Time Brokerage Agreement

TIME BROKERAGE AGREEMENT


This Time Brokerage Agreement (this "Agreement") is made as of this 4th day of June, 2002, effective for all purposes on the Effective Date (as defined below), between ENTRAVISION COMMUNICATIONS CORPORATION, a Delaware corporation ("Programmer"), and KTCY LICENSING, INC., a Delaware corporation ("Licensee").


Recitals


WHEREAS, Licensee holds a license issued by the Federal Communications Commission (the "FCC") for operation of Station KTCY(FM), Pilot Point, Texas (the "Station");


WHEREAS, Licensee, Programmer and Spanish Broadcasting System, Inc. ("Spanish Broadcasting") have contemporaneously entered into an Asset Purchase Agreement (the "Purchase Agreement"), which provides for the acquisition by Programmer of certain assets and liabilities of Licensee and Spanish Broadcasting on the terms and subject to the conditions set forth therein; and


WHEREAS, between the date hereof and the closing under the Purchase Agreement, Programmer desires to broker certain air time on the Station, all in accordance with the Communications Act of 1934, as amended, and the rules, regulations, and policies of the FCC (the "FCC Requirements").


NOW, THEREFORE, in consideration of the foregoing premises and of the mutual covenants, representations, warranties and agreements contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement agree as follows:


1. Effective Date and Term.


1.1 Effective Date. This Agreement shall become effective for all purposes on the date hereof (the "Effective Date").


1.2 Term. The term of this Agreement (the "Term") shall begin on the Effective Date and shall continue until the consummation of the transaction under the Purchase Agreement, unless earlier terminated under the provisions of this Agreement.


2. Brokering of Air Time. Programmer hereby agrees to broker certain air time on the Station during the Term (such brokered air time period is referred to herein as the "Broadcasting Period"). During the Broadcasting Period, Licensee shall broadcast on the Station programming supplied by Programmer (the "Programming"). Programmer will ensure that the Programming meets technical and quality standards equal to those of programming broadcast by commercial radio stations generally in the United States. If Licensee, in the reasonable exercise


of its discretion, finds that the Programming does not meet such standards, then it shall advise Programmer in writing of the specific deficiencies. If such deficiencies have not been corrected within ten (10) days after receipt of notice, then Licensee shall have no obligation to continue broadcast such Programming until such time as the deficiencies are corrected.


3. Licensee's Broadcasting Obligations. In consideration for the payments made and to be made by Programmer hereunder, Licensee shall make available to Programmer, beginning on the Effective Date, all of the Station's air time (except for such time necessary for Licensee to meet its obligations under the rules and regulations of the FCC) during the Broadcasting Period and shall cause to be broadcast on the Station the Programming pursuant to Section 2 hereof. Throughout the Term, unless otherwise mutually agreed by the parties, Licensee shall maintain the operating power of the Station at its authorized maximum licensed level and shall operate and maintain in good working condition the Station's transmission facilities and broadcasting equipment. Licensee shall use its best efforts to provide at least forty-eight (48) hours' prior notice to Programmer in advance of any maintenance work affecting the operation of the Station, and such work shall be scheduled by Licensee to be performed at such hours and on such terms as to minimize interruption of broadcast of the Programming on the Station. If the Station suffers any loss or damage to its facilities which results in interruption of the ability to broadcast the Programming at the maximum authorized power for the Station, Licensee shall notify Programmer as soon as reasonably possible, and immediately undertake such repairs as are necessary to restore full-time operation of the Station at its maximum authorized power level. Throughout the Term, Licensee shall also, with respect to the Station:


(a) employ a General Manager who will report to Licensee and direct the performance of Licensee's obligations hereunder and who shall have no employment, consulting or other material relationship with Programmer;


(b) employ at least one other person on a full-time basis to assist the General Manager in performing Licensee's obligations hereunder, who shall have no employment, consulting, or other material relationship with Programmer;


(c) retain ultimate control over the personnel, finances, programming and operation of the Station;


(d) maintain a main studio consistent with the FCC Requirements at which the General Manager and other employee(s) (collectively, the "Station Employees") of Licensee will be available during normal business hours;


(e) comply with the FCC Requirements with respect to the ascertainment of community problems, needs and interests;


(f) broadcast, without selling advertising associated therewith, programming responsive thereto;


(g) timely prepare and place in the Station's public inspection files appropriate


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documentation thereof; and


(h) comply with all other FCC Requirements which may be applicable to the operation of the Station, including a station operating under a time brokerage arrangement.


4. Operation, Ownership and Control of the Station.


4.1 Control Vested to Licensee. Notwithstanding anything to the contrary in this Agreement, as long as Licensee remains the FCC licensee of the Station, Licensee will have full authority, power and control over the operation of the Station and over all persons employed by it. Licensee will bear the responsibility for the Station's compliance with, and shall cause the Station to comply with, all applicable laws, including the FCC Requirements. Nothing contained herein shall prevent or hinder Licensee from: (a) rejecting or refusing Programming that Licensee believes in good faith to be unsuitable or contrary to the public interest; (b) substituting programs which Licensee believes in good faith to be of greater local or national importance or which are designed to address the problems, needs and interests of the local community; (c) preempting any Programming in the event of a local, territorial or national emergency; (d) refusing to broadcast any Programming that does not meet the FCC Requirements; or (e) deleting any commercial announcements that do not comply with the FCC Requirements or the requirements of the Federal Trade Commission, or any state, local or federal law.


4.2 Notice of Complaints. Programmer will immediately serve Licensee with notice and a copy of any letters of complaint that Programmer receives concerning the Programming, for Licensee's review and inclusion in its public inspection files. Licensee will immediately serve Programmer with notice and a copy of any letters of complaint that it receives concerning the Programming.


4.3 Programmer Access to the Station's Studio and Transmitter. During the Term, Licensee shall make available to Programmer, for no additional consideration, the areas in the Station's studio and transmitter sites as may be reasonably necessary or appropriate for Programmer to exercise its rights and perform its obligations under this Agreement.


4.4 Employees. Programmer shall employ and be responsible for the compensation, benefits, taxes, insurance, and related costs for all personnel it uses in the production of the Programming supplied to the Station hereunder, and all other costs incurred by Programmer for the production of such Programming. The Station Employees described in Section 3 above shall remain in Licensee's sole employ and control throughout the Term. Licensee shall pay all compensation, benefits (including, without limitation, all accrued vacation, sick leave and other employee benefits), taxes, insurance, and related costs owed to its Station Employees during the Term of this Agreement.


4.5 Mutual Cooperation. Programmer and Licensee agree to cooperate reasonably with each other as necessary to fulfill their rights and obligations hereunder.


5. Program Rights and Music Licenses. All music supplied by Programmer as


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part of the Programming shall be: (i) licensed by Programmer under agreements between Programmer and ASCAP, SESAC or BMI; (ii) in the public domain; or (iii) cleared at the source by Programmer. The right to use the Programming and to authorize its use in any manner shall be and remain vested in Programmer. Licensee shall maintain all necessary performing rights licenses to musical compositions included in any programming that is produced by Licensee.


6. Programming to Serve the Public Interest. Licensee acknowledges that it is familiar with the type of programming Programmer intends to provide and has determined that the broadcast of the Programming on the Station will not be detrimental to the public interest and is otherwise suitable.


7. Programming Standards. Programmer shall ensure that the Programming conforms to all FCC Requirements applicable to broadcast radio stations.


8. Expenses, Revenues ...