LOCAL PROGRAMMING AND MARKETING AGREEMENT

THIS LOCAL PROGRAMMING AND MARKETING AGREEMENT (this “Agreement”) is made as of
May 8, 2017 between Emmis Radio License, LLC (“Licensee”) and KWHY-22
Broadcasting, LLC (“Programmer”).
Recitals
A.    Licensee owns and operates the following radio station (the “Station”)
pursuant to licenses issued by the Federal Communications Commission (“FCC”):
KPWR(FM), Los Angeles, California

B.    Licensee desires to obtain programming for the Station, and Programmer
desires to provide programming for broadcast on the Station on the terms set
forth in this Agreement.

C.    Licensee and an affiliate (as Seller) and Programmer (as Buyer) are
parties to an Asset Purchase Agreement (the “Purchase Agreement”) of even date
herewith with respect to the Station.

Agreement
NOW, THEREFORE, taking the foregoing recitals into account, and in consideration
of the mutual covenants and agreements contained herein and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, hereby agree as
follows:
1.    Term. The term of this Agreement (the “Term”) will begin on a date
mutually acceptable to Licensee and Programmer within five (5) business days
after the date of HSR Clearance (as defined in the Purchase Agreement), and will
continue until the date one (1) year after the date of this Agreement, unless
earlier terminated in accordance with the terms of this Agreement (or extended
by mutual written agreement).
2.    Programming. During the Term, Programmer shall purchase from Licensee
airtime on the Station for the price and on the terms specified below, and shall
transmit to Licensee programming that it produces or owns (the “Program” or
“Programs”) for broadcast on the Station twenty-four (24) hours per day, seven
(7) days per week, excluding the period from 6:00 a.m. to 8:00 a.m. each Sunday
morning (the “Broadcasting Period”). Programmer will transmit, at its own cost,
its Programs to the Station’s transmitting facilities in a manner that ensures
that the Programs meet technical and quality standards at least equal to those
of the Station’s broadcasts prior to commencement of the Term. Notwithstanding
anything herein to the contrary, the Station shall continue to broadcast any
programming required to be aired under the terms of the Station Contracts (as
defined in the Purchase Agreement).
3.    Broadcasting. In return for the payments to be made by Programmer
hereunder, during the Term, Licensee shall broadcast the Programs, subject to
the provisions of Section 6

 
- 1 -

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

below. To the extent reasonably necessary to perform this Agreement, during the
Term, Licensee shall provide Programmer with the benefits of any Station
Contracts and Programmer shall perform the obligations of Licensee thereunder.
4.    Advertising. Licensee shall retain all of the Station’s accounts
receivable existing on the date of this Agreement. During the Term, Programmer
will be exclusively responsible for the sale of advertising on the Station and
for the collection of accounts receivable arising therefrom, and Programmer
shall be entitled to all such collections. All contracts for advertising on the
Station which may be entered into by Programmer shall terminate upon the
termination of this Agreement (other than a termination at closing under the
Purchase Agreement).
5.    Payments. For the broadcast of the Programs and the other benefits made
available to Programmer pursuant to this Agreement, during the Term, Programmer
will pay Licensee as set forth on Schedule A attached hereto.
6.    Control. Notwithstanding anything to the contrary in this Agreement,
Licensee shall have full authority, power and control over the operation of the
Station and over all persons working at the Station during the Term. Without
limiting the generality of the foregoing, Licensee will: (1) employ a manager
for the Station, who will report to Licensee and will direct the day-to-day
operations of the Station, and who shall have no employment, consulting, or
other relationship with Programmer, (2) employ a second employee for the
Station, who will report and be solely accountable to the manager, and (3)
retain control over the policies, programming and operations of the Station.
Nothing contained herein shall prevent Licensee from (a) rejecting or refusing
programs which Licensee believes to be contrary to the public interest, or (b)
substituting programs which Licensee believes to be of greater local or national
importance or which are designed to address the problems, needs and interests of
the local communities. Without limiting the preceding sentence, Licensee
reserves the right to (i) refuse to broadcast any Program containing matter
which violates any right of any third party, which constitutes a personal
attack, or which does not meet the requirements of the rules, regulations, and
policies of the FCC, (ii) preempt any Program in the event of a local, state, or
national emergency, or (iii) delete any commercial announcements that do not
comply with the requirements of the FCC’s sponsorship identification policy.
Programmer will immediately serve Licensee with notice and a copy of any letters
of complaint it receives concerning any Program for Licensee review and
inclusion in its public inspection file. Programmer shall cooperate with
Licensee to ensure that EAS transmissions are properly performed in accordance
with Licensee’s instructions.
7.    Music Licenses. During the Term, Licensee will obtain and maintain its
current music licenses with respect to the Station.
8.    Programs.
(a)    Programmer shall ensure that the contents of the Programs conform to all
FCC rules, regulations and policies. Programmer shall consult with Licensee in
the selection of the Programs to ensure that the Programs’ content contains
matters responsive to issues of public concern in the local communities, as
those issues are made known to Programmer by Licensee. On or before January 7,
April 7, July 7 and October 7 of every year during the Term,

 
- 2 -

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

Programmer shall provide to Licensee a list of significant community issues
addressed in the Programs during the preceding quarter and the specific Programs
that addressed such issues.
(b)    Licensee shall oversee and take ultimate responsibility with respect to
the provision of equal opportunities, lowest unit charge, and reasonable access
to political candidates, and compliance with the political broadcast rules of
the FCC. During the Term, Programmer shall cooperate with Licensee as Licensee
complies with its political broadcast responsibilities, and shall supply such
information promptly to Licensee as may be necessary to comply with the
political broadcasting provisions of the FCC’s rules, the Communications Act of
1934, as amended, and federal election laws. Programmer shall release
advertising availabilities to Licensee during the Broadcasting Period as
necessary to permit Licensee to comply with the political broadcast rules of the
FCC; provided, however, that revenues received by Licensee as a result of any
such release of advertising time shall promptly be remitted to Programmer.
9.    Expenses. During the Term, Programmer will be responsible for (i) the
salaries, taxes, insurance and other costs for all personnel used in the
production of the Programs supplied to Licensee, and (ii) the costs of
delivering the Programs to Licensee. Subject to Section 5, Licensee will pay for
its employees contemplated by Section 6, maintenance of all studio and
transmitter equipment and all other operating costs required to be paid to
maintain the Station’s broadcast operations in accordance with FCC rules and
policies and applicable law, and all utilities supplied to its main studio and
transmitter sites. Subject to Section 5, Licensee will provide all personnel
necessary for the broadcast transmission of the Programs (once received at its
transmitter site) and will be responsible for the salaries, taxes, insurance and
related costs for all such personnel.
10.    Call Signs. During the Term, Licensee will retain all rights to the call
letters of the Station or any other call letters which may be assigned by the
FCC for use by the Station, and will ensure that proper station identification
announcements are made with such call letters in accordance with FCC rules and
regulations. Programmer shall include in the Programs an announcement at the
beginning of each hour of such Programs to identify such call letters, as well
as any other announcements required by the rules and regulations of the FCC.
11.    Maintenance. During the Term, Licensee shall maintain the operating power
of the Station and shall repair and maintain the Station’s towers and
transmitter sites and equipment consistent with its past practice.
12.    Facilities. If requested by Programmer, during the Term, subject to any
necessary landlord consent, Licensee shall provide Programmer access to and the
use of designated space at Licensee’s studio and offices for the Station (for
purposes of providing the Programs and for no other purpose). Programmer may
only use such designated space and may use no other space at Licensee’s studio
facilities. When on Licensee’s premises, Programmer’s personnel shall be subject
to the direction and control of Licensee’s management personnel, and shall not
(i) act contrary to the terms of any lease for the premises, (ii) permit to
exist any lien, claim or encumbrance on the premises, or (iii) interfere with
the business and operation of Licensee’s station or Licensee’s use of such
premises. Nothing in this Agreement limits Licensee’s ability to modify or move
the space provided to Programmer pursuant to this Section and provide

 
- 3 -

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

alternative space to Programmer. This Section is subject and subordinate to
Licensee’s lease for such studio and office facilities (if any) and does not
constitute a grant of any real property interest.
13.    Representations. Programmer and Licensee each represent and warrant to
the other that (i) it has the power and authority to enter into this Agreement
and to consummate the transactions contemplated hereby, (ii) it is in good
standing in the jurisdiction of its organization and is qualified to do business
in all jurisdictions where the nature of its business requires such
qualification, (iii) it has duly authorized this Agreement, and this Agreement
is binding upon it, and (iv) the execution, delivery, and performance by it of
this Agreement does not conflict with, result in a breach of, or constitute a
default or ground for termination under any agreement to which it is a party or
by which it is bound.
14.    Purchase Agreement. This Agreement shall terminate automatically upon
Closing under the Purchase Agreement. This Agreement may be terminated by either
party by written notice to the other in the event of any expiration or
termination of the Purchase Agreement.
15.    Events of Default.
(a)    The occurrence of any of the following will be deemed an Event of Default
by Programmer under this Agreement: (i) Programmer fails to timely make any
payment required under this Agreement; (ii) Programmer fails to observe or
perform any other obligation contained in this Agreement in any material
respect; or (iii) Programmer breaches any representation or warranty made by it
under this Agreement in any material respect.

(b)    The occurrence of the following will be deemed an Event of Default by
Licensee under this Agreement: (i) Licensee fails to observe or perform any
obligation contained in this Agreement in any material respect; or (ii) Licensee
breaches any representation or warranty made by it under this Agreement in any
material respect.
(c)    Notwithstanding the foregoing, any non-monetary Event of Default will not
be deemed to have occurred until fifteen (15) calendar days after the
non-defaulting party has provided the defaulting party with written notice
specifying the Event of Default and such Event of Default remains uncured. Upon
the occurrence of an Event of Default, and in the absence of a timely cure
pursuant to this Section, the non-defaulting party may terminate this Agreement,
effective immediately upon written notice to the defaulting party. If this
Agreement is terminated for any reason other than at closing under the Purchase
Agreement, the parties agree to cooperate with one another and to take all
actions necessary to rescind this Agreement and return the parties to the status
quo ante. Failure of Licensee to broadcast the Programs due to facility
maintenance, repair or modification or due to any reason out of Licensee’s
reasonable control shall not constitute an Event of Default by Licensee
hereunder.

 
- 4 -

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

16.       Indemnification.  Programmer shall indemnify and hold Licensee
harmless against any and all liability arising from the broadcast of the
Programs on the Station, including without limitation all liability for
indecency, libel, slander, illegal competition or trade practice, infringement
of trademarks, trade names, or program titles, violation of rights of privacy,
and infringement of copyrights and proprietary rights or any other violation of
third party rights or FCC rules or other applicable law. Licensee shall
indemnify and hold Programmer harmless against any and all liability arising
from the broadcast of Licensee’s programming on the Station, including without
limitation all liability for indecency, libel, slander, illegal competition or
trade practice, infringement of trademarks, trade names, or program titles,
violation of rights of privacy, and infringement of copyrights and proprietary
rights or any other violation of third party rights or FCC rules or other
applicable law.  The obligations under this Section shall survive any
termination of this Agreement.
17.    Assignment. Neither party may assign this Agreement without the prior
written consent of the other party hereto. The terms of this Agreement shall
bind and inure to the benefit of the parties’ respective successors and any
permitted assigns, and no assignment shall relieve any party of any obligation
or liability under this Agreement. Nothing in this Agreement expressed or
implied is intended or shall be construed to give any rights to any person or
entity other than the parties hereto and their successors and permitted assigns.
18.    Severability. If any court or governmental authority holds any provision
in this Agreement invalid, illegal, or unenforceable under any applicable law,
then so long as no party is deprived of the benefits of this Agreement in any
material respect, this Agreement shall be construed with the invalid, illegal or
unenforceable provision deleted and the validity, legality and enforceability of
the remaining provisions contained herein shall not be affected or impaired
thereby. The obligations of the parties under this Agreement are subject to the
rules, regulations and policies of the FCC and all other applicable laws. The
parties agree that Licensee may file a copy of this Agreement with the FCC, and
that Licensee shall place a copy of this Agreement in the Station’ public
inspection files.

19.    Notices. Any notice pursuant to this Agreement shall be in writing and
shall be deemed delivered on the date of personal delivery or confirmed
facsimile transmission or confirmed delivery by a nationally recognized
overnight courier service, or on the third day after prepaid mailing by
certified U.S. mail, return receipt requested, and shall be addressed as follows
(or to such other address as any party may request by written notice):
If to Programmer:    Meruelo Group LLC
9950 Firestone Blvd., Ste. 105
Downey, CA 90241
Attn: General Counsel
Facsimile: (562) 745-2341

 
- 5 -

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

If to Licensee:        Emmis Communications Corporation
One Emmis Plaza
40 Monument Circle, Suite 700
Indianapolis, Indiana 46204
Attn: President and CEO
Attn: General Counsel
Facsimile: (317) 684-5583

With a copy, which shall not constitute notice, to:

Wilkinson Barker Knauer, LLP
1800 M Street, NW, Suite 800N
Washington, DC 20036
Attn: Doc Bodensteiner
Facsimile: (202) 783-5851

20.    Miscellaneous. This Agreement may be executed in separate counterparts,
each of which will be deemed an original and all of which together will
constitute one and the same agreement. No amendment or waiver of compliance with
any provision hereof or consent pursuant to this Agreement shall be effective
unless evidenced by an instrument in writing signed by the party against whom
enforcement of such amendment, waiver, or consent is sought. This Agreement is
not intended to be, and shall not be construed as, an agreement to form a
partnership, agency relationship, or joint venture between the parties. Neither
party shall be authorized to act as an agent of or otherwise to represent the
other party. The construction and performance of this Agreement shall be
governed by the laws of the State of California without giving effect to the
choice of law provisions thereof. This Agreement (including the Schedule hereto)
constitutes the entire agreement and understanding among the parties hereto with
respect to the subject matter hereof, and supersedes all prior agreements and
understandings with respect to the subject matter hereof.

21.    Certifications. Licensee certifies that it maintains ultimate control
over the Station’ facilities including, specifically, control over the Station’s
finances, personnel and programming.  Programmer certifies that this Agreement
complies with the provisions of 47 C.F.R. Sections 73.3555(a) and (c).

22.    Nondiscrimination. In accordance with Paragraphs 49 and 50 of United
States Federal Communications Commission Report and Order No. FCC 07-217,
Programmer shall not discriminate in any contract for advertising on the Station
on the basis of race or gender, and all such contracts shall be evaluated,
negotiated and completed without regard to race or gender. Programmer shall
include a clause to such effect in all contracts for advertising on the Station,
and if requested shall provide written confirmation of compliance with such
requirement.

23.    Public Announcement.  Except as provided in the Purchase Agreement,
neither party shall  publish any press release, make any public announcement or
otherwise publicly

 
- 6 -

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

disclose any aspect or other matter concerning this Agreement or the
transactions contemplated hereby, including but not limited to negotiations or
existence thereof, without the prior written consent of the other party;
provided, however, that nothing contained herein shall prevent either party
from, submitting this Agreement as part of any required filing with any
government authority or from any required placement in the Station’s public
inspection file in a timely manner.

4849-9457-9271
[SIGNATURE PAGE FOLLOWS]

 
- 7 -

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

SIGNATURE PAGE TO LOCAL PROGRAMMING AND MARKETING AGREEMENT

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
first set forth above.

Licensee:
 
Emmis Radio License, LLC
 
 
 
 
 
 
By:
/s/ J. Scott Enright
 
 
 
Name: J. Scott Enright
 
 
 
Title: Executive Vice President, General Counsel and Secretary
 
 
 
 
Programmer:
 
KWHY-22 Broadcasting, LLC
 
 
 
 
 
 
By:
/s/ Alex Meruelo
 
 
 
Name: Alex Meruelo
 
 
 
Title: Manager

    

 
- 1 -

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

SCHEDULE A TO LMA

During the Term, Programmer shall (i) pay Licensee the Monthly Fee (defined
below) per calendar month (each such payment due in advance on the first day of
each such month), plus (ii) reimburse Licensee for the operating and maintenance
expenses of the Station incurred by Licensee in the ordinary course of business
(each such reimbursement due upon invoice).

If Programmer uses commercially reasonable efforts to maximize Station revenue
during the Term, but despite such efforts a Deficiency (defined below) exists,
then:

(i)  Licensee shall reimburse the Deficiency Amount (defined below), if any, to
Programmer, determined in arrears on a monthly but cumulative basis with payment
by Licensee of any necessary reimbursement or by Programmer of any excess
reimbursement; and

(ii)  subject to Closing under the Purchase Agreement, the Purchase Price
thereunder shall be reduced by the Adjustment Amount (defined below).

As used herein, the following terms have the following meanings:

“2018 Fiscal Year Budget” means the KPWR Summary Income Statement Fiscal 2018
Budget delivered by Licensee to Programmer.

“Actual Net Revenue” means for any month the gross revenue of Programmer arising
from the Station, net of Commissions for such month, determined in accordance
with GAAP.

“Adjusted BCF” means for any month Actual Net Revenue less Budgeted Expense plus
Budgeted Other Income.

“Adjustment Amount” means an amount equal to 4 times the Shortfall Amount but in
no event shall the total Adjustment Amount exceed $2,750,000.

“Budgeted Expense” means for any month the amount shown for such month
(regardless of year) in the Total Expense line of the 2018 Fiscal Year Budget,
with any partial month prorated.

“Budgeted Other Income” means for any month the amount shown for such month
(regardless of year) in the Other Income line of the 2018 Fiscal Year Budget,
with any partial month prorated.

“Commissions” means commissions paid on ad sales consistent with the Station’s
past practices.

“Deficiency” means the condition existing if cumulative Adjusted BCF during the
Term is less than the cumulative Monthly Fee during the Term.

“Deficiency Amount” means the amount, if any, by which cumulative Adjusted BCF
during the Term is less than the cumulative Monthly Fee during the Term.

 
- 1 -

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

“GAAP” means generally accepted accounting principles in the United States of
America, consistently applied with Station’s past practices.

“Monthly Fee” means an amount equal to 80% of Projected BCF for the applicable
month, with any partial month prorated (but without duplication of proration).

“Projected BCF” means for any month the amount shown for such month (regardless
of year) in the BCF line of the 2018 Fiscal Year Budget, with any partial month
prorated.

“Shortfall Amount” means the amount, if any, by which cumulative Adjusted BCF
during the Term is less than cumulative Projected BCF during the Term.  

 
- 2 -