Dielectric, a designer and manufacturer of broadcast systems including all components from transmitter output to antenna.

~~Research and development expenses.~~ Our research and development expenses relate to the costs to develop the Advanced Television Systems Committee's 3.0 standard (ATSC 3.0) along with related products and services through our consolidated subsidiaries, ONE Media and ONE Media 3.0.

~~Gain on asset dispositions.~~ In March 2017, we sold Alarm for $200.0 million less working capital and transaction costs. We recognized a gain on the sale of Alarm of $53.0 million of which $12.3 million was attributable to non-controlling interests which is included in the gain on asset dispositions and net income attributable to the noncontrolling interest, respectively, on the consolidated statement of operations.

~~(Loss) income from Equity and Cost Method Investments.~~ ~~We recognize income from certain real estate, private equity, media, and digital ventures for which we hold as equity and cost method investments.~~

~~CORPORATE AND UNALLOCATED EXPENSES~~

Three months ended September 30, Percent Change
(Increase/ (Decrease)) Nine months ended September 30, Percent Change
(Increase/ (Decrease))
2017 2016 2017 2016
Corporate general and administrative expenses $ 2.0
$ 1.3
53.8 % $ 5.6
$ 3.3
69.7 %
Interest expense $ 50.3
$ 50.4
(0.2 )% $ 154.4
$ 147.8
4.5 %
Income tax provision $ (17.1 ) $ (27.0 ) (36.7 )% $ (70.6 ) $ (65.8 ) 7.3 %
Loss from extinguishment of debt $ —
$ (23.7 ) n/a
$ (1.4 ) $ (23.7 ) (94.1 )%

~~Corporate general and administrative expenses.~~ ~~We allocate most of our corporate general and administrative expenses to the broadcast segment. The explanation that follows combines the corporate general and administrative expenses found in the~~ ~~Broadcast Segment~~ ~~section with the corporate general and administrative expenses found in this section,~~ ~~Corporate and Unallocated Expenses. These results exclude general and administrative costs from our other non-media businesses and investments~~segment, which are ~~included~~eliminated in ~~our discussion~~consolidation.

Table of ~~expenses in the~~ ~~Other~~ ~~section above.~~Contents

~~Corporate general and administrative expenses increased in total by $6.8~~Revenue. Media revenue decreased $11 million for the three months ended September 30, ~~2017,~~2022, when compared to the same period in ~~2016. The increase is~~2021, primarily due to ~~$8.8 million~~a decrease in ~~expenses incurred related to legal and consulting fees~~distribution revenue related to our ~~completed and pending acquisitions, and spectrum auction expenses, as well as $0.4 million of~~owned networks. Media revenue increased ~~employee compensation costs related to merit increases, partially offset by a $2.5 million decrease in health insurance costs.~~

~~Corporate general and administrative expenses increased in total by $17.1~~$30 million for the nine months ended September 30, ~~2017,~~2022, when compared to the same period in ~~2016. The increase is~~2021, primarily due to ~~$14.8 million~~an increase in ~~expenses incurred related to legal and consulting fees~~advertising revenue related to our ~~completed~~digital initiatives. Non-media revenue decreased $3 million and ~~pending acquisitions,~~$7 million for the three and ~~spectrum auction~~nine months ended September 30, 2022, respectively, when compared to the same periods in 2021, primarily due to the sale of Triangle Sign & Service, LLC (Triangle) in the second quarter of 2021 and due to a decrease in broadcast equipment sales due to the winding down of the FCC's National Broadband Plan repack process.

Expenses. Media expenses ~~as well as $2.4~~decreased $18 million for the three months ended September 30, 2022, when compared to the same period in 2021, primarily due to decreases in programming and production costs related to our owned networks. Media expenses increased $34 million for the nine months ended September 30, 2022, when compared to the same period in 2021, primarily due to our digital sales initiatives. Non-media expenses remained flat for the three months ended September 30, 2022, when compared to the same period in 2021. Non-media expenses decreased $4 million for the nine months ended September 30, 2022, when compared to the same period in 2021, primarily due to the sale of Triangle in the second quarter of 2021 .

Other Income/Expense. Gain on asset dispositions and other, net of impairment increased $13 million and $12 million for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021, primarily due to insurance proceeds received related to the cybersecurity incident that occurred in the fourth quarter of 2021. Income from equity method investments increased $33 million and $50 million for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021, primarily due to the sale of one of our investments.

CORPORATE AND UNALLOCATED EXPENSES

The following table presents our corporate and unallocated expenses for the periods presented (in millions):


	Three Months Ended September 30,				Percent Change Increase/ (Decrease)	Nine Months Ended September 30,				Percent Change Increase/ (Decrease)
	2022		2021			2022		2021
Corporate general and administrative expenses	$	30	$	35	(14)%	$	115	$	132	(13)%
Gain on deconsolidation of subsidiary	$	—	$	—	n/m	$	(3,357)	$	—	n/m
Interest expense including amortization of debt discount and deferred financing costs	$	59	$	155	(62)%	$	228	$	466	(51)%
Other income (expense), net	$	10	$	(4)	n/m	$	(155)	$	59	n/m
Income tax (provision) benefit	$	(109)	$	91	n/m	$	(756)	$	169	n/m

Net income attributable to the redeemable noncontrolling interests	$	(5)	$	(4)	25%	$	(14)	$	(13)	8%
Net (income) loss attributable to the noncontrolling interests	$	(3)	$	6	n/m	$	(28)	$	(27)	4%

n/m - not meaningful

Corporate general and administrative expenses. The table above and the explanation that follows cover total consolidated corporate general and administrative expenses. Corporate general and administrative expenses decreased in total by $5 million for the three months ended September 30, 2022, when compared to the same period in 2021, primarily due to a $5 million decrease in legal, consulting, and regulatory costs.

Corporate general and administrative expenses decreased in total by $17 million for the nine months ended September 30, 2022, when compared to the same period in 2021, primarily due to a $21 million decrease in employee compensation costs related to ~~merit increases.~~the reduction-in-force severance and termination benefits that occurred in the first quarter of 2021, as well as compensation expense savings within the current period as a result of the reduction-in-force, partially offset by a $3 million increase in information technology costs.

We expect corporate general and administrative expenses to ~~decrease~~increase in the fourth quarter of ~~2017~~2022 when compared to the third quarter of ~~2017.~~2022.

Gain on deconsolidation of subsidiary. During the first quarter of 2022 we recorded a gain of $3,357 million related to the Deconsolidation, as discussed in Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements.

Table of Contents

Interest ~~expense.~~expense including amortization of debt discount and deferred financing costs. The table above and explanation that follows ~~combines the~~cover total consolidated interest ~~expense included within the~~ ~~Broadcast Segment~~ ~~with the interest expense found in this section,~~ ~~Corporate and Unallocated Expenses~~.expense. Interest expense decreased by ~~$0.3~~$96 million and $238 million for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021, primarily due to a decrease in DSG interest expense due to the Deconsolidation, as discussed in Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements.

We expect interest expense to increase in the fourth quarter of 2022 when compared to the third quarter of 2022.

Other income (expense), net. Other income increased by $14 million for the three months ended September 30, ~~2017 compared to the same period in 2016. The decrease is primarily related to the net effect of the redemption of $350~~2022 and decreased by $214 million ~~of 6.375% senior unsecured notes (6.375% Notes) and the offering of $400 million of senior unsecured notes in August 2016 bearing a more favorable interest rate of 5.125% (5.125% Notes).~~

~~Interest expense increased $6.3 million during~~for the nine months ended September 30, ~~2017,~~2022, when compared to the same ~~period~~periods in ~~2016~~2021, primarily due to ~~$6.4 million~~changes in ~~debt financing fees expensed related to~~ the ~~amendment~~fair value of certain ~~terms and extension of~~investments recorded at fair value. See Note 3. Other Assets within the ~~maturity date of Term Loan B under the existing bank credit agreement, partially offset by the net effect of the redemption of the 6.375% Notes and offering~~ Consolidated Financial Statements for ~~5.125% Notes. See~~ ~~Liquidity and Capital Resources~~ ~~for more~~further information.

Income tax (provision) benefit. The effective tax rate for the three months ended September 30, ~~2017, including the effects of the noncontrolling interest~~2022, was a provision of ~~35.8%~~78.3% as compared to a ~~provision~~benefit of ~~34.7%~~124.6% during the same ~~periods~~period in ~~2016.~~2021. The

~~increase~~ decrease in the effective tax rate for the three months ended September 30, ~~2017,~~2022, as compared to the same period in ~~2016,~~2021, is primarily due to ~~a 2016 reduction in liability for unrecognized tax benefits+~~

-the 2021 discrete benefit as a result of ~~statute~~the CARES Act allowing for the 2020 federal net operating loss to be carried back to pre-2018 years when the federal tax rate was 35%, offset by the impact of ~~limitations expiration.~~valuation allowance on deferred tax assets relating to deductibility of interest expense under the IRC Section 163(j).

The effective tax rate for the nine months ended September 30, 2022, was a provision of 22.3% as compared to a benefit of 37.3% during the same period in 2021. The decrease in the effective tax rate for the nine months ended September 30, ~~2017, including the effects of noncontrolling interest was a provision of 34.8%~~2022, as compared to the same period in 2021, is primarily due to the 2021 discrete benefit as a ~~provision~~result of ~~34.6% during~~the CARES Act allowing for the 2020 federal net operating loss to be carried back to pre-2018 years when the federal tax rate was 35%.

Net income attributable to the redeemable noncontrolling interests. Net income attributable to the redeemable noncontrolling interests increased by $1 million during both the three and nine months ended September 30, 2022, when compared to the same periods in ~~2016.~~2021.

~~Loss from extinguishment~~Net (income) loss attributable to the noncontrolling interests. Net income attributable to the noncontrolling interests increased $9 million during the three months ended September 30, 2022, when compared to the same period in 2021, primarily due to the Deconsolidation, as discussed in Deconsolidation of ~~debt.~~ ~~In January 2017, we entered into an amendment~~Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements. Net income attributable to ~~our Bank Credit Agreement that includes extended maturity for some Term Loan positions and more favorable rates. As a result, we recognized a loss~~the noncontrolling interests increased $1 million during the nine months ended September 30, 2022, when compared to the same period in 2021.

Table of ~~$1.4 million from the extinguishment of debt. See~~ ~~Note 3. Notes Payable and Commercial Bank Financing~~ ~~for further discussion.~~Contents

LIQUIDITY AND CAPITAL RESOURCES

As of September 30, ~~2017,~~2022, we had ~~cash and cash equivalent balances and~~ net working capital of approximately ~~$678.2 million.~~$875 million, including $607 million in cash and cash equivalent balances. Cash on hand, cash generated by our operations, and borrowing capacity under the Bank Credit Agreement are used as our primary sources of liquidity.

The Bank Credit Agreement includes a financial maintenance covenant, the first lien leverage ratio (as defined in the Bank Credit Agreement), which requires such ratio not to exceed 4.5x, measured as of the end of each fiscal quarter. As of September 30, ~~2017, we had $484.4~~2022, the STG first lien leverage ratio was below 4.5x. Under the Bank Credit Agreement, a financial maintenance covenant is only applicable if 35% or more of the capacity (as a percentage of total commitments) under the revolving credit facility, measured as of the last day of each fiscal quarter, is utilized under the revolving credit facility as of such date. Since there was no utilization under the revolving credit facility as of September 30, 2022, STG was not subject to the financial maintenance covenant under the Bank Credit Agreement. The Bank Credit Agreement contains other restrictions and covenants with which STG was in compliance as of September 30, 2022.

On April 21, 2022, STG entered into the Fourth Amendment to the Bank Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent, the Guarantors and the lenders and other parties thereto. Pursuant to the Fourth Amendment, STG raised the Term Loan B-4 in an aggregate principal amount of $750 million, which matures on April 21, 2029. The proceeds from the Term Loan B-4 were used to refinance all of STG’s outstanding Term Loan B-1 due January 2024 and to redeem the outstanding STG 5.875% Notes. In addition, the maturity of $612.5 million of ~~borrowing capacity available~~the total $650 million of revolving commitments under the Bank Credit Agreement were extended to April 21, 2027, with the remaining $37.5 million continuing to mature on December 4, 2025.

During the nine months ended September 30, 2022, we purchased $118 million aggregate principal amount of the STG 5.125% Notes in open market transactions for consideration of $104 million. The STG 5.125% Notes acquired during the nine months ended September 30, 2022 were canceled immediately following their acquisition.

As of March 1, 2022, we no longer consolidate the debt of DSIH. See Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements. As of September 30, 2022, our ~~revolving credit facility.~~total debt, defined as current and long-term notes payable, finance leases, and commercial bank financing, including finance leases of affiliates, was $4,269 million, including current debt, due within the next 12 months, of $43 million.

~~In January 2017,~~During the nine months ended September 30, 2022, we entered into ~~an amendment~~agreements which increased estimated contractual amounts owed for network programming rights by $1,085 million. Other than as a result of the Deconsolidation, there were no other material changes to our ~~Bank Credit Agreement that includes extending maturity for some Term Loan positions and more favorable rates. See~~ ~~Note 3. Notes Payable and Commercial Bank Financing~~ ~~for further discussion.~~contractual cash obligations as of September 30, 2022.

We anticipate that existing cash and cash equivalents, cash flow from our operations, and borrowing capacity under the Bank Credit Agreement will be sufficient to satisfy our debt service obligations, capital expenditure requirements, and working capital needs for the next twelve months. However, certain factors, including but not limited to, the severity and duration of the COVID-19 pandemic and the war in Ukraine and resulting effect on the economy, our advertisers, Distributors, and their subscribers, could affect our liquidity and our first lien leverage ratio which could affect our ability to access the full borrowing capacity under the Bank Credit Agreement. For our long-term liquidity needs, in addition to the sources described above, we may rely upon various sources, such as but not limited to, the issuance of long-term debt, the issuance of equity or other instruments convertible into or exchangeable for equity, or the sale of ~~non-core~~Company assets. However, there can be no assurance that additional financing or capital or buyers of our ~~non-core~~Company assets will be available, or that the terms of any transactions will be acceptable or advantageous to us. ~~In connection with the pending acquisition~~

Table of ~~Tribune, we entered into certain commitments and facilities to finance the acquisition. See~~ ~~Note 3. Notes Payable and Commercial Bank Financing~~ ~~for further discussion.~~Contents

Sources and Uses of Cash

The following table sets forth our cash flows for the periods presented (in millions):

For the three months ended September 30, For the nine months ended September 30,
2017 2016 2017 2016
Net cash flows from operating activities $ 136.9
$ 120.6
$ 278.4
$ 330.3

Cash flows (used in) from investing activities:

Acquisition of property and equipment $ (22.0 ) $ (18.8 ) $ (55.5 ) $ (68.6 )
Acquisition of businesses, net of cash acquired (241.5 ) (2.8 ) (269.8 ) (425.9 )
Purchase of alarm monitoring contracts —
(7.5 ) (5.7 ) (29.1 )
Proceeds from sale of non-media business —
16.4
192.6
16.4
Investments in equity and cost method investees (1.6 ) (12.4 ) (22.3 ) (34.2 )
Loans to affiliates —
—
—
(19.5 )
Other 2.6
(4.0 ) (0.5 ) 3.4
Net cash flows used in investing activities $ (262.5 ) $ (29.1 ) $ (161.2 ) $ (557.5 )

Cash flows (used in) from financing activities:

Proceeds from notes payable, commercial bank financing and capital leases $ 3.0
$ 403.8
$ 166.0
$ 1,011.3
Repayments of notes payable, commercial bank financing and capital leases (17.1 ) (374.4 ) (318.3 ) (654.0 )
Net proceeds from the sale of Class A Common Stock —
—
487.9
—
Dividends paid on Class A and Class B Common Stock (18.3 ) (16.9 ) (53.1 ) (49.7 )
Repurchase of outstanding Class A Common Stock (30.3 ) (89.9 ) (30.3 ) (101.2 )
Other (5.5 ) (13.3 ) (27.3 ) (24.7 )
Net cash flows (used in) from financing activities $ (68.2 ) $ (90.7 ) $ 224.9
$ 181.7


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net cash flows from operating activities	$	251	$	247	$	458	$	235

Cash flows used in investing activities:
Acquisition of property and equipment	$	(29)	$	(24)	$	(74)	$	(62)

Proceeds from the sale of assets	—		4		9		43
Purchases of investments	(6)		(80)		(67)		(244)
Deconsolidation of subsidiary cash	—		—		(315)		—
Distributions from investments	9		5		90		11
Spectrum repack reimbursements	1		4		3		22

Other, net	2		1		2		(1)
Net cash flows used in investing activities	$	(23)	$	(90)	$	(352)	$	(231)

Cash flows used in financing activities:
Proceeds from notes payable and commercial bank financing	$	—	$	—	$	728	$	357
Repayments of notes payable, commercial bank financing and finance leases	(9)		(15)		(854)		(400)

Dividends paid on Class A and Class B Common Stock	(16)		(16)		(53)		(46)

Repurchase of outstanding Class A Common Stock	(10)		—		(114)		—

Distributions to noncontrolling interests, net	(5)		(13)		(10)		(63)

Other, net	(1)		(20)		(15)		(53)
Net cash flows used in financing activities	$	(41)	$	(64)	$	(318)	$	(205)

Operating Activities

Net cash flows from operating activities increased during the three months ended September 30, ~~2017~~2022, when compared to the same period in ~~2016. The increase is~~2021, primarily ~~related~~due to ~~higher~~a partial period of payments for production and overhead costs, distributor rebate payments, and payments for sports rights as a result of the Deconsolidation, partially offset by the partial period of cash ~~received~~collections from ~~customers compared to~~Distributors and advertisers as a result of the ~~same period~~Deconsolidation, as discussed in Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the ~~prior year.~~Consolidated Financial Statements.

Net cash flows from operating activities ~~decreased~~increased during the nine months ended September 30, ~~2017~~2022, when compared to the same period in ~~2016. The decrease is~~2021, primarily ~~related~~due to ~~increased~~a partial period of payments ~~to vendors~~for production and ~~tax~~overhead costs, distributor rebate payments, and payments for sports rights as a result of the Deconsolidation, partially offset by ~~higher~~the partial period of cash ~~received~~collections from ~~customers compared to~~Distributors and advertisers as a result of the ~~same period~~Deconsolidation, as discussed in Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the ~~prior year.~~Consolidated Financial Statements.

Investing Activities

Net cash flows used in investing activities ~~increased~~decreased during the three months ended September 30, ~~2017~~2022, when compared to the same period in ~~2016. This increase is~~2021, primarily ~~related~~due to ~~the acquisition~~lower purchases of ~~Bonten in September 2017, partially offset by a decrease in investment in equity and cost method investments compared to the same period in 2016.~~investments.

Net cash flows used in investing activities ~~decreased~~increased during the nine months ended September 30, ~~2017~~2022, when compared to the same period in ~~2016. This decrease is~~2021, primarily ~~related to proceeds received from the sale of Alarm Funding in March 2017, a decrease in acquisition activity, a decrease in capital expenditures, and a decrease in loans to affiliates compared~~due to the ~~same~~2022 partial period ~~in 2016.~~

Indue to the ~~fourth quarter of 2017, we anticipate capital expenditures to increase from the third quarter of 2017. As~~Deconsolidation, as discussed in Deconsolidation of Diamond Sports Intermediate Holdings LLC under Note ~~4. Commitments~~1. Nature of Operations and ~~Contingencies~~Summary of Significant Accounting Policies within the Consolidated Financial Statements, ~~certain~~partially offset by increased distributions from investments and decreased purchases of ~~our channels have been reassigned in conjunction with the FCC repacking process. We expect that the majority~~investments.

Table of ~~expenditures will be reimbursed by the fund established by the Auction.~~Contents

Financing Activities

Net cash flows used in financing activities decreased ~~for~~during the three months ended September 30, ~~2017,~~2022, when compared to the same period in ~~2016. The decrease is~~2021, primarily due to ~~lower repurchases of Class A common stock,~~decreased distributions to noncontrolling interests, partially offset by ~~proceeds from~~ the ~~issuance of debt during 2016.~~

Net cash flows from financing activities increased for the nine months ended September 30, 2017, compared to the same period in 2016. The increase is primarily due to the proceeds received from the public offeringrepurchase of Class A Common Stock during the ~~first quarter of 2017 and lower repurchases~~three months ended September 30, 2022.

Net cash flows used in financing activities increased during the nine months ended September 30, 2022, when compared to the same period in 2021, primarily due to the repurchase of Class A ~~common stock,~~Common Stock during the nine months ended September 30, 2022, the redemption of STG's Term Loan B-1, the redemption of the STG 5.875% Notes, and the partial redemption of the STG 5.125% Notes, partially offset by the ~~repayment of notes payable in conjunction with the sale of Alarm during the first quarter of 2017 and~~ proceeds from the ~~issuance of our 5.875% Notes, net of repayments on our revolving credit facility, during the first quarter of 2016.~~Term Loan B-4 issuance.

In ~~October 2017,~~August and November 2022, our Board of Directors declared a quarterly dividend of ~~$0.18~~$0.25 per ~~share.~~share, a 25% increase over 2021 dividends. Future dividends on our shares of common ~~shares,~~stock, if any, will be at the discretion of our Board of Directors and will depend on several factors including our results of operations, cash requirements and surplus, financial condition, covenant restrictions, and other factors that the Board of Directors may deem relevant.

~~CONTRACTUAL CASH OBLIGATIONS~~

~~See~~ ~~Bank Credit Agreement~~ ~~within~~ ~~Note 3. Notes Payable and Commercial Bank Financing~~ ~~for the amendment of the Bank Credit Agreement in January 2017.~~

~~As of September 30, 2017, there were no other material changes to our contractual cash obligations.~~

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

There were no changes to the critical accounting policies and estimates from those disclosed in Critical Accounting Policies and Estimates ~~with~~ under Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations within our Annual Report on Form 10-K for the year ended December 31, 2021.

The impact of the COVID-19 outbreak and the war in Ukraine continues to create significant uncertainty and disruption in the global economy and financial markets. It is reasonably possible that these uncertainties will continue to impact our estimates related to, but not limited to, revenue recognition, goodwill and intangible assets, and income taxes. As a result, many of our ~~2016 Annual Report.~~estimates and assumptions require increased judgment and carry a higher degree of variability and volatility. Our estimates may further change in the future as the COVID-19 pandemic and the war in Ukraine continue, new events occur, and additional information emerges, and such changes are recognized or disclosed in our consolidated financial statements.

~~See~~ ~~Recent Accounting Pronouncements~~ ~~within~~ ~~Note 1. Nature of Operations and Summary of Significant Accounting Policies~~ ~~for a discussion of new accounting guidance.~~

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~Other than the foregoing, there~~There have been no material changes from the quantitative and qualitative discussion about market risk previously disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2021.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures and Internal Control over Financial Reporting

Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the design and effectiveness of our disclosure controls and procedures and our internal control over financial reporting as of September 30, ~~2017.~~2022.

The term ~~“disclosure~~"disclosure controls and procedures,”" as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Table of Contents

The term ~~“internal~~"internal control over financial reporting,”" as defined in Rules 13a-15d-15(f) under the Exchange Act, means a process designed by, or under the supervision of our Chief Executive Officer and Chief Financial ~~Officers~~Officer and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles ~~(GAAP)~~("GAAP") and includes those policies and procedures that:

•pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

•provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made in accordance with authorizations of management or our Board of Directors; and

•provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material adverse effect on our financial statements.

Assessment of Effectiveness of Disclosure Controls and Procedures

Based on the evaluation of our disclosure controls and procedures as of September 30, ~~2017,~~2022, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

During the quarters ended June 30, 2017 and September 30, 2017, we completed the implementation of a new enterprise resource planning (ERP) system and human capital management (HCM) system, respectively. Both systems are functioning as designed. We have made appropriate changes to our internal controls as a result of the implementation of these new systems.

~~Other than as discussed above, there~~There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, ~~2017,~~2022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management’s override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Table of Contents

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are party to lawsuits and claims from time to time in the ordinary course of business. Actions currently pending are in various stages and no material judgments or decisions have been rendered by hearing boards or courts in connection with such actions. ~~After reviewing developments~~

See Litigation under Note 6. Commitments and Contingencies within the Consolidated Financial Statements for discussion related to ~~date with legal counsel, our management is of the opinion that none of our~~certain pending ~~and threatened matters are material.~~lawsuits.

ITEM 1A. RISK FACTORS

~~There~~As of the date of this report, there have been no material changes to the ~~Risk Factors contained~~risk factors we previously disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2021.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table summarizes repurchases of our stock in the quarter ended September 30, ~~2017:~~2022:


Period	Total Number of Shares Purchased (a)	Average Price Per Share		Total Number of Shares Purchased as Part of a Publicly Announced Program	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Program (in millions)
Class A Common Stock: (b)
07/01/22 - 07/31/22	422,018	$	20.60	422,018	$	705
08/01/22 - 08/31/22	67,033	$	21.83	67,033	$	704
09/01/22 - 09/30/22	—	$	—	—	$	—

Period Total Number of Shares Purchased (1) Average Price Per Share Total Number of Shares Purchased as Part of a Publicly Announced Program Approximate Dollar Value of Shares That May Yet Be Purchased Under the Program (in millions)
Class A Common Stock : (2)
07/01/17 – 07/31/17 —
—
—
—

08/01/17 – 08/31/17 997,300
$ 30.37
997,300
$ 88.8

09/01/17 – 09/30/17 —
—
—
—

~~(1)~~(a)All repurchases were made in open-market ~~transactions.~~transactions and were repurchased under an SEC Rule 10b5-1 plan.

~~(2)~~(b)On October 28, 1999, we announced a $150.0 million share repurchase program, which was renewed on February 6, 2008. On March 20, 2014, the Board of Directors authorized a new $150.0 million shares of Class A Common Stock repurchase authorization. In September 2016,August 4, 2020, the Board of Directors authorized an additional ~~$150.0~~$500 million ~~shares~~share repurchase authorization in addition to the previous repurchase authorization of ~~Class A Common Stock repurchase authorization.~~$1 billion. There is no expiration date and currently, management has no plans to terminate this program. As of September 30, ~~2017,~~2022, the ~~total~~ remaining authorization under the program was ~~$88.8~~$704 million.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

Table of Contents

ITEM 6. EXHIBITS



Exhibit Number		Description
31.1**
~~10.1~~	~~Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, Inc. and Christopher Ripley, President and Chief Executive Officer, dated August 23, 2017.~~

~~10.2~~	~~Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, Inc. and Lucy Rutishauser, Senior Vice President, Chief Financial Officer and Treasurer, dated August 28, 2017.~~

~~10.3~~	~~Stock Appreciation Right Agreement by and between Sinclair Broadcast Group, Inc. and Christopher Ripley, President and Chief Executive Officer, dated August 29, 2017.~~

~~10.4~~	~~Restricted Stock Award Agreement by and between Sinclair Broadcast Group, Inc. and Christopher Ripley, President and Chief Executive Officer, dated August 29, 2017.~~

~~10.5~~	~~Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, Inc. and Steve Marks, Executive Vice President and Chief Operating Officer, dated August 31, 2017.~~

~~31.1~~	Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(a) of the Exchange Act (15 U.S.C. § 7241).
31.2**
~~31.2~~	Certification by Lucy Rutishauser, as Chief Financial Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(a) of the Exchange Act (15 U.S.C. § 7241).
32.1**
~~32.1~~	Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(b) of the Exchange Act and § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C § 1350).
32.2**
~~32.2~~	Certification by Lucy Rutishauser, as Chief Financial Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(b) of the Exchange Act and § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C § 1350).
101*		The Company's Consolidated Financial Statements and related Notes for the quarter ended September 30, 2022 from this Quarterly Report on Form 10-Q, formatted in iXBRL (Inline eXtensible Business Reporting Language).*
~~101.INS~~ 104		~~XBRL Instance Document~~

~~101.SCH~~	~~XBRL Taxonomy Extension Schema~~

~~101.CAL~~	~~XBRL Taxonomy Extension Calculation Linkbase~~

~~101.LAB~~	~~XBRL Taxonomy Extension Label Linkbase~~

~~101.PRE~~	~~XBRL Taxonomy Extension Presentation Linkbase~~

~~101.DEF~~	~~XBRL Taxonomy Extension Definition Linkbase~~ Cover Page Interactive Data File (included in Exhibit 101).

* Filed herewith.

** In accordance with Item 601(b)(32) of Regulation S-K, this Exhibit is not deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

Table of Contents

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized on the ~~8th~~9th day of November ~~2017.~~2022.



			SINCLAIR BROADCAST GROUP, INC.


			By:			/s/ David R. Bochenek
						David R. Bochenek
						Senior Vice President/Chief Accounting Officer
						(Authorized Officer and Chief Accounting Officer)

~~EXHIBIT INDEX~~



~~Exhibit~~ ~~Number~~		~~Description~~

~~10.1~~		~~Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, Inc. and Christopher Ripley, President and Chief Executive Officer, dated August 23, 2017.~~

~~10.2~~		~~Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, Inc. and Lucy Rutishauser, Senior Vice President, Chief Financial Officer and Treasurer, dated August 28, 2017.~~

~~10.3~~		~~Stock Appreciation Right Agreement by and between Sinclair Broadcast Group, Inc. and Christopher Ripley, President and Chief Executive Officer, dated August 29, 2017.~~

~~10.4~~		~~Restricted Stock Award Agreement by and between Sinclair Broadcast Group, Inc. and Christopher Ripley, President and Chief Executive Officer, dated August 29, 2017.~~

~~10.5~~		~~Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, Inc. and Steve Marks, Executive Vice President and Chief Operating Officer, dated August 31, 2017.~~

~~31.1~~		~~Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(a) of the Exchange Act (15 U.S.C. § 7241).~~

~~31.2~~		~~Certification by Lucy Rutishauser, as Chief Financial Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(a) of the Exchange Act (15 U.S.C. § 7241).~~

~~32.1~~		Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(b) of the Exchange Act and § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C § 1350).

~~32.2~~		Certification by Lucy Rutishauser, as Chief Financial Officer of Sinclair Broadcast Group, Inc., pursuant to Rule 13a-14(b) of the Exchange Act and § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C § 1350).

~~101.INS~~		~~XBRL Instance Document~~

~~101.SCH~~		~~XBRL Taxonomy Extension Schema~~

~~101.CAL~~		~~XBRL Taxonomy Extension Calculation Linkbase~~

~~101.LAB~~		~~XBRL Taxonomy Extension Label Linkbase~~

~~101.PRE~~		~~XBRL Taxonomy Extension Presentation Linkbase~~

~~101.DEF~~		~~XBRL Taxonomy Extension Definition Linkbase~~



	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016
Total revenues	$	685,382	$	714,451	$	2,056,790	$	2,014,195
Net Income	$	34,303	$	54,437	$	155,532	$	134,504
Net Income attributable to Sinclair Broadcast Group	$	32,374	$	53,249	$	138,712	$	130,646
Basic earnings per share attributable to Sinclair Broadcast Group	$	0.32	$	0.57	$	1.40	$	1.38
Diluted earnings per share attributable to Sinclair Broadcast Group	$	0.31	$	0.56	$	1.38	$	1.37



PART I. FINANCIAL INFORMATION		32

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)		3

CONSOLIDATED BALANCE SHEETS		4

CONSOLIDATED STATEMENTS OF OPERATIONS		5

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME		6

CONSOLIDATED ~~STATEMENT~~STATEMENTS OF EQUITY (DEFICIT) AND REDEEMABLE NONCONTROLLING INTERESTS		7

CONSOLIDATED STATEMENTS OF CASH FLOWS		9

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS		10

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		3638

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		4952

ITEM 4. CONTROLS AND PROCEDURES		4952

PART II. OTHER INFORMATION		5154

ITEM 1. LEGAL PROCEEDINGS		5154

ITEM 1A. RISK FACTORS		5154

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		5154

ITEM 3. DEFAULTS UPON SENIOR SECURITIES		5154

ITEM 4. MINE SAFETY DISCLOSURES		5154

ITEM 5. OTHER INFORMATION		5154

ITEM 6. EXHIBITS		5255

SIGNATURE		5356

~~EXHIBIT INDEX~~	54



	As of September 30, 2017			As of December 31, 2016
ASSETS
Current assets:
Cash and cash equivalents	$	602,193		$	259,984
Restricted cash	312,802			200
Accounts receivable, net of allowance for doubtful accounts of $2,510 and $2,124, respectively	523,111			513,954
Current portion of program contract costs	97,768			83,601
Income taxes receivable	5,080			5,500
Prepaid expenses and other current assets	37,384			36,067
Deferred barter costs	11,093			5,782
Total current assets	1,589,431			905,088
Program contract costs, less current portion	4,513			8,919
Property and equipment, net	724,125			717,576
Restricted cash	1,501			—
Goodwill	2,113,651			1,990,746
Indefinite-lived intangible assets	168,720			156,306
Definite-lived intangible assets, net	1,841,938			1,944,403
Notes Receivable from affiliates	19,500			19,500
Other assets	223,690			220,630
Total assets (a)	$	6,687,069		$	5,963,168
LIABILITIES AND EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities	$	290,848		$	322,505
Deferred spectrum auction proceeds	310,802			—
Income taxes payable	1,500			23,491
Current portion of notes payable, capital leases and commercial bank financing	164,485			171,131
Current portion of notes and capital leases payable to affiliates	2,183			3,604
Current portion of program contracts payable	130,892			109,702
Deferred barter revenues	10,513			6,040
Total current liabilities	911,223			636,473
Long-term liabilities:
Notes payable, capital leases and commercial bank financing, less current portion	3,876,134			4,014,932
Notes payable and capital leases to affiliates, less current portion	12,824			14,181
Program contracts payable, less current portion	46,026			53,836
Deferred tax liabilities	661,745			609,317
Other long-term liabilities	70,818			76,493
Total liabilities (a)	5,578,770			5,405,232
Commitments and contingencies (See Note 4)
Equity:
Sinclair Broadcast Group shareholders’ equity:
Class A Common Stock, $.01 par value, 500,000,000 shares authorized, 76,032,524 and 64,558,207 shares issued and outstanding, respectively	760			646
Class B Common Stock, $.01 par value, 140,000,000 shares authorized, 25,670,684 and 25,670,684 shares issued and outstanding, respectively, convertible into Class A Common Stock	257			257
Additional paid-in capital	1,318,155			843,691
Accumulated deficit	(176,370		)	(255,804		)
Accumulated other comprehensive loss	(807		)	(807		)
Total Sinclair Broadcast Group shareholders’ equity	1,141,995			587,983
Noncontrolling interests	(33,696		)	(30,047		)
Total equity	1,108,299			557,936
Total liabilities and equity	$	6,687,069		$	5,963,168



	September 30, 2017		December 31, 2016
ASSETS
Current assets:
Restricted cash	$	122,948	$	—
Accounts receivable	18,820		21,879
Other current assets	12,851		12,076
Total current assets	154,619		33,955

Program contract costs, less current portion	1,091		2,468
Property and equipment, net	6,418		2,996
Goodwill and indefinite-lived intangible assets	16,475		16,475
Definite-lived intangible assets, net	76,487		79,509
Other assets	5,601		6,871
Total assets	$	260,691	$	142,274

LIABILITIES
Current liabilities:
Deferred spectrum auction proceeds	$	122,948	$	—
Other current liabilities	23,899		18,992

Long-term liabilities:
Notes payable, capital leases and commercial bank financing, less current portion	15,043		19,449
Program contracts payable, less current portion	12,063		14,353
Other long-term liabilities	8,452		12,921
Total liabilities	$	182,405	$	65,715



Accounts receivable	14,665
Prepaid expenses and other current assets	699
Program contract costs	683
Property and equipment	23,019
Definite-lived intangible assets	157,979
Indefinite-lived intangible assets	8,363
Other assets	3,609
Accounts payable and accrued liabilities	(8,481		)
Program contracts payable	(783		)
Deferred tax liability	(65,789		)
Other long term liabilities	(3,409		)
Fair value of identifiable net assets acquired	130,555
Goodwill	110,716
Total purchase price, net of cash acquired	$	241,271



Accounts receivable	17,629
Prepaid expenses and other current assets	6,518
Property and equipment	5,964
Definite-lived intangible assets	272,686
Indefinite-lived intangible assets	23,400
Other assets	619
Accounts payable and accrued liabilities	(7,414		)
Capital leases	(115		)
Deferred tax liability	(16,991		)
Other long term liabilities	(1,669		)
Fair value of identifiable net assets acquired	300,627
Goodwill	53,427
Total purchase price, net of cash acquired	$	354,054



Nine months ended September 30, 2017	Broadcast		Other				Corporate			Consolidated
Revenue	$	1,821,248	$	178,867			$	—		$	2,000,115
Depreciation of property and equipment	65,850		5,438				738			72,026
Amortization of definite-lived intangible assets and other assets	114,810		17,489				—			132,299
Amortization of program contract costs and net realizable value adjustments	87,962		—				—			87,962
General and administrative overhead expenses	65,059		785				5,614			71,458
Research and development	—		5,053				—			5,053
Operating income (loss)	361,259		25,016			(a)	(6,351		)	379,924
Interest expense	3,976		1,633				154,411			160,020
Loss from equity and cost method investments	—		(4,221		)		—			(4,221		)



Nine months ended September 30, 2016	Broadcast		Other			Corporate			Consolidated
Revenue	$	1,790,561	$	148,697		$	—		$	1,939,258
Depreciation of property and equipment	69,469		4,063			798			74,330
Amortization of definite-lived intangible assets and other assets	117,038		20,159			—			137,197
Amortization of program contract costs and net realizable value adjustments	96,722		—			—			96,722
General and administrative overhead expenses	50,320		1,075			3,277			54,672
Research and development	—		3,055			—			3,055
Operating income (loss)	402,236		(28,699		)	(4,130		)	369,407
Interest expense	4,297		4,695			147,827			156,819
Income from equity and cost method investments	—		414			2,375			2,789



	As of September 30, 2017		As of December 31, 2016
	Carrying Value (a)	Fair Value	Carrying Value (a)	Fair Value
6.125% Senior Unsecured Notes due 2022	500,000	516,170	500,000	521,240
5.875% Senior Unsecured Notes due 2026	350,000	359,342	350,000	351,456
5.625% Senior Unsecured Notes due 2024	550,000	565,637	550,000	562,755
5.375% Senior Unsecured Notes due 2021	600,000	615,714	600,000	617,892
5.125% Senior Unsecured Notes due 2027	400,000	389,156	400,000	382,028
Term Loan A	241,073	241,374	272,198	271,517
Term Loan B	1,359,725	1,361,425	1,365,625	1,364,841
Debt of variable interest entities	20,585	20,585	23,198	23,198
Debt of other operating divisions	27,470	27,470	135,211	135,211



Balance Sheet Data:	September 30, 2017		December 31, 2016
Cash and cash equivalents	$	602,193	$	259,984
Total assets	$	6,687,069	$	5,963,168
Total debt (c)	$	4,055,626	$	4,203,848
Total equity	$	1,108,299	$	557,936



	# of channels	Percent of Net Time Sales for the		Net Time Sales Percent Change	Percent of Net Time Sales for the		Net Time Sales Percent Change
		Three months ended September 30,			Nine months ended September 30,
		2017	2016		2017	2016
ABC	41	29.2%	26.1%	3.1%	29.0%	27.5%	1.5%
FOX	58	24.2%	23.3%	0.9%	25.0%	24.3%	0.7%
CBS	30	18.6%	18.5%	0.1%	19.2%	19.2%	—%
NBC	26	13.2%	16.7%	(3.5)%	12.2%	13.4%	(1.2)%
CW	47	7.5%	7.3%	0.2%	7.4%	7.6%	(0.2)%
MNT	36	5.7%	6.2%	(0.5)%	5.6%	6.2%	(0.6)%
Other (a)	348	1.6%	1.9%	(0.3)%	1.6%	1.8%	(0.2)%
Total	586



~~Yes~~ o		No x



	Three months ended September 30,				Percent Change (Increase/(Decrease))		Nine months ended September 30,				Percent Change (Increase/(Decrease))
	2017		2016		Percent Change (Increase/(Decrease))		2017		2016		Percent Change (Increase/(Decrease))
Media production expenses	$	242.9	$	222.7	9.1	%	$	712.4	$	639.2	11.5	%
Media selling, general and administrative expenses	$	114.4	$	116.8	(2.1	)%	$	338.9	$	344.2	(1.5	)%
Amortization of program contract costs and net realizable value adjustments	$	28.0	$	32.4	(13.6	)%	$	88.0	$	96.7	(9.0	)%
Corporate general and administrative expenses	$	23.6	$	17.5	34.9	%	$	65.1	$	50.3	29.4	%
Depreciation and amortization expenses	$	60.5	$	62.9	(3.8	)%	$	180.7	$	186.5	(3.1	)%



	Three months ended September 30,						Percent Change (Increase/ (Decrease))		Nine months ended September 30,						Percent Change (Increase/ (Decrease))
	2017			2016			Percent Change (Increase/ (Decrease))		2017			2016			Percent Change (Increase/ (Decrease))
Corporate general and administrative expenses	$	2.0		$	1.3		53.8	%	$	5.6		$	3.3		69.7	%
Interest expense	$	50.3		$	50.4		(0.2	)%	$	154.4		$	147.8		4.5	%
Income tax provision	$	(17.1	)	$	(27.0	)	(36.7	)%	$	(70.6	)	$	(65.8	)	7.3	%
Loss from extinguishment of debt	$	—		$	(23.7	)	n/a		$	(1.4	)	$	(23.7	)	(94.1	)%



	For the three months ended September 30,						For the nine months ended September 30,
	2017			2016			2017			2016
Net cash flows from operating activities	$	136.9		$	120.6		$	278.4		$	330.3

Cash flows (used in) from investing activities:
Acquisition of property and equipment	$	(22.0	)	$	(18.8	)	$	(55.5	)	$	(68.6	)
Acquisition of businesses, net of cash acquired	(241.5		)	(2.8		)	(269.8		)	(425.9		)
Purchase of alarm monitoring contracts	—			(7.5		)	(5.7		)	(29.1		)
Proceeds from sale of non-media business	—			16.4			192.6			16.4
Investments in equity and cost method investees	(1.6		)	(12.4		)	(22.3		)	(34.2		)
Loans to affiliates	—			—			—			(19.5		)
Other	2.6			(4.0		)	(0.5		)	3.4
Net cash flows used in investing activities	$	(262.5	)	$	(29.1	)	$	(161.2	)	$	(557.5	)

Cash flows (used in) from financing activities:
Proceeds from notes payable, commercial bank financing and capital leases	$	3.0		$	403.8		$	166.0		$	1,011.3
Repayments of notes payable, commercial bank financing and capital leases	(17.1		)	(374.4		)	(318.3		)	(654.0		)
Net proceeds from the sale of Class A Common Stock	—			—			487.9			—
Dividends paid on Class A and Class B Common Stock	(18.3		)	(16.9		)	(53.1		)	(49.7		)
Repurchase of outstanding Class A Common Stock	(30.3		)	(89.9		)	(30.3		)	(101.2		)
Other	(5.5		)	(13.3		)	(27.3		)	(24.7		)
Net cash flows (used in) from financing activities	$	(68.2	)	$	(90.7	)	$	224.9		$	181.7



Period	Total Number of Shares Purchased (1)	Average Price Per Share		Total Number of Shares Purchased as Part of a Publicly Announced Program	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Program (in millions)
Class A Common Stock : (2)
07/01/17 – 07/31/17	—	—		—	—
08/01/17 – 08/31/17	997,300	$	30.37	997,300	$	88.8
09/01/17 – 09/30/17	—	—		—	—