-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SQwzJzLnDAkS5C69WKcbZqgaOSRkJCu9LszNi+3fRM316hZP6njxrhFXq/frTmlu x46yfQ92DUvtKDbVcWqqjg== 0000912057-96-021052.txt : 19960926 0000912057-96-021052.hdr.sgml : 19960926 ACCESSION NUMBER: 0000912057-96-021052 CONFORMED SUBMISSION TYPE: 424B2 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19960925 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: JACOR COMMUNICATIONS INC CENTRAL INDEX KEY: 0000702808 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 310978313 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B2 SEC ACT: 1933 Act SEC FILE NUMBER: 333-06639 FILM NUMBER: 96634024 BUSINESS ADDRESS: STREET 1: 1300 PNC CENTER STREET 2: 201 E FIFTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5136211300 424B2 1 424B2 PROSPECTUS JACOR COMMUNICATIONS, INC. 4,400,000 SHARES OF COMMON STOCK AND 11,335,824 WARRANTS TO PURCHASE COMMON STOCK AND 2,307,120.18 SHARES OF COMMON STOCK UNDERLYING SUCH WARRANTS This Prospectus relates to the issuance of 4,400,000 shares of common stock, $.01 par value (the "Common Stock"), of Jacor Communications, Inc., a Delaware corporation ("Jacor"), issuable upon the exercise of common stock purchase warrants (the "Warrants") issued to shareholders of Citicasters Inc., a Florida corporation ("Citicasters"), in the merger (the "Merger") of JCAC, Inc., a Florida corporation ("JCAC") and wholly-owned subsidiary of Jacor, with and into Citicasters, pursuant to the Agreement and Plan of Merger dated as of February 12, 1996 by and among Jacor, JCAC and Citicasters (the "Merger Agreement"). The Warrants were issued by Jacor's predecessor corporation prior to Jacor's reincorporation from Ohio to Delaware effective September 18, 1996. Unless otherwise indicated, all references to "Jacor" refer to Jacor Communications, Inc., a Delaware corporation, Jacor Communications, Inc., an Ohio corporation, and any subsidiaries thereof. This Prospectus also relates to the sale by certain shareholders of Citicasters (the "Selling Security Holders") of the 11,335,824 Warrants issued to the Selling Security Holders in the Merger and the sale by the Selling Security Holders of the 2,307,120.18 shares of Common Stock issuable to the Selling Security Holders upon the exercise of the Warrants issued to them. The Selling Security Holders' Warrants and shares of Common Stock covered hereunder may be offered for sale from time to time by the Selling Security Holders. See "Selling Security Holders" and "Plan of Distribution." The Warrants are listed on the Nasdaq National Market under the symbol "JCORZ" and the Common Stock is listed on the Nasdaq National Market under the symbol "JCOR." Pursuant to the Merger Agreement, Citicasters shareholders received, in exchange for each issued and outstanding share of Citicasters common stock, (i) $29.50 in cash (the "Cash Consideration"); plus (ii) a Warrant to acquire .2035247 of a share of Common Stock (the "Warrant Consideration", and together with the Cash Consideration, the "Merger Consideration"). The Warrants have an exercise price of $28.00 per full share of Common Stock. The exercise price was determined in arms-length negotiations between Jacor and Citicasters. At the time of the exercise of any Warrant the holder of such Warrant will receive, in lieu of any fractional share of Common Stock, an amount in cash equal to the closing price for one share of Common Stock on the trading day immediately preceding the date the Warrant is presented for exercise, multiplied by such fraction. Based on the number of shares of Citicasters common stock outstanding at the close of business on the effective date of the Merger (the "Effective Time"), the total number of Warrants that will be outstanding as a result of the Merger is 21,618,990.5. SEE "RISK FACTORS" AT PAGE 4 FOR CERTAIN INFORMATION THAT SHOULD BE CONSIDERED BY THE SHAREHOLDERS. ------------------------------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. -------------------------------- Pursuant to agreements with the Selling Security Holders, Jacor has agreed to pay the costs, fees and expenses incurred in connection with the registration of the Warrants and the shares of Common Stock being sold by the Selling Security Holders; provided, however, that Jacor will not pay any fees and expenses of counsel to, or any other persons retained by, any holder of Registrable Securities (as defined herein), and any discounts, commissions, underwriting or advisory fees, brokers' fees or fees of similar securities industry professionals relating to the distribution of the Registrable Securities. The date of this Prospectus is September 24, 1996. 1 AVAILABLE INFORMATION Jacor is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and accordingly files reports, proxy statements and other information with the Commission. Such reports, proxy statements and other information filed with the Commission are available for inspection and copying at the public reference facilities maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices located at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and at 7 World Trade Center, 13th Floor, New York, New York 10048. Copies of such documents may also be obtained from the Public Reference Room of the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Jacor files its reports, proxy statements and other information with the Commission electronically, and the Commission maintains a Web site located at http://www.sec.gov containing such information. This Prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. The Registration Statement, including any amendments, schedules and exhibits thereto, is available for inspection and copying as set forth above. Statements contained in this Prospectus as to the contents of any contract or other document referred to herein include all material terms of such contracts or other documents but are not necessarily complete, and in each instance reference is made to the copy of such contract or other document filed as an exhibit to the Registration Statement, each such statement being qualified in all respects by such reference. The Common Stock is traded on the Nasdaq National Market. The Warrants are also listed on the Nasdaq National Market. Reports and other information concerning Jacor are available for inspection and copying at the offices of The Nasdaq Stock Market at 1735 K Street, N.W., Washington, D.C. 20006-1506. 2 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents previously filed by Jacor and its wholly-owned subsidiaries with the Commission under the Exchange Act are incorporated herein by reference: (a) Annual Report on Form 10-K for the fiscal year ended December 31, 1995, as amended; (b) Quarterly Reports on Form 10-Q for the quarters ended March 31, 1996 and June 30, 1996; (c) Current Reports on Form 8-K dated February 14, 1996, February 27, 1996, March 6, 1996, as amended, March 27, 1996, as amended, and July 30, 1996; (d) Form 8-B Registration Statement dated September 23, 1996; (e) Citicasters' Annual Report on Form 10-K for the year ended December 31, 1995, as amended; (f) Citicasters' Quarterly Reports on Form 10-Q for the quarters ended March 31, 1996, as amended, and June 30, 1996; (g) Citicasters' Current Report on Form 8-K dated February 14, 1996; and (h) Citicasters' Form 8-B Registration Statement dated September 23, 1996. All documents filed by Jacor pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus shall be deemed to be incorporated by reference into this Prospectus and to be a part hereof from the date of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes hereof to the extent that a statement contained herein (or in any other subsequently filed document that is or is deemed to be incorporated by reference herein) modifies or supersedes such previous statement. Any statement so modified or superseded shall not be deemed to constitute a part hereof except as so modified or superseded. THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS (OTHER THAN EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE HEREIN) ARE AVAILABLE, WITHOUT CHARGE, UPON ORAL OR WRITTEN REQUEST BY ANY PERSON TO WHOM THIS PROSPECTUS HAS BEEN DELIVERED. SUCH REQUEST SHOULD BE DIRECTED TO JON M. BERRY, SENIOR VICE PRESIDENT AND TREASURER, JACOR COMMUNICATIONS, INC., 1300 PNC CENTER, 201 EAST FIFTH STREET, CINCINNATI, OHIO 45202, TELEPHONE NUMBER (513) 621-1300. 3 RISK FACTORS RISKS OF ACQUISITION STRATEGY. Jacor intends to pursue growth through the opportunistic acquisition of broadcasting companies, radio station groups and individual radio stations. In this regard, Jacor routinely reviews such acquisition opportunities. Jacor believes that currently there are available a number of acquisition opportunities that would be complementary to its business. Jacor cannot predict whether it will be successful in pursuing such acquisition opportunities or what the consequences of any such acquisition would be. The receipt of certain federal and state governmental or regulatory approvals are required in order to consummate the acquisitions, including approvals or waivers from the Federal Communications Commission (the "FCC"), and, if certain criteria are met, the expiration of or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, as enforced by the Antitrust Division of the Department of Justice. With regard to each proposed acquisition, Jacor will use its reasonable best efforts to obtain such approvals or waivers, but there can be no assurance as to when or if such approvals or waivers will be obtained such that the acquisitions may be consummated. Jacor's acquisition strategy involves numerous risks, including difficulties in the integration of operations and systems, the diversion of management's attention from other business concerns and the potential loss of key employees of acquired stations. There can be no assurance that Jacor's management will be able to manage effectively the resulting business or that such acquisitions will benefit Jacor. Future acquisitions also may involve the expenditure of significant funds. Depending on the nature, size and timing of future acquisitions, Jacor may be required to raise additional financing. There is no assurance that such additional financing will be available to Jacor on acceptable terms. GOVERNMENTAL REGULATION OF BROADCASTING INDUSTRY. The broadcasting industry is subject to extensive federal regulation which, among other things, requires approval by the FCC for the issuance, renewal, transfer, and assignment of broadcasting station operating licenses and limits the number of broadcasting properties Jacor may acquire. Additionally, in certain circumstances, the Communications Act of 1934, as amended (the "Communications Act"), and FCC rules will operate to impose limitations on alien ownership and voting of the capital stock of Jacor. Certain provisions of the Telecommunications Act of 1996 (the "Telecom Act"), which became law on February 8, 1996, will be acted upon by the FCC through rulemaking proceedings, presently scheduled for completion by the end of 1996. The effects of the Telecom Act on the broadcasting industry and thus on Jacor's business are uncertain, 4 and there can be no assurance that the Telecom Act will not negatively impact Jacor's operations in the future. Jacor's business is dependent upon maintaining its broadcast licenses issued by the FCC, which are issued for maximum terms of eight years. Although it is rare for the FCC to deny a renewal application, there can be no assurance that the future renewal applications will be approved, or that such renewals will not include conditions or qualifications that could adversely affect Jacor's operations. Moreover, governmental regulations and policies may change over time and there can be no assurance that such changes would not have a material adverse impact upon Jacor's business, financial condition and results of operations. COMPETITION; BUSINESS RISKS. Broadcasting is a highly competitive business. Jacor's radio and television stations compete for audiences and advertising revenues directly with other radio and television stations, as well as with other media, such as newspapers, magazines, cable television, outdoor advertising, and direct mail, within their respective markets. Audience ratings and market shares are subject to change and any adverse change in a particular market could have a material and adverse effect on the revenue of stations located in that market. Future operations are further subject to many variables which could have an adverse effect upon Jacor's financial performance. These variables include economic conditions, both generally and relative to the broadcasting industry; shifts in population and other demographics; the level of competition for advertising dollars with other radio stations, television stations, and other entertainment and communications media; fluctuations in operating costs; technological changes and innovations; changes in labor conditions; and changes in governmental regulations and policies and actions of federal regulatory bodies, including the FCC. Although Jacor believes that each of its stations is able to compete effectively in its respective market, there can be no assurance that any such stations will be able to maintain or increase its current audience ratings and advertising revenues. SUBSTANTIAL LEVERAGE AND LIMITED FINANCIAL FLEXIBILITY. Jacor's outstanding indebtedness may have the following important consequences: (i) significant interest expense and principal repayment obligations resulting in substantial annual fixed charges; (ii) significant limitations on Jacor's ability to obtain additional debt financing; and (iii) increased vulnerability to adverse general economic and industry conditions. In addition, Jacor's existing and anticipated credit facilities have or will have a number of financial covenants, including interest coverage, debt service coverage and a maximum ratio of debt to earnings before other expense (income), interest expense, taxes, depreciation and amortization. SHARE OWNERSHIP BY ZELL/CHILMARK. Zell/Chilmark Fund L.P. ("Zell/Chilmark") holds approximately 13,349,720 shares of the outstanding Common Stock and is Jacor's largest shareholder as of the date hereof. The large share 5 ownership of Zell/Chilmark may have the effect of discouraging certain types of transactions involving an actual or potential change of control of Jacor, including transactions in which the holders of Common Stock might otherwise receive a premium for their shares over then-current market prices. Subject to certain restrictions under the Securities Act of 1933, as amended (the "Securities Act"), and under an agreement with the underwriters for the stock offering conducted in June 1996 (the "1996 Stock Offering") restricting the sale of shares of Common Stock by Zell/Chilmark for a period of 180 days after the commencement date of the 1996 Stock Offering, Zell/Chilmark is free to sell shares of Common Stock from time to time for any reason. By virtue of its current control of Jacor, Zell/Chilmark could sell large amounts of Common Stock by causing Jacor to file a registration statement with respect to such stock. In addition, Zell/Chilmark could sell its shares of Common Stock without registration pursuant to Rule 144 under the Securities Act. Jacor can make no prediction as to the effect, if any, that such sales of shares of Common Stock would have on the prevailing market price. Sales of substantial amounts of Common Stock, or the availability of such shares for sale, could adversely affect prevailing market prices. Sales or transfers of Common Stock by Zell/Chilmark could result in another person or entity becoming the controlling shareholder of Jacor. LACK OF DIVIDENDS; RESTRICTIONS ON PAYMENTS OF DIVIDENDS. Jacor has not paid any dividends to its shareholders. Jacor intends to retain all available earnings, if any, generated by its operations for the development and growth of its business and does not anticipate paying any dividends on Common Stock in the foreseeable future. In addition, the payment of dividends on the Common Stock is restricted under Jacor's credit facilities. KEY PERSONNEL. Jacor's business is dependent upon the performance of certain key employees, including its Chief Executive Officer and President. Jacor employs several on-air personalities with significant loyal audiences in their respective markets. Jacor generally enters into long-term employment agreements with its key on-air talent to protect its interests in those relationships, but there can be no assurances that all such on-air personalities will remain with Jacor. POTENTIAL NEGATIVE IMPACT OF OTHER SECURITIES ISSUANCES. Jacor has authorized for issuance up to 4,000,000 shares of undesignated preferred stock. The Jacor Board of Directors has the authority, without further vote or action by Jacor shareholders, to issue the undesignated shares of Jacor preferred stock in one or more series and to fix all rights, qualifications, preferences, privileges, limitations and restrictions of each such series, including dividend rights, voting rights, terms of redemption, redemption prices, liquidation preferences and the number of shares constituting any series or the designation of such series. Although it currently has no plans to do so, the Jacor Board of 6 Directors, without shareholder approval, can issue Jacor preferred stock with voting and conversion rights which would adversely affect the voting power of the holders of Common Stock. In addition, the issuance of Jacor preferred stock may have the effect of delaying, deferring or preventing a change in control of Jacor and could therefore have a negative impact on the trading price of the Common Stock. Jacor may also issue other types of securities in the future that may have the same or similar negative effects as the undesignated preferred stock. See "DESCRIPTION OF CAPITAL STOCK." FORWARD-LOOKING STATEMENTS. This Prospectus contains forward-looking statements within the meaning of Section 27A of the Securities Act. Discussions containing such forward-looking statements may be found in the material set forth under "BUSINESS OF JACOR," as well as within the Prospectus generally. In addition, when used in this Prospectus, the words "believes," "anticipates," "expects" and similar expressions are intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially from those described in the forward-looking statements as a result of the risk factors set forth above and the matters set forth in the Prospectus generally. Jacor undertakes no obligation to publicly release the result of any revisions to these forward- looking statements that may be made to reflect any future events or circumstances. Jacor cautions the reader, however, that this list of risk factors may not be exhaustive. BUSINESS OF JACOR GENERAL Jacor is a holding company engaged primarily in the radio broadcasting business. Jacor's principal executive offices are located at 1300 PNC Center, 201 East Fifth Street, Cincinnati, Ohio 45202 and its telephone number is (513) 621-1300. RECENT DEVELOPMENTS In September 1996, Jacor consummated the Merger with Citicasters which owned and/or operated 19 radio stations and two television stations. The Merger enhanced Jacor's existing station portfolios in Atlanta, Tampa and Cincinnati and created new multiple station platforms in Phoenix, Portland, Kansas City, Sacramento and Columbus. In accordance with the terms of the Merger, Citicasters became a wholly-owned subsidiary of Jacor and all of the subsidiaries of Jacor prior to the Merger became subsidiaries of Citicasters upon the consummation of the Merger. Jacor drew upon the June 1996 Credit Facility (as defined herein) to fund a portion of the Cash Consideration and Jacor used the proceeds of the 1996 Stock Offering, the Notes Offering, and the LYONs Offering (each as defined herein) as part of the financing for the Merger. See "DESCRIPTION OF INDEBTEDNESS -- June 1996 7 Credit Facility," "-- 10 1/8% Senior Subordinated Notes," and "-- Liquid Yield Option-TM- Notes." In July 1996, Jacor consummated the acquisition of Noble Broadcast Group, Inc. which owned 10 radio stations serving Denver, St. Louis and Toledo. Jacor also acquired the right to provide programming to and sell the air time for one AM and one FM station serving the San Diego market. The Noble acquisition enhanced Jacor's existing portfolio in Denver where it now owns eight stations, in addition to creating new multiple station platforms in St. Louis and Toledo, where Jacor now owns two of the four Class B FM stations. In August 1996, Jacor consummated the acquisition of the FCC licenses of WLAP-AM, WMXL-FM and WWYC-FM in Lexington, Kentucky. In June 1996, Jacor consummated the acquisition of the FCC licenses of WCTQ-FM and WAMR-AM in Venice, Florida. Jacor also purchased certain real estate and transmission facilities necessary to operate the stations. The aggregate purchase price for these asset transactions was approximately $18.4 million. In July 1996 Jacor entered into an agreement to acquire the FCC licenses of WSPB-AM, WSRZ-FM and WYNF-FM in Sarasota, Florida. In May 1996, Jacor entered into an agreement to acquire the FCC licenses of WIOT-FM and WCWA-AM in Toledo, Ohio. Jacor will also purchase certain real estate and transmission facilities necessary to operate these stations. The aggregate purchase price for these asset transactions will be approximately $25.5 million, although there can be no assurances that such acquisitions will be completed. Jacor is continuing to negotiate acquisitions for additional radio stations in its existing markets and in new markets. There can be no assurance that Jacor will successfully complete any such acquisitions or what the consequences thereof would be. Additional information concerning Jacor is incorporated by reference in this Prospectus. See "AVAILABLE INFORMATION" and "INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE." USE OF PROCEEDS Jacor does not currently have specific plans for the use of the net proceeds which may be received from time to time from the sale of shares of Common Stock pursuant to the exercise of Warrants. However, Jacor currently anticipates that any such net proceeds would be used for general corporate purposes, which may include but are not limited to working capital, capital expenditures, repayment of indebtedness and acquisitions. Pending the application of the net proceeds, Jacor expects to invest such proceeds in short-term, interest-bearing instruments or other investment-grade securities. Jacor will not receive any proceeds from the sale of Warrants and/or shares of Common Stock by the Selling Security Holders. 8 SELLING SECURITY HOLDERS Jacor and the Selling Security Holders (all of whom are named in the following table) are parties to a Registration Rights Agreement dated as of August 5, 1996 (the "Registration Rights Agreement"), other than for Mr. Zanotti, pursuant to which Jacor granted certain registration rights to the Selling Security Holders and any of their stockholders, partners or affiliates to whom they may transfer the Warrants or the Common Stock issued upon the exercise of such Warrants (collectively the "Registrable Securities"). The registration rights granted by Jacor include demand registration rights if Selling Security Holders who in the aggregate hold at least fifty percent of the Registrable Securities provide a written request to Jacor. Pursuant to the Registration Rights Agreement, Jacor agreed to file with the Securities and Exchange Commission a Registration Statement under the Securities Act and maintain its effectiveness for three years. Under the terms of the Registration Rights Agreement, Jacor has agreed to pay the costs, fees and expenses incurred in connection with the registration of the Warrants and the shares of Common Stock being sold by the Selling Security Holders; provided, however, that Jacor will not pay any fees and expenses of counsel to, or any other persons retained by, any holder of Registrable Securities, and any discounts, commissions, underwriting or advisory fees, brokers' fees or fees of similar securities industry professionals relating to the distribution of the Registrable Securities. Jacor has agreed to indemnify the Selling Security Holders and any underwriters against certain liabilities, including liabilities under the Securities Act. The following table sets forth certain information with respect to the Selling Security Holders and their beneficial ownership of Common Stock as of the Effective Time of the Merger. Prior to the Effective Time of the Merger, no Selling Security Holders held any positions or offices or had any other material relationships with Jacor, or any of its predecessors or affiliates, during the past three years.
Beneficial Approximate Ownership Number of Number of Percentage Prior to Warrants Shares of Shares Name Offering(1) Offered Offered Owned - ---- ---------- ---------- ------------ ----------- Great American Insurance Company(2) 3,455,698 3,455,698 703,319.90 2.2% American Financial Corporation(2) 1,500,000 1,500,000 305,287.10 * American Financial Enterprises, Inc.(2) 2,562,697 2,562,697 521,572.14 1.6% Carl H. Lindner(2) 2,935,801 2,935,801 597,508.02 1.9% The Carl H. Lindner Foundation(2) 170,253 170,253 34,650.69 * S. Craig Lindner(2) 81,500 81,500 16,587.26 * John P. Zanotti(2) 611,875 611,875 124,531.67 * Keith E. Lindner(2) 18,000 18,000 3,663.44 * ---------- ---------- ------------ ---- Total 11,335,824 11,335,824 2,307,120.18 6.9% ---------- ---------- ------------ ---- ---------- ---------- ------------ ---- * Less than 1%.
- ------------------- (1) The Securities and Exchange Commission (the "Commission") has defined beneficial ownership to include sole or shared voting or investment power with respect to a security or the right to acquire beneficial ownership of 9 a security within 60 days. The number of shares indicated are owned with sole voting and investment power unless otherwise noted. Under rules promulgated by the Commission, any securities not outstanding that are subject to options or warrants exercisable within 60 days are deemed to be outstanding for the purpose of computing the percentage of outstanding securities of the class owned by such person but are not deemed to be outstanding for the purpose of computing the percentage of the class owned by any other person. (2) The address for Great American Insurance Company is 580 Walnut Street, Cincinnati, Ohio 45202. The address for American Financial Corporation, American Financial Enterprises, Inc., Carl H. Lindner, The Carl H. Lindner Foundation, S. Craig Lindner, John P. Zanotti and Keith E. Lindner is One East Fourth Street, Cincinnati, Ohio 45202. Because the Selling Security Holders may sell all or part of their Warrants and/or shares of Common Stock offered hereby, no estimate can be given as to the number of Warrants and shares of Common Stock that will be held by any Selling Security Holders upon termination of any offering made hereby. DESCRIPTION OF CAPITAL STOCK The authorized capital stock of Jacor consists of 100,000,000 shares of Common Stock, $.01 par value and 2,000,000 shares of Class A Preferred Stock, $.01 par value and 2,000,000 shares of Class B Preferred Stock, $.01 par value. As of September 12, 1996, 31,242,758 shares of Common Stock were issued and outstanding. COMMON STOCK The holders of Common Stock have no preemptive rights, cumulative voting rights, redemption rights, or conversion privileges. The holders of Common Stock are entitled to one vote for each share held on any matter submitted to the shareholders. All corporate action requiring shareholder approval, unless otherwise required by law, Jacor's Certificate of Incorporation or its Bylaws, must be authorized by a majority of the votes cast. Under Delaware law, approval by a majority vote of the outstanding voting shares is required to effect (i) an amendment to Jacor's Certificate of Incorporation or its Bylaws, (ii) a merger or consolidation of Jacor, and (iii) a disposition of all or substantially all of Jacor's assets. In the event of liquidation, each share of Common Stock will be entitled to share ratably in the distribution of remaining assets after payment of all debts, subject to the prior rights in liquidation of any shares of preferred stock issued. Holders of shares of Common Stock will be entitled to share ratably in such dividends as Jacor's Board, in its discretion, may validly declare from funds legally available therefor, subject to the prior rights of holders of shares of Jacor's preferred stock as may be 10 outstanding from time to time. Certain restrictions on the payment of dividends are imposed under Jacor's credit facility. CLASS A AND CLASS B PREFERRED STOCK Jacor has authorized 2,000,000 shares of Class A Preferred Stock and 2,000,000 shares of Class B Preferred Stock. It is not currently anticipated that any such shares will be issued. The Class A Preferred Stock will have full voting rights. The Class B Preferred Stock will have no voting rights except as otherwise provided by law or as lawfully fixed by Jacor's Board with respect to a particular series. Under applicable law, Jacor's Board could elect to provide the Class B Preferred Stock with limited or no voting rights. Jacor's Certificate of Incorporation authorizes Jacor's Board to provide from time to time for the issuance of the shares of Preferred Stock in series by adopting an amendment to the Certificate and to establish the terms of each such series, including (i) the number of shares of the series and the designation thereof; (ii) the rights in respect of dividends on the shares; (iii) liquidation rights; (iv) redemption rights; (v) the terms of any purchase, retirement or sinking fund to be provided for the shares of the series; (vi) terms of conversion, if any; (vii) restrictions, limitations and conditions, if any, on issuance of indebtedness of Jacor; and (viii) any other preferences and other rights and limitations not inconsistent with law, the Certificate of Incorporation, or any resolution of Jacor's Board. WARRANTS GENERAL. The Warrants were issued under the Warrant Agreement between Jacor and KeyCorp Shareholder Services, Inc. (the "Warrant Agent") dated as of September 18, 1996 (the "Warrant Agreement"). The description of the Warrant Agreement set forth below includes all material elements of the Warrant Agreement but does not purport to be complete and is qualified in its entirety by reference to the Warrant Agreement which is incorporated by reference herein. See "Available Information." Each Warrant initially entitles the holder thereof to purchase .2035247 of a share of Common Stock at a price of $28.00 per full share of Common Stock (the "Warrant Price"). The Warrant Price and the number of shares of Common Stock issuable upon the exercise of each Warrant are subject to adjustment in certain events described below. Each Warrant may be exercised on or after the issuance thereof and until 5:00 pm., Eastern Time, on September 18, 2001 (the "Expiration Date") in accordance with the terms of the Warrants and the Warrant Agreement. To the extent that any Warrant remains outstanding after such time, such unexercised Warrant will automatically terminate. EXERCISE. Warrants may be exercised by surrendering to the Warrant Agent a signed Warrant certificate together with the form 11 of election to purchase on the reverse thereof indicating the warrant holder's election to exercise all or a portion of the Warrants evidenced by such certificate. Surrendered certificates must be accompanied by payment of the aggregate Warrant Price in respect of the Warrants to be exercised, which payment may be made in cash or by certified or bank cashier's check drawn on a banking institution chartered by the government of the United States or any state thereof payable to the order of Jacor. No adjustments as to cash dividends with respect to the Common Stock will be made upon any exercise of Warrants. If fewer than all the Warrants evidenced by any certificate are exercised, the Warrant Agent will deliver to the exercising warrant holder a new Warrant certificate representing the unexercised Warrants. Jacor will not be required to issue fractional shares of Common Stock upon exercise of any Warrant and in lieu thereof will pay in cash an amount equal to the closing price per share of Common Stock on the trading day immediately preceding the date the Warrant is presented for exercise, multiplied by such fraction. Jacor has reserved for issuance a number of shares of Common Stock sufficient to provide for the exercise of the rights of purchase represented by the Warrants. A Warrant may not be exercised in whole or in part if in the reasonable opinion of counsel to Jacor the issuance of Common Stock upon such exercise would cause Jacor to be in violation of the Communications Act or the rules and regulations in effect thereunder. ANTIDILUTION AND EXERCISE PRICE ADJUSTMENTS. The number of shares of Common Stock purchasable upon the exercise of each Warrant and the Warrant Price are subject to adjustment in connection with (i) the issuance of a stock dividend to holders of Common Stock, a combination or subdivision or issuance by reclassification of Common Stock; (ii) the issuance of rights, options or warrants to all holders of Common Stock without charge to such holders to subscribe for or purchase shares of Common Stock at a price per share which is lower than the current market price; and (iii) certain distributions by Jacor to the holders of Common Stock of evidences of indebtedness or of its assets (excluding cash dividends or distributions out of earnings or out of surplus legally available for dividends) or of convertible securities, all as set forth in the Warrant Agreement. Notwithstanding the foregoing, no adjustment in the number of Warrant Shares (as defined in the Warrant Agreement) will be required until such adjustment would require an increase or decrease of at least one percent (1%) in the number of Warrant Shares purchasable upon the exercise of each Warrant. In addition, Jacor may at its option reduce the Warrant Price to any amount deemed appropriate by Jacor's Board. In case of any consolidation or merger of Jacor with or into another corporation, or any sale, transfer or lease to another 12 corporation of all or substantially all the property of Jacor, the Warrant Agreement requires that effective provisions will be made so that each holder of an outstanding Warrant will have the right thereafter to exercise the Warrant for the kind and amount of securities and property receivable in connection with such consolidation, merger, sale, transfer or lease by a holder of the number of shares of Common Stock for which such Warrant was exercisable immediately prior thereto. The reincorporation of Jacor from Ohio to Delaware effective September 18, 1996 constituted a merger under the Warrant Agreement and the successor corporation expressly assumed all of the predecessor corporation's obligations under the Warrant Agreement. MODIFICATION OF WARRANT AGREEMENT. The Warrant Agreement may be amended or supplemented without the consent of the holders of Warrants to cure any ambiguity or to correct or supplement any defective or inconsistent provision contained therein, or to make such other necessary or desirable changes which shall not adversely affect the interests of the warrant holders. Any other amendment to the Warrant Agreement requires the consent of warrant holders representing not less than 50% of the Warrants then outstanding provided that no change in the number or nature of the securities, purchasable upon the exercise of any Warrant, or the Warrant Price therefor, or the acceleration of the Expiration Date, and no change in the antidilution provisions which would adversely affect the interests of the holders of Warrants, may be made without the consent of the holder of such Warrant, other than such changes as are specifically prescribed by the Warrant Agreement or are made in compliance with applicable law. FORM AND DENOMINATIONS. The certificates representing the Warrants are in registered form. Any Warrant certificate may be transferred, split up, combined or exchanged for another Warrant certificate or certificates entitling the holder thereof to purchase a like number of shares of Common Stock on the same terms as the Warrant certificate or certificates surrendered. OFFICE FOR PRESENTATION. Warrants may be presented upon exercise, or for registration of transfer or exchange, at the office of the Warrant Agent maintained for such purpose, which office is currently located at 4900 Tiedeman Road, Cleveland, Ohio 44144. CERTAIN TAXES. Jacor will bear the cost of all documentary stamp taxes payable in connection with the initial issuance of Warrant Shares upon the exercise of Warrants, but will not be responsible for the payment of any such taxes in respect of any transfer involved in the issue or delivery of any Warrants or certificates for Warrant Shares in the name other than that of the registered holder of Warrants in respect of which such Warrant Shares are issued. 13 MISCELLANEOUS. No holder of Warrants shall be entitled to vote or receive dividends or be deemed for any purpose the holder of Common Stock until such Warrants are properly exercised as provided in the Warrant Agreement. DESCRIPTION OF INDEBTEDNESS JUNE 1996 CREDIT FACILITY JCAC entered into a new credit facility on June 12, 1996 (the "June 1996 Credit Facility") with a syndicate of banks and other financial institutions. Upon the consummation of the Merger, the June 1996 Credit Facility became an obligation of Citicasters. The June 1996 Credit Facility provides availability of up to $600.0 million of loans to Citicasters in three components: (i) a revolving credit facility of up to $200.0 million with mandatory semi-annual commitment reductions beginning on the third anniversary of the closing of the June 1996 Credit Facility and a final maturity date of seven years after initial funding; (ii) a term loan of up to $300.0 million with scheduled semi-annual reductions beginning on the second anniversary of the closing of the June 1996 Credit Facility and a final maturity date of seven years after initial funding; and (iii) a tranche B term loan of up to $100.0 million with scheduled semi- annual reductions beginning on the third anniversary of the closing of the June 1996 Credit Facility and a final maturity date of eight years after initial funding. Borrowings under the June 1996 Credit Facility bear interest at rates that fluctuate with a bank base rate and/or the Eurodollar rate. Loans under the June 1996 Credit Facility are guaranteed by Jacor and by Citicasters' direct and indirect subsidiaries other than certain immaterial subsidiaries. Citicasters' obligations with respect to the June 1996 Credit Facility and each guarantor's obligations with respect to the related guaranty are secured by substantially all of their respective assets, including, without limitation, inventory, equipment, accounts receivable, intercompany debt and, in the case of Jacor's subsidiaries, capital stock. Citicasters' obligations under the June 1996 Credit Facility are secured by a first priority lien on the capital stock of Jacor's subsidiaries. The June 1996 Credit Facility contains covenants and provisions that restrict, among other things, Citicasters' ability to: (i) incur additional indebtedness; (ii) incur liens on its property; (iii) make investments and advances; (iv) enter into guarantees and other contingent obligations; (v) merge or consolidate with or acquire another person or engage in other fundamental changes; (vi) engage in certain sales of assets; (vii) make capital expenditures; (viii) enter into leases; 14 (ix) engage in certain transactions with affiliates; and (x) make restricted junior payments. The June 1996 Credit Facility also requires the satisfaction of certain financial performance criteria (including a consolidated interest coverage ratio, a leverage-to-operating cash flow ratio and a consolidated operating cash flow available for fixed charges ratio) and the repayment of loans under the June 1996 Credit Facility with proceeds of certain sales of assets and debt issuances, and with 50% of the Company's Consolidated Excess Cash Flow (as defined in the June 1996 Credit Facility). Events of default under the June 1996 Credit Facility include various events of default customary for such type of agreement, such as failure to pay scheduled payments when due, cross defaults on other indebtedness, change of control events under other indebtedness (including the LYONs, the Notes and the Citicasters Notes, each as defined herein) and certain events of bankruptcy, insolvency and reorganization. In addition, the June 1996 Credit Facility includes events of default for Citicasters and the cessation of any lien on any of the collateral under the June 1996 Credit Facility as a perfected first priority lien and the failure of Zell/Chilmark appointees to represent at least 30% of the Jacor Board of Directors. For purposes of the June 1996 Credit Facility, a change of control includes the occurrence of any event that triggers a change of control under the LYONs, the Notes or the Citicasters Notes. Such change of control under the June 1996 Credit Facility would constitute an event of default which would give the syndicate the right to accelerate the unpaid principal amounts due under the June 1996 Credit Facility. Upon such acceleration, there is no assurance that Citicasters will have funds available to fund such repayment or that such funds will be available on terms acceptable to Citicasters. 10 1/8% SENIOR SUBORDINATED NOTES Concurrently with the consummation of the 1996 Stock Offering, Jacor and JCAC consummated the sale by JCAC of $100.0 million aggregate principal amount of 10 1/8% Senior Subordinated Notes due 2006 (the "Notes"). JCAC loaned the net proceeds of the sale of the Notes (the "Notes Offering") to Jacor in connection with the financing for the Merger. Upon the consummation of the Merger, the Notes became obligations of Citicasters. The Notes will mature on June 15, 2006. The Notes bear interest at the rate per annum of 10 1/8% from the date of issuance or from the most recent interest payment date to which interest has been paid or provided for, payable semi-annually on June 15 and December 15 of each year, commencing December 15, 1996, to the persons in whose names such Notes are registered at the close of business on the June 1 or December 1 immediately preceding such 15 interest payment date. Interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months. The trustee under the indenture for the Notes (the "Senior Subordinated Note Indenture") authenticated and delivered the Notes for original issue in an aggregate principal amount of $100.0 million. The Notes are not redeemable at Citicasters' option before June 15, 2001. Thereafter, the Notes are subject to redemption at the option of Citicasters, at redemption prices declining from 105.063% of the principal amount for the twelve months commencing June 15, 2001 to 100% on and after June 15, 2004, plus in each case, accrued and unpaid interest thereon to the applicable redemption date. The Senior Subordinated Note Indenture contains certain covenants which impose certain limitations and restrictions on the ability of Jacor to incur additional indebtedness, pay dividends or make other distributions, make certain loans and investments, apply the proceeds of asset sales (and use the proceeds thereof), create liens, enter into certain transactions with affiliates, merge, consolidate or transfer substantially all its assets and make investments in unrestricted subsidiaries. If a change of control occurs, Citicasters is required to offer to repurchase all outstanding Notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest, if any, to the date of repurchase. There can be no assurance that Citicasters will have sufficient funds to purchase all of the Notes in the event of a change of control offer or that Citicasters would be able to obtain financing for such purchase on favorable terms, if at all. In addition, the June 1996 Credit Facility restricts Citicasters' ability to repurchase the Notes, including pursuant to a change of control offer. Furthermore, a change of control under the Senior Subordinated Note Indenture will result in a default under the June 1996 Credit Facility. A Change of Control under the indenture governing the Notes means any transaction or series of transactions in which any of the following occurs: (i) any person or group (within the meaning of Rule 13d-3 under the Exchange Act and Sections 13(d) and 14(d) of the Exchange Act), other than Zell/Chilmark or any of its Affiliates, becomes the direct or indirect beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of (A) greater than 50% of the total voting power (on a fully diluted basis as if all convertible securities had been converted) entitled to vote in the election of directors of Citicasters, or the surviving person (if other than Citicasters), or (B) greater than 20% of the total voting power (on a fully diluted basis as if all convertible securities had been converted) entitled to vote in the election of directors of Citicasters, or the surviving person (if other than Citicasters), and such person or group has the ability to elect, directly or indirectly, a majority of the members of the Board of 16 Directors of Citicasters; or (ii) Citicasters consolidates with or merges into another person, another person consolidates with or merges into Citicasters, Citicasters issues shares of its Capital Stock or all or substantially all of the assets of Citicasters are sold, assigned, conveyed, transferred, leased or otherwise disposed of to any person as an entirety or substantially as an entirety in one transaction or a series of related transactions and the effect of such consolidation, merger, issuance or sale is as described in clause (i) above. Events of default under the Senior Subordinated Note Indenture include various events of default customary for such type of agreement, including the failure to pay principal and interest when due on the Notes, cross defaults on other indebtedness for borrowed monies in excess of $5.0 million (which indebtedness therefore includes the June 1996 Credit Facility, the LYONs and the Citicasters Notes) and certain events of bankruptcy, insolvency and reorganization. 9 3/4% SENIOR SUBORDINATED NOTES The 9 3/4% Senior Subordinated Notes due 2004 (the "Citicasters Notes") are general unsecured obligations of Citicasters and are subordinated in rights of payment to all Senior Indebtedness (as defined in the Citicasters Note Indenture). The Citicasters Notes were issued pursuant to an Indenture between Citicasters and Shawmut Bank Connecticut, National Association, as Trustee (the "Citicasters Note Indenture"). The December 31, 1995 aggregate outstanding principal amount of the Citicasters Notes was $122.5 million and the Citicasters Notes mature on February 15, 2004. Interest on the Citicasters Notes accrues at the rate of 9 3/4% per annum. The Citicasters Notes are not redeemable at Citicasters' option before February 15, 1999 (other than in connection with certain public offerings of Citicasters Common Stock, as described below). Thereafter, the Citicasters Notes are subject to redemption at the option of Citicasters, at redemption prices declining from 104.875% of the principal amount for the twelve months commencing February 15, 1999 to 100.00% on and after February 15, 2002, plus, in each case, accrued and unpaid interest thereon to the applicable redemption date. In addition, at any time on or before February 15, 1999, (i) up to 25% of the aggregate principal amount of the Citicasters Notes may be redeemed at a redemption price of 108.75% of the principal amount thereof, plus accrued and unpaid interest, out of the net proceeds of public offerings of primary shares of Citicasters Common Stock, and after giving effect to such redemption at least $100.0 million in Citicasters Notes remain outstanding and (ii) upon a Change of Control (as defined in the 17 Citicasters Note Indenture), the Citicasters Notes can be redeemed provided at least $100.0 million of Citicasters Notes remain outstanding and such redemption occurs within 180 days of the date of a Change of Control. In addition, prior to December 31, 1996, Citicasters can redeem the Citicasters Notes from the proceeds of Asset Sales (as defined in the Citicasters Note Indenture) subject to certain restrictions. Within 60 days after any Change of Control, Citicasters or its successors must make an offer to purchase the Citicasters Notes at a purchase price equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid interest to the date of purchase. The Merger constituted a Change of Control and Jacor has notified the holders of the Citicasters Notes of Citicasters' offer to purchase the Citicasters Notes. Any Citicasters Notes which are not acquired in connection with such Change of Control offer, subject to the successor's right to redeem the Citicasters Notes as described above, will remain outstanding. Upon the consummation of the Merger, the definition of change of control under the indenture governing the Citicasters Notes became substantially similar to the definition of change of control in the Indenture governing the Notes. Jacor will comply with the requirements of Rule 14e-1 in connection with the repurchase of the Citicasters Notes, as such rule might apply to any such repurchase at the time thereof. The Citicasters Note Indenture contains certain covenants which impose certain limitations and restrictions on the ability of Citicasters to incur additional indebtedness, pay dividends or make other distributions, make certain loans and investments, apply the proceeds of Asset Sales (and use the proceeds thereof), create liens, enter into certain transactions with affiliates, merge, consolidate or transfer substantially all its assets, and make investments in unrestricted subsidiaries. The Indenture for the Citicasters Notes includes various events of default customary for such type of agreements, such as failure to pay principal and interest when due on the Citicasters Notes, cross defaults on other indebtedness and certain events of bankruptcy, insolvency and reorganization. LIQUID YIELD OPTION-TM- NOTES Concurrently with the consummation of the 1996 Stock Offering and the Notes Offering, Jacor consummated the issuance and sale of Liquid Yield OptionTM Notes due June 12, 2011 (the "LYONs") in the aggregate principal amount at maturity of $226.0 million (excluding $33.9 million aggregate principal amount at maturity subject to the over-allotment option) (the "LYONs Offering"). Each LYON had an Issue Price of $443.4 and has a principal amount at maturity of $1,000. 18 Each LYON is convertible, at the option of the holder, at any time on or prior to maturity, unless previously redeemed or otherwise purchased, into Common Stock at a conversion rate of 13.412 shares per LYON. The conversion rate will not be adjusted for accrued original issue discount, but is subject to adjustment upon the occurrence of certain events affecting the Common Stock. Upon conversion, the holder will not receive any cash payment representing accrued original issue discount; such accrued original issue discount will be deemed paid by the Common Stock received by the holder on conversion. The LYONs are not redeemable by Jacor prior to June 12, 2001. Thereafter, the LYONs are redeemable for cash at any time at the option of Jacor, in whole or in part, at redemption prices equal to the issue price plus accrued original issue discount to the date of redemption. The LYONs will be purchased by Jacor, at the option of the holder, on June 12, 2001 and on June 12, 2005 for a Purchase Price of $581.25 and $762.39 (representing issue price plus accrued original issue discount to each date), respectively, representing a 5.50% yield per annum to the holder on such date, computed on a semiannual bond equivalent basis. Jacor, at its option, may elect to pay the purchase price on any such purchase date in cash or Common Stock, or any combination thereof. In addition, as of 35 business days after the occurrence of a change in control of Jacor occurring on or prior to June 12, 2001, each LYON will be purchased for cash, by Jacor, at the option of the holder, for a change in control purchase price equal to the issue price plus accrued original issue discount to the change in control purchase date set for such purchase. The change in control purchase feature of the LYONs may in certain circumstances have an anti-takeover effect. Under the indenture for the LYONs (the "LYONs Indenture"), a "Change in Control" of Jacor is deemed to have occurred at such time as (i) any person (as the term "person" is used in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) other than Zell/Chilmark, Jacor, any subsidiary of Jacor, or any employee benefit plan of either Jacor or any subsidiary of Jacor, files a Schedule 13D or 14D-1 under the Exchange Act (or any successor schedule, form or report) disclosing that such person has become the beneficial owner of 50% or more of the Common Stock or other capital stock of Jacor into which such Common Stock is reclassified or changed, with certain exceptions, or (ii) there shall be consummated any consolidation or merger of Jacor (a) in which Jacor is not the continuing or surviving corporation or (b) pursuant to which the Common Stock would be converted into cash, securities or other property, in each case, other than a consolidation or merger of Jacor in which the holders of Common Stock immediately prior to the consolidation or merger own, directly or indirectly, at least a majority of Common Stock of the continuing or surviving corporation immediately after the consolidation or merger. A 19 Change of Control under the LYONs Indenture constitutes an event of default under the June 1996 Credit Facility. See "-- June 1996 Credit Facility." The LYONs Indenture includes various events of default customary for such type of agreement, such as cross defaults on other indebtedness for borrowed monies in excess of $10.0 million (which indebtedness therefore includes the June 1996 Credit Facility, the Notes and the Citicasters Notes) and certain events of bankruptcy, insolvency and reorganization. A change of control under the indenture which governs each of the Notes, the Citicasters Notes and the LYONs will result in a default under the June 1996 Credit Facility. Additionally, unless Citicasters is successful in seeking consents from its lenders under the June 1996 Credit Facility to permit change of control repurchase offers for each of the Notes, the Citicasters Notes or the LYONs or Citicasters is successful in refinancing such borrowings, such event of default under the June 1996 Credit Facility constitutes an event of default under each of the Notes, the Citicasters Notes and the LYONs. Such events of default could result in the immediate acceleration of all then outstanding indebtedness under each of the Notes, Citicasters Notes and LYONs. As a result, differences in the definitions of change of control under the indentures for the Notes and the Citicasters Notes and the LYONs will not have a difference in the effect on Citicasters or the respective holders other than where the lenders under the June 1996 Credit Facility have waived such event of default. In the event of such waiver there could be a change of control under the Notes and the Citicasters Notes which would not result in a change of control under the LYONs or VICE VERSA. PLAN OF DISTRIBUTION SALES BY JACOR From time to time, Jacor will issue and sell shares of Common Stock to the holders of the Warrants upon the exercise of such Warrants in accordance with their terms. All shares of Common Stock issued upon the exercise of Warrants issued to the holders of record of such Warrants, including shares issued to the Selling Security Holders, will be freely transferable, except the shares of Common Stock received by persons (other than the Selling Security Holders) who were deemed to be "affiliates" (as such term is defined under the Securities Act) of Jacor and/or Citicasters prior to the Merger may be resold by them only in transactions permitted by the resale provisions of Rule 145 promulgated under the Securities Act (or Rule 144 in the case of such persons who are affiliates of Jacor and/or Citicasters) or as otherwise permitted under the Securities Act. Persons who may be deemed to be affiliates of Jacor and/or Citicasters include individuals or entities that control, are controlled by, or are under common control with, such party and may include certain officers and 20 directors of such party as well as principal stockholders of such party. SALES BY THE SELLING SECURITY HOLDERS Any distribution hereunder of the Warrants and/or Common Stock by the Selling Security Holders may be effected from time to time in one or more of the following transactions: (a) through brokers, acting as principal or agent, in transactions (which may involve block transactions), in special offerings, on the Nasdaq National Market or otherwise, at market prices obtainable at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices, (b) to underwriters who will acquire shares of Common Stock for their own account and resell such shares in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale (any public offering price and any discount or concessions allowed or reallowed or paid to dealers may be changed from time to time), (c) directly or through brokers or agents in private sales at negotiated prices, (d) to lenders pledged as collateral to secure loans, credit or other financing arrangements and any subsequent foreclosure, if any, thereunder, or (e) by any other legally available means or (f) to their Distributees as defined in the Registration Rights Agreement. Also, offers to purchase the Warrants and/or Common Stock may be solicited by agents designated by the Selling Security Holders from time to time. Underwriters or other agents participating in an offering made pursuant to this Prospectus (as amended or supplemented from time to time) may receive underwriting discounts and commissions under the Securities Act, and discounts or concessions may be allowed or reallowed or paid to dealers, and brokers or agents participating in such transactions may receive brokerage or agent's commissions or fees. EXPERTS The consolidated balance sheets of Jacor Communications, Inc. and Subsidiaries as of December 31, 1995 and 1994 and the consolidated statements of operations, shareholders' equity, and cash flows for each of the three years in the period ended December 31, 1995 incorporated by reference in this Prospectus, have been incorporated herein in reliance on the report of Coopers & Lybrand L.L.P. independent accountants, given on the authority of that firm as experts in accounting and auditing. The consolidated financial statements of Citicasters Inc. appearing in Citicasters Inc.'s Annual Report (Form 10-K) for the year ended December 31, 1995, have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon (which contains an explanatory paragraph with respect to Citicasters Inc.'s emergence from bankruptcy and subsequent adoption of "fresh- start reporting" as of December 31, 1993, as 21 more fully described in Note B to the consolidated financial statements), included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given upon the authority of such firm as experts in accounting and auditing. The consolidated financial statements of Noble Broadcast Group, Inc. as of December 31, 1995 and December 25, 1994 and for each of the three years in the period ended December 31, 1995, incorporated by reference in this Prospectus, have been so incorporated in reliance on the report (which includes an explanatory paragraph relating to Jacor's agreement to purchase Noble Broadcast Group, Inc. as described in Note 2 to the consolidated financial statements), of Price Waterhouse LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. LEGAL MATTERS The legality of the shares of Common Stock to be issued in connection with the exercise of the Warrants is being passed upon for Jacor by Graydon, Head & Ritchey, Cincinnati, Ohio. 22 NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION SHOULD NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO PURCHASE, THE SECURITIES OFFERED BY THIS PROSPECTUS, OR THE SOLICITATION OF A PROXY, IN ANY JURISDICTION, TO OR FROM ANY PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER, SOLICITATION OF AN OFFER OR PROXY SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY DISTRIBUTION OF SECURITIES PURSUANT TO THIS PROSPECTUS SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE INFORMATION SET FORTH HEREIN SINCE THE DATE OF THIS PROSPECTUS. TABLE OF CONTENTS PAGE AVAILABLE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE. . . . . . . . . . . . . . . 3 RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 BUSINESS OF JACOR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 SELLING SECURITY HOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . 9 DESCRIPTION OF CAPITAL STOCK . . . . . . . . . . . . . . . . . . . . . . . . 10 COMMON STOCK. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 CLASS A AND CLASS B PREFERRED STOCK . . . . . . . . . . . . . . . . . . 11 WARRANTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 DESCRIPTION OF INDEBTEDNESS. . . . . . . . . . . . . . . . . . . . . . . . . 14 JUNE 1996 CREDIT FACILITY . . . . . . . . . . . . . . . . . . . . . . . 14 10 1/8% SENIOR SUBORDINATED NOTES . . . . . . . . . . . . . . . . . . . 15 9 3/4% SENIOR SUBORDINATED NOTES. . . . . . . . . . . . . . . . . . . . 17 LIQUID YIELD OPTION-TM- NOTES . . . . . . . . . . . . . . . . . . . . . 18 PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SALES BY JACOR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SALES BY THE SELLING SECURITY HOLDERS . . . . . . . . . . . . . . . . . 21 EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 LEGAL MATTERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 -----END PRIVACY-ENHANCED MESSAGE-----