SEPARATION AND DISTRIBUTION AGREEMENT

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EXHIBIT 10.1

SEPARATION AND DISTRIBUTION AGREEMENT

This Separation and Distribution Agreement (this "Agreement") is entered

into as of August 2, 2005, by and between Gray Television, Inc., a Georgia

corporation ("Gray"), and Triple Crown Media, Inc., a Delaware corporation

("TCM"). Capitalized terms used in this Agreement and not otherwise defined

shall have the meanings ascribed to such terms in Section 9.18.

RECITALS

A. Gray owns all of the membership interests of Gray Publishing, LLC, a

Delaware limited liability company ("Gray Publishing").

B. Gray through Gray Publishing operates six regional publications

comprising five daily newspapers and an advertising shopper (the "Newspaper

Publishing Business").

C. Gray Publishing owns all of the membership interests of Graylink, LLC, a

Delaware limited liability company ("Graylink").

D. Graylink is a provider of wireless services, primarily paging services,

in non-major metropolitan areas in Alabama, Florida, and Georgia and also owns

and operates 14 retail locations in Alabama, Florida and Georgia (the "Graylink

Wireless Business").

E. The Board of Directors of Gray has determined that it would be advisable

and in the best interests of Gray and its shareholders for Gray to transfer to

TCM all of the membership interests of Gray Publishing.

F. Gray has agreed to convey, assign and transfer to TCM all of the

membership interests of Gray Publishing (collectively, the "Separation").

G. The Board of Directors of Gray has determined that it would be advisable

and in the best interests of Gray and its shareholders for Gray to distribute on

a pro-rata basis to the holders of record of Gray Class A common stock, no par

value ("Gray Class A Common Stock"), and Gray common stock, no par value ("Gray

Common Stock" and with the Gray Class A Common Stock, the "Gray Stock"), without

any consideration being paid by such holders, all of the outstanding shares of

TCM common stock, par value $.001 per share (the "TCM Common Stock") owned by

Gray (the "Distribution"), and this Agreement has been approved by the Board of

Directors of Gray.

H. In reaching its decision to approve the Separation and Distribution, the

Board of Directors of Gray considered a variety of factors including the

following:

- as a result of the Separation and Distribution, Gray and TCM will be

better able to focus financial and operational resources on its own

business and executing its own strategic plan;

- as a result of the Separation and Distribution, Gray and TCM are expected

to have greater strategic and financial flexibility to support future

growth opportunities;

- each business is in a different stage of development and therefore

attracts different types of investors;

- two separate public companies will enable financial markets to evaluate

Gray and TCM more effectively, which is expected to maximize shareholder

value over the long term for both Gray and TCM;

- the Separation and Distribution will allow Gray and TCM to develop

incentive programs for management and other professionals that are

tailored to its own business and are tied to the market performance of

its own common stock;

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- after the Separation and Distribution, Gray and TCM should have greater

capital planning flexibility and the Newspaper Publishing Business and

Graylink Wireless Business will no longer have to compete with Gray's

television broadcasting business to secure funding for investments; and

- that TCM would possess sufficient scale and business fundamentals to

operate as a stand-alone entity.

I. This Agreement and the Separation and Distribution have been approved by

the special committee of the Board of Directors of TCM.

J. This Agreement and the Separation and Distribution have been approved by

the Board of Directors of TCM, consistent with the approval and recommendation

of the special committee of the Board of Directors of TCM.

K. For U.S. federal income tax purposes, the Separation and Distribution

are intended to qualify as a divisive reorganization described in Sections 355

and 368(a)(1)(D) of the Code.

L. The Board of Directors has determined that conversion price relating to

the Series C preferred stock of Gray should be adjusted upon the consummation of

the Distribution.

M. The parties desire to set forth the principal corporate transactions

required to effect the Separation and the Distribution and certain other

agreements that will govern the relationship of Gray and TCM following the

Distribution.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants

and agreements set forth below, the parties agree as follows:

SECTION 1

SEPARATION

1.1. Transfer of Membership Interests and Assets. Subject to the terms

and conditions of this Agreement, on the Separation Date, Gray shall convey,

assign and transfer to TCM, and TCM shall accept and receive, all right, title,

and interest of Gray in and to the following:

(a) all of the membership interests of Gray Publishing;

(b) all of the contracts, agreements and arrangements listed on

Schedule 1.1(b) (collectively, the "Assigned Contracts"); and

(c) all right, title and interest in or to the improved and unimproved

land listed or described on Schedule 1.1(c), and all buildings, structures,

erections, improvements, appurtenances, and fixtures situated on or forming

part of such land, together with all privileges, easements and

rights-of-way related thereto (the "Assigned Real Property").

1.2. Retained Assets. Immediately prior to the Separation Date, Gray

shall cause Gray Publishing to convey, assign, transfer, contribute, and set

over, or cause to be conveyed, assigned, transferred, contributed, and set over

to Gray the following assets (the "Retained Assets"), and Gray shall assume the

Retained Assets:

(a) Cash. All cash and cash equivalents.

(b) Tax Refunds. Any right, title, or interest in any tax refund,

credit, or benefit to which Gray or any of its Subsidiaries is entitled in

accordance with the terms of this Agreement or of the Tax Sharing

Agreement.

(c) Intercompany Assets. Any right, title, or interest in the

intercompany assets set forth on Schedule 1.2(c).

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(d) Contracts. Gray Publishing's or any of its subsidiaries' rights

under any agreement, commitment or order as to which consent to assignment

is required but has not been obtained, subject to the provisions of Section

6.1(b);

1.3. Assumed Liabilities.

(a) Immediately prior to the Separation Date, Gray shall cause Gray

Publishing, to convey, assign, transfer, contribute, and set over, or cause to

be conveyed, assigned, transferred, contributed, and set over to Gray the

following liabilities (the "Assumed Liabilities"), and Gray shall assume the

Assumed Liabilities:

(i) Taxes. Any liability or obligation of Gray Publishing or

Graylink, as applicable to pay taxes, as set forth in the Tax Sharing

Agreement.

(ii) Intercompany Debt. Any liability or obligation of Gray

Publishing or Graylink, as applicable, in respect of the intercompany debt

set forth on Schedule 1.2(c).

(b) Subject to the terms and conditions of this Agreement, TCM shall

assume, on the Separation Date, and pay, comply with, and discharge all

contractual and other liabilities of Gray arising out of or relating to the

Assigned Contracts and Assigned Real Property (all of such liabilities being

hereinafter referred to as the "TCM Assumed Liabilities").

1.4. Termination of Existing Intercompany Agreements. Except as otherwise

contemplated by this Agreement, all agreements between Gray or its Subsidiaries

on one hand and Gray Publishing or its subsidiaries on the other hand relating

primarily to the Newspaper Publishing Business and Graylink Wireless Business,

whether or not in writing and whether or not binding, in effect immediately

prior to the Distribution Date, shall be terminated and be of no further force

and effect from and after the Distribution Date.

SECTION 2

SEPARATION CLOSING MATTERS

2.1. Separation Date. The effective time and date of the conveyance,

assignment, and transfer of the membership interests of Gray Publishing in

connection with the Separation shall be such date and time as shall be fixed by

the Board of Directors of Gray (the "Separation Date").

2.2. Closing of Transactions. The closing of the transactions

contemplated by this Agreement shall take place at the offices of Proskauer Rose

LLP, 1585 Broadway, New York, New York 10036.

2.3. Documents to be Delivered by Gray. On the Separation Date, Gray will

deliver, or will cause its appropriate Subsidiaries to deliver, to TCM all of

the following items and agreements (collectively, together with all agreements

and documents contemplated by such agreements, the "Ancillary Agreements"):

(a) Secretary's Certificate. A certificate executed by the Secretary

of Gray substantially in the form attached to this Agreement as Exhibit A;

(b) Assignment and Assumption Agreement. A duly executed Assignment

and Assumption Agreement substantially in the form attached hereto as

Exhibit B (the "Assignment and Assumption Agreement");

(c) Tax Sharing Agreement. A duly executed Tax Sharing Agreement

substantially in the form attached hereto as Exhibit C (the "Tax Sharing

Agreement");

(d) Real Property Lease. A duly executed Real Property lease

Agreement substantially in the form attached hereto as Exhibit D (the "Real

Property Lease");

(e) Contribution Agreement. A duly executed contribution Agreement

substantially in the form attached to this Agreement as Exhibit E (the

"Contribution Agreement");

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(f) Officer Resignations. Resignations of each person who is an

officer of Gray Publishing, Graylink or any of their respective

subsidiaries, immediately prior to the Separation Date, and who will not be

an employee of TCM from and after the Separation Date; and

(g) Other Agreements. Such other agreements, documents, or

instruments as the parties may agree are necessary or desirable in order to

achieve the purposes hereof, including, without limitation, those documents

referred to in Section 6.1.

2.4. Documents to be Delivered by TCM. On the Separation Date, TCM will

deliver, or will cause its appropriate Subsidiaries to deliver, to Gray all of

the following items and agreements:

(a) Secretary's Certificate. A certificate executed by the Secretary

of TCM substantially in the form attached to this Agreement as Exhibit F;

(b) Assignment and Assumption Agreement. A duly executed Assignment

and Assumption Agreement;

(c) Tax Sharing Agreement. A duly executed Tax Sharing Agreement;

(d) Real Property Lease. A duly executed Real Property Lease;

(e) Contribution Agreement. A duly executed Contribution Agreement;

and

(f) Other Agreements. Such other agreements, documents, or

instruments as the parties may agree are necessary or desirable in order to

achieve the purposes hereof, including, without limitation, those documents

referred to in Section 6.1.

2.5. Approvals and Required Consents. To the extent that the Separation

requires any Governmental Approvals or other consents, the parties will use

their commercially reasonable efforts to obtain any such Governmental Approvals

or consents.

SECTION 3

THE DISTRIBUTION

3.1. Share Distribution.

(a) Delivery of Shares for Distribution. Prior to the Distribution Date,

Gray shall deliver to TCM the certificate for 100 shares of TCM Common Stock

held by Gray and representing all of the outstanding TCM Common Stock, and TCM

shall cancel such certificate and issue and deliver to Gray in exchange therefor

an omnibus stock certificate representing that number of shares of TCM Common

Stock equal to the total number of shares distributable pursuant to Section

3.1(b). Gray shall then deliver such omnibus certificate to the Distribution

Agent.

(b) Distribution of Shares. Gray shall instruct the Distribution Agent to

distribute, beginning on the Distribution Date, to holders of Gray Stock on the

Record Date, the number of shares of TCM Common Stock equal to the number of

shares of Gray Stock owned by such holder on the Distribution Date, multiplied

by 0.10, and as soon thereafter as reasonably practicable, cash, if applicable,

in lieu of fractional shares of TCM Common Stock obtained in the manner provided

in Section 3.1(c) hereof. TCM agrees to provide to the Distribution Agent

sufficient certificates in such denominations as the Distribution Agent may

request in order to effect the Distribution. All of the shares of TCM Common

Stock issued in the Distribution shall be fully paid, nonassessable, and free of

preemptive rights. Gray shareholders shall not be required to pay cash or other

consideration for the TCM Common Stock received in the Distribution.

(c) Fractional Shares. No certificate or scrip representing fractional

shares of TCM Common Stock shall be issued as part of the Distribution. In lieu

of receiving fractional shares, each holder of Gray Stock who would otherwise be

entitled to receive a fractional share of TCM Common Stock pursuant to the

Distribution will receive cash for such fractional share. Gray shall instruct

the Distribution Agent to determine the number of whole shares and fractional

shares of TCM Common Stock allocable to each

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holder of record or beneficial owner of Gray Stock on the Distribution Date, to

aggregate all such fractional shares into whole shares, to sell the whole shares

obtained thereby in the open market at then prevailing prices on behalf of

holders of record or beneficial owners who otherwise would be entitled to

receive fractional shares of TCM Common Stock, and to distribute to each such

holder or for the benefit of each such beneficial owner such holder's or owner's

ratable share of the total proceeds (net of total selling expenses) of such

sale; provided, however, that the Distribution Agent shall have sole discretion

to determine when, how, through which broker-dealer, and at what price to make

its sales; provided, further, that the broker-dealer shall not be an affiliate

of Gray or TCM.

(d) Obligation to Provide Information. Gray and TCM, as the case may be,

will provide to the Distribution Agent all share certificates and any

information required in order to complete the Distribution on the basis

specified in Section 3.1.

3.2. Actions Prior to the Distribution. On or before the Distribution

Date, Gray and TCM shall use their commercially reasonable efforts to do and

accomplish the following:

(a) SEC Filings. Gray and TCM shall prepare, and Gray shall mail,

prior to the Distribution Date, to the holders of Gray Common Stock, a

proxy statement/prospectus/information statement containing such

information concerning TCM, the Newspaper Publishing Business and Graylink

Wireless Business and the Separation and the Distribution and such other

matters as Gray and TCM shall reasonably determine are necessary and as may

be required by law. Gray and TCM shall prepare, and TCM shall file with the

Securities and Exchange Commission (the "SEC") a registration statement on

Form S-4 to register the shares of TCM Common Stock to be issued in the

Distribution under the Securities Act. Gray and TCM shall use all

commercially reasonable efforts to respond to any comments of the SEC and

to cause such registration statement to be declared effective under the

Securities Act as promptly as practicable after such registration statement

is filed with the SEC. TCM shall prepare and file with the SEC a

registration statement on Form 8-A to register the shares of TCM Common

Stock under the Exchange Act.

(b) Blue Sky. Gray and TCM shall take and shall cause any of their

Subsidiaries to take all such actions as may be necessary or appropriate

under the securities or blue sky laws of any applicable states in

connection with the Distribution.

(c) Nasdaq National Market. TCM shall prepare and file, and shall use

its commercially reasonable efforts to have approved, an application for

listing of the TCM Common Stock to be issued in the Distribution on the

Nasdaq National Market, subject to official notice of issuance.

(d) Advisors. Gray and TCM shall participate in the preparation of

materials and presentations as their respective advisors shall deem

necessary or desirable.

(e) Satisfaction of Conditions. Gray and TCM shall take and shall

cause all of their respective Subsidiaries to take all reasonable steps

necessary and appropriate to cause the conditions set forth in Section 3.3

to be satisfied and to effect the Distribution on the Distribution Date.

(f) Termination of Letter Agreement. Gray and TCM shall use their

commercially reasonable efforts to cause the Letter Agreement, dated July

20, 2004, by and between Gray Television, Inc. and Thomas Stultz to be

terminated.

3.3. Conditions to Distribution. The following are conditions to the

consummation of the Distribution. The conditions are for the sole benefit of

Gray and can be waived by Gray, but shall not give rise to or create any duty on

the part of Gray or the Board of Directors of Gray to waive or not waive any

such condition or in any way limit Gray's right to terminate this Agreement.

(a) Filing and Effectiveness of Registration Statement; No Stop Order. A

registration statement on Form S-4 and Form 8-A covering the TCM Common Stock to

be issued in the Distribution shall have been filed with the SEC and shall be

effective, and no stop order suspending the effectiveness of such registration

statements shall have been initiated or, to the knowledge of either TCM or Gray,

threatened by the SEC.

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(b) Dissemination of Information to Gray Shareholders. Prior to the

Distribution Date, the parties shall have prepared, and Gray shall have mailed

to the holders of Gray Stock a proxy statement/ prospectus/information statement

containing such information concerning TCM, the Newspaper Publishing Business

and Graylink Wireless Business and, the Separation and the Distribution, and

such other matters as Gray and TCM shall reasonably determine are necessary and

as may be required by law.

(c) Nasdaq National Market. The shares of TCM Common Stock to be issued in

the Distribution shall have been authorized for listing on the Nasdaq National

Market, upon official notice of issuance.

(d) Compliance with State and Foreign Securities and Blue Sky Laws. Gray

and TCM shall have taken all such action as may be necessary or appropriate

under state and foreign securities and blue sky laws in connection with the

Distribution.

(e) Consents.

(i) Governmental Approvals. Any material governmental approvals and

consents required to permit the valid consummation of the Distribution

shall have been obtained without any conditions being imposed that would

have a Material Adverse Effect on Gray or TCM.

(ii) Consents. Gray shall have obtained the consent, approval, or

waiver of each Person set forth on Schedule 3.3(e)(ii).

(f) No Actions. No Actions shall have been instituted or threatened by or

before any Governmental Authority to restrain, enjoin, or otherwise prevent the

Distribution or the other transactions contemplated by this Agreement, and no

order, injunction, judgment, ruling, or decree issued by any Governmental

Authority of competent jurisdiction shall be in effect restraining the

Distribution or such other transactions.

(g) Tax Opinion regarding the Separation and Distribution. Gray and Bull

Run shall have received an opinion of King & Spalding LLP, special tax counsel

to Gray, to the effect that the Separation and Distribution will qualify as a

divisive reorganization described in Sections 368(a)(1)(D) and 355 of the Code.

(h) Consummation of Separation. The Separation transactions contemplated

by this Agreement shall have been consummated in all material respects.

(i) Approval by the Special Committee of the Board of Directors of Gray of

the Merger Agreement and the Merger. The Merger Agreement and the Merger shall

have been approved by the special committee of the Board of Directors of Gray in

accordance with applicable law and the articles of incorporation and bylaws of

Gray.

(j) Approval by the Board of Directors of Gray of the Merger Agreement and

the Merger. The Merger Agreement and the Merger shall have been approved by the

Board of Directors of Gray, consistent with the approval and recommendation of

the special committee of the Board of Directors of Gray, and in accordance with

applicable law and the articles of incorporation and bylaws of Gray.

(k) Approval by the Special Committee of the Board of Directors of TCM of

the Merger Agreement and the Merger. The Merger Agreement and the Merger shall

have been approved by the special committee of the Board of Directors of TCM in

accordance with applicable law and the certificate of incorporation and bylaws

of TCM.

(l) Approval by the Board of Directors of TCM of the Merger Agreement and

the Merger. The Merger Agreement and the Merger shall have been approved by the

Board of Directors of TCM, consistent with the approval and recommendation of

the special committee of the Board of Directors of TCM, and in accordance with

applicable law and the certificate of incorporation and bylaws of TCM.

(m) Approval by the Special Committee of the Board of Directors of Bull Run

of the Merger Agreement and the Merger. The Merger Agreement and the Merger

shall have been approved by the

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special committee of the Board of Directors of Bull Run in accordance with

applicable law and the articles of incorporation and bylaws of Bull Run.

(n) Approval by the Board of Directors of Bull Run of the Merger Agreement

and the Merger. The Merger Agreement and the Merger shall have been approved by

the Board of Directors of Bull Run, consistent with the approval and

recommendation of the special committee of the Board of Directors of Bull Run,

and in accordance with applicable law and the articles of incorporation and

bylaws of Bull Run.

(o) Approval by the Shareholders of Bull Run of the Merger Agreement and

the Merger. The shareholders of Bull Run shall have approved the Merger

Agreement and the Merger in accordance with applicable law and the articles of

incorporation and bylaws of Bull Run.

(p) Opinion of Financial Advisor to the Special Committee of the Board of

Directors of TCM. Each of the Boards of Directors of Gray and TCM and the

special committees of the Boards of Directors of Gray and TCM shall have

received the opinion of Houlihan Lokey Howard & Zukin Capital, Inc., the

financial advisor of the special committee of the Board of Directors of TCM, to

the effect that as of the date of such opinion, based upon and subject to the

assumptions and limitations set forth in such opinion, (A) the Distribution is

fair, from a financial point of view, to the holders (other than J. Mack

Robinson or any of his affiliates) of the Gray Class A Common Stock and the Gray

Common Stock that receive TCM Common Stock in the Distribution, (B) the

allocation of the consideration in the Distribution between the Gray Common

Stock and the Gray Class A Common Stock is fair, from a financial point of view,

to the holders (other than J. Mack Robinson or any of his affiliates) of each

such class of common stock and (C) the consideration to be paid to the

shareholders of Bull Run in the Merger is fair, from a financial point of view,

to TCM.

(q) Opinion of a Nationally Recognized Independent Valuation Firm. Each of

the Boards of Directors of Gray and TCM and the special committee of the Boards

of Directors of Gray and TCM shall have received the opinion of a nationally

recognized independent valuation firm that, as of the date of such opinion,

based upon and subject to the assumptions, factors and limitations set forth in

such opinion, assuming the Transaction and Refinancing have been consummated as

proposed, immediately after giving effect to the Transaction and the

Refinancing, and on a pro forma basis: (A) the fair value and present saleable

value of TCM's assets would exceed TCM's stated liabilities and identified

contingent liabilities, (B) TCM should be able to pay its debts as they become

absolute and mature and (C) the capital remaining in TCM would not be

unreasonably small for the business in which TCM is engaged, as management has

indicated it is proposed to be conducted following the consummation of the

Transaction and the Refinancing.

(r) Opinion of Financial Advisor to the Special Committee of the Board of

Directors of Bull Run. The Board of Directors of Bull Run and the special

committee of the Board of Directors of Bull Run shall have received the written

opinion of SunTrust Robinson Humphrey that, as of the date of such opinion and

based upon and subject to certain matters stated therein, the exchange ratio to

be received by the common stockholders (other than J. Mack Robinson, the

majority stockholder, and other affiliated stockholders) of Bull Run is fair,

from a financial point of view, to such holders.

(s) Tax Opinion rendered to TCM regarding the Merger. TCM shall have

received an opinion of King & Spalding LLP, special tax counsel to TCM, to the

effect that the Merger will qualify as a reorganization under Section 368(a) of

the Code.

(t) Tax Opinion rendered to Bull Run regarding the Merger. Bull Run shall

have received an opinion of Troutman Sanders LLP, special tax counsel to Bull

Run, to the effect that the Merger will qualify as a reorganization under

Section 368(a) of the Code.

(u) Other Events. No other events or developments shall have occurred

subsequent to the date of this Agreement that, in the judgment of the Board of

Directors of Gray or the special committee of the Board of Directors of Gray,

would result in the Distribution having a Material Adverse Effect on Gray or a

material adverse effect on the shareholders of Gray.

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3.4. Modification. Gray shall, in its sole and absolute discretion,

determine the date of the consummation of the Distribution. In addition, at any

time and from time to time until the completion of the Distribution, Gray with

the consent of the special committee of the Board of Directors of TCM may modify

or change the terms of the Distribution.

SECTION 4

EMPLOYEES AND EMPLOYEE BENEFIT MATTERS

4.1. Employees. Immediately prior to, and subject to the Separation, Gray

shall transfer to TCM each employee of the Newspaper Publishing Business and

Graylink Wireless Business (the "Transferred Employees") so that no such

employee who becomes employed by TCM experiences any termination or other

interruption in employment and Gray shall cause all such Transferred Employees

to resign from all positions as officers or employees of Gray and its

Subsidiaries. Except as otherwise provided herein, TCM shall be liable for all

obligations relating to all Transferred Employees for all periods, whether

arising prior to, on or after the Separation Date. All employees of Gray and its

Subsidiaries as of the Separation Date who are not Transferred Employees shall

be retained by Gray and its Subsidiaries (the "Retained Employees") and Gray

shall be liable for all obligations relating to all Retained Employees for all

periods, whether arising prior to, on or after the Separation Date. TCM and Gray

(and their respective Subsidiaries) shall use commercially reasonable efforts to

accomplish any transfers of employment required by this Section 4.1 in a timely

manner.

4.2. Prior Service Credit. TCM shall give each Transferred Employee

credit for years of service with Gray or its Subsidiaries as if they were years

of service with TCM. TCM shall recognize such service for purposes of satisfying

any waiting period, evidence of insurability requirements or the application of

any preexisting condition limitation. TCM shall also give Transferred Employees

credit for amounts paid under a corresponding Gray plan during the same period

for purposes of applying deductibles, copayments and out-of-pocket maximums as

though such amounts had been paid in accordance with the terms and conditions of

the benefit plan sponsored or maintained by TCM.

4.3. 401(k) Plan. Immediately prior to, and subject to, the Separation,

Gray shall cause a "spin off" of the assets and liabilities of the Gray

Television, Inc. Capital Accumulation Plan (the "Gray 401(k) Plan") resulting in

the division of the Gray 401(k) Plan into two separate, identical, component

plans and trusts, in accordance with applicable law (including, without

limitation, Section 414(l) of the Code), covering, respectively, (i) the

Transferred Employees (and their beneficiaries) (the "TCM 401(k) Plan") and (ii)

all other Gray 401(k) Plan participants (and their beneficiaries). Immediately

prior to, and subject to, the Separation, Gray shall cause the TCM 401(k) Plan

to be transferred to TCM but shall retain the Gray 401(k) Plan. Prior to the

Separation, Gray shall draft the appropriate documents and use its commercially

reasonable efforts to take all actions necessary, to the extent possible, to

effectuate the intent of this Section 4.3.

4.4. Pension Plan. Gray shall retain all liabilities and obligations in

respect of benefits accrued by Transferred Employees who participate in the Gray

Communications Systems, Inc. Retirement Plan (the "Retirement Plan"). Benefit

accruals in respect of Transferred Employees shall cease as of the Separation

Date and the Transferred Employees participating therein shall be considered to

have terminated employment for purposes of such plan. Gray shall fully vest the

accrued benefits of the Transferred Employees under the Retirement Plan as of

the Separation Date. No assets under the Retirement Plan shall be transferred to

TCM or to any plan of TCM.

4.5. Welfare Plans

(a) Except as otherwise provided herein, immediately prior to, and subject

to, the Separation, Gray shall cause all of Gray's employee welfare benefit

plans, as defined in Section 3(1) of ERISA (the "Gray Welfare Plans"), to be

divided into separate, identical component plans covering, respectively, (i) the

Transferred Employees (and their beneficiaries) (the "TCM Welfare Plans") and

(ii) all other Gray Welfare Plan participants (and their beneficiaries),

including without limitation, participants (and their

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beneficiaries) who experienced a "qualifying event" for purposes of the group

health plan continuation coverage requirements of Section 4980 of the Code and

Title I, Subtitle B of ERISA prior to the Separation Date regardless of when an

election for continuation coverage is made by the participant. Immediately prior

to and subject to, the Separation, Gray shall cause the TCM Welfare Plans to be

transferred to TCM but shall retain the Gray Welfare Plans. Prior to the

Separation, Gray shall draft the appropriate documents and use its reasonable

best efforts to take all actions necessary, to the extent possible, to

effectuate the intent of this Section 4.5(a).

(b) On and after the Separation Date, TCM shall pay, or cause to be paid,

all claims for health care benefits by the Transferred Employees (and their

beneficiaries), made after the Separation Date for post-Separation periods, and

shall pay, or cause to be paid, all claims for health care benefits by the

Transferred Employees (and their beneficiaries), made after the Separation for

all periods prior to the Separation Date.

(c) TCM shall be responsible for any liabilities or obligations for

severance obligations relating to employees of the Newspaper Publishing Business

and Graylink Wireless Business whose employment terminates prior to, or on or

after the Separation Date.

(d) Any Transferred Employee on short-term disability as of the Closing

Date that would have become eligible for long-term disability benefits under the

Gray Welfare Plans but for the consummation of the transactions contemplated by

this Agreement shall be covered by the Gray Welfare Plan that provides long-term

disability benefits and TCM shall have no obligation to provide such coverage.

4.6. Section 125 Plan. Without limiting the generality of Section 4.5,

immediately prior to, and subject to, the Separation, Gray shall cause a "spin

off" of the assets and liabilities of the Gray Section 125 Plan (the "Gray Flex

Plan") (which contains premium, dependent care and medical health reimbursement

component parts) resulting in the division of the Gray Flex Plan into two,

separate, identical, component plans, in accordance with applicable law,

covering, respectively, (i) the Transferred Employees (and their beneficiaries)

(the "TCM Flex Plan") and (ii) all other Gray Flex Plan participants (and their

beneficiaries). Immediately prior to and subject to, the Separation, Gray shall

cause the TCM Flex Plan to be transferred to TCM but shall retain the Gray Flex

Plan. Prior to the Separation, Gray shall draft the appropriate documents and

use its reasonable best efforts to take all actions necessary, to the extent

possible, to effectuate the intent of this Section 4.6.

4.7. Accrued Vacation. Gray and TCM agree that all accrued vacation for

Transferred Employees as of the Separation Date shall be TCM's obligation.

4.8. Stock Option Plan. Immediately prior to, and subject to, the

Distribution, Gray shall cause each outstanding nonqualified option to purchase

shares of Gray Common Stock that was granted under the Gray 2002 Long Term

Incentive Plan on or before the Distribution Date to a Transferred Employee to

be become fully vested on the Distribution Date, and to continue to be

exercisable until the original expiration date. Prior to the Separation, Gray

shall prepare the appropriate documents and use its reasonable best efforts to

take all actions necessary, to the extent possible, to effectuate the intent of

this Section 4.8.

4.9. Workers' Compensation. TCM shall assume the liability for any

workers' compensation or similar workers' protection claims with respect to any

employee of the Newspaper Publishing Business and Graylink Wireless Business,

whether incurred prior to, on, or after the Distribution Date, which are the

result of an injury or illness originating prior to or on the Distribution Date.

4.10. WARN Act. TCM and its Subsidiaries agree that they shall not, at

any time during the 90-day period following the Distribution Date, (i)

effectuate a "plant closing" as defined in the Worker Adjustment and Retraining

Notification Act of 1988 (the "WARN Act") affecting any site of employment or

operating units within any site of employment of the Newspaper Publishing

Business and Graylink Wireless Business, or (ii) take any action to precipitate

a "mass layoff" as defined in the WARN Act affecting any site of employment of

the Newspaper Publishing Business and Graylink Wireless Business, except, in

either case, after complying fully with the notice and other requirements of

9

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the WARN Act. TCM agrees to indemnify Gray and its Subsidiaries and their

respective officers and directors and to defend and hold harmless Gray and its

Subsidiaries and their respective officers and directors from and against any

and all claims, losses, damages, expenses, obligations and liabilities

(including attorney's fees and other costs of defense) that Gray and its

Subsidiaries and their respective officers and directors may incur in connection

with any suit or claim of violation brought again