ENTERCOM COMMUNICATIONS CORP (Form: 10-Q, Received: 08/05/2016 11:38:11)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

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 June 30, 2016

¨	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 E. 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 ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ 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, $0.01 par value – 33,405,006 Shares Outstanding as of July 20, 2016

(Class A Shares Outstanding include 2,123,451 unvested and vested but deferred restricted stock units)

Class B common stock, $0.01 par value – 7,197,532 Shares Outstanding as of July 20, 2016.

ENTERCOM COMMUNICATIONS CORP.

INDEX


Part I Financial Information

Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	35

Part II Other Information

Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	38

Signatures		39

Exhibit Index		40

Private Securities Litigation Reform Act Safe Harbor Statement

In addition to historical information, this report contains 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,” “could,” “would,” “should,” “seeks,” “estimates,” “predicts” 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 26, 2016 and as may be supplemented by the risks described under Part II, Item 1A, of our quarterly reports on Form 10-Q and in our Current Reports on Form 8-K.

PART I

FINANCIAL INFORMATION

ITEM 1.

Financial Statements

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)


	JUNE 30, 2016			DECEMBER 31, 2015
ASSETS:
Cash	$	11,071		$	9,169
Accounts receivable, net of allowance for doubtful accounts		91,312			87,157
Prepaid expenses, deposits and other		8,408			6,220
Prepaid and refundable federal and state income taxes		106			55
Deferred tax assets		3,464			3,464

Total current assets		114,361			106,065
Net property and equipment		55,875			57,993
Radio broadcasting licenses		807,416			807,381
Goodwill		32,629			32,629
Assets held for sale		—			6,106
Deferred charges and other assets, net of accumulated amortization		4,540			5,471

TOTAL ASSETS	$	1,014,821		$	1,015,645

LIABILITIES:
Accounts payable	$	105		$	73
Accrued expenses		15,827			16,772
Other current liabilities		19,945			19,924
Long-term debt, current portion		29,150			31,832

Total current liabilities		65,027			68,601

Long-term debt, net of current portion		431,119			448,724
Deferred tax liabilities		89,883			81,643
Other long-term liabilities		27,495			27,608

Total long-term liabilities		548,497			557,975

Total liabilities		613,524			626,576

CONTINGENCIES AND COMMITMENTS
PERPETUAL CUMULATIVE CONVERTIBLE PREFERRED STOCK		27,619			27,619

SHAREHOLDERS’ EQUITY:
Class A, B and C common stock		406			397
Additional paid-in capital		608,727			611,754
Accumulated deficit		(235,455	)		(250,701	)

Total shareholders’ equity		373,678			361,450

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,014,821		$	1,015,645

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

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

(unaudited)


	THREE MONTHS ENDED						SIX MONTHS ENDED
	JUNE 30,
	2016			2015			2016			2015
NET REVENUES	$	120,478		$	100,592		$	216,581		$	179,012

OPERATING EXPENSE:
Station operating expenses, including non-cash compensation expense		82,639			70,000			154,354			129,367
Depreciation and amortization expense		2,517			1,905			4,964			3,860
Corporate general and administrative expenses, including non-cash compensation expense		8,493			6,451			16,091			12,730
Impairment loss		—			—			62			—
Merger and acquisition costs and restructuring charges		—			2,031			—			3,754
Net (gain) loss on sale or disposal of assets		(755	)		(410	)		(1,219	)		(567	)

Total operating expense		92,894			79,977			174,252			149,144

OPERATING INCOME (LOSS)		27,584			20,615			42,329			29,868

OTHER (INCOME) EXPENSE:
Net interest expense		9,147			9,313			18,539			18,592

TOTAL OTHER EXPENSE		9,147			9,313			18,539			18,592

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)		18,437			11,302			23,790			11,276
INCOME TAXES (BENEFIT)		7,603			4,555			8,544			4,622

NET INCOME (LOSS) AVAILABLE TO THE COMPANY		10,834			6,747			15,246			6,654
Preferred stock dividend		(412	)		—			(825	)		—

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	10,422		$	6,747		$	14,421		$	6,654

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS PER SHARE - BASIC	$	0.27		$	0.18		$	0.37		$	0.17

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS PER SHARE - DILUTED	$	0.26		$	0.17		$	0.37		$	0.17

DIVIDENDS DECLARED AND PAID PER COMMON SHARE	$	0.075		$	—		$	0.075		$	—

WEIGHTED AVERAGE SHARES:
Basic		38,468,822			38,074,240			38,462,998			38,071,049

Diluted		41,130,418			38,928,610			39,273,532			39,026,880

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

SIX MONTHS ENDED JUNE 30, 2016 AND YEAR ENDED DECEMBER 31, 2015

(amounts in thousands, except share data)

(unaudited)


														Retained
	Common Stock										Additional			Earnings
	Class A						Class B				Paid-in			(Accumulated
	Shares			Amount			Shares		Amount		Capital			Deficit)			Total
Balance, December 31, 2014		31,862,294		$	319			7,197,532	$	72	$	608,515		$	(279,885	)	$	329,021
Net income (loss) available to the Company		—			—			—		—		—			29,184			29,184
Compensation expense related to granting of stock awards		738,195			7			—		—		5,517			—			5,524
Exercise of stock options		11,750			—			—		—		35			—			35
Purchase of vested employee restricted stock units		(131,688	)		(1	)		—		—		(1,561	)		—			(1,562	)
Preferred stock dividend		—			—			—		—		(752	)		—			(752	)

Balance, December 31, 2015		32,480,551			325			7,197,532		72		611,754			(250,701	)		361,450
Net income (loss) available to the Company		—			—			—		—		—			15,246			15,246
Compensation expense related to granting of stock awards		1,107,635			11			—		—		3,008			—			3,019
Exercise of stock options		22,500			—			—		—		30			—			30
Purchase of vested employee restricted stock units		(227,171	)		(2	)		—		—		(2,191	)		—			(2,193	)
Payment of dividends on common stock		—			—			—		—		(2,886	)		—			(2,886	)
Dividend equivalents, net of forfeitures		—			—			—		—		(163	)		—			(163	)
Payment of dividends on preferred stock		—			—			—		—		(825	)		—			(825	)

Balance, June 30, 2016		33,383,515		$	334			7,197,532	$	72	$	608,727		$	(235,455	)	$	373,678

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

(unaudited)


	SIX MONTHS ENDED
	JUNE 30,
	2016			2015
OPERATING ACTIVITIES:
Net income (loss) available to the Company	$	15,246		$	6,654

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		4,964			3,860
Amortization of deferred financing costs (including original issue discount)		1,503			1,588
Net deferred taxes (benefit) and other		8,544			4,622
Provision for bad debts		743			564
Net (gain) loss on sale or disposal of assets		(1,219	)		(567	)
Non-cash stock-based compensation expense		3,019			2,542
Deferred rent		244			355
Unearned revenue - long-term		—			(10	)
Deferred compensation		730			558
Impairment loss		62			—
Accretion expense, net of asset retirement obligation adjustments		12			7

Changes in assets and liabilities:
Accounts receivable		(4,898	)		(4,082	)
Prepaid expenses and deposits		(2,227	)		(993	)
Accounts payable and accrued liabilities		(442	)		5,252
Accrued interest expense		(835	)		(44	)
Accrued liabilities - long-term		(1,188	)		(1,050	)
Prepaid expenses - long-term		340			656

Net cash provided by (used in) operating activities		24,598			19,912

INVESTING ACTIVITIES:
Additions to property and equipment		(2,038	)		(4,744	)
Proceeds from sale of property, equipment, intangibles and other assets		7,114			406
Deferred charges and other assets		(151	)		(462	)

Net cash provided by (used in) investing activities		4,925			(4,800	)

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

(unaudited)


	SIX MONTHS ENDED
	JUNE 30,
	2016			2015
FINANCING ACTIVITIES:
Borrowing under the revolving senior debt		14,500			—
Proceeds from the capital lease obligations and other		102			—
Payments of long-term debt		(36,258	)		(1,500	)
Proceeds from the exercise of stock options		30			31
Purchase of vested employee restricted stock units		(2,193	)		(1,520	)
Payment of dividends on common stock		(2,886	)		—
Payment of dividend equivalents on vested restricted stock units		(91	)		—
Payment of dividends on preferred stock		(825	)		—

Net cash provided by (used in) financing activities		(27,621	)		(2,989	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		1,902			12,123
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR		9,169			31,540

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	11,071		$	43,663

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	18,307		$	17,456

Income taxes	$	208		$	81

Dividends on common stock	$	2,886		$	—

Dividends on preferred stock	$	825		$	—

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SIX MONTHS ENDED JUNE 30, 2016 AND 2015

1.	BASIS OF PRESENTATION AND SIGNIFICANT POLICIES

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 (“U.S. GAAP”) 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 U.S. GAAP for annual 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 and 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 related notes included in the Company’s audited financial statements as of and for the year ended December 31, 2015 and filed with the SEC on February 26, 2016, as part of the Company’s Annual Report on Form 10-K. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations.

There have been no material changes from Note 2, Significant Accounting Policies, as described in the notes to the Company’s financial statements contained in its Form 10-K for the year ended December 31, 2015 that was filed with the SEC on February 26, 2016.

Recent Accounting Pronouncements

All new accounting pronouncements that are in effect that may impact the Company’s financial statements have been implemented. The Company does not believe that there are any other new accounting pronouncements that have been issued, other than a few of the ones listed below or those included in the notes to the Company’s financial statements contained in its Form 10-K for the year ended December 31, 2015 that was filed with the SEC on February 26, 2016, that might have a material impact on the Company’s financial position, results of operations or cash flows.

Stock-Based Compensation Simplification

In March 2016, the accounting guidance for stock-based compensation was modified to reflect in the income statement the income tax effects of awards when stock-based awards vest. The guidance on employers’ accounting for an employee’s use of shares to satisfy the employer’s statutory income tax withholding obligation and for forfeitures is also changing. This guidance is effective for the Company as of January 1, 2017. The Company believes that: (1) the Company may recognize future income tax benefits that were previously not allowed to be recognized; and (2) the Company may increase the shares withheld upon the vesting of RSUs in order to satisfy employees’ tax obligations. The impact of this guidance should not be material to the Company’s financial position, results of operations or cash flows.

Leasing Transactions

In February 2016, the accounting guidance was modified to require that all leases with a term of more than one year, covering leased assets such as real estate, broadcasting towers and equipment, be reflected on the balance sheet as assets and liabilities for the rights and obligations created by these leases. While the Company is currently reviewing the effects of this guidance, the Company believes that this would result in: (1) an increase in the assets and liabilities reflected on the Company’s consolidated balance sheets; and (2) an increase in the Company’s interest expense and depreciation and amortization expense and a decrease to the Company’s station operating expense reflected on its consolidated statements of operations. This guidance is effective for the Company as of January 1, 2019.

Revenue Recognition

In May 2014 the accounting guidance for revenue recognition was modified. Under the guidance, an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The guidance will be applied using one of two retrospective methods. The guidance is effective for the Company as of January 1, 2018. The Company has not determined the potential effects of this guidance on its financial statements.

The following accounting pronouncements were effective for the Company as of January 1, 2016.

Business Combinations

In September 2015, the accounting guidance for business combinations was modified to reflect measurement period adjustments to be recorded prospectively rather than retroactively to the assets and liabilities initially recorded under purchase price accounting. This guidance was effective for the Company as of January 1, 2016. This guidance did not have an impact on the Company’s financial position and results of operations, but could have an impact in a future period when an adjustment is recorded for a previously reported business combination. There should be no material impact to the Company’s cash flows.

Cloud Computing Costs

In April 2015, the accounting guidance was revised to identify when a cloud computing service includes a software license that is to be capitalized and treated consistently with the acquisition of other software licenses. This guidance was effective for the Company as of January 1, 2016. The adoption of this accounting guidance did not have any material effect on the Company’s results of operations, cash flows or financial position.

Debt Issuance Costs

In April 2015, the accounting guidance was amended to modify the presentation of debt issuance costs on the balance sheet by requiring that all costs, including incremental third-party costs, be reflected as an offset to the associated debt liability rather than as a deferred charge. This guidance was effective for the Company as of January 1, 2016. The impact of this guidance was to reclassify debt issuance costs (other than those for line-of-credit arrangements) from other assets to the respective long-term debt liability for balance sheet presentation purposes only and had no impact on the Company’s results of operations, cash flows or financial position. In addition, certain reclassifications were recorded to the prior year’s balance sheet to conform to the presentation in the current year, which did not have a material impact on the Company’s previously reported financial statements.

Consolidation

In February 2015, the accounting guidance for consolidation was amended which revises the analysis of and reduces the need to consolidate certain entities. This guidance was effective for the Company as of January 1, 2016. This accounting guidance did not have any material effect on the Company’s results of operations, cash flows or financial position.

Extraordinary Items

In January 2015, the accounting guidance was updated to eliminate the concept of an extraordinary item and the requirement to consider whether an underlying event or transaction is extraordinary. If an item was considered extraordinary, it was presented in the income statement net of tax, after income from continuing operations. Eliminating the concept of extraordinary removes the uncertainty for the preparer as to whether the item had been treated properly. This guidance was effective for the Company as of January 1, 2016. The Company will apply this guidance prospectively to all applicable transactions. When applied, this guidance should have no impact to the Company’s cash flows or financial position as this only impacts the Company’s presentation of the Company’s results of operations.

Derivatives And Hedging

In November 2014, the accounting guidance was updated for determining whether the host contract in a hybrid financial instrument issued in the form of a share is more akin to debt or to equity. This update does not change the current criteria for determining when separation of certain embedded derivative features in a hybrid financial instrument is required, but clarifies how current accounting guidance should be interpreted in the evaluation of the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share, reducing existing diversity in practice. This guidance was effective for the Company as of January 1, 2016. The adoption of this accounting guidance did not have any material effect on the Company’s results of operations, cash flows or financial position.

Stock-Based Performance Awards

In June 2014, the accounting guidance was updated for stock-based awards when the terms of an award provide that a performance target that affects vesting could be achieved after the requisite service period. The current accounting standard for stock-based compensation as it applies to awards with performance conditions should be applied. This guidance was effective for the Company as of January 1, 2016. The adoption of this accounting guidance did not have any material effect on the Company’s results of operations, cash flows or financial position.

Reclassifications

Certain reclassifications have been made to the prior year’s financial statements to conform to the presentation in the current year (see accounting pronouncement on debt issuance costs).

2.	INTANGIBLE ASSETS AND GOODWILL

Goodwill and certain intangible assets are not amortized for book purposes. They may be, however, amortized for tax purposes. The Company accounts for its acquired broadcasting licenses as indefinite-lived intangible assets and, similar to goodwill, these assets are reviewed at least annually for impairment. At the time of each review, if the fair value is less than the carrying value of goodwill and certain intangibles (such as broadcasting licenses), then a charge is recorded to the results of operations.

There was no material change in the carrying value of broadcasting licenses or goodwill since the year ended December 31, 2015.

Broadcasting Licenses Impairment Test

The Company performs its annual broadcasting license impairment test during the second quarter of each year by evaluating its broadcasting licenses for impairment at the market level using the direct method.

During the second quarter of the current year and each of the past several years, the Company completed its annual impairment test for broadcasting licenses and determined that the fair value of its broadcasting licenses was greater than the amount reflected in the balance sheet for each of the Company’s markets and, accordingly, no impairment was recorded. The annual impairment test included the four new markets added during the second half of 2015.

Each market’s broadcasting licenses are combined into a single unit of accounting for purposes of testing impairment, as the broadcasting licenses in each market are operated as a single asset. The Company determines the fair value of the broadcasting licenses in each of its markets by relying on a discounted cash flow approach (a 10-year income model) assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. These assumptions include, but are not limited to: (1) the discount rate; (2) the market share and profit margin of an average station within a market, based upon market size and station type; (3) the forecast growth rate of each radio market; (4) the estimated capital start-up costs and losses incurred during the early years; (5) the likely media competition within the market area; (6) the tax rate; and (7) future terminal values.

The methodology used by the Company in determining its key estimates and assumptions was applied consistently to each market. Of the seven variables identified above, the Company believes that the assumptions in items (1) through (3) above are the most important and sensitive in the determination of fair value.

The following table reflects the estimates and assumptions used in the second quarter of each year (no interim tests were performed in these years):


	Estimates And Assumptions
	Second Quarter 2016	Second Quarter 2015
Discount rate	9.5%	9.7%
Operating profit margin ranges expected for average stations in the markets where the Company operates	14% to 40%	25% to 40%
Long-term revenue growth rate range of the Company’s markets	1.0% to 2.0%	1.5% to 2.0%

The Company has made reasonable estimates and assumptions to calculate the fair value of its broadcasting licenses. These estimates and assumptions could be materially different from actual results.

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 reduce the fair value of the Company’s broadcasting licenses below the amount reflected in the balance sheet, the Company may be required to conduct an interim test and possibly recognize impairment charges, which may be material, in future periods.

Goodwill Impairment Test

The Company performs its annual goodwill impairment test during the second quarter of each year by evaluating its goodwill for each reporting unit.

The Company has determined that a radio market is a reporting unit and the Company assesses goodwill in each of the Company’s markets. If the fair value of any reporting unit is less than the amount reflected on 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. The Company uses quantitative rather than qualitative factors to determine whether it is necessary to perform the two-step goodwill impairment test. In the second step, the Company compares the amount reflected on the balance sheet to 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.

To determine the fair value, the Company uses a market approach and, when appropriate, an income approach in computing the fair value of each reporting unit. The market approach calculates the fair value of each market’s radio stations by analyzing recent sales and offering prices of similar properties expressed as a multiple of cash flow. The income approach utilizes a discounted cash flow method by projecting the subject property’s income over a specified time and capitalizing at an appropriate market rate to arrive at an indication of the most probable selling price.

The following table reflects the estimates and assumptions used in the second quarter of each year (no interim tests were performed in these years):


	Estimates And Assumptions
	Second Quarter 2016	Second Quarter 2015
Discount rate	9.5%	9.7%
Long-term revenue growth rate range of the Company’s markets	1.0% to 2.0%	1.5% to 2.0%
Market multiple used in the market valuation approach	7.5x to 8.0x	7.5x to 8.0x

During the second quarter of the current year and in each of the past several years, the results of step one indicated that it was not necessary to perform the second step analysis in any of the reporting units that contained goodwill.

The Company also performed a reasonableness test on the fair value results for goodwill on a combined basis by comparing the carrying value of the Company’s assets to the Company’s enterprise value based upon its stock price. The Company determined that the results were reasonable.

In step one of the Company’s goodwill analysis, the Company considered the results of the market approach and, when appropriate, the income approach in computing the fair value of the Company’s reporting units. In the market approach, the Company applied an estimated market multiple to each reporting unit’s operating profit to calculate the fair value. In the income approach, the Company utilized the discounted cash flow methodology to calculate the fair value of the reporting unit. Management believes that these approaches are commonly used and appropriate methodologies for valuing broadcast radio stations. Factors contributing to the determination of the reporting unit’s operating performance were historical performance and/or management’s estimates of future performance.

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 reduce the fair value of the Company’s goodwill below the amount reflected in the balance sheet, the Company may be required to conduct an interim test and possibly recognize impairment charges, which could be material, in future periods.

3.	OTHER CURRENT LIABILITIES

Other current liabilities consist of the following as of the periods indicated:


	Other Current Liabilities
	June 30, 2016		December 31, 2015
	(amounts in thousands)
Accrued compensation	$	8,249	$	8,865
Accounts receivable credits		4,388		3,575
Advertiser obligations		1,434		1,198
Accrued interest payable		2,711		3,547
Other		3,163		2,739

Total other current liabilities	$	19,945	$	19,924

4.	LONG-TERM DEBT

(A) Senior Debt

The Credit Facility

As of June 30, 2016, the amount outstanding under the term loan component (the “Term B Loan”) of the Company’s senior secured credit facility (the “Credit Facility”) was $230.0 million and the amount outstanding under the revolving credit facility (the “Revolver”) of the Credit Facility was $17.0 million. The amount available under the Revolver, which includes the impact of outstanding letters of credit, was $22.3 million as of June 30, 2016.

On November 23, 2011, the Company entered into a credit agreement with a syndicate of lenders for a $425 million Credit Facility that was initially comprised of: (a) a $50 million Revolver (reduced to $40 million in December 2015) that matures on November 23, 2016; and (b) a $375 million Term B Loan that matures on November 23, 2018.

Long-term debt, which excludes deferred financing expense on the Revolver, was comprised of the following:


	Long-Term Debt
	June 30,			December31,
	2016			2015
	(amounts in thousands)
Credit Facility
Revolver, due November 23, 2016	$	17,000		$	26,000
Term B Loan, due November 23, 2018		230,000			242,750

		247,000			268,750

Senior Notes
10.5% senior unsecured notes, due December 1, 2019		220,000			220,000
Unamortized original issue discount		(1,547	)		(1,731	)

		218,453			218,269

Other Debt
Capital lease and other		94			—

Total debt before deferred financing costs		465,547			487,019
Current amount of long-term debt		(29,150	)		(31,832	)
Deferred financing costs (excluding Revolver)		(5,278	)		(6,463	)

Total long-term debt, net of current debt	$	431,119		$	448,724

Outstanding standby letter of credit	$	670		$	670

The Term B Loan requires mandatory prepayments equal to a percentage of Excess Cash Flow, which is defined within the agreement and is subject to incremental step-downs depending on the Consolidated Leverage Ratio. The payment, which is currently estimated at 25% of Excess Cash Flow, is due in the first quarter of each year for the prior year and is included under the current portion of long-term debt, net of any prepayments made through June 30, 2016. The Company expects to fund the payment using cash from operating activities.

As of June 30, 2016, the Company is in compliance with all financial covenants and all other terms of the Credit Facility in all material respects. The Company’s ability to maintain compliance with its covenants under the Credit Facility is highly dependent on its results of operations. Management believes that over the next 12 months the Company can continue to maintain compliance. The Company’s operating cash flow is positive, and management believes that it is adequate to fund the Company’s operating needs. Management believes that the Company can meet its liquidity requirements over the next 12 months, including its debt repayments.

Failure to comply with the Company’s financial covenants or other terms of its Credit Facility and any subsequent failure to negotiate and obtain any required relief from its lenders could result in a default under the Company’s Credit Facility. Any event of default could have a material adverse effect on the Company’s business and financial condition. In addition, a default under either the Company’s Credit Facility or the indenture governing the Company’s 10.5% senior unsecured notes (the “Senior Notes”) could cause a cross default in the other and result in the acceleration of the maturity of all outstanding debt. The acceleration of the Company’s debt could have a material adverse effect on its business. The Company may seek from time to time to amend its Credit Facility or obtain other funding or additional funding, which may result in higher interest rates on its debt.

As of June 30, 2016, the Company’s Consolidated Leverage Ratio was 3.9 times versus a covenant limit of 4.5 times and the Consolidated Interest Coverage Ratio was 3.4 times versus a covenant minimum of 2.0 times.

(B) Senior Unsecured Debt

The Senior Notes

The Senior Notes may be redeemed at any time at a redemption price of 105.25% of the principal amount plus accrued interest. The redemption price decreases December 1, 2016 and December 1, 2017 to 102.625% and 100.0%, respectively.

On November 23, 2011, the Company issued $220.0 million of 10.5% unsecured Senior Notes which mature on December 1, 2019. The Company received net proceeds of $212.7 million, which included a discount of $2.9 million, and incurred deferred financing costs of $6.1 million. These amounts are amortized over the term under the effective interest rate method. Interest on the Senior Notes is payable semi-annually in arrears on June 1 and December 1 of each year.

(C) Net Interest Expense

The components of net interest expense are as follows:


	Net Interest Expense
	Six Months Ended June 30,
	2016			2015
	(amounts in thousands)
Interest expense	$	17,057		$	17,004
Amortization of deferred financing costs		1,319			1,423
Amortization of original issue discount of senior notes		184			165
Interest income and other investment income		(21	)		—

Total net interest expense	$	18,539		$	18,592


	Net Interest Expense
	Three Months Ended June 30,
	2016			2015
	(amounts in thousands)
Interest expense	$	8,435		$	8,513
Amortization of deferred financing costs		631			716
Amortization of original issue discount of senior notes		93			84
Interest income and other investment income		(12	)		—

Total net interest expense	$	9,147		$	9,313

5.	NET INCOME (LOSS) PER COMMON SHARE

The following tables present the computations of basic and diluted net income (loss) per share:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
	(amounts in thousands except per share data)
Basic Income (Loss) Per Share
Numerator
Net income (loss) available to the Company	$	10,834	$	6,747	$	15,246	$	6,654
Preferred stock dividends		412		—		825		—

Net income (loss) available to common shareholders	$	10,422	$	6,747	$	14,421	$	6,654

Denominator
Basic weighted average shares outstanding		38,469		38,074		38,463		38,071

Basic net income (loss) per share available to common shareholders	$	0.27	$	0.18	$	0.37	$	0.17

Diluted Income (Loss) Per Share
Numerator
Net income (loss) available to the Company	$	10,834	$	6,747	$	15,246	$	6,654
Preferred stock dividends		—		—		825		—

Net income (loss) available to common shareholders	$	10,834	$	6,747	$	14,421	$	6,654

Denominator
Basic weighted average shares outstanding		38,469		38,074		38,463		38,071
Effect of RSUs and options under the treasury stock method		738		855		811		956
Preferred stock under the as if converted method		1,923		—		—		—

Diluted weighted average shares outstanding		41,130		38,929		39,274		39,027

Diluted net income (loss) per share available to common shareholders	$	0.26	$	0.17	$	0.37	$	0.17

Disclosure Of Anti-Dilutive Shares

The following table provides those shares excluded as they were anti-dilutive:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
Impact Of Equity Issuances	2016		2015		2016		2015
	(amounts in thousands, except per share data)
Shares excluded as anti-dilutive under the treasury stock method:
Options		—		—		13		—

Price range of options: from	$	—	$	—	$	11.36	$	—

Price range of options: to	$	—	$	—	$	11.78	$	—

RSUs with service conditions		—		7		—		6

RSUs excluded with service and market conditions as market conditions not met		628		165		628		165

RSUs excluded with service and performance conditions as performance conditions not met		21		8		21		8

Perpetual cumulative convertible preferred stock treated as anti-dilutive under the as if method		—		—		1,923		—

6.	SHARE-BASED COMPENSATION

Under the Entercom Equity Compensation Plan (the “Plan”), the Company is authorized to issue share-based compensation awards to key employees, directors and consultants.

Restricted Stock Units (“RSUs”) Activity

The following is a summary of the changes in RSUs under the Plan during the current period:


			Number					Weighted		Aggregate
			Of			Weighted		Average		Intrinsic
			Restricted			Average		Remaining		Value As Of
			Stock			Purchase		Contractual		June 30,
	Period Ended		Units			Price		Term (Years)		2016
RSUs outstanding as of:		December 31, 2015		1,590,417
RSUs awarded				1,116,585
RSUs released				(595,717	)
RSUs forfeited				(8,950	)

RSUs outstanding as of:		June 30, 2016		2,102,335		$	—		1.9	$	28,528,686

RSUs vested and expected to vest as of:		June 30, 2016		1,905,785		$	—		1.9	$	25,198,200

RSUs exercisable (vested and deferred) as of:		June 30, 2016		48,880		$	—		—	$	663,302

Weighted average remaining recognition period in years				2.7

Unamortized compensation expense, net of estimated forfeitures			$	14,079,435

RSUs With Service And Market Conditions

The Company issued RSUs with service and market conditions that are included in the table above. These shares vest if: (1) the Company’s stock achieves certain shareholder performance targets over a defined measurement period; and (2) the employee fulfills a minimum service period. The compensation expense is recognized even if the market conditions are not satisfied and are only reversed in the event the service period is not met, as all of the conditions need to be satisfied. These RSUs are amortized over the longest of the explicit, implicit or derived service periods, which range from one to three years.

The following table presents the changes in outstanding RSUs with market conditions:


	Six Months			Year
	Ended			Ended
	June 30,			December 31,
	2016			2015
	(amounts in thousands, except per share data)
Reconciliation Of RSUs With Market Conditions
Beginning of period balance		390			290
Number of RSUs granted		470			165
Number of RSUs forfeited		—			—
Number of RSUs vested		(225	)		(65	)

End of period balance		635			390

Weighted average fair value of RSUs granted with market conditions	$	7.34		$	8.39

The fair value of RSUs with service conditions is estimated using the Company’s closing stock price on the date of the grant. To determine the fair value of RSUs with service and market conditions, the Company used the Monte Carlo simulation lattice model. The Company’s determination of the fair value was based on the number of shares granted, the Company’s stock price on the date of grant and certain assumptions regarding a number of highly complex and subjective variables. If other reasonable assumptions were used, the results could differ.

The specific assumptions used for these valuations are as follows:


	Six Months	Year
	Ended	Ended
	June 30,	December 31,
	2016	2015
Expected Volatility Term Structure ⁽¹⁾	35% to 45%	34% to 39%
Risk-Free Interest Rate ⁽²⁾	0.4% to 1.1%	0.1% to 1.1%
Quarterly Dividend Payment As A Constant ⁽³⁾	$ 0.075	$0.00

⁽¹⁾	Expected Volatility Term Structure - The Company estimated the volatility term structure using: (1) the historical volatility of its stock; and (2) the implied volatility provided by its traded options from a trailing month’s average of the closing bid-ask price quotes.

⁽²⁾	Risk-Free Interest Rate - The Company estimated the risk-free interest rate based upon the implied yield available on U.S. Treasury issues using the Treasury bond rate as of the date of grant.

⁽³⁾	Quarterly Dividend Payment As A Constant – The Company assumed a constant quarterly dividend of $0.075 per share. Prior to 2016, the Company had no recent history of dividend payments.

RSUs With Service And Performance Conditions

In addition to the RSUs included in the table above summarizing the activity in RSUs under the Plan, the Company issued RSUs with both service and performance conditions. Vesting of performance-based awards, if any, is dependent upon the achievement of certain performance targets. If the performance standards are not achieved, all unvested shares will expire and any accrued expense will be reversed. The Company determines the requisite service period on a case-by-case basis to determine the expense recognition period for non-vested performance based RSUs. The fair value is determined based upon the closing price of the Company’s common stock on the date of grant. The Company applies a quarterly probability assessment in computing its non-cash compensation expense and any change in the estimate is reflected as a cumulative adjustment to expense in the quarter of the change.

The following table reflects the activity of RSUs with service and performance conditions:


	Six Months			Year
	Ended			Ended
	June 30,			December 31,
	2016			2015
	(amounts in thousands, except per share data)
Reconciliation Of RSUs With Service And Performance Conditions
Beginning of period balance		29			8
Number of RSUs granted		—			21
Number of RSUs that did not meet criteria		(8	)		—
Number of RSUs vested		—			—

End of period balance		21			29

Average fair value of RSUs granted with performance conditions	$	—		$	11.11

As of June 30, 2016, no non-cash compensation expense was recognized for RSUs with performance conditions.

Option Activity

The following table provides summary information related to the exercise of stock options:


	Six Months Ended June 30,
Option Exercise Data	2016		2015
	(amounts in thousands)
Intrinsic value of options exercised	$	238	$	72

Tax benefit from options exercised ⁽¹⁾	$	92	$	27

Cash received from exercise price of options exercised	$	30	$	31

⁽¹⁾	Amount excludes impact from suspended income tax benefits and/or valuation allowances.

The following table presents the option activity during the current period under the Plan:


								Weighted		Intrinsic
						Weighted		Average		Value
						Average		Remaining		As Of
			Number Of			Exercise		Contractual		June 30,
	Period Ended		Options			Price		Term (Years)		2016
Options outstanding as of:		December 31, 2015		466,925		$	1.93
Options granted				—			—
Options exercised				(22,500	)		1.34
Options forfeited				—
Options expired				(3,125	)

Options outstanding as of:		June 30, 2016		441,300		$	1.96		2.6	$	5,123,485

Options vested and expected to vest as of:		June 30, 2016		441,300		$	1.96		2.6	$	5,123,485

Options vested and exercisable as of:		June 30, 2016		441,300		$	1.96		2.6	$	5,123,485

Weighted average remaining recognition period in years				—

Unamortized compensation expense, net of estimated forfeitures			$	7,066

The following table summarizes significant ranges of outstanding and exercisable options as of the current period:


			Options Outstanding						Options Exercisable
			Number Of		Weighted				Number Of
			Options		Average		Weighted		Options		Weighted
Range Of			Outstanding		Remaining		Average		Exercisable		Average
Exercise Prices			June 30,		Contractual		Exercise		June 30,		Exercise
From	To		2016		Life		Price		2016		Price
$ 1.34	$	1.34		407,675		2.6	$	1.34		407,675	$	1.34
$ 2.02	$	11.78		33,625		2.2	$	9.48		33,625	$	9.48

$ 1.34	$	11.78		441,300		2.6	$	1.96		441,300	$	1.96

Recognized Non-Cash Stock-Based Compensation Expense

The following non-cash stock-based compensation expense, which is related primarily to RSUs, is included in each of the respective line items in our statement of operations:


	Six Months Ended
	June 30,
	2016		2015
	(amounts in thousands)
Station operating expenses	$	590	$	545
Corporate general and administrative expenses		2,429		1,997

Stock-based compensation expense included in operating expenses		3,019		2,542
Income tax benefit ⁽¹⁾		1,083		936

Net stock-based compensation expense	$	1,936	$	1,606


	Three Months Ended
	June 30,
	2016		2015
	(amounts in thousands)
Station operating expenses	$	363	$	368
Corporate general and administrative expenses		1,174		1,062

Stock-based compensation expense included in operating expenses		1,537		1,430
Income tax benefit ⁽¹⁾		531		523

Net stock-based compensation expense	$	1,006	$	907

⁽¹⁾	Amount excludes impact from suspended income tax benefits and/or valuation allowances.

7.	INCOME TAXES

Tax Rates For The Six Months And Three Months Ended June 30, 2016

The effective income tax rates were 35.9% and 41.2% for the six months and three months ended June 30, 2016, respectively. These rates were impacted by discrete income tax benefits from recent legislation in certain single member states that allowed for: (1) the reversal of partial valuation allowances; and (2) a retroactive decrease in deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill. The income tax rate was also impacted by income tax expense from: (i) an increase in deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill; (ii) an adjustment for expenses that are not deductible for tax purposes; and (iii) a tax benefit shortfall associated with share-based awards.

Tax Rates For The Six Months And Three Months Ended June 30, 2015

The effective income tax rates were 41.0% and 40.3% for the six months and three months ended June 30, 2015, respectively. These rates were impacted by an adjustment for expenses that are not deductible for tax purposes, an increase in net deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill and a tax benefit shortfall associated with stock-based awards.

Net Deferred Tax Assets And Liabilities

As of June 30, 2016 and December 31, 2015, net deferred tax liabilities were $86.4 million and $78.2 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.

8.	FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value Of Financial Instruments Subject To Fair Value Measurements

Recurring Fair Value Measurements

The following table sets forth the Company’s financial assets and/or liabilities that were accounted for at fair value on a recurring basis and are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value and its placement within the fair value hierarchy levels.


	Value Measurements At Reporting Date
	June 30,		December 31,
Description	2016		2015
	(amounts in thousands)
Liabilities
Deferred compensation - Level 1 ⁽¹⁾	$	10,154	$	10,137

⁽¹⁾

The Company’s deferred compensation liability, which is included in other long-term liabilities, is recorded at fair value on a recurring basis. The unfunded plan allows participants to hypothetically invest in various specified investment options. The deferred compensation plan liability is valued at Level 1 as it is based on quoted market prices of the underlying investments.

Non-Recurring Fair Value Measurements

The Company has certain assets that are measured at fair value on a non-recurring basis and are adjusted to fair value only when the carrying values are more than the fair values. The categorization of the framework used to price the assets is considered Level 3, due to the subjective nature of the unobservable inputs used to determine the fair value.

During the quarters ended June 30, 2016 and 2015, the Company reviewed the fair value of its broadcasting licenses, goodwill and net property and equipment and other intangibles, and concluded that these assets were not impaired as the fair value of these assets equaled or exceeded their carrying value.

Fair Value Of Financial Instruments Subject To Disclosures

The carrying amount of the following assets and liabilities approximates fair value due to the short maturity of these instruments: (1) cash and cash equivalents; (2) accounts receivable; and (3) accounts payable, including accrued liabilities.

The following table presents the carrying value of financial instruments and, where practicable, the fair value as of the periods indicated:


	June 30,				December 31,
	2016				2015
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value
	(amounts in thousands)
Term B Loan ⁽¹⁾	$	230,000	$	230,288	$	242,750	$	242,447

Revolver ⁽²⁾	$	17,000	$	17,000	$	26,000	$	26,000

Senior Notes ⁽³⁾	$	218,453	$	230,468	$	218,269	$	227,000

Other debt ⁽⁴⁾	$	94			$	—

Letters of credit ⁽⁵⁾	$	670			$	670

The following methods and assumptions were used to estimate the fair value of financial instruments:

⁽¹⁾	The Company’s determination of the fair value of the Term B Loan was based on quoted prices for this instrument and is considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽²⁾	The fair value of the Revolver is considered to approximate the carrying value as the interest payments are based on LIBOR rates that reset periodically. The Revolver is considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽³⁾

The Company utilizes a Level 2 valuation input based upon the market trading prices of the Senior Notes to compute the fair value as these Senior Notes are traded in the debt securities market. The Senior Notes are considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽⁴⁾	The Company does not believe it is practicable to estimate the fair value of the other debt.

⁽⁵⁾	The Company does not believe it is practicable to estimate the fair value of the outstanding standby letters of credit.

9.	BUSINESS COMBINATIONS

The Company consummated acquisitions under the purchase method of accounting, and the purchase price was allocated to the assets and liabilities based upon their respective fair values as determined as of the acquisition date. Merger and acquisition costs are excluded from the purchase price as these costs are expensed for book purposes and amortized for tax purposes.

There were no acquisitions during the six months ended June 30, 2016.

Disposition

In March 2016, the Company sold certain assets of KRWZ AM in Denver, Colorado, for $3.8 million in cash. The Company believes that the sale of this station, with a marginal market share, will not alter the Company’s competitive position in the market. The Company reported a gain, net of expenses, of $0.3 million on the disposition of these assets.

Merger And Acquisition Costs And Restructuring Charges

Merger and acquisition costs and restructuring charges were expensed as a separate line item in the statement of operations. These costs consisted primarily of legal, professional and advisory services as well as restructuring costs (as identified below) related to the Company’s integration of its acquisitions in 2015.

The restructuring plan included: (1) costs associated with exiting contractual vendor obligations as these obligations were duplicative; (2) a workforce reduction and realignment charges that included one-time termination benefits and related costs; and (3) lease abandonment costs. The lease abandonment costs are longer-term as the lease expires in June 2026. The estimated amount of unpaid restructuring charges as of June 30, 2016, after excluding the lease abandonment liability as of June 30, 2016, was included in accrued expenses as most expenses are expected to be paid within one year.


	Six Months Ended
	June 30,
	2016		2015
	(amounts in thousands)
Restructuring charges
Costs to exit duplicative contracts	$	—	$	—
Workforce reduction		—		—
Lease abandonment costs		—		—
Changes in estimates		—		—

Total restructuring charges		—		—
Merger and acquisition costs		—		3,754

Total merger & acquisition costs and restructuring charges	$	—	$	3,754


	Six Months			Year
	Ended			Ended
	June 30,			December 31,
	2016			2015
	(amounts in thousands)
Restructuring charges, beginning balance	$	1,686		$	—
Additions to reserves through accruals		—			2,858
Deductions from reserves through payments		(684	)		(1,172	)

Restructuring charges unpaid and outstanding		1,002			1,686
Less lease abandonment costs over a long-term period		(687	)		(687	)

Short-term restructuring charges unpaid and outstanding	$	315		$	999

Unaudited Pro Forma Summary Of Financial Information

The following pro forma information presents the consolidated results of operations as if the business combinations in 2015 had occurred as of January 1, 2014, after giving effect to certain adjustments, including: (1) depreciation and amortization of assets; (2) amortization of unfavorable contracts related to the fair value adjustments of the assets acquired; (3) change in the effective tax rate; (4) interest expense on any debt incurred; (5) merger and acquisition costs and restructuring charges; and (6) accrued dividends on perpetual cumulative convertible preferred stock. For purposes of this presentation, the pro forma data: (a) excludes certain radio stations that were acquired and immediately disposed as the Company never operated these stations and does not expect to operate these stations at a future time; and (b) excludes a radio station disposed and previously owned and operated by the Company as these assets were a key component of the assets acquired. In addition, there was no adjustment to the pro forma information for the AM station in Denver, Colorado, that was disposed of in 2016. These unaudited pro forma results 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 results which may occur in the future.


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
	Actual		Pro Forma		Actual		Pro Forma
Net revenues	$	120,478	$	115,277	$	216,581	$	206,412

Net income (loss) available to the Company	$	10,834	$	7,301	$	15,246	$	7,838

Net income (loss) available to common shareholders	$	10,422	$	6,751	$	14,421	$	6,738

Net income (loss) available to common shareholders per common share - basic	$	0.27	$	0.18	$	0.37	$	0.18

Net income (loss) available to common shareholders per common share - diluted	$	0.26	$	0.17	$	0.37	$	0.17

Weighted shares outstanding basic		38,469		38,074		38,463		38,071

Weighted shares outstanding diluted		41,130		38,929		39,274		39,027

Conversion of preferred stock for dilutive purposes under the as if method		dilutive		anti-dilutive		anti-dilutive		anti-dilutive

10.

ASSETS HELD FOR SALE

Long-lived assets to be sold are classified as held for sale in the period in which they meet all the criteria for the disposal of long-lived assets. The Company measures assets held for sale at the lower of their carrying amount or fair value less cost to sell. Additionally, the Company determined that these assets comprise operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the Company.

During the six months ended June 30, 2016, the Company disposed of the following assets that were previously reflected as held for sale as of December 31, 2015: (1) an AM radio station in Denver, Colorado, that resulted in a gain on disposal of assets of $0.3 million; (2) land, building and a tower at a tower/antenna site sold to a government agency at carrying value; and (3) land and a building that the Company formerly used as its main studio facility in one of its markets and a co-located tower/antenna structure for two of its AM radio stations that the Company plans to relocate to other suitable sites, that resulted in a gain on disposal of assets of $0.7 million.

11.

SHAREHOLDERS’ EQUITY

Dividends

During the second quarter of 2016, the Company commenced a quarterly common stock dividend program of $0.075 per share and paid $2.9 million. Any future dividends will be at the discretion of the Board of Directors based upon the relevant factors at the time of such consideration, including, without limitation, compliance with the restrictions set forth in the Company’s Credit Facility and the indenture governing the Senior Notes.

The Company paid dividends of $0.4 million on its perpetual cumulative convertible preferred stock in each of the first two quarters of 2016.

Dividend Equivalents

The Company’s grants of RSUs include the right, upon vesting, to receive a cash payment equal to the aggregate amount of dividends, if any, that holders would have received on the shares of common stock underlying their RSUs if such RSUs had been vested during the period.

The following table presents the amounts accrued and unpaid on unvested RSUs:


		Dividend Equivalent Liabilities
	Balance Sheet	June 30,		December 31,
	Location	2016		2015
		(amounts in thousands)
Short-term	Other current liabilities	$	44	$	—
Long-term	Other long-term liabilities		238		210

total		$	282	$	210

Employee Stock Purchase Plan

The Company adopted an employee stock purchase plan (“ESPP”) during the second quarter of 2016 that commenced with the third quarter of 2016. The ESPP will allow participants to purchase the Company’s stock at a discount and will consist of four quarterly offering periods during each year. The maximum number of shares authorized to be issued under the ESPP is 1.0 million.

12.

CONTINGENCIES AND COMMITMENTS

Contingencies

The Company is subject to various outstanding claims which arise in the ordinary course of business and to other legal proceedings. Management anticipates that 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. There were no material changes from the contingencies listed in the Company’s Form 10-K, filed with the SEC on February 26, 2016.

13.

SUBSEQUENT EVENTS

Events occurring after June 30, 2016 and through the date that these consolidated financial statements were issued were evaluated to ensure that any subsequent events that met the criteria for recognition have been included.

ITEM 2.

Management’s Discussion And Analysis Of Financial Condition And Results Of Operations

In preparing the discussion and analysis contained in this Item 2, we presume that readers have read or have access to the discussion and analysis contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 26, 2016. In addition, you should read the following discussion and analysis of our financial condition and results of operations 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 six and three months ended June 30, 2016 as compared to the comparable periods in the prior year. Our results of operations during the relevant periods represent the operations of the radio stations owned and operated by us.

Results Of Operations For The Year-To-Date

The following significant factors affected our results of operations for the six months ended June 30, 2016 as compared to the six months ended June 30, 2015:

On July 16, 2015, we acquired the stock of Lincoln Financial Media Company (“Lincoln”), which operated radio stations serving the Atlanta, Denver, Miami and San Diego markets (the “Lincoln Acquisition”). The Lincoln Acquisition (other than certain of the Denver stations operated by Bonneville International Corporation (“Bonneville”) as described below) increased our net revenues, station operating expenses, depreciation and amortization and interest expense.

We agreed with Bonneville to exchange certain radio stations in Denver for a radio station in Los Angeles (the “Bonneville Exchange”). Pursuant to a time brokerage agreement (“TBA”), on July 17, 2015, we commenced operations of a radio station in Los Angeles, which increased our net revenues and station operating expenses. That same day, Bonneville commenced operations of certain of our Denver radio stations. This resulted in a decrease to our net revenues and station operating expenses and an increase to our TBA income.

On July 16, 2015, we funded the Lincoln acquisition by: (1) issuing $27.5 million in perpetual cumulative convertible preferred stock (“Preferred”), which resulted in an increase in preferred dividends in the current year; (2) borrowing $42.0 million in cash under our revolving credit facility, which increased debt upon which interest is computed; and (3) using $35.5 million of cash on hand.

During 2015, we incurred merger and acquisition costs of $3.8 million related to our Lincoln acquisition.

Six Months Ended June 30, 2016 As Compared To The Six Months Ended June 30, 2015


	SIX MONTHS ENDED JUNE 30,
	2016			2015			% Change
	(dollars in millions)
NET REVENUES	$	216.6		$	179.0			21	%

OPERATING EXPENSE:
Station operating expenses		154.4			129.4			19	%
Depreciation and amortization expense		5.0			3.9			28	%
Corporate general and administrative expenses		16.1			12.7			27	%
Impairment loss		0.1			—			nmf
Merger and acquisition costs and restructuring charges		—			3.8			(100	%)
Other operating (income) expenses		(1.3	)		(0.7	)		(86	%)

Total operating expense		174.3			149.1			17	%

OPERATING INCOME (LOSS)		42.3			29.9			41	%

OTHER (INCOME) EXPENSE:
Net interest expense		18.5			18.6			(1	%)

TOTAL OTHER EXPENSE		18.5			18.6			(1	%)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)		23.8			11.3			111	%

INCOME TAXES (BENEFIT)		8.6			4.6			87	%

NET INCOME (LOSS) AVAILABLE TO THE COMPANY		15.2			6.7			127	%
Preferred stock dividend		(0.8	)		—			nmf

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	14.4		$	6.7			115	%

Net Revenues

Net revenues increased across most of our markets. For our core stations, which exclude the new stations acquired/disposed of through the Lincoln Acquisition and Bonneville Exchange, net revenues were up in the mid-single digits. Comparing our performance for the new stations to the prior owners’ performance, net revenues also increased mid-single digits. Net revenues from the new stations together with our core stations contributed to our reported overall double digit growth over prior year results.

Excluding the benefit of the net revenues associated with the new stations, net revenues increased the most for our stations located in the Denver, San Francisco and Sacramento markets.

Excluding the benefit of the net revenues associated with the new stations, net revenues decreased the most for our stations located in the New Orleans and Portland markets.

Station Operating Expenses

For our core stations, station operating expenses were up minimally. Comparing our performance for the new stations to the prior owners’ performance, station operating expenses decreased in the low double digits. Station operating expenses from the new stations together with our core stations contributed to the reported overall expense increase over prior year results.

Depreciation And Amortization Expense

Depreciation and amortization expense increased primarily as a result of the depreciation and amortization associated with the assets included in the Lincoln Acquisition.

Corporate General And Administrative Expenses

Corporate general and administrative expenses increased primarily due to an increase in costs associated with: (1) a $1.0 million bonus incurred in connection with a new employment agreement for our chief executive officer; and (2) an increase in non-cash compensation expense.

Operating Income (Loss)

Operating income in the current period benefited from an increase in net revenues, net of station operating expenses, that included the operation of the new stations and the disposition of one station that was effective July 17, 2015.

Interest Expense

Interest expense was flat for the period. The increase in outstanding debt upon which interest is computed as a result of the $42.0 million in borrowings to partially fund the Lincoln acquisition in July 2015, was offset by a decrease in outstanding debt subsequent to the Lincoln acquisition. Our variable interest rates remained flat year over year as our term loan component (“Term B Loan”) includes a LIBOR floor of 1%.

Income (Loss) Before Income Taxes (Benefit)

The increase was largely attributable to the positive impact of the Lincoln Acquisition on operating income as well as an increase in the core stations’ operating results. The reduction in outstanding debt subsequent to the Lincoln acquisition, despite the $42.0 million increase in borrowings to partially fund the Lincoln acquisition, held interest expense flat.

Income Taxes (Benefit)

Tax Rate For The Six Months Ended June 30, 2016

The effective income tax rate was 35.9%, which was impacted by discrete income tax benefits from recent legislation in certain single member states that allowed for: (1) the reversal of partial valuation allowances; and (2) a retroactive decrease in deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill. We estimate that our 2016 annual tax rate before discrete items, which may fluctuate from quarter to quarter, will be about 40%.

Tax Rate For The Six Months Ended June 30, 2015

The effective income tax rate was 41.0%, and was impacted by an adjustment for expenses that are not deductible for tax purposes and an increase in net deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill.

Net Deferred Tax Liabilities

As of June 30, 2016 and December 31, 2015, our net deferred tax liabilities were $86.4 million and $78.2 million, respectively. The deferred tax liabilities primarily relate to differences between the book and tax bases of our broadcasting licenses and goodwill.

Net Income (Loss) Available To The Company

The increase was primarily attributable to the reasons described above under Income Before Income Taxes, net of income tax expense.

Results Of Operations For The Quarter

The following significant factor affected our results of operations for the three months ended June 30, 2016 as compared to the same period in the prior year:

The Lincoln Acquisition (other than certain of the Denver stations operated by Bonneville as described below), increased our net revenues, station operating expenses, depreciation and amortization and interest expense.

Pursuant to a TBA with Bonneville, on July 17, 2015, we commenced operations of a radio station in Los Angeles, which increased our net revenues and station operating expenses. That same day, Bonneville commenced operations of certain of our Denver radio stations. This resulted in a decrease to our net revenues and station operating expenses and an increase to our TBA income.

During the second quarter of 2015, we incurred merger and acquisition costs of $2.0 million related to our acquisition from Lincoln.

Three Months Ended June 30, 2016 As Compared To The Three Months Ended June 30, 2015


	THREE MONTHS ENDED JUNE 30,
	2016			2015			% Change
	(dollars in millions)
NET REVENUES	$	120.5		$	100.6			20	%

OPERATING EXPENSE:
Station operating expenses		82.6			70.0			18	%
Depreciation and amortization expense		2.5			1.9			32	%
Corporate general and administrative expenses		8.5			6.5			31	%
Merger and acquisition costs and restructuring charges		—			2.0			(100	%)
Other operating (income) expenses		(0.7	)		(0.4	)		(75	%)

Total operating expense		92.9			80.0			16	%

OPERATING INCOME (LOSS)		27.6			20.6			34	%

OTHER (INCOME) EXPENSE:
Net interest expense		9.2			9.3			(1	%)

TOTAL OTHER EXPENSE		9.2			9.3			(1	%)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)		18.4			11.3			63	%

INCOME TAXES (BENEFIT)		7.6			4.6			65	%

NET INCOME (LOSS) AVAILABLE TO THE COMPANY		10.8			6.7			61	%
Preferred stock dividend		(0.4	)		—			nmf

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	10.4		$	6.7			55	%

Net Revenues

The increase in net revenues was primarily attributable to the net revenues from the Lincoln Acquisition. For our core stations, net revenues were up in the mid-single digits. Comparing our performance for the new stations to the prior owners’ performance, net revenues also increased mid-single digits. Net revenues from the new stations together with our core stations contributed to our reported overall double digit growth over prior year results.

Excluding the benefit of the net revenues associated with the new stations, net revenues increased the most for our stations located in the Denver, Kansas City and San Francisco markets.

Excluding the benefit of the net revenues associated with the new stations, net revenues decreased the most for our stations located in the New Orleans and Portland markets.

Station Operating Expenses

For our core stations, station operating expenses were up minimally. Comparing our performance for the new stations to the prior owners’ performance, station operating expenses decreased in the low double digits. Station operating expenses from the new stations together with our core stations contributed to our reported overall expense increase over prior year results.

Depreciation And Amortization Expense

Depreciation and amortization expense increased primarily as a result of the depreciation and amortization associated with the assets included in the Lincoln Acquisition.

Corporate General And Administrative Expenses

Operating Income (Loss)

Operating income increased primarily due to: (1) the increase in net revenues, net of station operating expenses, associated with the Lincoln Acquisition; and (2) the $2.0 million decrease in merger and acquisition costs and restructuring charges related to the Lincoln acquisition.

Interest Expense

The decrease in interest expense was primarily due to lower outstanding debt upon which interest is computed, offset by borrowing under the revolving credit facility, which has a higher interest rate as compared to the interest rate on our Term B Loan. Our variable interest rates remained flat year over year as our Term B Loan includes a LIBOR floor of 1%.

Income (Loss) Before Income Taxes (Benefit)

The increase was primarily due to the impact on net revenues of the Lincoln Acquisition. This increase was offset primarily due to increased station operating expenses as the variable expenses included in station operating expenses correlated to increased net revenues.

Income Taxes (Benefit)

For the current and prior periods, the income tax rate was 41.2% and 40.3%, respectively, which primarily reflects adjustments for expenses that are not deductible for tax purposes and an increase in net deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill.

Net Income (Loss) Available To The Company

The increase was primarily attributable to the reasons described above under Income Before Income Taxes, net of Income Taxes.

Liquidity And Capital Resources

Liquidity

As of June 30, 2016, we had $247.0 million outstanding under our senior secured credit facility (the “Credit Facility”), which includes an outstanding Term B Loan of $230.0 million and an outstanding revolving credit facility (the “Revolver”) of $17.0 million. In addition, we had outstanding $220.0 million in principal for our 10.5% senior unsecured notes (the “Senior Notes”) and $0.7 million in outstanding letters of credit. As of June 30, 2016, we had $11.1 million in cash and cash equivalents. For the six months months ended June 30, 2016, we decreased our outstanding debt by $21.7 million.

The Credit Facility

On November 23, 2011, we entered into a credit agreement with a syndicate of lenders for a $425 million Credit Facility, which was initially comprised of: (a) a $50 million Revolver (reduced to $40.0 million in December 2015) that matures on November 23, 2016; and (b) a $375 million Term B Loan that matures on November 23, 2018.

The undrawn amount of the Revolver was $22.3 million as of June 30, 2016. The amount of the Revolver available to us is a function of covenant compliance at the time of borrowing.

The Term B Loan requires mandatory prepayments equal to a percentage of Excess Cash Flow, which is defined within the agreement and is subject to incremental step-downs depending on the Consolidated Leverage Ratio. The payment, which is currently estimated at 25% of Excess Cash Flow, is due in the first quarter of each year. An estimate of this payment that is due next year, net of any prepayments made through June 30, 2016, is included under the current portion of long-term debt. We expect to fund the payments using cash from operating activities.

As of June 30, 2016, we are in compliance with all financial covenants and all other terms of the Credit Facility in all material respects. Our ability to maintain compliance with our covenants will be highly dependent on our results of operations. A default under our Credit Facility or the indenture governing our Senior Notes could cause a cross default in the other. Any event of default could have a material adverse effect on our business and financial condition.

We believe that over the next 12 months we can continue to maintain our compliance with these covenants. Our operating cash flow remains positive, and we believe that cash on hand and cash from operating activities will be sufficient to permit us to meet our liquidity requirements over the next 12 months, including our debt repayments.

Failure to comply with our financial covenants or other terms of our Credit Facility and any subsequent failure to negotiate and obtain any required relief from our lenders could result in the acceleration of the maturity of all outstanding debt. Under these circumstances, the acceleration of our debt could have a material adverse effect on our business. We may seek from time to time to amend our Credit Facility or obtain other funding or additional financing, which may result in higher interest rates.

Credit Facility’s Financial Covenants

As of June 30, 2016, our Consolidated Leverage Ratio was 3.9 times versus a covenant of 4.5 times and our Consolidated Interest Coverage Ratio was 3.4 times versus a covenant of 2.0 times.

The Senior Notes

The Senior Notes may be redeemed at any time prior to December 1, 2016 at 105.25% of the principal amount plus accrued interest. The redemption price decreases over time.

Simultaneously with entering into the Credit Facility on November 23, 2011, we issued the Senior Notes which mature on December 1, 2019 in the amount of $220.0 million. Interest on the Senior Notes is payable semi-annually in arrears on June 1 and December 1 of each year.

In addition to the parent, Entercom Communications Corp., all of our existing subsidiaries (other than Entercom Radio, LLC, which is a finance subsidiary and is the issuer of the Senior Notes), jointly and severally guaranteed the Senior Notes. Under certain covenants, our subsidiary guarantors are restricted from paying dividends or distributions in excess of amounts defined under the Senior Notes, and the subsidiary guarantors are limited in their ability to incur additional indebtedness under certain restrictive covenants.

A default under our Senior Notes could cause a default under our Credit Facility. Any event of default could have a material adverse effect on our business and financial condition.

Perpetual Cumulative Convertible Preferred Stock

Upon closing on the Lincoln Acquisition, we issued Preferred that in the event of a liquidation, ranks senior to common stock in our capital structure. The Preferred is convertible by Lincoln into a fixed number of shares after a three-year waiting period, subject to customary anti-dilution provisions. At certain times (including the first three years after issuance), we can redeem the Preferred in cash at a price of 100%. The dividend rate on the Preferred increases over time from 6% to 12%. We declared and paid a $0.4 million dividend on our Preferred, commencing in October 2015 and each subsequent quarter thereafter through and including July 2016.

Operating Activities

Net cash flows provided by operating activities were $24.6 million and $19.9 million for the six months ended June 30, 2016 and 2015, respectively. The cash flows from operating activities increased primarily due to the increase in net revenues, net of station operating expenses, from the Lincoln Acquisition and Bonneville Exchange.

Investing Activities

Net cash flows provided by investing activities were $4.9 million for the six months ended June 30, 2016 and net cash flows used in investing activities were $4.8 million for the six months ended June 30, 2015.

For the six months ended June 30, 2016, the cash provided by investing activities primarily reflects the proceeds from the sale of several properties that were reflected under assets held for sale as of December 31, 2015, offset by additions to property and equipment of $2.0 million. For the six months ended June 30, 2015, the cash used in investing activities primarily reflects the additions to property and equipment of $4.7 million.

Financing Activities

Net cash flows used in financing activities were $27.6 million and $3.0 million for the six months ended June 30, 2016 and 2015, respectively.

For the six months ended June 30, 2016 the cash flows used in financing activities primarily reflect the reduction of our net borrowings of $21.7 million and the payment of a common stock dividend of $2.9 million. For the six months ended June 30, 2015, the cash flows used in financing activities primarily reflect $1.5 million for the purchase of vested restricted stock units to satisfy employees’ tax obligations and a reduction of our net borrowings of $1.5 million.

Dividends

During the second quarter of 2016, we commenced the payment of a quarterly $0.075 per share common stock dividend program and paid $2.9 million. Any future dividends will be at the discretion of the Board of Directors based upon the relevant factors at the time of such consideration, including, without limitation, compliance with the restrictions set forth in our Credit Facility and the indenture governing the Senior Notes.

A dividend on our Preferred of $0.4 million was paid in each of our first two quarters of 2016.

Income Taxes

During the six months ended June 30, 2016, we paid $0.2 million in federal and state income taxes. The payment was primarily for a federal alternative minimum tax (“AMT”), which is a credit available to offset income tax liabilities in future years. We expect to continue to make additional AMT payments in subsequent quarters of approximately $0.2 million in the aggregate. We anticipate that it will not be necessary to make any other quarterly estimated federal or state income tax payments for the remainder of 2016 based upon available net operating loss carryovers, existing prepayments and expected quarterly income subject to tax.

Capital Expenditures

Capital expenditures for the six months ended June 30, 2016 were $2.0 million. We anticipate that total capital expenditures in 2016 will be between $7 million and $8 million. Capital expenditures this year are estimated to be lower than anticipated primarily due to a delay in the move of studio facilities in several markets.

Contractual Obligations

As of June 30, 2016, there have been no net material changes in the total amount from the contractual obligations listed in our Form 10-K for the year ended December 31, 2015, filed with the SEC on February 26, 2016.

Off-Balance Sheet Arrangements

As of June 30, 2016, we did not have any material off-balance sheet transactions, arrangements or obligations, including contingent obligations.

Critical Accounting Policies

The SEC defines critical accounting policies as those that are most important to the portrayal of a company’s financial condition and results and that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

There have been no material changes to our critical accounting policies from the information provided in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies, in our Annual Report on Form 10-K for the year ended December 31, 2015. We have, however, provided additional disclosures related to one of our critical accounting policies for impairment testing of radio broadcasting licenses and goodwill, as we conducted our annual impairment test of broadcasting licenses and goodwill during the second quarter of 2016.

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 June 30, 2016, we have recorded approximately $840 million in radio broadcasting licenses and goodwill, which represents 83% of our total assets at that date. We must conduct impairment testing at least annually, or more frequently if events or changes in circumstances indicate that the assets might be impaired, and charge to operations an impairment expense in the periods in which the recorded value of these assets is more than their fair value. Any such impairment could be material. After an impairment expense is recognized, the recorded value of these assets will be reduced by the amount of the impairment expense and that result will be the assets’ new accounting basis. Our most recent impairment loss to our broadcasting licenses and goodwill was in 2012.

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 uses assumptions that incorporate variables based on past experiences and judgments about future performance of our stations.

Broadcasting Licenses Impairment Test

We completed our annual impairment test for broadcasting licenses during the second quarter of 2016 and determined that the fair value of the broadcasting licenses was more than the carrying value in each of our markets and, as a result, we did not record an impairment loss.

We perform our broadcasting license impairment test by using the direct method at the market level. Each market’s broadcasting licenses are combined into a single unit of accounting for the purpose of testing impairment, as the broadcasting licenses in each market are operated as a single asset. We determine the fair value of broadcasting licenses in each of our markets by relying on a discounted cash flow approach (a 10-year income model) assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. Our fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. These assumptions include, but are not limited to: (1) the discount rate; (2) the market share and

profit margin of an average station within a market, based upon market size and station type; (3) the forecast growth rate of each radio market; (4) the estimated capital start-up costs and losses incurred during the early years; (5) the likely media competition within the market area; (6) a tax rate; and (7) future terminal values. Changes in our estimates of the fair value of these assets could result in material future period write-downs in the carrying value of our broadcasting licenses and goodwill assets.

The methodology used by us in determining our key estimates and assumptions was applied consistently to each market. Of the seven variables identified above, we believe that the first three (in items (1) through (3) above) are the most important and sensitive in the determination of fair value.

The following table reflects the estimates and assumptions used in 2016 as compared to the second quarter of 2015, the date of the most recent prior impairment test:


	Estimates And Assumptions
	Second	Second
	Quarter	Quarter
	2016	2015
Discount rate	9.5%	9.7%
Operating profit margin ranges expected for average stations in the markets where the Company operates	14% to 40%	25% to 40%
Long-term revenue growth rate range of the Company’s markets	1.0% to 2.0%	1.5% to 2.0%

We believe we have made reasonable estimates and assumptions to calculate the fair value of our broadcasting licenses; however, these estimates and assumptions could be materially different from actual results.

If actual market conditions are less favorable than those projected by the industry or by us, or if events occur or circumstances change that would reduce the fair value of our broadcasting licenses below the carrying value, we may be required to recognize impairment charges, which could be material, in future periods.

The table below presents the percentage within a range by which the fair value exceeded the carrying value of our radio broadcasting licenses as of June 30, 2016 for 24 units of accounting (24 geographical markets) where the carrying values of the licenses are considered material to our financial statements (three of our 27 markets are considered immaterial). Rather than presenting the percentage separately for each unit of accounting, management’s opinion is that this table in summary form is more meaningful to the reader in assessing the recoverability of the broadcasting licenses. In addition, the units of accounting are not disclosed with the specific market name as such disclosure could be competitively harmful to us.


	Units Of Accounting As Of June 30, 2016 Based Upon The Valuation As Of June 30, 2016 Percentage Range By Which Fair Value Exceeds The Carrying Value
			Greater		Greater		Greater
	0% To		Than 5%		Than 10%		Than
	5%		To 10%		To 15%		15%
Number of units of accounting		7		5		1		11
Carrying value (in thousands)	$	360,697	$	224,950	$	18,718	$	206,072

Broadcasting Licenses Valuation At Risk

The second quarter 2016 impairment test of our broadcasting licenses indicated that there were 12 units of accounting where the fair value exceeded their carrying value by 10% or less. In aggregate, these 12 units of accounting have a carrying value of $585.6 million. If overall market conditions or the performance of the economy deteriorates, advertising expenditures and radio industry results could be negatively impacted, including expectations for future growth. This could result in future impairment charges for these or other of our units of accounting.

Goodwill Impairment Test

We perform our annual goodwill impairment test during the second quarter of each year by evaluating our goodwill for each reporting unit. We determined that a radio market is a reporting unit and, in total, we assessed goodwill at 23 separate reporting units (four of our 27 reporting units have no goodwill recorded as of June 30, 2016). If the fair value of 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 we are required to perform a second step of the impairment test. In the second step, we compare the amount reflected in the balance sheet to 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.

To determine the fair value, we use a market approach and, when appropriate, an income approach for each reporting unit. The market approach calculates the fair value of each market’s radio stations by analyzing recent sales and offering prices of similar properties expressed as a multiple of cash flow. The income approach utilizes a discounted cash flow method by projecting the subject property’s income over a specified time and capitalizing at an appropriate market rate to arrive at an indication of the most probable selling price.

In step one of our goodwill analysis, we considered the results of the market and, where appropriate, the income approach in computing the fair value of our reporting units. In the market approach, we applied an estimated market multiple of between seven and a half times and eight times to each reporting unit’s operating performance to calculate the fair value. This multiple was consistent with the multiple applied to all markets in the second quarter of 2015. We also utilized the discounted cash flow method to calculate the fair value of the reporting unit. Management believes that these approaches are an appropriate measurement given the current market valuations of broadcast radio stations together with historical market transactions, including those in recent months. Factors contributing to the determination of the reporting unit’s operating performance were historical performance and management’s estimates of future performance.

The following table reflects certain key estimates and assumptions that applied to our markets and were used in the second quarter of 2016 and in the second quarter of 2015, the date of the most recent prior impairment test:


	Estimates And Assumptions
	Second	Second
	Quarter	Quarter
	2016	2015
Discount rate	9.5%	9.7%
Long-term revenue growth rate range of the Company’s markets	1.0% to 2.0%	1.5% to 2.0%
Market multiple used in the market valuation approach	7.5x to 8.0x	7.5x to 8.0x

The results of step one indicated that it was not necessary to perform the second step analysis in any of the markets tested. As a result of the step one test, no impairment loss was recorded during the second quarter of 2016. We performed a reasonableness test by comparing the fair value results for goodwill (by using the implied multiple based on our consolidated cash flow performance and our current stock price) to prevailing radio broadcast transaction multiples.

If actual market conditions are less favorable than those projected by the industry or us, or if events occur or circumstances change that would reduce the fair value of our goodwill below the amount reflected in the balance sheet, we may be required to conduct an interim test and possibly recognize impairment charges, which could be material, in future periods.

The table below presents the percentage within a range by which the fair value exceeded the carrying value of the reporting unit as of June 30, 2016 for 23 reporting units under step one of the goodwill impairment test during

the second quarter of 2016. Rather than presenting the percentage separately for each reporting unit, management’s opinion is that this table in summary form is more meaningful to the reader in assessing the recoverability of the reporting unit, including goodwill. In addition, the reporting units are not disclosed with the specific market name as such disclosure could be competitively harmful to us.


	Reporting Units As Of June 30, 2016 Based Upon The Valuation As Of June 30, 2016 Percentage Range By Which Fair Value Exceeds Carrying Value
			Greater		Greater		Greater
	0% To		Than 5%		Than 10%		Than
	5%		To 10%		To 15%		15%
Number of reporting units		4		2		1		16
Carrying value (in thousands)	$	296,670	$	104,674	$	9,142	$	440,468

Goodwill Valuation At Risk

The second quarter 2016 impairment test of our goodwill indicated that there were six reporting units that exceeded the carrying value by 10% or less. In aggregate, these six reporting units have a carrying value of $401.3 million, of which $10.9 million is goodwill.

Future impairment charges may be required on any of our reporting units, as the discounted cash flow and market-based models are subject to change based upon our performance, our stock price, peer company performance and their stock prices, overall market conditions, and the state of the credit markets.

Sensitivity Of Key Broadcasting Licenses And Goodwill Assumptions

If we were to assume a 100 basis point change in certain of our key assumptions (a reduction in the long-term revenue growth rate, a reduction in the operating performance cash flow margin and an increase in the weighted average cost of capital) used to determine the fair value of our broadcasting licenses and goodwill using the income approach during the second quarter of 2016, the following would be the incremental impact:

Sensitivity Analysis ⁽¹⁾

Results Of

Long-Term

Operating

Weighted

Revenue

Performance

Average

Growth

Cash Flow

Cost Of

Rate

Margin

Capital

Decrease

Increase

(amounts in thousands)

Broadcasting Licenses

Incremental broadcasting licenses impairment

29,471

3,727

67,774

Goodwill ⁽²⁾

Incremental goodwill impairment

13,161

1,252

30,687

⁽¹⁾	Each assumption used in the sensitivity analysis is independent of the other assumptions.

⁽²⁾	The sensitivity goodwill analysis is computed using data from testing goodwill using the income approach under step 1.

To determine the radio broadcasting industry’s future revenue growth rate, management uses publicly available information on industry expectations rather than management’s own estimates, which could be different. In

addition, these long-term market growth rate estimates could vary in each of our markets. Using the publicly available information on industry expectations, each market’s revenues were forecasted over a ten-year projection period to reflect the expected long-term growth rate for the radio broadcast industry, which was further adjusted for each of our markets. If the industry’s growth is less than forecasted, then the fair value of our broadcasting licenses could be negatively impacted.

Operating profit is defined as profit before interest, depreciation and amortization, income tax and corporate allocation charges. Operating profit is then divided by broadcast revenues, net of agency and national representative commissions, to compute the operating profit margin. For the broadcast license fair value analysis, the projections of operating profit margin that are used are based upon industry operating profit margin norms, which reflect market size and station type. These margin projections are not specific to the performance of our radio stations in a market, but are predicated on the expectation that a new entrant into the market could reasonably be expected to perform at a level similar to a typical competitor. For the goodwill fair value analysis, the projections of operating margin for each market are based on our actual historical performance. If the outlook for the radio industry’s growth declines, then operating profit margins in both the broadcasting license and goodwill fair value analyses would be negatively impacted, which would decrease the value of those assets.

The discount rate to be used by a typical market participant reflects the risk inherent in future cash flows for the broadcast industry. The same discount rate was used for each of our markets. The discount rate is calculated by weighting the required returns on interest-bearing debt and common equity capital in proportion to their estimated percentages in an expected capital structure. The capital structure was estimated based upon data available for publicly traded companies in the broadcast industry.

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 (the Term B Loan and Revolver). If the borrowing rates under London Interbank Offered Rate (“LIBOR”) were to increase 1% above the current rates as of June 30, 2016, our interest expense on: (1) our Term B Loan would increase $1.1 million on an annual basis as our Term B Loan provides for a minimum LIBOR floor; and (2) our Revolver would increase by $0.4 million, assuming our entire Revolver was outstanding as of June 30, 2016. From time to time, we may seek to limit our exposure to interest rate volatility through the use of interest rate hedging instruments.

Assuming LIBOR remains flat, interest expense is expected to be lower due to the decrease in our outstanding debt upon which interest is computed.

As of June 30, 2016, there were no interest rate hedging transactions outstanding.

From time to time, we invest in cash equivalents that are money market instruments consisting of short-term government securities and repurchase agreements that are fully collateralized by government securities. When such investments are made, we do not believe that we have any material credit exposure with respect to these assets. As of June 30, 2016, we did not have any investments in money market instruments.

Our credit exposure related to our accounts receivable does not represent a significant concentration of credit risk due to the quantity of advertisers, the minimal reliance on any one advertiser, the multiple markets in which we operate and the wide variety of industries in which our advertisers compete.

See also additional disclosures regarding liquidity and capital resources made under Liquidity and Capital Resources in Part 1, Item 2, 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 Securities Exchange Act of 1934, as amended) 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

There were no material developments relating to the legal proceedings described in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission on February 26, 2016.

ITEM 1A.

Risk Factors

There have been no material changes to the Risk Factors described in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission on February 26, 2016.

ITEM 2.

Unregistered Sales Of Equity Securities And Use Of Proceeds

The following table provides information on our repurchases during the quarter ended June 30, 2016:


Period ⁽¹⁾	(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
April 1, 2016 - April 30, 2016		1,008	$	10.83		—	$	—
May 1, 2016 - May 31, 2016		2,922	$	12.05		—	$	—
June 1, 2016 - June 30, 2016		370	$	12.70		—	$	—

Total		4,300				—

⁽¹⁾

As a result of our withholding shares to satisfy employee tax obligations related to the vesting of restricted stock units during the three months ended June 30, 2016, we are deemed to have repurchased the following shares withheld to satisfy employees’ tax obligations: 1,008 shares at an average price of $10.83 per share in April 2016; 2,922 shares at an average price of $12.05 per share in May 2016; and 370 shares at an average price of $12.70 per share in June 2016. These shares are included in the table above.

ITEM 3.

Defaults Upon Senior Securities

None.

ITEM 4.

Mine Safety Disclosures

N/A

ITEM 5.

Other Information

None.

ITEM 6.

Exhibits


Exhibit Number		Description

3.01		Amended and Restated Articles of Incorporation of Entercom Communications Corp. (1)

3.02		Amended and Restated Bylaws of Entercom Communications Corp. (2)

3.03		Statement with Respect to Shares, filed with the Pennsylvania Department of State on July 16, 2015. (3) (Originally filed as Exhibit 3.1)

4.01		Credit Agreement, dated as of November 23, 2011, among Entercom Radio, LLC, as the Borrower, Entercom Communications Corp., as the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto. (4) (Originally filed as Exhibit 4.1)

4.02		First Amendment to Credit Agreement, dated as of November 27, 2012, among Entercom Radio, LLC, as the Borrower, Entercom Communications Corp., as the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto. (5) (Originally filed as Exhibit 4.02)

4.03		Second Amendment to Credit Agreement, dated as of December 2, 2013, among Entercom Radio, LLC, as the Borrower, Entercom Communications Corp., as the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto. (6) (Originally filed as Exhibit 4.03)

4.04		Indenture, dated as of November 23, 2011, by and among Entercom Radio, LLC, as the Issuer, the Note Guarantors (as defined therein) and Wilmington Trust, National Association, as trustee. (4) (Originally filed as Exhibit 4.2)

4.05		Form of Note. (4) (Originally filed as Exhibit 4.3)

4.06		Registration Rights Agreement, dated July 16, 2015, by and between Entercom Communications Corp. and The Lincoln National Life Insurance Company. (3) (Originally filed as Exhibit 4.1)

10.01		Amended and Restated Employment Agreement, dated as of April 22, 2016, between Entercom Communications Corp. and David J. Field (7)

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. (7)

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. (7)

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. (8)

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. (8)

101.INS		XBRL Instance Document (7)

101.SCH		XBRL Taxonomy Extension Schema Document (7)

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document (7)

101.LAB		XBRL Taxonomy Extension Labels Linkbase Document (7)

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document (7)

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document (7)

(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), Exhibit 3.1 of our Current Report on Form 8-K as filed on December 21, 2007 and Exhibit 3.02 of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2009, as filed on August 5, 2009.

(2)	Incorporated by reference to Exhibit 3.01 of our Current Report on Form 8-K as filed on February 21, 2008.

(3)	Incorporated by reference to an exhibit (as indicated above) to our Current Report on Form 8-K filed on July 17, 2015.

(4)	Incorporated by reference to an exhibit (as indicated above) to our Current Report on Form 8-K filed on November 25, 2011.

(5)	Incorporated by reference to an exhibit (as indicated above) to our Annual Report on Form 10-K for the year ended December 31, 2012, as filed on February 27, 2013.

(6)	Incorporated by reference to an exhibit (as indicated above) to our Annual Report on Form 10-K for the year ended December 31, 2013, as filed on March 3, 2014.

(7)	Filed herewith.

(8)	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: August 5, 2016	/S/ David J. Field
	Name:	David J. Field
	Title:	President and Chief Executive Officer
	(principal executive officer)

Date: August 5, 2016	/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 Entercom Communications Corp. (1)

3.02		Amended and Restated Bylaws of Entercom Communications Corp. (2)

3.03		Statement with Respect to Shares, filed with the Pennsylvania Department of State on July 16, 2015. (3) (Originally filed as Exhibit 3.1)

4.01		Credit Agreement, dated as of November 23, 2011, among Entercom Radio, LLC, as the Borrower, Entercom Communications Corp., as the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto. (4) (Originally filed as Exhibit 4.1)

4.02		First Amendment to Credit Agreement, dated as of November 27, 2012, among Entercom Radio, LLC, as the Borrower, Entercom Communications Corp., as the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto. (5) (Originally filed as Exhibit 4.02)

4.03		Second Amendment to Credit Agreement, dated as of December 2, 2013, among Entercom Radio, LLC, as the Borrower, Entercom Communications Corp., as the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto. (6) (Originally filed as Exhibit 4.03)

4.04		Indenture, dated as of November 23, 2011, by and among Entercom Radio, LLC, as the Issuer, the Note Guarantors (as defined therein) and Wilmington Trust, National Association, as trustee. (4) (Originally filed as Exhibit 4.2)

4.05		Form of Note. (4) (Originally filed as Exhibit 4.3)

4.06		Registration Rights Agreement, dated July 16, 2015, by and between Entercom Communications Corp. and The Lincoln National Life Insurance Company. (3) (Originally filed as Exhibit 4.1)

10.01		Amended and Restated Employment Agreement, dated as of April 22, 2016, between Entercom Communications Corp. and David J. Field (7)

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. (7)

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. (7)

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. (8)

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. (8)

101.INS		XBRL Instance Document (7)

101.SCH		XBRL Taxonomy Extension Schema Document (7)

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document (7)

101.LAB		XBRL Taxonomy Extension Labels Linkbase Document (7)

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document (7)

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document (7)

(1)

(2)	Incorporated by reference to Exhibit 3.01 of our Current Report on Form 8-K as filed on February 21, 2008.

(3)	Incorporated by reference to an exhibit (as indicated above) to our Current Report on Form 8-K filed on July 17, 2015.

(4)	Incorporated by reference to an exhibit (as indicated above) to our Current Report on Form 8-K filed on November 25, 2011.

(5)	Incorporated by reference to an exhibit (as indicated above) to our Annual Report on Form 10-K for the year ended December 31, 2012, as filed on February 27, 2013.

(6)	Incorporated by reference to an exhibit (as indicated above) to our Annual Report on Form 10-K for the year ended December 31, 2013, as filed on March 3, 2014.

(7)	Filed herewith.

(8)	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.

EXHIBIT 10.01

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “ Agreement ”) is made and entered into effective as of April 22, 2016 (the “ Effective Date ”), by and between Entercom Communications Corp., a Pennsylvania corporation (“ Employer ” or the “ Company ”), and David J. Field (“ Executive ”).

RECITALS

A. Prior to the Effective Date, Executive has rendered services to Employer in the position of President and Chief Executive Officer upon and subject to the terms, condition and other provisions of that certain Amended and Restated Employment Agreement between Executive and Employer dated as of December 23, 2010 (the “ Prior Agreement ”).

B. Effective as of the Effective Date, Employer desires to continue to retain the services of Executive upon and subject to the terms, conditions and other provisions set forth herein.

C. Executive desires to continue to render services to Employer upon and subject to the terms, conditions and other provisions set forth herein.

AGREEMENT

NOW, THEREFORE, in consideration of the premises, the mutual promises hereinafter set forth, and other good and valuable consideration had and received, the parties hereby agree as follows:

1. Employment. Upon and subject to the terms, conditions and other provisions of this Agreement, Employer shall continue to employ Executive, and Executive hereby accepts such continued employment and agrees to exercise and perform faithfully, exclusively and to the best of his ability on behalf of Employer during the Employment Term (as defined herein), the duties and responsibilities of President and Chief Executive Officer of Employer, with the general powers and duties of management usually vested in said office.

2. Executive’s Services and Duties.

2.1 During the Employment Term, Executive shall:

2.1.1 Observe and conform to the policies and directions promulgated from time to time by Employer’s Board of Directors (the “ Board ”);

2.1.2 Use all reasonable efforts to serve Employer faithfully, diligently and competently and to the best of his ability; and

2.1.3 Devote his full business time, energy, ability, attention and skill to his employment hereunder.

2.2 The services to be performed by Executive hereunder may be changed or adjusted from time to time at the reasonable discretion of the Board.

2.3 Except with the prior written approval of the Board, Executive during the Employment Term will not: (i) accept any other employment with a third party; (ii) serve on the board of directors or similar body of any other business entity in any way directly or indirectly competitive with the business of the Company; or (iii) engage, directly or indirectly, in any other business activity (whether or not pursued for pecuniary advantage) that is or may be competitive with, or that might place Executive in a competing position to or otherwise conflict with, that of Employer or any of its subsidiaries, affiliates or divisions.

3. Term . Unless terminated earlier as provided in this Agreement, the term of this Agreement shall commence on the Effective Date and shall terminate and expire on the third anniversary thereof (the “ Employment Term ”). The Employment Term shall automatically renew for an additional twelve (12) months from year to year thereafter, unless either party gives at least one hundred twenty (120) days prior written notice of its election to either terminate or to renegotiate the terms of this Agreement at the end of the original or any then current renewal term.

4. Compensation and Other Benefits . As compensation in full for the services to be rendered by Executive hereunder, during the Employment Term, Employer shall pay, and Executive shall be entitled to receive, the following compensation and benefits, which compensation and benefits shall be subject to all appropriate federal, state and local withholding taxes:

4.1 A signing bonus of one million dollars ($1,000,000).

4.2 An annual salary in the amount of one million dollars ($1,000,000) to be paid consistent with the standard payroll practices of Employer in place from time-to-time (the “ Base Compensation ”). Beginning April 22, 2017, and each April 22 thereafter during the Employment Term, Executive’s Base Compensation shall be automatically increased by three (3) percent.

4.3 Executive shall have the opportunity to earn an annual performance bonus (the “ Annual Bonus ”) to be determined by the Compensation Committee of the Board (the “ Compensation Committee ”) to be based on criteria to be established by the Compensation Committee in its discretion. For any fiscal year of the Company, Executive’s target bonus amount under this Section 4.3 shall be one hundred fifty percent (150%) of the Base Compensation for each such fiscal year; provided , however , that the Compensation Committee shall determine the actual bonus amount to be paid for each such fiscal year based on the Company’s and Executive’s performance. Such Annual Bonus shall be payable as soon as reasonably practicable following, and in no event later than two and one-half (2 ¹ ⁄ ₂ ) months following, the end of the fiscal year for which such Annual Bonus is earned.

4.4 Executive shall be entitled to participate in or receive health, disability and life insurance, vacation and similar or other fringe benefits as Employer provides from time-to-time to its most senior executive officers. Nothing in this Section 4.4 , however, is intended, or shall be construed to require Employer to institute or continue any, or any particular, plan or benefits other than insurance benefits which Executive may at his cost continue pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“ COBRA ”). In addition, Executive shall be entitled to use the aircraft that the Company owns or leases from time to time (including time-shares and jet cards) for personal travel use for himself and his family and other personal and business associates, provided that Executive reimburses the Company for the incremental usage fees, fuel charges and in-flight expenses incurred by the Company in connection with any non-business use (but without any allocation of overhead, capital or maintenance charges related thereto).

4.5 During the Employment Term, Executive shall either be provided with a Company-owned automobile for his business and personal use or be provided with a monthly automobile allowance of $1,200.

5. Equity Compensation .

5.1 As soon as reasonably practicable following the Effective Date, the Board or the Compensation Committee shall grant Executive 450,000 RSUs pursuant to the Plan. Provided that, except as set forth in Section 5.1.4, the Executive remains continuously employed in active service by the Company from the date of grant through the Achievement Date (as defined below), the grant of RSUs pursuant to this Section 5.1 shall vest as described below:

5.1.1 Upon the achievement of one (1) or more of the applicable performance targets set forth below as of any date after the Effective Date and on or prior to the thirtieth (30th) day following the third (3rd) anniversary of the Effective Date (the “ Achievement Date ”), a percentage of the RSUs shall become vested on the Achievement Date equal to the highest corresponding percentage in the schedule set forth below.

5.1.2 The shares underlying any portion of the RSUs to become so vested shall be delivered to Executive within ten (10) days of the Achievement Date. Any portion of these RSUs that have not vested pursuant to this Section 5.1.2 by the Achievement Date shall terminate unvested.

5.1.3 The performance targets for these RSUs shall be, as of any date: (i) the share price of our Class A common stock that represents a three (3) year Compound Annual Growth Rate (“ Three Year CAGR ”) of Total Shareholder Return of eight percent (8%), twelve percent (12%) and sixteen percent (16%) targets set forth in the table below, less (ii) the value of any dividends paid on each share of the Company’s Class A common stock during the period commencing on the Effective Date and through such date.


Three Year CAGR*	Percentage of RSUs to Vest Upon Attainment of Performance Target
8%		33 ¹ ⁄ ₃	%
12%		33 ¹ ⁄ ₃	%
16%		33 ¹ ⁄ ₃	%

*	Targets calculated rounding to two (2) decimal places.

For purposes of this Agreement, “Total Shareholder Return” shall mean: (A) (i) the volume-weighted average closing price over any consecutive twenty (20) trading day period of a share of the Company’s Class A common stock minus (ii) the volume-weighted average closing price of the Company’s Class A common stock for the twenty (20) trading days prior to the Effective Date (the “ Base Price ”), divided by (B) the Base Price (in each case, with such adjustments as are necessary, in the judgment of the Board and/or the Compensation Committee to equitably calculate Total Shareholder Return in light of any stock splits, reverse stock splits, stock dividends, dividends in kind, significant asset sales and other extraordinary transactions or other changes in the capital structure of the Company). All closing prices shall be the New York Stock Exchange closing price on the date in question. All determinations with respect to Total Shareholder Return and the Three Year CAGR shall be made by the Board or the Compensation Committee in their sole discretion, acting in good faith, and the applicable performance targets shall not be achieved and the shares shall not vest until the Compensation Committee certifies that such performance targets have been met (which the Compensation Committee agrees to act promptly and in good faith in so doing).

5.1.4 No grant of RSUs pursuant to this Section 5.1 shall vest if applicable performance targets are not met by the Achievement Date. If the Term of this Agreement expires without renewal and Executive’s employment ends during the thirty (30) day period following the third (3 ^rd ) anniversary of the Effective Date (other than for reasons set forth in Section 10.3 ), the requirement for continued employment under Section 5.1 shall be waived for the period from the termination of employment through the Achievement Date.

5.2 As soon as reasonably practicable following the Effective Date, the Board or the Compensation Committee shall grant Executive 225,000 restricted stock units pursuant to the Entercom Equity Compensation Plan. Provided that the Executive remains continuously employed in active service by the Company from the date of grant through such date, 50% of the restricted stock units shall vest on the date that is two (2) years from the Effective Date, 25% of the restricted stock units shall vest on the date that is three (3) years from the Effective Date and 25% of the restricted stock units shall vest on the date that is four (4) years from the Effective Date. The restricted stock units shall contain such other reasonable terms (consistent with the Company’s customary form of restricted stock unit agreement and not inconsistent with this Agreement) as the Board and/or the Compensation Committee determine.

6. Certain Business Expenses . Employer shall reimburse Executive for business expenses: (a) which are reasonable and necessary for Executive to perform and were incurred by Executive in the course of the performance of his duties pursuant to this Agreement and in accordance with Employer’s general policies; and (b) for which Executive has submitted vouchers and completed an expense report in the form required by Employer as consistent with Employer’s policies in place from time to time. The reimbursement of any business expense shall be made no later than December 31 of the year following the year in which the expense was incurred. The amount of expenses reimbursed in one year shall not affect the amount eligible for reimbursement in any subsequent year.

7. Confidential Information .

7.1 Executive acknowledges that, because of his employment hereunder, he will be in a confidential relationship with Employer and will have access to confidential information and trade secrets of Employer and the subsidiaries, affiliates and divisions thereof. Executive acknowledges and agrees that the following constitutes confidential and/or trade secret information belonging exclusively to Employer (collectively, “ Confidential Information ”):

(a) all information related to customers including, without limitation, customer lists, the identities of existing, past or prospective customers, prices charged or proposed to be charged to customers, customer contacts, special customer requirements and all related information;

(b) all marketing plans, materials and techniques;

(d) all patterns, devices, compilations of information, copyrightable material and technical information, if any, in each case which relates in any way to the business of Employer or any subsidiary, affiliate or division thereof.

7.2 Executive agrees that:

7.2.1 Except in the limited performance of his duties under this Agreement, Executive shall not use for his own benefit or disclose to any third party Confidential Information acquired by reason of his employment under this Agreement or his former status as an officer and shareholder of Employer, including, but not limited to, Confidential Information belonging or relating to Employer or its subsidiaries, affiliates, divisions or customers;

7.2.2 Executive shall not induce or persuade other employees of Employer or former or current employees of Employer or any subsidiary, affiliate or division thereof, to join him in any activity prohibited by this Section 7 ;

7.2.3 For the twelve (12) month period following any termination of Executive’s employment with the Company, Executive shall not, without the express prior written permission of the Company, employ, offer to employ, counsel a third party to employ, or participate in any manner in the recommendation, recruitment or solicitation of the employment of any person who was an employee of the Company on the date of the termination of Executive’s employment or at any time within the ninety (90) days prior thereto. In the event that any such person shall be employed in a position under Executive’s direct supervision within such twelve (12) month period without the Company’s express prior written permission, it shall be conclusively presumed that this restriction has been violated.

7.2.4 So long as Executive is employed by the Company and for a period of twelve (12) months thereafter Executive shall not directly or indirectly, provide any service either as an employee, employer, consultant, contractor, agent, principal, partner, substantial stockholder, corporate officer or director of or for a company or enterprise which competes in any material manner with the then present or Planned Business Activities (as defined below) of the Company, including without limitation, audio programming, production, engineering, promotion or broadcasting regardless of the method of its delivery, which methods include, without limitation, AM, FM, satellite, PCS, cable, Internet, or any other means. For purpose of the foregoing “ Planned Business Activities ” shall mean a business initiative materially discussed by the Board or which is currently under consideration by the Board or which has been approved by the Board.

7.2.5 This Section 7 shall survive termination of this Agreement.

8. Employer Property .

8.1 Any patents, inventions, discoveries, applications or processes, software and computer programs devised, planned, applied, created, discovered or invented by Executive in the course of his employment under this Agreement and which pertain to any aspect of the business of Employer or its subsidiaries, affiliates, divisions or customers, shall be the sole and absolute property of Employer and Executive shall make prompt report thereof to Employer and promptly execute any and all documents reasonably requested to assure Employer the full and complete ownership thereof.

8.2 All records, files, lists, drawings, documents, equipment and similar items relating to Employer’s business which Executive shall prepare or receive from Employer shall remain Employer’s sole and exclusive property. Upon termination of this Agreement, Executive shall return promptly to Employer all property of Employer in his possession and Executive represents that he will not copy, or cause to be copied, printed, summarized or compiled, any software, documents or other materials originating with and/or belonging to Employer. Executive further represents that he will not retain in his possession any such software, documents or other materials in machine or human readable forms. The requirements of this Section 8.2 shall not be applicable to Executive’s “rolodex” and other similar list of personal business associates and contacts at the time of termination that is not part of the Employer’s books and records (collectively, “ Executive Property ”).

8.3 This Section 8 shall survive termination of this Agreement.

9. Executive Representations and Warranties . Executive warrants and represents to and covenants with Employer as follows:

9.1 No Conflict . The execution, delivery and performance of this Agreement by Executive does not conflict with or violate any provision of or constitute a default under any agreement, judgment, award or decree to which Executive is a party or by which Executive is bound. No consent of any third party is necessary for Executive to enter into this Agreement and comply fully with his obligations hereunder. Executive is not party to or bound by any other employment agreement, non-compete agreement, confidentiality agreement or similar agreement.

9.2 Enforceable Agreement . This Agreement is the valid enforceable agreement of Executive, enforceable against him in accordance with its terms.

10. Termination . Executive’s employment hereunder may be terminated by the Board under the following circumstances:

10.1 Death . Executive’s employment hereunder shall terminate automatically upon his death.

10.2 Disability . This Agreement shall terminate on Executive’s physical or mental disability or infirmity which, in the opinion of a competent physician mutually selected in advance of such disability or infirmity by Executive and the Compensation Committee, renders Executive unable to perform his duties under this Agreement for more than one hundred twenty (120) days during any one hundred eighty (180) day period (“ Disability ”).

10.3 Cause . The Board may terminate Executive’s employment hereunder for “ Cause ” in the event of any one or more of the following (each as determined by the Board in its sole discretion), provided that, with respect to clause (ii) below, the Company provides written notice to Executive upon the occurrence of any such event, following which Executive fails to cure such event within thirty (30) days: (i) Executive has engaged in fraud, embezzlement, theft, commission of a felony or proven dishonesty in the course of his employment or service; (ii) Executive has breached any material provision of his employment or service contract with the Company, including, without limitation, any covenant against competition and/or raiding of the Company’s employees, non-employee directors or key advisors; or (iii) Executive has disclosed trade secrets or confidential information of the Company to persons not entitled to receive such information.

10.4 Good Reason . Executive may terminate this Agreement for “ Good Reason ” upon written notice to the Employer within thirty (30) days of the occurrence of any of the events set forth in Section 10.4(a) or 10.4(b) as constituting “Good Reason,” in which case the Board shall be treated as having terminated Executive’s employment hereunder without Cause.

“ Good Reason ” means:

(a) (i) the assignment to Executive of any duties inconsistent in any material respect with his position (including status, offices and titles), authority, duties or responsibilities which remains uncured thirty (30) days after receipt of notice thereof given by Executive; or (ii) any other action by Employer which results in a material diminishment in such position, authority, duties or responsibilities, and which remains uncured thirty (30) days after receipt of notice thereof given by Executive;

(b) any material breach by the Company in performing its obligations hereunder and which remains uncured thirty (30) days after receipt of notice thereof given by Executive; or

(c) following the Company’s notice to Executive of its intent to either terminate or renegotiate the terms of this Agreement that is timely given under Section 3 , the Company’s failure to, no later than thirty (30) days before the expiration of the original or any then current renewal term, offer continued employment to Executive as of the expiration of this Agreement on terms and conditions no less favorable than those provided to Executive under this Agreement. An offer of continued employment shall be deemed to be on terms and conditions no less favorable than those provided to Executive under this Agreement if it provides for a term of at least one (1) year and: (A) an annual base salary, potential bonus opportunity and severance protections no less favorable than that provided to Executive under this Agreement; and (B) incentives consistent with the Company’s past practices with respect to Executive.

10.5 Notice . Any termination of Executive’s employment by the Board shall be communicated by written Notice of Termination to Executive and any termination by Executive of his employment with Employer for “Good Reason” shall be communicated by written notice to the Employer within thirty (30) days of the occurrence of the event set forth in Section 10.4(a) or 10.4(b) which constitutes “Good Reason.” No notice shall be required in the event of the occurrence of the event set forth in Section 10.4(c) which constitutes “Good Reason.” In the event Executive or the Employer fails to provide written notice under this Section 10.5 and the other party fails to object to such failure prior to Executive’s Date of Termination, any requirement to provide written Notice of Termination under this Agreement shall be deemed waived.

10.6 “ Date of Termination ” shall mean: (i) if Executive’s employment is terminated by his death, the date of his death; (ii) if Executive’s employment is terminated by reason of his Disability, the date on which Executive is determined by a competent physician to suffer from such Disability in accordance with Section 10.2 ; (iii) if Executive’s employment is terminated pursuant to Section 10.3 or 10.4 above, the date specified in the Notice of Termination (or if no Notice of Termination is provided, the last date on which Executive renders services to Employer in the capacity of an employee); and (iv) if Executive’s employment hereunder shall be terminated by the Board for any other reason than those specified above, the effective date of written notice to Executive (or if no such written notice is provided, the last date on which Executive renders services to Employer in the capacity of an employee).

10.7 Employment At Will . Executive hereby agrees that, subject only to compliance with Employer’s obligations under Section 11 hereunder, the Board may dismiss him under this Section 10 without regard to: (i) any general or specific policies (whether written or oral) of Employer relating to the employment or termination of its employees; (ii) any statements made to Executive, whether made orally or contained in any document, pertaining to Executive’s relationship with Employer; or (iii) assignment of Cause by the Board. Inclusion under any benefit plan or compensation arrangement will not give Executive any right or claim to any benefit hereunder except to the extent such right has become fixed under the terms of this Agreement.

10.8 Termination Obligations .

10.8.1 Executive hereby acknowledges and agrees that all personal property and equipment furnished to or prepared by Executive in the course of or incident to his employment belong to Employer and shall be promptly returned to Employer upon termination of the Employment Term. “ Personal Property ” includes, without limitation, all books, manuals, records, reports, notes, contracts, customer or other lists, blueprints, and other documents, or materials, or copies thereof, whether in hard copy or in any electronic format, and all other proprietary information relating to the business of Employer or any subsidiary, affiliate or division thereof, but shall exclude Executive Property. Following termination, Executive will not retain any written or other tangible material containing any Confidential Information or other proprietary information of Employer or any subsidiary, affiliate or division thereof.

10.8.2 Upon termination of the Employment Term, Executive shall be deemed to have resigned from all offices and directorships, if any, then held with Employer or any of its direct or indirect subsidiaries or other affiliates; provided, however , that Executive shall not be deemed to have resigned from the Board.

10.8.3 The representations and warranties contained in this Section 10.8 and Executive’s obligations under Section 7 and Section 8 hereof shall survive termination of the Employment Period and the expiration or termination of this Agreement.

11. Compensation Upon Death, Termination During Disability, Other Terminations .

11.1 Death or Disability . If at any time Executive’s employment hereunder shall be terminated as a result of Executive’s death or Disability, then:

11.1.1 Employer shall pay Executive (or, if applicable, Executive’s estate): (i) the Base Compensation through the date of termination; (ii) on the sixtieth (60 ^th ) day after Executive’s termination, any Annual Bonus earned, but unpaid, as of the date of termination for the immediately preceding fiscal year, paid in accordance with Section 4.2 (except to the extent payment is otherwise deferred pursuant to any applicable deferred compensation arrangement with the Company); (iii) an amount for reimbursement, within 60 days following submission by Executive (or, if applicable, Executive’s estate) to the Company of appropriate supporting documentation) for any unreimbursed business expenses properly incurred by Executive pursuant to Section 6 and in accordance with Company policy prior to the termination date; and (iv) such employee benefits, if any, as to which Executive (or, if applicable, Executive’s estate) or his dependents may be entitled under the employee benefit plans of the Company (the amounts described in clauses (i) through (iv) hereof being referred to as the “ Accrued Rights ”);

11.1.2 Employer shall pay Executive (or, if applicable, Executive’s estate) on the sixtieth (60 ^th ) day after Executive’s termination in a single lump sum the sum of: (A) two (2) years’ Base Compensation; and (B) two (2) times the highest Annual Bonus paid to Executive during the preceding three (3) year period.

11.1.3 If Executive or Executive’s dependents elect to continue applicable health insurance coverage under COBRA following such termination, then the Company shall pay Executive’s monthly COBRA premium for continued health insurance coverage for Executive and Executive’s eligible dependents until the earlier of: (i) eighteen (18) months following the termination date; or (ii) the date upon which Executive and his eligible dependents become eligible for comparable coverage under a group health insurance plan maintained by subsequent employer.

11.1.4 All of Executive’s then outstanding stock based rights which are subject to vesting on the basis of Company performance (including without limitation the restricted stock unit grant under Section 5 ) shall become vested, exercisable and payable with respect to all of the equity subject thereto (and all options and similar rights shall remain exercisable with respect to such equity for up to an additional two (2) years from the termination date, but in no event longer than for the original term of the options).

11.2 Cause or Voluntary Termination without Good Reason . If at any time Executive’s employment hereunder shall be terminated for Cause or if Executive voluntarily terminates his employment other than for Good Reason, Employer shall pay Executive the Accrued Rights.

11.3 Other Termination . If Executive’s employment hereunder shall be terminated by Executive for Good Reason or by Employer for any reason other than for Cause, death or Disability, then:

11.3.1 Employer shall pay Executive the Accrued Rights.

11.3.2 If such termination occurs prior to the execution of a binding agreement which would result in a Change in Control if consummated or more than two years following a Change in Control, Employer shall pay Executive on the sixtieth (60 ^th ) day after Executive’s termination a single lump sum in an amount equal to the greater of :

(a) the sum of: (i) the remaining Base Compensation payable during the Employment Term; and (ii) the remaining Annual Bonus(es) (or pro-rated portion thereof) payable during the Employment Term, determined assuming the amount of each such remaining Annual Bonus is equal to the highest Annual Bonus paid to Executive during the preceding three (3) year period, and with respect to both (i) and (ii) above further determined assuming Executive’s continued employment hereunder for the remaining Employment Term but, until such time as the automatic renewal provisions of Section 3 shall become operative, without regard to the automatic renewal provisions of Section 3; or

(b) the sum of (i) two (2) years’ Base Compensation; and (ii) two (2) times the highest Annual Bonus paid to Executive during the preceding three (3) year period.

11.3.3 If such termination occurs following the execution of a binding agreement which would result in a Change in Control if consummated or prior to two years following a Change in Control, Employer shall pay Executive, on the sixtieth (60 ^th ) day after Executive’s termination, a single lump sum in an amount equal to the sum of: (i) three (3) years’ Base Compensation; and (ii) three (3) times the highest Annual Bonus paid to Executive during the preceding three (3) year period.

11.3.4 If Executive elects to continue his health insurance coverage under COBRA following such termination, then the Company shall pay Executive’s monthly COBRA premium for continued health insurance coverage for Executive and Executive’s eligible dependents until the earlier of (i) eighteen (18) months following the termination date, or (ii) the date upon which Executive and his eligible dependents become eligible for comparable coverage under a group health insurance plan maintained by subsequent employer.

11.3.5 If such termination occurs during the period commencing with the execution of a binding agreement which would result in a Change in Control if consummated and ending twenty four (24) months following the consummation of such Change in Control, all of Executive’s then-outstanding stock based rights which are subject to vesting solely on the basis of time shall become vested, exercisable and payable with respect to all of the equity subject thereto (and all options and similar rights shall remain exercisable with respect to such equity for up to an additional two (2) years from the termination date, but in no event longer than for the original term of the options). Executive’s outstanding stock options shall be amended by the Board or the Compensation Committee to the extent necessary to provide for the accelerated exercisability and extended term as provided herein.

11.3.6 All of Executive’s then-outstanding stock based rights which are subject to vesting on the basis of the Company’s performance (including without limitation the restricted stock unit grant under Section 5 ) shall become vested, exercisable and payable with respect to all of the equity subject thereto (and all options and similar rights shall remain exercisable with respect to such equity for up to an additional two (2) years from the termination date, but in no event longer than for the original term of the options).

11.4 Change in Control . For purposes of this Agreement, “ Change in Control ” shall mean any transaction or series of related transactions the consummation of which results in Executive (or Executive’s Immediate Family) holding or having a beneficial interest in shares of the Company’s capital stock having less than

fifty percent (50%) of the voting power of the Company’s outstanding capital stock; provided that any such transaction is a bona fide transaction between the Company and a third party (or parties) unrelated to Executive, as determined by the Board in good faith. For purposes of this Agreement, “ Immediate Family ” shall mean any person, trust or estate who qualifies as a “Permitted Class B Transferee” as set forth in the Company’s Articles of Incorporation.

11.5 Release of Claims . As a condition to the receipt of any benefits described hereunder subsequent to the termination of the employment of Executive (other than those payable on account of Executive’s death), Executive shall be required to execute, and not subsequently revoke, within sixty (60) days following the termination of his employment a release in a form reasonably acceptable to Employer of all claims arising out of his employment or the termination thereof including, but not limited to, any claim of discrimination under state or federal law, but excluding claims for indemnification under any agreement to which Executive is a party or pursuant to Employer’s charter or by-laws or policies of insurance maintained by Employer.

11.6 Separation from Service . Notwithstanding any provision to the contrary in the Agreement, in order to be eligible to receive any termination benefits under this Agreement that are deemed deferred compensation subject to Section 409A of the Code, the Executive’s termination of employment must constitute a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1(h) (a “ Separation from Service ”).

12. Parachute Payments .

12.1 If it is determined (as hereafter provided) that Executive would be subject to the excise tax imposed by Code Section 4999 to which Executive would not have been subject but for any payment or stock option or restricted stock vesting (collectively a “ Payment ”) occurring pursuant to the terms of this Agreement or otherwise as in connection with a change in the ownership or effective control of Employer or a change in the ownership of a substantial portion of the assets of the Employer within the meaning of Code Section 280G(b)(2)(A)(i) (such tax, a “ Parachute Tax ”), then Executive shall be entitled to receive an additional payment or payments (a “ Gross-Up Payment ”) in an amount such that, after payment by Executive of all taxes (including any Parachute Tax) imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Parachute Tax imposed upon the Payment (and taxes on such additional payments pursuant to this Section 11 ). The Gross-up Payment shall be made no later than the last day of Executive’s taxable year following the taxable year in which Executive remits any taxes under Section 4999 of the Code to the Internal Revenue Service.

12.2 Subject to the provisions of Section 12.1 hereof, all determinations required to be made under this Section 12 , including whether a Parachute Tax is payable by Executive and the amount of such Parachute Tax and whether a Gross-Up Payment is required and the amount of such Gross-Up Payment, shall be made by the nationally recognized firm of certified public accountants (the “ Accounting Firm ”) used by the Company prior to the Change in Control (or, if such Accounting Firm declines to serve, the Accounting Firm shall be a nationally recognized firm of certified public accountants selected by the Company). For purposes of making the calculations required by this Section, the Accounting Firm may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code, provided that the Accounting Firm’s determinations must be made with substantial authority (within the meaning of Section 6662 of the Code). The Accounting Firm shall be directed by the Company or Executive to submit its preliminary determination and detailed supporting calculations to both the Company and Executive within fifteen (15) calendar days after the determination date, if applicable, and any other such time or times as may be requested by the Company or Executive. If the Accounting Firm determines that any Parachute Tax is payable by Executive, the Company shall pay the required Gross-Up Payment to, or for the benefit of, Executive within five business days after receipt of such determination and calculations and in any event by no later than the last day of the taxable year of the Executive following the taxable year in which the related taxes must be remitted to the relevant taxing authorities. If the Accounting Firm determines that no Parachute Tax is payable by Executive, it shall, at the same time as it makes such determination, furnish Executive with an opinion that he has substantial authority not to report any Parachute Tax on his federal tax return. Any good faith determination by the Accounting Firm as to the amount of the Gross-Up Payment shall be binding upon the Company and Executive absent a contrary determination by the Internal Revenue Service or a court of competent jurisdiction; provided , however , that no such determination shall eliminate or reduce the Company’s obligation to provide any Gross-Up Payments that shall be due as a result of such contrary determination. As a result of the uncertainty in the application of Code Section 4999

at the time of any determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments that will not have been made by the Company should have been made (an “ Underpayment ”), consistent with the calculations required to be made hereunder. In the event of a final determination by the Internal Revenue Service that an Underpayment has occurred, Executive shall direct the Accounting Firm to determine the amount of the Underpayment that has occurred and to submit its determination and detailed supporting calculations to both the Company and Executive as promptly as possible. Any such Underpayment shall be promptly paid by the Company to, or for the benefit of, Executive within five business days after receipt of such determination and calculations. Provided, however , that in no event shall any Underpayment be made later than the last day of the taxable year of the Executive following the taxable year in which the related taxes must be remitted to the relevant taxing authorities.

12.3 The Company and Executive shall each provide the Accounting Firm access to and copies of any books, records and documents in the possession of the Company or Executive, as the case may be, reasonably requested by the Accounting Firm, and otherwise cooperate with the Accounting Firm in connection with the preparation and issuance of the determination contemplated by Section 12.2 hereof.

12.4 The federal tax returns filed by Executive (and any filing made by a consolidated tax group which includes the Company) shall be prepared and filed on a basis consistent with the determination of the Accounting Firm with respect to the Parachute Tax payable by Executive, as the same may be amended or supplemented. Executive shall make proper payment of the amount of any Parachute Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of his federal income tax return as filed with the Internal Revenue Service, and such other documents reasonably requested by the Company, evidencing such payment.

13. Legal Fees . The Company shall reimburse Executive for all professional fees and expenses related to legal, tax and financial advice obtained by Executive in connection with the negotiation and execution of this Amended and Restated Employment Agreement up to a maximum amount of $25,000.

14. Notices . All notices and other communications and legal process shall be in writing and shall be personally delivered, transmitted by telecopier, telex or cable, or transmitted by Federal Express or other reputable commercial overnight delivery service which provides evidence of delivery, as elected by the party giving such notice, addressed as follows:


If to Employer:		Entercom Communications Corp.
		401 E. City Avenue, Suite 809
		Bala Cynwyd, Pennsylvania 19004
		Attention: Secretary and General Counsel

If to Executive:		As set forth on the signature page hereto.

Notices shall be deemed to have been given: (i) on the first business day after posting, if delivered by overnight courier as described above, (ii) on the date of receipt if delivered personally, or (iii) on the next business day after transmission if transmitted by telecopier, telex or cable (and appropriate receipt of transmission is confirmed by telecopy or telephone). Any party hereto may change its address for purposes hereof by notice to the other parties hereto.

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

16. Headings . The headings herein are for convenience only, do not constitute a part of this Agreement, and shall not be deemed to limit or affect any of the provisions hereof.

17. Entire Understanding . This Agreement constitutes the entire agreement and understanding between the parties hereto with respect to the employment of Executive by Employer, and supersedes all other prior agreements, representations and understandings, both written and oral, between the parties hereto with respect to the subject matter hereof, including without limitation the Prior Agreement.

18. Amendments . This Agreement may not be modified or changed except by written instrument signed by each of the parties hereto.

19. Governing Law . This Agreement shall be governed by and construed in accordance with the internal laws of the Commonwealth of Pennsylvania, without regard to principles of conflicts of law.

20. Dispute Resolution Process . The parties hereby agree that, in order to obtain prompt and expeditious resolution of any disputes under this Agreement, each claim, dispute or controversy of whatever nature, arising out of, in connection with, or in relation to the interpretation, performance or breach of this Agreement (or any other agreement contemplated by or related to this Agreement or any other agreement between Employer and Executive), including without limitation any claim based on contract, tort or statute, or the arbitrability of any claim hereunder (a “ Claim ”), shall be settled, at the request of any party of this Agreement, by final and binding arbitration conducted in Montgomery County, Pennsylvania. All such Claims shall be settled by one arbitrator in accordance with the Commercial Arbitration Rules then in effect of the American Arbitration Association. Such arbitrator shall be provided through the CPR Institute for Dispute Resolution (“ CPR ”) by mutual agreement of the parties; provided that, absent such agreement, the arbitrator shall be appointed by CPR. In either event, such arbitrator may not have any preexisting, direct or indirect relationship with any party to the dispute. Each party hereto expressly consents to, and waives any future objection to, such forum and arbitration rules. Judgment upon any award may be entered by any state or federal court having jurisdiction thereof. Except as required by law (including, without limitation, the rules and regulations of the Securities and Exchange Commission), neither party nor the arbitrator shall disclose the existence, content, or results of any arbitration hereunder without the prior written consent of all parties.

Adherence to this dispute resolution process shall not limit the right of Employer or Executive to obtain any provisional remedy, including without limitation, injunctive or similar relief set forth in Section 29 , from any court of competent jurisdiction as may be necessary to protect their respective rights and interests pending arbitration. Notwithstanding the foregoing sentence, this dispute resolution procedure is intended to be the exclusive method of resolving any Claims arising out of or relating to this Agreement.

The arbitration procedures shall follow the substantive law of the Commonwealth of Pennsylvania, including the provisions of statutory law dealing with arbitration, as it may exist at the time of the demand for arbitration, insofar as said provisions are not in conflict with this Agreement and specifically excepting therefrom sections of any such statute dealing with discovery and sections requiring notice of the hearing date by registered or certified mail.

21. Waiver of Jury Trial . Consistent with the intention of Section 20 , each signatory to this Agreement further waives its respective right to a jury trial of any claim or cause of action arising out of this Agreement or any dealings between any of the signatories hereto relating to the subject matter of this Agreement. The scope of this waiver is intended to be all-encompassing of any and all disputes that may be filed in any court and that relate to the subject matter of this Agreement, including, without limitation, contract claims, tort claims, and all other common law and statutory claims. This waiver is irrevocable, meaning that it may not be modified either orally or in writing, and this waiver shall apply to any subsequent amendments, supplements or other modifications to this Agreement or to any other document or agreement relating to the transactions contemplated by this Agreement.

22. Construction . Whenever in this Agreement the context so requires, references to the masculine shall be deemed to include feminine and the neuter, references to the neuter shall be deemed to include the masculine and feminine, references to the plural shall be deemed to include the singular and references to the singular shall be deemed to include the plural.

23. Conflict . In the event of any conflict between the provisions of this Agreement and the policies and practices of Employer the provisions of this Agreement shall govern.

24. Cooperation . Each party hereto shall cooperate with the other party and shall take such further action and shall execute and deliver such further documents as may be necessary or desirable in order to carry out the provisions and purposes of this Agreement.

25. Waiver . No amendment or waiver of any provision of this Agreement shall in any event be effective, unless the same shall be in writing and signed by the parties hereto, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. The failure of any party to insist, in any one or more instances, upon performance of any of the terms, covenants or conditions of this Agreement shall not be construed as a waiver or relinquishment of any rights granted hereunder or any such term, covenant or condition.

26. Negotiation of Agreement . Any rule of law, or any legal decision that would require interpretation of any ambiguities in this Agreement against the party that drafted it, shall be of no application and is hereby expressly waived. The provisions of this Agreement shall be interpreted in a reasonable manner to effect the intentions of the parties and this Agreement.

27. Parties in Interest; Assignment . This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective permitted successors, assigns, heirs and/or personal representatives, except that neither this Agreement nor any interest herein shall be assigned or assignable by operation of law or otherwise, by Executive without the prior written consent of Employer, which such consent Employer may grant or withhold in its discretion. Employer may, without the consent of Executive, assign this Agreement or any interest herein, by operation of law or otherwise, to: (a) any successor to all or substantially all of its stock, assets or business by dissolution, merger, consolidation, transfer of assets, or otherwise; or (b) any direct or indirect subsidiary, affiliate or division of Employer or of any such successor referred in (a) hereof. Nothing in this Agreement, expressed or implied, is intended to confer on any person other than the parties and their respective successors and permitted assigns any rights or remedies under or by reason of this Agreement.

28. Severability . If any provision of this Agreement shall be deemed invalid, unenforceable or illegal, then notwithstanding such invalidity, unenforceability or illegality, the remainder of this Agreement shall continue in full force and effect.

29. Injunctive Relief . In the event of breach by Executive of the terms of Section 7 or Section 8 , Employer shall be entitled to enforce the specific performance of this Agreement by Executive and to enjoin Executive from any further violation of either such provisions and to exercise such remedies cumulatively or in conjunction with all other rights and remedies provided by law.

30. Section 409A .

30.1 Notwithstanding anything herein to the contrary, if the Executive is deemed at the time of his termination of employment with the Company to be a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code, then to the extent delayed commencement of any portion of the termination benefits to which Executive is entitled under this Agreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, such portion of Executive’s termination benefits shall not be provided to Executive prior to the earlier of: (i) the expiration of the six-month period measured from the date of the Executive’s Separation from Service with the Company; or (ii) the date of Executive’s death. Upon the earlier of such dates, all payments deferred pursuant to this Section 30.1 shall be paid in a lump sum to the Executive, and any remaining payments due under the Agreement shall be paid as otherwise provided herein. The determination of whether the Executive is a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code as of the time of his separation from service shall made by the Company in accordance with the terms of Section 409A of the Code and applicable guidance thereunder (including without limitation Treas. Reg. Section 1.409A-1(i) and any successor provision thereto). Notwithstanding the foregoing or any other provisions of this Agreement, the Company and Executive agree that, for purposes of the limitations on nonqualified deferred compensation under Section 409A of the Code, each payment of compensation under this Agreement shall be treated as a right to receive a series separate and distinct payments of compensation for purposes of applying the Section 409A of the Code.

30.2 The Company and Executive acknowledge and agree that, to the extent applicable, this Agreement shall be interpreted in accordance with, and the parties agree to use their best efforts to achieve timely compliance with, Section 409A of the Code and the Department of Treasury Regulations and other interpretive guidance issued thereunder (“ Section 409A ”), including without limitation any such regulations or other guidance that may be issued after the Effective Date.

(Signature page follows)

31. Executive Acknowledgement . Executive represents and agrees that he fully understands his right to discuss all aspects of this Agreement with his private attorney, and that to the extent, if any, that he desired, he availed himself of such right. Executive further represents that he has carefully read and fully understands all of the provisions of this Agreement, that he is competent to execute this Agreement, that his agreement to execute this Agreement has not been obtained by any duress and that he freely and voluntarily enters into it, and that he has read this document in its entirety and fully understands the meaning, intent and consequences of this document.

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


“EXECUTIVE”

/DAVID J. FIELD/		4/22/16
David J. Field		Date

Address for Notice:

401 E. City Avenue Suite 809 Bala Cynwyd, PA 19004

“EMPLOYER”

Entercom Communications Corp., a Pennsylvania corporation

By:	/ANDREW P. SUTOR, IV/	4/22/16
	Andrew P. Sutor, IV	Date
	Senior Vice President
	and Secretary

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) and 15d-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: August 5, 2016


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

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: August 5, 2016


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

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 June 30, 2016 (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: August 5, 2016


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.

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: August 5, 2016


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