Document:

backupsecurityagmt.htm

  

  

  

 

 

FINANCIAL SERVICES VEHICLE TRUST,

 

BMW MANUFACTURING L.P.,

 

BMW AUTO LEASING LLC,

 

BMW VEHICLE LEASE TRUST 2012-1,

 

and

 

U.S. BANK NATIONAL ASSOCIATION,

as Indenture Trustee

 

BACK-UP SECURITY AGREEMENT

Dated as of April 26, 2012

 

 

 

 

 

  

  

  

TABLE OF CONTENTS

Page

 

	
ARTICLE ONE

	
DEFINITIONS

	
2

	 	 	 
	
Section 1.01.

	
Definitions

	
2

	
Section 1.02.

	
Interpretive Provisions

	
3

	 	 	 
	
ARTICLE TWO

	
SECURITY INTEREST

	
3

	 	 	 
	
Section 2.01.

	
Grant of Security Interest.

	
3

	
Section 2.02.

	
Certificate of Title

	
4

	
Section 2.03.

	
Filing of Financing Statements.

	
4

	
Section 2.04.

	
Use of Collateral

	
5

	
Section 2.05.

	
Further Description of the Collateral

	
5

	
Section 2.06.

	
Back-Up Rights of Issuer

	
5

	 	 	 
	
ARTICLE THREE

	
MISCELLANEOUS

	
5

	 	 	 
	
Section 3.01.

	
Amendments

	
5

	
Section 3.02.

	
Governing Law

	
5

	
Section 3.03.

	
Severability of Provisions

	
5

	
Section 3.04.

	
Counterparts

	
5

	
Section 3.05.

	
Successors and Assigns

	
5

	
Section 3.06.

	
Further Assurances

	
6

	
Section 3.07.

	
Limitation of Liability of Owner Trustee, the Trustee and the Indenture Trustee.

	
6

	
Section 3.08.

	
Notices

	
6

	
Section 3.09.

	
Series Disclaimer and Acknowledgment

	
7

	  	  	  
	
SCHEDULES

	  	
A-1

	       Schedule A — Schedule of 2012-1 Leases	  

  

  

  

BACK-UP SECURITY AGREEMENT

 

This Back-Up Security Agreement, dated as of April 26, 2012, is among Financial Services Vehicle Trust, a Delaware statutory trust (the “Vehicle Trust”), BMW Manufacturing L.P., an Indiana limited partnership (“BMW LP”), BMW Auto Leasing LLC, a Delaware limited liability company (the “Transferor”), BMW Vehicle Lease Trust 2012-1, a Delaware statutory trust (the “Issuer”), and U.S. Bank National Association, a national banking association, not in its individual capacity, but solely as indenture trustee (the “Indenture Trustee”) under the Indenture, dated as of April 26, 2012 (the “Indenture”), from the Issuer to the Indenture Trustee.

 

RECITALS

 

WHEREAS, the Vehicle Trust is governed by the Amended and Restated Trust Agreement, dated as of September 27, 1996, as further amended as of May 25, 2000 and December 1, 2006 (the “Vehicle Trust Agreement”), between BMW LP and BNY Mellon Trust of Delaware, formerly known as The Bank of New York (Delaware), a Delaware banking corporation, as Trustee (the “Trustee”);

 

WHEREAS, the Vehicle Trust was formed for the purposes of taking assignments and conveyances of, holding in trust and releasing its ownership interest in, various trust assets, including lease contracts (insofar as such lease contracts pertain to particular passenger cars, motorcycles or light trucks) and the related passenger cars, motorcycles or light trucks;

 

WHEREAS, the parties to the Vehicle Trust Agreement supplemented the Vehicle Trust Agreement with a supplement, dated as of April 26, 2012 (the “2012-1 Vehicle Trust Supplement” and together with the Vehicle Trust Agreement, the “SUBI Trust Agreement”), to establish one special unit of beneficial interest (the “2012-1 SUBI”);

 

WHEREAS, in connection with the SUBI Trust Agreement, a separate portfolio of Leases (the “2012-1 Leases”), the Leased Vehicles that are leased under the 2012-1 Leases (the “2012-1 Vehicles”) and certain other related assets of the Vehicle Trust have been allocated to the 2012-1 SUBI;

 

WHEREAS, the Vehicle Trust has issued to BMW LP a certificate evidencing a beneficial interest in the 2012-1 SUBI (the “2012-1 SUBI Certificate”);

 

WHEREAS, the Issuer was formed pursuant to that certain trust agreement, dated as of March 14, 2012, as amended and restated as of April 26, 2012, between the Transferor and Wilmington Trust, National Association, a national banking association, as owner trustee (the “Trust Agreement”);

 

WHEREAS, pursuant to the SUBI certificate transfer agreement, dated as of April 26, 2012 (the “SUBI Certificate Transfer Agreement”), between BMW LP and the

 

  

  

  

  

Transferor, BMW LP has transferred and assigned, without recourse, to the Transferor, all of BMW LP’s interest in the 2012-1 SUBI Certificate and certain other rights in consideration of the Transfer Price (as defined therein);

 

WHEREAS, pursuant to the Issuer SUBI certificate transfer agreement, dated as of April 26, 2012 (the “Issuer SUBI Certificate Transfer Agreement”), between the Transferor and the Issuer, the Transferor has transferred and assigned, without recourse, to the Issuer, all of the Transferor’s interest in the 2012-1 SUBI Certificate and certain other rights in consideration of the Transfer Price (as defined therein);

 

WHEREAS, pursuant to the Indenture, the Issuer has granted a security interest in the 2012-1 SUBI Certificate to the Indenture Trustee to secure payment of the Notes; and

 

WHEREAS, the parties hereto desire to provide that if, for any reason, the form of any of the transactions contemplated by the SUBI Trust Agreement, the 2012-1 SUBI Certificate, the Trust Agreement or the Indenture (collectively, the “Transfer Documents”) are deemed to constitute a loan by any or all of the Securityholders (as defined in the Trust Agreement), secured by a pledge of the 2012-1 SUBI Assets or any interest therein (rather than by the 2012-1 SUBI Certificate), each of the Vehicle Trust, BMW LP and the Transferor shall be deemed to have granted to the Issuer a first priority security interest in the Collateral (as defined herein) to secure the Securities, which security interest the Issuer shall have assigned to the Indenture Trustee to secure the Notes.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, and of other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

ARTICLE ONE

 

DEFINITIONS

 

Section 1.01.   Definitions.  Whenever used herein, unless the context otherwise requires, (i) capitalized terms not otherwise defined herein have the meanings ascribed thereto in the SUBI Trust Agreement, and if not defined therein, in the Servicing Agreement, (ii) capitalized terms defined in the Preamble and the Recitals have the meanings set forth therein and (iii) the following words and phrases shall have the following meanings:

 

“Agreement” means this Back-Up Security Agreement, as amended or supplemented from time to time.

 

“Back-Up Event” means that a court of competent jurisdiction has made a determination or ruling that has the effect of allowing realization on the security intended to be provided to the Issuer by the Transfer Documents only if such transactions are deemed to constitute a loan by the Issuer, secured directly by a pledge of the 2012-1

 

 

            

  

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SUBI Assets or any interest therein (rather than by the 2012-1 SUBI Certificate and the beneficial interest in the 2012-1 SUBI Assets represented thereby).

 

“Collateral” has the meaning set forth in Section 2.01(a).

 

“Pledgors” means the Vehicle Trust, BMW LP and the Transferor.

 

“Servicing Agreement” means the Basic Servicing Agreement, dated as of August 30, 1995, between the Vehicle Trust, BMW LP and BMW Financial Services NA, LLC (“BMW FS”), as servicer, as supplemented by the Servicing Supplement, dated as of April 26, 2012, among the Vehicle Trust, BMW LP, and BMW FS, as servicer.

 

“Trust Assets” has the meaning set forth in the SUBI Trust Agreement.

 

“UCC” means the Uniform Commercial Code as in effect in the applicable jurisdiction.

 

Section 1.02.   Interpretive Provisions.  For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires, (i) terms used herein include, as appropriate, all genders and the plural as well as the singular, (ii) references to words such as “herein”, “hereof” and the like shall refer to this Agreement as a whole and not to any particular part, Article or Section herein, (iii) references to an Article or Section such as “Article One” or “Section 1.01” shall refer to the applicable Article or Section of this Agreement, (iv) the term “include” and all variations thereof shall mean “include without limitation” and (v) the term “proceeds” shall have the meaning ascribed to such term in the UCC.

 

ARTICLE TWO

 

SECURITY INTEREST

 

Section 2.01.   Grant of Security Interest.

 

(a)           Each of the Vehicle Trust, BMW LP and the Transferor hereby grants to the Issuer a security interest in all of its present and future right, title and interest, if any, in, to and under (but not, except to the extent required by law, any obligations with respect to) the following collateral (the “Collateral”):  (i) a 100% interest in (A) all rights under the 2012-1 Leases; (B) all other 2012-1 SUBI Assets, including the 2012-1 SUBI Collection Account but excluding the 2012-1 Vehicles except to the extent permitted by law and (C) all proceeds of the items described in (i) (A) and (i) (B), including insurance proceeds payable by reason of loss or damage to the 2012-1 Vehicles to the extent not applied to making repairs to the related 2012-1 Vehicle or otherwise paid by the Servicer to the Lessee, a third person or governmental authority as required by law or pursuant to its normal servicing practices and (ii) all proceeds of the foregoing.  Such grant is made to secure (i) the payment of all amounts due on the Securities in accordance

 

 

            

  

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with their terms in the priorities of payment set forth in the Indenture, (ii) the payment of all other sums payable under the Trust Agreement or the Indenture and (iii) compliance with the provisions of the Trust Agreement and the Indenture.

 

(b)           The Issuer hereby assigns to the Indenture Trustee its security interests in the Collateral granted to the Issuer pursuant to Section 2.01(a) hereof to secure (i) the payment of all amounts due on the Notes, (ii) the payment of all other sums payable under the Indenture and (iii) compliance with the provisions of the Indenture.

 

(c)           Each of the Issuer and the Indenture Trustee acknowledges such grant and assignment, but all parties hereto acknowledge and agree that (i) such grant and assignment are made solely for protective purposes and without representation or warranty as to the nature of any of parties’ rights in and to the Collateral; and (ii) none of the parties hereto intends to imply in any way that any of the Transfer Documents should not be interpreted or enforced in accordance with its respective terms.  Each of the Trustee and the Indenture Trustee also acknowledges that it shall have no claim to any proceeds or assets of the Vehicle Trust or to any of the Trust Assets other than the Collateral.

 

Section 2.02.   Certificate of Title.  None of the parties hereto, including the Vehicle Trust, shall be required to make notation on, or cause to be taken any other action with respect to, any Certificate of Title for any 2012-1 Vehicle to reflect the back-up Lien created hereby.

 

Section 2.03.   Filing of Financing Statements.

 

(a)           Each of the Vehicle Trust, BMW LP, the Transferor and the Issuer, will from time to time execute, deliver and file all UCC financing statements and continuation statements reasonably required or necessary to maintain, perfect or continue the perfection of the back-up Lien created hereby with respect to the 2012-1 Leases and the proceeds thereof and any other Collateral, the perfection of a security interest in which may be accomplished and continued by the same filings.  Each of BMW LP, the Transferor and the Issuer acknowledge and agree that the UCC-1 financing statement filed against BMW LP in connection with the transactions contemplated by the SUBI Certificate Transfer Agreement shall be assigned directly by the Transferor to the Indenture Trustee as secured party of record. The obligations of the Issuer hereunder will be performed by the Administrator.

 

(b)           Upon release of the lien of the Indenture, the Indenture Trustee shall execute and file such partial or full releases or partial or full assignments of financing statements and other documents and instruments as may be prepared and reasonably requested by the Issuer to assign the Indenture Trustee’s interests hereunder back to the Issuer.

 

 

            

  

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Section 2.04.   Use of Collateral.  Each of the parties granting a security interest hereunder may continue to use and deal with its interest in the Collateral in any lawful manner and may sell items of Collateral in the ordinary course of its business, subject only to the requirements of the Transfer Documents, the Servicing Agreement or any other Basic Document, as appropriate.

 

Section 2.05.   Further Description of the Collateral.  Schedule A attached hereto contains a description of the 2012-1 Leases.

 

Section 2.06.   Back-Up Rights of Issuer.  If a Back-Up Event shall have occurred and be continuing, the Issuer may exercise the rights and remedies with respect to the Collateral of a secured party under the UCC to the extent permitted by applicable law.  Notwithstanding any other provision hereof, the Issuer shall have recourse only against the Collateral and not against any Pledgor hereunder.

 

ARTICLE THREE

 

MISCELLANEOUS

 

Section 3.01.   Amendments.  This Agreement may be amended by written agreement among the parties hereto; provided, however, that it may only be amended under the same circumstances the Trust Agreement could be amended pursuant to Section 12.01 thereof and the Indenture could be amended pursuant to Article Nine thereof.

 

Section 3.02.   Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICTS OF LAW (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

 

Section 3.03.          Severability of Provisions.  If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid or unenforceable, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions and terms of this Agreement, as the same may be amended or supplemented, and shall in no way affect the validity or enforceability of the other covenants, agreements, provisions or terms of this Agreement.

 

Section 3.04.          Counterparts.  This Agreement may be executed in any number of counterparts, each of which so executed and delivered shall be deemed to be an original, but all of which counterparts shall together constitute but one and the same instrument.

 

Section 3.05.          Successors and Assigns.  All covenants and agreements contained in this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective permitted successors and assigns.

 

 

            

  

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Section 3.06.   Further Assurances.  Each party will perform such acts and execute and deliver to any other party such additional documents or instruments as may be reasonably requested in order to effect the purposes of this Agreement and to better assure and confirm unto the requesting party its rights, powers and remedies hereunder.

 

Section 3.07.          Limitation of Liability of the Owner Trustee, the Trustee and the Indenture Trustee.

 

(a)           Notwithstanding anything contained herein to the contrary, this instrument has been countersigned by Wilmington Trust, National Association not in its individual capacity but solely in its capacity as Owner Trustee of the Issuer and in no event shall Wilmington Trust, National Association in its individual capacity or, except as expressly provided in the Trust Agreement, as Owner Trustee of the Issuer, have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer in accordance with the priorities set forth in the Indenture.  For all purposes of this Agreement, in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles Six, Seven and Eight of the Trust Agreement.

 

(b)           Notwithstanding anything contained herein to the contrary, this instrument has been countersigned by BNY Mellon Trust of Delaware not in its individual capacity but solely in its capacity as Trustee of the Vehicle Trust and in no event shall BNY Mellon Trust of Delaware in its individual capacity have any liability for the representations, warranties, covenants, agreements or other obligations of the Vehicle Trust hereunder, as to all of which recourse shall be had solely to the assets of the Vehicle Trust.  For all purposes of this Agreement, in the performance of any duties or obligations of the Vehicle Trust hereunder, the Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Part VI of the SUBI Trust Agreement.

 

(c)           Notwithstanding anything contained herein to the contrary, this instrument has been countersigned by U.S. Bank National Association not in its individual capacity but solely in its capacity as Indenture Trustee and in no event shall U.S. Bank National Association in its individual capacity have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered pursuant hereto.

 

Section 3.08.          Notices.  All notices, requests and demands under this Agreement shall be given in accordance with Section 11.04 of the Indenture.  The address for such purpose of (i) the Vehicle Trust shall be c/o BNY Mellon Trust of Delaware, 100 White Clay Center, Suite 102, P.O. Box 6995, Newark, DE 19711; (ii) BMW LP shall be 300 Chestnut Ridge Road, Woodcliff Lake, NJ 07677 (telecopier no. (201) 307-9286),

 

 

            

  

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Attention: General Counsel; and (iii) the Transferor shall be 300 Chestnut Ridge Road, Woodcliff Lake, NJ 07677 (telecopier no. (201) 307-9286), Attention: General Counsel.

 

Section 3.09.   Series Disclaimer and Acknowledgment.  The parties hereto acknowledge and agree that the Vehicle Trust is organized in series pursuant to Section 3804(a) and 3806(b)(2) of the Statutory Trust Statute.  As such, the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to each series of the Vehicle Trust shall be enforceable against the assets of such series of the Vehicle Trust only, and not against the assets of the Vehicle Trust generally or the assets of any other series of the Vehicle Trust or against the Trustee of the Vehicle Trust.  There may be several series of the Vehicle Trust created pursuant to the Vehicle Trust Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

            

  

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers hereto duly authorized, as of the day and year first above written.

 

 

	 	
FINANCIAL SERVICES VEHICLE TRUST, with respect to the 2012-1 SUBI

 

By:     BNY MELLON TRUST OF DELAWARE, not in its individual capacity but solely as Trustee 

 

 

 
By:  /s/ Kristine K. Gullo

       Name:   Kristine K. Gullo

       Title:     Vice President

 

 

BMW MANUFACTURING L.P.

 

By:    BMW FACILITY PARTNERS, LLC, as General Partner

 

 
By:  /s/ Joachim Hensel

       Name:   Joachim Hensel

       Title:     President

 

By:  /s/ Ralf Edelmann  

       Name:   Ralf Edelmann

       Title:     Treasurer

 

 

 

            

  

  

  

 

 

	 	

BMW AUTO LEASING LLC

 

 

 
By:     /s/ Joachim Hensel                                                      

          Name:  Joachim Hensel

          Title:     Vice President-Finance

 

By:     /s/ Ralf Edelmann                                                      

          Name:  Ralf Edelmann

          Title:    Treasurer

 

BMW VEHICLE LEASE TRUST 2012-1

 

By:    WILMINGTON TRUST, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee

 

 
By:      /s/ Adam Scozzafava

          Name:   Adam Scozzafava

          Title:      Banking Officer

 

 

U.S. BANK NATIONAL ASSOCIATION, not in its individual capacity but solely as Indenture Trustee

 

 
By:      /s/ Julia Linian

          Name:  Julia Linian

          Title:    Assistant Vice President

 

 

 

 

 

 

            

  

  

  

SCHEDULE A

 

Schedule of 2012-1 Leases

 

 [Omitted. Copies on file with the Servicer, the Trustee and the Owner Trustee.]

 

 

 

 

 

 

 

 

 

 

A-1eh1200612_ex1001.htm

EXHIBIT 10.1

 

LOCAL PROGRAMMING AND MARKETING AGREEMENT

THIS LOCAL PROGRAMMING AND MARKETING AGREEMENT (this “Agreement”) is made as of April 26, 2012 between Emmis Radio License Corporation of New York, a California corporation (“Licensee”) and New York AM Radio, LLC, a Delaware limited liability company (“Programmer”) that is a wholly-owned subsidiary of Disney Enterprises, Inc. (“Guarantor”).

 

Recitals

 

A.           Licensee owns and operates the following radio station, including all subcarrier, data, audio and auxiliary services, (the “Station”) pursuant to a license issued by the Federal Communications Commission (“FCC”):

 

WRKS-FM (98.7 FM), New York, New York, including all HD subcarrier, data, audio and auxiliary services

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.

Agreement

 

NOW, THEREFORE, 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 April 30, 2012 and will continue until August 31, 2024 subject to renewal of the Station’s FCC license, which currently has a June 1, 2014 expiration date, and for which Licensee shall timely file and prosecute all license renewal applications that are required to be filed during the Term.  Licensee shall also file and prosecute any other FCC applications necessary for the full and effective operation of the Station.

 

2.           Programming.  During the Term, Programmer shall purchase from Licensee the airtime of the Station for the price and on the terms specified below, and shall transmit to Licensee programming (audio and date) that it produces or owns (the “Programs”) for broadcast on the Station twenty-four (24) hours per day, seven (7) days per week.  Licensee may, at its sole discretion upon reasonable notice to Programmer, and without limitation of Licensee’s rights under Section 6 hereof, provide two (2) hours of programming during the period from 1:00 a.m. to 6:00 a.m. local time each Sunday morning (any such programming provided by Licensee, being the “Licensee Programming”).  Programmer will supply the Programs at its own cost to the Station’s facilities in a manner that meets technical and quality standards at least equal to those of the Station’s broadcasts prior to commencement of the Term and as detailed below in Section 3 hereof.

 

 

  

  

  

 

3.           Broadcasting/Signal Delivery/Access to Studio and Transmitter Site(s).

 

(a)           Subject to the provisions of Sections 2 and 6 hereof, during the Term, Licensee shall make available to Programmer the entire programming capacity of the Station for the broadcast of Programs.

 

(b)           The Programs shall originate from Programmer’s own studios or from other studios contracted for and paid for solely by Programmer. Programmer will transmit the Programs to Licensee’s studio as well as to Licensee’s main transmitter location at the Empire State Building via one backup feed, at Programmer’s expense, via a mode of transmission (e.g., satellite facilities, microwave facilities and/or telephone lines) that will ensure that the Programs’ transmission signals meet technical and quality standards substantially equal to those of the Station’s broadcasts prior to the commencement of the Term but in no event lower than the standards required at any time during the Term by the FCC Rules.  Programmer shall provide, at its expense, one or more of the following:  T1 line, ISDN, microwave T1, phone line, or IP link between its studio used to perform this Agreement and Licensee’s main studio location (currently located at 395 Hudson Street, New York, New York 10014).  Programmer shall provide the Programs consistent with FCC Rules and regulations. Licensee will make available space at the studio site, for one dedicated broadcast equipment rack (or its equivalent) along with two separate electrical circuits. This equipment rack will house Programmer’s equipment and will serve as the primary handoff point for the Programs. The secondary handoff point will be a direct connection to the Licensee’s main (Empire State Building) transmitter site via the above listed connection methods.  Licensee shall provide 24 hours a day, seven days per week access to Programmer’s equipment rack (accompanied by Licensee) for routine inspection, service and upgrades upon reasonable advance notice to Licensee.  Licensee shall provide (at the location of Programmer’s rack) access to common telephony services.  Licensee shall provide 24 hours, seven days per week required telemetry to indicate the Station’s real time total RF input via through-line, RF power monitor (which includes IP communication to Programmer) to the Master FM Antenna and associated data (for monitoring purposes only), at Licensee’s sole cost and expense.  Programmer shall have the option to adjust audio processing, stereo encoder, HD encoder at either the Licensee’s studio and/or transmitter, accompanied by Licensee upon reasonable advance notice to Licensee.  Licensee shall provide to Programmer off air confidence feeds (at the studio handoff point) of the main analog channel, HD1, HD2, and HD3.  Licensee shall, in connection with the discharge of its responsibilities hereunder continue to take all commercially reasonable actions under the rules and regulations of the FCC to protect the Station’s service areas from interference caused by signals from other stations and other sources and to keep the Station’s technical facilities in good working order and repair.

 

4.           Advertising.  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, and to all other broadcast revenues generated by the Station, including on-line advertising and other website related 

 

 

  

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revenues, but not any tower revenue.  Programmer shall ensure that its contracts for advertising and programming on the Station terminate upon termination or expiration of this Agreement.

 

5.           Payments; Guaranty.

 

(a)           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.

 

(b)           As of the date hereof, Guarantor shall enter into a Guaranty in the form of Schedule B hereto.  Upon request by Licensee, Programmer will provide the most recent available audited annual balance sheet, income statement and statement of cash flows of Guarantor calculated in accordance with United States generally-accepted accounting principles.  Licensee agrees to treat these financial statements as confidential information and to not share with third parties without a non-disclosure agreement (which confidentiality provisions may be set forth in an agreement assigning Licensee’s rights under this Agreement to an affiliate or a financing party (including the successors and/or assigns of any such financing party)); provided, however, no such non-disclosure requirement shall be required for the regulators and auditors of parties to which these financial statements are provided.

 

6.           Control.

 

(a)           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 and shall be responsible for controlling the day-to-day operations of the Station in conformance with all FCC licenses and permits, and nothing contained in this Agreement shall be construed to prevent or hinder the Licensee from retaining full and complete control over the Station, including, but not limited to, control of its finances, personnel and programming.  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 Licensee’s manager, and (3) retain control over the policies, programming and operations of the Station.

 

(b)           Nothing contained herein shall prevent Licensee from (i) rejecting or refusing programs or advertisements which Licensee in good faith believes to be contrary to the public interest, or (ii) substituting programs which Licensee in good faith 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 reserve the right to (i) refuse to broadcast any Program containing matter which violates any right of any third party 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.  Notwithstanding the foregoing, Licensee shall not exercise 

 

 

  

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their rights under this Section 6(b) for commercial advantage.  Programmer may elect to terminate this Agreement within fifteen (15) days after the end of any calendar month during which Licensee preempts or substitutes other programming for Programs supplied by Programmer during one percent (1%) or more of the total hours of Programmer programming on the Station during such calendar month (excluding Licensee Programming) by giving Licensee thirty (30) days advance notice and paying Licensee the applicable Annual Fee prorated through the termination date.

 

(c)           Programmer shall cooperate with Licensee to ensure that Emergency Alert System (“EAS”) transmissions are properly performed in accordance with Licensee’s instructions.  Licensee shall ensure that all required EAS tests shall be coordinated with the Programming in an effort not to interrupt content in compliance with all FCC Rules.   Programmer will immediately serve Licensee with notice and a copy of any letters of complaint it receives concerning any Program for review by Licensee and inclusion in the Station’s public inspection file.

 

7.           Programs.

 

(a)           Programmer shall ensure that the contents of the Programs conform to all FCC rules, regulations and policies and other applicable law, rules and regulations.  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.  Upon request by Licensee, 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 time record keeping and lowest unit charge requirements of federal law. Programmer shall release advertising availabilities to Licensee 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.

 

(c)           During the Term, subject to Section 5, Licensee and Programmer will maintain music licenses with respect to the Station and the Programs, as appropriate.

 

8.           Expenses and Contracts.

 

(a)           During the Term, Programmer will be responsible for (i) the salaries, taxes, insurance and other costs for all personnel employed by Programmer used in production of the Programs, and (ii) the costs of delivering the Programs to Licensee,.  Subject to Section 5, 

 

 

  

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Licensee will pay for its employees contemplated by Section 6, maintenance of all 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.  Subject to Section 5, Licensee will also pay for all utilities supplied to transmitter site(s).

 

(b)           Outside of the Payments detailed in Section 5, the expenses detailed in this Agreement, Programmer will not be responsible for any additional payments to Licensee or direct expenses related to execution of this Agreement.

 

9.           Format and Call Sign.  The Programs shall consist of a sports format.  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, hereby licenses to Programmer the right to use the call letters 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.

 

10.         Facilities.

 

(a)           Normal Operations.  During the Term, Licensee shall maintain and operate the Station’s transmission facilities consistent with its practices at other radio stations owned and operated by Licensee and its affiliates.  Subject to Section 10(b) below, no failure to broadcast or deliver the Programs due to facility damage, repair or maintenance or due to any reason outside either party’s reasonable control shall be deemed a failure by either party to comply with this Agreement.  Licensee shall replace its existing primary transmitter site (currently Empire State Building) analog and digital transmitters and studio transmitter links with new transmitters and links prior to the beginning of Contract Year six (6). Licensee shall cooperate with Programmer to provide commercially reasonable remote access to monitor the new transmitters..  Additionally, Licensee agrees to make appropriate upgrades to equipment as mutually agreed to maintain industry standards.

 

(b)           Interruption of Normal Operations.  If during the Term, the Station suffers any loss or damage of any nature to its main transmission facilities which results in the interruption of service or the inability of the Station to operate with its maximum authorized facilities (including downtime occasioned by routine maintenance not to exceed two (2) hours per month between 12:30 a.m. and 5:00 a.m. local time), Licensee shall promptly notify Programmer, and Licensee shall undertake such repairs as are necessary to restore full-time operation of the Station with its maximum authorized facilities (from the Empire State Building) as expeditiously as possible following the occurrence of any such loss or damage.  In the event that the Station is Off-Air (as defined below) due to a technical problem  for more than an aggregate of ten (10) hours in any calendar month (“Allowable Off-Air Time”) during the Term, the Annual Fee payable to the Licensee pursuant to Section 5 hereof shall be reduced in the amount equal to Ten Thousand Dollars ($10,000) per hour for each hour or part thereof in excess of the monthly Allowable Off-Air Time during which the Station is Off-Air (the “Off-Air 

 

 

  

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Proration”).  For the purposes of this Section 10(b), the term “Off-Air” shall mean (i) failure to operate/broadcast the Programs due to a technical problem not caused by Programmer or (ii), after 24 hours of such operation, operation at the Empire State Building ERI Master FM antenna at less than seventy five percent (75%) of its FCC licensed Empire State Building ERI Master FM antenna input power parameters . Notwithstanding the foregoing, in the event that broadcast of the Programs from the Empire State Building ERI Master FM antenna is rendered impossible by a Force Majeure Event, as long as Licensee broadcasts from its West Orange, New Jersey auxiliary antenna (or its broadcast equivalent) at an effective radiated power of 26.55 kilowatts, (x) the Off-Air Proration shall not apply, (y) the Term shall be extended on a day-for-day basis at no additional fee, and (z) Programmer shall continue to pay the fees set forth in Schedule A in the amounts and at the times set forth herein.  If  Programmer or any of its agents or employees cause any damages to any of the Station facilities, Programmer shall promptly provide Licensee with notice of such damage and shall repair such damage at Programmer’s expense or shall reimburse Licensee for the cost of repairing any such damage, and any time during which the Station is Off-Air due to damage caused by Programmer or any of its agents or employees shall not be counted against Licensee’s Allowable Off-Air Time or be subject to a reduction in the Annual Fee.  “Force Majeure Event” means any event beyond the affected party's reasonable control prohibiting broadcasts from the Empire State Building, including, without limitation: (a) acts of God; (b) flood, fire, or earthquake; (c) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (d) government order or law; or (e) action by any governmental authority; (g) national or regional emergency.

 

11.         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.

 

12.         Termination.

 

(a)           This Agreement shall terminate as of 11:59 p.m. E.T. on August 30, 2024, unless earlier terminated in accordance herewith.

 

(b)           Licensee may terminate this Agreement upon written termination notice to Programmer if: (i) Programmer fails to timely make any payment when due under this Agreement; or (ii) there is a material default by Programmer under this Agreement, which is not cured within the Cure Period.  Programmer may terminate this Agreement upon written termination notice to Licensee if there is a material default by Licensee under this Agreement, which is not cured within the Cure Period.  Any such termination shall become effective upon expiration of the Cure Period.

 

 

  

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(c)           The term “Cure Period” means a period commencing on the date the breaching party receives written notice from the other of a breach or default hereunder and continuing until the date thirty (30) calendar days thereafter except for a default in payment of the fees set forth in Schedule A for which the cure period shall be five (5) business days.  If this Agreement is terminated for any reason, 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.

 

(d)           The parties’ obligations under Section 13 shall survive any termination of this Agreement or expiration of the Term.

 

13.         Indemnification.  Programmer shall indemnify and hold Licensee, its officers, directors, members, partners, affiliates and employees harmless against any and all loss, liability, cost and expense (including reasonable attorneys’ fees) arising from (i) 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, or (ii) any material breach or default by Programmer under this Agreement.  Licensee shall indemnify and hold Programmer, its officers, directors, members, partners, affiliates and employees harmless against any and all loss, liability, cost and expense (including reasonable attorneys’ fees) arising from any material breach or default by Licensee under this Agreement.  Whenever any claim shall arise for indemnification hereunder, the party entitled to indemnification (the “Indemnified Party”) shall promptly provide written notice of such claim to the other party (the “Indemnifying Party”). In connection with any claim giving rise to indemnity hereunder resulting from or arising out of any claim, action, suit, proceeding or governmental investigation (“Action”) by a person or entity who is not a party to this Agreement, the Indemnifying Party, at its sole cost and expense and upon written notice to the Indemnified Party, may assume the defense of any such Action with counsel reasonably satisfactory to the Indemnified Party. The Indemnified Party shall be entitled to participate in the defense of any such Action, with its counsel and at its own cost and expense. If the Indemnifying Party does not assume the defense of any such Action, the Indemnified Party may, but shall not be obligated to, defend against such Action in such manner as it may deem appropriate, including, but not limited to, settling such Action, after giving notice of it to the Indemnifying Party, on such terms as the Indemnified Party may deem appropriate and no action taken by the Indemnified Party in accordance with such defense and settlement shall relieve the Indemnifying Party of its indemnification obligations herein provided with respect to any damages resulting therefrom. The Indemnifying Party shall not settle any Action without the Indemnified Party's prior written consent (which consent shall not be unreasonably withheld or delayed).

 

14.         Assignment and Pledging.

 

(a)           Licensee may transfer or assign this Agreement (directly or indirectly) to one of its commonly controlled entities or any successor-in-interest to Licensee with respect to 

 

 

  

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ownership of the Station and its FCC license, in its sole discretion.  For further clarity, Licensee shall not transfer the Station’s assets or FCC license unless Licensee assigns this Agreement to the transferee and the transferee agrees to assume Licensee’s obligations hereunder.  Licensee may pledge its rights under this Agreement as collateral for a secured financing.  In connection with such a pledge of this Agreement as collateral, Programmer hereby agrees to provide promptly upon Licensee’s request  an estoppel certificate in the form of Schedule C to this Agreement (to the extent the statements in such estoppel certificate are true and correct to Programmer’s knowledge) effective as of the date requested by Licensee.

 

(b)           Programmer may not assign this Agreement without the prior written consent of Licensee.  Notwithstanding the foregoing, Programmer shall be entitled to assign this Agreement to one of its commonly-controlled entities with an FCC license, provided that such affiliate agrees to assume all of Programmer’s obligations hereunder.

 

(c)           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; provided, however, upon Licensee’s assignment of its rights and obligations under this Agreement to a commonly-controlled special purpose financing subsidiary in connection with an assignment of the Station’s FCC license and assets to that subsidiary, the assigning Licensee shall be fully relieved of its obligations hereunder.  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.

15.         Severability.  If this Agreement conflicts with FCC rules, regulations and policies in any material respect and the terms hereof can be modified so as to comply with such rules, regulations and policies without depriving either party of the benefits of this Agreement in any material respect, then the parties shall modify this Agreement in such manner.  In the event that the Agreement cannot be so modified, the parties agree to negotiate in good faith to attempt to modify the Agreement to accommodate the interests of both parties in compliance with FCC rules, regulations and policies.  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.

16.         Notice.  All notices, requests, consents and other communications, required or permitted to be given hereunder, shall be made in writing and shall be deemed to have been made as of: (a) the date that is the next date upon which an overnight delivery service (Federal Express or UPS only) will make such delivery, if sent via such overnight delivery service for next day delivery, postage prepaid, (b) the date such delivery is made, if delivered in person to the notice party specified below, or (c) the date such delivery is made, if delivered via email or facsimile, so long as such notice is also sent via overnight delivery service the same day.   Such notice shall be delivered as follows (or to such other or additional address as either party shall designate by notice in writing to the other in accordance herewith):

 

 

  

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                      If to Licensee:

                      Emmis Radio License Corporation of New York

                      40 Monument Circle, Suite 700

                      Indianapolis, Indiana 46204

                      Attn: Legal Department

                      Email: legal@emmis.com

                      If to Programmer:

New York AM Radio Assets, LLC

77 West 66th Street

New York, New York 10023

Attn: Traug Keller / SVP Production Business Division

Email:  traug.f.keller@espn.com

with a copy (which shall not constitute notice) to:

                      ABC, Inc.

                      77 West 66th Street

                      New York, New York 10023

                      Facsimile Number:  (212) 456-6202

                      Attention:  Corporate Legal Department

17.         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.  This Agreement may be executed by facsimile or electronically-delivered signature and a facsimile or electronically-delivered signature shall constitute an original for all purposes.  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, or to afford any rights to any third party other than as expressly provided herein.  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 New York without giving effect to the choice of law provisions thereof.  This Agreement (including Schedule A 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.

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

 

19.         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 Stations on the basis of race or gender, and all 

 

 

  

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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 Stations, and if requested shall provide written confirmation of compliance with such requirement.

20.         Exclusive Negotiations.  In the event Programmer gives Licensee notice of its desires to extend the Term of this Agreement, Licensee agrees to commence on or before the beginning of Year 10, good faith negotiations of the terms and provisions of such extension (an “Extension Agreement”) exclusively with Programmer. In the event the parties are unable to reach an Extension Agreement by twelve (12) months prior to the expiration of the Term, then Licensee may enter into negotiations with third parties to program the Station, provided that Licensee shall not enter into an agreement during the Term for a third party to program the Station that contains terms less advantageous to Licensee, taken as a whole, than those contained in Programmer’s proposal without first offering to enter into an Extension Agreement on the terms of such proposal.

[SIGNATURE PAGE FOLLOWS]

 

 

  

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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.

 

	PROGRAMMER:	NEW YORK AM RADIO, LLC	 
	 	 	 	 
	
 

	
By: 

	/s/ Traug Keller	 
	 	 	Name:  Traug Keller	 
	 	 	Title:    Senior Vice President	 
	 	 	 	 

	LICENSEE:	
EMMIS RADIO LICENSE CORPORATION

OF NEW YORK

	 
	 	 	 	 
	
 

	
By: 

	/s/ Patrick M. Walsh	 
	 	 	Name:  Patrick M. Walsh	 
	 	 	Title:    EVP, COO & CFO

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