0001104659-07-036769.txt : 20070508 0001104659-07-036769.hdr.sgml : 20070508 20070508093137 ACCESSION NUMBER: 0001104659-07-036769 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20070331 FILED AS OF DATE: 20070508 DATE AS OF CHANGE: 20070508 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ENTERCOM COMMUNICATIONS CORP CENTRAL INDEX KEY: 0001067837 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 231701044 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-14461 FILM NUMBER: 07826343 BUSINESS ADDRESS: STREET 1: 401 CITY AVENUE STREET 2: SUITE 809 CITY: BALA CYNWYD STATE: PA ZIP: 19004 BUSINESS PHONE: 610-660-5610 MAIL ADDRESS: STREET 1: 401 CITY AVENUE STREET 2: SUITE 809 CITY: BALA CYNWYD STATE: PA ZIP: 19004 10-Q 1 a07-10631_110q.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the quarterly period ended March 31, 2007

		or

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number:

001-14461

Entercom Communications Corp.

(Exact name of registrant as specified in its charter)

Pennsylvania		23-1701044
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification no.)

401 City Avenue, Suite 809

Bala Cynwyd, Pennsylvania 19004

(Address of principal executive offices and zip code)

(610) 660-5610

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.

Large accelerated filer x Accelerated filer o Non-accelerated filer o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class A common stock, $.01 par value – 32,410,316 Shares Outstanding as of May 1, 2007

Class B common stock, $.01 par value – 8,046,805 Shares Outstanding as of May 1, 2007

ENTERCOM COMMUNICATIONS CORP.

INDEX

Part I Financial Information		1

Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	34

Part II Other Information		35

Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35
Item 3.	Defaults Upon Senior Securities	36
Item 4.	Submission of Matters to a Vote of Security Holders	36
Item 5.	Other Information	36
Item 6.	Exhibits	37

Signatures		38

Exhibit Index		39

Private Securities Litigation Reform Act Safe Harbor Statement

This report contains, in addition to historical information, statements by us with regard to our expectations as to financial results and other aspects of our business that involve risks and uncertainties and may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

Forward-looking statements are presented for illustrative purposes only and reflect our current expectations concerning future results and events. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, without limitation, any projections of earnings, revenues or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing.

You can identify forward-looking statements by our use of words such as “anticipates,” “believes,” “continues,” “expects,” “intends,” “likely,” “may,” “opportunity,” “plans,” “potential,” “project,” “will,” and similar expressions which identify forward-looking statements, whether in the negative or the affirmative. We cannot guarantee that we actually will achieve these plans, intentions or expectations. These forward-looking statements are subject to risks, uncertainties and other factors, some of which are beyond our control, which could cause actual results to differ materially from those forecasted or anticipated in such forward-looking statements. You should not place undue reliance on these forward-looking statements, which reflect our view only as of the date of this report. We undertake no obligation to update these statements or publicly release the result of any revision(s) to these statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.

Key risks to our company are described in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 28, 2007 and as may be supplemented by the risks described herein under Part II, Item 1A, of our quarterly reports on Form 10-Q.

PART I

FINANCIAL INFORMATION

ITEM 1. Financial Statements

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

MARCH 31, 2007 AND DECEMBER 31, 2006

(amounts in thousands)

(unaudited)

ASSETS

	MARCH 31,			DECEMBER 31,
	2007			2006
CURRENT ASSETS:
Cash and cash equivalents	$	10,751		$	10,795
Accounts receivable, net of allowance for doubtful accounts	78,618			90,263
Prepaid expenses and deposits	10,635			6,575
Prepaid and refundable income taxes	14,233			7,325
Deferred tax assets	2,822			3,383
Total current assets	117,059			118,341

INVESTMENTS	3,894			4,867

PROPERTY AND EQUIPMENT:
Land, land easements and land improvements	14,514			14,514
Buildings	21,289			21,186
Equipment	113,520			112,020
Furniture and fixtures	14,956			14,949
Leasehold improvements	15,532			15,528
	179,811			178,197
Accumulated depreciation	(97,260		)	(93,408		)
	82,551			84,789
Capital improvements in progress	4,763			3,243
Net property and equipment	87,314			88,032

RADIO BROADCASTING LICENSES - Net	1,351,389			1,351,389

GOODWILL - Net	157,242			157,242

DEFERRED CHARGES AND OTHER ASSETS - Net	13,215			13,387

TOTAL	$	1,730,113		$	1,733,258

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

MARCH 31, 2007 AND DECEMBER 31, 2006

(amounts in thousands)

(unaudited)

LIABILITIES AND SHAREHOLDERS’ EQUITY

	MARCH 31,			DECEMBER 31,
	2007			2006
CURRENT LIABILITIES:
Accounts payable	$	672		$	1,239
Accrued expenses	20,119			22,612
Accrued liabilities:
Salaries	6,705			8,097
Interest	1,877			4,661
Advertiser obligations and other commitments	1,457			1,788
Other	3,492			3,909
Current portion of long-term debt	20			20
Total current liabilities	34,342			42,326

LONG-TERM LIABILITIES:
Senior debt	545,214			526,219
7.625% senior subordinated notes	150,000			150,000
Deferred tax liabilities	238,600			229,205
Other long-term liabilities	10,690			8,416
Total long-term liabilities	944,504			913,840
Total liabilities	978,846			956,166

COMMITMENT AND CONTINGENCIES

SHAREHOLDERS’ EQUITY:
Preferred stock	—			—
Class A, B and C common stock	404			404
Additional paid-in capital	634,096			641,889
Retained earnings	116,858			134,655
Accumulated other comprehensive income (loss)	(91		)	144
Total shareholders’ equity	751,267			777,092

TOTAL	$	1,730,113		$	1,733,258

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2007 AND 2006

(amounts in thousands, except share and per share data)

(unaudited)

	THREE MONTHS ENDED
	MARCH 31,
	2007			2006

NET REVENUES	$	100,022		$	91,135

OPERATING (INCOME) EXPENSE:
Station operating expenses, including non-cash compensation expense of $519 in 2007 and $61 in 2006	68,374			59,566
Depreciation and amortization	4,090			3,923
Corporate general and administrative expenses, including non-cash compensation expense of $1,332 in 2007 and $210 in 2006	7,700			5,961
Time brokerage agreement fees	4,040			—
Net (gain) loss on sale or disposal of assets	118			(125		)
Total operating expense	84,322			69,325
OPERATING INCOME	15,700			21,810

OTHER (INCOME) EXPENSE:
Interest expense, including amortization of deferred financing costs of $402 in 2007 and $329 in 2006	12,040			9,684
Interest and dividend income	(184		)	(159		)
Net gain on derivative instruments	(30		)	(296		)
Gain on investments	(75		)	—
TOTAL OTHER EXPENSE	11,751			9,229

INCOME BEFORE INCOME TAXES	3,949			12,581
INCOME TAXES	4,513			4,826

NET INCOME (LOSS)	$	(564	)	7,755

NET INCOME (LOSS) PER SHARE - BASIC AND DILUTED	$	(0.01	)	$	0.19

DIVIDENDS DECLARED AND PAID PER COMMON SHARE	$	0.38		$	0.38

WEIGHTED AVERAGE SHARES:
Basic	39,386,939			41,343,973
Diluted	39,386,939			41,467,678

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

THREE MONTHS ENDED MARCH 31, 2007 AND 2006

(amounts in thousands)

(unaudited)

	THREE MONTHS ENDED
	MARCH 31,
	2007			2006

NET INCOME (LOSS)	$	(564	)	$	7,755

OTHER COMPREHENSIVE LOSS, NET OF TAX BENEFIT:
Unrealized loss on investments, net of a tax benefit of $119 in 2007 and $194 in 2006	(235		)	(307		)

COMPREHENSIVE INCOME (LOSS)	$	(799	)	$	7,448

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

THREE MONTHS ENDED MARCH 31, 2007 AND YEAR ENDED DECEMBER 31, 2006

(amounts in thousands, except share data)

(unaudited)

																				Accumulated
	Common Stock										Additional			Retained						Other
	Class A					Class B					Paid-in			Earnings			Unearned			Comprehensive
	Shares		Amount			Shares		Amount			Capital			(Deficit)			Compensation			Income			Total

Balance, December 31, 2005	34,610,114		$	346		8,271,805		$	82		$	738,384		$	148,141		$	(2,242	)	$	1,004		$	885,715
Net income	—		—			—		—			—			47,981			—			—			47,981
Reclassification of unearned compensation	—		—			—		—			(2,242		)	—			2,242			—			—
Conversion of Class B common stock to Class A common stock	225,000		2			(225,000	)	(2		)	—			—			—			—			—
Compensation expense related to granting of stock options	—		—			—		—			115			—			—			—			115
Compensation expense related to granting of restricted stock	969,501		11			—		—			4,977			—			—			—			4,988
Issuance of common stock related to an incentive plan	21,696		—			—		—			579			—			—			—			579
Exercise of stock options	21,334		—			—		—			540			—			—			—			540
Tax benefit adjustment related to option exercises	—		—			—		—			—			—			—			—			—
Common stock repurchase	(3,468,300	)	(35		)	—		—			(100,464		)	—			—			—			(100,499		)
Payments of dividends of $1.52 per common share	—		—			—		—			—			(60,448		)	—			—			(60,448		)
Accrued dividends on restricted stock units	—		—			—		—			—			(1,019		)	—			—			(1,019		)
Net unrealized loss on investments	—		—			—		—			—			—			—			(860		)	(860		)
Balance, December 31, 2006	32,379,345		324			8,046,805		80			641,889			134,655			—			144			777,092
Net loss	—		—			—		—			—			(564		)	—			—			(564		)
Accounting change, net of taxes	—		—			—		—			—			(1,850		)	—			—			(1,850		)
Compensation expense related to granting of stock options	—		—			—		—			7			—			—			—			7
Compensation expense related to granting of restricted stock	399,482		4			—		—			2,887			—			—			—			2,891
Issuance of common stock related to an incentive plan	5,071		—			—		—			141			—			—			—			141
Exercise of stock options	17,001		—			—		—			419			—			—			—			419
Tax benefit adjustment related to option exercises	—		—			—		—			20			—			—			—			20
Common stock repurchase	(353,305	)	(4		)	—		—			(9,996		)	—			—			—			(10,000		)
Purchase of vested employee restricted stock units	(41,933	)	—			—		—			(1,271		)	—			—			—			(1,271		)
Payments of dividends	—		—			—		—			—			(14,931		)	—			—			(14,931		)
Accrued dividends on restricted stock units	—		—			—		—			—			(452		)	—			—			(452		)
Net unrealized loss on investments	—		—			—		—			—			—			—			(235		)	(235		)
Balance, March 31, 2007	32,405,661		$	324		8,046,805		$	80		$	634,096		$	116,858		$	—		$	(91	)	$	751,267

See notes to consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2007 AND 2006

(amounts in thousands)

(unaudited)

	THREE MONTHS ENDED
	MARCH 31,
	2007			2006

OPERATING ACTIVITIES:
Net income (loss)	$	(564	)	$	7,755
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (includes amortization of station operating expenses of $2 in 2007)	4,092			3,923
Amortization of deferred financing costs	402			329
Deferred taxes	11,158			9,274
Tax benefit on exercise of options	20			11
Provision for bad debts	761			496
(Gain) loss on sale or disposal of assets	118			(125		)
Non-cash stock-based compensation expense	1,851			271
Gain on investments	(75		)	—
Net gain on derivative instruments	(30		)	(296		)
Deferred rent	(55		)	51
Unearned revenue - long-term	(9		)	(9		)
Deferred compensation	429			367
Tax benefit for vesting of restricted stock unit awards	(1,062		)	—
Changes in assets and liabilities (net of effects of acquisitions and dispositions):
Accounts receivable	10,886			7,233
Prepaid expenses and deposits	(4,060		)	(2,115		)
Prepaid and refundable income taxes	(6,908		)	(4,741		)
Accounts payable and accrued liabilities	(8,321		)	(8,645		)
Net cash provided by operating activities	8,633			13,779

INVESTING ACTIVITIES:
Additions to property and equipment	(3,277		)	(3,749		)
Proceeds from sale of property, equipment, intangibles and other assets	14			216
Deferred charges and other assets	(159		)	(68		)
Purchases of investments	—			(44		)
Proceeds from investments	694			—
Station acquisition deposits and costs	(249		)	612
Net cash used in investing activities	(2,977		)	(3,033		)

FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt	27,500			86,000
Payments of long-term debt	(8,505		)	(8,005		)
Proceeds from issuance of stock under the employee stock plan	120			153
Purchase of the Company’s common stock	(10,000		)	(77,216		)
Purchase of vested restricted stock units	(1,271		)	—
Proceeds from the exercise of stock options	419			247
Payment of dividend equivalents on vested restricted stock units	(94		)	—
Payment of cash dividends	(14,931		)	(15,392		)
Tax benefit for vesting of restricted stock awards	1,062			—
Net cash used in financing activities	(5,700		)	(14,213		)

NET DECREASE IN CASH AND CASH EQUIVALENTS	(44		)	(3,467		)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	10,795			16,071
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	10,751		$	12,604

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2007 AND 2006

(amounts in thousands, except share data)

(unaudited)

	THREE MONTHS ENDED
	MARCH 31,
	2007		2006

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	38,376	$	11,982
Income taxes paid	$	174	$	52

SUPPLEMENTAL DISCLOSURES ON NON-CASH INVESTING AND FINANCING ACTIVITIES -

In connection with the issuance of 0.4 million restricted stock units (net of forfeitures) during the three months ended March 31, 2007, the Company will increase its paid in capital in the amount of $11.6 million over the vesting period of the restricted stock units.

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2007 AND 2006

1. BASIS OF PRESENTATION

The condensed consolidated interim unaudited financial statements included herein have been prepared by Entercom Communications Corp. and its subsidiaries (collectively, the “Company”) in accordance with: (i) generally accepted accounting principles for interim financial information; and (ii) the instructions of the Securities and Exchange Commission (the “SEC”) for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, the financial statements reflect all adjustments considered necessary for a fair statement of the results of operations and financial position for the interim periods presented. All such adjustments are of a normal, recurring nature. The Company’s results are subject to seasonal fluctuations and, therefore, the results shown on an interim basis are not necessarily indicative of results for a full year.

This Form 10-Q should be read in conjunction with the financial statements and notes thereto included in the Company’s audited financial statements as of and for the year ended December 31, 2006 and filed with the SEC on February 28, 2007, as part of the Company’s Annual Report on Form 10-K.

Principles Of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Entercom Communications Corp. and its subsidiaries, all of which are wholly-owned. All inter-company transactions and balances have been eliminated in consolidation. The Company also considers the applicability of Financial Accounting Standards Board (“FASB”) Financial Interpretation No. (“FIN”) 46R (as revised), “Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51,” which would include any variable interest entities that are required to be consolidated by the primary beneficiary.

Reportable Segment

The Company operates under one reportable business segment, radio broadcasting, for which segment disclosure is consistent with the management decision-making process that determines the allocation of resources and the measuring of performance.

Use Of Estimates

The Company makes estimates and assumptions that affect the amounts reported in the financial statements and the disclosures made in the accompanying notes. The Company uses estimates to determine the remaining economic lives and carrying values of property and equipment and other definite-lived intangible assets. The Company estimates the fair value of the Company’s radio broadcasting licenses and goodwill for purposes of testing for impairment. The Company also uses assumptions when employing the Black-Scholes valuation model to estimate the fair value of stock options and lattice models for certain restricted stock units (see Note 2). Actual results may differ from the Company’s estimates.

Recent Accounting Pronouncements

FAS No. 159

In February 2007, the FASB issued Financial Accounting Standard (“FAS”) No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities — Including an Amendment of FASB Statement No. 115.” FAS 159 permits an entity to elect fair value as the initial and subsequent measurement attribute for many financial assets and liabilities. Entities electing the fair value option would be required to recognize changes in fair value in earnings. Entities electing the fair value option are required to distinguish, on the face of the statement of financial position, the fair value of assets and liabilities for which the fair value option has been elected and similar assets and liabilities measured using another measurement attribute. FAS 159 is effective for the Company as of January 1, 2008. The adjustment to reflect the difference between the fair value and the carrying amount would be accounted for as a cumulative-effect adjustment to retained earnings as of the date of initial adoption. The Company is currently evaluating the impact, if any, of FAS 159 on the Company’s financial position, results of operations or cash flows.

FAS No. 157

On September 15, 2006, the FASB issued FAS No. 157, “Fair Value Measurements,” which provides guidance for using fair value to measure assets and liabilities. The standard also responds to investors’ requests for more information about: (1) the extent to which companies measure assets and liabilities at fair value; (2) the information used to measure fair value; and (3) the effect that fair value measurements have on earnings. SFAS No. 157 applies whenever another standard requires (or permits) assets or liabilities to be measured at fair value. The standard does not expand the use of fair value to any new circumstances. SFAS No. 157 is effective for the Company as of January 1, 2008. The Company is currently evaluating SFAS No. 157 and its potential effect on the Company’s financial position, results of operations or cash flows.

FIN 48

2. SHARE-BASED COMPENSATION

Under the Entercom Equity Compensation Plan (the “Plan”), the Company may issue up to 10.0 million shares of Class A common stock, which amount is increased by 1.5 million shares, or a lesser number as may be determined by the Company’s Board of Directors, on January 1 of each subsequent year. The January 1, 2007 increase, however, did not occur since the Company’s Board of Directors determined on November 16, 2006, that no additional shares would be added to the Plan. In addition, as a result of a March 23, 2006 amendment to the Plan in connection with the Option Exchange Program (the “OEP”), as described below, the number of shares that can be issued under the Plan was effectively reduced by 3.6 million. As of March 31, 2007, 2.1 million shares are available for future grant. The Plan allows for certain employees, directors and consultants to receive share-based compensation awards. The restricted stock units and options that have been issued vest over periods of up to four years. The options expire ten years from the date of grant. The Company issues new shares upon the exercise of stock options and the issuance of restricted stock (or restricted stock units).

Restricted Stock Units

Based upon trends in long-term compensation awards and market conditions, the Company modified its approach towards equity compensation awards issued to certain of its employees by granting restricted stock units in lieu of stock options. The fair value of restricted stock units with service conditions is estimated based on the market value stock price on the date of the grant, and the fair value of restricted stock units with service and market conditions is estimated using a lattice model as described below.

During the three months ended March 31, 2007, the Company issued 0.4 million restricted stock units (net of forfeitures) at a weighted average fair value of $29.10 and will increase its additional paid-in capital by $11.6 million over the vesting period of the restricted stock units. During the three months ended March 31, 2006, the Company did not issue any restricted stock units.

As of March 31, 2007, there was $22.2 million of unamortized compensation expense, net of estimated forfeitures, related to unvested restricted stock units, which is expected to be recognized over a remaining weighted-average recognition period of 1.6 years. During the three months ended March 31, 2007 and 2006, 152,864 units and 38 units, respectively, of restricted stock were both vested and released.

A summary of the Company’s outstanding restricted stock units as of March 31, 2007, and changes in restricted stock units during the three months ended March 31, 2007, is as follows:

					Weighted-	Aggregate
	Number of		Weighted-		Average	Intrinsic
	Restricted		Average		Remaining	Value As Of
	Stock		Purchase		Contractual	March 31,
	Units		Price		Term	2007

Restricted stock units outstanding as of December 31, 2006	1,072,687		$	—
Restricted stock units awarded	424,831		—
Restricted stock units released	(152,864	)	—
Restricted stock units forfeited	(25,349	)	—
Restricted stock units outstanding as of March 31, 2007	1,319,305		$	—	2.1	$	37,178,015

Restricted stock units expected to vest	1,261,533		$	—	2.0	$	35,550,005
Restricted stock units exercisable (vested and deferred)	4,410		$	—	0.0	$	124,274
Weighted average remaining recognition period in years	1.6

Recognized Non-Cash Compensation Expense

Stock-based compensation expense recognized under SFAS No. 123R for the three months ended March 31, 2007 was $1.9 million, which primarily consisted of awards of restricted stock units. Stock-based compensation expense recognized under SFAS No. 123R for the three months ended March 31, 2006 was $0.3 million, which consisted of: (1) $0.2 million for awards of restricted stock units; and (2) $0.1 million for stock-based compensation expense related to employee stock options and employee stock purchases. In connection with the recognition of this expense, the Company recorded an income tax benefit of $0.5 million and $0.1 million for the three months ended March 31, 2007 and 2006, respectively. The income tax benefits were reduced to reflect limitations for tax purposes on deductible compensation for certain key employees.

The following table summarizes recognized stock-based compensation expense related to employee stock options, employee stock purchase plan purchases and awards of restricted stock units for the three months ended March 31, 2007 and 2006:

	Three Months Ended
	March 31,
	2007			2006
	(amounts in thousands)

Station operating expenses	$	519		$	61
Corporate general and administrative expenses	1,332			210
Stock-based compensation expense included in operating expenses	1,851			271
Tax benefit	(535		)	(105		)
Recognized stock-based compensation expense related to employee stock options, employee stock purchase plan purchases and restricted stock units	$	1,316		$	166

Options

The Company used the Black-Scholes option-pricing model method of valuation for share-based awards under the provisions of SFAS No. 123 for grants awarded prior to January 1, 2006. It was not necessary for the Company to apply the option-pricing model method of valuation for share-based awards issued under the provisions of SFAS No. 123R as no options were granted since 2005.

The total intrinsic value of options exercised was $54 thousand and $30 thousand during the three months ended March 31, 2007 and 2006, respectively. Cash received from stock option exercises for the three months ended March 31, 2007 and 2006 was $439 thousand and $247 thousand, respectively. The income tax benefit from stock option exercises was $20 thousand and $11 thousand for the three months ended March 31, 2007 and 2006, respectively.

The following table presents the option activity for the three months ended March 31, 2007:

						Aggregate
					Weighted-	Intrinsic
			Weighted-		Average	Value
			Average		Remaining	As of
	Number of		Exercise		Contractual	March 31,
	Options		Price		Term	2007

Options outstanding as of December 31, 2006	1,955,463		$	32.48
Options granted	—		$	—
Options exercised	(17,001	)	$	24.66
Options forfeited	(8,000	)	$	31.65
Options expired	(30,625	)	$	33.93

Outstanding as of March 31, 2007	1,899,837		$	32.53	5.6	$	1,998,472

Options vested and expected to vest	1,896,269		$	32.53	5.6	$	1,998,472
Options vested and exercisable as of March 31, 2007	1,875,712		$	32.53	5.6	$	1,998,472
Weighted average remaining recognition period in years	1.4

As of March 31, 2007, $0.2 million of accumulated unrecognized compensation costs related to unvested stock options, net of estimated forfeitures, is expected to be recognized in future periods over a weighted average period of 1.4 years.

The following table presents the options outstanding as of March 31, 2007:

					Options Outstanding				Options Exercisable
					Number of	Weighted			Number of
					Options	Average	Weighted		Options	Weighted
					Outstanding	Remaining	Average		Exercisable	Average
					at March 31,	Contractual	Exercise		at March 31,	Exercise
Exercise Prices					2007	Life	Price		2007	Price
$		18.00	$	22.50	222,658	1.8	$	20.07	222,658	$	20.07
$	27.75		$	27.75	450,618	3.6	$	27.75	450,618	$	27.75
$	28.19		$	34.44	90,375	5.9	$	32.43	66,500	$	32.29
$	35.05		$	35.05	933,000	7.6	$	35.05	932,750	$	35.05
$	35.06		$	52.05	203,186	5.1	$	45.23	203,186	$	45.23

					1,899,837	5.6	$	32.53	1,875,712	$	32.52

3. INTANGIBLE ASSETS AND GOODWILL

(A) Indefinite-Lived Intangibles

Under the provisions of SFAS No. 142, “Goodwill and Other Intangible Assets,” goodwill and certain intangible assets are not amortized. Instead, these assets are reviewed at least annually for impairment and charged to results of operations only in the periods in which the recorded value of goodwill and certain intangibles is more than its fair value. The Company has determined that broadcasting licenses are deemed to have indefinite useful lives.

Other than goodwill, the Company uses a direct value method to determine the fair value of all intangible assets required to be: (i) recognized under SFAS No. 141; and (ii) tested for impairment under the provisions of SFAS No. 142.

Broadcasting Licenses

SFAS No. 142 requires the Company to test broadcasting licenses for impairment, at a minimum, on an annual basis. The Company performs its annual impairment test in the first quarter of each year by: (i) determining the reporting unit; and (ii) comparing the carrying amount of the broadcasting licenses reflected on the balance sheet in each reporting unit to the fair value of the reporting unit’s broadcasting licenses.

If actual market conditions are less favorable than those projected by the industry or the Company, or if events occur or circumstances change that would, more likely than not, reduce the fair value of the Company’s broadcasting licenses below the amount reflected in the balance sheet, the Company is required to retest and may be required to recognize impairment charges in future periods.

The amount of unamortized broadcasting licenses reflected in the balance sheet as of March 31, 2007 was $1.4 billion. The Company determines the fair value of the broadcasting licenses by relying primarily on a discounted cash flow approach assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. The fair value contains assumptions incorporating variables that are based on past experiences and judgments about future performance using industry normalized information for an average station within a market. These variables would include but not be limited to: (1) the forecast growth rate of each radio market, including population, household income, retail sales and other expenditures that would influence advertising expenditures; (2) market share and profit margin of an average station within a market; (3) estimated capital start-up costs and losses incurred during the early years; (4) risk-adjusted discount rate; (5) the likely media competition within the market area; and (6) terminal values.

During each of the first quarters of 2007 and 2006, the Company completed the non-amortizing intangible asset impairment test for broadcasting licenses and determined that: (1) the reporting unit was a radio market; and (2) the fair value of the broadcasting licenses was equal to or greater than the amount reflected in the balance sheet for each of the Company’s markets. Based upon the results of each of the asset impairment tests, no impairment charges were recorded.

Goodwill

SFAS No. 142 requires the Company to test goodwill for impairment, at a minimum, on an annual basis. The Company performs its annual impairment test during the second quarter of each year by: (1) determining the reporting unit; and (2) comparing the fair value for each reporting unit with the amount reflected on the balance sheet. If the fair value for any reporting unit is less than the amount reflected in the balance sheet, an indication exists that the amount of goodwill attributed to a reporting unit may be impaired, and the Company is required to perform a second step of the impairment test. In the second step, the Company compares the implied fair value of the reporting unit’s goodwill, determined by allocating the reporting unit’s fair value to all of its assets and liabilities in a manner similar to a purchase price allocation in accordance with SFAS No. 141, to the amount reflected in the balance sheet.

The amount of goodwill reflected in the balance sheet as of March 31, 2007 was $157.2 million. To determine the fair value, the Company uses an income or market approach for each reporting unit. The market approach compares recent sales and offering prices of similar properties. The income approach uses the subject property’s income generated over a specified time and capitalized at an appropriate market rate to arrive at an indication of the most probable selling price.

No event occurred or circumstances changed during the first quarter of 2007 or 2006 that would have, more likely than not, reduced the fair value of goodwill below the amount reflected in the balance sheet and, accordingly, no impairment charge was recorded for the three months ended March 31, 2007 and 2006.

There were no changes in the carrying amount of goodwill for the three months ended March 31, 2007.

(B) Definite-Lived Intangibles

The Company has definite-lived intangible assets that consist of advertiser lists and customer relationships, acquired advertising contracts and income leases that are amortized in accordance with SFAS No. 142. These assets are amortized over the period for which the assets are expected to contribute to the Company’s future cash flows and are reviewed for impairment in accordance with SFAS No. 144 whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The amount of the amortization expense for definite-lived intangible assets was $0.1 million for each of the three months ended March 31, 2007 and 2006. As of March 31, 2007, the Company reflected $0.3 million in unamortized definite-lived assets, which amount is included in deferred charges and other assets on the balance sheet.

The following is an estimate of the amortization expense for definite-lived assets, in thousands, for each of the succeeding years ending December 31:

	Definitive-
	Lived
	Assets
Years ending December 31,
2007 (excludes the three months ended March 31, 2007)	$	105
2008	86
2009	46
2010	15
2011	10
Thereafter	13
Total	$	275

4. ACQUISITIONS AND UNAUDITED PRO FORMA SUMMARY

Acquisitions For The Three Months Ended March 31, 2007 And 2006

There were no acquisitions or dispositions during the three months ended March 31, 2007 (see Note 8, Commitments and Contingencies, for a discussion of pending transactions) and the three months ended March 31, 2006.

Unaudited Pro Forma Summary Of Financial Information

The following unaudited pro forma summary of financial information presents the consolidated results of operations as if any acquisitions which occurred during the period of January 1, 2006 through March 31, 2007 had all occurred as of the beginning of the respective periods. The summary also includes certain adjustments, including depreciation and amortization of assets and interest expense on any debt incurred to fund acquisitions which would have been incurred had such acquisitions occurred as of the beginning of the respective periods. There were no acquisitions during the three months ended March 31, 2007; therefore, actual information appears in the tables below. These unaudited pro forma results, which do not reflect: (1) dispositions of radio stations; and (2) acquisitions and dispositions of certain contracts or joint sales agreements, have been prepared for comparative purposes only and do not purport to be indicative of what would have occurred had the acquisitions been made as of that date or of results which may occur in the future.

	Three Months Ended March 31,
	2007			2006
	(amounts in thousands, except per share data)
	Actual			Pro Forma

Net revenues	$	100,022		$	91,135
Net income (loss)	$	(564	)	$	7,496
Net income (loss) per common share - basic and diluted	$	(0.01	)	$	0.18

5. SENIOR DEBT

Bank Revolver

The Company’s Bank Revolver is a five-year senior secured revolving credit facility in the amount of $900.0 million that matures on August 11, 2009. The Company uses the Bank Revolver to: (i) provide for working capital; and (ii) provide for general corporate purposes, including capital expenditures and any or all of the following: repurchases of Class A common stock, acquisitions and dividends. The Bank Revolver is secured by a pledge of 100% of the capital stock and other equity interest in all of the Company’s wholly owned subsidiaries. The Bank Revolver requires the Company to comply with certain financial covenants and leverage ratios which are defined terms within the agreement, including: (1) Total Debt to Operating Cash Flow; (2) Operating Cash Flow to Interest Expense; and (3) Operating Cash Flow to Fixed Charges. Upon the occurrence of certain events, the interest rate under the Bank Revolver can increase to: (a) a maximum of the Eurodollar rate plus 1.50%; or, (b) the greater of prime rate plus 0.50% or the federal funds rate plus 1.0%. The Company also pays a commitment fee that varies, depending on certain financial covenants and the amount of the unused commitment, to a maximum of 0.375% per year, on the average unused balance of the Bank Revolver.

As of March 31, 2007, the Company had $545.0 million outstanding, as well as a $1.5 million letter of credit, under the Bank Revolver. Subject to covenant compliance at the time of each borrowing, the amount available under the Bank Revolver as of March 31, 2007 was $353.5 million. Management believes that, as of March 31, 2007, the Company was in compliance with all financial covenants and all other terms of the Bank Revolver. Any borrowings necessary to consummate closing on any of the pending transactions as described under Note 8, Commitments and Contingencies, is conditioned on compliance under the Bank Revolver at the time of closing.

Guarantor Financial Information

Entercom Radio, LLC (“Radio”), which is a wholly owned finance subsidiary of Entercom Communications Corp., holds the ownership interest in various subsidiary companies that own the operating assets, including broadcasting licenses, permits and authorizations. Radio is the borrower of: (1) the Company’s senior debt under the Bank Revolver described in Note 5; and (2) the Company’s 7.625% Senior Subordinated Notes, described in Note 6. Entercom Communications Corp. and each of its direct and indirect 100% owned subsidiaries (other than Radio) is a guarantor of such debt. Separate condensed consolidating financial information is not included as Entercom Communications Corp. does not have independent assets or operations, Radio is a 100% owned finance subsidiary of Entercom Communications Corp., and all guarantees by Entercom Communications Corp. and its subsidiaries are full and unconditional, and joint and several.

Under the Bank Revolver, Radio is permitted to make distributions to Entercom Communications Corp. in amounts, as defined, that are required to pay Entercom Communications Corp.’s reasonable overhead costs, including income taxes and other costs associated with conducting the operations of Radio’s subsidiaries. Under the Company’s 7.625% Senior Subordinated Notes, Radio is permitted to make distributions to Entercom Communications Corp. in amounts, as defined, that are required to pay Entercom Communications Corp.’s overhead costs and other costs associated with conducting the operations of Radio’s subsidiaries.

Interest Rate Transactions

The Company from time to time enters into interest rate transactions with different banks to diversify its risk associated with interest rate fluctuations against the variable rate debt under the Bank Revolver. Under these transactions, the Company agrees with other parties to exchange, at specified intervals, the difference between fixed rate and floating rate interest amounts calculated by reference to an agreed notional principal amount against the variable debt. See Note 7, Derivative and Hedging Activities, for further discussion.

6. SENIOR SUBORDINATED NOTES

On March 5, 2002, the Company issued $150.0 million of 7.625% Senior Subordinated Notes (the “Notes”) due March 1, 2014 and received net proceeds of $145.7 million. There were approximately $4.3 million in deferred offering costs recorded in connection with this issuance, which are amortized to interest expense over the life of the Notes using the effective interest rate method.

Interest on the Notes accrues at the rate of 7.625% per year and is payable semi-annually in arrears on March 1 and September 1. The Company could redeem the Notes on and after March 1, 2007 at an initial redemption price of approximately 103.8% of their principal amount plus accrued interest. The Notes are unsecured and rank junior to the Company’s senior indebtedness. In addition to the parent, Entercom Communications Corp., all of the Company’s subsidiaries (other than Entercom Radio, LLC, the issuer of the Notes) have fully and unconditionally guaranteed jointly and severally these Notes (the “Subsidiary Guarantors”). Under certain covenants, the Subsidiary Guarantors are restricted from paying dividends or distributions in excess of amounts defined under the Notes, and the Subsidiary Guarantors cannot incur additional indebtedness under certain restrictive covenants.

7. DERIVATIVE AND HEDGING ACTIVITIES

In accordance with the provisions of SFAS No. 133, as amended, “Accounting for Derivative and Hedging Activities,” the Company follows established accounting and reporting standards for: (1) derivative instruments, including certain derivative instruments embedded in other contracts, which are collectively referred to as derivatives; and (2) hedging activities. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation. All derivatives, whether designated in hedging relationships or not, are required to be recorded on the balance sheet at fair value. If the derivative is designated as a fair value hedge, the changes in the fair value of the derivative and the hedged item are recognized in the statement of operations. If the derivative is designated as a cash flow hedge, changes in the fair value of the derivative are recorded in other comprehensive income (loss) and are recognized in the statement of operations when the hedged item affects net income (loss). A derivative that does not qualify as a hedge is marked to fair value through the statement of operations. The Company formally documents all

relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking various hedging transactions. This process includes relating all derivatives that are designated as fair value or cash flow hedges to specific assets and liabilities on the balance sheet or to specific firm commitments or forecasted transactions. The Company also formally assesses, both at the inception of the hedge and on an ongoing basis, whether each derivative is highly effective in offsetting changes in fair values or cash flows of the hedged item. If it is determined that a derivative is not highly effective as a hedge or if a derivative ceases to be a highly effective hedge, the Company will discontinue hedge accounting prospectively (see Note 5, Senior Debt - Interest Rate Transactions).

As of March 31, 2007 and 2006, the Company had an interest rate transaction outstanding with a notional amount of $30.0 million and an initial term of 10 years, that expires in February 2008. This interest rate transaction effectively fixes the interest at a rate of 5.8% on borrowings equal to the total notional amount. This derivative does not qualify for hedge accounting treatment. For the three months ended March 31, 2007 and 2006, the Company recorded to the condensed consolidated statement of operations a net gain of under $0.1 million and $0.3 million, respectively, under net gain on derivative instruments.

8. COMMITMENTS AND CONTINGENCIES

Pending Transactions

The following transactions to acquire and divest radio stations are subject to FCC approval and are expected to close during the second quarter of 2007 (other than the divestiture of the Rochester stations for the reasons described below).

Pending Exchange: Cincinnati, Ohio; Seattle, Washington; and San Francisco, California

On January 17, 2007, the Company entered into an agreement with Bonneville International Corporation (“Bonneville”) to exchange certain radio stations in Cincinnati, Ohio, and Seattle, Washington, for certain radio stations in San Francisco, California, and $1.0 million in cash. Concurrently with entering into the asset exchange agreement, the Company also entered into two time brokerage agreements (“TBA”). Pursuant to these TBAs, on February 26, 2007 the Company commenced operations of the San Francisco stations and Bonneville commenced operations of the Cincinnati and Seattle stations. During the period of the TBA, the Company will: (i) include net revenues and station operating expenses associated with operating the San Francisco stations in the Company’s consolidated financial statements; and (ii) exclude net revenues and station operating expenses associated with operating the Cincinnati stations and three of the Seattle stations in the Company’s consolidated financial statements. The Company cannot complete the sale of the Cincinnati stations to Bonneville until the Company has completed the acquisition of stations from CBS Radio Stations Inc. (“CBS”) and completed the transaction to exchange with Cumulus Media Partners LLC (“Cumulus”) certain stations in Cincinnati (see table below for summary of transactions). The fair value of the assets acquired in exchange for the assets disposed cannot be determined at this time as it is dependent on the results of an appraisal for all assets included in this transaction. The Company does not anticipate that cash will be required to complete this transaction. Upon completion of the transactions described under Note 8, the Company will: (1) own three stations in San Francisco, a new market for the Company; (2) continue to own and operate four radio stations in the Seattle market; and (3) exit the Cincinnati market.

The following is a summary of those radio stations that are included in the exchange:

Markets	Radio Stations	Transactions
San Francisco, CA	KDFC-FM; KMAX-FM; and KOIT-FM	Company acquires from Bonneville
Seattle, WA	KBSG-FM; KIRO-AM; and KTTH-AM	Company disposes to Bonneville
Cincinnati, OH	WKRQ-FM; WUBE-FM; WYGY-FM; WGRR-FM	Company acquires from CBS
Cincinnati, OH	WGRR-FM	Company disposes to Cumulus
Cincinnati, OH	WSWD-FM	Company acquires from Cumulus
Cincinnati, OH	WKRQ-FM; WSWD-FM; WUBE-FM; WYGY-FM	Company disposes to Bonneville

Pending Exchange: Cincinnati, Ohio

On October 31, 2006, the Company entered into an agreement with Cumulus to exchange WGRR-FM, a radio station included in the CBS acquisition noted below and the Bonneville transaction noted above, for WSWD-FM and certain other intellectual property. WSWD-FM, with a frequency of 94.9 on the FM band, has had several recent call letter changes (in most recent order, formerly WYGY-FM and WPRV-FM). Each of the stations included in the exchange, WGRR-FM and WSWD-FM, serves the Cincinnati, Ohio, radio market. Concurrently with entering into the asset exchange agreement, the Company also entered into TBAs. Pursuant to these TBAs, on November 1, 2006 the Company

commenced operations of WSWD-FM and Cumulus commenced operations of WGRR-FM (the TBA income and TBA fees were equal in amount under the TBA agreements). The Company cannot complete the sale of WGRR-FM to Cumulus until the Company has completed the acquisition of WGRR-FM from CBS. The fair value of the assets acquired in exchange for the assets sold cannot be determined at this time as it is dependent on the results of an appraisal for WGRR-FM and WSWD-FM. The Company does not anticipate that cash will be required to complete this transaction. See Note 8 for a description of other transactions related to this exchange.

Pending Acquisition: Austin, Texas; Cincinnati, Ohio; and Memphis, Tennessee

On August 18, 2006, the Company entered into an asset purchase agreement with CBS to acquire the assets of eleven radio stations serving the Memphis, Austin and Cincinnati radio markets for $220.0 million in cash. Concurrently with entering into the asset purchase agreement, the Company also entered into a TBA under the provisions of which the Company commenced operations on November 1, 2006 (other than the radio station as described under Note 8 that Cumulus began operating on November 1, 2006 under a TBA with the Company). During the period of the TBA, the Company will include net revenues, station operating expenses and TBA fees associated with operating these stations in the Company’s consolidated financial statements. With the Austin and Cincinnati acquisitions, the Company entered into two new radio markets. In Memphis, the acquisition of three radio stations from CBS adds to the three radio stations that the Company currently owns and operates in this market. See Note 8 for a description of other related transactions.

Pending Acquisition: Rochester, New York

On August 18, 2006, the Company entered into an asset purchase agreement with CBS to acquire the assets of four radio stations serving the Rochester radio market for $42.0 million in cash. Under the Communications Act (“Act”), the FCC imposes specific limits on the number of commercial radio stations an entity can own in a single market. Due to these restrictions, the Company cannot own or operate more than five FM radio stations in this market. In addition, the Company is required to meet certain requirements under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. As a result, the Company agreed with the U.S. Department of Justice (“DOJ”) to divest three FM radio stations in this market. Such divestiture must be approved by the DOJ and the FCC. The Company has petitioned the FCC for a temporary waiver of its Ownership rules to allow it to acquire all of the CBS Rochester stations, subject to the requirement to divest three stations under the agreement with the DOJ. The Company expects to receive this waiver from the FCC and to close on the transaction in the second quarter of 2007. Upon the expected closing on the CBS transaction and the divestiture of three radio stations, the Company would own and operate five radio stations in the Rochester, New York, market.

Pending Acquisition: Springfield, Massachusetts

On February 10, 2006, the Company entered into an asset purchase agreement to acquire the radio station assets of WVEI-FM (formerly WBEC-FM), serving the Springfield, Massachusetts, radio market, for $5.8 million in cash, of which $0.3 million was paid as a deposit on February 10, 2006. On October 17, 2006, the Company entered into a TBA under which the Company paid a deposit of $1.5 million and commenced operations on October 26, 2006. The net revenues, station operating expenses and TBA fees associated with operating this station were included in the Company’s condensed consolidated financial statements for the year ended December 31, 2006. With the commencement of the TBA, the Company began simulcasting the format of WEEI-AM (a radio station owned and operated by the Company in the Boston, Massachusetts, market) on WVEI-FM, thereby extending the WEEI-AM brand into a new market. Under the asset purchase agreement and the TBA, the Company did not assume any advertising contracts nor hire any employees. The Company does not currently own or operate any other radio stations in this market.

Pending Disposition: Austin, Texas

On February 20, 2007, the Company entered into an agreement to sell KXBT-FM in Austin, Texas, for $20.0 million in cash, of which $1.0 million was paid as a deposit on February 20, 2007. The Company also entered into a TBA that commenced on February 26, 2007. The Company cannot complete the sale of KXBT-FM until the Company has completed the acquisition of this station from CBS (see Note 8). The Company believes that the divestiture of this station, will not alter the competitive position of the remaining three stations the Company currently operates in this market.

Pending Disposition: Portland, Oregon

On January 31, 2007, the Company entered into an agreement to sell KTRO-AM (formerly KKSN-AM) in Portland, Oregon, for an amount between $4.2 million and $4.5 million in cash, which amount depends on the Company’s compliance with certain conditions. Concurrently with entering into the agreement, the Company also entered into a TBA that was effective on February 1, 2007. The Company believes that the divestiture of this station, will not alter the competitive position of the remaining six stations the Company currently operates in this market.

Pending Disposition: Land In Sacramento, California

On April 7, 2004, the Company entered into an agreement to sell land at one of its Sacramento, California, transmitter sites for $10.5 million in cash, of which the buyer has paid $1.3 million to the Company as a deposit ($0.3 million of this amount was paid on April 13, 2007). Under certain circumstances, the deposit can be forfeited if the buyer defaults under the agreement. Closing on this transaction, which is not assured, is expected in late 2007.

Contingencies

On January 25, 2007, a wrongful death suit was filed against the Company relating to an on-air contest. The lawsuit seeks compensatory and unspecified punitive damages, which claims may not be fully covered by the Company’s insurance policy. The local county sheriff’s department, which had initiated an investigation, recently concluded that no criminal charges will be filed. The FCC has also initiated an investigation into this contest. The Company cannot comment at this time on the prospects for any outcome of these proceedings.

During 2006, the Company received several inquiries from the FCC that were related to the FCC’s increased enforcement activity in the area of sponsorship identification and payola, which is prohibited by the Communications Act. As a result of the FCC’s investigation, on April 13, 2007, the Company (along with several other media companies) entered into a settlement in the form of a Consent Decree with the FCC and agreed to implement certain enhancements to the Company’s business practices and appoint a Compliance Officer to implement and monitor these practices. As part of the Company’s settlement with the FCC, the Company did not admit any liability and agreed to pay $4.0 million to the U.S. Treasury. For the year ended December 31, 2006, the Company recorded $4.0 million in the Company’s consolidated statements of operations under corporate and general and administrative expenses.

The FCC has engaged in more vigorous enforcement, against the broadcasting industry as a whole, of FCC rules concerning the broadcast of obscene, indecent or profane material. A recent change in federal law has increased the FCC’s authority to impose a fine for the broadcast of such material to $325,000 for a single incident. As a consequence, the Company could face increased costs in the form of fines and a greater risk that the Company could lose any one or more of its broadcasting licenses if the FCC concludes that programming broadcast by a Company station was obscene, indecent or profane and such conduct warrants license revocation. In the past, the FCC has issued Notices of Apparent Liability and a Forfeiture Order with respect to several of the Company’s stations proposing fines for certain programming which the FCC deemed to have been “indecent.” These cases are the subject of pending administrative appeals. The FCC has also commenced several other investigations based on allegations received from the public that some of the Company’s stations broadcast indecent programming. The Company has cooperated in these investigations, which remain pending. The Company estimates that the imposition of the proposed fines would not materially impact the Company’s financial position, results of operations or cash flows.

The Company has filed, on a timely basis, renewal applications for those radio stations for which their radio broadcasting licenses are subject to renewal with the Federal Communications Commission. Certain licenses were not renewed prior to the renewal date, which is not unusual. The Company continues to operate these radio stations under their existing licenses until the licenses are renewed. The renewal may be delayed pending the resolution of open inquiries by the FCC. The stations are authorized, however, to continue operations until the renewal application is acted on by the FCC.

On May 19, 2003, the Company acquired the assets of radio station KWOD-FM, Sacramento, California, from Royce International Broadcasting Corporation (“Royce”) for a purchase price of $21.2 million in cash. This acquisition was accomplished following extensive litigation. Although the Company successfully secured the assets of KWOD-FM through court-ordered specific performance of the agreement, Royce has continued to appeal its case through the California judicial system. While the order granting specific performance and ordering the transfer of the station is final, the court’s determination that the Company was entitled to $3.8 million in damages as an offset against the original $25.0 million purchase price is subject to appeal. The Company cannot determine the amount of time required for the appeal process to be completed. The Company estimates that the impact of an unfavorable outcome will not materially impact the Company’s financial position, results of operations or cash flows.

The Company’s six radio stations located in New Orleans, Louisiana, were affected by Hurricane Katrina and the subsequent flooding. During the first half of 2007, the Company expects to complete the construction of new studio and office facilities and to strengthen certain of its transmitter facilities to better withstand a similar event of this nature. The cost of the construction is estimated to be between $4.0 million and $5.0 million. Under the Company’s insurance policies, the Company has recovered $0.8 million for expenses that were unrelated to the construction described above. The Company cannot, however, determine at this time if any additional amounts will be recoverable.

The Company uses a combination of insurance and self-insurance mechanisms to provide for the potential liabilities for workers’ compensation, general liability, property, directors and officers’ liability, vehicle liability and employee health care benefits. Liabilities associated with the risks that are retained by the Company are estimated, in part, by considering claims experience, demographic factors, severity factors, outside expertise and other actuarial assumptions.

The Company is subject to various outstanding claims which arise in the ordinary course of business and to other legal proceedings. In the opinion of management, any potential liability of the Company which may arise out of, or with respect to, these matters will not materially affect the Company’s financial position, results of operations or cash flows.

Guarantor Arrangements

Under the provisions of FIN 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, an Interpretation of FASB Statements No. 5, 57, and 107 and Rescission of FASB Interpretation No. 34,” a guarantor recognizes, at the inception of a guarantee, a liability for the fair value of the obligation undertaken by issuing the guarantee. The following is a summary of agreements that the Company has determined are within the scope of FIN 45.

Under the Company’s Bank Revolver, the Company is required to reimburse lenders for any increased costs that they may incur in the event of a change in law, rule or regulation resulting in their reduced returns from any change in capital requirements. The Company cannot estimate the potential amount of any future payment under this provision nor can the Company predict if such an event will occur.

The Company enters into indemnification agreements in the ordinary course of business and other agreements which include indemnification provisions. Under these agreements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements could be unlimited. The Company believes the estimated fair value of these agreements is minimal. Accordingly, the Company has not recorded liabilities for these agreements as of March 31, 2007.

9. SHAREHOLDERS’ EQUITY

Dividends

The following table presents a summary of the Company’s dividend activity during the three months ended March 31, 2007:

(amounts in millions, except per share data)
	Amount
	Per				Total
Declaration	Common		Record	Payment	Amount
Date	Share		Date	Date	Paid

February 20, 2007	$	0.38	March 14, 2007	March 28, 2007	$	14.9

Dividend Equivalents

Grants of restricted stock units made on and after April 6, 2006 included the right, upon vesting, to receive a dividend equivalent amount equal to the aggregate of all dividends which would have been paid on the restricted stock units. For the three months ended March 31, 2007, the Company paid $0.1 million to the holders of restricted stock units that vested during this period. The dividend equivalent amount, accrued and unpaid on unvested restricted stock units, was $1.4 million as of March 31, 2007.

Repurchases Of Vested Restricted Stock Units

Upon the vesting of restricted stock units, there is a taxable event to the employee that requires the withholding of taxes from the employee. Upon vesting, the employee can elect to have the Company withhold shares of stock in an amount sufficient to cover the employee’s tax withholding obligations. As a result of such elections by the employees during the three months ended March 31, 2007, the Company is deemed to have repurchased 42 thousand shares of stock.

Share Repurchase Programs

The Company’s Board of Directors has authorized in the past, and may authorize in the future, share repurchase programs over defined periods of time. Any repurchases under these programs may be made in the open market, through block trades or otherwise. Depending on market conditions and other factors, these repurchases may be commenced or suspended at the discretion of Company management at any time or from time to time without prior notice. All shares repurchased are immediately restored to authorized but unissued status.

During the three months ended March 31, 2007, the Company repurchased 0.4 million shares in the amount of $10.0 million at an average price of $28.30 per share. During the three months ended March 31, 2006, the Company repurchased 2.6 million shares in the amount of $77.2 million at an average price of $29.36 per share.

Under the May 8, 2006 share repurchase program, which on May 3, 2007 was extended by the Company’s Board of Directors for an additional term of one year to May 7, 2008, $85.2 million remained authorized as available for repurchase at March 31, 2007.

10. DEFERRED COMPENSATION PLANS

Under two separate deferred compensation plans, the Company provides a select group of the Company’s employees and the Board of Directors with an opportunity to defer a portion of their compensation on a tax-favored basis. The obligations by the Company to pay these benefits under these plans represent unsecured general obligations that rank equally with the Company’s other unsecured and unsubordinated indebtedness. As of March 31, 2007, $2.3 million was deferred under these plans and was included in other long-term liabilities in the consolidated balance sheet. The Company also recorded a deferred tax asset of $0.9 million in connection with this liability as the deferred tax asset is not realized for tax purposes until the liability is paid. For the three months ended March 31, 2007, the Company recorded a gain of less than $0.1 million to corporate general and administrative expense.

11. NET INCOME PER SHARE

The net income per share is calculated in accordance with SFAS No. 128, “Earnings Per Share,” which requires presentation of basic net income per share and diluted net income per share. Basic net income per share excludes dilution and is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted net income per share is computed in the same manner as basic net income after assuming issuance of common stock for all potentially dilutive equivalent shares, which includes the potential dilution that could occur: (1) if all of the Company’s outstanding stock options that are in-the-money were exercised (using the treasury stock method); (2) if the restricted stock units with service conditions were fully vested (using the treasury stock method); (3) if the restricted stock units with service and market conditions were considered contingently issuable; and (4) if the participation by employees in an Employee Stock Purchase Plan is considered as an option (using the treasury stock method). Anti-dilutive instruments are not considered in this calculation.

For the three months ended March 31, 2007, stock options and restricted stock units were not included in the calculation of net loss per share as they were anti-dilutive. For the three months ended March 31, 2006, stock options and restricted stock units were included in the calculation of net income per share as they were dilutive.

The following table sets forth the computations of basic and diluted EPS:

	Three Months Ended
	March 31, 2007							March 31, 2006
	(amounts in thousands, except share and per share data)
	Loss			Shares	EPS			Income		Shares	EPS
Basic net income (loss) per share:
Net income (loss)	$	(564	)	39,386,939	$	(0.01	)	$	7,755	41,343,973	$	0.19
Impact of options and restricted stock units				—						123,705
Diluted net income (loss) per share:
Net income (loss)	$	(564	)	39,386,939	$	(0.01	)	$	7,755	41,467,678	$	0.19

For the three months ended March 31, 2007, 0.4 million shares were not considered as convertible under the treasury stock method for outstanding options and restricted stock units with service conditions, as convertible shares are considered anti-dilutive when there is a net loss. In computing the 0.4 million convertible shares under the treasury stock method, 1.6 million shares were not included as they were anti-dilutive (including 0.3 million restricted stock units with market conditions as the market conditions were not satisfied as of March 31, 2007).

For the three months ended March 31, 2006, 0.1 million shares were considered as convertible under the treasury stock method for outstanding options and restricted stock units with service conditions. In computing the 0.1 million convertible shares under the treasury stock method, 5.7 million shares were not included as they were anti-dilutive.

The Company has reviewed the guidance in Emerging Issues Task Force Issue 03-06, “Clarification of Issue 2(a): Participating Securities and the Two-Class Method under FASB Statement No. 128, Earnings Per Share,” on the allocation of undistributed net income and determined that it was appropriate to allocate undistributed net income between Class A and Class B common stock on an equal basis. In making this distribution, the Company noted that the Company’s charter provides that the holders of Class A and Class B common stock have equal rights and privileges except with respect to voting on certain matters.

12. INCOME TAXES

Effective Tax Rates

The Company’s income tax expense for the three months ended March 31, 2007 was based on the estimated annual effective tax rate for 2007, which includes: (1) the effect of permanent differences between income subject to income tax for book and tax purposes; and (2) any discrete items of tax, such as (a) the effect of a $2.9 million adjustment to income tax expense as described in the paragraph below; and (b) the effect of changes in the Company’s FIN 48 liabilities since adoption on January 1, 2007. Any subsequent fluctuation in the estimated annual rate for 2007 could be due to: (1) changes in the level of income in any of the Company’s taxing jurisdictions; (2) changes in the statutes and rules applicable to taxable income in the jurisdictions in which the Company operates; (3) changes in the expected outcome of tax audits; (4) changes in the estimate of expenses that are not deductible for tax purposes; (5) additional states in which the Company conducts business as a result of pending acquisitions; and (6) changes in the deferred tax valuation allowance. The Company’s effective tax rate is higher than the federal statutory rate of 35% primarily as a result of the provision for state taxes (net of a federal tax deduction) in the tax rate.

The effective tax rate for the three months ended March 31, 2007 was 114.3%, which includes the impact of discrete items, such as the adjustment for $2.9 million as described below. For the three months ended March 31, 2006, the effective tax rate was 38.4%. The effective tax rate increased primarily due to: (1) commencing operations in 2007 in states which on average have higher income tax rates than in states in which the Company previously operated and its effect in the amount of $2.9 million for the three months ended March 31, 2007 on previously reported temporary differences between the tax and financial reporting bases of the Company’s assets and liabilities; (2) income taxes in certain states where the states’ current taxable income is dependent on factors other than the Company’s consolidated net income (loss); (3) limits on the deduction of certain non-cash compensation expense for certain key employees; and (4) the effect of recording changes in the Company’s FIN 48 liabilities subsequent to adoption of FIN 48 on January 1, 2007.

The Company made income tax payments of $0.2 million and $0.1 million for the three months ended March 31, 2007 and 2006, respectively.

Deferred Tax Liabilities

As of March 31, 2007 and December 31, 2006, the Company had net non-current deferred tax liabilities of $238.6 million and $229.2 million, respectively. The income tax accounting process to determine the deferred tax liabilities involves estimating all temporary differences between the tax and financial reporting bases of the Company’s assets and liabilities, based on enacted tax laws and statutory tax rates applicable to the period in which the differences are expected to affect taxable income. The Company estimated the current exposure by assessing the temporary differences and computing the provision for income taxes by applying the estimated effective tax rate to income.

Deferred Tax Assets

The Company’s net current deferred tax assets as of March 31, 2007 and December 31, 2006 were $2.8 million and $3.4 million, respectively. As required under the provisions of SFAS No. 109, the Company establishes a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. In assessing a valuation allowance for deferred tax assets, the Company estimates future taxable income and provides a valuation allowance when it is less likely to be recovered. Future taxable income could be materially different than amounts estimated, in which case the valuation allowance would be adjusted. The Company recorded a partial valuation allowance of $0.9 million primarily due to the five-year limitation for tax purposes of recognizing a loss on investments for federal and state income taxes as only investment gains can be used to offset these losses. Based upon the years in which taxable temporary differences are anticipated to reverse, as of March 31, 2007, management believes it is more likely than not that

the Company will realize the benefits of the deferred tax asset balance (net of recorded allowances). On a quarterly basis, management assesses whether it remains more likely than not that the deferred tax assets will be realized.

FIN 48, Uncertain Tax Positions

On July 13, 2006, the FASB issued FIN 48, “Accounting for Uncertainty in Income Taxes, and Related Implementation Issues,” which provides guidance on the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions that a company has taken or expects to take on a tax return. Under FIN 48, financial statements should reflect expected future tax consequences of such positions presuming the taxing authorities have full knowledge of the position and all relevant facts. This interpretation also revises the disclosure requirements and was effective for the Company as of January 1, 2007.

As a result of the Company’s evaluation of FIN 48 and its effect on the Company’s financial position, results of operations and cash flows, on January 1, 2007, the Company recorded $1.8 million in expense (net of taxes) as a cumulative effect of an accounting change to the Company’s retained earnings. Of this amount, $1.1 million (net of taxes) represented interest and penalties. Subsequent to January 1, 2007, any change in interest and penalty liabilities will be reflected in the consolidated statement of operations as an adjustment to income tax expense rather than as an expense that would precede income before income taxes. Together with the previously recorded tax contingencies of $2.2 million as of December 31, 2006, the Company’s FIN 48 liabilities were $4.0 million and $4.1 million as of January 1, 2007 and March 31, 2007, respectively, which amounts were recorded in the consolidated balance sheets as long-term tax liabilities. In addition, due to the increase in the FIN 48 liabilities since adoption on January 1, 2007, $0.1 million in income tax expense (net of taxes) was included in the Company’s condensed consolidated statements of operations and condensed consolidated statements of cash flows for the quarter ended March 31, 2007. The Company reviews its estimates on a quarterly basis and any change in its FIN 48 liabilities will result as an adjustment to its income tax expense in the consolidated statement of operations in each period measured. The Company anticipates that there will be no immediate impact on the Company’s cash flows.

The Company is subject to federal and state income tax audits from time to time that could result in proposed assessments. The Company cannot predict with certainty how these audits will be resolved and whether the Company will be required to make additional tax payments, which may or may not include penalties and interest. As of March 31, 2007, the Company is subject to audit by the Internal Revenue Service for the tax years of 2004 through 2006. For most states where the Company conducts business, the Company is subject to examination for the preceding three to six years. In certain states, the period could be longer.

13. TRADE RECEIVABLES AND RELATED ALLOWANCE FOR DOUBTFUL ACCOUNTS

Trade receivables are primarily comprised of unpaid advertising by advertisers on the Company’s radio stations, net of agency commissions, and an estimated provision for doubtful accounts. Estimates of the allowance for doubtful accounts are recorded based on management’s judgment of the collectibility of the accounts receivable based on historical information, relative improvements or deteriorations in the age of the accounts receivable and changes in current economic conditions.

The trade receivable balances and reserve for doubtful accounts as of March 31, 2007 and December 31, 2006 are presented in the following table:

	March 31,			December 31,
	2007			2006
	(amounts in thousands)

Accounts receivable	$	81,531		$	93,272

Allowance for doubtful accounts	(2,913		)	(3,009		)

Accounts receivable, net of allowance for doubtful accounts	$	78,618		$	90,263

As of March 31, 2007 and December 31, 2006, the Company has recorded trade receivable credits in the amounts of $3.0 million and $2.3 million, respectively, which amounts as of March 31, 2007 and December 31, 2006 are included in the balance sheets under current liabilities of $3.5 million and $3.9 million, respectively.

As of March 31, 2007 and December 31, 2006, the Company has recorded unearned revenues in the amounts of $1.3 million and $1.2 million, respectively, which amounts are included in the balance sheets as of March 31, 2007 and December 31, 2006 under other current liabilities of $3.5 million and $3.9 million, respectively.

ITEM 2. Management’s Discussion And Analysis Of Financial Condition And Results Of Operations

General

We are one of the largest radio broadcasting companies in the United States based on net revenues. We were organized in 1968 as a Pennsylvania corporation. We operate in excess of 100 radio stations in 23 markets, including San Francisco, Boston, Seattle, Denver, Sacramento, Portland, Kansas City, Indianapolis, Milwaukee, Austin, Norfolk, Buffalo, New Orleans, Providence, Memphis, Greensboro, Rochester, Greenville/Spartanburg, Madison, Wichita, Wilkes-Barre/Scranton, Springfield and Gainesville/Ocala.

A radio broadcasting company derives its revenues primarily from the sale of broadcasting time to local and national advertisers. The advertising rates that a radio station is able to charge and the number of advertisements that can be broadcast without jeopardizing listener levels largely determine those revenues. Advertising rates are primarily based on four factors:

— a station’s audience share in the demographic groups targeted by advertisers, as measured principally by quarterly reports issued by The Arbitron Ratings Company;

— the number of radio stations in the market competing for the same demographic groups;

— the supply of and demand for radio advertising time, both nationally and in the regions in which the station operates; and

— the market’s size based upon available radio advertising revenue.

A growing source of revenues is from the station websites and streaming audio. This emerging category represents an opportunity for enhanced audience interaction and participation as well as integrated advertising.

Several factors may adversely affect a radio broadcasting company’s performance in any given period. In the radio broadcasting industry, seasonal revenue fluctuations are common and are due primarily to variations in advertising expenditures by local and national advertisers. Typically, revenues are lowest in the first calendar quarter of the year.

As opportunities arise, we may, on a selective basis, change or modify a station’s format due to changes in listeners’ tastes or changes in a competitor’s format. A format change or modification could have an immediate negative impact on a station’s ratings and/or revenues, and there are no guarantees that the modification or change will be beneficial at some future time. Our management is continually focused on these opportunities as well as the risks and associated uncertainties. We believe that the diversification of formats on our stations helps to insulate us from the effects of changes in the musical tastes of the public. We strive to develop compelling content and strong brand images to maximize audience ratings that are crucial to our stations’ financial success.

Our results of operations include net revenues and station operating expenses from stations we own and those net revenues and station operating expenses recognized under a time brokerage agreement (“TBA”) or similar sales agreement for stations operated by us prior to acquiring the stations. Depending on the facts and circumstances relating to each pending asset purchase agreement (e.g., whether or not there is an associated TBA or similar agreement) and the provisions of Financial Interpretation No. (“FIN”) 46R (as revised), “Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51,” which would include any variable interest entities that are required to be consolidated by the primary beneficiary, we may include: (1) the assets and liabilities of the entity holding the assets to be acquired, in our consolidated balance sheet; and (2) the net revenues and station operating expenses of the entity holding the assets to be acquired, in our consolidated statement of operations.

You should read the following discussion and analysis of our financial condition and results in conjunction with our consolidated financial statements and related notes included elsewhere in this report. The following results of operations include a discussion of the three months ended March 31, 2007 as compared to the three months ended March 31, 2006. Our results of operations represent the operations of the radio stations owned or operated pursuant to TBAs or joint sales agreements during the relevant periods.

We discuss net revenues, station operating expenses and operating income by comparing the performance of stations owned or operated by us throughout a relevant period to the performance of those same stations in the prior period whether or not owned or operated by us. We use these comparisons to assess the performance of our operations by analyzing the effect of acquisitions and dispositions of stations on net revenues and station operating expenses throughout the periods measured.

Results of Operations

The following significant factors affected our results of operations for the three months ended March 31, 2007 as compared to the three months ended March 31, 2006:

Acquisitions

· on February 26, 2007, we began operating three radio stations in San Francisco, California under a TBA agreement with Bonneville International Corporation (“Bonneville”), that in 2007 increased net revenues and station operating expenses and increased our income tax expense;

· on February 26, 2007, Bonneville began operating radio stations under a TBA in Cincinnati, Ohio (such stations were operated by us under TBAs with Cumulus Media Partners, LLC (“Cumulus”) and CBS Radio Stations Inc. (“CBS”) since November 1, 2006), and certain of our radio stations in Seattle, Washington, that in 2007, decreased net revenues and station operating expenses;

· on November 1, 2006, we began operating radio stations in Cincinnati, Ohio (other than the radio station as described below that Cumulus began operating on November 1, 2006 under a TBA), under a TBA with CBS, that for the period from January 1, 2007 through February 25, 2007 (Bonneville commenced operating these stations on February 26, 2007), increased net revenues and station operating expenses and for 2007 increased TBA expense;

· on November 1, 2006, we began operating radio stations in Austin, Texas, and Memphis, Tennessee, under a TBA with CBS, that in 2007 increased net revenues, station operating expenses and TBA expense;

· on November 1, 2006, we began operating a radio station in Cincinnati, Ohio, under a TBA with Cumulus, and on the same date, Cumulus began operating one of the radio stations in Cincinnati, Ohio, that was included in the CBS TBA described above, that for the period from January 1, 2007 through February 25, 2007 increased net revenues and station operating expenses (Bonneville commenced operating this station on February 26, 2007); and

· on August 21, 2006, we began operating WKAF-FM (formerly WILD-FM) in Boston, Massachusetts under a TBA by simulcasting the format of WAAF-FM (another radio station owned and operated by us in this market), that in 2007 contributed to the WAAF-FM brand net revenues and increased station operating expenses, and depreciation and amortization, and interest expense (the station was acquired by us on December 29, 2006).

Dispositions

· on February 26, 2007, a buyer began operating KXBT-FM, Austin, Texas under a TBA (a station we began operating on November 1, 2006 under a TBA agreement with CBS), that: (i) for the period from January 1, 2007 through February 25, 2007, increased net revenues and station operating expenses; and (ii) since February 26, 2007, increased TBA income; and

· on February 1, 2007, a buyer began operating KTRO-AM (formerly KKSN-AM), Portland, Oregon under a TBA, that in 2007, decreased net revenues and station operating expenses and increased TBA income.

Financing

· in 2007, our interest expense increased due to increased borrowings and increased borrowing costs under our senior credit facility to finance: (i) the payment of quarterly cash dividends to our shareholders that commenced during the first quarter of 2006; (ii) the repurchase of our stock; and (iii) an acquisition during the fourth quarter of 2004.

Three Months Ended March 31, 2007 As Compared To The Three Months Ended March 31, 2006

Net Revenues:

		Three Months Ended
		March 31, 2007			March 31, 2006
		(dollars in millions)
Net Revenues		$	100.0		$	91.1
Amount of Change	+	$	8.9
Percentage Change		+ 9.8		%

Contributing to our overall increase in net revenues was the commencement of operations under TBAs on: (1) November 1, 2006 in the Austin, Cincinnati and Memphis markets; and (2) February 26, 2007, in the San Francisco market. Austin, Cincinnati and San Francisco were new markets for our operations. This increase was offset by the

decrease in net revenues for the commencement of operations by other parties under TBAs on: (i) February 26, 2007 for four stations in the Cincinnati market; (ii) February 26, 2007 for three of our seven Seattle stations; (iii) February 26, 2007 for a station in the Austin market; and (iv) February 1, 2007 for one of our seven Portland stations.

Same Station Considerations:

· Net revenues in 2007 would have been lower by $9.3 million if we had adjusted net revenues to give effect to acquisitions and dispositions of radio stations as of January 1, 2007.

· Net revenues in 2006 would have been lower by $0.9 million if we had adjusted net revenues to give effect to acquisitions and dispositions of radio stations as of January 1, 2006.

Station Operating Expenses:

		Three Months Ended
		March 31, 2007			March 31, 2006
		(dollars in millions)
Station Operating Expenses		$	68.4		$	59.6
Amount of Change	+	$	8.8
Percentage Change		+ 14.8		%

The increase of $8.8 million in station operating expenses was primarily due to: (1) the commencement of certain radio station operations in the Austin, Memphis and Cincinnati markets on November 1, 2006 under TBAs; (2) a correlating increase in station operating expenses associated with the net increase in net revenues as described under Net Revenues; (3) the increase in non-cash compensation expense of $0.4 million; and (4) the effects of inflation. This increase was offset by the decrease in station operating expenses for the commencement of operations by other parties under TBAs on: (i) February 26, 2007 for four stations in the Cincinnati market; (ii) February 26, 2007 for three of our seven stations in the Seattle market; (iii) February 26, 2007 for one of our four stations in the Austin market; and (iv) February 1, 2007 for one of our seven stations in the Portland market.

Same Station Considerations:

· Station operating expenses for 2007 would have been lower by $7.2 million if we had adjusted station operating expenses to give effect to acquisitions and dispositions of radio stations as of January 1, 2007.

· Station operating expenses for 2006 would have been higher by $0.1 million if we had adjusted station operating expenses to give effect to acquisitions and dispositions of radio stations as of January 1, 2006.

Depreciation And Amortization Expenses:

		Three Months Ended
		March 31, 2007			March 31, 2006
		(dollars in millions)
Depreciation and Amortization Expenses		$	4.1		$	3.9
Amount of Change	+	$	0.2
Percentage Change		+ 5.1		%

Depreciation and amortization expenses were higher primarily due to the increase in capital expenditures in 2006 as compared to prior years, coupled with the mix of assets with shorter amortization periods.

Corporate General And Administrative Expenses:

		Three Months Ended
		March 31, 2007			March 31, 2006
		(dollars in millions)
Corporate General and Administrative Expenses		$	7.7		$	6.0
Amount of Change	+	$	1.7
Percentage Change		+ 28.3		%

The increase in corporate general and administrative expenses of $1.7 million was primarily due to: (1) an increase in non-cash compensation expense of $1.1; (2) legal costs of $1.0 million associated with certain legal proceedings (see Part II, Item 1, “Legal Proceedings”); and (3) the effects of inflation. For the three months ended March 31, 2006, corporate general and administrative expenses were negatively impacted by $1.2 million for transaction costs associated with an acquisition that did not materialize.

The non-cash compensation expense increase of $1.1 million was due primarily to the grant of equity awards issued during the first quarter of 2007 and during the second quarter of 2006 to our key employees.

Operating Income:

	Three Months Ended
	March 31, 2007			March 31, 2006
	(dollars in millions)
Operating Income	$	15.7		$	21.8
Amount of Change	$	(6.1	)
Percentage Change	(28.0		)%

The decrease in operating income of $6.1 million was primarily due to an increase in net revenues for the reasons described above under Net Revenues, offset by: (1) an increase in station operating expenses for the reasons described above under Station Operating Expenses; (2) an increase in TBA fees primarily associated with the CBS transaction; and (3) an increase in corporate general and administrative expenses due to the reasons described above under Corporate General And Administrative Expenses.

Same Station Considerations:

· Operating income for 2007 would have been lower by $2.1 million if we had adjusted operating income to give effect to acquisitions and dispositions of radio stations as of January 1, 2007.

· Operating income for 2006 would have been lower by $1.0 million if we had adjusted operating income to give effect to acquisitions and dispositions of radio stations as of January 1, 2006.

Interest Expense:

		Three Months Ended
		March 31, 2007			March 31, 2006
		(dollars in millions)
Interest Expense		$	12.0		$	9.7
Amount of Change	+	$	2.3
Percentage Change		+ 23.7		%

The increase in interest expense of $2.3 million was primarily attributable to: (1) higher average outstanding debt under our senior credit agreement used to finance: (a) the acquisitions of radio station assets in Boston in the fourth quarter 2006 in the amount of $30.0 million; (b) the repurchase of our common stock in the amount of $10.0 million during the first quarter of 2007 and $100.5 million for the year ended December 31, 2006; (c) quarterly dividend payments that commenced during the first quarter of 2006; and (2) higher interest rates and higher borrowing costs on outstanding debt during the three months ended March 31, 2007 as compared to the three months ended March 31, 2006.

Income Before Income Taxes:

	Three Months Ended
	March 31, 2007			March 31, 2006
	(dollars in millions)
Income Before Income Taxes	$	3.9		$	12.6
Amount of Change	$	(8.7	)
Percentage Change	(69.0		)%

The decrease in income before income taxes of $8.7 million was mainly attributable to: (1) a decrease in operating income for the reasons described above under Operating Income; and (2) an increase in interest expense of $2.3 for the reasons described above under Interest Expense.

Income Taxes:

	Three Months Ended
	March 31, 2007			March 31, 2006
	(dollars in millions)
Income Tax	$	4.5		$	4.8
Amount of Change	$	(0.3	)
Percentage Change	(6.3		)%

The decrease in income taxes of $0.3 million is primarily the result of a decrease in income before income taxes for the reasons described above, offset by an increase in income taxes due to: (1) commencing operations in 2007 in states which on average have higher income tax rates than in states in which we previously operated and its effect in the amount of $2.9 million on previously reported temporary differences as of December 31, 2006 between the tax and financial reporting bases of our assets and liabilities; (2) income taxes in certain states where the states’ current taxable income is dependent on factors other than our consolidated net income (loss); (3) the impact of limitations on deductibility for tax purposes of share-based compensation for certain key employees; and (4) $0.1 million for the recognition of interest and penalties subsequent to the adoption of FIN 48.

Our effective income tax rate of 41.7% for the three months ended March 31, 2007 is based upon our estimated annual rate of 41.7% (exclusive of the impact to the rates in either period for discrete items, including the $2.9 million increase to income tax expense for the reason described above under Income Taxes). For the three months ended March 31, 2006, the effective income tax rate was 38.4%. Our estimated annual effective tax rate for 2007 may fluctuate from quarter to quarter. Our effective tax rate may also be materially impacted by: (1) changes in the level of income in any of our taxing jurisdictions; (2) changes in our estimate of uncertain tax positions in accordance with our adoption on January 1, 2007 of FIN 48; (3) regulatory changes in certain states in which we operate; (4) changes in the expected outcome of tax audits; (5) changes in the estimate of expenses that are not deductible for tax purposes; and (6) changes in the deferred tax valuation allowance.

For the three months ended March 31, 2007, the current and deferred portions of our income tax expense were a current tax credit of $6.7 million and a deferred tax expense of $11.2 million, respectively. For the three months ended March 31, 2006, the current and deferred portions of our income tax expense were a current tax credit of $4.5 million and a deferred tax expense of $9.3 million, respectively.

Our net non-current deferred tax liabilities were $238.6 and $229.2 million as of March 31, 2007 and December 31, 2006, respectively. The deferred tax liability primarily relates to differences between book and tax bases of our FCC licenses. Under the provisions of Statement of Financial Accounting Standard (“SFAS”) No. 142, we do not amortize our FCC licenses for financial statement purposes, but instead test them annually for impairment. As our FCC licenses continue to amortize for tax purposes, our deferred tax liability will increase over time. We do not expect the significant portion of our deferred tax liability to reverse over time unless: (1) our FCC licenses become impaired; or (2) our FCC licenses are sold for cash, which would typically only occur in connection with the sale of the assets of a station or groups of stations or the entire Company in a taxable transaction.

Net Income (Loss):

	Three Months Ended
	March 31, 2007			March 31, 2006
	(dollars in millions)
Net Income (Loss)	$	(0.6	)	$	7.8
Amount of Change	$	(8.4	)
Percentage Change	(107.7		)%

The decrease in net income to a net loss of $0.6 million was primarily attributable to the reasons described above under Income Before Income Taxes, net of income tax expense.

Liquidity And Capital Resources

Generally, our acquisitions, share repurchases, reductions of our outstanding debt, dividends and other capital requirements are funded from one or a combination of the following sources: (1) our credit agreement; (2) the issuance and sale of securities; (3) internally generated cash flow; and (4) the swapping of our radio stations in transactions which qualify as “like-kind” exchanges under Section 1031 of the Internal Revenue Code. Since we began our share repurchase initiative in May 2004, we have used a significant portion of our capital resources to repurchase shares of our common stock (see Liquidity and Capital Resources - Share Repurchase Programs below).

We have also used a portion of our capital resources to pay dividends in the aggregate amount of $14.9 million and $60.4 million during the three months ended March 31, 2007 and the year ended December 31, 2006, respectively. Prior to the payment of our first quarterly dividend in March 2006 and since becoming a public company in January 1999, we had not declared any dividends on any class of our common stock. We expect to continue to declare and pay quarterly cash dividends. In the future, any payment of dividends will be at the discretion of the Board of Directors and will depend upon, among other factors, our earnings, financial condition, capital requirements, level of indebtedness, contractual restrictions, including the provisions of our senior and subordinated debt, and other considerations that the Board of Directors deems relevant.

Our Bank Revolver

Our Bank Revolver with a syndicate of banks, is a five-year senior secured revolving credit facility of $900.0 million that expires on August 11, 2009. We use the Bank Revolver to: (1) provide for working capital; and (2) provide for general corporate purposes, including capital expenditures and any or all of the following: repurchases of common stock, acquisitions and dividends. The Bank Revolver is secured by a pledge of 100% of the capital stock and other equity interest in all of the Company’s wholly owned subsidiaries. The Bank Revolver requires the Company to comply with certain financial covenants and leverage ratios which are defined terms within the agreement, including: (1) Total Debt to Operating Cash Flow; (2) Operating Cash Flow to Interest Expense; and (3) Operating Cash Flow to Fixed Charges. Upon the occurrence of certain events, our interest rate can increase to: (a) a maximum of the Eurodollar rate plus 1.50%, or (b) the greater of prime rate plus 0.50% or the federal funds rate plus 1.0%. The Company also pays a commitment fee that varies, depending on certain financial covenants and the amount of the unused commitment, to a maximum of 0.375% per annum, on the average unused balance of the Bank Revolver. Management believes we are in compliance with all financial covenants and leverage ratios and all other terms of the Bank Revolver.

Liquidity

Our liquidity requirements are for working capital and general corporate purposes, including capital expenditures, and any one or more of the following: acquisitions, repurchases of stock and dividends. During the three months ended March 31, 2007, we paid $0.2 million in income taxes that included certain state taxes for 2006 and certain estimated state taxes for 2007. We anticipate that it will not be necessary to make any additional quarterly estimated federal and certain state income tax payments for the remainder of 2007 based upon existing prepayments and expected quarterly taxable income for the remaining quarters of 2007. In addition, we have certain federal and state tax net operating losses that may be recovered from prior years’ tax obligations. Capital expenditures for the three months ended March 31, 2007 were $3.3 million. We anticipate that capital expenditures in 2007 will consist of: (1) an amount between $6.0 million and $7.0 million for capital expenditures incurred in the ordinary course of business and for the conversion of our remaining FM stations to digital radio; and (2) between $7.0 million and $8.0 million primarily for: (a) the consolidation and the relocation of our studio and office facilities in common with the stations to be acquired under our pending transactions; and (b) the construction of new studio and office facilities in New Orleans as a result of the forced relocation from the effects of Hurricane Katrina. Exclusive of the impact of our pending acquisitions on our capital expenditure needs in 2007, we anticipate that our capital expenditures will be less in future years.

As of March 31, 2007, we had credit available of $353.5 million under the Bank Revolver, subject to compliance with the covenants under the Bank Revolver at the time of borrowing. As of March 31, 2007, we had $10.8 million in cash and cash equivalents. During the three months ended March 31, 2007, we increased our net outstanding debt by $19.0 million, primarily to help fund our repurchase of shares in the amount of $10.0 million and to pay dividends of $14.9 million to shareholders. As of March 31, 2007, we had outstanding $696.7 million in senior debt, including: (1) $545.0 million under our Bank Revolver; (2) $1.5 million in a letter of credit; and (3) $150.0 million in Senior Subordinated Notes. Due to the cash required for the closing on our pending transactions, we expect that in 2007, our outstanding debt will increase and our available credit under our Bank Revolver will decrease.

We may seek to obtain other funding or additional financing from time to time. We believe that cash on hand and cash from operating activities, together with available borrowings under the Bank Revolver, will be sufficient to permit us to meet our liquidity requirements for the foreseeable future, including cash to fund our operations and any pending acquisitions, repurchases of our stock and any declared dividends. We intend to finance the pending acquisitions (as described in the accompanying notes to the condensed consolidated financial statements), primarily from available borrowings under the Bank Revolver. Our Bank Revolver requires that, at the time of closing on acquisitions, we must be in compliance with the terms of the Bank Revolver. We believe that we will maintain compliance with the terms of our Bank Revolver. If we are not in compliance, there can be no assurance that we will be successful in amending the Bank Revolver, in entering into a new credit agreement or in obtaining additional financing or that we will be able to obtain such financing on terms acceptable to us, which could delay or impair our efforts to consummate future acquisitions. Failure to comply with our financial covenants or other terms of the Bank Revolver could result in the acceleration of the maturity of our outstanding debt.

Operating Activities

Net cash flows provided by operating activities were $8.6 million and $13.8 million for the three months ended March 31, 2007 and 2006, respectively. The decrease in 2007 was mainly attributable to a decrease in net income (loss) to a net loss of $0.6 million for the three months ended March 31, 2007 from net income of $7.8 million for the three months ended March 31, 2006. The decrease in cash flows provided by operating activities was offset by an increase in deferred taxes of $1.9 million for the reasons described above under income taxes and an increase in non-cash stock-based compensation expense of $1.6 million.

Investing Activities

Net cash flows used in investing activities were $3.0 million for each of the three months ended March 31, 2007 and 2006.

The cash used in investing activities reflects $3.3 million in additions to property and equipment for the three months ended March 31, 2007 as compared to $3.7 million for the three months ended March 31, 2006.

Financing Activities

Net cash flows used in financing activities were $5.7 million and $14.2 million for the three months ended March 31, 2007 and 2006, respectively.

The cash flows used in financing activities reflect the repurchase of common stock of $10.0 million and $77.2 million for the three months ended March 31, 2007 and 2006, respectively, offset by net borrowings of long-term debt of $19.0 million and $78.0 million for the three months ended March 31, 2007 and 2006, respectively. The payments of dividends for the three months ended March 31, 2007 and 2006 were $14.9 million and $15.4 million, respectively.

Credit Rating Agencies

On a continuing basis, credit rating agencies such as Moody’s Investor Services and Standard and Poor’s evaluate our debt in order to assign a credit rating. As a result of their reviews, our credit rating could change. Any significant downgrade in our credit rating could adversely impact our future liquidity. The effect of a change in our credit rating may limit or eliminate our ability to obtain debt financing, or include, among other things, interest rate changes under any future bank facilities, debentures, notes or other types of debt.

Share Repurchase Programs

Over the past several years, our Board of Directors has authorized one-year share repurchase programs of up to $100.0 million for each program. Under the May 8, 2006 share repurchase program, which on May 3, 2007 was extended

by the Board of Directors for an additional term of one year to May 7, 2008, $85.2 million remained authorized as available for repurchase at March 31, 2007. During the three months ended March 31, 2007, we have repurchased an aggregate of 0.4 million shares in the amount of $10.0 million at an average price of $28.30 per share.

Contractual Obligations

The following table reflects a summary as of March 31, 2007 of our contractual obligations for the remainder of the year 2007 and thereafter:

	Payments due by period
			Less than		1 to 3		3 to 5		More Than 5
Contractual Obligations:	Total		1 year		years		years		years
	(amounts in thousands)

Long-term debt obligations (1)	$	855,578	$	34,510	$	623,347	$	22,871	$	174,850
Operating lease obligations	68,410		8,003		21,161		15,245		24,001
Purchase obligations (2)	795,181		575,069		92,991		39,033		88,088
Other long-term liabilities (3)	249,290		88		867		1,061		247,274
Total	$	1,968,459	$	617,670	$	738,366	$	78,210	$	534,213

(1) (a) Our Bank Revolver had outstanding debt in the amount of $545.0 million as of March 31, 2007. The maturity under our Bank Revolver could be accelerated if we do not maintain certain covenants. The above table includes projected interest expense under the remaining term of the agreement.

(b) Under our $150.0 million 7.625% senior subordinated notes, the maturity could be accelerated if we do not maintain certain covenants or could be repaid in cash by us at our option prior to the due date of the notes. The above table includes projected interest expense under the remaining term of the agreement.

(2) (a) After extensive litigation, on May 19, 2003, we acquired a radio station for a purchase price of $21.2 million, which included an award by the court of $3.8 million in damages as an offset against the original $25.0 million purchase price. A successful appeal by the seller could reverse the $3.8 million in damages awarded by the court.

(b) We have obligations of $267.8 million to acquire the assets of 16 radio stations under several pending asset purchase agreements in the following markets: Cincinnati, Ohio; Austin, Texas; Memphis, Tennessee; Rochester, New York; and Springfield, Massachusetts.

(c) We have obligations of approximately $250.0 million to acquire the assets of 4 radio stations under several pending asset exchange agreements in the Cincinnati and San Francisco markets. The obligations under these asset exchange agreements are estimates at this time and are subject to change as the fair value will be determined under the provisions of SFAS No. 153, “Exchanges of Nonmonetary Assets, an Amendment of APB Opinion No. 29.”

(d) We have $3.4 million in liabilities related to: (i) construction obligations in connection with the relocation and consolidation of certain of our studio facilities; (ii) our obligation to provide a letter of credit; and (iii) obligations to increase our interest in certain partnerships.

(e) In addition to the above, purchase obligations of $270.2 million include contracts primarily for on-air personalities, sports programming rights, ratings services, music licensing fees, equipment maintenance and certain other operating contracts.

(3) Included within total other long-term liabilities of $249.3 million are deferred income tax liabilities of $238.6 million that are recognized for all temporary differences between the tax and financial reporting bases of our assets and liabilities based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Deferred tax liabilities may vary according to changes in tax laws, tax rates and our operating results. As a result, it is impractical to determine whether there will be a cash impact to an individual year. Therefore, deferred income tax liabilities have been reflected in the above table in the column labeled as “More Than 5 Years.”

Off-Balance Sheet Arrangements

We utilize letters of credit to back certain payment and performance obligations. Letters of credit are subject to limits based on amounts outstanding under our Bank Revolver.

We enter into interest rate swap contracts to hedge a portion of our variable rate debt. See Note 7 in the accompanying condensed consolidated financial statements for a detailed discussion of our derivative instruments.

Under our pending transactions to acquire and dispose of radio station assets, we determined that FIN 46R was not applicable as of March 31, 2007.

We do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet financial arrangements or other contractually narrow or limited purposes, at March 31, 2007. Accordingly, we are not materially exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships.

Recent Accounting Pronouncements

FAS No. 159

In February 2007, the Financial Accounting Standards Board (“FASB”) issued Financial Accounting Standard (“FAS”) No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities — Including an Amendment of FASB Statement No. 115”. FAS No. 159 permits an entity to elect fair value as the initial and subsequent measurement attribute for many financial assets and liabilities. Entities electing the fair value option would be required to recognize changes in fair value in earnings. Entities electing the fair value option are required to distinguish, on the face of the statement of financial position, the fair value of assets and liabilities for which the fair value option has been elected and similar assets and liabilities measured using another measurement attribute. FAS No. 159 is effective for us as of January 1, 2008. The adjustment to reflect the difference between the fair value and the carrying amount would be accounted for as a cumulative-effect adjustment to retained earnings as of the date of initial adoption. We are currently evaluating the impact, if any, of FAS No. 159 and its potential effect on our financial position, results of operations or cash flows.

FAS No. 157

On September 15, 2006, the FASB issued FAS No. 157, “Fair Value Measurements,” which provides guidance for using fair value to measure assets and liabilities. The standard also responds to investors’ requests for more information about: (1) the extent to which companies measure assets and liabilities at fair value; (2) the information used to measure fair value; and (3) the effect that fair value measurements have on earnings. SFAS No. 157 applies whenever another standard requires (or permits) assets or liabilities to be measured at fair value. The standard does not expand the use of fair value to any new circumstances. SFAS No. 157 is effective for us as of January 1, 2008. We are currently evaluating SFAS No. 157 and its potential effect on our financial position, results of operations or cash flows.

FIN 48

On July 13, 2006, the FASB issued FIN 48, “Accounting for Uncertainty in Income Taxes, and Related Implementation Issues,” that provides guidance on the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions that a company has taken or expects to take on a tax return. Under FIN 48, financial statements should reflect expected future tax consequences of such positions presuming the taxing authorities have full knowledge of the position and all relevant facts. We completed our review of the effect upon adoption on January 1, 2007 of FIN 48 and as a result, we recorded $1.8 million in expense (net of taxes) as a cumulative effect of an accounting change to our retained earnings. Of this amount, $1.1 million (net of taxes) represented interest and penalties. Subsequent to January 1, 2007, any change in interest and penalty liabilities will be reflected in the consolidated statement of operations as an adjustment to income tax expense rather than as an expense that would precede income before income taxes. Together with the previously recorded tax contingencies of $2.2 million as of December 31, 2006, our FIN 48 liabilities were $4.0 million and $4.1 million as of January 1, 2007 and March 31, 2007, respectively, which amounts were recorded in the condensed consolidated balance sheets as long-term tax liabilities. We will review our estimates on a quarterly basis and any change in our FIN 48 liabilities will result in an adjustment to our income tax expense in the consolidated statement of operations in each period measured. We anticipate that there will be no immediate impact on our cash flows.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, and the amount of reported revenues and expenses during the reporting period. We base our estimates on

historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for our making judgments about the carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates under different circumstances or using different assumptions.

We consider the following policies to be important in understanding the judgments involved in preparing our financial statements and the uncertainties that could affect our financial position, results of operations or cash flows.

Revenue Recognition

We recognize revenue from the sale of commercial broadcast time to advertisers when the commercials are broadcast, subject to meeting certain conditions such as persuasive evidence that an arrangement exists, the price is fixed and determinable, and collection is reasonably assured. These criteria are generally met at the time an advertisement is broadcast, and the revenue is recorded net of advertising agency commission.

Allowance For Doubtful Accounts

We must make an estimated allowance for doubtful accounts for estimated losses resulting from our customers’ inability to make payments to us. We specifically review historical write-off activity by market, large customer concentrations, customer creditworthiness and changes in our customer payment terms when evaluating the adequacy of the allowance for doubtful accounts. Our historical estimates have usually averaged less than 4.0% of our outstanding receivables and have been a reliable method to estimate future allowances. If the financial condition of our customers or markets were to deteriorate, resulting in an impairment of their ability to make payments, then additional allowances could be required. The effect of a 1% increase in our outstanding accounts receivable allowance as of March 31, 2007 would result in a decrease in net income of $0.5 million, net of taxes (a decrease in net loss per common share - diluted of $0.01), for the three months ended March 31, 2007.

Radio Broadcasting Licenses And Goodwill

We have made acquisitions in the past for which a significant amount of the purchase price was allocated to broadcasting licenses and goodwill assets. As of March 31, 2007, we recorded approximately $1.5 billion in radio broadcasting licenses and goodwill, which represented approximately 87.2% of our total assets. In assessing the recoverability of these assets, we must conduct annual impairment testing required by SFAS No. 142 and charge to operations an impairment expense only in the periods in which the recorded value of these assets is more than their fair value. We believe our estimate of the value of our radio broadcasting licenses and goodwill assets is a critical accounting estimate as the value is significant in relation to our total assets, and our estimate of the value contains assumptions incorporating variables that are based on past experiences and judgments about future performance of our stations. These variables would include but not be limited to: (1) the forecast growth rate of each radio market, including population, household income, retail sales and other expenditures that would influence advertising expenditures; (2) market share and profit margin of an average station within a market; (3) estimated capital start-up costs and losses incurred during the early years; (4) risk-adjusted discount rate; (5) the likely media competition within the market area; and (6) terminal values.

Changes in our estimates of the fair value of these assets could result in future period write-downs in the carrying value of our broadcasting licenses and goodwill assets.

Contingencies And Litigation

On an ongoing basis, we evaluate our exposure related to contingencies and litigation and record a liability when available information indicates that a liability is probable and estimable. We also disclose significant matters that are reasonably possible to result in a loss or are probable but not estimable.

Estimation Of Effective Tax Rates And Tax Contingencies

Significant management judgment is required in determining our provision for income taxes, income tax liabilities, deferred tax assets and liabilities and any valuation allowance recorded against net deferred tax assets. We evaluate our effective tax rates regularly and adjust rates when appropriate based on currently available information relative to statutory rates, apportionment factors and the applicable taxable income in the jurisdictions in which we operate, among other factors.

FIN 48 liabilities are also recorded to address potential exposures involving tax positions we have taken that could be challenged by taxing authorities. To the extent that we increase our liability, our provision for income taxes is

increased. If we ultimately determine that payment of these amounts is unnecessary, we reverse the liability and recognize a tax benefit during the period in which we determine that the liability is no longer necessary.

When appropriate, we record a valuation allowance against deferred tax assets to offset future tax benefits that may not be realized. In determining if a valuation allowance is appropriate, we consider whether it is more likely than not that all or some portion of our deferred tax assets will not be realized, based in part upon management’s judgments regarding future events. These potential exposures result from the varying application of statutes, rules, regulations and interpretations. We believe our estimates of the value of our FIN 48 liabilities and valuation allowances are critical accounting estimates as they contain assumptions based on past experiences and judgments about potential actions by taxing jurisdictions. It is reasonably likely that the ultimate resolution of these matters may be greater or less than the amount that we have currently accrued.

Our annual tax rates have varied in past years, with rates that ranged from 37.5% to 41.7% (exclusive of the adjustments for discrete items as described under Income Taxes). The effect of a 1% increase in our estimated tax rate, as of March 31, 2007, would result in an increase in income tax expense of under $0.1 million and an increase in net loss of under $0.1 million (net loss per common share – diluted of $0.01) for the three months ended March 31, 2007.

Intangibles

As of March 31, 2007, approximately 87.2% of our total assets consisted of radio broadcast licenses and goodwill, the value of which depends upon the operational results of our business. We could not operate the radio stations without the related FCC license for each station. FCC licenses are renewed every eight years; consequently, we continually monitor the activities of our stations to ensure they comply with all regulatory requirements. Historically, all of our licenses have been renewed at the end of their respective eight-year periods, and we expect that all licenses will continue to be renewed in the future.

Valuation Of Share-Based Compensation

We determine the fair value of restricted stock units with service conditions and market conditions using a Monte Carlo simulation model. The fair value is based on the use of certain assumptions regarding a number of highly complex and subjective variables. If other reasonable assumptions were used, the results may differ.

Inflation

Inflation has affected our performance in terms of higher costs for radio station operating expenses, including wages and equipment. The exact impact is indeterminable.

ITEM 3. Quantitative And Qualitative Disclosures About Market Risk

We are exposed to market risk from changes in interest rates on our variable rate senior debt. From time to time, we may want to protect ourselves from interest rate fluctuations through the use of derivative rate hedging instruments. If the borrowing rates under LIBOR were to increase 1% above the current rates as of March 31, 2007, our interest expense on our senior debt would increase by approximately $5.2 million on an annual basis, including any interest expense associated with the use of derivative rate hedging instruments as described below. We do not have interest rate risk related to our senior subordinated notes, which have a fixed interest rate of 7.625%.

As of March 31, 2007, we had a derivative rate hedging transaction in place for a notional amount of $30.0 million that effectively fixes LIBOR at 5.8% and expires in 2008. The fair value (based upon current market rates) of the rate hedging transaction as of March 31, 2007, is included as derivative instruments in other long-term liabilities as the maturity date of the instrument is greater than one year. Our rate hedging transaction is tied to the three-month LIBOR interest rate, which may fluctuate significantly on a daily basis. The fair value of the hedging transaction is affected by a combination of several factors, including the change in the three-month LIBOR rate and the forward interest rate to maturity. Any increase in the three-month LIBOR rate and/or the forward interest rate to maturity results in a more favorable valuation, while any decrease in the three-month LIBOR rate and/or forward interest rate to maturity results in a less favorable valuation. Our credit exposure under this hedging agreement, or similar agreements we may enter into in the future, is the cost of replacing an agreement in the event of nonperformance by our counter-party. Our derivative instrument liability as of March 31, 2007 was $0.2 million, which represented a minimal decrease from the balance as of December 31, 2006. This decrease in liability was due primarily to an increase in the forward interest rate to maturity and a decrease in the remaining period of our outstanding hedge.

Our cash equivalents are money market instruments consisting of short-term government securities and repurchase agreements that are fully collateralized by government securities. We do not believe that we have any material credit exposure with respect to these assets.

Our credit exposure related to our accounts receivable does not represent a significant concentration of credit risk due to the quantity of local advertisers with local business representing a high percentage of our business, the minimal reliance on any one advertiser, the multiple markets in which we operate and the wide variety of advertising business sectors.

See also additional disclosures regarding liquidity and capital resources made under Part 1, Item 2, Liquidity and Capital Resources above.

ITEM 4. Controls And Procedures

Evaluation Of Controls And Procedures

We maintain “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) that are designed to ensure that: (i) information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms; and (ii) such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our President/Chief Executive Officer and Executive Vice President/Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.

Changes In Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 1. Legal Proceedings

Except as described below, there have been no material developments relating to the legal proceedings described in our Annual Report on Form 10-K for the year ended December 31, 2006, filed with the Securities and Exchange Commission on February 28, 2007.

On January 25, 2007, a wrongful death suit was filed against us relating to an on-air contest. The lawsuit seeks compensatory and unspecified punitive damages, which claims may not be fully covered by our insurance policy. The local county sheriff’s department, which had initiated an investigation, recently concluded that no criminal charges will be filed. The FCC has also initiated an investigation into this contest. We cannot comment at this time on the prospects for any outcome of these proceedings.

During 2006, we received several inquiries from the FCC that were related to the FCC’s increased enforcement activity in the area of sponsorship identification and payola, which is prohibited by the Communications Act. As a result of the FCC’s investigation, on April 13, 2007, we (along with several other media companies) entered into a settlement in the form of a Consent Decree with the FCC and agreed to implement certain enhancements to our business practices and appoint a Compliance Officer to implement and monitor these practices. As part of our settlement with the FCC, we did not admit any liability and agreed to pay $4.0 million to the U.S. Treasury. For the year ended December 31, 2006, we recorded $4.0 million in our consolidated statements of operations under corporate and general and administrative expenses.

ITEM 1A. Risk Factors

There have been no material changes from the Risk Factors described in our Form 10-K, filed with the SEC on February 28, 2007.

ITEM 2. Unregistered Sales Of Equity Securities And Use Of Proceeds

During the three-month period ending March 31, 2007, we made repurchases of our Class A common stock pursuant to: (i) a one-year $100.0 million share repurchase program adopted by our Board of Directors on May 8, 2006; and (ii) elections by employees to withhold shares of stock upon vesting of restricted stock units to cover withholding tax obligations. The following table provides information on our repurchases during the quarter ended March 31, 2007:

Period	(a) Total Number of Shares Purchased	(b) Average Price Paid Per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Approximate Dollar Value of Shares That May Yet Be Purchased Under The Plans or Programs
January 1, 2007 - January 31, 2007 (1) (2)	952	$	28.11	—	$	95,214,101
February 1, 2007 - February 28, 2007 (1) (2)	40,981	$	30.36	40,981	$	95,214,101
March 1, 2007 - March 31, 2007 (1) (2)	353,305	$	28.30	353,305	$	85,214,882
Total March 2007	395,238			394,286

(1) On May 8, 2006, our Board of Directors announced the adoption of a plan to repurchase up to $100.0 million of our common stock (the “May 2006 Plan”). The May 2006 Plan was extended for another year by our Board of Directors on May 3, 2007 and will expire on May 7, 2008. Repurchases in the amount of $10.0 million (353,305 shares at an average price of $28.30 per common share) were made under the Plan during the three month period ended March 31, 2007.

(2) In connection with employee tax obligations related to the vesting of restricted stock units during the quarter ended March 31, 2007 and in accordance with elections by certain employees, the Company is deemed to have purchased the shares withheld to satisfy the employees’ tax obligations as follows: (a) in January 2007, 952 shares at an average price of $28.11 per share; and (b) in February 2007, 40,981 shares at an average price of $30.36 per share. These shares are included in the table above.

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4. Submission Of Matters To A Vote Of Security Holders

None.

ITEM 5. Other Information

None.

ITEM 6. Exhibits

Exhibit Number		Description
3.01		Amended and Restated Articles of Incorporation of the Entercom Communications Corp. (1)
3.02		Amended and Restated Bylaws of the Entercom Communications Corp. (2) (Originally filed as Exhibit 3.02)
4.01		Indenture dated as of March 5, 2002 by and among Entercom Radio, LLC and Entercom Capital, Inc., as co-issuers, the Guarantors named therein and HSBC Bank USA, as trustee. (2) (Originally filed as Exhibit 4.02)
4.02		First Supplemental Indenture dated as of March 5, 2002 by and among Entercom Radio, LLC and Entercom Capital, Inc., as co-issuers, the Guarantors named therein and HSBC Bank USA, as trustee. (2) (Originally filed as Exhibit 4.03)
10.01		Asset Exchange Agreement dated as of January 17, 2007 among Bonneville International Corporation and certain subsidiaries of Entercom Communications Corp.(3)
10.02		Entercom Non-employee Director Compensation Policy. (4)
31.01		Certification of President and Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a), as created by Section 302 of the Sarbanes-Oxley Act of 2002. (3)
31.02		Certification of Executive Vice President and Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a), as created by Section 302 of the Sarbanes-Oxley Act of 2002. (3)
32.01		Certification of President and Chief Executive Officer pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. (5)
32.02		Certification of Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. (5)

(1) Incorporated by reference to Exhibit 3.01 of our Amendment to Registration Statement on Form S-1, as filed on January 27, 1999. (File No. 333-61381)

(2) Incorporated by reference to an exhibit (as indicated above) of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2002, as filed on May 13, 2002.

(3) Filed herewith.

(4) Incorporated by reference to Item 1.01 of our Current Report on Form 8K filed on February 16, 2007.

(5) These exhibits are submitted herewith as “accompanying” this Quarterly Report on Form 10-Q and shall not be deemed to be “filed” as part of such Quarterly Report on Form 10-Q.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ENTERCOM COMMUNICATIONS CORP.
	(Registrant)


Date: May 8, 2007	/S/ David J. Field
	Name: David J. Field
	Title: President and Chief Executive Officer
	(principal executive officer)


Date: May 8, 2007	/S/ Stephen F. Fisher
	Name: Stephen F. Fisher
	Title: Executive Vice President and Chief Financial Officer
	(principal financial officer)

EXHIBIT INDEX

Exhibit Number		Description
3.01		Amended and Restated Articles of Incorporation of the Entercom Communications Corp. (1)
3.02		Amended and Restated Bylaws of the Entercom Communications Corp. (2) (Originally filed as Exhibit 3.02)
4.01		Indenture dated as of March 5, 2002 by and among Entercom Radio, LLC and Entercom Capital, Inc., as co-issuers, the Guarantors named therein and HSBC Bank USA, as trustee. (2) (Originally filed as Exhibit 4.02)
4.02		First Supplemental Indenture dated as of March 5, 2002 by and among Entercom Radio, LLC and Entercom Capital, Inc., as co-issuers, the Guarantors named therein and HSBC Bank USA, as trustee. (2) (Originally filed as Exhibit 4.03)
10.01		Asset Exchange Agreement dated as of January 17, 2007 among Bonneville International Corporation and certain subsidiaries of Entercom Communications Corp.(3)
10.02		Entercom Non-employee Director Compensation Policy. (4)
31.01		Certification of President and Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a), as created by Section 302 of the Sarbanes-Oxley Act of 2002. (3)
31.02		Certification of Executive Vice President and Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a), as created by Section 302 of the Sarbanes-Oxley Act of 2002. (3)
32.01		Certification of President and Chief Executive Officer pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. (5)
32.02		Certification of Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. (5)

(1) Incorporated by reference to Exhibit 3.01 of our Amendment to Registration Statement on Form S-1, as filed on January 27, 1999. (File No. 333-61381)

(2) Incorporated by reference to an exhibit (as indicated above) of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2002, as filed on May 13, 2002.

(3) Filed herewith.

(4) Incorporated by reference to Item 1.01 of our Current Report on Form 8K filed on February 16, 2007.

(5) These exhibits are submitted herewith as “accompanying” this Quarterly Report on Form 10-Q and shall not be deemed to be “filed” as part of such Quarterly Report on Form 10-Q.

EX-10.01 2 a07-10631_1ex10d01.htm EX-10.01

Exhibit 10.01

ASSET EXCHANGE AGREEMENT

THIS ASSET EXCHANGE AGREEMENT (this “Agreement”) is made as of January 17, 2007, by and among Entercom Cincinnati, LLC, a Delaware limited liability company, and Entercom Cincinnati License, LLC, a Delaware limited liability company (collectively, “Entercom Cincinnati”), Entercom Seattle, LLC, a Delaware limited liability company, and Entercom Seattle License, LLC, a Delaware limited liability company (collectively, “Entercom Seattle” and together with Entercom Cincinnati, “Entercom”), and Bonneville International Corporation, a Utah corporation (“Exchange Party”). Capitalized terms shall have the meaning ascribed to them in Article 18 of this Agreement.

Recitals

A. Entercom Cincinnati has entered into an asset purchase agreement (the “CBS Agreement”) with CBS Radio Stations, Inc., among other parties (collectively, the “CBS Parties”), dated August 18, 2006, pursuant to which Entercom will acquire certain authorizations issued by the Federal Communications Commission (the “FCC”) and other assets in connection with the radio broadcast stations WYGY(FM) (formerly WAQZ(FM)), Fort Thomas, Kentucky, WGRR(FM), Hamilton, Ohio, WKRQ(FM), Cincinnati, Ohio, and WUBE-FM, Cincinnati, Ohio.

B. Entercom Cincinnati has also entered into an asset exchange agreement (the “Cumulus Agreement”) with Susquehanna Radio Corp. and WVAE Lico, Inc. (collectively, the “Cumulus Parties”), dated October 31, 2006, pursuant to which Entercom Cincinnati will acquire the FCC authorizations and certain other assets of station WSWD(FM), Fairfield, Ohio, and certain assets of station WFTK(FM) (formerly WPRV(FM)), Lebanon, Ohio, in exchange for the FCC authorizations and other assets used in connection with station WGRR(FM). Radio stations WYGY(FM), WKRQ(FM), WUBE-FM, and the authorizations and other assets acquired by Entercom from the Cumulus Parties pursuant to the Cumulus Agreement, are referred to collectively as the “Entercom Cincinnati Stations”.

C. Entercom Seattle holds the FCC authorizations and other assets used in connection with radio broadcast stations KIRO(AM) and KTTH(AM), Seattle, Washington, and KBSG-FM, Tacoma, Washington (collectively, the “Entercom Seattle Stations” and together with the Entercom Cincinnati Stations, the “Entercom Stations”).

D. Bonneville Holding Company, a Utah nonprofit corporation (“BHC”), currently holds the FCC authorizations and all call letters and Exchange Party holds the other assets used in connection with radio broadcast stations KOIT-FM, KMAX-FM and KDFC-FM, San Francisco, California (collectively, the “Exchange Party Stations”).

E. Prior to the consummation of the transactions contemplated hereby, Exchange Party intends to acquire from BHC all of the FCC authorizations and all call letters relating to the Exchange Party Stations (the “BHC Agreement”).

F. Subject to the terms and conditions set forth herein, the parties desire to exchange the Entercom Station Assets for the Exchange Party Station Assets and the Cash Consideration

and the parties intend, to the maximum extent possible, that such exchange be treated as a like-kind exchange of property within the meaning of Section 1031 of the Code and the Treasury Regulations promulgated thereunder.

Agreement

NOW, THEREFORE, taking the foregoing into account, and in consideration of the mutual covenants and agreements set forth herein, the parties, intending to be legally bound, hereby agree as follows:

ARTICLE 1

EXCHANGE AND PURCHASE AND SALE OF ASSETS

1.1 Entercom Station Assets. Pursuant to the terms and subject to the conditions of this Agreement, at the Closing, Entercom shall sell, assign, transfer and convey to Exchange Party, and Exchange Party shall acquire from Entercom, all of Entercom’s right, title and interest in, to and under all of the assets, properties, interests and rights of Entercom of whatsoever kind and nature, real and personal, tangible and intangible which are used or held for use primarily in the operation of the Entercom Stations, but excluding the Entercom Excluded Assets (the “Entercom Station Assets”). Except as provided in Section 1.2, the Entercom Station Assets include without limitation the following:

(a) all licenses, permits and other authorizations issued to Entercom by the FCC with respect to the Entercom Stations, including those described on Schedule 1.1(a), and including any pending applications for or renewals or modifications thereof between the date hereof and the Closing (the “Entercom FCC Licenses”);

(b) all equipment, electrical devices, antennas, cables, tools, hardware, office furniture and fixtures, office materials and supplies, inventory, motor vehicles, spare parts and other tangible personal property of every kind and description, including without limitation those listed on Schedule 1.1(b), used or held for use primarily in the operation of the Entercom Stations, except any retirements or dispositions of tangible personal property made between the date hereof and Closing in the ordinary course of business and consistent with Section 9.1 (the “Entercom Tangible Personal Property”);

(c) all (i) contracts, agreements, leases and licenses used primarily in the operation of the Entercom Stations that are listed on Schedule 1.1(c), except to the extent otherwise indicated on such Schedule, (ii) agreements for the sale of advertising time on the Entercom Stations for cash or non-cash consideration entered into in the ordinary course of business, (iii) employment agreements with the Entercom Transferred Employees which agreements are identified in Schedule 1.1(c), and (iv) contracts and agreements permitted by Section 9.1(b) (collectively, the “Entercom Station Contracts”);

(d) to the extent transferable, all of Entercom’s rights in and to the Entercom Stations’ call letters, registered and unregistered trademarks and associated goodwill, trade names, service marks, copyrights, jingles, logos, slogans, Internet domain names, Internet URLs, Internet web sites, content and databases, computer software, programs and programming

material and other intangible property rights and interests applied for, issued to or owned by Entercom that are used primarily in the operation of the Entercom Stations, including those listed on Schedule 1.1(d) (the “Entercom Intangible Property”);

(e) all files, documents, records and books of account (or copies thereof) relating primarily to the operation of the Entercom Stations, including the Entercom Stations’ public inspection files, programming information and studies, blueprints, technical information and engineering data, advertising studies, marketing and demographic data, research studies, sales correspondence, lists of advertisers, credit and sales reports and logs, but excluding any such documents relating primarily to Entercom Excluded Assets;

(f) all interests in real property, including any leases or licenses to occupy, used or held for use primarily in the operation of the Entercom Stations described on Schedule 1.1(f) (the “Entercom Real Property”); and

(g) subject to the terms of Section 3.1(f), any barter receivables in respect of advertising time aired prior to the LMA Date.

The Entercom Station Assets shall be delivered by Entercom to Exchange Party as is, where is, without any representation or warranty by Entercom except as expressly set forth in this Agreement, and Exchange Party acknowledges that it has not relied on or been induced to enter into this Agreement by any representation or warranty other than those expressly set forth in this Agreement. The Entercom Station Assets shall be transferred to Exchange Party free and clear of liens, mortgages, pledges, security interests, claims and encumbrances (“Liens”) except for Permitted Liens, if any, and except as otherwise expressly provided in this Agreement.

1.2 Entercom Excluded Assets. Notwithstanding anything to the contrary contained herein, Exchange Party expressly acknowledges and agrees that the following assets and properties of Entercom (the “Entercom Excluded Assets”) shall not be acquired by Exchange Party and are excluded from the Entercom Station Assets:

(a) Entercom’s books and records pertaining to the corporate organization, existence or capitalization of Entercom;

(b) all cash, cash equivalents, or similar type investments of Entercom, such as certificates of deposit, treasury bills, marketable securities, asset or money market accounts or similar accounts or investments, and all monies held by or on behalf of third parties as security deposits under leases or other agreements;

(c) (i) all accounts receivable existing at the earlier of (A) the LMA Date or (B) the Effective Time, and (ii) notes receivable, promissory notes or amounts due from employees;

(d) intercompany accounts receivable and accounts payable;

(e) all insurance policies or any proceeds payable thereunder, other than as provided in Section 10.9;

(f) all pension, profit sharing or cash or deferred (Section 401(k)) plans and trusts and the assets thereof and any other employee benefit plan or arrangement;

(g) all interest in and to refunds of taxes relating to all periods prior to the Effective Time;

(h) all tangible and intangible personal property disposed of or consumed in the ordinary course between the date of this Agreement and the Closing Date as provided by this Agreement and provided that Entercom shall replace any such items consistent with its past practices;

(i) all rights to the names “Entercom,” “EMRG,” “SHRED,” “RAMP,” and “PILOT” and logos or variations thereof, including trademarks, trade names and domain names, and all goodwill associated therewith;

(j) all rights to marks not currently but previously used in the operation of the Entercom Stations, where such use has been abandoned by the Entercom Stations, and all goodwill associated therewith;

(k) the accounting and payroll systems used by Entercom and its Affiliates, whether in hard copy, stored on a computer, disk or otherwise;

(l) all ASCAP, BMI and SESAC licenses;

(m) all items of personal property owned by personnel at the Entercom Stations;

(n) any cause of action or claim relating to any event or occurrence prior to the Effective Time;

(o) all rights of Entercom under this Agreement or the transactions contemplated hereby;

(p) all assets located at Entercom’s facilities at 1100 Olive Way, Seattle, Washington, except for those assets listed on Schedule 1.1(b) and identified as Met Park assets;

(q) all assets identified as “Excluded Assets” in the CBS Agreement or as “Entercom Excluded Assets” in the Cumulus Agreement as identified on Schedule 1.2(q); and

(r) the assets identified on Schedule 1.2(r).

1.3 Exchange Party Station Assets. Pursuant to the terms and subject to the conditions of this Agreement, at the Closing, Exchange Party shall sell, assign, transfer and convey to Entercom, and Entecom shall acquire from Exchange Party, all of Exchange Party’s right, title and interest in, to and under all of the assets, properties, interests and rights of Exchange Party of whatsoever kind and nature, real and personal, tangible and intangible which are used or held for use primarily in the operation of the Exchange Party Stations, but excluding

the Exchange Party Excluded Assets (the “Exchange Party Station Assets”). Except as provided in Section 1.4, the Exchange Party Station Assets include without limitation the following:

(a) all licenses, permits and other authorizations issued to Exchange Party by the FCC with respect to the Exchange Party Stations, including those described on Schedule 1.3(a), and including any pending applications for or renewals or modifications thereof between the date hereof and the Closing (the “Exchange Party FCC Licenses”);

(b) all equipment, electrical devices, antennas, cables, tools, hardware, office furniture and fixtures, office materials and supplies, inventory, motor vehicles, spare parts and other tangible personal property of every kind and description, including without limitation those listed on Schedule 1.3(b), used or held for use primarily in the operation of the Exchange Party Stations, except any retirements or dispositions of tangible personal property made between the date hereof and Closing in the ordinary course of business and consistent with Section 9.2 (the “Exchange Party Tangible Personal Property”);

(c) all (i) contracts, agreements, leases and licenses used primarily in the operation of the Exchange Party Stations that are listed on Schedule 1.3(c), except to the extent otherwise indicated on such Schedule, (ii) agreements for the sale of advertising time on the Exchange Party Stations for cash or non-cash consideration entered into in the ordinary course of business, (iii) employment agreements with the Exchange Party Transferred Employees and which agreements are identified in Schedule 1.3(c), and (iv) contracts and agreements permitted by Section 9.2(b) (collectively, the “Exchange Party Station Contracts”);

(d) to the extent transferable, all of Exchange Party’s rights in and to the Exchange Party Stations’ call letters, registered and unregistered trademarks and associated goodwill, trade names, service marks, copyrights, jingles, logos, slogans, Internet domain names, Internet URLs, Internet web sites, content and databases, computer software, programs and programming material and other intangible property rights and interests applied for, issued to or owned by Exchange Party that are used primarily in the operation of the Exchange Party Stations, including those listed on Schedule 1.3(d) (the “Exchange Party Intangible Property”);

(e) all files, documents, records and books of account (or copies thereof) relating primarily to the operation of the Exchange Party Stations, including the Exchange Party Stations’ public inspection files, programming information and studies, blueprints, technical information and engineering data, advertising studies, marketing and demographic data, research studies, sales correspondence, lists of advertisers, credit and sales reports and logs, but excluding any such documents relating primarily to the Exchange Party Excluded Assets;

(f) all interests in real property, including any leases or licenses to occupy, used or held for use primarily in the operation of the Exchange Party Stations described on Schedule 1.3(f) (the “Exchange Party Real Property”);

(g) subject to the terms of Section 3.1(f), any barter receivables in respect of advertising time aired prior to the LMA Date; and

(h) all of Exchange Party’s membership interest in Bay City Media, LLC, a Delaware limited liability company.

The Exchange Party Station Assets shall be delivered by Exchange Party to Entercom as is, where is, without any representation or warranty by Exchange Party except as expressly set forth in this Agreement, and Entercom acknowledges that it has not relied on or been induced to enter into this Agreement by any representation or warranty other than those expressly set forth in this Agreement. The Exchange Party Station Assets shall be transferred to Entercom free and clear of Liens except for Permitted Liens, if any, and except as otherwise expressly provided in this Agreement.

1.4 Exchange Party Excluded Assets. Notwithstanding anything to the contrary contained herein, Entercom expressly acknowledges and agrees that the following assets and properties of Exchange Party (the “Exchange Party Excluded Assets”) shall not be acquired by Entercom and are excluded from the Exchange Party Station Assets:

(a) Exchange Party’s books and records pertaining to the corporate organization, existence or capitalization of Exchange Party;

(b) all cash, cash equivalents, or similar type investments of Exchange Party, such as certificates of deposit, treasury bills, marketable securities, asset or money market accounts or similar accounts or investments, and all monies held by or on behalf of third parties as security deposits under leases or other agreements;

(c) (i) all accounts receivable existing at the earlier of (A) the LMA Date or (B) the Effective Time, and (ii) notes receivable, promissory notes or amounts due from employees;

(d) intercompany accounts receivable and accounts payable;

(e) all insurance policies or any proceeds payable thereunder, other than as provided in Section 10.9;

(f) all pension, profit sharing or cash or deferred (Section 401(k)) plans and trusts and the assets thereof and any other employee benefit plan or arrangement;

(g) all interest in and to refunds of taxes relating to all periods prior to the Effective Time;

(h) all tangible and intangible personal property disposed of or consumed in the ordinary course between the date of this Agreement and the Closing Date as provided by this Agreement and provided that Exchange Party shall replace any such items consistent with its past practices;

(i) all rights to the name “Bonneville” and logos or variations thereof, including trademarks, trade names and domain names, and all goodwill associated therewith;

(j) all rights to marks not currently but previously used in the operation of the Exchange Party Stations, where such use has been abandoned by the Exchange Party Stations, and all goodwill associated therewith;

(k) the accounting and payroll systems used by Exchange Party and its Affiliates, whether in hard copy, stored on a computer, disk or otherwise;

(l) all ASCAP, BMI and SESAC licenses;

(m) all items of personal property owned by personnel at the Exchange Party Stations;

(n) any cause of action or claim relating to any event or occurrence prior to the Effective Time;

(o) all rights of Exchange Party under this Agreement or the transactions contemplated hereby;

(p) all of the tangible assets identified on Schedule 1.4(p), which may be conveyed to AIM Broadcasting-San Francisco, L.L.C. (“AIM”) pursuant to the terms of a letter of intent by and among Exchange Party and AIM (the “AIM Transaction”); and

(q) the assets identified on Schedule 1.4(q).

1.5 Cash Consideration. At the Closing, Exchange Party shall pay to Entercom, by wire transfer of immediately available funds to an account designated by Entercom, the sum of One Million Dollars ($1,000,000.00) (the “Cash Consideration”).

1.6 LMA.

(a) Contemporaneously with the execution of this Agreement, Entercom and Exchange Party shall enter into a local marketing agreement, effective as of the fifth (5th) business day following expiration or termination of the waiting period under the HSR Act (the “LMA Date”), in the form attached hereto as Exhibit A, pursuant to which Exchange Party will provide programming for, and be entitled to receive revenues from the sale of advertising on, the Entercom Stations (the “Entercom Station LMA”).

(b) Contemporaneously with the execution of this Agreement, Entercom and Exchange Party shall enter into a local marketing agreement, effective as of the LMA Date, in the form attached hereto as Exhibit B, pursuant to which Entercom will provide programming for, and be entitled to receive revenue from the sales of advertising on, the Exchange Party Stations (the “Exchange Party Station LMA” and together with the Entercom Station LMA, the “LMAs”).

(c) Contemporaneously with the execution of this Agreement, Entercom and Exchange Party are executing and delivering the LMAs. To the extent that any Entercom Station Assets are assigned, any Entercom Assumed Obligations are assumed, or assets and liabilities are prorated under the LMAs, any obligation of Entercom under this Agreement to assign such Entercom Station Assets, of Exchange Party to assume such Entercom Assumed Obligations, or of either party to prorate such assets or liabilities, shall be deemed satisfied. To the extent that any Exchange Party Station Assets are assigned, any Exchange Party Assumed Obligations are assumed, or assets and liabilities are prorated under the LMAs, any obligation of Exchange Party

under this Agreement to assign such Exchange Party Station Assets, of Entercom to assume such Exchange Party Assumed Obligations, or of either party to prorate such assets or liabilities, shall be deemed satisfied.

(d) Notwithstanding anything contained herein to the contrary, Entercom shall not be deemed to have breached any of its representations, warranties, covenants or agreements contained herein or to have failed to satisfy any condition precedent to Entercom’s obligation to perform under this Agreement (nor shall Entercom have any liability or responsibility to Exchange Party in respect of any such representations, warranties, covenants, agreements or conditions precedent), in each case to the extent that the inaccuracy of any such representations, the breach of any such warranty, covenant or agreement or the inability to satisfy any such condition precedent arises out of or otherwise relates to (i) any actions taken by or under the authorization of Exchange Party or any of its Affiliates (or any of its respective officers, directors, employees, agents or representatives) in connection with Exchange Party’s performance of its obligations under the LMAs or (ii) the failure of Exchange Party to perform any of its obligations under the LMAs.

(e) Notwithstanding anything contained herein to the contrary, Exchange Party shall not be deemed to have breached any of its representations, warranties, covenants or agreements contained herein or to have failed to satisfy any condition precedent to Exchange Party’s obligation to perform under this Agreement (nor shall Exchange Party have any liability or responsibility to Exchange Party in respect of any such representations, warranties, covenants, agreements or conditions precedent), in each case to the extent that the inaccuracy of any such representations, the breach of any such warranty, covenant or agreement or the inability to satisfy any such condition precedent arises out of or otherwise relates to (i) any actions taken by or under the authorization of Entercom or any of its Affiliates (or any of its respective officers, directors, employees, agents or representatives) in connection with Entercom’s performance of its obligations under the LMAs or (ii) the failure of Entercom to perform any of its obligations under the LMAs.

(f) Entercom and Exchange Party both acknowledge and agree that the other party shall not be deemed responsible for or have authorized or consented to any action or failure to act on the part of the other party or its Affiliates (or any of its respective officers, directors, employees, agents or representatives) in connection with the LMAs solely by reason of the fact that prior to Closing, Entercom and Exchange Party shall have the legal right to control, manage and supervise the operation of the Exchange Party Stations and Entercom Stations, respectively, and the conduct of its respective business, except to the extent Entercom or Exchange Party actually exercise control, management or supervision of the operation of their stations or the conduct of such business.

ARTICLE 2

ASSUMPTION OF OBLIGATIONS

2.1 Entercom Assumed Obligations. At the Closing, Entercom shall assume and agrees to pay, discharge and perform the following (collectively, the “Entercom Assumed Obligations”):

(a) all liabilities, obligations and commitments of Exchange Party under the Exchange Party Station Contracts to the extent they accrue or relate to any period at or after the Effective Time;

(b) all liabilities, obligations and commitments relating to Exchange Party Transferred Employees as provided for in Section 10.4; and

2.2 Exchange Party Retained Obligations. Unless otherwise required pursuant to the Exchange Party Station LMA, Entercom does not assume or agree to discharge or perform and will not be deemed by reason of the execution and delivery of this Agreement or any agreement, instrument or document delivered pursuant to or in connection with this Agreement or otherwise by reason of the consummation of the transactions contemplated hereby, to have assumed or to have agreed to discharge or perform, any liabilities, obligations or commitments of Exchange Party of any nature whatsoever whether accrued, absolute, contingent or otherwise and whether or not disclosed to Entercom, other than the Entercom Assumed Obligations (the “Exchange Party Retained Obligations”).

2.3 Exchange Party Assumed Obligations. At the Closing, Exchange Party shall assume and agrees to pay, discharge and perform the following (collectively, the “Exchange Party Assumed Obligations”):

(a) all liabilities, obligations and commitments of Entercom under the Entercom Station Contracts to the extent they accrue or relate to any period at or after the Effective Time;

(b) all liabilities, obligations and commitments relating to Entercom Transferred Employees as provided for in Section 10.4; and

2.4 Entercom Retained Obligations. Unless otherwise required by the Entercom Station LMA, Exchange Party does not assume or agree to discharge or perform and will not be deemed by reason of the execution and delivery of this Agreement or any agreement, instrument or document delivered pursuant to or in connection with this Agreement or otherwise by reason of the consummation of the transactions contemplated hereby, to have assumed or to have agreed to discharge or perform, any liabilities, obligations or commitments of Entercom of any nature whatsoever whether accrued, absolute, contingent or otherwise and whether or not disclosed to Exchange Party, other than the Exchange Party Assumed Obligations (the “Entercom Retained Obligations”).

ARTICLE 3

PRORATIONS AND ADJUSTMENTS

3.1 Prorations and Adjustments.

(a) Except as provided in the LMAs, as of 11:59 p.m. on the date immediately preceding the Closing Date (the “Effective Time”), all operating income (meaning all operating revenues less all operating expenses, as such amounts are calculated in compliance with generally accepted accounting principles (“GAAP”) applied in a manner consistent with the preparation of both Entercom’s and Exchange Party’s financial statements previously furnished to each other, except with regard to any materiality limitations or qualifications imposed thereby), arising from the conduct of the business and operations of the Entercom Stations and Exchange Party Stations will be prorated between Entercom and Exchange Party in accordance with GAAP.

(b) Except as provided in the LMAs, with respect to the Entercom Station LMA, such prorations shall be based upon the principle that Entercom is entitled to all operating revenue earned and is responsible for operating expenses paid or accruing in connection with the Entercom Stations’ operations, assigned contracts and other agreements and Entercom Transferred Employees prior to the Effective Time, and Exchange Party is entitled to such operating revenue earned, and is responsible for such operating expenses accruing on and after the Effective Time so long as this Agreement remains in effect. All special assessments and similar charges or liens imposed against Entercom Stations’ interests in real estate and/or equipment in respect of any period of time up to Effective Time, whether payable in installments or otherwise, shall be the responsibility of Entercom, and amounts payable with respect to such special assessments, charges or liens in respect of any period of time during the term of the Entercom Station LMA shall be the responsibility of Exchange Party, and such charges shall be adjusted as required hereunder.

(c) Except as provided in the LMAs, with respect to the Exchange Party Station LMA, such prorations shall be based upon the principle that Exchange Party is entitled to all operating revenue earned and is responsible for operating expenses paid or accruing in connection with the Exchange Party Stations’ operations, assigned contracts and other agreements and Exchange Party Transferred Employees prior to the Effective Time, and Entercom is entitled to such operating revenue earned, and is responsible for such operating expenses accruing on and after the Effective Time so long as this Agreement remains in effect. All special assessments and similar charges or liens imposed against Exchange Party Stations’ interests in real estate and/or equipment in respect of any period of time up to Effective Time, whether payable in installments or otherwise, shall be the responsibility of Exchange Party , and amounts payable with respect to such special assessments, charges or liens in respect of any period of time during the term of the Exchange Party Station LMA shall be the responsibility of Entercom, and such charges shall be adjusted as required hereunder.

(d) There shall be no proration with respect to vacation days of Entercom Transferred Employees, as Entercom will pay for such vacation days in cash to the Entercom Transferred Employees effective as of the Effective Time. There shall be no proration with

respect to vacation days of Exchange Party Transferred Employees, as Exchange Party will pay for such vacation days in cash to the Exchange Party Transferred Employees effective as of the Effective Time. There shall be no proration for either Entercom Transferred Employee sick leave or for Exchange Party Transferred Employee sick leave.

(e) Sales persons’ commissions and bonuses (but excluding any stay or other bonus granted by Entercom or Exchange Party that is paid or payable in whole or in part as a result of or in connection with the sale of the Entercom Stations, the Exchange Party Stations or this Agreement) for the Entercom Transferred Employees or Exchange Party Stations will be prorated.

(f) Within sixty (60) days after the Effective Time, Exchange Party and Entercom shall deliver to each other a statement of proposed apportionment based on the foregoing provisions of the Section 3.1. Exchange Party and Entercom shall use reasonable efforts to finalize all apportionments within ninety (90) days after the Effective Date (the “Payment Date”), but will exchange other apportionment statements as may be required up to and through one hundred eighty (180) days after the Effective Time, and Exchange Party shall pay to Entercom, or Entercom shall pay to Exchange Party, any amount due as a result of the adjustment(s). If a party disagrees with an apportionment statement of the other party, it must notify the other party in writing of its disagreement within thirty (30) days of receipt of such apportionment statement and such dispute notification shall specify in detail the items of disagreement and the reasons for disagreement. If, within the 30-day period above, either party disputes the other’s determination, or if during the 30-day period after delivery of a statement of determinations or payment, either Party determines that any item included in the apportionments is inaccurate, or that an additional item should be included in the apportionments, the parties shall confer with regard to the matter and an appropriate adjustment and payment shall be made as agreed upon by the parties. Each party will provide the other with reasonable access to the party’s related books, records and work papers for purposes of confirming any statement of determination or payment. If the parties are unable to resolve the matter within thirty (30) days after notice of a dispute, the matter shall be resolved by an independent certified public accountant mutually acceptable to the parties (the “CPA”), and the fees and expenses of such accountant shall be paid one-half (1/2) by Entercom and one-half (1/2) by Exchange Party. The decision of the CPA shall be final and binding on all of the parties and enforceable in a court of competent jurisdiction. Except as specified in the preceding sentence, the cost of any arbitration by the CPA (including the fees and expenses of the CPA) pursuant to this Section 3.1(f) shall be borne by Entercom and Exchange Party in inverse proportion as they may prevail on matters resolved by the CPA, which proportional allocations shall also be determined by the CPA at the time the determination of the CPA is rendered on the matters submitted. All amounts due pursuant to this subsection that are not paid by the Payment Date shall bear interest from the Payment Date until paid at a rate per annum equal to the prime rate as of the Payment Date (as published in the Money Rates column of the Eastern Edition of The Wall Street Journal). Notwithstanding the foregoing, there shall be no proration on account of trade agreements except to the extent that, as determined in accordance with GAAP, the aggregate net liability for the contracted balance of the air time under all such trade agreements remaining as of the Effective Time exceeds the contracted balance of the consideration remaining to be received by Exchange Party or Entercom on or after the Effective Time under all such trade agreements by more than Twenty-Five Thousand Dollars ($25,000.00).

ARTICLE 4

CLOSING

4.1 Closing. The consummation of the transactions described in this Agreement (the “Closing”) shall occur on a date (the “Closing Date”) within ten (10) business days after the conditions in Sections 11.2 and 12.2 are satisfied (unless the parties otherwise agree to a different Closing Date), provided all other conditions precedent described in Articles 11 and 12 hereof have either been satisfied or waived, or if such conditions have not been satisfied or waived, within ten (10) business days after the day on which all such conditions precedent have been satisfied or waived (unless the parties otherwise agree to a different Closing Date). The Closing shall take place by electronic or other exchange of documents to be delivered at the Closing.

ARTICLE 5

GOVERNMENTAL CONSENTS

5.1 Application for FCC Consent.

(a) Each of Entercom and the Exchange Party agree to use their commercially reasonable efforts and to cooperate with each other in preparing, filing and prosecuting an assignment (the “Assignment”) of the Entercom FCC Licenses to the Exchange Party, and the Exchange Party FCC Licenses to Entercom and in causing the grant by the FCC of its approval, without any condition which Entercom reasonably determines is materially adverse to Entercom, or Exchange Party reasonably determines is materially adverse to Exchange Party, of such Assignment (the “FCC Consent”) and in causing the FCC Consent to become a Final Order. The parties hereto shall cooperate with each other to file the appropriate FCC application forms (the “FCC Application”) along with all information, data, exhibits, resolutions, statements and other materials necessary and proper in connection with such FCC Application within ten (10) business days after the execution of this Agreement. Each party further agrees to expeditiously prepare and file with the FCC any amendments or any other filings required by the FCC in connection with the FCC Application whenever such amendments or filings are required by the FCC or its rules. For purposes of this Agreement, each party shall be deemed to be using its commercially reasonable efforts with respect to obtaining the Final Order, and to be otherwise complying with the foregoing provisions of this Section 5.1, so long as it truthfully and promptly provides information necessary in completing the application process, timely provides its comments on any filing materials, and uses its commercially reasonable efforts to oppose attempts by third parties to petition to deny, to resist, modify or overturn the grant of the FCC Application without prejudice to the parties’ termination rights under this Agreement, it being further understood that neither Entercom nor Exchange Party shall be required to expend any funds or efforts contemplated under this Article 5 unless the other of them is concurrently and likewise complying with its obligations under this Article 5. If either party becomes aware of any fact relating to it which would prevent or delay the FCC Consent, such party shall promptly notify the other party thereof and take reasonable steps as necessary to remove such impediment.

(b) Entercom and Exchange Party, each at their own respective expense, shall use their respective reasonable efforts to oppose any efforts or any requests by third parties for reconsideration or review of the FCC Consent (or, as the case may be, the Final Order) by the FCC or a court of competent jurisdiction.

(c) Except as otherwise provided herein, each party will be solely responsible for the expenses incurred by it in the preparation, filing and prosecution of its respective portion of the FCC Application. All filing fees and grant fees imposed by the FCC shall be paid one-half (1/2) by Entercom and one-half (1/2) by Exchange Party.

5.2 Notice of Application. Each of Entercom and the Exchange Party shall, at its own expense, give due notice of the filing of the Assignment Application for the Entercom FCC Licenses, or, as the case my be, the Exchange Party FCC Licenses, by such means as may be required by the rules and regulations of the FCC.

5.3 Hart Scott Compliance. Each party shall make, within ten (10) business days after the date of this Agreement, all filings which are required in connection with the transactions contemplated hereby under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), including making a request for early termination of the waiting period thereunder, and shall furnish to the other party all information that the other reasonably requests in connection with such filings, and shall use its commercially reasonable efforts to cause the expiration or termination of the waiting period to occur as promptly as practicable.

5.4 Non-Disclosure of Exchange Party’s Affiliates Financial Information. Exchange Party may terminate this Agreement by written notice to Entercom in the event that the DOJ, the FTC, the FCC or any other governmental agency requires the disclosure of any financial information relating to Exchange Party’s Affiliates. Exchange Party agrees to use reasonable efforts to persuade any such governmental agency that any such required Affiliate information should not be required for approval prior to exercising this right of termination.

ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF ENTERCOM

Entercom makes the following representations and warranties to Exchange Party:

6.1 Existence and Power. Each of Entercom Cincinnati, LLC; Entercom Cincinnati License, LLC; Entercom Seattle, LLC and Entercom Seattle License, LLC is a limited liability company duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. Entercom is qualified to do business and is in good standing in each jurisdiction where such qualification is necessary. Entercom has the requisite power and authority to own and operate the Entercom Stations as currently operated.

6.2 Authorization.

(a) The execution and delivery by Entercom of this Agreement and all of the other agreements, certificates and instruments to be executed and delivered by Entercom pursuant hereto or in connection with the transactions contemplated hereby (the “Entercom

Ancillary Agreements”), the performance by Entercom of its obligations hereunder and thereunder and the consummation by Entercom of the transactions contemplated hereby and thereby are within Entercom’s limited liability company powers, and have been duly authorized by all requisite limited liability company action, on the part of Entercom.

(b) This Agreement has been, and each Entercom Ancillary Agreement will be, duly executed and delivered by Entercom. This Agreement (assuming due authorization, execution and delivery by Exchange Party) constitutes, and each Entercom Ancillary Agreement will constitute when executed and delivered by Entercom, the legal, valid and binding obligation of Entercom, enforceable against Entercom in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and general principles of equity (regardless of whether enforcement is considered in a proceeding at law or in equity).

6.3 Governmental Authorization. The execution, delivery and performance by Entercom of this Agreement and each Entercom Ancillary Agreement and the consummation of the transactions contemplated hereby and thereby require no material action by or in respect of, or material filing with or notification to, any governmental authority other than the FCC, and the U. S. Department of Justice (“DOJ”) and Federal Trade Commission (“FTC”) under the HSR Act.

6.4 Noncontravention. The execution, delivery and performance of this Agreement and each Entercom Ancillary Agreement by Entercom and the consummation of the transactions contemplated hereby and thereby do not and will not (a) violate or conflict with the organizational documents of Entercom; (b) assuming compliance with the matters referred to in Section 6.3, conflict with or violate any law or governmental order applicable to Entercom; (c) require any consent or other action by or notification to any Person under, constitute a default under, or give to any Person any rights of termination, amendment, acceleration or cancellation of any right or obligation of the CBS Parties, the Cumulus Parties or Entercom under, any provision of any Entercom Station Contract, except as disclosed on Schedule 6.4, or (d) result in the creation or imposition of any Lien on any of the Entercom Station Assets, except for Permitted Liens.

6.5 Absence of Litigation. Except as set forth on Schedule 6.5, there is no legal or administrative proceeding or action pending or, to Entercom’s knowledge, threatened against Entercom, the CBS Entities or the Cumulus Entities: (a) that in any manner challenges or seeks to prevent, enjoin, alter or delay materially the transactions contemplated by this Agreement or (b) that relates to the Entercom Station Assets or the Entercom Stations.

6.6 Financial Statements. The unaudited results of operations of the Entercom Seattle Stations for calendar years 2003, 2004 and 2005 and the first nine months of calendar year 2006 have been provided by Entercom to Exchange Party. The unaudited results of operations of the Entercom Cincinnati Stations being acquired from the CBS Parties for calendar years 2003, 2004 and 2005 and the first nine months of calendar year 2006 have been provided to Entercom by CBS Radio Stations, Inc., and have been provided by Entercom to Exchange Party. (The financial statements described in the first two sentences of this Section 6.6 are referred to as the

“Entercom Reference Financial Statements,” and the radio stations described in such two sentences are referred to as the “Entercom Reference Stations”). The Entercom Reference Financial Statements were derived from the books and records of the Entercom Reference Stations, were prepared in accordance with the internal accounting policies of Entercom, or CBS Radio Inc. and CBS Corporation, as the case may be, as applicable to financial reporting at the radio station level, and present fairly, in all material respects, the results of operations of the Entercom Reference Stations for the periods then ended consistent with the internal accounting policies of Entercom, or CBS Radio Inc. and CBS Corporation, as the case may be, as applicable to financial reporting at the radio station level. The Cumulus Parties have provided to Entercom copies of unaudited, “top-line” revenue numbers for station WFTK(FM) (the “WFTK Gross Revenues”) for the period ended December 31, 2005 , and unaudited WFTK Gross Revenues for the period ended September 30, 2006, and Entercom has provided such copies to Exchange Party. Such amounts present fairly the WFTK Gross Revenues of station WFTK(FM) for the respective periods covered thereby.

6.7 FCC Licenses.

(a) Entercom has made available to Exchange Party true, correct and complete copies of the Entercom FCC Licenses, including any and all amendments and modifications thereto. The Entercom FCC Licenses were validly issued by the FCC, as of the Closing will be validly held by Entercom and are in full force and effect. The Entercom FCC Licenses are not subject to any condition except for those conditions that appear on the face of the Entercom FCC Licenses, those conditions applicable to radio broadcast licenses generally or those conditions disclosed in Schedule 1.1(a). The Entercom FCC Licenses listed on Schedule 1.1(a) constitute all authorizations issued by the FCC necessary for the operation of the Entercom Stations as currently conducted, except for immaterial licenses ancillary to the operation of the Entercom Stations.

(b) Except as otherwise set forth on Schedule 1.1(a), the Entercom FCC Licenses have been issued or renewed for the full terms customarily issued to radio broadcast stations licensed to the states in which the Entercom Stations’ communities of license are located. Except as set forth on Schedule 1.1(a), there are no applications pending before the FCC relating to the operation of the Entercom Stations.

(c) Except as set forth on Schedule 1.1(a), the Entercom Stations are operated in compliance with the Communications Act of 1934, as amended (the “Communications Act”) and the Entercom FCC Licenses, all applications, reports and other disclosures required by the FCC to be filed in respect of the Entercom Stations, and all FCC regulatory fees in respect thereof, have been timely filed or paid, except where the failure to do so could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Entercom Station Assets.

(d) Except as set forth on Schedule 1.1(a), to the knowledge of Entercom after due inquiry by its FCC counsel and consultation by Entercom with such counsel, there are no petitions, complaints, orders to show cause, notices of violation, notices of apparent liability, notices of forfeiture, proceedings or other actions pending or threatened before the FCC relating to the Entercom Stations that would reasonably be expected to have a material adverse effect on

the operation of the Entercom Stations, other than proceedings affecting the radio broadcast industry generally.

6.8 Tangible Personal Property. Except as disclosed on Schedule 6.8, as of the Closing Entercom will have title to the Entercom Tangible Personal Property free and clear of Liens other than Permitted Liens. Except as disclosed on Schedule 6.8, the Entercom Tangible Personal Property is in normal operating condition, ordinary wear and tear excepted.

6.9 Station Contracts. To the best of Entercom’s knowledge, each of the Entercom Station Contracts is in effect and is binding upon Entercom, the Cumulus Parties, or the CBS Parties, as the case may be. To the best of Entercom’s knowledge, as of the Closing, each of the Entercom Station Contracts will be in effect and will be binding upon Entercom and, to Entercom’s knowledge, the other parties thereto (subject to bankruptcy, insolvency, reorganization or other similar laws relating to or affecting the enforcement of creditors’ rights generally). To the best of Entercom’s knowledge, neither Entercom, the Cumulus Parties, nor the CBS Parties, as the case may be, is in material default under any Entercom Station Contracts. To the best of Entercom’s knowledge, as of the Closing, Entercom will not be in material default under any Entercom Station Contract, and, to Entercom’s knowledge, no other party to any of the Entercom Station Contracts is in default thereunder in any material respect. To the best of Entercom’s knowledge, except as otherwise set forth on Schedule 1.1(c), Entercom has provided to Exchange Party prior to the date of this Agreement true and complete copies of all material Entercom Station Contracts.

6.10 Intangible Property. Schedule 1.1(d), contains a description of all owned and/or registered Entercom Intangible Property. Except as set forth on Schedule 1.1(d), neither Entercom, nor the Cumulus Parties or the CBS Parties, has received no notice of any claim that its use of any material Entercom Intangible Property infringes upon or conflicts with any third party rights. Entercom, the Cumulus Parties or the CBS Parties, as the case may be, own or have the right to use the Entercom Intangible Property free and clear of Liens other than Permitted Liens. As of Closing Entercom will own or have the right to use the Entercom Intangible Property free and clear of Liens other than Permitted Liens.

6.11 Real Property.

(a) As of the Closing, Entercom will have fee simple title to the Entercom Real Property identified on Schedule 6.11(a), and a valid leasehold interest in or license to use the Entercom Real Property identified on Schedule 6.11(a), free and clear of all Liens other than the Permitted Liens. Except as set forth on Schedule 6.11(a), the Entercom Real Property includes sufficient access to the Entercom Stations’ facilities. To Entercom’s knowledge, the Entercom Real Property is not subject to any suit for condemnation or other taking by any public authority. Neither Entercom, nor the Cumulus Parties or the CBS Parties, has received notice of default under or termination of any lease for the Entercom Real Property, and neither Entercom, nor the Cumulus Parties or the CBS Parties, has knowledge of any default under any such lease. Entercom has delivered to Exchange Party true and correct copies of the Entercom Real Property Leases together with all amendments thereto. Except as set forth on Schedule 1.1(c) or Schedule 1.1(f), Entercom has not granted any oral or written right to any Person to lease, sublease, license or otherwise occupy any of the Entercom Real Property. Except as set forth on Schedule 1.1(f),

neither Entercom, nor the Cumulus Parties or the CBS Parties, has knowledge of any violations of zoning laws or any encroachments with respect to any owned Entercom Real Property either (a) for which there is not a valid easement or license, or (b) which would have a material adverse effect on such Entercom Real Property.

(b) With respect to the real property owned in fee simple by Entercom in Seattle and which real property is being conveyed to Exchange Party (the “Seattle Real Property”), except for the Permitted Liens and as disclosed on Schedule 6.11(b) hereto, Entercom has good, marketable and indefeasible fee ownership, right, title and interest to the Seattle Real Property including the right to transfer such assets. Except for Permitted Liens and items disclosed on Schedule 6.11(b), none of the Seattle Real Property or any of the income or revenue therefrom is subject to any mortgage, conditional sale agreement, security interest, lease, lien, hypothecation, pledge, encumbrance, restriction, liability, charge, claim or imperfection of title. Except as otherwise provided on Schedule 6.11(b), all items disclosed on such Schedule shall be removed or satisfied by Entercom at or before Closing.

(c) Schedule 6.11(c) contains a true and complete list of all of the Seattle Real Property used in the operation of the Entercom Stations, setting forth the address or location, and legal description for each parcel of Seattle Real Property. There are no outstanding options or rights of first refusal to purchase or lease the Seattle Real Property or any portion thereof or interest therein, and no other parties are in possession of any of the Seattle Real Property, except as set forth on Schedule 6.11(c). The Seattle Real Property has vehicular access to a road and is supplied with utilities and other services necessary for the operation of that portion of the business of each Entercom Station conducted there. To Entercom’s knowledge, (i) the main transmitting towers, related improvements, guy anchors of the main transmitting towers, and the transmitter buildings used by Entercom in the operation of each of the relevant Entercom Stations (i.e., KIRO(AM) and KTTH(AM)) are located entirely on the Seattle Real Property, (ii) the improvement of Entercom upon the Seattle Real Property and the current use and operation of such premises by Entercom conform in all material respects to all restrictive covenants, conditions, easements, building, subdivision and similar codes and federal, state and local laws, regulations, rules, orders and ordinances and Entercom has not received any notice of any violation or claimed violation of any such restrictive covenant, condition or easement, or any building, subdivision or similar code, or any federal, state or local law, regulation, rule, order or ordinance which, either individually or in the aggregate, could reasonably be expected to have a material adverse effect on the relevant Entercom Station Assets or financial condition of the relevant Entercom Stations, (iii) there is no plan, study or effort by any governmental authority or agency with respect to the Seattle Real Property which could reasonably be expected to have a material adverse effect on the relevant Entercom Station Assets or financial condition of the relevant Entercom Stations, and (iv) there are no latent defects in the Seattle Real Property which could reasonably be expected to have a material adverse effect on the relevant Entercom Station Assets or the financial condition of the relevant Entercom Stations. Except as set forth in Schedule 6.11(c), the ground system for each AM station included in the Entercom Seattle Stations is complete and contains the requisite number of ground radials, and the ground system for each AM station included in the Entercom Seattle Stations is accessible and fully contained within Seattle Real Property. Each AM station that is included within the Entercom Seattle Stations operates within licensed parameters in both daytime and nighttime transmission, and its proofs of performance are current and complete and indicate such compliance. Entercom’s

improvements upon the Seattle Real Property are in adequate operating condition and repair, normal wear and tear excluded. Entercom has no knowledge and has received no notice (i) of any pending, threatened, or contemplated action to take by eminent domain or otherwise to condemn any portion of the Seattle Real Property or interest therein, or (ii) of any levied, threatened or proposed assessments for public improvements with respect to the Seattle Real Property.

6.12 Environmental.

(a) Except as set forth on Schedule 6.12, to Entercom’s knowledge, no hazardous or toxic substance or waste regulated under any applicable Environmental Law has been generated, stored, transported or released on, in, from or to the Entercom Real Property in violation of any applicable Environmental Law. Except as set forth on Schedule 6.12, (a) the Entercom Stations have complied in all material respects with all Environmental Laws applicable to any of the Entercom Real Property, (b) there are no underground storage tanks used by the Entercom Stations in their operations, (c) to Entercom’s knowledge, there are no underground storage tanks (including underground storage tanks no longer in use) located on the owned Entercom Real Property, and (d) to Entercom’s knowledge, there is no friable asbestos or PCBs contained in any of the Entercom Station Assets in material violation of any applicable Environmental Laws. To Entercom’s knowledge, it has delivered to Exchange Party true and complete copies of all environmental assessments or reports in its possession, or in the Cumulus Parties’ or the CBS Parties’ possession, relating to the Entercom Real Property. “Environmental Laws” as used in this Section 6.12, are those environmental, health or safety laws and regulations applicable to the Entercom Stations’ activities at the Entercom Real Property in effect.

(b) To the knowledge of Entercom, except as disclosed on Schedule 6.12, (a) none of the Seattle Real Property contains (i) any asbestos, polychlorinated biphenals or any PCB contaminated oil; (ii) any Contaminants; or (iii) any underground storage tanks; (b) no underground storage tank disclosed on Schedule 6.12 has leaked and has not been remediated and such tank is in substantial compliance with all applicable Environmental Laws; and (c) all of the Seattle Real Property is in substantial compliance with all applicable Environmental Laws.

6.13 Employee Information.

(a) Schedule 6.13 contains a true and complete list of all of the employees of the Entercom Stations as of December 31, 2006 (the “Entercom Employees”), including their names, title, and station affiliation.

(b) The Entercom Stations are not subject to or bound by any labor agreement or collective bargaining agreement. Except as set forth on Schedule 6.13(b), to the knowledge of Entercom, there is no activity involving any employee of Entercom, the Cumulus Parties or the CBS Parties seeking to certify a collective bargaining unit or engaging in any other organization activity with regard to any of the Entercom Stations.

(c) With respect to the Entercom Stations, Entercom is not in violation of any federal, Washington or Ohio state law with respect to the payment of wages, overtime, expense reimbursement or other employee compensation matters.

6.14 Compliance with Laws. Except as set forth on Schedule 6.14, Entercom, and the Cumulus Parties and CBS Parties, have complied in all material respects with all laws, regulations, rules, writs, injunctions, ordinances, franchises, decrees or orders of any governmental authority that are applicable to the operation of the Entercom Stations and ownership of the Entercom Station Assets.

6.15 Taxes. All material tax returns in respect of the Entercom Stations’ business and the Entercom Station Assets have been filed, and all taxes which have become due pursuant to such tax returns or pursuant to any assessments which have become payable have been timely paid.

6.16 No Finder. Except as set forth on Schedule 6.16, no broker, finder or other Person is entitled to a commission, brokerage fee or other similar payment in connection with this Agreement, the Entercom Ancillary Agreements or the transactions contemplated hereby or thereby as a result of any agreements or action of Entercom or any party acting on Entercom’s behalf.

6.17 Sufficiency and Title to Entercom Station Assets. The Entercom Station Assets, together with the Entercom Excluded Assets, constitute all the assets primarily used or held for use in the business or operation of the Entercom Stations and necessary to operate the Entercom Stations substantially in the manner presently operated. Entercom will cause any Entercom Station Assets currently owned or held for use by an Affiliate of Entercom to be transferred to Entercom prior to the Closing. Since March 1, 2006, no material properties or assets that were or are used primarily in the operation of the Entercom Stations have been transferred or assigned by Entercom to any Affiliate of Entercom, except as set forth on Schedule 6.17.

6.18 Necessary Employees. The Entercom Employees constitute substantially all of the employees employed by Entercom in the business or operation of the Entercom Stations.

6.19 No Change in CBS Agreement or Cumulus Agreement. As of the date of this Agreement, Entercom has no knowledge of any breach or misrepresentation by the CBS Parties under the CBS Agreement or by the Cumulus Parties under the Cumulus Agreement. As of the date of this Agreement, no provision of either of the CBS Agreement or the Cumulus Agreement has been waived by Entercom and no consent pursuant to the CBS Agreement or Cumulus Agreement has been given or requested by Entercom.

6.20 Exclusivity of Representations. THE REPRESENTATIONS AND WARRANTIES MADE BY ENTERCOM IN THIS AGREEMENT OR PURSUANT TO THIS AGREEMENT IN WRITING (AND IN THE LMAs) ARE IN LIEU OF AND ARE EXCLUSIVE OF ALL OTHER REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES. ENTERCOM HEREBY DISCLAIMS ANY SUCH OTHER IMPLIED REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO EXCHANGE PARTY OR THEIR OFFICERS,

DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA). EXCEPT AS SET FORTH IN THIS AGREEMENT, ALL OF THE ENTERCOM TANGIBLE PERSONAL PROPERTY IS TO BE TRANSFERRED TO EXCHANGE PARTY WITHOUT ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR INTENDED USE OR OTHERWISE, ALL OF WHICH IS HEREBY DISCLAIMED.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES OF EXCHANGE PARTY

Exchange Party makes the following representations and warranties to Entercom:

7.1 Existence and Power. Exchange Party is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. Exchange Party is qualified to do business and is in good standing in each jurisdiction where such qualification is necessary. Exchange Party has the requisite power and authority to own and operate the Exchange Party Stations as currently operated.

7.2 Authorization.

(a) The execution and delivery by Exchange Party of this Agreement and all of the other agreements, certificates and instruments to be executed and delivered by Exchange Party pursuant hereto or in connection with the transactions contemplated hereby (the “Exchange Party Ancillary Agreements”), the performance by Exchange Party of its obligations hereunder and thereunder and the consummation by Exchange Party of the transactions contemplated hereby and thereby are within Exchange Party’s corporate powers, and have been duly authorized by all requisite corporate action, on the part of Exchange Party.

(b) This Agreement has been, and each Exchange Party Ancillary Agreement will be, duly executed and delivered by Exchange Party. This Agreement (assuming due authorization, execution and delivery by Entercom) constitutes, and each Exchange Party Ancillary Agreement will constitute when executed and delivered by Exchange Party, the legal, valid and binding obligation of Exchange Party, enforceable against Exchange Party in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and general principles of equity (regardless of whether enforcement is considered in a proceeding at law or in equity).

7.3 Governmental Authorization. The execution, delivery and performance by Exchange Party of this Agreement and each Exchange Party Ancillary Agreement and the consummation of the transactions contemplated hereby and thereby require no material action by or in respect of, or material filing with or notification to, any governmental authority other than the FCC, and the DOJ and FTC under the HSR Act.

7.4 Noncontravention. The execution, delivery and performance of this Agreement and each Exchange Party Ancillary Agreement by Exchange Party and the consummation of the

transactions contemplated hereby and thereby do not and will not (a) violate or conflict with the organizational documents of Exchange Party; (b) assuming compliance with the matters referred to in Section 7.3, conflict with or violate any law or governmental order applicable to Exchange Party; (c) require any consent or other action by or notification to any Person under, constitute a default under, or give to any Person any rights of termination, amendment, acceleration or cancellation of any right or obligation of Exchange Party under, any provision of any Exchange Party Station Contract except as disclosed on Schedule 7.4; or (d) result in the creation or imposition of any Lien on any of the Exchange Party Station Assets, except for Permitted Liens.

7.5 Absence of Litigation. Except as set forth on Schedule 7.5, there is no legal or administrative proceeding or action pending or, to Exchange Party’s knowledge, threatened against Exchange Party: (a) that in any manner challenges or seeks to prevent, enjoin, alter or delay materially the transactions contemplated by this Agreement or (b) that relates to the Exchange Party Station Assets or the Exchange Party Stations.

7.6 Financial Statements. The unaudited results of operations of the Exchange Party Stations for calendar years 2003, 2004 and 2005 and the first nine months of calendar year 2006 have been provided by Exchange Party to Entercom (the “Exchange Party Reference Financial Statements”) The Exchange Party Reference Financial Statements were derived from the books and records of the Exchange Party Stations, were prepared in accordance with the internal accounting policies of Exchange Party, as applicable to financial reporting at the radio station level, and present fairly, in all material respects, the results of operations of the Exchange Party Stations for the periods then ended consistent with the internal accounting policies of Exchange Party, as applicable to financial reporting at the radio station level.

7.7 FCC Licenses.

(a) Exchange Party has made available to Entercom true, correct and complete copies of the Exchange Party FCC Licenses, including any and all amendments and modifications thereto. The Exchange Party FCC Licenses were validly issued by the FCC, are in full force and effect and as of the Closing will be validly held by Exchange Party. The Exchange Party FCC Licenses are not subject to any condition except for those conditions that appear on the face of the Exchange Party FCC Licenses, those conditions applicable to radio broadcast licenses generally or those conditions disclosed in Schedule 1.3(a). The Exchange Party FCC Licenses listed on Schedule 1.3(a) constitute all authorizations issued by the FCC necessary for the operation of the Exchange Party Stations as currently conducted, except for immaterial licenses ancillary to the operation of the Exchange Party Stations.

(b) Except as otherwise set forth on Schedule 1.3(a), the Exchange Party FCC Licenses have been issued or renewed for the full terms customarily issued to radio broadcast stations licensed to the states in which the Exchange Party Stations’ communities of license are located. Except as set forth on Schedule 1.3(a), there are no applications pending before the FCC relating to the operation of the Exchange Party Stations.

(c) Except as set forth on Schedule 1.3(a), the Exchange Party Stations are operated in compliance with the Communications Act and the Exchange Party FCC Licenses, all applications, reports and other disclosures required by the FCC to be filed in respect of the

Exchange Party Stations, and all FCC regulatory fees in respect thereof, have been timely filed or paid, except where the failure to do so could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Exchange Party Station Assets.

(d) Except as set forth on Schedule 1.3(a), to the knowledge of Exchange Party after due inquiry by its FCC counsel and consultation by Exchange Party with such counsel, there are no petitions, complaints, orders to show cause, notices of violation, notices of apparent liability, notices of forfeiture, proceedings or other actions pending or threatened before the FCC relating to the Exchange Party Stations that would reasonably be expected to have a material adverse effect on the operation of the Exchange Party Stations, other than proceedings affecting the radio broadcast industry generally.

7.8 Tangible Personal Property. Except as disclosed on Schedule 7.8, Exchange Party has title to the Exchange Party Tangible Personal Property free and clear of Liens other than Permitted Liens. Except as disclosed on Schedule 7.8, the Exchange Party Tangible Personal Property is in normal operating condition, ordinary wear and tear excepted.

7.9 Station Contracts. To the best of Exchange Party’s knowledge, each of the Exchange Party Station Contracts is in effect and is binding upon Exchange Party. To the best of Exchange Party’s knowledge, as of the Closing, each of the Exchange Party Station Contracts will be in effect and will be binding upon Exchange Party and, to Exchange Party’s knowledge, the other parties thereto (subject to bankruptcy, insolvency, reorganization or other similar laws relating to or affecting the enforcement of creditors’ rights generally). To the best of Exchange Party’s knowledge, Exchange Party is not in material default under any Exchange Party Station Contract. To the best of Exchange Party’s knowledge, as of the Closing, Exchange Party will not be in material default under any Exchange Party Station Contracts, and to Exchange Party’s knowledge, no other party to any of the Exchange Party Station Contracts is in default thereunder in any material respect. To the best of Exchange Party’s knowledge, except as otherwise set forth on Schedule 1.3(c), Exchange Party has provided to Entercom prior to the date of this Agreement true and complete copies of all material Exchange Party Station Contracts.

7.10 Intangible Property. Schedule 1.3(d), contains a description of all owned and/or registered Exchange Party Intangible Property. Except as set forth on Schedule 1.3(d), Exchange Party has received no notice of any claim that its use of any material Exchange Party Intangible Property infringes upon or conflicts with any third party rights. Exchange Party owns or has the right to use the Exchange Party Intangible Property free and clear of Liens other than Permitted Liens.

7.11 Real Property. Exchange Party has a valid leasehold interest in or license to use the Exchange Party Real Property identified on Schedule 7.11, free and clear of all Liens other than the Permitted Liens. The Exchange Party Real Property does not include any owned real property. Except as set forth on Schedule 7.11, the Exchange Party Real Property includes sufficient access to the Exchange Party Stations’ facilities. To Exchange Party’s knowledge, the Exchange Party Real Property is not subject to any suit for condemnation or other taking by any public authority. Exchange Party has received no notice of default under or termination of any lease for the Exchange Party Real Property, and Exchange Party has no knowledge of any default under any such lease. Exchange Party has delivered to Entercom true and correct copies of the

Exchange Party Real Property Leases together with all amendments thereto. Except as set forth on Schedule 1.3(c) or Schedule 1.3(f), Exchange Party has not granted any oral or written right to any Person to lease, sublease, license or otherwise occupy any of the Exchange Party Real Property.

7.12 Environmental. Except as set forth on Schedule 7.12, to Exchange Party’s knowledge, no hazardous or toxic substance or waste regulated under any applicable Environmental Law has been generated, stored, transported or released on, in, from or to the Exchange Party Real Property in violation of any applicable Environmental Law. Except as set forth on Schedule 7.12, (a) the Exchange Party Stations have complied in all material respects with all Environmental Laws applicable to any of the Exchange Party Real Property, (b) there are no underground storage tanks used by the Exchange Party Stations in their operations, (c) to Exchange Party’s knowledge, there are no underground storage tanks (including underground storage tanks no longer in use) located on the owned Exchange Party Real Property, and (d) to Exchange Party’s knowledge, there is no friable asbestos or PCBs contained in any of the Exchange Party Station Assets in material violation of any applicable Environmental Laws. To Exchange Party’s knowledge, it has delivered to Entercom true and complete copies of all environmental assessments or reports in its possession relating to the Exchange Party Real Property. “Environmental Laws” as used in this Section 7.12, are those environmental, health or safety laws and regulations applicable to the Exchange Party Stations’ activities at the Exchange Party Real Property in effect.

7.13 Employee Information.

(a) Schedule 7.13(a) contains a true and complete list of all of the employees of the Exchange Party Stations as of December 31, 2006 (the “Exchange Party Employees”), including their names, title, and station affiliation.

(b) Except as set forth on Schedule 7.13(b), the Exchange Party Stations are not subject to or bound by any labor agreement or collective bargaining agreement. To the knowledge of Exchange Party, there is no activity involving any employee of Exchange Party seeking to certify a collective bargaining unit or engaging in any other organization activity with regard to any of the Exchange Party Stations.

(c) With respect to the Exchange Party Stations, Exchange Party is not in violation of any federal or California state law with respect to the payment of wages, overtime, expense reimbursement, or other employee compensation matters.

7.14 Compliance with Laws. Except as set forth on Schedule 7.14, Exchange Party has complied in all material respects with all laws, regulations, rules, writs, injunctions, ordinances, franchises, decrees or orders of any governmental authority that are applicable to the operation of the Exchange Party Stations and ownership of the Exchange Party Station Assets.

7.15 Taxes. All material tax returns in respect of the Exchange Party Stations’ business, and the Exchange Party Station Assets, have been filed, and all taxes which have become due pursuant to such tax returns or pursuant to any assessments which have become payable have been timely paid.

7.16 No Finder. Except as set forth on Schedule 7.16, no broker, finder or other Person is entitled to a commission, brokerage fee or other similar payment in connection with this Agreement, the Exchange Party Ancillary Agreements or the transactions contemplated hereby or thereby as a result of any agreements or action of Exchange Party or any party acting on Exchange Party’s behalf.

7.17 Sufficiency and Title to Entercom Station Assets. The Exchange Party Station Assets, together with the Exchange Party Excluded Assets, constitute all the assets primarily used or held for use by Exchange Party in the business or operation of the Exchange Party Stations and necessary to operate the Exchange Party Stations substantially in the manner presently operated. Exchange Party will cause any Exchange Party Station Assets currently owned or held for use by an Affiliate of Exchange Party to be transferred to Exchange Party prior to the Closing. Since March 1, 2006, no material properties or assets that were or are used primarily in the operation of the Exchange Party Stations have been transferred or assigned by Exchange Party to any Affiliate of Exchange Party, except as set forth on Schedule 7.17.

7.18 Necessary Employees. The Exchange Party Employees constitute substantially all of the employees employed by Exchange Party in the business or operation of the Exchange Party Stations.

7.19 Exclusivity of Representations. THE REPRESENTATIONS AND WARRANTIES MADE BY EXCHANGE PARTY IN THIS AGREEMENT OR PURSUANT TO THIS AGREEMENT IN WRITING (AND IN THE LMAs) ARE IN LIEU OF AND ARE EXCLUSIVE OF ALL OTHER REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES. EXCHANGE PARTY HEREBY DISCLAIMS ANY SUCH OTHER IMPLIED REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO ENTERCOM OR THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, ANY FINANCIAL PROJECTIONS OR OTHER SUPPLEMENTAL DATA). EXCEPT AS SET FORTH IN THIS AGREEMENT, ALL OF THE EXCHANGE PARTY TANGIBLE PERSONAL PROPERTY IS TO BE TRANSFERRED TO ENTERCOM WITHOUT ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR INTENDED USE OR OTHERWISE, ALL OF WHICH IS HEREBY DISCLAIMED.

ARTICLE 8

[INTENTIONALLY DELETED]

ARTICLE 9

COVENANTS

9.1 Entercom’s Covenants. Except as provided in the Entercom Station LMA, Entercom covenants and agrees that: (a) with respect to the Entercom Seattle Stations, between the date hereof and the Closing Date, (b) with respect to the Entercom Cincinnati Stations being

acquired pursuant to the CBS Agreement, between the date of Entercom’s acquisition of those stations (the “CBS Closing Date”) and Closing, and (c) with respect to the Entercom Cincinnati Station being acquired pursuant to the Cumulus Agreement, between the date of Entercom’s acquisition of that station (the “Cumulus Closing Date”) and Closing, except as permitted by this Agreement or with the prior written consent of Exchange Party, which shall not be unreasonably withheld, conditioned or delayed, Entercom shall:

(a) operate the Entercom Stations in the ordinary course of business consistent with Entercom’s past practice and in all material respects in accordance with the Communications Act, FCC rules and policies, and all other applicable laws, regulations, rules, policies and orders;

(b) not, other than in the ordinary course of business in accordance with Entercom’s past practice or in accordance with the terms of the Entercom Station Contracts, (i) sell, lease or dispose of or agree to sell, lease or dispose of any of the Entercom Station Assets, (ii) create, assume or permit to exist any Liens upon the Entercom Station Assets, except for Entercom Permitted Liens, or (iii) agree to the termination of any Entercom Station Contract or amendment to any Entercom Station Contract that will impose any additional liability on Exchange Party after the Closing (unless such amendment or contract can be terminated at will after Closing), or enter into any new contract that will be assumed by Exchange Party after Closing (and thus become an Entercom Station Contract) other than agreements for the sale of advertising time for cash in the ordinary course of business;

(c) furnish Exchange Party with such information relating to the Entercom Station Assets as Exchange Party may reasonably request, at Exchange Party’s expense, and provide Exchange Party with access to the Entercom Station Assets during normal business hours or at such time(s) as may be mutually convenient for the parties;

(d) maintain the Entercom FCC Licenses in full force and effect;

(e) not modify any of the Entercom FCC Licenses, except as may be provided in any pending application identified on Schedule 1.1(a), or otherwise identified on Schedule 1.1(a);

(f) cause all Liens on the Entercom Station Assets, other than Permitted Liens or Liens subject to a proration adjustment in favor of Exchange Party, to be released in full prior to or simultaneously with Closing; and

(g) Entercom shall exercise commercially reasonable efforts to close the transactions contemplated in the CBS Agreement and the Cumulus Agreement and Entercom shall fully exercise all of its rights under the CBS Agreement and the Cumulus Agreement so as to require CBS and Cumulus, respectively, to close the transactions contemplated in those agreements.

9.2 Exchange Party’s Covenants. Except as provided in the Exchange Party Station LMA, Exchange Party covenants and agrees with respect to the Exchange Party Stations that, between the date hereof and Closing, except as permitted by this Agreement or with the prior

written consent of Entercom, which shall not be unreasonably withheld, conditioned or delayed, Exchange Party shall:

(a) operate the Exchange Party Stations in the ordinary course of business consistent with Exchange Party’s past practice and in all material respects in accordance with the Communications Act, FCC rules and policies, and all other applicable laws, regulations, rules, policies and orders;

(b) not, other than in the ordinary course of business in accordance with Exchange Party’s past practice or in accordance with the terms of the Exchange Party Station Contracts, (i) sell, lease or dispose of or agree to sell, lease or dispose of any of the Exchange Party Station Assets, (ii) create, assume or permit to exist any Liens upon the Exchange Party Station Assets, except for Exchange Party Permitted Liens or (iii) agree to the termination of any Exchange Party Station Contract or amendment to any Exchange Party Station Contract that will impose any additional liability on Exchange Party after the Closing (unless such amendment or contract can be terminated at will after Closing), or enter into any new contract that will be assumed by Exchange Party after Closing (and thus become an Exchange Party Station Contract) other than agreements for the sale of advertising time for cash in the ordinary course of business;

(c) furnish Entercom with such information relating to the Exchange Party Station Assets as Entercom may reasonably request, at Entercom’s expense, and provide Entercom with access to the Exchange Party Station Assets during normal business hours or at such time(s) as may be mutually convenient for the parties;

(d) maintain the Exchange Party FCC Licenses in full force and effect;

(e) not modify any of the Exchange Party FCC Licenses, except as may be provided in any pending application identified on Schedule 1.3(a), or otherwise identified on Schedule 1.3(a);

(f) exercise reasonable best efforts to purchase the Exchange Party FCC Licenses and rights to the call signs for the Exchange Party Stations from BHC as soon as practicable; and

(g) cause all Liens on the Exchange Party Station Assets, other than Permitted Liens or Liens subject to a proration adjustment in favor of Entercom, to be released in full prior to or simultaneously with Closing.

9.3 Additional Entercom Covenants.

(a) Entercom covenants and agrees that it shall, in its capacity as “Programmer” under the Local Marketing Agreement, dated August 18, 2006, among Entercom and the CBS Parties, comply with the covenants set forth in Section 9.1 hereof during the period prior to the CBS Closing Date. Entercom further covenants and agrees to use its reasonable best efforts to cause the CBS Parties to comply with their obligations under the CBS Agreement, and to cause the transactions contemplated by the CBS Agreement to be consummated.

(b) Entercom covenants and agrees that it shall, in its capacity as “Programmer” under the Local Marketing Agreement, dated October 31, 2006, among Entercom and the Cumulus Parties, comply with the covenants set forth in Section 9.1 hereof during the period prior to the Cumulus Closing Date. Entercom further covenants and agrees to use its reasonable best efforts to cause the Cumulus Parties to comply with their obligations under the Cumulus Agreement, and to cause the transactions contemplated by the Cumulus Agreement to be consummated.

(c) Entercom shall allow Exchange Party to obtain at its expense Phase I Environmental Assessments of all or any of the Seattle Real Property it is acquiring hereunder. In the event such Phase I Environmental Assessments disclose any conditions contrary to the representations and warranties contained in Section 6.12(b), or any potential that such conditions may exist, then Exchange Party may conduct or have conducted at its expense additional testing to confirm or negate the existence of any such conditions. If any such Phase I Environmental Assessment or additional testing confirms the existence of any such conditions, Entercom will cause the conditions to be remedied to the extent required to comply with the representations and warranties set forth in Section 6.12(b) (without regard to any knowledge qualifier contained therein); provided, however, that such remedial action does not cost in excess of Five Million Dollars ($5,000,000). In the event that such remedial action does cost in excess of Five Million Dollars ($5,000,000), Entercom may elect not to take such remedial action, and, notwithstanding any other provision of this Agreement, Entercom shall have no further liability to Exchange Party for any environmental condition to the extent such condition is disclosed on Schedule 6.12(b) or any Phase I Environmental Assessment or other testing conducted pursuant to this Section 9.3(c). In such event, Exchange Party may require Entercom to proceed to Closing and Exchange Party shall receive a proration at Closing in the amount of Five Million Dollars ($5,000,000). Alternatively, Exchange Party may terminate this Agreement and Entercom shall have no liability to Exchange Party as a result of such termination. Entercom either has furnished, or will furnish within five business days after the date of execution of this Agreement, to Exchange Party copies of any environmental reports previously prepared for any of the Seattle Real Property.

(d) Entercom shall, within twenty (20) days after the execution of this Agreement at its expense, (i) commission a qualified title company to prepare and provide to Exchange Party a preliminary title report with respect to each parcel of the Seattle Real Property (each, a “Seattle Preliminary Title Report”) and Entercom shall promptly provide a copy of each such Seattle Preliminary Title Report to Exchange Party, together with complete copies of all documents relating to the title exceptions referred to in each such Seattle Preliminary Title Report, and (ii) commission a qualified surveyor to prepare and provide to Exchange Party an ALTA/ACSM Survey of each parcel of the Seattle Real Property (each, a “Seattle Survey”) depicting the location of all title exceptions. Exchange Party shall have the right to disapprove of any title exceptions other than Permitted Liens (whether or not disclosed in each Seattle Preliminary Title Report) which in Exchange Party’s reasonable discretion has a material adverse impact on the Seattle Real Property or the Exchange Party’s intended use thereof (provided, however that for purposes of this Section 9.3(d), any matters disclosed to Exchange Party on Schedules 6.11(a), 6.11(b), or 6.11(d), and any matters existing prior to the time Entercom acquired the Seattle Real Property, shall constitutue Permitted Liens) and Exchange Party shall notify Entercom of any such disapproval within twenty (20) days after receipt of each Seattle

Preliminary Title Report, as applicable, and each Seattle Survey, as applicable, by Exchange Party. All title exceptions set forth in any Seattle Preliminary Title Report and any supplemental reports or updates to any Seattle Preliminary Title Report and not disapproved by Exchange Party within the time periods provided herein shall constitute Permitted Liens. Prior to the Closing, Entercom shall, at its expense, remove or cause to be removed, all disapproved exceptions (the “Disapproved Matters”) or, in the alternative, obtain title insurance in a form satisfactory to Exchange Party insuring against the effect of such Disapproved Matters.

(e) Entercom shall use its reasonable best efforts to obtain a letter from the Federal Emergency Management Agency (“FEMA”) with respect to any underground storage tanks owned by FEMA and disclosed on Schedule 6.12(b).

9.4 Additional Exchange Party Covenant. In as much as the transactions contemplated herein will not be announced to certain employees of Exchange Party or Entercom until after this Agreement is executed, within fifteen (15) days following the execution of this Agreement, each of Entercom and the Exchange Party will make inquiry of the general manager, business manager and chief engineer of each of the Entercom Stations and the Exchange Party Stations, respectively, and will supplement, if necessary, its respective schedules hereto.

ARTICLE 10

JOINT COVENANTS

Entercom and Exchange Party hereby covenant and agree that:

10.1 Cooperation. Subject to express limitations contained elsewhere herein, each party (i) shall cooperate fully with one another in taking any commercially reasonable actions (including without limitation, commercially reasonable actions to obtain the required consent of any governmental instrumentality or any third party) necessary or helpful to accomplish the transactions contemplated by this Agreement, including but not limited to the prompt satisfaction of any condition to Closing set forth herein, and (ii) shall not take any action that conflicts with its obligations hereunder or that causes its representations and warranties to become untrue in any material respect.

10.2 Control of Station. Notwithstanding anything to the contrary in this Agreement or in the LMAs, (a) Entercom shall have authority and power over the operation of the Entercom Seattle Stations until Closing, (b) the CBS Parties shall have authority and power over the operation of the Entercom Cincinnati Stations to be acquired by Entercom under the CBS Agreement until the CBS Closing Date, and Entercom shall have such authority and power from the CBS Closing Date until Closing, (c) the Cumulus Parties shall have authority and power over the operation of the Entercom Cincinnati Station to be acquired by Entercom under the Cumulus Agreement until the Cumulus Closing Date, and Entercom shall have such authority and power from the Cumulus Closing Date until Closing, and (d) Exchange Party shall have authority and power over the operation of the Exchange Party Stations from the date hereof until Closing. The CBS Parties, the Cumulus Parties, or Entercom, as applicable, shall retain control, said control to be reasonably exercised, over the policies, programming and operations of the Entercom Stations, including, without limitation, the right to decide in the good faith exercise of its sole

discretion whether to accept or reject any programming or advertisements, the right to preempt any programming in order to broadcast a program deemed by them to be of greater national, regional, or local interest, and the right to take any other actions for compliance with the laws of the United States, the states where the Entercom Stations are located, or the rules, regulations, and policies of the FCC. Exchange Party shall retain control, said control to be reasonably exercised, over the policies, programming and operations of the Exchange Party Stations, including, without limitation, the right to decide in the good faith exercise of its sole discretion whether to accept or reject any programming or advertisements, the right to preempt any programming in order to broadcast a program deemed by Exchange Party to be of greater national, regional, or local interest, and the right to take any other actions for compliance with the laws of the United States, the State of California or the rules, regulations, and policies of the FCC.

10.3 Consents to Assignment. The parties shall use commercially reasonable efforts to obtain any third party consents necessary for the assignment of any Entercom Station Contract or Exchange Party Station Contract (which shall not require any payment to any such third party). To the extent that any such contract may not be assigned without the consent of any third party, and such consent is not obtained prior to Closing, this Agreement and any assignment executed pursuant hereto shall not constitute an assignment thereof, but to the extent permitted by law shall constitute an equitable assignment and assumption of rights and obligations thereunder, with the conveying party making available to the acquiring party the benefits thereof and the acquiring party performing the obligations thereunder on the conveying party’s behalf.

10.4 Employee Matters.

(a) Schedule 6.13 identifies all of Entercom Employees and identifies (a) certain Entercom Employees that are not available to be hired by Exchange Party, (b) certain Entercom Employees that perform functions for radio stations owned by Entercom other than the Entercom Stations as well as for the Entercom Stations (the “Entercom Shared Employees”), and (c) certain Entercom Employees that perform services exclusively for the Entercom Stations (the “Entercom Dedicated Employees”). Entercom and Exchange Party shall agree in good faith prior to the LMA Date as to the extent to which Entercom Shared Employees shall be offered employment by Exchange Party. Exchange Party agrees to make offers for employment to at least ninety-two and one-half percent (92.5%) of (i) the number of Entercom Dedicated Employees, plus (ii) the number of Entercom Shared Employees to whom Exchange Party agrees to make offers of employment pursuant to the immediately preceding sentence. The Entercom Shared Employees and Entercom Dedicated Employees that are offered and accept employment by Exchange Party shall be referred to as the “Entercom Transferred Employees”. Exchange Party agrees to identify in writing the Entercom Dedicated Employees to which it will offer employment, to be provided to Entercom consistent with the terms of this Agreement, on or before the third (3rd) business day before the LMA Date.

(b) Schedule 7.13 identifies all of Exchange Party Employees and identifies certain Exchange Party Employees that are not available to be hired by Entercom. Those employees identified on Schedule 7.13 as being available to be hired by Entercom shall be referred to as the “Exchange Party Available Employees”. Entercom agrees to make offers for employment to at least ninety-two and one-half percent (92.5%) of the Exchange Party Available

Employees effective as of the LMA Date. The Exchange Party Available Employees that are offered and accept employment by Entercom shall be referred to as the “Exchange Party Transferred Employees”. Entercom agrees to identify in writing the Exchange Party Available Employees to which it will offer employment, to be provided to Exchange Party consistent with the terms of this Agreement, on or before the third (3rd) business day before the LMA Date.

(c) With respect to any Transferred Employee who is party to an employment agreement which is an Entercom Station Contract or an Exchange Party Station Contract, as the case may be, the acquiring party shall assume such employment agreement. Notwithstanding anything to the contrary in this Agreement or the LMAs, neither party will be obligated to pay severance to employees that are terminated as a result of the transaction contemplated by this Agreement.

(d) With respect to Transferred Employees, the acquiring party shall be responsible for all compensation and benefits arising after the LMA Date, and the conveying party shall be responsible for all compensation and benefits arising on or prior to the LMA Date.

(e) Provided that the acquiring party receives an appropriate proration under the LMAs, the acquiring party shall grant credit to each Transferred Employee it hires for all unused vacation accrued as of the LMA Date, and the acquiring party shall assume and discharge all obligations to provide such vacation leave to such Transferred Employees.

(f) The acquiring party shall permit full-time Transferred Employees (and their spouses and dependents) to participate in its “employee welfare benefit plans” (including health insurance plans) and “employee pension benefit plans,” as defined in Section 3(1) and 3(2) of ERISA, respectively, to the extent similarly situated employees of the acquiring party are generally eligible to participate, with coverage effective immediately upon the LMA Date and without any exclusion on account of any pre-existing condition except to the extent they are subject to a pre-existing coverage limitation under their existing coverage; provided, however, that the acquiring party shall only be obligated to offer participation in its employee benefit plans immediately to the conveying party’s employees who are then participating in conveying party’s employee welfare benefit plans and those employees of conveying party that are not currently participating in the conveying party’s employee benefit plans will not be eligible to participate in the acquiring party’s employee benefit plans until the next open enrollment period. The acquiring party also shall ensure, to the extent permitted by applicable law (including ERISA and the Code) and its plans, that full-time Transferred Employees receive credit under any welfare benefit plan of acquiring party for any deductibles or co-payments paid by Transferred Employees and their spouses and dependents for the current plan year under a plan maintained by the conveying party. For purposes of any length of service requirements, waiting periods, vesting periods or differential benefits based on length of service in any such employee welfare benefit plans (including any severance plans or policies) and defined contribution plans for which Transferred Employees may be eligible after the LMA Date, acquiring party shall ensure, to the extent permitted by applicable law (including ERISA and the Code), that service with conveying party shall be deemed to have been service with acquiring party; provided, however, that with respect to the Exchange Party’s defined contribution plan, such credit for prior service with Entercom will be given only for the purpose of determining when an Entercom Transferred Employee will be deemed to be “vested” in benefits under the plan and not for any other

purpose, including, without limitation, for the purpose of determining the amount of any benefit that any Entercom Transferred Employee will receive under the plan.

(g) The acquiring party shall also permit each Transferred Employee who participates in conveying party’s 401(k) plan to elect to make direct rollovers of their account balances into acquiring party’s 401(k) plan as of the LMA Date, subject to compliance with applicable law and subject to the reasonable requirements of acquiring party’s 401(k) plan administrator.

(h) From the date hereof until the eighteen (18) month anniversary of the LMA Date, Entercom shall not, and shall cause its Affiliates to not, solicit, hire or attempt to hire for employment any Entercom Transferred Employees, without the prior written consent of the other party, and Entercom shall not otherwise interfere with any Entercom Transferred Employees, except with respect to any Entercom Transferred Employee who has been involuntarily terminated by Exchange Party. From the date hereof until the eighteen (18) month anniversary of the LMA Date, Exchange Party shall not, and shall cause its Affiliates to not, solicit, hire or attempt to hire for employment any Exchange Party Transferred Employees, or any other Entercom employees based in the Seattle, Washington area, without the prior written consent of the other party, and Exchange Party shall not otherwise interfere with any Exchange Party Transferred Employees or other such employees, except with respect to any Exchange Party Transferred Employee or other such employee who has been involuntarily terminated by Entercom. Nothing in this Section 10.4(f) shall limit or modify any non-compete agreement to which any Transferred Employee is party.

(i) For purposes of this Section 10.4, “acquiring party” shall mean a party to this Agreement in its capacity as acquirer of assets, and “conveying party” shall mean a party to this Agreement, or the CBS Parties or Cumulus Parties, in their capacity as transferor of assets, and “Transferred Employees” shall mean the Entercom Transferred Employees and the Exchange Party Transferred Employees, all as the context requires.

(j) The parties acknowledge that for a period of six months after the LMA Date, employees of Entercom who are currently based at the Entercom’s Eastlake premises and who do not become Transferred Employees shall continue to be based at such facilities, and that notwithstanding any other provision of this Agreement or the LMAs, during such period such employees shall continue to have the use of the space and facilities at the Eastlake premises as is reasonably necessary to perform their duties in accordance with past practice and at locations mutually acceptable to both parties; provided, however that Entercom shall use its reasonable best efforts to relocate Jerry McKenna and Dolores Pizzati to the Met Park location prior to the LMA Date.

10.5 LMA Employees. Notwithstanding the above, each party may retain at least two employees (as identified in the respective LMAs) for the market in which a station to be assigned under this Agreement is located in order to comply with the employee requirements of the Entercom Station LMA and the Exchange Party Station LMA.

10.6 Estoppel Certificates. Each party, at its own expense, shall use commercially reasonable efforts to obtain and deliver to the other party at or, as otherwise indicated herein,

before the Closing, written estoppel certificates (the “Estoppel Certificates”), dated as of the Closing Date duly executed by the lessors under the leases for leased Entercom Real Property, with respect to this obligation of Entercom, and under the leases for leased Exchange Party Real Property, with respect to this obligation of Exchange Party, in form and substance reasonably acceptable to the parties.

10.7 Lease/License Agreements. The parties shall negotiate in good faith and shall enter into, as of the Closing Date, license agreements pursuant to which, subject to any underlying lease, Entercom shall make available to Exchange Party the space at the tower structures and related premises owned by Entercom which are currently occupied by the main and auxiliary antennas and transmitting facilities of station KBSG-FM, which agreements each shall have an initial term of ten (10) years (with one additional renewal term of five years, exercisable at the option of Exchange Party), and at an aggregate license fee of Five Thousand Two Hundred Dollars ($5,200) per month for the main and auxiliary antennas and transmitting facilities, subject to increase based on the Consumer Price Index (“CPI”), with One Thousand Two Hundred Dollars ($1,200) per month being allocated toward the agreement for the Cougar Mountain facilities and Four Thousand Dollars ($4,000) per month being allocated toward the agreement for the Tiger Mountain facilities, and which agreements shall be on such other terms and conditions as are customary for agreements of this type. The parties also shall negotiate in good faith, and shall enter into as of the Closing Date, the following lease or license agreements, which shall contain terms and conditions customary in the radio broadcast industry: (a) subject to underlying leases, licenses, easements, or other rights, as applicable, a lease, license, or other grant of such rights as are necessary to maintain the current communications links for the Entercom Seattle Stations passing through Met Park, including, without limitation, rights to use the space necessary for microwave, RPU and related equipment that is currently used by the Entercom Seattle Stations and is currently located at Met Park, which lease, license or other grant or agreement shall be at no cost and shall have an initial term of ten (10) years (with one additional renewal term of five years, exercisable at the option of Exchange Party), and (b) subject to underlying leases, licenses, easements, or other rights, as applicable, a lease, license, or other grant of such rights as are necessary to maintain the current communications links on Bay View Hill for the Exchange Party Stations, including, without limitation, rights to use the space necessary for microwave and related equipment that is currently used by the Exchange Party Stations, which lease, license or other grant or agreement shall be at no cost and shall have an initial term of ten (10) years (with one additional renewal term of five years, exercisable at the option of Entercom) Such agreements shall provide that in the event the lessor or licensor thereunder sells or otherwise transfers its interest in the leased or licensed premises, the successor owner shall assume such lessor or licensor’s obligations thereunder.

10.8 Tax Matters.

(a) Subject to Section 10.8(c), the parties hereto intend that (i) Entercom’s transfer of the Entercom Station Assets that are held or used in connection with the Entercom Seattle Stations in partial exchange for the Exchange Party Stations Assets be treated by Entercom to the extent possible as a like-kind exchange of property under section 1031 of the Code and the Treasury Regulations promulgated thereunder and (ii) Exchange Party’s transfer of the Exchange Party Stations Assets in partial exchange for the Entercom Station Assets be

treated by the Exchange Party to the extent possible as a like-kind exchange of property under section 1031 of the Code and the Treasury Regulations promulgated thereunder.

(b) Entercom agrees to pay after closing any taxes imposed on Entercom with respect to periods, or portions of periods, that end before the Closing Date to the extent the non-payment of such tax would give rise to a lien or encumbrance for taxes on the Entercom Station Assets in the hands of the Exchange Party after Closing, other than taxes that are subject to a pro-ration adjustment in favor of the Exchange Party and taxes that are the Exchange Party’s responsibility under the LMAs. Exchange Party agrees to pay after closing any taxes imposed on Exchange Party with respect to periods, or portions of periods, that end before the Closing Date to the extent the non-payment of such tax would give rise to a lien or encumbrance for taxes on the Exchange Party Station Assets in the hands of Entercom after Closing, other than taxes that are subject to a pro-ration adjustment in favor of Entercom and taxes that are Entercom’s responsibility under the LMAs.

(c) Entercom and Exchange Party agree that they will separately determine the fair market value of the Entercom Station Assets and the Exchange Party Station Assets for tax and financial reporting purposes, including for purposes of Section 1060 of the Code and for purposes of preparing IRS Forms 8824 and 8594, and Entercom and Exchange Party are each permitted to file its tax returns in a manner that is inconsistent with the other party’s determination of the fair market value of such assets.

10.9 Risk of Loss.

(a) Entercom shall bear the risk of any casualty loss or damage to any of the Entercom Station Assets prior to the Closing, and Exchange Party shall bear such risk on and after the Closing. In the event of any casualty loss or damage to the Entercom Station Assets prior to the Closing, Entercom shall be responsible for repairing or replacing (as appropriate under the circumstances) any lost or damaged Entercom Station Asset (the “Entercom Damaged Asset” ) unless such Entercom Damaged Asset was obsolete and unnecessary for the continued operation of the Entercom Stations consistent with Entercom’s past practices and the Entercom FCC Licenses. If Entercom is unable to repair or replace an Entercom Damaged Asset by the date on which the Closing would otherwise occur under this Agreement, then the Closing Date shall be extended until such repair or replacement is completed. Notwithstanding the foregoing, if the reasonably estimated cost of such repair or replacement exceeds Two Million Dollars ($2,000,000), either party may terminate this Agreement by written notice to the other party.

(b) Exchange Party shall bear the risk of any casualty loss or damage to any of the Exchange Party Station Assets prior to the Closing, and Entercom shall bear such risk on and after the Closing. In the event of any casualty loss or damage to the Entercom Station Assets prior to the Closing, Exchange Party shall be responsible for repairing or replacing (as appropriate under the circumstances) any lost or damaged Exchange Party Station Asset (the “Exchange Party Damaged Asset” ) unless such Exchange Party Damaged Asset was obsolete and unnecessary for the continued operation of the Exchange Party Stations consistent with Exchange Party’s past practices and the Exchange Party FCC Licenses. If Exchange Party is unable to repair or replace an Exchange Party Damaged Asset by the date on which the Closing would otherwise occur under this Agreement, then the Closing Date shall be extended until such

repair or replacement is completed. Notwithstanding the foregoing, if the reasonably estimated cost of such repair or replacement exceeds Two Million Dollars ($2,000,000), either party may terminate this Agreement by written notice to the other party.

10.10 Cooperation Relative to Accounts Receivable.

(a) Subject to the provisions of the LMAs, following the Closing Date, each of Entercom and Exchange Party shall (i) assist the other party in the collection of the accounts receivable for a period of one-hundred twenty (120) days from the Closing Date, and (ii) endorse (without recourse) and deliver to the other party, no less often than the fifteenth (15th) day of each month following the Closing Date (each, a “Turnover Date”), any checks or other instruments payable to the other party that are received on the accounts receivable. Neither party shall be obligated to institute litigation, employ any collection agency, legal counsel or other third party, or take any extraordinary means of collection. In its collection efforts, neither party shall be liable to the other party for any loss, claim, expense or liability arising in connection with its collection activities except for willful malfeasance or gross negligence. Notwithstanding any other provision of this Section 10.10, Exchange Party acknowledges that payments with respect to certain Entercom Accounts Receivable of the Entercom Seattle Stations are made directly to an Entercom account, and Exchange Party will take no action to collect such Entercom Accounts Receivable.

(b) Entercom hereby agrees and acknowledges (i) that the Exchange Party accounts receivable (“Exchange Party Accounts Receivable”) are solely the property of Exchange Party, (ii) that all payments received by Entercom on account of the Exchange Party Accounts Receivable shall be held in trust for the benefit of Exchange Party, (iii) that payments received from customers of Entercom that owe payments to Entercom and also owe payments to Exchange Party shall be applied first and to the full extent to the Exchange Party Accounts Receivable (unless otherwise specified in good faith by the payor), and (iv) that all such payments shall be delivered to Exchange Party, together with any necessary endorsements (without recourse) thereon, on each Turnover Date. To the extent that Exchange Party has not received payment on any Accounts Receivable as of the one-hundred twentieth (120th) day following the Closing Date, Entercom shall have no further obligations or right to collect the Accounts Receivable, unless otherwise agreed upon by Exchange Party and Entercom, and Entercom shall promptly return any and all documentation related to the Accounts Receivable to Exchange Party.

(c) Exchange Party hereby agrees and acknowledges (i) that the Entercom accounts receivable (“Entercom Accounts Receivable”) are solely the property of Entercom, (ii) that all payments received by Exchange Party on account of the Entercom Accounts Receivable shall be held in trust for the benefit of Entercom, (iii) that payments received from customers of Exchange Party that owe payments to Exchange Party and also owe payments to Entercom shall be applied first and to the full extent to the Entercom Accounts Receivable (unless otherwise specified in good faith by the payor), and (iv) that all such payments shall be delivered to Entercom, together with any necessary endorsements (without recourse) thereon, on each Turnover Date. To the extent that Entercom has not received payment on any Accounts Receivable as of the one-hundred twentieth (120th) day following the Closing Date, Exchange Party shall have no further obligations or right to collect the Accounts Receivable, unless

otherwise agreed upon by Entercom and Exchange Party, and Exchange Party shall promptly return any and all documentation related to the Accounts Receivable to Entercom.

10.11 Schedules.

(a) Each party will use its commercially reasonable efforts to promptly supplement or amend its schedules hereto with respect to any matter arising after the date of this Agreement that would have been required to be set forth or described in a schedule or that is necessary to correct any information in a schedule or in any representation or warranty; provided that if the other party fails to object within fifteen (15) days after receipt of such supplement or amendment, such other party shall be deemed to have waived its rights to object to such proposed supplement or amendment. If such other party makes a timely objection pursuant to this Section 10.11, any such proposed supplement or amendment will not be permitted, except as thereafter mutually agreed; provided, however, that any such objection must be made in good faith, set forth in writing and based on the fact that such supplement or amendment (a) is not primarily related to the ordinary course of business of the station(s) involved, (b) would have a material adverse effect on the business of the station(s) involved, and/or (c) is not consistent with past practices.

(b) Within three weeks following execution of this Agreement (the “Schedule Amendment Deadline”), if Entercom identifies any additional contracts (“Entercom Additional Contracts”) relating to the operation of the Entercom Stations that it concludes should have been listed on Schedule 1.1(c), Entercom shall so notify Exchange Party and provide Exchange Party with a copy of such Entercom Additional Contracts. Exchange Party shall be deemed to have waived its rights to object to such proposed supplement or amendment unless it disputes such supplement or amendment in accordance with the terms of Section 10.11(d) of this Agreement; provided, however, that any such objection must be made in good faith, set forth in writing and based on the fact that such supplement or amendment (a) is not primarily related to the ordinary course of business of the station(s) involved, (b) would have a material adverse effect on the business of the station(s) involved, and/or (c) is not consistent with past practices. Absent such objection, the identified Entercom Additional Contract will be deemed an Entercom Station Contract and assigned to and assumed by Exchange Party as of the Closing Date, provided that such assumption shall only be to the same extent as provided in Section 1.1(c) for contracts and agreements identified on Schedule 1.1(c) hereto.

(c) On or before the Schedule Amendment Deadline, if Exchange Party identifies any additional contracts (“Exchange Party Additional Contracts”) relating to the operation of the Exchange Party Stations that it concludes should have been listed on Schedule 1.3(c), Exchange Party shall so notify Entercom and provide Entercom with a copy of such Exchange Party Additional Contracts. Entercom shall be deemed to have waived its rights to object to such proposed supplement or amendment unless it disputes such supplement or amendment in accordance with the terms of Section 10.11(d) of this Agreement; provided, however, that any such objection must be made in good faith, set forth in writing and based on the fact that such supplement or amendment (a) is not primarily related to the ordinary course of business of the station(s) involved, (b) would have a material adverse effect on the business of the station(s) involved, and/or (c) is not consistent with past practices. Absent such objection, the identified Exchange Party Additional Contract will be deemed an Exchange Party Station

Contract and assigned to and assumed by Entercom as of the Closing Date, provided that such assumption shall only be to the same extent as provided in Section 1.3(c) for contracts and agreements identified on Schedule 1.3(c) hereto.

(d) In the event that the parties have a dispute over the amendment of any of the Schedules pursuant to Sections 10.11(a), (b) or (c) above, the parties will first attempt in good faith to resolve such dispute promptly through informed discussions between the general counsels and/or chief financial officers of Entercom and Exchange Party. Any dispute not so resolved shall be resolved pursuant to discussions between the chief executive officers of Entercom and Exchange Party.

10.12 FCC Authorizations. Each party will promptly take any necessary actions to resolve and correct any discrepancies, inaccuracies or problems with respect to any of the Entercom FCC Licenses or the Exchange Party FCC Licenses, respectively, at such party’s sole expense.

ARTICLE 11

CONDITIONS OF CLOSING BY ENTERCOM

The obligations of Entercom hereunder are, at its option, subject to satisfaction, at or prior to Closing, of each of the following conditions:

11.1 Representations, Warranties and Covenants. (a) The representations and warranties of Exchange Party made in this Agreement shall be true and correct in all material respects as of the Closing Date except for (i) those representations and warranties already subject to a materiality qualification and, in that event, the representation and warranty shall be true and correct in all respects, and (ii) changes permitted or contemplated by the terms of this Agreement, and (b) the covenants and agreements to be complied with and performed by Exchange Party at or prior to Closing shall have been complied with or performed in all material respects. Entercom shall have received a certificate dated as of the Closing Date from Exchange Party, executed by an authorized officer of Exchange Party on behalf of Exchange Party to the effect that the conditions set forth in this Section 11.1 have been satisfied.

11.2 Governmental Consents. The FCC Consent shall have been obtained and shall have become a Final Order; provided that the condition as to a Final Order shall not apply (i) if no filing shall have been made with the FCC by any third party that pertains to or becomes associated with the FCC Application, or (ii) if any such filing shall have been made, then if, in the reasonable opinion of Entercom’s FCC counsel, the objection set forth in the filing would not reasonably be expected to result in a denial of the FCC Consent or a designation for hearing of the FCC Application. The waiting period under the HSR Act shall have expired or been terminated. No court or governmental order prohibiting the Closing shall be in effect. In the event that the parties close without the FCC Consent becoming a Final Order and the FCC or a court subsequently rescinds the FCC Consent, and such rescission becomes a Final Order, the parties agree to cooperate with each other and to use their best efforts to bring about, to the maximum extent possible, the fair and equitable restoration of each of the parties to its position prior to execution of this Agreement.

11.3 Required Consents. Entercom shall have received all of the consents (to the extent consent is required for assignment of such Station Contracts) to the assignment of all Exchange Party Station Contracts marked as “Material Contracts” on Schedule 1.3(f).

11.4 Other Documents. Entercom shall have received the documents specified in Section 14.2 hereof and such other documents as Entercom shall reasonably request to consummate the transactions contemplated by this Agreement.

11.5 CBS Agreement and Cumulus Agreement. The transactions contemplated by each of the CBS Agreement and the Cumulus Agreement shall have been consummated.

11.6 San Bruno Lease Renewal. Exchange Party shall have entered into a lease renewal for the KMAX-FM transmitter site facilities at San Bruno at a fair market lease rate and at a fair market term, both as determined by Exchange Party in its reasonable discretion. Exchange Party agrees that Entercom shall be permitted to participate in the negotiations for such lease renewal with the landlord of San Bruno, and Entercom and Exchange Party shall use their respective reasonable best efforts to cause this condition to have been satisfied by the date which otherwise would be the Closing Date.

ARTICLE 12

CONDITIONS OF CLOSING BY EXCHANGE PARTY

The obligations of Exchange Party hereunder are, at its option, subject to satisfaction, at or prior to Closing, of each of the following conditions:

12.1 Representations, Warranties and Covenants. (a) The representations and warranties of Entercom made in this Agreement shall be true and correct in all material respects as of the Closing Date except for (i) those representations and warranties already subject to a materiality qualification, and, in that event, the representation and warranty shall be true and correct in all respects, and (ii) changes permitted or contemplated by the terms of this Agreement, and (b) the covenants and agreements to be complied with and performed by Entercom at or prior to Closing shall have been complied with or performed in all material respects. Exchange Party shall have received a certificate dated as of the Closing Date from Entercom, executed by an authorized officer of Entercom on behalf of Entercom, to the effect that the conditions set forth in this Section 12.1 and Section 12.5 have been satisfied.

12.2 Governmental Consents. The FCC Consent shall have been obtained and shall have become a Final Order; provided that the condition as to a Final Order shall not apply (i) if no filing shall have been made with the FCC by any third party that pertains to or becomes associated with the FCC Application, or (ii) if any such filing shall have been made, then if, in the reasonable opinion of Exchange Party’s FCC counsel, the objection set forth in the filing would not reasonably be expected to result in a denial of the FCC Consent or a designation for hearing of the FCC Application. The waiting period under the HSR Act shall have expired or been terminated. No court or governmental order prohibiting Closing shall be in effect. In the event that the parties close without the FCC Consent becoming a Final Order and the FCC or a court subsequently rescinds the FCC Consent, and such rescission becomes a Final Order, the

parties agree to cooperate with each other and to use their best efforts to bring about, to the maximum extent possible, the fair and equitable restoration of each of the parties to its position prior to execution of this Agreement.

12.3 Required Consents. Exchange Party shall have received all of the consents (to the extent consent is required for assignment of such Station Contracts) to the assignment of all Entercom Station Contracts marked as “Material Contracts” on Schedule 1.1(f).

12.4 Other Documents. Exchange Party shall have received the documents specified in Section 14.1 hereof and such other documents as Exchange Party shall reasonably request to consummate the transactions contemplated by this Agreement.

12.5 CBS Agreement and Cumulus Agreement. The transactions contemplated by each of the CBS Agreement and the Cumulus Agreement shall have been consummated in accordance with the terms of such Agreements, and Entercom shall not have waived any of its rights under, or amended in any manner, either of the CBS Agreement or the Cumulus Agreement, and there shall have been no breach by the CBS Parties or Cumulus Parties thereunder, except for waivers, amendments or breaches that do not have a material adverse effect on Exchange Party, Exchange Party’s rights under this Agreement or any of the Entercom Stations Assets being acquired hereunder.

12.6 BHC Agreement. The transactions contemplated by the BHC Agreement shall have been consummated.

12.7 Queen Anne Easement Renewal. Entercom shall have entered into a renewal of the easement agreement between KIRO-TV Inc. and Entercom for the Queen Anne site at no charge and at a fair market term, as determined by Entercom in its reasonable discretion. Entercom agrees that Exchange Party shall be permitted to participate in the negotiations for such renewal with KIRO-TV Inc., and Entercom and Exchange Party shall use their respective reasonable best efforts to cause this condition to have been satisfied by the date which otherwise would be the Closing Date.

ARTICLE 13

EXPENSES

13.1 Expenses. Each party shall be solely responsible for all costs and expenses incurred by it in connection with the negotiation, preparation and performance of and compliance with the terms of this Agreement, except (i) all recordation, transfer and documentary taxes, fees and charges, and any excise, sales or use taxes, applicable to the transactions contemplated by this Agreement shall be paid equally by Entercom and Exchange Party, (ii) all FCC filing fees and filing fees under the HSR Act shall be paid equally by Entercom and Exchange Party, and (iii) as otherwise specified in this Agreement.

ARTICLE 14

ITEMS TO BE DELIVERED AT CLOSING

14.1 Entercom’s Deliveries. At Closing, Entercom shall deliver or cause to be delivered to Exchange Party:

(a) certified copies of resolutions authorizing its execution, delivery and performance of this Agreement, including the consummation of the transactions contemplated hereby;

(b) the certificate described in Section 12.1;

(c) such bills of sale, assignments, special warranty deeds, documents of title and other instruments of conveyance, assignment and transfer as may be necessary to convey, transfer and assign the Entercom Station Assets to Exchange Party, free and clear of Liens, except for Permitted Liens; and

(d) such documents and instruments of assumption as may be necessary to assume the Entercom Assumed Obligations.

14.2 Exchange Party’s Deliveries. At Closing, Exchange Party shall deliver or cause to be delivered to Entercom:

(a) the certified copies of resolutions authorizing its execution, delivery and performance of this Agreement, including the consummation of the transactions contemplated hereby;

(b) the certificate described in Section 11.1;

(c) such bills of sale, assignments, documents of title and other instruments of conveyance, assignment and transfer as may be necessary to convey, transfer and assign the Exchange Party Station Assets to Entercom, free and clear of Liens, except for Permitted Liens; and

(d) such documents and instruments of assumption as may be necessary to assume the Entercom Assumed Obligations.

ARTICLE 15

SURVIVAL; INDEMNIFICATION.

15.1 Survival. The representations, warranties, indemnities, covenants and agreements of each of the parties hereto shall survive for a period of eighteen (18) months following the Closing; provided, however, that the representations and warranties made in Sections 6.12 and 7.12, shall survive for five years after the Closing.

15.2 Indemnification.

(a) From and after the Closing, Entercom shall defend, indemnify and hold harmless Exchange Party from and against any and all losses, costs, damages, liabilities and expenses, including reasonable attorneys’ fees and expenses (“Damages”) incurred by Exchange Party arising out of or resulting from: (i) any breach or default by Entercom under this Agreement; (ii) the Entercom Retained Obligations or the business or operation of the Entercom Station before Closing; or (iii) the Entercom Assumed Obligations or the business or operation of the Exchange Party Station after Closing; provided, however, that, except for the items in (ii) and (iii) above (which shall not be subject to such limitations), (y) Entercom shall have no liability for breach of representations and warranties to Exchange Party hereunder until, and only to the extent that, Exchange Party’s aggregate Damages exceed Two Hundred Fifty Thousand Dollars ($250,000.00) and (z) the maximum liability of Entercom hereunder shall be Three Million Dollars ($3,000,000); provided, however, that the limits set forth in (y) and (z) shall not apply to any Damages arising from a breach by Entercom of the representations in the second sentence of Section 6.7(a), the first sentence of Section 6.8, or Section 6.13(c).

(b) From and after the Closing, Exchange Party shall defend, indemnify and hold harmless Entercom from and against any and all Damages incurred by Entercom arising out of or resulting from: (i) any breach or default by Exchange Party under this Agreement; (ii) the Exchange Party Retained Obligations or the business or operation of the Exchange Party Station before Closing or (iii) the Exchange Party Assumed Obligations or the business or operation of the Entercom Station after Closing; provided, however, that, except for the except for the items in (ii) and (iii) above (which shall not be subject to such limitations), (y) Exchange Party shall have no liability for breaches of representations and warranties to Entercom hereunder until, and only to the extent that, Entercom’s aggregate Damages exceed Two Hundred Fifty Thousand Dollars ($250,000.00) and (z) the maximum liability of Exchange Party hereunder shall be Three Million Dollars ($3,000,000.00); provided, however, that the limits set forth in (y) and (z) shall not apply to any Damages arising from a breach by Exchange Party of the representations in the second sentence of Section 7.7(a), the first sentence of Section 7.8, or Section 7.13(c).

15.3 Procedures. The indemnified party shall give prompt written notice to the indemnifying party of any demand, suit, claim or assertion of liability by third parties or other circumstances that could give rise to an indemnification obligation hereunder against the indemnifying party (a “Claim”), but a failure to give such notice or delaying such notice shall not affect the indemnified party’s right to indemnification and the indemnifying party’s obligation to indemnify as set forth in this Agreement, except to the extent the indemnifying party’s ability to remedy, contest, defend or settle with respect to such Claim is thereby prejudiced. The obligations and liabilities of the parties with respect to any Claim shall be subject to the following additional terms and conditions:

(a) The indemnifying party shall have the right to undertake, by counsel or other representatives of its own reasonable choosing, the defense or opposition to such Claim.

(b) In the event that the indemnifying party shall elect not to undertake such defense or opposition, or, within twenty (20) days after written notice (which shall include

sufficient description of background information explaining the basis for such Claim) of any such Claim from the indemnified party, the indemnifying party shall fail to undertake to defend or oppose, the indemnified party (upon further written notice to the indemnifying party) shall have the right to undertake the defense, opposition, compromise or settlement of such Claim, by counsel or other representatives of its own choosing, on behalf of and for the account and risk of the indemnifying party (subject to the right of the indemnifying party to assume defense of or opposition to such Claim at any time prior to settlement, compromise or final determination thereof).

(c) Anything herein to the contrary notwithstanding: (i) the indemnified party shall have the right, at its own cost and expense, to participate in the defense, opposition, compromise or settlement of the Claim; (ii) the indemnifying party shall not, without the indemnified party’s written consent (which shall not be unreasonably withheld, conditioned or delayed), settle or compromise any Claim or consent to entry of any judgment which does not include as an unconditional term thereof the giving by the claimant or the plaintiff to the indemnified party of a release from all liability in respect of such Claim; and (iii) in the event that the indemnifying party undertakes defense of or opposition to any Claim, the indemnified party, by counsel or other representative of its own choosing and at its sole cost and expense, shall have the right to consult with the indemnifying party and its counsel or other representatives concerning such Claim and the indemnifying party and the indemnified party and their respective counsel or other representatives shall cooperate in good faith with respect to such Claim.

(d) All claims not disputed shall be paid by the indemnifying party within thirty (30) days after receiving notice of the Claim. “Disputed Claims” shall mean claims for Damages by an indemnified party which the indemnifying party objects to in writing within thirty (30) days after receiving notice of the Claim. In the event there is a Disputed Claim with respect to any Damages, the indemnifying party shall be required to pay the indemnified party the amount of such Damages for which the indemnifying party has, pursuant to a final determination, been found liable within ten (10) days after there is a final determination with respect to such Disputed Claim. A final determination of a Disputed Claim shall be (i) a judgment of any court determining the validity of a Disputed Claim, if no appeal is pending from such judgment and if the time to appeal therefrom has elapsed; (ii) an award of any arbitration determining the validity of such disputed claim, if there is not pending any motion to set aside such award and if the time within which to move to set aside such award has elapsed; (iii) a written termination of the dispute with respect to such claim signed by the parties thereto or their attorneys; (iv) a written acknowledgment of the indemnifying party that it no longer disputes the validity of such claim; or (v) such other evidence of final determination of a disputed claim as shall be acceptable to the parties. No undertaking of defense or opposition to a Claim shall be construed as an acknowledgment by such party that it is liable to the party claiming indemnification with respect to the Claim at issue or other similar Claims.

15.4 Exclusive Remedy. The right to indemnification, defense, hold harmless, payment or reimbursement hereunder will be the exclusive remedy of any party after the Closing in connection with any breach by an other party of its representations, warranties, covenants or agreements, other than an exercise of the remedies provided under Section 16.2.

ARTICLE 16

TERMINATION

16.1 Termination. This Agreement may be terminated at any time prior to Closing as follows:

(a) by mutual written consent of Entercom and Exchange Party;

(b) by written notice of Entercom to Exchange Party if Exchange Party breaches in any material respect any of its representations or warranties or defaults in any material respect in the performance of any of its covenants or agreements herein contained and such breach or default is not cured within the Cure Period (defined below);

(c) by written notice of Exchange Party to Entercom if Entercom breaches in any material respect any of its representations or warranties or defaults in any material respect in the performance of any of its covenants or agreements herein contained and such breach or default is not cured within the Cure Period (defined below);

(d) by written notice of either party to the other if the FCC denies the FCC Application or designates any of those applications for evidentiary hearing;

(e) by written notice of Entercom to Exchange Party, or Exchange Party to Entercom, if the Closing shall not have been consummated on or before June 15, 2008;

(f) by written notice of Entercom to Exchange Party, or Exchange Party to Entercom, if the CBS Agreement or the Cumulus Agreement is terminated; or

(g) as provided in Section 10.9.

The term “Cure Period” as used herein means a period commencing the date a party receives from the other party written notice of breach or default hereunder and continuing until thirty (30) days thereafter; provided, however, that if the breach or default cannot reasonably be cured within such period but can be cured, and if diligent efforts to cure promptly commence, then the Cure Period shall continue as long as such diligent efforts to cure continue, but in no event shall the Cure Period continue past the thirtieth (30th) day after the date on which the FCC Consent or the FCC Consent becomes a Final Order (but in no event shall the Cure Period affect a party’s right to terminate this Agreement under Section 16.1(e)). Except as set forth below, the termination of this Agreement shall not relieve any party of any liability for breach or default under this Agreement prior to the date of termination. Notwithstanding anything contained herein to the contrary, Section 13.1 shall survive any termination of this Agreement.

16.2 Remedies. The parties recognize that if either party refuses to consummate the Closing pursuant to the provisions of this Agreement or either party otherwise breaches or defaults such that the Closing has not occurred (“Breaching Party”), monetary damages alone will not be adequate to compensate the non-breaching party (“Non-Breaching Party”) for its injury. Such Non-Breaching Party shall therefore be entitled to obtain specific performance of the terms of this Agreement in lieu of (without posting bond or other security), and not in

addition to, any other remedies, including but not limited to monetary damages, that may be available to it. If any action is brought by the Non-Breaching Party to enforce this Agreement, the Breaching Party shall waive the defense that there is an adequate remedy at law. In the event of a default by the Breaching Party which results in the filing of a lawsuit for damages, specific performance, or other remedy, the Non-Breaching Party shall be entitled to reimbursement by the Breaching Party of reasonable legal fees and expenses incurred by the Non-Breaching Party, provided that the Non-Breaching Party is successful in such lawsuit.

ARTICLE 17

MISCELLANEOUS PROVISIONS

17.1 Further Assurances. After the Closing, each party shall from time to time, at the request of and without further cost or expense to the other, execute and deliver such other instruments and take such other actions as may reasonably be requested in order to more effectively consummate the transactions contemplated hereby to exchange assets and assume obligations as contemplated by this Agreement.

17.2 Assignment. Neither party may assign this Agreement without the prior written consent of the other party hereto, except that either party may assign its rights under this Agreement to one or more wholly-owned subsidiaries of such party upon written notice to the other party and without consent from the other party. With respect to any permitted assignment, the parties shall take all such actions as are reasonably necessary to effectuate such assignment, including but not limited to cooperating in any appropriate filings with the FCC or other governmental authorities. All covenants, agreements, statements, representations, warranties and indemnities in this Agreement by and on behalf of any of the parties hereto shall bind and inure to the benefit of their respective successors and permitted assigns of the parties hereto.

17.3 Amendments. No amendment, waiver of compliance with any provision or condition 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 any waiver, amendment, change, extension or discharge is sought.

17.4 Headings. The headings set forth in this Agreement are for convenience only and will not control or affect the meaning or construction of the provisions of this Agreement.

17.5 Governing Law. 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.

17.6 Notices. Any notice, demand or request required or permitted to be given under the provisions of this Agreement shall be in writing, including by facsimile or email, and shall be deemed to have been received on the date of personal delivery, on the third day after deposit in the U.S. mail if mailed by registered or certified mail, postage prepaid and return receipt requested, on the day after delivery to a nationally recognized overnight courier service if sent by an overnight delivery service for next morning delivery or when delivered by facsimile

transmission or email, and shall be addressed as follows (or to such other address as any party may request by written notice):

if to Entercom:				Entercom Communications Corp.
				401 City Avenue, Suite 809
				Bala Cynwyd, PA 19004
				Attention: David J. Field
				Facsimile: (610) 660-5661
				Email: dfield@entercom.com

with a copy (which shall not
constitute notice) to:				Entercom Communications Corp.
				401 City Avenue, Suite 809
				Bala Cynwid, PA 19004
				Attention: John C. Donlevie, Esq.
				Facsimile: (610) 660-5641
				Email: jdonlevie@entercom.com

and				Latham & Watkins LLP
				555 11th Street, NW
				Washington, D.C. 20004
				Attention: David D. Burns, Esq.
				Facsimile: (202) 637-2201
				Email: david.burns@lw.com

if to Exchange Party:
				Bonneville International Corporation
				55 North Third West, 8th Floor
				Salt Lake City, UT 84180
				Attention: Bruce T. Reese
				Facsimile: (801) 575-7567
				Email: breese@bonneville.com

with a copy (which shall not
constitute notice) to:				Bonneville International Corporation
				55 North Third West, 8th Floor
				Salt Lake City, UT 84180
				Attention: David Redd
				Facsimile: (801) 575-7509
				Email: dredd@bonneville.com

17.7 Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed an original and all of which together will constitute one and the same instrument.

17.8 No Third Party Beneficiaries. Nothing herein expressed or implied is intended or shall be construed to confer upon or give to any Person or entity other than the parties hereto and

their successors or permitted assigns, any rights or remedies under or by reason of this Agreement.

17.9 Severability. The parties agree that if one or more provisions contained in this Agreement shall be deemed or held to be invalid, illegal or unenforceable in any respect under any applicable law or government regulation by any court or other governmental authority of competent jurisdiction, 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.

17.10 Entire Agreement. This Agreement and the documents referenced herein embody the entire agreement and understanding of the parties hereto and supersede any and all prior and contemporaneous agreements, arrangements and understandings relating to the matters provided for herein. This Agreement does not supersede any confidentiality agreement relating to the Entercom Stations or the Exchange Party Stations.

17.11 Direct Assignment of Entercom Station Assets. Exchange Party acknowledges that Entercom does not currently own certain of the Entercom Station Assets, but has agreed to acquire those Entercom Station Assets pursuant to the CBS Agreement and the Cumulus Agreement. Exchange Party agrees, if so requested by Entercom, to cooperate in the direct assignment from the CBS Parties and/or the Cumulus Parties to Exchange Party of such Entercom Station Assets; provided that such a direct assignment is reasonably practicable and would not materially delay the Closing, and would not, adversely affect the rights, protections and benefits it would otherwise receive if the transaction were consummated as contemplated by this Agreement.

17.12 Exchange Party’s Sale of KOIT (AM). Pursuant to the AIM Transaction, Exchange Party has agreed to sell and AIM has agreed to purchase the FCC licenses related to KOIT (AM), San Francisco, California, and certain assets relating directly to KOIT (AM), including the transmitter building, transmitter tower and the underlying real property (the “KOIT (AM) Facility”); provided, however, that Exchange Party will not be conveying to AIM and AIM will not be acquiring any of the intellectual property associated with the KOIT call sign. Entercom hereby acknowledges that Exchange Party will not be selling, conveying or transferring any of the KOIT (AM) assets listed on Schedule 1.4(p) to Entercom.

ARTICLE 18

DEFINITIONS

18.1 Defined Terms. Unless otherwise stated in this Agreement, the following terms when used herein shall have the meanings assigned to them below (such meanings to be equally applicable to both the singular and plural forms of the terms defined).

“Affiliate” shall mean, with respect to a specified Person, a Person that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with, the Person specified.

“Agreement” shall mean this Asset Exchange Agreement, including the exhibits and schedules hereto.

“AIM” shall have the meaning set forth in Section 1.4(p).

“Aim Transaction” shall have the meaning set forth in Section 1.4(p).

“Assignment” shall have the meaning set forth in Section 5.1(a).

“BHC” shall have the meaning set forth in the recitals to this Agreement.

“BHC Agreement” shall have the meaning set forth in the recitals to this Agreement.

“Breaching Party” shall have the meaning set forth in Section 16.2.

“Cash Consideration” shall have the meaning set forth in Section 1.5.

“CBS Agreement” shall have the meaning set forth in the recitals to this Agreement.

“CBS Closing Date” shall have the meaning set forth in Section 9.1.

“CBS Parties” shall have the meaning set forth in the recitals to this Agreement.

“Claim” shall have the meaning set forth in Section 15.3.

“Closing” shall have the meaning set forth in Section 4.1.

“Closing Date” shall have the meaning set forth in Section 4.1.

“Code” shall mean the Internal Revenue Code of 1986, as amended, and the regulations thereunder, or any subsequent legislative enactment thereof, as in effect from time to time.

“Communications Act” shall have the meaning set forth in Section 6.7(c).

“Contaminant” shall mean and include any pollutant, contaminant, hazardous material (as defined in any of the Environmental Laws), toxic substances (as defined in any of the Environmental Laws), asbestos or asbestos containing material, urea formaldehyde, polychlorinated biphenyls, regulated substances and wastes, radioactive materials, and petroleum or petroleum by-products, including crude oil or any fraction thereof, except that “Contaminant” shall not include small quantities of maintenance, cleaning and emergency generator fuel supplies customary for the operation of radio stations and maintained in compliance with all Environmental Laws in the ordinary course of business.

“CPA” shall have the meaning set forth in Section 3.1(f).

“CPI” shall have the meaning set forth in Section 10.7.

“Cumulus Agreement” shall have the meaning set forth in the recitals to this Agreement.

“Cumulus Closing Date” shall have the meaning set forth in Section 9.1.

“Cumulus Parties” shall have the meaning set forth in the recitals to this Agreement.

“Cure Period” shall have the meaning set forth in Section 16.1.

“Damages” shall have the meaning set forth in Section 15.2(a).

“Disapproved Matters” shall have the meaning set forth in Section 9.3(d).

“Disputed Claims” shall have the meaning set forth in Section 15.3(d).

“DOJ” shall have the meaning set forth in Section 6.3.

“Effective Time” shall have the meaning set forth in Section 3.1(a).

“Entercom” shall have the meaning set forth in the preamble of this Agreement.

“Entercom Accounts Receivable” shall have the meaning set forth in Section 10.10(c).

“Entercom Additional Contracts” shall have the meaning set forth in Section 10.11(b).

“Entercom Ancillary Agreement” shall have the meaning set forth in Section 6.2(a).

“Entercom Assumed Obligations” shall have the meaning set forth in Section 2.1.

“Entercom Available Employees” shall have the meaning set forth in Section 10.4(a).

“Entercom Cincinnati” shall have the meaning set forth in the preamble of this Agreement.

“Entercom Cincinnati Stations” shall have the meaning set forth in the recitals to this Agreement.

“Entercom Damaged Asset” shall have the meaning set forth in Section 10.9(a).

“Entercom Dedicated Employees” shall have the meaning set forth in Section 10.4(a).

“Entercom Employees” shall have the meaning set forth in Section 6.13(a).

“Entercom Excluded Assets” shall have the meaning set forth in Section 1.2.

“Entercom FCC Licenses” shall have the meaning set forth in Section 1.1(a).

“Entercom Intangible Property” shall have the meaning set forth in Section 1.1(d).

“Entercom Real Property” shall have the meaning set forth in Section 1.1(f).

“Entercom Reference Financial Statements” shall have the meaning set forth in Section 6.6.

“Entercom Reference Stations” shall have the meaning set forth in Section 6.6.

“Entercom Retained Obligations” shall have the meaning set forth in Section 2.4.

“Entercom Seattle” shall have the meaning set forth in the preamble of this Agreement.

“Entercom Seattle Stations” shall have the meaning set forth in the recitals to this Agreement.

“Entercom Shared Employees” shall have the meaning set forth in Section 10.4(a).

“Entercom Stations” shall have the meaning set forth in the recitals to this Agreement.

“Entercom Station Assets” shall have the meaning set forth in Section 1.1.

“Entercom Station Contracts” shall have the meaning set forth in Section 1.1(c).

“Entercom Station LMA” shall have the meaning set forth in Section 1.6(a).

“Entercom Tangible Personal Property” shall have the meaning set forth in Section 1.1(b).

“Entercom Transferred Employees” shall have the meaning set forth in Section 10.4(a).

“Environmental Laws” shall have the meaning set forth in Section 6.12(a) and Section 7.12.

“Estoppel Certificates” shall have the meaning set forth in Section 10.6.

“Exchange Party” shall have the meaning set forth in the preamble of this Agreement.

“Exchange Party Accounts Receivable” shall have the meaning set forth in Section 10.10(b).

“Exchange Party Additional Contracts” shall have the meaning set forth in Section 10.11(c).

“Exchange Party Ancillary Agreements” shall have the meaning set forth in Section 7.2(a).

“Exchange Party Assumed Obligations” shall have the meaning set forth in Section 2.3.

“Exchange Party Available Employees” shall have the meaning set forth in Section 10.4(b).

“Exchange Party Damaged Asset” shall have the meaning set forth in Section 10.9(b).

“Exchange Party Employees” shall have the meaning set forth in Section 7.13(a).

“Exchange Party Excluded Assets” shall have the meaning set forth in Section 1.4.

“Exchange Party FCC Licenses” shall have the meaning set forth in Section 1.3(a).

“Exchange Party Intangible Property” shall have the meaning set forth in Section 1.3(d).

“Exchange Party Real Property” shall have the meaning set forth in Section 1.3(f).

“Exchange Party Reference Financial Statements” shall have the meaning set forth in Section 7.6.

“Exchange Party Retained Obligations” shall have the meaning set forth in Section 2.2.

“Exchange Party Stations” shall have the meaning set forth in the recitals to this Agreement.

“Exchange Party Station Assets” shall have the meaning set forth in Section 1.3.

“Exchange Party Station Contracts” shall have the meaning set forth in Section 1.3(c).

“Exchange Party Station LMA” shall have the meaning set forth in Section 1.6(b).

“Exchange Party Tangible Personal Property” shall have the meaning set forth in Section 1.3(b).

“Exchange Party Transferred Employees” shall have the meaning set forth in Section 10.4(b).

“FCC” shall have the meaning set forth in the recitals to this Agreement.

“FCC Application” shall have the meaning set forth in Section 5.1(a).

“FCC Consent” shall have the meaning set forth in Section 5.1(a).

“FEMA” shall have the meaning set forth in Section 9.3(e).

“Final Order” means an action by the FCC (a) that has not been vacated, reversed, stayed, enjoined, set aside, annulled or suspended, (b) with respect to which no request for stay, motion or petition for rehearing, reconsideration or review, or application or request for review or notice of appeal or sua sponte review by the FCC is pending, and (c) as to which the time for filing any such request, motion, petition, application, appeal or notice, and for the entry of orders staying, reconsidering or reviewing on the FCC’s own motion has expired.

“FTC” shall have the meaning set forth in Section 6.3.

“GAAP” shall have the meaning set forth in Section 3.1(a).

“HSR Act” shall have the meaning set forth in Section 5.3.

“Knowledge,” “known to,” or similar terms shall refer to (i) with respect to Exchange Party, from the date of this Agreement until the date public announcement of the transactions contemplated hereby is made (the “Announcement Date”), the actual knowledge of Exchange Party’s Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Corporate Vice President of Engineering, General Counsel or Corporate Vice President of Human Resources, and after the Announcement Date shall include, in addition, the actual knowledge of the General Managers of each of the Exchange Party Stations, and (ii) with respect to Entercom, from the date of this Agreement until the Announcement Date, the actual knowledge of Entercom Communications Corporation’s Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Corporate Vice President of Engineering, General Counsel or Corporate Vice President of Human Resources, and after the Announcement Date shall include, in addition, the actual knowledge of the Entercom-employed General Managers of each of the Entercom Stations.

“KOIT (AM) Facility” shall have the meaning set forth in Section 17.12.

“Liens” shall have the meaning set forth in Section 1.1.

“LMAs” shall have the meaning set forth in Section 1.6(b).

“LMA Date” shall have the meaning set forth in Section 1.6(a).

“Non-Breaching Party” shall have the meaning set forth in Section 16.2.

“Payment Date” shall have the meaning set forth in Section 3.1(f).

“Permitted Liens” means, as to any property or asset, Liens for taxes, assessments and other governmental charges not yet due and payable; (i) in the case of real property, zoning laws and ordinances and similar laws that are not violated by any existing improvement or that do not prohibit the use of real property as currently used; (ii) any right reserved to any governmental authority to regulate the affected property (including restrictions stated in the permits); (iii) in the case of any leased asset, (1) the rights of any lessor under the applicable lease agreement or any Lien granted by any lessor and (2) the rights of the grantor of any easement or any Lien granted

by such grantor on such easement property; (iv) in the case of real property, easements, rights of way, restrictive covenants and other encumbrances, encroachments or other similar matters of record affecting title that do not materially adversely affect title to the property subject thereto or impair the continued use of the property as currently used; (v) inchoate materialmen’s, mechanics’, workmen’s, repairmen’s or other like Liens arising in the ordinary course of business, which Liens are released at or prior to Closing, are the subject of a proration under this Agreement or the LMAs, or relate to Entercom Retained Obligations or Exchange Party Retained Obligations, as the case may be, and will not encumber the Entercom Station Assets or the Exchange Party Station Assets after the Closing; and (vi) in the case of real property, any state of facts an accurate survey would show, provided same does not render title unmarketable, materially decrease the value of the property, constitute a lack of reasonable access, or prevent the real property from being utilized in substantially the same manner currently used.

“Person” shall mean an individual, a partnership, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or a governmental entity (or any department, agency or political subdivision thereof).

“Schedule Amendment Deadline” shall have the meaning set forth in Section 10.11(b).

“Seattle Preliminary Title Report” shall have the meaning set forth in Section 9.3(d).

“Seattle Real Property” shall have the meaning set forth in Section 6.11(b).

“Seattle Survey” shall have the meaning set forth in Section 9.3(d).

“Turnover Date” shall have the meaning set forth in Section 10.10(a).

“WFTK Gross Revenues” shall have the meaning set forth in Section 6.6.

18.2 Terms Generally. The term “or” is disjunctive; the term “and” is conjunctive. The term “shall” is mandatory; the term “may” is permissive. Masculine terms apply to females; feminine terms apply to males. The term “include,” “includes” or “including” is by way of example and not limitation.

[SIGNATURE PAGE FOLLOWS]

SIGNATURE PAGE TO ASSET EXCHANGE AGREEMENT

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

		ENTERCOM CINCINNATI, LLC


		By:
				Name:
				Title:


		ENTERCOM CINCINNATI LICENSE, LLC


		By:
				Name:
				Title:


		ENTERCOM SEATTLE, LLC


		By:
				Name:
				Title:


		ENTERCOM SEATTLE LICENSE, LLC


		By:
				Name:
				Title:


		BONNEVILLE INTERNATIONAL CORPORATION


		By:
				Name:
				Title:

Schedules:

Schedule		Description

1.1(a)		Entercom FCC Licenses

1.1(b)		Entercom Station Assets

1.1(c)		Entercom Station Contracts

1.1(d)		Entercom Intangible Property

1.1(f)		Entercom Real Property

1.2(q)		CBS/Cumulus Excluded Assets

1.2(r)		Entercom Excluded Assets

1.3(a)		Exchange Party FCC Licenses

1.3(b)		Exchange Party Station Assets

1.3(c)		Exchange Party Station Contracts

1.3(d)		Exchange Party Intangible Property

1.3(f)		Exchange Party Real Property

1.4(p)		KOIT (AM) Assets Excluded from Exchange

1.4(q)		Exchange Party Excluded Assets

6.4		Noncontravention (Entercom)

6.5		Absence of Litigation (Entercom)

6.8		Tangible Personal Property (Entercom)

6.11(a)		Owned/Leased Real Property (Entercom)

6.11(b)		Seattle Real Property Permitted Liens (Entercom)

6.11(c)		Seattle Real Property Used in Operation of the Entercom Stations (Entercom)

6.12		Environmental (Entercom)

6.13		Employees (Entercom)

6.13(b)		Transferred Employees (Entercom)

6.14		Compliance with Laws (Entercom)

6.16		Finders (Entercom)

6.17		Title to Station Assets (Entercom)

7.4		Noncontravention (Exchange Party)

7.5		Absence of Litigation (Exchange Party)

7.8		Tangible Personal Property (Exchange Party)

7.11		Real Property (Exchange Party)

7.12		Environmental (Exchange Party)

7.13(a)		Employees (Exchange Party)

7.13(b)		Collective Bargaining Agreement (Exchange Party)

7.14		Compliance with Laws (Exchange Party)

7.16		Finders (Exchange Party)

7.17		Title to Station Assets (Exchange Party)

Exhibits:

A	—	Entercom Station LMA
B	—	Exchange Party Station LMA

EX-31.01 3 a07-10631_1ex31d01.htm EX-31.01

EXHIBIT 31.01

CERTIFICATION OF PRESIDENT AND CHIEF EXECUTIVE OFFICER

I, David J. Field, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Entercom Communications Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 8, 2007

By:	/s/ David J. Field
Name:	David J. Field
Title:	President and Chief Executive Officer
	(principal executive officer)

EX-31.02 4 a07-10631_1ex31d02.htm EX-31.02

EXHIBIT 31.02

CERTIFICATION OF EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER

I, Stephen F. Fisher, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Entercom Communications Corp.;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 8, 2007

By:	/s/ Stephen F. Fisher
Name:	Stephen F. Fisher
Title:	Executive Vice President and Chief Financial Officer
	(principal financial officer)

EX-32.01 5 a07-10631_1ex32d01.htm EX-32.01

EXHIBIT 32.01

CERTIFICATION OF PRESIDENT AND CHIEF EXECUTIVE OFFICER

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Entercom Communications Corp. (the “Company”) hereby certifies, to such officer’s knowledge, that:

(i) the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended March 31, 2007 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 8, 2007

By:	/s/ David J. Field
Name:	David J. Field
Title:	President and Chief Executive Officer
	(principal executive officer)

A signed original of this written statement required by Section 906 has been provided to Entercom Communications Corp. and will be retained by Entercom Communications Corp. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2 6 a07-10631_1ex32d2.htm EX-32.2

EXHIBIT 32.02

CERTIFICATION OF EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 8, 2007

By:	/s/ Stephen F. Fisher
Name:	Stephen F. Fisher
Title:	Executive Vice President and Chief Financial Officer
	(principal financial officer)

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