10-K

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-K

ý	Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the fiscal year ended December 31, 2002, or
o	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period from                              to

Commission File Number
0-24516

HISPANIC BROADCASTING CORPORATION
(Exact name of registrant as specified in its charter)

Delaware
(State of Incorporation) 99-0113417
(I.R.S. Employer Identification No.)

        3102 Oak Lawn Avenue, Suite 215
Dallas, Texas 75219
Telephone (214) 525-7700
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)

        Securities registered pursuant to Section 12(b) of the Act: Class A Common Stock

        Securities registered pursuant to Section 12(g) of the Act: None

        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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).    YES X    No     

        On June 28, 2002 (the last business day of the Company's most recently completed second quarter), the aggregate market price of the Class A Common Stock, $.001 par value, of the Company, held by non-affiliates of the Company was approximately $1,746 million. (For purposes hereof, directors, executive officers and 10% or greater shareholders of the Company have been deemed affiliates).

        On March 15, 2003, there were 80,554,583 outstanding shares of Class A Common Stock, $.001 par value per share.

HISPANIC BROADCASTING CORPORATION
INDEX TO FORM 10-K

		Page Number
PART I.
Item 1.	Business	3
Item 2.	Properties	19
Item 3.	Legal Proceedings	19
Item 4.	Submission of Matters to a Vote of Security Holders	20
PART II.
Item 5.	Market for Registrant's Class A Common Stock and Related Stockholder Matters	21
Item 6.	Selected Financial Data	22
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23
Item 7a.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 8.	Financial Statements and Supplementary Data	31
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	56
PART III.
Item 10.	Directors and Executive Officers of the Registrant	57
Item 11.	Executive Compensation	58
Item 12.	Security Ownership of Certain Beneficial Owners and Management	60
Item 13.	Certain Relationships and Related Transactions	62
Item 14.	Controls and Procedures	62
PART IV.
Item 15.	Exhibits, Financial Statement Schedules, and Reports on Form 8-K	63

2

PART I.

ITEM 1. BUSINESS

General

        Hispanic Broadcasting Corporation (the "Company") is the largest Spanish-language radio broadcasting company, as measured in gross revenues, and the 9^th largest radio broadcaster in the United States^(a). As of December 31, 2002, the Company owned and operated 62 radio stations in 15 markets. Our stations are located in 15 of the top twenty-five largest Hispanic markets in the United States, including Los Angeles, New York, Miami, Chicago, Houston, San Francisco/San Jose, Dallas/Fort Worth, San Antonio, McAllen/Brownsville/Harlingen, Phoenix, San Diego, El Paso, Fresno, Las Vegas and Albuquerque. In addition, we also operate HBC Radio Network, which is one of the largest Spanish-language radio broadcast networks in the United States in terms of audience delivery, and HBCi which operates the Company's Internet website at www.hispanicbroadcasting.com and a network of Hispanic community-focused bilingual websites at www.netmio.com.

        The Company's annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934 ("Exchange Act") will be available free of charge on the Company's website at www.hispanicbroadcasting.com, beginning on April 1, 2003 and, in the future for so long as the Company remains subject to the reporting requirements of the Exchange Act, as soon as reasonably practicable after the reports are filed with or furnished to the Securities and Exchange Commission.

        Our strategy is to own and program top performing Spanish-language and other Hispanic-targeted radio stations, principally in the 15 largest Hispanic markets in the United States. The Company programs 47 radio formats on 62 radio stations. As of the Fall 2002 Arbitron Ratings Book, we operated the leading Spanish-language radio station in the adult 25-54 age group, as measured by audience share, in 9 of the 15 largest markets and, during this same period, we operated 14 top-ten ranked radio stations, regardless of language or format, in such station's market.

        We intend to acquire or develop Hispanic-targeted radio stations in the leading Hispanic markets. The Company historically has acquired under-performing radio stations with good signal coverage of the target population and converted the existing station format to a Hispanic-targeted format. In addition, the Company also seeks to acquire radio stations whose radio signals might eventually be upgraded or improved. The Company's acquisition strategy typically results in a new, start-up acquisition generating operating losses for 12 to 18 months from the date of that acquisition. We believe that the largest Hispanic markets are generally underserved by the existing Hispanic-targeted radio stations. As a result, we expect our acquisitions will achieve an acceptable level of profitability as we build audiences and as more and more advertisers target Hispanics.

        On June 11, 2002, the Company entered into an Agreement and Plan of Reorganization with Univision Communications Inc. ("Univision") and Univision Acquisition Corporation, a wholly-owned subsidiary of Univision. Pursuant to the terms of the agreement, the Company will become a wholly-owned subsidiary of Univision. Univision is a Spanish-language media company based in the United States. Its operations include: Univision Network, a Spanish-language broadcast television network located in the United States; TeleFutura Network, a 24-hour general-interest Spanish-language broadcast television network; Univision Television Group, which owns and operates 22 Univision Network television stations and 1 UPN television station; TeleFutura Television Group, which owns and operates 27 TeleFutura Network television stations; Galavisión, a Spanish-language cable network; Univision Music Group, which includes the Univision Music label, Fonovisa Records label, and a 50% interest in Mexican based Disa Records label as well as Fonomusic and America Musical Publishing companies; and Univision Online, an Internet company in the U.S. Hispanic market located at www.univision.com.

^(a)

The Company's ranking as a U.S. radio broadcaster is provided by BIA Research, Inc.

3

        In the merger, the stockholders of the Company will exchange each share of their capital stock in the Company for the right to receive 0.85 share of the Class A common stock of Univision. As a result of the merger, the stockholders of the Company will acquire approximately 93 million shares of Class A common stock of Univision, which will, assuming no exercise of options or warrants, represent approximately 29% of the outstanding shares of Univision and approximately 14% of the outstanding voting power of Univision as of March 15, 2003.

        The stockholders of the Company and Univision each approved the merger on February 28, 2003. On March 26, 2003, the Company and Univision reached an agreement with the United States Department of Justice ("DOJ") regarding the merger. The closing of the merger also is conditioned on the approval of the Federal Communications Commission (the "FCC") and other customary closing conditions. We anticipate receiving FCC approval during April 2003 and closing the merger shortly thereafter.

4

        The following table sets forth certain information regarding the radio stations that we owned and programmed as of December 31, 2002:

		No. of Stations
Ranking of Market by Hispanic Population(a)
	Market	AM	FM
1	Los Angeles	1	4
2	New York	1	1
3	Miami	2	2
4	Chicago	2	1
5	Houston	2	6
6	San Francisco/San Jose	0	3
7	Dallas/Fort Worth	2	5
8	San Antonio	2	6
9	McAllen/Brownsville/Harlingen	1	2
10	Phoenix	0	5
11	San Diego	0	2
13	El Paso	2	1
16	Fresno	0	1
17	Las Vegas	1	2
20	Albuquerque	0	5
	Total	16	46

^(a)

Ranking of the principal radio market served by the Company's station(s) among all U.S. radio markets by Hispanic population as reported by 2002 Arbitron Metro.

        The Company believes Hispanic-targeted radio broadcasting has significant growth potential for the following reasons:

•

The U.S. Hispanic population is growing rapidly. The U.S. Hispanic population grew from an estimated 22.6 million (approximately 9% of the total U.S. population) at the end of 1990, to an estimated 37 million (approximately 13% of the total U.S. population) by the end of the year 2001. The growth rate is approximately seven times the growth rate for the non-Hispanic population in the U.S. during the same period.



•

The U.S. Hispanic population is concentrated in 15 markets. Approximately 58.9% (approximately 21.8 million) of all U.S. Hispanics live in the top 15 markets. The U.S. Hispanic population in the top 15 markets, as a percentage of total population in such markets, has increased from 18.2% in 1990 to approximately 25.7% in 2002. The percentage concentration of Hispanics in the top 15 markets is approximately twice the percentage of Hispanics in the U.S., as a whole. Since 1990, the Hispanic population growth has represented approximately 54.8% of the total population growth in the Top 15 Hispanic markets.



•

U.S. Hispanics represent an attractive consumer market. Advertisers target Hispanics because, on average, they are younger, their households are larger in size and they routinely spend greater percentages of their income on many different kinds of goods and services than do non-Hispanic households. U.S. Hispanic buying power represents approximately 7.6% of the total U.S. buying power. The Company believes that as a result, advertisers have substantially increased their use of Spanish media. Total Spanish-language advertising revenues have increased from approximately $1.2 billion in 1996 to an estimated $2.5 billion in 2002. This represents a compound annual growth rate of approximately 12.7%, which is substantially greater than the estimated growth rate for total advertising for the comparable period.

5

        The Company was incorporated under the laws of the State of Delaware in 1992. The Company's principal executive offices are located at 3102 Oak Lawn Avenue, Suite 215, Dallas, Texas 75219 and the telephone number is (214) 525-7700.

Hispanic-Targeted Radio

        Due to differences in origin, Hispanics are not a homogeneous group. The music, culture, customs and Spanish dialects vary from one radio market to another. Consequently, the Company programs its stations in a manner responsive to the local preferences of the target demographic audience in each of the markets it serves. A well-researched mix of Spanish-language music and on-air programming at an individual station can attract a wide audience targeted by advertisers. Programming is continuously monitored to maintain its quality and relevance to the target audience. Most music formats are primarily variations of Regional Mexican, Tropical, Tejano and Contemporary music styles. Hispanics who may use English along with Spanish, or perhaps favor English over Spanish, are also reached by the Company's stations through English-language formats tailored to the tastes of Hispanic audiences. The Company currently programs stations in the classis rock, smooth jazz, and rhythmic/contemporary hit formats in this fashion. A brief description of the Company's primary programming formats follows:

        Regional Mexican.    Regional Mexican consists of various types of music played in different regions of Mexico. Ranchera music, originating in Jalisco, Mexico, is a traditional folkloric music commonly referred to as Mariachi music. Mariachi music features acoustical instruments and is considered the music indigenous to Mexicans who have lived in the country towns. Nortena means northern, and is representative of Northern Mexico. Featuring an accordion, Nortena has a Polka sound with a distinct Mexican flavor. Banda is a regional music from the state of Sinaloa, Mexico and is popular in California. Banda is reminiscent of marching band music with mostly brass orchestrations. Mexican Cumbia represents a regional Mexican version of the tropical cumbia style. Grupo music is a synthesizer based modern version of traditional regional music and it covers all the principal styles of the regional genre.

        Tropical.    The Tropical format primarily consists of Salsa, Merengue, and Cumbia music. Salsa is dance music combining Latin Caribbean rhythms with jazz. Salsa includes music from Puerto Rico, Cuba, and the Dominican Republic and is popular with Hispanics living in New York, Miami and Chicago. Merengue music is up-tempo dance music originating in the Dominican Republic. There are also regional derivatives of tropical in Mexico, Central and South America, all based substantially on the Colombian cumbia style.

        Tejano.    Tejano music originated in Texas and is based on Mexican themes but is indigenous to Texas. It is a combination of contemporary rock, Ranchera, and country music. The lyrics are primarily sung in Spanish. The on-air talent speak in Spanish and English.

        Contemporary.    The Contemporary format includes pop, Latin rock, and ballads. This format is similar to English adult contemporary and contemporary hit radio stations. A contemporary station may focus on softer music or may be quite up tempo depending on the age target.

        Full Service.    The Full Service format includes all the traditional radio services: music, news, sports, traffic reports, special information programs and weather.

        News/Talk.    News includes local, national, international reports and weather, business, traffic and sports. Talk includes commentary, analysis, discussion, interviews, call-ins and information shows.

        Mexican Spanish Oldies.    The Spanish Oldies format includes songs of all styles that were hits in Mexico in the 1960s and 1970s.

6

        Rhythmic.    The Rhythmic format includes Latin-oriented hip-hop, top 40 and contemporary music. The on-air talent speak primarily in English.

Company's Stations

        The following table sets forth information regarding the formats and target demographics of the radio stations owned and programmed by the Company as of December 31, 2002:

Ranking of Market by Hispanic Population(a)	Market(b)	Station	Station Format	Primary Demographic Market
1	Los Angeles	KLVE(FM)	Contemporary	A 25-54
		KSCA(FM)	Regional Mexican	A 25-54
		KTNQ(AM)	Spanish Oldies	A 35+
		KRCD(FM)	Spanish Oldies	A 35+
		KRCV(FM)	Spanish Oldies	A 35+
2	New York	WCAA(FM)	Contemporary	A 18-34
		WADO(AM)	News/Talk	A 35+
3	Miami	WAMR(FM)	Contemporary	A 25-54
		WRTO(FM)	Tropical	A 18-34
		WAQI(AM)	News/Talk	A 35+
		WQBA(AM)	News/Talk	A 35+
4	Chicago	WOJO(FM)	Regional Mexican	A 18-49
		WIND(AM)	News/Talk	A 25-54
		WVIV(AM)	Contemporary	A 18-49
5	Houston	KLTN(FM)	Regional Mexican	A 18-49
		KOVE(FM)	Contemporary	A 18-49
		KPTY(FM)	Rhythmic (English)	A 18-34
		KLTO(FM)	Rhythmic (English)	A 18-34
		KOBT(FM)	Contemporary	A 18-34
		KLAT(AM)	Full Service	A 25-54
		KRTX(AM)	Tejano	A 25-54
		KQBU(FM)	Regional Mexican	A 18-49
6	San Francisco	KSOL(FM)	Regional Mexican	A 18-49
	San Jose	KSQL(FM)	Regional Mexican	A 18-49
		KEMR(FM)	Contemporary	A 18-49
7	Dallas/Fort Worth	KLNO(FM)	Regional Mexican	A 18-49
		KHCK(FM)	Tejano	A 25-49
		KDXX(FM)	Contemporary	A 18-49
		KDOS(FM)	Regional Mexican	A 18-49
		KESS(FM)	Regional Mexican	A 18-49
		KESS(AM)	Regional Mexican/Sports	A 18-54
		KHCK(AM)	Tejano	A 25-49
8	San Antonio	KXTN(FM)	Tejano	A 25-54
		KROM(FM)	Regional Mexican	A 25-54
		KXTN(AM)	Tejano	A 25-54
		KCOR(AM)	Contemporary	A 18-49

7

		KBBT(FM)	Rhythmic (English)	A 18-34
		KCOR(FM)	Contemporary	A 18-49
		KVCQ(FM)(c)	N/A	N/A
		KBAE(FM)(c)	Oldies	A 25-54
9	McAllen/Brownsville/Harlingen	KGBT(FM)	Regional Mexican	A 25-54
		KBTQ(FM)	Rhythmic (English)	A 18-34
		KGBT(AM)	News/Talk	A 25-54
10	Phoenix	KHOT(FM)	Regional Mexican	A 25-54
		KHOV(FM)	Regional Mexican	A 25-54
		KOMR(FM)	Contemporary	A 18-34
		KMRR(FM)	Contemporary	A 18-34
		KKMR(FM)	Contemporary	A 18-49
11	San Diego	KLQV(FM)	Contemporary	A 25-54
		KLNV(FM)	Regional Mexican	A 18-49
13	El Paso	KBNA(FM)	Contemporary	A 25-54
		KBNA(AM)	Contemporary	A 25-54
		KAMA(AM)	Spanish Oldies	A 35+
16	Fresno	KZOL(FM)	Regional Mexican	A 18-49
17	Las Vegas	KISF(FM)	Regional Mexican	A 18-49
		KLSQ(AM)	Spanish Oldies	A 35+
		KQMR(FM)	Contemporary	F 25-54
20	Albuquerque	KJFA(FM)	Regional Mexican	A 18-49
		KIOT(FM)	Classic Rock (English)	A 25-64
		KVVF(FM)	Contemporary	A 18-49
		KKSS(FM)	Rhythmic (English)	A 18-34
		KAJZ(FM)	Smooth Jazz (English)	A 25-54

(a)

Statistical information contained herein regarding the radio industry and population ranking is taken from the 2002 Arbitron Hispanic Metro (MSA) Population Ranking, Adults 12+ excluding the embedded MSAs San Jose and Nassau/Suffolk.

(b)

Actual city of license may differ from the broader metropolitan market served.

(c)

A wholly-owned subsidiary of Hispanic Broadcasting Corporation owns 75.5% of Rawhide Radio, LLC which owns these radio stations.

        The following table sets forth selected information with regard to Company owned radio station FCC licenses:

Station/Market	Date Acquired	License Expiration Date	Broadcast Frequency
KLVE(FM), Los Angeles, CA	10/85	12/01/05	107.5 MHz
KSCA(FM), Los Angeles, CA	09/99	12/01/05	101.9 MHz
KTNQ(AM), Los Angeles, CA	10/85	12/01/05	1020 kHz
KRCD(FM), Los Angeles, CA	01/00	12/01/05	103.9 MHz
KRCV(FM), Los Angeles, CA	01/00	12/10/05	98.3 MHz
WCAA(FM), New York, NY	05/98	06/01/06	105.9 MHz

8

WADO(AM), New York, NY	08/94	06/01/06	1280 kHz
WAMR(FM), Miami, FL	08/94	02/01/04	107.5 MHz
WRTO(FM), Miami, FL	10/89	02/01/04	98.3 MHz
WAQI(AM), Miami, FL	10/89	02/01/04	710 kHz
WQBA(AM), Miami, FL	08/94	02/01/04	1140 kHz
WOJO(FM), Chicago, IL	02/97	12/01/04	105.1 MHz
WIND(AM), Chicago, IL	02/97	12/01/04	560 kHz
WVIV(AM), Chicago, IL	07/95	12/01/04	1200 kHz
KLTN(FM), Houston, TX	05/98	08/01/05	102.9 MHz
KOVE(FM), Houston, TX	07/01	08/01/05	106.5 MHz
KPTY(FM), Houston, TX	02/97	08/01/05	104.9 MHz
KLTO(FM), Houston, TX	02/97	08/01/05	105.3 MHz
KOBT(FM), Houston, TX	02/97	08/01/05	100.7 MHz
KLAT(AM), Houston, TX	02/97	08/01/05	1010 kHz
KRTX(AM), Houston, TX	02/97	08/01/05	980 kHz
KQBU(FM), Houston, TX	02/97	08/01/05	93.3 MHz
KSOL(FM), San Francisco/San Jose, CA	02/97	12/01/05	98.9 MHz
KSQL(FM), San Francisco/San Jose, CA	02/97	12/01/05	99.1 MHz
KEMR(FM), San Francisco/San Jose, CA	04/02	12/01/05	105.7 MHz
KLNO(FM), Dallas/Ft. Worth, TX	09/99	08/01/05	94.1 MHz
KHCK(FM), Dallas/Ft. Worth, TX	07/95	08/01/05	99.1 MHz
KDXX(FM), Dallas/Ft. Worth, TX	06/95	08/01/05	107.1 MHz
KDOS(FM), Dallas/Ft. Worth, TX	04/95	08/01/05	107.9 MHz
KESS (FM), Dallas/Ft. Worth, TX	08/94	08/01/05	107.9 MHz
KESS(AM), Dallas/Ft. Worth, TX	08/94	08/01/05	1270 kHz
KHCK(AM), Dallas/Ft. Worth, TX	12/94	08/01/05	1480 kHz
KXTN(FM), San Antonio, TX	02/97	08/01/05	107.5 MHz
KROM(FM), San Antonio, TX	02/97	08/01/05	92.9 MHz
KXTN(AM), San Antonio, TX	02/97	08/01/05	1310 kHz
KCOR(AM), San Antonio, TX	02/97	08/01/05	1350 kHz
KBBT(FM), San Antonio, TX	09/00	08/01/05	98.5 MHz
KCOR(FM), San Antonio, TX	09/00	08/01/05	95.1 MHz
KVCQ(FM), San Antonio, TX	12/02	08/01/05	97.7 MHz
KBAE(FM), San Antonio, TX	12/02	08/01/05	96.3 MHz
KGBT(FM), McAllen/Brownsville/Harlingen, TX	02/97	08/01/05	98.5 MHz
KBTQ(FM), McAllen/Brownsville/Harlingen, TX	02/97	08/01/05	96.1 MHz
KGBT(AM), McAllen/Brownsville/Harlingen, TX	02/97	08/01/05	1530 kHz
KHOT(FM), Phoenix, AZ	04/99	10/01/05	105.9 MHz
KHOV(FM), Phoenix, AZ	10/01	10/01/05	105.3 MHz
KOMR(FM), Phoenix, AZ	10/01	10/01/05	106.3 MHz
KMRR(FM), Phoenix, AZ	10/01	10/01/05	100.3 MHz
KKMR(FM), Phoenix, AZ	10/01	10/01/05	106.5 MHz
KLQV(FM), San Diego, CA	08/98	12/01/05	102.9 MHz
KLNV(FM), San Diego, CA	08/98	12/01/05	106.5 MHz
KBNA(FM), El Paso, TX	02/97	08/01/05	97.5 MHz
KBNA(AM), El Paso, TX	02/97	08/01/05	920 kHz
KAMA(AM), El Paso, TX	02/97	08/01/05	750 kHz
KZOL(FM), Fresno, CA	03/02	12/01/05	107.9 MHz
KISF(FM), Las Vegas, NV	04/99	10/01/05	103.5 MHz

9

KLSQ(AM), Las Vegas, NV	08/95	10/01/05	870 kHz
KQMR(FM), Las Vegas, NV	03/02	10/01/05	99.3 MHz
KJFA(FM), Albuquerque, NM	08/02	10/01/05	101.3 MHz
KIOT(FM), Albuquerque, NM	08/02	10/01/05	102.5 MHz
KVVF(FM), Albuquerque, NM	08/02	10/01/05	101.7 MHz
KKSS(FM), Albuquerque, NM	08/02	10/01/05	105.1 MHz
KAJZ(FM), Albuquerque, NM	08/02	10/01/05	105.1 MHz

Competition

        Radio broadcasting is a highly competitive business. The Company's radio stations compete for audiences and advertising revenues with other radio stations of all formats, as well as with other media, such as newspapers, magazines, television, cable television, outdoor advertising, online, and direct mail, within their respective markets. In addition, the radio broadcasting industry is subject to competition from new media technologies that are being developed or introduced such as (1) satellite-delivered digital audio radio service, which has resulted and is expected to result in the introduction of new subscriber based satellite radio services with numerous niche formats; and (2) audio programming by cable systems, direct broadcast satellite systems, Internet content providers, personal communications services and other digital audio broadcast formats.

        The FCC adopted a plan in 1999 for the establishment of non-commercial "microbroadcasting" stations, low-powered FM stations that will be designed to serve small localized areas and that in some localized areas may cause interference with regular broadcast by existing radio stations. Satellite delivered audio provides a medium for the delivery by satellite or supplemental terrestrial means of multiple new audio programming formats to local and/or national audiences. XM Satellite Radio launched its commercial service on September 25, 2001 and Sirius Satellite Radio launched service on February 14, 2002. The Company entered into a Programming Partner Agreement with XM Satellite Radio in 1998, in which the Company agreed to develop, produce and supply to XM Satellite Radio certain Spanish-language programming to be distributed over one or more audio channels of the digital audio radio service implemented by XM Satellite Radio in the continental United States.

        Audience ratings and market shares are subject to change and any adverse change in the Company's ratings in a particular market could have a material adverse effect on the revenues of stations located in that market. Future operations are further subject to many variables which could have an adverse effect upon the Company's financial performance. These variables include economic conditions, both general and relative to the broadcasting industry; shifts in population and other demographics; the level of competition for advertising dollars with other radio 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, the Federal Trade Commission ("FTC"), and the DOJ. Although the Company believes that each of its stations does or will be able to compete effectively in its respective market, there can be no assurance that any such station will be able to maintain or increase its current audience ratings and advertising revenues. Radio stations can quickly change formats. Any radio station could shift its format to duplicate the format of any of the Company's stations. If a station converted its programming to a format similar to that of a station owned by the Company, the ratings and operating income of the Company's station could be adversely affected.

10

Regulation of the Company's Business

Existing Regulation and Legislation.

        Radio broadcasting is subject to the jurisdiction of the FCC under the Communications Act of 1934, as amended (the "Communications Act"). The Communications Act prohibits the operation of a radio broadcast station except under a license issued by the FCC and empowers the FCC, among other things, to issue, renew, revoke and modify broadcast licenses; assign frequency bands; determine stations' frequencies, locations and power; regulate the equipment used by stations; adopt other regulations to carry out the provisions of the Communications Act; impose penalties for violation of such regulations; and impose fees for processing applications and other administrative functions. The Communications Act prohibits the assignment of a license or the transfer of control of a licensee without prior approval of the FCC.

        The Telecommunications Act of 1996 (the "1996 Act") significantly changed both the broadcast ownership rules and the process for renewal of broadcast station licenses. The 1996 Act relaxed local radio ownership restrictions. The 1996 Act also established a "two-step" renewal process that limits the FCC's discretion to consider applications filed in competition with an incumbent's renewal application. This new regulatory flexibility has engendered aggressive local, regional, and national acquisition campaigns. Relaxation of previous station ownership limitations on leading incumbents (i.e., existing networks and major station groups) has increased sharply the competition for radio station acquisitions, and the prices of attractive stations.

Multiple Ownership Restrictions.

        The FCC has promulgated rules that, among other things, limit the ability of individuals and entities to own or have an official position or ownership interest above a certain level (an "attributable" interest, as defined more fully below) in broadcast stations, as well as other specified mass media entities.

        The 1996 Act and the FCC's subsequently issued rule changes eliminated the national ownership restriction, allowing a single entity to own nationally any number of AM or FM broadcast stations. The 1996 Act and the FCC's rules also greatly eased local radio multiple ownership restrictions. The maximum number of radio stations in which a person or entity is allowed to hold an "attributable interest" depends on the number of radio stations within the defined market. In markets with more than 45 commercial radio stations, an entity may own, operate or control a maximum of eight stations, with no more than five in either service (AM or FM). In markets of 30-44 stations, an entity may own as many as seven stations, with no more than four in either service; in markets with 15-29 stations, an entity may own as many as six stations, with no more than four in either service. In markets with 14 stations or less, an entity may own as many as five stations or 50% of all of the stations, whichever is less, with no more than three stations in either service. It should be noted, however, that the DOJ has precluded certain entities from acquiring the maximum number of radio stations allowed in a market under the 1996 Act because of anti-trust concerns. Thus, it is possible that the Company would, in certain instances, be unable to acquire the maximum number of stations allowed in a market under the 1996 Act. The FCC has placed limitations on time brokerage (local marketing) agreements ("LMA") through which the licensee of one radio station provides the programming for another licensee's station in the same market. In LMA situations, stations operating in the same service (e.g., both stations are AM) with substantial contour overlap are prohibited from duplicating more than 25% of their programming. Moreover, in determining the number of stations that a single entity may control, an entity programming a station pursuant to an LMA is required, under certain circumstances, to count that station toward its numerical maximum even though it does not own the station.

        The FCC's regulations limit the number of radio stations an entity may own or control in markets where the entity also owns or controls one or more television stations. The FCC currently permits an

11

entity to own or control more than one radio station in a market in which the entity also owns or controls one or more television stations, depending on the number of independent voices existing in the market. The FCC's regulations also prohibit an entity from owning both a radio station and a daily newspaper of general circulation in the same market, but the FCC has initiated a proceeding and sought public comment on whether it should relax or eliminate its radio/newspaper cross-ownership restriction.

        Expansion of the Company's broadcast operations in particular areas and nationwide will continue to be subject to the FCC's ownership rules and any further changes the FCC or Congress may adopt. Significantly, the 1996 Act requires the FCC to review its remaining ownership rules biennially—as part of its regulatory reform obligations—to determine whether its various rules are still necessary. In November 2001, the FCC issued a Notice of Proposed Rule Making which solicits public comment on the current local radio multiple ownership rules; the interim processing guidelines announced by the FCC in the November 2002 Notice remain in effect. Also, in September 2002, the FCC issued another Notice of Proposed Rule Making into which it merged the November 2001 Notice and the comments which had been filed into a more comprehensive proceeding to address many other broadcast and other media matters affecting radio, TV, newspapers, etc.; the latter proceeding remains pending at the FCC at this time. The Company cannot predict the impact of future announcements in the biennial review process or any other agency or legislative initiatives upon the FCC's broadcast rules.

        Under the FCC's ownership rules, a direct or indirect purchaser of certain types of securities of the Company could violate FCC regulations if that purchaser owned or acquired an "attributable" interest in other media properties in the same areas as stations owned by the Company or in a manner otherwise prohibited by the FCC. All officers and directors of a licensee, as well as general partners, limited partners who are not properly "insulated" from management activities, and stockholders who own five percent or more of the outstanding voting stock of a licensee (either directly or indirectly), are generally deemed to have an "attributable interest" in the licensee. Certain institutional investors who exert no control or influence over a licensee may own up to twenty percent of such outstanding voting stock without the interest being considered "attributable". In addition to the foregoing limitations, under the FCC's "equity/debt plus" standard, if an investor's interest in a licensee corporation exceeds thirty-three percent of the aggregated debt and equity of the company (i.e., the "total asset value" of the company), the investor's interest is considered attributable if the investor is also either a major program supplier to the licensee or a same-market media entity. Insulated limited partnership interests (as to which the licensee certifies that the limited partners are not "materially involved" in the management and operation of the subject media property), and voting stock held by minority stockholders where there is a single majority stockholder, are generally not considered attributable interests.

License Grant and Renewal.

        Under the 1996 Act, the FCC has implemented an eight year license term provision for radio stations. The 1996 Act also requires renewal of a broadcast license if the FCC finds that (1) the station has served the public interest, convenience, and necessity; (2) there have been no serious violations of either the Communications Act or the FCC's rules and regulations by the licensee; and (3) there have been no other serious violations which, taken together, constitute a pattern of abuse. In making its determination, the FCC may still consider petitions to deny a renewal application but cannot consider whether the public interest would be better served by a person/entity other than the renewal applicant. Instead, competing applications for the same frequency may be accepted only after the FCC has denied an incumbent's application for renewal of license.

        Although in the vast majority of cases the FCC grants broadcast license renewal applications when petitions to deny are filed against them, there can be no assurance that any of the Company's stations' licenses will be renewed.

12

Alien Ownership Restrictions.

        The Communications Act restricts the ability of foreign entities or individuals to own or hold certain interests in broadcast licenses. Foreign governments, representatives of foreign governments, non-U.S. citizens, representatives of non-U.S. citizens, and corporations or partnerships organized under the laws of a foreign nation are barred from holding broadcast licenses. Non-U.S. citizens, collectively, may directly or indirectly own or vote up to twenty percent of the capital stock of a licensee. In addition, a broadcast license may not be granted to or held by any corporation that is controlled, directly or indirectly, by any other corporation more than one-fourth of whose capital stock is owned or voted by non-U.S. citizens or their representatives, by foreign governments or their representatives, or by non-U.S. corporations, if the FCC finds that the public interest will be served by the refusal to grant or revocation of such license. The FCC has interpreted this provision of the Communications Act to require an affirmative public interest finding before a broadcast license may be granted to or held by any such corporation, and the FCC has made such an affirmative finding only in limited circumstances. The Company, which serves as a holding company for subsidiaries that serve as licensees for the stations, therefore may be restricted from having more than one-fourth of its stock owned or voted directly or indirectly by non-U.S. citizens, foreign governments, representatives of non-U.S. citizens or foreign governments, or foreign corporations. Our certificate of incorporation prohibits the ownership, voting and transfer of our capital stock in violation of the FCC restrictions, and prohibits the issuance of capital stock or the voting rights such capital stock represents to or for the account of aliens or corporations otherwise subject to domination or control by aliens in excess of the FCC limits. The certificate of incorporation authorizes our board of directors to enforce these prohibitions.

Other Regulations Affecting Radio Broadcasting Stations.

        Although the FCC has significantly reduced its regulation of radio broadcast stations, the FCC rules and policies, and rules and policies of other federal agencies, currently regulate matters such as political advertising practices, equal employment opportunities, application procedures and other areas affecting the business and operations of radio broadcast stations.

Antitrust Matters.

        An important element of the Company's growth strategy involves the acquisition of additional radio stations, many of which are likely to require preacquisition antitrust review by the FTC or the DOJ. Following passage of the 1996 Act, the DOJ has become more aggressive in reviewing proposed acquisitions of radio stations and radio station networks, particularly in instances where the proposed acquirer seeks to acquire another radio station in a market in which it already owns stations. The DOJ has, in some cases, obtained consent decrees requiring radio station divestitures in specific markets based on allegations that proposed acquisitions would lead to unacceptable concentration levels. There can be no assurance that the DOJ or the FTC will not seek to bar the Company from acquiring additional radio stations in a market where the Company already owns stations.

        The FCC has been increasingly aggressive in independently examining issues of market concentration when considering radio station acquisitions. The FCC has delayed its approval of several radio station purchases by various parties because of market concentration concerns. Moreover, the FCC has followed an informal policy of giving specific public notice of its intention to conduct additional ownership concentration analysis and soliciting public comment on the issue of concentration and its effect on competition and diversity with respect to certain applications for consent to radio station acquisitions.

13

Environmental Matters.

        As the owner, lessee or operator of various real properties and facilities, the Company is subject to various federal, state and local environmental laws and regulations. Historically, compliance with such laws and regulations has not had a material adverse effect on the Company's business. There can be no assurance, however, that compliance with existing or new environmental laws or regulations will not require the Company to make significant expenditures in the future.

Recent Developments, Proposed Legislation and Regulation.

        The FCC has approved the introduction of new technologies to the radio broadcasting industry, including terrestrial delivery of digital audio broadcasting on both the AM and FM bands. In 1997, the FCC granted two licenses for national, satellite-delivered digital audio broadcasting services. These services are capable of delivering multiple, high-quality audio channels. The Company is unable to predict the effect such new technology will have on the Company's financial condition or results of operations. In addition, cable television operators and direct satellite broadcast television companies market service commonly referred to as "cable radio" which provides subscribers with several high-quality channels of music, news and other information. Technical considerations currently limit this technology to fixed locations.

        Congress and the FCC currently have under consideration, and may in the future, adopt new laws, regulations and policies regarding a wide variety of matters that could affect, directly or indirectly, the operation and ownership of the Company's broadcast properties. For example, the FCC has adopted rules which, with limited exceptions, require the holder of an FCC construction permit to complete construction of new or modified facilities within three (3) years of grant. In November 2002, the FCC adopted new broadcast equal employment opportunity rules which became effective on March 10, 2003. In addition to the changes and proposed changes noted above, such matters include, for example, the license renewal process, spectrum use fees, political advertising rates, and potential restrictions on the advertising of certain products (liquor, beer and wine, for example). Other matters that could affect the Company's broadcast properties include technological innovations and developments generally affecting competition in the mass communications industry. The foregoing does not purport to be a complete summary of all the provisions of the Communications Act, or the 1996 Act, nor of the regulations and policies of the FCC thereunder. Proposals for revised regulations and requirements are currently pending before Congress and federal regulatory agencies, and additional regulations will undoubtedly be considered in the future from time to time. Also, various of the foregoing matters are now, or may become, the subject of court litigation, and the Company cannot predict the outcome of any such litigation or the impact on its broadcast business.

Risk Factors

Decreases in Operating Income from Our Los Angeles Stations Could Significantly Reduce Our Overall Results of Operations.

        The portion of our overall net revenue attributable to the Los Angeles market was 23.9% for the year ended December 31, 2002. In addition, the portion of our overall operating income attributable to the Los Angeles market was 41.7% for the year ended December 31, 2002. Increased competition for advertising dollars with other radio stations and communications media in the Los Angeles metropolitan area, both from other radio stations and from other advertising media such as television and newspapers, and other competitive and economic factors have and may continue to cause a decline in revenue generated by our Los Angeles stations. A significant decline in the revenue of the Los Angeles stations could significantly reduce our overall results of operations.

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Significant Control by the Tichenor Family May Impact or Constrain Our Future Actions.

        As of March 15, 2003, McHenry T. Tichenor, Jr., our Chairman, President and Chief Executive Officer, and his family held voting control over approximately 16.2% of the shares of our Class A Common Stock. Since these shares are subject to a voting agreement, the Tichenor family can exert significant influence over the election of our board of directors and other management decisions.

Clear Channel's Ownership of All Our Class B Common Stock Means that Clear Channel May Have a Class Vote on Mergers, Consolidations, and Sales of Substantially All Our Assets.

        As of March 15, 2003, Clear Channel Communications, Inc. ("Clear Channel") owned no shares of our Class A Common Stock and thus was not entitled to vote in the election of our directors. However, Clear Channel does own all the outstanding shares of our Class B Common Stock, par value $.001 per share, which accounts for approximately 26.0% of our common stock. As long as Clear Channel owns at least 20.0% of our common stock, Clear Channel will have a class vote regarding, and could potentially veto, the following:

•

sales of all or substantially all our assets;



•

any merger or consolidation involving the Company where our stockholders immediately prior to the transaction would not own at least 50.0% of the capital stock of the surviving entity;



•

any reclassification, capitalization, dissolution, liquidation, or winding up of the Company;



•

the issuance of any shares of our preferred stock;



•

the amendment of our restated certificate of incorporation in a manner that adversely affects the rights of the holders of our Class B Common Stock;



•

the declaration or payment of any non-cash dividends on our common stock; or



•

any amendment to our certificate of incorporation concerning our capital stock.

        Shares of our Class B Common Stock are generally convertible into shares of our Class A Common Stock, at the holder's option, subject to any necessary governmental consents, including the consent of the FCC. Because of the FCC's multiple ownership rules, which limit the number of radio stations that a company may own or have an attributable interest in, in any single market, Clear Channel may not presently convert its shares of our Class B Common Stock into shares of our Class A Common Stock if such conversion would create an attributable interest, without first obtaining the consent of the FCC.

        In addition, Clear Channel owns a significant percentage of our common stock. Consequently, significant direct or indirect sales of our common stock by Clear Channel could significantly reduce our stock price and could impair our ability to raise money.

Hispanic Broadcasting and Clear Channel are Each Engaged in the Radio Broadcasting Business and Compete with Each Other for Advertising Revenues, Which May Give Rise to Actual or Potential Conflicts of Interest Between the Two Companies.

        The similarity of the respective businesses of the Company and Clear Channel gives rise to potential conflicts of interest between the two companies. The Company and Clear Channel are each engaged in the radio broadcasting business in certain markets, and as a result, are competing with each other for advertising revenues. As of December 31, 2002, Clear Channel owned, programmed, or sold airtime for 1,184 radio stations in the United States, as well as radio stations in a number of foreign countries. Clear Channel also owned or programmed 34 television stations and was one of the world's largest outdoor advertising companies based on its total inventory of advertising display faces. Clear Channel's television and outdoor advertising operations may also be deemed to compete with our

15

business. In addition, conflicts could arise with respect to transactions involving the purchase or sale of radio broadcasting companies, particularly Spanish-language radio broadcasting companies, the issuance of additional equity securities, or the payment of dividends by the Company. For instance, Clear Channel currently owns a 40% equity interest in Grupo ACIR Comunicaciones, one of the largest radio broadcasters in Mexico.

We May Compete Directly or Indirectly With Clear Channel in the Future With Respect to Acquisitions and Investment Opportunities in New Lines of Business and New Markets, but We May Lack the Financial Resources Necessary to Compete with Clear Channel in these New Lines and Markets.

        Clear Channel is engaged in the Spanish-language radio broadcasting business in the United States, other than through its ownership of shares in the Company. Clear Channel may from time to time acquire domestic Spanish-language radio broadcasting companies or an interest in such companies, individually or as part of a larger group. Furthermore, Clear Channel may from time to time seek to make international acquisitions of, or investments in, companies engaged in the Spanish-language radio broadcasting business outside the United States, and we may compete with Clear Channel for such acquisition or investment opportunities. To the extent we enter into new lines of business, we may compete directly or indirectly with Clear Channel, and we may compete with Clear Channel in the future with respect to acquisitions and investment opportunities in these areas.

        Because we are significantly smaller than Clear Channel, we may lack the financial resources necessary to compete with Clear Channel in these new lines of business and new markets. Similarly, while Clear Channel could pursue very large business expansions, acquisition opportunities could arise which require greater financial resources than those available to us.

Cancellations or Reductions of Advertising Could Adversely Affect Our Results of Operation

        In the competitive radio broadcasting industry, the success of each of our radio stations is primarily dependent upon its share of the overall advertising revenue within its market. Although we believe that each of our stations can compete effectively in its broadcast area, we cannot be sure that any of our stations can maintain or increase its current audience ratings or market share, or that advertisers will not decrease the amount they spend on advertising. Shifts in population, demographics, audience tastes and other factors beyond our control could cause us to lose market share. Our stations also compete for audiences and advertising revenue directly with other radio and television stations. If a competing station converts to a format similar to that of one of our stations, or if one of our competitors strengthens its operations, our stations could suffer a reduction in ratings and advertising revenue.

        We believe that adverting is a discretionary business expense, meaning that spending on advertising may decline during an economic recession or downturn. Consequently, a recession or downturn in the U.S. economy or the economy of an individual geographic market in which we operate stations could reduce our advertising revenue and, therefore, results of operations. We do not obtain long-term commitments from our advertisers, and advertisers may cancel, reduce or postpone orders without penalty. Cancellations, reductions or delays in purchases of advertising could reduce our revenue, especially if we are unable to replace such purchases. Our expense levels are based, in part, on expected future revenue and are relatively fixed once set. Therefore, unforeseen fluctuations in adverting sales could reduce our operating results.

16

Our Acquisition Strategy Could Pose Risks.

        We intend to grow through the acquisition of radio stations and other assets we believe will complement our existing portfolio. Our acquisition strategy involves numerous risks, including:

•

the risk that certain acquisitions may prove unprofitable and fail to generate anticipated cash flows;



•

the risk that successful management of a portfolio of radio broadcasting properties may require us to recruit additional senior management and expand corporate infrastructure;



•

the risk that we may encounter difficulties in the integration of operations and systems;



•

the risk that management's attention may be diverted from other business concerns; and



•

the risk that we may lose key employees of acquired companies or stations.

        Part of our strategy is to acquire radio stations and convert them to a Spanish-language or other Hispanic-targeted format. This conversion strategy requires a heavy initial investment of both financial and management resources. Start-up stations typically incur losses for a period approximately 12 to 18 months from the date of launch of a station's format because of the time required to build up ratings and station loyalty. We cannot guarantee that this strategy will be successful in any given market, even though we may incur substantial costs and losses in implementing this part of our strategy.

International Acquisition Opportunities Pose Risks to Which We are Not Accustomed, Such as Risks of Foreign Currency Fluctuations, Foreign Taxation, and Additional or Novel Legal Restrictions.

        We continue to explore international opportunities. If we make one or more international acquisitions, we will face new risks that we do not face in the United States, such as foreign currency risks, foreign ownership restrictions, foreign taxation, restrictions on withdrawal of foreign investments and earnings, possible expropriation and other risks.

We May Not be Able to Secure Financing Necessary for Acquisition Opportunities, or We May have to Secure Financing on Unfavorable Terms.

        We face stiff competition from other companies for acquisition opportunities. If the prices sought by sellers of existing radio stations continue to rise, we may find fewer acceptable acquisition opportunities. In addition, the purchase price of possible acquisitions could require additional debt or equity financing. We can give no assurance that either we will obtain the needed financing or that we will obtain such financing on attractive terms. Additional indebtedness could increase our leverage and make us more vulnerable to economic downturns and may limit our ability to withstand competitive pressures. Additional equity financing or the issuance of our shares in connection with an acquisition would dilute the ownership interest of our stockholders. We may not have sufficient capital resources to complete acquisitions.

Caution Concerning Forward-Looking Statements

        This report may contain forward-looking statements within the meaning of Section 21E of the Exchange Act. Forward-looking statements are not statements of historical facts, but rather reflect our current expectations concerning future results and events. You can identify these forward-looking statements by our use of works such as "anticipates," "believes," "continues," "expects," "intends," "likely," "may," "opportunity," "plans," "potential," "project," "will," and similar expressions to indicate 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

17

cause actual results to differ materially from those forecast or anticipated in such forward-looking statements. These risks, uncertainties and factors include, but are not limited to:

•

the highly competitive nature of, and uncertain effect of new technologies on, the radio broadcasting industry;



•

the risks associated with our acquisition and upgrade strategies generally;



•

the risks associated with achieving positive operating results on our start-up stations;



•

our vulnerability to changes in federal legislation or regulatory policy;



•

the impact of general economic conditions;



•

shifts in population and other demographics;



•

industry conditions, including competition;



•

technological changes and innovations;



•

changes in labor conditions;



•

capital expenditure requirements;



•

interest rates and inflation;



•

taxes;



•

access to capital markets; and



•

certain other factors set forth in our SEC filings.

        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 revisions to these statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.

Signal Improvements

        From time to time, the Company has sought to improve the signal coverage of selected stations it owns. In addition, the Company has and will in the future seek to acquire and/or to participate in proceedings at the FCC that would allow the radio signals of the Company's existing radio stations or stations it might acquire in the future to be upgraded or improved. A proceeding to change the signal coverage of one of our radio stations can take years to complete. As a result, the Company may have to invest or spend money during the upgrade process without knowing if the process will ultimately be successful. The upgrade process is typically subjected to one or more objections and/or counterproposals by other station owners. These objections require time to resolve and might result in additional, unforeseen payments or costs in order to complete the upgrade. At December 31, 2002, the Company had invested approximately $4.6 million in various upgrade proceedings or efforts with respect to its stations and is obligated to pay in the future approximately $0.8 million associated with one upgrade project. The Company is also working a variety of upgrade moves that, if successful, could obligate the Company to pay additional amounts to complete the upgrades. There can be no assurances that any pending or future upgrades will be successfully concluded. Any investment the Company makes, is obligated to make, or has made in upgrade attempts that prove to be unsuccessful would likely require write-downs or write-offs. The Company's current exposure associated with various uncompleted upgrade projects, if partially or totally written off as a result of unsuccessful outcomes of these projects, would not be material to the overall financial position of the Company.

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Industry Segments

        The Company considers radio broadcasting to be its only operating segment.

Employees

        As of January 25, 2003, the Company employed 1,051 persons on a full-time basis, including corporate employees and 90 employees (at WCAA(FM) and WADO(AM) in New York City) who are subject to two collective bargaining agreements. The Company considers its employee relations to be good.

Seasonality

        Our Company's performance and that of the radio industry as a whole is affected by seasonal revenue fluctuations and variation in demand between local and national advertisers. The Company's revenues vary throughout the year. As is typical in the radio broadcasting industry, the first calendar quarter generally produces the lowest revenues. The second and third quarters generally produce the highest revenues. Revenues are also affected by audience share performance of each of the Company's radio stations as reported by The Arbitron Company. Revenue performance of a radio station tends to lag behind the audience share ratings

ITEM 2. PROPERTIES

        The Company's corporate headquarters is in Dallas, Texas. The Company has leased approximately 11,000 square feet at 3102 Oak Lawn Avenue in Dallas, Texas. The initial term of this lease expires in 2013, and the Company has one option to extend the lease for one additional five-year term.

        The types of properties required to support each of the Company's radio stations listed in Item 1 above include office and transmitter sites. A radio station's studios are generally housed with its offices in downtown or business districts. A radio station's transmitter sites generally are located in a manner that provides maximum market coverage subject to the station's FCC license and FCC rules and regulations.

        The offices and studios of the Company's radio stations are located in leased or owned facilities. These leases generally have expiration dates that range from three to fifteen years. The Company either owns or leases its transmitter and antenna sites. These leases generally have expiration dates that range from one to seventeen years. The Company does not anticipate any difficulties in renewing those leases that expire within the next several years or in leasing other space, if required.

        A substantial amount of the Company's operating income was generated by the Company's Los Angeles stations during 2002. Accordingly, the offices, studios, transmitter sites and antenna sites used in the operation of the Company's Los Angeles stations may be material to the Company's overall operations.

        As noted in Item 1 above, as of December 31, 2002, the Company owned and operated 62 radio stations in 15 markets throughout the United States. Therefore, except as set forth above, no one property is material to the Company's overall operations. The Company believes that its properties are in good condition and suitable for its operations. The Company owns substantially all of the equipment used in its radio broadcasting business.

ITEM 3. LEGAL PROCEEDINGS

        The Company is subject to legal proceedings and other claims which have arisen in the ordinary course of business and as described below and have not been fully adjudicated. These actions, when

19

ultimately concluded, will not, in the opinion of management, have a material adverse effect upon the financial position or results of operation of the Company.

        On June 12, 2002, Spanish Broadcasting System, Inc. ("SBS") filed Spanish Broadcasting System, Inc. v. Clear Channel Communications, Inc. and Hispanic Broadcasting Corporation in the United States District Court for the Southern District of Florida. SBS alleged a variety of claims against the defendants including claims for federal and state antitrust violations under the Sherman Act, the Florida Antitrust Act, and California's Cartwright Act. Plaintiff's complaint also included numerous other state law causes of action including, among others, tortuous interference, defamation, and violation of the California Unfair Competition Act. The plaintiff, and both defendants, own and operate radio stations throughout the United States, and plaintiff's claims arose out of steps the defendants allegedly took to undermine plaintiff's radio station business. On July 31, 2002, plaintiff amended its complaint. The amended complaint sought actual damages in excess of $500 million before any trebling under federal or state statute along with attorney fees and other unspecified damages. On January 31, 2003, the United States District Court entered a final order dismissing the case with prejudice. On February 14, 2003, SBS filed a motion for reconsideration of the order which dismissed the case. SBS has announced that, if its motion for reconsideration is not granted, then it will appeal the dismissal order. The Company is vigorously contesting this matter.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

        None.

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PART II.

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

Price Range of Class A Common Stock

        The Class A Common Stock is traded on the New York Stock Exchange under the symbol "HSP." The following table sets forth for each of the periods presented below, the high and low closing sale prices per share:

		High		Low
Year Ended December 31, 2001
	First Quarter	$	37.44	$	17.90
	Second Quarter		28.69		15.69
	Third Quarter		27.74		14.11
	Fourth Quarter		26.00		15.90
Year Ended December 31, 2002
	First Quarter	$	31.65	$	22.67
	Second Quarter		29.94		23.75
	Third Quarter		25.97		16.40
	Fourth Quarter		27.22		16.70

        As of December 31, 2002, there were approximately 109 and 1 record holders of the Class A and Class B Common Stock, respectively. This figure does not include an estimate of the indeterminate number of beneficial holders whose shares of Class A Common Stock may be held of record by brokerage firms and clearing agencies.

Dividend Policy

        The Company has never paid a cash dividend on its common stock and does not anticipate paying cash dividends in the foreseeable future. The Company intends to retain any earnings for use in the growth of its business. The Company currently is restricted from paying any cash dividends on its capital stock under its credit agreement.

Stock Options

        In May 1997, the stockholders of the Company approved a stock incentive plan ("Long-Term Incentive Plan"). Securities authorized for issuance under equity compensation plans as of December 31, 2002 are as follows:

Plan category		Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)	Weighted-average exercise price of outstanding options warrants and rights (b)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a) (c)
Equity compensation plans approved by security holders		5,635,306	$	22.47	2,416,312
Equity compensation plans not approved by security holders		—		—	—
	Total	5,635,306	$	22.47	2,416,312

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ITEM 6. SELECTED FINANCIAL DATA

        The selected consolidated financial data listed below should be read with Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations and with the Company's consolidated financial statements including notes thereto, included elsewhere in this report. The following table presents selected consolidated financial data for the Company and its subsidiaries for the years ended December 31, 2002, 2001, 2000, 1999 and 1998 (in thousands, except per share data):

			Year Ended December 31,
			2002			2001			2000			1999			1998
Statement of Operations Data:
Net revenues			$	256,545		$	240,775		$	237,554		$	197,920		$	164,122
Operating expenses				78,768			75,399			65,741			51,154			48,511
Wages, salaries and benefits				85,955			76,363			69,985			57,389			48,947
Provision for bad debts				2,633			4,289			3,757			1,869			1,418
Depreciation and amortization				12,267			36,415			34,264			28,492			21,149
Corporate expenses				10,992			3,718			3,879			2,858			2,359
Operating income				65,930			44,591			59,928			56,158			41,738
Other income (expense):
	Interest income (expense), net			557			3,449			7,078			1,831			2,634
	Other, net			—			2,871			1,585			—			252
				557			6,320			8,663			1,831			2,886
Income before income tax				66,487			50,911			68,591			57,989			44,624
Income tax				26,274			19,942			27,060			23,813			17,740
Net income			$	40,213		$	30,969		$	41,531		$	34,176		$	26,884
Net income per common share(a):
		Basic	$	0.37		$	0.28		$	0.38		$	0.34		$	0.27
		Diluted	$	0.37		$	0.28		$	0.38		$	0.33		$	0.27
Weighted average common shares outstanding(a):
	Basic			108,723			108,872			108,858			101,566			98,042
	Diluted			109,543			109,617			110,388			102,927			98,695
Statement of Cash Flow Data:
Net cash provided by operating activities			$	74,625		$	79,878		$	70,843		$	61,641		$	56,985
Net cash used in investing activities				(113,055	)		(129,963	)		(172,514	)		(226,133	)		(246,326	)
Net cash provided by (used in) financing activities				19,060			(6,017	)		2,224			369,335			193,081
Other Operating Data(b):
EBITDA			$	78,197		$	81,006		$	94,192		$	84,650		$	62,887
Balance Sheet Data (at end of period):
Working capital			$	70,807		$	86,553		$	145,714		$	231,137		$	17,168
Net intangible assets				1,166,090			1,023,400			942,153			848,351			646,201
Total assets				1,325,788			1,241,743			1,204,648			1,157,138			746,689
Long-term debt, less current portion				16,429			1,418			1,404			1,448			1,547
Stockholders' equity				1,142,219			1,096,816			1,071,003			1,026,253			622,621

^(a)

All common share and per-common-share amounts have been adjusted retroactively for a two-for-one common stock split effective June 15, 2000.

^(b)

EBITDA consists of operating income excluding depreciation and amortization. The Company has included EBITDA data because EBITDA is commonly used as a measure of performance for broadcast companies and is used to measure a company's ability to service its debt and other obligations. EBITDA is not calculated in accordance with generally accepted accounting principles. This measure should not be considered in isolation or as a substitute for or as superior to operating income, cash flows from operating activities or any other

22

measure for determining our operating performance or liquidity that is calculated in accordance with generally accepted accounting principles. Further, such amount may not be consistent with similarly titled measures presented by other companies. For the reconciliation of operating income to EBITDA, refer to Managements' Discussion and Analysis of Financial Condition and Results of Operations in this report.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

        The following discussion of the consolidated results of operations and cash flows of the Company for the years ended December 31, 2002, 2001 and 2000 and consolidated financial condition as of December 31, 2002 and 2001 should be read in conjunction with the consolidated financial statements of the Company and its subsidiaries and the related notes included elsewhere in this report.

General

        The Company's primary source of revenues is the sale of broadcasting time for advertising. In 2002, we generated approximately 66.4% of our gross revenues from local advertising, which is sold primarily by each individual local radio station's sales staff, and approximately 26.6% from national spot advertising, which is sold by independent advertising sales representatives. The balance of our 2002 revenues came from network sales, political sales, miscellaneous revenues such as rental income from tower sites, and from our Internet operation.

        Our most significant operating expenses are sales expenses, programming expenses, and advertising and promotion expenses. Operating expenses are affected in part by the timing of promotion campaigns to improve audience ratings, the timing of acquisitions, and the financial performance of our new station formats.

        The Company has historically purchased under-performing radio stations with good signal coverage and converted the formats to a variety of Hispanic-targeted formats. As a result, the historical financial performance of acquired radio stations is not a good indicator of future financial performance. A new start-up radio station typically generates operating losses in the first 12 to 18 months of operation. The magnitude of operating losses is determined in part by the size of the market served by the radio station, the amount of promotion expense required to attract an audience to the station, and the size of the acquisition. Thus, the Company's financial results in any given year can be affected by the timing, number, acquisition cost and operating expenses of its start-up stations in that year.

        EBITDA consists of operating income or loss excluding depreciation and amortization. The Company has included EBITDA data because EBITDA is commonly used as a measure of performance for broadcast companies and is used to measure a company's ability to service its debt and other obligations. EBITDA is not calculated in accordance with generally accepted accounting principles. This measure should not be considered in isolation or as a substitute for or as superior to operating income, cash flows from operating activities or any other measure for determining operating performance or liquidity that is calculated in accordance with generally accepted accounting principles. EBITDA does not take into account the Company's debt service requirements and other commitments and, accordingly, it is not necessarily indicative of an amount that may be available for dividends, reinvestment in the Company's business or other discretionary uses. In addition, our definition of EBITDA is not necessarily comparable to similarly titled measures reported by other companies. Below

23

is a reconciliation of the Company's operating income to EBITDA for the most recent five years (in thousands):

	Year Ended December 31,
	2002		2001		2000		1999		1998
Operating income	$	65,930	$	44,591	$	59,928	$	56,158	$	41,738
Depreciation and amortization		12,267		36,415		34,264		28,492		21,149
EBITDA	$	78,197	$	81,006	$	94,192	$	84,650	$	62,887

        In 2001 and 2000, the Company funded its acquisitions with available cash. In addition, the Company's financial performance benefited from interest income generated on the Company's available cash balances. In 2002, the Company used its excess cash to acquire more radio stations and borrowed from its $180.0 million revolving credit facility (the "Credit Facility"). As a result, interest income and securities gains will decline and interest expense and long-term obligations will increase.

        On June 11, 2002, the Company agreed to merge with Univision. Univision will acquire the Company in an all-stock transaction. In the merger, the stockholders of the Company will exchange each share of their capital stock in the Company for the right to receive 0.85 share of the Class A common stock of Univision. The boards of directors of both companies approved the merger, the stockholders of each company voted in favor of the merger on February 28, 2003, and the DOJ, Univision and the Company have reached an agreement regarding the merger. The merger is subject to approval by the FCC and customary closing conditions. The Company expects that the merger will close in April 2003.

Results of Operations for the year Ended December 31, 2002 Compared to the Year Ended December 31, 2001

        The results of operations for the year ended December 31, 2002 are not comparable to the results of operations for the same period in 2001 primarily due to the programming format change on KQBU(FM) in Houston on August 18, 2001 and the acquisitions of KOVE(FM) in Houston on July 20, 2001, KOMR(FM), KMRR(FM), KKMR(FM) and KHOV(FM) in Phoenix on October 31, 2001, KQMR(FM) in Las Vegas on March 22, 2002, KZOL(FM) in Fresno on March 29, 2002, KSOL(FM) in San Jose on April 1, 2002 and KIOT(FM), KVVF(FM), KJFA(FM), KAJZ(FM) and KKSS(FM) in Albuquerque on November 1, 2002. In addition, in January 2002, the Company launched HBC Sales Integration, Inc. ("HBCSi"). The Company has adopted the marketing name HBCSi to brand all aspects of its national and network sales efforts, including HBC Radio Network sales, new business development, and, in cooperation with Katz Hispanic Media, national spot advertising sales.

        Net revenues increased by $15.7 million or 6.5% to $256.5 million for the year ended December 31, 2002 from $240.8 million for the same period in 2001. Net revenues increased for the year ended December 31, 2002 primarily because of (a) revenues from start-up stations acquired or reformatted in 2001 and 2002, which represent an increase of $5.6 million, and (b) revenue growth in New York, Miami, San Antonio and San Diego, and on Houston and Dallas stations that were not considered start-ups. The revenue growth was offset by a revenue decline in Los Angeles and on San Francisco stations that were not considered start-ups, which collectively represent an increase of $9.0 million.

        Operating expenses increased by $3.4 million or 4.5% to $78.8 million for the year ended December 31, 2002 from $75.4 million for the same period in 2001. Operating expenses increased for the year ended December 31, 2002 because of (a) $4.8 million of expense for start-up stations acquired or reformatted in 2001 or 2002, and (b) partially offset by $2.1 million decrease in promotions spending for stations in Los Angeles, Miami, Chicago and San Francisco. As a percentage of net revenues,

24

operating expenses decreased to 30.7% from 31.3% for the years ended December 31, 2002 and 2001, respectively.

        Wages, salaries and benefits increased by $9.6 million or 12.6% to $86.0 million for the year ended December 31, 2002 from $76.4 million for the same period in 2001. Wages, salaries and benefits for the year ended December 31, 2002 increased because of (a) start-up stations, which represent an increase of $2.8 million, (b) expenses related to the launch of HBCSi, which represent an increase of $2.0 million, (c) costs associated with increased ratings in Dallas, which represent an increase of $1.1 million, (d) group insurance in various markets, which represent an increase of $1.2 million, and (e) costs associated with the corporate office, which represent an increase of $0.6 million. As a percentage of net revenues, wages, salaries and benefits increased to 33.5% from 31.7% for the years ended December 31, 2002 and 2001, respectively.

        The provision for bad debts decreased $1.7 million or 39.5% to $2.6 million for the year ended December 31, 2002 from $4.3 million for the same period in 2001. The provision for bad debts decreased due to (a) uncollectability of certain notes receivable in 2001, which represented $0.5 million, and (b) decrease in bad debt expense in 2002 for stations in Los Angeles and Dallas, which represents a decrease of $1.0 million. As a percentage of net revenues, the provision for bad debts decreased to 1.0% from 1.8% for the years ended December 31, 2002 and 2001, respectively.

        Corporate expenses increased $7.2 million or 194.6% to $10.9 million for the year ended December 31, 2002 from $3.7 million for the same period in 2001. Included in corporate expenses are merger expenses of $5.1 million for the year ended December 31, 2002, related to the Company's pending merger with Univision and an increase in legal and professional fees unrelated to the pending merger. As a percentage of net revenues, corporate expenses increased to 4.2% from 1.5% for the years ended December 31, 2002 and 2001, respectively.

        Depreciation and amortization for the year ended December 31, 2002 decreased 66.2% to $12.3 million, compared to $36.4 million for the same period in 2001. The decrease is due to the adoption of SFAS No. 142, Goodwill and Other Intangible Assets. SFAS No. 142 requires that goodwill and intangible assets with indefinite useful lives no longer be amortized.

        Interest income (expense), net decreased to $0.6 million from $3.4 million for the years ended December 31, 2002 and 2001, respectively. The decrease for the year ended December 31, 2002 compared to the same period in 2001 was due to cash and cash equivalents and interest rates being higher in 2001 than in 2002.

        Other, net decreased to zero from $2.9 million for the year ended December 31, 2002 compared to 2001. The decrease was due to the gain from the sale of marketable equity securities in 2001 and a final arbitration award received by the Company in 2001.

        Federal and state income taxes are being provided at an effective rate of 39.5% and 39.2% for the years ended December 31, 2002 and 2001, respectively. The increase in the effective rate is due to merger expenses in 2002 which are not deductible for tax purposes.

        For the year ended December 31, 2002, the Company's net income totaled $40.2 million ($0.37 per common share) compared to $31.0 million ($0.28 per common share) in the same period in 2001.

        Our business was affected by general economic conditions, which were more favorable in 2002 than last year due to the events of September 11, 2001. The revenue growth of the Company was impacted by its Los Angeles operations, which experienced a net revenue decline of 5.8% for the year ended December 31, 2002 compared to last year due to increased competition. The Company's Los Angeles operations accounted for approximately 23.9% of total consolidated net revenues for the year ended December 31, 2002. The financial impact on the Company of the increased competition in Los Angeles has been partially offset by the Company's success in adding to its station line-up and

25

geographically diversifying its revenue streams over the last few years. Corporate expenses increased in the year of 2002 compared to the same period in 2001 primarily as a result of merger costs and higher legal and professional fees unrelated to the merger. The Company estimates that merger costs incurred in 2003 will approximate $14.0 million. Of that amount, approximately $10.7 million is attributable to investment banking fees and the reimbursement of out-of-pocket expenses.

Results of Operations for the Year Ended December 31, 2001 Compared to the Year Ended December 31, 2000

        The results of operations for the year ended December 31, 2001 are not comparable to the results of operations for the same period in 2000 primarily due to the acquisition of KLNO(FM) in Dallas on September 24, 1999 (the station operated under a time brokerage agreement until January 31, 2000 when the Company began programming the station in a Spanish-language format), the start-up of radio stations KRCD(FM) and KRCV(FM) in Los Angeles on January 31, 2000, the start-up of radio stations KCOR(FM) and KBBT(FM) in San Antonio on September 15, 2000 and September 29, 2000, respectively, the programming format changes on radio stations KDXX(AM/FM), KDXT(FM) and KDOS(FM) in Dallas on February 1, 2000 and KQBU(FM) in Houston on August 18, 2001, the acquisition of KOVE(FM) in Houston on July 20, 2001 and KOMR(FM), KMRR(FM), KKMR(FM) and KHOV(FM) in Phoenix on October 31, 2001, and the elimination of KTNQ(AM) in Los Angeles as a separately programmed radio station on January 1, 2001.

        Net revenues increased by $3.2 million or 1.3% to $240.8 million for the year ended December 31, 2001 from $237.6 million for the same period in 2000. Net revenues increased for the year ended December 31, 2001, compared to the same period in 2000 primarily because of (a) revenue growth in Dallas and San Diego, and on Houston and Phoenix stations that were not considered start-ups. The revenue growth was offset by a revenue decline in Chicago and on Los Angeles and San Antonio stations that were not considered start-ups or reformats, which collectively represent an increase of $3.0 million, and (b) revenues from start-up stations acquired or reformatted in 2000 and 2001, which represented an increase of $0.1 million.

        Operating expenses increased by $9.7 million or 14.8% to $75.4 million for the year ended December 31, 2001 from $65.7 million for the same period in 2000. Operating expenses increased for the year ended December 31, 2001, compared to the same period in 2000 primarily because of (a) promotion expenses to address direct competition in the key markets of Los Angeles, Chicago and Miami, which represented an increase of $4.1 million, (b) rent associated with the expansion of the Company's studio facilities in Los Angeles, San Francisco, Miami and New York, which represented an increase of $2.7 million, (c) trade expenses due to additional promotion campaigns for Los Angeles and Miami, which represented an increase of $0.8 million, and (d) an impairment loss on an investment, which represented an increase of $0.8 million. As a percentage of net revenues, operating expenses increased to 31.3% from 27.7% for the years ended December 31, 2001 and 2000, respectively.

        Wages, salaries and benefits increased by $6.4 million or 9.1% to $76.4 million for the year ended December 31, 2001 from $70.0 million for the same period in 2000. Wages, salaries and benefits increased for the year ended December 31, 2001, compared to the same period in 2000 primarily because of (a) additional personnel associated with start-up stations, which represented an increase of $4.6 million, (b) personnel costs associated with the programming changes in New York and Miami, which represented an increase of $2.2 million, (c) additional costs incurred to hire experienced sales personnel in Los Angeles and Houston, which represented an increase of $0.5 million, (d) higher staffing costs in the corporate office, which represented an increase of $0.6 million, (e) partially offset by a decrease in personnel costs associated with on-air talent in Los Angeles, which represented a decrease of $1.1 million, and (f) costs associated with decreased ratings in Chicago, which represented a decrease of $0.4 million. As a percentage of net revenues, wages, salaries and benefits increased to 31.7% from 29.5% for the years ended December 31, 2001 and 2000, respectively.

26

        The provision for bad debts increased by $0.5 million or 13.2% to $4.3 million for the year ended December 31, 2001 from $3.8 million for the same period in 2000. The provision for bad debts increased for the year ended December 31, 2001, compared to the same period in 2000 primarily because of the estimated uncollectability of certain notes receivable. As a percentage of net revenues, the provision increased to 1.8% from 1.6% for the years ended December 31, 2001 and 2000, respectively.

        Corporate expenses decreased by $0.2 million or 5.1% to $3.7 million for the year ended December 31, 2001, from $3.9 million for the same period in 2000. The decrease was primarily due to lower legal and professional fees in 2001. As a percentage of net revenues, corporate expenses decreased to 1.5% from 1.6% for the years ended December 31, 2001 and 2000, respectively.

        EBITDA for the year ended December 31, 2001 decreased $13.2 million or 14.0% to $81.0 million compared to $94.2 million for the same period in 2000. As a percentage of net revenues, EBITDA decreased to 33.6% from 39.6% for the years ended December 31, 2001 and 2000, respectively.

        Depreciation and amortization for the year ended December 31, 2001 increased $2.1 million to $36.4 million, compared to $34.3 million for the same period in 2000. The increase is due to the acquisitions of KOVE(FM) in Houston and KOMR(FM), KMRR(FM), KKMR(FM) and KHOV(FM) in Phoenix, and capital expenditures.

        Interest income, net decreased to $3.4 million from $7.1 million for the years ended December 31, 2001 and 2000, respectively. The decrease for the year ended December 31, 2001, compared to the same period in 2000 was due to cash and cash equivalents being higher in 2000 than in 2001 and lower interest rates in 2001.

        Other, net increased to $2.9 million for the year ended December 31, 2001, from $1.6 million in the same period in 2000. The increase was due to gains on the sales of securities and the final award received by the Company related to an arbitration proceeding.

        Federal and state income taxes are being provided at an effective rate of 39.2% and 39.5% for the years ended December 31, 2001 and 2000, respectively. The decrease in the effective rate is due to a lower effective state tax rate.

        For the year ended December 31, 2001, the Company's net income totaled $31.0 million ($0.28 per common share) compared to $41.5 million ($0.38 per common share) in the same period in 2000.

Liquidity and Capital Resources

        Net cash provided by operating activities for the year ended December 31, 2002 was $74.6 million as compared to $79.9 million for the same period in 2001. The $5.3 million decrease from 2001 to 2002 is due to merger expenses of $5.1 million being recognized in 2002 and changes in operating assets and liabilities. Net cash used in investing activities was $113.1 and $130.0 million for the years ended December 31, 2002 and 2001, respectively. The $16.9 million decrease from 2001 to 2002 is due to the Houston and Phoenix acquisitions in 2001 being an amount greater than the aggregate cost of the 2002 acquisitions in Las Vegas, Fresno, San Jose and Albuquerque. Net cash provided by financing activities was $19.1 and net cash used in financing activities was $6.0 million for the years ended December 31, 2002 and 2001, respectively. The $25.1 million increase from 2001 to 2002 is due to a $15.0 million borrowing from the Credit Facility in 2002 and the purchase of $10.1 million of Class A Common Stock by the Company in 2001.

        The Company paid $101.7 and $114.1 million for radio station acquisitions for the years ended December 31, 2002 and 2001, respectively. These acquisitions were funded with available cash, except $15.0 million of the 2002 amount was funded with an amount borrowed from the Credit Facility.

27

        Generally, the Company's capital expenditures are made with cash provided by operations. Capital expenditures totaled $11.5 and $14.3 million for the years ended December 31, 2002 and 2001, respectively. Approximately $4.3 million of the capital expenditures incurred during the year ended December 31, 2002 related to radio signal upgrade projects for three different radio stations in Dallas and Houston, transmitter projects in San Francisco, Phoenix, San Antonio, Miami, New York, Chicago, McAllen and Los Angeles, and the build-out of studio and office space in Las Vegas, Phoenix, Dallas, Fresno, Albuquerque, San Francisco, Los Angeles, Miami and Houston compared to $10.0 million incurred in the same period of 2001 related to radio signal upgrade projects affecting five different radio stations in Houston and Dallas and the build-out of studio and office space in Los Angeles, San Francisco, New York, Miami, Phoenix and San Antonio.

        The short-term liquidity needs of the Company are $151.2 million which is the sum of current liabilities, excluding the current portion of long-term obligations, and the current portion of long-term obligations as shown in the table below. The long-term liquidity needs of the Company are shown in the table below.

        Available cash on hand plus cash flow provided funds available under lines of credit by operations was sufficient to fund the Company's operations, meet its debt obligations, and to fund capital expenditures. Management believes the Company will have sufficient cash on hand and cash provided by operations to finance its operations, satisfy its debt service requirements, and to fund capital expenditures. Management regularly reviews potential acquisitions. Future acquisitions will be financed primarily through proceeds from borrowings under the Credit Facility, available cash on hand, and proceeds from securities offerings.

        The Company expects to terminate the Credit Facility after the merger with Univision has been completed. Upon termination of the Credit Facility, Univision will pay the outstanding borrowings, if any, and the Company will fund future capital needs through Univision.

Stockholders' Equity

        In 2001, the Company purchased 685,500 shares of its Class A Common Stock at a weighted average price per share of $14.75.

Material Contractual Obligations

        The scheduled maturities of long-term obligations, future minimum rental payments under noncancellable operating leases and radio station acquisition commitments of the Company as of December 31, 2002 are as follows (in thousands):

	Payments Due by Period
	Total		Less than 1 year		1-3 years		4-5 years		After 5 years
Long-term obligations	$	16,436	$	15,007	$	16	$	19	$	1,394
Operating leases		78,027		8,742		15,957		12,932		40,396
Radio station acquisitions		105,000		105,000		—		—		—
Total contractual cash obligations	$	199,463	$	128,749	$	15,973	$	12,951	$	41,790

        The Company borrowed $15.0 million from the Credit Facility on April 1, 2002. For the year ended December 31, 2001, no amount was borrowed or outstanding on the Credit Facility. As of December 31, 2002, the Company had $165.0 million of credit available under the Credit Facility. Borrowings under the Credit Facility bear interest at a rate based on LIBOR plus an applicable margin as determined by the Company's leverage ratio. The Credit Facility is secured by the stock of the Company's subsidiaries. Availability under the Credit Facility reduces quarterly commencing September 30, 1999 and ending December 31, 2004. Our ability to make additional borrowings under

28

the Credit Facility is subject to compliance with certain financial ratios and other conditions set forth in the Credit Facility.

Recently Issued Accounting Pronouncements

        In April 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections. SFAS No. 145 rescinds FASB Statement No. 4, Reporting Gains and Losses from Extinguishment of Debt and requires recognition of gain or loss on extinguishment of debt to income or loss from continuing operations in the financial statements. The Company is required to adopt the provisions of SFAS No. 145 effective January 1, 2003. Management does not believe adoption of this statement will materially impact the Company's financial position or results of operations.

Critical Accounting Policies

        Critical accounting policies are defined as those that are reflective of significant judgments and uncertainties, and potentially result in materially different results under different assumptions and conditions. The Company believes that its critical accounting policies are limited to those described below.

Impairment of Long-Lived Assets

        The Company records impairment losses when events and circumstances indicate that long-lived assets might be impaired and the undiscounted cash flow estimated to be generated by those assets is less than the carrying amount of those assets. When specific assets are determined to be impaired, the cost basis of the assets is reduced to reflect their current fair market value.

        We performed a recoverability assessment of all of our long-lived assets using an undiscounted cash flow model as of December 31, 2002. Based on our assumptions, all long-lived assets were determined to be recoverable.

Revenue Recognition

        Our revenue is derived primarily from the sale of advertising time to local and national advertisers. We recognize revenue as commercials are broadcast. Revenues from barter transactions are recognized as income when commercials are broadcast. Barter transactions are recorded at the estimated fair value of the goods or services received.

Allowance For Doubtful Accounts

        The allowance for doubtful accounts is estimated using a combination of the aging of the accounts receivable balances and knowledge related to the ability of the Company to collect specific accounts. Older accounts receivable are seen to be less likely to be collected and require a greater allowance. Specific accounts which are estimated to not be collected increase the allowance.

Impairment of Indefinite-Lived Intangible Assets or Cost In Excess of Fair Value of Net Assets Acquired

        The Company records impairment losses when events and circumstances indicate that indefinite-lived intangible assets or cost in excess of fair value of net assets acquired might be impaired. The reporting unit is defined as an individual radio market. To the extent a reporting unit's carrying amount exceeds its fair value, the reporting unit's indefinite-lived intangible assets or cost in excess of fair value of net assets acquired may be impaired and we perform the second step of the impairment test. In the second step, we compare the implied fair value of the reporting unit's indefinite-lived intangible assets

29

or cost in excess of fair value of net assets acquired, determined by allocating the reporting unit's fair value to all of its assets (recognized and unrecognized) and liabilities in a manner similar to a purchase price allocation in accordance with SFAS No. 141, to its carrying amount, both of which are measured as of the end of the year. When the indefinite-lived intangible assets or cost in excess of fair value of net assets acquired is determined to be impaired, the basis of the assets is reduced to reflect the implied fair value. We performed an impairment assessment of the indefinite-lived intangible assets or cost in excess of fair value of net assets acquired as of January 1, 2002 and December 31, 2002 and determined there was no impairment.

Income Taxes

        Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date.

        For additional information on our significant accounting policies, see Note 1 to our accompanying consolidated financial statements.

Inflation

        Inflation has affected our financial performance due to higher operating expenses. Although the exact impact of inflation is indeterminable, we have offset these higher costs by increasing the effective advertising rates of most of our radio stations.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        The Company is subject to interest rate risk on both the interest earned on cash and cash equivalents and interest paid on borrowings under the Credit Facility. A change of 10% in the interest rate earned on short-term investments and interest paid under the Credit Facility would not have had a significant impact on our historical financial statements.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Financial Statements

	Page Number
Independent Auditors' Report	32
Consolidated Balance Sheets as of December 31, 2002 and 2001	33
Consolidated Statements of Income and Comprehensive Income for the Years Ended December 31, 2002, 2001 and 2000	34
Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 2002, 2001 and 2000	35
Consolidated Statements of Cash Flows for the Years Ended December 31, 2002, 2001 and 2000	36
Notes to Consolidated Financial Statements	37

31

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Hispanic Broadcasting Corporation:

        We have audited the accompanying consolidated balance sheets of Hispanic Broadcasting Corporation and subsidiaries (the "Company") as of December 31, 2002 and 2001 and the related consolidated statements of income and comprehensive income, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2002. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedule included at Item 14(a) (2). These consolidated financial statements and financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedule based on our audits.

        We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

        In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Hispanic Broadcasting Corporation and subsidiaries as of December 31, 2002 and 2001 and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2002, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

        As discussed in Note 1 to the consolidated financial statements, the Company adopted the provisions of Statement of Financial Accounting Standards ("SFAS") No. 141, Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets.

KPMG LLP

Dallas, Texas
February 23, 2003, except for Note 2 which is as of March 17, 2002

32

HISPANIC BROADCASTING CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands except share information)

ASSETS

			December 31,
			2002			2001
Current assets:
	Cash and cash equivalents		$	40,217		$	59,587
	Accounts receivable, net of allowance of $2,669 in 2002 and $3,458 in 2001			51,935			50,241
	Prepaid expenses and other current assets			1,131			748
		Total current assets		93,283			110,576
Property and equipment, net of accumulated depreciation and amortization				55,837			54,428
Cost in excess of fair value of net assets acquired net of accumulated amortization of $12,380 in 2002 and 2001				85,245			85,245
Intangible assets, net of accumulated amortization				1,080,845			938,155
Restricted cash				—			3,151
Deferred charges and other assets				10,578			50,188
		Total assets	$	1,325,788		$	1,241,743
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Accounts payable		$	4,780		$	4,700
	Accrued expenses			15,391			15,968
	Income taxes payable			2,298			3,349
	Current portion of long-term obligations			7			6
		Total current liabilities		22,476			24,023
Long-term obligations, less current portion				16,429			1,418
Deferred income taxes				143,323			119,486
Minority interest				1,341			—
Commitments and contingencies (Note 11)
Stockholders' equity:
	Preferred Stock, cumulative, $.001 par value; authorized 5,000,000 shares; no shares issued or outstanding			—			—
	Class A Common Stock, $.001 par value; authorized 175,000,000 shares in 2002 and 2001; issued 81,201,689 shares and outstanding 80,516,189 shares in 2002 and issued 80,923,786 shares and outstanding 80,238,286 shares in 2001			81			81
	Class B Common Stock, convertible, $.001 par value; authorized 50,000,000 shares; issued and outstanding 28,312,940 shares			28			28
	Additional paid-in capital			1,048,097			1,042,907
	Retained earnings			104,121			63,908
	Treasury stock, at cost, 685,500 shares			(10,108	)		(10,108	)
		Total stockholders' equity		1,142,219			1,096,816
		Total liabilities and stockholders' equity	$	1,325,788		$	1,241,743

See accompanying notes to consolidated financial statements.

33

HISPANIC BROADCASTING CORPORATION AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


(in thousands except per share data)

			Year Ended December 31,
			2002			2001			2000
Revenues			$	292,384		$	274,314		$	270,339
Agency commissions				35,839			33,539			32,785
Net revenues				256,545			240,775			237,554
Operating expenses				78,768			75,399			65,741
Wages, salaries and benefits				85,955			76,363			69,985
Provision for bad debts				2,633			4,289			3,757
Depreciation and amortization				12,267			36,415			34,264
Corporate expenses				10,992			3,718			3,879
Operating income				65,930			44,591			59,928
Other income (expense):
	Interest income			1,585			3,852			7,897
	Interest expense			(1,028	)		(403	)		(819	)
	Other, net			—			2,871			1,585
				557			6,320			8,663
Income before income tax				66,487			50,911			68,591
Income tax				26,274			19,942			27,060
Net income			$	40,213		$	30,969		$	41,531
Net income per common share:
	Basic and diluted		$	0.37		$	0.28		$	0.38
Weighted average common shares outstanding:
	Basic			108,723			108,872			108,858
	Diluted			109,543			109,617			110,388
Comprehensive income:
	Net income		$	40,213		$	30,969		$	41,531
	Other comprehensive income, net of tax:
		Unrealized gain on marketable equity securities (net of tax of $268)		—			418			—
		Reclassification adjustment for gains included in net income (net of tax of $268)		—			(418	)		—
Comprehensive income			$	40,213		$	30,969		$	41,531

See accompanying notes to consolidated financial statements.

34

HISPANIC BROADCASTING CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands except share information)

				Common Stock							Retained earnings (accumulated deficit)						Accummulated other comprehensive income
		Preferred Stock						Additional paid-in capital						Treasury stock
				Class A		Class B														Total
Balance at December 31, 1999		$	—	$	40	$	14	$	1,034,791		$	(8,592	)	$	—		$	—		$	1,026,253
Net proceeds from issuance of 149,111 shares of Class A Common Stock			—		—		—		2,324			—			—			—			2,324
Two-for-one stock split			—		41		14		(55	)		—			—			—			—
Tax benefit of stock options exercised			—		—		—		653			—			—			—			653
Options issued to non employees for services			—		—		—		242			—			—			—			242
Net income			—		—		—		—			41,531			—			—			41,531
Balance at December 31, 2000			—		81		28		1,037,955			32,939			—			—			1,071,003
Proceeds from issuance of 278,435 shares of Class A Common Stock			—		—		—		4,094			—			—			—			4,094
Purchase of 685,500 shares of Class A Common Stock			—		—		—		—			—			(10,108	)		—			(10,108	)
Tax benefit of stock options exercised			—		—		—		729			—			—			—			729
Options issued to non employees for services			—		—		—		129			—			—			—			129
Net income			—		—		—		—			30,969			—			—			30,969
Other comprehensive income:
	Unrealized gain on marketable equity securities (net of tax of $268)		—		—		—		—			—			—			418			418
	Reclassification adjustment for gains included in net income (net of tax of $268)		—		—		—		—			—			—			(418	)		(418	)
Total comprehensive income			—		—		—		—			—			—			—			30,969
Balance at December 31, 2001			—		81		28		1,042,907			63,908			(10,108	)		—			1,096,816
Proceeds from issuance of 277,903 shares of Class A Common Stock			—		—		—		4,065			—			—			—			4,065
Tax benefit of stock options exercised			—		—		—		984			—			—			—			984
Options issued to non employees for services			—		—		—		141			—			—			—			141
Net income			—		—		—		—			40,213			—			—			40,213
Balance at December 31, 2002		$	—	$	81	$	28	$	1,048,097		$	104,121		$	(10,108	)	$	—		$	1,142,219

See accompanying notes to consolidated financial statements.

35

HISPANIC BROADCASTING CORPORATION AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF CASH FLOWS


(in thousands)

					Year Ended December 31,
					2002			2001			2000
Cash flows from operating activities:
	Net income				$	40,213		$	30,969		$	41,531
	Adjustments to reconcile net income to net cash provided by operating activities:
		Provision for bad debts				2,633			4,289			3,757
		Depreciation and amortization				12,267			36,415			34,264
		Minority interest				(16	)		—			—
		Amortization of debt facility fee included in interest expense				156			156			162
		Deferred income taxes				23,837			9,620			7,960
		Changes in operating assets and liabilities:
			Accounts receivable, net			(3,311	)		(5,315	)		(12,533	)
			Prepaid expenses and other current assets			(383	)		163			(61	)
			Accounts payable			58			1,502			1,988
			Accrued expenses			(577	)		637			(2,698	)
			Income taxes payable			(67	)		2,340			(4,369	)
			Other, net			(185	)		(898	)		842
				Net cash provided by operating activities		74,625			79,878			70,843
Cash flows from investing activities:
	Acquisitions of radio stations					(96,998	)		(114,129	)		(120,152	)
	Cash deposited in restricted cash account related to the Fresno Acquisition, the San Jose Acquisition and the Albuquerque Acquisition					(1,250	)		(3,151	)		—
	Property and equipment acquisitions					(11,495	)		(14,344	)		(11,007	)
	Dispositions of property and equipment					923			35			111
	Additions to intangible assets					(1,835	)		(143	)		(653	)
	Increase in deferred charges and other assets					(2,400	)		(6,842	)		(40,813	)
	Proceeds from the sale of securities included in deferred charges and other assets					—			8,611			—
				Net cash used in investing activities		(113,055	)		(129,963	)		(172,514	)
Cash flows from financing activities:
	Borrowings on long-term obligations					15,000			—			—
	Payments on long-term obligations					(6	)		(3	)		(120	)
	Proceeds from stock issuances					4,066			4,094			2,344
	Purchase of treasury stock					—			(10,108	)		—
				Net cash provided by (used in) financing activities		19,060			(6,017	)		2,224
Net decrease in cash and cash equivalents						(19,370	)		(56,102	)		(99,447	)
Cash and cash equivalents at beginning of year						59,587			115,689			215,136
Cash and cash equivalents at end of year					$	40,217		$	59,587		$	115,689

See accompanying notes to consolidated financial statements.

36

HISPANIC BROADCASTING CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies

Organization

        Hispanic Broadcasting Corporation (the "Company"), through its subsidiaries, owns and operates 62 Spanish-language and other Hispanic-targeted radio stations serving in 15 of the top 25 markets throughout the United States (Los Angeles, New York City, Miami, Chicago, Houston, San Francisco/San Jose, Dallas/Fort Worth, San Antonio, McAllen/Brownsville/Harlingen, Phoenix, San Diego, El Paso, Fresno, Las Vegas and Albuquerque). The Company also owns and operates HBC Sales Integration, which is one of the largest Spanish-language radio broadcast networks in the United States in terms of audience delivery and HBCi which operates the Company's radio station Internet websites.

Basis of Consolidation

        The accompanying consolidated financial statements include the accounts of Hispanic Broadcasting Corporation and its wholly-owned subsidiaries. The Company consolidates the accounts of subsidiaries when it has a controlling financial interest (over 50%) in the outstanding voting shares of the subsidiary.

        All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

        The preparation of financial statements in conformity with generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and related notes to the consolidated financial statements. Actual results could differ from those estimates.

Cash Equivalents

        Cash and cash equivalents include all highly liquid investments with an original maturity of three months or less.

Restricted Cash

        Restricted cash is legally restricted cash held in escrow accounts for pending acquisitions.

Investments

        The Company uses the equity method to account for investments when it does not have a controlling interest but has the ability to exercise significant influence over the operating and/or financial decisions of the investee. Investments where the Company does not exert significant influence are accounted for using the cost method. Investments at December 31, 2002 and 2001 (included in deferred charges and other assets) consist of interests in entities which are involved in radio broadcasting and the ownership of transmission towers.

Property and Equipment

        Property and equipment are recorded at cost. Expenditures for significant renewals and betterments are capitalized. Repairs and maintenance are charged to expense as incurred. Gains or

37

losses from disposition of property and equipment are recognized in the statement of income and comprehensive income.

        Depreciation is provided in amounts sufficient to relate the asset cost to operations over the estimated useful lives on a straight-line basis. Leasehold improvements are depreciated over the remaining life of the lease or the estimated service life of the asset, whichever is shorter. The estimated useful lives are as follows:

Land improvements	15 years
Buildings and improvements	3 - 40 years
Broadcast and other equipment	2 - 30 years
Furniture and fixtures	2 - 10 years

Intangible Assets

        In 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") No. 142, Goodwill and Other Intangible Assets. SFAS No. 142 requires that goodwill and intangible assets with indefinite useful lives no longer be amortized and to be tested for impairment at least annually in accordance with the provisions of SFAS No. 142. The Company adopted the provisions of SFAS No. 142 on July 1, 2001 and January 1, 2002 for intangible assets acquired in business combinations completed after June 30, 2001 and prior to July 1, 2001, respectively.

        On January 1, 2002, we were required by SFAS No. 142 to reassess the useful lives of all intangible assets acquired on or before June 30, 2001, and make any necessary remaining amortization period adjustments by March 31, 2002. No remaining amortization period adjustments were necessary. In addition, to the extent that an intangible asset is identified as having an indefinite useful life, we are required to perform a transitional test to determine if there is an asset impairment in accordance with the provisions of SFAS No. 142. Any impairment loss is measured as of January 1, 2002 and recognized as the cumulative effect of a change in accounting principle in the six months ended June 30, 2002.

        In connection with the transitional impairment evaluation, SFAS No. 142 requires us to perform an assessment of whether there is an indication that indefinite-lived intangible assets or cost in excess of fair value of net assets acquired is impaired as of January 1, 2002. To accomplish this, we identified the reporting units and determined the carrying value of each reporting unit. The Company defines its reporting unit to be an individual radio market. To the extent a reporting unit's carrying amount exceeds its fair value, the reporting unit's cost in excess of fair value of net assets acquired may be impaired and we must perform the second step of the transitional impairment test. In the second step, we must compare the implied fair value of the reporting unit's cost in excess of fair value of net assets acquired, determined by allocating the reporting unit's fair value to all of its assets (recognized and unrecognized) and liabilities in a manner similar to a purchase price allocation in accordance with SFAS No. 141, to its carrying amount, both of which would be measured as of January 1, 2002. Any transitional impairment loss is recognized as the cumulative effect of a change in accounting principle in our statement of income. No impairment loss was recognized for the year ended December 31, 2002 as a result of the transitional test discussed above.

        The Company also performed an assessment of whether there is an indication that cost in excess of fair value of net assets acquired is impaired as of December 31, 2002. The same valuation methodology was followed as was previously discussed related to the transitional impairment test. No impairment loss was recognized for the year ended December 31, 2002 as a result of this test.

        Intangible assets are recorded at cost. Amortization of intangible assets is provided in amounts sufficient to charge the asset cost to operations over the estimated useful lives on a straight-line basis. Broadcast licenses, cost in excess of fair value of net assets acquired and certain other intangible assets have indefinite useful lives and are not subject to amortization for the year ended December 31, 2002.

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The estimated useful lives of other intangible assets with definite useful lives is 3 to 40 years. For the years ended December 31, 2001 and 2000, intangible assets acquired prior to July 1, 2001 are subject to amortization. The estimated useful lives are as follows:

Broadcast licenses	40 years
Cost in excess of fair value of net assets acquired	principally 40 years
Other intangible assets	3 - 40 years

        As of December 31, 2001 and 2000, the Company evaluated the propriety of the carrying amount of intangible assets, including cost in excess of fair value of net assets acquired, as well as the amortization period to determine whether current events or circumstances warrant adjustments to the carrying value and/or revised estimates of useful lives. This evaluation consisted of the projection of undiscounted income before depreciation, amortization, and interest for each of the Company's radio stations over the remaining estimated useful life of the broadcast licenses. If such projections indicated that undiscounted cash flows were not expected to be adequate to recover the carrying amounts of the related intangible assets, a loss is recognized to the extent the carrying amount of the asset exceeds its fair value. The Company believes that no impairment of cost in excess of fair value of net assets acquired and other intangible assets has occurred and that no reduction of the estimated useful lives was warranted.

Revenue Recognition

        Revenue is derived primarily from the sale of advertising time to local and national advertisers. Revenue is recognized as commercials are broadcast.

Advertising Costs

        The Company incurs various marketing and promotional costs to add and maintain listenership. These costs are charged to expense in the year incurred and totaled approximately $9.9, $9.5 and $5.7 million for the years ended December 31, 2002, 2001 and 2000, respectively.

Barter Transactions

        Barter transactions represent advertising time exchanged for promotional items, advertising, supplies, equipment and services. Barter transactions are recorded at the estimated fair value of the goods or services received. Revenues from barter transactions are recognized as income when commercials are broadcast. Expenses are recognized when goods or services are received or used. Barter transactions are not significant to the Company's consolidated financial statements.

Income Taxes

        Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date.

Earnings Per Share

        Basic earnings per common share is based on net earnings after preferred stock dividend requirements, if any, and the weighted average number of common shares outstanding during each year. Diluted earnings per common share reflects the incremental increase in the weighted average

39

number of common shares due to the dilutive effect of stock options and the Employee Stock Purchase Plan.

Financial Instruments

        The carrying amounts of financial instruments, including cash and cash equivalents, accounts receivable and payable, approximate fair value due to the relatively short maturity of these instruments. The carrying amount of long-term obligations, including the current portion, approximates fair value based upon quoted interest rates for the same or similar debt issues.

Credit Risk

        In the opinion of management, credit risk with respect to accounts receivable is limited due to the large number of diversified customers and the geographic diversification of the Company's customer base. The Company performs ongoing credit evaluations of its customers and believes that adequate allowances for uncollectible accounts receivable are maintained.

Stock Based Compensation

        The Company accounts for stock options issued to employees and directors using the intrinsic-value method as outlined under Accounting Principles Board Opinion No. 25 ("APB 25"), Accounting for Stock Issued to Employees and related interpretations including FASB Interpretation No. 44, Accounting for Certain Transactions involving Stock Compensation (an interpretation of APB Opinion No. 25), issued March 2000, to account for its fixed plan stock options.

        Under APB 25, the Company does not recognize compensation expense related to employee stock options since options are not granted at a price below the market value of the underlying common stock on the date of grant. In accordance with Statement of Financial Accounting Standards ("SFAS") No. 123, Accounting for Stock-Based Compensation, and Emerging Issues Task Force No. 96-18 Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services, the Company includes in operating expenses in the statement of income and comprehensive income, the cost of stock options (calculated using the fair-value method) issued to persons who are not employees or directors.

        For purposes of pro forma disclosures, the estimated fair value of the options is expensed over the options' vesting period. Pro forma net income and earnings per share disclosures as if the Company recorded compensation expense based on the fair value for stock-based awards have been presented in accordance with the provisions of SFAS No. 148, Accounting for Stock-Based Compensation—Transition and Disclosure, and are as follows (in thousands, except per share information):

		Year Ended December 31,
		2002			2001			2000
Net income as reported		$	40,213		$	30,969		$	41,531
Stock-based employee compensation expense, net of related tax effects, included in net income as reported			56			51			95
Stock-based employee compensation expense determined under fair value-based method, net of related tax effects			(9,959	)		(8,937	)		(7,905	)
Pro forma net income		$	30,310		$	22,083		$	33,721
Net income per common share:
	As reported—basic and diluted	$	0.37		$	0.28		$	0.38
	Pro forma—basic and diluted	$	0.28		$	0.20		$	0.31

40

        The weighted average fair value at date of grant for options granted in the years ended December 31, 2002, 2001 and 2000 was $13.91, $12.62 and $16.46 per share, respectively. The fair value of these options was estimated on the date of the grant using the Black-Scholes option pricing model with the following assumptions:

	2002		2001		2000
Risk free interest rate	3.76	%	4.57	%	5.96	%
Dividend yield	0.00	%	0.00	%	0.00	%
Volatility factor	58.61	%	59.42	%	57.82	%
Weighted average expected life	6 years		6 years		6 years

Comprehensive Income

        SFAS No. 130, Reporting Comprehensive Income, establishes guidelines for the reporting and display of comprehensive income and its components in financial statements. Comprehensive income includes unrealized gains on equity securities classified as available-for-sale and included as a component of stockholders' equity.

New Accounting Pronouncements

        In 2001, the Financial Accounting Standards Board issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS No. 144 supersedes SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of. SFAS No. 144 retains the requirements of SFAS No. 121 to (a) recognize an impairment loss only if the carrying amount of a long-lived asset is not recoverable from its undiscounted cash flows and (b) measure an impairment loss as the difference between the carrying amount and fair value of the assets. The statement also removes goodwill from its scope and covers the accounting for the disposal of long-lived assets. The Company adopted the provisions of SFAS No. 144 on January 1, 2002.

2. Pending Merger

        On June 11, 2002, the Company agreed to merge with Univision. Univision will acquire the Company in an all-stock transaction. In the merger, the stockholders of the Company will exchange each share of their capital stock in the Company for the right to receive 0.85 share of the Class A common stock of Univision. The boards of directors of both companies approved the merger, the stockholders of each company voted in favor of the merger on February 28, 2003, and the DOJ, Univision and the Company have reached an agreement regarding the merger. The merger is subject to approval by the FCC and customary closing conditions. The Company expects that the merger will close in April 2003.

        Included in corporate expenses are merger expenses of $5.1 million for the year ended December 31, 2002. The Company estimates that merger costs incurred in 2003 will approximate $14.0 million.

3. Related Party Transactions

        Clear Channel Communications, Inc. ("Clear Channel") owns all the outstanding shares of the Company's Class B common stock, which accounts for approximately 26.0% of the Company's common stock. Transactions with Clear Channel are consummated on terms similar to those with unrelated parties. The Company earned revenues from transactions with Clear Channel related to the sale of airtime, rental of space on transmission towers and other miscellaneious transactions. Expenses were incurred by the Company from transactions with Clear Channel related to national representation fees, rental of space on transmission towers, outdoor advertising and other miscellaneous transactions. The

41

net expense from these transactions is $3.8, $6.7 and $2.6 million for the years ended December 31, 2002, 2001 and 2000, respectively.

        A director of the Company, Mr. Ernesto Cruz, is employed by Credit Suisse First Boston, Inc. ("CSFB") which provides the Company with investment banking services. The Company paid this firm $2.0 million in fees for investment banking services related to the merger for the year ended December 31, 2002.

4. Acquisitions and Radio Signal Upgrades

2002 Acquisitions and Radio Signal Upgrades

        On August 10, 2001, the Company entered into an asset purchase agreement to acquire for $16.0 million the assets of KQMR(FM), serving the Las Vegas market (the "Las Vegas Acquisition"). On March 22, 2002, the Company closed on the Las Vegas Acquisition. The Company used its available cash to fund the acquisition.

        The fair value of the assets acquired in the Las Vegas Acquisition as of March 22, 2002 is as follows (in thousands):

Broadcast and other equipment	$	26
Broadcast licenses		15,952
Other intangible assets		57
	$	16,035

        On October 10, 2001, the Company entered into an asset purchase agreement to acquire for $5.0 million the assets of KZOL(FM), serving the Fresno market (the "Fresno Acquisition"). On March 29, 2002, the Company closed on the Fresno Acquisition. The Company used its available cash to fund the acquisition.

        The fair value of the assets acquired in the Fresno Acquisition as of March 29, 2002 is as follows (in thousands):

Broadcast and other equipment	$	88
Furniture and fixtures		2
Broadcast licenses		4,898
Other intangible assets		34
	$	5,022

        On December 17, 2001, the Company entered into an asset purchase agreement to acquire for $58.0 million the assets of KEMR(FM) (formerly KSOL(FM)), serving the San Jose and San Francisco markets (the "San Jose Acquisition"). On April 1, 2002, the Company closed on the San Jose Acquisition. The Company used its available cash to fund the acquisition along with $15.0 million borrowed from the $180.0 million revolving credit facility (the "Credit Facility") on April 1, 2002.

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        The fair value of the assets acquired in the San Jose Acquisition as of April 1, 2002 is as follows (in thousands):

Land and improvements	$	99
Buildings and improvements		57
Broadcast and other equipment		246
Furniture and fixtures		13
Broadcast licenses		57,412
Other intangible assets		464
	$	58,291

        On August 26, 2002, the Company entered into an asset purchase agreement to acquire for $22.5 million the assets of KJFA(FM), KIOT(FM), KVVF(FM), KKSS(FM) and KAJZ(FM), serving the Albuquerque market (the "Albuquerque Acquisition"). On November 1, 2002, the Company closed on the Albuquerque Acquisition. The Company used its available cash to fund the acquisition.

        The fair value of the assets acquired in the Albuquerque Acquisition as of November 1, 2002 is as follows (in thousands):

Land and improvements	$	132
Buildings and improvements		412
Broadcast and other equipment		1,074
Furniture and fixtures		94
Broadcast licenses		20,431
Other intangible assets		244
	$	22,387

        The intangible assets acquired in the Las Vegas Aquisition, the Fresno Acquisition, the San Jose Acquisition and the Albuquerque Acquisition are not subject to amortization.

        Radio stations KPTY(FM) in Houston and KESS(FM) (formerly KDXX(FM)) and KDXX(FM) (formerly KDXT(FM)) in Dallas have been involved in a variety of proceedings before the Federal Communications Commission to improve each of the stations' signal coverage. The radio signal upgrade projects for KPTY(FM) in Houston and KESS(FM) in Dallas were substantially completed in February 2002 and the stations began broadcasting according to their new authorized signal authority. The upgrade costs of $35.0 million incurred by the Company and included in deferred charges and other assets were reclassified to intangible assets during 2002. The radio signal upgrade project for KDXX(FM) in Dallas was substantially completed in July 2002 and the station began broadcasting according to its new authorized signal authority. The upgrade costs of $2.6 million incurred by the Company and included in deferred charges and other assets were reclassified to intangible assets during 2002 and are not subject to amortization.

2001 Acquisitions

        On April 24, 2001, the Company entered into an asset purchase agreement to acquire for $80.0 million the FCC licenses of a radio station broadcasting at 106.5 MHz (KOVE(FM)), serving the Houston market (the "Houston Acquisition"). The Houston Acquisition closed on July 20, 2001. The asset acquisition was funded with available cash.

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        The fair value of the assets acquired in the Houston Acquisition as of July 20, 2001 is as follows (in thousands):

Land and improvements	$	164
Buildings and improvements		1,436
Broadcast and other equipment		428
Broadcast licenses		77,863
Other intangible assets		173
	$	80,064

        On September 4, 2001, the Company entered into an asset purchase agreement to acquire for $34.0 million the assets of KOMR(FM), KMRR(FM), KKMR(FM) and KHOV(FM), serving the Phoenix market (the "Phoenix Acquisition"). The Phoenix Acquisition closed on October 31, 2001. The asset acquisition was funded with available cash.

        The fair value of the assets acquired in the Phoenix Acquisition as of October 31, 2001 is as follows (in thousands):

Prepaid expenses and other current assets	$	24
Land and improvements		17
Buildings and improvements		352
Broadcast and other equipment		1,635
Furniture and fixtures		48
Broadcast licenses		31,708
Other intangible assets		282
	$	34,066

        The intangible assets acquired in the Houston Acquisition and the Phoenix Acquisition are not subject to amortization.

2000 Acquisitions

        On October 15, 1999, the Company entered into an asset purchase agreement to acquire for $75.0 million the assets of KRCD(FM) and KRCV(FM), serving the Los Angeles market (the "Los Angeles Acquisition"). The Los Angeles Acquisition closed on January 31, 2000. The asset acquisition was funded with a portion of the proceeds from the November 1999 secondary public stock offering (the "November 1999 Offering"). The stations' programming was converted to a single Spanish-language format in February 2000.

        On May 31, 2000, the Company entered into an asset purchase agreement to acquire for $45.0 million the assets of KCOR(FM) and KBBT(FM), serving the San Antonio market. The KCOR(FM) and KBBT(FM) acquisitions closed on September 15, 2000 and September 29, 2000, respectively. The asset acquisitions were funded with a portion of the proceeds from the November 1999 Offering. The stations' programming was converted to separate Hispanic-targeted formats.

Pending Transactions

        On January 2, 2003, the Company entered into an agreement to acquire for approximately $32.9 million the assets of WVIV(FM) (formerly WXXY(FM)), serving the Chicago market (the

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"Chicago Acquisition"). The Chicago Acquisition is subject to regulatory approvals and customary closing conditions. The Company expects to close on the Chicago Acquisition during the second quarter of 2003. The Company plans to use its available cash to fund the acquisition along with borrowings from the Credit Facility.

        On February 13, 2003, the Company entered into an agreement to acquire for $32.0 million the stock of a company which owns and operates WKAQ(FM), WKAQ(AM), WUKQ(FM) and WUKQ(AM), serving the Puerto Rico market (the "Puerto Rico Acquisition"). The Puerto Rico Acquisition is subject to regulatory approvals and customary closing conditions. The Company expects to close on the Puerto Rico Acquisition during the second quarter of 2003 and plans to borrow from the Credit Facility to fund the acquisition.

        On March 3, 2003, the Company entered into an agreement to acquire for $24.0 million the assets of KNGT(FM), serving the Sacramento market and a tower located near Dallas, Texas (the "Sacramento Acquisition"). The Sacramento Acquisition is subject to regulatory approvals and customary closing conditions. The Company expects to close on the Sacramento Acquisition during the second quarter of 2003. The Company plans to borrow from the Credit Facility to fund the acquisition.

        On March 17, 2003, the Company entered into an agreement to acquire for $16.0 million the assets of KTND(FM), serving the Austin market (the "Austin Acquisition"). The Austin Acquisition is subject to regulatory approvals and customary closing conditions. The Company expects to close on the Austin Acquisition during the third quarter of 2003. The Company plans to borrow from the Credit Facility to fund the acquisition.

Pro forma Information

        Unaudited pro forma results of operations for the years ended December 31, 2002 and 2001, calculated as though the Houston Acquisition, the Phoenix Acquisition, the Las Vegas Acquisition, the Fresno Acquisition, the San Jose Acquisition, the Albuquerque Acquisition, the Chicago Acquisition, the Puerto Rico Acquisition, the Sacremento Acquisition and the Austin Acquisition had occurred at the beginning of each year, is as follows (in thousands, except per share data):

		Pro forma Year Ended December 31,
		2002		2001
Net revenues		$	274,139	$	265,717
Operating income			66,209		44,663
Net income			38,242		26,815
Net income per common share:
	Basic		0.35		0.25
	Diluted		0.35		0.24

        The pro forma information is presented for comparative purposes only and does not purport to be indicative of what would have occurred had the acquisitions actually been made at such dates, nor is it indicative of future operating results.

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5. Property and Equipment

        Property and equipment consists of the following (in thousands):

	December 31,
	2002		2001
Land and improvements	$	13,133	$	10,790
Buildings and improvements		19,295		17,622
Broadcast and other equipment		56,322		49,794
Furniture and fixtures		18,980		16,642
		107,730		94,848
Less accumulated depreciation and amortization		51,893		40,420
	$	55,837	$	54,428

6. Intangible Assets

        Intangible assets consist of the following (in thousands):

	December 31,
	2002		2001
Broadcast licenses	$	1,159,868	$	1,018,237
Other intangible assets		19,531		17,664
		1,179,399		1,035,901
Less accumulated amortization		98,554		97,746
	$	1,080,845	$	938,155

        Intangible assets as of December 31, 2002 are summarized as follows (in thousands):

	Gross Carrying Amount		Accumulated Amortization		Net Amount
Intangible assets subject to amortization	$	12,976	$	11,091	$	1,885
Intangible assets not subject to amortization		1,264,048		99,843		1,164,205
	$	1,277,024	$	110,934	$	1,166,090

        Amortization expense for the years ended December 31, 2002, 2001 and 2000 is $0.5, $26.7 and $26.6 million, respectively. Estimated amortization expense of intangible assets acquired as of December 31, 2002 with finite useful lives are summarized as follows (in thousands):

Year	Amount
2003	$	604
2004		475
2005		253
2006		105
2007		105

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        The reconciliation of reported net income to adjusted net income, which is adjusted for the effect of amortization of intangible assets with an indefinite useful life (net of income taxes) is as follows (in thousands except per share data):

	Year Ended December 31,
	2002		2001		2000
Reported net income	$	40,213	$	30,969	$	41,531
Broadcast licenses amortization, net of income tax		—		14,827		13,431
Cost in excess of fair value of net assets acquired amortization, net of income tax		—		1,637		1,554
Other intangible assets amortization, net of income tax		—		86		77
Adjusted net income	$	40,213	$	47,519	$	56,593

			Year Ended December 31,
			2002		2001		2000
Adjusted net income per common share:
	Basic:
		Reported net income	$	0.37	$	0.28	$	0.38
		Broadcast licenses amortization, net of income tax		—		0.14		0.12
		Cost in excess of fair value of net assets acquired amortization, net of income tax		—		0.02		0.01
		Other intangible assets amortization, net of income tax		—		—		—
		Adjusted net income	$	0.37	$	0.44	$	0.51
Diluted:
		Reported net income	$	0.37	$	0.28	$	0.38
		Broadcast licenses amortization, net of income tax		—		0.14		0.12
		Cost in excess of fair value of net assets acquired amortization, net of income tax		—		0.01		0.01
		Other intangible assets amortization, net of income tax		—		—		—
		Adjusted net income	$	0.37	$	0.43	$	0.51

7. Investments

        The Company recognized an impairment loss of $0.8 million in 2001 associated with an investment. The fair market value of the investment was determined to be zero based on a review of current financial information. The loss is included in operating expenses for the year ended December 31, 2001.

        In 2001, the Company sold marketable equity securities. Included in other income, net for the year ended December 31, 2001 is a realized gain of $2.5 million from the sale of these securities.

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8. Accrued Expenses

        Accrued expenses consist of the following (in thousands):

	December 31,
	2002		2001
Wages, salaries and benefits payable	$	3,304	$	4,193
Commissions payable		5,816		5,411
Advertising payable		296		1,343
Other accrued expenses		5,975		5,021
	$	15,391	$	15,968

9. Minority Interest

        On May 10, 1999, the Company purchased a 24.5% interest in Rawhide Radio, LLC ("Rawhide"). Rawhide owns radio stations KVCQ(FM) in Cuero, Texas and KBAE(FM) in Llano, Texas. On May 24, 2002, the Company entered into a purchase agreement to acquire an additional 51.0% ownership interest for $3.0 million. The additional 51.0% ownership interest was acquired in a non-cash transaction by reducing notes receivable held by the Company, which were issued by the seller of the 51.0% interest. The acquisition closed on December 3, 2002. The investment in Rawhide was accounted for using the equity method from its inception on May 10, 1999 through December 2, 2002. After the acquisition of the additional interest, the Company owns a 75.5% interest in Rawhide. The accounts of Rawhide are consolidated with the Company starting on December 3, 2002 and the outside ownership interest in the partnership has been recorded as minority interest.

10. Long-Term Obligations

        The following is a summary of long-term obligations outstanding as of December 31, 2002 and 2001 (in thousands):

	2002		2001
Revolving credit facility payable to banks; aggregate commitment of $180.0 million; interest rate based on LIBOR plus an applicable margin as determined by the Company's leverage ratio; interest rate at December 31, 2002 is 2.1%; payable through December 2004; secured by 100% of the common stock of the Company's wholly-owned subsidiaries; the Company is required to comply with certain financial and nonfinancial covenants	$	15,000	$	—
Prize awards net of imputed interest (10% to 12%), payable in varying annual installments through 2044		1,419		1,424
Other long-term obligation		17		—
		16,436		1,424
Less current portion		7		6
	$	16,429	$	1,418

        The Company's ability to make additional borrowings under the Credit Facility is subject to compliance with certain financial ratios and other conditions set forth in the Credit Facility. As of

48

December 31, 2002, the Company had $165.0 million of credit available. The Credit Facility commitment began reducing on September 30, 1999 and continues quarterly through December 31, 2004.

        Maturities of long-term obligations for the five years subsequent to December 31, 2002 are as follows (in thousands):

Year	Amount
2003	$	7
2004		15,007
2005		8
2006		9
2007		10
Thereafter		1,394

        Interest paid for the years ended December 31, 2002, 2001 and 2000 amounted to $1.0, $0.9 and $0.7 million, respectively.

11. Commitments and Contingencies

        The Company leases office space and other property under noncancellable operating leases. Terms of the leases vary from one to thirty years. Certain leases have contingent rent clauses whereby rent is increased based on a change in the Consumer Price Index. Various leases have renewal options of three to twenty years. Future minimum rental payments under noncancellable operating leases in effect at December 31, 2002 are summarized as follows (in thousands):

Year	Amount
2003	$	8,742
2004		8,262
2005		7,695
2006		6,935
2007		5,997
Thereafter		40,396

        Rent expense for the years ended December 31, 2002, 2001 and 2000 was $8.9, $8.5 and $5.0 million, respectively.

        The Company is subject to legal proceedings and other claims which have arisen in the ordinary course of business and as described below and have not been fully adjudicated. These actions, when ultimately concluded, will not, in the opinion of management, have a material adverse effect upon the financial position or results of operation of the Company.

        On June 12, 2002, Spanish Broadcasting System, Inc. ("SBS") filed Spanish Broadcasting System, Inc. v. Clear Channel Communications, Inc. and Hispanic Broadcasting Corporation in the United States District Court for the Southern District of Florida. SBS alleged a variety of claims against the defendants including claims for federal and state antitrust violations under the Sherman Act, the Florida Antitrust Act, and California's Cartwright Act. SBS's complaint also included numerous other state law causes of action including, among others, tortious interference, defamation, and violation of the California Unfair Competition Act. The plaintiff, and both defendants, own and operate radio stations throughout the United States, and SBS's claims arose out of steps the defendants allegedly took to undermine SBS's radio station business. On July 31, 2002, plaintiff amended its

49

complaint. The amended complaint sought actual damages in excess of $500 million before any trebling under federal or state statute along with attorney fees and other unspecified damages. On January 31, 2003, the United States District Court entered a final order dismissing the case with prejudice. On February 14, 2003, SBS filed a motion for reconsideration of the order which dismissed the case. SBS has announced that, if its motion for reconsideration is not granted, then it will appeal the dismissal order. The Company is vigorously contesting this matter.

12. Stockholders' Equity

Common Stock

        In 2001, the Company purchased 685,500 shares of its Class A Common Stock at a weighted average price per share of $14.75.

        Clear Channel owns all of the issued and outstanding Class B Common Stock. The rights of the Class A and Class B Common Stock are identical except that the Class B Common Stock has no voting rights, except in certain matters. Shares of Class B Common Stock are convertible into shares of Class A Common Stock, at Clear Channel's option, subject to any necessary governmental consents, including the consent of the FCC.

Preferred Stock

        The Company is authorized to issue 5,000,000 shares of $.001 par value Preferred Stock. The Preferred Stock may be issued in series, with the rights and preferences of each series established by the Company's Board of Directors.

13. Operating Expenses

        Operating expenses consist of the following (in thousands):

	Year Ended December 31,
	2002		2001		2000
Rent	$	8,638	$	8,241	$	4,741
General promotion		9,905		10,680		7,374
Music fees and licenses		8,328		7,046		6,554
Special events		9,565		8,376		8,866
Representative commissions		6,464		6,445		6,797
Other operating expenses		35,868		34,611		31,409
	$	78,768	$	75,399	$	65,741

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14. Corporate Expenses

        Corporate expenses consist of the following (in thousands):

	Year Ended December 31,
	2002		2001		2000
Travel costs	$	525	$	420	$	462
Outside consulting		702		503		367
Telecommunication costs		355		398		292
Legal and professional fees		7,379		777		1,012
Other corporate expenses		2,031		1,620		1,746
	$	10,992	$	3,718	$	3,879

15. Income Taxes

        The provision for income tax consists of the following (in thousands):

		Year Ended December 31,
		2002		2001		2000
Current:
	Federal	$	2,011	$	9,117	$	15,552
	State		426		1,205		3,548
Total current tax			2,437		10,322		19,100
Deferred:
	Federal		20,078		8,102		6,640
	State		3,759		1,518		1,320
Total deferred tax			23,837		9,620		7,960
Total income tax		$	26,274	$	19,942	$	27,060

        The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities at December 31, 2002 and 2001 are as follows (in thousands):

		2002		2001
Deferred tax assets:
	Net operating losses	$	922	$	922
	Other intangible assets		1,459		1,871
	Long-term obligations—prize awards		553		556
	Allowance for doubtful accounts receivable		1,437		1,347
	Other		2,288		749
Total deferred tax assets			6,659		5,445
Deferred tax liabilities:
	Broadcast licenses		138,043		115,053
	Property and equipment		4,538		2,492
	Other		7,401		7,386
Total deferred tax liabilities			149,982		124,931
Net deferred tax liabilities		$	143,323	$	119,486

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        The reconciliation of income tax expense computed at the federal statutory tax rate to the Company's actual income tax expense is as follows (in thousands):

	Year Ended December 31,
	2002		2001		2000
Federal income tax at statutory rate	$	23,271	$	17,819	$	24,007
State income taxes, net of federal benefit		2,720		1,770		3,163
Nondeductible and non-taxable items, net		283		353		(110	)
	$	26,274	$	19,942	$	27,060

        As of December 31, 2002, the Company had tax net operating loss carryforwards for state tax purposes of approximately $16.5 million which expire in years 2005 through 2022 if not used.

        Income taxes paid for the years ended December 31, 2002, 2001 and 2000 amounted to $2.6, $8.0 and $22.9 million, respectively.

16. Earnings Per Share

        The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations (in thousands):

			Year Ended December 31,
			2002		2001		2000
Numerator:
	Net income		$	40,213	$	30,969	$	41,531
Denominator:
	Denominator for basic earnings per share			108,723		108,872		108,858
	Effect of dilutive securities:
		Stock options		804		733		1,514
		Employee Stock Purchase Plan		16		12		16
	Denominator for diluted earnings per share			109,543		109,617		110,388

        Stock options which were excluded from the computation of diluted earnings per share due to their antidilutive effect amounted to 2.1, 1.7 and 0.6 million shares for the years ended December 31, 2002, 2001 and 2000.

17. Retirement Plan

        The Company has a defined contribution retirement savings plan (the "Plan"). The Plan covers all employees who have reached the age of 18 years. The Company matches participants' contributions to the Plan in an amount not to exceed $1,500 annually. The Company, at the sole discretion of the Board of Directors, may make additional supplemental contributions to the Plan. The Company's expenses related to the Plan for the years ended December 31, 2002, 2001 and 2000 amounted to $0.6, $0.6 and $0.6 million, respectively.

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18. Supplemental Cash Flows Information

        Noncash investing and financing activities for the year ended December 31, 2002 are as follows (in thousands):

	Increase (Decrease)
	Property and equipment, net			Intangible assets, net		Restricted cash			Deferred charges and other assets
Amounts reclassified due to the completion of radio station upgrades	$	29		$	36,830	$	—		$	(36,859	)
Amounts reclassified due to radio station acquisitions		(18	)		4,760		(4,401	)		(341	)
	$	11		$	41,590	$	(4,401	)	$	(37,200	)

19. Stock Options

        In May 1997, the stockholders of the Company approved a stock incentive plan ("Long-Term Incentive Plan"), to be administered by the Board of Directors or by a committee of the Board of Directors. The maximum number of shares of Class A Common Stock that may be the subject of awards at any one time shall be ten percent of the total number of shares of Class A Common Stock outstanding. Options granted under the Long-Term Incentive Plan have a ten-year term and vest over various periods up to five years.

        The stockholders of the Company also approved an Employee Stock Purchase Plan in May 1997. Under the plan, shares of the Company's common stock may be purchased at six-month intervals at 85% of the lower of the fair market value on the first or the last day of each six-month period. Employees may purchase shares having a value not exceeding 15% of their gross compensation during an offering period. During 2002, 2001 and 2000, employees purchased 45,754, 55,980 and 37,768 common shares at average prices of $19.85, $23.35 and $29.64, respectively.

        The Company granted 1,025,500, 844,000 and 2,169,400 stock options in 2002, 2001 and 2000, respectively, to various employees of the Company under its Long-Term Incentive Plan. The exercise prices of options outstanding at December 31, 2002 ranged from $8.22 to $50.57 per share, the market prices at dates of grant.

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        The following is a summary of stock options outstanding and exercisable for the years ended December 31, 2000, 2001 and 2002 (in thousands, except per share data):

		Number Of Shares		Weighted Average Exercise Price Per Share
Stock Options Outstanding:
	Options outstanding at December 31, 1999	2,952		$	17.31
	Granted	2,169			27.23
	Forfeited	(221	)		25.26
	Exercised	(118	)		11.75
	Options outstanding at December 31, 2000	4,782			21.58
	Granted	844			21.39
	Forfeited	(390	)		23.78
	Exercised	(222	)		12.50
	Options outstanding at December 31, 2001	5,014			21.72
	Granted	1,025			24.52
	Forfeited	(172	)		24.85
	Exercised	(232	)		13.59
	Options outstanding at December 31, 2002	5,635			22.47
Exercisable Stock Options:
	Options exercisable at December 31, 1999	69		$	14.49
	Vested	623			14.09
	Exercised	(118	)		11.75
	Options exercisable at December 31, 2000	574			14.62
	Vested	1,082			20.16
	Exercised	(222	)		12.50
	Options exercisable at December 31, 2001	1,434			18.15
	Vested	1,312			20.83
	Exercised	(232	)		13.59
	Options exercisable at December 31, 2002	2,514			20.04

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        The following is a summary of stock options outstanding and exercisable at December 31, 2002:

Range of Exercise Prices Per Share	Shares Under Option (in thousands)	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (in years)
Stock Options Outstanding:
$8.22 - $11.75	672	$	11.69	4.4
12.34 - 18.13	622		17.63	5.8
18.75 - 28.02	3,296		22.05	8.0
28.75 - 41.84	1,039		33.52	7.4
50.57	6		50.57	7.1
	5,635
Exercisable Stock Options:
$8.22 - $11.75	672	$	11.69	4.4
12.34 - 18.13	427		17.53	5.7
18.75 - 28.02	1,006		21.21	7.6
32.25 - 41.84	409		33.50	7.4
	2,514

20. Quarterly Results of Operations (Unaudited)

        The following is a summary of the quarterly results of operations for the years ended December 2002 and 2001 (in thousands, except per share data):

			First Quarter		Second Quarter		Third Quarter		Fourth Quarter
Year ended December 31, 2002:
	Net revenues		$	51,951	$	68,596	$	70,248	$	65,750
	Net income			6,926		10,434		12,025		10,828
	Net income per common share:
		Basic		0.06		0.10		0.11		0.10
		Diluted		0.06		0.09		0.11		0.10
	Comprehensive income			6,926		10,434		12,025		10,828
Year ended December 31, 2001:
	Net revenues		$	47,796	$	65,896	$	65,801	$	61,282
	Net income			3,618		10,246		8,492		8,613
	Net income per common share—basic and diluted			0.03		0.09		0.08		0.08
	Comprehensive income			3,618		11,319		7,837		8,195

21. Subsequent Events

        On February 28, 2003, the Company paid the $15.0 million principal balance on the Credit Facility. The Company expects to terminate the Credit Facility after the merger with Univision has been completed. Upon termination of the Credit Facility, Univision will pay the outstanding borrowings, if any, and the Company will fund future capital needs through Univision.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

        Not applicable.

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PART III.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

DIRECTORS AND EXECUTIVE OFFICERS

        The following table sets forth information concerning the executive officers of the Company and the current directors:

Name	Position with Company	Age
McHenry T. Tichenor, Jr.	Chairman of the Board, President and Chief Executive Officer	47
Jeffrey T. Hinson	Senior Vice President, Chief Financial Officer and Treasurer	48
Gary B. Stone	Senior Vice President and Chief Operating Officer	51
McHenry T. Tichenor	Director	70
Robert W. Hughes	Director	67
James M. Raines	Director	63
Ernesto Cruz	Director	48

        McHenry T. Tichenor, Jr. has been the Chairman of the Board, President, Chief Executive Officer, and a director of the Company since February 14, 1997. From 1981 until February 14, 1997, Mr. Tichenor was the President, Chief Executive Officer, and a director of Tichenor Media System, Inc. ("Tichenor Media"). McHenry T. Tichenor, Jr. is the son of McHenry T. Tichenor.

        Jeffrey T. Hinson has served as the Senior Vice President and Chief Financial Officer of the Company since February 14, 1997. From October 1995 until February 14, 1997, Mr. Hinson served as the Chief Financial Officer, Treasurer, and a director of Tichenor Media.

        Gary B. Stone has served as the Senior Vice President and Chief Operating Officer of the Company since March 1, 2001 and Vice President and General Manager of the Los Angeles and Houston radio stations. Mr. Stone previously served as a Vice President with Tichenor Media and started his career with Tichenor in 1985.

        McHenry T. Tichenor has been a director and an employee of the Company since February 14, 1997. From 1981 until February 14, 1997, Mr. Tichenor served as the Vice Chairman and a director of Tichenor Media. McHenry T. Tichenor is the father of McHenry T. Tichenor, Jr.

        Mr. Hughes became a director of the Company on February 14, 1997. Mr. Hughes is Chairman of Prime Management Group in Austin, Texas. In that capacity, he also serves as Chairman of Prime New Ventures and Prime II Investments and has served in such positions for more than five years. Mr. Hughes also serves as Chairman of Grande Communications. For the past 35 years, he has primarily been involved in the cable television industry.

        Mr. Raines became a director of the Company on August 5, 1996. Mr. Raines is the President of James M. Raines & Company, a private investment firm, and has served in such position for more than five years. Mr. Raines serves on the Board of Directors of Waddell & Reed Financial, Inc.

        Mr. Cruz became a director of the Company on August 5, 1996. Mr. Cruz is a Managing Director of Credit Suisse First Boston, Inc. and has served in this position for more than five years. Mr. Cruz is also head of global equity capital markets of Credit Suisse First Boston, Inc. Mr. Cruz serves on the Group Executive Board of Credit Suisse First Boston, Inc.

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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

        Section 16 of the Securities Exchange Act of 1934, as amended, requires the Company's directors and executive officers and persons who own more than 10% of a registered class of the Company's equity securities to file various reports with the Securities and Exchange Commission concerning their holdings of, and transactions in, securities of the Company. Copies of these filings must be furnished to the Company.

        Based solely on its review of the copies of such forms received by it, or written responses from certain reporting persons that no such forms were required to be filed by those persons, the Company believes that during the year ended December 31, 2002, directors, executive officers and beneficial owners of more than 10% of the Company's Class A Common Stock were in compliance with the applicable filing requirements except that Robert W. Hughes, a director of the Company, filed three statements of changes in beneficial ownership regarding an aggregate of seven transactions after the filing deadline for such reports.

ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation Table

        The following table sets forth information concerning the compensation of each individual who served as Chief Executive Officer during the year ended December 31, 2002, and each of the other executive officers whose total cash compensation exceeded $100,000 for services rendered in all capacities for the year ended December 31, 2002 (the "Named Executive Officers"):

		Annual Compensation						Long-Term Compensation
								Awards			Payouts
						Other Annual Compen- sation($)
Name And Principal Position	Year	Salary($)		Bonus($)				Restricted Stock Awards($)		Options(#)	LTIP Payout($)		All Other Compensation ($)
McHenry T. Tichenor, Jr.	2002	$	400,000	$	621,155	$	—	$	—	150,000	$	—	$	1,500	(1)
Chairman, President and CEO	2001		300,000		519,437		—		—	35,000		—		1,750	(1)
	2000		300,000		581,653		—		—	90,000		—		1,750	(1)
Gary B. Stone	2002		280,000		314,653		—		—	40,000		—		1,899	(2)
Senior Vice President	2001		354,062		88,418		—		—	60,000		—		39,010	(2)
COO(4)	2000		500,000		94,651		—		—	34,000		—		7,800	(3)
Jeffrey T. Hinson	2002		300,000		387,271		—		—	40,000		—		1,500	(1)
Senior Vice President	2001		250,000		212,802		—		—	90,000		—		1,750	(1)
and CFO	2000		250,000		273,315		—		—	80,000		—		1,750	(1)

(1)

Represents Company contributions to the 401(k) plan account of the respective employee.

(2)

Represents unqualified moving expenses which were paid by the Company.

(3)

Represents $7,550 taxable fringe benefit related to certain relocation costs paid by the Company on Mr. Stone's behalf and a $250 contribution by the Company into the 401(k) plan account of Mr. Stone.

(4)

Mr. Stone became a Senior Vice President and COO effective March 1, 2001.

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Options

        The following table sets forth certain information concerning options granted to the Named Executive Officers during the year ended December 31, 2002:

	Individual Grants
		Percent of Total Options Granted to Employees in Fiscal Year
	Number of Securities Underlying Options Granted (#)						Potential Realizable Value At Assumed Annual Rates of Stock Price Appreciation for Option Term
Name				Exercise or Base Price ($/share)		Expiration Date
							5%($)		10%($)
McHenry T. Tichenor, Jr.	100,000	9.8	%	$	28.02	04/02/2012	$	1,762,163	$	4,465,666
	50,000	4.9	%		24.00	06/04/2012		754,674		1,912,491
Gary B. Stone	40,000	3.9	%		24.00	06/04/2012		603,739		1,529,993
Jeffrey T. Hinson	40,000	3.9	%		24.00	06/04/2012		603,739		1,529,993

        The following table sets forth certain information regarding stock options exercised by the Named Executive Officers during the year ended December 31, 2002, including the aggregate value of gains on the date of exercise. In addition, the table sets forth the number of shares covered by both exercisable and nonexercisable stock options as of December 31, 2002. Also reported are the values of "in the money" options which represent the positive spread between the exercise price of any existing stock options and the Common Stock price as of December 31, 2002.

			Number of Securities Underlying Unexercised Options at Fiscal Year End (#)		Value of Unexercised In-the-Money Options at Fiscal Year End ($)
Name	Shares Acquired on Exercise (#)	Value Realized ($)
			Exercisable	Unexercisable	Exercisable		Unexercisable
McHenry T. Tichenor, Jr.	—	—	210,334	220,666	$	78,830	$	(1,001,480	)
Gary B. Stone	—	—	101,760	155,732		328,496		(431,946	)
Jeffrey T. Hinson	—	—	177,332	170,668		500,750		(456,170	)

Employment Agreements

        On February 14, 1997, the Company entered into an Employment Agreement with McHenry T. Tichenor, Jr. to serve as President and Chief Executive Officer of the Company. This employment agreement provided for a five year term at an annual base salary of $260,000 plus increases in the base salary and incentive compensation as determined by the Compensation Committee of the Board of Directors. Upon termination by the Company without cause or by Mr. Tichenor for good reason, the Company was obligated to pay Mr. Tichenor a lump sum amount equal to the estimated payments of salary and bonus remaining through the end of the term of the agreement. Furthermore, Mr. Tichenor's employment agreement provided that Mr. Tichenor agreed not to compete with the Company for a period of one year following the date his employment agreement was terminated.

        On April 2, 2002, the Company entered into an Amended and Restated Employment Agreement with McHenry T. Tichenor, Jr. to serve as Chairman, President and Chief Executive Officer of the Company. Mr. Tichenor's current employment agreement provides for a three year term which automatically renews for an additional two year term if neither the Company nor Mr. Tichenor elect to terminate the agreement. Mr. Tichenor's annual base salary under the employment agreement is $400,000 which shall be increased annually by the Compensation Committee by at least 5%. The employment agreement also provides for Mr. Tichenor to be awarded additional bonus compensation as determined by the Compensation Committee. The employment agreement provides Mr. Tichenor with an initial grant of stock options to purchase 100,000 shares of Class A Common Stock. Upon

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termination of the employment agreement by the Company without cause or by Mr. Tichenor for good reason, the Company is obligated to pay Mr. Tichenor three times the amount of his then current annual base salary and prior year's bonus. Furthermore, Mr. Tichenor's employment agreement provides that Mr. Tichenor agrees not to compete with the Company for a minimum period of one year following the date his employment is terminated.

        On March 1, 2001, the Company entered into an Employment, Nonsolicitation and Arbitration Agreement with Gary Stone to serve as the Senior Vice President and Chief Operating Officer. Mr. Stone's agreement provides for a three-year term at an annual base salary of $262,500 plus profit sharing and a discretionary bonus. Increases in the base salary, profit sharing and discretionary bonus are to be approved by the Compensation Committee. Mr. Stone's employment agreement provides for the Company to loan him up to $1.5 million. The loan requires interest only payments at 6% annual interest and matures on July 22, 2006. On July 30, 2001 and September 11, 2001, the Company advanced Mr. Stone $400,000 and $767,000, respectively. As of December 31, 2002, Mr. Stone can borrow up to $235,603 more under the terms of the loan. The loan is secured by 130,000 shares of Class A Common Stock owned by Mr. Stone. Upon termination by the Company without cause, the Company is obligated to either give Mr. Stone 180 days written notice or pay 180 days base salary plus a pro rata portion of estimated bonuses, to be paid in a lump sum or six semi-monthly payments. Furthermore, Mr. Stone's employment agreement provides that Mr. Stone agrees not to compete with the Company for a period of one year following the date his employment is terminated.

        On November 5, 2001, the Company entered into an Employment, Noncompetition and Arbitration Agreement with Jeffrey T. Hinson to serve as the Senior Vice President and Chief Financial Officer. The employment agreement provides for a three-year term at an annual base salary of $300,000 and shall be increased 5% each January 1 during the term of the employment agreement. Mr. Hinson's compensation also includes profit sharing and an annual bonus. The employee's base salary, profit sharing and annual bonus shall be reviewed by the Compensation Committee not less frequently than on an annual basis. Mr. Hinson's cash compensation attributable to any calendar year (i.e., base salary and profit sharing paid during a calendar year, plus the annual bonus attributable to such calendar year, but paid the following year) during the initial employment term (including calendar year 2001) shall not be less than $600,000.

Director Compensation

        Each member of the Board of Directors other than McHenry T. Tichenor, Jr. and McHenry T. Tichenor is to receive an annual fee of $50,000, payable annually in advance. McHenry T. Tichenor receives an annual director fee of $20,000, which is paid on a quarterly basis. The directors may elect to receive directors fees in cash or shares of the Company's Class A Common Stock. Each non-employee director receives a one-time grant of 2,500 options of the Company's Class A Common Stock when they attend their first meeting of the Board of Directors. These options are fully exercisable commencing six months from the date of grant and expire ten years after the date of grant. The Company also reimburses directors for expenses related to attending board or committee meetings. In addition, in June 1998, March 1999, May 2000, October 2000, May 2001 and June 2002 each outside director was granted options to purchase 4,000, 5,000, 6,000, 6,000, 6,000 and 6,000 shares of Class A Common Stock, respectively. These options vested six months following their date of grant.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table sets forth certain information regarding ownership of the Class A Common Stock as of December 31, 2002 by (i) each person known by the Company to be the beneficial owner of more than 5% of the outstanding shares of Class A Common Stock, (ii) each director of the Company,

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(iii) the chief executive officer and each other current executive officers of the Company named in the Summary Compensation Table, and (iv) all directors and executive officers of the Company as a group:

Name	Amount and Nature of Beneficial Ownership of Class A Common Stock		Percent of Class
McHenry T. Tichenor, Jr.	12,987,689	(1)	16.1
McHenry T. Tichenor	12,725,229	(2)	15.8
Warren W. Tichenor	12,832,555	(3)	15.9
Janus Capital Management, LLC	5,358,820	(4)	6.7
Franklin Advisers, Inc.	4,604,300	(5)	5.7
Robert W. Hughes	59,000	(6)(7)	*
James M. Raines	30,000	(6)	*
Ernesto Cruz	47,000	(6)(8)	*
Jeffrey T. Hinson	471,208	(6)	*
Gary B. Stone	318,554	(6)	*
All Directors and Executive Officers as a Group (7 persons)	13,926,229		17.3

*

Indicates less than 1.0%.

(1)

Includes 3,333,906 shares (including 210,334 employee and director stock options for shares of Class A common stock granted by Hispanic Broadcasting that are fully exercisable and 47,588 shares held by McHenry T. Tichenor, Jr. as trustee of the Genevieve Beryl Tichenor Trust) held by McHenry T. Tichenor, Jr., and 9,653,783 shares held by McHenry T. Tichenor, Jr.'s family, with respect to which McHenry T. Tichenor, Jr. shares voting control pursuant to a voting agreement among certain members of the Tichenor family (the "Tichenor Voting Agreement").

(2)

Includes 151,343 shares (including 11,135 employee or director stock options for shares of Class A common stock granted by Hispanic Broadcasting that are fully exercisable) held by McHenry T. Tichenor and 12,573,886 shares held by McHenry T. Tichenor's family, with respect to which McHenry T. Tichenor shares voting control pursuant to the Tichenor Voting Agreement.

(3)

Includes 4,478,740 shares (including 13,686 shares owned by Mr. Tichenor's spouse and for which Mr. Tichenor disclaims beneficial ownership) held by Warren W. Tichenor and 8,353,815 shares held by Warren W. Tichenor's family, with respect to which Warren W. Tichenor shares voting control pursuant to the Tichenor Voting Agreement. Warren W. Tichenor's mailing address is 45 N.E. Loop 410, Suite 655, San Antonio, Texas 78216.

(4)

Address: 100 Fillmore Street, 2^nd Floor, Denver, Colorado 80206.

(5)

Address: One Franklin Parkway, Building 920, San Mateo, California 94403.

(6)

The following listed individuals, in addition to Mr. Tichenor, Jr. and Mr. Tichenor, hold employee or director stock options for shares of Class A common stock granted by Hispanic Broadcasting that are fully exercisable or will vest and become exercisable within 60 days of December 31, 2002: Mr. Hughes—43,000; Mr. Raines—29,000; Mr. Cruz—43,000; Mr. Hinson—177,332; and Mr. Stone—119,760.

(7)

Includes 12,000 shares owned by a trust for the benefit of one of Mr. Hughes' children and two other entities that may be attributable to Mr. Hughes. Mr. Hughes disclaims beneficial ownership of these shares.

(8)

Includes 4,000 shares owned by Mr. Cruz's spouse and children. Mr. Cruz disclaims beneficial ownership of these shares.

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        As of December 31, 2002, Clear Channel and its affiliates owned no shares of Class A Common Stock. However, Clear Channel and its affiliates owned all of the outstanding shares of the Company's Class B Common Stock (28,312,940 shares), which accounted for approximately a 26.0% interest in the common stock of the Company.

        The Compensation Committee believes that equity ownership by the executive officers, managers, and other employees of the Company provides incentive to build stockholder value and aligns the interests of these employees with the interests of stockholders. Upon hiring executive officers, managers, and certain other key employees, the Option Committee, a subcommittee of the Compensation Committee, typically approves stock option grants under the Incentive Plan, subject to applicable vesting periods. Thereafter, the Option Committee considers awarding additional grants, usually on an annual basis, under the Incentive Plan. The Option Committee believes these additional annual grants will provide incentives for executive officers, managers, and key employees to remain with the Company. Options are granted at the current market price of the Company's Class A Common Stock and, consequently, have value only if the price of the Company's Class A Common Stock increases over the exercise price. The size of the initial and periodic grants to employees other than the CEO and the executive officers are proposed by the CEO, reviewed and, when appropriate, revised and approved by the Option Committee. The Option Committee establishes the size of the initial and periodic grants to the CEO and the executive officers.

        At the 1997 Annual Meeting, the stockholders approved the Incentive Plan, which meets the requirements of Section 162(m) of the Internal Revenue Code. The Company's present intention is that awards under the Incentive Plan comply with Section 162(m).

        Securities authorized for issuance under equity compensation plans as of December 31, 2002 are as follows:

Plan category		Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)	Weighted-average exercise price of outstanding options warrants and rights (b)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a) (c)
Equity compensation plans approved by security holders		5,635,306	$	22.47	2,416,312
Equity compensation plans not approved by security holders		—		—	—
	Total	5,635,306	$	22.47	2,416,312

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        The following transactions were entered into between the Company and certain current directors, officers and beneficial owners of five percent or more of the Company's Class A Common Stock.

        The Company employs McHenry T. Tichenor to consult on various matters. For the year ended December 31, 2002, Mr. Tichenor's salary was $50,000.

        Mr. Stone's employment agreement provides for the Company to loan him up to $1.5 million. The loan requires interest only payments at 6% annual interest and matures on July 22, 2006. On July 30, 2001 and September 11, 2001, the Company advanced Mr. Stone $400,000 and $767,000, respectively. As of December 31, 2002, Mr. Stone can borrow up to $235,603 more under the terms of the loan. The loan is secured by 130,000 shares of Class A Common Stock owned by Mr. Stone.

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        The Company engaged CSFB to advise the Company on the merger with Univision. Ernesto Cruz, a director of the Company, is employed by CSFB. In 2002, the Company paid CSFB $2.0 million in fees for their services.

ITEM 14. CONTROLS AND PROCEDURES

        Our principal executive and financial officers have concluded, based on their evaluation as of a date within 90 days before the filing of this Form 10-K, that our disclosure controls and procedures (as defined in Rule 13a-14 of the Securities Exchange Act of 1934) are effective to ensure that information we are required to disclose in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and include controls and procedures designed to ensure that information we are required to disclose in such reports is accumulated and communicated to management, including our principal executive and financial officers, as appropriate to allow timely decisions regarding required disclosure.

        Subsequent to our evaluation, there were no significant changes in internal controls or other factors that could significantly affect these internal controls.

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PART IV.

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)

1.

Financial Statements

The following financial statements have been filed under Item 8 of this report:

Independent Auditors' Report

Consolidated Balance Sheets as of December 31, 2002 and 2001

Consolidated Statements of Income and Comprehensive Income for the Years Ended December 31, 2002, 2001 and 2000

Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 2002, 2001 and 2000

Consolidated Statements of Cash Flows for the Years Ended December 31, 2002, 2001 and 2000

Notes to Consolidated Financial Statements

2.

Financial Statement Schedules

Hispanic Broadcasting Corporation and Subsidiaries
Valuation and Qualifying Accounts
For the years ended December 31, 2002, 2001 and 2000
(in thousands)

					Additions
Description			Balance at beginning of period		Charged to costs and expenses		Charged to other accounts			Accounts written off		Balance at end of period
For the year ended December 31, 2002:
	Current:
		Allowance for Doubtful Accounts	$	3,458	$	2,378	$	(760	)	$	2,407	$	2,669
	Non current:
		Allowance for Doubtful Accounts		—		255		760			—		1,015
For the year ended December 31, 2001:
	Current:
		Allowance for Doubtful Accounts		3,181		4,289		52			4,064		3,458
For the year ended December 31, 2000:
	Current:
		Allowance for Doubtful Accounts		1,855		3,757		—			2,431		3,181

3.

Exhibits

Exhibit Number	Description
2.1	Agreement and Plan of Reorganization, dated June 11, 2002, by and among Univision Communications Inc., Univision Acquisition Corporation and Hispanic Broadcasting Corporation (incorporated by reference to Univision Communications Inc. Current Report on Form 8-K, dated June 12, 2002, File No. 001-12223).

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2.2	Univision Stockholder Support Agreement, dated June 11, 2002, by and among Univision Communications Inc., Hispanic Broadcasting Corporation, and A. Jerrold Perenchio (incorporated by reference to Univision Communications Inc. Current Report on Form 8-K, dated June 12, 2002, File No. 001-12223).
2.3	HBC Stockholder Support Agreement, dated June 11, 2002, by and among Univision Communications Inc., Univision Acquisition Corporation, and the stockholders listed on Exhibit A thereto (incorporated by reference to Univision Communications Inc. Current Report on Form 8-K, dated June 12, 2002, File No. 001-12223).
3.1	Second Amended and Restated Certificate of Incorporation of the Company dated February 14, 1997 (incorporated by reference to Exhibit 3.1 to the Company's Form 8-K filed March 3, 1997).
3.2	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation of the Company dated June 4, 1998 (incorporated by reference to Exhibit 3.1 to the Company's Form 10-Q filed on November 12, 1998).
3.3	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation of the Company dated June 3, 1999 (incorporated by reference to Exhibit 3.3 to the Company's Form 10-Q filed on August 12, 1999).
3.4	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation of the Company dated May 25, 2000 (incorporated by reference to Exhibit 3.4 to the Company's Form 10-Q filed on August 11, 2000).
3.5	Amended and Restated Bylaws of the Company (incorporated by reference to Exhibit 3.2 to the Company's Registration Statement on Amendment No. 3 to Form S-1 (Registration No. 33-78370) filed on July 8, 1994).
4.1	Specimen certificate for the Class A Common Stock (incorporated by reference to Exhibit 4.1 to the Company's Registration Statement on Amendment No. 3 to Form S-1 (Registration No. 33-78370) filed on July 8, 1994).
4.2	Specimen certificate for the Class B Common Stock (incorporated by reference to Exhibit 4.2 to the Company's Form 10-Q filed on August 13, 2002).
10.1	Registration Rights Agreement, dated February 14, 1997, by and among the Company, McHenry T. Tichenor, Sr., McHenry T. Tichenor, Jr., Warren W. Tichenor, William E. Tichenor, Jean T. Russell, McHenry T. Tichenor, Jr., as Custodian for David T. Tichenor, Alta Subordinated Debt Partners III, L.P., Prime II Management, LP, PrimeComm, LP, Ricardo A. del Castillo, Jeffrey Hinson and David D. Lykes (incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed March 3, 1997).
10.2	Employment Agreement, dated February 14, 1997, by and between the Company and McHenry T. Tichenor, Jr. (incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed March 3, 1997).
10.3	Amended and Restated Employment Agreement, dated April 2, 2002, by and between Hispanic Broadcasting Corporation and McHenry T. Tichenor, Jr. (incorporated by reference to Exhibit 10.1 to the Company's Form 10-Q filed on May 15, 2002).

65

10.4	Amended and Restated Stockholders Agreement by and among the Company and each of the stockholders listed on the signature page thereto (incorporated by reference to Exhibit 10.7 to Amendment No. 2 of Schedule 13D of McHenry T. Tichenor filed November 19, 2002).
10.5	Amendment to Amended and Restated Stockholders Agreement by and among the Company and each of the stockholders listed on the signature page thereto (incorporated by reference to Exhibit 10.8 to Amendment No. 2 of Schedule 13D of McHenry T. Tichenor filed November 19, 2002).
10.6	Registration Rights Agreement, dated February 14, 1997, by and among the Company and Clear Channel Communications, Inc. (incorporated by reference to Exhibit 10.4 to the Company's Form 8-K filed March 3, 1997).
10.7	Credit Agreement among the Company and its subsidiaries, The Chase Manhattan Bank, as administrative agent, and certain other lenders, dated February 14, 1997 without Exhibits (Schedules omitted) (incorporated by reference to Exhibit 10.5 to the Company's Form 8-K filed on May 14, 1997).
10.8	Credit Agreement Amendment No. 1 among the Company and its subsidiaries, the Chase Manhattan Bank, as administrative agent, and certain other lenders, dated May 6, 1999 without Exhibits (Schedules omitted) (incorporated by reference to Exhibit 10.12 to the Company's Form 10-K filed on March 30, 2000).
10.9	Hispanic Broadcasting Corporation Long-Term Incentive Plan (incorporated by reference to Appendix A to the Company's Definitive Proxy Statement filed on April 24, 1997 (Commission File No. 000-24516)).
10.10	Amendment to Long-Term Incentive Plan, dated March 31, 2003.
10.11	Hispanic Broadcasting Corporation Amended and Restated 1997 Employee Stock Purchase Plan (incorporated by reference to the Company's Form S-8 filed on December 31, 1997).
10.12	Second Amended and Restated 1997 Employee Stock Purchase Plan, dated April 15, 2002 (incorporated by reference to Exhibit 10.1 to the Company's Form 10-Q filed on August 13, 2002).
10.13	Employment, Nonsolicitation and Arbitration Agreement, dated March 1, 2001, by and between HBC Management Company, Inc. and Gary Stone (incorporated by reference to Exhibit 10.1 to the Company's Form 10-Q filed on May 14, 2001).
10.14	Employment, Noncompetition and Arbitration Agreement, dated November 5, 2001, by and between HBC Management Company, Inc. and Jeffrey T. Hinson (incorporated by reference to Exhibit 10.17 to the Company's Form 10-K filed on April 1, 2002).
10.15	Asset Purchase Agreement, dated January 2, 2003, by and among Big City Radio, Inc., Big City Radio-Chi, L.L.C. and HBC Illinois, Inc.
10.16	First Amendment to Asset Purchase Agreement, dated January 9, 2003, by and among Big City Radio, Inc., Big City Radio-Chi, L.L.C. and HBC Illinois, Inc.
10.17	Stock Purchase Agreement, dated February 13, 2003, by and between Hispanic Broadcasting Corporation and Fundación Angel Ramos, Inc.

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10.18	Asset Purchase Agreement, dated March 3, 2003, by and among First Broadcasting Investments, L.P., HBC Sacramento, Inc., HBC License Corporation and HBC Broadcasting Texas, L.P.
10.19	Asset Purchase Agreement, dated March 17, 2003, by and among Simmons Lone Star Media, Ltd., Simmons-Austin, LLC, HBC Broadcasting Texas, L.P. and HBC License Corporation.
11	Statement Regarding Computation of Per Share Earnings.
21	Subsidiaries of the Company.
23	Consent of KPMG LLP.
24	Power of Attorney (included on Signature Page).

        Registrant agrees to furnish supplementally a copy of any omitted schedules to the Commission upon request.

(b)

Reports on Form 8-K

        The Company filed a report on Form 8-K dated November 14, 2002, disclosing that McHenry T. Tichenor, Jr., Chief Executive Officer and Jeffrey T. Hinson, Chief Financial Officer submitted unqualified certifications to the SEC, relating to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2002, pursuant to 18 U.S.C. § 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) 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, on March 31, 2003.

HISPANIC BROADCASTING CORPORATION
By:	/s/  MCHENRY T. TICHENOR, JR. McHenry T. Tichenor, Jr. President and Chief Executive Officer

        Each person whose signature appears below authorizes McHenry T. Tichenor, Jr. and Jeffrey T. Hinson, or either of them, each of whom may act without joinder of the other, to execute in the name of each such person who is then an officer or director of the Registrant and to file any amendments to this annual report on Form 10-K necessary or advisable to enable the Registrant to comply with the Securities Exchange Act of 1934, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission in respect thereof, which amendments may make such changes in such report as such attorney-in-fact may deem appropriate.

        Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Name	Title	Date
/s/  MCHENRY T. TICHENOR, JR. McHenry T. Tichenor, Jr.	President, Chief Executive Officer and Chairman of the Board of Directors	March 31, 2003
/s/  JEFFREY T. HINSON Jeffrey T. Hinson	Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)	March 31, 2003
/s/  DAVID P. GEROW David P. Gerow	Vice President, Controller and Secretary (Principal Accounting Officer)	March 31, 2003
/s/  MCHENRY T. TICHENOR McHenry T. Tichenor	Director	March 31, 2003
/s/  ROBERT W. HUGHES Robert W. Hughes	Director	March 31, 2003
/s/  JAMES M. RAINES James M. Raines	Director	March 31, 2003
/s/  ERNESTO CRUZ Ernesto Cruz	Director	March 31, 2003

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Certification

I, McHenry T. Tichenor, Jr., certify that:

1.

I have reviewed this annual report on Form 10-K of Hispanic Broadcasting Corporation;

2.

Based on my knowledge, this annual 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 annual report;

3.

Based on my knowledge, the financial statements, and other financial information included in this annual 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 annual report;

4.

The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)

designed such disclosure controls and procedures 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 annual report is being prepared;

b)

evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the "Evaluation Date"); and

c)

presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):

a)

all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.

The registrant's other certifying officers and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: March 31, 2003

/s/  MCHENRY T. TICHENOR, JR. McHenry T. Tichenor, Jr.
President and Chief Executive Officer

Certification

I, Jeffrey T. Hinson, certify that:

1.

I have reviewed this annual report on Form 10-K of Hispanic Broadcasting Corporation;

2.

Based on my knowledge, this annual 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 annual report;

3.

Based on my knowledge, the financial statements, and other financial information included in this annual 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 annual report;

4.

The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)

designed such disclosure controls and procedures 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 annual report is being prepared;

b)

evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the "Evaluation Date"); and

c)

presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):

a)

all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.

The registrant's other certifying officers and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: March 31, 2003

/s/  JEFFREY T. HINSON Jeffrey T. Hinson
Senior Vice President/Chief Financial Officer
Principal Financial Officer

EX-10.10

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Exhibit 10.10

AMENDMENT TO
LONG TERM INCENTIVE PLAN

March 31, 2003

        THIS AMENDMENT TO LONG TERM INCENTIVE PLAN (this "Amendment") is effective as set forth above and is made by the Board of Directors of Hispanic Broadcasting Corporation, a Delaware corporation (the "Company"). Each capitalized term that is not defined herein has the meaning given such term in the Long Term Incentive Plan (the "Plan").

W I T N E S S E T H:

WHEREAS, the Company has previously established the Plan for the benefit of eligible employees, director and other persons;

WHEREAS, pursuant to Section 12.2 of the Plan, the Board of Directors has the right to make certain amendments to the Plan;

WHEREAS, the Board of Directors desires to amend the Plan (a) to grant the Board discretion to provide that Awards become fully vested and exercisable in full upon the occurrence of a Change in Control and (b) to provide that each Nonstatutory Option held by the Non-employee Director at the date of the Change in Control may be exercised in whole or in part at any time within three years after the date of the Change in Control or until the expiration of the Nonstatutory Option, whichever is earlier;

WHEREAS, such amendments are within the scope of the Board's powers;

NOW, THEREFORE, the Plan is hereby amended as follows:

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A new Section 10.5 is hereby added to the Plan to read in its entirety as follows:

        "10.5 Acceleration of Awards Upon a Change in Control.    Notwithstanding anything to the contrary in any Award Agreement or the Plan, the Committee shall have the right to provide that any or all outstanding Options shall immediately become fully vested and exercisable in full upon the occurrence of a Change in Control, and that the term of the balance of such award shall continue for a period of time not to exceed the term set forth in the applicable Award Agreement governing such award. If a Change in Control involves a Restructure or occurs in connection with a series of related transactions involving a Restructure and if such Restructure is in the form of a Non Surviving Event and as a part of such Restructure shares of stock, other securities, cash or property shall be issuable or deliverable in exchange for Stock, then the Holder of a Award shall be entitle to purchase or receive (in lieu of the Total Shares that the Holder would otherwise be entitled to purchase or receive), as appropriate for the form of Award, the number of shares of stock, other securities, cash or property to which that number of Total Shares would have been entitled in connection with such Restructure (and, for Options, at any aggregate exercise price equal to the Exercise Price that would have been payable if that number of Total Shares had been purchased on the exercise of the Option immediately before the consummation of the Restructure)."

2.

A new Section 5.7 is hereby added to the Plan to read in its entirety as follows:

        "5.7 Expiration of Directors' Awards Upon Change in Control.    Notwithstanding anything contrary in Section 5.4 hereof, if a Non-employee Director ceases to be a member of the Board of Directors due the consummation of a transaction (or series of transactions) that involves a Change in Control, each Nonstatutory Option held by the Non-employee Director at the date of the Change in Control may be

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exercised in whole or in part at any time within three years after the date of the Change in Control or until the expiration of the Nonstatutory Option, whichever is earlier."

3.

Except as stated above, the Plan shall continue to read in its current state.

IN WITNESS WHEREOF, this Amendment has been executed by a duly authorized officer of the Company as of the date first set forth above.

HISPANIC BROADCASTING CORPORATION a Delaware corporation
By:	/s/  MCHENRY T. TICHENOR, JR. McHenry T. Tichenor, Jr. President and Chief Executive Officer

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Exhibit 10.10

AMENDMENT TO LONG TERM INCENTIVE PLAN

EX-10.15

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Exhibit 10.15

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made as of the 2nd day of January, 2003, by and among BIG CITY RADIO, INC., a Delaware corporation ("BCR"), BIG CITY RADIO-CHI, L.L.C., a Delaware limited liability company ("BCR License Sub"; BCR, together with BCR License Sub, "Seller") and HBC ILLINOIS, INC., a Delaware corporation ("Purchaser").

WHEREAS, Seller is the licensee of radio broadcast station WXXY-FM, licensed to Highland Park, Illinois and authorized by the FCC to operate at 103.1 MHz (FCC Facility ID No. 74177) (the "Station");

WHEREAS, Seller owns the assets which are used in the operation of the Station;

WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to purchase from Seller, certain of the radio station properties and assets relating to the Station as described herein under the terms and conditions herein set forth;

WHEREAS, Hispanic Broadcasting Corporation ("HBC"), of which Purchaser is a subsidiary, Univision Communications Inc. ("Univision") and Univision Acquisition Corporation ("Merger Sub") entered into that certain Agreement and Plan of Reorganization dated as of June 11, 2002, pursuant to which Merger Sub will merge with and into HBC (the "Merger") and HBC will become a wholly-owned subsidiary of Univision;

WHEREAS, on November 4, 2002, Seller publicly announced that Seller intended to market and conduct an auction of all of Seller's radio stations in order to satisfy certain financial obligations of Seller; and

WHEREAS, in order to ensure an orderly, timely and efficient consummation of the transactions contemplated herein, in light of the pending Merger and Seller's auction process, Purchaser has designated Designated Licensee as the assignee of the FCC Licenses and certain other assets of the Station.

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements herein contained, the parties hereto agree as follows:

ARTICLE 1.
DEFINITIONS AND REFERENCES

        Capitalized terms used herein without definition shall have the respective meanings assigned thereto in Annex I attached hereto and incorporated herein for all purposes of this Agreement (such definitions to be equally applicable to both the singular and plural forms of the terms defined). Unless otherwise specified, all references herein to "Articles" or "Sections" are to Articles or Sections of this Agreement. The word "include", "includes" and "including" shall be deemed to be followed by the phrase "without limitation".

ARTICLE 2.
PURCHASE AND SALE

2.1.    Purchase and Sale of Assets.

        Subject to the conditions set forth in this Agreement, at the Closing, Seller shall assign, transfer, convey and deliver to Purchaser (or, as designated by Purchaser, to Designated Licensee), and Purchaser shall purchase and accept from Seller, all right, title and interest of Seller in and to the following assets relating to the Station (the "Purchased Assets"), free and clear

of all Liens (other than Permitted Liens):

2.1.1.    FCC Licenses.

        All licenses, construction permits or authorizations issued by or pending before the FCC for use in the operation of the Station that are set forth on Schedule 2.1.1 attached hereto, together with any and all renewals, extensions and modifications thereof (the "FCC Licenses").

2.1.2.    Leased Transmitter Site.

        The leasehold interests of Seller at the Station's transmitter site located in Arlington Heights, Illinois, as described on Schedule 2.1.2 hereto (the "Leased Transmitter Site").

2.1.3.    Transmitter Equipment.

        The equipment and other tangible personal property owned by Seller and located, or otherwise held for use, at the Leased Transmitter Site that are set forth on Schedule 4.7 hereto, together with replacements thereof and additions thereto made between the date hereof and the Closing.

2.1.4.    Studio Equipment.

        All studio equipment, production and imaging equipment, office equipment, furniture, vehicles and other items of tangible personal property owned by Seller and used, or held for use, in the operation of the Station that are set forth on Schedule 4.7 hereto, together with replacements thereof and additions thereto made between the date hereof and the Closing.

2.1.5.    Certain Intangible Property.

        The call letters, Marti frequencies, trade names (listed on Schedule 2.1.5 hereto) and internet domain names of the Station.

2.1.6.    Business Records.

        Unless as may be otherwise required by Law, the books and records related to the Purchased Assets, such as property tax records, logs, all materials maintained in the FCC public file relating to the Station, technical data, political advertising records and all other records, correspondence with and documents pertaining to governmental authorities and similar third parties (the "Business Records").

2.1.7.    Assumed Contract.

        The lease for the Leased Transmitter Site listed on Schedule 2.1.7 hereto (the "Assumed Contract").

2.1.8.    Certain Promotional Materials.

        All promotional materials that incorporate the trade name "Viva" that are located at the Station as of the Closing Date.

        Purchaser may designate that Seller convey and transfer at the Closing to Designated Licensee the FCC Licenses and certain of the other Purchased Assets; provided, however, that Seller shall in no case be deemed to have made any representations or warranties to Designated Licensee with respect to any of the Purchased Assets so conveyed and transferred; provided, further, however, that no such conveyance or transfer to the Designated Licensee shall cause any delay of the Closing.

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2.2.    Excluded Assets.

        Notwithstanding the terms of Section 2.1, Seller shall not assign, transfer, convey or deliver to Purchaser, and Purchaser shall not purchase and accept, and the Purchased Assets shall not include, any of Seller's right, title and interest in and to any of the following assets (the "Excluded Assets"):

2.2.1.    Cash.

        All cash and cash equivalents of Seller or the Station on hand on the day immediately preceding the Closing Date.

2.2.2.    Accounts Receivables.

        Any accounts receivable, notes receivable or other receivables of Seller (including Tax refunds).

2.2.3.    Deposits and Prepaid Expenses.

        All deposits and prepaid expenses of the Station.

2.2.4    Intellectual Property.

        Except as specifically set forth in Section 2.1 above, all intellectual property of Seller related to the operation of the Station, including promotional materials, tapes, record libraries and similar items of intellectual property.

2.2.5.    Certain Books and Records.

        Seller's corporate seal, minute books, charter documents, corporate stock record books and other books and records that pertain to the organization of Seller.

2.2.6.    Securities.

        All securities of any kind owned by Seller.

2.2.7.    Insurance.

        All insurance contracts or proceeds thereof.

2.2.8.    Excluded Studio Site.

        The leasehold interest of Seller in the studio site located at Michigan Avenue, Chicago, Illinois (the "Excluded Studio Site").

2.2.9.    Additional Excluded Site.

        The leasehold interest of Seller in the premises located at 210 Skokie Valley Road, Highland Park, Illinois (the "Additional Excluded Site"), and all broadcast towers, antennas, transmitters, generators, STLs and other tangible personal property located, or otherwise intended for use, at the Additional Excluded Site.

2.2.10.    Morris Station Assets.

        Seller's assets used primarily in connection with the operation of the Morris Station.

2.2.11.    Other Agreements.

        Any agreements other than the Assumed Contract.

2.2.12.    Pre-Closing Claims.

        All claims arising out of acts occurring prior to the Closing Date, or claims that relate to the period prior to the Closing Date.

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2.2.13.    Rights Under this Agreement.

        All of the rights of Seller under or pursuant to this Agreement or any other rights in favor of Seller pursuant to the other agreements contemplated hereby or thereby.

2.2.14.    Employee Benefit Plans.

        All pension, profit sharing, retirement, bonus, medical, dental, life, accident insurance, disability, executive or deferred compensation, and other similar fringe or employee benefit plans.

2.2.15.    Other Excluded Assets.

        Any other assets of Seller not specifically identified in Section 2.1 of this Agreement.

2.3.    Assumed Contract.

        At the Closing, Purchaser shall assume the obligations of Seller for periods on and after the Closing Date under the Assumed Contract, and Purchaser agrees to pay and perform the Assumed Contract from and after the Closing Date. Except as specifically set forth in the preceding sentence, Purchaser does not assume and shall in no event be liable for any Liability of the Station or Seller.

ARTICLE 3.
PURCHASE PRICE; CLOSING

3.1.    Purchase Price.

        The purchase price for the Purchased Assets shall be Thirty-Two Million Eight Hundred Seventy-Five Thousand Dollars ($32,875,000) (the "Purchase Price"). Purchaser shall pay the Purchase Price in cash to Seller at Closing by wire transfer of immediately available funds to an account or accounts identified by Seller in writing prior to Closing.

3.2.    Time of Closing.

        The closing for the sale and purchase of the Purchased Assets (the "Closing") shall be held at the offices of Hogan & Hartson L.L.P., 8300 Greensboro Drive, Suite 1100, McLean, Virginia 22102 (or such other place as may be agreed upon by the parties in writing). Subject to the satisfaction of the conditions precedent set forth in Article 7 and Article 8 of this Agreement, the Closing shall occur on such date (the "Closing Date") that is the fifth (5^th) Business Day after the date on which the FCC Order shall have been granted. The Closing shall be deemed to be effective as of 12:01 a.m. on the Closing Date.

3.3.    Closing Procedures.

        At the Closing, Seller shall deliver to Purchaser such bills of sale, instruments of assignment, transfer and conveyance and similar documents as Purchaser shall reasonably request. Against such delivery, Purchaser shall (a) pay the Purchase Price to Seller in accordance with Section 3.1 above and (b) execute and deliver an assumption agreement with respect to the Assumed Contract in a form reasonably acceptable to both Seller and Purchaser. Each party will cause to be prepared, executed and delivered all other documents required to be delivered by such party pursuant to this Agreement and all other appropriate and customary documents as another party or its counsel may reasonably request for the purpose of consummating the transactions contemplated by this Agreement. All actions taken at the Closing shall be deemed to have been taken simultaneously at the time the last of any such actions is taken or completed.

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3.4.    Allocation of Purchase Price.

3.4.1.    The Purchase Price shall be allocated among the Purchased Assets in a manner as mutually agreed to in writing between the parties, based upon an appraisal of the Purchased Assets by Bond & Pecaro (the fees of which firm shall be paid by Purchaser).

3.4.2.    Seller and Purchaser agree, pursuant to Section 1060 of the Code, that the Purchase Price shall be allocated in accordance with this Section 3.4, and that all Tax returns and reports shall be filed consistent with such allocation. Notwithstanding any other provision of this Agreement, the provisions of this Section 3.4 shall survive the Closing Date without limitation.

3.5.    Prorations.

3.5.1.    All items of income and expense arising from the operation of the Station with respect to the Purchased Assets and the Assumed Contract on or before the close of business on the Closing Date shall be for the account of Seller and thereafter shall be for the account of Purchaser. Proration of the items described below between Seller and Purchaser shall be effective as of 11:59 p.m., local time, on such date and shall occur as follows with respect to those rights, liabilities and obligations of Seller transferred to and assumed by Purchaser hereunder.

3.5.2.    Liability for state and local Taxes assessed on the Purchased Assets payable with respect to the tax year in which the Closing Date falls and the annual FCC regulatory fees for the Station payable with respect to the year in which the Closing Date falls shall each be prorated as between Seller and Purchaser on the basis of the number of days of the Tax year elapsed to and including the Closing Date.

3.5.3.    Prepaid items, deposits, credits and accruals such as water, electricity, telephone, other utility and service charges, lease expenses, license fees (if any) and payments under any contracts or utility services to be assumed by Purchaser shall be prorated between Seller and Purchaser on the basis of the period of time to which such liabilities, prepaid items and accruals apply.

3.5.4.    All prorations shall be made and paid insofar as feasible on the Closing Date; any prorations not made on such date shall be made as soon as practicable (not to exceed ninety (90) days) thereafter. Seller and Purchaser agree to assume, pay and perform all costs, liabilities and expenses allocated to each of them pursuant to this Section 3.5.

ARTICLE 4.
REPRESENTATIONS AND WARRANTIES OF SELLER

        Seller hereby represents and warrants to Purchaser as follows:

4.1.    Organization; Good Standing.

        BCR License Sub is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of Delaware. BCR is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Seller has all requisite corporate power and authority to own and lease Seller's properties and carry on Seller's business as currently conducted.

4.2.    Due Authorization.

        Subject to the FCC Order and any requisite approval of BCR stockholders, Seller has full power and authority to enter into and perform this Agreement and to carry out the transactions contemplated hereby. Subject to obtaining any requisite approval of BCR stockholders, Seller has taken all necessary corporate action to approve the execution and delivery of this Agreement and the transactions contemplated hereby. This Agreement constitutes the legal, valid and binding obligation of Seller, enforceable against it in accordance with its terms, except as may be limited by the availability of

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equitable remedies or by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally.

4.3.    Execution and Delivery.

        Except as set forth on Schedule 4.3 hereto, neither the execution and delivery by Seller of this Agreement nor the consummation by Seller of the transactions contemplated hereby will: (a) conflict with or result in a breach of any provisions of Seller's organizational documents, (b) subject to the FCC Order, violate any Law or Order of any court or Governmental Authority, which violation would have a Material Adverse Effect; or (c) violate or conflict with or constitute a default under (or give rise to any right of termination, cancellation or acceleration under), or result in the creation of any Lien on any of the Purchased Assets pursuant to, any material agreement, indenture, mortgage or other instrument to which Seller is a party or by which Seller or Seller's assets may be bound or affected.

4.4.    Governmental Approvals.

        No approval, authorization, consent, order or other action of, or filing with, any court or Governmental Authority is required in connection with the execution and delivery by Seller of this Agreement or the consummation of the transactions contemplated hereby, other than those of the FCC.

4.5.    Title to Personal Property.

        Except for leased property, Seller is the sole and exclusive legal owner of all right, title and interest in, and has good and marketable title to, all of the Purchased Assets constituting personal property, free and clear of all Liens except (a) Permitted Liens, (b) Liens which will be released on or prior to the Closing, or (c) the Assumed Contract.

4.6.    Transmitter.

4.6.1.    Seller has a valid, binding and enforceable leasehold interest, which is free and clear of all Liens except for Permitted Liens, in and to the Leased Transmitter Site.

4.6.2.    Seller has not received any notice of, and has no knowledge of, any material violation of any zoning, building, health, fire, water use or similar Law in connection with the Leased Transmitter Site. To the knowledge of Seller, no fact or condition exists which would result in the termination or impairment of access of the Station to the Leased Transmitter Site or discontinuation of necessary sewer, water, electrical, gas, telephone or other utilities or services.

4.7.    Tangible Personal Property.

Schedule 4.7 sets forth a list, complete and accurate in all material respects, of the Purchased Assets which consist of tangible personal property. All of such tangible personal property, viewed as a whole and not on an asset by asset basis, are in good condition and working order, ordinary wear and tear excepted, and are suitable for the uses for which intended, free from any known defects except such minor defects that do not interfere with the continued present use thereof by Seller.

4.8.    FCC Licenses.

Schedule 2.1.1 lists and accurately describes all of the FCC Licenses necessary for the lawful ownership and operation of the Station and the conduct of its business, except where the failure to hold any such FCC License would not have a Material Adverse Effect. Seller has furnished to Purchaser true and accurate copies of all of the FCC Licenses. Each such FCC License is in full force and effect and is valid under applicable Laws; the Station is being operated in compliance in all material respects with the Communications Act, and all rules, regulations and policies of the FCC; and to the knowledge of Seller, no event has occurred which (whether with or without notice, lapse of time or the happening or occurrence of any other event) is reasonably likely to result in the revocation or

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termination of any FCC License or the imposition of any restriction of such a nature as would have a Material Adverse Effect, except for proceedings of a legislative or rule-making nature intended to affect the broadcasting industry generally. The Station, each of its physical facilities, electrical and mechanical systems and transmitting and studio equipment are being operated in all material respects in accordance with the specifications of the FCC Licenses. The FCC Licenses are unimpaired by any act or omission of Seller or any of Seller's officers, directors or employees and, Seller has fulfilled and performed all of Seller's material obligations with respect to the FCC Licenses and has full power and authority thereunder. Except as set forth on Schedule 2.1.1 with respect to the FCC Modification Application and the FCC Morris Modification Application, no application, action or proceeding is pending for the renewal or modification of any of the FCC Licenses. No event has occurred which, individually or in the aggregate, and with or without the giving of notice or the lapse of time or both, would constitute grounds for revocation thereof.

4.9.    Reports.

        Seller has duly filed all reports required to be filed by any Law or Order of any court or Governmental Authority and has made payment of all charges and other payments, if any, shown by such reports to be due and payable, except where the failure to so file or make payment would not, individually or in the aggregate, have a Material Adverse Effect. All reports required to be filed by Seller with the FCC with respect to the Station have been filed, except where the failure to so file would not have a Material Adverse Effect. Such reports and disclosures are complete and accurate in all material respects.

4.10.    Taxes.

        All Tax reports and returns required to be filed by or relating to the Purchased Assets have been filed with the appropriate Governmental Authority, and there have been paid all Taxes, penalties, interest, deficiencies, assessments or other charges due with respect to such Taxes, as reflected on the filed returns or claimed to be due by such federal, state or local taxing authorities (other than Taxes, deficiencies, assessments or claims which are being contested in good faith and which in the aggregate are not material). Seller has not received any written notice of any examinations or audits pending or unresolved examinations or audit issues with respect to Seller's federal, state or local Tax returns that could adversely affect the Purchased Assets. All additional Taxes, if any, assessed as a result of such examinations or audits have been paid, and to Seller's knowledge, there are no pending claims or proceedings relating to, or asserted for, Taxes, penalties, interest, deficiencies or assessments against the Purchased Assets.

4.11.    Environmental Matters.

4.11.1.    Except as would not reasonably be expected to have a Material Adverse Effect, with respect to the Purchased Assets, Seller is in compliance with all Environmental Laws.

4.11.2.    Except as would not reasonably be expected to have a Material Adverse Effect, there are no pending or, to the knowledge of Seller, threatened actions, suits, claims, or other legal proceedings based on (and Seller has not received any written notice of any complaint, order, directive, citation, notice of responsibility, notice of potential responsibility, or information request from any Governmental Authority arising out of or attributable to): (a) the current or past presence at any part of the Leased Transmitter Site of Hazardous Materials; (b) the current or past release or threatened release into the environment from the Leased Transmitter Site (including into any storm drain, sewer, septic system or publicly owned treatment works) of any Hazardous Materials; (c) the off-site disposal of Hazardous Materials originating on or from the Leased Transmitter Site; (d) any violation of Environmental Laws at any part of the Leased Transmitter Site arising from Seller's activities involving Hazardous Materials.

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4.11.3.    Except as would not reasonably be expected to have a Material Adverse Effect, Seller has been duly issued all permits, licenses, certificates and approvals required under any Environmental Law to operate the Purchased Assets as they are currently operated.

4.11.4.    Seller has made available to Purchaser all environmental assessments, reports, audits and other documents in Seller's possession or under Seller's control that relate to the Leased Transmitter Site or Seller's compliance with Environmental Laws with respect to the Purchased Assets.

4.11.5.    Notwithstanding any other provision of this Agreement, this Section 4.11 sets forth Seller's exclusive representations and warranties with respect to the environmental condition of the Purchased Assets, Seller's compliance with Environmental Laws, Hazardous Materials, Environmental Laws or other environmental matters. Notwithstanding any other provision of this Agreement, Purchaser hereby waives and releases all claims against Seller arising under Environmental Laws, including any statutory rights to contribution, with respect to the Purchased Assets.

4.12.    Litigation.

        There is no Order of any court or Governmental Authority and no action, suit, proceeding or investigation, judicial, administrative or otherwise that is pending or, to Seller's knowledge, threatened against or affecting the Station which, if adversely determined would have a Material Adverse Effect or which challenges the validity of any of the transactions contemplated by this Agreement.

4.13.    Contracts and Agreements.

        Seller is not in default in any material respect under any of the Assumed Contract, and, as of the Closing Date, Seller will have paid all sums and performed in all material respects all obligations under the Assumed Contract which are required to be paid or performed prior to the Closing Date.

4.14.    Business Records and Other Intangible Property.

        Seller has, and after the Closing, Purchaser will have, the right to use the Business Records, call letters, trade names and other intangible property included in the Purchased Assets, free and clear of any royalty or other payment obligations.

4.15.    Third Party Consents.

        Except as set forth in Section 4.4, the only consents from any Person which are required to be obtained by Seller in connection with the execution and delivery by Seller of this Agreement and the consummation of the transactions contemplated hereby are set forth on Schedule 4.15 (the "Third Party Consents").

4.16.    Finders and Brokers.

        Except for Jorgenson Broadcast Brokerage (the fees and expenses of which shall be borne solely by Seller), no person has as a result of any agreement entered into by Seller any valid claim against any of the parties hereto for a brokerage commission, finder's fee or other like payment.

4.17.    Disclaimer of Warranties; Limitations of Warranties.

        EXCEPT WITH RESPECT TO THE REPRESENTATIONS AND WARRANTIES SPECIFICALLY SET FORTH IN THIS AGREEMENT, SELLER MAKES NO WARRANTY, EXPRESS OR IMPLIED, WHETHER OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR QUALITY AS TO THE PURCHASED ASSETS, OR ANY PART THEREOF, OR AS TO THE CONDITION OR WORKMANSHIP THEREOF, OR THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR PATENT.

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ARTICLE 5.
REPRESENTATIONS AND WARRANTIES OF PURCHASER

        Purchaser hereby represents and warrants to Seller as follows:

5.1.    Organization and Good Standing.

        Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite power and authority to own and lease its properties and carry on its business as currently conducted.

5.2.    Due Authorization.

        Subject to the FCC Order, Purchaser has full power and authority to enter into this Agreement and to carry out Purchaser's obligations hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Purchaser. This Agreement has been duly executed and delivered by Purchaser and constitutes the legal, valid and binding obligation of Purchaser, enforceable against it in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally or general equitable principles.

5.3.    Execution and Delivery.

        Neither the execution and delivery by Purchaser of this Agreement nor the consummation of the transactions contemplated hereby will: (a) conflict with or result in a breach of the certificate of incorporation or bylaws of Purchaser; (b) subject to the FCC Order, violate any Law or Order of any court or Governmental Authority; or (c) violate or conflict with or constitute a default under (or give rise to any right of termination, cancellation or acceleration under) any indenture, mortgage, lease, contract or other instrument to which Purchaser is a party or by which Purchaser is bound or affected.

5.4.    Consents.

        No consent, approval, authorization, license, exemption of, filing or registration with any court or Governmental Authority is required in connection with the execution and delivery of this Agreement or the consummation by Purchaser of any transaction contemplated hereby, other than the consent of the FCC. No approval, authorization or consent of any other Person is required in connection with the execution and delivery by Purchaser of this Agreement and the consummation of the transactions contemplated hereby by Purchaser, except as may have been previously obtained by Purchaser.

5.5.    Finders and Brokers.

        No person has as a result of any agreement entered into by Purchaser any valid claim against any of the parties hereto for a brokerage commission, finder's fee or other like payment.

5.6.    Designated Licensee.

5.6.1.    To the knowledge of Purchaser, Designated Licensee is legally, financially and otherwise qualified to be the assignee of the FCC Licenses, and no waivers shall be required by the FCC for the consummation of the transactions contemplated hereby or the grant of the FCC Order. To the knowledge of Purchaser, there are no facts or proceedings which would reasonably be expected (a) to disqualify Designated Licensee under the Communications Act or otherwise from holding the FCC Licenses or (b) to cause the FCC not to approve the assignment of the FCC Licenses to Designated Licensee.

5.6.2.    To the knowledge of Purchaser, none of Purchaser, any Affiliate of Purchaser, Designated Licensee or any Affiliate of Designated Licensee shall be required to sell, dispose of or surrender any FCC license held by Purchaser, any Affiliate of Purchaser, Designated Licensee or any Affiliate of

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Designated Licensee with respect to any broadcast properties, or any other properties or businesses of Purchaser, any Affiliate of Purchaser, Designated Licensee or any Affiliate of Designated Licensee, as may be required under the Communications Act or the antitrust laws in order to consummate the sale and purchase of the Purchased Assets contemplated by this Agreement. For purposes of this Section 5.6.2, neither Clear Channel Communications, Inc. nor Univision, and their respective subsidiaries as of the date hereof, shall be deemed an Affiliate of Purchaser.

5.6.3.    To the knowledge of Purchaser:

        (a)  if Designated Licensee is an entity, Designated Licensee is duly organized, validly existing and in good standing under the laws of the state of Designated Licensee's formation or incorporation;

        (b)  the consummation of the transactions contemplated hereby have been duly authorized by all necessary action on the part of Designated Licensee;

        (c)  neither the execution and delivery by Purchaser of this Agreement nor the consummation of the transactions contemplated hereby will: (i) if Designated Licensee is an entity, conflict with or result in a breach of the organizational documents of Designated Licensee; or (ii) violate or conflict with or constitute a default under (or give rise to any right of termination, cancellation or acceleration under) any indenture, mortgage, lease, contract or other instrument to which Designated Licensee is a party or by which Designated Licensee is bound or affected; and

        (d)  no consent, approval, authorization, license, exemption of, filing or registration with any court or Governmental Authority is required in connection with the consummation by Designated Licensee of any transaction contemplated hereby, other than the consent of the FCC, and no approval, authorization or consent of any other Person is required in connection with the consummation of the transactions contemplated hereby by Designated Licensee.

5.7.    Financial Ability.

        Purchaser has, and on the Closing Date will have, cash available that is sufficient to enable Purchaser to consummate the transactions contemplated by this Agreement.

5.8.    HSR Matters.

        Purchaser, including all entities under common control with Purchaser as "control" is defined in 16 C.F.R. section 801.1(b), (a) does not hold any voting securities of Seller including any entity under common control with Seller as "control" is defined in 16 C.F.R. section 801.1(b) (collectively with the Seller the "Seller Entities") and (b) has not acquired any assets from any of the Seller Entities in the six (6) months prior to the date hereof. Purchaser has concluded under the requirements of 16 C.F.R. section 801.10(c)(3), that the fair market value of the Purchased Assets is less than Fifty Million Dollars ($50,000,000).

ARTICLE 6.
CERTAIN COVENANTS AND AGREEMENTS

6.1.    Regulatory Approvals.

6.1.1.    No later than one (1) Business Day after the date hereof, Seller and Purchaser shall jointly cause to be filed by Seller's FCC counsel an application with the FCC requesting the FCC's consent to the assignment of the FCC Licenses from BCR License Sub to Designated Licensee, which application is attached hereto at Exhibit A (the "FCC Assignment Application"). Each party shall pay its own expenses in connection with the preparation and prosecution of the FCC Assignment Application and shall share equally any filing fees associated with the FCC Assignment Application.

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6.1.2.    In addition to the FCC Assignment Application, Seller agrees to use reasonable best efforts to file the FCC Modification Application within three (3) Business Days after receipt thereof from Purchaser. The parties agree that the FCC Modification Application will be prosecuted with reasonable best efforts, in good faith and with due diligence. The parties agree to use their reasonable best efforts to file additional information or amendments requested by the FCC orally or in writing within five (5) Business Days after such request and, in any event, to commence preparation of such additional information or amendments immediately upon request and to complete and file the same with the FCC as promptly as practical. Purchaser will be responsible for the expenses incurred by the parties in the preparation, filing and prosecution of the FCC Modification Application, including filing fees and legal and engineering expenses. The parties acknowledge and agree that it shall not be a condition to Closing that the FCC shall have approved the FCC Modification Application.

6.1.3.    Upon the terms and subject to the conditions set forth in this Agreement, Seller and Purchaser shall each use their respective reasonable best efforts to promptly (a) take, or to cause to be taken, all actions, and to do, or to cause to be done, and to assist and cooperate with the other parties in doing all things necessary, proper or advisable under applicable Law or otherwise to consummate and make effective the transactions contemplated by this Agreement; (b) obtain from any Governmental Authority or other Person any actions, non-actions, clearances, waivers, consents, approvals, permits or Orders required to be obtained by Seller, Purchaser or any of their respective Affiliates in connection with the authorization, execution, delivery and performance of this Agreement, the consummation of the other transactions contemplated hereby and thereby and the assignment of the FCC Licenses from BCR License Sub to Designated Licensee; (c) furnish all information required for any application or other filing to be made pursuant to any applicable Law or any applicable regulations of any Governmental Authority in connection with the transactions contemplated by this Agreement, including filings in connection with the FCC Assignment Application, and to supply promptly any additional information and documentary material that may be requested in connection with such filings or applications; (d) avoid the entry of, or have vacated or terminated, any Order that would restrain, prevent or delay the Closing or the FCC Order, including defending against and opposing any lawsuits or other proceedings (including any FCC reconsideration or review), whether judicial or administrative, reviewing or challenging this Agreement, the consummation of the other transactions contemplated hereby and thereby or the assignment of the FCC Licenses from BCR License Sub to Designated Licensee; and (e) execute and deliver any additional instruments necessary to assign the FCC Licenses from BCR License Sub to Designated Licensee or to consummate any other transactions contemplated by this Agreement. No party to this Agreement shall consent to any voluntary delay of the assignment of the FCC Licenses from BCR License Sub to Designated Licensee or the consummation of the other transactions contemplated hereby at the behest of any Governmental Authority or other Person without the consent of the other party, which consent shall not be unreasonably withheld, conditioned or delayed. Without limiting this Section 6.1.3, Purchaser agrees to take any and all steps and to make any and all undertakings necessary to (i) avoid or eliminate each and every impediment under any antitrust, merger control, competition, or trade regulation Law, including the Communications Act, that may be asserted by any Governmental Authority with respect to consummation of the transactions contemplated by this Agreement and (ii) resolve any objection that may be asserted by the FCC or any other Person in order to obtain promptly the FCC Order or satisfy or comply with any conditions imposed by the FCC Order, in all events so as to enable the Closing to occur as soon as reasonably possible, including proposing, negotiating, committing to, and effecting by consent decree, hold separate order, or otherwise, the sale, divestiture, licensing or disposition of such assets of Purchaser or any of its Affiliates (including any FCC license held by such persons) or otherwise taking or committing to take actions that limit Purchaser's or its Affiliates' freedom of action with respect to, or their ability to retain, any of their assets, in each case, as may be required in order to obtain the FCC Order or avoid the entry of, or to effect the dissolution of, any

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injunction, temporary restraining order, or other Order in any suit or proceeding, which would otherwise have the effect of preventing or delaying the Closing.

6.1.4.    Notwithstanding anything in this Agreement to the contrary, if the Closing occurs before the FCC Order becomes a Final Order, the terms of Section 6.1.3 shall survive the Closing until the FCC Order becomes a Final Order; provided, however, that such terms shall only survive as applied to actions relating to the obtaining of the FCC Order and such FCC Order becoming a Final Order. No assignment of the FCC Licenses shall occur prior to obtaining the FCC Order.

6.2.    Third Party Consents and Notices.

6.2.1.    Seller will use its reasonable best efforts to obtain all Third Party Consents as promptly as practicable after the date of this Agreement. All Third Party Consents shall be in form reasonably satisfactory to Purchaser, and none shall provide for any increase in cost or other change in terms and conditions after the Closing which would be adverse to Purchaser.

6.2.2.    Prior to Closing, Seller shall provide written notice to third parties which have entered into material contracts with the Station (other than the Assumed Contract) regarding (a) the existence of this Agreement and the transactions contemplated hereby and (b) that Purchaser is not assuming any obligations of Seller or the Station in respect of the contracts with such third parties. Seller shall promptly provide copies of these written notices to Purchaser.

6.3.Access to Information.

        From the date hereof until the Closing (upon reasonable notice to Seller), during normal business hours, Seller shall, and shall cause its officers, directors, employees, auditors and agents to, (a) afford the officers, employees and authorized agents and representatives of Purchaser reasonable access to the offices, properties, books and records of Seller to the extent related to the Purchased Assets, and (b) furnish to the officers, employees and authorized agents and representatives of Purchaser such additional information regarding the Purchased Assets and the Station (including regularly prepared financial statements of the Station) as Purchaser may from time to time reasonably request in order to assist Purchaser in fulfilling its obligations under this Agreement and Purchaser's reporting obligations under applicable rules and regulations of the Securities and Exchange Commission, and to facilitate the consummation of the transactions contemplated hereby; provided, however, that (i) such investigation shall not unreasonably interfere with any of the businesses or operations of Seller or the Station and (ii) it is understood that Seller is not making any representations or warranties as to any financial statements of the Station furnished to Purchaser.

6.4.    Confidentiality.

        The terms of the confidentiality agreement previously executed between the parties (the "Confidentiality Agreement") between Seller and Purchaser are hereby incorporated herein by reference and shall continue in full force and effect until the Closing, at which time such Confidentiality Agreement and the obligations of Purchaser under this Section 6.4 shall terminate; provided, however, that the Confidentiality Agreement shall terminate only in respect of that portion of the Evaluation Material (as defined in the Confidentiality Agreement) exclusively relating to the transactions contemplated by this Agreement and the Purchased Assets. If this Agreement is, for any reason, terminated prior to the Closing, the Confidentiality Agreement shall nonetheless continue in full force and effect.

6.5.    Public Announcements.

        Seller and Purchaser shall consult with each other before issuing any press release or otherwise making any public statements with respect to this Agreement or the transactions contemplated herein and shall not issue any such press release or make any such public statement without the prior written consent of the other party, which shall not be unreasonably withheld, conditioned or delayed; provided,

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however, that a party may, without the prior written consent of the other party, issue such press release or make such public statement as may be required by Law or any listing agreement with a national securities exchange to which Seller or Purchaser is a party if it has used all reasonable efforts to consult with the other party and to obtain such party's consent but has been unable to do so in a timely manner.

6.6.    Ordinary Course of Business.

        During the period from the date hereof to the Closing Date, unless the prior consent of Purchaser is first obtained, Seller shall cause the Station to not knowingly take any action which would cause the conditions set forth in Section 7.1 and Section 7.2 not to be satisfied as of the Closing Date.

6.7.    Control of the Station.

        Prior to the Closing, Purchaser shall not, directly or indirectly, control, supervise, direct, or attempt to control, supervise, or direct, the operations of the Station; such operations, including complete control and supervision of the Station programs, employees, and policies, shall be the sole responsibility of Seller until the Closing.

6.8.    Risk of Loss.

        Seller shall bear the risk of all damage to, loss of or destruction of any of the Purchased Assets between the date of this Agreement and the Closing Date. If any material portion of the Purchased Assets (other than items that are obsolete and not necessary for the continued operations of the Station) shall suffer any material damage or destruction prior to the Closing Date, Seller shall promptly notify Purchaser in writing of such damage or destruction, shall promptly take all necessary steps to restore, repair or replace such assets at Seller's sole expense, and shall advise Purchaser in writing of the estimated cost to complete such restoration, repair or replacement and all amounts actually paid as of the date of the estimate. If necessary and provided that Seller is diligently pursuing such restoration, repair or replacement, the Closing Date shall be extended for a period up to the Outside Date to accomplish such restoration, repair or replacement.

6.9.    Morris Station.

        Within a reasonable period of time after the date hereof, Seller agrees to file, at Purchaser's sole cost and expense, an application with the FCC proposing to modify the directional antenna for the Morris Station at Seller's current transmitter site in Morris, Illinois, in accordance with the engineering specifications set forth on Schedule 6.9 hereto (the "FCC Morris Modification Application"). The parties acknowledge and agree that it shall not be a condition to Closing that the FCC shall have approved the FCC Morris Modification Application. Moreover, the parties acknowledge and agree that Seller may sell and assign its rights in the Morris Station, and that Seller's obligations pursuant to this Section 6.9 shall apply only so long as Seller or a subsidiary of Seller is the licensee of both the Station and the Morris Station. For so long as this Agreement remains in effect, Seller covenants and agrees to cause any assignee of the FCC licenses for the Morris Station to agree, for the direct benefit of Purchaser, to assume Seller's obligations under this Section 6.9; provided, however, that upon any such assignment of the FCC licenses for the Morris Station to a third party assignee, Seller shall have no Liability under this Section 6.9. In the event that any assignee of the FCC licenses for the Morris Station acquires such FCC licenses and, in connection therewith, assumes the obligations of Seller under this Section 6.9, Seller and such assignee shall not amend the obligations assumed without the prior written consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed.

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ARTICLE 7.
CONDITIONS TO PURCHASER'S CLOSING

        The obligations of Purchaser to purchase the Purchased Assets and to proceed with the Closing are subject to the satisfaction (or waiver in writing by Purchaser) at or prior to the Closing of each of the following conditions:

7.1.    Representations and Warranties.

        The representations and warranties of Seller contained in this Agreement shall be true and correct as of the Closing Date with the same effect as though made at such time (except as contemplated or permitted by this Agreement), except in all cases where the failure of any representation or warranty to be true and correct would not have a Material Adverse Effect.

7.2.    Covenants.

        Seller shall have performed the covenants and agreements contained in this Agreement that are to be performed by Seller at or prior to the Closing, except in all cases where the failure to perform such covenants and agreements would not have a Material Adverse Effect.

7.3.    FCC Order.

        The FCC Order shall be in full force and effect (it being understood that Purchaser's obligations to consummate the transactions contemplated by this Agreement shall not be subject to the condition that the FCC Order be a Final Order).

7.4.    No Orders.

        No Order or temporary, preliminary or permanent injunction or restraining order shall have been entered by any Governmental Authority which expressly prohibits or materially restrains the transactions contemplated by this Agreement.

7.5.    Third Party Consents.

        Any Third Party Consents required for the assignment of the lease for the Leased Transmitter Site shall have been obtained without the imposition of any additional monetary obligations on Purchaser or any other conditions materially adverse to Purchaser.

7.6.    Closing Deliveries.

        Purchaser shall have received each of the documents or items required to be delivered to it pursuant to Section 9.1 hereof.

ARTICLE 8.
CONDITIONS TO SELLER'S CLOSING

        The obligations of Seller to sell, transfer, convey and deliver the Purchased Assets and to proceed with the Closing are subject to the satisfaction (or waiver in writing by Seller) at or prior to the Closing of the following conditions:

8.1.    Representations and Warranties.

        The representations and warranties of Purchaser contained in this Agreement shall be true and correct in all material respects as of the Closing Date with the same effect as though made at such time (except as contemplated or permitted by this Agreement).

8.2.    Covenants.

        Purchaser shall have performed in all material respects the covenants and agreements contained in this Agreement that are to be performed by Purchaser as of the Closing.

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8.3.    FCC Order.

        The FCC Order shall be in full force and effect (it being agreed and understood that Seller's obligations to consummate the transactions contemplated by this Agreement shall not be subject to the condition that the FCC Order be a Final Order).

8.4.    No Orders.

        No Order or temporary, preliminary or permanent injunction or restraining order shall have been entered by any Governmental Authority which expressly prohibits or materially restrains the transactions contemplated by this Agreement.

8.5.    Closing Deliveries.

        Seller shall have received each of the documents or items required to be delivered to it pursuant to Section 9.2.

ARTICLE 9.
DOCUMENTS TO BE DELIVERED AT CLOSING

9.1.    Delivery by Seller.

        At the Closing, Seller shall deliver to Purchaser the following:

9.1.1.    The bills of sale, agreements of assignment and similar instruments of transfer to the Purchased Assets contemplated by Section 3.3 hereto.

9.1.2.    A certificate, signed by an executive officer of Seller, as to the fulfillment of the conditions set forth in Section 7.1 and Section 7.2 hereof.

9.1.3.    The Business Records.

9.2.    Delivery by Purchaser.

        At the Closing, Purchaser shall deliver to Seller the following:

9.2.1.    The Purchase Price in the amount and manner set forth in Section 3.1.

9.2.2.    A certificate, signed by an executive officer of Purchaser, as to the fulfillment of the conditions set forth in Section 8.1 and Section 8.2 hereof.

9.2.3.    An assumption agreement pursuant to which Purchaser shall assume the Assumed Contract.

ARTICLE 10.
TERMINATION

10.1.    Termination.

        This Agreement may be terminated by the mutual written agreement of Purchaser and Seller, or, if the terminating party is not then in material breach of its obligations hereunder, upon written notice as follows:

10.1.1.    by Purchaser if Seller is in material breach of its obligations hereunder, such that the conditions set forth in Section 7.1 and Section 7.2 would not be satisfied as of the Closing, and such breach has not been cured by Seller within thirty (30) days of written notice of such breach (or such longer period of time if the breach cannot be reasonably cured within thirty (30) days and Seller is diligently attempting to cure such breach);

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10.1.2.    by Seller if Purchaser is in material breach of its obligations hereunder, such that the conditions set forth in Section 8.1 and Section 8.2 would not be satisfied as of the Closing, and such breach has not been cured by Purchaser within thirty (30) days of written notice of such breach (or such longer period of time if the breach cannot be reasonably cured within thirty (30) days and Purchaser is diligently attempting to cure such breach);

10.1.3.    by either Purchaser or Seller if the FCC denies the FCC Assignment Application in an order that has become a Final Order, or has designated the FCC Assignment Application for a hearing; or

10.1.4.    by either Purchaser or Seller if the Closing has not occurred on or before such date which is six (6) months after the date of this Agreement (the "Outside Date").

10.2.    Effect of Termination.

        In the event of termination of this Agreement pursuant to Section 10.1 above, all rights and obligations of the parties under this Agreement shall terminate without any liability of any party to any other party (except for any liability of any party for any material breach of this Agreement, in which case any non-breaching party shall have all rights and remedies available at law or in equity). Notwithstanding anything to the contrary contained herein, the provisions of Sections 6.4 and 11.4 shall expressly survive the termination of this Agreement.

ARTICLE 11.
MISCELLANEOUS PROVISIONS

11.1.    Survival.

        The representations and warranties in this Agreement shall terminate at, and will have no further force and effect after, the Closing. No covenants or agreements of the parties contained in this Agreement shall survive the Closing, except that covenants that contemplate or may involve actions to be taken or obligations in effect after the Closing shall survive in accordance with their terms.

11.2.    Specific Performance.

        The parties acknowledge that the Purchased Assets and the transactions contemplated hereby are unique, that a failure by Seller or Purchaser to complete such transactions will cause irreparable injury to the other, and that actual damages for any such failure may be difficult to ascertain and may be inadequate. Consequently, Seller and Purchaser agree that each shall be entitled, in the event of a default by the other, to specific performance of any of the provisions of this Agreement in addition to any other legal or equitable remedies to which the non-defaulting party may otherwise be entitled. In the event any action is brought, the prevailing party shall be entitled to recover court costs and reasonable attorneys' fees.

11.3.    Additional Actions, Documents and Information.

        Purchaser agrees that it will, at any time, prior to, at or after the Closing Date, take or cause to be taken such further actions, and execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments and obtain such consents, as may be reasonably requested by Seller in connection with the consummation of the transactions contemplated by this Agreement. Seller agrees that it will, at any time, prior to, at or after the Closing Date, take or cause to be taken such further actions, and execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments and obtain such consents, as may be reasonably requested by Purchaser in connection with the consummation of the transactions contemplated by this Agreement.

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11.4.    Fees and Expenses.

        Except as otherwise expressly provided in this Agreement, all fees and expenses, including fees and expenses of counsel, financial advisors, and accountants incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such fee or expense, whether or not the Closing shall have occurred.

11.5.    Transfer Taxes.

        All sales, use, transfer, filing, recordation, registration and similar Taxes and fees arising from or associated with the transactions contemplated hereunder, whether levied on Purchaser or Seller, shall be borne by Purchaser. Purchaser or Seller, as required by Law, shall file all necessary documentation with respect to, and make all payments of, such taxes and fees on a timely basis; provided that Purchaser shall remit any funds necessary to pay such taxes and fees under this Section 11.5 in sufficient time to allow timely payment of any such taxes and fees.

11.6.    Notices.

        All notices, demands, requests, or other communications which may be or are required to be given or made by any party to any other party pursuant to this Agreement shall be in writing and shall be hand delivered, mailed by first-class registered or certified mail, return receipt requested, postage prepaid, delivered by overnight air courier, or transmitted by telegram, telex, or facsimile transmission addressed as follows:

        If to Purchaser:

Hispanic Broadcasting Corporation
3102 Oak Lawn Avenue, Suite 215
Dallas, Texas 75219
Attention: Jeffrey T. Hinson, Senior Vice President
Telephone: (214) 525-7711
Facsimile: (214) 525-7750

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

Hallett & Perrin, P.C.
2001 Bryan Street, Suite 3900
Dallas, Texas 75201
Attention: Bruce H. Hallett
Telephone: (214) 922-4120
Facsimile: (214) 922-4170

        If to Seller:

Big City Radio, Inc.
c/o Metromedia Company
One Meadowlands Plaza
East Rutherford, New Jersey 07073-2137
Attention: David A. Persing
Telephone: (201) 531-8022
Facsimile: (201) 531-2803

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

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Hogan & Hartson L.L.P.
8300 Greensboro Drive
Suite 1100
McLean, Virginia 22102
Attention: Thomas E. Repke
                  Richard T. Horan, Jr.
Telephone: (703) 610-6138
Facsimile: (703) 610-6200

or such other address as the addressee may indicate by written notice to the other parties.

        Each notice, demand, request, or communication which shall be given or made in the manner described above shall be deemed sufficiently given or made for all purposes at such time as it is delivered to the addressee (with the return receipt, the delivery receipt, the affidavit of messenger or (with respect to a telex) the answerback being deemed conclusive but not exclusive evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation.

11.7.    Waiver.

        No delay or failure on the part of any party hereto in exercising any right, power or privilege under this Agreement or under any other instrument or document given in connection with or pursuant to this Agreement shall impair any such right, power or privilege or be construed as a waiver of any default or any acquiescence therein. No single or partial exercise of any such right, power or privilege shall preclude the further exercise of such right, power or privilege, or the exercise of any other right, power or privilege. No waiver shall be valid against any party hereto unless made in writing and signed by the party against whom enforcement of such waiver is sought and then only to the extent expressly specified therein.

11.8.    Benefit and Assignment.

11.8.1.    No party hereto shall assign this Agreement, in whole or in part, whether by operation of law or otherwise, without the prior written consent of the other party hereto.

11.8.2.    Any purported assignment contrary to the terms hereof shall be null, void and of no force and effect. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns as permitted hereunder. No Person, other than the parties hereto, is or shall be entitled to bring any action to enforce any provision of this Agreement against any of the parties hereto, and the covenants and agreements set forth in this Agreement shall be solely for the benefit of, and shall be enforceable only by, the parties hereto or their respective successors and assigns as permitted hereunder.

11.9.    Entire Agreement; Amendment.

        This Agreement, including the Schedules and Exhibits hereto and the other instruments and documents referred to herein or delivered pursuant hereto contains the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior oral or written agreements, commitments or understandings with respect to such matters. No amendment, modification or discharge of this Agreement shall be valid or binding unless set forth in writing and duly executed by the party or parties against whom enforcement of the amendment, modification or discharge is sought.

11.10.    Severability.

        If any part of any provision of this Agreement or any other contract, agreement, document or writing given pursuant to or in connection with this Agreement shall be invalid or unenforceable under applicable law, such part shall be ineffective to the extent of such invalidity or unenforceability only,

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without in any way affecting the remaining parts of such provisions or the remaining provisions of said contract, agreement, document or writing.

11.11.    Headings.

        The headings of the sections and subsections contained in this Agreement are inserted for convenience only and do not form a part or affect the meaning, construction or scope thereof.

11.12.    Governing Law; Jurisdiction.

        This Agreement, the rights and obligations of the parties hereto, and any claims or disputes relating thereto, shall be governed by and construed under and in accordance with the laws of the State of New York, without giving effect to the conflicts of law principles thereof (other than Section 5-1401 of the New York General Obligations Law). The parties hereto hereby waive personal service of any process in connection with any such action, suit or proceeding and agree that the service thereof may be made by certified or registered mail addressed to or by personal delivery to the other party, at such other party's address set forth pursuant to Section 11.6 hereof. In the alternative, in its discretion, any of the parties hereto may effect service upon any other party in any other form or manner permitted by law.

11.13.    Signature in Counterparts.

        This Agreement may be executed in separate counterparts, none of which need contain the signatures of all parties, each of which shall be deemed to be an original, and all of which taken together constitute one and the same instrument. It shall not be necessary in making proof of this Agreement to produce or account for more than the number of counterparts containing the respective signatures of, or on behalf of, all of the parties hereto.

[The remainder of this page intentionally left blank.]

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

SELLER
BIG CITY RADIO, INC.
By:	/s/  P.R. THOMSON
Name:	P.R. Thomson
Title:	Vice President—CFO
BIG CITY RADIO-CHI, L.L.C.
By:	/s/  P.R. THOMSON
Name:	P.R. Thomson
Title:	Vice President—CFO
PURCHASER
HBC ILLINOIS, INC.
By:
Name:
Title:

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ANNEX I
DEFINITIONS

        "Accounts Receivables" shall mean all accounts receivable with respect to the Station as of the end of the broadcast day immediately preceding the Closing Date.

        "Additional Excluded Site" shall have the meaning set forth in Section 2.2.9.

        "Affiliates" of a party shall mean persons or entities that directly, or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, such party.

        "Agreement" shall have the meaning set forth in the Preamble.

        "Assumed Contract" shall have the meaning set forth in Section 2.1.7.

        "BCR" shall have the meaning set forth in the Preamble.

        "BCR License Sub" shall have the meaning set forth in the Preamble.

        "Business Day" shall mean a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close.

        "Business Records" shall have the meaning set forth in Section 2.1.6.

        "Closing" shall have the meaning set forth in Section 3.2.

        "Closing Date" shall have the meaning set forth in Section 3.2.

        "Code" shall mean the Internal Revenue Code of 1986, as amended, and all Laws promulgated pursuant thereto or in connection therewith.

        "Communications Act" shall mean the Communications Act of 1934, as amended.

        "Confidentiality Agreement" shall have the meaning set forth in Section 6.4.

        "Designated Licensee" shall mean Superior Broadcasting of Chicago, LLC.

        "Environmental Laws" shall mean the applicable provisions of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, ("CERCLA"); 42 U.S.C. § 9601 et seq.; the Toxic Substances Control Act ("TSCA"), 15 U.S.C. § 2601 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. § 5101 et seq.; the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6901 et seq.; the Clean Water Act ("CWA"), 33 U.S.C. § 1251 et seq.; the Safe Drinking Water Act, 42 U.S.C. § 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C. § 7401 et seq.; or any other applicable federal, state, or local laws relating to Hazardous Materials generation, production, use, storage, treatment, transportation or disposal, or the protection of the environment

        "Excluded Assets" shall have the meaning set forth in Section 2.2.

        "Excluded Studio Site" shall have the meaning set forth in Section 2.2.8.

        "FCC" shall mean the Federal Communications Commission.

        "FCC Assignment Application" shall have the meaning set forth in Section 6.1.1.

        "FCC Licenses" shall have the meaning set forth in Section 2.1.1.

        "FCC Modification Application" shall mean an FCC modification application requesting FCC consent to modifications to the signal and signal location for the Station, which application complies with all applicable FCC rules, regulations and policies, including all information necessary for Seller to make any certifications therein.

        "FCC Morris Modification Application" shall have the meaning set forth in Section 6.9.

Annex I-1

        "FCC Order" shall mean that the FCC (including the Media Bureau pursuant to delegated authority) has granted or given its consent, without any condition materially adverse to Purchaser or Seller, to the assignment of the FCC Licenses in accordance with the terms of the FCC Assignment Application.

        "Final Order" shall mean that the FCC Order shall have become final, that is, that the time period for filing any protests or requests or petitions for stay, reconsideration, rehearing, review or appeal by the FCC or a court of competent jurisdiction of such order and the time period for the FCC or its staff to have taken any actions to reconsider or review such order shall have expired, and that no timely protest or request or petition for stay, reconsideration, rehearing, review or appeal by the FCC or a court of competent jurisdiction or action by the FCC or its staff to reconsider or review such order shall be pending.

        "Governmental Authority" shall mean any court, arbitrator, department, commission, board, bureau, agency, authority, instrumentality or other body, whether federal, state, municipal, foreign or other.

        "Hazardous Materials" shall mean any wastes, substances, or materials (whether solids, liquids or gases) that are deemed hazardous, toxic, pollutants, or contaminants, including substances defined as "hazardous wastes", "hazardous substances", "toxic substances", "radioactive materials" or other similar designations in, or otherwise subject to regulation under, any Environmental Laws.

        "HBC" shall have the meaning set forth in the Recitals.

        "Law" shall mean any statute, law, ordinance, rule or regulation.

        "Leased Transmitter Site" shall have the meaning set forth in Section 2.1.2.

        "Liabilities" shall mean, as to any Person, all debts, adverse claims, liabilities and obligations, direct, indirect, absolute or contingent of such Person, whether accrued, vested or otherwise, whether in contract, tort, strict liability or otherwise and whether or not actually reflected, or required by generally accepted accounting principles to be reflected, in such Person's balance sheets or other books and records.

        "Liens" shall mean, statutory or otherwise, security interests, claims, pledges, licenses, equities, options, conditional sales contracts, assessments, levies, charges or encumbrances of any nature whatsoever.

        "Material Adverse Effect" or "material adverse effect" shall mean a material adverse effect on the Purchased Assets taken as a whole, but shall specifically exclude any material adverse effect caused by (a) factors affecting the radio industry generally or the market in which the Station operates, (b) general, national, regional or local economic or financial conditions, (c) new governmental Laws, (d) the failure to achieve any financial or operational targets, projections or milestones set forth in any Seller business plan or budget, or (e) liquidity or cash flow deficiencies affecting Seller's business, properties, assets, liabilities, financial condition, results of operations, properties or prospects.

        "Merger" shall have the meaning set forth in the Recitals.

        "Merger Sub" shall have the meaning set forth in the Recitals.

        "Morris Station" shall mean radio broadcast station WYXX(FM) licensed to Morris, Illinois.

        "Order" shall mean any order, writ, injunction, judgment, plan or decree of any Governmental Authority.

        "Outside Date" shall have the meaning set forth in Section 10.1.4.

Annex I-2

        "Permitted Liens" shall mean (a) Liens for taxes not yet due and payable; (b) landlord's Liens and Liens for property taxes not delinquent; (c) statutory Liens that were created in the ordinary course of business and which are not delinquent; (d) restrictions or rights granted to Governmental Authorities under applicable Law to the extent not arising pursuant to any defaults thereunder; (e) zoning, building, or similar restrictions relating to or affecting property which do not arise in connection with a violation of applicable Law; (f) Liens on the Leased Transmitter Site that do not materially affect the current use and enjoyment thereof in the operation of the Station or the value of the Leased Transmitter Site; (g) customary utility and similar easements affecting property; and (h) Liens for which a proration adjustment is made pursuant to Section 3.5 of this Agreement.

        "Person" or "person" shall mean any individual, corporation, partnership, limited liability company, joint venture, trust, unincorporated organization, other form of business or legal entity or Governmental Authority.

        "Purchase Price" shall have the meaning set forth in Section 3.1.

        "Purchased Assets" shall have the meaning set forth in Section 2.1.

        "Purchaser" shall have the meaning set forth in the Preamble.

        "Seller" shall have the meaning set forth in the Preamble.

        "Seller Entities" shall have the meaning set forth in Section 5.8.

        "Station" shall have the meaning set forth in the Recitals.

        "Taxes" shall mean all federal, state and local taxes (including income, profit, franchise, sales, use, real property, personal property, ad valorem, excise, employment, social security and wage withholding taxes) and installments of estimated taxes, assessments, deficiencies, levies, imports, duties, license fees, registration fees, withholdings, or other similar charges of every kind, character or description imposed by any Governmental Authorities.

        "Third Party Consents" shall have the meaning set forth in Section 4.15.

        "Univision" shall have the meaning set forth in the Recitals.

Annex I-3

ASSET PURCHASE AGREEMENT

BY AND AMONG

BIG CITY RADIO, INC.,

BIG CITY RADIO-CHI, L.L.C.

as Seller,

and

HBC Illinois, Inc.

as Purchaser

Dated as of January 2, 2003

TABLE OF CONTENTS

			Page
ARTICLE 1. DEFINITIONS AND REFERENCES			1
ARTICLE 2. PURCHASE AND SALE			1
2.1.	Purchase and Sale of Assets.		1
	2.1.1.	FCC Licenses.	2
	2.1.2.	Leased Transmitter Site.	2
	2.1.3.	Transmitter Equipment.	2
	2.1.4.	Studio Equipment.	2
	2.1.5.	Certain Intangible Property.	2
	2.1.6.	Business Records.	2
	2.1.7.	Assumed Contract.	2
	2.1.8.	Certain Promotional Materials.	2
2.2.	Excluded Assets.		3
	2.2.1.	Cash.	3
	2.2.2.	Accounts Receivables.	3
	2.2.3.	Deposits and Prepaid Expenses.	3
	2.2.4	Intellectual Property.	3
	2.2.5.	Certain Books and Records.	3
	2.2.6.	Securities.	3
	2.2.7.	Insurance.	3
	2.2.8.	Excluded Studio Site.	3
	2.2.9.	Additional Excluded Site.	3
	2.2.10.	Morris Station Assets.	3
	2.2.11.	Other Agreements.	3
	2.2.12.	Pre-Closing Claims.	3
	2.2.13.	Rights Under this Agreement.	4
	2.2.14.	Employee Benefit Plans.	4
	2.2.15.	Other Excluded Assets.	4
2.3.	Assumed Contract.		4
ARTICLE 3. PURCHASE PRICE; CLOSING			4
3.1.	Purchase Price.		4
3.2.	Time of Closing.		4
3.3.	Closing Procedures.		4
3.4.	Allocation of Purchase Price.		5
3.5.	Prorations.		5
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF SELLER			5
4.1.	Organization; Good Standing.		5
4.2.	Due Authorization.		5
4.3.	Execution and Delivery.		6
4.4.	Governmental Approvals.		6
4.5.	Title to Personal Property.		6
4.6.	Transmitter.		6
4.7.	Tangible Personal Property.		6
4.8.	FCC Licenses.		6
4.9.	Reports.		7
4.10.	Taxes.		7
4.11.	Environmental Matters.		7
4.12.	Litigation.		8
4.13.	Contracts and Agreements.		8
4.14.	Business Records and Other Intangible Property.		8
4.15.	Third Party Consents.		8

4.16.	Finders and Brokers.	8
4.17.	Disclaimer of Warranties; Limitations of Warranties.	8
ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF PURCHASER		9
5.1.	Organization and Good Standing.	9
5.2.	Due Authorization.	9
5.3.	Execution and Delivery.	9
5.4.	Consents.	9
5.5.	Finders and Brokers.	9
5.6.	Designated Licensee.	9
5.7.	Financial Ability.	10
5.8.	HSR Matters.	10
ARTICLE 6. CERTAIN COVENANTS AND AGREEMENTS		10
6.1.	Regulatory Approvals.	10
6.2.	Third Party Consents and Notices.	12
6.3.	Access to Information.	12
6.4.	Confidentiality.	12
6.5.	Public Announcements.	12
6.6.	Ordinary Course of Business.	13
6.7.	Control of the Station.	13
6.8.	Risk of Loss.	13
ARTICLE 7. CONDITIONS TO PURCHASER'S CLOSING		14
7.1.	Representations and Warranties.	14
7.2.	Covenants.	14
7.3.	FCC Order.	14
7.4.	No Orders.	14
7.5.	Third Party Consents.	14
7.6.	Closing Deliveries.	14
ARTICLE 8. CONDITIONS TO SELLER'S CLOSING		14
8.1.	Representations and Warranties.	14
8.2.	Covenants.	14
8.3.	FCC Order.	15
8.4.	No Orders.	15
8.5.	Closing Deliveries.	15
ARTICLE 9. DOCUMENTS TO BE DELIVERED AT CLOSING		15
9.1.	Delivery by Seller.	15
9.2.	Delivery by Purchaser.	15
ARTICLE 10. TERMINATION		15
10.1.	Termination.	15
10.2.	Effect of Termination.	16
ARTICLE 11. MISCELLANEOUS PROVISIONS		16
11.1.	Survival.	16
11.2.	Specific Performance.	16
11.3.	Additional Actions, Documents and Information.	16
11.4.	Fees and Expenses.	17
11.5.	Transfer Taxes.	17
11.6.	Notices.	17
11.7.	Waiver.	18
11.8.	Benefit and Assignment.	18
11.9.	Entire Agreement; Amendment.	18
11.10.	Severability.	18
11.11.	Headings.	19
11.12.	Governing Law; Jurisdiction.	19
11.13.	Signature in Counterparts.	19

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Exhibit 10.15

ASSET PURCHASE AGREEMENT
ARTICLE 1. DEFINITIONS AND REFERENCES
ARTICLE 2. PURCHASE AND SALE
ARTICLE 3. PURCHASE PRICE; CLOSING
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF SELLER
ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF PURCHASER
ARTICLE 6. CERTAIN COVENANTS AND AGREEMENTS
ARTICLE 7. CONDITIONS TO PURCHASER'S CLOSING
ARTICLE 8. CONDITIONS TO SELLER'S CLOSING
ARTICLE 9. DOCUMENTS TO BE DELIVERED AT CLOSING
ARTICLE 10. TERMINATION
ARTICLE 11. MISCELLANEOUS PROVISIONS
ANNEX I DEFINITIONS
ASSET PURCHASE AGREEMENT BY AND AMONG BIG CITY RADIO, INC., BIG CITY RADIO-CHI, L.L.C. as Seller, and HBC Illinois, Inc. as Purchaser
Dated as of January 2, 2003
TABLE OF CONTENTS

EX-10.16

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Exhibit 10.16

FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT

THIS FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT (this "Amendment"), is made as of January 9^th, 2003, by and among BIG CITY RADIO, INC., a Delaware corporation ("BCR"), BIG CITY RADIO-CHI, L.L.C., a Delaware limited liability company ("BCR License Sub"; BCR, together with BCR License Sub, "Seller"), and HBC ILLINOIS, INC., a Delaware corporation ("Purchaser").

WHEREAS, Seller and Purchaser are parties to that certain Asset Purchase Agreement dated as of January 2, 2003 (the "Purchase Agreement"), pursuant to which Purchaser will acquire from Seller the Purchased Assets and Purchaser will assume the obligations of Seller under the Assumed Contract, all subject to the terms and conditions set forth in the Purchase Agreement;

WHEREAS, simultaneously with the execution and delivery of this Amendment, BCR License Sub and Purchaser are entering into a Time Brokerage Agreement pursuant to which BCR License Sub will retain Purchaser to provide programming and related services for the Station;

WHEREAS, in connection with the execution and delivery of the Time Brokerage Agreement, Purchaser and Seller desire to make certain modifications to the Purchase Agreement; and

WHEREAS, all capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Purchase Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements herein contained, the parties hereto agree as follows:

        1.    Section 3.5.1, Section 3.5.2 and Section 3.5.3 of the Purchase Agreement are hereby amended by adding the phrase "Subject to the terms and conditions of the Time Brokerage Agreement" at the beginning of the first sentence of each such Section.

        2.    Section 6.6 of the Purchase Agreement is hereby amended by adding the phrase "Subject to the terms and conditions of the Time Brokerage Agreement and the obligations of the parties thereunder" at the beginning of the first sentence of such Section.

        3.    Section 6.7 of the Purchase Agreement is hereby amended by adding the phrase ", except as contemplated by the Time Brokerage Agreement" at the end of such Section.

        4.    Article 6 of the Purchase Agreement is hereby amended by adding Section 6.10, the text of which reads as follows:

        "6.10. Time Brokerage Agreement.

        Notwithstanding anything to the contrary contained in this Agreement or otherwise, Seller shall not be deemed to have breached or failed to comply with any representations, warranties, covenants, or agreements with respect to the Station or the Purchased Assets if such breach or failure is due or caused directly by any act, omission or instruction of Purchaser under or in connection with the Time Brokerage Agreement or any activities or transactions by Purchaser in furtherance thereof or in connection therewith or any actions of Seller in accordance with the terms of the Time Brokerage Agreement (except for such actions of Seller that constitute gross negligence or willful misconduct)."

        5.    Section 10.1 of the Purchase Agreement is hereby amended by adding Section 10.1.5 and Section 10.1.6, the text of which read as follows:

        "10.1.5. by Seller if Purchaser is in breach of its obligations under the Time Brokerage Agreement, and (a) in the case of a breach by Purchaser thereunder to pay money to Seller, such breach has not been cured by Purchaser within five (5) days of written notice of such breach; and (b) in the case of any other breach by Purchaser thereunder, such breach has not been cured by Purchaser within thirty (30) days of written notice of such breach (or such longer period of time if

the breach cannot be reasonably cured within thirty (30) days and Purchaser is diligently attempting to cure such breach); or

10.1.6. by Purchaser if Seller is in material breach of its obligations under the Time Brokerage Agreement, and such breach has not been cured by Seller within thirty (30) days of written notice of such breach (or such longer period of time if the breach cannot be reasonably cured within thirty (30) days and Seller is diligently attempting to cure such breach)."

        6.    Annex I of the Purchase Agreement is hereby amended by adding the definition for "Time Brokerage Agreement", the text of which reads as follows:

        "Time Brokerage Agreement" shall mean the Time Brokerage Agreement between BCR License Sub and Purchaser dated as of January 10, 2003."

        7.    Except as expressly modified hereby, all other terms and conditions of the Purchase Agreement shall remain in full force and effect in accordance with their terms.

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

[The remainder of this page intentionally left blank.]

        IN WITNESS WHEREOF, each of the parties hereto has caused this First Amendment to Asset Purchase Agreement to be executed as of the date first written above.

BIG CITY RADIO, INC.
By:	/s/  THOMAS E. REPKE
Name:	Thomas E. Repke
Title:	Executive Vice President, General Counsel and Secretary
BIG CITY RADIO-CHI, L.L.C.
By:	BIG CITY RADIO, INC., Its Managing Member
By:	/s/  THOMAS E. REPKE
Name:	Thomas E. Repke
Title:	Executive Vice President, General Counsel and Secretary
HBC ILLINOIS, INC.
By:
Name:
Title:

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Exhibit 10.16

FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT

EX-10.17

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Exhibit 10.17

CONFIDENTIAL
STOCK PURCHASE AGREEMENT

        This Stock Purchase Agreement ("Agreement") is made as of February 13, 2003, by and between Hispanic Broadcasting Corporation, a Delaware corporation with principal offices located at 3102 Oak Lawn, Suite 215, Dallas, Texas 75219 ("Buyer"), and Fundación Angel Ramos, Inc., a Puerto Rico corporation with principal offices located at 383 F.D. Roosevelt Avenue, Hato Rey, Puerto Rico ("Seller").

RECITALS

WHEREAS, El Mundo Broadcasting Corporation, a corporation incorporated under the laws of Puerto Rico (the "Company"), is engaged in the radio broadcasting business in Puerto Rico.

WHEREAS, Seller desires to sell, and Buyer desires to purchase, all of the issued and outstanding shares of capital stock of the Company (the "Shares"), for the consideration and on the terms set forth in this Agreement.

AGREEMENT

NOW, THEREFORE, the parties, intending to be legally bound, agree as follows:

1.

DEFINITIONS

        For purposes of this Agreement, the following terms have the meanings specified or referred to in this Section 1:

"Adjustment Amount"—as defined in Section 2.5.

"Benefit Plans"—means any bonus, incentive compensation, deferred compensation, pension, profit sharing, retirement, stock purchase, stock option, stock ownership, stock appreciation rights, phantom stock, equity (or equity based), whether written or oral, and whether or not subject to ERISA (including, without limitation, any "employee benefit plan" within the meaning of Section 3(3) of ERISA), which the Company sponsors, maintains, has any obligation to contribute to, has liability under or to which it is otherwise a party and which covers or otherwise provides benefits to any of its employees or former employees (or their dependents and beneficiaries) with respect to their relationship with the Company's business

"Best Efforts"—the efforts that a prudent Person desirous of achieving a result would use in similar circumstances to ensure that such result is achieved as expeditiously as possible, provided, however, that an obligation to use Best Efforts under this Agreement does not require the Person subject to that obligation to take actions that would result in a materially adverse change in the benefits to such Person of this Agreement and the Contemplated Transactions.

"Buyer"—as defined in the first paragraph of this Agreement.

"Closing"—as defined in Section 2.3.

"Closing Date"—the date and time as of which the Closing actually takes place.

"Closing Date Adjustment Amount"—as defined in Section 2.6(b).

"Commonwealth"—Commonwealth of Puerto Rico.

"Communications Act"—the Communications Act of 1934, as amended.

"Company"—as defined in the Recitals of this Agreement.

"Consent"—any approval, consent, ratification, waiver, or other authorization (including any Governmental Authorization).

"Contemplated Transactions"—all of the transactions contemplated by this Agreement, including:

        (a)  the sale of the Shares by Seller to Buyer;

        (b)  the performance by Buyer and Seller of their respective covenants and obligations under this Agreement; and

        (c)  Buyer's acquisition and ownership of the Shares and exercise of control over the Company.

"Contract"—any agreement, contract, obligation, promise, or undertaking (whether written or oral and whether express or implied) that is legally binding.

"Damages"—as defined in Section 12.2.

"Disclosure Schedule"—the Disclosure Schedule delivered by Seller to Buyer concurrently with the execution and delivery of this Agreement.

"Draft Adjustment Amount"—as defined in Section 2.6.

"Encumbrance"—any charge, claim, condition, lien, option, pledge, security interest, right of first refusal, or restriction of any kind, including any restriction on use, transfer, receipt of income, or exercise of any other attribute of ownership.

"Environmental Claim"—shall mean any and all administrative, regulatory or judicial actions, suits, proceedings, executory decrees, judgments, demands, demand letters, orders, directives, claims (including claims involving liability in tort), liens or notices of noncompliance or violation relating to any Environmental Law or permit issued under any such Environmental Law, or arising from the presence or release into the environment of Hazardous Materials including, without limitation, Environmental Claims by any governmental or regulatory authority or by any third party for enforcement, cleanup, removal, response, remedial or other actions or damages, contribution, indemnification, cost recovery, compensation or injunctive relief pursuant to any Environmental Law.

"Environmental Laws"—shall mean all federal, Commonwealth, state, and local laws, statutes, ordinances, rules now or hereafter in effect, and in each case as amended, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment relating to the regulation and protection of human health, safety, the environment and natural resources, without limitation, laws and regulations relating to emissions, discharges, releases or threatened releases of Hazardous Materials or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials. Environmental Laws include but are not limited to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended ("CERCLA"); the Federal Insecticide, Fungicide, and Rodenticide Act, as amended ("FIFRA"); the Resource Conservation and Recovery Act, as amended ("RCRA"); the Toxic Substances Control Act, as amended ("TSCA"); the Clean Air Act, as amended ("CAA); the Federal Water Pollution Control Act, as amended ("FWPCA"); the Oil Pollution Act of 1990, as amended ("OPA"); the Fish and Wildlife Coordination Act, as amended ("FWCA"); the Endangered Species Act, as amended ("ESA"); the Wild & Scenic Rivers Act, as amended ("WSRA"); the Rivers and Harbors Act of 1899, as amended ("1899 Rivers Act"); the Water Resources Research Act of 1984, as amended ("WRRA"); the Occupational Safety and Health Act, as amended ("OSHA"); and the Safe Drinking Water Act, as amended ("SDWA"); and their state and local counterparts or equivalents.

"ERISA"—means the Employee Retirement Income Security Act of 1974, as amended.

"Estimated Adjustment Amount"—as defined in Section 2.6.

2

"Facilities"—any real property, leaseholds, or other interests currently owned or operated by the Company and any buildings, plants, structures, or equipment currently owned or operated by the Company.

"Financial Statements"—the financial statements indicated in Section 3.9, including notes thereto, as applicable.

"FCC"—shall mean the Federal Communications Commission.

"FCC Consent"—the action by the FCC granting consent to the purchase of the Shares by the Buyer and the transfer to the Buyer of control of the Company as contemplated in this Agreement

"GAAP"—generally accepted United States accounting principles.

"Governmental Authorization"—any approval, consent, license, permit, waiver, or other authorization issued, granted, given, or otherwise made available by or under the authority of any Governmental Body or pursuant to any Legal Requirement.

"Governmental Body"—any:

        (a)  nation, Commonwealth, state, county, city, municipality, town, village, district, or other jurisdiction of any nature;

        (b)  federal, state, Commonwealth, local, municipal, foreign, or other government;

        (c)  governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal);

        (d)  multi-national organization or body; or

        (e)  body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature.

"Hazardous Materials"—shall mean, collectively, (a) flammable explosives, radioactive materials, friable asbestos, urea formaldehyde foam insulation, transformers or other equipment that contain dielectric fluid containing levels of polychlorinated biphenyls, and radon gas, and (b) chemicals, materials, substances or wastes which are now or hereafter become defined as or included in the definition of "hazardous substances", "hazardous waste", "hazardous materials", "extremely hazardous wastes", "restricted hazardous wastes", "toxic substances", "toxic pollutants", or words of similar import, under any applicable Environmental Law.

"Indemnified Persons"—as defined in Section 12.2

"Intellectual Property"—shall mean the following:

        (a)  the Company's name, all trade names;

        (b)  registered and unregistered trademarks, service marks, and applications;

        (c)  patents, patent applications; and

        (d)  know-how, trade secrets, confidential information, customer lists, software, technical information, data, process technology, plans, drawings, and blue prints.

"Internal Revenue Code"—means the Puerto Rico Internal Revenue Code of 1994, as amended.

"Knowledge"—an individual will be deemed to have "Knowledge" of a particular fact or other matter if:

        (a)  such individual is actually aware of such fact or other matter; or

3

        (b)  a prudent individual could be expected to discover or otherwise become aware of such fact or other matter in the course of conducting a reasonable investigation concerning the existence of such fact or other matter.

        Furthermore, Knowledge of Seller or the Company, shall refer only to the knowledge of the following individuals:

Argentina S. Hills	Huberto Biaggi
Rafael Cortés Dapena	Gabriel Laffitte
Grafton Olivera

"Legal Requirement"—any federal, state, Commonwealth, local, municipal, foreign, international, multinational, or other administrative order, constitution, law, ordinance, principle of common law, regulation, statute, or treaty.

"Most Recent Financial Statements"—as defined in Section 3.9.

"Net Working Capital"—shall mean the current assets less the current liabilities of the Company (including all of the Company's transaction costs associated with the Contemplated Transactions, accrued volume discounts, and all other accruals including applicable Taxes), as determined under GAAP.

"Order"—any award, decision, injunction, judgment, order, ruling, subpoena, or verdict entered, issued, made, or rendered by any court, administrative agency, or other Governmental Body or by any arbitrator.

"Ordinary Course of Business"—an action taken by a Person will be deemed to have been taken in the "Ordinary Course of Business" only if:

        (a)  such action is consistent with the past practices of such Person and is taken in the ordinary course of the normal day-to-day operations of such Person; and

        (b)  such action is not required to be authorized by the board of directors of such Person;

"Organizational Documents"—the articles of incorporation and the bylaws of the Seller or the Company.

"Person"—any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union, or other entity or Governmental Body.

"Proceeding"—any action, arbitration, audit, hearing, investigation, litigation, or suit (whether civil, criminal, administrative, investigative, or informal) commenced, brought, conducted, or heard by or before, or otherwise involving, any Governmental Body or arbitrator.

"Purchase Price"—as defined in Section 2.2.

"Representative"—with respect to a particular Person, any director, officer, employee, agent, consultant, advisor, or other representative of such Person, including legal counsel, accountants, and financial advisors.

"Seller"—as defined in the first paragraph of this Agreement.

"Shares"—as defined in the Recitals of this Agreement.

"Tax"—Any tax (including any income tax, capital gains tax, value-added tax, sales tax, property tax, gift tax, or state tax), levy, assessment, tariff, duty (including any custom duty), deficiency, or other fee, and any related charge or amount (including any fine, penalty, interest, or addition to tax), imposed assessed or collected by or under the authority of any Governmental Body or payable

4

pursuant to any tax-sharing agreement or any other Contract relating to the sharing or payment of any such tax, levy, assessment, tariff, duty, deficiency, or fee.

"Tax Return"—any return (including any information return), report, statement, schedule, notice, form, or other document or information filed with or submitted to, or required to be filed with or submitted to, any Governmental Body in connection with the determination, assessment, collection, or payment of any Tax or in connection with the administration, implementation, or enforcement of or compliance with any Legal Requirement relating to any Tax.

"Threatened"—a claim, Proceeding, dispute, action, or other matter will be deemed to have been "Threatened" if any demand or statement has been made (orally or in writing) or any notice has been given (orally or in writing), or if any other event has occurred or any other circumstances exist, that would lead a prudent Person to conclude that such a claim, Proceeding, dispute, action, or other matter is likely to be asserted, commenced, taken, or otherwise pursued in the future.

"Treasury"—the Department of the Treasury of the Commonwealth of Puerto Rico

2.

SALE AND TRANSFER OF SHARES; CLOSING

        2.1Shares.    Subject to the terms and conditions of this Agreement, at the Closing, Seller will sell and transfer the Shares to Buyer, and Buyer will purchase the Shares from Seller.

        2.2Purchase Price.    The purchase price (the "Purchase Price") for the Shares will be $32,000,000 (the "Base Purchase Price"), increased or decreased by the Adjustment Amount, as defined herein.

        2.3Closing.    The purchase and sale (the "Closing") provided for in this Agreement will take place at the offices of Buyer's counsel at 10:00 a.m. (local time) on the 10^th day after all conditions precedent to the Closing have been satisfied or waived, or at such other time as the parties may agree.

        2.4Closing Obligations.    At the Closing:

        (a)  Seller will deliver to Buyer:

          (i)  certificates representing the Shares, duly endorsed (or accompanied by duly executed stock powers), for transfer to Buyer;

        (ii)  a certificate executed by Seller representing and warranting to Buyer that each of Seller's representations and warranties in this Agreement was accurate in all material respects as of the date of this Agreement and is accurate in all material respects as of the Closing Date as if made on the Closing Date (giving full effect to any supplements to the Disclosure Schedule that were delivered by Seller to Buyer prior to the Closing Date in accordance with Section 9.4); and

        (b)  Buyer will deliver to Seller:

          (i)  the Base Purchase Price by wire transfer to accounts specified by Seller (provided, however, that pursuant to the terms of the Post-Closing Indemnity Escrow Agreement in the form attached hereto as Part 2.5(b) of the Disclosure Schedule (the "Escrow Agreement"), the parties shall set aside from the Base Purchase Price and deposit with the Escrow Agent identified in the Escrow Agreement the sum of $1,600,000, and all interest on such escrowed amount shall be paid quarterly to Seller); and

        (ii)  a certificate executed by Buyer to the effect that, each of Buyer's representations and warranties in this Agreement was accurate in all material respects as of the date of this Agreement and is accurate in all material respects as of the Closing Date as if made on the Closing Date.

        2.5Adjustment Amount.    The Adjustment Amount (which may be a positive or negative number) shall be, as of the Closing Date, an amount equal to Net Working Capital less the sum of (i) $2.0 million, (ii) the amount, if any, owed to Banco Popular de Puerto Rico under a certain Credit

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Agreement dated September 16, 1997, as amended, and (iii) any other indebtedness of the Company which is not included as part of the calculation of Net Working Capital.

        2.6Adjustment Procedure.

        (a)  On the date that is no more than three business days prior to the Closing, the Seller shall deliver to the Buyer an estimated balance sheet of the Company as of the Closing Date (the "Estimated Closing Balance Sheet"), which shall be prepared using consistent accounting principles as with prior periods, taking into account cash reserves for the payment of all volume discounts accrued by the Company and not previously settled or paid.

        (b)  Within 30 days after the Closing Date, Deloitte & Touche ("Deloitte") shall prepare in accordance with GAAP and consistent with the preparation of the Financial Statements, and deliver to the Buyer and Seller a closing balance sheet for the Company, as of the Closing Date (the "Draft Closing Balance Sheet"). Within no later than 10 days (or as otherwise agreed to by Buyer and Seller) after the delivery of the Draft Closing Balance Sheet, Buyer and Seller shall meet in the offices of Deloitte, located at San Juan, Puerto Rico, to object to any provisions of the Draft Closing Balance Sheet, which objections shall be resolved in the sole discretion of Deloitte. Once all objections, if any, have been resolved by Deloitte, the Draft Closing Balance Sheet shall become the "Closing Balance Sheet" and Deloitte shall calculate the Adjustment Amount. Within five days following the date that the Closing Balance Sheet is determined, (i) if the Adjustment Amount is a positive number, the Buyer shall pay Seller in cash an amount equal to the Adjustment Amount; or (ii) if the Adjustment Amount is a negative number, the Seller shall pay to buyer in cash an amount equal the Adjustment Amount multiplied by negative one.

        (c)  On February 1, 2004 (or at such other time as agreed to by the Buyer and Seller), Buyer and Seller shall in good faith update the Closing Balance Sheet based upon the Company's actual operating results (including actual accrued and paid volume discounts), and at such time Buyer and Seller shall recalculate the Adjustment Amount determined in Section 2.6(b) (after adjustment, the "Final Adjustment Amount"). Any disagreements between Buyer and Seller regarding the update of the Closing Balance Sheet and the calculation of the Final Adjustment Amount shall be settled by Deloitte, whose determination shall be final. Then, within 5 days after determining the Final Adjustment Amount (i) if the Final Adjustment Amount is greater than the Adjustment Amount determined pursuant to Section 2.6(b) (negative 1 is "greater" than negative 5), Buyer shall pay to Seller, in cash, an amount equal to the difference of the Final Adjustment Amount and the Adjustment Amount determined in Section 2.6(b) plus 6% simple, annual interest on such amount calculated from the Closing Date; or (ii) if the Final Adjustment Amount is less than the Adjustment Amount (negative 5 is "less" than negative 1), Seller shall pay to Buyer, in cash, an amount equal to the difference of the Final Adjustment Amount and the Adjustment Amount determined in Section 2.6(b) plus 6% simple, annual interest on such amount calculated from the Closing Date.

3.

REPRESENTATIONS AND WARRANTIES OF SELLER

        Seller represents and warrants to Buyer as follows:

        3.1Organizational and Good Standing of Seller.    Seller is a not-for-profit corporation duly organized, validly existing and in good standing under the laws of Puerto Rico, with full corporate power and authority to conduct its corporate affairs as now being conducted.

        3.2Title of Shares.    Seller is the lawful owner of the Shares, as trustee, under a certain Trust (the "Trust") created pursuant to Clause Tenth of the Last Will and Testament of Angel Ramos (Deed No. 2 executed on May 22, 1959, before Notary Public Milton Francisco Rua) and subject to the approval by the Board of Directors of the Seller, has the right, power and authority (without further authorization or approval) to sell, assign, convey, transfer and deliver the same to the Buyer pursuant to this Agreement, free and clear of all Encumbrances. Upon delivery at closing of certificates

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representing the Shares, the Buyer shall have good and marketable title to and own such Shares, free and clear of all Encumbrances, and such Shares will be fully paid and nonassessable.

        3.3Authorization; Execution and Delivery; Binding Obligation.    Except for the approval by the Board of Directors of the Seller, all corporate acts and other proceedings required to be taken by or with respect to the Seller, both in its capacity as a corporation and as trustee under the Trust, to authorize it to execute, deliver and perform this Agreement and the Contemplated Transactions have been duly taken. Subject to the approval by the Board of Directors, this Agreement has been duly executed and delivered by the Seller. When approved by the Board of Directors of Seller, this Agreement will constitute the legal, valid and binding obligation of the Seller in accordance with its terms.

        3.4Violation of Law; Consents.    The execution, delivery and performance by Seller of this Agreement, and the consummation of the Contemplated Transactions will not violate any Legal Requirements applicable to the Seller or the Company or any of the Organizational Documents of the Seller or the Company. Except as indicated in Part 3.4 of the Disclosure Schedule, no Consent, other action of, or filing with, any Person, or any court, administrative agency or any Governmental Authority is required in connection with the execution and delivery by the Seller of this Agreement, and the consummation of the Contemplated Transactions.

        3.5Organization, Corporate Power and Good Standing of the Company.    The Company is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of Puerto Rico and has the corporate power and authority to carry on its business as now conducted and to own or lease its properties and other assets as now owned or leased. The Company has not qualified to do business in any jurisdiction other than the Commonwealth of Puerto Rico and no such qualification is necessary in order to enable the Company to carry on its business as now conducted or to own or lease its properties and assets as now owned or leased.

        3.6Capitalization.    The authorized capital stock of the Company consists of 20,000 shares of Common Stock, of which 10,000 shares are issued and outstanding. All shares of capital stock of the Company represented by issued stock certificated are validly issued, fully paid and nonassessable, are registered in the name of, and owned of record by the Seller, and the Seller is the sole Person entitled to receipt of all, or any portion of the Purchase Price. The Shares constitute 100% of the outstanding equity interests in the Company. There are not any outstanding Contracts, warrants, options, calls, pre-emptive or other rights, or other commitments of any nature relating to any of the authorized shares of capital stock of the Company.

        3.7Subsidiaries and Investments.    The Company has no subsidiaries nor does it own any interest in any corporation, business trust, firm, partnership, joint venture, entity or organization.

        3.8Certificate of Incorporation and By-Laws, etc.    The copies of the present Certificate of Incorporation of the Company, and the present By-Laws of the Company which have been delivered to the Buyer, are true, complete and correct. The minute books, stock certificate books and stock transfer books of the Company are true, complete and correct.

        3.9Financial Statements.    The interim financial statements of the Company as of December 31, 2002 (unaudited) (the "Most Recent Financial Statements"), and the certified financial statements (audited by Deloitte) as of August 31, 2002, 2001, and 2000, heretofore furnished by the Seller to the Buyer, present fairly the financial condition and results of the operations of the Company as at the respective dates of said balance sheets and for the periods indicated in said statements of income, and the certified financial statements have been prepared in conformity with GAAP applied on a consistent basis throughout the periods involved. The Company does not have, or as of the Closing Date shall not have, (i) any long-term liabilities (with a term greater than one year), or (ii) any other liabilities (not long-term liabilities) except (1) those liabilities set forth on the Most Recent Financial Statements and

7

not heretofore paid or discharged, and (2) those of the same nature as those set forth on the Most Recent Financial Statements and reasonably incurred in the ordinary course of business, consistent with past practice, after December 31, 2002.

        3.10Receivables.    All receivables of the Company included in the Closing Date Adjustment Amount shall be collectible in full when due in the ordinary course of business in amounts equal to not less than the aggregate face amounts thereof, after giving effect to any applicable provision for doubtful and uncollectible accounts included as part of the Closing Date Adjustment Amount.

        3.11Taxes.

        (a)  The Company has filed or caused to be filed (on a timely basis) all Tax Returns that are or were required to be filed pursuant to applicable Legal Requirements, including its 2002 income tax return. The Company has paid, or made proper accruals for the payment of, all Taxes that have or may have become due pursuant to those Tax Returns or otherwise, or pursuant to any assessment received by the Company.

        (b)  The charges, accruals, and reserves with respect to Taxes on the books of the Company as of the Closing Date will be at least equal to the Company's liability for such Taxes. There exists no proposed tax assessment against the Company. All Taxes that the Company is or was required by Legal Requirements to withhold or collect have been duly withheld or collected and, to the extent required, have been paid to the proper Governmental Body or other Person.

        (c)  All Tax Returns filed by the Company are true, correct, and complete.

        (d)  The Company is not, and never has been, liable for any Tax payable by reason of the income or property of a Person other than the Company. No litigation with respect to any Tax for which the Company is asserted to be liable is pending and no basis which Seller believes to be valid exists on which any claim for any such Tax can be asserted against the Company. There are no requests for rulings or determinations in respect of any Taxes pending between the Company and any taxing authority. No issues have been raised and remain pending by any taxing authority in connection with the examination of any Tax Return of the Company. No extension of any period during which any Tax may be assessed or collected and for which the Company is or may be liable has been granted to any taxing authority. The Company is not and never has been party to any tax allocation or sharing agreement. The Company has made all deposits required by law to be made with respect to employees' withholding and other employment Taxes. The Company has not made, is not obligated to make and is not a party to any agreement that could require it to make any payment that is not deductible under Section 280G of Internal Revenue Code of 1986, as amended from time to time (the "US Code"), or such comparable provision under the Internal Revenue Code. No asset of the Company is subject to any provision of applicable law which eliminates or reduces the allowance for depreciation or amortization in respect of that asset below the allowance generally available to an asset of its type. No accounting method changes of the Company exist or are proposed or threatened which could give rise to an adjustment under Section 481 of the US Code, or such comparable provision under the Internal Revenue Code.

        3.12Real Property.Part 3.12 to the Disclosure Schedule describes all real property owned by the Company (including the land for the tower sites for the Stations used in Cataño and Ponce) (the "Owned Real Property"), and a complete list and brief description of all real property leased to the Company (the "Leased Real Property" and, together with the Owned Real Property, the "Real Property").

        (a)  The Company has, or will have before Closing, good and marketable title in fee simple to all of the Owned Real Property, free and clear of all Encumbrances, except those indicated in Part 3.12 of the Disclosure Schedule. The Encumbrances set forth on Part 3.12 of the Disclosure Schedule do not

8

hinder, impede, or diminish in any way the current use of the Owned Real Property or the operations conduced thereon.

        (b)  The Company enjoys quiet possession of each of the premises purported to be leased to it, under valid leases with respect thereto, enforceable in accordance with their respective terms. Seller has furnished to Buyer a complete and correct copy of the leases in respect of all of the Leased Real Property. Neither the Company nor, to the Knowledge of Seller, the other party thereto is in default in respect of such leases.

        (c)  None of the Real Property is subject to, and neither the Company nor Seller has received notice of, any pending or proposed reassessment, contest, protest, or other proceedings with respect to real property taxes. Neither the Company nor Seller has taken any action to have real estate taxes that will be assessed against the Real Property adjusted or modified in any respect. There is no, and neither the Company nor Seller has received notice of any, pending or proposed special assessment that affects, or may affect, the Real Property or any portion thereof.

        (d)  The current uses of and existing structures located on the Real Property are in all material respects in compliance with all applicable zoning, construction, and other land use requirements. No Legal Requirements prohibit or materially interfere with the current use of any of the Real Property. The Company, to the extent required by any Legal Requirements, is in possession of, or will be prior to Closing, all use permits with respect to all of the Real Property issued by the appropriate Governmental authority. Valid use permits for all Real Property which permit the current uses of the Real Property exist, or will exist prior to Closing, and continue in full force and effect through the Closing Date. Seller shall be solely responsible for procuring such Permits and certificates.

        (e)  The improvements located on the Real Property are in good condition and are structurally sound, and all mechanical and other systems located therein are in an operating condition good for the use to which same are put by the Company in the current operation of the Company's business, subject to normal wear and tear. No condition exists requiring material repairs, alterations or corrections, and no maintenance or repair to the improvements or the mechanical or other systems located therein have been unreasonably deferred.

        3.13Licenses and Authorizations.    Except as otherwise disclosed therein, Part 3.13 to the Disclosure Schedule consists of a complete list and brief description of all Governmental Authorizations held by the Company or pending applications as of the date hereof, including, without limitation, any of the foregoing granted by, or pending with, the FCC, held in connection with the ownership and operation of radio stations WKAQ-AM, WKAQ-FM, WUKQ-FM and WUKQ-AM (collectively, the "Stations"). The Governmental Authorizations listed in such Part 3.13 of the Disclosure Schedule are the only Governmental Authorizations necessary to, or used in, the business of the Company as now conducted (including, without limitation the operation of the Stations) and the same are in good standing and in full force and effect. The Company is not the subject of any notice of violation or order, or any complaint, issued by or filed with the FCC in connection with the operation of, or authorizations for, the Stations. To Seller's Knowledge, the Stations and the facilities of the Stations are being operated in all material respects in accordance with the FCC Licenses and all material FCC rules and policies. To Seller's Knowledge, the Stations' transmission towers and equipment have been operated and maintained by the Company in material compliance with the Communications Act and the rules and regulations of the FCC and the Federal Aviation Administration ("FAA"), and the towers have been properly registered with the FCC and approved by the FAA as necessary. Notwithstanding the foregoing, Seller shall, at its own cost and expense, obtain all Governmental Authorization for the operation of the Company's business and facilities prior to Closing.

        3.14Equipment and Personal Property.Part 3.14 of the Disclosure Statement consists of a complete list of all equipment and other personal property owned by the Company with an original acquisition cost in excess of $50,000. All the personal property owned by the Company, including other items listed

9

in Part 3.14 of the Disclosure Schedule, are free and clear of Encumbrances. The personal property assets owned by the Company and used in the conduct of its business and necessary for the conduct of the business as now conducted are in satisfactory operating condition and repair to permit the conduct of such business.

        3.15Intellectual Property.

        (a)  Title. Part 3.15 of the Disclosure Schedule contains a complete and correct list of all the Intellectual Property owned by the Company. The Intellectual Property set forth on Part 3.15 of the Disclosure Schedule comprises all of the Intellectual Property used by the Company to conduct and operate its business as now being conducted. Except as set forth on Part 3.15 of the Disclosure Schedule, there are no agreements restricting the Company's use of the Intellectual Property or requiring the payment to any third party for the use thereof. Other than as set forth on Part 3.15 of the Disclosure Schedule, the Company owns, or has the exclusive rights to the of use and control of, both without restriction or Encumbrance of any kind, the Stations' call letters, including WKAQ-AM, WKAQ-FM, WUKQ-FM and WUKQ-AM, and the Intellectual Property set forth on Part 3.15 of the Disclosure Schedule, other than the first 8 items listed under Pending Applications, and has not transferred, granted or otherwise assigned any portion of such rights to any other Person

        (b)  Due Registration. Part 3.15 of the Disclosure Schedule lists the Intellectual Property which has been duly registered with the United States Patent and Trademark Office or the Puerto Rico Department of State. Except as otherwise set forth in Part 3.15 of the Disclosure Schedule, such registrations remain in full force and effect.

        (c)  No Intellectual Property Litigation. Except as set forth in Part 3.15 of the Disclosure Schedule, no claim or demand has been made to Seller nor is there any proceeding that is pending, or to Seller's Knowledge, Threatened, which (i) challenges the rights of Seller with respect of any Intellectual Property, (ii) asserts that Seller is infringing or otherwise in conflict with any Intellectual Property.

        3.16Insurance.Part 3.16 of the Disclosure Schedule consists of a complete list and brief description of all policies of fire, liability, workers' compensation, life, title policy, and other forms of insurance held by the Company or otherwise benefiting the Company or its employees. All premiums and other payments due from the Company under or on account of any such policy have been paid in a timely manner. Seller shall use its Best Efforts to ensure that, on or prior to Closing, all policies listed on Part 3.16 of the Disclosure Schedule will be held in the name of the Company unless otherwise agreed to by Buyer. Buyer shall in good faith assist buyer in obtaining the issuance of such policies in the name of the Company.

        3.17Contracts.

        (a)  Except as set forth in Part 3.17(a) of the Disclosure Schedule the Company is not as of the date hereof, and will not be directly or indirectly, on the Closing Date, a party to or bound by any:

          (i)  Contract with any Person providing professional services compensation exceeding $50,000 in any fiscal year;

        (ii)  Contract with any labor union or other association representing employees;

        (iii)  Contract for the future purchase of materials, supplies, services or equipment in excess of reasonable requirements for the operation of its business consistent with its operating history;

        (iv)  Contract continuing over a period of more than one year from its date;

        (v)  Contract for material capital expenditures other than Contracts for capital expenditures and commitments for capital expenditures which in the aggregate exceed a monthly average of $5,000 from the date hereof;

10

        (vi)  Contract with Seller or any affiliate or any Seller;

      (vii)  indenture, mortgage, note, loan or credit agreement, or other contract or obligation relating to the borrowing of money by the Company or to the direct or indirect guarantee or assumption by the Company of any obligation of others, including any arrangement which has the economic effect of a guarantee;

      (viii)  license or royalty agreement without limitation, program licenses;

        (ix)  Contract under which it is lessor or lessee;

        (x)  Contract with any government or any agency or instrumentality thereof other than any such Contract relating to the purchase thereby of advertising time at no less than regular rates charged to government agencies;

        (xi)  Contract granting to any person any preferential right to purchase any assets or properties;

      (xii)  Contract in the nature of a bonus, deferred compensation, pension, profit sharing, retirement, stock purchase, stock option, hospitalization, insurance, vacation, severance or similar plan or practice, formal or informal, with respect to its officers, employees or others;

      (xiii)  Contract in the nature of a network affiliation agreement;

      (xiv)  Contract which is material and not made in the ordinary course of business and not disclosed pursuant to any other subdivision of this Section;

        (b)  Other than as set forth in Part 3.17(b) of the Disclosure Schedule, neither the execution and delivery of this Agreement nor the consummation by the Company and the Seller of the Contemplated Transactions, will violate, breach, be in conflict with, or constitute a default under, or permit the termination or the acceleration of maturity of any Contract to which the Company or the Seller is a party.

        (c)  The Company has complied, in all material respects, with all commitments and obligations pertaining to it, and is not in default under any contracts or agreements listed on Part 3.17 of the Disclosure Schedule and except for item 14 of Part 3.18 of the Disclosure Schedule no notice of default under any such contract or agreement has been received. Notwithstanding the representation made in this Section 3.17(c), any costs incurred by the Company resulting from noncompliance of the Contracts disclosed on Part 3.17 of the Disclosure Schedule shall be characterized as Damages under Section 12.2.

        3.18Legal Proceedings.    Except as set forth and described in Part 3.18 of the Disclosure Schedule, there are no actions, suits, Proceedings or investigations pending, or to the Knowledge of Seller Threatened, against or affecting the Company, at law or in equity, before any Federal, state, Puerto Rico, county, municipal, foreign or other governmental department, commission, board, bureau, agency or instrumentality or before any arbitrator or any kind, in each case domestic or foreign. The Company is not in default with respect to any Order, writ, injunction or decree of any court or any Federal, state, Puerto Rico, county, municipal or other governmental department, commission, board, bureau, agency or instrumentality, or arbitrator of any kind, in each case domestic or foreign.

        3.19Compliance with Laws.    The Company is not in violation of any Legal Requirement, applicable to its business, properties or assets in a manner which might result in any material adverse effect in the business, operations, properties, assets or financial condition of the Company.

        3.20Employee and Labor Relations.

        (a)  Part 3.20 of the Disclosure Schedule contains a correct and complete list of (i) names, positions and date of hire of each of the employees of the Company; (ii) the annual salary or hourly wage of each such person; and (iii) any Contract that provides for employment of any individual as an

11

employee or independent contractor of the Company. The Company has not accrued, is not obligated to pay, and has not agreed to pay any deferred compensation to its employees or contract labor.

        (b)  There are no unfair labor practice charges pending against the Company. The Company is not or during the past three years has not been, the subject of any strike, work stoppage, picketing or work slowdown, or other similar labor dispute, controversy, or proceeding, and to the Knowledge of the Seller or the Company no such activity is Threatened. Seller has complied in all material respects with all laws relating to the employment and safety of labor, including provisions relating to wages, hours, benefits, collective bargaining, discrimination, the payment of social security and other payroll expenses, and all applicable occupational safety and health acts, laws, and regulations.

        (c)  Except as set forth on Part 3.20 of the Disclosure Schedule, (i) the Company is not a party to or subject to any collective bargaining agreements with respect to the Stations; and (ii) there is no representation or organizing effort pending or threatened against or involving or affecting the Company with respect to employees employed at the Stations.

        3.21Employee Benefit Plans.

        (a)  All Benefit Plans of the Company are listed in Part 3.21 of the Disclosure Schedule and Seller has furnished complete and accurate copies of all such benefit plans. All Benefit Plans have been administered in compliance with all their material terms and conditions and in material compliance with the provisions of ERISA, the Internal Revenue Code, and any other Legal Requirements. All contributions that were required to be made by the Company under such Benefit Plans have been made as of the Closing Date and the Company has performed all material obligations required to be performed as of the Closing Date under all Benefit Plans.

        (b)  Except as indicated in Part 3.21 of the Disclosure Schedule, the Company (i) is not contributing to, or is not required to contribute to, or has not contributed within the last four years to, any Benefit Plan, multi employer plan, as defined in ERISA Section 3(37), single employer plan, as defined in ERISA Section 4063(a), or employee pension benefit plan, as defined under ERISA Section 3(2), that was subject to Title IV of ERISA; (ii) has not been held liable within the last four years, nor reasonably expects to be liable for any "withdrawal liability", as defined under ERISA Section 4201 et seq., and, (iii) has not engaged in a transaction to evade liability, as described under ERISA Section 4069.

        (c)  Except as set forth in Part 3.21 of the Disclosure Schedule, there are no other Benefit Plans covering Employees of the Company; whether formal or informal, accrued or unaccrued, contingent or otherwise, sponsored or maintained by the Company. The Company has not scheduled or agreed upon future increases of benefits levels (or creations of new benefits) with respect to any Benefit Plan The Company has made no commitments, nor agreed to create any additional Benefit Plans or to modify or change in any material respect any existing Benefit Plans, except as required by any Legal Requirement.

        (d)  Neither the Seller nor the Company is aware of the existence of an governmental, investigation, audit, or examination of any Benefit Plan or of any facts that would lead it to believe that any such governmental investigation, audit, or examination is pending or Threatened. There exists no action, suit, or claim with respect to any Benefit Plan pending or, to the Knowledge of Seller or the Company, Threatened against any such plan or arrangement.

        3.22Changes After December 31, 2002.    Except as set forth in Part 3.22 of the Disclosure Schedule, since December 31, 2002, the Company has not:

        (a)  issued or sold, or issued any option or right to subscribe to, or entered into any Contract to issue or sell, any shares of its capital stock or any bonds or other corporate securities or subdivided or in any way reclassified any shares of its capital stock;

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        (b)  incurred any obligation or liability (absolute or contingent) except current liabilities incurred, and obligations under Contracts entered into, in the Ordinary Course of Business;

        (c)  discharged or satisfied any material claim or paid any obligation or liability (absolute or contingent) other than current liabilities shown on the Most Recent Financial Statements and current liabilities incurred since the date thereof in the Ordinary Course of Business;

        (d)  purchased or redeemed any shares of its capital stock;

        (e)  mortgaged, pledged or subjected to any claim, any of its assets, tangible or intangible;

        (f)    canceled any debt or claim, except in each case in the Ordinary Course of Business;

        (g)  made any material addition to, or sold any material portion of, its fixed assets;

        (h)  sold, assigned or transferred any Intellectual Property.

        (i)    increased, directly or indirectly, the salary or other compensation of any officer of the Company or of any member of its management, or entered into any employment agreement with any person or paid or entered into any agreement to pay any bonus or other extraordinary compensation to any officer of the Company or to any member of its management or other employees, or instituted any general increase in rates of compensation of its employees, or increased, directly or indirectly, any pension of benefits for any thereof;

        (j)    made any material capital expenditure or commitment therefor, except made pursuant to a Contract in accordance with Section 3.17;

        (k)  suffered any casualty or other similar loss of assets;

        (l)    entered into any Contract with Seller or any affiliate of the Seller;

        (m)  amended its Certificate of Incorporation or By-laws or merged with or into or consolidated with any other corporation, or changed or agreed to change in any manner the rights of its outstanding capital stock or the character of its principal business;

        (n)  by any act or omission to act defaulted under any lease or license or material Contract; or

        (o)  entered into any other material transaction other than in the Ordinary Course of Business.

        3.23Environmental Matters.    Except as set forth in Part 3.23 of the Disclosure Schedule, to the Knowledge of Seller:

        (a)  the Company complied and is now complying with the material requirements of relevant Environmental Laws and permits, licenses or authorizations issued under such Environmental Laws with respect to the Facilities;

        (b)  there are no past or present circumstances, activities, events, conditions or occurrences that will (a) form the basis of an Environmental Claim against the Company with respect to the Facilities; (b) cause the Facilities to be subject to material restrictions on its ownership, occupancy, use or transferability under any Environmental Law; (c) require the filing or recording of any material notice or restriction relating to the presence of Hazardous Materials in the Facilities; or (d) materially prevent or interfere with Buyer's ability to operate and maintain the Facilities in substantial compliance with applicable Environmental Laws;

        (c)  the permits, authorizations and licenses required under Environmental Laws to operate and maintain the Facilities have been obtained;

        (d)  there are no pending Environmental Claims against the Facilities or Seller with respect to the Facilities that would have a material adverse effect on the Facilities or Seller with respect to the Facilities;

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        (e)  Hazardous Materials have not at any time been generated, used, treated, recycled or stored on, or transported to or from, or released, deposited or disposed of on the Facilities, and the Company has not used the Facilities for such purposes other than in substantial compliance with applicable Environmental Laws; and

        (f)    there are no in-use underground storage tanks at the Facilities; there is no asbestos contained in, forming part of, or contaminating any part of the Facilities; and no polychlorinated biphenyls (PCBs) are used at the Facilities.

        3.24No Material Adverse Change.    Since the date of the Most Recent Financial Statements, there has not been any material adverse change of the business, operations, properties or assets of the Company.

        3.25Brokers or Finders.    Seller has retained Kalil & Co., Inc. as Seller's broker in connection with the transactions contemplated by this Agreement and either (i) will be fully liable for such broker's fees or commissions or (ii) will cause the Company to pay in full such liability as of the Closing and set forth such liability in the computation of Net Working Capital.

        3.26No Additional Representations.    Buyer acknowledges that Seller and/or the Company have made no representation or warranty, expressed or implied, except as expressly set forth in this Agreement. Seller represents and warrants that any information regarding the Company which was delivered in writing or made available for inspection by Buyer does not contain any material misstatement.

        3.27Representations and Warranties on Closing Date.    The representations and warranties made in this Section 3 will be true and correct on and as of the Closing Date with the same force and effect as though such representations and warranties had been made on and as of the Closing Date, except that any such representations and warranties which expressly relate to an earlier period shall be true and correct on the Closing Date as of such earlier date.

        3.28Payola/Pugola.    To the Knowledge of Seller, (i) no direct or indirect payment has been made to any employee or executive of the Company or its affiliates to influence airplay on the Stations without informing the Stations' listeners and (ii) there has been no investigation, inquiry, disciplinary action or fine (whether governmental or otherwise) regarding any payments relating to airplay on the Stations.

        3.29Music Licenses.    The Company and the Stations have made all required payments of license fees under, and have properly accrued all liabilities in respect of, obligations to ASCAP and BMI.

4.

REPRESENTATIONS AND WARRANTIES OF THE BUYER

        The Buyer represents and warrants to the Seller as follows:

        4.1Organization, Corporate Power and Good Standing of the Buyer.    The Buyer is a corporation duly organized, validly existing and in good standing under the laws of Delaware and has the corporate power and authority to carry on its business, as now conducted and to own or lease its properties and other assets as now owned or leased. The Company has qualified to do business in any other jurisdiction in which such qualification is necessary in order to enable the Company to carry on its business as now conducted or to own or lease its properties and assets as now owned or leased.

        4.2Authorization; Execution and Delivery; Binding Obligation.    All corporate acts and other proceedings required to be taken by or with respect to the Buyer to authorize it to execute, deliver and perform this Agreement and the Contemplated Transactions have been duly taken. This Agreement has been duly executed and delivered by the Buyer and constitutes the legal, valid and binding obligation of the Buyer in accordance with its terms.

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        4.3Violation of Law; Consents.    The execution, delivery and performance by Buyer of this Agreement, and the consummation of the Contemplated Transactions will not violate any Legal Requirements applicable to the Buyer or any of the Organizational Documents of the Buyer. Except as indicated in Part 4.3 of the Disclosure Schedule, no Consent, other action of, or filing with, any Person, or any court, administrative agency or any Governmental Authority is required in connection with the execution and delivery of the Buyer of this Agreement and the consummation of the Contemplated Transactions.

        4.4Brokers or Finders.        Buyer has incurred no obligation or liability, contingent or otherwise, for brokerage or finders' fees or agents' commissions or other similar payment in connection with this Agreement.

        4.5FCC Qualifications.    There are no facts that under the Communications Act or the rules and regulations of the FCC would (i) disqualify Buyer from acquiring control of the Governmental Authorizations issued by the FCC for the Stations; or (ii) disqualify Buyer from consummating the transactions contemplated by this Agreement. No waiver of any FCC rule or regulation is required for Buyer to obtain the consent of the FCC to purchase the Shares of the Company and acquire control of the Stations.

5.

CONDITIONS TO OBLIGATIONS OF THE BUYER

        The obligations of the Buyer under this Agreement are, at the option of the Buyer, subject to the conditions that:

        5.1Compliance with Covenants; Representations and Warranties True.    All the terms, covenants, agreement and conditions of this Agreement to be complied with and performed by the Seller and/or the Company on or prior to the Closing Date shall have been fully complied with and performed; the representations and warranties made by the Seller and/or the Company herein shall be true and correct in all material respects on and as of the Closing Date with the same force and effect as though such representations and warranties had been made on and as of the Closing Date (except that any such representations and warranties which expressly relate to an earlier date shall be true and correct in all material respects on the Closing Date as of such earlier date). Notwithstanding the foregoing, Seller shall not be deemed to have breached or failed to comply with Section 3.24 if such breach or failure is due or caused directly by an act, omission, or instruction of Buyer under or in connection with a Time Brokerage Agreement signed by Buyer and Seller, or any activities or transactions by Buyer in furtherance thereof or in connection therewith or any action of Seller in accordance with the terms of such Time Brokerage Agreement (except for such actions of Seller that constitute gross negligence or willful misconduct). The Buyer and Seller acknowledge that there may be an adverse change in the operations of the Company resulting from its potential change in ownership, but this in no way affects the provisions of Section 3.24.

        5.2Legal Proceedings.    There shall not be any Proceeding by or before any court, administrative agency or other Governmental Body (i) which seeks to restrain, prohibit or invalidate any of the transactions contemplated by this Agreement, (ii) which might affect the right of the Buyer to own in its entirety or control the Company.

        5.3Consents to Assignments.    The Seller and the Buyer shall have received the Consents or waivers indicated in Parts 3.4 and 4.3 of the Disclosure Schedule as may be required by the terms thereof.

        5.4FCC Consent.    The FCC Consent shall have been obtained, without the imposition of any condition materially adverse to Buyer except those that are customary in the assignment of FCC Licenses, and the Company shall have complied with any conditions imposed on it by the FCC Consent; provided however, that the Company shall have no obligation to comply with any such condition that is materially adverse to the Company.

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        5.5Resignations of Officers and Directors.    On or prior to the Closing Date, the Buyer shall have received the signed resignations dated the Closing Date, of all or any of the directors or officers of the Company as the Buyer shall have requested.

        5.6Intentionally Deleted.

        5.7Environmental Report.    The Buyer must receive a report from the Phase I environmental study it performs on the Owned Real Property that does not disclose a material adverse environmental condition. The Seller and the Company hereby authorize the Buyer, at its sole cost and expense, to perform a Phase I environmental study on the Owned Real Property as deemed necessary by the Buyer. If, however, the subject report discloses a material adverse environmental condition of the Owned Real Property that is unacceptable to Buyer, Buyer shall immediately notify the Company and Seller, and allow the same a reasonable time to remedy the respective unacceptable condition, which shall in no event exceed 60 days after the Closing Date.

        5.8Studio Lease.    The Company shall have entered into a five year lease (with a five year renewal option) for the studios of the Stations at the current premises in the form of the draft lease attached as Part 5.8 of the Disclosure Schedule.

6.

CONDITIONS TO OBLIGATIONS OF THE SELLER

        The obligations of the Seller under this Agreement are, at the option of the Seller, subject to the conditions that:

        6.1Compliance with Covenants; Representations and Warranties True.    All the terms, covenants, agreement and conditions of this Agreement to be complied with and performed by the Buyer on or prior to the Closing Date shall have been fully complied with and performed; the representations and warranties made by the Buyer herein shall be true and correct in all material respects on and as of the Closing Date with the same force and effect as though such representations and warranties had been made on and as of the Closing Date (except that any such representations and warranties which expressly relate to an earlier date shall be true and correct in all material respects on the Closing Date as of such earlier date).

        6.2Legal Proceedings.    There shall not be any Proceeding by or before any court, administrative agency or other Governmental Body which seeks to restrain, prohibit or invalidate any of the transactions contemplated by this Agreement.

        6.3Consents to Assignments.    The Seller and the Buyer shall have received the Consents or waivers indicated in Parts 3.4 and 4.3 of the Disclosure Schedule as may be required by the terms thereof.

        6.4FCC Consent.    The FCC Consent shall have been obtained, without the imposition of any condition materially adverse to Seller except those that are customary in the assignment of FCC Licenses, and the Company shall have complied with any conditions imposed on it by the FCC Consent; provided however, that the Company shall have no obligation to comply with any such condition that is materially adverse to the Company.

7.

APPLICATION TO FCC

        (a)  No later than ten (10) days after the date of this Agreement, Seller and Buyer shall prepare and jointly file with the FCC all necessary applications ("FCC Applications") requesting the written consent to the transfer from Seller to Buyer of control of the Company as contemplated in this Agreement. In the event that the merger of Buyer and Univision Communications Inc. ("Univision"), MB Docket No. 02-235, has not been consummated at the time the FCC Applications are to be filed, the FCC Applications also shall include an application seeking consent to the transfer of control of the

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Company from Seller to Buyer as owned and controlled by Univision. Buyer shall use its best efforts to secure the cooperation of Univision in the preparation and prosecution of the FCC Applications.

        (b)  Seller and Buyer shall thereafter prosecute such FCC Applications in good faith and with all reasonable diligence and otherwise use their Best Efforts to obtain the FCC Consent as expeditiously as practicable; provided, however, that neither Seller nor Buyer shall have any obligation to satisfy any complainant or the FCC by taking any steps which would have a material adverse effect upon Seller or Buyer or upon any affiliated entity, but neither the expense nor inconvenience to a party of defending against a complainant or an inquiry by the FCC shall be considered a material adverse effect on such party. If the FCC Consent imposes any condition on any party hereto, such party shall use its best efforts to comply with such condition; provided, however, that no party shall be required to comply with any condition that would have a material adverse effect upon it or any affiliated entity. If rehearing, reconsideration or judicial review is sought by a third party or by the FCC on its own motion with respect to the FCC Consent, Buyer and Seller shall vigorously oppose such efforts for rehearing, reconsideration or judicial review; provided, however, that nothing herein shall be construed to limit either party's right to terminate this Agreement pursuant to Section 11. All FCC filing or grant fees with respect to such FCC Consent shall be paid equally by Buyer and Seller. Each party shall otherwise bear its own costs and expenses (including the fees and disbursements of its counsel) in connection with the preparation of the portion of FCC Applications to be prepared by it and in connection with the processing and defense of the FCC Applications.

8.

CONTROL OF THE STATION

        Notwithstanding any provision otherwise contained herein, in no event shall Buyer, prior to the Closing, directly or indirectly, control, supervise, direct, or attempt to control, supervise, or direct, the operations of the Stations; such operations, including complete control and supervision of the Stations' programs, employees, and policies, shall be the sole responsibility of Seller until the Closing.

9.

COVENANTS OF SELLER PRIOR TO CLOSING DATE

        9.1Access and Investigation.    Between the date of this Agreement and the Closing Date, Seller will, and will cause the Company to, (a) afford Buyer reasonable access to the Company's personnel, properties, contracts, books and records, and other relevant documents, (b) furnish Buyer with copies of all such contracts, books and records, and other existing documents and data as Buyer may reasonably request, and (c) furnish Buyer with such additional financial, operating, and other data and information as Buyer may reasonably request.

        9.2Operation of the Businesses of the Company.    Between the date of this Agreement and the Closing Date, Seller will cause the Company to:

        (a)  conduct its business only in the Ordinary Course of Business, except as specifically otherwise set forth herein;

        (b)  use its Best Efforts to preserve the current business organization, keep available the services of the current officers, employees, and agents, and maintain the relations with suppliers, customers, landlords, creditors, employees, agents, and others having business relationships with the Company; and

        (c)  keep the Stations' aggregate barter obligations, as of the Closing Date, at an amount that is equal to or less than $200,000 in excess of the Stations' aggregate barter assets. The aggregate barter liabilities currently exceed barter assets by approximately $184,000. If at any time prior to Closing the Stations anticipate assuming additional barter obligations, such decision will in good faith be discussed with Buyer.

Notwithstanding the foregoing, the Company may pay, if properly declared, dividends to Seller.

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        9.3Negative Covenant.    Except as otherwise expressly permitted by this Agreement, between the date of this Agreement and the Closing Date, Seller will not, and will cause the Company not to, take any affirmative action, or fail to take any reasonable action within their or its control, as a result of which any of the changes or events listed in Section 3.22 is likely to occur.

        9.4Notifications.    Between the date of this Agreement and the Closing Date, Seller will promptly notify Buyer, in writing, if Seller or the Company becomes aware of any fact or condition that causes or constitutes a Breach of any of Seller's representations and warranties as of the date of this Agreement. Seller will promptly deliver to Buyer a supplement to the Disclosure Schedule specifying such change. Any such supplement shall be deemed to amend any representation or warranty made by Seller under this Agreement but it shall not have any effect on the determination of whether the conditions set forth in Section 5.1 have been satisfied by Seller.

        9.5No Negotiation.    Until such time, if any, as this Agreement is terminated pursuant to Section 11, Seller will not, and will cause the Company not to, directly or indirectly solicit, initiate, or encourage any inquiries or proposals from, discuss or negotiate with, provide any non-public information to, or consider the merits of any unsolicited inquiries or proposals from, any Person (other than Buyer) relating to any transaction involving the sale of the business or assets (other than in the Ordinary Course of Business) of the Company, or any of the capital stock of the Company, or any merger, consolidation, business combination, or similar transaction involving the Company.

        9.6Best Efforts.    Between the date of this Agreement and the Closing Date, Seller will use its Best Efforts to cause the conditions in Section 5 to be satisfied.

        9.7Excluded Assets and Liabilities.    Prior to the Closing, Seller will cause the Company (i) to distribute or dispose of the assets listed on Part 9.7 of the Disclosure Schedule and (ii) to retire or otherwise be released from obligation with respect to the liabilities listed on Part 9.7 of the Disclosure Schedule.

        9.8Environmental Compliance.    By no later than 60 days after the Closing Date, Seller will cause the Company to bring all environmental matters set forth on Part 3.23 of the Disclosure Schedule into full and complete compliance with the Environmental Laws.

10.

COVENANTS OF BUYER PRIOR TO CLOSING DATE

        10.1Best Efforts.    Between the date of this Agreement and the Closing Date, Buyer will use its Best Efforts to cause the conditions in Section 6 to be satisfied.

        10.2Notification.    Between the date of this Agreement and the Closing Date, Buyer will promptly notify Seller, in writing, if Buyer becomes aware of any fact or condition that causes or constitutes a breach of any of Buyer's representations and warranties as of the date of this Agreement. Buyer will promptly deliver to Seller a supplement to the Disclosure Schedule specifying such change.

11.

TERMINATION

11.1Terminating Events.

        (a)  In addition to other available remedies, this Agreement may be terminated by either Buyer or Seller, if the party seeking to terminate is not in material default or breach of this Agreement, upon written notice to the other if:

          (i)  the other party is in material breach of this Agreement and such breach has been neither cured within thirty (30) days after written notice of such breach nor waived by the party giving such termination notice;

        (ii)  a court of competent jurisdiction or governmental, regulatory or administrative agency or commission shall have issued an order, decree or ruling or taken any other action permanently

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restraining, enjoining or otherwise prohibiting the transactions contemplated by this Agreement and such order, decree, ruling or other action shall have become final and nonappealable;

        (iii)  the Closing has not occurred by February 8, 2004 (the "Upset Date")

        (b)  This Agreement may be terminated by mutual written consent of Buyer and Seller.

        (c)  If either party believes the other to be in breach or default of this Agreement, the non-defaulting party shall, prior to exercising its right to terminate hereunder, provide the defaulting party with notice specifying in reasonable detail the nature of such breach or default. Except for a failure to pay the Purchase Price, the defaulting party shall have thirty (30) days from receipt of such notice to cure such default; provided that, if the breach or default is due to no fault of the defaulting party and is not capable of cure within such thirty (30) day period, the cure period shall be extended as long as the defaulting party is diligently and in good faith attempting to effect a cure. Nothing in this section shall be interpreted to extend the Upset Date.

        11.2Effect of Termination.    Each party's right of termination under Section 11 is in addition to any other rights it may have under this Agreement or otherwise, and the exercise of a right of termination will not be an election of remedies. If this Agreement is terminated pursuant to Section 11, all further obligations of the parties under this Agreement will terminate, except that the obligations in Sections 13.1 and 13.3 will survive; provided, however, that if this Agreement is terminated by a party because of the breach of the Agreement by the other party or because one or more of the conditions to the terminating party's obligations under this Agreement is not satisfied as a result of the other party's failure to comply with its obligations under this Agreement, the terminating party's right to pursue all legal remedies will survive such termination unimpaired.

12.

INDEMNIFICATION; REMEDIES

        12.1Survival after the Closing.    All representations, warranties, covenants, and obligations in this Agreement will survive the Closing for a period of 18 months after the Closing, except the representations and warranties contained in Section 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.8, 3.12(a), the last sentence in Section 3.15(a), 4.1, 4.2 and 4.3, which shall survive indefinitely, the representations contained in Section 3.11, which shall survive for a period of 6 years, and the representations contained in Section 3.23, which shall survive for a period of 3 years from the Closing Date.

        12.2Indemnification and Payment of Damages by Seller.    Seller will indemnify and hold harmless Buyer, the Company, and their respective Representatives, stockholders, controlling persons, and affiliates (collectively, the "Indemnified Persons") for, and will pay to the Indemnified Persons the amount of, any loss, liability, claim, damage (including incidental and consequential damages), expense (including costs of investigation and defense and reasonable attorneys' fees) or diminution of value, whether or not involving a third-party claim (collectively, "Damages"), arising, directly or indirectly, from or in connection with:

        (a)  any Breach of any representation or warranty made by Seller in this Agreement or in any certificate delivered by Seller pursuant to this Agreement;

        (b)  any Breach of any representation or warranty made by Seller in this Agreement as if such representation or warranty were made on and as of the Closing Date, other than any such Breach that is disclosed in a supplement to the Disclosure Letter and is expressly identified in the certificate delivered pursuant to Section 2.4(a)(ii) as having caused the condition specified in Section 5.1 not to be satisfied;

        (c)  any Breach by Seller of any covenant or obligation of such Seller in this Agreement;

        (d)  any claim by any Person for brokerage or finder's fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by any such Person with either

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Seller or the Company (or any Person acting on their behalf) in connection with any of the Contemplated Transactions;

        (e)  any litigation involving the Company, Seller or their respective employees or representatives arising with respect to periods on or before the Closing Date; and

        (f)    any liability for Taxes to the extent the Seller is liable under the provisions of Section 12.10.

        12.3Indemnification and Payment of Damages by Buyer.    Buyer will indemnify and hold harmless Seller (an "Indemnified Person"), and will pay to Seller, the amount of any Damages arising, directly or indirectly, from or in connection with (a) any Breach of any representation or warranty made by Buyer in this Agreement or in any certificate delivered by Buyer pursuant to this Agreement, (b) any Breach by Buyer of any covenant or obligation of Buyer in this Agreement, (c) any claim by any Person for brokerage or finder's fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by such Person with Buyer (or any Person acting on its behalf) in connection with any of the Contemplated Transactions or (d) any liability for Taxes to the extent the Buyer is liable under the provisions of Section 12.10.

        12.4Time Limitations.

        (a)  If the Closing occurs, Seller will have no liability (for indemnification or otherwise) with respect to any representation or warranty, or covenant or obligation to be performed and complied with prior to the Closing Date, other than those in Sections 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.8, 3.12(a), the last sentence of Section 3.15(a), 3.11, and 3.23 unless on or before eighteen (18) months after the Closing, Buyer notifies Seller of a claim specifying the factual basis of that claim in reasonable detail to the extent then known by Buyer. A claim with respect to Section 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.8, 3.12(a), and the last sentence of 3.15(a) shall have no time limitation. In the case of the representations and warranties contained in Section 3.11 the claim must be made on or before 6 years after the Closing Date, and in the case of the representations and warranties contained in Section 3.23, the claim must be made on or before 3 years after the Closing Date.

        (b)  If the Closing occurs, Buyer will have no liability (for indemnification or otherwise) with respect to any representation or warranty, or covenant or obligation to be performed and complied with prior to the Closing Date, other than those in Sections 4.1, 4.2 and 4.3, unless on or before two years after the Closing, Seller notifies Buyer of a claim specifying the factual basis of that claim in reasonable detail to the extent then known by Buyer. A claim with respect to Section 4.1, 4.2, or 4.3 shall have no time limitation.

        12.5Limitations on Amount.    Seller will have no liability (for indemnification or otherwise) with respect to the matters described in Section 12.2 until the total of all Damages with respect to such matters exceeds $50,000, and then only for the amount by which such Damages in the aggregate exceed $50,000.

        12.6Limitations on Amount.    Buyer will have no liability (for indemnification or otherwise) with respect to the matters described in Section 12.3 until the total of all Damages with respect to such matters exceeds $50,000, and then only for the amount by which such Damages exceed $50,000.

        12.7Procedure for Indemnification-Third Party Claims.

        (a)  Promptly after receipt by an Indemnified Person under Section 12.2 or 12.3 of notice of the commencement of any Proceeding against it, such Indemnified Person will give notice to the indemnifying party of the commencement of such claim, but the failure to notify the indemnifying party will not relieve the indemnifying party of any liability that it may have to any Indemnified Person, except to the extent that the indemnifying party demonstrates that the defense of such action is prejudiced by the Indemnified Person's failure to give such notice.

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        (b)  If any Proceeding referred to in Section 12.7(a) is brought against an Indemnified Person and it gives notice to the indemnifying party of the commencement of such Proceeding, the indemnifying party will, unless the claim involves Taxes, be entitled to participate in such Proceeding and, to the extent that it wishes to assume the defense of such Proceeding with counsel satisfactory to the Indemnified Person and, after notice from the indemnifying party to the Indemnified Person of its election to assume the defense of such Proceeding, the indemnifying party will not, as long as it diligently conducts such defense, be liable to the Indemnified Person under this Section 12 for any fees of other counsel or any other expenses with respect to the defense of such Proceeding, in each case subsequently incurred by the Indemnified Person in connection with the defense of such Proceeding, other than reasonable costs of investigation. If the indemnifying party assumes the defense of a Proceeding, (i) it will be conclusively established for purposes of this Agreement that the claims made in that Proceeding are within the scope of and subject to indemnification; (ii) no compromise or settlement of such claims may be effected by the indemnifying party without the Indemnified Person's consent and (iii) the Indemnified Person will have no liability with respect to any compromise or settlement of such claims effected without its consent. If notice is given to an indemnifying party of the commencement of any Proceeding and the indemnifying party does not, within ten days after the Indemnified Person's notice is given, give notice to the Indemnified Person of its election to assume the defense of such Proceeding, the indemnifying party will be bound by any determination made in such Proceeding or any compromise or settlement effected by the Indemnified Person.

        12.8Procedure for Indemnification—other Claims.    A claim for indemnification for any matter not involving a third-party claim may be asserted by notice to the party from whom indemnification is sought.

        12.9Indemnity Escrow.    In the event that Seller fails to satisfy any claim for indemnification made by Buyer hereunder, Buyer may assert a claim against the funds held pursuant to the Post-Closing Indemnity Escrow Agreement.

        12.10Indemnification for Taxes.

        (a)  The Seller shall indemnify the Buyer Indemnified Parties and hold them harmless from all liability for Taxes of the Company for Pre-Closing Tax Periods (as defined below). Interest and penalties due with respect to all Pre-Closing Tax Periods shall be deemed to be Taxes for such Pre-Closing Tax Periods. As used herein, "Pre-Closing Tax Period" means any taxable period ending on or before the Closing Date and the portion ending on and including the Closing Date of any taxable period that includes (but does not end on) the Closing Date. Notwithstanding the foregoing, the Seller shall not indemnify and hold harmless Buyer from any liability for Taxes (i) accrued in full on the Estimated Closing Balance Sheet, (ii) attributable to any action taken after the Closing by Buyer, any of Buyer's affiliates (including the Company or any of its subsidiaries) or any transferee of Buyer or any of its affiliates for periods after the Closing Date (a "Buyer Tax Act") or (iii) attributable to a breach by Buyer of its obligations under this Agreement.

        (b)  Buyer shall, and shall cause the Company to, indemnify the Seller and hold it harmless from (i) all liability for Taxes of the Company for any taxable period ending after the Closing Date (except to the extent such taxable period began before the Closing Date, in which case Buyer's indemnity will cover only that portion of any such Taxes that are not for the Pre-Closing Tax Period), and (ii) all liability for Taxes attributable to a Buyer Tax Act.

        (c)  In the case of any taxable period that includes (but does not end on) the Closing Date (a "Straddle Period"), (i) the sales and use Taxes, and Taxes based upon or measured with reference to net income, of the Company for the portion of the Straddle Period that constitutes a Pre-Closing Tax Period shall be computed as if such taxable period ended as of the close of business on the Closing Date and (ii) the other Taxes of the Company for the portion of the Straddle Period that constitutes a Pre-Closing Tax Period shall be computed on a per diem basis

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(including property taxes and municipal license taxes), provided that any such per diem computation shall be adjusted where relevant to reflect the actual proportionate period of property ownership during the applicable Tax period for any such other Tax with respect to the ownership of specific items of property held by the Company or its subsidiaries during any Tax period including the Closing Date. All property taxes and municipal license taxes will be provided on a per-diem basis to the fiscal year to which the same are applicable. The Buyer, at its sole cost and expense, shall prepare the Company's 2003 income tax return, which shall be approved by Seller (such approval not to be unreasonably withheld) prior to filing.

13.

GENERAL PROVISIONS

        13.1Expenses.    Except as otherwise expressly provided in this Agreement, each party to this Agreement will bear its respective expenses incurred in connection with the preparation, execution, and performance of this Agreement and the Contemplated Transactions, including all fees and expenses of agents, representatives, counsel, and accountants. All fees and expenses to be borne by the Company hereunder shall be accrued on the Estimated Closing Balance Sheet.

        13.2Public Announcements.    Any public announcement or similar publicity with respect to this Agreement or the Contemplated Transactions will be issued, if at all, at such time and in such manner as Buyer and Seller jointly determine. Seller and Buyer will consult with each other concerning the means by which the Company' employees, customers, and suppliers and others having dealings with the Company will be informed of the Contemplated Transactions.

        13.3.Confidentiality.    Buyer and Seller shall each keep confidential all information obtained by it with respect to the other in connection with this Agreement, except where such information is known through other lawful sources or where its disclosure is required in accordance with applicable law. If the transactions contemplated hereby are not consummated for any reason, (i) Buyer and Seller shall return to the other, without retaining a copy thereof in any medium whatsoever, any schedules, documents or other written information, including all financial information, obtained from the other in connection with this Agreement and the transactions contemplated hereby, and (ii) the Buyer and Seller shall destroy all internal documentation (recorded in any medium whatsoever) containing Confidential Information (as defined in that certain Confidentiality Agreement executed by Buyer and Seller, and dated July 7, 2002) obtained from the other party. Except as is required for the consummation of the transaction contemplated by this Agreement, during the period from the date hereof through the Closing Date, both Buyer and Seller shall also keep confidential the fact that the parties have entered into this Agreement and all other matters relating to this transaction.

        13.4Notices.    All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when (a) delivered by hand (with written confirmation of receipt), (b) sent by telecopier (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (c) when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and telecopier numbers set forth below (or to such other addresses and telecopier numbers as a party may designate by notice to the other parties):

        Seller:

Fundación Angel Ramos, Inc.
PO Box 362408
San Juan, Puerto Rico 00936-3507
Attention: Mrs. Argentina S. Hills, President
Telephone: (787) 763-3776
Facsimile No.: (787) 250-4421

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        with a copy to:

Fiddler, González & Rodríguez
PO Box 363507
San Juan, Puerto Rico 00936-3507
Attention: Rafael Cortés Dapena, Esq.
Telephone: (787) 759-3179
Facsimile No.: (787) 754-7539

        Buyer:

Hispanic Broadcasting Corporation
3102 Oak Lawn Avenue, Suite 215
Dallas, Texas 75219
Attention: Jeffrey T. Hinson, Senior Vice President
Telephone: (214) 525-7711
Facsimile: (214) 525-7750

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

Hallett & Perrin, P.C.
2001 Bryan Street, Suite 3900
Dallas, Texas 75201
Attention: Bruce H. Hallett
Telephone: (214) 922-4120
Facsimile: (214) 922-4170

        13.5Jurisdiction; Service of Process.    Any action or proceeding seeking to enforce any provision of, or based on any right arising out of, this Agreement shall be brought against any of the parties in the courts of the Commonwealth and each of the parties consents to the jurisdiction of such courts (and of the appropriate appellate courts) in any such action or proceeding and waives any objection to venue laid therein.

        13.6Further Assurances.    The parties agree (a) to furnish upon request to each other such further information, (b) to execute and deliver to each other such other documents, and (c) to do such other acts and things, all as the other party may reasonably request for the purpose of carrying out the intent of this Agreement and the documents referred to in this Agreement.

        13.7Waiver.    The rights and remedies of the parties to this Agreement are cumulative and not alternative. Neither the failure nor any delay by any party in exercising any right, power, or privilege under this Agreement or the documents referred to in this Agreement will operate as a waiver of such right, power, or privilege, and no single or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege. To the maximum extent permitted by applicable law, (a) no claim or right arising out of this Agreement or the documents referred to in this Agreement can be discharged by one party, in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by the other party; (b) no waiver that may be given by a party will be applicable except in the specific instance for which it is given; and (c) no notice to or demand on one party will be deemed to be a waiver of any obligation of such party or of the right of the party giving such notice or demand to take further action without notice or demand as provided in this Agreement or the documents referred to in this Agreement.

        13.8Entire Agreement and Modification.    This Agreement supersedes all prior agreements between the parties with respect to its subject matter and constitutes (along with the documents referred to in this Agreement) a complete and exclusive statement of the terms of the agreement

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between the parties with respect to its subject matter. This Agreement may not be amended except by a written agreement executed by the parties.

        13.9Disclosure Schedule.

        (a)  The Disclosure Schedule, as amended prior to Closing, shall be considered an integral part of this Agreement. The disclosures in the Disclosure Schedule, and those in any supplement thereto, relate to all the representations and warranties in this Agreement. A disclosure under any Part of the Disclosure Schedule shall be deemed to be a disclosure under any other relevant Part of the Disclosure Schedule, so long as internal references on the respective Disclosure Schedules refer to the specific location (within the Disclosure Schedule) where the required information is disclosed.

        (b)  In the event of any inconsistency between the statements in the body of this Agreement and those in the Disclosure Schedule (other than an exception expressly set forth as such in the Disclosure Schedule) the statements in the body of this Agreement will control.

        13.10Assignments, Successors, and No Third-party Rights.    Neither party may assign any of its rights under this Agreement without the prior consent of the other party except that Buyer may assign any of its rights under this Agreement to one or more Subsidiaries of Buyer, in which case Buyer shall remain liable for any and all obligations of Buyer under this Agreement. Subject to the preceding sentence, this Agreement will apply to be binding in all respects upon, and inure to the benefit of the successors and permitted assigns of the parties. Nothing expressed or referred to in this Agreement will be construed to give any Person other than the parties to this Agreement any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement. This Agreement and all of its provisions and conditions are for the sole and exclusive benefit of the parties to this Agreement and their successors and assigns.

        13.11Severability.    If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

        13.12Section Headings, Construction.    The headings of the Sections in this Agreement are provided for convenience only and will not affect its construction or interpretation. All references to "Section" or "Sections" refer to the corresponding Section or Sections of this Agreement. All words used in this Agreement will be construed to be of such gender or number as the circumstances require. Unless otherwise expressly provided, the word "including" does not limit the preceding words or terms.

        13.13Time of Essence.    With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence.

        13.14Governing Law.    This Agreement will be governed by the laws of the Commonwealth without regard to conflicts of laws principles.

        13.15Counterparts.    This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement.

        13.16Initial Escrow Amount.    As good faith deposit and security for its obligations under this Agreement, the Buyer has deposited with Banco Popular de Puerto Rico (the "Initial Escrow Agent") the amount of $1,600,000 (the" Initial Escrow Amount") pursuant to an Escrow Agreement in the form attached hereto as Part 13.16 of the Disclosure Schedule (the "Initial Escrow Agreement"). At the Closing, and upon the Buyer complying with its obligations hereunder, the Initial Escrow Amount will be returned to the Buyer, or at Buyer's option, the Initial Escrow Amount will be delivered to Seller and the Purchase Price will be offset by such amount. All interest on the Initial Escrow Amount shall be paid to Buyer on a quarterly basis.

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        13.17Collection of Accounts Receivable.    After the Closing, the Company shall use its Best Efforts to collect all receivables of the Company included in the Estimated Closing Date Balance Sheet. All payments by the customers will be credited to the oldest invoice.

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

FUNDACIÓN ANGEL RAMOS, INC.
By:	/s/  ARGENTINA S. HILLS Argentina S. Hills President
HISPANIC BROADCASTING CORPORATION
By:	/s/  JEFFREY T. HINSON Jeffrey T. Hinson Senior Vice President

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Exhibit 10.17

CONFIDENTIAL STOCK PURCHASE AGREEMENT
RECITALS
AGREEMENT

EX-10.18

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Exhibit 10.18

ASSET PURCHASE AGREEMENT

        THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made as of the 3rd day of March, 2003 ("Effective Date"), by and among First Broadcasting Investments, L.P. ("Seller"), HBC Sacramento, Inc. ("HBC Sacramento") ("HBC Sacramento"), HBC License Corporation ("HBC License" and together with HBC Sacramento, "Station Purchaser"), and HBC Broadcasting Texas, L.P. ("HBC Texas" and together with Station Purchaser, the "Purchaser").

W I T N E S S E T H:

        WHEREAS, Seller is the licensee of radio station KNGT(FM) (the "Station"), licensed to Jackson, California and authorized by the Federal Communications Commission (the "FCC") to operate at 94.3 MHz; and

        WHEREAS, Seller owns the assets which are used in the operation of the Station; and

        WHEREAS, Seller owns a broadcasting tower and related real estate and building located at the coordinates of North 32-35-10.5 Latitude, West 097-49-53.1 Longitude, approximately kilometers north of Granbury, Texas (the "Granbury Tower Assets"); and

        WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to purchase from Seller, (i) certain of the radio station properties and assets relating to the Station and (ii) the Granbury Tower Assets (collectively referred to herein as the "Purchased Assets"), as described herein under the terms and conditions herein set forth;

        NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements herein contained, the parties hereto agree as follows:

1.    PURCHASE AND SALE OF ASSETS.

        1.1  Purchase and Sale of Purchased Assets.

A.    Subject to the conditions set forth in this Agreement, at the Closing (as defined hereinafter), Seller shall assign, transfer, convey and deliver to Station Purchaser, and Station Purchaser shall purchase from Seller, all right, title and interest in and to the following assets, free and clear of all Liens (other than Permitted Liens):

        (a)  all licenses, construction permits or authorizations issued by or pending before the FCC or any other governmental authority for use in the operation of the Station that are set forth on Schedule 1.1(a) attached hereto, together with any and all renewals, extensions and modifications thereof (the "Governmental Licenses");

        (b)  the leasehold interests of Seller at the transmitter site located at 20200 South Cedar Lane, Pine Grove, CA 95665 (North Latitude, 38 degrees, 24 minutes, 10 seconds; West Longitude, 120 degrees, 39 minutes, 15 seconds) (the "Transmitter Site"), and at the studio site located at 1500 S. Highway 49, Suite 206, Jackson, CA 95642 (the "Studio Site");

        (c)  all towers, antennas, transmission equipment and other tangible personal property of Seller located at or used in conjunction with the Transmitter Site (the "Transmitter Equipment");

        (d)  the other items of tangible personal property used, or intended for use, primarily in the operation of the Station, all as described on Schedule 1.1(d) hereto;

        (e)  the call letters, Marti frequencies and internet domain names of the Station;

        (f)    unless as may be otherwise required by law, the books and records related to the Purchased Assets, such as property tax records, logs, all materials maintained in the FCC public file relating to the Station, technical data, political advertising records and all other records,

correspondence with and documents pertaining to governmental authorities and similar third parties (the "Business Records"); and

        (g)  the contracts and agreements listed on Schedule 1.1(g) attached hereto (the "Assumed Contracts").

B.    Subject to the conditions set forth in this Agreement, at the Closing (as defined hereinafter), Seller shall assign, transfer, convey and deliver to HBC Texas, and HBC Texas shall purchase from Seller, all right, title and interest in and to the Granbury Tower Assets, free and clear of all Liens (other than Permitted Liens):

        1.2  Excluded Assets.    In no event shall the Purchased Assets be deemed to include:

        (a)  the cash and cash equivalents of Seller or the Station (except for any normal and customary deposits with respect to the Purchased Assets for which a proration adjustment is made in Seller's favor pursuant to Section 16.2);

        (b)  any accounts receivable, notes receivable or other receivables of Seller (including tax refunds);

        (c)  any items of intellectual property of the Station, except as specifically set forth in Section 1.1 above;

        (d)  the corporate seal, minute books, charter documents, corporate stock record books and other books and records that pertain to the organization of Seller;

        (e)  securities of any kind owned by Seller;

        (f)    insurance contracts or proceeds thereof;

        (g)  claims arising out of acts occurring before the Closing Date; and

        (h)  any agreements not included among the Assumed Contracts.

        1.3  Liabilities to be Assumed.    Subject to the terms and conditions of this Agreement, on the Closing Date, Purchaser expressly does not and shall not assume or agree to perform and discharge any Liabilities of Seller except (a) Liabilities that relate to or arise from the ownership or operation of the Purchased Assets from and after the Closing Date, (b) Liabilities under the Assumed Contracts that relate to or arise from and after the Closing Date and (c) Liabilities for which Purchaser receives a credit, and only to the extent of such credit, in connection with the determination of the proration items pursuant to Section 16.2 of this Agreement (the Liabilities described in subparagraphs (a), (b) and (c) of this Section 1.3, collectively, the "Assumed Liabilities").

        1.4  Liabilities Not to be Assumed.    Except as and to the extent specifically set forth in Section 1.3 of this Agreement, Purchaser is not assuming any Liabilities of Seller, and all such Liabilities shall be and remain the responsibility of Seller. Notwithstanding the provisions of Section 1.3 of this Agreement, Purchaser is not assuming, and Seller shall not be deemed to have transferred to Purchaser the following Liabilities:

        (a)  Any Liability with respect to any action, suit, proceeding, arbitration, investigation or inquiry, whether civil, criminal or administrative ("Litigation") related to or arising from the period prior to the Closing Date.

        (b)  All Liabilities incurred by Seller in connection with the preparation and negotiation of this Agreement and the consummation of the transactions contemplated herein, including, without limitation, tax liabilities (except to the extent otherwise allocated pursuant to Section 16.2 hereof), the fees and expenses of attorneys, accountants, investigators, auditors, consultants and brokers to Seller.

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        (c)  Except to the extent Purchaser receives a credit pursuant to the determination of the proration items pursuant to Section 16.2 hereof, any Liability of Seller for Federal income taxes and any state or local income, profit, franchise or property taxes, and any penalties or interest due on account thereof.

        (d)  Liabilities of Seller for any breach or failure to perform any of its covenants and agreements contained in, or made pursuant to, this Agreement, or, prior to the Closing, any other contract, whether or not assumed hereunder, including any breach arising from assignment of contracts hereunder without consent of third parties.

        (e)  Liabilities of Seller for any violation of a Law or Order.

        (f)    Liabilities of Seller to its present or former Affiliates.

        (g)  Liabilities to or in respect of employees of the Station, including salary, payroll taxes, unemployment compensation, pension, profit sharing, retirement, bonus, medical, dental, life, accident insurance, disability, executive or deferred compensation, and other similar fringe or employee benefit plans.

        (h)  Liabilities of Seller for borrowed money or for interest on such borrowed money.

        (i)    Liabilities of Seller resulting from the failure to comply with, or imposed pursuant to, any Environmental Law (as hereinafter defined), prior to the Closing or resulting from the Release (as hereinafter defined) of Hazardous Substances (as hereinafter defined), in relation to the Station to the extent related to, arising from or otherwise attributable to Seller's acts or omissions prior to or conditions existing as of the Closing Date, including, without limitation, any liability or obligation for cleaning up waste disposal sites from or related to Seller's acts or omissions on or prior to the Closing Date.

        (j)    Any agreements not included among the Assumed Contracts listed on Schedule 1.1(g), including, but not limited to trade and barter agreements.

2.    PURCHASE PRICE; CLOSING.

        2.1  Purchase Price.    The consideration to be received by Seller in exchange for the Purchased Assets shall be Twenty Four Million Dollars ($24,000,000), payable in cash at the Closing by wire transfer of immediately available funds.

        2.2  Time of Closing.

        (a)  The closing (the "Closing") for the sale and purchase of the Purchased Assets shall be held at the offices of Purchaser (or such other place as may be agreed upon by the parties in writing). The Closing shall occur on such date (the "Closing Date") that is five business days after the satisfaction of all conditions precedent to the parties' obligations hereunder, but in no event prior to May 1, 2003. The Closing shall be deemed to be effective as of 12:01 a.m. on the Closing Date.

        (b)  In order to consummate the transfer of the Purchased Assets, Seller and Purchaser agree to use their reasonable best efforts to file, within five business days after the date hereof, an assignment of license application (the "FCC Applications") requesting FCC consent to the assignment from Seller to HBC License of the FCC Licenses. In the event that the merger of Hispanic Broadcasting Corporation and Univision Communications Inc. ("Univision"), MB Docket No. 02-235, has not been consummated at the time the FCC Applications are to be filed, the FCC Applications also shall include an application seeking consent to the assignment from Seller to HBC License as owned and controlled by Univision. Station Purchaser shall use its best efforts to secure the cooperation of Univision in the preparation and prosecution of the FCC Applications. The parties agree that the FCC Applications will be prosecuted with reasonable best efforts, in

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good faith and with due diligence. The parties agree to use their reasonable best efforts to file additional information or amendments requested by the FCC orally or in writing within five business days after such request and, in any event, to commence preparation of such additional information or amendments immediately upon request and to complete and file the same with the FCC as rapidly as practical. Each party will be solely responsible for the expenses incurred by it in the preparation, filing and prosecution of the FCC Applications (it being understood that the parties will bear equally the FCC filing fee payable in connection with the FCC Applications).

        (c)  As used herein, the term "FCC Order" shall mean that the FCC (or the staff of the FCC's Media Bureau pursuant to delegated authority) has granted or given its initial consent, without any condition materially adverse to Purchaser or Seller, to the assignment of the FCC Licenses as contemplated in the FCC Applications.

        2.3  [Intentionally Omitted.]

        2.4  Closing Procedure.    At the Closing, Seller shall deliver to Purchaser such bills of sale, instruments of assignment, transfer and conveyance documents and other similar documents as Purchaser shall reasonably request in a form reasonably acceptable to both Seller and Purchaser. Against such delivery, Purchaser shall (i) issue and deliver to Seller the purchase price in accordance with Section 2.1 above and (ii) execute and deliver the assumption agreement with respect to the Assumed Liabilities. Each party will cause to be prepared, executed and delivered all other documents required to be delivered by such party pursuant to this Agreement. All actions taken at the Closing shall be deemed to have been taken simultaneously at the time the last of any such actions is taken or completed.

        2.5  Allocation of Purchase Price.    The Purchase Price shall be allocated among the Purchased Assets in a manner as mutually agreed to in writing between the parties, based upon an appraisal of the Purchased Assets by Bond & Pecaro (the fees of which firm shall be paid by the Purchaser). Seller and Purchaser agree to use the allocations determined pursuant to this Section 2.5 for all tax purposes, including without limitation, those matters subject to Section 1060 of the Internal Revenue Code of 1986, as amended.

        2.6  Escrow Agreement.    On the Effective Date, Purchaser and Seller shall execute the escrow agreement attached hereto as Schedule 2.6 ("Escrow Agreement") and, pursuant to the Escrow Agreement, Purchaser shall deliver one million two hundred thousand dollars ($1,200,000) to Bank of New York Trust Company of Florida, N.A. ("Escrow Agent"), which amount, but not the interest thereon, shall be retained by Escrow Agent and applied to the Purchase Price at Closing. Following the Closing, the interest earned on this deposit shall promptly be delivered to Purchaser. If this Agreement is terminated in accordance with the provisions of Section 13 herein due to breach or default by the Seller, Escrow Agent shall refund to Purchaser the deposit and all accrued interest thereon within ten (10) days of termination of this Agreement. If this Agreement is terminated in accordance with the provisions of Section 13 herein due to breach or default on the part of the Purchaser, Escrow Agent shall pay to the Seller the deposit together with all interest accrued thereon within ten (10) days of termination of this Agreement.

3.    REPRESENTATIONS AND WARRANTIES OF SELLER.

        Seller hereby represents and warrants to Purchaser, as follows:

        3.1  Organization; Good Standing.    Seller is a Delaware limited partnership, duly organized, validly existing and in good standing under the laws of the State of Delaware. Seller has all requisite power and authority to own and lease its properties and carry on its business as currently conducted.

        3.2  Due Authorization.    Subject to the FCC Order, Seller has full power and authority to enter into and perform this Agreement and to carry out the transactions contemplated hereby. Seller has

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taken all necessary corporate action to approve the execution and delivery of this Agreement and the transactions contemplated hereby. This Agreement constitutes the legal, valid and binding obligation of Seller, enforceable against it in accordance with its terms, except as may be limited by the availability of equitable remedies or by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally.

        3.3  Execution and Delivery.    Neither the execution and delivery by Seller of this Agreement nor the consummation by Seller of the transactions contemplated hereby will: (i) conflict with or result in a breach of any provisions of Seller's organizational documents; (ii) subject to the FCC Order, violate any Law or Order of any court or Governmental Entity, which violation, either individually or in the aggregate, might reasonably be expected to have a material adverse effect on Purchaser's ownership of the Purchased Assets; (iii) except as set forth on Schedule 3.3, violate or conflict with or constitute a default under (or give rise to any right of termination, cancellation or acceleration under), or result in the creation of any Lien on any of the Purchased Assets pursuant to, any material agreement, indenture, mortgage or other instrument to which Seller is a party or by which it or its assets may be bound or affected; or (iv) subject to the FCC Order, affect or violate the terms or conditions of or result in the cancellation of the FCC Licenses.

        3.4  Absence of Undisclosed Liabilities.    Except as and to the extent specifically disclosed in Schedule 3.4, Seller does not have any Liabilities relating to the Purchased Assets other than Liabilities incurred in the ordinary course of business and consistent with past practice and none of which has had or would be reasonably likely to have a Material Adverse Effect.

        3.5  Governmental Consents.    No approval, authorization, consent, order or other action of, or filing with, any Governmental Entity is required in connection with the execution and delivery by Seller of this Agreement or the consummation by Seller of the transactions contemplated hereby, other than those of the FCC.

        3.6  Title to Purchased Assets.    On the Closing Date, Seller shall have good and marketable title to all the Purchased Assets, free and clear of all Liens, except for Permitted Liens. Except for approval of the transfer of ownership by the FCC and the Third Party Consents, none of the Purchased Assets are subject to any restriction with respect to the transferability thereof. Seller has complete and unrestricted power and right to sell, assign, convey and deliver the Purchased Assets to Purchaser as contemplated hereby. At Closing, Purchaser will receive good and marketable title to all the Purchased Assets, free and clear of all Liens, except for Permitted Liens. The purchase and sale of the Purchased Assets and the other transactions contemplated in this Agreement will be free and clear of any and all claims by creditors of Seller under any bulk sales or similar laws or statues.

        3.7  Transmitter and Studio Sites.

        (a)  Seller has a valid and enforceable leasehold interest in and to the Transmitter Site and the Studio Site, free and clear of Liens, except for Permitted Liens.

        (b)  Seller has not received any written notice of, and has no knowledge of, any material violation of any zoning, building, health, fire, water use or Law in connection with the Transmitter Site or the Studio Site. To the knowledge of Seller, no fact or condition exists which would result in the termination or material impairment of access of the Station to the Transmitter Site or Studio Site or discontinuation of necessary sewer, water, electrical, gas, telephone or other utilities or services, except as set forth on Schedule 3.7(b). In addition, any and all additions, modification, and repairs that have been made to the tower constituting the Granbury Tower Assets have been completed by its manufacturer and have in all respects been performed in compliance with, and the tower is currently in compliance with, all industry standards and the FCC rules and regulations, and is not currently in need of any material repairs or modifications.

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        3.8  Tangible Personal Property Assets.Schedule 1.1(d) sets forth a list, complete and accurate in all material respects, of the Purchased Assets, which consist of tangible personal property. Except as set forth on Schedule 1.1(d), all material items of such tangible personal property are in good condition and working order, ordinary wear and tear excepted, and are suitable for the uses for which intended, free from any known defects except such minor defects that do not interfere with the continued present use thereof by Seller.

        3.9  Governmental Licenses.Schedule 1.1(a) lists and accurately describes all of the Governmental Licenses necessary for the lawful ownership and operation of the Station and the conduct of their businesses, except where the failure to hold such Governmental License would not have a Material Adverse Effect. Seller has furnished to Purchaser true and accurate copies of all of the Governmental Licenses. Each such Governmental License is in full force and effect and is valid under applicable Laws; the Station is being operated in compliance in all material respects with the Communications Act of 1934, as amended, and all rules, regulations and policies of the FCC; and to the knowledge of Seller, no event has occurred which (whether with or without notice, lapse of time or the happening or occurrence of any other event) is likely to result in the revocation or termination of any Governmental License or the imposition of any restriction of such a nature as would have a Material Adverse Effect. The Station, each of its physical facilities, electrical and mechanical systems and transmitting and studio equipment are being operated in all material respects in accordance with the specifications of the Governmental Licenses. The Governmental Licenses are unimpaired by any act or omission of Seller or any of Seller's officers, directors or employees and Seller has fulfilled and performed all of its obligations with respect to the Governmental Licenses and has full power and authority thereunder. Except as set forth on Schedule 3.9, no application, action or proceeding is pending for the renewal or modification of any of the Governmental Licenses. No event has occurred which, individually or in the aggregate, and with or without the giving of notice or the lapse of time or both, would constitute ground for revocation thereof.

        3.10 Reports.    Seller has duly filed all reports required to be filed by Law or applicable rule, regulation, order, writ or decree of any court, Governmental Entity and has made payment of all charges and other payments, if any, shown by such reports to be due and payable, except where the failure to so file or make payment would not have a Material Adverse Effect. Except as set forth on Schedule 3.10, all reports required to be filed by Seller with the FCC with respect to the Station have been filed, except where the failure to so file would not, individually or in the aggregate, materially and adversely affect the business, operations, properties, assets or conditions (financial or otherwise) of the Station or which challenges the validity or propriety of any of the transactions contemplated by this Agreement. Such reports and disclosures are complete and accurate in all material respects.

        3.11 Taxes.

        (a)  All tax reports and returns required to be filed on or before the execution of this Agreement by Seller relating to the Purchased Assets have been duly filed on a timely basis under the statutes, rules and regulations of each applicable jurisdiction, and Seller will file or will cause to be duly filed, all tax returns required to be filed by Seller relating to the Purchased Assets with respect to any taxable period prior to the Closing Date. All such tax reports and returns are (or will be) complete and accurate in all material respects.

        (b)  No claim, judgment, Lien, settlement, writ, or order for assessment or collection of taxes relating to the Purchased Assets has been asserted against Seller. Seller is not a party to any pending, or to the Seller's knowledge, any threatened, audit, action, suit, claim, litigation, proceeding or investigation by any Governmental Entity for the assessment or collection of taxes relating to the Purchased Assets.

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        (c)  Except for Permitted Liens, no Liens (whether filed or arising by operation of law) have been imposed upon or asserted against any of the Purchased Assets as a result of or in connection with any failure, or alleged failure to pay any tax.

        (d)  Seller has not waived or extended any statutes of limitation for the assessment or collection of taxes relating to the Purchased Assets. To Seller's knowledge, no claim has been made by a Governmental Entity relating to the Purchased Assets in a jurisdiction where the Seller does not currently file Tax Returns that the Seller may be subject to taxation by that jurisdiction, nor is Seller aware that any such assertion of tax jurisdiction is pending or threatened.

        3.12 Environmental Matters.

        (a)  As used herein, (i) the term "Environmental Laws" shall mean any and all state, federal, and local statutes, regulations and ordinances relating to the protection of human health and the environment, (ii) the term "Hazardous Material" shall mean any hazardous or toxic substance, material, or waste including, without limitation, those substances, materials, pollutants, contaminants and wastes listed in the United States Department of Transportation Hazardous Materials Table (49 C.F.R. §172.101) or by the United States Environmental Protection Agency as hazardous substances (40 C.F.R. Part 302 and amendments thereto), petroleum products (as defined in Title I to the Resource Conservation and Recovery Act, 42 U.S.C. §6991-6991(i)) and their derivatives, and such other substances, materials, pollutants, contaminants and wastes as become regulated or subject to cleanup authority under any Environmental Laws, and (iii) the term "Release" shall have the meaning set forth in Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §§9601 et seq. ("CERCLA").

        (b)  Seller represents and warrants that:

        (i)    all activities of Seller with respect to the operation of the Station have been and are being conducted in material compliance with all Environmental Laws;

        (ii)  Seller has no knowledge of the Release of any Hazardous Material on, in, from or onto the Transmitter Site, except in accordance with Environmental Laws;

        (iii)  to Seller's knowledge, no Hazardous Materials are present in any medium at the Transmitter Site in such a manner as requires investigation or remediation under any Environmental Law;

        (iv)  to Seller's knowledge, no polychlorinated biphenyls or substances containing polychlorinated biphenyls are present on the Transmitter Site; and

        (v)  to Seller's knowledge, no friable asbestos is present on the Transmitter Site.

        3.13 Insurance.    Seller has fire, liability and other forms of insurance applicable to the Purchased Assets, each of which is in an amount customary and standard to the industry practice, in full force and effect on the date hereof, which are, to Seller's knowledge, valid and enforceable in accordance with their terms and are in an amount consistent with past practices. No event or claim has occurred, including, without limitation, the failure by Seller to give any notice or information, or the delivery of any inaccurate or erroneous notice or information, or any reservation of rights, which limits or impairs in any material respect the rights of the insured parties under any such insurance policies with respect to the Purchased Assets.

        3.14 Litigation.    There is no Order and no action, suit, proceeding or investigation, judicial, administrative or otherwise that is pending or, to Seller's knowledge, threatened against or affecting the Station which, if adversely determined would reasonably be expected to have a Material Adverse Effect or which challenges the validity or propriety of any of the transactions contemplated by this Agreement.

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        3.15 Contracts and Agreements.    The Station is not in default in any material respect with respect to the Assumed Contracts, and, as of the Closing Date, the Station will have paid all sums and performed in all material respects all obligations under the Assumed Contracts, which are required to be paid or performed prior to the Closing Date. In addition, the obligations, costs and expenses associated with the Assumed Contract, and specifically the Weatherford ground lease referenced on Schedule 1.1(g), will not increase as a result of the consummation of the transactions contemplated in this Agreement.

        3.16 Business Records.    Seller has, and after the Closing, Purchaser will have, the right to use the Business Records included in the Purchased Assets, free and clear of any royalty or other payment obligations.

        3.17 Third Party Consents.    The only consents from any person or entity which are required to be obtained by Seller in connection with the execution and delivery by Seller of this Agreement and the consummation of the transactions contemplated hereby are set forth on Schedule 3.17 (the "Third Party Consents").

        3.18 Finders and Brokers.    No person has, as a result of any agreement entered into by Seller, any valid claim against any of the parties hereto for a brokerage commission, finder's fee or other like payment.

4.    REPRESENTATIONS AND WARRANTIES OF PURCHASER.

        Purchaser hereby represents and warrants to Seller as follows:

        4.1  Organization and Good Standing.    Each of HBC License and HBC Sacramento is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware and has all requisite power and authority to own and lease its properties and carry on its business as currently conducted. HBC Texas is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Texas and has all requisite power and authority to own and lease its properties and carry on its business as currently conducted.

        4.2  Due Authorization.    Subject to the FCC Order, Purchaser has full power and authority to enter into this Agreement and to carry out its obligations hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Purchaser. This Agreement has been duly executed and delivered by Purchaser and constitutes the legal, valid and binding obligation of Purchaser, enforceable against it in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally or general equitable principles.

        4.3  Execution and Delivery.    Neither the execution and delivery by Purchaser of this Agreement nor the consummation of the transactions contemplated hereby will: (i) conflict with or result in a breach of the certificate of incorporation or bylaws of Purchaser; (ii) subject to the FCC Order, violate any Law or Order of any court or Governmental Entity; or (iii) violate or conflict with or constitute a default under (or give rise to any right of termination, cancellation or acceleration under) any indenture, mortgage, lease, contract or other instrument to which Purchaser is a party or by which it is bound or affected.

        4.4  Consents.    No consent, approval, authorization, license, exemption of, filing or registration with any court, governmental authority, commission, board, bureau, agency or instrumentality, domestic or foreign, is required by Purchaser in connection with the execution and delivery of this Agreement or the consummation by Purchaser of any transaction contemplated hereby, other than the consent of the FCC. No approval, authorization or consent of any other third party is required in connection with the execution and delivery by Purchaser of this Agreement and the consummation of the transactions

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contemplated hereby, except as may have been previously obtained by Purchaser. Purchaser warrants that it is legally qualified to become a licensee of the Station and is aware of no impediment to the approval by the FCC of the assignment of the Governmental Licenses to Purchaser.

        4.5  Finders and Brokers.    No person has, as a result of any agreement entered into by Purchaser, any valid claim against any of the parties hereto for a brokerage commission, finder's fee or other like payment.

5.    CERTAIN COVENANTS AND AGREEMENTS.

        5.1  Consummation of the Transaction.

        (a)  Each of Seller and Purchaser shall take all reasonable action necessary to consummate the transactions contemplated by this Agreement and will use all necessary and reasonable means at its disposal to obtain (and cooperate with the other party in obtaining) all necessary approvals of the FCC and Third Party Consents required to enable it to consummate the transactions contemplated by this Agreement. Except as otherwise provided herein, each of Seller and Purchaser acknowledges and agrees that it shall pay all costs, fees and expenses incurred by it in obtaining such necessary consents and approvals. Each party shall make all filings, applications, statements and reports to all Governmental Entities which are required to be made prior to the Closing Date by or on its behalf pursuant to any statute, rule or regulation in connection with the transactions contemplated by this Agreement, and copies of all such filings, applications, statements and reports shall be provided to the other.

        (b)  Seller will use its reasonable best efforts to obtain all Third Party Consents as promptly as practicable after the date of this Agreement; provided, that, notwithstanding anything to the contrary set forth in this Agreement, Seller shall have no obligations to pay money to obtain any Third Party Consents unless Seller is required to pay money by the express terms of any Assumed Contract in connection with the assignment thereof. All Third Party Consents shall be in form reasonably satisfactory to Purchaser, and none shall provide for any increase in cost or other change in terms and conditions after the Closing which would be adverse to Purchaser.

        5.2  Public Announcements.    Prior to the Closing Date, all notices to third parties and other publicity relating to the transaction contemplated by this Agreement shall be jointly planned and agreed to by Seller and Purchaser; provided, however, that each party shall be entitled to issue a press release announcing the entering of this Agreement and the transactions contemplated hereby in accordance with its respective obligations under federal securities laws.

        5.3  Ordinary Course of Business.    During the period from the date hereof to the Closing Date, unless the prior consent of Purchaser is first obtained, Seller shall cause the Station to not knowingly take any action which would cause the conditions set forth in Section 6.1 not to be satisfied as of the Closing Date.

        5.4  Control of the Station.    Prior to the Closing, Purchaser shall not, directly or indirectly, control, supervise, direct, or attempt to control, supervise, or direct, the operations of the Station; such operations, including complete control and supervision of all of the Station's programs, employees, and policies, shall be the sole responsibility of Seller until the Closing.

        5.5  Pre-Closing Covenants.    From the date hereof until the Closing or earlier termination of this Agreement without a closing, Seller covenants and agrees with Purchaser as follows:

        (a)  Seller shall operate the Station in the ordinary course of business consistent with past practices.

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        (b)  Seller shall maintain, preserve, renew and keep in favor and effect the existence, rights and franchises of Seller that pertain to the Station and shall continue to comply with the Communications Act, the rules and regulations of the FCC, and all applicable Laws and Orders.

        (c)  Seller shall not do or omit any act, or permit any omission to act, which may cause a breach of any material contract, commitment or obligation, or any breach of any representation, warranty, covenant or agreement made by Seller herein, which would cause the conditions set forth in Section 6.1 not to be satisfied as of the Closing Date.

        (d)  Seller shall not, without prior consent of the Purchaser, create, assume or permit to exist any Lien affecting any of the Purchased Assets, except for Permitted Liens.

        (e)  Seller shall not, without prior consent of the Purchaser, cause or permit any action or failure to act that would cause the Governmental Licenses to expire or be surrendered or adversely modified, or take any action or fail to take any action that would cause the FCC or any other Government Entity to institute proceedings for the suspension, revocation or adverse modification of any of the Governmental Licenses.

        (f)    Seller shall maintain all of Seller's insurance related to the Purchased Assets in effect as of the date hereof.

        (g)  Seller shall maintain the Purchased Assets in good repair and condition, ordinary wear and tear excepted, and shall use, operate, maintain and repair, and replace with an asset of equal or greater value, if necessary, the Purchased Assets in a normal business manner.

        (h)  Seller shall not directly or indirectly (through a representative or otherwise) solicit or furnish any information to any prospective buyer, commence, or conduct presently ongoing, discussions or negotiations with any other party or enter into any agreement with any other party concerning the sale of the Station or the Purchased Assets or any part thereof (an "Acquisition Proposal"), and Seller shall immediately advise Purchaser of the receipt of any written Acquisition Proposal.

        5.7  Update of Schedules.    From time to time after the execution of this Agreement and prior to the Closing, Seller will use reasonable best efforts to promptly supplement or amend the Schedules delivered in connection herewith with respect to any matter which exists or occurs after the date of this Agreement and which, if existing or occurring at or prior to the date of this Agreement, would have been required to be set forth or described in the Schedules or which is necessary to correct any information therein; provided, however, that the provisions of this Section 5.7 are informational only and Purchaser shall not be bound to the terms of any changed Schedules unless they are incorporated into this Agreement by a written amendment signed by Purchaser.

6.    CONDITIONS TO PURCHASER'S CLOSING.

        All obligations of Purchaser under this Agreement shall be subject to the fulfillment at or prior to the Closing of the following conditions, it being understood that Purchaser may, in its sole discretion, waive any or all of such conditions in whole or in part:

        6.1  Representations, Etc.    Seller shall have performed in all material respects the covenants and agreements contained in this Agreement that are to be performed by it at or prior to the Closing. The representations and warranties of Seller contained in this Agreement shall be true and correct as of the Closing Date with the same effect as though made at such time (except as contemplated or permitted by this Agreement), except where the failure of such representations and warranties to be true and correct would not, individually or in the aggregate, have a Material Adverse Effect.

        6.2  FCC Order.    The FCC Order shall have been granted.

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        6.3  No Injunctions.    No order or temporary, preliminary or permanent injunction or restraining order shall have been entered which would have the effect of (i) making any of the transactions contemplated hereby illegal or (ii) materially adversely affecting the value of the Purchased Assets.

        6.4  Third Party Consents.    The Third Party Consents listed on Schedule 3.17 hereto shall have been obtained in form reasonably acceptable to Purchaser, without the imposition of any additional cost or other conditions materially adverse to Purchaser.

        6.5  Material Adverse Effect.    No Material Adverse Effect shall have occurred since the date of this Agreement.

        6.6  Closing Deliveries.    Purchaser shall have received each of the documents or items required to be delivered to it pursuant to Section 8.1 hereof.

        6.7  Modification Agreement.    Seller and Nevada County Broadcasters, Inc., licensee of Station KNCO(FM), Grass Valley, California, shall have entered into a Modification Agreement substantially in the form of Schedule 6.7 and such Modification Agreement shall be in full force and effect as of the Closing Date. Seller shall have assigned to Purchaser, in a manner reasonably acceptable to Purchaser, all of Seller's rights, title, and interest in the Modification Agreement (it being understood that Purchaser will not be assuming any liability thereunder). Without the prior written consent of Purchaser, Seller shall not materially amend the Modification Agreement or consent to such amendment by Nevada County or a subsequent assignee of KNCO(FM) prior to assigning the Modification Agreement to Purchaser.

7.    CONDITIONS TO SELLER'S CLOSING.

        All obligations of Seller under this Agreement shall be subject to the fulfillment at or prior to the Closing of the following conditions, it being understood that Seller may, in its sole discretion, waive any or all of such conditions in whole or in part:

        7.1  Representations, Etc.    Purchaser shall have performed in all material respects the covenants and agreements contained in this Agreement that are to be performed by Purchaser as of the Closing, and the representations and warranties of Purchaser contained in this Agreement shall be true and correct in all material respects as of the Closing Date with the same effect as though made at such time (except as contemplated or permitted by this Agreement).

        7.2  FCC Order.    The FCC Order shall have been granted.

        7.3  No Injunctions.    No order or temporary, preliminary or permanent injunction or restraining order shall have been entered which would have the effect of (i) making any of the transactions contemplated hereby illegal or (ii) materially adversely affecting the value of the Purchased Assets.

        7.4  Closing Deliveries.    Seller shall have received each of the documents or items required to be delivered to it pursuant to Section 8.2.

        7.5  Third Party Consents.    The Third Party Consents shall have been obtained.

8.    DOCUMENTS TO BE DELIVERED AT THE CLOSING.

        8.1  To Purchaser.    At the Closing, there shall be delivered to Purchaser:

        (a)  The bills of sale, agreements of assignment and similar instruments of transfer to the Purchased Assets contemplated by Section 2.4 hereof.

        (b)  The Business Records.

        (c)  The Third Party Consents, which Seller shall have obtained as of the Closing Date.

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        (d)  A termination of the lease of the Granbury Tower Assets in form and substance reasonably acceptable to HBC Texas.

        (e)  All other documents to effectuate the transactions contemplated hereby as Purchaser may reasonably request.

        8.2  To Seller.    At the Closing, there shall be delivered to Seller:

        (a)  The purchase price contemplated by Section 2.1 hereof, in the form of wire transfer or cashier's or certified check as Seller may direct.

        (b)  An assumption agreement pursuant to which Purchaser shall assume the Assumed Contracts.

        (c)  A termination of the lease of the Granbury Tower Assets in form and substance reasonably acceptable to Seller.

        (d)  All other documents to effectuate the transactions contemplated hereby as Seller may reasonably request.

9.    SURVIVAL.

        All representations, warranties, covenants and agreements made by any party to this Agreement or pursuant hereto shall be deemed to be material and to have been relied upon by the parties hereto and shall survive the Closing for a period of twelve (12) months, provided, however, that notice of any claim against Purchaser or Seller, whether made under the indemnification provisions hereof or otherwise, based on a breach of a representation, warranty, covenant or agreement must be given within thirty (30) calendar days from the expiration of such twelve (12) month survival period. The representations and warranties hereunder shall not be affected or diminished by any investigation at any time by or on behalf of the party for whose benefit such representations and warranties were made. No representation or warranty contained herein shall be deemed to be made at any time after the Closing Date.

10.    INDEMNIFICATION OF PURCHASER.

        From and after the Closing and subject to the limitations set forth in Sections 9 and 12, Seller shall indemnify and hold Purchaser harmless from, against, for and in respect of:

        (a)  any and all damages, costs, losses, expenses, settlement payments, obligations, liabilities, claims, actions or causes of action and encumbrances (collectively, together with the costs and expenses described in clause (c) below, but excluding any, consequential, or other special damages or lost profits regardless of the theory of recovery, being referred to herein as "Damages") suffered, sustained, incurred or required to be paid by Purchaser because of the breach of any written representation, warranty, agreement or covenant of Seller contained in this Agreement or any document or certificate executed and delivered by Seller pursuant to this Agreement;

        (b)  any and all Damages arising out of the ownership and operation of the Station at all times prior to the Closing Date;

        (c)  any and all Damages arising out of any Liabilities of Seller which are not Assumed Liabilities;

        (d)  any and all Damages arising out of the Assumed Contracts in respect of periods prior to the Closing Date;

        (e)  any and all Damages arising out of the failure of Seller to comply with any bulk sales statute applicable to the transactions contemplated by this Agreement;

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        (f)    all reasonable costs and expenses (including, without limitation, attorneys' fees, interest and penalties) incurred by Purchaser in connection with any action, suit, proceeding, demand, assessment or judgment incident to any of the matters indemnified against in this Section 10;

11.    INDEMNIFICATION OF SELLER.

        From and after the Closing and subject to the limitations set forth in Sections 9 and 12, Purchaser shall indemnify and hold Seller harmless from, against, for and in respect of:

        (a)  any and all Damages suffered, sustained, incurred or required to be paid by Seller because of the breach of any written representation, warranty, agreement or covenant of Purchaser contained in this Agreement;

        (b)  any and all Damages arising out of the ownership and operation of the Station on and after the Closing Date, except to the extent the same arises from a breach of any written representation, warranty, agreement or covenant of Seller contained in this Agreement or any document, certificate or agreement executed in connection with this Agreement;

        (c)  any and all Damages arising out of the Assumed Liabilities from and after the Closing Date; and

        (d)  all reasonable costs and expenses (including, without limitation, attorneys' fees, interest and penalties) incurred by Seller in connection with any action, suit, proceeding, demand, assessment or judgment incident to any of the matters indemnified against in this Section 11.

12.    GENERAL RULES REGARDING INDEMNIFICATION.

        The obligations and liabilities of each indemnifying party hereunder with respect to claims resulting from the assertion of liability by the other party or indemnified third parties shall be subject to the following terms and conditions:

        (a)  The indemnified party shall give prompt written notice (which in no event shall exceed thirty (30) days from the date on which the indemnified party first became aware of such claim or assertion) to the indemnifying party of any claim which might give rise to a claim by the indemnified party against the indemnifying party based on the indemnity agreements contained in Section 11 or 12 hereof, stating the nature and basis of said claims and the amounts thereof, to the extent known.

        (b)  If any action, suit or proceeding is brought against the indemnified party with respect to which the indemnifying party may have liability under the indemnity agreements contained in Section 10 or 11 hereof, the action, suit or proceeding shall, upon the written acknowledgment by the indemnifying party that it is obligated to indemnify under such indemnity agreement, be defended (including all proceedings on appeal or for review) by the indemnifying party with counsel selected by the indemnifying party; provided that the indemnified party also shall have the right to employ its own counsel in any such case at the indemnified party's sole cost and expense. The indemnified party shall be kept fully informed of such action, suit or proceeding at all stages thereof whether or not it is represented by separate counsel.

        (c)  The indemnified party shall make available to the indemnifying party and its attorneys and accountants all books and records of the indemnified party relating to such proceedings or litigation and the parties hereto agree to render to each other such assistance as they may reasonably require of each other in order to ensure the proper and adequate defense of any such action, suit or proceeding.

        (d)  The indemnified party shall not make any settlement of any claims without the written consent of the indemnifying party, which consent shall not be unreasonably withheld or delayed.

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        (e)  If any claims are made by third parties against an indemnified party for which an indemnifying party would be liable, and it appears likely that such claims might also be covered by the indemnified party's insurance policies, the indemnified party shall make a timely claim under such policies and to the extent that such party obtains any recovery from such insurance, such recovery shall be offset against any sums due from an indemnifying party (or shall be repaid by the indemnified party to the extent that an indemnifying party has already paid any such amounts). The parties acknowledge, however, that if an indemnified party is self-insured as to any matters, either directly or through an insurer which assesses retroactive premiums based on loss experience, then to the extent that the indemnified party bears the economic burden of any claims through self-insurance or retroactive premiums or insurance ratings, the indemnifying party's obligation shall only be reduced by any insurance recovery in excess of the amount paid or to be paid by the indemnified party in insurance premiums.

        (f)    Except as herein expressly provided, each of Purchaser and Seller acknowledges and agrees that its sole and exclusive remedy after the Closing with respect to any and all claims and causes of action under or that are reasonably related to this Agreement, and the other transactions contemplated hereby, the Station, the Purchased Assets and the Assumed Contracts shall be pursuant to the indemnification provisions set forth in Sections 10, 11 and 12 hereof. Without limiting the foregoing, Sections 10, 11 and 12 set forth Purchaser's sole and exclusive remedy against Seller arising under Environmental Laws or regarding environmental matters or Hazardous Materials, and Purchaser hereby waives and releases any other claim it now has or may in the future have (including contractual, statutory, contractual, or contribution claims) against Seller with respect to Environmental Laws, environmental matters or Hazardous Materials.

13.    TERMINATION.

        13.1 Termination.    This Agreement may be terminated by the mutual written consent of Purchaser and Seller, or, if the terminating party is not then in material breach of its obligations hereunder, upon written notice as follows:

        (a)  by Purchaser if Seller is in material breach of its obligations hereunder, such that the conditions set forth in Section 6.1 would not be satisfied as of the Closing, and such breach has not been cured by Seller within fifteen (15) business days of written notice of such breach; provided, that Seller shall not be entitled to such fifteen (15) business day cure period with respect to any breach of Seller's obligation to execute and deliver on the Closing Date, the agreements, certificates and documents set forth in Section 8.1;

        (b)  by Seller if Purchaser is in material breach of its obligations hereunder, such that the conditions set forth in Section 7.1 would not be satisfied as of the Closing, and such breach has not been cured by Purchaser within ten (10) business days of written notice of such breach; provided, that Purchaser shall have no right to such ten (10) business day cure period with respect to any breach of Purchaser's obligation to pay the Purchase Price on the Closing Date;

        (c)  by either Purchaser or Seller if the FCC designates the FCC Applications for a hearing; or

        (d)  by either Purchaser or Seller if the Closing has not occurred on or before the date which is twelve (12) months after the date hereof (the "Outside Date"); provided, however, that the failure of the Closing to have occurred on or before the Outside Date shall not be attributable to the breach of this Agreement by the party seeking termination pursuant to this Section 13.1(d).

        13.2 Effect of Termination.    In the event of termination of this Agreement pursuant to Section 13.1 above, all rights and obligations of the parties under this Agreement shall terminate without any liability of any party to any other party (except for any liability of any party for any material breach of this Agreement, in which case any non-breaching party shall have all rights and remedies available at

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law or in equity). Notwithstanding anything to the contrary contained herein, the provisions of Sections 15 and 16.1 shall expressly survive the termination of this Agreement.

14.    RISK OF LOSS.

        Seller shall bear the risk of all damage to, loss of or destruction of any of the Purchased Assets between the date of this Agreement and the Closing Date. If any material portion of the Purchased Assets (other than items that are obsolete and not necessary for the continued operations of the Station) shall suffer any material damage or destruction prior to the Closing Date, Seller shall promptly notify Purchaser in writing of such damage or destruction, shall promptly take all necessary steps to restore, repair or replace such assets at its sole expense, and shall advise Purchaser in writing of the estimated cost to complete such restoration, repair or replacement and all amounts actually paid as of the date of the estimate. In the event of substantial damage to any of the Purchased Assets that can not be restored, repaired or replaced prior to the Closing, Purchaser shall have the right to terminate this Agreement by written notice to Seller and shall have no further liability or obligation hereunder.

15.    SPECIFIC PERFORMANCE.

        The parties acknowledge that the Purchased Assets and the transactions contemplated hereby are unique, that a failure by Seller to complete such transactions will cause irreparable injury to Purchaser, and that actual damages for any such failure may be difficult to ascertain and may be inadequate. Consequently, Seller agrees that Purchaser shall be entitled, in the event of a failure by Seller to complete such transactions, to specific performance of any of the provisions of this Agreement in addition to any other legal or equitable remedies to which Purchaser may otherwise be entitled. If any action is brought by Purchaser against Seller for failure by Seller to complete such transactions, Seller will waive the defense that there is an adequate remedy at law.

16.    MISCELLANEOUS PROVISIONS.

        16.1 Expenses.    Except as otherwise expressly provided herein, each party shall pay the fees and expenses incurred by it in connection with the transactions contemplated by this Agreement. If any action is brought for breach of this Agreement or to enforce any provision of this Agreement, the prevailing party shall be entitled to recover court costs and reasonable attorneys' fees. Purchaser and Seller shall bear equally the transfer taxes, recording fees and similar costs imposed in connection with the transfer of the real property assets included in the Purchased Assets.

        16.2 Prorations.    All items of income and expense arising from the operation of the Station or the ownership and leasing of the Granbury Tower Assets for periods on or before the close of business on the Closing Date shall be for the account of Seller and thereafter shall be for the account of Purchaser. Proration of the items described below between Seller and Purchaser shall be effective as of 11:59 p.m., local time, on such date and shall occur as follows with respect to those rights, liabilities and obligations of Seller transferred to and assumed by Purchaser hereunder.

        (a)  Liability for state and local taxes assessed on the Purchased Assets payable with respect to the tax year in which the Closing Date falls and the annual FCC regulatory fee for the Station payable with respect to the year in which the Closing Date falls shall each be prorated as between Seller and Purchaser on the basis of the number of days of the tax year elapsed to and including the Closing Date.

        (b)  Prepaid items, deposits, credits and accruals such as water, electricity, telephone, other utility and service charges, lease expenses, license fees (if any) and payments under any contracts or utility services to be assumed by Purchaser shall be prorated between Seller and Purchaser on the basis of the period of time to which such liabilities, prepaid items and accruals apply.

        All prorations shall be made and paid insofar as feasible on the Closing Date; any prorations not made on such date shall be made as soon as practicable (not to exceed ninety (90) days) thereafter.

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Seller and Purchaser agree to assume, pay and perform all costs, liabilities and expenses allocated to each of them pursuant to this Section 16.2.

        16.3 Amendment.    This Agreement may be amended at any time but only by an instrument in writing signed by the parties hereto.

        16.4 Notices.    All notices and other communications hereunder shall be in writing and shall be deemed given if mailed by certified mail, return receipt requested, or by nationally recognized "next-day" delivery service, to the parties at the addresses set forth below (or at such other address for a party as shall be specified by like notice), or sent by facsimile to the number set forth below (or such other number for a party as shall be specified by proper notice hereunder):

If to Purchaser:

c/o Hispanic Broadcasting Corporation
3102 Oak Lawn Avenue, Suite 215
Dallas, Texas 75219
Attention: Jeffrey T. Hinson, Senior Vice President
Telephone: (214) 525-7711
Fax: (214) 525-7750

If to Seller:

c/o First Broadcasting Company
750 North St. Paul
Tenth Floor
Dallas, TX 75201
Attention: Gary Lawrence, President
Telephone: (214) 855-4927
Fax: (214) 855-5963

        16.5 Assignment.    This Agreement may not be assigned by either party without the prior consent of the other party. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, heirs and permitted assigns.

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

        16.7 Headings.    The headings of the Sections of this Agreement are inserted for convenience only and shall not constitute a part hereof.

        16.8 Entire Agreement.    This Agreement and the documents referred to herein contain the entire understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties, conveyances or undertakings other than those expressly set forth herein. This Agreement supersedes any prior agreements and understandings between the parties with respect to the subject matter.

        16.9 Waiver.    No attempted waiver of compliance with any provision or condition hereof, or consent pursuant to this Agreement, will be effective unless evidenced by an instrument in writing by the party against whom the enforcement of any such waiver or consent is sought.

        16.10 Governing Law.    This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, excluding the choice of law rules thereof.

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

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        "Affiliates" of a party shall mean persons or entities that directly, or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, such party.

        "FCC Licenses" shall mean the licenses, construction permits or authorizations issued by or pending before the FCC relating to the Station and set forth on Schedule 1.1(a).

        "Governmental Entity" shall mean any court, arbitrator, department, commission, board, bureau, agency, authority, instrumentality or other body, whether federal, state, municipal, foreign or other.

        "Law" shall mean any statute, law, ordinance, rule or regulation.

        "Liability" shall mean and include any direct or indirect indebtedness, guaranty, endorsement, claim, loss, damage, deficiency, cost, expense, obligation or responsibility, fixed or unfixed, known or unknown, asserted or unasserted, liquidated or unliquidated, secured or unsecured.

        "Liens" shall mean, statutory or otherwise, security interests, claims, pledges, licenses, equities, options, conditional sales contracts, assessments, levies, charges or encumbrances of any nature whatsoever.

        "Material Adverse Effect" or "material adverse effect" shall mean a material adverse effect on the Purchased Assets but shall specifically exclude any material adverse effect caused by (a) factors affecting the radio industry generally or the market in which the Station operates; (b) general, national, regional or local economic or financial conditions; (c) new governmental or legislative laws, rules or regulations; or (d) the failure to achieve any financial or operational targets, projections or milestones set forth in any Seller business plan or budget.

        "Order" shall mean any order, writ, injunction, judgment, plan or decree of any Governmental Entity.

        "Permitted Liens" shall mean (a) Liens for taxes not yet due and payable, (b) Liens for which a proration adjustment is made pursuant to Section 16.2 of this Agreement or (c) in the case of the Granbury Tower Assets, the lease rights in favor of HBC Texas.

        16.12 Intended Beneficiaries.    The rights and obligations contained in this Agreement are hereby declared by the parties hereto to have been provided expressly for the exclusive benefit of such entities as set forth herein and shall not benefit, and do not benefit, any unrelated third parties.

        16.13 Further Assurances.    From time to time, at Seller's request and without further consideration, Purchaser shall execute and deliver to Seller, such documents, instruments and consents and take such other action as Seller may reasonably request in order to consummate more effectively the transactions contemplated hereby, to discharge the covenants of Purchaser and to assign to Purchaser the Assumed Liabilities. The Agreement may be terminated immediately by Seller upon written notice to the Purchaser if the FCC has not accepted and placed on public notice the FCC Applications on or before the tenth day after the filing of the FCC Applications, or if, after such tenth day, the FCC dismisses, denies, or otherwise rejects the FCC Applications as inappropriate for grant (except that it is understood and acknowledged that Purchaser will proceed to dismiss one of the FCC Applications upon the consummation or termination of the merger with Univision). From time to time, at Purchaser's request and without further consideration, Seller shall execute and deliver to Purchaser, such documents, instruments and consents and take such other action as Purchaser may reasonably request in order to consummate more effectively the transactions contemplated hereby, to discharge the covenants of Seller and to vest in Purchaser good, valid and marketable title to the Station and the Purchased Assets.

        16.14 Severability.    If any one or more of the provisions contained in this Agreement should be found invalid, illegal or unenforceable, in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. Any illegal

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or unenforceable term shall be deemed to be void and of no force and effect only to the minimum extent necessary to bring such term within the provisions of applicable law and such term, as so modified, and the balance of this Agreement shall then be fully enforceable.

        16.15 Mutual Contribution.    The parties to this Agreement and their counsel have mutually contributed to its drafting. Consequently, no provision of this Agreement shall be construed against any party on the ground that such party drafted the provision or caused it to be drafted or the provision contains a covenant of such party.

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

First Broadcasting Investments, L.P.
By: First Broadcasting, LLC, its sole general partner
By:	/s/  GARY M. LAWRENCE Gary M. Lawrence President and Vice Chairman
HBC Sacramento, Inc.
By:	/s/  JEFFREY T. HINSON Jeffrey T. Hinson Senior Vice President and Chief Financial Officer
HBC License Corporation
By:	/s/  JEFFREY T. HINSON Jeffrey T. Hinson Senior Vice President and Chief Financial Officer
HBC Broadcasting Texas, LP
By HBC GP Texas, Inc.
By:	/s/  JEFFREY T. HINSON Jeffrey T. Hinson Senior Vice President and Chief Financial Officer

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Exhibit 10.18

ASSET PURCHASE AGREEMENT

EX-10.19

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Exhibit 10.19

ASSET PURCHASE AGREEMENT

        This Asset Purchase Agreement ("Agreement"), made as of the 17th day of March, 2003, is by and among Simmons Lone Star Media, Ltd., a Utah limited partnership ("Licensee"), Simmons-Austin, LLC, a Utah limited liability company ("Operating Company," and collectively with Licensee, the "Seller"), HBC Broadcasting Texas, L.P., a Texas limited partnership ("HBC Texas"), and HBC License Corporation, a Delaware corporation ("HBC License" and together with HBC Texas, the "Buyer").

RECITALS

A.

Licensee is the licensee of Radio Station KTND(FM), licensed to Georgetown, Texas (the "Station"), together with related licenses and authorizations issued by the Federal Communications Commission (the "FCC").



B.

Operating Company is the owner of the operational assets used in the broadcasting of the Station.



C.

Operating Company desires to sell to HBC Texas certain assets, as described herein, relating to the operation of the Station, and HBC Texas desires to purchase such assets on the terms and conditions contained in this Agreement.



D.

Licensee desires to assign its Federal Communications Commission ("FCC") licenses related to the Station to HBC License, subject to consent of the FCC and the terms of this Agreement.



E.

The defined terms shall have the meanings ascribed to them in Article 13.

WITNESSETH:

        NOW, THEREFORE, in consideration of the mutual covenants contained herein, Seller and Buyer hereby agree as follows:

ARTICLE 1
ASSETS TO BE CONVEYED

1.1  Closing. Subject to (i) the provisions of Section 10.1 and (ii) the satisfaction or, to the extent permissible by law, waiver (by the party for whose benefit the closing condition is imposed), on or prior to the date scheduled for the Closing, of the closing conditions set forth in Article 7 hereof, including, for example, the consent of the FCC to the transaction contemplated by this Agreement, the closing (the "Closing") of the sale and purchase of the Station Assets (as defined in Section 1.2) shall take place in the offices of the Buyer, at 11:00 a.m., local time, on the seventh day following the satisfaction or waiver of the conditions set forth in Article 7 (or on the next normal business day if the seventh day is not a normal business day), or at such other place, time or date as Buyer and Seller may mutually agree in writing.

1.2  Transfer of Assets. Subject to the terms and conditions set forth in this Agreement, Seller hereby agrees to sell, assign, transfer, convey and deliver to Buyer on the Closing Date, and Buyer agrees to purchase all of Seller's right, title and interest in, the following assets, free and clear of all Liens, except as otherwise provided in this Agreement, but excluding the assets described in Section 1.3 (collectively, the "Station Assets"):

        (a)  All licenses, permits, construction permits, and other authorizations issued by the FCC, the Federal Aviation Administration, or any other federal, state or local governmental authority to Seller, currently in effect and used in the conduct of the business or operations of the Station, together with renewals or modifications thereof and any additions thereto between the date hereof and the Closing Date, including, without limitation, the licenses, permits and authorizations listed

on Schedule 1.2(a) attached hereto (the licenses, permits and authorizations issued by the FCC collectively are referred to herein as the "FCC Licenses;" and the FCC Licenses and the licenses, permits and other authorizations issued by any other governmental authority collectively are referred to herein as the "Station Licenses");

        (b)  All of Seller's right, title and interest in the towers, equipment, spare parts and other tangible personal property located at the Station' transmitters or studio site and used exclusively in the operation of the Station and in any other tangible personal property identified on Schedule 1.2(b) (the "Personal Property");

        (c)  Seller's right, title and interest in and to (i) the transmitter site lease to be entered into by Seller at the New Transmitter Site (as defined in Section 1.5) upon terms acceptable to Buyer (the "Transmitter Site Lease"), (ii) the other contracts listed on Schedule 1.2(c) hereto (together with the Transmitter Site Lease, the "Assumed Contracts"), provided that, as to any such contract the assignment of which requires the consent of a party other than Seller, such consent is obtained prior to Closing or (iii) are entered into between the date hereof and the Closing which Seller agrees to assign, and Buyer agrees to assume, in writing at Closing, provided that, with respect to any such contract the assignment of which requires the consent of a party other than Seller, such consent is obtained prior to the Closing;

        (d)  Seller's public inspection file, filings with the FCC relating to the Station, and such technical information, engineering data, rights under manufacturers' warranties as exist at Closing and relate exclusively to the assets being conveyed hereunder;

        (e)  All call letters, websites and website domain names used by the Station;

        (f)    All books and records required by the FCC to be kept by the Station; and

        (g)  All of Seller's proprietary information, technical information and data, machinery and equipment warranties, maps, computer discs and tapes, plans, diagrams, blueprints and schematics, including filings with the FCC, relating to the business and operation of the Station.

1.3  Excluded Assets. The Station Assets shall not include the following:

        (a)  All cash, cash equivalents or similar investments such as certificates of deposit, treasury bills and other marketable securities on hand and/or in banks, deposits or prepaid expenses of Seller;

        (b)  All accounts receivable of Seller;

        (c)  Any insurance policies, promissory notes, amounts due from employees, bonds, letters of credit, certificates of deposit, or other similar items, and any cash surrender value in regard thereto;

        (d)  Any pension, profit-sharing or cash or deferred (section 401(k)) plans and trust and assets thereof, and any other employee benefit plan or arrangement and the assets thereof of Seller;

        (e)  Duplicate copies of such records as may be necessary to enable Seller to prepare and file tax returns and reports, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, and all records of Seller relating to the sale of the Station Assets;

        (f)    Any interest in and to any refunds of federal, state or local franchise, income or other taxes for periods prior to the Closing;

        (g)  All tangible and intangible personal property disposed of or consumed between the date of this Agreement and the Closing, as permitted under this Agreement;

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        (h)  Any other assets identified on Schedule 1.3(h);

        (i)    The account books of original entry and general ledgers and all limited partnership and limited liability company records of the Seller, including, but not limited to, tax returns and transfer books;

        (j)    All of Seller's right, title and interest in and to the agreements with advertisers to broadcast commercial messages on the Station which have not been performed as of the Closing;

        (k)  Those agreements and arrangements for the exchange of advertising time for consideration other than money which remain in effect and unfulfilled as of the Closing Date ("Barter Obligations"); and

        (l)    Assets not used by Seller in the operation of the Station.

1.4  Assumption of Liabilities and Obligations. As of the Closing Date, Buyer shall assume and undertake to pay, discharge and perform all obligations and liabilities of Seller arising or accruing after the Closing under the Station Licenses and Assumed Contracts. Buyer shall not assume any other obligations or liabilities of Seller or the Station, including (i) any obligations or liabilities under any contract or agreement not included in the Assumed Contracts, (ii) any obligation or liabilities under the Assumed Contracts relating to the period prior to the Closing except insofar as an adjustment therefore is made in favor of Buyer under Section 2.5, (iii) any claims or pending litigation or proceedings relating to the operation of the Station prior to the Closing, (iv) any obligations or liabilities of Seller which are unrelated to the Station, (v) any agreements, executed or executory, relating to the exchange of broadcast time on the Station for goods, wares, services, advertising, promotions, merchandising or anything other than cash, (vi) any obligations relating to current or former employees of the Station and (vii) any obligations relating to the Excluded Assets.

1.5  Upgrade of Station Facilities. The parties intend to undertake certain efforts to upgrade the Station's signal strength in the greater Austin, Texas metropolitan area, as outlined in the report of Reynolds Technical Associates attached hereto as Schedule 1.5. The parties covenant to implement Option I (referenced on Schedule 1.5) as promptly as practicable. In connection therewith, (i) Seller will, as promptly as practicable and at its expense, file such applications with the FCC requesting that the Station's transmitter site be permitted to relocate to coordinates on the south side of Georgetown, Texas that are mutually acceptable to Buyer and Seller (the "New Transmitter Site") and that the Station be permitted to broadcast from the New Transmitter Site as a Class C-3 radio station operating at 499 feet HAAT; (ii) Seller will, at its expense, complete all engineering studies and obtain all local governmental and third party approvals incident to the commencement of operations at the New Transmitter Site; (iii) Buyer will, at its expense, pay the costs of construction of the transmission facilities at the New Transmitter Site; (iv) Seller will ensure that radio station KFAN(FM) will apply with the FCC to downgrade from Class C-2 to C-3 status; and (v) Buyer shall file an application with the FCC requesting that its KXTN(FM) radio station be reclassified as a Class C-0, conditioned upon the approval of Seller's application. Buyer shall have the sole right and option to determine whether or not the rulemaking contemplated by Option II (referenced on Schedule 1.5) shall be pursued, either concurrently with the pursuit of, or following the completion of, Option I.

1.6  Time Brokerage Agreement. Concurrently with the execution and delivery of this Agreement, the parties are entering into a Time Brokerage Agreement (the "Time Brokerage Agreement"), pursuant to which Seller will make the Station's broadcast facilities available to HBC Texas for the broadcast of programming, including the sale of advertising time in connection therewith by HBC Texas, commencing on April 15, 2003 (the "Time Brokerage Date"). Notwithstanding anything to the contrary contained in this Agreement or otherwise, Seller shall not be deemed to have breached or failed to comply with any representations, warranties, covenants, or agreements with respect to the Station or the Station Assets if such breach or failure is due or caused directly by any act, omission or

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instruction of Buyer under or in connection with the Time Brokerage Agreement or any activities or transactions by Buyer in furtherance thereof or in connection therewith.

ARTICLE 2
PURCHASE PRICE

2.1  Purchase Price. The purchase price (the "Purchase Price") for the Station Assets shall be $16,000,000.

2.2  Deposit. The Buyer has delivered $800,000 (the "Deposit Amount") to Star Media, as the "Escrow Agent," subject to an escrow agreement in substantially the form set forth on Schedule 2.2. The Deposit Amount is to be held subject to the following:

        (a)  If the purchase of the Assets under this Agreement is not consummated due to a breach by the Buyer of any of its obligations under this Agreement, the Seller shall be entitled to the Deposit Amount (together with interest thereon) as liquidated damages, to compensate the Seller for the damages resulting to the Seller from such breach.

        (b)  If the purchase of the Assets under this Agreement is not consummated due to the failure of any of the conditions in Section 7 (other than as a result of the Buyer's breach of any of its obligations under this Agreement), the Seller shall not be entitled to the Deposit Amount (or interest thereon) and, promptly after the termination of this Agreement in accordance with Section 7, the Deposit Amount (together with interest thereon) shall be paid by the Escrow Agent to the Buyer.

        (c)  At the Closing, the parties shall cause the Deposit Amount (together with interest thereon) to be paid to the Seller.

2.3  Payment of Purchase Price. At the Closing, Buyer shall pay Seller the Purchase Price, less the Deposit Amount and subject to the prorations set forth in Section 2.5, by wire transfer of immediately available funds to an account at a bank or other financial institution pursuant to wire transfer instructions that Seller shall deliver to Buyer at least five (5) days prior to the Closing Date.

2.4  Allocation. The Purchase Price shall be allocated for income tax purposes in a manner as mutually agreed between the parties based upon an appraisal prepared by Bond & Pecaro (whose fees shall be paid by Buyer). Such agreed allocations shall be used by the parties in preparing all relevant tax returns, information reports and other tax documents and forms.

2.5  Prorations. All income and expenses arising from the conduct of the business and operations of the Station shall be prorated between Buyer and Seller as of 12.01 a.m. local time, on the Closing Date in accordance with generally accepted accounting principles. Except as may be contemplated by the Time Brokerage Agreement, such prorations shall be based upon the principles that Seller shall be entitled to all income earned and shall be responsible for all liabilities and obligations accruing in connection with the operation of the Station until the Closing Date, and Buyer shall be entitled to such income earned and be responsible for such liabilities and obligations accruing in connection with the operation of the Station thereafter. Such prorations shall include, without limitation, all ad valorem and other property taxes (but excluding taxes arising by reason of the transfer of the Station Assets as contemplated hereby, which shall be paid as set forth in Section 12.1 of this Agreement), deposits, utility expenses, liabilities and obligations under all Assumed Contracts, rents and similar prepaid and deferred items and all other expenses attributable to the ownership and operation of the Station; provided, however, there shall be no adjustment for, and Seller shall remain solely liable for, any contracts or agreements not included in the Assumed Contracts and any other obligation or liability not being assumed by Buyer in accordance with Section 1.4.

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ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER

        Licensee and Operating Company, each as to itself as may be applicable, represents and warrants to Buyer that, except as otherwise disclosed in the schedules to this Agreement (the "Schedule of Exceptions"), the following representations and warranties will be true and correct on the Closing Date, except for those representations and warranties specifically noted as being true and correct as of the date of this Agreement through the Closing Date:

3.1  Organization and Standing.

        (a)  As of the date of this Agreement through the Closing Date, Operating Company (i) is a Utah limited liability company duly formed, validly existing and in good standing under the laws of the State of Utah; and (ii) has all necessary power and authority to carry on the business of the Station.

        (b)  As of the date of this Agreement through the Closing Date, Licensee (i) is a Utah limited partnership duly formed, validly existing and in good standing under the laws of the State of Utah and (ii) has all necessary power and authority to carry on the business of the Station.

3.2  Authorization and Binding Obligation. As of the date of this Agreement through the Closing Date, Operating Company and Licensee each has all necessary power and authority to enter into and perform its respective obligations under this Agreement and the documents contemplated hereby and to consummate the transactions contemplated hereby and thereby. As of the date of this Agreement through the Closing Date, this Agreement has been duly executed and delivered by both Operating Company and Licensee and is enforceable in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency or similar laws affecting creditors' rights generally or the availability of equitable remedies.

3.3  Absence of Conflicting Agreements or Required Consents. As of the date of this Agreement through the Closing Date, the execution, delivery and performance of this Agreement and the documents contemplated hereby (with or without the giving of notice, the lapse of time, or both) by Operating Company and Licensee, respectively: (a) do not and will not violate any provisions of their organizational documents; (b) do not and will not conflict with, result in a material breach of, constitute a default under, or violate any applicable law, judgment, order, ordinance, injunction, decree, rule, regulation or ruling of any court or governmental authority; (c) do not and will not, either alone or with the giving of notice or the passage of time, or both, conflict with, constitute grounds for termination of, result in a material breach of, constitute a material default under, or accelerate or permit the acceleration of any performance required by the terms of, any agreement, lease, instrument, license or permit to which Operating Company or Licensee is a party or by which either Operating Company or Licensee is bound; and (d) will not create any claim, liability, mortgage, lien, pledge, condition, charge, or encumbrance upon any of the Station Assets.

3.4  Litigation. Other than as set forth on Schedule 3.4, there is no claim, action, counterclaim, suit, litigation, labor dispute, arbitration, or other legal, administrative, or tax proceeding, nor any order, decree, or judgment, pending, or to the knowledge of either Operating Company or Licensee threatened, against or relating to either Operating Company or Licensee with respect to the ownership or operation of the Station or otherwise relating to the Station Assets or the business or operations of the Station.

3.5  Station and Other Licenses.

        (a)  Schedule 1.2(a) contains a true and complete list of the Station Licenses, and there are no other licenses, permits or other authorizations required for the lawful operation of the Station in the manner now operated. Licensee has made available to Buyer true and complete copies of the Station Licenses (including any amendments and other modifications thereto). Licensee is the

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authorized legal holder of the Station Licenses. The Station Licenses are in good standing and in full force and effect. To the best of the knowledge of Licensee, the Station and the facilities of the Station are being operated in all material respects in accordance with the FCC Licenses and all material FCC rules and policies.

        (b)  Except as set forth in Schedule 1.2(a), and except for proceedings affecting the radio broadcasting industry generally, there are no applications, petitions, complaints, investigations, forfeitures, proceedings or other actions pending or, to the best of the knowledge of either Operating Company or Licensee, threatened before the FCC relating to the Station or the Station Licenses. Should any such filing be made or action initiated, Operating Company and Licensee shall promptly notify Buyer thereof. To the best of the knowledge of Operating Company and Licensee, the Station' transmission towers and equipment have been operated and maintained by Operating Company in material compliance with the Communications Act and the rules and regulations of the FCC and the Federal Aviation Administration ("FAA"), and the towers have been properly registered with the FCC and approved by the FAA as necessary.

        (c)  Licensee is qualified to hold the FCC Licenses.

        (d)  In addition to the Station Licenses, to the best of the knowledge of Operating Company and Licensee, either Operating Company and Licensee, as may be the case, possess all licenses and other required governmental or official approvals, permits or authorizations, the failure to possess which would have a material adverse effect on the business, financial condition or results of operations of the Station. To the knowledge of Operating Company and Licensee, such licenses, approvals, permits and authorizations are in full force and effect, Operating Company or Licensee, as the case may be, is in compliance with their requirements and no proceeding is pending or threatened to revoke or amend any of them. Schedule 1.2(a) contains a complete list of such licenses, approvals, permits and authorizations.

3.6  Title to and Condition of Station Assets.

        (a)  Except as disclosed on Schedule 1.2(b), Operating Company and Licensee, respectively, have good and marketable title to the Personal Property free and clear of all Liens. Seller owns no real property in connection with the operation of the Station.

        (b)  At the Closing, the Personal Property will be in reasonable condition and working order, ordinary wear and tear excepted, and reasonably suitable for the uses for which intended, free from any defects known to either Operating Company or Licensee, normal wear and tear excepted, and will be in material compliance with the published rules and regulations of the FCC and, to the best of the knowledge of Operating Company or Licensee, all other applicable federal, state and local statutes, ordinances, rules and regulations.

3.7  Assumed Contracts. To the best of the knowledge of Operating Company and Licensee, respectively, the Assumed Contracts are in full force and effect and are legally valid, binding and enforceable by Seller in accordance with their respective terms, except as limited by laws affecting creditor's rights or equitable principles generally. To the best of the knowledge of Operating Company and Licensee, respectively, neither Operating Company nor Licensee is in any material respect in default under Assumed Contracts.

3.8  Compliance with Laws. To the best of the knowledge of Operating Company and Licensee, Operating Company and Licensee, respectively, have complied in all material respects with, and neither is in any material respect in violation of, any federal, state or local laws, statutes, rules, regulations or orders relating to the ownership and operation of the Station.

3.9  Broker's Fees. As of the date of this Agreement through the Closing Date, other than a payment owed by Seller to Star Media Group, neither Seller nor any person or entity acting on Seller's

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behalf has agreed to pay a commission, finder's fee or similar payment in connection with this Agreement or any matter related hereto to any person or entity, and no person or entity is entitled to any such payment from Seller in connection with the transactions contemplated by this Agreement.

3.10 Consents. As of the date of this Agreement, except for the FCC Consent provided in Section 5.1 and the consents with respect to certain of the Assumed Contracts so designated on Schedule 1.2(c), no consent, approval, permit, or authorization of, or declaration to, or filing with any governmental or regulatory authority or any other third party is required (a) to consummate the transactions contemplated hereby; or (b) to permit either Operating Company or Licensee to assign or transfer the Station Assets to Buyer. The assignment or transfer of the Assumed Contracts, including leases, shall be completed at no additional cost to Buyer, and Seller shall save and hold Buyer harmless from any and all such costs.

3.11 Taxes.

        (a)  Operating Company and Licensee has each filed all federal, state, county and local tax returns and reports required to be filed by them with respect to taxes for which successor liability will apply, including payroll, property, withholding, social security, sales and use taxes, to the extent that such taxes relate to the Station Assets; have either paid in full all such taxes that have become due, as reflected on any return or report, and any interest and penalties with respect thereto or have fully accrued on its books or have established adequate reserves for all taxes payable but not yet due; and have made required cash deposits with appropriate governmental authorities representing estimated payments of taxes, including employee withholding tax obligations. No extension or waiver of any statute of limitations or time within which to file any return has been granted to or requested by either Operating Company or Licensee with respect to any such tax. No unsatisfied deficiency, delinquency or default for any such tax, assessment or governmental charge has been assessed (or, to the knowledge of either Seller, claimed or proposed) against Operating Company or Licensee, nor has either Operating Company or Licensee received notice of any such deficiency, delinquency or default.

        (b)  Operating Company and Licensee have paid all required state, county, and local sales tax resulting from sales made in the State of Texas, as such taxes relate to the Station Assets.

3.12 Reports. All reports and statements that either Operating Company or Licensee are required to file with the FCC in respect of the Station have been filed, and all reporting requirements of the FCC have been complied with in all material respects.

3.13 Financial Statements of the Station. Operating Company and Licensee have previously delivered to Buyer the unaudited balance sheet and income statement for the Station as of and for the year ended December 31, 2002. These financial statements have been prepared in all material respects in accordance with generally accepted accounting principles consistently followed by Operating Company and Licensee throughout the periods indicated (except that they may omit certain footnotes required by such principles and the interim financial statements do not reflect normal year-end adjustments and accruals) and fairly present financial position of the Station as of the respective dates of the balance sheets included and the results of their operations for the respective periods indicated.

3.14 Absence of Changes in Seller's Business Operations. With reference to the Station Assets and the operations of the Station, from December 31, 2002 to the date hereof, there has not been any:

        (a)  Transaction by Operating Company or Licensee related to the Station entered into except in the ordinary course of business;

        (b)  Material adverse change in the financial condition, liabilities, assets, business or prospects of Operating Company or Licensee with respect to the Station;

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        (c)  Destruction, damage, or loss of any asset of Operating Company or Licensee (insured or uninsured) that materially and adversely affects the financial condition, business, or prospects of Operating Company or Licensee with respect to the Station;

        (d)  Material change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Operating Company or Licensee with respect to the Station;

        (e)  Sale or transfer of any material asset used by either Operating Company or Licensee in the operation of the Station, except in the ordinary course of business;

        (f)    Amendment or termination of any contract, agreement, or license related to the operation of the Station, except in the ordinary course of business;

        (g)  Commencement or notice or threat of commencement of any civil litigation or any governmental proceeding against or investigation of Operating Company or Licensee or the affairs of either of them; or

        (h)  Labor trouble or claim of wrongful discharge or other unlawful labor practice or action.

3.15 Personnel.

        (a)  Neither Operating Company nor Licensee is a party to or subject to any collective bargaining agreements with respect to the Station. To the best knowledge of Operating Company and Licensee, there is no representation or organizing effort pending or threatened against or involving or affecting either Operating Company or Licensee, as the case may be, with respect to employees employed at the Station. There is no pending or, to the knowledge of Operating Company and Licensee, threatened labor dispute, strike, or work stoppage affecting the Station.

        (b)  Each employee benefit plan that is maintained by Operating Company or Licensee or any member of either company's controlled group of companies (within the meaning of Code Section 414) and in which any Covered Employee participates and that is intended to be "qualified" under Code Section 401(a) has been determined by the Internal Revenue Service to be so qualified (or an application for such a determination has been filed with the Internal Revenue Service); no event has occurred that would have a material adverse effect on the qualified status of any such employee benefit plan; and each trust maintained in connection with each such employee benefit plan is tax-exempt under Code Section 501(a).

        (c)  Neither Operating Company nor Licensee maintains or has maintained, contributes to or has contributed to, or otherwise has any liability for or obligation under any employee pension benefit plan that is a defined benefit plan (as described in Section 3(35) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or a multiemployer plan (as described in ERISA Section 4001(a)(3)).

ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYER

        Buyer represents and warrants to Seller as follows:

4.1  Organization and Standing. HBC License is a corporation duly formed, validly existing and in good standing under the laws of the State of Delaware. HBC Texas is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Texas.

4.2  Authorization and Binding Obligation. Buyer has all necessary power and authority to enter into and perform its obligations under this Agreement and to consummate the transactions contemplated hereby. This Agreement and all other documents required hereby have been duly executed and delivered by Buyer and constitute valid and binding obligations enforceable against Buyer in accordance

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with their terms except as may be limited by applicable bankruptcy, insolvency or similar laws affecting creditors' rights generally or the availability of equitable remedies.

4.3  Absence of Conflicting Agreements or Required Consents. Except for the FCC Consent, the execution, delivery and performance of this Agreement by Buyer: (a) do not and will not violate any provision of Buyer's organizational documents; (b) do not and will not require the consent of any third party or governmental authority; (c) do not and will not violate any law, judgment, order, injunction, decree, rule, regulation or ruling of any governmental authority; and (d) do not and will not, either alone or with the giving of notice or the passage of time, or both, conflict with, constitute grounds for termination or acceleration of or result in a breach of the terms, conditions or provisions of, or constitute a default under, any agreement, lease, instrument, license or permit to which Buyer is now subject.

4.4  Absence of Litigation. There is no claim, litigation, arbitration or proceeding pending or, to the best of Buyer's knowledge, threatened, before or by any court, governmental authority or arbitrator, that seeks to enjoin or prohibit, that questions the validity of or that might materially hinder or impair Buyer's performance of its obligations under this Agreement.

4.5  FCC Qualifications. To the best of Buyer's knowledge, Buyer is qualified under the Communications Act of 1934, as amended, and the rules and regulations of the FCC to be the assignee of the FCC Licenses, it being understood that Buyer has a duty to ascertain what would cause it to lose such qualification. There are no facts known to Buyer that would delay the consummation of the transactions contemplated by this Agreement. Buyer has no reason to believe that the FCC assignment contemplated hereby might be challenged or might not be granted by the FCC in the ordinary course solely because of its qualifications.

4.6  Broker's Fees. Neither Buyer nor any person or entity acting on its behalf has agreed to pay a commission, finder's fee or similar payment in connection with this Agreement or any matter related hereto to any person or entity, and no person or entity is entitled to any such payment from Buyer in connection with the transactions contemplated by this Agreement.

4.7  Financial Qualifications. Buyer is financially qualified to consummate the transactions contemplated by this Agreement and to certify to its financial qualifications on FCC Form 314.

4.8  Seller's Representations and Warranties. Buyer has not relied on or been induced to enter into this Agreement by any statement, representation or warranty other than those expressly set forth in Article 3 of this Agreement.

ARTICLE 5
GOVERNMENTAL CONSENTS

5.1  FCC Application.

        (a)  The assignment of the FCC Licenses as contemplated by this Agreement is subject to the prior consent and approval of the FCC. Prior to the Closing, Buyer shall not directly or indirectly control, supervise, direct, or attempt to control, supervise, or direct, the operations of the Station, and all such operations, including complete control and supervision of all of the Station' programs, employees, and policies, shall be the sole responsibility of Seller until the Closing.

        (b)  Within five business days after the date hereof, Buyer and Seller shall prepare and jointly file a complete and grantable FCC Application, and the parties shall use reasonable efforts to cause the FCC to accept the FCC Application for filing as soon as practicable thereafter. Seller and Buyer shall thereafter prosecute the FCC Application in good faith and with all reasonable diligence and otherwise use their best efforts to obtain the grant of the FCC Application as expeditiously as practicable; provided, however, that neither Seller nor Buyer shall have any

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obligation to satisfy any complainant or the FCC by taking any steps which would have a material adverse effect upon Seller or Buyer or upon any affiliated entity, but neither the expense nor inconvenience to a party of defending against a complainant or an inquiry by the FCC shall be considered a material adverse effect on such party. If the FCC Consent imposes any condition on any party hereto, such party shall use its best efforts to comply with such condition; provided, however, that no party shall be required to comply with any condition that would have a material adverse effect upon it or any affiliated entity. If rehearing, reconsideration or judicial review is sought by a third party or by the FCC on its own motion with respect to the FCC Consent, Buyer and Seller shall vigorously oppose such efforts for rehearing, reconsideration or judicial review; provided, however, that nothing herein shall be construed to limit either party's right to terminate this Agreement pursuant to Article 10 (Termination Rights).

        (c)  All FCC filing or grant fees with respect to the assignment of the FCC Licenses from Seller to Buyer shall be paid equally by Buyer and Seller. Each party shall otherwise bear its own costs and expenses (including the fees and disbursements of its counsel) in connection with the preparation of the portion of the FCC Application to be prepared by it and in connection with the processing and defense of the application.

5.2  Other Filings and Governmental Consents. Promptly following the execution of this Agreement, the parties shall prepare and file with the appropriate governmental authorities any other requests for approval or waiver that are required from such governmental authorities in connection with the transactions contemplated hereby and shall diligently and expeditiously prosecute, and shall cooperate fully with each other in the prosecution of, such requests for approval or waiver and all proceedings necessary to secure such approvals and waivers. Each party shall bear its own costs and expenses in connection with the preparation of any filings, documents or requests to be prepared by it in order to obtain such governmental consents, approvals or waivers and in connection with any prosecution or defense by it of such filings, documents or requests.

ARTICLE 6
COVENANTS

6.1  Conduct of Business.

        (a)  Affirmative Covenants. Between the date of this Agreement and the Closing Date, except as expressly permitted by this Agreement or the Time Brokerage Agreement or with the prior written consent of Buyer, which consent shall not be unreasonably withheld, Seller shall:

        (i)    Comply in all material respects with all laws applicable to Seller's use of the Station Assets and continue to operate and maintain the Station in conformity with the Station Licenses, the Communications Act of 1934, as amended, and the rules and regulations of the FCC.

        (ii)  Maintain the Station Assets in customary repair, maintenance and condition.

        (iii)  Use reasonable efforts to obtain the consent of any third party necessary for the assignment to Buyer, without any material adverse change, of the contracts listed on Schedule 1.2(c).

        (iv)  Timely make or provide all payments, services or other consideration due for the Assumed Contracts so that all payments required to be made as of the Closing Date will have been paid, except for any amounts being contested by Seller in good faith.

        (v)  Maintain in full force and effect the Station Licenses and all other licenses, permits and authorizations relating to the Station and take any action necessary before the FCC,

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including the preparation and prosecution of applications for renewal of the FCC Licenses, if necessary, to preserve such licenses in full force and effect without material adverse change.

        (vi)  Maintain insurance on the Station Assets.

        (vii) To the extent Seller may do so without penalty, terminate, or send notice of termination of, such of the Assumed Contracts as Buyer may request.

        (viii) Use its best efforts to complete all of the Station' Barter Obligations prior to the Closing.

        (ix)  Exercise all renewal options on the transmitter site leases for which notice of renewal would be required to be given prior to the Closing.

        (x)  Repair, at its expense, all items of Personal Property included in the Station Assets to the extent Buyer's inspection of same reveals items which, in the reasonable opinion of Buyer, require such repair.

        (xi)  Provide to Purchaser, in the ordinary course of business and as available, copies of financial statements for the Station in respect of periods on and after December 31, 2002.

        (b)  Negative Covenants. Between the date of this Agreement and the Closing Date, except as expressly permitted by this Agreement or the Time Brokerage Agreement or with the prior written consent of Buyer, which consent shall not be unreasonably withheld, Seller shall not:

        (i)    Terminate, modify or amend any Assumed Contract except as contemplated in Section 6.1(a)(vii).

        (ii)  Create any Lien on any of the Station Assets.

        (iii)  Sell, assign, lease or otherwise transfer or dispose of any of the material Station Assets now owned or hereafter acquired, except for assets consumed or disposed of in the ordinary course of business.

6.2  Access. Between the date hereof and the Time Brokerage Date and thereafter as contemplated in the Time Brokerage Agreement, Seller will afford Buyer reasonable access to the Station and the Station Assets. Buyer, at its sole expense, shall be entitled to make such engineering and other inspections of the Station Assets as Buyer may desire, so long as such inspection would not unreasonably interfere with the operation of the Station.

6.3  No Inconsistent Action. Between the date of this Agreement and the Closing, each party shall use its reasonable efforts to cause the fulfillment at the earliest practicable date of all of the conditions to the obligations of the other party to consummate the sale and purchase and shall take no actions which are inconsistent with its obligations under this Agreement or that would materially hinder or delay the consummation of the transactions contemplated by this Agreement. In particular, neither party shall take any action that would jeopardize the Station Licenses, result in its disqualification to hold the FCC Licenses or in any way delay grant of the FCC Application or consummation of the transactions contemplated by this Agreement, and Buyer shall take no action which would impair its financial or other qualifications to consummate this transaction in accordance with its terms. Should either party become aware of any such fact or circumstance, such party shall promptly inform the other.

6.4  Confidentiality.

        (a)  Buyer and Seller shall each keep confidential all information obtained by it with respect to the other in connection with this Agreement, except where such information is known through other lawful sources or where its disclosure is required in accordance with applicable law. If the transactions contemplated hereby are not consummated for any reason, Buyer and Seller shall return to the other, without retaining a copy thereof in any medium whatsoever, any schedules,

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documents or other written information, including all financial information, obtained from the other in connection with this Agreement and the transactions contemplated hereby. Except as is required for the consummation of the transaction contemplated by this Agreement, during the period from the date hereof through the Closing Date, both Buyer and Seller shall also keep confidential the fact that the parties have entered into this Agreement and all other matters relating to this transaction.

        (b)  Except as required by the FCC in connection with the filing of the FCC Application, without the prior consent of both Buyer and Seller, there shall be no public announcement relating to this Agreement.

6.5  Further Assurances. Seller and Buyer shall cooperate and take such actions, and execute such other documents, at the Closing or subsequently, as may be reasonably requested by the other in order to carry out the provisions and purposes of this Agreement, including, for example, promptly advising each other of all communications relevant to the transactions contemplated by this Agreement received from the FCC after the date of this Agreement and furnishing each other with copies of all such written communications and summaries of all such oral communications.

6.6  Employees; ERISA.

        (a)  Employment. The Buyer may, but is not obligated to, offer employment to any of the employees of the Station in positions and on terms substantially similar to their present employment, effective as of the Time Brokerage Date. To the extent the Buyer employs any employees of the Station and terminates such employees after the Time Brokerage Date, the Buyer shall be responsible for any severance pay owed to such employee of the Station that the Buyer terminates within one year after the Time Brokerage Date. To the extent the employees are not offered employment with Buyer and are terminated by Seller, the Seller shall pay to any such employee severance in accordance with the policy of the Station.

        (b)  Employee Benefits Generally. The Buyer shall provide all employees of the Station that become employees of the Buyer ("Covered Employees") employee benefits that are maintained by the Buyer generally for its employees (the "HBC Plans") in accordance with their terms. To the extent permitted by the terms of the HBC Plans, the Buyer will (i) waive all deductibles, waiting periods and limitations with respect to pre-existing conditions and other conditions applicable to employees of Seller under the HBC Plans, and (ii) grant full past service credit (including credit for eligibility, benefit accrual and for vesting) to the Covered Employees for service with Seller or its subsidiaries or affiliates under any and all of the HBC Plans. Neither this Agreement nor the consummation of the transactions contemplated by this Agreement will entitle any employee, including but not limited to, Covered Employees, to any other severance benefits nor will it accelerate compensation due any such Covered Employee as of the Time Brokerage Date. Subject to the foregoing, the Buyer shall have the right in the good faith exercise of operations and managerial discretion to make changes or cause changes to be made after the Time Brokerage Date in compensation, benefits and other terms of employment and to terminate any such employee.

6.7  Agreement with Fritz Broadcasting Co. Attached hereto as Schedule 6.7 is a true and correct copy of a letter agreement (as amended to date, the "Fritz Letter Agreement") between Seller and Fritz Broadcasting Co. ("Fritz"). On and after the Closing, (i) Seller will assign to Buyer its rights to cause Fritz to make certain modifications to KFAN-FM, as contemplated by the Fritz Letter Agreement, and (ii) Buyer will assume Seller's obligations to pay to Fritz the sum of $900,000 (of which $650,000 is to be paid at Closing and $250,000 is to be placed into an escrow) and to reimburse Fritz for out-of-pocket costs associated with the modifications to KFAN-FM, all as contemplated by the Fritz Letter Agreement. Further, Buyer will reimburse Seller at the Closing for the $100,000 down payment previously made by Seller under the Fritz Letter Agreement.

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6.8  Cooperation Relative to Accounts Receivable. Following the Time Brokerage Date, the Buyer shall (i) assist the Seller, as reasonably requested in the collection of the Accounts Receivable for a period of 120 days (it being understood that Buyer is not required to expend any of is own funds in connection therewith), (ii) deliver to the Seller, on or before the 15^th, 30^th, 45^th, 60^th, 75^th, 90^th and 120^th days following the Time Brokerage Date (each, a "Turnover Date") and thereafter, any checks or other instruments received by the Buyer in respect of the Seller's Accounts Receivables (and endorse to the order of Seller any such checks which are erroneously made payable to the Buyer). In addition, the Buyer hereby agrees and acknowledges (a) that the Accounts Receivable are solely the property of the Seller, (b) that all payments received by the Buyer on account of the Accounts Receivable shall be held in trust for the benefit of the Seller and (c) that all such payments shall be delivered to Seller together with any necessary endorsements thereon, on each Turnover Date and thereafter. To the extent that Seller has not received payment on any Accounts Receivable as of the 120^th day following the Time Brokerage Date, Buyer shall have no further obligation or right to collect the Accounts Receivable, unless otherwise agreed upon by Seller and Buyer, and Buyer shall promptly return any and all documentation related to the Accounts Receivable to Seller. Notwithstanding the foregoing, Buyer shall have no obligation to contact account debtors or undertake other collection efforts in respect of Seller's Accounts Receivables.

6.9  Studio Facility Operations. On or prior to Closing, Seller shall remove all of its operations, including its AM radio operations (which shall include, but not be limited to, all assets and personnel), other than those pertaining to the Station, from the leased property assumed by Buyer pursuant to this Agreement.

ARTICLE 7
CONDITIONS PRECEDENT

7.1  To Buyer's Obligations. The obligations of Buyer hereunder are, at its option, subject to satisfaction or waiver by Buyer (except for prior FCC consent), at or prior to the Closing Date, of each of the following conditions:

        (a)  Representations, Warranties and Covenants.

        (i)    All representations and warranties made by Seller in this Agreement shall be true and correct in all material respects (except as otherwise expressly permitted by this Agreement) on and as of the Closing Date as if made on and as of that date.

        (ii)  All of the terms, covenants and conditions to be complied with and performed by Seller under this Agreement on or prior to Closing Date shall have been complied with or performed by Seller in all material respects.

        (b)  FCC Consent. The FCC Consent shall have been obtained, without the imposition of any condition materially adverse to Buyer except those that are customary in the assignment of FM licenses. Licensee shall have complied with any conditions imposed on it by the FCC Consent, and the FCC Consent shall have become a Final Order (unless Buyer elects to waive the Final Order).

        (c)  No Injunction. No order of any court or administrative agency shall be in effect which restrains or prohibits the transactions contemplated by this Agreement in accordance with its terms.

        (d)  Governmental Authorizations. Licensee shall be the holder of all FCC Licenses, and there shall not have been any modification of any Station License relating to the Station that could have an adverse effect on the Station or the conduct of the business and operations of the Station. No proceeding (other than proceedings affecting the broadcasting industry generally) shall be pending which presents a substantial probability of revocation, failure to renew, suspension or materially adverse modification of any FCC License.

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        (e)  Consents. Seller shall have obtained all necessary approvals and consents to the assignment to Buyer of each Assumed Contract without any adverse change in the terms or conditions of such contracts.

        (f)    Broadcasting at New Transmitter Site. The Station shall have received program test authority from the FCC as a Class C-3 radio station and shall be broadcasting from the New Transmitter Site in accordance with such authority.

        (g)  Deliveries. Seller shall have made or stand willing to make all deliveries required under Section 8.1.

7.2  To Seller's Obligations. The obligations of Seller hereunder are, at its option, subject to satisfaction or waiver by Seller (except for prior FCC Consent), at or prior to the Closing Date, of each of the following conditions:

        (a)  Representations, Warranties and Covenants.

        (i)    All representations and warranties made by Buyer in this Agreement shall be true and correct in all material respects (except as otherwise expressly permitted by this Agreement) on and as of the Closing Date as if made on and as of that date.

        (ii)  All of the terms, covenants and conditions to be complied with or performed by Buyer under this Agreement on or prior to the Closing Date shall have been complied with or performed by Buyer in all material respects.

        (b)  FCC Consent. The FCC Consent shall have been obtained, without the imposition of any condition materially adverse to Seller except those that are customary in the assignment of FM licenses. Buyer shall have complied with any conditions imposed on it by the FCC Consent.

        (c)  No Injunction. No order of any court or administrative agency shall be in effect which restrains or prohibits the transactions contemplated by this Agreement in accordance with its terms.

        (d)  Deliveries. Buyer shall have made or stand willing to make all the deliveries required under Section 8.2and shall have paid or stand willing to pay the Purchase Price as provided in Section 2.3.

        (e)  Consent. All necessary approvals and consents to the assignment to Buyer of each Assumed Contract shall have been obtained.

ARTICLE 8
DOCUMENTS TO BE DELIVERED AT THE CLOSING

8.1  Documents to be Delivered by Seller. At the Closing, Seller shall deliver to Buyer the following:

        (a)  A certificate, dated as of the Closing Date, executed by an officer or manager of Operating Company and of Licensee, certifying that the closing conditions specified in Section 7.1(a) have been satisfied;

        (b)  Duly executed instruments of conveyance and transfer, in form and substance reasonably satisfactory to Buyer, effecting the sale, transfer, assignment and conveyance of the Station Assets to Buyer free and clear of all Liens, including, but not limited to, the following:

        (i)    an assignment of the FCC Licenses;

        (ii)  bills of sale for all Personal Property; and

        (iii)  an assignment of Seller's rights under the Assumed Contracts;

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        (c)  A copy of any instrument evidencing receipt of any of the required consents described in Section 7.1(e);

        (d)  Such other documents, information, certificates and materials as may be required by this Agreement.

8.2  Documents to be Delivered by Buyer. At the Closing, Buyer shall deliver to Seller the following:

        (a)  A certificate, dated as of the Closing Date, executed on behalf of Buyer by a duly authorized representative of Buyer, certifying that the closing conditions specified in Section 7.2(a) have been satisfied;

        (b)  The Purchase Price in immediately available wire transferred federal funds as provided in Section 2.3; and

        (c)  Such other documents, information, certificates and materials as may be required by this Agreement.

ARTICLE 9
INDEMNIFICATION, SURVIVAL

9.1  Seller's Indemnities. From and after the Closing, Seller shall indemnify, defend, and hold harmless Buyer and its affiliates and their respective members, managers, partners, directors, officers, employees, and representatives, and the successors and assigns of any of them, and any person claiming by or through any of them, from and against, and reimburse them for, all claims, damages, liabilities, losses, costs and expenses, including, without limitation, interest, penalties, court costs and reasonable attorneys' fees and expenses, resulting from:

        (a)  The ownership or operation of the Station Assets prior to the Closing, including without limitation any liabilities arising under the Station Licenses or the Assumed Contracts which relate to events occurring prior to the Closing;

        (b)  Any liabilities of Seller not assumed by Buyer under this Agreement, including without limitation any liabilities arising at any time under any contract or agreement not included in the Assumed Contracts;

        (c)  Any untrue representation, breach of warranty or nonfulfillment of any covenant by Seller contained in this Agreement or in any certificate, document or instrument delivered by Seller to Buyer under this Agreement;

        (d)  Any failure of Seller to comply with any "bulk sales" laws applicable to the transactions contemplated hereby; or

        (e)  Any actions, suits, proceedings, claims, demands, assessments, judgments, costs and expenses, including reasonable legal fees and expenses, incident to any of the foregoing or incurred in investigating or attempting to avoid the same or to oppose the imposition thereof, or in enforcing this indemnity.

9.2  Buyer's Indemnities. From and after the Closing, Buyer shall indemnify, defend and hold harmless Seller and its affiliates and their respective members, managers, partners, directors, officers, employees, and representatives, and the successors and assigns of any of them, and any person claiming by or through any of them, from and against, and reimburse them for, all claims, damages, liabilities,

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losses, costs and expenses, including, without limitation, interest, penalties, court costs and reasonable attorneys' fees and expenses, resulting from:

        (a)  any untrue representation, breach of warranty or nonfulfillment of any covenant by Buyer contained in this Agreement or in any certificate, document or instrument delivered by Buyer to Seller under this Agreement;

        (b)  the ownership or operation of the Station Assets from and after the Closing;

        (c)  any actions, suits, proceedings, claims, demands, assessments, judgments, costs and expenses, including reasonable legal fees and expenses, incident to any of the foregoing or incurred in investigating or attempting to avoid the same or to oppose the imposition thereof, or in enforcing this indemnity; or

        (d)  any liability or obligations assumed by Buyer under this Agreement or arising from the conduct of Buyer after the Closing Date.

9.3  Procedure for Indemnification. The procedure for indemnification shall be as follows:

        (a)  The party seeking indemnification under this Article 9 (the "Claimant") shall give notice to the party from whom indemnification is sought (the "Indemnitor") of any claim, reasonably specifying (i) the factual basis for the claim; and (ii) the amount of the claim if then known. If the claim relates to an action, suit or proceeding filed by a third party against Claimant, notice shall be given by Claimant within fifteen (15) days after written notice of the action, suit or proceeding was given to Claimant. In all other circumstances, notice shall be given by Claimant within thirty (30) days after Claimant becomes aware of the facts giving rise to the claim. Notwithstanding the foregoing, Claimant's failure to give Indemnitor timely notice shall not preclude Claimant from seeking indemnification from Indemnitor if Claimant's failure has not materially prejudiced Indemnitor's ability to defend the claim or litigation.

        (b)  The Claimant shall make available to Indemnitor and/or its authorized representatives the information relied upon by the Claimant to substantiate the claim for indemnity.

        (c)  With respect to any claim by a third party as to which the Claimant is entitled to indemnification hereunder, the Indemnitor shall defend against the claim with counsel reasonably acceptable to Claimant, and the Claimant shall cooperate fully with the Indemnitor, subject to reimbursement for reasonable expenses incurred by the Claimant as the result of a request by the Indemnitor. The Claimant shall have the right to participate in the defense of the claim at its own expense. If the Indemnitor does not assume control of the defense of any third party claim, Claimant may, but shall have no obligation to, defend or settle such claim or litigation in such a manner as it deems appropriate, and in such event Indemnitor shall be bound by the results obtained by the Claimant with respect to the claim (by default or otherwise) and shall promptly reimburse Claimant for the amount of all expenses (including the amount of any judgment rendered), legal or otherwise, incurred in connection with such claim or litigation. The Indemnitor shall be subrogated to all rights of the Claimant against any third party with respect to any claim for which indemnity was paid.

9.4  Limitations. Neither party shall be required to indemnify the other party under this Article 9 unless (i) written notice of a claim under this Article 9 was received by the party within the pertinent survival period specified in Section 9.5; and (ii) the aggregate amount of claims against the party to which the other party (as a Claimant) is entitled to be indemnified under this Agreement exceeds $25,000, after which the Claimant shall be entitled to recover, and the Indemnitor shall be obligated for, all additional losses, costs, liabilities, damages and expenses for Claimant. In calculating the amount of losses to the Buyer or the Seller under Section 9.1 and Section 9.2, (a) such losses shall be reduced by any recovery received from any third party (including insurance proceeds) as a result of the

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facts or circumstances giving rise to the losses, and (b) no amount shall be included in such losses except for the party's actual out-of-pocket costs and expenses.

9.5  Survival of Representations, Warranties and Covenants. The representations, warranties, covenants, indemnities and other agreements contained in this Agreement or in any certificate, document or instrument delivered pursuant to this Agreement are and will be deemed and construed to be continuing representations, warranties, covenants, indemnities and agreements and shall survive the Closing for a period of 18 months (the "Survival Period"). No claim may be brought under this Agreement unless written notice describing in reasonable detail the nature and basis of such claim is given on or prior to the last day of the Survival Period. In the event such notice is given, the right to indemnification with respect thereto shall survive the Survival Period until such claim is finally resolved and any obligations thereto are fully satisfied. Any investigation by or on behalf of any party hereto shall not constitute a waiver as to enforcement of any representation, warranty, covenant or agreement contained herein.

ARTICLE 10
TERMINATION RIGHTS

10.1 Termination.

        (a)  In addition to other available remedies, this Agreement may be terminated by either Buyer or Seller, if the party seeking to terminate is not in material default or breach of this Agreement, upon written notice to the other if:

        (i)    the other party is in material breach of this Agreement or the Time Brokerage Agreement and such breach has been neither cured within thirty (30) days after written notice of such breach nor waived by the party giving such termination notice;

        (ii)  a court of competent jurisdiction or governmental, regulatory or administrative agency or commission shall have issued an order, decree or ruling or taken any other action permanently restraining, enjoining or otherwise prohibiting the transactions contemplated by this Agreement and such order, decree, ruling or other action shall have become final and nonappealable; or

        (iii)  the Closing has not occurred by a date that is one (1) year from the date of this Agreement (the "Upset Date");

        (b)  This Agreement may be terminated by mutual written consent of Buyer and Seller.

        (c)  If either party believes the other to be in breach or default of this Agreement, the non-defaulting party shall, prior to exercising its right to terminate under Section 10.1(a)(i), provide the defaulting party with notice specifying in reasonable detail the nature of such breach or default. Except for a failure to pay the Purchase Price, the defaulting party shall have thirty (30) days from receipt of such notice to cure such default; provided that, if the breach or default is due to no fault of the defaulting party and is not capable of cure within such thirty (30) day period, the cure period shall be extended as long as the defaulting party is diligently and in good faith attempting to effect a cure. Nothing in this Section 10.1(c) shall be interpreted to extend the Upset Date.

10.2 Effect of Termination. The following sections shall survive the termination of this Agreement pursuant to Section 10.1(a): 6.4 (Confidentiality), 11.1 (Default), 11.3 (Limitations on Damages), 12.3 (Entire Agreement; Schedules; Amendment; Waiver), 12.4 (Headings), 12.5 (Computation of Time), 12.6 (Governing Law; Waiver of Jury Trial), 12.7 (Attorneys' Fees), 12.9 (Notices), 12.10 (Counterparts) and 13.1 (Definitions).

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ARTICLE 11
REMEDIES UPON DEFAULT

11.1 Remedies Generally. The parties acknowledge that the Station Assets and the transactions contemplated hereby are unique, that a failure by Seller or Buyer to complete such transactions will cause irreparable injury to the other, and that actual damages for any such failure may be difficult to ascertain and may be inadequate. Consequently, Seller and Buyer agree that each shall be entitled, in the event of a default by the other, to specific performance of any of the provisions of this Agreement in addition to any other legal or equitable remedies to which the non-defaulting party may otherwise be entitled.

11.2 Limitations on Damages. Notwithstanding the foregoing, neither party shall be liable to the other for special, consequential, punitive or exemplary damages, and in no event shall Seller's total liability to Buyer under this Agreement (including, for example, Seller's liability to Buyer pursuant to Section 9.1 (Seller's Indemnities) and Buyer's liability to Seller pursuant to Section 9.2 (Buyer's Indemnifies)) exceed the amount of the Purchase Price if after Closing, or the Deposit Amount, if before Closing.

ARTICLE 12
OTHER PROVISIONS

12.1 Transfer Taxes and Expenses. All recordation, transfer, and documentary fees (but not including FCC fees or sales taxes, if any) imposed on this transaction shall be paid one-half by Buyer and one-half by Seller. Sales taxes, if any, imposed in connection with the transactions contemplated by this Agreement shall be paid one-half by Buyer and one-half by Seller. Except as otherwise provided in this Agreement, each party shall be solely responsible for and shall pay all other costs and expenses (including attorney and accounting fees) incurred by it in connection with the negotiation, preparation and performance of and compliance with the terms of this Agreement.

12.2 Benefit and Assignment. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns. Neither Buyer nor Seller may assign its rights under this Agreement without the prior written consent of the other; provided, however, that Buyer may assign this Agreement to one or more of its wholly-owned subsidiaries and may assign the right to have the Station Licenses assigned to a designated trustee, so long as (i) any such assignment does not result in any delay of the Closing and (ii) Hispanic Broadcasting Corporation continues to remain liable hereunder for the obligations of any assignee(s).

12.3 Entire Agreement; Schedules; Amendment; Waiver. This Agreement and the exhibits and schedules hereto and thereto, embody the entire agreement and understanding of the parties hereto and supersede any and all prior agreements, arrangements and understandings relating to the matters provided for herein. Any matter that is disclosed in a schedule hereto shall be deemed to have been included in other pertinent schedules, notwithstanding the omission of an appropriate cross-reference. No amendment, waiver of compliance with any provision or condition hereof or consent pursuant to this Agreement shall be effective unless evidenced by an instrument in writing signed by the party against whom enforcement of any waiver, amendment or consent is sought. No failure or delay on the part of Buyer or Seller in exercising any right or power under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.

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

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12.5 Computation of Time. If after making computations of time provided for in this Agreement, a time for action or notice falls on Saturday, Sunday or a federal holiday, then such time shall be extended to the next business day.

12.6 Governing Law;. The construction and performance of this Agreement shall be governed by the law of the State of Texas without regard to its principles of conflicts of law.

12.7 Attorneys' Fees. In the event of any dispute between the parties to this Agreement, Seller or Buyer, as the case may be, shall reimburse the prevailing party for its reasonable attorneys' fees and other costs incurred in enforcing its rights or exercising its remedies under this Agreement. Such right of reimbursement shall be in addition to any other right or remedy that the prevailing party may have under this Agreement.

12.8 Severability. If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to any extent, be held invalid or unenforceable, the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each such term and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law.

12.9 Arbitration.

        (a)  Arbitration Disclosures.

        (i)    ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY VERY LIMITED REVIEW BY A COURT.

        (ii)  IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN COURT, INCLUDING THEIR RIGHT TO A JURY TRIAL.

        (iii)  DISCOVERY IN ARBITRATION IS MORE LIMITED THAN DISCOVERY IN COURT.

        (iv)  ARBITRATORS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING IN THEIR AWARDS. THE RIGHT TO APPEAL OR TO SEEK MODIFICATION OF ARBITRATORS' RULINGS IS VERY LIMITED.

        (v)  IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY OR THE AMERICAN ARBITRATION ASSOCIATION.

        (b)  Arbitration Provisions. Any dispute or controversy between the parties arising under or in connection with this Agreement and by execution and delivery of this Agreement shall be resolved under the Commercial Arbitration Rules of the American Arbitration Association (the "Administrator"). In this regard:

        (i)    Any claim or controversy ("Dispute") between the parties and their assigns, including, but not limited to, Disputes arising out of or relating to this Agreement, this Section 12.9 ("arbitration clause"), or any related agreements or instruments relating hereto or delivered in connection herewith ("Related Documents"), shall, at the request of either party, be resolved by binding arbitration in accordance with the applicable arbitration rules of the Administrator. The provisions of this arbitration clause shall survive any termination, amendment or expiration of this Agreement or the Related Documents. If any provision of this arbitration clause should be determined to be unenforceable, all other provisions of this arbitration clause shall remain in full force and effect.

        (ii)  The arbitration proceedings shall be conducted in Austin, Texas at a place to be determined by the Administrator. The Administrator and the arbitrator(s) shall have the authority to the extent practicable to take any action to require the arbitration proceeding to

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be completed and the arbitrator(s)' award issued within one hundred twenty (120) days of the filing of the Dispute with the Administrator.

        (iii)  The arbitrator(s) shall be selected in accordance with the rules of the Administrator from panels maintained by the Administrator. A single arbitrator shall have expertise in the subject matter of the Dispute. Where three arbitrators conduct an arbitration proceeding, the Dispute shall be decided by a majority vote of the three arbitrators, at least one of whom must have expertise in the subject matter of the Dispute and at least one of whom must be a practicing attorney. The arbitrator(s) shall award to the prevailing party recovery of all costs and fees (including attorneys' fees and costs, arbitration administration fees and costs, and arbitrator(s)' fees). The arbitrator(s), either during the pendency of the arbitration proceeding or as part of the arbitration award, also may grant provisional or ancillary remedies, including but not limited to an award of injunctive relief, foreclosure, sequestration, attachment, replevin, garnishment, or the appointment of a receiver.

        (iv)  Judgment upon an arbitration award may be entered in any court having jurisdiction, and the amount of the arbitration award shall be binding. The computation of the total amount of an arbitration award shall include amounts awarded for attorneys' fees and costs, arbitration administration fees and costs, and arbitrator(s)' fees.

        (v)  Either party may initiate arbitration with the Administrator; however, if either party initiates litigation and another party disputes any allegation in that litigation, the disputing party, upon the request of the initiating party, must file a demand for arbitration with the Administrator and pay the Administrator's filing fee. The parties may serve by mail a notice of an initial motion for an order of arbitration.

        Notwithstanding the applicability of any other law to this Agreement, the arbitration clause or Related Documents between the parties, the Federal Arbitration Act, 9 U.S.C. Section 1, et seq., shall apply to the construction and interpretation of this arbitration clause.

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12.10  Notices. Any notice, demand or request required or permitted to be given under this Agreement shall be in writing and shall be addressed to the following addresses or to such other address as any part may request:

If to Seller:	c/o Simmons Media Group, LLC 515 South 700 East, #1C Salt Lake City, Utah 84102 Attention: David E. Simmons Telephone: 801-323-9315 Telecopier 801-323-9316 E-mail: dsimmons@simmonsmedia.com
With a copy to:	Laurie S. Hart Callister Nebeker & McCullough Gateway Tower East #900 East South Temple Street Salt Lake City, UT 84133 Telephone: 801-530-7456 Telecopier: 801-364-9127 E-mail: lshart@cnmlaw.com
If to Buyer:	c/o Hispanic Broadcasting Corporation 3102 Oak Lawn Avenue, Suite 215 Dallas, Texas 75219 Attn: Jeffrey T. Hinson, Senior Vice President Fax: 214-525-7750 E-mail: jhinson@hispanicbroadcasting.com
With a copy to:	Hallett & Perrin 2001 Bryan St., Suite 3900 Dallas, Texas 75201 Attn: Bruce H. Hallett Fax: 214-922-4170 E-mail: bhallett@hallettperrin.com

Any such notice, demand or request shall be deemed to have been duly delivered and received (a) on the date of personal delivery, (b) on the date of transmission if sent by facsimile, (c) on the date of receipt if mailed by registered or certified mail, postage prepaid and return receipt requested, or (d) on the date of a signed receipt if sent by an overnight delivery service.

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

ARTICLE 13
DEFINITIONS

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

        "Agreement" shall mean this Asset Purchase Agreement.

        "Assumed Contracts" shall have the meaning set forth in Section 1.2(c).

        "Buyer" shall have the meaning set forth in the preamble to this Agreement.

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        "Claimant" shall have the meaning set forth in Section 9.3.

        "Closing" shall have the meaning set forth in Section 1.1.

        "Closing Date" shall mean the date on which the Closing is completed.

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

        "FCC" shall have the meaning set forth in the preamble to this Agreement.

        "FCC Application" shall mean the application or applications that Seller and Buyer must file with the FCC requesting its consent to the assignment of the FCC Licenses from Licensee to HBC License; provided, however, that in the event that the merger of Hispanic Broadcasting Corporation and Univision Communications Inc. ("Univision"), MB Docket No. 02-235, has not been consummated at the time the FCC Applications are to be filed, the FCC Applications also shall include an application seeking consent to the assignment from Licensee to HBC License as owned and controlled by Univision.

        "FCC Consent" shall mean the action by the FCC granting the FCC Application.

        "FCC Licenses" shall have the meaning set forth in Section 1.2(a).

        "Final Order" shall mean action by the FCC with respect to the FCC Application (i) which has not been vacated, reversed, stayed, set aside, annulled or suspended, (ii) with respect to which no timely appeal, request for stay or petition for rehearing, reconsideration or review by any party or by the FCC on its own motion is pending, and (iii) as to which the time for filing any such appeal, request, petition or similar document or for the reconsideration or review by the FCC on its own motion under the Communications Act of 1934, as amended, has expired.

        "Indemnitor" shall have the meaning set forth in Section 9.3.

        "Liens" shall mean mortgages, deeds of trust, liens, security interests, pledges, collateral assignments, condition sales agreements, leases, encumbrances, claims or other defects of title, but shall not include (i) liens for current taxes not yet due and payable and (ii) other liens imposed by law (such as materialman's mechanic's, carrier's, worker's and repairman's liens) arising in the ordinary course of business (provided that such liens do not interfere in any material respect with the use of the Station Assets as currently used and that Seller remains liable for paying such liens).

        "Personal Property" shall have the meaning set forth in Section 1.2(b).

        "Purchase Price" shall have the meaning set forth in Section 2.1.

        "Seller" shall have the meaning set forth in the preamble to this Agreement.

        "Station" shall have the meaning set forth in the preamble to this Agreement.

        "Station Assets" shall mean the assets to be transferred to Buyer hereunder, as more fully specified in Section 1.2.

        "Station Licenses" shall have the meaning set forth in Section 1.2(a).

        "Survival Period" shall have the meaning set forth in Section 9.5.

        "Upset Date" shall have the meaning set forth in Section 10.1(a)(iii).

13.2.  Miscellaneous Terms. The term "or" is disjunctive; the term "and" is conjunctive. The term "shall" is mandatory; the term "may" is permissive. Masculine terms apply to females as well as males; feminine terms apply to males as well as females. The term "includes" or "including" is by way of example and not limitation.

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[signature page of Asset Purchase Agreement]

        IN WITNESS WHEREOF, the parties hereto have caused this Asset Purchase Agreement to be duly executed as of the date first written above.

SELLER	Simmons-Austin, LLC
	By:	/s/  DAVID E. SIMMONS David E. Simmons, Chairman and Manager
	Simmons Lone Star Media, Ltd. By Simmons Media Group, LLC (general partner)
	By:	/s/  DAVID E. SIMMONS David E. Simmons, Manager
BUYER	HBC License Corporation
	By:	/s/  JEFFREY T. HINSON Jeffrey T. Hinson, Senior Vice President
	HBC Broadcasting Texas, L.P. By HBC GP Texas, Inc. (general partner)
	By:	/s/  JEFFREY T. HINSON Jeffrey T. Hinson, Senior Vice President

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Exhibit 10.19

ASSET PURCHASE AGREEMENT
WITNESSETH
ARTICLE 1 ASSETS TO BE CONVEYED
ARTICLE 2 PURCHASE PRICE
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF SELLER
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF BUYER
ARTICLE 5 GOVERNMENTAL CONSENTS
ARTICLE 6 COVENANTS
ARTICLE 7 CONDITIONS PRECEDENT
ARTICLE 8 DOCUMENTS TO BE DELIVERED AT THE CLOSING
ARTICLE 9 INDEMNIFICATION, SURVIVAL
ARTICLE 10 TERMINATION RIGHTS
ARTICLE 11 REMEDIES UPON DEFAULT
ARTICLE 12 OTHER PROVISIONS
ARTICLE 13 DEFINITIONS

EX-11

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Exhibit 11

Hispanic Broadcasting Corporation and Subsidiaries

Statement Regarding Computation of Per Share Earnings

(in thousands except per share data)

		Year Ended December 31,
		2002		2001		2000		1999		1998
Earnings:
Income from continuing operations		$	40,213	$	30,969	$	41,531	$	34,176	$	26,884
Preferred stock dividends			—		—		—		—		—
Net income applicable to common stockholders		$	40,213	$	30,969	$	41,531	$	34,176	$	26,884
Earnings Per Share:
	Basic	$	0.37	$	0.28	$	0.38	$	0.34	$	0.27
	Diluted	$	0.37	$	0.28	$	0.38	$	0.33	$	0.27
Number of Shares On Which Net Income Per Share Is Based:
Weighted average common shares before dilutive effect of common stock equivalents			108,723		108,872		108,858		101,566		98,042
Common stock equivalents:
	Stock options		804		733		1,514		1,347		635
	Employee Stock Purchase Plan		16		12		16		14		18
Weighted average common shares			109,543		109,617		110,388		102,927		98,695

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Exhibit 11

Hispanic Broadcasting Corporation and Subsidiaries Statement Regarding Computation of Per Share Earnings (in thousands except per share data)

EX-21

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Exhibit 21

Subsidiaries of the Company

HBC Broadcasting Texas, L.P.
HBC Florida, LLC
HBC Fresno, Inc.
HBC GP Texas, Inc.
HBC Houston License Corporation
HBC Illinois, Inc.
HBC Investments, Inc.
HBC License Corporation
HBC Los Angeles, Inc.
HBC Management Company, Inc.
HBC Network, Inc.
HBC New York, Inc.
HBC Phoenix, Inc.
HBC San Diego, Inc.
HBC Tower Company, Inc.
HBCi, LLC
HBC-Las Vegas, Inc.
Hispanic Tijuana S. de R.L. de C.V.
KCYT-FM License Corp.
KECS-FM License Corp.
KESS-AM License Corp.
KESS-TV License Corp.
KHCK-FM License Corp.
KICI-AM License Corp.
KICI-FM License Corp.
KLSQ-AM License Corp.
KLVE-FM License Corp.
KMRT-AM License Corp.
KTNQ-AM License Corp.
La Oferta, Inc.
License Corp. No 1
License Corp. No. 2
Mi Casa Publications, Inc.
Momentum Research, Inc.
Spanish Coast to Coast, Ltd.
T C Television, Inc.
Tichenor License Corporation
TMS Assets California, Inc.
TMS License California, Inc.
WADO Radio, Inc.
WADO-AM License Corp.
WLXX-AM License Corp.
WPAT-AM License Corp.
WQBA-AM License Corp.
WQBA-FM License Corp.

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Exhibit 21

Subsidiaries of the Company

EX-23

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Exhibit 23

Independent Auditors' Consent

The Board of Directors
Hispanic Broadcasting Corporation:

        We consent to incorporation by reference in the registration statements on Form S-3 (No. 333-42171) and Form S-8 (Nos. 333-43483 and 333-43495) of Hispanic Broadcasting Corporation of our report dated February 23, 2003, except for Note 2 which is as of March 17, 2002, relating to the consolidated balance sheets of Hispanic Broadcasting Corporation and subsidiaries as of December 31, 2002 and 2001, and the related consolidated statements of income and comprehensive income, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2002, and the related financial statement schedule, which report appears in the December 31, 2002 annual report on Form 10-K of Hispanic Broadcasting Corporation. Our report on the consolidated financial statements refers to the adoption of the provisions of Statement of Financial Accounting Standards ("SFAS") No. 141, Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets.

Dallas, Texas
March 31, 2003

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Independent Auditors' Consent