December 16, 2005

Belo Technologies Out-Tasking Q&A: Response to Additional Questions

WHAT ELSE HAS TO BE DONE OR ANALYZED BEFORE FINAL DECISIONS ARE MADE ABOUT TECHNOLOGY JOBS AT BELO AND OUT-TASKING? WHAT WILL BE ANNOUNCED IN JANUARY?

We have been conducting service description workshops with Belo IT leaders at our publishing, corporate and interactive media organizations. This is helping us create a very detailed allocation of responsibilities between Belo and the out-tasking company, which will be included in our contract with them. We are also finalizing performance standards for different tasks to go into the service level agreement. Legal is working on drafting a contract with IBM, or another supplier if negotiations with IBM do not deliver the value we are seeking. We also are asking the local IT groups to confirm their server and application inventory. HR is working with us on the organizational structure and job descriptions for the new positions at Belo to manage the out-tasking relationship and support the functional areas that are being consolidated internally.

In mid-January 2006, we will announce Belo Technologies' organizational structure. By late January, we expect to begin posting the new positions that will be available at Belo and conducting interviews. The out-tasking company will start interviews after we have completed Belo's interviewing process. No jobs will be eliminated during the first half of the year.


IF OFFERED A JOB AT ANOTHER BELO LOCATION, WILL WE BE REQUIRED TO GO? IF WE DECLINE, WILL WE STILL BE ELIGIBLE FOR SEVERANCE PAY?

Positions will not be transferred from one location to another. Open positions will be posted and will indicate where each position is located. If an employee applies for and is offered a job at another location, turning that offer down will make the employee ineligible for severance pay if the job and salary offered are comparable.


IF WE REQUEST A TRANSFER TO ANOTHER DEPARTMENT TO PRE-EMPT A JOB LOSS, WILL WE BE ELIGIBLE FOR SEVERANCE IN THE AMOUNT OF THE DIFFERENCE IN PAY RATE, ASSUMING THAT THE PAY RATE OF THE NEW JOB IS LOWER THAN THE CURRENT JOB WE HOLD?

Employees continuing employment with a Belo company will not be eligible for severance.


IF AN EMPLOYEE LOSES HIS OR HER JOB AND IS LATER HIRED BACK BY BELO, WILL THE PERSON GET TO KEEP HIS OR HER SENIORITY?

Anyone hired back under these circumstances within six months will have seniority restored.


WILL WE BE REQUIRED TO PAY BACK BOTH THE PORTION OF THE SEVERANCE PAY AND THE STAYING BONUS IF WE ARE HIRED BACK? HOW ABOUT IF WE ARE OFFERED A POSITION WITH THE OUT-TASKING COMPANY, WILL THE SAME THING APPLY?

This question was also asked during the last conference call; at that time we stated that we'd re-examine the policy.

Persons re-hired will only have to pay back a pro-rated portion of the severance payment. There will not be a pay-back requirement for the transition period bonus if this situation occurs.

Similarly, if a person is offered a position with the out-tasking company, turns it down but works through the established transition period, that person is still eligible to receive the transition bonus. Here's that portion of the policy as it has been clarified:


If a person is rehired at a Belo company after receiving severance and transition bonus payments, a pro-rated portion of the severance payment amount will be payable to the Company upon rehire. This amount will be equal to the difference between the severance amount paid and the base compensation that would have been paid had the period of unemployment not occurred. Also, if a person is offered a position by the third party out-tasking vendor that is comparable in scope and pay with the employee's current job, no severance will be paid. The transition bonus will be paid should the individual work through the established transition period.


WHAT WILL BE THE REPORTING RELATIONSHIP OF A PERSON WHO IS HIRED BY THE OUT-TASKING COMPANY? WILL IT BE WITH A DOTTED LINE TO BELO CORPORATE OR THE OPERATING COMPANY WHERE THE EMPLOYEE IS LOCATED?

Any employee hired by the out-tasking partner will report to that third party vendor.

WILL THE PERSON HIRED TO WORK FOR THE OUT-TASKING COMPANY BE AN ACTUAL EMPLOYEE WITH THEM OR A CONTRACT EMPLOYEE WITH THEM? WILL THEY (CONTRACT OR REGULAR) BE ELIGIBLE FOR BENEFITS?

Individuals hired by the out-tasking company will be employees of that company who are eligible for that company's benefits.


HOW WILL THE OUT-TASKING COMPANY KNOW OUR SKILLS AND WHAT WE ARE CAPABLE OF DOING? HOW WILL THEY DETERMINE THE LOCATION WHERE WE WILL BE ASSIGNED, IF HIRED?

The out-tasking company will determine staffing levels necessary to meet Belo's service level agreements with them. They will then interview and select candidates for those positions to best provide those services to Belo as their client.


ARE WE GOING TO BE ALLOWED TO APPLY TO THE OUT-TASKING COMPANY, OR WILL WE JUST BE SELECTED AND REQUIRED TO GO? IF WE ARE OFFERED A POSITION AND DECLINE, WILL WE STILL BE ELIGIBLE FOR THE SEVERANCE?

The employment process with the out-tasking company will involve interviewing with that company. Anyone receiving an offer for a comparable job will not be eligible for severance pay.


CAN YOU TELL US WHEN AN ANTICIPATED START DATE WITH THE OUT-TASKING COMPANY MIGHT BE?

We anticipate that once a final agreement is reached with the out-tasking company, the actual employment dates for those who have accepted positions will be no earlier than the second half of 2006. Details such as these may change as we finalize the out-tasking arrangement. If they do and as more specifics are known, you will be informed.


WHAT PERCENTAGE OF STAFF HIRED BY THE OUT-TASKING STAFF WILL BE ALLOCATED ELSEWHERE? WHAT IS THE SCOPE OF COMMUTE DISTANCE TO OTHER SITES THAT THE OUT-TASKING COMPANY WILL CONSIDER REASONABLE?

We anticipate that nearly all jobs filled by the out-tasking firm will be serving the Belo facility where that function is performed today.

WILL THE OUT-TASKING COMPANY RECOGNIZE YEARS OF SERVICE WITH BELO?

This is a topic that has come up in our discussions with IBM. If selected as the out-tasking partner, IBM will recognize individuals' prior continuous service with Belo (this will also include prior continuous service with a Belo operating company prior to Belo's acquisition of that company). Prior service will count toward benefit eligibility, including paid time-off benefits.


IF IBM IS THE OUT-TASKING PARTNER, WHAT KIND OF BENEFITS WILL THEY OFFER TO BELO EMPLOYEES THEY HIRE?

Should IBM become the out-tasking partner, individuals they hire will be immediately eligible for their 401(k) plan which matches dollar for dollar up to the first 6% of salary deferred by the participant. Prior Belo service will count toward any eligibility period or vesting requirement they may have. Like Belo, new employees are not eligible for a defined benefit pension plan.

Prior Belo service will also count toward any other benefit plan eligibility requirement, including vacation. Their vacation plan provides 3 weeks of vacation for service up to 10 years and 4 weeks for service of 10 or more years. IBM also offers 12 paid holidays per year.

Medical, dental and vision plans are very similar to those that Belo offers both in plan design and cost.


WILL THERE BE ANY LENGTH OF SERVICE GUARANTEE WITH THE OUT-TASKING COMPANY; WHAT HAPPENS IF THEY HAVE A LAY-OFF?

The employment relationship is the responsibility of the out-tasking company. However, we do not anticipate the out-tasking partner either providing length of employment guarantees or having a lay-off.


IF I RECEIVE AN OFFER FROM THE OUT-TASKING COMPANY AT A LOWER RATE, WILL SEVERANCE BE PAID?

An offer that is not comparable in pay or scope of job duties will not make you ineligible for the severance pay. Each offer will be reviewed individually to determine what is or is not comparable.

Realistically, we don't anticipate employees being offered positions that are not comparable, in scope and pay, with their current positions at Belo. We anticipate salary offers to be comparable to those being paid to Belo employees today doing comparable work.


IS THE TRANSITIONAL BONUS PRE-TAX?

No, the transition bonus is regular income and is required to be taxed accordingly.


WILL WE HAVE INFORMATION AHEAD OF TIME SO THAT WE CAN USE EMPLOYEE SELF-SERVICE (ESS) TO ADJUST OUR TAXES BEFORE THE SEVERANCE AND STAYING BONUS PAY IS PAID OUT?

Severance payments are considered taxable income to the person receiving the payment and are required by the IRS to have a set withholding rate of 25%.


WHEN WILL THE RELEASE AGREEMENT BE READY FOR REVIEW?

Any separation agreement will be provided to the individual at the time of separation from employment.


HOW LONG WILL BENEFITS REMAIN IN EFFECT AFTER SEPARATION?

Benefits, health and life, will remain in effect until the end of the month of separation. After that, benefit elections can be made through COBRA to extend benefits for up to 18 months.


WHERE CAN I GO FOR ADDITIONAL INFORMATION?

Talk to your supervisor, department head or human resources, or send an e-mail to techopt@belo.com . Available information and responses to all questions received will also be posted in the Technology Optimization site under the Belo Technologies Department listing on Belo's Intranet.