The Hearst Corp. said it will not make a final $1 million payment this year to The Seattle Times Co. The New York-based company has been...

The Hearst Corp. said it will not make a final $1 million payment this year to The Seattle Times Co.

The New York-based company has been paying the Blethen family, the principal owner of The Times, $1 million a year since 1999 for the first right to purchase The Times, but Hearst’s failure to pay this year means the provision is now terminated.

In a letter to the Committee for a Two-Newspaper Town, Hearst also said that if its Seattle Post-Intelligencer becomes an Internet-only operation, it will do so outside the joint-operating agreement that governs the relationship between The Times and P-I.

Hearst said it has not yet decided whether to turn the P-I, Seattle’s oldest daily newspaper, into an Internet-only operation.

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In the letter to the Committee for a Two-Newspaper Town, a group devoted to keeping the P-I alive, Hearst said it’s still reviewing its options.

The company announced last month that it was putting the P-I up for sale and if no buyer emerged, the paper would likely be shut down or left as a news Web site with a greatly reduced staff.

Meanwhile, The Times Co. said in a memo to its staff today that the company is in “survival mode.” It is asking each employee group to help the newspaper save the equivalent of 12 percent of pay and benefits.