EXHIBIT 10.1

 

                              EMPLOYMENT AGREEMENT

 

     THIS EMPLOYMENT  AGREEMENT (this  "Agreement") is effective as of this 12th

day of June 1998 (the "Effective Date"), between Sinclair Broadcast Group, Inc.,

a Maryland corporation ("SBG"), and J. Duncan Smith ("Employee").

 

                                 R E C I T A L S

 

          A. SBG, through its wholly owned subsidiaries and affiliates,  owns or

operates television and radio broadcast stations.

 

          B. Employee is currently employed as a Vice President of SBG.

 

          C. SBG desires to continue to employ  Employee as a Vice  President of

SBG, and Employee desires to accept such employment.

 

          D. SBG and  Employee  desire to set forth the terms of  employment  of

Employee with SBG as a Vice President.

 

     NOW, THEREFORE,  IN CONSIDERATION OF the mutual covenants herein contained,

the parties hereto agree as follows:

 

     1.   DUTIES.

 

          1.1. DUTIES UPON  EMPLOYMENT.  Upon the terms and subject to the other

provisions  of this  Agreement,  commencing  on the date hereof (the  "Effective

Date"),  Employee will continue to be employed by SBG in Baltimore,  Maryland as

Secretary to SBG. As Secretary, Employee will:

 

               (a) report to the SBG Board of Directors (the  "Board"),  and the

Chief Executive Officer of SBG (the "CEO"); and

 

               (b) have such  responsibilities  and  perform  such duties as may

from time to time be established by the CEO, and/or the Board.

 

                                       1

 

<PAGE>

 

          1.2 PERFORMANCE OF SERVICES. While an employee of SBG, Employee agrees

to contribute  his best efforts and time to the business of SBG and shall render

the  services to the best of his ability on behalf of SBG.  The  Employee  shall

comply with all laws, statutes, rules and regulations relating to his services.

 

     2.   TERM.

 

          2.1.  TERM.  The term of Employee's  employment as a Vice President of

SBG under this  Agreement  (the  "Employment  Term") will begin on the Effective

Date and continue until his employment is terminated in accordance  with Section

4. As used in this  Agreement,  an  "employment  year"  is a twelve  (12)  month

period,  beginning  on January 1 and ending on the next  following  December 31;

provided, however, that the first "employment year" shall begin on the Effective

Date and shall end on December 31,1998.

 

          2.2.  AT  WILL  EMPLOYMENT.  Notwithstanding  anything  else  in  this

Agreement,  including, without limitation, the provisions of Sections 2.1. and 3

regarding  the  employment  term and  compensation  and  benefits  of  Employee,

respectively,  the employment of Employee is not for a specified period of time,

and SBG may  terminate  the  employment  of Employee  with or without  Cause (as

defined below) at any time. There is not, nor will there be, unless in a writing

signed by all of the parties to this Agreement, any express or implied agreement

as to the continued employment of Employee.

 

     3.   COMPENSATION AND BENEFITS.

 

          3.1  COMPENSATION.  During each  employment  year,  Employee  shall be

entitled to the compensation  determined by the SBG Compensation  Committee (the

"Committee")  after consulting with the CEO, which  compensation may include the

right to earn either  discretionary  cash or stock  bonuses (the  "Discretionary

Bonuses") or incentive bonuses (the "Incentive  Bonuses") (see Section 3.3 below

with respect to Incentive  Bonuses).  Discretionary  and  Incentive  Bonuses are

sometimes  collectively  referred to herein as  "Bonuses".  All Bonuses shall be

determined and payable after all financial data necessary for the  determination

of such is  available  to the  Company.  During  the  first  year of  employment

pursuant to this Agreement, the Employee shall be paid based upon an annual base

salary (the "Base Salary") of One Hundred Ninety Thousand Dollars ($190,000.00).

 

          3.2 VACATION AND BENEFITS. During each twelve (12) month period during

the  Employment  Term, the Employee shall be entitled to a paid vacation of four

(4) weeks.  The  Employee  shall  schedule his vacation at such time or times as

shall be

 

                                       2

 

<PAGE>

 

approved by SBG, which approval shall not be unreasonably withheld.

 

          3.3  INCENTIVE BONUSES.

 

               3.3.1  INCENTIVE  BONUS.  In  addition  to the  Base  Salary  and

Discretionary  Bonus,  if any,  the  Employee  shall be entitled to receive with

respect to each calendar year (or portion  thereof) during the Employment  Term,

an Incentive  Bonus in the event that the  Broadcast  Cash Flow (the "BCF"),  as

defined below,  of SBG for such year exceeds the BCF of SBG for the  immediately

preceding year. The Incentive Bonus shall be paid by granting the Employee stock

options  (the  "Stock  Options")  to acquire a certain  number of Class A Common

Shares of SBG (the "Option Shares") pursuant to the SBG Long Term Incentive Plan

currently in effect and in accordance with the FORM OF SINCLAIR BROADCAST GROUP,

INC. 1996 LONG-TERM  INCENTIVE PLAN NON-QUALIFIED STOCK OPTION AGREEMENT SPECIAL

PERFORMANCE  OPTION (the "Stock Option  Agreement")  attached hereto as Schedule

3.3.1.  BCF is defined  below in Section  3.3.3.  The  percentage  increase (the

"Percentage  Increase")  in BCF which is  necessary  for the Employee to earn an

Incentive  Bonus,  the  number of Option  Shares to be  granted  based  upon the

Percentage Increase, and the exercise price (the "Exercise Price") of the Option

Shares appear in Exhibit A attached hereto.

 

               3.3.2 AFTER ACQUIRED OR DISPOSED OF BROADCAST PROPERTIES.

 

     If during any year after the Effective  Date  (including the year of during

which  the  Effective  Date  occurs),  SBG,  or any of its  direct  or  indirect

subsidiaries or affiliates, shall acquire, program, or commence program services

for, one or more television or radio stations  [including  pursuant to any Local

Marketing  Agreement  Time Brokerage  Agreement (as those terms are  customarily

used or defined  by the FCC or in the  broadcast  industry  in  general)  or any

similar type services agreements], for the purposes of calculating the Incentive

Bonus  for the year in  which  the  acquisition  has  occurred,  the BCF for the

immediately preceding year shall be increased to reflect such acquisition, or if

in any year SBG, of any of it direct or  indirect  subsidiaries  or  affiliates,

directly  or  indirectly  disposes  of, or shall  cease to  provide  programming

services  with  respect to one or more  television  or radio  stations,  for the

purposes of  calculating  the Incentive  Bonus with respect to the year in which

such disposition has occurred,  the BCF of the immediately  preceding year shall

be  decreased  to reflect  such  disposition,  by an amount equal to the Average

Broadcast  Flow (the "ABCF"),  calculated as of the date of the  acquisition  or

disposition,  of the  television  or radio  station (or stations) so acquired or

disposed of, multiplied by a fraction,  (a) the numerator of which is the number

of days remaining in such year following such acquisition or disposition and (b)

the denominator

 

                                       3

 

<PAGE>

 

of which is 365. ABCF is defined in Section 3.3.3 below.

 

               3.3.3  DEFINITION  OF BCF AND ABCF.  As used in this Section 3.3,

the term BCF shall mean,  for any period,  operating  income (from the ownership

of, or the providing of program services to,  television or radio stations) plus

(a)  non-cash  expenses,   including   depreciation  and  amortization  expense,

programming  amortization  expense,  barter  expense and  deferred  compensation

expense, plus (b) corporate expense (including any special bonuses paid to other

executive  officers of SBG), less (c) film contract  payments,  cash payments on

deferred compensation and non-cash broadcast revenue, in each case as such items

shall be determined in accordance with generally accepted accounting  principals

("GAAP");  and ABCF shall mean the average  annual BCF of a television  or radio

station  for the  three (3) full  calendar  years of such  station  prior to its

acquisition by SBG or one of its direct or indirect subsidiaries or affiliates.

 

               3.3.4 PAYMENT.  The Incentive Bonus shall be paid to the Employee

as soon as practicable, but in no event later than March 31 following the end of

each calendar  year.  The amount of Option Shares due under the Incentive  Bonus

with  respect to any period of less than an entire year shall be  determined  by

multiplying  the Option  Shares that would have been payable with respect to the

whole of such year (using  actual  results for such year and  assuming  that the

Agreement  had been in effect the entire year) by a fraction,  the  numerator of

which is the number of days of such year and the denominator of which is 365.

 

     4.   EMPLOYMENT TERMINATION.

 

          4.1. TERMINATION OF EMPLOYMENT.

 

               (a) The  Employment  Term will end, and the parties will not have

any  rights or  obligations  under  this  Agreement  (except  for the rights and

obligations under those Sections of this Agreement which are continuing and will

survive the end of the  Employment  Term,  as  specified in Section 8.10 of this

Agreement)  on the earliest to occur of the following  events (the  "Termination

Date"):

 

                    (1) the death of Employee;

 

                    (2) the  Disability  (as defined in Section 4.1(b) below) of

Employee;

 

 

                                       4

 

<PAGE>

 

                    (3) the termination of Employee's employment by Employee;

 

                    (4) the  termination  of  Employee's  employment  by SBG for

Cause (as defined in Section 4.1(c) below); or

 

                    (5) the termination of Employee's  employment by SBG without

Cause.

 

               (b)  For  the  purposes  of this  Agreement,  "Disability"  means

Employee's  inability,  whether mental or physical, to perform the normal duties

of  Employee's  position  for ninety (90) days  (which need not be  consecutive)

during any twelve (12) consecutive month period,  and the effective date of such

Disability shall be the day next following such ninetieth (90th) day. If SBG and

Employee are unable to agree as to whether  Employee is  disabled,  the question

will be decided by a physician to be paid by SBG and designated by SBG,  subject

to the approval of Employee (which  approval may not be  unreasonably  withheld)

whose determination will be final and binding on the parties.

 

               (c) For the purposes of this Agreement,  "Cause" means any of the

following:  (i) the wrongful  appropriation for Employee's own use or benefit of

property or money  entrusted to Employee by SBG, (ii) the  commission of any act

involving moral  turpitude,  (iii)  Employee's  continued  willful  disregard of

Employee's  duties and  responsibilities  hereunder after written notice of such

disregard  and the  reasonable  opportunity  to  correct  such  disregard,  (iv)

Employee's  continued  violation  of SBG  policy  after  written  notice of such

violations  (such policy may include  policies as to drug or alcohol  abuse) and

the reasonable  opportunity to cure such violations,  (v) any action by Employee

which is  reasonably  likely to jeopardize a Federal  Communications  Commission

license  of  any  broadcast  station  owned  directly  or  indirectly  by SBG or

programmed  by SBG,  (vi)  the  continued  insubordination  of  Employee  and/or

Employee's  repeated  failure to follow the reasonable  directives of the CEO or

the Board after written notice of such  insubordination or the failure to follow

such reasonable directives, or (vii) the repeated unsatisfactory  performance by

Employee of Employee's  job or duties  hereunder as determined by the CEO or the

Board in his or their sole discretion after written notice thereof.

 

          4.2. TERMINATION PAYMENTS.

 

               (a) If  Employee's  employment  with SBG  terminates  pursuant to

Sections  4.1(a)(1),  4.1(a)(2),  4.1(a)(3),  or 4.1(a)(5),  Employee (or in the

event of the death

 

                                       5

 

<PAGE>

 

of  Employee,  the  person  or  persons  designated  by  Employee  in a  written

instrument  delivered  to SBG prior to  Employee's  death or, if no such written

designation has been made,  Employee's estate) will be entitled to receive,  and

SBG will pay to the same, all of the following:

 

               (1) the salary payable to Employee through the Termination  Date;

 

and

 

               (2) the  benefits,  if any, set forth in the Long Term  Incentive

Plan,  upon the terms and conditions  set forth therein,  but only to the extent

that  Employee is entitled to such  benefits  pursuant to the  provisions of the

Long Term Incentive Plan.

 

          (b) If Employee's  employment with SBG terminates  pursuant to Section

4.1(a)(4),  Employee will be entitled to receive,  and SBG will pay to Employee,

only the salary payable to Employee  through the Termination  Date (and Employee

shall not be  entitled  to any  benefits  under the Long Term  Incentive  Plan);

provided,   however,  that  if  Employee's  employment  terminates  pursuant  to

Subsection (vii) of Section 4.1(c),  Employee shall be entitled to the benefits,

if any, set forth in the Long Term Incentive  Plan in accordance  with the terms

of Subsection (3) of this Section 4.2.

 

          (c) If the  Employee's  employment  with SBG  terminates  pursuant  to

Section 4.1(a)(5),  the Employee,  in addition to the benefits he is entitled to

receive pursuant to Section 4.2(a),  shall be entitled to receive, and SBG shall

pay to the  Employee,  one (1)  month's  base  salary  in  effect at the time of

termination  (not  including  bonuses)  for  each  full  year of his  continuous

employment with SBG or its predecessor  regardless of whether the employment has

been pursuant to this Agreement or has been prior to this Agreement.

 

          (d) The termination payments (the "Termination Payments") described in

this Section 4 will be in lieu of any other  termination  or severance  payments

required by any other SBG policy  (whether  existing  previously or currently or

adopted in the future)  or, to the fullest  extent  permissible  thereunder,  or

under applicable law (including  unemployment  compensation) and the Termination

Payments will constitute  Employee's  exclusive rights and remedies with respect

to termination of Employee's employment.

 

                                       6

 

<PAGE>

 

     5.   CONFIDENTIALITY AND NON-COMPETITION.

 

          5.1. CONFIDENTIAL INFORMATION.

 

               (a)  Employee will:

 

                    (1) keep all  Confidential  Information in trust for the use

and benefit of SBG and any affiliate or subsidiary  (collectively,  the "Company

Entities") and broadcast  stations  owned or operated  directly or indirectly by

any of the Company Entities;

 

                    (2) not, except as required by Employee's  duties under this

Agreement,  authorized  in  writing by SBG or as  required  by law or any order,

rule, or regulation of any court or  governmental  agency (but only after notice

to SBG of such  requirement),  at any time  during or after the  termination  of

Employee's   employment  with  SBG,   directly  or  indirectly,   use,  publish,

disseminate,  distribute, or otherwise disclose any Confidential Information (as

defined below);

 

                    (3) take  all  reasonable  steps  necessary,  or  reasonably

requested  by any of the  Company  Entities,  to  ensure  that all  Confidential

Information  is  kept  confidential  for  the use  and  benefit  of the  Company

Entities; and

 

                    (4) upon  termination  of  Employee's  employment  or at any

other time any of the Company's Entities in writing so request, promptly deliver

to such  Company  Entity all  materials  constituting  Confidential  Information

relating to such Company  Entity  (including  all copies) that are in Employee's

possession  or under  Employee's  control.  If  requested  by any of the Company

Entities  to return  any  Confidential  Information,  Employee  will not make or

retain any copy of or extract from such materials.

 

               (b) For purposes of this Section  5.1,  Confidential  Information

means any proprietary or  confidential  information of or relating to any of the

Company  Entities  that is not generally  available to the public.  Confidential

Information  includes  all  information  developed  by or for any of the Company

Entities  concerning  marketing used by any of the Company Entities,  suppliers,

any customers (including advertisers) with which any of the Company Entities has

dealt prior to the Termination  Date,  plans for development of new services and

expansion into new areas or markets, internal operations, financial information,

operations,  budgets,  and any trade secrets or  proprietary  information of any

type owned by any of the Company Entities,  together with all written,  graphic,

other  materials  relating to all or any of the same,  and any trade  secrets as

defined in the Maryland

 

                                       7

 

<PAGE>

 

Uniform Trade Secrets Act, as amended from time to time.

 

          5.2. NON-COMPETITION.

 

               (a)  During  the  Employment  Term  and for  twelve  (12)  months

thereafter,  if Employee's  employment  is terminated  for any reason other than

pursuant to Section 4.1(a)(5), Employee will not, directly or indirectly, engage

in the following conduct within any Designated Market Area (as defined below) or

any Metro  Survey Area (as defined  below) in which any of the Company  Entities

owns or operates a broadcast station immediately prior to such termination:

 

                    (i) participate in any activity involved in the ownership or

operation  of a  broadcast  station  (other  than,  during  the term,  broadcast

stations owned or operated by any of the Company Entities);

 

                    (ii) hire, attempt to hire, or to assist any other person or

entity  in hiring  or  attempting  to hire any  employee  of any of the  Company

Entities or any person who was an employee of any of the Company Entities within

the prior one (1) year period; or

 

                    (iii)  solicit,  in  competition  with  any of  the  Company

Entities,  the  business of any  customer of any of the Company  Entities or any

entity whose business any of the Company  Entities  solicited during the one (1)

year period prior to Employee's termination.

 

               (b) Notwithstanding  anything else contained in this Section 5.2,

Employee may own, for  investment  purposes only, up to five percent (5%) of the

stock of any  publicly-held  corporation  whose  stock  is  either  listed  on a

national stock exchange or on the NASDAQ  National  Market System if Employee is

not otherwise affiliated with such corporation.

 

               (c) As used herein,  "participate"  means  lending one's name to,

acting as consultant or advisor to, being employed by or acquiring any direct or

indirect  interest in any  business  or  enterprise,  whether as a  stockholder,

partner, officer, director, employee, consultant, or otherwise.

 

               (d) In the event that (i) SBG places all or substantially  all of

its  broadcast  stations  up for sale within one (1) year after  termination  of

Employee's employment hereunder,  or (ii) Employee's employment is terminated in

connection with the

 

                                       8

 

<PAGE>

 

disposition  of all or  substantially  all of such stations  (whether by sale of

assets,  equity,  or otherwise),  Employee agrees to be bound by, and to execute

such  additional  instruments  as may be  necessary  or  desirable  to  evidence

Employee's   agreement  to  be  bound  by,  the  terms  and  conditions  of  any

non-competition  provisions relating to the purchase and sale agreement for such

stations,  without any  consideration  beyond that expressed in this  Agreement,

provided  that the purchase and sale  agreement is negotiated in good faith with

customary terms and  provisions,  and the  transaction  contemplated  thereby is

consummated.  Notwithstanding the foregoing, in no event shall Employee be bound

by, or obligated to enter into, any  non-competition  provisions  referred to in

this Section  5.2(d) which extend  beyond  Twelve (12) months  (including in the

case of terminations pursuant to Section 4.1(a)(5)),  in each case from the date

of  termination  of Employee's  employment  hereunder or whose scope extends the

scope of the non-competition  provisions set forth in Section 5.2(a) (as limited

by Sections 5.2(b) and (c) above).

 

               (e) The twelve (12) month time period  referred to above shall be

tolled on a day-for-day basis for each day during which Employee participates in

any activity in violation of this Section 5.2 of this Agreement so that Employee

is restricted from engaging in the conduct referred to in this Section 5.2 for a

full twelve (12) months.

 

               (f) For  purposes of this  Section  5.2,  designated  market area

shall mean the  Designated  Market Area  ("DMA") as defined by The A.C.  Nielsen

Company  (or  such  other  similar  term  as is  used  from  time to time in the

television broadcast community).

 

               (g) For  purposes of this  Section  5.2,  Metro Survey Area shall

mean the Metro Survey Area ("MSA"), as defined from time to time by the Arbitron

Company  (or such other  similar  term as is used from time to time in the radio

broadcast community).

 

          5.3.  ACKNOWLEDGMENT.  Employee  acknowledges  and  agrees  that  this

Agreement (including, without limitation, the provisions of Sections 5 and 6) is

a condition of  Employee's  continued  employment by SBG,  Employee's  continued

access to Confidential Information,  Employee's continued eligibility to receive

the items referred to in Sections 3 (including,  without limitation,  Employee's

eligibility  to  participate  in  the  Long  Term  Incentive  Plan),  Employee's

continued  advancement  at SBG, and  Employee  being  eligible to receive  other

special  benefits at SBG; and further,  that this Agreement is entered into, and

is reasonably  necessary,  to protect the Company Entities'  previous and future

investment in Employee's  training and development,  and to protect the goodwill

and other business interests of the Company Entities.

 

                                       9

 

<PAGE>

 

     6.   REMEDIES.

 

          6.1.  INJUNCTIVE  RELIEF.  The covenants and obligations  contained in

Section 5 relate to matters which are of a special,  unique,  and  extraordinary

character  and a  violation  of any of the  terms  of such  Section  will  cause

irreparable  injury  to the  Company  Entities,  the  amount  of  which  will be

impossible to estimate or determine and which cannot be adequately  compensated.

Therefore,  the Company Entities will be entitled to an injunction,  restraining

order or  other  equitable  relief  from any  court  of  competent  jurisdiction

(subject to such terms and conditions  that the court  determines  appropriate),

restraining  any  violation  or  threatened  violation  of any of such  terms by

Employee and such other persons as the court orders. The parties acknowledge and

agree that judicial action, rather than arbitration, is appropriate with respect

to the  enforcement of the provisions of Section 5. The forum for any litigation

hereunder  shall be the Circuit  Court of Baltimore  County or the United States

District Court (Northern Division) sitting in Baltimore, Maryland.

 

          6.2.  CUMULATIVE RIGHTS AND REMEDIES.  Rights and remedies provided by

Sections 5 and 6 are  cumulative  and are in  addition  to any other  rights and

remedies any of the Company Entities may have at law or equity.

 

     7. ABSENCE OF RESTRICTIONS.  Employee warrants and represents that Employee

is not a party to or bound by any agreement, contract, or understanding, whether

of employment  or otherwise,  with any third person or entity which would in any

way restrict or prohibit Employee from undertaking or performing employment with

SBG in accordance with the terms and conditions of this Agreement.

 

     8.   MISCELLANEOUS.

 

          8.1.  ATTORNEYS'  FEES.  In  any  action,  litigation,  or  proceeding

(collectively,  "Action")  between the parties  arising out of or in relation to

this Agreement,  the prevailing party in the Action will be awarded, in addition

to any damages, injunctions, or other relief, and without regard to whether such

Action is prosecuted to final appeal, such party's costs and expenses, including

reasonable attorneys' fees.

 

          8.2.  HEADINGS.  The  descriptive  headings  of the  Sections  of this

Agreement are inserted for  convenience  only,  and do not  constitute a part of

this Agreement.

 

                                       10

 

<PAGE>

 

          8.3. NOTICES. All notices and other communications  hereunder shall be

in writing and shall be deemed given upon (a) oral or written  confirmation of a

receipt  of a  facsimile  transmission,  (b)  confirmed  delivery  of a standard

overnight  courier or when  delivered by hand, or (c) the expiration of five (5)

business  days after the date  mailed,  postage  prepaid,  to the parties at the

following addresses:

 

                  If to SBG to:              Sinclair Broadcast Group, Inc.

                                             2000 W. 41st Street

                                             Baltimore, Maryland 21211

 

                                             Attn:  Chief Executive Officer

 

                  Copy to:                   Thomas & Libowitz, P.A.

                                             Suite 1100

                                             100 Light Street

                                             Baltimore, Maryland 21202-1053

 

                                             Attn:  Steven A. Thomas

 

                  If to Employee to:         J. Duncan Smith

                                             2000 W. 41st Street

                                             Baltimore, Maryland 21211

 

or to such other address as will be furnished in writing by any party.  Any such

notice or  communication  will be  deemed  to have been  given as of the date so

mailed.

 

          8.4.  ASSIGNMENT.  SBG may assign this  Agreement to any company which

acquires  all or  substantially  all of its  assets  or  into  which  it  merges

regardless of whether it survives as the successor,  and in such an event and so

long as his employment continues hereunder,  Employee hereby consents and agrees

to be bound by any such assignment by SBG. Employee may not assign, transfer, or

delegate  Employee's  rights or obligations under this Agreement and any attempt

to do so is void.  This Agreement is binding on and inures to the benefit of the

parties,   their   permitted   successors   and  assigns,   and  the  executors,

administrators,  and other legal  representatives  of  Employee.  No other third

parties,  other than Company Entities,  shall have, or are intended to have, any

rights under this Agreement.

 

          8.5.  COUNTERPARTS.  This  Agreement  may be  signed  in  one or  more

counterparts.

 

          8.6.  GOVERNING LAW. THIS  AGREEMENT  SHALL BE

 

                                       11

 

<PAGE>

 

GOVERNED BY THE LAWS OF THE STATE OF MARYLAND (REGARDLESS OF THE LAWS THAT MIGHT

BE APPLICABLE UNDER PRINCIPLES OF CONFLICTS OF LAW) AS TO ALL MATTERS (INCLUDING

VALIDITY, CONSTRUCTION, EFFECT, AND PERFORMANCE.)

 

          8.7.  SEVERABILITY.  If the scope of any  provision  contained in this

Agreement  is too  broad to permit  enforcement  of such  provision  to its full

extent, then such provision shall be enforced to the maximum extent permitted by

law, and Employee  hereby  consents  that such scope may be reformed or modified

accordingly,  and enforced as reformed or modified, in any proceeding brought to

enforce such provision.  Subject to the immediately preceding sentence, whenever

possible,  each provision of this Agreement will be interpreted in such a manner

as to be effective and valid under  applicable law, but if any provision of this

Agreement is held to be  prohibited  by or invalid  under  applicable  law, such

provision, to the extent of such prohibition or invalidity,  shall not be deemed

to be a part of this  Agreement,  and shall not invalidate the remainder of such

provision or the remaining provisions of this Agreement.

 

          8.8. ENTIRE AGREEMENT.This  Agreement,  the Non-Qualified Stock Option

Agreement, and the Long Term Incentive Plan constitute the entire agreement, and

supersede all prior  agreements and  understandings,  written or oral, among the

parties with respect to the subject  matter of this  Agreement and the Long Term

Incentive  Plan.  This  Agreement  may not be  amended  or  modified  except  by

agreement  in  writing,  signed by the party  against  whom  enforcement  of any

waiver, amendment, modification, or discharge is sought.

 

          8.9.  INTERPRETATION.  This  Agreement  is being  entered  into  among

competent and experienced business professionals (who have had an opportunity to

consult with  counsel),  and any ambiguous  language in this  Agreement will not

necessarily  be construed  against any  particular  party as the drafter of such

language.

 

          8.10.  CONTINUING  OBLIGATIONS.   The  following  provisions  of  this

Agreement will continue and survive the termination of this  Agreement:  4.2, 5,

6, 7 and 8.

 

          8.11.  TAXES.  SBG may withhold from any payments under this Agreement

all applicable  federal,  state, city, or other taxes required by applicable law

to be so withheld.

 

          8.12.  ARBITRATION  AND  EXTENSION  OF TIME.  Except  as  specifically

provided in Section 6, any dispute or controversy  arising out of or relating to

this

 

                                       12

 

<PAGE>

 

Agreement shall be determined and settled by arbitration in Baltimore,  Maryland

in accordance with the Commercial Rules of the American Arbitration  Association

then in effect,  the Federal  Arbitration  Act, 9 U.S.C.  ss. 1 et seq., and the

Maryland  Uniform  Arbitration  Act, and judgment upon the award rendered by the

arbitrator(s)  may be  entered  in any  court  of  competent  jurisdiction.  The

expenses of the arbitration  shall be borne by the  non-prevailing  party to the

arbitration,  including, but not limited to, the cost of experts,  evidence, and

legal counsel.  Whenever any action is required to be taken under this Agreement

within a specified  period of time and the taking of such  action is  materially

affected by a matter submitted to arbitration,  such period shall  automatically

be  extended  by the  number  of  days,  plus ten (10)  that are  taken  for the

determination  of  that  matter  by  the  arbitrator(s).   Notwithstanding   the

foregoing,  the parties agree to use their best  reasonable  efforts to minimize

the costs and frequency of arbitration hereunder.

 

     THIS AGREEMENT  CONTAINS A WAIVER OF YOUR RIGHT TO A TRIAL BY COURT OR JURY

IN EMPLOYMENT DISPUTES.

 

     THIS  AGREEMENT  CONTAINS  A  BINDING  ARBITRATION  PROVISION  WHICH MAY BE

ENFORCED BY THE PARTIES.

 

                         [SIGNATURES ON FOLLOWING PAGE]

 

                                       13

 

<PAGE>

 

     IN WITNESS  WHEREOF,  the  parties  hereto  have  executed  this  Agreement

effective as of the date first written above.

 

                                            SINCLAIR BROADCAST GROUP, INC.

 

                                            BY:  

 

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

                                                     DAVID D. SMITH, PRESIDENT

 

                                            EMPLOYEE:

 

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

                                                  J. DUNCAN SMITH

 

                                       14