Exhibit 10.1

March 27, 2011
CONFIDENTIAL

Emmis Operating Company
Emmis Communications Corporation
One Emmis Plaza
40 Monument Circle, Suite 700
Indianapolis, IN 46204
Attention: Jeffrey H. Smulyan

Re:  Third Amendment to Credit Agreement

Ladies & Gentlemen:

Reference is made to that certain Amended and Restated Revolving Credit and Term
Loan Agreement, dated November 2, 2006, as amended by (i) that certain First
Amendment and Consent to Amended and Restated Revolving Credit And Term Loan
Agreement, dated as of March 3, 2009, by and among the Emmis Operating Company
(the “Company” or “you”), Emmis Communications Corporation (the “Parent”), the
lending institutions party thereto (the "Lenders"), the Bank of America, N.A.,
as administrative agent (the “Administrative Agent”), Deutsche Bank Trust
Company Americas, as syndication agent, General Electric Capital Corporation,
Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank Nederland", New
York Branch and SunTrust Bank, as co-documentation agents; and (ii) that certain
Second Amendment to Amended and Restated Revolving Credit and Term Loan
Facility, dated as of August 19, 2009 (as further amended, supplemented, and
restated or otherwise modified and in effect from time to time, the "Credit
Agreement"), among the Company, the Parent, the Lenders and the Administrative
Agent.  Capitalized terms not otherwise defined herein shall have the meaning
defined in the Credit Agreement
 
You have informed us that you desire to amend the Credit Agreement substantially
in the form attached hereto as Exhibit A (the “Amendment”).  In connection
therewith, you have requested that Canyon Capital Advisors LLC on behalf of
funds and accounts managed or advised by it (in such capacity, “Canyon” or
“we”), a lender under the Credit Agreement, agree to (i) consent to the
Amendment and (ii) make commercially reasonable efforts during the period
commencing on March 28, 2011 through and including April 6, 2011 to purchase
from other Lenders, at a purchase price of up to par plus accrued and unpaid
interest, such additional indebtedness (the “Required Amount”) under the Credit
Agreement as will be required (including, if necessary, amounts in excess of an
amount that would cause the Required Amount plus the amount described in clause
(a) of the definition of Backstop Amount below to exceed the amount required for
Canyon to constitute the Required Lenders under the Credit Agreement if either
(x) any selling Lender requires that Canyon purchase all of its Loans or (y)
Canyon is unable (after using its commercially reasonable efforts to do so) to
vote or cause the selling Lender to vote for the Amendment in respect of any
previously agreed but not yet settled trades, so long as such excess amount does
not exceed in the aggregate 10% of the sum of the Tranche B Term Loans and the
Revolving Credit Commitments of Canyon (such cap, the “Excess Cap”)) to ensure
that the Amendment has the consent of the Required Lenders (the
“Backstop”).  The sum of (a) the Tranche B Term Loans and Revolving Credit
Commitments owned by Canyon on the date hereof (being $110 million, of
which  $30 million is an amount in respect of previously agreed but not yet
settled trades) plus (b) the Required Amount, plus (c) any Tranche B Term Loans
that you request us to purchase in excess of the Required Amount and that we
agree  (and we will agree to purchase if the amount to be purchased together
with any amounts purchased to obtain the Required Amount do not cause the Excess
Cap to be exceeded) to purchase (provided that the closing of such purchase
shall not be required so long as Canyon obtains
 
 
 
 

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voting rights with respect to unsettled purchases) prior to the effectiveness of
the Amendment are herein referred to as the “Backstop Amount”; for the avoidance
of doubt, the Backstop Amount also includes any Revolving Credit Commitments
acquired or held by Canyon prior to the Amendment Effective Date.  We agree to
consent to the Amendment and provide the Backstop in accordance with the terms
and conditions set forth below.
 
As consideration for our consent and our providing the Backstop, you agree, if
and to the extent the Amendment becomes effective, to provide the then holders
of the Tranche B Term Loans and the Revolving Credit Commitments comprising the
Backstop Amount with a fee (the “Exit Fee”) upon the redemption or other
repayment (including, without limitation, as a result of an acceleration upon
any Event of Default, including a proceeding in bankruptcy) of any Tranche B
Term Loans or the termination of any Revolving Credit Commitments that are held
by us and included in the Backstop Amount.  For purposes of this letter, with
respect to the Tranche B Term Loans, the Backstop Amount shall be deemed to be
redeemed or prepaid pro rata with all other outstanding Tranche B Term
Loans.  Such fee shall be in the amount of (i) in the first six months following
the effectiveness of the Amendment (the “Amendment Effective Date”), 3% of the
Backstop Amount redeemed or prepaid, and (ii) thereafter, 6% of the Backstop
Amount redeemed or prepaid; provided, that the fee in connection with any such
Tranche B Term Loans or Revolving Credit Commitments that (i) are redeemed or
repaid or terminated more than six months after the Amendment Effective Date but
less than one year after the Amendment Effective Date in connection with the
consummation of any Asset Sale that was agreed to pursuant to definitive
documentation, and submitted to the Federal Communications Commission, during
the first six months following the Amendment Effective Date but not consummated
at such time due to requirements imposed by the Federal Communications
Commission or any other regulatory body, shall be 3%.
 
The Exit Fee shall be due and payable in cash, promptly upon the redemption or
other repayment of any Tranche B Term Loans or termination of the Revolving
Credit Commitments included in the Backstop Amount that are held by us, in
accordance with the wire instructions to be provided by Canyon, and to any other
holder of such Tranche B Term Loans or Revolving Credit Commitments included in
the Backstop Amount at the address of such holder on the company’s records.
 
In further consideration of the efforts of Canyon hereunder, Parent and the
Company agree to use all commercially reasonable efforts to receive the required
consents and acknowledgements and to take all other actions needed for the
consummation of the transactions contemplated herein, and  further agree that
for a period of 10 days from the date of this agreement they will not seek nor
entertain, nor take any other actions in furtherance thereof, any financing or
other transaction which may render unnecessary, inadvisable or replace the
Amendment contemplated herein.
 
Company and Parent agree that, without the consent of Canyon (as long as Canyon
owns at least 50% of the amount of Extended Tranche B Term Loans owned by it on
the effective date of the Amendment), neither Company nor Parent will obtain any
additional secured Indebtedness, whether by amending the existing Credit
Agreement or otherwise, after the Effective Date if the “effective yield” on the
new indebtedness (which shall be deemed to take account of interest rate
benchmark floors, recurring fees and all upfront or similar fees or original
issue discount ) shall be higher than the effective yield of the Extended
Tranche B Term Loans.
 
In recognition of Canyon’s efforts with respect to the Amendment, and for other
good and adequate consideration, the adequacy and receipt of which is hereby
acknowledged, the Company and Parent agree to indemnify and hold harmless
Canyon, and its respective affiliates, officers, directors, employees, agents,
successors, trustees and advisors (each such Person an “Indemnified Person”)
from and against any and all claims, actions and suits whether groundless or
otherwise, and from and against any and all liabilities, losses, damages and
expenses of every nature and character arising out of the
 
 
 
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Amendment, or the transactions contemplated as part of the Amendment including,
without limitation, (a) any actual or threatened claim by any other Person,
including any other Lender or the Administrative Agent, Parent, the Company or
any of their Subsidiaries regarding the negotiation of and entry into the
Amendment, or (b) the failure of Parent, the Company or any of their
Subsidiaries to offer the same terms to any other Person as offered to Canyon,
in each case including, without limitation, the reasonable fees and
disbursements of outside counsel incurred in connection with any investigation,
litigation or other proceeding, regardless if the same proceeded to litigation
(all the foregoing, collectively, the “Indemnified Liabilities”), except to the
extent any of the foregoing Indemnified Liabilities result solely from the
willful misconduct of any such Indemnified Person. In litigation, or the
preparation therefore, such Indemnified Person shall be entitled to select its
own counsel and, in addition to the foregoing indemnity, Parent and the Company
agree to pay promptly the reasonable fees and expenses of such counsel.
 
Parent and the Company further agree to pay (a) the reasonable costs of Canyon
in negotiating this agreement and the Amendment and the other agreements and
instruments mentioned therein, and (b) at any time that Canyon holds at least
50% of the amount of Extended Tranche B Term Loans owned by it on the effective
date of the Amendment, (i) the reasonable fees, expenses and disbursements of
Canyon’s counsel incurred in connection with the preparation, administration or
interpretation of this agreement and the Amendment, each closing thereunder, and
any amendments, modifications, approvals, consents or waivers hereto or
thereunder, (ii) the fees, expenses and disbursements of Canyon or its
affiliates incurred by Canyon or such affiliate in connection with the
preparation or interpretation of this agreement and the Amendment and other
instruments mentioned therein, (iii) all reasonable out-of-pocket expenses
(including without limitation reasonable attorneys’ fees and costs, and
reasonable consulting, accounting, appraisal, investment bank and similar
professional fees and charges) incurred by Canyon in connection with (1) the
enforcement of or preservation of rights under this agreement or the Amendment
against Parent, the Company or any of their Subsidiaries and (2) any litigation,
proceeding or dispute whether arising hereunder or otherwise, in any way related
to Canyon’s relationship with Parent, the Company or any of their Subsidiaries,
and (iv) all reasonable fees, expenses and disbursements of Canyon incurred in
connection with searches, filings or recordings.
 
The covenants contained in this agreement shall be effective and shall apply
regardless of the execution of, or failure to execute and deliver, the Amendment
and shall survive payment or satisfaction in full of all Obligations.
 
This agreement is the result of negotiation among, and has been reviewed by
counsel to, Canyon, Parent and the Company and is the product of discussions and
negotiations among all parties.  Accordingly, this agreement is not intended to
be construed against any party merely on account of such party’s involvement in
the preparation of such documents.  This agreement, upon the Amendment Effective
Date, shall be considered a Loan Document and shall be entitled to the benefits
thereof.  Nothing herein shall limit any rights or benefits which may inure to
the benefit of Canyon as a Lender under the Amendment or any other Loan
Document.
 
The provisions of this agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns.  This
agreement may only be amended upon the consent of a majority of the holders of
the aggregate outstanding principal amount of the Tranche B Term Loans included
in the Backstop Amount.
 
This agreement shall be governed by and construed in accordance with the
internal laws of the State of New York, embodies the entire agreement and
supersedes any prior written or oral agreement relating to the subject matter
hereof, and may only be amended or waived in writing signed by both you and
us.  Any proceeding arising out of this agreement shall be heard in a New York
state or federal court sitting in the city and county of New York, to whose
jurisdiction and forum Canyon and the
 
 
 
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 Company irrevocably submit. The Company also irrevocably consents to the
service of process in any such proceeding by mail at the Company’s address set
forth above.   This agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which shall constitute one and
the same agreement.  This agreement shall be binding upon the Company and us and
its and our respective successors and assigns. WE AND THE COMPANY (ON ITS OWN
BEHALF AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ON BEHALF OF ITS SECURITY
HOLDERS) WAIVE ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY PROCEEDING ARISING
OUT OF THIS AGREEMENT.
 
(Signature page follows)
 
 
 
 
 

 
 
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Please sign and return to us the enclosed duplicate of this agreement.  The
individuals signing this agreement each represent that he or she is authorized
to execute and deliver it on behalf of the entity whose name appears above his
or her signature.
 

   Very truly yours,                
CANYON CAPITAL ADVISORS LLC
 
         
 
By:
 /s/ Jonathan M. Kaplan       Name:  Jonathan M. Kaplan        Title:    General
Counsel          

 
 
Accepted and agreed to as of the date first written above:
 

 EMMIS OPERATING COMPANY          
By:
 /s/ J. Scott Enright
 
    Name:  J. Scott Enright       Title:    Executive Vice President,
     General Counsel and Secretary            

 

 
EMMIS COMMUNICATIONS CORPORATION
         
By:
 /s/ J. Scott Enright
 
    Name:  J. Scott Enright       Title:    Executive Vice President,
     General Counsel and Secretary            

 
 
 
 

 
 
 
 
 
 
 
 
 
 
 

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